Gov. Perry to "Fully Fund Business Capital"

Governor Rick Perry and the Texas Legislature plan to fully fund business capital via the Texas Enterprise Fund and Emerging Technology Fund.

Gov. Perry's multimillion-dollar economic development funds are not cut in the budget

Perry won't lead by example.  Public education and health care face budget cuts of 25 to 33%.  Apparently education and health expenditures aren't investments in Texas' future.  The Governor's website states:

To date, the TEF has invested more than $430 million and closed the deal on projects generating 57,305 new jobs and more than $14.7 billion in capital investment in the state.

Almost 10% of the $430 million went to one company, Vought Aricraft Industries in April 2004.  It promised to provide 6,300 jobs by 2010 for $35 million in TEF funding.  Instead of providing the promised 3,000 new positions, it cut 35.  Governor Perry gave Vought $1 million per job eliminated.

Vought committed to invest $558 million in its Dallas-Fort Worth, where it planned to consolidate operations and build portions of the fuselage for the Boeing 787 Dreamliner. Vought's 2004 SEC filing shows:

On February 26, 2004, we announced plans to consolidate much of our manufacturing operations in Dallas, Texas. To help us accomplish this major restructuring, we will receive a $35 million grant from the Texas Enterprise Fund and will work with the Texas General Land Office and several other state and local agencies. Although plans are not fully finalized, we intend to renovate and modernize the Dallas facilities, close the Nashville and Stuart sites, and reduce the size of the Hawthorne site over the next 18 to 36 months.

No consolidation occurred.  Dreamliner production went to South Carolina, partially financed by Texas taxpayers..  The 3,000 "new jobs" Perry claims came from Vought were already in place in 2004.  The $558 million in capital on Perry's report never happened.  It's complete fiction, something the AP missed.

As Vought walked up to its 2010 Texas commitment, the firm sought bidders.  Carlyle courted Triumph in late 2009 and early 2010.  Were any calls made to the Governor's office?  Dealmakers like clarity.  The Carlyle Group announced it would sell Vought to Triumph Group in March 2010.
 
For the privilege of holding $35 million for six years, Vought returned $900,000 to Texas taxpayers, under a Perry renegotiated deal.  That's TexExecutive privilege.  Make no mistake, Carlyle Group principals have the chops to refund Texans the full $35 million plus interest.  The Legislature is fully funding the Governor's corporate slush pile, while not conducting oversight.

Yet, draconian cuts must be made elsewhere, due to a structural tax deficit Perry wishes to to make permanent:

The governor is committed to keeping taxes low in order to help small businesses continue to succeed and create jobs, and reiterated the need to make permanent the small business tax cut that was passed last session. This measure cut taxes for 40,000 small businesses, and allowed them to focus on job creation and growing their businesses.

Governor Perry is a man ahead of his time.  It took the City of San Angelo until 2011 to give millions in tax breaks for job retention.  While Perry's TEF Fund stays full throttle, citizens struggle mightily. TEF is anything but "wide open," transparency wise.  It's a black hole.

Update 4-4-11:  While children in wheelchairs testified on the harm of proposed cuts, Perry's personal Texas Enterprise Fund handed out  $2.45 million to a Cisco-EMC joint venture and $2.1 million to GGNSC Holdings.  Both grants are to fund corporate headquarters.

Update 5-2-11:  The Senate budget does not fund the Texas Enterprise Fund or the Emerging Technology Fund.  Watch for reconciliation.

ASU May Hack Instructors

An internal e-mail outlined ASU's efforts to reduce expenses in light of looming budget cuts.  One strategy involves eliminating a number of instructor, senior instructor and lecturer positions.  Instructors and lecturers are lower cost teaching professionals, a sort of professorial extender.  Another move would combine colleges and departments.  A rumor has the College of Liberal & Fine Arts combining with the College of Sciences. 

It may be difficult for ASU to reach its goal of 10,000 students without instructors/lecturers.  Senior leaders believe they can overload online classes (with up to 80 students per class).  Also, ASU may try to hire back lecturers as adjuncts, paying a fee per course, with no job benefits, like retirement or health insurance.

Health care providers chose to host a press conference on proposed budget cuts, using their web sites to mobilize support.  SAISD asked people to go to Kenny Blanek's Restaurant April 2nd at 2:00 pm in a teacher sponsored Day of Action.  ASU is yet to make a public call for action. 

Facing 25 to 33% state budget cuts, the cleaver is bound to hit tendon and bone across the Concho Valley. How hobbled will ASU be in the fall?  How much blood will obscure Vision 2012, much less Vision 2020?

ASU's potential job cuts portend greater pain for area health care providers.  How many hundreds will lose ASU's health insurance, like the City of San Angelo's nearly 200 people and SAISD's fifty four plus.  The area's legions of uninsureds continue to explode in number.  Let's hope it's not in anger.

