HOUSE BILL REPORT

ESB 6519

BYSenators Anderson, Smitherman, Deccio, Rasmussen, Hayner, Conner, Zimmerman, Craswell, Gaspard, Wojahn, Stratton, Johnson, Kiskaddon, von Reichbauer and Garrett

Changing provisions relating to the method of determining the depreciation base of certain nursing homes.

House Committe on Ways & Means/Appropriations

Majority Report:  Do pass with amendments.  (12)

      Signed by Representatives Belcher, Braddock, Bristow, Ebersole, Grant, Grimm, Hine, Sayan, H. Sommers, Spanel, Sprenkle and Wang.

Minority Report:  Do not pass.  (1)

      Signed by Representative Locke, Chair.

House Staff:David Knutson (786-7126)

AS REPORTED BY COMMITTEE ON WAYS & MEANS/APPROPRIATIONS

FEBRUARY 27, 1988

BACKGROUND:

The federal government, effective July 18, 1984, changed the method used to determine the depreciation base for nursing homes.  A nursing home which changed ownership at this time was negatively affected.

SUMMARY:

AMENDED BILL:  Nursing home contractors who can prove they purchased a nursing home prior to August 1, 1984 and submitted necessary documentation to the Department of Social and Health Services prior to January 1, 1988, will have their depreciation base set not to exceed the fair market value of the assets at the date of purchase.  The Department of General Administration will determine the fair market value through an appraisal process.

AMENDED BILL COMPARED TO ENGROSSED:  A technical correction relating to depreciation involving lessee operated nursing homes is made.  The reference to the 1988 supplemental operating budget is deleted.

Fiscal Note:      Available.

House Committee ‑ Testified For:    Harlan McNutt.

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    One nursing home operator was harmed by a change in federal law relating to nursing home reimbursement provisions.  The state should correct this problem.

House Committee - Testimony Against:      None Presented.