By Duncan                                                S.B. No. 9
         77R9685 JMG-F                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the powers, duties, and board of managers of the Reagan
 1-3     Hospital District of Reagan County, Texas.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1. Section 5, Chapter 29, Acts of the 65th
 1-6     Legislature, Regular Session, 1977, is amended to read as follows:
 1-7           Sec. 5. (a)  The board of directors consists of six members
 1-8     with one director elected from each commissioners precinct of
 1-9     Reagan County and two directors elected from the district at large.
1-10     A director elected from a commissioners precinct is not required to
1-11     be a resident of that commissioners precinct.  The directors serve
1-12     three-year staggered terms.  [On the effective date of this Act,
1-13     the following persons shall constitute the temporary directors of
1-14     the district:]
1-15                 [1.  Frank Sandel;]
1-16                 [2.  E. G. Cauble, Jr.;]
1-17                 [3.  Wade Jones;]
1-18                 [4.  Buck Schaible;]
1-19                 [5.  Mike Elkins; and]
1-20                 [6.  Jack Black.]
1-21           [(b)  Each of the directors shall execute the constitutional
1-22     oath of office within 60 days of the effective date of this Act.
1-23     Should any of the named directors refuse to act or for any reason
1-24     fail to qualify as required, the remaining temporary directors
 2-1     shall by majority vote appoint a successor or successors to fill
 2-2     the vacancy.  The terms of the first, third, and fifth named
 2-3     directors shall expire on the first Saturday in April of the year
 2-4     following the election creating the district, and the terms of the
 2-5     second, fourth, and sixth named directors shall expire on the first
 2-6     Saturday in April of the second year following the election
 2-7     creating the district.  Successors shall be elected by a vote of
 2-8     the electors of the entire district for two-year terms.]
 2-9           [(c)  When the creation of the district is approved and the
2-10     returns of the election are officially canvassed, the persons
2-11     acting as temporary directors become permanent directors whose
2-12     terms expire as provided in Subsection (b) of this section.]  Each
2-13     permanent director and the director's [his] successor in office
2-14     shall qualify by executing the constitutional oath of office.
2-15           (b)  A redistricting or other change in the boundaries of the
2-16     commissioners precincts of Reagan County does not affect the
2-17     service or term of a member of the district's board of directors in
2-18     office when the change occurs.  The change in the commissioners
2-19     precincts applies to each election of directors occurring after the
2-20     change takes effect as the terms of directors then in office
2-21     expire.
2-22           (c) [(d)]  No person may be appointed or elected as a member
2-23     of the board of directors of the hospital district unless the
2-24     person [he] is a resident of the district and a qualified voter
2-25     [thereof and owns property subject to taxation therein and unless
2-26     at the time of such election or appointment he shall be more than
2-27     18 years of age].
 3-1           (d) [(e)]  The board of directors shall organize by electing
 3-2     one of their number as president, one of their number as
 3-3     vice-president, and a secretary, who need not be a director.
 3-4     Officers are elected for a term of one year and vacancies shall be
 3-5     filled for the unexpired term by vote of the board.  Any four
 3-6     members of the board of directors constitute a quorum and a
 3-7     concurrence of four is sufficient in all matters pertaining to the
 3-8     business of the district.  All vacancies in the office of director
 3-9     shall be filled for the unexpired term by appointment by the
3-10     remainder of the board of directors and each appointee holds office
3-11     for the unexpired term for which the person was appointed.  If the
3-12     number of directors is reduced to less than five, the remaining
3-13     directors shall immediately call a special election to fill the
3-14     vacancies, and upon their failure to do so, the district court, on
3-15     application of any resident [elector or taxpayer] of the district,
3-16     shall order the election.
