CHAPTER 136. TEXAS COMMUNITY HEALTH CENTER REVOLVING LOAN FUND - Texas Statutes

HUMAN RESOURCES CODE

TITLE 9. HEALTH AND HUMAN SERVICES

CHAPTER 136. TEXAS COMMUNITY HEALTH CENTER REVOLVING LOAN FUND

Sec. 136.001. PURPOSE. The legislature finds that:

(1) community health centers play a significant role in the

delivery of medical care and related services to the residents of

this state who cannot afford health insurance;

(2) community health centers are a cost-effective way to provide

primary and preventive health care to populations lacking quality

health care by reducing hospitalizations and the inappropriate

use of emergency rooms;

(3) the financing sources available for the capital needs of

community health centers, such as buildings and equipment, are

inadequate; and

(4) increasing community health centers' access to capital would

benefit residents of this state in poor and underserved

communities and foreign-born residents who are uninsured, by

providing greater access to primary care and preventive health

services and by targeting the common health problems of these

residents.

Added by Acts 2001, 77th Leg., ch. 878, Sec. 1, eff. Sept. 1,

2001.

Sec. 136.002. DEFINITIONS. In this chapter:

(1) "Community health center" means a nonprofit corporation in

this state that:

(A) provides required primary health services, including:

(i) basic health services;

(ii) referrals to providers of medical services;

(iii) patient case management services;

(iv) outreach; and

(v) patient education; and

(B) has a governing board that:

(i) is composed of individuals, a majority of whom are being

served by the community health centers; and

(ii) represents the individuals being served by the community

health center.

(2) "Commission" means the Health and Human Services Commission.

(3) "Development corporation" means a nonprofit corporation

that:

(A) provides revolving loan funds to community health centers;

(B) accepts gifts and grants;

(C) seeks funding from various government and private sources;

and

(D) associates with a broad-based organization serving community

health centers.

(4) "Fund" means the community health center revolving loan fund

established by this chapter.

(5) "Program" means the loan program authorized by this chapter.

Added by Acts 2001, 77th Leg., ch. 878, Sec. 1, eff. Sept. 1,

2001.

Sec. 136.003. TRUST FUND. (a) The community health center

revolving loan fund is a trust fund outside the state treasury

held by a financial institution and administered by the

commission as trustee on behalf of community health centers in

this state.

(b) The fund is composed of:

(1) money appropriated to the fund by the legislature;

(2) gifts or grants received from public or private sources; and

(3) income from other money in the fund.

(c) The commission may accept on behalf of the fund gifts and

grants for the use and benefit of the program.

Added by Acts 2001, 77th Leg., ch. 878, Sec. 1, eff. Sept. 1,

2001.

Sec. 136.004. DEVELOPMENT CORPORATION. The commission shall

contract with and award money to a development corporation to

carry out the purposes of this chapter.

Added by Acts 2001, 77th Leg., ch. 878, Sec. 1, eff. Sept. 1,

2001.

Sec. 136.005. INVESTMENT COMMITTEE. (a) Before contracting

with a development corporation, the commission shall require the

development corporation to establish an investment committee to

approve loan requests of community health centers.

(b) The investment committee must consist of seven members as

follows:

(1) at least two members with lending experience;

(2) at least two members who receive health care services from a

community health center; and

(3) at least one member who represents the Texas Association of

Community Health Centers, Inc.

Added by Acts 2001, 77th Leg., ch. 878, Sec. 1, eff. Sept. 1,

2001.

Sec. 136.006. LOANS TO COMMUNITY HEALTH CENTERS. (a) The

development corporation may make a loan to a community health

center only with the approval of the investment committee.

(b) The development corporation shall use at least 60 percent of

the money received under the program for loans to community

health centers in existence for at least one year before the loan

date.

(c) A loan made by the development corporation may be

subordinated debt.

(d) The development corporation may make a loan under the

program through a partnership or joint investment with one or

more financial institutions or federal or state programs.

(e) Payments on community health center loans shall be made to

the development corporation. The development corporation shall

use the loan payment money received from community health centers

to make new loans as provided by this chapter.

Added by Acts 2001, 77th Leg., ch. 878, Sec. 1, eff. Sept. 1,

2001.

Sec. 136.007. SELF-FUNDING. The commission shall develop the

fund program as a revolving loan fund that will become

self-funding over the life of the program.

Added by Acts 2001, 77th Leg., ch. 878, Sec. 1, eff. Sept. 1,

2001.

Sec. 136.008. INCOME FROM LOAN. All income received on a loan

made with money received under the program is the property of the

development corporation. Income received on a loan includes the

payment of interest by a borrower and the administrative fees

assessed by the development corporation.

Added by Acts 2001, 77th Leg., ch. 878, Sec. 1, eff. Sept. 1,

2001.

Sec. 136.009. RULES. (a) The commission shall adopt rules to

administer this chapter, including rules that require:

(1) the commission to review the lending and servicing practices

of a development corporation to ensure the practices conform to

generally accepted accounting principles;

(2) an eligible community health center to enter into an

agreement with the development corporation that states the terms

of the loan made to the center;

(3) the development corporation to provide to the commission

semiannual reports giving details of the status of each loan made

under the program;

(4) the development corporation to require annual audits of

community health centers receiving loans under the program; and

(5) the commission to provide oversight of the development

corporation as necessary to qualify the development corporation

for loan guarantees from federal and state programs.

(b) Under rules adopted by the commission, the development

corporation may:

(1) make grants to eligible community health centers from money

other than money that is received from the fund and that was

derived from a legislative appropriation; or

(2) seek funds from state or federal agencies or private sources

to supplement and complement the funds received under the

program.

(c) The commission may adopt other rules as necessary to

accomplish the purposes of this chapter.

Added by Acts 2001, 77th Leg., ch. 878, Sec. 1, eff. Sept. 1,

2001.