Mayor Announces Settlement; Awaiting State Approval

After a judge in U.S. Bankruptcy Court in Newark on Thursday approved a bankruptcy settlement and the sale of the Hoboken University Medical Center to HUMC Holdco LLC, the mayor said she is hopeful that the sale will go through without any problem in about two weeks. Before the transaction can happen, the state health commissioner has to approve it and issue a "certificate of need."

There is a two-week period in which objections can be filed. After that period—during which Zimmer said she doesn't expect any objections to the sale—the transaction can happen.

"This is the best possible outcome for Hoboken," Zimmer said. Without the sale, the city is on the hook for a $52 million bond, which would have had the potential to "destroy the city's finances," she added.

The settlement that was approved includes a $10.2 payment to the hospital's creditors. Of that settlement, $5.2 million comes out of the sale proceeds, while another $5 million

The group of employees in the lobby of the hospital applauded the mayor multiple times during a speech.

Philip Scheangold, the chief transition officer of the sale to Holdco, said that the new owner will invest in several departments of the hospital. "We've identified opportunities for improvement," he said. Holdco, Scheangold continued, plans to add a cath lab to the facility.

Close to 1,200 of HUMC's employees will stay at the hospital, which is more than 90 percent of all employees, Scheangold said.

"I'm glad with the outcome," said Scott Whalen, a security officer at the hospital and captain of the Hoboken Volunteer Ambulance Corps. Without HUMC, Hoboken's ambulances would have to go out of town to Jersey City Medical Center or Christ Hospital, which would add 20 minutes to the response time, Whalen said.

For Doreen Romero, 53, Friday was less festive, because she was one of the minority of employees who weren't re-hired. She was part of the medical staff for 4,5 years, she said.

On Thursday, JNESO—the nurses union—withdrew its, paving the way for a deal and approval of the sale.

The process of the sale has been under scrutiny by Zimmer's critics on the city council, such as council members Beth Mason and Michael Russo, as well as other elected officials—such as State Sen. Loretta Weinberg, who all made allegations of an illegal bankruptcy and a too secretive process.

"The judge’s ruling today makes it crystal clear that the allegations we’ve been reading about had no basis in fact or law," Zimmer said. 

It's still unclear when the approval from the state will come, but Zimmer said she hopes it will happen within two weeks. Earlier this year—before the bankruptcy negotiations—

Zimmer said she hopes the approval will come quick. "We're running on fumes here," she said.