Docstoc

Governance _ Management_ Brad Berg - Association of Washington

Document Sample
Governance _ Management_ Brad Berg - Association of Washington Powered By Docstoc
					Association of Washington Public Hospital Districts
       Retreat for CEOs and Administrators

          “Leading Wisely, Living Well”
              Cave B Inn at SageCliffe,
                Quincy, Washington
                   May 2-4, 2006


         Public Hospital District
       Governance and Management
                    By Brad Berg
                    May 3, 2006

                                                      1
OVERVIEW OF PHD GOVERNANCE & MANAGEMENT


  Legal duties and responsibilities
  Legal powers and authority
  Legal rights
  Liabilities and penalties




                                          2
LEGAL CHARACTERISTICS OF PHDs


 PHDs are municipal corporations and
  political subdivisions of the State
 Powers are limited to those expressly granted
  by the legislature and those necessarily
  implied
 Limitations on both what PHDs are permitted
  to do and how they do it


                                                  3
LEGAL NATURE OF A PUBLIC HOSPITAL DISTRICT, cont.

  PHDs are similar to other governmental
   subdivisions (e.g., cities, counties, school
   districts, port districts, public utility
   districts), but there are differences
  PHDs are significantly different than non-
   profit and for-profit corporations




                                                    4
SOURCES OF LAW AND GUIDANCE


   State Constitution
   PHD statute
   Other applicable statutes
     – Open Public Meetings Act
     – Public Records Act
     – Code of Ethics
     – Etc.


                                  5
SOURCES OF LAW AND GUIDANCE, continued


     Common law
     Governing board bylaws
     Board resolutions
     Board policies and procedures




                                         6
GOVERNANCE AND MANAGEMENT FRAMEWORK

  PHD Board is the legislative body
   responsible for all legislative or general
   policy matters

  Superintendent is the administrative
   officer responsible for all administrative
   matters




                                                7
GOVERNANCE AND MANAGEMENT FRAMEWORK, cont.

  Corporate entity versus Board and
  Superintendent:

   Some powers are granted to (and duties
    imposed on) the corporate entity

   Others are granted to or imposed on the
    Board or Superintendent



                                              8
GOVERNANCE AND MANAGEMENT FRAMEWORK, cont.


 Generally, the powers of a municipal
  corporation are vested in the governing
  body unless expressly delegated to some
  other officer or body by statute or action
  of the governing body




                                               9
AUTHORITY OF THE BOARD AND ITS COMMISSIONERS


  The Board may act only as a collective body
   – Commissioners have no individual legal
     authority to act on behalf of the PHD

  The Board’s actions may have no legal effect
   and may be void if the Board fails to comply
   with applicable laws, PHD bylaws,
   resolutions, policies and procedures


                                                  10
CRITICAL LAWS AND PROCEDURES

 Open Public Meetings Act

    Regular meetings
    Special meetings
    Adjourned meetings
    Public hearing requirements
    Executive sessions
    Use of board committees

                                   11
CRITICAL LAWS AND PROCEDURES, cont.

 Approval by majority vote of entire
  Commission (RCW 70.44.050)
 Approval at the proper type of meeting
  (e.g., regular vs. special meeting) following
  presentation at prior meeting if required by
  statute
 Approval following statutorily mandated
  procedures -- e.g., notice, public hearing, etc.

                                                     12
CRITICAL LAWS AND PROCEDURES, cont.

 Approval in compliance with any special
  procedure established by bylaws, resolution,
  motion or other policy
 Action and approval must be in the form of
  a motion or resolution
 Minutes of regular and special meetings
  must be recorded promptly and be open to
  public inspection

                                                 13
STATUTORY DUTIES OF COMMISSIONERS

PHD actions requiring approval of the
Commission by resolution (Ch. 70.44 RCW):
 1. Abolishing commissioner districts
    (RCW 70.44.042)
 2. Filling vacancies on Commission
    (RCW 70.44.045)
 3. Establishing commissioner compensation
    (RCW 70.44.050)
                                             14
STATUTORY DUTIES OF COMMISSIONERS, cont.

