By: Sibley S.B. No. 221 73R2630 DLF-F A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to the creation, administration, powers, duties, 1-3 operation, and financing of the West Community Hospital District; 1-4 authorizing a tax; granting the authority to issue bonds; and 1-5 granting the power of eminent domain. 1-6 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-7 ARTICLE 1. GENERAL PROVISIONS 1-8 SECTION 1.01. DEFINITIONS. In this Act: 1-9 (1) "District" means the West Community Hospital 1-10 District. 1-11 (2) "Board" means the board of directors of the 1-12 district. 1-13 (3) "Director" means a member of the board. 1-14 SECTION 1.02. DISTRICT AUTHORIZATION. The West Community 1-15 Hospital District may be created and established and, if created, 1-16 must be maintained, operated, and financed in the manner provided 1-17 by Article IX, Section 9, of the Texas Constitution and by this 1-18 Act. 1-19 SECTION 1.03. BOUNDARIES. Except as provided by Section 1-20 3.07 of this Act, the boundaries of the district are coextensive 1-21 with the boundaries of the West Independent School District in 1-22 McLennan County and the boundaries of the Gholson Independent 1-23 School District in McLennan County. The district does not include 1-24 any portion of those districts located in Hill County. 2-1 ARTICLE 2. TEMPORARY DIRECTORS 2-2 SECTION 2.01. TEMPORARY DIRECTORS. On the effective date of 2-3 this Act, the following persons become temporary directors of the 2-4 district: 2-5 (1) David W. Pareya; 2-6 (2) Ray Holasek; 2-7 (3) Richard Griffin; 2-8 (4) Larry Lichnovsky; 2-9 (5) Freddie Kaluza; 2-10 (6) Martha Shaw; 2-11 (7) Phyllis Jackson; 2-12 (8) Dee Anne Reaves; 2-13 (9) Jose Eisma, M.D.; 2-14 (10) George Smith, D.O.; 2-15 (11) Charles Harsanyi; 2-16 (12) Helen Ballew; 2-17 (13) H. T. Sexton; and 2-18 (14) Tim Harrington. 2-19 SECTION 2.02. VACANCY IN OFFICE. The directors remaining 2-20 after a vacancy in the office of a temporary director shall fill 2-21 the vacancy by appointment by majority vote. 2-22 ARTICLE 3. CREATION OF DISTRICT 2-23 SECTION 3.01. CREATION ELECTIONS. The district may be 2-24 created and a tax may be authorized only if the creation and the 2-25 tax are approved by a majority of the qualified voters of the 2-26 territory of the proposed district voting at elections called and 2-27 held for that purpose. 3-1 SECTION 3.02. ORDERING ELECTION. (a) A majority of the 3-2 temporary directors of the district may order two creation 3-3 elections to be held as prescribed by Subsection (c) of this 3-4 section. 3-5 (b) On presentation of a petition for a creation election 3-6 signed by at least 50 of the registered voters of the territory of 3-7 the proposed district, according to the most recent official list 3-8 of registered voters, the temporary directors shall order two 3-9 creation elections to be held as prescribed by Subsection (c) of 3-10 this section. The elections shall be called not later than the 3-11 60th day after the date the petition is presented to the district. 3-12 (c) The election orders must call for an election to be held 3-13 in the territory within the West Independent School District 3-14 boundaries in McLennan County and a separate election to be held in 3-15 the territory within the Gholson Independent School District 3-16 boundaries in McLennan County. Both elections must be held on the 3-17 same date. 3-18 SECTION 3.03. ELECTION ORDER. The orders calling the 3-19 elections must state: 3-20 (1) the nature of the elections, including the 3-21 proposition that is to appear on each ballot; 3-22 (2) the date of the elections; 3-23 (3) the hours during which the polls will be open; and 3-24 (4) the location of the polling places. 3-25 SECTION 3.04. NOTICE. The temporary directors shall give 3-26 notice of the elections by publishing a substantial copy of the 3-27 election orders in a newspaper of general circulation in the 4-1 proposed district once a week for two consecutive weeks. The first 4-2 publication must appear at least 35 days before the date set for 4-3 the elections. 4-4 SECTION 3.05. ELECTION DATE. (a) The elections shall be 4-5 held not less than 45 days or more than 60 days after the date on 4-6 which the elections are ordered. 4-7 (b) Section 41.001(a), Election Code, does not apply to an 4-8 election ordered under this article. 4-9 SECTION 3.06. BALLOT PROPOSITION. The ballot for the 4-10 elections shall be printed to permit voting for or against the 4-11 proposition: "The creation of the West Community Hospital District 4-12 and the levy of annual taxes for hospital purposes at a rate not to 4-13 exceed 40 cents on each $100 valuation of all taxable property in 4-14 the district." 4-15 SECTION 3.07. CANVASSING RETURNS. (a) Immediately after 4-16 the elections, the presiding judge of each polling place shall 4-17 deliver returns of the elections to the temporary directors, and 4-18 the temporary directors shall canvass the returns and declare the 4-19 results. 4-20 (b) If a majority of the votes cast at the elections in both 4-21 school districts favor creation of the district, the board shall 4-22 declare the district created and shall enter the results in its 4-23 minutes. If the election results are favorable in the territory 4-24 included in the West Independent School District, but not in the 4-25 territory included in the Gholson Independent School District, the 4-26 temporary directors shall set the boundaries of the district to 4-27 include only the territory included in the West Independent School 5-1 District. If a majority of the votes cast at each election or at 5-2 the election in the territory included in the West Independent 5-3 School District are against the creation of the district, the board 5-4 shall declare that the creation of the district was defeated and 5-5 shall enter the results in its minutes. 