CHAPTER 271

An Act to create the Chesapeake Hospital Authority; provide for appoint-
ment and terms of office of members of the Authority and for election
of certain officers; to prescribe the powers and duties of the Authority
encluding the power to borrow money and issue bonds; and to au-
thorize certain cities to exercise certain powers m cooperation with
the Authority.

[H 411]

Approved March 31, 1966

Be it enacted by the General Assembly of Virginia:

1. 81. There is hereby created a public body politic and corporate to
be known as the “Chesapeake Hospital Authority” hereinafter referred to
as “The Authority”, with such public and corporate powers as are herein-
after set forth. The Authority may sue and be sued, plead and be impleaded,
and shall have the power and authority to contract and be contracted with
and to exercise and discharge all the powers and duties imposed and con-
ferred upon it, as hereinafter provided.

§ 2. The Authority shall be composed of seven members, two of
whom shall be licensed members of the medical profession, who shall be
appointed by the city council; four of the members first appointed shall be
appointed for terms of four years and three for terms of two years. There-
after, the terms of the members shall be four years. Any such member
appointed for a four year term may be reappointed for one additional
four year term. Thereafter, no member shall be reappointed until at least
one year after the expiration of his second full four year term. Members
shall receive no salaries but shall be entitled to reimbursement for neces-
sary traveling and other expenses incurred while engaged in the perform-
ance of their duties. Each member shall continue to hold office until his
successor has been appointed and qualified. The council shall have the
right to remove any member or officer, for malfeasance or misfeasance,
incompetency or gross neglect of duty. Vacancies shall be filled by appoint-
ment of the council for unexpired terms. Members shall take an appro-
priate oath of office and same shall be filed with the city clerk. Members
shall elect on an annual basis one of their number as chairman and another
as vice chairman and shall also elect a secretary and treasurer for terms
to be determined by them, who may or may not be one of the members.
The same person may serve as both secretary and treasurer. The members
shall make such rules, regulations and bylaws for their own government
and procedure as they shall determine; they shall meet regularly at least
once a month and may hold such special meetings as they deem necessary.

§ 3. The Authority shall be deemed to be a public instrumentality,
exercising public and essential governmental functions to provide for the
public health and welfare, and is hereby authorized to exercise the powers
conferred by the following sections.

§ 4. The Authority may plan, design, construct, remove, enlarge,
equip, maintain and operate hospital and medical facilities, including addi-
tional facilities for nurses, interns, physicians and surgeons, together with
related and supporting facilities and to do all things necessary and con-
venient to carry out any of its purposes.

§ 5. The Authority may acquire, property real or personal, by pur-
chase, gift, devise or by the exercise of the power of eminent domain, on
such terms and conditions, and in such manner as it may deem proper, and
such rights, easements or estates therein as may be necessary for its pur-
poses, and sell, lease and dispose of the same, or any portion thereof or
interest therein whenever it shall become expedient to do so. The exercise of
the right of eminent domain shall be in accordance with Chapter 1.1 of
Title 25 of the Code of Virginia. The power shall be exercised only within
the corporates limits of the city of Chesapeake. No property of any cor-
poration itself having the power of eminent domain may be condemned
hereunder.

§ 6. The Authority may fix and revise from time to time and charge
and collect rates, rentals, fees and other charges for the services and facil-
ities furnished by the Authority, and establish and revise from time to
time regulations, in respect to the use, occupancy or operation of any such
facility or part thereof, or service rendered.

§ 7. The Authority may accept loan, grants, or assistance from the
federal government, the State, any municipality thereof, or from any other
sources, public or private, to carry out any of its purposes and may enter
into any agreement or contract regarding or relating to the acceptance or
use or repayment of any such loan, grant or assistance.

§ 8. The Authority may borrow money and issue bonds as herein-
after provided.

