Part 1. TEXAS DEPARTMENT OF INSURANCE

Chapter 5. PROPERTY AND CASUALTY INSURANCE

Subchapter J. RULES TO IMPLEMENT THE AMUSEMENT RIDE SAFETY INSPECTION AND INSURANCE ACT

28 TAC §§5.9001 - 5.9014

The Texas Department of Insurance proposes amendments to §§5.9001 - 5.9014, Subchapter J, concerning rules to implement the Amusement Ride Safety Inspection and Insurance Act (the Act). This proposal is necessary to implement legislation enacted by the 76th Legislature in House Bill 1059. House Bill 1059 amended and added certain sections to Chapter 2151, Title 13, Occupations Code and to the Penal Code which set forth requirements for amusement rides in this state. Among other things, the legislation specifies new reporting requirements for persons who operate amusement rides and further requires the commissioner to adopt rules requiring operators of mobile amusement rides to perform inspections of mobile amusement rides, including rules requiring daily inspections of safety restraints, and rules requiring that a sign be posted to inform the public how to report an amusement ride that appears to be unsafe or to report an amusement ride operator who appears to be violating the law. The department has interviewed representatives from the amusement ride industry, has observed the operation of various outdoor amusement parks, and has researched the literature regarding amusement rides in developing its proposal to implement the new legislation. Currently, there are 134 fixed amusement ride parks in Texas and approximately 128 traveling shows that contain mobile amusement rides located and operating in Texas which are on file with the department. The department has obtained examples of the industry's offerings of other similar safety signs in developing its recommendations for the sign as required by the new legislation. The purpose of the proposed amendments is to administer the law regarding the regulation of amusement rides and to set forth the rules for the inspections, reporting, and sign requirements as set forth in the statute. Proposed amended §5.9001 updates the references to re-codified sections of the Insurance Code and clarifies the reference to "inspector" in accord with the Act. Proposed amended §5.9002 conforms the definitions to the newly enacted legislation by adding definitions for "commissioner", "mobile amusement ride", and "owner/operator" and amending the definitions of "Class A amusement ride" and "inspection." Proposed amended §5.9003 increases the fee to $40 per year for each amusement ride as set forth in the new legislation and updates the revised TDI form AR-100 (Amusement Ride Certificate of Inspection/Re-Inspection). Proposed amended §5.9004 contains updated references to statutes and adds the new requirements of House Bill 1059 regarding inspections, inspection certificates, and mobile amusement ride inspections, including daily inspection requirements. It further implements the enforcement section of the Act regarding the requirements that must be met before an amusement ride may resume operation after its operation has been prohibited. It also adopts by reference a new form, TDI Form AR-300 (Daily Inspection Record), specifying the daily inspection requirements for mobile amusement rides including safety restraints on each mobile amusement ride. It further adopts by reference a new form, TDI Form AR-101 (Texas Amusement Ride Compliance Sticker), which replaces the current AR-101 form that is proposed for repeal. This weatherproof form is returned with each inspection certificate as confirmation of the required insurance and inspection certificate pursuant to the Act and is affixed to the appropriate amusement ride or device in a place easily visible to all ride participants. The form has been re-formatted and re-designed in accord with the updated requirements of legislation. The amended section has also revised the requirements regarding the schedule of operating locations for mobile operations, which is currently included on the inspection certificate, by adopting by reference new TDI Form AR-102, Amusement Ride Schedule of Operations in Texas. This new form requires a schedule of operating locations and dates for each six-month period for mobile operations instead of the current one-year period in order to achieve more complete reporting. It also provides for an amended TDI Form AR-102 to be filed in the event of any changes in the schedule. The amended section also clarifies that combined single limit policies are not acceptable unless the policy specifically provides at least the minimum limits for injury to persons as required by the Act. Proposed amended §5.9005 deletes certain references to training and experience of inspectors to reflect the requirements of the statute, as amended by House Bill 1059, concerning the duties of an insurer or a person with whom the insurer has contracted in regard to the inspection of amusement rides. The department proposes to amend §5.9006 by stating the new legislative requirements of a sign to be posted to inform the public how to report an amusement ride that appears to be unsafe or to report an amusement ride operator who appears to be violating the law. The proposed amendment specifies the content and size requirements of the sign and requires that the sign be posted at the principal entrance(s) to the site at which an amusement ride is located or at any location on that site at which tickets for an amusement ride are available. It must be printed in both English and Spanish. The department specifically invites comments and recommendations from the public as well as industry input concerning the required posted sign. The amended section further deletes the requirements regarding the designation of safety inspector for amusement rides and devices and deletes the form referenced therein (titled "Qualification Review for Inspectors of Carnival--Amusement Rides and Devices," TDI AR-200), to bring the rule into conformity with House Bill 1059 which specifies the duty of an insurer in this regard. Proposed amended §5.9007 adds the requirements for the recording and reporting of any governmental action taken in any state relating to an amusement ride, including an inspection resulting in the repair or replacement of equipment used in the operation of the amusement ride. The section defines governmental action and adopts by reference a governmental action quarterly reporting form. In conformity with House Bill 1059, the amended section also requires, for inspection by law enforcement officials, the maintaining of photocopies of the quarterly reports required by the section for a period of not less than two years at any location where the ride is operated. The amended section further clarifies that the quarterly injury reports must record each injury caused by the amusement ride in any state which injury results in death or requires medical treatment and also revises the quarterly injury report form. It also specifies that an injury is caused by the ride if the injury occurs on the ride or is in any way associated with the ride. Proposed amended §§5.9008 - 5.9010 are updated to conform to the increased fee requirement of House Bill 1059, to reference re-codified statutes and revised forms, and to delete unnecessary language. The department proposes to amend §5.9011 regarding the operator/operational requirements, and the individual standards referenced therein, by setting forth the standardized compliance and standards for an amusement ride covered by the Act that is sold, maintained, or operated in this state. As set forth in House Bill 1059, the standards of the American Society for Testing and Materials are minimum standards in this regard, and to the extent that those standards conflict with the requirements of the Act, the more stringent requirement or standard applies. Proposed amended §5.9012 incorporates the new enforcement provisions of House Bill 1059 regarding entry and inspection of any amusement ride at any time by a municipal, county, or state law enforcement official and also references the duties of an owner/operator of an amusement ride regarding providing documents and cooperating in the prohibiting of operation of an amusement ride. Proposed amended 13 and 5.9014 are updated to conform to the new classification of offense (Class B misdemeanor) for violation of certain sections of the Act or any rule adopted by the commissioner under §§2151.101 through 2151.103 of the Act. Section 5.9014 is also proposed to be amended to reflect the statutory requirement that a prosecuting attorney report to the department a conviction of an offense under §2151.153 of the Act as set forth in the new legislation.

The effective date stated in the proposed amendments for the revised and new forms is May, 2000; however, that date may change depending on the date on which any amendments are adopted. The department has filed a copy of the proposed revised and new forms with the Secretary of State's Texas Register section. Persons desiring copies of the proposed revised and new forms can obtain them from the Office of the Chief Clerk, Texas Department of Insurance, 333 Guadalupe Street, Austin, Texas, 78714-9104. To request copies, please contact Angela Arizpe at 512/322-4147.

Consideration of the proposed amendments will occur in a public hearing under Docket Number 2440 scheduled for 10:00 a.m. on April 12, 2000, in Room 100 of the William P. Hobby, Jr. State Office Building, 333 Guadalupe Street in Austin, Texas.

Alexis Dick, deputy commissioner for the inspections division, has determined that for each year of the first five years that the proposal will be in effect, there will be no fiscal implications for state or local government as a result of enforcing or administering the sections. Ms. Dick has also determined that there will be no adverse effect on local employment or the local economy.

