Redbud Hospital District was established in 1964 to build and operate Redbud Community Hospital. When the District was formed, the need for providing high quality health care was the establishment of the Hospital. Thus, revenue received by the District was used to help support the operation. However, as time went by, revenue received was used to help provide home health services, health clinic services, free immunization clinics, free health screening, health care seminars, etc. The State Legislature recognized this overall purpose of Hospital Districts, and, in 1994, Senate Bill SB 1169 changed the name of all Districts to Health Care Districts and expanded their responsibilities. Today, only a small number of the Health Care Districts in the State still operate hospitals. The remainder provide health care services to their citizens in various forms similar to the Redbud Health Care District.

Redbud Community Hospital started to have real financial problems in the early to mid 1990s due to dramatic changes in the healthcare industry, declining revenue and rising costs. In 1995, similar to over 50 per cent of California small or rural hospitals, Redbud lost money. As a result, access to healthcare services by rural Californians became a growing problem. This resulted in an Independent Auditor's Report stating that Redbud Community Hospital would have trouble continuing to operate. Thus, on July 1, 1997, the District, with an 89 % voter approval, sold the Hospital to Adventist Health.

For the District, the most important aspects of the sale were that the District continued to operate and the District retained their operating funds, which are based primarily on property tax revenue. Thus, the tax revenue that had been used to help pay for Redbud Community Hospital operating costs, is now available and used for a multitude of other health care needs in the District.

It is important to note that, although the District no longer owns the Hospital (now known as St. Helena Hospital Clear Lake), it is a major source for health care within the District. Thus, over the years, the District has provided Grant funds for advanced Hospital equipment needs, and, more recently, Grant funds for a new state-of-the-art Emergency Room expansion. This later Grant is especially important as many District residents utilize the Emergency Room as their primary source of health care. For more information regarding the Emergency Room Expansion Campaign visit the web site www.NewERforYou.com. In addition, the Hospital Sale Agreement requires that one District Board Member also be on the Adventist Health Hospital Governing Board.