BILL ANALYSIS
S.B. 1627
By: Sibley
Intergovernmental Relations
4-18-95
Committee Report (Unamended)
BACKGROUND
Currently, Comanche County is served by two hospital districts, the
DeLeon Hospital District and the Comanche County Hospital District.
A single, county-wide district would eliminate unnecessary
duplication of services, thus providing more efficient and economic
delivery of health care services to residents of these communities.
The current rates for the DeLeon and Comanche County Hospital
Districts are, respectively, 75 cents and 30 cents per 100 dollars
of valuation.
PURPOSE
As proposed, S.B. 1627 sets forth provisions relating to the
dissolution of the DeLeon Hospital District and the Comanche County
Hospital District and the creation of the Leon Valley Hospital
District.
RULEMAKING AUTHORITY
It is the committee's opinion that rulemaking authority is granted
to the board of directors of the Leon Valley Hospital District
under SECTION 3.09(b) of this bill.
SECTION BY SECTION ANALYSIS
ARTICLE 1. CHANGES RELATING TO DELEON HOSPITAL DISTRICT
SECTION 1.01. Amends Chapter 202, Acts of the 63rd Legislature,
Regular Session, 1973, by adding Section 21A, as follows:
Sec. 21A. DISSOLUTION OF DISTRICT IN EVENT OF DISSOLUTION OF
COMANCHE COUNTY HOSPITAL DISTRICT AND CREATION OF LEON VALLEY
HOSPITAL DISTRICT. (a) Authorizes the DeLeon Hospital
District to be dissolved as provided by this section.
(b) Authorizes the board of directors to order an election
on the question of the dissolution of the DeLeon Hospital
District (DeLeon District), creation of the Leon Valley
Hospital District (Leon Valley District), transfer of the
DeLeon Hospital District's assets and obligations to the
Leon Valley Hospital District, and assumption by the Leon
Valley Hospital District of the DeLeon Hospital District's
outstanding debts.
(c) Requires the board to order an election if the board of
the Comanche County Hospital District (Comanche District)
orders an election or the board receives a petition
requesting an election on the question of dissolution and
transfer of assets that is signed by at least 50 registered
voters in the DeLeon District.
(d) Requires the board, if it orders an election, to notify
the board of the Comanche District of the election order.
(e) Requires the election to be held within a certain
period and on the same date that the separate election in
the Comanche District is held. Requires the board to
cooperate with the board of the Comanche District in setting
election dates. Provides that Section 41.001(a), Election
Code, does not apply to an election ordered under this
section.
(f) Sets forth the required language for the ballot.
(g) Requires the election to be held in accordance with the
applicable provisions of the Election Code, except as
provided by Subsections (e) and (f) of this section.
(h) Provides that the DeLeon District is dissolved if a
majority of the voters in the DeLeon District vote in an
election in favor of a proposition and if a majority of the
voters in the Comanche District vote in favor of the
dissolution of the Comanche District, creation of the Leon
Valley District, the transfer of assets of the Comanche
District to the Leon Valley District, and the assumption of
the assets and obligations of the Comanche District by the
Leon Valley District in an election held under this section.
(i) Provides that the DeLeon District is not dissolved and
requires the board to continue to administer the DeLeon
District if a majority of voters in either the DeLeon
Hospital District or the Comanche District do not favor the
proposition on which they voted.
(j) Requires the board to transfer the assets and
obligations of the DeLeon District to the Leon Valley
District if the DeLeon District is dissolved.
(k) Prohibits the board from ordering another election on
the question of dissolution before the first anniversary of
the date of the most recent election at which voters of
either district disapproved the proposition on which they
voted.
SECTION 1.02. Amends Chapter 202, Acts of the 63rd Legislature,
Regular Session, 1973, by adding Section 1B, to provide that a
reference in this Act or any other law to the DeLeon District means
the Leon Valley District on the dissolution of the DeLeon District
and the approval of the creation of the Leon Valley District.
