Lane County commissioners are set to revisit a request from QKA Health Corp., doing business as Healthside Partners, to approve $179 million in tax‑exempt bonds that would finance the conversion of McKenzie‑Willamette Medical Center into a nonprofit organization. The proposal, first heard at a public hearing on Nov. 3, also includes financing for a planned 16,000‑square‑foot satellite emergency department in Eugene.
Background of the transaction
McKenzie‑Willamette is currently owned by Quorum Health, a for‑profit system backed by private‑equity firm GoldenTree Asset Management. Under the deal, QKA Health Corp. would purchase Quorum’s assets for $942 million, funded through a mix of public and private financing. The broader bond package for all of Quorum’s Oregon properties totals $1.1 billion, with $179 million tied specifically to the Springfield hospital and related projects.
James W. Blake, board chair of QKA Health Corp., described the conversion as a shift of eleven hospitals in nine states from for‑profit to charitable nonprofit status. He highlighted that any excess revenues would be reinvested in local health services rather than paid to equity owners, and that a portion of the bond proceeds would support the new emergency department.
County’s role and financial considerations
Federal law requires a local jurisdiction’s approval for tax‑exempt bonds, so Lane County must hold a hearing and vote on the request. County counsel, Hawkins Delafield & Wood LLP, concluded that the county would not be financially liable for the bonds beyond conducting the hearing.
Nevertheless, commissioners are concerned about the loss of property‑tax revenue that would result from the nonprofit exemption. Estimates indicate a $2 million annual reduction in tax receipts for local governments, with Springfield potentially losing about $808,000—$598,000 of which funds the general fund and $210,000 earmarked for police and fire services.
Hospital’s financial health and community impact
McKenzie‑Willamette reported a net loss of $14.9 million in 2025 after posting profits in 2023 and 2024. Hospital CEO Mark Robinson told commissioners the facility is operating “paycheck‑to‑paycheck,” facing weekly decisions about paying staff, anesthesia, and even food services.
Robinson and Quorum CEO Chris Harrison argued that the nonprofit conversion would stabilize the hospital, preserve essential services—including emergency, trauma, intensive care, birthing, pharmacy, imaging and laboratory—and keep the hospital board at a minimum of nine members, as required by the Oregon Health Authority’s conditional approval.
Community response
Springfield assistant city manager Niel Laudati emphasized the importance of the hospital to public safety and urged commissioners to weigh the potential tax‑revenue loss against the community benefits of a stable, nonprofit health provider.
Commissioners took no action at the Nov. 3 hearing and plan to reconvene on Nov. 17 to consider the bond request, the nonprofit conversion, and the associated fiscal impacts.
What’s next
If approved, the bond issuance would enable QKA Health Corp. to acquire the hospital assets and fund the satellite emergency department. The Oregon Health Authority’s conditional approval remains in effect for five years, after which the nonprofit’s debt sustainability will be reassessed.
Lane County residents can submit comments during the public hearing period, and the commissioners will weigh both the promised community benefits and the projected loss of property‑tax revenue before making a final decision.
Original reporting: Homepage – Lookout Eugene-Springfield — read the source article.
