(1) A hospital district may establish a capital replacement fund. The fund may be used only for the replacement of property, plant facilities, or equipment. The cost of such capital equipment must exceed $5,000 and have a life expectancy of 5 years or more.
(2) A capital replacement fund established under subsection (1) may not exceed 10% of the total value of the hospital's property, plant facilities, and equipment at the end of a fiscal year.