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Building sale to ECMC at issue $5.1 million deal would shift 11 sites

No one knows whether Erie County Medical Center will close, stay open or merge. But that didn't stop the Giambra administration from advocating the sale of more county-owned buildings to the hospital Monday.

And it's a deal that's raising questions such as:

* Why did the administration wait until the eleventh hour to finalize the sale?

* Why was there only one appraisal of the property?

* Why was the county comptroller not involved in negotiations?

"I don't like this method of operation," said County Legislator Kathy Konst, D-Lancaster.

The deal, one of the last steps in making ECMC more independent, would give the hospital ownership of 11 county-owned buildings at and around the hospital and allow the county to lease back six of them for $1 a year.

The county would get $5.1 million in return.

"I like to grab cash whenever I can," County Attorney Laurence K. Rubin said of the money and the need for legislators to act quickly.

Lawmakers, many of them still leery of the original sale three years ago that spun ECMC off as a public benefit corporation, are upset because this deal came to them just days before their last meeting of the year.

And Giambra wants them to act now.

"So, the curtain's up, and there it is," Legislator John C. Mills, R-Orchard Park, said of the Giambra administration's surprise proposal.

And it's not just the timing that bothers lawmakers. They also wonder why the administration authorized only one private appraisal of the property when two or three is often the practice.

They also asked why County Comptroller Mark C. Poloncarz was not involved in negotiations with ECMC.

"I don't know if I was purposely left out, but I am disappointed I didn't have a chance to get involved," Poloncarz said Monday.

He said the key question at this point is whether the deal will save the county money over the long run and not just add $5.1 million in cash to its coffers this year.

That's a question Poloncarz said he can't answer so soon after seeing the deal for the first time last week.

Rubin said negotiations were accelerated when the county learned it might not get $5.8 million in unrelated revenue from ECMC that it expected this year. The two sides are battling over federal funding of medical care to the poor and whether that funding should be split between the hospital and the county or whether the hospital should keep it all.

To make up for that revenue, the county stepped up its negotiations over the sale of county-owned buildings to the hospital.

"We're closing a deal we made almost three years ago to improve our cash position," Rubin told legislators.

He said the deal, if approved, would allow the county to end the year with a $26.8 million surplus and add to the county's reserves an improvement sought by its credit rating agencies.

The county's control board, which can approve or reject the agreement, also voiced concern about the sale. Board members think the deal is being rushed through.

"There's not enough specificity there to make us comfortable," said Kenneth Vetter, executive director of the Erie County Fiscal Stability Authority. "There are an awful lot of questions, and this is not something to be rushed into."

The buildings the county wants to sell and then lease back are currently home to the medical examiner's offices, a community health center, public health and environmental labs and storage facilities.

In an unrelated matter, Vetter and board Chairman Anthony J. Baynes were scheduled to travel to New York City today to meet with credit rating agencies. The board wants Wall Street to assign a credit rating to the control board's borrowing capability.

The trip comes weeks after the board took the first steps toward adopting the power to borrow money on the county's behalf.

"There are no plans for the authority to do borrowing," Vetter said. "This simply gives us the capability in the event we have to."

e-mail: pfairbanks@buffnews.com

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