Ms. Dick also has determined that for each year of the first five years that the proposed sections are in effect, the anticipated public benefit from enforcing and administering these sections is improved and more efficient regulation of amusement rides. Additionally, the public will be better protected from hazardous conditions as a result of the adoption and enforcement of requirements for posted signs that inform the public how to report an amusement ride that appears to be unsafe or to report an amusement ride operator who appears to be violating the law. The costs of compliance of the proposed sections to large, small, and micro-businesses results entirely from the legislative enactment of House Bill 1059, 76th Legislature, which mandates that the commissioner adopt rules to implement the legislation, except as noted herein. Additionally, based on the department's research, daily inspections are a routine practice of most amusement ride operations. The cost of compliance with these proposed amendments is the cost to owners and operators of amusement rides to provide the posted signs. Based on inquiries to various sign companies in different parts of the state, the department found that the estimated cost to persons required to comply with the posted sign requirement ranges from $29 to $200 per sign, depending on the type of lettering and durability of the sign. Currently, there are 134 fixed amusement ride parks and approximately 128 traveling shows that contain mobile amusement rides located and operating in Texas which are on file with the department. The total estimated cost of these requirements is dependent on the number of amusement ride operations or the number of ticket locations that will require signs and will be the same cost for all persons and companies, including large, small, and micro-businesses, who engage in the business of operating amusement rides. It is also anticipated that any increases in costs as a result of the proposal will be passed on to consumers and will ultimately be recouped by the amusement ride industry. The cost to persons owning and operating amusement rides who qualify as small or micro-businesses under the Government Code §2006.001 will be the same as the cost to the largest business because the cost is not dependent upon the size of the business but rather is the same price for all persons operating amusement rides. The proposed sections may not be waived for persons owning and operating amusement rides who qualify as small or micro-businesses because the requirements of these sections are prescribed by statute and are further required as a safety measure. It is thus not legal or feasible to exempt small or micro-businesses or to waive compliance considering the purpose of the statute under which the amendments are to be adopted.

To be considered, all comments on the proposal must be submitted in writing no later than 5:00 p.m. on April 10, 2000, to Lynda H. Nesenholtz, General Counsel and Chief Clerk, Texas Department of Insurance, P.O. Box 149104, Mail Code 113-2A, Austin, Texas 78714-9104. An additional copy of the comments must be submitted simultaneously to Alexis Dick, Deputy Commissioner, Inspections Division, Texas Department of Insurance, P.O. Box 149104, Mail Code 103-1A, Austin, Texas 78714-9104.

The amended sections are proposed pursuant to Title 13, Occupations Code, Chapter 2151, and the Insurance Code §36.001. The 76th Legislature enacted House Bill 1059, which amended and added certain sections to Chapter 2151, Title 13, Occupations Code and to the Penal Code which sets forth requirements for amusement rides in this state. Among other things, the legislation specifies new reporting requirements for persons who operate amusement rides and further requires the commissioner to adopt rules requiring operators of mobile amusement rides to perform inspections of mobile amusement rides and rules requiring that a sign be posted to inform the public how to report an amusement ride that appears to be unsafe or to report an amusement ride operator who appears to be violating the law. Insurance Code §36.001 authorizes the Commissioner of Insurance to adopt rules for the conduct and execution of the duties and functions of the Texas Department of Insurance only as authorized by statute.

The following statutes are affected by the proposed sections: Title 13, Occupations Code, Chapter 2151

§5.9001.Purpose and Scope.

It is the purpose of this subchapter to aid in implementing the Amusement Ride Safety Inspection and Insurance Act (hereinafter referred to as the Act). The provisions of this subchapter are in addition to, and not in lieu of, the provisions of the Act (Title 13, Occupations Code, Chapter 2151 [ the Insurance Code, Article 21.60 ]). This subchapter applies to:

(1)

any amusement ride as defined in the Act, §2151.002 [ §2(1) ];

(2)

the owner and operator of any amusement ride;

(3)

any agent or representative of the owner or operator of any amusement ride;

(4)

any insurer, including any surplus lines insurer, as defined in the Insurance Code, Article 1.14-2, and any other nonadmitted company;

(5)

any agent or representative of any insurer, including surplus lines agents, as defined in the Insurance Code, Article 1.14-2, and agents of any nonadmitted company;

(6)

any independently procured policy subject to the Insurance Code, §101.001 et seq. [ Article 1.14-1 ], providing bodily injury liability insurance for amusement rides; and

(7)

any inspector working as an independent contractor [ operator ] or as an employee of an insurance carrier performing amusement ride inspections on behalf of, or under contract with, an insurance carrier.

§5.9002.Definitions.

The following words and terms, when used in this subchapter, shall have the following meanings[ , unless the context clearly indicates otherwise ].

(1)

Act--The Amusement Ride Safety Inspection and Insurance Act (Title 13, Occupations Code, Chapter 2151 [ the Insurance Code, Article 21.60 ]).

(2)

Amusement ride--Any mechanical, gravity, or water device or devices that carry or convey passengers along, around, or over a fixed or restricted route or course or within a defined area for the purpose of giving its passengers amusement, pleasure, or excitement, but such term does not include:

(A)

any coin-operated ride that is manually, mechanically, or electrically operated and customarily placed in a public location and that does not normally require the supervision or services of an operator; or

(B)

nonmechanized playground equipment, including, but not limited to, swings, seesaws, stationary spring-mounted animal features, rider-propelled merry-go-rounds, climbers, playground slides, trampolines, and physical fitness devices.

(3)

ASTM--The American Society for Testing and Materials.

(4)

Class A amusement ride--An amusement ride with a fixed location and designed primarily for use by children 12 years of age or younger.

(5)

Class B amusement ride--Any amusement ride not defined as a Class A amusement ride.

(6)

Commissioner--The Commissioner of Insurance.

(7)

[ (6) ] Inspector--A person qualified by training, education, or experience to conduct safety inspections of amusement rides or devices on behalf of an insurance company and in accordance with the American Society for Testing and Materials (ASTM), the manufacturer's standards and criteria, or standards established by the insurance company.

(8)

[ (7) ] Inspection--A procedure to be conducted by an inspector [ a competent individual ] to determine whether an amusement ride or device is being assembled, maintained, tested, operated, and inspected in accordance with the current ASTM standards [ in effect as of August 26, 1993 ], the manufacturer's, or insurer's standards, whichever is the most stringent, and that determines the current operational safety of the ride or device.

(9)

Mobile amusement ride--An amusement ride that is designed or adapted to be moved from one location to another and is not fixed at a single location.

(10)

Owner/operator--The person or entity responsible for an amusement ride and his or its agents or representatives. A separate reference to owner or operator shall be deemed to include owner/operator.

(11)

[ (8) ] TDI--The Texas Department of Insurance.

§5.9003.Administration and Enforcement.

The Texas Department of Insurance is required by the Act[ , §3, ] to administer and enforce the Act. Owners/operators [ Persons ] operating amusement rides must pay a fee of $40 [ $20 ] per year for each amusement ride subject to the Act. The fee payment shall accompany the insurance policy and amusement ride inspection certificate (TDI Form AR-100, Amusement Ride Certificate of Inspection/Re-Inspection, Revised May, 2000 [ 6/93 ]) required by the Act and by §5.9004 of this title (relating to Amusement Ride Operation Requirements). The fees shall be paid by certified check or money order made payable to the Texas Department of Insurance. The applicant shall attach the certified check or money order to the inspection certificate (TDI Form AR-100, Revised May, 2000 [ 6/93 ]). The certified check or money order may be one check or money order for the total amount of fees for all rides or a separate check for each ride.

