Amended in Assembly April 29, 2014

Amended in Assembly March 28, 2014

California Legislature—2013–14 Regular Session

Assembly Bill No. 2546

Introduced by Assembly Member Salas

February 21, 2014

An act to add Chapter begin delete 3.5 (commencing with Section 101800) end delete begin insert 5.5 (commencing with Section 101852) end insert to Part 4 of Division 101 of the Health and Safety Code, relating to public health.

LEGISLATIVE COUNSEL’S DIGEST

AB 2546, as amended, Salas. Kern County Hospital Authority.

Existing law authorizes the board of supervisors of certain counties to establish a hospital authority for the management, administration, and control of certain medical facilities.

This bill would authorize the board of supervisors of the County of Kern to establish begin insert , by ordinance, end insert the Kern County Hospital Authority begin delete by reaching an agreement with at least one health care facility and adopting an ordinance. end delete begin insert to manage, administer, and control the Kern Medical Center and other health care facilities, as defined. The bill would prohibit establishing the hospital authority until the medical center affiliates or consolidates with at least one other health care facility, as specified. The bill would grant to the authority the duties, privileges, immunities, rights, liabilities, and limitations of a local unit of government within the state. The bill would specify that the transfer to the authority of the management, administration, and control of the medical center and another health facility does not affect the eligibility of the county or the governing board of another health care facility for, but authorizes the authority to participate in and receive, various sources of funding, as specified, including various Medi-Cal programs. end insert

begin insert

This bill would provide various protections for the benefits of the permanent employees of the medical center, subject to certain conditions, and would authorize the authority to contract with the Public Employees’ Retirement System, as specified.

end insert

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

begin insert

begin insert SECTION 1. end insert   

end insert

begin insert Chapter 5.5 (commencing with Section 101852)
is added to Part 4 of Division 101 of the end insert begin insert Health and Safety Code end insert begin insert ,
to read: end insert

begin insert

 

Chapter   begin insert 5.5. end insert Kern County Hospital Authority

 

Article begin insert 1. end insert   General Provisions

 

begin insert 101852. end insert   

(a) This chapter shall be known and may be cited as
the Kern County Hospital Authority Act.

(b) The Legislature finds and declares all of the following:

(1) Kern Medical Center, currently a constituent department of
the County of Kern, is a designated public hospital, as defined in
subdivision (d) of Section 14166.1 of the Welfare and Institutions
Code, and a critical component of the state’s health care safety
net.

(2) Because there is no general law under which this public
hospital authority could be formed for these purposes, the adoption
of a special act and formation of a special authority by the
Legislature are required.

begin insert 101852.1. end insert   

For purposes of this chapter, the following
definitions shall apply:

(a) “Authority” means the Kern County Hospital Authority
established pursuant to this chapter.

(b) “Board of supervisors” means the Board of Supervisors of
the County of Kern.

(c) “Board of trustees” means the governing body of the
authority.

(d) “County” means the County of Kern.

(e) “Governing board” means the governing body of any other
health care facility, as defined in subdivision (g).

(f) “Medical center” means the Kern Medical Center and
related public health care programs, facilities, care organizations,
and delivery systems that exist or are established by the board of
trustees.

(g) “Other health care facility” or “other health care facilities”
means one or more health care facilities, districts, or systems in
the County of Kern, including, but not limited to, general acute
care hospitals, public hospital districts, and related health care
programs, facilities, care organizations, and delivery systems, but
does not include the medical center.

 

Article begin insert 2. end insert   Establishment of the Kern County Hospital Authority

 

begin insert 101852.2. end insert   

(a) Pursuant to this chapter, the board of
supervisors may establish, subject to the limitations of paragraph
(1) of subdivision (c), the Kern County Hospital Authority, which
is, for all purposes, a public entity separate and apart from the
county and any other public entity. The authority established
pursuant to this chapter shall file the statement required by Section
53051 of the Government Code, and is a public entity for purposes
of Division 3.6 (commencing with Section 810) of Title 1 of the
Government Code.

