HBA-TBM C.S.S.B. 1158 77(R) BILL ANALYSIS Office of House Bill AnalysisC.S.S.B. 1158 By: Fraser County Affairs 4/29/2001 Committee Report (Substituted) BACKGROUND AND PURPOSE The Act creating the Mitchell County Hospital District (district) was passed by the 60th Legislature in 1967, and has not been amended since 1973. The district's enabling legislation requires updating to conform with current laws. C.S.S.B. 1158 updates the enabling legislation of the Mitchell County Hospital District. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS C.S.S.B. 1158 amends law to modify provisions regarding qualifications, composition, power, and duties of the board of directors (board) of the Mitchell County Hospital District (district) (SECTION 1). The bill conditions the requirement that the administrator execute a bond to the board upon the board's authorization and authorizes the board to pay for the bond with district funds. The bill authorizes the board to provide retirement benefits for the employees of the district, spend district funds to recruit personnel, institute a suit regarding tax payments, provide educational programs for employees and medical staff, and sponsor and create a nonprofit corporation under the Texas Non-Profit Corporation Act. The bill sets forth provisions regarding the use of funds by the corporation (SECTION 2). The bill sets forth provisions regarding the modification of the fiscal year and an annual audit of the financial condition of the district (SECTION 3). The board removes the provisions relating to the issuance of bonds by the board. The bill authorizes the board to issue and sell bonds authorized by an election. The bill sets forth provisions regarding taxing for bonds, a bond election, the purpose of bonds issued by the board, security for the bonds, the issuance and refunding of such bonds, and interest paid on the bonds (SECTION 4). The bill removes provisions relating to property transfer and personnel contracts. The bill authorizes the board to purchase, lease, transfer, or sell property, facilities, and equipment. The bill authorizes the board to enter into a contract that does not exceed 25 years to provide personnel for the operation of the hospital facilities (SECTION 5). The bill authorizes the board to enter into a contract for construction that requires an expenditure of more than $15,000 only after competitive bidding (SECTION 6). The bill removes the restriction that a bank named by the board as a depository be within the boundaries of the district (SECTION 7). The bill modifies provisions relating to eminent domain to conform with updated law (SECTION 8). The bill authorizes the board to annually impose property taxes in an amount not to exceed 75 cents on each $100 valuation of all taxable property in the district. The bill sets forth provisions regarding the imposition of taxes by the district (SECTION 9). The bill authorizes the board to borrow money in emergency situations and otherwise at a rate not to exceed the maximum annual percentage rate allowed by law for district obligations at the time a loan is made. The bill sets forth provisions regarding collateral for the loan, the length until maturity, expenses covered by the loan, and repayment of the loan. The bill authorizes the district to be dissolved only if the dissolution is approved by a majority of the qualified voters of the district voting in an election called and held for that purpose. The bill sets forth provisions regarding the board calling such an election, providing notification of the election to the voting public, majority approval, dissolution of the district, transfer of district assets upon dissolution, imposition of tax to pay for any remaining debt, and providing notification of the dissolution to the Mitchell County Commissioners Court (SECTION 11). EFFECTIVE DATE On passage, or if the Act does not receive the necessary vote, the Act takes effect September 1, 2001. COMPARISON OF ORIGINAL TO SUBSTITUTE C.S.S.B. 1158 differs from the original by requiring the board of directors (board) of the Mitchell County Hospital District (district) to sell the assets and liabilities of the district to another person or entity if the majority of voters favor dissolution of the district. The substitute provides that if the district does not transfer its assets to a county or other governmental entity or sell those assets and liabilities to another person, the board is required to administer the property, assets, and debts of the district until all funds have been disposed of and all district debts have been paid or settled. After the district has paid all its debts and disposed of all its assets, the board is required to file a written report of the board's actions with the commissioners court of Mitchell County. The substitute provides that a grant from federal funds is an obligation to be repaid in satisfaction (SECTION 11).