3-17           (e) [(f)]  A regular election of directors shall be held on
3-18     the first [third] Saturday in May of each year, and shall be
3-19     ordered by the board in accordance with the applicable provisions
3-20     of Chapter 3, Election Code.  Notice [notice] of the election shall
3-21     be published in a newspaper of general circulation in the district
3-22     [county] one time in accordance with Chapter 4, Election Code [at
3-23     least 10 days prior to the date of election].  Any person desiring
3-24     the person's [his] name to be printed on the ballot as a candidate
3-25     for director shall file an application with the secretary of the
3-26     board in accordance with Chapter 144, Election Code, asking that
3-27     the person's [his] name be printed on the ballot.  The application
 4-1     must specify the commissioners precinct for which the person is
 4-2     applying to be a candidate or state that the person is applying to
 4-3     be a candidate for election to an at-large position [The
 4-4     application must be filed not later than 5 p.m. of the 45th day
 4-5     before the date on which the election is held].
 4-6           SECTION 2.  Section 6, Chapter 29, Acts of the 65th
 4-7     Legislature, Regular Session, 1977, is amended to read as follows:
 4-8           Sec. 6. (a)  The board of directors shall manage, control,
 4-9     and administer the hospital system and all funds and resources of
4-10     the district, but operating, depreciation, or building fund
4-11     reserves may not be invested in any funds or securities other than
4-12     those specified in Chapter 2256, Government Code [Articles 836 and
4-13     837, Revised Civil Statutes of Texas, 1925, as amended].
4-14           (b)  The board is given full authority to establish rules and
4-15     regulations relating to seniority of employees of the district, and
4-16     may establish or administer a retirement program or elect to
4-17     participate in any statewide retirement program in which the
4-18     district is eligible to participate.
4-19           (c)  The district may give effect to previous years of
4-20     service for those employees who have been continuously employed in
4-21     the operation or management of the hospital facilities acquired
4-22     from the county or any city or town on the creation of the
4-23     district.  The district, through its board of directors, shall have
4-24     the power and authority to sue and be sued and to promulgate rules
4-25     governing the operation of the hospital, hospital system, its
4-26     staff, and employees.
4-27           (d)  The board of directors may appoint a qualified person to
 5-1     be known as the administrator of the hospital district and may in
 5-2     its discretion appoint assistants to the administrator.  The
 5-3     administrator and assistant administrator, if any, serve at the
 5-4     will of the board and receive compensation fixed by the board.  The
 5-5     administrator shall, on assuming the [his] duties of administrator,
 5-6     execute a bond payable to the hospital district in an amount set by
 5-7     the board of directors, not less than $5,000, conditioned on
 5-8     performance of the duties required of the administrator [him], and
 5-9     containing other conditions as the board may require.  The board
5-10     may pay for the bond with district funds.  The administrator shall
5-11     supervise all the work and activities of the district and shall
5-12     have general direction of the affairs of the district, subject to
5-13     the limitations prescribed by the board.
5-14           (e)  The board of directors shall have the authority to
5-15     appoint, dismiss from the staff, or contract with doctors as it
5-16     deems necessary for the efficient operation of the district, and
5-17     may provide for temporary appointments to the staff if warranted by
5-18     circumstances.
5-19           (f)  The board may delegate to the administrator the
5-20     authority to employ technicians, nurses, and employees of the
5-21     district.
5-22           (g)  The board shall be authorized to contract with any other
5-23     political subdivision or governmental agency whereby the district
5-24     will provide investigatory or other services as to the medical,
5-25     hospital, or welfare needs of the inhabitants of the district and
5-26     shall be authorized to contract with any county or incorporated
5-27     municipality located outside its boundaries for the hospitalization
 6-1     and treatment of the sick, diseased, or injured persons of any such
 6-2     county or municipality, and shall have the authority to contract
 6-3     with the state or agencies of the federal government for the
 6-4     hospital treatment of sick, diseased, or injured persons.
 6-5           (h)  The board of directors may purchase or lease property,
 6-6     facilities, and equipment for the district to use in the hospital
 6-7     system and may mortgage or pledge the property, facilities, or
 6-8     equipment as security for the payment of the purchase price.
