Local leaders call for investigation of SVMH Board’s secret privatization scheme

NewsJuly 5, 2011

Letters to County District Attorney and State Attorney General allege violation of state law by Board Members meeting in closed session

Salinas, California – Today, nine local labor and community leaders asked State Attorney General Kamala Harris and Monterey County District Attorney Dean Flippo to launch investigations into the Salinas Valley Memorial Healthcare District Board’s violation of a state law prohibiting elected board members from meeting in closed session to discuss the sale or privatization of the hospital.

Signers include representatives from the California Nurses Association, the union representing Registered Nurses at the hospital, the Monterey County Labor Council, the Monterey/Santa Cruz Building and Construction Trades Council and other community groups.

An article last week in The Salinas Californian revealed that the board authorized the hiring of the McKinsey Group, a controversial management consulting firm linked to the Enron fiasco, to compile a report laying out options for privatizing the district hospital. The firm was retained at a cost of nearly $1 million through a third party, the district’s outside law firm, in order to shield the document’s contents from the public under attorney-client privilege.

Upon learning that The Californian was in possession of the secret document and intended to publish a story describing it, Board President Jim Gattis and the hospital’s public relations director, Adrienne Laurent, implored the newspaper to kill the story and to keep their privatization plans secret, a follow-up story in The Californian reported. After the story was published in spite of the hospital’s objections, the Board voted to retain a private investigator to identify the individual who leaked the secret document.

Under California law, the board members’ private discussions of plans to sell the hospital were illegal. Section 32106 of The California Healthcare District Law delineates what subjects may be discussed in closed session, and explicitly prohibits closed door discussion of “(t)he sale, conversion, contract for management, or leasing of any district health care facility.”

“What this amounts to is a conspiracy to privatize the hospital and to conceal those plans from taxpayers, patients and the general public,” said David Serena, Trustee of the Monterey County Office of Education and President of the Coalition for Equality and Justice For All. “This is what’s been behind management’s crusade to cut the jobs and benefits of caregivers all along, and the hospital board didn’t want the public to know about it. They were willing to break the law to keep their plans secret.”

Read the letters here:  http://bit.ly/SVMH_AGLetter and http://bit.ly/SVMH_DALetter