What happened at Legend Gardens? State shuts down Palm Desert assisted living facility abandoned by owner
From the outside, everything seemed ordinary at Legend Gardens, an assisted living facility in Palm Desert, on Wednesday afternoon. The sun was shining and bright pink bougainvillea bushes blossomed along one side of the building, but, inside, there was no one at the front desk.
One resident, using a walker, went back and forth between the main room and the lobby, getting her exercise in for the day. A sign-in sheet and thermometer sat unattended beside an advertisement for Bayshire, another senior community, in Rancho Mirage.
About 10 Legend Gardens residents will be moving there within the next few weeks. The rest will be finding somewhere else to go. They all need to leave by Jan. 2, according to Community Relations Director Carrie MacDonald.
The California Department of Social Services, which oversees the licensing of assisted living facilities, says the residents actually have until Feb. 4. The state is shuttering the indebted company after months of trying to deal with its mostly unresponsive owner, Mark Hellickson. The property itself is scheduled for auction Dec. 14.
Hellickson has essentially been M.I.A. He hadn't responded to calls, emails and texts from his staff nor had he responded to requests from the state social services department. He was considered to have abandoned the building and, as of last month, had stopped paying employees. The day before Thanksgiving, payroll checks made out to the entire staff had bounced — there were insufficient funds in the account.
Since then, the already struggling facility has been taken over by a temporary management company contracted with the state until its 32 residents find new homes.
On Thursday night, a representative with the California Department of Social Services said that it has "received communication" from Hellickson, but did not provide details about when or how that communication was delivered.
The department has filed an accusation to revoke the license of Legend Gardens and to exclude Hellickson from future ownership or employment of facilities licensed through the department.
Social services is investigating a claim that a patient in Legend Gardens' memory care unit had their credit card charged last weekend — a claim that has also been reported to Adult Protective Services.
Hellickson did not respond to requests for comment from The Desert Sun and the phone number listed for his real estate development company, Prospect Companies (Prospect LG LLC.), has been disconnected. His most recent address is listed as an apartment in Waikōloa, Hawaii.
Despite making jokes that he must have fallen into a volcano, Legend Gardens staff seemed confident that Hellickson is alive. A staff member said Hellickson recently posted about hiking on the island and, just this week, someone using his account "liked" a family member's post on Facebook.
No supervision at the facility
Community Relations Director Carrie MacDonald said she has been the unofficial administrator of the facility since September, but state documents indicate she may have been filling in off and on for months since March. MacDonald has been doing payroll by hand since late summer, staying as late as 8 or even 10 p.m. to get it done.
Though she tried to contact him, MacDonald said she never actually had a conversation about any of this with her boss. Employees haven't been paid in a month, she said.
MacDonald, who usually has a lot of interaction with families as the facility's head of sales and marketing, is not a certified administrator. Administrator certification is required in California and facilities that don't have one can have their licenses revoked. The California Department of Social Services is supposed to be notified within 10 days if there are any changes in administrators — Legend Gardens failed to do this.
Between Sept. 22 and Nov. 29, the facility was fined $32,000 in civil penalties. Many of the charges are for failing to make corrections and failing to provide the state with information regarding its administrator as well as its problems with utility companies.
An island of unpaid bills, mounting debt
The state's evaluator was informed during its Nov. 29 visit to the facility that checks made out to 33 employees were returned for insufficient funds. While there, the evaluator learned that TGG, Legend Gardens' accounting firm, had ceased operations with the facility and Hellickson. The firm had attempted to reach out to Hellickson to discuss the payroll issue but received no response.
Legend Gardens hadn't been paying its mortgage or utility bills for months.
In May, the company had an unpaid balance of $7,934 in electricity bills and had been issued a notice warning them of a potential stop in services due to nonpayment.
On June 22, the facility's mortgage lender had emailed the company, writing “We all agreed that we would extend your foreclosure sale date about 90 days if you paid $143,479.65,” according to state documents.
California Department of Social Services said Legend Gardens was issued a notice on Aug. 8 that its water would be shut off unless the bill was paid within 10 days. Water service was not discontinued, but the facility received a similar notice again Oct. 13.
