GLEN ROSE – As the poker match that is Luminant Generation Company, LLC v Somervell County Central Appraisal District continues, Glen Rose Medical Center CEO Ray Reynolds has notified GRMC staff that his budget cut plans were no bluff.
In an open letter to employees issued Friday, June 24, Reynolds began by reestablishing the already well known facts of the case.
“As most of you are aware Luminant (Comanche Peak Nuclear Plant) has not fully paid its property taxes for 2015,” Reynolds informed. “In late January, we received a partial payment of $1,220,234 instead of the $2,346,500 we were expecting. From that amount received from Luminant in late January, we were required to make a bond payment of $629,931.”
As previously reported, the case went before the Honorable John E. Neill of the 18th District Court of Texas. Neill then ruled March 10 in favor of the SCAD and ordered Luminant to pay the “fair market value” of the Comanche Peak property. The valuation, as determined by Neill, was set at $2,221,721,055.00.
Luminant then, within its 30-day window, filed an official appeal June 1 with the Tenth Court of Appeals in Waco.
“Our goal from the outset has been to determine Comanche Peak’s taxable value for 2015,” Brad Watson, Senior Director of Corporate Communications for Luminant, previously told the Reporter. “We’re committed to pay our fair share and are pursuing the process set by state law available to any taxpayer.
“The recent court decision does not reflect the accurate value of Comanche Peak given the market conditions of low wholesale power prices in 2015 that have continued to fall by more than one-third in the past year.”
With an approximate $315,000 bond payment due in August, which Reynolds has already stated GRMC does not have the funds on hand to pay, the CEO informed the Reporter on May 26 of six cutbacks GRMC had already made.
According to Reynolds, those budget cuts included:
• Reducing the salary of administration by 10-20 percent
• Reducing many employees from 80 hours to 72 hours
• Canceling raises that were scheduled for June
• Citing attrition for the non-replacement of THREE former employees
• Discontinuing the reimbursement for travel – unless absolutely necessary
• Discontinuing the reimbursement for continued education for GRMC staff
However, the number of cuts has grown, according the Reynolds open letter. In the letter, which Somervell County Hospital Board President Ron Hankins said he advised Reynolds to write due to employees being “unsure of the situation,” Reynolds lists nine budgetary cuts that he informed the SCHD of during its June 9 meeting.
According to the letter and in line with the May 26th report, GRMC has:
- Eliminated pay raises for all employees
- Eliminated all travel, meeting and education expense reimbursement unless required for hospital licensure or accreditation
- Had administrative staff and department managers accept pay reductions of 10-20 percent
- Not filled the positions of FIVE employees who have resigned, and other employees have been asked to absorb those duties.
It should be noted that the number of employees who have resigned is already up from the three resignations reported less than one-month prior.
In addition, GRMC has also:
- Eliminated PTO reimbursement (sale back) that was scheduled for June
- Encouraged employees to take time off if volume low
- Eliminated two other positions
- Effective June 24, will no longer staff the Cardiopulmonary Department from 9 p.m. – 7 a.m., Monday through Friday and 11 p.m. – 7 a.m., Saturday and Sunday. Med-Surgical nurses will assume patient treatments during that time. Cardiopulmonary will be on-call for acute respiratory patient treatments.
- Effective in July, will eliminate night ER registration position. ER nurses and radiology will be responsible for registering night patients.
“We do not believe we will receive any additional tax payments from Luminant during the calendar year 2016 and probably will not receive full payment for 2015 taxes until 2018,” Reynolds stated. “[…] We will need to do more to further reduce expenses. Our goal is to reduce expenses by $125,000 per month.
“To date with the actions we have taken including the departure of Dr. [Pierre] Laughton, we are at a savings of $68,696 per month.”
Reynolds concluded by informing his staff that employee benefits will be an area to examine for further cuts. This comes after the “possibility of filing Chapter 9 bankruptcy” was discussed with the SCHD’s legal team, according to Hankins.
Chapter 9, Title 11 of the U.S. Bankruptcy Code is a tool that can be utilized by municipalities to reduce debt, according to uscourts.gov. Several media outlets reported in 2013 that Detroit, Michigan became the largest municipality to ever file Chapter 9.
“I have hopes that we can stick this out,” Hankins said. “We may lose some employees, but we have to do what we have to in order to keep the doors open.”
Travis M. Smith, @Travis5mith