Update:  Cuts to federal Pell Grants will add to ASU's misery. In Fall 2010 45% of ASU students received Pell Grants, up from 33% in 2008-09 .  Almost 92% of ASU students receive some form of financial aid.  College students, who don't drop out, will need to take out loans to make up for dwindling state and federal grants.  ASU's laying low may pay off, as Rep. Drew Darby filed an amendment giving the university $500,000 over a two year period.

Update 4-2-11:  ASU's Fall 2011 Schedule shows many classes with double the number of students vs. Spring 2011.  Education class sizes ranged from 10 to 26 in Spring.  They're 50 come August.  Many online classes have double the number of students, a distinct challenge for professors new to online teaching.  Students face a nearly 10% tuition increase and could receive half the level of service.  Who'll study the value equation?  The Business College is in a five year decline, falling from 1,100 students in 2006 to 774 in 2010, a nearly 30% decline.  That would make a great case study, as would Texas' "Great Budget ExPerryment.".

San Angelo Hospitals Lead Advocacy on Medicaid Cuts

Shannon CEO Bryan Horner and Community CEO Brad Holland held a press conference on state budget cuts on the steps of the Tom Green County Courthouse.  They chronicled dire cuts that could cost thousands of jobs in the health and human services sector, responsible for 21% of  Tom Green County employment. This compares to 13% in other Texas counties.

Medicaid insures low income Americans, with the federal government historically picking up 60% of the bill and states 40%.  That changed under the Stimulus Bill, as the feds share rose to 78%.  The extra federal portion ends later this year.  This expiration contributes greatly to Texas' Medicaid shortfall.

The potential pain is great for 220 local heath and human service providers, employing up to 7,500 people.  The impact on Tom Green County includes::

-Risk of budget cuts of 35%

-Potential loss of 2,000 jobs

-Ripple impact costing another 1.000-1,500 jobs

-MHMR faces a cut of 45%

-Nursing homes, indigent care clinics and hospice programs could set cuts of 35%

Supporting Bryan and Brad were Lynn Rutland of MHMR, Mike Campbell of Esperanza Clinic, Eric Sanchez of ADAC and Wes Wells of Baptist Memorial.  Several City Council members were in attendance, Paul Alexander and Dwayne Morrison.  The City of San Angelo added to local hospital misery with their health insurance adjustments, which shed nearly 200 people from city sponsored health coverage.

Brad Holland cited increased local taxes and higher health insurance rates as a result of budget cuts in HB1.  I think it will be the later.  Local taxing authorities are the City of San Angelo, SAISD and Tom Green County.  The City has virtually no public health services left other than immunizations and an STD clinic.  City Council refused to raise taxes to cover longtime health insurance commitments to retired workers.  Instead, it passed increased cost onto workers and fixed income retirees.  Of the nearly two hundred dropping coverage, roughly 45 were employees/retirees and 147 dependents.

SAISD will eliminate 52 positions, formerly providing health insurance coverage.  They plan to decrease health insurance benefits in their basic plan by dropping pharmacy coverage.  SAISD is looking at increased premium sharing for employees, like the City of San Angelo.  The first two taxing entities have chosen to pass increased health care costs to employees, not to raise taxes.

Tom Green County is the only taxing authority providing health coverage for extremely low income residents.  It does so via the Indigent Healthcare Program.  The County sets aside 8% of its general tax levy, or over $2 million, for Indigent Health.  Last year it spent $69,400.  The County Indigent Health budget for 2011 is $458,579.  

Tom Green County contributes $1 million per year to the Upper Payment Limit (UPL) Program, which leverages state and federal Medicaid money.  County Commissioners front loaded this year's contribution of $800,000 to avoid expected UPL cuts.  The match is 3.55 federal/state dollars for every local dollar. 

Last fall I asked Judge Mike Brown to consider raising the income level to qualify for Indigent Health from 21% of federal poverty level.  He told me by phone that other counties have been slammed for taking such action.

Including UPL payments the county spent roughly half of the Indigent Health budget in 2010, with plans to spend about 75% in the current fiscal year.  The County successfully shifted budget responsibility for indigent care to the state/federal government, turning the program into a decade long cash cow. 

I don't see any local taxing authority raising taxes to make up for the state's disastrous cuts.  Citizens will pay through higher health insurance rates for ever-worsening coverage.  Access to health care will be restricted as hospitals and clinics cut services.   Those without insurance and a $100 cash deposit will traipse to area Emergency Rooms.  

Hospitals will have difficulty transferring patients to a nursing home, due to nursing home closures or reduced services.  Discharge planners should go wig shopping now.  After wigs return en masse, how long before leeches make a comeback?

Press Conference on Texas Medicaid Cuts

Tom Green County health care providers will hold a press conference tomorrow at noon on the Courthouse steps.

