77R14734 YDB-F                           
         By Dunnam                                             H.B. No. 3691
         Substitute the following for H.B. No. 3691:
         By Ramsay                                         C.S.H.B. No. 3691
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the creation, administration, powers, duties,
 1-3     operation, and financing of a hospital district to be known as the
 1-4     West Medical District; authorizing a tax; and granting the
 1-5     authority to issue and refund bonds.
 1-6           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-7                       ARTICLE 1.  GENERAL PROVISIONS
 1-8           SECTION 1.01.  DEFINITIONS.  In this Act:
 1-9                 (1)  "District" means the West Medical District.
1-10                 (2)  "Board" means the board of directors of the
1-11     district.
1-12                 (3)  "Director" means a member of the board.
1-13           SECTION 1.02.  DISTRICT AUTHORIZATION.  A hospital district
1-14     to be known as the West Medical District may be created and
1-15     established and, if created, must be maintained, operated, and
1-16     financed in the manner provided by Section 9, Article IX, Texas
1-17     Constitution, and by this Act.
1-18           SECTION 1.03.  BOUNDARIES.  The boundaries of the district
1-19     are coextensive with the boundaries of the West Independent School
1-20     District in McLennan County.
1-21           SECTION 1.04.  ELECTION CODE PROVISIONS. Section 41.001(a),
1-22     Election Code, does not apply to an election ordered under this
1-23     Act.
1-24                       ARTICLE 2.  TEMPORARY DIRECTORS
 2-1           SECTION 2.01.  TEMPORARY DIRECTORS.  On the effective date of
 2-2     this Act, the following persons become temporary directors of the
 2-3     district:
 2-4                 (1)  John Crowder;
 2-5                 (2)  Roby Urbanovsky;
 2-6                 (3)  Larry Sparks;
 2-7                 (4)  Jeanette Karlik;
 2-8                 (5)  Robby Payne;
 2-9                 (6)  Tommy Muska; and
2-10                 (7)  Kirk Wines.
2-11           SECTION 2.02.  VACANCY IN OFFICE.  The directors remaining
2-12     after a vacancy in the office of a temporary director shall fill
2-13     the vacancy by appointment by majority vote.
2-14                      ARTICLE 3.  CREATION OF DISTRICT
2-15           SECTION 3.01.  CREATION ELECTION.  The district may be
2-16     created and a tax may be authorized only if the creation and the
2-17     tax are approved by a majority of the qualified voters of the
2-18     territory of the proposed district voting at an election called and
2-19     held for that purpose.
2-20           SECTION 3.02.  ORDERING ELECTION.  (a)  A majority of the
2-21     temporary directors of the district may order a creation election
2-22     to be held as prescribed by Subsection (c) of this section.
2-23           (b)  On presentation of a petition for a creation election
2-24     signed by at least 50 of the registered voters of the territory of
2-25     the proposed district, according to the most recent official list
2-26     of registered voters, the temporary directors shall order an
2-27     election to be held as prescribed by Subsection (c) of this
 3-1     section.  The election shall be called not later than the 60th day
 3-2     after the date the petition is presented to the district.
 3-3           (c)  The election order must call for an election to be held
 3-4     in the territory within the West Independent School District
 3-5     boundaries in McLennan County.
 3-6           SECTION 3.03.  ELECTION ORDER.  The order calling the
 3-7     election must state:
 3-8                 (1)  the nature of the election, including the
 3-9     proposition that is to appear on the ballot;
3-10                 (2)  the date of the election;
3-11                 (3)  the hours during which the polls will be open; and
3-12                 (4)  the location of the polling places.
3-13           SECTION 3.04.  NOTICE.  The temporary directors shall give
3-14     notice of the election by publishing a substantial copy of the
3-15     election order in a newspaper of general circulation in the
3-16     proposed district once a week for two consecutive weeks.  The first
3-17     publication must appear at least 35 days before the date set for
3-18     the election.
3-19           SECTION 3.05.  ELECTION DATE.  The election shall be held not
3-20     less than 45 days or more than 60 days after the date on which the
3-21     election is ordered.
3-22           SECTION 3.06.  BALLOT PROPOSITION.  The ballot for the
3-23     election shall be printed to permit voting for or against the
3-24     proposition:  "The creation of a hospital district to be known as
3-25     the West Medical District and the levy of annual taxes for hospital
3-26     purposes at a rate not to exceed 75 cents on each $100 valuation of
3-27     all taxable property in the district."
 4-1           SECTION 3.07.  CANVASSING RETURNS.  (a)  The temporary
 4-2     directors shall meet and canvass the returns of the election.
 4-3           (b)  If a majority of the votes cast at the election favor
 4-4     creation of the district, the temporary directors shall declare the
 4-5     district created and shall enter the results in their minutes.
 4-6           (c)  If the creation of the district is defeated, the
 4-7     temporary directors may call and hold another creation election,
 4-8     but another creation election may not be called and held before the
 4-9     first anniversary of the date of the most recent creation election.
4-10           SECTION 3.08.  EXPIRATION OF ACT.  If the creation of the
4-11     district is not approved at an election held before the fifth
4-12     anniversary of the effective date of this Act, this Act expires.
