Blood Bank of Alaska sells old building, lowers loan payment
The Blood Bank of Alaska has sold its old Laurel Street building, cutting a large chunk from the debt it owes to the Alaska Industrial Development and Export Authority for its new building.
“We consider this absolutely spectacular news,” BBA board chairman and Bristol Bay Native Corporation CFO Ryan York said in an interview. “We were calling it an early Christmas present.”
The Southcentral Foundation bought the building for unspecified purposes for a sum of $2.4 million.
Chris Bryant, a special assistant to SCF’s Resource and Development Department, didn’t give away any specifics in a statement to the Journal.
“Many of Southcentral Foundation’s programs are outgrowing their current facilities,” he wrote. “SCF purchased the Laurel Street building because it has ample space to support a clinic or medical office and is strategically located to the SCF campus. This building will help to continue to meet the growing needs of our customer-owners. The next step is to determine the highest and best use of the facility. We will then reconfigure the existing property to best provide for our expanding programs.”
The foundation, or SCF, is a subsidiary nonprofit of Cook Inlet Region Inc., one of 12 Alaska Native regional corporations established by the Alaska Native Claims Settlement Act of 1971.
ANMC is 63 years old and was established by the Indian Health Service in November 1953. The new location and the transfer of ownership from IHS to joint management by SCF and ANTHC occurred around 1997/1998.
The Laurel Street building housed the Blood Bank of Alaska until February 2016, when BBA moved into a new 57,000 square foot facility adjacent to Alaska regional Hospital.
Blood Bank management said the Laurel Street building was inadequate for blood banking regulations that had developed heavily since the AIDS outbreak of the 1980s.
York said the building is “not really usable in its current form,” though he doesn’t know what SCF intends to use it for. Agreeing with Bryant, he said he expects the building will need renovation for its new use.
SCF’s payment is less than the $2.7 million the Blood Bank had originally hoped for in its financial plans.
“We’ve only been out of the building for 10 months, he said. “In a good market you expect a building to move in 12 months, and we’re definitely not in a good market.”
In practice the difference boils down to $1,700 per month on the 35-year loan, which York said is relatively insignificant.
The building sale removes a large chunk of overhead from the AIDEA loan payment. At the beginning of the year, BBA CEO Bob Scanlon estimated the monthly loan service payment around $40,000 a month. With the building sale, York said the payment is now $212,000 per year, or $18,700 per month.
Though BBA’s capital campaign officially ended earlier in the year, York said the nonprofit still has ongoing two- to four-year pledges coming in.
The now-lowered AIDEA loan payment was central to a series of employee allegations against the Blood Bank of Alaska in the latter half of 2016.
In late summer, word surfaced that BBA was exporting 100 units of blood a week to LifeStream, a California blood bank. Such agreements are common within the industry of blood banking.
Blood Bank employees, however, filed two complaints to the U.S. Food and Drug Administration tying the export agreement to the loan payments. Employees alleged a shortage of blood on the bank’s shelves and a host of operational problems, including overly aggressive donor recruitment and unethical or illegal blood drawing practices.
Blood Bank leadership denies there have ever been any blood shortages. BBA provides blood for 22 of 25 Alaska medical centers, and each has filled its orders in a timely fashion.
In response to the employee complaints, BBA launched an internal investigation performed by three of its board members. The board members said in a detailed report that they could not substantiate any of the claims of Linda Soriano, the blood bank’s former grant writer who spearheaded the first complaint.
DJ Summers can be reached at [email protected].