TITLE 16.ECONOMIC REGULATION

Part 1. RAILROAD COMMISSION OF TEXAS

Chapter 15. ALTERNATIVE FUELS RESEARCH AND EDUCATION DIVISION

The Railroad Commission of Texas proposes amendments to certain sections of 16 TAC Chapter 15 relating to the Alternative Fuels Research and Education Division. Amendments are proposed in Subchapter A to §§15.5, 15.30, 15.41, 15.45, 15.55, 15.60, 15.65, 15.70, 15.90, 15.95, and 15.100, relating to AFRED Forms; Propane Alternative Fuels Advisory Committee; Definitions; Registration of Odorizers, Odorizer Agents, and Importers; Report and Remittance of Fees; Exemptions; Odorizer or Importer Refunds; Commission Refund; Power of Entry; Audits and Investigations; Procedure for Compliance with or Challenge to Audit Results; and Interpretation and Application; in Subchapter B to §§15.105, 15.110, 15.120, and 15.160, relating to Definitions; Establishment; Duration; Eligibility; and Complaints; in Subchapter C to §§15.205, 15.210, and 15.220, relating to Definitions; Establishment; Duration; and Application; in Subchapter D to §§15.305 and 15.310, relating to Definitions; and Establishment; Duration; Operation; and in Subchapter E to §§15.405, 15.420, 15.425, 15.430, and 15.445, relating to Definitions; Eligibility; Application Procedure; Payment of Incentive; and Complaints. These amendments are proposed to simplify and clarify administration of the division's programs and to reflect nonsubstantive changes, e.g., the addresses and titles of commission administrative units.

AFRED Forms; Propane Alternative Fuels Advisory Committee

The proposed amendment to §15.5 would change the title of AFRED Form 6A consistent with proposed amendments to §15.41 and §15.45.

Proposed amendments to §15.30 would delete references to performing propane-related research services or other services from the definitions of "consumer representative" and "industry representative." The changes would require that to qualify as an industry representative a member of the committee must be a propane marketer, propane supplier or propane equipment manufacturer. The commission finds that propane researchers are normally employed by universities, private nonprofit research organizations or government agencies and are outside the propane industry proper. The definition of "subcommittee" in subsection (a), the corresponding language in subsection (i), and references in subsections (j) and (k) are proposed to be deleted as obsolete, since in recent years the committee has chosen to conduct all its business in plenary session as a committee of the whole. In subsection (b), the commission proposes a new sunset date for the committee of October 31, 2006.

In §15.41, the commission proposes to redefine "importer" so that the term includes a supplier who has been designated as the agent of an importer on AFRED Form 6A, consistent with the proposed amendments to §15.45 described below. In §15.41(12), a citation to another commission rule has been updated.

Proposed amendments to §15.45 would make importers as well as odorizers eligible to enter into voluntary agency agreements with suppliers for the purposes of administering LPG delivery fees. The new language sets out the requirements and procedures for entering into such agreements and clarifies the duties of importers and importer agents. This change is proposed to minimize administrative cost to the industry by permitting a supplier to collect and remit LPG delivery fees as agent for an importer at a storage or terminal facility if the importer and supplier execute and file with the commission AFRED Form 6A, to make the supplier legally responsible for performing the importer's duties related to administration of delivery fees under Texas Natural Resources Code, §§113.241-113.250, inclusive. If no AFRED Form 6A is on file with the commission, any person who imports odorized LPG is responsible for registering annually as an importer and for collecting and remitting fees to the commission on all nonexempt loads the person imports.

The commission's intention in permitting this choice is to minimize administrative costs to the industry, by allowing suppliers and storage or terminal operators to extend to importers the agency option currently available to odorizers under §15.45 in cases where such arrangements are cost- effective and appropriate, while fully implementing all pertinent statutory requirements.

The proposed amendment to §15.55 would delete a provision that applied in 1998 when this rule was phased in but is now obsolete.

Proposed amendments to §15.60(a) would delete an obsolete reference to fees required to be collected under the federal Propane Education and Research Act of 1996. In subsection (d), the commission proposes to delete as unnecessary the requirement that a copy of AFRED Form 4 be filed with the commission. The commission finds that the recordkeeping requirements already included in §15.60 are adequate to facilitate audits and document compliance without requiring that copies of Form 4 be provided separately to the division.

Proposed amendments to §15.65 and §15.70 would specify in greater detail the procedures to be used by odorizers and importers to administer refunds of fees paid in error.

In §15.90 the commission proposes to delete test equipment from the list of materials the commission may examine when conducting an LPG delivery-fee audit at an odorizer's or importer's office, premises, or place of business.

Proposed amendments to §15.95(a) and (e) would allow an odorizer or importer 30 days from the date of a letter detailing the findings of an audit or investigation, instead of 20 days from the postmark date, to file a written response to the commission. Proposed amendments to §15.95(d) would delete references to certified mail, to allow the commission to use electronic mail or other means of delivery as appropriate. These changes would make the commission's administrative procedures for LPG delivery-fee audits consistent with the commission's procedures for gas-utility audits.

Proposed amendments to §15.100(b) would illustrate how the commission's rules apply in a typical case where a supplier agrees to act as an importer's agent. Similarly, the examples given in §15.100(d) illustrate how the commission's rules apply to administration of refunds of fees paid in error.

Propane Consumer Rebate Program

Proposed amendments to §§15.105 and 15.160 are nonsubstantive and would standardize the title of the Gas Services Division, LP-Gas Section, and update a cross-reference to another commission rule in §15.160(a). The proposed amendment to §15.110 changes the term "undesignated head" to "subchapter." Proposed amendments to §15.120 would clarify that replacing less efficient gas equipment is a valid category of installation that is eligible for rebates. Such replacements are consistent with Texas Natural Resources Code, §113.2435, which authorizes rebates for the purposes of achieving energy conservation and improving efficiency.

Media Rebate Program; Highway Signage Rebate Program

Proposed amendments to §15.205 would clarify that certain highway signs are eligible for media rebates. The proposed amendment to §15.210 changes the term "undesignated head" to "subchapter." The amendments would also update the address of the division's Austin office in §15.220 and correct references to the Gas Services Division, LP-Gas Section in §15.305. Proposed amendments to §15.305 substitute "subchapter" for a long list of rule numbers and, in §15.310, change the term "undesignated head" to "subchapter."

Manufactured Housing Incentive Program

Proposed amendments to §15.405 would substitute "subchapter" for "chapter" and would delete the requirement that a manufactured housing retailer or salesperson complete and submit a separate application to the commission to become a participant in the manufactured housing incentive program. The proposed change would eliminate duplication and reduce administrative cost, since the necessary representations and certifications required of participants are included on the form that retailers and salespersons must complete and sign each time they apply for an incentive.

The proposed amendments to §15.420 and §15.430 would delete the requirement that the purchaser of an eligible manufactured housing unit must apply and be approved for a consumer rebate on the propane equipment installed in the unit before the manufactured housing retailer or salesperson becomes eligible to receive a manufactured housing incentive for selling the unit. The commission finds that this requirement is unnecessary and may unfairly delay or deny a manufactured housing incentive payment to a retailer or salesperson through actions of the purchaser that are outside the retailer's or salesperson's control.

The proposed amendment in §15.425 would delete the requirement that the division notify an applicant in writing when an application is found to be incomplete or incorrect. This change would allow the division to notify applicants by e-mail, telephone or other more efficient means as appropriate.

