The parent organization for Spokane-based Providence Health Care, the Inland Northwest’s largest health-care system, is seeking the issuance of up to $222.4 million in tax-exempt special-fund revenue bonds in a facilities refinancing request that includes properties here.

Providence Health & Services, based in Renton, Wash., is asking the Washington Health Care Facilities Authority to issue the revenue bonds to pay off bonds issued in 2006.

Colleen Wadden, senior director of reputation management for the big health care provider network, says its objective is to reduce the effective interest rate on that borrowing, which currently is 5.01 percent. 

Based on current interest rates, Providence expects to be about to reduce the interest rate it’s paying by about two percentage points, although the actual reduction won’t be known until the bond issuance is completed, Wadden says.

She says Providence is pursuing the transaction at this time because the bonds became “callable” last Oct. 1, enabling it to refinance without penalty. A callable bond is one in which the issuer can return the investor’s principal and stop interest payments before the bond’s maturity date.

Donna Murr, executive director of the Washington Health Care Facilities Authority, says a hearing on the Providence request was held last month in Olympia, with no members of the public testifying. Since then, the agency has been preparing final documents in anticipation of possible board consideration of the matter at a meeting on Sept. 8, she says. 

The Washington Health Care Facilities Authority was created by the Legislature in 1974 to provide an additional source of capital funding for nonprofit medical facilities across the state. Without Authority assistance, health care providers would have to borrow at more expensive interest rates and using taxable bonds and notes, the agency’s website says. It says the Authority last year helped nonprofit health care providers reduce their interest costs by more than $68.5 million.

The facilities to be refinanced with the proceeds of the latest Providence request consist of real property—land, hospital and clinic buildings, and parking and other structures—as well as personal property, such as equipment and fixtures, used for providing health care services.

Spokane properties in the request include Providence Sacred Heart Medical Center, at 101 W. Eighth; Providence Spokane Heart Institute, at 122 W. Seventh; and Providence Holy Family Hospital, at 5633 N. Lidgerwood, on Spokane’s North Side. 

Also included in the request are Providence St. Joseph’s Hospital, in Chewelah, and Providence Mount Carmel Hospital, in Colville, both of which operate under the Providence Health Care administrative umbrella, and about 10 other Providence Health & Services facilities around the state.

Providence Health & Services and smaller Irvine, Calif.-based St. Joseph Health announced in July that they’ve come together to create Providence St. Joseph Health, a nonprofit health and social services system that will serve as the parent organization for more than 100,000 caregivers across seven states.