Can a Mississippi county board of supervisors shrink, dissolve, or audit the trustees running a county hospital?
Plain-English summary
The Jefferson County hospital was a county-owned community hospital. Its board of trustees had seven members: one from each of the five supervisor districts plus two at-large members. One at-large member's term was about to expire in September 2020. The board of supervisors' attorney asked three questions:
- Could the board of supervisors operate the hospital with six trustees until they could naturally reduce to five?
- Could they dissolve the entire seven-trustee board and start fresh?
- Could they order an internal audit of the county hospital?
The AG's answers were yes, no, and yes:
1. Yes, six is fine. Under Section 41-13-29, community hospital boards must have between five and seven trustees. The mandatory minimum is five. The two at-large positions are optional. When an at-large term expires, the board of supervisors does not have to refill it. Citing the Guice (2012) opinion, the AG concluded the board could let the seventh slot stay empty, run with six trustees, and naturally drift down to five over time as another at-large term expired.
2. No, the board cannot dissolve the existing trustees mid-term. Once trustees are duly appointed for a specific term, they are entitled to serve out the term. The only way to remove a trustee mid-term is for "good cause" under Section 41-13-29(1)(a). The board of supervisors cannot just dissolve and reconstitute the trustee board. The AG cited multiple prior opinions confirming this rule (Guice 2012, Cardin 2005, Guice 2013).
3. Yes, the board can order an audit. Section 19-3-69 lets a board of supervisors contract with certified accountants and other professionals for services "necessary and in the best interest of the county." The AG concluded that authority extends to auditing a county-owned community hospital. The Hagwood (1992) opinion had reached the same conclusion. Beyond that statutory authority, the AG noted other audit-related provisions: pre-sale or pre-lease audits under Section 41-13-15, annual fiscal-year reports the trustees must give the supervisors under Section 41-13-47, and State Auditor audits of community hospitals under Section 27-105-365(3).
Currency note
This opinion was issued in 2020. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.
What the opinion said for each audience, at the time
For county boards of supervisors operating community hospitals
The 2020 framework gave boards of supervisors strong oversight tools but limited reach into the day-to-day governance:
- They could decline to refill at-large trustee vacancies, naturally shrinking the board.
- They could NOT remove trustees mid-term except for "good cause."
- They could order audits at their discretion.
- They could contract with outside professionals to support audits.
So in 2020, a board of supervisors that was unhappy with hospital governance had two main tools: the audit (powerful for transparency) and the gradual replacement (over years, as terms expired and new appointments could be made).
For community hospital trustees
In 2020, trustees had real term protection. Once duly appointed, they were entitled to serve out the term unless removed for good cause. The board of supervisors could not just decide to start over with new trustees because they preferred different people.
The "good cause" standard required:
- A unanimous vote of all members of the appointing entity, OR
- A majority vote after a recommendation from the trustee board itself
- Some defined cause (misconduct, neglect, incapacity, ineligibility) supportable as cause
That insulation served continuity and political independence in hospital governance.
For hospital administrators and CFOs
Hospital administrators in 2020 had to plan around at least two distinct external oversight loops:
- The annual fiscal-year report to the owner (board of supervisors), required by Section 41-13-47, due by the first Monday in March.
- Audits ordered ad hoc by the board of supervisors under Section 19-3-69, conducted by outside firms.
- Periodic State Auditor audits under Section 27-105-365(3), aligned with the county's regular audit cycle.
A pre-sale or pre-lease audit was required under Section 41-13-15 if the owner was contemplating a sale or lease of the hospital.
For county attorneys advising in 2020
When the board of supervisors wanted to make changes at a county hospital, the legally clean paths were:
- Audit the hospital (Section 19-3-69)
- Decline to refill expiring at-large trustee positions (Section 41-13-29(1))
- Remove a specific trustee for good cause with the required vote (Section 41-13-29(1)(a))
- Wait out trustee terms and make new appointments
The legally unsupported path was a unilateral dissolution and re-appointment. That was off the table absent statutory amendment.
For state auditor personnel
The State Auditor's authority under Section 27-105-365(3) was confirmed in the opinion: community hospitals are audited at the same time and in the same manner as the county itself. That coexists with the county's own audit authority and the trustees' annual report obligation.
