TLC: Special District Local Laws Code Proposed Chapters

80C106(1) MCK

CHAPTER 1043. HOPKINS COUNTY HOSPITAL DISTRICT

SUBCHAPTER A. GENERAL PROVISIONS

Revised Law

Sec. 1043.001. DEFINITIONS. In this chapter:

(1) "Board" means the board of directors of the district.

(2) "Director" means a member of the board.

(3) "District" means the Hopkins County Hospital District. (New.)

Revisor's Note

The definitions of "board," "director," and "district" are added to the revised law for drafting convenience and to eliminate frequent, unnecessary repetition of the substance of the definitions.

Revised Law

Sec. 1043.002. AUTHORITY FOR OPERATION. The Hopkins County Hospital District operates under the authority of and has the powers and responsibilities provided by Section 11, Article IX, Texas Constitution. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 1 (part).)

Source Law

Sec. 1. … [Article IX, Section 11, as a part of the Constitution of the State of Texas,] … this Act shall be operative so as to authorize the creation, establishment, maintenance and operation of a hospital district within the State of Texas, … said District shall have the powers and responsibilities provided by the aforesaid constitutional provision.

Revisor's Note

(1) Section 1, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, states that the act authorizing the creation of the Hopkins County Hospital District is operative on adoption of Section 11, Article IX, Texas Constitution. The revised law omits the statement as executed because the constitutional provision was adopted in 1961. The omitted law reads:

Sec. 1. Upon the adoption of Article IX, Section 11, as a part of the Constitution of the State of Texas, as proposed by Senate Joint Resolution No. 22 of the Fifty-seventh Legislature, Regular Session, 1961, … .

(2) Section 1, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, authorizes the "creation, establishment, maintenance and operation" of the district. The revised law omits "creation" and "establishment" as executed. The revised law omits "maintenance" because, in this context, the meaning of that term is included in the meaning of "operation."

(3) Section 2, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, authorizes Hopkins County to constitute a hospital district. The revised law omits this provision as executed because the district has been created as a separate entity. The omitted law reads:

Sec. 2. Hopkins County may be constituted a hospital district as hereinafter set out, and … .

Revised Law

Sec. 1043.003. ESSENTIAL PUBLIC FUNCTION; POLITICAL SUBDIVISION. The district is:

(1) a public entity performing an essential public function; and

(2) a political subdivision of this state. (Acts 57th Leg., 1st C.S., Ch. 43, Secs. 6D(d) (part), 18 (part).)

Source Law

[Sec. 6D]

(d) Because the district is a public entity performing an essential public function, … .

Sec. 18. The hospital district created under the provisions of this Act shall be and is declared to be a political subdivision of the State of Texas, and … .

Revised Law

Sec. 1043.004. DISTRICT TERRITORY. The boundaries of the district are coextensive with the boundaries of Hopkins County. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 1 (part).)

Source Law

Sec. 1. … such district to have boundaries coextensive with the boundaries of Hopkins County; … .

Revised Law

Sec. 1043.005. CORRECTION OF INVALID PROCEDURES. If a court holds that any procedure under this chapter violates the constitution of this state or of the United States, the district by resolution may provide an alternative procedure that conforms with the constitution. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 19 (part).)

Source Law

Sec. 19. … [Federal or State Constitutions,] … . Where any procedure hereunder may be held by any court to be violative of either of such Constitutions, the district shall have the power by resolution to provide an alternative procedure conformable with such Constitutions… .

Revisor's Note

Section 19, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that the act does not violate the federal or state constitution, and requires that action under the act comply with the constitutions. The revised law omits the reference to the federal constitution because, under the Supremacy Clause of the United States Constitution (Clause 2, Article VI), federal law always takes precedence over a state statute. The revised law also omits the reference to the Texas Constitution because the state cannot modify constitutional requirements by statute. The omitted law reads:

Sec. 19. Nothing in this Act shall be construed to violate any provision of the Federal or State Constitutions, and all acts done under this Act shall be in such manner as will conform thereto, whether expressly provided or not… .

Revisor's Note

(End of Subchapter)

Section 2, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides procedures for holding an election on the creation of the district and the imposition of an ad valorem tax. Because the creation of the district and the imposition of the tax were approved at the election, the revised law omits the relevant law as executed. The omitted law reads:

Sec. 2. … provided, however, that such hospital district shall not be created unless and until an election is duly held in the county for such purpose, which said election may be initiated by the Commissioners Court of the county upon its own motion or upon a petition of one hundred (100) resident qualified property taxpaying electors, to be held not less than thirty (30) days from the time said election is ordered by the Commissioners Court. At said election there shall be submitted to the qualified property taxpaying electors the proposition of whether or not a hospital district shall be created in the county; and a majority of the qualified property taxpaying electors participating in said election voting in favor of the proposition shall be necessary. The ballots shall have printed thereon:

"FOR the creation of a hospital district; providing for the levy of a tax not to exceed twenty-five cents (25¢) on the One Hundred Dollar valuation"; and

"AGAINST the creation of a hospital district; providing for the levy of a tax not to exceed twenty-five cents (25¢) on the One Hundred Dollar valuation."

If the county or city located therein, either or both of them, has any outstanding bonds theretofore issued for hospital purposes (which by the provisions of Section 7 of this Act are required to be assumed by the hospital district), then the ballots for such election shall, instead of the foregoing, have printed thereon:

"FOR the creation of a hospital district; providing for the levy of a tax not to exceed twenty-five cents (25¢) on the One Hundred Dollar valuation; and providing for the assumption by such district of all outstanding bonds heretofore issued by Hopkins County, and by any city in said county for hospital purposes"; and

"AGAINST the creation of a hospital district; providing for the levy of a tax not to exceed twenty-five cents (25¢) on the One Hundred Dollar valuation; and providing for the assumption by such district of all outstanding bonds heretofore issued by Hopkins County, and by any city in said county for hospital purposes."

[Sections 1043.006-1043.050 reserved for expansion]

SUBCHAPTER B. DISTRICT ADMINISTRATION

Revised Law

Sec. 1043.051. BOARD ELECTION; TERM. (a) The board consists of seven elected directors.

(b) Directors serve staggered three-year terms.

(c) An election shall be held on the uniform election date in May of each year to elect the appropriate number of directors. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 3 (part).)

Source Law

Sec. 3. The board of directors consists of seven (7) directors who serve staggered three-year terms. A director shall continue to serve until a successor has been duly elected or appointed and qualified… . A regular election of directors shall be held on the first Saturday in May of each year and … .

Revisor's Note

(1) Section 3, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that the directors serve until their successors are "duly elected or appointed and qualified." The revised law omits that provision because it duplicates Section 17, Article XVI, Texas Constitution, which provides that an officer in this state is to continue to perform the officer's official duties until a successor has qualified.

(2) Section 3, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, was amended in 1997 to require board elections on the "first Saturday in May." From 1986 to 2003, Section 41.001, Election Code, provided for a uniform election date for all political subdivisions on the first Saturday in May. In Chapter 1315, Acts of the 78th Legislature, Regular Session, 2003, the legislature amended Section 41.001 by moving the uniform election date in May to the third Saturday. In Chapter 1, Acts of the 78th Legislature, 3rd Called Session, 2003, the legislature amended Section 41.001 by moving the uniform election date in May back to the first Saturday. In Chapter 471, Acts of the 79th Legislature, Regular Session, 2005, the legislature amended Section 41.001 by moving the uniform election date in May to the second Saturday. The revised law substitutes "uniform election date in May" for "first Saturday in May" to reflect these changes while preserving as closely as possible legislative intent expressed in the 1997 amendment to Section 3 that the election be held on the first Saturday in May, which was at that time the uniform election date in May.

Revised Law

Sec. 1043.052. NOTICE OF ELECTION. At least 10 days before the date of an election of directors, notice of the election shall be published one time in a newspaper of general circulation in Hopkins County. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 3 (part).)

Source Law

Sec. 3. … [A regular election of directors] … notice of such election shall be published in a newspaper of general circulation in the county one (1) time at least ten (10) days prior to the date of election… .

Revisor's Note

Section 3, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, requires notice of a director's election to be published "in the county." Throughout this chapter, the revised law substitutes "Hopkins County" for the quoted language or similar language because Hopkins County is the county in which the district is located.

Revised Law

Sec. 1043.053. QUALIFICATIONS FOR OFFICE. (a) A person may not be elected or appointed as a director unless the person is:

(1) a district resident;

(2) a qualified voter of the district; and

(3) more than 21 years of age at the time of election or appointment.

(b) A district employee may not serve as a director. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 3 (part).)

Source Law

Sec. 3. … No person shall be appointed or elected as a member of the board of directors of said hospital district unless he is a resident and a qualified voter thereof and unless at the time of such election or appointment he shall be more than twenty-one (21) years of age. An employee of the Hopkins County Hospital District may not serve as a director of that district… .

Revised Law

Sec. 1043.054. BOND; RECORD OF BOND AND OATH OR AFFIRMATION OF OFFICE. (a) Each director shall execute a good and sufficient bond for $1,000 that is:

(1) payable to the district; and

(2) conditioned on the faithful performance of the director's duties.

(b) Each director's bond and constitutional oath or affirmation of office shall be deposited with the district's depository bank for safekeeping. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 3 (part).)

