Defendants' Motion to Dismiss

     [||fb4fa382-2afe-46c5-90c6-64372c994a0f||] ® * 
IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF INDIANA 

HAMMOND DIVISION 

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 3 

BARBARA LEEK WESSON, 

BERNICE TERRY, 

EDDIE GRAY, 

AND ROSA KEETON, 

Plaintiffs 

VS. CAUSE NO. H 76-373 

METHODIST HOSPITAL OF 

GARY, INC., An Indiana 

Not-For-Profit 

Corporation and DAVID 
MATTHEWS, Secretary Dept. 

of Health, Education and 

Welfare of the United 

States of America, 

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Defendants 

MOTION TO DISMISS 
  

I. 

Comes now the defendant, Methodist Hospital of Gary, 

Inc., and moves the Court pursuant to Rule 12(b) of the 

Federal Rules of Civil Procedure to dismiss this cause upon 

the following grounds: 

1. That this Court lacks jurisdiction of the subject 

matter herein as the Complaint shows, on its face, that the 

controversy described therein is one within the exclusive 

jurisdiction of the Department of Health, Education and 

Welfare acting pursuant to 42 U.S.C. Sections 291 to 291-0; 

and, as neither 42 U.S.C. Section 20004 et seq. nor 5 U.S.C. 

Section 701 et seq. grant this Court jurisdiction of the 

subject matter raised herein; and, as the actions of the 

defendant Methodist are not "State" actions within the 

meaning of the Fourteenth Amendment to the Constitution of 

the United States of America. 

2. That plaintiffs have failed to state a claim upon 

which relief can be granted in that plaintiffs have failed 

 



    

® p 
to exhaust their administrative remedies granted by 45 

C.F.R. Section 80 et seq., promulgated under 42 U.S.C. 

Section 20004 et seq.; that plaintiffs have no standing to 

bring this suit as plaintiffs have failed to allege and show 

that they are "persons aggrieved" within the meaning of 5 

U.S.C. Section 707 and plaintiffs have failed to allege and 

show that they have suffered some actual injury and are 

within the zone of interests sought to be protected or 

regulated by Congress sndiod 42 U.S.C. Section 20004, and 42 

U.S.C. Section 291 et seq.; that the agency action involved 

herein has not reached that stage of finality that is a 

required prerequisite for such judicial review as is authorized, 

i.e. that the cause is not "ripe" for judicial Yeview and, 

that this Court should decline jurisdiction in favor of the 

Department of Health, Education and Welfare. 

3% That this Court lacks jurisdiction over the person 

of the defendant, David Matthews, in that this suit, though 

nominally against the individual David Matthews, is, in 

actuality, one against the sovereign United States of America, 

which has not consented to said suit. 

WHEREFORE, defendant, Methodist Hospital of Gary, Inc., 

prays that this action be dismissed. 

RESPECTFULLY SUBMITTED, 

HODGES, DAVIS, GRUENBERG, COMPTON & SAYERS 

  

EDWARD J. HUSSEY 
5525 Broadway 
Gary, Indiana 46410 
Ph. 981-2557 

REC RY ST HOSPITAL OF GARY, INC. 
- / J 

2 \ H ry y 

BY: S iia £) A Ltd ll 

/ 

11. 

Comes now the defendant, Methodist Hospital of Gary, 

Inc., and moves the Court pursuant to Rule 23 (c) and (d) of 

the Federal Rules of Civil Procedure to:  



4 * 

  

1. Enter an order determining that this action should 

not be brought as a class action as the claims of the named 

plaintiffs herein are not typical of the claims of the class 

of citizens sought to be protected under 42 U.S.C. Section 

291 et seg. or under 42 U.S.C. Section 20004 et: seq. (the 

statutory authority involved herein); nor are the representative 

plaintiffs named herein likely to fairly and adequately 

protect the interests of the class; or, in the alternative, 

should the Court find that the named plaintiffs are fairly 

representative of the class sought to be represented: 

2. Require the plaintiffs herein to provide written 

notice of the proceedings herein to each identifiable member 

of the class the plaintiffs purport to represent as the 

relief sought herein would tend to have a substantial adverse 

impact on the availability and quality of the health care 

provided for the citizens of the City of Gary and surrounding 

communities and unincorporated areas of Northwest Indiana. 

RESPECTFULLY SUBMITTED, 

HODGES, DAVIS, GRUENBERG, COMPTON & SAYERS 

ATTORNEYS Zon METHODIST HOSPITAL OF GARY, INC. 
/ 

BY: SG all Vi LAB (tL 1) X / 2 Jf ALT 
J     

EDWARD J. HUSSEY ¢ 7 
5525 Broadway 
Gary, Indiana 46410 

Ph. 981-2557 

 



  

3 

= 

IN THE UNITED STATES DISTRICT COURT 
. FOR THE NORTHERN DISTRICT OF INDIANA ~~; 

HAMMOND DIVISION “ig 

: Rie, BARBARA LEEK WESSON, ) sit L197, 
BERNICE TERRY, ) Bre se 
EDDIE GRAY, ) U. o * GRA 
AND ROSA KEETON, ) » Disp NOys™ 

) or CC tt Plaintiffs ) a> 
) 

VS. ) CAUSE NO. H 76-373 
) 

METHODIST HOSPITAL OF ) 
GARY, INC., An Indiana. . ) 
Not-For-Profit ) 
Corporation and DAVID ) 

MATTHEWS, Secretary Dept. ) 
of Health, Education and ) 

‘Welfare of the United ) 

States of America, ) 

: ) 
Defendants ) 

. AFFIDAVITS, MEMORANDUM AND ARGUMENT IN OPPOSITION     

  

I. 

PRELIMINARY STATEMENT 

The defendant, Methodist Hospital of Gary, Inc. (hereinafter 

Methodist) by this Memorandum of Law and Argument and the 

attached Affidavits in support hereof records its opposition 

to the plaintiffs’ Motion for Summary Judgment and takes 

issue with the allegations made by the plaintiffs in their 

verified Complaint filed in the office of the Clerk of this 

Court on December 29, 1976. The defendant will detail as 

grounds in support of its opposition to the plaintiffs? 

Motion: 

J. That this Court lacks jurisdiction to grant the 

requested preliminary injunctive relief. 

2. That the plaintiffs failed to comply with Federal 

Rule of Civil Procedure Rule 6(d) and (e) in giving a Notice 

of the hearing on plaintiffs' Motion. 

3 That the plaintiffs fda failed by their verified 

Complaint to demonstrate a probable right to a Preliminary 

Injunction.    



he 3) 

  

4g, That the plaintiffs have failed by their verified 
Complaint to demonstrate the probability that their right to 
injunctive relief will be defeated unless a Preliminary 
Injunction is issued; and, 

5. That the plaintiffs have failed by their verified 
Complaint to demonstrate that the damage to Lhe plaintiffs 
in the absence of the Preliminary Injunction outweighs the 
substantial foresceable harm to the defendant Methodist, if 
the preliminary injunction is granted. 

11. 

LACK OF JURISDICTION TO GRANT THE REQUESTED RELIEF 
The defendant, in support of its opposition to plaintiffs: 

Motion for Preliminary Injunction, reiterates and incorporates 
herein the arguments and authority advanced in Paragraph IT 
of its Memorandum in Support of its Motion to Dismiss. 
Defendant believes that it has sufficiently demonstrated 
this Court's lack of jurisdiction of the subject matter 
herein by the materials cited in that Memorandum. That Rule 
65 does not purport to confer jurisdiction on ‘the Dis strict 
Court is clear. The rule concerns itself only with the 
Procedural aspects of equitable injunctive relief, 
Lodge No. 95 vv. Delaware L & W R. CO.,-3%9 rr. Supp. 456 

g DS —— EX A 2. LO. 
(M.D.Pa. 1941); Peterson v. Sears, 238 rp. Supp. 12 (N.D.Iowa 

dl Vs SCAG 
1964); Aldens Inc. v. Packel, 379 F. Supp. 521 (M.D.pa. 
1974). 

| In addition, the defendant would reiterate its arguments 
made in Paragraph III of its Memorandum in support of its 
Motion to Dismiss that plaintiffs must exhaus 
remedies prior to sceking injunctive relief under Rule 65. 
Kule 65 does not relieve plaintiffs of their roquirdnane to 
exhaust administrative remedies. Natural Gas Yineline Cr 
Slattery, 302 U.S. 300, 82.1..kd. 27¢ (19373. 

Moses Taylor 

t their administrative 

 



A 

  

11x. 

