By Bill Barrow, The Times-Picayune, April 16, 2010, 12:05PM

Children's Hospital and Louisiana State University are in talks over an agreement that would allow the Uptown medical facility to expand into the shuttered New Orleans Adolescent Hospital campus.

Children's spokesman Chris Price said the talks have progressed enough for Children's to discontinue its pursuit of 5.5 acres next to Audubon Park, a plan that has sparked considerable resistance from residents of the area.

None of the officials involved have disclosed potential terms that might be on the table.

State Health Secretary Alan Levine said last week that a lease or sale to Children's would be an ideal use of the NOAH property, which the state closed last year as it shifted inpatient mental health beds to a state hospital in Mandeville.

"Our primary interest is to ensure we leave all options on the table so LSU and Children's can negotiate an agreement that allows Children's Hospital the ability to develop a long-term solution for their need for expansion," he said. "We want to allow them the ability to acquire, in whatever form, the property they need to have a sustainable growth strategy."

Such a deal would satisfy the terms of Rep. Neil Abramson's House Bill 1150, which has passed the Louisiana House of Representatives and awaits action in the Senate. Abramson, the New Orleans Democrat who fought the Jindal administration's closure of the Adolescent Hospital last year, wants to allow the state to lease or sell the property but only on the condition that it remain a health care or health education facility.

The state acquired the property through a Dec. 16, 1981 transfer agreement from the federal government. That deal specified that the property would be used for "general health care" services for 30 years, a period that expires in December 2011.

Before Katrina, the property primarily housed inpatient care for children and adolescents suffering from mental illness. After the storm devastated the city's mental health care infrastructure, the state used some beds for adults and added outpatient functions.

Expanded article from April 17, 2010

Children's Hospital and Louisiana State University are in talks about an agreement that would allow the 55-year-old Uptown medical facility to expand into the shuttered New Orleans Adolescent Hospital campus that the LSU System controls.

Children's Vice President for Marketing Brian Landry said the talks have progressed enough for Children's to discontinue its pursuit of land on the edge of Audubon Park, a plan that has sparked resistance from residents who live nearby.

"Children's Hospital needs to expand services, and the former NOAH property is currently our most viable option for expansion," Landry said, though he did not rule out revisiting the idea of securing land now owned by the Audubon Commission.

None of the officials involved has disclosed any potential terms in a deal that could involve a lease or sale of some or all of NOAH's State Street campus. "We are still in early discussions," Landry said, declining to speculate on when a deal will be reached or what it might involve.

In January, when Children's officials appeared at an Audubon Commission hearing, Landry said Children's hoped to launch new construction by the end of 2010.

Ray Lamonica, general counsel for the LSU System, did not respond to questions about the negotiations.

State Health Secretary Alan Levine repeated his position that a lease or sale to Children's would be an ideal use of the NOAH property, which the state closed last year as it shifted inpatient mental health beds to a state hospital in Mandeville and outpatient services to clinics elsewhere in the city.

Levine said he and other Department of Health and Hospitals officials have met "several times" with LSU and Children's executives. "I commend them for working hard toward a solution that gives Children's the opportunity to plan for its growth and LSU the opportunity to meet its needs and benefit the community by providing an outlet for expansion of Children's other than Audubon."

About 100 Uptown residents blasted Children's and Audubon Commission officials at the January hearing as they discussed Children's proposal to lease 5.5 acres that is now home to Audubon's tennis courts and Avenger Field, a former New Orleans Recreation Department playground. The site, which was not part of the original Audubon Park, is still zoned for medical services, but local property owners decried the possibility of new construction and increased traffic.

A Children's-LSU deal would satisfy the terms of Rep. Neil Abramson's House Bill 1150, which has passed the Louisiana House of Representatives and awaits action in the Senate. Abramson, the New Orleans Democrat who fought the Jindal administration's closure of the Adolescent Hospital last year, wants to let the state lease or sell the property, but only on the condition that it remain a health care or health education facility.

The state acquired the property through a Dec. 16, 1981, transfer agreement from the federal government. That deal specified that the property would be used for "general health care" services for 30 years, a period that expires in December 2011.

Before Katrina, NOAH primarily provided inpatient care for children and adolescents suffering from mental illness. After the storm devastated the city's mental health care infrastructure, the state used some beds for adults and added outpatient functions.

Landry said it is too early to speculate whether Children's, now a 175-bed complex, would use NOAH buildings, renovate them or build new structures. "How we might expand on the property is going to be determined by the details in the final purchase or lease agreement, and how much of the land and buildings we acquire," he said.

Initial plans for the Audubon site called for two buildings of two or three stories and a 160-space parking lot, with later plans for a two taller buildings and a parking deck and pedestrian bridges connecting the parcel to the current hospital across Calhoun Street.

Bill Barrow can be reached at bbarrow@timespicayune.com or 225.892.1716.