PART II. BUDGET AND FINANCE

 

§323F-21  Fiscal provisions.  (a)  Thereis created in the state treasury a special fund to be known as the healthsystems special fund, into which shall be deposited all fees, proceeds,reimbursements, and the like owed to or received by the corporation, anyregional system board, and its facilities, except as herein provided.  Thereshall be established within the special fund regional subaccounts for eachregional system board upon its establishment.  The special fund and theregional subaccounts shall be used solely to fulfill the purposes outlined inthis chapter.

The corporation and each regional system boardmay establish and maintain, within the health systems special fund or anyregional subaccount, any other accounts that may be necessary and appropriateto carry out its purposes and responsibilities.

The corporation and any regional system boardmay deposit moneys into trustee accounts for the purposes of securing orissuing bonds.

The corporation and regional system boards mayprovide reasonable reserves for any of the following purposes:

(1)  Insurance deductibles;

(2)  The improvement, replacement, or expansion oftheir facilities or services;

(3)  The securing of the corporation's or regionalsystem boards' bonds, notes, or other instruments of indebtedness; or

(4)  Any other purpose the corporation or the regionalsystem boards deem necessary or appropriate in the performance of theirpurposes and responsibilities.

(b)  The corporation board and regional systemboards shall collaboratively develop budgetary guidelines and annual operatingand capital budgets for each facility, taking into account anticipatedsurpluses from or subsidies to the facilities pursuant to the annual guidelinesdescribed in this section, accumulated corporation and regional reserves andaccounts, subsidies, if any, that are determined to be needed from the generalfund, and other sources of corporation-wide and regional income as may beidentified.  Two-year budgets will be approved for regional system boards, inalignment with State of Hawaii biennium budgeting.  The corporate board shallnot alter the two-year budget of a regional system except:

(1)  Where state general funding is reduced;

(2)  An emergency exists; or

(3)  There is a renegotiated budget approved by aregional system board.

The corporation and regional system boards shallcollaboratively develop budgetary guidelines and negotiate with each facilityreasonable corporation administrative costs, including funds determined by thecorporation or any regional system board to be needed from or provided to eachfacility to:

(1)  Repay corporation or regional system board debts;

(2)  Provide subsidies to any facility determined tobe unable to fund from within that facility's programs and services deemedessential to community needs; and

(3)  Maintain appropriate reserves.

(c)  The corporation and regional system boardsshall collaboratively develop annual corporation operating and capital budgets,taking into account anticipated surpluses from or subsidies to the facilitiespursuant to the annual guidelines described in this section, accumulatedcorporation and regional system board reserves and accounts, subsidies, if any,that are determined to be needed from the general fund, and other sources ofcorporation-wide and regional system board income as may be identified.

(d)  Beginning with the first of thelegislative biennium budget years following the establishment of a regionalsystem board, and for each biennium period thereafter, the corporation shallcall together all the regional systems through representatives selected by eachregional system board, and the chairs of the facility management advisorycommittees, if any, to determine which services and functions should be providedby the corporation for the next biennium budget period, consistent with thischapter.  As part of the biennium budgeting process, the corporation board andthe representatives of each regional system, working through the corporationboard regional representatives, shall agree upon an allocation methodology forfunding the agreed upon and statutorily created corporate services andfunctions.

(e)  The corporation may share in anyfacility's surplus and may offset any facility's deficits as provided herein. Any regional system board shall share in the surplus of any facility within theregional system and shall offset any facility deficits within its regionalsystem.  Operating surpluses of the regional system board shall be reinvestedin the operations of that regional system in any prudent manner; provided thatupon request, and subject to authorization by the regional system board, theregional system board may share its surplus or resources with a facilityoutside of the regional system to benefit the corporation-wide system of healthcare.  Obligations undertaken by a facility shall be paid only from funds ofthat facility, unless the corporation board, the regional system board managingthe facility, or an authorized agent explicitly agrees to guarantee theobligation.  Loans and other transfers may be made between regional systemsupon approval of the affected regional system boards to assist in the cash flowand operations of the public health facilities.

(f)  In accordance with each annual facilitybudget, and subject to policies established by the corporation board and byeach regional system board, each facility of the corporation and regionalsystem board, respectively, shall:

(1)  Bill and collect for its services;

(2)  Maintain bank accounts; and

(3)  Pay for needed personnel, supplies, equipment,and other operational and capital expenditures.

(g)  The corporation and each regional systemboard, subject to policies established by the corporation and each regionalsystem board, respectively, may elect to manage its own capital improvementproject and funds, either directly or indirectly by contract; provided thatannual reports of the project moneys are provided to the governor andlegislature.

(h)  The corporation board and regional systemboards may hold public informational meetings on their budgets. Representatives of any county government, state government, or any other personhaving an interest in the budget, shall have the right to be heard at themeetings. [L 1996, c 262, pt of §2; am L 2007, c 290, §30]