RADIOLOGY CENTER PURCHASE CONSIDERED.

Byline: Karen Maeshiro Staff Writer

LANCASTER - Antelope Valley Hospital officials are exploring the possibility of buying its leased radiology center, which is continuing to cost the hospital money and has slanted floors.

Director Steve Fox has requested a report on the feasibility of purchasing the $20.3 million, four-story facility, which opened last year.

``Nothing is definite,'' Fox said. ``The situation is this way: someone else built it, but we are financially responsible for it. If we owned it, those offices that are rented would become pure profit, as opposed to now, where we have to guarantee rent. Offices not rented become a liability.''

Officials said in August that the hospital had lost about $900,000 on the center, which was built without competitive bidding and is leased by a private firm to the hospital.

As the so-called landlord of the building, the hospital has to guarantee the rent, but many offices remain vacant.

The building is more than 48 percent occupied, according to minutes of a Dec. 22 hospital building and facilities committee meeting.

Fox said the hospital is short on rent by about $70,000 every month.

Fox at the committee meeting requested a report on the feasibility of using construction bond money toward buying the radiology center or toward other budgeted capital improvements.

Director Deborah Rice asked that the report include a breakdown of all expenses associated with owning the building, records show.

Rice also asked for a report on the building's fourth floor, which she described as ``noticeably slanted.''

``Lateral files, unless you lock them, they won't stay closed. There are cabinet doors that won't stay closed,'' Snow said.

Snow said the third floor slants as well and that a window on the third floor leaks, ``something we discovered three days after it was certified as water tight.''

The first and second floors also were slanted but were repaired before the building was occupied, Snow said.

Fox said the hospital was given $90,000 off of what was owed to the builder as part of a settlement.

The radiology center was built under a construction plan developed by the previous administration headed by ousted CEO Mathew Abraham and approved by the board in July 2001.

The 89,000-square-foot building houses the radiology center on the first floor and doctor's office space on the second and third floor.

The hospital plans to move other hospital operations, such as information services, Sexual Assault Response Service and the Gift Foundation, from the skilled nursing facility to the fourth floor, officials said.

The project was financed as an ``off-balance sheet'' transaction as a way to preserve the hospital's cash, records show. Hospital officials at the time said the hospital would lease the building for a number of years and then purchase it at the end of the lease.

``We use other people's money to build the building and pay it off over time,'' Gary Hill, then-hospital director, said at the time.

Hospital officials said it's a different way of financing but common in the industry.