Bill Text: FL S1448 | 2011 | Regular Session | Comm Sub

NOTE: There are more recent revisions of this legislation. Read Latest Draft

---

Bill Title: Sale/Lease/County, District, or Municipal Hospital

Spectrum: Slight Partisan Bill (Republican 4-2)

Status: (Introduced - Dead) 2011-05-07 - Indefinitely postponed and withdrawn from consideration [S1448 Detail]

Download: Florida-2011-S1448-Comm_Sub.html

---

       Florida Senate - 2011                             CS for SB 1448
       
       
       
       By the Committee on Community Affairs; and Senators Garcia and
       Lynn
       
       
       
       578-03770-11                                          20111448c1
    1                        A bill to be entitled                      
    2         An act relating to the sale or lease of a county,
    3         district, or municipal hospital; amending s. 155.40,
    4         F.S.; providing that the sale or lease of a county,
    5         district, or municipal hospital is subject to approval
    6         by the registered voters or by the circuit court;
    7         requiring the hospital governing board to determine by
    8         certain public advertisements whether there are
    9         qualified purchasers or lessees before the sale or
   10         lease of such hospital; defining the term “fair market
   11         value”; requiring the board to state in writing
   12         specified criteria forming the basis of its acceptance
   13         of a proposal for sale or lease of the hospital;
   14         providing for publication of notice; authorizing
   15         submission of written statements of opposition to a
   16         proposed transaction, and written responses thereto,
   17         within a certain timeframe; requiring the board to
   18         file a petition for approval with the circuit court
   19         and receive approval before any transaction is
   20         finalized; specifying information to be included in
   21         such petition; providing for the circuit court to
   22         issue an order requiring all interested parties to
   23         appear before the court under certain circumstances;
   24         requiring the clerk of the court to publish the copy
   25         of the order in certain newspapers at specified times;
   26         providing that certain parties are made parties
   27         defendant to the action by the publication of the
   28         order; granting the circuit court jurisdiction to
   29         approve sales or leases of county, district, or
   30         municipal hospitals based on specified criteria;
   31         providing for a party to seek judicial review;
   32         requiring that in judicial review the reviewing court
   33         affirm the judgment of the circuit court unless the
   34         decision is arbitrary, capricious, or not in
   35         compliance with the act; requiring the board to pay
   36         costs associated with the petition for approval unless
   37         a party contests the action; providing an exemption
   38         for certain sale or lease transactions completed
   39         before a specified date; amending s. 395.3036, F.S.;
   40         conforming cross-references; providing an effective
   41         date.
   42  
   43  Be It Enacted by the Legislature of the State of Florida:
   44  
   45         Section 1. Subsections (1) and (4) of section 155.40,
   46  Florida Statutes, are amended, subsections (5) through (8) are
   47  renumbered as subsections (14) through (17), respectively, and
   48  new subsections (5) through (13) are added to that section, to
   49  read:
   50         155.40 Sale or lease of county, district, or municipal
   51  hospital; effect of sale.—
   52         (1) In order for that citizens and residents of the state
   53  to may receive quality health care, any county, district, or
   54  municipal hospital organized and existing under the laws of this
   55  state, acting by and through its governing board, may shall have
   56  the authority to sell or lease such hospital to a for-profit or
   57  not-for-profit Florida corporation, and enter into leases or
   58  other contracts with a for-profit or not-for-profit Florida
   59  corporation for the purpose of operating and managing such
   60  hospital and any or all of its facilities of whatsoever kind and
   61  nature. The term of any such lease, contract, or agreement and
   62  the conditions, covenants, and agreements to be contained
   63  therein shall be determined by the governing board of such
   64  county, district, or municipal hospital. The governing board of
   65  the hospital must find that the sale, lease, or contract is in
   66  the best interests of the public and must state the basis of
   67  such finding. The sale or lease of such hospital is subject to
   68  approval by majority vote of the registered voters in the
   69  county, district, or municipality or, in the alternative,
   70  approval by a circuit court. If the governing board of a county,
   71  district, or municipal hospital decides to lease the hospital,
   72  it must give notice in accordance with paragraph (4)(a) or
   73  paragraph (4)(b).
   74         (4) If In the event the governing board of a county,
   75  district, or municipal hospital determines that it is no longer
   76  in the public interest to own or operate such hospital and
   77  elects to consider a sale or lease of the hospital to a third
   78  party, the governing board must first determine whether there
   79  are any qualified purchasers or lessees. In the process of
   80  evaluating any potential purchasers or lessees elects to sell or
   81  lease the hospital, the board shall:
   82         (a) Negotiate the terms of the sale or lease with a for
