1-1     By:  Counts (Senate Sponsor - Duncan)                 H.B. No. 2477
 1-2           (In the Senate - Received from the House May 2, 2001;
 1-3     May 3, 2001, read first time and referred to Committee on
 1-4     Intergovernmental Relations; May 11, 2001, reported favorably by
 1-5     the following vote:  Yeas 5, Nays 0; May 11, 2001, sent to
 1-6     printer.)
 1-7                            A BILL TO BE ENTITLED
 1-8                                   AN ACT
 1-9     relating to the Garza County Health Care District.
1-10           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-11           SECTION 1.  Section 1, Chapter 502, Acts of the 60th
1-12     Legislature, Regular Session, 1967, is amended to read as follows:
1-13           Sec. 1.   In accordance with the provisions of Article IX,
1-14     Section 9, Constitution of the State of Texas, this Act shall be
1-15     operative so as to authorize the creation, establishment,
1-16     maintenance and operation of a hospital district within the State
1-17     of Texas, to be known as the Garza County Health Care [Hospital]
1-18     District, such district to have boundaries coextensive with the
1-19     boundaries of Garza County, and said district shall have the powers
1-20     and responsibilities provided by the aforesaid constitutional
1-21     provision.
1-22           SECTION 2.  Section 3, Chapter 502, Acts of the 60th
1-23     Legislature, Regular Session, 1967, is amended to read as follows:
1-24           Sec. 3.  (a)  Within 10 days after such election is held, the
1-25     Commissioners Court of Garza County shall convene and canvass the
1-26     returns of the election, and if a majority of the legally qualified
1-27     property taxpaying electors voting at said election voted in favor
1-28     of the proposition, the court shall so find and declare the
1-29     hospital district established and created and appoint five persons
1-30     as directors of the hospital district to serve until the first
1-31     Saturday in April, at which time five directors shall be elected.
1-32     The three directors receiving the highest vote at such first
1-33     election shall serve for two years, the other two directors shall
1-34     serve for one year.  Thereafter, all directors shall serve for a
1-35     period of two years and until their successor has been duly elected
1-36     or appointed and qualified.  To be eligible to serve [No person
1-37     shall be appointed or elected] as a member of the board of
1-38     directors of said [hospital] district, a person must be at least
1-39     [unless he is a resident thereof and owns land subject to taxation
1-40     therein and unless at the time of such election or appointment he
1-41     shall be more than] 21 years of age and [have been] a resident of
1-42     the district and must have resided in the district for at least six
1-43     months immediately preceding the date on which the person files for
1-44     election or is appointed or elected to fill a vacancy in the office
1-45     of director, as appropriate [for at least two years].  Each member
1-46     of the board of directors shall qualify by executing the
1-47     constitutional oath of office and may be required to [shall]
1-48     execute a good and sufficient bond for $1,000 payable to said
1-49     district conditioned upon the faithful performance of his duties,
1-50     and such oaths and bonds shall be deposited with the depository
1-51     bank of the district for safekeeping.  The board of directors may
1-52     pay for the bonds if required of the directors with district funds.
1-53           If the proposition to create the Garza Hospital District
1-54     fails to carry at the election, no other election for the same
1-55     purpose may be held within one year after the result of the
1-56     election is announced officially.
1-57           (b)  The board of directors shall appoint an administrator,
1-58     who may be required to [shall] execute a good and sufficient bond
1-59     for $10,000 payable to said district conditioned upon the faithful
1-60     performance of the person's [his] duties, and such oath and bond
1-61     shall be deposited with the depository bank for safekeeping.  The
1-62     board of directors may pay for the bond of the administrator with
1-63     district funds.  The administrator shall not receive a contract for
1-64     a specified term and may be terminated at any time by the board of
 2-1     directors.