4-13                     ARTICLE 4.  DISTRICT ADMINISTRATION
4-14           SECTION 4.01.  BOARD OF DIRECTORS.  (a)  The district is
4-15     governed by a board of seven directors.
4-16           (b)  From the time the creation of the district is approved
4-17     until the elected directors take office, the temporary directors
4-18     serve as directors of the district.
4-19           SECTION 4.02.  INITIAL DIRECTORS ELECTION.  (a)  Directors
4-20     shall be elected at an election to be held on the first Saturday in
4-21     May following the creation of the district.
4-22           (b)  At the initial election of directors following creation
4-23     of the district, members of the board of directors shall be elected
4-24     at large on a single ballot, with the seven candidates receiving
4-25     the highest number of votes being elected as directors.  The
4-26     directors elected at the initial election shall draw lots to
4-27     determine which two directors shall serve one-year terms, which two
 5-1     directors shall serve two-year terms, and which three directors
 5-2     shall serve three-year terms.
 5-3           SECTION 4.03.  METHOD OF ELECTION; STAGGERED TERMS; TERM OF
 5-4     OFFICE; ELECTION DATE.  (a)  After the initial election of
 5-5     directors following creation of the district, an election shall be
 5-6     held on the first Saturday in May each year to elect the
 5-7     appropriate number of successor directors.
 5-8           (b)  The directors shall be elected at large.
 5-9           (c)  Except as provided by Section 4.02(b) of this Act, each
5-10     director is elected for a three-year term.
5-11           SECTION 4.04.  NOTICE OF ELECTION.  Notice of each election
5-12     of directors shall be published in a newspaper of general
5-13     circulation in the district in accordance with Chapter 4, Election
5-14     Code.
5-15           SECTION 4.05.  APPLICATION.  A person who wishes to have the
5-16     person's name printed on the ballot as a candidate for director
5-17     must file an application with the secretary of the board of
5-18     directors in accordance with Chapter 144, Election Code.
5-19           SECTION 4.06.  QUALIFICATIONS FOR OFFICE.  (a)  To be
5-20     eligible to be a candidate for or to serve as a director, a person
5-21     must be:
5-22                 (1)  a resident of the district; and
5-23                 (2)  a qualified voter.
5-24           (b)  An employee of the district may not serve as a director.
5-25           SECTION 4.07.  BOND.  (a)  Before assuming the duties of the
5-26     office, each director must execute a bond for $5,000 payable to the
5-27     district, conditioned on the faithful performance of the person's
 6-1     duties as director.
 6-2           (b)  The bond shall be kept in the permanent records of the
 6-3     district.
 6-4           (c)  The board may pay for the director's bond with district
 6-5     funds.
 6-6           SECTION 4.08.  BOARD VACANCY.  A vacancy in the office of
 6-7     director shall be filled for the unexpired term by appointment by
 6-8     the remaining directors.
 6-9           SECTION 4.09.  OFFICERS; OFFICERS' TERMS; VACANCY.  (a)  The
6-10     board shall elect from among its members a president and a vice
6-11     president.
6-12           (b)  The board shall appoint a secretary, who need not be a
6-13     director.
6-14           (c)  Each officer of the board serves for a term of one year.
6-15           (d)  The board shall fill a vacancy in a board office for the
6-16     unexpired term.
6-17           SECTION 4.10.  COMPENSATION.  (a)  Directors and officers
6-18     serve without compensation but may be reimbursed for actual
6-19     expenses incurred in the performance of official duties.
6-20           (b)  Expenses reimbursed under this section must be:
6-21                 (1)  reported in the district's minute book or other
6-22     district records; and
6-23                 (2)  approved by the board.
6-24           SECTION 4.11.  QUORUM; VOTING REQUIREMENT.  (a)  A majority
6-25     of the membership of the board constitutes a quorum for the
6-26     transaction of business.
6-27           (b)  When a quorum is present, a majority of the members of
 7-1     the board voting must concur in a matter relating to the business
 7-2     of the district.
 7-3           SECTION 4.12.  ADMINISTRATOR AND ASSISTANT ADMINISTRATOR.
 7-4     (a)  The board may appoint a qualified person as administrator of
 7-5     the district and may in its discretion appoint an assistant to the
 7-6     administrator.
 7-7           (b)  The administrator and assistant administrator, if any,
 7-8     serve at the will of the board.
 7-9           (c)  The administrator and assistant administrator, if any,
7-10     are entitled to compensation as determined by the board.
7-11           (d)  The administrator shall supervise all the work and
7-12     activities of the district and shall have general direction of the
7-13     affairs of the district, subject to any limitations the board may
7-14     prescribe.
7-15           (e)  Before assuming the duties of administrator, the
7-16     administrator shall execute a bond payable to the hospital district
7-17     in an amount not less than $5,000 as determined by the board,
7-18     conditioned on the administrator's performing the administrator's
7-19     duties required under this Act.  The board may pay for the bond
7-20     with district funds.
7-21           (f)  The board may delegate to the administrator the
7-22     authority to employ or contract with persons for the district.
