Vashon Community Care is launching its largest fundraising effort since it built its facility more than a decade ago, a drive that, if successful, will enable it to refinance its mortgage and secure much-needed financial stability.

The center has never been flush with cash, but recent years have been particularly difficult for the small facility because of the ailing economy, increased costs, decreased government reimbursement rates — and a considerable mortgage payment each month. This fall for the first time since it opened in August of 2002, VCC may be able to refinance, exchanging the 7.65 percent loan it has been locked into since it opened a decade ago for one at 3.5 percent or lower, according to Lynn Davison, president of VCC’s board.

This move would bring down its $55,700, per month mortgage payment by some $20,000 and save $9.6 million over the course of the loan.

“That’s a pretty good return on investment,” Davison said. “This will set us in a place where we have a mortgage payment we carry for the next 40 years.”

To refinance, however, VCC must raise money to cover fees associated with refinancing and pay down $285,000 in debt. In all, to achieve its goal, it must raise $350,000 by the end of 2012, in addition to the $150,000 it has raised this year so far. Typically, Davison said, VCC raises $250,000 each year and is aiming is to double its revenue generation this year.

“We do not expect to have to do this again,” she noted.

The VCC board and administrators began the first steps of the refinancing process in the spring, Davison said. In addition to fundraising, some other hurdles need to be cleared before refinancing is a certainty. But just last week, VCC Administrator Janelle Ansell noted she received “momentous” news about the underwriting process, which they are in the midst of, and early indications have been favorable.

“We are optimistic. Our lender is optimistic,” Davison said.

The U.S. Department of Housing and Urban Development (HUD), which backed the current loan, must agree to back the loan again, Davison noted, which she expects it will do.

“We’re the kind of organization they do this for,” she said. “But the deal isn’t done until the deal is done.”

On Vashon, VCC is the largest provider of services to seniors, with assisted living apartments, a skilled nursing facility, adult day services, respite services and, as of recently, rehabilitation services, including occupational, physical and speech therapy. It is an independent nonprofit organization, which is unusual and means, in part, that VCC does not have a “parent organization with deep pockets,” Ansell said.

VCC has made several spending cuts in recent years and is already operating on an extremely lean budget, Davision said. But even with the hope of more funds on the horizon, the organization expects to make additional cuts soon.

While many long-term care facilities do not accept people who pay with Medicaid, the government subsidized health insurance for people of limited financial means, a central tenet at VCC is that it be accessible to anyone who needs it. In 2011, on average, 68 percent of the residents in the skilled nursing facility were on Medicaid, which pays just 79 percent of the cost of care. In the assisted living facility, last year roughly one-third of the residents were on Medicaid, which pays only 60 percent of the cost of care there, according to Ansell.

Still, both Davison and Ansell stressed there has been no discussion about changing the Medicaid policy.

“That would be a disservice to the people of the Island,” Ansell said.

Furthering the financial challenges at VCC is its small number of residents, Ansell added. No matter the size of nursing home, Davison said, there are certain elements of the infrastructure that need to be in place, in part because of government regulations. On Vashon, there are a smaller number of residents to help carry those costs. And in larger centers that have facilities for independent living, assisted living, skilled nursing and memory care, they “feed into themselves more,” Ansell said.

Expanding VCC is not the answer, Davison said. “We’re the right size for Vashon.”

VCC will continue to attempt to expand its services, however, in ways that generate revenue and serve the population of Vashon as people age here, both at VCC and in the wider community as a whole, both women noted.

Meanwhile, Davison said, the board will commit itself to raising funds for the refinancing opportunity. On Oct. 17, it will host its largest annual fundraiser, Uncork the Love, which is an evening of entertainment and dinner at The Hardware Store Restaurant, given over entirely to the event. Tickets are $500 a piece, and through donations, ticket proceeds and sponsorship, Davision said the goal this year is to raise $75,000. VCC recently benefitted from a variety of fundraising events, including a fiber arts trunk show that brought in nearly $5,000, its annual garage sale, the Telling Stories speaker series with John Moore and a night of music at the Red Bike with blues legend Mark DuFresne.

This week, every Island residence will receive VCC’s newsletter, which includes information on the refinancing opportunity and a request for donations. Board members will also do “personal asks,” Davison said, looking for both larger and smaller gifts.

“Our goal is to have as many donors as possible,” she said. “The broader the base, the happier we are.”

Board and staff at VCC are aware that many organizations on the Island are seeking financial support for important work and that competition for financial support is high right now.

“It’s a challenging time,” Davison said. “But this is a wonderful and unique and opportunity.”

If they don’t raise enough money, Davison said, the staff and board will stay the course, continue doing the work they do and continue fundraising.

“If we don’t refinance, we will limp along until we can,” she said.

But further cuts would be needed, she said, action no one wants to take and one that would be challenging to implement and still maintain the vision for the facility and the kind of care people receive there.

The soonest VCC could close on its refinance is the end of October, Davison said, if sufficient funds would come in that quickly and all the procedural matters are taken care of. While the goal is the end of the year, the sooner the better, Davison said, so that VCC can apply the money it is spending on its mortgage debt to caring for residents and building a financial reserve.

“The board is committed to making this happen,” she said.