 2-2           (c)  The board of directors shall organize by electing one of
 2-3     their number as president and by appointing one of their number as
 2-4     secretary.  Any three members of the board of directors shall
 2-5     constitute a quorum and a concurrence of three shall be sufficient
 2-6     in all matters pertaining to the business of the district.  A
 2-7     meeting of the board of directors may be called by the president or
 2-8     any three directors.  Notice of the time and place of any meeting
 2-9     must be given to all the directors at least 72 hours before [not
2-10     less than seven days prior to] the time of the meeting.  Nothing
2-11     herein shall prevent the board of directors from establishing by
2-12     resolution a regular time and place for meetings, for which no
2-13     special notice need be given.  All vacancies in the office of
2-14     director shall be filled for the unexpired term by appointment of
2-15     the remainder of the board of directors.  In the event the number
2-16     of directors shall be reduced to less than three for any reason the
2-17     remaining directors shall immediately call a special election to
2-18     fill said vacancies, and upon failure to do so a district court
2-19     may, upon application of any voter or taxpayer of the district,
2-20     issue a mandate requiring that such election be ordered by the
2-21     remaining directors.
2-22           (d)  A regular election of directors shall be held on the
2-23     first Saturday in May [April] of each year.  The election shall be
2-24     held in accordance with the Election Code.  Notice [and notice] of
2-25     such election shall be published in a newspaper of general
2-26     circulation in the county one time at least 10 days prior to the
2-27     date of the election.  Any person desiring his name to be printed
2-28     on the ballot as a candidate for director shall file an application
2-29     [a petition, signed by not less than 15 legally qualified voters
2-30     asking that such name be printed on the ballot,] with the secretary
2-31     of the board of directors of the district[.  Such petition shall be
2-32     filed with such secretary] at least 45 [25] days before [prior to]
2-33     the date of election.
2-34           SECTION 3.  Section 4, Chapter 502, Acts of the 60th
2-35     Legislature, Regular Session, 1967, is amended to read as follows:
2-36           Sec. 4.  The management and control of such [hospital]
2-37     district created pursuant to the provisions of this Act is hereby
2-38     vested in the board of directors of the district who shall serve
2-39     without compensation but may be reimbursed for actual expenses
2-40     incurred in the performance of their official duties upon the
2-41     approval of such expenses by the board of directors.
2-42           SECTION 4.  Section 5, Chapter 502, Acts of the 60th
2-43     Legislature, Regular Session, 1967, is amended to read as follows:
2-44           Sec. 5.  (a)  The [Upon the creation of such hospital
2-45     district, the] board of directors shall have the power and
2-46     authority and it shall be their duty to levy a tax on all property
2-47     subject to [hospital] district taxation for the benefit of the
2-48     district.  All taxes of the district shall be assessed and
2-49     collected as provided by Subsections (b) and (c) [at the same time
2-50     taxes are levied for county purposes, using the county values and
2-51     the county tax rolls, a tax of not to exceed 25 cents on the $100
2-52     valuation of all taxable property within the hospital district, for
2-53     the purpose of:  (1) paying the interest on and creating a sinking
2-54     fund for warrants which may be issued by the hospital district for
2-55     hospital purposes as herein provided; (2) providing for the
2-56     operation and maintenance of the hospital or hospital system; and
2-57     (3) for the purpose of making further improvements and additions to
2-58     the hospital system, and for the acquisition of necessary sites
2-59     therefor, by purchase, lease or condemnation].
2-60           (b)  The board of directors may annually impose property
2-61     taxes in an amount not to exceed the limit approved by the voters
2-62     at the election authorizing the levy of taxes.  The tax rate for
2-63     all purposes may not exceed 75 cents on each $100 valuation of all
2-64     taxable property in the district.  The taxes may be used for the
2-65     purposes provided by Subsection (c).  The district may not impose
2-66     taxes to pay the principal of or interest on revenue bonds.  The
2-67     Tax Code governs the appraisal, assessment, and collection of
2-68     district taxes.  The board may provide for the appointment of a tax
2-69     assessor-collector for the district or may contract for the
 3-1     assessment and collection of taxes as provided by the Tax Code.
