UT-Austin would like a medical school. Texas A&M has one, Baylor has one, the University of North Texas has one and Texas Tech has two — one in Lubbock and one in El Paso. The UT System already has several, one each in Houston, Dallas, Galveston and San Antonio. But not Austin.
UT is looking to change that. Plans are in the works for a new medical school in Austin, with associated clinics, medical research facilities and a teaching hospital serving Travis County. But to make all that happen, the University needs a steady, reliable source of funding, which has yet to materialize.
By UT’s estimates, construction and operation of the medical school for 12 years would cost about $4.1 billion. The Board of Regents has committed at least $25 million per year from the Available University Fund and an additional $5 million per year for the first eight years to help with equipment and other startup expenses. But that covers less than 10 percent of the expected total cost. To make up the difference, UT has cobbled together funding from a number of sources, including a possible $250 million for the proposed teaching hospital from the Seton Healthcare Family, which has partnered with UT in the past. But UT still needs about $35 million per year, and for that the University is turning to Travis County taxpayers.
On Nov. 6, Austinites will vote on Proposition 1, which, if approved, would institute a 63 percent increase on their property taxes for health care. This would raise the average Travis County resident’s property taxes by $107.40 in 2014. According to the University and Central Health, Travis County’s hospital district, this extra tax revenue will cover the remaining cost of the medical school.
The proposal also aims to secure additional funding from the federal government through a Medicaid waiver program created last year that provides $1.46 for every $1 invested in health care improvements for a community’s poor. According to Central Health, the $54 million from the tax increase would draw another $76 million from the feds.
The University justifies the tax increase by arguing that the Travis County voters footing the bill would see a significant return on their investment. “It’s important to remember that the tax revenue would be used to pay for health care — not research and not buildings,” said UT spokeswoman Tara Doolittle.
Opponents of the tax increase believe that if UT wants to build a medical school, it should cover the cost itself. But the University’s problem is that its two main sources of revenue — endowments and appropriations from the Legislature — are not reliable enough to fund such a large-scale initiative.
Endowments are inherently unpredictable, as they are largely based on economic climate. The Legislature could provide steady funding if it wanted to, but it doesn’t always want to. “It is impossible to predict the will of the Legislature or the economic factors that influence both it and donors,” Doolittle said. “In order for this venture to be successful, the predictability of recurring funding is needed for this last piece, and we will not be able to move forward unless such funding is secured.” That’s why the University is looking to the tax increase to provide a steady revenue stream.
A new UT-Austin medical school would be highly beneficial to the city, the state and Texas’ flagship university. It’s unfortunate that the Legislature can no longer be relied on to fund such an advantageous initiative, and in light of that, a tax increase like Proposition 1 is probably the only viable option if UT-Austin is to come up with the money it needs.
Feeling hard-pressed to make sure that money materializes, UT’s Executive Vice President and Provost Steven Leslie put in his rather lengthy two cents, calling for the passage of Proposition 1 in an Oct. 10 email to faculty and staff. The email was then published in the Austin American-Statesman. “For us, this is a yes or no proposition,” Leslie wrote. “Without a complete and reliable source of new funding, we will not be able to start a medical school … A medical school would immediately complement our engineering, natural sciences, nursing, pharmacy, social work, and other programs, strengthening them individually as well as the University’s overall reputation.”
Leslie could not be reached for comment, as he was in China at the time of this writing. It remains to be seen whether Travis County voters will agree to raise their taxes and give UT the medical school it is asking for and if UT faculty and staff will respond positively or object to the University’s Executive VP telling them how to vote.
When they go to the polls, voters should take into account the lack of viable options for funding that UT-Austin faces. We can’t count on our endowment or on our Legislature, but we should be able to count on our community.