A state program that offers interest-free loans to nonprofit and publicly-operated hospitals has credited $3.1 million to Sonoma Valley Hospital.
The Distressed Hospital Loan Program, jointly administered by the California Department of Health Care Access & Information (HCAI) and California Health Facilities Financing Authority (CHFFA), offered terms of 72 months, with an initial 18- month grace period at the beginning of the loan term.
Sonoma Valley Hospital CFO, Benjamin Armfield said the loan will help the facility to continue to recover from the challenges faced during the pandemic while planning for the future.
“As a rural community hospital in the heart of Sonoma Valley, we are pleased to be awarded this loan to continue to provide excellent care to our entire community,” he said. “The proceeds from this award provides us the opportunity to further reduce some of our existing liabilities, which are stalling our growth, and delivers working capital that will fund strategic initiatives to expand access to care throughout the Sonoma Valley.”
The Distressed Hospital Loan Program criteria speaks directly to SVH’s rural demographic, Armfield said: medically underserved populations and/or areas, distance to nearest alternative hospital, and predominantly Medi-Cal/Medicare payor mix.
Additionally, HCAI and CHFFA’s ‘Turnaround Plan’ criteria meets Sonoma Valley Hospital’s Strategic Plan, titled ‘Sustainability: Ensuring Our Financial Future’. Armfield said the SVH application demonstrated the ability to “further stabilize and secure the hospital financially to meet the growing demands for diverse healthcare services and needs in the community, both in the short and long-term.”
HCAI Director Elizabeth Landsberg said, “I’m grateful to the Legislature for spearheading this effort to help make sure these vital healthcare institutions are fiscally stable so they can continue to provide quality, affordable health care for all Californians.”