Sublette County Hospital
Joint Powers Board Agreement
THIS SUBLETTE COUNTY HOSPITAL JOINT POWERS BOARD AGREEMENT (“Agreement”) is made by and between THE COUNTY OF SUBLETTE, WYOMING, by and through the Sublette County Board of Commissioners (“County”), and the SUBLETTE COUNTY RURAL HEALTH CARE DISTRICT (“District”), collectively referred to herein as the “participating agencies”, and individually as a “participating agency.”
WHEREAS, pursuant to the Wyoming Joint Powers Act, Wyo. Stat. Ann. § 16-1-101 et seq., (“Act”), any power, privilege, or authority exercised or capable of being exercised by any agency may be exercised and enjoyed jointly with any other agency having a similar power, privilege or authority;
WHEREAS, the County and District are each an “agency,” as that term is defined in the Act, and each has the authority to enter into this Agreement and to form a joint powers board (“Joint Powers Board” or “Board”);
WHEREAS, the participating agencies desire to work cooperatively to establish, furnish, equip and operate a Wyoming-licensed critical access hospital, and related medical and other facilities, in Sublette County, Wyoming, to enhance sustainability and accessibility of health care to the citizens of Sublette County and residents of the District;
WHEREAS, the participating agencies have therefore determined that it is for the benefit of the parties and citizens of Sublette County to jointly, through a Joint Powers Board, plan for, create, finance, and operate such a hospital and related medical and other facilities;
WHEREAS, each participating agency finds and declares that it is in its own interest and in the public interest of its citizens and residents to enter into this Agreement and to create and organize a Joint Powers Board for the purposes outlined in this Agreement.
NOW THEREFORE, in consideration of the premises and of the mutual promises, agreements, and covenants made in this Agreement, the parties agree as follows.
I. Purpose. The purpose of this Agreement is to establish a joint powers board which will provide unified planning, coordination and delivery of health care services to the citizens of Sublette County, including creating and operating a Wyoming-licensed critical access hospital, and related medical and other facilities (the “Hospital”) in Sublette County, Wyoming.
II. Creation and Composition of the Joint Powers Board. There is hereby created, pursuant to Wyo. Stat. Ann. § 16-1-106 of the Act, a joint powers board named the “Sublette County Hospital Joint Powers Board” (the “Joint Powers Board” or the “Board”). The Joint Powers Board shall constitute a legal entity separate and distinct from the County and District. The Joint Powers Board shall consist of seven (7) members (each a “Member”), selected and appointed as follows:
A. The governing body of the District shall appoint three (3) Members to the Joint Powers Board.
B. The governing body of the County shall appoint four (4) Members to the Joint Powers Board.
1. At least three (3) of the County’s initially appointed Members shall be directors or officers of the Sublette Center, a Wyoming non-profit corporation and federally tax-exempt entity under Internal Revenue Code section 501(c)(3) (“Sublette Center”).
2. For so long as the Sublette Center leases its facilities to the Joint Powers Board, as described in Section XI.A of this Agreement, the County shall at all times appoint at least three (3) Members of the Joint Powers Board from the directors or officers of Sublette Center.
C. All persons appointed as Members shall be qualified electors of Sublette County, Wyoming[RL1] .
D. Each of the participating agencies shall make its initial appointments to the Joint Powers Board within sixty (60) days of the effective date of this Agreement.
III. Term and Termination of Joint Powers Board Members. Members of the Joint Powers Board shall serve in accordance with the following terms.
A. The initial terms of the Members shall be for staggered terms of one (1), two (2), and three (3) years, with Members subject to reappointment. In order to set up the staggering terms, initially two (2) of the Members appointed by the County shall be appointed for a one (1) year term, each of the Members appointed by the District shall be appointed for a two (2) year term, and the remaining two (2) members appointed by the County shall be appointed for a three (3) year term. [RL2]
B. Following the first term of each Member, each subsequently appointed Member shall serve one (1) or more three (3) year terms. Members may serve consecutive terms until removed or resigned from the Board.
