76R12022 E By Solis of Cameron H.B. No. 3505 Substitute the following for H.B. No. 3505: By Uresti C.S.H.B. No. 3505 A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to the creation and operation of health services 1-3 districts; granting the power of eminent domain and the authority 1-4 to issue bonds. 1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-6 SECTION 1. Subtitle D, Title 4, Health and Safety Code, is 1-7 amended by adding Chapter 287 to read as follows: 1-8 CHAPTER 287. HEALTH SERVICES DISTRICTS 1-9 SUBCHAPTER A. GENERAL PROVISIONS 1-10 Sec. 287.001. DEFINITIONS. In this chapter: 1-11 (1) "Board" means the board of directors of a 1-12 district. 1-13 (2) "District" means a health services district 1-14 created under this chapter. 1-15 (3) "Director" means a member of the board. 1-16 Sec. 287.002. DISTRICT AUTHORIZATION. A health services 1-17 district may be created and established and, if created, must be 1-18 maintained, operated, and financed in the manner provided by this 1-19 chapter. 1-20 (Sections 287.003-287.020 reserved for expansion) 1-21 SUBCHAPTER B. CREATION OF DISTRICT 1-22 Sec. 287.021. CREATION BY CONCURRENT ORDERS. (a) Except as 1-23 provided by Subsection (b), a county or hospital district and one 1-24 or more other counties or hospital districts may create a health 2-1 services district by adopting concurrent orders. 2-2 (b) A county that is in the service area of a hospital 2-3 district may not be a party to the creation of a health services 2-4 district or to a contract with a health services district. The 2-5 hospital district that serves the county may create and contract 2-6 with the health services district for its service area. 2-7 (c) A concurrent order to create a health services district 2-8 must: 2-9 (1) be approved by the governing body of each creating 2-10 county and hospital district; 2-11 (2) contain identical provisions; and 2-12 (3) define the boundaries of the district to be 2-13 coextensive with the combined boundaries of each creating county 2-14 and hospital district. 2-15 Sec. 287.022. CONTRACT TERMS. (a) A county or hospital 2-16 district that creates a district under this chapter shall contract 2-17 with the district to provide, at a minimum, the health care 2-18 services the county or hospital district is required to provide by 2-19 law or under the constitution. A contract with a county or 2-20 hospital district that created the health services district under 2-21 this chapter must: 2-22 (1) state the term of the contract, not to exceed six 2-23 years; 2-24 (2) specify the purpose, terms, rights, and duties of 2-25 the district, as authorized by this chapter; 2-26 (3) specify the financial contributions to be made by 2-27 each party to the contract to fund the district, as described by 3-1 Section 287.024; and 3-2 (4) specify the land, buildings, improvements, 3-3 equipment, and other assets owned by a party to the contract that 3-4 the district will be required to manage and operate. 3-5 (b) Chapter 791, Government Code, does not apply to a 3-6 contract made under this chapter. 3-7 Sec. 287.023. PURPOSE AND DUTIES. A health services 3-8 district shall: 3-9 (1) provide health care services to indigent residents 3-10 of the district; 3-11 (2) provide health care services to nonindigent 3-12 residents of the district on a sliding-fee scale; 3-13 (3) acquire or construct buildings and improvements 3-14 necessary for providing health care services to residents of the 3-15 district; 3-16 (4) manage the funds contributed to the district by 3-17 each county or hospital district that contracts with the district; 3-18 (5) manage and operate the land, buildings, 3-19 improvements, equipment, and other assets for which the district 3-20 assumes responsibility for management and operation under the 3-21 contract or that are acquired or constructed by the district; 3-22 (6) plan and coordinate with public and private health 3-23 care providers and entities for the long-term provision of health 3-24 care services to residents of the district; and 3-25 (7) ensure the provision of quality health care by 3-26 health care providers employed by or under contract with the 3-27 district. 