The Muskogee Medical Center Authority, which is in charge of managing the lease for the Muskogee hospital, has sued Saint Francis Hospital and Capella, saying the healthcare providers have failed to fulfill the lease they signed by not paying “in-kind” payments which replace property taxes they would otherwise pay.
The amount in arrears is $655,022 from 2018 — but that is expected to increase in February, when Saint Francis has indicated they will not pay for the 2019 year either.
“Pursuant to section 4.4 of the Lease Agreement, in kind payments must be made to the Muskogee County Treasurer,” the lawsuit states. Saint Francis “is in default by the failure to cure within 30 days after notice ... Written notice of default was provided to Defendants on September 4, 2019.”
Saint Francis has steadfastly refused to pay the money, arguing that it is a nonprofit, and therefore not subject to taxes. However, it signed the lease agreeing to the in-kind payments, which are not taxes, but an agreed-to payment the hospital is supposed to make to support education in Muskogee.
“The in kind payment provides vital funds for county health initiatives, the City of Muskogee and Muskogee public libraries, and is a material source of funding for Muskogee Public Schools,” the suit states.
The healthcare authority is asking for Saint Francis and Capella, which has never been released from its responsibility for the in-kind payments, to be held liable for all future in-kind payments for the remainder of the lease.