What would you have done, Brian?
Moderator: Jim O'Bryan
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David Anderson
- Posts: 400
- Joined: Mon Jun 05, 2006 12:41 pm
What would you have done, Brian?
Brian -
You and I have gotten to know each other fairly well over the last 18-months and the question above is not intended to be rhetorical or snarky. You've yet to cite one decision of Council regarding this entire matter with which you've agreed and that's okay. I have justified my decisions here and elsewhere and I know you are reading these if not agreeing with them. Again, that's okay and I am not trying to convince you or anyone, for that matter. Just stating my case.
So, I am not looking for the Magna Carta here, but, rather a basic list of what you would have done in 2015. I'm hoping we can have a non dramatized discussion here.
David A.
You and I have gotten to know each other fairly well over the last 18-months and the question above is not intended to be rhetorical or snarky. You've yet to cite one decision of Council regarding this entire matter with which you've agreed and that's okay. I have justified my decisions here and elsewhere and I know you are reading these if not agreeing with them. Again, that's okay and I am not trying to convince you or anyone, for that matter. Just stating my case.
So, I am not looking for the Magna Carta here, but, rather a basic list of what you would have done in 2015. I'm hoping we can have a non dramatized discussion here.
David A.
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Lori Allen _
- Posts: 2550
- Joined: Wed Jan 28, 2015 2:37 pm
Re: What would you have done, Brian?
Mr. Anderson, quit avoiding my questions under the post "Mr. Anderson, Can you please reconcile your statements". Bring the proof, bring the documentation. Without the documentation, your words mean nothing. Just like the people of Lakewood Appear to mean nothing to you. You, along with Summers and Extended Company, allegedly money laundered OUR hospital away, didn't you? If not true, please post documentation here. Thank you.
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Brian Essi
- Posts: 2421
- Joined: Thu May 07, 2015 11:46 am
Re: What would you have done, Brian?
Mr. Anderson,David Anderson wrote:Brian -
You and I have gotten to know each other fairly well over the last 18-months and the question above is not intended to be rhetorical or snarky. You've yet to cite one decision of Council regarding this entire matter with which you've agreed and that's okay. I have justified my decisions here and elsewhere and I know you are reading these if not agreeing with them. Again, that's okay and I am not trying to convince you or anyone, for that matter. Just stating my case.
So, I am not looking for the Magna Carta here, but, rather a basic list of what you would have done in 2015. I'm hoping we can have a non dramatized discussion here.
David A.
I assume your question is what would I have done in 2015 if I was you and on Council?
For me that is easy:
In general, I would have led, not followed. I would have held people accountable, not let them off the hook. To have change, you need accountability, and you can’t have accountability without good leadership
But here are some specifics just off the top of my head that I would have done to have avoided the Pearl Harbor Day first reading and passage of 49-15:
1. Engaged independent Lawyers.
I would have retained independent legal counsel for City Council alone.
(This was Council decision—not a decision for Summers and his law director. I think Senator Skindell advised Council to get its own lawyers—Kevin Butler was in a conflict and should never have been in charge of the due diligence.)
2. Ask Madigan and Bullock to recuse themselves from the entire process—Their minds were made up and they had already voted for it—they voted on December 12, 2013and January 14, 2015 to give CCF its FHC.
3. Remove Madigan as council president—I know that this was discussed and you had the votes—I would have pressed for that harder. Her failure to lead was well documented.
4. Restructure the LHA Board—In 30 years of experience, I have learned that if a company is struggling, you need to change the board. The LHA board was weak and captive of the Clinic due to Summers’ and the board’s failure to understand who they owed their duties of allegiance to—Lakewood—not CCF. The January 14, 2015 LHA was a clear betrayal of those duties. Clean house on the Lakewood end—I publically wrote that on April 13, 2015 and stated that at Council meetings more than once.
5. Engaged an Investment Banker and other experts to value the hospital and value the damages caused by CCF and LHA to this vital city asset. Neither Subsidium nor Huron were engaged to look back at what happened—big mistake. If you don’t know where you’ve been, you really don’t know where you are or where you are capable of going. The Huron and Subsidium reports are toilet paper.
6. Demand that special legal counsel be appointed to review and likely join the taxpayer lawsuit. This would have been excellent leverage in any negotiations with CCF. Summers, Butler and Council failed to use any leverage. Instead, you had Butler negotiating a “deal” with Cosgrove and CCF who Butler was and is defending. Big mistake.
7. In September, 2015, I would have demanded Butler’s resignation. In over 30 years of negotiating deals, I have never seen anyone publically announce that they have no rights or leverage against someone on the eve of announcing they will negotiate exclusively with that party they claim they have no leverage against. Unforgivable and just plain dumb.
8. Assemble a group of experts. As I wrote to you, council and Summers on April 13, 2015, the city would have clearly ended up with more by doing nothing—even though I even gave Jenn Pae (and you) a detailed analysis to that effect on August 7, 2015
9. I could go at greater on later after giving this greater thought—I have written so much on this—Remember my article in the LO “Council needs to act like a landlord?" or something like that. Putting a defaulting tenant in charge of selling your property is a pretty dumb idea.
I need to tend to something for my daughter now, more later.