4-1 Sec. 287.024. FUNDING. (a) Each county or hospital 4-2 district that contracts with the district shall contribute to the 4-3 district for its operation: 4-4 (1) a specified dollar amount from or a percentage of 4-5 the contracting entity's operating budget and reserves; 4-6 (2) state assistance received under Chapter 61; 4-7 (3) federal matching funds received under the Medicaid 4-8 disproportionate share program; and 4-9 (4) any funds that are: 4-10 (A) received under the Agreement Regarding 4-11 Disposition of Settlement Proceeds dated July 18, 1998, or July 24, 4-12 1998, and filed in the United States District Court, Eastern 4-13 District of Texas, in the case styled The State of Texas v. The 4-14 American Tobacco Company, et al., No. 5-96CV-91; and 4-15 (B) received on or after the date on which the 4-16 district is created and before the district is dissolved. 4-17 (b) The district shall maintain an accounting of the funds 4-18 received from each county or hospital district that contracts with 4-19 the district. 4-20 (c) The district may commingle and administer the financial 4-21 contributions of all parties to the contract for district purposes. 4-22 (Sections 287.025-287.040 reserved for expansion) 4-23 SUBCHAPTER C. DISTRICT ADMINISTRATION 4-24 Sec. 287.041. BOARD OF DIRECTORS. (a) Each county or 4-25 hospital district that creates the district shall appoint two 4-26 directors to the board. 4-27 (b) In addition to the directors appointed to the board 5-1 under Subsection (a), the creating counties and hospital districts 5-2 shall agree on and collectively appoint one additional director. 5-3 (c) Directors serve staggered two-year terms, with as near 5-4 as possible to one-half of the directors' terms expiring each year. 5-5 Sec. 287.042. QUALIFICATIONS FOR OFFICE. (a) To be 5-6 eligible to serve as a director, a person must be: 5-7 (1) a resident of the county or hospital district that 5-8 appoints the person, if the person is appointed under Section 5-9 287.041(a); or 5-10 (2) a resident of the district if the person is 5-11 appointed under Section 287.041(b). 5-12 (b) An employee of the district may not serve as a director. 5-13 Sec. 287.043. BOND. (a) Before assuming the duties of the 5-14 office, each director must execute a bond for $5,000 payable to the 5-15 district, conditioned on the faithful performance of the person's 5-16 duties as director. 5-17 (b) The bond shall be kept in the permanent records of the 5-18 district. 5-19 (c) The board may pay for directors' bonds with district 5-20 funds. 5-21 Sec. 287.044. BOARD VACANCY. A vacancy in the office of 5-22 director shall be filled for the unexpired term in the same manner 5-23 as the original appointment. 5-24 Sec. 287.045. OFFICERS. (a) The board shall elect from 5-25 among its members a president and a vice president. 5-26 (b) The board shall appoint a secretary who need not be a 5-27 director. 6-1 Sec. 287.046. OFFICERS' TERMS; VACANCY. (a) Each officer 6-2 of the board serves for a term of one year. 6-3 (b) The board shall fill a vacancy in a board office for the 6-4 unexpired term. 6-5 Sec. 287.047. COMPENSATION. (a) Directors and officers 6-6 serve without compensation but may be reimbursed for actual 6-7 expenses incurred in the performance of official duties. 6-8 (b) Expenses reimbursed under this section must be: 6-9 (1) reported in the district's minute book or other 6-10 district records; and 6-11 (2) approved by the board. 6-12 Sec. 287.048. VOTING REQUIREMENT. A majority of the members 6-13 of the board voting must concur in a matter relating to the 6-14 business of the district. 6-15 Sec. 287.049. ADMINISTRATOR AND ADDITIONAL STAFF. (a) The 6-16 board may appoint qualified persons as administrator of the 6-17 district and as additional administrative staff members as the 6-18 board considers necessary for the efficient operation of the 6-19 district. 6-20 (b) The administrator and other administrative staff members 6-21 serve at the will of the board. 6-22 (c) The administrator and other administrative staff members 6-23 are entitled to compensation as determined by the board. 6-24 (d) Before assuming the administrator's duties, the 6-25 administrator shall execute a bond payable to the health services 6-26 district in an amount not less than $5,000 as determined by the 6-27 board, conditioned on the faithful performance of the 7-1 administrator's duties under this chapter. The board may pay for 7-2 the bond with district funds. 7-3 Sec. 287.050. APPOINTMENTS TO STAFF. The board may: 7-4 (1) appoint to the staff any doctors the board 7-5 considers necessary for the efficient operation of the district; 7-6 and 7-7 (2) make temporary appointments the board considers 7-8 necessary. 7-9 Sec. 287.051. TECHNICIANS, NURSES, AND OTHER DISTRICT 7-10 EMPLOYEES. (a) The district may employ or contract for services 7-11 with technicians, nurses, fiscal agents, accountants, architects, 7-12 attorneys, and other necessary employees. 