TLC: Special District Local Laws Code Proposed Chapters

80C185(1) MDR

CHAPTER 1068. MULESHOE AREA HOSPITAL DISTRICT

SUBCHAPTER A. GENERAL PROVISIONS

Revised Law

Sec. 1068.001. 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 Muleshoe Area Hospital District. (Acts 71st Leg., R.S., Ch. 45, Sec. 1.01.)

Source Law

Sec. 1.01. In this Act:

(1) "District" means the Muleshoe Area Hospital District.

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

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

Revised Law

Sec. 1068.002. AUTHORITY FOR OPERATION. The Muleshoe Area Hospital District operates and is financed as provided by Section 9, Article IX, Texas Constitution, and by this chapter. (Acts 71st Leg., R.S., Ch. 45, Sec. 1.02.)

Source Law

Sec. 1.02. The Muleshoe Area Hospital District may be created and established and, if created, must be maintained, operated, and financed in the manner provided by Article IX, Section 9, of the Texas Constitution and by this Act.

Revisor's Note

Section 1.02, Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, provides that the district "may be created and established and, if created, must be maintained, operated, and financed" in the manner provided by the Texas Constitution and the act. The revised law omits "created" and "established" as executed. The revised law omits "maintained" because, in this context, the meaning of that term is included in the meaning of "operated."

Revised Law

Sec. 1068.003. ESSENTIAL PUBLIC FUNCTION. The district is a public entity performing an essential public function. (Acts 71st Leg., R.S., Ch. 45, Sec. 7.11 (part).)

Source Law

Sec. 7.11. Since the district created under this Act is a public entity performing an essential public function, … .

Revised Law

Sec. 1068.004. DISTRICT TERRITORY. The district is composed of the territory described by Section 1.03, Chapter 45, Acts of the 71st Legislature, Regular Session, 1989. (New.)

Revisor's Note

The revision of the law governing the Muleshoe Area Hospital District does not revise the statutory language describing the territory of the district to avoid the lengthy recitation of the description. For the reader's convenience, the revised law includes a reference to the statutory description of the district's territory.

Revised Law

Sec. 1068.005. DISTRICT SUPPORT AND MAINTENANCE NOT STATE OBLIGATION. The state may not become obligated for the support or maintenance of the district. (Acts 71st Leg., R.S., Ch. 45, Sec. 9.01 (part).)

Source Law

Sec. 9.01. The state may not become obligated for the support or maintenance of a hospital district created under this Act, … .

Revised Law

Sec. 1068.006. RESTRICTION ON STATE FINANCIAL ASSISTANCE. The legislature may not make a direct appropriation for the construction, maintenance, or improvement of a district facility. (Acts 71st Leg., R.S., Ch. 45, Sec. 9.01 (part).)

Source Law

Sec. 9.01. … nor may the legislature make a direct appropriation for the construction, maintenance, or improvement of a facility of the district.

Revisor's Note

(End of Subchapter)

Sections 3.01, 3.02, and 3.05-3.08, Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, 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 each authorized election, the revised law omits the provisions as executed. The omitted law reads:

Sec. 3.01. The district may be created and a tax may be authorized only if the creation and the tax are approved by a majority of the registered voters of the territory of the proposed district located in Bailey County or by a majority of the registered voters of the territory of the proposed district located in Parmer County voting at separate elections in the respective counties that are called and held for that purpose in accordance with Section 3.02 of this Act.

Sec. 3.02. (a) A majority of the temporary directors of the district may order the separate creation elections to be held.

(b) On presentation of a petition for the creation elections signed by at least 10 percent of the registered voters of the territory of the proposed district, according to the most recent official lists of registered voters, the temporary directors shall order the elections to be held. The elections shall be called not later than the 60th day after the date the petition is presented to the district.

(c) The election orders must call for an election to be held in the territory included in Bailey County and a separate election to be held in the territory included in Parmer County with both elections to be held on the same day.

Sec. 3.05. (a) The elections shall be held on the same day and not less than 45 days nor more than 60 days after the date on which the elections are ordered.

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

Sec. 3.06. The ballot for the elections at which the issuance of bonds is not proposed shall be printed to permit voting for or against the proposition: "The creation of the Muleshoe Area Hospital District and the levy of annual taxes for hospital purposes at a rate not to exceed 25 cents on each $100 valuation of all taxable property in the district."

Sec. 3.07. (a) The temporary directors of the district shall meet and canvass the returns of the elections.

(b) If the temporary directors find that the election results of either election are favorable to the proposition to create the district, they shall issue an order declaring the district created and shall set the boundaries to include the territory included in each county in which the vote was favorable.

(c) If the temporary directors find that the election results of both elections are not favorable to the proposition to create the district, the district is not created and additional creation elections may not be held before the first anniversary of the date of the elections at which voters disapproved the proposition.

Sec. 3.08. If the creation of the district is not approved at an election held within 60 months after the effective date of this Act, this Act expires.

[Sections 1068.007-1068.050 reserved for expansion]

SUBCHAPTER B. DISTRICT ADMINISTRATION

Revised Law

Sec. 1068.051. BOARD ELECTION; TERM. (a) The district is governed by a board of five directors elected by place.

(b) Unless four-year terms are established under Section 285.081, Health and Safety Code:

(1) directors serve staggered two-year terms; and

(2) an election shall be held on the uniform election date in May of each year to elect the appropriate number of directors. (Acts 71st Leg., R.S., Ch. 45, Secs. 4.01(a), 4.03(a), (d) (part).)

Source Law

Sec. 4.01. (a) The district is governed by a board of five directors.

Sec. 4.03. (a) Members of the board of directors shall be elected by place.

(d) … an election shall be held on the first Saturday in May of each year, and the appropriate number of successor directors shall be elected for two-year terms.

Revisor's Note

(1) Section 4.01(b), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, provides for temporary directors to serve until elected directors take office. The revised law omits the provision as executed. The omitted law reads:

(b) From the time the creation of the district is approved until the elected directors take office, the temporary directors serve as directors of the district.