(b) (1) The purpose of the authority shall be to do all of the
following:

(A) Provide management, administration, and other controls,
consistent with this chapter, for the medical center to continue to
serve as a designated public hospital and ensure the viability of
the health care safety net in the county in a manner consistent with
the county’s requirements under Section 17000 of the Welfare and
Institutions Code.

(B) Provide management, administration, and other controls
for the continued operation of one or more other health care
facilities that may be affiliated or consolidated with the medical
center pursuant to this chapter.

(2) Subject to the requirements of this chapter, the authority
shall be charged with the management, administration, and control
of the medical center, other health care facilities, and related
services and facilities.

(c) (1) Except as specifically set forth in this chapter, the
authority shall not be established, transact business, exercise
powers, or undertake duties and responsibilities pursuant to this
chapter until an agreement is reached to affiliate or consolidate
the medical center with at least one other health care facility as
set forth in this subdivision. In order for the authority to be
established, transact any business, exercise its powers, or
undertake its duties and responsibilities, the board of supervisors
and at least one governing board shall reach agreement, on terms
and conditions satisfactory to the parties, regarding the affiliation
or consolidation. This agreement may include, but is not limited
to, a transfer of the following:

(A) Real and personal property and assets and liabilities from
the county and the other health care facility to the authority.

(B) Employees from the county and the other health care facility
to the authority.

(C) Maintenance, operation, and management or ownership of
the medical center, in accordance with Section 14000.2 of the
Welfare and Institutions Code.

(D) Maintenance, operation, and management or ownership of
the other health care facility.

(E) Other matters that the board of supervisors and the
governing board deem necessary or appropriate.

(2) If the board of supervisors and the governing board reach
an agreement on the matters set forth in this subdivision, the terms
and conditions of the agreement shall be binding upon the
authority. After the agreement is reached, the board of supervisors
shall adopt an ordinance to establish the authority and authorize
the authority to exercise the powers and duties pursuant to this
chapter, and the board of supervisors and the governing board
shall appoint a board of trustees as set forth in Section 101852.4.
The agreement set forth in this section may be amended from time
to time upon the mutual consent of the authority and the governing
board or the board of supervisors, or both, as appropriate.

(3) (A) The agreement shall provide that upon the effective date
of the ordinance described in paragraph (2), the authority shall
take any actions necessary so that the county has no continuing
financial obligation or responsibility with respect to the authority
or its operations.

(B) The authority’s funds shall not remain or be kept on deposit
with the county, or otherwise be in the custody or control of the
county, and the authority shall not be permitted to deposit funds
with the county, including within the county’s treasury investment
pool.

(d) An agreement concerning the transfer of personnel shall
include a transition plan that requires all the following:

(1) Ongoing communication to employees and recognized
employee organizations regarding the impact of the transition on
existing medical center and other health care facility employees
and employee classifications.

(2) Meeting and conferring by the county and the other health
care facility with affected employee bargaining units on both of
the following issues:

(A) A timeframe for which the transfer of personnel shall occur.

(B) A specified period of time during which employees of the
county affected by the establishment of the authority may elect to
be considered for appointment to vacant positions, and exercise
reinstatement rights, for which they are qualified and eligible. An
employee who first elects to remain with the county, but who
subsequently seeks employment with the authority within 30 days
of this election, shall be subject to the requirements of this article.

(3) Acknowledgment that the authority, to the extent permitted
by federal law, shall be bound by the terms of any memoranda of
understanding executed between the county and its exclusive
employee representatives that is or will be in effect as of the date
the county adopts the ordinance pursuant to this article. Subsequent
memoranda of understanding are subject to approval only by the
authority.

(e) (1) Notwithstanding any other provision of this chapter,
and whether or not accompanied by a change in licensing, an
agreement for the maintenance, operation, and management or
ownership of the medical center does not relieve the county of the
ultimate responsibility for indigent care pursuant to Section
14000.2 of the Welfare and Institutions Code.