ARTICLE 2. CHANGES RELATING TO COMANCHE COUNTY HOSPITAL DISTRICT
SECTION 2.01. Amends Chapter 203, Acts of the 63rd Legislature,
Regular Session, 1973, by adding Section 21A, as follows:
Sec. 21A. DISSOLUTION OF DISTRICT IN EVENT OF DISSOLUTION OF
DELEON HOSPITAL DISTRICT AND CREATION OF LEON VALLEY HOSPITAL
DISTRICT. (a) Authorizes the Comanche District to be
dissolved as provided by this section.
(b) Authorizes the board to order an election on the question
of the dissolution of the Comanche District, creation of the
Leon Valley District, transfer of the Comanche District's
assets and obligations to the Leon Valley District, and the
assumption by Leon Valley District of the Comanche District's
outstanding debts.
(c) Requires the board to order an election if the board of
the DeLeon District orders an election or the board receives
a petition requesting an election on the questions of
dissolution and transfer of assets that is signed by at least
50 registered voters in the Comanche District.
(d) Requires the board, if it orders an election, to notify
the board of the Comanche District of the election order.
(e) Requires the election to be held within a certain period
and to be held on the same date that the separate election in
the DeLeon District is held. Requires the board to cooperate
with the board of the DeLeon District in setting election
dates. Provides that Section 41.001(a), Election Code, does
not apply to an election ordered under this section.
(f) Sets forth the required language for the ballot.
(g) Requires the election to be held in accordance with the
applicable provisions of the Election Code, except as provided
by Subsections (e) and (f) of this section.
(h) Provides that the Comanche District is dissolved if a
majority of the voters in the Comanche District vote in an
election in favor of a proposition and if a majority of the
voters in the DeLeon District vote in favor of the dissolution
of the DeLeon District, creation of the Leon Valley District,
the transfer of assets of the DeLeon District to the Leon
Valley District, and the assumption of the assets and
obligations of the DeLeon District by the Leon Valley District
in an election held under this section.
(i) Provides that the Comanche District is not dissolved and
requires the board to continue to administer the Comanche
District if a majority of voters in either district do not
favor the proposition on which they voted.
(j) Requires the board to transfer the assets and obligations
of the DeLeon District to the Leon Valley District if the
DeLeon District is dissolved.
(k) Prohibits the board from ordering another election on the
question of dissolution before the first anniversary of the
date of the most recent election at which voters of either
district disapproved the proposition on which they voted.
SECTION 2.02. Amends Chapter 203, Acts of the 63rd Legislature,
Regular Session, 1973, by adding Section 1A, to provide that a
reference in this Act or in any other law to the Comanche District
means the Leon Valley District on the dissolution of the Comanche
District and the approval of the creation of the Leon Valley
District.
ARTICLE 3. CREATION OF LEON VALLEY HOSPITAL DISTRICT
SECTION 3.01. (a) Provides that this Act authorizes, in
accordance with the provisions of Section 9, Article IX, Texas
Constitution, the creation, establishment, administration,
maintenance, operation, and financing of a hospital district with
boundaries coextensive with the boundaries as they existed on
August 10, 1992. Sets forth the boundaries of the district.
(b) Provides that the district is to be known as "Leon Valley
Hospital District," and has the rights, powers, and duties as
provided in this Act.
SECTION 3.02. (a) Prohibits the Leon Valley District from being
created unless the creation, the assumption of debt, and the levy
of taxes are approved by a majority of the voters at an election
held in the DeLeon District and by a majority of the voters at a
separate election held in the Comanche District.
(b) Requires the election in the DeLeon District and the
election in the Comanche District to be held on the same day
and held before the fifth anniversary of the effective date of
this Act.
SECTION 3.03. (a) Designates certain named persons to serve as
temporary directors of the Leon Valley District if the Leon Valley
District is created.
(b) Requires a vacancy on the temporary board to be filled by
the commissioners court of Comanche County.