4. Electing the Commission president and
   secretary (RCW 70.44.050)
5. Adopting bylaws governing the
   Commission’s business (RCW 70.44.050)
6. Increasing size of Commission
   (RCW 70.44.053)
7. Exercising power of eminent domain and
   condemnation (RCW 70.44.060)

                                            15
STATUTORY DUTIES OF COMMISSIONERS, cont.


8. Leasing of hospital or other health care
   facilities (RCW 70.44.060(3))
9. Establishing rates for the services provided
   by the district (RCW 70.44.060(3))
10. Incurring debt (RCW 70.44.060(5))
11. Levying taxes (RCW 70.44.060(6))
12. Increases in regular levy (RCW 84.55.120)

                                                  16
STATUTORY DUTIES OF COMMISSIONERS, cont.

13. Preparing an annual budget, holding a
    hearing on the budget and approving the
    budget (RCW 70.44.060(6))
14. Appointing a superintendent, removing the
    superintendent and establishing the
    superintendent’s compensation (RCW
    70.44.060)
15. Approving plans to acquire or construct
    district facilities (RCW 70.44.110)
                                                17
STATUTORY DUTIES OF COMMISSIONERS, cont.

16. Awarding construction contracts that have an
    estimated cost in excess of $50,000
    (RCW 70.44.140)
17. Appointing the district’s treasurer and
    internal auditor (RCW 70.44.171)
18. Approving orders or vouchers pursuant to
    which district funds are disbursed
    (RCW 70.44.171)

                                               18
STATUTORY DUTIES OF COMMISSIONERS, cont.


19. Designating the bank at which all district
    funds are deposited (RCW 70.44.171)
20. Approving consolidation of a district with
    another district (RCW 70.44.190)
21. Approving the annexation of additional
    territory into the district (RCW 70.44.200)



                                                  19
STATUTORY DUTIES OF COMMISSIONERS, cont.


22. Approving the sale of surplus real or personal
    property (RCW 70.44.300 and RCW 70.44.320)
23. Approving lease of surplus real property
    (RCW 70.44.310)
24. Approving the dividing of a district into two
    or more districts (RCW 70.44.350)



                                                    20
STATUTORY DUTIES OF COMMISSIONERS, cont.



25. Calling for an election (RCW 29A.04.330)

26. Other statutory requirements applicable to
    municipal corporations generally




                                                 21
COMMON LAW DUTIES OF COMMISSIONERS


 Generally, officers of municipal corporations
  have only such duties as are conferred upon
  them expressly or by necessary implication
  by applicable statutes

 Courts have held public office to be
  synonymous with public trust and that a
  public officer’s relationship with the public is
  that of a fiduciary

                                                     22
RIGHTS OF COMMISSIONERS


Statutory rights of commissioners:
 Compensation
 Health, life and other insurance




                                     23
RIGHTS OF COMMISSIONERS


 Other rights of commissioners:
  Indemnification
  Liability insurance




                                  24
STATUTORY POWERS AND DUTIES OF SUPERINTENDENT


  The superintendent “shall be the chief
   administrative officer of the public hospital
   district and shall have control of the
   administrative functions of the district.”

  The superintendent “shall be responsible to
   the commission for the efficient
   administration of all affairs of the district.”


                                                     25
STATUTORY DUTIES OF SUPERINTENDENT, cont.

The PHD Statute provides that the superintendent
shall have the power and duty to do the following:

1. Carry out the orders of the commission, and
   see that all the laws of the state pertaining to
   matters within the functions of the district
   are duly enforced




                                                      26
STATUTORY DUTIES OF SUPERINTENDENT, cont.

2. Keep commission fully advised as to the
   financial condition and needs of district
3. Prepare, each year, an estimate for the ensuing
   fiscal year of the probable expenses of district
4. Recommend to commission what develop-
   ment work should be undertaken and what
   extensions and additions, if any, should be
   made during ensuing fiscal year, and estimate
   cost of same
                                                27
STATUTORY DUTIES OF SUPERINTENDENT, cont.


5. Certify to commission all bills, allowances
   and payrolls, including the claims due to
   contractors of public works
6. Recommend to commission a range of
   salaries to be paid to district employees




                                                 28
COMMON LAW DUTIES OF SUPERINTENDENT


 Similar to commissioners, the legal duties of
 superintendents are generally limited to those
 specified by statute or action of the board




                                                  29
RIGHTS OF SUPERINTENDENT

 Compensation fixed by resolution of the
  board
 Appointment and removal must be by
  resolution introduced at one regular meeting
  and before being adopted at a subsequent
  regular meeting
 Other rights specified by contract or other
  action of the board

                                                 30
LIABILITIES AND IMMUNITIES OF COMMISSIONERS
AND SUPERINTENDENT


Public officers and employees, like other
persons, are generally accountable for their
actions under civil and criminal laws




