TLC: Special District Local Laws Code Proposed Chapters

81C15(3) CBH

CHAPTER 1088. REAGAN HOSPITAL DISTRICT OF REAGAN

COUNTY, TEXAS

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 1088.001. DEFINITIONS ............................... 4

Sec. 1088.002. AUTHORITY FOR CREATION .................... 4

Sec. 1088.003. ESSENTIAL PUBLIC FUNCTION ................. 4

Sec. 1088.004. DISTRICT TERRITORY ........................ 4

Sec. 1088.005. CORRECTION OF INVALID PROCEDURES .......... 5

Sec. 1088.006. DISTRICT SUPPORT AND MAINTENANCE NOT

STATE OBLIGATION ........................ 6

Sec. 1088.007. RESTRICTION ON STATE FINANCIAL

ASSISTANCE .............................. 6

[Sections 1088.008-1088.050 reserved for expansion]

SUBCHAPTER B. DISTRICT ADMINISTRATION

Sec. 1088.051. BOARD ELECTION; TERMS ..................... 8

Sec. 1088.052. NOTICE OF ELECTION ........................ 11

Sec. 1088.053. QUALIFICATIONS FOR OFFICE ................. 11

Sec. 1088.054. BOARD VACANCY ............................. 12

Sec. 1088.055. OFFICERS .................................. 12

Sec. 1088.056. VOTING REQUIREMENT ........................ 13

Sec. 1088.057. DIRECTOR PARTICIPATION IN GROUP HEALTH

INSURANCE ............................... 13

Sec. 1088.058. DISTRICT ADMINISTRATOR; ASSISTANT

DISTRICT ADMINISTRATORS ................. 14

Sec. 1088.059. GENERAL DUTIES OF DISTRICT

ADMINISTRATOR ........................... 14

Sec. 1088.060. APPOINTMENT AND DISMISSAL OF STAFF AND

EMPLOYEES; CONTRACT WITH DOCTORS ........ 15

Sec. 1088.061. RECRUITMENT OF MEDICAL STAFF AND

EMPLOYEES ............................... 15

Sec. 1088.062. EDUCATIONAL PROGRAMS; COURSES ............. 16

Sec. 1088.063. SENIORITY; RETIREMENT BENEFITS ............ 16

[Sections 1088.064-1088.100 reserved for expansion]

SUBCHAPTER C. POWERS AND DUTIES

Sec. 1088.101. DISTRICT RESPONSIBILITY ................... 18

Sec. 1088.102. RESTRICTION ON POLITICAL SUBDIVISION

TAXATION AND DEBT ....................... 19

Sec. 1088.103. MANAGEMENT, CONTROL, AND ADMINISTRATION ... 20

Sec. 1088.104. HOSPITAL SYSTEM ........................... 20

Sec. 1088.105. RULES ..................................... 21

Sec. 1088.106. PURCHASING AND ACCOUNTING PROCEDURES ...... 22

Sec. 1088.107. DISTRICT PROPERTY, FACILITIES, AND

EQUIPMENT ............................... 22

Sec. 1088.108. EMINENT DOMAIN ............................ 24

Sec. 1088.109. COST OF RELOCATING OR ALTERING PROPERTY ... 26

Sec. 1088.110. GIFTS AND ENDOWMENTS ...................... 26

Sec. 1088.111. CONSTRUCTION CONTRACTS .................... 27

Sec. 1088.112. OPERATING AND MANAGEMENT CONTRACTS ........ 28

Sec. 1088.113. CONTRACTS WITH GOVERNMENTAL ENTITIES

FOR HOSPITAL TREATMENT .................. 28

Sec. 1088.114. CONTRACTS WITH GOVERNMENTAL ENTITIES

FOR INVESTIGATORY OR OTHER SERVICES ..... 29

Sec. 1088.115. PAYMENT FOR TREATMENT; PROCEDURES ......... 29

Sec. 1088.116. NONPROFIT CORPORATION ..................... 31

Sec. 1088.117. AUTHORITY TO SUE AND BE SUED .............. 32

[Sections 1088.118-1088.150 reserved for expansion]

SUBCHAPTER D. GENERAL FINANCIAL PROVISIONS

Sec. 1088.151. BUDGET .................................... 32

Sec. 1088.152. NOTICE; HEARING; ADOPTION OF BUDGET ....... 33

Sec. 1088.153. AMENDMENTS TO BUDGET ...................... 34

Sec. 1088.154. RESTRICTION ON EXPENDITURES ............... 34

Sec. 1088.155. FISCAL YEAR ............................... 34

Sec. 1088.156. ANNUAL AUDIT .............................. 35

Sec. 1088.157. INSPECTION OF AUDIT AND DISTRICT

RECORDS ................................. 35

Sec. 1088.158. FINANCIAL REPORT .......................... 35

Sec. 1088.159. DEPOSITORY ................................ 36

Sec. 1088.160. SPENDING AND INVESTMENT RESTRICTIONS ...... 36

[Sections 1088.161-1088.200 reserved for expansion]

SUBCHAPTER E. BONDS

Sec. 1088.201. GENERAL OBLIGATION BONDS .................. 37

Sec. 1088.202. TAX TO PAY GENERAL OBLIGATION BONDS ....... 37

Sec. 1088.203. GENERAL OBLIGATION BOND ELECTION .......... 38

Sec. 1088.204. MATURITY OF GENERAL OBLIGATION BONDS ...... 39

Sec. 1088.205. EXECUTION OF GENERAL OBLIGATION BONDS ..... 39

Sec. 1088.206. REVENUE BONDS ............................. 41

Sec. 1088.207. BONDS EXEMPT FROM TAXATION ................ 41

[Sections 1088.208-1088.250 reserved for expansion]

SUBCHAPTER F. TAXES

Sec. 1088.251. IMPOSITION OF AD VALOREM TAX .............. 44

Sec. 1088.252. TAX RATE .................................. 45

Sec. 1088.253. TAX ASSESSOR-COLLECTOR .................... 46

[Sections 1088.254-1088.300 reserved for expansion]

SUBCHAPTER G. DISSOLUTION

Sec. 1088.301. DISSOLUTION; ELECTION ..................... 47

Sec. 1088.302. NOTICE OF ELECTION ........................ 49

Sec. 1088.303. BALLOT .................................... 49

Sec. 1088.304. ELECTION RESULTS .......................... 49

Sec. 1088.305. TRANSFER, SALE, OR ADMINISTRATION OF

ASSETS .................................. 50

Sec. 1088.306. SALE OR TRANSFER OF ASSETS AND

LIABILITIES ............................. 51

Sec. 1088.307. IMPOSITION OF TAX AND RETURN OF SURPLUS

TAXES ................................... 52

Sec. 1088.308. REPORT; DISSOLUTION ORDER ................. 53

CHAPTER 1088. REAGAN HOSPITAL DISTRICT OF REAGAN

COUNTY, TEXAS

SUBCHAPTER A. GENERAL PROVISIONS

Revised Law

Sec. 1088.001. 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 Reagan Hospital District of Reagan County, Texas. (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. 1088.002. AUTHORITY FOR CREATION. The Reagan Hospital District of Reagan County, Texas, is created under the authority of Section 9, Article IX, Texas Constitution. (Acts 65th Leg., R.S., Ch. 29, Sec. 1.)

Source Law

Sec. 1. By authority of Article IX, Section 9, of the Texas Constitution, this Act authorizes the creation of Reagan Hospital District of Reagan County, Texas.

Revised Law

Sec. 1088.003. ESSENTIAL PUBLIC FUNCTION. The district performs an essential public function in carrying out the purposes of this chapter. (Acts 65th Leg., R.S., Ch. 29, Sec. 22 (part).)

Source Law

Sec. 22. In carrying out the purposes of this Act, the district will be performing an essential public function and … .

Revised Law

Sec. 1088.004. DISTRICT TERRITORY. The boundaries of the district are coextensive with the boundaries of the Reagan County Independent School District of Reagan County, as those boundaries existed on March 24, 1977. (Acts 65th Leg., R.S., Ch. 29, Sec. 2.)

Source Law

Sec. 2. The boundaries of this district are coterminous with the boundaries of the Reagan County Independent School District, located in Reagan County, as those boundaries are fixed on the effective date of this Act.

