As Sea Mar closes on building site, VHCD still seeks answers

Sea Mar Community Health Centers purchased Vashon’s Spinnaker Building in late September.

Sea Mar Community Health Centers has now closed on its purchase of Vashon’s Spinnaker Building, a property in the center of Vashon the organization said it would purchase in late September.

According to property records, the sale of the building, for $1,150,000 million, was recorded on Nov. 1.

The building’s former owner, Spinnaker Building LLC — an entity controlled by Scott Shapiro — had owned the building since 2008, when it purchased it for $1 million. In recent years, the building has been used as a co-working space, capitalizing on its layout, since the late 1980s, as the headquarters of Software Research Northwest, a local software company serving clients in higher education.

The sale’s finalization comes as Sea Mar continues to negotiate its continued occupancy of Vashon Health Care District’s (VHCD) Sunrise Ridge Clinic — even as it eyes the construction of a new clinic on the Spinnaker building site. The new clinic, Sea Mar executives have said, will be operated without the generous VHCD tax subsidy which previously supported its operations on Vashon.

VHCD has said, in recent weeks, that it is now close to an initial agreement that would allow Sea Mar to continue to operate at Sunrise Ridge until at least June 30, 2023.

This agreement, said commissioners, is contingent upon Sea Mar’s agreement to retroactively honor a proposal they made to VHCD in April — to reduce VHCD’s tax subsidy of Sea Mar’s operations at the clinic from $1.5 million per year to $1.1 million per year.

Sea Mar could stay longer at Sunrise Ridge

As of press time, VHCD is still waiting for Sea Mar to respond to a Nov. 15 deadline regarding a lengthy document created by VHCD, called Proposed Acceptance Criteria.

The document, dated and sent to Sea Mar on Oct. 12, outlines a broad set of criteria under which VHCD would agree to extend the sublease of its Sunrise Ridge Clinic for a longer time frame, as Sea Mar builds its new clinic on the Spinnaker Building site.

Sea Mar’s response to the document is important, VHCD commissioners said.

“Given the island’s history of being abandoned by off-island service providers and the questions being asked to the District by its constituents, the District believes it should, and has, developed criteria to evaluate the credibility of Sea Mar’s plan for serving the island,” the document states.

Mary Bartolo, executive vice president of Sea Mar, did not initially respond to an inquiry from The Beachcomber, last week, about whether Sea Mar would meet the Nov. 15 deadline for its response to the document. At press time on Tuesday, Nov. 15, Bartolo responded, by email, that she would respond to the newspaper’s questions as soon as possible.

But in an interview on Voice of Vashon’s “Brown Briefly” radio program last week, Bartolo and other Sea Mar executives stated that establishing a longer timeline to leave Sunrise Ridge is their goal as well.

“We hope that we can work out an agreement with the health care district for a longer period of time so that we can build a new facility at the Spinnaker site that will be able to accommodate a much more efficient clinic operation,” said Mike Leong, legal counsel to Sea Mar.

Document outlines conditions

The criteria contained in the VHCD’s document, sent to Sea Mar, were developed in collaboration with VHCD’s strategic planning task force — a group comprised of commissioners and longtime island health care advocates.

Under the terms stated in the document, VHCD would require Sea Mar to agree to fully fund the operations of a Vashon primary care clinic for 10 years, and provide a proforma to VHCD showing how it intends to fund net clinic operating losses.

The terms also ask Sea Mar to specifically describe how it will engage with the community on a broad range of issues — ranging from the design process of its new clinic to coordinating with local organizations, including Vashon Youth & Family Services and other island-based social service providers.

Addressing the possibility that Sea Mar could decide to exit the island earlier than 10 years, the document asks for assurance of a 12-month notice in that case, as well as a right of first refusal to sell its assets to VHCD.

During VOV’s interview with Sea Mar executives last week, Leong said he could not commit to a specific time frame for Sea Mar’s operation on Vashon, though he said it was the intention of Sea Mar to serve Vashon long-term.

“We don’t know what is going to happen with the funding world [for health care] on the federal or state level,” said Leong. “I don’t know if we can say definitely [we will be here] for 10 years or 40, but we do intend to stay indefinitely.”

State funding at play

At play in the issue in Sea Mar’s plans is $3 million in state funding allocated to build a new clinic originally awarded to the clinic’s former provider, Neighborcare Health, in 2018.

The funding originally came in response to a request to Sen. Sharon Nelson, a Vashon resident, by members of Vashon-Maury Health Collaborative, a nonprofit helmed by health care advocates on Vashon.

In 2021, that $3 million appropriation was transferred to Sea Mar, when it took over the operation of the clinic after Neighborcare left in 2020.

VHCD had hoped to tap that funding for its own new health care clinic for 2.3 acres of land it recently purchased, on the west side of the highway south of Kathy’s Corner garden center, on which it announced it would build its own clinic, prior to Sea Mar’s severance of its relationship with VHCD.

In response to a question from The Beachcomber, Mary Bartolo, Sea Mar’s executive vice president, said on Tuesday that she would soon answer whether Sea Mar would now begin the process of tapping the $3 million allocation for its construction project on the Spinnaker Building site.

VHCD set to pass budget

This week, VHCD commissioners are set to pass a budget for 2023.

The budget calculates overall income to the district of almost $2 million, assuming the same levy amount for VHCD in 2023 as in 2022, with an additional $46,600 in income from payments made by Sea Mar, through June 30, 2023, as a sub-lessor of the Sunrise Ridge clinic.

In recent board meetings, some commissioners have signaled their support for supporting non-primary care service goals in the coming year.