Types of Local Health Departments: Public Health Authorities

A public health authority (PHA) is an organization that provides local public health services.  A PHA may be organized as either a single county or a multi-county agency.  It is a government entity that is independent of the county.

As of the publication date of these questions and answers, there are no North Carolina counties operating public health authorities. Cabarrus County’s public health agency is a public hospital authority, which is similar to a public health authority but is subject to some different requirements and restrictions. 

The term “authority” is used to refer to many different kinds of entities that are created by government to perform specific functions or services. In North Carolina, the law allows local governments to establish transportation authorities, water and sewer authorities, public hospital authorities, housing authorities, and others. Each type of authority has its own set of laws that explain how it is created, what powers it holds, and where it may exercise those powers.

The laws that allow these different types of authorities have some similarities and some differences. One important similarity across the different types of authorities is their relative independence from the government entity that created them. For example:

• An authority is typically not required to submit its budget to the city or county for approval. Instead, it develops its own budget and complies with the applicable state financial management laws.[1]
• An authority typically can be sued as an independent legal entity. By comparison, if someone wants to sue a city or county department or program, the suit would need to name the political subdivision as a defendant (i.e., county, city). An authority can also sue others directly without involving any other local government entity.
• An authority can often enter into contracts without seeking approval from any other government entity.

Some key differences relate to how the different types of authorities are created and the powers that they hold. For example:

• A water and sewer authority may be created by a combination of cities and counties whereas a public health authority may be created only by a county or a group of counties.[2]
• Many authorities, including regional transportation authorities, water and sewer authorities, and parking authorities, may issue bonds to generate revenue, while public health authorities may not.[3]
• A public hospital authority may exercise the power of eminent domain to condemn private property but a public health authority may not.[4]

Because there are so many important differences between the applicable laws, it is impossible to identify a universal definition of the term “authority” in North Carolina. 

[1]See G.S. Chapter 159, Article 3.

[2]See G.S. 162A-3; 162A-3.1.

[3]See G.S. 160A-617 (regional transportation authorities); G.S. 162A-6 (water and sewer authorities); G.S. 160A-556 (parking authorities).

[4]See G.S. 131E-24; G.S. 40A-3(c)(3).

No. A public health authority is not a private entity. It is a public entity that is defined by the law that allows for its creation. As a public entity, it is subject to many of the same laws that apply to county departments, such as public records laws, open meetings laws, and the financial management laws that apply to local government entities. The authority is subject to these laws directly rather than as an agency or arm of the county.

A public health authority is not an agency or department of the county but it is also not considered to be a separate political subdivision of the state (like cities and counties). It falls somewhere in the middle and has been described as a “quasi-municipal corporation.”[1]

The U.S. Census of Governments catalogs and evaluates the different types of entities in each state and evaluates their relative independence. In order to be considered a separate unit of government, the entity must:

• Exist as an organized entity,
• Have the characteristics of government (such as having elected or appointed public officials, being subject to public records laws, and/or being responsible for performing a function commonly regarded as a governmental function), and
• Have substantial autonomy, which amounts to “considerable fiscal and administrative independence.”[2]

While a public health authority likely satisfies the first two parts of this test, it probably falls short of the test for substantial autonomy, which requires both fiscal and administrative independence. Specifically, an organization like a public health authority that has “considerable fiscal autonomy” may still be classified as a “dependent” agency for one or more of the following reasons:

• The authority has “control … over facilities that supplement, serve, or take the place of facilities ordinarily provided by the creating government,”
• The authority’s “properties and responsibilities revert to the creating government after … debt has been repaid,” or
• The authority may depend on the county for a substantial part of its revenue. [3]

Even though a public health authority is not a separate political subdivision of the state, it is important to remember that it is still considered a governmental entity. It falls somewhere between a separate local government entity and an agency of local government.

