1-1     By:  Craddick (Senate Sponsor - Duncan)               H.B. No. 3661
 1-2           (In the Senate - Received from the House April 30, 2001;
 1-3     May 1, 2001, read first time and referred to Committee on
 1-4     Intergovernmental Relations; May 4, 2001, reported favorably by the
 1-5     following vote:  Yeas 6, Nays 0; May 4, 2001, sent to printer.)
 1-6                            A BILL TO BE ENTITLED
 1-7                                   AN ACT
 1-8     relating to the powers, duties, and board of managers of the Reagan
 1-9     Hospital District of Reagan County, Texas.
1-10           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-11           SECTION 1. Section 5, Chapter 29, Acts of the 65th
1-12     Legislature, Regular Session, 1977, is amended to read as follows:
1-13           Sec. 5. (a)  The board of directors consists of six members
1-14     with one director elected from each commissioners precinct of
1-15     Reagan County and two directors elected from the district at large.
1-16     A director elected from a commissioners precinct is not required to
1-17     be a resident of that commissioners precinct.  The directors serve
1-18     three-year staggered terms.  [On the effective date of this Act,
1-19     the following persons shall constitute the temporary directors of
1-20     the district:]
1-21                 [1.  Frank Sandel;]
1-22                 [2.  E. G. Cauble, Jr.;]
1-23                 [3.  Wade Jones;]
1-24                 [4.  Buck Schaible;]
1-25                 [5.  Mike Elkins; and]
1-26                 [6.  Jack Black.]
1-27           [(b)  Each of the directors shall execute the constitutional
1-28     oath of office within 60 days of the effective date of this Act.
1-29     Should any of the named directors refuse to act or for any reason
1-30     fail to qualify as required, the remaining temporary directors
1-31     shall by majority vote appoint a successor or successors to fill
1-32     the vacancy.  The terms of the first, third, and fifth named
1-33     directors shall expire on the first Saturday in April of the year
1-34     following the election creating the district, and the terms of the
1-35     second, fourth, and sixth named directors shall expire on the first
1-36     Saturday in April of the second year following the election
1-37     creating the district.  Successors shall be elected by a vote of
1-38     the electors of the entire district for two-year terms.]
1-39           [(c)  When the creation of the district is approved and the
1-40     returns of the election are officially canvassed, the persons
1-41     acting as temporary directors become permanent directors whose
1-42     terms expire as provided in Subsection (b) of this section.]  Each
1-43     permanent director and the director's [his] successor in office
1-44     shall qualify by executing the constitutional oath of office.
1-45           (b)  A redistricting or other change in the boundaries of the
1-46     commissioners precincts of Reagan County does not affect the
1-47     service or term of a member of the district's board of directors in
1-48     office when the change occurs.  The change in the commissioners
1-49     precincts applies to each election of directors occurring after the
1-50     change takes effect as the terms of directors then in office
1-51     expire.
1-52           (c) [(d)]  No person may be appointed or elected as a member
1-53     of the board of directors of the hospital district unless the
1-54     person [he] is a resident of the district and a qualified voter
1-55     [thereof and owns property subject to taxation therein and unless
1-56     at the time of such election or appointment he shall be more than
1-57     18 years of age].
1-58           (d) [(e)]  The board of directors shall organize by electing
1-59     one of their number as president, one of their number as
1-60     vice-president, and a secretary, who need not be a director.
1-61     Officers are elected for a term of one year and vacancies shall be
1-62     filled for the unexpired term by vote of the board.  Any four
1-63     members of the board of directors constitute a quorum and a
1-64     concurrence of four is sufficient in all matters pertaining to the
 2-1     business of the district.  All vacancies in the office of director
 2-2     shall be filled for the unexpired term by appointment by the
 2-3     remainder of the board of directors and each appointee holds office
 2-4     for the unexpired term for which the person was appointed.  If the
 2-5     number of directors is reduced to less than five, the remaining
 2-6     directors shall immediately call a special election to fill the
 2-7     vacancies, and upon their failure to do so, the district court, on
 2-8     application of any resident [elector or taxpayer] of the district,
 2-9     shall order the election.