 3-2           (c)  The taxes may be used to:
 3-3                 (1)  pay the interest on and create a sinking fund for
 3-4     warrants that may be issued by the district for health care
 3-5     purposes;
 3-6                 (2)  pay for the maintenance and operating expenses of
 3-7     the district and health care system;
 3-8                 (3)  pay for indebtedness issued or assumed by the
 3-9     district;
3-10                 (4)  make further improvements and additions to the
3-11     health care system; and
3-12                 (5)  acquire necessary sites for the health care system
3-13     by purchase, lease, or condemnation [Not later than October 1st of
3-14     each year, the board of directors shall levy the tax on all taxable
3-15     property within the district which is subject to taxation and shall
3-16     immediately certify such tax rate to the tax assessor and collector
3-17     of Garza County.  The tax so levied shall be collected on all
3-18     property subject to hospital district taxation by the assessor and
3-19     collector of taxes for the county on the county tax values, and in
3-20     the same manner and under the same conditions as county taxes.  The
3-21     assessor and collector of taxes shall charge and deduct from
3-22     payments to the hospital district the fees for assessing and
3-23     collecting the tax at the rate of not exceeding five percent on the
3-24     first $10,000 and two percent on all such taxes thereafter, but in
3-25     no event in excess of $5,000 for any one fiscal year.  Such fees
3-26     shall be deposited in the county's general fund, and shall be
3-27     reported as fees of office of the tax assessor and collector.
3-28     Interest and penalties on taxes paid to the hospital district shall
3-29     be the same as in the case of county taxes.  Discounts shall be the
3-30     same as for county taxes.  The residue of tax collections, after
3-31     deduction of discounts and fees for assessing and collecting, shall
3-32     be deposited in the district depository and such funds shall be
3-33     withdrawn only as provided herein. All other income of the hospital
3-34     district shall be deposited in like manner with the district
3-35     depository].
3-36           (d) [(c)]  The board of directors shall have the authority to
3-37     levy the tax aforesaid for the entire year in which the said
3-38     [hospital] district is established [for the purpose of securing
3-39     funds to initiate the operation of the hospital district].
3-40           SECTION 5.  Section 6, Chapter 502, Acts of the 60th
3-41     Legislature, Regular Session, 1967, is amended to read as follows:
3-42           Sec. 6.  (a)  The board of directors may issue general
3-43     obligation bonds [shall have the power and authority to issue and
3-44     sell as the obligations of the hospital district, and] in the name
3-45     and upon the faith and credit of the [hospital] district to:
3-46                 (1)  purchase, construct, acquire, repair, or renovate
3-47     buildings or improvements;
3-48                 (2)  equip buildings or improvements for health care
3-49     purposes; or
3-50                 (3)  acquire and operate a mobile emergency medical or
3-51     air ambulance service.
3-52           (b)  At the time of the issuances of any general obligation
3-53     bonds by the district, [bonds for the repair or renovation of
3-54     building and improvements and equipping the same for hospital
3-55     purposes and for any and all of such purposes; provided, that] a
3-56     sufficient tax shall be levied to create an interest and sinking
3-57     fund to pay the interest and principal as same matures, provided
3-58     that the maintenance and operation tax, together with the bond tax,
3-59     shall not exceed the rate of tax approved by the voters at the
3-60     election authorizing the levy of taxes.  The district may issue
3-61     general obligation bonds only if the bonds are authorized by a
3-62     majority of the qualified voters of the district voting at an
3-63     election called and held for that purpose.  The board may order a
3-64     bond election.  The bond election shall be conducted as provided by
3-65     Chapter 1251, Government Code.  The board shall canvass the returns
3-66     and declare the results of the election.
3-67           (c)  The district may issue revenue bonds for any health care
3-68     purpose, including a purpose described by Subsection (a) of this
3-69     section, only if the bonds are authorized by a majority of the
 4-1     qualified voters of the district voting at an election called and
 4-2     held for that purpose.  The bonds shall be payable from and secured
 4-3     by a pledge on all or part of the revenues derived from the
 4-4     operation of the district's health care system.  The bonds may be
 4-5     additionally secured by a mortgage or deed of trust on all or part
 4-6     of the district's property.  The revenue bonds shall be issued in
 4-7     the manner provided by Sections 264.042, 264.043, 264.046, 264.047,
 4-8     264.048, and 264.049, Health and Safety Code, for the issuance of
 4-9     revenue bonds by county hospital authorities.
