Mark Kindt wrote:In "Civic Accountability -- Honesty in Local Government I", I presented the case that the city administration was making material financial misrepresentations to the holders of its municipal bonds in violation of federal securities law.
While the city administration clearly feels that it can make any misrepresentation it wants to its citizens, their council-members, and our local courts, it just can't be this cavalier with its bond-holders, the bond market, or the Securities and Exchange Commission without risk.
The recent 2018 appraisal of the former hospital site was all about this kind of "creative" accounting. Yes, somehow the appraiser "missed" the fact that there was an actual building sitting on the real estate that they were appraising. Why? Because the owner of the building (our city) instructed them to ignore it.
An official appraisal was propounded at the specific request of council-members that excluded the value of the actual hospital building! So, we now have an appraisal that is shorted on a building value that is likely in the multi-million dollar range.
Yes, this is a building that the city owns, but try to find that building on the city's books.
My final point is that the city administration is representing that they are participating in an investment. Another misrepresentation to the bond market, perhaps?
(For those public relations professionals or lawyers that might come across this, please take the time to read the U.S. SEC Statement known as the "SEC Harrisburg Release". It is easily found online.)
I want to highlight the recent 2018 appraisal of the former hospital site.
Why?
Because this is the second "bogus" appraisal that has been identified.
Several accountants and lawyers have previously written about the "as instructed" real estate appraisal for the building at 850 Columbia Road that "shorted" that appraisal of that building's actual market value as a commercial property.
As we review decisions, actions and documents related to the liquidation, demolition and redevelopment of Lakewood Hospital, we can identify consistent patterns of behavior that should raise doubts in the mind of every citizen.
We are witnessing the effective execution of a long-range planning effort that has diverted and will divert millions-upon-millions in municipal wealth into the hands of private parties, both non-profit and for-profit.
And, it's not over yet. We are witnessing in real time, the consequences of a massive exercise in privatization. --All led by our current city administration and those council-members who support it.