The Civic League of East Jefferson

The Civic League of East Jefferson

Post Office Box 7471

Metairie, LA 70010-7471

July 8, 2013

Councilman Chris Roberts Chairman, Jefferson Parish Council Joseph S. Yenni Building

1221 Elmwood Park Boulevard, 10th Floor Jefferson, Louisiana 70123-2337

Dear Councilman Roberts:

Negotiations with private health care providers are ongoing for the transfer of the operation and management of two of the Parish’s most valuable individual assets, West Jefferson Medical Center and East Jefferson General Hospital. Both of these facilities were established by a vote of the people of Jefferson Parish and funded initially with tax revenues approved by the voters. Several years ago, both public hospitals had in excess of one hundred million dollars in reserves and projected a bright future to the citizens of this parish. At that time, when some residents became concerned about the possibility of changes to the operation of the hospitals, both a state law and parish ordinance were enacted to prohibit any sale or lease of the hospitals without a vote of the public.

Recently, the citizens of Jefferson Parish have been provided with limited information concerning the financial condition and profitability of their public hospitals. This lack of information has been facilitated by the state law, which allows certain public hospital business to be discussed behind closed doors. Other than the hospitals’ public acknowledgement of increased competition, there has been no official public disclosure, until recently, of their drastic depletion of their cash reserves and the urgent need to dispose, through a lease, of the hospital operation and management before the end of this year.

The Civic League of East Jefferson believes that any undertaking of this magnitude should be done with the utmost of openness and transparency. On May 13th the Civic League presented a public forum on the hospital lease referendum issue with Sheriff Newell Normand and Dr. Mark Peters as presenters. Even after our forum, the Civic League remains concerned and guarded about the process being employed. The Civic League is committed to the operation of first class health care facilities in the East and West Jefferson hospital facilities. Unfortunately the Civic League is unable to support the removal of the referendum requirement from the ordinance, at this time, due to the lack of transparency, in the process up to this point. Attached to this letter is a listing of questions and concerns raised at the public forum.

We, the people who are served by these hospitals, do not know who initiated the lease negotiating process nor do we know when it began. Initially, a few months ago, we were told in a broad statement by the hospital board members and administrators that the financial condition of the hospitals is dire and that secret negotiations were already underway to lease the Parish hospitals for up to thirty years. We were told that we could not know the identities of the “bidders” because it would jeopardize the negotiations. The bidder identities have since been revealed in the press, and the impact of this disclosure is unknown to us.

Hospital officials have said we should not be allowed to vote on the proposed lease because lease opponents might publicize information damaging to the hospitals’ image and/or we voters may simply become too confused to make the proper decision in favor of the lease. A unanimous Jefferson Parish Council and hospital officials jointly supported the passage of a bill introduced in the recent legislative session by Representative Joe Lopinto, to amend the state law in order to allow the Jefferson Parish Council to lease the hospitals without a public vote. By all outward appearances, the Council and hospital officials are working together to negotiate what they opine to be a satisfactory lease.

These public hospitals that are owned by the citizens of Jefferson Parish constitute a significant part of this community and their future successful existence will have a major impact on our overall quality of life for many years to come. With such things as jobs, property values, taxes, healthcare, and the financial condition of Jefferson Parish at risk, it is crucial that our public officials make the correct decision. If the Parish Council allowed the voters to decide, we presume the proponent public officials would surely give us all of the details necessary to make up our own minds. However, that does not appear to be the plan, so we citizen-owners of the parish hospitals are now compelled to pursue our own due diligence.

It is our need to be diligent and we believe, in the public interest of the citizens of this parish, that we hereby request our public officials participating in this lease negotiation to disclose basic essential information required for us to arrive at some degree of confidence concerning this entire process.

There remains in effect the Jefferson Parish ordinance prohibiting the lease of a parish hospital without a public vote. It is our understanding that the Jefferson Parish Council will consider amending or repealing this ordinance after the July 10th Public Hearing on the issue. We respectfully request that the Jefferson Parish Council defer any vote that would eliminate the referendum requirement presently required by parish ordinance. The Council should not take any legislative action that would permit the lease of the parish hospitals without a public vote until the citizens of Jefferson Parish are provided with responses to the listed questions/concerns.

Sincerely,

Ralph Brandt, President

Civic League of East Jefferson

cc: President John Young Councilman Ben Zahn, Vice- Chairman

Councilman Elton Lagasse, Councilman at large Division B Councilman Ricky Templet, District 1 Councilman Paul Johnston, District 2 Councilman Mark Spears, District 3 Councilwoman Cynthia Lee Sheng, District 5

QUESTIONS/CONCERNS RAISED AT CIVIC LEAGUE FORUM

1. When was the decision made to begin this lease process? Who made it?

2. Was the decision made with the assistance of an outside consultant(s)? If so, who?

3. Who are the individuals representing the parish in these negotiations?

4. Who are the consultants, attorneys, and accountants assisting in these negotiations?

5. Reserves have been dwindling for several years. Why wasn’t the decision made sooner?

6. What criteria will be the basis for selection of the lessee? Who set the criteria?

7. Who decided that the term of the lease should be 30 years? What happens after 30 years? Is there a lease extension? How are we protected at the end of the lease?

8. Will the hospital districts continue to exist? If so, why?

9. Will the hospital boards be necessary to exist? If so, why? Can board be downsized?

10. Will the same board members continue to serve? If so, why?

11. If the hospital districts continue to exist, will there be administrators, accountants, attorneys, and/or other professional service contractors? If so, why?

12. If the hospital districts continue to exist, what are the projected revenues and expenses? Please explain.

13. Is it possible to dissolve the hospital districts, eliminate the hospital boards, and administer the lease directly with Jefferson Parish?

14. Mention was made of a lump sum payment at the execution of the lease. What will be done with the initial lump sum payments?

15. How will patient care change if there is a lease? Will the lease maintain the present standard of care?

16. What is the policy concerning possible conflicts of interest of those people involved in these negotiations? Will there be appropriate prohibitions and assurances to the effect that no person or firm involved in the negotiations, including any board members, can benefit from the lease transaction?

17. Will the Parish Council and/or the hospital boards and/or the Parish President request the Inspector General of Jefferson Parish to:

a) review the lease negotiation process and to render an IG opinion concerning the efficacy of the process? If no, why not?

b) review the policy concerning possible conflicts of interest and, if such a policy does not exist or is adjudged inadequate, to establish a policy to be applicable to the public officials, negotiators, board members, administrators, and others involved in the negotiations? If no, why not?

c) review and approve the final documentation, including the actual lease agreement? If no, why not?

d) participate in or play any role whatsoever in the lease negotiations? If no, why not?