(c) Requires the board to serve as the directors of the Leon
Valley District until elected directors take office.
SECTION 3.04. (a) Requires directors to be elected at an election
to be held on the first Saturday in May following the date the Leon
Valley District is created.
(b) Authorizes the temporary directors to postpone the
election date for one year or until a subsequent uniform
election date if there is not sufficient time to comply with
the requirements of law.
(c) Requires one director to be elected from each
Commissioners Precinct Numbers 1, 2, 3, and 4 of Comanche
County and one director from the district at-large.
(d) Provides that the candidate receiving the highest number
of votes at the initial election of director following
creation of the Leon Valley District is the director for the
precinct or is director at-large.
(e) Requires the directors elected at the initial election of
directors following creation of the Leon Valley District to
draw lots to determine which three directors must serve one-year terms and which two directors must serve two-year terms.
SECTION 3.05. (a) Requires an election to be held each year on
the first Saturday in May, and the appropriate number of successor
directors to be elected for two-year terms after the initial
election of directors following creation.
(b) Requires notice of each election to be published in a
newspaper of general circulation in the district one time at
least 36 days before the date of the election. Requires any
person desiring to have his or her name printed on the ballot
as a candidate for director to file an application with the
secretary at least 31 days before the date of the election.
Requires the application to specify the commissioners precinct
the candidate wishes to represent or that the candidate wishes
to represent the district at-large.
(c) Requires vacancies in office to be filled for the
unexpired term by the remainder of the board.
SECTION 3.06. Prohibits a person from being appointed or elected
as a member of the temporary or permanent board unless the person
is a resident of the district, a qualified voter, and if elected
from a commissioners precinct, a resident of the precinct.
Provides that neither the administrator nor any other employee of
the district is eligible to serve as a director.
SECTION 3.07. (a) Requires the created district to take over and
be transferred to the district title to all land, building,
improvements, and equipment pertaining to the hospitals or hospital
system that may be located wholly within the district and owned by
Comanche County or a municipality in the district. Requires the
district to provide for the establishment of a hospital system.
(b) Requires the district to assume the outstanding
indebtedness incurred by Comanche County or any city or town
in the district to provide medical care for residents of the
district before the creation of the district.
SECTION 3.08. (a) Sets forth the composition of the board.
Requires officers to be elected for one-year terms and vacancies to
be filled for the unexpired term by the board.
(b) Requires a majority of the members of the board voting to
concur in a matter pertaining to the business of the district.
(c) Requires all board members and officers to serve without
compensation, but may be reimbursed for actual expenses
incurred while performing official duties on the approval of
the expenses by the board and reported in a minute book of the
district or other district records.
SECTION 3.09. (a) Requires the board to manage, control, and
administer the hospital system and the business of and all funds
and resources of the district. Prohibits operating, depreciation,
or building reserves from being invested in any funds or securities
other than those specified in Articles 836 and 837, V.T.C.S.
(b) Authorizes the district, through its board, to sue and be
sued and to adopt rules governing the operation of the
hospital, hospital system, and the district's staff and
employees.
(c) Provides that the board may appoint a qualified person as
the administrator of the hospital district and may appoint an
assistant to the administrator. Provides that the
administrator and assistant administrator serve at the will of
the board and receive compensation as may be fixed by the
board. Requires the administrator to execute a bond payable
to the hospital district in an amount set by the board, but
not less than $5,000, conditioned on the faithful performance
of the duties required of the administrator and containing
other conditions as the board may require. Authorizes the
board to pay for the bond with district funds. Requires the
administrator to supervise all the work and activities of the
district, subject to the limitations prescribed by the board.
(d) Requires the board to have the authority to appoint to
the staff any doctors the board considers necessary for the
efficient operation of the district if warranted by
circumstances. Requires the board to have the authority to
employ and may delegate to the administrator the authority to
employ persons for the district.
