80C115(3) JRJ

 

CHAPTER 1054.  LYNN COUNTY HOSPITAL DISTRICT

SUBCHAPTER A.  GENERAL PROVISIONS

Revised Law

Sec. 1054.001.  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 Lynn 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. 1054.002.  AUTHORITY FOR OPERATION.  The Lynn County Hospital District operates in accordance with Section 9, Article IX, Texas Constitution, and has the rights, powers, and duties provided by this chapter.  (Acts 60th Leg., R.S., Ch. 66, Sec. 1 (part).)

Source Law

Sec. 1.  In accordance with the provisions of Article IX, Section 9, 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 this State … to be known as "Lynn County Hospital District" with the rights, powers and duties provided in this Act.

Revisor's Note

Section 1, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, 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."

Revised Law

Sec. 1054.003.  ESSENTIAL PUBLIC FUNCTION.  The district performs an essential public function in carrying out the purposes of this chapter.  (Acts 60th Leg., R.S., Ch. 66, Sec. 20 (part).)

Source Law

Sec. 20.  In carrying out the purpose of this Act, the district will be performing an essential public function and … .

Revised Law

Sec. 1054.004.  DISTRICT TERRITORY.  The boundaries of the district are coextensive with the boundaries of Lynn County, Texas.  (Acts 60th Leg., R.S., Ch. 66, Sec. 1 (part).)

Source Law

Sec. 1.  … [a hospital district within this State] with boundaries coextensive with the boundaries of Lynn County, Texas, … .

Revised Law

Sec. 1054.005.  DISTRICT SUPPORT AND MAINTENANCE NOT STATE OBLIGATION.  The support and maintenance of the district may not become a charge against or obligation of this state.  (Acts 60th Leg., R.S., Ch. 66, Sec. 21 (part).)

Source Law

Sec. 21.  The support and maintenance of the hospital district shall never become a charge against or obligation of the State of Texas, … .

Revised Law

Sec. 1054.006.  RESTRICTION ON STATE FINANCIAL ASSISTANCE.  The legislature may not make a direct appropriation for the construction, maintenance, or improvement of a district facility.  (Acts 60th Leg., R.S., Ch. 66, Sec. 21 (part).)

Source Law

Sec. 21.  … nor shall any direct appropriation be made by the Legislature for the construction, maintenance or improvement of any of the facilities of the district.

Revisor's Note

(End of Subchapter)

(1)  Section 2, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, contains a legislative finding relating to the existence of a hospital, hospital system, and hospital facility before the creation of the district.  The revised law omits this provision as executed.  The omitted law reads:

Sec. 2.  … It is found and determined that there is no hospital or hospital system or hospital facilities of any nature presently owned by Lynn County or by any city or town within the boundaries set forth in this Act.

(2)  Sections 3 and 8, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, provide 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. 3.  (a)  The district shall not be created, nor shall any tax in the district be authorized unless and until the creation and the tax are approved by a majority of the qualified property taxpaying electors of the area of the proposed district voting at an election called for that purpose.  The election may be called by a majority of the temporary or provisional directors or shall be called by the provisional directors upon presentation of a petition for an election signed by at least 100 qualified property taxpaying electors of the area of the proposed district.  The election shall be held not less than 35 nor more than 60 days from the date the election is ordered.  The order calling the election shall specify the date, place or places of holding the election, the form of ballot, the presiding judge and alternate judge for each voting place and provide for clerks as in county elections.  Notice of election shall be given by publishing a substantial copy of the election order in a newspaper of general circulation in the county once a week for two consecutive weeks, the first publication to appear at least 30 days prior to the date established for the election.  If the proposition to create the Lynn County Hospital District fails to carry at the election, no other election for the same purpose may be held within one year after the result of the election is announced officially.

(b)  At the election there shall be submitted to the qualified property taxpaying electors of the area of the proposed district the proposition of whether the hospital district shall be created with authority to levy annual taxes at a rate not to exceed 75 cents on the $100 valuation of taxable property within the district subject to hospital district taxation, for the purpose of meeting the requirements of the district's bonds, maintenance, and operating expenses.

(c)  The ballots for the election shall have printed thereon the following:

"FOR the creation of Lynn County Hospital District providing for the levy of a tax not to exceed 75 cents on each $100 valuation using Lynn County values and Lynn County tax rolls."

"AGAINST the creation of Lynn County Hospital District providing for the levy of a tax not to exceed 75 cents on each $100 valuation using Lynn County values and Lynn County tax rolls."

(d)  Within 10 days after the election is held, the provisional directors of the district shall convene and canvass the returns of the election and, in the event the election results favorably to the proposition specified in Section 3, the board shall so find and declare the hospital district established and created.

Sec. 8.  The provisional directors may incorporate a separate proposition at the election on the creation of the district as to whether the board of directors of the district, in the event the district is created, shall be authorized to issue bonds for the purposes specified in the first paragraph of Section 7.  The proposition shall specify the purpose for which the bonds are to be issued, the maximum amount of bonds to be issued, their maximum maturity and maximum interest rate.

[Sections 1054.007-1054.050 reserved for expansion]

SUBCHAPTER B.  DISTRICT ADMINISTRATION

Revised Law

Sec. 1054.051.  BOARD ELECTION; TERM.  (a)  The board consists of seven directors elected from the district at large.

(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 60th Leg., R.S., Ch. 66, Secs. 4(a), (e) (part).)

Source Law

Sec. 4.  (a)  Seven directors shall be elected by a vote of the qualified voters of the entire district for three-year terms.

(e)  A regular election of directors shall be held on the first Saturday in May of each year and … .

Revisor's Note

(1)  Section 4(e), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, was amended in 1993 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 the legislative intent expressed in the 1993 amendment to Section 4(e) that the election be held on the first Saturday in May, which was at that time the uniform election date in May.

(2)  Section 4(b), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, prescribes that the directors acting as a board may exercise the powers conferred on the board by the act. The revised law omits that provision because any grant of power to the board would apply by its own terms.  The omitted law reads:

(b)  … the directors, acting as a board, shall have and exercise the powers conferred on the board by this Act.

(3)  Section 9, Chapter 600, Acts of the 73rd Legislature, Regular Session, 1993, provides for the staggering of terms for directors to accomplish the change of the members' terms from two to three years.  The revised law omits that provision as executed.  The omitted law reads:

Sec. 9.  The terms of office for the successors to the directors currently serving in places two, four, and six shall begin on the first Saturday in May, 1994, and shall expire on the first Saturday in May, 1997.  The terms of office for the successors to the directors currently serving in places three and five shall begin on the first Saturday of May, 1995, and shall expire on the first Saturday in May, 1998.  The terms of office for the successors to the directors serving in places one and seven shall begin on the first Saturday in May, 1995, and shall expire on the first Saturday in May, 1996.  Thereafter, all successive terms shall be of three years duration.