§5.9004.Amusement Ride Operation Requirements.

An owner/operator [ A person ] may not operate an amusement ride unless the owner/operator [ such person ] has satisfied and is continuing to satisfy the following requirements.

(1)

The owner/operator [ Such person ] must file with Texas Department of Insurance (TDI) the insurance policy or a photocopy of the insurance policy certifying that the policy is a true copy of the insurance policy provided to the insured as required by the Act, §2151.101 [ §4(a)(2) ]. The Act, §2151.101 [ §4(a)(2) ], requires that any person who operates an amusement ride must have currently in force an insurance policy written by an insurance company authorized to do business in this state or by a surplus lines insurer, as defined by the Insurance Code, Article 1.14-2, or an independently procured policy subject to the Insurance Code, §101.001 et seq . [ Article 1.14-1 ], in an amount of not less than $100,000 per occurrence with a $300,000 annual aggregate for Class A amusement rides and an amount of not less than $1 million per occurrence for Class B amusement rides insuring the owner or operator against liability for injury to persons arising out of the use of the amusement ride. The policy shall apply on a per occurrence basis to bodily injury. Combined single limit policies covering bodily injury and property damage or any other coverage combined with bodily injury will not be acceptable unless the policy specifically provides at least the minimum limits for injury to persons as required by the Act . The following requirements must also be met.

(A)

The policy or certified photocopy of the policy must be complete, including all applicable coverage forms and endorsements. Certificates of insurance will not be acceptable for this purpose.

(B)

The policy must contain a schedule listing by name and serial number if applicable of each amusement ride insured by the policy. In the event of additions or deletions of amusement rides during the policy term, such changes shall be shown on a change endorsement, a copy of which must be submitted to TDI. Additions will also require an inspection certificate (TDI Form AR-100, Amusement Ride Certificate of Inspection/Re-Inspection, Revised May, 2000 [ 6/93 ]) and a $40 [ $20 annual administration ] fee for each amusement ride to be submitted to TDI prior to any operation of the added amusement ride. Additions or deletions shall be filed no later than 10 days after the change.

(C)

In the event of policy cancellation by either the insured owner/operator or the insurance company, the company shall furnish notice of such cancellation to TDI as soon as possible, but not later than 10 days prior to cancellation.

(D)

The owner/operator will provide to any sponsor, lessor, landowner, or other person responsible for an amusement ride offered for use by the public, a photocopy [ copy ] of the inspection certificate and the [ required ] insurance policy required by this section [ limits of coverage and the inspection certificate ].

(E)

If the owner/operator obtains an additional [ a new ] amusement ride device [ from the manufacturer ], the [ new ] ride shall be added to the insurance policy and a copy of the endorsement submitted to TDI along with the required inspection certificate (TDI Form AR-100, Amusement Ride Certificate of Inspection/Re-Inspection, Revised May, 2000) and the $40 fee prior to operation in Texas . [ However, inspection of said ride may be delayed at the discretion of the insurance company until the next cycle of annual inspections are required ].

(2)

The owner/operator [ Such person ] must also file the original amusement ride inspection certificate (TDI Form AR-100, Amusement Ride Certificate of Inspection/Re-Inspection, Rev. May, 2000 [ 6/93 ]) certifying with respect to each amusement ride the matters required by the Act. A separate inspection certificate is required for each amusement ride showing the name, serial number, manufacturer of the ride, the inspector's name, the owner/operator, a picture of the ride in an operable state taken at the time of the inspection, and other information as requested. The serial number and name/description of the amusement ride shall coincide with the same information identified on the insurance policy. If major components of the ride, i.e., the crane used in a bungee operation, are interchangeable , [ ; ] the name, serial number, and manufacturer of the inspected component shall be included on the inspection certificate. The inspection certificate is valid for a period of one year, and for expedience in processing, should if possible coincide with the effective date of the insurance policy. The inspection shall be conducted by the insurer or a person with whom the insurer has contracted. The inspector shall provide both the insurer and owner/operator with a written certificate that the inspection has been made and that the amusement ride meets the standards for coverage.

(A)

The inspection certificate shall not be submitted to TDI [ by the inspector or insurer ] until all discrepancies have been resolved and all necessary repair(s) or replacement(s) required for the amusement ride to meet the standards for coverage have been made.

(B)

The inspection required by §2151.101(a) of the Act must include a method to test the stress- and wear-related damage of critical parts of a ride that the manufacturer of the amusement ride determines are reasonably subject to failure as the result of stress and wear and could cause injury to a member of the general public as a result of a failure. [ The methods to test the stress and wear related damage of critical parts shall be through the use of the manufacturer's checklist/guidelines, ASTM standards in effect as of August 26, 1993, for amusement rides and devices, or the insurer's criteria, whichever is the most stringent. ] The inspection shall include a review of the owner/operator's daily inspection records and inspection and maintenance program in accordance with ASTM practice or the manufacturer's guidelines/inspection criteria. The inspection shall be conducted with the amusement ride or device in an operable state and include an evaluation of the device for a minimum of one complete operating cycle.

(C)

If the amusement ride or device consists of interchangeable major components, such as cranes used in bungee jumping operations, the crane or major component used during the inspection shall be considered an integral part of the amusement ride and the inspection certificate shall include the manufacturer and serial number of the crane or major component inspected with the amusement ride. If the inspected crane or major component is replaced by another unit, a new inspection is required to include the new identification and serial number of the replacement unit.

(D)

Any bungee jumping amusement device shall include a safety net or air bag as an integral part of the ride. The safety net or air bag shall be of sufficient size to cover the jump zone. The safety net or air bag shall be rated for the maximum free fall height possible from the jump platform used. If the jump area is over water, the water must be of sufficient depth to provide an adequate safety cushion. The safety net or air bag shall be inspected as an integral part of the amusement ride.

[ (E)

The inspection certificate shall include a schedule of operating locations and dates for the one year duration of the certificate. If the dates and locations are not known at the time of inspection, this information shall be provided by the owner/operator to TDI, Loss Control Regulation Division, a minimum of 10 days in advance of any public operation. Failure to provide a current location itinerary shall constitute adequate grounds for forfeiture of approval to operate in the state and may subject the owner/operator to enforcement action by the attorney general's office or appropriate local authority on behalf of TDI.]

(E)

[ (F) ] The inspection certificate shall be signed by a representative of the insurer.

(F)

[ (G) ] If the amusement ride or device does not meet the inspection standards, the amusement ride shall not be operated until all necessary repair(s) and/or replacement(s) have been made and the ride reinspected and an inspection /re-inspection certificate issued.

[ (H)

The insurer or safety inspector with whom the insurer has contracted to make the inspection must be professionally qualified to perform the inspection, as set forth in §5.9005 of this title (relating to Qualifications of Personnel Conducting Safety Inspections of Amusement Rides and Devices)].

(G)

[ (I) ] It shall be the responsibility of the amusement ride owner/operator to complete the following prior to any operation of the ride:

(i)

request the insurer to certify that the insurance policy and the inspection certificate are true copies by an official of the insurer;

(ii)

receive the completed policy and inspection certificate from the insurer if they elect to provide coverage;

(iii)

submit a certified copy of the insurance policy, [ and ] the original inspection certificate , and the fee to TDI for review. A planning factor of 10 days should be allowed for TDI review and approval prior to any operation of the ride. Errors of omission or commission on either policy or inspection certificate may delay TDI approval;

(iv)

immediately after any injury or death involving equipment failure, structural failure, or operator error, the amusement ride/device shall be closed for public use until a new inspection is performed and an inspection /re-inspection certificate is submitted to TDI.

