Report 2018-102 Recommendation 6 Responses

Report 2018-102: Tulare Local Healthcare District: Past Poor Decisions Contributed to the Closure of the Medical Center, and Licensing Issues May Delay Its Reopening (Release Date: October 2018)

Recommendation #6 To: Tulare Local Healthcare District

To ensure that the district budgets for all costs necessary to reopen, it should immediately include in its budget the costs to pay pre-petition debt for vendors with whom it must reestablish relationships before it can resume operations.

6-Month Agency Response

The 60 day response remains valid, though the completion date was extended by 2 months.

  • Estimated Completion Date: December 2019
  • Response Date: April 2019

California State Auditor's Assessment of 6-Month Status: Pending

The district reopened the medical center on October 15, 2018, subsequent to the issuance of our audit report on September 9, 2018. As the district states in its 60-Day response, the actual amounts of pre-petition debt are not yet established and expected to take until late 2019. Therefore, we have assessed the response as pending.


60-Day Agency Response

These items were addressed at the time of the state audit and prior to issuance of the state audit report. The hospital is open. The items largely are completed, though negotiations with some vendors continue.

Budget estimates always have included, and will continue to include, costs to resolve bankruptcy debt issues with vendors needed to continue hospital operations. However, the actual amounts of pre-petition debt will not be established until formal approval of a bankruptcy plan by the Bankruptcy Court. The District expects that process to take until late 2019.

  • Estimated Completion Date: October 2019
  • Response Date: December 2018

California State Auditor's Assessment of 60-Day Status: Pending

The district reopened the medical center on October 15, 2018, subsequent to the issuance of our audit report on September 9, 2018. As the district states in its response, the actual amounts of pre-petition debt are not yet established and expected to take until late 2019. Therefore, we have assessed the response as pending.


All Recommendations in 2018-102

Agency responses received are posted verbatim.