HomeMy WebLinkAboutReso 1996-18487 NOT APPROVED
Continued Indefinitely
RESOLUTION NO. 18487
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA
VISTA CONCEPTUALLY APPROVING THE TENTATIVE
AGREEMENT BETWEEN THE CITY OF CHULA VISTA AND
SHARP HEALTHCARE FOR THE PURPOSE OF SATISFYING
SHARP'S CONTRACTUAL OBLIGATIONS TO THE CITY
WHEREAS, in May 1996 staff informed the City Council of a letter of intent between
Sharp Health Care and Columbia/HCA to begin discussions which, if successful, would result
in the conversion of Sharp Chula Vista from a non-profit to a for-profit hospital; and
WHEREAS, staff has been monitoring the discussions between Sharp and Columbia
since mid 1995 to determine what impact they would have on the contractual obligations
Sharp has to the City of Chula Vista and to the provision of health care/hospital services to
our citizens; and
WHEREAS, as a result, staff, working with Deputy City Attorney Googins, concluded
that Sharp was contractually obligated to pay the City 10% of the "net profit" of the
transaction between Sharp/Columbia; and
WHEREAS, staff has recently concluded negotiations with Sharp Health Care
representatives regarding a tentative agreement to satisfy Sharp's contractual obligations with
Chula Vista; and
WHEREAS, the general parameters of the proposed agreement provides the City with
(a) a cash payout at the close of escrow between Sharp/Columbia (b) an agreement to
continue to operate the Sharp Chula Vista Hospital as an acute care facility through the year
2008 (c) an extension of medical benefits with accruing interest through the year 2008 (d)
guarantees regarding Chula Vista representation on the new non-profit Board and (e)
guarantees for Chula Vista regarding potential "upside" gains related to the future sale of
Sharp's remaining 50% interest in the new entity.
NOW, THEREFORE, BE IT RESOLVED the City Council of the City of Chula Vista does
hereby conceptually approve the tentative agreement between the City of Chula Vista and
Sharp Healthcare for the purpose of satisfying Sharp's contractual obligations to the City.
BE IT FURTHER RESOLVED that staff is hereby directed to return with a contract,
which implements the tentative agreement, for forma approval by the City Council.
Presented by Approved as to form by
Sid Morris Ann Y. Moore
Assistant City Manager Acting City Attorney