Chapter 231

231.02 231.02 Creation and organization.

231.02(1) (1) There is created a public body politic and corporate to be known as the “Wisconsin Health and Educational Facilities Authority”. The authority shall consist of 7 members nominated by the governor, and with the advice and consent of the senate appointed for staggered 7-year terms. Members shall be residents of the state, and not more than 4 may be members of the same political party. The terms of the members of the authority expire on June 30, one in each succeeding year. Each member’s appointment remains in effect until a successor is appointed. Annually, the governor shall appoint one member as chairperson and the authority shall elect one member as vice chairperson.

231.02(2) (2) The authority shall appoint an executive director and associate executive director who shall not be members of the authority and who shall serve at the pleasure of the authority. They shall receive such compensation as the authority fixes, except that the compensation of the executive director shall not exceed the maximum of the salary range established under s. 20.923 (1) for positions assigned to executive salary group 6 and the compensation of each other employee of the authority shall not exceed the maximum of the salary range established under s. 20.923 (1) for positions assigned to executive salary group 3. The executive director or associate executive director or other person designated by resolution of the authority shall keep a record of the proceedings of the authority and shall be custodian of all books, documents, and papers filed with the authority, the minute book or journal of the authority, and its official seal. The executive director or associate executive director or other person may cause copies to be made of all minutes and other records and documents of the authority and may give certificates under the official seal of the authority to the effect that such copies are true copies, and all persons dealing with the authority may rely upon such certificates.

231.02(3) (3) Four members of the authority shall constitute a quorum. The affirmative vote of a majority of all the members of the authority shall be necessary for any action taken by the authority. A vacancy in the membership of the authority shall not impair the right of a quorum to exercise all the rights and perform all the duties of the authority. Each meeting of the authority shall be open to the public. Notice of meetings, or waivers thereof, shall be as provided in the bylaws of the authority. Resolutions of the authority need not be published or posted. The authority may delegate by resolution to one or more of its members or its executive director such powers and duties as it deems proper.

231.02(5) (5) The members of the authority shall receive no compensation for the performance of their duties as members, but each such member shall be reimbursed for the member’s actual and necessary expenses while engaged in the performance of the member’s duties.

231.02(6) (6) 

231.02(6)(a) (a) Any member, officer, agent or employee of the authority who, directly or indirectly, has any financial interest in any bond issue or in any loan or any property to be included in, or any contract for property or materials to be furnished or used in connection with, any project of the authority, may be fined not less than $50 nor more than $1,000, or imprisoned not more than 30 days or both.

231.02(6)(b) (b) Notwithstanding any other provision of law, it is not a conflict of interest or violation of this section or of any other law for a trustee, director, officer, or employee of a participating health institution, participating educational institution, participating nonprofit institution, or participating research institution or for a person having the required favorable reputation for skill, knowledge, and experience in state and municipal finance or for a person having the required favorable reputation for skill, knowledge, and experience in the field of health facility, educational facility, nonprofit facility, or research facility architecture to serve as a member of the authority; if in each case to which par. (a) is applicable, the trustee, director, officer, or employee of the participating health institution, participating educational institution, participating nonprofit institution, or participating research institution abstains from discussion, deliberation, action, and vote by the authority in specific respect to any undertaking pursuant to this chapter in which his or her participating health institution, participating educational institution, participating nonprofit institution, or participating research institution has an interest, or the person having the required favorable reputation for skill, knowledge, and experience in state and municipal finance abstains from discussion, deliberation, action, and vote by the authority in specific respect to any sale, purchase, or ownership of bonds of the authority in which any business of which such person is a participant, owner, officer, or employee has a past, current, or future interest, or such person having the required favorable reputation for skill, knowledge, and experience in the field of health facility, educational facility, nonprofit facility, or research facility architecture abstains from discussion, deliberation, action, and vote by the authority in specific respect to construction or acquisition of any project of the authority in which any business of which such person is a participant, owner, officer, or employee has a past, current, or future interest.

231.02 History History: 1973 c. 304; 1975 c. 224; 1977 c. 29; 1979 c. 221; 1983 a. 192; 1987 a. 27, 403; 1991 a. 39, 316; 1993 a. 124; 2009 a. 2; 2011 a. 239; 2013 a. 20; 2015 a. 55.