(2) Sections 4.02 and 4.03(d), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, prescribe the procedures for electing the initial board. The revised law omits the provisions as executed. The omitted law reads:

Sec. 4.02. [Initial] Directors shall be elected at an election to be held on the first Saturday in May that occurs after the 12th month after the date on which the district is created.

[Sec. 4.03]

(d) After the initial election of directors, … .

(3) Section 4.03(b), Chapter 45, Acts of the 71th Legislature, Regular Session, 1989, provides that the candidate receiving the highest number of votes for a place is a director. The revised law omits the provision because it duplicates Section 2.001, Election Code, which provides that, except as otherwise provided by law, to be elected to a public office a candidate must receive more votes than any other candidate for the office. The omitted law reads:

(b) The candidate for a place receiving the highest number of votes for election to that place is a director for the district.

(4) Section 4.03(c), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, prescribes the terms of the initial directors and, in doing so, establishes staggered two-year terms for the directors. The revised law omits the specific provision relating to the terms of the initial directors as executed but revises the establishment of a board consisting of five directors serving staggered two-year terms. The omitted law reads:

(c) Those directors elected to fill even-numbered places at the initial election serve for a term of two years and those elected to fill odd-numbered places at the initial election of directors serve for a term of one year.

(5) Section 4.03(d), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, requires board elections to be held 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 that the election be held on the first Saturday in May, which was the uniform election date in May.

(6) Section 4.03(d), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, provides that directors serve two-year terms. Section 285.081, Health and Safety Code, applicable to this district, provides a mechanism by which the governing board of a hospital district, on its own motion, may order that directors are to be elected in even-numbered years to serve staggered four-year terms. The revised law is drafted accordingly and adds a reference to Section 285.081, Health and Safety Code, for the convenience of the reader.

Revised Law

Sec. 1068.052. NOTICE OF ELECTION. At least 35 days before the date of an election of directors, notice of the election shall be published one time in a newspaper with general circulation in the district. (Acts 71st Leg., R.S., Ch. 45, Sec. 4.04.)

Source Law

Sec. 4.04. At least 35 days before the date of an election of directors, notice of the election shall be published one time in a newspaper with general circulation in the district.

Revised Law

Sec. 1068.053. 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:

(1) be signed by at least 25 registered voters of the district as determined by the most recent official list of registered voters;

(2) be filed not later than the 31st day before the date of the election; and

(3) specify the place for which the person is to be a candidate. (Acts 71st Leg., R.S., Ch. 45, Sec. 4.05.)

Source Law

Sec. 4.05. (a) A person who wishes to have his name printed on the ballot as a candidate for director must file with the secretary of the board of directors a petition signed by at least 25 registered voters of the district asking that his name be placed on the ballot. The determination of whether a person is a registered voter of the district shall be based on the most recent official lists of registered voters.

(b) The petition must be filed with the secretary not later than the 31st day before the date of the election.

Revised Law

Sec. 1068.054. 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 71st Leg., R.S., Ch. 45, Sec. 4.06.)

Source Law

Sec. 4.06. (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) An employee of the district may not serve as a director.

Revised Law

Sec. 1068.055. BOARD VACANCY. If a vacancy occurs in the office of director, the remaining directors shall appoint a director for the unexpired term. (Acts 71st Leg., R.S., Ch. 45, Sec. 4.07.)

Source Law

Sec. 4.07. A vacancy in the office of director shall be filled for the unexpired term by appointment by the remaining directors.

Revised Law

Sec. 1068.056. OFFICERS. (a) The board shall elect a president and a vice president from among its members.

(b) The board shall appoint a secretary, who need not be a director.

(d) The board shall fill a vacancy in a board office for the unexpired term. (Acts 71st Leg., R.S., Ch. 45, Secs. 4.08, 4.09.)

Source Law

Sec. 4.08. The board shall elect from among its members a president and a vice-president. The board shall also appoint a secretary. The secretary need not be a director.

Sec. 4.09. (a) Each officer of the board serves for a term of one year.

(b) The board shall fill a vacancy in a board office for the unexpired term.

Revised Law

Sec. 1068.057. COMPENSATION; EXPENSES. A director or officer serves without compensation but 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 71st Leg., R.S., Ch. 45, Sec. 4.10.)

Source Law

Sec. 4.10. Directors and officers serve without compensation but may be reimbursed for actual expenses incurred in the performance of official duties. Those expenses must be reported in the district's minute book or other district records and must be approved by the board.

Revisor's Note

Section 4.10, Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, requires that district 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. 1068.058. VOTING REQUIREMENT. A concurrence of a majority of the directors voting is necessary in any matter relating to district business. (Acts 71st Leg., R.S., Ch. 45, Sec. 4.11.)

Source Law

Sec. 4.11. A concurrence of a majority of the members of the board voting is necessary in matters relating to the business of the district.

Revised Law

Sec. 1068.059. DISTRICT ADMINISTRATOR. (a) The board may appoint a qualified person as district administrator.

(b) The district administrator serves at the will of the board and is entitled to the compensation determined by the board.

(c) Before assuming the duties of district administrator, the administrator must execute a bond in the amount determined by the board of not less than $5,000 that is:

(1) payable to the district; and

(2) conditioned on the faithful performance of the administrator's duties under this chapter.

(d) The board may pay for the bond with district money. (Acts 71st Leg., R.S., Ch. 45, Secs. 4.12(a) (part), (b) (part), (c) (part), (d).)

Source Law

Sec. 4.12. (a) The board may appoint qualified persons as administrator of the district, … .

(b) The administrator, … serve at the will of the board.

(d) Before assuming his duties, the administrator shall execute a bond payable to the hospital district in the amount of not less than $5,000 as determined by the board, conditioned on the faithful performance of his duties under this Act. The board may pay for the bond with district funds.

Revised Law

Sec. 1068.060. 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 general affairs of the district. (Acts 71st Leg., R.S., Ch. 45, Sec. 4.15.)

Source Law

Sec. 4.15. The administrator shall supervise the work and activities of the district and shall direct the general affairs of the district, subject to the limitations prescribed by the board.

