Of the $23.7 million in grants from the Fraser Fort-George Regional Hospital District to Northern Health in the district approved 2024 budget, only just over $9 million had been paid out by the end of November.
That’s according to a report to hospital district directors presented at their final meeting of 2024 on Dec. 19. All members of the Fraser Fort-George Regional District’s board of directors are also members of the regional hospital district board.
Directors also got a look at the provisional budget for 2025 through 2029, which proposes a 4.9 per cent increase to its tax requisition for 2025 and a 2.6 per cent increase each year for 2026 through 2029.
Those figures are based on a long-term financial plan developed when the district’s funding for the new acute care tower at the University Hospital of Northern British Columbia was approved.
The spending report shows that a total of $23,733,980 in grants was approved for 2024, broken down into these categories:
- Prior year commitments: $7,313,670,
- Major projects — continuation of prior year projects: $7,189,600,
- Major projects — new: $7,189,600,
- Building integrity — $100,000,
- Minor equipment (worth less than $100,000): $1,100,000,
- Information technology: $391,613,
- Major equipment: $1,571,200 and
- Early works — Year 1: $4,400,000.
As of Nov. 30, payments in those categories totalled $9,056,493:
- Prior year commitments: $2,727,642,
- Major projects — continuation of prior year projects: $769,407,
- Major projects — new: $0,
- Building integrity — $100,000,
- Minor equipment (worth less than $100,000): $1,100,000,
- Information technology: $0,
- Major equipment: $230,954 and
- Early works — Year 1: $4,128,490.
That means that as of the end of November, there was a $14,677,487 variance from the 2024 approved budget. That’s a surplus of 61.8 per cent.
Of that figure, $8,170,443 was said to be related to the timing of payments and the remaining $6,507,045 from the board decommitting to projects or from bylaws not being requested or not approved yet. The former figure will be accounted for in the 2025 budget in the “prior year commitments” category.
Sarah White, general manager of financial services, wrote in the report that the district is expecting $870,000 more in spending from approved bylaws by the end of December.
Funding bylaws approved at the Dec. 19 budget will be added to the prior year commitment category as well.
“The delayed timing of cash spending during the 2024 year, along with anticipated funds being carried forward for a future fiscal year allows opportunities to transfer more funding into reserves at the fiscal year-end and increase investment returns on these reserve funds,” the report said.
That spending includes just over $1.1 million for a new Hawkeye nuclear medicine machine. That includes $240,000 being spent from the district’s 2024 budget and $862,000 from the 2025 budget.
The hospital board postponed a decision on a spending request by Northern Health worth more than $1 million for renovations at UHNBC’s hematology lab department.
The request was for $80,000 in spending from the 2024 budget and $1,000,000 in the 2025 budget. That would represent a 40 per cent contribution to the project, with Northern Health providing the other $2,700,000.
The third and final additional spending requested considered at the Dec. 19 meeting was $864,000 from the 2024 budget requested by Northern Health as a contribution towards improvements to a medical specialist clinic in Prince George. The project’s total cost is $2,162,000.
“This project will renovate space in the Parkwood Mall in Prince George to accommodate some programs that are moving out of UHNBC as part of the Cardiac expansion in the hospital,” said a letter from Northern Health requesting the funding.
Director Art Kaehn advocated for delaying the decisions on the three purchases because it would impact the funding cap in 2025 and there were no Northern Health representatives present to explain their importance.
The regional district’s chief administrative officer, Chris Calder said that when Northern Health makes these kinds of funding requests, they are made in the order of their importance.
“I would say, though I can’t speak to which one of the three is more important than the others, but I do think all of these are of urgent need,” Calder said.
For the specialist clinic funding, Director Danniele Alan (Electoral Area H), said she would vote against the proposal.
“It’s been pointed out that it’s been done all over the place,” Alan said. “It doesn’t make it necessarily right that we’re using public money to benefit a privately-owned business.”
Director Victor Mobley (Electoral Area A) followed-up Alan’s comments by saying it is common practice for a lessee to pay for renovations for a space they are leasing, but typically this is done when there is a long-term agreement in place. He said he would like to know how long Northern Health’s lease will last.
That expenditure was approved.
White said later that at the hospital board’s November meeting, directors voted to reduce the district’s capital contribution towards purchases of major equipment and major projects worth more than $100,000 to 21.63 per cent from its current 40 per cent.
In November, Northern Health requested a preliminary amount of $12,621,244 for those spending categories in 2025. With the funding reduction, the hospital district’s contribution would instead be $7,018,285.
Calder, said this was discussed at a recent with Northern Health back in October and the health authority was understanding of the limit.
“I wouldn’t say they’re thrilled about that, because they have larger requests, but I think there’s understanding about the cost pressure we have and I believe by doing it through the annual cap route is the best way for them as well, to be able to plan it out,” Calder said.
Regarding the provisional budget, directors discussed the path moving forward when it comes to funding requests by the health authority.
Hospital district Chair Joan Atkinson (District of Mackenzie) said she, Director Kyle Sampson (City of Prince George) and Calder had a meeting with Northern Health a couple of weeks prior to discuss how the district can have “a little more skin in the game and not just be looked at just as a funding partner.”
Director Brian Skakun (City of Prince George) said he thought residents should know that the regional district and the hospital board are pushing back on capital requests from the health authority.
The provisional 2025 to 2029 also includes a four per cent compensation boost for both the hospital district board’s chair and acting chair as well the same amount for administration expenses.
There’s a two per cent increase for the district’s minor equipment grant while the annual building integrity funding grant is staying put at $100,000.
The 2025 annual budget will be presented to the hospital direct board at its March meeting.
Between now and then, staff said in their report that tax requisition, transfers for the capital reserve fund’s revenue, major projects and equipment expenditures, prior year commitments and transfers to the capital reserve fund are expected to change from the provisional budget.
