The deal is off!
Metro says its cutting ties with the developer who has been running Autumn Hills. And, the mayor says it's in part because of what NewsChannel 5 Investigates exposed out at the city's assisted living facility.
This stunning announcement came during an interview with the mayor and her chief operating officer, who say their priority now is making things right at Autumn Hills.
"We're focused on the future," Mayor Megan Barry stated emphatically.
Barry said she wants to move on from what's happened at Autumn Hills as soon as possible by replacing developer Mike Hampton and his business partner Sam Latham as managers of the assisted living facility.
"We're absolutely right now trying to find an operator who can come in and make sure that the folks who are out there, the residents, are safe and being taken care of," she explained.
Barry and her chief operating officer Rich Riebling admit they had no idea of the scope of the problems at Autumn Hills until our investigation first revealed the tens of thousands of dollars in unpaid bills, the lawsuits, tax liens, and the failure of managers to maintain unemployment and required liability insurance.
On top of that, residents and staff both told NewsChannel 5 Investigates that food and other items were often in short supply and that there was no heat on some days in the winter and no air conditioning in the summer.
"We were wrongfully perhaps under the impression that things were running okay," Riebling revealed.
"You guys brought up some really great concerns and we're seriously worried about that so we're moving in that process," the mayor added.
In fact, just after this interview, the city sent a letter to Hampton, notifying him that effective immediately, the lease agreement was terminated as was a lucrative land deal with Hampton to sell him a tract of 36 acres near Autumn Hills for $300,000.
Hampton, we discovered, then planned to turn around and sell part of that land back to the city's development agency, MDHA, for $250,000.
"In what world is that a good deal for taxpayers?" NewsChannel 5 Investigates asked Barry and Riebling.
They both immediately jumped to answer.
"Well, it hadn't happened," the mayor responded.
"It didn't happen," Riebling then said.
"It's not going to happen," added Mayor Barry.
Riebling said the city is now making arrangements to give that land directly to MDHA to build low-income senior housing and save the agency that $250,000.
They also promised that once new managers are in place, the city will do an audit to determine whether money is missing or was misspent.
Metro's agreement with Autumn Hills specifically said the city could come in and examine the books at any time, something the city never did. The mayor conceded mistakes were made.
"I think there are absolutely some lessons to learn here and clearly more oversight going forward will be required," Mayor Barry said.
Both Barry and Riebling also admitted that in hindsight Mike Hampton may not have been the best choice for the job.
As we discovered, when Metro hired Hampton to oversee Autumn Hills three years ago and agreed to let him develop the property, he was facing millions of dollars in tax liens, lawsuits by creditors, was defaulting on millions of dollars in tax credits while the state had shut down the nursing home he ran in Memphis.
"We were under the belief that it was a successful operation," Riebling told NewsChannel 5 Investigates.
When the Autumn Hills deal was signed, Riebling worked for Mayor Karl Dean and Megan Barry was on the Metro Council and the deal was part of a bigger plan to get Metro out of the nursing home business and save taxpayers money.
It included turning over the old Bordeaux hospital to private hands and building a skilled nursing facility near
Looking back, Mayor Barry said, "We thought at the time that this was the right thing to do. Of course, upon reflection there was a lot of moving parts here that didn't come to fruition like we'd wanted."
The mayor's decision to end the agreement with Hampton comes after members of the Metro Council urged her office to cut ties with him. The mayor says until they hire new managers though, the current managers will stay in place with close oversight from the city.