An analysis of a proposal to sell Frederick County's nursing and assisted living centers shows privatization would yield more than $12.4 million in financial benefit to the county over a four-year period.

The county posted the staff report online Friday along with Aurora Health Management's final offer to buy Citizens Care and Rehabilitation Center and Montevue Assisted Living. The Millersville-based company has agreed to pay $30 million for the 170-bed Citizens and 75-bed Montevue.

However, not all of the amount will arrive in county coffers, according to a financial analysis also released Friday.

The report shows that the county's broker, Marcus and Millichap Real Estate Investment Services, would receive a $750,000 commission after a sale.

In addition, the county would pay $650,000 to Aurora to accept the accrued leave of current employees at the two facilities and $833,000 for insurance, transfer and recordation taxes, as well as completing a parking lot behind the centers and returning grants and donations.

Aurora has offered to pay $1.9 million for the centers' accounts receivable. The company has agreed to allow Montevue residents subsidized by the county to continue living at the facility.

In exchange, the county would pay Aurora $10.7 million over a four-year period, with $3.5 million of that amount due at closing, according to the documents.

A staff financial analysis shows that the sale proposal now under consideration would leave the county about $5.8 million short of paying off the bond debt on the centers' new building.

However, selling the facilities would loosen up funds by putting the property back on the tax rolls and eliminating the subsidies needed to operate the centers. So, even after paying off the new building, the county would end up seeing a positive effect on its budget, according to the analysis.

The analysis also compares a sale with continued county ownership of the centers. The estimates show that from fiscal 2014 to 2017, the county stands to gain about $12.4 million by selling the centers.

The drafted asset purchase agreement included with Aurora's best and final offer stipulates that the company would apply to the Maryland Department of Health and Mental Hygiene to transfer state licenses for Citizens and Montevue away from the county. Although Aurora would head up the application process, the county would assist as necessary, the drafted document states.

The sale would require letters of approval from the Department of Health and Mental Hygiene and the Maryland Health Care Commission, the drafted agreement states.

The drafted purchase agreement does not commit Aurora to retain the employees now working at the facility, but Frederick County Commissioners President Blaine Young said an updated version requires the company to keep all staff at their current salaries.

The most recent version of the asset purchase agreement and the continuing care agreement for Montevue residents will be posted on the county's website Monday, a spokeswoman said.

Commissioners will discuss the proposed sale during a public hearing at 6 p.m. June 25 at Frederick Community College.

Follow Bethany Rodgers on Twitter: @BethRodgersFNP.

ON THE WEB

The county's financial analysis of selling the two facilities and Aurora's best and final purchase offer are available online at www.frederickcountymd.gov/ccrc-maloptions.

(24) comments

higgledy

The Young family have really set this county on a course straight into the crapper.

higgledy

Was this report first released on a Saturday? What a political maneuver, Blaine.

dbjanda1

Darth---Do I have to explain to you the difference between a legal citizen and illegal alien...Maybe you should turn in your patriotism card...Me

usgov

Tax payers shouldn't have to subsidize irresponsible elderly persons who failed to prepare for the enviable.

dbjanda1

Watson---If you Google Aurora Healthcare and Sabra REIT you'll see that Aurora sells nursing homes to Sabra and then leases them back...Look at Sabra's business plan on their dependence on government subsidies...Frederick County 'Welcome to the Club'...Me

dbjanda1

Darth---Is a CORE service of government to provide for legal citizens or illegal aliens ???...Me

darththevader

??? What are trying to say and what does it have to do with the topic?

japorciento

DarththeBlaineYoungvader: You know EVERYTHING that goes on in Winchester hall. Who prepared this financial "analysis"? It sure wasn’t our County employees. Who did it, Blaine? Aurora? Shabby. Just shabby. They should be fired and not allowed to buy our County Homes just because… Get it? Just because.

darththevader

Who are you asking what?

watson4sherlock

Assuming Blaine Young knows everything that goes on in Winchester hall is a reach.

rpkrauss

The financial analysis presented does not appear to tell a complete story. For example why was 2017 chosen as the cut off date I assume it is because that is when Aurora's obligation to terms expires. Yet if one looks at the page two cost to tax payers if the trend was extended to 2018 the county would realize a net gain of roughly $400,000.00. I don't have enough information to determine why this is but it sure looks like the county anticipates these facilities reducing costs and increasing income over the next five years I am sure Aurora does also otherwise they would not buy them. All other issues aside ( legal ethical and moral) this does not look like a good deal for the county financially.