The proposed amendment to §15.445 corrects a reference to the title of another commission rule.

Dan Kelly, Director, Alternative Fuels Research and Education Division, has determined that, for each year of the first five years that the amendments are proposed to be in effect, there will be no fiscal implications for state or local governments. The proposed amendments do not propose major program or procedural changes and are expected to provide greater efficiency in the administration of the division's programs.

Mr. Kelly has also determined that, for each year of the first five years the amendments are proposed to be in effect, the public benefit anticipated as a result of enforcing the amendments will be improved efficiency in the administration of LPG delivery fees, more effective representation of the propane industry and more efficient operation of the division's advisory committee, and more efficiency, accuracy and clarity in the administration of the commission's rebate and incentive programs.

There is no anticipated economic cost to individuals, small businesses, or micro-businesses required to comply with the proposed amendments. Small businesses that import odorized LPG and are required to collect and remit LPG delivery fees may experience savings by entering into agency agreements with out- of-state suppliers that are already set up to administer the fees. These savings cannot be estimated accurately and will vary from company to company according to the number of loads imported and other factors. Participation in rebate programs is voluntary.

Comments on the proposal may be submitted to Dan Kelly, Director, Alternative Fuels Research and Education Division, Railroad Commission of Texas, P.O. Box 12967, Austin, Texas 78711-2967, or via electronic mail to dan.kelly@rrc.state.tx.us. Comments will be accepted for 30 days after publication in the Texas Register . For more information, call Mr. Kelly at (512) 463-7291.

The commission simultaneously proposes the review and readoption of Chapter 15 in accordance with Texas Government Code, §2001.039. The agency's reasons for adopting the rules, with the proposed amendments, continue to exist. The notice of proposed review will be filed with the Texas Register concurrently with this proposal.

Subchapter A. GENERAL RULES

16 TAC §§15.5, 15.30, 15.41, 15.45, 15.55, 15.60, 15.65, 15.70, 15.90, 15.95, 15.100

The amendments are proposed under Texas Natural Resources Code, §113.241, which authorizes the commission to adopt all necessary rules relating to the purposes of Texas Natural Resources Code, Chapter 113, Subchapter I, and activities regarding the use of LP-gas and other environmentally beneficial alternative fuels that are or have the potential to be effective in improving the quality of air in this state; §113.246, which requires the commission to adopt rules necessary for the administration, collection, reporting, and payment of the fees payable or collected under this subchapter; §113.242, which authorizes the commission to appoint one or more advisory committees composed of members representing the LP-gas industry and other environmentally beneficial alternative fuels industries, consumers, and other interests to consult with and advise the commission on opportunities and methods to expand the use of LP-gas and other environmentally beneficial alternative fuels; §113.243, which authorizes the commission to research, develop, and implement marketing, advertising, and informational programs relating to alternative fuels to make alternative fuels more understandable and readily available to consumers; and §113.2435, which authorizes the commission to establish consumer rebate programs for purchasers of appliances and equipment fueled by LP-gas or other environmentally beneficial alternative fuels for the purpose of achieving energy conservation and efficiency and improving the quality of air in this state.

Texas Natural Resources Code, §113.241-113.250, are affected by the proposed amendments.

Issued in Austin, Texas on May 9, 2002.

§15.5.AFRED Forms.

(a) Under the provisions of the Texas Natural Resources Code, §§113.241-113.250, inclusive, the Railroad Commission of Texas adopts the following forms for use by the Alternative Fuels Research and Education Division.

(1) - (7) (No change.)

(8) AFRED Form 6A. Odorizer or Importer Designation of Agent.

(b) (No change.)

§15.30.Propane Alternative Fuels Advisory Committee.

(a) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise.

(1) - (2) (No change.)

(3) Consumer representative--A member of the committee who is not engaged in the business of producing, distributing or retailing propane and who is not engaged in the business of designing, manufacturing, distributing or retailing propane equipment [ or performing propane-related research services or other services ], but who is an end-user of odorized propane fuel, including but not limited to a consumer of odorized propane as a residential or commercial heating or water-heating fuel, as an automotive or other transportation fuel, or as an agricultural or industrial fuel.

(4) - (5) (No change.)

(6) Industry representative--A member of the committee who is engaged in the business of producing, distributing or retailing propane or who is engaged in the business of designing, manufacturing, distributing or retailing propane equipment [ or performing propane-related research or other services ].

(7) - (9) (No change.)

[ (10) Subcommittee--A panel of no fewer than five members of the committee assigned to handle issues relating to research, marketing, or public education.]

(b) Establishment; duration. Effective September 1, 1994, the committee is hereby established. The committee is abolished on October 31, 2006, [ September 1, 2002, ] unless the commission amends this subsection to establish a different date.

(c) - (h) (No change.)

[ (i) Subcommittees. The committee shall be organized into three subcommittees of no fewer than five members each for research, marketing, and public education. One member of each subcommittee shall serve as the chair of that subcommittee. The subcommittee chairs shall make written reports regarding their subcommittee's work to the presiding officer.]

(i) [ (j) ] Meetings. The committee shall meet at the call of the presiding officer or the commission. Committee [ and subcommittee ] meetings are open to the public.

(j) [ (k) ] Committee records. The division staff shall record and maintain the originals of the minutes of each committee [ and subcommittee ] meeting. The division shall maintain a record of actions taken by the committee and shall distribute copies of approved minutes and other committee documents to the commission and the committee members.

(k) [ (l) ] Evaluation of committee costs and benefits. By October 1 of each year, the division director shall evaluate for the previous fiscal year and report to the commission:

(1) the committee's work;

(2) the committee's usefulness; and

(3) the costs related to the committee's existence, including the cost of commission staff time spent in support of the committee's activities.

(l) [ (m) ] Report to Legislative Budget Board. The commission shall biennially report to the Legislative Budget Board the information developed under subsection (k) [ (l) ] of this section in evaluating the committee's costs and benefits.

§15.41.Definitions.

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

(1) - (7) (No change.)

(8) Importer--A person who causes odorized LPG to be moved into Texas from a location outside Texas , or a supplier who has been designated as the agent of such person on AFRED Form 6A .

(9) - (11) (No change.)

(12) Odorizer--A person who adds odorant to LPG within Texas, including but not limited to an LPG supplier, terminal operator, loading rack operator, or a person subject to filing odorization reports with the commission and complying with the commission's odorization rule, §9.114 of this title (relating to Odorizing and Reports) [ §9.152 of this title (relating to Report of Odorization) ], or a supplier who has been designated as the agent of such person on AFRED Form 6A.

(13) - (19) (No change.)

§15.45.Registration of Odorizers, Odorizer Agents, [ and ] Importers and Importer Agents .

(a) All odorizers and importers are subject to this section on September 1, 1997, or the date that the odorizer first odorizes LPG within Texas or the importer first imports odorized LPG into Texas. Odorizer agents are subject to this section on the date the odorizer and the odorizer's agent sign AFRED Form 6A. Importer agents are subject to this section on the date the importer and the importer's agent sign AFRED Form 6A.

(b) - (c) (No change.)

