Ch. 789

LAWS OF MARYLAND

whereby the outstanding indebtedness may be prepaid

requiring approval of the agreement by the Legislative
Policy Committee of the General Assembly; and relating
generally to the acceptance of prepayments of a prepayment
agreement for certain debts of Liberty Medical Center, Inc.

Preamble

WHEREAS, In 1986, Liberty Medical Center, Inc. acquired the
assets of Lutheran Hospital of Maryland, Inc. and Provident
Hospital, Inc. and began operation of a consolidated institution
in Baltimore City; and

WHEREAS, The State of Maryland made certain loans to
Provident Hospital in 1969 and 1974; and

WHEREAS, Liberty Medical Center, Inc. agreed under an
Assumption and Subordination Agreement dated July 30, 1986, to
assume the indebtedness of Provident Hospital then owing to the
State in the amount of $6,764,642; and

WHEREAS, In 1986, the State also loaned to Liberty Medical
Center, Inc. an additional subordinated below market rate loan of
$2,500,000; and

WHEREAS, Liberty Medical Center, Inc. has made timely
payments on all the other outstanding indebtedness to the State
in accordance with its agreements with the State; and

WHEREAS, Liberty Medical Center, Inc. has kept its rates and
charges at reasonable levels while serving one of the highest
census levels of poor and indigent in Maryland; and

WHEREAS, The consolidation which created Liberty Medical
Center, Inc. has contributed substantially to the attainment of
the bed reduction goals for Baltimore City; and

WHEREAS, Liberty Medical Center, Inc. is serving an
extraordinary number of patients who are indigent and recipients
of Medicaid assistance; and

WHEREAS, Liberty Medical Center, Inc., because it has
achieved a position of financial solvency, is now in a position
to obtain conventional financing in the private sector; and

WHEREAS, It is in the best interest of Liberty Medical
Center, Inc. to restructure its outstanding debt to the State of
Maryland by the use of long-term bond financing; and

WHEREAS, The outstanding loans to the State of Maryland are
below current market rate; and

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