As Country View sale nears, sale price falls again

Dec. 27--WATERLOO -- Black Hawk County will get less than expected from next week's sale of the Country View care center.

Members of the county Board of Supervisors voted 4-1 Wednesday to approve the documents required for the scheduled New Year's Eve closing on the sale of the long-time county-owned nursing home and mental health care center to a private buyer.

The board also voted 4-1 to place another $250,000 into an escrow fund for the new owner to use for future repairs to the building on Dunkerton Road north of Waterloo, essentially lowering the amount the county will pocket from the sale.

Supervisor Chris Schwartz voted against both measures, noting he was opposed to the sale, the county was getting less than originally promised from the transaction and he was disturbed about what he was hearing regarding the buyer's treatment of employees.

"The company chose to wait until days before Christmas to let people know whether they were keeping their jobs or not and to break the news of the big pay cuts and that people are receiving massive increases in their insurance premiums," Schwartz said.

"It's really unfortunate they chose to wait so long and break the bad news at such a bad time for families," he added.

Pritok Capital, of Skokie, Ill., bid $5.6 million when the nursing and mental health care facility, which was running huge budget deficits under county ownership, was put on the market in May.

But the supervisors agreed to lower the price to $4 million after the state slashed Medicaid reimbursement rates for some residents at the care center, which Pritok claimed devalued the center after the original bid was provided.

The supervisor voted in November to put $400,000 into an escrow account for Pritok to make repairs to the facility. This week's action added another $250,000 to the escrow, which lowers the county's actual profit from the sale to $3.35 million.

Eric Johnson, an attorney representing the county in the sale process, said the buyer initially sought $800,000 more for the escrow after finding $1.6 million in capital needs there.

"They had an architect-engineer group go through the building and noted improvements that they would like to make," he said. "A very small portion was immediate-type improvements and others were more long-term.

"As we pointed out to them, they knew all along this was not a new building, and some of those were just long-term capital expenditures that you know you're going to have to deal with over time," Johnson added.

The supervisors did vote unanimously to approve a resolution thanking the current county employees for their years of service and dedication to the residents of the facility.

Supervisor Craig White said the list of current employees includes two with more than 40 years of service and 10 with more than 30 years at Country View.

Those employees will be laid off as county workers Dec. 31 and had to reapply for jobs with the new operator, Black Hawk Nursing and Rehabilitation LLC, which Pritok assigned to run Country View.

County Human Resources Director Debi Bunger said approximately nine positions were not being retained by the new operator. Country View had employed roughly 170 staff members earlier this year.

"As with other employees who have been impacted by a reduction in force in the past, information is provided to them concerning their options under county policy and applicable collective bargaining agreements," Bunger said. "We encourage them to sign up for our job alerts and apply for openings they are interested in within Black Hawk County."

Schwartz and a representative for the union representing the Country View employees through Dec. 31 said they've heard concerns about pay and benefit cuts for those who are being retained.

Mike Scarrow, business representative for Public, Professional and Maintenance Employees Local 2003, said he did not have firsthand knowledge of the pay and benefit levels Black Hawk Nursing and Rehabilitation was providing.

But Scarrow said some employees have told him "insurance is going up considerably and their wages are going down."

A phone call and email send to Pritok Capital's home office were not returned Wednesday. As a private employer, the company's pay and benefit information are not a public record.

During the sale process, Pritok officials indicated the health insurance benefits likely would change significantly but said wage levels would be competitive with other nursing homes in the Cedar Valley.

Country View is licensed for 134 skilled nursing beds and has a 34-bed intermediate care facility for intellectually disabled clients. The county's sale contract does not allow Black Hawk Nursing and Rehabilitation to displace any of those residents against their will.

Supervisors decided to sell Country View after it exhausted some $4 million in county reserves it was given to operate as an enterprise fund. The board transferred another $1.5 million into Country View's coffers last year to keep it afloat and agreed to raise taxes again this year to maintain services there.

Supervisor Frank Magsamen said those decisions were all designed to maintain care for the residents.

"I think the decision to turn this over to a private (business) for them to provide quality service is the responsible thing for the county to do," he said. "Long term I think it's best for the residents at Country View."

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