Legislative Management advances emergency bridge-loan proposal for Jacobson Memorial Hospital

Chairman Hogue and legislative management advanced legislation to allow interim bridge loans intended to prevent the immediate closure of Jacobson Memorial Hospital.

Senator Shively, the prime sponsor, told the committee the hospital faces a “perfect storm” of administrative turnover, billing problems and debt that make continued operation unlikely without state help. He said the draft would authorize a $10,000,000 statewide pool "with loans up to $5,000,000 for a nonprofit facility of population under 2,500 people, for 11 years with only the interest being charged the first year." Shively also noted the bill includes a short application window and an expiration date tied to the program (application period through 06/30/2027).

Supporters framed the request as urgent. Shively said the failing hospital would have cascading effects on ambulance services, local tax bases and long-term community health capacity. Representative Fralick and others asked whether the proposal expands an existing infrastructure program or simply provides operating bridge loans; Shively said the Bank of North Dakota advised carving the assistance from an existing medical facility infrastructure loan mechanism and that repayments would be returned to that fund.

Committee members probed eligibility and oversight. Representative Bosch asked why the draft uses the term "medical facility infrastructure" when the need is operational; Shively said the drafting language was intended as cleanup and does not change the program’s intent. Senator Beckettall asked whether private or bank-led bridge loans had been exhausted; sponsors replied they had explored local options and that the hospital’s debt load and vendor demands make state action the most likely way to avoid immediate closure.

After discussion Leader Lafour moved to advance the bill to introduction and Representative Hauck seconded. The committee voted to move the proposal forward for the special session and, if approved later, it would be referred to appropriations for fiscal review and potential amendments.

What happens next: the bill will go to formal introduction and—if introduced—likely to the appropriations process for fiscal analysis of the $10 million authorization and to the Bank of North Dakota for program rules and loan administration.

Notes: Loan terms and the application deadline are drawn from sponsor testimony. The committee advanced the item but did not adopt final policy details; the Bank of North Dakota retains discretion over individual loan decisions.