Delegation says bill would let counties spend proceeds from private-act hospital sales more flexibly

Sen. Jack Johnson and members of Williamson Countys state legislative delegation described legislation March 27 that would change how proceeds from the sale of "private-act" public-benefit hospitals may be used by local governments.

Johnson said existing Tennessee law directs net proceeds from such sales into a trust fund earmarked for community health care, but the bill he described would make the choice permissive for local governments that secure a two-thirds legislative approval. "If you sell your private act public benefit hospital, then and you make money on it, then those proceeds must all go into this... trust fund," Johnson said, describing the current statute and why the change is being proposed.

The senator said the county commission had asked the legislature for greater flexibility: if a sale produced a substantial sum, local leaders might want options beyond dedicating every dollar to the trust fund. Johnson described the proposal as permissive rather than mandatory: it would give counties latitude but would not force a change.

Moderator Dave Crouch said the rumor on the street included interest from large hospital systems; Johnson responded that legislators were not involved in sale conversations and would not comment on specific bidders. "We are not involved in those conversations whatsoever and do not wanna comment on that," he said.

Panelists said they expect the measure to move through the legislative process without major resistance. No formal vote or final action occurred at the forum; the discussion focused on the bill's purpose and the local-government flexibility it would create.

What happens next: panelists said the bill was advancing through the session and expected further floor consideration. Williamson County officials and the county commission would be the decision-makers locally if the law is enacted.