231.03 231.03 Powers. The authority has all the powers necessary or convenient to carry out and effectuate the purposes and provisions of this chapter. In addition to all other powers granted by this chapter, the authority may:

231.03(1) (1) Adopt bylaws and rules for the regulation of its affairs and the conduct of its business.

231.03(2) (2) Adopt an official seal and alter it at pleasure.

231.03(3) (3) Maintain an office.

231.03(4) (4) Sue and be sued in its own name, plead and be impleaded.

231.03(5) (5) Determine the location and character of any project to be financed under this chapter, and construct, reconstruct, remodel, maintain, enlarge, alter, add to, repair, lease as lessee or lessor and regulate the same, enter into contracts for any such purpose, enter into contracts for the management and operation of a project or other health facilities, educational facilities, nonprofit facilities, or research facilities owned by the authority, and designate a participating health institution, participating educational institution, participating nonprofit institution, or participating research institution as its agent to determine the location and character of a project undertaken by the participating health institution, participating educational institution, participating nonprofit institution, or participating research institution under this chapter and as the agent of the authority, to construct, reconstruct, remodel, maintain, manage, enlarge, alter, add to, repair, operate, lease as lessee or lessor and regulate the same, and as the agent of the authority, to enter into contracts for any such purpose, including contracts for the management and operation of such project or other health facilities, educational facilities, nonprofit facilities, or research facilities owned by the authority.

231.03(6) (6) Subject to s. 231.08 (7), issue bonds of the authority to do any of the following:

231.03(6)(a) (a) Finance any project undertaken by a participating health institution if any of the following applies:

231.03(6)(a)1. 1. The department of health services approves the project under subch. II of ch. 150.

231.03(6)(a)2. 2. The department of health services need not approve the project under subch. II of ch. 150 because the cost of the project is equal to or less than the amount in s. 150.21 (3) or (4) and the cost of the project is equal to or greater than 5 percent of the annual operating expenses of the participating health institution.

231.03(6)(a)3. 3. The project is for any of the following purposes:

231.03(6)(a)3.a. a. A capital expenditure, by or on behalf of a hospital, that under generally accepted accounting principles is not properly chargeable as an expense of operations or maintenance, including the cost of studies, surveys, plans and other activities essential to the proposed capital expenditure.

231.03(6)(a)3.b. b. The addition of a service or unit or expansion of an existing service or unit by or on behalf of a hospital.

231.03(6)(a)3.c. c. The expenditure, by or on behalf of a hospital, independent practitioner, partnership, unincorporated medical group or service corporation, as defined in s. 180.1901 (2), or the substantially equivalent laws or rules of another state, for clinical medical equipment.

231.03(6)(a)3.d. d. The acquisition of a hospital.

231.03(6)(a)3.e. e. An addition to a hospital’s bed capacity.

231.03(6)(a)3.f. f. The construction or operation of an ambulatory surgery center or a home health agency.

231.03(6)(a)3.g. g. The acquisition, construction, renovation, improvement or equipping of a health facility described in s. 231.01 (5) (a) 4., including projects begun before August 1, 1987.

231.03(6)(b) (b) Refinance outstanding debt of any participating health institution.

231.03(6)(c) (c) Finance any project undertaken for an educational facility.

231.03(6)(d) (d) Refinance outstanding debt of any participating educational institution.

231.03(6)(g) (g) Finance a purchase, or make a loan, under sub. (20). Bonds issued under this paragraph shall be payable from, or secured by interests in, tobacco settlement revenues and such other property pledged under the bond resolution and, notwithstanding s. 231.08 (3), are not required to mature in 50 years or less from the date of issue.

231.03(6)(h) (h) Finance any project undertaken for a research facility by a participating research institution.

231.03(6)(i) (i) Refinance outstanding debt of any participating research institution.

231.03(6)(j) (j) Finance any project undertaken for a nonprofit facility by a participating nonprofit institution.

231.03(6)(k) (k) Refinance outstanding debt of any participating nonprofit institution.