§ 9. In addition to the powers granted by general law or by its
charter, any city located in the general section of the State to be served
by the Authority is empowered to cooperate with the Auhority as follows:

(a) To make such appropriations and provide such funds for the
operation and carrying out the purposes of the Authority as the council
may deem proper, either by outright donation or by loan, or the council
may agree with such Authority to take such action.

(b) To dedicate, sell, convey or lease any of its interest in property,
or or grant easements, licenses or any other privileges therein to any such

ority.

(c) To cause parks, playgrounds, recreational, community, educa-
tional, water, sewer or drainage facilities, or any other works which it is
otherwise empowered to undertake, to be furnished adjacent to or in con-
nection with property of or any facility of such Authority.

(d) To furnish, dedicate, close, pave, install, grade or regrade, plan or
replan streets, roads, roadways, alleys, sidewalks or other places which it
is otherwise empowered to undertake.

(e) Plan or replan, zone or rezone any part of such city in connection
with the use of any property of such Authority or any property adjacent
to the property of such Authority or any of its facilities which it is other-
wise empowered to undertake, in accordance with general laws.

(f) To cause services to be furnished to the Authority of the char-
acter which such city is empowered to furnish.

(g) To purchase any of the bonds of such Authority or legally invest
in such bonds any funds belonging to or within the control of such city and
exercise all the rights of any holder of such bonds.

(h) To do any and all things necessary or convenient to aid or cooper-
ate in the planning, undertaking, construction or operation of any of the
plans, projects or facilities of such Authority. ;

(i) To enter into agreements with such Authority respecting action
to be taken by such city pursuant to any of the above powers.

§ 10. The Authority is hereby authorized to issue bonds from time
to time in its discretion for the purpose of paying all or any part of the
cost of acquiring, purchasing, constructing, reconstructing, improving or
extending any project and acquiring necessary land and equipment there-
for. The Authority may issue such types of bonds as it may determine,
including (without limitating the generality of the foregoing) bonds pay-
able as to principal and interest: (a) from its revenues generally; (b)
exclusively from the income and revenues of a particular project; or (c)
exclusively from the income and revenues of certain designated projects,
whether or not they are financed in whole or in part from the proceeds
of such bonds.

Any such bonds may be additionally secured by a pledge of any grant
or contribution from a participating political subdivision, the Common-
wealth or any political subdivision, agency or instrumentality thereof, any
federal agency or any unit, private corporation, copartnership, associa-
tion, or individual, or a pledge of any income or revenues of the Authority,
or a mortgage of any project or other property of the Authority.

Neither the members of the Authority nor any person executing the
bonds shall be liable personally on the bonds by reason of the issuance
thereof. The bonds and other obligations of the Authority (and such
bonds and obligations shall so state on their face) shall not be a debt of
the Commonwealth or any political subdivision thereof and neither the
Commonwealth nor any political subdivision thereof other than the
Authority shall be liable thereon, nor shall such bonds or obligations be
payable out of any funds or properties other than those of the Authority.
The bonds shall not constitute an indebtedness within the meaning of any
debt limitation or restriction. Bonds of the Authority are declared to be
issued for an essential public and governmental purpose.

§ 11. Bonds of the Authority shall be authorized by resolution and
may be issued in one or more series, shall be dated, shall mature at such
time or times not exceeding forty years from their date or dates and shall
bear interest at such rate or rates not exceeding six per centum (6%) per
annum, as may be determined by the Authority, and may be made redeem-
able before maturity, at the option of the Authority at such price or prices
and under such terms and conditions as may be fixed by the Authority
prior to the issuance of the bonds. The Authority shall determine the
form of the bonds, including any interest coupons to be attached thereto,
and the manner of execution of the bonds, and shall fix the denomination
or denominations of the bonds and the place or places of payment of
principal and interest, which may be at any bank or trust company within
or without the Commonwealth. In case any officer whose signature or a
facsimile of whose signature shall appear on any bonds or coupons shall
cease to be such officer before delivery of such bond, such signature or
such facsimile shall nevertheless be valid and sufficient for all purposes
the same as if he had remained in office until such delivery. Notwith-
standing any of the other provisions of this act or any recitals in any
bonds issued under the provisions of this act, all such bonds shall be
deemed to be negotiable instruments under the laws of the Common-
wealth. The bonds may be issued in coupon or registered form or both,
as the Authority may determine, and provision may be made for the
registration of any coupon bonds as to principal alone and also as to
both principal and interest, and for the reconversion into coupon bonds
of any bonds registered as to both principal and interest. The Authority
may sell such bonds in such manner, either at public or private sale, and
for such price, as it may determine to be for the best interests of the

