THE ATTORNEY GENERAL 

OF TEXAS 

February 23, 1988 

C 

Honorabl'e Ashley Smith Opinion No. JR-864 

Chairman 

Government Organization Re: 

Committee 

Authority of Amarillo 

Hospital District to disTexas House of Representatives pose of Northwest Texas 

P. 0. Box 2910 Hospital (RQ-1277) 

Austin, Texas 78769 

Dear Representative Smith: 

You ask several questions pertaining to the City of 

Amarillo Hospital District (AHD). The AHD was authorized 

by article IX, section 5, of the Texas Constitution and 

created by Acts 1957, 55th Leg., ch. 136, at 298. Because 

the creating statute predated the effective date of the 

~constitutional amendment authorizing the district, the 

legislature Walidatedql the enabling statute by 

House Bill No. 

enacting 

70 by Acts 1959, 56th Leg., ch. 32, at 59. 

House Bill No. 70 was essentially a reenactment of the 

earlier statute with a few amendments. 

The boundaries of the AHD are coextensive with the 

boundaries of the city of Amarillo. Tex . Const. art. IX, 

95(a). The constitutional provision as originally adopted 

authorized the legislature to permit Potter County to levy 

a tax in that portion of the county outside the city 

limits of Amarillo to render financial aid to the district. Art. IX, 55(b). A similar provision relating to 

Randall County was added to the constitution in 1987. 

Art. IX, 55(e). Thus, Potter and Randall County residents 

who are not residents of a hospital district may be served 

by the AHD.~ Acts 1957, 55th Leg., ch. 136, 516, at 304, 

as amended by Acts 1959, 56th Leg., ch. 32, 516, at 66 and 

Acts 1987, 70th Leg., 2nd C.S., ch. 71, 54, at 454. 

1. Randall County has not yet held an election on 

the question of participating in the AHD. 

P. 4188 
Honorable Ashley Smith - Page 2 (JM-864) 

We restate your questions as follows: 

1. Does the AHD board of managers or the 

Amarillo City Commission own and operate the 

Northwest Texas Hospital? 

2. Who has final authority to sell, 

lease, or close the hospital? Which entity, 

the hospital district board or the Amarillo 

City Commission, must determine that the 

sale, lease, or closure of the hospital 

is in the best interest of the district's 

residents? 

3. Is an election required to approve 

the sale or lease of the Northwest Texas 

Hospital to another entity? 

4. If the hospital is sold, leased, or 

closed, what is the hospital district's 

responsibility to the persons it serves? 

The AHD operates the Northwest Texas Hospital. Confusion about the authority of the board of managers of 

the hospital district may stem from the fact that the 

governing body of the city of Amarillo also has statutory 

responsibilities in relation to this hospital district. 

The district's enabling legislation provides in pertinent 

part: 

Sec. 1. The City of Amarillo, Texas, may 

be constituted a Hospital District . . . for 

the nurnose of ownina and oneratina a hospital or hOsnita1 svstem for indiaent and 

need!? nersons. . . . 

. . . . 

Sec. 4. a. Any lands, buildinas or eouinment that may be jointly or separately owned 

by the City of Amarillo and the County of 

Potter, within the hospital district, and by 

which medical services or hospital care are 

furnished to the indiaent . . . shall become 

the nrooertv of the HosDital District: and 

title thereto shall vest in the HOSDital 

District. . . , 

Sec. 5. a. The aovernina bodv of the Citv 

of Amarillo shall annoint a Board of HOSDital 

P. 4189 
Honorable Ashley Smith - Page 3 (JM-864) 

Manaaers . whose duties shall be to 

manaae. control and administer the hosnital 

gr hosDita1 sv tem of the HOSDital District. . . . T:e Board is authorized to 

promula t rules and reculations for the 

0Dera tiEne of the hOSDita1 or hosoital 

svstem. . . . 

Sec. 6. The governing body of the City of 

Amarillo shall have the power to prescribe 

the method and manner of making purchases and 

expenditures by and for such Hospital District . . . or may delegate any or all such 

powers to the Board of Managers. . . . 

. . . . 

Sec. 9. a. The Hospital District . . . 

shall have the right and power of. eminent 

domain. . . . 

b. The HOSDital District shall have the 

power to take by purchase or lease lands 

within or without the district as may be 

required for its purpose: and it mav sell or 

lease anv lands owned bv it at DUblic r 

private sale: nrovided. h wever. that io 

real estate mav be sold zr leased until 

titer there h s been a determination bv the 

aovernina bodt of the Citv of Amarillo that 

either the lands are 1 a r reouired f 

the nurnoses of the %.t% or that t:E 

arantee or lessee will use the DroDertv for 

hOSDita1 nurnoses or ourDOses incidental and 

JIecessarv to hosDita1 DurDoses. (Emphasis 

added.) 

Acts 1957, 55th Leg., ch. 136 as amended by Acts 1959, 

56th Leg., ch. 32. 

In answer to your first question, it is clear from 

the language quoted above in sections 4, 5, and 9 that the 

hospital district owns Northwest Texas Hospital and that 

the board of managers operates the facility. 

Next you ask about the authority to sell, lease, or 

close the hospital. Section 9(b) of the district's 

enabling statute quoted above addresses the sale of m. 

