By: Wentworth S.B. No. 739
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the powers and duties of the board of managers of
1-3 certain joint municipal and county hospitals, including the power
1-4 to issue revenue bonds.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Subchapter B, Chapter 265, Health and Safety
1-7 Code, is amended by adding Sections 265.017 through 265.019 to read
1-8 as follows:
1-9 Sec. 265.017. ISSUANCE OF REVENUE BONDS. (a) The board of
1-10 managers may issue and sell revenue bonds in the name of the
1-11 hospital to finance:
1-12 (1) the acquisition of real property, the construction
1-13 of hospital facilities, or the acquisition of equipment or supplies
1-14 necessary for the hospital to provide hospital services; or
1-15 (2) the installation of equipment necessary for the
1-16 hospital to provide hospital services.
1-17 (b) The board of managers has the powers of an issuer under
1-18 Chapter 1371, Government Code, and may enter into a credit
1-19 agreement under that chapter. A bond issued under this subchapter
1-20 is an obligation under Chapter 1371, Government Code, but is not
1-21 required to be rated as required by that chapter. In this
1-22 subsection, "credit agreement," "obligation," and "issuer" have the
1-23 meanings assigned by Section 1371.001, Government Code.
1-24 Sec. 265.0171. REPAYMENT OF BONDS. The board of managers
1-25 may provide for the payment of principal of and interest on the
2-1 bonds by pledging all or any part of the hospital's revenue derived
2-2 from the operation of the hospital or from other sources.
2-3 Sec. 265.0172. ADDITIONAL SECURITY FOR BONDS. The bonds may
2-4 be additionally secured by a deed of trust or mortgage lien on part
2-5 or all of the physical properties of the hospital and rights
2-6 appurtenant to those properties.
2-7 Sec. 265.0173. MATURITY. A bond issued under this
2-8 subchapter must mature not later than 40 years after its date.
2-9 Sec. 265.0174. BONDS NOT PAYABLE FROM TAXES. A bond issued
2-10 under this subchapter must contain the following provision: "The
2-11 holder of this obligation is not entitled to demand payment of this
2-12 obligation out of any money raised by taxation by (name of county)
2-13 or by (name of municipality) or from any other income of the county
2-14 or municipality. The board of managers of the hospital has no
2-15 taxing power."
2-16 Sec. 265.0175. SALE OF BONDS. The board of managers may
2-17 sell bonds issued under this subchapter at public or private sale
2-18 in the manner and on the terms approved by the board.
2-19 Sec. 265.0176. REFUNDING BONDS. (a) The board of managers
2-20 may refund bonds issued under this subchapter by issuing refunding
2-21 bonds under terms approved by the board.
2-22 (b) All appropriate provisions of this subchapter apply to
2-23 the refunding bonds. The refunding bonds shall be issued in the
2-24 manner provided by this subchapter for issuing other bonds.
2-25 (c) The refunding bonds may be sold and delivered in amounts
2-26 sufficient to pay the principal of and interest and any redemption
3-1 premium on the bonds to be refunded, at maturity or on any
3-2 redemption date.
3-3 (d) The refunding bonds may be issued to be exchanged for
3-4 the bonds being refunded by them. In that case, the comptroller
3-5 shall register the refunding bonds and deliver them to the holder
3-6 of the bonds being refunded as approved by the board. The exchange
3-7 may be made in one delivery or in installment deliveries.
3-8 Sec. 265.018. HOSPITAL PROPERTY. The board of managers may
3-9 acquire, hold, or dispose of property or an interest in property.
3-10 As agreed by the county and municipality, the county or
3-11 municipality may hold title to hospital property.
3-12 Sec. 265.0181. TRANSFER OF PROPERTY. On dissolution of the
3-13 board of managers, title to property held by the board shall be
3-14 transferred to the county and municipality as approved by the
3-15 board.
3-16 Sec. 265.019. USE OF EARNINGS OR ASSETS FOR PRIVATE PURPOSES
3-17 PROHIBITED. Except as reasonable compensation for services
3-18 rendered or reasonable allowance for authorized expenditures
3-19 incurred on behalf of the board of managers or the hospital, the
3-20 net earnings of the board or the hospital may not be used for the
3-21 benefit of a private officer, board member, individual, or
3-22 substantial contributor to the board of managers or the hospital.
3-23 The assets of the board or the hospital may not be distributed to,
3-24 divided among, be used for, accrue to, or benefit a private
3-25 officer, board member, individual, or substantial contributor to
3-26 the board or the hospital.
4-1 SECTION 2. This Act takes effect immediately if it receives
4-2 a vote of two-thirds of all the members elected to each house, as
4-3 provided by Section 39, Article III, Texas Constitution. If this
4-4 Act does not receive the vote necessary for immediate effect, this
4-5 Act takes effect September 1, 2001.