7-23           SECTION 4.13.  APPOINTMENTS TO STAFF.  The board may:
7-24                 (1)  appoint to the staff any doctors the board
7-25     considers necessary for the efficient operation of the district;
7-26     and
7-27                 (2)  make temporary appointments the board considers
 8-1     necessary.
 8-2           SECTION 4.14.  TECHNICIANS, NURSES, AND OTHER DISTRICT
 8-3     EMPLOYEES.  The district may employ or contract with technicians,
 8-4     nurses, fiscal agents, accountants, architects, attorneys, and
 8-5     other necessary employees.
 8-6                        ARTICLE 5.  POWERS AND DUTIES
 8-7           SECTION 5.01.  RESPONSIBILITY OF GOVERNMENTAL ENTITY.  (a)
 8-8     On creation of the district, the West Hospital Authority may, in
 8-9     the authority's sole discretion, convey or transfer to the
8-10     district:
8-11                 (1)  title to any land, buildings, improvements, or
8-12     equipment related to the hospital system that is owned by the West
8-13     Hospital Authority;
8-14                 (2)  operating funds and reserves for operating
8-15     expenses and funds that have been budgeted by the West Hospital
8-16     Authority to provide medical care for residents of the district for
8-17     the remainder of the fiscal year in which the district is
8-18     established; and
8-19                 (3)  accounts receivable of the West Hospital Authority
8-20     for medical care provided for residents of the district.
8-21           (b)  The West Hospital Authority shall convey or transfer to
8-22     the district funds established for payment of indebtedness assumed
8-23     by the district.
8-24           (c)  Except as provided by Subsection (b) of this section,
8-25     nothing in this Act requires the West Hospital Authority to convey
8-26     or transfer any funds or interest in property to the district.
8-27           (d)  On creation of the district, McLennan County may
 9-1     transfer to the district:
 9-2                 (1)  any taxes levied by McLennan County for hospital
 9-3     purposes for residents of the district for the year in which the
 9-4     district is created; or
 9-5                 (2)  any accounts receivable of McLennan County for
 9-6     medical care provided for residents of the district.
 9-7           SECTION 5.02.  LIMITATION ON GOVERNMENTAL ENTITY.   On or
 9-8     after creation of the district, another governmental entity,
 9-9     including a county or municipality, in which the district is
9-10     located may not levy taxes or issue bonds or other obligations for
9-11     hospital purposes or for providing medical care for the residents
9-12     of the district.
9-13           SECTION 5.03.  DISTRICT RESPONSIBILITIES.  (a)  On creation
9-14     of the district, the district:
9-15                 (1)  assumes full responsibility for operating hospital
9-16     facilities and for furnishing medical and hospital care for the
9-17     district's needy inhabitants;
9-18                 (2)  assumes any outstanding indebtedness incurred by a
9-19     county, municipality, or other governmental entity in which all or
9-20     part of the district is located in providing hospital care for
9-21     residents of the territory of the district before the district's
9-22     creation; and
9-23                 (3)  may operate or provide for the operation of a
9-24     mobile emergency medical service.
9-25           (b)  If part of a county, municipality, or other governmental
9-26     entity is included in the district and part is not included in the
9-27     district, the amount of indebtedness the district assumes under
 10-1    Subsection (a)(2) of this section is the portion of the total
 10-2    outstanding indebtedness of the county, municipality, or other
 10-3    entity for hospital care for all residents of the county,
 10-4    municipality, or other entity that the value of taxable property in
 10-5    the district bears to the total value of taxable property in the
 10-6    county, municipality, or other entity according to the last
 10-7    preceding approved assessment rolls of the county, municipality, or
 10-8    other entity before the district is confirmed.
 10-9          SECTION 5.04.  MANAGEMENT, CONTROL, AND ADMINISTRATION.  The
10-10    board shall manage, control, and administer the hospital system and
10-11    the funds and resources of the district.
10-12          SECTION 5.05.  DISTRICT RULES.  The board may adopt rules
10-13    governing the operations of the hospital and hospital system and
10-14    the duties, functions, and responsibilities of district staff and
10-15    employees.
10-16          SECTION 5.06.  METHODS AND PROCEDURES.  The board may
10-17    prescribe:
10-18                (1)  the method of making purchases and expenditures by
10-19    and for the district; and
10-20                (2)  accounting and control procedures for the
10-21    district.
10-22          SECTION 5.07.  HOSPITAL PROPERTY, FACILITIES, EQUIPMENT, AND
10-23    SERVICES.  (a)  The board shall determine the type, number, and
10-24    location of buildings required to establish and maintain an
10-25    adequate hospital system and the type of equipment necessary for
10-26    hospital care.
10-27          (b)  The board has complete discretion as to the type and
 11-1    extent of services the district will offer.  The district may
 11-2    provide any services or facilities the board finds necessary for
 11-3    hospital or medical care, including:
 11-4                (1)  emergency medical services;
 11-5                (2)  primary care clinics;
 11-6                (3)  outpatient clinics;
 11-7                (4)  home health agencies;
 11-8                (5)  pharmacies;
 11-9                (6)  nursing facilities;
11-10                (7)  assisted living facilities;
11-11                (8)  blood banks;
11-12                (9)  community mental health centers;
11-13                (10)  alcohol or chemical dependency centers;
11-14                (11)  minor emergency centers;
11-15                (12)  research centers; or
11-16                (13)  laboratories.