(d) Importers may delegate the duties related to administration of delivery fees under Texas Natural Resources Code, §§113.241-113.250, inclusive, and §15.50 and §15.55 of this title (relating to Fee on Delivery of Odorized LPG, and Report and Remittance of Fees), to one or more suppliers if:

(1) the importer and supplier execute and file with the commission AFRED Form 6A, which makes the supplier legally responsible for performing the importer's duties related to administration of delivery fees under Texas Natural Resources Code, §§113.241-113.250, inclusive, and §15.50 and §15.55 of this title (relating to Fee on Delivery of Odorized LPG, and Report and Remittance of Fees) at a specific facility where LPG is odorized. The importer and supplier shall execute and file with the commission a separate AFRED Form 6A for each facility at which the supplier acts as agent for the importer. The execution of AFRED Form 6A shall be voluntary on the part of the supplier and shall not be a condition of the supplier doing business with an importer. The execution of AFRED Form 6A makes the supplier subject to all obligations of an importer under §15.1-15.100 of this title, inclusive, which include, among other things, retaining documents and permitting audit by the commission.

(2) Importers filing AFRED Form 6A shall also file AFRED Form 6.

(e) [ (d) ] Each person subject to this section shall file a new AFRED Form 6 or AFRED Form 6A within 30 days after any change in any of the information reported on either form, and shall report in writing the termination of an agent designation within 30 days of the termination.

(f) [ (e) ] Failure to file AFRED Form 6 and AFRED Form 6A as required by this section may subject the person to civil penalties under §15.80 of this title (relating to Civil Penalties).

(g) [ (f) ] Filing AFRED Form 6 or AFRED Form 6A does not satisfy an odorizer's obligation to file LPG Form 17 under §9.114 of this title (relating to Odorizing and Reports) [ §9.152 of this title (relating to Report of Odorization) ].

§15.55.Report and Remittance of Fees.

[ (a) ] On or before the 25th day of each month, or the first business day after the 25th day of each month in which the 25th falls on a Saturday, Sunday, or a legal holiday, each odorizer and importer shall file a report and remit to the commission all fees due on odorized LPG delivered into a means of conveyance in the previous month. Fees are due to the commission on all LPG delivered into a means of conveyance in the previous month, regardless of whether the fees were actually collected from persons responsible for paying the fees in that month. The report shall be prepared on AFRED Form 1, Odorizer's or Importer's Report of Fees Collected, shall be filed by mailing the completed form and fees to AFRED, and shall be postmarked on or before the deadline for filing. Late filings or failure to file as required will subject the odorizer or importer to additional fees or penalties under §15.75 and §15.80 of this title (relating to Penalty for Failure To Report as Required and Civil Penalties).

[ (b) Odorizers and importers may file amended reports for the months of September 1997 through March 1998 without penalty, provided such reports are postmarked on or before April 27, 1998.]

§15.60.Exemptions.

(a) No fee shall be collected on any deliveries of odorized LPG destined for export out of Texas if the LPG is in continuous movement to a destination outside the state [ , unless such a fee is required to be levied and collected under the federal Propane Education and Research Act of 1996 (15 USC §6401, et seq.) ].

(b) - (c) (No change.)

(d) AFRED Form 4, Blanket Exemption, or another form specifically approved in advance in writing as equivalent by the division, shall be completed by any person obtaining an exemption for all LPG purchased and filed annually with the odorizer or importer [ and a copy filed with AFRED ]. Each odorizer or importer shall keep all exemption forms on file for a minimum of four years and readily available in a convenient and organized manner for commission inspection.

§15.65.Odorizer or Importer Refunds.

Any person who pays a fee to an odorizer or importer on a load of LPG that is exempt under §15.60 of this title (relating to Exemptions) may apply to the odorizer or importer for a refund of the amount paid. To apply for the refund, the person shall complete AFRED Form 5, Refund Request to Odorizer or Importer, and return it to the odorizer or importer that collected the fee. Any odorizer or importer that refunds a fee that was remitted to the commission in a previous month based on receipt of AFRED Form 5 shall report the amount of the refund on [ Schedule A of ] AFRED Form 1 in the block labeled Adjustment for Refunds; complete Schedule A (AFRED Form 1A, Schedule of Refund Amounts); and submit the completed forms to the division . All amounts refunded and reported in this manner may be deducted from the total amount of fees collected to arrive at the total amount of fees to be remitted to the commission. An odorizer or importer shall maintain on file for a minimum of four years the refund request forms for all refunds reported to the commission, and shall make these forms readily available for commission inspection.

§15.70.Commission Refund.

An odorizer or importer may petition the commission for refund of fees remitted in a previous month to the commission in error. An odorizer or importer seeking a refund shall complete AFRED Form 3, Fee on Delivery of Odorized LPG: Refund Request to Commission; shall include a statement of the reason for the refund and all supporting export and fee-payment documents; and shall file the request with the commission by mailing the completed form and all supporting documents to the division [ AFRED ]. Supporting export documents include, but are not limited to, bills of lading, shipping manifests and load tickets. Supporting fee-payment documents include, but are not limited to, invoices, ledgers and journal entries tied to export documents. In lieu of issuing a warrant, the commission may permit an odorizer or importer to deduct the amount of an approved refund from the total amount of fees remitted to the commission in a subsequent month.

§15.90.Power of Entry; Audits and Investigations.

(a) A member or employee of the commission, the director, or another person authorized or designated by any such person, at reasonable times and for reasonable purposes, may enter an office, premises, or place of business of an odorizer or importer [ to test equipment and ] to inspect, examine, and obtain copies of the papers, books, accounts, documents, business records, and other materials maintained under §15.85 of this title (relating to Records) for the purpose of conducting an audit or investigation or enforcing or administering the AFRED program or commission rules.

(b) (No change.)

§15.95.Procedure for Compliance with or Challenge to Audit Results.

(a) Upon completion of an audit or investigation, the auditor or investigator shall deliver a written copy of the findings to the director and shall provide [ mail by certified mail ] a copy to the odorizer or importer that is the subject of the audit or investigation. The odorizer or importer shall [ may ] file a written response, if requested, and shall have 30 [ 20 ] days from the date on the letter [ the findings are postmarked ] to file the response with the director.

(b) - (c) (No change.)

(d) The director shall give the odorizer or importer written notice of the report by mailing it to the odorizer or importer [ by certified mail ]. The notice shall include a statement that the odorizer or importer has a right to a hearing on the director's determination contained in the report.

(e) Within 30 [ 20 ] days after the date on the notice [ is postmarked ], the odorizer or importer shall file a written response either accepting the director's determination, and recommended penalty, if any, or requesting a hearing on the director's determination.

(f) - (i) (No change.)

§15.100.Interpretation and Application.

(a) The fact situations in subsections (b) and (c) of this section illustrate the commission's interpretation and application of Texas Natural Resources Code, §§113.241, et seq., and the rules adopted pursuant thereto, §§15.1, et seq. of this title, and demonstrate how the commission will determine which entities are responsible for paying and for collecting and remitting the fee.

(b) Treatment of imports. Wholesale quantities of odorized LPG are imported into Texas under different business circumstances and contractual conditions. In each case, the statute requires the fee to be assessed on the total volume of LPG imported in the transport vehicle, regardless whether the entire load is delivered in Texas. The following examples are intended to illustrate how the commission's rules for administering LPG delivery fees apply to five import situations. Example (6) is given to illustrate how the commission's rules apply in a situation where a supplier agrees to act as an importer's agent.

(1) - (5) (No change.)