2-10           (e) [(f)]  A regular election of directors shall be held on
2-11     the first [third] Saturday in May of each year, and shall be
2-12     ordered by the board in accordance with the applicable provisions
2-13     of Chapter 3, Election Code.  Notice [notice] of the election shall
2-14     be published in a newspaper of general circulation in the district
2-15     [county] one time in accordance with Chapter 4, Election Code [at
2-16     least 10 days prior to the date of election].  Any person desiring
2-17     the person's [his] name to be printed on the ballot as a candidate
2-18     for director shall file an application with the secretary of the
2-19     board in accordance with Chapter 144, Election Code, asking that
2-20     the person's [his] name be printed on the ballot.  The application
2-21     must specify the commissioners precinct for which the person is
2-22     applying to be a candidate or state that the person is applying to
2-23     be a candidate for election to an at-large position [The
2-24     application must be filed not later than 5 p.m. of the 45th day
2-25     before the date on which the election is held].
2-26           SECTION 2.  Section 6, Chapter 29, Acts of the 65th
2-27     Legislature, Regular Session, 1977, is amended to read as follows:
2-28           Sec. 6. (a)  The board of directors shall manage, control,
2-29     and administer the hospital system and all funds and resources of
2-30     the district, but operating, depreciation, or building fund
2-31     reserves may not be invested in any funds or securities other than
2-32     those specified in Chapter 2256, Government Code [Articles 836 and
2-33     837, Revised Civil Statutes of Texas, 1925, as amended].
2-34           (b)  The board is given full authority to establish rules and
2-35     regulations relating to seniority of employees of the district, and
2-36     may establish or administer a retirement program or elect to
2-37     participate in any statewide retirement program in which the
2-38     district is eligible to participate.
2-39           (c)  The district may give effect to previous years of
2-40     service for those employees who have been continuously employed in
2-41     the operation or management of the hospital facilities acquired
2-42     from the county or any city or town on the creation of the
2-43     district.  The district, through its board of directors, shall have
2-44     the power and authority to sue and be sued and to promulgate rules
2-45     governing the operation of the hospital, hospital system, its
2-46     staff, and employees.
2-47           (d)  The board of directors may appoint a qualified person to
2-48     be known as the administrator of the hospital district and may in
2-49     its discretion appoint assistants to the administrator.  The
2-50     administrator and assistant administrator, if any, serve at the
2-51     will of the board and receive compensation fixed by the board.  The
2-52     administrator shall, on assuming the [his] duties of administrator,
2-53     execute a bond payable to the hospital district in an amount set by
2-54     the board of directors, not less than $5,000, conditioned on
2-55     performance of the duties required of the administrator [him], and
2-56     containing other conditions as the board may require.  The board
2-57     may pay for the bond with district funds.  The administrator shall
2-58     supervise all the work and activities of the district and shall
2-59     have general direction of the affairs of the district, subject to
2-60     the limitations prescribed by the board.
2-61           (e)  The board of directors shall have the authority to
2-62     appoint, dismiss from the staff, or contract with doctors as it
2-63     deems necessary for the efficient operation of the district, and
2-64     may provide for temporary appointments to the staff if warranted by
2-65     circumstances.
2-66           (f)  The board may delegate to the administrator the
2-67     authority to employ technicians, nurses, and employees of the
2-68     district.
2-69           (g)  The board shall be authorized to contract with any other
 3-1     political subdivision or governmental agency whereby the district
 3-2     will provide investigatory or other services as to the medical,
 3-3     hospital, or welfare needs of the inhabitants of the district and
 3-4     shall be authorized to contract with any county or incorporated
 3-5     municipality located outside its boundaries for the hospitalization
 3-6     and treatment of the sick, diseased, or injured persons of any such
 3-7     county or municipality, and shall have the authority to contract
 3-8     with the state or agencies of the federal government for the
 3-9     hospital treatment of sick, diseased, or injured persons.
3-10           (h)  The board of directors may purchase or lease property,
3-11     facilities, and equipment for the district to use in the hospital
3-12     system and may mortgage or pledge the property, facilities, or
3-13     equipment as security for the payment of the purchase price.