Revisor's Note

Section 2, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, refers to the boundaries of the Reagan County Independent School District "on the effective date of this Act." The act took effect on March 24, 1977, and the revised law is drafted accordingly.

Revised Law

Sec. 1088.005. CORRECTION OF INVALID PROCEDURES. If a court holds that any procedure under this chapter violates the constitution of this state or of the United States, the district by resolution may provide an alternative procedure that conforms with the constitution. (Acts 65th Leg., R.S., Ch. 29, Sec. 23 (part).)

Source Law

Sec. 23. … [federal or state constitutions] … . If any procedure in this Act is held by a court to violate either constitution, the district has the power by resolution to provide an alternative procedure conformable with the constitutions… .

Revisor's Note

Section 23, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, provides that the act does not violate the federal or state constitution and requires that action under the act comply with the constitutions. The revised law omits the reference to the federal constitution because, under the Supremacy Clause of the United States Constitution (Clause 2, Article VI), federal law always takes precedence over a state statute. The revised law also omits the reference to the Texas Constitution because the state cannot modify constitutional requirements by statute. The omitted law reads:

Sec. 23. Nothing in this Act may be construed to violate any provision of the federal or state constitutions, and all acts done under this Act shall be in such manner as will conform to them, whether expressly provided or not… .

Revised Law

Sec. 1088.006. 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 65th Leg., R.S., Ch. 29, 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, … .

Revised Law

Sec. 1088.007. RESTRICTION ON STATE FINANCIAL ASSISTANCE. The legislature may not make a direct appropriation for the construction, maintenance, or improvement of a district facility. (Acts 65th Leg., R.S., Ch. 29, 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)

Section 4, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, provides procedures for holding an election on the creation of the district, the imposition of an ad valorem tax, and the assumption of certain existing facilities and debt. Section 8(b), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, provides for the election to include a proposition authorizing the district to issue bonds. 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. 4. (a) The district shall not be created, nor shall any property be transferred to it, nor shall any tax by it be authorized until the creation and the tax are approved by a majority of the 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 directors or shall be called by a majority of the temporary directors on presentation of a petition signed by at least 50 electors of the area of the proposed district. The election shall be held not less than 25 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. The election order may provide that the entire district shall constitute one election precinct or the county election precincts within the district may be combined for elections. Notice of election shall be given by publishing a substantial copy of the election order in a newspaper or newspapers which individually or collectively provide general circulation in the district once a week for two consecutive weeks, the first publication to appear at least 30 days before the date established for the election. The failure of the election does not operate to prohibit the calling and holding of subsequent elections for the same purpose, provided, no district confirmation election may be held within 12 months of any preceding election for confirmation. If this district is not confirmed within 60 months from the effective date of this Act, this Act is repealed.

(b) At the election there shall be submitted to the electors of the area of the proposed district the proposition of whether the hospital district shall be created with authority to have transferred to it the existing hospital facilities of Reagan County and any city or town in the district, including the city of Big Lake, and to levy annual taxes … for the purpose of meeting the requirements of the district's bonds, indebtedness assumed by it, and its maintenance and operating expenses. A majority of the electors voting at the election in favor of the proposition is sufficient for its adoption.

(c) The form of ballot used at the election on the creation of the district shall be in conformity with Section 61, Texas Election Code, as amended (Article 6.05, Vernon's Texas Election Code), so that ballots may be cast "FOR" or "AGAINST" the following ballot proposition: "The creation of the Reagan Hospital District of Reagan County, Texas, providing for the levy of a tax not to exceed 75 cents on each $100 valuation, upon all taxable property situated within the district, subject to hospital district taxation, for all hospital district purposes, and providing for the assumption by the district of all city, town, or county hospital facilities and outstanding bonds and indebtedness issued for hospital purposes by Reagan County or any city or town in the district, including the city of Big Lake."

(d) Within 10 days after the election is held, the temporary directors of the district shall convene and canvass the returns of the election, and if a majority of the electors voting at the election are in favor of the proposition, the directors shall find and declare the hospital district created.

[Sec. 8]

(b) A separate proposition on the request of the temporary directors may be submitted at the election for the confirmation of the district as to whether the board of directors, in the event the district is created, shall be authorized to issue bonds for the purposes specified in this section. The proposition, if submitted, shall specify the purpose for which the bonds are to be issued, the maximum amount of bonds then proposed to be issued, the maximum maturity date, and the maximum interest rate.

[Sections 1088.008-1088.050 reserved for expansion]

SUBCHAPTER B. DISTRICT ADMINISTRATION

Revised Law

Sec. 1088.051. BOARD ELECTION; TERMS. (a) The board consists of six directors elected as follows:

(1) one director elected from each commissioners precinct of Reagan County; and

(2) two directors elected from the district at large.

(b) A redistricting or other change in the boundaries of the commissioners precincts of Reagan County does not affect the service or term of a director in office when the change occurs. The change in the commissioners precincts applies to each election of directors occurring after the change takes effect as the terms of directors then in office expire.

(d) An election shall be held on the uniform election date in May of each year to elect the appropriate number of directors. (Acts 65th Leg., R.S., Ch. 29, Secs. 5(a) (part), (b), (e) (part).)

Source Law

Sec. 5. (a) The board of directors consists of six members with one director elected from each commissioners precinct of Reagan County and two directors elected from the district at large. … The directors serve three-year staggered terms. …

(b) A redistricting or other change in the boundaries of the commissioners precincts of Reagan County does not affect the service or term of a member of the district's board of directors in office when the change occurs. The change in the commissioners precincts applies to each election of directors occurring after the change takes effect as the terms of directors then in office expire.

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

Revisor's Note

(1) Section 5(a), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, requires each director to execute the constitutional oath of office. The revised law omits that provision because Section 1, Article XVI, Texas Constitution, requires all officers in this state to take the oath (or affirmation) before assuming office. The omitted law reads:

(a) … Each permanent director and the director's successor in office shall qualify by executing the constitutional oath of office.

(2) Section 5(e), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, was amended in 2001 to require 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 expressed in the 2001 amendment to Section 5(e) that the election be held on the first Saturday in May, which was at that time the uniform election date in May.

(3) Section 5(e), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, provides that the board shall order the election of directors in accordance with Chapter 3, Election Code. The revised law omits that provision because Chapter 3 applies to the district by its own terms under Section 1.002, Election Code. The omitted law reads:

(e) [A regular election] … shall be ordered by the board in accordance with the applicable provisions of Chapter 3, Election Code… .

(4) Section 12(a), Chapter 434, Acts of the 77th Legislature, Regular Session, 2001, provides for the election of certain directors and the staggering of their terms to accomplish the change in the manner in which the members are elected and of the members' terms from two to three years. The revised law omits that provision as executed. The omitted law reads:

Sec. 12. (a) Before the date a person may file for a place on the ballot for election to the board of directors of the Reagan Hospital District of Reagan County, Texas, in 2002, the board shall establish staggered terms for the director positions and determine which director positions will be elected by place and which positions will be elected at-large. In establishing staggered terms for directors after the effective date of this Act, the board may provide for the term of a director then in office to continue as necessary until the first election after the effective date of this Act for that director position.

(5) Sections 12(b) and (c), Chapter 434, Acts of the 77th Legislature, Regular Session, 2001, validate board elections held and governmental acts and proceedings that occurred "before the effective date of this Act." The revised law omits the provisions as executed. The omitted law reads:

(b) The election of the members of the Board of Directors of the Reagan Hospital District of Reagan County, Texas, and any governmental acts and proceedings of the district occurring before the effective date of this Act are validated as of the dates they occurred. The elections, acts, and proceedings may not be held invalid because they were not performed in accordance with law.

(1) is involved in litigation if the litigation ultimately results in the matter being held invalid by a final judgment of a court of competent jurisdiction; or

(2) has been held invalid by a final judgment of a court of competent jurisdiction.

Revised Law

Sec. 1088.052. NOTICE OF ELECTION. Notice of an election of directors shall be published one time in a newspaper of general circulation in the district in accordance with Chapter 4, Election Code. (Acts 65th Leg., R.S., Ch. 29, Sec. 5(e) (part).)