                                               31
LIABILITIES AND IMMUNITIES, cont.

Certain statutes create unique liabilities for
public officers and employees:
 Criminal statutes:
  – Bribery
  – Bidding offenses
  – Delegation of powers for profit
  – Filing false report or making false certificate
  – Falsely auditing and paying claims

                                                 32
LIABILITIES AND IMMUNITIES, cont.


 – Misappropriation and falsification of
   accounts
 – Willfully disobeying any provision of law
 – Willful neglect of duty imposed by law
 – Approving or paying a false claim
 – Making a false claim


                                               33
LIABILITIES AND IMMUNITIES, cont.


 Open Public Meetings Act violations:

  “Each member of the governing body who
   attends a meeting of such governing body
   where action is taken in violation of any
   provision of this chapter with knowledge of
   the fact that the meeting is in violation
   thereof, shall be subject to personal liability
   in the form of a civil penalty in the amount
   of $100.”
                                                     34
LIABILITIES AND IMMUNITIES, cont.


  Violations of Public Bid Statute:
   – Any commissioner or officer who
   knowingly makes any false entry in any
   account or record required by the public bid
   statute or who knowingly certifies any false
   statement in any certificate required by the
   statute will be guilty of a misdemeanor



                                                  35
LIABILITIES AND IMMUNITIES, cont.

Violations of Conflict of Interest Statute:
  – Any officer violating the conflict of interest
    statute is liable to the municipality of which
    he or she is an officer for a penalty in the
    amount of $500, in addition to such other
    civil or criminal liability of penalty as may
    otherwise be imposed by law
  – May also be grounds for forfeiture of office

                                                   36
LIABILITIES AND IMMUNITIES, cont.


 Other prohibited acts under the Code of
 Ethics Statute:

  – No municipal officer may use his or her
    position to secure special privileges or
    exemptions for himself, herself, or
    others




                                               37
LIABILITIES AND IMMUNITIES, cont.


  – No municipal officer may, directly or
    indirectly, give or receive or agree to
    receive any compensation, gift, reward or
    gratuity from a source except the
    employing municipality, for a matter
    connected with or related to the officer's
    services as such an officer unless otherwise
    provided for by law


                                                   38
LIABILITIES AND IMMUNITIES, cont.


 – No municipal officer may accept
   employment or engage in business or
   professional activity that the officer might
   reasonably expect would require or induce
   him or her by reason of his or her official
   position to disclose confidential information
   acquired by reason of his or her official
   position


                                               39
LIABILITIES AND IMMUNITIES, cont.


  – No municipal officer may disclose
    confidential information gained by
    reason of the officer's position, nor may
    the officer otherwise use such
    information for his or her personal gain
    or benefit




                                                40
LIABILITIES AND IMMUNITIES, cont.


  A vacancy in the office of commissioner
   shall occur by nonattendance at meetings
   of the commission for sixty days, unless
   excused by the commission
   - Misfeasance
   - Malfeasance
   - Tort Claims



                                              41
LIABILITIES AND IMMUNITIES, cont.


 State and federal civil rights laws such
  as 42 U.S.C. § 1983:
  - Violations of other federal or state laws




                                                42
 LIABILITIES AND IMMUNITIES, cont.

RCW 4.24.470 provides immunity for discretionary
decisions
An appointed or elected official or member of the
governing body of a public agency is immune from
civil liability for damages for any discretionary
decision or failure to make a discretionary decision
within his or her official capacity, but liability shall
remain on the public agency for the tortious
conduct of its officials or members of the governing
body
                                                      43
LIABILITIES AND IMMUNITIES, cont.


 Other forms of protection
    Indemnification
    Directors and Officers Liability
     Insurance




                                        44
BEST PRACTICES FOR GOVERNANCE AND MANAGEMENT

 Understand statutory legal powers, duties and
  liabilities and the division of responsibility
 Where statutes are silent regarding allocation
  of responsibilities, expressly address same in
  bylaws, policies and other procedures
 Consider preparing and adopting a detailed
  authority grid
 Consider using the annual budget as a means
  of delegating authority to management

                                               45
Questions?




             46
CONTACT INFORMATION


Bradley J. Berg
Telephone: 206-447-8970
Email: Bergb@Foster.com

Foster Pepper PLLC
1111 Third Avenue, Suite 3400
Seattle, WA 98101
www.foster.com




                                47