3-14           (i)  The board of directors may spend district funds, enter
3-15     into agreements, and take other necessary action to recruit
3-16     physicians and other persons to serve as medical staff members or
3-17     employees of the district, including:
3-18                 (1)  advertising and marketing;
3-19                 (2)  paying travel, recruitment, and relocation
3-20     expenses;
3-21                 (3)  providing a loan or scholarship to a physician or
3-22     a person currently enrolled in health care education courses at an
3-23     institution of higher education who contractually agrees to become
3-24     a district employee or medical staff member; or
3-25                 (4)  contracting with one or more full-time medical
3-26     students or other students in a health occupation, each of whom
3-27     must be enrolled in and in good standing at an accredited medical
3-28     school, college, or university, to pay the student's tuition or
3-29     other expenses in consideration of the student's agreement to serve
3-30     as an employee or independent contractor for the district.
3-31           (j)  The board may institute a suit to enforce the payment of
3-32     taxes and to foreclose liens to secure the payment of taxes due to
3-33     the district.
3-34           (k)  The board may provide or contract for the provision of
3-35     educational programs or courses for employees and medical staff of
3-36     the district.
3-37           (l)  The board may institute a suit to collect amounts owed
3-38     to the district by patients who have not been determined to be
3-39     unable to pay under Section 18.
3-40           (m)  The district may sponsor and create a nonprofit
3-41     corporation under the Texas Non-Profit Corporation Act (Article
3-42     1396-1.01 et seq., Vernon's Texas Civil Statutes) and may
3-43     contribute funds to or solicit funds for the corporation.  The
3-44     corporation may use its funds only to provide health care or other
3-45     services the district is authorized to provide under this Act.  The
3-46     board of directors of the hospital district shall establish
3-47     adequate controls to ensure that the corporation uses its funds as
3-48     required by this subsection.  The corporation may invest
3-49     corporation funds in any manner in which the district may invest
3-50     funds, including investing funds as authorized by Chapter 2256,
3-51     Government Code.
3-52           (n)  The directors may participate in any group health
3-53     insurance plan sponsored by the district for district employees.
3-54           SECTION 3.  Section 7, Chapter 29, Acts of the 65th
3-55     Legislature, Regular Session, 1977, is amended to read as follows:
3-56           Sec. 7. (a)  The district shall be operated on the basis of a
3-57     fiscal year established by the board.  The fiscal year may not be
3-58     changed when revenue bonds are outstanding or more than one time in
3-59     a 24-month period.
3-60           (b)  The board [commencing on October 1 of each year and
3-61     ending on September 30 of the following year, and every fiscal
3-62     year, it] shall cause an independent audit to be made annually of
3-63     the books and records [financial condition] of the district.  The
3-64     audit [, which], together with other records of the district, shall
3-65     be open to inspection at the principal office of the district.
3-66           (c)  The administrator shall prepare an annual budget for
3-67     approval by the board of directors.  The budget shall [also]
3-68     contain a complete financial statement of the district showing all
3-69     outstanding obligations of the district, the cash on hand to the
 4-1     credit of each fund of the district, the funds received from all
 4-2     sources during the previous year, the funds available from all
 4-3     sources during the ensuing year, with balances expected at year end
 4-4     of the year in which the budget is being prepared, estimated
 4-5     revenues and balances available to cover the proposed budget, the
 4-6     estimated tax rate which will be required, and the proposed
 4-7     expenditures, disbursements, and estimated receipts and collections
 4-8     for the following fiscal year.  A public hearing on the annual
 4-9     budget shall be held by the board of directors after notice of the
4-10     hearing has been published one time at least 10 days before the
4-11     date set for the hearing in a newspaper of [or newspapers which
4-12     individually or collectively provide] general circulation in the
4-13     hospital district.  Any resident [property taxpayer] of the
4-14     district shall have the right to be present and participate in the
4-15     hearing.  At the conclusion of the hearing, the budget, as proposed
4-16     by the administrator, shall be acted on by the board of directors.
4-17     The board of directors shall have authority to make such changes in
4-18     the budget as in their judgment the law warrants and the interest
4-19     of the taxpayers demand.  No expenditure may be made for any
4-20     expense not included in the annual budget or an amendment to it.
