Part 7.2. Health Facilities Financing Authority Act of California Government Code >> Division 3. >> Title 2. >> Part 7.2.
This part shall be known and may be cited as the California
Health Facilities Financing Authority Act.
The California Health Facilities Authority is continued in
state government as the California Health Facilities Financing
Authority. The authority constitutes a public instrumentality, and
the exercise by the authority of the powers conferred by this part
shall be deemed and held to be the performance of an essential public
function.
As used in this part, the following words and terms shall
have the following meanings, unless the context clearly indicates or
requires another or different meaning or intent:
(a) "Act" means the California Health Facilities Financing
Authority Act.
(b) "Authority" means the California Health Facilities Financing
Authority created by this part or any board, body, commission,
department, or officer succeeding to the principal functions thereof
or to which the powers conferred upon the authority by this part
shall be given by law.
(c) "Cost," as applied to a project or portion of a project
financed under this part, means and includes all or any part of the
cost of construction and acquisition of all lands, structures, real
or personal property, rights, rights-of-way, franchises, easements,
and interests acquired or used for a project, the cost of demolishing
or removing any buildings or structures on land so acquired,
including the cost of acquiring any lands to which those buildings or
structures may be moved, the cost of all machinery and equipment,
financing charges, interest prior to, during, and for a period not to
exceed the later of one year or one year following completion of
construction, as determined by the authority, the cost of insurance
during construction, the cost of funding or financing noncapital
expenses, reserves for principal and interest and for extensions,
enlargements, additions, replacements, renovations and improvements,
the cost of engineering, service contracts, reasonable financial and
legal services, plans, specifications, studies, surveys, estimates,
administrative expenses, and other expenses of funding or financing,
that are necessary or incident to determining the feasibility of
constructing any project, or that are incident to the construction,
acquisition, or financing of any project.
(d) "Health facility" means a facility, place, or building that is
licensed, accredited, or certified and organized, maintained, and
operated for the diagnosis, care, prevention, and treatment of human
illness, or physical, mental, or developmental disability, including
convalescence and rehabilitation and including care during and after
pregnancy, or for any one or more of these purposes, for one or more
persons, and includes, but is not limited to, all of the following
types:
(1) A general acute care hospital that is a health facility having
a duly constituted governing body with overall administrative and
professional responsibility and an organized medical staff that
provides 24-hour inpatient care, including the following basic
services: medical, nursing, surgical, anesthesia, laboratory,
radiology, pharmacy, and dietary services.
(2) An acute psychiatric hospital that is a health facility having
a duly constituted governing body with overall administrative and
professional responsibility and an organized medical staff that
provides 24-hour inpatient care for mentally disordered, incompetent,
or other patients referred to in Division 5 (commencing with Section
5000) or Division 6 (commencing with Section 6000) of the Welfare
and Institutions Code, including the following basic services:
medical, nursing, rehabilitative, pharmacy, and dietary services.
(3) A skilled nursing facility that is a health facility that
provides the following basic services: skilled nursing care and
supportive care to patients whose primary need is for availability or
skilled nursing care on an extended basis.
(4) An intermediate care facility that is a health facility that
provides the following basic services: inpatient care to ambulatory
or semiambulatory patients who have recurring need for skilled
nursing supervision and need supportive care, but who do not require
availability or continuous skilled nursing care.
(5) A special health care facility that is a health facility
having a duly constituted governing body with overall administrative
and professional responsibility and an organized medical or dental
staff that provides inpatient or outpatient, acute or nonacute care,
including, but not limited to, medical, nursing, rehabilitation,
dental, or maternity.
(6) A clinic that is operated by a tax-exempt nonprofit
corporation that is licensed pursuant to Section 1204 or 1204.1 of
the Health and Safety Code or a clinic exempt from licensure pursuant
to subdivision (b) or (c) of Section 1206 of the Health and Safety
Code.
(7) An adult day health center that is a facility, as defined
under subdivision (b) of Section 1570.7 of the Health and Safety
Code, that provides adult day health care, as defined under
subdivision (a) of Section 1570.7 of the Health and Safety Code.
(8) A facility owned or operated by a local jurisdiction for the
provision of county health services.
(9) A multilevel facility is an institutional arrangement where a
residential facility for the elderly is operated as a part of, or in
conjunction with, an intermediate care facility, a skilled nursing
facility, or a general acute care hospital. "Elderly," for the
purposes of this paragraph, means a person 62 years of age or older.
(10) A child day care facility operated in conjunction with a
health facility. A child day care facility is a facility, as defined
in Section 1596.750 of the Health and Safety Code. For purposes of
this paragraph, "child" means a minor from birth to 18 years of age.
(11) An intermediate care facility/developmentally disabled
habilitative that is a health facility, as defined under subdivision
(e) of Section 1250 of the Health and Safety Code.
(12) An intermediate care facility/developmentally
disabled-nursing that is a health facility, as defined under
subdivision (h) of Section 1250 of the Health and Safety Code.
(13) A community care facility that is a facility, as defined
under subdivision (a) of Section 1502 of the Health and Safety Code,
that provides care, habilitation, rehabilitation, or treatment
services to developmentally disabled or mentally impaired persons.
(14) A nonprofit community care facility, as defined in
subdivision (a) of Section 1502 of the Health and Safety Code, other
than a facility that, as defined in that subdivision, is a
residential facility for the elderly, a foster family agency, a
foster family home, a full service adoption agency, or a noncustodial
adoption agency.
(15) A nonprofit accredited community work activity program, as
specified in subdivision (e) of Section 4851 and Section 4856 of the
Welfare and Institutions Code.
(16) A community mental health center, as defined in paragraph (3)
of subdivision (b) of Section 5667 of the Welfare and Institutions
Code.
(17) A nonprofit speech and hearing center, as defined in Section
1201.5 of the Health and Safety Code.
(18) A blood bank, as defined in Section 1600.2 of the Health and
Safety Code, licensed pursuant to Section 1602.5 of the Health and
Safety Code, and exempt from federal income taxation pursuant to
Section 501(c)(3) of the Internal Revenue Code.
(19) A residential facility for persons with developmental
disabilities, as defined in Sections 4688.5 and 4688.6 of the Welfare
and Institutions Code, which includes, but is not limited to, a
community care facility licensed pursuant to Section 1502 of the
Health and Safety Code and a family teaching home as defined in
Section 4689.1 of the Welfare and Institutions Code.
(20) A nonpublic school that provides educational services in
conjunction with a health facility, as defined in paragraphs (1) to
(19), inclusive, that otherwise qualifies for financing pursuant to
this part, if the nonpublic school is certified pursuant to Sections
56366 and 56366.1 of the Education Code as meeting standards relating
to the required special education and specified related services and
facilities for individuals with physical, mental, or developmental
disabilities.
"Health facility" includes a clinic that is described in
subdivision (l) of Section 1206 of the Health and Safety Code.
"Health facility" includes information systems equipment and the
following facilities, if the equipment and facility is operated in
conjunction with or to support the services provided in one or more
of the facilities specified in paragraphs (1) to (20), inclusive, of
this subdivision: a laboratory, laundry, a nurses or interns
residence, housing for staff or employees and their families or
patients or relatives of patients, a physicians' facility, an
administration building, a research facility, a maintenance, storage,
or utility facility, an information systems facility, all structures
or facilities related to any of the foregoing facilities or required
or useful for the operation of a health facility and the necessary
and usual attendant and related facilities and equipment, and parking
and supportive service facilities or structures required or useful
for the orderly conduct of the health facility.
