This Agreement ("Agreement”) is entered into on this 1st day of January, 2013 (the ''Effective Date') , by and between the City of Circleville, Ohio, acting through its Mayor and
City Council (the "City'') and the County of Pickaway, Ohio, acting through its Board of Commissioners (the "County''), pursuant to and under the authority of Ohio R.C. 749.16.
RECITALS
WHEREAS, in 1949, the City and County entered into an agreement (the "Original Agreement'') to maintain, operate, improve and enlarge the then existing municipally owned Berger Hospital (the "Hospital").
WHEREAS, the City and County have each continuously and equally supported the operation of the Hospital since 1949 in substantial accordance with the terms of the Original Agreement; however, there are certain terms of the Original Agreement that no longer apply or that should be modified to reflect the current time and circumstances under which the Hospital, City and County operate and exist.
WHEREAS, the parties now desire to amend and restate the Original Agreement to revise and clarify the obligations of the parties in the operation of the Hospital as of the Effective Date.
STATEMENT OF AGREEMENT
NOW THEREFORE, for and in consideration of the mutual promises and covenants contained herein, the parties agree as follows:
I. Statements of Purpose, Intent and Acknowledgment.
A. The Recitals above are hereby incorporated into and made a part of this Agreement.
B. It is the stated purpose of this Agreement and the intent of the City and the County to continue to support, maintain, operate, improve and enlarge the existing facility and business known as the Hospital. It is further agreed that the Hospital shall at all times be operated and maintained for the general health and welfare of all of the residents of the City and the County and there shall be no differentiation between the rights and privileges of any of such residents.
C. The parties desire to continue operating under but restate the terms of the Original Agreement. It is the belief and intent of the parties that nothing in this Agreement causes or has the effect of causing any change in the ownership or administration of the Hospital. The purpose of this Agreement is to address governance and operations of the Hospital.
D. The Hospital was opened on June 29, 1930 and initially funded by approximately $150,000 from the City, part of which came from the proceeds of a will of Frank P. Berger. Under the Original Agreement, the County agreed to match the City’s funds with $150,000 of funds it generated.
E. Since 1949, the Hospital has been operated and supported jointly and equally by the City and the County, pursuant to the terms of the Original Agreement, which expressly required the parties to share equally in all aspects of the support, operation, maintenance, improvement and enlargement of the Hospital.
F. The Hospital has acquired and disposed of property and assets such that very little of the property or assets that existed in 1949 remain. As such, all of the property and assets used in the operation of the Hospital as of the Effective Date of this Agreement were acquired during the term of the Original Agreement.
G. If it should be necessary for any reason, it is the belief and intent of the parties that the Hospital is jointly and equally owned by both the City and the County.
II. Governance of the Hospital.
Subject to and as allowed under Ohio R.C. Chapter 749, the City and County agree as follows with respect to the Board of Governors of the Hospital:
A. The Hospital Board of Governors shall have nine (9) members consisting of the Mayor of the City, three (3) representatives appointed by the City, at least one of whom shall be a doctor of medicine, three (3) representatives appointed by the County, and two (2) individuals elected as at-large members by the Hospital Board of Governors. The three (3) representatives appointed by the City shall be residents of the City or, as necessary to secure qualified individuals to serve as Board members, may be residents of County or any county adjacent to County. The three (3) representatives appointed by the County shall be residents of County or, as necessary to secure qualified individuals to serve as Board members, may be residents of any county adjacent to County. The individuals elected by the Hospital Board of Governors shall have no residency requirement. At all times, at least a majority of the members of the Board of Governors shall be residents of County. Upon the loss of residency status that would qualify an individual for their appointment, such position shall be considered vacant as of the date of such residency change.
B. The term of office for all members of the Hospital Board of Governors shall be four (4) years with a maximum of three (3) consecutive terms, other than the Mayor of the City of Circleville (whose term shall coincide with his or her term as Mayor). All Board terms shall commence as of January 1. Subject to the transitioning of Board member terms for those members of the Board as of the Effective Date of this Agreement as described on Exhibit A, Board member terms shall be staggered such that each four (4) years, there shall be a cycle for Board member appointments and elections as follows:
"A" Year - Board-elected At-Large # 1, City Appointee # 1
"B" Year- Cow:ity Appointee # 1, City Appointee # 2
"C" Year- County Appointee # 2, Board-elected At-Large # 2
"D" Year (always the same as the year of Mayor elections) - Mayor, County Appointee # 3, City Appointee # 3
C. The City and County agree to follow the process set forth below for appointing members to the Hospital Board of Governors by January 1 of the year for which an appointment is needed. The process shall include the following steps:
1. A form for applying for appointment shall be developed and used by both the City and the County, which form shall be similar in all material respects for both the City and County processes.
2. Beginning July 1 of the year prior to the appointment, advertisements and public notices shall announce the opportunity to apply to be considered for appointment to the Hospital Board of Governors and shall direct interested individuals to a website to download and complete an application. Applications should be due by September 1 of such year.
3. Following a review of the applications to determine those candidates who are qualified and deserving of further consideration, personal interviews of such candidates shall be conducted.
4. The City and the County may each consult with each other, with the President/CEO of the Hospital, and/or with past or present members of the Board of Governors to obtain input on candidates, their qualifications and experience, and the governance needs of Hospital.
5. In the sole discretion of either the City or the County, as applicable, current Board members whose terms expire may be required to re-apply and be considered along with other applicants in order to serve another term.