PLAINTIFFS' FAILURE TO GIVE PROPER NOTICE 

(a) Preliminary Injunction 

{1) Notice. No preliminary injunction shall be 
issued without notice to the adverse party. 

Rule . 65(a) (1) F.R.C.P. 

The Rule itself does not specify what type of notice 

need be given nor does it specify the time perameters in 

which notice must be given. However, the Courts have found 

it clear that the Rule 6(d) and (e) requirements apply to 

Rule 65 notices. Pranz v, Franz, 15 F.28 797 {8th Cir.   

.1926); Marshall Durbin Farms inc. v. National Farmers Org. Inc 
  

£446 F.2d 353 (5th Cir. 1971). These rulcs require that a 

written motion and a written notice of a hearing thereon be 

sexved not later than five days before the time specified 

for the hearing unless a different period is specified by 

the Court. Rule 6(d). Rule 6(e) provides that if service 

is made by mail, "three days shall be added to the prescribed’ 

period". In addition, when the prescribed period is less 

than seven days, intermediate Saturdays, Sundays and legal 

holidays are to be excluded in the computation Rule 6 (a). 

As is disclosed by the "Certificate of Service" signed 

by Julian B. Allen, attorney for the plaintiffs herein, 

attached hereto and marked "Exhibit A" for reference, a copy 

of the Motion for Preliminary Injunction and Notice of 

Hearing thereon was not mailed to the attorneys for the 

defendant, Methodist Hospital, until January 19, 1977. 

After excluding an intervening Saturday and Sunday as provided 

by Rules, this is only three days prior to the hearing on 

said Motion for Preliminary Injunction set for January 24, 

1977. ‘It is further pointed out that thig Court did not 

order a reduction in the prescribed time. Furthermore, the 

“Fr 

 



  

I 
| 

defendant asserts that there is no Justification for Swe a 

failure to provide reasonable and adequate notice. The 

Motion for Preliminary Injunction was filed on December 29, 

1976, and the Notice of Hearing issued by this Court on 

January 4, 1977. 

(Defendant does point out that attorneys for defendant, 

Methodist, did file their Motion to Dismiss pursuant to a 

Court Order reducing the time for filing and serving such a 

Motion and Memorandum in Support thereof. However, attorneys 

for defendant, Methodist Hospital, did prepare and file said 

Motion as quickly as ‘was possible, and fully complied with 

the Court's Order reducing the prescribed time period pursuant 

to Rule 6(d).) 

Because of plaintiffs' failure to properly serve defendant 

with the Motion for Preliminary Injunction and Notice of 

Hearing thereon, defendant asserts that it has been unable 

to adequately prepare for such hearing. This Memorandum and 

Affidavits attached hereto have been hurriedly prepared and 

served. Defendant asks that this Court therefor deny plaintiffs" 

Motion. | | 

v. 
PLAINTIFFS' FAILURE TO ESTABLISH A RIGHT 

TO A PRELIMINARY INJUNCTION 

The purpose of a preliminary injunction is gencrally to 

preserve the status quo until the Court has. an opportunity 

to resolve the controversy at trial or otherwise. W. A. Mack 
    

inc. Vv. Genoral Motors Corp., 260°F.2d 836 (7th Cir. 1938), 
Thus, the determination of whether or not to grant such 

extraordinary relief requires a showing by the party requesting 

such volies that that party has a right to such relief, a 

need for such relief, and that failure to grant such relief 

will do that party immediate and irreparable harm. Sinclair 

Refining Co..v. Midland 0il Co., 55 P.24 42 {4th Cir. 1932);   
  

 



  

Ross Wnitney Corp. v. Smith Kline & French Lab., 207 F.2d 190     

(Sth Cir. 1953), 

The first requirement, that of a probable right to 

inSunoive relief, requires a showing that it is likely 

plaintiffs will prevail on the merits. Withrow v. Larkin, 

421 U.S. 357 ‘43 1,84. 2d 421 (1975); Mullis v. Arco Petroleum 
Corp., 500 F.2d 290 (2h Cir. 1974). 

a In the instant case, the 21:6) Lhic0 of the plaintiffs 

succeeding on the merits at trial is, the defendant asserts, 

non-existent. The plaintiffs’ assertion that Methodist has 

reduced x-ray services at its Gary location is refuted by 

the attached affidavit Of Dr. K. G. Ambrozaitis attached 
  

  

hereto as "Exhibit B". The plaintiffs' assertion that the 

"i
 

actions of Methodist Hospital over the last ten years demonstrates R—   
  

  

a plan to deprive the black citizens of Gary of proper 
  

  

medical care is refuted by the affidavit of Mr. Denis Ribordy,   

attached hereto as "Exhibit C". The plaintiffs' allegations 

that defendant has violated the civil rights of the various 

plaintiffs is refuted by the report of Mr. Alfred Sanchez of 

the Office for Civil Rights of the Department of Health, 

Education and Welfare attached hereto as "Exhibit D". Mr. 

Alfred Sanchez of that office has looked into the charges of 

civil rights violations by Methodist Hospital and found Chom 

4 to be without foundation. 

Thus, all of the factual bases on which the plaintiffs 

seek to ground their claim for injunctive relief are without 

foundation. However, in addition to the affidavits offered 

herewith, the plaintiffs themselves have demonstrated their 

lack of confidence in the outcome of this case. Their 

1{]
 

failure to exhaust available administrative remedies is a 

clear demonstration of the likelihood that plaintiffs would 

fail to succeed on the merits. Wallace wv. Lynn, 507 r.24 
  

  

 



  

1188 (n.C.Cir. 1974). 

For the foregoing reasons and based on the attached 

affidavits, defendant believes that it has demonstrated that 

the plaintiffs do not have the right to .a preliminary injunction 

Vv. 

THE PLAINTIFFS HAVE FATLED TO DEMONSTRATE IRREPARABLE HARM IF A PRELIMINARY INJUNCTION IS NOT GRANTED 

If the plaintiffs have demonstrated a right to injunctive 
% relief, i.e. likelihood of success on the merits, they have 

not demonstrated the probable danger that the right may be 
defeated unless the injunction is issued. This is a requirement 
Precedent to the granting of such a Preliminary injunction. 

. “x Sampson v. Murray, 415 U.S. 81,:-3%9 L.Ed. 2& 166 (1974); 
EY Sims v. Greene, 161 F.2d 87 (3d Cir. 1947). 

hs 

The plaintiffs have alleged no irreparable harm in 

their verified Complaint. What irreparable harm the plaintiffs 
could allege is not apparent to the defendant. The irreparable 
harm to the citizens of Gary if such an injunction is granted, 

. i.e. the immediate diminution in funds available to maintain 
the level of health care for all citizens is apparent and 

oN verified by the affidavit of Mr. Larry Mangold attached 
hereto as "Exhibit E". 

VI. 

THE PLAINTIFFS’ FAILURE TO DEMONSTRATE THAT THE HARM na 
TO THE PLAINTIFFS OUTWEIGHS THE DAMAGE 10 YHE DEFENDANT IF THE PRELIMINARY INJUNCTION IS GRANTED 

The final requirement to be met by the plaintiffs in 
“ their quest is that their need for the Preliminary injunction 

outweighs the harm to Methodist if the injunction is granted. 
- Selchaw & Righter £0. V. 
      

Western Printing & Lithographing Co., 
112 F.2d 430 (7th Cir. 1940). . This requirement calls for a 

: balancing of the rights of the plaintiffs and defendant. 
The Court should take care in welghin g this balance to 

 



    

insure that the Plaintiffs, if granted the preliminary 
injunction, do not gain all the actual advantage which could 
be gained from a final determination on the merits. Corica V. Rage xc ¥Y. Rage 140 F.2d 496 (7th Cir. 1944). 

In the instant case, it is clear that the ‘gain to the 
Plaintiffs would be final. The attached affidavit of Larry 
Mangold (Exhibit E) demonstrates that if the defendant does 

developed under the new loan guarantee program by September 28, 
1977, the defendant will be forced to begin the application 
process anew. This will effectively block the new loan 
guarantee program. 

The harm in monetary terms to both defendant Methodist 
and to the Federal government is substantial. The administrative 
Posts of phasing out ang Phasing in the interest subsidy 
Program are substantial. The costs in sacrificing work done 
to date on the new construction project, including architectural, 
hospital Planning and administrative and legal fees is 
likewise substantial. The additional loss to the vast 
majority of the citizens of Gary, both black and white, if 
such significant revenues are cE off requiring cut-backs in 
medical and health care must also be taken into account. 