Common questions
Q: How was a community hospital trustee removed for "good cause" in 2020?
A: Under Section 41-13-29(1)(a), removal required:
1. A unanimous vote of all members of the appointing governing board, OR
2. A majority vote after a recommendation from the hospital's own board of trustees that the trustee be removed.
Plus actual cause (misconduct, neglect, incapacity, etc.). The AG opinion did not enumerate good causes; that was fact-specific.
Q: What was the rationale for the term protection?
A: Continuity and independence. Hospital governance benefits from trustees who can take long-term views without fearing political pressure. The legislature's choice in 2020 to require either unanimity or trustee-board-recommendation made removal difficult except in clear cases.
Q: What was the practical effect of letting the trustee board operate with six members?
A: A six-member board faced potential tie votes. The AG opinion did not address tie-breaking. In practice, hospital boards often had operational rules for tie votes, or relied on majority-of-quorum approaches. Eventually, as another at-large term expired, the board would shrink to five.
Q: Could the board of supervisors order an audit if the trustees objected?
A: Yes. Section 19-3-69 was the supervisors' independent authority to contract for accounting and professional services in the county's interest. Trustee objection did not block the audit.
Q: What did the audit cover?
A: That depended on the audit's scope, which was set by the contracting board. Typical scopes included financial controls, expenditures, billing practices, compliance with hospital policies, and management practices. The audit was not a substitute for the State Auditor's regular audits, but a supplement.
Q: Could the audit lead to trustee removal?
A: Indirectly, yes. Audit findings of misconduct or neglect could form the "good cause" basis for trustee removal under Section 41-13-29(1)(a). But the audit by itself did not remove anyone; the board of supervisors still had to follow the removal procedure.
Q: Was the board of supervisors's discretion to NOT refill at-large positions absolute?
A: Effectively yes, in 2020. Section 41-13-29 allowed boards of "not less than five" trustees, so the supervisors could shrink to five. But the supervisors could not shrink below five; that minimum was mandatory.
Q: How did this interact with hospital sales or leases?
A: Section 41-13-15 governed sales and leases of community hospitals. A pre-sale or pre-lease audit was required. The 2020 AG opinion noted this but did not analyze the sale-or-lease decision itself.
Background and statutory framework
The community hospital framework in Mississippi (Section 41-13-1 et seq.) is a structure for county-owned hospitals that operate as semi-independent entities under boards of trustees. The statute balances ownership-by-county with operational-independence-by-trustees.
Key features as they stood in 2020:
Section 41-13-29 governed the trustee board:
- Five to seven members
- Appointed by the owner (county or municipality)
- Pro rata to ownership interests
- Trustees must be residents of the owning entity
- Initial terms staggered (one each at one, two, three, four, five years) to ensure continuity
- Subsequent terms five years each
- Removal for good cause, by unanimity or with trustee recommendation
Section 41-13-47 required the trustee board to file an annual fiscal-year report with the owner by the first Monday in March.
Section 19-3-69 gave the board of supervisors broad authority to contract with accountants and other professionals.
Section 27-105-365(3) gave the State Auditor authority to audit community hospitals at the same time as the county.
Section 41-13-15 required a pre-sale or pre-lease audit by a CPA firm, law firm, or health care management consultant.
The Guice opinions cited (Jan. 3, 2012; Jan. 17, 2012; Apr. 26, 2013) had developed the framework over years. The Cardin opinion (Aug. 26, 2005) had affirmed the term-protection rule. The Hagwood opinion (Dec. 16, 1992) had affirmed the audit authority. The 2020 Banks opinion is in line with this established body of guidance.
The opinion does not address one important real-world question: what if the trustee board itself is dysfunctional and the supervisors want change? The answer, as it stood in 2020, was: use the audit, use the term-expiration cycle, and use the good-cause removal procedure. Patience and process, not unilateral dissolution.
