Lake Shore Hosp Authority: Hospital sale public hearing a bust – Taxpayers may be screwed
County tax payers could be paying for the next 26 years
Posted January 14, 12:51 pm | news/analysis
Authority board members (left to right) Murphy, Douglas, Chancy. Tough questions were not always answered correctly. Lori Chancy was the only Board member opposed to the sale.
Authority Manager Berry. He had a tough time at the meeting.
COLUMBIA COUNTY, FL – Last night, a woefully unprepared Lake Shore Hospital Authority Board and General Manager visited the issue of selling the Shands/Lake Shore Hospital. FL law mandates a public hearing before the sale. Board Chairman and Gov Scott reappointment, Dr. Waseem Khan, followed the Authority practice of allowing no questions. Only one person from the public spoke. By the conclusion of the meeting it appeared that Columbia County's taxpayers will be paying for a long time to come.
Local Attorney Bob Jordan was the only member of the public to comment at the public hearing.
Mr. Jordan told the Authority, "I understand that if you shut this down you may end up saving the taxpayers some tax money... I don't think that's the requirement of the statute. The requirement for selling this hospital is it be in the best interest of the people. I suggest this probably will not be and if it is there certainly is no data or studies to show that." (The statute can be found here).
Mr. Jordan said the Authority now has some control over the hospital.
This is barely true, as the Authority, under the leadership of its then Chairman and present board member, Marc Vann, facilitated a sweetheart lease with the new partnership of Shands and HMA, in which the Authority gave up virtually all control over the hospital in a new net-net lease.
Mr. Jordan told the Authority, "It looks to me like HMA has a very favorable lease. I think before you go out and hire a bunch of experts and consultants you ought to ask HMA the question, '"Are you all interested in buying this?""
Attorney Jordan continued, "You don't have to put out a request for proposals until you are actually about to sell the hospital... What I'm seeing for 2012, there was about $2.7mil paid by this Authority for health care services, presumably to HMA people. They paid $400,000 in rent."
The $2.7mil was public Columbia County money. HMA is a private for profit corporation.
The Authority did not respond to any of Mr. Jordan's remarks.
Did GM Berry keep board members in the loop?
FirstSouthwest's Bruce Kelley mostly addressed the audience during his presentation. He gave the public more respect in 15 minutes than the Authority Board and General Manager give them in a year.
Outside of the public eye and without Board approval, General Manager Berry invited Bruce Kelley of First Southwest Capital to the Authority meeting to give a presentation. It is not clear how much this cost the taxpayers or what Board members had any input into this decision, if any.
Chairman Khan was supposed to approve the agenda. If he did, the presumption is that at least he knew about it.
On Wednesday, January 8th, General Manager Berry received a copy of the presentation from FirstSouthwest's Mr. Kelley via email.
Your reporter requested a copy of the presentation on January 10th and was stonewalled by GM Berry, who did not turn it over. General Manager Berry continues to play fast and loose with Florida's Public Record Laws.
While the Board had a hard copy of Mr. Kelley's presentation at the meeting, it appears that Berry did not email it to the Board members before the meeting.
The Board looked confused as Mr. Kelley gave his presentation.
Approved: bring on the consultants
It is perfectly clear that the Authority cannot sell its hospital without the consent of HMA, which has the right to reassign its lease.
The Authority claims it must approve the takeover of HMA by Community Health Systems (CHS), which is scheduled for the end of the month. Since 1986 the hospital lease has been reassigned many times. It would be difficult for them to make a case against either the takeover or the reassignment.
It is possible that a backroom deal could have been made between the Authority and HMA for the sale of the hospital. If it was, no one is talking.
To facilitate a proposed sale, the Board approved putting out requests for a consultant and hospital appraiser.
If hired, the tens of thousands of dollars of public money that will be spent for the purpose of selling the hospital will be for nothing without the approval of the folks at HMA or CHS.
Long time Authority Attorney Marlin Feagle told the Board, "The lease says we won't unreasonably withhold our consent to the sale."
The Observer has not been able to find that stipulation in any lease regarding the 2010 Authority/Shands/HMA deal.
Some of those involved in the 2010 lease negotiations between the Authority and Shands/HMA are still involved with the Authority, notably: Attorney Marlin Feagle; Authority Account - Financial Advisor – Outside Auditor (all one person) Richard Powell; Rep. Elizabeth Porter's Chief of Staff and Authority Board member Koby Adams, and Board Chairman Waseem Khan; and past Board member and present General Manager, Jackson P. "Jack" Berry. Mr. Adams and Dr. Khan are Gov. Scott reappointments.
The sweetheart lease between the Authority and Shands/Lakeshore (HMA) has 26 years to run.
In 2010, HMA and its successors were guaranteed by the Authority Board members, led by then Board Chairman Marc Vann, an income equivalent to 1.5 mills a year for 30 years. At the present time, whether it is collected by tax revenue or not, Mr. Vann and company have indebted the Authority, and by association the taxpayers of Columbia County to the current amount of $3,500,000 a year.
As the meeting concluded, General Manager Berry claimed that the Authority has 357 people that are taking advantage of the indigent care program financed by Authority. That works out to $9,803.92 per Authority client. This is not a good deal for the taxpayers of Columbia County.
If HMA or CHS doesn't agree to the sale of the Hospital, and it is not clear why either one of them would, it appears that Columbia County's taxpayer's will be paying for a long time to come.