Florida Senate - 2011                        COMMITTEE AMENDMENT
       Bill No. SB 1448
       
       
       
       
       
       
                                Barcode 114164                          
       
                              LEGISLATIVE ACTION                        
                    Senate             .             House              
                  Comm: RCS            .                                
                  04/04/2011           .                                
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       The Committee on Community Affairs (Wise) recommended the
       following:
       
    1         Senate Amendment (with title amendment)
    2  
    3         Delete everything after the enacting clause
    4  and insert:
    5         Section 1. Subsections (1) and (4) of section 155.40,
    6  Florida Statutes, are amended, subsections (5) through (8) are
    7  renumbered as subsections (14) through (17), respectively, and
    8  new subsections (5) through (13) are added to that section, to
    9  read:
   10         155.40 Sale or lease of county, district, or municipal
   11  hospital; effect of sale.—
   12         (1) In order for that citizens and residents of the state
   13  to may receive quality health care, any county, district, or
   14  municipal hospital organized and existing under the laws of this
   15  state, acting by and through its governing board, may shall have
   16  the authority to sell or lease such hospital to a for-profit or
   17  not-for-profit Florida corporation, and enter into leases or
   18  other contracts with a for-profit or not-for-profit Florida
   19  corporation for the purpose of operating and managing such
   20  hospital and any or all of its facilities of whatsoever kind and
   21  nature. The term of any such lease, contract, or agreement and
   22  the conditions, covenants, and agreements to be contained
   23  therein shall be determined by the governing board of such
   24  county, district, or municipal hospital. The governing board of
   25  the hospital must find that the sale, lease, or contract is in
   26  the best interests of the public and must state the basis of
   27  such finding. The sale or lease of such hospital is subject to
   28  approval by a circuit court. If the governing board of a county,
   29  district, or municipal hospital decides to lease the hospital,
   30  it must give notice in accordance with paragraph (4)(a) or
   31  paragraph (4)(b).
   32         (4) If In the event the governing board of a county,
   33  district, or municipal hospital determines that it is no longer
   34  in the public interest to own or operate such hospital and
   35  elects to consider a sale or lease of the hospital to a third
   36  party, the governing board must first determine whether there
   37  are any qualified purchasers or lessees. In the process of
   38  evaluating any potential purchasers or lessees elects to sell or
   39  lease the hospital, the board shall:
   40         (a) Negotiate the terms of the sale or lease with a for
   41  profit or not-for-profit Florida corporation and Publicly
   42  advertise the meeting at which the proposed sale or lease will
   43  be considered by the governing board of the hospital in
   44  accordance with s. 286.0105; or
   45         (b) Publicly advertise the offer to accept proposals in
   46  accordance with s. 255.0525 and receive proposals from all
   47  interested and qualified purchasers and lessees.
   48  
   49  Any sale or lease must be for fair market value, and any sale or
   50  lease must comply with all applicable state and federal
   51  antitrust laws. For the purposes of this section, the term “fair
   52  market value” means the price that a seller is willing to accept
   53  and a buyer is willing to pay on the open market and in an arm’s
   54  length transaction.
   55         (5) A determination by a governing board to accept a
   56  proposal for sale or lease must state, in writing, the findings
   57  and basis for supporting the determination.
   58         (a) The findings must include, but need not be limited to,
   59  the governing board’s determination that the proposal:
   60         1. Represents fair market value.
   61         2. Affects whether there will be a reduction or elimination
   62  of ad valorem or other tax revenues to support the hospital.
   63         3. Ensures that quality health care will continue to be
   64  provided to all residents of the affected community,
   65  particularly to the indigent, the uninsured, and the
   66  underinsured.
   67         4. Is otherwise in compliance with paragraph (9)(a).
   68         (b) The findings must be accompanied by all information and
   69  documents relevant to the governing board’s determination,
   70  including, but not limited to:
   71         1. The names and addresses of all parties to the
   72  transaction.
   73         2. The location of the hospital and all related facilities.
   74         3. A description of the terms of all proposed agreements.
   75         4. A copy of the proposed sale or lease agreement and any
   76  related agreements, including, but not limited to, leases,
   77  management contracts, service contracts, and memoranda of
   78  understanding.
   79         5. The estimated total value associated with the proposed
   80  agreement and the proposed acquisition price and other
   81  consideration.
   82         6. Any valuations of the hospital’s assets prepared during
   83  the 3 years immediately preceding the proposed transaction date.
   84         7. Any financial or economic analysis and report from any
   85  expert or consultant retained by the governing board.