Source Law

Sec. 3. … Each member of the board of directors shall qualify by executing the constitutional oath of office and shall execute a good and sufficient bond for One Thousand Dollars ($1,000) payable to said district conditioned upon the faithful performance of his duties, and such oaths and bonds shall be deposited with the depository bank of the district for safekeeping… .

Revisor's Note

Section 3, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, requires each director to take the constitutional oath of office. The revised law omits that provision because Section 1, Article XVI, Texas Constitution, requires all officers in this state to take the oath (or affirmation) before assuming office. Additionally, the revised law provides for the deposit of the constitutional affirmation, as well as the constitutional oath, because Section 1, Article XVI, Texas Constitution, permits an officer in this state to take either the oath or affirmation.

Revised Law

Sec. 1043.055. BOARD VACANCY. (a) If a vacancy occurs in the office of director, the remaining directors shall appoint a director for the unexpired term.

(b) If the number of directors is reduced to less than the number that constitutes a majority for any reason, the remaining directors shall immediately call a special election to fill the vacancies. If the remaining directors do not call the election, a district court, on application of a district voter or taxpayer, may order the directors to hold the election. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 3 (part).)

Source Law

Sec. 3. … All vacancies in the office of director shall be filled for the unexpired term by appointment of the remainder of the board of directors. In the event the number of directors shall be reduced to less than the number that constitutes a majority for any reason, the remaining directors shall immediately call a special election to fill said vacancies, and upon failure to do so a district court may, upon application of any voter or taxpayer of the district, issue a mandate requiring that such election be ordered by the remaining directors… .

Revised Law

Sec. 1043.056. OFFICERS. The board shall elect a president, vice president, and secretary. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 3 (part).)

Source Law

Sec. 3. … The board of directors shall elect a president, a vice president, and a secretary… .

Revised Law

Sec. 1043.057. COMPENSATION; EXPENSES. A director serves without compensation but may be reimbursed for actual expenses incurred in the performance of official duties on approval of the expenses by the entire board. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 4 (part).)

Source Law

Sec. 4. … [the board of directors of the district] who shall serve without compensation but may be reimbursed for actual expenses incurred in the performance of their official duties upon the approval of such expenses by the entire board of directors.

Revised Law

Sec. 1043.058. VOTING REQUIREMENT. A concurrence of a majority of the directors is sufficient in any matter relating to district business. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 3 (part).)

Source Law

Sec. 3. … [board of directors] … a concurrence of a majority shall be sufficient in all matters pertaining to the business of the district… .

Revisor's Note

Section 3, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that a majority of the full membership of the board constitutes a quorum. The revised law omits that provision because it duplicates Section 311.013, Government Code (Code Construction Act), which provides that a quorum of a public body is a majority of the number of members fixed by statute. The omitted law reads:

Sec. 3. … A majority of the full membership of the board of directors shall constitute a quorum and … .

Revised Law

Sec. 1043.059. APPOINTMENT AND RECRUITMENT OF STAFF AND EMPLOYEES. (a) The board may employ a general manager, attorney, bookkeeper, and architect.

(b) The board may spend district money to recruit physicians, nurses, or other trained medical personnel to the hospital staff.

(1) is enrolled and in good standing in an accredited hospital, school, or college; and

(2) contractually agrees to serve as a district employee on terms prescribed by the board.

(d) Subject to Subsection (e), the board may provide financial inducements, including income subsidies or guarantees and reimbursement of relocation expenses, to a full-time medical intern or resident physician serving in a hospital who contractually agrees to:

(1) reside and practice in Hopkins County; and

(2) provide care and treatment to its needy residents.

(e) The board may offer financial inducements only to attract qualified physicians who possess medical expertise that is not available in the county. (Acts 57th Leg., 1st C.S., Ch. 43, Secs. 8 (part), 8A.)

Source Law

Sec. 8. The board of directors of the district … may employ a general manager, attorney, bookkeeper and architect… .

Sec. 8A. (a) The board may spend district funds to recruit physicians, nurses, or other trained medical personnel to the hospital staff.

(b) The board may agree to pay all or part of the tuition or other costs of a medical technician or nursing student who is enrolled and in good standing in an accredited hospital, school, or college and who contractually agrees to serve as a district employee on terms prescribed by the board.

(c) The board may provide financial inducements to a full-time medical intern or resident physician serving in a hospital who contractually agrees to reside and practice in Hopkins County and to provide care and treatment to its needy residents. The financial inducements may include income subsidies or guarantees and reimbursement of relocation expenses. The board may offer the financial inducements only to attract qualified physicians who possess medical expertise that is not available in the county.

Revised Law

Sec. 1043.060. MAINTENANCE OF RECORDS; PUBLIC INSPECTION. Except as provided by Section 1043.054, all district records, including books, accounts, notices, minutes, and all other matters of the district and the operation of its facilities, shall be:

(1) maintained at the district office; and

(2) open to public inspection at the district office at all reasonable hours. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 8 (part).)

Source Law

Sec. 8. … All books, records, accounts, notices and minutes and all other matters of the district and the operation of its facilities shall, except as herein provided, be maintained at the office of the district and there be open to public inspection at all reasonable hours… .

Revisor's Note

Section 8, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, states that records shall be maintained at the district office "except as herein provided." For the convenience of the reader, the revised law substitutes a reference to Section 1043.054, which is the only exception provided in Chapter 43.

Revised Law

Sec. 1043.061. SEAL. The board may adopt a seal for the district. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 8 (part).)

Source Law

Sec. 8. The board of directors of the district … shall have the power to adopt a seal for such district; and … .

Revisor's Note

(End of Subchapter)

Section 3, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, states that a person must file a ballot application with the board secretary to be a candidate for director and prescribes a deadline for filing the application. The revised law omits the requirement to file the application with the board secretary because it duplicates Sections 144.003 and 144.004, Election Code. The revised law omits the filing deadline because it is superseded by Section 144.005, Election Code. Section 1.002, Election Code, provides that the Election Code applies to all elections held in this state. The omitted law reads:

Sec. 3. … Any person desiring his name to be printed on the ballot as a candidate for director shall file an application with the secretary of the board of directors of the district. Such application shall be filed with such secretary at least forty-five (45) days prior to the date of election.

[Sections 1043.062-1043.100 reserved for expansion]

SUBCHAPTER C. POWERS AND DUTIES

Revised Law

Sec. 1043.101. DISTRICT RESPONSIBILITY. The district has full responsibility for providing medical and hospital care for the district's needy and indigent residents. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 13 (part).)

Source Law

Sec. 13. … such hospital district shall be deemed to have assumed full responsibility for the furnishing of medical and hospital care for the needy and indigent persons residing in said hospital district from the date that taxes are collected for the hospital district… .

Revisor's Note

Section 13, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that the district "shall be deemed to have assumed" full responsibility for providing medical and hospital care for the district's needy and indigent residents. The revised law substitutes "has" for the quoted language because the duty to assume the responsibility is executed. The revised law omits "from the date that taxes are collected for the hospital district" as executed.

Revised Law

Sec. 1043.102. RESTRICTION ON COUNTY OR MUNICIPALITY TAXATION. Hopkins County or a municipality in Hopkins County may not impose a tax for hospital purposes. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 13 (part).)

Source Law

Sec. 13. Except as herein provided, Hopkins County once constituted a hospital district, and no city therein, shall thereafter levy any tax for hospital purposes; and … .

Revisor's Note

(1) Section 13, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides, "[e]xcept as herein provided," certain political subdivisions may not levy a tax for hospital purposes. The only provision that authorizes a city or county to levy a tax is Section 15. Since Section 15 is omitted from the revised law as explained in Revisor's Note (4), the revised law omits "[e]xcept as herein provided" as unnecessary. In addition, throughout this chapter the revised law substitutes "impose" for "levy" because, in this context, the terms are synonymous and "impose" is more commonly used.

(2) Section 13, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, refers to "Hopkins County once constituted a hospital district, and no city therein." The revised law substitutes "municipality" for "city" to conform to the terminology used in the Local Government Code.

(3) Section 6, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, prohibits Hopkins County or a city located in Hopkins County from selling bonds that were authorized to provide hospital facilities but were not sold on the date the district was created. The revised law omits that provision as executed. The omitted law reads:

Sec. 6. … If Hopkins County or any city within such county has voted bonds to provide hospital facilities, but such bonds have not been sold and delivered at the date of the creation of the hospital district, the authority for such bonds shall be canceled and they shall not be sold.

(4) Section 15, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, authorizes Hopkins County to impose an additional tax to assist in the operation of the district and authorizes the county and district to contract for the provision of medical care to the county's needy residents. The revised law omits those provisions as unconstitutional under Section 11, Article IX, Texas Constitution, which prohibits a municipality or political subdivision in a hospital district from imposing taxes for medical or hospital care for needy individuals after creation of the district and provides that the hospital district's tax must be "sufficient to discharge obligations, liabilities, and responsibilities, and to maintain and operate the hospital system." The omitted law reads:

Sec. 15. Hopkins County may levy and collect a tax of Ten Cents (10¢) on the One Hundred Dollar valuation of property in such county to aid in the operation of the district or the payment of the debts of such district, such tax to be in addition to other taxes permitted by the Constitution of Texas to be levied, all as provided in the aforesaid constitutional provision authorizing the creation of hospital districts for Ochiltree, Hansford, Castro, and Hopkins counties; and such county and hospital district may contract whereby the district will assume all obligations of the county in respect to the care of indigents within such county in exchange for such funds of the county. No such contract shall extend for a period in excess of five (5) years, but may be renewed for a similar term or terms upon conditions satisfactory to the contracting parties, and during the term that the hospital district assumes all responsibilities, obligations and liabilities of the county, no tax may be levied by the county other than as specified herein.

