May Sauder was as surprised as anyone to hear that Oak Bay Lodge will shut down. Howard Waldner, the Vancouver Island Health Authority's CEO, announced on Tuesday that Oak Bay Lodge and Mount Tolmie Hospital will be closed within four years and replaced with a public-private facility. But Sauder, Oak Bay Lodge's administrator, said the good news is that it means staff and residents will get to move into a modern building in four years.

The announcement was just one of many made by VIHA, which is struggling to deal with a $45 million budget shortfall.

Although an extra $95 million in provincial funding was given to VIHA toward its $1.7 billion budget, it wasn't enough to staunch the financial bleeding.

Waldner said a request for proposal would be issued within a month for a company to design, build and operate a new facility that would absorb both Oak Bay Lodge and Mount Tolmie Hospital.

Oak Bay Lodge was originally built as a high-end retirement hotel 40 years ago. It was taken over by the provincial government as a care home in the mid-1970s. But the building isn't wheelchair-friendly, there are no private rooms or overhead lift gear, Sauder said.

"The building would need a major, major upgrade to bring it up to standards and right now one has to be very creative to stay safe," Sauder said.

Although health sector public-private partnerships have been criticized, Waldner was confident the new facility will follow the standard set by other P3s.

"It is an opportunity to replace those facilities sooner than we would otherwise be able to," he said.

Waldner emphasized that with limited capital funding available adjustments have to be made.

"What we're seeing is a demand for services that is outstripping our ability to fund," he said, citing an increasingly aging population exerting more pressure on services.

In addition, to the Oak Bay Lodge re-build, Waldner announced a suite of cuts, that includes care home closures, service cuts, layoffs and land sell-offs.

In Saanich, 10 adult inpatient psychiatric beds will be eliminated from the Eric Martin Pavilion. A 26-bed geriatric assessment unit at Victoria General Hospital will also be closed.

Craigdarroch Care Home, an 18-bed long-term care facility in Victoria, will be shut within a year.

The number of MRIs available will be down to 19,000 from the 22,000 performed last year.

Six adult addictions counsellor positions will be eliminated. All told, about 185 union and non-union staff will lose their jobs, but will be offered positions elsewhere in the system, said chief operating officer Catherine MacKay.

Six crisis lines up and down the Island will be replaced by one. A James Bay community nurse position will be eliminated. As well, drop-in therapeutic art and music programs will be dropped in Sidney and Victoria. Also in Greater Victoria, Meals on Wheels will now be $6 per meal. Previously, the service was free.

As well as selling off properties in Cumberland and Tahsis to drum up cash, the health authority will sell a piece of property adjacent to Victoria General Hospital on Watkiss Way.

Health authority executives expect balanced budgets to be a challenge over the next three years as a 23 per cent increase is expected in expenditures.

"The impacts will be real," Waldner said.

vmoreau@saanichnews.com

Oak Bay Lodge by the numbers:

# of complex care beds: 245

# of respite beds: 2

# of individual living suites: 37

# of day care adults: 200

# of staff: 300