4-21     The annual budget may be amended from time to time as the
4-22     circumstances may require, but the annual budget, and all
4-23     amendments, shall be approved by the board of directors.
4-24           (d)  As soon as practicable after the close of each fiscal
4-25     year, the administrator shall prepare for the board a full sworn
4-26     statement of all moneys belonging to the district and a full
4-27     account of disbursements.
4-28           SECTION 4.  Section 8, Chapter 29, Acts of the 65th
4-29     Legislature, Regular Session, 1977, is amended to read as follows:
4-30           Sec. 8. (a)  The board of directors shall have the power to
4-31     issue and sell general obligation [its] bonds authorized by an
4-32     election in the name and on the faith and credit of the hospital
4-33     district for the purchase, construction, acquisition, repair, or
4-34     renovation of buildings and improvements, [and] equipping the
4-35     buildings and improvements, and acquisition of sites to be used for
4-36     district [them for hospital] purposes.  At the time of the issuance
4-37     of any general obligation bonds by the district, a tax shall be
4-38     levied by the board sufficient to create an interest and sinking
4-39     fund to pay the interest on and principal of the bonds as they
4-40     mature, providing the tax, together with any other taxes levied for
4-41     the district, shall not exceed 75  on each $100 valuation in any
4-42     year [the rate of tax approved under Section 4 of this Act].  No
4-43     general obligation bonds shall be issued by the hospital district
4-44     [except refunding bonds] until authorized by a majority of the
4-45     qualified voters [electors] of the district voting at an election
4-46     called for that purpose.  The election shall be conducted in
4-47     accordance with Chapter 1251, Government Code.  [The order for bond
4-48     election shall specify the date of the election, the amount of
4-49     bonds to be authorized, the maximum maturity date and rate of
4-50     interest they are to bear, the place or places where the election
4-51     shall be held, the presiding judge and alternate judge for each
4-52     voting place, and shall provide for clerks as in county elections.
4-53     Except for a bond election held under Subsection (b) of this
4-54     section, in which case notice shall be given as provided in Section
4-55     4, notice of any bond election shall be given as provided in
4-56     Article 704, Revised Civil Statutes of Texas, 1925, as amended, and
4-57     shall be conducted in accordance with the Texas Election Code, as
4-58     amended, except as modified by the provisions of this Act.]
4-59           (b)  A separate proposition on the request of the temporary
4-60     directors may be submitted at the election for the confirmation of
4-61     the district as to whether the board of directors, in the event the
4-62     district is created, shall be authorized to issue bonds for the
4-63     purposes specified in this section.  The proposition, if submitted,
4-64     shall specify the purpose for which the bonds are to be issued, the
4-65     maximum amount of bonds then proposed to be issued, the maximum
4-66     maturity date, and the maximum interest rate.
4-67           (c)  The board may issue refunding bonds of the district for
4-68     the purpose of refunding and paying off any outstanding
4-69     indebtedness issued or assumed.  The board shall issue refunding
 5-1     bonds in accordance with Chapter 1207, Government Code.  [The
 5-2     refunding bonds may be sold and the proceeds applied to the payment
 5-3     of outstanding indebtedness, or may be exchanged in whole or in
 5-4     part for not less than a like principal amount of outstanding
 5-5     indebtedness, provided that, if refunding bonds are to be exchanged
 5-6     for a like amount of the outstanding indebtedness, the refunding
 5-7     bonds shall bear interest at the same or lower rate than borne by
 5-8     the debt refunded, unless it is shown mathematically that a saving
 5-9     will result in the total amount of interest to be paid on the
5-10     refunding bonds.  If refunding bonds are to be sold and the
5-11     proceeds thereof applied to the payment of any such outstanding
5-12     indebtedness, they shall be issued and payments made in the manner
5-13     specified by Chapter 503, Acts of the 54th Legislature, 1955, as
5-14     amended (Article 717k, Vernon's Texas Civil Statutes).]
