TLC: Special District Local Laws Code Proposed Chapters

81C38(2) CLG

CHAPTER 1072. MAVERICK COUNTY HOSPITAL DISTRICT

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 1072.001. DEFINITIONS ............................... 3

Sec. 1072.002. AUTHORITY FOR CREATION .................... 3

Sec. 1072.003. ESSENTIAL PUBLIC FUNCTION ................. 4

Sec. 1072.004. DISTRICT TERRITORY ........................ 4

Sec. 1072.005. DISTRICT SUPPORT AND MAINTENANCE NOT

STATE OBLIGATION ........................ 5

Sec. 1072.006. RESTRICTION ON STATE FINANCIAL

ASSISTANCE .............................. 5

[Sections 1072.007-1072.050 reserved for expansion]

SUBCHAPTER B. DISTRICT ADMINISTRATION

Sec. 1072.051. BOARD ELECTION; TERMS ..................... 7

Sec. 1072.052. QUALIFICATIONS FOR OFFICE ................. 8

Sec. 1072.053. BOND; RECORD OF BOND AND OATH OR

AFFIRMATION OF OFFICE ................... 9

Sec. 1072.054. BOARD VACANCY ............................. 10

Sec. 1072.055. OFFICERS .................................. 10

Sec. 1072.056. COMPENSATION; EXPENSES .................... 10

Sec. 1072.057. VOTING REQUIREMENT ........................ 11

Sec. 1072.058. DISTRICT ADMINISTRATOR .................... 11

Sec. 1072.059. EMPLOYMENT OF MEDICAL STAFF AND OTHER

HEALTH CARE PROVIDERS ................... 12

Sec. 1072.060. APPOINTMENT AND REMOVAL OF MEDICAL

STAFF ................................... 12

Sec. 1072.061. RECRUITMENT AND RETENTION OF MEDICAL

STAFF AND PROFESSIONAL PERSONNEL ........ 13

Sec. 1072.062. OTHER DISTRICT EMPLOYEES .................. 13

Sec. 1072.063. RETIREMENT BENEFITS ....................... 14

Sec. 1072.064. MAINTENANCE OF RECORDS; PUBLIC

INSPECTION .............................. 15

[Sections 1072.065-1072.100 reserved for expansion]

SUBCHAPTER C. POWERS AND DUTIES

Sec. 1072.101. DISTRICT RESPONSIBILITY ................... 15

Sec. 1072.102. ANNUAL DETERMINATION OF CARE .............. 16

Sec. 1072.103. RESTRICTION ON POLITICAL SUBDIVISION

TAXATION AND DEBT ....................... 17

Sec. 1072.104. MANAGEMENT AND CONTROL OF DISTRICT ........ 18

Sec. 1072.105. RULES ..................................... 18

Sec. 1072.106. PURCHASING AND ACCOUNTING PROCEDURES ...... 19

Sec. 1072.107. DISTRICT PROPERTY, FACILITIES, AND

EQUIPMENT ............................... 19

Sec. 1072.108. EMINENT DOMAIN ............................ 20

Sec. 1072.109. GIFTS AND ENDOWMENTS ...................... 22

Sec. 1072.110. CONSTRUCTION CONTRACTS .................... 22

Sec. 1072.111. OPERATING AND MANAGEMENT CONTRACTS ........ 23

Sec. 1072.112. CONTRACTS WITH POLITICAL SUBDIVISIONS

OR GOVERNMENT AGENCIES FOR HOSPITAL

AND MEDICAL CARE ........................ 24

Sec. 1072.113. PAYMENT FOR TREATMENT; PROCEDURES ......... 24

Sec. 1072.114. REIMBURSEMENT FOR SERVICE ................. 25

Sec. 1072.115. CHARITABLE ORGANIZATION ................... 26

Sec. 1072.116. NONPROFIT CORPORATION ..................... 27

[Sections 1072.117-1072.150 reserved for expansion]

SUBCHAPTER D. GENERAL FINANCIAL PROVISIONS

Sec. 1072.151. BUDGET .................................... 29

Sec. 1072.152. ADOPTION OF PROPOSED BUDGET: NOTICE AND

HEARING ................................. 30

Sec. 1072.153. FISCAL YEAR ............................... 30

Sec. 1072.154. ANNUAL AUDIT .............................. 31

Sec. 1072.155. DEPOSITORY ................................ 31

Sec. 1072.156. AUTHORITY TO BORROW MONEY; SECURITY ....... 32

[Sections 1072.157-1072.200 reserved for expansion]

SUBCHAPTER E. BONDS

Sec. 1072.201. BONDS ..................................... 33

Sec. 1072.202. TAX TO PAY GENERAL OBLIGATION BONDS ....... 33

Sec. 1072.203. BOND ELECTION ............................. 34

Sec. 1072.204. REVENUE BONDS ............................. 36

Sec. 1072.205. REFUNDING BONDS ........................... 37

Sec. 1072.206. MATURITY OF BONDS ......................... 38

Sec. 1072.207. EXECUTION OF BONDS ........................ 38

Sec. 1072.208. BONDS EXEMPT FROM TAXATION ................ 39

[Sections 1072.209-1072.250 reserved for expansion]

SUBCHAPTER F. TAXES

Sec. 1072.251. IMPOSITION OF AD VALOREM TAX .............. 43

Sec. 1072.252. TAX RATE .................................. 44

Sec. 1072.253. TAX ASSESSOR-COLLECTOR .................... 44

CHAPTER 1072. MAVERICK COUNTY HOSPITAL DISTRICT

SUBCHAPTER A. GENERAL PROVISIONS

Revised Law

Sec. 1072.001. 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 Maverick County Hospital District. (New.)

Revisor's Note

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

Revised Law

Sec. 1072.002. AUTHORITY FOR CREATION. The Maverick County Hospital District is created under the authority of Section 9, Article IX, Texas Constitution. (Acts 59th Leg., R.S., Ch. 172, Sec. 1.)

Source Law

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

Revisor's Note

Section 1, Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, refers to the "Hospital District of Maverick County, Texas." The revised law substitutes "Maverick County Hospital District" or "district" for the quoted language in this section and throughout this chapter because under Section 1, Chapter 385, Acts of the 76th Legislature, Regular Session, 1999, the name of the Hospital District of Maverick County was changed to the Maverick County Hospital District. In addition, the revised law omits Section 1, Chapter 385, Acts of the 76th Legislature, Regular Session, 1999, as executed. The omitted law reads:

Sec. 1. (a) The name of the Hospital District of Maverick County is changed to the Maverick County Hospital District.

(b) A reference in Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, or in other law to the Hospital District of Maverick County means the Maverick County Hospital District.

Revised Law

Sec. 1072.003. ESSENTIAL PUBLIC FUNCTION. The district is a public entity performing an essential public function. (Acts 59th Leg., R.S., Ch. 172, Sec. 10(j) (part).)

Source Law

(j) Since the District created under this Act is a public entity performing an essential public function, … .

Revised Law

Sec. 1072.004. DISTRICT TERRITORY. The boundaries of the district are coextensive with the boundaries of Maverick County. (Acts 59th Leg., R.S., Ch. 172, Sec. 2.)

Source Law

Sec. 2. The boundaries of this District are coterminous with the boundaries of Maverick County.

Revised Law

Sec. 1072.005. DISTRICT SUPPORT AND MAINTENANCE NOT STATE OBLIGATION. The support and maintenance of the district's hospital system and any indebtedness incurred by the district under this chapter may not become a charge against or obligation of this state. (Acts 59th Leg., R.S., Ch. 172, Sec. 17 (part).)

Source Law

Sec. 17. The support and maintenance of the hospital system of the District and any indebtedness incurred by the District under this Act shall never become a charge against nor an obligation of the State of Texas, … .