[1]An opinion from the Attorney General’s office regarding a public transportation authority described it this way:  “A public transportation authority is neither a private corporation nor a political territorial subdivision, but instead it is a quasi-municipal corporation [that is]… ‘commonly used in this and other states to perform ancillary functions in government more easily and perfectly by devoting to them, because of their character, special personnel, skill and care.’” N.C. Department of Justice, Advisory Opinion of the Attorney General, from Rufus Edmisten to David D. King (April 5, 1984) (citing Greensboro-High Point Airport Authority v. Johnson, 226 N.C. 1, 36 S.E.2d 803 (1945).

[2]U.S. Census Bureau, 2017 U.S. Census of Governments, Individual State Descriptions, available at https://www.census.gov/library/publications/2019/econ/2017isd.html.

[3]Id. There are other factors considered by the U.S. Census in making this determination, but the three identified above are the only ones that appear to be associated with North Carolina’s public health authority model.

There are two steps that must be taken to create a public health authority: (1) a public hearing and (2) a joint resolution. First, the board of county commissioners must hold a public hearing about the board’s interest in creating an authority. Notice of the hearing must be published at least 10 days before the hearing. See G.S. 130A-45.02.

After the hearing, the county or counties involved may establish an authority. To create a single county public health authority, both the board of county commissioners and the local board of health must adopt a joint resolution that it is in the interest of the public health and welfare to provide public health services to the community through a public health authority. To create a multi-county public health authority or join an existing public health authority, the boards of commissioners and local boards of health in all participating counties must adopt a similar joint resolution.

A public health authority, whether single or multi-county, is governed by a public health authority board (G.S. 130A-45.1) and administered by a public health authority director (G.S. 130A-45.4, 130A-45.5).

Generally speaking, the boundaries of a public health authority are coextensive with those of the county or counties involved.  There is, however, a specific law that allows a public health authority to “provide or contract to provide public health services and to …own, or operate…any public health facilities outside the territorial limits within reasonable limitation, of the county or counties creating the authority.”[1] There is no guidance in the law about what constitutes a “reasonable limitation” on this expanded jurisdiction.

It is important to note that all of the different models, including authorities, are allowed to enter into contracts with other jurisdictions to provide services outside the county’s jurisdiction.[2] Such agreements could involve the location or operation of facilities.  The key difference for a public health authority is that it may provide the services or have facilities in other counties without having such an agreement in place.[3]

[1]G.S. 130A-45.6.

[2]G.S. 160A, Article 20, Part 1 (specifying guidelines for interlocal agreements and joint agencies).

[3]The law emphasizes that providing services outside the county or counties involved is an option, not a requirement. It states that public health authorities may not be held liable for failing to provide public health services beyond the territorial limits of the county or counties involved. G.S. 130A-45.6.

A county may withdraw from a multi-county public health authority when a majority of the county’s commissioners determines that the district is not operating in the best interests of health in that county. A public health authority may be dissolved upon a similar decision by the boards of commissioners of all the counties in the district. Withdrawal or dissolution may take place only after written notice is given to the North Carolina Department of Health and Human Services. Withdrawal or dissolution will only become effective at the end of the fiscal year in which the action of dissolution or withdrawal transpired.  A certified public accountant or an auditor certified by the Local Government Commission distributes surplus funds to the counties according to the percentage each of them contributed to the authority’s budget during the current fiscal year.

When an authority dissolves or when a county withdraws, any rules adopted by the public health authority board remain in effect in the county or counties involved until amended or repealed by the new authority board or boards of health governing the affected counties.

See G.S. 130A-45.2.

A single county public health authority board may have seven to nine members and a multi-county public health authority board may have up to eleven members. In some instances, a public health authority may want to apply to the federal government to become a community health center so that it may be eligible for additional funding from specific federal programs.[1] The federal law governing community health centers has strict requirements related to board membership. Therefore, state law allows a public health authority interested in applying for that status to have up to 25 board members.

