Rep. Tom Reed said Wednesday upward of $5 million will be allocated to Lake Shore Hospital through the Federal Emergency Management Agency.
"The funding we've secured is a huge positive development for the hospital and more importantly its long-term viability," Reed said in a press release. "The confirmed funding will make the hospital more attractive in the long run for potential investors and buyers, making the likelihood of the hospital remaining in our community that much more of a reality."
In a phone interview Wednesday evening, Reed explained the $5 million would not be distributed to the hospital to use for operations but will reimburse capital improvements and equipment acquisitions.
"If I'm a purchaser, that FEMA money that is locked in for capital needs of the facility makes the investment much more viable," he said.
Reed explained the hospital's application for funding from the damage in the 2009 flood in Gowanda had been waiting 180 days for a decision.
"The application was bogged down in FEMA bureaucracy. It had been 180 days when the typical wait for a decision is usually 90 days," he said.
Reed said by putting pressure on FEMA, his office was able to secure the $5 million. He was assured Wednesday by the FEMA Regional Administrator for New York that the disaster funds were approved.
When asked how Lake Shore Hospital's Chapter 11 bankruptcy protection filing will play into this, Reed said he is not an expert, but knows the court will be made aware. He said from the position of the bankruptcy court, the funding should be good news.
"This bodes well from a bankruptcy perspective because you need to prove that the facility will be viable. ... This makes that more realistic," he said.
State Senator Catharine Young and Assemblyman Andy Goodell commended Reed for his efforts.
"I applaud Congressman Reed for his successful work in securing this much needed funding. His efforts have been vital to the progress we are making for Lake Shore Hospital, and I commend him in this great accomplishment. These federal funds, combined with state assistance, will go a long way to keep Lake Shore's doors open so they can provide critical services to patients from our communities. Assemblymen Andy Goodell and Joe Giglio, Senators Mark Grisanti and Patrick Gallivan, County Executive Vince Horrigan and County Legislator George Borrello are pulling together with me. More than a thousand people taking part in the rally shows how important this is to the region and we will continue to fight on behalf of the people who need Lake Shore," Young said.
"The news from Congressman Reed is tremendous for Lake Shore Hospital. Our work to keep Lake Shore open reflects a full court team effort, as indicated by Senator Young obtaining a million dollars of emergency state assistance and Congressman Reed obtaining over $5 million in federal funds. County Executive Horrigan and his team are fully committed to helping secure investors. We won't stop until Lake Shore is saved," Goodell added.
A major employer in the area, Reed's goal is to keep the jobs in Chautauqua County and ensure families are not prevented from receiving critical care close to home. The hospital employs over 450 workers and serves northern Chautauqua, southern Erie and western Cattaraugus counties.
The hospital filed a plan of closure with the state Department of Health in October and filed for Chapter 11 bankruptcy in December to reorganize operations. Young recently secured $1 million in emergency funds from the state Health Department to keep the hospital open while it goes through the process of possibly finding a buyer. The U.S. Bankruptcy Court in Buffalo will consider the health department funding at its next hearing on Jan. 22.