House Introduced Bill 5896

HOUSE BILL No. 5896


     May 28, 1998, Introduced by Rep. Anthony and referred to the Committee on Health Policy.


        A bill to amend 1987 PA 230, entitled

   "Municipal health facilities corporations act,"

   by amending section 209 (MCL 331.1209), as amended by 1994 PA

   398.

               THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 1         Sec. 209.  (1) Each board of trustees of a corporation and

 2    EACH subsidiary board OF TRUSTEES of a subsidiary corporation

 3    shall consist of not fewer than 5 or more than 15 trustees.  The

 4    exact number of trustees and the length of their terms of office

 5    shall be as specified in the articles of incorporation or as pro-

 6    vided in section 203(1).  Except for the initial appointments to

 7    boards of trustees and subsidiary boards OF TRUSTEES of newly

 8    incorporated corporations and NEWLY INCORPORATED subsidiary

 9    corporations, terms of office begin on January 1.  The term of

10    office of a trustee appointed to fill a vacancy on a board of


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 1    trustees or subsidiary board OF TRUSTEES of a corporation or

 2    subsidiary corporation established by a county begins upon

 3    appointment and  shall continue  CONTINUES for the remainder of

 4    the term of the former trustee whose position became vacant.

 5    Terms of office shall be staggered so that an approximately equal

 6    number of terms expire at the end of each year or each 2 years,

 7    except that terms may be fixed so that the shortest terms do not

 8    expire until the end of the second year following the incorpora-

 9    tion of a corporation or a subsidiary corporation.

10    Notwithstanding any other provision of this subsection,  all

11     trustees  EACH TRUSTEE shall serve until  their successors are 

12    HIS OR HER SUCCESSOR IS appointed.  In the case of corporations

13    governed by  Act No. 350 of the Public Acts of 1913, being

14     sections 331.151 to 331.169 of the Michigan Compiled Laws  1913

15    PA 350, MCL 331.151 TO 331.169, on February 27, 1988, the chief

16    executive of the corporation shall serve as a member of the board

17    of trustees until and unless the duly adopted articles of incor-

18    poration provide otherwise, and in other cases the chief execu-

19    tive officer of a corporation or subsidiary corporation estab-

20    lished by a county is eligible to serve on the board of trustees

21    or ON a subsidiary board OF TRUSTEES, either by appointment or,

22    if provided in the articles of incorporation, ex officio.

23         (2) Upon incorporation of a corporation by a county pursuant

24    to this act, the county board of commissioners shall appoint

25    trustees to all positions on the board of trustees.  Adoption of

26    articles of incorporation for a corporation succeeding a county

27    public hospital organized and existing under  Act No. 350 of the



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 1    Public Acts of 1913 or under Act No. 109 of the Public Acts of

 2     1945, being sections 331.201 to 331.213 of the Michigan Compiled

 3     Laws  1913 PA 350, MCL 331.151 TO 331.169, OR UNDER 1945 PA 109,

 4    MCL 331.201 TO 331.213, on February 27, 1988 does not constitute

 5    incorporation of a corporation for purposes of this subsection.

 6    The terms of office of trustees serving on the board of such a

 7    county public hospital shall not be diminished, except that the

 8    adopted articles may prospectively establish new lengths of terms

 9    of office for the board of trustees, and may prospectively alter

10    the board size.  Nominations  EXCEPT AS OTHERWISE PROVIDED IN

11    SUBSECTION (3), NOMINATIONS for a position on a board of trustees

12    or subsidiary board OF TRUSTEES of a corporation or OF A subsid-

13    iary corporation established by a county, other than an ex offi-

14    cio position filled by a chief executive officer, shall be made

15    by THE BOARD OF TRUSTEES OR SUBSIDIARY BOARD OF TRUSTEES submit-

16    ting the names of 3 qualified nominees to the county board of

17    commissioners.  During the September immediately preceding the

18    expiration of a term of office on the board of trustees or sub-

19    sidiary board OF TRUSTEES of a corporation or OF A subsidiary

20    corporation established by a county, that board of trustees or

21    subsidiary board OF TRUSTEES shall make nominations for each

22    position for which the term of office is about to expire.  Upon

23    creation of a vacancy on the board of trustees or subsidiary

24    board OF TRUSTEES of a corporation or OF A subsidiary corporation

25    established by a county, that board of trustees or subsidiary

26    board shall make nominations for the vacant position.  Upon 

27    EXCEPT AS OTHERWISE PROVIDED IN SUBSECTION (3), UPON



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 1    incorporation of a subsidiary corporation by a county, the board