Revised Law

Sec. 1068.061. ASSISTANT DISTRICT ADMINISTRATOR; ATTORNEY. (a) The board may appoint qualified persons as:

(1) the assistant district administrator; and

(2) the attorney for the district.

(b) The assistant district administrator and the attorney for the district serve at the will of the board and are entitled to the compensation determined by the board. (Acts 71st Leg., R.S., Ch. 45, Secs. 4.12(a) (part), (b) (part), (c) (part).)

Source Law

Sec. 4.12. (a) The board may appoint qualified persons as … assistant administrator, and attorney for the district.

(b) The … assistant administrator, and attorney serve at the will of the board.

Revised Law

Sec. 1068.062. APPOINTMENT OF STAFF AND EMPLOYEES. (a) The board may appoint to the staff any doctors the board considers necessary for the efficient operation of the district and may make temporary appointments as necessary.

(b) The district may employ technicians, nurses, fiscal agents, accountants, architects, additional attorneys, and other necessary employees.

(c) The board may delegate to the district administrator the authority to employ persons for the district. (Acts 71st Leg., R.S., Ch. 45, Secs. 4.13, 4.14.)

Source Law

Sec. 4.13. The board may appoint to the staff any doctors it considers necessary for the efficient operation of the district and may make temporary appointments as considered necessary.

Sec. 4.14. (a) The district may employ technicians, nurses, fiscal agents, accountants, architects, additional attorneys, and other necessary employees.

(b) The board may delegate to the administrator the authority to employ persons for the district.

Revised Law

Sec. 1068.063. 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 71st Leg., R.S., Ch. 45, Sec. 4.16.)

Source Law

Sec. 4.16. The board may provide retirement benefits for employees of the district by establishing or administering a retirement program or by 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.

Revisor's Note

(End of Subchapter)

Sections 2.01 and 2.02, Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, refer to the appointment of temporary directors of the district and vacancies in the office of temporary director. The revised law omits the provisions as executed. The omitted law reads:

Sec. 2.01. On the effective date of this Act, the following persons become temporary directors of the district:

(1) Tim Campbell;

(2) Darrell L. Jennings;

(3) Neal Caswell;

(4) Vance Wagnon; and

(5) Robert E. Finney.

Sec. 2.02. The directors remaining after a vacancy in the office of temporary director shall fill the vacancy by appointment by majority vote.

[Sections 1068.064-1068.100 reserved for expansion]

SUBCHAPTER C. POWERS AND DUTIES

Revised Law

Sec. 1068.101. DISTRICT RESPONSIBILITY. The district has full responsibility for:

(1) operating hospital facilities; and

(2) providing medical and hospital care for the district's needy inhabitants. (Acts 71st Leg., R.S., Ch. 45, Sec. 5.02 (part).)

Source Law

Sec. 5.02. On creation of the district, the district:

(1) assumes full responsibility for operating hospital facilities and for furnishing medical and hospital care for the district's needy inhabitants;

… .

Revisor's Note

Section 5.02, Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, provides that "[o]n creation of the district," the district "assumes" certain responsibilities. The revised law omits "[o]n creation of the district," as executed. The revised law substitutes "has" for "assumes" because the obligation to assume the responsibility is executed.

Revised Law

Sec. 1068.102. RESTRICTION ON COUNTY TAXATION AND DEBT. Bailey and Parmer Counties may not impose a tax or issue bonds or other obligations for hospital purposes or to provide medical care for district residents. (Acts 71st Leg., R.S., Ch. 45, Sec. 5.01(b).)

Source Law

(b) On or after creation of the district, Bailey and Parmer counties may not levy taxes or issue bonds or other obligations for hospital purposes or for providing medical care for the residents of the district.

Revisor's Note

Section 5.01(b), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, provides that "[o]n or after creation of the district," Bailey and Parmer Counties 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.

Revised Law

Sec. 1068.103. MANAGEMENT, CONTROL, AND ADMINISTRATION. The board shall manage, control, and administer the hospital system and the district's money and resources. (Acts 71st Leg., R.S., Ch. 45, Sec. 5.03.)

Source Law

Sec. 5.03. The board shall manage, control, and administer the hospital system and the funds and resources of the district.

Revised Law

Sec. 1068.104. RULES. The board may adopt rules governing:

(1) the operation of the hospital and hospital system; and

(2) the duties, functions, and responsibilities of district staff and employees. (Acts 71st Leg., R.S., Ch. 45, Sec. 5.04.)

Source Law

Sec. 5.04. The board may adopt rules governing the operation of the hospital and hospital system and the duties, functions, and responsibilities of district staff and employees.

Revised Law

Sec. 1068.105. PURCHASING AND ACCOUNTING PROCEDURES. The board may prescribe:

(1) the method of making purchases and expenditures by and for the district; and

(2) accounting and control procedures for the district. (Acts 71st Leg., R.S., Ch. 45, Sec. 5.05.)

Source Law

Sec. 5.05. (a) The board may prescribe the method of making purchases and expenditures by and for the district.

(b) The board may prescribe accounting and control procedures for the district.

Revised Law

Sec. 1068.106. MOBILE EMERGENCY MEDICAL SERVICE. The district may operate or provide for the operation of a mobile emergency medical service. (Acts 71st Leg., R.S., Ch. 45, Sec. 5.02 (part).)

Source Law

Sec. 5.02. … the district:

…

(3) may operate or provide for the operation of a mobile emergency medical service.

Revised Law

Sec. 1068.107. DISTRICT PROPERTY, FACILITIES, AND EQUIPMENT. (a) The board shall determine:

(1) the type, number, and location of buildings required to maintain an adequate hospital system; and

(2) the type of equipment necessary for hospital care.

(b) The board may:

(1) acquire property, including facilities and equipment, for the district for use in the hospital system; and

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

(d) The board may sell or otherwise dispose of property, including facilities or equipment, for the district. (Acts 71st Leg., R.S., Ch. 45, Sec. 5.06.)

Source Law

Sec. 5.06. (a) The board shall determine the type, number, and location of buildings required to establish and maintain an adequate hospital system and the type of equipment necessary for hospital care.

(b) The board may acquire property, facilities, and equipment for the district for use in the hospital system and may mortgage or pledge the property, facilities, or equipment acquired as security for the payment of the purchase price.