4-10           (d)  Bonds of the district [25 cents on the $100 valuation in
4-11     any one year, or such maximum amount as may hereafter be voted as
4-12     provided in Section 7 hereof.  Such bond] shall be executed in the
4-13     name of the district and on its behalf by the president of the
4-14     board of directors, and countersigned by the secretary of the board
4-15     of directors, and shall be subject to the same requirements in the
4-16     matter of approval thereof by the Attorney General of the State of
4-17     Texas and registration thereof by the Comptroller of Public
4-18     Accounts of the State of Texas as are by law provided for such
4-19     approval and registration of bonds of such county.  Upon the
4-20     approval of such bonds by the Attorney General of Texas the same
4-21     shall be incontestable for any cause.  [No bonds shall be issued by
4-22     the hospital district (except refunding bonds) until authorized by
4-23     a majority vote of the legally qualified property taxpaying
4-24     electors, residing in the hospital district, voting at an election
4-25     called and held for such purpose.  Such election may be called by
4-26     the board of directors on its own motion, shall specify the place
4-27     or places where the election shall be held, the presiding officers
4-28     thereof, the purpose for which the bonds are to be issued, the
4-29     amount thereof, the maximum interest rate (not to exceed six
4-30     percent per annum) and the maximum maturity date of such bonds (not
4-31     to exceed 40 years from their date of issuance).  Notice of
4-32     election shall be given by publishing a substantial copy of the
4-33     order calling the election in a newspaper of general circulation in
4-34     such county once a week for two consecutive weeks prior to the date
4-35     of election, the date of the first publication being at least 14
4-36     full days prior to the date set for the election.]  The costs of
4-37     such election shall be paid by the [hospital] district.
4-38           (e)  Bonds of the district must mature not later than the
4-39     40th anniversary of the date of issuance and must bear a rate of
4-40     interest that does not exceed the amount provided by Chapter 1204,
4-41     Government Code.
4-42           (f) [(b)]  In the manner hereinabove provided, the bonds of
4-43     such [hospital] district may, without the necessity of any election
4-44     therefor, be issued for the purpose of refunding and paying off any
4-45     bonded indebtedness theretofore issued by such [hospital] district;
4-46     such refunding bonds may be sold and the proceeds thereof applied
4-47     to the payment of any such outstanding bonds or may be exchanged in
4-48     whole or in part for not less than a like amount, of said
4-49     outstanding bonds and interest matured thereon, but unpaid;
4-50     provided the average interest cost per annum on the refunding
4-51     bonds, computed in accordance with recognized standard bond
4-52     interest cost tables shall not exceed the average interest cost per
4-53     annum so computed, upon the bonds to be discharged out of the
4-54     proceeds of the refunding bonds, unless the total interest cost on
4-55     the refunding bonds, computed to their respective maturity dates,
4-56     is less than the total interest cost so computed on the bonds to be
4-57     discharged out of such proceeds.  In the foregoing computations,
4-58     any premium or premiums required to be paid upon the bonds to be
4-59     refunded as a condition to payment in advance of their stated
4-60     maturity dates shall be taken into account as an addition to the
4-61     net interest cost to the [hospital] district of the refunding
4-62     bonds.
4-63           (g) [(c)  The board of directors shall not have the power and
4-64     authority to purchase, construct or acquire property in excess of
4-65     $25,000 without submitting the vote to the qualified taxpaying
4-66     voters of said district, and a majority of the legally qualified
4-67     property taxpaying electors participating in said election voting
4-68     in favor of the proposition shall be necessary.]
4-69           [(d)]  The [hospital] district shall not make any contract
 5-1     calling for or requiring the expenditure or payment of $15,000
 5-2     [$1,000] or more out of any fund or funds of said district creating
 5-3     or imposing an obligation or liability of any nature or character
 5-4     upon such [hospital] district, without first submitting such
 5-5     proposed contract to competitive bids.
