HBA-MSH, EDN C.S.H.B. 170 77(R)    BILL ANALYSIS


Office of House Bill AnalysisC.S.H.B. 170
By: Christian
County Affairs
2/25/2001
Committee Report (Substituted)



BACKGROUND AND PURPOSE 

Under current law, the Nacogdoches County Hospital District (district) is
not authorized to create a charitable organization or a nonprofit
corporation to provide or arrange for various health care services for the
district.  Such measures have been implemented in other hospital districts
in the state.  C.S.H.B. 170 sets forth and modifies provisions regarding
the issuance of bonds and public securities by the district and authorizes
the board of directors of the district to create a charitable organization
and a nonprofit corporation. 

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.H.B. 170 amends law relating to the powers and duties of the
Nacogdoches County Hospital District (district).  The bill authorizes the
board of directors of the district to create a charitable organization to
provide or arrange for hospital and health care services, develop resources
for hospital and health care services, and provide ancillary support
services for the district.  The bill further authorizes the board of
directors to sponsor and create a nonprofit corporation under the Texas
Non-Profit Corporation Act and to contribute funds to or solicit funds for
the corporation.  The corporation is authorized to use funds, other than
funds paid by the corporation to the district, only to provide health care
or other services the district is authorized to provide.  The bill requires
the board of directors to establish adequate controls to ensure that the
corporation uses its funds as mandated.  It authorizes the corporation to
invest corporation funds in any manner in which the district is authorized
to invest funds, including investing funds as authorized by the Public
Funds Investment Act. 

 The bill removes provisions relating to the sale or exchange of refunding
bonds issued by the district and sets forth provisions to provide that a
public security issued by the district must bear interest at a rate not to
exceed the maximum interest rate allowed for other public securities.  The
bill removes provisions requiring bonds issued by the district to bear
interest not to exceed six percent per year.  The bill modifies provisions
relating to the execution of such bonds and requires the bonds to be
subject to provisions regarding the examination and registration of public
securities.  

The bill provides that the application procedure to determine eligibility
for indigent health care must be adopted not later than the beginning of
each operating year and must comply with the Indigent Health Care and
Treatment Act.    

EFFECTIVE DATE

September 1, 2001.


 COMPARISON OF ORIGINAL TO SUBSTITUTE

The substitute differs from the original bill by removing provisions
relating to the election of directors of the district and the employment of
persons related to a director.  The substitute modifies provisions relating
to bonds and adds provisions relating to public securities.