Health and Safety Code
CHAPTER 286. HOSPITAL DISTRICTS CREATED BY VOTER APPROVAL
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 286.001. Definitions.
In this chapter:
(1) "Board" means the board of directors of the district.
(2) "District" means a hospital district created under this
chapter.
(3) "Director" means a member of the board.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.002. District Authorization.
A hospital district may be created and established and, if
created, must be maintained, operated, and financed in the manner
provided by Article IX, Section 9, of the Texas Constitution and
by this chapter.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
SUBCHAPTER B. CREATION OF DISTRICT
Sec. 286.021. Petition for Creation of District.
(a) Before a district located wholly in one county may be
created, the county judge of that county must receive a petition
signed by at least 100 registered voters of the territory of the
proposed district.
(b) Before a district that contains territory located in more
than one county may be created, the county judge of each county
in which the proposed district will be located must receive a
petition signed by at least 100 registered voters of the
territory of the county in which the judge presides and of the
proposed district.
(c) If there are fewer than 100 registered voters in any area for
which a separate petition must be filed, the petition must be
signed by a majority of the registered voters in the area.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.022. Contents of Petition.
(a) The petition prescribed by Section 286.021 must show:
(1) that the district is to be created and is to operate
under Article IX, Section 9, of the Texas Constitution;
(2) the name of the proposed district;
(3) the district's boundaries as designated by metes and
bounds or other sufficient legal description;
(4) that none of the territory in the district is included
in another hospital district;
(5) the names of the temporary directors the commissioners
court must appoint under Section 286.030 or a request that the
commissioners court appoint temporary directors;
(6) the maximum tax rate to be voted on at the creation
election, which may not exceed 75 cents on the $100 valuation
of all taxable property in the district;
(7) the method by which the permanent directors will be
elected, as provided by Subsection (c); and
(8) the mailing address of each petitioner.
(b) The petition must provide for the appointment of the same
number of temporary directors as there will be permanent
directors.
(c) The petition may provide:
(1) the number of directors for the district, which number
must be an odd number; and
(2) the method by which directors are to be elected, whether
at large, by place, or both, so that a specific number of
directors are elected from each commissioner precinct and a
specific number are elected at large.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.023. Filing of Petition; Hearing; Ordering Election.
(a) If the petition is in proper form, the county judge shall
receive the petition and shall file the petition with the county
clerk.
(b) At the next regular or special session of the commissioners
court held after the petition is filed with the county clerk, the
commissioners court shall set a place, date, and time for the
hearing to consider the petition.
(c) The county clerk shall issue a notice of the hearing in
accordance with Chapter 551, Government Code.
(d) At the time and place set for the hearing, the
commissioners court shall consider the petition. The
commissioners court shall grant the petition if the court finds
that the petition is in proper form and contains the information
required by Section 286.022.
(e) If a petition is granted, the commissioners court shall
order an election to confirm the district's creation and to
authorize the levy of a tax not to exceed the amount prescribed
by the petition on each $100 of the taxable value of all taxable
property in the district.
(f) If the petition indicates that the proposed district will
contain territory in more than one county, the commissioners
court may not order an election until the commissioners court of
each county in which the district will be located has granted the
petition.
(g) The election shall be held after the 45th day and on or
before the 60th day after the date the election is ordered.
(h) Section 41.001(a), Election Code, does not apply to an
election ordered under this section.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Amended by Acts 1995, 74th Leg., ch. 76, Sec. 5.95(82), eff.
Sept. 1, 1995.
Sec. 286.0235. Bond Proposition at Election.
(a) The petition prescribed by Section 286.021 may include a
request that a proposition be submitted at the election to
determine whether the board may issue general obligation bonds if
the district is created. The petition must specify the maximum
amount of bonds to be issued and their maximum maturity date.
(b) Even though the petition does not request submission of a
proposition on whether the board may issue general obligation
bonds, the commissioners court may, on the request of a
petitioner, submit a proposition at the creation election on the
issuance of bonds.
(c) The board may issue general obligation bonds as provided by
Subchapter G if a majority of the votes cast in the election
favor creation of the district and issuance of the bonds.
Added by Acts 1991, 72nd Leg., ch. 648, Sec. 1, eff. Aug. 26,
1991.
