$2M debt passes to Forum in default Oakhill Renaissance closing announced

Friday, April 21, 2006
By DEBORA SHAULIS and WILLIAM K. ALCORN
VINDICATOR STAFF WRITERS

YOUNGSTOWN — Forum Health officials say the nonprofit owners of Oakhill Renaissance Place have defaulted on a $2 million development loan that the health system is now responsible for.

Forum disclosed that information Thursday, after Southside Community Development Corporation told Oakhill's 25 tenants to prepare for the building's closing "as early as April 30, if necessary."

Forum Health is projecting $60 million in losses for 2006 without what it calls a radical restructuring and $25 million in concessions from its unionized employees.

"This failure on the part of the Southside Community Development Corporation has forced Forum Health to deplete its resources by $1.9 million at a time of tremendous financial challenge for the system," officials said in a prepared statement.

Oakhill Renaissance Place, 345 Oak Hill Ave., is the former Forum Health Southside Medical Center. The volunteer SCDC was formed in 1998 to convert the building into a community hub as part of South Side revitalization.

Tenants of Oakhill

Oakhill's tenants include Youngstown City Health Department, the Mahoning County coroner's office and morgue, Mahoning Valley Hospital for long-term acute care patients, and various educational and social service agencies.

Janet Yaniglos, vice chair of SCDC's board of trustees, said tenants employ more than 200 people and occupy 45 percent of the building.

The board is saddened that its recent efforts to keep Oakhill open have been unsuccessful, Yaniglos said Thursday during a brief press conference.

The relationship between Forum Health and SCDC has been unclear in recent weeks.

A number of city and county officials have said Forum Health had been financially supporting Oakhill, with figures ranging from $80,000 to $100,000 per month.

Reports denied

SCDC director Adrian R. Byrne recently denied those reports, telling a reporter that Forum's financial stake in Oakhill was "discretionary." Byrne said: "They supported us when they felt like it ... They'd help us if something broke."

Atty. Stuart Laven Jr. of Cleveland, who represents SCDC, said Thursday that Forum Health had provided a "substantial amount" of money for Oakhill's operations. Laven was identified as SCDC's spokesman, but he didn't return other phone calls seeking additional comment.

"Forum Health entered the Southside arrangement as a goodwill effort to our community back in September 2001," the health system's statement read. "Having sold the building to our community for $1, we agreed to help subsidize its operations for a period of nine months only and guaranteed a $2 million loan to develop the property. Forum Health has had numerous conversations with their management since the beginning of this year informing them that we would no longer be providing this subsidy."

Created a crisis

SCDC said the loss of what it called third-party financial support created a crisis that led to a decision to close the facility.

Some tenants were surprised to receive eviction notices Wednesday.

"Our little bubble is just kind of deflated," said Jacqueline Burley, director of Protestant Family Services, a faith-based program that supports people in emergency situations by providing food and helping with utility bills.

Protestant Family Services was in the middle of a five-year lease at Oakhill. "I was looking forward to renewing it," Burley said, adding that she would have preferred a 10-year contract. At Oakhill, Protestant Family Services enjoyed access to the building's conference center, storage space, handicap-accessible features and central location with bus service.

"I sure wish someone would come through and pick up the pieces so we can stay here," Burley said. Otherwise, the program will continue in a new location, she added.

Bert Cene, director of Mahoning Columbiana Training Association, said that agency's youth center in Oakhill Renaissance Place will probably move to MCTA's offices at Front and Market streets. Cene said he'd prefer not to house adult and youth employment programs in the same building. The youth center has been in the Oakhill complex since 2004.

Too little notice

The city health department "can't realistically move in two weeks," said Jason Whitehead, chief of staff for Youngstown Mayor Jay Williams.

City health commissioner Neil Altman said he knows of no available space that is set up for medical purposes as is the Oakhill building. It is extremely expensive to retrofit a building for medical use, he said.

"We looked for space for 10 years before this became available. All we had to do to move in was install a piece of security glass for the records department," Altman said.

The health commissioner said he plans to meet with Williams, he hoped today, to see if he has any ideas.

Mahoning Valley Hospital is Oakhill's largest tenant. SCDC said talks are ongoing about keeping the building open on a short-term basis for the hospital's sake. Oakhill's contract for maintenance services ends April 30, however.

Michael Senchak, president of Mahoning Valley Hospital, was unavailable to comment Thursday. Senchak told a reporter Monday that his board is looking at property in Boardman to build a hospital and relocate.

SCDC has been consistent in saying it needed an anchor tenant at Oakhill. Earlier this month, Byrne said tenant leases generated about $1.4 million in annual revenues, but that income didn't offset all expenses.

SCDC saw a potential anchor in Mahoning County. Two years ago, it offered to donate Oakhill to the county and chip in $500,000 for renovations to consolidate county offices, including the Department of Job and Family Services. Two different boards of county commissioners have studied the offer but did not take action.

The county rents space for JFS in McGuffey Plaza for $37,000 per month.

Mahoning County Commissioner Anthony Traficanti said the commissioners were still determining whether the county could afford to maintain the Oakhill property. Roof repairs were estimated at $600,000, he said.

shaulis@vindy.com