Authority, but no such sale shall be made at a price so low as to require
the payment of interest on the money received therefor more than six per
centum (6%), computed with relation to the absolute maturity or maturi-
ties of the bonds in accordance with standard tables of bond values,
excluding, however, from such computation the amount of any premium
to be paid on redemption of any bonds prior to maturity.

_ Prior to the preparation of definitive bonds the Authority may, under
like restrictions, issue interim receipts or temporary bonds, with or with-
out coupons, exchangeable for definitive bonds when such bonds shal]
have been executed and are available for delivery. The Authority may
also provide for the replacement of any bonds which shall become muti-
lated or shall be destroyed or lost. :

Bonds may be issued under the provisions of this act without obtain-
ing the consent of any commission, board, bureau or agency of the Com-
monwealth or of any political subdivision, and without any other pro-
ceedings or the happening of other conditions or things than those pro-
ceedings, conditions or things which are specifically required by this act.

$ 12. In the discretion of the Authority any bonds issued under
the provisions of this act may be secured by a trust indenture by way
of conveyance, deed of trust or mortgage of any project or any other
property of the Authority, whether or not financed in whole or in part
from the proceeds of such bonds, or by a trust agreement by and
between the Authority and a corporate trustee, which may be any trust
company or bank having the powers of a trust company within or with-
out the Commonwealth or by both such conveyance, deed of trust or
mortgage and indenture or trust agreement. Such trust indenture or
agreement, or the resolution providing for the issuance of such bonds
may pledge or assign fees, rents and other charges to be received. Such
trust indenture or agreement, or resolution providing for the issuance of
such bonds, may contain such provisions for protecting and enforcing the
rights and remedies of the bondholders as may be reasonable and proper
and not in violation of law, including covenants setting forth the duties
of the Authority in relation to the acquisition of property and the con-
struction, improvement, maintenance, repair, operation and issuance of
any project or other property of the Authority, and the rates of fees,
rents and other charges to be charged, and the custody, safeguarding and
application of all moneys of the Authority, and conditions or limitations
with respect to the issuance of additional bonds. It shall be lawful for
any bank or trust company incorporated under the laws of the Common-
wealth which may act as depository of the proceeds of such bonds or of
other revenues of the Authority to furnish indemnifying bonds or to
pledge such securities as may be required by the Authority. Such trust
indenture may set forth the rights and remedies of the bondholders and
of the trustee, and may restrict the individual right of action by bond-
holders.

In addition to the foregoing, such trust indenture or agreement or
resolution may contain such other provisions as the Authority may deem
reasonable and proper for the security of the bondholders. All expenses
incurred in carrying out the provisions of such trust indenture or agree-
ment or resolution may be treated as a part of the cost of a project.

