Good news possible on hospital’s horizon

If the legislation that cleared the Senate on May 27 ultimately earns Governor Schwarzenegger’s approval, the Sonoma Valley Hospital will be able to tell the public exactly what their long planned and desperately needed infrastructure upgrades will cost.
The bill, SB 1699, authored by Senator Patricia Wiggins, (D –Santa Rosa), and supported by the Sonoma Valley Hospital, will permit health care districts to use the “design-build” contracting method for the construction of hospitals or health facility buildings and related improvements, including seismic retrofitting.
Currently, under state law, district hospitals must use the “design-bid-build” model, which requires that they design their projects, then send them out for bid, and then award them to the lowest responsible bidder, a process which causes district hospitals throughout the state to face higher construction costs than private hospitals. The “design-build” method allows local officials to procure both design and construction services from a single company before developing plans and specifications, resulting in greater efficiency and lower costs–two things the Sonoma Valley Hospital will need if its current budget and renovation plans are to succeed.
“It’s critical,” said hospital CEO Carl Gerlach. “Design-build would reduce costs, time-consuming design and engineering disagreement, and can save you anywhere from 20 to 40 percent. You can go to one company and say, let’s take a look at the entire infrastructure upgrade.” Part of the efficiency is the careful planning the hospital does up front–“measure three times, cut once,” as he said– but once the plan and the team is in place, the process goes much faster. And you can set the parameters of your budget and stay within it.
Budget elasticity is frustrating to voters and dangerous for project planning. “What I learned in the early days, reviewing the cost estimation,” said Gerlach, “is there was this huge plus or minus. You can’t go to the voters with that!” With the “stipulated price” method of implementing design-build, a district hospital can set the budget for the cost of the building at the outset of the project and then solicit proposals from design-build contractors who will be bound by time and budget.
Gerlach hopes the design build legislation will have passed by the fall. Then he’ll be able to determine the scope of the project, select the team, decide on a budget and tell the taxpayers, “Here is what you’ll get for the dollars we’re asking.” Hospital boardmember Mike Smith at a recent meeting urged the board and members of the public to keep up with legislation, and let legislators know it. Right now, this bill is in the Assembly, where it may hover until the budget crisis is resolved. David Miller, press secretary for Senator Wiggins, said that while the hope is that the bill will clear the Assembly by early summer, “It depends on how quickly we move on the budget. That puts all other business on hold. The closer we get to the coming fiscal year [the more] other things slow down because the attention is focused on the emergency.”