Following is a condensation of the state laws which jump out upon researching the formation of a hospital district.  This list is not the result of a diligent search, and you should read the complete statutes yourself.  They're available at
.  http://www.azleg.gov/ArizonaRevisedStatutes.asp?Title=48

The statutes say how a district can be formed, what it can do after it's formed, and how it can be dissolved.

ARS 48-261. District creation; procedures; notice; hearing; determinations; petitions
- A. A fire ... hospital district for either a hospital or an urgent care center shall be created by the following procedures:
- - 1. Any adult person desiring to propose creation of a district shall provide a legal description of the area proposed ... to the county assessor ....  The county assessor shall provide to the person ... a detailed list of all taxed properties in the area proposed for inclusion in the district.  The person ... shall prepare and submit a district impact statement to the board of supervisors ....  If the person ... is unable to complete the ... statement, the board of supervisors may assist in the completion of the ... statement if requested to do so, provided the bond required in subsection C [below] is ... sufficient to cover any additional cost to the county.  The district impact statement shall contain at least ... :
- - - (a) A legal description of the boundaries of the proposed district and a map and a general description of the area ... sufficiently detailed to permit a property owner to determine whether a particular property is within the proposed district.
- - - (b) The detailed list of taxed properties provided by the assessor ....
- - - (c) An estimate of the assessed valuation within the proposed district.
- - - (d) An estimate of the change in the property tax liability, as a result of the proposed district, of a typical resident of the proposed district.
- - - (e) A list and explanation of benefits that will result from the proposed district.
- - - (f) A list and explanation of the injuries that may result from the proposed district.
- - - (g) The names, addresses and occupations of the proposed members of the district's organizing board of directors.
- - - (h) A description of the scope of services to be provided by the district during its first five years ....  At a minimum this description shall include an estimate of anticipated capital expenditures, personnel growth and enhancements to service.
- - 2. On receipt of the district impact statement, the board of supervisors shall set a day, not fewer than thirty nor more than sixty days from that date, for a hearing on the impact statement.  The board of supervisors, at any time before making a determination pursuant to paragraph 4 of this subsection, may require that the impact statement be amended to include any information that the board of supervisors deems to be relevant and necessary.
- - 3. On receipt of the district impact statement, the clerk of the board of supervisors shall mail, by first class mail, notice of the day, hour and place of the hearing on the proposed district to each owner of taxable property within the boundaries of the proposed district.  The written notice shall state the purpose of the hearing and shall state where a copy of the impact statement may be viewed or requested.  The clerk ... shall post the notice in at least three conspicuous public places in the area of the proposed district and shall publish twice in a daily newspaper of general circulation in the area of the proposed district, at least ten days before the hearing ... a notice setting forth the purpose of the impact statement, the description of the area of the proposed district and the day, hour and place of the hearing.
- - 4. At the hearing ... the board of supervisors shall hear those who appear for and against the proposed district and shall determine whether the creation of the district will promote public health, comfort, convenience, necessity or welfare.  If the board of supervisors determines that the public health, comfort, convenience, necessity or welfare will be promoted, it shall approve the district impact statement and authorize the persons proposing the district to circulate petitions as provided in this subsection....  The order of the board of supervisors shall be final, but if the request to circulate petitions is denied, a subsequent request for a similar district may be refiled with the board of supervisors after six months from the date of such denial....
- - 5. Within fifteen days after receiving the approval of the board of supervisors ... the clerk of the board shall determine the minimum number of signatures and assessed valuation required for compliance with paragraph 7 of this subsection.  After making that determination, the number of signatures shall remain fixed and the assessed valuation of the taxed properties within the boundaries of the proposed district shall remain fixed for purposes of determining compliance with the property valuation requirement prescribed in paragraph 7 of this subsection.
- - 6. After receiving the approval of the board of supervisors ... any adult person may circulate and present petitions to the board of supervisors ....  All petitions circulated shall be returned to the board of supervisors within one year from the date of the approval of the board of supervisors ....
- - 7. The petitions ... shall comply with the provisions regarding verification in section 48-266 and shall:
- - - (a) At all times, contain a map and general description of the boundaries of the proposed district sufficiently detailed to permit a property owner to determine whether a particular property is within the proposed district and the names, addresses and occupations of the proposed members of the district's organizing board of directors.  No alteration of the proposed district shall be made after receiving the approval of the board of supervisors ....  The items required to be contained with the petition ... shall be printed on the back of the petition form ... unless the size of the items preclude[s] this requirement.  An error in the legal description of the proposed district shall not invalidate the petitions if considered as a whole the information provided is sufficient to identify the property as illustrated in the map required pursuant to subsection A of this section.
- - - (b) Be signed by owners of more than one-half of the taxed property units in the area of the proposed district and be signed by persons owning collectively more than one-half of the assessed valuation of the property in the area ....  Property exempt pursuant to title 42, chapter 11, article 3 shall not be considered in determining the total assessed valuation of the proposed district nor shall owners of property not subject to taxation be eligible to sign petitions.
- - 8. On receipt of the petitions, the board of supervisors shall set a day, not fewer than ten nor more than thirty days from that date, for a hearing on the petition.  The hearing shall be postponed if a timely request to supplement petition signatures is made ....  The postponed hearing shall be held no more than thirty days after the submission of any supplemental petition signatures.
- - 9. Before the hearing ... the board of supervisors shall determine the validity of the petitions presented.
- - 10. At the hearing ... the board of supervisors, if the petitions are valid, shall order the creation of the district.  The board of supervisors shall enter its order setting forth its determination in the minutes of the meeting, not later than ten days from the day of the hearing, and a copy of the order shall be filed in the county recorder's office.  The order ... shall be final, and the proposed district shall be created thirty days after the board of supervisors votes to create the district ....  A decision of the board of supervisors under this subsection is subject to judicial review under title 12, chapter 7, article 6.
- B. For the purpose of determining the validity of the petitions ... :
- - 1. Property held in multiple ownership shall be treated as if it had only one property owner, so that the signature of only one of the owners of property held in multiple ownership is required on the formation petition.  The number of persons owning property inside the ... proposed district shall be determined as follows:
- - - (a) In the case of property assessed by the county assessor, the number of persons owning property shall be as shown on the most recent assessment of property.
- - - (b) In the case of property valued by the department of revenue, the number of persons owning property shall be as shown on the most recent valuation of property.
- - - (c) If an undivided parcel of property is owned by multiple owners, those owners are deemed to be one owner ....
- - - (d) If a person owns multiple parcels of property, that owner is deemed to be a single owner ....
- - 2. The value of property shall be determined as follows:
- - - (a) In the case of property assessed by the county assessor, values shall be the same as those shown on the last assessment roll of the county containing such property.
- - - (b) In the case of property valued by the department of revenue, the values shall be those determined by the department in the manner provided by law, for municipal assessment purposes.  The county assessor and the department of revenue, respectively, shall furnish to the board of supervisors, within twenty days after such a request, a statement in writing showing the owner, the address of each owner and the appraisal or assessment value of properties contained within the ... proposed district ....
- - 3. Petition signatures on which taxes and assessments are not current at the time of petition review shall be invalidated.
- C. The board of supervisors may require of the person desiring to propose creation of a district ... a reasonable bond to be filed with the board at the start of proceedings under this section.  The bond shall be in an amount sufficient to cover costs incurred by the county if the district is not finally organized....
- D. If a district is created ... , the cost of publication of the notice of hearing, the mailing of notices to property owners and all other costs incurred by the county as a result of this section shall be a charge against the district.
- E. If a proposed district would include property located within an incorporated city or town, in addition to the other requirements of subsection A of this section, the board shall approve the creation and authorize the circulation of petitions only if the governing body of the city or town has by ordinance or resolution endorsed such creation.
- F. Except as provided in section 48-851 and section 48-2001, subsection A ... a district ... shall be contiguous.
- G. A district ... shall have an organizing board of directors to administer the affairs of the district until a duly constituted board of directors is elected as provided in this title.  The organizing board shall have all the powers, duties and responsibilities of an elected board.  The organizing board shall consist of the three individuals named in the district impact statement and the petitions presented pursuant to subsection A of this section.  If a vacancy occurs on the organizing board, the remaining board members shall fill the vacancy by appointing an interim member.  Members of the organizing board shall serve without compensation but may be reimbursed for actual expenses incurred in performing their duties.  The organizing board shall elect from its members a chairman and a clerk.
- H. For ... this section assessed valuation does not include property exempt pursuant to title 42, chapter 11, article 3.