231.03(7) (7) Fix and revise from time to time and charge and collect rates, rents, fees, and charges for the use of and for the services furnished or to be furnished by a project or other health facilities, educational facilities, nonprofit facilities, or research facilities owned by the authority or any portion thereof, contract with any person in respect thereto and coordinate its policies and procedures, and cooperate with recognized health facility, educational facility, nonprofit facility, or research facility rate setting mechanisms.

231.03(8) (8) Adopt rules for the use of a project or other health facility, educational facility, nonprofit facility, or research facility or any portion of the project or facility owned, financed, or refinanced in whole or in part by the authority, including any property used as security for a loan secured through, from, or with the assistance of the authority. The authority may designate a participating health institution, participating educational institution, participating nonprofit institution, or participating research institution as its agent to establish rules for the use of a project or other health facilities, educational facilities, nonprofit facilities, or research facilities undertaken for that participating health institution, participating educational institution, participating nonprofit institution, or participating research institution. The rules shall ensure that a project, health facility, educational facility, research facility, nonprofit facility, or property may not be used primarily for sectarian instruction or study or as a place for devotional activities or religious worship.

231.03(9) (9) Employ or contract for consulting engineers, architects, attorneys, accountants, construction and financial experts and such other employees and agents as it finds necessary and fix their compensation. Any employee of the authority shall be exempt from subch. II of ch. 230, except s. 230.40 shall apply.

231.03(10) (10) Appoint such technical or professional advisory committees as it finds necessary, define their duties and provide reimbursement of their expenses.

231.03(11) (11) Establish or contract with others to carry out on its behalf a health facility, educational facility, nonprofit facility, or research facility project cost estimating service, and make this service available on all projects to provide expert cost estimates and guidance to the participating health institution, participating educational institution, participating nonprofit institution, or participating research institution and to the authority. To implement this service and, through it, to contribute to cost containment, the authority may require such reasonable reports and documents from health facility, educational facility, nonprofit facility, or research facility projects as are required for this service and for the development of cost reports and guidelines. The authority shall appoint a technical committee on health facility, educational facility, nonprofit facility, or research facility project costs and cost containment.

231.03(12) (12) Receive and accept from any source loans, contributions or grants for or in aid of the construction of a project or any portion thereof in either money, property, labor or other things of value and, when required, use such funds, property or labor only for the purposes for which it was loaned, contributed or granted.

231.03(13) (13) Make loans to any participating health institution, participating educational institution, participating nonprofit institution, or participating research institution for the cost of a project in accordance with an agreement between the authority and the participating health institution, participating educational institution, participating nonprofit institution, or participating research institution. The authority may secure the loan by a mortgage or other security arrangement on the health facility, educational facility, nonprofit facility, or research facility granted by the participating health institution, participating educational institution, participating nonprofit institution, or participating research institution to the authority. The loan may not exceed the total cost of the project as determined by the participating health institution, participating educational institution, participating nonprofit institution, or participating research institution and approved by the authority.

231.03(14) (14) Make loans to a health facility, educational facility, nonprofit facility, or research facility for which bonds may be issued under sub. (6) (b), (d), (i), or (k), to refinance the health facility’s, educational facility’s, nonprofit facility’s, or research facility’s outstanding debt. The authority may secure the loan or bond by a mortgage or other security arrangement on the health facility, educational facility, nonprofit facility, or research facility granted by the participating health institution, participating educational institution, participating nonprofit institution, or participating research institution to the authority.

231.03(15) (15) Mortgage all or any portion of a project and other health facilities, educational facilities, nonprofit facilities, or research facilities and the site thereof, whether owned or thereafter acquired, for the benefit of the holders of bonds issued to finance the project, health facilities, educational facilities, nonprofit facilities, or research facilities or any portion thereof or issued to refund or refinance outstanding indebtedness of participating health institutions, participating educational institutions, participating nonprofit institutions, or participating research institutions as permitted by this chapter.