Revised Law

Sec. 1072.006. RESTRICTION ON STATE FINANCIAL ASSISTANCE. The legislature may not make a direct appropriation for the construction, maintenance, or improvement of a district facility. (Acts 59th Leg., R.S., Ch. 172, Sec. 17 (part).)

Source Law

Sec. 17. … nor shall any direct appropriation be made by the Legislature of the State of Texas for the construction, maintenance or improvement of any of the facilities of the District.

Revisor's Note

(End of Subchapter)

Sections 4(a), (b), (e), (f), and (g) and Section 7, Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provide procedures for holding an election on the creation of the district and the imposition of an ad valorem tax. Because the creation of the district and the imposition of the tax were approved at the election, the revised law omits the relevant law as executed. The omitted law reads:

Sec. 4. (a) The District authorized to be created by this Act is created upon approval of a majority of the qualified electors who own taxable property within the District and who have duly rendered that property for taxation and who vote at an election called for this purpose.

(b) Upon receiving the petition of 100 people who are qualified to vote in this election, or by its own order, recorded in the minutes, the commissioners court of the county in which this District is located shall order an election for the purpose of creating this District, not less than 20 days nor more than 30 days after the date of the order.

(e) … If a majority of the persons voting in the election vote for the creation of the District, the commissioners court shall, within 10 days after the results are filed, declare the results and order the District created. A copy of this order shall be placed in the minutes of the court.

(f) If a majority of the persons voting at the election vote against the creation of the District, this does not prevent the holding of other elections for the same purpose.

(g) The ballot for this election must be substantially as follows:

"FOR the creation of the Hospital District of Maverick County, Texas.

"AGAINST the creation of the Hospital District of Maverick County, Texas."

Sec. 7. (a) At the time of the election to create the District and to elect directors, the commissioners court may order an election to determine whether the District may levy taxes within the District. This tax may not exceed 50 cents on the $100 valuation of all taxable property within the District. If the commissioners court does not include this election in the order for the election to create the District, the Board of Directors may order this election at any time.

(b) Prior to this election, notice must be given by the appropriate governmental unit, either the commissioners court or the Board of Directors in the same manner provided in Section 4 of this Act. The presiding judge of each voting place shall certify the results to the appropriate governmental unit which shall declare the results. The results are to be of public record.

"FOR the levy of a tax not to exceed 50 cents on the $100 valuation on all property subject to taxation within the District.

"AGAINST the levy of a tax not to exceed 50 cents on the $100 valuation on all property subject to taxation within the District."

(d) The Board of Directors shall not levy any tax within the District until a majority of the qualified electors who own taxable property within the District and who have duly rendered that property for taxation voting in an election for this purpose vote for the levy of this tax.

[Sections 1072.007-1072.050 reserved for expansion]

SUBCHAPTER B. DISTRICT ADMINISTRATION

Revised Law

Sec. 1072.051. BOARD ELECTION; TERMS. (a) The board consists of five directors elected by district voters.

(b) Directors serve staggered four-year terms.

(c) An election shall be held on the first Tuesday after the first Monday in November of each year to elect the appropriate number of directors. (Acts 59th Leg., R.S., Ch. 172, Secs. 5(a) (part), (d), (e) (part).)

Source Law

(a) … a Board of Directors which consists of five (5) members, to be elected by the qualified electors of the District.

(d) Each year on the first Tuesday after the first Monday in November an election must be held for the purpose of electing the appropriate number of successor directors.

(e) An elected director shall serve for a four year term. …

Revisor's Note

(1) Section 5(a), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, refers to "qualified electors." 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. The revised law substitutes "voter" for "elector" because the former is the term used in the Election Code.

(2) Section 10, Chapter 385, Acts of the 76th Legislature, Regular Session, 1999, provides that changes in the qualifications for directors apply only to directors appointed or elected after 1999. Section 11, Chapter 385, Acts of the 76th Legislature, Regular Session, 1999, provides for staggering terms of directors elected in 2000 and 2001 to change from two-year terms to four-year terms. The revised law revises the establishment of staggered terms but omits these provisions as executed. The omitted law reads:

Sec. 10. The changes in law made by this Act to the qualifications of and the prohibitions applying to members of the Board of Directors of the Maverick County Hospital District do not affect the entitlement of a member serving on the Board immediately before the effective date of this Act to continue to carry out the functions of the Board for the remainder of the member's term. The changes in law apply only to a member appointed or elected on or after the effective date of this Act. This Act does not prohibit a person who is a member of the Board on the effective date of this Act from being reappointed or reelected to the Board if the person has the qualifications required for membership under Section 5, Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, as amended by this Act.

Sec. 11. The change in law made by this Act to the term of a director on the Board of Directors of the Maverick County Hospital District does not apply to the term of a director elected in an election held in 2000 or 2001 for the election of directors. A director elected in an election held in 2000 shall serve a two-year term, and a director elected in an election held in 2001 shall serve a three-year term. Successor directors shall serve four-year terms.

Revised Law

Sec. 1072.052. QUALIFICATIONS FOR OFFICE. (a) To qualify for election to the board, a person must be:

(1) a district resident; and

(2) a qualified voter.

(b) A person may not serve on the board if the person is:

(1) a party to a contract with the district to perform services for the district for compensation; or

(2) a district employee.

Source Law

(b) To qualify for election to the Board, a person must be:

(1) a resident of the District; and

(2) a qualified voter.

(1) a party to a contract with the District to perform services for the District for compensation; or

(2) an employee of the District.

(e) … and in every case a director shall be eligible for re-election.

Revised Law

Sec. 1072.053. BOND; RECORD OF BOND AND OATH OR AFFIRMATION OF OFFICE. (a) Each director shall qualify for office by executing a good and sufficient commercial bond for $1,000 that is:

(1) payable to the district; and

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

(b) The district shall pay for a director's bond.

(c) Each director's bond and constitutional oath or affirmation of office shall be deposited with the district's depository for safekeeping. (Acts 59th Leg., R.S., Ch. 172, Sec. 6(a).)

Source Law

Sec. 6. (a) When a person is elected to the Board of Directors he shall qualify for office by executing the constitutional oath of office and a good and sufficient commercial bond for $1,000 payable to the District, conditioned upon the faithful performance of his duties. The oath and bond are to be deposited with the District depository for safekeeping. The cost of the bond is an expense of the District.

Revisor's Note

Section 6(a), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, requires each director to take the constitutional oath of office. The revised law omits that provision because Section 1, Article XVI, Texas Constitution, requires all officers in this state to take the oath (or affirmation) before assuming office. Additionally, the revised law provides for the deposit of the constitutional affirmation, as well as the constitutional oath, because Section 1, Article XVI, Texas Constitution, permits an officer in this state to take either the constitutional oath or affirmation.

Revised Law

Sec. 1072.054. BOARD VACANCY. (a) If a vacancy occurs in the office of director, the remaining directors by a unanimous vote shall appoint a director for the unexpired term.

(b) The appointed director must have the qualifications required by Section 1072.052. (Acts 59th Leg., R.S., Ch. 172, Sec. 5(f).)

Source Law

(f) A vacancy on the Board of Directors shall be filled by appointment for the unexpired term by a unanimous vote of the remaining directors. The person appointed must have the qualifications required by this section.

Revised Law

Sec. 1072.055. OFFICERS. The board shall elect from among its members a president, a secretary, and a treasurer at the first meeting after each directors' election. (Acts 59th Leg., R.S., Ch. 172, Sec. 6(b).)

Source Law

(b) The directors shall, at the first meeting after the election, elect a president, a secretary, and a treasurer from their number.

