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Pursuant to the authority of the transferred or ceases to be used for a ay under any of the following permissible use as described in $124.704. The Pablic Works Acceleration $ 124.703 Federal right of recovery.

1982, Pub. L. 87-658 (42 U.S.C. (a) If any facility is at any time with1.);

in 20 years after the completion of the The District of Columbia Medical

grant-assisted construction or modTides Construction Act of 1968, 82 ernization sold or transferred to any 01 (Pub. L. 90 457);

entity which is either not qualified for The Appalachian Regional Devel- a grant under the statute pursuant to et Act of 1965, as amended (40 which the grant was awarded or not ap L. App.).

proved as a transferee by the State

agency, the United States shall be entiIT Definitions.

tled to recover on the basis of joint and sed in this subpart

several liability from any transferor, means the Public Health Service transferee, or successive transferee of

the facility an amount determined in partment means the Department of accordance with this subpart. it and Human Services.

(b) If any facility at any time within pected useful life means the period 20 years after the completion of the time during which the structure grant-assisted construction or mod

reasonably be expected to perform ernization ceases to be public or function for which it was designed other non-profit facility that would atended.

have been eligible for a grant under the facility means a facility with respect statute pursuant to which the grant which grant funds were paid under was awarded, the United States shall

of the authorizations listed in be entitled to recover from the owners 1701.

of the facility an amount determined * S Pacal year means the facility's fiscal in accordance with this subpart. 9 Improfit, as applied to any facility, § 124.704 Notification of sale, transfer,

& facility that is owned and op- or change of use. sed by one or more nonprofit cor- (a) The transferor of a facility that is stions or associations no part of the sold or transferred as described in

earnings of which inures, or may $124.703(a), or the owner of a facility It mully inure, to the benefit of any which ceases to be a public or other 21 mate shareholder or individual.

nonprofit facility as described in Sikeretary means the Secretary of $124.703(b), shall provide the Secretary as alth and Human Services and any written notice of such sale, transfer, or The officer or employee of the De- other change not later than 10 days 200ment of Health and Human Serv- after the date on which the sale, trans

na to whom the authority involved fer, or change occurs.
las been delegated.

(1) "Transfer." For purposes of this
state agency means (1) in the case of subpart, a transfer occurs when a facil-
a facility with respect to which a grant ity is conveyed to another entity
u made under title VI of the Public through lease, merger, bankruptcy,
Pealth Service Act or any of the stat- foreclosure, or other arrangement.
stes listed in $124.701(b), the State (2) “Cease to be." For purposes of this
gency designated pursuant to section subpart,
in of the Public Health Service Act or (i) A facility “ceases to be" a facility
its successor agency, and (2) in the case for which a grant could have been made
d a facility with respect to which a under the statute pursuant to which
print was made under title XVI of the the grant was awarded when it is no

Public Health Service Act, the State longer operated as such a facility; and lect #health planning and development agen- (ii) A facility "ceases to be a public constants T designated pursuant to title XV of or nonprofit facility" when an entity the Public Health Service Act.

that is not a public or other non-profit Then value means the value of the fa- corporation or association assumes cility on the date the facility is sold, management responsibilities with re

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114.705 Amount of recovery.

(a) Except as provided in 5124.7 onnt that the United States si utled to recover under this 8 s that amount bearing the same 2 she then valde of so much of 1 SJ 28 constituted an api ject (or projects) as the amo

en participation bore to th The construction or moderni: te such project (or projects).

The then value of the facilit

de transaction value in the 122 ums-length sale or transfer,

depreciated reproduction
e sisence of an arms-length

Use or if the buyer fails to
360 days after the da
De Serrury's letter describe
$24: the information which
Dement of the Secretary, is
sa establish, adjust, and aj
3section value. As use

"transaction
os e case of a sale, the
Imi the case of a lease,
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ee the reproduct

fagropriate, an alterna

Yomon value will be 2382 2 BW for the purchase

o sets and the assun 12 * jana associated with i Daun. determine the amot u i sve, she adjusted vel

spparaad to the grant-aid NS de son of the remain Xe sia of those assets 21.maining useful 111

ats not previous Presa de 3 pitasting the tran

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Negua Rwah the grant s nusu de all then be IR YN SIT & the remaining

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suus she recovery us De Fill include 28 R Xem NTDS assist

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roeived by the facility under an (1) Has filed a written request for the city listed in $ 124.701 and any as- waiver within the time limits pre

supplementary to that assist scribed by this section; received for the construction or (2) Has established an irrevocable ndation of the facility under the trust in accordance with this section,

