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Statutes > Texas > Health-and-safety-code > Title-4-health-facilities > Chapter-286-hospital-districts-created-by-voter-approval

HEALTH AND SAFETY CODE

TITLE 4. HEALTH FACILITIES

SUBTITLE D. HOSPITAL DISTRICTS

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) whether the district is to impose a property tax and 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) whether the district is to impose a sales and use tax under

Subchapter I and the maximum tax rate to be voted on at the

creation election, which may not exceed the rate allowed under

that subchapter;

(8) the method by which the permanent directors will be elected,

as provided by Subsection (c); and

(9) 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. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 5, eff.

Sept. 1, 2001.

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. The commissioners court may grant a petition proposing

creation of a hospital district that imposes a sales and use tax

under Subchapter I only if all or a majority of the territory of

the district is located in a county or counties each with a

population of 75,000 or less.

(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 maximum tax rate

prescribed by the petition.

(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; Acts 2001, 77th Leg., ch. 1290, Sec. 6, eff.

Sept. 1, 2001.

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 an

election proposing to create a hospital district that imposes a

property tax 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 property 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) The ballot for an election proposing to create a hospital

district that imposes a sales and use tax under Subchapter I

shall be printed to permit voting for or against the proposition:

"The creation of the __________ (name of district) Hospital

District and the levy of sales and use taxes for hospital

purposes at a rate not to exceed __________ (insert the amount

prescribed by the petition, not to exceed the amount allowed

under Subchapter I) percent."

(c) If a bond proposition is submitted to the voters, the ballot

for the election shall contain the proposition prescribed by

Subsection (a) or (b) followed by: " 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; Acts 2001, 77th Leg., ch. 1290, Sec. 7, eff. Sept. 1,

2001.

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.

(g) If a district imposes a sales and use tax under Subchapter

I, the territory added to the district must be located in a

county or counties each with a population of 75,000 or less, and

the addition of the territory may not result in a combined tax

rate by the hospital district and other political subdivisions of

this state of more than two percent at any location in the

district.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 8, eff.

Sept. 1, 2001.

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 determine the debt owed by the district and:

(1) if the district imposes a property tax, impose on the

property included in the district's tax rolls a tax that is in

proportion of the debt to the property value; or

(2) if the district imposes a sales and use tax under Subchapter

I, continue the tax until the debt is repaid.

(c) The board may institute a suit to enforce payment of taxes

and to foreclose liens to secure the payment of property taxes

due the district.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 9, eff.

Sept. 1, 2001.

Sec. 286.105. RETURN OF SURPLUS PROPERTY 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 property tax money to each district taxpayer.

(b) A taxpayer may request that the taxpayer's share of surplus

property 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. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 10, eff.

Sept. 1, 2001.

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 property tax rate that will be required, if

the district imposes a property tax.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 11, eff.

Sept. 1, 2001.

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:

(1) bonds of the United States;

(2) certificates of indebtedness issued by the United States

secretary of the treasury;

(3) bonds of this state or a county, municipality, or school

district of this state; or

(4) shares or share accounts of savings and loan associations

organized under the laws of this state or federal savings and

loan associations domiciled in this state, if the shares or share

accounts are insured by the Federal Deposit Insurance

Corporation.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 8.101, eff.

Sept. 1, 2001.

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

Section 1251.003, Government Code.

(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; Acts 2001, 77th Leg., ch. 1420, Sec. 8.264, eff. Sept.

1, 2001.

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

Subchapter D, Chapter 1207, Government Code.

(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 Subchapters A-C, Chapter 1207,

Government Code.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 8.265, eff.

Sept. 1, 2001.

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 1204, Government Code.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 8.266, eff.

Sept. 1, 2001.

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 Chapter 618, Government Code.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 8.266, eff.

Sept. 1, 2001.

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. PROPERTY TAXES

Sec. 286.161. TAX AUTHORIZED. (a) A majority of voters in a

district or proposed district may, at the creation election under

Subchapter B or in conjunction with any other district election,

authorize the district to impose a property tax.