Revised Law

Sec. 1072.056. COMPENSATION; EXPENSES. A director is not entitled to compensation but is entitled to reimbursement for necessary expenses incurred in the performance of official duties. (Acts 59th Leg., R.S., Ch. 172, Sec. 6(c).)

Source Law

(c) A member of the Board of Directors is not entitled to compensation for his services. However, each member is entitled to reimbursement for any necessary expense incurred by him in the performance of the duties of his office.

Revised Law

Sec. 1072.057. VOTING REQUIREMENT. A concurrence of a majority of the directors voting is sufficient in any matter relating to the business of the district. (Acts 59th Leg., R.S., Ch. 172, Sec. 5(g) (part).)

Source Law

(g) … a concurrence of a majority of the directors voting is sufficient in any matter relating to the business of the District.

Revisor's Note

Section 5(g), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that a majority of the board constitutes a quorum for the transaction of business. 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 revised law also omits "for the transaction of business" because "quorum" means the number of persons or votes necessary for a body to act. The omitted law reads:

(g) A majority of the membership of the Board of Directors constitutes a quorum for the transaction of business, and … .

Revised Law

Sec. 1072.058. DISTRICT ADMINISTRATOR. (a) The board may authorize the appointment, engagement, or employment of a district administrator to manage the operations of the district.

(b) The district administrator serves at the will of the board and is subject to rules adopted by the board.

(c) The board may require that a person, before assuming the duties of district administrator, execute a bond in an amount determined by the board of not less than $10,000 that is:

(1) payable to the district; and

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

(d) The board may pay for the bond with district money. (Acts 59th Leg., R.S., Ch. 172, Secs. 11(e) (part), (f), (g).)

Source Law

(e) The Board may:

…

(2) authorize the appointment, engagement, or employment of:

…

(B) an administrator to manage the operations of the District.

(f) A person who is appointed, engaged, or employed under Subsection (e)(2) serves at the will of the Board and is subject to the rules adopted by the Board.

(g) The Board may require that, before assuming the duties as administrator, a person shall execute a bond payable to the District of not less than $10,000, as determined by the Board, conditioned on the faithful performance of the person's duties as administrator under this Act. The Board may pay for the bond with District funds.

Revised Law

Sec. 1072.059. EMPLOYMENT OF MEDICAL STAFF AND OTHER HEALTH CARE PROVIDERS. (a) The board may employ physicians, dentists, or other health care providers as the board considers necessary for the efficient operation of the district.

(b) This section does not authorize the board to supervise or control the practice of medicine or permit the unauthorized practice of medicine, as prohibited by Subtitle B, Title 3, Occupations Code. (Acts 59th Leg., R.S., Ch. 172, Sec. 11(k-1).)

Source Law

(k-1) The Board may employ physicians, dentists, or other health care providers as the Board considers necessary for the efficient operation of the District. This subsection does not authorize the Board to supervise or control the practice of medicine or permit the unauthorized practice of medicine, as prohibited by Subtitle B, Title 3, Occupations Code.

Revised Law

Sec. 1072.060. APPOINTMENT AND REMOVAL OF MEDICAL STAFF. (a) The board may appoint a physician to or remove a physician from the staff of any hospital or hospital system that is a component of the district's operations as the board considers necessary for the efficient operation of the district.

(b) The board may adopt rules relating to the method of appointing or removing medical staff members, including the method for temporary appointments. (Acts 59th Leg., R.S., Ch. 172, Sec. 11(k).)

Source Law

(k) The Board may appoint to or remove a physician from the staff of any hospital or hospital system that is a component of the District's operations as the Board considers necessary for the efficient operation of the District. The Board may adopt rules relating to the method of appointing or removing members of the medical staff, including methods for making temporary appointments.

Revised Law

Sec. 1072.061. RECRUITMENT AND RETENTION OF MEDICAL STAFF AND PROFESSIONAL PERSONNEL. The board may, consistent with applicable federal and state laws, recruit and retain physicians, nurses, technicians, and other professional personnel through:

(1) scholarship programs;

(2) agreements for future services;

(3) shared personnel;

(4) bonuses; and

(5) any other method the board determines necessary. (Acts 59th Leg., R.S., Ch. 172, Sec. 11(l).)

Source Law

(l) The Board may, consistent with applicable federal and state laws, recruit and retain physicians, nurses, technicians, and other professional personnel through:

(1) scholarship programs;

(2) agreements for future services;

(3) shared personnel;

(4) bonuses; and

(5) any other method the Board determines is necessary.

Revised Law

Sec. 1072.062. OTHER DISTRICT EMPLOYEES. (a) The board may authorize the employment of persons necessary for the efficient operation of the district.

(b) An employee serves at the will of the board and is subject to rules adopted by the board. (Acts 59th Leg., R.S., Ch. 172, Secs. 11(e) (part), (f).)

Source Law

(e) The Board may:

…

(2) authorize the [appointment, engagement, or] employment of:

(A) employees necessary for the efficient operation of the District; and

…

(f) A person who is [appointed, engaged, or] employed under Subsection (e)(2) serves at the will of the Board and is subject to the rules adopted by the Board.

Revisor's Note

Section 11(e)(2), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, refers to the "appointment, engagement, or employment" of employees and a district administrator. Section 11(f), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, refers to a person who is "appointed, engaged, or employed under Subsection (e)(2)." Those provisions are revised in this section and Section 1072.058(a), which applies to the district administrator. The revised law omits the references to "appointment," "engagement," "appointed," and "engaged" because, in context, those references apply only to the district administrator and not to other district employees.

Revised Law

Sec. 1072.063. RETIREMENT BENEFITS. The board may provide retirement benefits for district employees by:

(1) establishing or administering a retirement program; or

(2) participating in:

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

(B) another statewide retirement system in which the district is eligible to participate. (Acts 59th Leg., R.S., Ch. 172, Sec. 11(m).)

Source Law

(m) The Board may provide retirement benefits for employees of the District by:

(1) establishing or administering a retirement program; or

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

Revised Law

Sec. 1072.064. MAINTENANCE OF RECORDS; PUBLIC INSPECTION. The board shall:

(1) maintain all district records, including books, accounts, notices, minutes, and other matters of the district and its operation, at the district office; and

(2) make those records available for public inspection at reasonable times. (Acts 59th Leg., R.S., Ch. 172, Sec. 11(b).)

Source Law

(b) The Board shall keep all books, records, accounts, notices, minutes, and other matters of the District and its operation at the office of the District. The Board shall make these items available for public inspection at reasonable times.

Revisor's Note

(End of Subchapter)

Section 5(e), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that a director serves until a successor is elected and qualified. The revised law omits this provision because it duplicates Section 17, Article XVI, Texas Constitution. That section provides that an officer in this state is to continue to perform the officer's official duties until a successor has qualified. The omitted law reads:

(e) … In every case, a director shall serve until a successor has been elected and qualified for the office, … .

[Sections 1072.065-1072.100 reserved for expansion]

SUBCHAPTER C. POWERS AND DUTIES

Revised Law

Sec. 1072.101. DISTRICT RESPONSIBILITY. (a) The district has the responsibility of undertaking any measure, consistent with Section 9, Article IX, Texas Constitution, and this chapter, that the board determines is necessary to provide hospital and medical care to the district's needy residents.

(b) The district shall undertake any measure, consistent with Section 9, Article IX, Texas Constitution, and this chapter, that the board determines is necessary to provide hospital and medical care for the district's needy inhabitants. (Acts 59th Leg., R.S., Ch. 172, Sec. 3 (part), as amended Acts 79th Leg., R.S., Chs. 1237, 1351.)

