Untitled Texas Attorney General Opinion ( 1988 )

THE ATTORNEY GENERAL
OF TEXAS
February 23, 1988
Honorabl'e Ashley Smith Opinion No. JR-864
Chairman
Government Organization Re: Authority of Amarillo
Committee Hospital District to dis-
Texas House of Representatives pose of Northwest Texas
P. 0. Box 2910 Hospital (RQ-1277)
Austin, Texas 78769
Dear Representative Smith:
You ask several questions pertaining to the City of
Amarillo Hospital District (AHD). The AHD was authorized
by article IX, section 5, of the Texas Constitution and
created by Acts 1957, 55th Leg., ch. 136, at 298. Because
the creating statute predated the effective date of the
C ~constitutional amendment authorizing the district, the
legislature Walidatedql the enabling statute by enacting
House Bill No. 70 by Acts 1959, 56th Leg., ch. 32, at 59.
House Bill No. 70 was essentially a reenactment of the
earlier statute with a few amendments.
The boundaries of the AHD are coextensive with the
boundaries of the city of Amarillo. Tex . Const. art. IX,
95(a). The constitutional provision as originally adopted
authorized the legislature to permit Potter County to levy
a tax in that portion of the county outside the city
limits of Amarillo to render financial aid to the dis-
trict. Art. IX, 55(b). A similar provision relating to
Randall County was added to the constitution in 1987.
Art. IX, 55(e). Thus, Potter and Randall County residents
who are not residents of a hospital district may be served
by the AHD.~ Acts 1957, 55th Leg., ch. 136, 516, at 304,
as amended by Acts 1959, 56th Leg., ch. 32, 516, at 66 and
Acts 1987, 70th Leg., 2nd C.S., ch. 71, 54, at 454.
1. Randall County has not yet held an election on
the question of participating in the AHD.
P. 4188
Honorable Ashley Smith - Page 2 (JM-864)
We restate your questions as follows:
1. Does the AHD board of managers or the
Amarillo City Commission own and operate the
Northwest Texas Hospital?
2. Who has final authority to sell,
lease, or close the hospital? Which entity,
the hospital district board or the Amarillo
City Commission, must determine that the
sale, lease, or closure of the hospital
is in the best interest of the district's
residents?
3. Is an election required to approve
the sale or lease of the Northwest Texas
Hospital to another entity?
4. If the hospital is sold, leased, or
closed, what is the hospital district's
responsibility to the persons it serves?
The AHD operates the Northwest Texas Hospital. Con-
fusion about the authority of the board of managers of
the hospital district may stem from the fact that the
governing body of the city of Amarillo also has statutory
responsibilities in relation to this hospital district.
The district's enabling legislation provides in pertinent
part:
Sec. 1. The City of Amarillo, Texas, may
be constituted a Hospital District . . . for
the nurnose of ownina and oneratina a hos-
pital or hOsnita1 svstem for indiaent and
need!? nersons. . . .
. . . .
Sec. 4. a. Any lands, buildinas or eouin-
ment that may be jointly or separately owned
by the City of Amarillo and the County of
Potter, within the hospital district, and by
which medical services or hospital care are
furnished to the indiaent . . . shall become
the nrooertv of the HosDital District: and
title thereto shall vest in the HOSDital
District. . . ,
Sec. 5. a. The aovernina bodv of the Citv
of Amarillo shall annoint a Board of HOSDital
P. 4189
Honorable Ashley Smith - Page 3 (JM-864)
Manaaers . whose duties shall be to
manaae. control and administer the hosnital
gr hosDita1 sv tem of the HOSDital Dis-
trict. . . . T:e Board is authorized to
promula t rules and reculations for the
0Dera tiEne of the hOSDita1 or hosoital
svstem. . . .
Sec. 6. The governing body of the City of
Amarillo shall have the power to prescribe
the method and manner of making purchases and
expenditures by and for such Hospital Dis-
trict . . . or may delegate any or all such
powers to the Board of Managers. . . .
. . . .
Sec. 9. a. The Hospital District . . .
shall have the right and power of. eminent
domain. . . .
b. The HOSDital District shall have the
power to take by purchase or lease lands
within or without the district as may be
required for its purpose: and it mav sell or
lease anv lands owned bv it at DUblic r
private sale: nrovided. h wever. that io
real estate mav be sold zr leased until
titer there h s been a determination bv the
aovernina bodt of the Citv of Amarillo that
either the lands are 1 a r reouired f
the nurnoses of the %.t% or that t:E
arantee or lessee will use the DroDertv for
hOSDita1 nurnoses or ourDOses incidental and
JIecessarv to hosDita1 DurDoses. (Emphasis
added.)
Acts 1957, 55th Leg., ch. 136 as amended by Acts 1959,
56th Leg., ch. 32.
In answer to your first question, it is clear from
the language quoted above in sections 4, 5, and 9 that the
hospital district owns Northwest Texas Hospital and that
the board of managers operates the facility.