5-6 (c) If the creation of the district is defeated, the board 5-7 may call and hold additional creation elections, but another 5-8 creation election may not be called and held by the board within 5-9 six months after the date of the most recent creation election. 5-10 SECTION 3.08. EXPIRATION OF ACT. If the creation of the 5-11 district is not approved at an election held within 60 months after 5-12 the effective date of this Act, this Act expires. 5-13 ARTICLE 4. DISTRICT ADMINISTRATION 5-14 SECTION 4.01. BOARD OF DIRECTORS. (a) Except as provided 5-15 by Subsection (b) of this section, the district is governed by a 5-16 board of seven directors. 5-17 (b) If the temporary directors set the boundaries of the 5-18 district to include only the territory included in the West 5-19 Independent School District in accordance with Section 3.07(b) of 5-20 this Act, the district is governed by a board of five directors. 5-21 (c) From the time the creation of the district is approved 5-22 until the elected directors take office, the temporary directors 5-23 serve as directors of the district. 5-24 SECTION 4.02. INITIAL DIRECTORS ELECTION. (a) Directors 5-25 shall be elected at an election to be held on the first Saturday in 5-26 May following the creation of the district. 5-27 (b) After the initial election of directors, the directors 6-1 shall draw lots to determine which three directors shall serve 6-2 one-year terms and which four directors shall serve two-year terms. 6-3 If the number of directors is reduced to five under Section 4.01(b) 6-4 of this Act, after the initial election of directors, the directors 6-5 shall draw lots to determine which two directors shall serve 6-6 one-year terms and which three directors shall serve two-year 6-7 terms. 6-8 SECTION 4.03. METHOD OF ELECTION; STAGGERED TERMS; TERM OF 6-9 OFFICE. (a) The temporary directors shall establish the five or 6-10 seven precincts, as appropriate, from which the directors are 6-11 elected. The precincts must be contiguous and substantially equal 6-12 in population, according to the most recent federal decennial 6-13 census. 6-14 (b) One director shall be elected from each precinct. 6-15 (c) After the initial election of directors, an election 6-16 shall be held on the first Saturday in May each year to elect the 6-17 appropriate number of successor directors. 6-18 (d) Except as provided by Section 4.02(b) of this Act and 6-19 Subsection (e) of this section, each director is elected for a 6-20 two-year term. 6-21 (e) The board shall revise each precinct after the 6-22 publication of each federal decennial census to reflect population 6-23 changes. At the first election after the precincts are revised, a 6-24 new director shall be elected from each precinct. The directors 6-25 shall draw lots to determine which two or three directors, as 6-26 appropriate, shall serve one-year terms and which three or four 6-27 directors, as appropriate, shall serve two-year terms. 7-1 SECTION 4.04. NOTICE OF ELECTION. At least 35 days before 7-2 the date of an election of directors, notice of the election shall 7-3 be published one time in a newspaper with general circulation in 7-4 the district. 7-5 SECTION 4.05. APPLICATION. (a) A person who wishes to have 7-6 the person's name printed on the ballot as a candidate for director 7-7 must file with the secretary of the board of directors an 7-8 application on a form provided by the district asking that the 7-9 person's name be placed on the ballot. 7-10 (b) The application must specify the precinct that the 7-11 candidate wishes to represent. 7-12 SECTION 4.06. QUALIFICATIONS FOR OFFICE. (a) To be 7-13 eligible to be a candidate for or to serve as a director, a person 7-14 must be: 7-15 (1) a resident of the district; and 7-16 (2) a qualified voter. 7-17 (b) In addition to the qualifications required by Subsection 7-18 (a) of this section, a person who is elected from a precinct or who 7-19 is appointed to fill a vacancy for a precinct must be a resident of 7-20 that precinct. 7-21 (c) An employee of the district may not serve as a director. 7-22 SECTION 4.07. BOND. (a) Before assuming the duties of the 7-23 office, each director must execute a bond for $5,000 payable to the 7-24 district, conditioned on the faithful performance of the person's 7-25 duties as director. 7-26 (b) The bond shall be kept in the permanent records of the 7-27 district. 8-1 (c) The director shall obtain the bond from an insurance 8-2 company authorized to do business in this state. The board shall 8-3 pay for the director's bond with district funds. 8-4 SECTION 4.08. BOARD VACANCY. (a) Except as provided by 8-5 Subsection (b) of this section, a vacancy in the office of director 8-6 shall be filled for the unexpired term by appointment by the 8-7 remaining directors. The person appointed must have the 8-8 qualifications prescribed by Section 4.06 of this Act. 8-9 (b) If the offices of five or more directors are vacant 8-10 simultaneously, the remaining directors shall call a special 8-11 election to fill the unexpired terms. Sections 3.03, 3.04, and 8-12 3.05 of this Act apply to an election called under this subsection. 8-13 SECTION 4.09. OFFICERS. The board shall elect from among 8-14 its members a president, a vice-president, and a treasurer. The 8-15 board shall also appoint a secretary. The secretary need not be a 8-16 director. 