BATON ROUGE - Governor Kathleen Babineaux Blanco today announceced further plans with Louisiana State University to move forward on the LSU-VA hospital in New Orleans.

"We are determined to advance this project to serve critical health care needs in the New Orleans region," Governor Blanco said. "This state of the art teaching and research facility will play a significant role in our efforts to redesign Louisiana's health care system. This hospital is considered a vital part of our state's recovery."

Gov. Blanco led a series of meetings with leaders of LSU, the state Legislature, and members of Louisiana's Congressional delegation to keep the hospital plans on track. As a result, the chairman of the Joint Legislative Committee on the Budget has agreed to the Governor's request for a special meeting March 2 to reconsider the Louisiana Recovery Authority's hospital action plan. The Louisiana Legislature will then have another opportunity to approve a two-part resolution to allocate $74 million in Community Development Block Grant dollars toward land acquisition and planning for the hospital, with the balance of $226 million in CDBG funds to follow subject to receipt of a viable LSU hospital business plan.

"A cutting-edge teaching and research hospital will anchor New Orleans' medical and biosciences research district and will prove critical to the region's recovery," said John T. Landry, Chairman of the LRA Infrastructure Task Force. "We look forward to r! eviewing LSU's business plan when it is completed."

"LSU has always been willing and even eager to participate in healthcare re-design, but we must be assured that our educational mission is preserved as well as our commitment to providing health care for Louisiana citizens who have no health insurance coverage," said Dr. William L. Jenkins, President of the LSU System. "We need to ensure that we have a university teaching hospital where we can train Louisiana s future health care professionals. Ultimately, the state administration and our legislative policy makers must decide how health care is funded and delivered. LSU supports that process."