Wednesday, October 07, 2009

Stop The Wishard Referendum

Carl Moldthan of the Indianapolis Taxpayers PAC is seeking support for the organization's efforts to defeat the Wishard referendum, which proposes what could be the largest property tax increase in Marion County history, notwithstanding the lie you are being told by the proponents that no new taxes are being proposed. You can e-mail Carl at, or you can mail contributions to the PAC to him at 3130 E. Southern Avenue, Indianapolis, IN 46203. Moldthan does a good job describing the scam the Health & Hospital Corporation is running to defraud the federal government of Medicaid dollars to pay for a new county hospital:

My name is Carl Moldthan and during the past four months I have looked at HHC’s budget, the CAFR’s for the past five years, their tax stream, the Special Funds they receive from Medicaid, the nursing homes they own and virtually everything anyone can think of. The truth is as I will explain:

Wishard owns 37 nursing homes all over the state, (Elkhart (2), Evansville (2), Ft Wayne (5), Monticello, Valparaiso, South Bend and many more cities) which they receive approximately $17 million a year in revenues from. They also receive, as of 2008, $51 million from Medicaid’s special funds called Upper Payments Limits (UPL). These UPL funds make up the gap between Medicaid and Medicare for nursing home residents. As an example, a normal Indiana nursing home receives approximately $3,400 to $3,900 per month, per patient. However, HHC receives on average approximately $9,898 per patient, per month. These extra funds give HHC an advantage over other nursing homes because they can do improvements and repairs that other nursing homes cannot afford. This is one reason why HHC should NOT own nursing homes.

It is these extra UPL monies that are supposedly going to pay for the Bond Issue. In the real world these funds could be considered or identified as revenues. However, because they CANNOT guarantee these funds HHC must back these bond issues with General Obligation Bonds, thus the referendum. General Obligation Bonds are backed by PROPERTY TAXES. The only method of bring them down is stopping the bond issue.

There are several things that can bring this bond issue to the point where we have to pay for it but the main three are:

1. If enough nursing homes in other cities complain to their respective Congressman, US Senator, State Senator or Representative there will be a huge hue and cry to close the loophole that allows HHC to own these nursing homes that is assuming that it is legal in the first place. This would cut their stream of UPL money thereby ending the revenue stream and starting a huge property tax increase on all of us. The sad thing is that this tax may NOT BE INCLUDED in the Property Tax Cap by the time we have to start paying for it. The cost to an average taxpayer who owned a house valued at $150,000 would be an extra $175 per year.

You’ve got to ask yourself one question: Do I feel lucky? Well, do ya, taxpayer?

2. The Medicaid money received for these nursing homes could be shut off tomorrow without notice by Medicaid. This type of Medicaid has been under investigation by the GAO and Congress for the past 8 years. The reason for the problems is the fact that so much money can be obtained and UPL money amounts are uncontrollable. Congress has referred to UPL as a SCAM. When it involves this type of money one has to ask the important “What If” questions. What if 10 other communities learn about the EASY method of building a new hospital and instead of $42 million per year (BOND COST PER YEAR) Medicaid is paying out $420 million a year? Medicaid would put a stop to this immediately and again the Taxpayers of Marion County would have to pay.

You’ve got to ask yourself one question: Do I feel lucky? Well, do ya, taxpayer?

There are several other things that can happen but these two are the most probably. I like to think back to 1983 when then Mayor Hudnut promised that the 2% Food and Beverage tax would disappear after the $75 million Dome was paid for. Now, 25 years later we still owe $69 million on the Dome which if you’ve looked lately isn’t there, and the Food and Beverage tax is at 7%.

You’ve got to ask yourself one question: Do I feel lucky? Well, do ya, taxpayer?