8-17 SECTION 4.10. OFFICERS' TERMS; VACANCY. (a) Each officer 8-18 of the board serves for a term of one year. 8-19 (b) The board shall fill a vacancy in a board office for the 8-20 unexpired term. 8-21 SECTION 4.11. COMPENSATION. Directors and officers serve 8-22 without compensation but may be reimbursed for actual expenses 8-23 incurred in the performance of official duties. Those expenses 8-24 must be reported in the district's minute book or other district 8-25 records and must be approved by the board. 8-26 SECTION 4.12. QUORUM; VOTING REQUIREMENT. (a) Except as 8-27 necessary to call a special election under Section 4.08(b) of this 9-1 Act, a majority of the membership of the board constitutes a quorum 9-2 for the transaction of business. 9-3 (b) A concurrence of a majority of the members of the board 9-4 voting is necessary in matters relating to the business of the 9-5 district. 9-6 SECTION 4.13. ADMINISTRATOR. (a) The board may appoint a 9-7 qualified person as administrator of the district. 9-8 (b) The administrator serves at the will of the board. 9-9 (c) The administrator is entitled to compensation as 9-10 determined by the board. 9-11 (d) Before assuming the duties of administrator, the person 9-12 appointed shall execute a bond payable to the hospital district in 9-13 the amount of not less than $5,000 as determined by the board, 9-14 conditioned on the faithful performance of duties under this Act. 9-15 The bond shall be kept in the permanent records of the district. 9-16 The administrator shall obtain the bond from an insurance company 9-17 authorized to do business in this state. The board may pay for the 9-18 bond with district funds. 9-19 SECTION 4.14. APPOINTMENTS TO STAFF. The board may appoint 9-20 to or remove from the staff any doctors as the board considers 9-21 necessary for the efficient operation of the district, and may make 9-22 temporary appointments as considered necessary. The board may 9-23 adopt policies relating to the method of appointing and removing 9-24 staff members. 9-25 SECTION 4.15. TECHNICIANS, NURSES, AND OTHER DISTRICT 9-26 EMPLOYEES. (a) The district may employ technicians, nurses, 9-27 fiscal agents, accountants, architects, attorneys, and other 10-1 necessary employees. 10-2 (b) The board may delegate to the administrator the 10-3 authority to employ persons for the district. 10-4 SECTION 4.16. PROFESSIONAL PERSONNEL RECRUITMENT. The board 10-5 may employ innovative methods to recruit physicians, nurses, 10-6 technicians, and other professional personnel. The methods may 10-7 include scholarship programs, agreements for future services, 10-8 shared personnel, bonuses, and any other method the district 10-9 considers necessary. 10-10 SECTION 4.17. GENERAL DUTIES OF ADMINISTRATOR. The 10-11 administrator shall supervise the work and activities of the 10-12 district and shall direct the general affairs of the district, 10-13 subject to the limitations prescribed by the board. 10-14 SECTION 4.18. RETIREMENT BENEFITS. The board may provide 10-15 retirement benefits for employees of the district by establishing 10-16 or administering a retirement program or by electing to participate 10-17 in the Texas County and District Retirement System or in any other 10-18 statewide retirement system in which the district is eligible to 10-19 participate. 10-20 ARTICLE 5. POWERS AND DUTIES 10-21 SECTION 5.01. RESPONSIBILITY OF AND LIMITATION ON 10-22 GOVERNMENTAL ENTITY. (a) On creation of the district, West 10-23 Hospital Authority and McLennan County shall convey or transfer to 10-24 the district: 10-25 (1) title to land, buildings, improvements, and 10-26 equipment related to any hospital system located in the district 10-27 that is owned by the West Hospital Authority or McLennan County; 11-1 (2) operating funds and reserves for operating 11-2 expenses and funds that have been budgeted by the West Hospital 11-3 Authority or McLennan County to provide medical care for residents 11-4 of the district for the remainder of the fiscal year in which the 11-5 district is established; 11-6 (3) accounts receivable of the West Hospital Authority 11-7 or McLennan County for medical care provided for residents of the 11-8 district; 11-9 (4) taxes levied by McLennan County for hospital 11-10 purposes for residents of the district for the year in which the 11-11 district is created; and 11-12 (5) funds established for payment of indebtedness 11-13 assumed by the district. 11-14 (b) On or after creation of the West Community Hospital 11-15 District, another political entity may not levy taxes or issue 11-16 bonds or other obligations for hospital purposes or for providing 11-17 medical care for the residents of the district. 11-18 SECTION 5.02. DISTRICT RESPONSIBILITIES. (a) On creation 11-19 of the district, the district: 11-20 (1) assumes full responsibility for operating hospital 11-21 facilities and for furnishing medical and hospital care for the 11-22 district's needy inhabitants; 11-23 (2) assumes any outstanding indebtedness, including 11-24 bonded indebtedness, incurred by the West Community Hospital, the 11-25 West Hospital Authority, or McLennan County for hospital purposes 11-26 for residents of the district before the district's creation; 11-27 (3) may operate or provide for the operation of a 12-1 mobile emergency medical or air ambulance service; and 12-2 (4) may operate or provide for home-health services, 12-3 long-term care, skilled nursing care, intermediate nursing care, 12-4 hospital care, or any other reasonable or appropriate medical care 12-5 or medical services. 