The Arlington County Board will hold a public hearing July 29 on a proposed law that would create a seven-member industrial authority for the purpose of financing and refinancing tax-exempt acute care hospitals, medical facilities for the terminally ill and nursing homes located in Arlington.

The immediate purpose of the proposed law, say county officials, would be to obtain the ability to refinance Arlington Hospital, which built a new wing five years ago, at preferred interest rates. The tax exempt status of the authority would allow a potential investor to avoid paying federal taxes on interest from authority bonds.

Officials also note that, if approved, the industrial authority could be used to finance a proposed hospice for terminally ill patients which may open next year at Woodlawn School.

"There is considerable urgency," Dr. Kenneth Haggerty, chairman of the board of Arlington Hospital, told the board at its meeting last week. "You know what's happening to interest rates."

Payment of the debt would come from the hospital revenue, not from county funds. Should the hospital default, the county would not be responsible for assuming the debt.

"It's a big deal to create one of these authorities," said board member Joseph S. Wholey, "because it can issue tax-exempt bonds."

County manager W. Vernon Ford noted before the meeting that an industrial authority could sell revenue bonds to be repaid from fees for the use of a hospice. "This may be a mechanism for them to get financing," Ford said. "They have no debt. There's a market for the hospice concept and people will pay for the service, so there's a way to pay off the debt."

Ford noted that Arlington's authority will be more limited than that of Fairfax County, which is trying to lure large industries and sell industrial sites. "I think we're not ready for that," Ford said. "We haven't got an industry. Arlington in its current state of development isn't a home for manufacturing. We have nobody who wants to put a widget factory in Arlington."