Revised Law

Sec. 1054.052.  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 the district.  (Acts 60th Leg., R.S., Ch. 66, Sec. 4(e) (part).)

Source Law

(e)  … notice of the election shall be published in a newspaper of general circulation in the district one time at least 10 days before the date of election… .

Revised Law

Sec. 1054.053.  BALLOT PETITION.  A person who wants to have the person's name printed on the ballot as a candidate for director must file with the board secretary a petition requesting that action.  The petition must be:

(1)  signed by not fewer than 25 registered voters; and

(2)  filed before the 31st day before the date of the election. (Acts 60th Leg., R.S., Ch. 66, Sec. 4(e) (part).)

Source Law

(e)  … Any person desiring his name to be printed on the ballot as a candidate for director shall file a petition with the secretary of the board of directors of the district, signed by not less than 25 qualified electors, asking that his name be printed on the ballot.  The petition shall be filed before the 31st day before the date of election.

Revisor's Note

Section 4(e), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, refers to a petition signed by 25 "qualified electors."  The revised law substitutes "registered" for "qualified" because in the context of eligibility to sign a petition, Section 277.0021, Election Code, provides that "qualified voter" means "registered voter."  In addition, throughout this chapter, the revised law substitutes "voters" for "electors" because the former is the term used in the Election Code.

Revised Law

Sec. 1054.054.  QUALIFICATIONS FOR OFFICE.  (a)  To be eligible to be a candidate for or to serve as a director, a person must be:

(1)  a resident of the district; and

(2)  a qualified voter.

(b)  A district employee may not serve as a director.  (Acts 60th Leg., R.S., Ch. 66, Secs. 4(c), (f).)

Source Law

(c)  To be eligible to be a candidate for or to serve as a director, a person must be:

(1)  a resident of the district; and

(2)  a qualified voter.

(f)  An employee of the district may not serve as a director.

Revised Law

Sec. 1054.055.  BOND; RECORD OF BOND.  (a)  Before assuming the duties of office, each director must execute a bond for $5,000 that is:

(1)  payable to the district; and

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

(b)  Each director's bond shall be kept in the district's permanent records.

(c)  The board may pay for a director's bond with district money.  (Acts 60th Leg., R.S., Ch. 66, Secs. 4(g), (h).)

Source Law

(g)  Before assuming the duties of the office, each director must execute a bond for $5,000 payable to the district, conditioned on the faithful performance of the person's duties as director.  The bond shall be kept in the permanent records of the district.

(h)  The board of directors may pay for directors' bonds with district funds.

Revisor's Note

Section 4(b), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, 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 to take the oath (or affirmation) before assuming office.  The omitted law reads:

(b)  Each director and his successor in office shall qualify by executing the constitutional oath of office, and … .

Revised Law

Sec. 1054.056.  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 fewer than four 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 60th Leg., R.S., Ch. 66, Sec. 4(d) (part).)

Source Law

(d)  … 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 four for any reason, the remaining directors shall immediately call a special election to fill the vacancies, and on failure to do so, a district court, on application of any elector or taxpayer of the district, may issue a mandate requiring that the election be ordered by the remaining directors.

Revised Law

Sec. 1054.057.  OFFICERS.  (a)  The board shall elect:

(1)  a president and a vice president from among its members; and

(2)  a secretary, who need not be a director.

(b)  Each officer of the board serves for a term of one year.

(c)  The board shall fill a vacancy in a board office for the unexpired term.  (Acts 60th Leg., R.S., Ch. 66, Sec. 4(d) (part).)

Source Law

(d)  The board of directors shall organize by electing one of their number as president and one of their number as vice president.  A secretary, who need not be a director, shall also be elected.  Each officer of the board holds that office for a term of one year… .  The board of directors shall fill a vacancy in a board office for the unexpired term… .

Revised Law

Sec. 1054.058.  EXPENSES.  A director or officer may be reimbursed for actual expenses incurred in the performance of official duties.  The expenses must be:

(1)  reported in the district's records; and

(2)  approved by the board. (Acts 60th Leg., R.S., Ch. 66, Sec. 4(i).)

Source Law

(i)  Directors and officers may be reimbursed for actual expenses incurred in the performance of official duties.  Expenses reimbursed under this subsection must be:

(1)  reported in the district's minute book or other district records; and

(2)  approved by the board of directors.

Revisor's Note

Section 4(i), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, requires that approved expenses be reported in the "district's minute book or other district records."  The revised law omits the reference to the "district's minute book" because the minute book is a district record.

Revised Law

Sec. 1054.059.  VOTING REQUIREMENT.  A concurrence of four directors is sufficient in any matter relating to district business.  (Acts 60th Leg., R.S., Ch. 66, Sec. 4(d) (part).)

Source Law

(d)  … [members of the board of directors] … a concurrence of four shall be sufficient in all matters pertaining to the business of the district… .

Revisor's Note

Section 4(d), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, provides that four directors constitute 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:

(d)  … Four members of the board of directors shall constitute a quorum and … .

Revised Law

Sec. 1054.060.  DISTRICT ADMINISTRATOR; ASSISTANT ADMINISTRATOR.  (a)  The board shall appoint a qualified person as district administrator.

(b)  The board may appoint an assistant administrator.

(c)  The district administrator and any assistant administrator serve at the will of the board and are entitled to the compensation determined by the board.

(d)  On assuming the duties of district administrator, the administrator shall execute a bond payable to the district in an amount set by the board of not less than $5,000 that:

(1)  is conditioned on the administrator performing the administrator's duties; and

(2)  contains other conditions the board may require.

(e)  The board may pay for the bond with district money.   (Acts 60th Leg., R.S., Ch. 66, Sec. 5(a) (part).)

Source Law

(a)  … The board of directors shall appoint a qualified person to be known as the administrator or manager of the hospital district and may in its discretion appoint an assistant to the administrator or manager.  The administrator or manager and assistant administrator or assistant manager, if any, shall serve at the will of the board and shall receive compensation as may be fixed by the board.  The administrator or manager, on assuming his duties, shall execute a bond payable to the hospital district in an amount to be set by the board of directors, in no event less than $5,000, conditioned that he shall perform the duties required of him, and containing other conditions as the board may require.  The board of directors may pay for the bond with district funds… .

