Code of the District of Columbia

§ 44–601. Findings.

The Council finds and declares the following:

(1) Charitable healthcare entities hold all their assets in trust, and those assets are irrevocably dedicated, as a condition of their tax-exempt status, to the specific charitable purposes set forth in the articles of incorporation of the entities.

(2) The public is the beneficiary of that trust.

(3) Healthcare entities have a substantial and beneficial effect on the quality of life of the people of the District of Columbia, providing as part of their charitable mission a large list of services to low-income families and the poor, elderly, and people with disabilities.

(4) Transfers of the assets of healthcare entities, such as by sale, joint venture, or other sharing of assets, to for-profit entities directly affect the charitable uses of those assets and may adversely affect the public as the beneficiary of the charitable assets.

(5) The Attorney General for the District of Columbia is entrusted by common law to bring actions on behalf of the public in the event of a breach of the charitable trust of a healthcare entity and to represent the public in the sale or other transfer of the assets of a healthcare entity.

(6) It is in the best interest of the public to ensure that the public interest is fully protected whenever the assets or operations of a healthcare entity are transferred, directly or indirectly, from a charitable trust to a for-profit or mutual benefit entity.

(7) The approval by the Attorney General for the District of Columbia of any transfer of assets or operations is necessary to ensure the protection of these trusts.