§ 18. The Authority is hereby authorized to fix, revise, charge and
collect fees, rents and other charges for the use of any project and the
facilities thereof. Such fees, rents and other charges shall be so fixed and
adjusted as to provide a fund sufficient with other revenues to pay: first,
the cost of maintaining, repairing and operating the project, and second,
the principal of any interest on such bonds as the same shall become due
and payable and third, to create reserves for such purposes and for other
purposes of the Authority. Such fees, rents and charges shall not be
subject to supervision or regulation by any commission, board, bureau
or agency of the Commonwealth or any such participating political sub-
division. The fees, rents and other charges received by the Authority,
except such part thereof as may be necessary to pay the cost of mainte-
nance, repair and operation and to provide such reserves therefor as may
be provided for in the resolution authorizing the issuance of such bonds
or in the trust indenture or agreement securing the same, shall be set
aside at such regular intervals as may be provided in such resolution or
trust indenture or agreement in a sinking fund which is hereby pledged
to, and charged with, the payment of and the interest on such bonds as
the same shall become due, and the redemption price of the purchase
price of such bonds retired by call or purchase as therein provided. Such
pledge shall be valid and binding from the time when the pledge is made.
The fees, rents and charges so pledged and thereafter received by the
Authority shall immediately be subject to the lien of such pledge without
any physica] delivery thereof or further act, and the lien of any such
pledge shall be valid and binding as against all parties having claims of
any kind in tort, contract or otherwise against the Authority, irrespective
of whether such parties have notice thereof. Neither the resolution nor
any trust indenture by which a pledge is created need be filed or recorded
except in the records of the Authority. The use and disposition of moneys
to credit of such sinking fund shall be subject to the provisions of the
resolution authorizing the issuance of such bonds or of such trust inden-
ture or agreement. Except as may otherwise be provided in such resolu-
tion or such trust indenture or agreement, such sinking fund shall be &
fund for all such bonds without distinction or priority of one over another.

§ 14. All moneys received pursuant to the authority of this act,
whether as proceeds from the sale of bonds or as revenues, shall be
ragenrd to be trust funds to be held and applied solely as provided in

s§ ac

§ 15. Any holder of bonds, notes, certificates or other evidence of
borrowing issued under the provisions of this act or of any of the
coupons appertaining thereto, and the trustee under any trust indenture
or agreement, except to the extent of the rights herein given may be
restricted by such trust indenture or agreement, may, either at law or In
equity, by suit, action, injunction, mandamus or other proceedings, pro-
tect and enforce any and all rights under the laws of the Commonweal
or granted by this act or under such trust indenture or agreement or the
resolution authorizing the issuance of such bonds, notes or certificates,
and may enforce and compel the performance of all duties required by
this act or by such trust indenture or agreement or resolution to be per-
formed by the Authority or by any officer or agent thereof, including the
fixing, charging and collection of fees, rents and other charges.

§ 16. The exercise of the powers granted by this act shall be in all
respects for the benefit of the inhabitants of the Commonwealth, for the
promotion of their safety, health, welfare, convenience and prosperity,
and as the operation and maintenance of any project which the Authority
is authorized to undertake will constitute the performance of an essential
governmental function, no authority shall be required to pay any taxes
or assessments upon any project acquired and constructed by it under
the provisions of this act; and the bonds, notes, certificates or other
evidences of debt issued under the provisions of this act, their transfer
and the income therefrom including any profit made on the sale thereof,
shall at all times be free and exempt from taxation by the Commonwealth
and by any political subdivision thereof.

§ 17. Bonds issued by the Authority under the provisions of this
act are hereby made securities in which all public officers and public
bodies of the Commonwealth and its political subdivisions, all insurance
companies, trust companies, banking associations, investment companies,
executors, administrators, trustees and other fiduciaries may properly
and legally invest funds, including capital in their control or belonging to
them. Such bonds are hereby made securities which may properly and
legally be deposited with and received by any State or municipal officer
or any agency or political subdivision of the Commonwealth for any
purpose for which the deposit of bonds or obligation is now or may here-
after be authorized by law.

§ 18. This act shall constitute full and complete authority, without
regard to the provisions of any other law, for the doing of the acts and
things herein authorized, and shall be liberally construed to effect the
purposes hereof. The provisions of this act are severable, and if any of
its provisions shall be held unconstitutional by any court of competent
jurisdiction, the decision of such court shall not affect or impair any of
the other provisions of this act.