11-17          (c)  The board may:
11-18                (1)  acquire property, facilities, and equipment for
11-19    the district for use in the hospital system;
11-20                (2)  mortgage or pledge the property, facilities, or
11-21    equipment acquired as security for the payment of the purchase
11-22    price;
11-23                (3)  transfer by lease to physicians, individuals,
11-24    companies, corporations, or other legal entities or acquire by
11-25    lease district hospital facilities; and
11-26                (4)  sell or otherwise dispose of property, facilities,
11-27    or equipment.
 12-1          SECTION 5.08.  CONSTRUCTION CONTRACTS.  (a)  The board may
 12-2    enter into construction contracts on behalf of the district.
 12-3          (b)  A contract for construction in excess of the amount
 12-4    provided by Section 271.024, Local Government Code, may be made
 12-5    only after competitive bidding as provided by Subchapter B, Chapter
 12-6    271, Local Government Code.
 12-7          (c)  Chapter 2253, Government Code, as it relates to
 12-8    performance and payment bonds, applies to construction contracts
 12-9    let by the district.
12-10          SECTION 5.09.  DISTRICT OPERATING AND MANAGEMENT CONTRACTS.
12-11    The board may enter into operating or management contracts relating
12-12    to hospital facilities on behalf of the district.
12-13          SECTION 5.10.  INDIGENT CARE.  (a)  The district shall supply
12-14    care and treatment without charge to a patient who resides in the
12-15    district if the patient or relative who is legally responsible for
12-16    the patient's support cannot pay for the care and treatment.
12-17          (b)  The board shall determine the health care services to be
12-18    provided to residents eligible for assistance under this section to
12-19    fulfill the district's obligations under Section 9, Article IX,
12-20    Texas Constitution, and Section 61.055, Health and Safety Code.
12-21    The board may enter into a contract with another entity to fulfill
12-22    its obligations under this Act, Section 9, Article IX, Texas
12-23    Constitution, and Section 61.055, Health and Safety Code.
12-24          (c)  Not later than the first day of each operating year, the
12-25    district shall adopt an application procedure to determine
12-26    eligibility for assistance, as provided by Section 61.053, Health
12-27    and Safety Code.
 13-1          (d)  The administrator of the district may have an inquiry
 13-2    made into the financial circumstances of:
 13-3                (1)  a patient residing in the district and admitted to
 13-4    a district facility; and
 13-5                (2)  a relative of the patient who is legally
 13-6    responsible for the patient's support.
 13-7          (e)  On finding that the patient or a relative of the patient
 13-8    legally responsible for the patient's support can pay for all or
 13-9    any part of the care and treatment provided by the district, the
13-10    administrator shall report that finding to the board, and the board
13-11    shall issue an order directing the patient or the relative to pay
13-12    the district each week a specified amount that the individual is
13-13    able to pay.
13-14          (f)  The administrator may collect money owed to the district
13-15    from the estate of the patient or from that of a relative who was
13-16    legally responsible for the patient's support in the manner
13-17    provided by law for collection of expenses in the last illness of a
13-18    deceased person.
13-19          (g)  If there is a dispute relating to an individual's
13-20    ability to pay or if the administrator has any doubt concerning the
13-21    individual's ability to pay, the board shall call witnesses, hear
13-22    and resolve the question, and issue a final order.  An appeal from
13-23    a final order of the board must be made to a district court in the
13-24    county in which the district is located, and the substantial
13-25    evidence rule applies.
13-26          SECTION 5.11.  REIMBURSEMENT FOR SERVICES.  (a)  The board
13-27    shall require reimbursement from a county, municipality, or public
 14-1    hospital located outside the boundaries of the district for the
 14-2    district's care and treatment of a sick, diseased, or injured
 14-3    person of that county, municipality, or public hospital as provided
 14-4    by Chapter 61, Health and Safety Code.
 14-5          (b)  The board shall require reimbursement from the sheriff
 14-6    or police chief of a county or municipality for the district's care
 14-7    and treatment of a person confined in a jail facility of the county
 14-8    or municipality who is not a resident of the district.
 14-9          (c)  The board may contract with state or federal government
14-10    for the state or federal government to reimburse the district for
14-11    treatment of a sick, diseased, or injured person.
14-12          SECTION 5.12.  SERVICE CONTRACTS.  The board may contract
14-13    with a  municipality, county, special district, or other political
14-14    subdivision of the state or with a state or federal agency for the
14-15    district to:
14-16                (1)  furnish a mobile emergency medical service; or
14-17                (2)  provide for the investigatory or welfare needs of
14-18    inhabitants of the district.
14-19          SECTION 5.13.  GIFTS AND ENDOWMENTS.  On behalf of the
14-20    district, the board may accept gifts and endowments to be held in
14-21    trust for any purpose and under any direction, limitation, or
14-22    provision prescribed in writing by the donor that is consistent
14-23    with the proper management of the district.
