By Karen Harvey

 An update on the effort to save Chautauqua County Nursing Home from privatization


In January 2013, the Chautauqua County legislature voted not to sell their state-of-the-art public nursing home to a Chicago based nursing home chain. The Republican majority announced Monday, February 12 it will attempt to change the law requiring a 2/3 vote for any decision to sell county assets -- to a simple majority -- at the February 27 legislative meeting.  The vote to change the law requires a simple majority.

The Chautauqua County Nursing Home (CCH) is described on its website as a:”216 bed facility in Dunkirk, New York, in a rural setting; our staff provides a home-like atmosphere for our residents. The 280 member staff provides around-the-clock medical care to the elderly patients as well as physical, occupational and speech therapy.”

New York State is pushing to sell off publicly owned nursing homes.  With the federal government, it is coordinating a drive to force counties to divest themselves of their historic responsibility of providing a last-resort safety net for their incapacitated elderly and severely disabled.[1] County legislators are being herded into enabling a privatization agenda, the further dismantling of the social commons.


Watching the plight of publicly-owned nursing homes over the last few years, we[2] have heard from hard-pressed legislators from three western New York Counties (Steuben, Ontario, and Chautauqua) that “in just a few years, there won’t be anything left of county government.”  Services are being “contracted out,” sold off, closed down.  The centralization process will induce the further de-politicization of the population and loss of public assets.[3]

For the Third World, the same sort of privatization process was conducted via the IMF and the World Bank through imposing ‘loans’ with the proviso that the governments require the respective nations to cripple or outlaw their unions and sell their public assets (the commons). Those were the ‘conditionality’s’ imposed.[4]

 A similar sort of agenda is being put in place across the United States. Cheap money is available to insiders and various disaster capitalists to buy up public assets from hard-pressed cities, counties and states.  Case in point, a cursory Ron Paul-induced Congressional audit of the Fed in early 2012 discovered that the (privately owned) Federal Reserve issued $16.1 trillion to some 30+ US and other international banks. None of that money went to financially strapped cities, counties and states.  Just the opposite: the money was issued to hasten the privatization of cities, states -- and nations.

 Here in Chautauqua County, we’re fighting a losing battle – but defeat isn’t inevitable.[5]

 Politically ambitious, County Executive Greg Edwards is determined to sell the Home, even going so far as undermining the value of the facility to make it appear that the home is a huge financial burden to county taxpayers.[6]  For Edwards, selling the Home means crippling the unions: a feather in his cap, should he run for governor. Ed Cox, NY State GOP chair, recently touted Edwards as a good choice. After all, Edwards was Carl Paladino’s running mate for NY governor in 2010.  Edwards’ ambitions hardly conflict with the State’s determination to drive counties out of health care.[7]

 Lack of Transparency

Greg Edwards refused to be interviewed by us.[8] He’s forbidden hospital administrator Tim Hellwig from speaking with us. Nor will the Home’s financial officer, Colleen Wright, answer our questions. Both were appointed by Edwards.

The closest thing we have to an independent audit of the Home is the Center for Governmental Research (CGR) Report which was commissioned by the legislature at a cost of $80,000 to look at the financial state of the nursing home.  On at least two key financial questions, the CGR’s figures were dramatically at odds with Edwards’.  Don Pryor, director of the CGR study showed that on average the Home realizes a “surplus” of over $100,000 a year. Edwards claims the Home is costing taxpayers $9,000 a day. What does this mean? Edwards’ Karl Rove-like mantra is not meant to explain anything.  According to the CGR Report, the Home has a $5 million fund balance and is not costing taxpayers any money.  Edwards says that when the Home is sold for $16.5 million, the County will realize $6 million. Don Pryor counters that after costs are paid, the County will see only $600,000.  Wild discrepancies.  Note, the CGR is truly an independent research facility, not about to enter into a partisan fight.

