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2001 SESSION
014347768Be it enacted by the General Assembly of Virginia:
1. That § 23-77.4 of the Code of Virginia is amended and reenacted as follows:
§ 23-77.4. Medical center management.
A. The General Assembly recognizes and finds that the economic viability of the
University of Virginia Medical Center, hereafter referred to as the Medical
Center, together with the requirement for its specialized management and
operation, and the need of the Medical Center to participate in cooperative
arrangements reflective of changes in health care delivery, as set forth in §
23-77.3, are dependent upon the ability of the management of the Medical Center to
make and implement promptly decisions necessary to conduct the affairs of the
Medical Center in an efficient, competitive manner. The General Assembly also
recognizes and finds that it is critical to, and in the best interests of, the
Commonwealth that the University continue to fulfill its mission of providing
quality medical and health sciences education and related research and, through
the presence of its Medical Center, continue to provide for the care,
treatment, health-related services, and education activities associated with
Virginia patients, including indigent and medically indigent patients. Because
The General Assembly finds that the ability of the University to fulfill this
mission is highly dependent upon revenues derived from providing health care through its
Medical Center, and because the General Assembly also finds that the ability of
the Medical Center to continue to be a reliable source of such revenues is heavily
dependent upon its ability to compete with other providers of health care which
that are not subject to the requirements of law applicable to agencies of the
Commonwealth. Therefore, the University is hereby authorized to implement the
following modifications to the management and operation of the affairs of the Medical
Center in order to enhance its economic viability.
1. Capital projects. a. For any Medical Center capital project entirely funded
by a nongeneral fund appropriation made by the General Assembly, all
post-appropriation review, approval, administrative, and policy and procedure
functions performed by the Department of General Services, the Division of
Engineering and Buildings, the Department of Planning and Budget and any other
agency that supports the functions performed by these departments are hereby
delegated to the University, subject to the following stipulations and
conditions: (i) the Board of Visitors shall develop and implement an
appropriate system of policies, procedures, reviews and approvals for Medical
Center capital projects to which this subdivision applies; (ii) the system so
adopted shall provide for the review and approval of any Medical Center capital
project to which this subdivision applies in order to ensure that, except as
provided in clause (iii), the cost of any such capital project does not exceed
the sum appropriated therefor and that the project otherwise complies with all
requirements of the Code of Virginia regarding capital projects, excluding only
the post-appropriation review, approval, administrative, and policy and
procedure functions performed by the Department of General Services, the
Division of Engineering and Buildings, the Department of Planning and Budget
and any other agency that supports the functions performed by these
departments; (iii) the Board of Visitors may, during any fiscal year, approve a
transfer of up to a total of fifteen percent of the total nongeneral fund
appropriation for the Medical Center in order to supplement funds appropriated
for a capital project or capital projects of the Medical Center, provided that
the Board of Visitors finds that the transfer is necessary to effectuate the
original intention of the General Assembly in making the appropriation for the
capital project or projects in question; (iv) the University shall report to
the Department of General Services on the status of any such capital project
prior to commencement of construction of, and at the time of acceptance of, any
such capital project; and (v) the University shall ensure that Building
Officials and Code Administrators (BOCA) Code and fire safety inspections of
any such project are conducted and that such projects are inspected by the
State Fire Marshal or his designee prior to certification for building
occupancy by the University's assistant state building official to whom such
inspection responsibility has been delegated pursuant to § 36-98.1. Nothing in
this section shall be deemed to relieve the University of any reporting requirement
pursuant to §§ 2.1-403 and 2.1-404. Notwithstanding the foregoing, the terms
and structure of any financing of any capital project to which this subdivision applies
shall be approved pursuant to § 2.1-179.
b. No capital project to which this subdivision applies shall be materially
increased in size or materially changed in scope beyond the plans and justifications which
were the basis for the project's appropriation unless: (i) (a) the Governor
determines that such increase in size or change in scope is necessary due to an
emergency or (ii) (b) the General Assembly approves the increase or change
in a subsequent appropriation for the project. After construction of any such capital project has commenced, no such increase or change may
be made during construction unless the conditions in (i) (a) or (ii) (b) have
been satisfied.