The Health and Human Services Sector in Tom Green County is facing $92 million in cuts in the next budget year if the proposed TX Medicaid funding cuts are passed. The substantial cuts could result in a possible loss of 2,000 jobs in Health and Human Services alone in TGC, and another 1,000 jobs as a trickle-down effect. The Health and Human Services sector is the largest employment provider in TGC.

The $92 million cut for Tom Green County is down from a projected $116 million.  The House Appropriations Committee restored partial funding for caseload.  Medicaid cuts rise to $121 million for the Concho Valley (including Runnels County).  That's a 23% budget cut for providers.

Texas City felt the direct experience from BP's cutting maintenance expenses 25% in 2001.  The Texas City Refinery exploded in 2005, killing fifteen people.  

Last Wednesday I had jury duty in the County Courthouse.  It was interrupted by a bomb threat.  A different kind of bomb will be dropped on our community should draconian budget cuts go through.  It's a Daisy Cutter for health related jobs.

Unaccountable Fran and Business Opportunity

White House Homeland Security Adviser Frances Townsend revealed her assessment of Libyan strongman Colonel Gadhafi.  She based it on her visit with Gadhafi at his Tripoli compound:

"It's all about thuggery there," said Townsend

So Fran knew this as a member of the Bush White House?  Courting the Libyan thug:

Carlyle Group co-founder David Rubenstein traveled to Libya in 2006.

Homeland Security Adviser Frances Townsend visited Gadhafi in the summer of 2007

Saif Gadhafi flew to New York in 2007 to meet with Frank Carlucci

The Bush administration put a full court press on Gadhafi's son Saif in 2008

The Carlyle Group hosted a dinner in Saif's honor during the 2008 visit  with James A. Baker, III and Frank Carlucci in attendance.

The Carlyle Group was one of the first to receive money from the Libyan Investment Authority, established in 2006.

Why did they allow the Libyan Investment Authority to invest in Carlyle Group funds if the Bush White House knew Gadhafi was a thug?  Instead, these people legitimized Gadhafi in the world community.

David Rubenstein and fellow PEU Stephen Schwarzman flew to Tripoli for the wedding of LIA's Deputy Chief Executive in 2009.

Senator John McCain tweeted from the Gahdafi Ranch in 2009

Townsend advised Presidents George W. Bush and Barack Obama as a member of the Presidential Intelligence Advisory Board.  Did Fran forget Gadhafi was a thug between her 2007 visit and her 2008 appointment to the PIAB?

Fran danced with The Carlyle Group before Libya.  Five years ago Townsend omitted a Carlyle affiliate from her hapless Hurricane Katrina Lessons Learned report.  LifeCare Hospitals lost 25 patients in Katrina's horrific aftermath.  LifeCare had a Long Term Acute Care Unit inside Memorial Medical Center, which also got no mention.  Between the two corporate entities, 35 people died.  Oddly, a year after Fran's Katrina whitewash was foisted on the public, Jeb Bush landed a spot on Tenet Healthcare's board of directors.  Tenet owned Memorial Medical Center when Katrina struck.

After leaving the White House Frances Townsend consulted on risk management and government investigations for Baker Botts, James A. Baker, III's law firm.  Baker helped host Saif Gadhafi's 2008 visit.  Frances also was appointed Senior Advisor at Monument Capital, where Carlyle's Baker, Frank Carlucci and Mac McLarty serve on Monument's advisory board, known for being "hand's on.".   Fran is now Senior Vice President for Worldwide Government, Legal and Business Affairs at MacAndrews & Forbes.

Consider two Fran Townsend quotes:

"Any commercial or economic crisis creates business opportunity."

Overall, Townsend called it "an absolutely bizarre experience ... like a bad movie."

I couldn't agree more What's she spinning now and for whom?

Update 3-28-11:  President Obama ignores history as well in his speech to the nation.  "For more than four decades, the Libyan people have been ruled by a tyrant -– Muammar Qaddafi.  He has denied his people freedom, exploited their wealth, murdered opponents at home and abroad, and terrorized innocent people around the world –- including Americans who were killed by Libyan agents."  So why did Presidents Bush and Obama reach out to Gadhafi?

Update 7-1-11:  The media continues offering small fries as sacrificial lambs in the West's efforts to open up Libya.  The big boys skate under the radar.

Update 8-27-11:  Fran retold her story on CNN with the fall of Gadhafi.

SAISD Cuts to Decrease Health Insurance

With state budget cuts as high as $6 million per year, the San Angelo Independent School District (SAISD) eliminated 54 positions, 25 via retirement and 29 did not have their contracts renewed.  SAISD will likely cut the health insurance benefit by eliminating pharmacy coverage.  Employees will need to pay a portion of the premium to retain their current coverage.  It's not clear how much.  The Standard Times reported:

"When you don't give a person a salary increase or like last year, 1 percent, and you increase health insurance costs, it is a pay cut."--Superintendent Carol Ann Bonds

The 29 employees losing their job will also lose health care coverage.   How many more will drop coverage under increased premium sharing?  The City of San Angelo drove 192 people from the rolls undertaking such a strategy.