(v)

in addition to the requirements of this paragraph, a mobile amusement ride on which a death occurs may not be operated until the requirements of §2151.152 of the Act are met as set forth therein.

(vi)

in addition to the requirements of this paragraph, an amusement ride whose operation has been prohibited by a municipal, county, or state law enforcement official pursuant to §2151.152 of the Act may not be operated until the requirements of that section are met as set forth therein. Any on-site corrections that are made pursuant to the requirements of §2151.152 of the Act must be presented to the appropriate municipal, county, or state law enforcement official.

(H)

[ (J) ] TDI Form AR-100, Amusement Ride Certificate of Inspection/Re-Inspection, Revised May, 2000 [ 6/93 ], is adopted herein by reference and shall be used for each filing of an amusement ride inspection certificate required by this section [ subchapter ]. This form (the Amusement Ride Certificate of Inspection/Re-Inspection [ Inspection Certificate ]) is published by the Texas Department of Insurance and copies of the form may be obtained from the [ Amusement Ride Regulation Section, ] Loss Control Regulation Division, Mail Code 103-9A [ 105-9A ], Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714-9104.

(I)

[ (K) ] The inspection /re-inspection certificate, insurance policy, and [ administration ] fee shall be submitted to TDI, Loss Control Regulation Division, for review. If the inspection /re-inspection certificate and insurance policy meet the requirements of this subchapter, the inspection /re-inspection certificate will be date-stamped and forwarded to the owner/operator with TDI Form AR-101 (Texas Amusement Ride Compliance Sticker), Effective May, 2000 and adopted herein by reference . TDI Form AR-101 will indicate the expiration date of the inspection [ insurance ] certificate and shall be affixed to a major component of the amusement ride in a location visible to the ride participants.

[ (L)

Safety services inspectors from the Loss Control Regulation Division of TDI may inspect any amusement ride at any time for compliance with the Insurance Code, Article 21.60, or this subchapter.]

(J)

The records of the inspections required by this section shall be made available for inspection by any municipal, county, or state law enforcement official at the location at which the amusement ride is operated.

(3)

Renewal of the policy or inspection certificate shall be completed with sufficient lead time to provide these documents to TDI with a minimum of 10 working days to review and approve the documents prior to the expiration of either the policy or the inspection certificate.

(A)

In the event of policy cancellation or expiration, the policy shall promptly be replaced or renewed without any lapse in coverage while the amusement ride is offered for use by the public. Any operation without a valid and current insurance policy and current inspection certificate constitutes an illegal operation and is subject to the enforcement provisions and penalties pursuant to §§2151.151, 2151.152, and 2151.153 of the Act [ issuance of an injunction to cease operation ]. The sponsor, lessor, landowner, or other person responsible for an amusement ride offered for use by the public shall be notified by the owner/operator of the coverage discontinuance.

(B)

A renewal certificate of insurance will be acceptable for the purpose of this paragraph, if the renewal certificate shows:

(i)

insurance coverage against liability for injury to persons arising out of the use of the amusement ride/device;

(ii)

an amount of insurance of not less than $100,000 per bodily injury occurrence with a $300,000 annual aggregate for Class A amusement rides and an amount of insurance of not less than $1 million per bodily injury occurrence for Class B amusement rides; and

(iii)

a policy term that includes the period of time during which the amusement ride will be offered for public use.

(4)

In addition to the inspection required under this section, the owner/operator who operates a mobile amusement ride must perform and record daily inspections of the mobile amusement ride including safety restraints on each mobile amusement ride

(A)

Records of the daily inspections must be available for inspection by any municipal, county, or state law enforcement official at the location at which the amusement ride is operated, and the records must be maintained with the amusement ride for a period of one year.

(B)

The daily inspection record must include an inspection of the following:

(i)

safety belts, bars, locks and other passenger restraints;

(ii)

all automatic and manual safety devices;

(iii)

signal systems, brakes and control devices;

(iv)

safety pins and keys;

(v)

fencing, guards, barricades, stairways and ramps;

(vi)

ride structure and moving parts;

(vii)

tightness of bolts and nuts;

(viii)

blocking, support braces and jackstands;

(ix)

electrical equipment;

(x)

lubrication as per manufacturer's instructions;

(xi)

hydraulic and/or pneumatic equipment;

(xii)

check communication equipment necessary for operation (if applicable);

(xiii)

prior to opening, operate ride through one complete cycle of proper functioning; and

(xiv)

any other component that is included in the manufacturer's specific ride maintenance and safety checks or current ASTM standards, or that the operator or person performing the daily inspection deems necessary for inspection.

(C)

The Texas Department of Insurance (TDI) adopts and incorporates herein by reference TDI Form AR-300 (Daily Inspection Record), Effective May, 2000. This form is published by TDI and copies of the form may be obtained from the Loss Control Regulation Division, Mail Code 103-9A, Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714-9104. This form sets forth the inspection requirements of this subsection and also includes the name of the device, location (city, state), date of the inspection, manufacturer and serial number, and owner/operator. The form must be signed by the person performing the daily inspection and his supervisor.

(D)

Daily inspection record forms used by industry associations, individual operators, or individual manufacturers may be used to fulfill the requirements of this paragraph if the forms contain all of the inspection items and elements set forth in this paragraph and the TDI Form AR-300 (Daily Inspection Record).

(E)

In addition to the requirements of this subsection, the owner/operator who operates a mobile amusement ride must also follow the manufacturer's specific checklist for specific ride maintenance and safety checks.

(5)

In addition to the inspection requirements of this section, TDI Form AR-102, Amusement Ride Schedule of Operations in Texas, Effective May, 2000, is adopted herein by reference and shall include a schedule of operating locations and dates for each six-month period for mobile operations. This information shall be provided by the owner/operator to TDI, Loss Control Regulation Division, Mail Code 103-9A, Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714-9104, a minimum of 10 days in advance of each six-month period. Any changes in the schedule must be submitted on an amended TDI Form AR-102 to TDI by the owner/operator within 10 days of such change.

§5.9005.[ Qualifications of ] Personnel Conducting Safety Inspections of Amusement Rides and Devices.

[ (a) ]

To conduct required safety inspections on amusement rides and devices in accordance with the Act, the insurer must [ may ] employ [ qualified ] inspectors, retain inspectors who are [ qualified ] independent contractors, or contract with the insured to have the amusement ride or device inspected by an [ a qualified ] inspector. [ If the inspector does not have personal qualifications on record with Texas Department of Insurance (TDI) through the procedures established in §5.9006 of this title (relating to Designation of Safety Inspector for Amusement Rides and Devices), the insurer shall provide on request of TDI, the qualifications of the person or persons conducting the inspection. At the discretion of TDI, this qualification shall be provided to TDI prior to public operation of the amusement ride or device. To be qualified to conduct safety inspections on amusement rides or devices in Texas, an individual shall obtain a minimum of 10 points using the criteria described in paragraphs (1)-(3) of this subsection. ]

[ (1)

Education. Two points may be considered for each year of college education in science or engineering. A maximum of four points may be accrued through education.]

[ (2)

Training. One point may be considered for each major amusement ride inspection/maintenance school attended or one point accrued for each five hours of continuing education credit (CEU) in a recognized and approved course of training in amusement ride safety and inspections. A maximum of six points may be accrued through training.]

[ (3)

Experience. Two points may be considered for each year of experience in amusement ride safety, maintenance, or inspections. A maximum of six points may be accrued through experience. Credits for experience must be documented sufficiently for verification by TDI.]

