This old barn
Published on October 9th, 2002
STONEHAM, MA - The $1.1 million dollar proposal for an Adult Health Care facility in Stoneham will go before the voters at the Special Town Meeting on October 24.
Town Administrator Dave Berry is in favor of the proposal and said the financing, which must be made possible in part by a state grant, holds the fate of the proposal. Berry was impressed with the research performed by Joseph Slavet, the grant writer for the proposed facility, concerning the adult day care needs of the community. Slavet held a public meeting last week concerning the $700,000 state grant. “He has identified the need that is obviously growing for this type of facility,” said Berry.
Slavet was on vacation this past week and could not be reached for comment.
Article 2, of the Special Town Meeting Warrant calls for the appropriation of borrowed funds, after grant funding is pursued, for the renovation and furnishing of the Senior Center Barn into the Stoneham Adult Day Health Center. Another $400,000 needs to be raised for the financing of the project. Presently, grants and other sources of funding are being pursued for the additional monies. The $700,000 from the state grant and $400,000 makes this project a million-dollar plus endeavor.
Berry said that without the state grant for $700,000, the day care proposal is moot. At the public meeting last week, resident John DeGeorge said the Stockwell Fund, which is being pursued as a possible funding source, limits its use to Stoneham residents.
The Stockwell fund is a trust fund account donated to the Town of Stoneham for the medical care and well being of Stoneham residents.
However, the proposed Adult Health Center would be open to ten neighboring communities as well as Stoneham, bringing into question, whether or not the fund will be able to help finance this proposal. The Finance and Advisory Board concurred with DeGeorge’s opinion and have sought clarification concerning the Stockwell Fund.
Presently the town’s legal counsel, Attorney William Solomon, is researching the Stockwell Fund to see if it is a viable source of funding for an adult day care center. As of Monday afternoon, Solomon did not receive confirmation or a denial from the Stockwell fund.
DeGeorge questioned Slavets timing of the public meeting held last week at 10:30 a.m., a time that is highly inappropriate in DeGeorge’s view.
“This meeting should have been held at a time when the residents who may have to pay for this project, are able to attend,” said a dyspeptic DeGeorge.
DeGeorge said Slavet held the public meeting as required for an article on the Town Warrant.
Whether the proposed Adult Health Center is a town owned/run entity, or if it is contracted to a third party such as a non-profit organization, is yet to be determined. Slavet apparently is reviewing what recommendation to make to the town on who should run the organization.
DeGeorge believes that the town should stay away from such a project if it doesn’t add to the town’s coffers. He questions the validity of a non-profit organization running the center. Without knowing the finances in further detail, Berry said that such an organization might best be operated by a contracted organization.
DeGeorge would like to see any revenue realized by running the center to go into the general fund, providing relief to the over-taxed Stoneham residents. An Adult Health Center that does not realize a profit, in his view, is an unwise venture for the town in these uncertain fiscal times.
According to a letter to the Board of Selectmen from the Finance and Advisory Board, they question whether or not it is wise for the town to solely bear the burden of $400,000 in additional debt to create an Adult Health Center with 60 slots that will serve at least ten cities and towns. The letter, signed by their chairman, Jim Grayson, said the bond will add $40,000 to the town’s annual expenses, and start-up costs could run from $50,000 to $100,000 before any profit is realized.
Compared to similar facilities in neighboring towns, the proposed $60 fee per day for the Stoneham center, is significantly more than Peabody’s which is $40 per day or Lexington’s $45 per day.
The Finance Board’s letter also points out that the Lexington Adult Health Care Program operated for five-years before it broke even. It also stated that the Saugus town manager closed its facility due to its first year operational loses.
Before suggesting a more complete marketing survey in their letter, the Finance Board also said that revenue projections are heavily based on Medicaid reimbursement rates of $37.88 per day, a cost that the state is trying to reduce.
DeGeorge is concerned about the funding for the project. He says that if the town borrows $400,000, the approximate costs of $40,000 a year for 20 years is too much for the town to bear. Add that to the costs of operation for the first four to five years, and residents are facing a sharp tax increase for an Adult Health Center that won’t exclusively serve the sons and daughters of Stoneham.
"Because these are uncertain economic times, the Finance and Advisory Board vote against this article,” said Finance Board member John Bowen.
Bowen said that industry insiders tell him that businesses like this must be relentlessly promoted just to break even. “This is not a money maker for the town,” said Bowen. “It has a high degree of uncertainty.”
One thing that Berry, DeGeorge and the Finance and Advisory Board agree on is that with the stringent budgets state-wide, this is the worst time to borrow money or raise taxes.
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