§ 131E-8. Sale of hospital facilities to nonprofit corporations. - North Carolina Statutes

§ 131E‑8.  Sale ofhospital facilities to nonprofit corporations.

(a)        A municipality as defined in G.S. 131E‑6(5) orhospital authority as defined in G.S. 131E‑16(14), upon such terms andconditions as it deems wise, with or without monetary consideration, may sellor convey to a nonprofit corporation organized under Chapter 55A of the GeneralStatutes any rights of ownership the municipality or hospital authority has ina hospital facility including the building, land and equipment associated withthe hospital, if the nonprofit corporation is legally committed to continue tooperate the facility as a community general hospital open to the generalpublic, free of discrimination based upon race, creed, color, sex or nationalorigin. The nonprofit corporation shall also agree, as a condition of themunicipality or hospital authority's conveying ownership, to provide suchservices to indigent patients as the municipality or hospital authority and thenonprofit corporation shall agree. The nonprofit corporation shall furtheragree that should it fail to operate the facility as a community generalhospital open to the general public or should the nonprofit corporationdissolve without a successor nonprofit corporation to carry out the terms andconditions of the agreement of conveyance, all ownership rights in the hospitalfacility, including the building, land and equipment associated with thehospital, shall revert to the municipality or hospital authority or successorentity originally conveying the hospital.

(b)        When either general obligation bonds or revenue bonds issuedfor the benefit of the hospital to be conveyed are outstanding at the time ofsale or conveyance, then the nonprofit corporation must agree to the following:

By the effective date of sale or conveyance, thenonprofit corporation shall place into an escrow fund money or directobligations of, or obligations the principal of and interest on which, areunconditionally guaranteed by the United States of America (as approved by theLocal Government Commission), the principal of and interest on which, when dueand payable, will provide sufficient money to pay the principal of and theinterest and redemption premium, if any, on all bonds then outstanding to thematurity date or dates of such bonds or to the date or dates specified for theredemption thereof. The nonprofit corporation shall furnish to the LocalGovernment Commission such evidence as the Commission may require that thesecurities purchased will satisfy the requirements of this section. A hospitalwhich has placed funds in escrow to retire outstanding general obligation orrevenue bonds, as provided in this section, shall not be considered a publichospital, and G.S. 159‑39(a)(3) shall be inapplicable to such hospitals.

(c)        Any sale or conveyance under this section must be approvedby the municipality or hospital authority by a resolution adopted at a regularmeeting of the governing body on 10 days' public notice. Notice shall be givenby publication describing the hospital facility to be conveyed, the proposedmonetary consideration or lack thereof, and the governing body's intent toauthorize the sale or conveyance.

(d)        Neither G.S. 153A‑176 nor Article 12 of Chapter 160Aof the General Statutes shall apply to sales or conveyances pursuant to thissection.

(e)        A sale or conveyance of substantially all the equipment is asale or conveyance of hospital facility. (1983, c. 775, s. 1; 1989, c. 444.)