(e) Authorizes the board to contract with any other political
subdivision or governmental agency for the district to provide
investigatory or other services as to the medical, hospital,
or welfare needs of the residents of the district. Authorizes
the district to contract with any county or municipality
located outside the district's boundaries for the care and
treatment of the sick, diseased, or injured persons of the
county or municipality, and to contract with the state or
federal agencies for the state or federal government to
reimburse the district for the treatment of the sick,
diseased, or injured persons.
SECTION 3.10. (a) Requires the district to operate on the basis
of fiscal years established from time to time by the board,
provided that a fiscal year may not be changed during the time
revenue bonds of the district are outstanding or more than once in
any 24-month period.
(b) Requires the board to cause an annual audit to be made of
the financial condition of the district which is required to
be open to inspection at the principal office of the district.
(c) Requires the administrator to prepare an annual budget
for approval by the board. Requires the budget to contain a
complete financial statement of the district showing certain
information.
(d) Requires a public hearing on the annual budget to be held
by the board after notice of the hearing has been published
one time in a newspaper of general circulation in the district
at least 10 days before the date set for the hearing.
Requires any person residing in the district to have the right
to be present and participate in the hearing.
(e) Requires the budget, as proposed by the administrator, to
be acted on by the board. Provides that the board has the
authority to make changes in the budget.
(f) Prohibits an expenditure from being made for any expense
not included in the annual budget or in an amendment to the
budget.
(g) Authorizes the annual budget to be amended from time to
time as the circumstances require, but the annual budget, and
all amendments to the budget, must be approved by the board.
(h) Requires the administrator to prepare for the board a
sworn statement of all money belonging to the district as soon
as practicable after the close of each fiscal year.
SECTION 3.11. (a) Requires the board to have the power and
authority to issue and sell bonds in the name and on the faith and
credit of the hospital district for certain purchases and
improvements.
(b) Requires a tax to be levied, at the time bonds are issued
by the district, by the board sufficient to create an interest
and sinking fund to pay the interest on and principal of the
bonds as the bonds mature, provided that the tax together with
any other taxes levied for the district do not exceed the
limit approved by the voters at the election authorizing the
levy of taxes.
(c) Prohibits the bonds from being issued by the hospital
district except for refunding bonds until authorized by a
majority of the electors of the district.
(d) Requires the order for a bond election to specify certain
information.
(e) Requires notice of a bond election to be given as
provided in Article 704, V.T.C.S., and to be conducted in
accordance with the Election Code, except as modified by the
provisions of this Act.
SECTION 3.12. (a) Authorizes refunding bonds of the district to
be issued for the purpose of refunding and paying off any
outstanding indebtedness the district has issued or assumed.
(b) Authorizes refunding bonds to be sold and the proceeds
from the bonds to be applied to the payment of outstanding
indebtedness or to be exchanged in whole or in part for not
less than a similar principal amount of the outstanding
indebtedness.
(c) Requires refunding bonds to be issued and payments made
in the manner specified by Chapter 503, Article 717k,
V.T.C.S., if the refunding bonds are to be sold and the
proceeds from the bonds are to be applied to the payment of
any outstanding indebtedness.
(d) Requires refunding bonds to be issued in conformity with
Chapter 784, Article 717k-3, V.T.C.S..
SECTION 3.13. (a) Requires bonds issued by the district to meet
certain requirements.
(b) Requires bonds, on approval by the attorney general and
registration by the comptroller, to be incontestable for any
cause.
SECTION 3.14. (a) Authorizes the board to issue and refund any
previously issued revenue bond to purchase or acquire certain
equipment, facilities, or services.
(b) Requires bonds authorized under this section to be
payable from and secured by a pledge of all or any part of the
revenues of the district to be derived from the operation of
the district's hospital system. Authorizes the bonds to be
additionally secured by a mortgage or deed of trust lien on
any part or all of the district's properties.
(c) Requires bonds to be issued in the manner and in
accordance with the procedures and requirements specified for
the issuance of revenue bonds by a county hospital authority
under Chapter 264, Health and Safety Code.
