Update Jan. 15, 2009 - This subject was transferred to a separate page on this blog, which will contain future updates. You can read the "page" HERE.
This topic was covered on the local WLBE 790am Radio Show Featuring Ralph Smith & Fred Johnson
Fred was running the show. Ralph was on a hunting trip.
North Lake County Hospital Property Tax District - Where does the $12-million Go?
Note: We intend to revise this document with any verifiable facts from any party and move it later to a separate page on this blog so it is a living document. If any reader has new facts to provide an objective overview, I will verify and add them.
vj
Marilyn Bainter called to the radio show about the North Lake County Hospital Taxation District (NLCHD). District is a 1 mill property tax on North Lake County property to provide funds to the two local hospitals, Leesburg & Florida Hospital/Waterman. Thus, an owner of a $400,000 valued house would pay $1 (i.e. 1 mill) per $1000 valuation, or $400. Someone with a business property valued at $2-million would pay a tax of $2000 to be paid to the hospitals.
Here is the most recent 2004 Bill HB 1609 that expanded the District to Florida Hospital/Waternman.
Marilyn was just elected to the Board and received 43,402 votes vs Carpenter got 30,875. She is aiming to identify where the funds go and reduce the tax.
According to Marilyn Bainter: Two board members were appointed to fill unexpired terms (Bowersox and Talley). Gaylord was elected by default. 1 new member (Beyers) was elected by default. Ken Carpenter and Marilyn Bainter are the first (real) elected members in contested elections in the last 18 years. The names appeared on the ballot so the voters could vote. It was a 3 person race with the incumbent Richard Paul being defeated.
The Board meets annually in January to elect officers and has 2 public tax hearings in September. The tax is already set at 1 mill so it is a very uneventful.
Wording in the District formation legislation is VAGUE, thus doesn't clearly specify purposes of the funds and how they are to be used.
The tax was originally created many years ago to help build Leesburg hospital, then expanded to include Florida Hospital/Waterman.
The District formation law set property tax at 1 mill, according to the existing District Board. They say they don't have authority to reduce it.
We are 1 of only 10 counties with such a property tax out of 67 counties in Florida. Thus 57 counties do not have such a hospital tax district. Doesn't exist in any of the surrounding counties. Not in OC, Osceola, Sumter, etc. You can see a list of Florida Districts HERE. (This list may not be complete)
The board meets at 6pm on 20th of Jan at Lake County Water Authority (LCWA) office in Tavares at 107 No. Lake Ave. at Main St. - about two blocks from HWY 19 and Main. Marilyn asks voters to attend to show support for some changes needed. (see my comments below - vj).
Legislation is very vague about how money is to be used. It just says funds are to be used for “continuous hospital services”. The hospital representatives will say it is for indigent care, but wording is too vague, and they cannot provide proof because according to Marilyn Bainter, neither hospital has separate accounting records or checking accounts for NLCHD tax proceeds, thus there is no audit trail. Thus voters don't know what the funds are being spent for. Anything said by the hospitals is hearsay.
Frank Gaylord is the Chair of the District.
Is Current Tax Rate Millage rate of 1 mill Justified? - Fred says the hospitals made $28-million in profit last year, thus tax should be cut in half. "We need the taxpayers to ask County Commissioners to request State legislators to introduce legislation to allow modification of law to allow the District Board to reduce the tax.
Per Fred: I can't understand why the legislators don't take action. Carey Baker, Alan Hays, Marlene O'Toole are our primary legislators.
Readers can call Marilyn Bainter for more info at 483-0770.
Fiscal Ranger comments about the Hospital District
I was at a recent meeting with Marilyn Bainter regarding the Hospital District, and these items were not covered in the notes above.
- Commingling of Tax Funds and Lack of Evidence to Explain What the Tax funds were spent on: Marilyn and some other activists have been unable to get the hospitals to provide financial records showing where the $10+ million in funds are going. The hospitals are collecting their checks from the County (over $5-million for each hospital) and commingling the funds in a general checking account, so there is no audit trail. This needs to be changed and the board or citizens need to request an a Florida State Auditor General (AG) audit of where the funds went. Such requests have to go to legislators, who then make the request to the AG. This is another area where you can tell whether the legislators are supportive of Bainter's efforts for transparency. If they balk at this, it indicates they are backing the Hospitals rather than the voters.
- Is Legislation Needed to Allow Reduction of the 1 mill Tax? - The definition of whether the current Hospital District Board has the right to modify or reduce the 1 mill tax to a lower amount needs official State review. Hospital supporters claim the formation law says only 1 mill can be taxed, and the District Board does not have the right to reduce it. They can vote for NO tax, but not anything in between.
- Referendum needed to Approve Continued Taxation: Currently, the voters have no say in approving the 1 mill tax. The District's Board has the power. There needs to be a referendum to see if voters really want the tax when according to Marilyn Bainter, both "non-profit" hospitals in North Lake County (Leesburg Hospital & Florida Hospital/Waterman) earned "profits" totaling $28.4-million in 2008. The original reasons for the tax, which were to help build Leesburg's Hospital, seem to not exist anymore. You can see the 2004 legislation HERE that defined that the funds are for "health care" without any more specifics. However, according to Marilyn, the official stated purpose is “continuous hospital
services”, which is also vague.