Revisor's Note

Section 5, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, provides that the board shall appoint a person as the "administrator or manager" of the district and may appoint an "assistant administrator or manager."  Throughout this chapter, the revised law omits "manager" because, in context, "manager" is included in the meaning of "administrator" and "administrator" is the term used by the district.

Revised Law

Sec. 1054.061.  GENERAL DUTIES OF DISTRICT ADMINISTRATOR.  Subject to the limitations prescribed by the board, the district administrator shall:

(1)  supervise the work and activities of the district; and

(2)  direct the affairs of the district.  (Acts 60th Leg., R.S., Ch. 66, Sec. 5(a) (part).)

Source Law

(a)  … The administrator or manager shall supervise all the work and activities of the district and shall have general direction of the affairs of the district, subject to the limitations prescribed by the board… .

Revised Law

Sec. 1054.062.  APPOINTMENT OF STAFF AND EMPLOYEES.  (a)  The board may appoint to the staff any doctors and employ any technicians, nurses, and other employees the board considers necessary for the efficient operation of the district.

(b)  The district may employ fiscal agents, accountants, architects, and attorneys the board considers proper.

(c)  The board may provide that the district administrator has the authority to hire district employees, including technicians and nurses.

(d)  The board may define the duties, functions, and responsibilities of district staff and employees.  (Acts 60th Leg., R.S., Ch. 66, Secs. 5(a) (part), 16.)

Source Law

Sec. 5.  (a) …  The district through its board of directors shall have the power and authority … to define the duties, functions, and responsibilities of the staff and employees of the district… .  The board of directors shall have the authority to appoint to the staff such doctors, and employ such technicians, nurses and other employees of every kind and character deemed necessary for the efficient operation of the district.  The board may provide that the administrator or manager shall have the authority to employ technicians, nurses and employees of the district… .

Sec. 16.  The district may employ fiscal agents, accountants, architects and attorneys as the board may consider proper.

Revised Law

Sec. 1054.063.  RECRUITMENT OF MEDICAL STAFF.  The board may spend district money to recruit physicians, nurses, and other trained medical personnel. The board may pay the tuition or other education-related costs or expenses of a person who:

(1)  graduates from a medical school, nursing school, or an institution of higher education; and

(2)  contractually agrees to become a district employee.  (Acts 60th Leg., R.S., Ch. 66, Sec. 5A(b) (part).)

Source Law

(b)  The board of directors may spend district funds to:

(1)  recruit physicians, nurses, or other trained medical personnel and, in connection with recruitment, may pay a person's tuition or other education-related costs or expenses if the person contractually agrees to become an employee of the district after graduation from a medical or nursing school or an institution of higher education; or … .

Revised Law

Sec. 1054.064.  CONTINUING EDUCATION; RETRAINING.  The board may spend district money for continuing education and retraining of district employees.  (Acts 60th Leg., R.S., Ch. 66, Sec. 5A(b) (part).)

Source Law

(b)  The board of directors may spend district funds to:

…

(2)  provide for continuing education and retraining of district employees.

Revised Law

Sec. 1054.065.  RETIREMENT BENEFITS.  The board may provide retirement benefits for district employees by:

(1)  establishing or administering a retirement program; or

(2)  participating in:

(A)  the Texas County and District Retirement System; or

(B)  another statewide retirement system in which the district is eligible to participate.  (Acts 60th Leg., R.S., Ch. 66, Sec. 5B.)

Source Law

Sec. 5B.  The board of directors may provide retirement benefits for employees of the district by:

(1)  establishing or administering a retirement program; or

(2)  electing to participate in the Texas County and District Retirement System or in any other statewide retirement system in which the district is eligible to participate.

[Sections 1054.066-1054.100 reserved for expansion]

SUBCHAPTER C.  POWERS AND DUTIES

Revised Law

Sec. 1054.101.  DISTRICT RESPONSIBILITY.  The district has full responsibility for operating all hospital facilities for providing medical and hospital care for the district's needy inhabitants.  (Acts 60th Leg., R.S., Ch. 66, Sec. 19 (part).)

Source Law

Sec. 19.  … The hospital district shall assume full responsibility for the operation of all hospital facilities for the furnishing of medical and hospital care for its needy inhabitants.

Revisor's Note

Section 19, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, provides that the district "shall assume" full responsibility for operating hospital facilities for providing medical and hospital care for the district's needy inhabitants.  The revised law substitutes "has" for the quoted language because the duty to assume the responsibility is executed.

Revised Law

Sec. 1054.102.  RESTRICTION ON POLITICAL SUBDIVISION TAXATION AND DEBT.  A political subdivision located within the district may not impose a tax or issue bonds or other obligations for hospital purposes or to provide medical care.  (Acts 60th Leg., R.S., Ch. 66, Sec. 19 (part).)

Source Law

Sec. 19.  After creation of the hospital district, no municipality or political subdivision within the boundaries of the district shall have the power to levy taxes or issue bonds or other obligations for hospital purposes or for providing medical care… .

Revisor's Note

(1)  Section 19, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, provides that "[a]fter creation of the hospital district," certain political subdivisions may not levy taxes or issue bonds.  The revised law omits the quoted language as executed.  In addition, throughout this chapter, the revised law substitutes "impose" for "levy" because, in this context, the terms are synonymous and the former is more commonly used.

(2)  Section 19, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, refers to a "municipality or political subdivision."  The revised law omits the reference to "municipality" because "municipality" is included in the meaning of "political subdivision."

Revised Law

Sec. 1054.103.  MANAGEMENT, CONTROL, AND ADMINISTRATION.  The board shall manage, control, and administer the district's hospitals and hospital system.  (Acts 60th Leg., R.S., Ch. 66, Sec. 5(a) (part).)

Source Law

Sec. 5.  (a)  The board of directors shall manage, control and administer the hospitals and hospital system of the district… .

Revised Law

Sec. 1054.104.  HOSPITAL SYSTEM.  The district shall provide for the establishment of a hospital or hospital system in the district by:

(1)  purchasing, constructing, acquiring, repairing, or renovating buildings and improvements;

(2)  equipping the buildings and improvements; and

(3)  administering the buildings and improvements for hospital purposes. (Acts 60th Leg., R.S., Ch. 66, Sec. 2 (part).)

Source Law

Sec. 2.  The district authorized by this Act to be created shall provide for the establishment of a hospital or a hospital system within its boundaries by the purchase, construction, acquisition, repair or renovation of buildings and improvements and the equipping of same and the administration therefor for hospital purposes… .