5-15           (d)  Bonds of the district shall bear interest at a rate not
5-16     to exceed the rate provided by Chapter 1204, Government Code, shall
5-17     mature within 40 years of their date, shall be executed in the name
5-18     of the hospital district and in its behalf by the president of the
5-19     board and countersigned by the secretary in the manner provided by
5-20     Chapter 618, Government Code, as added by Chapter 227, Acts of the
5-21     76th Legislature, Regular Session, 1999 [Chapter 204, Acts of the
5-22     57th Legislature, Regular Session, 1961 (Article 717j-1, Vernon's
5-23     Texas Civil Statutes)], and shall be subject to the same
5-24     requirements in the matter of approval by the attorney general and
5-25     registration by the comptroller of public accounts as are by law
5-26     provided for approval and registration of bonds issued by counties.
5-27     On the approval of the bonds by the attorney general and
5-28     registration by the comptroller, they are incontestable for any
5-29     cause.
5-30           SECTION 5.  Section 9, Chapter 29, Acts of the 65th
5-31     Legislature, Regular Session, 1977, is amended to read as follows:
5-32           Sec. 9. The board of directors is authorized to issue revenue
5-33     bonds and refund any previously issued revenue bonds for
5-34     purchasing, constructing, acquiring, repairing, equipping, or
5-35     renovating buildings and improvements for district [hospital]
5-36     purposes, and for acquiring sites for them, the bonds to be payable
5-37     from and secured by a pledge of all or any part of the revenues of
5-38     the district to be derived from the operation of its hospital
5-39     system [or hospitals].  The bonds may be additionally secured by a
5-40     mortgage or deed of trust lien on any part or all of its
5-41     properties.  The bonds shall be issued in the manner and in
5-42     accordance with the procedures and requirements specified for the
5-43     issuance of revenue bonds by county hospital authorities in
5-44     Sections 264.042, 264.043, 264.044, 264.046, 264.047, 264.048, and
5-45     264.049, Health and Safety Code [8, 10, 11, 12, and 13 of Chapter
5-46     122, Acts of the 58th Legislature, 1963, as amended (Article 4494r,
5-47     Vernon's Texas Civil Statutes)].
5-48           SECTION 6.  Section 11, Chapter 29, Acts of the 65th
5-49     Legislature, Regular Session, 1977, is amended to read as follows:
5-50           Sec. 11. The board of directors has the power to prescribe
5-51     the method and manner of making purchases and expenditures by and
5-52     for the hospital district, and shall also be authorized to
5-53     prescribe all accounting and control procedures.  All contracts for
5-54     construction in excess of the amount provided by Section 271.024,
5-55     Local Government Code, [or purchases involving the expenditure of
5-56     more than $5,000] may be made only after competitive bidding
5-57     [advertising] in the manner provided by Subchapter B, Chapter 271,
5-58     Local Government Code.  The provisions of Chapter 2253, Government
5-59     Code, relating to performance and payment bonds, applies [Chapter
5-60     163, General Laws, Acts of the 42nd Legislature, Regular Session,
5-61     1931 (Article 2368a, Vernon's Texas Civil Statutes).  The
5-62     provisions of Article 5160, Revised Statutes, apply] to
5-63     construction contracts let by the district.  The district may
5-64     acquire equipment for use in its hospital system and mortgage or
5-65     pledge the property so acquired as security for the payment of the
5-66     purchase price, but any such contract shall provide for the entire
5-67     obligation of the district to be retired within five years from the
5-68     date of the contract.  Except as otherwise provided by this Act
5-69     [permitted in the preceding sentence and as permitted by Sections 8
 6-1     and 9], the district may incur no obligation payable from any
 6-2     revenues of the district, taxes or otherwise, except those on hand
 6-3     or to be on hand within the current and following fiscal year of
 6-4     the district.
 6-5           SECTION 7.  Section 12(a), Chapter 29, Acts of the 65th
 6-6     Legislature, Regular Session, 1977, is amended to read as follows:
 6-7           (a)  The board of directors of the district shall name one or
 6-8     more banks [within its boundaries] to serve as depository for the
 6-9     funds of the district.  All funds of the district, except those
6-10     invested as provided in Section 6 of this Act, and those
6-11     transmitted to a bank or banks as payment for bonds or obligations
6-12     issued by the district, shall be deposited as received with the
6-13     depository bank and shall remain on deposit, provided that nothing
6-14     in this Act shall limit the power of the board to place a portion
6-15     of such funds on time deposit or purchase certificates of deposit.