   86         8. A fairness evaluation by an independent expert in such
   87  transactions.
   88         9. Copies of all other proposals and bids the governing
   89  board may have received or considered in compliance with
   90  subsection (4).
   91         (6) Within 120 days before the anticipated closing date of
   92  the proposed transaction, the governing board shall make
   93  publicly available all findings and documents required under
   94  subsection (5) and publish a notice of the proposed transaction
   95  in one or more newspapers of general circulation in the county
   96  in which the majority of the physical assets of the hospital are
   97  located. The notice must include the names of the parties
   98  involved and the means by which a person may submit written
   99  comments about the proposed transaction to the governing board
  100  and may obtain copies of the findings and documents required
  101  under subsection (5).
  102         (7) Within 20 days after the date of publication of the
  103  public notice, any interested person may submit to the governing
  104  board a detailed written statement of opposition to the
  105  transaction. If a written statement of opposition has been
  106  submitted, the governing board or the proposed purchaser or
  107  lessee may submit a written response to the interested party
  108  within 10 days after the written statement of opposition due
  109  date.
  110         (8) A governing board of a county, district, or municipal
  111  hospital may not enter into a sale or lease of a hospital
  112  facility without first receiving approval from a circuit court.
  113         (a) The governing board shall file a petition in a circuit
  114  court seeking approval of the proposed transaction at least 30
  115  days after publication of the notice of the proposed
  116  transaction. The petition must be filed in the circuit in which
  117  the majority of the physical assets of the hospital are located.
  118         (b) The petition for approval filed by the governing board
  119  must include all findings and documents required under
  120  subsection (5) and certification by the governing board of
  121  compliance with all requirements of this section.
  122         (c) Circuit courts have jurisdiction to approve the sale or
  123  lease of a county, district, or municipal hospital.
  124         (9) Upon the filing of a petition for approval, the court
  125  shall issue an order requiring all interested parties to appear
  126  at a designated time and place within the circuit where the
  127  petition is filed and show why the petition should not be
  128  granted.
  129         (a) Before the date set for the hearing, the clerk shall
  130  publish a copy of the order in one or more newspapers of general
  131  circulation in the county in which the majority of the physical
  132  assets of the hospital are located at least once each week for 2
  133  consecutive weeks, commencing with the first publication, which
  134  must be at least 20 days before the date set for the hearing. By
  135  these publications, all interested parties are made parties
  136  defendant to the action and the court has jurisdiction of them
  137  to the same extent as if named as defendants in the petition and
  138  personally served with process.
  139         (b) Any interested person may become a party to the action
  140  by moving against or pleading to the petition at or before the
  141  time set for the hearing. At the hearing, the court shall
  142  determine all questions of law and fact and make such orders as
  143  will enable it to properly consider and determine the action and
  144  render a final judgment with the least possible delay.
  145         (10) Upon conclusion of all hearings and proceedings, the
  146  court shall render a final judgment approving or denying the
  147  proposed transaction. In reaching its final judgment, the court
  148  shall determine whether:
  149         (a) The proposed transaction is permitted by law.
  150         (b) The proposed transaction unreasonably excludes a
  151  potential purchaser or lessee on the basis of being a for-profit
  152  or a not-for-profit Florida corporation.
  153         (c) The governing board of the hospital publicly advertised
  154  the meeting at which the proposed transaction was considered by
  155  the board in compliance with s. 286.0105.
  156         (d) The governing board of the hospital publicly advertised
  157  the offer to accept proposals in compliance with s. 255.0525.
  158         (e) The governing board of the hospital exercised due
  159  diligence in deciding to dispose of hospital assets, selecting
  160  the proposed purchaser or lessee, and negotiating the terms and
  161  conditions of the disposition.
  162         (f) Any conflict of interest was disclosed, including, but
  163  not limited to, conflicts of interest relating to members of the
  164  governing board and experts retained by the parties to the
  165  transaction.
  166         (g) The seller or lessor will receive fair market value for
  167  the assets.
  168         (h) The acquiring entity has made an enforceable commitment
  169  to ensure that quality health care will continue to be provided
  170  to all residents of the affected community, in particular the
  171  indigent, the uninsured, and the underinsured.
  172         (i) The proposed transaction will result in a reduction or
  173  elimination of ad valorem or other taxes used to support the
  174  hospital.
  175         (11) Any party to the action has the right to seek judicial
  176  review in the appellate district where the petition for approval
  177  was filed.
  178         (a) All proceedings shall be instituted by filing a notice
