CHI Franciscan reportedly did donate almost $31,000 to the foundation ex-Bainbridge mayor Kol Medina worked for, court records say.
Medina later did not disclose that apparent conflict of interest when he made the deciding vote in a 4-3 City Council decision to buy Harrison Medical Center and turn it into Bainbridge’s police-court facility. CHI Franciscan is Harrison’s parent company.
Medina was CEO of Kitsap Community Foundation, which did not release that information earlier, but did when forced to by a lawsuit’s subpoena.
Plaintiffs are Bainbridge Taxpayers Unite, City Councilmember Michael Pollock and Lee Rosenbaum and Janice Pyke, owners of the Yaquina property, which had been the preferred site. Defendants are Medina, former acting city manager Morgan Smith and the city.
The lawsuit was filed June 2 and is now in federal court. The suit seeks damages under the Racketeer Influenced and Corrupt Organizations Act, plus a judgment against Medina for ethics violation, plus judgment declaring Harrison’s contract void, plus an injunction banning the city from further contracts with Harrison, plus attorney and court costs.
The judge in U.S. District Court is Tana Lin, who was recently appointed to a lifetime term by President Joe Biden.
At a BI City Council meeting in 2019 the council OK’d spending almost $9 million on Harrison, with Medina the deciding vote. It was appraised as an office building at $3 million, but sold as a medical facility, where it was appraised at around $7 million even though it was going to be changed into a police-court facility, court papers say.
The lawsuit alleges Smith provided the council with false financial information, saying Harrison would cost $20 million while Yaquina would cost $28 million. The suit says the Yaquina project would have cost $12 million.
Within six months the council approved an $8 million bond to help pay for Harrison, further forcing the city to stick with that site.
A subpoena answered by the foundation not only shows almost $31,000 from the parent company, but also other foundation donations from Harrison employees. Another piece of evidence, a letter from Medina, reportedly shows him asking for donations from Harrison (CHI Franciscan).
City Attorney Joe Levan reportedly advised Medina it was not a conflict of interest. A letter from the foundation says Medina was advised it would not be a conflict unless he was told to vote a certain way as a result of a donation, which he was not.
BI city government did not investigate the claims, resulting in the lawsuit.
BTU attorney Brad Thoreson recommended the RICO claim. Rather than the defendant being innocent until proven guilty beyond a reasonable doubt, under RICO it’s the opposite. The defendants must prove they are not guilty.
Medina, in his response to the subpoena asking for information, repeatedly says he has no information. He also objected because requests were overly broad and unduly burdensome, says a response from his attorney, Jessica Skelton of Pacific Law Group in Seattle. Smith’s response to her subpoena was similar, as was the city’s.
Court papers say Harrison bought the property in 2013 for $1.75 million and built the center, but just a few years later “was desperate to sell the property and avoid ongoing extensive operating losses.” In 2017, Harrison asked the city to buy it for its police-court facility.
The lawsuit says Medina’s annual salary of almost $100,000 was determined by donations to the foundation. Yet he claimed no conflict of interest before voting. Court papers say as an attorney Medina knows the law and actually recused himself from voting on other less-important measures during his tenure on the council.
Also,what was hardly ever discussed was that the Yaquina site would be new and much bigger, “substantially skewing the numbers toward the Harrison proposal,” the lawsuit says. The used Harrison building needed to be gutted and rebuilt.
Thoreson, said the comparison of Harrison and Yaquina was not “apples to apples” as the Yaquina site was 12,000-square-feet larger.
If Medina would have recused himself, as he should have because of the conflict of interest, Harrison would likely not be the site of the police-court facility, the lawsuit says.
On Jan. 31, 2020, the city bought Harrison for almost $9 million. The plaintiffs want the money returned to city coffers.
Dick Haugen of BTU says legal bills have reached $100,000 and could triple. If the plaintiffs win, those costs would be reimbursed. But in the meantime, “The city and other defendants are throwing up all available legal roadblocks to make our effort as expensive as possible,” he says in a letter. The nonprofit BTU is asking for donations to help online at BTU-BI.COM or BTU, P.O. Box 10945, Bainbridge Island, WA 98110.