12-6 (b) The board has complete discretion as to the type and 12-7 extent of services the district will offer. The district may 12-8 provide any services the board finds necessary for hospital or 12-9 medical care, including necessary nurses or domiciliaries. 12-10 SECTION 5.03. MANAGEMENT, CONTROL, AND ADMINISTRATION. The 12-11 board shall manage, control, and administer the hospital system and 12-12 the funds and resources of the district. 12-13 SECTION 5.04. DISTRICT RULES. The board may adopt rules 12-14 governing the operations of the hospital and hospital system and 12-15 the duties, functions, and responsibilities of district staff and 12-16 employees. 12-17 SECTION 5.05. METHODS AND PROCEDURES. (a) The board may 12-18 prescribe the method of making purchases and expenditures by and 12-19 for the district. 12-20 (b) The board may proscribe accounting and control 12-21 procedures for the district. 12-22 (c) The board may spend money to recruit physicians, nurses, 12-23 and other personnel, except as prohibited by law. 12-24 SECTION 5.06. HOSPITAL FACILITIES. (a) The board shall 12-25 determine the type, number, and location of buildings required to 12-26 establish and maintain an adequate hospital system and the type of 12-27 equipment necessary for hospital care. 13-1 (b) The district has complete discretion as to the type and 13-2 extent of services the district will offer. The district may 13-3 provide any facilities the board finds necessary for hospital or 13-4 medical care, including facilities for: 13-5 (1) domiciliary care, including geriatric domiciliary 13-6 care; 13-7 (2) outpatient clinics and minor emergency centers; 13-8 (3) dispensaries; 13-9 (4) convalescent homes; 13-10 (5) blood banks; 13-11 (6) community mental health centers; 13-12 (7) alcohol or chemical dependency centers; 13-13 (8) research centers; 13-14 (9) laboratories; or 13-15 (10) training centers. 13-16 (c) The board may acquire property, facilities, and 13-17 equipment for the district for use in the hospital system and may 13-18 mortgage or pledge the property, facilities, or equipment acquired 13-19 as security for the payment of the purchase price. 13-20 (d) The board may lease hospital facilities on behalf of the 13-21 district. 13-22 (e) The board may sell or otherwise dispose of property, 13-23 facilities, or equipment on behalf of the district, at public or 13-24 private sale, and at the price and terms the board considers most 13-25 advantageous. The board shall give notice of intent to sell land 13-26 or buildings by publishing a notice of intent in a newspaper with 13-27 general circulation in McLennan County, Texas, not later than the 14-1 30th day before the date of the sale. 14-2 (f) Subchapter D, Chapter 285, Health and Safety Code, does 14-3 not apply to the district. 14-4 SECTION 5.07. CONSTRUCTION CONTRACTS. (a) The board may 14-5 enter into construction contracts on behalf of the district. 14-6 However, the board may enter into construction contracts that 14-7 involve spending more than $10,000 only after competitive bidding 14-8 as provided by Subchapter B, Chapter 271, Local Government Code. 14-9 (b) Article 5160, Revised Statutes, as it relates to 14-10 performance and payment bonds, applies to construction contracts 14-11 let by the district. 14-12 SECTION 5.08. DISTRICT OPERATING AND MANAGEMENT CONTRACTS. 14-13 The board may enter into operating or management contracts relating 14-14 to hospital facilities on behalf of the district. 14-15 SECTION 5.09. EMINENT DOMAIN. (a) The district may 14-16 exercise the power of eminent domain to acquire by condemnation a 14-17 fee simple or other interest in property located in the territory 14-18 of the district if the property interest is necessary to the 14-19 exercise of the rights or authority conferred by this Act. 14-20 (b) The district must exercise the power of eminent domain 14-21 in the manner provided by Chapter 21, Property Code, but the 14-22 district is not required to deposit in the trial court money or 14-23 bond as provided by Section 21.021(a), Property Code. 14-24 (c) In a condemnation proceeding brought by the district, 14-25 the district is not required to pay in advance or give bond or 14-26 other security for costs in the trial court, to give bond for the 14-27 issuance of a temporary restraining order or a temporary 15-1 injunction, or to give bond for costs or supersedeas on an appeal 15-2 or writ of error. 15-3 SECTION 5.10. EXPENSES FOR MOVING FACILITIES OF RAILROADS 15-4 AND UTILITIES. In exercising the power of eminent domain, if the 15-5 board requires relocating, raising, lowering, rerouting, changing 15-6 the grade, or altering the construction of any railroad, highway, 15-7 pipeline, or electric transmission and electric distribution, 15-8 telegraph, or telephone lines, conduits, poles, or facilities, the 15-9 district must bear the actual cost of relocating, raising, 15-10 lowering, rerouting, changing the grade, or altering the 15-11 construction to provide comparable replacement without enhancement 15-12 of facilities, after deducting the net salvage value derived from 15-13 the old facility. 15-14 SECTION 5.11. INDIGENT CARE. (a) The district shall supply 15-15 care and treatment without charge to a patient who resides in the 15-16 district if the patient or relative who is legally responsible for 15-17 the patient's support cannot pay for the care and treatment, as 15-18 required by Article IX, Section 9, of the Texas Constitution. Care 15-19 and treatment provided under this subsection is limited to the 15-20 hospital inpatient and outpatient services that the hospital 15-21 regularly provides to other patients. 