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Fire destroys original Monsour Hospital building

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By Richard Gazarik
Tuesday, April 30, 2013, 7:48 a.m.
 

A fire early Tuesday that destroyed the original Monsour Hospital and Clinic on Route 30 has paved the way for the city of Jeannette to take possession of the property and the adjacent cylinder-shaped medical center so both can be demolished, the city's attorney said.

Scott Avolio said Westmoreland Priority LLC, which holds $35 million in debt on the now-defunct Monsour Medical Center, will turn over the revenue bonds to the city, a move that will expedite razing the dilapidated complex and redeveloping the site.

Westmoreland Priority LLC is made up of Dr. Howard Monsour Sr. and his sons, Dr. Howard Monsour Jr. of Texas, Michael Monsour of Pittsburgh and Dr. William “Boone” Monsour of Ligonier.

Michael Monsour, CEO of the medical center when it closed in 2006, said shareholders have agreed to the transfer.

Avolio said the raging fire at the old stone building that housed the original hospital when it was founded in the 1950s makes quick action by city officials even more pressing. The deteriorating stone house and the adjacent medical center have been targeted by three arsonists, as well as vandals and squatters.

“It repeatedly draws attention to what a danger this place presents to the entire county as well as the city,” Avolio said. “It's further evidence this should be on top of everybody's list of what needs to be accomplished.”

The building was last used by a Monsour-related entity, Key Care Home Health.

The fire was intentionally set, state police said. A trooper on patrol shortly after midnight saw the flames and called 911.

Firefighters said that the blaze started in the basement and flames quickly traveled to the ramshackle building's second floor, blowing out windows and collapsing the roof.

No injuries were reported, and no one was in the building, officials said.

Avolio cautioned that even with the bond transfer, tax dollars will be needed to demolish and revive the property along a busy stretch of Route 30.

“I don't see how this project can be handled on the private side,” he said. “The city cannot pay out-of-pocket to fund this project.”

Even so, there are legal entanglements that remain, Avolio said.

By assuming the debt, the city will be subordinate to federal liens imposed by the IRS and Pension Benefit Guaranty Corp., but could force the hospital's defunct board of directors into involuntary bankruptcy. The city would file a mortgage foreclosure and ask the court to appoint a receiver or to erase the liens and put the land into the private market for sale.

Avolio said he hopes the debt transfer can be accomplished within 30 days. One potential roadblock is Dr. William Monsour, who listed a 6 percent ownership in Westmoreland Priority LLC when he filed for bankruptcy earlier this year, Avolio said.

The transfer could require approval by a federal bankruptcy judge, he added. In 1952, Dr. Howard Monsour started the seven-bed clinic in the stone house that was built in 1750 as a stagecoach stop, said Michael Monsour. It was once the residence of Dr. Robert Monsour, who died last week.

Howard Monsour founded the facility with his brothers, Drs. Roy and Robert Monsour. A fourth brother, Dr. William Monsour, joined them later. Both Roy and William Monsour are deceased.

In 1954, a 50-bed hospital was constructed adjacent to the stone house. The canister-like tower was added in the mid-1970s and the name was changed to Monsour Medical Center.

The city has condemned the structure as a public safety hazard to Route 30 traffic and pedestrians.

In 1989, the Jeannette Health Services Authority underwrote $19 million in revenue bonds to help the medical center extricate itself from bankruptcy. The hospital defaulted on the bonds, and Dr. Howard Monsour Sr. purchased the outstanding $16 million in bonds for $3 million, according to county court records. Westmoreland Priority LLC was created in 2007, state records show.

Over the years, interest on the debt accumulated to nearly $19 million and stands at nearly $36 million.

In 2007, Westmoreland Priority foreclosed on the property, seeking payment of the debt. A county judge entered a judgment in favor of the corporation. But the Service Employees International Union and Pension Benefit Guaranty Corp. intervened to block a sheriff's sale because of money the medical center owed the union and government.

Richard Gazarik is a staff writer for Trib Total Media. He can be reached at 724-830-6292 or at rgazarik@tribweb.com.

 

 
 


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