[ (b)

In addition to the criteria submitted under subsection (a)(1)-(3) of this section, additional criteria of instructor experience, extensive inspection or education experience, letters of credit, or participation in formal trade association activities may be submitted for review by TDI.]

Public Information Sign. [ Designation of Safety Inspector for Amusement Rides and Devices. ]

An owner/operator who operates an amusement ride in this state shall post a sign to inform the public how to report an amusement ride that appears to be unsafe or to report an amusement ride operator who appears to be violating the law.

(1)

The sign must be 20 inches in width and 30 inches in length and must be in at least 50-point, all capital block letters, bold-faced red-on-white-background type and must be readable from a distance of 25 feet.

(2)

The sign must be printed in both English and Spanish.

(3)

The sign must be posted at the principal entrance(s) to the site at which an amusement ride is located or at any location on that site at which tickets for an amusement ride are available.

(4)

The sign must state the following:

Figure: 28 TAC §5.9006(4)

[ The designation as safety inspector for amusement rides and devices may be made by Texas Department of Insurance (TDI) and is based on the qualifications in §5.9005 of this title (relating to Qualifications of Personnel Conducting Safety Inspections of Amusement Rides and Devices). To be designated as a safety inspector for amusement rides and devices, a candidate must obtain an application form titled "Qualification Review for Inspectors of Carnival--Amusement Rides and Devices." The application form must be completed and returned with appropriate documentation of education, training, and experience to the director for review of qualifications. The application form is adopted by the board by reference and is published by TDI. Copies of the application form may be obtained from the Director of Loss Control Regulation, Mail Code 105-9A, Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714-9104. ]

§5.9007.Quarterly [ Injury ] Reports.

(a)

An owner/operator [ A person ] who operates an amusement ride (the operator) shall maintain accurate records of each injury caused by the ride in any state which injury results in death or requires medical treatment. An injury is caused by the ride if the injury occurs on the ride or is in any way associated with the ride.

(1)

The Texas Department of Insurance (TDI) adopts and incorporates herein by reference TDI Form AR-800 (Quarterly Injury Report) Revised May, 2000 . This form is published by TDI and copies of the form may be obtained from the Loss Control Regulation Division, Mail Code 103-9A [ 105-9A ], Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714-9104. The operator shall file an injury report on TDI Form AR-800 with TDI on a quarterly basis and shall include in the report a description of each verifiable injury caused by a ride that results in death or injury that requires medical treatment.

(2)

For purposes of this section, the term "medical treatment" includes treatment (other than first aid) administered by a physician or by registered professional personnel under the standing orders of a physician.

(3)

For purposes of this section, the term "medical treatment" does not include first-aid treatment (one-time treatment and subsequent observation of minor scratches, cuts, burns, splinters, and any other minor injuries that do not ordinarily require medical care) even though treatment is provided by a physician or by registered professional personnel.

(4)

The quarterly injury report is not required of the operator for any quarter in which no reportable injury occurs in any state .

(b)

An owner/operator who operates an amusement ride (the operator) shall maintain accurate records of any governmental action taken in any state relating to that particular amusement ride, including an inspection resulting in the repair or replacement of equipment used in the operation of the amusement ride.

(1)

TDI adopts and incorporates herein by reference TDI Form AR-801 (Quarterly Governmental Action Report) Effective May, 2000. This form is published by TDI and copies of the form may be obtained from the Loss Control Regulation Division, Mail Code 103-9A, Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714-9104. The operator shall file a governmental action report on TDI Form AR-801 with TDI on a quarterly basis and shall include in the report a description of each governmental action taken in any state during the quarter covered by the report relating to that particular amusement ride, including an inspection resulting in the repair or replacement of equipment used in the operation of the amusement ride.

(2)

For purposes of this section, the term "governmental action" includes an action in the exercise of police power or in the exercise of constitutional, legislative, administrative, or judicial powers conferred on federal, state or local government, which results in any notification to the owner/operator relating to the amusement ride, including notifications of any perceived deficiencies regarding the safety of the amusement ride or the possibility of actual or imminent non-compliance with applicable laws; or any action taken in an administrative law forum or court of law, including private civil lawsuits.

(3)

The quarterly governmental action report is not required of the operator for any quarter in which no reportable governmental action was taken in any state.

(c)

An owner/operator who operates an amusement ride (the operator) shall maintain for not less than two years at the location where the ride is operated, for inspection by a municipal, county, or state law enforcement official, a photocopy of any quarterly report required under subsection (a) or (b) of this section to be filed with the commissioner.

§5.9008.Filing Affidavit.

In addition to the requirements of the Act, §2151.101(b) [ §5 ], the following requirements apply.

(1)

In the event a contract for use of an amusement ride provides that the amusement ride will not be operated until after July 1 but prior to December 31 of any year, then timely filing of the insurance policy and inspection certificate shall be made with Texas Department of Insurance (TDI) prior to the operation of the amusement ride. In no event may an amusement ride be operated before the inspection certificate, insurance policy, and fee [ policy ] are submitted to TDI as required by §5.9004 of this title (relating to Amusement Ride Operation Requirements).

(2)

If the amusement ride is inspected more than once a year due to the requirements of this subchapter, a supplemental inspection certificate (TDI Form AR-100 , Amusement Ride Certificate of Inspection/Re-Inspection, Rev. May, 2000 [ 6/93 ]) must be submitted to TDI not later than 15 days after each subsequent inspection. An additional annual $40 [ $20 administration ] fee is not required for supplemental inspection certificates.

§5.9009.Information Request.

The Texas Department of Insurance (TDI) may request, from the owner/operator, sponsor, lessor, landowner, or other person responsible for an amusement ride offered for use by the public, information concerning whether or not insurance in the amount required by Title 13, Occupations Code, Chapter 2151 [ the Insurance Code, Article 21.60 ], or this subchapter is in effect on the amusement ride. The owner/operator, sponsor, lessor, landowner, or other person to whom the information request is made shall respond to TDI within 15 days after the request is made. The response must be by written verification. For the purpose of verification, the written response shall include a copy of the declarations page of the policy insuring the amusement ride owner or operator.

§5.9010.Confirmation of Required Insurance and Inspection Certificate; Rule Construction.

(a)

After the required insurance policy and inspection certificate, including certified check or money order for the total amount of annual [ administration ] fee have been received by the Texas Department of Insurance (TDI) and found to be in compliance with the Act and this subchapter, the original amusement ride inspection certificate (TDI Form AR-100, Amusement Ride Certificate of Inspection/Re-Inspection, Rev. May, 2000 [ 6/93 ]) will be stamped "Texas Department of Insurance Amusement Ride Program," will include the date of approval and will be returned to the insured owner or operator as evidence of compliance with filing requirements. The returned inspection certificate must be kept on the premises at which the amusement ride is offered for public use and made available to any person granted authority under the Act to investigate compliance with the Act. A TDI Form AR-101 , (Texas Amusement Ride Compliance Sticker), Effective May, 2000, will be returned with each inspection certificate. This weatherproof form shall be affixed to the appropriate ride or device in a place easily visible to all ride participants.

(b)

If the required insurance policy, inspection certificate, and/or annual [ administration ] fee is found not to be in compliance with the Act, this subchapter, or other applicable law, notice will be provided to the insured owner or operator or their insurer by TDI indicating the necessary action(s) for compliance. [ If a response to compliance is not received within 10 days and the amusement ride/device is continuing to be used by the public, the attorney general's office will be notified for appropriate action. ] If noncompliance is due to mechanical problems or failure to meet insurance standards, another TDI Form AR-100 , Amusement Ride Certificate of Inspection/Re-Inspection, Rev. May, 2000 [ 6/93 ] shall be submitted to TDI for approval after the necessary corrective action(s) or repair(s) have been completed by the owner or operator. After the necessary actions have been completed by the owner/operator to the satisfaction of TDI, TDI Form AR-100, Rev. May, 2000 [ 6/93 ] will be stamped and mailed to the insured owner or operator as described in subsection (a) of this section.

