Is Mental Health Association (MHA) a Front to Convert Taxpayer Funds to a For Profit Company?

MHA operates dozens of group homes scattered around the state, primarily in the Springfield area. An MHA master planning report divulged to concerned Holyoke residents reveals that the spacious houses of the Holyoke Highlands have been deemed ideal new locations for multi-bed group homes. 11 Yale will be its first of several new Highlands facilities. MHA claims to be a non-profit entity, a 501(c)(3), meaning the millions in client fees it earns from its group homes—approximately $15 Million in 2017—is all income tax-free. Each group home location is designated as another of MHA’s non-profits. Records reveal that MHA takes in large amounts of city, state, and federal money, as well as thousands per month in insurance money to launch and run its facilities, then hands over that money in rent, salaries, management, and management servicing fees to its for-profit parent company Association Properties Group (APG). Commonwealth records show that MHA’s web of nearly two dozen non-profits worth millions have the same address, same directors, and same officers as the parent company APG. Officers and directors listed for the non-profits claim to work the same number hours for all the entities and APG. Remarkably, APG’s President Cheryl Fasano claims to work 40 hours a week for multiple different MHA non-profits at once.Even the real estate holding company that maintains the houses, MHA Title Holding Company, is a non-profit, whose sole stated purpose is to collect hundreds of thousands in rent, pay director salaries, then transfer money to MHA and APG. 

Even more troubling, MHA’s two dozen houses were purchased with HUD mortgages that are interest-free and have no repayment requirement as long as at least one resident of each home is disabled. MHA has taken over $6 Million in federal tax dollars to buy its real estate holdings, but never has to pay that money back to the government and never has to make payments on its HUD mortgages. Such incredibly favorable mortgage terms are not available to any ordinary homeowners in the Holyoke. According to MHA, none of its tax-free earnings will be used to compensate homeowners whose property values will plummet due to the influx of drug addicts, drug users, and drug pushers, and inevitably, homeless addicts who are kicked out of treatment. 

MHA’s own records show that MHA takes public money to run group homes for opiate and fentanyl addicts, overuses public resources, creates negative neighborhood values, and puts no money back into the neighborhoods it takes over, all for the ultimate benefit of a for-profit company pocketing millions of public aid and insurance dollars, under the guise of being a non-profit.

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