C. If a Member resigns, is removed, ceases to be a qualified elector of Sublette County, or is otherwise unable or unwilling to perform the functions as required by this Agreement and the Act, his or her Membership shall be declared vacant. Vacancies for unexpired terms of Members shall be filled by appointment by the participating agency which appointed the vacating Member in the same manner that the vacated position was initially appointed. The filling of such vacancies must comply with Section II.B of this Agreement, in that at least three (3) County-appointed Members must always be directors or officers of Sublette Center, for so long as Sublette Center leases its facilities to the Joint Powers Board, as set forth in section XI.A.
D. Members of the Joint Powers Board may be removed at any time, with or without cause, by the participating agency which appointed that Member. The participating agency removing a Member shall give written notice to removed Member before removal, and shall notify the Joint Powers Board as soon as practicable after removal.
IV. Board Organization. Promptly following their respective appointments, the Members shall meet, organize as the Joint Powers Board, and elect from their Membership a chair or president, vice-chair or vice-president, secretary, and treasurer. Such officers shall have and exercise those powers, duties, and obligations set out in this Agreement and in the Joint Powers Board’s bylaws. The secretary of the Joint Powers Board shall then notify the participating agencies of the Board’s organization and shall file a certificate with the County Clerk of Sublette County and the Secretary of State of Wyoming showing the Board’s organization.
A. Meetings of the Board. The Joint Powers Board shall meet as follows:
1. As shall be provided by the Board’s bylaws, on a regular basis not less than once every month, on a schedule set by the chair; and
2. Within five (5) days after an oral or written request of a majority of the Members, transmitted to the secretary of the Board, so long proper and sufficient notice is provided as required by law, if any.
The Joint Powers Board may provide in its Bylaws for emergency meetings in accordance with law.
V. Liability and Governmental Immunity.
A. Except as otherwise provided by law, no individual Member of the Joint Powers Board shall be personally liable for any actions or procedures of the Joint Powers Board, as provided by Wyo. Stat. Ann. § 16-1-106(b), as amended.
B. Neither the County nor District shall be individually or collectively liable for the acts or omissions of the Joint Powers Board, and the Joint Powers Board shall be solely liable for the consequences of its acts and omissions. The Joint Powers Board shall be a governmental entity for all applicable purposes under Wyoming law, including but not limited to application of the Wyoming Governmental Claims Act. The Joint Powers Board shall timely perform all of its duties and obligations, and discharge all liabilities incurred by it, in lieu of any such performance or discharge that the County or District would otherwise be required to undertake by virtue of such participating agency’s participation in the Joint Powers Board.
C. Nothing herein, nor any action taken by the Joint Powers Board, shall modify, limit, or in any way alter the governmental immunity afforded to the County and District, their governing bodies, or any other person acting on behalf of any of them, or the Joint Powers Board and/or its Members, and any other person acting on its behalf, to the full extent that each such agency may otherwise enjoy governmental immunity under the Wyoming Governmental Claims Act or other Wyoming law.
VI. Compensation. When actually engaged in the performance of their duties, Members of the Joint Powers Board shall receive no compensation from the Joint Powers Board, but shall be reimbursed for travel and per diem expenses as authorized by Wyo. Stat. Ann. § 16-1-106(b), as amended.
VII. Bylaws. The Joint Powers Board shall adopt such bylaws, rules, regulations, or policies as it deems necessary to carry out the business of the Joint Powers Board, so long as such bylaws, rules, regulations, or policies are not inconsistent with this Agreement, the Act, or Wyoming law. The bylaws of the Joint Powers Board shall specify the powers, duties, and/or responsibilities of the officers elected.
VIII. Duties of Joint Powers Board. The Joint Powers Board shall:
A. Comply with all requirements of the Act;
B. Keep minutes of all meetings and keep proper financial records, to the extent required by Wyoming law;
C. Fix the time and place of regular meetings, provided that a regular meeting shall be held at least once every month;
D. Cooperate with and solicit the advice, counsel, and recommendations of the governing bodies of the County and District;
E. Keep the governing bodies of the County and District (and the Sublette Center, for as long as the lease described in Section XI.A is in effect) advised as to its activities, and make such written or formal reports concerning its activities and finances as may be required by the County or District; and
F. Develop and present to the governing body of the County and District an annual budget, in a form and at a time compatible with the budget processes of the County and District. This budget must be approved by the governing bodies of the County and District prior to the receipt or expenditure of funds in each fiscal year.