15-22 (b) The district may adopt, amend, or repeal policies or 15-23 rules relating to indigent health care, including policies or rules 15-24 relating to: 15-25 (1) eligibility of patients for indigent health care; 15-26 (2) application forms for patients or relatives of 15-27 patients requesting indigent health care that may require personal 16-1 and financial information to be furnished; 16-2 (3) procedures for obtaining and completing 16-3 applications for indigent health care and for filing the completed 16-4 applications with the district; 16-5 (4) procedures for reviewing applications to determine 16-6 eligibility for indigent health care; and 16-7 (5) other procedures under this section. 16-8 (c) The application procedure to determine eligibility for 16-9 indigent health care must be adopted not later than the beginning 16-10 of each operating year and must comply with Section 61.053, Health 16-11 and Safety Code. 16-12 (d) The administrator of the district may have an inquiry 16-13 made into the financial circumstances of any patient residing in 16-14 the district and admitted to a district facility and into the 16-15 financial circumstances of a relative of the patient who is legally 16-16 responsible for the patient's support. 16-17 (e) On finding that the patient or a relative of the patient 16-18 who is legally responsible for the patient's support can pay for 16-19 all or any part of the care and treatment provided by the district, 16-20 the administrator shall issue an order directing the patient or the 16-21 relative to pay the district each week a specified amount that the 16-22 individual is able to pay. 16-23 (f) The administrator may collect money owed to the district 16-24 from the estate of the patient or from that of a relative who was 16-25 legally responsible for the patient's support in the manner 16-26 provided by law for collection of expenses in the last illness of a 16-27 deceased person. 17-1 (g) If there is a dispute relating to an individual's 17-2 ability to pay, the board may call witnesses, issue subpoenas duces 17-3 tecum, administer oaths, hear and resolve the question, and issue a 17-4 final order. An appeal from a final order of the board must be 17-5 made to a district court in the county in which the district is 17-6 located and the substantial evidence rule applies. 17-7 SECTION 5.12. REIMBURSEMENT FOR SERVICES. (a) The board 17-8 shall require reimbursement from a county, city, or public hospital 17-9 located outside the boundaries of the district for the district's 17-10 care and treatment of a sick, diseased, or injured person of that 17-11 county, city, or public hospital as provided by Chapter 61, Health 17-12 and Safety Code. 17-13 (b) The board shall require reimbursement from the sheriff 17-14 of McLennan County for the district's care and treatment of a 17-15 person confined in a jail facility of McLennan County who is not a 17-16 resident of the district. 17-17 (c) The board may contract with state or federal government 17-18 for the state or federal government to reimburse the district for 17-19 treatment of a sick, diseased, or injured person. 17-20 SECTION 5.13. DISTRICT LIABILITY FOR SERVICES AND PAYMENTS. 17-21 (a) The maximum district liability for each district fiscal year 17-22 for all services to an eligible district resident in that year is 17-23 $5,000. 17-24 (b) The district liability for payment for a particular 17-25 mandatory medical service for an eligible district resident is 17-26 limited to the payment standard established under the AFDC-1 17-27 Medicaid program. 18-1 (c) The district liability under this section for hospital 18-2 inpatient and outpatient services is limited to the hospital 18-3 inpatient and outpatient services that the hospital regularly 18-4 provides to other patients. 18-5 (d) Subsections (b) and (c) of this section do not apply if 18-6 the district contracts with the provider for the services and the 18-7 provider certifies that the provider will comply with Subsections 18-8 (b) and (c) for each service rendered. 18-9 SECTION 5.14. SERVICE CONTRACTS. The board may contract 18-10 with a city, county, special district, or other political 18-11 subdivision of the state or federal agency for the district to 18-12 furnish a mobile emergency medical or air ambulance service or to 18-13 provide for the investigatory or welfare needs of inhabitants of 18-14 the district. 18-15 SECTION 5.15. GIFTS AND ENDOWMENTS. On behalf of the 18-16 district, the board may accept gifts and endowments to be held in 18-17 trust for any purpose and under any direction, limitation, or 18-18 provision prescribed in writing by the donor that is consistent 18-19 with the proper management of the district. 18-20 SECTION 5.16. AUTHORITY TO SUE AND BE SUED. The board may 18-21 sue and be sued on behalf of the district. 18-22 ARTICLE 6. DISTRICT FINANCES 18-23 SECTION 6.01. FISCAL YEAR. (a) The district operates on 18-24 the fiscal year established by the board. 18-25 (b) The fiscal year may not be changed when revenue bonds of 18-26 the district are outstanding or more than once in a 24-month 18-27 period. 19-1 SECTION 6.02. ANNUAL AUDIT. Annually, the board shall have 19-2 an audit made of the financial condition of the district. 19-3 SECTION 6.03. DISTRICT AUDIT AND RECORDS. The annual audit 19-4 and other district records are open to inspection during regular 19-5 business hours at the principal office of the district. 19-6 SECTION 6.04. ANNUAL BUDGET. (a) The administrator of the 19-7 district shall prepare a proposed annual budget for the district. 