TALES TO LOOK FOR IN 80TH SESSION TESTIMONY

As the Blogmeister pointed out earlier, UTMB staff and faculty and Galveston's citizens (not to mention TFA staffers, the ones not sitting in the hearing room, that is), can watch committee testimony via a live webcast and then, if something not quite right surfaces in testimony, correct it by contact the committee members directly with the right information. What follows are some suggested topics to listen for and react:

• Claim: UTMB is running a deficit.  Response: No, it is not.  Even Dr. Stobo admits that UTMB is and has been in the black.  Send legislators a copy of the FY06 "Exhibit B - Combined Statement of Revenues, Expenses and Changes in Net Assets" in the financial statement.  Circle the bottom lines of the last two columns, all the way to the right, that show an increase in "Ending Net Assets" from FY05 to FY06. 
• Claim: UTMB is running an operating deficit.  Response: Not now.  Dr. Stobo, on November 2, 2006, announced that the operating deficit was down to $9.4 million.  Ben Raimer announced that UTMB had identified $40 million in savings from personnel and position cuts.  That deficit is history. Send the committee the link to Dr. Stobo's announcement AND a copy of the Galveston County Daily News Article in which Ben Raimer made his $40 million announcement. 
• Claim: UTMB is dealing with 6% medical inflation.  Response: That's not what the financial statements show.  Print out the blog entry laying out the small increases in hospital and clinic spending over the last four fiscal years except one and send it to the committee in question.  Better yet, send them the appropriate pages from the financial statements from those years (they're linked in the blog entry on inflation).  Point out that one year does not a trend make, particularly when the percentage increase/inflation rate dropped like a stone in FY2006. If inflation were a 6% factor, it would be reflected in spending.  While every fiscal year prior to FY05 experienced some increase, only one year, FY05, came near administrators' assertions of high inflation. The rate dropped below zero in FY06.
• Claim: UTMB must deal with depreciation expense.  Response: (1) Depreciation is not an expense that UTMB absolutely, positively must pay to somebody else.  It's merely an accounting maneuver to account for the use of the facilities. Some institutions pay this expense to themselves and then use the money for upkeep and new buildings.  Some don't.  Some use money entirely unrelated to depreciation expense. They all show depreciation, though. (2) Depreciation is not something that slipped up on administrators in the night.  It has been there all along, and all along UTMB has met its depreciation costs. 
• Claim: UTMB's net assets are tied up in buildings and plant.  Response: Again, print out Exhibit B of the FY06 Statement (linked above) and send it to the committee receiving testimony.  Each entry along the bottom of the two sheets that comprise the exhibit show the funds in each category at the end of the fiscal year.  Less than half of UTMB's FY06 ending net assets are tied up in plant. 
• Claim: UTMB's financial statements show a balance in funds, but they're all obligated.  Response:  Not necessarily true, either, depending on which fund they're talking about.  Another accounting procedure comes into play here that can mislead some.  Let's look at the breakout of Educational and General funds.  Click on the following link to see the FY06 "Schedule B-1: E&G Funds - Summary of Operations":  Download financial_eg_funds_fy06.pdf . Now, take a hard look at the note toward the bottom.  The note, along with the figures provided, essentially says that the entire $44.4 million E&G ending balance and more is eaten up by expenses and obligations.  It claims $48,119,233 (the number in parentheses) is obligated out of $44,875,674 available in the ending E&G net assets as of August 31, 2006.  But take a closer look.  UTMB lists "Accounts Receivable (less deferred revenue portion)" as an obligation.  Friends and neighbors, that's money coming in, not going out.  It's not a bill they're going to pay.  If somebody overspent E&G by $3.2 million, they ought to be fired.  [Please see correction to this paragraph in the next post.]

TFA will provide other key items to listen for and talking points in coming days.  The Legislature needs to understand that while everybody would like to see UTMB get more money, UTMB can easily afford to restore the pay cuts inflicted on faculty and restore tenure to its proper place, as a guardian of academic freedom.  Perhaps all those personnel cuts weren't quite as necessary as people believe, either. 

Comments

How many people were actually RIF'ed? 354 is the number I keep seeing, but does that number take into account people who were rehired into different positions? I wonder if the personnel cuts were actually aimed at getting rid of folks who were deemed insuffienctly "institutionally minded".

Hopefully the Texas Legislature or Governor will decide to help UTMB. The uncertainty created by the current UTMB administration is hurting recruitment of medical students and applicants for the large numbers of positions in the first year medical school class and postgraduate residency programs. Potential medical students and medical school graduates simply are not willing to take a chance on their future education with such uncertainty in the air. This problem, if not solved in a definitive manner, will hurt the institution for years to come.

The Texas Legislature will most probably decide to help UTMB. This means that State Dollars will flow in. But the real problem is not money, as has been amply documented by the blogmeister, but low morale and lack of identification with the institution. These are fundamental problems that a new leadership must address. Unless of course the UT captains have decided to dump the useless ship into the deep waters.

Back in July, it was noted on this blog that Galveston County's state legislative delegation called for a state performance review of UTMB before requesting increased funding. Did this review ever happen?

[Blogmeister note: Good question! I'll see what I can find out.]