Source Law

(e) … Notice of the election shall be published in a newspaper of general circulation in the district one time in accordance with Chapter 4, Election Code… .

Revised Law

Sec. 1088.053. QUALIFICATIONS FOR OFFICE. (a) A person may not be elected or appointed as a director unless the person is:

(1) a resident of the district; and

(2) a qualified voter.

(b) A director elected from a commissioners precinct is not required to be a resident of that commissioners precinct. (Acts 65th Leg., R.S., Ch. 29, Secs. 5(a) (part), (c).)

Source Law

(a) … A director elected from a commissioners precinct is not required to be a resident of that commissioners precinct… .

(c) No person may be appointed or elected as a member of the board of directors of the hospital district unless the person is a resident of the district and a qualified voter.

Revised Law

Sec. 1088.054. BOARD VACANCY. (a) If a vacancy occurs in the office of director, the remaining directors shall appoint a director to hold office for the remainder of the unexpired term.

(b) If the number of directors is reduced to fewer than five, 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 resident, shall order the election. (Acts 65th Leg., R.S., Ch. 29, Sec. 5(d) (part).)

Source Law

(d) … All vacancies in the office of director shall be filled for the unexpired term by appointment by the remainder of the board of directors and each appointee holds office for the unexpired term for which the person was appointed. If the number of directors is reduced to less than five, the remaining directors shall immediately call a special election to fill the vacancies, and upon their failure to do so, the district court, on application of any resident of the district, shall order the election.

Revised Law

Sec. 1088.055. 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 by vote shall fill a vacancy in a board office for the unexpired term. (Acts 65th Leg., R.S., Ch. 29, Sec. 5(d) (part).)

Source Law

(d) The board of directors shall organize by electing one of their number as president, one of their number as vice-president, and a secretary, who need not be a director. Officers are elected for a term of one year and vacancies shall be filled for the unexpired term by vote of the board… .

Revised Law

Sec. 1088.056. VOTING REQUIREMENT. A concurrence of four directors is sufficient in any matter relating to district business. (Acts 65th Leg., R.S., Ch. 29, Sec. 5(d) (part).)

Source Law

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

Revisor's Note

Section 5(d), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, 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) … Any four members of the board of directors constitute a quorum and … .

Revised Law

Sec. 1088.057. DIRECTOR PARTICIPATION IN GROUP HEALTH INSURANCE. The directors may participate in any group health insurance plan sponsored by the district for district employees. (Acts 65th Leg., R.S., Ch. 29, Sec. 6(n).)

Source Law

(n) The directors may participate in any group health insurance plan sponsored by the district for district employees.

Revised Law

Sec. 1088.058. DISTRICT ADMINISTRATOR; ASSISTANT DISTRICT ADMINISTRATORS. (a) The board may appoint a qualified person as district administrator.

(b) The board may appoint assistant administrators.

(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 65th Leg., R.S., Ch. 29, Sec. 6(d) (part).)

Source Law

(d) The board of directors may appoint a qualified person to be known as the administrator of the hospital district and may in its discretion appoint assistants to the administrator. The administrator and assistant administrator, if any, serve at the will of the board and receive compensation fixed by the board. The administrator shall, on assuming the duties of administrator, execute a bond payable to the hospital district in an amount set by the board of directors, not less than $5,000, conditioned on performance of the duties required of the administrator, and containing other conditions as the board may require. The board may pay for the bond with district funds. …

Revised Law

Sec. 1088.059. 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 65th Leg., R.S., Ch. 29, Sec. 6(d) (part).)

Source Law

(d) … The administrator 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. 1088.060. APPOINTMENT AND DISMISSAL OF STAFF AND EMPLOYEES; CONTRACT WITH DOCTORS. (a) The board may appoint to or dismiss from the staff or contract with 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 fiscal agents, accountants, architects, and attorneys the board considers proper.

(c) The board may delegate to the district administrator the authority to hire district employees, including technicians and nurses. (Acts 65th Leg., R.S., Ch. 29, Secs. 6(e), (f), 17.)

Source Law

[Sec. 6]

(e) The board of directors shall have the authority to appoint, dismiss from the staff, or contract with doctors as it deems necessary for the efficient operation of the district, and may provide for temporary appointments to the staff if warranted by circumstances.

(f) The board may delegate to the administrator the authority to employ technicians, nurses, and employees of the district.

Sec. 17. The district may employ fiscal agents, accountants, architects, and attorneys as the board considers proper.

Revised Law

Sec. 1088.061. RECRUITMENT OF MEDICAL STAFF AND EMPLOYEES. The board may spend district money, enter into agreements, and take other necessary action to recruit physicians and other persons to serve as medical staff members or district employees, including:

(1) advertising and marketing;

(2) paying travel, recruitment, and relocation expenses;

(3) providing a loan or scholarship to a physician or a person who:

(A) is currently enrolled in health care education courses at an institution of higher education; and

(B) contractually agrees to become a district employee or medical staff member; or

(4) paying the tuition or other expenses of a full-time medical student or other student in a health occupation who:

(A) is enrolled in and is in good standing at an accredited medical school, college, or university; and

(B) contractually agrees to become a district employee or independent contractor in return for that assistance. (Acts 65th Leg., R.S., Ch. 29, Sec. 6(i).)

Source Law

(i) The board of directors may spend district funds, enter into agreements, and take other necessary action to recruit physicians and other persons to serve as medical staff members or employees of the district, including:

(1) advertising and marketing;

(2) paying travel, recruitment, and relocation expenses;

(3) providing a loan or scholarship to a physician or a person currently enrolled in health care education courses at an institution of higher education who contractually agrees to become a district employee or medical staff member; or

(4) contracting with one or more full-time medical students or other students in a health occupation, each of whom must be enrolled in and in good standing at an accredited medical school, college, or university, to pay the student's tuition or other expenses in consideration of the student's agreement to serve as an employee or independent contractor for the district.

Revised Law

Sec. 1088.062. EDUCATIONAL PROGRAMS; COURSES. The board may provide or contract for the provision of educational programs or courses for district employees and medical staff. (Acts 65th Leg., R.S., Ch. 29, Sec. 6(k).)

Source Law

(k) The board may provide or contract for the provision of educational programs or courses for employees and medical staff of the district.

Revised Law

Sec. 1088.063. SENIORITY; RETIREMENT BENEFITS. (a) The board may:

(1) adopt rules related to the seniority of district employees; and

(2) establish or administer a retirement program or elect to participate in any statewide retirement program in which the district is eligible to participate.

(b) The district may give effect to previous years of service for district employees continuously employed in the operation or management of the hospital facilities acquired from the county or a municipality when the district was created. (Acts 65th Leg., R.S., Ch. 29, Secs. 6(b), (c) (part).)

Source Law

(b) The board is given full authority to establish rules and regulations relating to seniority of employees of the district, and may establish or administer a retirement program or elect to participate in any statewide retirement program in which the district is eligible to participate.

(c) The district may give effect to previous years of service for those employees who have been continuously employed in the operation or management of the hospital facilities acquired from the county or any city or town on the creation of the district. …

Revisor's Note

(1) Section 6(b), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, refers to "rules and regulations" established by the board. The revised law omits the references to "regulations" because under Section 311.005(5), Government Code (Code Construction Act), a rule is defined to include a regulation.

(2) Section 6(c), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, refers to a "city or town." The revised law substitutes "municipality" for "city or town" to conform to the terminology of the Local Government Code.

Revisor's Note

(End of Subchapter)

(1) Section 5(e), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, states that a person must file a ballot application with the board secretary to be a candidate for director in accordance with Chapter 144, Election Code. The revised law omits the statement because Chapter 144 applies to the district by its own terms under Section 1.002, Election Code. The omitted law reads:

(e) … Any person desiring the person's name to be printed on the ballot as a candidate for director shall file an application with the secretary of the board in accordance with Chapter 144, Election Code, asking that the person's name be printed on the ballot… .

(2) Section 5(e), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, provides that a ballot application must specify the county commissioners precinct a candidate wishes to represent or specify that the candidate wishes to represent the district at large. The revised law omits the provision because it duplicates Section 141.031(a)(4)(C), Election Code, which requires a candidate to state on the ballot application the office sought by the candidate, including any place number or other distinguishing number. The omitted law reads:

(e) … The application must specify the commissioners precinct for which the person is applying to be a candidate or state that the person is applying to be a candidate for election to an at-large position.

