Citations Affected: IC 5-1.
Synopsis: Indiana health facility financing authority. Permits the
Indiana health facility financing authority to provide bond financing for
facilities outside Indiana if: (1) the borrower is an Indiana health care
provider or is owned or controlled by, affiliated with, or part of an
obligated group that includes an Indiana health care provider that
operates a substantial facility in Indiana; and (2) the financing for the
out-of-state facility also includes an Indiana facility. Permits the
authority to conduct certain public hearings as required by federal law
for issuance of the bonds. Provides for indemnification of the authority
and the state with respect to any legal action arising out of issuance of
the bonds.
Effective: Upon passage.
January 10, 2000, read first time and referred to Committee on Public Health.
January 26, 2000, amended, reported _ Do Pass.
A BILL FOR AN ACT to amend the Indiana Code concerning state
and local administration.
SECTION 1. IC 5-1-16-1, AS AMENDED BY P.L.272-1999,
SECTION 3, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 1. As used in this chapter:
"Authority" refers to the Indiana health facility financing authority.
"Bonds" includes bonds, refunding bonds, notes, interim
certificates, bond anticipation notes, and other evidences of
indebtedness of the authority, issued under this chapter.
"Building" or "buildings" or similar words mean any building or part
of a building or addition to a building for health care purposes. The
term includes the site for the building (if a site is to be acquired),
equipment, heating facilities, sewage disposal facilities, landscaping,
walks, drives, parking facilities, and other structures, facilities,
appurtenances, materials, and supplies that may be considered
necessary to render a building suitable for use and occupancy for health
care purposes.
"Cost" includes the following:
(1) The cost and the incidental and related costs of the
acquisition, repair, restoration, reconditioning, refinancing, or
installation of health facility property.
(2) The cost of any property interest in health facility property,
including an option to purchase a leasehold interest.
(3) The cost of constructing health facility property, or an addition
to health facility property, acquiring health facility property, or
remodeling health facility property.
(4) The cost of architectural, engineering, legal, trustee,
underwriting, and related services; the cost of the preparation of
plans, specifications, studies, surveys, and estimates of cost and
of revenue; and all other expenses necessary or incident to
planning, providing, or determining the need for or the feasibility
and practicability of health facility property.
(5) The cost of financing charges, including premiums or
prepayment penalties and interest accrued during the construction
of health facility property or before the acquisition and
installation or refinancing of such health facility property for up
to two (2) years after such construction, acquisition, and
installation or refinancing and startup costs related to health
facility property for up to two (2) years after such construction,
acquisition, and installation or refinancing.
(6) The costs paid or incurred in connection with the financing of
health facility property, including out-of-pocket expenses, the cost
of any policy of insurance; the cost of printing, engraving, and
reproduction services; and the cost of the initial or acceptance fee
of any trustee or paying agent.
(7) The costs of the authority, incurred in connection with
providing health facility property, including reasonable sums to
reimburse the authority for time spent by its agents or employees
in providing and financing health facility property.
(8) The cost paid or incurred for the administration of any
program for the purchase or lease of or the making of loans for
health facility property, by the authority and any program for the
sale or lease of or making of loans for health facility property to
any participating provider.
"County" means any county in the state that owns and operates a
county hospital.
"Health facility property" means any tangible or intangible property
or asset owned or used by a participating provider and which:
(1) is determined by the authority to be necessary or helpful,
directly or indirectly, to provide:
(A) health care;
which:
(1) is located in Indiana or outside Indiana;
(2) contracts with the authority for the financing or
refinancing of, or the lease or other acquisition of, health
facility property that is located:
(A) in Indiana; or
(B) outside Indiana, if the financing, refinancing, lease, or
other acquisition also includes a substantial component, as
determined by the authority, for the benefit of a health
facility or facilities located in Indiana;
(3) is:
(A) licensed under IC 12-25, IC 16-21, or IC 16-28, or
corresponding laws of the state in which the property is
located;
(B) a regional blood center;
(C) a community mental health center or community mental
retardation and other developmental disabilities center (as
defined in IC 12-7-2-38 and IC 12-7-2-39 or corresponding
provisions of laws of the state in which the property is
located);
(D) an entity that:
(i) contracts with the division of disability, aging, and
rehabilitative services or the division of mental health to
provide the program described in IC 12-11-1.1-1(e) or
IC 12-22-2; or
(ii) provides a similar program under the laws of the
state in which the entity is located;
(E) a vocational rehabilitation center established under
IC 12-12-1-4(1) or corresponding provisions of the laws of
the state in which the property is located;
(F) the owner or operator of a facility that is utilized, directly
or indirectly, to provide health care, habilitation, rehabilitation,
therapeutic services, medical research, the training or teaching
of health care personnel, or any related supporting services, or
of a residential facility for the physically, mentally, or
emotionally disabled, physically or mentally ill, or the elderly;
(G) a licensed child caring institution providing residential
care described in IC 12-7-2-29(1) or corresponding
provisions of the laws of the state in which the property is
located;
(H) an integrated health care system between or among
providers, a health care purchasing alliance, a health insurer
or third party administrator that is a participant in an integrated
health care system, a health maintenance or preferred provider
organization, or a foundation that supports a health care
provider; or
(I) an individual, a business entity, or a governmental entity
that owns an equity or membership interest in any of the
organizations described in clauses (A) through (H); and
(2) under this chapter, contracts with the authority for the
financing or refinancing of, or the lease or other acquisition of,
health facility property.