Sec. 286.024. Election Order.
The order calling the election must state:
(1) the nature of the election, including the proposition
that is to appear on the ballot;
(2) the date of the election;
(3) the hours during which the polls will be open; and
(4) the location of the polling places.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.025. Notice.
(a) The commissioners court shall give notice of the election
by publishing a substantial copy of the election order in a
newspaper with general circulation in the proposed district once
a week for two consecutive weeks.
(b) The first publication must appear before the 35th day
before the date set for the election.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.026. Ballot Proposition.
(a) The ballot for the election shall be printed to permit
voting for or against the proposition: "The creation of the
__________ (name of district) Hospital District and the levy of
annual taxes for hospital purposes at a rate not to exceed
__________ (insert the amount prescribed by the petition, not to
exceed 75 cents) cents on each $100 valuation of all taxable
property in the district."
(b) If a bond proposition is submitted to the voters, the
ballot for the election shall be printed to permit voting for or
against the proposition: "The creation of the __________ (name
of district) Hospital District, the levy of annual taxes for
hospital purposes at a rate not to exceed __________ (insert the
amount prescribed by the petition, not to exceed 75 cents) cents
on each $100 valuation of all taxable property in the district,
and the issuance of bonds in an amount not to exceed __________
(insert the amount prescribed by the petition or the
commissioners court's order) and to mature not later than
__________ (insert the date prescribed by the petition or the
commissioners court's order)."
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991. Amended by Acts 1991, 72nd Leg., ch. 648, Sec. 2, eff.
Aug. 26, 1991.
Sec. 286.027. Election Result.
(a) Except as provided in Subsections (b) and (c), a district
is created and organized under this chapter if a majority of the
votes cast in the election favor creation of the district.
(b) If the proposed district contains territory in more than
one county, a majority of the votes cast in each county must also
favor creation of the district.
(c) If a majority of the votes cast in a county within the
proposed district are against the creation of the district and a
majority of the votes cast in the remaining county or counties
favor creation of the district, the district may be created only
in the counties voting in favor of the proposed district.
(d) If a majority of those voting at the election vote against
creation of the district, another election on the question of
creating the district may not be held before the first
anniversary of the most recent election concerning the creation
of the district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.028. Commissioners Court Order.
When a district is created, the commissioners court of each
county in which the district is located shall enter an order in
its minutes that reads substantially as follows:
"Whereas, at an election held on the __________ day of
__________, 19___, in that part of __________ County, State of
Texas, described as (insert description unless the district is
countywide), there was submitted to the qualified voters the
question of whether that territory should be formed into a
hospital district under state law; and
"Whereas, at the election __________ votes were cast in favor
of formation of the district and __________ votes were cast
against formation; and
"Whereas, the formation of the hospital district received the
affirmative vote of the majority of the votes cast at the
election as provided by law;
"Now, therefore, the Commissioners Court of __________ County,
State of Texas, finds and orders that the tract described in this
order has been duly and legally formed into a hospital district
(or a portion thereof) under the name of __________, under
Article IX, Section 9, of the Texas Constitution, and has the
powers vested by law in the district."
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.029. Overlapping Districts.
(a) If the territory in one or more districts overlaps, the
commissioners court of the county in which the most recently
created district is located by order shall exclude the
overlapping territory from that district.
(b) For purposes of this section, a district is created on the
date the election approving its creation was held. If the
elections approving the creation of two or more districts are
held on the same date, the most recently created district is the
district for which the hearing required by Section 286.023 was
most recently held.
(c) The fact that a district is created with boundaries that
overlap the boundaries of another district does not affect the
validity of either district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.030. Temporary Directors.
(a) On the date a commissioners court enters the order required
by Section 286.028, the commissioners court shall also appoint
the temporary directors of the district.
(b) If the petition prescribed by Section 286.021 specifically
names temporary directors, the commissioners court shall name
those persons to serve as temporary directors of the district.
If the petition requests that the commissioners court appoint the
temporary directors, the court shall appoint the appropriate
number of persons to serve as temporary directors of the
district. If the petition fails to name or state the number of
directors, there are five directors.