6-16           SECTION 8.  Section 15(a), Chapter 29, Acts of the 65th
6-17     Legislature, Regular Session, 1977, is amended to read as follows:
6-18           (a)  The district has the right and power of eminent domain
6-19     for the purpose of acquiring by condemnation property of any kind
6-20     and character in fee simple, or any lesser interest, within the
6-21     boundaries of the district necessary or convenient to the powers,
6-22     rights, and privileges conferred by this Act, in the manner
6-23     provided by the general law with respect to condemnation by
6-24     counties, provided that the district shall not be required to make
6-25     bond or deposits in the registry of the trial court as required by
6-26     Section 21.021, Property Code [Paragraph 2 of Article 3268, Revised
6-27     Civil Statutes of Texas, 1925, as amended].  In condemnation
6-28     proceedings being prosecuted by the district, the district shall
6-29     not be required to pay in advance or give bond or other security
6-30     for costs in the trial court, nor to give any bond otherwise
6-31     required for the issuance of a temporary restraining order or a
6-32     temporary injunction nor to give bond for costs or for supersedeas
6-33     on any appeal or writ of error.
6-34           SECTION 9.  Section 16, Chapter 29, Acts of the 65th
6-35     Legislature, Regular Session, 1977, is amended to read as follows:
6-36           Sec. 16. [(a)]  The directors shall have the authority to
6-37     levy taxes for the entire year in which the district is
6-38     established.  The Tax Code governs the appraisal of property for
6-39     and assessment and collection of district taxes.  The board may
6-40     provide for the appointment of a tax assessor-collector for the
6-41     district or may contract for the assessment and collection of taxes
6-42     as provided by the Tax Code [All taxes of the district shall be
6-43     assessed and collected on county tax values as provided in
6-44     Subsection (b) of this section unless the directors, by majority
6-45     vote, elect to have taxes assessed and collected by the district's
6-46     own tax assessor-collector under Subsection (c) of this section.
6-47     Any such election may be made prior to December 1 annually and
6-48     shall govern the manner in which taxes are assessed and collected
6-49     until changed by a similar resolution.]
6-50           [(b)  Under this subsection, district taxes shall be assessed
6-51     and collected on county tax values in the same manner as provided
6-52     by law with relation to county taxes.  The tax assessor-collector
6-53     of the county in which the district is situated is required to
6-54     accomplish the assessment and collection of all taxes levied by and
6-55     on behalf of the district.  The assessor-collector of taxes shall
6-56     charge and deduct from payments to the hospital district an amount
6-57     as fees for assessing and collecting the taxes, at a rate of up to
6-58     two percent of the amounts collected, as determined by the board of
6-59     directors, but the amount paid may not exceed $5,000 in any one
6-60     calendar year. The fees shall be deposited in the officers salary
6-61     fund of the county and reported as fees of office of the county tax
6-62     assessor-collector.  Interest and penalties on taxes paid to the
6-63     hospital district shall be the same as in the case of county taxes.
6-64     Discounts shall be the same as allowed by the county.  The residue
6-65     of tax collections after deduction of discounts and fees for
6-66     assessing and collecting shall be deposited in the district's
6-67     depository.  The bond of the county tax assessor-collector shall
6-68     stand as security for the proper performance of his duties as
6-69     assessor-collector of the district, or, if in the judgment of the
 7-1     board of directors it is necessary, additional bond payable to the
 7-2     district may be required.  In all matters pertaining to the
 7-3     assessment, collection, and enforcement of taxes for the district,
 7-4     the county tax assessor-collector is authorized to act in all
 7-5     respects according to the laws of the state relating to state and
 7-6     county taxes.]
 7-7           [(c)  Under this subsection, taxes shall be assessed and
 7-8     collected by a tax assessor-collector appointed by the directors,
 7-9     who shall also fix the terms of his employment, compensation, and
7-10     requirement for bond to assure the faithful performance of his
7-11     duties, but in no event may the bond be for less than $5,000].
