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Ask MRSC

October 2013

Ask MRSC

In the periodic Ask MRSC PHD (Public Hospital Districts) e-newsletter, MRSC consultants respond to questions posed by officials and staff of Washington public hospital districts. Submit your own question via our simple online form.

IN THIS ISSUE

  1. If the public hospital district statute requires a resolution, can a motion be used instead?
  2. On my reading of RCW 70.44.300, the board of commissioners may choose to use a licensed real estate broker if in the judgment of the board the sale of any district real property not needed for public hospital district purposes would be facilitated and greater value realized through use of the services of licensed real estate brokers. The wording doesn't seem to mandate the utilization of a real estate broker unless they think it will enhance the sale value. Is that correct?
  3. Do you know if anyone keeps track of all the property tax rates being paid in public hospital districts across the state?
  4. We're currently looking for a new CEO for our facility, and we have a candidate from another state. In the past, we paid for such candidates to come interview and visit and I'm wondering if we, as a public hospital district, can pay for her to come with her husband and two kids?
  5. We're in the process of updating our policy for small works. Currently we have a simple small works roster application for contractors to fill out. We're considering adding criteria to keep our roster updated. One criterion would be to have at least 5 years' experience contracting for hospital facilities. Is this permissible?

 

1. If the public hospital district statute requires a resolution, can a motion be used instead?

Washington case law has held that there is no difference in substance between a resolution and a motion. See, e.g., Spokane v. Ridpath, 74 Wash. 4 (1913). However, regarding enactments by a hospital district board of commissioners for which the hospital district statute (chapter 70.44 RCW) specifically requires a "resolution," we recommend that the board explicitly refer to the enactment as a "resolution." For example, RCW 70.44.070(1) requires that the board fix the superintendent's compensation by resolution.

Although such a resolution need not necessarily be in the form of a separate document, we recommend, in order to ensure sufficient formality, that the board use a separate document entitled "resolution" to approve such actions, that the meeting minutes clearly specify that the action approved by the board was by resolution, and that the resolution explicitly addresses what is required by the statutory provision at issue. For example, RCW 70.44.300 (related to sale of surplus real property) requires that the board determine by resolution that the property at issue is no longer required for hospital district purposes, or that the sale of the property will further the purposes of the district.

As an alternative to setting forth a resolution in a separate document, it may be that some districts include the full text of the resolution in the meeting minutes, but we recommend using a separate document and identifying it as a resolution for clarity and recordkeeping purposes. Note, too, that AWPHD has available a document entitled, "Statutorily Required Board Actions by Resolution" (revised April, 2011), that includes a detailed list of actions that must be done by board resolution.

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2. On my reading of RCW 70.44.300, the board of commissioners may choose to use a licensed real estate broker if in the judgment of the board the sale of any district real property not needed for public hospital district purposes would be facilitated and greater value realized through use of the services of licensed real estate brokers. The wording doesn't seem to mandate the utilization of a real estate broker unless they think it will enhance the sale value. Is that correct?

RCW 70.44.300(4) gives the board of commissioners the option of contracting with a licensed real estate broker but doesn't require such a contractual arrangement. Based on general principles of statutory construction, use of the word "may" means the action is discretionary and not mandatory. We interpret RCW 70.44.300(4) to mean that if in the judgment of the board the sale of the surplus real property at issue would be facilitated and greater value realized through use of the services of licensed real estate brokers, the board may, but is not required to, contract with a licensed real estate broker for such services.

Additionally, under RCW 70.44.300(4), we think a hospital district could potentially use a real estate expert other than a real estate broker to conduct the sale, as long as the district otherwise complies with RCW 70.44.300. Otherwise complying with RCW 70.44.300 includes, among other actions, getting three (3) professional market value appraisals, and not selling the property for less than ninety percent (90%) of the average of such appraisals. See, RCW 70.44.300(2).

 

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3. Do you know if anyone keeps track of all the property tax rates being paid in public hospital districts across the state?

Public hospital district property tax rates are provided in a table that is available on the Washington State Department of Revenue's (DOR) Property Tax Statistics 2013 website. The complete report for 2013 can be downloaded through this link (PDF). The applicable table related to property tax rates is listed as Table 30, Part 2: Junior Taxing District Levies Due in 2013. There is also a separate PDF and an Excel version of Table 30.

The DOR website doesn't include a detailed levy table focused solely on hospital districts. However, if you're familiar with Excel, you can access the Excel version of Table 30 and do a sort, which may produce the results in the manner you're seeking.