Revised Law

Sec. 1054.105.  RULES.  The board may adopt rules for the operation of the district.  (Acts 60th Leg., R.S., Ch. 66, Sec. 5(a) (part).)

Source Law

(a)  … The district through its board of directors shall have the power and authority … to promulgate rules and regulations for the operation of the district, and … .

Revisor's Note

Section 5(a), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, provides that the board may "promulgate rules and regulations" for the district.  The revised law substitutes "adopt" for "promulgate" because the terms are synonymous and the former is more commonly used.  The revised law omits "regulations" because under Section 311.005(5), Government Code (Code Construction Act), a rule is defined to include a regulation.

Revised Law

Sec. 1054.106.  PURCHASING AND ACCOUNTING PROCEDURES.  The board may prescribe:

(1)  the method and manner of making purchases and expenditures by and for the district in a manner consistent with Subtitle C, Title 8, Local Government Code; and

(2)  all accounting and control procedures.  (Acts 60th Leg., R.S., Ch. 66, Sec. 10 (part).)

Source Law

Sec. 10.  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 in a manner that is consistent with Subtitle C, Title 8, Local Government Code, and shall be authorized to prescribe all accounting and control procedures… .

Revised Law

Sec. 1054.107.  DISTRICT PROPERTY, FACILITIES, AND EQUIPMENT.  (a)  The board shall determine the type, number, and location of buildings required to maintain an adequate hospital system.  Nothing in this chapter prohibits the establishing and equipping of a clinic as part of the hospital system.

(b)  The board may lease all or part of the district's buildings and other facilities on terms considered to be in the best interest of the district's inhabitants.  The term of the lease may not exceed 25 years.

(c)  The district may acquire equipment for use in the district's hospital system and mortgage or pledge the property as security for the payment of the purchase price.

(d)  The district may sell or otherwise dispose of any property, including equipment, on terms the board finds are in the best interest of the district's inhabitants.  (Acts 60th Leg., R.S., Ch. 66, Secs. 9 (part), 10 (part).)

Source Law

Sec. 9.  The board of directors is hereby given complete discretion as to the type of buildings, both as to number and location, required to establish and maintain an adequate hospital system.  Nothing in this Act shall prohibit the establishing and equipping of a clinic as a part of the hospital system.  The district, through its board of directors, … may lease all or part of its buildings and facilities on terms and conditions considered to be to the best interest of its inhabitants, provided that in no event shall any lease be for a period in excess of 25 years from the date entered.  The district shall be empowered to sell or otherwise dispose of any property, real or personal, or equipment of any nature on terms and conditions found by the board to be in the best interest of its inhabitants.

Sec. 10.  … The district may acquire equipment for use in its hospital system and mortgage or pledge the property so acquired as security for the payment of the purchase price… .

Revisor's Note

(1)  Section 9, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, requires the board to determine the buildings required to "establish and maintain" an adequate hospital system.  The revised law omits the reference to establishing the hospital system as executed.

(2)  Section 9, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, refers to "terms and conditions."  The revised law omits the reference to "conditions" because "conditions" is included in the meaning of "terms."

(3)  Section 9, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, refers to "any property, real or personal."  The revised law omits the reference to "real or personal" property because under Section 311.005, Government Code (Code Construction Act), "property" means "real and personal property."

Revised Law

Sec. 1054.108.  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 located in district territory if the interest is necessary or convenient for the district to exercise a power, right, or privilege conferred 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.

(c)  In a condemnation proceeding brought by the district, the district is not required to:

(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 60th Leg., R.S., Ch. 66, Sec. 14.)

Source Law

Sec. 14.  The district shall have the right and power of eminent domain for the purpose of acquiring by condemnation property of any kind and character in fee simple, or any lesser interest therein, within the boundaries of the district necessary or convenient to the powers, rights and privileges conferred by this Act, in the manner provided by the general law with respect to condemnation by counties, provided that the district shall not be required to make deposits in the registry of the trial court of the sum required by Section 2, Article 3268, Revised Civil Statutes of Texas, 1925, as amended, or to make bond as therein provided.  In condemnation proceedings being prosecuted by the district, the district shall not be required to pay in advance or 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 nor to give bond for costs or for supersedeas on any appeal or writ of error.

Revisor's Note

(1)  Section 14, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, 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 14, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, provides that the district must exercise the power of eminent domain in the manner provided by "the general law with respect to condemnation by counties."  The revised law substitutes for the quoted language a reference to Chapter 21, Property Code, because that is the general law governing eminent domain for governmental entities, including counties.

(3)  Section 14, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, refers to "Section 2, Article 3268, Revised Civil Statutes of Texas, 1925, as amended."  That statute was codified in 1983 as Section 21.021(a), Property Code, and the revised law is drafted accordingly.  In addition, throughout this chapter, the revised law omits the references to "as amended" because under Section 311.027, Government Code (Code Construction Act), a reference to a statute applies to all reenactments, revisions, or amendments of that statute unless expressly provided otherwise.

Revised Law

Sec. 1054.109.  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 the purposes 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 60th Leg., R.S., Ch. 66, Sec. 18.)

Source Law

Sec. 18.  The board of directors of the hospital district is authorized on behalf of the district to accept donations, gifts and endowments to be held in trust and administered by the board of directors for the purposes and under the directions, limitations and provisions as may be prescribed in writing by the donor not inconsistent with proper management and object of the hospital district.

Revisor's Note

Section 18, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, 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. 1054.110.  CONSTRUCTION CONTRACTS.  (a)  The board may enter into construction contracts for the district.

(b)  The board may enter into a construction contract that involves the expenditure of more than the amount prescribed by Section 271.024, Local Government Code, only after competitive bidding as provided by Subchapter B, Chapter 271, Local Government Code.  (Acts 60th Leg., R.S., Ch. 66, Sec. 10A.)

Source Law

Sec. 10A.  (a)  The board of directors may enter into construction contracts for the district.

(b)    The board of directors may enter into construction contracts that involve spending more than $10,000 only after competitive bidding as provided by Subchapter B, Chapter 271, Local Government Code.

Revisor's Note

Section 10A, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, provides that the district may enter into construction contracts that involve spending more than $10,000 only after competitive bidding as provided by Subchapter B, Chapter 271, Local Government Code.  The revised law omits the reference to the $10,000 amount as superseded by Section 5, Chapter 115, Acts of the 77th Legislature, Regular Session, 2001, which amended Section 271.024, Local Government Code, to increase the contract amount for which competitive bidding is required to $25,000.