7-12           SECTION 10.  Section 18, Chapter 29, Acts of the 65th
7-13     Legislature, Regular Session, 1977, is amended to read as follows:
7-14           Sec. 18.  When a patient residing within the district has
7-15     been admitted to the district's hospital facilities, the
7-16     administrator may cause inquiry to be made as to the patient's
7-17     [his] financial circumstances and those of the relatives of the
7-18     patient legally liable for the patient's [his] support.  If the
7-19     administrator [he] finds that the patient or the patient's [his]
7-20     relatives are able to pay for the patient's [his] care and
7-21     treatment in whole or in part, as determined by the district's
7-22     current indigent health care policy, an order shall be made
7-23     directing the patient or the patient's [his] relatives to pay to
7-24     the hospital district for the care and support of the patient a
7-25     specified sum each week in proportion to their financial ability.
7-26     The administrator shall have power and authority to collect the
7-27     sums from the estate of the patient or the patient's [his]
7-28     relatives legally liable for the patient's [his] support in the
7-29     manner provided by law for collection of expenses in the last
7-30     illness of a deceased person.  If the administrator finds that the
7-31     patient or the patient's [his] relatives are not able to pay either
7-32     in whole or in part for the patient's [his] care and treatment in
7-33     the hospital, it shall become a charge on the hospital district as
7-34     to the amount of the inability to pay.  Should there be any dispute
7-35     as to the ability to pay or doubt in the mind of the administrator
7-36     [or manager], the board of directors shall hear and determine the
7-37     issue after calling witnesses.  [Appeals from the final order of
7-38     the board lie to the district court.  The substantial evidence rule
7-39     applies.]
7-40           SECTION 11.  Chapter 29, Acts of the 65th Legislature,
7-41     Regular Session, 1977, is amended by adding Section 18A to read as
7-42     follows:
7-43           Sec. 18A. (a)  The district may be dissolved only if the
7-44     dissolution is approved by a majority of the qualified voters of
7-45     the district voting in an election called and held for that
7-46     purpose.
7-47           (b)  The board may order an election on the question of
7-48     dissolving the district and disposing of the district's assets and
7-49     obligations.  The board shall order an election if the board
7-50     receives a petition requesting an election that is signed by at
7-51     least 15 percent of the registered voters in the district.
7-52           (c)  The election shall be held not later than the 60th day
7-53     after the date the election is ordered.  Section 41.001(a),
7-54     Election Code, does not apply to an election ordered under this
7-55     section. The order calling the election shall state:
7-56                 (1)  the nature of the election, including the
7-57     proposition that is to appear on the ballot;
7-58                 (2)  the date of the election;
7-59                 (3)  the hours during which the polls will be open; and
7-60                 (4)  the location of the polling places.
7-61           (d)  The board shall give notice of the election by
7-62     publishing a substantial copy of the election order in a newspaper
7-63     with general circulation in the district once a week for two
7-64     consecutive weeks.  The first publication must appear not less than
7-65     35 days before the date set for the election.  The ballot for the
7-66     election shall be printed to permit voting for or against the
7-67     proposition: "The dissolution of the Reagan Hospital District of
7-68     Reagan County, Texas."
7-69           (e)  If a majority of the votes in the election favor
 8-1     dissolution, the board shall find that the district is dissolved.
 8-2     If a majority of the votes in the election do not favor
 8-3     dissolution, the board shall continue to administer the district,
 8-4     and another election on the question of dissolution may not be held
 8-5     before the first anniversary of the most recent election to
 8-6     dissolve the district.
 8-7           (f)  If a majority of the votes in the election favor
 8-8     dissolution, the board shall:
 8-9                 (1)  transfer the land, buildings, improvements,
8-10     equipment, and other assets that belong to the district to Reagan
8-11     County or to another governmental entity in Reagan County;
8-12                 (2)  sell the assets and liabilities to another person;
8-13     or
8-14                 (3)  administer the property, assets, and debts until
8-15     all funds have been disposed of and all district debts have been
8-16     paid or settled.
