TLC: Special District Local Laws Code Proposed Chapters

81C5(4) MCK

CHAPTER 1077. GAINESVILLE HOSPITAL DISTRICT

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 1077.001. DEFINITIONS ............................... 3

Sec. 1077.002. AUTHORITY FOR OPERATION ................... 3

Sec. 1077.003. POLITICAL SUBDIVISION ..................... 4

Sec. 1077.004. DISTRICT TERRITORY ........................ 4

Sec. 1077.005. PUBLIC PURPOSE; TAX EXEMPTION ............. 4

Sec. 1077.006. DISTRICT SUPPORT AND MAINTENANCE NOT

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

Sec. 1077.007. RESTRICTION ON STATE FINANCIAL

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

[Sections 1077.008-1077.050 reserved for expansion]

SUBCHAPTER B. DISTRICT ADMINISTRATION

Sec. 1077.051. BOARD ELECTION; TERM ...................... 7

Sec. 1077.052. NOTICE OF ELECTION ........................ 7

Sec. 1077.053. QUALIFICATIONS FOR OFFICE ................. 8

Sec. 1077.054. MEETING ATTENDANCE REQUIREMENT ............ 8

Sec. 1077.055. BOARD VACANCY ............................. 9

Sec. 1077.056. OFFICERS .................................. 9

Sec. 1077.057. COMPENSATION; EXPENSES .................... 9

Sec. 1077.058. DISTRICT ADMINISTRATOR; ASSISTANT

ADMINISTRATOR ........................... 10

Sec. 1077.059. GENERAL DUTIES OF DISTRICT

ADMINISTRATOR ........................... 10

Sec. 1077.060. APPOINTMENT AND DISMISSAL OF STAFF AND

EMPLOYEES ............................... 11

Sec. 1077.061. PERSONNEL CONTRACTS ....................... 11

Sec. 1077.062. RETIREMENT BENEFITS ....................... 12

[Sections 1077.063-1077.100 reserved for expansion]

SUBCHAPTER C. POWERS AND DUTIES

Sec. 1077.101. DISTRICT RESPONSIBILITY ................... 13

Sec. 1077.102. RESTRICTION ON POLITICAL SUBDIVISION

TAXATION AND DEBT ....................... 13

Sec. 1077.103. MANAGEMENT, CONTROL, AND ADMINISTRATION ... 14

Sec. 1077.104. RULES ..................................... 14

Sec. 1077.105. PURCHASING AND ACCOUNTING PROCEDURES ...... 15

Sec. 1077.106. DISTRICT PROPERTY, FACILITIES,

EQUIPMENT, AND SERVICES ................. 16

Sec. 1077.107. EMINENT DOMAIN ............................ 16

Sec. 1077.108. GIFTS AND ENDOWMENTS ...................... 17

Sec. 1077.109. CONTRACTS WITH GOVERNMENTAL ENTITIES

FOR CARE AND TREATMENT .................. 18

Sec. 1077.110. PAYMENT FOR TREATMENT; PROCEDURES ......... 19

Sec. 1077.111. AUTHORITY TO SUE AND BE SUED .............. 20

[Sections 1077.112-1077.150 reserved for expansion]

SUBCHAPTER D. GENERAL FINANCIAL PROVISIONS

Sec. 1077.151. BUDGET .................................... 21

Sec. 1077.152. PROPOSED BUDGET; NOTICE AND HEARING ....... 21

Sec. 1077.153. FISCAL YEAR ............................... 22

Sec. 1077.154. AUDIT ..................................... 22

Sec. 1077.155. FINANCIAL REPORT .......................... 23

Sec. 1077.156. DEPOSITORY ................................ 23

[Sections 1077.157-1077.200 reserved for expansion]

SUBCHAPTER E. BONDS

Sec. 1077.201. BONDS ..................................... 24

Sec. 1077.202. TAX TO PAY BONDS .......................... 25

Sec. 1077.203. BOND ELECTION ............................. 26

Sec. 1077.204. REVENUE BONDS ............................. 28

Sec. 1077.205. MATURITY OF TAX BONDS ..................... 29

Sec. 1077.206. EXECUTION OF BONDS ........................ 29

[Sections 1077.207-1077.250 reserved for expansion]

SUBCHAPTER F. TAXES

Sec. 1077.251. IMPOSITION OF AD VALOREM TAX .............. 34

Sec. 1077.252. TAX RATE .................................. 35

Sec. 1077.253. TAX ASSESSOR-COLLECTOR .................... 36

CHAPTER 1077. GAINESVILLE HOSPITAL DISTRICT

SUBCHAPTER A. GENERAL PROVISIONS

Revised Law

Sec. 1077.001. 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 Gainesville 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. 1077.002. AUTHORITY FOR OPERATION. The Gainesville Hospital District operates in accordance with Section 9, Article IX, Texas Constitution. (Acts 64th Leg., R.S., Ch. 211, Sec. 1 (part).)

Source Law

Sec. 1. In accordance with the provisions of the Texas Constitution, Article IX, Section 9, this Act hereby authorizes the creation, establishment, maintenance, and operation of a hospital district within the State of Texas to be known as the Gainesville Hospital District and … .

Revisor's Note

Section 1, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, authorizes the "creation, establishment, maintenance, and operation" of the district. The revised law omits "creation" and "establishment" as executed. The revised law omits "maintenance" because, in this context, the meaning of that term is included in the meaning of "operation."

Revised Law

Sec. 1077.003. POLITICAL SUBDIVISION. The district is a political subdivision of this state. (Acts 64th Leg., R.S., Ch. 211, Sec. 17 (part).)

Source Law

Sec. 17. The hospital district authorized to be created under the provisions of this Act shall be and is declared to be a political subdivision of the State of Texas, and … .

Revised Law

Sec. 1077.004. DISTRICT TERRITORY. The boundaries of the district are coextensive with the boundaries of Cooke County, Texas, except that the district does not include territory located in the Muenster Hospital District on the date the election to approve the creation of the Gainesville Hospital District was called. (Acts 64th Leg., R.S., Ch. 211, Sec. 1 (part).)

Source Law

Sec. 1. … to include within its boundaries all the territory located within Cooke County, Texas, except that territory which at the time the election to approve the creation of such district is called (as provided in Section 3 hereof) is within the Muenster Hospital District.

Revisor's Note

Section 1, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, refers to the election to approve creation of the district "as provided in Section 3." As explained in the revisor's note to the end of this subchapter, Section 3, Chapter 211, is executed. The revised law therefore omits the reference.

Revised Law

Sec. 1077.005. PUBLIC PURPOSE; TAX EXEMPTION. All property owned by the district:

(1) shall be held for public purposes; and

(2) is exempt from taxation of every character by this state or a political subdivision of this state. (Acts 64th Leg., R.S., Ch. 211, Sec. 17 (part).)

Source Law

Sec. 17. … In addition, all property owned by the district shall be held for public purposes and shall be exempt from taxation of every character by the state or any municipality or political subdivision thereof.

Revisor's Note

Section 17, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, refers to a "municipality or political subdivision." Throughout this chapter, the revised law omits the references to "municipality" because "municipality" is included in the meaning of "political subdivision."