In Year 2 of the crisis, SAISD likely will "get out of the health insurance business."  That's a year before PPACA brings any significant relief to people without health coverage.  The problem is PPACA expands Medicaid by 15 million people.  The Texas Legislature is in the process of gutting Medicaid.  What will be left by 2014?  How tattered will the flag get under "Texas' Great ExPerryment?"

Update 3-31-11:  SAISD will sell land on Knickerbocker Road for $1.9 million.  Government asset sales are one method for funding deficits. 

When "Fail Safes" Fail

Japan's nuclear plant has a suspected #3 reactor breach, meaning all "fail safe" systems failed.  The Fukushima Daiichi nuclear plant was not designed to take a 9.0 earthquake, followed by a 23 foot tsunami.  The first containment system failure at reactor #3 occurred on March 14.  A hydrogen explosion tore through its containment building.

Last summer the Deepwater Horizon drilling rig exploded in a huge fireball after all "fail safe" systems failed.  A report suggests blowout preventers are anything but fail safe as currently designed.  When "fail safes" fail, look for the "U word,."  Unprecedented covers human failures well.

Update 3-31-11:  Radioactive contamination was found in groundwater nearly 50 feet under one of six reactors.  It measured at 10,000 times the government standard for water at the plant. This is the first time TEPCO released statistics for groundwater near the plant.

Update 4-17-11:  When fail safes fail, authorities say "trust us."   Take North Pacific fisheries.  No sampling or monitoring of fish is necessary.  Do fish migrate?  NOAA calls tuna a highly migratory species.

Great Texas ExPerryment: No Debate, Discussion or Amendments

The House Appropriations Committee approved a bone crushing budget that decimates public education and health/human services over the next two years.  The plan passed on party lines with no discussion or debate.  Representative Drew Darby sits on the Appropriations Committee.  Darby's staff weighed in via e-mail:

Appropriations Committee members have until Monday to file amendments to HB1. Trent Thomas, chief of staff for San Angelo's state Rep. Drew Darby, who serves on the committee and chairs one of its subcommittees, said in an e-mail that Darby doesn't plan to file any amendments "at this time."

The last time I saw Rep. Darby he remarked the budget had "nearly all his constituents mad at him."  His defense, "No one wants to pay more taxes,"  was challenged by an ASU professor.  Her "I will" negated Darby's assertion.

The Standard Times reported:

The House plan reduces reimbursement rates to nursing homes and other Medicaid providers, a change that could jeopardize 45,000 residents in the state's 550 nursing homes that depend on Medicaid, experts said.

The Medicaid reimbursement rate cut is only a quarter of the hit providers will take.  Over half of the funding loss is due to the federal government no longer picking up a greater share.  Under stimulus spending the federal share rose from 60% to 78%, but it's reverting back to the 60% level.  Texas legislators complain about this "cost shift."

Nursing home advocates say the true cut to nursing homes is closer to 33 percent because of recent changes in the federal-state funding formula.

Many nursing homes stated they will need to cut services, even close.  Area hospitals will need to cut staff and services, while continuing to shift Medicaid related costs to other payors.

Other groups walking away from health care coverage include the City of San Angelo, which dropped nearly 200 insureds January 1.  SAISD will eliminate 75 positions over a two year period, jobs that formerly provided health care coverage.  The school system plans to pass a greater share of the premium to employees, like the City recently did.  How many SAISD employees and dependents will lose coverage?

With nursing homes closed and up for sale, area hospitals will have difficulty transferring patients.  Sick patients could stack up in hospitals, with fewer sub-acute care resources in the area.

Hospitals will lose more money per Medicaid patient, the "cost shift" Texas legislators avoid discussing.  Physician practices could restrict access for Medicaid patients, leaving Esperanza Clinic and area emergency rooms as their avenue for treatment.  Esperanza is yet to share the impact of Medicaid cuts, but Shannon and Community could together lose over $25 million in funding.

With crisis comes opportunity.  Nursing home closures could provide The Carlyle Group, a frequent benefactor of Governor Perry's largess, an opportunity to purchase nursing homes at fire sale prices.  While it might not be part of a plan, it could benefit the super rich, who have the chops to ensure "no new taxes."

We'll know how the "Great Texas ExPerryment" worked in three years.  My prediction is lots of pain, physical and economic.  How will the silent "yes voting" legislators pay for their draconian cuts to health care and education?  That remains to be seen.

Tom Green County Courthouse Evacuated

Security personnel evacuated the Tom Green County Courthouse at roughly 11:00 am.  When potential jurors left the grounds, nary a police car was in sight.  When jurors checked back at noon, as instructed, they found San Angelo police officers.  Jurors were instructed to return at 1:00 pm.

Public buildings can be evacuated for safety reasons, fire alarms, bomb threats and terror threats.  It's not clear which reason caused today's evacuation.