(d) The board may sell or otherwise dispose of property, facilities, or equipment on behalf of the district.

Revisor's Note

Section 5.06(a), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, 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.

Revised Law

Sec. 1068.108. EMINENT DOMAIN. (a) The district may exercise the power of eminent domain to acquire a fee simple or other interest in property located in district territory if the interest is necessary to exercise a right or authority 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.

(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 71st Leg., R.S., Ch. 45, Sec. 5.09.)

Source Law

Sec. 5.09. (a) The district may exercise the power of eminent domain to acquire by condemnation a fee simple or other interest in property located in the territory of the district if the property interest is necessary to the exercise of the rights or authority conferred by this Act.

(b) The district must exercise the power of eminent domain in the manner provided by Chapter 21, Property Code, but 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 pay in advance or give bond or other security for costs in the trial court, to give bond for the issuance of a temporary restraining order or a temporary injunction, or to give bond for costs or supersedeas on an appeal or writ of error.

Revised Law

Sec. 1068.109. COST OF RELOCATING OR ALTERING PROPERTY. In exercising the power of eminent domain, if the board requires relocating, raising, lowering, rerouting, changing the grade of, or altering the construction of any railroad, highway, pipeline, or electric transmission and electric distribution, telegraph, or telephone line, conduit, pole, or facility, the district must bear the actual cost of relocating, raising, lowering, rerouting, changing the grade, or altering the construction to provide comparable replacement without enhancement of facilities, after deducting the net salvage value derived from the old facility. (Acts 71st Leg., R.S., Ch. 45, Sec. 5.10.)

Source Law

Sec. 5.10. In exercising the power of eminent domain, if the board requires relocating, raising, lowering, rerouting, changing the grade, or altering the construction of any railroad, highway, pipeline, or electric transmission and electric distribution, telegraph, or telephone lines, conduits, poles, or facilities, the district must bear the actual cost of relocating, raising, lowering, rerouting, changing the grade, or altering the construction to provide comparable replacement without enhancement of facilities, after deducting the net salvage value derived from the old facility.

Revised Law

Sec. 1068.110. GIFTS AND ENDOWMENTS. The board may accept for the district a gift or endowment to be held in trust for any purpose and under any direction, limitation, or other provision prescribed in writing by the donor that is consistent with the proper management of the district. (Acts 71st Leg., R.S., Ch. 45, Sec. 5.14.)

Source Law

Sec. 5.14. On behalf of the district, the board may accept gifts and endowments to be held in trust for any purpose and under any direction, limitation, or provision prescribed in writing by the donor that is consistent with the proper management of the district.

Revised Law

Sec. 1068.111. 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 provided by Section 271.024, Local Government Code, only after competitive bidding as provided by Subchapter B, Chapter 271, Local Government Code. (Acts 71st Leg., R.S., Ch. 45, Sec. 5.07(a).)

Source Law

Sec. 5.07. (a) The board may enter into construction contracts on behalf of the district; however, the board 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

(1) Section 5.07(a), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, 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.

(2) Section 5.07(b), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, provides that Article 5160, Revised Statutes, applies to the district's construction contracts in relation to performance and payment bonds. The revised law omits the provision because Article 5160 was codified as Chapter 2253, Government Code, and that chapter applies to hospital districts on its own terms. The omitted law reads:

(b) Article 5160, Revised Statutes, as it relates to performance and payment bonds, applies to construction contracts let by the district.

Revised Law

Sec. 1068.112. OPERATING AND MANAGEMENT CONTRACTS. The board may enter into an operating or management contract relating to a hospital facility for the district. (Acts 71st Leg., R.S., Ch. 45, Sec. 5.08.)

Source Law

Sec. 5.08. The board may enter into operating or management contracts relating to hospital facilities on behalf of the district.

Revised Law

Sec. 1068.113. CONTRACTS WITH GOVERNMENTAL ENTITIES FOR SERVICES. 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. (Acts 71st Leg., R.S., Ch. 45, Sec. 5.13.)

Source Law

Sec. 5.13. The board may contract with a city, county, special district, or other political subdivision of the state or with a state or federal agency for the district to furnish a mobile emergency medical service or to provide for the investigatory or welfare needs of inhabitants of the district.

Revisor's Note

Section 5.13, Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, refers to "a city, county, special district, or other political subdivision of the state." Throughout this chapter, the revised law omits references to "city," "county," and "special district" in this context because each of those entities is included in the meaning of "political subdivision of the state."

Revised Law

Sec. 1068.114. 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 financial circumstances of:

(1) the patient; or

(2) a relative of the patient who is legally responsible 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) On determining that the patient or a relative legally responsible for the patient's support can pay for all or part of the care and treatment provided by the district, the district administrator shall report that determination to the board, and the board shall issue an order directing the patient or the relative to pay the district a specified amount each week. The amount must be based on the individual's ability to pay.

(d) The district administrator may collect money owed to the district from the patient's estate or from that of a relative legally responsible for the patient's support in the manner provided by law for collection of expenses of the last illness of a deceased person.

(e) If there is a dispute relating to an individual's ability to pay or if the district administrator has any doubt concerning an individual's ability to pay, the board shall:

(1) call witnesses;

(2) hear and resolve the question; and

(3) issue a final order.

(f) A final order of the board may be appealed to a district court in the county in which the district is located. The substantial evidence rule applies to the appeal. (Acts 71st Leg., R.S., Ch. 45, Secs. 5.11(a), (c), (d), (e), (f).)

Source Law

Sec. 5.11. (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) The administrator of the district may have an inquiry made into the financial circumstances of any patient residing in the district and admitted to a district facility and into the financial circumstances of a relative of the patient who is legally responsible for the patient's support.

(d) On finding that the patient or a relative of the patient legally responsible for the patient's support can pay for all or any part of the care and treatment provided by the district, the administrator shall report that finding to the board, and the board shall issue an order directing the patient or the relative to pay the district each week a specified amount that the individual is able to pay.

