Bill Text: FL S0464 | 2012 | Regular Session | Introduced


Bill Title: Sale or Lease of a County, District, or Municipal Hospital

Spectrum: Partisan Bill (Republican 1-0)

Status: (Failed) 2012-03-09 - Died in Health Regulation, companion bill(s) passed, see CS/CS/CS/HB 711 (Ch. [S0464 Detail]

Download: Florida-2012-S0464-Introduced.html
       Florida Senate - 2012                                     SB 464
       
       
       
       By Senator Garcia
       
       
       
       
       40-00447-12                                            2012464__
    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 to the
   27         action by the publication of the order; granting the
   28         circuit court jurisdiction to approve the sale or
   29         lease of a county, district, or municipal hospital
   30         based on specified criteria; providing for a party to
   31         seek judicial review; requiring that the reviewing
   32         court affirm the judgment of the circuit court unless
   33         the decision is arbitrary, capricious, or not in
   34         compliance with the act; requiring the board to pay
   35         costs associated with the petition for approval unless
   36         a party contests the action; providing an exemption
   37         for certain sale or lease transactions completed
   38         before a specified date; amending s. 395.3036, F.S.;
   39         conforming cross-references; providing an effective
   40         date.
   41  
   42  Be It Enacted by the Legislature of the State of Florida:
   43  
   44         Section 1. Subsections (1) and (4) of section 155.40,
   45  Florida Statutes, are amended, present subsections (5) through
   46  (8) of that section are renumbered as subsections (14) through
   47  (17), respectively, and new subsections (5) through (13) are
   48  added to that section, to read:
   49         155.40 Sale or lease of county, district, or municipal
   50  hospital; effect of sale.—
   51         (1) In order for that citizens and residents of the state
   52  to may receive quality health care, any county, district, or
   53  municipal hospital organized and existing under the laws of this
   54  state, acting by and through its governing board, may shall have
   55  the authority to sell or lease such hospital to a for-profit or
   56  not-for-profit Florida corporation, and enter into leases or
   57  other contracts with a for-profit or not-for-profit Florida
   58  corporation for the purpose of operating and managing such
   59  hospital and any or all of its facilities of whatsoever kind and
   60  nature. The term of any such lease, contract, or agreement and
   61  the conditions, covenants, and agreements to be contained
   62  therein shall be determined by the governing board of such
   63  county, district, or municipal hospital. The governing board of
   64  the hospital must find that the sale, lease, or contract is in
   65  the best interests of the public and must state the basis of
   66  such finding. The sale or lease of such hospital is subject to
   67  approval by a majority vote of the registered voters in the
   68  county, district, or municipality or, in the alternative,
   69  approval by a circuit court. If the governing board of a county,
   70  district, or municipal hospital decides to lease the hospital,
   71  it must give notice in accordance with paragraph (4)(a) or
   72  paragraph (4)(b).
   73         (4) If In the event the governing board of a county,
   74  district, or municipal hospital determines that it is no longer
   75  in the public interest to own or operate such hospital and
   76  elects to consider a sale or lease of the hospital to a third
   77  party, the governing board must first determine whether there
   78  are any qualified purchasers or lessees. In the process of
   79  evaluating any potential purchasers or lessees elects to sell or
   80  lease the hospital, the board shall:
   81         (a) Negotiate the terms of the sale or lease with a for
   82  profit or not-for-profit Florida corporation and Publicly
   83  advertise the meeting at which the proposed sale or lease will
   84  be considered by the governing board of the hospital in
   85  accordance with s. 286.0105; or
   86         (b) Publicly advertise the offer to accept proposals in
   87  accordance with s. 255.0525 and receive proposals from all
   88  interested and qualified purchasers and lessees.
   89  
   90  Any sale or lease must be for fair market value, and any sale or
   91  lease must comply with all applicable state and federal
   92  antitrust laws. For the purposes of this section, the term “fair
   93  market value” means the price that a seller is willing to accept
   94  and a buyer is willing to pay on the open market and in an arms
   95  length transaction.
   96         (5) A determination by a governing board to accept a
   97  proposal for sale or lease must state, in writing, the findings
   98  and basis for supporting the determination.
   99         (a) The findings and basis for supporting the governing
  100  board’s determination must include, but need not be limited to,
  101  a balanced consideration of the following factors:
  102         1. The proposal represents fair market value, or if the
  103  proposal does not represent fair market value, a detailed
  104  explanation of why the public interest is served by the
  105  acceptance of less than fair market value.
  106         2. Whether the proposal will result in a reduction or
