Senate Bill sb1190c1

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    Florida Senate - 2006                           CS for SB 1190

    By the Committee on Community Affairs; and Senator Atwater





    578-2369-06

  1                      A bill to be entitled

  2         An act relating to the sale or lease of a

  3         county, district, or municipal hospital;

  4         amending s. 155.40, F.S.; providing for the

  5         effect of the sale of a public hospital to a

  6         private purchaser; providing that the purchaser

  7         of a public hospital is not acting on behalf of

  8         the public entity seller and is not an agency

  9         within the meaning of ch. 119, F.S., unless the

10         sale document expressly provides to the

11         contrary; providing an effective date.

12  

13  Be It Enacted by the Legislature of the State of Florida:

14  

15         Section 1.  Section 155.40, Florida Statutes, is

16  amended to read:

17         155.40  Sale or lease of county, district, or municipal

18  hospital; effect of sale.--

19         (1)  In order that citizens and residents of the state

20  may receive quality health care, any county, district, or

21  municipal hospital organized and existing under the laws of

22  this state, acting by and through its governing board, shall

23  have the authority to sell or lease such hospital to a

24  for-profit or not-for-profit Florida corporation, and enter

25  into leases or other contracts with a for-profit or

26  not-for-profit Florida corporation for the purpose of

27  operating and managing such hospital and any or all of its

28  facilities of whatsoever kind and nature.  The term of any

29  such lease, contract, or agreement and the conditions,

30  covenants, and agreements to be contained therein shall be

31  determined by the governing board of such county, district, or

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    Florida Senate - 2006                           CS for SB 1190
    578-2369-06




 1  municipal hospital. The governing board of the hospital must

 2  find that the sale, lease, or contract is in the best

 3  interests of the public and must state the basis of such

 4  finding. If the governing board of a county, district, or

 5  municipal hospital decides to lease the hospital, it must give

 6  notice in accordance with paragraph (4)(a) or paragraph

 7  (4)(b).

 8         (2)  Any such lease, contract, or agreement made

 9  pursuant hereto shall:

10         (a)  Provide that the articles of incorporation of such

11  for-profit or not-for-profit corporation be subject to the

12  approval of the board of directors or board of trustees of

13  such hospital;

14         (b)  Require that any not-for-profit corporation become

15  qualified under s. 501(c)(3) of the United States Internal

16  Revenue Code;

17         (c)  Provide for the orderly transition of the

18  operation and management of such facilities;

19         (d)  Provide for the return of such facility to the

20  county, municipality, or district upon the termination of such

21  lease, contract, or agreement; and

22         (e)  Provide for the continued treatment of indigent

23  patients pursuant to the Florida Health Care Responsibility

24  Act and pursuant to chapter 87-92, Laws of Florida.

25         (3)  Any sale, lease, or contract entered into pursuant

26  to this section prior to the effective date of this act must

27  have complied with the requirements of subsection (2) in

28  effect at the time of the sale, lease, or contract.  It is the

29  intent of the Legislature that this section does not impose

30  any further requirements with respect to the formation of any

31  for-profit or not-for-profit Florida corporation, the

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    Florida Senate - 2006                           CS for SB 1190
    578-2369-06




 1  composition of the board of directors of any Florida

 2  corporation, or the manner in which control of the hospital is

 3  transferred to the Florida corporation.

 4         (4)  In the event the governing board of a county,

 5  district, or municipal hospital elects to sell or lease the

 6  hospital, the board shall:

 7         (a)  Negotiate the terms of the sale or lease with a

 8  for-profit or not-for-profit Florida corporation and publicly

 9  advertise the meeting at which the proposed sale or lease will

10  be considered by the governing board of the hospital in

11  accordance with s. 286.0105; or

12         (b)  Publicly advertise the offer to accept proposals

13  in accordance with s. 255.0525 and receive proposals from all

14  interested and qualified purchasers.

15  

16  Any sale must be for fair market value, and any sale or lease

17  must comply with all applicable state and federal antitrust

18  laws.