"Health facility" does not include any institution, place, or
building used or to be used primarily for sectarian instruction or
study or as a place for devotional activities or religious worship.
(e) "Participating health institution" means a city, city and
county, or county, a district hospital, or a private nonprofit
corporation or association, or a limited liability company whose sole
member is a nonprofit corporation or association authorized by the
laws of this state to provide or operate a health facility or a
nonprofit corporation that controls or manages, is controlled or
managed by, is under common control or management with, or is
affiliated with any of the foregoing, and that, pursuant to this
part, undertakes the financing or refinancing of the construction or
acquisition of a project or of working capital as provided in this
part. "Participating health institution" also includes, for purposes
of the California Health Facilities Revenue Bonds (UCSF-Stanford
Health Care) 1998 Series A, the Regents of the University of
California.
(f) "Project" means construction, expansion, remodeling,
renovation, furnishing, or equipping, or funding, financing, or
refinancing of a health facility or acquisition of a health facility
to be financed or refinanced with funds provided in whole or in part
pursuant to this part. "Project" may include reimbursement for the
costs of construction, expansion, remodeling, renovation, furnishing,
or equipping, or funding, financing, or refinancing of a health
facility or acquisition of a health facility. "Project" may include
any combination of one or more of the foregoing undertaken jointly by
any participating health institution with one or more other
participating health institutions.
(g) "Revenue bond" or "bond" means a bond, warrant, note, lease,
or installment sale obligation that is evidenced by a certificate of
participation or other evidence of indebtedness issued by the
authority.
(h) "Working capital" means moneys to be used by, or on behalf of,
a participating health institution to pay or prepay maintenance or
operation expenses or any other costs that would be treated as an
expense item, under generally accepted accounting principles, in
connection with the ownership or operation of a health facility,
including, but not limited to, reserves for maintenance or operation
expenses, interest for not to exceed one year on any loan for working
capital made pursuant to this part, and reserves for debt service
with respect to, and any costs necessary or incidental to, that
financing.
The authority shall consist of nine members, including the
State Treasurer, who shall serve as chairman, the State Controller,
the Director of Finance, two members appointed by the Senate Rules
Committee, two members appointed by the Speaker of the Assembly, and
two members appointed by the Governor subject to confirmation by a
majority vote of the Senate. Of the members appointed by the Senate
Rules Committee, one member shall be a licensed physician and
surgeon, and one shall serve or have served in an executive capacity
to a health facility. Of the members appointed by the Speaker of the
Assembly, one member shall be a person qualified by training and
experience in the field of investment or finance, and one member
shall be representative of the general public. The members appointed
by the Governor shall be representative of the general public. The
terms of appointed members shall be four years, expiring on March 31.
Each member shall hold office for the term of his or her appointment
and shall continue to serve until a successor shall have been
appointed and qualified. Any vacancy among the members shall be
filled by appointment for the unexpired term only. A member of the
authority shall be eligible for reappointment.
Members of the authority shall serve without compensation, but the
authority may reimburse its members for necessary expenses incurred
in the discharge of their duties.
The Director of Finance may designate a deputy or other official
in the Department of Finance to act for him or her and represent him
or her at all meetings of the authority.
The chairperson of the authority on its behalf shall appoint
an executive director, who shall not be a member of the authority
and who shall serve at the pleasure of the authority. The executive
director shall receive compensation that shall be fixed by the
authority.
The executive director or other person designated by
resolution of the authority shall keep a record of the proceedings of
the authority and shall be custodian of all books, documents and
papers filed with the authority, the minute book or journal of the
authority, and its official seal. The executive director or other
person may cause copies to be made of all minutes and other records
and documents of the authority and may give certificates under the
official seal of the authority to the effect that such copies are
true copies, and all persons dealing with the authority may rely upon
such certificates.
Five members of the authority shall constitute a quorum. The
affirmative vote of a majority of a quorum shall be necessary for
any action taken by the authority. A vacancy in the membership of the
authority shall not impair the right of a quorum to exercise all the
rights and perform all the duties of the authority. Each meeting of
the authority shall be open to the public and shall be held in
accordance with the provisions of the Bagley-Keene Open Meeting Act
(Article 9 (commencing with Section 11120) of Chapter 1 of Part 1).
Resolutions of the authority need not be published or posted. The
authority may delegate by resolution to one or more of its members or
its executive director such powers and duties as it may deem proper.
The authority may delegate to the executive director or any other
official or employee of the authority any powers and duties it may
deem proper, including, but not limited to, the power to enter
contracts on behalf of the authority.
(a) The provisions of this part shall be administered by the
authority, which shall have and is hereby vested with all powers
reasonably necessary to carry out the powers and responsibilities
expressly granted or imposed under this part.
(b) The authority shall establish financial eligibility standards
by studying the creditworthiness and earning capacity of each
project, together with the amount of pledged revenues, debt service
coverage, and basic security.
The authority may do any of the following:
(a) Adopt bylaws for the regulation of its affairs and the conduct
of its business.
(b) Adopt an official seal.
(c) Sue and be sued in its own name.
(d) Receive and accept from any agency of the United States, any
agency of the state, or any municipality, county, or other political
subdivision thereof, or from any individual, association, or
corporation gifts, grants, or donations of moneys for achieving any
of the purposes of this chapter.
(e) Engage the services of private consultants to render
professional and technical assistance and advice in carrying out the
purposes of this part.
(f) Determine the location and character of any project to be
financed under this part, and to acquire, construct, enlarge,
remodel, renovate, alter, improve, furnish, equip, fund, finance,
own, maintain, manage, repair, operate, lease as lessee or lessor,
and regulate the same, to enter into contracts for any or all of
those purposes, to enter into contracts for the management and
operation of a project or other health facilities owned by the
authority, and to designate a participating health institution as its
agent to determine the location and character of a project
undertaken by that participating health institution under this
chapter and as the agent of the authority, to acquire, construct,
enlarge, remodel, renovate, alter, improve, furnish, equip, own,
maintain, manage, repair, operate, lease as lessee or lessor, and
regulate the same, and as the agent of the authority, to enter into
contracts for any or all of those purposes, including contracts for
the management and operation of that project or other health
facilities owned by the authority.
(g) Acquire, directly or by and through a participating health
institution as its agent, by purchase solely from funds provided
under the authority of this part, or by gift or devise, and to sell,
by installment sale or otherwise, any lands, structures, real or
personal property, rights, rights-of-way, franchises, easements, and
other interests in lands, including lands lying under water and
riparian rights, that are located within the state that the authority
determines necessary or convenient for the acquisition,
construction, or financing of a health facility or the acquisition,
construction, financing, or operation of a project, upon the terms
and at the prices considered by the authority to be reasonable and
that can be agreed upon between the authority and the owner thereof,
and to take title thereto in the name of the authority or in the name
of a participating health institution as its agent.
(h) Receive and accept from any source loans, contributions, or
grants for, or in aid of, the construction, financing, or refinancing
of a project or any portion of a project in money, property, labor,
or other things of value.
(i) Make secured or unsecured loans to, or purchase secured or
unsecured loans of, any participating health institution in
connection with the financing of a project or working capital in
accordance with an agreement between the authority and the
participating health institution. However, no loan to finance a
project shall exceed the total cost of the project, as determined by
the participating health institution and approved by the authority.