(e) The administrator may collect money owed to the district from the estate of the patient or from that of a relative who was legally responsible for the patient's support in the manner provided by law for collection of expenses in the last illness of a deceased person.

(f) If there is a dispute relating to an individual's ability to pay or if the administrator has any doubt concerning an individual's ability to pay, the board shall call witnesses, hear and resolve the question, and issue a final order. An appeal from a final order of the board must be made to a district court in the county in which the district is located and the substantial evidence rule applies.

Revisor's Note

Section 5.11(b), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, requires the district to adopt an application procedure for assistance eligibility. The revised law omits the provision because it duplicates provisions in 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 10.03, Indigent Health Care and Treatment Act (Article 4438f, Vernon's Texas Civil Statutes).

Revised Law

Sec. 1068.115. REIMBURSEMENT FOR SERVICES. (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 Bailey County to reimburse the district for the district's care and treatment of a person who is confined in a jail facility of Bailey County and is not a district resident.

(c) The board may contract with the state or federal government for that government to reimburse the district for treatment of a sick or injured person. (Acts 71st Leg., R.S., Ch. 45, Sec. 5.12.)

Source Law

Sec. 5.12. (a) The board shall require reimbursement from a county, city, 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, city, or public hospital as provided by the Indigent Health Care and Treatment Act (Article 4438f, Vernon's Texas Civil Statutes).

(b) The board shall require reimbursement from the sheriff of Bailey County for the district's care and treatment of a person confined in a jail facility of Bailey County who is not a resident of the district.

(c) The board may contract with the state or federal government for the state or federal government to reimburse the district for treatment of a sick, diseased, or injured person.

Revisor's Note

(1) Section 5.12(a), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, refers to a "city." The revised law substitutes "municipality" for "city" because that is the term used in the Local Government Code.

(2) Sections 5.12(a) and (c), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, refer to a "sick, diseased, or injured person." The revised law omits the references to "diseased" because it is included in the meaning of "sick."

(3) Section 5.12(a), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, refers to the Indigent Health Care and Treatment Act (Article 4438f, Vernon's Texas Civil Statutes). That statute was codified in 1989 as Chapter 61, Health and Safety Code. The revised law is drafted accordingly.

Revised Law

Sec. 1068.116. AUTHORITY TO SUE AND BE SUED. The board may sue and be sued on behalf of the district. (Acts 71st Leg., R.S., Ch. 45, Sec. 5.15.)

Source Law

Sec. 5.15. The board may sue and be sued on behalf of the district.

[Sections 1068.117-1068.150 reserved for expansion]

SUBCHAPTER D. GENERAL FINANCIAL PROVISIONS

Revised Law

Sec. 1068.151. BUDGET. (a) The district administrator shall prepare a proposed annual budget for the district.

(b) The proposed budget must contain a complete financial statement, including a statement of:

(1) the outstanding obligations of the district;

(2) the amount of cash on hand in each district fund;

(3) the amount of money received by the district from all sources during the previous year;

(4) the amount of money available to the district from all sources during the ensuing year;

(5) the amount of the balances expected at the end of the year in which the budget is being prepared;

(6) the estimated amount of revenue and balances available to cover the proposed budget; and

(7) the estimated tax rate required. (Acts 71st Leg., R.S., Ch. 45, Sec. 6.04.)

Source Law

Sec. 6.04. (a) The administrator of the district shall prepare a proposed annual budget for the district.

(b) The proposed budget must contain a complete financial statement, including a statement of:

(1) the outstanding obligations of the district;

(2) the amount of cash on hand to the credit of each fund of the district;

(3) the amount of money received by the district from all sources during the previous year;

(4) the amount of money available to the district from all sources during the ensuing year;

(5) the amount of the balances expected at the end of the year in which the budget is being prepared;

(6) the estimated amount of revenues and balances available to cover the proposed budget; and

(7) the estimated tax rate that will be required.

Revised Law

Sec. 1068.152. NOTICE; HEARING; ADOPTION OF BUDGET. (a) The board shall hold a public hearing on the proposed annual budget.

(b) The board shall publish notice of the hearing in a newspaper with general circulation in the district not later than the 10th day before the date of the hearing.

(d) At the conclusion of the hearing, the board shall adopt a budget by acting on the budget proposed by the district administrator. The board may make any changes in the proposed budget that the board judges to be in the interests of the taxpayers.

(e) The budget is effective only after adoption by the board. (Acts 71st Leg., R.S., Ch. 45, Sec. 6.05.)

Source Law

Sec. 6.05. (a) The board shall hold a public hearing on the proposed annual budget.

(b) The board shall publish notice of the hearing in a newspaper of general circulation in the district not later than the 10th day before the date of the hearing.

(d) At the conclusion of the hearing, the board shall adopt a budget by acting on the budget proposed by the administrator. The board may make any changes in the proposed budget that in its judgment the interests of the taxpayers demand.

(e) The budget is effective only after adoption by the board.

Revised Law

Sec. 1068.153. AMENDMENTS TO BUDGET. After the annual budget is adopted, the budget may be amended on the board's approval. (Acts 71st Leg., R.S., Ch. 45, Sec. 6.06.)

Source Law

Sec. 6.06. After adoption, the annual budget may be amended on the board's approval.

Revised Law

Sec. 1068.154. RESTRICTION ON EXPENDITURES. Money may be spent only for an expense included in the budget or an amendment to the budget. (Acts 71st Leg., R.S., Ch. 45, Sec. 6.07.)

Source Law

Sec. 6.07. Money may not be spent for an expense not included in the annual budget or an amendment to it.

Revised Law

Sec. 1068.155. FISCAL YEAR. (a) The district operates according to a fiscal year established by the board.

(b) The fiscal year may not be changed:

(1) during a period that revenue bonds of the district are outstanding; or

(2) more than once in a 24-month period. (Acts 71st Leg., R.S., Ch. 45, Sec. 6.01.)

Source Law

Sec. 6.01. (a) The district operates on the fiscal year established by the board.

(b) The fiscal year may not be changed when revenue bonds of the district are outstanding or more than once in a 24-month period.

