TITLE 43.TRANSPORTATION

Part 1. TEXAS DEPARTMENT OF TRANSPORTATION

Chapter 11. DESIGN

Subchapter C. ACCESS CONNECTIONS TO STATE HIGHWAYS

43 TAC §§11.50 - 11.52, 11.55, 11.56

The Texas Department of Transportation (department) proposes amendments to §§11.50 - 11.52, §11.55 and new §11.56 concerning access driveways to state highways.

EXPLANATION OF PROPOSED AMENDMENTS AND NEW SECTION

Transportation Code, Chapter 203 provides that the Texas Transportation Commission (commission) may lay out, construct, maintain, and operate a modern state highway system. Access management is one method of preserving the substantial investment in the ground transportation system by preserving the roadway level of service.

Due to the significant cost associated with the construction and maintenance of highways, it is imperative that the highway system provide maximum traffic handling capacity and reasonable access for as long as practical. Adjacent development and uncontrolled access points along highways can contribute to congestion and early deterioration of the operation of the highway, thereby reducing the ability of the state highway system to safely and efficiently move higher volumes of traffic.

Access management is an engineering and planning method of balancing the needs of mobility and safety on a highway system with the needs of access to adjacent land. Access management can significantly enhance traffic safety by reducing traffic accidents, personal injury, and property damage. Access management promotes a more coordinated intergovernmental, long term approach to land use and transportation decisions in the context of quality of life, economic development, livable communities, and public safety.

Existing §§11.50 - 11.55 provide the current regulations for access driveways to state highways. Section 11.50 describes the purpose and need for access management. Section 11.51 includes definitions for public, commercial and private access driveways. Section 11.52 outlines the delegation of access permit authority to municipalities. Section 11.53 outlines the procedures for new access connection requests where the adjacent property has no existing right of access. Section 11.54 provides for the construction and maintenance of access connection facilities. Section 11.55 describes the procedures for the restoration of access using local access roads.

Section 11.50 is amended to clarify those prior commitments that will qualify specific access connection requests for exceptions.

Section 11.51 is amended to include definitions for "eligible counties," "executive director," and "regionally significant highways," and revisions to the definitions of "local access management plan" and "public driveway."

Transportation Code, §203.032 authorizes a county with a population of 3.3 million or more or a county adjacent to a county with a population of 3.3 million or more to adopt certain access-related orders applicable to state highways. Section 11.52 is amended to include eligible counties in the delegation of access permit authority. In addition, subsection 11.52(f) is amended to require compliance with the department's environmental review rules to address those situations in which federal law does not allow the department to delegate its environmental review requirements.

To expedite the process for providing local access roads, §11.55 is amended to change approval from the commission to the executive director for the department to enter into agreements to provide local access roads in conjunction with department projects.

New §11.56 is added to provide a uniform means by which public and private entities with the authority to construct, maintain, and operate regionally significant highway facilities may obtain permission to connect those facilities to the state highway system. While most such entities are required to obtain commission approval to construct regionally significant highways, certain entities with independent authority may construct regionally significant highways that do not necessarily conform to the Transportation Improvement Program (TIP). Adding regionally significant highways that are not in the TIP, especially in non-attainment areas, can threaten the entire area's transportation conformity under the federal Clean Air Act, resulting in sanctions that could severely hamper the state's federal highway program. The current rules govern connection to the state highway system, but do not give the department the ability to deny connections based on these conformity concerns, design and construction issues, or noncompliance with federal requirements. This new rule will ensure that proper statewide planning is employed in the construction of major highway facilities that connect to the state highway system, that the facilities are properly designed and constructed in compliance with federal laws, and that environmental impacts are adequately considered.

FISCAL NOTE

James Bass, Chief Financial Officer, has determined that for each of the first five years the amendments and new section as proposed are in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the amendments and new section. There are no anticipated economic costs for persons required to comply with the sections as proposed.

Mark A. Marek, Director, Design Division, has certified that there will be no significant impact on local economies or overall employment as a result of enforcing or administering the amendments and new section.

PUBLIC BENEFIT

Mr. Marek has also determined that for each year of the first five years the amendments and new section are in effect, the public benefits anticipated as a result of enforcing or administering the amendments and new section will be improved safety, mobility, and efficiency due to a more coordinated approach to land use and transportation decisions. There will be no adverse effect on small businesses.