7-13 (b) The board may delegate to the administrator the 7-14 authority to employ persons for the district. 7-15 Sec. 287.052. GENERAL DUTIES OF ADMINISTRATOR. The 7-16 administrator shall: 7-17 (1) supervise the work and activities of the district; 7-18 and 7-19 (2) direct the general affairs of the district, 7-20 subject to the limitations prescribed by the board. 7-21 Sec. 287.053. RETIREMENT BENEFITS. The board may provide 7-22 retirement benefits for employees of the district by: 7-23 (1) establishing or administering a retirement 7-24 program; or 7-25 (2) electing to participate in the Texas County and 7-26 District Retirement System or in any other statewide retirement 7-27 system in which the district is eligible to participate. 8-1 (Sections 287.054-287.070 reserved for expansion 8-2 SUBCHAPTER D. POWERS AND DUTIES 8-3 Sec. 287.071. RESPONSIBILITY OF GOVERNMENTAL ENTITY. On 8-4 creation of a district, a county or hospital district in which the 8-5 district is located shall transfer to the district: 8-6 (1) management and operation of any land, buildings, 8-7 improvements, and equipment related to the health care system 8-8 located wholly in the district that are owned by the county or 8-9 hospital district in which the district is located, as specified in 8-10 the contract with the counties and hospital districts that created 8-11 the district; and 8-12 (2) operating funds and reserves for operating 8-13 expenses and funds that have been budgeted by the county or 8-14 hospital district in which the district is located to provide 8-15 medical care for residents of the district, as specified in the 8-16 contract with the counties and hospital districts that created the 8-17 district. 8-18 Sec. 287.072. DISTRICT RESPONSIBILITIES. On creation of a 8-19 district, the district assumes the duties required under Section 8-20 287.023 and any additional duties specified in the contract with 8-21 the counties and hospital districts that created the district. 8-22 Sec. 287.073. MANAGEMENT, CONTROL, AND ADMINISTRATION. The 8-23 board shall manage, control, and administer the health care system 8-24 and the funds and resources of the district that are transferred 8-25 under Section 287.071. 8-26 Sec. 287.074. DISTRICT RULES. The board may adopt rules 8-27 governing the operation of the district and the duties, functions, 9-1 and responsibilities of district staff and employees. 9-2 Sec. 287.075. METHODS AND PROCEDURES. The board may 9-3 prescribe: 9-4 (1) the method of making purchases and expenditures by 9-5 and for the district; and 9-6 (2) accounting and control procedures for the 9-7 district. 9-8 Sec. 287.076. HEALTH CARE PROPERTY, FACILITIES, AND 9-9 EQUIPMENT. (a) The board shall determine: 9-10 (1) the type, number, and location of buildings 9-11 required to establish and maintain an adequate health care system; 9-12 and 9-13 (2) the type of equipment necessary for health care. 9-14 (b) The board may: 9-15 (1) acquire property, facilities, and equipment for 9-16 the district for use in the health care system; 9-17 (2) mortgage or pledge the property, facilities, or 9-18 equipment acquired as security for the payment of the purchase 9-19 price; 9-20 (3) transfer by lease to physicians, individuals, 9-21 companies, corporations, or other legal entities or acquire by 9-22 lease district health care facilities; 9-23 (4) sell or otherwise dispose of property, facilities, 9-24 or equipment acquired by the district; and 9-25 (5) contract with a state agency to provide facilities 9-26 and health care services. 9-27 Sec. 287.077. CONSTRUCTION CONTRACTS. (a) The board may 10-1 enter into construction contracts for the district. 10-2 (b) The board may enter into construction contracts that 10-3 involve spending more than $10,000 only after competitive bidding 10-4 as provided by Subchapter B, Chapter 271, Local Government Code. 10-5 (c) Chapter 2253, Government Code, as it relates to 10-6 performance and payment bonds, applies to construction contracts 10-7 let by the district. 10-8 Sec. 287.078. DISTRICT OPERATING AND MANAGEMENT CONTRACTS. 10-9 The board may enter into operating or management contracts relating 10-10 to health care facilities owned by the district or for which the 10-11 district assumes responsibility for managing and operating under 10-12 the terms of the contract with the counties and hospital districts 10-13 that created the district. 