(b) 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.

(c) The tax rate for all purposes may not exceed 75 cents on

each $100 valuation of all taxable property in the district.

(d) 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.

(e) 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. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 13, eff.

Sept. 1, 2001.

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. SALES AND USE TAXES FOR DISTRICTS IN SMALL COUNTIES

Sec. 286.171. TAX AUTHORIZED. (a) A majority of voters in a

proposed district of which all or a majority of the territory is

located in a county or counties each with a population of 75,000

or less may impose a sales and use tax if the imposition is

authorized at the creation election under Subchapter B.

(b) An election to authorize the imposition of a sales and use

tax under this subchapter may be held only in conjunction with a

creation election under Subchapter B.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.172. LIMITATION ON COMBINED TAX RATE; EFFECT ON

ELECTIONS. An election to create a hospital district and to

authorize the imposition of a sales and use tax under this

subchapter, or an election to change the tax rate under Section

286.174, has no effect if as a result of the adoption of the

sales and use tax or the change in the rate the combined rate of

all sales and use taxes imposed by the district and other

political subdivisions of this state having territory in the

district would exceed two percent at any location in the

district.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.173. ELECTION IN OTHER TAXING AUTHORITY. (a) In this

section, "taxing authority" means any entity authorized to impose

a local sales and use tax.

(b) If a district or proposed district is included within the

boundaries of another taxing authority and the adoption or

increase of the tax under this subchapter would result in a

combined tax rate by the district and other political

subdivisions of this state of more than two percent at any

location in the district, an election to approve or increase the

tax under this subchapter has no effect unless:

(1) one or more of the other taxing authorities holds an

election in accordance with the law governing that authority on

the same date as the election under this chapter to reduce the

tax rate of that authority to a rate that will result in a

combined tax rate by the district and other political

subdivisions of not more than two percent at any location in the

district; and

(2) the combined tax rate is reduced to not more than two

percent as a result of that election.

(c) This section does not permit a taxing authority to impose

taxes at differential tax rates within the territory of the

authority.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.174. TAX RATE; CHANGE IN RATE. (a) A district may

impose the tax in increments of one-eighth of one percent, with a

minimum rate of one-eighth of one percent and a maximum rate of

two percent.

(b) Subject to Section 286.172, a district may increase the rate

of the tax to a maximum of two percent or decrease the rate of

the tax to a minimum of one-eighth of one percent if the change

is approved by a majority of the voters of the district at an

election called for that purpose.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.175. USE OF TAX. The taxes imposed may be used to pay:

(1) the indebtedness issued or assumed by the district; and

(2) the maintenance and operating expenses of the district.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.176. EFFECTIVE DATE. (a) The adoption or abolition of

the tax or a change in the rate of the tax takes effect on the

first day of the first calendar quarter occurring after the

expiration of the first complete calendar quarter occurring after

the date the comptroller receives a notice of the results of the

election.

(b) If the comptroller determines that an effective date

provided by Subsection (a) will occur before the comptroller can

reasonably take the action required to begin collecting the tax

or to implement the abolition of the tax or the change in the

rate of the tax, the effective date may be extended by the

comptroller until the first day of the next calendar quarter.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.177. COUNTY SALES AND USE TAX ACT APPLICABLE. Except

to the extent that a provision of this chapter applies, Chapter

323, Tax Code, applies to the tax authorized by this chapter in

the same manner as that chapter applies to the tax authorized by

that chapter.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

SUBCHAPTER X. MISCELLANEOUS

Sec. 286.951. 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,

1991. Renumbered from Sec. 286.181 by Acts 2001, 77th Leg., ch.

1290, Sec. 14, eff. Sept. 1, 2001.

