Cheechako News file photo from KPC’s Kenai Peninsula Historical Photo Repository
Politicians lined up at the March 1966 groundbreaking for the new hospital. Pictured (L-R) are George Sundborg, administrative assistant to U.S. Sen. Ernest Gruening; Alaska gubernatorial candidate Wendell Kay; Sen. Gruening holding the construction plans with U.S. Rep. Ralph Rivers; Elmer Gagnon, Alaska director of the Federal Housing Administration; and Per Osmar, the hospital campaign fund manager.

Cheechako News file photo from KPC’s Kenai Peninsula Historical Photo Repository Politicians lined up at the March 1966 groundbreaking for the new hospital. Pictured (L-R) are George Sundborg, administrative assistant to U.S. Sen. Ernest Gruening; Alaska gubernatorial candidate Wendell Kay; Sen. Gruening holding the construction plans with U.S. Rep. Ralph Rivers; Elmer Gagnon, Alaska director of the Federal Housing Administration; and Per Osmar, the hospital campaign fund manager.

A hospital is born, slowly (Part 5)

It had been almost five full years since the start of a project to establish a hospital for the central Kenai Peninsula.

By Clark Fair

For the Peninsula Clarion

Author’s note: This is the fifth part of a six-part series about the origins of Central Peninsula Hospital, which celebrates its 50th anniversary in June. In parts 1-4, battles between Soldotna and Kenai over hospital location seemed to end as construction appeared about to begin in Soldotna. Read Part 1, Part 2, Part 3, Part 4 here.

Sound and fury

Five bulldozers cranked into noisy life on a large empty field west of Binkley Street in Soldotna. Two Caterpillar D8’s and three D7’s, each belonging to a different Alaska contractor, began scraping off topsoil and using the gravel beneath it to build a thick bed upon which the foundation of Central Peninsula Hospital would be erected. The plan on this March 28, 1966, called for the dozer crew to work six straight 10-hour days to complete the earthwork.

It had been almost five full years since the start of a project to establish a hospital for the central Kenai Peninsula. Now a community-wide effort was under way to make the dream a reality. Use of the dozers had been donated, as had been the labor, the fuel, and the surveying and staking of the property.

On Sept. 24, 1965, in a purely ceremonial groundbreaking event, Alaska Gov. William A. Egan had come into town to heft a few spadefuls of dirt — some of which was poured into tin cans, sealed and turned into souvenirs.

Officials in March 1966 expected all building plans and specifications to be complete by June, followed quickly by a call for construction bids, with work set to start in July. They wanted the building under cover by snowfall, allowing interior work to continue during the winter until the facility was finished at either year’s end or, at the latest, by spring of 1967.

Wishful thinking. These intentions went unmet. In fact, just over five more years would pass before the hospital welcomed its first patient.

Although Gov. Egan returned in September to smear his jacket with mortar as he helped lay the cornerstone — etched with “1966” and containing a small time capsule — one thing after another went wrong afterward.

In fact, about the only thing truly settled by September 1966 was the hospital’s location, a source of strife and hard feelings since the project’s inception in 1961.

In early 1964, as the Central Kenai Peninsula Hospital Association (CKPHA) struggled to raise funds for its choice of a Kenai location, the upstart Peninsula General Hospital Association (PGHA), spearheaded by Dr. Paul Isaak, began promoting a Soldotna site, presumably near the highway junction, as recommended by two site surveys.

Isaak’s new corporation drew immediate retaliatory fire. CKPHA president Ted Gaines wrote a letter to the editor of The Cheechako News to clearly delineate the intentions of his corporation from Isaak’s. Despite rumors to the contrary, he said, the CKPHA had no intention of disbanding and, in fact, had the more financially responsible plan.

CKPHA’s Membership Committee chair, Chester Cone, wrote an open letter in the next week’s paper to echo Gaines’s points and promote the CKPHA. “Do not be misled by plans of other groups who will depend on high-interest, borrowed money and private interests to build or fail to build as the case may be,” Cone wrote. “If you really want an area-wide hospital built in the near future, you must attend our meetings and offer your help in this tremendous undertaking.”

