Office of the Attorney General News Release Archive

Tuesday, June 12, 2001


Children's Hospital to Fund $3 Million Facility in McAllen

AUSTIN - Texas Attorney General John Cornyn has obtained a significant agreement with the Driscoll Foundation in Corpus Christi to increase its funding of the Driscoll Children's Hospital by tens of millions of dollars per year, or about 800 percent above current levels. Additionally, the hospital has agreed to dedicate more than $3 million to build and staff a charitable pediatric clinic in McAllen.

"This is a happy day for the children of lower income families along the Texas coast and in the Lower Rio Grande Valley," said Attorney General Cornyn. "The foundation's agreement to increase its funding of the hospital, and the hospital's agreement to build this clinic send a strong signal that nonprofit, charitable medical foundations must devote a sizable portion of their income to charitable work and public health, as originally intended by the creators of such charities."

An Attorney General's investigation revealed that the Driscoll Foundation had been setting aside only about 10 percent of its annual income for children's health care at Driscoll Children's Hospital. Under the terms of the agreement, the foundation must now dedicate 90 percent of its annual income to charitable health care.

Membership on the foundation board of trustees will now increase from three to seven, which allows for more diversity in decision-making. One of these trustees is from the Lower Rio Grande Valley. In addition, yearly stipends paid to trustees have been limited to approximately $10,000 plus expenses.

The agreement also requires the foundation to provide annual copies of its federal tax returns to the Attorney General as a way to monitor compliance with these measures.

"These procedures, when implemented, will contribute to children's health care in Texas, and in the process, will fulfill the charitable intent of the institution's namesake, Mrs. Clara Driscoll," said Mr. Cornyn.

Although the hospital and foundation work in tandem, the Driscoll Foundation was spun off from the hospital operations in the 1970s as a way to secure a stable pool of assets to fund the charitable mission of the Driscoll Children's Hospital.

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