Works and Economic Develop in an amou equal to the greater of Act of 1965 (42 U.S.C. 3121, et seq.) the amount that would otherwise have Local Public Works Capital De been recovered pursuant to $124.705 (insent Act of 1976 (Pub. L. 94-369). cluding accrued interest as calculated

under $ 124.706) or twice the cost of the Calculation of interest.

remaining uncompensated services ob1 addition to the amount of re- ligation of the facility as of the date of

calculated under $124.705, the the change of status, that will be used States shall be entitled to re- by the entity only to provide services interest on such amount in ac- to those unable to pay in accordance sce with this section at the rate with the requirements of subpart F of mined by the Secretary based on this part; and verage of the bond equivalent of (3) Has agreed to comply with the ekly ninety-day U.S. Treasury community service regulations set out action rate for the quarter pre- in subpart G of this part. to the quarter in which interest (b) Procedures for obtaining waiver. (1)

to accrue under this section. Within 30 days after the date of receipt Change of status before July 18, of the information described in For facilities that were sold or $124.704(b), the Secretary will send a ferred or which ceased to be pub- letter to the new owner of the facility

other nonprofit facilities before advising of the United States' right of 18, 1984, interest will be charged recovery and the opportunity to obtain ming August 17, 1984, or 180 da. a waiver. For the purpose of advising the date of such sale, transfer or the new owner of the amount to be whichever is later, and ending placed in the irrevocable trust should

date the amount the United the owner wish to obtain a waiver, the is entitled to recover is col- letter will also state the dollar amount

of the remaining uncompensated care Change of status after July 17, 1984. obligation and the amount that would facilities that are sold or trans- be due under $124.706, computed as fol

or which cease to be public or lows: nonprofit facilities after July 17, (1) Computation of uncompensated care

interest will be charged beginning obligation. (A) For a facility which lays after receipt by the Depart changes status before the date that

of the notice required under subpart F of this part is effective for L104; Provided, That if such notice is the facility, the remaining uncompenprovided as prescribed, interest sated services obligation is zero. I be charged beginning on the date (B) For a facility which changes stathe sale, transfer, or change of use, tus after the date that subpart F of

ending on the date the amount this part is effective for the facility, dich the United States is entitled to the Secretary will multiply the annual utover is collected.

compliance level, computed under the 6) The Secretary may waive interest 10% method specified in 42 CFR darges that result from delays caused 124.503(a)(1)(ii), for the fiscal year in klely by the Department.

which the change of status occurs

times the number of years remaining 1124.707 Waiver of recovery where fa- in the facility's uncompensated serv

cility is sold or transferred to a pro ices obligation. From this amount, the prietary entity.

Secretary will subtract amounts of ex(2) Conditions of the waiver. The Sec- cess or add amounts of deficit for each retary may waive the recovery rights fiscal year prior to the change of status of the United States arising under for which the Secretary has previously 1124.703(a) If the entity to which the fa- conducted an audit of uncompensated cility was sold or transferred:

services accounts. Excess and deficits will be adjusted by the percent change be the remainder of the expecte: in the National Consumer Price Index life of the facility, as follows: for Medical Care between the year in for buildings, 30 years for addito which the excess or deficit occurred years for building renovations, and the year in which the status for fixed equipment and 12 y change occurred. For each fiscal year major movable equipment. prior to the change of status which the (11) Computation of recovery Secretary has not audited, the Sec- The Secretary will determine retary will add to the remaining obli

covery amount as provided in 1 gation an amount equal to the annual

(2) Within 60 days following t oompliance level in each such year ad

of the Secretary's letter provide justed by the percent change in the Na- suant to paragraph (b)(1) of te tional Consumer Price Index for Medical Care between that year and the

tion, the owner of the facility se

tify the Secretary in writing the year of the status change. The amount ther: computed as the total remaining obli

(1) Accepts the trust fund amca gation will then be multiplied by two. If the transferee chooses to accept the

the waiver as offered by the Ser: 1 Secretary's calculation, no further as

(ii) Provides a detailed stater sessments will be made of uncompen

an alternative determination of saced care provided prior to the change

covery amount or an independer of status date. If the transferee does

of the remaining uncompensate not accept the calculation, the trans

ices obligation as described ir*** reror or transferee may hire, and may

graph (bX1X1) of this section; or 5 charge against the irrevocable trust es

(iii) Does not seek a waiver stb tablished under this section, an inde

$ 124.707. Failure to provide a time pendent auditor to certify the compli- sponse to the Secretary under th® Tit ance level and any excess or deficit for

paragraph will be considered as 3 the period thom Vay 18. 1979, up to and

tion not to seek the waiver. including the date of the change of sta

(3) Within 30 days following t*00tus, using standard Departmental pro- ceipt of the owner's views conot tbt cedures supplemented with instrue- the calculation, and after consist tions provided by the Secretary, and those rews, the Secretary will * of submit the results in accordance with final letter providing the Secre pargrup 022) of this section the determination of twice the remade 208 ***V de condueted for any years uzcompensated care obligation at not included in a previous sie as recovery amount under $124.705 2u en met onzesed by the Department. I sent to be piaced in the irreve Paredi ne Saretary trees sange is

trist v be the higher of thost appropriate, the Secretary w: use this Erres. See parsgraph (aX2) of provi 12 oration to the deladica section) *** out in pars :73