14-24          SECTION 5.14.  AUTHORITY TO SUE AND BE SUED.  The board may
14-25    sue and be sued on behalf of the district.
14-26          SECTION 5.15.  RETIREMENT BENEFITS.   The board may provide
14-27    retirement benefits for the employees of the district by
 15-1    establishing or administering a retirement program or electing to
 15-2    participate in any statewide retirement system in which the
 15-3    district is eligible to participate.
 15-4          SECTION 5.16.  RECRUITMENT OF STAFF AND EMPLOYEES. The board
 15-5    may spend district funds, enter into agreements, and take other
 15-6    necessary action to recruit physicians, nurses, and other persons
 15-7    to serve as medical staff members or employees of the district,
 15-8    including:
 15-9                (1)  advertising and marketing;
15-10                (2)  paying travel, recruitment, and relocation
15-11    expenses;
15-12                (3)  providing a loan or scholarship to a physician or
15-13    a person currently enrolled in health care education courses at an
15-14    institution of higher education who contractually agrees to become
15-15    a district employee or medical staff member; or
15-16                (4)  contracting with one or more full-time medical
15-17    students or other students in a health occupation, each of whom
15-18    shall be enrolled in and in good standing at an accredited medical
15-19    school, college, or university, to pay the student's tuition or
15-20    other expenses in consideration of the student's agreement to serve
15-21    as an employee or independent contractor for the district.
15-22          SECTION 5.17.  NONPROFIT CORPORATION. The district may
15-23    sponsor and create a nonprofit corporation under the Texas
15-24    Non-Profit Corporation Act (Article 1396-1.01 et seq., Vernon's
15-25    Texas Civil Statutes), and may contribute funds to or solicit funds
15-26    for the corporation.  The corporation may use district funds only
15-27    to provide health care or other services the district is authorized
 16-1    to provide under this Act.  The board shall establish adequate
 16-2    controls to ensure that the corporation uses its funds as required
 16-3    by law.  The corporation may invest corporation funds in any manner
 16-4    in which the district may invest funds, including investing funds
 16-5    as authorized by Chapter 2256, Government Code.
 16-6                       ARTICLE 6.  DISTRICT FINANCES
 16-7          SECTION 6.01.  FISCAL YEAR.  (a)  The district operates on
 16-8    the fiscal year established by the board.
 16-9          (b)  The fiscal year may not be changed if revenue bonds of
16-10    the district are outstanding or more than once in a 24-month
16-11    period.
16-12          SECTION 6.02.  ANNUAL AUDIT.  The board annually shall have
16-13    an audit made of the financial condition of the district.
16-14          SECTION 6.03.  DISTRICT AUDIT AND RECORDS.  The annual audit
16-15    and other district records are open to inspection during regular
16-16    business hours at the principal office of the district.
16-17          SECTION 6.04.  ANNUAL BUDGET.  (a)  The administrator of the
16-18    district shall prepare a proposed annual budget for the district.
16-19          (b)  The proposed budget must contain a complete financial
16-20    statement, including a statement of:
16-21                (1)  the outstanding obligations of the district;
16-22                (2)  the amount of cash on hand to the credit of each
16-23    fund of the district;
16-24                (3)  the amount of money received by the district from
16-25    all sources during the previous year;
16-26                (4)  the amount of money available to the district from
16-27    all sources during the ensuing year;
 17-1                (5)  the amount of the balances expected at the end of
 17-2    the year in which the budget is being prepared;
 17-3                (6)  the estimated amount of revenues and balances
 17-4    available to cover the proposed budget; and
 17-5                (7)  the estimated tax rate that will be required.
 17-6          SECTION 6.05.  NOTICE; HEARING; ADOPTION OF BUDGET.  (a)  The
 17-7    board shall hold a public hearing on the proposed annual budget.
 17-8          (b)  The board shall publish notice of the hearing in a
 17-9    newspaper of general circulation in the district not later than the
17-10    10th day before the date of the hearing.
17-11          (c)  Any resident of the district is entitled to be present
17-12    and participate at the hearing.
17-13          (d)  At the conclusion of the hearing, the board shall adopt
17-14    a budget by acting on the budget proposed by the administrator.
17-15    The board may make any changes in the proposed budget that in its
17-16    judgment the interests of the taxpayers demand.
17-17          (e)  The budget is effective only after adoption by the
17-18    board.
17-19          SECTION 6.06.  AMENDING BUDGET.  After adoption, the annual
17-20    budget may be amended on the board's approval.
17-21          SECTION 6.07.  LIMITATION ON EXPENDITURES.  Money may not be
17-22    spent for an expense not included in the annual budget or an
17-23    amendment to it.
17-24          SECTION 6.08.  SWORN STATEMENT.  As soon as practicable after
17-25    the close of the fiscal year, the administrator shall prepare for
17-26    the board a sworn statement of the amount of money that belongs to
17-27    the district and an account of the disbursements of that money.
 18-1          SECTION 6.09.  BORROWING MONEY.  (a)  The district may borrow
 18-2    money at a rate not to exceed the minimum annual percentage rate
 18-3    allowed by law for district obligations at the time of the loan.