(2) An agreement for the maintenance, operation, and
management or ownership of the medical center shall conform to
the following requirements:

(A) Shall comply with Section 14000.2 of the Welfare and
Institutions Code.

(B) May be made upon the terms and conditions that the board
of supervisors and governing board may mutually agree, including
those terms and conditions found necessary by the board of
supervisors to ensure that the transfer of the medical center shall
constitute an ongoing benefit to the county and its residents.

(C) Shall provide that the county shall ensure that any
applicable requirements of Section 1442.5 are met.

(3) An agreement for the maintenance, operation, and
management or ownership of the other health care facility may be
made upon the terms and conditions that the board of supervisors
and the governing board may mutually agree, including those
terms and conditions found necessary by the governing board to
ensure that the transfer shall constitute an ongoing benefit to the
other health care facility and its constituents.

(f) The authority is not subject to the jurisdiction of a local
agency formation commission pursuant to the
Cortese-Knox-Hertzberg Local Government Reorganization Act
of 2000 (Division 3 (commencing with Section 56000) of Title 5
of the Government Code), or any successor statute.

begin insert 101852.3. end insert   

Upon an agreement between the authority and each
affected employee bargaining unit:

(a) Permanent employees of the medical center on the effective
date of affiliation shall be deemed qualified for employment or
retention and no other qualifications shall be required.
Probationary employees on the effective date of affiliation shall
retain their probationary status and rights and shall not be deemed
to have transferred so as to require serving a new probationary
period.

(b) Employment seniority of an employee of the medical center
on the effective date of affiliation shall be counted toward seniority
in the authority. The authority shall provide for the maintenance
of benefits that accompany seniority, including, but not limited to,
preference in vacations and scheduling, when applicable. All time
served in the same, equivalent, or higher classification shall be
counted toward classification seniority.

(c) The implementation of this chapter shall not be a cause for
the modification of the level of medical center employment benefits.
Upon consolidation or affiliation of the medical center with at
least one other health care facility, employees who serve or work
for the medical center immediately prior to the implementation of
this chapter shall retain their existing or equivalent classifications
and job descriptions upon transfer to the authority, comparable
pension benefits, and at least their existing salaries and other
benefits that include, but are not limited to, accrued and unused
vacation, sick leave, personal leave, health care, retiree health
benefits, and deferred compensation plans.

(d) To the extent permitted by federal law, the authority may
contract with the Public Employees’ Retirement System, consistent
with the requirements of Section 20508 and other applicable
provisions of Part 3 (commencing with Section 20000) of Division
5 of Title 2 of the Government Code, for the purpose of providing
membership in the Public Employees’ Retirement System for
authority employees. If the authority contracts with the Public
Employees’ Retirement System, the authority, to the extent
permitted by federal law, shall provide for the continued
membership of medical center employees in the Public Employees’
Retirement System. If permitted under federal law, the authority
and the employees’ exclusive representatives may mutually agree
to terminate any contract that the authority enters into with the
Public Employees’ Retirement System, and mutually agree to an
alternative pension plan.

(e) Except as provided in the transfer agreement described in
subdivision (d) of Section 101852.2, subdivision (m) of Section
101852.5, and this section, this chapter does not prohibit the
authority from determining the number of employees, the number
of full-time equivalent positions, job descriptions, the nature and
extent of classified employment positions, and salaries of
employees.

 

Article begin insert 3. end insert   Board of Trustees

 

begin insert 101852.4. end insert   

(a) The authority shall be governed by a board of
trustees. The trustees shall reflect both the expertise necessary to
maximize the quality and scope of care at the medical center and
the other health care facility in a fiscally responsible manner and
the communities of interest that the medical center and the other
health care facility serve. The board of trustees shall have the
responsibility to operate the medical center and the other health
care facility in a manner that ensures the provision of appropriate,
quality, and cost-effective medical care through the development
of innovative delivery systems, care arrangements, and contractual
agreements that provide access to affordable, high-quality health
care services.