48-266. Petitions of property owners; form; verification
- A. The secretary of state shall promulgate sample petition forms, with instructions for completing the form, that comply with the requirements of this statute.  Petitions that conform to the sample form will be deemed to have complied with sections B, C and D of this section.  Petitions that do not conform to the sample petition are void and shall not be counted in determining the legal sufficiency of the petition.
- B. A petition of property owners that is submitted to comply with section 48-261, subsection A, paragraph 7 shall contain a heading that clearly identifies the type of petition circulated and a statement that clearly describes the type of action being proposed.  The petition shall be in a form that is substantially similar to the following:
- - "Special taxing district creation petition
- - "To the board of supervisors of [Cochise] county:
- - "We the undersigned, property owners of [Cochise County], state of Arizona and owning property within the boundaries as illustrated and defined on the attached exhibit(s), legal description and map of the proposed boundaries, petition the county board of supervisors to create a (insert description of district) as described in the attached exhibit(s).  I have personally signed this petition with my first and last names.  I have not signed any other petition for the same measure.  I am a property owner of the state of Arizona, county of [Cochise].
- - "Notice:  this is only a description of the district sought to be created by the sponsor of the measure.  It may not include every provision contained in the measure.  Before signing, make sure the exhibits are attached.  You have the right to read or examine the district impact statement before signing.
- - "Warning
- - "It is a class 1 misdemeanor for any person to knowingly do any of the following:
- - - "1. Sign a district creation petition with a name other than the person's own name, except in a circumstance where the person signs for another person, in the presence of and at the specific request of that person, who is incapable of signing that person's own name because of physical infirmity.
- - - "2. Sign the person's name more than once for the same measure.
- - - "3. Sign a district creation petition if the person is not a property owner.
- - [Then the statute gives the columns that will appear in a petition:  columns for the signature, the printed name, the address (actual or P.O. box), the city, and the date.]  (Fifteen numbered lines for signatures)
- ...
- D. Each petition sheet shall have printed in capital letters in no less than twelve point bold-faced type in the upper right-hand corner of the face of the petition sheet the following:
- - "'______ paid circulator' '______ volunteer'"
- E. A circulator ... shall state whether the circulator is a paid circulator or volunteer by checking the appropriate line on the petition form before circulating the petition for signatures
- F. ... The presence of signatures that are invalidated under this subsection on a petition does not invalidate other signatures on the petition that were obtained as prescribed by this section.
- G. At the time of signing, the property owner shall sign the property owner's first and last names in the spaces provided and ... shall print the first and last names and write, in the appropriate spaces following the signature, the signer's residence address, giving street and number, and if property owner has no street address, a description of the residence location.  The property owner ... or the person circulating the petition shall write, in the appropriate spaces following the property owner's address, the date on which the property owner signed the petition.
- H. The title and text of petitions shall be in at least eight point type.
- I. The eight point type required by subsection G of this section does not apply to maps, charts or other graphics.
- J. The board of supervisors ... that receives a petition pursuant to this section shall submit a copy of the signature sheets to the county assessor for verification.  The county assessor shall:
- - 1. Verify that the petition contains the names of more than one-half of the property owners in the area of the proposed district.
- - 2. Determine the total assessed valuation of the property owned by the persons whose names are signed on the petition.
- K. The county assessor shall report the results of the verification to the board of supervisors ... within ten days after receiving the copy of the signature sheets, not including Saturdays, Sundays and other legal holidays.
- L. If the report of the county assessor prepared pursuant to subsection K of this section determines that the valid signatures submitted are insufficient to meet the requirements of section 48-261, subsection A, paragraph 7, subdivision (b) and the one-year period to submit signatures pursuant to section 48-261, subsection A, paragraph 6 has not yet expired or section 48-262, subsection A, paragraph 10, subdivision (b), and the one-year period to submit signatures pursuant to section 48-262, subsection B, paragraph 3 has not yet expired, the person submitting the petitions may request that any hearing on the petitions be extended by a period of up to thirty days to permit submission of additional petition signatures....

