Brief reprieve

BUFFALO – The U.S. Bankruptcy Court in Buffalo took action Monday, which will allow Lake Shore Hospital to remain open for a while longer.

Lake Shore’s Chapter 11 bankruptcy filing is being handled by Chief Justice Carl L. Bucki. Although there were no previously reported motions to be filed Monday on the court’s website, state Senator Catharine Young explained it allowed the hospital to use cash from receivables in order to stay open.

“They are going to use money owed to the hospital and then they are going to follow up on Jan. 22 to consider the $1 million in state assistance,” Young said in a phone interview Monday evening.

According to the court’s website,, two motions have been filed for that date: First, to prohibit cash collateral/obtain credit under Section 364, and to assume a lease or excutory contract. Section 364(a) authorizes the debtor to obtain unsecured credit and to incur unsecured debt in the ordinary course of business.

Young said the court’s action Monday is another positive step in the process to hopefully keeping Lake Shore open.

“It is just continuing legal procedure. It gives us time for a qualified buyer to get involved – that is what we are really hoping will happen,” she added.

It is expected this will allow the hospital to remain open for another month.

LERHSNY announced the possible closure of the hospital in October due to an estimated deficit of $9 million in 2013. At the time, the closure date was tentatively set on Jan. 31. Neither this date nor any other has reportedly been approved by the state Health Department. The announcement of $1 million in emergency funds came from Young at the rally to save the hospital on Jan. 11.

The U.S. Bankruptcy Court’s Buffalo Office was contacted but did not reply for a comment on the proceedings Monday.