 6-9           (i)  The board of directors may spend district funds, enter
6-10     into agreements, and take other necessary action to recruit
6-11     physicians and other persons to serve as medical staff members or
6-12     employees of the district, including:
6-13                 (1)  advertising and marketing;
6-14                 (2)  paying travel, recruitment, and relocation
6-15     expenses;
6-16                 (3)  providing a loan or scholarship to a physician or
6-17     a person currently enrolled in health care education courses at an
6-18     institution of higher education who contractually agrees to become
6-19     a district employee or medical staff member; or
6-20                 (4)  contracting with one or more full-time medical
6-21     students or other students in a health occupation, each of whom
6-22     must be enrolled in and in good standing at an accredited medical
6-23     school, college, or university, to pay the student's tuition or
6-24     other expenses in consideration of the student's agreement to serve
6-25     as an employee or independent contractor for the district.
6-26           (j)  The board may institute a suit to enforce the payment of
6-27     taxes and to foreclose liens to secure the payment of taxes due to
 7-1     the district.
 7-2           (k)  The board may provide or contract for the provision of
 7-3     educational programs or courses for employees and medical staff of
 7-4     the district.
 7-5           (l)  The board may institute a suit to collect amounts owed
 7-6     to the district by patients who have not been determined to be
 7-7     unable to pay under Section 18.
 7-8           (m)  The district may sponsor and create a nonprofit
 7-9     corporation under the Texas Non-Profit Corporation Act (Article
7-10     1396-1.01 et seq., Vernon's Texas Civil Statutes) and may
7-11     contribute funds to or solicit funds for the corporation.  The
7-12     corporation may use its funds only to provide health care or other
7-13     services the district is authorized to provide under this Act.  The
7-14     board of directors of the hospital district shall establish
7-15     adequate controls to ensure that the corporation uses its funds as
7-16     required by this subsection.  The corporation may invest
7-17     corporation funds in any manner in which the district may invest
7-18     funds, including investing funds as authorized by Chapter 2256,
7-19     Government Code.
7-20           SECTION 3.  Section 7, Chapter 29, Acts of the 65th
7-21     Legislature, Regular Session, 1977, is amended to read as follows:
7-22           Sec. 7. (a)  The district shall be operated on the basis of a
7-23     fiscal year established by the board.  The fiscal year may not be
7-24     changed when revenue bonds are outstanding or more than one time in
7-25     a 24-month period.
7-26           (b)  The board [commencing on October 1 of each year and
7-27     ending on September 30 of the following year, and every fiscal
 8-1     year, it] shall cause an independent audit to be made annually of
 8-2     the books and records [financial condition] of the district.  The
 8-3     audit [, which], together with other records of the district, shall
 8-4     be open to inspection at the principal office of the district.
 8-5           (c)  The administrator shall prepare an annual budget for
 8-6     approval by the board of directors.  The budget shall [also]
 8-7     contain a complete financial statement of the district showing all
 8-8     outstanding obligations of the district, the cash on hand to the
 8-9     credit of each fund of the district, the funds received from all
8-10     sources during the previous year, the funds available from all
8-11     sources during the ensuing year, with balances expected at year end
8-12     of the year in which the budget is being prepared, estimated
8-13     revenues and balances available to cover the proposed budget, the
8-14     estimated tax rate which will be required, and the proposed
8-15     expenditures, disbursements, and estimated receipts and collections
8-16     for the following fiscal year.  A public hearing on the annual
8-17     budget shall be held by the board of directors after notice of the
8-18     hearing has been published one time at least 10 days before the
8-19     date set for the hearing in a newspaper of [or newspapers which
8-20     individually or collectively provide] general circulation in the
8-21     hospital district.  Any resident [property taxpayer] of the
8-22     district shall have the right to be present and participate in the
8-23     hearing.  At the conclusion of the hearing, the budget, as proposed
8-24     by the administrator, shall be acted on by the board of directors.
8-25     The board of directors shall have authority to make such changes in
8-26     the budget as in their judgment the law warrants and the interest
8-27     of the taxpayers demand.  No expenditure may be made for any
 9-1     expense not included in the annual budget or an amendment to it.
 9-2     The annual budget may be amended from time to time as the
 9-3     circumstances may require, but the annual budget, and all
 9-4     amendments, shall be approved by the board of directors.
 9-5           (d)  As soon as practicable after the close of each fiscal
 9-6     year, the administrator shall prepare for the board a full sworn
 9-7     statement of all moneys belonging to the district and a full
 9-8     account of disbursements.