Do you want me to answer the question posed, if I was Mayor Summers in 2015?
David Anderson has no legitimate answers
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Lori Allen _
- Posts: 2550
- Joined: Wed Jan 28, 2015 2:37 pm
Re: What would you have done, Brian?
Mr. Anderson, you have not answered either of these posts with documentation. Why? Hmmmmm.
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cmager
- Posts: 697
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Re: What would you have done, Brian?
Thank you, Mr. Anderson, for this thread has already become quite enlightening, if not cathartic. Indeed, can you next please ask Mr. Essi to role play Mayor Summers?
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Stan Austin
- Contributor
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Re: What would you have done, Brian?
I see the possibility in this thread for the discussion that should have taken place.
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Dan Alaimo
- Posts: 2140
- Joined: Fri Apr 23, 2010 8:49 am
Re: What would you have done, Brian?
To this I'd add: "last year" or even "years ago."Stan Austin wrote:I see the possibility in this thread for the discussion that should have taken place.
It's a discussion that's long overdue.
“Never let a good crisis go to waste." - Winston Churchill (Quote later appropriated by Rahm Emanuel)
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m buckley
- Posts: 708
- Joined: Mon Sep 15, 2014 12:52 pm
Re: What would you have done, Brian?
Brian Essi wrote:Mr. Anderson,David Anderson wrote:Brian -
You and I have gotten to know each other fairly well over the last 18-months and the question above is not intended to be rhetorical or snarky. You've yet to cite one decision of Council regarding this entire matter with which you've agreed and that's okay. I have justified my decisions here and elsewhere and I know you are reading these if not agreeing with them. Again, that's okay and I am not trying to convince you or anyone, for that matter. Just stating my case.
So, I am not looking for the Magna Carta here, but, rather a basic list of what you would have done in 2015. I'm hoping we can have a non dramatized discussion here.
David A.
I assume your question is what would I have done in 2015 if I was you and on Council?
For me that is easy:
In general, I would have led, not followed. I would have held people accountable, not let them off the hook. To have change, you need accountability, and you can’t have accountability without good leadership
But here are some specifics just off the top of my head that I would have done to have avoided the Pearl Harbor Day first reading and passage of 49-15:
1. Engaged independent Lawyers.
I would have retained independent legal counsel for City Council alone.
(This was Council decision—not a decision for Summers and his law director. I think Senator Skindell advised Council to get its own lawyers—Kevin Butler was in a conflict and should never have been in charge of the due diligence.)
2. Ask Madigan and Bullock to recuse themselves from the entire process—Their minds were made up and they had already voted for it—they voted on December 12, 2013and January 14, 2015 to give CCF its FHC.
3. Remove Madigan as council president—I know that this was discussed and you had the votes—I would have pressed for that harder. Her failure to lead was well documented.
4. Restructure the LHA Board—In 30 years of experience, I have learned that if a company is struggling, you need to change the board. The LHA board was weak and captive of the Clinic due to Summers’ and the board’s failure to understand who they owed their duties of allegiance to—Lakewood—not CCF. The January 14, 2015 LHA was a clear betrayal of those duties. Clean house on the Lakewood end—I publically wrote that on April 13, 2015 and stated that at Council meetings more than once.
5. Engaged an Investment Banker and other experts to value the hospital and value the damages caused by CCF and LHA to this vital city asset. Neither Subsidium nor Huron were engaged to look back at what happened—big mistake. If you don’t know where you’ve been, you really don’t know where you are or where you are capable of going. The Huron and Subsidium reports are toilet paper.
6. Demand that special legal counsel be appointed to review and likely join the taxpayer lawsuit. This would have been excellent leverage in any negotiations with CCF. Summers, Butler and Council failed to use any leverage. Instead, you had Butler negotiating a “deal” with Cosgrove and CCF who Butler was and is defending. Big mistake.
7. In September, 2015, I would have demanded Butler’s resignation. In over 30 years of negotiating deals, I have never seen anyone publically announce that they have no rights or leverage against someone on the eve of announcing they will negotiate exclusively with that party they claim they have no leverage against. Unforgivable and just plain dumb.
8. Assemble a group of experts. As I wrote to you, council and Summers on April 13, 2015, the city would have clearly ended up with more by doing nothing—even though I even gave Jenn Pae (and you) a detailed analysis to that effect on August 7, 2015
9. I could go at greater on later after giving this greater thought—I have written so much on this—Remember my article in the LO “Council needs to act like a landlord?" or something like that. Putting a defaulting tenant in charge of selling your property is a pretty dumb idea.
I need to tend to something for my daughter now, more later.
Do you want me to answer the question posed, if I was Mayor Summers in 2015?
Great response Mr. Essi.
Embarrassing that Mr. Anderson didn't have "the stuff" to act on any of it.
" City Council is a 7-member communications army." Colin McEwen December 10, 2015.
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m buckley
- Posts: 708
- Joined: Mon Sep 15, 2014 12:52 pm
Re: What would you have done, Brian?
