Nursing home faces debt crisis

VIRGIL, ONT.

Pleasant Manor, a new Mennonite and Mennonite Brethren nursing home in Virgil, Ont. has been forced to come to terms with a $2.5 million debt. The Niagara Credit Union, which holds the mortgage on the home, asked for a repayment plan in late 1995. The plan would include merging the home with Tabor Manor (an Ontario MB Conference nursing home and apartment complex) and require the supporting churches to cover the debt.

The six Ontario churches bearing the brunt of that debt are Niagara United Mennonite Church and Orchard Park Bible Church (MB) in Niagara-on-the-Lake; Bethany Mennonite Church and Cornerstone Community Church (MB) in Virgil; and St. Catharines United Mennonite Church and Grace Mennonite Church in St. Catharines.

The debt problems date back to the home's construction, completed in October, 1994. The addition of luxury condominiums to the nursing home was made partway through the process, with the assumption that the sale of the units would offset construction costs. However, by the spring of 1996, six of the 18 condominium apartments remained unsold.

The nursing home was the latest addition to the larger Pleasant Manor complex, consisting of: 62 seniors' rental apartments (1977); 11 more rental apartments and 21 care units (1983); and 14 townhouse condominiums (1992).

Original construction costs of the nursing home came to $6.85 million. Through fundraising and the sale of the condominium apartments, the debt as of January, 1996 was down to $3.4 million. The Niagara Credit Union agreed to carry a $300,000 mortgage, and the expected sale of the remaining condominium apartments brought the total debt down to $2.5 million.

At a March 27 meeting, 300 people voted 87 percent in favour of a motion which would see Pleasant Manor nursing home join with Tabor Manor. With the new deal, the homes would share an administrator and the boards from the two homes would be amalgamated.

At an April 23 meeting, 400 people came to hear more details of the plan, which outlines savings via administrative and cost efficiencies. These savings are to support the payment of a $1 million mortgage to be held by the Mennonite Foundation.

The six churches, however, are still largely responsible for the $2.1 million debt. Pledges and earlier decisions have resulted in commitments to cover approximately $1.3 million, but the six churches will still be responsible for the approximately $800,000 remaining.

KH, from reports in Mennonite Reporter

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