- Possible Illegal Tax of North EAST Lake County - The tax district was originally created through a voter referendum for North West Lake County and Leesburg Hospital. Then later, the North East had a District but never voted on a tax, was combined with the North West District and the residents of North East Lake County were subject to the tax without any referendum. The State Attorney General needs to issue a ruling on this issue. It may be possible that the North East residents have been taxed illegally if state law says that they should have been able to vote on the taxation, and they never had the chance to vote on it.
- Legislative hearings & New "Local Ruling" Legislation Needed to Allow Hospital District Board to Reduce District's tax millage rate - At a recent hearing I attended that was held by five Lake County based State representatives for local officials and citizens, Marilyn Bainter asked them to initiate a local law to allow the District to reduce the tax millage rate. State Senator Carey Baker chaired the meeting, and pushed off public input from Marilyn and others until the end of the meeting and all reporters had left. None of the legislators committed to initiate the requested legislation. Magically, someone had warned the two hospitals to send representatives and they were allowed to talk, but anything they said could not be proved since there are no direct audit trails to show where the spending was made. Note: It is possible that Ocala area State Rep. Charles E. Van Zant may be initiating this - I have a call in to his office.
- Need to Request A District "Special Meeting" - Due to the sunshine laws, these issues cannot be added to the agenda of the Jan. 20 Board meeting. The board only meets twice a year, so Marilyn plans to request another "special meeting" in one month to have these items on the agenda. Attendance at the Jan. 20 meeting is important so the Board knows there is support for another meeting.
- Need for a Visible District Website with More Documentation - Until now, the District has operated invisibly to the voter. They need a website with all information on it, including meeting agendas, minutes, meeting calendars, financial statements, audit reports, budgets, check register, contacts, background and affiliations of all board members (most were appointed and not elected). Financial records should include both expenses of the Board, as well as those from both Hospitals. All tax revenues should have an audit trail over where they were spent.
- Efforts to Recover Expenditures - The Hospitals say that funding was needed for indigent care. However, what controls exist to ensure the hospitals DO initiate collection actions to recover the expenses. Or are they just passing off the costs to the District without any collection efforts?
- Legislation Defining Indigent Care Costs to be Absorbed by Non-profit Hospitals - I am sure there is legislation that says the hospitals must provide care without consideration of ability to pay. However, why can the hospitals in 57 counties absorb the cost, but not the local hospitals - instead expecting the Lake County residents to pay for a service not required of residents in other counties? If the hospitals are non-profits, why do they show a profit - what are the profits being used for? Waterman hospital is part of a much larger hospital chain, and are local taxes being used for Waterman & LRMC's big advertising programs?
Actions Planned by FiscalRangers - we stand for transparency in government spending, and there isn't any related to this District. There is no website and Marilyn Bainter has not been able to obtain adequate documentation for how the District funds are spent.
1. Attend the Jan 20 meeting and future meetings.
2. Contact all the related State legislators and get their stand on the proposed legislation that would allow a variable rate, AND requesting an Attorney General opinion on a) Whether the Board, using existing legislation, can reduce the tax, and 2) Whether the NorthEast residences are being taxed illegally.
3. Request evidence to support an audit trail of the spending, and continue until it is provided.
4. Establish a separate "page" on this blog just for the North Lake Hospital district (by this weekend) - there is NO website for the District.
5. Send out press releases to the press to encourage coverage at the meetings and in articles.
6. Support Marilyn Bainter in her actions to achieve transparency, public choice on the millage rate, better expense documentation and reform for the District.
vj
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Background Information:
Law Firm Contact: Vose Law Firm LLP representing your agency, please call us at
407...
or 1-866-789- VOSE. 324 W. Morse Boulevard, Winter Park,
Florida 32789
Contact for District (accounting firm) - Patricia Sykes-Amos 352-383-6300 Mt. Dora
Questions of Sykes-Amos: Based upon our discussion 1/16/09 - vj
- What is website -is there one?? No - no website
- Get copy of agenda - attorney will send me one
- Roster of officers, contacts and affiliations - Patricia will send me one and I will post it on the page for this issue.
- Contacts for two hospitals receiving funds (or are there more?) - Will get that also
- Obtain copy of audited financial statement - They are available at 15 cents per page - I will look at Marilyn Bainter's copy.
- Discuss issue of commingling - The two hospitals don't provide direct audit trail - they have audit reports supplied to District Board that verify that more is spent on "charity" or indigent care than they receive from District. Thus, hospitals have no incentive to control such spending, and no research to ensure they are taking any collection actions against recipients of care.
- Any legal analysis of addition of North East Lake County into District without referendum? - The districts were combined in 1991 and changed from "dependent" status where County maintained books, etc. to "independent" status where the District pays the accounting firm for services. No physical office or website is used.
- Better details on what funds are actually spent on... We would have to examine the hospital record keeping and walk through their system. A big issue to me is that getting $5-million plus without any service requirements, etc. means the hospitals can use it without any business controls. They could be allocating full rack (retail) rates and excess overhead to each case to pay for expensive machines, etc. and the taxpayer is absorbing the cost. I would want to confirm that medical service charges to the program were the same as those negotiated with private insurance plans.
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