(c)

Nothing in this subchapter may be construed to authorize the operation of an amusement ride until all applicable requirements of law are met.

Standards and Compliance. [ Operator/Operational Requirements. ]

An amusement ride covered by the Act that is sold, maintained, or operated in this state shall comply with current standards established by the American Society for Testing and Materials (ASTM). Those standards are minimum standards. To the extent that the standards of the American Society for Testing and Materials conflict with the requirements of the Act, the more stringent requirement or standard applies.

[ (a)

The ride operator shall be a competent and trained operator of sufficient age and maturity.]

[ (b)

The ride operator shall operate no more than one amusement ride, device, or attraction at any given time, even if automatic timing devices are used to control the time cycle of the ride.]

[ (c)

The ride operator shall be trained in the proper use and operation of the ride/device as provided for in ASTM F770-88 and ASTM F853-91.]

[ (d)

The ride operator shall ensure that all passenger safety devices are in place around ride participants before starting the ride/device.]

[ (e)

The ride operator shall be within arm's length of the operating controls when the ride or device is in motion.]

[ (f)

The ride operator shall not operate any ride or device while under the influence of alcohol, drugs, or medicines that will affect his/her performance.]

[ (g)

The operator shall ensure that no one is permitted on a ride while carrying any article, i.e., food, beverages, packages, lighted cigarettes, etc., which could endanger the rider, other patrons, or spectators.]

[ (h)

Adequate fencing or barriers must be provided for the protection of spectators and riders from the action of the ride or device and its associated power units. In the case of aerial rides or swings, these barriers must provide a safe distance from the outermost arc of such swing or aerial ride.]

[ (i)

Any amusement ride or device or its power unit shall be so located to prevent a fire hazard to adjacent buildings, exhibits, structures, other amusement rides or devices. In the case of rides or devices using gasoline engines, storage of gasoline must be in approved safety containers, and so located to prevent a safety hazard. Gasoline engines shall be so located to have adequate ventilation for exhaust and fumes ventilation.]

[ (j)

All electrical wires leading to and from a ride or device shall be protected and insulated to prevent shock hazard. All electrical equipment shall be properly grounded with ground fault circuit interrupters if warranted. All electrical junction boxes shall be properly identified as such and be locked or sealed against public access. All wiring shall conform to manufacturer's and electrical code practices.]

[ (k)

Any ride or device requiring patron restraint shall be equipped with lap bars, seat belts, roll bars, shoulder straps, or other safety restraints as appropriate. Height and weight, age, or health restrictions may be required on any ride or device by the inspector or the ride owner/operator.]

[ (l)

A suitable fire extinguisher meeting the standards of state fire officials shall be present on or nearby every ride or device and must be properly charged and operable at all times. Water rides that present no fire hazard will not require a fire extinguisher.]

§5.9012.Denial of Entry to Amusement Rides ; Prohibiting Operation of Amusement Rides.

(a)

The owner/operator of an amusement ride or device shall have the ability to view patrons so that no one is permitted on such ride or device who appears to be in an intoxicated, drugged, or other condition of health that could be detrimental to the safety of themselves, other patrons, the operator, or spectators.

(b)

The owner/operator shall exercise reasonable control to prohibit the wearing of improper attire or lack of attire as deemed appropriate for the ride or device.

(c)

The owner/operator will prohibit the carrying of any article which might be dropped or thrown from the ride or device.

(d)

The restrictions set forth in this section and others that will preclude participation on an amusement ride or device shall be posted in plain view at the entrance to the ride. No operator may waive such restrictions.

(e)

A municipal, county, or state law enforcement official may enter and inspect without notice any amusement ride at any time to ensure public safety, and the owner/operator of an amusement ride must comply with the requirements of §2151.152 of the Act, including providing copies of the inspection certificate and insurance policy and cooperating in the prohibiting of the operation of the amusement ride, if applicable.

(f)

A municipal, county, or state law enforcement official may immediately prohibit operation of an amusement ride as set forth in §2151.152 of the Act, and a person may not operate the amusement ride until the requirements of §2151.152 of the Act are met as set forth therein.

§5.9013.Injunctions.

Any person who operates an amusement ride, amusement attraction, or amusement device, and offers such for the public, must meet the requirements of the Texas Amusement Ride Safety Inspection and Insurance Act. Failure to comply or violations of the Act constitute a Class B [ C ] misdemeanor. Each day of public operation shall constitute a separate and distinct offense. The district attorney of each county in which an amusement ride or device is operated or, on request of the commissioner of insurance, the state attorney general, or one of his/her agents may seek an injunction against any person operating an amusement ride or device in violation of the Act or in violation of [ and ] this subchapter.

§5.9014.Penalties; [ Local ] Enforcement.

(a)

An amusement ride owner/operator commits an offense if he/she fails to comply with any requirement under §5.9004 of this title (relating to Amusement Ride Operation Requirements) , §5.9006 of this title (relating to Public Information Sign), §5.9007 of this title (relating to Quarterly Reports), or §5.9008 of this title (relating to Filing Affidavit). An owner/operator, [ A ] sponsor, lessor, landowner, or other person responsible for an amusement ride offered for use by the public commits an offense if he/she fails to provide information required by this subchapter or provides false information under §5.9004(a)(2) (G) [ (I) ]. Any offense under this subchapter is considered a Class B [ C ] misdemeanor. Each time a violation of this subchapter is committed constitutes a separate offense.

(b)

In addition to action by the state attorney general, local municipal, [ or ] county , or state law enforcement officials may be solicited to determine compliance with this subchapter or with §§2151.101 through 2151.103 of the Act in conjunction with Texas Department of Insurance, and may institute an action in a court of competent jurisdiction to enforce Title 13, Occupations Code, Chapter 2151 [ the Insurance Code, Article 21.60 ], and this subchapter.

(c)

The prosecuting attorney in a case in which a person is convicted of an offense under §2151.153 of the Act shall report the offense to TDI not later than the 90th day after the date of the conviction.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on February 28, 2000.

TRD-200001495

Lynda Nesenholtz

General Counsel and Chief Clerk

Texas Department of Insurance

Earliest possible date of adoption: April 9, 2000

For further information, please call: (512) 463-6327

Chapter 103. AGENCY ADMINISTRATION

Subchapter A. EMPLOYEE TRAINING AND EDUCATION PROGRAM

28 TAC §103.100

The Texas Workers' Compensation Commission (the Commission) proposes new §103.100, concerning historically underutilized businesses is proposed to comply with Texas Government Code, §2161.003, which requires state agencies to adopt the rules of the General Services Commission (GSC) relating to the Historically Underutilized Business (HUB) Certification Program.

The Texas Register published text shows the text of the new rule, and should be read to determine all proposed text.

Proposed new §103.100 adopts by reference the rules of the Texas General Services Commission located in Title 1 Texas Administrative Code, §§111.11 - 111.24, relating to the historically underutilized business certification program and promotes full and equal business opportunity for all businesses in state contracting. The Commission has already been complying with GSC's HUB rules. Certification of a business as a HUB will continue to be done by the GSC.