(b) (1) The board of trustees shall consist of the following nine
members:

(A) Three trustees appointed for two-year terms, of which the
governing board shall appoint two and the board of supervisors
shall appoint one.

(B) Three trustees appointed for three-year terms, of which the
governing board shall appoint one and the board of supervisors
shall appoint two.

(C) Three trustees appointed for four-year terms, of which the
governing board shall appoint one and the board of supervisors
shall appoint two.

(2) After the board of trustees is appointed, the governing board
and board of supervisors shall continue to make appointments to
those trustee positions for which they each made initial
appointments. The board of supervisors and the governing board
may each remove their respective appointees, upon a majority
vote, only for good cause. If the governing board ceases to exist
at any time, the appointing authority set forth in this subdivision
shall be exercised solely by the board of supervisors. If a vacancy
exists for any reason on the board of trustees, the appointing
authority for that trustee shall make an appointment to fill out the
remainder of the term of the vacant trustee position.

(3) Notwithstanding paragraphs (1) and (2), either during or
after the formation of the authority, the board of supervisors and
each governing board that has appointing authority may modify
the number, length of terms, and appointing authority of the board
of trustees by means of the agreement entered into pursuant to
subdivision (c) of Section 101852.2 or amendment to the
agreement, or both, by the county and the governing board that
participated in the formation of the authority, if in existence after
this formation, and the governing board of any other health care
facility that becomes affiliated or merged with the authority, if the
following conditions are met:

(A) The board of trustees consists of at least five members.

(B) The board of trustees includes appointees of the board of
supervisors and each existing governing board. If no governing
board exists, the board of trustees and the board of supervisors,
acting as the appointing authority pursuant to paragraph (2), may
agree to modify the number or length of terms of the board of
trustees.

(c) The board of trustees shall adopt bylaws for the authority
that, among other things, shall specify the officers of the board of
trustees, the time, place, and conduct of meetings, and other
matters that the board of trustees deems necessary or appropriate
to conduct the authority’s activities. The bylaws shall be operative
upon approval by a majority vote of the board of trustees, but may
be amended, from time to time, by a majority vote of the board of
trustees.

(d) The board of trustees created and appointed pursuant to
this chapter is a duly constituted governing body of a general acute
care hospital.

 

Article begin insert 4. end insert   Powers and Duties of the Authority

 

begin insert 101852.5. end insert   

(a) The authority, in addition to any other powers
granted to the authority pursuant to this chapter, shall have the
following powers:

(1) To have the duties, privileges, immunities, rights, liabilities,
and limitations of a local unit of government within the state.

(2) To have perpetual existence.

(3) To adopt, have, and use a seal, and to alter it at its pleasure.

(4) To sue and be sued in the name of the authority in all actions
and proceedings in all courts and tribunals of competent
jurisdiction.

(5) To purchase, lease, trade, exchange, or otherwise acquire,
maintain, hold, improve, mortgage, lease, sell, and dispose of real
and personal property of any kind necessary or convenient to
perform its functions and fully exercise its powers.

(6) To appoint and employ a chief executive officer and other
officers and employees that may be necessary or appropriate,
including legal counsel, to establish their compensation, provide
for their health, retirement, and other employment benefits, and
to define the power and duties of officers and employees.

(7) To pursue its own credit rating.

(8) To enter into a contract or agreement consistent with this
chapter or the laws of this state, and to authorize the chief
executive officer to enter into contracts, execute all instruments,
and do all things necessary or convenient in the exercise of the
powers granted in this chapter.

(9) To purchase supplies, equipment, materials, property, and
services.

(10) To establish policies relating to its purposes.