Revised Law

Sec. 1077.006. 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 64th Leg., R.S., Ch. 211, Sec. 18 (part).)

Source Law

Sec. 18. The support and maintenance of Gainesville Hospital District shall never become a charge against or obligation of the State of Texas … .

Revised Law

Sec. 1077.007. RESTRICTION ON STATE FINANCIAL ASSISTANCE. The legislature may not make a direct appropriation for the construction, maintenance, or improvement of a district facility. (Acts 64th Leg., R.S., Ch. 211, Sec. 18 (part).)

Source Law

Sec. 18. … nor shall any direct appropriation be made by the legislature for the construction, maintenance, or improvement of any of the facilities of such district.

Revisor's Note

(End of Subchapter)

Section 3, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides procedures for holding an election on the creation of the district and the imposition of an ad valorem tax. Because the creation of the district and the imposition of the tax were approved at the election, the revised law omits the relevant law as executed. The omitted law reads:

Sec. 3. The district shall not be created nor shall any tax therein be authorized unless and until such creation and such tax are approved by a majority of the qualified property taxpaying electors residing within boundaries of the proposed district voting at an election called for such purpose. Such election shall be called by a majority of the temporary or provisional directors of the district and shall be held not less than 30 nor more than 60 days from the time such election is ordered. The order calling the election shall specify the time and places of holding same, the form of ballot, and the presiding judge for each voting place. Notice of election shall be given by publishing a substantial copy of the election order in a newspaper of general circulation in the area of the proposed district once a week for two consecutive weeks, the first publication to appear at least 14 days prior to the date set for the election. The failure of any such election shall not operate to prohibit the calling and holding of subsequent elections for the same purpose. At said election there shall be submitted to the qualified property taxpaying electors of said proposed district the proposition of whether the Gainesville Hospital District shall be created with authority to levy annual taxes at a rate not to exceed 75 cents on the $100 valuation of all taxable property within such district for the purpose of meeting the requirements of the district's bonds (including those assumed) and for the care of indigents; and a majority of the qualified taxpaying electors of the district voting at said election in favor of the proposition shall be sufficient for its adoption. The ballots shall be prepared so as to permit voting "FOR" or "AGAINST" the following ballot proposition:

"THE CREATION OF GAINESVILLE HOSPITAL DISTRICT AND THE AUTHORIZATION TO LEVY ANNUAL TAXES AT A RATE NOT TO EXCEED 75 CENTS ON THE $100 VALUATION OF ALL TAXABLE PROPERTY WITHIN SUCH DISTRICT."

[Sections 1077.008-1077.050 reserved for expansion]

SUBCHAPTER B. DISTRICT ADMINISTRATION

Revised Law

Sec. 1077.051. BOARD ELECTION; TERM. (a) The district is governed by a board of nine directors.

(b) Directors serve staggered three-year terms.

(c) An election shall be held on the uniform election date in May of each year to elect the appropriate number of directors. (Acts 64th Leg., R.S., Ch. 211, Secs. 4(a), (b), (c) (part).)

Source Law

Sec. 4. (a) The district is governed by a board of nine directors.

(b) Directors serve staggered three-year terms.

(c) A regular election for directors shall be held on the uniform election date in May of each year to elect the appropriate number of directors… .

Revisor's Note

Section 3, Chapter 415, Acts of the 80th Legislature, Regular Session, 2007, provides for the staggering of terms for directors elected in 2008 and 2009 to accomplish the change of the members' terms from two to three years. Because this chapter will not take effect until 2011, the revised law omits those provisions as executed. The omitted law reads:

Sec. 3. (a) The election of directors scheduled before the effective date of this Act to be held in May, 2008, shall be held, and the three directors who receive the highest number of votes shall each be elected to serve three-year terms. The two remaining directors elected shall be elected to serve two-year terms. Successor directors shall serve three-year terms.

(b) Four directors shall be elected in 2009. The director who receives the highest number of votes shall be elected to serve a four-year term. The three remaining directors elected shall be elected to serve three-year terms. Successor directors shall serve three-year terms.

Revised Law

Sec. 1077.052. NOTICE OF ELECTION. Notice of an election of directors shall be published in a newspaper of general circulation in the area of the district in accordance with Section 4.003, Election Code. (Acts 64th Leg., R.S., Ch. 211, Sec. 4(c) (part).)

Source Law

(c) … Notice of such election shall be published in a newspaper of general circulation in the area of the district in accordance with Section 4.003, Election Code.

Revised Law

Sec. 1077.053. QUALIFICATIONS FOR OFFICE. To be qualified to hold office as a director, a person must be:

(1) a resident of the district; and

(2) a registered voter. (Acts 64th Leg., R.S., Ch. 211, Sec. 4(g).)

Source Law

(g) To be qualified to hold office as a director of the district, a person must be a resident of the district and a registered voter.

Revisor's Note

Section 4(i), Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, requires each director to take the constitutional oath of office. The revised law omits that provision because Section 1, Article XVI, Texas Constitution, requires all officers to take the oath (or affirmation) before assuming office. The omitted law reads:

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

Revised Law

Sec. 1077.054. MEETING ATTENDANCE REQUIREMENT. (a) A director who fails to attend at least four regular meetings in any 12-month period is considered to have resigned the director's position, effective immediately on the date of the fourth absence. Further action is not required by the director or the board to effectuate a vacancy under this subsection.

(b) A vacancy created by a resignation under this section shall be filled as provided by Section 1077.055. (Acts 64th Leg., R.S., Ch. 211, Sec. 4(e).)

Source Law

(e) A director who fails to attend at least four regular meetings in any 12-month period is considered to have resigned the director's position, effective immediately on the date of the fourth absence. Further action is not required by the director or the board to effectuate a vacancy under this subsection. A vacancy created by a resignation under this subsection shall be filled as provided by Subsection (d) of this section.

Revised Law

Sec. 1077.055. BOARD VACANCY. If a vacancy occurs in the office of director, the remaining directors by majority vote shall appoint a director for the unexpired term. (Acts 64th Leg., R.S., Ch. 211, Sec. 4(d).)

Source Law

(d) All vacancies in office shall be filled by a majority vote of the remaining directors, and such appointees shall hold office for the unexpired terms for which they were appointed.

Revised Law

Sec. 1077.056. OFFICERS. The board shall elect from among its members a president, vice president, secretary, and other officers as in the judgment of the board are necessary. (Acts 64th Leg., R.S., Ch. 211, Sec. 4(h).)

Source Law

(h) The board of directors shall elect from its number a president, vice-president, secretary, and such other officers as in the judgment of the board are necessary.

Revised Law

Sec. 1077.057. COMPENSATION; EXPENSES. A director is not entitled to compensation but is entitled to receive actual expenses incurred in attending to district business on approval of the expenses by the remainder of the board. (Acts 64th Leg., R.S., Ch. 211, Sec. 4(f).)

Source Law

(f) No director shall be entitled to compensation but shall be entitled to receive his actual expenses incurred in attending to the district's business, provided such expenses are approved by the remainder of the board.

Revised Law

Sec. 1077.058. DISTRICT ADMINISTRATOR; ASSISTANT ADMINISTRATOR. (a) The board shall appoint a qualified person as district administrator.

(b) The board may appoint an assistant administrator.