(6) Importer designation of agent. To minimize administrative cost to the industry, the commission's rules permit a supplier to collect and remit fees as agent for an importer on deliveries made at a storage or terminal facility located outside Texas if the importer and supplier execute and file with the commission AFRED Form 6A, to make the supplier legally responsible for performing the importer's duties related to administration of delivery fees under Texas Natural Resources Code, §§113.241-113.250, inclusive. A separate AFRED Form 6A is required for each facility at which the supplier will serve as the importer's agent for purposes of administering LPG delivery fees. If no AFRED Form 6A is on file with the commission, any person who imports odorized LPG is responsible for registering as an importer and for remitting fees to the commission on all nonexempt loads the person imports.

(c) (No change.)

(d) Refunds. Refunds of LPG delivery fees paid in error typically involve either an odorizer or supplier reimbursing a marketer or the commission reimbursing an odorizer, supplier, or importer.

(1) Supplier or odorizer reimburses marketer. In this example, a marketer has paid a fee in error to a supplier. Under commission rules, the marketer is required to request a refund from the supplier by completing AFRED Form 5 and attaching documents that prove no fee was owed, e.g., documents proving that the LPG qualified for an export exemption. The supplier verifies the claim, refunds the amount paid in error, and retains AFRED Form 5 and related attachments for a minimum of four years for audit purposes.

(2) Supplier refund deduction. In this example, a supplier refunds a fee paid in error as described in paragraph (1) of this subsection.

(A) Refund of fees previously remitted. If the refund is of a fee that the supplier has previously remitted to the commission, the supplier may report the refund on Schedule A (AFRED Form 1A), enter the amount refunded in the Adjustment for Refunds block on AFRED Form 1, and deduct the amount of the refund from the total remitted with AFRED Form 1.

(B) Refund of fees not previously remitted. If the refund is of a fee that the supplier has not previously remitted to the commission, the supplier shall retain AFRED Form 5 and related attachments for a minimum of four years for audit purposes. The supplier shall not report the refund on Schedule A (AFRED Form 1A). The supplier shall not enter the amount refunded in the Adjustment for Refunds block on AFRED Form 1, and shall not deduct the amount refunded from the total amount remitted with AFRED Form 1.

(3) Commission reimburses supplier, odorizer, or importer. A supplier, odorizer, or importer that has remitted a delivery fee to the commission in error may apply to the commission for a refund. The person claiming the refund shall send the division a completed AFRED Form 3, and attach a bill of lading, shipping manifest or load ticket documenting that the load was exempt, and an invoice, ledger, or journal entry tied to the load and documenting that a fee was previously paid on the load. In lieu of issuing a warrant, the commission may permit an odorizer or importer to deduct the amount of an approved refund from the total amount of fees remitted to the commission in a subsequent month.

(e) [ (d) ] The fact situations in subsections (b) , (c) , and (d) [ and (c) ] of this section are illustrative only. In all situations, the commission will apply the provisions of Texas Natural Resources Code, §§113.241, et seq., and the rules adopted pursuant thereto, §§15.1, et seq. of this title, to achieve the intended statutory purpose of assessing the fee on LPG, not otherwise exempt, that is either odorized in Texas or imported in odorized form into Texas.

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 May 9, 2002.

TRD-200202869

Mary Ross McDonald

Deputy General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: June 23, 2002

For further information, please call: (512) 475-1295


Subchapter B. PROPANE CONSUMER REBATE PROGRAM

16 TAC §§15.105, 15.110, 15.120, 15.160

The amendments are proposed under Texas Natural Resources Code, §113.241, which authorizes the commission to adopt all necessary rules relating to the purposes of Texas Natural Resources Code, Chapter 113, Subchapter I, and activities regarding the use of LP-gas and other environmentally beneficial alternative fuels that are or have the potential to be effective in improving the quality of air in this state; §113.246, which requires the commission to adopt rules necessary for the administration, collection, reporting, and payment of the fees payable or collected under this subchapter; §113.242, which authorizes the commission to appoint one or more advisory committees composed of members representing the LP-gas industry and other environmentally beneficial alternative fuels industries, consumers, and other interests to consult with and advise the commission on opportunities and methods to expand the use of LP-gas and other environmentally beneficial alternative fuels; §113.243, which authorizes the commission to research, develop, and implement marketing, advertising, and informational programs relating to alternative fuels to make alternative fuels more understandable and readily available to consumers; and §113.2435, which authorizes the commission to establish consumer rebate programs for purchasers of appliances and equipment fueled by LP-gas or other environmentally beneficial alternative fuels for the purpose of achieving energy conservation and efficiency and improving the quality of air in this state.

Texas Natural Resources Code, §113.241-113.250, are affected by the proposed amendments.

Issued in Austin, Texas on May 9, 2002.

§15.105.Definitions.

The following words and terms, when used in this chapter (relating to the Alternative Fuels Research and Education Division) shall have the following meanings, unless the context clearly indicates otherwise.

(1) - (11) (No change.)

(12) Propane dealer--A person who:

(A) has been issued a current Category E license from the Gas Services Division, LP-Gas Section [ , Gas Services Division ] of the commission, or is an active company representative or operations supervisor on file with the Gas Services Division, LP-Gas Section; and

(B) operates or manages a retail business, including any branch outlet or outlets, delivering odorized propane to consumers; and

(C) has completed and submitted the form prescribed by the commission for dealer participation in the rebate program; and

(D) is a regular supplier or a potential regular supplier of propane to an applicant.

(13) (No change.)

§15.110.Establishment; Duration.

The rebate program is hereby established on the effective date of this subchapter [ undesignated head ] (relating to the Alternative Fuels Research and Education Division). The commission may terminate this rebate program at any time.

§15.120.Eligibility.

(a) To be eligible for a rebate under this program, a consumer must document, using forms prescribed by the commission for the purpose, that:

(1) an eligible installation has been performed;

(2) the eligible installation for which application is made either replaced existing electric or gasoline-fueled equipment or less efficient gas equipment, or occurred in new construction; and

(3) a safety inspection of the eligible installation has been performed.

(b) - (e) (No change.)

§15.160.Complaints.

(a) Any person may file a complaint about an applicant, a propane dealer or another person regarding alleged violations of the rebate program rules. Complaints should be sent in writing to the division director at the address set forth in §15.125(d) [ §15.125(e) ] of this title (relating to Application).

(b) Complaints that an installation does not comply with the commission's LP-gas safety rules should be sent in writing to the assistant director of the Gas Services Division, LP-Gas Section [ , Gas Services Division ] of the commission at the same address.

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 May 9, 2002.

TRD-200202870

Mary Ross McDonald

Deputy General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: June 23, 2002

For further information, please call: (512) 475-1295


Subchapter C. MEDIA REBATE PROGRAM

16 TAC §§15.205, 15.210, 15.220

The amendments are proposed under Texas Natural Resources Code, §113.241, which authorizes the commission to adopt all necessary rules relating to the purposes of Texas Natural Resources Code, Chapter 113, Subchapter I, and activities regarding the use of LP-gas and other environmentally beneficial alternative fuels that are or have the potential to be effective in improving the quality of air in this state; §113.246, which requires the commission to adopt rules necessary for the administration, collection, reporting, and payment of the fees payable or collected under this subchapter; §113.242, which authorizes the commission to appoint one or more advisory committees composed of members representing the LP-gas industry and other environmentally beneficial alternative fuels industries, consumers, and other interests to consult with and advise the commission on opportunities and methods to expand the use of LP-gas and other environmentally beneficial alternative fuels; §113.243, which authorizes the commission to research, develop, and implement marketing, advertising, and informational programs relating to alternative fuels to make alternative fuels more understandable and readily available to consumers; and §113.2435, which authorizes the commission to establish consumer rebate programs for purchasers of appliances and equipment fueled by LP-gas or other environmentally beneficial alternative fuels for the purpose of achieving energy conservation and efficiency and improving the quality of air in this state.