Revised Law

Sec. 1043.103. MANAGEMENT AND CONTROL. The management and control of the district is vested in the board. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 4 (part).)

Source Law

Sec. 4. The management and control of such hospital district created pursuant to the provisions of this Act is hereby vested in the board of directors of the district … .

Revised Law

Sec. 1043.104. HOSPITAL SYSTEM. The district may provide for the establishment of a hospital or hospital system to provide medical and hospital care to the district's needy residents. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 2 (part).)

Source Law

Sec. 2. … [hospital district] … may provide for the establishment of a hospital or hospital system to furnish medical and hospital care to needy persons residing in said hospital district; … .

Revised Law

Sec. 1043.105. RULES. (a) The board may adopt rules governing the operation of the district, including district facilities.

(b) On approval by the board, the rules may be published in booklet form at district expense and made available to any taxpayer on request. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 8 (part).)

Source Law

Sec. 8. … The board of directors is specifically empowered to adopt rules and regulations governing the operation of the district and its facilities which rules and regulations shall supplement but shall not contravene any of the provisions of this Act. Such rules and regulations may, upon approval of the board of directors, be published in booklet or pamphlet form at the expense of the district and may be made available to any taxpayer upon request.

Revisor's Note

(1) Section 8, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, refers to "rules and regulations." The revised law omits the references to "regulations" because under Section 311.005(5), Government Code (Code Construction Act), a rule is defined to include a regulation.

(2) Section 8, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that the board may adopt rules that "shall supplement but shall not contravene any of the provisions of this Act." The revised law omits the quoted language because, under established principles of law, the board is not authorized to take any action contrary to the laws of this state.

(3) Section 8, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, refers to publishing rules in "booklet or pamphlet form." The revised law omits "pamphlet" because, in context, the meaning of "pamphlet" is included in the meaning of "booklet."

Revised Law

Sec. 1043.106. PURCHASING AND ACCOUNTING PROCEDURES. (a) The board may prescribe the method and manner of making purchases and expenditures by and for the district.

(b) The board shall prescribe:

(1) all accounting and control procedures; and

(2) the method of purchasing necessary supplies, materials, and equipment. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 8 (part).)

Source Law

Sec. 8. The board of directors of the district shall have the power to prescribe the method and manner of making purchases and expenditures by and for the hospital district, and also shall prescribe all accounting and control procedures; the method of purchasing necessary supplies, materials and equipment; and … .

Revised Law

Sec. 1043.107. DISTRICT PROPERTY, FACILITIES, AND EQUIPMENT. (a) The board shall determine the type, number, and location, either inside or outside the district, of facilities required to maintain an adequate hospital system and ancillary health care system and the type of equipment necessary for hospital care and ancillary health care services, including:

(1) domiciliary care and treatment of sick or injured patients;

(2) geriatric services;

(3) outpatient clinics;

(4) rural health clinics;

(5) convalescent home facilities;

(6) physician's offices;

(7) home health services;

(8) durable medical equipment;

(9) long-term care;

(10) skilled nursing care;

(11) intermediate nursing care;

(12) hospice care;

(13) ambulatory surgery centers;

(14) urgent care facilities;

(15) operation of a mobile emergency medical service;

(16) extended care facilities;

(17) assisted living facilities; and

(18) any other facility or equipment the board considers necessary for the delivery of hospital, medical, and ancillary health care services.

(b) The board may:

(1) acquire by lease, purchase, or lease to purchase property, including facilities, supplies, and equipment, for the district for use in the hospital system and ancillary health care system; and

(2) mortgage or pledge the property as security for the payment of the purchase price.

(c) The board may lease, sell, or otherwise dispose of all or part of the district's property for the district, including facilities, supplies, or equipment, to a public or private entity, but only to the extent necessary to maintain an adequate hospital system for the residents of Hopkins County. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 6C.)

Source Law

Sec. 6C. The board has complete discretion to determine the type, number, and location, either inside or outside the district, of facilities required to establish and maintain an adequate hospital system and ancillary health care system, and the type of equipment necessary for hospital care and ancillary health care, including domiciliary care and treatment of sick or injured patients, geriatric services, outpatient clinics, rural health clinics, convalescent home facilities, physician's offices, home health services, durable medical equipment, long-term care, skilled nursing care, intermediate nursing care, hospice care, ambulatory surgery centers, urgent care facilities, operation of a mobile emergency medical service, extended care facilities, assisted living facilities, and any other facility or equipment the board considers necessary for the delivery of hospital, medical, and ancillary health care services. The board may acquire by lease, purchase, or lease to purchase property, facilities, supplies, and equipment for the district for use in the hospital system and ancillary health care system and may mortgage or pledge the property, facilities, supplies, or equipment acquired as security for the payment of the purchase price. The board, on behalf of the district, may lease, sell, or otherwise dispose of the district's property, all or part of the hospital facilities, ancillary facilities, other facilities, supplies, or equipment to a public or private entity, but only to the extent necessary to maintain an adequate hospital system for the residents of Hopkins County.

Revisor's Note

Section 6C, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, requires the board to determine the facilities and buildings required to "establish and maintain" the hospital system. The revised law omits the references to establishing the hospital system as executed.

Revised Law

Sec. 1043.108. PROPERTY, FACILITIES, AND EQUIPMENT FOR STAFF PHYSICIANS. (a) The board shall determine the type, number, and location of buildings required to establish and maintain office facilities for staff physicians as necessary to provide adequate medical care.

(b) The board may:

(1) acquire property, including equipment, and construct facilities for the district for use by staff physicians; and

(2) mortgage or pledge the property or facilities as security for the payment of the purchase or construction price.

(1) lease the office facilities and equipment to staff physicians; and

(2) sell or otherwise dispose of the property, including facilities and equipment. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 6A.)

Source Law

Sec. 6A. (a) The board shall determine the type, number, and location of buildings required to establish and maintain office facilities for staff physicians as necessary to provide adequate medical care.

(b) The board may acquire property and equipment and construct facilities for the district for use by staff physicians and may mortgage or pledge the property, facilities, or equipment acquired as security for the payment of the purchase or construction price.

(c) The board, on behalf of the district, may lease the office facilities and equipment to staff physicians or may sell or otherwise dispose of the property, facilities, or equipment.

Revised Law

Sec. 1043.109. EMINENT DOMAIN. (a) The district may exercise the power of eminent domain to acquire a fee simple or other interest in any type of property, real, personal, or mixed, located in district territory, if the interest is necessary or convenient for the district to exercise a right, power, privilege, or function conferred on the district by this chapter.

(b) The district must exercise the power of eminent domain in the manner provided by Chapter 21, Property Code, except the district is not required to deposit in the trial court money or a bond as provided by Section 21.021(a), Property Code.

(1) pay in advance or provide a bond or other security for costs in the trial court;

(2) provide a bond for the issuance of a temporary restraining order or a temporary injunction; or

(3) provide a bond for costs or a supersedeas bond on an appeal or writ of error. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 10.)

Source Law

Sec. 10. The hospital district organized in pursuance of this Act shall have the right and power of eminent domain for the purpose of acquiring by condemnation any and all property of any kind or character, real, personal or mixed, or any interest therein, including outright ownership of such property in fee simple absolute, within the boundaries of the said district, necessary or convenient to the exercise of the rights, powers, privileges and functions conferred upon it by this Act, in the manner provided by General Law with respect to condemnation; provided that the said district shall not be required to make deposits in the registry of the trial court of the sum required by paragraph Number 2 in Article 3268, Vernon's Civil Statutes, 1925, or to make the bond required therein. In condemnation proceedings being prosecuted by the said district, the district shall not be required to pay in advance or to give bond or other security for costs in the trial court, nor to give any bond otherwise required for the issuance of a temporary restraining order or a temporary injunction relating to a condemnation proceeding, nor to give bond for costs or for supersedeas on any appeal or writ of error proceeding to any court of civil appeals, or to the Supreme Court.

Revisor's Note

(1) Section 10, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that the district has the "right and power of eminent domain for the purpose of acquiring [property] by condemnation." The revised law substitutes for the quoted language "may exercise the power of eminent domain to acquire [property]" because the phrases have the same meaning, and the latter phrase is consistent with modern usage in laws relating to eminent domain.

(2) Section 10, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that the district must exercise the power of eminent domain in the manner provided by "General Law with respect to condemnation." The revised law substitutes for the quoted language a reference to Chapter 21, Property Code, because that is the general law governing eminent domain.

(3) Section 10, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, refers to "paragraph Number 2 in Article 3268, Vernon's Civil Statutes, 1925." That statute was codified in 1983 as Section 21.021(a), Property Code. The revised law is drafted accordingly.

