Readers, we just caught a new post by the folks over at Boston Catholic Insider regarding the Caritas Christi transaction that looks like it’s a worthwhile read. It’s their Top 10 questions about the Caritas/Cerberus deal. All merit a read, but if Question 7 in particular is true, it’s baffling to us why that would be part of the sale agreement:
If Cerberus fails to make the promised capital investments over the next four years, why does the Massachusetts Attorney General get to choose where that shortfall is donated?
Section 8.8b says, “To the extent that, by such fourth anniversary, Purchaser has failed to cause the Health Care System to spend or commit to spend no less than $400 million as provided in Section 8.8(a), Purchaser shall cause the Health Care System to contribute such shortfall to a charitable foundation designated by the Massachusetts Attorney General.” In other words, if Cerberus doesn’t spend $200 million on improvements they committed to make to the Caritas Catholic healthcare system as part of the deal, Martha Coakley can decide to give that $200 million to the National Rifle Association or the National Organization of Women, or whomever the heck she pleases? Who died and left Martha Coakley in that position of responsibility? Why don’t those committed funds go back to the Archdiocese of Boston? If Cerberus drops the Catholic identity, $25 million goes to a charity of the Archdiocese’s choice, but if they reneg on a couple hundred million of investment in the system, the Attorney General decides where that shortfall goes? This makes no sense whatsoever.
Can Fr. Erikson or anyone from Archdiocese explain this one to us?