(c) If the district is located in more than one county, the
commissioners courts shall each appoint a percentage of temporary
directors equal to the ratio that the number of district
residents in the county bears to the total number of district
residents.
(d) From the time the district is created under Section 286.027
until the elected directors take office, the temporary directors
serve as directors of the district.
(e) The commissioners court shall fill a vacancy in the office
of temporary director by appointment.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
SUBCHAPTER C. DISTRICT ADMINISTRATION
Sec. 286.041. Board of Directors.
The directors shall be elected in accordance with the petition
prescribed by Section 286.021.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.042. Director's Election.
(a) The initial directors shall be elected at an election to be
held on the first Saturday in May following the creation of the
district.
(b) If the directors are elected at large:
(1) the appropriate number of candidates receiving the
highest number of votes at the initial election of directors
are directors for the district;
(2) the number of directors equal to a majority of the
directors who receive the highest number of votes at the
initial election serve for a term of two years; and
(3) the remaining directors serve for a term of one year.
(c) If the directors are elected by place:
(1) the candidate for a place receiving the highest number
of votes for election to that place is a director for the
district;
(2) a director elected to fill an even-numbered place at the
initial election serves for a term of one year; and
(3) a director elected to fill an odd-numbered place at the
initial election serves for a term of two years.
(d) If the directors are elected from commissioners precincts
and at large:
(1) the number of candidates equal to the number of
directors to be elected from each precinct who receive the
highest number of votes from a commissioner precinct are
directors for that precinct;
(2) the number of candidates equal to the number of
directors to be elected at large who receive the highest number
of votes from the district at large are directors for the
district at large;
(3) a candidate elected from an odd-numbered precinct at the
initial election serves for a term of two years;
(4) a candidate elected from an even-numbered precinct at
the initial election serves for a term of one year;
(5) a candidate elected as the director from the district at
large at the initial election serves for a term of two years;
and
(6) if more than one director is elected at large, half of
the directors elected serve two-year terms, and the other half
serve one-year terms.
(e) After the initial election of directors, an election shall
be held on the first Saturday in May each year to elect the
appropriate number of successor directors for two-year terms.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.043. Notice of Election.
Before the 35th day before the date of an election of
directors, notice of the election shall be published one time in
a newspaper with general circulation in the district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.044. Petition.
(a) A person who wishes to have the person's name printed on
the ballot as a candidate for director must file an application
with the secretary of the board.
(b) The application must be filed with the secretary not later
than the 31st day before the date of the election.
(c) If directors are elected by place, the application must
specify the place for which the applicant is to be a candidate.
(d) If the directors are elected from commissioners precincts
and at large, the application must specify:
(1) the commissioner precinct the candidate wishes to
represent; or
(2) that the candidate wishes to represent the district at
large.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.045. Qualifications for Office.
(a) To be eligible to be a candidate for or to serve as a
director, a person must be:
(1) a resident of the district; and
(2) a qualified voter.
(b) In addition to the qualifications required by Subsection
(a), if directors are elected from commissioners precincts, a
person who is elected from a commissioner precinct or who is
appointed to fill a vacancy for a commissioner precinct must be a
resident of that commissioner precinct.
(c) An employee of the district may not serve as a director.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.046. Bond.
(a) Before assuming the duties of the office, each director
must execute a bond for $5,000 payable to the district,
conditioned on the faithful performance of the person's duties as
director.
(b) The bond shall be kept in the permanent records of the
district.
(c) The board may pay for directors' bonds with district funds.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.047. Board Vacancy.
A vacancy in the office of director shall be filled for the
unexpired term by appointment by the remaining directors.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.048. Officers.
(a) The board shall elect from among its members a president
and a vice-president.
(b) The board shall appoint a secretary who need not be a
director.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.049. Officers' Terms; Vacancy.
(a) Each officer of the board serves for a term of one year.
(b) The board shall fill a vacancy in a board office for the
unexpired term.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.050. Compensation.
(a) Directors and officers serve without compensation but may
be reimbursed for actual expenses incurred in the performance of
official duties.
(b) Expenses reimbursed under this section must be:
(1) reported in the district's minute book or other district
records; and
(2) approved by the board.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.051. Voting Requirement.