Though we aren’t allowed access to the numbers, it appears that the agenda-driven Edwards is resorting to selling the Home to get a quick sum of cash to resolve other financial problems (in addition to the County Home) that have occurred during his tenure.

Sell and get off the Medicare hook

A sizable number of people are under the impression that if the County Home is sold, the County won’t be required to make medicare payments.  Not so. The tax bill will still be picked up by the county, but the money will go to the out-of-state private owner who doesn’t have to report his profits.  As a publicly-owned home, money is returned to infrastructure and staff continuity, as a valuable part of the economic climate of the hard pressed North end of the county.


Those individuals with assets (houses, bank accounts, pensions etc.) surrender everything when they enter a nursing home. While this aspect of the story doesn’t compute with bottom-line politicians, there remains an important sense of psychological security and well-being for residents who feel that they are part of the ownership of their county home, as opposed to being a paying customer during the last years of their lives.

The politics

Politically, the county is made up of 25 elected legislators: 13 GOP, 11 Dems, one Green. Standing up to Greg Edwards (R) are nine legislators: Lori Cornell (D), Bob Whitney (D), William Coughlin (D), Keith Ahlstrom (D), Tom DeJoe (D) Bob Duff (R), Shaun Heenan (D), Tim Hoyer (D) and Bob Scudder (R). [9]

If the above legislators had Edwards power (office), a variety of creative ways could be articulated to increase the viability of the Home. A populist legislator, with an understanding of the value of the ‘public commons,’ would point out that especially in this uncertain economic time, local governments should do all they can to preserve their much needed social institutions from the peril of the disaster capitalist free market. 

Cost cutting and revenue enhancements for the Chautauqua County Home proposed by the CGR report & the legislative ad hoc committee have not been implemented.
According to Republican leader legislator Larry Barmore none of the current county deficit can be attributed to the county home; according to legislator Chuck Nazzaro (budget expert), county property taxes will be reduced in the current budget (modestly).  

Government bias against government

Over the past year the State has dispensed over $300 million in free tax money to private and non-profit nursing homes.  These institutions don’t even have to match the grants they get, unlike the county nursing homes (Intergovernmental Transfer Grants - IGT grants).  Note: the tax money (Health Care Efficiency and Affordability Law - HEAL grants now in stage 20) given to Lutheran Social Services Nursing Homes of Jamestown ($23 million) was more than enough to buy the publicly-owned Chautauqua County Nursing Home. It’s more money than the County Home has gotten in some 20 years.[10]  People who say government can’t do it better shouldn’t be in government.  

 North County – South County divide.  The southern end of the county is anchored by Jamestown; non-union residents tend to be hostile to keeping the Home; South county has a large number of not-for-profit nursing homes that give excellent care, as opposed to the north end of the county (Durkirk is the largest town) has very few nursing homes and none that are not-for-profit). The bulk of the population (hence greater representation) lives in the southern end of the county. The CGR Report did not significantly explore the economic impact on the North county, which would be severe – especially since two major businesses recently closed in the north end of the county.

 Caveat venditor

Though the CGR report was not commissioned to look into the qualifications of the proposed buyer, it expresses serious caution about the single buyer, prompting  lawmakers to look carefully into problems that might arise if they sell to Avi Rothner.

Union Hostility

Hostility to unions is a major factor in legislators’ capitulation to the drive to sell.  Historically this hostility is fed by the (privately owned) media and organizations like the National Association of Manufacturers and now, the Chamber of Commerce[11].  So elected leaders – unsure of the real financial situation of the home and the county , trying to adhere to the wishes of their constituents (at least the vocal number of them) or their political party, become part of the ‘sell’ mantra.  