Brian Essi wrote:Mr. Anderson,David Anderson wrote:Brian -
You and I have gotten to know each other fairly well over the last 18-months and the question above is not intended to be rhetorical or snarky. You've yet to cite one decision of Council regarding this entire matter with which you've agreed and that's okay. I have justified my decisions here and elsewhere and I know you are reading these if not agreeing with them. Again, that's okay and I am not trying to convince you or anyone, for that matter. Just stating my case.
So, I am not looking for the Magna Carta here, but, rather a basic list of what you would have done in 2015. I'm hoping we can have a non dramatized discussion here.
David A.
I assume your question is what would I have done in 2015 if I was you and on Council?
For me that is easy:
In general, I would have led, not followed. I would have held people accountable, not let them off the hook. To have change, you need accountability, and you can’t have accountability without good leadership
But here are some specifics just off the top of my head that I would have done to have avoided the Pearl Harbor Day first reading and passage of 49-15:
1. Engaged independent Lawyers.
I would have retained independent legal counsel for City Council alone.
(This was Council decision—not a decision for Summers and his law director. I think Senator Skindell advised Council to get its own lawyers—Kevin Butler was in a conflict and should never have been in charge of the due diligence.)
2. Ask Madigan and Bullock to recuse themselves from the entire process—Their minds were made up and they had already voted for it—they voted on December 12, 2013and January 14, 2015 to give CCF its FHC.
3. Remove Madigan as council president—I know that this was discussed and you had the votes—I would have pressed for that harder. Her failure to lead was well documented.
4. Restructure the LHA Board—In 30 years of experience, I have learned that if a company is struggling, you need to change the board. The LHA board was weak and captive of the Clinic due to Summers’ and the board’s failure to understand who they owed their duties of allegiance to—Lakewood—not CCF. The January 14, 2015 LHA was a clear betrayal of those duties. Clean house on the Lakewood end—I publically wrote that on April 13, 2015 and stated that at Council meetings more than once.
5. Engaged an Investment Banker and other experts to value the hospital and value the damages caused by CCF and LHA to this vital city asset. Neither Subsidium nor Huron were engaged to look back at what happened—big mistake. If you don’t know where you’ve been, you really don’t know where you are or where you are capable of going. The Huron and Subsidium reports are toilet paper.
6. Demand that special legal counsel be appointed to review and likely join the taxpayer lawsuit. This would have been excellent leverage in any negotiations with CCF. Summers, Butler and Council failed to use any leverage. Instead, you had Butler negotiating a “deal” with Cosgrove and CCF who Butler was and is defending. Big mistake.
7. In September, 2015, I would have demanded Butler’s resignation. In over 30 years of negotiating deals, I have never seen anyone publically announce that they have no rights or leverage against someone on the eve of announcing they will negotiate exclusively with that party they claim they have no leverage against. Unforgivable and just plain dumb.
8. Assemble a group of experts. As I wrote to you, council and Summers on April 13, 2015, the city would have clearly ended up with more by doing nothing—even though I even gave Jenn Pae (and you) a detailed analysis to that effect on August 7, 2015
9. I could go at greater on later after giving this greater thought—I have written so much on this—Remember my article in the LO “Council needs to act like a landlord?" or something like that. Putting a defaulting tenant in charge of selling your property is a pretty dumb idea.
I need to tend to something for my daughter now, more later.
Do you want me to answer the question posed, if I was Mayor Summers in 2015?
Mr. Essi, I almost forgot. Besides resigning, "What would you have done if you were Mayor Summers in 2015?
" City Council is a 7-member communications army." Colin McEwen December 10, 2015.
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Brian Essi
- Posts: 2421
- Joined: Thu May 07, 2015 11:46 am
Re: What would you have done, Brian?
Dear Councilman Anderson,Brian Essi wrote:Mr. Anderson,David Anderson wrote:Brian -
You and I have gotten to know each other fairly well over the last 18-months and the question above is not intended to be rhetorical or snarky. You've yet to cite one decision of Council regarding this entire matter with which you've agreed and that's okay. I have justified my decisions here and elsewhere and I know you are reading these if not agreeing with them. Again, that's okay and I am not trying to convince you or anyone, for that matter. Just stating my case.
So, I am not looking for the Magna Carta here, but, rather a basic list of what you would have done in 2015. I'm hoping we can have a non dramatized discussion here.
David A.
I assume your question is what would I have done in 2015 if I was you and on Council?
For me that is easy:
In general, I would have led, not followed. I would have held people accountable, not let them off the hook. To have change, you need accountability, and you can’t have accountability without good leadership
But here are some specifics just off the top of my head that I would have done to have avoided the Pearl Harbor Day first reading and passage of 49-15:
1. Engaged independent Lawyers.
I would have retained independent legal counsel for City Council alone.
(This was Council decision—not a decision for Summers and his law director. I think Senator Skindell advised Council to get its own lawyers—Kevin Butler was in a conflict and should never have been in charge of the due diligence.)
2. Ask Madigan and Bullock to recuse themselves from the entire process—Their minds were made up and they had already voted for it—they voted on December 12, 2013and January 14, 2015 to give CCF its FHC.
3. Remove Madigan as council president—I know that this was discussed and you had the votes—I would have pressed for that harder. Her failure to lead was well documented.
