St. Joe’s Community Center – Let’s get fiscal/ physical – Let’s get REAL
Let’s Get Physical Lyrics
I’m (they’re) saying all the things that I (they) know you’ll like
Making good conversation
I (they) gotta handle you (us) just right
You know what I mean Steve Kipner/Terry Shaddick)
I am dithering – I am not sure what is the best course of action for St. Joseph’s Community Center( the old St. Joseph’s hospital) and I haven’t seen anything from those that should know and are in charge of the project to give me a clear picture.
There is a history to the Old St. Joseph’s Hospital;
From Lizzie’s Guide to Lorain
The house was called the “Devonian Baths” and was built in 1887 over sulphur springs discovered by accident by Gilbert Hogan, who had been drilling for natural gas. This is one of the early pictures of the hospital
March of 2009 the article in the Morning Journal
St. Joseph center in crisis: Lack of tenants, operating capital could cause eventual closure
had the then President of the South Shore Development Board ( In 1997 St. Joseph Community Center was created by the South Shore Development CDC ) – Jim Cordes ( Lorain County Administrator) as stating:
The center is running out of cash and faces about a $300,000 deficit this year, he said.
It seems that number ($300,000) continues to be a problem because according the Chronicle nearly three years later :http://chronicle.northcoastnow.com/2012/02/08/developer-warns-about-fiscal-physical-problems-at-st-joes/
As of Dec. 21, Hipp wrote, South Shore had past due bills totaling $287,892. Hipp also wrote that his company projected that St. Joe’s would be running deficits of $25,000 per month as 2012 got under way, and there was no plan in place to absorb those costs.
Between those two statements a lot of “planning, bells and whistles, handshaking and patting on the back has happened .
Lorain City Council in 2010 approved money to operate St. Joe’s while Krasienko’s administration looked for ways to keep it open.
The agreement also calls for the current South Shore board, which has been largely defunct since the city took control of St. Joe’s at the beginning of the year, to be replaced with a new ninemember board. Five of the board’s members will be handpicked by IRG, which gives the company a controlling number of seats. Three members will be selected by the city. The county commissioners will pick the final board member.
In fact just last June 2011 another deal was brokered with great hoopla and artwork
“Definitely good news,” said Mayor Tony Krasienko. “Obviously, we’ve put a lot of time and resources into making sure the St. Joseph Community Center is a success.
However, there was concern from some on Lorain City Council as to the “way forward” and in July 18 2011 an update on the situation at St. Joe’s was requested. You can find the minutes of that meeting in the following PDF file
council meeting minutes
There are many questions with long – term stability of the building and group etc.What kind of cash reserves do we have on hand for repair and maintenance etc. What if the basement floods or sewer breaks etc.
Lee Berger: Financially I am happy to say we are projecting to be stable by the end of this year ( 2011) with the sale of the 5th floor. We have done a lot of work internally to get the operating costs down to something we can handle and obviously leasing the building is our way out. Our projections in 2012, which we are working on now, will start the year at zero and hope with new leasing that we will be in good shape in 2012 and forward.
So what happened that just about 5 months after that meeting crisis hits?? and the Ohio Realty Advisors managing the property sends a letter
states in his letter ( emphasis mine) :
Hipp also wrote that his company projected that St. Joe’s would be running deficits of $25,000 per month as 2012 got under way, and there was no plan in place to absorb those costs.
“From the onset South Shore was operating in a deficit with no long -term plan to fund shortfalls,” Hipp wrote.
How things seem to have changed in 5 months–
Did this whole project rely on one group purchasing the 5th floor and therefore injecting $300,000 cash plus build out into the project.
Oh! I am waiting for my Aunt Lilo Lil to die as I am in her will and then I can pay my mortgage and utilities and remodel – but Old Lil runs off with another suitor or writes you out of the will – and your creditors get stuck with the bill
Not a good business plan it seems at least to this “lowly surface dweller”. I am always amazed at the thinking ( which is more often than not) on basing financial decisions on a “projected income”- but then there is that old “well of the taxpayer” if things don’t come off as planned.
My concerns are these :
Why didn’t the South Shore Development Board and Ohio Realty Advisors in July express their concerns before Lorain City Council when Given ( pun intended) the opportunity. Since I was told yesterday the “letter” that was dated January 5th 2012 was to get the attention of the new administration Why not ask for a meeting , a phone call might have served their purpose a little better because NOW – well they are getting attention NOW aren’t they?
WHERE WAS THE FOLLOW THROUGH?
Given asked: How much do you think you need to have rented to cover all your costs and after that the pressure is off.
Berger:I have that in my performa and I do not have that with me but it will be presented to our Board during the next Board meeting- that will then be presented to council-
My understanding is that no information was received by council members– who was the follow through person? NOTE: Joel Arredondo-Lorain City Council President also serves on the South Shore Development Board
Also in Hipp’s letter he states
“The situation within the Administration of the City of Lorain over the past 10 months has also negatively impacted the progress of the project
Question since this was the Krasienko Administration ( who brokered the deal ) and just 6 months previously had the “celebration of St. Joes- and Robert Gilchrist was being praised…. what situation????? And why weren’t council informed there was a “administration” problem 5 months ago when they had the chance ?
And now my thoughts –
I think cool, clinical accounting heads need to be in the mix – a “BUSINESS PLAN” based upon actual funding– not IF- not stop-gap budgeting – needs to be in place – because even with “new tenants” there are always expenses that come with being the landlord.
All costs should be itemized- all assets- actual income and actual costs not projected with whatever rosy coloured forecasts of ifs and maybe and hope ( hope like plan is a four letter word )….
And speaking of tenants
There are partnerships and groups within the space providing a valuable service to the community . Those tenants have provided income and a tax revenue to the City of Lorain . I would hate to see the loss to them and to us should the building close. They are also experiencing “physical problems” as per their letter found here
Jan 31 St. Joe’s tenants meeting letter to Southshore Board (1)
And lets us have some “real discussion” not the “congratulatory wishy-washy claptrap” as evidenced at the South Shore Development Board Meeting on Febrary 9th-2012
Scant answers provided at St. Joe’s board meeting – by Brad Dicken ( who first broke the story of “the letter”)
Morning Journal – Rick Payerchin
The meeting lasted about 40 minutes, but shed little light on conditions at the St. Joe Center. The board did not have a quorum and could not vote on any proposals
ED NOTE: That was definitely the understatement of the year imho 🙂
South Shore Development-Ohio Realty Advisors City of Lorain and Lorain County LET’S GET REAL – Let me Hear your “Board ” Talk!!!! and walk the walk – too many people’s lives , businesses and money depend upon an accurate picture