The DOR website includes other tables that may be of interest related to hospital districts, including:

  • Table 9: Property Taxes by Fund, According to Tax Year Due, 2009-2013 (PDF | Excel)
  • Table 10: Property Tax Levies Due in 2013 by Major Taxing District and County (PDF | Excel)
  • Table 11: Number of Taxing Districts by Type, 2009-2013 (PDF | Excel)
  • Table 15: Assessed Value of Selected Taxing Districts for Taxes Due in 2013 by County (PDF | Excel)

 

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4. We're currently looking for a new CEO for our facility, and we have a candidate from another state. In the past, we paid for such candidates to come interview and visit and I'm wondering if we, as a public hospital district, can pay for her to come with her husband and two kids?

RCW 70.44.060(9) allows a public hospital district to pay for actual necessary travel and living expenses in such situations, including related to family members accompanying the candidate, as long as the district otherwise complies with RCW 70.44.060(9). More specifically, RCW 70.44.060(9) provides that all hospital districts are authorized:

To pay actual necessary travel expenses and living expenses incurred while in travel status for (a) qualified physicians or other health care practitioners who are candidates for medical staff positions, and (b) other qualified persons who are candidates for superintendent or other managerial and technical positions, which expenses may include expenses incurred by family members accompanying the candidate, when the district finds that hospitals or other health care facilities owned and operated by it are not adequately staffed and determines that personal interviews with said candidates to be held in the district are necessary or desirable for the adequate staffing of said facilities.

We recommend that the district also comply with any policies it may have regarding this activity. If the district has such policies, those policies need to be consistent with RCW 70.44.060(9).

 

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5. We're in the process of updating our policy for small works. Currently we have a simple small works roster application for contractors to fill out. We're considering adding criteria to keep our roster updated. One criterion would be to have at least 5 years' experience contracting for hospital facilities. Is this permissible?

We recommend that a public hospital district in such a situation specifically define what the district regards as "responsible" for the purposes of its small works roster. We also recommend that the district adopt a policy to update the roster on a regular basis (e.g., every year).

Concerning what is regarded as a "responsible" bidder, note that RCW 39.04.155(2)(a), made applicable to hospital districts through RCW 70.44.140(2), provides, in part (emphasis added):

The small works roster or rosters shall consist of all responsible contractors who have requested to be on the list, and where required by law are properly licensed or registered to perform such work in this state. ... In addition, responsible contractors shall be added to an appropriate roster or rosters at any time they submit a written request and necessary records.

RCW 39.04.010 defines "responsible bidder" as "a contractor who meets the criteria in RCW 39.04.350." RCW 39.04.350(1) sets forth general requirements and subpart (2) allows the district to establish supplemental criteria for determining bidder responsibility. See also, RCW 39.06.020 (verification of subcontractor responsibility criteria).

We have advised that an agency can, for example, define a responsible bidder as a contractor who meets the mandatory requirements in RCW 39.04.350(1) as well as the supplemental criteria as provided in the bid documents. In the context of a particular project, an agency could require, for example, that a bidder have satisfactorily completed some set number of projects of commercial quality (presuming these terms are carefully defined) in the past specified number of years. Note that the appeal process in RCW 39.04.350 must be in the bid documents as well.

We recommend that you review the "CPARB's Suggested Guidelines for Bidder Responsibility" (revised February 2012), prepared by the State of Washington Capital Projects Advisory Review Board. If you search that document for the term "experience," for example, you'll get several hits that are likely of interest as you think about developing supplemental criteria.

Regarding, more generally, updates to the district's small works roster, we have advised that an agency can establish a small works roster policy and process whereby the roster shall terminate after some specific period of time. To do so, the district would need to specify the termination date in its written small works roster process, and advertise at least once per year about the availability of the roster and its termination date.

 

To avoid possible protests from contractors regarding the roster, the district, for example, could establish a two or three year termination period of the roster to weed out uninterested or unqualified contractors or contractors who are no longer in business. Another approach would be to require, on an annual basis, that all contractors resubmit their qualifications to remain on the roster. Under this approach, all responsible contractors who resubmit their qualifications would remain on the roster and those who choose not to resubmit and those who are not "responsible" (see above) would be dropped. In the yearly notice of roster availability as set forth in RCW 39.04.155, the district would advise that a letter of continued interest and current qualifications must be submitted annually by responsible contractors to remain on the district's small works roster.

 

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