However, article 4437c-2, V.T.C.S., is a later enactment 

of the legislature that is specifically concerned with the 

p. 4190 
Honorable Ashley Smith - Page 4 (JM-864) 

sale, lease, or closure of hospitals. In our opinion, 

this article answers your second and third questions. The 

statute provides in pertinent part: 

Section 1. In this Act, 'official action' 

means . . . a resolution adopted by the 

governing body of a hospital district. 

Section 2. (a) The governing body of 

. . . a hospital district by official action 

may order the sale, lease, or closure of all 

or any part of, including real property, a 

hospital owned and operated by the political 

subdivision. The official action must 

include a finding by the governing body that 

the sale, lease, or closure is in the best 

interest of the residents of the political 

subdivision. 

. . . . 

(c) The sale or closure of a hospital is 

contingent on the right of the voters by 

petition to require a referendum on the 

issue. The sale or closure may not take 

effect sooner than the expiration of the time 

for a petition to be filed under Section 3 of 

this Act and, if a valid petition is filed, 

the sale or closure is contingent on voter 

approval. 

. . . . 

Section 3. (a) If before the 31st day 

after the date on which the governing body 

orders that a hospital be sold or closed the 

governing body receives a petition signed by 

at least 10 percent of the qualified voters 

of the political subdivision requesting an 

election on the question, the governing body 

.shall order and conduct an election. 

(b) . . . If a majority of the qualified 

voters voting on the question approve the 

sale or closure, the hospital may be sold or 

closed. 

V.T.C.S. art. 4437c-2. 

P. 4191 
Honorable Ashley Smith - Page 5 (JM-864) 

Pursuant to article 4437c-2, V.T.C.S., the board of 

managers of the hospital district has authority to sell, 

lease, or close the Northwest Texas Hospital after the 

board determines that such action is in the best interest 

of the district's residents. 

Article 4437c-2, V.T.C.S., does not give the city of 

Amarillo's governing body any authority to participate in 

a decision by the hospital district's board of managers to 

sell, lease, or close its hospital facility. If the 

proposed action .is a sale or closure of the facility, the 

voters may petition for an election on the issue of 

approving or disapproving the proposed sale or closure. 

An election is not required unless the petition reguirements of article 4437c-2, V.T.C.S., are satisfied. See 

Jackson Countv Hosrdtal District v. Jackson County 

Citizens For Continued HOSDital Care, 669 S.W.2d 147 (Tex. 

APP. - Corpus Christi 1984, no writ). 

Finally, you ask about the hospital district's responsibility to the persons it serves if the Northwest 

Texas Hospital is sold, leased, or closed. The constitutional provision and statute governing the AHD require the 

district to provide medical care to the needy inhabitants 

of the district and to residents of Potter County who 

are outside the district's boundaries. Tex. Const. art. 

IX, 55; Acts 1957, 55th Leg., ch. 136, as amended. If 

apprpved by the voters of Randall County, the district 

will also be responsible for the care of Randall County 

residents who do not reside in a hospital district. 

Pursuant to the Indigent Health Care and Treatment 

Act (article 4438f, V.T.C.S.) a hospital district has a 

mandatory duty to provide the health care services 

required under the Texas Constitution and the statute 

creating the district. V.T.C.S. art. 4438f, 511.02. In 

accordance with section 11.03 of the Indigent Health Care 

and Treatment Act, a hospital district may arrange to 

provide health care services through other public 

facilities, by contracting with a private provider, or 

through the purchase of insurance for eligible residents. 

The district may also affiliate with other public 

hospitals, hospital districts or governmental entities to 

provide regional administration and delivery of health 

care services. &S Attorney General Opinion JM-858 

(1988). 

Regardless of the method chosen by the hospital 

district to provide services to its eligible recipients, 

the district is liable for the health care services as 

P. 4192 
Honorable Ashley Smith - Page 6 (JM-864) 

provided by the constitution and its statute. V.T.C.S. 

art. 4438f, 512.01(b). Thus, the sale, closure, or lease 

of the Northwest Texas Hospital will have no effect on the - 

legal responsibility that the AHD has towards the persons 

it serves. 

SUMMARY 

The City of Amarillo Hospital District 

owns the Northwest Texas Hospital. The board 

of managers of the hospital district operates 

.the facility. 

Pursuant to article 4437c-2, V.T.C.S., 

the hospital district's board of managers may 

sell, lease, or close a hospital after a 

finding that such action is in the best 

interest of the district's residents. The 

voters of the district may petition for an 

election on the issue of selling or closing a 

hospital. 

If the Northwest Texas Hospital is sold, 

leased, or closed, the City of Amarillo 

Hospital District continues to be legally 

responsible for providing medical care 

pursuant to the Indigent Health Care and 

Treatment Act. 

Very truly yo , Ll /L htJ% 

JIM MATTOX 

Attorney General of Texas 

MARY KELLER 

First Assistant Attorney General 

LOU MCCREARY 

Executive Assistant Attorney General 

JUDGE ZOLLIE STEAKLEY 

Special Assistant Attorney General 

RICK GILPIN 

Chairman, Opinion Committee 

Prepared by Karen C. Gladney 

Assistant Attorney General 

,-. 

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