This harm to the defendant is substantial in comparison 
to the as yet undefined harm to the Plaintiffs if the preliminary 
injunction is denied. The balance tips in, favor of the 
defendant and the Plaintiffs' Motion should be denied. 

VIX. 

SUMMARY 
The defendant submits this Memorandum and attached 

affidavits in support thereof in opposition to the plaintiffs’ 
Motion for Preliminary Injunction. These materials are not 
meant to be nor should they be read as a comprehensive 

   



  

T¢
 

response or answer to the allegations made in the plaintiffs? 
Complaint. 

The defendant would like to point out to the Court that 
the affidavits Presented to the Court by the defendant are 
the affidavits of individuals experienced in the medical and 
health care fields. These individuals are daily confronted 

with determinations as to the use and distribution of variou 
medical equipment and techniques. Defendant further points 
out to the Court that the representative plaintiffs herein 
are not familiar with the day to day utilization of health 
care facilities nor are they in a position to advise this 
Court on the proper distribution and utilization of health 
care facilities and medical equipment. 

The plaintiffs have failed by their verified Complaint 
to demonstrate their right to, and need for a preliminary 

injunction in this matter. They have, in addition, failed 
to demonstrate that any irreparable harm will be sustained 
by the plaintiffs if their Motion is denied. The plaintiffs 
have demonstrated their belief that they are unlikely to 
succeed on the merits in this Cause by their unwillingness 

to exhaust administrative remedies provided to them to 

redress alleged wrongs. In addition, the plaintiffs have 

S 

failed to comply with mandatory service and notice procedures 
Preliminary to moving this Court to grant a preliminary 
injunction. If the Court determines that it has jurisdiction 
to grant such'an injunction in this matter, the defendant 
respectfully requests that the Court deny the Plaintiffs! 
Motion for Preliminary tndunetion. 

RESPECTFULLY SUDBMI TTED, 

HODGES, DAVIS, GRUENBE RG, COMPTON & ATTORNEYS FOR DEF ll, METHODIST HOSPITAI OF GARY, INC 

wv Elias ft] EDWARD J. HYss] 
5525 Broadway 
Gary, Indiana 46410 
Ph. 901-2817 

SAYERS 

'y 

 



  

CERTIFICATE OF SERVICE 
    

I certify that a A of the above Motion vas maileQ to. 

Bruce E. Sayers, couns el for defendant Methodist Hospital; 

David Matthews, Secretary of Health, Education and Welfare; 

Attorney Goneral of the nia States of America and U.s. vd 

Attorney for the Northern pistrict of Indiana, along with a 

copy of the Court's Oider. which was previously sent on the 

4th day of January, 1977 by depositing the same in the 

a
 

glee 

TN 2 United States Mail with sufficient postage, certified mail, 

19th tay of January, 1977. 

return receipt ¥equested in the City of Gary, Indiana on the 

4 mp ge TL Be eel: = 
JULIAN B. ALLCH 1% N ; : ; Attorney for Plaintiffs es Axx 2009 Broadway 2 

Gary, Indiana 46407 : : 
Area Code (219) 886-3666 - 

  

Subscribed and Sworn to ‘before me this 19th fi of 

January, As77. 

S5
5 

    

  
A Hr ro 7 2 ER Public My Commission Expires: : 

i arch 11, 1978 

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EXHIBIT A 

  

 



    

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STATE OF INDIANA ) 

) SS: 
COUNTY OF ‘LAKE ) 

APP. IDAV IY 

Comes now K. G. Ambrozaitis, M.D., and being first duly sworn 

upon his oath, alleges and says: 

l. That he is a medical doctor specializing in the medical 

field of radiology and is duly licensed to practice in the State 

Of Indiana. 

2. That from and after January 1, 1960, he has been the 
  

Director of the Department of Radiology of Methodist Hospital of 
    

Gary, Inc. at all of its locations, and as such Director he has 

been in charge of the medical administration and medical supervisio 
AS 

of all x-ray facilities of said Hospital, subject only to the Board 

of Directors of said Hospital. 

3. That he served as Director of the Department of Radiology 

of the Methodist Hospital of Gary, Inc. as of July 27.,-1973, the 

date that Methodist Hospital of Gary, Inc. allegedly signed certain 

Civil Rights Assurances and he has continued to act in said capacit: 

4. That he has read the Complaint filed by the plaintiffs, 

Barbara Leek Wesson, et al., and that the allegations in Rhetorical   

Paragraph 8 that the defendant, Methodist Hospital, reduced x-ray 

therapy services at its Gary site and required all patients to trave 

to the Broadway site for those services is not true. 
  

5. Further affiant sayeth not. 

    K. G. Ambrozaitis, M.D. 
  

Z 

Subscribed and sworn to before me this Co day of ~\anr~v 

  
ig [RRS , Notary Public 

>. My Commission expires: 

  

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STATE OF INDIANA 

COUNTY OF LAKE 

Comes now Denis Ribordy, and being first duly sworn upon his 

oath, alleges and says: 

That he is the President of the Board of Directors of 

Methodist Hospital of Gary, Inc., which is an Indiana Not-for-Prof 

Corporation having a Board of Directors comprised of thirty-six (3 

citizens, which Board of Directors is the ultimate authority for 

the operation of the Hospital Corporation. 

That he has been a member of said Board of Directors 3 

ro
s 

continuously for a period of ten (10) years. 

That there exists within the Hospital an entity Eonpiised 

of all physicians who have been granted medical privileges within 

said Hospital, all of whom are either self-employed physicians or 

individual contractors; said entity is organized and styled as the 

“Medical Staff", for the purpose of making recommendations to the 

Board of Directors. The "Medical Staff" has no ultimate administrs 

tive authority and, therefore, the allegation as contained in 

Paragraph 6 of the Complaint filed by Barbara Leek Wesson, et al. , 

that the Medical Staff conspired and devised a plan to oppose any 

expansion of the Methodist Hospital at its Gary site, even if true, 

is irrelevant, immaterial and not binding upon said EL) of Direct 

That your affiant has read the allegations set forth in 

the Complaint filed by Barbara Leek Wesson, et al. vs. Methodist 

Hospital of Gary, Inc. and the allegations concerning reduction of 

oF 

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1 
: 33, X-ray therapy services at its Gary site and further concerning any ¥ 

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requirement that all patients travel to the Broadway site for those ~ 

"EXHIBIT C" 
  

 



  

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Ten 
; 
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( services is without foundation and utterly false = eo 

5. That over the last ten (10) years Methodist Hospital has 
not demonstrated any intention to deprive black residents of the 
City of Gary of adequate medical services. Methodist Hospital at 
both locations is and has been open to all Persons regardless of 
race, creed, color, sex, age Or national origin and without regard 
to ability to pay. Methodist Hospital has not acted in concert 

  with anyone or on its own to abandon its facility in the City of 
Gary. 

6. Further affiant sayeth not. 

   nd a’ - IE 

Id ‘4 
OW Ie, x - A 

nis Ribordy 
  

  

STATE OF INDIANA ) 

) SS: 
COUNTY OF LAKE ) 

Subscribed and sworn to before me this 

  

Nene, 1977. 

i : | nk oe lie 
Notary Public 

    

+4 2 ra i Ta EY 
: \ ee ing" “ ro ar a. : 

7," My Commission expires: 

i eo R7:7% 
  

  

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J 

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A ul 
5 \ iy 

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TITTIES



            

        
STATE OF INDIANA      ) 

Bj } SS: 
: 

COUNTY OF LAKE ) 

   

   

Comes now Larry Mang 

     
           

        
         

       

oath, alleges and says: 
: | 

l. That he is the Chief Financial Officer of the Methodist 

Hospltal of Gary, Inc. and as such is in charge of and has custo 

: of the fiscal information and financial and business records of 

said hospital. 

       

  

2. That the Methodist Hospital of Gary entered into 

ment with the Department of Health, Education and Welfare of the \ N , 

        
       
        
        
        

  

iY United States government dated September 5, 1873, Providing for ¢ Cc 

3% interest subsidy on a real estate mortgage in the sum of 

$14,315,207.00, and that as of January 24, 1977, five regula HN 

monthly payments have been made on said nortgage and 

    
        

made a part hereof and marked "Affid: 

  

-he mortgage amortization the mortgag Ortization      

        

d ‘interest subsidy for each and every month hereaft 

- said balance is paid in full; that the aggregate 3% interest subs 

over the next 24 months commencing February 1, 1977, is in the su: 

   of $337,355.05.       
   

