City Will Buy Former Lovelace Hospital For “Gateway Center” For Another $2 Million For Total $15 Million; What Timmy Wants, Mayor Keller Gets

Since being sworn in on December 1, 2017, Mayor Tim Keller made it known that building a homeless shelter was one of his top priorities. City Hall had deemed that a 24-hour, 7 day a week temporarily shelter for the homeless as critical toward reducing the number of homeless in the city. The city owned shelter was projected to assist an estimated 300 homeless residents and connect them to other services intended to help secure permanent housing. The new facility would have served all populations of men, women, and families. Further, the city wanted to provide a place anyone could go regardless of gender, religious affiliation, sobriety, addictions, psychotic condition or other factors.

The city facility was to have on-site case managers that would guide residents toward counseling, addiction treatment, housing vouchers and other available resources. According city officials, the new homeless shelter would replace the existing West Side Emergency Housing Center, the former jail on the far West Side. The west side facility is unsustainable costing over $1 million in transportation costs a year for the homeless. The goal was for the new homeless shelter to provide first responders an alternative destination for the people they encounter known as the “down-and-out” calls.

On November 5, voters approved a general obligation bond package of $128 million which included $14 million for the city operated 24-7 homeless shelter. The actual cost was to be $32 million. The City asked the 2020 New Mexico Legislature for an additional $14 million to complete phase two of the project, but the funding request failed.

Notwithstanding Mayor Keller’s desire for a city run shelter, and the bond approval, there were many critics of the proposal. The critics included downtown business organizations such as the Greater Albuquerque Business Association (GABA) and neighborhood associations that mounted strong opposition. Critics argued against mixing populations and argued that a large facility would unduly burden any one neighborhood or business area of the city. Bernalillo County officials, homeless service providers and residents of neighborhoods surrounding potential locations seriously questioned the city’s efforts for a one centralized shelter.

KELLER ABANDONS SINGLE GATEWAY CENTER CONCEPT

On Wednesday, May 7, 2020, Mayor Tim Keller conducted one of his daily briefings on the City’s response to the Corona Virus. However, he dedicated most of the briefing to report on the “Gateway Center.” Participating in the briefing were Chief Operating Officer (COO) Lawrence Rael and City Council President Pat Davis. The FACEBOOK video link to the press briefing is here:

https://www.facebook.com/MayorKeller/videos/290814465247439/UzpfSTEwNTQ4MTY4OTY6MTAyMjAwNDA5NDYxMDgwMTQ/

In a surprise announcement, Keller said that the city was abandoning the development concept of a single, 300-bed homeless shelter. He announced the city will be proceeding with a “multi-site approach” to the city’s homelessness crisis. Mayor Tim Keller went so far as to state that the 300 bed Gateway Center was “off the table”.

Keller said the corona virus crisis has highlighted the need for an alternative to the city’s existing shelter, which is the former jail 20 miles from downtown and he said:

“The coronavirus has also shown us how important this is. … The amount of funding and logistics we have to deal with going back and forth to the West Side … is extremely hard.”

MULTI-SITE APPROACH

When the city abandoned plans to build one large homeless shelter, city officials said the new multi-site approach could mean a series of “smaller facilities” throughout the community. Ostensibly, there would be no single resource hub in one large facility as was originally proposed with the 300 bed Gateway Center.

City Family and Community Services Director Carol Pierce offered insight into what the city means when it refers to small shelters and had this to say:

“We’re often talking 100 to 150 beds of emergency shelter that could be defined as a smaller shelter.”

CITY MAKES OFFER TO BUY LOVELACE HOSPITAL COMPLEX ON GIBSON

In an attempt to buy the first Gateway location, the city made an offer to buy the former Lovelace hospital on Gibson Boulevard in Southeast Albuquerque for $13 million.

The Loveless facility is a 529,000-square-foot building and upwards of 50% of it is said to be vacant. The facility has a 201 bed capacity, but remodeling could likely increase capacity significantly. According to one news report, an estimated $10 million in upgrades in the Lovelace Hospital Complex, including remodeling for specific tenants, improving common areas and the parking lot and installing a 540-ton cooling unit out back were made by investor owners. Parts of the building date back to 1950 and what was then known as the Lovelace Clinic, and as a result the need for any asbestos remediation is subject to speculation and has not been reported on by the news media.

https://www.abqjournal.com/774956/medical-center-at-old-lovelace-hospital-might-expand-to-other-uses.html

According to one report and analysis released by the city, the cost to purchase the Lovelace Hospital Complex would be $14 million in acquisition and renovation costs. It was in 2007 Lovelace Medical Center closed down. It was later purchased by local private investors.

On Thursday, December 17, 2020 Mayor Tim Keller did not give a specific answer when asked how many emergency shelter beds the city may include at the Lovelace facility if purchased. Keller called the planning “fluid” since the city has not yet acquired the property. Other city officials said the Lovelace site may have other uses beyond shelter beds, including behavioral health services and medical care.