10-14 Sec. 287.079. EMINENT DOMAIN. (a) A district may exercise 10-15 the power of eminent domain to acquire a fee simple or other 10-16 interest in property located in the territory of the district if 10-17 the property interest is necessary to the exercise of the rights or 10-18 authority conferred by this chapter. 10-19 (b) A district must exercise the power of eminent domain in 10-20 the manner provided by Chapter 21, Property Code, but the district 10-21 is not required to deposit in the trial court money or a bond as 10-22 provided by Section 21.021(a), Property Code. 10-23 (c) In a condemnation proceeding brought by a district, the 10-24 district is not required to: 10-25 (1) pay in advance or give bond or other security for 10-26 costs in the trial court; 10-27 (2) give bond for the issuance of a temporary 11-1 restraining order or a temporary injunction; or 11-2 (3) give bond for costs or supersedeas on an appeal or 11-3 writ of error. 11-4 Sec. 287.080. EXPENSES FOR MOVING FACILITIES OF RAILROADS OR 11-5 UTILITIES. If, in exercising the power of eminent domain, the 11-6 board requires relocating, raising, lowering, rerouting, changing 11-7 the grade, or altering the construction of any railroad, highway, 11-8 pipeline, or electric transmission and electric distribution, 11-9 telegraph, or telephone lines, conduits, poles, or facilities, the 11-10 district must bear the actual cost of relocating, raising, 11-11 lowering, rerouting, changing the grade, or altering the 11-12 construction to provide comparable replacement without enhancement 11-13 of a facility, after deducting the net salvage value derived from 11-14 the old facility. 11-15 Sec. 287.081. PAYMENT FOR HEALTH CARE SERVICES. (a) The 11-16 district without charge shall supply to a patient residing in the 11-17 district the care and treatment for which the patient, the 11-18 patient's guardian out of the estate of the patient, or a relative 11-19 of the patient who is legally responsible for the patient's support 11-20 cannot pay. In determining the type and degree of care and 11-21 treatment required by a patient, a health care professional 11-22 employed by or under contract with the district may not consider 11-23 that the patient or the patient's relative who is responsible for 11-24 the patient's support cannot pay for the care and treatment of the 11-25 patient. 11-26 (b) Not later than the first day of each operating year, the 11-27 district shall adopt an application procedure to determine 12-1 eligibility for assistance that complies with Section 61.053. 12-2 (c) The administrator of the district may have an inquiry 12-3 made into the financial circumstances of: 12-4 (1) a patient residing in the district and admitted to 12-5 a district facility, including the size of the patient's estate; 12-6 and 12-7 (2) a relative of the patient who is legally 12-8 responsible for the patient's support, including the size of the 12-9 relative's estate. 12-10 (d) The board may adopt a sliding-fee scale for health care 12-11 services provided to a patient who can pay for some, but not all, 12-12 of the care and treatment provided by the district. The fees for 12-13 health care services provided to a patient described by this 12-14 subsection must be based on the income level and size of the estate 12-15 of the patient or relative of the patient who is legally 12-16 responsible for the patient's support. 12-17 (e) A county that created and contracted with the district 12-18 may credit a district expenditure for the care and treatment of an 12-19 eligible county resident to the same extent and in the same manner 12-20 the county would be able to claim the expenditure under Chapter 61 12-21 if the county made the expenditure. 12-22 (f) The board shall adopt rules regarding the collection of 12-23 money that is owed to the district for health care services 12-24 provided to a patient who is determined to be able to pay for all 12-25 or any part of the services from a patient, a patient's estate, or 12-26 a relative who is legally responsible for the patient's support. 12-27 Sec. 287.082. REIMBURSEMENT FOR SERVICES. (a) The board 13-1 shall require reimbursement from a county, municipality, or public 13-2 hospital located outside the boundaries of the district for the 13-3 district's care and treatment of a sick, diseased, or injured 13-4 person of that county, municipality, or public hospital as provided 13-5 by Chapter 61. 