Source Law

Sec. 3. [as amended Acts 79th Leg., R.S., Ch. 1237] The District authorized to be created by this Act is charged with the responsibility of undertaking any measure, consistent with Section 9, Article IX, Texas Constitution, and this Act, that the Board of Directors determines is necessary to provide hospital and medical care to the needy residents of the District… . This District shall undertake any measure, consistent with Section 9, Article IX, Texas Constitution, and this Act, that the Board of Directors determines is necessary to provide hospital and medical care for the needy inhabitants of the District.

Sec. 3. [as amended Acts 79th Leg., R.S., Ch. 1351] The District authorized to be created by this Act is charged with the responsibility of undertaking any measure, consistent with Section 9, Article IX, Texas Constitution, and this Act, that the Board of Directors determines is necessary to provide hospital and medical care to the needy residents of the District… . This District shall undertake any measure, consistent with Section 9, Article IX, Texas Constitution, and this Act, that the Board of Directors determines is necessary to provide hospital and medical care for the needy inhabitants of the District.

Revised Law

Sec. 1072.102. ANNUAL DETERMINATION OF CARE. The board, based on the estimated amount of revenue and balances available to cover the proposed annual budget for the district, may annually determine the type and extent of hospital and medical care services offered by the district. (Acts 59th Leg., R.S., Ch. 172, Sec. 11(n), as amended Acts 79th Leg., R.S., Chs. 1237, 1351.)

Source Law

(n) [as amended Acts 79th Leg., R.S., Ch. 1237] The Board, based on the estimated amount of revenues and balances available to cover the proposed annual budget for the District, may annually determine the type and extent of hospital and medical care services offered by the District.

(n) [as amended Acts 79th Leg., R.S., Ch. 1351] The Board, based on the estimated amount of revenues and balances available to cover the proposed annual budget for the District, may annually determine the type and extent of hospital and medical care services offered by the District.

Revised Law

Sec. 1072.103. 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 to provide hospital service or medical care in the district. (Acts 59th Leg., R.S., Ch. 172, Sec. 3 (part), as amended Acts 79th Leg., R.S., Chs. 1237, 1351.)

Source Law

Sec. 3. [as amended Acts 79th Leg., R.S., Ch. 1237] … 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. 3. [as amended Acts 79th Leg., R.S., Ch. 1351] … 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. …

Revisor's Note

(1) Section 3, Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, as amended by Chapters 1237 and 1351, Acts of the 79th Legislature, Regular Session, 2005, provides that "[a]fter this District is created as provided in Section 4 of this Act," certain political subdivisions may not levy taxes or issue bonds. The revised law omits the quoted language as executed. In addition, throughout this chapter, the revised law substitutes "impose" for "levy" because, in this context, the terms are synonymous and the former is more commonly used.

(2) Section 3, Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, as amended by Chapters 1237 and 1351, Acts of the 79th Legislature, Regular Session, 2005, refers to a "municipality or political subdivision." The revised law omits "municipality" because "municipality" is included in the meaning of "political subdivision."

Revised Law

Sec. 1072.104. MANAGEMENT AND CONTROL OF DISTRICT. The management and control of the district is vested in the board, and the board has full power to manage and control the district. (Acts 59th Leg., R.S., Ch. 172, Secs. 5(a) (part), 11(a) (part).)

Source Law

Sec. 5. (a) The management and control of the District is vested in a Board of Directors … .

Sec. 11. (a) The Board of Directors has full power to manage and control the District. …

Revised Law

Sec. 1072.105. RULES. (a) The board shall adopt rules for the efficient operation of the district, including district facilities.

(b) The board shall:

(1) publish the rules in book form; and

(2) provide copies to interested persons on request at district expense. (Acts 59th Leg., R.S., Ch. 172, Sec. 11(c).)

Source Law

(c) The Board shall adopt rules for the efficient operation of the District and its facilities which are not inconsistent with this Act. The Board shall publish these rules and regulations in book form and furnish copies to interested persons upon request and at the expense of the District.

Revisor's Note

(1) Section 11(c), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that the board shall adopt rules that are "not inconsistent with this Act." The revised law omits the quoted language because, under established principles of law, the board is not authorized to take any action contrary to the laws of this state.

(2) Section 11(c), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, refers to "rules and regulations." The revised law omits "regulations" because under Section 311.005(5), Government Code (Code Construction Act), a rule is defined to include a regulation.

Revised Law

Sec. 1072.106. PURCHASING AND ACCOUNTING PROCEDURES. The board may prescribe the method of making purchases and expenditures and the manner of accounting and control used by the district. (Acts 59th Leg., R.S., Ch. 172, Sec. 11(e) (part).)

Source Law

(e) The Board may:

(1) prescribe the method of making purchases and expenditures and the manner of accounting and control used by the District; and … .

Revised Law

Sec. 1072.107. DISTRICT PROPERTY, FACILITIES, AND EQUIPMENT. (a) The board may:

(1) lease or acquire property, including facilities and equipment, for the use of the district; and

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

(b) The board may sell, lease, or otherwise dispose of property, including facilities or equipment, for the district. Sale or other disposal under this subsection must be at a public sale and at a price and on the terms the board determines are most advantageous to the district.

(c) The board may donate to another governmental entity or to a charitable organization any surplus personal property or equipment if the donation serves a public purpose and is accompanied by adequate consideration. (Acts 59th Leg., R.S., Ch. 172, Secs. 11(o), (p).)

Source Law

(o) The Board may lease or acquire property, facilities, and equipment for the use of the District and may mortgage or pledge the property, facilities, or equipment as security for the payment of the purchase price.

(p) The Board may sell, lease, or otherwise dispose of property, facilities, or equipment on behalf of the District. Sale or other disposal of the property, facilities, or equipment must be at a public sale and at a price and on the terms the Board determines are most advantageous to the District. The Board may donate to another governmental entity or to any charitable organization any surplus personal property or equipment if the donation serves a public purpose and is accompanied by adequate consideration.

Revised Law

Sec. 1072.108. EMINENT DOMAIN. (a) The district may exercise the power of eminent domain to acquire a fee simple or other interest in real, personal, or mixed property located in district territory if the interest is necessary or convenient for the district to exercise a power or duty conferred on the district by this chapter.

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

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

(2) provide a bond for costs or a supersedeas bond on an appeal or petition for review. (Acts 59th Leg., R.S., Ch. 172, Sec. 14.)

Source Law

Sec. 14. (a) The District has the power of eminent domain for the purpose of acquiring by condemnation any interest, including fee simple absolute, in any real, personal, or mixed property within the boundaries of the District that is necessary or convenient to the exercise of the powers and duties conferred upon it by this Act.

(b) The Board shall exercise this power of eminent domain in the same manner as provided by general law. However, the District is not required to make deposits in the registry of the trial court or to post bond as required by Paragraph 2, Article 3268, Revised Civil Statutes of Texas, 1925, as amended.

(c) The District is not required to pay in advance or to give any bond or other security for costs in the trial court otherwise required for the issuance relating to a condemnation proceeding, nor is it required to give a bond for costs or for supersedeas on an appeal or writ of error proceeding to a Court of Civil Appeals or to the Supreme Court.

Revisor's Note

(1) Section 14(a), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that the district has the "power of eminent domain for the purpose of acquiring [property] by condemnation." The revised law substitutes for the quoted language "may exercise the power of eminent domain to acquire [property]" because the phrases have the same meaning and the latter phrase is consistent with modern usage in laws relating to eminent domain.

(2) Section 14(b), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that the district must exercise the power of eminent domain in the manner provided by "general law." 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.

