1-1 By: Sibley S.B. No. 1824 1-2 (In the Senate - Filed April 23, 2001; April 23, 2001, read 1-3 first time and referred to Committee on Intergovernmental 1-4 Relations; May 2, 2001, reported favorably by the following vote: 1-5 Yeas 6, Nays 0; May 2, 2001, sent to printer.) 1-6 A BILL TO BE ENTITLED 1-7 AN ACT 1-8 relating to the creation, administration, powers, duties, 1-9 operation, and financing of a hospital district to be known as the 1-10 West Medical District; authorizing a tax; granting the authority to 1-11 issue and refund bonds; and granting the power of eminent domain. 1-12 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-13 ARTICLE 1. GENERAL PROVISIONS 1-14 SECTION 1.01. DEFINITIONS. In this Act: 1-15 (1) "District" means the West Medical District. 1-16 (2) "Board" means the board of directors of the 1-17 district. 1-18 (3) "Director" means a member of the board. 1-19 SECTION 1.02. DISTRICT AUTHORIZATION. A hospital district 1-20 to be known as the West Medical District may be created and 1-21 established and, if created, must be maintained, operated, and 1-22 financed in the manner provided by Section 9, Article IX, Texas 1-23 Constitution, and by this Act. 1-24 SECTION 1.03. BOUNDARIES. The boundaries of the district 1-25 are coextensive with the boundaries of the West Independent School 1-26 District in McLennan County. 1-27 SECTION 1.04. ELECTION CODE PROVISIONS. Section 41.001(a), 1-28 Election Code, does not apply to an election ordered under this 1-29 Act. 1-30 ARTICLE 2. TEMPORARY DIRECTORS 1-31 SECTION 2.01. TEMPORARY DIRECTORS. On the effective date of 1-32 this Act, the following persons become temporary directors of the 1-33 district: 1-34 (1) John Crowder; 1-35 (2) Roby Urbanovsky; 1-36 (3) Larry Sparks; 1-37 (4) Jeanette Karlik; 1-38 (5) Robby Payne; 1-39 (6) Tommy Muska; and 1-40 (7) Kirk Wines. 1-41 SECTION 2.02. VACANCY IN OFFICE. The directors remaining 1-42 after a vacancy in the office of a temporary director shall fill 1-43 the vacancy by appointment by majority vote. 1-44 ARTICLE 3. CREATION OF DISTRICT 1-45 SECTION 3.01. CREATION ELECTION. The district may be 1-46 created and a tax may be authorized only if the creation and the 1-47 tax are approved by a majority of the qualified voters of the 1-48 territory of the proposed district voting at an election called and 1-49 held for that purpose. 1-50 SECTION 3.02. ORDERING ELECTION. (a) A majority of the 1-51 temporary directors of the district may order a creation election 1-52 to be held as prescribed by Subsection (c) of this section. 1-53 (b) On presentation of a petition for a creation election 1-54 signed by at least 50 of the registered voters of the territory of 1-55 the proposed district, according to the most recent official list 1-56 of registered voters, the temporary directors shall order an 1-57 election to be held as prescribed by Subsection (c) of this 1-58 section. The election shall be called not later than the 60th day 1-59 after the date the petition is presented to the district. 1-60 (c) The election order must call for an election to be held 1-61 in the territory within the West Independent School District 1-62 boundaries in McLennan County. 1-63 SECTION 3.03. ELECTION ORDER. The order calling the 1-64 election must state: 2-1 (1) the nature of the election, including the 2-2 proposition that is to appear on the ballot; 2-3 (2) the date of the election; 2-4 (3) the hours during which the polls will be open; and 2-5 (4) the location of the polling places. 2-6 SECTION 3.04. NOTICE. The temporary directors shall give 2-7 notice of the election by publishing a substantial copy of the 2-8 election order in a newspaper of general circulation in the 2-9 proposed district once a week for two consecutive weeks. The first 2-10 publication must appear at least 35 days before the date set for 2-11 the election. 2-12 SECTION 3.05. ELECTION DATE. The election shall be held not 2-13 less than 45 days or more than 60 days after the date on which the 2-14 election is ordered. 2-15 SECTION 3.06. BALLOT PROPOSITION. The ballot for the 2-16 election shall be printed to permit voting for or against the 2-17 proposition: "The creation of a hospital district to be known as 2-18 the West Medical District and the levy of annual taxes for hospital 2-19 purposes at a rate not to exceed 75 cents on each $100 valuation of 2-20 all taxable property in the district." 2-21 SECTION 3.07. CANVASSING RETURNS. (a) The temporary 2-22 directors shall meet and canvass the returns of the election. 2-23 (b) If a majority of the votes cast at the election favor 2-24 creation of the district, the temporary directors shall declare the 2-25 district created and shall enter the results in their minutes. 2-26 (c) If the creation of the district is defeated, the 2-27 temporary directors may call and hold another creation election, 2-28 but another creation election may not be called and held before the 2-29 first anniversary of the date of the most recent creation election. 2-30 SECTION 3.08. EXPIRATION OF ACT. If the creation of the 2-31 district is not approved at an election held before the fifth 2-32 anniversary of the effective date of this Act, this Act expires. 2-33 ARTICLE 4. DISTRICT ADMINISTRATION 2-34 SECTION 4.01. BOARD OF DIRECTORS. (a) The district is 2-35 governed by a board of seven directors. 