4. Restructure the LHA Board—In 30 years of experience, I have learned that if a company is struggling, you need to change the board. The LHA board was weak and captive of the Clinic due to Summers’ and the board’s failure to understand who they owed their duties of allegiance to—Lakewood—not CCF. The January 14, 2015 LHA was a clear betrayal of those duties. Clean house on the Lakewood end—I publically wrote that on April 13, 2015 and stated that at Council meetings more than once.
5. Engaged an Investment Banker and other experts to value the hospital and value the damages caused by CCF and LHA to this vital city asset. Neither Subsidium nor Huron were engaged to look back at what happened—big mistake. If you don’t know where you’ve been, you really don’t know where you are or where you are capable of going. The Huron and Subsidium reports are toilet paper.
6. Demand that special legal counsel be appointed to review and likely join the taxpayer lawsuit. This would have been excellent leverage in any negotiations with CCF. Summers, Butler and Council failed to use any leverage. Instead, you had Butler negotiating a “deal” with Cosgrove and CCF who Butler was and is defending. Big mistake.
7. In September, 2015, I would have demanded Butler’s resignation. In over 30 years of negotiating deals, I have never seen anyone publically announce that they have no rights or leverage against someone on the eve of announcing they will negotiate exclusively with that party they claim they have no leverage against. Unforgivable and just plain dumb.
8. Assemble a group of experts. As I wrote to you, council and Summers on April 13, 2015, the city would have clearly ended up with more by doing nothing—even though I even gave Jenn Pae (and you) a detailed analysis to that effect on August 7, 2015
9. I could go at greater on later after giving this greater thought—I have written so much on this—Remember my article in the LO “Council needs to act like a landlord?" or something like that. Putting a defaulting tenant in charge of selling your property is a pretty dumb idea.
I need to tend to something for my daughter now, more later.
Do you want me to answer the question posed, if I was Mayor Summers in 2015?
I am sorry that I forgot about getting back to you on this post.
I found the article from the Observer I mentioned above: http://lakewoodobserver.com/read/2015/1 ... esponsible
Here is the text of that article which was written the week before I knew of the first reading of 49-15 and printed on December 8, 2015--the day after the first reading.
Mayor Summers and City Council Need to Act Like Responsible Landlords
by Brian Essi
Here is where we are on the hospital situation:
1. The Cleveland Clinic (CCF) is in breach of the Definitive Agreement (DA) and has committed tortious acts that have caused damage to Lakewood’s assets
Lakewood Hospital Association (LHA) is in breach of its Lease with City.
2. LHA trustees, including the 3 City’s ex-officio trustees (Summers, Madigan and Bullock) have breached their fiduciary duties by failing to adhere to the charitable mission of LHA and failing to competently oversee CCF.
3. CCF and LHA want out of their obligations under the Lease and DA.
4. Under the circumstances, the City as the Landlord has both the right and the duty to seek alternative tenants to operate a hospital and/or buyers for its buildings and equipment.
Mayor Summers and City Council have failed to:
a. Demand that LHA and CCF comply with the relevant agreements and restore services and patient volumes taken away by CCF.
b. Seek alternative tenants in a professional manner and failed to conduct any professional or public bidding of its assets, i.e. they have made no effort whatsoever to maximize the value of the assets or advertise the hospital for lease or sale.
7. No rationale Landlord would let the “volunteer” trustees of the defaulting tenant and the defaulting CCF control the search for a new tenant and/or the liquidation and sale of the City’s assets. To make matters worse, the defaulting volunteer trustees are led by Tom Gable who is also a CCF trustee—this just makes no sense.
8. Instead of fulfilling their legal duties, City leaders chose to negotiate exclusively with LHA and CCF—i.e. the parties who caused the problems in the first place.
9. Sources say that the City leaders are close to a deal that is roughly equivalent to the original LOI reached back in January, 2015---a “deal” worth far less than $50 million when the public assets have been valued at $120 million.
In exchange for this “deal" Lakewood will be asked to surrender:
1. Public money and property valued by LHA’s expert at $120 million [We now know it was worth $180 million].
2. The largest employer in Lakewood—about $990,000 in income annual payroll taxes.
3. $7 million per year in charity care for our underserved.
4. Over $ 1 million per year in rent through 2026--$11 million.
5. $5 million in annual capital improvements to the Hospital--$55 million through 2026. [We now know the Clinic was obligated for $278M]
6. Valuable legal rights against CCF that could be worth more than $100 million at settlement.
7. Economic Activity that the hospital impacts estimated at over $250 million annually.
Additional results of the hospital closure “deal” will be as follows:
1. Lakewood businesses will close,
2. jobs will be lost,
3. homes and business properties will be foreclosed,
4. property values will drop,
5. tax revenues will go down,
6. the elderly will suffer,
7. crime will rise,
8. the underserved will be even more underserved,
9. tax increases will be sought, and
10. schools will suffer.
To make matters worse:
1. CCF will be the sole provider of healthcare in Lakewood---they have already shown their lack of respect for Lakewood and the health of its citizens.
2. The people who have caused this calamity and pressed for this "deal”—an insiders’ club----will be in control of a majority the "benefits" flowing from the “deal.” The City gets virtually nothing for its assets valued at $120 [now $180M] million and the loss of its largest employer.