8-17           (g)  If the district transfers the land, buildings,
8-18     improvements, equipment, and other assets to a county or other
8-19     governmental entity, the county or entity assumes all debts and
8-20     obligations of the district at the time of the transfer and the
8-21     district is dissolved.  If the district does not transfer the land,
8-22     buildings, improvements, equipment, and other assets to a county or
8-23     other governmental entity, the board shall sell the assets and
8-24     liabilities to another person or administer the property, assets,
8-25     and debts of the district until all funds have been disposed of and
8-26     all district debts have been paid or settled, at which time the
8-27     district is dissolved.
8-28           (h)  After the board finds that the district is dissolved,
8-29     the board shall:
8-30                 (1)  determine the debt owed by the district; and
8-31                 (2)  impose on the property included in the district's
8-32     tax rolls a tax that is in proportion of the debt to the property
8-33     value.
8-34           (i)  When all outstanding debts and obligations of the
8-35     district are paid, the board shall order the secretary to return
8-36     the pro rata share of all unused tax money to each district
8-37     taxpayer.
8-38           (j)  A taxpayer may request that the taxpayer's share of
8-39     surplus tax money be credited to the taxpayer's county taxes.  If a
8-40     taxpayer requests the credit, the board shall direct the secretary
8-41     to transmit the funds to the county tax assessor-collector.
8-42           (k)  After the district has paid all its debts and has
8-43     disposed of all its assets and funds as prescribed by this section,
8-44     the board shall file a  written report with the Commissioners Court
8-45     of Reagan County setting forth a summary of the board's actions in
8-46     dissolving the district.
8-47           (l)  Not later than the 10th day after the date it receives
8-48     the report and determines that the requirements of this section
8-49     have been fulfilled, the Commissioners Court of Reagan County shall
8-50     enter an order dissolving the district and releasing the board of
8-51     directors of the district from any further duty or obligation.
8-52           (m)  The district may provide for the sale or transfer of the
8-53     district's assets and liabilities to another person or entity.  The
8-54     dissolution of the district and the sale or transfer of the
8-55     district's assets and liabilities to another person or entity may
8-56     not contravene a trust indenture or bond resolution relating to the
8-57     outstanding bonds of the district.  The dissolution and sale or
8-58     transfer does not diminish or impair the rights of a holder of an
8-59     outstanding bond, warrant, or other obligation of the district.
8-60           (n)  The sale or transfer of the district's assets and
8-61     liabilities must satisfy the debt and bond obligations of the
8-62     district in a manner that protects the interests of the residents
8-63     of the district, including the residents' collective property
8-64     rights in the district's assets.  A grant from federal funds is an
8-65     obligation to be repaid in satisfaction.  The district may not
8-66     transfer or dispose of the district's assets except for due
8-67     compensation unless the transfer is made to another governmental
8-68     entity that serves the district and the transferred assets are to
8-69     be used for the benefit of the residents of the district.
 9-1           SECTION 12. (a)  Before the date a person may file for a
 9-2     place on the ballot for election to  the board of directors of the
 9-3     Reagan Hospital District of Reagan County, Texas,  in 2002, the
 9-4     board shall establish staggered terms for the director positions
 9-5     and determine which director positions will be elected by place and
 9-6     which positions will be elected at-large. In establishing staggered
 9-7     terms for directors after the effective date of this Act, the board
 9-8     may provide for the term of a director then in office to continue
 9-9     as necessary until the first election after the effective date of
9-10     this Act for that director position.
9-11           (b)  The election of the members of the Board of Directors of
9-12     the  Reagan Hospital District of Reagan County, Texas, and any
9-13     governmental acts and proceedings of the district occurring before
9-14     the effective date of this Act are validated as of the dates they
9-15     occurred. The elections, acts, and proceedings may not be held
9-16     invalid because they were not performed in accordance with law.
9-17           (c)  This Act does not apply to any matter that on the
9-18     effective date of this Act:
9-19                 (1)  is involved in litigation if the litigation
9-20     ultimately results in the matter being held invalid by a final
9-21     judgment of a court of competent jurisdiction; or
9-22                 (2)  has been held invalid by a final judgment of a
9-23     court of competent jurisdiction.
9-24           SECTION 13.  This Act takes effect September 1, 2001.
9-25                                  * * * * *