2-36 (b) From the time the creation of the district is approved 2-37 until the elected directors take office, the temporary directors 2-38 serve as directors of the district. 2-39 SECTION 4.02. INITIAL DIRECTORS ELECTION. (a) Directors 2-40 shall be elected at an election to be held on the first Saturday in 2-41 May following the creation of the district. 2-42 (b) At the initial election of directors following creation 2-43 of the district, members of the board of directors shall be elected 2-44 at large on a single ballot, with the seven candidates receiving 2-45 the highest number of votes being elected as directors. The 2-46 directors elected at the initial election shall draw lots to 2-47 determine which two directors shall serve one-year terms, which two 2-48 directors shall serve two-year terms, and which three directors 2-49 shall serve three-year terms. 2-50 SECTION 4.03. METHOD OF ELECTION; STAGGERED TERMS; TERM OF 2-51 OFFICE; ELECTION DATE. (a) After the initial election of 2-52 directors following creation of the district, an election shall be 2-53 held on the first Saturday in May each year to elect the 2-54 appropriate number of successor directors. 2-55 (b) The directors shall be elected at large. 2-56 (c) Except as provided by Subsection (b), Section 4.02 of 2-57 this Act, each director is elected for a three-year term. 2-58 SECTION 4.04. NOTICE OF ELECTION. Notice of each election 2-59 of directors shall be published in a newspaper of general 2-60 circulation in the district in accordance with Chapter 4, Election 2-61 Code. 2-62 SECTION 4.05. APPLICATION. A person who wishes to have the 2-63 person's name printed on the ballot as a candidate for director 2-64 must file an application with the secretary of the board of 2-65 directors in accordance with Chapter 144, Election Code. 2-66 SECTION 4.06. QUALIFICATIONS FOR OFFICE. (a) To be 2-67 eligible to be a candidate for or to serve as a director, a person 2-68 must be: 2-69 (1) a resident of the district; and 3-1 (2) a qualified voter. 3-2 (b) An employee of the district may not serve as a director. 3-3 SECTION 4.07. BOND. (a) Before assuming the duties of the 3-4 office, each director must execute a bond for $5,000 payable to the 3-5 district, conditioned on the faithful performance of the person's 3-6 duties as director. 3-7 (b) The bond shall be kept in the permanent records of the 3-8 district. 3-9 (c) The board may pay for the director's bond with district 3-10 funds. 3-11 SECTION 4.08. BOARD VACANCY. A vacancy in the office of 3-12 director shall be filled for the unexpired term by appointment by 3-13 the remaining directors. 3-14 SECTION 4.09. OFFICERS; OFFICERS' TERMS; VACANCY. (a) The 3-15 board shall elect from among its members a president and a vice 3-16 president. 3-17 (b) The board shall appoint a secretary, who need not be a 3-18 director. 3-19 (c) Each officer of the board serves for a term of one year. 3-20 (d) The board shall fill a vacancy in a board office for the 3-21 unexpired term. 3-22 SECTION 4.10. COMPENSATION. (a) Directors and officers 3-23 serve without compensation but may be reimbursed for actual 3-24 expenses incurred in the performance of official duties. 3-25 (b) Expenses reimbursed under this section must be: 3-26 (1) reported in the district's minute book or other 3-27 district records; and 3-28 (2) approved by the board. 3-29 SECTION 4.11. QUORUM; VOTING REQUIREMENT. (a) A majority 3-30 of the membership of the board constitutes a quorum for the 3-31 transaction of business. 3-32 (b) When a quorum is present, a majority of the members of 3-33 the board voting must concur in a matter relating to the business 3-34 of the district. 3-35 SECTION 4.12. ADMINISTRATOR AND ASSISTANT ADMINISTRATOR. 3-36 (a) The board may appoint a qualified person as administrator of 3-37 the district and may in its discretion appoint an assistant to the 3-38 administrator. 3-39 (b) The administrator and assistant administrator, if any, 3-40 serve at the will of the board. 3-41 (c) The administrator and assistant administrator, if any, 3-42 are entitled to compensation as determined by the board. 3-43 (d) The administrator shall supervise all the work and 3-44 activities of the district and shall have general direction of the 3-45 affairs of the district, subject to any limitations the board may 3-46 prescribe. 3-47 (e) Before assuming the duties of administrator, the 3-48 administrator shall execute a bond payable to the district in an 3-49 amount not less than $5,000 as determined by the board, conditioned 3-50 on the administrator's performing the administrator's duties 3-51 required under this Act. The board may pay for the bond with 3-52 district funds. 3-53 (f) The board may delegate to the administrator the 3-54 authority to employ or contract with persons for the district. 3-55 SECTION 4.13. APPOINTMENTS TO STAFF. The board may: 3-56 (1) appoint to the staff any doctors the board 3-57 considers necessary for the efficient operation of the district; 3-58 and 3-59 (2) make temporary appointments the board considers 3-60 necessary. 3-61 SECTION 4.14. TECHNICIANS, NURSES, AND OTHER DISTRICT 3-62 EMPLOYEES. The district may employ or contract with technicians, 3-63 nurses, fiscal agents, accountants, architects, attorneys, and 3-64 other necessary employees. 3-65 ARTICLE 5. POWERS AND DUTIES 3-66 SECTION 5.01. RESPONSIBILITY OF GOVERNMENTAL ENTITY. 