State Codes and Statutes

Statutes > Texas > Health-and-safety-code > Title-4-health-facilities > Chapter-286-hospital-districts-created-by-voter-approval

HEALTH AND SAFETY CODE

TITLE 4. HEALTH FACILITIES

SUBTITLE D. HOSPITAL DISTRICTS

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) whether the district is to impose a property tax and 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) whether the district is to impose a sales and use tax under

Subchapter I and the maximum tax rate to be voted on at the

creation election, which may not exceed the rate allowed under

that subchapter;

(8) the method by which the permanent directors will be elected,

as provided by Subsection (c); and

(9) 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. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 5, eff.

Sept. 1, 2001.

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. The commissioners court may grant a petition proposing

creation of a hospital district that imposes a sales and use tax

under Subchapter I only if all or a majority of the territory of

the district is located in a county or counties each with a

population of 75,000 or less.

(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 maximum tax rate

prescribed by the petition.

(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; Acts 2001, 77th Leg., ch. 1290, Sec. 6, eff.

Sept. 1, 2001.

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 an

election proposing to create a hospital district that imposes a

property tax 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 property 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) The ballot for an election proposing to create a hospital

district that imposes a sales and use tax under Subchapter I

shall be printed to permit voting for or against the proposition:

"The creation of the __________ (name of district) Hospital

District and the levy of sales and use taxes for hospital

purposes at a rate not to exceed __________ (insert the amount

prescribed by the petition, not to exceed the amount allowed

under Subchapter I) percent."

(c) If a bond proposition is submitted to the voters, the ballot

for the election shall contain the proposition prescribed by

Subsection (a) or (b) followed by: " 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; Acts 2001, 77th Leg., ch. 1290, Sec. 7, eff. Sept. 1,

2001.

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.

(g) If a district imposes a sales and use tax under Subchapter

I, the territory added to the district must be located in a

county or counties each with a population of 75,000 or less, and

the addition of the territory may not result in a combined tax

rate by the hospital district and other political subdivisions of

this state of more than two percent at any location in the

district.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 8, eff.

Sept. 1, 2001.

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 determine the debt owed by the district and:

(1) if the district imposes a property tax, impose on the

property included in the district's tax rolls a tax that is in

proportion of the debt to the property value; or

(2) if the district imposes a sales and use tax under Subchapter

I, continue the tax until the debt is repaid.

(c) The board may institute a suit to enforce payment of taxes

and to foreclose liens to secure the payment of property taxes

due the district.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 9, eff.

Sept. 1, 2001.

Sec. 286.105. RETURN OF SURPLUS PROPERTY 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 property tax money to each district taxpayer.

(b) A taxpayer may request that the taxpayer's share of surplus

property 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. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 10, eff.

Sept. 1, 2001.

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 property tax rate that will be required, if

the district imposes a property tax.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 11, eff.

Sept. 1, 2001.

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:

(1) bonds of the United States;

(2) certificates of indebtedness issued by the United States

secretary of the treasury;

(3) bonds of this state or a county, municipality, or school

district of this state; or

(4) shares or share accounts of savings and loan associations

organized under the laws of this state or federal savings and

loan associations domiciled in this state, if the shares or share

accounts are insured by the Federal Deposit Insurance

Corporation.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 8.101, eff.

Sept. 1, 2001.

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

Section 1251.003, Government Code.

(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; Acts 2001, 77th Leg., ch. 1420, Sec. 8.264, eff. Sept.

1, 2001.

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

Subchapter D, Chapter 1207, Government Code.

(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 Subchapters A-C, Chapter 1207,

Government Code.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 8.265, eff.

Sept. 1, 2001.

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 1204, Government Code.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 8.266, eff.

Sept. 1, 2001.

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 Chapter 618, Government Code.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 8.266, eff.

Sept. 1, 2001.

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. PROPERTY TAXES

Sec. 286.161. TAX AUTHORIZED. (a) A majority of voters in a

district or proposed district may, at the creation election under

Subchapter B or in conjunction with any other district election,

authorize the district to impose a property tax.

