The fund established by Dartmouth-Hitchcock Medical Center to help pay for the city services it uses and its impact on the community will be exhausted by 2003 if current spending patterns continue.
According to DHMC's Vice President of Regional Planning Steve Marion, the $2-million trust fund had been growing until last year when Lebanon city officials saw the fund as an opportunity to fund public works projects. The money in the fund was intended for use over a period of 10 years. At that time, Lebanon city officials speculated development around the DHMC would raise $2 million per year in tax revenues.
The decision to use the fund directly to pay for public works has led to faster depletion of the money, Marion said.
The fund is "falling below the $2 million and the draw on it will be eating up all the interest and eating into the principle," Lebanon City Assessor Norman Bernaiche said.
The DHMC gave the fund to the city of Lebanon in 1991 to address the financial impact the medical center would have on the city when it moved there, Bernaiche said.
He said the money in the fund facilitated the move, enabling the city council to change the city's zoning and the city boards to approve the project.
Currently, the $2-million fund is supplying the DHMC with public services such as police, fire and clerks, as well as being used to finance public works.
Marion said not all of the expenses are related to the DHMC.
"I think the city should pick up those costs," he said.
Marion said DHMC officials would be willing to discuss these costs.
"It's not our fund ... [but] we'd be very happy to sit down with the city if there are more [community] impacts" that need to be addressed by the fund, Marion said.
Bernaiche said, "If the DHMC doesn't contribute any money then it'll come out of the regular city budget."
Lebanon has not been able to raise the tax revenues, which the city had predicted would be sufficient to offset the DHMC's cost to the city.
According to the Valley News, Centerra, the office park located near the DHMC, has not provided substantial tax revenue because it houses a post office and courthouse -- both of which are non-profit and not taxable.
Although there are plans to build a health club and co-op at Centerra, these alone will not provide enough tax revenue to compensate for the depletion of the fund, Bernaiche said.
The city is considering soliciting payments from non-profit organizations situated around the DHMC and has discussed taxing the hospital itself, Bernaiche said.
Despite Lebanon's difficulty in raising tax revenues in the area around the DHMC, both Marion and Bernaiche are optimistic that the land around the medical center will eventually attract investment from businesses.
"I would hope that beyond the year 2000 ... the Route 120 corridor will more than offset the expense to the city." Marion said.
Bernaiche echoed Marion's statement.
"Someday, it'll be a good development up there," Bernaiche said.