Update:  Standard Times cited the cause, bomb threat.  After a bomb sniffing dog cleared the building, jury selection restarted at 2:00 pm.  Judge Weatherby said the probation office in the basement received the threatening call.

SAISD to Contribute to San Angelo's Uninsureds

San Angelo Independent School District cut 30 positions in this year's budget and plans to drop 45 more.  That's 75 positions that once provided health insurance.  In addition, SAISD employees will have to contribute more to the district's self-funded health insurance program. 

The City of San Angelo sent 192 people onto the rolls of the uninsured with their premium changes.  How many SAISD employees will drop individual or family coverage as a result of premium increases or eliminated positions?  It remains to be seen.

San Angelo's City Council added another burden to employees and dependents who dropped health coverage due to inaffordability.  They increased the deposit to be seen at the Employee Health Clinic from $10 to $65.  Nearly 200 more uninsured employees and dependents will have to pony up $55 more per visit for primary care. 

President Obama's Business in Brazil

USA Today reported:

Obama also offered U.S. help on infrastructure needed to bolster the host country's two major upcoming projects: the 2014 World Cup, to be conducted across the country, and the 2016 Summer Olympics, to be centered in Rio.

As usual the President pushed American branded global corporations.

Executives from a number of American corporations, including International Paper, Cargill, Citigroup and Coca-Cola, participated in the CEO session.

No word on whether Peter Orszag made the trip.  Citigroup hired Orszag as Vice Chair of Global Banking. What kind of infrastructure will the U.S. help Brazil develop?  Maybe a berth at a Brazilian port for Utopia, an ultra luxury cruise ship.  The Utopia plans to take in Carnival, the Olympics and maybe the World Cup.  Carlyle's Chairman Emeritus Frank Carlucci is both a Utopia investor and luxury resident owner.

Carlyle Group already invested some of $1.5 billion slated for Brazil.  Carlyle purchased a majority stake in CVC, Latin America's largest tour operator. The 2014 World Cup and 2016 Summer Olympics should provide major demand for CVC.  Carlyle also purchased a Brazilian health insurer, lingerie maker, and is interested in other Brazilian hot properties. 

Carlyle co-founder David Rubenstein knew how to garner President Obama's stimulus funding.  Will he do likewise with Brazilian infrastructure money?  I detect stimulation and corporafornication. 

News reports had President Obama calling Brazil a "model of democracy."  In America corporations have the same free speech rights as citizens.

"It was an historic speech," said Eduardo Eugenio Gouvea Viera, who represents FIRJAN, Brazil's leading industry federation.

"The message he gave was that the most worthy value to Brazilians and Americans is freedom," Viera told Brazil's official Agencia Brasil.

CNN stated:

A group of protesters were barred from holding an anti-American and anti-Guantanamo rally, Brazil's official news agency reported.

Brazil may be a quick study.

Texas Revenue Streams Up for Sale?

Senator Robert Duncan will chair the Subcommittee on Fiscal Matters, charged with finding $5 billion of nontax revenue to help balance Texas' multibillion-dollar budget shortfall.  Duncan said:

"We're not looking for new taxes. If you look at the budget, you'll see there are a lot of revenue streams in the budget that are not used efficiently or for the purpose that they were originally created for, and so you don't' have to raise taxes or increase fees," he said.

Inefficient revenue streams are usually eliminated.  However, Texas badly needs revenue. Does "inefficient" mean "sold or leased to the private sector."  Toll roads, parking, ports, the Texas Lottery and even water could be up on the sale/lease block.  Billions in infrastructure funds stand ready and waiting for public-private partnerships (P3).  Uncle Sam stands ready and willing to lever them.  The question is how cheap they will go and what monopoly protections might the state or feds provide?

Texas is in the P3 crosshairs.

US P3 Key Market Watch: Texas

Two storied Texas law firms have experience with P3's, BakerBotts and Vincent & Elkins.  I expect their business to boom after this legislative session.

It will be interesting to hear what Senator Duncan's committee finds.  I know where they can find $7 million plus interest over the coming biennium.  The state could hold Vought Aircraft Industries to their original Texas Enterprise Fund commitment.  Perry doesn't have to answer for changing the deal.  Why am I not surprised?

Update 3-20-11:  Traffic cameras could be in Texas' revenue generating future.

Update 3-30-11:  So could gambling.

Update 4-1-11:   The setup for toll roads.

Ezra Missed the Bayh Sign

WaPo's Ezra Klein was crestfallen by Senator Evan Bayh's post-retirement decisions.  Why would Ezra believe Evan's retirement schmaltz, like working for a university, charity or helping grow jobs?  Instead, Evan took batting practice in the major leagues.  It took little time for Bayh to sharpen his skills.

Evan Bayh smacked three straight out of Coporafornication Park.  He advises Apollo Global Management-a private equity underwriter (PEU) ready to go public.  McGuire Woods hired Bayh to serve national and international corporate clients and Fox News employed Evan for commentary.

