Northern Berkshire Healthcare Files Chapter 11 Bankruptcy

By Tammy DanielsiBerkshires Staff
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NORTH ADAMS, Mass. — Northern Berkshire Healthcare filed for Chapter 11 protection in U.S. Bankruptcy Court in Springfield on Monday.

Chief Executive Officer Richard Palmisano said the filing will not affect patient care or employees.

"In reality, from the standpoint of the consumer, there will be no change. For staff, there will be no change; they will continue to get their paychecks and their pension benefits," Palmisano said on Monday.

The move had been long expected as the health-care system struggled to get a handle on its nearly $50 million debt burden and its pension liabilities. Last week, it reorganized its administration, splitting Palmisano's jobs of CEO and president and adding on the duties of a "chief restructuring officer" to concentrate on the system's finances. William "Bill" Frado Jr., a member of the board of trustees, was named president while Palmisano retained his post as CEO.

NBH had been in "very intensive" discussions with bondholders over the past six to nine months, said Palmisano on Monday. The bond debt is related to major improvements and expansion at North Adams Regional Hospital and the purchase of two nursing and retirement community facilities in Williamstown that have since been sold off at a loss.

Last week, the hospital tendered another debt restructuring proposal that was not taken up by bondholders.

"We concluded that the bondholders were not understanding our situation clearly, so we put together a proposal of where we wanted to go," Palmisano said. The bondholders responded with a counterproposal "that clearly told us they weren't understanding our situation."

The hospital had prepared filings twice before but held off in hopes of reaching an agreement. Officials felt now was the appropriate time to seek court protection.

Prior debt is now frozen while the court reviews the matter; Palmisano said all current debt must be paid COD, or cash on delivery. "So what we buy, we have to pay right way," he said. "We have been working diligently to ensure we have the resources until we emerge from bankruptcy."

He estimated it would take six to seven months, although it could move faster. "The court will understand the importance of this institution and that the protected restructuring process will make it harder for us to continue to provide services to this community."

At the same time, the hospital will continue to move forward with moving its pension funds to the federal Pension Benefit Guaranty Corp. It is still seeking a health-care partner to affiliate with and pursuing federal Critical Access Hospital status, which could bring more funding into the system.

"I think what is critical is that people hear the word bankruptcy, they think of liquidation," said Palmisano. "That's not the case here. I think a better analogy would be what happened when General Motors emerged from bankruptcy with a level [of debt] they could sustain."

Even with the restructuring, the hospital will never be a wealthy institution because of the region's demographics. But it can be a healthy and quality institution, Palmisano said.

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Williams Seeking Town Approval for New Indoor Practice Facility

By Stephen DravisiBerkshires Staff
WILLIAMSTOWN, Mass. — The Planning Board last week gave Williams College the first approval it needs to build a 55,000-square foot indoor athletic facility on the north side of its campus.
 
Over the strenuous objection of a Southworth Street resident, the board found that the college's plan for a "multipurpose recreation center" or MRC off Stetson Road has adequate on-site parking to accommodate its use as an indoor practice facility to replace Towne Field House, which has been out of commission since last spring and was demolished this winter.
 
The college plans a pre-engineered metal that includes a 200-meter track ringing several tennis courts, storage for teams, restrooms, showers and a training room. The athletic surface also would be used as winter practice space for the school's softball and baseball teams, who, like tennis and indoor track, used to use the field house off Latham Street.
 
Since the planned structure is in the watershed of Eph's Pond, the college will be before the Conservation Commission with the project.
 
It also will be before the Zoning Board of Appeals, on Thursday, for a Development Plan Review and relief from the town bylaw limiting buildings to 35 feet in height. The new structure is designed to have a maximum height of 53 1/2 feet and an average roof height of 47 feet.
 
The additional height is needed for two reasons: to meet the NCAA requirement for clearance above center court on a competitive tennis surface (35 feet) and to include, on one side, a climbing wall, an element also lost when Towne Field House was razed.
 
The Planning Board had a few issues to resolve at its March 12 meeting. The most heavily discussed involved the parking determination for a use not listed in the town's zoning bylaws and a decision on whether access from town roads to the building site in the middle of Williams' campus was "functionally equivalent" to the access that would be required under the town's subdivision rules and regulations.
 
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