[Sections 1088.064-1088.100 reserved for expansion]

SUBCHAPTER C. POWERS AND DUTIES

Revised Law

Sec. 1088.101. DISTRICT RESPONSIBILITY. (a) The district has full responsibility for providing hospital care for the district's indigent residents.

(b) The district shall provide all necessary hospital and medical care for the district's needy inhabitants. (Acts 65th Leg., R.S., Ch. 29, Secs. 3(a) (part), 20 (part).)

Source Law

Sec. 3. (a) … This district shall provide all necessary hospital and medical care for the needy inhabitants of the district.

Sec. 20. … The hospital district shall assume full responsibility for providing hospital care for the indigents residing within the district. …

Revisor's Note

Section 20, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, provides that the district "shall assume" full responsibility for providing hospital care for the district's indigent residents. The revised law substitutes "has" for the quoted language because the duty to assume the responsibility is executed.

Revised Law

Sec. 1088.102. RESTRICTION ON POLITICAL SUBDIVISION TAXATION AND DEBT. A political subdivision of this state, other than the district, may not impose a tax or issue bonds or other obligations for hospital purposes or to provide hospital service or medical care in the district. (Acts 65th Leg., R.S., Ch. 29, Secs. 3(a) (part), 20 (part).)

Source Law

Sec. 3. (a) … After this district is created as provided in Section 4 of this Act, no other municipality or political subdivision of this state may levy taxes or issue bonds or other obligations of indebtedness for the purpose of providing hospital service or medical care within the district. …

Sec. 20. After creation of the hospital district, no municipality or political subdivision within the boundaries of the district has the power to levy taxes or issue bonds or other obligations for hospital purposes or for providing medical care. …

Revisor's Note

(1) Sections 3(a) and 20, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, provide that after creation of the district certain political subdivisions may not levy taxes or issue bonds for the purpose of providing hospital service or medical care within the district. The revised law omits the reference to the creation of the district as executed. In addition, throughout this chapter, the revised law substitutes "impose" for "levy" because, in this context, the terms are synonymous and "impose" is more commonly used.

(2) Sections 3(a) and 20, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, refer to a "municipality or political subdivision." Throughout this chapter, the revised law omits the reference to "municipality" because "municipality" is included in the meaning of "political subdivision."

Revised Law

Sec. 1088.103. MANAGEMENT, CONTROL, AND ADMINISTRATION. The board shall manage, control, and administer the hospital system and the district's money and resources. (Acts 65th Leg., R.S., Ch. 29, Sec. 6(a) (part).)

Source Law

Sec. 6. (a) The board of directors shall manage, control, and administer the hospital system and all funds and resources of the district, but … .

Revised Law

Sec. 1088.104. HOSPITAL SYSTEM. (a) The district has the responsibility to establish a hospital or hospital system within its boundaries to provide hospital and medical care to the district's residents.

(b) The district shall provide for:

(1) the establishment of a hospital system by:

(A) purchasing, constructing, acquiring, repairing, or renovating buildings and equipment; and

(B) equipping the buildings; and

(2) the administration of the hospital system for hospital purposes and medical purposes.

(1) facilities for domiciliary care of the sick, injured, or geriatric;

(2) outpatient clinics;

(3) dispensaries;

(4) convalescent home facilities;

(5) necessary nurses;

(6) domiciliaries and training centers;

(7) blood banks;

(8) community mental health centers;

(9) research centers or laboratories; and

(10) any other facilities the board considers necessary for medical and hospital care. (Acts 65th Leg., R.S., Ch. 29, Secs. 3(a) (part), (b) (part), 10 (part).)

Source Law

Sec. 3. (a) The district authorized to be created by this Act is charged with the responsibility of establishing a hospital or a hospital system within its boundaries to furnish hospital and medical care to the residents of the district. …

(b) … The district shall provide for the establishment of a hospital system by the purchase, construction, acquisition, repair, and renovation of buildings and equipment, and equipping same, and its administration for hospital and medical care purposes. …

Sec. 10. … The hospital system may include facilities for domiciliary care of the sick, wounded, and injured, outpatient clinics, dispensaries, facilities for geriatric domiciliary care, convalescent home facilities, necessary nurses, domiciliaries and training centers, blood banks, community mental health centers, research centers or laboratories, and any other facilities deemed necessary for medical and hospital care by the directors. …

Revisor's Note

Section 10, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, refers to the care of the "sick, wounded, and injured." The revised law omits the reference to "wounded" because the meaning of "wounded" is included in the meaning of "injured."

Revised Law

Sec. 1088.105. RULES. The board may adopt rules governing the operation of the hospital, the hospital system, and the district's staff and employees. (Acts 65th Leg., R.S., Ch. 29, Sec. 6(c) (part).)

Source Law

(c) … The district, through its board of directors, shall have the power and authority … to promulgate rules governing the operation of the hospital, hospital system, its staff, and employees.

Revisor's Note

Section 6(c), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, provides that the board may "promulgate" rules to govern the district. The revised law substitutes "adopt" for "promulgate" because the terms are synonymous and the former is more commonly used.

Revised Law

Sec. 1088.106. PURCHASING AND ACCOUNTING PROCEDURES. The board may prescribe:

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

(2) all accounting and control procedures. (Acts 65th Leg., R.S., Ch. 29, Sec. 11 (part).)

Source Law

Sec. 11. The board of directors has the power to prescribe the method and manner of making purchases and expenditures by and for the hospital district, and shall also be authorized to prescribe all accounting and control procedures… .

Revised Law

Sec. 1088.107. DISTRICT PROPERTY, FACILITIES, AND EQUIPMENT. (a) The board shall determine the type, number, and location of buildings required to maintain an adequate hospital system.

(b) The board may:

(1) purchase or lease property, including facilities or equipment, for the district to use in the hospital system; and

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

(c) 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.

(d) 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. A contract entered into under this subsection must provide that the entire obligation be retired not later than the fifth anniversary of the date of the contract.

(e) 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 65th Leg., R.S., Ch. 29, Secs. 6(h), 10 (part), 11 (part).)

Source Law

[Sec. 6]

(h) The board of directors may purchase or lease property, facilities, and equipment for the district to use in the hospital system and may mortgage or pledge the property, facilities, or equipment as security for the payment of the purchase price.

Sec. 10. The board of directors is given complete discretion as to the type, number, and location of buildings required to establish and maintain an adequate 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 in the best interests of its inhabitants, provided that no lease may be for a period in excess of 25 years from the date entered. The district may 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 interests of its inhabitants.

Sec. 11. … 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, but any such contract shall provide for the entire obligation of the district to be retired within five years from the date of the contract… .

Revisor's Note

(1) Section 10, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, 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 10, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, refers to "terms and conditions." The revised law omits the reference to "conditions" because "conditions" is included in the meaning of "terms."

(3) Section 10, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, 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. 1088.108. 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, 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 petition for review. (Acts 65th Leg., R.S., Ch. 29, Sec. 15(a).)

Source Law

Sec. 15. (a) The district has 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, 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 bond or deposits in the registry of the trial court as required by Section 21.021, Property Code. 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 15(a), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, 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 15(a), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, 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 15(a), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, refers to a "writ of error." The revised law substitutes "petition for review" for "writ of error" because, effective September 1, 1997, the Texas Supreme Court replaced the writ of error procedure with the petition for review procedure. See Rule 53.1, Texas Rules of Appellate Procedure.

Revised Law

Sec. 1088.109. 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, electric transmission and distribution, telegraph or telephone line, conduit, pole, or facility, or pipeline, 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 65th Leg., R.S., Ch. 29, Sec. 15(b).)

Source Law

(b) If the board requires the relocation, raising, lowering, rerouting, or change in grade or alteration in the construction of any railroad, electric transmission and distribution, telegraph or telephone lines, conduits, poles, or facilities, or pipelines in the exercise of the power of eminent domain, all of the relocation, raising, lowering, rerouting or changes in grade or alteration of construction due to the exercise of the power of eminent domain shall be the sole expense of the district. The term "sole expense" means the actual cost of relocation, raising, lowering, rerouting, or change in grade or alteration of construction to provide comparable replacement without enhancement of facilities, after deducting the net salvage value derived from the old facility.