(4) Section 10, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that the district is not required to provide bond on any appeal or writ of error proceedings to "any court of civil appeals, or to the Supreme Court." The revised law omits the references to the courts because those are the only courts to which the district may appeal or apply for a writ of error.

Revised Law

Sec. 1043.110. GIFTS AND ENDOWMENTS. The board may accept for the district a gift or endowment to be held in trust and administered by the board for any nonprofit purpose and under the directions, limitations, or other provisions prescribed in writing by the donor that are not inconsistent with the proper management and objectives of the district. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 16.)

Source Law

Sec. 16. Said board of directors of the hospital district is authorized on behalf of said hospital district to accept donations, gifts and endowments for the hospital district to be held in trust and administered by the board of directors for any nonprofit purpose and under such directions, limitations, and provisions as may be prescribed in writing by donor, not inconsistent with proper management and objects of hospital district.

Revisor's Note

Section 16, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, refers to "donations" and "gifts." The revised law omits the reference to "donations" because "donations" is included in the meaning of "gifts."

Revised Law

Sec. 1043.111. JOINT OWNERSHIP ARRANGEMENT. (a) The board may enter into a joint ownership arrangement for the district with one or more public or private entities for:

(1) the provision of management or operating services; and

(2) the ownership of all or part of real property, facilities, equipment, or supplies.

(b) Before the board enters into the arrangement, the board must determine that the arrangement is:

(1) in the district's best interest; and

(2) for a public purpose of the district. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 7A.)

Source Law

Sec. 7A. (a) The board, on behalf of the district, may enter into a joint ownership arrangement with one or more public or private entities for the:

(1) provision of management or operating services; and

(2) ownership of all or part of real property, facilities, equipment, or supplies.

(b) The board must determine the arrangement is in the district's best interest and is for a public purpose of the district before the board enters into an arrangement under this section.

Revised Law

Sec. 1043.112. PAYMENT FOR TREATMENT; PROCEDURES. (a) When a patient is admitted to a district facility, the board shall have an inquiry made into the circumstances of:

(1) the patient; and

(2) the patient's relatives who are legally liable for the patient's support.

(b) The district without charge shall provide to a patient who resides in the district the care and treatment that the patient or a relative of the patient who is legally responsible for the patient's support cannot pay.

(c) If it is determined that the patient or those relatives are liable to pay for all or part of the costs of the patient's care and treatment, the patient or those relatives shall be ordered to pay to the district's treasurer a specified amount each week for the patient's support. The amount ordered must be proportionate to the person's financial ability and may not exceed the actual per capita cost of maintenance.

(d) The district may collect the amount from the patient's estate, or from any relative who is legally liable for the patient's support, in the manner provided by law for the collection of expenses of the last illness of a deceased person.

(e) If there is a dispute as to the ability to pay, or doubt in the mind of the district's designated agent, the board shall hold a hearing and, after calling witnesses, shall:

(1) resolve the dispute or doubt; and

(2) issue an appropriate order.

(f) Either party to the dispute may appeal the order to the district court. (Acts 57th Leg., 1st C.S., Ch. 43, Secs. 14(a), (c), (d), (e), (f).)

Source Law

Sec. 14. (a) The district shall, without charge, supply to a patient residing in the district the care and treatment that the patient or a relative of the patient who is legally responsible for the patient's support cannot pay.

(c) Whenever a patient has been admitted to the facilities of the hospital district, the directors shall cause inquiry to be made as to his circumstances, and of the relatives of such patient legally liable for his support.

(d) If he finds that such patient or said relatives are liable to pay for his care and treatment in whole or in part, an order shall be made directing such patient, or said relatives, to pay to the treasurer of the hospital district for the support of such patient a specified sum per week, in proportion to their financial ability, but such sum shall not exceed the actual per capita cost of maintenance.

(e) The district shall have power and authority to collect such sum from the estate of the patient, or his relatives legally liable for his support, in the manner provided by law for the collection of expenses of the last illness of a deceased person.

(f) Should there be a dispute as to the ability to pay, or doubt in the mind of the person designated as aforesaid, the district's directors shall hear and determine same, after calling witnesses, and shall make such order as may be proper, from which appeal shall lie to the district court by either party to the dispute.

Revisor's Note

Section 14(b), Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, requires the district to adopt an application procedure for assistance eligibility. The revised law omits the provision because it duplicates Sections 61.053(a) and (b), Health and Safety Code, which apply to the district and detail the application procedure. The omitted law reads:

(b) Not later than the beginning of each operating year, the district shall adopt an application procedure to determine eligibility for assistance, as provided by Section 61.053, Health and Safety Code.

Revised Law

Sec. 1043.113. NONPROFIT CORPORATION. (a) The district may become a member of a nonprofit corporation or enter into an agreement with a nonprofit corporation to serve the purposes of this chapter. Under an agreement with a nonprofit corporation, the district may require that:

(1) the nonprofit corporation grant the district the power to appoint one or more members of the corporation's board of directors;

(2) the nonprofit corporation obtain the district's consent before changing the corporation's articles of incorporation or bylaws or before taking other action; and

(3) the district receive all or part of the net assets of the nonprofit corporation on the corporation's dissolution, merger, or consolidation.

(b) The district is not liable for any debt, obligation, or other liability of the nonprofit corporation.

(c) This section does not affect the district's authority to make payments to or otherwise provide money to the nonprofit corporation. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 6B.)

Source Law

Sec. 6B. (a) The district may become a member of a nonprofit corporation or enter into an agreement with a nonprofit corporation to serve the purposes of this Act. Under an agreement with a nonprofit corporation, the district may require that:

(1) the nonprofit corporation grant the district the power to appoint one or more members of the board of directors of the nonprofit corporation;

(2) the nonprofit corporation obtain the consent of the district before making changes in the corporation's articles of incorporation or bylaws or before taking other action; and

(3) the district receive all or a portion of the net assets of the nonprofit corporation on the corporation's dissolution, merger, or consolidation.

(b) The hospital district is not liable for any debt, obligation, or other liability of the nonprofit corporation.

(c) This section does not affect the district's authority to make payments to or otherwise provide funds to the nonprofit corporation.

Revised Law

Sec. 1043.114. AUTHORITY TO SUE AND BE SUED. As a governmental agency, the district may sue and be sued in its own name in any court of this state. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 18 (part).)

Source Law

Sec. 18. [The hospital district created under the provisions of this Act] … as a governmental agency may sue and be sued in any and all courts in this State in the name of such district.

Revisor's Note

(End of Subchapter)

Section 12, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides authority for the "State Board of Health or any State Board of Charities (or Public Welfare)" to inspect district facilities and records. The revised law omits Section 12 because various state laws, including Chapters 222 and 241, Health and Safety Code, provide the necessary inspection authority to appropriate state agencies. The omitted law reads:

Sec. 12. The hospital district established or maintained under provisions of this Act shall be subject to inspection by any duly authorized representative of the State Board of Health or any State Board of Charities (or Public Welfare) that may hereafter be created, and resident officers shall admit such representatives into all hospital district facilities and give them access on demand to all records, reports, books, papers and accounts pertaining to the hospital district.

[Sections 1043.115-1043.150 reserved for expansion]

SUBCHAPTER D. GENERAL FINANCIAL PROVISIONS

Revised Law

Sec. 1043.151. BUDGET. The board annually shall require a budget to be prepared for the next fiscal year that includes:

(1) proposed expenditures and disbursements;

(2) estimated receipts and collections; and

(3) the amount of taxes required to be imposed for the year. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 9 (part).)

Source Law

Sec. 9. … The board of directors shall each year cause a budget to be prepared showing the proposed expenditures and disbursements and the estimated receipts and collections for the following fiscal year and … . The proposed budget shall also show the amount of taxes required to be levied and collected during such fiscal year and … .

Revisor's Note

Section 9, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, refers to the levy and collection of a tax. The revised law substitutes "imposed" for "levied and collected" because "imposed" is the term generally used in Title 1, Tax Code, and includes the levying and collection of an ad valorem tax.

Revised Law

Sec. 1043.152. PROPOSED BUDGET: NOTICE AND HEARING. (a) The board shall hold a public hearing on the proposed budget.

(b) Notice of the hearing must be published at least once in a newspaper of general circulation in Hopkins County not later than the 10th day before the date of the hearing.

(1) appear at the time and place designated in the notice; and

(2) be heard regarding any item included in the proposed budget. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 9 (part).)

Source Law

Sec. 9. … [The board of directors] … shall hold a public hearing on the proposed budget after publication of a notice of hearing in a newspaper of general circulation in the county at least once not less than ten (10) days prior to the date set for the hearing. Any person who is a taxpayer of the district shall have the right to appear at the time and place designated in the notice and be heard with reference to any item shown in the proposed budget. …

Revised Law

Sec. 1043.153. FISCAL YEAR. The district operates on a fiscal year that begins on October 1 and ends on September 30. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 9 (part).)

Source Law

Sec. 9. The fiscal year of the hospital district authorized to be established by the provisions hereof shall commence on October 1st of each year and end on the thirtieth (30th) day of September of the following year. …

Revised Law

Sec. 1043.154. ANNUAL AUDIT. (a) The board annually shall have an independent audit made of the district's books and records for the fiscal year.