3-67 (a) On creation of the district, the West Hospital Authority may, 3-68 in the authority's sole discretion, convey or transfer to the 3-69 district: 4-1 (1) title to any land, buildings, improvements, or 4-2 equipment related to the hospital system that is owned by the West 4-3 Hospital Authority; 4-4 (2) operating funds and reserves for operating 4-5 expenses and funds that have been budgeted by the West Hospital 4-6 Authority to provide medical care for residents of the district for 4-7 the remainder of the fiscal year in which the district is 4-8 established; and 4-9 (3) accounts receivable of the West Hospital Authority 4-10 for medical care provided for residents of the district. 4-11 (b) The West Hospital Authority shall convey or transfer to 4-12 the district funds established for payment of indebtedness assumed 4-13 by the district. 4-14 (c) Except as provided by Subsection (b) of this section, 4-15 nothing in this Act requires the West Hospital Authority to convey 4-16 or transfer any funds or interest in property to the district. 4-17 (d) On creation of the district, McLennan County may 4-18 transfer to the district: 4-19 (1) any taxes levied by McLennan County for hospital 4-20 purposes for residents of the district for the year in which the 4-21 district is created; or 4-22 (2) any accounts receivable of McLennan County for 4-23 medical care provided for residents of the district. 4-24 SECTION 5.02. LIMITATION ON GOVERNMENTAL ENTITY. On or 4-25 after creation of the district, another governmental entity, 4-26 including a county or municipality, in which the district is 4-27 located may not levy taxes or issue bonds or other obligations for 4-28 hospital purposes or for providing medical care for the residents 4-29 of the district. 4-30 SECTION 5.03. DISTRICT RESPONSIBILITIES. (a) On creation 4-31 of the district, the district: 4-32 (1) assumes full responsibility for operating hospital 4-33 facilities and for furnishing medical and hospital care for the 4-34 district's needy inhabitants; 4-35 (2) assumes any outstanding indebtedness incurred by a 4-36 county, municipality, or other governmental entity in which all or 4-37 part of the district is located in providing hospital care for 4-38 residents of the territory of the district before the district's 4-39 creation; and 4-40 (3) may operate or provide for the operation of a 4-41 mobile emergency medical service. 4-42 (b) If part of a county, municipality, or other governmental 4-43 entity is included in the district and part is not included in the 4-44 district, the amount of indebtedness the district assumes under 4-45 Subdivision (2), Subsection (a) of this section, is the portion of 4-46 the total outstanding indebtedness of the county, municipality, or 4-47 other entity for hospital care for all residents of the county, 4-48 municipality, or other entity that the value of taxable property in 4-49 the district bears to the total value of taxable property in the 4-50 county, municipality, or other entity according to the last 4-51 preceding approved assessment rolls of the county, municipality, or 4-52 other entity before the district is confirmed. 4-53 SECTION 5.04. MANAGEMENT, CONTROL, AND ADMINISTRATION. The 4-54 board shall manage, control, and administer the hospital system and 4-55 the funds and resources of the district. 4-56 SECTION 5.05. DISTRICT RULES. The board may adopt rules 4-57 governing the operations of the hospital and hospital system and 4-58 the duties, functions, and responsibilities of district staff and 4-59 employees. 4-60 SECTION 5.06. METHODS AND PROCEDURES. The board may 4-61 prescribe: 4-62 (1) the method of making purchases and expenditures by 4-63 and for the district; and 4-64 (2) accounting and control procedures for the 4-65 district. 4-66 SECTION 5.07. HOSPITAL PROPERTY, FACILITIES, EQUIPMENT, AND 4-67 SERVICES. (a) The board shall determine the type, number, and 4-68 location of buildings required to establish and maintain an 4-69 adequate hospital system and the type of equipment necessary for 5-1 hospital care. 5-2 (b) The board has complete discretion as to the type and 5-3 extent of services the district will offer. The district may 5-4 provide any services or facilities the board finds necessary for 5-5 hospital or medical care, including: 5-6 (1) emergency medical services; 5-7 (2) primary care clinics; 5-8 (3) outpatient clinics; 5-9 (4) home health agencies; 5-10 (5) pharmacies; 5-11 (6) nursing facilities; 5-12 (7) assisted living facilities; 5-13 (8) blood banks; 5-14 (9) community mental health centers; 5-15 (10) alcohol or chemical dependency centers; 5-16 (11) minor emergency centers; 5-17 (12) research centers; or 5-18 (13) laboratories. 5-19 (c) The board may: 5-20 (1) acquire property, facilities, and equipment for 5-21 the district for use in the hospital system; 5-22 (2) mortgage or pledge the property, facilities, or 5-23 equipment acquired as security for the payment of the purchase 5-24 price; 5-25 (3) transfer by lease to physicians, individuals, 5-26 companies, corporations, or other legal entities or acquire by 5-27 lease district hospital facilities; and 5-28 (4) sell or otherwise dispose of property, facilities, 5-29 or equipment. 5-30 SECTION 5.08. CONSTRUCTION CONTRACTS. (a) The board may 5-31 enter into construction contracts on behalf of the district. 