(b) 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.

(c) The tax rate for all purposes may not exceed 75 cents on

each $100 valuation of all taxable property in the district.

(d) 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.

(e) 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. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 13, eff.

Sept. 1, 2001.

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. SALES AND USE TAXES FOR DISTRICTS IN SMALL COUNTIES

Sec. 286.171. TAX AUTHORIZED. (a) A majority of voters in a

proposed district of which all or a majority of the territory is

located in a county or counties each with a population of 75,000

or less may impose a sales and use tax if the imposition is

authorized at the creation election under Subchapter B.

(b) An election to authorize the imposition of a sales and use

tax under this subchapter may be held only in conjunction with a

creation election under Subchapter B.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.172. LIMITATION ON COMBINED TAX RATE; EFFECT ON

ELECTIONS. An election to create a hospital district and to

authorize the imposition of a sales and use tax under this

subchapter, or an election to change the tax rate under Section

286.174, has no effect if as a result of the adoption of the

sales and use tax or the change in the rate the combined rate of

all sales and use taxes imposed by the district and other

political subdivisions of this state having territory in the

district would exceed two percent at any location in the

district.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.173. ELECTION IN OTHER TAXING AUTHORITY. (a) In this

section, "taxing authority" means any entity authorized to impose

a local sales and use tax.

(b) If a district or proposed district is included within the

boundaries of another taxing authority and the adoption or

increase of the tax under this subchapter would result in a

combined tax rate by the district and other political

subdivisions of this state of more than two percent at any

location in the district, an election to approve or increase the

tax under this subchapter has no effect unless:

(1) one or more of the other taxing authorities holds an

election in accordance with the law governing that authority on

the same date as the election under this chapter to reduce the

tax rate of that authority to a rate that will result in a

combined tax rate by the district and other political

subdivisions of not more than two percent at any location in the

district; and

(2) the combined tax rate is reduced to not more than two

percent as a result of that election.

(c) This section does not permit a taxing authority to impose

taxes at differential tax rates within the territory of the

authority.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.174. TAX RATE; CHANGE IN RATE. (a) A district may

impose the tax in increments of one-eighth of one percent, with a

minimum rate of one-eighth of one percent and a maximum rate of

two percent.

(b) Subject to Section 286.172, a district may increase the rate

of the tax to a maximum of two percent or decrease the rate of

the tax to a minimum of one-eighth of one percent if the change

is approved by a majority of the voters of the district at an

election called for that purpose.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.175. USE OF TAX. The taxes imposed may be used to pay:

(1) the indebtedness issued or assumed by the district; and

(2) the maintenance and operating expenses of the district.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.176. EFFECTIVE DATE. (a) The adoption or abolition of

the tax or a change in the rate of the tax takes effect on the

first day of the first calendar quarter occurring after the

expiration of the first complete calendar quarter occurring after

the date the comptroller receives a notice of the results of the

election.

(b) If the comptroller determines that an effective date

provided by Subsection (a) will occur before the comptroller can

reasonably take the action required to begin collecting the tax

or to implement the abolition of the tax or the change in the

rate of the tax, the effective date may be extended by the

comptroller until the first day of the next calendar quarter.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.177. COUNTY SALES AND USE TAX ACT APPLICABLE. Except

to the extent that a provision of this chapter applies, Chapter

323, Tax Code, applies to the tax authorized by this chapter in

the same manner as that chapter applies to the tax authorized by

that chapter.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

SUBCHAPTER X. MISCELLANEOUS

Sec. 286.951. 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,

1991. Renumbered from Sec. 286.181 by Acts 2001, 77th Leg., ch.

1290, Sec. 14, eff. Sept. 1, 2001.


