Mississippi Advisory Opinions March 05, 2004: AGO 2004-0085 (March 05, 2004)

Advisory Opinion Text

Colmon S. Mitchell

Smith, Phillips, Mitchell & Scott

Post Office Drawer 1586

Batesville, Mississippi 38606

Re: Sale or Lease of Community Hospital

Dear Mr. Mitchell:

Attorney General Jim Hood has received your request for an official opinion and has assigned it to me for research and response. Your letter reads as follows:

I represent the City of Batesville, Mississippi. This letter addresses questions that I have on behalf of the Cit of Batesville under Section 41-13-15 of the Mississippi Code of 1972, as amended (Revised 2001) in connection with the proposed sale of a community hospital.

Background

The City of Batesville [hereinafter the City] and Panola County, Mississippi [hereinafter the County] own a community hospital [hereinafter the hospital] pursuant to the provisions of Section 41-13-1 et seq. of the Mississippi Code of 1972 (Revised 1002). The City owns forty percent (40%) interest in the hospital and the County owns sixty percent (60%) interest in the hospital. The hospital is located in the City of Batesville, in the South Panola County Hospital District [hereinafter the Hospital District].

The Hospital District was established in 1975 and its boundary is the same as the Second Judicial District of Panola County, Mississippi. Residents of the Hospital District provide financial support to the hospital through a millage assessment imposed by the County. Panola County residents outside the Hospital District are not taxed for the hospital.

Law

The pertinent sections of the Mississippi Code of 1972 (Revised 2001), about which I will inquire are as follows:

Section 41-13-10(d) defines “Owner” for purposes of the other statutes referred to herein.

Section 41-13-15(10) provides for the procedure for the sale of the hospital and includes provisions for an election and provides in part that “if on or before the date proposed fore the sale… of the hospital, there is filed with the clerk of the owner a petition signed by twenty percent (20%) or fifteen hundred (1,500), whichever is less, of the qualified voters of the owner , requesting that an election be called and held on the question of the sale…, then it shall be the duty of the owner to call and provide for the holding of an election as petitioned for. In such case, no such sale… shall be entered into unless authorized by the affirmative vote of a majority of the qualified voters of the owner who vote on the proposition at such election” [emphasis added] * * * * *

In light of the foregoing facts and law, you then ask a series of questions, which will be answered in the order presented.

Question 1 . I would like for you to provide the City with guidance relative to the procedure established for the sale of the hospital under Section 41-13-15(10) . As I understand the statute, if both the City and the County elect to sell the hospital then they need to take the following steps, which the City and the County would propose to take in the following manner:

1. The City and the County set a public hearing on the issue of the proposed sale. The public hearing will be one public hearing before the City and the County.

2. Publish notice of the date, time, location and purpose of the public hearing in the manner and for the time prescribed by Section 41-13-15(10) . The public hearing must occur twenty-one (21) days or more after the first publication and within seven (7) days of the last publication of the notice. This notice will be a joint notice of both the City and the County.

3. After the public hearing, if both the City and the County choose to sell the hospital they shall each adopt a Resolution describing their intention to sell. This will be a joint Resolution adopted by both the City and the County.

4. This Resolution must be published along with the requirements for proposals for the sale and the date proposed by the owner for the sale. This notice must be published in the manner and for the time prescribed in Section 41-13-15(10) which includes the requirement that the “first publication of the notice shall be made not less than twenty-one (21) days before the date proposed for the sale .. and the last publication shall be made not more than seven (7) days before that date .” [emphasis added]

5. The statute is silent as to what to do on the date proposed for the sale. We propose to proceed as follows: On the date proposed for the sale the City and the County will receive the proposals and take them under advisement to consider and evaluate same before making a decision to accept any proposal. If a proposal is accepted, it will be accepted on a date after the “date proposed for the sale” after the City and the County have evaluated the proposals. If a sale occurs, it will actually take place at a later date. I do not see how the City and the County can receive the proposals, evaluate the proposals, and consummate the sale on the “date proposed for the sale.”

Response to Question 1 . This office is satisfied that the City and County would be in compliance with Section 41-13-15(10) were they to follow the procedures set out above for the conduct of a public hearing, notification, and sale of the community hospital. We are of the opinion that your interpretation with regard to the phrase “date proposed for the sale” being the date established in the notice that the proposals are to be received is logical and consistent with the purposes of the law, considering the many factors which will necessarily go into the determination of which proposal is the “highest and best,” which is required by Section 41-13-15(10), and considering that this decision will involve actions by both the municipal and county governing authorities. See response below.

