Two counties. Nine lawmakers. About 1.2 million people, and a long-held dream for the Rio Grande Valley.
Even for a concept as desirable as a medical school in a region desperately in need of more doctors, the path toward making that a reality promises to not be straightforward.
With the pomp and circumstance of the Legislature’s opening ceremonies over with, Rio Grande Valley lawmakers this past week returned to crafting the language for their No. 1 priority in the 140-day session, a long-sought medical school for South Texas.
While broad support exists among elected officials for the merger of the University of Texas-Pan American and the University of Texas at Brownsville, divisions on the structure, financing and location of the medical school persist.
The negotiations over the entire proposal’s components will test the delegation’s regional cooperation at a time when they must muster statewide support for a measure — the merger — that requires the backing of two-thirds of the Legislature.
Valley lawmakers met for several hours this past week, but no final agreement emerged from the discussions.
But there is “nothing insurmountable” in any disagreements over the universities’ merger and the medical school’s creation, said state Rep. Rene Oliveira, D-Brownsville, the dean of the Valley’s House delegation who will file the bill and guide it through the legislative process. Oliveira, however, did insist that they not let regional rivalries sink the proposal, comparing it to cutting a pie when the flour hasn’t even been made.
“We all have concerns and want to fight for our districts but that fight can come another day,” Oliveira said Friday. “There’s nothing to divide right now. We have to create something and then figure out what’s next.”
UT System Chancellor Francisco G. Cigarroa unveiled Dec. 6 the proposal to merge UTPA and UTB into a new, unnamed university, along with plans to fund the South Texas medical school. The UT board of regents unanimously approved the merger then, but the plan still requires the support of two-thirds of the Legislature, which will also consider new medical school-related spending requests.
Its eventual fate will have huge ramifications for the Valley.
As a new higher education institution, the university would be eligible for Permanent University Funding — an endowment grown through revenues from state-owned land — and would match UT’s other regional universities in student population, research expenditures and endowments. Beyond creating the new university, regents also approved $100 million in funding over the next decade to further develop the medical school.
The starting point for Valley lawmakers when they met last week was a UT-drafted bill that simply abolished the existing universities and created a new one with access to the Permanent University Funding, or PUF. But the bill also deferred to legislation passed in 2009 authorizing the creation of the South Texas medical school with its main campus and administrative offices in Cameron County.
That rankled Hidalgo County legislators, who felt they would not be given a fair shake from the very start. Oliveira said he promised his House colleagues that the existing law for the Cameron County-based school would be struck from the books, adding that the medical school’s location should be a “rational, business-based decision by the UT System.”
“My goal is to pass a clean bill that creates the entity and doesn’t do anything more than that,” Oliveira said. “We don’t need to be picking mascots and school colors or deciding where buildings should be.”
Valley legislators will meet again this week with UT System officials to hash out more details, including financial components.
State Rep. Oscar Longoria, whose district incorporates parts of Harlingen and Hidalgo County, said legislators should let an economic feasibility study determine how the medical school should be developed. Hidalgo County mayors plan to fund a study that will look at the tax base, health care infrastructure and existing residency slots for future physicians.
“There needs to be a study done and then kind of go from there to say, ‘It would be the best fit in this area because of this, this and that,’” Longoria said. “Either way, both counties are going to benefit.”
Other than campus locations, the proposal’s biggest sticking point is whether the medical school will need the support of local taxpayers.
Longoria and other Hidalgo County legislators believe that Valley taxpayers will eventually have to foot a portion of the bill. Officials from both University of Texas-Pan American and the UT System, however, said they did not view a taxing entity as essential to the funding of the medical school and would not ask local leaders to pursue one.
“If they want to find ways to raise money locally, that’s a local decision. It’s not a UT decision anymore than it was a UT decision in Austin,” said Dr. Kenneth Shine, the vice chancellor for health affairs at the UT System.
In Travis County, where voters approved a property tax increase for a medical school in November, the board of regents told local leaders they would only put up $30 million towards $65 million needed for the school. Elected officials turned to local taxpayers to bridge the gap.
For the Rio Grande Valley, UT is seeking assistance from the state legislature to the tune of $20 million annually — an option the system did not pursue for Austin, Shine said. The regents also agreed to put up $100 million over 10 years for the South Texas medical school with additional money to come from the Permanent University Fund.
Even if those funds were not available, Shine said, the Valley is not nearly as property wealthy as Central Texas. Cameron and Hidalgo counties have total taxable property valued at close to $43 billion, compared to more than $98 billion in Travis County.
But proponents of a local taxing district say adding a nickel to the tax levy on each $100 in property valuations would generate more than $13.6 million annually in Hidalgo County alone.
For someone who owns property worth $100,000, that extra nickel on the levy would add an extra $50 to their property tax bill every year.
With Texas struggling to fund essential state services, it’s unrealistic to expect state lawmakers to budget $20 million for the Valley’s medical school when those elsewhere are supported locally, said Hinojosa, listing Austin, El Paso and San Antonio as other areas that pay part of their medical schools’ costs.
“It is not a simple undertaking to set up a medical school with all the supporting infrastructure and tax base,” Hinojosa said. “You’ve got to understand what is anticipated to happen down the line.
“It involves taxes: who pays for them, where they go and how they’ll be used.”
SOMETHING FOR EVERYONE
And taxes are where most talk of regional cooperation breaks down.
Hidalgo County officials, including the McAllen and Edinburg mayors, are reluctant to back any proposal that sends a large chunk of their tax dollars to a Cameron County community some 40 miles outside their city limits. They also are doubtful Cameron County, with about half the population and tax base, is large enough to support a medical school with its own.
Add in the persistent propensity for the Valley’s cities to compete with one another, and it’s resulted in sensitive negotiations — even as area lawmakers promote the need for regional cooperation in Austin. With Valley lawmakers coalescing behind the merger of the universities, the looming question is whether they can find common ground on the medical school.
UTPA President Robert Nelsen said the Valley’s lawmakers understand that the merger will require a “regional approach” but conceded “there are still concerns about how you finance it all.”
Nelsen said he did not see a taxing district as necessary given the support of the regents, expected legislative funding and savings from the university merger. He added that research at the new medical school and university will also generate significant revenue.
“I don’t think it’s thought through yet, personally,” he said of the taxing district.
He said the disagreement over the location of the school’s main medical campus — an issue that has become intertwined with the approval of a taxing entity in some talks between lawmakers — betrays an “old understanding” of how a medical school can function.
“It’s not about that old model where you’ve just got one big teaching hospital,” Nelsen said. “It’s time to go past that and that’s the real opportunity here.”