231.03(16) (16) Lease to a participating health institution, participating educational institution, participating nonprofit institution, or participating research institution the project being financed or other health facilities, educational facilities, nonprofit facilities, or research facilities conveyed to the authority in connection with such financing, upon such terms and conditions as the authority deems proper, and charge and collect rents therefor, and terminate any such lease upon the failure of the lessee to comply with any of the obligations thereof; and include in any such lease, if desired, provisions that the lessee thereof shall have options to renew the term of the lease for such periods and at such rent as the authority determines or to purchase all or any part of the health facilities, educational facilities, nonprofit facilities, or research facilities or that, upon payment of all of the indebtedness incurred by the authority for the financing of such project or health facilities, educational facilities, nonprofit facilities, or research facilities or for refunding outstanding indebtedness of a participating health institution, participating educational institution, participating nonprofit institution, or participating research institution, the authority may convey all or any part of the project or such other health facilities, educational facilities, nonprofit facilities, or research facilities to the lessees thereof with or without consideration.

231.03(17) (17) Charge to and apportion among participating health institutions, participating educational institutions, participating nonprofit institutions, and participating research institutions its administrative costs and expenses incurred in the exercise of the powers and duties conferred by this chapter.

231.03(18) (18) Make studies of needed health facilities, educational facilities, nonprofit facilities, and research facilities that could not sustain a loan were it made under this chapter and recommend remedial action to the legislature; and do the same with regard to any laws or rules that prevent health facilities, educational facilities, nonprofit facilities, and research facilities from benefiting from this chapter.

231.03(19) (19) Obtain, or aid in obtaining, from any department or agency of the United States or of this state or any private company, any insurance or guaranty concerning the payment or repayment of, interest or principal, or both, or any part thereof, on any loan, lease, or obligation or any instrument evidencing or securing the same, made or entered into under the provisions of this chapter; and notwithstanding any other provisions of this chapter, to enter into any agreement, contract, or other instrument with respect to that insurance or guaranty, to accept payment in the manner and form provided therein in the event of default by a participating health institution, participating educational institution, participating nonprofit institution, or participating research institution, and to assign the insurance or guaranty as security for the authority’s bonds.

231.03(20) (20) Purchase the state’s right to receive any of the payments under the tobacco settlement agreement, or make a loan to be secured by the state’s right to receive any of the payments under the tobacco settlement agreement, upon such terms and at such prices as the authority considers reasonable and as can be agreed upon between the authority and the other party to the transaction. The authority may issue certificates or other evidences of ownership interest in tobacco settlement revenues upon such terms and conditions as specified by the authority in the resolution under which the certificates or other evidences are issued or in a related trust agreement or trust indenture.

231.03 History History: 1973 c. 304; 1975 c. 189; 1977 c. 29; 1977 c. 196 s. 131; 1979 c. 221; 1981 c. 20, 298; 1983 a. 27; 1985 a. 29 ss. 2112 to 2115, 3202 (24); 1987 a. 27, 69; 1989 a. 303; 1993 a. 124; 1995 a. 27 s. 9126 (19); 1995 a. 332; 1999 a. 120; 2001 a. 16, 38, 105, 109; 2007 a. 20 s. 9121 (6) (a); 2009 a. 2; 2011 a. 32, 239; 2013 a. 20.

231.03 Annotation This chapter does not violate the establishment of religion clause. The primary effect of ch. 231 does not advance religion, nor does the chapter foster excessive entanglement between church and state. State ex rel. Wisconsin Health Facilities Authority v. Lindner, 91 Wis. 2d 145, 280 N.W.2d 773 (1979).

231.04 231.04 Expenses. All expenses of the authority incurred in carrying out this chapter shall be payable solely from funds provided under the authority of this chapter, and no liability may be incurred by the authority beyond the extent to which moneys have been provided under this chapter except that, for the purposes of meeting the necessary expenses of initial organization and operation of the authority for the period commencing on June 19, 1974 and continuing until such date as the authority derives moneys from funds provided to it under the authority of this chapter, the authority may borrow such moneys as it requires to supplement the funds provided under s. 20.440. Such moneys borrowed by the authority shall subsequently be charged to and apportioned among participating health institutions, participating educational institutions, participating nonprofit institutions, and participating research institutions in an equitable manner, and repaid with appropriate interest over a reasonable period of time.