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

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

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

(2) contains other conditions the board may require.

(e) The board may pay for the bond with district money. (Acts 64th Leg., R.S., Ch. 211, Sec. 5(b) (part).)

Source Law

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

Revised Law

Sec. 1077.059. 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 64th Leg., R.S., Ch. 211, Sec. 5(b) (part).)

Source Law

(b) … The administrator shall supervise all the work and activities of the hospital district and shall have general direction of the affairs of the district, subject to such limitations as may be prescribed by the board.

Revised Law

Sec. 1077.060. APPOINTMENT AND DISMISSAL OF STAFF AND EMPLOYEES. (a) The board may appoint to or dismiss from the medical staff the physicians, dentists, and podiatrists the board determines necessary for the efficient operation of the district.

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

(c) The board may delegate to the district administrator the authority to hire district employees. (Acts 64th Leg., R.S., Ch. 211, Secs. 5(c), (d).)

Source Law

(c) The board of directors shall have the authority to appoint to or dismiss from the medical staff such physicians, dentists, and podiatrists as the board determines are necessary for the efficient operation of the hospital district.

(d) The district may employ technicians, nurses, fiscal agents, accountants, architects, additional attorneys, and other necessary employees. The board may delegate to the administrator the authority to employ persons for the district.

Revised Law

Sec. 1077.061. PERSONNEL CONTRACTS. (a) The board may contract with a nonprofit corporation for the corporation to provide administrative and other personnel for the operation of the hospital facilities.

(b) The term of the contract may not exceed 25 years from the date the contract is executed. (Acts 64th Leg., R.S., Ch. 211, Sec. 5(f).)

Source Law

(f) The board may also enter into a contract or contracts with nonprofit corporations whereby such corporations agree to provide administrative and other personnel for the operation of the hospital facilities, but in no event may such contract be for a period in excess of 25 years from the date the same is executed.

Revised Law

Sec. 1077.062. RETIREMENT BENEFITS. The board may enter into any contract or agreement with this state or the federal government that is required to establish or continue a retirement program for the benefit of the district's employees. (Acts 64th Leg., R.S., Ch. 211, Sec. 5(e) (part).)

Source Law

(e) … The board of directors is also authorized to enter into such contracts or agreements with the State of Texas or the federal government as may be required to establish or continue a retirement program for the benefit of the district's employees.

Revisor's Note

(End of Subchapter)

(1) Section 4(c), Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, 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:

(c) … 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 of directors of the district in accordance with Chapter 144, Election Code. …

(2) Section 4(j), Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, 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 any business" because "quorum" means the number of persons or votes necessary for a body to act. The omitted law reads:

(j) A majority of the board shall constitute a quorum for the transaction of business.

[Sections 1077.063-1077.100 reserved for expansion]

SUBCHAPTER C. POWERS AND DUTIES

Revised Law

Sec. 1077.101. DISTRICT RESPONSIBILITY. (a) The district has full responsibility for operating all hospital facilities for providing medical and hospital care of the indigent persons in the district.

(b) The district shall provide medical and hospital care for the district's needy inhabitants. (Acts 64th Leg., R.S., Ch. 211, Secs. 2 (part), 16 (part).)

Source Law

Sec. 2. The hospital district herein authorized to be created shall provide medical and hospital care for its needy inhabitants and … .

Sec. 16. … the said Gainesville Hospital District shall assume full responsibility for the operation of all hospital facilities for the furnishing of medical and hospital care of indigent persons within its boundaries.

Revisor's Note

Section 16, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides that the district "shall assume" full responsibility for the operation of hospital facilities for the indigent. The revised law substitutes "has" for the quoted language because the duty to assume responsibility is executed.

Revised Law

Sec. 1077.102. RESTRICTION ON POLITICAL SUBDIVISION TAXATION AND DEBT. A political subdivision in the district, other than the district, may not impose a tax or issue bonds or other obligations for hospital purposes for medical treatment of indigent persons in the district. (Acts 64th Leg., R.S., Ch. 211, Sec. 16 (part).)

Source Law

Sec. 16. After creation of Gainesville Hospital District, as herein provided, no other municipality or political subdivision therein shall thereafter issue bonds or other evidence of indebtedness or levy taxes for hospital purposes for medical treatment of indigent persons within the boundaries of said district, and … .

Revisor's Note

(1) Section 16, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides that "[a]fter creation of Gainesville Hospital District," certain political subdivisions may not issue bonds or levy taxes for certain purposes. 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 16, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides that a municipality or political subdivision in the district may not issue bonds or other "evidence of indebtedness." The revised law substitutes "obligations" for "evidence of indebtedness" because, in context, the terms are synonymous, and "obligations" is more commonly used.

Revised Law

Sec. 1077.103. MANAGEMENT, CONTROL, AND ADMINISTRATION. The board shall manage, control, and administer the hospital system and the district's money and resources. (Acts 64th Leg., R.S., Ch. 211, Sec. 5(a) (part).)

Source Law

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

Revised Law

Sec. 1077.104. RULES. The board may adopt rules governing the operation of the district and as required to administer this chapter. (Acts 64th Leg., R.S., Ch. 211, Secs. 5(a) (part), (g) (part).)

Source Law

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

(g) The board of directors of such district shall have the power … to make such rules and regulations as may be required to carry out the provisions of this Act. …

Revisor's Note

Sections 5(a) and (g), Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provide that the board may "promulgate rules and regulations" to govern the district and "make such rules and regulations as may be required" to carry out the act. The revised law substitutes "adopt" for "promulgate" and "make" because the terms are synonymous and the former is more commonly used. The revised law also omits the reference to "regulations" because under Section 311.005(5), Government Code (Code Construction Act), a rule is defined to include a regulation.

Revised Law

Sec. 1077.105. 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 64th Leg., R.S., Ch. 211, Sec. 5(g) (part).)

Source Law

(g) The board of directors of such district shall have the power to prescribe the method and manner of making purchases and expenditures by and for such hospital district and also shall be authorized to prescribe all accounting and control procedures and … .

Revised Law

Sec. 1077.106. DISTRICT PROPERTY, FACILITIES, EQUIPMENT, AND SERVICES. (a) The board has exclusive authority to determine the type, character, and use of facilities in the hospital system.

(b) The district may:

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

(2) equip buildings and improvements for hospital purposes. (Acts 64th Leg., R.S., Ch. 211, Secs. 2 (part), 5(g) (part).)

Source Law

Sec. 2. [The hospital district herein authorized] … is hereby authorized and empowered to purchase, construct, acquire, repair, or renovate buildings and improvements and equip same for hospital purposes. …

[Sec. 5]

(g) … The board is given exclusive authority to determine the type, character, and use of the facilities forming a part of the hospital system.

Revised Law

Sec. 1077.107. 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. (Acts 64th Leg., R.S., Ch. 211, Sec. 12.)

Source Law

Sec. 12. The district created hereunder shall have the right and power of eminent domain for the purpose of acquiring by condemnation any and all property of any kind and character in fee simple or any lesser interest therein, within the boundaries of the district necessary or convenient to the powers, rights, and privileges conferred by this Act, in the manner provided by the general law with respect to condemnation.