"I'm pleased to offer analysis of public policy and politics to the millions of Americans who get their news from Fox."

Evan Bayh had a clear track record in the Senate, backing private equity and sovereign wealth funds.  PEU's crashed the Forbes richest list in 2007.  Bayh's lifetime donor list includes The Carlyle Group, once as high as #3.  Carlyle had a remarkable run during Evan's public service. 

Knowledge is prediction.  PEUReport wrote last year:

Political officials know PEGCC well. Their best friends are PEU's and many hope for high paying employment after public service. Watch where Peter Orszag, Evan Bayh and Chris Dodd land..

Like Tom Daschle and others before him, Bayh landed at Apollo.  

Let's revisit Bayh's retirement contemplation, i.e. where he planned to spend time by::

"creating jobs by helping grow a business, helping guide an institution of higher learning, or helping run a worthy charitable endeavor."

Evan Bayh went "0 for 3" on those.  He didn't retire, Evan monetized his brand in the global capital ecosystem.  McGuire Woods cited Bayh's role as:

Strategic advisor to many of the firm's most significant clients, particularly those whose business goals are impacted by the actions of Congress, the executive branch, or by governors and legislators across the country.

Bayh is a franchisee for "Oligarchs R Us," but then again that was much of his Senate service.  Evan started early with his vote for Gramm-Leach-Bliley.  In between he carried water for PEU's, SWF's and for-profit health insurers.  He contemplated a Presidential run in 2006, which lasted but weeks.  Most recently, health reform sent millions in taxpayer dollars to pharmaceutical companies with wife Susan on the board of directors.

Update 3-21-11:  Bayh's Apollo Global Management reached a $125 million settlement with CalPERS regarding future management fee discounts.  This came as a result of an investigation into placement agents and pension fund operations.

Apollo has agreed to reduce its management and other fees on funds it manages solely for CalPERS by $125 million over the course of the next five years, or as close a period as required to provide CalPERS with that benefit, and may include both existing and new investments that Apollo manages solely for CaIPERS.

Update 3-26-11:  Apollo Global Management had assets of $57.8 billion as of Sept. 30, 2010.  By December 31, 2010 the number had grown to $67.6 billion.  Forty six Apollo subsidiaries are based in The Cayman Islands.  Bayh jumped on a money cruise ship, just as it approaches port in George Town.

Update 1-29-14:  Ezra will join Vox to offer his new blog.  I suggest it be called Wankerblog.

Texas Budget: "The Great ExPerryment"

The Texas Legislature and Governor Rick Perry stared down state programs.  Rick's six shooter wasn't filled with blanks, but hollow points capable of obliterating funds for current services, as much as 30%.  The gang headed for the Concho Valley, where most anything's a target.

Perry spied a Medicaid cost shift on San Angelo's Main Street.  Blam!  Health & Human Services took a hit of $206 million.  The Governor shouted, "Take that Feds," but the dastardly cost shift didn't disappear.  It grew exponentially for hospitals, physicians nursing homes and community based care programs.   They'll need to gouge other payors to make up Medicaid's shortfall.

But Perry's Gang warn't close to done. Education's got to git leaner.  Blam!  The legislature gang shot a $50 million hole in the budget for school districts, Howard College and Angelo State University. 

Dang if the gang didn't run across a probationer.  Blam!  The frightened man scampered back toward the jail house.  Perry bragged, "That'll git his sorry behind back to where it belongs."  The gang guffawed for their leader.

Perry shouted to the growing crowd, "Y'all got any folks not in their right mind?"  A local replied, "They might be hiding, what with all the ruckus."  One of Perry's boys cold cocked the man.  A boy ran to the fallen man's aid, saying only one word to his stunned father, "Jackasses."

The gang rode hard in a circle, stirring up a mighty dust.  Their pistols shot a $260 million hole in the Concho Valley's already leaking economy.  Rick took a big draw from his whiskey bottle, then hooted loudly.  "Welcome to the Great ExPerryment!  Let's ride, boys."  They headed east toward Austin, away from the mess they'd made..

The Concho Valley will know how it worked after its done.  Want to bet the perpetrators will be long gone?  When the jury's ready to judge his work, Governor Perry may well have taken the coach to Washington, D.C.

Update 3-18-11:  Tom Green County could lose $1.5 million in funding for various programs.   Add $1 million for surrounding county governments and the "take away" reaches $262.5 million.

Update 3-22-11:  SACMC CEO Brad Holland and Esperanza CEO Mike Campbell asked City Council to pass a resolution opposing drastic health care cuts.  The City expressed interest in rewording the resolution to include Angelo State University and SAISD.

Update 8-20-11:  The Standard Times reported Texas is losing its grip on jobs as the new state budget year approaches.  "The 9,400 government jobs lost last month was the sharpest monthly drop since September, with Central Texas taking the brunt of those losses."