        

     
    
     

         

         

    

3. That the Federal government and the defend: 

3 Hospital, pursuant to said interest subsidy agreement, have estab : 

certain machinery and procedures for the payment of this interest 

” subsidy and the cost of changing this procedure, as well as the : 

Cost of altering the financial planning, budgeting, rate structur: $ 

v and other matters having substantial impact, including possible <= 

rate submission applications upon the granting of ‘a Preliminary 

. re injunction, and also the cost of changing said procedur 0 y
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1s estimated to cost Methodist llos i 
   

    

"Dollars 

  

($20,000.00). 

    4.. That the defendant, Methodist Hospital, has obtained 

approval of the Health Services Adqc 

          
      

              

        

  

   
8 Agency for Norlhern Indiana {or 

three building projects being a health services building in Gary, 

a health services building in Merrillville and a laundry in 

Merrillville. This approval was granted September 28, 18768. "In 

addition, defendant, Methodist Hospital, has obtained a loan guaran - 

                   

      
       

        
      
   

* agreement for said projects under Project Numbers 212 and 213 both 

of which are dated September 28, 1976. Copies of said agreements 

are attached hereto, made a part hereof and marked "Affidavit 

\ » Exhibits B and Cv respectively. Said loan guarantee agreement 

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provides for a loan guarantee and 3% interest subsidy provided 
AJ 

the project is placed under contract within 12 months from the date 
J E 

OF execution of these agreements by the Secretary (of HEW) unless 

    approved by the Secretary but in no case to exceed 
     

       

    

18 months, Said 

       

       

        

lpan guarantee for Proje 

$2,511,604.00 and for Project 213:i5:°93,5 No
 

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Of the interest subsidy thereon is in the 

$ a AA 4 OT - 
5. That in addition, the defendant, Methodist llospital 7 

obtained approval for a grant of $491,573.00 in Nill-Burton Funds 

            

         

         

      
   

for the construction of said buildings, which it may lose in the 

event of a preliminary injunction. 

6. That the cost of said construction, if delayed, will > 

increasco. 

Further affiant saveth not. 

   
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N - ‘is ; ‘Subscribed and sworn to before nda Sb] ’ ‘ % z" > & 
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FACILITY GARY METHODIST HOSPITAL 

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vith interest  oubsidy under Title vi of the Public ealth | Service BoE 
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or - Ley . . Piet, fo halts ree ge “a re tnst 

KE 0. 5.C. 391 et seq. ’ hereina fror reierred to as the ieeny which’ 

abpi sation has been approved by the Secretary: 

. ~The Secretary, in accordance with the provisions of this Agrecmen: 
hd - 

hereby offers to guarantee payment of a loan to be made to the Applica: 

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to meet page of the eligible cost of construction of the project «4 

[SN . a* - - . ; RP 4 eet ye . » 5d ee No - ’ Fad Ha EIA . SN hos at ~~ “ite 

deli luen: ei the Btieat ton dnd! to pay ans hr erastinbe lis! Shettm 

A Upon written acceptance by the Applicant in the space provide 

below, and subject to the terms and conditions set forth in paregraph : 

he » hereof, the Sccretery agrees as follows: 

Ala nama man oe 
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/s L- loan Guarantee Agreement Ey ‘ [1 ® ein, 
Ie i : : ony : uh ; : . : [+ wood, 8. . To guarantee payment by the Applicant (in 8ccordance wi 

the repayment schedule de scribed: in pdvanbuuh 2¢ hereof) of Intorsne 
- - . - = J &nd principal on a Youn, to be made to the Applicant by a non-redere 

  

4 "i 4 lender, in an amount equal to the lesser of (i) & 2,511,604.00 4 : 
: 

; or (if) an oszcunt vhich, when added to any other financial assistenc 
yi ] (ercluding frrerast cubelds payments) routed vaths eho. roti ter the -f " 

. ii : 

. 4 construction project described in the Application, equals 0 per cen 

5) FA of the eligidle cost of censtruction of such project cs deternined b: 

3 the Secretary in geetrganss with the fict and the feplesent Lag pregra: 

’. regula tions (42 CFR Part 53, hereinafter referred to ac the "Regulat: 

{ "be To pay oa behz2lf of the Applicant to the holder of the ? x 2 : 

: loan guaranteed by the Guarzatee Endorsenont appended to this Agrees. 1 
ha ra Ahereipafter Yeicrred .to ac the Guaranteed, Loz n") juterest payments 

i! % amount o betrintans 2 reduce bd 3 per centun Ji neva the. net Sots IR SE HR a isn Pid Wy 
d interest rate 2pproved by the Soeretaty, tasn execution by the Secrc Bien A 

ies of such Guarantce Endorsement, the holder of such loen shail hove a c id 
8 tractual wight to reocedve from the Scerctory the interest Cuboidy pov 

§ 2 mente required by the preceding Sohboabe Payments of interest subei 135 
: : 

i ven : puTguant ‘to. this Sharan will be Fale. by: the, Seorsrey in LEcoRd 

“vith” the terms of ne ; Soy ratte a to the hol, der "of Sih Yoon or “to 

tructee or agent designated in writing to the Scerctaory by such holde: 

until puch timz as the Secretary fo notiffcd in uriting by the holder 
\ . 

that ouch loan has been transferred and has acknouledged receipt of C
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Loon Guarantee Agreement ; FoR rE | . 

such notice in writing. Pursuant to such written notification of 

trensfer, the Secretary will make such interest subsidy payments 

Qivo~el.. ~~ TS) Np. “ove hat Anew TIER JIE, ~~ ha TAannms $ Vvnassd AAA Tove Ate Ye ay LR -~ bh Ne oo WY BAN Ava N*M Gtr ie ws wwf “a ~ fr AN sb ee oon eA neBs rica Cone wy  ¥ 

  

ever, that it shall be the responsibility of the holder to remit any 

payments of interest subsidy to the new holder which the Secretary 
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way have made to the holder after such transfer znd prior to receipt 

of such written notice, and the Secretary shall not be liable to any 

party for amounts remitted to the holder prior to receipt of such 

written notice and acknowledgement 
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in writing by the Secretary of 

receipt of such notice. i, He Ser on 

2. ‘The cormitments of the Secretary described in paragraph 1 

above shall be subject to the following terms 2nd conditions: 

: a. . The Guaranteed Loan shall gonstitute the Jnitial Jo we .e d. agin . . a -* rr, . 
. . we . - . 2 . 

. . ® - , . * - 

-permanent financing of she project. hot 3 hat 
ot ee o* © o . 23 tet , vo .- . e «ce * "e Fat bh EN SAL . oq 

bh,” The project with respect to which the loan guarantee is 

made shall be placed under contract within 12 months from the date of 

wr uticsn ~& his Avon nas Hee +A Cocrptn~— v ese ~~ - lonrer | 3 - Ono curasy A [9 AO 0p a [1 LW 3 J bi [Wi Si wax), Nadi bed (8 ab Aw a A A bade. a a> 
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approved by the Secretary, but in no case to exceed 18 months. 

3 . C.. " av? oe i 
wie teity BLN 2 MY Ty " ey . . «= +N = - 0 - . ER .. : A . . ®e 2 heel . 

here the, [Guarantee Egdorgement Priozr.to Lomplopion. of 
- ate - . . 

“Construction appended” to’ this” PY ama ony Te eroonted by 7H Secretary, 

the proceeds of the loan £0 .be guaranteed shall be disbursed to the 

Applicant by the lender in accordance with the terms of a building 

Loan Agrecmont to be centered into by the Applies nt, the lender, and 
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Loan Guarentee Agreement ei E : $i IA 

the Secretary prior to or at the time of such Endorsement, and which 

shall be in form and substance epproved by tiie Bocrdinny, Upon any 

disbursement of guch proceeds to the Applicant by the tender dn com~ 

pliance with the PCE of such Settling Tod CPRRER LM Led of: 

the principal amount of such disburscment, togethty with interest 
, TN aia . 

thercon, shall be deemed unconditionally guaranteed by the Secretary 

in accordconce with this Agreement. (This Svaibe hall not apply 

vhere the "Guarantee Endorsement Following Construction” appended 

ss hereto is executed by the Secretary.) | 

d. Unecre the "Guarantee Erdorgewent Following Construction 

cppended to thie Agrecment Ir executed by the Secretary, the project 

‘shall be constructed to completion in accordance with the appliceble. 

Tir provicians of ‘the Act 2nd the Regulations -and vith: the’ plane end. 