Revisor's Note

(1) Section 12, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, 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 12, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides that the district must exercise the power of eminent domain "in the manner provided by the general law with respect to condemnation." The revised law substitutes for the quoted language a reference to Chapter 21, Property Code, because that is the general law governing eminent domain.

Revised Law

Sec. 1077.108. 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 64th Leg., R.S., Ch. 211, Sec. 15.)

Source Law

Sec. 15. The board of directors of the hospital district is authorized on behalf of such district to accept donations, gifts, and endowments to be held in trust and administered by the board of directors for such purposes and under such directions, limitations, and provisions as may be prescribed in writing by the donor, not inconsistent with proper management and object of the hospital district.

Revisor's Note

Section 15, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, 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. 1077.109. CONTRACTS WITH GOVERNMENTAL ENTITIES FOR CARE AND TREATMENT. (a) The board may contract with a county or municipality located outside the district for the care 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 treatment of a sick or injured person for whom this state or the agency is responsible. (Acts 64th Leg., R.S., Ch. 211, Sec. 5(e) (part).)

Source Law

(e) Such board shall be authorized to contract with any county or incorporated municipality located outside the district for the care 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 of Texas and agencies of the federal government for treatment of sick, diseased, or injured persons for whom the State of Texas or the federal government is responsible. …

Revisor's Note

(1) Section 5(e), Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, 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 5(e), Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, 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. 1077.110. PAYMENT FOR TREATMENT; PROCEDURES. (a) When an indigent patient who resides in the district is admitted to a district facility or a person who does not reside in the district is admitted as an emergency patient to a district facility, the district administrator shall have an inquiry made into the circumstances of:

(1) the patient; and

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

(b) If the district administrator determines that the patient or those relatives cannot pay all or part of the costs of the care and treatment in the hospital, the amount of the costs that cannot be paid becomes a charge against the district as care for indigents.

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

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

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

(1) resolve the dispute or doubt; and

(2) issue any appropriate orders.

(f) A final order of the board may be appealed to the district court. The substantial evidence rule applies to the appeal. (Acts 64th Leg., R.S., Ch. 211, Sec. 14.)

Source Law

Sec. 14. Whenever an indigent patient residing within the district has been admitted to the facilities thereof, the administrator or manager shall cause inquiry to be made as to his circumstances and those of the relatives of such patient legally liable for his support. If he finds that such patient or said relatives are able to pay for his care and treatment, in whole or in part, an order shall be made directing such patient or said relatives to pay to the hospital district for the support of such patient a specified sum per week in proportion to their financial ability, but such sum shall not exceed the actual per capita cost of maintenance. The administrator or manager shall have power and authority to collect such sums from the estate of the patient or his relatives legally liable for his support in the manner provided by law for the collection of expenses in the last illness of a deceased person. If the administrator or manager finds that such patient or said relatives are not able to pay, either in whole or in part, for his care and treatment in such hospital, same shall become a charge upon the hospital district, to the amount of the inability to pay, as care for indigents. Should there be any dispute as to the ability to pay, or doubt in the mind of the administrator or manager, the board of directors shall hear and determine same, after calling witnesses, and shall make such order or orders as may be proper. Appeals from a final order of the board shall lie to the district court. The substantial evidence rule shall apply. The provisions of this section shall also apply to nonresidents of the district who are admitted as emergency patients.

Revisor's Note

Section 14, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, refers to the district "administrator or manager." Chapter 415, Acts of the 80th Legislature, Regular Session, 2007, amended Section 5, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975 (revised in Subchapter B of this chapter), to strike the references to a district manager. For that reason, and because in context "administrator" and "manager" are synonymous, the revised law omits references to a district manager throughout this chapter.

Revised Law

Sec. 1077.111. AUTHORITY TO SUE AND BE SUED. As a governmental entity, the district, through the board, may sue and be sued in its own name in any court of this state. (Acts 64th Leg., R.S., Ch. 211, Secs. 5(a) (part), 17 (part).)

Source Law

Sec. 5. (a) … The district through its board of directors shall have the power and authority to sue and be sued and … .

Sec. 17. The hospital district … as a governmental agency may sue and be sued in any and all courts of this state in the name of such district. …

[Sections 1077.112-1077.150 reserved for expansion]

SUBCHAPTER D. GENERAL FINANCIAL PROVISIONS

Revised Law

Sec. 1077.151. BUDGET. (a) The district administrator shall prepare an annual budget for approval by the board.

(b) The budget must be for the next fiscal year and must include:

(1) proposed expenditures and disbursements;

(2) estimated receipts and collections; and

(3) the amount of taxes required to be imposed for the year. (Acts 64th Leg., R.S., Ch. 211, Sec. 6 (part).)

Source Law

Sec. 6. … In addition the administrator or manager shall prepare an annual budget for approval by the board of directors of said district… .

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

Revisor's Note

Section 6, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, refers to the levy and collection of a tax. The revised law substitutes "imposed" for "levied and collected" because "imposed" is the term generally used in Title 1, Tax Code, and includes the levying and collection of an ad valorem tax.

Revised Law

Sec. 1077.152. PROPOSED BUDGET; NOTICE AND HEARING. (a) The board shall hold a public hearing on the proposed budget.

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

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

(2) be heard regarding any item included in the proposed budget. (Acts 64th Leg., R.S., Ch. 211, Sec. 6 (part).)

Source Law

Sec. 6. … The board of directors … shall hold a public hearing on the proposed budget after publication of a notice of hearing in a newspaper of general circulation in the county at least once not less than 10 days prior to the date set for the hearing. Any person who is a taxpayer of the district shall have the right to appear at the time and place designated in the notice and be heard with reference to any item shown in the proposed budget… .

Revisor's Note

Section 6, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, refers to "the county." Throughout this chapter, the revised law substitutes Cooke County for the quoted language because that is the county in which the district is located.

Revised Law

Sec. 1077.153. FISCAL YEAR. (a) The district operates according to a fiscal year established by the board.

(b) The fiscal year may not be changed more than once in a 36-month period. (Acts 64th Leg., R.S., Ch. 211, Sec. 6 (part).)

Source Law

Sec. 6. The district shall be operated on a fiscal year as established by the board, but in no event may the fiscal year be changed more than one time in any 36-month period… .

Revised Law

Sec. 1077.154. AUDIT. (a) The district shall have an audit made of the district's financial condition.

(b) The audit shall be open to inspection at all times at the district's principal office. (Acts 64th Leg., R.S., Ch. 211, Sec. 6 (part).)

Source Law

Sec. 6. … The district shall cause an audit to be made of the financial condition of said district, which shall at all times be open to inspection at the principal office of the district… .

Revised Law

Sec. 1077.155. FINANCIAL REPORT. As soon as practical 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 64th Leg., R.S., Ch. 211, Sec. 6 (part).)

Source Law

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

Revised Law

Sec. 1077.156. DEPOSITORY. (a) The board shall select one or more banks in the district to serve as a depository for district money.

(b) District money shall be immediately deposited on receipt with a depository bank to pay the principal of and interest on the district's outstanding bonds on or before the maturity date of the principal and interest.

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

(d) Membership on the district's board of an officer or director of a bank does not disqualify the bank from being designated as a depository bank. (Acts 64th Leg., R.S., Ch. 211, Sec. 13.)