19-8 (b) The proposed budget must contain a complete financial 19-9 statement, including a statement of: 19-10 (1) the outstanding obligations of the district; 19-11 (2) the amount of cash on hand to the credit of each 19-12 fund of the district; 19-13 (3) the amount of money received by the district from 19-14 all sources during the previous year; 19-15 (4) the amount of money available to the district from 19-16 all sources during the ensuing year; 19-17 (5) the amount of the balances expected at the end of 19-18 the year in which the budget is being prepared; 19-19 (6) the estimated amount of revenues and balances 19-20 available to cover the proposed budget; and 19-21 (7) the estimated tax rate that will be required. 19-22 SECTION 6.05. NOTICE; HEARING; ADOPTION OF BUDGET. (a) The 19-23 board shall hold a public hearing on the proposed annual budget. 19-24 (b) The board shall publish notice of the hearing in a 19-25 newspaper of general circulation in the district not later than the 19-26 10th day before the date of the hearing. 19-27 (c) Any resident of the district is entitled to be present 20-1 and participate at the hearing. 20-2 (d) At the conclusion of the hearing, the board shall adopt 20-3 a budget by acting on the budget proposed by the administrator. 20-4 The board may make any changes in the proposed budget that in its 20-5 judgment the interests of the taxpayers demand. 20-6 (e) The budget is effective only after adoption by the 20-7 board. 20-8 SECTION 6.06. AMENDING BUDGET. After adoption, the annual 20-9 budget may be amended on the board's approval. 20-10 SECTION 6.07. LIMITATION ON EXPENDITURES. Money may not be 20-11 spent for an expense not included in the annual budget or an 20-12 amendment to it. 20-13 SECTION 6.08. SWORN STATEMENT. As soon as practicable after 20-14 the close of the fiscal year, the administrator shall prepare for 20-15 the board a sworn statement of the amount of money that belongs to 20-16 the district and an account of the disbursements of that money. 20-17 SECTION 6.09. SPENDING AND INVESTMENTS LIMITATIONS. (a) 20-18 Except as provided by Sections 5.07(a), 6.10, 7.01, 7.04, and 7.05 20-19 of this Act, the district may not incur a debt payable from 20-20 revenues of the district other than the revenues on hand or to be 20-21 on hand in the current and immediately following fiscal years of 20-22 the district. 20-23 (b) The board may invest operating, depreciation, or 20-24 building reserves only in funds or securities specified by Article 20-25 836 or 837, Revised Statutes. 20-26 SECTION 6.10. BORROWING MONEY. The district may borrow 20-27 money to pay its operating expenses in an amount not to exceed the 21-1 amount of tax revenue that the district expects to receive during 21-2 the 12-month period following the date on which the money is 21-3 borrowed. The district may pledge all or any part of those tax 21-4 revenues to the payment of the amounts borrowed. 21-5 SECTION 6.11. DEPOSITORY. (a) The board shall name at 21-6 least one bank to serve as depository for district funds. 21-7 (b) District funds, other than those invested as provided by 21-8 Section 6.09(b) of this Act and those transmitted to a bank for 21-9 payment of bonds or obligations issued or assumed by the district, 21-10 shall be deposited as received with the depository bank and must 21-11 remain on deposit. This subsection does not limit the power of the 21-12 board to place a portion of district funds on time deposit or to 21-13 purchase certificates of deposit. 21-14 (c) Before the district deposits funds in a bank in an 21-15 amount that exceeds the maximum amount secured by the Federal 21-16 Deposit Insurance Corporation, the bank must execute a bond or 21-17 other security in an amount sufficient to secure from loss the 21-18 district funds that exceed the amount secured by the Federal 21-19 Deposit Insurance Corporation. 21-20 ARTICLE 7. BONDS 21-21 SECTION 7.01. GENERAL OBLIGATION BONDS. The board may issue 21-22 and sell bonds authorized by an election in the name and on the 21-23 faith and credit of the hospital district to: 21-24 (1) purchase, construct, acquire, repair, or renovate 21-25 buildings or improvements; 21-26 (2) equip buildings or improvements for hospital 21-27 purposes; or 22-1 (3) acquire and operate a mobile emergency medical or 22-2 air ambulance service. 22-3 SECTION 7.02. TAXES TO PAY BONDS. (a) At the time the 22-4 bonds are issued by the district, the board shall levy a tax. 22-5 (b) The tax must be sufficient to create an interest and 22-6 sinking fund to pay the principal of and interest on the bonds as 22-7 they mature. 22-8 (c) In any year, the tax together with any other tax the 22-9 district levies may not exceed the limit approved by the voters at 22-10 the election authorizing the levy of taxes. 22-11 SECTION 7.03. BOND ELECTION. (a) The district may issue 22-12 general obligation bonds only if the bonds are authorized by a 22-13 majority of the qualified voters of the district voting at an 22-14 election called and held for that purpose. 22-15 (b) The board may order a bond election. The order calling 22-16 the election must state the nature and date of the election, the 22-17 hours during which the polls will be open, the location of the 22-18 polling places, the amounts of bonds to be authorized, and the 22-19 maximum maturity of the bonds. 22-20 (c) Notice of a bond election shall be given as provided by 22-21 Article 704, Revised Statutes. 22-22 (d) The board shall canvass the returns and declare the 22-23 results of the election. 