We all need to focus on one thing and that is beating the bond issue. The who, what or where doesn’t matter, the ONLY thing that matters is stopping the BOND ISSUE. If you have any question you can reach me at
I'm disappointed to report that the Republican Party has dispatched Deborah Daniels, the sister of Gov. Mitch Daniels, to pitch passage of the Wishard referendum to the various township GOP clubs this month. Opponents of the referendum have not been afforded equal time by the party, which I'm told is supposed to be the party that opposes higher taxes. At a meeting Monday night before the Wayne Township GOP club, I'm told that Daniels faced a tough grilling from Sen. Mike Young and Rep. Phil Hinkle. Due to the unexpected tough questioning, Daniels' presentation fell flat. Although Daniels claims to be a volunteer for the effort, the truth is her law firm, Krieg DeVault, is paid to lobby on behalf of the Health & Hospital Corporation. I recall Daniels lobbying for the Health & Hospital Corporation back in the 1990s when Mitch Roob served as CEO of HHC. On Monday, Roob called the HHC's financing scheme for the new hospital using nursing home revenues "a bit of scam." The former FSSA Secretary and current CEO of the Indiana Economic Development Corporation predicted that the HHC's nursing home scam would eventually draw the scrutiny of the federal government.


Downtown Indy said...

The thing I'm trying to understand is: Matt Gutwein has come out repeatedly and 'explained' that they peg the amount of the debt repayment as 'small,' something like 4.5% of their revenue stream.

Matt Gutwein has opted to go with G.O. bonds that incurs a few percentage points more favorable (to Wishard) rate but which puts a significantly higher (Carl put it at 90%) risk of taxpayers ultimately being stuck with more property tax assessments.

Further, Matt has doubled-down on his bet by depending on Medicare/Medicaid money that has a better than 50-50 chance of drying up in the near future.

Matt has opted AGAINST using the other type of bonds (dang I can't remember the name given to those) which has ZERO risk of adversely affecting taxpayers, but costs Wishard just a few percentage points more to pay them back.

Option 1 is a very high risk to taxpayers for only a slightly more favorable expense to Wishard

Option 2 is a single-digit bond rate increase to Wishard (on what they describe as a miniscule fraction of their revenue) and ZERO risk of taxpayers being saddled with a higher (probably double digit) property tax rate.

Wishard, being our 'community-minded' and 'compassionate' hospital picks Option 1 to put taxpayers on the hook instead of sucking in their gut and going with Option 2 which does not.

Do I have that right???

guy77money said...

One thing I am not sure about is where do we vote against the Referendum? I assume there will be one voting area per township?

Advance Indiana said...

You can vote early at the County Clerk's office in the City-County Building, or you can cast a vote at your regular polling place on November 3.

Had Enough Indy? said...

DI - the 2nd kind of bond is simply called a 'revenue' bond -- backed by revenues, obviously. You make a good point. I think if Gutwein is selling the public on the referendum by saying no new taxes, then he should not be securing the bonds with property taxes. Truth in advertizing.

I have an outstanding question I posed to Kevin Taylor of the bond bank, but he has not responded as of yet. That question is -- H&H raises $25 million a year in property taxes now. The bond repayment can go as high as $54 million. If all of the bonds floated end up being secured with property taxes, does it mean that H&H MUST be getting $54 million a year just as proof that they can repay as promised. I assume there are securities laws that rule here. That could mean an immediate tax hike.

Advance Indiana said...

Keep asking those great questions, Pat. We need answers to all of them.

Citizen Kane said...

More lies:

From: Administrator, Exchange
Sent: Thursday, October 08, 2009 11:56 AM
To: Administrator, Exchange
Subject: Please Consider Working the Polls for the Special Election on November 3
Importance: High

City-County Employees:

In less than 30 days, Marion County voters will go to the polls to participate in a countywide referendum election to vote on whether the Health and Hospital Corporation should improve Wishard at no cost to tax payers. Voters living in Beech Grove and Franklin and Perry Township school districts will also participate in separate referenda elections concerning funding for their schools.

Poll workers are still needed for this historic special election held on November 3, 2009. Though not a scheduled holiday, I encourage City-County employees to work the polls on Election Day. Attached is a letter outlining my poll worker program, allowing you to take the day off without using benefit leave as long as you commit to working the polls and have your supervisor’s permission. To work the polls, you must be a registered voter, live in Marion County and attend training.

Please consider being part of history this November. If you have questions about becoming a poll worker, you can reach the Marion County Election Board at (317) 327-5100.


Gregory A. Ballard
City of Indianapolis

P.S. If you’re looking for a more convenient way to vote, the Clerk’s Office is now open from 8 a.m. to 5 p.m. Monday through Friday for early voting. You do not need a reason to vote early, but you will need to bring a valid, photo ID issued by the State of Indiana or the federal government.