A majority of the members of the board voting must concur in a
matter relating to the business of the district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.052. Administrator, Assistant Administrator, and Attorney.
(a) The board may appoint qualified persons as administrator of
the district, assistant administrator, and attorney for the
district.
(b) The administrator, assistant administrator, and attorney
serve at the will of the board.
(c) The administrator, assistant administrator, and attorney
are entitled to compensation as determined by the board.
(d) Before assuming the administrator's duties, the
administrator shall execute a bond payable to the hospital
district in an amount not less than $5,000 as determined by the
board, conditioned on the faithful performance of the
administrator's duties under this chapter. The board may pay for
the bond with district funds.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.053. Appointments to Staff.
The board may:
(1) appoint to the staff any doctors the board considers
necessary for the efficient operation of the district; and
(2) make temporary appointments the board considers
necessary.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.054. Technicians, Nurses, and Other District Employees.
(a) The district may employ technicians, nurses, fiscal agents,
accountants, architects, additional attorneys, and other
necessary employees.
(b) The board may delegate to the administrator the authority
to employ persons for the district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.055. General Duties of Administrator.
The administrator shall:
(1) supervise the work and activities of the district; and
(2) direct the general affairs of the district, subject to
the limitations prescribed by the board.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.056. Retirement Benefits.
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.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
SUBCHAPTER D. POWERS AND DUTIES
Sec. 286.071. Responsibility of Governmental Entity.
On creation of a district, a county, municipality, or other
governmental entity in which the district is located shall convey
or transfer to the district:
(1) title to land, buildings, improvements, and equipment related
to the hospital system located wholly in the district that are
owned by the county, municipality, or other governmental entity
in which the district is located;
(2) operating funds and reserves for operating expenses and funds
that have been budgeted by the county, municipality, or other
governmental entity in which the district is located to provide
medical care for residents of the district for the remainder of
the fiscal year in which the district is established;
(3) taxes levied by the county, municipality, or other
governmental entity in which the district is located for hospital
purposes for residents of the district for the year in which the
district is created; and
(4) funds established for payment of indebtedness assumed by the
district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.072. Limitation on Governmental Entity.
On or after creation of the district, a county, municipality,
or other governmental entity in which the district is located may
not levy taxes or issue bonds or other obligations for hospital
purposes or for providing medical care for the residents of the
district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.073. District Responsibilities.
(a) On creation of a district, the district:
(1) assumes full responsibility for operating hospital
facilities and for furnishing medical and hospital care for the
district's needy inhabitants;
(2) assumes any outstanding indebtedness incurred by a
county, municipality, or other governmental entity in which all
or part of the district is located in providing hospital care
for residents of the territory of the district before the
district's creation; and
(3) may operate or provide for the operation of a mobile
emergency medical service.
(b) If part of a county, municipality, or other governmental
entity is included in a district and part is not included in the
district, the amount of indebtedness the district assumes under
Subsection (a)(2) is that portion of the total outstanding
indebtedness of the county, municipality, or other entity for
hospital care for all residents of the county, municipality, or
other entity that the value of taxable property in the district
bears to the total value of taxable property in the county,
municipality, or other entity according to the last preceding
approved assessment rolls of the county, municipality, or other
entity before the district is confirmed.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.074. Management, Control, and Administration.
The board shall manage, control, and administer the hospital
system and the funds and resources of the district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.075. District Rules.
The board may adopt rules governing the operation of the
hospital and hospital system and the duties, functions, and
responsibilities of district staff and employees.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.076. Methods and Procedures.
The board may prescribe:
(1) the method of making purchases and expenditures by and
for the district; and
(2) accounting and control procedures for the district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.077. Hospital Property, Facilities, and Equipment.
(a) The board shall determine:
(1) the type, number, and location of buildings required to
establish and maintain an adequate hospital system; and
(2) the type of equipment necessary for hospital care.
(b) The board may:
(1) acquire property, facilities, and equipment for the
district for use in the hospital system;
(2) mortgage or pledge the property, facilities, or
equipment acquired as security for the payment of the purchase
price;
(3) transfer by lease to physicians, individuals, companies,
corporations, or other legal entities or acquire by lease
district hospital facilities; and
(4) sell or otherwise dispose of district property,
facilities, or equipment.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.078. Construction Contracts.
