- The Washington Times - Monday, July 10, 2000

District officials are hunting for a way out of another financial debacle, and they need to find it now. Otherwise John Fairman may collect on a very sweet deal at the expense of D.C. taxpayers.

Mr. Fairman is the former head of D.C. General Hospital. Now that he's been canned, he wants to take advantage of a provision in his contract, renewed in April 1999, that allows him to cash out of the job for $1 million plus an office, plus a secretary, plus communications equipment. The provision is inexplicable. "This is insane," as Mayor Williams' policy chief, Gregory M. McCarthy, put it. "The details of this package are absolutely outrageous. If anything, Fairman should pay us $1 million for all that's ensued negatively at the (Public Benefit Corp.) in the past few years.

Mr. McCarthy is correct on all accounts. So far this year, the D.C. Health and Hospitals Public Benefit Corp., or PBC, which operates D.C. General, has exceeded its budget by more than $40 million, and officials fear the hospital's cumulative three-year deficit will reach $90 million by Sept. 30. There is no financial help coming from Congress, which has said pointedly that the city should not not expect supplement federal funds.

Not only is the overspending a violation of the federal anti-deficiency act, which provides punishment of up to two years in prison and a $5,000 fine for D.C. and federal employees who knowingly overspend their budgets. But D.C. officials now fear they may have to close the hospital. Indigent residents, who depend on D.C. General for emergency care and outpatient services as well, would suffer accordingly unless the city's for-profit and teaching hospitals could somehow fill the void. That doesn't seem likely.

D.C. officials might have seen this coming. Mr. Fairman came here following his involuntary departure from the City of Denver, which sent him packing in 1990 amid allegations of fiscal improprieties while running that city's hospital. He soon landed in the nation's capital, took charge of D.C. General Hospital and, last year, won himself the heftiest salary on the District's payroll, $275,000.

Following the disclosure of the hospital's financial problems, the District's chief financial officer ordered Mr. Fairman to "close immediately" all PBC bank accounts, submit a full accounting of all deposits, expenditures and transfers, and turn all funds over to the D.C. treasurer. The mayor took other actions to safeguard the public trust by replacing four members of the PBC board, and the newly constituted board replaced Mr. Fairman on June 30.

Now, after being ousted for failing to fulfill his legal and fiduciary obligations, Mr. Fairman thinks taxpayers are obligated to fork over $1 million. Mr. Fairman's attorney, the honorable Frederick D. Cooke Jr., says he is prepared to negotiate. How generous. Let the bargaining begin at zero. If the city winds up owing more, the officials who agreed to give Mr. Fairman this golden handshake have as much explaining to do as Mr. Fairman.

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