(3) Section 14(b), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, refers to "Paragraph 2, Article 3268, Revised Civil Statutes of Texas, 1925, as amended." That statute was codified in 1983 as Section 21.021(a), Property Code. The revised law is drafted accordingly. In addition, throughout this chapter, the revised law omits the reference to "as amended" because under Section 311.027, Government Code (Code Construction Act), a reference to a statute applies to all reenactments, revisions, or amendments of that statute unless expressly provided otherwise.

(4) Section 14(c), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, refers to an "appeal or writ of error proceeding to a Court of Civil Appeals or to the Supreme Court." 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, Rules of Appellate Procedure. In addition, the revised law omits the references to the courts because those are the only courts to which the district may appeal or petition for review.

Revised Law

Sec. 1072.109. GIFTS AND ENDOWMENTS. The board may accept for the district a gift or endowment to be held in trust and administered by the board under the directions, limitations, or other provisions prescribed in writing by the donor that are not inconsistent with the proper management of the district. (Acts 59th Leg., R.S., Ch. 172, Sec. 11(h).)

Source Law

(h) The Board may accept donations, gifts, and endowments for the District. The Board shall hold all donations, gifts, and endowments in trust and shall administer them under any direction, limitation, or provisions as may be prescribed in writing by the donor, as long as it is not inconsistent with the proper management of the District.

Revisor's Note

Section 11(h), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, refers to "donations" and "gifts." The revised law omits "donations" because "donations" is included in the meaning of "gifts."

Revised Law

Sec. 1072.110. CONSTRUCTION CONTRACTS. (a) The board may enter into construction contracts for the district.

(b) A construction contract awarded by the district that involves the expenditure of more than the amount provided by Section 271.024, Local Government Code, must be competitively bid as provided by Subchapter B, Chapter 271, Local Government Code. (Acts 59th Leg., R.S., Ch. 172, Sec. 11(q) (part).)

Source Law

(q) The Board may enter into construction contracts on behalf of the District. A construction contract awarded by the District for more than $15,000 must be competitively bid, as provided by Subchapter B, Chapter 271, Local Government Code… .

Revisor's Note

(1) Section 11(q), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that contracts awarded by the district that involve spending more than $15,000 must be competitively bid as provided by Subchapter B, Chapter 271, Local Government Code. The revised law omits the reference to the $15,000 amount as superseded by Section 5, Chapter 115, Acts of the 77th Legislature, Regular Session, 2001, which amended Section 271.024, Local Government Code, to increase the contract amount for which competitive bidding is required to $25,000.

(2) Section 11(q), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that Chapter 2253, Government Code, applies to the district's construction contracts. The revised law omits the provision because Chapter 2253 applies to the district on its own terms. The omitted law reads:

(q) … Chapter 2253, Government Code, applies to construction contracts let by the District.

Revised Law

Sec. 1072.111. OPERATING AND MANAGEMENT CONTRACTS. The board may enter into an operating or management contract relating to hospital services or medical care the district is authorized to provide. (Acts 59th Leg., R.S., Ch. 172, Sec. 11(r).)

Source Law

(r) The Board may enter into operating or management contracts with respect to any of the hospital services or medical care that the District may provide.

Revised Law

Sec. 1072.112. CONTRACTS WITH POLITICAL SUBDIVISIONS OR GOVERNMENT AGENCIES FOR HOSPITAL AND MEDICAL CARE. The board may contract with a municipality or other political subdivision or a state or federal agency to provide hospital and medical care for needy persons who reside outside the district. (Acts 59th Leg., R.S., Ch. 172, Sec. 11(i).)

Source Law

(i) The Board may enter into any contract with a municipality or other political subdivision or with a state or federal agency to provide hospital and medical care for needy persons who reside outside the District.

Revised Law

Sec. 1072.113. PAYMENT FOR TREATMENT; PROCEDURES. (a) A person who resides in the district is entitled to receive necessary medical and hospital care regardless of whether the person has the ability to pay for the care and may apply to receive this care without cost.

(b) The board or the district administrator shall employ a person to investigate the ability of the patient and any relative who is liable for the patient's support to pay for the medical and hospital care received by the patient.

(c) If the district determines that the patient or relative legally liable for the patient's support cannot pay all or part of the costs of the patient's care, the expense of the care becomes a charge against the district.

(d) If the patient or a relative legally liable for the patient's support can pay for all or part of the costs of the patient's care, the board shall order the patient or relative to pay to the district each week an amount specified in the order. The amount must be proportionate to the person's ability to pay.

(e) The district administrator may collect the amount from the patient's estate, or from any relative who is 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.

(f) If there is a dispute as to the ability to pay, the board shall hold a hearing and, after calling witnesses, shall:

(1) determine the question; and

(2) make the proper order based on the board's findings.

(g) A party to the hearing who is not satisfied with the result of the order may appeal to the district court. The substantial evidence rule applies to the appeal. (Acts 59th Leg., R.S., Ch. 172, Sec. 13.)

Source Law

Sec. 13. (a) A person who resides within the District is entitled to receive necessary medical and hospital care whether he has the ability to pay for the care or not. A person who resides within the District may make application to receive this care without cost.

(b) The Board or the administrator shall employ a person to investigate the ability of the patient and the ability of any relative who is liable for the support of the patient to pay for the medical and hospital care which the patient receives.

(c) If the patient or a relative of the patient who is legally liable for his support is able to pay for this care in whole or in part, the Board shall order the patient or his relatives to pay to the District each week an amount specified in the order. The amount must be in proportion to the ability to pay.

(d) The administrator may collect this amount from the estate of the patient, or from his relatives who are liable for his support, in the manner provided by law for the collection of expenses of the last illness of a deceased person.

(e) If the District finds that neither the patient, nor a relative who is legally liable for his support, is able to pay in whole or in part for this care, the expense of this care becomes a charge on the District.

(f) If there is a dispute as to the ability to pay, the Board shall hear and determine the question, after calling witnesses, and make the proper order based on its findings.

(g) A party to the hearing who is not satisfied with the result of the order may appeal to the district court, and the substantial evidence rule applies to that appeal.

Revised Law

Sec. 1072.114. REIMBURSEMENT FOR SERVICE. (a) The board shall require a county, municipal, or other public hospital located outside the district to reimburse the district for the district's care and treatment of a patient of that hospital as provided by Chapter 61, Health and Safety Code.

(b) The board shall require the sheriff of Maverick County or the police chief of a municipality in the district to reimburse the district for the district's care and treatment of a person who is confined in a jail facility of the county or municipality and is not a resident of the district. (Acts 59th Leg., R.S., Ch. 172, Sec. 11(j).)

Source Law

(j) The Board shall require:

(1) reimbursement from the sheriff of Maverick County or the police chief of a municipality in the District for the District's care and treatment of a person confined in a jail facility of the county or municipality who is not a resident of the District; and

(2) reimbursement from a county, municipal, or other public hospital located outside the boundaries of the District for the District's care and treatment of a patient of that hospital, as provided by Chapter 61, Health and Safety Code.

Revised Law

Sec. 1072.115. CHARITABLE ORGANIZATION. (a) In this section, "charitable organization" means an organization that is exempt from federal income tax under Section 501(a) of the Internal Revenue Code of 1986 by being listed as an exempt organization in Section 501(c)(3) or 501(c)(4) of the code.

(b) The board may facilitate the achievement of district purposes by creating a charitable organization to:

(1) provide or arrange for hospital and health care services;

(2) develop resources for hospital and health care services; and

(3) provide ancillary support services for the district.

(c) A charitable organization created under this section is a unit of local government for purposes of Chapter 101, Civil Practice and Remedies Code. (Acts 59th Leg., R.S., Ch. 172, Secs. 11(s), (u).)

