1-1  By:  Haley                                            S.B. No. 1379
    1-2        (In the Senate - Filed April 15, 1993; April 19, 1993, read
    1-3  first time and referred to Committee on Intergovernmental
    1-4  Relations; April 22, 1993, reported favorably, as amended, by the
    1-5  following vote:  Yeas 9, Nays 0; April 22, 1993, sent to printer.)
    1-6                            COMMITTEE VOTE
    1-7                          Yea     Nay      PNV      Absent 
    1-8        Armbrister         x                               
    1-9        Leedom             x                               
   1-10        Carriker           x                               
   1-11        Henderson                                       x  
   1-12        Madla              x                               
   1-13        Moncrief           x                               
   1-14        Patterson          x                               
   1-15        Rosson             x                               
   1-16        Shapiro            x                               
   1-17        Wentworth          x                               
   1-18        Whitmire                                        x  
   1-19  COMMITTEE AMENDMENT NO. 1                           By:  Armbrister
   1-20  Amend S.B. No. 1379, page 5, line 35, by inserting the following
   1-21  section and renumbering all sections accordingly:
   1-22        SECTION 9.  The legislature hereby declares that the
   1-23  enactment of this Act is in fulfillment of authority conferred on
   1-24  it by Article IX, Section 9, of the Texas Constitution; that the
   1-25  Montgomery County Hospital District and the indigent health care
   1-26  services and other health care services and facilities that it is
   1-27  able to provide or arrange for the provision of are essential to
   1-28  and operate on a subject in which the state and public at large are
   1-29  interested; and that the provisions of this Act therefore operate
   1-30  on a subject in which the state and the public are interested.  All
   1-31  the terms and provisions of this Act are to be liberally construed
   1-32  to effectuate the purposes set forth herein.
   1-33                         A BILL TO BE ENTITLED
   1-34                                AN ACT
   1-35  relating to the Montgomery County Hospital District.
   1-36        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
   1-37        SECTION 1.  Sections 2 and 5, Chapter 258, Acts of the 65th
   1-38  Legislature, Regular Session, 1977, are amended to read as follows:
   1-39        Sec. 2.  The district shall take over and there shall be
   1-40  transferred to it title to all land, buildings, improvements, and
   1-41  equipment pertaining to the hospitals or hospital system owned by
   1-42  the county or any city or town within the boundaries of the
   1-43  proposed district and shall provide for the establishment of a
   1-44  health care or hospital system by the purchase, gift, construction,
   1-45  acquisition, repair, or renovation of buildings and equipment and
   1-46  equipping same and the administration of the system for health care
   1-47  or hospital purposes.  The district may take over and may accept
   1-48  title to land, buildings, improvements, and equipment of a
   1-49  nonprofit hospital within the district if the governing authority
   1-50  or authorities of the hospital and district agree to the transfer.
   1-51  The district shall assume the outstanding indebtedness incurred by
   1-52  any city or town within the district or by the county for hospital
   1-53  purposes within the boundaries of the district.
   1-54        Sec. 5.  (a)  The board of directors shall manage, control,
   1-55  and administer the health care or hospital system and all funds and
   1-56  resources of the district, but in no event shall any operating,
   1-57  depreciation, or building reserves be invested in any funds or
   1-58  securities other than those specified in Article 836 or 837,
   1-59  Revised Civil Statutes of Texas, 1925, as amended.  The district,
   1-60  through its board of directors, shall have the power and authority
   1-61  to sue and be sued, to promulgate rules governing the operation of
   1-62  the hospital, the health care or hospital system, its staff, and
   1-63  its employees.  The board of directors shall appoint a qualified
   1-64  person as the chief administrative officer of the district to be
   1-65  known as the president of the hospital district or by another title
   1-66  selected by the board.  The board may appoint assistants to the
   1-67  chief administrative officer to be known as vice-presidents of the
   1-68  hospital district or by another title selected by the board.  The
    2-1  chief administrative officer and any assistant shall serve at the
    2-2  will of the board and shall receive such compensation as may be
    2-3  fixed by the board.  The chief administrative officer shall
    2-4  supervise all the work and activities of the district and shall
    2-5  have general direction of the affairs of the district, subject to
    2-6  limitations prescribed by the board.  The board of directors shall
    2-7  have the authority to appoint to the staff such doctors as
    2-8  necessary for the efficient operation of the district and may
    2-9  provide for temporary appointments to the staff if warranted by
   2-10  circumstances.  The board may delegate to the chief administrative
   2-11  officer the authority to employ technicians, nurses, and employees
   2-12  of the district.  The board shall be authorized to contract with
   2-13  any other political subdivision or governmental agency whereby the
   2-14  district will provide investigatory or other services as to the
   2-15  medical, health care, hospital, or welfare needs of the inhabitants
   2-16  of the district and shall be authorized to contract with any county
   2-17  or incorporated municipality located outside its boundaries for the
   2-18  care and treatment of the sick, diseased, or injured persons of any
   2-19  such county or municipality and shall have the authority to
   2-20  contract with the State of Texas or agencies of the federal
   2-21  government for the treatment of sick, diseased, or injured persons.