State Codes and Statutes

State Codes and Statutes

Statutes > Texas > Health-and-safety-code > Title-4-health-facilities > Chapter-286-hospital-districts-created-by-voter-approval

HEALTH AND SAFETY CODE

TITLE 4. HEALTH FACILITIES

SUBTITLE D. HOSPITAL DISTRICTS

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) whether the district is to impose a property tax and 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) whether the district is to impose a sales and use tax under

Subchapter I and the maximum tax rate to be voted on at the

creation election, which may not exceed the rate allowed under

that subchapter;

(8) the method by which the permanent directors will be elected,

as provided by Subsection (c); and

(9) 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. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 5, eff.

Sept. 1, 2001.

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. The commissioners court may grant a petition proposing

creation of a hospital district that imposes a sales and use tax

under Subchapter I only if all or a majority of the territory of

the district is located in a county or counties each with a

population of 75,000 or less.

(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 maximum tax rate

prescribed by the petition.

(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; Acts 2001, 77th Leg., ch. 1290, Sec. 6, eff.

Sept. 1, 2001.

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 an

election proposing to create a hospital district that imposes a

property tax 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 property 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) The ballot for an election proposing to create a hospital

district that imposes a sales and use tax under Subchapter I

shall be printed to permit voting for or against the proposition:

"The creation of the __________ (name of district) Hospital

District and the levy of sales and use taxes for hospital

purposes at a rate not to exceed __________ (insert the amount

prescribed by the petition, not to exceed the amount allowed

under Subchapter I) percent."

(c) If a bond proposition is submitted to the voters, the ballot

for the election shall contain the proposition prescribed by

Subsection (a) or (b) followed by: " 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; Acts 2001, 77th Leg., ch. 1290, Sec. 7, eff. Sept. 1,

2001.

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.

(g) If a district imposes a sales and use tax under Subchapter

I, the territory added to the district must be located in a

county or counties each with a population of 75,000 or less, and

the addition of the territory may not result in a combined tax

rate by the hospital district and other political subdivisions of

this state of more than two percent at any location in the

district.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 8, eff.

Sept. 1, 2001.

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 determine the debt owed by the district and:

(1) if the district imposes a property tax, impose on the

property included in the district's tax rolls a tax that is in

proportion of the debt to the property value; or

(2) if the district imposes a sales and use tax under Subchapter

I, continue the tax until the debt is repaid.

(c) The board may institute a suit to enforce payment of taxes

and to foreclose liens to secure the payment of property taxes

due the district.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 9, eff.

Sept. 1, 2001.

Sec. 286.105. RETURN OF SURPLUS PROPERTY 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 property tax money to each district taxpayer.

(b) A taxpayer may request that the taxpayer's share of surplus

property 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. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 10, eff.

Sept. 1, 2001.

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 property tax rate that will be required, if

the district imposes a property tax.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 11, eff.

Sept. 1, 2001.

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:

(1) bonds of the United States;

(2) certificates of indebtedness issued by the United States

secretary of the treasury;

(3) bonds of this state or a county, municipality, or school

district of this state; or

(4) shares or share accounts of savings and loan associations

organized under the laws of this state or federal savings and

loan associations domiciled in this state, if the shares or share

accounts are insured by the Federal Deposit Insurance

Corporation.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 8.101, eff.

Sept. 1, 2001.

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

Section 1251.003, Government Code.

(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; Acts 2001, 77th Leg., ch. 1420, Sec. 8.264, eff. Sept.

1, 2001.

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

Subchapter D, Chapter 1207, Government Code.

(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 Subchapters A-C, Chapter 1207,

Government Code.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 8.265, eff.

Sept. 1, 2001.

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 1204, Government Code.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 8.266, eff.

Sept. 1, 2001.

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 Chapter 618, Government Code.

Added by Acts 1991, 72nd Leg., ch. 14, Sec. 121, eff. Sept. 1,

1991. Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 8.266, eff.

Sept. 1, 2001.

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. PROPERTY TAXES

Sec. 286.161. TAX AUTHORIZED. (a) A majority of voters in a

district or proposed district may, at the creation election under

Subchapter B or in conjunction with any other district election,

authorize the district to impose a property tax.