(b) Not later than December 31 each year, the audit shall be filed:

(1) with the comptroller; and

(2) at the district office. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 9 (part).)

Source Law

Sec. 9. … The district directors shall cause an annual independent audit to be made of the books and records of the district, such audit to be made covering such fiscal year, and the same shall be filed with the Comptroller of Public Accounts of the State of Texas and at the office of the district not later than December 31st of each year. …

Revisor's Note

Section 9, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, refers to "the Comptroller of Public Accounts of the State of Texas." The revised law substitutes "comptroller" for the quoted language because Section 403.001, Government Code, defines "comptroller" in any state statute to mean the comptroller of public accounts of the State of Texas.

Revised Law

Sec. 1043.155. DEPOSITORY OR TREASURER. (a) The board by resolution shall designate a bank or banks in Hopkins County as the district's depository or treasurer. A designated bank serves for two years and until a successor is designated.

(b) All income received by the district shall be deposited with the district depository.

(c) All district money shall be secured in the manner provided for securing county funds. (Acts 57th Leg., 1st C.S., Ch. 43, Secs. 5(a) (part), 11.)

Source Law

Sec. 5. (a) … [shall be deposited in the district depository] … . All other income of the hospital district shall be deposited in like manner with the district depository. …

Sec. 11. Within thirty (30) days after appointment and qualification of the board of directors of the hospital district, the said directors shall by resolution designate a bank or banks within the county in which the district is located as the district's depository or treasurer and all funds of the district shall be secured in the manner now provided for the security of county funds. The depository shall serve for a period of two (2) years and until a successor has been named.

Revisor's Note

Section 11, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, requires the board to select a depository "[w]ithin thirty (30) days after appointment and qualification of the board of directors of a hospital district." The revised law omits the quoted language as executed.

Revised Law

Sec. 1043.156. AUTHORITY TO BORROW MONEY; SECURITY. (a) If the board declares that money is not available to meet authorized district obligations, the board may:

(1) by majority vote borrow money to satisfy the obligations in an amount not to exceed, at any one time in the aggregate, 10 percent of the annual district operational expenses for the prior fiscal year; and

(2) by unanimous vote borrow additional money if the obligations exceed the amount described by Subdivision (1).

(b) To secure a loan, the board may pledge:

(1) district revenue that is not pledged to pay the district's bonded indebtedness; or

(2) a district tax to be imposed by the district in the next 12-month period that is not pledged to pay the principal of or interest on district bonds.

(c) A loan for which taxes are pledged must mature and be paid not later than the first anniversary of the date the loan is made.

(d) The board may not spend money obtained from a loan under this section for any purpose other than:

(1) the purpose for which the board declared an emergency; and

(2) if district taxes are pledged to pay the loan, the purposes for which the pledged taxes were imposed. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 8B.)

Source Law

Sec. 8B. (a) If the hospital board of directors declares that funds are not currently available to meet lawfully authorized obligations of the district, the board may, by majority vote, borrow money to satisfy those obligations in an amount not to exceed, at any one time in the aggregate, 10 percent of the annual operational expenses of the district for the prior fiscal year and, in addition, the board may, by unanimous vote, borrow money to satisfy obligations that exceed 10 percent of annual operating expenses of the district for the prior fiscal year.

(b) To secure a loan, the board may pledge:

(1) revenues of the district that are not pledged to pay bonded indebtedness of the district; or

(2) district taxes to be levied by the district in the next 12-month period that are not pledged to pay the principal of or interest on district bonds.

(c) A loan for which taxes are pledged must mature and be paid not later than the first anniversary of the date on which the loan is made.

(d) The board may not spend money obtained from a loan under this section for any purpose other than the purpose declared by the board and, if taxes are pledged to pay the loan, for any purpose other than the purposes for which the pledged taxes were levied.

[Sections 1043.157-1043.200 reserved for expansion]

SUBCHAPTER E. BONDS

Revised Law

Sec. 1043.201. GENERAL OBLIGATION BONDS. The board may issue and sell general obligation bonds in the name and on the faith and credit of the district for any purpose relating to:

(1) the purchase, construction, acquisition, repair, or renovation of buildings or improvements, including medical facilities; and

(2) equipping buildings or improvements for hospital or medical purposes. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 6 (part).)

Source Law

Sec. 6. The board of directors shall have the power and authority to issue and sell as the obligations of the hospital district, and in the name and upon the faith and credit of the hospital district, bonds for the purchase, construction, acquisition, repair or renovation of buildings and improvements, including medical facilities, and equipping the same for hospital or medical purposes and for any or all of such purposes; … .

Revisor's Note

Section 6, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that the board may issue and sell bonds in the name and on the faith and credit of the district. Because the type of bonds described by Section 6 are known as "general obligation bonds," the revised law is drafted accordingly.

Revised Law

Sec. 1043.202. TAX TO PAY GENERAL OBLIGATION BONDS. (a) The board shall impose an ad valorem tax at a rate sufficient to create an interest and sinking fund to pay the principal of and interest on general obligation bonds issued by the district under Section 1043.201 as the bonds mature.

(b) The tax required by this section together with any other ad valorem tax the district imposes may not in any year exceed 25 cents on each $100 valuation of all taxable property in the district. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 6 (part).)

Source Law

Sec. 6. … provided, that a sufficient tax shall be levied to create an interest and sinking fund to pay the interest and principal as same matures, provided said tax together with any other taxes levied for said district shall not exceed twenty-five cents (25¢) in any one (1) year. …

Revisor's Note

Section 6, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, requires the district to levy a tax to pay the principal of and interest on bonds. The revised law specifies that the tax is an "ad valorem" tax because it is clear from the source law that the tax is a property tax, and "ad valorem" is the term most commonly used to refer to a property tax.

Revised Law

Sec. 1043.203. GENERAL OBLIGATION BOND ELECTION. (a) The district may issue general obligation bonds only if the bonds are authorized by a majority of the district voters voting at an election held for that purpose.

(b) The board may order the election on its own motion.

(1) the location of the polling places;

(2) the presiding election officers;

(3) the purpose of the bond issuance;

(4) the amount of the bonds to be authorized;

(5) the maximum interest rate of the bonds; and

(6) the maximum maturity of the bonds.

(d) Notice of a bond election shall be given by publishing a substantial copy of the order calling the election in a newspaper of general circulation in Hopkins County once a week for two consecutive weeks before the date of the election. The first publication must occur at least 14 days before the date of the election. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 6 (part).)

Source Law

Sec. 6. … No bonds shall be issued by the hospital district … until authorized by a majority vote of the legally qualified property taxpaying electors, residing in the hospital district, voting at an election called and held for such purpose. Such election may be called by the board of directors of its own motion, shall specify the place or places where the election shall be held, the presiding officers thereof, the purpose for which the bonds are to be issued, the amount thereof, maximum interest rate (not to exceed the rate provided by Chapter 3, Acts of the 61st Legislature, Regular Session, 1969 (Article 717k-2, Vernon's Texas Civil Statutes)) and the maximum maturity date of such bonds … . Notice of election shall be given by publishing a substantial copy of the order calling the election in a newspaper of general circulation in such county once a week for two (2) consecutive weeks prior to the date of election, the date of the first publication being at least fourteen (14) full days prior to the date set for the election… .

Revisor's Note

(1) Section 6, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, refers to the "legally qualified … electors" of the district. The revised law omits the quoted language because Chapter 11, Election Code, governs eligibility to vote in an election in this state and allows only "[legally] qualified" voters who are residents of the territory covered by the election to vote in an election. The revised law omits "legally" because Section 11.001, Election Code, provides that, to be eligible to vote, a person must satisfy all requirements for voting required by law for the particular election. Finally, the revised law substitutes "voter" for "elector" because the former is the term used in the Election Code.

(2) Section 6, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, refers to "property taxpaying" electors. The revised law omits the quoted language because in Hill v. Stone, 421 U.S. 289, 95 S. Ct. 1637 (1975), the United States Supreme Court determined that property ownership as a qualification for voting is an unconstitutional denial of equal protection.

(3) Section 6, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, refers to an election "called and held." The revised law omits the reference to "calling" an election because, in this context, "calling" an election is included in the meaning of "holding" an election. Under Chapter 3, Election Code, all elections must be ordered (called) before they may be held.

(4) Section 6, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that the ballot proposition must include the maximum interest rate "(not to exceed the rate provided by Chapter 3, Acts of the 61st Legislature, Regular Session, 1969 (Article 717k-2, Vernon's Texas Civil Statutes))." The revised law omits that reference because the maximum interest rate noted in Chapter 3 was revised in 1999 as Section 1204.006, Government Code, and Section 1204.006 applies to the district under Section 1204.001, Government Code.

(5) Section 6, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, requires the district to pay the costs of elections. The revised law omits the provision because it duplicates Section 1.014, Election Code, applicable to the district under Section 1.002 of that code. The omitted law reads:

Sec. 6. … The costs of such election shall be paid by the hospital district. …

Revised Law

Sec. 1043.204. MATURITY OF GENERAL OBLIGATION BONDS. District general obligation bonds must mature not later than 40 years after the date of issuance. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 6 (part).)

Source Law

Sec. 6. … [the maximum maturity date of such bonds] (not to exceed forty (40) years from their date of issuance). …

Revised Law

Sec. 1043.205. EXECUTION OF GENERAL OBLIGATION BONDS. (a) The board president shall execute the general obligation bonds in the district's name.