5-32 (b) A contract for construction in excess of the amount 5-33 provided by Section 271.024, Local Government Code, may be made 5-34 only after competitive bidding as provided by Subchapter B, Chapter 5-35 271, Local Government Code. 5-36 (c) Chapter 2253, Government Code, as it relates to 5-37 performance and payment bonds, applies to construction contracts 5-38 let by the district. 5-39 SECTION 5.09. DISTRICT OPERATING AND MANAGEMENT CONTRACTS. 5-40 The board may enter into operating or management contracts relating 5-41 to hospital facilities on behalf of the district. 5-42 SECTION 5.10. EMINENT DOMAIN. (a) The district may 5-43 exercise the power of eminent domain to acquire a fee simple or 5-44 other interest in property located in the territory of the district 5-45 if the property interest is necessary to the exercise of the rights 5-46 or authority conferred by this Act. 5-47 (b) The district must exercise the power of eminent domain 5-48 in the manner provided by Chapter 21, Property Code, but the 5-49 district is not required to deposit in the trial court money or 5-50 bond as provided by Section 21.021(a), Property Code. 5-51 (c) In a condemnation proceeding brought by the district, 5-52 the district is not required to: 5-53 (1) pay in advance or give bond or other security for 5-54 costs in the trial court; 5-55 (2) give bond for the issuance of a temporary 5-56 restraining order or a temporary injunction; or 5-57 (3) give bond for costs or supersedeas on an appeal or 5-58 writ of error. 5-59 SECTION 5.11. EXPENSES FOR MOVING FACILITIES OF RAILROADS 5-60 AND UTILITIES. If, in exercising the power of eminent domain, the 5-61 board requires relocating, raising, lowering, rerouting, changing 5-62 the grade, or altering the construction of any railroad, highway, 5-63 pipeline, or electric transmission and electric distribution, 5-64 telegraph, or telephone lines, conduits, poles, or facilities, the 5-65 district must bear the actual cost of relocating, raising, 5-66 lowering, rerouting, changing the grade, or altering the 5-67 construction to provide comparable replacement without enhancement 5-68 of a facility, after deducting the net salvage value derived from 5-69 the old facility. 6-1 SECTION 5.12. INDIGENT CARE. (a) The district shall supply 6-2 care and treatment without charge to a patient who resides in the 6-3 district if the patient or relative who is legally responsible for 6-4 the patient's support cannot pay for the care and treatment. 6-5 (b) The board shall determine the health care services to be 6-6 provided to residents eligible for assistance under this section to 6-7 fulfill the district's obligations under Section 9, Article IX, 6-8 Texas Constitution, and Section 61.055, Health and Safety Code. 6-9 The board may enter into a contract with another entity to fulfill 6-10 its obligations under this Act, Section 9, Article IX, Texas 6-11 Constitution, and Section 61.055, Health and Safety Code. 6-12 (c) Not later than the first day of each operating year, the 6-13 district shall adopt an application procedure to determine 6-14 eligibility for assistance, as provided by Section 61.053, Health 6-15 and Safety Code. 6-16 (d) The administrator of the district may have an inquiry 6-17 made into the financial circumstances of: 6-18 (1) a patient residing in the district and admitted to 6-19 a district facility; and 6-20 (2) a relative of the patient who is legally 6-21 responsible for the patient's support. 6-22 (e) On finding that the patient or a relative of the patient 6-23 legally responsible for the patient's support can pay for all or 6-24 any part of the care and treatment provided by the district, the 6-25 administrator shall report that finding to the board, and the board 6-26 shall issue an order directing the patient or the relative to pay 6-27 the district each week a specified amount that the individual is 6-28 able to pay. 6-29 (f) The administrator may collect money owed to the district 6-30 from the estate of the patient or from that of a relative who was 6-31 legally responsible for the patient's support in the manner 6-32 provided by law for collection of expenses in the last illness of a 6-33 deceased person. 6-34 (g) If there is a dispute relating to an individual's 6-35 ability to pay or if the administrator has any doubt concerning the 6-36 individual's ability to pay, the board shall call witnesses, hear 6-37 and resolve the question, and issue a final order. An appeal from 6-38 a final order of the board must be made to a district court in the 6-39 county in which the district is located, and the substantial 6-40 evidence rule applies. 6-41 SECTION 5.13. REIMBURSEMENT FOR SERVICES. (a) The board 6-42 shall require reimbursement from a county, municipality, or public 6-43 hospital located outside the boundaries of the district for the 6-44 district's care and treatment of a sick, diseased, or injured 6-45 person of that county, municipality, or public hospital as provided 6-46 by Chapter 61, Health and Safety Code. 6-47 (b) The board shall require reimbursement from the sheriff 6-48 or police chief of a county or municipality for the district's care 6-49 and treatment of a person confined in a jail facility of the county 6-50 or municipality who is not a resident of the district. 6-51 (c) The board may contract with the state or federal 6-52 government for the state or federal government to reimburse the 6-53 district for treatment of a sick, diseased, or injured person. 