Shutdown jeopardizes Pecos Valley Medical Center expansion

January 25, 2019

U.S. Rep. Ben Ray Luján made a recent appeal to U.S. Agriculture Secretary Sonny Perdue emphasizing the importance of a medical center expansion in Pecos.

The project, funded in large part with a federal loan from the Department of Agriculture, would boost job opportunities in the area and allow the center to increase vital trauma treatment programs, enroll more patients in Medicaid and provide space for after-school activities, said Luján, a Northern New Mexico Democrat.

The Pecos Valley Medical Center expansion is critical, he wrote, “not only to the local Pecos community and residents, but to the entirety of San Miguel County.”

But the project is relying on the release of federal funding amid a partial government shutdown with no end in sight.

Like hundreds of thousands of other federal workers, Agriculture employees are furloughed, leaving no one to approve the medical center’s payments to Albuquerque-based Jaynes Corp., the construction contractor.

If the federal agency doesn’t process invoices for the project this week, Luján wrote, the construction contract could be left in jeopardy, leading to a delay in the completion date and a significant increase in costs.

More than a month after President Donald Trump called for a federal shutdown amid a dispute with Congress over his demand for $5.7 billion to build a wall along the U.S. border with Mexico, it’s become increasingly difficult for local organizations to navigate the building process for projects funded with federal money.

The Pecos Valley Medical Center received a $3.2 million loan in September from the Department of Agriculture to complete the long-awaited, 9,000-square-foot expansion, which includes a new dental wing and behavioral health wing as well as administrative offices. Officials have said the goal of the project is to further create a holistic approach to health care in the community, bringing a range of services into one building.

But it has struggled to pay construction contractors and subcontractors.

Medical center CEO Kevin Norris learned Thursday that the project would receive some stopgap funding in the form of a $100,000 line of credit from Los Alamos National Bank, which would cover wages for work completed at least through Dec. 31. But he and other administrators fear the project eventually could come to a halt.

“We are kind of stuck until something happens with the shutdown,” Norris said. “It’s disappointing. … It’s hard being in limbo.”

Michael McDonald, a Jaynes Corp. project manager, said his team will issue a second letter to the Agriculture Department at the end of the month, alerting the agency that the firm hasn’t received payment. If the company is not paid 15 days after that, he said, it will have to consider how to proceed.

Basically, he said, “if the government shutdown continues for the next few weeks, then there’s there’s potential we’ll pull out in March.”

Both Norris and McDonald said workers will stay on the project until at least Feb. 21.

The expansion project has been in the works for at least two years, Norris said. Initially, it was on track to be completed in August, but now “it could be September, it could be October. … We have no clue.”

In San Miguel County, which is saturated with issues such as drug and alcohol abuse, diabetes and poverty, improving medical care is essential, Norris said.

McDonald agreed. “It is very important to the community, and they’ve been working hard,” he said.

As structural steel and concrete arrive at the site, McDonald said, there will be an increased need for the federal funds to cover materials costs and to pay a higher number of workers.

“We want to move forward,” he said, “but if we don’t get payment, we can’t hold on much longer.”