2. Leases of property.a. The University shall be exempt from the provisions of
§ 2.1-504.2 and from any rules, regulations and guidelines of the Division of Engineering
and Buildings in relation to leases of real property which it enters into on
behalf of the Medical Center and, pursuant to policies and procedures adopted
by the Board of Visitors, may enter into such leases subject to the following
conditions: (i) the lease must be an operating lease and not a capital lease as
defined in guidelines established by the Secretary of Finance and Generally
Accepted Accounting Principles (GAAP); (ii) the University's decision to enter
into such a lease shall be based upon cost, demonstrated need, and compliance
with guidelines adopted by the Board of Visitors which direct that competition
be sought to the maximum practical degree, that all costs of occupancy be
considered, and that the use of the space to be leased actually is necessary
and is efficiently planned; (iii) the form of the lease is approved by the
Special Assistant Attorney General representing the University; (iv) the lease
otherwise meets all requirements of law; (v) the leased property is certified
for occupancy by the building official of the political subdivision in which
the leased property is located; and (vi) upon entering such leases and upon any
subsequent amendment of such leases, the University shall provide copies of all
lease documents and any attachments thereto to the Department of General
Services.
b. Notwithstanding the provisions of §§ 2.1-511 and 23-4.1, but subject to
policies and procedures adopted by the Board of Visitors, the University may lease, for a purpose
consistent with the mission of the Medical Center and for a term not to exceed
fifty years, property in the possession or control of the Medical Center.
c. Notwithstanding the foregoing, the terms and structure of any financing
arrangements secured by capital leases or other similar lease financing agreements shall
be approved pursuant to § 2.1-179.
3. Procurement of goods, services and construction. Contracts awarded by the
University in compliance with this section, on behalf of the Medical Center, for the procurement of
goods, services, including professional services, and construction, shall be
exempt from (i) the Virginia Public Procurement Act (§ 11-35 et seq.), except
as provided below; (ii) Article 3 (§ 2.1-435 et seq.) of Chapter 32 of Title
2.1; and (iii) Article 5 (§ 2.1-480 et seq.) of Chapter 32 of Title 2.1
regarding the review and approval of contracts for the construction of Medical
Center capital projects; however, the provisions of this paragraph may not be
implemented by the University until such time as the Board of Visitors has
adopted guidelines generally applicable to the procurement of goods, services
and construction by the Medical Center or by the University on behalf of the
Medical Center. Such guidelines shall be based upon competitive principles and
shall in each instance seek competition to the maximum practical degree. The
guidelines shall implement a system of competitive negotiation for professional
services; shall prohibit discrimination because of race, religion, color, sex,
or national origin of the bidder or offeror in the solicitation or award of
contracts; may take into account in all cases the dollar amount of the intended
procurement, the term of the anticipated contract, and the likely extent of
competition; may implement a prequalification procedure for contractors or
products; may include provisions for cooperative procurement arrangements with
private health or educational institutions, or with public agencies or
institutions of the several states, territories of the United States or the
District of Columbia; shall incorporate the prompt payment principles of §§
11-62.10 and 11-62.11; and may implement provisions of law. The following sections of the
Virginia Public Procurement Act shall continue to apply to procurements by the Medical
Center or by the University on behalf of the Medical Center: §§ 11-49, 11-51,
11-52 (which section shall not be construed to require compliance with the
prequalification application procedures of subsection B of § 11-46), 11-54,
11-56 through 11-61, and 11-72 through 11-80.
B. Imputed interest earned on the investment of moneys derived from nongeneral operating cash balances, including but not limited to, balances derived from patient care revenues, shall be credited each month to the University of Virginia Medical Center account within the Department of the Treasury by the Comptroller.
[ 2. That to phase in the cost to the Commonwealth of crediting imputed
interest earned on the investment of moneys derived from nongeneral operating cash
balances, including patient care revenues, by the University of Virginia
Medical Center, pursuant to subsection B of § 23-77.4, the University of
Virginia Medical Center shall make the following deposits into the general fund from
interest income earned on such nongeneral operating cash balances, as follows:
$4,400,000 on or before June 30, 2002; $2,200,000 on or before June 30, 2003;
and $1,100,000 on or before June 30, 2004.
C. The University of Virginia Medical Center may use the imputed interest earned on the investment of moneys derived from nongeneral operating cash balances, including but not limited to balances derived from patient care revenues, to match federal Medicaid payments for indigent or low-income patients. ]