IX. Powers of Joint Powers Board. The Joint Powers Board shall have all the powers enumerated in, or reasonably implied from, the Act and the laws of the State of Wyoming as are necessary to carry out the purposes of this Agreement. The powers of the Board shall specifically include, but not be limited to, the power to do the following in its own name:
1. Sue and be sued, and prosecute such actions to completion;
2. Enter into contracts of any kind;
3. Take title to and/or lease real or personal property;
4. Accept cash or in-kind donations of any kind;
5. Employ an Executive Director, employees, and such other technical, legal, and clerical staff or contractors as necessary, and engage the services of research and consulting agencies within the limits of its authorized and available funds as may be agreed upon by the Board; and
6. Perform any and all other actions the Joint Powers Board deems necessary and/or advisable in furtherance of its purpose.
The Joint Powers Board shall only possess the power to take such actions as each of the County and District would possess to take the same action if proceeding in their respective individual capacities, and not through the Joint Powers Board.
X. Authority. No individual Member of the Joint Powers Board shall have the authority by virtue of anything in this Agreement to bind the Board, or any participating agency, unless explicitly authorized to do so by the Board, or the participating agency, as applicable.
XI. Ownership and Operation. The following provisions shall apply concerning ownership of any and all assets, including but not limited to facilities, and the operation and maintenance of such facilities.
A. Sublette Center Facilities. The parties agree that certain facilities currently owned and operated by Sublette Center, including its skilled nursing facility, are a necessary part of the Hospital and the participating agencies therefore agree that a lease of the Sublette Center facilities is a necessary condition precedent to the formation of this Agreement and existence of the Joint Powers Board. If within thirty (30) days of the Board’s organization as set forth in Section IV, the Joint Powers Board has not executed a mutually acceptable lease of the Sublette Center facilities with Sublette Center, then this Agreement shall terminate. Such lease shall include the terms described on Appendix A in substantially the same form as set out thereon, in addition to such other terms and conditions as are agreed to by the parties thereto. [RL3]
B. Other facilities. Except as provided in subparagraph A above, all assets, liabilities, and real or personal property acquired by the Joint Powers Board shall be owned by and in the name of the Joint Powers Board, and used solely for the purposes of the Joint Powers Board described herein. Unless otherwise agreed by contract, lease, or agreement with the unanimous approval of the governing bodies of the County and District and the Joint Powers Board, any facility constructed or purchased by the Joint Powers Board shall be owned by the Joint Powers Board.
C. “Home office” structure. The participating agencies agree that their intent is to operate the Hospital in accordance with the “home office” organizational and reimbursement structure, including the following characteristics:
1. The Board shall act as, or establish a, “home office” entity, providing the following for both the facilities leased from the Sublette Center and the critical access hospital:
a. Administrative and clinical services including but not limited to administration, accounting, finance, business office, information technology, operation of plant, housekeeping, medical records, social services and physical therapy; and
b. All staff and health care providers for the critical access hospital and the Sublette Center’s leased facilities.[RL4]
2. The costs associated with providing the staff and services to the critical access hospital and the Sublette Center’s facilities shall be allocated between them and reported using the “home office” methodology on the Medicare cost report submitted to the applicable Medicare Administrative Contractor (MAC), and any similar cost report required by other payors.
3. To the extent necessary to fully implement this “home office” structure, the Board shall either:
a. Establish separate legal entities to own and operate one or more of the Sublette Center’s leased facilities, or the critical access hospital, or the “home office”; or
b. Operate the Sublette Center’s leased facilities and the critical access hospital, together with the “home office”, as a single entity.[RL5]
XII. Participating Agencies’ Interest. The County and District may make one (1) or more capital contributions to the Joint Powers Board. A capital contribution may be cash or in-kind. Each capital contribution shall be recorded in the books and records of the Joint Powers Board in a separate capital account for each of the County and District. In-kind capital contributions shall be valued at their fair market value at the time of the contribution, and the fair market value of the in-kind contribution shall be attributed to the appropriate participating agency’s capital account. Each party shall have an interest in the assets and liabilities of the Joint Powers Board equal to the proportion each participating agency’s capital account bears to the amount of all participating agencies’ capital accounts in the aggregate. Notwithstanding such interest, no participating agency shall be entitled to receive any portion of its respective capital accounts or distribution of assets, liabilities or earnings of the Joint Powers Board, except in accordance with section XV.
