Pending state budget cuts could hurt El Paso most
by Zahira Torres \ Austin Bureau
Posted: 01/09/2011 12:01:14 AM MST

AUSTIN -- Deep cuts to the state's budget will affect every Texan but may take a their greatest toll on El Paso and other border communities, according to politicians and political observers.

Texas faces a budget deficit, projected to reach up to $25 billion, which will be under heavy scrutiny when the Legislature returns to Austin this week.

Lawmakers are warning that even if they use the state's about $9.6 billion rainy-day fund and raise fees for services, they will still have to make cuts to programs that include health care and education.

And key lawmakers have ruled out tax increases as a way to solve the problem.

State Sen. Judith Zaffirini, D-Laredo, who is chairwoman of the higher education committee and sits on others that include health and human services and finance, said the budget cuts will be more severe if the state chooses not to seek new sources of revenue, such as legalizing casino gaming.

She said border lawmakers will have to be vigilant and persuasive to protect their communities from cuts that typically hurt those with the greatest need.

"We have more low-income families and families with more complex health problems, so any cuts in health and human services certainly will impact or could impact the border region dramatically," Zaffirini said.

Cal Jillson, a political science professor at Southern Methodist University, agreed.

He said such areas have higher numbers of residents benefiting from programs such as Medicaid, the Children's Health Insurance Program and financial aid programs for college students.

"The little that Texas provides in public service is provided to those with greatest need," Jillson said.

Those areas are also typically represented by Democrats at a time when Republican lawmakers, if they work as a unified bloc, can pass legislation without a single vote from the minority party, Jillson said.

"Generally, I think Republicans feel that they won their very large majority on Anglo votes and suburban votes, and those constituencies are not interested in tax increases to sustain Texas spending," he said.

El Paso County, with an estimated population of about 751,000, has nearly 144,000 people enrolled in Medicaid and about 24,000 in CHIP, according to state figures.

Two years ago, the state and federal government spent $728 million on Medicaid and $28 million on children's health insurance for the county.

Gov. Rick Perry is among 33 Republican governors who are pushing for a change to the federal health-care law that would give them the ability to cut people from Medicaid rolls without being financially penalized. If that happens, El Paso could see a decline in the number of its people eligible for Medicaid, officials said.

State lawmakers may also look at the possibility of cutting funding for adult Medicaid-covered services such as prescription drug coverage, hearing aids, dialysis, physical therapy and speech therapy.

Medicaid reimbursement rates for doctors and hospitals have already had a 1 percent decrease, and that will rise to 2 percent in February.

County Judge Veronica Escobar said she fears that the state's budget cuts will shift the burden for health-care services to local governments and eventually to taxpayers who are already struggling to make ends meet.

"What is incredibly frustrating is that you have some legislators -- not from our own delegation but from across the state -- who make huge promises about no new taxes and all they're doing is shifting their responsibility to their local property tax base in a different way through the burden they've placed on local government," Escobar said.

Among the concerns for Escobar is a proposed decrease in funding for the El Paso Mental Health Mental Retardation and cuts that will affect University Medical Center.

The Department of State Health Services has proposed an $80 million cut that could affect the state's 39 publicly supported community mental health centers.

Among the centers that could see cuts is El Paso Mental Health and Mental Retardation, which serves about 7,000 people. It is not clear how much of its $26 million in state money over a two-year period will be affected, but local leaders fear that a funding gap will crowd El Paso's jails with the mentally ill.

Six hospitals in El Paso County last year also received more than $2.7 million in state money for care given to uninsured patients who go to the emergency room with trauma injuries. University Medical Center received about 87 percent of that money.

The state provides nearly $150 million for uncompensated trauma care over a two-year period. The department has already scaled back funding by $5 million this year and has proposed a reduction of about $25 million over the next two years.

Education leaders in El Paso also have been sounding alarms.

Among their primary concerns is that state lawmakers may choose not to restore one-time federal stimulus money used to pay for school district and university operations.

The federal government provided $3.25 billion in stimulus money in 2009 for education to Texas. State lawmakers, though, reduced funding to school districts and universities by the same amount. That helped the Legislature balance its budget and avoid using its rainy-day fund for school expenses.

Lorenzo Garcia, superintendent of the El Paso Independent School District, has said his district could be $18 million in the hole if state funding is not restored. The University of Texas at El Paso would receive $8 million less, its administrators said.

And both public education and higher education institutions have been warned to prepare for further cutbacks.

UTEP President Diana Natalicio said she worries that if the Legislature significantly scales back funding, universities will have to seek additional revenue by raising tuition and fees.

"Our students cannot afford that, and that's where we differ dramatically from UT Dallas, where increasing tuition and fees is not a catastrophe," she said.

The cutbacks could also hinder UTEP's efforts to become a nationally recognized research institution, administrators said.

Public education makes up about 44 percent of the state's $87 billion general revenue budget.

EPISD officials said they have been told to prepare for a 5 percent budget cut, which could cost $22 million.

At the Socorro Independent School District, the cost would be about $14 million.

State Rep. Joe Pickett, D-El Paso, said that teachers groups, school districts, colleges and universities should come to the table with specific recommendations to help offset severe cuts.

"People say don't cut us," he said. "OK, who do we cut or how do we raise the money?"

Some suggestions have included lifting the cap on class sizes to increase the 22-to-1 student-to-teacher ratio in kindergarten through fourth grades, the elimination of unfunded mandates, pushing back the timetable for the implementation of end-of-year course exams, and eliminating extracurricular programs such as athletics.

Socorro Independent School District Superintendent Xavier De La Torre said the effects of reduced funding may not always be highly visible but affect student learning.

"What we're doing is we are jeopardizing our students' achievement by taking resources that we have typically invested in best practices and having to invest them in keeping up with utility costs increases, health cost increases, in insulating our community from increased tax rates," he said.

Bill Studer, deputy city manager of finance and management support services for El Paso, said city government mostly receives grant revenue from the state and, while it would like to keep that money, most services would not be dramatically affected.

Studer said the state could hurt city finances if it restricts the city's ability to raise property taxes or if it discontinues grants but requires the city to continue offering services in areas such as air-quality monitoring and crime-victim assistance programs.

He also said the city could eventually have to pick up the slack if Texas scales back money for state-maintained roads such as Montana, Alameda, Mesa, Dyer and Trans Mountain.

"There is more risk than there is in a typical year of impact to the city, but because we generate the vast majority of our operating revenues on our own, we're not as subject to things that might happen at the state level as schools might be," he said.

Jillson, the political scientist, said there is some hope for communities. He said Republican lawmakers understand that any backlash from decisions made to cut services will be directed toward them.

"You can cut more deeply than even conservative Texans think is sensible," he said, "and Republicans need to keep that in mind."

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