A link to news source material quoted is here:

https://www.abqjournal.com/1527950/city-official-smaller-shelter-means-100-150-beds.html

DONATION TO CHARITABLE FOUNDATION

The investors who purchased the former Lovelace Hospital on Gibson were Jimmy Daskalos and Nick Kapnison. Nick Kapnison is one of the owners of “Nick and Jimmy’s” Restaurant, Mikinos Creek Restaurant and Papa Fillipes. Mr. Nick Kapnison is a highly respected businessman and community activist.

The Albuquerque Journal reported that Nick Kapnison donated $3,500 to Mayor Keller’s Charitable Foundation. The Charitable Foundation has raised $250,000 from private donors for city initiatives.

The Mayor’s Charitable Foundation has given the City $20,000 to provide housing vouchers for the homeless.

The link to the Journal report on the donations is here:

https://www.abqjournal.com/1421506/familiar-businesses-back-abq-foundation.html

LAWSUIT FILED AND SETTLED

The city’s attempted purchase of the Lovelace property was in serious jeopardy. The facility and property became embroiled in a highly contested lawsuit between the two former business partners who owned the property, Nick Kapnison and Jimmy Daskalos.

Daskalos and his wife sued Kapnison and the city last October to try and stop the sale. It was alleged that Kapnison violated the parties’ previous agreement, was selling the property over their objections, and that he was accepting too low a price. The lawsuit contended that a 2020 appraisal had valued the property at $18.5 million.

According to a news report, the city entered into a $13 million purchase agreement for the property with Nick Kapnison. Jimmy Daskalos sued both the City and Kapnison to stop the purchase. Daskalos and his wife alleged breach of contract. They claimed Kapnison sold the Gibson Medical Center against their wishes, that he violated the terms of a “power of attorney” given to him and offered the property at less than a “commercially reasonable” price in violation of his fiduciary responsibilities. Mr. Kapnison denied the accusations.

Court pleading file reveal the Daskaloses still owed Kapnison $4.5 million as part of a 2020 buyout agreement terminating the Kapnison and Daskalos long time business relationship. That debt was secured by the Gibson Medical Center and other property.

The city filed a counterclaim against Daskalos. The denied the Daskalos allegations, contending in its response and counterclaim that Kapnison had the legal authority to negotiate the sale in that he had a power of attorney. The city also disputes the claim that the purchase price is far below the property’s value. Soon after the city filed a counterclaim, the city entered in to settlement negotiations.

https://www.abqjournal.com/1534612/citys-planned-shelter-site-embroiled-in-lawsuit.html

On February 18, 2021 it was reported that the Keller Administration agreed to pay another $2 million to buy the former Lovelace hospital for its long-awaited Gateway Center. The settlement raised the total purchase price to $15 million and resolved the city’s involvement with the litigation. over the property’s ownership.

The link to the news story reporting on the settlement is here:

https://www.abqjournal.com/2360797/city-settles-lawsuit-over-old-lovelace-hospital.html

KELLER’S CHARTIABLE FOUNDATION

On January 7, 2019, Mayor Tim Keller announced the creation of the One Albuquerque Foundation. It’s a foundation formed by the city to collect donations from the general public to support city initiatives and projects. According to the city’s website page:

“… the endowment Fund raises funds in support of and to supplement measurable city priorities, including the housing voucher program for people experiencing homelessness, recruiting and retaining public safety officers, expanding opportunities for young people in Albuquerque, and equipping our workforce with the skills they need to succeed. Additional funding for these priorities will accelerate progress and help scale significant investments the City is already making go much farther, much faster.”

On February 7, 2020 the Albuquerque Journal reported that the Albuquerque One Foundation has raised nearly $250,000. Records provided by the city pursuant to a request for public records show most of the money is not coming from individual citizens but rather a cross section of well-known businesses and individuals. The donations that make up the $250,000 are not small donations from people but are in the thousands made by a few.

https://www.abqjournal.com/1421506/familiar-businesses-back-abq-foundation.html

All told, 35 entities and individuals donated $248,250 to the fund. A breakdown of the large donations included Nick Kapnison, owner of Nick and Jimmy’s Restaurant, Mikinos Creek Restaurant and El Patron Mexican Restaurant for a donation of $3,350. Restaurants must maintain a license to do business with the city and are subject to the zoning and code enforcement regulations including health code inspections.

Mayoral spokeswoman Jessie Damazyn at the time confirmed that many contributions made to the One Albuquerque Foundation came in response to face-to-face requests made by Mayor Tim Keller himself to meet with donors. Damazyn did not say exactly how many of the existing donors Keller met with personally to solicit contributions, but said that he had talked with “nearly all” of those on the list of 35 as well as many others “in contexts from coffees to community events to speaking engagements about how they can play a role from volunteering to donating.”

