STATE OF SOUTH DAKOTA
OFFICE OF
THE ATTORNEY GENERAL

April 29, 1974

Bradley G. Bonynge
States Attorney, Jerauld County
Wessington Springs, South Dakota 57382

OFFICIAL OPINION NO. 74-15

County medical clinic must be authorized by vote of residents of County.

Dear Mr.Bonynge:

You have asked for an opinion based on the following factual situation:

Jerauld County, South Dakota has for some time owned and operated a county hospital pursuant to the provisions of Ch. 34-8, SDCL 1967, as amended. The hospital is a facility within the ordinary intendment of that term providing for in-patients and certain out-patient treatment. There is no medical clinic being operated in connection with the present hospital facility which term is defined as a building and its equipment in which a physician in the private practice of medicine would ordinarily practice and treat out-patients. Since 1007 the hospital has been operated under a leasing arrangement from the county by Lutheran Hospital and Homes Society pursuant to the provisions of 34-8-10, SDC'L 1967. There is presently in the county treasury the sum of $78,921.35 which was attributable to income from the operation of the hospital prior to the time operations were turned over to the Lutheran Hospital and Home Society. This money is presently in a fund labeled, "Hospital Depreciation Fund." In addition, there is in the county treasury at this time the sum of $106,688.36 labeled as a "Hospital Maintenance Fund." This money, which accumulated largely from a county levy of operation and maintenance of the hospital provided by 34-8-19, SDCL 1967. Also, this fund contains an amount which is presently unascertained at this time resulting from operation income from the hospital similar to those sums in the hospital depreciation fund. The amount in the hospital depreciation fund and the amount in the hospital maintenance fund, other than that procured by tax levies, would seem to be considered part of the county hospital fund referred to in 34-8-20 SDCL.

In connection with the following factual situation, you have asked the following questions:

1. Can the county commission authorize by simple resolution of its members the establishment of a medical clinic? If not, what are the formalities and procedures through which the county commission must go to establish the medical clinic?

SDCL 34-8-1 defines "hospital" as being a hospital, a medical facility and its equipment, a nursing home or a home for the aged. It is my opinion that SDCL 34-8-1 as it presently reads includes a medical clinic within the purview of a medical facility."

SDCL 34-8-4 requires the county commissioners to submit the question of establishing and maintaining a county hospital or of issuing bonds for such purpose to the electors of the county at any regular election or at a special election called for that purpose. It is my opinion that the medical clinic you propose to build would need to be approved by the voters as required by this statute.

SDCL 34-8-4.1 does not apply in this situation since here we are dealing with a new separate facility, not merely an addition to an existing facility. It is my opinitn that each new separate type of facility will require approval of the voters, as required in SDCL 34-8-4. A contrary result, here would, in my opinion, subvert the clear intention of the Legislature as expressed in SDCL 34-8-4. See also 1959-60 AGR 226, 1961-62 AGR 103. This, I believe, answers your first question.

2. Assuming a cilinc can be established by some legal means set forth in anwer to the preceding question, is the county allowed by simple resolution of the commissioners to fund the purchase, construction and equipping of this medical clinic with the money available in the above specified funds by simple resolution of the county commissioners? If not, what procedures, if any, must the commission take to so expend such funds?

Assuming the fund you describe as attributable to the income of the hospital, would come under SDCL 34-8-20, it seems clear that the county commissioners could appropriate that money directly to fund construction of a new hospital or medical clinic facility.

With respect to the $160,688.36 hospital maintenance fund you describe as accumulated from a county levy authorized by SDCL 34-8-19, SDCL 7-21-49 would permit the unexpended balance of this special fund to be transferred if the purposes for which it was created have been served, all claims against the fund have been paid, and there remains no further use for the balance of the fund for the purpose for which it was created. That factual determination, however, is not one that this office can legitimately make. Transfer of these funds might be made to a sinking fund as authorized by SDCL 34-8-5. However, before any of this money could be transferred and used for construction of a medical clinic, SDCL 7-21-49 would need to be complied with.

3. Can the county commissioners, by simple vote of the board, appropriate money from other funds including revenue sharing funds, assuming it is permitted by the Federal Government and other moneys for the purpose of bulding and equipping the medical clinic by simple majority vote? If not, what legal procedures must be followed for such funding, if any?

I am not aware of any provision of South Dakota law which would require more than a majority of the county commission to pass on an appropriation measure. Any revenue sharing funds which the county is given would be appropriated according to the same procedural rule as non-revenue sharing funds.

4. Could the county commissioners, by the authority given in SDCL 34-8A-l by unanimous vote donate money from the above described ,hospital funds or other sources of revenue such as revenue sharing, assuming this is permissible to the Federal Government, to a private individual or organization for the purpose of purchasing, building and equipping a medical clinic which would be the property of such private individual or organization provided the commission deemed it necessary to ensure the availability of professional medical services?

Assuming the county commission has funds legally available to them, the answer to your question is YES, they can.

Respectfully submitted,

Kermit A. Sande
Attorney General