Texas Natural Resources Code, §113.241-113.250, are affected by the proposed amendments.

Issued in Austin, Texas on May 9, 2002.

§15.205.Definitions.

The following words and terms, when used in this subchapter [ undesignated head ], relating to the Alternative Fuels Research and Education Division, shall have the following meanings, unless the context clearly indicates otherwise.

(1) - (5) (No change.)

(6) Eligible media outlet--A media outlet, including, but not limited to, a radio or television station or cable franchise licensed by the Federal Communications Commission; a weekly or daily published newspaper; a weekly, monthly or bi-monthly magazine; a provider of billboard advertising; or a publisher of an annual or seasonal special events program that regularly accepts paid advertising from the public and whose target audience and message are consistent with the goals of the commission. The media outlet must be approved by the commission in advance of purchase of advertising. The term does not include dealer-published newsletters, fliers or specialty advertising. A highway sign is eligible, provided the sign:

(A) is permanently affixed to a building, structure, or the ground and designed or constructed in such a manner that it cannot be moved or relocated without major structural or support changes; and

(B) the final design of the sign has been approved in advance in writing by the division.

(7) - (9) (No change.)

(10) Propane dealer--A person who:

(A) has been issued a current Category E license from the Gas Services Division, LP-Gas Section [ Division ] of the commission, or is an active company representative or operations supervisor on file with the LP-Gas Section [ Division ]; and

(B) operates or manages a retail business, including any branch outlet or outlets, delivering odorized propane to consumers; and

(C) has completed and submitted the form prescribed by the commission for dealer participation in the media rebate program.

(11) Retail propane delivery truck--Any bobtail truck, semitrailer, or other motor vehicle equipped with an LP-gas cargo container and each trailer, semitrailer, or other motor vehicle used principally for transporting LP-gas in portable containers that:

(A) has aggregate water capacity of 4,999 gallons or less; and

(B) is currently registered with the Gas Services Division, LP-Gas Section [ Division ] of the commission.

§15.210.Establishment; Duration.

The media rebate program is hereby established on the effective date of this subchapter [ undesignated head ] (relating to the Alternative Fuels Research and Education Division). The commission may terminate this rebate program at any time.

§15.220.Application.

(a) - (c) (No change.)

(d) Acceptance. Applications will be accepted no earlier than the effective date of this rule and no later than the date of termination of the program. An application must be received at the commission no later than 60 days following the date of the eligible media purchase to be eligible for rebates. Applications may be mailed or hand-delivered to the Railroad Commission of Texas, Alternative Fuels Research and Education Division, 1701 North Congress Avenue, Room 11-170 [ 10-115 ], P.O. Box 12967, Austin, Texas 78711-2967. Applications may not be submitted electronically or by facsimile transmission (FAX).

(e) - (g) (No change.)

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 May 9, 2002.

TRD-200202871

Mary Ross McDonald

Deputy General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: June 23, 2002

For further information, please call: (512) 475-1295


Subchapter D. HIGHWAY SIGNAGE REBATE PROGRAM

16 TAC §15.305, §15.310

The amendments are proposed under Texas Natural Resources Code, §113.241, which authorizes the commission to adopt all necessary rules relating to the purposes of Texas Natural Resources Code, Chapter 113, Subchapter I, and activities regarding the use of LP-gas and other environmentally beneficial alternative fuels that are or have the potential to be effective in improving the quality of air in this state; §113.246, which requires the commission to adopt rules necessary for the administration, collection, reporting, and payment of the fees payable or collected under this subchapter; §113.242, which authorizes the commission to appoint one or more advisory committees composed of members representing the LP-gas industry and other environmentally beneficial alternative fuels industries, consumers, and other interests to consult with and advise the commission on opportunities and methods to expand the use of LP-gas and other environmentally beneficial alternative fuels; §113.243, which authorizes the commission to research, develop, and implement marketing, advertising, and informational programs relating to alternative fuels to make alternative fuels more understandable and readily available to consumers; and §113.2435, which authorizes the commission to establish consumer rebate programs for purchasers of appliances and equipment fueled by LP-gas or other environmentally beneficial alternative fuels for the purpose of achieving energy conservation and efficiency and improving the quality of air in this state.

Texas Natural Resources Code, §113.241-113.250, are affected by the proposed amendments.

Issued in Austin, Texas on May 9, 2002.

§15.305.Definitions.

The following words and terms, when used in this subchapter [ §§15.301, 15.305, 15.310, 15.315, 15.320, 15.325, 15.330, 15.335, 15.340, 15.345, and 15.350 of this title (relating to the Alternative Fuels Research and Education Division) ], shall have the following meanings, unless the context clearly indicates otherwise.

(1) - (9) (No change.)

(10) Eligible propane and/or natural gas outlet--A retail motor fuel outlet that is:

(A) located in the State of Texas;

(B) licensed by the commission's Gas Services Division , LP- Gas Section ; and

(C) in compliance with all applicable federal, state and local legal requirements for the sale of propane and/or natural gas motor fuel to the general motoring public.

(11)- (14) (No change.)

(15) Owner or operator of a propane and/or natural gas motor fuel outlet open to the motoring public--A person who:

(A) has been issued a current Category E, G, I or J LPG license or a current Category 3 or 5 CNG license from the Gas Services Division , LP-Gas Section, of the commission, or is an active company representative or operations supervisor on file with the Gas Services Division , LP-Gas Section ; and

(B) operates or manages a retail business, including any branch outlet or outlets, that offers propane and/or natural gas refueling services to the general motoring public; and

(C) has completed and timely submitted the form prescribed by the commission for participation in the alternative fuel highway signage rebate program.

(16) - (17) (No change.)

§15.310.Establishment; Duration; Operation.

(a) The alternative fuel highway signage rebate program is hereby established on the effective date of this subchapter [ undesignated head ] of this chapter (relating to the Alternative Fuels Research and Education Division).

(b) - (c) (No change.)

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 May 9, 2002.

TRD-200202872

Mary Ross McDonald

Deputy General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: June 23, 2002

For further information, please call: (512) 475-1295


Subchapter E. MANUFACTURED HOUSING INCENTIVE PROGRAM

16 TAC §§15.405, 15.420, 15.425, 15.430, 15.445

The amendments are proposed under Texas Natural Resources Code, §113.241, which authorizes the commission to adopt all necessary rules relating to the purposes of Texas Natural Resources Code, Chapter 113, Subchapter I, and activities regarding the use of LP-gas and other environmentally beneficial alternative fuels that are or have the potential to be effective in improving the quality of air in this state; §113.246, which requires the commission to adopt rules necessary for the administration, collection, reporting, and payment of the fees payable or collected under this subchapter; §113.242, which authorizes the commission to appoint one or more advisory committees composed of members representing the LP-gas industry and other environmentally beneficial alternative fuels industries, consumers, and other interests to consult with and advise the commission on opportunities and methods to expand the use of LP-gas and other environmentally beneficial alternative fuels; §113.243, which authorizes the commission to research, develop, and implement marketing, advertising, and informational programs relating to alternative fuels to make alternative fuels more understandable and readily available to consumers; and §113.2435, which authorizes the commission to establish consumer rebate programs for purchasers of appliances and equipment fueled by LP-gas or other environmentally beneficial alternative fuels for the purpose of achieving energy conservation and efficiency and improving the quality of air in this state.