What Should City Leaders Do?
Set Clear Goals:
1. Maximize Value of Assets.
2. Maximize Prospective Jobs, Tax Base and Economic Impact in repurposing, re-leasing or selling the assets.
3. Provide best possible healthcare for citizens, including the underserved in relation to the repurposing, re-leasing or sale of assets.
The Simplest Solution is also the least Risky and provides the Highest Return:
1. Pursue and Explore Third Party Options—Begin a City Council Led Request For Proposal bidding process for a hospital, surgical center and/or FHC/ER. Immediately entertain the Surgical Development Partners’ offer for the Westlake Columbia Road medical facility and engage with them on their vision for acute care hospital and outpatient surgery center in downtown Lakewood..
2. Pursue Claims Against LHA, CCF and LHA Trustees for the breaches.
Acceptance of the “deal” amounts to a self-serving burial of the failures of all of those involved. Any Council member who votes for such a corrupt “deal” will be breaching their own fiduciary duties and exposing City to severe financial losses and legal liabilities that are easily avoidable. They will be joining and supporting CCF's agenda.
David Anderson has no legitimate answers
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David Anderson
- Posts: 400
- Joined: Mon Jun 05, 2006 12:41 pm
Re: What would you have done, Brian?
I appreciate the response, Brian. And, honestly, you and I have spoken and corresponded so many times of the last 18-months that nothing on this list is a surprise to me. Please allow me to take the following one at a time, not as an attempt to convince you but to just give you my take, then I’ll provide more as to my own process.
The points you outlined are fair and Council, as a group, considered pretty much each during our first three months of study.
1. Engage independent Lawyers.
I would have retained independent legal counsel for City Council alone.
You and I are never going to agree on this one. Despite your assertions, Thompson Hine and Huron Consulting provided unbiased and genuine advice to Council. Continued disparaging comments regarding Kevin Butler’s or Mike Summer’s commitment to Lakewood and their neighbors has become intolerable. Kevin Butler was and is Lakewood’s Law Director and counsel to Lakewood City Council.
2. Ask Madigan and Bullock to recuse themselves from the entire process—Their minds were made up and they had already voted for it—they voted on December 12, 2013and January 14, 2015 to give CCF its FHC.
I never had any doubt that Mary Louise Madigan and Tom Bullock had and continue to have the best intentions for the City of Lakewood and its future. How do you know that both were in favor of the LOI at the initiation of LHA’s study and deliberations? The fact that both were strong supporters of the LOI at its introduction did not sway me at all and, based upon Council’s first three months of deliberations on this matter, other previously uncommitted members were not swayed either. In addition, both provided insight as to LHA’s process and continuing work. Neither steered Council toward any preconceived conclusion and excluding them from deliberations and debate would have gained us nothing and cost us that insight.
3. Remove Madigan as council president—I know that this was discussed and you had the votes—I would have pressed for that harder. Her failure to lead was well documented.
Now, Mary Louise Madigan and I banged heads on a number of occasions on this matter. In my opinion, she was occasionally dismissive of my thoughts, concerns and objectives and I was at times disrespectful (but not out of line) and curt. If I thought for one minute her episodes of initial dismissiveness toward me hurt my ability to ask tough questions and push on this issue from all angles to get answers then her position as Council President would have been considered. Regardless, she would have remained as an influential member of Council.
In the end, she supported the opening of Council’s deliberations beyond the LOI, scheduled access to all LHA members and came to embrace my initial request that an industry consultant be identified to, among other things, review and report on LHA’s Subsidium work. Besides, leading Council does not fall in the hands of one member. Each member Council stepped up at times throughout the process as a Council leader.
Even if what you opine is correct about “you had the votes,” Council members were working hard independently, had access to information, Thompson Hine and Huron as well as LHA board members and Mary Louise Madigan was continuously asking me and others about topics we felt needed to be covered in the dozens of public meetings and hearings that followed. Nothing and nobody prevented me from contacting our Thompson Hine or Huron teams on my own via phone when I desired.
4. Restructure the LHA Board –
For all to consider, per the 1996 Master Agreement, the 23 member LHA Board consisted of seven “City” nominees which had to be approved by the Board’s Executive Committee and full board along with three trustees (Mayor and two members of Council). The three CCF appointees could not be refused. The immediate past president of the hospital’s medical staff was a member and the Board was in charge of another nine appointees.
Restructuring the Board of staggering terms so that a majority would change their minds regarding the support of its LOI would only be realistic if the LHA and the CCF agreed to change the related sections of the Master Agreement then ask City Council to approve those changes to the Master Agreement. My estimation is that either the LHA or the CCF would have balked at this notion. The tack you suggest would have taken the Hospital long past the forecast that the LHA would have been bankrupt before 2020 and no later than 2020.
5. Engaged an Investment Banker and other experts to value the hospital and value the damages caused by CCF and LHA to this vital city asset.
We knew about the $90 million of needed repairs and upgrades to the building and the garage. We independently and separately appraised the 850 Columbia Road complex and the Medical Office Building (affectionately referred to as “MOD”). Based on comparables, we discussed an estimated the value of the 5.7 acres of land under the hospital. The CCF paid the equivalent of about $900,000 per acre for the land under the MOD. This brings the land under the hospital at over $5M and the Hospital building had a book value of $20.0M and, again, had $90M in needs and upgrades.