6. If either the City or County is dissatisfied with the pool of candidates generated, it may develop a supplemental process to identify and consider candidates so long as such process is completed in time for a January 1 appointment.
D. Vacancies for members of the Hospital Board of Governors appointed by the City shall be filled by following the procedure set forth in Ohio R.C. 749.05. Vacancies for members of the Hospital Board of Governors appointed by the County shall be filled by following the procedure set forth in Ohio R.C. 749.18. Vacancies for At-Large members of the Hospital Board of Governors and vacancies not timely filled by the City or the County as provided above shall be filled by the Hospital Board of Governors following the procedures set forth in the Hospital Board of Governors by-laws. The unexpired term of a filled vacancy shall not count against the term limits set forth in Section II(B).
E. Subject to applicable requirements under Ohio law (such as the Ohio Ethics Laws) and the Board of Governors' conflict of interest procedures, all members of the Hospital Board of Governors, including the Mayor, shall be allowed to vote on all matters that come before the Board and shall be eligible to serve on committees of the Board as appointed by the Board through its normal process for making committee appointments.
F. The officers of the Hospital Board of Governors, including the Chair, shall be elected by the Board pursuant to its own process (except that prior to September 9, 2012 and until another Chair is otherwise elected, the Mayor shall serve as the Chair).
III. Operation of Hospital.
A. It is mutually agreed between the City and County that, subject to the limitations set forth in Sections III(B) and III(C):
1. The entire management and control of the Hospital shall be vested with the Hospital's Board of Governors, which shall have exclusive authority over:
a. The maintenance, operation, improvement and enlargement of the Hospital;
b. Control of the real and personal property of the Hospital, including the acquisition, management and disposal of such property;
c. The use of funds used and needed in the operation of the Hospital; and
d. All other functions reasonable and necessary for the operation of the Hospital.
2. The Hospital shall be operated by the Board as a self-sufficient business unit that will not receive ongoing financial support from the City or the County and that will not be required to provide the City or the County with a share of profits or surplus.
3. Absent express written agreement of the City and the County and except as required by law, neither the City nor the County shall be responsible for the obligations, actions or omissions of the Hospital.
4. In the event the Board determines there is a need for financial support from the City and the County, it will make such a request and any support provided shall be jointly provided and equally shared by both the City and County.
B. The following actions require the affirmative vote of at least seven (7) of the nine (9) members of the Hospital Board of Governors present at a properly-called meeting where a quorum is present:
1. Replacement or relocation of the Hospital to a location outside of the city limits of Circleville, unless such location can be annexed or otherwise considered a part of the City through other means (e.g., joint economic development district); or
2. Closure of the facility operated at 600 North Pickaway Street as an inpatient hospital location.
C. There shall be no transaction resulting in the exchange or other disposition of all or substantially all of the assets used in the operation of the Hospital without (1) the affirmative vote of at least seven (7) of the nine (9) members of the Board of the Hospital present at a properly-called meeting where a quorum is present and (2) the further approval of both the City and the County.
D. In the event of the exchange or disposal of all or substantially all of the assets used in the operation of the Hospital as approved pursuant to Section III(C) above, the proceeds of such transaction (if any) shall first be used to satisfy all debts, liabilities and obligations of the Hospital as determined by the Hospital Board of Governors. For any amounts remaining, at least a portion shall be directed to one or more uses for the health and welfare of the residents of Pickaway County as agreed by the City and County at the time of such transaction, with any remaining amounts distributed in equal shares to the City and to the County.
IV. Periodic Review; Communication.
A. During the second calendar quarter of each year beginning in 2013, the City Council and the County Board of Commissioners shall hold a special joint meeting for the purpose of receiving from the Hospital's President and CEO (or his or her designee) a "State of Berger Health System" report. When relevant, such report should include activities of organizations that work closely with or support Hospital, such as Berger Health Foundation, Pickaway Health Services and Pickaway Professional Services.
B. This Agreement shall be reviewed at least once every five (5) years beginning in 2017. In June of such year, unless another date is otherwise agreed by all parties, members of the City Council, County Board of Commissioners and the Board of Governors of Hospital shall meet in person to review the terms and operation of this Agreement. In addition, within sixty (60) days of the written request of either party, one or more representatives of the City Council, County Board of Commissioners and the Board of Governors of Hospital shall meet in person to review the terms and operation of this Agreement. The scope of such review should be limited to those terms necessary to improve the governance and operation of Hospital.
V. General Provisions.
A. This Agreement constitutes the entire understanding between the parties in respect of the subject matter of this Agreement. As of the Effective Date, this Agreement supersedes all prior and contemporaneous understandings or agreements between the parties with respect to the subject matter of this Agreement, including the Original Agreement. This Agreement may be amended only by a written agreement executed by each party affected by such amendment. This Agreement cannot be assigned by a party without the prior written consent of the other party. Each party represents that it has authority to enter into and execute this Agreement. Should any provision or portion of this Agreement be held unenforceable or invalid for any reason, the remaining provisions or portion of this Agreement shall continue in full force and effect. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Ohio with Pickaway County, Ohio being the designated place of venue.
B. In the event of any amendment or enactment of federal, state or local laws, now existing or enacted or promulgated after the effective date of this agreement, that either the Hospital, the City or the County believes affects the terms of this agreement, such party may request that the parties consider an amendment to this agreement to address such change in law.
(Ord. 09-61-12. Passed 9-4-12.)