Bach dictates Memorial terms

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Mayor Steve Bach is flexing his muscles again by insisting the city negotiating team "consider" his list of conditions in the negotiation process with University of Colorado Hospital for a lease of city-owned Memorial Health System.

Not a picture of Steve Bach.
  • Disclosure: This is not a picture of Steve Bach.

In a press release issued this afternoon, Bach sets out a list of conditions of any lease, which is being negotiated by City Council members Brandy Williams and Merv Bennett, City Attorney Chris Melcher and an as-yet-unnamed consultant.

"At this point, we're interviewing different financial and legal consultants that might help us," Melcher said in an interview with the Indy earlier this week. He added he hoped to have the "team" in place within seven to 10 days.

Melcher seems to need help at every turn these days. He's hired an outside consultant for the city Oil and Gas Committee, who happens to be a lawyer.

He's also consulted outside attorneys on other city business, according to Council President Pro Tem Jan Martin. Our reporter J. Adrian Stanley recently interviewed Martin, who told her that Melcher had received three legal opinions in regards to the mayor’s role re: Colorado Springs Utilities lines of credit, but declined to provide them all to Council.

“ I said to him, ‘Don’t we have the right to see all three opinions?” she said. “And he said, ‘No, it will just confuse everything.’”

In any event, looks like Melcher will again get an assist from an outside attorney on the Memorial deal.

In addition, Bach wants the proceeds from the lease other than those earmarked for special uses, such as the medical school contribution, to go to an account segregated from the city's General Fund. Fair enough, as long as Bach is open to what he previously said should be a community discussion about what happens to that money. Bach himself has said he wants it to go into a health-care foundation, while the community might have other ideas, such as spending it on restoring certain services. University, after all, will be paying the city roughly $5 million a year, in addition to an up-front $74 million .

Here's what Bach is "asking City Council to consider ... as the negotiations proceed":


· Solicitation and consideration of the Mayor's advice in the negotiations, and incorporation of identified key terms and conditions in the final agreement.
· Use of qualified, outside legal counsel to assist Chris Melcher, City Attorney and the City’s negotiator on the Lease, in the negotiations. MHS should advance all City negotiation costs and be reimbursed by the Lessee.
· A time limit for negotiations of 6 months or less, and a submission of the final lease to the voters in a timely manner thereafter. MHS should advance any City pre-election public information expenses and election costs and be reimbursed by the Lessee.
· A concrete solution on all PERA issues, including any City obligations, with a specific monetary guarantee from the Lessee to address and resolve any City liabilities.
· A Council affirmation in advance of Lease execution, and a commitment in the Lease, that all financial payments from Lessee, including upfront payments, annual lease payments, and surplus revenue sharing payments, are all transferred directly into a segregated account at the City or an escrow account under the City’s ownership and control, and not into the General Fund.
· Memorial management and board members should not participate in the actual negotiations, but should provide timely information and suggestions to the City Attorney when requested.
· The ballot initiative should include language establishing a Colorado Springs Healthcare Foundation with a stated mission, governance structure, and policy guidelines to be determined by the Mayor and Council jointly.
· Enhance local control, input, and management of MHS during the Lease to the maximum extent possible.
· A commitment on the disposition and use of the monies currently held by MHS in their cash and operating accounts.
· A commitment to develop a Level 1 Trauma Center at MHS.
· A commitment to maintain Tricare, Medicare and indigent care.
· A commitment that the Lessee will pursue a Branch Campus Medical School at UCCS, with a written timeline, stated deadlines for progress, and a firm guarantee for at least $3 million per year towards such effort.
· A commitment to continue the Sexual Assault Nurse Evaluators (SANE) program.
· A financial guarantee, and proof of sufficient financial resources, commensurate with the financial commitments of the Lessee over the full term of the Lease.
· Stated and measurable performance outcomes that ensure the community is receiving the appropriate level of care and performance from MHS, with clear reporting obligations, performance guarantees, and penalty provisions as appropriate.
· Clear and well structured termination provisions in the event the Lessee is unable to satisfy the obligations of the Lease, even after notice and a cure period.
· Clear and firm financial guarantees from Lessee on the additional funds that would be provided to the City if (1) the PERA issues are resolved for less than the stated amount necessary in the RFP process, and (2) an appropriate share of future MHS surplus revenues or profits based on improved operations.

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