HOSPITAL DISTRICTS ‑- INDEBTEDNESS ‑- LIMITATIONS

HOSPITAL DISTRICTS ‑- INDEBTEDNESS ‑- LIMITATIONS

1. The maximum bonded indebtedness which can be authorized by the voters in hospital districts is five percent of the assessed valuation of the property in the district.

2. In determining maximum bonded indebtedness, no consideration need be given to the existing indebtedness against the property created by other taxing districts.

3. The commissioners of a hospital district have no authority to call a special election to authorize the issuance of bonds.

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                                                               December 15, 1954

Honorable Jay Roy Jones
Prosecuting Attorney-elect
Pend Oreille County
Knuth Building
Newport, Washington                                                                                                              Cite as:  AGO 53-55 No. 363

Dear Sir:

            You requested our advice on the following questions:

            1. What is the maximum bonded indebtedness which can be incurred by hospital districts as authorized by the vote of the people?

            2. What consideration, if any, must be given to the existing indebtedness of the area included in the hospital district, which was created by other taxing districts?

            3. May the commissioners of a hospital district call an election on a bond issue at any time?

             [[Orig. Op. Page 2]]

            Our conclusions are as follows:

            1. The maximum bonded indebtedness for a hospital district is five percent of the assessed valuation of the property in the district.

            2. No consideration need be given to the existing indebtedness against the property created by other taxing districts.

            3. The commissioners of a hospital district have no authority to call a special election to authorize the issuance of bonds.

                                                                     ANALYSIS

            RCW 70.44.120 authorizes the issuance of bonds for a hospital district.  RCW 70.44.110 limits the general indebtedness of a district to one and one‑half percent of the taxable property without a vote of the people, but authorizes an indebtedness in excess of that amount upon the approval of the electors district.  No maximum is imposed by statute in the case of an indebtedness approved by the electors.  Amendment 27 is the general constitutional limitation upon the maximum aggregate indebtedness of taxing districts.  The percentage fixed therein is one and one‑half percent without a vote of the electors, and five percent with such a vote.  The legislature having provided no lesser maximum, hospital districts are limited by the constitution to an aggregate indebtedness, where authorized by a vote of the electors in the district, to not exceeding five percent of the assessed value of the property in the district.

            Your second question is also answered by the express language of Amendment 27 to the Washington Constitution.  It is therein provided that any county, city, town, school district, or other municipal corporation may increase that total indebtedness, with a vote of its electors, to five percent of the assessed value of the property in that particular district.  Hospital districts are created as municipal corporations under RCW 70.44.010 and fall within the meaning of this provision.  Therefore, each and every taxing district included within the contemplation of Amendment 27, may incur its own indebtedness to the amount limited therein, without regard to the amount of indebtedness previously incurred by other taxing districts.

             [[Orig. Op. Page 3]]

            Your third question is answered by the express provisions of RCW 70.44.110, providing, in part, as follows:

            "* * * If the proposed general indebtedness will bring the indebtedness of the district to an amount exceeding one and one‑half percent of the taxable property of the district,the proposition of incurring the indebtedness and the proposed plan shall be submitted to the electors of the district at thenext general election held in the district."  (Emphasis supplied)

            The statute expressly provides that any proposition incurring an indebtedness in excess of one and one‑half percent shall be submitted to the electors at thenext general election held in the district.  Therefore, the hospital district commissioners have no authority to call a special election for this purpose.

Very truly yours,

DON EASTVOLD

Attorney General

RALPH M. DAVIS

Assistant Attorney General