(b) The board secretary shall countersign the bonds. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 6 (part).)

Source Law

Sec. 6. … Such bonds shall be executed in the name of the hospital district and on its behalf by the president of the board of directors, and countersigned by the secretary of the board of directors, and … .

Revisor's Note

Section 6, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that district bonds are subject to the law governing counties that relates to bond approval by the attorney general and registration of the bonds by the comptroller. Section 6 also provides that after approval the bonds are "incontestable for any cause." The revised law omits those provisions as superseded by Chapter 1202, Government Code (enacted as Article 3, Chapter 53, Acts of the 70th Legislature, 2nd Called Session, 1987). Section 1202.003(a), Government Code, requires bonds to be submitted to the attorney general. Section 1202.003(b), Government Code, provides for approval of the bonds by the attorney general and requires the attorney general to submit the approved bonds to the comptroller for registration. Section 1202.005, Government Code, requires registration of the bonds by the comptroller. Section 1202.006, Government Code, provides that after approval and registration the bonds are incontestable and binding obligations. Chapter 1202, Government Code, applies to district bonds by application of Section 1202.001, Government Code. The omitted law reads:

Sec. 6. … [Such bonds] … shall be subject to the same requirements in the matter of approval thereof by the Attorney General of the State of Texas and the registration thereof by the Comptroller of Public Accounts of the State of Texas as are by law provided for such approval and registration of bonds of such county. Upon the approval of such bonds by the Attorney General of Texas the same shall be incontestable for any cause… .

Revised Law

Sec. 1043.206. REVENUE BONDS. (a) The board may issue revenue bonds to:

(1) purchase, construct, acquire, repair, or renovate buildings or improvements, including necessary equipment and furnishings, for hospital purposes and the hospital system;

(2) acquire sites to be used for hospital purposes; or

(3) acquire and operate a mobile emergency medical or air ambulance service to assist the district in carrying out its hospital purpose.

(b) The bonds may be secured by a mortgage or deed of trust lien on all or part of district property.

(c) The bonds must be issued in the manner provided by Sections 264.042, 264.043, and 264.046-264.049, Health and Safety Code, for issuance of revenue bonds by a county hospital authority. (Acts 57th Leg., 1st C.S., Ch. 43, Secs. 6D(a), (b) (part), (c).)

Source Law

Sec. 6D. (a) The district may issue revenue bonds to:

(1) purchase, construct, acquire, repair, or renovate buildings or improvements for hospital purposes, including necessary equipment and furnishings, and the hospital system;

(2) acquire sites to be used for hospital purposes; or

(3) acquire and operate a mobile emergency medical or air ambulance service to assist the district in carrying out its hospital purpose.

(b) The bonds may be secured by a mortgage or deed of trust lien on all or part of district property… .

(c) The bonds must be issued in the manner provided by Sections 264.042, 264.043, 264.046, 264.047, 264.048, and 264.049, Health and Safety Code, for issuance of revenue bonds by county hospital authorities.

Revised Law

Sec. 1043.207. REFUNDING BONDS. (a) The board may, without an election, issue refunding bonds to refund outstanding bonds issued or assumed by the district.

(b) A refunding bond may be:

(1) sold, with the proceeds of the refunding bond applied to the payment of the bonds to be refunded; or

(2) exchanged wholly or partly for not less than a similar amount of outstanding bonds and the unpaid matured interest on the bonds. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 6 (part).)

Source Law

Sec. 6. … [No bonds shall be issued by the hospital district] (except refunding bonds) [until authorized by a majority vote of the legally qualified property taxpaying electors] … . In the manner hereinabove provided, the bonds of such hospital district may, without the necessity of any election therefor, be issued for the purpose of refunding and paying off any bonded indebtedness theretofore assumed by such hospital district and any bonds theretofore issued by such hospital districts; such refunding bonds may be sold and the proceeds thereof applied to the payment of any such outstanding bonds or may be exchanged in whole or in part for not less than a like amount of said outstanding bonds and interest matured thereon, but unpaid; … .

Revisor's Note

Section 6, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, limits the interest rate for refunding bonds and other bonds issued by the district. The revised law omits the part of Section 6 that relates to interest rates as impliedly repealed by Section 2(a), Chapter 3, Acts of the 61st Legislature, Regular Session, 1969 (Article 717k-2, Vernon's Texas Civil Statutes), which was revised in 1999 as Section 1204.006(a), Government Code. Section 1204.006(a) permits a public agency, including a hospital district, to issue bonds at a net effective interest rate not to exceed 15 percent and applies to district bonds by application of Section 1204.001, Government Code. The omitted law reads:

Sec. 6. … provided the average interest cost per annum on the refunding bonds, computed in accordance with recognized standard bond interest cost tables, shall not exceed the average interest cost per annum so computed, upon the bonds to be discharged out of the proceeds of the refunding bonds, unless the total interest cost on the refunding bonds, computed to their respective maturity dates, is less than the total interest cost so computed on the bonds to be discharged out of such proceeds. In the foregoing computations, any premium or premiums required to be paid upon the bonds to be refunded as a condition to payment in advance of their stated maturity dates shall be taken into account as an addition to the net interest cost to the hospital district of the refunding bonds… .

Revised Law

Sec. 1043.208. BONDS EXEMPT FROM TAXATION. The following are exempt from taxation by this state or a political subdivision of this state:

(1) bonds issued by the district;

(2) any transaction relating to the bonds; and

(3) profits made in the sale of the bonds. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 6D(d) (part).)

Source Law

(d) … bonds issued by the district, transactions relating to the bonds, and profits made in the sale of the bonds are free from taxation by the state or any city, county, special district, or other political subdivision of the state.

Revisor's Note

Section 6D(d), Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, refers to "any city, county, special district, or other political subdivision of the state." The revised law omits "city," "county," and "special district" because those terms are included in the meaning of "political subdivision of the state."

Revisor's Note

(End of Subchapter)

(1) Section 17, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that district bonds are authorized investments for certain entities. The revised law omits the provision as unnecessary. As to several of the entities listed, Section 17 has been superseded and impliedly repealed. Investments in securities by banks are regulated by Section 34.101, Finance Code (enacted in 1995 as Section 5.101, Texas Banking Act (Article 342-5.101, Vernon's Texas Civil Statutes)). Investments in securities by savings banks are regulated by Section 93.001(c)(10), Finance Code (enacted in 1993 as Section 7.15(10), Texas Savings Bank Act (Article 489e, Vernon's Texas Civil Statutes)). Investments in securities by trust companies are regulated by Section 184.101, Finance Code (enacted in 1997 as Section 5.101, Texas Trust Company Act (Article 342a-5.101, Vernon's Texas Civil Statutes)). Investments in securities by building and loan associations (now called savings and loan associations) are regulated by Sections 63.002 and 64.001, Finance Code. As to the remaining entities listed, Section 17 is superseded by Section 1201.041, Government Code, enacted as Section 9, Bond Procedures Act of 1981 (Article 717k-6, Vernon's Texas Civil Statutes). While Section 17 lists "guardians" and Section 1201.041 does not, Section 1201.041 includes a "fiduciary" and a guardian is a fiduciary. Section 1201.041, Government Code, applies to district bonds by application of Section 1201.002, Government Code. The revised law omits the reference to sinking funds of this state because it has been superseded by Section 404.024, Government Code (enacted in 1985 as Section 2.014, Treasury Act (Article 4393-1, Vernon's Texas Civil Statutes)), which governs the investment of state funds. Section 404.024(b)(10), Government Code, authorizes the investment of state funds in obligations of political subdivisions, including hospital districts. The omitted law reads:

Sec. 17. All bonds issued by or assumed by the districts authorized to be established and created under the provisions of this Act shall be and are declared to be legal and authorized investments for banks, savings banks, trust companies, building and loan associations, insurance companies, fiduciaries, trustees, guardians, and for the sinking funds of cities, towns, villages, counties, school districts, or other political corporations or subdivisions of the State of Texas; and … .

(2) Section 17, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that district bonds may secure certain deposits. Although Section 17 does not specifically mention the deposits the bonds are eligible to secure, the only deposits the bonds could secure are deposits of public funds of this state or political subdivisions of this state. Therefore, the revised law omits the provision as impliedly repealed by Section 404.0221, Government Code (enacted in 1995), which lists eligible collateral for deposits of state funds by the comptroller, and by Chapter 2257, Government Code (enacted in 1989 as Article 2529d, Vernon's Texas Civil Statutes), which governs eligible collateral for deposits of funds of other public agencies, including political subdivisions. The omitted law reads:

Sec. 17. … such bonds shall be lawful and sufficient security for deposits to the extent of their face value when accompanied by all unmatured coupons appurtenant thereto.

[Sections 1043.209-1043.250 reserved for expansion]

SUBCHAPTER F. TAXES

Revised Law

Sec. 1043.251. IMPOSITION OF AD VALOREM TAX. (a) On final approval of the annual budget, the board shall impose a tax on all property in the district subject to district taxation.

(b) The tax may be used to:

(1) pay the indebtedness issued or assumed by the district; and

(2) maintain and operate the district.