Revised Law

Sec. 1068.156. ANNUAL AUDIT. The board annually shall have an audit made of the district's financial condition. (Acts 71st Leg., R.S., Ch. 45, Sec. 6.02.)

Source Law

Sec. 6.02. Annually, the board shall have an audit made of the financial condition of the district.

Revised Law

Sec. 1068.157. INSPECTION OF ANNUAL AUDIT AND DISTRICT RECORDS. The annual audit and other district records are open to inspection during regular business hours at the district's principal office. (Acts 71st Leg., R.S., Ch. 45, Sec. 6.03.)

Source Law

Sec. 6.03. The annual audit and other district records are open to inspection during regular business hours at the principal office of the district.

Revised Law

Sec. 1068.158. FINANCIAL REPORT. As soon as practicable after the close of the fiscal year, the district administrator shall prepare for the board:

(1) a sworn statement of the amount of district money; and

(2) an account of the disbursements of that money. (Acts 71st Leg., R.S., Ch. 45, Sec. 6.08.)

Source Law

Sec. 6.08. As soon as practicable after the close of the fiscal year, the administrator shall prepare for the board a sworn statement of the amount of money that belongs to the district and an account of the disbursements of that money.

Revised Law

Sec. 1068.159. DEPOSITORY. (a) The board shall select at least one bank to serve as a depository for district money.

(b) District money, other than money invested as provided by Section 1068.160(b) and money transmitted to a bank for payment of bonds or obligations issued or assumed by the district, shall be deposited as received with the depository bank and must remain on deposit. This subsection does not limit the power of the board to place a part of district money on time deposit or to purchase certificates of deposit.

(c) The district may not deposit money with a bank in an amount that exceeds the maximum amount secured by the Federal Deposit Insurance Corporation unless the bank first executes a bond or other security in an amount sufficient to secure from loss the district money that exceeds the amount secured by the Federal Deposit Insurance Corporation. (Acts 71st Leg., R.S., Ch. 45, Sec. 6.10.)

Source Law

Sec. 6.10. (a) The board shall name at least one bank to serve as depository for district funds.

(b) District funds, other than those invested as provided by Section 6.09(b) of this Act and those transmitted to a bank of payment for bonds or obligations issued or assumed by the district, shall be deposited as received with the depository bank and must remain on deposit. This subsection does not limit the power of the board to place a portion of district funds on time deposit or to purchase certificates of deposit.

(c) Before the district deposits funds in a bank in an amount that exceeds the maximum amount secured by the Federal Deposit Insurance Corporation, the bank must execute a bond or other security in an amount sufficient to secure from loss the district funds that exceed the amount secured by the Federal Deposit Insurance Corporation.

Revised Law

Sec. 1068.160. SPENDING AND INVESTMENT RESTRICTIONS. (a) Except as provided by Sections 1068.111, 1068.201, 1068.204, and 1068.205, the district may not incur a debt payable from district revenue other than the revenue on hand or to be on hand in the current and immediately following district fiscal years.

(b) The board may invest operating, depreciation, or building reserves only in funds or securities specified by Chapter 2256, Government Code. (Acts 71st Leg., R.S., Ch. 45, Sec. 6.09.)

Source Law

Sec. 6.09. (a) Except as provided by Sections 5.07(a), 7.01, 7.04, and 7.05 of this Act, the district may not incur a debt payable from revenues of the district other than the revenues on hand or to be on hand in the current and immediately following fiscal year of the district.

(b) The board may invest operating, depreciation, or building reserves only in funds or securities specified by Article 836 or 837, Revised Statutes.

Revisor's Note

Section 6.09(b), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, refers to "Article 836 or 837, Revised Statutes." Those articles were impliedly repealed by the enactment of the Public Funds Investment Act of 1987 (Article 842a-2, Vernon's Texas Civil Statutes), which was codified in 1993 as Chapter 2256, Government Code. Chapter 2256, Government Code, defines "local government" to include hospital districts and applies to the district by its own terms. The revised law therefore substitutes a reference to Chapter 2256, Government Code, for the references to Articles 836 and 837.

[Sections 1068.161-1068.200 reserved for expansion]

SUBCHAPTER E. BONDS

Revised Law

Sec. 1068.201. GENERAL OBLIGATION BONDS. The board may issue and sell general obligation bonds authorized by an election 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 71st Leg., R.S., Ch. 45, Sec. 7.01.)

Source Law

Sec. 7.01. The board may issue and sell bonds authorized by an election in the name and on the faith and credit of the hospital 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.

Revisor's Note

Section 7.01, Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, 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 7.01 are known as "general obligation bonds," the revised law is drafted accordingly.

Revised Law

Sec. 1068.202. TAX TO PAY GENERAL OBLIGATION BONDS. (a) At the time general obligation bonds are issued by the district under Section 1068.201, 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 the limit approved by the voters at the election authorizing the imposition of the tax. (Acts 71st Leg., R.S., Ch. 45, Sec. 7.02.)

Source Law

Sec. 7.02. (a) At the time the bonds are issued by the district, the board shall levy a tax.

(b) The tax must be sufficient to create an interest and sinking fund to pay the principal of and interest on the bonds as they mature.

(c) In any year, the tax together with any other tax the district levies may not exceed the limit approved by the voters at the election authorizing the levy of taxes.

Revisor's Note

Section 7.02, Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, 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. 1068.203. 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 a bond election.

(1) the nature and date of the election;

(2) the hours during which the polls will be open;

(3) the location of the polling places;

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

(5) the maximum maturity of the bonds.

(d) Notice of a bond election shall be given as provided by Section 1251.003, Government Code.

(e) The board shall declare the results of the election. (Acts 71st Leg., R.S., Ch. 45, Sec. 7.03.)

Source Law

Sec. 7.03. (a) The district may issue general obligation bonds only if the bonds are authorized by a majority of the qualified voters of the district voting at an election called and held for that purpose.

(b) The board may order a bond election. The order calling the election must state the nature and date of the election, the hours during which the polls will be open, the location of the polling places, the amount of bonds to be authorized, and the maximum maturity of the bonds.

(d) The board shall canvass the returns and declare the results of the election.

