Upon receiving a Feb. 27 letter from Nicholas Koffroth, the attorney for the San Benito Health Care District, which advised the district to not participate in the San Benito County Intergovernmental Advisory Committee meetings regarding the future Hazel Hawkins Memorial Hospital, the committee voted unanimously Mar. 1 to send two letters in response. The first letter was to encourage the district to return to the meetings in April, and the second, to request access to the District’s “data room.”
“On Jan. 6, we requested three years of detailed line-item statements from the hospital of all divisions’ operations, as well as access to cash flow and their data room so we can see what we can do to help them,” said San Benito County Supervisor Kollin Kosmicki, who chairs the Intergovernmental Advisory Committee.
County Counsel Barbara Thompson described the data room as the place where the district kept its financials for access by entities that might be interested in acquiring the hospital. The district had told the county it would make the index to the financial information available, “so we can request different types of information,” she said.
Koffroth’s letter stated: “Although not the District’s preferred option to adjust its debts, the district must leave open the possibility of a bankruptcy filing should it become a necessary tool for the district to continue providing safe, quality patient care or to preserve its health care facilities for the community.”
The letter explained that because of overlapping meetings and the request for confidential materials the law firm had prepared for the “neutral evaluation process,” there was concern that the information “made confidential by California law” might be disclosed during the open meetings.
“The District cannot risk disruption of the neutral evaluation process because the process is a prerequisite for a bankruptcy filing,” Koffroth wrote. “It would be irresponsible for the district to take any action that would limit its recourse to restructuring tools, such as the Bankruptcy Code, at this juncture. As such, we have advised the district to conclude its participation in the Committee meetings until the neutral evaluation process is completed.”
Members of the committee voiced concerns about the lack of transparency the district’s absence from the meetings would cause. County Administration Officer Ray Espinosa gave a vague warning that, ultimately, the county would be responsible if the hospital were to close. He said various county departments had been working on emergency plans should the district file bankruptcy. Committee member Angela Curro said the hospital must not close but added, “We don’t want to be in the hospital running business.”
Committee member and Hollister City Councilmember Rolan Resendiz made a motion to include in the response to the district that the committee would follow the recommendation of the supervisors, Espinosa, and city managers of Hollister and San Juan Bautista. He said the Intergovernmental Committee meetings were the most appropriate place to bring together all interested parties and the public to assure transparency, and he wanted the district to return in April, also suggesting that it “go after private donors.”
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