(c) The district may not impose a tax to pay the principal of or interest on revenue bonds. (Acts 57th Leg., 1st C.S., Ch. 43, Secs. 5(a) (part), 6D(b) (part), 9 (part).)

Source Law

Sec. 5. (a) Upon the creation of such hospital district, the board of directors shall have the power and authority and it shall be their duty to levy on all property subject to hospital district taxation for the benefit of the district … , a tax … . The taxes may be used to pay the indebtedness issued or assumed by the district and for the maintenance and operation of the district… .

[Sec. 6D]

(b) … The district may not impose taxes to pay the principal of or interest on revenue bonds.

Sec. 9. … upon final approval of the budget, the board of directors shall levy such tax as may be required and … .

Revisor's Note

(1) Section 5(a), Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that "[u]pon the creation of such hospital district," the board shall impose taxes. The revised law omits the quoted language as executed.

(2) Section 5(a), Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, requires the board to impose taxes at a certain time and in a certain manner. The revised law omits that provision because it was repealed by Section 6(b), Chapter 841, Acts of the 66th Legislature, Regular Session, 1979, which repealed all "general, local, and special laws" that conflicted with that act. The 1979 act enacted the Property Tax Code (Title 1, Tax Code), a comprehensive, substantive codification of property tax law. Title 1, Tax Code, provides the exclusive procedures for the imposition and collection of property taxes by a taxing unit, including a hospital district. The omitted law reads:

(a) … [the board of directors shall … levy on all property subject to hospital district taxation for the benefit of the district] at the same time taxes are levied for county purposes, using the county values and the county tax roll, … .

Revised Law

Sec. 1043.252. TAX RATE. The board may impose the tax at a rate not to exceed 25 cents on each $100 valuation of all taxable property in the district. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 5(a) (part).)

Source Law

(a) … [the board of directors shall] … [levy] … a tax of not to exceed twenty-five cents (25¢) on the One Hundred Dollar valuation of all taxable property within the hospital district… .

Revised Law

Sec. 1043.253. TAX ASSESSOR-COLLECTOR. (a) Except as provided by Subsection (b), the tax assessor-collector of Hopkins County shall assess and collect taxes imposed by the district.

(b) The board may provide for the appointment of a tax assessor-collector for the district or may contract for the assessment and collection of taxes as provided by the Tax Code. (Acts 57th Leg., 1st C.S., Ch. 43, Secs. 5(a) (part), (b) (part), 9 (part).)

Source Law

Sec. 5. (a) … The county tax assessor-collector is the tax assessor-collector for the district… .

(b) … The board may provide for the appointment of a tax assessor-collector for the district or may contract for the assessment and collection of taxes as provided by the Tax Code.

Sec. 9. … it shall be the duty of the said tax assessor and collector to assess and collect such tax.

Revisor's Note

(1) Sections 5(a) and (b), Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provide that the Tax Code governs the appraisal, assessment, and collection of district taxes. The revised law omits that provision because Section 1.02, Tax Code, requires all taxing units of government to administer the assessment and collection of an ad valorem tax in conformity with Title 1, Tax Code. The omitted law reads:

(a) … The Tax Code governs the appraisal, assessment, and collection of district taxes… .

(b) The Tax Code governs the appraisal, assessment, and collection of district taxes… .

(2) Section 5(a), Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that tax revenue shall be deposited in the district's depository and may be withdrawn only as provided by the act. The revised law omits the provision regarding the deposit of tax revenue because Section 31.10, Tax Code, requires the tax assessor-collector of a taxing unit to deposit taxes collected in the unit's depository. The revised law omits the provision regarding withdrawal of tax revenue because the provisions of this chapter regarding the expenditure of district money apply according to their own terms. The omitted law reads:

(a) … The tax collections shall be deposited in the district depository; and such funds shall be withdrawn only as provided herein… .

(3) Section 9, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, requires the board to levy the tax and to certify the tax rate to the tax assessor-collector. The revised law omits that provision because Section 26.05(a), Tax Code, requires the governing body of a taxing unit to adopt a tax rate for the current tax year and to notify the tax assessor of that rate. The omitted law reads:

Sec. 9. … [and upon final approval of the budget, the board of directors shall] … certify the tax rate for such year to the county tax assessor and collector as provided in Section 5 hereof, and … .

Revisor's Note

(End of Subchapter)

(1) Section 5(a), Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that the directors may impose taxes for the entire year in which the district is established. The revised law omits this provision as executed. The omitted law reads:

(a) … The board of directors shall have the authority to levy the tax aforesaid for the entire year in which the said hospital district is established for the purpose of securing funds to initiate the operation of the hospital district, and to pay assumed bonds… .

(2) Section 13, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that the delinquent taxes owed to Hopkins County or a city in Hopkins County at the time of enactment of that section shall be paid to the district. Section 33.02, Tax Code, provides that a person may pay delinquent taxes over a 36-month period. Section 33.05, Tax Code, prohibits a taxing unit from filing a suit to collect a tax on real property that has been delinquent more than 20 years. Therefore, the revised law omits the provision as executed. The omitted law reads:

Sec. 13. … That portion of delinquent taxes owed cities or to the county or levied for present city and county hospital systems under Acts of the Forty-eighth Legislature, 1943, Chapter 383, page 691, shall continue to be paid to the hospital district by the city and county as collected and applied by the hospital district to the purposes for which such taxes originally were levied.

[Sections 1043.254-1043.300 reserved for expansion]

SUBCHAPTER G. DISSOLUTION

Revised Law

Sec. 1043.301. DISSOLUTION; ELECTION. (a) The district may be dissolved and the district's assets and liabilities sold or transferred to another person only on approval of a majority of the district voters voting at an election held for that purpose.

(b) The board may order an election on the question of dissolving the district and transferring the district's assets and liabilities.

(c) The board shall order an election if the board receives a petition requesting an election that is signed by a number of district residents equal to at least 15 percent of the registered voters in the district, according to the most recent official list of registered voters.

(d) The election shall be called not later than the 60th day after the date the petition is presented to the board.

(e) The order calling the election must state:

(1) the nature of the election, including the proposition to appear on the ballot;

(2) the date of the election;

(3) the hours during which the polls will be open; and

(4) the location of the polling places.

(f) Section 41.001(a), Election Code, does not apply to an election ordered under this section. (Acts 57th Leg., 1st C.S., Ch. 43, Secs. 21(a), (b), (c), (d), (g).)

Source Law

Sec. 21. (a) The district may be dissolved and its assets and liabilities sold or transferred to another entity or person only if the dissolution and transfer are approved by a majority of the qualified voters of the territory of the district voting at an election called and held for that purpose.

(b) A majority of the directors may order an election to be held on the question of dissolution of the district and the transfer of its assets and liabilities.

(c) On presentation of a petition for a dissolution election signed by a number of registered voters of the district equal to at least 15 percent of the registered voters residing in the district, according to the most recent official list of registered voters, the directors shall order an election to be held on the question of dissolution of the district and transfer of its assets. The election shall be called not later than the 60th day after the date the petition is presented to the district.

(d) The order calling the election must state:

(1) the nature of the election, including the proposition that is to appear on the ballot;

(2) the date of the election;

(3) the hours during which the polls will be open; and

(4) the location of the polling places.

(g) Section 41.001(a), Election Code, does not apply to an election ordered under this section.

Revisor's Note

(1) Section 21(a), Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, refers to another "entity or person." Throughout this chapter, the revised law omits "entity" because "entity" is included in the meaning of person under Section 311.005(2), Government Code (Code Construction Act).

(2) Section 21(a), Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that the district may be dissolved if authorized at an election "called and held" for that purpose. The revised law omits references to "calling" an election for the reason stated in Revisor's Note (3) to Section 1043.203.

(3) Section 21(a), Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides for dissolution of the district if approved by a majority of the "qualified" voters of the district. The revised law omits "qualified" for the reason stated in Revisor's Note (1) to Section 1043.203.

(4) Section 21(f), Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, states that the election must be held not less than 45 days after the date the election is ordered. The revised law omits the provision as superseded by Section 3.005, Election Code, applicable to the district under Section 1.002, Election Code. Section 3.005, as amended by Chapter 925, Acts of the 78th Legislature, Regular Session, 2003, requires an election order issued by the authority of a political subdivision to be issued not later than the 62nd day before election day and provides that Section 3.005 supersedes a law outside the Election Code to the extent of any conflict. The omitted law reads:

(f) The election shall be held not less than 45 days after the date on which the election is ordered.

Revised Law

Sec. 1043.302. NOTICE OF ELECTION. (a) The board shall give notice of an election under this subchapter by publishing once a week for two consecutive weeks a substantial copy of the election order in a newspaper with general circulation in the district.

(b) The first publication of the notice must appear at least 35 days before the date set for the election. (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 21(e).)

Source Law

(e) The directors shall give notice of the election by publishing a substantial copy of the election order in a newspaper with general circulation in the district once a week for two consecutive weeks. The first publication must appear at least 35 days before the date set for election.

Revised Law

Sec. 1043.303. BALLOT. The ballot for an election under this subchapter must be printed to permit voting for or against the proposition: "The dissolution of the Hopkins County Hospital District and the transfer of its assets and liabilities in the following manner: __________ (insert provisions for transfer)." (Acts 57th Leg., 1st C.S., Ch. 43, Sec. 21(h).)