(a) The board may enter into construction contracts for the
district.
(b) The board may enter into construction contracts that
involve spending more than $10,000 only after competitive bidding
as provided by Subchapter B, Chapter 271 , Local Government Code.
(c) Chapter 2253, Government Code, as it relates to performance
and payment bonds, applies to construction contracts let by the
district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Amended by Acts 1995, 74th Leg., ch. 76, Sec. 5.95(17), eff.
Sept. 1, 1995.
Sec. 286.079. District Operating and Management Contracts.
The board may enter into operating or management contracts
relating to hospital facilities.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.080. Eminent Domain.
(a) A district may exercise the power of eminent domain to
acquire a fee simple or other interest in property located in the
territory of the district if the property interest is necessary
to the exercise of the rights or authority conferred by this
chapter.
(b) A district must exercise the power of eminent domain in the
manner provided by Chapter 21, Property Code, but the district is
not required to deposit in the trial court money or a bond as
provided by Section 21.021(a), Property Code.
(c) In a condemnation proceeding brought by a district, the
district is not required to:
(1) pay in advance or give bond or other security for costs
in the trial court;
(2) give bond for the issuance of a temporary restraining
order or a temporary injunction; or
(3) give bond for costs or supersedeas on an appeal or writ
of error.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.081. Expenses for Moving Facilities of Railroads or Utilities.
If, in exercising the power of eminent domain, the board
requires relocating, raising, lowering, rerouting, changing the
grade, or altering the construction of any railroad, highway,
pipeline, or electric transmission and electric distribution,
telegraph, or telephone lines, conduits, poles, or facilities,
the district must bear the actual cost of relocating, raising,
lowering, rerouting, changing the grade, or altering the
construction to provide comparable replacement without
enhancement of a facility, after deducting the net salvage value
derived from the old facility.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.082. Indigent Care.
(a) The district without charge shall supply to a patient
residing in the district the care and treatment that the patient
or a relative of the patient who is legally responsible for the
patient's support cannot pay.
(b) Not later than the first day of each operating year, the
district shall adopt an application procedure to determine
eligibility for assistance, as provided by Section 61.053.
(c) The administrator of the district may have an inquiry made
into the financial circumstances of:
(1) a patient residing in the district and admitted to a
district facility; and
(2) a relative of the patient who is legally responsible for
the patient's support.
(d) On finding that a patient or a relative of the patient
legally responsible for the patient's support can pay for all or
any part of the care and treatment provided by the district, the
administrator shall report that finding to the board, and the
board shall issue an order directing the patient or the relative
to pay the district each week a specified amount that the
individual is able to pay.
(e) The administrator may collect money owed to the district
from the estate of a patient or from that of a relative who was
legally responsible for the patient's support in the manner
provided by law for collection of expenses in the last illness of
a deceased person.
(f) If there is a dispute relating to an individual's ability
to pay or if the administrator has any doubt concerning an
individual's ability to pay, the board shall call witnesses, hear
and resolve the question, and issue a final order. An appeal
from a final order of the board must be made to a district court
in the county in which the district is located, and the
substantial evidence rule applies.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.083. Reimbursement for Services.
(a) The board shall require reimbursement from a county,
municipality, or public hospital located outside the boundaries
of the district for the district's care and treatment of a sick,
diseased, or injured person of that county, municipality, or
public hospital as provided by Chapter 61 (Indigent Health Care
and Treatment Act).
(b) The board shall require reimbursement from the sheriff or
police chief of a county or municipality 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.
(c) The board may contract with the state or federal government
for the state or federal government to reimburse the district for
treatment of a sick, diseased, or injured person.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.084. Service Contracts.
The board may contract with a municipality, county, special
district, or other political subdivision of the state or with a
state or federal agency for the district to:
(1) furnish a mobile emergency medical service; or
(2) provide for the investigatory or welfare needs of
inhabitants of the district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.085. Gifts and Endowments.
On behalf of the district, the board may accept gifts and
endowments to be held in trust for any purpose and under any
direction, limitation, or provision prescribed in writing by the
donor that is consistent with the proper management of the
district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.086. Authority to Sue and be Sued.