Revised Law

Sec. 1088.110. GIFTS AND ENDOWMENTS. The board may accept for the district a gift or endowment to be held in trust and administered by the board for 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 65th Leg., R.S., Ch. 29, Sec. 19.)

Source Law

Sec. 19. 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 purposes and under directions, limitations, and provisions prescribed in writing by the donor which are not inconsistent with proper management and objectives of the hospital district.

Revisor's Note

Section 19, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, 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. 1088.111. CONSTRUCTION CONTRACTS. A construction contract in excess of the amount provided by Section 271.024, Local Government Code, may be made only after competitive bidding as provided by Subchapter B, Chapter 271, Local Government Code. (Acts 65th Leg., R.S., Ch. 29, Sec. 11 (part).)

Source Law

Sec. 11. … All contracts for construction in excess of the amount provided by Section 271.024, Local Government Code, may be made only after competitive bidding in the manner provided by Subchapter B, Chapter 271, Local Government Code… .

Revisor's Note

Section 11, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, provides that Chapter 2253, Government Code, applies to the district's construction contracts in relation to performance and payment bonds. The revised law omits the provision because Chapter 2253 applies to hospital districts on its own terms. The omitted law reads:

Sec. 11. … The provisions of Chapter 2253, Government Code, relating to performance and payment bonds, applies to construction contracts let by the district. …

Revised Law

Sec. 1088.112. OPERATING AND MANAGEMENT CONTRACTS. The board may enter into an operating or management contract relating to a district facility. (Acts 65th Leg., R.S., Ch. 29, Sec. 10 (part).)

Source Law

Sec. 10. … The district, through its board of directors, is authorized to enter into an operating or management contract with regard to its facilities or a part of them, or … .

Revised Law

Sec. 1088.113. CONTRACTS WITH GOVERNMENTAL ENTITIES FOR HOSPITAL TREATMENT. (a) The board may contract with a county or municipality located outside the district's boundaries for the hospitalization and treatment of a sick or injured person of that county or municipality.

(b) The board may contract with this state or a federal agency for the hospital treatment of a sick or injured person. (Acts 65th Leg., R.S., Ch. 29, Sec. 6(g) (part).)

Source Law

(g) The board … shall be authorized to contract with any county or incorporated municipality located outside its boundaries for the hospitalization and treatment of the sick, diseased, or injured persons of any such county or municipality, and shall have the authority to contract with the state or agencies of the federal government for the hospital treatment of sick, diseased, or injured persons.

Revisor's Note

(1) Section 6(g), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, refers to an "incorporated" municipality. The revised law omits the reference to "incorporated" because under the Local Government Code all municipalities must be incorporated.

(2) Section 6(g), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, refers to the treatment of a "sick, diseased, or injured" person. The revised law omits the reference to "diseased" because "diseased" is included in the meaning of "sick."

Revised Law

Sec. 1088.114. CONTRACTS WITH GOVERNMENTAL ENTITIES FOR INVESTIGATORY OR OTHER SERVICES. The board may contract with a political subdivision or governmental agency for the district to provide investigatory or other services for the medical, hospital, or welfare needs of district inhabitants. (Acts 65th Leg., R.S., Ch. 29, Sec. 6(g) (part).)

Source Law

(g) The board shall be authorized to contract with any other political subdivision or governmental agency whereby the district will provide investigatory or other services as to the medical, hospital, or welfare needs of the inhabitants of the district and … .

Revised Law

Sec. 1088.115. PAYMENT FOR TREATMENT; PROCEDURES. (a) When a patient who resides in the district is admitted to a district hospital facility, the district administrator may have an inquiry made into the financial circumstances of:

(1) the patient; and

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

(b) If the district administrator determines that the patient or relatives cannot pay all or part of the costs of the patient's 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 relatives can pay for all or part of the costs of the care and treatment, as determined by the district's indigent health care policy, the patient or 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) The board may institute a suit to collect an amount owed to the district by a patient who has not been determined to be unable to pay under this section.

(f) If there is a dispute as to the ability to pay, or doubt in the mind of the district administrator concerning the ability to pay, the board shall hold a hearing and, after calling witnesses, shall determine the issue. (Acts 65th Leg., R.S., Ch. 29, Secs. 6(l), 18.)

Source Law

[Sec. 6]

(l) The board may institute a suit to collect amounts owed to the district by patients who have not been determined to be unable to pay under Section 18.

Sec. 18. When a patient residing within the district has been admitted to the district's hospital facilities, the administrator may cause inquiry to be made as to the patient's financial circumstances and those of the relatives of the patient legally liable for the patient's support. If the administrator finds that the patient or the patient's relatives are able to pay for the patient's care and treatment in whole or in part, as determined by the district's current indigent health care policy, an order shall be made directing the patient or the patient's relatives to pay to the hospital district for the care and support of the patient a specified sum each week in proportion to their financial ability. The administrator shall have power and authority to collect the sums from the estate of the patient or the patient's relatives legally liable for the patient's support in the manner provided by law for collection of expenses in the last illness of a deceased person. If the administrator finds that the patient or the patient's relatives are not able to pay either in whole or in part for the patient's care and treatment in the hospital, it shall become a charge on 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, the board of directors shall hear and determine the issue after calling witnesses.

Revisor's Note

Section 18, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, requires the district administrator to determine ability to pay using the district's "current" indigent health care policy. The revised law omits "current" as unnecessary because a requirement that the district administrator make a determination using the district's indigent health care policy implies that the district administrator must make that determination using the policy in effect at the time the determination is made.

Revised Law

Sec. 1088.116. NONPROFIT CORPORATION. (a) The district may create and sponsor a nonprofit corporation under the Business Organizations Code and may contribute money to or solicit money for the corporation.

(b) The corporation may use its money only to provide health care or other services the district is authorized to provide under this chapter.

(c) The corporation may invest the corporation's money in any manner in which the district may invest the district's money, including investing money as authorized by Chapter 2256, Government Code.

(d) The board shall establish controls to ensure that the corporation uses its money as required by this section. (Acts 65th Leg., R.S., Ch. 29, Sec. 6(m).)

Source Law

(m) The district may sponsor and create a nonprofit corporation under the Texas Non-Profit Corporation Act (Article 1396-1.01 et seq., Vernon's Texas Civil Statutes) and may contribute funds to or solicit funds for the corporation. The corporation may use its funds only to provide health care or other services the district is authorized to provide under this Act. The board of directors of the hospital district shall establish adequate controls to ensure that the corporation uses its funds as required by this subsection. The corporation may invest corporation funds in any manner in which the district may invest funds, including investing funds as authorized by Chapter 2256, Government Code.

Revisor's Note

Section 6(m), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, refers to the Texas Non-Profit Corporation Act. That act was codified in various chapters of the Business Organizations Code by Chapter 182, Acts of the 78th Legislature, Regular Session, 2003. The Business Organizations Code took effect January 1, 2006, and applies only to domestic business entities formed on or after that date, to domestic business entities formed before that date that elect to have that code govern their operations, and to certain foreign business entities. On January 1, 2010, the Texas Non-Profit Corporation Act expires, and the Business Organizations Code will apply to all business entities without regard to date of formation or whether an entity is a foreign or domestic business entity. Because this chapter will not take effect until 2011, the revised law is drafted to reflect the applicability of only the Business Organizations Code.

Revised Law

Sec. 1088.117. AUTHORITY TO SUE AND BE SUED. The district, through the board, may sue and be sued. (Acts 65th Leg., R.S., Ch. 29, Sec. 6(c) (part).)

Source Law

[Sections 1088.118-1088.150 reserved for expansion]

SUBCHAPTER D. GENERAL FINANCIAL PROVISIONS

Revised Law

Sec. 1088.151. BUDGET. (a) The district administrator shall prepare an annual budget for approval by the board.

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

(1) the outstanding obligations of the district;

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

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

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

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

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

(7) the estimated tax rate required; and

(8) the proposed expenditures and disbursements and the estimated receipts and collections for the following fiscal year. (Acts 65th Leg., R.S., Ch. 29, Sec. 7(c) (part).)