Source Law

(s) The Board may facilitate achievement of the purpose of the District by creating a charitable organization to provide or arrange for hospital and health care services, develop resources for hospital and health care services, and provide ancillary support services for the District. A charitable organization created by the Board under this subsection is a unit of local government for purposes of Chapter 101, Civil Practice and Remedies Code.

(u) In this section, "charitable organization" means an organization that is exempt from federal income tax under Section 501(a) of the Internal Revenue Code of 1986, as amended, by being listed as an exempt organization in Section 501(c)(3) or 501(c)(4) of the code.

Revised Law

Sec. 1072.116. NONPROFIT CORPORATION. (a) The board, on the district's behalf, 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 money, other than money the corporation pays to the district, 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 adequate controls to ensure that the corporation uses its money as required by this section. (Acts 59th Leg., R.S., Ch. 172, Sec. 11(t).)

Source Law

(t) The Board, on behalf of 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 funds, other than funds paid by the corporation to the District, only to provide health care or other services the District may provide under this Act. The Board 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 11(t), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, 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. On January 1, 2010, the Texas Non-Profit Corporation Act expires, and, as of that date, the Business Organizations Code applies to all business entities. The revised law is drafted accordingly.

Revisor's Note

(End of Subchapter)

(1) Section 11(a), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, states that a provision of the act that provides a specific power or duty does not limit the district's general authority to carry out the purposes of the act. The revised law omits this provision because it is a generally accepted principle of statutory interpretation that all of a statute is intended to be given effect and that specific grants of power do not limit more general grants of power. Additionally, Section 311.021(2), Government Code (Code Construction Act), provides that an entire statute is intended to be effective. The omitted law reads:

(a) … Any provision of this Act which provides a specific power or duty does not limit the general authority of the District to carry out the purposes of this Act.

(2) Section 16, Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides authority for the "State Board of Health, the State Board of Public Welfare, or any other state agency created for a similar purpose" to inspect hospital district facilities and records. The revised law omits Section 16 because various state laws, including Chapters 222 and 241, Health and Safety Code, provide the necessary inspection authority to appropriate state agencies. The omitted law reads:

Sec. 16. (a) The District is subject to inspection at any time by an authorized representative of the State Board of Health, the State Board of Public Welfare, or any other state agency created for a similar purpose.

(b) The administrator of the hospital shall admit a representative into the facilities of the District and make accessible on demand all District records, reports, books, papers, and accounts.

[Sections 1072.117-1072.150 reserved for expansion]

SUBCHAPTER D. GENERAL FINANCIAL PROVISIONS

Revised Law

Sec. 1072.151. BUDGET. The district administrator shall prepare a proposed budget that includes:

(1) proposed expenditures and disbursements;

(2) estimated receipts and collections for the next fiscal year; and

(3) the amount of taxes required to be imposed to meet the proposed budget. (Acts 59th Leg., R.S., Ch. 172, Sec. 12(b).)

Source Law

(b) The administrator shall prepare a proposed budget showing:

(1) the proposed expenditures and disbursements;

(2) the estimated receipts and collections for the next fiscal year; and

(3) the amount of taxes required to be levied and collected during the next fiscal year to meet the proposed budget.

Revisor's Note

Section 12(b), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, refers to taxes "levied and collected." The revised law substitutes "imposed" for the quoted language because "impose" is the term generally used in Title 1, Tax Code, and includes the levying and collection of an ad valorem tax.

Revised Law

Sec. 1072.152. ADOPTION OF PROPOSED BUDGET: NOTICE AND HEARING. (a) The board shall hold a public hearing on the proposed budget.

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

(1) appear at the hearing; and

(2) be heard regarding any item in the proposed budget.

(d) At the conclusion of the hearing, the board shall adopt a budget for the district that includes any changes to the proposed budget that the board determines are in the best interest of the district. (Acts 59th Leg., R.S., Ch. 172, Secs. 12(c), (d), (e).)

Source Law

(c) The Board shall hold a public hearing on the proposed budget after publication of notice in a newspaper of general circulation in the District. The notice must be given at least once not less than 10 days prior to the hearing.

(d) Any resident of the District is entitled to appear at the hearing and be heard with reference to any item in the proposed budget.

(e) At the conclusion of the hearing, the Board shall adopt a budget for the District that includes any changes to the administrator's proposed budget that the Board determines are in the best interest of the District.

Revised Law

Sec. 1072.153. FISCAL YEAR. The district's fiscal year is from September 1 through August 31. (Acts 59th Leg., R.S., Ch. 172, Sec. 12(a).)

Source Law

Sec. 12. (a) The fiscal year of the hospital district is from September 1 of each year through August 31 of the following year.

Revised Law

Sec. 1072.154. ANNUAL AUDIT. (a) The board annually shall require an independent audit of the district's books and records.

(b) Not later than January 1 of each year, the board shall:

(1) file a copy of the audit with the district; and

(2) provide a copy of the audit at each public library located in the district. (Acts 59th Leg., R.S., Ch. 172, Sec. 11(d).)

Source Law

(d) The Board shall require an annual independent audit of the books and records of the District and shall file a copy of the audit with the District and shall provide a copy of the audit at each public library located in the District not later than January 1 of each year.

Revised Law

Sec. 1072.155. DEPOSITORY. (a) The board by resolution shall designate a bank in Maverick County as the district's depository. A designated bank serves for two years and until a successor is designated.

(b) All district money shall be deposited in the depository and secured in the manner provided for securing county funds. (Acts 59th Leg., R.S., Ch. 172, Sec. 15.)

Source Law

Sec. 15. Within 30 days after the qualification of the Board of Directors, the Board shall by resolution designate a bank within the county in which the District is located to be the depository of the District. All funds of the District shall be deposited in the depository and shall be secured in the manner now provided for the security of county funds. The depository shall serve for a period of two years and until a successor has been named in accordance with this section.

Revisor's Note

(1) Section 15, Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, requires the board to select a depository "[w]ithin 30 days after the qualification of the Board of Directors." The revised law omits the quoted language as executed.

(2) Section 15, Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, refers to the bank in "the county in which the District is located." Throughout this chapter, the revised law substitutes "Maverick County" for the quoted language because that is the county in which the district is located.

Revised Law

Sec. 1072.156. AUTHORITY TO BORROW MONEY; SECURITY. (a) The board may borrow money at a rate of not more than 10 percent a year on district notes to pay the obligations if the board declares that money is not available to meet authorized district obligations, which creates an emergency.

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

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

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

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

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

(d) Money obtained from a loan under this section may be spent only for:

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

(2) if district taxes or bonds are pledged to pay the loan, the purposes for which the taxes were imposed or the bonds were authorized. (Acts 59th Leg., R.S., Ch. 172, Sec. 11A.)

Source Law

Sec. 11A. (a) The Board may declare that funds are not available to meet lawfully authorized obligations of the District, thereby creating an emergency, and may borrow money at a rate of not more than 10 percent a year on notes of the District to pay the obligations.

(b) To secure the loan, the Board may pledge revenues of the District that are not pledged to pay any bonded indebtedness of the District, taxes of the District to be levied by the District in the succeeding 12-month period that are not pledged to pay principal of or interest on bonds of the District, or bonds of the District that have been authorized but not sold.

(c) If taxes or bonds are pledged to pay the loan, the loan shall mature not later than 12 months from the date the loan is made.

(d) If revenues of the District are pledged for payment of the loan, the loan shall mature not more than five years after the date the loan is made.

(e) No money obtained from a loan under this section may be spent for any purpose other than the purpose for which the Board declared an emergency and, if taxes or bonds are pledged to pay the loan, for any purposes other than the purposes for which the pledged taxes were levied or the pledged bonds were authorized.

