State University of New York officials have ended negotiations with the real estate investment and development firm Peebles Corp. concerning the purchase of Long Island College Hospital in Brooklyn, N.Y., according to a Brooklyn Daily Eagle report.
Under the firm's original proposal, Peebles planned to run LICH's emergency department under SUNY's license until July 1, when it would be transitioned to Peebles' healthcare partner, Great Neck, N.Y.-based North Shore-LIJ Health System. However, in a letter on Tuesday, Peebles informed SUNY that an issue concerning the tax-exempt status of bonds connected with the emergency department, it would be best to run the ED under SUNY's license for at least six months, according to the report.
Ruth E. Booher, SUNY’s Deputy Counsel for Health Affairs, has called the revised proposal from Peebles unacceptable, according to the report. Furthermore, Peebles is also seeking a cost-sharing arrangement under which taxpayers would hold partial responsibility for environmental remediation, which SUNY has also deemed unacceptable. Peebles has responded that SUNY is "mischaracterizing" the issue. Furthermore, the firm believes each of the issues SUNY has brought up can be resolved in a way that takes into account the concerns of SUNY and the state, according to the report.
Earlier this month, SUNY similarly ended negotiations with Brooklyn Health Partners Development Group after the company proposed seeking designation as a temporary operator for LICH after SUNY transferred control.
SUNY has said it will now begin negotiations with Fortis Property Group. In March, LICH received nine partnership offers from various hospitals, health systems and developers. The hospital has experienced significant financial pressures, according to an audit released last year by New York Comptroller Thomas DiNapoli. According to the January 2013 audit, the hospital experienced losses of $13 million per month and faced immediate insolvency.
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