Source Law

(c) The administrator shall prepare an annual budget for approval by the board of directors. The budget shall contain a complete financial statement of the district showing all outstanding obligations of the district, the cash on hand to the credit of each fund of the district, the funds received from all sources during the previous year, the funds available from all sources during the ensuing year, with balances expected at year end of the year in which the budget is being prepared, estimated revenues and balances available to cover the proposed budget, the estimated tax rate which will be required, and the proposed expenditures, disbursements, and estimated receipts and collections for the following fiscal year… .

Revised Law

Sec. 1088.152. NOTICE; HEARING; ADOPTION OF BUDGET. (a) The board shall hold a public hearing on the proposed annual budget.

(b) At least 10 days before the date of the hearing, notice of the hearing shall be published one time in a newspaper of general circulation in the district.

(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 interest of the taxpayers and that the law warrants. (Acts 65th Leg., R.S., Ch. 29, Sec. 7(c) (part).)

Source Law

(c) … 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 in a newspaper of general circulation in the hospital district. Any resident of the district shall have the right to be present and participate in the hearing. At the conclusion of the hearing, the budget, as proposed by the administrator, shall be acted on by the board of directors. The board of directors shall have authority to make such changes in the budget as in their judgment the law warrants and the interest of the taxpayers demand… . the annual budget, and … shall be approved by the board of directors.

Revised Law

Sec. 1088.153. AMENDMENTS TO BUDGET. The budget may be amended as required by circumstances. The board must approve all amendments. (Acts 65th Leg., R.S., Ch. 29, Sec. 7(c) (part).)

Source Law

(c) … The annual budget may be amended from time to time as the circumstances may require, but … all amendments, shall be approved by the board of directors.

Revisor's Note

Section 7(c), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, 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. 1088.154. RESTRICTION ON EXPENDITURES. Money may be spent only for an expense included in the budget or an amendment to the budget. (Acts 65th Leg., R.S., Ch. 29, Sec. 7(c) (part).)

Source Law

Revised Law

Sec. 1088.155. 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 65th Leg., R.S., Ch. 29, Sec. 7(a).)

Source Law

Sec. 7. (a) The district shall be operated on the basis of a fiscal year established by the board. The fiscal year may not be changed when revenue bonds are outstanding or more than one time in a 24-month period.

Revised Law

Sec. 1088.156. ANNUAL AUDIT. The board annually shall have an independent audit made of the district's books and records. (Acts 65th Leg., R.S., Ch. 29, Sec. 7(b) (part).)

Source Law

(b) The board shall cause an independent audit to be made annually of the books and records of the district… .

Revised Law

Sec. 1088.157. INSPECTION OF AUDIT AND DISTRICT RECORDS. The annual audit and other district records shall be open to inspection at the district's principal office. (Acts 65th Leg., R.S., Ch. 29, Sec. 7(b) (part).)

Source Law

(b) … The audit, together with other records of the district, shall be open to inspection at the principal office of the district.

Revised Law

Sec. 1088.158. 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 65th Leg., R.S., Ch. 29, Sec. 7(d).)

Source Law

(d) As soon as practicable after the close of each fiscal year, the administrator shall prepare for the board a full sworn statement of all moneys belonging to the district and a full account of disbursements.

Revised Law

Sec. 1088.159. DEPOSITORY. (a) The board shall select one or more banks to serve as a depository for district money.

(b) District money, other than money invested as provided by Section 1088.160(b) and money transmitted to a bank for payment of bonds or obligations issued by the district, shall be deposited as received with the depository bank and shall remain on deposit.

(c) This chapter, including Subsection (b), does not limit the power of the board to place a part of district money on time deposit or to purchase certificates of deposit.

(d) 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 treasury bonds in an amount sufficient to secure from loss the district money that exceeds the amount secured by the Federal Deposit Insurance Corporation. (Acts 65th Leg., R.S., Ch. 29, Sec. 12.)

Source Law

Sec. 12. (a) The board of directors of the district shall name one or more banks to serve as depository for the funds of the district. All funds of the district, except those invested as provided in Section 6 of this Act, and those transmitted to a bank or banks as payment for bonds or obligations issued by the district, shall be deposited as received with the depository bank and shall remain on deposit, provided that nothing in this Act shall limit the power of the board to place a portion of such funds on time deposit or purchase certificates of deposit.

(b) Before the district deposits in a bank funds of the district in an amount which exceeds the maximum amount secured by the Federal Deposit Insurance Corporation, the bank shall be required to execute treasury bonds in an amount sufficient to secure from loss the district funds which exceed the amount secured by the Federal Deposit Insurance Corporation.

Revised Law

Sec. 1088.160. SPENDING AND INVESTMENT RESTRICTIONS. (a) Except as otherwise provided by this chapter, 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 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 65th Leg., R.S., Ch. 29, Secs. 6(a) (part), 11 (part).)

Source Law

Sec. 6. (a) … operating, depreciation, or building fund reserves may not be invested in any funds or securities other than those specified in Chapter 2256, Government Code.

Sec. 11. … Except as otherwise provided by this Act, 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 current and following fiscal year of the district.

[Sections 1088.161-1088.200 reserved for expansion]

SUBCHAPTER E. BONDS

Revised Law

Sec. 1088.201. 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 the buildings or improvements; and

(3) acquire sites to be used for district purposes. (Acts 65th Leg., R.S., Ch. 29, Sec. 8(a) (part).)

Source Law

Sec. 8. (a) The board of directors shall have the power to issue and sell general obligation bonds authorized by an election in the name and on the faith and credit of the hospital district for the purchase, construction, acquisition, repair, or renovation of buildings and improvements, equipping the buildings and improvements, and acquisition of sites to be used for district purposes… .

Revised Law

Sec. 1088.202. TAX TO PAY GENERAL OBLIGATION BONDS. (a) At the time general obligation bonds are issued by the district under Section 1088.201, 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 taxable property in the district. (Acts 65th Leg., R.S., Ch. 29, Sec. 8(a) (part).)

Source Law

(a) … At the time of the issuance of any general obligation 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¢ on each $100 valuation in any year… .

Revisor's Note

Section 8(a), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, 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. 1088.203. 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 called for that purpose.

(b) The election shall be conducted in accordance with Chapter 1251, Government Code. (Acts 65th Leg., R.S., Ch. 29, Sec. 8(a) (part).)

Source Law

(a) … No general obligation bonds shall be issued by the hospital district until authorized by a majority of the qualified voters of the district voting at an election called for that purpose. The election shall be conducted in accordance with Chapter 1251, Government Code.

Revisor's Note

Section 8(a), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, 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.

Revised Law

Sec. 1088.204. MATURITY OF GENERAL OBLIGATION BONDS. District bonds must mature not later than 40 years after the date of issuance. (Acts 65th Leg., R.S., Ch. 29, Sec. 8(d) (part).)

Source Law

(d) Bonds of the district … shall mature within 40 years of their date, … .

Revised Law

Sec. 1088.205. EXECUTION OF GENERAL OBLIGATION 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 65th Leg., R.S., Ch. 29, Sec. 8(d) (part).)

Source Law

(d) 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 618, Government Code, as added by Chapter 227, Acts of the 76th Legislature, Regular Session, 1999, and … .

Revisor's Note

(1) Section 8(d), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, provides that district bonds must bear interest at a rate not to exceed that provided by Chapter 1204, Government Code. The revised law omits the provision because Section 1204.006, Government Code, applies to the district on its own terms by application of Section 1204.001, Government Code. The omitted law reads:

(d) [Bonds of the district] shall bear interest at a rate not to exceed the rate provided by Chapter 1204, Government Code, … .

(2) Section 8(d), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, provides that the 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 8(d) 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:

(d) [Bonds of the district] … shall be subject to the same requirements in the matter of approval by the attorney general and registration by the comptroller of public accounts 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, they are incontestable for any cause.

Revised Law

Sec. 1088.206. REVENUE BONDS. (a) The board may issue revenue bonds to:

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

(2) acquire sites for those buildings or improvements.

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

(d) The bonds must be issued in the manner and in accordance with the procedures and requirements prescribed by Sections 264.042, 264.043, 264.044, 264.046, 264.047, 264.048, and 264.049, Health and Safety Code, for issuance of revenue bonds by a county hospital authority. (Acts 65th Leg., R.S., Ch. 29, Sec. 9 (part).)