Funds for secured loans may be provided from the California Health
Facilities Financing Authority Fund pursuant to subdivision (b) of
Section 15439 to small or rural health facilities pursuant to
authority guidelines.
(j) (1) Make secured or unsecured loans to, or purchase secured or
unsecured loans of, any participating health institution in
accordance with an agreement between the authority and the
participating health institution to refinance indebtedness incurred
by that participating health institution or a participating health
institution that controls or manages, is controlled or managed by, is
under common control or management with, or is affiliated with that
participating health institution, in connection with projects
undertaken or for health facilities acquired or for working capital.
(2) Make secured or unsecured loans to, or purchase secured or
unsecured loans of, any participating health institution in
accordance with an agreement between the authority and the
participating health institution to refinance indebtedness incurred
by that participating health institution or a participating health
institution that controls or manages, is controlled or managed by, is
under common control or management with, or is affiliated with that
participating health institution, payable to the authority or
assigned or pledged to authority issued bonds.
(3) Funds for secured loans may be provided from the California
Health Facilities Financing Authority Fund pursuant to subdivision
(b) of Section 15439 to small or rural health facilities pursuant to
authority guidelines.
(k) Mortgage all or any portion of interest of the authority in a
project or other health facilities and the property on which that
project or other health facilities are located, whether owned or
thereafter acquired, including the granting of a security interest in
any property, tangible or intangible, and to assign or pledge all or
any portion of the interests of the authority in mortgages, deeds of
trust, indentures of mortgage or trust, or similar instruments,
notes, and security interests in property, tangible or intangible, of
participating health institutions to which the authority has made
loans, and the revenues therefrom, including payments or income from
any thereof owned or held by the authority, for the benefit of the
holders of bonds issued to finance the project or health facilities
or issued to refund or refinance outstanding indebtedness of
participating health institutions as permitted by this part.
(l) Lease to a participating health institution the project being
financed or other health facilities conveyed to the authority in
connection with that financing, upon the terms and conditions the
authority determines proper, charge and collect rents therefor,
terminate the lease upon the failure of the lessee to comply with any
of the obligations of the lease, and include in that lease, if
desired, provisions granting the lessee options to renew the term of
the lease for the period or periods and at the rent, as determined by
the authority, purchase any or all of the health facilities or that
upon payment of all of the indebtedness incurred by the authority for
the financing of that project or health facilities or for refunding
outstanding indebtedness of a participating health institution, then
the authority may convey any or all of the project or the other
health facilities to the lessee or lessees thereof with or without
consideration.
(m) Charge and equitably apportion among participating health
institutions, the administrative costs and expenses incurred by the
authority in the exercise of the powers and duties conferred by this
part.
(n) Obtain, or aid in obtaining, from any department or agency of
the United States or of the state, any private company, or any
insurance or guarantee as to, of, or for the payment or repayment of,
interest or principal, or both, or any part thereof, on any loan,
lease, or obligation, or any instrument evidencing or securing the
loan, lease, or obligation, made or entered into pursuant to this
part; and notwithstanding any other provisions of this part, to enter
into any agreement, contract, or any other instrument whatsoever
with respect to that insurance or guarantee, to accept payment in the
manner and form as provided therein in the event of default by a
participating health institution, and to assign that insurance or
guarantee as security for the authority's bonds.
(o) Enter into any and all agreements or contracts, including
agreements for liquidity or credit enhancement, bond exchange
agreements, interest rate swaps or hedges, execute any and all
instruments, and do and perform any and all acts or things necessary,
convenient, or desirable for the purposes of the authority or to
carry out any power expressly granted by this part.
(p) Invest any moneys held in reserve or sinking funds or any
moneys not required for immediate use or disbursement, at the
discretion of the authority, in any obligations authorized by the
resolution authorizing the issuance of the bonds secured thereof or
authorized by law for the investment of trust funds in the custody of
the Treasurer.
(q) Award grants to any eligible clinic pursuant to Section
15438.6.
(r) Award grants to any eligible health facility pursuant to
Section 15438.7.
(s) (1) Notwithstanding any other provision of law, provide a
working capital loan of up to five million dollars ($5,000,000) to
assist in the establishment and operation of the California Health
Benefit Exchange (Exchange) established under Section 100500. The
authority may require any information it deems necessary and prudent
prior to providing a loan to the Exchange and may require any term,
condition, security, or repayment provision it deems necessary in the
event the authority chooses to provide a loan. Under no
circumstances shall the authority be required to provide a loan to
the Exchange.
(2) Prior to the authority providing a loan to the Exchange, a
majority of the board of the Exchange shall be appointed and shall
demonstrate, to the satisfaction of the authority, that the federal
planning and establishment grants made available to the Exchange by
the United States Secretary of Health and Human Services are
insufficient or will not be released in a timely manner to allow the
Exchange to meet the necessary requirements of the federal Patient
Protection and Affordable Care Act (Public Law 111-148).
(3) The Exchange shall repay a loan made under this subdivision no
later than June 30, 2016, and shall pay interest at the rate paid on
moneys in the Pooled Money Investment Account.
(t) Award grants pursuant to Section 15438.10.
(a) When capital outlay funds are granted on property
which is leased for a child day care facility, the term of the lease
shall be as long as, or greater than, the term of the loan.
(b) Child day care facilities shall be insurable under the
California Health Facility Construction Loan Insurance Law.
(a) It is the intent of the Legislature in enacting this
part to provide financing only, and, except as provided in
subdivisions (b), (c), and (d), only to participating health
institutions that can demonstrate the financial feasibility of their
projects. It is further the intent of the Legislature that all or
part of any savings experienced by a participating health
institution, as a result of that tax-exempt revenue bond funding, be
passed on to the consuming public through lower charges or
containment of the rate of increase in hospital rates. It is not the
intent of the Legislature in enacting this part to encourage unneeded
health facility construction. Further, it is not the intent of the
Legislature to authorize the authority to control or participate in
the operation of hospitals, except where default occurs under the
terms of an agreement with the authority.
(b) When determining the financial feasibility of projects, the
authority shall consider the more favorable interest rates reasonably
anticipated through the issuance of revenue bonds under this part.
It is the intent of the Legislature that the authority attempt in
whatever ways possible to assist participating health institutions to
finance projects that will meet the financial feasibility standards
developed under this part.
(c) If a participating health institution seeking financing for a
project pursuant to this part does not meet the guidelines
established by the authority with respect to bond rating, the
authority may nonetheless give special consideration, on a
case-by-case basis, to financing the project if the participating
health institution demonstrates to the satisfaction of the authority
the financial feasibility of the project, and the performance of
significant community service. For the purposes of this part, a
participating health institution that performs a significant
community service is one that contracts with Medi-Cal or that can
demonstrate, with the burden of proof being on the participating
health institution, that it has fulfilled at least two of the
following criteria:
(1) On or before January 1, 1991, has established, and agrees to
maintain, a 24-hour basic emergency medical service open to the
public with a physician and surgeon on duty, or is a children's
hospital as defined in Section 14087.21 of the Welfare and
Institutions Code, that jointly provides basic or comprehensive
emergency services in conjunction with another licensed hospital.
This criterion shall not be utilized in a circumstance where a small
and rural hospital, as defined in Section 442.2 of the Health and
Safety Code, has not established a 24-hour basic emergency medical
service with a physician and surgeon on duty or will operate a
designated trauma center on a continuing basis during the life of the
revenue bonds issued by the authority.