6-54 SECTION 5.14. SERVICE CONTRACTS. The board may contract 6-55 with a municipality, county, special district, or other political 6-56 subdivision of the state or with a state or federal agency for the 6-57 district to: 6-58 (1) furnish a mobile emergency medical service; or 6-59 (2) provide for the investigatory or welfare needs of 6-60 inhabitants of the district. 6-61 SECTION 5.15. GIFTS AND ENDOWMENTS. On behalf of the 6-62 district, the board may accept gifts and endowments to be held in 6-63 trust for any purpose and under any direction, limitation, or 6-64 provision prescribed in writing by the donor that is consistent 6-65 with the proper management of the district. 6-66 SECTION 5.16. AUTHORITY TO SUE AND BE SUED. The board may 6-67 sue and be sued on behalf of the district. 6-68 SECTION 5.17. RETIREMENT BENEFITS. The board may provide 6-69 retirement benefits for the employees of the district by 7-1 establishing or administering a retirement program or electing to 7-2 participate in any statewide retirement system in which the 7-3 district is eligible to participate. 7-4 SECTION 5.18. RECRUITMENT OF STAFF AND EMPLOYEES. The board 7-5 may spend district funds, enter into agreements, and take other 7-6 necessary action to recruit physicians, nurses, and other persons 7-7 to serve as medical staff members or employees of the district, 7-8 including: 7-9 (1) advertising and marketing; 7-10 (2) paying travel, recruitment, and relocation 7-11 expenses; 7-12 (3) providing a loan or scholarship to a physician or 7-13 a person currently enrolled in health care education courses at an 7-14 institution of higher education who contractually agrees to become 7-15 a district employee or medical staff member; or 7-16 (4) contracting with one or more full-time medical 7-17 students or other students in a health occupation, each of whom 7-18 shall be enrolled in and in good standing at an accredited medical 7-19 school, college, or university, to pay the student's tuition or 7-20 other expenses in consideration of the student's agreement to serve 7-21 as an employee or independent contractor for the district. 7-22 SECTION 5.19. NONPROFIT CORPORATION. The district may 7-23 sponsor and create a nonprofit corporation under the Texas 7-24 Non-Profit Corporation Act (Article 1396-1.01 et seq., Vernon's 7-25 Texas Civil Statutes), and may contribute funds to or solicit funds 7-26 for the corporation. The corporation may use district funds only 7-27 to provide health care or other services the district is authorized 7-28 to provide under this Act. The board shall establish adequate 7-29 controls to ensure that the corporation uses its funds as required 7-30 by law. The corporation may invest corporation funds in any manner 7-31 in which the district may invest funds, including investing funds 7-32 as authorized by Chapter 2256, Government Code. 7-33 ARTICLE 6. DISTRICT FINANCES 7-34 SECTION 6.01. FISCAL YEAR. (a) The district operates on 7-35 the fiscal year established by the board. 7-36 (b) The fiscal year may not be changed if revenue bonds of 7-37 the district are outstanding or more than once in a 24-month 7-38 period. 7-39 SECTION 6.02. ANNUAL AUDIT. The board annually shall have 7-40 an audit made of the financial condition of the district. 7-41 SECTION 6.03. DISTRICT AUDIT AND RECORDS. The annual audit 7-42 and other district records are open to inspection during regular 7-43 business hours at the principal office of the district. 7-44 SECTION 6.04. ANNUAL BUDGET. (a) The administrator of the 7-45 district shall prepare a proposed annual budget for the district. 7-46 (b) The proposed budget must contain a complete financial 7-47 statement, including a statement of: 7-48 (1) the outstanding obligations of the district; 7-49 (2) the amount of cash on hand to the credit of each 7-50 fund of the district; 7-51 (3) the amount of money received by the district from 7-52 all sources during the previous year; 7-53 (4) the amount of money available to the district from 7-54 all sources during the ensuing year; 7-55 (5) the amount of the balances expected at the end of 7-56 the year in which the budget is being prepared; 7-57 (6) the estimated amount of revenues and balances 7-58 available to cover the proposed budget; and 7-59 (7) the estimated tax rate that will be required. 7-60 SECTION 6.05. NOTICE; HEARING; ADOPTION OF BUDGET. (a) The 7-61 board shall hold a public hearing on the proposed annual budget. 7-62 (b) The board shall publish notice of the hearing in a 7-63 newspaper of general circulation in the district not later than the 7-64 10th day before the date of the hearing. 7-65 (c) Any resident of the district is entitled to be present 7-66 and participate at the hearing. 7-67 (d) At the conclusion of the hearing, the board shall adopt 7-68 a budget by acting on the budget proposed by the administrator. 7-69 The board may make any changes in the proposed budget that in its 8-1 judgment the interests of the taxpayers demand. 8-2 (e) The budget is effective only after adoption by the 8-3 board. 8-4 SECTION 6.06. AMENDING BUDGET. After adoption, the annual 8-5 budget may be amended on the board's approval. 