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Signed Into Law
Signed June 20, 2025Effective 2025-09-01
HB5664

Regular Session

Relating to the operation of Wood County Central Hospital District of Wood County, Texas.

Government Affairs & Regulatory Compliance Analysis

HB5664: Government Affairs Overview

HB 5664 mandates the expansion of the Wood County Central Hospital District Board from six to seven members and significantly deregulates the District's financial operations. The legislation removes geographic restrictions on banking partners, repeals the mandatory annual audit requirement in favor of a flexible schedule, and strictly tethers investment strategies to the Public Funds Investment Act.

Rep. Cole Hefner·House Bill·Regular Session

Moderate
Low Cost
Effective:2025-09-01
Enforcing Agencies

Wood County Central Hospital District Board of Directors

Business Impact

Who HB5664 Affects

This legislation has regulatory implications for the following Texas businesses and organizations:

Regulatory Priority: moderate

Notable regulatory updates (effective 2025-09-01). Consider how these changes may affect your operations.

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Banking & Finance

Affected business types:

  • Banks
  • Credit unions
  • Financial services firms
  • Insurance companies
View all banking & finance legislation

Key Operational Considerations

  • 1Board Appointment: The Board must execute a selection process to appoint a temporary seventh director immediately following the effective date.

Estimated Cost Impact

lowMinimal cost impact anticipated.

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HB5664
Relating to the operation of Wood County Central Hospital District of Wood County, Texas.
Moderate Urgency
Heavily Contested
House Vote97 - 34
YEA
NAY
74% in favor131 voting
Senate Vote30 - 1
YEA
97% in favor31 voting
35
Total Opposition Votes
Cost Impact
Low
Effective
2025-09-01
Enforcing Agencies
Wood County Central Hospital Dis...
Primary Author: Rep. Cole Hefner
89th Texas Legislature
jdkey.com
01

Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

  • Effective Date: September 1, 2025
  • Compliance Deadline: September 30, 2025 (Target for appointing temporary director and updating Investment Policy)
  • Agency Rulemaking: No state agency rulemaking required; however, the District Board must pass internal resolutions to formalize the new audit cycle and banking selection criteria immediately post-enactment.

Immediate Action Plan

  • Execute a Board resolution to appoint the temporary seventh director immediately after September 1, 2025.
  • Review all outstanding bond indentures to determine if an annual audit is contractually required despite the statutory relaxation.
  • Issue a new Request for Proposal (RFP) for depository services, soliciting bids from regional and statewide institutions previously ineligible.
  • Update the District’s Investment Policy Statement to explicitly mandate compliance with Government Code Chapter 2256.
  • Notify the D&O insurance carrier of the Board expansion to ensure coverage for the new appointee.

Operational Changes Required

Contracts

  • Depository Agreements: The statutory two-year term limit for bank contracts is repealed; you may now negotiate longer terms (e.g., 3-5 years). Geographic exclusivity is removed, allowing the District to contract with banks located outside Wood County.
  • Audit Engagements: Existing multi-year engagement letters with CPA firms must be reviewed. If the Board moves to a biennial or triennial audit cycle, these contracts require amendment to avoid breach or unnecessary fees.

Hiring/Training

  • Board Appointment: The Board must execute a selection process to appoint a temporary seventh director immediately following the effective date.
  • Financial Compliance: Finance staff must be retrained to ensure all asset allocations strictly comply with Government Code Chapter 2256 (Public Funds Investment Act), as the law removes previous investment discretion.

Reporting & Record-Keeping

  • Investment Policy Statement (IPS): You must update the IPS to explicitly cite Chapter 2256 as the sole authority for investments.
  • Audit Filing: Remove the December 1 deadline for filing the audit with the Comptroller from your compliance calendar; this statutory filing requirement is repealed.

Fees & Costs

  • Audit Savings: Potential reduction in professional service fees if the audit frequency is reduced from annual to triennial.
  • Banking Fees: Potential reduction in banking fees due to the ability to solicit competitive bids from regional or statewide institutions.

Strategic Ambiguities & Considerations

  • Audit Frequency vs. Bond Covenants: While HB 5664 permits a triennial audit, existing bond indentures or credit agreements likely mandate annual audits. Relying solely on this state statute could trigger a technical default on debt obligations. Legal counsel must cross-reference bond documents before altering the audit schedule.
  • Multiple Depositories: The law authorizes the use of "one or more banks" but does not specify allocation protocols. If utilizing multiple banks, the Board must establish clear internal controls for funds distribution to prevent liquidity mismanagement.

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Information presented is for general knowledge only and is provided without warranty, express or implied. Consult qualified government affairs professionals and legal counsel before making compliance decisions.

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Legislative Timeline

This bill's path through the Texas Legislature

Filed
Apr 1, 2025
Passed House
May 16, 2025
Passed Senate
May 28, 2025
Signed
Jun 20, 2025
Effective
Sep 1, 2025
TopicsWood County Central Hospital District of Wood CountySpecial Districts & AuthoritiesSpecial Districts & Authorities--hospitalFinancialFinancial--banks
03

House Authors

Rep. Cole HefnerRepublican · Primary Author

Senate Sponsor

Sen. Bryan HughesRepublican · Primary Sponsor

Bill Text(with markup)

View bill text in multiple formats on Texas Legislature website

Fiscal NoteView Original

Related Legislation

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More from Rep. Cole Hefner

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Related by Topic

View more Wood County Central Hospital District of Wood County legislation
Quick Reference

Frequently Asked Questions

Common questions about HB5664

Q

What does Texas HB5664 do?

HB 5664 mandates the expansion of the Wood County Central Hospital District Board from six to seven members and significantly deregulates the District's financial operations. The legislation removes geographic restrictions on banking partners, repeals the mandatory annual audit requirement in favor of a flexible schedule, and strictly tethers investment strategies to the Public Funds Investment Act.

Q

Who authored HB5664?

HB5664 was authored by Texas Representative Cole Hefner during the Regular Session.

Q

When was HB5664 signed into law?

HB5664 was signed into law by Governor Greg Abbott on June 20, 2025.

Q

Which agencies enforce HB5664?

HB5664 is enforced by Wood County Central Hospital District Board of Directors.

Q

How significant are the changes in HB5664?

The regulatory priority for HB5664 is rated as "moderate". Businesses and organizations should review the legislation to understand potential impacts.

Q

What is the cost impact of HB5664?

The cost impact of HB5664 is estimated as "low". This may vary based on industry and implementation requirements.

Q

What topics does HB5664 address?

HB5664 addresses topics including wood county central hospital district of wood county, special districts & authorities, special districts & authorities--hospital, financial and financial--banks.

Q

What are the key dates for HB5664?

Key dates for HB5664: Effective date is 2025-09-01. Consult with legal counsel regarding applicability.

Need Strategic Guidance on This Legislation?

JD Key Consulting is an Austin, Texas-based government affairs firm led by James Dickey, former Chairman of the Republican Party of Texas. We specialize in Texas regulatory compliance and legislative strategy for data centers, energy, banking, and manufacturing.

Legislative data provided by LegiScanLast updated: January 11, 2026