ARS 48-271(A). Board of supervisors authority to approve or deny formation of special district
- Notwithstanding any provision of law for the formation of a special taxing district, the county board of supervisors has the absolute authority to deny the formation, other than under chapter 4, 11, 12, 17, 18, 19 or 22 of this title, of a special district in that county, if sufficient grounds exist for such formation denial....

ARS 48-272. Special district boundary requirements; parcel splits prohibited
-- A special taxing district ... shall include only entire parcels of real property ... and shall not split parcels.


SPECIAL PROVISIONS FOR HOSPITAL DISTRICTS ONLY

ARS 48-1901. Definitions
- In this article, unless the context otherwise requires:
- - ...
- - 2. "Urgent care center" does not include a medical clinic but means a health care institution that operates twelve to twenty-four hours a day seven days a week without inpatient beds but with facilities and limited hospital services for the physical evaluation of outpatients and the diagnosis or treatment of patients including surgery under general anesthesia.

ARS 48-1903. Establishment of a hospital district; approval
- In addition to the requirements for the establishment of a hospital district as set forth in section 48-261, no petition for the formation of a district shall be acted upon unless the area encompassed within the proposed district is first approved by the department of health services as an area needing additional hospital facilities.  Notwithstanding section 48-261, subsection E, a hospital district may exclude natural geographic features such as watercourses.

ARS 48-1907. Powers of hospital district
- A. A hospital district may:
- ...
- - 5. Provide for the operation and maintenance at a single location within the district of a hospital, urgent care center, combined hospital and ambulance service when authorized to do so pursuant to title 36, chapter 21.1, article 2, or combined urgent care center and ambulance service, when authorized to do so pursuant to title 36, chapter 21.1, article 2, owned or operated by the district.  If the hospital district provides for the operation of an ambulance service, ambulance services shall be provided to all areas within the district.  An existing hospital district [in Cochise County] that is operating at a single location may expand to a second location if the board of directors of the hospital district finds at a public hearing on the matter that an additional location is reasonably necessary for the persons served by the district.
- - 6. Impose a secondary property tax on all taxable property within the district for the purpose of funding the operation and maintenance of a hospital, urgent care center, combined hospital and ambulance service or combined urgent care center and ambulance service that is owned or operated by the district or to pay costs of an ambulance service contract entered into pursuant to this section.  The amount of the levy necessary for the operation and maintenance of the ambulance service, if any, shall be separately stated in the levy.  Prior to the initial imposition of such a tax a majority of the qualified electors must approve such initial imposition.  The continued imposition of such a tax must be approved by a majority of the qualified electors at least every five years ....
- - 7. Contract with an existing hospital, ambulance service, city, town or fire district within the district to provide ambulance related services.  If the district does contract for ambulance services, the district shall ensure that ambulance services are provided to all areas within the district.  No such contract may provide for the use of aircraft.
- B. The amount of a levy under subsection A, paragraph 6 shall not exceed the greater of:
- - 1. Six hundred thousand dollars, adjusted annually from a 1989 base year according to the health services component of the metropolitan Phoenix consumer price index published by the bureau of business and economic research, college of business administration, Arizona state university, or its successor.
- - 2. Ten per cent of the hospital's or urgent care center's total expenses for all purposes required or authorized by this chapter and incurred in the fiscal year ending immediately before the levy.
- C. An existing hospital may be converted into an urgent care center by a vote of the board of directors of the district if the conversion is in the best interests of the district.  An existing urgent care center shall not be converted into a hospital unless the hospital district is created pursuant to section 48-261 and this chapter.