Revised Law

Sec. 1054.111.  OPERATING AND MANAGEMENT CONTRACTS.  The board may enter into an operating or management contract relating to a district facility.  (Acts 60th Leg., R.S., Ch. 66, Secs. 5(b), 9 (part).)

Source Law

[Sec. 5]

(b)  The board of directors may enter into operating or management contracts relating to hospital facilities.

Sec. 9.  … The district, through its board of directors, is further authorized to enter into an operating or management contract with regard to its facilities or a part of its facilities, or … .

Revised Law

Sec. 1054.112.  CONTRACTS WITH GOVERNMENTAL ENTITIES FOR SERVICES.  (a)  The board may contract with a political subdivision of this state or with a state or federal agency for the district to:

(1)  furnish a mobile emergency medical service; or

(2)  provide for the investigatory or welfare needs of district inhabitants.

(b)  The board may contract with this state or a federal agency for the care and treatment of a sick or injured person.  (Acts 60th Leg., R.S., Ch. 66, Secs. 5(a) (part), (e).)

Source Law

(a)  … The board shall have the authority to contract with the State of Texas or agencies of the federal government for the treatment of sick, diseased or injured persons.

(e)  The board of directors may contract with a municipality, county, special district, or other political subdivision of the state or with a state or federal agency for the district to:

(1)  furnish a mobile emergency medical service; or

(2)  provide for the investigatory or welfare needs of inhabitants of the district.

Revisor's Note

(1)  Section 5(a), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, refers to a "sick, diseased or injured person."  The revised law omits the reference to "diseased" because "diseased" is included in the meaning of "sick."

(2)  Section 5(e), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, refers to "a municipality, county, special district, or other political subdivision of the state."  The revised law omits "municipality," "county," and "special district" because each of those entities is included in the meaning of "political subdivision of the state."

Revised Law

Sec. 1054.113.  PROVISION OF CERTAIN HEALTH SERVICES.  The board may provide emergency services, home health care services, long-term health care services, special care facility services, or any other health care services the board determines are necessary to meet the needs of the district.  (Acts 60th Leg., R.S., Ch. 66, Sec. 5A(a).)

Source Law

Sec. 5A.  (a)  The board of directors may provide emergency services, home health care services, long-term health care services, special care facility services, or any other health care services the board of directors determines are necessary to meet the needs of the district.

Revised Law

Sec. 1054.114.  PAYMENT FOR TREATMENT; PROCEDURES.  (a)  When a patient who resides in the district is admitted to a district facility, the district administrator may 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)  If the district administrator determines that the patient or those relatives cannot pay all or part of the costs of the care and treatment in the hospital, the amount of the costs that cannot be paid becomes a charge against the district.

(c)  If the district administrator determines that the patient or those relatives can 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 the district a specified amount each week for the patient's care and support.  The amount ordered must be proportionate to the person's financial ability.

(d)  The district administrator 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 administrator, the board shall hold a hearing and, after calling witnesses, shall:

(1)  resolve the dispute or doubt; and

(2)  issue any appropriate orders.

(f)  A final order of the board may be appealed to the district court.  The substantial evidence rule applies to the appeal.  (Acts 60th Leg., R.S., Ch. 66, Sec. 17.)

Source Law

Sec. 17.  Whenever a patient residing within the district has been admitted to the facilities of the district, the administrator or manager may cause inquiry to be made as to his circumstances and those of the relatives of the patient legally liable for his support.  If he finds that the patient or the relatives are able to pay for his care and treatment in whole or in part, an order shall be made directing the patient or the relatives to pay to the hospital district for the care and support of the patient a specified sum a week in proportion to their financial ability.  The administrator or manager shall have power and authority to collect the sums from the estate of the patient or his relatives legally liable for his support in the manner provided by law for collection of expenses in the last illness of a deceased person.  If the administrator or manager finds that such patient or said relatives are not able to pay either in whole or in part for his care and treatment in the hospital, same shall become a charge upon the hospital district as to the amount of the inability to pay.  Should there be any dispute as to the ability to pay or doubt in the mind of the administrator or manager, the board of directors shall hear and determine same after calling witnesses, and shall make such order or orders as may be proper.  Appeals from a final order of the board shall lie to the district court.  The substantial evidence rule shall apply.

Revised Law

Sec. 1054.115.  REIMBURSEMENT FOR SERVICE.  (a)  The board shall require a county, municipality, or public hospital located outside the district to reimburse the district for the district's care and treatment of a sick or injured person of that county, municipality, or public hospital as provided by Chapter 61, Health and Safety Code.

(b)  The board shall require the sheriff of a county or the police chief of a municipality to reimburse the district for the district's care and treatment of a person who is confined in a jail facility of the county or municipality and is not a resident of the district.  (Acts 60th Leg., R.S., Ch. 66, Secs. 5(c), (d).)

Source Law

(c)  The board of directors shall require reimbursement from a county, municipality, or public hospital located outside the boundaries of the district for the district's care and treatment of a sick, diseased, or injured person of that county, municipality, or public hospital as provided by Chapter 61, Health and Safety Code.

(d)  The board of directors shall require reimbursement from the sheriff or police chief of a county or municipality for the district's care and treatment of a person confined in a jail facility of the county or municipality who is not a resident of the district.

Revised Law

Sec. 1054.116.  AUTHORITY TO SUE AND BE SUED.  The district, through the board, may sue and be sued.  (Acts 60th Leg., R.S., Ch. 66, Sec. 5(a) (part).)

Source Law

(a)  …  [The district through its board of directors shall have the power and authority] to sue and be sued, … .

[Sections 1054.117-1054.150 reserved for expansion]

SUBCHAPTER D.  GENERAL FINANCIAL PROVISIONS

Revised Law

Sec. 1054.151.  BUDGET.  The district administrator shall prepare an annual budget for approval by the board.  (Acts 60th Leg., R.S., Ch. 66, Sec. 6 (part).)

Source Law

Sec. 6.  … The administrator or manager shall prepare an annual budget for approval by the board of directors… .

Revised Law

Sec. 1054.152.  NOTICE; HEARING; APPROVAL OF BUDGET.  (a)  The board shall hold a public hearing on the proposed annual budget.

(b)  Notice of the hearing must be published one time at least 10 days before the date of the hearing.

(c)  The board must approve the annual budget.  (Acts 60th Leg., R.S., Ch. 66, Sec. 6 (part).)