  107  elimination of ad valorem or other tax revenues to support the
  108  hospital.
  109         3. Whether the proposal includes an enforceable commitment
  110  that existing programs and services and quality health care will
  111  continue to be provided to all residents of the affected
  112  community, particularly to the indigent, the uninsured, and the
  113  underinsured.
  114         4.Whether the proposal is otherwise in compliance with
  115  subsections (6) and (7).
  116         (b) The findings must be accompanied by all information and
  117  documents relevant to the governing board’s determination,
  118  including, but not limited to:
  119         1. The names and addresses of all parties to the
  120  transaction.
  121         2. The location of the hospital and all related facilities.
  122         3. A description of the terms of all proposed agreements.
  123         4. A copy of the proposed sale or lease agreement and any
  124  related agreements, including, but not limited to, leases,
  125  management contracts, service contracts, and memoranda of
  126  understanding.
  127         5. The estimated total value associated with the proposed
  128  agreement and the proposed acquisition price and other
  129  consideration.
  130         6. Any valuations of the hospital’s assets prepared during
  131  the 3 years immediately preceding the proposed transaction date.
  132         7. Any financial or economic analysis and report from any
  133  expert or consultant retained by the governing board.
  134         8. A fairness evaluation by an independent expert in such
  135  transactions.
  136         9. Copies of all other proposals and bids the governing
  137  board may have received or considered in compliance with
  138  subsection (4).
  139         (6) Within 120 days before the anticipated closing date of
  140  the proposed transaction, the governing board shall make
  141  publicly available all findings and documents required under
  142  subsection (5) and publish a notice of the proposed transaction
  143  in one or more newspapers of general circulation in the county
  144  in which the majority of the physical assets of the hospital are
  145  located. The notice must include the names of the parties
  146  involved and the means by which a person may submit written
  147  comments about the proposed transaction to the governing board
  148  and obtain copies of the findings and documents required under
  149  subsection (5).
  150         (7) Within 20 days after the date of publication of the
  151  public notice, any interested person may submit to the governing
  152  board a detailed written statement of opposition to the
  153  transaction. If a written statement of opposition has been
  154  submitted, the governing board or the proposed purchaser or
  155  lessee may submit a written response to the interested party
  156  within 10 days after the written statement of opposition due
  157  date.
  158         (8) A governing board of a county, district, or municipal
  159  hospital may not enter into a sale or lease of a hospital
  160  facility without first receiving approval by a majority vote of
  161  the registered voters in the county, district, or municipality
  162  or, in the alternative, approval from a circuit court.
  163         (a) The governing board shall file a petition in a circuit
  164  court seeking approval of the proposed transaction at least 30
  165  days after publication of the notice of the proposed
  166  transaction. The petition must be filed in the circuit in which
  167  the majority of the physical assets of the hospital are located.
  168         (b) The petition for approval filed by the governing board
  169  must include all findings and documents required under
  170  subsection (5) and certification by the governing board of
  171  compliance with all requirements of this section.
  172         (c) A circuit court has jurisdiction to approve the sale or
  173  lease of a county, district, or municipal hospital.
  174         (9) Upon the filing of a petition for approval, the court
  175  shall issue an order requiring all interested parties to appear
  176  at a designated time and place within the circuit where the
  177  petition is filed and show why the petition should not be
  178  granted. For purposes of this subsection, the term “interested
  179  parties” includes any party submitting a proposal for sale or
  180  lease of the county, district, or municipal hospital, as well as
  181  the governing board.
  182         (a) Before the date set for the hearing, the clerk shall
  183  publish a copy of the order in one or more newspapers of general
  184  circulation in the county in which the majority of the physical
  185  assets of the hospital are located at least once each week for 2
  186  consecutive weeks, commencing with the first publication, which
  187  must be at least 20 days before the date set for the hearing. By
  188  these publications, all interested parties are made parties
  189  defendant to the action and the court has jurisdiction of them
  190  to the same extent as if named as defendants in the petition and
  191  personally served with process.
  192         (b) Any interested person may become a party to the action
  193  by moving against or pleading to the petition at or before the
  194  time set for the hearing. At the hearing, the court shall
  195  determine all questions of law and fact and make such orders as
  196  will enable it to properly consider and determine the action and