 2    of trustees of the parent corporation shall make nominations for

 3    each position on the new subsidiary board OF TRUSTEES.  The

 4    county board of commissioners, at a meeting in that MONTH or IN

 5    the following month, shall consider the nominations MADE UNDER

 6    THIS SUBSECTION OR SUBSECTION (3) and shall make appointments to

 7    the board of trustees or subsidiary board OF TRUSTEES from among

 8    the persons nominated, as considered appropriate by the county

 9    board of commissioners.  The county board of commissioners is not

10    required to fill a position with 1 of the 3 persons nominated,

11    but if it declines to do so,  it  THE COUNTY BOARD OF

12    COMMISSIONERS shall consider nominees and request additional nom-

13    inees in the manner provided in this subsection OR SUBSECTION (3)

14    until the position is filled.

15         (3) IN A COUNTY WITH A POPULATION OF FEWER THAN 100,000, THE

16    COUNTY BOARD OF COMMISSIONERS MAY SOLICIT QUALIFIED NOMINEES FOR

17    APPOINTMENT TO THE BOARD OF TRUSTEES OR SUBSIDIARY BOARD OF

18    TRUSTEES OF A CORPORATION OR OF A SUBSIDIARY CORPORATION FROM ANY

19    SOURCE CONSIDERED APPROPRIATE BY THE COUNTY BOARD OF

20    COMMISSIONERS.

21         (4)  (3) All trustees  EACH TRUSTEE of  corporations and

22     subsidiary corporations  A CORPORATION OR A SUBSIDIARY

23    CORPORATION established by a county shall be chosen with refer-

24    ence to  their  HIS OR HER fitness for the office, but not more

25    than 1/3 of the trustees serving at any 1 time shall be direct

26    providers of health care.  Trustees  EACH TRUSTEE shall be

27     citizens  A CITIZEN of the county CHOOSING THE TRUSTEE, unless



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 1    the articles of incorporation permit  individuals  AN INDIVIDUAL

 2    who  are  IS not  citizens  A CITIZEN of the county to be

 3     trustees  A TRUSTEE.  Trustees  A TRUSTEE of the parent corpo-

 4    ration, the chief executive officer of the parent corporation,

 5    and the chief executive officer of a subsidiary corporation are

 6    eligible for appointment to a subsidiary board OF TRUSTEES and a

 7    trustee or chief executive officer of a parent corporation  are 

 8    IS eligible for appointment as chief executive officer of a sub-

 9    sidiary corporation, and these offices are not incompatible.

10     Trustees are  A TRUSTEE IS eligible for reappointment.

11         (5)  (4)  Before the tenth day after commencement of  their 

12    HIS OR HER term of office,  trustees  EACH TRUSTEE shall qualify

13    by taking the oath provided by section 1 of article XI of the

14    state constitution of 1963.

15         (6)  (5) Any  A trustee of a corporation established by a

16    county may be removed from office for cause either by vote of a

17    majority of the members then serving on the county board of com-

18    missioners or by vote of a majority of the members then serving

19    on the board of trustees of the corporation.  Any trustees  A

20    TRUSTEE of a subsidiary corporation incorporated by a county may

21    be removed from office for cause either by vote of a majority of

22    the members then serving on the county board of commissioners or

23    by vote of a majority of the members then serving on the board of

24    trustees of the parent corporation.  As used in this subsection,

25    "cause" includes, but is not limited to, incompetency to properly

26    exercise duties; official misconduct; or habitual or willful

27    neglect of duty, including but not limited to, failure to attend



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 1    meetings, including committee meetings, in accordance with

 2    standards determined from time to time by the board of trustees

 3    of the corporation or subsidiary board OF TRUSTEES OF A SUBSID-

 4    IARY CORPORATION.

 5         (7)  (6)  A trustee shall not be removed from office UNDER

 6    SUBSECTION (6) on grounds of misconduct or neglect unless the

 7    trustee is served with a notice of hearing and a copy of the

 8    asserted ground for removal, and is given full opportunity to be

 9    heard, either in person or by counsel, before a vote is taken on

10    the question of removal from office.




































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