Hospital District Race Centers on Fund Use, Community Role

Two years ago the South Bay Hospital District went out of the business of running a hospital and became a dispenser of money for public health programs serving Redondo Beach, Hermosa Beach and Manhattan Beach, the cities that make up the district.

Since leasing the community hospital to a profit-making medical corporation for $3 million a year, the district has converted its business and investment activities to those of a foundation and developed guidelines for giving grants. But it also experienced months of internal strife--the result of animosity among district board members--and went eight months without an executive director after the first director was fired. Philip R. Valera took over April 1.

In two years the district has given 12 grants totaling $1.3 million for such programs as crisis aid for rape victims and battered women, meals for the elderly, mental health, transportation for medical patients, child care and a halfway house for recovering male alcoholics. The largest grant, $809,000, has gone to a long-term health program in four school districts.

But in the Nov. 4 election for two board seats, the focus appears to be on whether the board has done enough with its financial resources and whether it has become a visible and active part of the community.

Criticized by 3 Candidates

Three of the four candidates, including one incumbent, say the board has fallen short of its potential to become a part of the community and improve local health services by aggressively filling gaps in such areas as child care and senior citizen housing.

In the running are Gary L. Brutsch, 44, a retired Los Angeles Police Department detective supervisor and former Hermosa Beach City Council member who is now a public relations consultant; Dick Fruin, 47, an attorney from Manhattan Beach who formerly served one term on the board; incumbent Jean G. McMillan, 58, in office since 1980, and 19-year incumbent Gerald R. Witt, 59, board president. Terms are four years and board members are not paid.

Brutsch said he has “little knowledge” about the decisions behind the grants that the district has made but that the district “has the responsibility to put as much money back into the community as possible,” and he is not sure that is happening.

He said, however, that the board’s biggest problem is isolation from the cities it serves. “It should appoint people in the communities, including the city managers in the three cities, and ask them to help” by reporting on community needs, he said. He also is calling for a citizens advisory board, saying, “There is a need to aggressively network with the cities.”

Fruin: ‘Lacks Vision’

Fruin, defeated in a reelection bid to the board in 1984, said the district “lacks a vision of what (its) role should be” and that it has to see itself as more than a grant-making agency. “I would like to go back on the board to get the district off to additional directions,” including education and its own projects, he said. “I don’t say that what they’ve done is bad. I just say they could be doing much more than they have been over the last two years.”

Fruin, too, said the board is still a largely unknown quantity to people in the three cities, but he said it is well known to the agencies responsible for health care. “The agencies are very excited about what the South Bay Hospital District can do in the future,” he said.

McMillan, a Manhattan Beach resident and former city clerk there, said the tumult that once marked the board subsided several months ago. But she said the board still has not accomplished what it should. “We are being very passive, sitting back and waiting for organizations to come to us, then we nit-pick them apart,” she said, adding that the board has not moved to create programs of its own or grant enough money to agencies that have specific goals.

Asked what she, as a board member, has done to change this, McMillan said, “I’ve tried to get the board going, but the board is content with itself.”

Witt Defends Board

A lifelong South Bay resident and owner of a roofing and sheet metal company, Witt defends the board, saying that what people call a lack of aggression and insufficient grant-giving reflect the district’s efforts to learn its new role as a foundation, its reasonable caution in handing out public money and the longtime absence of an executive director to provide leadership and promote the district in the community.

“We started out slowly (giving grants) to be sure we were right,” he said. “This is not our money, it’s the district’s money.” He said people look at the $3-million-a-year income “and say this should go to the community, but we have to consider our long-term debt (stemming from the past hospital operation), budget expenses and a contingency fund in case we have to take the hospital back.” (The hospital lease, to American Medical International, runs until the year 2014.)

Witt said people are now “getting more from the district in health-related community programs” than they have since the district was formed to build the hospital in 1960.

While declining to predict the outcome of the election, Witt said it would be “logical” for the incumbents to be returned. “We know where everything is coming from, where we’re going,” he said. “New members will take a year or so to find out what’s going on.”

Brutsch: ‘Turnover Healthy’

But Brutsch said it is time the board had new faces. “Some people run and run. It’s healthy to have turnover, an evolution of thought, not the same folks in the same function,” he said. Brutsch had pledged to serve only one four-year term on the Hermosa Beach City Council when he ran in 1982 and stepped down last April.

Brutsch, Fruin and McMillan say the district, while continuing to make grants, also should take the initiative in creating programs.

Brutsch said the South Bay has many working parents who cannot afford child care and the district should acquire a location and provide that service. He also said it should work with state and federal governments to create housing for senior citizens, who, he said, make up 20%of the local population.

McMillan said the district must “work for housing for the frail elderly,” adding that she is independently working to provide support for people with cancer, a project that the district will be asked to fund. McMillan said that if she has any conflict of interest as a board member when this comes to the board, she will declare it.

More Facilities Desired

Fruin said the district should consider building facilities near South Bay Hospital to augment hospital services, such as a skilled nursing home.

“We can be creative,” he said. “We have the funds to do it.”

While all candidates gave high marks to American Medical International for upgrading and modernizing the hospital, McMillan criticized the corporation for failing to do two things she said the lease requires: move the chemical dependency unit to an unused hospital the district owns in Hermosa Beach and construct a second medical office building on the South Bay Hospital grounds in Redondo Beach.

She said that the old hospital on Pacific Coast Highway, which is boarded up, is an eyesore and that she is “appalled at their lack of commitment to that project.” Hermosa Beach also would like something done with the property, she said, which city officials confirmed.

Kenneth T. Ono, the hospital’s executive director, said the lease calls only for using the Hermosa Beach property “for a health service.” Relocating the dependency unit proved unfeasible because of the condition of the building, he said, and a proposal for a medical office building there was rejected because it is too far from the Redondo Beach hospital. He said AMI is considering a developer’s proposal to lease the site for 60 years for a nursing home.

Ono said a medical building at South Bay Hospital cannot be built until AMI obtains an additional 30-year lease for the building site. That is under discussion with the district, he said.