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TexasHB 378889th Legislature Regular SessionHouse

Relating to the operations of municipal hospital authorities.

Sponsored By: Sam Harless, Tan Parker (Republican), David Spiller

Became Law

Special Districts & Authorities--HospitalBONDS

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Bill Overview

Analyzed Economic Effects

4 provisions identified: 3 benefits, 0 costs, 1 mixed.

Hospital assets can support community health

Beginning September 1, 2025, authorities can use available assets for community health after selling or closing a hospital. They must no longer own or operate a hospital, and their boards must find that projects benefit residents served. Uses include administrative offices, indigent care clinics, research centers, fitness centers, medical education, and other health care facilities. Authorities can also give direct or indirect financial help to nonprofits supporting hospitals, clinics, medical care, health education, wellness, or disease prevention. Other activities can support public health and residents’ general welfare, but no particular service is guaranteed.

Hospital authorities gain health project financing

Beginning September 1, 2025, authorities can issue revenue bonds for authorized purposes, even without owning or operating a hospital. They can also issue other notes for the expanded community health initiatives. Bonds can be repaid from pledged hospital income, hospital property or investment income, and authorized project, facility, or service income. Authority real or personal property can secure bonds through mortgages or deeds of trust; no new household tax or fee is imposed. The law also repeals subsections (d) through (g) of Section 262.034, which addressed financing and asset holding.

More small-town hospital authorities qualify

Beginning September 1, 2025, the small-municipality population limit for a special hospital authority rule rises from under 15,000 to under 30,000. Authorities also qualify geographically when located in a county with at least 2.4 million people. Under either path, they must have assets worth more than their outstanding bonds issued under Subchapter D. They must also not operate a hospital. This expands which authorities qualify, not eligibility for a household payment.

Hospital boards gain flexibility, restrict membership

Beginning September 1, 2025, Texas municipal hospital authorities can change board size by amending their creating ordinance. Bond resolutions or trust agreements can bar changes, and shrinking a board cannot shorten current directors’ terms. Boards can set director selection methods and terms through bond resolutions, agreements securing notes, or other board resolutions. Later changes require another board resolution, subject to legal exceptions and existing bond agreements. Directors appointed before bond issuance keep the terms governed by the applicable resolution or agreement. Municipalities appoint initial directors and any directors not chosen through the board’s selection method; initial terms cannot exceed two years. Participating municipalities get equal representation unless they agree otherwise. Authority employees cannot become directors; officers and employees of participating municipalities remain barred.

Sponsors & Cosponsors

Sponsors

  • Sam Harless

    House

  • Tan Parker

    Republican • Senate

  • David Spiller

    House

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

All Roll Calls

Yes: 252 • No: 45

Senate vote • 5/21/2025

Record vote

Yes: 0 • No: 0

Senate vote • 5/21/2025

Record vote

Yes: 0 • No: 0

House vote • 5/14/2025

Record vote

Yes: 118 • No: 23

House vote • 5/13/2025

Record vote

Yes: 118 • No: 22

Senate vote • Unknown

Committee vote: Local Government

Yes: 6 • No: 0

House vote • Unknown

Committee vote: Intergovernmental Affairs

Yes: 10 • No: 0

Actions Timeline

  1. Effective on 9/1/25

    6/20/2025House

  2. Filed without the Governor's signature

    6/20/2025House

  3. Sent to the Governor

    5/26/2025House

  4. Signed in the Senate

    5/25/2025Senate

  5. Signed in the House

    5/24/2025House

  6. Reported enrolled

    5/23/2025House

  7. Senate passage reported

    5/21/2025House

  8. Record vote

    5/21/2025Senate

  9. Passed

    5/21/2025Senate

  10. Read 3rd time

    5/21/2025Senate

  11. Record vote

    5/21/2025Senate

  12. Three day rule suspended

    5/21/2025Senate

  13. Vote recorded in Journal

    5/21/2025Senate

  14. Read 2nd time & passed to 3rd reading

    5/21/2025Senate

  15. Vote recorded in Journal

    5/21/2025Senate

  16. Rules suspended-Regular order of business

    5/21/2025Senate

  17. Placed on intent calendar

    5/21/2025Senate

  18. Committee report printed and distributed

    5/20/2025Senate

  19. Recommended for local & uncontested calendar

    5/20/2025Senate

  20. Reported favorably w/o amendments

    5/20/2025Senate

  21. Vote taken in committee

    5/19/2025Senate

  22. Testimony taken in committee

    5/19/2025Senate

  23. Considered in public hearing

    5/19/2025Senate

  24. Scheduled for public hearing on . . .

    5/19/2025Senate

  25. Referred to Local Government

    5/15/2025Senate

Bill Text

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