 5-6           SECTION 6.  Section 7, Chapter 502, Acts of the 60th
 5-7     Legislature, Regular Session, 1967, is amended to read as follows:
 5-8           Sec. 7.   The board of directors shall have the authority to
 5-9     call an election on the question of whether or not the tax
5-10     hereinabove provided for shall be increased to a specified rate
5-11     allowed by law on the $100 valuation of all taxable property within
5-12     the [hospital] district, if and when the board of directors
5-13     determines that an increase in such tax rate is necessary to carry
5-14     out the purposes for which the initial tax rate was authorized.
5-15     Said election shall be held in the same manner as the election for
5-16     [the creation of the district and] the levy of the initial tax as
5-17     hereinabove provided.
5-18           SECTION 7.  Section 8, Chapter 502, Acts of the 60th
5-19     Legislature, Regular Session, 1967, is amended by amending
5-20     Subsection (a) and by adding Subsections (d) through (l) to read as
5-21     follows:
5-22           (a)  The board of directors of the district shall have the
5-23     power to prescribe the method and manner of making purchases and
5-24     expenditures by and for the [hospital] district, and also shall
5-25     prescribe all accounting and control procedures; the method of
5-26     purchasing necessary supplies, materials and equipment; and shall
5-27     have the power to adopt a seal for such district; and may employ a
5-28     general manager, and such professional and clerical assistance as
5-29     may be necessary.
5-30           (d)  The board of directors may purchase or lease property,
5-31     facilities, or equipment for the district to use in the health care
5-32     system and may mortgage or pledge the property, facilities, or
5-33     equipment as security for the payment of the purchase price.
5-34           (e)  The board of directors may enter into one or more
5-35     contracts to provide administrative and other personnel for the
5-36     operation of the health care facilities for a term not to exceed
5-37     five years.
5-38           (f)  The board of directors may transfer district health care
5-39     facilities by lease to individuals, corporations, or other legal
5-40     entities for a term not to exceed 20 years.
5-41           (g)  The board of directors may sell or otherwise dispose of
5-42     the district's property, facilities, and equipment.
5-43           (h)  The board of directors may provide retirement benefits
5-44     for the employees of the district by establishing or administering
5-45     a retirement program or electing to participate in the Texas County
5-46     and District Retirement System or any other statewide retirement
5-47     system in which the district is eligible to participate.
5-48           (i)  The board of directors may spend district funds to
5-49     recruit physicians, nurses, and other trained medical personnel.
5-50     The board of directors may contract with one or more full-time
5-51     medical students or other students in a health occupation, each of
5-52     whom is enrolled in good standing in an accredited medical school,
5-53     college, or university, to pay the student's tuition or other
5-54     expenses in consideration of the student's contractual agreement to
5-55     serve as an employee or independent contractor for the district
5-56     under terms prescribed by the contract.
5-57           (j)  The board of directors may institute a suit to enforce
5-58     the payment of taxes and to foreclose liens to secure the payment
5-59     of taxes due to the district.
5-60           (k)  The board of directors may spend district funds to
5-61     support emergency medical services in the county.
5-62           (l)  The board of directors may provide access to medical
5-63     care to nonindigent residents of Garza County if the nonindigent
5-64     residents are charged the reasonable and customary cost of
5-65     services.
5-66           SECTION 8.  Section 9, Chapter 502, Acts of the 60th
5-67     Legislature, Regular Session, 1967, is amended to read as follows:
5-68           Sec. 9.  (a)  The fiscal year of the [hospital] district
5-69     authorized to be established by the provisions hereof shall
 6-1     commence on October 1st of each year and end on September 30th of
 6-2     the following year.  The district directors shall cause an annual
 6-3     independent audit to be made of the books and records of the
 6-4     district, such audit to be made covering such fiscal year[, and the
 6-5     same shall be filed with the Comptroller of Public Accounts of the
 6-6     State of Texas and at the office of the district not later than
 6-7     December 31st of each year].