Source Law

Sec. 9. The board of directors is authorized to issue revenue bonds and … for purchasing, constructing, acquiring, repairing, equipping, or renovating buildings and improvements for district purposes, and for acquiring sites for them, the bonds to be payable from and secured by a pledge of all or any part of the revenues of the district to be derived from the operation of its hospital system. The bonds may be additionally secured by a mortgage or deed of trust lien on any part or all of its properties. The bonds shall be issued in the manner and in accordance with the procedures and requirements specified for the issuance of revenue bonds by county hospital authorities in Sections 264.042, 264.043, 264.044, 264.046, 264.047, 264.048, and 264.049, Health and Safety Code.

Revised Law

Sec. 1088.207. BONDS EXEMPT FROM TAXATION. The following are exempt from taxation by this state or a political subdivision of this state:

(1) bonds issued or assumed by the district;

(2) the transfer and issuance of the bonds; and

(3) profits made in the sale of the bonds. (Acts 65th Leg., R.S., Ch. 29, Sec. 22 (part).)

Source Law

Sec. 22. … any bonds issued or assumed by it, their transfer and issuance, and any profits made in the sale of them are at all times free from taxation by the state or any municipality or political subdivision.

Revisor's Note

(End of Subchapter)

(1) Sections 8(c) and 9, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, authorize the district to issue refunding bonds for indebtedness issued or assumed by the district. The revised law omits those provisions because Chapter 1207, Government Code, provides general authority for an issuer, including a hospital district, to issue refunding securities and prescribes procedures applicable to the securities. The omitted law reads:

[Sec. 8]

(c) The board may issue refunding bonds of the district for the purpose of refunding and paying off any outstanding indebtedness issued or assumed. The board shall issue refunding bonds in accordance with Chapter 1207, Government Code.

Sec. 9. [The board of directors is authorized to] … refund any previously issued revenue bonds … .

(2) Section 14, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, 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 14 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 14 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 public 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. 14. All bonds issued and assumed by the district are legal and authorized investments of banks, savings banks, trust companies, building and loan associations, savings and loan associations, insurance companies, trustees, and sinking funds of cities, towns, villages, counties, school districts, or other political subdivisions of the state, and for all public funds of the state or its agencies including the State Permanent School Fund… .

(3) Section 14, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, 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 provision as impliedly repealed by Section 404.0221, Government Code (enacted in 1995), which lists eligible collateral for deposits of state funds by the comptroller, and by Chapter 2257, Government Code (enacted in 1989 as Article 2529d, Vernon's Texas Civil Statutes), which governs eligible collateral for deposits of funds of other public agencies, including political subdivisions. The omitted law reads:

Sec. 14… . Such bonds and indebtedness are eligible to secure deposit of public funds of the state, cities, towns, villages, counties, school districts, or other political subdivisions or corporations of the state, and are lawful and sufficient security for deposits to the extent of their value when accompanied by all their unmatured coupons.

[Sections 1088.208-1088.250 reserved for expansion]

SUBCHAPTER F. TAXES

Revised Law

Sec. 1088.251. IMPOSITION OF AD VALOREM TAX. (a) The board shall impose a tax on all property in the district subject to district taxation.

(b) The board shall impose the tax to:

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

(2) provide for the operation and maintenance of the district and hospital system;

(3) make improvements and additions to the hospital system; and

(4) acquire necessary sites for those improvements and additions by purchase, lease, or condemnation.

(c) The board may not impose a tax to pay the principal of or interest on revenue bonds. (Acts 65th Leg., R.S., Ch. 29, Secs. 4(b) (part), 13(a) (part).)

Source Law

[Sec. 4]

(b) … on all taxable property situated within the district, subject to hospital district taxation, … .

Sec. 13. (a) The board of directors shall annually levy a tax … for the purpose of:

(1) paying the indebtedness issued or assumed by the hospital district but no tax may be levied to pay principal or interest on revenue bonds;

(2) providing for the operation and maintenance of the hospital district and hospital system; and

(3) making further improvements and additions to the hospital system, and acquiring necessary sites for them by purchase, lease, or condemnation.

Revised Law

Sec. 1088.252. TAX RATE. (a) The board may impose the tax at a rate not to exceed 75 cents on each $100 valuation of taxable property in the district.

(b) In setting the tax rate, the board shall consider the income of the district from sources other than taxation. (Acts 65th Leg., R.S., Ch. 29, Secs. 4(b) (part), 13(a) (part), (b) (part).)

Source Law

[Sec. 4]

(b) [At the election there shall be submitted to the electors of the area of the proposed district the proposition of whether the hospital district shall be created with authority to have transferred to it the existing hospital facilities of Reagan County and any city or town in the district, including the city of Big Lake, and to levy annual taxes] at a rate not to exceed 75 cents on the $100 valuation on all taxable property situated within the district, subject to hospital district taxation, … .

Sec. 13. (a) [The board of directors shall annually levy a tax] not to exceed the amount permitted by this Act … .

(b) 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 13(b), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, 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:

(b) … 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. 1088.253. 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 65th Leg., R.S., Ch. 29, Sec. 16 (part).)

Source Law

Sec. 16. … 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

(End of Subchapter)

(1) Section 6(j), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, authorizes the board to institute a suit to enforce the payment of taxes and to foreclose liens to secure that payment. The revised law omits that provision because it duplicates Chapter 33, Tax Code, which authorizes a taxing unit of government to file suit to enforce the payment of taxes and to foreclose a lien to secure that payment. The omitted law reads:

(j) The board may institute a suit to enforce the payment of taxes and to foreclose liens to secure the payment of taxes due to the district.

(2) Section 16, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, provides that the district may impose taxes for the entire year in which the district is established. The revised law omits that provision as executed. The omitted law reads:

Sec. 16. The directors shall have the authority to levy taxes for the entire year in which the district is established… .

(3) Section 16, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, 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. 16. … The Tax Code governs the appraisal of property for and assessment and collection of district taxes. …

[Sections 1088.254-1088.300 reserved for expansion]

SUBCHAPTER G. DISSOLUTION

Revised Law

Sec. 1088.301. DISSOLUTION; ELECTION. (a) The district may be dissolved only on approval of a majority of the district voters voting in an election held for that purpose.

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

(c) The board shall order an election if the board receives a petition requesting an election that is signed by at least 15 percent of the registered voters of the district.

(d) 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.

(e) Section 41.001(a), Election Code, does not apply to an election ordered under this section. (Acts 65th Leg., R.S., Ch. 29, Secs. 18A(a), (b), (c) (part).)

Source Law

Sec. 18A. (a) The district may be dissolved only if the dissolution is approved by a majority of the qualified voters of the district voting in an election called and held for that purpose.

(b) The board may order an election on the question of dissolving the district and disposing of the district's assets and obligations. The board shall order an election if the board receives a petition requesting an election that is signed by at least 15 percent of the registered voters in the district.

(c) … Section 41.001(a), Election Code, does not apply to an election ordered under this section. The order calling the election shall 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.

Revisor's Note

(1) Section 18A(a), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, provides for dissolution of the district if approved by a majority of the "qualified" voters. The revised law omits "qualified" for the reason stated in the revisor's note to Section 1088.203.

(2) Section 18A(a), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, provides that the district may be dissolved if authorized at an election "called and held" for that purpose. 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 18A(c), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, states that the election must be held not later than the 60th day 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:

Revised Law

Sec. 1088.302. NOTICE OF ELECTION. (a) The board shall give notice of an election under this subchapter by publishing once a week for two consecutive weeks a substantial copy of the election order in a newspaper with general circulation in the district.

(b) The first publication of the notice must appear not later than the 35th day before the date set for the election. (Acts 65th Leg., R.S., Ch. 29, Sec. 18A(d) (part).)

Source Law

(d) The board shall give notice of the election by publishing a substantial copy of the election order in a newspaper with general circulation in the district once a week for two consecutive weeks. The first publication must appear not less than 35 days before the date set for the election… .

Revised Law

Sec. 1088.303. BALLOT. The ballot for an election under this subchapter must be printed to permit voting for or against the proposition: "The dissolution of the Reagan Hospital District of Reagan County, Texas." (Acts 65th Leg., R.S., Ch. 29, Sec. 18A(d) (part).)

