This article is a follow up to a comment made by Gov. Granholm during the first debate with Dick DeVos. The Michigan Democrats also sent out a media release that charged DeVos with not really caring about Senior Citizens. Mark Brewer, the Michigan democratic Party Chair is cited first in the story with a response by DeVos spokesperson John Truscott. The article also cites the daughter of a woman who was neglected at an assisted living facility operated by the company DeVos is a major shareholder in. The Company also is cited in response to the Democrats using this woman “as a political pawn.” DeVos himself is cited where he brings up that Granholm and the state have similar investments, which is followed by Granholm campaign spokesperson Chris DeWitt. Do you think there is any bias in this story? What did you learn about the candidates that was verified by the reporter?
LANSING — State Democrats on Tuesday stepped up their charge — first leveled by Gov. Jennifer Granholm in Monday’s gubernatorial debate — that Republican challenger Dick DeVos and his family controlled an assisted-living company cited for patient abuse and mistreatment.
A $173 million investment by DeVos and others in May 2000 bought control of Alterra Healthcare Corp., Democrats asserted, and responsibility for the company’s treatment of residents.
DeVos responded then and reiterated Tuesday he and his wife, Betsy, were passive investors in Alterra, holding less than 1 percent of the company’s common stock. The investment ended when Alterra began bankruptcy proceedings in 2003, he said.
DeVos added he became aware “just recently” of the “challenges and allegations” regarding patient care at Alterra from 2000 through 2002.
Common-stock ownership aside, DeVos, members of his family and family associates controlled 91 percent of a separate May 2000 issue of debt instruments designed to keep the company afloat, said Mark Brewer, Michigan Democratic Party chairman.
Citing federal Securities and Exchange Commission (SEC) documents, Brewer said the DeVoses and investors close to them appointed four of the corporation’s nine directors, effectively giving the DeVos family control over Alterra’s board of directors and responsibility of facility operations.
Even though they were in the minority, those four directors had veto powers over board decisions because the votes of at least two of THEM were required for any motions to pass.
“For him to deny that he had control here was wrong,” Brewer said of Dick DeVos.
DeVos spokesman John Truscott responded that, while the DeVos family and associates invested $173 million in Alterra in May 2000, company bylaw provisions filed with federal regulators giving the DeVos family and its associates effective control over Alterra’s board were never exercised.
Alterra’s chairman of the board when the company was undergoing financial struggles was Jerry Tubergen, president and chief executive of RDV Corp., the Grand Rapids company that makes investments and handles taxes for DeVos, his siblings and his parents, Helen and Richard DeVos Sr., a billionaire who co-founded Amway Corp.
Tubergen was a non-executive board chairman with no involvement in daily operations of Alterra, said Ginny Seyferth, a spokeswoman for Tubergen.
DeVos had no involvement, either, Truscott said.
Alterra, which specializes in homes for residents suffering from Alzheimer’s disease and other forms of dementia, was the subject of other complaints about its homes in Ohio, Florida, New York state, Colorado and Minnesota from 2000 through 2002.
On Monday, Granholm challenged DeVos to clarify his ownership interest in Alterra and respond to the record of its residential care facility in New Philadelphia, Ohio. In 2002, according to published reports, state investigators found five female residents were sexually and physically assaulted by a male resident over a period of months.
Michigan Democrats brought Ohio resident Kathy Recco to Lansing on Tuesday. Her mother was a resident of the Ohio facility at the time, but was forced to move for fear of being assaulted, she said. She charged that Alterra knew the abuse was going on, but failed to care for vulnerable residents.
“These families suffer to this day knowing they entrusted their loved ones to a facility that was not what it promised to be,” Recco said.
Alterra settled the Ohio case by paying a $10,000 fine and undergoing six months of monitoring by state regulators.
Alterra operates 27 assisted living centers in Michigan caring for more than 700 senior residents.
In a statement released Tuesday, Alterra said: “We are surprised and disappointed to find our employees, our residents and our families used as a political pawn in Michigan’s gubernatorial campaign. The governor unfairly characterized the integrity of our company and our (1,000 Michigan) employees.”
DeVos’ investment was an attempt to save a struggling company, Truscott said..
Later Tuesday, DeVos tried to tie Democratic Gov. Jennifer Granholm to investments made by the state of Michigan in two companies he said have engaged in abuse and neglect of patients.
“The governor is accusing me when, in fact, the same activities could be said of the governor under her direct responsibility and control,” he said. “This is a double standard. It’s another cynical attempt to distort me and distort my record in order to advance a political career.”
Granholm campaign spokesman Chris De Witt said the governor had no say in the state’s decision to invest in Community Health Services and Health Management Associates.
“The law precludes the governor from making investment decisions. … DeVos made a personal decision to take control of Alterra. That is a huge difference,” De Witt said. “All of Governor Granholm’s investments are included in her tax return.”
Most state investments involve retirement systems covering state workers and public school employees and are overseen by the state treasurer and the Bureau of Investments.
The state holds shares in Community Health Services through the S&P 400 Midcap Stock Index and in Health Management Associates through the S&P 500 Large Cap Index Fund, said Treasury spokesman Terry Stanton. He confirmed that governors don’t get a say in state investments.
“The state treasurer is the sole fiduciary,” he said.
According to the DeVos campaign, among the problems found at the facilities were dozens of instances in which a male patient sexually abused female patients and problems with doctors inadequately caring for patients, leading to deaths that could have been prevented.
“In the end, the governor is going to be very, very upset that she opened up this can of worms,” said DeVos spokesman Truscott.