XIII. Financing. The Joint Powers Board may formulate any plan or plans for the financing of its activities, including establishing and operating the Hospital, as the Board deems appropriate, within the limits of the Act, Wyoming Law, and the Wyoming Constitution.
A. The District shall, each year of this Agreement, levy and collect all tax revenues legally permissible under Wyoming law, and contribute all such tax revenues to the Joint Powers Board to be used for the purposes of and in the discretion of the Board. The District hereby warrants and represents that, as of the Effective Date, it is permitted to levy and collect a tax of two (2) mills.
B. The Board may solicit and obtain additional funds from sources including, but not limited to, the following:
1. The contribution of funds from one or more of the participating agencies which would be available to each agency if proceeding individually, including, but not limited to, designated proceeds of any portion of a tax revenue stream as may be determined by said governmental body;
2. Issuance of bonds by one or more of the participating agencies for the construction, improvement, or acquisition of a facility if that bond could be issued by the agency for its individual construction, improvement, or acquisition of such a facility;
3. Gifts, donations, or grants of federal money;
4. Loans or grants from the State Land and Investment Board, Wyoming Business Council, or another State or Federal agency;
5. The issuance by the Joint Powers Board of its revenue bonds under the authority in the Act, specifically Wyo. Stat. Ann. § 16-1-107(a)(iii). A resolution authorizing the issuance of said revenue bonds and each revenue bond issued thereunder shall contain a recital that the bonds do not constitute a general obligation of the Joint Powers Board or of any of the participating agencies, but shall be payable from a special fund to contain the revenues to be derived from the ownership, operation, renting, or leasing of the project, and further, that the lien of the pledge of the revenues constitutes a first lien, but not necessarily an exclusive first lien, on said revenues, and further that the project is to be funded by the proceeds of the bonds which will be pledged, if necessary, as additional security for the payment of bonds; or
6. By any other method allowed in the Act.
XIV. Duration of Agreement and Termination. Subject to section IV.A, this Agreement and the Joint Powers Board shall be of perpetual duration, unless otherwise sooner terminated as set out herein.
A. Minimum Term. In consideration of the mutual covenants contained in this Agreement, and the Sublette Center’s agreement to enter into the lease described above, the County and District each hereby commit and agree to remain participating agencies of the Joint Powers Board for at least seven (7) consecutive years from the Effective Date, or the term of the Sublette Center lease, whichever is longer.
B. Termination. After expiration of the initial seven (7) year term set out above in subsection A, this Agreement and the Joint Powers Board may be terminated and dissolved as set forth in section XV of this Agreement upon the occurrence of any of the following events:
1. By joint action of the participating agencies; or
2. By the County or District provided at least twelve (12) months advance written notice of its intent to withdraw to the other party.
XV. Dissolution and Distribution. Upon termination of this Agreement as set forth in section XIV, the affairs and operations of the Joint Powers Board shall be wound up in an orderly manner. Dissolution and distribution of assets shall be subject to the following requirements:
A. All funds, assets, and/or facilities owned by the Joint Powers Board shall be collected and marshalled by the Joint Powers Board, and the Joint Powers Board shall give reasonable notice to creditors and those persons that have or may have claims against the Joint Powers Board to present such claims within a reasonable time. The Joint Powers Board shall liquidate any such assets as are necessary to satisfy such claims and/or liabilities.
B. After all such claims and/or liabilities are satisfied, all remaining assets (and, all claims and/or liabilities remaining after all assets have been liquidated and used to satisfy such claims and/or liabilities) shall be allocated and distributed to the County and District, proportionately equal to the then current capital accounts of the County and District, or as may be expressly agreed by resolution of the governing bodies of the County and District on a specific property-by-property basis.
C. Any dissolution must provide for the orderly and safe transition of services to patients of the Hospital’s facilities.