 9-9           SECTION 4.  Section 8, Chapter 29, Acts of the 65th
9-10     Legislature, Regular Session, 1977, is amended to read as follows:
9-11           Sec. 8. (a)  The board of directors shall have the power to
9-12     issue and sell general obligation [its] bonds authorized by an
9-13     election in the name and on the faith and credit of the hospital
9-14     district for the purchase, construction, acquisition, repair, or
9-15     renovation of buildings and improvements, [and] equipping the
9-16     buildings and improvements, and acquisition of sites to be used for
9-17     district [them for hospital] purposes.  At the time of the issuance
9-18     of any general obligation bonds by the district, a tax shall be
9-19     levied by the board sufficient to create an interest and sinking
9-20     fund to pay the interest on and principal of the bonds as they
9-21     mature, providing the tax, together with any other taxes levied for
9-22     the district, shall not exceed 75  on each $100 valuation in any
9-23     year [the rate of tax approved under Section 4 of this Act].  No
9-24     general obligation bonds shall be issued by the hospital district
9-25     [except refunding bonds] until authorized by a majority of the
9-26     qualified voters [electors] of the district voting at an election
9-27     called for that purpose.  The election shall be conducted in
 10-1    accordance with Chapter 1251, Government Code.  [The order for bond
 10-2    election shall specify the date of the election, the amount of
 10-3    bonds to be authorized, the maximum maturity date and rate of
 10-4    interest they are to bear, the place or places where the election
 10-5    shall be held, the presiding judge and alternate judge for each
 10-6    voting place, and shall provide for clerks as in county elections.
 10-7    Except for a bond election held under Subsection (b) of this
 10-8    section, in which case notice shall be given as provided in Section
 10-9    4, notice of any bond election shall be given as provided in
10-10    Article 704, Revised Civil Statutes of Texas, 1925, as amended, and
10-11    shall be conducted in accordance with the Texas Election Code, as
10-12    amended, except as modified by the provisions of this Act.]
10-13          (b)  A separate proposition on the request of the temporary
10-14    directors may be submitted at the election for the confirmation of
10-15    the district as to whether the board of directors, in the event the
10-16    district is created, shall be authorized to issue bonds for the
10-17    purposes specified in this section.  The proposition, if submitted,
10-18    shall specify the purpose for which the bonds are to be issued, the
10-19    maximum amount of bonds then proposed to be issued, the maximum
10-20    maturity date, and the maximum interest rate.
10-21          (c)  The board may issue refunding bonds of the district for
10-22    the purpose of refunding and paying off any outstanding
10-23    indebtedness issued or assumed.  The board shall issue refunding
10-24    bonds in accordance with Chapter 1207, Government Code.  [The
10-25    refunding bonds may be sold and the proceeds applied to the payment
10-26    of outstanding indebtedness, or may be exchanged in whole or in
10-27    part for not less than a like principal amount of outstanding
 11-1    indebtedness, provided that, if refunding bonds are to be exchanged
 11-2    for a like amount of the outstanding indebtedness, the refunding
 11-3    bonds shall bear interest at the same or lower rate than borne by
 11-4    the debt refunded, unless it is shown mathematically that a saving
 11-5    will result in the total amount of interest to be paid on the
 11-6    refunding bonds.  If refunding bonds are to be sold and the
 11-7    proceeds thereof applied to the payment of any such outstanding
 11-8    indebtedness, they shall be issued and payments made in the manner
 11-9    specified by Chapter 503, Acts of the 54th Legislature, 1955, as
11-10    amended (Article 717k, Vernon's Texas Civil Statutes).]
11-11          (d)  Bonds of the district shall bear interest at a rate not
11-12    to exceed the rate provided by Chapter 1204, Government Code, shall
11-13    mature within 40 years of their date, shall be executed in the name
11-14    of the hospital district and in its behalf by the president of the
11-15    board and countersigned by the secretary in the manner provided by
11-16    Chapter 618, Government Code, as added by Chapter 227, Acts of the
11-17    76th Legislature, Regular Session, 1999 [Chapter 204, Acts of the
11-18    57th Legislature, Regular Session, 1961 (Article 717j-1, Vernon's
11-19    Texas Civil Statutes)], and shall be subject to the same
11-20    requirements in the matter of approval by the attorney general and
11-21    registration by the comptroller of public accounts as are by law
11-22    provided for approval and registration of bonds issued by counties.
