In The News

Settlement funds eyed by agency

July 30, 2006

Randy Smith: Offered millions to help restore a hospital in Calexico.

By Eric Galvin, Staff Writer

Calexico – An offer to provide millions of dollars to help restore a Calexico hospital still stands, according to former Calexico Hospital Management Group administrator Randy Smith,

Less than two months ago, Smith, the former administrator of the long-defunct Calexico Hospital, and his former silent partner Jay Ash were awarded a $12 million settlement in a suit against the state Department of Health Services.

At the time Smith offered to provide the majority of the money to the city if it was interested in re-establishing a hospital.

On Friday, a Calexico Neighborhood House official confirmed interest in Smith's offer.

“We asked him if he would be willing to help us and he said yes,” Neighborhood House program coordinator Cynthia Alba said. “We told him we would send him information and he said he would look at it.”

Smith said Neighborhood House was the only agency in Calexico to inquire about the offer.

He said he had not yet received any calls from the Heffernan Memorial Hospital District or anyone representing the city of Calexico.

He said he was not surprised.

“No not at all. I'm used to the politics,” said Smith, now a business consultant in San Diego.

Calexico City Councilman David Ouzan said the council was aware of the offer, but “has not really looked into it.”

Smith and Ash decided to sue the state when inspectors, they said, dragged their feet on certifying the hospital to reimburse for Medi-Cal and Medicare billings. Because it took so long, Ash and Smith ran out of money wile trying to keep the hospital open and employees paid through a combination of city loans and their own personal assets.

A jury in Imperial county Superior Court agreed with Smith and Ash's contention and awarded them one of the largest settlements in Imperial County court history.

The city Redevelopment Agency owns the Calexico hospital building and the Heffernan board is the governing body of hospital operations in Calexico.

While Smith has been away from hospital administration since 1998, the same year the Calexico hospital closed, he said he still has an interest in Calexico having its own hospital or “medical community.”

“I've never seen a place that needed health care more than Calexico,” Smith said. “The community still deserves what it needs, regardless of all political interference.”

Alba said Neighborhood House, which works in conjunction with the General Board of Global Ministries of the United Methodist Church to help low-income families with various services, has been working with the community to help establish a hospital in Calexico.

And while the contact has been made by Neighborhood House, there is no guarantee Smith and Ash will receive the money awarded.

Their lawyer, Dan Lawton, confirmed the state appealed the verdict. The appeal will be handled on an expedited basis, so a final decision will be made by year's end.

On Wednesday, an El Centro judge awarded Smith and Ash $2.28 million in attorney's fees and costs for the case.

Lawton said he expected that decision to be appealed, too.

“We expect them to continue fighting until they run out of appeals,” Lawton said.

Lawton said he doesn't believe the appeals to be standard protocol and conceded he met with state attorneys previously about discussing a settlement.

He said they “disdained every opportunity.” He also said while offering to talk about a settlement, a condition on his part would be that there would be no further settlement talks should an appeal be made on the state's end.

“We're talking about good sense and fiscal responsibilities,” Lawton said. “They act like they're completely disinterested in that.”

Staff Writer Eric Galvan can be reached at 337-3441 or at

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