EDITORIAL: Preserve the healthcare district EDITORIAL: Preserve the healthcare district (November 17, 2004)

We hope the decisive re-election of Kathleen Kane and Malcolm MacNaughton to the board of the Sequoia Healthcare District will persuade dissident board member Jack Hickey to end his misguided attempt to dissolve the district.

Mr. Hickey, a Libertarian who was elected in 2002, is a one-vote minority on the five-member board. Two of his supporters, Warren Gibson and Sonya Sigler, were soundly defeated November 2, trailing Ms. Kane and Mr. MacNaughton by 4,600 votes or more at Almanac press time.

Mr. Hickey's rhetoric, which has been picked up and promoted by some media outlets, is based on a pair of simplistic civil grand jury reports issued several years ago that criticize the district for continuing to receive taxes after the 1996 sale of Sequoia Hospital, which the district owned in full until then. The voter-approved sale, in effect, made the district a part-owner of the hospital in a partnership with the private, nonprofit Catholic Healthcare West in 1996. Mr. Hickey and the grand jurors claim that the tax money, collected from residents of Atherton, Menlo Park, Portola Valley, Woodside, Redwood City, San Carlos and Belmont, should now be given back.

Currently, the district collects about $5.3 million a year in taxes and another $5 million in rent on properties it owns; it disburses portions in grants to various health agencies, including the hospital. The district also gives a $1.3 million annual grant to the county's Children's Health Initiative, which provides health care to all uninsured children 18 and under.

The implication by Mr. Hickey and others that residents would pay lower taxes if the district were dissolved is not true, according to Martha Poyatos of the Local Agency Formation Commission (LAFCO). If the district were dissolved, the tax burden would remain the same, with the health-care district's portion simply going to other agencies in the county under a formula used to divide the revenue among various local cities and districts and the county.

Today, the health-care district board has more than $50 million in assets (some held over from the buy-in of the hospital by CHW for $30 million in 1996) to help ensure that residents have access to quality care. The board has pledged $25 million to help rebuild the hospital to meet state seismic standards by 2013.

During discussions about sale of the hospital in the mid-1990s, the issue of taxes was seldom raised. More important was a promise that there would be public oversight of Catholic Healthcare West due to concerns that the company's strong religious ties could conflict with delivery of the family planning and reproductive health services traditionally offered by Sequoia.

That promise has been kept, and now CHW and the elected Sequoia board have a strong partnership that has resulted in care being offered at the hospital. The next, and most important, collaboration will make it possible to rebuild the hospital at its Alameda de las Pulgas and Whipple Road site. Without the district's funds, it is unclear whether CHW would have been able to meet the building-upgrade mandate.

Ms. Kane and Mr. MacNaughton, as well as Art Faro and John Oblak, who was reappointed to his seat by the Board of Supervisors last week, will constitute a majority on the district board that is firmly committed to keeping the hospital district alive and will support the effort to rebuild the hospital in the years ahead.

Residents of the district pay very little in taxes to keep this excellent hospital in top form. The district is a good investment and dissolving it won't result in tax savings for anyone.

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