11-23    On the approval of the bonds by the attorney general and
11-24    registration by the comptroller, they are incontestable for any
11-25    cause.
11-26          SECTION 5.  Section 9, Chapter 29, Acts of the 65th
11-27    Legislature, Regular Session, 1977, is amended to read as follows:
 12-1          Sec. 9. The board of directors is authorized to issue revenue
 12-2    bonds and refund any previously issued revenue bonds for
 12-3    purchasing, constructing, acquiring, repairing, equipping, or
 12-4    renovating buildings and improvements for district [hospital]
 12-5    purposes, and for acquiring sites for them, the bonds to be payable
 12-6    from and secured by a pledge of all or any part of the revenues of
 12-7    the district to be derived from the operation of its hospital
 12-8    system [or hospitals].  The bonds may be additionally secured by a
 12-9    mortgage or deed of trust lien on any part or all of its
12-10    properties.  The bonds shall be issued in the manner and in
12-11    accordance with the procedures and requirements specified for the
12-12    issuance of revenue bonds by county hospital authorities in
12-13    Sections 264.042, 264.043, 264.044, 264.046, 264.047, 264.048, and
12-14    264.049, Health and Safety Code [8, 10, 11, 12, and 13 of Chapter
12-15    122, Acts of the 58th Legislature, 1963, as amended (Article 4494r,
12-16    Vernon's Texas Civil Statutes)].
12-17          SECTION 6.  Section 11, Chapter 29, Acts of the 65th
12-18    Legislature, Regular Session, 1977, is amended to read as follows:
12-19          Sec. 11. The board of directors has the power to prescribe
12-20    the method and manner of making purchases and expenditures by and
12-21    for the hospital district, and shall also be authorized to
12-22    prescribe all accounting and control procedures.  All contracts for
12-23    construction in excess of the amount provided by Section 271.024,
12-24    Local Government Code, [or purchases involving the expenditure of
12-25    more than $5,000] may be made only after competitive bidding
12-26    [advertising] in the manner provided by Subchapter B, Chapter 271,
12-27    Local Government Code.  The provisions of Chapter 2253, Government
 13-1    Code, relating to performance and payment bonds, applies [Chapter
 13-2    163, General Laws, Acts of the 42nd Legislature, Regular Session,
 13-3    1931 (Article 2368a, Vernon's Texas Civil Statutes).  The
 13-4    provisions of Article 5160, Revised Statutes, apply] to
 13-5    construction contracts let by the district.  The district may
 13-6    acquire equipment for use in its hospital system and mortgage or
 13-7    pledge the property so acquired as security for the payment of the
 13-8    purchase price, but any such contract shall provide for the entire
 13-9    obligation of the district to be retired within five years from the
13-10    date of the contract.  Except as otherwise provided by this Act
13-11    [permitted in the preceding sentence and as permitted by Sections 8
13-12    and 9], the district may incur no obligation payable from any
13-13    revenues of the district, taxes or otherwise, except those on hand
13-14    or to be on hand within the current and following fiscal year of
13-15    the district.
13-16          SECTION 7.  Section 12(a), Chapter 29, Acts of the 65th
13-17    Legislature, Regular Session, 1977, is amended to read as follows:
13-18          (a)  The board of directors of the district shall name one or
13-19    more banks [within its boundaries] to serve as depository for the
13-20    funds of the district.  All funds of the district, except those
13-21    invested as provided in Section 6 of this Act, and those
13-22    transmitted to a bank or banks as payment for bonds or obligations
13-23    issued by the district, shall be deposited as received with the
13-24    depository bank and shall remain on deposit, provided that nothing
13-25    in this Act shall limit the power of the board to place a portion
13-26    of such funds on time deposit or purchase certificates of deposit.
