January 15, 2013
IDA OKs hospital borrowing
Cortland Regional Medical Center was given approval to refinance $16.5 million in bonds and take out an additional $5.5 million for new projects, during the Cortland County Business Development Corp. meeting Monday.
All board members voted yes, except for Johanna Ames who abstained because she is on the hospital board of directors.
The bond is expected to total about $22 million, but the hospital was approved for up to $25 million as leeway to cover closing costs, said Garry VanGorder, Industrial Development Agency and BDC executive director.
The hospital wants to refinance about $16.5 million in bonds and lower its interest rate from about 5.5 percent to 2.7 percent, said Al James, hospital controller.
The debt was incurred from a 12,000-square foot emergency room expansion and renovation project in 2002 to 2003, said VanGorder.
The remaining $5.5 million will be used to update the boiler system at a cost of $1.7 million, purchase radiology equipment for $1.6 million, update cardiology equipment for $900,000, and upgrade intravenous pumps to a wireless system.
The new equipment will be state-of-the-art equipment that is necessary in providing care to the community, James said.
The bonds are separate from a $10 million state Health Care Efficiency and Affordability Law grant awarded to the hospital in June for relocating the cardiology department and skilled nursing center, and building a new intensive care unit, James said.
The hospital is hoping to close on the bond refinancing Feb. 14, said VanGorder.
“The county Legislature does have to approve of this, as well,” he said.
The borrowing will have to be recommended on Thursday at a county Budget and Finance meeting and the Legislature must approve it on Jan. 24 for the deal to proceed, VanGorder said.
In other business:
l The BDC approved a loan to Sophia Enterprises LLC, a subsidiary of Comando’s restaurant on Comando Avenue in Cortland, for $19,200 to purchase equipment to start a cannery.
Johanna Ames and John Reagan abstained from voting because of previous business relationships with Comando’s.
Vince Fragnoli Jr., who owns Comando’s, started bottling the restaurant’s spaghetti sauce at Glen Industries in Watkins Glen in September.
The company is named after Fragnoli’s eldest daughter, Sophia, 5.
Fragnoli plans on expanding from bottling his restaurant’s signature spaghetti sauce to other sauces and products, including marinara, greens and beans, minestrone and meat sauce. Meatballs packaged in a 10-pound vacuum sealed bag and frozen dinners will also be added to Fragnoli’s food line.
The sauce labels will feature Fragnoli’s oldest daughter Sophia, 5, and the other labels will feature his youngest daughter, Olivia, 5 months.
Cavallaro Foods, a specialty foods distributor based in Syracuse, guaranteed Fragnoli the sale of a minimum of 924 24-ounce bottles of spaghetti sauce, marinara and meat sauce a week, Fragnoli said.
The spaghetti sauce is currently sold at local stores, such as Anderson Farm Market on Route 281 and Cortland Seafood on Pendleton Street, he said.
“I’m going to move to bigger chains such as Wegman’s and Tops,” said Fragnoli.
Fragnoli said he is converting his father’s former bakery that’s attached to Comando’s into a cannery.
The cannery is expected to be operational by mid-February at the latest, he said, but it will not be the cannery’s final destination.
“As I progressively grow, I’m just going to have to move to another building,” said Fragnoli.
Fragnoli will hire two full-time workers to help him at the cannery, starting at $8 an hour.
When the cannery is finished, Fragnoli expects to produce 180 gallons or 840 24-ounce bottles a day.
l Paul Dries, of FML in Homer, was appointed to the IDA by the county Legislature to fill the place vacated by Brian Mitteer, president and CEO of Cortland Regional Medical Center, who moved out of the county.
Dries was also appointed to the finance and personnel committees in Mitteer’s stead.
Dries will fulfill Mitteer’s two-year term that ends December 2013.
Dave Branstadt, a veterinarian and controlling partner with Midstate Veterinary Services in Cortland, was appointed to the BDC to fill Mitter’s vacant seat on the board.
Branstadt will fulfill Mitter’s three-year term on the BDC that will expire in 2014.
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