On Sept. 8, the facility's dumpster was overflowing, surrounded by several additional bags of trash, according to the observations of a Licensing Program Analyst evaluating the facility for the state. During her visit, staff told her trash service stopped Aug. 27 due to non-payment.
Southern California Edison statements provided to an auditor in early October indicated that the facility had recurring past due notifications and large previously unpaid balances. There were also past due balances for phone bills dating back from October and December 2020 — more recent statements for phone services were not provided to the auditor, according to state documents.
The Oct. 5 audit revealed the company didn't have an adequate financial plan to make sure it could meet its operating expenses. Between October 2020 and May 2021, bank statements showed the company had recurring nonsufficient funds and/or negative and low balances. There wasn't enough income to ensure care for the residents it already had, nor did it have sufficient cash reserves.
The auditor found Hellickson had failed to maintain financial records and/or submit them at the request of the state. Hellickson did not respond to any of the auditor's inquiries.
In its shutdown order for the facility, the state concluded Hellickson should not be able to be the majority owner of, or operate another, residential facility for the rest of his life based on the allegations.
Residents await new homes
Robert Evans, 59, is the youngest resident of Legend Gardens. He's lived there for about seven years and, on Wednesday, was disgusted in the alleged actions of the facility's owner.
"I don't know how a man can come in and buy an organization like this without realizing that we're actual human beings — not all dollar signs," Evans said. When he learned the staff had been working without pay, he said he was grateful but would have understood if they'd left.
"It's because they love us," he said. The staff even took it upon themselves to host Thanksgiving dinner for the residents, and he said that it was the best one he'd ever had there.
"For a lot of these older people, it's been rough," Evans said. "I keep telling them that it'll be OK."
Evans will be one of the residents relocating to Bayshire in Rancho Mirage.
"We’re trying to match rates as best as we can," said Lena Angell, director of business development at Bayshire. "It’s not fair that their home got taken away from them."
Angell has been working with Brett Shepard with Omni Senior Services to help figure out how to get residents into new housing.
"One of Omni's goals is to get as many residents to the same facility as possible to keep them close to their friends," Shepard said, calling Legend Gardens a "close-knit" community. "Their friends are an extremely important part of their life right now."
However, differing care needs and budgets are a complicating factor, Shepard said. Some residents at Legend Gardens had been grandfathered in at lower rates that are no longer available in the market, he said.
MacDonald didn't seem too worried about finding residents new homes. She said most would probably be out before the Christmas holiday.
Future uncertain for caregivers, staff
This was Naomi Saavedra's first job as a caregiver and med tech. She's been there three years and, on Tuesday, said she didn't expect to like it so much.
"It’s like they’re your second family," she said.
"Most residents, they were pretty upset about it just because it was their home and they were happy there," Saavedra added. "They did not want to leave."
The temporary management company that's taken over Legend Gardens, R2R Ventures, LLC, has also taken over payroll and is paying staff more than they were previously earning. The staff has been told they will receive backpay from the state "soon."
But, when her check bounced ahead of Thanksgiving, Saavedra said she was charged overdraft fees. Her bank only agreed to waive 50%.
"It's better than nothing," she said.
The lost wages have been cross-reported to the California Department of Industrial Relations, according to social services representatives.
Many of the employees have already been approached by other facilities hoping to hire them. Right now, though, both Saavedra and MacDonald said they're focused on taking care of the approximately 23 residents who remained on Wednesday.
Editor's Note: This is a developing story that will be updated as more information becomes available.
May 2020: ‘I was trapped’: Coronavirus in California's nursing homes
Health reporter Ema Sasic contributed to this story.
Maria Sestito covers issues of aging in the Coachella Valley. She is also a Report for America corps member. Follow her on Twitter @RiaSestito, on Instagram @RiaSestito_Reporter or email her at maria.sestito@desertsun.com.
This article originally appeared on Palm Springs Desert Sun: State shutters Palm Desert assisted living facility, residents relocating
