74th OREGON LEGISLATIVE ASSEMBLY--2007 Regular Session
 
NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .
 
LC 1642
 
                         Senate Bill 614
 
Sponsored by COMMITTEE ON EDUCATION AND GENERAL GOVERNMENT
 
 
                             SUMMARY
 
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
 
  Requires health care institutions and providers of hospital
facilities, except rural hospitals, to obtain certificate of need
in order to qualify to receive proceeds of public borrowing for
capital construction.
  Caps amount of bond proceeds Oregon Facilities Authority and
hospital authority may provide to nonprofit health care
institution or nonprofit provider of hospital facilities if
institution or provider has specified amount of cash on hand.
  Requires members of Oregon Facilities Authority to declare
actual or potential conflict of interest based on relationship
with nonprofit corporation.
  Requires members of board of directors of hospital authority to
file statement of economic interest and declare actual or
potential conflict of interest based on relationship with
nonprofit corporation.
 
                        A BILL FOR AN ACT
Relating to public borrowing for health care facilities; creating
  new provisions; and amending ORS 244.050, 289.100, 408.370,
  441.540 and 442.315.
Be It Enacted by the People of the State of Oregon:
  SECTION 1.  { + Section 2 of this 2007 Act is added to and made
a part of ORS chapter 289. + }
  SECTION 2.  { + (1) As used in this section:
  (a) 'Cash on hand' means cash and cash equivalents, short term
investments and current and noncurrent assets:
  (A) Including assets that are limited as to use; and
  (B) Excluding assets that:
  (i) Are property, plant and equipment, any of which are used
for health care operations;
  (ii) Are pension plan assets; or
  (iii) Constitute a reasonable amount of self-insurance assets.
  (b) 'Public financing' means the cumulative amount of revenue
bonds, except refunding bonds, issued under this chapter or
issued by an authority as defined in ORS 441.525.
  (2) The Oregon Facilities Authority may not provide public
financing to a nonprofit health care institution, or to a
combination of nonprofit health care institutions working
cooperatively, in an amount that exceeds $10 million in a
two-year period if, after excluding sufficient operating cash for
100 days of operations, the institution or institutions,
including all affiliated entities, have cash on hand that is more
than twice the amount of the net proceeds of revenue bonds that
the Oregon Facilities Authority and an authority as defined in
ORS 441.525 propose to issue in favor of the institution or
institutions.
  (3) A nonprofit health care institution may not avoid the
financing limit in subsection (2) of this section by parsing the
component or related portions of a project into separate
projects.
  (4) Except as provided in this section, a health care
institution must obtain a certificate of need to qualify to
receive public financing for a project under this chapter.
  (5) Subsection (4) of this section:
  (a) Applies to a health care institution, including a health
care institution that:
  (A) Provides basic health services; or
  (B) Is not otherwise required to obtain a certificate of need
under ORS 442.315.
  (b) Does not apply to a rural hospital that is not required to
obtain a certificate of need under ORS 442.315 (8). + }
  SECTION 3.  { + Section 4 of this 2007 Act is added to and made
a part of ORS 441.525 to 441.595. + }
  SECTION 4.  { + (1) As used in this section:
  (a) 'Cash on hand' means cash and cash equivalents, short term
investments and current and noncurrent assets:
  (A) Including assets that are limited as to use; and
  (B) Excluding assets that:
  (i) Are property, plant and equipment, any of which are used
for health care operations;
  (ii) Are pension plan assets; or
  (iii) Constitute a reasonable amount of self-insurance assets.
  (b) 'Provider' means a political subdivision of the state or a
private nonprofit corporation that provides hospital facilities.
  (c) 'Public financing' means the cumulative amount of revenue
bonds, except refunding bonds, issued under ORS chapter 289 or
issued by an authority.
  (2) An authority may not provide public financing to a
nonprofit corporation, or to a combination of nonprofit
corporations working cooperatively, in an amount that exceeds $10
million in a two-year period if, after excluding sufficient
operating cash for 100 days of operations, the corporation or
corporations, including all affiliated entities, have cash on
hand that is more than twice the amount of the net proceeds of
revenue bonds that the Oregon Facilities Authority and an
authority propose to issue in favor of the corporation or
corporations.
  (3) A nonprofit corporation may not avoid the financing limit
in subsection (2) of this section by parsing the component or
related portions of a hospital facility into separate projects.
  (4) Except as provided in this section, a provider must obtain
a certificate of need to qualify to receive public financing for
a hospital facility under ORS 441.525 to 441.595.
  (5) Subsection (4) of this section:
  (a) Applies to a provider, including a provider that:
  (A) Provides basic health services; or
  (B) Is not otherwise required to obtain a certificate of need
under ORS 442.315.
  (b) Does not apply to a rural hospital that is not required to
obtain a certificate of need under ORS 442.315 (8). + }
  SECTION 5. ORS 442.315 is amended to read:
  442.315. (1) Any new hospital or new skilled nursing or
intermediate care service or facility not excluded pursuant to
ORS 441.065 shall obtain a certificate of need from the
Department of Human Services prior to an offering or development.
 