Source Law

(h) The ballot for an election at which the dissolution of the district is proposed shall be printed to permit voting for or against the proposition: "The dissolution of the Hopkins County Hospital District and the transfer of its assets and liabilities in the following manner: __________ (insert provisions for transfer)."

Revised Law

Sec. 1043.304. ELECTION RESULTS. (a) If the board finds the election results favor the proposition to dissolve the district, the board shall:

(1) issue an order declaring the district dissolved; and

(2) proceed with the sale or transfer of the district's assets and liabilities according to the plan proposed on the ballot.

(b) If the board finds the election results do not favor the proposition to dissolve the district, another dissolution election may not be held before the first anniversary of the date of the election in which voters disapproved the proposition. (Acts 57th Leg., 1st C.S., Ch. 43, Secs. 21(j), (k).)

Source Law

(j) If the directors find that the election results are favorable to the proposition to dissolve the district and transfer its assets and liabilities, they shall issue an order declaring the district dissolved and shall proceed with the sale or transfer of its assets and liabilities according to the plan proposed on the ballot.

(k) If the directors find that the election results are not favorable to the proposition to dissolve the district and transfer its assets and liabilities, another dissolution election may not be held before the first anniversary of the date of the election at which voters disapproved the proposition.

Revisor's Note

Section 21(i), Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that the board shall canvass the returns of the election. The revised law omits this requirement because it duplicates Section 67.002, Election Code, which requires the governing body of a political subdivision that orders an election to canvass the returns. The omitted law reads:

(i) The directors shall canvass the returns of the election.

Revised Law

Sec. 1043.305. SALE OR TRANSFER OF ASSETS AND LIABILITIES. (a) The district may not be dissolved unless the board provides for the sale or transfer of the district's assets and liabilities to another person.

(b) The dissolution of the district and the sale or transfer of the district's assets and liabilities may not:

(1) contravene a trust indenture or bond resolution relating to the district's outstanding bonds; or

(2) diminish or impair the rights of the holders of any outstanding bonds, warrants, or other obligations of the district.

(c) The sale or transfer of the district's assets and liabilities must satisfy the debt and bond obligations of the district in a manner that protects the interests of district residents, including the residents' collective property rights in the district's assets.

(d) The district may not transfer or dispose of the district's assets except for due compensation unless:

(1) the transfer is made to another governmental agency that serves the district; and

(2) the transferred assets are to be used for the benefit of the district's residents.

(e) A grant from federal funds is an obligation to be repaid in satisfaction. (Acts 57th Leg., 1st C.S., Ch. 43, Secs. 21(l), (m).)

Source Law

(l) Notwithstanding any other provision of this section, the district may not be dissolved unless the board provides for the sale or transfer of the district's assets and liabilities to another entity or person. The dissolution of the district and the sale or transfer of the district's assets and liabilities may not contravene a trust indenture or bond resolution relating to the outstanding bonds of the district. In addition, the dissolution and sale or transfer may not diminish or impair the rights of the holders of any outstanding bonds, warrants, or other obligations of the district.

(m) The sale or transfer of the district's assets and liabilities must satisfy the debt and bond obligations of the district in a manner that protects the interests of the residents of the district, including their collective property rights in the district's assets. Any grant from federal funds is considered an obligation to be repaid in satisfaction. The district may not transfer or dispose of the district's assets except for due compensation unless the transfer is made to another governmental agency embracing the district and using the transferred assets for the benefit of residents formerly in the district.

Revisor's Note

(End of Chapter)

(1) Sections 2 and 7, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, allow for the district's assumption of certain hospitals or hospital systems, provide for the transfer of land, buildings, equipment, funds, and taxes to the district after the district is created, and provide for the assumption of debt by the district on creation. The revised law omits the provisions as executed. The omitted law reads:

Sec. 2. … may take over the hospital or hospital system, either owned separately by the county or jointly with a city within the county, or … .

Sec. 7. Any lands, buildings or equipment that may be jointly or separately owned by the county and city within the boundaries of the district and by which medical services or hospital care, including geriatric care, are furnished to needy persons of the city and county, shall become the property of the hospital district; and title thereto shall vest in the hospital; and any funds of such city and county, or either, which are the proceeds of any bonds assumed by the hospital district, as hereby provided, shall become the funds of the hospital district; and title thereto shall vest in the hospital district; and there shall vest in the hospital district and become the funds of the hospital district the unspent portions of any funds theretofore set up or appropriated by budget or otherwise by such city or the county, or either of them, for the support and maintenance of the hospital facilities for the year within which the hospital district comes into existence, thereby providing such hospital district with funds with which to maintain and operate such facilities for the remainder of such year. All obligations under contract legally incurred by such city or county, or either of them, for the building of, or the support and maintenance of, hospital facilities, prior to the creation of the said district but outstanding at the time of the creation of the district, shall be assumed and discharged by the hospital district without prejudice to the rights of third parties, provided that the management and control of the property and affairs of the present hospital system shall continue in the board of managers of such system until appointment and organization of the board of directors of the hospital district, at which time the board of managers of the present hospital system or systems shall turn over all records, property and affairs of said hospital system to the board of directors of the hospital district and shall cease to exist.

Any outstanding bonded indebtedness incurred by such city or county, either or both of them, in the acquisition of such lands, buildings and equipment, or in the construction and equipping of such hospital facilities, together with any other outstanding bonds issued by either of them for hospital purposes, and the proceeds of which are in whole or in part still unspent, shall be assumed by the hospital district and become the obligation of the hospital district; and the city or county, either or both of them, that issued such bonds, shall be by the hospital district relieved of any further liability for the payment thereof, or for providing interest and sinking fund requirements thereon; … .

The Commissioners Court and the city, where a hospital or hospital system is jointly operated, or the Commissioners Court, if the county owns the hospital or hospital system, as the case may be, as soon as the hospital district is created and authorized at the election hereinabove provided, and there have been appointed and qualified the board of hospital managers as hereinbefore provided, shall execute and deliver to the hospital district, to wit: to its said board of directors, an instrument in writing conveying to said hospital district the hospital property, including lands, buildings and equipment; and shall transfer to said hospital district the funds hereinabove provided to become vested in the hospital district, upon being furnished the certificate of the chairman of the board to the fact that a depository for the district's funds has been selected and has qualified; which funds shall, in the hands of the hospital district and of its board of directors, be used for all or any of the same purposes as, and for no other purposes than, the purposes for which the county or the city transferring such funds could lawfully have used the same had they remained the property and funds of such county or city.

(2) Section 7, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that the transfer of facilities and money to the district by Hopkins County or a city located in Hopkins County does not affect the rights of bondholders. The revised law omits the provision because Section 16, Article I, Texas Constitution, prohibits any law that impairs the obligations of a contract. The omitted law reads:

Sec. 7. … provided that nothing herein contained shall limit or affect any of the rights of any of the holders of such bonds against the city or the county, as the case may be, in the event of default in the payment of the principal or interest on any of such bonds in accordance with their respective terms… .

(3) Section 19, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, provides that the act is severable. The revised law omits that provision because it duplicates Section 311.032, Government Code (Code Construction Act), which provides that a provision of a statute is severable from each other provision of the statute that can be given effect. The omitted law reads:

Sec. 19. … If any provision of this Act should be invalid, such fact shall not affect the authorization for the creation of the district or the validity of any other provision of this Act, and the Legislature here declares that it would have created the district and enacted the valid provisions of this Act notwithstanding the invalidity of any other provision or provisions hereof.

(4) Section 3, Chapter 9, Acts of the 59th Legislature, Regular Session, 1965, validates various election procedures in 1961, various bond and tax provisions arising out of that election, and actions taken by the hospital district established by the election. The revised law omits the provision as executed. The omitted law reads:

Sec. 3. That the creation, establishment, organization, maintenance, and operation of the hospital district in Hopkins County, coextensive with the boundaries of said County, and known as the Hopkins County Hospital District, and the establishment and organization of the Board of Directors thereof, are hereby validated in all respects as though they had been duly and lawfully accomplished in the first instance; and all taxes and bonds voted in said District, and all elections held to authorize same, are hereby validated in all respects, as though they had been duly and lawfully conducted in the first instance; and all acts and proceedings performed, had, or attempted pursuant to this Act are hereby validated in all respects, as though they had been duly and lawfully accomplished in the first instance.

(5) Section 2, Chapter 98, Acts of the 75th Legislature, Regular Session, 1997, provides transition language concerning board elections. The revised law omits the language as executed. The omitted law reads:

Sec. 2. (a) The district shall hold an election for directors on May 2, 1998. In addition to the two directors previously scheduled to be elected at that election, two new directors shall be elected. The two directors who receive the two highest number of total votes shall serve three-year terms and the two directors who receive the third- and fourth-highest number of total votes shall serve two-year terms. If two or more persons receive the same total number of votes and if it is necessary to break the tie so that terms may be assigned under this subsection, those persons shall draw lots to determine their respective terms.

(b) The three directors elected at the election on May 1, 1999, shall serve three-year terms.

(c) Three members of the board of directors constitute a quorum until May 2, 1998, regardless of the quorum requirement of Section 3, Chapter 43, Acts of the 57th Legislature, 1st Called Session, 1961, as amended by this Act.


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