Revisor's Note

(1) Section 7.03(a), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, refers to a majority vote of the "qualified" voters of the district. The revised law omits "qualified" as unnecessary in this context because Chapter 11, Election Code, governs eligibility to vote in an election in this state and allows only "qualified" voters who are residents of the territory covered by the election to vote in an election.

(2) Section 7.03(a), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, 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.

(3) Section 7.03(c), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, refers to Article 704, Revised Statutes, which specifies certain notice requirements for a bond election. That provision was codified in 1999 as Section 1251.003, Government Code. The revised law is drafted accordingly.

(4) Section 7.03(d), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, provides that "[t]he board shall canvass the returns" of a bond 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.

Revised Law

Sec. 1068.204. REVENUE BONDS. (a) The board may issue revenue bonds to:

(1) purchase, construct, acquire, repair, renovate, or equip 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.

(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 71st Leg., R.S., Ch. 45, Sec. 7.04.)

Source Law

Sec. 7.04. (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 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.

(c) The bonds must be issued in the manner provided by Sections 8, 10, 11, 12, and 13, County Hospital Authority Act (Article 4494r, Vernon's Texas Civil Statutes), for issuance of revenue bonds by county hospital authorities.

Revisor's Note

Section 7.04(c), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, refers to Sections 8, 10, 11, 12, and 13, County Hospital Authority Act (Article 4494r, Vernon's Texas Civil Statutes). Those provisions were codified in 1989 as Sections 264.042, 264.043, and 264.046-264.049, Health and Safety Code. The revised law is drafted accordingly.

Revised Law

Sec. 1068.205. REFUNDING BONDS. (a) The board may issue refunding bonds to refund outstanding indebtedness issued or assumed by the district.

(b) Refunding bonds may be:

(1) sold, with the proceeds of the refunding bonds 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 71st Leg., R.S., Ch. 45, Secs. 7.05(a), (c) (part).)

Source Law

Sec. 7.05. (a) Refunding bonds of the district may be issued to refund and pay off an outstanding indebtedness the district has issued or assumed.

(c) 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 similar principal amount of outstanding indebtedness… .

Revisor's Note

Sections 7.05(b) and (c), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, require the district to issue refunding bonds in the manner prescribed by Article 717k-3 (Vernon's Texas Civil Statutes), and, for refunding bonds that will be sold, to issue the bonds and to make payments on the bonds in the manner prescribed by Article 717k (Vernon's Texas Civil Statutes). Articles 717k and 717k-3 were codified in 1999 as Chapter 1207, Government Code. The revised law omits the provisions because Chapter 1207, Government Code, applies to the district by its own terms under Section 1207.001, Government Code. The omitted law reads:

(b) The bonds must be issued in the manner provided by Chapter 784, Acts of the 61st Legislature, Regular Session, 1969 (Article 717k-3, Vernon's Texas Civil Statutes).

(c) … If the refunding bonds are to be sold and the proceeds applied to the payment of outstanding indebtedness, the refunding bonds must be issued and payments made in the manner provided by Chapter 503, Acts of the 54th Legislature, Regular Session, 1955 (Article 717k, Vernon's Texas Civil Statutes).

Revised Law

Sec. 1068.206. MATURITY OF BONDS. District bonds must mature not later than 50 years after the date of issuance. (Acts 71st Leg., R.S., Ch. 45, Sec. 7.06 (part).)

Source Law

Sec. 7.06. District bonds must mature not more than 50 years after the date of their issuance and … .

Revisor's Note

Section 7.06, Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, provides that district bonds must 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). The revised law omits the 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 on its own terms under Section 1204.001, Government Code. The omitted law reads:

Sec. 7.06. [District bonds] … must 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).

Revised Law

Sec. 1068.207. 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 71st Leg., R.S., Ch. 45, Sec. 7.07.)

Source Law

Sec. 7.07. The president of the board shall execute the bonds in the name of the district, and the secretary of the board shall countersign the bonds in the manner provided by the Texas Uniform Facsimile Signature of Public Officials Act (Article 717j-1, Vernon's Texas Civil Statutes).

Revisor's Note

Section 7.07, Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, refers to the Texas Uniform Facsimile Signature of Public Officials Act (Article 717j-1, Vernon's Texas Civil Statutes). That statute was codified in 1999 as Chapter 618, Government Code, and the revised law is drafted accordingly.

Revised Law

Sec. 1068.208. 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 71st Leg., R.S., Ch. 45, Sec. 7.11 (part).)

Source Law

Sec. 7.11. … bonds issued by the district, any transaction relating to the bonds, and profits made in the sale of the bonds are free from taxation by the state or by any city, county, special district, or other political subdivision of the state.

Revisor's Note

(End of Subchapter)

(1) Section 7.08, Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, provides that district bonds are subject to the laws governing counties that relate to bond approval by the attorney general and registration of the bonds by the comptroller. Section 7.08 also provides that after approval and registration the bonds are "incontestable for any cause." The revised law omits these provisions because they duplicate, in substance, Chapter 1202, Government Code. Section 1202.003(a), Government Code, requires that bonds 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. 7.08. (a) District bonds are subject to the same requirements with regard to approval by the attorney general and registration by the comptroller of public accounts as the law provides for approval and registration of bonds issued by counties.

(b) On approval by the attorney general and registration by the comptroller of public accounts, the bonds are incontestable for any cause.

(2) Section 7.09, Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, provides that district bonds are legal and authorized investments for certain entities. The revised law omits that provision as unnecessary. As to several of the entities listed, Section 7.09 has been superseded and impliedly repealed or it duplicates existing law. 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 7.09 duplicates Section 1201.041, Government Code (enacted as Section 9, Bond Procedures Act of 1981 (Article 717k-6, Vernon's Texas Civil Statutes)). While Section 7.09 lists "guardians" and Section 1201.041 does not, the later statute includes "fiduciaries," 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 and last amended in 2003)), 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. 7.09. District bonds and indebtedness assumed by the district are legal and authorized investments for:

(1) banks;

(2) savings banks;

(3) trust companies;

(4) savings and loan associations;

(5) insurance companies;

(6) fiduciaries;

(7) trustees;

(8) guardians; and

(9) sinking funds of cities, counties, school districts, and other political subdivisions of the state and other public funds of the state and its agencies, including the permanent school fund.

