BREWER, Maine — The possibility that Brewer may sue Eastern Maine Healthcare Systems over taxes on a building that EMHS now owns was revealed by a city councilor this week.
Councilor Larry Doughty alluded to the issue Tuesday night as the City Council was discussing a resolve about contract negotiations between Eastern Maine Medical Center in Bangor and its nurses union.
Doughty said city leaders should not be “sticking our noses into this issue” — meaning the contract negotiations — especially since “we’re heading for a lawsuit with them.”
He did not specify what possible lawsuit he was referring to at the meeting, but afterward said it concerns a property tax issue involving EMHS’ Cianchette Building on Whiting Hill.
“The hospital promised us three years ago … that they would pay taxes to help us over the hump” created when the Cianchette Building was taken off the tax rolls and placed in the nonprofit, hospital buildings category, Doughty said. “They’ve reneged and they don’t want to pay it.”
The city has hired a lawyer to look into the matter, he said, adding that he had warned city staff earlier in the day that he planned to announce the possible lawsuit during Tuesday night’s council meeting.
City Manager Steve Bost said Wednesday that the city has hired Bangor lawyer Charles Gilbert.
“We have retained legal counsel on this matter and I’ve been advised to send you to him,” Bost told a reporter.
“I can confirm, since it’s already a matter of public record, that I have been engaged by the city of Brewer regarding a matter involving Eastern Maine Healthcare Systems,” Gilbert said Thursday.
He went on to say that he is investigating whether the city should file a lawsuit and said it would be premature to discuss the matter further at this time.
Suzanne Spruce, a spokeswoman for EMHS, also was guarded in her comments Thursday when asked about the situation.
“All I can tell you is that we value our relationship with the city of Brewer,” she said. “If there is a problem, we’d like to sit down and talk” in order “to reach a mutually agreeable resolution.”
The Cianchette Building was constructed in 2004 by Cianbro Corp. of Pittsfield. At first, Cianbro owned and leased the building to EMHS and paid property taxes, but on Nov. 14, 2008, hospital officials purchased the building for $22.6 million, which made the property exempt from taxes because of its hospital status.
EMHS officials said at the time that purchasing the building outright saved them an estimated $6 million in future lease payments.
Brewer had been paid about $305,000 in property taxes by Cianbro in the year before the building’s sale.
City officials said at the time of the sale that a verbal agreement with Cianbro to ease the expected decrease in tax revenues turned into an initial agreement between EMHS and the city, but it later was abandoned.
The initial agreement between EMHS and the city would have provided Brewer with a year’s worth of payments in lieu of taxes, spread over two years, Bost indicated in 2008. That would have provided approximately $150,000 for two years to reduce the burden on taxpayers, he said.
Doughty said Thursday he never would have raised the issue at Tuesday night’s meeting if the resolve involving the EMMC nurses had not been on the agenda.
Three nurses employed at EMMC — including Cokie Giles, president of the Maine State Nurses Association —approached the City Council in December and asked it to support their efforts to increase nurse-to-patient staffing levels. That led to the resolve presented Tuesday night.
The resolve was brought to the table by Mayor Joseph Ferris and Councilor Kevin O’Connell, who read it into the record before fellow councilors voted on it.
The five-paragraph document refers to the nurses’ visit last month and states that the “Brewer City Council believes that an expedient resolution of this dispute is in the best interest of the citizens of Brewer and the entire eastern Maine community” and that the council “encourages both the administration and the nurses union to work to find mutually agreeable terms in order to ensure a continuation of affordable quality care at Eastern Maine Medical Center.”
At the end of the December meeting, Doughty said the union nurses should not be asking municipal bodies for support.
After the proposed resolve was read Tuesday, Doughty said, “I can’t believe that this resolution is before us.” He added that it “makes us look like we’re taking sides.”
Other councilors, including Jerry Goss and Mayor Ferris, disagreed.
“The order clearly doesn’t take sides,” Ferris said. “We came up with an order that is absolutely down the middle.”
Doughty said just considering the order gives the impression that city leaders support the nurses union.
“I have to think that for this council to get involved, we are taking sides,” he said. “You can’t tell me that this isn’t going to” affect the possible lawsuit.
Councilor Arthur “Archie” Verow said that “to put an end to the windbaggery,” he would call the question. That ended the discussion and led to a quick vote, which was unanimous in favor of the resolve.
Afterward, Doughty said the swift vote caught him off guard and he didn’t mean to vote yes.
“I wish I could take that back,” he said. “My statements speak for where I stand” on the issue.