Brooklyn officials denounce SUNY’s revamp of LICH RFP

Levin: ‘SUNY decided to go rogue’

January 30, 2014 By Mary Frost Brooklyn Daily Eagle

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Elected officials in Brooklyn joined community groups and unions in denouncing SUNY’s announcement late Tuesday that it is “reopening” its Request for Proposals (RFP) to sell Long Island College Hospital (LICH) — but only to those bidders who already participated in the initial round.

“First, SUNY tried to shut down LICH altogether. When we stopped that, SUNY then attempted to push through a flawed process. Throughout this process, SUNY has acted in bad faith— making deals behind closed doors, violating good-government rules, and keeping the community in the dark as it seeks to rid itself of LICH,” Public Advocate Letitia James said at a press conference on Henry Street in Cobble Hill on Wednesday. “We’re sick and tired of it. Open process? Open to no one.”

SUNY said that those who previously put in a bid would have until February 3 to tweak their offers.

Allowing the previous bidders to revamp their bids would “enhance the openness, transparency, and effectiveness of the process,” SUNY said in a release, adding that firms will be asked to make public the terms of the proposals prior to an award.

Officials, community groups and unions, however, called the rejiggering a “gimmick,” and demanded a new, open RFP process.

“The community has not been able to give input throughout this entire process and yesterday’s RFP announcement was more of the same, Councilman Steve Levin said. “Just like before, SUNY decided to go rogue.”

“Over a year ago, our community gathered right here to say that LICH simply cannot be turned into a luxury condo deal — and we’ve remained united, and kept fighting, ever since. It’s time for a new, fair RFP process that will solve the crisis at LICH and ensure the best possible outcome for healthcare in Brooklyn,” said state Senator Daniel Squadron. (D-Lower Manhattan, Downtown Brooklyn)

“SUNY is crying poverty but spending hundreds of thousands of dollars on five big city law firms and hundreds of thousands of dollars on television ads,” said attorney Jim Walden of Gibson, Dunn & Crutcher, representing six community groups and others in the year-long battle to keep LICH open. He added, “If you think risking contempt in court is the price you have to pay to get your real estate deal done, I hope Justice Johnny Lee Baynes gives you a terrific case of sticker shock.”

More than a dozen SUNY officials and board members will be facing contempt charges before state Supreme Court Justice Baynes on February 11 for their actions in trying to shut down LICH.

Advocates for LICH say the RFP process was shrouded in secrecy and slanted towards real estate developers, and the “redo” is more of the same.

“How many people remember the movie ‘Groundhog Day?’” asked Councilmember Brad Lander. “You wake up over and over and the same thing happens. More than a year ago, SUNY made illegal efforts to close LICH.”

Lander said that one important change to the RFP this time is that “people who chose to re-respond also have to waive all claims. They’re saying, ‘We know the process is illegal, and you can’t sue us.’ It’s one more sign of everything that is wrong with this process.”

“LICH is a lifeline for the communities that I serve, particularly Red Hook, which has a large population of public housing residents and hardworking immigrant families. A recent community health assessment in Red Hook found that one in every four Red Hook residents is diagnosed with asthma,” said Councilmember Carlos Menchaca. “ For my Red Hook community, every second it takes to respond to an emergency matters.”

Councilmember Corey Johnson (Greenwich Village, Soho, Chelsea) said, “We lost St. Vincint’s three years ago – a 161-year-old hospital. The loss is unmistakable for the community. LICH and Interfaith [Medical Center] are about putting people and health over profits. As the Council’s Health Committee chair, I promise to take this battle full on.”

“LICH has been our community hospital for 150 years. Reissuing an RFP that is only open to those who initially responded is a sham process,” said Assemblywoman Joan L. Millman. (52nd AD)

Jill Furillo, Executive Director of the New York State Nurses Association, said in a statement, “”We agree that SUNY’s Request for Proposals to find a new operator for LICH was deeply flawed from get-go and we support the call by our community and elected allies to fix that process. From the beginning, SUNY has acted without transparency and without regard for community needs. The community deserves a voice in decisions that impact access to healthcare.”