19         (5)  In the event a hospital operated by a for-profit

20  or not-for-profit Florida corporation receives annually more

21  than $100,000 in revenues from the county, district, or

22  municipality that owns the hospital, the Florida corporation

23  must be accountable to the county, district, or municipality

24  with respect to the manner in which the funds are expended by

25  either:

26         (a)  Having the revenues subject to annual

27  appropriations by the county, district, or municipality; or

28         (b)  Where there is a contract to provide revenues to

29  the hospital, the term of which is longer than 12 months, the

30  governing board of the county, district, or municipality must

31  

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    Florida Senate - 2006                           CS for SB 1190
    578-2369-06




 1  be able to modify the contract upon 12 months notice to the

 2  hospital.

 3  

 4  A not-for-profit corporation that is subject to this

 5  subsection and that does not currently comply with the

 6  accountability requirements in this subsection shall have 12

 7  months after the effective date of this act to modify any

 8  contracts with the county, district, or municipality in a

 9  manner that is consistent with this subsection.

10         (6)  Unless otherwise expressly stated in the lease

11  documents, the transaction involving the sale or lease of a

12  hospital shall not be construed as:

13         (a)  A transfer of a governmental function from the

14  county, district, or municipality to the private purchaser or

15  lessee;

16         (b)  Constituting a financial interest of the public

17  lessor in the private lessee; or

18         (c)  Making a private lessee an integral part of the

19  public lessor's decisionmaking process.

20         (7)  The lessee of a hospital, under pursuant to this

21  section or any special act of the Legislature, operating under

22  a lease is shall not be construed to be "acting on behalf of"

23  the lessor as that term is used in statute, unless the lease

24  document expressly provides to the contrary.

25         (8)  Unless otherwise expressly stated in the sale

26  documents, the transaction involving the sale of a hospital

27  shall not be construed as:

28         (a)  A transfer of a governmental function from the

29  county, district, or municipality to the private purchaser;

30         (b)  Constituting a financial interest of the public

31  seller in the private purchaser; or

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    Florida Senate - 2006                           CS for SB 1190
    578-2369-06




 1         (c)  Making a private purchaser an integral part of the

 2  public seller's decisionmaking process.

 3         (9)(a)  The purchaser of a hospital, under this section

 4  or any special act of the Legislature, operating after a sale

 5  of the hospital is not "acting on behalf of" the seller as

 6  that term is used in statute, unless the sale document

 7  expressly provides to the contrary.

 8         (b)  The purchaser of a hospital, under this section or

 9  any special act of the Legislature, operating after a sale of

10  the hospital shall not be construed as an "agency" within the

11  meaning of s. 119.011(2), unless the sale document expressly

12  provides to the contrary.

13         Section 2.  This act shall take effect July 1, 2006.

14  

15          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
16                         Senate Bill 1190

17                                 

18  The committee substitute (CS) revises provisions relating to
    the sale of a public hospital to a private party to provide
19  that, unless expressly stated in the sale documents, the sale
    of the hospital shall not be construed as: a transfer of a
20  governmental function from the county, district, or
    municipality to the private purchaser; constituting a
21  financial interest of the public seller in the private
    purchaser, or making a private purchaser an integral part of
22  the public seller's decision-making process. Under this CS, a
    purchaser, operating after the sale of a hospital, is not
23  "acting on behalf of" the seller and is not an agency within
    the meaning of that term as used in ch. 119, F.S., the Public
24  Records Law, unless the sale document expressly provides to
    the contrary.
25  
    The CS deletes language that revised subsection (7) of s.
26  155.40, F.S., to specify that a purchaser of a public hospital
    shall not be construed to be "acting on behalf of" the lessor
27  unless the lease document expressly provides to the contrary.
    It also deletes language that provided that the purchaser of a
28  hospital, pursuant to s. 155.40, F.S., or any special act of
    the Legislature, may not be construed to be "acting on behalf
29  of" the seller as that term is used in statute, unless the
    purchase document expressly provides to the contrary.
30  

31  

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