Tulare Local Healthcare District files chapter 9

The board of directors of the Tulare Local Healthcare District recently filed for chapter 9 bankruptcy.

TULARE — The board of directors of the Tulare Local Healthcare District recently filed for chapter 9 bankruptcy.

The chapter 9 petition is a special bankruptcy/reorganization proceeding available to certain governmental entities which allows the reorganization of such entities through a legal proceeding presided over by the United States Bankruptcy Court.

The filing was made with the federal court in Fresno on Sept. 30, and is pending before the Honorable Rene Lastreto II.

Kevin Northcraft, a member of the board, and current chairperson, commented, “We concluded that without filing chapter 9 and regaining control over the district’s operation the hospital would likely close.”

Sanford Haskins, newly appointed district manager, noted, “TLHCD seeks to reorganize and keep the hospital and clinics operating. Chapter 9 will best protect patients, employees andcitizens of the District. We are confident we can recover on unbilled receivables and increase our revenues to the point we can reorganize.”

The district’s general counsel, Tim Thompson of Mccormick Barstow in Fresno, said “By filing chapter 9 the district will be able to stay the many lawsuits against and be able to evaluate and reject unfavorable leases and contracts. This is like pressing a pause button”,

The district will be represented by Riley C. Walter of Walter Wilhelm Law Group of Fresno. Walter said, “By filing chapter 9 the district will have some much-needed breathing room and this will allow the board and staff to refocus on patient care and financial rehabilitation rather than putting out fires.”

According to Walter, the court will notify creditors of the filing, and the process of working out a plan of arrangement will start soon.

According to Haskins, “The hospital and clinics will remain open for business. We are ready, able and willing to provide quality medical services for the people of Tulare. The hospital and clinics are not closing. This is more the beginning than the end.”

Northcraft said, “The decision to file was not taken lightly. We deliberated about it and unanimously concluded that without breathing room we had to shut down. Chapter 9 gives us breathing room and hope. Tulare Local Healthcare District needs a hospital for its people.”