Citations and references
Statutes (as in effect at the time of the opinion):
- Miss. Code Ann. § 19-3-69, county board authority to contract for accounting and professional services
- Miss. Code Ann. § 27-105-365(3), State Auditor audit of community hospitals
- Miss. Code Ann. § 41-13-1 et seq., community hospital framework
- Miss. Code Ann. § 41-13-15, pre-sale or pre-lease audit requirement
- Miss. Code Ann. § 41-13-29, board of trustees composition and removal
- Miss. Code Ann. § 41-13-29(1)(a), removal for good cause
- Miss. Code Ann. § 41-13-29(1), authority to appoint trustees
- Miss. Code Ann. § 41-13-47, annual fiscal-year report by trustees
Prior AG opinions:
- MS AG Op., Guice (Jan. 3, 2012), trustees over five entitled to serve out terms
- MS AG Op., Guice (Jan. 17, 2012), board of supervisors cannot revoke appointments mid-term
- MS AG Op., Guice (Apr. 26, 2013), trustees entitled to entire term unless removed for good cause
- MS AG Op., Cardin (Aug. 26, 2005), term protection for appointees
- MS AG Op., Hagwood (Dec. 16, 1992), board of supervisors may contract for hospital audit
- MS AG Op., Reed (Mar. 3, 2017), State Auditor authority confirmed
Source
- Landing page: https://attorneygenerallynnfitch.com/divisions/opinions-and-policy/recent-opinions/
- Original PDF: https://attorneygenerallynnfitch.com/wp-content/uploads/2021/07/N.Banks_September-29-2020-Board-of-Trustees-of-County-Hospital.pdf
Original opinion text
September 29, 2020
Nickita S. Banks, Esq.
Board Attorney, Jefferson County Board of Supervisors
Post Office Box 124
Port Gibson, Mississippi 39150
Re: Board of Trustees of County Hospital
Dear Ms. Banks:
The Office of the Attorney General has received your request for an official opinion.
Background
You state that the county-owned hospital's board of trustees is currently composed of seven (7) trustees, one (1) from each supervisor district and two (2) at-large members. One of the at-large member's term expires in September 2020.
Questions Presented
- Does the board of supervisors have authority to require the board of trustees to function with only six (6) members, until such time as they can reduce the board of trustees to five members?
- Does the board of supervisors have authority to dissolve the hospital board of trustees and reappoint an entirely new board of trustees?
- Does the board of supervisors have authority to order an internal audit of the county hospital?
Brief Responses
In response to your first question, yes. A community hospital board of trustees must be composed of at least five, but not more than seven, members. When the term of office for an at-large trustee serving over and above the mandatory five (5) trustees expires, the Board of Supervisors is not obligated to appoint or re-appoint a trustee to continue in that position. Therefore, the board of supervisors may allow a six (6) member board of trustees to govern the hospital until such time as the board of trustees can be reduced to five (5) members.
In response to your second question, no. The duly appointed trustees currently serving are entitled to serve the entire term for which they were appointed, unless removed for good cause in accordance with Section 41-13-29(1)(a) of the Mississippi Code. Therefore, the board of supervisors does not have authority to dissolve the current board of trustees and appoint an entirely new board.
In response to your third question, yes. A county board of supervisors is expressly authorized to contract with certified accountants and other professionals for services determined to be "necessary and in the best interest of the county." It is the opinion of this office that such authority extends to auditing a community hospital owned by the county and governed by a board of trustees.
Applicable Law and Discussion
Mississippi law sets forth the duties and authority belonging to a board of supervisors and community hospital board of trustees, with respect to the ownership and operation of community hospitals, providing, in pertinent part:
(1)(a) The owners are authorized to appoint trustees for the purpose of operating and governing community hospitals. The owner of a community hospital may remove a trustee after appointment for good cause shown, upon a unanimous vote of all members of the governing board of the owner that appointed the trustee, or upon a majority vote of the governing board of the owner that appointed the trustee after a recommendation from the board of trustees of the hospital that the trustee be removed. To be eligible for appointment, an appointee must be an adult legal resident of the county which has an ownership interest in the community hospital or the county in which the municipality or other political subdivision holding the ownership interest in the community hospital is located. The authority to appoint trustees shall not apply to leased facilities, unless specifically reserved by the owner in the applicable lease agreement.
(b) The board of trustees shall consist of not more than seven (7) members nor less than five (5) members, except where specifically authorized by statute, and shall be appointed by the respective owners on a pro rata basis comparable to the ownership interests in the community hospital. Where the community hospital is owned solely by a county, or any supervisors districts, judicial districts or election district of a county, or by a municipality, the trustees shall be residents of the owning entity.