 6-8           (b)  The board of directors shall each year cause a budget to
 6-9     be prepared showing the proposed expenditures and disbursements and
6-10     the estimated receipts and collections for the following fiscal
6-11     year and shall hold a public hearing on the proposed budget after
6-12     publication of a notice of hearing in a newspaper of general
6-13     circulation in the county in accordance with Chapter 551,
6-14     Government Code [at least once not less than 10 days prior to the
6-15     date set for the hearing].  Any person who is a resident [taxpayer]
6-16     of the district shall have the right to appear at the time and
6-17     place designated in the notice and be heard with reference to any
6-18     item shown in the proposed budget.  The proposed budget shall also
6-19     show the amount of taxes required to be levied and collected during
6-20     such fiscal year and upon final approval of the budget, the board
6-21     of directors shall levy such tax as may be required and certify the
6-22     tax rate for such year to the county tax assessor and collector as
6-23     provided in Section 5 hereof, and it shall be the duty of the said
6-24     tax assessor and collector to assess and collect such tax.
6-25           SECTION 9.  Section 10, Chapter 502, Acts of the 60th
6-26     Legislature, Regular Session, 1967, is amended to read as follows:
6-27           Sec. 10.   Within 30 days after appointment and qualification
6-28     of the board of directors of the [hospital] district, the said
6-29     directors shall by resolution designate a bank or banks [within
6-30     Garza County] as the district's depository or treasurer and all
6-31     funds of the district shall be secured in the manner now provided
6-32     for the security of county funds.  The depository shall serve for a
6-33     period of two years and until a successor has been named.
6-34           SECTION 10.  Section 11, Chapter 502, Acts of the 60th
6-35     Legislature, Regular Session, 1967, is amended to read as follows:
6-36           Sec. 11.   The [hospital] district established or maintained
6-37     under the provisions of this Act shall be subject to inspection by
6-38     any duly authorized representative of the Texas Department [State
6-39     Board] of Health [or any State Board of Charities (or Public
6-40     Welfare) that now exists or that may be hereafter created], and any
6-41     resident officers shall admit such representatives into all
6-42     [hospital] district facilities and give them access on demand to
6-43     all records, reports, books, papers, and accounts pertaining to the
6-44     [hospital] district.
6-45           SECTION 11.  Section 12, Chapter 502, Acts of the 60th
6-46     Legislature, Regular Session, 1967, is amended to read as follows:
6-47           Sec. 12.   After the [hospital] district has been organized
6-48     pursuant to this Act, neither Garza County nor any city therein
6-49     shall levy any tax for health care [hospital] purposes; and such
6-50     [hospital] district shall be deemed to have assumed full
6-51     responsibility for the furnishing of medical and health [hospital]
6-52     care for the needy and indigent persons residing in said [hospital]
6-53     district from the date that taxes are collected for the [hospital]
6-54     district.
6-55           SECTION 12.  Section 13, Chapter 502, Acts of the 60th
6-56     Legislature, Regular Session, 1967, is amended to read as follows:
6-57           Sec. 13.   Whenever a patient claiming indigence has been
6-58     admitted to the facilities of the [hospital] district, the
6-59     directors shall cause inquiry to be made as to the patient's [his]
6-60     circumstances, and of the relatives of such patients legally liable
6-61     for the patient's [his] support.  If it is found that such patient
6-62     or said relatives are liable to pay for the patient's [his] care
6-63     and treatment in whole or in part, an order shall be made directing
6-64     such patient, or said relatives, to pay to the treasurer of the
6-65     [hospital] district for the support of such patient a specified sum
6-66     per week, in proportion to their financial ability, but such sum
6-67     shall not exceed the actual per capita cost of maintenance.  The
6-68     district shall have power and authority to collect such sum from
6-69     the estate of the patient, or the patient's [his] relatives legally
 7-1     liable for the patient's [his] support, in the manner provided by
 7-2     law for the collection of expenses of the last illness of a
 7-3     deceased person. If the agent designated by the district to handle
 7-4     such affairs finds that such patient or said relatives are not able
 7-5     to pay, either in whole or in part, for the patient's [his] care
 7-6     and treatment in such health care facility [hospital], the same
 7-7     shall become a charge upon the [hospital] district.  Should there
 7-8     be a dispute as to the ability to pay, or doubt in the mind of the
 7-9     person designated as aforesaid, the district's directors shall hear
7-10     and determine same, after calling witnesses, and shall make such
7-11     order as may be proper, from which appeal shall lie to the district
7-12     court.
