The Argument for Not Killing the Valley Hi Tax

Found this in the Valley Hi Operating Board minutes for December 2nd:

Tax Levy Abatement and Potential Long Term Impact

Ralph Sarbaugh, Tom Annarella and Peter Austin at the Public Health Committee 2015 budget hearing for Valley HI.

Ralph Sarbaugh, Tom Annarella and Peter Austin at the Public Health Committee 2015 budget hearing for Valley HI.

[Tom]¬†Annarella provided the Board with Valley Hi’s official position document that was shared with staff following the County Board’s vote to abate the Valley Hi tax levy in FY2016.

Mr. Austin spoke about the process that was followed by the County Board and some of the unknowns and challenges that would be encountered in FY2016 and as the budget was prepared for FY2017.

The implications of the tax levy abatement and the process and timeline to reinstate the tax levy before it was lost permanently were also discussed.

Mr. Annarella provided the Board with a simple fund balance utilization chart for review.

Mr. Annarella detailed some of his concerns for the Board noting:

  1. State Budget and resulting Medicaid rate cuts
  2. Potential loss of Medicare to Centegra when they build their proposed 90 bed rehab facility
  3. Rising costs to provide care and unfunded mandates
  4. Union contract negotiations and related increases in costs 5. Unforeseen expenses 6. Not having the levy re-instated in FY2017

Mr. Annarella explained to the Board that over the coming months, as discussions about finances occur, there would be some possible things that would need to be considered to preserve the reserves and the operation for as long as possible, including:

  1. Changing the case mix
  2. Changing the private pay resident rates
  3. Charging private pay residents for ancillary services and supplies
  4. Forgoing capital improvement plans
  5. Looking at alternative revenue streams

Mr. Annarella explained that in the short-term, he and management staff would be conducting the following:

  1. Start looking at all considerations and evaluating feasibility
  2. Start looking at cost savings measures
  3. Working with the County Board to ensure the levy was re-instated and that they knew the implications for failure to do so
  4. Working with the union to keep the new union contract reasonable Ms. Dreimann asked about the process to reinstate the levy.

Mr. Austin provided the Board with some information on the process. The Board indicated that they would like to review the capital improvement and asset preservation plan again at a future meeting.

= = = = =
See County Board Forum comments on the $41.3 million sitting in Valley Hi’s bank account here.


The Argument for Not Killing the Valley Hi Tax — 4 Comments

  1. Everyone assumes that some kind of reserve cushion is necessary to keep Valley Hi operating.

    This is the wrong assumption.

    Why is no one asking the question

    “Why is the County of McHenry in the nursing home to begin with?”

    There is absolutely no reason that the county should be in this business.

    Private nursing homes are incredibly lucrative and profitable.

    There are about a dozen for-profit and not-for-profit nursing homes within the geographical boundaries of the county, and dozens more in adjacent counties.

    There is no evidence of a bed shortage in those facilities.

    There is no evidence that the county exiting the nursing home market would create a bed shortage.

    While it may have served a public good in the horse-and-buggy era, these giant, money-sucking boondoggles need to close.


    I encourage every candidate for county board who pretends to be a good steward of tax dollars to adopt the following proposal or something similar to end this mess:

    1. Valley Hi and Alden Terrace will stop accepting new patients in one year. This will give people who have already made arrangements for their loved ones to go to these facilities a chance to rely on the prior commitments of the county. Under no circumstances will the county accept new patients at these facilities who have not already been promised a spot.

    2. Shut down the facilities within 5 years. As the patient census count dwindles, begin laying off staff and closing unused annexes, floors, and wings of the building as necessary when the need for services decreases. I picked the 5 year number because as of 1999, the average length of stay for nursing home residents nationwide was 892 days (2.44 years). Twice that number should ensure that basically no residents will remain after 5 years.

    3. If any patients remain 5 years from now (or after the point that so few patients remain that it is fiscally impractical to keep them), find beds for them in private facilities in the county.

    4. Sell the buildings. The county will take a hit on Valley Hi because we stupidly built an expensive building in the middle of nowhere. So be it. Sunk costs are not a reason to keep something running. Under no circumstances should the county keep the building and give a county department a big, stupid palace. If there are still outstanding bonds or a note or some other form of financing for Valley Hi’s construction or operation, use the portion of the current surplus to pay them off. God, help us if we owe more than $41 million on that big stupid building.

    5. Take action to eliminate any levies earmarked for these facilities. If that is impossible without extraordinary measures (e.g. another referendum), reduce any levies earmarked for these facilities to zero.


    What say you, candidates for county board or incumbent members?

    Can anyone justify our operation of a nursing home?

  2. Taxing bodies are only legally charged to levy what is necessary to operate government; nothing more.

    Anything else is theft and when it comes to the 40 Million at Valley Hi, this theft on a grand scale.


  3. I consider it ALL to be grand theft.

    Why am I paying such high taxes so that the City of Crystal Lake can buy very expansive flower pots to decorate downtown?

    How is that justified?

    How is the payment for usless obelisks on Route 14 justified?

    Wake up, people.

    David is right.

    All of this spend, spend needs to stop, now!

    I am very much in favor of public pillories.

    A lot of this could be curtailed.

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