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Update on squandering $163,000 of taxpayer’s money

By Donna Westfall – January 18, 2019 – Want to know what really irks me?  It’s when a member of the public asks for information that ought to be available and then finding themselves being stonewalled.

Here’s an example. In follow up to our article “Will our Board of Supervisors vote to squander $163,000 of taxpayer’s money?” published January 16, 2019 I emailed two parties:  1.) the owner/landlord of the lease; and 2.) Heather Snow, Director of Behavioral Health Branch of the Department of Health and Human Services (DHHS).

1.) Email To the owner/landlord

Hearing about $163,000 penalty for early termination on the 10 year lease sounds high for the premises located at 1279 2nd St. I’m curious to know how much was spent in leasehold improvements?

I’d also like to know if Northridge Electric is planning on moving back in or planning on re-renting to another tenant? I’d appreciate it if someone could respond no later than Monday, Jan 21st by 5 pm.
RESPONSE FROM LANDLORD:
“Unfortunately this matter has been turned over to our attorney and although we would like to answer your questions, we cannot comment at this time.  We are hoping for a quick resolution which all parties will be satisfied with.
Thank you,

Scott Kinikin

Office Manager
Northridge Electric, LLC”

2.) Email to Heather Snow, Director

  1. Our local taxpayer’s association wants to get the total amount in leasehold improvements that were done to the premises at 1279 2nd st, CC/AOD offices during the last 5 years or so and are requesting this under the FOIA. We understand the contract was originally written up in 2013 and re-negotiated in 2016.2
  2. We’d also like to know if there was anything wrong with the offices.  Were there any problems or deficiencies during the period the County/Dept H&HS occupied the premises?3.
  3. The suggested $163k penalty seems excessive and we’re wondering how anyone can justify that amount?
  4.  A suggestion has come in that perhaps another agency could move into the premises…perhaps setting up a Drop In Center for Homeless Folks and/or a One Stop Access Point for Services and Referrals.
RESPONSE FROM HEATHER SNOW
“As of January 14, 2019, AOD and Mental Health have been integrated to become Behavioral Health. This decision was made primarily to assist in delivering more unified and comprehensive treatment services to the individuals we serve, who often face substance abuse and mental health issues concurrently. Additionally, in the past year, a new requirement to seek Drug Medi-Cal Certification has been placed on counties by the state and the infrastructure of an integrated department will be better able to take on the increased administrative burdens associated with this requirement. Because we had available office space within our other existing buildings where we were able to integrate AOD employees and programs, we eliminated the need for an additional rental, which created the opportunity for cost savings if we are able to negotiate an early termination of the lease at AOD and get BOS approval. Further information regarding the build-out for AOD is not available, as this was done by the private owner, not the county. Attached for your reference is the BOS Resolution for the recent integration to Behavioral Health.”
Are we any closer to resolution?
Not one word on leasehold improvements by either party.
No answer on building deficiencies by Heather Snow.
No response on how the $163,00 figure was determined by Heather Snow.
I put a call into Supervisor Gitlin since he was the one that pulled it off the consent calendar and asked for his comments:

Response by Supervisor Roger Gitlin regarding the AOD/penalty;

“There remain too many unanswered questions for this supervisor to render an inappropriate decision to terminate the 10 year (eight years remaining) lease.

1) Since no escape clause was written into this lease, what is the basis for a near $162,900+ payout to the landlord? What legal standard was utilized to come to this mutually agreeable buyout penalty?
2) Are our State and Federal DHHS funding partners aware of the use (or misuse) of these AOD funds to abrogate this lease? This Supervisor needs WRITTEN proof this impending termination agreement meets State and Federal guidelines and appropriate government protocol.
3) The owner of the buiding has every right to re-lease or occupy the vacated premises, per his wishes. This supervisor respectfully requests  improvement costs breakdown written into the 2016 Lease extension to accomodate the needs of the tenant (DHHS) as part of any settlement agreement. This Supervisor respectfully requests landlord intentions to re-lease or occupy the premises in question.
The Del Norte County Board of Supervisors is not a rubber stamp.”
Let’s get back to the “no escape clause” also known as a termination clause.  It’s standard operating procedure for legal documents involving real estate related matters.  Supervisors are afforded certain immunity from lawsuits and prosecution for these types of deals, but is County Counsel also afforded this immunity when it’s a clear case of incompetence?  Should our government attorney’s be held accountable and liable for damages when they are professionally incompetent? Yes the supervisor’s are supposed to read all documents, but it’s apparent they all missed it.
On the other hand, why terminate the lease if the premises can still be utilized?   Dave Slagle, foreman of the 2017-2018 Grand Jury had this to add to the conversation: 
  • Last year’s Grand Jury recognized a need and recommended a Day Reporting Center for both mental health and parolees. While the probation department did not seem receptive to the idea, it certainly could provide a great service to those in need of someone and somewhere to go in a crisis or to prevent a crisis. I’m sure there are lots of reason why it couldn’t happen, but it sounds like a great use for a county sunk cost.

This will probably be resolved at Tuesday’s Board of Supervisor’s meeting held at 10 am, January 22nd at the Flynn Center.  Will the taxpayer’s be screwed for a change, or will something more reasonable and workable be presented?

 

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