By Will Johnson
HOUSTON COUNTY- In a special meeting of the Houston County Hospital District Board of Directors, it was decided to approve a resolution renewing a loan with Prosperity Bank.
The meeting was held on Monday, Nov. 5 and the loan renewal was the only actionable item on the agenda.
In the absence of HCHD Board President Dr. Bob Grier, HCHD Vice-President Dr. John Stovall facilitated the meeting.
Following a brief discussion about when the next regular meeting would be held, the Prosperity Bank loan was addressed.
“Our original note with the bank was for $3.5 million and the board pledged – I guess that would be a good word – to reduce the principal by $300,000 every year. It has been two years and we have reduced the principal down to $2.9 million, which would be $600,000,” Stovall explained.
“The interest rate on the original loan was four percent and it’s time to renew the note,” the VP continued. “As everyone understands, interest rates have gone up. The prime rate is now 5.25 (percent). So, the gist of this resolution is to renew the note for 12 months at 5.25 percent, with everything else staying the same.”
Board member Dina Pipes further clarified, “On Feb. 1 we will pay $300,000 so from February until a year from now – we will only be paying interest on $2.6 million instead of $2.9 million. For the next few months – until we make that reduction – we’ll have to pay interest on $2.9 million.”
At this point in the meeting, Prosperity Bank Regional President Brandon Bridges arrived. Stovall explained what had transpired so far in the meeting and Bridges agreed everything which had been discussed was correct.
A motion to approve the resolution renewing the loan with Prosperity Bank was made by Rhonda Brown and seconded by Pipes.
Before a vote was taken, both Brown and Pipes asked that the record reflect neither one was on the HCHD Board of Directors at the time the loan was made.
“My personal thoughts were it was a bad business decision. I don’t know all the details but the district is obligated to pay this back to Prosperity so I’m going to vote yes to repay this loan,” Brown said.
“I wasn’t either,” Pipes added. “But an obligation – good or bad – is still there.”
“A lot of people were involved with a lot of business experience. It was decided that this was a necessary deal with Prosperity. That’s the way it was made but that’s water under the bridge. We are where we are today,” Stovall said.
Bridges requested if the motion could reflect who would execute the document and Stovall was chosen to do so.
With no more discussion, the VP called for a vote and the matter was passed unanimously. Once the resolution had been approved and with no more business to discuss, the meeting was adjourned.
Will Johnson may be contacted via e-mail at email@example.com.