Question 2 . Must both the Mayor and Board of Aldermen of the City of Batesville and the Board of Supervisors of Panola County accept a proposal before the proposal is deemed to be accepted? (Based on your February 27, 1986, opinion to Hon. Robert W. Brumfield it appears that when the statute requires the owner of a community hospital to do something, it takes the separate affirmative action of each entity to constitute the action of the owner of the hospital.)

Response to Question 2 . Section 41-13-10(d) defines the term “owner” as:

…any board of supervisors of any county having an ownership interest in any community hospital or leased facility on behalf of the county or on behalf of any supervisors district, judicial district or election district of the county and shall also mean any governing council or board of any municipality having an ownership interest in any community hospital or leased facility.

We are of the opinion that, as the hospital in question is jointly owned by the City and the County, any action which must be exercised by the “owner” of the community hospital must be exercised by both the City and the County. This is consistent with the prior opinion you referenced in your request. MS AG Op, Brumfield (February 27, 1986).

Question 3 . Does the election process apply to each owner separately (separate elections, separate petitions, etc.) or does the election process apply to the City and the County as if they were one entity - “the owner?”

1. Who may sign the petition?

2. With whom is the petition filed?

3. Who holds the election?

4. Who pays for the election?

5. When must signatures be obtained on the petition requesting the election? (For example, can the signatures pre-date the public hearing?)

Response to Question 3 . Section 41-13-15(10) provides, in pertinent part, as follows:

If, on or before the date proposed for the sale or lease of the hospital, there is filed with the clerk of the owner a petition signed by twenty percent (20%) or fifteen hundred (1500), whichever is less, of the qualified voters of the owner, requesting that an election be called and held on the question of the sale or lease with an option to sell the hospital, then it shall be the duty of the owner to call and provide for the holding of an election as petitioned for. In that case, no such sale or lease shall be entered into unless authorized by the affirmative vote of the majority of the qualified voters of the owner who vote on the proposition at such election. Notice of the election shall be given by publication in the same manner as provided for the publication of the initial resolution. The election shall be conducted and the return thereof made, canvassed and declared in the same manner as provided by law in the case of general elections in the owner. If, on or before the date proposed for the sale or lease of the hospital, no such petition is filed with the clerk of the owner, then the owner may sell or lease with an option to sell the hospital.

On the question of interpreting statutes, the Mississippi Supreme Court has ruled that “… the chief desire of the courts is to reach the real intention of the Legislature.... Unthought of results must be avoided if possible, especially if injustice follows, and unwise purpose will not be imputed to the Legislature when a reasonable construction is possible. (Internal cites omitted) Zeigler v. Zeigler , 174 Miss. 302 at 310, 164 So. 768 (1935) While, as we stated in our response to Question 2, any action exercised by the “owner” of a community hospital must be exercised by each owner, to apply this rationale to the election process set out in Section 41-13-15(10) could potentially lead to the absurd result of requiring two elections on the same question, with possibly the same pool of citizens involved. Therefore, it is the opinion of this office that for the limited purposes of conducting the election provided for in Section 41-13-15(10), the county and the city should be viewed as one owner.

1. Section 41-13-15(10) requires a petition be signed by either 20% or 1500 (whichever is less) of the qualified electors of the owner. As we stated above, the owner is the municipality and the county. Twenty percent (20%) qualified electors (or 1500 qualified electors) of the area encompassing the Hospital District may compel the election. The electors eligible to sign the petition would be any qualified municipal electors and any qualified county electors residing outside the municipality but within the Hospital District. Many of those citizens may be qualified electors in both the county and municipality. An elector may only sign the petition once, and may not sign as both a municipal elector and county elector.

2. As all of the persons signing the petition will necessarily be county electors, the petition should be filed with the Chancery Clerk of Panola County, as the Clerk of the Board of Supervisors.

3. The election would be conducted under the auspices of the County Election Commission.

4. Panola County would be required to pay for the election. The city may contribute money to the county to defray expenses of the election.

5. The statute establishes no time-frame for the collection of signatures on the petition. Therefore, the signatures may pre-date the public hearing.

Question 4 . As I understand the statute, the deadline to file the petition requesting an election is the “date proposed for the sale” as that phrase is used in Section 41-13-15(10) and not the date the sale is actually consummated. Is this interpretation correct?

Response to Question 4 . It is the opinion of this office that your interpretation is correct, and that the petitions calling for an election on the question of the sale of the community hospital must be filed on or before the date the proposals for purchase of the hospital are received by the owner(s).

If our office may be of further assistance, please advise.

Sincerely,

Jim Hood Attorney General

Heather P. Wagner Assistant Attorney General