City of Montesano officials on June 13 expressed their frustrations at Grays Harbor Hospital District 2 for its lack of participation in an upcoming street project.

Contrary to a previous story in The Vidette, the hospital district did not ultimately agree to participate in the city’s East Pioneer project. The hospital district’s temporary construction easement with the city is for a storm drain project (which had been part of the street project but has since been separated into its own project).

Following several delays from the hospital district, the city was at its deadline for paperwork for the state Department of Transportation to move forward with the East Pioneer project. The project will include work to widen the sidewalks for handicap accessibility. The city had asked the hospital district for a sliver of its property (6 inches to 1 foot deep across one end of the property that is about 100 feet wide). City Chief Financial Officer Doug Streeter says the value of that sliver of land is about $97, based on values from the assessor’s office.

After receiving last-minute demands from the hospital district, Mayor Vini Samuel decided the city would press forward with the East Pioneer project without the hospital district’s property (the Montesano Clinic at 319 E. Pioneer Ave.)

While every other property within the scope of the project had come to an agreement with the city, the hospital district did not. The hospital had asked the city to trade for a plot of city-owned land that fronts a highway for the easement. The city declined. When the hospital district was told the city planned to build a billboard at that location, the hospital district then asked for an agreement that would allow the hospital district “first refusal” on advertising for the billboard. However, the hospital district included a stipulation that if the city had not built the billboard by December of this year, the city would owe the hospital district an unspecified amount (according to Streeter, hospital district Chief Operating Officer Larry Kahl floated a $40,000 penalty, and when Streeter balked, Kahl suggested $30,000).

Now that the project is moving forward without the hospital, it will cost the city some $5,000-$6,000 to have consultants revise the project plans.

During the council meeting, Councilman Dan Wood unleashed an uninhibited criticism of the hospital district.

“Given that every other public and private entity along that road worked with us in order to get the new road, new sidewalks… the hospital district laid out demands that would have cost the city tens of thousands of dollars in exchange for a $97 strip of property,” Wood said. “It is absolutely ridiculous for another public entity to try to screw the City of Montesano like this. They should be ashamed of themselves and they have some explaining to do.”

Councilman Tyler Trimble had similar feelings on the issue, he said.

“It’s difficult for me to understand, and it’s extremely disappointing that a public hospital — that we pay taxes into and they’re our hospital district — can’t see the bigger picture of their own constituency, and that we’re paying them to do this,” Trimble said. “You would always hope that the compromise for the greater good would prevail, and I don’t believe the hospital is doing that.”

Councilwoman Nikki Hutchinson-King questioned the whole situation saying, “I just feel like there has to be more to the story. It’s very disappointing.”

Ultimately, $800,000 in federal funding was on the line if the project didn’t move forward.

The $800,000 was awarded to the Grays Harbor Council of Governments (COG) as a block grant through the Surface Transportation Program administered by the Federal Highway Administration. Through a competitive process, COG awarded the funding to the City of Montesano for the East Pioneer Project. If the project hadn’t moved forward, that $800,000 would have been unobligated.

“It’s an $800,000 deadline, and if we don’t meet it, we lose $800,000, and COG loses $800,000 going forward into the foreseeable future on any transportation projects,” Streeter had said earlier in the week.

During the council meeting, Councilman Ian Cope noted the danger to countywide funding in his criticism of the hospital district.

“When you factor in the risks it’s putting on the entire county’s transportation dollars for the Council of Governments that just compounds it,” Cope said. “Talk about a lack of greater vision for the entire area.”

In recent reporting of the situation, hospital officials were asked for comment, but chose not to. Reaction on social media has been critical of the hospital.

In a statement released by the hospital late last week, hospital district officials say they’re not legally able to give property to the city, and that the discussion about the $40,000 line item in the billboard contract was a miscommunication.

“Exchanges between the hospital and the City of Montesano were moving forward with the thought that the land could be ‘traded’ for a position on a potential billboard the city was proposing,” the statement reads. “At no point in time did the hospital assume or claim the land related to this exchange was valued at $40,000. This simple misinterpretation of the language led to a complete breakdown in communication between the two parties.”

Transferring the property to the city would have required a “time-consuming and expensive process” the hospital district said.

In response to the statement, Samuel said the city would have liked to have known that from the beginning. Without the hospital district’s participation, the City of Montesano will not replace the sidewalks in front of the Montesano Clinic. And the city is expecting it will have to pay an additional $5,000-$6,000 in consulting fees to have the project re-engineered to exclude the property.

“If they knew that back in February or March, it’s unfortunate they didn’t share that with us because we could have cut them off without it costing us any money,” Samuel said.

The hospital district says discussions with the city began in March, and that deadlines were not communicated until the week of June 5.

“At no time did the hospital intentionally stall progress of this improvement. GHCH earnestly desires to be in sync with the needs of our constituents and believes the improvements to Pioneer Avenue will benefit all the businesses on that throughway,” the hospital district said in the statement. “When necessity was relayed, GHCH made administration available to any City of Montesano employee and received no response. As of 4:45 p.m. of June 9, 15 minutes before end of business, all documentation requested was supplied to the City of Montesano.”

Samuel disputes the contention that the deadlines weren’t known.

“The deadlines were clear to everyone. I think there was more emphasis in the last two weeks because we were freaking out, but the deadlines were clear because they had to be clear,” Samuel said.

The hospital’s statement reiterated the district’s duty to manage “the community’s investment.”

“The Public Hospital District 2 Board, administration and staff take these responsibilities very seriously and are constantly working to provide this community with the best possible outcomes whether it be health related or a much-needed improvement in the City of Montesano,” the district wrote.

The statement noted the hospital plans to continue working for progress in Grays Harbor County.

“With any agreement or negotiation there is room for misinterpretation,” the statement reads. “It is our desire to not debate these issues but work with each other to provide closure and compliance for all involved.”

Samuel said the city is content in moving on without the hospital district.

“Clearly we have a disagreement on the facts, but push comes to shove, they made a business decision so they’re no longer a part of the project,” she said. “I’m not going to debate fault because they’re no longer relevant to what our project is now. I made the best decision I could for the City of Montesano based on the status of the project.”

“It’s unfortunate because we could have improved their property,” she added. “What’s most important is we protect the City of Montesano, COG and all of those partners who need those transportation dollars.”