The public health authority board must include the following members: 

• a county commissioner (or the commissioner’s designee) from each county in the authority;
• a physician licensed to practice in North Carolina;
• a dentist licensed to practice in North Carolina;
• at least two licensed or registered professionals from any of the following categories:  optometry, veterinary science, nursing, pharmacy, engineering, or accounting;
• a member of the administrative staff of a hospital serving the authority service area; and
• a member of the general public.

Members of a single county board are appointed by the board of county commissioners.  In a multi-county board, the chair of each board of commissioners appoints the commissioner member (or the commissioner’s designee) and those members jointly appoint the other members of the authority board.

See G.S. 130A-45.1.

[1]See G.S. 130A-45.1(a) (“Boards which intend to pursue federally qualified health center (or look-alike) status may have no fewer than nine and no more than 25 members.)

No. Public health authority board members are appointed to three-year terms (G.S. 130A-45.1(d)). In order to establish a uniform staggered term structure for the Board, a member may be appointed for less than a three-year term. Unlike other types of public health boards, public health authority board members are not subject to any term limits.

Yes. A public health authority board member may be removed for any of the following reasons: 

• Commission of a felony or other crime involving moral turpitude
• Violation of a state law governing conflict of interest
• Violation of a written policy adopted by the boards of county commissioners of each county in the district
• Habitual failure to attend meetings
• Conduct that tends to bring the office into disrepute
• Failure to maintain qualifications for appointment (e.g., maintaining licensure in a profession)

See G.S. 130A-45.1(j).

The public health authority board may take action to remove members of its own board. Before it acts to remove a member, the board must give the member written notice of the basis for removal and provide an opportunity for the member to respond.

See G.S. 130A-45.1(j).

A public health authority board has many of the same powers and duties as the other public health boards. This is because the term “local board of health” is defined in the law to include county boards of health, district boards of health and public health authority boards.[1]  Therefore, all of the powers and duties granted to “local boards of health” under the law extend to all three types of boards.[2] For example, a local board of health:

• Must protect and promote public health in its jurisdiction,[3]
• May adopt local health rules (i.e., regulations) that apply throughout the authority’s jurisdiction, including within any municipalities,[4]
• Hear appeals based upon enforcement of rules adopted by the local board of health, or imposition of administrative penalties by the local health director,[5] and
• May appoint the health director.[6]

The law that applies to public health authority boards, however, modifies and supplements that list of powers and duties.[7]  For example:

• Fee setting: The board is not required to obtain the approval of county commissioners when setting fees.
• Personnel: The board establishes a salary plan for its employees.  In other models, employees are subject to either the State Human Resources Act or a county pay plan.

A public health authority board also has quite a few powers and duties that are related to the operation of the authority as an independent entity.  These include the ability to enter into contracts, employ legal counsel, purchase insurance, and become directly involved in lawsuits. For county health departments and consolidated human services agencies, those powers and duties are held by the county. 

Unlike some other types of authorities or districts, a public health authority does not have the power to issue revenue bonds or levy taxes.

[1]G.S. 130A-2(4).

[2]G.S. 130A-24, 130A-39.

[3]G.S. 130A-39(a); 130A-45.3(a)(1).

[4]G.S. 130A-39(a) - (c); 130A-45.3(a)(1).

[5]G.S. 130A-24.

[6]G.S. 130A-40; 130A-45.3(6).

[7]G.S. 130A-45.3.

In general, no – but there is an exception. Rules pertaining to smoking in public places must be approved by the county commissioners.[1]

The public health authority board appoints a public health authority director, who must meet qualifications set forth in state law. The board must consult with the county commissioners of each county in the authority’s jurisdiction before making the appointment. The public health authority director hires, and may dismiss, employees of the authority.