SUBMITTAL OF COMMENTS

Written comments on the proposed amendments and new section may be submitted to Mark A. Marek, Director, Design Division, 125 East 11th Street, Austin, Texas 78701-2483. The deadline for receipt of comments is 5:00 p.m. on August 14, 2006.

STATUTORY AUTHORITY

The amendments and new section are proposed under Transportation Code, §201.101, which provides the commission with the authority to establish rules for the conduct of the work of the department, and more specifically Transportation Code, §203.032, which provides the commission with the authority to control access to highways.

CROSS REFERENCE TO STATUTE

Transportation Code, §203.032.

§11.50.Access Management.

(a) Purpose and need. Access management is an engineering and planning method of balancing the needs of mobility and safety on a highway system with the needs of access to adjacent land uses. Access management is one method of preserving the substantial public investment in the ground transportation system by preserving the roadway level of service. Further, access management can significantly enhance traffic safety by reducing traffic accidents, personal injury, and property damage. It has been noted that access management practices can promote a more coordinated intergovernmental, long term approach to land use and transportation decisions in the context of quality of life, economic development, livable communities, and public safety. Given the benefits to the ground transportation system and public safety, it is the intention of the department to promote the use of access management on the state highway system.

(b) Applicability. This subchapter applies to all new access connections constructed on highways on the state highway system. It also applies to existing access connections that may be reconstructed or otherwise modified as part of a department project.

(c) Effective date. The provisions of this subchapter are effective January 1, 2004.

(d) Transition period. Exceptions [ Prior to January 1, 2005, exceptions ] to the provisions of this subchapter may be granted for specific access connection requests where significant prior commitments have been made , prior to January 1, 2005, based on previous department policy.

§11.51.Definitions.

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

(1) Access connection--Facility for entry and/or exit such as a driveway, street, road, or highway that connects to a highway on the state highway system.

(2) Commercial driveway--An entrance to, or exit from, any commercial, business, or similar type establishment.

(3) Commission--The Texas Transportation Commission.

(4) Department--The Texas Department of Transportation.

(5) Eligible county--a county with a population of 3.3 million or more or a county adjacent to a county with a population of 3.3 million or more.

(6) [ (5) ] Engineering study--An appropriate level of analysis as determined by the department, which may include a traffic impact analysis, that determines the expected impact that permitting access will have on mobility, safety, and the efficient operation of the state highway system.

(7) Executive director--the executive director of the department, or a designee not below the level of deputy executive director or assistant executive director.

(8) [ (6) ] Local access management plan--A plan or guideline in a formally adopted [ municipality ] rule or ordinance that is related to the application of access management within the municipality's or eligible county's jurisdiction.

(9) [ (7) ] Local access road--A local public street or road, generally one parallel to a highway on the state highway system to which access for businesses or properties located between the highway and the local access road is provided as a substitute for access to the highway. A local access road may also be called a lateral road or reverse frontage road, depending on individual location and application.

(10) [ (8) ] Permittee--A property owner or its authorized representative who receives an access connection permit from the department to construct or modify an access connection from the property to a highway on the state highway system.

(11) [ (9) ] Private driveway--An entrance to or exit from a residential dwelling, farm, or ranch for the exclusive use and benefit of the permittee.

(12) [ (10) ] Public driveway--An approach from a publicly [ county or city ] maintained road or street or an entrance or exit from a public school, a publicly owned cemetery, or other publicly owned places or buildings that provide for public access.

(13) Regionally significant highway--A highway functionally classified as a minor arterial or higher.

(14) [ (11) ] Traffic impact analysis--A traffic engineering study to the level of analysis determined by the department that determines the potential current and future traffic impacts of a proposed traffic generator and is signed, sealed, and dated by an engineer licensed to practice in the state [ State ] of Texas.

§11.52.Delegation of Access Permit Authority to Municipalities or Eligible Counties .

(a) Intent. Except as provided in §11.56 of this subchapter (relating to Connection with Regionally Significant Highway, a [ A ] municipality or eligible county may include highways on the state highway system in its local access management plan. The intent of the department is to allow municipalities or eligible counties , upon request, to assume responsibility for issuing permits for access connections to state highways within the jurisdiction of the municipality or eligible county under a local access management plan when the municipality or eligible county has the ability to issue permits.

