Health care district could be hard sell

District on track for May 15 election

The petition for a county health care district election will soon be on its way to Commissioners Court, but County Judge Sam Biscoe acknowledges that winning the approval of Travis County voters would be an uphill battle.

The city-county steering committee charged with bringing the issue of the health care district to the voters wants to put the referendum on the ballot in May. That gives the group only a handful of weeks after the Texas primary to sell voters on the concept of creating a new taxing entity to handle indigent health care in the county.

Under the proposed legislation, the Central Texas Health Care District would assume the operations, facilities and debts for health care in both Austin and Travis County. Ownership and oversight of Brackenridge Hospital, as well as the city and county’s community clinics, would be turned over to the health care district. StarFlight would continue to be a separate operation that is funded by both the city and the county.

Last week, Executive Director Trish Young told the City Council Health Care Subcommittee that the health care district election is still on track for May 15. Young said the steering committee’s public education subcommittee has developed materials for the campaign. In the coming weeks, weekly emails will be distributed to city employees to inform them of how the creation of a health care district would affect them.

Biscoe believes that most county voters would be opposed to another taxing entity right now, unless those residents have some indication that the health care district would be more efficient and more effective than the current system.

“It’s definitely going to be an uphill battled to get this passed,” Biscoe said.

Commissioners must call an election if a petition with 100 valid signatures is submitted. Most commissioners have expressed support for the concept of a health care district, under the right terms. But Biscoe expects the district to be a hard sell to the average voter.

Biscoe also has doubts about how much money the district can raise. As it currently stands, the plan is to shave a certain percentage off city and county taxes that go to health care and send the money to the health care district. If the city and county contributions are balanced—and city residents have been paying more than county residents—it could mean an extra $5 million for health care.

That’s $5 million in a system that could probably use an extra $50 million in funding, Biscoe said. The money simply does not go far enough to address needs. And the county is about to assume new debt on two additional community clinics.

The ballot language will propose that the county health care district be funded at a rate of no more than 25 cents per hundred-dollar valuation—a rate that might seem steep to voters. In Del Valle, the proposal will be on a ballot with another taxing measure: a proposal for the Del Valle Independent School District to join the Austin Community College System. Voters would thus be deciding not one, but two, new taxes.

If the referendum were approved, a board of health care professionals would run the health care district. Current operational contracts, like the one with the Sisters of Charity to run Brackenridge Hospital, would run until they expire.

Realistically, it could take three to five years to get the district off the ground and functioning on its own, Biscoe said.

County Attorney David Escamilla served as staff support for the city-county health care task force. Escamilla said the health care district is significantly different than the bill originally authored by Rep. Elliott Naishtat (D-Austin). The stand-alone bill was intended to pass through the House on the local calendar, creating a new section of code. Instead, the delays due to redistricting meant local advocates were forced to amend the bill to the omnibus health care legislation, which meant the district could only amend current code.

Under the amended bill, Travis County and the City of Austin will pick a board of directors together. But instead of being a stand-alone quasi-agency, the Travis County Health Care District will have to count on support staff coming from within the ranks of current Travis County employees.

Austin economy still sending mixed signals

Tax revenues up, but so are foreclosures

City Budget Officer Rudy Garza gave the local economy a mixed review in his first quarterly economic update presentation to the Austin City Council. While Garza said some data indicated that 2004 could be the year the local economy rebounds, he also included other reports from sources explaining how the city’s economic recovery could trail other cities around the country. The economic briefing is part of an effort to provide Council members the most up-to-date information as they begin looking at the city’s 2004-05 fiscal year budget.

Nationwide, Garza reported, three key indicators were trending positive. Gross Domestic Product for the U.S. was up in 2003, the national unemployment rate was dropping from its peak in the summer of 2003 and the Consumer Confidence Index was up slightly. However, Garza cautioned that the Consumer Confidence Index was not yet in the range that national experts believed indicated positive movement in the economy, and the drop in the unemployment rate may not necessarily indicate corresponding gains in employment. “Some people are just giving up . . . they’re no longer in the unemployment count.” he said. “Others have accepted lesser positions than what they were used to in the strong times of the economy.”