   2-22        (b)  The district may enter into contracts, and make payments
   2-23  thereunder, relating to or arranging for the provision of health
   2-24  care services as permitted by the Texas Constitution and Chapter
   2-25  61, Health and Safety Code, and its subsequent amendments, on terms
   2-26  and conditions as the board of directors determines to be in the
   2-27  best interests of the district.  The term of a contract entered
   2-28  into under this subsection may not exceed 15 years.
   2-29        SECTION 2.  Subsection (a), Section 8, Chapter 258, Acts of
   2-30  the 65th Legislature, Regular Session, 1977, is amended to read as
   2-31  follows:
   2-32        (a)  The board of directors shall have the power and
   2-33  authority to issue and sell its bonds in the name and on the faith
   2-34  and credit of the hospital district for the purchase, construction,
   2-35  acquisition, repair, or renovation of buildings and improvements
   2-36  and equipping the same for health care or hospital purposes, and
   2-37  for any or all such purposes.  At the time of the issuance of any
   2-38  bonds by the district, a tax shall be levied by the board
   2-39  sufficient to create an interest and sinking fund to pay the
   2-40  interest on and principal of said bonds as same mature; providing
   2-41  the tax together with any other taxes levied for the district shall
   2-42  not exceed 75 cents on each $100 valuation of all taxable property
   2-43  situated in the district subject to hospital district taxation in
   2-44  any one year.  No bonds shall be issued by such hospital district
   2-45  except refunding bonds until authorized by a majority of the
   2-46  electors of the district.  The order for bond election shall
   2-47  specify the date of the election, the amount of bonds to be
   2-48  authorized, the maximum maturity of the bonds, the place or places
   2-49  where the election shall be held, the presiding judge and alternate
   2-50  judge for each voting place, and provide for clerks as in county
   2-51  elections.  Notice of any bond election except one held under the
   2-52  provisions of Section 9 of this Act, in which instance notice shall
   2-53  be given as provided in Section 3 of this Act, shall be given as
   2-54  provided in Article 704, Revised Civil Statutes of Texas, 1925, as
   2-55  amended, and shall be conducted in accordance with the Texas
   2-56  Election Code, as amended, except as modified by the provisions of
   2-57  this Act.
   2-58        SECTION 3.  Sections 10 and 11, Chapter 258, Acts of the 65th
   2-59  Legislature, Regular Session, 1977, are amended to read as follows:
   2-60        Sec. 10.  In addition to the power to issue bonds payable
   2-61  from taxes levied by the district, as contemplated by Section 8 of
   2-62  this Act, the board of directors is further authorized to issue and
   2-63  to refund any previously issued revenue bonds for purchasing,
   2-64  constructing, acquiring, repairing, equipping, or renovating
   2-65  buildings and improvements for health care or hospital purposes and
   2-66  for acquiring sites for health care or hospital purposes, the bonds
   2-67  to be payable from and secured by a pledge of all or any part of
   2-68  the revenues of the district to be derived from the operation of
   2-69  its hospital or health care facilities <hospitals>.  The bonds may
   2-70  be additionally secured by a mortgage or deed of trust lien on any
    3-1  part or all of its properties.  The bonds shall be issued in the
    3-2  manner and in accordance with the procedures and requirements
    3-3  specified for the issuance of revenue bonds by county hospital
    3-4  authorities in Sections 8 and 10 through 13 of Chapter 122, Acts of
    3-5  the 58th Legislature, 1963 (Article 4494r, Vernon's Texas Civil
    3-6  Statutes).
