FULL DISCLOSURE: I resigned from TransCare in October of 2015
TransCare in New York City issued the following statement to it’s employees this afternoon:
As you are likely aware, TransCare has been in the process of restructuring the company to return it to sustainable profitability. While we have addressed many of the underlying issues, some challenges still remain.
As part of the restructuring process, we have analyzed each division of the company —Maryland, Pittsburgh, Hudson Valley, Westchester, MTA Pararansit and the NYC 911 and Core businesses.
During this restructuring evaluation, the MTA required that we set up a separate entity to segregate the paratransit business from TransCare’s ambulance businesses, including separate bank accounts and financial records. We are pleased to say we have accomplished setting up and capitalizing the separated paratransit entity which will now be called Transcendence Transit II, Inc. It is our hope that this change and new capitalization will encourage the MTA to rapidly return routes to us that were recently curtailed.
Simultaneously, we have formed a new company, Transcendence Transit, Inc., that will acquire our stronger performing ambulance business divisions in Pittsburgh and the Hudson Valley. Aside from the name of the new legal entity, nothing changes operationally for the businesses in Pittsburgh and the Hudson Valley. We believe that through these restructuring efforts we have been able to save 700 jobs.
Sadly, as a result of a decision by our senior lender to cease providing additional funding, the remaining operations (NYC 911, Core, Westchester and Maryland), which have continued to face significant challenges throughout the restructuring process, are being forced into liquidation under Chapter 7 of the Bankruptcy Code. The operations associated with these businesses will discontinue starting today and responsibility for their remaining assets will be transferred to the custody of a court-appointed trustee.
For those at work currently or scheduled to work today, please continue your usual good service until such time as you hear from the court appointed Trustee. We expect the appointed trustee to be able to provide you with further direction and answers to your questions in the days ahead.
Please know that we have worked hard for months now to restructure the entire business. Unfortunately, today’s events made that impossible, and we are deeply sorry for the job losses and any service interruptions for the communities we have served.
TransCare was the provider to a number of facilities for their discharges and inter-facility transfers, supplied over 20 ambulances to the New York City 9-1-1 system in conjunction with it’s voluntary hospital partners, and was the 9-1-1 provider for the cities of Mt. Vernon and White Plains.
The sudden cessation of New York City and Westchester County operations, although not entirely unanticipated, was done abruptly and with little to no warning or guidance. While the message cites that 700 jobs were “saved”, it fails to mention the estimated 1,200 jobs lost in the New York City and Maryland operations.
TransCare was owned by the private equity firm Patriarch Partners, led by Lynn Tilton who has a very prolific Twitter presence. The private equity firm specializes in a porfolio of distressed companies, primarily in the manufacturing industries.
There is a lot more I can say on this subject (see the disclosure above) but honestly it would be to no one’s benefit. Right now there are A LOT of people who did everything they were told to and everything they could but still lost how they were able to feed, clothe, and support their families in one of the most expensive places in the world to live in. This is nothing less than tragic and nothing should distract from that FACT.
20:00 UPDATE: FDNY has issued a statement regarding their contingency plans to cover the 81 tours left vacant by TransCare. The 81 tours equate to
972 648 unit hours daily, since TransCare units operated on 12-hour tours.
02/25/16 00:15 UPDATE: Another message was sent out late last night from TransCare Management that says the following:
We are writing to be certain that the information people are receiving about the TransCare restructuring is accurate. As we noted in our earlier communication, we have been working for months to try to restructure the business and save the jobs of our valued employees.
Unfortunately, one of our senior lenders decided to cease funding, and we have been forced to file certain of our business units — the NYC 911, NYC Core, Westchester and Maryland businesses — for Chapter 7 bankruptcy.
These businesses have NOT been immediately shut down.
Tomorrow certain assets of TransCare will be in the hands of a court appointed trustee who we expect will have the needed runway to effect an orderly wind down.
As stated previously, TransCare’s existing ambulance divisions in Pittsburgh and the Hudson Valley will be acquired by Transcendence Transit, Inc. Aside from the name of the new legal entity, nothing will change operationally for these businesses or their respective employees.
In addition, TransCare’s paratransit business will be acquired by Transcendence Transit II, Inc. No positions in this business will be eliminated as a result, and all employees of the paratransit business will be employed by this new legal entity.
We believe that through these restructuring efforts we have been able to save 700 jobs. While we are disappointed that we could not save all the business units and jobs, we are grateful that much of TransCare’s history can live on.
The TransCare Management Team
It has been confirmed that as of this update, TransCare ambulances are STILL OPERATING. Apparently for how much longer will be left at the decision of a court appointed trustee later today.
OPINION: This second message, that had to be sent in order to clarify the first, demonstrates the type of vagueness that has plagued TransCare communications for the last few years. For the last 11 hours there have been numerous Facebook posts, news articles, and of course Tweets regarding the situation.
Still, it took 11 hours to clarify what should have been made clear from the beginning. This does not make the situation any better, but only illustrated one of the reasons that it has occurred.