Before Wednesday’s press conference, eight elected Brooklyn officials issued a joint statement saying, “SUNY’s process has fallen far short, by any reasonable standards, and their latest last-minute, rushed, non-collaborative revision to their flawed RFP process is more of the same. It limits the bidders to the handful of real-estate developers who chose to reply to the same RFP SUNY released in July, after which two separate State Supreme Court Justices ruled that SUNY failed to follow proper procedure or appropriately consider the community health impacts of LICH’s closure.”

The officials offered their own detailed suggestions for reissuing the RFP, which may be found below.

Late Tuesday, Jeff Strabone, spokesperson for the Cobble Hill Association, called the RFP redo little more than an effort to “make their condo proposals look less repugnant.”

On July 17, 2013, SUNY issued an RFP “to offer health care services at the Long Island College Hospital (LICH) campus, or in the community proximate to LICH consistent with the health care needs of the community, and to purchase the LICH property, plant, and equipment.”

SUNY spokesperson David Doyle told the Brooklyn Eagle that the original RFP was well publicized and open to all bidders. “The reopening allows bidders to partner with anyone they want. So from day one there was, and there continues to be, ample opportunity for any interested parties.”

SUNY has not revealed the identity of the bidders, other than the winning developer Fortis Property Group, though at one point it said that seven organizations had made it to the final round.

Allowing the existing bidders to tweak their proposals would allow Fortis, which plans to build condos on the property, to replace ProHealth medical group with NYU Langone Medical Center for the health services fraction of the proposal.

Brooklyn Hospital Center, which itself hopes to develop the property with apartments, had protested when SUNY had allowed Fortis to change the health provider to NYU after the RFP process had been completed.

Both Fortis and Brooklyn Hospital Center said they would provide ambulatory medical services, but no inpatient hospital.

According to Crain’s NY, a proposal which included a full-service hospital was made by the Chinese Community Accountable Care Organization (CCACO) of Manhattan, in collaboration with the Eastern Chinese American Physicians IPA, and Brisa Builders Corp. CCACO describes it self as “a physician-owned and operated accountable care organization” which is geared towards meeting the specific needs of the Chinese community.

In a letter to all firms that submitted proposals, SUNY said it would allow “additional interested parties” to participate in the evaluation process. “Therefore, you are invited to resubmit your proposal, revised to reflect your final and best offer, which may include additional or substituted collaborators and enhanced health care service and financial terms.”

The letter goes on to say, “SUNY understands that many parties have called for some form of comprehensive health care at the LICH campus, including perhaps an off-campus hospital emergency department and/or a federally qualified health center or other clinic providing substantially the same services for self-pay or low pay patients. In addition, SUNY calls to all proposers’ attention that the Petitioners in the pending litigation have expressed a preference for a full service hospital at that location.”

SUNY said in the letter that proposals will receive higher consideration “to the extent that the proposed purchase price(s) of any parcels of real estate involved in the proposal are in line with or supported by the appraised values of the Property proposed to be purchased.” SUNY said in the letter that appraisals had come in from $228 million to 278 million.

“SUNY and the Board have always advocated for a real solution to the crisis at LICH that benefits the community while allowing SUNY to return to its core academic mission in Brooklyn and across the entire State of New York,” said Board Chairman H. Carl McCall.

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Brooklyn Elected Officials Statement on Long Island College Hospital (LICH):

On Wednesday, January 29, Congresswoman Nydia Velazquez, State Senators Daniel Squadron and Velmanette Montgomery, Assemblywoman Joan Millman, Public Advocate Letitia James, and Councilmembers Brad Lander, Steve Levin, and Carlos Menchaca released the following statement:

“As federal, state and city elected officials, we stand together against SUNY’s latest attempt to turn LICH into a luxury condo deal. As we have consistently said, SUNY, Governor Cuomo, and the NYS Department of Health must support a new, more open, and expedited process to solve the crisis at LICH — in order to ensure the best possible outcome for Brooklyn.