13-27          SECTION 8.  Section 15(a), Chapter 29, Acts of the 65th
 14-1    Legislature, Regular Session, 1977, is amended to read as follows:
 14-2          (a)  The district has the right and power of eminent domain
 14-3    for the purpose of acquiring by condemnation property of any kind
 14-4    and character in fee simple, or any lesser interest, within the
 14-5    boundaries of the district necessary or convenient to the powers,
 14-6    rights, and privileges conferred by this Act, in the manner
 14-7    provided by the general law with respect to condemnation by
 14-8    counties, provided that the district shall not be required to make
 14-9    bond or deposits in the registry of the trial court as required by
14-10    Section 21.021, Property Code [Paragraph 2 of Article 3268, Revised
14-11    Civil Statutes of Texas, 1925, as amended].  In condemnation
14-12    proceedings being prosecuted by the district, the district shall
14-13    not be required to pay in advance or give bond or other security
14-14    for costs in the trial court, nor to give any bond otherwise
14-15    required for the issuance of a temporary restraining order or a
14-16    temporary injunction nor to give bond for costs or for supersedeas
14-17    on any appeal or writ of error.
14-18          SECTION 9.  Section 16, Chapter 29, Acts of the 65th
14-19    Legislature, Regular Session, 1977, is amended to read as follows:
14-20          Sec. 16. [(a)]  The directors shall have the authority to
14-21    levy taxes for the entire year in which the district is
14-22    established.  The Tax Code governs the appraisal of property for
14-23    and assessment and collection of district taxes.  The board may
14-24    provide for the appointment of a tax assessor-collector for the
14-25    district or may contract for the assessment and collection of taxes
14-26    as provided by the Tax Code [All taxes of the district shall be
14-27    assessed and collected on county tax values as provided in
 15-1    Subsection (b) of this section unless the directors, by majority
 15-2    vote, elect to have taxes assessed and collected by the district's
 15-3    own tax assessor-collector under Subsection (c) of this section.
 15-4    Any such election may be made prior to December 1 annually and
 15-5    shall govern the manner in which taxes are assessed and collected
 15-6    until changed by a similar resolution.]
 15-7          [(b)  Under this subsection, district taxes shall be assessed
 15-8    and collected on county tax values in the same manner as provided
 15-9    by law with relation to county taxes.  The tax assessor-collector
15-10    of the county in which the district is situated is required to
15-11    accomplish the assessment and collection of all taxes levied by and
15-12    on behalf of the district.  The assessor-collector of taxes shall
15-13    charge and deduct from payments to the hospital district an amount
15-14    as fees for assessing and collecting the taxes, at a rate of up to
15-15    two percent of the amounts collected, as determined by the board of
15-16    directors, but the amount paid may not exceed $5,000 in any one
15-17    calendar year. The fees shall be deposited in the officers salary
15-18    fund of the county and reported as fees of office of the county tax
15-19    assessor-collector.  Interest and penalties on taxes paid to the
15-20    hospital district shall be the same as in the case of county taxes.
15-21    Discounts shall be the same as allowed by the county.  The residue
15-22    of tax collections after deduction of discounts and fees for
15-23    assessing and collecting shall be deposited in the district's
15-24    depository.  The bond of the county tax assessor-collector shall
15-25    stand as security for the proper performance of his duties as
15-26    assessor-collector of the district, or, if in the judgment of the
15-27    board of directors it is necessary, additional bond payable to the
 16-1    district may be required.  In all matters pertaining to the
 16-2    assessment, collection, and enforcement of taxes for the district,
 16-3    the county tax assessor-collector is authorized to act in all
 16-4    respects according to the laws of the state relating to state and
 16-5    county taxes.]
 16-6          [(c)  Under this subsection, taxes shall be assessed and
 16-7    collected by a tax assessor-collector appointed by the directors,
 16-8    who shall also fix the terms of his employment, compensation, and
 16-9    requirement for bond to assure the faithful performance of his
16-10    duties, but in no event may the bond be for less than $5,000].
