Kingfisher Regional Hospital board President Pat Cheap was expected to sign papers Friday afternoon on a $10.5 million loan to refinance the remainder of the construction debt for the new hospital.

The refinancing package was unanimously approved by KRH membership at a special meeting Wednesday, the last approval required for the loan through F&M Bank which will allow the hospital to pay off construction bondholders and save about $1.8 million in interest costs, Cheap said.

Reducing the interest rate from 6.5 to 4.1% was expected shave nearly 10 years off the anticipated debt retirement date.

However, thanks to a $1.3 million reserve to be released by UMB, the trustee bank for the bondholders, the size of the refinancing loan was reduced accordingly and the payoff may be even sooner.

“If our projections are accurate, we’re looking at being able to pay off the loan in eight to nine years,” Cheap said.

That’s good news for Kingfisher taxpayers, who are on the hook for a 1% dedicated sales tax that will expire in 2034 or sooner if the debt is repaid early.

Prior to refinancing, the repayment date was estimated at as much as eight years after the expiration date of the 25-year tax.

But now that may happen as soon as 2029 or 2030, triggering an automatic early termination of the tax.

Although the new hospital building is leased by and operated as Mercy Hospital Kingfisher, KRH owns the real estate and other physical assets and is responsible for paying the debt.

In addition to Cheap, current members of the board of directors include: vice president – Dorothy Hallock; secretary – Jarod Hendrix; treasurer – Brenda Walta, and members – Colton DeMuth, Joe Voth, Kim Grellner, Tiffanie Barnett and Diane Duffy.