The 850 Columbia Road complex was appraised at $6.8M in June of 2015 by Charles M. Ritley and Associates. The Clinic purchased this complex for $6.8M already paid and a $1.4M note due in 2018. The homes on Belle and St. Charles were also appraised and are being sold.
After costs, the net proceeds of 850 Columbia = $8,045,000 ($6.6M already received by Lakewood and $1.4M due in less than two years.
Hospital Rehab/Demo = $7,000,000 ($500,000 receivable in 2016 and $6.5M in 2018)
Sale of MOB and Parking Garage = $1,557,000
Conservative value of homes = $900,000
6. Demand that special legal counsel be appointed to review and likely join the taxpayer lawsuit.
This would have not satisfied you and others at all. Should that appointed special legal counsel opine that the taxpayer lawsuit should not be joined you and others would have immediately demanded that a new special legal counsel be appointed because the previous one was tainted, biased and not independent because it was selected by City Council. My point is illustrated by your continued portrayal of Huron and Thompson Hine as not independent (see question one). The only way you would have been satisfied on this point is if Council hired a special legal counsel that was predetermined to commit to the lawsuit.
7. In September, 2015, I would have demanded Butler’s resignation.
Despite your fixation on unfairly portraying Kevin Butler as inept and not fighting for the future of Lakewood, Council struck a fair deal. The city will receive more in lease payments than if the previous lease/Master Agreement went through to 2026. $128 million in LHA net assets have been properly allocated. The Clinic is investing another $49 million of its money. An up to $90 million liability is off taxpayer shoulders. And we will benefit from a state of the art medical facility and fully accredited ER all while retaining 5.7 acres of developable land for future sale. Another liability, the Medical Office Building, underperforming and not very competitive, was sold at fair market value based on independent appraisals and is being replaced with the new FHC and ER. The down side, of course, involves the loss of jobs but Lakewood has always had a diverse tax base and increases in other sources of revenue have already made up for that payroll tax loss. Regarding the medical services of the former hospital, two out of every three beds were empty every night for a year prior to January of 2015 and those revenue producing service lines were also already gone and were not coming back.
8. Assemble a group of experts. As I wrote to you, council and Summers on April 13, 2015, the city would have clearly ended up with more by doing nothing ...
As I’ve asked repeatedly to you and others, name one health care management entity that wanted to bid/submit an RFP but could not or did not.
Name one entity that wanted to come into this region as a new market entrant and compete with Metro, UH and the Clinic without access to doctors, referrals (patients), a network with other non Metro, UH or Clinic hospitals while doing so in a building that needs $90M to make it competitive and safe.
9. I could go at greater on later after giving this greater thought—I have written so much on this—Remember my article in the LO “Council needs to act like a landlord?" or something like that. Putting a defaulting tenant in charge of selling your property is a pretty dumb idea.
I don’t want to copy my reaction that I put under question number 7 but that sums it up.
David Anderson
The points you outlined are fair and Council, as a group, considered pretty much each during our first three months of study.
1. Engage independent Lawyers.
I would have retained independent legal counsel for City Council alone.
You and I are never going to agree on this one. Despite your assertions, Thompson Hine and Huron Consulting provided unbiased and genuine advice to Council. Continued disparaging comments regarding Kevin Butler’s or Mike Summer’s commitment to Lakewood and their neighbors has become intolerable. Kevin Butler was and is Lakewood’s Law Director and counsel to Lakewood City Council.
2. Ask Madigan and Bullock to recuse themselves from the entire process—Their minds were made up and they had already voted for it—they voted on December 12, 2013and January 14, 2015 to give CCF its FHC.
I never had any doubt that Mary Louise Madigan and Tom Bullock had and continue to have the best intentions for the City of Lakewood and its future. How do you know that both were in favor of the LOI at the initiation of LHA’s study and deliberations? The fact that both were strong supporters of the LOI at its introduction did not sway me at all and, based upon Council’s first three months of deliberations on this matter, other previously uncommitted members were not swayed either. In addition, both provided insight as to LHA’s process and continuing work. Neither steered Council toward any preconceived conclusion and excluding them from deliberations and debate would have gained us nothing and cost us that insight.
3. Remove Madigan as council president—I know that this was discussed and you had the votes—I would have pressed for that harder. Her failure to lead was well documented.
Now, Mary Louise Madigan and I banged heads on a number of occasions on this matter. In my opinion, she was occasionally dismissive of my thoughts, concerns and objectives and I was at times disrespectful (but not out of line) and curt. If I thought for one minute her episodes of initial dismissiveness toward me hurt my ability to ask tough questions and push on this issue from all angles to get answers then her position as Council President would have been considered. Regardless, she would have remained as an influential member of Council.
In the end, she supported the opening of Council’s deliberations beyond the LOI, scheduled access to all LHA members and came to embrace my initial request that an industry consultant be identified to, among other things, review and report on LHA’s Subsidium work. Besides, leading Council does not fall in the hands of one member. Each member Council stepped up at times throughout the process as a Council leader.
