How the Grinch sold Parkhouse

Commissioners, why? Why are you selling our open space? Why?

At the end of November, Dr. Scott Rifkin, the principal of Mid-Atlantic, contacted me requesting a one on one meeting. For a number of reasons, I thought that a meeting of this nature was a bad idea, not the least of which is that I believe that the last thing that would be beneficial for Upper Providence in a transaction that has been characterized by a lack of transparency is yet another meeting behind closed doors. I suggested instead that Dr. Rifkin attend a public meeting of the Upper Providence Township Supervisors where the public could attend as well. Citing concerns that a large public meeting would seem too much like a "political event" where citizens would get caught up in their emotions and that large public forums "lend to grandstanding and posturing," Dr. Rifkin insisted on a much smaller delegation. Dr. Rifkin was particularly concerned about the press being in attendance and insisted in more than one correspondence that the press should NOT be invited because of "political posturing and grandstanding."

As a compromise, I offered for our first meeting the Upper Providence staff meeting, which is a typically a lower-key, but still publicly advertised meeting where all three Township Supervisors would be present. I also insisted on having one or two members of the public present as well. Dr. Rifkin agreed to come to our staff meeting on December 18.

I asked for two volunteers from the community to be present at the staff meeting. Ray Emrich and Joe Haney volunteered. In the days leading up to the meeting, I heard from several additional residents who wished to be included in the meeting, but, as I explained in my responses to them, I had given my word to Dr. Rifkin that this meeting would be limited to two members of the public. As this was our first meeting with Dr. Rifkin, I thought it was of the utmost importance to establish this relationship in good faith by honoring my word and I did not want him to feel "ambushed." Our complaint, after all, ultimately is not with Dr. Rifkin, but with Montgomery County. Every member of the community I spoke with agreed that this was the best way to proceed.

Dr. Rifkin showed up one hour late for the meeting, explaining that he got lost on the way to the Township building, which is literally 1.4 miles away from Parkhouse and on the same road as his proposed $39 million investment.

Below is the update I sent to the community regarding the December 18 meeting:

-----Original Message----- From: Lisa A. Mossie To: XXXXXX Sent: Wed, Dec 18, 2013 5:04 pm Subject: Parkhouse Update

Hello Everyone,

Township staff and Ray Emrich met with Dr. Scott Rifkin today. I feel that we gained very little new information today, but did establish a working relationship with Dr. Rifkin and by association, Mid-Atlantic Healthcare. Dr. Rifkin suggested that a small committee be designated to meet on a regular basis to discuss the Parkhouse land going forward. More on that in the coming days as it takes shape. I would like to have one or two representatives from the Community included in this group.

Dr. Rifkin’s remarks centered upon Mid-Atlantic’s ability to run Parkhouse at a profit. He gave us a lot of background on his operations and the history of his company and some contacts we could call to gather information on Mid-Atlantic. He emphasized that he is not a developer. He stressed that it was important to him to have a good relationship with the Community he serves.

Dr. Rifkin gave us assurances that Mid-Atlantic has no current plans to develop the land, and he says that they are at least a year or two away from even considering doing anything with it. His immediate concern is addressing the operations and efficiencies of the senior center. Some intriguing ideas were tossed about for the land, most of which involved the preservation of the majority of it as open space. The concern I expressed to Dr. Rifkin was the public’s loss of access to the land once it comes into private ownership. Dr. Rifkin acknowledged this concern and until his development plans are finalized, expressed only one reservation regarding allowing continued public access to the land, and that was one of liability insurance, which I agree, is a legitimate concern for Dr. Rifkin once he owns the land.

When asked directly, Dr. Rifkin stated that the land was NOT critical to maintaining the ongoing operations of the senior center and that he had no plans to “flip” the land once taking ownership. I asked him if he did end up selling the land, would he consider giving he Township the right of first refusal, which he said he probably would.

Dr. Rifkin did state that the purchasing agreement with the County has been signed and that he personally saw no reason why the county would not release the terms of the sale, but he could not give us those details as it was proprietary of the County. Dr. Rifkin says he purchased the land because the County did not offer the purchase of the facility without it.

I told Dr. Rifkin that while I believe it is important that we establish the group to work with Mid-Atlantic going forward, the Township’s position is that the property is Open Space and that we will continue to fight the county to keep the land in public hands. The county and the township have both designated and assumed the land around Parkhouse would remain open space; the Township’s comprehensive plan, which has been widely recognized for its excellence, will be essentially nullified if this 220 acres of open space is developed.

Ray, please feel free to add your impressions or anything you think I may have missed.

Lisa Mossie

It came as a somewhat unpleasant surprise to me and several members of the community to have the following email arrive in our inboxes on Christmas Day:

To the Lower Providence Community

It has come to my attention that a rally regarding the Parkhouse land issues is planned for this week. This seems to be more motivated by political career building than to any attempt to solve substantive issues.

On December 18, I met with the entire leadership team of the township in a meeting. The tone of the discussions were positive and there was an open discussion of the community's interests regarding Parkhouse and the associated land. I found the discussion to be positive and the tone to be congenial and aimed at finding the best possible outcome for all parties. The elected officials as well as staff and local residents attended.

At the meeting, I made it clear that Mid-Atlantic Health Care is a provider of high end skilled rehabilitation and nursing home care. Our focus is on patients not development and that we have no set plans for the land. We also offered to meet with an ongoing committee from the community to plan together how the land is best used. We even offered to keep the land available for public use if the township could help us solve legal liability issues. I walked away from the meeting believing we had agreed on these first steps and that we would work together on these issues.

