MCH pays back $3M in ARPA funds early

MCH pays back $3M in ARPA funds early

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  • November 19, 2022
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Medical Center Hospital, 500 W 4th St, Odessa.

By Kim Smith and Laura Dennis 

Odessa Mayor Javier Joven has drawn the ire of several city council members who say he acted “unprofessionally” and “unethically” when he went to Medical Center Health System last week and asked them to repay a $3 million loan given to them during the COVID-19 pandemic. The three-year loan wasn’t due for another 22 months.

Council members Steve Thompson, Tom Sprawls and Detra White said they were never told Joven intended to make the request, found the request to be abhorrent and a gross case of overstepping Odessa City Manager Michael Marrero.

They are also upset because they believe Joven has unilaterally decided to use the money to provide raises for Odessa Fire Rescue personnel despite the fact a compensation study is still underway for all city employees.

They believe Joven’s actions are a portent of things to come, especially now that three new council members will be sworn in next week to replace a trio of council members that routinely voted against Joven and Councilmembers Mark Matta and Denise Swanner.

Chris Hanie, Gilbert Vasquez and Greg Connell ran unopposed for the seats being vacated by Mari Willis, White and Sprawls, respectively.

Joven did not respond to an email seeking an interview. Swanner and Matta texted to say they’d agreed to give an “exclusive” to an online social media outlet and declined to answer additional questions. They applauded Joven’s actions in the other news story.

“I feel it would be unethical of me to give any other info on this subject to another news source,” Matta texted.

Marrero and Assistant City Manager Cindy Muncy didn’t respond to emails sent Saturday. Willis also didn’t return a phone call.

The hospital requested the funds due to the financial strain the COVID pandemic caused the hospital; the hospital was forced to stop surgeries for months.

The city also loaned Odessa Regional Medical Center $1 million, but it’s unclear if Joven asked them to repay it. CEO Stacey Brown hasn’t returned a phone call seeking comment.

MCH received the funds in September 2021 and under the terms of the agreement, the hospital wasn’t expected to pay the city back until it received reimbursement from FEMA, which has not yet happened. Hospital officials say all the paperwork to FEMA has been turned in and they expect a full refund.

MCH CEO Russell Tippin confirmed Friday night Joven emailed him last week seeking the funds back now to “give Odessa firefighters raises.”

Tippin said he immediately asked for a check to be cut to reimburse the city early instead of waiting for FEMA to reimburse the funds as was the original agreement.

“I have no doubt we will get our full reimbursement from FEMA,” Tippin said. “I would like people to know we appreciate people helping us out and we are glad to get it paid back.”

“In trying to be good partners …we do our best to oblige and we are glad to pay it back early. The city helped us out when we needed it and we are in a better (financial) spot than we were,” Tippin said.

MCH also sought help from Ector County but was turned down. The ARPA funds essentially had a provision that if the funds were used for certain types of healthcare needs during the pandemic FEMA would reimburse hospitals dollar for dollar essentially doubling the ARPA funding.

Overstepping?

Sprawls, White and Thompson each said they think the loan repayment should have been discussed by the city council and if they had agreed to make the ask, City Manager Michael Marrero or City Attorney Natasha Brooks should have represented the city.

Thompson said Marrero was unaware of the request until he received an email from Joven asking if the city had received the check.

“The mayor is now running the city not the city manager. This is not how our city government is set up. It is a complete breach,” Thompson said. “The headline needs to be ‘City mayor wants the city manager job.’”

The city and MCH have a great relationship and White fears Joven’s actions may have damaged it.

“When we allocated that money we knew what the plan was. We were willing to wait to see if we could recoup any of that money and it was voted upon, it was agreed upon and so it was disturbing to hear that he had gone and wanted that money back now,” White said.

If the shoe were on the other foot and it was the hospital asking the city for the money, White said she would have been left with a bitter taste in the mouth.

Thompson expressed similar thoughts.

“Do you know my problem with all this?“ Thompson said. “We made a deal … we’re West Texans. Our word is our bond. Besides that, it’s a sister municipality that we work very closely with especially during the pandemic.”

Since he’s a “lame duck,” Sprawls said he’s not surprised Joven didn’t tell him about his intentions. Still, he’s not pleased.

“I think it’s less than professional,” he said.

“I think what the mayor did was unethical if he didn’t tell anybody what he was doing,” Sprawls said. “He didn’t tell the council that I’m aware of.”

Rumors have been running rampant the new council plans to move to fire Marrero and Joven’s actions have exacerbated those fears, White, Thompson and Sprawls said.

