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No answers from health trust

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By David Giuliani

Sunday marks a year since the Las Vegas Health Trust vowed to communicate more with the public about what it’s doing. At a public meeting last year, its president even promised to provide a press release.

The Optic is still waiting for the release, and its calls to trust officials went unreturned this week.

The trust is the nonprofit group that manages the millions of dollars from the proceeds of the sale of the former nonprofit Northeastern Regional Hospital to a for-profit company in 2000. The state attorney’s office general is the regulatory agency, in charge of overseeing transactions involving large transfers of assets from nonprofit to for-profit organizations.

The idea was for the trust to develop a plan to give to charitable causes. It was supposed to do so within a month after the opening of a new hospital building, which was in May 2004. It wasn’t until last year that the trust finally came up with such a plan. But eight years after the hospital’s sale, the group hasn’t made any grants yet.

“The truth is that nothing has happened since the meeting. Monthly requests for public information have yielded nothing,” said Marshall Poole, a board member for the Northeastern Regional Community Foundation, which is the successor group to the auxiliary organization at the old hospital. Poole’s group has been making grants for three years now.

Poole shouldn’t be expecting much help from the attorney general’s office in getting information. Last year, the office issued an opinion that stated that most information involving the trust isn’t public.

The foundation has battled with the trust for the last several years, asking that it start giving grants to charitable causes, while trust officials have remained tightlipped, at times not revealing how much money they had on hand.

These days, foundation board members are backing off from serving as the trust’s watchdog.

“Our main position is that we will no longer contest the use of their funds under their control. We’re going to concentrate on our foundation,” said Tito Chavez, a foundation board member.

The trust received $6 million in 2000 with the sale of the hospital to Tennessee-based Community Health Systems Inc. The trust’s reserves dropped to $3.5 million, according to the attorney general.

At last year’s public meeting — a requirement of the trust’s memorandum of understanding with the AG — Gilbert Vallejos, the group’s president, said it had to pay many of the old hospital’s debts, which dropped the reserves to $2 million. Over the years, he said, the trust grew its reserves to $4 million, amounting to growth of 20 percent a year. That income came from such sources as interest from the funds as well as rent from the old hospital property.

Vallejos said last year that the trust’s fund then dropped to $3.5 million because of expenses related to the renovation of the old hospital, buildings the trust had been leasing to nonprofit organizations such as El Centro Family Health.

Many have questioned why the trust’s money has been invested in low-yield accounts at the Bank of Las Vegas, where Vallejos works as the executive vice president. Vallejos has argued before that he wasn’t involved in the corporate board’s decision to place the money in his bank.

Also, the memorandum sought an audit, but the trust has yet to do one. The AG hasn’t pressed the trust on this issue.

For years, Christine Turner, charity registrar of the AG’s office, has overseen the trust’s progress. But she has left her job since last year’s meeting.

“We are still working on updating the memorandum of understanding. The person who replaces her (Turner) will take up that task,” said Phil Sisneros, an AG spokesman.

Poole wants the AG to make sure the memorandum is followed.

“I believe it’s a public matter because they are public funds from a public hospital,” he said. “The travesty is that there are funds that haven’t been put to good public use. It’s a real lost opportunity for grant-making.”

Chavez wants the trust to start telling the public how groups can apply for grants.

“None of that has been made public as far as I know,” he said. “I don’t think they need to disclose everything. I trust them that they are taking care of the money. I think we should hold them to what they have said publicly and that is that they want to be more open. They should hold regular meetings, so people know what’s going on. I hope they do some good with the money, and I hope they do it pretty soon.”

For this story, the Optic left messages with the trust’s three key players — Vallejos, Executive Director Kathy Sena and Michael Gregory, the attorney. None returned the calls.

The Players

• Las Vegas Health Trust (formerly Northeastern Regional Hospital Inc.) — This nonprofit group manages millions of dollars from the proceeds of the sale of the hospital in 2000.

• Northeastern Regional Community Foundation — This nonprofit group was formerly an auxiliary organization to Northeastern Regional Hospital. The group has been giving money to charitable causes and has questioned the trust’s finances.

• New Mexico attorney general — This agency oversaw the transaction involving the sale of the nonprofit hospital to a for-profit company.

• Alta Vista Regional Hospital — Its parent company, Tennessee-based Community Health Systems, bought Northeastern Regional Hospital in 2000.