SECTION 3.15. (a) Provides that the board has complete discretion
as to the type of buildings required to establish and maintain an
adequate hospital system and the type of equipment necessary for
hospital care. Authorizes the hospital system to include certain
types of health care services and facilities.
(b) Authorizes the district, through its board, to enter into
an operating or management contract with regard to all or part
of the district's facilities on terms and conditions
considered to be in the best interest of the residents of the
district. Prohibits a lease under this section from being for
a period that exceeds the 25th anniversary of the date the
lease was entered.
(c) Authorizes the district to sell or otherwise dispose of
any property or equipment of any nature on terms and
conditions found by the board to be in the best interest of
the residents of the district.
(d) Authorizes the board of the district to prescribe the
method and manner of making purchases and expenditures by and
for the hospital district and to prescribe all accounting and
control procedures.
(e) Authorizes a contract for construction involving the
expenditure of more than $10,000 to be made only after
competitive bidding as provided by Chapter 271B, Local
Government Code.
(f) Provides that the provisions of Chapter 2253, Government
Code, relating to performance and payment bonds apply to
construction contracts let by the district.
(g) Authorizes the district to acquire property, facilities,
and equipment for use in the hospital system and to mortgage
or pledge the property, facilities, and equipment as security
for the payment of the purchase price.
(h) Requires the board of the district to name one or more
banks to serve as depository for the funds of the district.
Requires all funds of the district to be deposited as received
with the depository bank and to remain on deposit, with an
exception. Provides that nothing in this subsection may limit
the power of the board to place a portion of the board's funds
on time deposit or to purchase certificates of deposit.
(i) Requires a bank to execute a bond or other security in an
amount sufficient to secure from loss the district funds that
exceed the amount secured by the Federal Deposit Insurance
Corporation (FDIC), before the district deposits the
district's funds in a bank in an amount that exceeds the
maximum amount secured by the FDIC.
SECTION 3.16. (a) Requires the board to annually levy a tax in an
amount not to exceed the limit approved by the voters for the
purpose of paying the indebtedness assumed or issued by the
district or the maintenance and operating expenses of the district.
(b) Prohibits a tax levied under this section from being
levied to pay the principal of or interest on revenue bonds
issued under Section 3.14 of this Act.
(c) Requires the board to consider the income of the district
from sources other than taxation in setting a tax rate.
Requires the board to make a levy and certify the levy to the
tax assessor-collector on determining the amount of tax
required to be levied.
SECTION 3.17. (a) Provides that bonds issued and indebtedness
assumed by the district are a legal and authorized investment of
certain financial institutions and political subdivisions of the
state.
(b) Provides that bonds issued or indebtedness assumed by the
district is eligible to secure the deposit of public funds of
the state and the public funds of certain political
subdivisions, and is lawful and sufficient security for the
deposits to the extent of the value of the bonds or
indebtedness when accompanied by all unmatured coupons.
SECTION 3.18. (a) Provides that the district has the right and
power of eminent domain for the purpose of acquiring by
condemnation any and all property of any kind and character in fee
simple within the boundaries of the district.
(b) Provides that the district is not required to deposit in
the trial court money or bonds as provided by Section 21.021,
Property Code.
(c) Provides that in a condemnation proceeding prosecuted by
the district, the district is not required to pay in advance
for court costs or give certain bonds.
SECTION 3.19. (a) Authorizes the directors to levy taxes for the
entire year in which the district is established as a result of the
initial election provided under this Act.
(b) Provides that the Tax Code governs the appraisal,
assessment, and collection of district taxes.
(c) Authorizes the board to provide for the appointment of a
tax assessor-collector for the district or to contract for the
assessment and collection of taxes as provided by the Tax
Code.
SECTION 3.20. (a) Requires the district to provide without charge
to a patient residing in the district the care and treatment that
the patient or a relative of the patient who is legally responsible
for the patient's support cannot pay.