Victor Rodriguez, Finance Manager, has determined that for the first five-year period the proposed rule is in effect there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule because the General Services Commission rules being adopted by reference are already followed by the Commission. Administering and enforcing proposed §103.100 will affect only the Texas Workers' Compensation Commission because it relates only to contracting by the Commission.

Mr. Rodriguez has also determined that for each year of the first five years the rule as proposed is in effect the public benefits anticipated as a result of enforcing the rule will be the encouragement by the Commission of the use of historically underutilized businesses when procuring goods and services through race, ethnic, and gender neutral means.

There will be no anticipated economic costs to persons who are required to comply with the rule as proposed because there is no charge for certification as a HUB by the GSC, and because this rule merely states that the Commission will comply with GSC's rules, which it has already been doing. For these same reasons, there will be no adverse economic impact on small businesses or micro-businesses and. There will be no difference in the cost of compliance for small businesses and micro-businesses as compared to large businesses.

Comments on the proposal must be received by 5:00 p.m., April 10, 2000. You may comment via the Internet by accessing the Commission's website at http://www.twcc.state.tx.us and then clicking on "Proposed Rules." This medium for commenting will help you organize your comments by rule chapter. You may also comment by emailing your comments to or by mailing or delivering your comments to Donna Davila at the Office of the General Counsel, Mailstop #4-D, Texas Workers' Compensation Commission, Southfield Building, 4000 South IH-35, Austin, Texas 78704-7491. Based upon various considerations, including comments received and the staff's or commissioners' review of those comments, or based upon action by the commissioners at the public meeting, the rule(s) as adopted may be revised from the rule(s) as proposed in whole or in part. Persons in support of the rule(s) as proposed, in whole or in part, may wish to comment to that effect.

This proposed new rule affects the following statutes: the Texas Labor Code, §402.061, which authorizes the Commission to adopt rules necessary to administer the Act, the Texas Government Code, Chapter 2161, which sets out the implementation procedures for the historically underutilized business program and specifically §2161.003, which requires state agencies to adopt the rules of the General Services Commission relating to the Historically Underutilized Business Certification Program.

The new rule is proposed under the Texas Labor Code, §402.061, which authorizes the Commission to adopt rules necessary to administer the Act, the Texas Government Code, Chapter 2161, which sets out the implementation procedures for the historically underutilized business program and specifically §2161.003, which requires state agencies to adopt the rules of the General Services Commission relating to the Historically Underutilized Business Certification Program.

§103.100.Historically Underutilized Businesses

(a)

The Commission adopts by reference the rules of the Texas General Services Commission in 1 Texas Administrative Code §§111.11 - 111.24 (relating to Historically Underutilized Business Certification Program). Certification of a business as a historically underutilized business remains the responsibility of the General Services Commission.

(b)

The adoption of this rule is required by Texas Government Code, §2161.003 (as added by the 76th Legislature, effective September 1, 1999).

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on February 22, 2000.

TRD-200001302

Susan Cory

General Counsel

Texas Workers' Compensation Commission

Earliest possible date of adoption: April 9, 2000

For further information, please call: (512) 804-4287

28 TAC §129.5

The Texas Workers' Compensation Commission (the Commission) proposes an amendment to §129.5 concerning Work Status Reports.

Since adopting current §129.5 in December of 1999, the Commission has received numerous questions and significant feedback about the requirements of the rule. In an effort to resolve some of the concerns that have been raised and clarify the rule, the Commission proposes several amendments. The amendments, if adopted, will: clarify the report filing duties; extend the period of time that doctors have to file the report with insurance carriers (carriers) and employers; and provide doctors reimbursement for filing the report. It is expected that together, these changes will help ensure reports are timely filed which in turn will improve benefit delivery, reduce disputes, make dispute resolution easier due to increased availability of information, and increase compliance.

The Texas Register published text shows words proposed to be added to or deleted from the current text, and should be read to determine all proposed changes.

Proposed Amendments to Subsection (a).

Subsection (a) is proposed to be amended to clarify who is required to file the Work Status Report under this rule. The current language states that in addition to a treating doctor, "a doctor to whom the treating doctor has referred the injured employee (employee) for regular treatment" is required to file the report under this rule. Questions have arisen as to what is meant by "regular treatment."

The intent of the current language was to address the situation in which the treating doctor has referred the employee to another doctor to provide treatment. Often, this will result in this other doctor becoming the primary provider of care for the employee for a period of time during the claim. Therefore, it was expected that this doctor would be in the best position to address the employee's current work status.

At the time the current rule was adopted, the Commission rules did not contain a definition of a referral doctor. Therefore, the current language was an attempt to explain the concept of referral doctor until a definition was adopted. Section 133.4 of this title (concerning Consulting and Referral Doctors) is adopted concurrently with the proposal of these amendments. With the adoption of §133.4, it is proposed that the explanation of referral doctor be replaced with a reference to the definition of "referral doctor" in new §133.4 to clarify the concept.

Proposed Amendments to Subsection (e).

Subsection (e) is proposed to be amended to extend the period of time that doctors have to file the report with employers and carriers. It was noted that, particularly at the beginning of a claim, the doctor may not be able to obtain carrier information within one working day of the initial examination as is currently required. Therefore, the timeframe was extended to provide more time for the doctor to obtain the necessary information. The requirement that the doctor provide the employee with a copy of the Work Status Report at the time of the examination has not been changed in the proposal. Even if the carrier and/or employer information is not available at the time of the examination, the completed Work Status Report absent that information can easily be provided to the employee at that time. The form instructions will state that the employee's copy given at the end of the examination is not required to contain the carrier and/or employer information when it is provided. In developing the proposed amendment, the idea of extending the filing period for the initial report but leaving the period intact for subsequent reports was considered and rejected. Although it is true that once the provider has obtained the carrier information, less time should be needed to file the report, there was concern that having two different deadlines would be confusing. Further, at this time, most of these reports will be filed by facsimile rather than electronic transmission. It may be some time before carriers have had the opportunity to identify the full effect that increased reporting by facsimile will have on their available facsimile capacity and to adjust that capacity as necessary. This also suggests that increasing the period of time for both initial and subsequent reports is appropriate at this time.

Proposed New Subsection (i).

New subsection (i) is proposed to provide the doctor with reimbursement for filing a report required by this rule. If adopted, doctors will not be entitled to reimbursement for reports which are not required by the rule unless they are provided in response to a request from the carrier. Reports in excess of those required by the rule or requested by the carrier will not be reimbursed.

In the preamble to the adoption of current §129.5, the Commission indicated that the Work Status Report would not be separately reimbursed. However, the Commission has reconsidered reimbursement for completion and submission of the Work Status Report and is now proposing that reimbursement be included in the rule.

The Work Status Report is a new report and there will be a time period, (before the repeal of the TWCC-61, and TWCC-64 forms becomes effective) during which the Work Status Report is required in addition to those reports. Reimbursement will assist in any program management changes that are required.

The successful implementation of this new reporting mechanism will help ensure that benefits are timely initiated and terminated and help reduce system costs by increasing communication between carriers, employers, and employees regarding return to work opportunities. Providing reimbursement for what should be valuable information will provide an additional incentive for filing the report as required and, as a result, benefit the system as a whole.

The Commission is currently in the process of obtaining additional input and amending the Work Status Report form to make it easier to use; however, in the meantime, the Work Status Report form currently in effect should be used.