But Isaak also had defenders on the “Letters to the Editor” page. Soldotna resident Leo Phillips called CKPHA complaints “sour grapes” and the organization’s efforts a “hullabaloo.” He added: “This association has stumbled around … without accomplishing anything. Now they are out to scuttle the only possibility we have ever had of actually getting this much needed facility.”

He finished with a rant on financing and then clarified what he thought should happen: “If the CKPHA had the best interests of the area at heart, they would call a meeting of this abortive association, disband, and get behind an organization that really intends to build a hospital.”

Later, armed with blessings for a Soldotna location from the Central Peninsula Development Corporation and a promised loan of $350,000 from the federal Small Business Administration, Isaak forged ahead.

When Kenai’s only resident doctor moved his practice to Anchorage and the plans to build a hospital in Kenai fell through, the CKPHA tried vainly to keep its hopes alive. But by the time of the Soldotna groundbreaking, the CKPHA had been dissolved.

Almost a year before the dozers arrived, the PGHA board had met to make a final decision on location. Under discussion were 5 acres being offered by Jack Farnsworth for $30,000 just inside the highway junction, and 10 acres — about a mile from the junction and just west of Soldotna’s medical clinic — being offered by Joe Faa for $10,000.

By spring, the focus was squarely on the Farnsworth parcel, which Isaak had initially preferred and had in fact helped to clear some trees there. At a May 15 meeting, board member David Dietrick moved to begin negotiations with Farnsworth, but board secretary John Shaffer asked that the Dietrick’s motion be tabled until the board took a firsthand look at the Faa parcel so it could make a more informed choice.

After a field trip, the board returned, rescinded the motion to negotiate with Farnsworth, and moved to negotiate with Faa instead.

In a celebratory letter to Milt Eckhaus, a hospital designer-builder from California, Isaak wrote that it gave him “a great deal of pleasure” to request from Eckhaus, on behalf of the board, detailed blueprints and specifications for a modern 32-bed hospital to be built in Soldotna.

He added that he and his medical partner, Dr. Elmer Gaede, planned to purchase an additional 5 acres of Faa land adjacent to the hospital site for the purpose of creating their own new clinic. He hoped that Eckhaus would be able to design and build the clinic as well as the hospital.

Isaak got his wish concerning the clinic, but Eckhaus would neither design nor build the hospital.

Whether lingering ill feelings toward Eckhaus from some of the Kenai faithful were responsible or it was believed that selecting Alaskans to do the designing and building was preferable to assigning the job to an outsider, the PGHA board, just one month before the groundbreaking, decided to award the architectural contract to the Linn Forrest Architectural Firm of Anchorage.

Isaak was incensed. Eckhaus, who for nearly four years had believed that he would be designing and building the hospital, was even angrier.

Forrest, Isaak told Eckhaus, “knows very little about hospital construction.” Forrest’s preliminary hospital plans, he said, “I am sure he copied out of some book. After receiving a copy of the plans and reviewing them, I jotted down a list of 30-some items that needed to be changed or added. This was by no means a complete list but involved only the obvious things.”

Eckhaus’s April 1 response to Isaak expressed deep disappointment bordering on a sense of betrayal, and included an itemized bill for his services — $3,145, an amount for which he held Isaak and the hospital board solely responsible. “The costs reflected on the attached invoice cover actual cash out-of-pocket expenses and do not represent profit in any manner.” He asked that Isaak send him a check by April 15 “to help me meet my tax obligation.”

Isaak, however, had no $3,145 to spare, and the board refused to help. For the next four years, Isaak would chip away at his debt, periodically sending checks to Eckhaus, who never charged his friend any interest and, in May 1970, forgave the remainder of the bill.

In February 1968, near the hospital site, Isaak and Gaede opened their own medical-dental clinic, designed and built by Eckhaus.

But back in mid-winter of 1966-67, construction of the hospital itself was in trouble. Fundraising efforts had failed to generate the amount of local financing required by the SBA, and the agency, fearful that its loan might never be repaid, was withholding money due the architect, Robert Clay of Preferred Contractors (in Anchorage) and his subcontractors.

Clay had produced the low bid of $582,000 for the finished hospital, a job Eckhaus had originally claimed he could do for $400,000. As Christmas neared, Clay had received from the PGHA only $50,000 in donations, pledges and promissory notes.

Work stoppages were threatened.