(b) Precedence. A local access management plan supersedes an order of the commission under Transportation Code, §203.031(a)(2) or (4) to the extent that they conflict, unless:

(1) the United States Department of Transportation Federal Highway Administration notifies the department that enforcement of the local access management plan would impair the ability of the state or the department to receive funds for highway construction or maintenance from the federal government; or

(2) the department owns the access rights.

(c) Application. The department will apply a local access management plan under this section when the municipality or eligible county provides its local access management plan to the department with an indication of its desire that the plan be applied within its jurisdiction and an implementation date. The department will implement any subsequent changes to the local access management plan when the municipality or eligible county submits the changes to the department with a proposed implementation date for the changes.

(d) Local access permitting function. A municipality or eligible county that desires to undertake the access permitting process on highways on the state highway system shall submit its proposed permitting procedures to the department. If the department determines that the proposed procedures adequately address the requirements in subsection (f) of this section, it will transfer to the municipality or eligible county the access permitting function within the municipality's or eligible county's jurisdiction. The municipality or eligible county shall submit to the department a copy of each approved access permit on the state highway system within ten working days of its approval.

(e) Assumption of permitting function optional. Municipalities or eligible counties are not required to take over the access permitting function for state highways within their jurisdiction.

(f) Engineering. Granting access location permit authority to municipalities or eligible counties does not preclude the need to properly engineer access locations. Any impacts to drainage or hydraulics on highways on the state highway system resulting from access connections must be coordinated with the department prior to any local access approval. Issuance of access permits by a municipality or eligible county must address driveway geometrics, utility location or relocation, compliance with the Americans with Disabilities Act (ADA) and Texas Accessibility Standards (TAS), [ environmental requirements, wetland considerations if appropriate, ] and all other applicable state and federal laws, rules, and regulations. In addition, each access connection must comply with the applicable environmental review requirements in Chapter 2 of this title (relating to Environmental Policy).

§11.55.Local Access Roads.

(a) If local access roads are necessary to restore circulation or to resolve a landlocked [ landlock ] condition on a remaining parcel of land, or will otherwise benefit the state highway system, local access roads may be included in a department project on a standard participation basis as established in Appendix A of §15.55 of this title (relating to Construction Cost Participation).

(b) Except as provided in §11.56 of this subchapter (relating to Connection with Regionally Significant Highway), executive director [ Commission ] approval must be obtained prior to the department entering into any agreements to provide local access roads in conjunction with a department project.

(c) Local access roads will not be considered service projects as defined in §15.56 of this title (relating to Local Financing of Highway Improvement Projects on the State Highway System).

§11.56.Connection with Regionally Significant Highway.

(a) Purpose. A public or private entity may not connect a regionally significant highway to a segment of the state highway system without the approval of the commission. This section prescribes the procedure by which the commission will consider approval.

(b) Request. An entity seeking approval under this section shall send a written request to the executive director. The request shall include a detailed schematic indicating the location of interchanges and mainlanes.

(c) Approval criteria.

(1) The commission will approve a connection requested under this section if:

(A) the highway is identified in a conforming Transportation Improvement Program;

(B) the requestor agrees to design and construct the project in compliance with subsection (d) of this section; and

(C) the requestor agrees to conduct public involvement and a study of the social, environmental, and economic impacts of the project in compliance with subsection (e) of this section.

(2) The commission may waive the requirements of paragraph (1)(B) of this subsection as they apply to the portion of the project that is not the connection if the commission determines that the past performance of the requestor on previous projects developed in collaboration with the department indicates that the requestor will design and construct a safe and durable highway. For purposes of this paragraph, the term "connection" includes an overpass, underpass, intersection, and interchange.

(3) The commission may waive the requirements of paragraph (1)(C) of this subsection if the commission determines that the requestor has a written policy that adequately provides for:

(A) public involvement, including public hearings on an environmental review;

(B) an evaluation of direct and indirect effects of the highway project;

(C) analysis of project alternatives; and

(D) a written report that briefly explains the requestor's decision on the project and that specifies the measures to mitigate environmental harm on which the project is conditioned.

(d) Design and construction. Except as provided in subsection (c)(2) of this section, the requestor shall design and construct the highway in accordance with §26.33(d), (f), and (g)-(1) of this title (relating to Design and Construction). For purposes of this subsection, the term RMA as used in §26.33 shall mean the requestor.

(e) Environmental review and public involvement.

(1) Environmental documentation.

