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Grady vote drawing fire
Political, business leaders balk at conditions for restructuring

ATLANTA - The Grady Memorial Hospital board's decision to turn over management of the facility to a nonprofit was only the first step of what could become contentious negotiations with Georgia political and business leaders.

While Monday's unanimous vote by the Fulton-DeKalb Hospital Authority in favor of the restructuring was welcomed Tuesday as an encouraging sign, Gov. Sonny Perdue and legislative leaders objected to language in the resolution requiring the state to provide at least $30 million a year to the financially ailing hospital as a precondition.

"I have no intention of signing an unenforceable document that seeks to bind the state to a specific annual appropriation," the governor said in a prepared statement.

"There's a lot in this resolution that still has to be worked through," added Lt. Gov. Casey Cagle, the Senate's presiding officer.

Perdue, Cagle and other leaders of the Republican-controlled General Assembly have been urging Grady officials for months to turn over day-to-day operation of Georgia's largest public hospital to a nonprofit corporation.

A task force formed by the Metro Atlanta Chamber of Commerce recommended the restructuring as the best way to keep Grady from closing its doors.

The hospital, which serves the largest number of poor and uninsured patients in the state, has lost money in 10 of the last 11 years, including a projected shortfall of $55 million this year, and could close by the end of the year without a major boost in revenue.

Atlanta-area business leaders have vowed to contribute $200 million to help keep Grady afloat if the hospital board approves the restructuring. The resolution goes a step further by requiring that commitment in writing, along with a pledge to launch a campaign to raise an additional $100 million in private donations.

Like the state's political leaders, the retired business executive who led the chamber task force on Grady characterized the resolution as just a starting point for discussions with the hospital board.

"I'm sure the state, the counties and the charitable community will need some time to read and understand the conditions the board has established and determine how everyone can proceed toward an acceptable lease and a restructuring," said Pete Correll, former chairman and CEO of Georgia-Pacific. "We remain willing to help in any way we can to keep things moving in the right direction."

Time, however, is one commodity the parties don't have in great supply.

With Grady facing bankruptcy by the end of the year, the resolution calls for the restructuring to take effect as soon after Dec. 31 as legally possible.

Cagle said an approved agreement needs to be place by mid-January, when the 2008 session of the General Assembly convenes. If it's not, he said, lawmakers are likely to act on legislation mandating the restructuring.

Indeed, Sen. David Shafer, who has announced plans to pre-file a bill forcing the change, expressed frustration Tuesday at the Grady board attempting to set preconditions. Shafer, R-Duluth, said it ought to be the other way around.

"Conversion to nonprofit management is the essential first step," he said. "They keep shuffling their feet, but they will not move forward."

"They are not in a position to negotiate," added Senate President Pro Tempore Eric Johnson, R-Savannah. "A condemned man is not in a position to demand his last meal."