 
  (2) The department shall adopt rules specifying criteria and
procedures for making decisions as to the need for the new
services or facilities.
  (3)(a) An applicant for a certificate of need shall apply to
the department on forms provided for this purpose by department
rule.
  (b) An applicant shall pay a fee prescribed as provided in this
section. Subject to the approval of the Oregon Department of
Administrative Services, the Department of Human Services shall
prescribe application fees, based on the complexity and scope of
the proposed project.
  (4) The Department of Human Services shall be the
decision-making authority for the purpose of certificates of
need.
  (5)(a) An applicant or any affected person who is dissatisfied
with the proposed decision of the department is entitled to an
informal hearing in the course of review and before a final
decision is rendered.
  (b) Following a final decision being rendered by the
department, an applicant or any affected person may request a
reconsideration hearing pursuant to ORS chapter 183.
  (c) In any proceeding brought by an affected person or an
applicant challenging a department decision under this
subsection, the department shall follow procedures consistent
with the provisions of ORS chapter 183 relating to a contested
case.
  (6) Once a certificate of need has been issued, it may not be
revoked or rescinded unless it was acquired by fraud or deceit.
However, if the department finds that a person is offering or
developing a project that is not within the scope of the
certificate of need, the department may limit the project as
specified in the issued certificate of need or reconsider the
application. A certificate of need is not transferable.
  (7) Nothing in this section applies to any hospital, skilled
nursing or intermediate care service or facility that seeks to
replace equipment with equipment of similar basic technological
function or an upgrade that improves the quality or
cost-effectiveness of the service provided. Any person acquiring
such replacement or upgrade shall file a letter of intent for the
project in accordance with the rules of the department if the
price of the replacement equipment or upgrade exceeds $1 million.
  (8) Except as required in subsection (1) of this section for a
new hospital or new skilled nursing or intermediate care service
or facility not operating as a Medicare swing bed program,
nothing in this section requires a rural hospital as defined in
ORS 442.470 (5)(a)(A) and (B) to obtain a certificate of need.
  (9) Nothing in this section applies to basic health services,
but basic health services do not include:
  (a) Magnetic resonance imaging scanners;
  (b) Positron emission tomography scanners;
  (c) Cardiac catheterization equipment;
  (d) Megavoltage radiation therapy equipment;
  (e) Extracorporeal shock wave lithotriptors;
  (f) Neonatal intensive care;
  (g) Burn care;
  (h) Trauma care;
  (i) Inpatient psychiatric services;
  (j) Inpatient chemical dependency services;
  (k) Inpatient rehabilitation services;
  (L) Open heart surgery; or
  (m) Organ transplant services.
  (10) In addition to any other remedy provided by law, whenever
it appears that any person is engaged in, or is about to engage
in, any acts that constitute a violation of this section, or any
rule or order issued by the department under this section, the
department may institute proceedings in the circuit courts to
enforce obedience to such statute, rule or order by injunction or
by other processes, mandatory or otherwise.
   { +  (11) A health care institution, as defined in ORS
289.005, that is not otherwise required to obtain a certificate
of need must obtain a certificate of need to qualify to receive
public financing for a project under ORS chapter 289 as provided
in section 2 of this 2007 Act.
  (12) A provider, as defined in section 4 of this 2007 Act, that
is not otherwise required to obtain a certificate of need must
obtain a certificate of need to qualify to receive public
financing for a health care facility under ORS 441.525 to 441.595
as provided in section 4 of this 2007 Act. + }
    { - (11) - }   { + (13) + } As used in this section, 'basic
health services' means health services offered in or through a
hospital licensed under ORS chapter 441, except skilled nursing
or intermediate care nursing facilities or services and those
services specified in subsection (9) of this section.
  SECTION 6. ORS 289.100 is amended to read:
  289.100. (1) There is created a body politic and corporate to
be known as the Oregon Facilities Authority. The authority is
constituted a public instrumentality, and the exercise by the
authority of the powers conferred by this chapter shall be
considered and held to be the performance of an essential public
function.
  (2) The authority shall consist of five members who shall be
residents of this state, not more than three of whom shall be
members of the same political party. The State Treasurer shall
appoint the members. At least one of the members shall be a
person knowledgeable in the field of state and municipal finance.
At least one of the members shall be a person knowledgeable in
the building construction field.
  (3) Upon the expiration of the term of any member, a successor
shall be appointed for a term of four years. The State Treasurer
shall fill any vacancy for the remainder of the unexpired term.
   { +  (4) Notwithstanding the exception for pecuniary benefit