   83  profit or not-for-profit Florida corporation and Publicly
   84  advertise the meeting at which the proposed sale or lease will
   85  be considered by the governing board of the hospital in
   86  accordance with s. 286.0105; or
   87         (b) Publicly advertise the offer to accept proposals in
   88  accordance with s. 255.0525 and receive proposals from all
   89  interested and qualified purchasers and lessees.
   90  
   91  Any sale or lease must be for fair market value, and any sale or
   92  lease must comply with all applicable state and federal
   93  antitrust laws. For the purposes of this section, the term “fair
   94  market value” means the price that a seller is willing to accept
   95  and a buyer is willing to pay on the open market and in an arm’s
   96  length transaction.
   97         (5) A determination by a governing board to accept a
   98  proposal for sale or lease must state, in writing, the findings
   99  and basis for supporting the determination.
  100         (a) The findings must include, but need not be limited to,
  101  the governing board’s determination that the proposal:
  102         1. Represents fair market value.
  103         2. Affects whether there will be a reduction or elimination
  104  of ad valorem or other tax revenues to support the hospital.
  105         3. Ensures that quality health care will continue to be
  106  provided to all residents of the affected community,
  107  particularly to the indigent, the uninsured, and the
  108  underinsured.
  109         4. Is otherwise in compliance with paragraph (9)(a).
  110         (b) The findings must be accompanied by all information and
  111  documents relevant to the governing board’s determination,
  112  including, but not limited to:
  113         1. The names and addresses of all parties to the
  114  transaction.
  115         2. The location of the hospital and all related facilities.
  116         3. A description of the terms of all proposed agreements.
  117         4. A copy of the proposed sale or lease agreement and any
  118  related agreements, including, but not limited to, leases,
  119  management contracts, service contracts, and memoranda of
  120  understanding.
  121         5. The estimated total value associated with the proposed
  122  agreement and the proposed acquisition price and other
  123  consideration.
  124         6. Any valuations of the hospital’s assets prepared during
  125  the 3 years immediately preceding the proposed transaction date.
  126         7. Any financial or economic analysis and report from any
  127  expert or consultant retained by the governing board.
  128         8. A fairness evaluation by an independent expert in such
  129  transactions.
  130         9. Copies of all other proposals and bids the governing
  131  board may have received or considered in compliance with
  132  subsection (4).
  133         (6) Within 120 days before the anticipated closing date of
  134  the proposed transaction, the governing board shall make
  135  publicly available all findings and documents required under
  136  subsection (5) and publish a notice of the proposed transaction
  137  in one or more newspapers of general circulation in the county
  138  in which the majority of the physical assets of the hospital are
  139  located. The notice must include the names of the parties
  140  involved and the means by which a person may submit written
  141  comments about the proposed transaction to the governing board
  142  and may obtain copies of the findings and documents required
  143  under subsection (5).
  144         (7) Within 20 days after the date of publication of the
  145  public notice, any interested person may submit to the governing
  146  board a detailed written statement of opposition to the
  147  transaction. If a written statement of opposition has been
  148  submitted, the governing board or the proposed purchaser or
  149  lessee may submit a written response to the interested party
  150  within 10 days after the written statement of opposition due
  151  date.
  152         (8) A governing board of a county, district, or municipal
  153  hospital may not enter into a sale or lease of a hospital
  154  facility without first receiving approval by majority vote of
  155  the registered voters in the county, district, or municipality
  156  or, in the alternative, approval from a circuit court.
  157         (a) The governing board shall file a petition in a circuit
  158  court seeking approval of the proposed transaction at least 30
  159  days after publication of the notice of the proposed
  160  transaction. The petition must be filed in the circuit in which
  161  the majority of the physical assets of the hospital are located.
  162         (b) The petition for approval filed by the governing board
  163  must include all findings and documents required under
  164  subsection (5) and certification by the governing board of
  165  compliance with all requirements of this section.
  166         (c) Circuit courts have jurisdiction to approve the sale or
  167  lease of a county, district, or municipal hospital.
  168         (9) Upon the filing of a petition for approval, the court
  169  shall issue an order requiring all interested parties to appear
  170  at a designated time and place within the circuit where the
  171  petition is filed and show why the petition should not be
  172  granted.
  173         (a) Before the date set for the hearing, the clerk shall
  174  publish a copy of the order in one or more newspapers of general
  175  circulation in the county in which the majority of the physical
  176  assets of the hospital are located at least once each week for 2
  177  consecutive weeks, commencing with the first publication, which