Source Law

Sec. 13. The board of directors of the district shall name one or more banks within the district to serve as depository for the funds of the district. All such funds, as derived and collected, shall be immediately deposited with such depository bank or banks for the payment of principal of and interest on the outstanding bonds of the district in time that such money may be received by said bank or banks for payment on or prior to the date of maturity of such principal and interest to be paid. To the extent that funds in the depository bank or banks are not insured by the Federal Deposit Insurance Corporation, they shall be secured in the manner provided by law for security of county funds. Membership on the board of directors of an officer or director of a bank shall not disqualify such bank from being designated as depository.

Revisor's Note

Section 13, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, refers to money "derived and collected." The revised law substitutes "on receipt" for the quoted language because the terms are synonymous, and the former is more commonly used.

[Sections 1077.157-1077.200 reserved for expansion]

SUBCHAPTER E. BONDS

Revised Law

Sec. 1077.201. BONDS. The board may issue and sell bonds to:

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

(2) equip buildings and improvements for hospital purposes. (Acts 64th Leg., R.S., Ch. 211, Sec. 9 (part).)

Source Law

Sec. 9. The board of directors of the hospital district shall have the power and authority to issue and sell bonds for the purchase, construction, acquisition, repair, or renovation of buildings and improvements and equipping the same for hospital purposes; … .

Revisor's Note

Section 9, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, refers to issuing bonds for certain hospital authority purposes. The revised law omits that provision because the revised law authorizes the issuance of bonds generally for any hospital facility. The omitted law reads:

Sec. 9. … including but not limited to the purchasing and acquiring, and from time to time improving, repairing, renovating, and equipping all buildings, improvements, furnishings, and equipment of any hospital authority established prior to the election for the creation of the hospital district and pursuant to the provisions of Article 4437e, Vernon's Texas Civil Statutes, and located wholly within the boundaries of the hospital district… .

Revised Law

Sec. 1077.202. TAX TO PAY BONDS. (a) The board may issue bonds under Section 1077.201 payable from ad valorem taxes. If the bonds are payable from ad valorem taxes, the board shall impose an ad valorem tax to create an interest and sinking fund sufficient to pay the principal of and interest on the bonds as the bonds mature.

(b) The tax required by this section together with any other ad valorem tax the district imposes may not in any year exceed 75 cents on each $100 valuation of all taxable property in the district. (Acts 64th Leg., R.S., Ch. 211, Sec. 9 (part).)

Source Law

Sec. 9. [The board of directors of the hospital district shall have the power and authority to issue … bonds] … . Such bonds may be payable from (1) a tax levied to create an interest and sinking fund sufficient to pay the interest on and principal of the bonds, as the same become due and mature, provided such tax together with any other taxes levied by the district shall not exceed 75 cents on each $100 valuation of taxable property in any one year, or … .

Revisor's Note

Section 9, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, authorizes the district to impose 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. 1077.203. BOND ELECTION. (a) The district may issue bonds under Section 1077.201 that are payable from taxes only if the bonds are authorized by a majority of the district voters voting at an election held for that purpose.

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

(1) the date of the election;

(2) the location of the polling places;

(3) the presiding election officers;

(4) the purpose of the bond issuance;

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

(6) the maximum maturity of the bonds.

(d) Notice of a bond election shall be given by publishing a substantial copy of the order calling the election in a newspaper of general circulation in the district once each week for two consecutive weeks before the date of the election. The first publication must occur at least 14 days before the date of the election. (Acts 64th Leg., R.S., Ch. 211, Sec. 9 (part).)

Source Law

Sec. 9. … No bonds payable from taxes (except refunding bonds and bonds issued to purchase and acquire all buildings, improvements, furnishings, and equipment of a hospital authority, as provided in Section 8(b) of this Act) shall be issued by the hospital district until authorized by a majority vote of the resident qualified electors, who own taxable property within the district and who have duly rendered the same for taxation, voting at an election called and held for such purpose. Such election for the authorization to issue tax bonds may be called by the board of directors on its own motion, and the order calling the election shall specify the date of the election, the place or places where the election shall be held, the presiding officers thereof, the purpose for which the bonds are to be issued, the amount thereof, and the maximum maturity date of such bonds … . Notice of such bond election shall be given by publishing a substantial copy of the order calling the election in a newspaper of general circulation in the district once a week for two consecutive weeks, the date of the first publication to be at least 14 days prior to the date set for the election… .

Revisor's Note

(1) Section 9, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides that "[n]o bonds … (except refunding bonds …)" may be issued without an election. The revised law omits the exception for refunding bonds because Chapter 1207, Government Code, provides general authority for an issuer, including a hospital district, to issue refunding securities, and Section 1207.003, Government Code, authorizes an issuer to issue refunding bonds without an election.

(2) Section 9, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides that "[n]o bonds … except … bonds issued to purchase and acquire" buildings and equipment of a hospital authority as "provided in Section 8(b) of this Act" may be issued without an election. As explained in the revisor's note at the end of this chapter, Section 8, Chapter 211, is executed. The revised law therefore omits the reference.

(3) Section 9, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, refers to a majority vote of the "resident qualified electors, who own taxable property within the district and who have duly rendered the same for taxation." The revised law omits the reference to "resident qualified electors" 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. In addition, the revised law omits the reference to voters "who own taxable property within the district and who have duly rendered the same for taxation" because in Hill v. Stone, 421 U.S. 289, 95 S. Ct. 1637 (1975), the United States Supreme Court determined that property ownership as a qualification for voting is an unconstitutional denial of equal protection.

(4) Section 9, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides that the district may not issue bonds payable from taxes until authorized by 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.

Revised Law

Sec. 1077.204. REVENUE BONDS. (a) The board may issue bonds under Section 1077.201 payable from the district's revenue. The board may issue the revenue bonds without an election.

(b) The bonds must be payable from all or part of the revenue derived from the operation of the district's hospitals.

(d) The bonds must be issued in the manner and in accordance with the procedures and requirements prescribed by Sections 264.042, 264.043, 264.046, 264.047, 264.048, and 264.049, Health and Safety Code, for issuance of revenue bonds by a county hospital authority. (Acts 64th Leg., R.S., Ch. 211, Sec. 9 (part).)

Source Law

Sec. 9. [The board of directors of the hospital district shall have the power and authority to issue … bonds] … . Such bonds may be payable from … (2) all or any part of the revenues of the district to be derived from the operation of its hospital or hospitals, and such revenue bonds may be additionally secured by a mortgage or deed-of-trust lien on any part or all of its properties… .

Revenue bonds of the district may be issued without an election in the manner and in accordance with the procedures and requirements specified for the issuance of revenue bonds by county hospital authorities in Sections 8, 10, 11, 12, and 13 of Article 4494r, Vernon's Texas Civil Statutes… .

Revisor's Note

Section 9, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, refers to Sections 8, 10, 11, 12, and 13 of Article 4494r, Vernon's Texas Civil Statutes. Those provisions were codified in 1989 as Sections 264.042, 264.043, 264.046, 264.047, 264.048, and 264.049, Health and Safety Code. The revised law is drafted accordingly.