22-24 SECTION 7.04. REVENUE BONDS. (a) The board may issue bonds 22-25 to: 22-26 (1) purchase, construct, acquire, repair, equip, or 22-27 renovate buildings or improvements for hospital purposes, including 23-1 the purposes provided by Section 5.06 of this Act; 23-2 (2) acquire sites to be used for hospital purposes; or 23-3 (3) acquire and operate a mobile emergency medical or 23-4 air ambulance service to assist the district in carrying out its 23-5 hospital purpose. 23-6 (b) The bonds must be payable from and secured by a pledge 23-7 of all or part of the revenues derived from the operation of the 23-8 district's hospital system. The bonds may be additionally secured 23-9 by a mortgage or deed of trust lien on all or part of district 23-10 property. 23-11 (c) The bonds must be issued in the manner provided by 23-12 Sections 264.042, 264.043, 264.046, 264.047, 264.048, and 264.049, 23-13 Health and Safety Code, for issuance of revenue bonds by county 23-14 hospital authorities. 23-15 SECTION 7.05. REFUNDING BONDS. (a) Refunding bonds of the 23-16 district may be issued to refund and pay off any outstanding 23-17 indebtedness the district has issued or assumed. 23-18 (b) The bonds must be issued in the manner provided by 23-19 Chapter 784, Acts of the 61st Legislature, Regular Session, 1969 23-20 (Article 717k-3, Vernon's Texas Civil Statutes). 23-21 (c) The refunding bonds may be sold and the proceeds applied 23-22 to the payment of outstanding indebtedness or may be exchanged in 23-23 whole or in part for not less than a similar principal amount of 23-24 outstanding indebtedness. If the refunding bonds are to be sold 23-25 and the proceeds applied to the payment of outstanding 23-26 indebtedness, the refunding bonds must be issued and payments made 23-27 in the manner provided by Chapter 503, Acts of the 54th 24-1 Legislature, Regular Session, 1955 (Article 717k, Vernon's Texas 24-2 Civil Statutes). 24-3 SECTION 7.06. INTEREST AND MATURITY. District bonds must 24-4 mature not more than 50 years after the date of their issuance and 24-5 must bear interest at a rate not to exceed that provided by Chapter 24-6 3, Acts of the 61st Legislature, Regular Session, 1969 (Article 24-7 717k-2, Vernon's Texas Civil Statutes). 24-8 SECTION 7.07. EXECUTION OF BONDS. The president of the 24-9 board shall execute the bonds in the name of the district, and the 24-10 secretary of the board shall countersign the bonds in the manner 24-11 provided by the Texas Uniform Facsimile Signature of Public 24-12 Officials Act (Article 717j-1, Vernon's Texas Civil Statutes). 24-13 SECTION 7.08. APPROVAL AND REGISTRATION OF BONDS. (a) 24-14 District bonds are subject to the same requirements with regard to 24-15 approval by the attorney general and registration by the 24-16 comptroller of public accounts as the law provides for approval and 24-17 registration of bonds issued by counties. 24-18 (b) On approval by the attorney general and registration by 24-19 the comptroller of public accounts, the bonds are incontestable for 24-20 any cause. 24-21 SECTION 7.09. BONDS AS INVESTMENTS. District bonds and 24-22 indebtedness assumed by the district are legal and authorized 24-23 investments for: 24-24 (1) banks; 24-25 (2) savings banks; 24-26 (3) trust companies; 24-27 (4) savings and loan associations; 25-1 (5) insurance companies; 25-2 (6) fiduciaries; 25-3 (7) trustees; 25-4 (8) guardians; and 25-5 (9) sinking funds of cities, counties, school 25-6 districts, and other political subdivisions of the state and other 25-7 public funds of the state and its agencies, including the permanent 25-8 school fund. 25-9 SECTION 7.10. BONDS AS SECURITY FOR DEPOSITS. District 25-10 bonds are eligible to secure deposits of public funds of the state 25-11 and of cities, counties, school districts, and other political 25-12 subdivisions of the state. The bonds are lawful and sufficient 25-13 security for deposits to the extent of their value if accompanied 25-14 by all unmatured coupons. 25-15 SECTION 7.11. TAX STATUS OF BONDS. Since the district 25-16 created under this Act is a public entity performing an essential 25-17 public function, bonds issued by the district, any transaction 25-18 relating to the bonds, and profits made in the sale of the bonds 25-19 are free from taxation by the state or by any city, county, special 25-20 district, or other political subdivision of the state. 25-21 ARTICLE 8. TAXES 25-22 SECTION 8.01. LEVY OF TAXES. (a) The board may annually 25-23 levy taxes in an amount not to exceed the limit approved by the 25-24 voters at the election authorizing the levy of taxes. 25-25 (b) The tax rate for all purposes may not exceed 40 cents on 25-26 each $100 valuation of all taxable property in the district. 25-27 (c) The taxes may be used to pay: 26-1 (1) the indebtedness issued or assumed by the 26-2 district; and 26-3 (2) the maintenance and operating expenses of the 26-4 district. 26-5 (d) The district may not levy taxes to pay the principal of 26-6 or interest on revenue bonds issued under this Act. 26-7 SECTION 8.02. BOARD AUTHORITY. (a) The board may levy 26-8 taxes for the entire year in which the district is created. 26-9 (b) The board shall levy taxes on all property in the 26-10 district subject to hospital district taxation. 26-11 SECTION 8.03. SETTING OF TAX RATE. In setting the tax rate, 26-12 the board shall take into consideration the income of the district 26-13 from sources other than taxation. On determination of the amount 26-14 of tax required to be levied, the board shall make the levy and 26-15 certify it to the tax assessor-collector. 26-16 SECTION 8.04. TAX ASSESSMENT AND COLLECTION. (a) The Tax 26-17 Code governs the appraisal, assessment, and collection of district 26-18 taxes. 