Lansing — Michigan Gov. Gretchen Whitmer’s administration is pausing plans to replace the aging Caro Psychiatric Hospital with a new facility in the same city and will instead hire a consultant to recommend next steps, including other potential locations.

Officials are delaying the Tuscola County project because of concerns with staffing shortages, the ability for patients’ families to be involved in their treatment and access to water, the Michigan Department of Health and Human Services announced.

“Based on these issues, we have decided to seek outside consultation to review the proposed Caro Center project to determine what is in the best interest of Michiganders who need critical state hospital services,” Director Robert Gordon said in a statement about the Thumb region facility.

“Bed capacity, access to trained staff and proximity to family and community services will be a part of the reexamination.”

The state plans to continue operating the current Caro Psychiatric Hospital, which first opened in 1914, during the review. Recommendations are expected in June.

Tuscola County Controller and Administrator Michael Hoagland said local officials are “in shock” after learning of the state decision, noting the psychiatric hospital has 350 workers and is the area’s second largest employer behind the county government.

Local officials had collaborated with lawmakers and former Gov. Rick Snyder’s administration to keep the psychiatric hospital in Caro.

 “We just worked our tail off, because we knew the importance of that facility to this region,” Hoagland said, noting officials will also attempt to make their case to the Whitmer administration. “The last one out, shut off the lights if that leaves this area.”

State Rep. Phil Green, a Millington Republican who took office in January, said he was “devastated” by the announced delay that could portend eventual closure of the Caro hospital.

“I can only imagine the response of the other trained professionals who are employed at the facility,” he said. “Those employees also residents of our region. They shop. They coach little league.”  

The Republican-led House may look into the “legality” of the move and whether Whitmer can “unilaterally disregard state law,” Green said. An appropriation for the project, as well as the site location, was written into a state budget bill last session, he said.

Sen. Kevin Daley, R-Lum, said he believes the Whitmer administration has “the right” to review the project but called it “a shame that we’re starting out at ground zero” again after her predecessor had given it a green light.

“They’re assuring us it’s not a death sentence," and local officials will continue to push for the Caro project, Daley said. “They just want to do more studies at more cost to the state.”

Snyder celebrated plans for the new Caro facility and attended a groundbreaking ceremony in October.

But Whitmer’s administration said the current hospital is facing significant challenges beyond the aging building, including staffing shortages and barriers to recruitment in the rural area in Michigan’s thumb region.

There is not currently an active permanent psychiatrist on staff at the Caro facility, the state health department said, explaining that psychiatrists from other state hospitals have been brought in to provide treatment.

Only 30 percent of the 86 patients now living at the facility have family within 75 miles, which “challenges family and community engagement” that can be key to psychological stability and improvement, the state said.

Additionally, the state said concerns over water sourcing for the new facility have  already delayed design and could cost an additional $2.4 million on top of the $115 million budgeted for the project.

The new Caro facility was expected to serve 200 adult patients, up 50 from current capacity. The Snyder administration vowed it would be a “state-of-the-art” facility that would improve recovery outcomes for patients.

Upon announcing the project last fall, the Snyder administration said Granger Construction Co. would serve as project manager and had already begun demolishing some existing structures. Construction was expected to start this spring.

The state has already spent about $3 million on the project, said Lynn Sutfin, a spokeswoman for the Michigan Department of Health and Human Services. The department has not yet named a consultant to review the project but expects to use an existing state contract to cover those costs.

Hoagland questioned how much the state had spent to hire architects and engineers for the project, which is “well along as I see it.” He noted the county hired an engineer to figure out the best way to run water to the new facility.

“Our chins just dropped when we heard the news,” Hoagland said. “I imagine there will be outrage in this small community" that was anticipating additional jobs at the larger hospital. 

“I told my wife, 'Let’s not make many home improvements, because land values are going to collapse if the second largest employer leaves the community.’”

Green expressed similar fear, suggesting that losing the facility would "irreparably" damage Caro, leading to vacant houses and closed businesses if employees flee for other jobs

"This is just going to be a huge, sucking sound of people leaving," said the first-term state representative, whose father, former Sen. Mike Green, had fought to keep the psychiatric hospital in Caro. 

He noted that Whitmer last month blocked the sale of a shuttered Ionia prison, vacant more than a decade, to a for-profit detention company that wanted to use the facility to house detained immigrants.

Snyder had agreed to sell the facility to Immigration Centers of America, but the East Lansing Democrat cited ‘Michigan values” as she reversed the decision because the company was unable to guarantee the facility would not be housed to detain adults who had been separated from their children at the border.

Republicans argued the decision cost Ionia 250 jobs, and Green said moving the Caro Psychiatric Hospital would cost Tuscola 600 jobs that had been anticipated at the new and expanded facility.

“I view this as, she’s probably going to propose that we build a state hospital in a county that voted for her,” he said. “This is part of her plan.”

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