Source Law

Sec. 6.  … A public hearing on the annual budget shall be held by the board of directors after notice of the hearing has been published one time at least 10 days before the date set for the hearing… . the annual budget, and … shall be approved by the board of directors… .

Revised Law

Sec. 1054.153.  AMENDMENTS TO BUDGET.  The budget may be amended as required by circumstances.  The board must approve all amendments.  (Acts 60th Leg., R.S., Ch. 66, Sec. 6 (part).)

Source Law

Sec. 6.  … The annual budget may be amended from time to time as the circumstances may require, but [the annual budget, and] all amendments, shall be approved by the board of directors… .

Revisor's Note

Section 6, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, states that the board may amend the budget "from time to time."  The revised law omits the quoted language because the authority to amend the budget implies the authority to do so at any time.

Revised Law

Sec. 1054.154.  RESTRICTION ON EXPENDITURES.  Money may be spent only for an expense included in the budget or an amendment to the budget.  (Acts 60th Leg., R.S., Ch. 66, Sec. 6 (part).)

Source Law

Sec. 6.  … No expenditure may be made for any expense not included in the annual budget or an amendment to the annual budget… .

Revised Law

Sec. 1054.155.  FISCAL YEAR.  The district operates on a fiscal year that begins on October 1 and ends on September 30. (Acts 60th Leg., R.S., Ch. 66, Sec. 6 (part).)

Source Law

Sec. 6.  The district shall be operated on the basis of a fiscal year commencing on October 1 of each year and ending on September 30 of the following year, and … .

Revised Law

Sec. 1054.156.  AUDIT.  The board shall have an audit made of the district's financial condition.  (Acts 60th Leg., R.S., Ch. 66, Sec. 6 (part).)

Source Law

Sec. 6.  … it [the district] shall cause an audit to be made of the financial condition of the district, … .

Revised Law

Sec. 1054.157.  INSPECTION OF AUDIT AND DISTRICT RECORDS.  The audit and other district records shall be open to inspection at the district's principal office.  (Acts 60th Leg., R.S., Ch. 66, Sec. 6 (part).)

Source Law

Sec. 6.  … [the district shall cause] an audit [to be made of the financial condition of the district,] which together with other records of the district shall be open to inspection at the principal office of the district… .

Revised Law

Sec. 1054.158.  FINANCIAL REPORT.  As soon as practicable after the close of each fiscal year, the district administrator shall prepare for the board:

(1)  a complete sworn statement of all district money; and

(2)  a complete account of the disbursements of that money.  (Acts 60th Leg., R.S., Ch. 66, Sec. 6 (part).)

Source Law

Sec. 6.  … As soon as practicable after the close of each fiscal year, the administrator or manager shall prepare for the board a full sworn statement of all moneys belonging to the district and a full account of the disbursements of the money.

Revised Law

Sec. 1054.159.  DEPOSITORY.  (a)  The board shall select one or more banks in the district to serve as a depository for district money.

(b)  District money shall be immediately deposited on receipt with a depository bank, except that sufficient money must be remitted to the place or places designated as agent for the payment of principal of and interest on the district's outstanding bonds in time for the agent to make that payment on or before the maturity date of the principal and interest.

(c)  To the extent that money in a depository bank is not insured by the Federal Deposit Insurance Corporation, the money must be secured in the manner provided by law for the security of county funds.

(d)  Membership on the district's board of an officer or director of a bank does not disqualify the bank from being designated as a depository bank.  (Acts 60th Leg., R.S., Ch. 66, Sec. 11.)

Source Law

Sec. 11.  The board of directors of the district shall name one or more banks within its boundaries to serve as depository for funds of the district.  All the funds shall, as derived and collected, be immediately deposited with the depository bank or banks, except that sufficient funds shall be remitted to the place or places designated as agent for the payment of principal of and interest on the outstanding bonds of the district and in time that the money may be received by the agent or agents for payment on or prior to the date of maturity of the principal and interest so to be paid.  To the extent that funds in the depository bank or banks are not insured by the Federal Deposit Insurance Corporation, they shall be secured in the manner provided by law for security of county funds.  Membership on the board of directors of an officer or director of a bank shall not disqualify the bank from being designated as depository.

Revisor's Note

Section 11, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, refers to money "derived and collected."  The revised law substitutes "on receipt" for the quoted language because the terms are synonymous, and the former is more commonly used.

Revised Law

Sec. 1054.160.  SPENDING AND INVESTMENT RESTRICTIONS.  Except as otherwise provided by Section 1054.107(c) and by Subchapter E, the district may not incur an obligation payable from district revenue other than the revenue on hand or to be on hand in the current and immediately following district fiscal years.  (Acts 60th Leg., R.S., Ch. 66, Sec. 10 (part).)

Source Law

Sec. 10.  … Except as permitted in the preceding sentence and as permitted by Sections 7 and 8, the district may incur no obligation payable from any revenues of the district, taxes or otherwise, except those on hand or to be on hand within the then current fiscal year of the district or the fiscal year immediately following.

Revisor's Note

Section 10, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, states that "[e]xcept as permitted in the preceding sentence and as permitted by Sections 7 and 8," the district may not incur certain obligations.  The "preceding sentence" in Section 10 is codified in Section 1054.107(c).  As explained in Revisor's Note (2) at the end of Subchapter A, Section 8 is omitted from the revised law as executed.  Section 7 is codified in Subchapter E.  The revised law is drafted accordingly.

Revised Law

Sec. 1054.161.  AUTHORITY TO BORROW MONEY; SECURITY.  (a)  The board may borrow money at a rate not to exceed the maximum annual percentage rate allowed by law for district obligations at the time the loan is made if the board declares that:

(1)  money is not available to meet authorized obligations of the district; and

(2)  an emergency exists.

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

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

(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; or

(3)  district bonds that have been authorized but not sold.

(c)  A loan for which taxes or bonds are pledged must mature not later than the first anniversary of the date the loan is made.  A loan for which district revenue is pledged must mature not later than the fifth 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 or bonds are pledged to pay the loan, the purpose for which the pledged taxes were imposed or the pledged bonds were authorized.  (Acts 60th Leg., R.S., Ch. 66, Sec. 7A.)

Source Law

Sec. 7A.  (a)  If the board of directors declares that funds are not available to meet lawfully authorized obligations of the district and that an emergency exists, the board of directors may borrow money at a rate not to exceed the maximum annual percentage rate allowed by law for district obligations at the time the loan is made.

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

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

(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; or

(3)  district bonds that have been authorized but not sold.