[Sections 1072.157-1072.200 reserved for expansion]

SUBCHAPTER E. BONDS

Revised Law

Sec. 1072.201. BONDS. The district may issue bonds to:

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

(2) equip buildings for hospital purposes. (Acts 59th Leg., R.S., Ch. 172, Sec. 9(a) (part).)

Source Law

(a) … the District may issue bonds for the purchase, construction, acquisition, repair, or renovation of buildings and improvements, and for equipping the buildings for hospital purposes… .

Revisor's Note

Section 9(a), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, authorized the commissioners court to order a bond election at the election to create the district. The revised law omits that provision as executed because the creation election has been conducted. The omitted law reads:

Sec. 9. (a) At the time of the election to create the District the commissioners court may order an election to determine whether [the District may issue bonds] … .

Revised Law

Sec. 1072.202. TAX TO PAY GENERAL OBLIGATION BONDS. The board may issue general obligation bonds only if the board imposes 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. (Acts 59th Leg., R.S., Ch. 172, Sec. 10(b).)

Source Law

(b) The Board may not issue any general obligation bonds unless a sufficient tax is levied to create an interest and sinking fund to pay the interest and principal as it matures.

Revisor's Note

Section 10(b), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, 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. 1072.203. BOND ELECTION. (a) The board may issue general obligation bonds only if the bonds are authorized by a majority of district voters voting in an election held for that purpose.

(b) The board may order a bond election at any time.

(1) the time of the election;

(2) the location of the polling places;

(3) the form of the ballot;

(4) the presiding judge for each polling place;

(5) the purpose of the bond issuance;

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

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

(8) the maximum maturity of the bonds.

(d) A substantial copy of the election order shall be published in a newspaper of general circulation in the district once a week for two consecutive weeks before the date of the election. The first notice must be published at least 14 days before the date of the election.

(e) A copy of the election results must be filed with the county clerk and become a public record. (Acts 59th Leg., R.S., Ch. 172, Secs. 4(c), (d), (e) (part), 9(a) (part), (b), (d) (part).)

Source Law

[Sec. 4]

(c) The order calling the election must contain the time and place, or places, of holding the election, the form of the ballot, and the presiding judge for each voting place.

(d) The commissioners court shall publish a substantial copy of the election order in a newspaper of general circulation within the District once a week for two consecutive weeks prior to the date of the election. The first notice must be published at least 14 days before the date of the election.

(e) … A copy of the results are to be filed with the County Clerk and become of public record… .

Sec. 9. (a) … If the commissioners court does not include this election in the order for the election to create the District, the Board of Directors may order this election at any time.

(b) The order and notice of election and the certification declaration of the results to the County Clerk are governed by Section 4 of this Act. In addition to the provisions of that section, the order of this election must include:

(1) the purpose for which the bonds are to be issued;

(2) the amount of the proposed bond issue;

(3) the maximum interest rate;

(4) the maximum maturity date of the bonds.

(d) The Board of Directors shall not issue any general obligation bonds until a majority of the qualified electors of the District voting in an election for this purpose vote for the issuance of these bonds… .

Revisor's Note

(1) Sections 4(e) and 9(d), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provide that the presiding judge of each voting place shall count the votes and certify the results to the commissioners court within 10 days, and that the board shall canvass the returns and declare the results of the election. The revised law omits those provisions as superseded by Sections 67.002, 67.003, and 67.004, Election Code (enacted by Section 1, Chapter 211, Acts of the 69th Legislature, Regular Session, 1985), which require the governing body of a political subdivision that orders an election to canvass the returns and provides the time frame and procedures for the canvass. The omitted law reads:

[Sec. 4]

(e) The presiding judge of each voting place shall supervise the counting of all votes cast and shall certify the results to the commissioners court within 10 days after the election. …

[Sec. 9]

(d) … In any election held for the purpose of approving the issuance of general obligation bonds, the Board shall canvass the returns and declare the results of the election.

(2) Section 9(d), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, refers to "qualified electors 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. The revised law substitutes "voter" for "elector" because the former is the term used in the Election Code.

Revised Law

Sec. 1072.204. REVENUE BONDS. (a) The district may issue revenue bonds to:

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

(2) acquire real property for district purposes.

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

(c) The bonds must be issued in the manner provided by Sections 264.042, 264.043, 264.044, 264.045, 264.046, 264.047, 264.048, and 264.049, Health and Safety Code, for issuance of revenue bonds by a county hospital authority. (Acts 59th Leg., R.S., Ch. 172, Secs. 10(d), (e), (f).)

Source Law

(d) The District may issue revenue bonds to:

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

(2) acquire real property for District purposes.

(e) The revenue bonds issued under Subsection (d) must be payable from and secured by a pledge of all or part of the District's revenues from operations of the hospital system.

(f) The revenue bonds issued under Subsection (d) must be issued in accordance with Sections 264.042, 264.043, 264.044, 264.045, 264.046, 264.047, 264.048, and 264.049, Health and Safety Code, for the issuance of revenue bonds by county hospital authorities.

Revised Law

Sec. 1072.205. REFUNDING BONDS. (a) The board may issue refunding bonds to refund outstanding indebtedness issued or assumed by the district.

(b) A refunding bond may be:

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

(2) exchanged wholly or partly for not less than a similar principal amount of outstanding indebtedness. (Acts 59th Leg., R.S., Ch. 172, Sec. 10(g) (part).)

Source Law

(g) The District may issue refunding bonds to refund an outstanding indebtedness the District has issued or assumed. … The refunding bonds may be sold and the proceeds applied to the payment of outstanding indebtedness or may be exchanged in whole or in part for not less than a similar principal amount of outstanding indebtedness… .

Revisor's Note

Section 10(g), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that refunding bonds must be issued in the manner provided by Chapter 784, Acts of the 61st Legislature, Regular Session, 1969 (Article 717k-3, Vernon's Texas Civil Statutes). In addition, the section provides that refunding bonds sold to pay outstanding indebtedness must be issued and payments made in the manner provided by Chapter 503, Acts of the 54th Legislature, Regular Session, 1955 (Article 717k, Vernon's Texas Civil Statutes). Articles 717k and 717k-3 were codified in 1999 as Chapter 1207, Government Code. The revised law omits the provisions because Chapter 1207, Government Code, applies to district bonds by application of Section 1207.001, Government Code. The omitted law reads:

(g) … The bonds must be issued in the manner provided by Chapter 784, Acts of the 61st Legislature, Regular Session, 1969 (Article 717k-3, Vernon's Texas Civil Statutes). … If the refunding bonds are to be sold and the proceeds applied to the payment of outstanding indebtedness, the refunding bonds must be issued and payments made in the manner provided by Chapter 503, Acts of the 54th Legislature, Regular Session, 1955 (Article 717k, Vernon's Texas Civil Statutes).

Revised Law

Sec. 1072.206. MATURITY OF BONDS. District bonds must mature not later than 50 years after the date of issuance. (Acts 59th Leg., R.S., Ch. 172, Sec. 9(c) (part).)

Source Law

Revised Law

Sec. 1072.207. EXECUTION OF BONDS. (a) The board president shall execute the district's bonds in the district's name.

(b) The board secretary shall countersign the bonds. (Acts 59th Leg., R.S., Ch. 172, Sec. 10(a) (part).)

Source Law

Sec. 10. (a) The president of the Board shall execute the bonds in the name of and on behalf of the hospital district. The secretary of the Board of Directors shall countersign the bonds… .

Revisor's Note

Section 10(a), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that district bonds are subject to the law governing counties that relates to bond approval by the attorney general and registration of the bonds by the comptroller. Section 10(a) also provides that after approval and registration the bonds are "incontestable for any reason." The revised law omits those provisions because they duplicate, in substance, 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:

(a) … The Attorney General of the State of Texas shall approve the bonds if they meet the same requirements as provided by law for bonds issued by a county. The bonds are to be registered by the Comptroller of Public Accounts of the State of Texas in the same manner as provided by law for the registration of bonds issued by a county. After approval and registration the bonds are incontestable for any reason.