(b) Requires the district to adopt an application procedure
to determine eligibility for assistance as provided in Section
61.503, Health and Safety Code, no later than the first day of
each operating year.
(c) Authorizes an administrator to cause an inquiry to be
made regarding the financial circumstances of a patient
residing in the district and admitted to a district facility
and of the relatives of the patient legally responsible for
the patient's support. Requires the administrator to report
a finding, that a patient or relative is able to pay for all
or part of the care and treatment, to the board and the board
to issue an order directing the patient or relative to pay a
specified sum according to a time and payment schedule.
Authorizes the administrator to collect sums from the estate
of the patient or a relative legally responsible for the
patient's support in the manner provided by law for collection
of expenses in the last illness of a deceased person.
(d) Requires the board to call witnesses, conduct a hearing,
and issue a final order. Requires an appeal from a final
order of the board to be made to the district court in
Comanche County in the case of a dispute regarding the ability
to pay. Provides that the substantial evidence rule applies
to an appeal under this subsection.
SECTION 3.21. Authorizes the board, on behalf of the district, to
accept donations, gifts, and endowments to be held in trust and
administered by the board for purposes and under directions,
limitations, and provisions prescribed in writing by the donor that
are not inconsistent with the proper management of the hospital
district.
SECTION 3.22. (a) Authorizes the board to borrow money at a rate
not to exceed the maximum annual percentage rate allowed by law for
district obligations at the time of the loan if the board declares
that funds are not available to meet the lawfully authorized
obligations of the district and that an emergency exists.
(b) Authorizes the board to pledge certain revenues, district
taxes, and district bonds.
(c) Requires a loan for which taxes or bonds are pledged to
mature not later than the first anniversary of the date on
which the loan is made. Requires a loan for which district
revenues are pledged to mature not later than the fifth
anniversary of the date on which the loan is made.
(d) Prohibits the board from spending money obtained from a
loan for any purpose other than for the purpose for which the
board declared an emergency. Prohibits the board from
spending the revenue other than for the purpose for which the
taxes were levied or the bonds were authorized if taxes or
bonds are pledged to pay the loan.
SECTION 3.23. (a) Prohibits a county, municipality, or political
subdivision in or partly in the district from levying taxes or
issuing bonds or other obligations for hospital purposes or for
providing medical care for the residents of the district after the
hospital district is created. Requires the hospital district to
assume full responsibility for the operation of all hospital
facilities and for the furnishing of medical and hospital care for
the district's needy residents.
(b) Requires the hospital district to assume full
responsibility for the operation of all hospital facilities
and for the furnishing of medical and hospital care for the
district's needy residents.
(c) Requires the county and all municipalities located in or
partly in the district to convey and transfer to the district
title to all land, buildings, improvements, and equipment that
pertain to a hospital or hospital system located in the
district owned by the county, municipality, or other
governmental entity, when the district is created and
established.
(d) Requires operating funds and reserves for operating
expenses to provide medical care for residents, taxes levied
for hospital purposes for the current year, and all funds
established for payment of indebtedness assumed by the
district to be transferred to the district.
SECTION 3.24. Prohibits the support and maintenance of the
hospital district from becoming a charge against or an obligation
of the state. Prohibits a direct appropriation by the legislature
from being made for the construction, maintenance, or improvement
of any of the facilities of the district.
SECTION 3.25. Provides that the district, in administering this
Act, is performing an essential public function, and that any bonds
issued or transferred are exempt from taxation by the state or any
municipality or political subdivision of the state.
SECTION 3.26. Provides that proof of publication of the notice
required in the enactment of this Act under the provisions of
Section 9, Article IX, Texas Constitution, has been made in the
manner and form provided by law pertaining to the enactment of
local and special laws, and the notice is found and declared proper
and sufficient to satisfy the requirement.
SECTION 3.27. Emergency clause.
Effective date: upon passage.