“The worst case scenario is that we lose our city manager/council form of government. We hire trained, experienced and effective people to be our city administrators. These are not folks that are just appointed. They are not people, and I don’t mean to make it sound light, but they are not just people who got enough votes,” White said.

Those people are crucial to the success of the city, White said.

“I don’t want any group no matter what it is coming in and feeling that they are far better equipped to run a multi-million dollar entity such as the City of Odessa,” White said.

White said she is asking for everyone to pray for the city council members to “make good decisions.”

Sprawls said the city council should act like a board of directors that hires managers and let them manage things.

“Well, our dysfunctional city council has not done that in the last two years,” Sprawls said. “There’s too much over-reach and it’s very sad.”

He fears what will happen over the next two years.

“I don’t know whether they have ulterior motives or if they just have such large egos, but it’s going to be difficult to slow them down. Ultimately, the public can make a difference, but it’s going to take some noisy folks,” Sprawls said.

He asked several people to run for his seat, but several said they didn’t want to get “caught up” in all of the drama.

“If you want to know what kind of a SOB you are, just run for city council. Somebody will tell you,” Sprawls said.

As for the rumors about Marrero, Sprawls said he hopes they aren’t true.

“I’d like to believe it’s just a dirty rumor around the streets. I like Michael Marrero. I like his style. I like his candidness and his leadership skills,” Sprawls said. “I’d like to think it isn’t going to happen, but it may.”

ARPA

White said she even wonders if the $3 million can even be used for the firefighters’ raises.

It’s her understanding the ARPA funds are intended to reimburse cities for losses due to COVID-19, for example, for emergency supplies.

“As far as I know it could refund you or replenish what you spent on overtime for COVID relief, but not to pay for raises,” White said.

Underpaid employees

Back in July, the Odessa City Council voted unanimously to hire an outside firm to look at all city employees’ pay in comparison with other communities after OFR employees attended several meetings pleading for raises. More than 70 firefighters have left the department over the last two years, many of them citing pay as the reason.

The council agreed Evergreen Solutions should study firefighter, dispatcher and police officer pay first and then look at the salaries of general government employees.

An Evergreen representative recently told the city council that bringing all employees up to the same level as their peers in other cities would cost the city a minimum of $7.5 million to $9.5 million a year. However, he cautioned the council that amount doesn’t include an increase in the ancillary costs associated with benefits, nor would it address compression.

Evergreen’s Michael Misrahi told the council Odessa’s public safety employees are paid at least 15% below those in peer cities, but those numbers do not include the add-on pay firefighters are given for certain certifications they acquire as part of their jobs.

Preliminary figures also show some general government employees are being paid as much as 20% below their peers, but on average, the city is paying its general government employees 4-7% below peer cities, Misrahi said.

While all of the council members agree firefighters need to receive raises, half of the council have expressed their concern that focusing just on firefighter pay is doing a major disservice to other first responders and general government employees.

Fairness in question

Hearing Joven told Tippin the $3 million would go to firefighter pay alone is distressing, Sprawls, White and Thompson said.

The entire council voted to wait to discuss raises until the compensation study is complete and it isn’t, they said.

“How do you tell your public works folks, you guys are important, but not as important as these other guys?” White asked.

The people who work in the city’s water treatment plant or repair city water lines are critical personnel and they shouldn’t be bypassed, White said. The same is true of people in other city departments, she said.

“There’s some that have not considered our parks to be that important. I think the comment was ‘Well, they’re nice,’ but you’ve got to look at everything. There are a lot of things that make a city desirable,” White said.

If the new council only gives firefighters raises, there’s going to be a lot of push back, Sprawls said.

“My garbage guy is a real important guy to me. I really don’t want him to quit coming by,” he said.

The future

Sprawls, Thompson and White are also concerned about how the city is going to sustain whatever raises are approved by the new council.

“Three million will make a difference this year, but it’s not going to make a difference for the years to come. The city still has to figure out where they are going to cut and what else they are going to be able to do to maintain those raises from now on,” White said.

Sprawls agreed the $3 million will help for a year, but said ultimately the city is going to have to rely on increased property taxes to cover the cost of the raises. Sales tax revenues can’t be relied upon, he said.

The City of Odessa can’t run a deficit, Sprawls said.

“You’ve got the tax and spend Democrats and the tax cut and spend Republicans. It’s disgusting to me,” Sprawls said. “Here these guys tout themselves as being such good conservatives and that’s what West Texas wants is a good conservative counsel and they’re out there trying to spend money like a drunk, without a bond election, without approval from the council.”

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