County files objection to Children’s Hospital consultant fees
ABC-7 has confirmed the El Paso County has made another move in the courts against Children’s Hospital.
This time, to keep Children’s from paying hundreds of thousands of dollars to a firm guiding it through bankruptcy.
Both AlixPartners and the new CEO, Mark Herbers, were hired in late February with hopes of keeping Children’s from going under. But the hospital that El Paso taxpayers are still paying for is spending about $220,000 a month for their services.
“It could be a lot more affordable,” said El Paso County Commissioner David Stout. “These exorbitant fees they are paying to AlixPartners and Mark Herbers to come in here and do this, I don’t think its fair to our community. It’s not fair to our taxpayers to have to foot that burden.”
Stout argues the money paid to AlixPartners could be used to repay UMC, which he calls a debt to taxpayers.
“We have a very tax poor community and its just not fair for some firm from out of town to come in and reap such great benefits on the backs of our taxpayers.”
At $220,000 a month, the Children’s Hospital’s bill for AlixPartners has already topped a million dollars. With the bankruptcy trial date set this week for late October, that amount is expected to reach more than $1.7 million. And if the case drags on, it could top $2 million dollars in consulting and management fees.
The County says Children’s hasn’t shown AlixPartners has “reduced expenses or provided a foundation for reorganization.” It also calls the hiring of two in house attorneys at AlixPartners at $40,000 a month “hog-like” behavior. And it wants a quarter-million dollar “success fee” stricken by the court.
“If things get bad enough, we may have to raise taxes, which I really don’t want to do, because that’s not what the taxpayer was promised in the beginning with this children’s hospital,” Stout said. “But in the end, to be able to keep UMC healthy, we may have to raise taxes.”
Children’s officials are not commenting on these items.
On Tuesday, the bankruptcy judge, Christopher Mott, had Children’s create a separate account to pay its attorneys and advisors so those payments can be tracked.