(2) Has adopted, and agrees to maintain on a continuing basis
during the life of the revenue bonds issued by the authority, a
policy, approved and recorded by the facility's board of directors,
of treating all patients without regard to ability to pay, including,
but not limited to, emergency room walk-in patients.
(3) Has provided and agrees to provide care, on a continuing basis
during the life of the revenue bonds issued by the authority, to
Medi-Cal and uninsured patients in an amount not less than 5 percent
of the facility's adjusted inpatient days as reported on an annual
basis to the Office of Statewide Health Planning and Development.
(4) Has budgeted at least 5 percent of its net operating income to
meeting the medical needs of uninsured patients and to providing
other services, including, but not limited to, community education,
primary care outreach in ambulatory settings, and unmet nonmedical
needs, such as food, shelter, clothing, or transportation for
vulnerable populations in the community, and agrees to continue that
policy during the life of the revenue bonds issued by the authority.
(d) Enforcement of the conditions under which the authority issues
bonds pursuant to this section shall be governed by the enforcement
conditions under Section 15459.4.
(a) This section shall be known, and may be cited, as the
Cedillo-Alarcon Community Clinic Investment Act of 2000.
(b) The Legislature finds and declares all of the following:
(1) Primary care clinics require capital improvements in order to
continuously perform their vital role. Many primary care clinics are
currently at capacity and in order to increase access to their
services and allow them to expand to cover the growing need for
health care for the vulnerable populations in California, these
capital funds are necessary.
(2) Primary care clinics are the health care safety net for the
most vulnerable populations in California: uninsured, underinsured,
indigent, and those in shortage designation areas. Primary care
clinics provide health care regardless of the ability to pay for
services.
(3) Approximately 6.6 million Californians lack health insurance,
a number that increases by 50,000 per month.
(4) Primary care clinics have been historically and woefully
underfunded.
(5) Primary care clinics are the most cost-effective means of
serving California's vulnerable populations.
(6) The failure to adequately fund primary care clinics has
resulted in significant costs to the state in the form of unnecessary
emergency room visits. Also, the lack of preventive care results in
significant costs when patients become severely ill.
(c) The authority may award grants to any eligible clinic, as
defined in subdivision (a) of Section 1204 and subdivision (c) of
Section 1206 of the Health and Safety Code, for purposes of financing
capital outlay projects, as defined in subdivision (f) of Section
15432.
(d) The authority, in consultation with representatives of primary
care clinics and other appropriate parties, shall develop selection
criteria and a process for awarding grants under this section. The
authority may take into account at least the following factors when
selecting recipients and determining amount of grants:
(1) The percentage of total expenditures attributable to
uncompensated care provided by an applicant.
(2) The extent to which the grant will contribute toward expansion
of health care access by indigent, underserved, and uninsured
populations.
(3) The need for the grant based on an applicant's total net
assets, relative to net assets of other applicants. For purposes of
this section, "total net assets" means the amount of total assets
minus total liabilities, as disclosed in an audited financial
statement prepared according to United States Generally Accepted
Accounting Principles, and shall include unrestricted net assets,
temporarily restricted net assets, and permanently restricted net
assets.
(4) The geographic location of the applicant, in order to maximize
broad geographic distribution of funding.
(5) Demonstration by the applicant of project readiness and
feasibility to the authority's satisfaction.
(6) The total amount of funds appropriated and available for
purposes of this section.
(e) No grant to any clinic facility shall exceed two hundred fifty
thousand dollars ($250,000).
(f) In no event shall a grant to finance a project exceed the
total cost of the project, as determined by the clinic and approved
by the authority. Grants shall be awarded only to clinics that have
certified to the authority that all requirements established by the
authority for grantees have been met.
(g) All projects that are awarded grants shall be completed within
a reasonable period of time, to be determined by the authority. No
funds shall be released by the authority until the applicant
demonstrates project readiness to the authority's satisfaction. If
the authority determines that the clinic has failed to complete the
project under the terms specified in awarding the grant, the
authority may require remedies, including the return of all or a
portion of the grant. Certification of project completion shall be
submitted to the authority by any clinic receiving a grant under this
section.
(h) Any clinic receiving a grant under this section shall commit
to using the health facility for the purposes for which the grant was
awarded for the duration of the expected life of the project.
(i) It is the intent of the Legislature that the California Health
Facilities Financing Authority be reimbursed for the costs of the
administration of the implementation of this section from funds
appropriated for the purposes of this section.
(a) The Legislature finds and declares all of the
following:
(1) There are small health care facilities throughout the state
that are in critical need of capital improvements to continue to
provide quality health care services.
(2) Some of these facilities currently lack the ability to take on
debt and have little access to capital.
(3) This lack of access to capital threatens the quality and
accessibility of the services provided by health care facilities and
hampers their ability to gain the financial strength to better access
the capital markets.
(4) The state's health care system is reliant upon those health
care facilities that treat low-income, uninsured, or vulnerable
populations, such as the developmentally disabled, the elderly, the
mentally ill, emotionally disturbed children, and the chemically
dependent.
(5) The grant program provided in this section is in the public
interest, serves a public purpose, and will promote the health,
welfare, and safety of the citizens of the state.
(b) The authority may award grants to any eligible health
facility, as defined in subdivision (d) of Section 15432 for purposes
of financing projects, as defined in subdivision (f) of Section
15432.
(c) The authority shall develop selection criteria and a process
for awarding grants under this section. When developing the selection
criteria for the awarding of grants under this section, the
authority shall take into consideration all of the following factors:
(1) The need for the grant based on the applicant's total net
assets.
(2) Whether the grant will leverage additional dollars to complete
the project.
(3) The importance and level of services to vulnerable populations
that will be generated.
(4) The level of access to capital by the applicant.
(5) Demonstration by the applicant of project readiness and
feasibility.
(6) Total dollars available for purposes of this section.
(d) It is the intent of the Legislature to assist those small
health facilities that have demonstrated superior management but
little to no access to capital and whose services are threatened by a
critical need for capital improvements.
(e) In no event shall a grant to finance a project exceed the
total cost of the project, as determined by the health facility and
approved by the authority. Grants shall be awarded only to facilities
that have certified to the authority that all requirements
established by the authority for grantees have been met.
(f) All projects that are awarded grants shall be completed within
a reasonable period of time, to be determined by the authority. No
funds shall be released by the authority until the applicant
demonstrates project readiness to the authority's satisfaction. If
the authority determines that the health facility has failed to
complete the project under the terms specified in awarding the grant,
the authority may require remedies, including the return of all or a
portion of the grant. Certification of project completion shall be
submitted to the authority by any health facility receiving a grant
under this section.
(g) Subject to subdivision (h), grants to be awarded under this
section shall be financed by funds from the California Health
Facilities Authority Fund.
(h) Grants shall only be available pursuant to this section if the
authority determines that it has sufficient moneys available in the
California Health Facilities Authority Fund. Nothing in this section
shall require the authority to award grants if the authority
determines that it has insufficient moneys available in the
California Health Facilities Authority Fund to award grants.
(i) The authority may annually determine the amount available for
purposes of this section.