A public health authority director must meet minimum education and experience requirements prescribed in law (G.S. 130A-45.4(b)). The director must have one of the following:

• A medical doctorate;
• A master’s degree in public health administration plus at least one year of employment in health programs or services;
• A master’s degree in another public health discipline plus at least three years of employment in health programs or health services;
• A master’s degree in public administration plus at least two years of experience in health programs or health services;
• A master’s degree in a field related to public health plus at least three years of experience in health programs or health services[1]; or
• A bachelor’s degree in public health administration or public administration plus at least three years of experience in health programs or health services.

[1]The State Health Director must review requests by educational institutions to determine whether a master’s degree offered by the institution is related to public health for purposes of this law.

A public health authority establishes and is responsible for its own budget. Funding for all types of local public health agencies comes from several sources, including federal funds (which are often “categorical”—that is, designated for particular services), state funds, and local appropriations from the county or counties served by the public health agency. To receive local appropriations, a public health authority board submits a budget request to the board or boards of commissioners within the authority’s jurisdiction.  The request could take various forms, including specific funding requests for programs or staff or a contribution based on population (per capita).

Many local public health agencies receive grant or contract funding from public or private sources. Local agencies may also generate revenue from fees for services. Fees for clinical services may be paid by third-party payers, including Medicaid, NC Health Choice, or other public or private insurers. In some cases clients themselves may be charged a fee for clinical services, but charges to a client may be prohibited or limited by law. The public health authority board may impose fees for other local services, such as on-site wastewater or private drinking water well permits, subject to limits imposed in state law.

No. State law expressly prohibits the board of county commissioners from abolishing a public health authority board and assuming its powers and duties, even if the board is governing a single county public health authority.

See G.S. 153A-76(5).

In Cabarrus County, public health services are provided through a “public hospital authority.” Special legislation was enacted in 1997 that allowed for this unique arrangement.[1]  There are many similarities between public health authorities and public hospital authorities. For example, they both provide public health services, and have governing boards and directors. They are both “authorities,” which means that they are public entities that are somewhat independent from the county or counties that created them. As independent entities, they have the authority to enter into contracts, employ legal counsel and staff, and purchase insurance. They are also both responsible for their own budgets and financial management.

There are, however, some key differences between the two types of authorities: 

• Governing board:  The members of the governing board of a hospital authority are called “commissioners.”  The law requires the appointment of between six and thirty commissioners and the chair of the board of county commissioners appoints all of the members (G.S. 131E-18). A hospital authority commissioner may be removed by the chair of the board of county commissioners for inefficiency, neglect of duty, or misconduct in office (G.S. 131E-22).

• Powers and duties:  A hospital authority has many of the same powers and duties as a public health authority but there are a few additional ones that are worth noting. Specifically, the hospital authority may borrow money (i.e., issue revenue bonds) and exercise the power of eminent domain (i.e., acquire real property by condemnation). See G.S. 131E-23, 131-24. In addition, the hospital authority has quite a few powers and duties directly related to the operation and staffing of a hospital. See G.S. 131E-23.

• Conflict of interest:  Commissioners and employees of a hospital authority are subject to a separate law governing conflict of interest related to ownership interests in hospital facilities, contracts, and services (G.S. 131E-21).

• Jurisdiction: A hospital authority may be created by a single county (or a city) and its jurisdiction may extend 10 miles beyond the county’s border (G.S. 131E-20). The law does not allow for a multi-county public hospital authority but there could be agreements in place to provide services in other counties.

[1]S.L. 1997-502, Section 12 (“Any county which, on or prior to July 1, 1997, established a hospital authority board composed of no more than seven members under the provisions of Part B of Article 2 of Chapter 131E of the General Statutes may, by resolution adopted by its board of county commissioners and with the approval of the State Health Director, assign that authority board the powers, duties, and responsibilities to provide public health services as outlined in G.S. 130A-1.1. Thereafter, such authority board shall act as the local board of health for the county together with such additional powers, duties, and authority assigned to it by the board of county commissioners.”)