Minutes of the Blythe City Council Special Meeting
September 11, 2025
The September 11, 2025, Special Meeting of the Blythe City Council was called to order at 6:00pm in the Council Chambers by Mayor DeConinck. Also in attendance were Vice Mayor Rodriguez and Council Members Halby, Burton and Spraggins. Staff in attendance included:
Interim City Manager and City Clerk Crecelius, City Treasurer and Finance Director Christa Elms, Police Chief Dale, Chief Building Official Jason Brown, Fire Chief Ronnie Hasler and Public Works Director Elegores. City Attorney Roberto participated via teleconference.
The Pledge of Allegiance was led by Mayor DeConinck.
The Invocation was led by Council Member Burton.
Mayor DeConinck asked for a moment of silence in remembrance of 9/11 and our first responders.
SPECIAL MEETING ITEMS:
1. Posting of the Agenda.
The summary of agenda items were posted on the bulletin boards on the outside of the public entrance to the Council Chamber and near the inside entrance of the Council Chamber on Tuesday, September 9, 2025.
No public comment. Board Member Burton moved approval of the posting of the Agenda. The motion was seconded by Vice Mayor Rodriguez with a unanimous aye vote.
2. Municipal Service Review Prepared by LAFCO for the Palo Verde Healthcare District (PVHD). Interim City Manager Crecelius stated the City specifically requested that LAFCO conduct this MSR and prepare this report. We wrote a letter to them in May after hearing some concerning information from residents related to financial state of the Palo Verde Healthcare District. In June, the LAFCO Board unanimously voted to conduct this review. The MSR states that the overall goal to achieve with respect to PVHD and the Palo Verde Hospital is a fully restored and operational hospital with financial stability for the long-term. The ultimate goal is to provide relevant information that provides options and potential actions that could be considered to resolve the financial situation and administrative issues that have plagued PVHD for years, resulting in financial crisis.
It further notes that the Palo Verde Healthcare District is clearly unstable at this time, and the short-term outlook is unknown as to the ability to meet the goals of the 60-day Emergency Plan implemented by PVHD. The long-term outlook is questionable unless sufficient long-term cash flow requirements for sustainability and eventual restoration of the suspended services can be achieved. Current projections for the end of Fiscal Year 2025 are estimated to be a negative $7,355,161. From what I understand the Palo Verde Healthcare District was fully compliant with LAFCO and their data requests to conduct the MSR. After the analysis, LAFCO has made the following options and recommendations:
Option 1: PVHD continue with the implantation of the adopted recovery plan.
Option 2: Obtain State or County of Riverside funding to restore solvency and restore all suspended services and clear all outstanding debt.
Option 3: Obtain commercial loan funding guaranteed by the State or County of Riverside to restore solvency, restore suspended services and clear all outstanding debt.
Option 4: Lease the hospital to a public hospital or private hospital system.
Option 5: Form a Joint Powers Authority with the PVHD, the City of Blythe and County.
Option 6: City and County assume ownership and operation of the hospital and dissolve the PVHD.
Option 7: Consolidate PVHD with Desert Healthcare District and dissolve PVHD.
Option 8: Sell the hospital to a private provider and dissolve PVHD.
Option 9: File for Chapter 9 Bankruptcy proceedings.
After the options were provided the LAFCO Executive Officer made his own opinions on those options. His preferred recommendation is to combine Options 1 and 2 followed by Option 5 Formation of a JPA between the City of Blythe and County of Riverside which should be given strong consideration; Option 4 Lease the hospital to a private or public hospital provider; Option 3 to obtain commercial loan funding guaranteed by the state or County of Riverside to restore solvency and suspended services and clear outstanding debt. This option should only be considered if the preferred options are discarded.
Options 6, 7 and 8 essentially dissolve PVHD, and assign a successor agency or a commercial provider for restoring services and operating the hospital. Although these are options, they are not necessarily preferable and Option 9, Chapter 9 Bankruptcy. This option is the worst-case scenario and should only be considered if all else fails. There is a Public Hearing with the LAFCO Board on September 25, 2025 at 9am in Riverside. In conversation with some members of LAFCO, they are interested in hearing the City’s opinion on these options and potentially provide a recommendation for the record. The CEO of LAFCO will present this report to his Board, and they will decide on the options they feel the Hospital Board should undertake. Staff has a recommendation. After being part of the Ad Hoc Committee and attending several Healthcare District Board meetings, it’s apparent that there has been a breakdown in trust in the current Board and the Community. Continuing with the current board there is a lack of transparency and trust. It would be staff’s option that a new Board be sworn in and then we pursue Options 4 or 7, funding from the State and County and finding a private operator or consolidating with another hospital system to restore operations. What the community needs is healthcare.