(c)  A loan for which taxes or bonds are pledged must mature not later than the anniversary of the date on which the loan is made.  A loan for which district revenues are pledged must mature not later than the fifth anniversary of the date on which the loan is made.

(d)  The board of directors may not spend money obtained from a loan under this section for any purpose other than the purpose for which the board of directors declared an emergency and, if taxes or bonds are pledged to pay the loan, for any purpose other than the purpose for which the pledged taxes were levied or the pledged bonds were authorized.

Revisor's Note

Section 7A, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, refers to "lawfully authorized obligations."  The revised law omits "lawfully" because, in context, a "lawful" obligation is included in the meaning of an "authorized" obligation.

[Sections 1054.162-1054.200 reserved for expansion]

SUBCHAPTER E. BONDS

Revised Law

Sec. 1054.201.  GENERAL OBLIGATION BONDS.  The board may issue and sell general obligation bonds in the name and on the faith and credit of the district to:

(1)  purchase, construct, acquire, repair, or renovate buildings or improvements;

(2)  equip buildings or improvements for hospital purposes; or

(3)  acquire and operate a mobile emergency medical service.  (Acts 60th Leg., R.S., Ch. 66, Sec. 7(a) (part).)

Source Law

Sec. 7.  (a)  The board of directors shall have the power and authority to issue and to sell its bonds in the name and on the faith and credit of the hospital district for the acquisition and operation of a mobile emergency medical service and for the purchase, construction, acquisition, repair or renovation of buildings and improvements and equipping the same for hospital purposes… .

Revisor's Note

Section 7(a), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, provides that the board has the power and authority to issue and sell bonds in the name and on the faith and credit of the district.  Because the type of bonds described by Section 7(a) are known as "general obligation bonds," the revised law is drafted accordingly.

Revised Law

Sec. 1054.202.  TAX TO PAY GENERAL OBLIGATION BONDS.  (a)  At the time general obligation bonds are issued by the district under Section 1054.201, 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 the bonds 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 75 cents on each $100 valuation of all taxable property in the district.  (Acts 60th Leg., R.S., Ch. 66, Sec. 7(a) (part).)

Source Law

(a)  …  At the time of the issuance of any bonds by the district, a tax shall be levied by the board sufficient to create an interest and sinking fund to pay the interest on and principal of the bonds as they mature, providing the tax together with any other taxes levied for the district shall not exceed 75 cents on each $100 valuation of taxable property in any one year, upon all property subject to hospital district taxation within said district.

Revisor's Note

Section 7(a), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, 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. 1054.203.  REVENUE BONDS.  (a) The board may issue revenue bonds to:

(1)  purchase, construct, acquire, repair, equip, or renovate buildings or improvements for hospital purposes;

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

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

(b)  The bonds must be payable from and secured by a pledge of all or part of the revenue derived from the operation of the district's hospital system.

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

(d)  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 60th Leg., R.S., Ch. 66, Secs. 7(d), (e), (f).)

Source Law

(d)  The board of directors may issue revenue bonds to:

(1)  purchase, construct, acquire, repair, equip, or renovate buildings or improvements for hospital purposes;

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

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

(e)  The revenue bonds must be payable from and secured by a pledge of all or part of the revenues derived from the operation of the district's hospital system.  The bonds may be additionally secured by a mortgage or deed of trust lien on all or part of district property.

(f)  The revenue 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. 1054.204.  REFUNDING BONDS.  (a)  The board may issue refunding bonds to refund outstanding indebtedness.

(b)  A refunding bond may be:

(1)  sold, with the proceeds of the refunding bond applied to the payment of the outstanding indebtedness; or

(2)  exchanged wholly or partly for not less than a similar principal amount of outstanding indebtedness.  (Acts 60th Leg., R.S., Ch. 66, Sec. 7(b) (part).)

Source Law

(b)  Refunding bonds of the district may be issued for the purpose of refunding and paying off any outstanding indebtedness.  The refunding bonds may be sold and the proceeds applied to the payment of outstanding indebtedness, or may be exchanged in whole or in part for not less than a like principal amount of the outstanding indebtedness … .

Revisor's Note

(1)  Section 7(b), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, provides that refunding bonds must bear interest at the same or a lower rate than the rate of the debt refunded unless a savings is shown.  The revised law omits that provision because it has been superseded by the enactment of the maximum interest rate provision found in Section 1204.006, Government Code.  That section reflects the 1981 amendment of Chapter 3, Acts of the 61st Legislature, Regular Session, 1969 (Article 717k-2, Vernon's Texas Civil Statutes, now Chapter 1204, Government Code), by Section 1, Chapter 61, Acts of the 67th Legislature, Regular Session, 1981, and permits a public agency, including a hospital district, to issue public securities at any net effective interest rate of 15 percent or less.  Section 1204.006, Government Code, applies to bonds issued under this chapter by application of Section 1204.001, Government Code.  The omitted law reads:

(b)  … provided that, if refunding bonds are to be exchanged for a like amount of the outstanding indebtedness, the refunding bonds shall bear interest at the same or lower rate than borne by the debt refunded, unless it is shown mathematically that a saving will result in the total amount of interest to be paid on the refunding bonds, and … .

(2)  Section 7(b), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, provides that refunding bonds sold to pay outstanding indebtedness must be issued and payments made in the manner specified by "Article 717k, Revised Civil Statutes of Texas, 1925, as amended."  Article 717k was codified in 1999 as part of Chapter 1207, Government Code.  The revised law omits the provision because Chapter 1207, Government Code, applies to the district by its own terms under Section 1207.001, Government Code.  The omitted law reads:

(b)  … provided further that if the refunding bonds are to be sold and the proceeds applied to the payment of any outstanding indebtedness, same shall be issued and payments made in the manner specified by Article 717k, Revised Civil Statutes of Texas, 1925, as amended.

Revised Law

Sec. 1054.205.  MATURITY OF BONDS.  District bonds must mature not later than the 50th anniversary of the date of issuance.  (Acts 60th Leg., R.S., Ch. 66, Sec. 7(c) (part).)

Source Law

(c)  Bonds of the district … shall mature not later than the 50th anniversary of the date of their issuance, … .

Revised Law

Sec. 1054.206.  EXECUTION OF BONDS.  (a)  The board president shall execute the district's bonds in the district's name.

(b)  The board secretary shall countersign the bonds in the manner provided by Chapter 618, Government Code.  (Acts 60th Leg., R.S., Ch. 66, Sec. 7(c) (part).)