  179  of appeal or petition for review in accordance with the Florida
  180  Rules of Appellate Procedure within 30 days after the date of
  181  final judgment.
  182         (b) In such judicial review, the reviewing court shall
  183  affirm the judgment of the circuit court, unless the decision is
  184  arbitrary, capricious, or not in compliance with this section.
  185         (12) All costs shall be paid by the governing board, unless
  186  an interested party contests the action, in which case the court
  187  may assign costs to the parties.
  188         (13) Any sale or lease completed before March 9, 2011, is
  189  not subject to this section. Any lease that contained, on March
  190  9, 2011, an option to renew or extend that lease upon its
  191  expiration is not subject to this section upon renewal or
  192  extension on or after March 9, 2011.
  193         Section 2. Section 395.3036, Florida Statutes, is amended
  194  to read:
  195         395.3036 Confidentiality of records and meetings of
  196  corporations that lease public hospitals or other public health
  197  care facilities.—The records of a private corporation that
  198  leases a public hospital or other public health care facility
  199  are confidential and exempt from the provisions of s. 119.07(1)
  200  and s. 24(a), Art. I of the State Constitution, and the meetings
  201  of the governing board of a private corporation are exempt from
  202  s. 286.011 and s. 24(b), Art. I of the State Constitution if
  203  when the public lessor complies with the public finance
  204  accountability provisions of s. 155.40(14) 155.40(5) with
  205  respect to the transfer of any public funds to the private
  206  lessee and if when the private lessee meets at least three of
  207  the five following criteria:
  208         (1) The public lessor that owns the public hospital or
  209  other public health care facility was not the incorporator of
  210  the private corporation that leases the public hospital or other
  211  health care facility.
  212         (2) The public lessor and the private lessee do not
  213  commingle any of their funds in any account maintained by either
  214  of them, other than the payment of the rent and administrative
  215  fees or the transfer of funds pursuant to subsection (5)(2).
  216         (3) Except as otherwise provided by law, the private lessee
  217  is not allowed to participate, except as a member of the public,
  218  in the decisionmaking process of the public lessor.
  219         (4) The lease agreement does not expressly require the
  220  lessee to comply with the requirements of ss. 119.07(1) and
  221  286.011.
  222         (5) The public lessor is not entitled to receive any
  223  revenues from the lessee, except for rental or administrative
  224  fees due under the lease, and the lessor is not responsible for
  225  the debts or other obligations of the lessee.
  226         Section 3. This act shall take effect January 1, 2012.
  227  
  228  ================= T I T L E  A M E N D M E N T ================
  229         And the title is amended as follows:
  230         Delete everything before the enacting clause
  231  and insert:
  232                        A bill to be entitled                      
  233         An act relating to the sale or lease of a county,
  234         district, or municipal hospital; amending s. 155.40,
  235         F.S.; providing that the sale or lease of a county,
  236         district, or municipal hospital is subject to circuit
  237         court approval; requiring the hospital governing board
  238         to determine by certain public advertisements whether
  239         there are qualified purchasers or lessees before the
  240         sale or lease of such hospital; defining the term
  241         “fair market value”; requiring the board to state in
  242         writing specified criteria forming the basis of its
  243         acceptance of a proposal for sale or lease of the
  244         hospital; providing for publication of notice;
  245         authorizing submission of written statements of
  246         opposition to a proposed transaction, and written
  247         responses thereto, within a certain timeframe;
  248         requiring the board to file a petition for approval
  249         with the circuit court and receive approval before any
  250         transaction is finalized; specifying information to be
  251         included in such petition; providing for the circuit
  252         court to issue an order requiring all interested
  253         parties to appear before the court under certain
  254         circumstances; requiring the clerk of the court to
  255         publish the copy of the order in certain newspapers at
  256         specified times; providing that certain parties are
  257         made parties defendant to the action by the
  258         publication of the order; granting the circuit court
  259         jurisdiction to approve sales or leases of county,
  260         district, or municipal hospitals based on specified
  261         criteria; providing for a party to seek judicial
  262         review; requiring that in judicial review the
  263         reviewing court affirm the judgment of the circuit
  264         court unless the decision is arbitrary, capricious, or
  265         not in compliance with the act; requiring the board to
  266         pay costs associated with the petition for approval
  267         unless a party contests the action; providing an
  268         exemption for certain sale or lease transactions
  269         completed before a specified date; amending s.
  270         395.3036, F.S.; conforming cross-references; providing
  271         an effective date.