Revised Law

Sec. 1077.205. MATURITY OF TAX BONDS. District bonds payable from taxes must mature not later than 40 years after the date of issuance. (Acts 64th Leg., R.S., Ch. 211, Sec. 9 (part).)

Source Law

Sec. 9. [… bonds payable from taxes … the order calling the election shall specify] … the maximum maturity date of such bonds (not to exceed 40 years from the date of issuance)… .

Revised Law

Sec. 1077.206. EXECUTION OF BONDS. (a) The board president shall execute the district bonds in the district's name.

(b) The board secretary shall countersign the bonds. (Acts 64th Leg., R.S., Ch. 211, Sec. 9 (part).)

Source Law

Sec. 9. … Such bonds shall be executed in the name of the hospital district and on its behalf by the president of the board of directors and countersigned by the secretary of the board of directors and … .

Revisor's Note

Section 9, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, 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 9 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:

Sec. 9. … [Such bonds] … shall be subject to the same requirements in the matter of approval thereof by the Attorney General of the State of Texas and the registration thereof by the Comptroller of Public Accounts of the State of Texas as are by law provided for such approval and registration of bonds of counties of this state. Upon the approval of such bonds by the Attorney General of Texas and registration by the comptroller, the same shall be incontestable for any cause.

Revisor's Note

(End of Subchapter)

(1) Section 9, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, 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:

Sec. 9. … The bonds of the district may be made optional for redemption prior to maturity date at the discretion of the board of directors, … .

(2) Section 9, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides that district bonds may be in any denomination fixed in the order issuing the bonds. The revised law omits this provision because Section 1201.021, Government Code, provides that the governing body of an issuer, including a hospital district, may issue bonds in any denomination. Section 9 also provides that bonds may be issued and sold at any price determined by the district's board and may bear interest at any rate determined by the district's board. The revised law omits this provision as superseded by the enactment of the maximum interest rate provision found in Section 1204.006, Government Code. That section reflects the 1981 amendment of Chapter 3, Acts of the 61st Legislature, Regular Session, 1969 (Article 717k-2, Vernon's Texas Civil Statutes, now Chapter 1204, Government Code), by Section 1, Chapter 61, Acts of the 67th Legislature, Regular Session, 1981. Section 1204.006(b), Government Code, provides that an issuer, including a hospital district, may sell public securities at any price and bearing interest at any rate or rates that does not exceed the maximum rate prescribed by Section 1204.006(a). The omitted law reads:

Sec. 9. … [The bonds of the district] … may be in any denomination fixed and determined in the order authorizing the issuance of such securities, and may be issued and sold at any price or prices and bear interest at any rate or rates as shall be determined within the discretion of the board of directors of the district… .

(3) Section 10, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, authorizes the district to issue refunding bonds for bonds issued or assumed under that act. The revised law omits these provisions for the reason stated in Revisor's Note (1) to Section 1077.203. Section 10 also provides that refunding bonds issued under Section 10 must bear interest at the same or lower rate than the bonds being refunded unless the refunding will result in a lower total amount of interest paid. The revised law omits this provision because it has been superseded by the enactment of the maximum interest rate provision found in Section 1204.006, Government Code. That section reflects the 1981 amendment of Chapter 3, Acts of the 61st Legislature, Regular Session, 1969 (Article 717k-2, Vernon's Texas Civil Statutes, now Chapter 1204, Government Code), by Section 1, Chapter 61, Acts of the 67th Legislature, Regular Session, 1981, and permits a public agency, including a hospital district, to issue public securities at any net effective interest rate of 15 percent or less. Section 1204.006, Government Code, applies to district bonds by application of Section 1204.001, Government Code. The omitted law reads:

Sec. 10. The board of directors may, without an election, issue bonds of the district (payable from taxes or revenues) to refund and pay off any validly issued and outstanding bonds heretofore or hereafter issued by the district and any bonds or other obligations assumed by it under the provisions of Section 8 of this Act; provided, any such refunding bonds shall bear interest at the same rate or at a lesser rate than the bonds being refunded unless it be shown mathematically that a savings will result in the total amount of interest to be paid. If the district assumes any revenue bonds of a hospital authority, it may refund them with the same authority and in the same manner as if the district had originally issued such bonds and pursuant to any general law of the State of Texas authorizing refunding bonds and applicable to hospital districts.

(4) Section 11, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, 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 11 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 11 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. 11. All bonds of the district shall be and are hereby declared to be legal and authorized investments of banks, savings banks, trust companies, building loan associations, savings and loan associations, insurance companies, fiduciaries, trustees, and sinking funds of cities, towns, villages, counties, school districts, or other political subdivisions of the State of Texas, and for all public funds of the State of Texas or its agencies, including the State Permanent School Fund… .

(5) Section 11, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, effectively provides that district bonds may secure deposits of public funds of this state or political subdivisions of this state. The revised law omits the provisions as impliedly repealed by Section 404.0221, Government Code (enacted in 1995), which lists eligible collateral for deposits of state funds by the comptroller, and by Chapter 2257, Government Code (enacted in 1989 as Article 2529d, Vernon's Texas Civil Statutes), which governs eligible collateral for deposits of funds of other public agencies, including political subdivisions. The omitted law reads:

Sec. 11. … Such bonds shall be eligible to secure deposit of public funds of the State of Texas and public funds of cities, towns, villages, counties, school districts, or other political subdivisions or corporations of the State of Texas; and such bonds shall be lawful and sufficient security for said deposits to the extent of their value when accompanied by all unmatured coupons appurtenant thereto.

[Sections 1077.207-1077.250 reserved for expansion]

SUBCHAPTER F. TAXES

Revised Law

Sec. 1077.251. IMPOSITION OF AD VALOREM TAX. (a) On final approval of the annual budget, the board shall impose a tax on all property in the district subject to district taxation.

(b) The board shall impose the tax to:

(1) pay the interest on and create a sinking fund for bonds issued or assumed by the district for hospital purposes; and

(2) care for indigents. (Acts 64th Leg., R.S., Ch. 211, Secs. 6 (part), 7 (part).)

Source Law

Sec. 6. … upon final approval of the budget, the board of directors shall levy such tax as may be required and … .

Sec. 7. The board of directors of the hospital district shall have the power and authority and it shall be their duty to levy on all property subject to hospital-district taxation for the benefit of the district a tax … for the purpose of (1) paying the interest on and creating a sinking fund for bonds (including those assumed) of the hospital district for hospital purposes as herein provided, … and (2) the care of indigents… .

Revisor's Note

Section 6, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, requires the board to certify the tax rate to the tax assessor-collector. The revised law omits that provision because Section 26.05(a), Tax Code, requires the governing body of a taxing unit to adopt a tax rate for the current tax year and to notify the tax assessor of that rate. The omitted law reads:

Sec. 6. … [the board of directors shall] … certify the tax rate for such year to the tax assessor and collector of the district, and … .

Revised Law

Sec. 1077.252. TAX RATE. (a) The board may impose the tax at a rate not to exceed 75 cents on each $100 valuation of all taxable property in the district.

(b) Not more than 65 cents of the rate authorized by Subsection (a) may be imposed in any year to pay the interest on and create a sinking fund for bonds issued or assumed by the district for hospital purposes. (Acts 64th Leg., R.S., Ch. 211, Sec. 7 (part).)