Revised Law

Sec. 1072.208. BONDS EXEMPT FROM TAXATION. The following are exempt from taxation by this state or a political subdivision of this state:

(1) bonds issued by the district;

(2) any transaction relating to the bonds; and

(3) profits made in the sale of the bonds. (Acts 59th Leg., R.S., Ch. 172, Sec. 10(j) (part).)

Source Law

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

Revisor's Note

Section 10(j), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, refers to "any municipality, county, special district, or other political subdivision of the state." The revised law omits "municipality," "county," and "special district" because those terms are included in the meaning of "political subdivision of the state."

Revisor's Note

(End of Subchapter)

(1) Section 9(c), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that district bonds must bear interest at a rate that does not exceed the rate provided by Chapter 3, Acts of the 61st Legislature, Regular Session, 1969 (Article 717k-2, Vernon's Texas Civil Statutes). The revised law omits that provision because the maximum interest rate noted in Chapter 3 was revised in 1999 as Section 1204.006, Government Code, and Section 1204.006 applies to district bonds by application of Section 1204.001, Government Code. The omitted law reads:

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

(2) Section 10(c), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that district bonds may be made optional for redemption before maturity. The revised law omits this provision because Section 1201.021, Government Code, provides that a public security may be issued as redeemable before maturity at one or more specified times. Section 1201.021, Government Code, applies to district bonds by application of Section 1201.002, Government Code. The omitted law reads:

(c) All bonds issued by the District may be made optional for redemption prior to their maturity date in the discretion of the Board.

(3) Section 10(h), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that district bonds are legal and authorized investments for certain entities. The revised law omits the provision as unnecessary. As to several of the entities listed, Section 10(h) has been superseded and impliedly repealed or it duplicates existing law. Investments in securities by banks are regulated by Section 34.101, Finance Code (enacted in 1995 as Section 5.101, Texas Banking Act (Article 342-5.101, Vernon's Texas Civil Statutes)). Investments in securities by savings banks are regulated by Section 93.001(c)(10), Finance Code (enacted in 1993 as Section 7.15(10), Texas Savings Bank Act (Article 489e, Vernon's Texas Civil Statutes)). Investments in securities by trust companies are regulated by Section 184.101, Finance Code (enacted in 1997 as Section 5.101, Texas Trust Company Act (Article 342a-5.101, Vernon's Texas Civil Statutes)). Investments in securities by savings and loan associations are regulated by Sections 63.002 and 64.001, Finance Code. As to the remaining entities listed, Section 10(h) duplicates 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), and last amended in 2007), 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:

(h) District bonds and indebtedness assumed by the District are legal and authorized investments for:

(1) banks;

(2) savings banks;

(3) trust companies;

(4) savings and loan associations;

(5) insurance companies;

(6) fiduciaries;

(7) trustees;

(8) guardians; and

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

(4) Section 10(i), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that district bonds may secure deposits of public funds of this state or political subdivisions of this state. The revised law omits the provisions relating to deposits of state funds by the comptroller because they duplicate, in substance, Section 404.0221, Government Code (enacted in 1995), which lists eligible collateral for deposits of state funds by the comptroller. As to deposits of other funds, this provision duplicates Chapter 2257, Government Code, which governs eligible collateral for deposits of funds of political subdivisions, and permits those deposits to be secured by obligations issued by hospital districts. The omitted law reads:

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

[Sections 1072.209-1072.250 reserved for expansion]

SUBCHAPTER F. TAXES

Revised Law

Sec. 1072.251. IMPOSITION OF AD VALOREM TAX. (a) The board shall impose a tax on all property in the district subject to district taxation.

(b) The tax may be used only to:

(1) pay the interest on and create a sinking fund for bonds issued under this chapter;

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

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

(4) acquire sites for additions to the hospital system; and

(5) pay the indebtedness issued or assumed by the district. (Acts 59th Leg., R.S., Ch. 172, Secs. 8(a) (part), (c).)

Source Law

(a) … the Board of Directors shall levy a tax … on all property subject to taxation within the District.

(1) paying the interest on and creating a sinking fund for bonds issued under the provisions of this Act;

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

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

(4) acquiring sites for the additions to the hospital system; and

(5) paying the indebtedness issued or assumed by the District.

Revisor's Note

Section 8(a), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that the board shall impose a tax after a vote. The revised law omits this provision as executed. The omitted law reads:

Sec. 8. (a) After a majority of those persons voting at the election vote for the levy of a tax, [the Board of Directors shall levy a tax] … .

Revised Law

Sec. 1072.252. TAX RATE. The board may impose the tax at a rate not to exceed 50 cents on each $100 valuation of all taxable property in the district. (Acts 59th Leg., R.S., Ch. 172, Sec. 8(a) (part).)

Source Law

(a) … [the Board of Directors shall levy a tax] not to exceed 50 cents on the $100 valuation on all property subject to taxation within the District.

Revised Law

Sec. 1072.253. TAX ASSESSOR-COLLECTOR. The tax assessor-collector for Maverick County shall collect taxes for the district. (Acts 59th Leg., R.S., Ch. 172, Sec. 8(d) (part).)

Source Law

(d) … [the tax assessor and collector of the county in which the District is located.] The tax assessor and collector of that county shall collect the taxes for the District. …

Revisor's Note

(End of Subchapter)

(1) Sections 8(b) and (d), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, require the board to impose taxes at a certain time and in a certain manner. The revised law omits those provisions because they were repealed by Section 6(b), Chapter 841, Acts of the 66th Legislature, Regular Session, 1979, which repealed all "general, local, and special laws" that conflicted with that act. The 1979 act enacted the Property Tax Code (Title 1, Tax Code), a comprehensive, substantive codification of property tax law and its administration. Title 1, Tax Code, provides the exclusive procedures for the appraisal of property for taxation by a taxing unit, including a hospital district. The omitted law reads:

(b) The board shall use the same valuation used by the commissioners court in taxing the property for county purposes which appears on the county tax rolls.

(d) On or before October 1 of each year, the Board shall levy the tax and immediately certify the tax rate to the tax assessor and collector of the county in which the District is located… . The taxes of the District are subject to the same conditions as the taxes of the county.

(2) Section 8(e), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that the county tax assessor-collector is entitled to a fee as compensation for services. The revised law omits that provision because it was repealed by Section 6(b), Chapter 841, Acts of the 66th Legislature, Regular Session, 1979. See Revisor's Note (1). Section 6.27(b), Tax Code, provides for the compensation of a county tax assessor-collector assessing and collecting taxes for another taxing unit. The omitted law reads:

(e) The assessor and collector of taxes is entitled to a fee as compensation for his services of not more than one per cent of the total tax collected. The Board shall fix the exact amount of compensation. The tax assessor and collector shall deduct this fee from the payments made to the District of the taxes collected, and deposit that amount in the general fund of the county as a fee of office of the tax assessor and collector.

(3) Section 8(f), Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, 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:

(f) The Board may levy this tax for the entire year in which the District is established to secure funds necessary to initiate the operation of the hospital district.

Revisor's Note

(End of Chapter)

Section 18, Chapter 172, Acts of the 59th Legislature, Regular Session, 1965, provides that proper notice of enactment of the statute was provided in a manner that satisfies the requirements of the Texas Constitution. The revised law omits the provision as executed. The omitted law reads:

Sec. 18. The Legislature has found that proper notice has been given in the District affected by this Act in accordance with the requirement of Section 9, Article IX, Constitution of the State of Texas.


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