We need to be able to admit patients. We need to be able to perform surgeries, to assist people in need instead of transporting them 100 miles across the desert in an ambulance or helicopter every time there is an emergency. That is the number one goal of the LAFCO report is to restore those services. It has been pretty unclear that after 60 days, what happens? What is District Board’s plan to get the hospital back to a fully functional facilty? The Vice Mayor has been much more involved than I have, and he can jump in if he has more information, but I am just not seeing what happens at the end of 60 days.
How do we get from here to back to where we were before the 60-day plan was implemented. Of all the options new funding is key to restoring the hospital. In the conversations that we’ve had, it’s really unclear if any new funding will flow from the County or State with the current Board in place. The best thing for this community is to have a new Board that can restore some faith and trust in the Community and with our elected officials to help assist with the funding requests that have already been made.
Tonight, we are looking for Council to determine the best option or combination of options to present to LAFCO and to appoint a spokesperson on behalf of the City to make these comments at the LAFCO meeting on September 25th.
Vice Mayor Rodriguez concurs with the City Manager’s assessment. We are in a hole. It will not be easy to come out of. It is going to take people with knowledge willing to make decisions that are not swayed by personal relationships at the facility. That is why I concur with her assessment that the current Board needs to be dissolved. This is not personal but look at the outcomes. Per the hospital, this downflow started in 2022.
Without CARES funding they would have been even more in a hole. They are burning almost $1 million a month. I don’t see how with the current Board and management style burning through almost a million dollars a month will be given the confidence to handle additional funds. With the same management any new funds would go to debt and then we will be right back to where we are now. That is why I would recommend the options listed. I hope the Desert Healthcare District will take it, but it is not guaranteed. They would need funding, and I am hopeful the County would fund it. I don’t see any funds coming from the State, not for a long time.
Mayor DeConinck asked about conversations with the Ad Hoc Committee.
Vice Mayor Rodriguez stated we have not met in the last few weeks. The meetings started to become repetitive and unfruitful. We were going in circles because nothing was presented outside of the 60 days. My feeling is that they were hoping for some State funding.
Mayor DeConinck asked what the County or Supervisor Perez was thinking in terms of the MSR.
Vice Mayor Rodriguez stated Councilman Halby and I had a 20-minute zoom meeting with Supervisor Perez last week. It’s my impression that its his perception that the Board needs to be replaced. The LAFCO report came out the day after we spoke, and we have not discussed it with him. He also met with the Hospital CEO and Board Members early on.
Interim City Manager Crecelius stated the County has several working groups who have met weekly and now bi-weekly to discuss the situation at the hospital and how we move forward. The Vice Mayor, our Lobbyist and I had a conversation with the County Executive Officer and staff about how we move this forward. The County is very invested in this and has been our partner. I think that if we present to them the best option we think to move forward, that they will follow our lead.
Councilman Burton says this sound easy but the new people that assume the role of the Board need to understand that their responsibility will be greater because there will be more to it and you can’t blame the other people, you have to assume the responsibility.
Sometimes people assume if you get rid of the old board and there is a new board you still have to make decisions and take responsibility.
Councilman Halby stated that is why we should pursue Desert Healthcare District. They are professionals, they know how to run hospitals. I serve on Council, but I would not try to take a crack at the hospital Board. I don’t know anything about hospitals or healthcare.
That is tough. I don’t know if there are many people in this town that are qualified for that. The five that are on it, they have been at one time, but they aren’t anymore. It’s time to go. It speaks volumes that none of the Board Members are here. Is it pretty bad that they are not here to defend themselves. That is all that I need to see. I don’t see their attorney here. That is despicable and embarrassing. Replace them.
Councilman Burton stated I was on the Hospital Boad and there are things that might take place if you dissolve the Board that are grandfathered in, the seismology of the building. If you shut down, then everything needs to be brought up to code so we need to be careful. It’s easy to say shut it down, get rid of them and do that, but we need to be strategic. I agree we are in a hole and in dire straits, but we need to be careful.
Interim City Manager Crecelius stated nobody is saying shutting down is any part of the equation. The hospital has to remain open.
Vice Mayor Rodriguez stated the recommendation is to consolidate. In speaking with the County and other partners they all know those doors cannot close.
Interim City Manager Crecelius stated there is an option of resigning. They could all individually resign from the Board and interim Board Members could be installed while we work through these options with the State, County and LAFCO.