8-6 SECTION 6.07. LIMITATION ON EXPENDITURES. Money may not be 8-7 spent for an expense not included in the annual budget or an 8-8 amendment to it. 8-9 SECTION 6.08. SWORN STATEMENT. As soon as practicable after 8-10 the close of the fiscal year, the administrator shall prepare for 8-11 the board a sworn statement of the amount of money that belongs to 8-12 the district and an account of the disbursements of that money. 8-13 SECTION 6.09. BORROWING MONEY. (a) The district may borrow 8-14 money at a rate not to exceed the minimum annual percentage rate 8-15 allowed by law for district obligations at the time of the loan. 8-16 (b) To secure a loan, the board may pledge: 8-17 (1) the revenues of the district that are not pledged 8-18 to pay the bonded indebtedness of the district; 8-19 (2) district taxes to be levied by the district during 8-20 the 12-month period following the date of the pledge that are not 8-21 pledged to pay the principal of or interest on district bonds; or 8-22 (3) district bonds that have been authorized but not 8-23 sold. 8-24 (c) A loan for which taxes or bonds are pledged shall mature 8-25 not later than the first anniversary of the date on which the loan 8-26 is made. A loan for which district revenues are pledged shall 8-27 mature not later than the fifth anniversary of the date on which 8-28 the loan is made. 8-29 SECTION 6.10. DEPOSITORY. (a) The board shall name at 8-30 least one bank to serve as depository for district funds. 8-31 (b) District funds, other than those transmitted to a bank 8-32 for payment of bonds or obligations issued or assumed by the 8-33 district, shall be deposited as received with the depository bank 8-34 and must remain on deposit. This subsection does not limit the 8-35 power of the board to place a portion of district funds on time 8-36 deposit or to purchase certificates of deposit. 8-37 (c) Before the district deposits funds in a bank in an 8-38 amount that exceeds the maximum amount secured by the Federal 8-39 Deposit Insurance Corporation, the bank must execute a bond or 8-40 other security in an amount sufficient to secure from loss the 8-41 district funds that exceed the amount secured by the Federal 8-42 Deposit Insurance Corporation. 8-43 ARTICLE 7. BONDS 8-44 SECTION 7.01. GENERAL OBLIGATION BONDS. The board may issue 8-45 and sell bonds authorized by an election in the name and on the 8-46 faith and credit of the district to: 8-47 (1) purchase, construct, acquire, repair, or renovate 8-48 buildings or improvements; 8-49 (2) equip buildings or improvements for hospital 8-50 purposes; or 8-51 (3) acquire and operate a mobile emergency medical 8-52 service. 8-53 SECTION 7.02. TAXES TO PAY BONDS. (a) At the time the 8-54 bonds are issued by the district, the board shall levy a tax. 8-55 (b) The tax must be sufficient to create an interest and 8-56 sinking fund to pay the principal of and interest on the bonds as 8-57 the bonds mature. 8-58 (c) In any year, the tax together with any other tax the 8-59 district levies may not exceed the limit approved by the voters at 8-60 the election authorizing the levy of taxes. 8-61 SECTION 7.03. BOND ELECTION. (a) The district may issue 8-62 general obligation bonds only if the bonds are authorized by a 8-63 majority of the qualified voters of the district voting at an 8-64 election called and held for that purpose under this section. 8-65 (b) The board may order a bond election. The order calling 8-66 the election must state: 8-67 (1) the nature and date of the election; 8-68 (2) the hours during which the polls will be open; 8-69 (3) the location of the polling places; 9-1 (4) the amounts of bonds to be authorized; and 9-2 (5) the maximum maturity of the bonds. 9-3 (c) Notice of a bond election shall be given as provided by 9-4 Chapter 1251, Government Code. 9-5 (d) The board shall canvass the returns and declare the 9-6 results of the election. 9-7 SECTION 7.04. REVENUE BONDS. (a) The board may issue bonds 9-8 to: 9-9 (1) purchase, construct, acquire, repair, equip, or 9-10 renovate buildings or improvements for hospital purposes; 9-11 (2) acquire sites to be used for hospital purposes; or 9-12 (3) acquire and operate a mobile emergency medical 9-13 service to assist the district in carrying out the district's 9-14 hospital purpose. 9-15 (b) The bonds must be payable from and secured by a pledge 9-16 of all or part of the revenues derived from the operation of the 9-17 district's hospital system. The bonds may be additionally secured 9-18 by a mortgage or deed of trust lien on all or part of district 9-19 property. 9-20 (c) The bonds must be issued in the manner provided by 9-21 Sections 264.042, 264.043, 264.046, 264.047, 264.048, and 264.049, 9-22 Health and Safety Code, for issuance of revenue bonds by county 9-23 hospital authorities. 9-24 SECTION 7.05. REFUNDING BONDS. (a) Refunding bonds of the 9-25 district may be issued to refund and pay off any outstanding 9-26 indebtedness the district has issued or assumed. 9-27 (b) The bonds must be issued in the manner provided by 9-28 Chapter 1207, Government Code. 9-29 SECTION 7.06. INTEREST AND MATURITY. District bonds must 9-30 mature not later than the 50th anniversary of the date of their 9-31 issuance and must bear interest at a rate not to exceed that 9-32 provided by Chapter 1204, Government Code. 9-33 SECTION 7.07. EXECUTION OF BONDS. The president of the 9-34 board shall execute the bonds in the name of the district, and the 9-35 secretary of the board shall countersign the bonds in the manner 9-36 provided by Chapter 618, Government Code. 9-37 SECTION 7.08. APPROVAL AND REGISTRATION OF BONDS. 