 18-4          (b)  To secure a loan, the board may pledge:
 18-5                (1)  the revenues of the district that are not pledged
 18-6    to pay the bonded indebtedness of the district;
 18-7                (2)  district taxes to be levied by the district during
 18-8    the 12-month period following the date of the pledge that are not
 18-9    pledged to pay the principal of or interest on district bonds; or
18-10                (3)  district bonds that have been authorized but not
18-11    sold.
18-12          (c)  A loan for which taxes or bonds are pledged shall mature
18-13    not later than the first anniversary of the date on which the loan
18-14    is made.  A loan for which district revenues are pledged shall
18-15    mature not later than the fifth anniversary of the date on which
18-16    the loan is made.
18-17          SECTION 6.10.  DEPOSITORY.  (a)  The board shall name at
18-18    least one bank to serve as depository for district funds.
18-19          (b)  District funds, other than those transmitted to a bank
18-20    for payment of bonds or obligations issued or assumed by the
18-21    district, shall be deposited as received with the depository bank
18-22    and must remain on deposit.  This subsection does not limit the
18-23    power of the board to place a portion of district funds on time
18-24    deposit or to purchase certificates of deposit.
18-25          (c)  Before the district deposits funds in a bank in an
18-26    amount that exceeds the maximum amount secured by the Federal
18-27    Deposit Insurance Corporation, the bank must execute a bond or
 19-1    other security in an amount sufficient to secure from loss the
 19-2    district funds that exceed the amount secured by the Federal
 19-3    Deposit Insurance Corporation.
 19-4                             ARTICLE 7.  BONDS
 19-5          SECTION 7.01.  GENERAL OBLIGATION BONDS.  The board may issue
 19-6    and sell bonds authorized by an election in the name and on the
 19-7    faith and credit of the hospital district to:
 19-8                (1)  purchase, construct, acquire, repair, or renovate
 19-9    buildings or improvements;
19-10                (2)  equip buildings or improvements for hospital
19-11    purposes; or
19-12                (3)  acquire and operate a mobile emergency medical
19-13    service.
19-14          SECTION 7.02.  TAXES TO PAY BONDS.  (a)  At the time the
19-15    bonds are issued by the district, the board shall levy a tax.
19-16          (b)  The tax must be sufficient to create an interest and
19-17    sinking fund to pay the principal of and interest on the bonds as
19-18    the bonds mature.
19-19          (c)  In any year, the tax together with any other tax the
19-20    district levies may not exceed the limit approved by the voters at
19-21    the election authorizing the levy of taxes.
19-22          SECTION 7.03.  BOND ELECTION.  (a)  The district may issue
19-23    general obligation bonds only if the bonds are authorized by a
19-24    majority of the qualified voters of the district voting at an
19-25    election called and held for that purpose under this section.
19-26          (b)  The board may order a bond election.  The order calling
19-27    the election must state:
 20-1                (1)  the nature and date of the election;
 20-2                (2)  the hours during which the polls will be open;
 20-3                (3)  the location of the polling places;
 20-4                (4)  the amounts of bonds to be authorized; and
 20-5                (5)  the maximum maturity of the bonds.
 20-6          (c)  Notice of a bond election shall be given as provided by
 20-7    Chapter 1251, Government Code.
 20-8          (d)  The board shall canvass the returns and declare the
 20-9    results of the election.
20-10          SECTION 7.04.  REVENUE BONDS.  (a)  The board may issue bonds
20-11    to:
20-12                (1)  purchase, construct, acquire, repair, equip, or
20-13    renovate buildings or improvements for hospital purposes;
20-14                (2)  acquire sites to be used for hospital purposes; or
20-15                (3)  acquire and operate a mobile emergency medical
20-16    service to assist the district in carrying out the district's
20-17    hospital purpose.
20-18          (b)  The bonds must be payable from and secured by a pledge
20-19    of all or part of the revenues derived from the operation of the
20-20    district's hospital system.  The bonds may be additionally secured
20-21    by a mortgage or deed of trust lien on all or part of district
20-22    property.
20-23          (c)  The bonds must be issued in the manner provided by
20-24    Sections 264.042, 264.043, 264.046, 264.047, 264.048, and 264.049,
20-25    Health and Safety Code, for issuance of revenue bonds by county
20-26    hospital authorities.
20-27          SECTION 7.05.  REFUNDING BONDS.  (a)  Refunding bonds of the
 21-1    district may be issued to refund and pay off any outstanding
 21-2    indebtedness the district has issued or assumed.
 21-3          (b)  The bonds must be issued in the manner provided by
 21-4    Chapter 1207, Government Code.
 21-5          SECTION 7.06.  INTEREST AND MATURITY. District bonds must
 21-6    mature not later than the 50th anniversary of the date of their
 21-7    issuance and must bear interest at a rate not to exceed that
 21-8    provided by Chapter 1204, Government Code.
 21-9          SECTION 7.07.  EXECUTION OF BONDS. The president of the board
21-10    shall execute the bonds in the name of the district, and the
21-11    secretary of the board shall countersign the bonds in the manner
21-12    provided by Chapter 618, Government Code.
