✨ Governance of CCRC/LifePlan Communit

In 2008, we moved into an Erickson community in Illinois. Erickson filed for bankruptcy in Oct. of 2009. They certainly kept their financial troubles a secret from residents. One morning, we all got a letter slipped under our doors stating they had filed for bankruptcy. Needless to say, it was a huge shock. Our community was not picked up by the company that bought most of the other Erickson communities, and our community was auctioned off in 2010. The court required a resident committee be appointed to represent our interests.

Fortunately, the winner of the auction was a reputable for-profit company who hired a responsible management company to run the day-to-day operations. The transition to new ownership and management was amazingly smooth considering the situation. We were very lucky. The current owners have invested a lot of money in upgrading and improving the community, and we are still owned and managed by those same companies. The current owners and administrators are very transparent about the financial health of the community, and we are glad to still be living here.

We are living through a failure now. The previous administration was extremely secretive and we found out about it when there was an announcement that they were bringing in a consulting firm. Later, it became known that the community was more than $60M in debt and that it was the debt holder (bank) that brought in the consulting firm. The consulting firm took over, fired or forced out the previous administration and a number of workers and installed their own people. They are in the process of restructuring us so that our CCRC will be an attractive acquisition to another CCRC. The goal was to avoid bankruptcy. Initially, the consulting firm was very open but over the last 2-3 months, they have also become secretive and it’s difficult to know what is going on.

What were the clues? ProPublica has a list of nonprofits (https://projects.propublica.org/nonprofits/organizations/142007220). If you know the name of your parent organization, you can see their IRS 990 form. Ours has been losing money since 2015 which was documented in 990 filings in ProPublica. Other clues: lack of preventive maintenance, hard to get repairs made, secrecy on the part of the administration, no resident representation on the board, empty units, run-down look.

Hope this helps. Good luck.  

I haven't, but great question. Following.

Has anyone lived through a CCRC failure? I have a number of questions about that experience: 1) Were there "signposts" along the way that suggested the community was heading towards failure? 2) At what point did residents become aware that there was a problem? 3) HOW did they become aware that there was a problem? 4) Was there any effort by the Administration to involve residents in finding a solution?

Thank you and Happy New Year!