9-38 (a) District bonds are subject to the same requirements with 9-39 regard to approval by the attorney general and registration by the 9-40 comptroller as the law provides for approval and registration of 9-41 bonds issued by counties. 9-42 (b) On approval by the attorney general and registration by 9-43 the comptroller, the bonds are incontestable for any cause. 9-44 SECTION 7.09. BONDS AS INVESTMENTS. District bonds and 9-45 indebtedness assumed by the district are legal and authorized 9-46 investments for: 9-47 (1) banks; 9-48 (2) savings banks; 9-49 (3) trust companies; 9-50 (4) savings and loan associations; 9-51 (5) insurance companies; 9-52 (6) fiduciaries; 9-53 (7) trustees; 9-54 (8) guardians; and 9-55 (9) sinking funds of municipalities, counties, school 9-56 districts, and other political subdivisions of the state and other 9-57 public funds of the state and its agencies, including the permanent 9-58 school fund. 9-59 SECTION 7.10. BONDS AS SECURITY FOR DEPOSITS. District 9-60 bonds are eligible to secure deposits of public funds of the state 9-61 and of municipalities, counties, school districts, and other 9-62 political subdivisions of the state. The bonds are lawful and 9-63 sufficient security for deposits to the extent of their value if 9-64 accompanied by all unmatured coupons. 9-65 SECTION 7.11. TAX STATUS OF BONDS. Because the district 9-66 created under this Act is a public entity performing an essential 9-67 public function, bonds issued by the district, any transaction 9-68 relating to the bonds, and profits made in the sale of the bonds 9-69 are free from taxation by the state or by any municipality, county, 10-1 special district, or other political subdivision of the state. 10-2 ARTICLE 8. TAXES 10-3 SECTION 8.01. LEVY OF TAXES. (a) The board annually may 10-4 impose property taxes in an amount not to exceed the limit approved 10-5 by the voters at the election authorizing the levy of taxes. 10-6 (b) The tax rate for all purposes may not exceed 75 cents on 10-7 each $100 valuation of all taxable property in the district. 10-8 (c) The taxes may be used to pay: 10-9 (1) the indebtedness issued or assumed by the 10-10 district; and 10-11 (2) the maintenance and operating expenses of the 10-12 district. 10-13 (d) The district may not impose taxes to pay the principal 10-14 of or interest on revenue bonds issued under this Act. 10-15 SECTION 8.02. BOARD AUTHORITY. The board may impose taxes 10-16 for the entire year in which the district is created. 10-17 SECTION 8.03. ADOPTING TAX RATE. In adopting the tax rate, 10-18 the board shall consider the income of the district from sources 10-19 other than taxation. 10-20 SECTION 8.04. TAX ASSESSMENT AND COLLECTION. (a) The Tax 10-21 Code governs the appraisal, assessment, and collection of district 10-22 taxes. 10-23 (b) The board may provide for the appointment of a tax 10-24 assessor-collector for the district or may contract for the 10-25 assessment and collection of taxes as provided by the Tax Code. 10-26 ARTICLE 9. DISSOLUTION OF DISTRICT 10-27 SECTION 9.01. DISSOLUTION ELECTION. The district may be 10-28 dissolved only if the dissolution is approved by a majority of the 10-29 qualified voters of the district voting in an election called and 10-30 held for that purpose. 10-31 SECTION 9.02. ORDERING ELECTION. (a) The board may order 10-32 an election on the question of dissolving the district and 10-33 disposing of the district's assets and obligations. 10-34 (b) The board shall order an election on the question of 10-35 dissolving the district and disposing of the district's assets and 10-36 obligations if the board receives a petition requesting an election 10-37 that is signed by a number of registered voters of the district 10-38 equal to at least 15 percent of the registered voters in the 10-39 district. 10-40 SECTION 9.03. ELECTION ORDER. The order calling the 10-41 election must state: 10-42 (1) the nature of the election, including the 10-43 proposition that is to appear on the ballot; 10-44 (2) the date of the election; 10-45 (3) the hours during which the polls will be open; and 10-46 (4) the location of the polling places. 10-47 SECTION 9.04. NOTICE. The board shall give notice of the 10-48 election by publishing a substantial copy of the election order in 10-49 a newspaper with general circulation in the district once a week 10-50 for two consecutive weeks. The first publication must appear at 10-51 least 35 days before the date set for the election. 10-52 SECTION 9.05. ELECTION DATE. (a) The election shall be 10-53 held not later than the 60th day after the date the election is 10-54 ordered. 10-55 (b) Section 41.001, Election Code, does not apply to an 10-56 election ordered under this section. 10-57 SECTION 9.06. BALLOT PROPOSITION. The ballot for an 10-58 election at which the dissolution of the district is proposed shall 10-59 be printed to permit voting for or against the proposition: "The 10-60 dissolution of the West Medical District." 10-61 SECTION 9.07. CANVASSING RETURNS. (a) The board shall 10-62 canvass the returns of the election. 10-63 (b) If a majority of the votes in the election favor 10-64 dissolution, the board shall find that the district is dissolved. 