Nearing the end

The Times is at it again, doing what they can to try to influence public opinion to support their chosen ones.

Their recent reporting on the county hospital/children’s hospital has been highlighting deficiencies in the arguments the children’s hospital is trying to make.

Make no mistake, the children’s hospital has gotten into a mess.  Their outrageously expensive interim management team is making the mess worse.  Unless a white knight swoops in at the last minute it looks like the hospital will fail.

What the Times is not highlighting is how this mess came about.  Feel free to add to this list:

  1. The hospital should never have been built.  Numerous studies pointed out that there was little need and the hospital would have little chance of being economically viable.
  2. Our county leaders decided that they knew better and sold us a bill of goods and a bond issue.
  3. While the studies predicted failure with a moderately sized facility our county leaders decided to build an even bigger one.
  4. Near opening day our county leaders played dirty pool and stalled the presentation of contracts between the two hospitals.  The leadership of the children’s hospital made a fatal mistake and accepted the contracts so that they could open the doors when they should have insisted on fair contracts.  Instead they believed the county pitch “trust me, I’m with the government”.
  5. Our county officials are charging the children’s hospital close to $10 million per year for rent even though the taxpayers are paying for the building separately through a bond issue.
  6. Rather than fix the mess when the children’s hospital fell behind on its payments, our county officials waited until the debt was insurmountable thus guaranteeing that the county would gain control.

The county got us into this mess and now we are going to have to pay for it.  More on that later.

We deserve better

Brutus

15 Responses to Nearing the end

  1. Questions Still Unanswered says:

    Assume for a minute that Children’s Hospital should pay rent equal to the annual interest and principal payments to service the amount of debt that was incurred to build the hospital. How does the actual debt service compare to the amount of rent being charged by UMC? How much profit did UMC build into the rent that it is charging? How much of the total bond offering amount was actually used for CH and how much was possibly diverted for other purposes? Why have these questions never been asked? If the county judge and commissioners wanted CH to succeed, why is it that they never took the time scrutinize or audit all the other fees UMC charges to CH? The queen and her court are not interested in truth or accountability.

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    • Jerry Kurtyka says:

      Judge Escobar has repeatedly called the rental debt “soft costs.” That was when the agreement was to convert some of it into equity held by UMC.

      I would appreciate her explaining what was meant by soft costs now that it appears CH may be on the hook for the debt while we continue to pay on the bonds. Maybe we could renege and call the bond debt a “soft cost?”

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    • Reality Checker says:

      Memo to Veronica Esobar and the County Commissioners:

      Between October 2008 and May of this year, UMC paid $41.9 million in interest and $5.7 million to the principal of the Children’s Hospital Bonds, according to numbers provided to the El Paso Times by UMC.

      That means the debt service on the bonds is about $7.3 million annually. Also, bear in mind that not all of the entire $120 million in bonds was for construction. During that same period, UMC has charged CH $10.4 milion annually for rent.

      That implies that UMC has been trying to profit to the tune of about $3 million annually off the spread between the debt service and what they have billed CH for rent.

      Part of the $120 million was to be used for equipment. If UMC is also charging additional fees for equipment, they are profiting to an even greater extent.

      This also means that UMC’s plan all along was for CH to subsidize UMC’s finances.

      You and your court are apparently not the ones to judge this situation.

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  2. Concerned Citizen-DRL says:

    I firmly believe that this whole fiasco was generated to supply UMC with a new hospital facility-designed to fail up front and miraculously rescued by the county and UMC-knowing full well that the citizens of El Paso would never pass a bond issue to supply the county with a new facility. They found some very good hearted naive people and an issue with a bleeding heart and duped the taxpayers. This is going to hang around or necks indefinitely.

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  3. Brutus says:

    A shy reader sent this great point in:

    the funding formula for children’s hospitals supposedly changed right after the hospital construction began and our professional hospital administrator did not inform us of this upcoming change. remember, the federal government is pretty transparent about these changes in advance.

    Brutus

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  4. Brutus, great blog. Just to add two more points. The fraud committed in order to receive federal funding. The two entities mutually agreed to do so. Can’t tell me the deal wasn’t sanctioned by the county. Or does it mean they were asleep at the wheel AGAIN ? Either way the responsibility is theirs.

    Second point is now that the fraud has been admitted, the monies will have to be repaid and possible penalties. Plus past due rent. So where are the Feds on the issues? Investigation ? Prosecution of those responsible? Hhhhmm.

    Notice the PR that has been launched. Perez on tv discussing Ethics ! Escobar discussing who is responsible for the hospital fiasco. Ordaz pretending to appear that she was very open and cooperative about the county’s attempt to control the city. She released more emails than required? Sound familiar ?

    Note the same faces always appear in the shadows of each manipulation and disaster. Let’s not forget, the band leader and the assistant. Suddenly there is no mention of either one, why ? Doesn’t do any good to fire an employee and keep them around. Why fire and then seek their guidance? Was the firing a political ploy?

    Don’t let the bs overwhelm you. They and they are responsible for every bit of it. Time to start cleaning house . Luther will be released soon and the superintendent is out. Theres plenty of room.

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  5. Haiduc says:

    Not the end but the Beginning of a new financially viable and still much needed El Paso Children’s Hospital !

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    • Reality Checker says:

      Children’s Hospital would be financially viable now if it was not being exploited by UMC. If UMC gets control of CH, UMC will no longer charge for rent or they will significantly reduce the rent. They will also eliminate or reduce other service fees they are currently charging CH. That financial engineering is how UMC will make it appear that they magically turned CH around.

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    • taxpayer 13 says:

      I disagree. We did not need a children’s hospital. Providence was — and is — serving that need. Studies done prior to the building of the hospital said what we needed was more pediatric specialists, not a hospital.
      I did not vote for the hospital. Escobar and the other whiners who advocate spending taxpayer money to meet every single social need should be shamed. I think this is the biggest fiasco our city or county has ever perpetrated on the public. .

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  6. Andrea says:

    It should never have been built. Study after study supported this argument. Now that the respective egos have been satiated, the El Paso taxpayers will be asked to give even more to clean up this mess. El Paso does deserve better. Most importantly, the children of this fine City deserve better than the fractured system they now have to depend on.

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  7. Rodney Fender says:

    Escobar should be recalled. Valenti should be fired. And the very expensive management teams and boards should be let go and replaced with some competent local people!

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  8. Reality Checker says:

    Both sides have contributed to the current mess, but for some reason the Tlimes is focused only on the mistakes made by Children’s Hospital and is overlooking how UMC and Valenti contributed to the mess. As an example, they failed to acknowledge that Valenti and the UMC put together the entire plan and financial pro forma for the Children’s Hospital. CH management was set up to fail from day one. The Times also never acknowledged that at least one person served on the board of both hospitals. How a CEO and CFO who let things get this screwed up can not only keep their jobs, but also be rewarded and enriched for failure is baffling.

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  9. You got it! I, for one, am disgusted every time I see Escobar being interviewed, because she talks as if all the problems lie with EPCH, when she is, after all is said and done, the personal who should be ultimately responsible. It is like she is an honor graduate of the Pontius Pilate School of Hand Washing.

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