Tension is building between therapists and the board of directors at a world-renowned Palo Alto mental health research institution after the organization announced it will sell its building -- the home of the institution for 61 years -- and become an endowment foundation.
Mental Research Institute (MRI), located at 535-555 Middlefield Road, said in a Feb. 7 press release that it is selling its building and using the proceeds to fund the endowment because the organization has a new mission: to support advancing approaches to human problems "through innovative research, education and practice by focusing on support for organizations and individuals.
"The momentum behind mental health in the 21st century requires breakthrough thinking about how to increase systemic support and understanding of the processes that promote mental health and positive change in individuals, families and organizations," the organization stated.
With the sale of the building, which is being marketed with an asking price of $12 million, an estimated 30 psychologists and therapists who rent space will be evicted. In addition, two long-standing mental health centers at MRI -- the Brief Therapy Center and Strategic Family Therapy, which have been part of the institution for decades -- will likewise need to find new homes and obtain nonprofit status either on their own or through another organization.
The therapists and the two mental health centers were given notice last October by the MRI board of directors to leave by this coming Sept. 30, according to a letter obtained by the Weekly. But it’s likely that therapists of at least one of the affiliated centers, the Brief Therapy Center, will not go quietly.
Karin Schlanger, director of the Brief Therapy Center since 2008 and a senior research fellow starting in 1994, said that MRI has not planned to guarantee the continuance of the two centers that form its core mission, which she said the board should have done. She also questioned the board’s claim of needing to reorganize in order to fund research, since she alleges MRI did little fundraising to further research in recent years.
The institute has provided little opportunity for input from the centers, she claims. Under the board’s plan, the Brief Therapy Center will not receive any of the money from the sale. Schlanger said she has asked for some of the building sale proceeds to be shared with the Brief Therapy Center so it can operate on its own. Schlanger also wants to MRI to transfer one of its two tax IDs for its nonprofit status to the center, which would allow the center to continue to run continuously without having to go through the time and expenses of establishing a new nonprofit status.
But in a letter to Schlanger, board member Mary Ann Norfleet said the Brief Therapy Center would not automatically be supported with any funding from the sale. The foundation would utilize about 5 percent of its funds annually to issue grants to other organizations. The Brief Therapy Center could apply for those grants, Norfleet said.
Schlanger alleges the board could also have averted a shutdown of its core programs by entering into a potential agreement with Momentum for Mental Health, another Palo Alto nonprofit organization, which is looking for additional space.
Paul Taylor, retired CEO at Momentum for Mental Health, confirmed he helped write a letter to MRI inquiring about the building, but Momentum received a polite letter back that the building was only for sale at the fair-market value. Momentum cannot pay the $12 million price tag, he said.
"Obviously, it's a loss of resources. It's a huge loss for the community and more broadly for the mental health field. Not many places have this type of training and therapy," he said. Brief therapy, which seeks to help a person heal in a short span of time rather than through traditional psychotherapy, which can take years, is the perfect service for Momentum to add to its existing programs, he said.
In a Dec. 5, 2018, email, Norfleet wrote that MRI’s board voted against any kind of merger with another organization (such as Momentum). Norfleet noted in a Jan. 12, 2019, email that the board was planning to turn the organization into the MRI Foundation.
Therapist Esther Krohner said losing MRI is tragic on at least two levels. The Brief Therapy Center, where she has also trained, is "magical" for graduate students seeking a mentor. It's rare these days for young therapists to find places offering an oral tradition and apprenticeships, which add much to a therapist's development, she said.
Secondly, Krohner worked with the center to help struggling children in East Palo Alto and Redwood City, and if the center closes, those needy students would lose access to a low-cost resource, she said.
"I was able to work in multiple communities in settings with marginalized kids. We offer them support for low fees when they wouldn't have gotten therapy. From a community standpoint, it offers services for people who had no place else to go and services for people who don't speak English," she said.
More personally, she also has a private practice and rents a space once a week at MRI for $150 a month. That arrangement and low rent allowed her to grow her practice and while also being a mother of two small children.
"I'm very worried about the future. ... I'm scrambling. I recently started considering other avenues, such as virtual therapy, but that's not adequate for the patient from my perspective.” She might use a virtual setup as a transition until she can find another space, she added.
MRI has long played an important role in psychology and psychiatry and the development of both. The institute was established by a group of therapists in 1958 and conducted research and offered therapy. It also developed a large training program that has taught thousands of therapists throughout the world.It spawned more than 700 papers and books, according to the organization, particularly regarding schizophrenia and family therapy.
Its best-known contributors included psychiatrist Don D. Jackson, known for landmark research on schizophrenia; Virginia Satir, who developed the first training program for family therapy, and John Weakland, Jay Haley, Paul Watzlawick, and Richard Fisch, founders of brief therapy and family psychotherapy approaches. (Strategic family therapy focuses on the social situation or family structure rather than an individual and seeks to change behaviors holistically.)
Board members and the institute’s executive director declined multiple requests from the Weekly over the past two weeks to discuss the plans. Upon releasing the press release, Executive Director Sophie Suberville said in an email to the Weekly: "The board has just finished a very thoughtful yearlong planning process to reach these key decisions outlined in the press release. Details about exactly how everything gets implemented is part of the Board’s next phase of planning.
But an Oct. 1, 2018, letter to tenants and other documents obtained by the Weekly shed light on the institute's plans and thinking. Then-board president Thomas Nagy wrote that the aged building was too expensive to repair and needs upgrades, including to its electrical, plumbing and air conditioning systems. He also noted in an email that there were financial considerations not related to the building, such as the sustainability of some of its programs. Nagy, who resigned from the board in December, told the Weekly that he was not authorized to speak on its behalf. (His wife, Karen Nagy, is also involved in the transition, according to one of the emails.)
A 2016 Form 990 filing to the Internal Revenue Service, a requirement for all nonprofit groups, shows MRI had total revenue of $459,991 for the calendar year ending March 31, 2017, compared to $875,596 for the prior year, and revenue less expenses of $103,775 for 2016 compared to $437,584 the previous year. It listed its net assets as $1,310,310 for 2016.
Its total support for its sister nonprofit, Mental Health Institute Trainings, Inc., is listed as $33,614 coming from more that 99 percent public contributions in 2016 compared to $130,020 in 2015.
According to the online commercial real estate website LoopNet, MRI is selling its building through commercial real estate brokers Marcus and Millichap, The approximately 8,222-square-foot building sits atop about 0.36 acres, according to the real estate listing. The property is being marketed for RM-30, medium-density multifamily housing, or for a possible investment as office rental space, according to the Marcus and Millichap offering memorandum.
Crescent Park neighbors who did not know about the proposed sale are concerned about parking and traffic issues or any other attempted uses to which a new owner might try to convert the property. They said the building would have restricted uses under its existing zoning, which limits uses to multi-family residential, day care, a day care home for adults or for families, a garden or an accessory unit among uses in RM-30-zones. The building is grandfathered for medical use and any other sort of office use is not permitted, Crescent Park Neighborhood Association President Norman Beamer said in an email.
John Guislin, who was instrumental in getting the city to institute changes to Middlefield Road because of dangerous traffic, said in an email: "As you know, this is already a congested block. Here is a case where higher density of any kind will cause immediate worsening of traffic problem."