or detriment described in ORS 244.020 (14)(c), a member is a
public official subject to the requirements of ORS chapter 244
based on an actual conflict of interest or a potential conflict
of interest arising out of the member's relationship with a
nonprofit corporation that is tax-exempt under section 501(c) of
the Internal Revenue Code, including employment with the
nonprofit corporation or a relationship with a foundation that
provides assistance to the nonprofit corporation. + }
  SECTION 7. ORS 441.540 is amended to read:
  441.540. (1) An authority shall be managed and controlled by a
board of directors, who shall be appointed by the governing body.
The directors may be removed for cause or at the will of the
governing body. The directors shall serve without compensation.
However, the authority may reimburse the directors for their
expenses incurred in the performance of their duties.
  (2) The board of directors shall adopt and may amend rules for
calling and conducting its meetings and carrying out its business
and may adopt an official seal. All decisions of the board shall
be by motion or resolution and shall be recorded in the board's
minute book which shall be a public record. A majority of the
board shall constitute a quorum for the transaction of business
and a majority thereof shall be sufficient for the passage of any
such motion or resolution.
  (3) The board may employ such employees and agents as it deems
appropriate and provide for their compensation.
   { +  (4) Notwithstanding the exception for pecuniary benefit
or detriment described in ORS 244.020 (14)(c), a director is a
public official subject to the requirements of ORS chapter 244
based on an actual conflict of interest or a potential conflict
of interest arising out of the director's relationship with a
nonprofit corporation that is tax-exempt under section 501(c) of
the Internal Revenue Code, including employment with the
nonprofit corporation or a relationship with a foundation that
provides assistance to the nonprofit corporation. + }
  SECTION 8. ORS 244.050 is amended to read:
  244.050. (1) On or before April 15 of each year the following
persons shall file with the Oregon Government Standards and
Practices Commission a verified statement of economic interest as
required under this chapter:
  (a) The Governor, Secretary of State, State Treasurer, Attorney
General, Commissioner of the Bureau of Labor and Industries,
Superintendent of Public Instruction, district attorneys and
members of the Legislative Assembly.
  (b) Any judicial officer, including justices of the peace and
municipal judges, except municipal judges in those cities where a
majority of the votes cast in the subject city in the 1974
general election was in opposition to the ballot measure provided
for in section 10, chapter 68, Oregon Laws 1974 (special
session), and except any pro tem judicial officer who does not
otherwise serve as a judicial officer.
  (c) Any candidate for an office designated in paragraph (a) or
(b) of this subsection.
  (d) The Deputy Attorney General.
  (e) The Legislative Administrator, the Legislative Counsel, the
Legislative Fiscal Officer, the Secretary of the Senate and the
Chief Clerk of the House of Representatives.
  (f) The Chancellor and Vice Chancellors of the Oregon
University System and the president and vice presidents, or their
administrative equivalents, in each institution under the
jurisdiction of the State Board of Higher Education.
  (g) The following state officers:
  (A) Adjutant General.
  (B) Director of Agriculture.
  (C) Manager of State Accident Insurance Fund Corporation.
  (D) Water Resources Director.
  (E) Director of Department of Environmental Quality.
  (F) Director of Oregon Department of Administrative Services.
  (G) State Fish and Wildlife Director.
  (H) State Forester.
  (I) State Geologist.
  (J) Director of Human Services.
  (K) Director of the Department of Consumer and Business
Services.
  (L) Director of the Department of State Lands.
  (M) State Librarian.
  (N) Administrator of Oregon Liquor Control Commission.
  (O) Superintendent of State Police.
  (P) Director of the Public Employees Retirement System.
  (Q) Director of Department of Revenue.
  (R) Director of Transportation.
  (S) Public Utility Commissioner.
  (T) Director of Veterans' Affairs.
  (U) Executive Director of Oregon Government Standards and
Practices Commission.
  (V) Director of the State Department of Energy.
  (W) Director and each assistant director of the Oregon State
Lottery.
  (h) Any assistant in the Governor's office other than personal
secretaries and clerical personnel.
  (i) Every elected city or county official except elected
officials in those cities or counties where a majority of votes
cast in the subject city or county in any election on the issue
of filing statements of economic interest under this chapter was
in opposition.
  (j) Every member of a city or county planning, zoning or
development commission except such members in those cities or
counties where a majority of votes cast in the subject city or
county at any election on the issue of filing statements of
economic interest under this chapter was in opposition to the
ballot measure provided for in section 10, chapter 68, Oregon
Laws 1974 (special session).
  (k) The chief executive officer of a city or county who
performs the duties of manager or principal administrator of the
city or county except such employees in those cities or counties
where a majority of votes cast in the subject city or county in