(a) The Legislature finds and declares the following:
(1) Many Californians face serious obstacles in obtaining needed
health care services, including, but not limited to, medical, mental
health, dental, and preventive services. The obstacles faced by
vulnerable populations and communities include existence of complex
medical, physical, or social conditions, disabilities, economic
disadvantage, and living in remote or underserved areas that make it
difficult to access services.
(2) With the recent passage of national health care reform, there
is an increased demand for innovative ways to deliver quality health
care, including preventive services, to individuals in a
cost-effective manner.
(3) There is a need to develop new methods of delivering health
services utilizing innovative models that can be demonstrated to be
effective and then replicated throughout California and that bring
community-based health care preventive services to individuals where
they live or receive education, social, or general health services.
(4) For more than 30 years, the California Health Facilities
Financing Authority has provided financial assistance through
tax-exempt bonds, low-interest loans, and grants to health facilities
in California, assisting in the expansion of the availability of
health services and health care facilities throughout the state.
(b) (1) Following the completion of a competitive selection
process, the authority may award one or more grants that, in the
aggregate, do not exceed one million five hundred thousand dollars
($1,500,000) to one or more projects designed to demonstrate
specified new or enhanced cost-effective methods of delivering
quality health care services to improve access to quality health care
for vulnerable populations or communities, or both, that are
effective at enhancing health outcomes and improving access to
quality health care and preventive services. These health care
services may include, but are not limited to, medical, mental health,
or dental services for the diagnosis, care, prevention, and
treatment of human illness, or individuals with physical, mental, or
developmental disabilities. More than one demonstration project may
receive a grant pursuant to this section. It is the intent of the
Legislature for a demonstration project that receives a grant to
allow patients to receive screenings, diagnosis, or treatment in
community settings, including, but not limited to, school-based
health centers, adult day care centers, and residential care
facilities for the elderly, or for individuals with mental illness or
developmental disabilities.
(2) A grant awarded pursuant to this subdivision may be allocated
in increments to a demonstration project over multiple years to
ensure the demonstration project's ability to complete its work, as
determined by the authority. Prior to the initial allocation of funds
pursuant to this subdivision, the administrators of the
demonstration project shall provide evidence that the demonstration
project has or will have additional funds sufficient to ensure
completion of the demonstration project. If the authority allocates a
grant in increments, each subsequent year's allocation shall be
provided to the demonstration project only upon submission of
research that shows that the project is progressing toward the
identification of a high-quality and cost-effective delivery model
that improves health outcomes and access to quality health care and
preventive services for vulnerable populations or communities, and
can be replicated throughout the state in community settings.
(3) Except for a health facility that qualifies as a "small and
rural hospital" pursuant to Section 124840 of the Health and Safety
Code, a health facility that has received tax-exempt bond financing
from the authority shall not be eligible to receive funds awarded for
a demonstration project. Such a health facility may participate as
an uncompensated partner or member of a collaborative effort that is
awarded a demonstration project grant. A health facility that
participates in a demonstration project that receives funds pursuant
to this section may not claim the funding provided by the authority
toward meeting its community benefit and charity care obligations.
(4) Funds provided to a demonstration project pursuant to this
subdivision may be used to supplement, but not to supplant, existing
financial and resource commitments of the grantee or grantees or any
other member of a collaborative effort that has been awarded a
demonstration project grant.
(c) (1) If a demonstration project that receives a grant pursuant
to subdivision (b) is successful at developing a new method of
delivering high-quality and cost-effective health care services in
community settings that result in increased access to quality health
care and preventive services or improved health care outcomes for
vulnerable populations or communities, or both, then beginning as
early as the second year after the initial allocation of moneys
provided pursuant to subdivision (b), the authority may implement a
second grant program that awards not more than five million dollars
($5,000,000), in the aggregate, to eligible recipients as defined by
the authority, to replicate in additional California communities the
model developed by a demonstration project that received a grant
pursuant to subdivision (b). Prior to the implementation of this
second grant program, the authority shall prepare and provide a
report to the Legislature and the Governor on the outcomes of the
demonstration project. The report shall be made in accordance with
Section 9795.
(2) If the authority implements the second grant program, the
authority shall also report annually, beginning with the first year
of implementation of the second grant program, to the Legislature and
the Governor regarding the program, including, but not limited to,
the total amount of grants issued pursuant to this subdivision, the
amount of each grant issued, and a description of each project
awarded funding for replication of the model.
(3) Grants under this subdivision may be utilized for eligible
costs, as defined in subdivision (c) of Section 15432, including
equipment, information technology, and working capital, as defined in
subdivision (h) of Section 15432.
(4) The authority may adopt regulations relating to the grant
program authorized pursuant to this subdivision, including
regulations that define eligible recipients, eligible costs, and
minimum and maximum grant amounts.
(d) (1) The authority shall prepare and provide a report to the
Legislature and the Governor by January 1, 2014, on the outcomes of
the demonstration grant program, including, but not limited to, the
following:
(A) The total amount of grants issued.
(B) The amount of each grant issued.
(C) A description of other sources of funding for each project.
(D) A description of each project awarded funding.
(E) A description of project outcomes that demonstrate
cost-effective delivery of health care services in community
settings, that result in improved access to quality health care or
improved health care outcomes.
(2) A report submitted pursuant to this subdivision shall be
submitted in compliance with Section 9795.
(e) There is hereby created the California Health Access Model
Program Account in the California Health Facilities Financing
Authority Fund. All moneys in the account are hereby continuously
appropriated to the authority for carrying out the purposes of this
section. An amount of up to six million five hundred thousand dollars
($6,500,000) shall be transferred from funds in the California
Health Facilities Financing Authority Fund that are not impressed
with a trust for other purposes into the California Health Access
Model Program Account for the purpose of issuing grants pursuant to
this section. Any moneys remaining in the California Health Access
Model Program Account on January 1, 2020, shall revert as of that
date to the California Health Facilities Financing Authority Fund.
(f) Any recipient of a grant provided pursuant to subdivision (b)
shall adhere to all applicable laws relating to scope of practice,
licensure, staffing, and building codes.
(a) The California Health Facilities Authority Fund is
continued in existence in the State Treasury as the California Health
Facilities Financing Authority Fund. All money in the fund is hereby
continuously appropriated to the authority for carrying out the
purposes of this division. The authority may pledge any or all of the
moneys in the fund as security for payment of the principal of, and
interest on, any particular issuance of bonds issued pursuant to this
part, or any particular secured or unsecured loan made pursuant to
subdivision (i), (j), or (s) of Section 15438, or for a grant awarded
pursuant to subdivision (b) of Section 15438.7, and, for that
purpose or as necessary or convenient to the accomplishment of any
other purpose of the authority, may divide the fund into separate
accounts. All moneys accruing to the authority pursuant to this part
from whatever source shall be deposited in the fund.
(b) Subject to the priorities that may be created by the pledge of
particular moneys in the fund to secure any issuance of bonds of the
authority, and subject further to the cost of loans provided by the
authority pursuant to subdivisions (i), (j), or (s) of Section 15438
and to the cost of grants provided by the authority pursuant to
Section 15438.7, and subject further to any reasonable costs which
may be incurred by the authority in administering the program
authorized by this division, all moneys in the fund derived from any
source shall be held in trust for the security and payment of bonds
of the authority and shall not be used or pledged for any other
purpose so long as the bonds are outstanding and unpaid. However,
nothing in this section shall limit the power of the authority to
make loans with the proceeds of bonds in accordance with the terms of
the resolution authorizing the same or pledging or granting a
security interest to the provider of credit support as specified in
the documents pursuant to which authority revenue bonds are issued.