231.04 History History: 1973 c. 304; 1987 a. 27; 1993 a. 124; 2009 a. 2; 2011 a. 239; 2013 a. 20.

231.05 231.05 Project applications.

231.05(1) (1) By means of this chapter, it is the intent of the legislature to provide assistance and alternative methods of financing to nonprofit entities to aid them in providing needed health services consistent with the state’s health plan, needed educational services, needed research facilities, and other needed services and facilities in this state.

231.05(3) (3) With respect to an applicant requesting financing for health services, the authority shall, at the same time as it notifies the applicant of its action, notify the state health planning and development agency of its action, including data in support of its decision.

231.05(4) (4) Subject to the approval of the authority, an applicant may recommend to the authority an underwriter for the bonds or notes related to its project.

231.05 History History: 1973 c. 304; 1979 c. 221; 1981 c. 20, 298; 1983 a. 27; 1987 a. 27; 1993 a. 124; 2009 a. 2; 2011 a. 239; 2013 a. 20.

231.06 231.06 Property acquisition. The authority may acquire, directly or by and through a participating health institution, participating educational institution, participating nonprofit institution, or participating research institution as its agent, by purchase or by gift or devise, such lands, structures, property, rights, rights-of-way, franchises, easements, and other interests in lands, including lands lying under water and riparian rights, as it deems necessary or convenient for the construction or operation of a project, upon such terms and at such prices as it considers reasonable and can be agreed upon between it and the owner thereof, and take title thereto in the name of the authority or in the name of a health facility, educational facility, nonprofit facility, or research facility as its agent.

231.06 History History: 1973 c. 304; 1977 c. 29; 1987 a. 27; 1993 a. 124; 2009 a. 2; 2011 a. 32, 239; 2013 a. 20.

231.07 231.07 Property conveyance.

231.07(1) (1) If the conditions of sub. (2) are satisfied, the authority shall:

231.07(1)(a) (a) Release the lien of any mortgage, deed of trust or other security arrangement securing the bond; and

231.07(1)(b) (b) Convey to the participating health institution, participating educational institution, participating nonprofit institution, or participating research institution the authority’s interest in the project and in any other health facility, educational facility, nonprofit facility, or research facility leased, mortgaged, or subject to a deed of trust or any other form of security arrangement to secure the bond.

231.07(2) (2) The authority shall release the lien of the security arrangement and convey title under sub. (1) if:

231.07(2)(a) (a) The principal of and interest on any bond issued by the authority to finance a project or to refinance or refund outstanding indebtedness of one or more participating health institutions, participating educational institutions, participating nonprofit institutions, or participating research institutions, including any refunding bonds issued to refund and refinance the bond, have been fully paid and the bonds retired or if the adequate provision has been made to pay fully and retire the bond; and

231.07(2)(b) (b) The conveyance provides that the facility that was financed will not be used primarily for sectarian instruction or study or as a place for devotional activities or religious worship.

231.07 History History: 1973 c. 304; 1977 c. 29; 1979 c. 221; 1987 a. 27; 1993 a. 124; 2009 a. 2; 2011 a. 239; 2013 a. 20.

231.08 231.08 Issuance of bonds.

231.08(1) (1) Subject to sub. (7), the authority may from time to time issue bonds for any corporate purpose. All such bonds or other obligations of the authority issued under this chapter are declared to be negotiable for all purposes, notwithstanding their payment from a limited source and without regard to any other law. The authority shall employ the building commission as its financial consultant to assist and coordinate the issuance of bonds and notes of the authority.

231.08(2) (2) The bonds of each issue shall be payable solely out of revenues of the authority specified in the resolution under which they were issued or in a related trust agreement, trust indenture, indenture of mortgage or deed of trust.