10-65 (c) If a majority of the votes in the election do not favor 10-66 dissolution, the board shall continue to administer the district, 10-67 and another election on the question of dissolution may not be held 10-68 before the first anniversary of the date of the most recent 10-69 election to dissolve the district. 11-1 SECTION 9.08. DISSOLUTION PROCEDURES. (a) If a majority of 11-2 the votes in the election favor dissolution, the board shall: 11-3 (1) transfer the land, buildings, improvements, 11-4 equipment, and other assets that belong to the district to a county 11-5 or another governmental entity in the county in which the district 11-6 is located; 11-7 (2) sell the assets and liabilities to another person 11-8 or entity; or 11-9 (3) administer the property, assets, and debts until 11-10 all funds have been disposed of and all district debts have been 11-11 paid or settled. 11-12 (b) If the district transfers the land, buildings, 11-13 improvements, equipment, and other assets to a county or other 11-14 governmental entity, the county or entity assumes all debts and 11-15 obligations of the district at the time of the transfer, at which 11-16 time the district is dissolved. If the district does not transfer 11-17 the land, buildings, improvements, equipment, and other assets to a 11-18 county or other governmental entity, or sell those assets and the 11-19 liabilities to another person, the board shall administer the 11-20 property, assets, and debts of the district until all funds have 11-21 been disposed of and all district debts have been paid or settled, 11-22 at which time the district is dissolved. 11-23 (c) After the board finds that the district is dissolved, 11-24 the board shall: 11-25 (1) determine the debt owed by the district; and 11-26 (2) impose on the property included in the district's 11-27 tax rolls a tax that is in proportion of the debt to the property 11-28 value. 11-29 (d) When all outstanding debts and obligations of the 11-30 district are paid, the board shall order the secretary to return 11-31 the pro rata share of all unused tax money to each district 11-32 taxpayer. 11-33 (e) A taxpayer may request that the taxpayer's share of 11-34 surplus tax money be credited to the taxpayer's county taxes. If a 11-35 taxpayer requests the credit, the board shall direct the secretary 11-36 to transmit the funds to the county tax assessor-collector. 11-37 (f) After the district has paid all of the district's debts 11-38 and has disposed of all of the district's assets and funds as 11-39 prescribed by this section, the board shall file a written report 11-40 with the Commissioners Court of McLennan County setting forth a 11-41 summary of the board's actions in dissolving the district. 11-42 (g) Not later than the 10th day after the date it receives 11-43 the report and determines that the requirements of this section 11-44 have been fulfilled, the Commissioners Court of McLennan County 11-45 shall enter an order dissolving the district and releasing the 11-46 board from any further duty or obligation. 11-47 SECTION 9.09. SALE OR TRANSFER OF ASSETS. (a) The district 11-48 may provide for the sale or transfer of the district's assets and 11-49 liabilities to another entity or person and the district's 11-50 subsequent dissolution. The dissolution of the district and the 11-51 sale or transfer of the district's assets and liabilities to 11-52 another person or entity may not contravene a trust indenture or 11-53 bond resolution relating to the outstanding bonds of the district. 11-54 The dissolution and sale or transfer does not diminish or impair 11-55 the rights of a holder of an outstanding bond, warrant, or other 11-56 obligation of the district. 11-57 (b) The sale or transfer of the district's assets and 11-58 liabilities must satisfy the debt and bond obligations of the 11-59 district in a manner that protects the interests of the residents 11-60 of the district, including the residents' collective property 11-61 rights in the district's assets. Any grant from federal funds is 11-62 considered an obligation to be repaid in satisfaction. The 11-63 district may not transfer or dispose of the district's assets 11-64 except for due compensation unless the transfer is made to another 11-65 governmental agency that serves the district and the transferred 11-66 assets are to be used for the benefit of residents of the district. 11-67 ARTICLE 10. MISCELLANEOUS 11-68 SECTION 10.01. LIMITATION ON STATE ASSISTANCE. The state 11-69 may not become obligated for the support or maintenance of a 12-1 hospital district created under this Act, nor may the legislature 12-2 make a direct appropriation for the construction, maintenance, or 12-3 improvement of a facility of the district. 12-4 SECTION 10.02. REQUIRED PUBLICATION. Proof of publication 12-5 of the notice required in the enactment of this Act under the 12-6 provisions of Section 9, Article IX, Texas Constitution, has been 12-7 made in the manner and form provided by law pertaining to the 12-8 enactment of local and special laws, and the notice is found and 12-9 declared proper and sufficient to satisfy the requirement. 12-10 SECTION 10.03. EFFECTIVE DATE. This Act takes effect 12-11 immediately if it receives a vote of two-thirds of all the members 12-12 elected to each house, as provided by Section 39, Article III, 12-13 Texas Constitution. If this Act does not receive the vote 12-14 necessary for immediate effect, this Act takes effect September 1, 12-15 2001. 12-16 * * * * *