  197  render a final judgment with the least possible delay.
  198         (10) Upon conclusion of all hearings and proceedings, and
  199  upon consideration of all evidence presented, the court shall
  200  render a final judgment approving or denying the proposed
  201  transaction and shall order the governing board to accept or
  202  reject the proposal for the sale or lease of the county,
  203  district, or municipal hospital. In reaching its final judgment,
  204  the court shall determine whether:
  205         (a) The proposed transaction is permitted by law.
  206         (b) The proposed transaction unreasonably excludes a
  207  potential purchaser or lessee on the basis of being a for-profit
  208  or a not-for-profit Florida corporation.
  209         (c) The governing board of the hospital publicly advertised
  210  the meeting at which the proposed transaction was considered by
  211  the board in compliance with s. 286.0105.
  212         (d) The governing board of the hospital publicly advertised
  213  the offer to accept proposals in compliance with s. 255.0525.
  214         (e) The governing board of the hospital exercised due
  215  diligence in deciding to dispose of hospital assets, selecting
  216  the proposed purchaser or lessee, and negotiating the terms and
  217  conditions of the disposition.
  218         (f) Any conflict of interest was disclosed, including, but
  219  not limited to, conflicts of interest relating to members of the
  220  governing board and experts retained by the parties to the
  221  transaction.
  222         (g) The seller or lessor will receive fair market value for
  223  the assets, or if the sale or lease represents less than fair
  224  market value, why the public interest will be served by
  225  accepting less than fair market value.
  226         (h) The acquiring entity has made an enforceable commitment
  227  that existing programs and services and quality health care will
  228  continue to be provided to all residents of the affected
  229  community, particularly to the indigent, the uninsured, and the
  230  underinsured.
  231         (i) The proposed transaction will result in a reduction or
  232  elimination of ad valorem or other taxes used to support the
  233  hospital.
  234         (11) Any party to the action has the right to seek judicial
  235  review in the appellate district where the petition for approval
  236  was filed.
  237         (a) All proceedings shall be instituted by filing a notice
  238  of appeal or petition for review in accordance with the Florida
  239  Rules of Appellate Procedure within 30 days after the date of
  240  final judgment.
  241         (b) In such judicial review, the reviewing court shall
  242  affirm the judgment of the circuit court, unless the decision is
  243  arbitrary, capricious, or not in compliance with this section.
  244         (12) All costs shall be paid by the governing board, unless
  245  an interested party contests the action, in which case the court
  246  may assign costs to the parties.
  247         (13) Any sale or lease completed before March 9, 2011, is
  248  not subject to this section. Any lease that contained, on March
  249  9, 2011, an option to renew or extend that lease upon its
  250  expiration is not subject to this section upon renewal or
  251  extension on or after March 9, 2011.
  252         Section 2. Section 395.3036, Florida Statutes, is amended
  253  to read:
  254         395.3036 Confidentiality of records and meetings of
  255  corporations that lease public hospitals or other public health
  256  care facilities.—The records of a private corporation that
  257  leases a public hospital or other public health care facility
  258  are confidential and exempt from the provisions of s. 119.07(1)
  259  and s. 24(a), Art. I of the State Constitution, and the meetings
  260  of the governing board of a private corporation are exempt from
  261  s. 286.011 and s. 24(b), Art. I of the State Constitution if
  262  when the public lessor complies with the public finance
  263  accountability provisions of s. 155.40(14) 155.40(5) with
  264  respect to the transfer of any public funds to the private
  265  lessee and if when the private lessee meets at least three of
  266  the five following criteria:
  267         (1) The public lessor that owns the public hospital or
  268  other public health care facility was not the incorporator of
  269  the private corporation that leases the public hospital or other
  270  health care facility.
  271         (2) The public lessor and the private lessee do not
  272  commingle any of their funds in any account maintained by either
  273  of them, other than the payment of the rent and administrative
  274  fees or the transfer of funds pursuant to subsection (5)(2).
  275         (3) Except as otherwise provided by law, the private lessee
  276  is not allowed to participate, except as a member of the public,
  277  in the decisionmaking process of the public lessor.
  278         (4) The lease agreement does not expressly require the
  279  lessee to comply with the requirements of ss. 119.07(1) and
  280  286.011.
  281         (5) The public lessor is not entitled to receive any
  282  revenues from the lessee, except for rental or administrative
  283  fees due under the lease, and the lessor is not responsible for
  284  the debts or other obligations of the lessee.
  285         Section 3. This act shall take effect July 1, 2012.

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