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Justice Department raid touches off call for Timberline development halt

Developer says no connection from Rocklin search to Western Care Construction’s North Auburn proposal
By: Gus Thomson, Journal Staff Writer
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A state Department of Justice search at Horizon West Healthcare’s Rocklin headquarters is causing reverberations with the Timberline seniors housing project in North Auburn. Community activist Dale Smith and the newly formed North Auburn Ad Hoc Committee to Save Our Quality of Life group are calling for a halt to the 109-acre Timberline’s approval process in light of the May 25 raid. But the developer says the connection is not there and it’s a “grave mistake” by opponents of the project to allege there is. Smith’s Alpha Omega Associates consulting business and the group, which Smith said numbers more than two dozen, are connecting well-known businessman Martin Harmon as a principal in both Horizon West Healthcare and Timberline developer Western Care Construction. Harmon is Western Care chairman and president and chairman of the board. He’s also president and chairman of Golden Legacy Inc., the owner of Horizon West at the time of the raid. Smith said he and the group have e-mailed Placer County planning staff and Board of Supervisors members demanding that the development process on Timberline be halted. “If they’re smart, they’ll pull the plug on it for awhile,” Smith said. In an e-mail to the Journal, Harmon’s office described the Timberline project as a potential positive addition to the Auburn community that would provide a top-of-the-line retirement facility, construction jobs, and, over the longer-term, healthcare-industry jobs. “There is no connection of any kind between the Timberline project and the Department of Justice investigation and those who oppose the project by connecting the two are making a grave mistake which will only harm the community,” the Harmon e-mail stated. Smith, who lives about two-thirds of a mile from the Bell Road-Richardson Drive project, said the project application should be withdrawn immediately pending clarification of the situation with Harmon. “We believe that to spend one more penny of taxpayers money to proceed with this application now that this very heavy cloud hangs over the proponents would be a grave injustice to the public,” Smith said. The search warrant was served May 25 morning on Horizon West’s 4020 Sierra College Blvd. offices. Justice Department spokeswoman Michelle Gregory confirmed that the search took place and it involved an investigation by the state Attorney General’s Bureau of Medi-Cal Fraud and Elder Abuse. “Because Horizon West Healthcare has nothing to hide from the Department of Justice investigators, we have attempted to cooperate fully with the Department of Justice investigation and will continue to do so,” the Harmon e-mail stated. Horizon West has recently been involved in a civil court case unrelated to the Justice Department investigation. Thirteen months ago, a Sacramento Jury found Horizon West care home Colonial Healthcare in Auburn guilty of elder abuse in the death of a 79-year-old woman and awarded her family $28 million in punitive damages. The family and Horizon West later have since settled for a lesser amount. In February, Horizon West Healthcare agreed to sell its 27 facilities – including two in Auburn – to San Marcos-based Plum Healthcare Group. That sale was finalized Tuesday, pending state approval, said Deborah Pacyna, director of public affairs for the California Association of Health Facilities. The Western Care proposal for an 858-unit residential development for seniors has moved through the initial stages of the county‘s planning process. The Placer County Planning Commission approved several aspects of the project in early May but that decision is being appealed by Smith and the residents’ group. The appeal means project approvals will be revisited for final approval by the Board of Supervisors. Smith said no date has been set yet for that hearing. Michael Johnson, county Community Development Resources Agency director, said Placer is considering a Justice Department search of Horizon West headquarters and the Timberline approval process as two separate issues “until an agency tells us there are concerns we have to address.” Johnson said that no public funds are being spent on the Timberline development. Costs are entirely paid by the project applicant, including staff time, he said. At the May 12 Planning Commission meeting, opposition focused on the height of some Timberline units, the size of the project in relation to nearby homes, and plans to stage development over more than a decade. Proponents praised the job creation both during construction and after buildout, as well as the need for more seniors housing in the area. Smith also spoke about the county’s ability to try to ensure the project developer was in a financial position to see the project through to completion and not leave North Auburn with a half-finished development. “There are several reasons for requiring the project applicant to submit financial information about the gross and net revenue to be generated by the project over its anticipated life,” Smith said in a statement accompanying the demand to stop the development process.