Office of the Governor Rick Perry

Gov. Perry Announces Funding for UTMB Hurricane Ike Recovery

Also signs TWIA reform bill
Friday, June 19, 2009  •  Press Release

GALVESTON – Gov. Rick Perry today signed House Bill (HB) 4586, the supplemental appropriations bill that includes $150 million in funding to help the University of Texas Medical Branch (UTMB) in Galveston recover from Hurricane Ike. The governor also signed HB 4409, which reforms the Texas Windstorm Insurance Association (TWIA).

“The past year was especially difficult for this community as Hurricane Ike destroyed homes, displaced our citizens and knocked out one of only three Level One trauma centers in this area,” Gov. Perry said. “I am pleased that the Legislature has funded a number of key initiatives that will help UTMB continue to serve this community by treating patients, training doctors and setting the standard for medical excellence in this area.”

HB 4586 secures more than $425 million dollars for disaster-related costs and expenditures, including $62 million in first-time funding for the state’s disaster contingency fund, $150 million for UTMB to recovery from Ike, and additional funding to help the recovery of communities affected by Ike. Funding for UTMB includes repairing educational, research, hospital and clinic space, and permitting their Trauma Center to reopen this summer at Level Three status, and eventually back to Level One in early 2010.

Additionally, on Wednesday Gov. Perry signed HB 51 authorizing the issuance of $150 million in tuition revenue bonds for Hurricane Ike recovery at UTMB. The school will use these funds to build a new 200 bed hospital tower adjacent to the existing John Sealy Hospital, restoring bed capacity to 550, as it was prior to Hurricane Ike. These funds will be matched by a $200 million contribution from the Sealy Smith Foundation. 

The governor also signed HB 4409 today which enacts necessary reforms to TWIA that will ultimately reduce the burden of catastrophic storms on the state and eventually establish TWIA as an insurer of last resort. Provisions of the bill were declared emergency items by the governor in the recent legislative session.

“This legislation addresses a number of essential issues that have been making it tough for insurance companies to remain engaged along the Texas coast,” said Gov. Perry. “This bill represents progress, incorporating sound business practices to improve the way we handle a critical issue that affects all Texans.”

House Bill 4409 eases previous funding restrictions on TWIA by allowing coverage of up to $2.5 billion in losses through various funding methods. Damage payments can now be funded by premiums, reserves, public securities, commercial paper and other market source financial instruments.

The bill also requires the Texas Department of Insurance to maintain a list of insurers who voluntarily write windstorm coverage, and develop incentives for insurers to voluntarily write coverage along the coast. This provision will assist consumers in searching for other providers with the goal of shifting the coverage burden away from TWIA, ultimately establishing it as an insurer of last resort as originally intended.

For more information about the 81st Legislative Session, please visit or

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