21-13          SECTION 7.08.  APPROVAL AND REGISTRATION OF BONDS. (a)
21-14    District bonds are subject to the same requirements with regard to
21-15    approval by the attorney general and registration by the
21-16    comptroller as the law provides for approval and registration of
21-17    bonds issued by counties.
21-18          (b)  On approval by the attorney general and registration by
21-19    the comptroller, the bonds are incontestable for any cause.
21-20          SECTION 7.09.  BONDS AS INVESTMENTS. District bonds and
21-21    indebtedness assumed by the district are legal and authorized
21-22    investments for:
21-23                (1)  banks;
21-24                (2)  savings banks;
21-25                (3)  trust companies;
21-26                (4)  savings and loan associations;
21-27                (5)  insurance companies;
 22-1                (6)  fiduciaries;
 22-2                (7)  trustees;
 22-3                (8)  guardians; and
 22-4                (9)  sinking funds of municipalities, counties, school
 22-5    districts, and other political subdivisions of the state and other
 22-6    public funds of the state and its agencies, including the permanent
 22-7    school fund.
 22-8          SECTION 7.10.  BONDS AS SECURITY FOR DEPOSITS. District bonds
 22-9    are eligible to secure deposits of public funds of the state and of
22-10    municipalities, counties, school districts, and other political
22-11    subdivisions of the state.  The bonds are lawful and sufficient
22-12    security for deposits to the extent of their value if accompanied
22-13    by all unmatured coupons.
22-14          SECTION 7.11.  TAX STATUS OF BONDS. Because the district
22-15    created under this Act is a public entity performing an essential
22-16    public function, bonds issued by the district, any transaction
22-17    relating to the bonds, and profits made in the sale of the bonds
22-18    are free from taxation by the state or by any municipality, county,
22-19    special district, or other political subdivision of the state.
22-20                             ARTICLE 8.  TAXES
22-21          SECTION 8.01.  LEVY OF TAXES. (a)  The board annually may
22-22    impose property taxes in an amount not to exceed the limit approved
22-23    by the voters at the election authorizing the levy of taxes.
22-24          (b)  The tax rate for all purposes may not exceed 75 cents on
22-25    each $100 valuation of all taxable property in the district.
22-26          (c)  The taxes may be used to pay:
22-27                (1)  the indebtedness issued or assumed by the
 23-1    district; and
 23-2                (2)  the maintenance and operating expenses of the
 23-3    district.
 23-4          (d)  The district may not impose taxes to pay the principal
 23-5    of or interest on revenue bonds issued under this Act.
 23-6          SECTION 8.02.  BOARD AUTHORITY. The board may impose taxes
 23-7    for the entire year in which the district is created.
 23-8          SECTION 8.03.  ADOPTING TAX RATE. In adopting the tax rate,
 23-9    the board shall consider the income of the district from sources
23-10    other than taxation.
23-11          SECTION 8.04.  TAX ASSESSMENT AND COLLECTION. (a)  The Tax
23-12    Code governs the appraisal, assessment, and collection of district
23-13    taxes.
23-14          (b)  The board may provide for the appointment of a tax
23-15    assessor-collector for the district or may contract for the
23-16    assessment and collection of taxes as provided by the Tax Code.
23-17                    ARTICLE 9.  DISSOLUTION OF DISTRICT
23-18          SECTION 9.01.  DISSOLUTION ELECTION. The district may be
23-19    dissolved only if the dissolution is approved by a majority of the
23-20    qualified voters of the district voting in an election called and
23-21    held for that purpose.
23-22          SECTION 9.02.  ORDERING ELECTION. (a)  The board may order an
23-23    election on the question of dissolving the district and disposing
23-24    of the district's assets and obligations.
23-25          (b)  The board shall order an election on the question of
23-26    dissolving the district and disposing of the district's assets and
23-27    obligations if the board receives a petition requesting an election
 24-1    that is signed by a number of registered voters of the district
 24-2    equal to at least 15 percent of the registered voters in the
 24-3    district.
 24-4          SECTION 9.03.  ELECTION ORDER. The order calling the election
 24-5    must state:
 24-6                (1)  the nature of the election, including the
 24-7    proposition that is to appear on the ballot;
 24-8                (2)  the date of the election;
 24-9                (3)  the hours during which the polls will be open; and
24-10                (4)  the location of the polling places.
24-11          SECTION 9.04.  NOTICE. The board shall give notice of the
24-12    election by publishing a substantial copy of the election order in
24-13    a newspaper with general circulation in the district once a week
24-14    for two consecutive weeks.  The first publication must appear at
24-15    least 35 days before the date set for the election.
24-16          SECTION 9.05.  ELECTION DATE. (a)  The election shall be held
24-17    not later than the 60th day after the date the election is ordered.
24-18          (b)  Section 41.001, Election Code, does not apply to an
24-19    election ordered under this section.
24-20          SECTION 9.06.  BALLOT PROPOSITION. The ballot for an election
24-21    at which the dissolution of the district is proposed shall be
24-22    printed to permit voting for or against the proposition:  "The
24-23    dissolution of the West Medical District."
24-24          SECTION 9.07.  CANVASSING RETURNS. (a)  The board shall
24-25    canvass the returns of the election.