D. Notwithstanding anything to the contrary contained herein, this Agreement and the Joint Powers Board created hereunder cannot and shall not be dissolved or terminated as long as any outstanding financial obligations of the Joint Powers Board remain unpaid or adequate provision for the payment thereof has not been made.
XVI. Warranties and Representations. Each participating agency hereby warrants and represents to each other participating agency that:
A. Its governing body has the statutory authority and power to engage in the purposes of the Joint Powers Board created by this Agreement, as required by the Act.
1. The County’s statutory authority and purposes are as set forth in Wyoming Statutes, including but not limited to Wyo. Stat. Ann. § 18-2-101 et seq, and include creation of a county memorial hospital;
2. The District’s statutory authority and purposes are as set forth in Wyo. Stat. Ann. § 35-2-701 et seq., including but not limited to Wyo. Stat. Ann. § 35-2-703(a)(xi)[JH16] , and include ownership and operation of a hospital.
B. Under Wyoming common law, as described in Mariano & Assoc., P.C. v. County of County Commissioners of the County of Sublette, 737 P.2d 323 (Wyo. 1987), Wyoming governmental entities may void some agreements entered into that extend beyond the terms of the members of the present governing bodies of such entities. However, both parties agree that creation of this Agreement, including its duration extending beyond the term of the currently elected and potential future elected members of the Hospital’s governing body, is reasonably necessary and of a definable advantage to each party, and is in the best interests of the citizens of Sublette County, and shall be effective throughout its duration by both parties, and neither void nor voidable.
XVII. Effective Date. This Agreement, and any amendment hereto, shall become effective upon the completion of all of the following:
A. Approval of the governing bodies of the County and District;
B. Approval by the Wyoming Attorney General; and
C. The filing of this Agreement with the keeper of records of the County and District.
XIII. Third Party Beneficiary. The participating agencies acknowledge and agree that Sublette Center is an express third party beneficiary of this Agreement due to the necessity of utilizing Sublette Center facilities as part of the Hospital. Sublette Center shall have the right to enforce the terms of this Agreement as if it were a party hereto. Other than Sublette Center, the parties do not intend to create in any other individual or entity the status of third party beneficiary, and this Agreement shall not be construed so as to create such status.
XIX. Amendment. This Agreement may be amended, in whole or in part, only by written resolution jointly approved by the governing bodies of the County and District, and with the approval of the Wyoming Attorney General’s office. The Joint Powers Board anticipates amending this Agreement, by supplemental appendix, to address specific concerns and issues, as needs associated with the efficient delivery and operation of a critical access hospital in Sublette County may dictate or require.
XX. Severability. The terms, provisions, and conditions of this Agreement are severable. If any term or provision of this Agreement or its application to any person or circumstance is determined by a court of proper jurisdiction to be invalid, such invalidation shall be limited to such person, circumstance, term or provision, and shall not affect other persons, circumstances, terms or provisions which can be given effect without the invalid provision or application.
XXI. Governmental/Sovereign Immunity. The governmental parties to this Agreement do not waive their governmental and/or sovereign immunity, as provided by any applicable law including Wyo. Stat. Ann. § 1-39-101 et seq., by entering into this Agreement. Further, the parties fully retain all immunities and defenses provided by law with regard to any action, whether in tort, contract, or any other theory of law, based on this Agreement.
XXII. Counterparts. This Agreement may be signed in separate counterparts.
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SUBLETTE COUNTY CRITICAL ACCESS HOSPTIAL
JOINT POWERS BOARD AGREEMENT
FOR SUBLETTE COUNTY:
DATED AND APPROVED this ___ day of ___________, 2016.
Name, Chairman, Board of County Commissioners,
County of Sublette, Wyoming
Name, Sublette County Clerk
FOR SUBLETTE COUNTY RURAL HEALTH CARE DISTRICT:
DATED AND APPROVED this ___ day of ___________, 2016.
