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Board drops the corpus spending policy as staff project the fund will last to 2036
City staff told the Finance Committee and the Board that cash flow projections showed the corpus would cover the District's obligations through the end of the Indigent Care Agreement in 2036 with about $21 million left, and that the District would then need to levy a tax; the board would need to act in 2029 to set a property tax rate for indigent care. The board removed the spending policy from the corpus investment policy, hired Sage Investment Managers for the remaining Herring Bank funds (about $38 million), and approved a fiscal 2020/21 budget with line items for the District to fund Texas Tech pediatric subspecialties and Tobacco Free Amarillo again after Northwest Texas Healthcare System ended its funding of them.[1][2]
Laura StorrsSage Advisory Services (Sage Investment Managers)
What the sources say
- ✓ Verified
Staff projections presented in August 2020 showed enough corpus funds to meet all obligations until 2036 with approximately $21 million left. These are projections, not results. [1][2]
- Projected 2036 reserve
- $21,000,000
- ✓ Verified
The Finance Committee minutes record staff saying the board would need to take action in 2029 to set a property tax rate to fund indigent care and begin, in 2031, the request-for-proposals process for a new indigent care contract; the Deputy City Attorney said legislation to reinstitute an indigent tax would likely take at least three legislative sessions. [1]
- ✓ Verified
Staff said the original plan assumed the District could earn 7% and spend less than 0.75% of the corpus each year, but the fund had not always achieved 7%; the Finance Committee (3-0) and the Board (7-0) approved removing the expenditure policy from the corpus investment policy and adding that the Public Funds Investment Act prevails in a conflict. [1][2]
- ✓ Verified
The fiscal 2020/21 budget estimated $165.7 million available at the start of the year, revenues of $4.2 million and expenditures of $13.3 million, leaving $156.6 million. It passed 5-0-1, with one member abstaining because of employment by Texas Tech. [2]
- Budget expenditures
- $13,300,000
- ✓ Verified
Texas Tech's Department of Pediatrics told the board that NWTH had given notice it would end its pediatric subspecialty contract on September 30, 2020; the District had supported the program through NWTH since October 1, 2007 at $1.2 million a year, later $1.4 million. Texas Tech asked the District to fund the contract at $1,350,000. [1][2]