(11) To acquire or contract to acquire, rights-of-way, easements,
privileges, and property, and to construct, equip, maintain, and
operate any and all works or improvements wherever located that
are necessary, convenient, or proper to carry out any of the
provisions, objects, or purposes of this chapter, and to complete,
extend, add to, repair, or otherwise improve any works or
improvements acquired by it.

(12) To contract for and to accept gifts, grants, and loans of
funds, property, or other aid in any form from the federal
government, the state, a state agency, or other source, or
combination thereof, and to comply, subject to this chapter, with
the terms and conditions thereof.

(13) To invest surplus money in its own treasury, manage
investments, and engage third-party investment managers, in
accordance with state law.

(14) To arrange for guarantees or insurance of its bonds, notes,
or other obligations by the federal or state government or by a
private insurer, and to pay the premiums thereof.

(15) To engage in managed care contracting, joint ventures,
affiliations with other health care facilities, other health care
providers and payers, management agreements, or to participate
in alliances, purchasing consortia, health insurance pools,
accountable care organizations, alternative delivery systems, or
other cooperative arrangements, with any public or private entity.

(16) To enter into joint powers agreements pursuant to Chapter
5 (commencing with Section 6500) of Division 7 of Title 1 of the
Government Code.

(17) To establish nonprofit, for profit, or other entities necessary
to carry out the duties of the authority.

(18) To elect to transfer funds to the state and incur certified
public expenditures in support of the Medi-Cal program and other
programs for which federal financial participation is available.

(19) To use a computerized management information system,
including an electronic health records system, in connection with
the administration of its facilities.

(20) To contract with the county for the provision of indigent
care services on behalf of the county. The contract shall specify
that county policies consistent with the county’s obligations under
Section 17000 of the Welfare and Institutions Code shall be
applicable. Notwithstanding any other provision of this chapter,
the authority shall not undertake any of the county’s obligations
under Section 17000 of the Welfare and Institutions Code, nor
shall the authority have an entitlement to receive any revenue for
the discharge of the county’s obligations, without a written
agreement with the county.

(21) To engage in other activities that may be in the best
interests of the authority and the persons served by the authority,
as determined by the board of trustees, in order to respond to
changes in the health care industry.

(b) The authority shall conform to the following requirements:

(1) Be a government entity separate and apart for all purposes
from the county and any other public entity, and shall not be
considered to be an agency, division, or department of the county
or any other public entity. The authority shall not be governed by,
or subject to, the policies or operational rules of the county or any
other public entity.

(2) Be subject to state and federal taxation laws that are
applicable to public entities generally, except that the authority
may, to the extent permitted by federal law, apply for an exemption
from social security taxation if there is a mutual agreement with
the exclusive representatives of the affected employees.

(3) Comply with the Meyers-Milias-Brown Act (Chapter 10
(commencing with Section 3500) of Division 4 of Title 1 of the
Government Code), the Public Records Act (Chapter 3.5
(commencing with Section 6250) of Division 7 of Title 1 of the
Government Code), and the Ralph M. Brown Act (Chapter 10
(commencing with Section 3500) of Division 4 of Title 1 of the
Government Code).

(4) Carry professional and general liability insurance or
programs to the extent sufficient to cover its activities.

(5) Comply with the requirements of Sections 53260 and 53261
of the Government Code.

(6) Meet all local, state, and federal data reporting
requirements.

(c) Open sessions of the authority shall constitute official
proceedings authorized by law within the meaning of Section 47
of the Civil Code. The privileges set forth in that section with
respect to official proceedings shall apply to open sessions of the
authority.

(d) The authority shall be a public agency for purposes of
eligibility with respect to grants and other funding and loan
guarantee programs. Contributions to the authority shall be tax
deductible to the extent permitted by state and federal law.
Nonproprietary income of the authority shall be exempt from state
income taxation.

(e) The authority shall not be a “person” subject to suit under
the Cartwright Act (Chapter 2 (commencing with Section 16700)
of Part 2 of Division 7 of the Business and Professions Code).

