Not a done deal!
That was the message from City Council members on Wednesday as they attempted to ease concerns about the proposed sale of Gaylord Lakeview Homes (Lakeview Home, Oak Terrace and Heritage House).
More than 50 people filled the council chambers, many of whom were employees of Lakeview Home, Oak Terrace or Heritage House. A few of those employees addressed the City Council concerned about the proposal to sell all or parts of Gaylord Lakeview Homes.
Last month, the City established a committee to negotiate with Mick Montag and Dennis Hood. The two Mankato men have expressed interest in developing a senior housing campus in Gaylord along with purchasing Heritage House and Oak Terrace.
Montag and Hood developed a senior housing facility in North Mankato which also bears the Oak Terrace name. They are proposing a $5 to $6 million facility here. It would include 11 rooms for those with memory loss, 26 assisted living apartments and 18 independent senior apartments. The proposed site for the facility is on the south side of Lincoln Avenue – directly across from the Harvey Drive/Lakeside Acres area.
Chuck Klimmek opened the discussion Wednesday by updating the City Council on the negotiating committee’s progress. It was reported last week that the committee may possibly hire Pathways, a firm which could help the City determine a value for Gaylord Lakeview Homes.
Pathways, which has worked with Lakeview Home in the past, would conduct a study for a base fee of $6,000. As of Monday, the City had not made a decision on whether or not to hire Pathways, according to City Administrator Lonny Johnson.
Klimmek told The Hub on Monday that Montag is now willing to include Lakeview Home in a proposal. Initially, Montag had discussed purchasing only Oak Terrace and Heritage House. The City received a proposal from Montag Friday. It will likely be reviewed by the negotiation committee.
Klimmek said there is some doubt if the negotiation committee would be able to provide a recommendation to the City by June 21st, a target date for a decision. The committee may possibly have a report by then, Klimmek explained.
At its May meeting, the Lakeview Home board recommended that the City offer Gaylord’s entire health care campus (Heritage House, Oak Terrace & Lakeview Home) in any negotiations. In this situation, the City would not operate Lakeview Homes and the new company would manage all three facilities.
Mayor Doug Quast called Lakeview board’s recommendation “a best scenario.” He also recommends that the nursing home is included in any sale. Quast said he would like to see the facilities run by a health care management firm that knows about the health care business.
“If we don’t do something with the nursing home now, it will die.” That was the comment from Roger Bruellman, City Council liaison to the Lakeview board. Bruellman reported last month that Lakeview Home had lost approximately $77,000 through the first four months of 2006. In an attempt to offset the losses, 6-1/2 full time equivalent positions were cut at Lakeview Home on June 1st.
Bruellman would also like to see all three entities entered into any agreement made with the City. Bruellman believes a private developer is the way to go, but cautioned that the City needs to be very careful with an agreement. He is not in favor of a non-compete clause being proposed by the developers.
If the proposal by Hood and Montag is approved, Oak Terrace and Heritage House residents would have the opportunity to move into the new facility. It is not known what would happen to the current facilities which would then stand empty.
Some members of the audience said moving to a new facility was one of the concerns for residents. Bill Cowell, whose father lives at Oak Terrace, said there will be inconveniences for residents both financially and emotionally if they have to move. Cowell said his father is a resident at Oak Terrace and is “very comfortable” there.
Oak Terrace manager Sandy Schlueter asked council members if the City has looked at other options. Bruellman said there is a non-profit group interested in all three facilities. But, he explained that this group will not get involved until the City has made a decision on the current proposal.
Another Lakeview Homes employee believes the 54-bed facility being proposed is too large and it will eventually “go under.”
Sandy Domeier, director of nursing at Lakeview, reminded council members that there is no quick fix in the long term health care industry. She said the recent cutbacks at the nursing home “have started to compromise care.”
According to Council member Carl Wetzel, there is concern that the sale might be a “done deal” by June 21st. He said that is not the case.
“We are trying to do the right thing,” Wetzel said. “The Council concerns are for the citizens of Gaylord and the residents of the facilities.”