Reimbursement for completion and submission of the Work Status Report is proposed to be set at $15 because this is consistent with reimbursement for other required reports. The Commission has received suggestions that the report be reimbursed at a significantly higher level than other reports traditionally have been. Some of the reasons that these suggestions have been made were due to the mistaken belief that the reporting on the employee's work status will require a more thorough examination, possibly even a functional capacity examination. Work status reporting is designed to be based upon the doctor's experience and judgment and does not require the kind of testing that functional capacity and impairment rating examinations do. Work status reporting is intended to improve communication and ensure that return to work remains an issue at the forefront of a workers' compensation claim. More involved examinations are only expected to be needed on more serious injuries, particularly those in which the employee has been off of work a very long period of time.

Victor Rodriguez, Chief Financial Officer, has determined that for the first five-year period the proposed rules are in effect there will be fiscal implications for state government as a result of enforcing or administering the rules. The Commission should see a number of benefits if the proposed amendments are adopted. The information provided in the Work Status Report should result in reduction in costs by helping reduce the number of dispute resolution proceedings and simplifying dispute resolution by providing better information. Customer service costs for the Commission should also be reduced because some of the confusing areas in the existing rule will be clarified. Also, it will be easier to hold system participants accountable for their actions or inactions because the requirements of the law and rules will be clarified. The amount of reduction in costs resulting from the enforcement or administration of the proposed rule cannot be quantified. Local governments will not be enforcing or administering this rule.

Local government and state government as covered regulated entities will be impacted in the same manner as described later in this preamble for persons required to comply with the rule as proposed.

Mr. Rodriguez has also determined that for each year of the first five years the rules as proposed are in effect, the public benefits anticipated as a result of enforcing the rule are as follows:

The changes in the rule should ensure that more of the required reports are filed which should help increase the employee's opportunities for a speedy return to work and thus may have a positive impact on the employee's long term earning potentials.

Health care providers should benefit from the amendments because it is clearer who has to file the report, because the period of time to file the report has been extended, and because they will receive compensation for filing the report. Further, increased compliance with the rule should allow providers to benefit from having to deal with fewer calls from carriers attempting to obtain disability status information.

Carriers should benefit from the amendments because, taken together, they should increase compliance with the rule. As a result, the timely provision of disability information from the treating or referral doctor should significantly improve the carrier's ability to monitor their claims and ensure that benefits are timely started and terminated. Further, to the extent that employees safely return to work earlier in their claims as is intended, claim costs should be reduced both in terms of benefits paid and administrative costs.

Mr. Rodriguez has also determined that for each year of the first five years the rule as proposed is in effect, the requirements to comply with the rule will have the following effects on costs of system participants:

Health care providers should see a reduction in costs associated with reduced calls from carriers attempting to obtain information regarding an employee's disability status and expected return to work. In addition, providers should benefit from the reimbursement of the report.

There will be no anticipated adverse economic impact on small businesses or micro-businesses. The requirements of these rules should affect costs for small businesses as described above. There will be no difference in the cost of compliance for small and micro-businesses as compared to large businesses

Comments on the proposal must be received by 5:00 p.m., April 10, 2000. You may comment via the Internet by accessing the Commission's website at http://www.twcc.state.tx.us and then clicking on "Proposed Rules." This venue for commenting will help you organize your comments by rule chapter. You may also comment by emailing your comments to RuleComments@twcc.state.tx.us or by mailing or delivering your comments to Donna Davila at the Office of the General Counsel, Mailstop #4-D, Texas Workers' Compensation Commission, Southfield Building, 4000 South IH-35, Austin, Texas 78704-7491.

Commentors are requested to clearly identify by number the specific rule and paragraph commented upon. The Commission may not be able to respond to comments which cannot be linked to a particular proposed rule. Along with your comment, it is suggested that the reasoning for the comment also be included for Commission staff to fully evaluate your recommendations.

Based upon various considerations, including comments received and the staff's or commissioners' review of those comments, or based upon action by the commissioners at the public meeting, the rule as adopted may be revised from the rule as proposed in whole or in part. Persons in support of the rule as proposed, in whole or in part, may wish to comment to that effect.

A public hearing on this proposal is scheduled for April 18, 2000, at the Austin central office of the Commission (Southfield Building, 4000 South IH-35, Austin, Texas). Those persons interested in attending the public hearing should contact the Commission's Office of Executive Communication at (512) 804-4435 to confirm the date, time, and location of the public hearing for this proposal. The public hearing schedule will also be available on the Commission's website at http://www.twcc.state.tx.us.

The amendment is proposed under following statutes: Texas Labor Code, §401.024 as amended by the 76th Texas Legislature, which provides the Commission the authority to require use of facsimile or other electronic means to transmit information in the system; Texas Labor Code, §402.042, which authorizes the Executive Director to enter orders as authorized by the statute as well as to prescribe the form manner and procedure for transmission of information to the Commission; Texas Labor Code, §402.061, which authorizes the Commission to adopt rules necessary to administer the Act; Texas Labor Code, §406.010, which authorizes the Commission to adopt rules regarding claims service; Texas Labor Code, §408.004, which addresses required medical examinations and the affect of a carrier selected doctor's opinion of payment of TIBs; and Texas Labor Code, §413.018, as amended by the 76th Texas Legislature, which requires the Commission develop a program to encourage employers and treating doctors to communicate about modified duty offers.

These proposed amendments affect the following statutes: Texas Labor Code, §401.024 as amended by the 76th Texas Legislature, which provides the Commission the authority to require use of facsimile or other electronic means to transmit information in the system; Texas Labor Code, §402.042, which authorizes the Executive Director to enter orders as authorized by the statute as well as to prescribe the form manner and procedure for transmission of information to the Commission; Texas Labor Code, §402.061, which authorizes the Commission to adopt rules necessary to administer the Act; Texas Labor Code, §406.010, which authorizes the Commission to adopt rules regarding claims service; Texas Labor Code, §408.004, which addresses required medical examinations and the affect of a carrier selected doctor's opinion of payment of TIBs; and Texas Labor Code, §413.018, as amended by the 76th Texas Legislature, which requires the Commission develop a program to encourage employers and treating doctors to communicate about modified duty offers.

§129.5.Work Status Reports

(a)

As used in this section:

(1)

the term "doctor" means either the treating doctor or a referral doctor , as defined by §133.4 of this title (relating to Consulting and Referral Doctors) [ to whom the treating doctor has referred the injured employee (employee) for regular treatment ]; and

(2)

the term "work status" refers to whether the injured employee's (employee) medical condition will:

(A)

allow the employee to return to work without restrictions;

(B)

allow the employee to a return to work with restrictions; or

(C)

restricts the employee from returning to work.

(b)-(d)

(No change.)

(e)

The initial Work Status Report shall be filed with the insurance carrier (carrier) , employer, and employee. Subsequent Work Status Reports shall be filed with the carrier and employee and, if the employee's work status has changed, filed with the employer as well. The report shall be provided to the employee at the time of the examination and shall be sent not later than the end of the second working day after [ within one working day from ] the date of examination to the carrier, and if applicable, the employer.

(f)-(g)

(No change.)

(h)

The doctor shall file the Work Status Report with the [ insurance ] carrier by facsimile or electronic transmission. The doctor shall file the report with the employer by facsimile or electronic transmission if the doctor has been provided the employer's facsimile number or email address; otherwise, the report shall be filed by personal delivery or mail.

(i)

Notwithstanding any other provision of this title, a doctor may bill and a carrier shall reimburse a report required under this section in the amount of $15. A doctor shall not bill in excess of $15 and shall not bill or be entitled to reimbursement for a Work Status Report which is not required by this section, unless it is provided at the request of the carrier, in which case the reimbursement shall also be $15.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on February 22, 2000.

TRD-200001300

Susan Cory

General Counsel

Texas Workers' Compensation Commission

Earliest possible date of adoption: April 9, 2000

For further information, please call: (512) 804-4287