Dr. Preston Darby's Final Trip

Dr. Preston Darby passed away peacefully with family this morning, after a long battle with Lou Gehrig's disease.  His body suffered the ravages of  ALS and eventually, the toll wore on his spirit.  To friends Pres remained a gracious, Southern gentlemen, with a penchant for storytelling. My last visit with Pres was alongside Dr. Ralph Chase.  The combination left me with a general ache in the midsection.  It came from the best medicine, laughter.

Over the years Pres regaled me with stories of rural South Carolina, his writing class with Elmer Kelton, antics at Community Health Club and doctoring in Afghanistan.  He spoke of his writing, often referring to his "God awful" short stories and first novel. Pres' books include Tears of the Oppressed, which chronicled his medical mission work in Afghanistan during Soviet Occupation.  The Reluctant Assassin showed John Wilkes Booth surviving his injuries and subsequent adventures as a world traveler.  After assassinating President Lincoln, Booth meets a host of notable characters in this lark of a story. 

Close friend and fellow author Ken Casper helped Pres revive his moribund first novel.  Together they worked, week in and week out.  The result is ManKillers.  It's a tale of love and loss in the post Civil War South.  It was published in December of 2010.

Notable character, loved by many?  That's Pres Darby.  San Angelo lost another treasure.  My thoughts and prayers are with Pam and the family.

I see Darby whole in heaven, catching up with loved ones.  After an appropriate period of reuniting, I bet Pres says "Pardon my intrusion, but where do you keep the pen and paper?"  After securing such, I see Pres running barefoot on the clouds.  It's a record time...

Update 3-15-11:  The Standard Times highlighted Dr. Darby's life in story and obituary.

Update 3-19-11:  Emmanuel Episcopal Church overflowed with love today.  Hundreds turned out to remember Pres Darby's unique character and vitality.  After hearing Pam and family members speak, I realize it'd be awhile before Pres asked God about the pen and paper.  He and Steven have much catching up to do.

Adding ASU & Howard College

Proposed budget cuts by the Texas legislature total $244 million for the Concho Valley (plus Runnels County).  An additional $15 million will come out of the hide of Howard College and Angelo State University.

HHS-- $206 million
Public Education--$23 million
Higher Education--$15 million

Cuts are from 2010-2011 state budget spending.  Higher education cuts add to Tom Green County's misery, making the total now $207 million or $1,907 per citizen.:  

 
Scroll down for posts with HHS and Public Education cuts by county.  The big picture should be seen.

Update 3-14-11:  SAISD said cuts will be between $9 and $12 million per year.  This is much higher than CPPP's estimate of $7 million for Tom Green County.  It adds $11 to $17 million to the Concho Valley total, now $255 to $261 million for the biennium.   That's a quarter of a billion for mostly rural Central West Texas.

Texas Budget Train Cutting through Concho Valley

Concho Valley counties will see an average $830 hit per person under proposed Texas budget cuts.  The cuts are relative to state funds expended in 2010-2011  The breakdown by county is:

(Clicking on the graph will enlarge the image for better viewing.)

One might expect the Concho Valley Council of Governments to weigh in on the issue.  An economic hit of $230 million warrants comment, especially from an organization charged with regional economic development.  So far, CVCOG has been publicly silent.  That doesn't mean they aren't working behind closed doors on behalf of stressed local school systems and ailing hospital districts.  The question is how they plan to help.

Update 4:05 pm:  SAISD announced it would eliminate teacher positions through attrition and not renewing poor performers.  It didn't say how many teacher positions would be eliminated to achieve budget savings of over 10%..  How many losing work will also lose health insurance for their families, layering stress on Shannon Medical Center?  Shannon already faces cuts in Medicaid, CHIP and UPL Program payments.  As the Concho Valley's safety net hospital, it sees 80% of the uninsured.  How many people will SAISD add to the nearly 200 newly uninsured from the City of San Angelo?  It bears watching.

Update 4:55 pm:  Kiah Collier stated 45 teacher positions would be eliminated, 25 via retirement and 20 through non-renewals.  How many other district positions will disappear?  How many people will lose health insurance as a result?

Legislative Budget Cuts Loom for Concho Valley

Texas legislators consider deep cuts to health and public education.  The one-two $230 million punch could create more hardship for Concho Valley communities.  This analysis includes Runnels County, which is served by Shannon Medical Center and San Angelo Community Medical Center.  The county breakdown follows, starting with those with cuts between $7 million and $3 million:.

Counties with cuts less than $2.5 million include:

Tom Green County will take the biggest hit, a combined $192 million:

This does not include budget cuts to Angelo State University or Howard College.  Nor does it cover potential Upper Payment Limit Program cuts to area hospitals.  As state funded positions are eliminated, how many people will lose health insurance coverage, potentially qualifying for slashed Medicaid?  As cuts feedback on each other, pain will spread.  That's predictable.

