As Prime Healthcare crunches numbers on a potential purchase of Our Lady of Fatima Hospital and Roger Williams Medical Center, the income side of its ledger is poised for a $2 million boost.
The extra money comes from a settlement with the city of Woonsocket, where Prime Healthcare Foundation owns and operates Landmark Medical Center. The Woonsocket City Council authorized the payment agreement with Prime under a resolution presented at its meeting Monday. The settlement resolves a longstanding dispute – including three lawsuits – over city tax assessments and bills to the hospital operator that began a decade earlier.
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“It’s a lot of money, but it’s very fair,” City Solicitor Michael Lepizzera told the council during its Monday meeting.
Fair perhaps to Prime Healthcare Services – Landmark LLC, the local charity owned and operated by Prime’s nonprofit foundation, which alleged in the trio of lawsuits filed in Providence County Superior Court in 2018 and 2019 that the city “illegally” inflated the assessed value of its Woonsocket hospital properties and equipment, leading to “excessive” tax bills from 2015 to 2018.
As part of the settlement, Prime and the city have agreed to toss the lawsuits with prejudice – meaning Prime can’t bring the same complaint against the city again.
“We appreciate the City of Woonsocket’s partnership in resolving tax assessments from the period before Landmark Medical Center was formally recognized as a nonprofit,” Noel True, a spokesperson for Prime, said in a statement Tuesday. “This agreement is the result of a collaborative process that reflects our shared commitment to supporting the hospital’s mission and ensuring stability for the community. We look forward to continuing our strong relationship with the City and providing high-quality, compassionate care for the Woonsocket community for generations to come.”
True did not address how the settlement might affect Prime’s ability to buy Roger Williams and Fatima.
The struggling hospitals face imminent threat of closure by their bankrupt owner, Prospect Medical Holdings, without a sale by the end of the year. The Centurion Foundation, an Atlanta nonprofit received conditional approval to buy the facilities in June 2024 but has been unable to raise the money for the purchase. Amid delays and signals of closure, Gov. Daniel J. McKee’s administration brought in Prime to gauge its interest as an alternative buyer.
An attorney for Prospect told a Texas federal bankruptcy judge on Nov. 25 that he expected to have an update on a deal by Friday. True did not immediately respond to questions regarding the status of Prime’s due diligence on Tuesday.
The Centurion Foundation is on track to secure the investor-backed bond financing “on or around” Jan. 15, CEO Ben Mingle wrote in an affidavit submitted to federal bankruptcy court Monday. Centurion also asked the federal bankruptcy judge to deny Prospect’s motion to close the hospitals by Dec. 31.
“We are very pleased the new financing process is now underway and we are eager to work with the State’s leaders to meet this financing schedule,” Mingle said in an email Tuesday.
Attorneys for the parties are expected to provide an update at Friday’s court hearing in Dallas.
Back in Woonsocket, the City Council is firmly focused on former Mayor Lisa Baldelli-Hunt, who it blames for the costly settlement with Prime over Landmark taxes.
“This is part of the Ponzi scheme that was being run out of this building by the prior administration,” Councilor James Cournoyer said during the meeting.
He repeatedly referred to Baldelli-Hunt as the “disgraced former mayor” and her “best-in-the-state tax assessor” Elyse Paré, mocking the descriptor of Paré given by Baldelli-Hunt.
Baldelli-Hunt led the city for a decade before resigning abruptly in November 2023 in the wake of a land purchase that violated city charter rules, first reported by WPRI-TV 12. Since she left, city officials have continued to grapple with the fallout of her administration, from sloppy bookkeeping to employee turnover and a series of settlements with other companies and property owners over allegedly inaccurate property assessments.
Including the $2 million deal with Landmark’s owners, Cournoyer estimates the city has spent $5.5 million to resolve disputes over excessive property tax assessments from Baldelli-Hunt’s administration, including with the owner of a pair of shopping centers on Diamond Hill Road.
“This is part of a broader pattern,” Cournoyer said in an interview Tuesday.
Baldelli-Hunt, however, turned the focus back on current elected officials.
“Sometimes people find it easier to settle than to fight for what’s right,” Baldelli-Hunt said in an interview Tuesday. “They’re not fighting for the city of Woonsocket.”
Paré, who left Woonsocket in 2019 to take a job as tax assessor for the city of Providence, did not immediately respond to inquiries for comment Tuesday. She left her job with Providence in 2021 and now owns a wine bar in East Greenwich, according to her LinkedIn page.
Baldelli-Hunt also said the tax years in dispute were a period of transition for Landmark Medical Center, which limited her authority over tax assessments. Prime bought the struggling hospital in 2013, following a five-year bankruptcy process. In 2017, Prime successfully converted the facility from for-profit to nonprofit status. Prime’s lawsuits also alleged the city wrongfully billed it for property and tangible taxes in 2018, even though as a federally recognized tax-exempt organization, it no longer had to pay local taxes.
Roger Williams and Fatima would also be returned to nonprofit status under a sale to either Prime or Centurion, the buyers said. Without new, voluntary agreements with the city of Providence and town of North Providence, the sale and change in status would cost the two municipalities a combined $8.5 million in property taxes in fiscal 2026, according to their leaders.
The city of Providence has not had any formal discussions with any buyers regarding an alternative tax payment schedule, Anthony Vega, a spokesperson for Mayor Brett Smiley’s office, said in an email Tuesday.
“The City remains committed to doing everything possible to ensure the hospital continues serving the community while maintaining proper fiscal stability,” Vega said.
North Providence Mayor Charles Lombardi also said he had not spoken with Centurion or Prime about tax payments to the town.
“We’re hoping it’s for-profit so then we get tax dollars,” Lombardi said in an interview Tuesday.
Woonsocket has forgone property and tangible tax payments from Landmark since 2019; it would have received more than $1 million in property tax revenue alone based on the $50 million assessed value of the main hospital facility.
The city’s settlement payments back to Prime are spread out over the next five years, with an initial $250,000 payment by Dec. 31. Jim Lathrop, the city finance director, confirmed in an interview Tuesday that the city has enough money to make the first payment based on revenue from an October tax sale.
But fulfilling the future financial obligations to Prime might be difficult, Lathrop acknowledged.
In addition to the $2 million payments, the city has also agreed to suspend fees for water and sewer charges, and issue credits, equal to $80,000 by Sept. 1, 2029.
“We’re getting hit twice,” Council President Dan Gendron said during the meeting.
Cournoyer warned of future tax hikes.
A $500,000 payment — the amount due each year for 2026, 2027 and 2028 — represents 1% of the existing $55 million annual city tax levy.
“That puts a considerable strain on finances, that will likely result in us having to raise taxes at a greater rate than we otherwise would have,” he said.
Lathrop hinted that there be alternative savings strategies that would cover the settlement costs, but declined to specify when asked, awaiting action by the council.
Nancy Lavin is a senior staff writer for the Rhode Island Current.
