Downtown Fresno, Calif., today is a mix of older four- and five-story buildings, deserted pedestrian bridges, sparse landscaping and an aura of quiet dispiritedness.
Downtown Fresno by the end of the decade is envisioned as a shining example of redevelopment, boasting a new $111 million federal courthouse, a $25 million minor league baseball stadium, an expanded convention center, new office space and a development with as many as 250 new homes. Anchoring all the disparate projects would be a gleaming new hospital.
The downtown dream of this central California community may or may not materialize, but the hospital is a sure bet.
The 58-acre campus for the new 525-bed Community Regional Medical Center will span several square blocks when it's completed by mid-decade, including two streets the city recently closed off. Cost of construction is estimated at about $220 million.
The project will consolidate two existing facilities: 375-bed Fresno Community Hospital and Medical Center, which is on the current redevelopment site, and 334-bed University Medical Center, two miles east. They're both operated by Fresno-based Community Medical Centers.
Community assumed management of University Medical, formerly known as Valley Medical Center, from Fresno County in October 1996 to reduce costs while preserving the county's public health services. The county agreed to pay Community $17.5 million per year over 30 years for running the facility and affiliated clinics, although some of that cost is now being defrayed by
$3.5 million a year in federal funding Community receives for indigent care. Community also operates a third facility, 143-bed Clovis (Calif.) Community Medical Center, just north of Fresno.
The two Fresno hospitals have divergent finances. University Medical Center--the region's major provider of indigent care--lost $5.5 million on revenue of $146.9 million in 1997, according to the most recent data available from HCIA-Sachs, a Baltimore-based healthcare information company. Fresno Community Hospital posted net income of $9.9 million on revenue of $160.9 million in 1998.
"(The merged hospitals will) be a major asset for downtown," says J. Philip Hinton, M.D., Community Medical Centers' chief executive officer.
Although about $50 million of the project's cost is coming from state and federal funding, the city of Fresno is pitching in as well. By the time work is done the city will have spent about $9 million from its own funds on the hospital project. That includes about $1 million to buy downtown parcels to accommodate construction; the parcels have been sold back to Community at $4 per square foot, or about 20% below the market rate. The city and local utilities have also footed the bill for the enormously complex job of relocating utility connections, rights of way, and homes and businesses.
"I've been doing healthcare architecture for 35 years and I've never encountered this type of relationship," says Jerry Quebe, senior vice president of RTKL, a Baltimore-based firm that is the lead architect on the new Community Regional Medical Center.
"It's an unusual proposition, but an interesting approach," says Robert Myrtle, professor of health services administration at the University of Southern California. Myrtle says that while cities and hospitals often work together, rarely is an acute-care facility the anchor for redeveloping a neighborhood or downtown.
However, healthcare experts say cities often like to work with hospitals because of the community benefits they represent and the large number of jobs they provide. With about 4,500 employees between its two hospitals, Community Medical Centers is nearly twice the size of Fresno's second-largest employer, the Zacky Farms poultry business.
"Hospitals do account for a lot of traffic--patients, visitors and staff," says Ed Blakely, dean of the Robert J. Milano Graduate School of Management at the New School University in New York and an authority on development in California's San Joaquin Valley. "In terms of redevelopment, it can have a very synergistic effect."
At the same time, experts say the cooperation between public and private parties taking place in Fresno is becoming increasingly rare because of the not-in-my-backyard mentality of many community activists.
"There have been many instances where recent hospital expansions have met the opposition of local residents because it would . . . create more traffic congestion," says Tom Rundall, professor of health policy and management at the University of California at Berkeley. Rundall pointed to recent expansion projects involving Children's Hospital Oakland (Calif.) and Alta Bates Medical Center in Berkeley, both of which ran into vocal community opposition. In the Alta Bates case, the city attorney's office sued to block the opening of a new obstetrics ward (April 7, 1997, p. 82).
But there are a few differences in Fresno's case. One is the management contract the Community system has with the county. It stipulates that Community build a new burn unit and trauma center by mid-decade--clauses that discourage the local government from interfering with construction. Another is that Fresno city officials say the plan makes perfect sense.
"Rule 1 (in redevelopment) is build on what you already have. The hospital was landlocked, and they needed to put something together for expansion," says Dan Fitzpatrick, executive director of Fresno's redevelopment agency.
There is no lack of land for expansion in Fresno, one of California's fastest-growing cities with a population galloping toward the half-million mark. The rural areas surrounding the city provide plenty of virgin tracts to build on, meaning previously developed sites are often bypassed. Even retail sites constructed in Fresno as recently as the 1970s and 1980s have been abandoned in favor of new construction.
"Fresno is the queen of urban sprawl," Blakely says. He has authored articles in the past on Central California's urban planning.
The hospital might well be a counterpoint to that trend--concentrating doctors offices and laboratories and other nearby businesses in a relatively small area in the central business district.
"There are many businesses that would love to relocate around a regional medical center--hotels, shopping centers and restaurants," says Hinton, Community's CEO.
However, Blakely cautions that the new hospital could have trouble fulfilling its redevelopment mission if it offers too many services on campus. "It would be a good idea for them not to have a cafeteria or any other retail operations on-site," he says, adding that the Kaiser hospital built in 1995 in the Bay Area city of Richmond failed to meet redevelopment expectations because so many of its consumer-oriented operations were within the hospital campus.
Avoiding such centralization could put Community in a quandary. Quebe, the hospital architect, admits there are "very few places for people to go that are within walking distance of the hospital." He adds there is a possibility the hospital may bring in some private food vendors, such as an established fast-food chain. A hospital spokesman noted that the current gift shop at Fresno Community Hospital will serve as the gift shop for the enlarged campus, and that there are only minor plans to enlarge the existing cafeteria.
Whether or not the hospital proves a draw for other businesses, it will continue to be a safety net for the community, project officials say.
"It will be a gateway for downtown Fresno, and it will be happening," Quebe says.