Public comment. Leslie Jessop Watkins stated I have attended most District Board meetings since January of this year after being asked to attend. On page 37 of the LAFCO report, Option 9 Bankruptcy states clearly this would be a last resort and would not necessarily ever result in restoring the hospital to a fully functional facility.
Additionally, it could result in the hospital closing all together. This option is the worstcase option and should only be considered if all else fails. Unfortunately, that Board has made an attempt to pass a Resolution to do so. They are not being transparent about it.
Unfortunately, they did not hold those meetings legally. That is a legal issue and I believe option 9 should not be pursued. We don’t know as a community whether they have or have not filed. I agree with LAFCO and the Executive Director on that item. The funding for emergency vs. inpatient is vast. 911 and emergency is a wash. Inpatient is where you make your bread and butter. Without the function of the inpatient, it’s a moot point. It has to be a fully functional hospital for it to be financially viable. Both the LAFCO report and City Manager’s report relate to the County and State funding that has been requested. It’s not going to happen. If there is no trust in the Board or Management, who is going to give them money? If it was going to happen, it would have already. This community and our legislators have been on those meetings, and it is sad to watch how bad they have gone, and our elected officials are watching. I wouldn’t lend them a dollar.
We talked about a Blue-Ribbon Committee. They also have a hospital foundation. Has anyone in the last 10 years done anything to promote that? They had an opportunity to have a new x-ray machine brought in. They never returned the phone calls and guess what, we didn’t have an X-ray machine for over a week, and they were doing cat scans on everyone with high radiation. We have dire straits. They did apply for an extension on the distressed hospital loan. They did receive an extension. I have the documents for the loan and from the extension. My concern is that the documents from this year do not match what actually happened or what was asked for and received. If they are not correct, the State could chang their mind on the extension or forgiveness. I have the LAFCO Map. The sphere of influence for the Health Care District is from the river to Desert Center. The District line is west of Blythe at the prison. It does not go out to the Sphere of Influence. There is tax increment between the sphere and district lines. Where is the tax increment outside of the boundary of the distinction all the way to the sphere of influence? Why don’t we get property tax increment from that line? A lot of it has solar and there should be some assessment there. Why are we not begging for our district line to be re-drawn as part of this? The Board is a tough gig. There are a few people who are interested in serving on that board. One of them has previous experience and has a doctorate and works in this community. There are a few other obvious non-biased people who are willing to serve. Community trust needs to be restored and without that we are going nowhere.
Dr. Shalobei stated the Board should have held a special meeting to discuss the LAFCO report before the City had this meeting. I think LAFCO should have spoken with the Chief of Staff and I have not spoken with them. The hospital should have spoken with me before they closed surgery. They have not consulted me on any issues related to medical staff. Why? Because they don’t want anyone to know what’s going on because they know they screwed up. I have questioned this Board for the last 3-4 years.
Especially since 2022 when they built a modular clinic for a million dollars, at that time.
The County wanted to sell their building for a million dollars. They have no answer.
They talk and talk with no action That project became $2.5 million. They don’t understand the business model. Board Members only need ethics and conscience. If you did nothing wrong and the hospital is about to close, just resign. They are clueless. This is the City Council and has nothing to do with the hospital. This hospital will not survive until someone there understands the business model. The hospital has one employee, the CEO but the right hand doesn’t talk to the left. They cancelled a physician contract even though I told them not to. Their personal agenda gets in the way of what’s best for the hospital and community. I think Option 7 is the only option.
Dee Coats stated I agree with the Interim City Manager. What you presented are excellent options. I agree the board needs to go in order to get any money to restore solvency. It’s not a personality issue; it’s a financial issue and a life-threatening issue. If we don’t have a hospital, we are a dead community. We have enough problems without losing our hospital.
Mayor DeConinck asked if the Desert Health Care District was interested in taking over PVHD.
Vice Mayor Rodriguez stated in the one conversation I was part of it was said that they would basically need the money to do it. They did not seem excited about it.
Vice Mayor Rodriguez moved approval of staff’s recommendation of Options 2, 4 and 7.
The motion was seconded by Council Member Burton with a unanimous aye vote.
Council Member nominated Vice Mayor Rodriguez to be the City’s spokesperson. The motion was seconded by Council Member Burton with a unanimous aye vote.
ADJOURN: The City Council meeting was adjourned at 7:08pm. ________________________________
Joseph DeConinck, Mayor
ATTEST:
________________________
Mallory Crecelius , City Clerk