A link to a related blog article is here:

https://www.petedinelli.com/2020/02/22/mayor-keller-needs-to-knock-it-off-fundraising-for-his-charitable-foundation-abq-journral-weighs-in-inspector-general-needs-to-review/

COMMENTARY AND ANALYSIS

The size and scope of the shelter component at the Lovelace facility is likely to be a major source of contention with area neighborhood residents objecting to its use for the homeless. The city planning department reports the property’s zoning does not impose a bed cap, which no doubt is problematic for the neighborhood. The City could decide to unilaterally fill the facility with the original 300 beds as proposed for the original 24 – 7 homeless shelter facility.

The zoning for the Gibson Lovelace facility does allow an overnight shelter as a “conditional use,” something the city could, and would, consider pursuing if necessary. “Conditional use” permits often generate controversy and oppositions and require a public hearing. Conditional uses are granted only if there are no significant adverse impacts to surrounding areas.

If the purchase of the Lovelace facility goes through as is anticipated now that the civil case is settled, the Keller Administration will likely unilaterally fill the facility with the original 300 beds. It that happens, it will be viewed justifiably as nothing more than a “baite and switch” scheme where Mayor Tim Keller first wants a single facility, changes his mind for multiple smaller facilities only to turn around to change his mind again.

On Thursday, December 17, when Mayor Tim Keller did not give a specific answer when asked how many emergency shelter beds the city may include at the Lovelace facility if purchased Keller called the planning “fluid”. It’s more likely than not Keller knew what his end game and goal was all along, but did not disclose it to the public. This coming from a Mayor who has promised transparency and ethics in government.

WHAT DID KELLER DISCUSS AND WHEN DID HE DISCUSS LOVELACE PURCHASE?

The propriety of Mayor Tim Keller scheduling meetings to solicit private denotations for his charitable foundation from those who do business with the city or who interact with city departments and who want to talk with him is so very, very wrong on so many levels with respect to ethical conduct and the appearance of impropriety. The solicitations by Mayor Keller during city business smacks of “pay to play” at worst and at best gives the appearance of impropriety and the exertion of political influence to compel donations from those who do business with the City of Albuquerque, either by contract or being regulated by city departments.

Large donations made in the political world more likely than not come with the expectations of at least access to the elected official or a candidate and even commitments to be performed. What is very disturbing is that Keller had his office arranged the meetings, had the private conversations, but nothing was disclosed as to what was discussed, how the donation amounts were determined nor what commitments, if any were made, by Keller to the donors or the donors to Keller. No one knows for certain what private conversations nor commitments Keller had regarding the Lovelace hospital purchase.

It is a pathetic practice for any government entity and its elected Mayor to solicit donations from the general public to carry out its duties and responsibilities to the public. In the eyes of many city hall insiders, observers and a few city hall confidential sources, Keller engaged in unethical conduct with his Charitable Foundation, but his top Administration Officials have gone along with it without any objection because he is “the Mayor” and always gets what he wants very much like a spoiled child.

With the purchase of Lovelace Hospital for his Gateway Center, what Timmy wants, Mayor Keller gets.

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About

Pete Dinelli was born and raised in Albuquerque, New Mexico. He is of Italian and Hispanic descent. He is a 1970 graduate of Del Norte High School, a 1974 graduate of Eastern New Mexico University with a Bachelor's Degree in Business Administration and a 1977 graduate of St. Mary's School of Law, San Antonio, Texas. Pete has a 40 year history of community involvement and service as an elected and appointed official and as a practicing attorney in Albuquerque. Pete and his wife Betty Case Dinelli have been married since 1984 and they have two adult sons, Mark, who is an attorney and George, who is an Emergency Medical Technician (EMT). Pete has been a licensed New Mexico attorney since 1978. Pete has over 27 years of municipal and state government service. Pete’s service to Albuquerque has been extensive. He has been an elected Albuquerque City Councilor, serving as Vice President. He has served as a Worker’s Compensation Judge with Statewide jurisdiction. Pete has been a prosecutor for 15 years and has served as a Bernalillo County Chief Deputy District Attorney, as an Assistant Attorney General and Assistant District Attorney and as a Deputy City Attorney. For eight years, Pete was employed with the City of Albuquerque both as a Deputy City Attorney and Chief Public Safety Officer overseeing the city departments of police, fire, 911 emergency call center and the emergency operations center. While with the City of Albuquerque Legal Department, Pete served as Director of the Safe City Strike Force and Interim Director of the 911 Emergency Operations Center. Pete’s community involvement includes being a past President of the Albuquerque Kiwanis Club, past President of the Our Lady of Fatima School Board, and Board of Directors of the Albuquerque Museum Foundation.