+... .8pacifications &nd the terms, conditions, and assurences set forth dn 

¥ the Application, which Application is attached hereto as Appendix A 

end is hereby incorporated by reference &nd made a paxt of this 

Agreement us though fully set forth herein. (Inis paregreph shall 

not apply Jif the "Guarantee Endorsement Prior to Completion of 

Constiuction" "appended hereto in executed by the Séeretary,) I. 
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e. The principal acount of the Guarantced Loan, together 

vith intercct thereon at a rate which chall not exceed the PIMA aver- 

epee avction yield rate for 4-wonth commitments at time of endorsement, 

-% « =r ghall be xepeyeble in’ accordence with a repayment schedule vhich {so 

 



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the Applicant ohall be pormisted to prepay up te 15 

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Loan Guarantee Agreement - : / 5 

_agreced upon by the Applicant and the Lender prior to or at the tice 
i . 

of closing, and which {s approved by the Secrctary: Provided, that 

J ICT contin of tha te 

original principal smouat of the lozn in any calendar year without 

additional charge. The Applicent and the Lender may further agree 

that the Applicant wlll be permitted to prepay in excess of 15 per 

centumn of the original principal amount of the lozn in any calendar 

year vithout additionel charge, but ro such payment in excess of 15 

per centun shall be made without the prior written epproval of the 
- 

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Sccretary. 

£. The Guarcnteed Loan shall be evidenced by a credit 

fnstrument and securcd by a cecurity instrument in a form found 

 peseptante by. the Serutery for use in. the locality in which the 
vii. . . ae se - . Se, ain 

profess fo to be constructed, covering such sccurity as the 
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Shokaruty finds RAT SLE pu insure repayiént. Thore 

shall be presented to the Sceretary, at the time of closing, in 

accordance with the Regulationa. a final approving opinion of the 

Applicant's legal counsel stating that the credit and security 

i executed by the Applicant are duly authorized and 
‘ HATKARS vied oe 32 of nih oad ’ 4 TT AL ne cd Ls, Mi Na - Wal v.J Spl I RE TT a et. i > : ’ {VELA ov ye wii ot, : “wry i lg Mi JET 3 s dio SLB 

delivered, AR that the indebtedness of the Applicant: dg’ varia aes 

and binding acd payable in accordance with the terms of thig 

Agrecoent, 

g. Closing of the Guaranteed Joan 3hall be accooplished 

"at guch tine and place ac nay be agreed upon by the parties to such 
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of the Applicant, i full emoiiat of ell overdue paynecnte of principal 

Logn Guarantee Agreement 

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3. a. If the Applicant shall fail to make any payment of the 

Guaranteed Loan when due in accordance with the repayment schedule 

roan 2a hereof, PA onan Anfan + io nant 
oe Sr Yo be ew 

90 a after the Secretary receives notifficetion from the holder of 

the loan of such feilure of payzent, the holder cf the loan ghall have 

tho right to make démand upon the Sccretary for 

this Agreement, Upon such demand by the Holder of the loan the 

payment purguant to 

Secretary shall, aot his option, cither (A) purchase the loan through 

the payment to the holder of the loan the full unpaid principal swount 

of such loan together with cccrued intereet on guch unpaid priucipal 

«wrount at the date of such purchase znd any reasonable crpenses 

incurred by the bolder of the loan In Bepougtinn to secure payment 

- from the Arplisanty, or (8) Puy 10 tho holder: of the Loan, 
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and’ ceerued crise tones ‘with sich reaconcble” chilntes for late: 

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payment os &re msde in accordance vith the terma of the credit 

.on- beha 18 

et 

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continue to make paycents on the loan vhen due (in accorcance with the 

;Tepayment cche adule deperibed. in paragra aph 2c. hereos ) until. Auch, tice. 
. Phd Lod » - CEN - 0% ne >, 

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CE the pe ale recuzes the ‘making ‘of such paypents or the Secretary” 

. - . HE A Sell ii “as - 3 Tip . foal 2 

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elects to purchase the loan ap provided in clause (A) hereof, 

“eras 2. 5 
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b. The Unitcé Statea chall be entitled to recover from the 
Cd 

Applicant the coount of 

denced by the Guarantee 

any paynrent made pursuant to the guarantee evi~ 

Endoracment eppended to thio pe Terzient, unlena 

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b or———y We / a WEE ah . A —————————————— gr i oe 0 mt A 8S Re fr 8% Pd 
. 

: : A " ( . . 

Loan Cuarantce Agrecoent : : i 

roking any cuch payaernt, the Secretary shall be cubrogated to 8ll of 

the rightc of the recipient of the peyments with respect to which the 

be’ Upon written acceptance by the Applicant.in the space provide: 

below, the comaitizeat evidenced by this Lgrcement shall, cudbject to th 
- 

provicioas of perograph 2 hercof, be fncontestable (1) as to the 

Applicant cxncent for freud or misveprecentation on the pert of the PP Pa P P 

épplyesnts cond (Li) 25 to any percon vho contracts to mcke a loan to 

thin Applicant in kelionse, upon such goizmitoent, except for fraud or 

nisrepreseatztion on the part of such other percon. 

5. Upon exccution of the Guarantee Endorsement eppeaded hereto, 

the Scerctary's guarantee as set forth in this Agrecmant shall be 

jicontestable) as to any holder’ of the Guagooroey Loan, opcaps. for frecu 
by 

   
  

  

  

. - : sr Ld g ® er SE Te nt if 3 fd ore - d Pa - cgi. hl bs = ee . =i rth Fy - e Pol < - v . 

ox misrepresente tion on the’ part of such holder. : 

e. 0% +" gf” Ces J 4 3 .. oe . "a. br - “ > * .e" *. - «oe 

pallid tha ie ow LEW» Cite Sootetary of Ilecalth, Education, 

: ! . end VWelfere: 
: / 

By: : 
: : - / Peter Stricker, Financial Analy 

: Title: Health Facilities Branch, PHS 

Jo, TN Ty CA, Date: September 23,.1976.. ov ose en 
CIGAR RAN CRI va C6 BE FOR - So SRS 

. Line oy a nine Py a ar TE ple  - s malin iN Lao ra NT a : 

‘hecéptonce by Applicant: ag Fh i to TE 

  

The Methodist Hospital of Gary, Inc 

(late of i 

By: 5. 75. hg ZES 

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STATE INDIANA - 

2 Ey Ee te Sm le i 
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3 £3 ¢ i 

e . : . i ve Ji. i : . . “- - In 

> ot 2 Fi . . hak . 1/2/ 

igen Exhibit 

i CER LL TRE El a RR #e 

fie PROJECT HO._ * 213 Th felled 
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FACILITY Broadway Methodist Hospital - 

IOAN GUARANTEE AGREEMENT 

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Broadasy Methodist Hospital 
WHEREAS, The Methodist Hospital of Gary, Inc. 
      

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i , ) Usiml name of private nonprofit agency) 

i thos atnatier referred to as the “Applicant"') is a private nonprofit. 

¢} -- agency ¢hich hes filed vith the Secretary of Health, Education, and 

t J Welfare (hereinafter referred to as the "Secretary") application for: 

I : Project: No, Indiana - 213 y dated March 25, 1976 J 

i Corotreteos Xefervod to as the vas for a loan gustantee 

: + ete Saterest subsidy ato Te VI of the Pibite Sate Service. Pe 

HE foil a [(& rol C. “Zo1 et seq. tt SERA Shl ew, FI 

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pip - appleatiog has been approved by the Secretary: 

. , The Secretary, in accordance with the provisions of this Agreeme: 
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hezeyy offers .to guarantee payment of a loan to be made to the Applic: 

Yea en KO Jeet pare of the eHpgite cost of construction of the projocy 
. -t - a - + ., - - . Pau A Fig - bi - i AR So Piatt > rt A a 0 By A LRP. re 

Ni anor? ‘ideséiived Iu the: Soha .and.to" pay. an- Thterest: Absa! thereat 

. 1s Upon written acceptance by the Applicant fn the space provid: 

below, and subject to the terms and conditions set forth in paragraph 

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trustee or agent designated in writing to the Secretary by such holde: 

Pp ’ ; : gr 

oats ; ERLE J. 
: Plies Loan Guarantee Agreement KC : ? 

dk : \ : . - . . 

. I. az Aas, ~ 8. .To guarantce peyment by the Applicant (In accordance’ wi: 

| i the repayment schedule described in paragraph Ze bereof) of interest 
i! : 3 . ig x x . x &nd principal on a loan, to be made to the Applicant by 2 non~Yedera: “3 ; 

ug i - 

Sk "lender, {n an cmount equal to the lesser of (1) $3,522,8395.00 
4 : 

. 