(A) Subject to paragraph (4) of this subsection, a requestor shall prepare an environmental document in accordance with Chapter 2, Subchapter C, of this title (relating to Environmental Review and Public Involvement for Transportation Projects).

(B) The environmental document must describe all reasonable and feasible measures to avoid, minimize, or mitigate for adverse environmental impacts and all practicable measures to enhance the environment.

(C) The form and content of an environmental document prepared by a requestor and any decision by a requestor that an environmental impact statement is not necessary must be approved by the department.

(2) Public involvement. Subject to paragraph (4) of this subsection, a requestor shall provide for public involvement by:

(A) complying with §2.43(c) of this title (relating to Non Federal-Aid Transportation Projects);

(B) holding one or more public hearings following the completion of the studies required by this section as may be necessary to ensure participation by each community affected by the project; and

(C) notifying the department in writing not less than ten days in advance of all public meetings and public hearings held under this section.

(3) Revision to environmental document. Following the public hearing, a requestor shall revise the environmental document showing the proposed changes in the project location, design, and mitigation as a result of comments and the public involvement process for the project to address any issues or concerns identified during the public involvement process.

(4) Respective roles and responsibilities. The requestor shall request that the department make a determination of the respective roles and responsibilities of the requestor and the department under Chapter 2, Subchapter C, of this title (relating to Environmental Review and Public Involvement for Transportation Projects). The requestor shall comply with the department's directives. The directives will specify who will conduct the following work, the requestor or the department:

(A) preparation and completion of environmental studies;

(B) submission of appropriate environmental documentation for department review;

(C) preparation of any document revisions;

(D) submission of copies of the environmental studies and documentation adequate for distribution;

(E) preparation of legal and public notices for department review and use;

(F) arrangements for appropriate public involvement, including court reporters and accommodations if requested for persons with special communication or physical needs related to public hearings;

(G) preparation of public meetings and hearing materials;

(H) preparation of any responses to comments;

(I) preparation of public meeting and public hearing summary and analysis, and the comment and response reports; and

(J) submission of documentation showing all environmental permits, issues, and commitments have been or will be completed, including copies of permits or other approvals required prior to construction.

(5) Record. Subject to paragraph (4) of this subsection, a requestor shall provide the department:

(A) the appropriate environmental document;

(B) summary and comment and response reports for all meetings;

(C) summary and analysis and comment and response reports for all public hearings;

(D) a summary of the proposed changes in the project location and design and mitigation planned as a result of comments;

(E) the verbatim transcript of any public hearing;

(F) certification that all public hearings were held in accordance with §2.43 of this title (relating to Non Federal-Aid Transportation Projects), the Civil Rights Act of 1964, and the Civil Rights Restoration Act of 1987; and

(G) revised environmental document showing the proposed changes in project location, design, and mitigation as a result of comments and public involvement.

(6) This subsection does not apply if the commission has approved a waiver under subsection (c)(3) of this section.

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 June 30, 2006.

TRD-200603533

Richard D. Monroe

General Counsel

Texas Department of Transportation

Earliest possible date of adoption: August 13, 2006

For further information, please call: (512) 463-8683

Chapter 17. VEHICLE TITLES AND REGISTRATION

Subchapter B. MOTOR VEHICLE REGISTRATION

43 TAC §17.28

The Texas Department of Transportation (department) proposes amendments to §17.28, concerning specialty license plates, symbols, tabs, and other devices.

Transportation Code, §504.801 authorizes the department to create new specialty license plates, either on its own initiative or upon receipt of an application from an organization or individual. In 2004, administrative rules were adopted for the implementation of Transportation Code, §504.801. These amendments revise §17.28(i), Development of new specialty license plates, to clarify the procedures for the specialty license plate committee (committee), the application process, and issuance of new specialty license plates.

Throughout the proposed rule, nonsubstantive changes in language are made to correct terminology and enhance readability.

Section 17.28(i)(1)(A) is amended to specify that the committee shall review all completed specialty license plate applications. Applications that are not complete will not be considered by the committee.

Section 17.28(i)(1)(C) is added to provide the criteria the committee will utilize for recommending a proposed specialty license plate.

Section 17.28(i)(1)(D) is amended to require posting on the department's website of the proposed specialty license plates recommended by the committee. The number of days for a proposed specialty license plate to be posted for public comment period is amended from 30 to 10 days. These timeframes establish consistency with Transportation Code, §504.851, Contract with Private Vendor. The license plate design is also added to the website notice.

