UMC proposes tax hike to pay for $60M deficit

Budget report estimates Children's Hospital could be in debt $109M by 2015

EL PASO, Texas - University Medical Center held its first day of budget hearings for fiscal year 2015 Monday afternoon.

The hospital's board proposed an 8% increase tax increase, meaning taxpayers would have to shell out more money for property taxes.

Currently, taxpayers pay UMC about 21 cents per $100 of home valuation.

UMC is facing a $60 million deficit because of neighboring El Paso Children's Hospital.

Children's owes UMC more than $70 million dollars that it will not be able to repay this year.

No action was taken on the proposal, but it is expected to go before County Commissioners on August 4.

UMC officials said the increase would give the hospital $88 million and $6.4 million more than the current tax rate.

Children's was supposed to pay back $30 million this year but only repaid $4 million.

According to a UMC budget report, Children's debt could be up to $109 million by September 2015. Children's has disputed UMC's figures.

After the budget hearing, County Judge Veronica Escobar said she would like to see the tax rate stay the same because taxpayers saw increases that last two years.

She also added that there will be a domino effect if the rate isn't hiked.

"If we don't approve a tax increase, they will then effectively shut the doors of Children's.

One of the responsible things for us to do is take that budget and put it in the hands of our auditor and have our own budget review," said Escobar.

UMC has proposed to cut $12 million from its 2015 budget.

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