By Mary Alice Murphy

The Silver City-Grant County Chamber of Commerce featured two community leaders as speakers at its monthly luncheon on Thursday, Oct. 6, 2016.

After Chamber Board President Dave Thomas welcomed new members, he introduced Western New Mexico University President Joseph Shepard.

"On November 8, you will have a decision to make'whether you like or don't like to raise a tax, the revenue is becoming more and more scarce on the state level," Shepard said. "The legislators are working in special session to close the $160 million deficit for this fiscal year and are projecting a $400 million deficit to address next year. The Tobacco Settlement Fund will fill the hole this year, but cuts are being made across the board, with higher education likely to see a 5 percent to a 5.5 percent cut. Next year, we will see more reductions. It's not just the extractive energies causing this, but also ancillary services. There hasn't been a dramatic decrease in production, but the state has seen reductions in gross receipts taxes.

"They have the same stories at the hospital," Shepard continued. "They were cut 2.5 percent and another 5 percent. The hospital's 4-mill levy request will add a little over $3 million to its bottom line."

Shepard said the university has already cut its budget, because it can no longer rely on reserves or salary cuts, for instance when a professor leaves. "This year and next year, we are likely to see $2 million less, but you are not hearing from here that we will have layoffs, they way you are hearing it from New Mexico State University and the University of New Mexico. We did reductions three years ago and put aside reserves for this eventuality. Our enrollment is flat, but others are down as much as 8.6 percent. What is holding us up is that not all money is created equally. We get state funding, general obligation bonds and grants."

He said different pots of money are dedicated toward specific things. "For instance the Art in Public Places fund at the state level. We learned we had $172,000 in an account at the state. I believe strongly in the arts, so I looked at the catalogue of available art. I wanted to put some in our new garden beside Light Hall. In less than a week, we picked out five pieces to put in the sculpture garden and at the nursing school building. There were different sources in the catalogue, but not a single Silver City artist."

He continued: "I want to go back to the community issue. You have to participate and vote. There are two bonds on the ballot. Bond B would bring $200,000 to libraries. Bond C, a general obligation bond, would bring $5 million to this university for the renovation of Harlan Hall, infrastructure improvements, such as fixing leaking roofs and improvements at Juan Chacon and Graham Gym. We want to put solar arrays in one of our parking lots and on the bleachers at the football field."

Curb appeal is important to students, Shepard said. "If the bond does not pass, this university will not receive capital funds again until in about three years."

He noted if the bond passes, it would bring jobs to the local economy. "When we replaced the wall in front of Light Hall, we used a local contractor. He and his crew then went and shopped locally and ate at restaurants, so it benefits the whole economy."

Shepard also said that if Bond B and Bond C pass, they would not increase anyone's taxes. "It they don't pass, theoretically taxes go down, but last time the bonds didn't pass, taxes didn't decrease."

Resident Vic Topmiller Jr. asked why the taxes don't go up, if the bonds pass.

Shepard explained that they are paid through a permanent state tax, with older bonds that sunset, so the amount of money remains about the same in the general obligation fund as the bonds are paid off.

Bruce Ashburn of PNM said he wanted to compliment Shepard and the university about how well they use money. "The university has received multiple PNM rebates. You have been a good steward of funds."

Shepard said a solar array would offset electrical costs. The university has replaced bulbs with LED fixtures, which have also saved electrical costs. The garden area has retention ponds to push water into the soil.

"I believe the state appropriations will continue to decrease," he continued. "We need to come up with other business opportunities, by taking a good look at other businesses and governments. I recently returned from Macedonia, which is north of Greece and was once part of Yugoslavia. We made a deal with the government to partially train their military here. We are creating more and more partnerships with Mexico, which brings in students several times a year. Additional revenue streams help us with the university and its revenue stream. If you think you like what you see, I am only one person. We have a fantastic faculty, and I'm all about community, and you stand with me. We are living in one of the best places in the country."

The second speaker was Gila Regional Medical Center Chief Executive Officer Brian Cunningham.

"Dr. Shepard, you painted an accurate picture," Cunningham said. "Things are tight at the state level and across the country. Things are challenging in the health care area, with deductibles going up, co-pays going up. We, in 2013 were receiving $15 million a year until the program went away. It was replaced by the safety net care pool, from which we received $4 million in 2015. Without layoffs, we absorbed the cut and created new revenue. In 2013, the hospital was $ 9 million in the red, but by 2014, we were above by $1.2 million. Now we're about at break even. Reimbursement cuts keep coming. At the end of fiscal year 2015, we were in the black by about $72,000. At the end of fiscal year 2016, we were in the negative by about $3 million. For the necessary electronic health records upgrade, we have taken $6 million out of savings. We do have cash in the bank. A lot of great work has been done by our staff and caregivers, but we're drawing down that cash."

He said the hospital has lot of equipment costs, and in a 33-year-old building, boilers go out, air-handling units need to be upgraded, pipes break. "Well over 100 projects are going on at any one time."

"Gila Regional's No. 1 focus is quality care," Cunningham said. "The Centers for Medicare and Medicaid just awarded Gila Regional as a 4-Star Quality hospital. CMS ranks every hospital across the county. Only three 4-Star hospitals are in New Mexico, and Gila Regional is one of them. The state has no 5-Star hospitals. As a 4-Star hospital we are in the top 20 percent of hospitals in the country. Five-Star hospitals are in the top 2 percent. That's our next goal."