Overall, unemployment figures in Austin have been tracking the national trend. The national unemployment rate peaked at 6.4 percent in June of 2003, while the Austin rate peaked at 6.3 percent that same month. The unemployment rate for Austin in December of last year was down to 4.5 percent.

On the local front, two lagging indicators showed continued problems in 2003. There was a 61-percent increase in home foreclosures in Travis County compared to 2002, and a 24-percent increase in regional bankruptcy filings. However, the city is experiencing growth in two areas that Council members track closely: sales tax revenues and hotel/motel tax revenues. The Budget Office had predicted two-percent growth in sales tax revenues for the current fiscal year. But thanks to a larger than expected payment at the end of last year and positive trends this year, Garza said, the city was on track to meet or beat that projection.

“If we indeed achieve two-percent growth, which I have every reason at this point to believe that we will, we’ll end up the year ahead of budget,” he said. “For the fiscal year, we’ve received only two payments, and year-to-date we have experienced about a three and a half-percent growth over the prior fiscal year. And at this point, we have to believe that it is an early sign of some turnaround in the economy. If you look at the most recent six months, three of those were positive and three were negative. So maybe we’re a little optimistic, but things are seeming to turn around . . . looking at sales tax.”

The city’s hotel-motel tax revenue for 2003 was up 2.9 percent. That was a significant turnaround from 2002. The projection for the 2004 fiscal year calls for an improvement of 5.1 percent. Garza also reported figures for water utility connections, subdivision site plan reviews and residential construction permits. “We do believe that 2004 is our transition year,” he concluded.

But Council members heard that the prospect of economic improvement is not a reason to abandon the city’s economic development efforts. Sue Edwards, director of the Economic Growth and Redevelopment Services Office, told Council members the city’s efforts to foster an environment conducive to small business growth appeared to be paying off. “Local venture capital funding is on the rise . . . at the same time the filing of DBAs and sales tax permits have increased in recent months, suggesting that optimism and market opportunity are bringing entrepreneurs into business,” she said. New sales tax permits were up by 6 percent from 2002, she said, while DBA, or doing business as, forms filed with the state for Austin jumped by 14 percent from the first quarter of 2002 to the first quarter of 2004. More and more businesses, Edwards said, were turning to the city’s Small Business Development Program for guidance.

The Council’s next economic briefing is scheduled for May 6. The City Manager’s Draft Policy Budget should go to Council by the end of May, and the final Proposed Budget is scheduled to be ready by the end of July. That gives the Council the entire month of August to hammer out changes before the vote on next year’s budget, which traditionally occurs in early to mid-September.

Tonight’s meetings . . . The Sign Review Board and Board of Adjustment will meet in the usual space at One Texas Center, beginning at 5:30pm. The Historic Landmark Commission will have a special called meeting in Room 240 of One Texas Center at 7pm. The panel needs to make a decision about whether to grant a demolition permit for three small houses on West Lynn. (See In Fact Daily, February 3, 2004) . . . Density increase approved. . . A zoning change for 803 and 805 W. MLK sailed through on consent at last week’s Council meeting. The zoning change from MF-4 to MF-6 will allow developer Bill Hale to build 53 condo units on the site. The Judge’s Hill Neighborhood Association supported the change, despite the increase in density, since it secured substantial restrictions on the property during months of negotiations . . . Bill collector hired. . . The Austin Public Library has been given the go-ahead by the City Council to hire an outside collections agency to go after some of the fines for overdue library books. Only accounts more than 60 days old will be referred to the service, and the average outstanding fine will be around $50. According to Patricia Fraga with the Austin Public Library, a fine of that size means a book is more than just a few days overdue. “It’s usually lost books, people that have not returned books,” she said. “We’re trying just to capture some of the revenue to offset the cost of replacing lost books.” The arrangement is expected to net the library about $82,000 per year . . . Pipeline ordinance amended . . . The City Council approved an ordinance repealing part of the City Code that required pipeline operators to purchase expensive insurance. That action was basically a clean-up amendment, in response to Federal Judge Sam Sparks’ ruling that the section was void. Pipeline owners sued the city over a number of issues, including the insurance requirement. They successfully argued that the city is prohibited from enacting any pipeline regulations that would be in conflict with federal law since the federal government has the right to regulate matters of interstate commerce.