ARS 48-1908. Board of directors; members; qualifications; terms; organization
- A. The board of directors ... shall be composed of five citizens who are resident real property owners within the district, none of whom is an elective or appointive state, county or city official.
- B. Directors shall serve four year terms ....
- C. Candidates for a district board office shall file nominating petitions with the board of supervisors ....  If only one person files or no person files a nominating petition for an election to fill a position on the board for which the term of office is to expire, then the board may cancel the election for that position and appoint the person who filed a nominating petition to fill the position.  If no person files a nominating petition for an election to fill a district office, the board of supervisors may cancel the election for that office and that office is deemed vacant and shall be filled as otherwise provided by law.  Vacancies occurring other than by expiration of term may be filled by the remaining directors, except that if the remaining directors do not constitute a quorum, the county board of supervisors shall make the appointment to fill the vacancy.
- ...
- E. Not later than sixty days after an election the board shall meet and reorganize by electing from its membership a chairman and a vice-chairman.  In addition thereto, the board may appoint a secretary who shall not be a member of the board and who may be paid a salary fixed by the board.

ARS 48-1909. Compensation of directors
- ... directors shall serve without compensation, but each shall be allowed necessary travel and incidental expenses actually incurred in the performance of official business of the district as approved by the board, and statutory per diem when away from the district on business of the district.

ARS 48-1910. Powers of board of directors; transaction privilege tax; election
- A. The board of directors may purchase ... property and supplies necessary for equipping a hospital, urgent care center, combined hospital and ambulance service or combined urgent care center and ambulance service, except that the board shall not purchase, rent or contract for the use of aircraft.  The board may purchase real property, and erect or rent and equip buildings or rooms necessary for the hospital, urgent care center, combined hospital and ambulance service or combined urgent care center and ambulance service.
- B. The board of directors shall lease the hospital as provided by section 48-1911, provided however that after all bonded indebtedness of the district has been paid the board of directors may lease the hospital and its equipment to any person or corporation for the purpose of conducting a health care facility upon such terms and conditions as the board of directors of the district deems to be beneficial to the hospital district.
- ...
- D. A hospital district shall not levy a transaction privilege tax at the same time that it is imposing a secondary property tax pursuant to section 48-1907.

ARS 48-1912(A). Bonds
- Bonds may be issued by the hospital district for the purpose of carrying out any of the provisions of this article....

ARS 48-1913. Limit of bonded indebtedness
- No hospital district shall incur a bonded indebtedness exceeding ten per cent of the assessed value of all taxable property in the district as shown by the last assessment roll of the county.


ARS 48-1914. Budget
- A. Annually, not later than July 15, the board of directors shall furnish to the board of supervisors ... a report of the operation of the district for the past year together with an estimate in writing of the amount of money needed to be raised by taxation for all purposes required or authorized by this article during the next fiscal year.
- B. The board of supervisors ... shall thereupon levy upon the taxable property of the district a tax which will, together with other funds on hand or which will accrue during the ensuing fiscal year, exclusive of reserves, provide sufficient funds to meet the financial needs of the district as provided under subsection A....  The district shall be governed by the budget limitation laws of the state.

ARS 48-1915. Deposit and payment of district funds; investment and reinvestment of sinking fund
- A. Monies received for a hospital district from any source shall be deposited with the county treasurer ... to the credit of the hospital district, and paid out only upon warrants approved by the board of directors of the district.
- B. The board of directors of the district, with the consent of the board of supervisors, may invest and reinvest all money belonging or credited to the district as a sinking fund.  The investment shall be made for the best interests of the district....

ARS 48-1917. Capital outlays
- A. The board of directors may establish a fund for capital outlays. After a capital outlay fund is created, the board of directors may transfer to the fund any unincumbered surplus funds remaining on hand ... at the end of a fiscal year.
- B. When a capital outlay fund is established, it shall be used only for capital outlay purposes, but the board of directors may, by a four-fifths vote of all members, if it finds that the fund is no longer necessary or that there remain in the fund monies which are no longer required for capital outlay purposes, discontinue the fund or transfer as much of it as is no longer required for capital outlay purposes to the payment of outstanding bonds, or if there are none, to any fund for payment of current expenses of the district.

ARS 48-1918. Dissolution of district
- A district ... may be dissolved by the majority vote of all real property taxpaying electors voting ... at a special election called to vote on the question.  The election shall be called by the board of supervisors upon application of the board of directors of the district or upon filing a petition signed by twenty-five per cent of the electors of the district.  If a district is dissolved, all property ... owned by the district shall thereupon become the property of the county.

ARS 48-1919. Reimbursement for county services
- Services provided by a county to a hospital district are subject to reimbursement pursuant to section 11-251.06.