Next you ask about the authority to sell, lease, or
close the hospital. Section 9(b) of the district's
enabling statute quoted above addresses the sale of m.
However, article 4437c-2, V.T.C.S., is a later enactment
of the legislature that is specifically concerned with the
p. 4190
Honorable Ashley Smith - Page 4 (JM-864)
sale, lease, or closure of hospitals. In our opinion,
this article answers your second and third questions. The
statute provides in pertinent part:
Section 1. In this Act, 'official action'
means . . . a resolution adopted by the
governing body of a hospital district.
Section 2. (a) The governing body of
. . . a hospital district by official action
may order the sale, lease, or closure of all
or any part of, including real property, a
hospital owned and operated by the political
subdivision. The official action must
include a finding by the governing body that
the sale, lease, or closure is in the best
interest of the residents of the political
subdivision.
. . . .
(c) The sale or closure of a hospital is
contingent on the right of the voters by
petition to require a referendum on the
issue. The sale or closure may not take
effect sooner than the expiration of the time
for a petition to be filed under Section 3 of
this Act and, if a valid petition is filed,
the sale or closure is contingent on voter
approval.
. . . .
Section 3. (a) If before the 31st day
after the date on which the governing body
orders that a hospital be sold or closed the
governing body receives a petition signed by
at least 10 percent of the qualified voters
of the political subdivision requesting an
election on the question, the governing body
.shall order and conduct an election.
(b) . . . If a majority of the qualified
voters voting on the question approve the
sale or closure, the hospital may be sold or
closed.
V.T.C.S. art. 4437c-2.
P. 4191
Honorable Ashley Smith - Page 5 (JM-864)
Pursuant to article 4437c-2, V.T.C.S., the board of
managers of the hospital district has authority to sell,
lease, or close the Northwest Texas Hospital after the
board determines that such action is in the best interest
of the district's residents.
Article 4437c-2, V.T.C.S., does not give the city of
Amarillo's governing body any authority to participate in
a decision by the hospital district's board of managers to
sell, lease, or close its hospital facility. If the
proposed action .is a sale or closure of the facility, the
voters may petition for an election on the issue of
approving or disapproving the proposed sale or closure.
An election is not required unless the petition reguire-
ments of article 4437c-2, V.T.C.S., are satisfied. See
Jackson Countv Hosrdtal District v. Jackson County
Citizens For Continued HOSDital Care, 669 S.W.2d 147 (Tex.
APP. - Corpus Christi 1984, no writ).
Finally, you ask about the hospital district's re-
sponsibility to the persons it serves if the Northwest
Texas Hospital is sold, leased, or closed. The constitu-
tional provision and statute governing the AHD require the
district to provide medical care to the needy inhabitants
of the district and to residents of Potter County who
are outside the district's boundaries. Tex. Const. art.
IX, 55; Acts 1957, 55th Leg., ch. 136, as amended. If
apprpved by the voters of Randall County, the district
will also be responsible for the care of Randall County
residents who do not reside in a hospital district.
Pursuant to the Indigent Health Care and Treatment
Act (article 4438f, V.T.C.S.) a hospital district has a
mandatory duty to provide the health care services
required under the Texas Constitution and the statute
creating the district. V.T.C.S. art. 4438f, 511.02. In
accordance with section 11.03 of the Indigent Health Care
and Treatment Act, a hospital district may arrange to
provide health care services through other public
facilities, by contracting with a private provider, or
through the purchase of insurance for eligible residents.
The district may also affiliate with other public
hospitals, hospital districts or governmental entities to
provide regional administration and delivery of health
care services. &S Attorney General Opinion JM-858
(1988).
Regardless of the method chosen by the hospital
district to provide services to its eligible recipients,
the district is liable for the health care services as
P. 4192
Honorable Ashley Smith - Page 6 (JM-864)
provided by the constitution and its statute. V.T.C.S.
art. 4438f, 512.01(b). Thus, the sale, closure, or lease
of the Northwest Texas Hospital will have no effect on the -
legal responsibility that the AHD has towards the persons
it serves.
SUMMARY
The City of Amarillo Hospital District
owns the Northwest Texas Hospital. The board
of managers of the hospital district operates
.the facility.
Pursuant to article 4437c-2, V.T.C.S.,
the hospital district's board of managers may
sell, lease, or close a hospital after a
finding that such action is in the best
interest of the district's residents. The
voters of the district may petition for an
election on the issue of selling or closing a
hospital.
If the Northwest Texas Hospital is sold,
leased, or closed, the City of Amarillo ,-.
Hospital District continues to be legally
responsible for providing medical care
pursuant to the Indigent Health Care and
Treatment Act.
Ll htJ%
Very truly yo ,
/L
JIM MATTOX
Attorney General of Texas
MARY KELLER
First Assistant Attorney General
LOU MCCREARY
Executive Assistant Attorney General
JUDGE ZOLLIE STEAKLEY
Special Assistant Attorney General
‘I
RICK GILPIN
Chairman, Opinion Committee
Prepared by Karen C. Gladney
Assistant Attorney General