7-13           SECTION 13.  Section 14, Chapter 502, Acts of the 60th
7-14     Legislature, Regular Session, 1967, is amended to read as follows:
7-15           Sec. 14.   The board of directors of the [hospital] district
7-16     is authorized on behalf of said [hospital] district to accept
7-17     donations, gifts and endowments for the [hospital] district to be
7-18     held in trust and administered by the board of directors for such
7-19     purposes and under such direction, limitations, and provisions as
7-20     may be prescribed in writing by donor, not inconsistent with proper
7-21     management and objects of the [hospital] district.
7-22           SECTION 14.  Section 16, Chapter 502, Acts of the 60th
7-23     Legislature, Regular Session, 1967, is amended to read as follows:
7-24           Sec. 16.   The [hospital] district authorized to be created
7-25     under the provisions of this Act shall be and is declared to be
7-26     political subdivision of the State of Texas, and as a governmental
7-27     agency may sue and be sued in any and all courts of this state in
7-28     the name of such district.  In addition, all property owned by said
7-29     district shall be held for public purposes and shall be exempt from
7-30     taxation of every character.
7-31           SECTION 15.   Chapter 502, Acts of the 60th Legislature,
7-32     Regular Session, 1967, is amended by adding Sections 16A and 16B to
7-33     read as follows:
7-34           Sec. 16A.  (a)  The board of directors may borrow money at a
7-35     rate not to exceed the maximum annual percentage rate allowed by
7-36     law for district obligations at the time of the loan.
7-37           (b)  To secure a loan, the board of directors may pledge:
7-38                 (1)  the revenues of the district that are not pledged
7-39     to pay the bonded indebtedness of the district;
7-40                 (2)  district taxes to be levied by the district during
7-41     the 12-month period following the date of the pledge that are not
7-42     pledged to pay the principal of or interest on district bonds; or
7-43                 (3)  district bonds that have been authorized but not
7-44     sold.
7-45           (c)  A loan for which taxes or bonds are pledged shall mature
7-46     not later  than the first anniversary of the date on which the loan
7-47     is made.  A loan for which district revenues are pledged shall
7-48     mature not later than the fifth anniversary of the date on which
7-49     the loan is made.
7-50           Sec. 16B.  (a)  The district may be dissolved only if the
7-51     dissolution is approved by a majority of the qualified voters of
7-52     the district voting in an election called and held for that
7-53     purpose.
7-54           (b)  The board of directors may order an election on the
7-55     question of dissolving the district and disposing of the district's
7-56     assets and obligations.  The board of directors shall order an
7-57     election if the board receives a petition requesting an election
7-58     that is signed by a number of registered voters of the district
7-59     equal to at least 10 percent of the registered voters in the
7-60     district.
7-61           (c)  The election shall be held not later than the 60th day
7-62     after the date the election is ordered.  Section 41.001(a),
7-63     Election Code, does not apply to an election ordered under this
7-64     section.  The order calling the election shall state:
7-65                 (1)  the nature of the election, including the
7-66     proposition that is to appear on the ballot;
7-67                 (2)  the date of the election;
7-68                 (3)  the hours during which the polls will be open; and
7-69                 (4)  the location of the polling places.
 8-1           (d)  The board of directors shall give notice of the election
 8-2     by publishing a substantial copy of the election order in a
 8-3     newspaper of general circulation in the district once a week for
 8-4     two consecutive weeks.  The first publication must appear not fewer
 8-5     than 35 days before the date set for the election.  The ballot for
 8-6     the election shall be printed to permit voting for or against the
 8-7     proposition: "The dissolution of the Garza County Health Care
 8-8     District."