Texas Natural Resources Code, §113.241-113.250, are affected by the proposed amendments.

Issued in Austin, Texas on May 9, 2002.

§15.405.Definitions.

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

(1) - (10) (No change.)

(11) Manufactured housing retailer or salesperson--A person who:

(A) meets the requirements of the Texas Manufactured Housing Standards Act, Article 5221f, Vernon's Texas Civil Statutes, as a retailer or salesperson; and

(B) possesses a currently valid certificate of registration from the Texas Department of Housing and Community Affairs or its successor and any other certification or license required [ ; and ]

[ (C) has completed and submitted the application prescribed by the commission for participation in the manufactured housing incentive program].

(12) - (14) (No change.)

(15) Propane dealer--A person who:

(A) has been issued a current Category E license from the Gas Services Division, LP-Gas Section, [ Gas Services Division, ] of the commission, or is an active company representative or operations supervisor on file with the Gas Services Division, LP-Gas Section, [ Gas Services Division ]; and

(B) operates or manages a retail business, including any branch outlet or outlets, delivering odorized propane to consumers.

(16) - (17) (No change.)

§15.420.Eligibility.

(a) To be eligible for an incentive under this program, a manufactured housing retailer or salesperson must document, using forms prescribed by the commission for the purpose, that there has been a purchase of an eligible manufactured housing unit, that a propane-fueled water heater and furnace have been installed, and that a safety inspection has been performed on the eligible installation.

[ (b) The purchaser or owner of the eligible manufactured housing unit shall have submitted to the commission an application for a consumer rebate prior to issuance of the manufactured housing incentive.]

(b) [ (c) ] No applicant shall be eligible for an incentive unless the delivery date of the application is no later than 120 days following the date of purchase of the manufactured housing unit.

§15.425.Application Procedure.

(a) - (f) (No change.)

(g) The division shall notify an applicant [ in writing ] that the applicant's application is incomplete or incorrect. Applicants shall have 30 days from the date of the postmark on the division's notice to correct any errors or omissions on the application. If the applicant fails to file the requested information with the division within this 30-day period, the application shall be void.

(h) (No change.)

§15.430.Payment of Incentive.

(a) The division may approve payment of a incentive to an applicant subject to the availability of funds. Applicants have no legal right or other entitlement to receive incentives under this program, and the division's receipt of a complete and correct application does not bind the division to approve or the commission to make payment of an incentive to any applicant.

[ (b) No application may be approved for payment before the purchaser's consumer rebate is approved for payment.]

(b) [ (c) ] Incentive amounts assigned shall be those in effect on the delivery date of each application.

§15.445.Complaints.

(a) Subject to the limitation set forth in subsection (b) of this section, any person may file a complaint alleging violations of the manufactured housing incentive program rules by a manufactured housing retailer, salesperson, propane dealer or another person. Complaints shall be in writing, shall set forth the specific facts alleged to constitute the violation, and shall be mailed or hand-delivered to the division director at the address set forth in §15.425 of this title (relating to Application Procedure ).

(b) (No change.)

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 May 9, 2002.

TRD-200202873

Mary Ross McDonald

Deputy General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: June 23, 2002

For further information, please call: (512) 475-1295


Part 4. TEXAS DEPARTMENT OF LICENSING AND REGULATION

Chapter 80. LICENSED COURT INTERPRETERS

16 TAC §80.80

The Texas Department of Licensing and Regulation ("Department") proposes amendments to §80.80 concerning the fees for the licensed court interpreters program.

The proposed amendment is necessary to correct the license application filing fee. Section 80.80 provides that the fee for an original license application is $200, when, in fact, the Commission of Licensing and Regulation authorized this fee to be $175. This has resulted in overpayments by applicants for licensure. The amendment to §80.80 was previously adopted on an emergency basis and was published in the January 4, 2002 issue of the Texas Register (27 TexReg 13). In addition, the Department has simultaneously filed an extension request renewing the effectiveness of the emergency adoption for a 60-day period in the emergency rule section of this issue of the Texas Register .

Jimmy G. Martin, Director, Enforcement Division, Texas Department of Licensing and Regulation, has determined that for the first five-year period this section is in effect there will be fiscal implications as a result of enforcing or administering the proposed amended rule. The annual average revenue would decrease $19,000 for the first year from the original amount published in the August 3, 2001 issue of the Texas Register (26 TexReg 5738), from $167,525 to $148,525. Over the five-year period the total reduction would be $95,000 from the original amount published in the August 3, 2001 issue of the Texas Register (26 TexReg 5738), from $837,625 to $742,625. Costs to the state are expected to be approximately equal to these revenues. There will be no fiscal implications on local government.

Mr. Martin also has determined that for each year of the first five years this section is in effect the public benefit anticipated as a result of enforcing this section will be clarification regarding the original license fees.

The anticipated economic effect on small businesses and persons who are required to comply with the section as proposed will be an original license application fee of $175 instead of the $200 fee adopted in the October 12, 2001 issue of the Texas Register (26 TexReg 8065).

Comments on the proposal may be submitted to Jimmy G. Martin, Director, Enforcement Division, Texas Department of Licensing and Regulation, P.O. Box 12157, Austin, Texas 78711, or facsimile (512) 475-2872, or electronically: jimmy.martin@license.state.tx.us. The deadline for comments is 30 days after publication in the Texas Register .

The amendment to §80.80 is proposed under Texas Occupations Code, Chapter 51, and Title 2, Texas Government Code, Chapter 57. The Department interprets Chapter 51 as authorizing the Executive Director to adopt rules as necessary to implement this chapter and any other law establishing a program regulated by the Department. The Department interprets Chapter 57 as authorizing the Executive Director of the Texas Department of Licensing and Regulation to promulgate and enforce a code of rules and take all action necessary to assure compliance with the intent and purpose of Chapter 57.

The statutory provisions affected by the proposal are those set forth in Title 2, Texas Government Code, Chapter 57, and Texas Occupations Code, Chapter 51. No other statutes, articles, or codes are affected by the proposal.

§80.80.Fees.

(a) All fees are non-refundable.

(b) The original license application filing fee shall be $175 [ $200 ].

(c) The renewal application filing fee shall be $100.

(d) The fee for obtaining a duplicate license, making a change in name or address, or obtaining an additional language endorsement shall be $50 each.

(e) Each language examination shall have a separate fee of $60 for the written examination and $40 for the oral examination.

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 May 10, 2002.

TRD-200202898

William H. Kuntz, Jr.

Executive Director

Texas Department of Licensing and Regulation

Earliest possible date of adoption: June 23, 2002

For further information, please call: (512) 463-7348


Part 8. TEXAS RACING COMMISSION

Chapter 303. GENERAL PROVISIONS

Subchapter D. TEXAS BRED INCENTIVE PROGRAMS

2. PROGRAM FOR HORSES

16 TAC §303.92

The Texas Racing Commission proposes an amendment to §303.92, relating to thoroughbred rules. The Texas Thoroughbred Association petitioned the Commission for this rule change. The amendment would set forth a procedure for timely payment or distribution of funds held by the breed registry from cross-species simulcasting revenue and from breakage payable to persons who failed to claim their entitlement. The amendment would also conform the rules to the new provisions in the Texas Racing Act.

