S.B. 1632 78 )    BILL ANALYSIS


S.B. 1632
By: Wentworth
County Affairs
Committee Report (Unamended)



BACKGROUND AND PURPOSE 

Currently, most public county hospitals operate as a part of a hospital
district. However, the public hospitals of Guadalupe County and Medina
County are run by a board of managers jointly funded by a municipality and
the appropriate county. Current statute does not explicitly allow joint
county and municipal hospitals to pledge real property to obtain a bank
loan as other hospitals and districts are able to do under their statutes.
This bill will  afford these joint hospitals the same opportunities for
funding and growth that are available to all other hospitals in the state. 



RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any
additional rulemaking authority to a state officer, department, agency, or
institution. 

ANALYSIS

SB 1632 gives a joint county and municipal hospital the authority to
borrow money in the name of the hospital. 

Adds Section 265.0177 to allow the hospital to borrow money in the name of
the hospital. The allowable terms are laid out.  Both the prospect of a
loan and the terms must be found to be reasonable by the board of
managers. Certain safeguards are included in the bill such as the length
and terms of the loan, approval by the commissioners court and governing
body of the municipality, and a finding by the board of managers that
there will be sufficient revenue to repay the loan.  

Section 265.0178 is added to require the loan be repaid only from
revenues, income or resources of the hospital or secured by a deed  or
interest in the real property of the hospital. The holder of the loan may
not demand payment from any other resource of the hospital than what was
pledged.  

Section 265.0179 states the only purposes for which the loan money may be
used. It is limited to the costs and maintenance of hospital facilities
and real property. 
         
EFFECTIVE DATE

This Act takes effect immediately if it receives a vote of two-thirds of
all members elected to each house, as provided by Section 39, Article III,
Texas Constitution.  If this Act does not receive the vote necessary for
immediate effect, this Act takes effect September 1, 2003.