(c) Pursuant to any agreements with the holders of particular
bonds pledging any particular assets, revenues, or moneys, the
authority may create separate accounts in the fund to manage assets,
revenues, or moneys in the manner set forth in the agreements.
(d) The authority may, from time to time, direct the Treasurer to
invest moneys in the fund that are not required for its current
needs, including proceeds from the sale of any bonds, in the eligible
securities specified in Section 16430 as the agency shall designate.
The authority may direct the Treasurer to deposit moneys in
interest-bearing accounts in state or national banks or other
financial institutions having principal offices in this state. The
authority may alternatively require the transfer of moneys in the
fund to the Surplus Money Investment Fund for investment pursuant to
Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of
Division 4. All interest or other increment resulting from an
investment or deposit shall be deposited in the fund, notwithstanding
Section 16305.7. Moneys in the fund shall not be subject to transfer
to any other fund pursuant to any provision of Part 2 (commencing
with Section 16300) of Division 4, excepting the Surplus Money
Investment Fund.
(e) All moneys accruing to the authority from whatever source
shall be deposited in the fund.
All expenses of the authority incurred in carrying out the
provisions of this part shall be payable solely from funds provided
pursuant to this part, and no liability shall be incurred by the
authority beyond the extent to which moneys shall have been provided
under this part.
(a) The authority is authorized, from time to time, to issue
its revenue bonds in order to provide funds for achieving any of its
purposes under this part.
(b) Except as may otherwise be expressly provided by the
authority, each of its revenue bonds shall be payable from any
revenues or moneys of the authority available therefor and not
otherwise pledged, subject only to any agreements with the holders of
particular bonds or notes pledging any particular revenues or
moneys. Negotiable bonds shall be and be deemed to be for all
purposes negotiable instruments, notwithstanding that these bonds may
be payable from a special fund, subject only to the provisions of
these bonds for registration.
(c) The authority's revenue bonds may be issued as serial bonds or
as term bonds, or the authority, in its discretion, may issue bonds
of both types. The issuance of all revenue bonds shall be authorized
by resolution of the authority and shall bear such date or dates,
mature at such time or times, not exceeding 40 years from their
respective dates, bear interest at such rate or rates, be payable at
such time or times, be in such denominations, be in such form, either
coupon or registered, carry such registration privileges, be
executed in such manner, be payable in lawful money of the United
States of America at such place or places, and be subject to such
terms of redemption, as the indenture, trust agreement, or resolution
relating to these revenue bonds may provide. The authority's revenue
bonds or notes may be sold by the Treasurer at public or private
sale, after giving due consideration to the recommendation of the
participating health institution, for the price or prices and upon
the terms and conditions as the authority shall determine. The
Treasurer may sell these revenue bonds at a price below the par value
thereof. However, the discount on any bonds so sold shall not exceed
6 percent of the par value thereof, except in the case of any bonds
payable in whole or in part from moneys held under one or more
outstanding resolutions or indentures. Pending preparation of the
definitive bonds, the authority may issue interim receipts or
certificates or temporary bonds which shall be exchanged for such
definitive bonds.
(d) A resolution or resolutions authorizing the issuance of any
revenue bonds or any issue of revenue bonds may contain provisions,
which shall be a part of the contract with the holders of the bonds
to be authorized, as to pledging all or any part of the revenues of a
project or any revenue-producing contract or contracts made by the
authority with an individual, partnership, corporation or association
or other body, public or private, to secure the payment of the bonds
or of a particular issue of bonds.
(e) Neither the members of the authority nor any person executing
the revenue bonds shall be liable personally on the bonds or be
subject to any personal liability or accountability by reason of the
issuance thereof.
(f) The authority may purchase its bonds with any moneys available
to the authority for this purpose. The authority may exchange bonds
for its bonds. The authority may hold, pledge, exchange, cancel, or
resell these bonds, subject to and in accordance with its agreements
with bondholders.
In the discretion of the authority, any revenue bonds issued
under the provisions of this part may be secured by a trust
agreement or indenture by and between the authority and a corporate
trustee or trustees, which may be the Treasurer or any trust company
or bank having the powers of a trust company within or without the
state. The trust agreement, indenture, or the resolution providing
for the issuance of these bonds may pledge or assign the revenues to
be received from a participating health institution. The indenture,
trust agreement, or resolution providing for the issuance of these
bonds may contain provisions for protecting and enforcing the rights
and remedies of the bondholders and any provider of credit or
liquidity support for these bonds as may be reasonable and proper and
not in violation of law, including particularly those provisions as
have hereinabove been specifically authorized to be included in any
resolution or resolutions of the authority authorizing bonds thereof.
Any trust agreement or indenture may set forth the rights and
remedies of the bondholders, any provider of credit or liquidity
support for these bonds, and of the trustee or trustees, and may
restrict the individual right of action of bondholders. In addition
to the foregoing, any indenture, trust agreement, or resolution may
contain such other provisions as the authority may deem reasonable
and proper for the security of the bondholders.
Any provision that the authority may include in a trust
agreement, indenture, or resolution pursuant to this part may
alternatively be included in a bond with the same effect.
Revenue bonds issued under the provisions of this part shall
not be deemed to constitute a debt or liability of the state or of a
political subdivision thereof or a pledge of the faith and credit of
the state or of that political subdivision, other than the
authority, but shall be payable solely from the funds herein
provided. These bonds shall contain a statement to the effect that
neither the State of California nor the authority shall be obligated
to pay the principal of, or the interest thereon, except from
revenues of the authority, and that neither the faith and credit nor
the taxing power of the State of California or of a political
subdivision thereof is pledged to the payment of the principal of or
the interest on these bonds. The issuance of revenue bonds under the
provisions of this part shall not directly or indirectly or
contingently obligate the state or a political subdivision thereof to
levy or to pledge a form of taxation whatever therefor or to make an
appropriation for their payment.
Any holder of revenue bonds issued under the provisions of
this part or any of the coupons appertaining thereto, and the trustee
or trustees under any indenture or trust agreement, except to the
extent the rights herein given may be restricted by any resolution
authorizing the issuance of, or any such indenture or trust agreement
securing, such bonds, may, either at law or in equity, by suit,
action, mandamus or other proceedings, protect and enforce any and
all rights under the laws of the state or granted hereunder or under
such resolution or indenture or trust agreement, and may enforce and
compel the performance of all duties required by this part or by such
resolution, indenture, or trust agreement to be performed by the
authority or by any officer, employee or agent thereof.
All moneys received pursuant to this part, whether as
proceeds from selling or incurring revenue bonds or as revenues,
shall be deemed to be trust funds to be held and applied solely as
provided in this part. Until the funds are applied as provided in
this part, and notwithstanding any other provision of law, the moneys
may be invested in any obligations or securities authorized by
resolutions of the authority authorizing the issuance of the bonds.
Any officer with whom, or any bank or trust company with which, the
moneys are deposited shall act as trustee of the moneys and shall
hold and apply the moneys for the purposes hereof, subject to any
regulations adopted pursuant to this part and the resolution
authorizing the issuance of the bonds or the indenture or trust
agreement securing the bonds.