Source Law

Sec. 7. [The board of directors … shall … levy … a tax] at a rate not to exceed 75 cents on the $100 valuation of all taxable property within the hospital district [for the purpose of (1) paying the interest on and creating a sinking fund for bonds (including those assumed) of the hospital district for hospital purposes as herein provided,] but no more than 65 cents may be levied for such purpose in any one year, … .

Revised Law

Sec. 1077.253. TAX ASSESSOR-COLLECTOR. (a) Except as provided by Subsection (b), the tax assessor-collector of Cooke County shall assess and collect taxes imposed by the district.

(b) The board may appoint a district tax assessor-collector under Section 285.041, Health and Safety Code. (Acts 64th Leg., R.S., Ch. 211, Secs. 6 (part), 7 (part).)

Source Law

Sec. 6. … it shall be the duty of said tax assessor and collector of the district to assess and collect such tax.

Sec. 7. … The Tax Assessor and/or Collector of Cooke County shall be charged and required to accomplish the assessment and collection of all taxes levied by and on behalf of the district… .

In the alternative, the board of directors of the district, in its sole discretion, may … appoint its own tax assessor and collector, pursuant to and in accordance with the provisions of Chapter 595, Acts of the 62nd Legislature, 1971 (compiled as Article 4494-4, Vernon's Texas Civil Statutes).

Revisor's Note

(1) Section 7, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, refers to the assessment of district taxes on county tax values and also authorizes the board of directors to prepare a separate and distinct tax roll for the district. 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. Title 1, Tax Code, provides the exclusive procedures for the imposition and collection of property taxes by a taxing unit, including a hospital district. The omitted law reads:

Sec. 7. … Unless otherwise determined by the board of directors, all taxable property within the hospital district subject to hospital-district taxation shall be assessed on county tax values in the same manner as provided by law with relation to county taxes… .

[In the alternative, the board of directors of the district, in its sole discretion, may] cause to be prepared a separate and distinct tax roll for the district and … .

(2) Section 7, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides that the county tax assessor-collector may charge a fee for the assessment and collection of district taxes. 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:

Sec. 7. … The county assessor and collector of taxes shall charge and deduct from payments to the hospital district the dues for assessing and collecting the taxes at a rate of not to exceed one percent of the taxes collected as may be agreed upon by the district and the tax assessor, but in no event shall the amount of such compensation exceed a total of $5,000 in any one fiscal year of the district. Such fees shall be deposited in the officers' salary fund of the county and reported as fees of office of the county tax assessor and collector… .

(3) Section 7, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides that interest and penalties on district taxes and discounts are the same as for county taxes. 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). Chapter 33, Tax Code, provides for the assessment of penalties and interest on delinquent taxes, and Section 31.05, Tax Code, provides for discounts on the early payment of taxes. The omitted law reads:

Sec. 7. … Interest and penalties on taxes paid to the hospital district shall be the same as in the case of county taxes. Discounts shall be the same as allowed by the county… .

(4) Section 7, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides that tax revenue shall be deposited in the district's depository. The revised law omits the provision because Section 31.10, Tax Code, requires the tax assessor-collector of a taxing unit to deposit taxes collected in the unit's depository. The omitted law reads:

Sec. 7. … The residue of tax collections, after deduction of discounts and fees for assessing and collecting, shall be deposited in the district's depository… .

(5) Section 7, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides that the bond of the county tax assessor-collector is security for the performance of district duties unless the board determines that an additional bond is necessary. The revised law omits that provision because it duplicates Section 6.29(b), Tax Code, which authorizes a taxing unit for which the county tax assessor-collector collects a tax to require that collector to post an additional bond. The omitted law reads:

Sec. 7. … The bond of the county tax assessor-collector shall stand as security for the proper performance of his duties as assessor-collector of the district or, if in the judgment of the district board of directors it is necessary, additional bond payable to the district may be required… .

(6) Section 7, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, states that the tax assessor-collector may act in accordance with state law relating to the assessment, collection, and enforcement of state and county taxes. The revised law omits that provision as unnecessary. The state law relating to the assessment, collection, and enforcement of all ad valorem taxes is Title 1, Tax Code. Section 1.02, Tax Code, requires all taxing units of government to administer the assessment, collection, and enforcement of taxes in conformity with that title. The omitted law reads:

Sec. 7. … In all matters pertaining to the assessment, collection, and enforcement of taxes for the district, the county tax assessor-collector shall be authorized to act in all respects according to the laws of the State of Texas relating to state and county taxes… .

(7) Section 7, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, authorizes the board to appoint a district tax assessor-collector "pursuant to and in accordance with the provisions of Chapter 595, Acts of the 62nd Legislature, 1971 (compiled as Article 4494-4, Vernon's Texas Civil Statutes)." Chapter 595, Acts of the 62nd Legislature, Regular Session, 1971, was compiled as Article 4494r-4, Vernon's Texas Civil Statutes, and was codified in 1989 as Section 285.041, Health and Safety Code. The revised law is drafted accordingly.

Revisor's Note

(End of Subchapter)

Section 7, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides that the district may impose taxes for the entire year in which the district is created. The revised law omits that provision as executed. The omitted law reads:

Sec. 7. … The board of directors shall have the authority to levy the aforesaid tax for the entire year in which said district is established as the result of the election herein provided… .

Revisor's Note

(End of Chapter)

(1) Article 1, Chapter 428, Acts of the 77th Legislature, Regular Session, 2001, amends Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, by adding Sections 1A and 18A, which provide authority to call an election on the dissolution of the Gainesville Hospital District contingent on the creation of the Cooke County Hospital District. Section 3.02(b), Chapter 428, Acts of the 77th Legislature, Regular Session, 2001, provides that the "election in the Gainesville Hospital District … must be held before the fifth anniversary of the effective date of this Act." The effective date of Chapter 428 was May 28, 2001. Because the election on the question of creating the Cooke County Hospital District was not held before May 28, 2006 (the fifth anniversary of the effective date of Chapter 428), the authority to call an election on the dissolution of the Gainesville Hospital District has expired. Therefore, the revised law omits Sections 1A and 18A. The omitted law reads:

Sec. 1A. On the dissolution of the Gainesville Hospital District and the approval of the creation of the Cooke County Hospital District, a reference in this Act or in any other law to the Gainesville Hospital District means the Cooke County Hospital District.

Sec. 18A. (a) Notwithstanding the provisions of any other section of this Act, the Gainesville Hospital District may be dissolved as provided by this section.

(b) The board of directors may order an election on the question of the dissolution of the Gainesville Hospital District, creation of the Cooke County Hospital District, transfer of the Gainesville Hospital District's assets and obligations to the Cooke County Hospital District, and assumption by the Cooke County Hospital District of the Gainesville Hospital District's outstanding debts.

(1) the board has reasonable grounds to conclude that the board of the Muenster Hospital District will order an election under Section 20c, Chapter 477, Acts of the 59th Legislature, Regular Session, 1965; or

(2) the board receives a petition requesting an election on the question of the dissolution of the Gainesville Hospital District, creation of the Cooke County Hospital District, and transfer of assets that is signed by at least 15 percent of the registered voters in the Gainesville Hospital District.