“Of course we would strongly prefer to maintain a full-service hospital on the site. Nearly everyone in the community would, and it is what we have been fighting for, for over a year. We also recognize the possibility that even under a fair process, this option may not be proposed. But the only way to know — the only way to have confidence that we are achieving the ‘best possible outcome’ for the community — is through a fair and appropriate process.

“SUNY’s process has fallen far short, by any reasonable standards, and their latest last-minute, rushed, non-collaborative revision to their flawed RFP process is more of the same. It limits the bidders to the handful of real-estate developers who chose to reply to the same RFP SUNY released in July, after which two separate State Supreme Court Justices ruled that SUNY failed to follow proper procedure or appropriately consider the community health impacts of LICH’s closure.

“The RFP is burdened with hundreds of millions of dollars in questionable liabilities; designed to undervalue healthcare and overvalue luxury housing; requires developers to offer the fully appraised value of the property (even though this assumes an entire conversion to residential use); and now even requires bidders to waive all claims they might have arising from the process (an apparent attempt to protect themselves from the consequence of this flawed process).

“If SUNY and the Governor genuinely want to achieve the best possible outcome, then they will do it through a real expedited RFP — which could conclude in weeks, not months — that includes the attached criteria. If they did, we would be prepared to participate in the process, and to work together to achieve the best possible solution.

“Let’s be clear, today’s crisis at LICH has been created by SUNY’s failure to work collaboratively, or within the law, to find a solution for more than a year. Yesterday was more of the same, and will only lead to more costly delays in finding a solution.

“If SUNY had worked collaboratively from the start, the State would no longer be saddled with LICH’s deficit today. The extra months and millions in financial losses were not created by the community by insisting on preserving health care services; they were created by SUNY by refusing to work together toward a better outcome.

“Brooklyn healthcare deserves better. Only an open process, with revised goals and criteria that prioritize healthcare, and provide genuine community representation in the decision-making process, can ensure the best possible healthcare outcome.”

RFP Criteria:

The elected officials have set forward the following criteria for an acceptable RFP process:

1. Open to all respondents (or, at a minimum, affords all respondents to both the RFEI and RFP the opportunity to respond, with new partners). If we are going to have confidence that this process will yield the best possible result for our community, under the current circumstances, then it must be open to a wider range of bidders than the handful of real-estate developers who chose to participate in SUNY’s early, highly-flawed RFP.

2. Selection criteria:

I. Financial contribution to SUNY only up to a pre-negotiated amount that fairly reflects SUNY liabilities. This must not be the full appraised value of the property, which is based on an assumption that the entire property is converted to “highest and best” (i.e. market-rate residential use), and therefore assumes the elimination of healthcare services.

II. Quality and quantity of healthcare services provided must comprise the majority of the competitive criteria.

III. Record of partnering with communities, meeting obligations and providing high-quality construction/management.

IV. As part of any housing proposal, the proposer should describe how their development plans would address affordability, neighborhood context, sustainability, open space and other factors relevant to a large-scale development.

V. Financial and practical feasibility.

3. Minimum required healthcare services:

I. a smaller full-service hospital or, at a minimum, a facility that can receive 911 ambulance service, with 24-hour a-day care [A facility that can receive 911 ambulance service must have all care facilities on site.]

II. radiology

III. pediatrics

IV. dialysis

V. continuation of school-based health clinics

VI. Medicaid accessible primary and preventive care

4. Selection committee must include meaningful (i.e. able to have an impact on RFP substance and selection) representation made up of the community, local officials, and the City.

5. Significantly expedited process.

6. Continuous emergency service through RFP and transfer.

7. Deed restrictions on property to ensure use approved.

8. Respondents should not be required to “waive all rights” under the RFP process, if they have legitimate claims against SUNY after the process has been completed. This is highly unusual, and suggests that SUNY recognizes their process has been flawed. We need the fullest range of bidders to ensure the best possible outcome, and cannot afford to limit the bidders willing to participate in a rigged process.