(f) The statutory authority of a board of supervisors to prescribe
rules that authorize a county hospital to integrate its services with
those of other providers into a system of community service that
offers free choice of hospitals to those requiring hospital care, as
set forth in Section 14000.2 of the Welfare and Institutions Code,
shall apply to the authority and the board of trustees.

(g) Unless otherwise agreed to by the authority and the board
of supervisors, or the authority and a governing board, an
obligation of the authority, statutory, contractual, or otherwise,
shall be the obligation solely of the authority and shall not be the
obligation of the county or any other entity, and any contract
executed by and between the county and the authority, or any other
entity and the authority, shall contain a provision that liabilities
or obligations of the authority with respect to its activities pursuant
to the contract shall be the liabilities or obligations of the authority
and shall not be or become the liabilities or obligations of the
county or the other entity, respectively.

(h) An obligation of the authority, statutory, contractual, or
otherwise, shall be the obligation solely of the authority and shall
not be the obligation of the state.

(i) In the event of a change of license ownership, the board of
trustees shall comply with the obligations of governing bodies of
general acute care hospitals generally as set forth in Section 70701
of Title 22 of the California Code of Regulations, as currently
written or subsequently amended, as well as the terms and
conditions of the license. The authority shall be the responsible
party with respect to compliance with these obligations, terms,
and conditions.

(j) (1) Provisions of the Evidence Code, the Government Code,
including the Public Records Act (Chapter 3.5 (commencing with
Section 6250) of Division 7 of Title 1 of the Government Code),
the Civil Code, the Business and Professions Code, and other
applicable law pertaining to the confidentiality of peer review
activities of peer review bodies shall apply to the peer review
activities of the authority. Peer review proceedings shall constitute
an official proceeding authorized by law within the meaning of
Section 47 of the Civil Code and those privileges set forth in that
section with respect to official proceedings shall apply to peer
review proceedings of the authority. If the authority is required
by law or contractual obligation to submit to the state or federal
government peer review information or information relevant to
the credentialing of a participating provider, that submission shall
not constitute a waiver of confidentiality. The laws pertaining to
the confidentiality of peer review activities shall be together
construed as extending, to the extent permitted by law, the
maximum degree of protection of confidentiality.

(2) Notwithstanding any other law, Section 1461 shall apply to
hearings on reports of hospital medical audit or quality assurance
committees.

(k) (1) Transfer by the county to the authority, or by the
governing board to the authority, of the maintenance, operation,
and management or ownership of the medical center or the other
health care facility, respectively, whether or not the transfer
includes the surrendering by the county or the governing board
of an existing general acute care hospital license and
corresponding application for a change of ownership of the license,
shall not affect the eligibility of the county or the governing board
to undertake, and shall authorize the authority, subject to
applicable requirements, to do, any of the following:

(A) With the written consent of the county, participate in and
receive allocations pursuant to the California Health Care for
Indigents Program pursuant to Chapter 5 (commencing with
Section 16940) of Part 4.7 of Division 9 of the Welfare and
Institutions Code, or similar programs, as may be identified or
earmarked by the county for indigent health care services of the
type provided by the medical center.

(B) With the written consent of the county, participate in and
receive allocations of local revenue fund amounts provided
pursuant to Chapter 6 (commencing with Section 17600) of Part
5 of Division 9 of the Welfare and Institutions Code as may be
identified or earmarked by the county for indigent health care
services of the type provided by the medical center.

(C) Participate in the financing of, and receive, Medicaid
disproportionate share hospital payments available to a county
hospital or designated public hospital, or any other successor or
modified payment or funding that is intended to assist hospitals
that serve a disproportionate share of low-income patients with
special needs. The allocation of Medicaid disproportionate share
hospital payments shall be made in consultation with the State
Department of Health Care Services and other designated safety
net hospitals.