(d) If the board of directors orders an election under this section, it shall promptly notify the board of directors of the Muenster Hospital District of the election order.

(e) The election shall be held not less than 45 or more than 60 days after the date on which an election is ordered and shall be held on the same date that the separate election in the Muenster Hospital District is held. The board of directors shall cooperate with the board of directors of the Muenster Hospital District in setting the date of the elections. Section 41.001(a), Election Code, does not apply to an election ordered under this section.

(f) The ballot for the election shall be printed to permit voting for or against the proposition: "The dissolution of the Gainesville Hospital District and creation of the Cooke County Hospital District, providing for the levy of a tax not to exceed 75 cents on each $100 valuation on all taxable property in the Cooke County Hospital District, and providing for the transfer to and assumption by the Cooke County Hospital District of all outstanding bonds and indebtedness issued or refunded for hospital purposes by the Gainesville Hospital District and the transfer of the existing Gainesville Hospital District's assets to the Cooke County Hospital District."

(g) Except as provided by Subsections (e) and (f) of this section, the election shall be held in accordance with the applicable provisions of the Election Code.

(h) The Gainesville Hospital District is dissolved if:

(1) a majority of the voters in the Gainesville Hospital District voting in the election held under this section favor the proposition; and

(2) a majority of the voters in the Muenster Hospital District voting in an election held on the same date under Section 20c, Chapter 477, Acts of the 59th Legislature, Regular Session, 1965, favor the dissolution of the Muenster Hospital District, the creation of the Cooke County Hospital District, the transfer of the assets of the Muenster Hospital District to the Cooke County Hospital District, and the assumption of the assets and obligations of the Muenster Hospital District by the Cooke County Hospital District.

(i) The Gainesville Hospital District is not dissolved and the board of directors shall continue to administer the Gainesville Hospital District if a majority of the voters in either the Gainesville Hospital District or the Muenster Hospital District do not favor the proposition on which they voted.

(j) If the Gainesville Hospital District is dissolved under this section, the board of directors shall orderly transfer the assets and obligations of the Gainesville Hospital District to the Cooke County Hospital District not later than the 180th day after the date of the election.

(k) The board of directors may not hold an election on the question of dissolution under this section and the creation of the Cooke County Hospital District before the first anniversary of the most recent election held under this section concerning the dissolution and the creation of the Cooke County Hospital District.

(2) Section 2, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, states that Cooke County or a municipality in the district does not have outstanding debt incurred for hospital purposes and that the Gainesville Hospital Authority is the only political subdivision owning, operating, and maintaining hospital facilities in the district's boundaries at the time of the district's creation. The revised law omits those provisions as executed. The omitted law reads:

Sec. 2. … It is hereby found and determined that neither Cooke County, Texas, nor any city or town within the boundaries of the hospital district herein authorized to be created has any outstanding indebtedness incurred for hospital purposes and that the Gainesville Hospital Authority (heretofore created and established under the provisions of Chapter 472, Acts of the 55th Legislature, Regular Session, 1957, as amended (Article 4437e, Vernon's Texas Civil Statutes)), is the only type of political subdivision of the State of Texas currently owning, operating, and maintaining hospital facilities within the boundaries of the proposed Gainesville Hospital District.

(3) Section 8, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides for the sale or transfer of certain land, buildings, improvements, equipment, and funds to the district after the district is created and provides for the assumption of debt by the district on creation. Because the transfer has occurred, the revised law omits the provision as executed. The omitted law reads:

Sec. 8. (a) In the event the hospital district is established and created, all right, title, and interest in and to any buildings, improvements, furnishings, and equipment owned and operated by a hospital authority established pursuant to Article 4437e, Vernon's Texas Civil Statutes, and located wholly within the boundaries of such hospital authority, including the unspent portions of any funds therefor set up or appropriated by budget or otherwise for the support and maintenance of hospital facilities and for the security and payment of outstanding debt, can be transferred to and become the funds of the district. In addition all obligations under contract by such hospital authority for hospital purposes, including any outstanding bonded indebtedness of the hospital authority, can be assumed and discharged by the hospital district without prejudice to the rights of third parties; and such hospital authority by virtue of such assumption shall be by the hospital district relieved of any further liability for the payment thereof or for providing interest and sinking-fund requirements thereon; provided that nothing herein contained shall limit or affect any of the rights of any of the holders of such bonds of the hospital authority in the event of default in the payment of the principal of or interest on any of such bonds in accordance with their respective terms. As soon as the hospital district is created and authorized at the election hereinabove provided, the governing body of such hospital authority can complete the transfer of properties herein authorized by executing and delivering to the hospital district, to wit, to its said board of directors, an instrument in writing conveying to said hospital district the hospital property located within the district's boundaries, including lands, buildings, furnishings, and equipment; and can transfer to said hospital district the funds hereinabove provided to become vested in the hospital district, upon being furnished the certificate of the president of the board of directors of the district to the fact that a depository for the district's funds has been selected and has qualified, which funds shall, in the hands of the hospital district and of its board of directors, be used for all or any of the same purposes as, and for no other purpose than, the purposes for which said hospital authority transferring such funds could lawfully have used the same had they remained the property and funds of such hospital authority.

(b) In the alternative to Subsection (a) of this section, the hospital district is hereby authorized and empowered to purchase from any such hospital authority, as described in Subsection (a), and each such hospital authority is hereby authorized to sell to said hospital district any and all of its hospital facilities, including all lands, buildings, equipment, and properties, at a price equal to the cost of paying and retiring all of the hospital authority's outstanding revenue bonds by utilizing one or more of the following methods, to wit: (1) by selling district bonds for cash in an amount sufficient to pay the authority's bonds and any premiums required to the bondholders to prepay the same prior to maturity or option date, and the payment thereof by the authority; or (2) by obtaining the consent of the holders of the authority's outstanding bonds to a purchase of the authority's hospital facilities and continuing the pledge of the revenues securing the authority's revenue bonds; or (3) by exchanging district bonds for such outstanding revenue bonds or refunding them with district bonds; or (4) by selling district bonds for cash in an amount necessary, without account for investment, to pay and retire such revenue bonds (both principal and interest) as they become due or mature, but not longer than the earliest option date, and making firm banking arrangements for such outstanding revenue bonds of the authority by depositing the proceeds from the sale of the district's bonds into an interest and sinking fund from which such revenue bonds are payable; or (5) any combination of the foregoing.

(4) Section 19, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, provides that the act is severable. The revised law omits this provision because it duplicates Section 311.032, Government Code (Code Construction Act), which provides that a provision of a statute is severable from each other provision of the statute that can be given effect. The omitted law reads:

Sec. 19. If any of the provisions of this Act or the application thereof to any person or circumstances is held invalid, such invalidity shall not affect other provisions or applications of the Act which can be given effect without the invalid provision or application, and to this end the provisions of this Act are declared to be severable.

(5) Section 20, Chapter 211, Acts of the 64th Legislature, Regular Session, 1975, 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. 20. Proof of publication of the notice required in the enactment hereof under the provisions of Section 9, Article IX, Constitution of the State of Texas, has been made in the manner and form provided by law pertaining to the enactment of local and special laws, and such notice is hereby found and declared proper and sufficient to satisfy such requirement.


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