(b) 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.

(c) The tax rate for all purposes may not exceed 75 cents on

each $100 valuation of all taxable property in the district.

(d) 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.

(e) 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. Amended by Acts 2001, 77th Leg., ch. 1290, Sec. 13, eff.

Sept. 1, 2001.

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. SALES AND USE TAXES FOR DISTRICTS IN SMALL COUNTIES

Sec. 286.171. TAX AUTHORIZED. (a) A majority of voters in a

proposed district of which all or a majority of the territory is

located in a county or counties each with a population of 75,000

or less may impose a sales and use tax if the imposition is

authorized at the creation election under Subchapter B.

(b) An election to authorize the imposition of a sales and use

tax under this subchapter may be held only in conjunction with a

creation election under Subchapter B.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.172. LIMITATION ON COMBINED TAX RATE; EFFECT ON

ELECTIONS. An election to create a hospital district and to

authorize the imposition of a sales and use tax under this

subchapter, or an election to change the tax rate under Section

286.174, has no effect if as a result of the adoption of the

sales and use tax or the change in the rate the combined rate of

all sales and use taxes imposed by the district and other

political subdivisions of this state having territory in the

district would exceed two percent at any location in the

district.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.173. ELECTION IN OTHER TAXING AUTHORITY. (a) In this

section, "taxing authority" means any entity authorized to impose

a local sales and use tax.

(b) If a district or proposed district is included within the

boundaries of another taxing authority and the adoption or

increase of the tax under this subchapter would result in a

combined tax rate by the district and other political

subdivisions of this state of more than two percent at any

location in the district, an election to approve or increase the

tax under this subchapter has no effect unless:

(1) one or more of the other taxing authorities holds an

election in accordance with the law governing that authority on

the same date as the election under this chapter to reduce the

tax rate of that authority to a rate that will result in a

combined tax rate by the district and other political

subdivisions of not more than two percent at any location in the

district; and

(2) the combined tax rate is reduced to not more than two

percent as a result of that election.

(c) This section does not permit a taxing authority to impose

taxes at differential tax rates within the territory of the

authority.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.174. TAX RATE; CHANGE IN RATE. (a) A district may

impose the tax in increments of one-eighth of one percent, with a

minimum rate of one-eighth of one percent and a maximum rate of

two percent.

(b) Subject to Section 286.172, a district may increase the rate

of the tax to a maximum of two percent or decrease the rate of

the tax to a minimum of one-eighth of one percent if the change

is approved by a majority of the voters of the district at an

election called for that purpose.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.175. USE OF TAX. The taxes imposed may be used to pay:

(1) the indebtedness issued or assumed by the district; and

(2) the maintenance and operating expenses of the district.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.176. EFFECTIVE DATE. (a) The adoption or abolition of

the tax or a change in the rate of the tax takes effect on the

first day of the first calendar quarter occurring after the

expiration of the first complete calendar quarter occurring after

the date the comptroller receives a notice of the results of the

election.

(b) If the comptroller determines that an effective date

provided by Subsection (a) will occur before the comptroller can

reasonably take the action required to begin collecting the tax

or to implement the abolition of the tax or the change in the

rate of the tax, the effective date may be extended by the

comptroller until the first day of the next calendar quarter.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

Sec. 286.177. COUNTY SALES AND USE TAX ACT APPLICABLE. Except

to the extent that a provision of this chapter applies, Chapter

323, Tax Code, applies to the tax authorized by this chapter in

the same manner as that chapter applies to the tax authorized by

that chapter.

Added by Acts 2001, 77th Leg., ch. 1290, Sec. 14, eff. Sept. 1,

2001.

SUBCHAPTER X. MISCELLANEOUS

Sec. 286.951. 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,

1991. Renumbered from Sec. 286.181 by Acts 2001, 77th Leg., ch.

1290, Sec. 14, eff. Sept. 1, 2001.