He said the concept of a mill levy to support the community hospital is nothing new in New Mexico or across the country. In New Mexico, 14 other counties offer support to their hospitals through mill levies.

"Gila Regional is one of the last to seek the support," Cunningham said. "When we were $9 million in the hole, we didn't ask for help. We knew we had to create efficiencies. We have dropped from 150 days of cash on hand down to 106. We're still OK, but trending downward. The average days in cash for hospitals roughly our size in New Mexico is in the 30s.

"We are taking a proactive approach," Cunningham continued. "We are trying to inform the community so people can vote in an informed way. Taos was the most recent to pass a mill levy, when they were down to 11, 12 or 13 days of cash."

He said the scary part of a downward spiral is that, if the hospital cannot replace a critical piece of equipment, local residents have to go to Las Cruces, for instance. It costs money if they have to stay in a hotel, plus gas purchases and food, not to mention lost time from work.

"The goal of our program is to keep the 4-Star quality," Cunningham said. "If we lose equipment, we lose physicians, because they go somewhere else that has the equipment. Then we lose other services and other jobs. Nurses are already very difficult to recruit, because of the nationwide shortage. If they start to leave, how do you recruit doctors and nurses if they know the hospital is in a downward spiral?"

He said that is why the hospital is having the proactive discussion. "Taos will have to dig its way out. We've worked our way out of a hole, but the cuts keep coming. We are here to inform you and lay out the reality of the situation. As a community, we have to decide what we want to support and how much we can afford. Yes, this levy will increase your property tax. If it passes, we will receive about $3.3 million a year to offset about $5 million in capital needs for equipment and building infrastructure. We will report how the money is spent in our board of trustees meetings and monthly to the County Commission."

"Our patients are our families," Cunningham said. "We ask you to pass the 4-mill levy to keep our 4-Star Quality."

Ted Presler asked if there were a possible compromise on the issue.

"We asked for a 4-mill levy to reach the $3 million benefit," Cunningham replied. "We don't want to lose the benefit, but, if it doesn't pass, we would be coming back to the community at some point. We will continue to work hard."

Kim Clark of the Realtors Association asked why Taos only asked for a 1-mill levy.

"I talked to them about that," Cunningham said. "They asked for only one mill because of the lack of trust by the community. The hospital had documented needs of $10 million, but they did it to start building back trust, with the assumption to ask for more later."

Shepard asked how much an MRI machine costs. Cunningham replied: "About $2 million. We have about 100 pieces of equipment that need to be upgraded that we have had to defer."

Tom Vaughan of FeVa Fotos asked who owns the hospital. Cunningham replied the county owns the hospital, building and equipment.

"So it was an investment," Vaughan said.

Topmiller asked what the immediate goals of the hospital are if the initiative passes.

"We would purchase equipment that we can't afford this year," Cunningham said. "Plus we have a couple of construction projects and renovations for building upgrades. We will specifically share with the community what the money is being spent on."

Mary Hotvedt, candidate for House District 38, asked how the levy would affect practice management.

"Physicians are joining together in other organizations," Cunningham said. "Hidalgo Medical Services' and Gila Regional's joint goal is to keep practitioners in the community with the equipment they need. If we don't have the equipment they won't come to work with us."

County Assessor Raul Turrieta said the total assessed tax value in the county is $841 million. "In millage, we are the second lowest in the state to Taos," he said.

Cunningham said: "That's why we didn't go for gross receipts tax. We are one of the highest in the state for gross receipts tax, but one of the lowest in millage."

Sandy Feutz of FeVa Fotos noted that costs never go down.

"If the mill levy does not pass, we will not be able to offer as many services," Cunningham agreed. "Las Vegas had to drop its ob/gyn services."

He said different disciplines have different turnover rates. Turnover is about 15 percent to 16 percent locally, but 17 percent to 18 percent nationally. "We are a little less than nationally, but with turnover, we have to bring in high cost travelers, especially nurses."

Dan Otero, HMS CEO, noted that nurses also want to do specialties. "If we lose specialists, we lose nurses, too."

Joe Kellerman, Gila Regional marketing director, said on grmc.org, a PowerPoint presentation shows how the money will be spent and what is likely to happen if the mill levy does not pass. "We are being absolutely open about what we're doing."

During announcements, Ashburn said PNM continues to try to find ways to save its customers money with rebates. Sharon Vickery, PNM marketing, said the best part of her job is "giving away money. We partner with the university and will be partnering with the hospital. We provide rebates for qualified equipment." She introduced Joe Miller as the company's energy consultant. She continued: "If you have done energy improvement recently or plan them in the future, call me."

Feutz announced the 10-day Red Dot ArtFest and Studio Tour from Oct. 7 through Oct. 16.

Turrieta said the Grant County Trails group would be doing a hike to the Big Tree on Sunday, Oct. 9.

Jane Janson, Small Business Development Center director, said the agency would be offering a workshop from 1-3 p.m. on Wednesday, Oct. 26. "We will have a representative from the Department of Labor talking about the new overtime rules."

Cecilia Bell, Fort Bayard Historic Preservation Society president, said the group had recently received a donation of $2,500, which was matched by the village of Santa Clara to have State Forestry, using inmates to get rid of dead trees at the fort.

A representative from AmberCare said they would have an open house in November at their new facility.

Thomas said: "As a city of our size, it's impressive to have such passionate individuals promoting our important facilities."

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