(4) in the case of a person, corporation, municipal
corporation, political subdivision, or other entity located
outside Indiana, is owned or controlled by, under common
control with, affiliated with, or part of an obligated group that
includes an entity that provides one (1) or more of the
following services or facilities in Indiana:
(A) A facility that provides:
(i) health care;
(ii) habilitation, rehabilitation, or therapeutic services;
(iii) medical research;
(iv) training or teaching of health care personnel; or
(v) any related supporting services.
(B) A residential facility for:
(i) the physically, mentally, or emotionally disabled;
(ii) the physically or mentally ill; or
(iii) the elderly.
(C) A child caring institution providing residential care
described in IC 12-7-2-29(1).
"Regional blood center" means a nonprofit corporation or
corporation created under 36 U.S.C. 1 that:
(1) is:
(A) accredited by the American Association of Blood Banks;
or
(B) registered or licensed by the Food and Drug
Administration of the Department of Health and Human
Services; and
(2) owns and operates a health facility that is primarily engaged
in:
(A) drawing, testing, processing, and storing human blood and
providing blood units or components to Indiana hospitals; or
(B) harvesting, testing, typing, processing, and storing human
body tissue and providing this tissue to Indiana hospitals.
and assets.
(20) To the extent permitted under its contract with the holders of
bonds of the authority, consent to any modification with respect
to the rate of interest, time, and payment of any installment of
principal or interest, or any other term of any contract, loan, loan
note, loan note commitment, contract, lease, or agreement of any
kind to which the authority is a party.
(21) To charge to and apportion among participating providers its
administrative costs and expenses incurred in the exercise of the
powers and duties conferred by this chapter.
(22) Except as otherwise provided in a trust agreement or bond
resolution securing bonds of the authority, to invest any funds not
needed for immediate disbursement, including any funds held in
reserve, in such indebtedness or obligations designated by the
authority for investments of its funds held under this chapter.
(23) To collect fees and charges, as the authority determines to be
reasonable, in connection with its loans, leases, sales, advances,
insurance, commitments, and servicing.
(24) To cooperate with and exchange services, personnel, and
information with any federal, state, or local governmental agency.
(25) To sell, at public or private sale, with or without public
bidding, any loan or other obligation held by the authority.
(26) To assist, coordinate, and participate with other issuers
of tax exempt bonds and public officials in other states in
connection with financings or refinancings on behalf of
multiple state health facilities. Assistance, coordination, and
participation provided under this subdivision may include
conducting any hearings required by state or federal law in
order for bonds to be issued by public officials in other states
if part of the proceeds of the bonds will be used by
participating providers in Indiana. Any assistance,
coordination, or participation provided under this subsection
is given with the understanding that the issuers of tax exempt
bonds or borrowers will agree to indemnify and hold harmless
the state of Indiana and the authority and their officers,
agents, and employees from all claims and liability arising
from any action against the state of Indiana or the authority
relating to the bonds.
(b) No part of the revenues or assets of the authority may inure to
the benefit of or be distributable to its members or officers or other
private persons. Any net earnings of the authority beyond that
necessary for retirement of authority indebtedness or to implement the
public purposes of this chapter inure to the benefit of the state. Upon
termination or dissolution, all rights and properties of the authority pass
to and are vested in the state, subject to the rights of lienholders and
other creditors.
SECTION 3. IC 5-1-16-15 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 15. The authority
may initiate a program of providing health facility property to be
operated by participating providers in health facilities. in Indiana. In
furtherance of this objective, the authority may also:
(1) establish eligibility standards for participating providers,
without complying with IC 4-22-2; however, these standards have
the force of law if the standards are adopted after a public hearing
for which notice has been published in a newspaper published in
the city of Indianapolis, at least ten (10) days in advance of the
hearing;
(2) contract with any entity securing the payment of bonds under
section 13(a)(9) and (10) 13(a)(10) of this chapter, authorizing
the entity to approve the participating providers that can finance
or refinance health facility property with proceeds from the bond
issue secured by that entity;
(3) lease to a participating provider specific items of health
facility property upon terms and conditions that the authority
considers proper, to charge and collect rents therefor, to terminate
any such lease upon the failure of the lessee to comply with any
of its obligations under the lease or otherwise as the lease
provides, to include in any such lease provisions that the lessee
has the options to renew the term of the lease for such periods and
at such rents as may be determined by the authority or to purchase
any or all of the health facility property to which the lease applies;
(4) loan to a participating provider under an installment purchase
contract or loan agreement money to finance, reimburse, or
refinance the cost of specific items of health facility property and
to take back a secured or unsecured promissory note evidencing
such a loan and a security interest in the health facility property
financed or refinanced with such loan, upon such terms and
conditions as the authority considers proper;
(5) sell or otherwise dispose of any unneeded or obsolete health
facility property under terms and conditions as determined by the
authority;
(6) maintain, repair, replace, and otherwise improve or cause to
be maintained, repaired, replaced, and otherwise improved any
health facility property owned by the authority;