16-11          SECTION 10.  Section 18, Chapter 29, Acts of the 65th
16-12    Legislature, Regular Session, 1977, is amended to read as follows:
16-13          Sec. 18.  When a patient residing within the district has
16-14    been admitted to the district's hospital facilities, the
16-15    administrator may cause inquiry to be made as to the patient's
16-16    [his] financial circumstances and those of the relatives of the
16-17    patient legally liable for the patient's [his] support.  If the
16-18    administrator [he] finds that the patient or the patient's [his]
16-19    relatives are able to pay for the patient's [his] care and
16-20    treatment in whole or in part, as determined by the district's
16-21    current indigent health care policy, an order shall be made
16-22    directing the patient or the patient's [his] relatives to pay to
16-23    the hospital district for the care and support of the patient a
16-24    specified sum each week in proportion to their financial ability.
16-25    The administrator shall have power and authority to collect the
16-26    sums from the estate of the patient or the patient's [his]
16-27    relatives legally liable for the patient's [his] support in the
 17-1    manner provided by law for collection of expenses in the last
 17-2    illness of a deceased person.  If the administrator finds that the
 17-3    patient or the patient's [his] relatives are not able to pay either
 17-4    in whole or in part for the patient's [his] care and treatment in
 17-5    the hospital, it shall become a charge on the hospital district as
 17-6    to the amount of the inability to pay.  Should there be any dispute
 17-7    as to the ability to pay or doubt in the mind of the administrator
 17-8    [or manager], the board of directors shall hear and determine the
 17-9    issue after calling witnesses.  [Appeals from the final order of
17-10    the board lie to the district court.  The substantial evidence rule
17-11    applies.]
17-12          SECTION 11.  Chapter 29, Acts of the 65th Legislature,
17-13    Regular Session, 1977, is amended by adding Section 18A to read as
17-14    follows:
17-15          Sec. 18A. (a)  The district may be dissolved only if the
17-16    dissolution is approved by a majority of the qualified voters of
17-17    the district voting in an election called and held for that
17-18    purpose.
17-19          (b)  The board may order an election on the question of
17-20    dissolving the district and disposing of the district's assets and
17-21    obligations.  The board shall order an election if the board
17-22    receives a petition requesting an election that is signed by at
17-23    least 15 percent of the registered voters in the district.
17-24          (c)  The election shall be held not later than the 60th day
17-25    after the date the election is ordered.  Section 41.001(a),
17-26    Election Code, does not apply to an election ordered under this
17-27    section. The order calling the election shall state:
 18-1                (1)  the nature of the election, including the
 18-2    proposition that is to appear on the ballot;
 18-3                (2)  the date of the election;
 18-4                (3)  the hours during which the polls will be open; and
 18-5                (4)  the location of the polling places.
 18-6          (d)  The board shall give notice of the election by
 18-7    publishing a substantial copy of the election order in a newspaper
 18-8    with general circulation in the district once a week for two
 18-9    consecutive weeks.  The first publication must appear not less than
18-10    35 days before the date set for the election.  The ballot for the
18-11    election shall be printed to permit voting for or against the
18-12    proposition: "The dissolution of the Reagan Hospital District of
18-13    Reagan County, Texas."
18-14          (e)  If a majority of the votes in the election favor
18-15    dissolution, the board shall find that the district is dissolved.
18-16    If a majority of the votes in the election do not favor
18-17    dissolution, the board shall continue to administer the district,
18-18    and another election on the question of dissolution may not be held
18-19    before the first anniversary of the most recent election to
18-20    dissolve the district.
18-21          (f)  If a majority of the votes in the election favor
18-22    dissolution, the board shall:
18-23                (1)  transfer the land, buildings, improvements,
18-24    equipment, and other assets that belong to the district to Reagan
18-25    County or to another governmental entity in Reagan County;
18-26                (2)  sell the assets and liabilities to another person;
18-27    or
 19-1                (3)  administer the property, assets, and debts until
 19-2    all funds have been disposed of and all district debts have been
 19-3    paid or settled.