The board may sue and be sued on behalf of the district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
SUBCHAPTER E. CHANGE IN BOUNDARIES OR DISSOLUTION OF DISTRICT
Sec. 286.101. Expansion of District Territory.
(a) Registered voters of a defined territory that is not included
in a district may file a petition with the secretary of the board
requesting the inclusion of the territory in the district. The
petition must be signed by at least 50 registered voters of the
territory or a majority of those voters, whichever is less.
(b) The board by order shall set a time and place to hold a
hearing on the petition to include the territory in the district.
The board shall set a date for the hearing that is after the 30th
day after the date the board issues the order.
(c) If after the hearing the board finds that annexation of the
territory into the district would be feasible and would benefit
the district, the board may approve the annexation by a
resolution entered in its minutes. The board is not required to
include all of the territory described in the petition if the
board finds that a modification or change is necessary or
desirable.
(d) Annexation of territory is final when approved by a majority
of the voters at an election held in the district and by a
majority of the voters at a separate election held in the
territory to be annexed. If the district has outstanding debts
or taxes, the voters in the election to approve the annexation
must also determine if the annexed territory will assume its
proportion of the debts or taxes if added to the district.
(e) The election ballots shall be printed to provide for voting
for or against the following, as applicable:
(1) "Adding (description of territory to be added) to the
__________ Hospital District."
(2) "(Description of territory to be added) assuming its
proportionate share of the outstanding debts and taxes of the
__________ Hospital District, if it is added to the district."
(f) The election shall be held after the 45th day and on or
before the 60th day after the date the election is ordered. The
election shall be ordered and notice of the election shall be
given in the same manner as provided by Sections 286.024 and
286.025 for ordering and giving notice of an election authorizing
creation of the district. Section 41.001(a), Election Code, does
not apply to an election held under this section.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.102. Dissolution.
(a) A district may be dissolved as provided by this section.
(b) The board may order an election on the question of
dissolving the district and disposing of the district's assets
and obligations. The board shall order an election if the board
receives a petition requesting an election that is signed by a
number of residents of the district equal to at least 15 percent
of the registered voters in the district.
(c) The election shall be held not later than the 60th day
after the date the election is ordered. Section 41.001(a),
Election Code, does not apply to an election ordered under this
section.
(d) The ballot for the election shall be printed to permit
voting for or against the proposition: "The dissolution of the
__________ Hospital District." The election shall be held in
accordance with the applicable provisions of the Election Code.
(e) If a majority of the votes in the election favor
dissolution, the board shall find that the district is dissolved.
If a majority of the votes in the election do not favor
dissolution, the board shall continue to administer the district,
and another election on the question of dissolution may not be
held before the first anniversary of the most recent election to
dissolve the district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.103. Transfer of Assets After Dissolution.
(a) If a majority of the votes in the election favor
dissolution, the board shall:
(1) transfer the land, buildings, improvements, equipment,
and other assets that belong to the district to a county or
another governmental entity in the district; or
(2) administer the property, assets, and debts in accordance
with Section 286.104.
(b) If the district transfers the land, buildings,
improvements, equipment, and other assets to a county or other
governmental entity, the county or entity assumes all debts and
obligations of the district at the time of the transfer, and the
district is dissolved.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.104. Administration of Property, Debts, and Assets After
Dissolution.
(a) If the district does not transfer the land, buildings,
improvements, equipment, and other assets to a county or another
governmental entity in the district, the board shall continue to
control and administer the property, debts, and assets of the
district until all funds have been disposed of and all district
debts have been paid or settled.
(b) After the board finds that the district is dissolved, the
board shall:
(1) determine the debt owed by the district; and
(2) impose on the property included in the district's tax
rolls a tax that is in proportion of the debt to the property
value.
(c) The board may institute a suit to enforce payment of taxes
and to foreclose liens to secure the payment of taxes due the
district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.105. Return of Surplus Tax Money.
(a) When all outstanding debts and obligations of the district
are paid, the board shall order the secretary to return the pro
rata share of all unused tax money to each district taxpayer.