26-19 (b) The board may provide for the appointment of a tax 26-20 assessor-collector for the district or may contract for the 26-21 assessment and collection of taxes as provided by the Tax Code. 26-22 ARTICLE 9. DISSOLUTION OF DISTRICT 26-23 SECTION 9.01. DISSOLUTION ELECTION. The district may be 26-24 dissolved and its assets and liabilities sold or transferred to 26-25 another entity or person only if the dissolution and transfer are 26-26 approved by a majority of the qualified voters of the territory of 26-27 the district voting at an election called and held for that 27-1 purpose. 27-2 SECTION 9.02. ORDERING ELECTION. (a) A majority of the 27-3 directors may order an election to be held on the question of 27-4 dissolution of the district and the transfer of its assets and 27-5 liabilities. 27-6 (b) On presentation of a petition for a dissolution election 27-7 signed by at least 300 of the registered voters of the territory of 27-8 the district, according to the most recent official list of 27-9 registered voters, the directors shall order an election to be held 27-10 on the question of dissolution of the district and transfer of its 27-11 assets. The election shall be called not later than the 60th day 27-12 after the date the petition is presented to the district. 27-13 SECTION 9.03. ELECTION ORDER. The order calling the 27-14 election must state: 27-15 (1) the nature of the election, including the 27-16 proposition that is to appear on the ballot; 27-17 (2) the date of the election; 27-18 (3) the hours during which the polls will be open; and 27-19 (4) the location of the polling places. 27-20 SECTION 9.04. NOTICE. The directors shall give notice of 27-21 the election by publishing a substantial copy of the election order 27-22 in a newspaper with general circulation in the district once a week 27-23 for two consecutive weeks. The first publication must appear at 27-24 least 35 days before the date set for election. 27-25 SECTION 9.05. ELECTION DATE. (a) The election shall be 27-26 held not less than 45 days after the date on which the election is 27-27 ordered. 28-1 (b) Section 41.001(a), Election Code, does not apply to an 28-2 election ordered under this article. 28-3 SECTION 9.06. BALLOT PROPOSITION. The ballot for an 28-4 election at which the dissolution of the district is proposed shall 28-5 be printed to permit voting for or against the proposition: "The 28-6 dissolution of the West Community Hospital District and the 28-7 transfer of its assets and liabilities in the following manner: 28-8 ________________________ (insert provisions for transfer)." 28-9 SECTION 9.07. CANVASSING RETURNS. (a) The directors shall 28-10 canvass the returns of the election. 28-11 (b) If the directors find that the election results are 28-12 favorable to the proposition to dissolve the district and transfer 28-13 its assets and liabilities, they shall issue an order declaring the 28-14 district dissolved and shall proceed with the sale or transfer of 28-15 its assets and liabilities according to the plan proposed on the 28-16 ballot. 28-17 (c) If the directors find that the election results are not 28-18 favorable to the proposition to dissolve the district and transfer 28-19 its assets and liabilities, another dissolution election may not be 28-20 held before the first anniversary of the date of the election at 28-21 which voters disapproved the proposition. 28-22 SECTION 9.08. TRANSFER OF ASSETS. (a) Notwithstanding any 28-23 other provision of this article, the district may not be dissolved 28-24 unless the board provides for the sale or transfer of the 28-25 district's assets and liabilities to another entity or person. The 28-26 dissolution of the district and the sale or transfer of the 28-27 district's assets and liabilities may not contravene a trust 29-1 indenture or bond resolution relating to the outstanding bonds of 29-2 the district. In addition, the dissolution and sale or transfer 29-3 may not diminish or impair the rights of the holders of any 29-4 outstanding bonds, warrants, or other obligations of the district. 29-5 (b) The sale or transfer of the district's assets and 29-6 liabilities must satisfy the debt and bond obligations of the 29-7 district in a manner that protects the interests of the residents 29-8 of the district, including their collective property rights in the 29-9 district's assets. Any grant from federal funds is considered an 29-10 obligation to be repaid in satisfaction. The district may not 29-11 transfer or dispose of the district's assets except for due 29-12 compensation unless the transfer is made to another governmental 29-13 agency embracing the district and using the transferred assets for 29-14 the benefit of residents formerly in the district. 29-15 ARTICLE 10. MISCELLANEOUS 29-16 SECTION 10.01. LIMITATION ON STATE ASSISTANCE. The state 29-17 may not become obligated for the support or maintenance of a 29-18 hospital district created under this Act, nor may the legislature 29-19 make a direct appropriation for the construction, maintenance, or 29-20 improvement of a facility of the district. 29-21 SECTION 10.02. EMERGENCY. The importance of this 29-22 legislation and the crowded condition of the calendars in both 29-23 houses create an emergency and an imperative public necessity that 29-24 the constitutional rule requiring bills to be read on three several 29-25 days in each house be suspended, and this rule is hereby suspended, 29-26 and that this Act take effect and be in force from and after its 29-27 passage, and it is so enacted.