3 or (ii) an awount vhick, when added to any other financial assistence 
LY ¥ ei Th 3 (excluding interest subsidy paynent sg) Srovided u-der the Act for the 

Es y 

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4 construction project described in the Application, equals 20 per cent 

os of the eligible cost of construction of such project es determined by 
F : | 

+13 the Secretary in accordance with the Act and the irpleuenting pregrac 23; ' a . R! Kd 

3 regulations (42 CrR Part 53, hereinafter referred to ac the "Pegulatd 

{+ b. "fo pay oa beh21lf of the Applicent to the holder of the jars \ 

: loan guarantced by the Guarzatee Endorsement appended to this A Jar EE] - 
. . " 33 : ; 

5 3 Se (hereinafter referred to as Lhe Guaranteed Loz") jotorast payments, YN an” tO VR In Err Si Ga Tey. B® Rita 00 : . 
: fis ri counts sufficient to reduce by 3 per centun per anrma the net effect 
cL dl pa ry CE a ae rl ia. Ld NIA H Seve hi Ss 5 . Te, rie a2 . ) 

3 interest rate cpproved by the Secretary. iio cxecution 3 4 Secre 
et Es 

: i hy of such Guarantee Endoxrsexent, the liolder of such loen shail have a c 

A ! FIER Sy ed nthe +A TN PR ere Shin Carnvoatvwsy Yom Prnbmvnnt Aceh nd dar ennn- Ad 1 Ve See We Va A Se deb 388 0 - Ll SR AT SA Vara te 08 Ne SF Nr Nt Be Ne be Ne te P A Al a, eV bth chant of fond | t “2 

3 mente required by the preceding sentence. Payrrcnts of Intcrest subsi: 
i : 
is Gmina pups nt “to. this Fuhpay egreph will be rade. by. +h. J in zccord 
I Sie A PIR IC BE sf Sr init 
) vith’ the terns of OH, {0 Jiteiety to She betdor of fodh Teo n or to 

| 

I until such timz as the Secretary ic notificd in vriting by the holder 

| thet ouch loan has been transferred and has acknouledged receipt of 

  
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of 
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he ever, that it shall be the responsibility of the holder to remit any 

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payments of interest subsidy to the new holder which the Sccretary 

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may have made to the holder after such transfer gud prior to receipt 
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. E . of such written notice, and the Secretary shall not be liable to any 

i : . ~. party for amounts reaitted to the holder prior to receipt of such 

. i . written notice end acknowledgesent in writing by the Secretary of 

3 ’ "receipt of such notice. | : 

{3 2. ‘The commitments of the Secretary described in paregraph 1 

; i Alone ghall be subject to the folloving terms 2nd conditions: |   

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: a. . The Guaranteed Loan shall constitute the Anjtial, 

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b. The project with respect to which the Joan guarantee 1s 

made shall be placed Sidi contract within 12 months Sebi the date o! 

approved by the Secretary, but in no case to exceed 18 months. 

  re Et le Cu here the. a ge. Endorsement Prior.to Sooplaria of 
- . - A . ce . . 
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Applicant by the lender in accordance with the terns of a building 

Loan Agreement to be. entered ite by fhe Applicant, the lender, and 
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  fn fe va 3 . loan Guarzotee Agreement on. : > 

the Secretary prior to or at the time of such Endorsement, and whic 

  

3 : shall be in form and substance approved by the Secretary. Upon any 

; a Mitr disbursement of such Jrocseds to the Arplicent by the lernder in coo 

pliance vith the terms of such Building Loan Agreement,’ repeyment c 

K: the principal amount of such disbursement, together with interest 
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thercon, shall be deemed unconditionally puaranteed by the Secretar 

in accordance with thig Agreement, (This paragreph shall not apply 

vhere the “Guarantee Endorgscuent Following Construction" appended 

/ hereto is executed by the Secretary.) 

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d. Vlhere the “Guarantee Ecdorsement Following Constructio: 

cppended to this Agreement fz executed by the Secretary, the nroject 

‘shall be constructed to completion in accordance with the appliceblc R
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Vie wiiptuely provioions of the Act and. the’ ‘Regulations -and vigh the Fpianc end 

Bp 2 wi al ae rotcilictions aod the gore, conditions, znd assurences set forth, 3 

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[ the #ppiication, vhich Application is attached hereto 2s Appendix A 

end is hereby ‘incorporated by refercnce and mede a part of this 

Agreement ‘as though fuily sct forth herein. (This paragrepn shall 

not apply 4f the "Guarantee Endorsement Prior to Completion of 

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- & Co the principal azount of the Quzrnitent Loan, together 

| vith interest thereon at a rate which ghall not excced the FIMA aver 

cge auction yield rate for 4-conth comnitnents at time of cndorseacn 

wedi iw tel alia lY bp xepeyeble in accovrdence vith a repayment scnedule vhich is   
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2 Xelivored rand that the SGloteadhoss oe the Applicont’ dg valid 

  
Loan Cuarantce Agrccuecnt - | Vs K 

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agreed upon by the Applicant and the Lender prior to or at the tice 

i 

of closing, and vhich 1s approved by the Secretary: Provided, that 

the Applicant shall be permitted to prepay vp to 1S per contum of the 

original principal cmouant of the lozn in any calcndar year without 

edditional charge. The Applicent and the Lender nay further agree 
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that the Applicant ulll be permitted to prepay in excess of 15 per 

centum of the original principal amount of the loan in any calendar 

yeax without additional charge, but no such payment in excess of 15 

per centum shall be made without the prior written spproval of .the 

- 

Secretary. ay | : - 

£. The Guaranteed Loan shall be evidenced by a credit 

fnstruzent and gecurcd by a security instrument in a form found 

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- .” - 0, * ute 

project ™ to ve constructed, covering such security as the 
- 

Sechetaly finds reasénably’ euttloting: £6 insere’ rcpaysent There 

shall be presented to the Secretary, at the time of closing, in 

accordance with the Regulations. a final approving opinion of the 
- 

Applicant's legal counsel stating that the credit and security 

instruments executed by the fopit cant are duly authorized and 
“et » i TE e + on J . re lL . . “bg . ! - 2 wat a , Th oe ’ n . v . ek . > * or. ~ Ys gi os, ™ L o> ki * SNE onl on gh Ie > 2 Pa ’k Et ene, *.. - a, es Eg Tatar WN, Pe vt 

and binding and payable in accordance vith the terns of this 

Agrecrent, 

g. Closing of the Guarantced Loan 3hall be accomplished 

"at cuch time and place ac nay be agreed upon by the parties to such 

Joan and the Sccretary. 

 



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. Guaranteed Loan when due in accordance with the repayment schedule 

oe v0 doys after the Secretary receives notificetion fron the holder of 
i | the lean of such fzilure of payezent, the holder of the loan ghall L- : 4 
i : | the right to make demand upon the Secretary for payment pursvant to 

yl P i this Agreement. Upon such demand by the holder of the loen the 

Secretary shall, at his option, cither A) purckase the loca throush 

5 the payment to the holder of the loz the full wnpaid principal npour 

i Nig of cuch loan together vith cccrued jutercst on such urpaid priveipal 

{- . wmount at the date of such purchase znd &ny reasonable cespenses 

2ncurred by the holder of the loan in ettempting to gocrre payment   
Hots sect. .~ +. from: Bie Aopiicant or. (8) pay fo the holder. of the loan, on- beha =1£- “ 1 LJ 

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=F yr. of the #zplicant, the full emoiint of all overdue paycents of princips RS - 

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“at's a3 . va : el . . ee Tew a Ce. 2 

§ iy 7 and’ hceried inherere, sonetiiss ‘with sfch reasonchle Clirges for late 

payment ds are msde in atchidnnce vith the terrs of the credit instru 

TAS §- > ceauricw dente, tea ry B= vidonat Sm AY vA ~uri-~ moons p Po on od = are 
La Rk TEN ox [OR SE GRP -J ABBAS he te Aree aa ~ te OO Ve veLls aap waa Arent gn Fay pal . 

continue to make paycentz on the loan when due (in accordance with tl 

-" . 

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Sp, 3 » eo rv - — Po 

SN REE fr] TN - 0 a + v] a - SY - a IK Rego —n pn . 