New §17.28(i)(1)(E) is added to specify that specialty license plate applications that are restricted to certain individuals or groups of individuals (qualifying plates) will be reviewed by the committee utilizing the same procedures as applications submitted for plates that are available to everyone (non-qualifying plates).

Section 17.28(i)(2)(A) is amended to list the items that are required as part of the application. The new language clarifies that the certification for the not-for-profit status must be on a form provided by the Internal Revenue Service on that department's letterhead.

The amendments also provide that the application needs to identify the projected sales and a marketing plan for the plate. The department has found it difficult to adequately review applications if the application only includes an estimate of potential plate sales. By requiring the applicant to include information regarding their marketing plan and information on the types or groups of individuals that will be interested in purchasing the plate, the department will be better able to determine if the projected sales will meet the deposit requirement.

The new language also requires the signature of the executive director of the sponsoring state agency. This requirement is to insure the sponsoring agency is fully aware of their participation in the program. In addition, the letter must state that the funds will be used for a lawful purpose.

Section 17.28(i)(2)(B) is amended to clarify the application process. The amended language requires that the committee has the authority to request additional information if necessary to make a decision on the application. Further, the new language requires that if additional information is requested the decision on the application will be postponed until the next committee meeting. If the additional information is not received the application will be considered incomplete and will not be reviewed by the committee. The executive director is the final approval authority of a specialty license plate application and the criteria on which the decision is based is identified. An applicant whose application is not approved by the executive director must submit a new application to be considered again by the committee. The committee will no longer hold applications and continue to review those held applications in each successive meeting.

Section 17.28(i)(3) is amended to specify that the department has the final approval of all specialty license plate designs.

Section 17.28(i)(4) language pertaining to the redesign of specialty license plates is amended to require the redesign to go through the application and approval process. An approved redesign will not require the $15,000 deposit as required by Transportation Code, §504.702. The redesign does however require the payment of administrative costs associated with the redesign.

FISCAL NOTE

James Bass, Chief Financial Officer, has determined that for each of the first five years the amendments as proposed are in affect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the amendments. There are no anticipated economic costs for persons required to comply with the section as proposed.

Rebecca Davio, Director, Vehicle Titles and Registration Division, has certified that there will be no significant impact on local economies or overall employment as a result of enforcing or administering the amendments.

PUBLIC BENEFIT

Ms. Davio has also determined that for each year of the first five years the section is in effect, the public benefit anticipated as a result of enforcing or administering the amendments will be providing non-profit entities the policies and procedures necessary for obtaining a specialty license plate for their organization and thus enhancing the customer service level of the department. There will be no adverse economic effect on small businesses.

SUBMITTAL OF COMMENTS

Written comments on the proposed amendments may be submitted to Rebecca Davio, Director, Vehicle Titles and Registration Division, Texas Department of Transportation, 125 East 11th Street, Austin, Texas 78701-2483. The deadline for receipt of comments is 5:00 p.m. on August 14, 2006.

STATUTORY AUTHORITY

The amendments are proposed under Transportation Code, §201.101, which provides the commission with the authority to establish rules for the conduct of the work of the department, and more specifically, Transportation Code, §504.004, which allows the department to adopt rules to administer Transportation Code, Chapter 504, governing the issuance of specialty license plates.

CROSS REFERENCE TO STATUTE

Transportation Code, §504.801.

§17.28.Specialty License Plates, Symbols, Tabs, and Other Devices.

(a) - (h) (No change.)

(i) Development of new specialty license plates.

(1) Procedure. The following procedure governs the process of authorizing [ issuance of ] new specialty license plates under Transportation Code, §504.801. It applies whether the new license plate originated as a result of an application or on the department's own initiative.

(A) The executive director will appoint no fewer than three employees of the department to a specialty license plate committee. The [ license plate ] committee shall meet at least once every six months and shall review all completed specialty license plate applications [ tentatively decide to issue or not issue all proposed specialty license plates ].

(B) The [ license plate ] committee may request additional information from an applicant if necessary to reach a [ the additional information would be relevant to the ] decision [ whether or not to issue the proposed license plate ].

(C) The recommendation of the committee will be based on the following:

(i) the projected sales of the license plate as demonstrated in the marketing plan and by the listing of target purchasers;

(ii) compliance with Transportation Code, §504.801; and

(iii) other information provided during the application process.

