Fight for recovery in Galveston begins

Galveston's mayor pleaded for help and got enormous applause after she gave her impassioned speech. Mayor Lyda Ann Thomas laid out several things she believes the legislature can do to help restore Galveston. High on the list was addressing the fate of UTMB.

After the hurricane, the hospital suffered severe damage. The UTMB Board of Regents voted to reduce its staff by 3,000 employees and eliminated the Level 1 Trauma Center.

Mayor Thomas believes part of the solution to not only helping the hospital but the city recover is to seek tax relief. Specifically she wants the sales tax the state collects to be rebated back to the city. Of the 8% sales tax the state receives, 6% goes to the state. The mayor wants that percentage given back to the city. She says it was done after the storm of 1900 and it should be done now.

"We're simply saying give part of the part that you keep back. It will create a cash flow all along the coast which will give this city an opportunity to operate and to recover," said Mayor Thomas.

Later in the hearing, the UTMB Board of Regents made it very clear that it's going to need state money for the hospital to recover. Appearing before the panel, the board certainly got an earful in their decision to layoff employees in the aftermath of Hurricane Ike. UTMB is the largest employer in all of Galveston.

Almost immediately, one member of the panel asked the board why they didn't fight hard as they did for other institutions before they slashed jobs. Board members defended their decision, saying the hospital would have gone defunct if drastic measures weren't taken.

Critics questioned the math. One group suing the board for making decisions behind closed doors said it believes the job cuts were too hastily made.

"Decisions were made to throw away the lives of 3,000 people and their families days, days after Ike hit. What was the basis of that decision-making?" said Tom Johnson of the Texas Faculty Association.

The acting Chancellor of the UT system, Dr. Kenneth Shine, said, "Without the reduction in cost achieved through the reduction in force, the continuing rate of expenditures including wages and benefits for faculty and staff who could not return to work, were to exceed revenues by $40 million per month and would have drained all of the reserves of UTMB."

The board said it will need around $700 million to recover. It says it will ask the state to pick up most of that cost while hoping that FEMA reimburses that money.