Public indifference to the commons

It will all go on the chopping block: nursing homes, schools, child care, prisons, highways, police, and the military: all for sale.  A public that doesn’t value its heritage over the capacity of private enterprise to take up the slack is in danger of becoming irrelevant. What was once “commit to caring” (Steuben County nursing home motto) is now: Pay or Go Away


[1] “A tradition of caring since 1832,” proclaims Chautauqua County Nursing Home’s website.  A one-hundred-and-eighty-year tradition out the window; the new tradition: profit.  Eleven county nursing homes in NYS  of forty-four were sold over the past several years. While the State provides matching fund grants to counties with publicly-owned nursing homes (called IGT grants), the so-called not-for-profit nursing homes are getting sizably larger grants from the New York State’s HEAL program ($301 million in 2012). One of those recipients was Jamestown’s Lutheran Social Services, which was given $23 million. These taxpayer-funded ‘grants’ enable privately owned and not-for-profit nursing homes to make improvements that publicly owned facilities are forbidden to make!

[2] Journalists Roy Harvey and Karen Jane Engstrom Harvey founded Snowshoe Documentary Films in 2000. Karen was a photographer and photo editor with the Chicago Tribune for over 20 years, retiring in 1998. Roy retired in 1999, ending his career as a City of Chicago television producer.

[3] As county governments strip themselves of the power to do anything but submit to those above,  it will become much easier to implement such profitable enterprises as ‘fracking’ -- against an increasingly ill-informed and demoralized population.  The phenomenon coheres with the UN’s ‘Agenda 21’ for America.

[4] Shock Doctrine (The Rise of Disaster Capitalism), Naomi Klein, 2007, explains the mechanics of privatization.

[5] Edwards and colleagues have indicated that they will change the rules, enabling the legislators to sell with a simple majority as opposed to the two-thirds majority which is now the law.

[6] An example of this “sabotage” is the gas well, a story touched on in “Don’t Sell Our County Home,” a 31-min. documentary available on YouTube. The gas well was installed three years ago at the expense of the home ($400,000); the well would have earned some $300,000 in revenue annually for the home, but the County Executive refused to have it hooked up. In effect, the County Home lost over $1 million (factoring County Home spent to install the well) over the past three years -- because of the County Executive.

[7] Legislators and the public are sold on the false notion that the State’s highly regulated inspection services ensure that private and not-for-profit nursing homes give quality care.

[8] Our first video on the plight of the nursing home was posted Nov. 2011 on YouTube. As such, we were on record, from Edwards’ perspective, of giving the union (CSEA) side of the story.

[9] The Center for Governmental Research (CGR) was commissioned by County legislators – at an agreed-upon price of $80,000 – to evaluate the viability of the home. After several months of study, the CGR issued its 130-page report.  In effect, the CGR outlined ways the County could bring its financial contribution down to $500,000 to $1.3 million, costing homeowners between $6 and $17 per year.

[10] HEAL grants (Health Care Efficiency and Affordability Law of New York) from the state were awarded to LSS - $23 million and Heritage Homes $5 million. Note, county governments, in their rush to sell, and cognizant of the State bias against counties, help local non-profits get HEAL grants to buy their publicly-owned nursing homes which can’t stay in the business because rules disallow coherent use of their facilities and capital.

[11] Case in point, Todd Tranum, CEO of the Chautauqua County Chamber of Commerce and executive director of the Manufacturers Association of the Southern Tier, frequently uses his weekly column in the Jamestown Post-Journal to push privatization. In one of his articles, Tranum says “in five to 10 years it is conceivable that the financial situation at the facility could become so tenuous that there may be no alterative but…to close the facility…our legislators can move the process forward now, by selling the home.” (Oct. 14, 2012) This is fear tactics, fear talk.  Potential buyers like Avi Rothner love it because they know Medicare and Medicaid will keep coming long enough to make it profitable.  After all, Americans have been forced to pay into Medicare since 1964.  And anyway, in the financially tenuous time that Tranum posits, wouldn’t it be good to have a facility that cares for the least capable elderly? But this is not Tranum’s concern. He thinks high taxes are a disincentive to investment in the county; the problem is, Tranum has it wrong. The County Home, publicly owned as it is, adds significant value (real estate and otherwise) to the County; federal and state dollars that are spent locally, not siphoned off to Chicago…