13-6 (b) The board shall require reimbursement from the sheriff 13-7 or police chief of a county or municipality for the district's care 13-8 and treatment of a person confined in a jail facility of the county 13-9 or municipality who is not a resident of the district. 13-10 (c) The board may contract with the state or federal 13-11 government for the state or federal government to reimburse the 13-12 district for treatment of a sick, diseased, or injured person. 13-13 Sec. 287.083. SERVICE CONTRACTS. The board may contract 13-14 with a municipality, county, special district, or other political 13-15 subdivision of the state or with a state or federal agency for the 13-16 district to: 13-17 (1) furnish a mobile emergency medical service; or 13-18 (2) provide for the investigatory or welfare needs of 13-19 inhabitants of the district. 13-20 Sec. 287.084. GIFTS, GRANTS, AND ENDOWMENTS. On behalf of 13-21 the district, the board may accept gifts, grants, and endowments to 13-22 be held in trust for any purpose and under any direction, 13-23 limitation, or provision prescribed in writing by the donor that is 13-24 consistent with the proper management of the district. 13-25 Sec. 287.085. AUTHORITY TO SUE AND BE SUED. The board may 13-26 sue and be sued on behalf of the district. 13-27 (Sections 287.086-287.100 reserved for expansion 14-1 SUBCHAPTER E. DISSOLUTION OF DISTRICT 14-2 Sec. 287.101. DISSOLUTION. A district shall be dissolved if 14-3 the contract with the counties and hospital districts that created 14-4 the district expires and is not renewed. 14-5 Sec. 287.102. TRANSFER OF ASSETS AFTER DISSOLUTION. (a) If 14-6 the district is dissolved, the board shall: 14-7 (1) transfer the land, buildings, improvements, 14-8 equipment, and other assets acquired by the district to the county 14-9 or other governmental entity in which the property is located; or 14-10 (2) administer the property, assets, and debts in 14-11 accordance with Section 287.103. 14-12 (b) If the district transfers its land, buildings, 14-13 improvements, equipment, and other assets to a county or other 14-14 governmental entity, the county or entity assumes all debts and 14-15 obligations of the district related to the land, buildings, 14-16 improvements, equipment, or assets at the time of the transfer, and 14-17 the district is dissolved. 14-18 Sec. 287.103. ADMINISTRATION OF PROPERTY, DEBTS, AND ASSETS 14-19 AFTER DISSOLUTION. (a) If the district does not transfer its 14-20 land, buildings, improvements, equipment, and other assets to a 14-21 county or another governmental entity in the district, the board 14-22 shall continue to control and administer the property, debts, and 14-23 assets of the district until all funds have been disposed of and 14-24 all district debts have been paid or settled. 14-25 (b) If, after administering the property and assets, the 14-26 board determines that the district's property and assets are 14-27 insufficient to pay the debts of the district, the district shall 15-1 transfer the remaining debts to the counties and hospital districts 15-2 that created the district in proportion to the funds contributed to 15-3 the district by each county or hospital district. 15-4 (c) If, after administering the property and assets, the 15-5 board determines that unused funds remain, the board shall transfer 15-6 the unused funds to the counties and hospital districts that 15-7 created the district in proportion to the funds contributed to the 15-8 district by each county or hospital district. 15-9 Sec. 287.104. ACCOUNTING. After the district has paid all 15-10 its debts and has disposed of all its assets and funds as 15-11 prescribed by Sections 287.102 and 287.103, the board shall provide 15-12 an accounting to each county and hospital district that created and 15-13 contracted with the district. The accounting must show the manner 15-14 in which the assets and debts of the district were distributed. 15-15 (Sections 287.105-287.120 reserved for expansion 15-16 SUBCHAPTER F. DISTRICT FINANCES 15-17 Sec. 287.121. FISCAL YEAR. (a) The district operates on 15-18 the fiscal year established by the board. 15-19 (b) The fiscal year may not be changed if revenue bonds of 15-20 the district are outstanding or more than once in a 24-month 15-21 period. 15-22 Sec. 287.122. ANNUAL AUDIT. (a) The board annually shall 15-23 have an audit made of the financial condition of the district. 15-24 (b) A copy of the audit must be provided to each county and 15-25 hospital district that created and contracted with the district. 