(a) The authority may provide for the issuance of bonds of
the authority for the purpose of redeeming, refunding, or retiring
any bonds or any series or issue of bonds then outstanding issued for
the benefit of a participating health institution to finance or
refinance a project, including the payment of any redemption premium
thereon and any interest accrued or to accrue to the date of
redemption, purchase, or maturity of the bonds.
(b) The proceeds of any bonds issued for the purpose of refunding
of outstanding bonds may, in the discretion of the authority, be
applied to the purchase, redemption prior to maturity, or retirement
at maturity of any outstanding bonds on their earliest redemption
date or dates, upon their purchase or maturity, or paid to a third
person to assume the authority's obligation or the applicable bond
issuer's obligation to make the payments, and may, pending that
application, be placed in escrow to be applied to the purchase,
retirement at maturity, or redemption on the date or dates determined
by the authority or the participating health institution.
(c) Any proceeds placed in escrow may, pending their use, be
invested and reinvested in obligations or securities authorized by
resolutions of the authority or as determined by the participating
health institution, payable or maturing at the time or times as are
appropriate to assure the prompt payment of the principal, interest,
and redemption premium, if any, of the outstanding bonds to be
refunded at maturity or redemption of the bonds to be refunded either
at their earliest redemption date or dates or any subsequent
redemption date or dates or for payment of interest on the refunding
bonds on or prior to the final date of redemption or payment of the
bonds to be refunded. After the terms of the escrow have been fully
satisfied and carried out, any balance of the proceeds and interest,
income and profits, if any, earned or realized on the investments
thereof may be returned to the authority for use by the authority or
the participating health institution.
(d) All of the bonds issued pursuant to subdivision (a) are
subject to this part in the same manner and to the same extent as
other bonds issued pursuant to this part.
Bonds issued by the authority under the provisions of this
part are hereby made securities in which all banks, bankers, savings
banks, trust companies and other persons carrying on a banking
business, all insurance companies, insurance associations and other
persons carrying on an insurance business, and all administrators,
executors, guardians, trustees and other fiduciaries, and all other
persons whatsoever who now are or may hereafter be authorized to
invest in bonds or other obligations of the state, may properly and
legally invest any funds, including capital belonging to them or
within their control; and such bonds, notes or other securities or
obligations are hereby made securities which may properly and legally
be deposited with and received by any state or municipal officers or
agency of the state for any purpose for which the deposit of bonds
or other obligations of the state is now or may hereafter be
authorized by law.
Any bonds issued under the provisions of this part, their
transfer, and the income therefrom shall at all times be free from
taxation of every kind by the state and by all political subdivisions
in the state.
The State of California does pledge to and agree with the
holders of the bonds issued pursuant to this part, and with those
parties who may enter into contracts with the authority pursuant to
the provisions of this part, that the state will not limit, alter or
restrict the rights hereby vested in the authority to finance health
care facilities and to fulfill the terms of any agreements made with
the holders of bonds authorized by this part, and with the parties
who may enter into contracts with the authority pursuant to the
provisions of this part, or in any way impair the rights or remedies
of the holders of such bonds or such parties until the bonds,
together with interest thereon, are fully paid and discharged and
such contracts are fully performed on the part of the authority. The
authority as a public body corporate and politic shall have the right
to include the pledge herein made in its bonds and contracts.
A pledge by or to the authority of revenues, moneys,
accounts, accounts receivable, contract rights and other rights to
payment of whatever kind made by or to the authority pursuant to the
authority granted in this part shall be valid and binding from the
time the pledge is made for the benefit of pledges and successors
thereto. The revenues, moneys, accounts, accounts receivable,
contract rights and other rights to payment of whatever kind pledged
by or to the authority or its assignees shall immediately be subject
to the lien of the pledge without physical delivery or further act.
The lien of such pledge shall be valid and binding against all
parties, irrespective of whether the parties have notice of the
claim. The indenture, trust agreement, resolution or another
instrument by which such pledge is created need not be recorded.
The authority shall fix, revise, charge and collect rents
for the use of each project owned by the authority and contract with
any person, partnership, association or corporation, or other body,
public or private, in respect thereof. Each lease entered into by the
authority with a participating health institution and each
agreement, note, mortgage or other instrument evidencing the
obligations of a participating health institution to the authority
shall provide that the rents or principal, interest and other charges
payable by the participating health institution shall be sufficient
at all times, (a) to pay the principal of, sinking fund payments, if
any, the premium, if any, and the interest on outstanding bonds of
the authority issued in respect of such project as the same shall
become due and payable, (b) to create and maintain reserves which may
but need not be required or provided for in the resolution relating
to such bonds of the authority, and (c) to pay its share of the
administrative costs and expenses of the authority. The authority
shall pledge the revenues derived and to be derived from a project or
other related health facilities or from a participating health
institution for the purposes specified in (a), (b), and (c) of the
preceding sentence and additional bonds may be issued which may rank
on a parity with other bonds relating to the project to the extent
and on the terms and conditions provided in the bond resolution.
A participating health institution that is a private
nonprofit corporation or association and that borrows money to
finance working capital pursuant to this part, other than as part of
the cost of a project, shall be required to repay and discharge the
loan within 15 months of the loan date.
When the principal of and interest on bonds issued by the
authority to finance the cost of a project or working capital or to
refinance outstanding indebtedness of one or more participating
health institutions, including any refunding bonds issued to refund
and refinance those bonds, have been fully paid and retired or when
adequate provision has been made to fully pay and retire those bonds,
and all other conditions of the resolution, the lease, the trust
indenture and any mortgage or deed of trust, security interest, or
any other instrument or instruments authorizing and securing the
bonds have been satisfied and the lien of the mortgage, deed of trust
or security interest has been released in accordance with the
provisions thereof, the authority shall promptly do all things and
execute those releases, release deeds, reassignments, deeds, and
conveyances necessary and required to convey or release any rights,
title, and interest of the authority in the project so financed, and
any other health facilities mortgaged or securities or instruments
pledged or transferred to secure the bonds, to the participating
health institution or institutions.
(a) This part shall be deemed to provide a complete,
additional, and alternative method for doing the things authorized by
this part, and shall be regarded as supplemental and additional to
powers conferred by other laws. The issuance of bonds and refunding
bonds under this part need not comply with any other law applicable
to the issuance of bonds, including, but not limited to, Division 13
(commencing with Section 21000) of the Public Resources Code.
(b) Except as provided in subdivision (a), the financing of a
project pursuant to this part shall not exempt a project from any
requirement of law that is otherwise applicable to the project, and
the applicant shall provide documentation, before the authority
approves the issuance of bonds for the project, that the project has
complied with Division 13 (commencing with Section 21000) of the
Public Resources Code, or is not a project under that division.
To the extent that the provisions of this part are
inconsistent with any other provisions of any general statute or
special act or parts thereof, the provisions of this part shall be
deemed controlling.
Any net earnings of the authority beyond that necessary for
retirement of any obligations issued by the authority or to implement
the purposes of this chapter may inure to the benefit only of the
State of California or the authority.
Upon dissolution of the authority, title to all property
owned by the authority shall vest in the successor authority created
by the Legislature, if any, if such successor authority qualifies
under Section 103 of the federal Internal Revenue Code of 1954, as
amended, and the regulations promulgated thereunder, as an authority
entitled to issue obligations on behalf of the State of California
the interest on which is exempt from federal income taxation. If no
such successor authority is so created, title to such property shall
vest in the State of California.