Judith L. Kennison, General Counsel for the Texas Racing Commission, has determined that for the first five-year period the amendments are in effect there will be no fiscal implications for state or local government.

Ms. Kennison has also determined that for each of the first five years the amendment is in effect the public benefit anticipated as a result of enforcing the proposal will be that the public is assured the Commission will enforce prompt payment to those properly entitled to the funds mentioned above. There will be no economic impact to small or micro businesses. There is no anticipated economic cost to an individual required to comply with the amendment as proposed. The proposal has no effect on the state's agricultural, horse breeding, horse training, greyhound breeding, or greyhound training industries.

Written comments must be submitted within 30 days after publication of the proposed amendment in the Texas Register to Judith L. Kennison, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711-2080, fax (512) 833-6907.

The amendment is proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorizes the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; §6.08, which authorizes the Commission to determine allocation of shares and breakage; §6.091, which authorizes the Commission to makes distributions from simulcast pari-mutuel pools; and §9.01 which authorizes the state horse breed registries to establish rules related to the qualifications of accredited Texas-bred horses.

The proposed amendment implements Texas Civil Statutes, Article 179e.

§303.92.Thoroughbred Rules.

(a) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise:

(1) - (3) (No change.)

(4) Accredited Texas-bred Thoroughbred-- A [ a ] horse registered with the Jockey Club, accredited with the breed registry and conceived and foaled in Texas, out of a mare accredited with the breed registry that is permanently domiciled in Texas [ , and sired by a stallion accredited with the breed registry and standing in Texas at the time of conception of said foal. Also, any horse foaled in Texas may be eligible to be accredited if the mare becomes an accredited mare permanently domiciled in Texas and is next bred, within two seasons, to any Thoroughbred stallion accredited with the breed registry and standing in Texas at the time said mare is covered. If this breed-back is not accomplished the year said foal is born, it must then take place during the breeding season of the foal's yearling year if the foal in question is to be eligible for accreditation ].

(5) Accredited Texas[ -bred ] Thoroughbred Mare--A mare registered with the Jockey Club, accredited with the breed registry, and permanently domiciled in Texas except for racing and breeding privileges. Annual reproductive activity of the mare may be required to be reported to the breed registry in writing via photocopy of the Live Foal Report/No Foal Report submitted annually to the Jockey Club.

(6) Accredited Texas Thoroughbred Stallion--A stallion registered with the Jockey Club, accredited with the breed registry, and standing in Texas. [ If an Accredited Texas Thoroughbred Stallion services any mare outside the State of Texas within that breeding season, those foals conceived outside the state of Texas will be subject to the Breed-Back Rule. ] The breed registry must be notified in writing within 10 calendar days each time the stallion leaves or enters the State of Texas. A photocopy of the annual Report of Mares Bred may be required to be submitted to the breed registry office on or before the date required by the Jockey Club (August 1). Stallion owners are eligible to receive stallion awards only from offspring sired in Texas after the stallion has become accredited with the breed registry and applicable administrative fees have been paid.

(7) (No change.)

(b) (No change.)

(c) Procedure for Payment of Awards.

(1) Conditions precedent for payment of awards are:

(A) (No change.)

(B) Breeder's Awards will be paid only on an accredited Texas-bred Thoroughbred whose dam was accredited with the breed registry prior to foaling the subject horse and is covered by the definition set forth in §1.03(21) of the Act. A horse covered by §1.03(21)(C) of the Act is eligible for only one-half of the incentives awarded pursuant to §6.08(f) and (j) of the Act .

(C) - (F) (No change.)

(2) Owner's Awards.

(A) [ (2) ] Any accredited Texas-bred Thoroughbred that finishes first, second, or third in any race in Texas (with the exception of a stakes race restricted to accredited Texas-breds) shall receive an owner's incentive award. All owner's incentive awards shall be noted in each association's condition book and race program so as to identify the availability of the accredited Texas-bred program owner incentive awards.

(B) An accredited Texas-bred Thoroughbred horse that finishes first, second, or third in a race, other than a Texas-bred race, shall receive an owner's bonus award as a purse supplement, as provided by §6.08(n) of the Act.

(3) Award funds derived by the breed registry pursuant to §6.08(f) of the Act may be allocated and disbursed by the breed registry to purses at Texas associations for races restricted to accredited Texas-bred thoroughbred horses for special event races or days.

(4) Funds actually received from a greyhound association pursuant to §6.091(c)(2) of the Act shall be used as purses by the breed registry within a reasonable time, not to exceed 18 months from date of receipt.

(5) If a share of the breakage cannot be distributed to the person who is entitled to a share, the breed registry shall retain that share. Thereafter, a notice of the entitlement shall be published in the Texas Thoroughbred magazine for the first three issues of the second calendar year after accrual of the entitlement. If the entitlement is not claimed before August 31 following such publication, the funds shall be transferred to the breed registry's general account. If the person entitled to the share thereafter makes a claim in a form acceptable to the breed registry, the breed registry shall pay such person the amount of the share.

(d) (No change.)

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 May 13, 2002.

TRD-200202964

Judith L. Kennison

General Counsel

Texas Racing Commission

Earliest possible date of adoption: June 23, 2002

For further information, please call: (512) 833-6699


Chapter 309. RACETRACK LICENSES AND OPERATIONS

Subchapter C. HORSE RACETRACKS

4. OPERATIONS

16 TAC §309.298

The Texas Racing Commission proposes an amendment to §309.298, related to stakes and other prepayment races. The Texas Horsemen's Partnership petitioned for this amendment. The amendment would prevent dilution by an association of funds paid in for stakes races by horsemen.

Judith L. Kennison, General Counsel for the Texas Racing Commission, has determined that for the first five-year period the amendments are in effect there will be no fiscal implications for state or local government.

Ms. Kennison has also determined that for each of the first five years the amendment is in effect the public benefit anticipated as a result of enforcing the proposal will be that the public can be assured that the Commission is protecting funds committed to small business persons, specifically the horsemen. There may be a slight increase of funds to small or micro businesses. There is no anticipated economic cost to an individual required to comply with the amendment as proposed. The proposal has no effect on the state's agricultural, horse breeding, horse training, greyhound breeding, or greyhound training industries.

Written comments must be submitted within 30 days after publication of the proposed amendment in the Texas Register to Judith L. Kennison, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711-2080, fax (512) 833-6907.

The amendments are proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorizes the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; and §6.06, which authorizes the Commission to adopt rules on all matters relating to the operation of pari-mutuel racetracks.

The proposed amendment implements Texas Civil Statutes, Article 179e.

§309.298.Stakes and Other Prepayment Races.

(a) An association shall file with the Commission, for approval, a copy of the race conditions and the nomination blank for all stakes or other prepayment races before distributing the conditions to the public.

(b) The nomination blank must state all conditions of the race, including:

(1) the payment schedule;

(2) the dates and conditions for the race and any trials;

(3) the source and amount of any added money;

(4) the distribution of all funds paid into the race, including the percentages allocated for advertising, administration, and other expenses , provided that no such expenses may be made or incurred by an association ;

(5) terms for obtaining refunds, if any; and

(6) all other conditions pertaining to the race.

(c) The association shall maintain one account in an F.D.I.C. secured financial institution, for which only funds received for stakes and other prepayment races may be deposited, except as otherwise authorized by these rules. The account must require, for all withdrawals, the signatures of two officers of the association.

