An ordinance by Caddo Commissioner Ken Epperson that would have stripped public funding of the organization failed last week, falling four votes short of passage. By Oct. 1, the BRF becomes the administrator of both the Louisiana
State University Health Sciences Center – Shreveport and E.A. Conway Medical
Center in Monroe, including their clinics. The state is in the transition of finding
non-government operators for all but one of its state-owned charity hospitals
and while the others have been recommended to be managed by hospitals, the only entity that currently does not deliver in-patient health care tapped
to take over management of a state facility is the BRF, which never
has run any hospitals.
Its experience lies elsewhere. From its beginning, the 501(c)(3) tax entity was envisioned as instrument to provide facilities to small concerns in the area of biomedicine, where they could develop innovative products. Since then, it has expanded its purview to trying to attract any technology-related tenant to its portfolio of facilities worth $53 million and also has gotten into the providing of venture capital.
Its only direct provision of medical services has come from its Positron
Emission Tomography scanner; it also provides radiopharmaceutical products both
for clinical and research use through a subsidiary. It oversees facilities used
for research and also lets grants for research, congruent to the medical
education aspect of LSUHCS-S. But besides these activities, it has no
experience in running a hospital, teaching or otherwise. And that in its last
reported fiscal year (calendar
year 2011), it actually took a small loss on the PET scan and radiopharmaceutical
operations may not inspire confidence that it should operate much more extensive
and complicated facilities.
Especially when understanding the scope of the business conducted by
the two entities. Presently, those two hospitals have annual revenues of $655
million – about 52 times last year’s revenue for the BRF, meaning a huge
difference in scale in performance. Although of the partners lined up to assume
management of the nine hospitals, BMR has the most incestuous relationship with
state government – it already has leasing agreements with LSUHCS-S and the Department
of Economic Development that represent over a quarter of its revenues. And its Chief Executive Office, an unpaid position, John George sits on the LSU Board of Supervisors.
With this tremendous influx of revenues coming to the BRF, one might have thought this would obviate any need for the organization to draw upon the 1.74 mills of property tax
in Caddo Parish that began at a higher rate in 1997, which last reported year
transferred $2.5 million to it. This represented about a fifth of all BRF revenues
but begs the question why it should receive that money in the first place if it
has so much in assets, including more cash on hand than the annual tax subsidy,
and in that it, an entity that pays no income taxes and may receive tax-free
donations, competes in the provision of PET scan services and radiopharmaceutical
products with the private sector. The BRF claims it will continue to use the subsidy only on economic development projects.
In its latest
released annual report, the organization claims it houses tenants with $18
million in payroll for 350 employees. Assuming very likely incorrectly that all
otherwise would have relocated outside of the parish without the BMR and
assuming half of this payroll gets spent on local goods, paying sales taxes,
and half of them own homes in the parish worth $125,000, paying property taxes,
that otherwise would not be built, that’s still less than a million dollars a
year that they contribute to the coffers of Caddo Parish governments. It’s a
net loss to Caddo taxpayers and cannot justify any overblown claims about how
the economic development pays for itself.
No comments:
Post a Comment