Friday marks three weeks since the bankruptcy auction for Delaware County’s Crozer-Chester Medical Center and Springfield Hospital, and it’s not clear how much progress has been made.
Closing the sales depends in part on local authorities agreeing to tax deals that set the assessments at the transaction prices of $10 million and $3 million, respectively, for a limited period of time.
Upland Borough, which is home to much of Crozer-Chester, is working on a property tax agreement that will be filed in court, borough council president Christine Peterson said Thursday. “We anticipate that Upland Borough Council will take action in favor of that stipulation once it is complete,” she said.
A representative for Chester Upland School District did not respond to a request for comment Thursday.
If the school district also agrees to a tax resolution, a company called Chariot Allaire Partners LLC is clear to acquire the shuttered safety net hospital for $10 million.
Yoel Polack, who is principal of Chariot Equities and has been talking with local officials and prospective healthcare providers about plans for the hospital, said last Tuesday that he expected to issue what he called a “comprehensive memo” on the property this week.
Polack said in an email Thursday that there was still no update, but he is hoping to have something in the next few weeks.
The backup bidder for Crozer-Chester is the same group that won the auction for Springfield. The auction led to Chariot increasing its offer by $3 million.
Both facilities are owned by Prospect Medical Holdings, whose next bankruptcy hearing is scheduled for Tuesday. Items to be considered include Springfield Township’s lawsuit aiming to force Prospect to improve safety on the hospital campus that it closed in 2022.
Bankruptcy Judge Stacey Jernigan granted a temporary injunction blocking Springfield from taking any action against California-based Prospect.
Another topic is a proposed $1.5 million settlement of a lawsuit filed on behalf of Crozer employees who did not receive 60 days notice before losing their jobs in April and May when Prospect closed Crozer-Chester Medical Center and Taylor Hospital, which has since been sold. Federal law requires employers to provide two months notice of layoffs.
A stalemate in Springfield
Lawyers for Prospect identified Restorative Health Foundation and Syan Investments as the auction winner with a $3 million bid. But it appears a tax agreement that would assess the Springfield property at the purchase price is nowhere near completion.
“The township has no interest in agreeing to a tax deal without having a better understanding of the buyer’s intended use of the site and whether it aligns with the township’s comprehensive plan,” spokesperson Pete Peterson said in an email.
A representative for the winning bidders, Aminah Shabazz Perez, told the Delaware County Times recently that the buyer was in talks with two health systems about moving into the hospital, but one of them told township officials that was not true, Peterson said.
“In addition, the township already did its due diligence prior to the bankruptcy auction and engaged in discussions with representatives of different health systems,” he said. ”There was no interest in the property due to the cost of improvements the facility would need.“
Attempts by The Inquirer to reach Shabazz Perez have not been successful. Prospect did not respond to request for comment on the property tax situation.
The Springfield School Board would also have to agree to a tax settlement, but has not voted “on any proposed resolution of the outstanding tax appeals or the tax assessments relating to the Springfield Hospital and parking garage properties,” the school board’s solicitor Mark Sereni said Wednesday.
The face value of the Springfield School District’s latest claim in bankruptcy court is $1.43 million. Under an abandonment order signed on Oct. 14 by Jernigan, the district would receive a general unsecured claim, which is not likely to be worth much.
If Prospect abandons Springfield and Crozer-Chester, the municipalities would have to foreclose on the properties to collect any of the money Prospect owes them.