Source Law

(c)  [Bonds of the district] … shall be executed in the name of the hospital district and in its behalf by the president of the board and countersigned by the secretary in the manner provided by Chapter 204, Acts of the 57th Legislature, Regular Session, 1961 (Article 717j-1, Vernon's Texas Civil Statutes), as amended, and … .

Revisor's Note

(1)  Section 7(c), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, refers to Chapter 204, Acts of the 57th Legislature, Regular Session, 1961 (Article 717j-1, Vernon's Texas Civil Statutes), as amended.  That statute was codified in 1999 as Chapter 618, Government Code, and the revised law is drafted accordingly.

(2)  Section 7(c), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, provides in part that district bonds must bear interest at a rate that does not 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 provision 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 by its own terms by application of Section 1204.001, Government Code.  The omitted law reads:

(c)  [Bonds of the district] shall bear interest at a rate not to exceed that provided by Chapter 3, Acts of the 61st Legislature, Regular Session, 1969 (Article 717k-2, Vernon's Texas Civil Statutes), … .

(3)  Section 7(c), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, 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 7(c) also provides that after approval and registration 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:

(c)  [Bonds of the district] … shall be subject to the same requirements in the matter of approval by the Attorney General of Texas and registration by the Comptroller of Public Accounts of the State of Texas as are by law provided for approval and registration of bonds issued by counties.  On the approval of the bonds by the attorney general and registration by the comptroller, the bonds shall be incontestable for any cause.

Revised Law

Sec. 1054.207.  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)  the transfer and issuance of the bonds; and

(3)  profits made in the sale of the bonds.  (Acts 60th Leg., R.S., Ch. 66, Sec. 20 (part).)

Source Law

Sec. 20.  … any bonds issued by it [the district] together with their transfer and issuance, including any profits made in the sale of the bonds, shall at all times be free from taxation by the State or any municipality or political subdivision.

Revisor's Note

Section 20, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, refers to "any municipality or political subdivision" of this state.  The revised law omits "municipality" because that term is included in the meaning of "political subdivision" of this state.

Revisor's Note

(End of Subchapter)

(1)  Section 13, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, 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 13 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 savings and loan associations are regulated by Sections 63.002 and 64.001, Finance Code.  As to the remaining entities listed, Section 13 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).  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. 13.  All bonds issued by the district shall be and are hereby declared to be legal and authorized investments of banks, savings banks, trust companies, building and loan associations, savings and loan associations, insurance companies, fiduciaries, trustees, and sinking funds of cities, towns, villages, counties, school districts, or other political subdivisions of the State of Texas, and for all public funds of the State of Texas or its agencies, including the state permanent school fund… .

(2)  Section 13, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, effectively provides that district bonds may secure deposits of public funds of this state or political subdivisions of this state.  The revised law omits the provisions 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. 13.  … The bonds shall be eligible to secure deposit of public funds of the State of Texas and public funds of cities, towns, villages, counties, school districts or other political subdivisions or corporations of the State of Texas, and shall be lawful and sufficient security for the deposits to the extent of their value when accompanied by all unmatured coupons.

[Sections 1054.208-1054.250 reserved for expansion]

SUBCHAPTER F.  TAXES

Revised Law

Sec. 1054.251.  IMPOSITION OF AD VALOREM TAX.  (a)  The board may impose a tax on all property in the district subject to district taxation.

(b)  The board shall impose the tax to pay:

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

(2)  the maintenance and operating expenses of the district.

(c)  The district may not impose a tax to pay the principal of or interest on revenue bonds issued under this chapter.  (Acts 60th Leg., R.S., Ch. 66, Secs. 12 (part), 15(a) (part), (b), (c).)

Source Law

Sec. 12.  The board of directors shall annually levy a tax … for the purpose of paying (1) the indebtedness issued by the district and (2) the maintenance and operating expenses of the district… .

Sec. 15.  (a)  The board of directors annually may impose property taxes … of all taxable property in the district.

(b)  The taxes may be used to pay:

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

(2)  the maintenance and operating expenses of the district.

(c)  The district may not impose taxes to pay the principal of or interest on revenue bonds issued under this Act.

Revised Law

Sec. 1054.252.  TAX RATE.  (a)  The board may impose the tax at a rate not to exceed the limit approved by the voters at the election authorizing the imposition of the tax.

(b)  The tax rate for all purposes may not exceed 75 cents on each $100 valuation of all taxable property in the district.

(c)  In setting the tax rate, the board shall consider the income of the district from sources other than taxation.  (Acts 60th Leg., R.S., Ch. 66, Secs. 12 (part), 15(a) (part).)

Source Law

Sec. 12.  [The board of directors shall annually levy a tax] of not to exceed the amount hereinabove permitted … .  In setting the tax rate the board shall take into consideration the income of the district from sources other than taxation… .

Sec. 15.  (a)  [The board of directors annually may impose property taxes] in an amount not to exceed the limit approved by the voters at the election authorizing the levy of taxes.  In adopting the tax rate, the board of directors shall consider the income of the district from sources other than taxation.  The tax rate for all purposes may not exceed 75 cents on each $100 valuation of all taxable property in the district.

Revisor's Note

Section 12, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, 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. 12.  …  On determination of the amount of tax required to be levied, the board shall make the levy and certify the levy to the tax assessor-collector of the county.

Revised Law

Sec. 1054.253.  TAX ASSESSOR-COLLECTOR.  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 60th Leg., R.S., Ch. 66, Sec. 15(e).)

Source Law

(e)  The board of directors 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.

Revisor's Note

(End of Subchapter)

Section 15(d), Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, provides that the Tax Code governs the appraisal, assessment, and collection of district taxes.  The revised law omits this 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:

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

Revisor's Note

(End of Chapter)

(1)  Section 22, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, 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. 22.  If any of the provisions of this Act or the application of this Act to any person or circumstance is held invalid, the invalidity shall not affect other provisions or applications of the Act which can be given effect without the invalid provision or application, and to this end the provisions of this Act are declared to be severable.

(2)  Section 23, Chapter 66, Acts of the 60th Legislature, Regular Session, 1967, provides that public notice of enactment of the statute was provided in a manner that satisfies the requirements of the Texas Constitution.  The revised law omits this provision as executed.  The omitted law reads:

Sec. 23.  Proof of publication of the notice required in the enactment hereof under the provisions of Section 9 of Article IX of the Texas Constitution has been made in the manner and form provided by law pertaining to the enactment of local and special laws, and the notice is hereby found and declared proper and sufficient to satisfy the requirement.