  178  must be at least 20 days before the date set for the hearing. By
  179  these publications, all interested parties are made parties
  180  defendant to the action and the court has jurisdiction of them
  181  to the same extent as if named as defendants in the petition and
  182  personally served with process.
  183         (b) Any interested person may become a party to the action
  184  by moving against or pleading to the petition at or before the
  185  time set for the hearing. At the hearing, the court shall
  186  determine all questions of law and fact and make such orders as
  187  will enable it to properly consider and determine the action and
  188  render a final judgment with the least possible delay.
  189         (10) Upon conclusion of all hearings and proceedings, the
  190  court shall render a final judgment approving or denying the
  191  proposed transaction. In reaching its final judgment, the court
  192  shall determine whether:
  193         (a) The proposed transaction is permitted by law.
  194         (b) The proposed transaction unreasonably excludes a
  195  potential purchaser or lessee on the basis of being a for-profit
  196  or a not-for-profit Florida corporation.
  197         (c) The governing board of the hospital publicly advertised
  198  the meeting at which the proposed transaction was considered by
  199  the board in compliance with s. 286.0105.
  200         (d) The governing board of the hospital publicly advertised
  201  the offer to accept proposals in compliance with s. 255.0525.
  202         (e) The governing board of the hospital exercised due
  203  diligence in deciding to dispose of hospital assets, selecting
  204  the proposed purchaser or lessee, and negotiating the terms and
  205  conditions of the disposition.
  206         (f) Any conflict of interest was disclosed, including, but
  207  not limited to, conflicts of interest relating to members of the
  208  governing board and experts retained by the parties to the
  209  transaction.
  210         (g) The seller or lessor will receive fair market value for
  211  the assets.
  212         (h) The acquiring entity has made an enforceable commitment
  213  to ensure that quality health care will continue to be provided
  214  to all residents of the affected community, in particular the
  215  indigent, the uninsured, and the underinsured.
  216         (i) The proposed transaction will result in a reduction or
  217  elimination of ad valorem or other taxes used to support the
  218  hospital.
  219         (11) Any party to the action has the right to seek judicial
  220  review in the appellate district where the petition for approval
  221  was filed.
  222         (a) All proceedings shall be instituted by filing a notice
  223  of appeal or petition for review in accordance with the Florida
  224  Rules of Appellate Procedure within 30 days after the date of
  225  final judgment.
  226         (b) In such judicial review, the reviewing court shall
  227  affirm the judgment of the circuit court, unless the decision is
  228  arbitrary, capricious, or not in compliance with this section.
  229         (12) All costs shall be paid by the governing board, unless
  230  an interested party contests the action, in which case the court
  231  may assign costs to the parties.
  232         (13) Any sale or lease completed before March 9, 2011, is
  233  not subject to this section. Any lease that contained, on March
  234  9, 2011, an option to renew or extend that lease upon its
  235  expiration is not subject to this section upon renewal or
  236  extension on or after March 9, 2011.
  237         Section 2. Section 395.3036, Florida Statutes, is amended
  238  to read:
  239         395.3036 Confidentiality of records and meetings of
  240  corporations that lease public hospitals or other public health
  241  care facilities.—The records of a private corporation that
  242  leases a public hospital or other public health care facility
  243  are confidential and exempt from the provisions of s. 119.07(1)
  244  and s. 24(a), Art. I of the State Constitution, and the meetings
  245  of the governing board of a private corporation are exempt from
  246  s. 286.011 and s. 24(b), Art. I of the State Constitution if
  247  when the public lessor complies with the public finance
  248  accountability provisions of s. 155.40(14) 155.40(5) with
  249  respect to the transfer of any public funds to the private
  250  lessee and if when the private lessee meets at least three of
  251  the five following criteria:
  252         (1) The public lessor that owns the public hospital or
  253  other public health care facility was not the incorporator of
  254  the private corporation that leases the public hospital or other
  255  health care facility.
  256         (2) The public lessor and the private lessee do not
  257  commingle any of their funds in any account maintained by either
  258  of them, other than the payment of the rent and administrative
  259  fees or the transfer of funds pursuant to subsection (5)(2).
  260         (3) Except as otherwise provided by law, the private lessee
  261  is not allowed to participate, except as a member of the public,
  262  in the decisionmaking process of the public lessor.
  263         (4) The lease agreement does not expressly require the
  264  lessee to comply with the requirements of ss. 119.07(1) and
  265  286.011.
  266         (5) The public lessor is not entitled to receive any
  267  revenues from the lessee, except for rental or administrative
  268  fees due under the lease, and the lessor is not responsible for
  269  the debts or other obligations of the lessee.
  270         Section 3. This act shall take effect January 1, 2012.