...
(2)(a) Initially the board of trustees shall be appointed as follows: one (1) for a term of one (1) year, one (1) for a term of two (2) years, one (1) for a term of three (3) years, one (1) for a term of four (4) years, and one (1) for a term of five (5) years. Appointments exceeding five (5) in number shall be for terms of four (4) and five (5) years, respectively. Thereafter, all terms shall be for five (5) years.
Miss. Code Ann. § 41-13-29 (emphasis added).
With respect to your first question, this office has had the occasion to opine with respect to boards of trustees comprised of more than five members:
Duly appointed trustees of a community hospital over and above the mandatory five (5) trustees are entitled to serve the remainder of their current terms of office without being subject to removal. Upon the expiration of their current terms, the board of supervisors has the discretionary authority to continue to appoint or re-appoint the additional trustees authorized by Section 41-13-29(1). If, upon the expiration of the current terms of the additional trustees, the board of supervisors wishes to have a five (5) member board of trustees, said board could simply decline to make any appointments that are in excess of the mandatory five (5).
MS AG Op., Guice at *1 (Jan. 3, 2012). When the term of office for an at-large trustee serving over and above the mandatory five (5) trustees expires, the board of supervisors is not obligated to appoint or re-appoint a trustee to continue in that position. Therefore, the board of supervisors may allow a six (6) member board of trustees to govern the hospital until such time as the board of trustees can be reduced to five (5) members.
With respect to your second question, this office has also previously addressed the issue of removing a community hospital trustee:
Once appointed to an office for a specific term, an appointee is entitled to serve the entire term without being subject to removal, as long as he remains qualified to hold office. MS AG Op., Guice (January 3, 2012) (citing MS AG Op., Cardin (August 26, 2005)). We have also opined that the board of supervisors cannot revoke its appointment of or otherwise terminate a member of the board of trustees prior to expiration of his/her term except for statutorily permitted reasons. MS AG Op., Guice (January 17, 2012).
MS AG Op., Guice at *2 (Apr. 26, 2013). Consistent with the Guice opinions cited herein, because the duly appointed trustees are entitled to serve the entire term for which they were appointed, unless removed for good cause in accordance with Mississippi Code Annotated Section 41-13-29(1)(a), the board of supervisors does not have authority to dissolve the current board of trustees and appoint an entirely new board.
Turning to your third question, Section 19-3-69 expressly authorizes a county board of supervisors to contract with certified accountants and other professionals for services determined to be "necessary and in the best interest of the county." Citing this code section, this office has previously opined that a board of supervisors may, "in the exercise of their discretion, employ or contract with an independent certified public accounting firm to assist in the audit of . . . a public community hospital which is in part owned and funded by [the county] pursuant to Sections 41-13-1 et seq., Miss. Code of 1972 . . . ." MS AG Op., Hagwood at *1 (Dec. 16, 1992). Accordingly, pursuant to Section 19-3-69, we are of the opinion that a board of supervisors does have authority to order an internal audit of a community hospital owned by the county.
We would also note that a board of supervisors may order an audit in conjunction with the sale or lease of a community hospital. Miss. Code Ann. § 41-13-15 ("Whenever any owner decides that it may be in its best interests to sell or lease a community hospital as provided for under subsection (7) of this section, the owner shall first contract with a certified public accounting firm, a law firm or competent professional health care or management consultants to review the current operating condition of the community hospital."). Moreover, a board of supervisors, on an annual basis, should receive an audit report from the community hospital board of trustees. Miss. Code Ann. § 41-13-47 ("On or before the first Monday in March of each year, said board of trustees shall also make, enter on its minutes and file with such owner or owners, a full fiscal year report which shall contain a complete and correct accounting of all funds received and expended for all hospital purposes."). Finally, the State Auditor is also charged with auditing the books and records of each community hospital "at the same time and in the same manner as the accounts and financial records of the county are audited . . . ." Miss. Code Ann. § 27-105-365(3); see also MS AG Op., Reed at *3 (Mar. 3, 2017).
If we may be of any further assistance to you, please do not hesitate to contact us.
Sincerely,
LYNN FITCH, ATTORNEY GENERAL
By: /s/ Phil Carter
Phil Carter
Special Assistant Attorney General