Letter: Supervisor 'Troubled by Lack of Trasparency'

As an Upper Providence Township Supervisor and a resident of Montgomery County, I am troubled by the lack of transparency surrounding the sale of the County’s Parkhouse facility on Black Rock Road.  The proposed sale, which the County is rushing to close before the end of the year, includes approximately 220 acres of rolling farmland in my township that has been designated as open space on County planning maps since at least 2005.  It was designated as permanently protected open space in the Township’s 2006 Open Space Plan which was then incorporated into the Township’s 2010 Comprehensive Plan.

As a Township Supervisor, my concern is for the future of this property.  Once this gem of open space is transferred to a for-profit entity, its preservation cannot be assured.  Why hasn’t the County offered to subdivide off the geriatric facility and keep the balance of the tract preserved as open space?

On October 8, the County Commissioners heard a recommendation from the “working group” assigned to evaluate the RFP submissions for the purchase of Parkhouse.  This group, made up entirely of County employees, recommended that the RFP be awarded to Mid-Atlantic Healthcare LLC.  After only eight days of deliberation and no public input, the County Commissioners voted unanimously to sell Parkhouse to Mid-Atlantic for $39 million.  During that meeting, the Commissioners spoke often about the happy employees they encountered during their scheduled tour of a Mid-Atlantic facility and gushed about how nice the facility smelled.  At no time during the public information session on October 8 or during the regularly scheduled meeting on October 17, did anyone tasked with evaluating this transaction address the fiscal health of Mid-Atlantic Healthcare, LLC.

Mid-Atlantic Healthcare is a company currently undergoing a rapid expansion, and has, in fact, doubled in size since 2011.  Excluding Parkhouse, Mid-Atlantic Healthcare currently owns fourteen facilities in Pennsylvania and Maryland, seven of which have been acquired only within the last two years.  They have financed the purchase of at least $106 million for six of these seven homes. 

One of the primary reasons that the Commissioners cited for selling Parkhouse was that, according to County Chief Financial Officer, Uri Monson, the facility loses $2 to $7 million per year.  Mid-Atlantic’s rosy presentation on October 8 included assurances that care at Parkhouse would not be compromised, employees would retain their level of seniority and salary and the community would continue to be served by this resource.  Dr. Scott Rifkin, the principal of Mid-Atlantic, claims he can save money by joining a group purchasing organization (“GPO”); however, it seems unlikely that this strategy will be enough to not only honor Mid-Atlantic’s lofty promises, but cover the losses that Parkhouse allegedly incurs annually and the debt service of $39 million for the purchase. 

This raises several additional questions:  Has Mid-Atlantic committed to retaining a certain percentage of Medicaid beds, or will they abandon the Medicaid patients in favor of private pay insurance to increase their revenues?  Will Mid-Atlantic need to develop the balance of the property to make its numbers add up?  And if it was as simple as joining a GPO to save that much money, why didn’t Montgomery County attempt to do that before selling? 

On October 30, the site of the once-proposed Studio Center at Logan Square was sold at auction for a meager $8,000, leaving Montgomery County with a gaping budget hole of $24.5 million as second position lien holder on the property.  There remain many unanswered questions about the uses of some $61.5 million that was poured into that site for what eventually amounted to the refurbishment of an existing office building. Since no real compelling reason has been given for the urgency of closing the sale by year end, it would be unfortunate to conclude that Parkhouse, and Montgomery County’s most vulnerable low to moderate income aging population who depend upon it, are being sacrificed simply to fill this budget hole.

There remain too many unanswered questions regarding this sale and I would urge that the County Commissioners slow down and honor their commitment to transparency by allowing for a more public vetting of Parkhouse sale before proceeding further. 

Lisa Mossie

Vice Chairman

Upper Providence Township