= wind ny aed sXepaypens sehedule describe ed: in paregre ph Ze: hereof } until. such Sloe 

: IE ns he ni t recuzes the mak ing” ‘of such “Pagoents or the Sccretasy 

clects to purchase the vii as provided i ‘un clause (A) hereof, 

b. The United States shall be eatitled to recover from the 

Applicant the coount of any payment rade pur, cuant to the guarantee ev 

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making any cuch payment, the Secretary shall be cubrogated to all o! 

the rights of the recipient of the payments vith respect to which 

guiraniee uas made, . - : 

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below, the cemituent evidenced by this Agreement ohall, cubject to 

provisions of paragraph 2 hercof, be incontestable (i) as to the 

Applicant except for fraud or nisrepresentation oa the part of the 

Lpplicent, cod (11) es to aay person vio cont uses to make ’ loaw t« 

_ the Applicant in reliance upon such cozmitment, except for fraud or 

Cy nisrepresentetion on the part of such other person: 

2. Upon execution of the Guerantee Endorscmiont eppended hereto 

3 the Sceretary's guarantee as set forth in this Agrecmont shall be 

: fvcontestable, as to my holder of the Guarentced Loan, ohcopt fox, i 
No agli SY Tats 20. oT Rl ge i 7s’ ie Es AP i Br x3 PI a 7 

Tames TRA Wg on the part of such holder. x % hy 

AER Rl J PE TY i Bene EME . : hn ver sare eg, A : vs. 

he Scerctary of Fy Tiisite 

Ag os : So ae ha and Welfare: 

di mer ne. 
. : : Az I Financial Ana 

: Title Health Factiitaes Branch, PHS 

  

  

  

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o Sw ba. a Na win PU ig onl. . te id 3 : 3 Les “aie yi LRP RAIA 21 DAREN ‘- “ ELIT IN Be PEAR ’ Da ‘ Le veptc aper 26, 3.2 76 Ee JA 

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LS ae St lu ti bt ee Nn LR ee eel CON FETE SLE edt fg 

PN . a a a . Tm. eo So, . .« ¥ "e%T cpecéptance by Applicant: 

The Methodist Hospital of Gary, Inc. 

(Rane of Applicent) 

nd lar amd TAT AF. an A . . iia 
R.B. Glesnc 7 

Title: Administrator 
Br ee se er Sa A 3 al np TY 

  

  

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a i A A Oh , iL Ui i ia -- B I-s a ey A TN ET AR LN 

  

ATTACHHENT f2-A_ ar — «ee 3 

  

   oy 
Co INDIANAPOLIS 

TIA 7 ANI idholed 
STATE BOARD GF HEALTH Ph aid Address Reply to: 

Indiana State Board of Health 

1330 West Michigan Street 

Indianapolis, IN 46206 

March 13 «1075 

bY 
Everett A, Jolmson, Ph.D. 
Administrator 
The Methodist Hospital of Gary, Inc, 
600 Grant Street 

Gary, Indiana 46402 

Dear Doctor Johnson: 

This 1s to advise you that the Indiana State Beard of Health 
has approved Federal assistance in the form of Hill-Burton funds for 
your proposed construction project. 

; Unfortunately, there were insufficient funds to provide full 
one-third participation. However, pending determination of actual 
qualifying costsy®we are reserving for you $215,396.00 in the general 
category. This amount represents funds available when your priority 
was reached, 

. This is to further advise you that you have been favorably 
considered for Hill-Burton loan guarantee funds in the amount of your 
presently estimated eligibility, $2,511,604.00, % 

We would like to know, as soon as possible, whether ybu can 
develop an eligible project with total funds presently availztble, 

Inasmuch ag there are deadlines by which Federzl monies must 
be represented by construction underway, this approval is a tentative 
one, contingent upon reasonable progress in bringing this project to 
the peint of construction, : 

We will be glad to assist you in the completion of all 
necessary applications and attachments, 

- Sincerely, - 
. 

A 

pd . p.S 
J py to " Sar 

’ 2 rd £ ts) 4] i pd 7 2 

a SL IXTAT Yi ITs TI. 2AYNT M.D. 
ri . YIYY. HEAL TIT GOMMYGSIONER: 

STAL: BOARD OF HEALTH 

   



  

PES “ . at dle on, NGA 0 D4 sm Lr “rene . Ao SN I AEX LA Tad Baw 

ATTACHMENT #2   

re Ty Bn TR 
oh . \ 

ot | STR = | NDIANA AE ON v o W fa. Tal - 

a RITE rs anata f el 

  

INDIANAPOLIS 

  

STATE Bast OF HEALTH iT : Address Reply tog For 

bodaona State Board of ¥eulth ok 

1530 West Michizan Sireet ~ 

Indianapolis, IN 46204 

March 13,:1975 

Feerett A, Johnson, Ph.D, ‘ 

Administrator 

The Mcthodist llospital of Gary, Inc, on 
600 Grant Street 

Gary, Indiana 46402 

Dear Doctor Johnson: 

Broadway Methodist Hospital 
Merrillville, Indiana   

This 1s to advise you ti the Indiana State Board of Health 

has approved Federal assistance in the form of Hill-Burton funds for 

your proposcd construction project. 
TR = 

Unfortunately, there are insufficient funds to provide full 
one-third participation. However, pending determination of actual 
qualifying costs, we are reserving for you $276,177.00 in the outpatient 

L) category,’ This amount represents funds available when your priority 

rey 3 This is to further advise you that you have been favorably 
considered for Hill-Burton loan guarantee funds in the amount ofsyour 

presently estimated eligibility, §2,603,823,00, 

We would like to know, as ‘soon as possible, whether you can 

develop an eligible project with total funds presently available. 

Inasmuch as there are deadlines by which Federal monies wust 
be yepresented by construction underway, this approval is a tentative 
one, contingent upon reasonable preofress in bringing this project to 

5 A . Ail Th AUTEN lend 1 theipoint of conglruction, 

We will” be glad to assist you in the completion of all 
neceasary applications. and attachmenty, 

Sincerely, 

Er Lo 1 . Ber TE A Zs ; | 

 



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Yo Reply to: ? (’] 

a THODIST - HOSPITAL OF GARY 

1p Besa0m0 ren A hs Re SEG Yen LT me rag ssa, nt ni] 

el Ei rab 28. 197 oa sei pit 4 

2 EXCERPT’ OF. THE MEETING OF THE’ BOARD OF DIRECTORS. oF THe METHODIST RE a 
1 HOSPI TAL OF. GARY, INC. AND BROADWAY METHODIST HOSP ITAL. ake wy) iy Ea) 

al Rk aaa Te Arjan: Leto was rant, aed and the RIE 

” wh 
iY . . TER 2 : 

5% ey Wola Te SI TL Th maity Yoh SRE gemd L ES i VEE vp ho on i arin el “ ig Ved . J a ie : aR 4 he x : fais P [3 r, : ' . . Li SER “hy ia ae ; i I , AER EE : Ps 3 wv. “ay isp oo Seshid eis ny i vd 5 ve 3 . H AW 2 -t x SER Fl 2 i. ’ ype I 

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of Cant A Ske ERE ATTACHMENT #3-A SMe Ee 

~i7/ THE METHODIST HoSPIT, AL OF GARY, INC. 
Tues 0 BROADWAY METHODIST HOSPITAL ERR 

Lh - » : } wh " . ; 3 ; 2 : 1 te 3 Phy sd jn rad 5 

v lin Ror: 0! 1) Tk 
Wh mea wt int Doel it BROADWAY METHODIST HOSPITAL BO GRANT SURFER 2.00 pune yl erg i HT ha a ea tite? ABEL 830 PROADWAY .. * hen tS KiDIARA 46402 at of ee Sl TE Ry i WINE MERRILLVILLE, | INDIANA 46610. pan: 

  

  

formation, Submitted, in She papel icarion was approved. 
Sige \ Ly 

  

  

  

    

hpi Ta mot ion a7 i Feeals W. coin and ad by 
SET Rev.:.Doy le Pavy the following fess on was adonted | 

Spd ds She RESoL UTION 

i hE HT RESOLVED hats Py WA Gti appr 
[LE gation ‘for. the. "Health Services Building:- Gary, x 

Car rn He alth’ Services: Building - Broadway rand. ‘Laundry, sis, 
et 2 hereby sapproved, - and” ‘that the! Adnintstrator ‘bey and. Vl 
nih is hereby authorized to execute all. neces sary: Soci 
ny “ments on bef. of the Methodist “hospi al of, Gary, ilnc 

SEL h Ten Srosnny Methods tL Hospi tal Board of ‘Directors ii wid 

      

  

FI “Mii Tam B: Todi ‘Selretary. of ihe Board" of. Piroetor, of ; 
‘The: i Hospital of Gary, Inc, and Broadway. Methodis Li Sr ay 
ital, do: hereby certify: that the. above .and foregoing isa. true” eh 
and. correct. ‘copy of the e excerpts: of ‘a. meeting of the’ Board, of gt 

“Directors Sheld) on, the, 23rd: (day, of Februnty, LE 

  

    

    

  

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teu 2 > : ) Al op “i doi Bo EY 1 Jd of py i rec iors he She : 

hip TY oh Tad Hh Methodist. Hospital of Bays rt aka 
3 FURR ee LA aid Broadway | Methodist Hospital | LE



  

  

oH 3 B 

al — ATTACHIUNT 

SPECIAL METTING OF THF D578 OF DIRCATORS 
of ‘tha 

METHODIST HOSPITAL Or 2: GARY J INC. 