    3-7        Sec. 11.  (a)  The board of directors is hereby given
    3-8  complete discretion as to the type of buildings, both as to number
    3-9  and location, required to establish and maintain an adequate health
   3-10  care or hospital system.  The health care or hospital system may
   3-11  include domiciliary care and treatment of the sick, wounded, and
   3-12  injured, hospitals, outpatient clinic or clinics, dispensaries,
   3-13  geriatric domiciliary care and treatment, convalescent home
   3-14  facilities, necessary nurses, domiciliaries and training centers,
   3-15  blood banks, community mental health centers and research centers
   3-16  or laboratories, ambulance services, and any other facilities
   3-17  deemed necessary for health or hospital care by the directors.  The
   3-18  district, through its board of directors, is further authorized to
   3-19  enter into an operating or management contract with regard to its
   3-20  facilities or a part thereof or may lease all or part of its
   3-21  buildings and facilities on terms and conditions considered to be
   3-22  to the best interest of its inhabitants.  Except as provided by
   3-23  Subsection (c) of Section 15 of this Act, the term of a<; provided
   3-24  that in no event shall any> lease may not exceed <be for a period
   3-25  in excess of> 25 years from the date entered.  The district shall
   3-26  be empowered to sell or otherwise dispose of any property, real or
   3-27  personal, or equipment of any nature on terms and conditions found
   3-28  by the board to be in the best interest of its inhabitants.
   3-29        (b)  The district may sell or exchange a hospital, including
   3-30  real property necessary or convenient for the operation of the
   3-31  hospital and real property that the board of directors finds may be
   3-32  useful in connection with future expansions of the hospital, on
   3-33  terms and conditions the board determines to be in the best
   3-34  interests of the district, by complying with the procedures
   3-35  prescribed by Sections 285.051 and 285.052, Health and Safety Code,
   3-36  and any subsequent amendments.
   3-37        (c)  The board of directors of the district shall have the
   3-38  power to prescribe the method and manner of making purchases and
   3-39  expenditures by and for the hospital district and shall also be
   3-40  authorized to prescribe all accounting and control procedures.  All
   3-41  contracts for construction involving the expenditure of more than
   3-42  $10,000 may be made only after advertising in the manner provided
   3-43  by Chapter 163, Acts of the 42nd Legislature, Regular Session,
   3-44  1931, as amended (Article 2368a, Vernon's Texas Civil Statutes).
   3-45  The provisions of Article 5160, Revised Civil Statutes of Texas,
   3-46  1925, as amended, relating to performance and payment bonds shall
   3-47  apply to construction contracts let by the district.  The district
   3-48  may acquire equipment for use in its health care or hospital system
   3-49  and mortgage or pledge the property so acquired as security for the
   3-50  payment of the purchase price, but any such contract shall provide
   3-51  for the entire obligation of the district to be retired within five
   3-52  years from the date of the contract.  Except as permitted in the
   3-53  preceding sentence and as permitted by Sections 5, 8, 9, and 10 of
   3-54  this Act, the district may incur no obligation payable from any
   3-55  revenues of the district, except those on hand or to be on hand
   3-56  within the then current and following fiscal year of the district.
   3-57        (d) <(c)>  The board may declare an emergency in the matter
   3-58  of funds not being available to pay principal of and interest on
   3-59  any bonds of the district payable in whole or in part from taxes or
   3-60  to meet any other needs of the district and may issue negotiable
   3-61  tax anticipation notes to borrow the money needed by the district.
