Pine Crest referendum on the Agenda for Lincoln County Board
BY TINA L. SCOTT
UPDATE: After extensive public comment and discussions, proposed amendments, and explanations on various points pertaining to the proposed resolution at the Aug. 15 meeting, the proposed resolution to have a referendum on Pine Crest was ultimately voted down by a vote of 13 to 9. More detailed information will be provided in next week’s Foto News.
As this edition was going to press, the Lincoln County Board was set to meet on Aug. 15, 2023, at 6 p.m., and the hot topic on the Agenda was a resolution to authorize a binding referendum relating to Pine Crest and to approve the language for such a referendum.
If the resolution passes, as it was written and presented for the meeting, the referendum would ask Lincoln County residents whether or not they would support a $3 million increase in the Lincoln County tax levy each year for the next 10 years (2024-2033) “for the purpose of funding and/or subsidizing Pine Crest Nursing Home operations, maintenance, repairs, updates, and debt service.” If approved, that referendum question would be on the April 2, 2024, Spring Election ballot for Lincoln County residents to decide, and this would be a binding referendum.
The Pine Crest Nursing Home Ad Hoc Committee (Ad Hoc Committee) studied Pine Crest for the last two years and the clear result of that study was: Something has to change. Either Lincoln County needs to sell the nursing home or it needs to find a way to fund it to continue current operations and maintain the building and cover the annual debt service.
While North Central Health Care (NCHC) is contracted to manage/administer the operation of Pine Crest Nursing Home and the $630,000 annual debt service owed by Lincoln County on the property, the County also pays $440,815 to NCHC each year for this service. In 2022, this resulted in a net operating loss of approximately $1 million which is consistent with historical annual net operating losses, even prior to NCHC management, going back to at least 2016, according to Lincoln County Board members. Lincoln County has had to cover that loss. And as a result, maintenance at Pine Crest has been deferred, and maintenance on many other Lincoln County owned properties has also gone undone.
In addition, as the owner of the actual property, the County is responsible for paying approximately $400,000 in annual maintaince staff costs at the facility. But that hasn’t addressed the ongoing and deferred building maintenance needs that are long overdue. A comprehensive facility assessment was completed indicating $2 million is needed annually to address those building maintenance needs if it is to continue to operate effectively, the resolution outlined. Building maintenance cannot continue to be deferred.
A long and purposeful process
Deciding the future of Pine Crest Nursing Home isn’t a matter any of the Lincoln County Board members are taking lightly. At the Board’s May 2023 meeting, after months of individually, and as a Board, studying the almost 170-page report prepared by the Ad Hoc Committee, they spent hours considering all of the options the Committee had brainstormed and included in their report, especially those related to possible alternatives to increase revenue.
In a letter to Pine Crest residents dated May 12, District 9 Supervisor and Board Chair Don Friske said the Board had narrowed its options concerning the facility’s future down to two: “[drafting] a referendum question asking our voters to support an increase in their property taxes to fund Pine Crest’s operational losses; or [exploring] the sale of the Pine Crest Nursing Home to a privately-owned, skilled nursing home care provider.”
During the May board meeting, a resolution for a referendum introduced by District 3 Supervisor Elizabeth McCrank designed to gather public opinion on the matter was tabled indefinitely, in part because it did not ask voters for a specific dollar amount to fund Pine Crest operations.
“If we do decide we don’t want a private entity to run [Pine Crest], then I think we have to give the voters a referendum that’s real,” District 12 Supervisor and Finance and Insurance Committee Chair Julie DePasse said at that meeting. “We have to ask for the actual amount it costs to finance that, and we have to be honest about that number.” DePasse was also a member of the Ad Hoc Committee.
The Board had also discussed whether or not any potential referendum should be advisory or binding.
Ultimately, after a three-plus-hour May meeting, the Board voted 15-6 to direct the County’s Administrative and Legislative (A&L) Committee to begin the process of securing the services of a broker to determine if there is a viable market for the sale of Pine Crest. On June 28, 2023, the A&L Committee met to review three proposals received from interested commercial brokers in response to the County’s request for proposals (RFP) and recommended moving forward with Marcus & Millichap; however, no official action was taken on the matter at the July 18 meeting of the Lincoln County Board and it was not on the Agenda for the Aug. 15 meeting either.
Still listening to constituents, still considering options
During public comment periods, via Letters to the Editor in this newspaper and the Tomahawk Leader, and via petitions and press releases, many members of the public, including Pine Crest residents and staff, have voiced their support for Lincoln County’s continued ownership of the facility, loud and clear.
Having seen all the numbers, DePasse has said she thinks selling Pine Crest to a private entity is “the best way [the Board] can ensure the ongoing care of the residents that live there, not just now, but in the future.”
“Pine Crest has lost money for the last 15 years,” DePasse said. “It has lost over a million dollars per year, on average, since 2016.”
Yet, she is still open to maintaining ownership, if it is financially viable.
“If we do decide we don’t want a private entity to run [Pine Crest], then I think we have to give the voters a referendum that’s real,” DePasse said. “We have to ask for the actual amount it costs to finance that, and we have to be honest about that number.”
Proposed resolution for referendum
“As representatives of our community members, it is our responsibility to advocate for their voices to be heard through a binding referendum to determine whether the people of Lincoln County support raising additional funding outside the levy limits,” Tuesday night’s proposed resolution said.
The proposed resolution for referendum is sponsored by District 6 Supervisor Norbert “Nubs” Ashbeck and co-sponsored by District 22 Supervisor Greg Hartwig.
“Over the last year, I have been contacted by many Lincoln County residents and employees of Pine Crest, and overwhelmingly, they want Pine Crest to remain with Lincoln County, as the owner of the facility,” Hartwig said. “I do realize others may have the opposite opinion and understand why citizens on one side of the issue have been contacting me and other Supervisors.”
Hartwig wants to hear what all Lincoln County residents have to say on the matter. The proposed referendum provides that opportunity.
The fact is, Pine Crest cannot continue to operate as is. “There are two options: to sell the facility or a referendum to exceed the levy limits set forth by the State,” Hartwig said. “The facility can’t continue on its current path and funding.”
“The current budget is unable to fund all of the costs of Pine Crest,” he said. “The State of Wisconsin also reduced our supplemental payment by approximately a million dollars. There is a very long list of maintenance issues that the County has been unable to fund via the tax levy. A maintenance director summary reveals $8 million in repairs and general maintenance needed. This number doesn’t take into account inflation.”
“Our debt service for the 2017 addition is $630,000 per year with a balance of principal and interest of approximately $10 million,” Hartwig said. “This debt service is due to be paid off in 2038.”
That means continued ownership of Pine Crest would come at a cost to taxpayers. “The proposed referendum is $3 million a year for 10 years,” he said. “The cost to residents would be $85.14 per $100,000 of property assessment for a 10-year period.”
On a $200,000 home/property, that amounts to about $170 more per year in taxes to keep Pine Crest.
“I want the taxpayers to have a voice in whether they choose to pay higher taxes to keep Pine Crest County owned,” Hartwig said.