(D) Participate in the financing of, and receive, Medi-Cal
supplemental reimbursements, including, but not limited to,
payments made pursuant to Sections 14105.96, 14105.965,
14166.4, and 14182.15 of the Welfare and Institutions Code,
payments described in paragraph (4) of subdivision (b) of Section
14301.4 of the Welfare and Institutions Code, and payments made
available to a county provider or designated public hospital, or
governmental entity with which it is affiliated, under any other
successor or modified Medicaid payment system.

(E) Participate in the financing of, and receive, safety net care
pool funding, stabilization funding, delivery system reform
incentive pool payments, and any other funding available to a
county provider or designated public hospital, or governmental
entities with which it is affiliated under the Medicaid demonstration
project authorized pursuant to Article 5.2 (commencing with
Section 14166) and Article 5.4 (commencing with Section 14180)
of Chapter 7 of Part 3 of Division 9 of the Welfare and Institutions
Code, or under any other successor or modified Medicaid
demonstration project or Medicaid payment system. The allocation
of safety net care pool funds shall be made in consultation with
the State Department of Health Care Services and other designated
safety net hospitals.

(F) Participate in the financing, administration, and provision
of services under the Low Income Health Program authorized
pursuant to Part 3.6 (commencing with Section 15909) of Division
9 of the Welfare and Institutions Code, or under any other
successor or modified Medicaid demonstration project or Medicaid
payment system if the authority enters into an agreement with the
county concerning the provision of services by, and payment for
these services to, the county.

(G) Participate in and receive direct grant and payment
allocations pursuant to Article 5.228 (commencing with Section
14169.1) of Chapter 7 of Part 3 of Division 9 of the Welfare and
Institutions Code, or under any other successor or modified direct
grant and payment systems funded by hospital or other provider
fee assessments.

(H) Receive Medi-Cal capital supplements pursuant to Section
14085.5 of the Welfare and Institutions Code. Notwithstanding
any other law, supplemental payments shall be made to the medical
center under Section 14085.5 of the Welfare and Institutions Code
for the debt service costs incurred by the county, and, if applicable,
by the authority to the extent that debt service responsibility is
refinanced, transferred to, or otherwise assumed by, directly or
indirectly, the authority.

(I) Receive any other funds that would otherwise be available
to a county provider or designated public hospital, or governmental
entity with which it is affiliated.

(2) A transfer described in paragraph (1) shall not otherwise
disqualify the county or the governing board, or in the case of a
change in license ownership, the authority, from participating in
any of the following:

(A) Local, state, and federal funding sources either specific to
county or district hospitals, county or district ambulatory care
clinics, designated public hospitals, or government entities with
which they are affiliated, for which there are special provisions
specific to those hospitals, ambulatory care clinics, or government
entities.

(B) Funding programs in which the county or the governing
board, by themselves or on behalf of the medical center or the
other health care facility, respectively, had participated prior to
the creation of the authority, or would otherwise be qualified to
participate in had the authority not been created, and the
maintenance, operation, and management or ownership of the
medical center and the other health care facility not been
transferred by the county and the governing board to the authority
pursuant to this chapter.

(l) The authority, the county, and the governing board, or any
combination thereof, may engage in marketing, advertising, and
promotion of the medical and health care services made available
to the community by the authority.

(m) The board of trustees shall have authority over procurement
and contracts for the authority. The board of trustees shall adopt
written rules, regulations, and procedures with regard to these
functions. Contracts by and between the authority and a public
agency, and contracts by and between the authority and providers
of health care, goods, or services, may be let on a nonbid basis
and shall be exempt from Chapter 2 (commencing with Section
10290) of Part 2 of Division 2 of the Public Contract Code.
Notwithstanding any other provision of this section, the authority
shall not subcontract work performed by classifications represented
by employee organizations without mutual agreement between the
authority and the exclusive representatives, except that a
subcontract entered into prior to the formation of the authority
may remain in effect until its termination or completion and may
be modified or renewed to a later termination or completion date
upon agreement between the authority and the exclusive
representatives of the affected classifications.