teabiscuit

Really??? Are these guys using TERC math to determine the value of this sale to the county taxpayers?

smileyflowers

How much taxpayer money has already been spent to conduct this "analysis"? How is the broker tied to BY? Even I, who haven't followed this story all that closely, knows they have to be connected in some way, because, hey, afterall, this IS Frederick County where the Young(er) Brothers think they are all that.

rpkrauss

I doubt much was spent on this financial analysis given the poor quality of the work

watson4sherlock

Sometimes government does things like build and maintain roads that only a few people use. This is not good business sense because government is not a business. Government receives tax money to provide services to We the people. Government establised and regulated some services as monopolies because it was considered to be in the best interest of the people. Telephone and electrical services are examples. The Public Service Commission still plays an important role in these services.

A previous BOCC initiated the building of an expansion of the Nursing and Assistive Living facilities with the anticipation that they would countinue to be operated by the County. The current BOCC advocates for a conversion of public money to private use by selling the facilities to a private owner. It is not the BOCC but We the people who own these facilities. We the people gave our proxi to these elected officials to act in our stead but we did not transfer our holdings to their ownership. The County should retain ownership of the facilities even if it means a financial expenditure from the tax payers because it is a service to We the people. Perhaps the BOCC would like to entertain a vote on the matter.

darththevader

We the people don't expect government to provide every service just because.

The function of government is to provide core services. It's not feasible to have private police forces, private road systems, etc. Maybe you want government quick oil change places and grocery stores too. After all they are services.

watson4sherlock

Frederick County has been providing the Nursing Home and Assistive Living services for decades. The prior BOCC determined it was desirable to continue providing this service so it expanded the facilities. All of a sudden the current BOCC decides it wants to quit providing these services to We the people. The current BOCC failed to seek the peoples opinion in this matter. Could the County similarly decide it just doesn't want to maintain roads any more? The people need to have input into this decision. A call for a vote is in order.

watson4sherlock

Okay we've heard the hard sell. Where's the soft sell? Why will Aurora Health Management be a good choice to manage the facility? Currently they manage five facilities in Connecticut, one in New Hampshire, and one in Maryland.

Aurora Senior Living of Manokin is a premier skilled nursing facility in Princess Anne, Maryland. We provide rehabilitation services and around the clock skilled care in a comfortable and friendly environment. You can see some very sterile photos at their website http://auroramanokin.com/.

Google maps says it's about a 200 mile, four hour ride from 10 East Church Street, Frederick, Maryland, to 11974 Edgehill Terrace Road, Princess Anne, Maryland. Perhaps a committee of citizens should take a ride and take a look.

watson4sherlock

The drafted purchase agreement does not commit Aurora to retain the employees now working at the facility, but Frederick County Commissioners President Blaine Young said an updated version requires the company to keep all staff at their current salaries. Really? Mr. Young is renown for his honesty and integrity?

I'm suppose to look at the numbers and make a business decision. Is the County changing a $1.9 million dollar debt for a $6 million dollar debt in 2014? Hasn't the 2014 budget already been finalized? Shouldn't the Broker's Commission, Employee Leave Transfer, Recordation/Transfer Tax, Rear Parking Lot, Return of Grant & Donations, Five Years of Insurance, and Cash Shortfall from Escrow Requirements be included in the list of negative impacts? If it wasn't for the sale the County wouldn't be paying them.

So who will be getting these return of grants and donations? Somebody who needs them to fund a campaign? The plot thickens.

fnfn

The employees may not lose their jobs and pay, but do they lost their investments in their pensions? If they do, how is the county going to compensate them for their losses? How will they be made whole?

dbjanda1

Would Blaine sell the nursing homes if the residents were elderly developers ???...Me

president8444

Sell now,many counties out of the nursery home business.Use some of money to pay for wefare patients to the new owner.

Crustybachelor

We're talking about the elderly here...not shrubbery.

armillary

He assures us no one will be tossed
and no employee's job will be lost
but Blaine wants an end to this sharing
and our tradition of caring
and he doesn't care how much it costs.

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