The Real Deal New York

The plot thickens: Health care lobbyist with ties to Cuomo involved in Rivington House deal

Jeffrey Sachs was an usher at the governor's wedding
August 30, 2016 08:44AM

Jeffrey Sachs

Jeffrey Sachs

As if the sale of Rivington House weren’t controversial enough, it turns out that an influential health care lobbyist with ties to Gov. Andrew Cuomo played a key role in obtaining state approvals that paved the way for the deal.

Jeffrey Sachs — an usher at Cuomo’s wedding — served as a consultant to VillageCare, the nonprofit that sold the Lower East Side nursing home to Joel Landau and Solomon Rubin’s Allure Group in 2015.

Sachs, whose outsized influence on health policy has been questioned previously, helped VillageCare convert the property from an AIDS treatment facility to a general nursing home that would be run by Allure, Politico reported. Instead, Allure sold the site to developer Slate Property Group and its partners, pocketing $72 million in profits.

“I am talking to Governor’s office. Jeff should too,” Kevin Finnegan, the former political director for health care union 1199 SEIU, wrote in a 2014 text message to Landau, according to documents obtained by Politico.

Officially, Sachs froze “all contact on behalf of clients with state officials” in 2011 in response to questions raised by the New York Times. A spokesman for Sachs said VillageCare had been a longtime client of Sachs Policy Group, and that Sachs never worked for Allure. “Once VillageCare sold the property – with the development restriction still upon it — SPG’s involvement with the issue ended,” the spokesman said.

A spokesman for Cuomo denied that the governor and Sachs discussed the issue.

But according to Politico, behind-the-scenes negotiations were still taking place. In September 2014, Finnegan told Laundau through another text message that the state had blessed the deal. “State says you can go ahead and purchase Rivington as a nursing home,” he wrote. One catch was a state-required “Certificate of Need,” a review process for health facilities. But that process, too, was expedited and the state’s Health Department ultimately said a CON was not needed despite the sale.

Allure bought Rivington House for $28 million in 2015, and shuttered the nursing home in December of that year. Landau subsequently sold the facility for $116 million to Slate.

Those moves left Allure’s former allies with a sour taste in their mouths. According to Politico, the state’s Health Department said it was misled by Allure. And an 1199 spokesman said Allure only placed 38 out of 200 workers when Rivington House closed, despite promises to find new jobs for nearly all of the employees.

The city’s Department of Investigations released a damning report that found City Hall was aware of the negotiations leading up to the sale. [Politico]E.B. Solomont