(n) The authority shall be responsible for human resource
functions, including, but not limited to, position classification,
compensation, recruitment, selection, hiring, discipline,
termination, grievance, equal opportunity, performance
management, probationary periods, training, promotion, and
maintenance of records. The board of trustees shall adopt written
rules, regulations, and procedures with regard to these functions.
Until the time that the board of trustees adopts its own rules,
regulations, or procedures with regard to these functions, the
existing rules, regulations, and procedures set forth in any
memorandum of understanding described in paragraph (3) of
subdivision (d) of Section 101852.2 shall apply. If the memoranda
do not provide for the exercise of these functions, the rules,
regulations, and procedures of the county shall apply.

(o) The authority may contract with the county or the governing
board for services and personnel upon mutually agreeable terms.

(p) Notwithstanding Article 4.7 (commencing with Section 1125)
of Chapter 1 of Division 4 of Title 1 of the Government Code,
related to incompatible activities, a member of the authority’s
administrative staff shall not be considered to be engaged in
activities inconsistent and incompatible with his or her duties as
a result of prior employment or affiliation with the county or the
governing board.

(q) The board of trustees and the officers and employees of the
authority are public employees for purposes of Division 3.6
(commencing with Section 810) of Title 1 of the Government Code,
relating to claims and actions against public entities and public
employees, and shall be protected by the immunities applicable to
public entities and public employees governed by Part 2
(commencing with Section 814) of Division 3.6 of Title 1 of the
Government Code, except as provided by other statutes or
regulations that apply expressly to the authority.

(r) Except for Part 3 (commencing with Section 20000) of
Division 5 of Title 2 of the Government Code, this chapter shall
prevail over any inconsistent statutes governing employees of the
authority, including, but not limited to, the Meyers-Milias-Brown
Act (Chapter 10 (commencing with Section 3500) of Division 1 of
Title 1 of the Government Code).

begin insert 101852.6. end insert   

The board of trustees may find and declare that the
authority shall cease to exist. In that event, the board of trustees
shall provide for the disposition of the authority’s assets,
obligations, and liabilities. Absent written agreement, the county
shall not be obligated under any law to assume the authority’s
obligations or liabilities, or take title to, or custody or control of,
the authority’s assets. Upon notification by the authority of the
disposition of the authority’s assets and liabilities, the board of
supervisors shall rescind the ordinance that established the
authority, and the authority shall cease to exist on the date set
forth in the rescinding ordinance.

end insert

begin delete

SECTION 1.  

Chapter 3.5 (commencing with Section 101800)
is added to Part 4 of Division 101 of the Health and Safety Code,
to read:

 

Chapter  3.5. Kern County Hospital Authority

 

101800.  

(a) The board of supervisors of the County of Kern
may establish the Kern County Hospital Authority, which shall
for all purposes be a public entity separate and apart from the
county and any other public entity. The authority established
pursuant to this chapter shall file the statement required by Section
53051 of the Government Code, and shall be considered a public
entity for purposes of Division 3.6 (commencing with Section 810)
of Title 1 of the Government Code.

(b) (1) In order for the authority to be established, transact any
business, exercise its powers, or undertake its duties and
responsibilities, the board of supervisors of the County of Kern
and the governing body of at least one health care facility shall
reach an agreement, on terms and conditions satisfactory to the
parties, regarding the affiliation or consolidation.

(2) An agreement concerning the transfer of existing employees
from the county to the authority shall include a transition plan that
recognizes and ensures employee protections.

(3) If the board of supervisors of the County of Kern and the
governing body of at least one health care facility reach an
agreement, the terms and conditions of the agreement shall be
binding upon the authority. After the agreement is reached, the
board of supervisors of the County of Kern shall adopt an ordinance
to establish the authority and authorize the authority to exercise
its powers and duties, and the board of supervisors and the
governing board shall appoint a board of trustees.

end delete