15-26 Sec. 287.123. DISTRICT AUDIT AND RECORDS. The annual audit 15-27 and other district records are open to inspection during regular 16-1 business hours at the principal office of the district. 16-2 Sec. 287.124. ANNUAL BUDGET. (a) The administrator of the 16-3 district shall prepare a proposed annual budget for the district. 16-4 (b) The proposed budget must contain a complete financial 16-5 statement, including a statement of: 16-6 (1) the outstanding obligations of the district; 16-7 (2) the amount of cash on hand to the credit of each 16-8 fund of the district; 16-9 (3) the amount of money received by the district from 16-10 all sources during the previous year; 16-11 (4) the amount of money available to the district from 16-12 all sources during the ensuing year; 16-13 (5) the amount of the balances expected at the end of 16-14 the year in which the budget is being prepared; and 16-15 (6) the estimated amount of revenues and balances 16-16 available to cover the proposed budget. 16-17 Sec. 287.125. NOTICE; HEARING; ADOPTION OF BUDGET. (a) The 16-18 board shall hold a public hearing on the proposed annual budget. 16-19 (b) The board shall publish notice of the hearing in a 16-20 newspaper of general circulation in the district not later than the 16-21 10th day before the date of the hearing. 16-22 (c) Any resident of the district is entitled to be present 16-23 and participate at the hearing. 16-24 (d) At the conclusion of the hearing, the board shall adopt 16-25 a budget by acting on the budget proposed by the administrator. 16-26 The board may make any changes in the proposed budget that in its 16-27 judgment the interests of the residents of the district demand. 17-1 (e) The budget is effective only after adoption by the 17-2 board. 17-3 Sec. 287.126. AMENDING BUDGET. After adoption, the annual 17-4 budget may be amended on the board's approval. 17-5 Sec. 287.127. LIMITATION OF EXPENDITURES. (a) Money may 17-6 not be spent for an expense not included in the annual budget or an 17-7 amendment to it. 17-8 (b) The annual budget for administrative expenses may not 17-9 exceed 10 percent of the total annual budget of the district 17-10 unless, after notice and hearing in the same manner as required for 17-11 the adoption of the annual budget under Section 287.125, the board 17-12 approves an amendment to increase the budget for administrative 17-13 expenses. 17-14 Sec. 287.128. SWORN STATEMENT. As soon as practicable after 17-15 the close of the fiscal year, the administrator shall prepare for 17-16 the board a sworn statement of the amount of money that belongs to 17-17 the district and an account of the disbursements of that money. 17-18 Sec. 287.129. SPENDING AND INVESTMENT LIMITATIONS. (a) 17-19 Except for construction contracts under Section 287.077(a) or as 17-20 provided by Sections 287.142 and 287.143, the district may not 17-21 incur a debt payable from revenues of the district other than the 17-22 revenues on hand or to be on hand in the current and immediately 17-23 following fiscal year of the district. 17-24 (b) The board may invest operating, depreciation, or 17-25 building reserves only in funds or securities specified by Article 17-26 836 or 837, Revised Statutes. 17-27 Sec. 287.130. DEPOSITORY. (a) The board shall name at 18-1 least one bank to serve as depository for district funds. 18-2 (b) District funds, other than those invested as provided by 18-3 Section 287.129(b) and those transmitted to a bank of payment for 18-4 bonds or obligations issued or assumed by the district, shall be 18-5 deposited as received with the depository bank and must remain on 18-6 deposit. This subsection does not limit the power of the board to 18-7 place a portion of district funds on time deposit or to purchase 18-8 certificates of deposit. 18-9 (c) Before the district deposits funds in a bank in an 18-10 amount that exceeds the maximum amount secured by the Federal 18-11 Deposit Insurance Corporation, the bank must execute a bond or 18-12 other security in an amount sufficient to secure from loss the 18-13 district funds that exceed the amount secured by the Federal 18-14 Deposit Insurance Corporation. 18-15 Sec. 287.131. AD VALOREM TAXATION. A district may not 18-16 impose an ad valorem tax. 18-17 (Sections 287.132-287.140 reserved for expansion 18-18 SUBCHAPTER G. BONDS 18-19 Sec. 287.141. GENERAL OBLIGATION BONDS. A district may not 18-20 issue general obligation bonds. 