Even if what you opine is correct about “you had the votes,” Council members were working hard independently, had access to information, Thompson Hine and Huron as well as LHA board members and Mary Louise Madigan was continuously asking me and others about topics we felt needed to be covered in the dozens of public meetings and hearings that followed. Nothing and nobody prevented me from contacting our Thompson Hine or Huron teams on my own via phone when I desired.
4. Restructure the LHA Board –
For all to consider, per the 1996 Master Agreement, the 23 member LHA Board consisted of seven “City” nominees which had to be approved by the Board’s Executive Committee and full board along with three trustees (Mayor and two members of Council). The three CCF appointees could not be refused. The immediate past president of the hospital’s medical staff was a member and the Board was in charge of another nine appointees.
Restructuring the Board of staggering terms so that a majority would change their minds regarding the support of its LOI would only be realistic if the LHA and the CCF agreed to change the related sections of the Master Agreement then ask City Council to approve those changes to the Master Agreement. My estimation is that either the LHA or the CCF would have balked at this notion. The tack you suggest would have taken the Hospital long past the forecast that the LHA would have been bankrupt before 2020 and no later than 2020.
5. Engaged an Investment Banker and other experts to value the hospital and value the damages caused by CCF and LHA to this vital city asset.
We knew about the $90 million of needed repairs and upgrades to the building and the garage. We independently and separately appraised the 850 Columbia Road complex and the Medical Office Building (affectionately referred to as “MOD”). Based on comparables, we discussed an estimated the value of the 5.7 acres of land under the hospital. The CCF paid the equivalent of about $900,000 per acre for the land under the MOD. This brings the land under the hospital at over $5M and the Hospital building had a book value of $20.0M and, again, had $90M in needs and upgrades.
The 850 Columbia Road complex was appraised at $6.8M in June of 2015 by Charles M. Ritley and Associates. The Clinic purchased this complex for $6.8M already paid and a $1.4M note due in 2018. The homes on Belle and St. Charles were also appraised and are being sold.
After costs, the net proceeds of 850 Columbia = $8,045,000 ($6.6M already received by Lakewood and $1.4M due in less than two years.
Hospital Rehab/Demo = $7,000,000 ($500,000 receivable in 2016 and $6.5M in 2018)
Sale of MOB and Parking Garage = $1,557,000
Conservative value of homes = $900,000
6. Demand that special legal counsel be appointed to review and likely join the taxpayer lawsuit.
This would have not satisfied you and others at all. Should that appointed special legal counsel opine that the taxpayer lawsuit should not be joined you and others would have immediately demanded that a new special legal counsel be appointed because the previous one was tainted, biased and not independent because it was selected by City Council. My point is illustrated by your continued portrayal of Huron and Thompson Hine as not independent (see question one). The only way you would have been satisfied on this point is if Council hired a special legal counsel that was predetermined to commit to the lawsuit.
7. In September, 2015, I would have demanded Butler’s resignation.
Despite your fixation on unfairly portraying Kevin Butler as inept and not fighting for the future of Lakewood, Council struck a fair deal. The city will receive more in lease payments than if the previous lease/Master Agreement went through to 2026. $128 million in LHA net assets have been properly allocated. The Clinic is investing another $49 million of its money. An up to $90 million liability is off taxpayer shoulders. And we will benefit from a state of the art medical facility and fully accredited ER all while retaining 5.7 acres of developable land for future sale. Another liability, the Medical Office Building, underperforming and not very competitive, was sold at fair market value based on independent appraisals and is being replaced with the new FHC and ER. The down side, of course, involves the loss of jobs but Lakewood has always had a diverse tax base and increases in other sources of revenue have already made up for that payroll tax loss. Regarding the medical services of the former hospital, two out of every three beds were empty every night for a year prior to January of 2015 and those revenue producing service lines were also already gone and were not coming back.
8. Assemble a group of experts. As I wrote to you, council and Summers on April 13, 2015, the city would have clearly ended up with more by doing nothing ...
As I’ve asked repeatedly to you and others, name one health care management entity that wanted to bid/submit an RFP but could not or did not.
Name one entity that wanted to come into this region as a new market entrant and compete with Metro, UH and the Clinic without access to doctors, referrals (patients), a network with other non Metro, UH or Clinic hospitals while doing so in a building that needs $90M to make it competitive and safe.
9. I could go at greater on later after giving this greater thought—I have written so much on this—Remember my article in the LO “Council needs to act like a landlord?" or something like that. Putting a defaulting tenant in charge of selling your property is a pretty dumb idea.
I don’t want to copy my reaction that I put under question number 7 but that sums it up.
David Anderson
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David Anderson
- Posts: 400
- Joined: Mon Jun 05, 2006 12:41 pm
Re: What would you have done, Brian?
The first thing I thought about as a Member of Council, Brian, was to determine a way to continue the delivery of quality health care in Lakewood and access to a fully functioning Emergency Room. Pushing Council to hire a leading industry consultant to analyze Subsidium’s report was a good first step.
