Is a nonprofit cooperative hospital service organization described in Section 501(e) of the Internal Revenue Code (the 'Code') which is exempt from federal taxation pursuant to Section 501(a) of the Code, and which provides supporting services to hospitals, eligible to borrow money from the Michigan State Hospital Finance Authority?

'Detroit Medical Center Cooperative Services (DMCCS) is a cooperative hospital service organization which was incorporated in 1970 as a Michigan nonprofit corporation. DMCCS is organized on a membership basis; the members of DMCCS are:

--Children's Hospital of Michigan

--Detroit Receiving Hospital and University Health Center

--Grace Hospital Division and Harper Hospital Division of Harper-Grace Hospitals

--Hutzel Hospital

--Rehabilitation Institute, Inc.

'All of the members are Michigan nonprofit corporations licensed as hospitals under Article 17, Part 215 of the Public Health Code (Act No. 368 of the Michigan Public Acts of 1978, as amended). They are also all tax exempt, charitable organizations as described in Section 501(c)(3) of the Code.

'Since its incorporation, DMCCS has been operated as a cooperative hospital service organization as described in Section 501(e) of the Code. . . .

'. . . .

'The Articles of Incorporation of DMCCS set forth the sole purpose for which DMCCS was formed:

"To perform, on a centralized basis, for organizations described in Section 501(e)(1)(B) of the Internal Revenue Code, as it has been or may in the future be amended, any or all of the following services: data processing, purchasing, warehousing, billing and collection, food, industrial engineering, laboratory, printing, communications, record center, and personnel services (including selection, testing, training and education).'

"To perform and render such services, to the extent only that such services are required for and incident to the performance of the tax exempt functions of each such organizations.'

'DMCCS performs a number of the above-referenced services, including: the operation of a centralized telephone communications system, a transcription service for medical records, a telepaging system for paging doctors and other staff, the administration and coordination of a graduate medical education program, and the operation of a central computerized electrocardiogram system. The recipients of the services of DMCCS are its member hospitals and certain nonmember hospitals located in Michigan. All of the hospitals to which supporting services are provided by DMCCS are non-profit, non-public hospitals licensed by the Department of Public Health, and are tax exempt organizations as described in Section 501(c)(3) of the Internal Revenue Code.

'Correspondingly, the Internal Revenue Service has determined that DMCCS meets the requirements of Section 501(e), and therefore qualifies as an organization described in Section 501(c)(3).'

'For purposes of this title, an organization shall be treated as an organization organized and operated exclusively for charitable purposes, if--

'(1) such organization is organized and operated solely--

'(A) to perform, on a centralized basis, one or more of the following services which, if performed in its own behalf by a hospital which is an organization described in subsection (c)(3) and exempt from taxation under subsection (a), would constitute activities in exercising or performing the purpose or function constituting the basis for its exemption: data processing, purchasing, warehousing, billing and collection, food, clinical, industrial engineering, laboratory, printing, communications, record center, and personnel (including selection, testing, training, and education of personnel) services; and

'(B) to perform such services solely for two or more hospitals each of which is

(i) an organization described in subsection (c)(3) which is exempt from taxation under subsection (a),

(ii) a constituent part of an organization described in subsection (c)(3) which is exempt from taxation under subsection (a) and which, if organized and operated as a separate entity, would constitute an organization described in subsection (c)(3), or

(iii) owned and operated by the United States, a State, the District of Columbia, or a possession of the United States, or a political subdivision or an agency or instrumentality of any of the foregoing;

'(2) such organization is organized and operated on a cooperative basis and allocates or pays, within 8-1/2 months after the close of its taxable year, all net earnings to patrons on the basis of services performed for them; and

'(3) if such organization has capital stock, all of such stock outstanding is owned by its patrons.'

'AN ACT to create a state hospital finance authority to lend money to nonprofit hospitals for capital improvements or to refinance hospital indebtedness; to provide for the incorporation of local hospital authorities with power to lend money to nonprofit hospitals for hospital indebtedness or to refinance hospital indebtedness; to construct, acquire, reconstruct, remodel, improve, add to, enlarge, repair, own, lease, and sell hospital facilities, to finance outstanding hospital indebtedness; to authorize the authorities to borrow money and issue obligations to accomplish the purposes of this act, including the refunding or advance refunding of obligations issued by 1 or more authorities created or incorporated under this act; to permit the authorities to enter into loans, contracts, leases, mortgages, and security agreements which may include provisions for the appointment of receivers; to exempt obligations and property of the authorities from taxation; and to provide other rights, powers, and duties of the authorities.'

"Hospital' means a nonpublic corporation, association, institution, or establishment located within the state for the care of the sick or wounded or of those who require medical treatment, operated without profit to an individual corporation or association. It includes nonprofit corporations or other organizations engaged solely in some phase of hospital activity or in providing a supporting service to hospitals or public corporations which operate or own hospital facilities.' MCL 331.33(e); MSA 14.1220(3)(e). [Emphasis added.]

"Hospital' means a facility offering inpatient, overnight care, and services for observation, diagnosis, and active treatment of an individual with a medical, surgical, obstetric, chronic, or rehabilitative condition requiring the daily direction or supervision of a physician. The term does not include a hospital licensed or operated by the department of mental health.'

'(1) A hospital shall be licensed under this article.

'(2) 'Hospital' shall not be used to describe or refer to a health facility unless the health facility is licensed as a hospital by the department under this article. This section does not apply to a hospital licensed or operated by the department of mental health or the federal government or to a veterinary hospital.'

'[A] mental hospital, psychiatric hospital, or psychiatric unit is an establishment offering inpatient services for observation, diagnosis, active treatment, and overnight care of persons with a mental disease, or with a chronic mental disease or condition requiring the daily direction or supervision of physicians licensed to practice in the state.'

"Hospital', for purposes of sections 22156 to 22158 only, means a hospital as regulated under part 215, but shall not include a veterans facility operated by the state or federal government.'

'The intent of the Legislature in enacting 1969 PA 38, supra, must be ascertained by reading all of the provisions of the statute. Smalley v Ashland Brown-Stone Co, 114 Mich Commission v Fraternal Order of Eagles, Aerie No. 629, 286 Mich 32; 281 NW 427 (1938). From a reading of all of the cited statutory provisions, it must be concluded that the Legislature intended licensed private hospitals to be eligible for loans from the State Hospital Finance Authority for hospital facilities. The latter includes certain facilities incidental to and necessary for the efficient operation of licensed private hospitals, as well as the erection of an office building, 80 percent of whose space is to be leased to certain licensed or certified health professionals, to meet a demonstrated need as determined by the Department of Public Health and to be geographically or functionally related to one or more hospital facilities, as enumerated in 1969 PA 38, Sec. 3(e)(f)(i), supra. Non-licensed hospital entities are not eligible for such loans.' (Emphasis added.) OAG, 1979-1980, No 5510, supra, at 207-208.