Decermber 8,712 15% 

The special meeting of 
was held Monday, December 8 
the Broadway Method!st 

ati] 

Mr. 

y: 1375 
Hospltal, 

Present were: 

Hatai Ie 

Wil 

4 HE 

Mr. 

nshbaugh 
Ross Bain 

Virgil Blork 
William Calvert 

prs Fa 

Mr. 

Dr. 
Mr. 

Rev ra i Pavy 

  

the Board of Dir 

D. 

1am got) 
Mir. Randall Morgan 

ectors 

: 30 

of Methodist Hospital 
a.m. In the Cafeleria of 

Ribordy, Fresident, presiding, 

B. Glesne 
ry Manoccld 

alyn Sackman 

guest 

Hi tig 

Mr oiLar 

Miss Ev 

(Libya nay 

King 

l.ong 

ba rbe ’ 
Rev, R.:J, Chrispell Mr. Mamon Powers 
Hrs SB Coins Mr..Denls E. Ribordy . 
Mr. leslie. {Combs Pr. F. C. Richardson 
Mr. Herschel E. Davis Mri) Jd Robares 
Mr. William B. Davis Mr. Everett Scales 
Mr. Fred Dayhuff Pr..H. Theo Tatum 
Mrs. Edith Dorman fr. Cecil Yonngel 
Hrs. Cleo Duncan Mr, Marvin Weiss 
Mr. F. Ritchey Eibel Mr. Dean White 
Mr. Glenn Hannah Mr, RB. . Yarrington 
Mr. Traver Hav Li, jade Br. Riri G1ilg 
Mr. Frank Jannasch Droal. 0. -Mivieh 
Mrs. Louise Kichukoff 

Excused: 
Absent : 

Mr. W. W. Gasser None : Mr. Robert G. Jones 
’ Mr, Glen Slick 

DriocJ. HW. Hadey 
} 

INVRLAY LON i Dr. cYirgl) Blork: 

APPROVAL OF MINUTES 

hud tit oF Virectors meeting - November 24 1975 - approve, 

Combined meeting of apse Comittee, Planning Commlttee and Interlm Policy Committe: f = 1671 : 

MOTION #1 . # 

Motion to approve the recommendation of 
the three committees above Lo. authorize 
implementation of the threa projects pro- 
posed whichalnslode iv hh Laundry at Sai ny 
Health: Servicii fing ding ot Broad art 
Fhe ariiogits I Samar) 1d ES] Gary. he songd 4, 
discyised et] ! vii rs and 24 3 eT fey 

 



Ne on Dl AR GAL Ol ot I. 5 EAM) FT es AN eT Ns 

  

  

ATTACHMENT #5-A 
‘w 

3240 wi ALL 

REVISION 
View JF 
Pages 12, Original Application 

Project Summary 
Estimated Space Estimated 
— Required i> Cost     

Project Component 
” ads AA 

A. Gary Health Service Bldg. 
Ambulatory Care 6,930 
Support : nea ly 128 

  

Family Practice 6,565 
Mechanical 5,286 
Public 8,811 

a TOTAL 31,720 $3,281,370 

B. Broadway Health Service Bldg. 
Ambulatory Care 13,000 
Admitting {est,) £,000 
Public (est.) 6,000 
Health Fducation (est.) 2,000 
Hospital-based Physicians 6,000 
Mechanical 7,000 TOTAL : 39,000 3,599, 800 

  

C. Laundry 15, hhh ¥ 262,200 

Ft pe Sp ge she Jif 

Gary Methodist Broadway Methodist 
Project Cost $3,231,370 $4,862,000 

Financed By 

Giant 
215 306: 276,177 Loan 

2,511,604 3,522,895 Securities/Operations 551,870 1,060,428 Cash 
2,500 2,500 

Pey Pationt Day Capital Cost $3. 4 
Ed 

7 

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yp , X yr Co; | RG ted 5/4 / 7/0 

 



i -A OT wei rv — ne pd cl ” . A AL A TY Ls Lars — a ET TT 2 ere 

® i 3 . - - 

ia ey : | ATTACHMENT /5-8 

. the 

  

    

        

    

gr 5 | | : or STATE PROJECT NUMBER DATE 

: ‘A. (Continned) : ne ed rd ia SEDER BS Pola - 
~~ LEE . : { 

; i 
f H pv Ar wv ——————— Ao ha on thoy 

3. STATEMENT OF INCOM. | ta ae ACEI Pe TEED EY 
Give information for lust three (3) years for which complete data : : 

    

: y yo ‘ gy 
:, : are available 1973 is : 197% a 1902 

: i J oh Fl a Iie z 

Fevenue from Services to Patients: hE : ; ; ETRE nr 

i: A Inpaticnt Services > 3 , 7 RS : 

SNE) Eh Foutine (Nursing Service Areas) | 7,431 dB) 2.972 010. } —3y322,5 Hid | 

% Ofte: I h.937.931 | 5.636.477 | 7.200.085 
Outpatient Services eta 899, 60h 212, 2 80 _ ek: A ,633,356 a reg es AER CA Se A” A cys inn. waite B 

Lmergeacy Services : 172 2 1 78 0 6 Bi523 174 2317555 i 

  

  

  

  

Other Operating Kevenae 56,390 | © 48,091 68,320 
341,018 505,017 Fo 388, 26h 

Recoveries 
  

Other 

Ey : ; 13,838,399 | 15,302,457 | 18,937,916 Gross Operating Revenue EM SS SBCs BA LA We Lilt Tt 3) Shed) 

reir men Con verse a   
  

Deductions from Operating Revenue: PA 7 

Contract Adjostinents ___ 49 8, L432 769, Rak 834, Oe 

Pisconnt/ Misc. Allowances Tk > Em fh 16,295 RATE: +595 8 Pe Bb, L035 : 

Viovisean fon Chaily Segvices' Li Cn A Se | 48, 220 of Wir 4 Wo se yt 750. y: 

Brovision fox Unolivetil.log i nnn a a 671.65 Bo marian ens O05, 851. 

ay Total Deductions ; 1 2 234,600 1,569,682 | 1,974,639 

  

  

    

    

  

    

  

  

  

Net Operating Revane 5 A en as 12, 60 LIL a 13,232,725.) 16.9 3.217 

Operating Dapoenses: 17 491 3 O51 2 0 8, 230. 1" . 

i I ETE ds EAN Pn LD I A Sa a en LO ; 2.2 2. t9 : 5,051, £N fie LP yi : 

Mhysichyiy Salapien'& Fees S000" Bn Diag Po TE es (hs 844 »J2 3 wn Rid 992,237 1 Th, 556 

Deppbeletion Lo Ser Lope al pen Ee a 1 B38, fis DO a RON Wing TL TL 
Interest-Mot | FAEY eC EA A hat ee a i a at al i Li UY ro Se Tiley VI Ss Se a eld onal Bhs we aE eas arab   

fnterest thesia dap Ue TH ed pe eRe ei CID De5 EE ori 
78 3G Te v aie 

I EE EE A ae A La an he al an hon oh 473.006 4 6.09% 203. 
rd 

Vota Opedting Vapi Lo i ie iit V2 18 7 831. METIS Brees Bh 

Opoeatingy Lavoie i) aw): i tp RE SE I Si I i NY —— ————— aa Rt J ry. SY re +   

theriPvwom (d species) Sel : —— — reas om capi re —— A a Ae =f 3. 8 arn hs a mere - —— —— oe mente ot 

a ve, 8 | sats 1 749.371           Sues oe weirs ’ rea hoe ps . rua Se abst ert ts amram A ant gree AUG SAGs mss eg ro ee Oa rm Al re es ey EAM  



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