 19-4          (g)  If the district transfers the land, buildings,
 19-5    improvements, equipment, and other assets to a county or other
 19-6    governmental entity, the county or entity assumes all debts and
 19-7    obligations of the district at the time of the transfer and the
 19-8    district is dissolved.  If the district does not transfer the land,
 19-9    buildings, improvements, equipment, and other assets to a county or
19-10    other governmental entity, the board shall sell the assets and
19-11    liabilities to another person or administer the property, assets,
19-12    and debts of the district until all funds have been disposed of and
19-13    all district debts have been paid or settled, at which time the
19-14    district is dissolved.
19-15          (h)  After the board finds that the district is dissolved,
19-16    the board shall:
19-17                (1)  determine the debt owed by the district; and
19-18                (2)  impose on the property included in the district's
19-19    tax rolls a tax that is in proportion of the debt to the property
19-20    value.
19-21          (i)  When all outstanding debts and obligations of the
19-22    district are paid, the board shall order the secretary to return
19-23    the pro rata share of all unused tax money to each district
19-24    taxpayer.
19-25          (j)  A taxpayer may request that the taxpayer's share of
19-26    surplus tax money be credited to the taxpayer's county taxes.  If a
19-27    taxpayer requests the credit, the board shall direct the secretary
 20-1    to transmit the funds to the county tax assessor-collector.
 20-2          (k)  After the district has paid all its debts and has
 20-3    disposed of all its assets and funds as prescribed by this section,
 20-4    the board shall file a  written report with the Commissioners Court
 20-5    of Reagan County setting forth a summary of the board's actions in
 20-6    dissolving the district.
 20-7          (l)  Not later than the 10th day after the date it receives
 20-8    the report and determines that the requirements of this section
 20-9    have been fulfilled, the Commissioners Court of Reagan County shall
20-10    enter an order dissolving the district and releasing the board of
20-11    directors of the district from any further duty or obligation.
20-12          (m)  The district may provide for the sale or transfer of the
20-13    district's assets and liabilities to another person or entity.  The
20-14    dissolution of the district and the sale or transfer of the
20-15    district's assets and liabilities to another person or entity may
20-16    not contravene a trust indenture or bond resolution relating to the
20-17    outstanding bonds of the district.  The dissolution and sale or
20-18    transfer does not diminish or impair the rights of a holder of an
20-19    outstanding bond, warrant, or other obligation of the district.
20-20          (n)  The sale or transfer of the district's assets and
20-21    liabilities must satisfy the debt and bond obligations of the
20-22    district in a manner that protects the interests of the residents
20-23    of the district, including the residents' collective property
20-24    rights in the district's assets.  A grant from federal funds is an
20-25    obligation to be repaid in satisfaction.  The district may not
20-26    transfer or dispose of the district's assets except for due
20-27    compensation unless the transfer is made to another governmental
 21-1    entity that serves the district and the transferred assets are to
 21-2    be used for the benefit of the residents of the district.
 21-3          SECTION 12. (a)  Before the date a person may file for a
 21-4    place on the ballot for election to  the board of directors of the
 21-5    Reagan Hospital District of Reagan County, Texas,  in 2002, the
 21-6    board shall establish staggered terms for the director positions
 21-7    and determine which director positions will be elected by place and
 21-8    which positions will be elected at-large. In establishing staggered
 21-9    terms for directors after the effective date of this Act, the board
21-10    may provide for the term of a director then in office to continue
21-11    as necessary until the first election after the effective date of
21-12    this Act for that director position.
21-13          (b)  The election of the members of the Board of Directors of
21-14    the  Reagan Hospital District of Reagan County, Texas, and any
21-15    governmental acts and proceedings of the district occurring before
21-16    the effective date of this Act are validated as of the dates they
21-17    occurred. The elections, acts, and proceedings may not be held
21-18    invalid because they were not performed in accordance with law.
21-19          (c)  This Act does not apply to any matter that on the
21-20    effective date of this Act:
21-21                (1)  is involved in litigation if the litigation
21-22    ultimately results in the matter being held invalid by a final
21-23    judgment of a court of competent jurisdiction; or
21-24                (2)  has been held invalid by a final judgment of a
21-25    court of competent jurisdiction.
21-26          SECTION 13.  This Act takes effect September 1, 2001.