I am, therefore, somewhat surprised that a public protest is scheduled. The purchase agreement has been signed by MAHC and the County. The sale will close at the end of a very short due diligence period. The property, which was never designated by the County as permanently preserved "open space", will be privately held. As the property owner, we care deeply about our relations with the community and have held out the olive branch and asked for planning assistance and a collaborative effort. Other than political career building I can't understand the motivation of the protest organizer. I sincerely think this is an occasion where more will be accomplished with collaboration than with confrontation. I look forward to meeting with the committee discussed at the previous meeting and to working with the solicitor to address liability issues so the land can stay in use. My email is xxxxxxxxx@gmail.com for anyone who wishes to reach out to me directly for further discussion or information.

Have a wonderful holiday season,

Scott Rifkin, M.D. Managing Partner MAHC

Sent from my iPad Sent from my iPad

I received a duplicate email immediately thereafter addressed "To the Upper Providence Community." Apparently, the press-shy Dr. Rifkin also sent his letter to the local media. That evening, the Times Herald posted the following story to their website:

COURTHOUSE — A group led by Upper Providence Supervisor Lisa Mossie will plans (sic) to protest the sale of the Parkhouse facility in Upper Providence outside of the Montgomery County Courthouse Saturday at noon.

Along with protesting the sale of the facility itself, the group is also opposed to the sale of the 220 acres surrounding Parkhouse. Mossie and opponents of the sale say the area is protected open space.

The county maintains the land was never designated as open space and just went undeveloped while the county owned it.

In a letter to the residents of Upper Providence, CEO of Mid-Atlantic Health Care Scott Rifkin said he was unsure why a protest is happening when he’s done all he can to work with the township.

Rifkin also stated he has no plans to develop the land and is trying to work with Upper Providence officials to keep the land open to the public.

“Our focus is on patients, not development, and that we have no set plans for the land,” Rifkin wrote in an email to Upper Providence residents. “We also offered to meet with an ongoing committee from the community to plan together how the land is best used. We even offered to keep the land available for public use if the township could help us solve legal liability issues.”

I responded to Dr. Rifkin the following day:

Dear Scott,

If you wanted to address the residents of Upper Providence, it seems to me that a far better option than emailing people on Christmas would have been to appear at a Monday evening Township meeting as I originally suggested when you first proposed to meet . I’m not sure from whence you have discerned the motives of the rally, which was suggested and organized by one of our residents, but in Montgomery County, where the landscape is littered with the lives and political careers of those who have found themselves on opposite sides of the issues, there are far easier and safer ways to engage in “political career building” than taking on the current County administration.

That being said, I reiterate my remarks that I made to you on 12/18: The land surrounding Parkhouse that you propose to buy is Open Space and should never have been offered for sale by the County. There is plenty of Montgomery County Planning Commission evidence to back this up. I believe that the sale of Open Space by the County constitutes a breach of the public trust and I would prefer to see this land remain publicly owned.

As I recall, I told you I intended to fight for the land and even said that I hoped you wouldn’t take it personally. The rally should not be a surprise to you at all.

Lisa Mossie

Dr. Rifkin's reply to me was:

Lisa,

Thanks for the nice note. Not taking it personally.

I am working with the assumption that the sale will go through and that I will need to work closely with the township leadership to find common ground. Contracts have been signed.

I appreciate the offer to participate in a Monday night meeting but find that such meetings rarely solve issues. There are just too many folks to take the time and attention to detail needed to solve these issues. However, once we have worked together on the issues and found common ground then I'd be happy to go hand in hand with leadership to discuss that common ground with the public.

Lisa, as for the Christmas email, that may not be great timing by our folks but I don't think anyone had to open it on that day. I am Jewish and must admit that I have received many an email from some non-jewish person on a high holiday. I simply wait for the holiday to be over. I'm never offended as I don't assume that Christians pay much attention to our holidays.

I am eager to meet with you and the Township staff whenever you are ready to discuss two basic issues. One, how we keep the land open to folks who wish to use it in the next few years. Two, how we plan the possible uses over the long term. Your solicitor seemed open to a discussion of liability so we can keep the land open immediately. We obviously don't want someone hunting to shoot someone walking a dog and then be held liable. Let me know when is good to meet.

Thanks and hope your Christmas was wonderful,

Scott

Dr. Rifkin has insisted on several occasions that he is not a political man and has no desire to get in the middle of a political battle. Nevertheless, it appears that is exactly where the County has put him. The insistence that the resistance to this sale is about political career building and not about the loss of precious Open Space, and the County Commissioners' breach of the public trust in selling it, is a canard that I have heard several times. It's insulting and hurtful to the residents of Upper Providence, who deserve to have their concerns taken seriously and not spun into a media message in an attempt to pretty-up the ugly facts about this sale.

My advice to Dr. Rifkin, in this somewhat "open letter" to him, would be that he should stop taking political cues from One Montgomery Plaza. Recognize that the outrage over the County's betrayal of the taxpayers is real. When one sends an email with the subject line, "Parkhouse" on Christmas day, understand the community's emotional connection to this property, recognize that most people get their emails on their phones (or iPads) and know that they will open that email immediately.

The residents of Upper Providence understand that there would be no "issues to resolve" if the land remained in the hands of the public. Their complaint is not with Mid-Atlantic or Dr. Rifkin; it is with the County Commissioners who should never have put Open Space up on the auction block.

"If you like your geriatric facility, you can keep your geriatric facility"

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.