Group asks for deal to be thrown out

The Lewis-Clark Valley Healthcare Foundation Board of Community Advisors says an August deal between Idaho Attorney General Lawrence Wasden and Idaho Trust Bank shuts out local input in deciding where grant money can be spent in the region.

The Board of Community Advisors is asking a judge to invalidate the August agreement between Wasden and the trustee Idaho Trust Bank.

“The agreement changed the trust from one that actively participates in identification and development activities that promote health, wellness and prevent disease to one that responds only to grants brought to it by the trustee,” Board of Community Advisors President John Rusche said. “They are really removing a large community voice in how this asset improves the health and wellness and disease prevention within the region.”

In August, Wasden and Idaho Trust Bank came to a non-judicial binding agreement that restated what the Board of Community Advisors was supposed to do within the trust’s grant process. The agreement said the board was limited to grant application review and making recommendations to the trustee about who should receive the grants.

“The Attorney General did not envision the Foundation directly engaging or participating in charitable activities other than the administration of a standard grant process involving soliciting and reviewing grant applications and approving and making grants to eligible organizations,” the August agreement said. “The Attorney General did not intend for the BCA to have any other duties or responsibilities; instead the intent was for the BCA’s limited, but important, grant review and grant recommendation workload to be commensurate with the BCA’s volunteer status.”

The board says the agreement in August would not allow it to participate in Innovia Foundation’s Risk and Opportunity Assessment in 2018 and 2019 and it would not be able to participate in the COVID Response Pool like it did last spring. The COVID Response Pool distributed $450,000 to regional not-for-profits.

Under the new agreement, the board “can’t go out and make agreements, cooperate; it can only make grants,” Rusche said. “It removed the significant amount of input from the board and placed absolute discretion on the part of the trustee. Well, the trustee is a bank that has offices in Coeur d’Alene, Boise and Henderson, Nev., they have no employees, no offices, no officers within the region.”

Wasden established the foundation in 2017 as part of the $109 million sale of St. Joseph Regional Medical Center by Ascension Health to RCCH Healthcare Partners. Idaho Trust Bank was named the trustor/trustee and the trust created the board of community advisors. The trust was funded with $23 million from the sale of St. Joe’s and $2 million from RCCH. The hospital is now a part of LifePoint Health.

The trust is designed to make charitable grants, contributions or program-related investments to qualified exempt organizations that promote health, wellness or disease prevention for people within the hospital’s service area that includes Clearwater, Idaho, Latah, Lewis and Nez Perce counties in Idaho; Asotin, Garfield and Whitman counties in Washington; and Wallowa County in Oregon.

The trust has awarded about $284,000 in grants in April and August, $800,000 in 2019 and about $250,000 in 2018.

Under the August agreement, the board contends it will not be allowed to foster relationships like it has in the past with Idaho BlueCross Foundation, the Idaho Community Foundation and the Murdock Foundation. The new agreement would not allow the board to contact local governments, health departments, not-for-profits, schools that help to improve the board’s knowledge or where the needs lie in the region.

Under the agreement, the board is restricted to “timely advise and cooperate with the trustee throughout” the grant process.

The board also says in its petition in court that the August agreement runs counter to a side agreement between the board and Idaho Trust Bank in December 2018 that granted the bank permanent trustee status, but empowered the board by two-thirds vote of the maximum number of seats (10 of 15) to remove the trustee bank, subject to approval from the attorney general.

The August agreement instead removes the board’s power to remove the trustee and allows Idaho Trust Bank, with the attorney general’s permission, to dismiss any member of the board and appoint a new member if the board is unable to do so. The new agreement also allows the trustee, with attorney general approval, to dissolve the board under certain circumstances and exercise the board’s responsibilities thereafter.

The August agreement also allows Idaho Trust Bank to increase its compensation for administering the trust.

The Idaho Office of the Attorney General declined to comment on the specifics of the litigation, citing office policy, but did say the $25 million trust fund Wasden established has been a substantial benefit to the region and it is the intention of the office for that benefit to continue.

Idaho Trust Bank President Thomas Prohaska did not respond to a Tribune request for a comment on this story.

Wells may be contacted at mwells@lmtribune.com or (208) 848-2275.