(3) Section 7.10, Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, provides that district bonds may secure deposits of public funds of this state or political subdivisions of this state. 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. As to deposits of other funds, the provision duplicates Chapter 2257, Government Code, which governs eligible collateral for deposits of funds of other public agencies, including political subdivisions. The omitted law reads:

Sec. 7.10. District bonds are eligible to secure deposits of public funds of the state and of cities, counties, school districts, and other political subdivisions of the state. The bonds are lawful and sufficient security for deposits to the extent of their value if accompanied by all unmatured coupons.

[Sections 1068.209-1068.250 reserved for expansion]

SUBCHAPTER F. TAXES

Revised Law

Sec. 1068.251. IMPOSITION OF AD VALOREM TAX. (a) The board may impose a tax on all property in the district subject to district taxation.

(b) The tax may be used 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 71st Leg., R.S., Ch. 45, Secs. 8.02(a) (part), (c), (d), 8.03(b).)

Source Law

Sec. 8.02. (a) The board may annually levy taxes … .

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

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

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

[Sec. 8.03]

(b) The board shall levy taxes on all property in the district subject to hospital district taxation.

Revised Law

Sec. 1068.252. 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 71st Leg., R.S., Ch. 45, Secs. 8.02(a) (part), (b), 8.04 (part).)

Source Law

Sec. 8.02. (a) [The board may annually levy taxes] in an amount not to exceed the limit approved by the voters at the election authorizing the levy of taxes.

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

Sec. 8.04. In setting the tax rate, the board shall take into consideration the income of the district from sources other than taxation. …

Revisor's Note

Section 8.04, Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, 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. 8.04. … On determination of the amount of tax required to be levied, the board shall make the levy and certify it to the tax assessor-collector.

Revised Law

Sec. 1068.253. ELECTION TO INCREASE MAXIMUM TAX RATE. (a) The board may order an election to increase the district's maximum ad valorem tax rate.

(b) 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.

(c) The board shall give notice of the election 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. The first publication must appear at least 35 days before the date set for the election.

(d) The ballot for the election must be printed to permit voting for or against the proposition: "The levy of annual taxes by the board of directors of the Muleshoe Area Hospital District for hospital purposes at a rate not to exceed ____ cents on each $100 valuation of all taxable property in the district subject to hospital district taxation."

(e) If the board finds that the election results favor the proposition, the board may impose taxes as authorized by the proposition. If the board finds that the election results do not favor the proposition, another election on raising the district's maximum tax rate may not be held before the first anniversary of the date of the most recent election at which voters disapproved the proposition.

(f) Section 41.001(a), Election Code, does not apply to an election ordered under this section. (Acts 71st Leg., R.S., Ch. 45, Secs. 3.03, 3.04, 8.01(a) (part), (b), (c) (part), (d).)

Source Law

Sec. 3.03. The orders calling each 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.

Sec. 3.04. The temporary directors shall give notice of the elections by publishing a substantial copy of each election order in a newspaper with general circulation in the proposed district once a week for two consecutive weeks. The first publication must appear at least 35 days before the date set for the elections.

Sec. 8.01. (a) At any time after the district is created, the board may order an election on the question of increasing the maximum tax rate. … Except as otherwise provided by this subsection, the election shall be ordered and notice of the election shall be given in the same manner as provided by Sections 3.03 and 3.04 of this Act for ordering and giving notice of an election authorizing creation of the district.

(b) The ballot for the election must be printed to permit voting for or against the proposition: "The levy of annual taxes by the board of directors of the Muleshoe Area Hospital District for hospital purposes at a rate not to exceed ____ cents on each $100 valuation on all taxable property in the district subject to hospital district taxation."

(c) … If the board finds that the election results are favorable to the proposition, the board may levy taxes as authorized by the proposition. If the board finds that the election results are not favorable to the proposition, another election on the question of raising the district's maximum tax rate may not be held before the first anniversary of the most recent election at which voters disapproved the proposition.

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

Revisor's Note

(1) Section 8.01(a), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, provides that "[a]t any time after the district is created," the board may order an election to raise the maximum tax rate. The revised law omits the quoted language as executed.

(2) Section 8.01(a), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, states that the election must be held not less than 45 days or more than 60 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:

Sec. 8.01. (a) … The election shall be held not less than 45 days nor more than 60 days after the date on which the election is ordered. …

(3) Section 8.01(c), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, requires the board to meet and canvass the election returns. The revised law omits this provision for the reason stated in Revisor's Note (4) to Section 1068.203. The omitted law reads:

Revised Law

Sec. 1068.254. 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 71st Leg., R.S., Ch. 45, Sec. 8.05(b).)

Source Law

(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.

Revisor's Note

Section 8.05(a), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, provides 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:

Sec. 8.05. (a) The Tax Code governs the appraisal, assessment, and collection of district taxes.

Revisor's Note

(End of Subchapter)

Section 8.03(a), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, provides that the board may levy taxes for the entire year in which the district is created. The revised law omits that provision as executed. The omitted law reads:

Sec. 8.03. (a) The board may levy taxes for the entire year in which the district is created.

Revisor's Note

(End of Chapter)

Sections 5.01(a) and 5.02(2), Chapter 45, Acts of the 71st Legislature, Regular Session, 1989, require Bailey and Parmer Counties to transfer certain funds, reserves, 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. 5.01. (a) On creation of the district, Bailey and Parmer counties shall convey or transfer to the district:

(1) operating funds and reserves for operating expenses and funds that have been budgeted by Bailey and Parmer counties to provide medical care for residents of the district for the remainder of the fiscal year in which the district is established;

(2) taxes levied by Bailey and Parmer counties to provide medical care for residents of the district for the year in which the district is created; and

(3) funds established for payment of indebtedness assumed by the district.

Sec. 5.02. [On creation of the district, the district:]

…

(2) assumes any outstanding indebtedness incurred by Bailey and Parmer counties in providing hospital care for residents of the territory of the district before the district's creation; and

… .


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