24-26          (b)  If a majority of the votes in the election favor
24-27    dissolution, the board shall find that the district is dissolved.
 25-1          (c)  If a majority of the votes in the election do not favor
 25-2    dissolution, the board shall continue to administer the district,
 25-3    and another election on the question of dissolution may not be held
 25-4    before the first anniversary of the date of the most recent
 25-5    election to dissolve the district.
 25-6          SECTION 9.08.  DISSOLUTION PROCEDURES.  (a)  If a majority of
 25-7    the votes in the election favor dissolution, the board shall:
 25-8                (1)  transfer the land, buildings, improvements,
 25-9    equipment, and other assets that belong to the district to a county
25-10    or another governmental entity in the county in which the district
25-11    is located;
25-12                (2)  sell the assets and liabilities to another person
25-13    or entity; or
25-14                (3)  administer the property, assets, and debts until
25-15    all funds  have been disposed of and all district debts have been
25-16    paid or settled.
25-17          (b)  If the district transfers the land, buildings,
25-18    improvements, equipment, and other assets to a county or other
25-19    governmental entity, the county or entity assumes all debts and
25-20    obligations of the district at the time of the transfer, at which
25-21    time the district is dissolved.  If the district does not transfer
25-22    the land, buildings, improvements, equipment, and other assets to a
25-23    county or other governmental entity, or sell those assets and the
25-24    liabilities to another person, the board shall administer the
25-25    property, assets, and debts of the district until all funds have
25-26    been disposed of and all district debts have been paid or settled,
25-27    at which time the district is dissolved.
 26-1          (c)  After the board finds that the district is dissolved,
 26-2    the board shall:
 26-3                (1)  determine the debt owed by the district; and
 26-4                (2)  impose on the property included in the district's
 26-5    tax rolls a tax that is in proportion of the debt to the property
 26-6    value.
 26-7          (d)  When all outstanding debts and obligations of the
 26-8    district are paid, the board shall order the secretary to return
 26-9    the pro rata share of all unused tax money to each district
26-10    taxpayer.
26-11          (e)  A taxpayer may request that the taxpayer's share of
26-12    surplus tax money be credited to the taxpayer's county taxes.  If a
26-13    taxpayer requests the credit, the board shall direct the secretary
26-14    to transmit the funds to the county tax assessor-collector.
26-15          (f)  After the district has paid all of the district's debts
26-16    and has disposed of all of the district's assets and funds as
26-17    prescribed by this section, the board shall file a written report
26-18    with the Commissioners Court of McLennan County setting forth a
26-19    summary of the board's actions in dissolving the district.
26-20          (g)  Not later than the 10th day after the date it receives
26-21    the report and determines that the requirements of this section
26-22    have been fulfilled, the Commissioners Court of McLennan County
26-23    shall enter an order dissolving the district and releasing the
26-24    board from any further duty or obligation.
26-25          SECTION 9.09.  SALE OR TRANSFER OF ASSETS. (a)  The district
26-26    may provide for the sale or transfer of the district's assets and
26-27    liabilities to another entity or person and the district's
 27-1    subsequent dissolution.  The dissolution of the district and the
 27-2    sale or transfer of the district's assets and liabilities to
 27-3    another person or entity may not contravene a trust indenture or
 27-4    bond resolution relating to the outstanding bonds of the district.
 27-5    The dissolution and sale or transfer does not diminish or impair
 27-6    the rights of a holder of an outstanding bond, warrant, or other
 27-7    obligation of the district.
 27-8          (b)  The sale or transfer of the district's assets and
 27-9    liabilities must satisfy the debt and bond obligations of the
27-10    district in a manner that protects the interests of the residents
27-11    of the district, including the residents' collective property
27-12    rights in the district's assets.  Any grant from federal funds is
27-13    considered an obligation to be repaid in satisfaction.  The
27-14    district may not transfer or dispose of the district's assets
27-15    except for due compensation unless the transfer is made to another
27-16    governmental agency that serves the district and the transferred
27-17    assets are to be used for the benefit of residents of the district.
27-18                        ARTICLE 10.  MISCELLANEOUS
27-19          SECTION 10.01.  LIMITATION ON STATE ASSISTANCE. The state may
27-20    not become obligated for the support or maintenance of a hospital
27-21    district created under this Act, nor may the legislature make a
27-22    direct appropriation for the construction, maintenance, or
27-23    improvement of a facility of the district.
27-24          SECTION 10.02.  REQUIRED PUBLICATION. Proof of publication of
27-25    the notice required in the enactment of this Act under the
27-26    provisions of Section 9, Article IX, Texas Constitution, has been
27-27    made in the manner and form provided by law pertaining to the
 28-1    enactment of local and special laws, and the notice is found and
 28-2    declared proper and sufficient to satisfy the requirement.
 28-3          SECTION 10.03.  EFFECTIVE DATE. This Act takes effect
 28-4    immediately if it receives a vote of two-thirds of all the members
 28-5    elected to each house, as provided by Section 39, Article III,
 28-6    Texas Constitution.  If this Act does not receive the vote
 28-7    necessary for immediate effect, this Act takes effect September 1,
 28-8    2001.