NEWPORT — Sullivan County Manager Derek Ferland began a new campaign on Monday for a proposed $54 million renovation to the county nursing home with a stark message to county delegates and residents: either make the critical facility improvements or stop running a nursing home entirely.
“We have major infrastructure systems that are failing on a daily basis, whether it’s our heating system, our plumbing system or electrical system,” Ferland said. “If we are going to stay in the nursing home business we have to do something.”
There is no current consideration or desire among the delegation to abandon the county’s 156-bed assisted living and care facility. But, as Ferland reiterated, the county delegates now face a “once in a 60 year decision” to invest in a costly but essential project to bring the facility into compliance with modern federal requirements and address an array of inefficiencies and aged and outdated infrastructure that impact daily operations and expenses.
The two-hour Zoom meeting was recorded and shared on social media primarily to inform county residents about the project, in hope to get a vote of approval from the delegation as soon as possible, county officials explained.
“Part of the reason for doing this and having it recorded was to make the meeting accessible so that residents could watch it, rather than us schedule 15 different meetings again for each community,” Ferland said.
Since last year, the county delegates have faced a dilemma over cost that appears to be growing more arduous as time passes. Between 2019 and August 2020, the estimated project cost for the renovation jumped from $39 million to $49 million, due to new changes to state building regulations and rising construction costs stemming from the ongoing novel coronavirus pandemic.
Since September 2020, when the delegates voted 11-1 to defer the project due to costs and economic uncertainty, the project’s estimated cost has increased to $54 million.
Between the pandemic’s impact on manufacturing production and availability of labor — which was already a growing issue in construction prior to the pandemic —professionals in the construction industry anticipate total project costs to increase by a rate of 10% per year through the next few years, according to county officials.
“[Some] people say to wait for the costs to go down,” said Commissioner Vice Chair Ben Nelson. “But the ones who are telling us about the escalating costs are the builders.”
The project in summaryFacilities Director Mary Bourque, in a new comprehensive presentation, provided a thorough summation of the project and its historical evolution since its inception in 2016. This presentation is approximately one-hour in length and may be seen on the county’s Facebook page, “Sullivan County New Hampshire Government.”
The county nursing home consists of three buildings, each added over time as industry practices and regulations evolved. The first building was the Sanders. Built in 1931, the Sanders was designed with a ratio of 2-4 beds per ward and common bathrooms. The Sanders did not have a common dining room or day spaces for residents to interact.
The new renovation project will meet modern-day standards that require all beds to have a window and a resident-to-bathroom ratio of 2:1, according to Bourque.
The project will replace the Sanders with a modern and energy-efficient building, renovate the Stearns to improve living spaces and make aesthetic and functional improvements to the facility entrance in the McConnell. The total improvements will also create more common areas for family visitations and community gatherings and maximize the overall operating efficiency by redistributing nurse workstations to allow staff to stay closer to their patients and return the county laundry services from the county prison to the nursing home.
The restoration of the laundry room would cost about $250,000, according to Bourque, but save the county $100,000 per year in staffing and operating efficiency.
A feasibility study in 2016 explored whether to renovate the Sanders building for a lesser cost, though county officials determined those recommendations impractical on numerous levels. Any consideration officially expired by 2018, when the new facility regulations put those recommendations out of compliance.
In the case of Sanders, Bourque said they “were struggling to deal with an expensive renovation just to make something work that no longer fit our needs.”
Renovation versus building in a new locationIn September, many delegates expressed a preference to build a new nursing home in a different location, such as Claremont or Newport, as the Unity complex was too remote and far from many families.
However, county officials said Monday they currently estimate that building a new facility elsewhere could cost between $75-80 million, about $20 million more than renovating the existing facility.
Much of that cost difference would be due to the projected cost of construction by 2023, which would likely be the earliest a new construction project could break ground, according to Bourque. A new construction would also require a new architecture design, at a cost of $1.5 million, and a land purchase, estimated to cost around $500,000.
A new construction would also have numerous unknown costs depending on geological findings on the property, such as soil contaminants or needed modifications to build.
County officials also say they anticipate an additional $1 million per year in operating costs by removing the nursing home from the county complex, where many savings are found through shared services with the county prison and the county’s biomass heating system.
Ferland said he also worried about whether interest rates, which are currently at historic lows, will still be favorable in a year or two.
Nelson and Sullivan County Commissioner Joe Osgood, both in attendance, said they supported the proposed renovation over starting over with a new construction.
“Financially we have already seen how much the costs can go up as we push this thing out,” Osgood said.
“This [renovation proposal] meets the needs we have now and will have for the next 60 years for the least amount of money,” Nelson said.
Asked about the possibility of building a smaller facility with fewer beds, Ferland said that maintaining the facility’s current capacity is necessary to maintain the current cost-model.
The Sullivan County Health Care facility depends heavily on having a portion of residents funded through private pay to offset expenses, as Medicaid rates do not capture the costs of care, according to the county manager.
The county’s nursing home is the second-best performing program in New Hampshire in terms of operating cost. Only Hillsborough’s nursing home operates at a surplus, while Sullivan’s nursing home “is close to breaking even,” according to Ferland. Most of the county-run homes in New Hampshire have annual deficits between $1.5 million to $2.5 million.