   3-62  Tax anticipation notes may bear interest at any rate or rates
   3-63  authorized by general law and must mature within one year of their
   3-64  date.  Tax anticipation notes may be issued for any purpose for
   3-65  which the district is authorized to levy taxes, and tax
   3-66  anticipation notes shall be secured with the proceeds of taxes to
   3-67  be levied by the district in the succeeding 12-month period.  The
   3-68  board may covenant with the purchasers of the notes that the board
   3-69  will levy a sufficient tax in the following fiscal year to pay
   3-70  principal of and interest on the notes and pay the costs of
    4-1  collecting the taxes.
    4-2        SECTION 4.  Subsections (c) and (d), Section 15, Chapter 258,
    4-3  Acts of the 65th Legislature, Regular Session, 1977, are amended to
    4-4  read as follows:
    4-5        (c)  Land owned by the district may not be leased for a
    4-6  period greater than 25 years <or sold> unless the board of
    4-7  directors:
    4-8              (1)  finds that the land is not necessary for health
    4-9  care or hospital purposes;
   4-10              (2)  complies with any indenture securing the payment
   4-11  of bonds issued by the district; and
   4-12              (3)  receives on behalf of the district not less than
   4-13  the current market value for the <sale or> lease.
   4-14        (d)  Land <In addition to the requirements under Subsection
   4-15  (c) of this section, land> of the district, other than land that
   4-16  the district is authorized to sell or exchange under Subsection (b)
   4-17  of Section 11 of this Act, may not be sold unless the board of
   4-18  directors complies with Section 272.001, Local Government Code
   4-19  <Chapter 455, Acts of the 61st Legislature, Regular Session, 1969
   4-20  (Article 5421c-12, Vernon's Texas Civil Statutes)>.
   4-21        SECTION 5.  Section 18, Chapter 258, Acts of the 65th
   4-22  Legislature, Regular Session, 1977, is amended to read as follows:
   4-23        Sec. 18.  Whenever a patient residing within the district has
   4-24  been admitted to the facilities of the district, the chief
   4-25  administrative officer may cause inquiry to be made as to his
   4-26  circumstances and those of the relatives of the patient legally
   4-27  liable for his support.  If he finds that the patient or his
   4-28  relatives are able to pay for his care and treatment in whole or in
   4-29  part, an order shall be made directing the patient or his relatives
   4-30  to pay to the hospital district for the care and support of the
   4-31  patient a specified sum per week in proportion to their financial
   4-32  ability.  The chief administrative officer shall have the power and
   4-33  authority to collect these sums from the estate of the patient or
   4-34  his relatives legally liable for his support in the manner provided
   4-35  by law for collection of expenses in the last illness of a deceased
   4-36  person.  If the chief administrative officer finds that the patient
   4-37  or his relatives are not able to pay either in whole or in part for
   4-38  his care and treatment in the facilities of the district
   4-39  <hospital>, same shall become a charge on the hospital district as
   4-40  to the amount of the inability to pay.  Should there be any dispute
   4-41  as to the ability to pay or doubt in the mind of the chief
   4-42  administrative officer, the board of directors shall hear and
   4-43  determine same after calling witnesses and shall make such order or
   4-44  orders as may be proper.  Appeals from a final order of the board
   4-45  shall lie to the district court.  The substantial evidence rule
   4-46  shall apply.
   4-47        SECTION 6.  Chapter 258, Acts of the 65th Legislature,
   4-48  Regular Session, 1977, is amended by adding Section 19A to read as
   4-49  follows:
   4-50        Sec. 19A.  (a)  The district may sponsor and create a
   4-51  nonstock, nonmember corporation under the Texas Non-Profit
   4-52  Corporation Act (Article 1396-1.01 et seq., Vernon's Texas Civil
   4-53  Statutes) and its subsequent amendments and may contribute or cause
   4-54  to be contributed available funds to the corporation.
   4-55        (b)  The funds of the corporation, other than funds paid by
   4-56  the corporation to the district, may be used by the corporation
   4-57  only to provide, to pay the costs of providing, or to pay the costs
   4-58  related to providing indigent health care or other services that
   4-59  the district is required or permitted to provide under the
   4-60  constitution or laws of this state.  The board of directors of the
   4-61  hospital district shall establish adequate controls to ensure that
   4-62  the corporation uses its funds as required by this subsection.