18-21 Sec. 287.142. REVENUE BONDS. (a) The board may issue 18-22 revenue bonds to: 18-23 (1) purchase, construct, acquire, repair, equip, or 18-24 renovate buildings or improvements for district purposes; 18-25 (2) acquire sites to be used for district purposes; or 18-26 (3) acquire and operate a mobile emergency medical 18-27 service to assist the district in carrying out its purposes. 19-1 (b) The bonds must be payable from and secured by a pledge 19-2 of all or part of the revenues derived from the operation of the 19-3 district's health care system. The bonds may be additionally 19-4 secured by a mortgage or deed of trust lien on all or part of 19-5 district property. 19-6 (c) The bonds must be issued in the manner provided by 19-7 Sections 264.042, 264.043, 264.046, 264.047, 264.048, and 264.049 19-8 for issuance of revenue bonds by county hospital authorities. 19-9 Sec. 287.143. REFUNDING BONDS. (a) Refunding bonds of the 19-10 district may be issued to refund an outstanding indebtedness the 19-11 district has issued or assumed. 19-12 (b) The bonds must be issued in the manner provided by 19-13 Chapter 784, Acts of the 61st Legislature, Regular Session, 1969 19-14 (Article 717k-3, Vernon's Texas Civil Statutes). 19-15 (c) The refunding bonds may be sold and the proceeds applied 19-16 to the payment of outstanding indebtedness or may be exchanged in 19-17 whole or in part for not less than a similar principal amount of 19-18 outstanding indebtedness. If the refunding bonds are to be sold 19-19 and the proceeds applied to the payment of outstanding 19-20 indebtedness, the refunding bonds must be issued and payments made 19-21 in the manner provided by Chapter 503, Acts of the 54th 19-22 Legislature, Regular Session, 1955 (Article 717k, Vernon's Texas 19-23 Civil Statutes). 19-24 Sec. 287.144. INTEREST AND MATURITY. District bonds must 19-25 mature not later than the 50th anniversary of the date of their 19-26 issuance and must bear interest at a rate not to exceed that 19-27 provided by Chapter 3, Acts of the 61st Legislature, Regular 20-1 Session, 1969 (Article 717k-2, Vernon's Texas Civil Statutes). 20-2 Sec. 287.145. EXECUTION OF BONDS. The president of the 20-3 board shall execute the bonds in the name of the district, and the 20-4 secretary of the board shall countersign the bonds in the manner 20-5 provided by the Texas Uniform Facsimile Signature of Public 20-6 Officials Act (Article 717j-1, Vernon's Texas Civil Statutes). 20-7 Sec. 287.146. APPROVAL AND REGISTRATION OF BONDS. (a) 20-8 District bonds are subject to the same requirements with regard to 20-9 approval by the attorney general and registration by the 20-10 comptroller as the law provides for approval and registration of 20-11 bonds issued by counties. 20-12 (b) On approval by the attorney general and registration by 20-13 the comptroller, the bonds are incontestable for any cause. 20-14 Sec. 287.147. BONDS AS INVESTMENTS. District bonds and 20-15 indebtedness assumed by the district are legal and authorized 20-16 investments for: 20-17 (1) banks; 20-18 (2) savings banks; 20-19 (3) trust companies; 20-20 (4) savings and loan associations; 20-21 (5) insurance companies; 20-22 (6) fiduciaries; 20-23 (7) trustees; 20-24 (8) guardians; and 20-25 (9) sinking funds of municipalities, counties, school 20-26 districts, and other political subdivisions of the state and other 20-27 public funds of the state and its agencies, including the permanent 21-1 school fund. 21-2 Sec. 287.148. BONDS AS SECURITY FOR DEPOSITS. District 21-3 bonds are eligible to secure deposits of public funds of the state 21-4 and of municipalities, counties, school districts, and other 21-5 political subdivisions of the state. The bonds are lawful and 21-6 sufficient security for deposits to the extent of their value if 21-7 accompanied by all unmatured coupons. 21-8 Sec. 287.149. TAX STATUS OF BONDS. Because the district 21-9 created under this chapter is a public entity performing an 21-10 essential public function, bonds issued by the district, any 21-11 transaction relating to the bonds, and profits made in the sale of 21-12 the bonds are free from taxation by the state or by any 21-13 municipality, county, special district, or other political 21-14 subdivision of the state. 21-15 SECTION 2. This Act takes effect September 1, 1999. 21-16 SECTION 3. The importance of this legislation and the 21-17 crowded condition of the calendars in both houses create an 21-18 emergency and an imperative public necessity that the 21-19 constitutional rule requiring bills to be read on three several 21-20 days in each house be suspended, and this rule is hereby suspended.