MOB Rules

The acronym used by North Broward Hospital District staff for the $32 million medical office building project -- "MOB" -- says it all. Meyer Lansky would have been proud.

As I wrote here November 6, the publicly funded district intends to pay a few big-wheel developers $170 million over 55 years for it, a throwaway of about $100 million. In addition, the district is set to spend more than $4 million upfront for the land across the street from the Broward General Medical Center, where it is to be built.

That the deal was hatched by former NBHD chief financial officer Patricia Mahaney, who was recently sentenced to 14 months in federal prison for embezzling money from the district, only solidifies its place in Broward's history of corruption. That she concocted it with her close friend and business partner M. Austin Forman, a consummate influence peddler, makes it an absolute classic.

Forman, who initially optioned the land for the MOB, claims he dropped out of the deal after the FBI began investigating. But he is still listed in state records as a principal of the company formed to make the deal, Andrews Avenue Properties and Investments, which he founded with long-time partner William Murphy. The only change listed in the records came in September, when Forman stepped down as registered agent -- and listed his brother, H. Collins Forman, in his place. Long-time downtown developer Terry Stiles, another Broward insider, is set to build the project.

At last Wednesday's board meeting, NBHD commissioners didn't complain about the MOB, which they approved in February 2002. Instead they groused about my column. Board chairman J. Luis Rodriguez announced on the dais that "the New Times article unfairly took a shot at everybody" and portrayed all board members as "crooks and cronies of the governor."

I didn't exactly say that last part, but I wouldn't object to the use of the term cronies, and I'm certain the Jeb Bush-appointed board approved a crooked deal. After the meeting, I asked Rodriguez, a lobbyist who abstained from the MOB vote because he'd worked for Stiles, if he thought the deal was justified. "I'm waiting to see that Fishkind report, which was done by a well-respected outside group," he said. "You have to look at it on its merits."

Ah, the Fishkind report, the document that is ballyhooed by district officials as proof that the MOB is A-OK. Orlando-based Fishkind & Associates was hired by the district to analyze the deal this past summer and came back with a glowing approval.

The endorsement didn't really surprise me; it's a dirty little secret that most consulting firms routinely color their arguments to match their clients' expectations. They want to get hired again, after all. And I've found that company president Hank Fishkind, an economist by training, is a mercenary of the first order.

When I started asking questions about the deal late last month, district spokeswoman Sara Howley told me that the Fishkind report proved the deal was kosher and that all I needed to do was put in a public records request for it.

I made the request on October 28 and was promptly stonewalled for two weeks. District CEO Wil Trower's assistant, Maryanne Wing, told me the report wasn't finalized. I informed Wing that draft reports were public information, but the district wouldn't budge. On November 12, I sent her a Florida Attorney General's opinion that stated point-blank that draft reports are public, and, later that day, they finally coughed up the study.

Only it wasn't a draft -- it was dated and signed on October 23, 2003, five days before I made the initial request. Gives you an idea how NBHD operates. It managed to lie, refuse to be accountable, and break public records laws all in one fell swoop.

Then I read the report and found that old Fishkind really outdid himself. The flimsy, seven-page study -- and I use that term loosely -- was clearly written from a developers' standpoint, rather than for taxpayers. He justified the deal by concluding that the $3.1 million annual lease seemed to represent a fair annual payment.

What he failed to mention was that the district -- which receives about $160 million in property tax dollars and $200 billion in federal Medicare/Medicaid funds -- was taking all of the risk associated with filling the building with tenants, otherwise known as "the hard part."

"The district has no construction or development cost risk," Fishkind wrote. "This is advantageous for the district, but it increases the risk to the developer."

Poor little developer. All such construction work must be bonded, though, so the developers aren't really taking much of a chance. Fishkind could have noted that the developers are taking a risk by paying to option the land, some of which has yet to be purchased. But that wouldn't have been true, either, because NBHD has quietly been handing Forman's partner, Murphy, some $25,000 a month to cover any option costs since March 2002. That's $525,000 so far -- and that money is gone whether they build the thing or not.