MARTINS FERRY — East Ohio Regional Hospital now has some additional cash to work with as it navigates difficulties with property taxes that are in arrears and a decision by The Health Plan to discontinue employee health insurance coverage due to “financial obligations not being met.” Martins Ferry City Council held a special session at 1 p.m. Monday and voted to release income tax revenue that was owed to the hospital. According to Mayor John Davies, the city has a 1% income tax that is paid by all people who work in the city and by city residents who do not pay income tax in a different community where they work.

“So basically it was income tax money that the city was holding of theirs,” Davies said. “And they had to supply us with capital improvements documentation.”

Davies said the amount released was “just a little under $34,000.”

“Of course we get 1% income tax,” Davies said of the tax. “And when the hospital was opened, we negotiated a three-quarter-percent return on that money, which they use for capital improvements. So, whenever they do a capital improvement on the hospital, we release that money back to them.”

Davies explained that the hospital receives three-fourths of the income taxes paid to the city by the hospital’s full-time employees. The hospital does not receive any other share of the city income tax, and the agreement does not apply to part-time employees of the hospital.

The mayor added that a capital improvement could be any one of a wide variety of improvements, including things such as new boilers or “anything that improves the facility.” He noted that the hospital must request the money through city Solicitor Paul Stecker, who is tasked with making sure the improvements were completed and documented properly before recommending that the city release the funds.

Davies did not know offhand Monday evening what the most recent improvements had been.

Davies said the agreement between the city and the hospital is for a term of 10 years, and he believes it has reached the end of year four or beginning of year five.

EORH also is in talks with the Belmont County treasurer regarding more than $1.2 million in unpaid property taxes. According to Treasurer Katherine Kelich, EORH Chief Operating Officer Julie Ross is working with her office to make a plan for tackling the $1,214,357.10 bill. If an arrangement for the “very large delinquency” gets worked out, no foreclosure will be filed, Kelich said.

Access Martins Ferry LLC, the company that owns EORH’s property, had challenged the property value assessed by the Belmont County auditor. The company then filed a complaint with the Board of Revision, whose decision it took to the Board of Tax Appeals, a process that didn’t conclude until late 2024, Kelich said. During this time, the company held off on making payments in anticipation of a decision in their favor by the court.

The last payment the hospital made to the county was in May 2023.

The hospital also announced last week that it will be closing its long term care and skilled nursing facilities, raising concerns among employees and Martins Ferry residents about its financial status and the future of the hospital.

EORH administrators, including Ross, have not responded to several requests for comment.

In an email to all EORH staff on Friday, Ross touted “progress” made earlier last week, including talks with Davies, Kelich, a county commissioner and state government officials seeking assistance.

“We have made incredible progress to address the issues of health insurance, taxes, and future growth of our hospital,” Ross wrote. “We still do not have all the answers to the questions, but this has been one of the most productive weeks we have had to continue operations at the hospital.”

Ross thanked employees for continuing to show up to work, care for patients and do their jobs despite the “challenges that we have had.”

“Our promise to the employees of this hospital is that we will continue to keep you informed and update you on any of the progress that we have made,” Ross added. “There is no way to do this without everybody doing their part, and we cannot do it without the whole team. It is hard to stay positive when there is so much going on around us, however most of us have been here from day one and we believe in what we’re doing, and the community believes in us. I know that we will get through the difficult challenges.”

Founded in 1906 as Martins Ferry Hospital, EORH operated until 2019, when then-owner Alecto Healthcare Services closed both it and Ohio Valley Medical Center in Wheeling. The hospital was purchased by Dr. John Johnon, a psychiatrist who operates other health care facilities, and reopened in February 2021.