NATCHEZ — Community Health Systems executed Friday the agreement Adams County’s board of supervisors ratified a day prior for the company to purchase the county-owned Natchez Regional Medical Center.

Even though the hospital still has to go to auction to solicit potentially higher bids, CHS’ commitment means the sale of the 179-bed hospital is guaranteed pending the approval of the federal bankruptcy court.

CHS — which owns, operates or leases 208 hospitals in 29 states, including 12 in Mississippi — is the parent company of Natchez Community Hospital, which it acquired last year. The purchase of NRMC means the health care market in Natchez will be virtually consolidated.

“We look forward to completing this potential acquisition and working with the medical staffs and employees of both hospitals in Natchez in a coordinated approach to providing quality care for local residents,” said Wayne T. Smith, the chairman, president and chief executive officer of CHS.

The Rev. Leroy White, president of NRMC’s board of trustees, said the completion of the agreement was something for which he’d long prayed.

“I was mowing my yard, and when I got the news they had a finalized asset purchase agreement, I jumped off my tractor, ran up to the hospital and signed it ASAP,” White said.

While White has acted as a board spokesman for the hospital’s trustees throughout the sales process, he said he and the board will be writing an open letter to the community explaining what they’ve done over the last year since recommending the sale of the facility.

“I am very happy about this sale,” White said. “We got $18 million for the hospital, but they are going to take that and make the value (of the hospital) a lot more than that because of what we are going to gain through their investment.”

The sale agreement includes a $10 million cash payment and $8 million in pre-paid taxes.

While the supervisors approved the agreement, all said they viewed it with mixed emotions.

“It’s kind of bittersweet,” Supervisor Mike Lazarus said. “I would have loved to take the hospital and turned it around, but all the experts — including the Horne Group — say it can’t be done, and I can’t afford to gamble with taxpayer money. But when it is all said and done, through this sale, the taxpayers are off the hook for the bond payments.”

The Horne Group completed an assessment of the hospital last year that said it could not sustain operations as an independent body.

Lazarus said projections from the sale say all of the hospital’s vendors for the bankruptcy can be paid off.

“As far as the county realizing any gain out of it, it is not going to happen,” he said. “That is the part that hurts me, because I feel like it was one of the biggest assets the county had, and we are losing it.”

Supervisor David Carter echoed Lazarus’ sentiments, saying he would have liked to see things turn out differently.

“Unfortunately, we are in a situation where we have to do what we can to get the taxpayers out of a bind, and this is it,” he said.

“It would cause more damage for us to deny it than to accept it.”

But Carter and Supervisor Calvin Butler both said they see net benefits from the sale in that having one company running both hospitals will eliminate some of the community’s long-standing health care problems.

“CHS will bring the future of health care for our community to a much higher, much more stable, level,” Carter said.

Supervisors President Darryl Grennell said he was pleased with the end result of the sale, but it had not played out the way he had anticipated.

“This was the first time this has ever happened where the process has gone so far, and I guess there were a lot of things that we were expecting that didn’t happen like we expected,” Grennell said. “At the beginning, I thought we would have a plethora of individuals interested in the hospital, and of course that has changed.”

The hospital wasn’t bankrupt when the sales process started, and in the initial query for potential buyers the supervisors, at the behest of the trustees, had limited potential bidders to non-profit health care systems, meaning CHS and the then-parent company of NCH, Health Management Associates, were initially excluded from the process.

Butler said he regretted that decision.

“If I could do something different, I probably would have allowed CHS to get into it sooner instead of going for the non-profits first,” he said. “I think we would have had more people interested in it at first if we would have opened it up to everybody.”

Supervisor Angela Hutchins could not be reached for comment.

Federal bankruptcy Judge Neil Olack is scheduled to review the hospital sale procedure Wednesday.

With the judge’s stamp of approval on the contract, the hospital will begin regional and national advertising for the auction.

Healthcare Management Partners Chief Executive Officer Scott Phillips, who led the sale negotiations for the county, said Thursday a tentative date for the hospital auction is Sept. 11, which will allow for the deal to close by late September or October.

In the bidding process the county supervisors approved in June, a qualified bidder would have to outbid CHS — who at the auction is considered a “stalking horse bidder” — by at least $1 million. Every subsequent bid would have to outbid the previous bid by $100,000.

The $1 million initial overbid requirement is to cover the cost of the stalking horse. In stalking horse agreements, the stalking horse bidder has a built-in financial incentive in case they are outbid because of the presumed risk they are taking on by being the stalking horse.

Under the adopted rules, qualified bidders will have to be able to demonstrate they can take on the business of operating a hospital and have the capital to bring the NRMC facility up to standard and potentially replace it in the long run.

Potential bidders will also have to put down a $500,000 refundable deposit.

Once the notice advertising the sale is published, county residents have the option of filing a petition asking to take the sale to a voter referendum for approval. The petition would require 1,500 signatures to take the matter to a vote.

If a successful petition is not filed, the hospital can go to sale without further objection.

NRMC opened in 1960 as Jefferson Davis Memorial Hospital. Its $2.4 million construction was underwritten by an $800,000 local contribution and state and federal funds.

It has been financially independent since 1974 and does not receive tax support, but is backed by a 5-mill standby tax that the Mississippi Development Bank required the hospital to get in 2006 when it asked for the MDB to reissue its revenue bond.

The hospital board of trustees announced in February its intention to declare bankruptcy, citing at the time a $3 million deficit between financial assets and liabilities.