As a condition of the issuance of revenue bonds, whether by
the authority or any local agency, to finance the construction,
expansion, remodeling, renovation, furnishing, or equipping of a
health facility or the acquisition of a health facility, each
participating health institution shall give reasonable assurance to
the authority that the services of the health facility will be made
available to all persons residing or employed in the area served by
the facility.
For the purposes of this section and Sections 15459.1, 15459.2,
15459.3, and 15459.4, all of the following definitions apply:
(a) "Local agency" means any public district, public corporation,
authority, agency, board, commission, county, city and county, city,
school district, or any other public entity.
(b) "Revenue bond" means any bonds, warrants, notes, lease, or
installment sale obligations evidenced by certificates of
participation, or other evidence of indebtedness issued by the
authority or by a local agency payable from funds other than the
proceeds of ad valorem taxes or the proceeds of assessments levied
without limitation as to rate or amount by the local agency upon
property in the local agency.
As part of its assurance under Section 15459, the
participating health institution shall agree to all of the following
actions:
(a) To advise each person seeking services at the participating
health institution's facility as to the person's potential
eligibility for Medi-Cal and Medicare benefits or benefits from other
governmental third-party payers.
(b) To make available to the authority and to any interested
person a list of physicians with staff privileges at the
participating health institution's facility, which includes all of
the following:
(1) Name.
(2) Specialty.
(3) Language spoken.
(4) Whether the physician takes Medi-Cal and Medicare patients.
(5) Business address and phone number.
(c) To inform in writing on a periodic basis all practitioners of
the healing arts having staff privileges in the participating health
institution's facility as to the existence of the facility's
community service obligation. The required notice to practitioners
shall contain a statement, as follows:
"This hospital has agreed to provide a community service and to
accept Medi-Cal and Medicare patients. The administration and
enforcement of this agreement is the responsibility of the California
Health Facilities Financing Authority and this facility."
(d) To post notices in the following form, which shall be
multilingual where the participating health institution serves a
multilingual community, in appropriate areas within the facility,
including, but not limited to, admissions offices, emergency rooms,
and business offices:
"This facility has agreed to make its services available to all
persons residing or employed in this area. This facility is
prohibited by law from discriminating against Medi-Cal and Medicare
patients. Should you believe you may be eligible for Medi-Cal or
Medicare, you should contact our business office (or designated
person or office) for assistance in applying. You should also contact
our business office (or designated person or office) if you are in
need of a physician to provide you with services at this facility. If
you believe that you have been refused services at this facility in
violation of the community service obligation you should inform
(designated person or office) and the California Health Facilities
Financing Authority."
The participating health institution shall provide copies of this
notice for posting to all welfare offices in the county where the
participating health institution's facility is located.
(e) For all facilities in areas, and of a type, not subject to
Medi-Cal contracting and for all participating health institution
which have negotiated in good faith to obtain a Medi-Cal contract but
were not awarded a contract by the California Medi-Cal Assistance
Commission, the authority shall make modifications to the
requirements contained in this section to reflect the absence of a
Medi-Cal contract. Nothing in this section relieves a hospital of its
obligations under Section 1317 of the Health and Safety Code.
If the participating health institution cannot demonstrate
that it meets the requirements of Sections 15459 and 15459.1, it may
nonetheless be eligible for financing through the issuance of
revenue bonds if it presents a plan that is satisfactory to the
authority which details the reasonable steps and timetables that the
borrower agrees to take to bring the facility into compliance with
these sections.
Each participating health institution shall make available
to the authority and to the public upon request an annual report
substantiating compliance with the requirements of Section 15459. The
annual report shall set forth sufficient information and
verification therefor to indicate the participating health
institution's compliance. The report shall include at least the
following:
(a) By category for inpatient admissions, emergency admission, and
where the facility has a separate identifiable outpatient service:
(1) The total number of patients receiving services.
(2) The total number of Medi-Cal patients served.
(3) The total number of Medicare patients served.
(4) The total number of patients who had no financial sponsor at
the time of service.
(5) The dollar volume of services provided to each patient
category listed in paragraphs (1), (2), and (3).
(b) Where appropriate, the actions taken pursuant to Section
15459.2 and the effect the actions have had on the data specified in
subdivision (a).
(c) Any other information which the authority may reasonably
require.
The remedies and sanctions available to the authority
against the participating health institution for failure to adhere to
the assurance given to the authority under Section 15459 shall
include all of the following:
(a) Rendering the participating health institution ineligible for
federal and state financial assistance under the Hill-Burton Program.
(b) Requiring a participating health institution that had
originally met the conditions of community service to submit a plan
that is satisfactory to the authority which details the reasonable
steps and timetables that the participating health institution agrees
to take to bring the facility back into compliance with the
assurances given to the authority.
(c) Referring the violation to the office of the Attorney General
of California for legal action authorized under existing law or other
remedy at law or equity, when a facility fails to carry out the
actions agreed to in a plan approved by the authority pursuant to
subdivision (b) of this section. However, the remedies obtainable by
the legal action shall not include withdrawal or cancellation of the
project or projects financed or to be financed through the issuance
of revenue bonds.
The State Department of Health Services, in establishing
reimbursement for services rendered under the Medi-Cal program by
facilities financed under this part, shall reflect those interest
savings allocable to Medi-Cal services to the extent feasible and in
a manner consistent with federal law.
Exclusively for the purpose of securing the financing of
projects or working capital pursuant to this part through the
issuance of revenue bonds, certificates of participation, or other
means, and notwithstanding any other provision of law, any city, city
and county, county, or local hospital district may issue bonds to
the authority or borrow money from the authority at the interest rate
or rates, with the maturity date or dates, payment, security,
default, remedy, and other terms as specified in the bonds of the
city, city and county, county, or local hospital district or a loan,
loan purchase, or other agreement between the authority and the city,
city and county, county, or hospital district, and the city, city
and county, county or hospital district may enter into any agreement
for liquidity or credit enhancement or any other agreement or
instrument that may be necessary or appropriate in connection with
any of the foregoing. This section provides a complete, additional,
and alternative method for performing the acts authorized by this
section, and the borrowing of money from the authority, and any
provisions for payment or security or any agreement for liquidity or
credit enhancement in connection with the borrowing of money pursuant
to this section need not comply with the requirements of any other
law applicable to borrowing by a city, county, city and county, or
hospital district.
Exclusively for the purpose of securing the financing of
projects pursuant to this part or through the issuance of revenue
bonds, certificates of participation, or other means, and
notwithstanding any other law, any city, city and county, county, or
hospital district may buy or lease health facilities from the
authority, and in connection therewith, sell or lease health
facilities to the authority, in each case with the installment
payment or rental provisions, term, payment, security, default,
remedy, and other terms or provisions as may be specified in the
installment sale, lease, or other agreement or agreements, between
the authority and the city, city and county, county, or hospital
district, and the city, city and county, county, or hospital district
may enter into any agreement for liquidity or credit enhancement it
may deem necessary or appropriate in connection therewith. This
section provides a complete, additional, and alternative method for
performing the acts authorized by this section, and any sale or lease
of health facilities to the authority, any purchase or lease of
health facilities from the authority, and any provisions for payment
and security or any agreement for liquidity or credit enhancement in
connection therewith, pursuant to this section, need not comply with
the requirements of any other law applicable to sale, purchase,
lease, pledge, encumbrance, or credit, as the case may be, by a city,
city and county, county, or hospital district.