HHS Cuts Projected at $206 Million for Concho Valley

“There is still a lot of concern about what the base budget does, the cuts, and where those cuts are being made and I think we’re still trying to find some additional savings,” said Rep. Drew Darby, R-San Angelo.

Projected savings for Health & Human Services are $206 million for the Concho Valley, plus Runnels County.  Tom Green County, slated to lose $185 million, comprises most of the cuts. Over $330 million is needed to maintain current services, of which the federal government would pay 60%. 

The most common cut for surrounding counties is in the $1 million range, however Runnels ($6 million) and McCulloch ($3.7 million) stand to lose much more.  .

The $206 million in Concho Valley cuts represents 30% of 2010-2011 budget.  Coke, Concho, Crockett and Sterling Counties could see over a 33% cut in HHS spending in their communities.

Major HHS Programs include Medicaid Acute Care and nursing home funding, community care, public health and consumer protection programs, child & adult protective services, foster care/adoption, day care regulation, Early Childhood Intervention, vocational rehabilitation, and federal disability determination.

How does the job decimator multiply $206 million in lost funds?  It remains to be seen.

Medicaid Cuts for Tom Green County & Concho Valley

The Center for Public Policy Priorities published county-by-county estimates showing the impact of proposed Medicaid cuts.  The negative impact on Tom Green County hospitals, doctors and nursing homes is nearly $116 million.  Over half of that amount, $64 million, comes from the loss of federal stimulus money.  CPPP's data does not include Medicaid UPL funds, currently distributed to Shannon Medical Center and San Angelo Community Medical Center.  Cuts could be closer to $120 million.

Area providers, especially doctors and hospitals, serve people outside Tom Green County.  The following graph shows the impact of $152 million in Medicaid cuts on the Concho Valley and Runnels County.

How will a $152 million revenue loss wash through area hospitals, clinics and nursing homes? The job decimator, the opposite of the job multiplier, may be coming to the Concho Valley's health sector.

Will Shannon or Community ask the City of San Angelo for job maintenance funding, like Ethicon?  They'd have the right to, given the City's driving nearly 200 people from the health insurance rolls.

Update:  On March 1 City Council entered executive session "to discuss an offer of financial or other incentive to a company or companies with whom the City of San Angelo is conducting economic development negotiations and which the City of San Angelo seeks to have, locate, stay or expand in San Angelo."

Update 3-27-11:   SAST reported the Legislative Budget Board released an analysis showing the state could lose 271,746 jobs in 2012 and 335,244 jobs in 2013 if the House budget goes through as is.

Tom Green County's Indigent Health Fractal

Tom Green County spent $7.5 million less than the 8% general tax levy for Indigent Healthcare in the last decade.  In 1999 the county spent $1.96 million, needing assistance from the state.  The Indigent Health budget for 2011 is $458,579.  Contrast this $1.5 million decline with unrelenting increases in health insurance premiums.

The County does contribute $1 million, technically not part of Indigent Health, to Medicaid's UPL Payment Program.  Giving the County credit for this contribution raises the 2011 total to $1.46 million, still far below the 8% requirement of $2.01 million.  By the end of this fiscal year the Indigent Healthcare surplus could exceed $8 million.  What happens to these funds?  The County outlined their use in a recent document:

SURPLUS FUNDS - funds not expended during a budget year. Shall be maintained and accounted for using generally accepted accounting principles. May be used to increase yields to defer taxes.

The County pattern repeats elsewhere in fractal form.  The City of San Angelo took a similar line, deferring tax increases to fund retiree health insurance promises.  City Council increased premiums as high as 34 to 58% for retiree dependents.  As a result, 192 people dropped health insurance, 45 employees/retirees and 147 dependents.  The health insurance massacre occurred while the City participates in the fed's Early Retiree Reinsurance Program. 

Texas state legislators look to gut Medicaid and CHIP.  A recent report showed Medicaid paying hospitals 22% of charges for potentially preventable re-admissions.  How far below actual costs does Medicaid currently pay?  Under stressed state and federal budgets, UPL money must be at risk.  When that goes, virtually every healthcare funder, government and corporate, will be in retrenchment mode.. 

Chaos theory provides insight as to what may happen.  The system becomes increasingly unstable until it reaches a point of maximum instability, the bifurcation point, after which the system reorders at a new level.  Politically, this is occurring in the Middle East, where corrupt, heavy handed rulers hold billions in oil money and send business to close friends and associates.  Their people woke up and protested.  I don't expect Americans to do so anytime soon.

That leaves one question.  How might the slow motion collapse of health care financing express in San Angelo and Tom Green County?

A storm is coming.  Who will weather it?

Update 3-5-2011:  The Texas state legislature proposed a 10% cut in Medicaid funding.  Will Bishop Mike inform Lady Justice?  How long before she unleashes her sword on local and state officials?