 8-9           (e)  If a majority of the votes in the election favor
8-10     dissolution, the board of directors shall find that the district is
8-11     dissolved.  If a majority of the votes in the election do not favor
8-12     dissolution, the board of directors shall continue to administer
8-13     the district, and another election on the question of dissolution
8-14     may not be held before the first anniversary of the most recent
8-15     election to dissolve the district.
8-16           (f)  If a majority of the votes in the election favor
8-17     dissolution, the board of directors shall:
8-18                 (1)  transfer the land, buildings, improvements,
8-19     equipment, and other assets that belong to the district to Garza
8-20     County or another governmental entity in Garza County;
8-21                 (2)  sell the assets and liabilities to another person
8-22     or entity; or
8-23                 (3)  administer the property, assets, and debts until
8-24     all funds have been disposed of and all district debts have been
8-25     paid or settled.
8-26           (g)  If the district transfers the land, buildings,
8-27     improvements, equipment, and other assets to Garza County or
8-28     another governmental entity in Garza County, the county or entity
8-29     assumes all debts and obligations of the district at the time of
8-30     the transfer, at which time the district is dissolved.  If the
8-31     district does not transfer the land, buildings, improvements,
8-32     equipment, and other assets to Garza County or another governmental
8-33     entity in Garza County, or sell those assets and the liabilities to
8-34     another person or entity, the board of directors shall administer
8-35     the property, assets, and debts of the district until all funds
8-36     have been disposed of and all district debts have been paid or
8-37     settled, at which time the district is dissolved.
8-38           (h)  After the board of directors finds that the district is
8-39     dissolved, the board of directors shall:
8-40                 (1)  determine the debt owed by the district; and
8-41                 (2)  impose on the property included in the district's
8-42     tax rolls a tax that is in proportion of the debt to the property
8-43     value.
8-44           (i)  When all outstanding debts and obligations of the
8-45     district are paid, the board of directors shall order the secretary
8-46     to return the pro rata share of all unused tax money to each
8-47     district taxpayer.
8-48           (j)  A taxpayer may request that the taxpayer's share of
8-49     surplus tax money be credited to the taxpayer's county taxes.  If a
8-50     taxpayer requests the credit, the board of directors shall direct
8-51     the secretary to transmit the funds to the county tax
8-52     assessor-collector.
8-53           (k)  After the district has paid all its debts and has
8-54     disposed of all its assets and funds as prescribed by this section,
8-55     the board of directors shall file a written report with the
8-56     Commissioners Court of Garza County setting forth a summary of the
8-57     board of directors' actions in dissolving the district.
8-58           (l)  Not later than the 10th day after the date it receives
8-59     the report and determines that the requirements of this section
8-60     have been fulfilled, the Commissioners Court of Garza County shall
8-61     enter an order dissolving the district and releasing the board of
8-62     directors from any further duty or obligation.
8-63           (m)  The district may provide for the sale or transfer of the
8-64     district's assets and liabilities to another person or entity and
8-65     the district's subsequent dissolution.  The dissolution of the
8-66     district and the sale or transfer of the district's assets and
8-67     liabilities to another person or entity may not contravene a trust
8-68     indenture or bond resolution relating to the outstanding bonds of
8-69     the district.  The dissolution and sale or transfer does not
 9-1     diminish or impair the rights of a holder of an outstanding bond,
 9-2     warrant, or other obligation of the district.
 9-3           (n)  The sale or transfer of the district's assets and
 9-4     liabilities must satisfy the debt and bond obligations of the
 9-5     district in a manner that protects the interests of the residents
 9-6     of the district, including the residents' collective property
 9-7     rights in the district's assets.  A grant from federal funds is an
 9-8     obligation to be repaid in satisfaction.  The district may not
 9-9     transfer or dispose of the district's assets except for due
9-10     compensation unless the transfer is made to another governmental
9-11     entity that serves the district and the transferred assets are to
9-12     be used for the benefit of the residents of the district.
9-13           SECTION 16.  This Act takes effect September 1, 2001.
9-14                                  * * * * *