Source Law

(d) … The ballot for the election shall be printed to permit voting for or against the proposition: "The dissolution of the Reagan Hospital District of Reagan County, Texas."

Revised Law

Sec. 1088.304. ELECTION RESULTS. (a) If a majority of the votes in an election under this subchapter favor dissolution, the board shall find that the district is dissolved.

(b) If a majority of the votes in the election do not favor dissolution, the board shall continue to administer the district and another election on the question of dissolution may not be held before the first anniversary of the date of the most recent election to dissolve the district. (Acts 65th Leg., R.S., Ch. 29, Sec. 18A(e).)

Source Law

(e) If a majority of the votes in the election favor dissolution, the board shall find that the district is dissolved. If a majority of the votes in the election do not favor dissolution, the board shall continue to administer the district, and another election on the question of dissolution may not be held before the first anniversary of the most recent election to dissolve the district.

Revised Law

Sec. 1088.305. TRANSFER, SALE, OR ADMINISTRATION OF ASSETS. (a) If a majority of the votes in an election held under this subchapter favor dissolution, the board shall:

(1) transfer the land, buildings, improvements, equipment, and other assets that belong to the district to Reagan County or to another governmental entity in Reagan County;

(2) sell the assets and liabilities to another person; or

(3) administer the property, assets, and debts until all money has been disposed of and all district debts have been paid or settled.

(b) If the board makes the transfer under Subsection (a)(1), the county or entity assumes all debts and obligations of the district at the time of the transfer, and the district is dissolved.

(c) If the board does not make the transfer under Subsection (a)(1), the board shall sell the assets and liabilities to another person under Subsection (a)(2) or administer the property, assets, and debts of the district under Subsection (a)(3), and the district is dissolved when all money has been disposed of and all district debts have been paid or settled. (Acts 65th Leg., R.S., Ch. 29, Secs. 18A(f), (g), (m) (part).)

Source Law

(f) If a majority of the votes in the election favor dissolution, the board shall:

(1) transfer the land, buildings, improvements, equipment, and other assets that belong to the district to Reagan County or to another governmental entity in Reagan County;

(2) sell the assets and liabilities to another person; or

(3) administer the property, assets, and debts until all funds have been disposed of and all district debts have been paid or settled.

(g) If the district transfers the land, buildings, improvements, equipment, and other assets to a county or other governmental entity, the county or entity assumes all debts and obligations of the district at the time of the transfer and the district is dissolved. If the district does not transfer the land, buildings, improvements, equipment, and other assets to a county or other governmental entity, the board shall sell the assets and liabilities to another person or administer the property, assets, and debts of the district until all funds have been disposed of and all district debts have been paid or settled, at which time the district is dissolved.

(m) The district may provide for the sale or transfer of the district's assets and liabilities to another person or entity… .

Revisor's Note

Section 18A(m), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, refers to "another person or entity." The revised law omits "entity" because "entity" is included in the meaning of "person" under Section 311.005(2), Government Code (Code Construction Act).

Revised Law

Sec. 1088.306. SALE OR TRANSFER OF ASSETS AND LIABILITIES. (a) The dissolution of the district and the sale or transfer of the district's assets and liabilities to another person may not contravene a trust indenture or bond resolution relating to the district's outstanding bonds. The dissolution and sale or transfer does not diminish or impair the rights of a holder of an outstanding bond, warrant, or other obligation of the district.

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

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

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

(d) A grant from federal funds is an obligation to be repaid in satisfaction. (Acts 65th Leg., R.S., Ch. 29, Secs. 18A(m) (part), (n).)

Source Law

(m) … The dissolution of the district and the sale or transfer of the district's assets and liabilities to another person or entity may not contravene a trust indenture or bond resolution relating to the outstanding bonds of the district. The dissolution and sale or transfer does not diminish or impair the rights of a holder of an outstanding bond, warrant, or other obligation of the district.

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

Revisor's Note

Section 18A(m), Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, refers to "another person or entity." The revised law omits "entity" for the reason stated in the revisor's note to Section 1088.305.

Revised Law

Sec. 1088.307. IMPOSITION OF TAX AND RETURN OF SURPLUS TAXES. (a) After the board finds that the district is dissolved, the board shall:

(1) determine the debt owed by the district; and

(2) impose on the property included in the district's tax rolls a tax that is in proportion of the debt to the property value.

(b) On the payment of all outstanding debts and obligations of the district, the board shall order the secretary to return to each district taxpayer the taxpayer's pro rata share of all unused tax money.

(c) A taxpayer may request that the taxpayer's share of surplus tax money be credited to the taxpayer's county taxes. If a taxpayer requests the credit, the board shall direct the secretary to transmit the money to the county tax assessor-collector. (Acts 65th Leg., R.S., Ch. 29, Secs. 18A(h), (i), (j).)

Source Law

(h) After the board finds that the district is dissolved, the board shall:

(1) determine the debt owed by the district; and

(2) impose on the property included in the district's tax rolls a tax that is in proportion of the debt to the property value.

(i) When all outstanding debts and obligations of the district are paid, the board shall order the secretary to return the pro rata share of all unused tax money to each district taxpayer.

(j) A taxpayer may request that the taxpayer's share of surplus tax money be credited to the taxpayer's county taxes. If a taxpayer requests the credit, the board shall direct the secretary to transmit the funds to the county tax assessor-collector.

Revised Law

Sec. 1088.308. REPORT; DISSOLUTION ORDER. (a) After the district has paid all district debts and has disposed of all district money and other assets as prescribed by this subchapter, the board shall file a written report with the Commissioners Court of Reagan County summarizing the board's actions in dissolving the district.

(b) Not later than the 10th day after the date the Commissioners Court of Reagan County receives the report and determines that the requirements of this subchapter have been fulfilled, the commissioners court shall enter an order dissolving the district and releasing the board from any further duty or obligation. (Acts 65th Leg., R.S., Ch. 29, Secs. 18A(k), (l).)

Source Law

(k) After the district has paid all its debts and has disposed of all its assets and funds as prescribed by this section, the board shall file a written report with the Commissioners Court of Reagan County setting forth a summary of the board's actions in dissolving the district.

(l) Not later than the 10th day after the date it receives the report and determines that the requirements of this section have been fulfilled, the Commissioners Court of Reagan County shall enter an order dissolving the district and releasing the board of directors of the district from any further duty or obligation.

Revisor's Note

(End of Chapter)

(1) Sections 3(b) and 20, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, provide for the transfer of certain land, buildings, improvements, equipment, funds, and taxes to the district after the district is created and provide for the assumption of debt by the district on creation. The revised law omits the provisions as executed. The omitted law reads:

[Sec. 3]

(b) The district authorized to be created shall have transferred to it the title to all land, buildings, improvements, equipment, and other property in any way pertaining to the hospital system owned by Reagan County or a city or town in the district including the city of Big Lake… . The district shall assume all outstanding obligations and indebtedness incurred by a city or town including the city of Big Lake or by Reagan County for hospital purposes within the boundaries of the district before the creation of the district.

Sec. 20. … When the district is established, the county and all towns and cities located in the district shall convey and transfer to the district title to all lands, buildings, improvements, and equipment pertaining to a hospital or hospital system jointly or separately owned by the county or any city or town within the district. Operating funds and reserves for operating expenses which are on hand and funds which have been budgeted for hospital purposes by the county or any city or town in the district for the remainder of the fiscal year in which the district is established shall likewise be transferred to the district, as shall taxes levied for hospital purposes for the current year, and all sinking funds established for payment of indebtedness assumed by the district.

(2) Section 23, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, effectively 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. 23. … If any provision of this Act is invalid, this fact shall not affect the authorization for the creation of the district or the validity of any other provisions of this Act, and the legislature hereby declares that it would have created the district and enacted the valid provisions of this Act notwithstanding the invalidity of any other provision.

(3) Section 24, Chapter 29, Acts of the 65th Legislature, Regular Session, 1977, 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 that section as executed. The omitted law reads:

Sec. 24. Proof of publication of the notice required in the enactment of this Act under the provisions of Article IX, Section 9, 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 found sufficient to satisfy this requirement.


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