11/7/11 Board Meeting – Preliminary

1.  The Closed Session agenda has a trade secrets item that does not meet Brown Act disclosure requirements.  I hate the fact that I am associated with a Board that does not have a sufficient commitment to transparency.  Of course the vote is 4 to 1 against changing anything.  Mr. Driscoll, the District’s counsel stands firmly behind his interpretation of the law (against fuller disclosure) even though the Brown Act if fairly explicit about the form that closed session agendas should take and most interpretations of the law I have read suggest placeholder type of language is inappropriate.  Of course, from a practical point of view, Mr. Driscoll is right because there is little to no downside to this type of violation.

2.  September financial reports.  It would seem that based on Debi Stebbins statements on 11/2 that the District would have a loss for the first quarter.  She estimated the decision by the State to withdraw the sub-acute rate changes to be worth about 1.5 million annually.  I’m not sure why, but the impact is much greater than that; it appears the positive is to the tune of about 2.4 million annually (about 200k per month).  This is surprising since the 1.5 million came straight from Stebbins and, I think, the budget for this year stated 2.1 million total including the SNF rate changes and those were approved.  Not sure why the large discrepancy but, in this case, not a case of her being overly optimistic.  By rights, given the huge swing to the positive, the District should be swimming in net income.  Unfortunately, the IGT numbers had to be adjusted the other direction so that the YTD loss will be reported as 272k.  If you would like to keep FY11 stuff in FY11 and FY12 in FY12 then the YTD is the original -585k + 617k for sub-acute – 121k for IGT or at YTD loss for just FY12 numbers of 89k.  That is obviously considerably better than previous and suggests that District has a chance of not having a miserable year.  It’s only 284k below budget.  Certainly,holding losses to below 100k and missing budget by more than a quarter of a million dollars represents a stellar performance on the part of CEO Stebbins.  She is to be complimented.

3.  Modification of Bank of Alameda loans.  I thought we had done this already, but the Board needs to approve the changes to the agreements that are necessitated by poor financial performance.  Bank of Alameda is more than willing to accommodate since the District is pretty much legally obligated to make good on these debts.  This minimization/elimination of risk is one reason that Chris Zimmerman is so eager to lease to the District.  He really does not have to worry about the District ever going bankrupt.  It is unfortunate for the citizens of Alameda because their liability just keeps on piling up due to mismanagement.  Stebbins is very comfortable putting other people’s money at risk.

4.  Waters Edge.  I am sadly thinking it will be approved.  Chris Zimmerman gets a partner and payments totaling over 20,000,000 through the years for a lease rate that is higher than comparables in the Bay Area and for more beds than will actually be occupied.   Debi Stebbins gets a mulligan on her dismal performance.  Alamedans gains not a single SNF bed.  Alamedans take on a huge risk that depends on the Hospital staying open for 20 years despite consistent operational losses, questionable quality of outcomes, and current violation of OSHPD regulations.  All I can really do is witness this since the votes appear to be there.

About egorelick

Gadfly. Former City of Alameda Healthcare District Board member.
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