(d) The association shall designate an official as the stakes nomination secretary who shall be responsible for the collection and deposit of all stakes, nomination, futurity and derby payments, preparation of the list of horses and their owners nominated for stakes, nomination, futurity and derby races and serving as the point of contact for the Commission staff for questions or information regarding stakes and other prepayment races. The association shall include the name of the person designated as the stakes nomination secretary in the list of officials prepared pursuant to §313.4 of this title (relating to Approval of Officials). The association shall include the person designated as the stakes nomination secretary in an insurance policy or fidelity bond covering employee dishonesty.

(e) Not later than five business days after receiving a request by the Commission, the association shall provide to the Commission a list of all horses nominated for the race, distinguishing which horses remain eligible as of the date of the request and the names of all owners of each horse remaining eligible.

(f) Not later than five business days after receiving a request by the Commission, the association shall provide a written report to the Commission regarding the activity and status of the escrow account in which the race funds are maintained. The report must include the name of the financial institution in which the account is held, the dates and amounts of deposits into the account by each nominator or sponsor, the dates and amounts of all withdrawals or deductions from the account, and for what purpose each withdrawal or deduction was made.

(g) Not later than five business days after receiving a request from the Commission, the horsemen's bookkeeper shall provide to the Commission the final report for the distribution of the purse for stakes and other prepayment races. The final report must state how the purse was distributed to each purse winner, including the address to which a check was mailed or the date on which winnings were deposited in the appropriate horsemen's account.

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 May 13, 2002.

TRD-200202965

Judith L. Kennison

General Counsel

Texas Racing Commission

Earliest possible date of adoption: June 23, 2002

For further information, please call: (512) 833-6699


Chapter 313. OFFICIALS AND RULES FOR HORSE RACING

Subchapter A. OFFICIALS

1. GENERAL PROVISIONS

16 TAC §313.5

(Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the Texas Racing Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The Texas Racing Commission proposes a repeal to §313.5, relating to complaints against officials. The repeal is necessary because the provision is duplicative and, therefore no longer necessary. The provision for complaints against officials is now located in Chapter 323 of the Rules.

Judith L. Kennison, General Counsel for the Texas Racing Commission, has determined that for the first five-year period the repeal is in effect there will be no fiscal implications for state or local government as a result of enforcing the proposal.

Ms. Kennison has also determined that for each of the first five years the rule is in effect the public benefit anticipated will be greater ease of use of the Commission rules. There will be no fiscal implications for small or micro-businesses. There is no anticipated economic cost to an individual required to comply with the amendment as proposed. The proposal has no effect on the state's agricultural, horse breeding, horse training, greyhound breeding, or greyhound training industries.

Written comments must be submitted within 30 days after publication of the proposed repeal in the Texas Register to Judith L. Kennison, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711-2080, fax (512) 833-6907.

The repeal is proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorizes the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; and Government Code, §2001.004, which requires the Commission to adopt rules of practice stating the nature and requirements of all available formal and informal procedures.

The repeal implements Texas Civil Statutes, Article 179e.

§313.5.Complaints against Officials.

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 May 13, 2002.

TRD-200202966

Judith L. Kennison

General Counsel

Texas Racing Commission

Earliest possible date of adoption: June 23, 2002

For further information, please call: (512) 833-6699


Subchapter D. RUNNING OF THE RACE

1. JOCKEYS

16 TAC §313.409

The Texas Racing Commission proposes an amendment to §313.409, related to jockey mount fees. The Texas Horsemen's Partnership petitioned the Commission for this amendment. The amendment would preclude the possibility of exposing the horsemen's bookkeeper to liability for duplicate payments by holding in escrow jockey mount fees in stakes races until the Commission has cleared the race for payment.

Judith L. Kennison, General Counsel for the Texas Racing Commission, has determined that for the first five-year period the amendment is in effect there will be no fiscal implications for state or local government as a result of enforcing the proposal.

Ms. Kennison has also determined that for each of the first five years the amendment is in effect the public benefit anticipated as a result of enforcing the proposal will be that the Commission rules are made clear and unambiguous. There will be no fiscal implications for small businesses or micro-businesses. There is no anticipated economic cost to an individual required to comply with the amendment as proposed. The proposal will have no effect on the state's agricultural, horse breeding, horse training, greyhound breeding, or greyhound training industries.

Written comments must be submitted within 30 days after publication of the proposed amendment in the Texas Register to Judith L. Kennison, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711-2080, fax (512) 833-6907.

The amendment is proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorizes the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; and §3.021, which authorizes the Commission to regulate all aspects of greyhound and horse racing in Texas.

The proposal implements Texas Civil Statutes, Article 179e.

§313.409.Jockey Mount Fees.

(a) - (f) (No change.)

(g) If the fee due to a jockey in a stakes race is $5,000 or more, the horsemen's bookkeeper may hold such fee in escrow until post-race testing is completed and action by the Commission releases the purse for that race, at which time the appropriate payment of the escrowed fee shall be made.

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 May 13, 2002.

TRD-200202967

Judith L. Kennison

General Counsel

Texas Racing Commission

Earliest possible date of adoption: June 23, 2002

For further information, please call: (512) 833-6699


Chapter 321. PARI-MUTUEL WAGERING

Subchapter B. TOTALISATOR REQUIREMENTS AND OPERATING ENVIRONMENT

2. OPERATIONAL REQUIREMENTS

16 TAC §321.124

The Texas Racing Commission proposes new §321.124, relating to waivers for technological advancement or off-site processing. The new rule will permit more flexibility when technical changes or changes in the totalisator environments occur. The rule will allow for waivers of certain requirements under the prescribed circumstances without the necessity of a rule change.

Judith L. Kennison, General Counsel for the Texas Racing Commission, has determined that for the first five-year period the amendments are in effect there will be no fiscal implications for state or local government as a result of enforcing the proposal.

Ms. Kennison has also determined that for each of the first five years the amendment is in effect the public benefit anticipated will be increased flexibility in the regulation of totalisator services. There will be no fiscal implications for small businesses or micro-businesses. There is no anticipated economic cost to an individual required to comply with the amendments as proposed. The proposal will have no effect on the state's agricultural, horse breeding, horse training, greyhound breeding, or greyhound training industries.

Written comments must be submitted within 30 days after publication of the proposed amendment in the Texas Register to Judith L. Kennison, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711-2080, fax (512) 833-6907.

The amendment is proposed under the Texas Civil Statutes, Article 179e, §3.02, which authorizes the Commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act; and §3.021, which authorizes the Commission to regulate all aspects of greyhound and horse racing in Texas.

The amendment implements Texas Civil Statutes, Article 179e.

§ 321.124.Waivers for Technological Advancement or Off-site Processing.

(a) Because the Commission and Comptroller recognize that technology and the locations for processing wagers change, an association or totalisator licensee may petition the Commission for a waiver of the Rules under this Chapter.

(b) To petition for a waiver under this section, the licensee must submit to the executive secretary a written application describing in detail the purpose, nature, duration, and extent of the requested waiver. The application must also include the process by which existing requirements of the system will be properly maintained.

(c) The Commission may not grant the waiver unless the Commission determines the requested waiver will not decrease the efficiency, speed, or accuracy of either the existing pari-mutuel wagering system or the Commission's audit function.

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 May 13, 2002.

TRD-200202968

Judith L. Kennison

General Counsel

Texas Racing Commission

Earliest possible date of adoption: June 23, 2002

For further information, please call: (512) 833-6699