   4-63        (c)  The board of directors of the corporation shall be
   4-64  composed of seven residents of the district appointed by the board
   4-65  of directors of the district.   The board of directors of the
   4-66  district may remove any director of the corporation at any time
   4-67  with or without cause.
   4-68        (d)  The corporation may invest funds in any investment in
   4-69  which the district is authorized to invest funds of the district,
   4-70  including investments authorized by the Public Funds Investment Act
    5-1  of 1987 (Article 842a-2, Vernon's Texas Civil Statutes) and its
    5-2  subsequent amendments.
    5-3        SECTION 7.  Section 20, Chapter 258, Acts of the 65th
    5-4  Legislature, Regular Session, 1977, is amended to read as follows:
    5-5        Sec. 20.  After creation of the hospital district, no county,
    5-6  municipality, or political subdivision wholly or partly within the
    5-7  boundaries of the district shall have the power to levy taxes or
    5-8  issue bonds or other obligations for hospital or health care
    5-9  purposes or for providing medical care for the residents of the
   5-10  district.  The hospital district shall assume full responsibility
   5-11  for <the operation of all hospital facilities for> the furnishing
   5-12  of medical and hospital care for its needy inhabitants.  When the
   5-13  district is created and established, the county and all towns and
   5-14  cities located wholly or partly therein shall convey and transfer
   5-15  to the district title to all land, buildings, improvements, and
   5-16  equipment in anywise pertaining to a hospital or hospital system
   5-17  located wholly within the district which may be jointly or
   5-18  separately owned by the county or any city or town within the
   5-19  district.  Operating funds and reserves for operating expenses
   5-20  which are on hand and funds which have been budgeted for hospital
   5-21  purposes by the county or any city or town therein for the
   5-22  remainder of the fiscal year in which the district is created shall
   5-23  likewise be transferred to the district, as shall taxes previously
   5-24  levied for hospital purposes for the current year, and all sinking
   5-25  funds established for payment of indebtedness assumed by the
   5-26  district.
   5-27        SECTION 8.  The legislature finds that all of the
   5-28  requirements of the Texas Constitution have been performed or
   5-29  accomplished as required, and in the time and order required, and
   5-30  that the legislature has the power and authority to enact this Act.
   5-31        SECTION 9.  The importance of this legislation and the
   5-32  crowded condition of the calendars in both houses create an
   5-33  emergency and an imperative public necessity that the
   5-34  constitutional rule requiring bills to be read on three several
   5-35  days in each house be suspended, and this rule is hereby suspended,
   5-36  and that this Act take effect and be in force from and after its
   5-37  passage, and it is so enacted.
   5-38                               * * * * *
   5-39                                                         Austin,
   5-40  Texas
   5-41                                                         April 22, 1993
   5-42  Hon. Bob Bullock
   5-43  President of the Senate
   5-44  Sir:
   5-45  We, your Committee on Intergovernmental Relations to which was
   5-46  referred S.B. No. 1379, have had the same under consideration, and
   5-47  I am instructed to report it back to the Senate with the
   5-48  recommendation that it do pass, as amended, and be printed.
   5-49                                                         Armbrister,
   5-50  Chairman
   5-51                               * * * * *
   5-52                               WITNESSES
   5-53                                                  FOR   AGAINST  ON
   5-54  ___________________________________________________________________
   5-55  Name:  David Crews                               x
   5-56  Representing:  Self
   5-57  City:  Conroe
   5-58  -------------------------------------------------------------------
   5-59  Name:  Walter Jolley                             x
   5-60  Representing:  Medical Center Hosp.
   5-61  City:  The Woodlands
   5-62  -------------------------------------------------------------------
   5-63  Name:  Rigby Owen Jr.                            x
   5-64  Representing:  Mont. Co. Hosp. Dist.
   5-65  City:  Montgomery
   5-66  -------------------------------------------------------------------
   5-67                                                  FOR   AGAINST  ON
   5-68  ___________________________________________________________________
   5-69  Name:  Jerry Alan Wood                           x
   5-70  Representing:  City of Houston
    6-1  City:  Houston
    6-2  -------------------------------------------------------------------