231.08(3) (3) The bonds may be issued as serial bonds or as term bonds, or the authority may issue bonds of both types. The bonds shall be authorized by a bond resolution of the authority and shall bear such dates, mature at such times not exceeding 50 years from their respective dates of issue, bear interest at such rates, be payable at such times, be in such denominations, be in such form, either coupon or fully registered, carry such registration and conversion privileges, be executed in such manner, be payable in lawful money of the United States at such places, and be subject to such terms of redemption as the bond resolution provides. The bonds or notes shall be executed by the manual or facsimile signatures of such officers of the authority as the authority designates. Coupon bonds shall have attached thereto interest coupons bearing the facsimile signature of the treasurer of the authority or such other officer as the authority designates. The bonds or notes may be sold at public or private sale for such price and in such manner and from time to time as the authority determines. Pending preparation of the definitive bonds, the authority may issue interim receipts or certificates which shall be exchanged for the definitive bonds.

231.08(4) (4) Any bond resolution may contain provisions, which shall be a part of the contract with the holders of the bonds to be authorized, as to:

231.08(4)(a) (a) Pledging or assigning the revenues of the project with respect to which the bonds are to be issued or other specified revenues of the authority;

231.08(4)(b) (b) The rentals, fees and other amounts to be charged, and the sums to be raised in each year thereby, and the use, investment and disposition of such sums;

231.08(4)(c) (c) The setting aside of reserves or sinking funds, and the regulation, investment and disposition thereof;

231.08(4)(d) (d) Limitations on the use of the project;

231.08(4)(e) (e) Limitations on the purpose to which or the investments in which the proceeds of sale of any issue of bonds then or thereafter to be issued may be applied;

231.08(4)(f) (f) Limitations on the issuance of additional bonds, the terms upon which additional bonds may be issued and secured and the terms upon which additional bonds may rank on a parity with, or be subordinate or superior to, other bonds;

231.08(4)(g) (g) The refunding of outstanding bonds;

231.08(4)(h) (h) The procedure, if any, by which the terms of any contract with bondholders may be amended or abrogated, the amount of bonds the holders of which must consent thereto and the manner in which such consent may be given;

231.08(4)(i) (i) Defining the acts or omissions to act which shall constitute a default in the duties of the authority to holders of its obligations, and providing the rights and remedies of such holders in the event of a default; and

231.08(4)(j) (j) Any other matters relating to the bonds which the authority deems desirable.

231.08(5) (5) In addition to the other authorizations under this section, bonds of the authority may be secured by a pooling of leases whereby the authority may assign its rights, as lessor, and pledge rents under 2 or more leases of health facilities, educational facilities, nonprofit facilities, or research facilities with 2 or more participating health institutions, participating educational institutions, participating nonprofit institutions, or participating research institutions, as lessees respectively, upon such terms as may be provided for in bond resolutions of the authority.

231.08(6) (6) Neither the members of the authority nor any person executing the bonds are liable personally on the bonds or subject to any personal liability or accountability by reason of the issuance thereof.

231.08(7) (7) Beginning on May 23, 2000, the authority may not issue bonds for the purpose of purchasing a health maintenance organization, as defined in s. 609.01 (2), or any other insurer, as defined in s. 600.03 (27).

231.08(8) (8) The proceeds of a bond issued under this section may be used for a project in this state or any other state, except that if the proceeds of a bond are used for a project located in another state, that project shall include a substantial component located in this state, as determined by the executive director.

231.08 History History: 1973 c. 304; 1977 c. 317; 1987 a. 27; 1993 a. 124; 1999 a. 120; 2009 a. 2; 2011 a. 32, 239; 2013 a. 20.

231.09 231.09 Bond security. The authority may secure any bonds issued under this chapter by a trust agreement, trust indenture, indenture of mortgage or deed of trust by and between the authority and one or more corporate trustees, which may be any trust company or bank in this state having the powers of a trust company. The bond resolution providing for the issuance of bonds so secured shall pledge the revenues to be received by the authority as a result of the terms of the financing referred to in the resolution, and may contain such provisions for protecting and enforcing the rights and remedies of the bondholders as are reasonable and proper and not in violation of law, including particularly such provisions as are specifically authorized by this chapter to be included in any bond resolution of the authority, and may restrict the individual right of action by bondholders. In addition, any bond resolution may contain such other provisions as the authority deems reasonable and proper for the security of the bondholders. All expenses incurred in carrying out the provisions of the bond resolution may be treated as a part of the cost of the operation of a project.