City lends Sierra $1.25 million for new operation Health care firm putting regional headquarters, 300 jobs downtown


March 12, 1998|By Gerard Shields | Gerard Shields,SUN STAFF

Sierra Military Health Services Inc., a Las Vegas-based company that provides managed health care for the nation's veterans, received a $1.25 million loan yesterday from the Baltimore Board of Estimates to complete its regional headquarters downtown.

The city support includes a $250,000 loan, half of which would be forgiven if the company hires 175 Baltimore residents. City officials also guaranteed a $1 million loan for improvements to be made to the Candler Building, at 111 Market Place, where Sierra is locating. Sierra is to pay back that loan.

The company already has hired about 290 people for an expected 300 jobs it created for the new operation, but it was not clear yesterday how many of them are city residents. About 70 have been hired through Employ Baltimore, a city-supported job placement agency and 40 other workers are former welfare recipients, officials said.

Sierra, which provides HMO-type health care for military members, retired veterans and their families, opened the operation last month.

"The loan further solidifies our relationship with the city," David Nelson, Sierra's president, said yesterday. "We're looking forward to a long relationship with the city."

Sierra, created in 1995, won a $1.2 billion federal contract to provide managed services to 665,000 military members and their dependents.

The contract is being contested by a competing bidder.

A spokesman for the U.S. General Accounting Office said the agency expects to complete the protest review by June. Sierra leaders told the Board of Estimates that the city money wouldn't be in jeopardy if the federal contract is withdrawn.

About two-thirds of Sierra's workers will staff a 24-hour customer service phone center.

Others jobs will include reviewing medical care requests and conducting inspections.

Sierra officials and Baltimore Development Corp. members said the new operation should create another 288 spin-off jobs throughout the state.

Sierra will have service centers in Annapolis and near the Patuxent River Naval Air Station in Lexington Park.

The new Baltimore jobs are expected to contribute $26 million annually to the area's economy, BDC officials said. Sierra's move downtown is considered the largest influx of new downtown jobs in three years and one of the biggest in a decade.

"Usually, we bring in about 100 to 200 jobs. This is a little bigger," M. J. "Jay" Brodie, the BDC president. "And one of the city's greatest growth areas is in medical services."

City Council President Lawrence A. Bell III said he was glad that Sierra chose Baltimore over surrounding counties that have lured away city businesses in the past.

"These are the kinds of things that you have to do to compete with the outlying counties," Bell said of the loans.

Pub Date: 3/12/98

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