Attorney General T.J. Donovan with Department of Disabilities, Aging and Independent Living Commissioner Monica Hutt
Four residential homes for seniors will continue to operate under state control indefinitely after a judge on Monday extended what had been an emergency order.
The January 25 ruling by Washington Superior Court Judge Mary Miles Teachout credited earlier allegations of food shortages, utility shut-off notices and "dysfunctional" management that failed to even cash rent checks at what are informally known as the Pillsbury homes.
The owner of the facilities, which are home to 200 residents, is in default on a $24 million loan he executed to buy the South Burlington and St. Albans properties in 2017.
Other bills went unpaid, too, the ruling says. Employees paid for food out of their own pockets. And when trash piled up because a hauler wasn't paid, one employee carted it off herself.
Three of the facilities are licensed residential care homes: Homestead at Pillsbury in St. Albans, and Pillsbury Manor South and Allenwood at Pillsbury Manor, both in South Burlington. The fourth, Harborview, also in South Burlington, is an independent living facility.
Texas investor Andrew White bought them in May 2017 from their longtime Vermont owners, the Larkin family.
Just a year later, troubles emerged. New information cited in the ruling says that White was notified last June that he was in default on the $24 million loan. He ignored the notifications, according to the ruling. This failure to deal with the situation "creates extreme instability for the future of the facilities," Teachout wrote. Residents "are quite justified in concluding they may lose their home" and that receivership is necessary to stabilize the situation, she found.
White and his attorneys fought the receivership in hearings that concluded earlier this month. White testified that many of the problems cited were overblown, or just temporary issues that he could remedy, according to the ruling.
He also testified that if the homes went bankrupt, he would attempt to buy them out of bankruptcy.
Teachout was unconvinced, and she repeatedly noted examples of baffling and bizarre management as well as "corporate stonewalling" from Texas when frustrated employees called about unpaid bills and other problems. She wrote that without receivership, there was "no basis for confidence" that White would address the mortgage holder's claim and allay fears about the future solvency of the homes.
As of mid-January, all vendors have been paid, most rents have been collected and the properties have a $4 million bank balance, according to the ruling. Temporary nurses have been hired to alleviate nursing shortages.
But it's unclear what the longer-term future holds for the properties. The ruling said that state-appointed temporary receiver Douglas Wolinsky, a Burlington attorney, has been stymied on some fronts by White and his maze of at least 12 limited liability companies connected to the properties.
Attorney General T.J. Donovan had obtained emergency state receivership last November on behalf of the Vermont Department of Disabilities, Aging and Independent Living. The department oversees and licenses long-term care facilities. It had cited the homes for numerous violations, but got little response, according to court papers.
On Monday, Donovan called the new ruling a step toward stability.
“We hope this result brings peace of mind to the residents of the Pillsbury facilities and their families,” said Donovan. “When vulnerable Vermonters are at risk, we are going to step in to protect them. Food security, housing, health — these are nonnegotiable. We hope that the Pillsbury facilities will now thrive, going forward.”