(b) A taxpayer may request that the taxpayer's share of surplus
tax money be credited to the taxpayer's county taxes. If a
taxpayer requests the credit, the board shall direct the
secretary to transmit the funds to the county tax
assessor-collector.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.106. Report; Dissolution Order.
(a) After the district has paid all its debts and has disposed
of all its assets and funds as prescribed by Sections 286.104 and
286.105, the board shall file a written report with the
commissioners court of each county in which the district is
located setting forth a summary of the board's actions in
dissolving the district.
(b) Not later than the 10th day after the date it receives the
report and determines that the requirements of this section have
been fulfilled, the commissioners court of each county shall
enter an order dissolving the district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
SUBCHAPTER F. DISTRICT FINANCES
Sec. 286.121. Fiscal Year.
(a) The district operates on the fiscal year established by the
board.
(b) The fiscal year may not be changed if revenue bonds of the
district are outstanding or more than once in a 24-month period.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.122. Annual Audit.
The board annually shall have an audit made of the financial
condition of the district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.123. District Audit and Records.
The annual audit and other district records are open to
inspection during regular business hours at the principal office
of the district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.124. Annual Budget.
(a) The administrator of the district shall prepare a proposed
annual budget for the district.
(b) The proposed budget must contain a complete financial
statement, including a statement of:
(1) the outstanding obligations of the district;
(2) the amount of cash on hand to the credit of each fund of
the district;
(3) the amount of money received by the district from all
sources during the previous year;
(4) the amount of money available to the district from all
sources during the ensuing year;
(5) the amount of the balances expected at the end of the
year in which the budget is being prepared;
(6) the estimated amount of revenues and balances available
to cover the proposed budget; and
(7) the estimated tax rate that will be required.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.125. Notice; Hearing; Adoption of Budget.
(a) The board shall hold a public hearing on the proposed
annual budget.
(b) The board shall publish notice of the hearing in a
newspaper of general circulation in the district not later than
the 10th day before the date of the hearing.
(c) Any resident of the district is entitled to be present and
participate at the hearing.
(d) At the conclusion of the hearing, the board shall adopt a
budget by acting on the budget proposed by the administrator.
The board may make any changes in the proposed budget that in its
judgment the interests of the taxpayers demand.
(e) The budget is effective only after adoption by the board.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.126. Amending Budget.
After adoption, the annual budget may be amended on the board's
approval.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.127. Limitation of Expenditures.
Money may not be spent for an expense not included in the
annual budget or an amendment to it.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.128. Sworn Statement.
As soon as practicable after the close of the fiscal year, the
administrator shall prepare for the board a sworn statement of
the amount of money that belongs to the district and an account
of the disbursements of that money.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.129. Spending and Investment Limitations.
(a) Except as provided by Section 286.078(a) and by Sections
286.141, 286.144, and 286.145, the district may not incur a debt
payable from revenues of the district other than the revenues on
hand or to be on hand in the current and immediately following
fiscal year of the district.
(b) The board may invest operating, depreciation, or building
reserves only in funds or securities specified by Article 836 or
837, Revised Statutes.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.130. Depository.
(a) The board shall name at least one bank to serve as
depository for district funds.
(b) District funds, other than those invested as provided by
Section 286.129(b) and those transmitted to a bank of payment for
bonds or obligations issued or assumed by the district, shall be
deposited as received with the depository bank and must remain on
deposit. This subsection does not limit the power of the board
to place a portion of district funds on time deposit or to
purchase certificates of deposit.
(c) Before the district deposits funds in a bank in an amount
that exceeds the maximum amount secured by the Federal Deposit
Insurance Corporation, the bank must execute a bond or other
security in an amount sufficient to secure from loss the district
funds that exceed the amount secured by the Federal Deposit
Insurance Corporation.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
SUBCHAPTER G. BONDS
Sec. 286.141. General Obligation Bonds.
The board may issue and sell bonds authorized by an election in
the name and on the faith and credit of the hospital district to:
(1) purchase, construct, acquire, repair, or renovate buildings
or improvements;
(2) equip buildings or improvements for hospital purposes; or
(3) acquire and operate a mobile emergency medical service.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.142. Taxes to Pay Bonds.
(a) At the time the bonds are issued by the district, the board
shall levy a tax.
