Bill not drafted by TLC or Senate E&E.

      Line and page numbers may not match official copy.

      By Hinojosa                                     H.B. No. 3234

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to the transfer of municipal hospital authority assets.

 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-4           SECTION 1.  Section 262.005, Health and Safety Code, is

 1-5     amended to read as follows:

 1-6           Sec. 262.005.  DISSOLUTION.  (a)  A governing body by

 1-7     ordinance may dissolve an authority created by the governing body

 1-8     if the governing body and the authority provide for the sale or

 1-9     transfer of the authority's assets and liabilities to the

1-10     municipality or to another person.

1-11           (b)  Upon dissolution, the assets of the authority, including

1-12     proceeds from the sale of a hospital, may not be transferred except

1-13     for due compensation unless such assets are transferred to another

1-14     governmental agency, such as the municipality or county, embracing

1-15     the territory of the authority, and using such transferred assets

1-16     in such a way as to provide for the health care needs of the

1-17     citizens, including indigent patients, formerly served by the

1-18     authority.

1-19           [(b)] (c)  The dissolution of an authority and the sale or

1-20     transfer of the authority's assets and liabilities may not:

1-21                 (1)  violate a trust indenture or bond resolution

1-22     relating to the outstanding bonds of the authority; or

1-23                 (2)  diminish or impair the rights of the holders of

1-24     outstanding bonds, warrants, or other obligations of the authority.

 2-1           [(c)] (d)  Except as otherwise provided by this section, an

 2-2     ordinance dissolving an authority takes effect on the 31st day

 2-3     after the date the governing body adopts the ordinance.

 2-4           [(d)] (e)  If before the ordinance takes effect the

 2-5     municipality receives a petition requesting a referendum on the

 2-6     dissolution that is signed by a number of registered voters of the

 2-7     municipality equal to at least 10 percent of the number of voters

 2-8     who voted in the most recent municipal election, the ordinance does

 2-9     not take effect and the governing body shall order the election.

2-10           [(e)] (f)  Section 41.001(a), Election Code, requiring an

2-11     election to be held on a uniform election date, does not apply to

2-12     an election under this section.  The ballot shall be printed to

2-13     provide for voting for or against the proposition:  "Dissolution of

2-14     the (name of the authority)."

2-15           [(f)] (g)  If a majority of the votes in the election are

2-16     cast in favor of the proposition, the ordinance takes effect on a

2-17     date stated in the order declaring the results of the election.  If

2-18     a majority of the votes in the election are cast against the

2-19     proposition, the ordinance does not take effect and the governing

2-20     body may not adopt an ordinance dissolving the authority before the

2-21     first anniversary of the date of the election.  That ordinance is

2-22     also subject to the petition and election requirements of this

2-23     section.

2-24           SECTION 2.  Section 262.022, Health and Safety Code, is

2-25     amended to read as follows:

2-26           Sec. 262.022.  [ACQUISITION, OPERATION, AND LEASE OF]

2-27     HOSPITALS AND HEALTH CARE.  (a)  The authority may construct,

2-28     purchase, enlarge, furnish, or equip one or more hospitals.  A

2-29     hospital may be located outside the municipality or municipalities.

2-30           (b)  The authority may operate and maintain one or more

 3-1     hospitals.  The authority shall operate a hospital without the

 3-2     intervention of private profit for the use and benefit of the

 3-3     public unless the authority leases the hospital.

 3-4           (c)  The board may lease a hospital, or part of a hospital,

 3-5     owned by the authority for operation by the lessee as a hospital

 3-6     under terms that are satisfactory to the board and the lessee.  The

 3-7     lease must:

 3-8                 (1)  be authorized by resolution of the board;

 3-9                 (2)  be executed on behalf of the authority by the

3-10     president and secretary of the board; and

3-11                 (3)  have the seal of the authority impressed on the

3-12     lease.

3-13           (d)  The bond resolution or trust indenture may prescribe

3-14     procedures and policies for the operation of a hospital.  If a

3-15     hospital is used, operated, or acquired by a nonprofit corporation

3-16     or is leased, the authority may delegate to the nonprofit

3-17     corporation or lessee the duty to establish the procedures and

3-18     policies.

3-19           (e)  The authority may transfer assets to another

3-20     governmental agency, such as the municipality or county, embracing

3-21     the territory of the authority, to fund or support items which are

3-22     related to providing for the health care needs of the citizens,

3-23     including indigent patients, served by the authority.

3-24           SECTION 3.  Section 262.033, Health and Safety Code, is

3-25     amended to read as follows:

3-26           Sec. 262.033.  SALE OR CLOSING OF HOSPITAL.  (a)  The board

3-27     may sell a hospital, or part of a hospital, owned by the authority

3-28     or close a hospital, or part of a hospital, owned or operated by

3-29     the authority.  The sale or closure must:

3-30                 (1)  be authorized by resolution of the board;

 4-1                 (2)  be executed on behalf of the authority by the

 4-2     president and secretary of the board; and

 4-3                 (3)  be made by a document having the seal of the

 4-4     authority impressed on it.

 4-5           (b)  Proceeds from the sale of a hospital, or part of a

 4-6     hospital, may be transferred to another governmental agency, such

 4-7     as the municipality or county, embracing the territory of the

 4-8     authority, and used to finance items related to providing for the

 4-9     health care needs of the citizens, including indigent patients,

4-10     formerly served by the authority.

4-11           [(b)] (c)  A sale or closing may not take effect before the

4-12     expiration of the period in which a petition may be filed under

4-13     Subsection [(c)] (d).

4-14           [(c)] (d)  The board shall order and conduct an election on

4-15     the sale or closing of a hospital if, before the 31st day after the

4-16     date the governing body authorizes the sale or closing, the board

4-17     receives a petition requesting the election signed by at least 10

4-18     percent of the qualified voters of the authority.  The number of

4-19     qualified voters is determined according to the most recent

4-20     official list of registered voters.

4-21           [(d)] (e)  If a petition is filed under Subsection [(c)] (d),

4-22     the hospital may be sold or closed only if a majority of the

4-23     qualified voters voting on the question approve the sale or

4-24     closing.

4-25           SECTION 4.  The importance of this legislation and the

4-26     crowded condition of the calendars in both houses create an

4-27     emergency and an imperative public necessity that the

4-28     constitutional rule requiring bills to be read on three several

4-29     days in each house be suspended, and this rule is hereby suspended,

4-30     and that this Act take effect and be in force from and after its

 5-1     passage, and it is so enacted.