After months of study and intense hearings and meetings, I realized that Council’s options in securing the delivery of health care and access to a 24/7 emergency room in Lakewood were limited in realistic terms. Again, as I’ve asked repeatedly to you and others, name one health care management entity that wanted to bid/submit an RFP but could not or did not. Name one entity that wanted to come into this region as a new market entrant and compete with Metro, UH and the Clinic without access to doctors, referrals (patients), a network with other non Metro, UH or Clinic hospitals while doing so in a building that needs $90M to make it competitive and safe.
Despite your posts, it was not a slam dunk to win the various legal theories you put forward in a number of these threads - responsibility for capital plans and operating losses, breech of contracts when the City of Lakewood never had a contract with the Clinic. We leased the buildings to LHA. LHA had the contract with the Clinic. This would have been a tough battle but my objective was to win the war - the delivery of world class health care in Lakewood and access to a fully functioning ER.
Also take into consideration, Brian, that many of the 8-9 actions you would have taken are seemingly of the position that one person could somehow dictate and achieve all of these. There are seven members of Council, a Mayor, 23 members of the LHA Board, I don't know how many members of Metro's board, etc. You are not in a room tweeting out orders. Being mindful of others' opinions on the matter and understanding that others may have differing opinions is important in terms of being persuasive and persuadable. There is idealism and then reality. This last point is closer to where I saw this thread going and I hope to get your reaction.
David Anderson
After months of study and intense hearings and meetings, I realized that Council’s options in securing the delivery of health care and access to a 24/7 emergency room in Lakewood were limited in realistic terms. Again, as I’ve asked repeatedly to you and others, name one health care management entity that wanted to bid/submit an RFP but could not or did not. Name one entity that wanted to come into this region as a new market entrant and compete with Metro, UH and the Clinic without access to doctors, referrals (patients), a network with other non Metro, UH or Clinic hospitals while doing so in a building that needs $90M to make it competitive and safe.
Despite your posts, it was not a slam dunk to win the various legal theories you put forward in a number of these threads - responsibility for capital plans and operating losses, breech of contracts when the City of Lakewood never had a contract with the Clinic. We leased the buildings to LHA. LHA had the contract with the Clinic. This would have been a tough battle but my objective was to win the war - the delivery of world class health care in Lakewood and access to a fully functioning ER.
Also take into consideration, Brian, that many of the 8-9 actions you would have taken are seemingly of the position that one person could somehow dictate and achieve all of these. There are seven members of Council, a Mayor, 23 members of the LHA Board, I don't know how many members of Metro's board, etc. You are not in a room tweeting out orders. Being mindful of others' opinions on the matter and understanding that others may have differing opinions is important in terms of being persuasive and persuadable. There is idealism and then reality. This last point is closer to where I saw this thread going and I hope to get your reaction.
David Anderson
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David Anderson
- Posts: 400
- Joined: Mon Jun 05, 2006 12:41 pm
Re: What would you have done, Brian?
Sorry for the flurry of posts, Brian.
Do you believe in moral absolutes, Brian? You know, the points that there is absolutely no compromising on despite the realities of the situation. Are there any of the 8-9 points you made in your initial post that you would have been willing to compromise on?
David Anderson
Do you believe in moral absolutes, Brian? You know, the points that there is absolutely no compromising on despite the realities of the situation. Are there any of the 8-9 points you made in your initial post that you would have been willing to compromise on?
David Anderson
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Patrick Wadden
- Posts: 265
- Joined: Thu Oct 01, 2015 11:04 am
Re: What would you have done, Brian?
Jim O'Bryan and Dan Alaimo,
I am requesting that this thread be "pinned" on the Observation Deck. The responses posted by Councilman Anderson to Brian Essi's posts are important and essential to the reasonable people of Lakewood that read the Deck.
Thank you in advance,
Let's stop the Madness, this is nuts.
Patrick Wadden
Vote FOR 64
I am requesting that this thread be "pinned" on the Observation Deck. The responses posted by Councilman Anderson to Brian Essi's posts are important and essential to the reasonable people of Lakewood that read the Deck.
Thank you in advance,
Let's stop the Madness, this is nuts.
Patrick Wadden
Vote FOR 64
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Bill Call
- Posts: 3319
- Joined: Mon Jun 06, 2005 1:10 pm
Re: What would you have done, Brian?
This is the public discussion that should have taken place 5 years ago.Stan Austin wrote:I see the possibility in this thread for the discussion that should have taken place.
Instead a small group worked in secret to subvert Lakewood Hospital and convert its public assets to private use.
The $33 million in the Lakewood Hospital Foundation was a key motivating factor in the secret decision. A $33 million City asset has been converted into an arm of the Cleveland Clinic Foundation that is under the control of people who do not live in Lakewood and don't give a damn about Lakewood. The new purpose, "to serve Lakewood and surrounding communities" says it all.
Whatever other cash is left will be controlled by another arm of the Cleveland Clinic Foundation and another small group with dreams of bike trails in Brunswick, new hospitals in Mentor, and cash spread all around Northeast Ohio. Lakewood will get a few crumbs here and there that will be announced with great fanfare and publicity. Over time, millions will be quietly and privately spent far, far away.
The deal agreed to by Council is just a bad real estate deal with a dash of incompetence and a whole lot of private dealing and corruption.
Vote against 64.