Within 30 days of the date o on. I the execuenter cer 18. etter, the owner of the far com *** 25 are w38 vedered sai joate the Secretary in w Me co

her de 2 or is episce whecer or act i secects she teni mella persede she ws:ver. Fire to provide teosta o ere becwrea de ce e vazge vecice to the Secretary nder this may $63 uue 212 313 neos of pass. v. de ceos dered an che srud, 10 Sery yes the w0D 10G 2 secept she was ver. pues ser levei 29 206 1 Stadt Stent of the 1723. (1) tecche een of de cette sem W 1878 he iada y :3 scceptr " this se Incempena 0 29 Noi:- fi va ter under push fox

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The owner shall provide a copy of States arising under $124.703(b). In de38. documents to the Secretary termining whether there is good cause so trust shall be considered estab- under this section for releasing the ap

antil the trust documents have plicant or other owner of the facility approved by the Secretary; and from its obligation, the Secretary will a The owner may credit against the take into consideration the extent to

any uncompensated services pro- which: in accordance with subpart F of (a) The facility will be devoted by the

part between the date of the applicant or other owner to use for anAs of status of the facility and the other public or nonprofit purpose whch sunishment of the trust. For an will promote the purpose of the Act;

to receive the credit before the (b) There are reasonable assurances mishment of the trust and deposit that for the remainder of the 20-year tots therein, the auditor's report period other public or nonprofit facilizing the post-transfer period shall ties not previously utilized for the purchmitted with the notification of pose for which the facility was congrance of the waiver, and in any structed will be so utilized and are sub

zot later than 30 days from the stantially equivalent in nature and of the Secretary's final letter de- purpose. ed in paragraph (b)(3) of this sec- (c) The facility has been acquired Within 30 days followi-3 the re- from an agency of the United States of the auditor's report, the Sec- (e.g., the Federal Housing Administrasy will notify the owner of the al- tion under its mortgage Insurance comthe credit, if any. If the auditor's mitment program) which has made a It is not timely submitted, the reasonable effort to dispose of it for op

must be established and fully eration as a public or nonprofit health Bed , in accordance with the time care facility. imposed by paragraph (c)(1) of

(51 FR 7939, Mar. 7, 1986, as amended at 57 FR section, and the Secretary will no

8272, Mar. 9, 1992) the owner of the allowable credit, u vithin 30 days of the date of the $ 124.709 Withdrawal of waiver. Beishment of the trust or within 30

(a) Any waiver granted under this of the receipt of the report,

subpart is conditioned upon the recipiherer is later.

ent of the waiver carrying out the oblii The trust shall be administered by

gations imposed by $ 124.707 or $124.708 hatee who is neither an employee

as applicable. la transferee nor an employee of a

(b) The Secretary will monitor comPnöary or of the parent institution

pliance with the community service Tee transferee.

and uncompensated care obligations of The trust shall provide that the

any entity that receives a waiver. is corpus and income may be in

(c) Should a recipient of a waiver fail ***d only in U.S. Government or U.S.

to comply with the applicable condiapenment insured securities.

tions, the Secretary will withdraw the 2. Use of the trust. The corpus and in

waiver and seek recovery based on the te of the irrevocable trust shall be

value of the facility on the date the ned to pay for the costs of uncompen

right of recovery first arose under med services, which may include rea

$ 124.703. fable costs of establishing and ad

(d) No waiver will be withdrawn until fanistering the trust and the cost of

the recipient has been notified in writindependent audit described in

ing by the Secretary of the noncompliRezgraph (b)(1)(i) of this section, until

ance and has failed to take corrective de trust is exhausted.

action within 90 days after the date of Logroved by the orice of Management and

such notice. fdget ander control number 0915-0099)

(e) Should the waiver be withdrawn,

the amount of the Government's recov114708 Waiver of recovery good ery will be the amount set out in the cause for other use of facility.

Secretary's determination letter as deThe Secretary may for good cause scribed in $ 124.707 (b)(1) or (b)(3) as ap pute the recovery rights of the United plicable plus interest from the date of

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