HBA-MSH C.S.S.B. 739 77(R)    BILL ANALYSIS


Office of House Bill AnalysisC.S.S.B. 739
By: Wentworth
County Affairs
4/25/2001
Committee Report (Substituted)



BACKGROUND AND PURPOSE 

Currently, most public county hospitals operate as a part of a hospital
district. The public hospitals of Guadalupe County and Medina County are
run by a board of managers jointly funded by a municipality or the
appropriate county and are unable to issue bonds like a hospital district.
Guadalupe County is considering an expansion project to manage population
growth in the area, but will be unable to finance the project through the
issuance of bonds under the current system. C.S.S.B. 739 authorizes a board
of managers to issue revenue bonds in the name of a hospital.  

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. 739 amends the Health and Safety Code to authorize a board of
managers (board) to issue and sell revenue bonds in the name of a hospital
to finance: 

 _the acquisition of real property, equipment, or supplies; 

 _the acquisition, construction, improvement, repair, or rehabilitation of
hospital facilities; and 

 _the installation of equipment. 

The bill provides that bonds issued must be approved by a resolution
adopted by the board, the county commissioners court, and the governing
body of the municipality that appointed the board. The bill authorizes the
board to determine the title of the bonds and provide for the issuance of
additional parity bonds or subordinate lien bonds. The board is also
authorized to issue refunding bonds. The bill sets forth provisions
relating to the sale, repayment, security, and maturity of bonds, as well
as the use of earnings or assets for private purposes. C.S.S.B. 739
authorizes the board to acquire, hold, or dispose of property and title to
property to be held by the county or municipality or in the name of the
hospital. The bill requires the board to transfer title to property held by
the board to the county and municipality on the dissolution of the board as
agreed to by the county and municipality. The bill applies only to a
hospital located in a county with a population of 75,000 or more.  

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. 739 adds to the original bill by authorizing a hospital to issue
and sell revenue bonds to finance the acquisition, improvement, repair, or
rehabilitation of hospital facilities. The substitute adds the  requirement
that bonds issued be approved by resolutions adopted by the board, the
county commissioners court, and the governing body of the municipality. The
substitute also adds the authorization for the board to determine the title
of the bonds, to prescribe procedures for the operation and maintenance of
the hospital in the proceedings authorizing issuance of the bonds, and
provide for the issuance of additional parity bonds or subordinate lien
bonds. The substitute authorizes title to property held in the name of the
hospital in addition to the county or municipality. The substitute applies
only to a county with a population of 75,000 or more whereas the original
applied to all counties.