[Chair, Board of Trustees]
Name, Secretary of Board of Trustees
ATTORNEY GENERAL OF WYOMING
APPROVAL PURSUANT TO WYO. STAT. §16-1-105(a)(iii)
In accordance with Wyo. Stat. §16-1-105(a)(iii), this Joint Powers Agreement has been reviewed by the Attorney General of Wyoming, and the Attorney General has determined that the Agreement is compatible with the laws and the Constitution of the State of Wyoming. The approval of this Agreement by the Attorney General is limited to the terms and conditions of the Agreement itself and the approval does not extend to any individual project, nor the financing of any individual project, contemplated under the agreement.
APPROVED this ___day of ____________, 2016.
STATE OF WYOMING:
Terms to be included in lease of Sublette Center’s facilities:
I. Minimum term. The lease shall have a minimum initial term of seven (7) years, non-terminable except for breach.
II. Option to renew. Upon expiration of the initial term, the Board shall have the option to renew the lease for one (1) additional five (5) year term.
III. Rent. The rent payable to Sublette Center for lease of the facilities shall be one dollar ($1.00) per year[NH7] ;
IV. Minimum investment. The Board shall, at a minimum, invest at least one million dollars ($1,000,000) in improvements to the leased facilities’ physical plant, over the initial seven (7) year term. Such leasehold improvements shall inure to the benefit of Sublette Center, and remain with Sublette Center at termination of the lease, unless Sublette Center terminates the lease before the end of the initial term, in which case Sublette Center shall pay the Board the reasonable value of such improvements, less the sum of one hundred forty-two thousand, eight hundred fifty-seven dollars ($142,857) per year the lease is in effect.
V. Covenant not to compete. The participating agencies acknowledge and agree:
· that the Joint Powers Board’s Hospital will provide services reimbursed under Medicare Part A, which will compete with the services traditionally provided by Sublette Center, and which provide a significant portion of Sublette Center’s operating revenue;
· Successful operation of the Hospital requires Sublette Center’s involvement and lease of Sublette Center’s facilities, and that Sublette Center will not be able to provide such services during the term of the lease while the Hospital is providing such services, and will be substantially disadvantaged in providing such services after the term of the lease as a substantial portion of Sublette Center’s goodwill connected with providing such services will accrue to the Hospital;
· Sublette Center is willing to lease its facilities to the Board, notwithstanding this substantial disadvantage, in part in order to benefit the community;
· The participating agencies, and the Board, and Sublette Center, are thus in a special and unique position of trust by virtue of such lease, which position of trust requires that the participating agencies, the Board and Sublette Center work cooperatively and not against the others, and justifies this covenant not to complete.
The Board, and each participating agency, therefore agrees and covenants that, for a period of five (5) years after the termination of the lease, none of the Board, the District, or County, shall, directly or indirectly, engage in the practice of or provide skilled nursing facility care, or nursing facility care, in Sublette County, Wyoming, if Sublette Center is providing such services. Sublette Center may, in its sole discretion, waive this covenant in whole or in part.
[RL1]Is it a requirement of Sublette Center that its directors or officers must be a qualified elector of Sublette County? If not, what do you do if less than three of these directors or officers are qualified electors of Sublette County?
[RL2]Just a thought here. With this set up, you will roll all three District appointees every three years. Seems you may want to balance this better so that you are rolling one from each group each year with two rolling from the County selection every three years.
[RL3]You will need to make sure that the language allows for the transfer of the licensure or the obtaining of a new nursing home license. This will be necessary as the only way you can procure potential IGT funds is through a nursing home that is licensed under a governmental entity.
[RL4]We were not thinking that all staff of both entities would be part of the home office. If this is the case, we would have to recommend health care legal counsel review this arrangement as there are some potential issues with non-employed care providers with offsite locations (i.e. Marbleton). Even though it is a related party and should be okay, I would be concerned here and want to have someone with health care legal experience review this portion.
[RL5]This would not be a recommended option as in the single entity model. We lose the opportunity to argue a home office option if everything is under one roof.
Ultimately, you would either have two or three entities. The NH and the Hospital entities are two of the entities. The question is on the home office staff. If Noridian allows for it, we would recommend they be reported in one of the other two existing entities. However they have, at times, required these be in separate entities which could require the third entity.
[JH16]We can’t cite this until July 1, 2016.
[NH7]Just to double check, the Sublette Center doesn’t have ongoing expenses that this will leave it without the funds to pay, does it?