BANGOR, Maine (AP) — A Maine hospital wants to exit bankruptcy temporarily, for long enough to qualify for a forgivable loan under a federal relief program.
Calais Regional Hospital and Penobscot Valley Hospital in Lincoln unsuccessfully sued because they were unable to obtain help through the Paycheck Protection Program because of bankruptcy proceedings.
Now Calais Regional Hospital is asking a judge to dismiss its Chapter 11 bankruptcy case so that it can seek at least $1.8 million in PPP funding, the Bangor Daily News reports.
The hospital's attorney, Andrew Helman, said First National Bank has agreed to extend a forgivable PPP loan if the hospital can leave bankruptcy. Once it secures the loan, the hospital would then re-petition for Chapter 11 bankruptcy to help restructure its debt.
Last spring, the hospital warned that its cash balance could fall to near zero by early this summer, but that was before the hospital received at least $3.7 million from other federal relief programs.
Penobscot Valley Hospital does not currently plan to leave Chapter 11 bankruptcy, according to CEO Crystal Landry.