Plans were altered to reduce the completion price to $400,000 — whatever it took to get the job done, finally. On Christmas Eve 1966, a U.S. Treasury check for $64,093.99 — the first of the monies from the SBA — was presented to Preferred Contractors. Hopes rose.

The Soldotna Chamber of Commerce was informed that it was likely that the hospital construction would be completed by March 1967.

By late January, however, with the hospital appearing to be 60-70 percent finished, an actual completion date seemed hazy. Then the wheels fell off the whole project.

The money ran out before the job was done. Without a finished hospital, the PGHA lacked the means to repay the $350,000 SBA loan. The SBA refused to lend additional money to an organization that couldn’t pay its bills.

Work stopped. A contingent of Kenai and Nikiski residents resurrected discussions about creating their own hospital. SBA representatives began talking about foreclosing on the hospital property.

It was time for local government to get involved.

Cheechako News photo
Alaska Gov. William A. Egan (far left) helps to lay the cornerstone for the new hospital in a September 1966 ceremony. Also pictured (L-R) are Dr. Paul Isaak, architect Linn Forrest and general contractor Robert Clay.

Cheechako News photo Alaska Gov. William A. Egan (far left) helps to lay the cornerstone for the new hospital in a September 1966 ceremony. Also pictured (L-R) are Dr. Paul Isaak, architect Linn Forrest and general contractor Robert Clay.

Cheechako News file photo from KPC’s Kenai Peninsula Historical Photo Repository
Posing in front of a D8 Caterpillar at the March 1966 groundbreaking for the new hospital are (L-R) grocer Bob Wilson, entrepreneur Clarence Goodrich, grocer Doyle Jowers, entrepreneur Burton Carver, homesteader Jack Farnsworth and Dr. Paul Isaak.

Cheechako News file photo from KPC’s Kenai Peninsula Historical Photo Repository Posing in front of a D8 Caterpillar at the March 1966 groundbreaking for the new hospital are (L-R) grocer Bob Wilson, entrepreneur Clarence Goodrich, grocer Doyle Jowers, entrepreneur Burton Carver, homesteader Jack Farnsworth and Dr. Paul Isaak.

This can of dirt from the shovel of Alaska Gov. William A. Egan is a souvenir from the ceremonial groundbreaking for the hospital in Soldotna in September 1965. The label for the can, which is on display at Peninsula General Hospital, was designed by someone with the last name of Tautfest. (Photo provided by Peninsula General Hospital)

This can of dirt from the shovel of Alaska Gov. William A. Egan is a souvenir from the ceremonial groundbreaking for the hospital in Soldotna in September 1965. The label for the can, which is on display at Peninsula General Hospital, was designed by someone with the last name of Tautfest. (Photo provided by Peninsula General Hospital)

After construction finally began on the hospital, funds were still in short supply, so the Hospital Operating Corporation began selling shares. This 1967 certificate for 10 shares belonged to Dr. Paul Isaak. (Photo provided by Peninsula General Hospital)

After construction finally began on the hospital, funds were still in short supply, so the Hospital Operating Corporation began selling shares. This 1967 certificate for 10 shares belonged to Dr. Paul Isaak. (Photo provided by Peninsula General Hospital)

Work on the roof of the new hospital continues during the winter of 1966-67. At this point, the structure is little more than an empty shell built of concrete blocks. (Cheechako News file photo from KPC’s Kenai Peninsula Historical Photo Repository)

Work on the roof of the new hospital continues during the winter of 1966-67. At this point, the structure is little more than an empty shell built of concrete blocks. (Cheechako News file photo from KPC’s Kenai Peninsula Historical Photo Repository)

Joe Faa, who in 1965 sold 10 acres of his Soldotna homestead as a construction site for a new hospital, poses here in about 1961 with his prize horse Danny. Faa’s horse corral and hay fields are the reason for the name Corral Street in Soldotna. (Cheechako News file photo from KPC’s Kenai Peninsula Historical Photo Repository)

Joe Faa, who in 1965 sold 10 acres of his Soldotna homestead as a construction site for a new hospital, poses here in about 1961 with his prize horse Danny. Faa’s horse corral and hay fields are the reason for the name Corral Street in Soldotna. (Cheechako News file photo from KPC’s Kenai Peninsula Historical Photo Repository)

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