(b) The tax must be sufficient to create an interest and
sinking fund to pay the principal of and interest on the bonds as
they mature.
(c) In any year, the tax together with any other tax the
district levies may not exceed the limit approved by the voters
at the election authorizing the levy of taxes.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.143. Bond Election.
(a) The district may issue general obligation bonds only if the
bonds are authorized by a majority of the qualified voters of the
district voting at an election called and held for that purpose
under this section or under Subchapter B.
(b) The board may order a bond election. The order calling the
election must state:
(1) the nature and date of the election;
(2) the hours during which the polls will be open;
(3) the location of the polling places;
(4) the amount of bonds to be authorized; and
(5) the maximum maturity of the bonds.
(c) Notice of a bond election shall be given as provided by
Article 704, Revised Statutes.
(d) The board shall canvass the returns and declare the results
of the election.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991. Amended by Acts 1991, 72nd Leg., ch. 648, Sec. 3, eff.
Aug. 26, 1991.
Sec. 286.144. Revenue Bonds.
(a) The board may issue revenue bonds to:
(1) purchase, construct, acquire, repair, equip, or renovate
buildings or improvements for hospital purposes;
(2) acquire sites to be used for hospital purposes; or
(3) acquire and operate a mobile emergency medical service
to assist the district in carrying out its hospital purposes.
(b) The bonds must be payable from and secured by a pledge of
all or part of the revenues derived from the operation of the
district's hospital system. The bonds may be additionally
secured by a mortgage or deed of trust lien on all or part of
district property.
(c) The bonds must be issued in the manner provided by Sections
264.042, 264.043, 264.046, 264.047, 264.048, and 264.049 for
issuance of revenue bonds by county hospital authorities.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.145. Refunding Bonds.
(a) Refunding bonds of the district may be issued to refund an
outstanding indebtedness the district has issued or assumed.
(b) 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).
(c) 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. 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).
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.146. Interest and Maturity.
District bonds must mature not later than the 50th anniversary
of the date of their issuance and 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).
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.147. Execution of Bonds.
The president of the board shall execute the bonds in the name
of the district, and the secretary of the board shall countersign
the bonds in the manner provided by the Texas Uniform Facsimile
Signature of Public Officials Act (Article 717j-1, Vernon's Texas
Civil Statutes).
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.148. Approval and Registration of Bonds.
(a) District bonds are subject to the same requirements with
regard to approval by the attorney general and registration by
the comptroller as the law provides for approval and registration
of bonds issued by counties.
(b) On approval by the attorney general and registration by the
comptroller, the bonds are incontestable for any cause.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.149. Bonds as Investments.
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 of the state and
other public funds of the state and its agencies, including the
permanent school fund.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.150. Bonds as Security for Deposits.
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.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.151. Tax Status of Bonds.
Because the district created under this chapter is a public
entity performing an essential public function, 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.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
SUBCHAPTER H. TAXES
Sec. 286.161. Levy of Taxes.
(a) The board annually may impose property taxes in an amount not
to exceed the limit approved by the voters at the election
authorizing the levy of taxes.
(b) The tax rate for all purposes may not exceed 75 cents on each
$100 valuation of all taxable property in the district.
(c) The taxes may be used to pay:
(1) the indebtedness issued or assumed by the district; and
(2) the maintenance and operating expenses of the district.
(d) The district may not impose taxes to pay the principal of or
interest on revenue bonds issued under this chapter.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.162. Board Authority.
The board may impose taxes for the entire year in which the
district is created.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.163. Adopting Tax Rate.
In adopting the tax rate, the board shall consider the income
of the district from sources other than taxation.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
Sec. 286.164. Tax Assessment and Collection.
(a) The Tax Code governs the appraisal, assessment, and
collection of district taxes.
(b) The board may provide for the appointment of a tax
assessor-collector for the district or may contract for the
assessment and collection of taxes as provided by the Tax Code.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
1991.
SUBCHAPTER I. MISCELLANEOUS
Sec. 286.181. Limitation on State Assistance.
The state may not become obligated for the support or maintenance
of a hospital district created under this chapter, and the
legislature may not make a direct appropriation for the
construction, maintenance, or improvement of a facility of the
district.
Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,
199