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May 2, 2013

Board votes to create Manor seller

By Joe Mahoney
The Daily Star

---- — MIDDLEFIELD — Otsego County lawmakers gave overwhelming approval Wednesday to the creation of a local development company that will handle and control the marketing and sale of the deficit-ridden Otsego Manor nursing home.

The vote effectively removes the fate of the Manor from the 14-member Board of Representatives.

Meeting at the same building that had once served as the county’s public nursing home, the Meadows, the Board of Representatives voted 11-3 to approve the creation of the LDC, which will be known as the Otsego County Health Facilities Corporation.

The organization will legally be set up as a nonprofit corporation within the the parameters of Section 501(c) (3) of the Internal Revenue Code.

Its first three officers will be a lawyer who has recommended that the LDC be created, Shawn Griffin of the law firm of Harris Beach, along with Rep. Katherine Stuligross, D-Oneonta, and Rep. Donald Lindberg, R-Worcester. Griffin said he will be an officer only for the initial meeting of the LDC, when its board members will be appointed.

Board of Representatives Chairwoman Kathleen Clark, R-Otego, said she will be appointing people with specialized expertise — such as a banker, a gerontologist, businesspeople and those who support the goal of having quality care provided to patients by a private operator.

“We have to put together a board who realizes and accepts what the mission is, and what it is not,” said Clark.

One person under consideration for a spot on the LDC is James Empie, an executive at Key Bank in Cooperstown.

Voting against the LDC were Keith McCarty, R-Springfield, Rep. Gary Koutnik, D-Oneonta and Rep. John Kosmer, D-Fly Creek. McCarty has been opposed to the sale of the Manor since the proposal first surfaced last year. Kosmer and Koutnik argued that board should stay in control of the Manor at least until the LDC comes up with a recommendation on a potential bidder.

By some accounts, a private buyer could be selected by the LDC as early as the end of this year. Once negotiations have concluded with the private buyer, the state Department of Health would have 60 days to determine if the buyer should be awarded a state certificate to operate the home.

The union for county workers, the Civil Service Employees Association, has signaled that it is likely to sue the Board of Representatives, challenging the legality of declaring the nursing home to be surplus property.

Just prior to the vote that created the LDC, Koutnik proposed an amendment that would have allowed the corporation to be set up but would have kept the Manor under the county’s control until the LDC board was ready to recommend a a buyer.

“We would only vote to transfer if we were OK with the buyer,” explained Koutnik, who acknowledged that injecting that caveat into the process could stretch out the amount of time needed to sell the Manor.

But his suggested amendment generated only two votes in favor of it — from Koutnik and Kosmer — after Griffin argued that potential buyers would likely stay on the sidelines once they became aware that the facility’s fate was entangled in the internal politics of the county board.

Koutnik had said that board members had been elected to make tough decisions, and they were effectively handing over that responsibility to another party by setting up the LDC

While advocates for keeping the Manor as a county property criticized the representatives for not negotiating a new wage package with county workers, Griffin said the county would continue to lose millions of dollars each year until the home is sold.

“If they (Manor employees) gave up their entire base pay and worked for free, you’d still be losing money,” the lawyer said. Griffin also said the Manor should be “sold as fast as possible,” to avert a precipitous decline in patient population.

Rep. Pauline Koren, R-Milford, agreed with Griffin that it would be best to allow the LDC handle the sale, saying the corporation’s officers “aren’t going to put everything into it” if they know their decision could be second-guessed by the Board of Representatives.

Rep. Catherine Rothenberger, D-Oneonta, said while she was on the board when it decided to build the Manor, she has concluded privatizing the Manor is the best option for the county.

“We cannot financially support this any more,” she said, adding later: “We built a Cadillac.”

Stuligross credited Lindberg for being the first to warn of the dire financial straits enveloping the Manor and taxing the resources of the county.

“We didn’t want to listen to him,” she admitted, noting that further investigation into the rising county subsidy to the nursing home proved that Lindberg’s statements were backed up by the financial sheets.

Before the resolution to create the LDC came before the board, a CSEA staffer, Karen Carpenter, said the board’s decision to sell the Manor through an LDC was made “purely for selfish reasons,” adding that the representatives “should be determining who is the most responsible bidder in public.”

“You don’t want to be responsible for the decision that gets made, and you don’t want to listen to the public’s disapproval any more,” she said.

Several members of the public, among them Sandra Bliss of Middlefield and Keith Schue of Cherry Valley, also decried the LDC plan, as did Anthony Effen, a Manor transportation worker.

The lone member of the public who spoke in support of the LDC option, William Dornburgh of Cooperstown, said he believed that the board members had weighed alternatives to privatizing the Manor.

“I’d like to commend the board for doing due diligence,” said Dornburgh, noting his wife is a Manor patient. “I think you have done a fair investigation of the alternatives. I’m not sure about your negotiations with the union. However, as a minority of one, I stands to commend you.”

“Moral values — where did they go?” asked Effen, claiming that the board was dooming patients to a reduced level of care.

CSEA had stepped up its argument in recent days that the board should have initiated contract talks with the bargaining unit before crating the LDC.

After the meeting, Kosmer predicted that nettlesome choices could lie ahead for the officers of the LDC, whose tasks will include balancing looking out for the county’s interests at the same time they strive to find an operator who won’t skimp on patient care.

“What if you get a stellar health care provider and they offer you $ 8 million and you get a good health care provider who offers you $14 million?” he asked. “That’s not going to be our battle. That’s going to be the LDC’s battle.”