an election on the issue of filing statements of economic
interest under this chapter was in opposition.
  (L) Members of local government boundary commissions formed
under ORS 199.410 to 199.519.
  (m) Every member of a governing body of a metropolitan service
district and the executive officer thereof.
  (n) Each member of the board of directors of the State Accident
Insurance Fund Corporation.
  (o) The chief administrative officer and the financial officer
of each common and union high school district, education service
district and community college district.
  (p) Every member of the following state boards and commissions:
  (A) Board of Geologic and Mineral Industries.
  (B) Oregon Economic and Community Development Commission.
  (C) State Board of Education.
  (D) Environmental Quality Commission.
  (E) Fish and Wildlife Commission of the State of Oregon.
  (F) State Board of Forestry.
  (G) Oregon Government Standards and Practices Commission.
  (H) Oregon Health Policy Commission.
  (I) State Board of Higher Education.
  (J) Oregon Investment Council.
  (K) Land Conservation and Development Commission.
  (L) Oregon Liquor Control Commission.
  (M) Oregon Short Term Fund Board.
  (N) State Marine Board.
  (O) Mass transit district boards.
  (P) Energy Facility Siting Council.
  (Q) Board of Commissioners of the Port of Portland.
  (R) Employment Relations Board.
  (S) Public Employees Retirement Board.
  (T) Oregon Racing Commission.
  (U) Oregon Transportation Commission.
  (V) Wage and Hour Commission.
  (W) Water Resources Commission.
  (X) Workers' Compensation Board.
  (Y) Oregon Facilities Authority.
  (Z) Oregon State Lottery Commission.
  (AA) Pacific Northwest Electric Power and Conservation Planning
Council.
  (BB) Columbia River Gorge Commission.
  (CC) Oregon Health and Science University Board of Directors.
  (q) The following officers of the State Treasury:
  (A) Chief Deputy State Treasurer.
  (B) Executive Assistant to the State Treasurer.
  (C) Director of the Investment Division.
  (r) Every member of the board of commissioners of a port
governed by ORS 777.005 to 777.725 and 777.915 to 777.953.
   { +  (s) Every member of the board of directors of an
authority created under ORS 441.525 to 441.595. + }
  (2) By April 15 next after the date an appointment takes
effect, every appointed public official on a board or commission
listed in subsection (1) of this section shall file with the
commission a statement of economic interest as required under ORS
244.060, 244.070 and 244.090.
  (3) By April 15 next after the filing deadline for the primary
election, each candidate for elective public office described in
subsection (1) of this section shall file with the commission a
statement of economic interest as required under ORS 244.060,
244.070 and 244.090.
  (4) Within 30 days after the filing deadline for the general
election, each candidate for elective public office described in
subsection (1) of this section who was not a candidate in the
preceding primary election, or who was nominated for elective
public office described in subsection (1) of this section at the
preceding primary election by write-in votes, shall file with the
commission a statement of economic interest as required under ORS
244.060, 244.070 and 244.090.
  (5) The Legislative Assembly shall maintain a continuing review
of the operation of this chapter.
  (6) Subsections (1) to (5) of this section apply only to
persons who are incumbent, elected or appointed officials as of
April 15 and to persons who are candidates for office on April
15.  Those sections also apply to persons who do not become
candidates until 30 days after the filing deadline for the
statewide general election.
  (7)(a) Failure to file the statement required by this section
subjects a person to a civil penalty that may be imposed as
specified in ORS 183.745, but the enforcement of this subsection
does not require the Oregon Government Standards and Practices
Commission to follow the procedures in ORS 244.260 before finding
that a violation of this section has occurred.
  (b) Failure to file the required statement in timely fashion
shall be prima facie evidence of a violation of this section.
  (c) If within five days after the date on which the statement
is to be filed under this section the statement has not been
received by the commission, the commission shall notify the
public official and give the public official not less than 15
days to comply with the requirements of this section. If the
public official fails to comply by the date set by the
commission, the commission may impose a civil penalty of $5 for
each day the statement is late beyond the date fixed by the
commission. The maximum penalty that may be accrued under this
section is $1,000.
  (d) A civil penalty imposed under this subsection is in
addition to and not in lieu of sanctions that may be imposed
under ORS 244.380.
  SECTION 9. ORS 408.370 is amended to read:
  408.370. (1) In addition to the other uses for the Oregon
Housing Fund set forth in ORS 458.600 to 458.655, financial
support for an Oregon Veterans' Home is a permitted use of moneys
from the Oregon Housing Fund.
  (2) Notwithstanding ORS 442.315  { + (1) to (10) + }, 442.325
and 442.584, an Oregon Veterans' Home is not subject to any
certificate of need requirement but is otherwise subject to the
authority of the Health Resources Commission.
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