Thursday, May 22, 2008

Grand jury recommends closure of Mount Diablo Health Care District

Nearly all of the $1.3 million in property tax revenue generated over the last four years by the Mount Diablo Health Care District has gone toward administrative costs, leading the county's grand jury to recommend its closure.

In more than a decade, the embattled district has spent $5,000 on health-related services — a single 2007 donation to the California State University, East Bay, nursing program, according to a Contra Costa County grand jury report released Monday.

Since 1996, it has provided no hospital, physician or emergency medical services of any kind.

"(Since 2004), it has collected and spent over $1.3 million of taxpayer money, virtually all of which was used to pay for administrative and operating expenses — to perpetuate the District's existence," the report states.

Expenses have included legal fees, election costs, insurance premiums, post-retirement costs, professional fees and board member stipends, according to the report.

"The grand jury believes the Mt. Diablo Health Care District should immediately begin the steps to dissolve the district," the report states.

The 60-year-old district receives most of its revenue through property taxes (a budgeted $241,000 in 2008), along with an annual $25,000 subsidy from John Muir Health, according to the report.

If dissolved, taxpayers in the district's coverage area — Concord, Martinez, along with portions of Lafayette and Pleasant Hill and Advertisementnearby unincorporated areas — would see no drop in property tax payments. Instead, the revenue would be divvied up among other government agencies.

Mount Diablo first hit roadblocks in 1996, when, facing insolvency, Mount Diablo Hospital merged with John Muir Medical Center in Walnut Creek. The hospital now serves as John Muir's Concord campus.

A five-member elected board governs the district, which has no permanent employees.

Dissolution of the district could be started by a board action, petition of district voters or the county's Local Agency Formation Commission, or LAFCO.

Not so fast, says Dr. John Toth, district chairman.

"(The grand jury) hasn't considered all we've accomplished the last five months," Toth said, referring to a recent agreement to partner with John Muir Health to provide a community grant program within Mount Diablo's district.

The Concord doctor acknowledged the district's past problems, but touted a new direction.

"We put the sword back in the scabbard and decided to work with John Muir," Toth said.

Earlier this month, the district added $130,000 to its budget to prepare for an anticipated grant program with John Muir Health and $40,000 for a program administrator. With the new budget items, the district's 2008 annual budget increased to almost $330,000, while its anticipated revenue remained unchanged at about $266,000, according to the report. The grand jury called the new budget "unrealistic."

The district chair said the grand jury failed to incorporate an increase in property tax revenue it received this year.

After a 2007 consultant report, LAFCO directors reaffirmed the district's sphere of influence, but requested annual progress reports.

"They wanted to see what programs are implemented to improve the overall health for people in their district," said Lou Ann Texeira, LAFCO's executive officer. The next progress report is due in August.

In its recent history, the district's limited role has been providing blood pressure screenings and delivering educational brochures to the public, according to the report. Volunteers perform these activities.

Mount Diablo is one of three health care districts in the county, along with Los Medanos Community and West County. In 2003, the grand jury recommended dissolving all three.

"The West County Health Care District, through Doctors Hospital in San Pablo, continues to provide medical care to that district's residents. While the Los Medanos Health Care District no longer operates a hospital, it has successfully taken on a new, comprehensive, high-profile health care educational role on behalf of its residents," grand jury foreman Jerry Holcombe wrote in an e-mail.

During its investigation, the grand jury found no evidence of malfeasance by district officials.

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