As the saga of the Mt. Diablo Health Care District draws to a close, one final detail deserves clarity.
While former Director Ron Leone, now a member of the Concord City Council, agreed to a buyout of his lifetime health care benefits from the Mt. Diablo district, his portrayal of the deal as a magnanimous gesture is misleading. This is a cash payment wrapped in the cloak of a charitable contribution.
Control of property tax revenues for the district, which hasn't run a hospital since 1996, has now been transferred to the city of Concord. For months, the transfer was hung up over what to do about the approximately $550,000 liability for health insurance for Leone, 62, and his wife, who is 59.
Leone claimed the benefit under a ridiculous perk for directors who served at least 12 years. The city understandably didn't want the liability when it took over the district. At the last minute, Leone worked out a deal for a $150,000 cash payment instead.
To gussy it up, the district paid the money to the American Cancer Society, which in turn provided an annuity for the Leones. The cancer society enters into annuity deals with the expectation that they are likely to eventually receive some leftover money.
The spin from Leone was that the annuity would be available for him and his wife to draw upon only if they found themselves without insurance.
Unused funds would revert to the American Cancer Society to help local cancer victims, the mayor told reporter Lisa Vorderbrueggen at one point. "I feel very comfortable that the vast majority of the money, if not all of it, will go to cancer patients in Concord."
That's unlikely. At our request, Leone provided a copy of the annuity agreement. We appreciate that he cooperated. And we recognize that the cancer society could, and should, make some money off this deal.
But it turns out that Leone and his wife will receive fixed payments, starting at $6,600 annually in two years. If they wait longer to start drawing payments, the annual amount would increase. There's no restriction on the purpose for which the Leones can draw the money.
While it's better than the original $556,000 liability, let's recognize this for what it is: Lifetime payments to Leone for service on a small health district board. It's still wrong.
To view the annuity agreement between the Leones and the American Cancer Society, go to www.contracostatimes.com/opinion and click on this editorial.