(D) [ (B) ] If the [ license plate ] committee recommends the issuance of [ tentatively decides to issue ] a proposed specialty license plate, notice of the proposed new license plate will be published in the Texas Register and the license plate design will be posted on the department's web site to receive public [ for ] comment. Comments must be received 10 days from the date the notice is published in the Texas Register [ The comment period shall be no less than 30 days ].

[ (C) If the license plate committee tentatively decides not to issue a proposed specialty license plate, the director of the Vehicle Titles and Registration Division shall forward the committee's tentative decision to the executive director or the executive director's designee, who will decide not to issue the proposed specialty license plate or will decide tentatively to issue the proposed specialty license plate. If the decision is tentatively made to issue the proposed specialty license plate, notice will be published in the Texas Register and the department's web site under subparagraph (B) of this paragraph. ]

[ (D) After notice of a proposed specialty license plate is published and the comment period has expired, the director will make a recommendation to the executive director or the executive director's designee, who will decide whether to issue the proposed license plate. ]

(E) Specialty license plate applications that are restricted to certain individuals or groups of individuals (qualifying plates) will be reviewed by the committee using the same procedures as applications submitted for plates that are available to everyone (non-qualifying plates). The limited number of potential purchasers will be a factor in the approval decision.

(2) Applications for the creation of new specialty license plates.

(A) Requirements. To apply for the creation of a new specialty license plate, an applicant must submit a written application [ . The application must be ] on a form approved by the director . The application shall include [ and include, at a minimum ]:

(i) the applicant's name, address, telephone number, and other identifying information as directed on the form;

(ii) a current certification provided by the Internal Revenue Service on that department's letterhead, stating that the applicant is a not-for-profit enterprise; [ and ]

(iii) a draft design of the specialty license plate ; [ . ]

(iv) projected sales of the plate, including an explanation of how the projected figure was established;

(v) a marketing plan for the plate including a description of the target market;

[ (B) Optional information. An applicant for the creation of a new specialty license plate may also include: ]

[ (i) a proposed distribution of fees; and ]

(vi) [ (ii) ] a letter from the executive director of the [ a ] sponsoring state agency stating that the agency agrees to receive and distribute revenues from the specialty license plate and that the use of the funds will not violate a statute or constitutional provision; and

(vii) other information necessary for the committee to reach a decision regarding approval of the requested specialty plate .

(B) [ (C) ] Application Process [ Procedure ].

(i) The application must be complete to be considered by the committee [ to create a new specialty license plate must be submitted on a form prescribed by the director ].

(ii) If the committee reviews an application and determines that additional information is needed from the applicant that may contribute to the application decision, the decision on the application will be postponed until the next committee meeting.

(iii) If the additional requested information is not received prior to the next committee meeting the application will not be considered and will be returned to the applicant as incomplete.

(iv) The executive director will make the final decision on the specialty license plate application based on the committee's recommendation and the comments received during the posting period.

(v) An applicant whose application is not approved by the executive director must submit a new application and supporting documentation to be considered again by the committee.

(3) Issuance of specialty plates.

(A) If the specialty license plate is approved [ If the department decides to issue the new specialty license plate ], the applicant must comply with Transportation Code, §504.702[ , ] before any further design and processing of the license plate.

(B) Approval of the plate does not guarantee that the submitted draft plate design will be used. The department has final approval of all specialty license plate designs and can adjust or reconfigure the submitted draft design to comply with the format of the license plate specifications.

(4) [ (3) ] Redesign of specialty license plate.

(A) At the request of the original or subsequent applicant, the department may redesign a specialty license plate.

(B) A request for a new design will go through the application and approval process required by this subsection.

(C) An approved license plate redesign does not require the full deposit required by Transportation Code, §504.702.

(D) The original or subsequent applicant will pay a [ all ] redesign cost to cover administrative expenses [ costs ]. [ The department's decision will be based on the cost to the public of redesigning the license plate and will consider the amount of any preprinted sheeting remaining and other administrative costs. ]

(j) (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 June 30, 2006.

TRD-200603534

Richard D. Monroe

General Counsel

Texas Department of Transportation

Earliest possible date of adoption: August 13, 2006

For further information, please call: (512) 463-8683

Chapter 18. MOTOR CARRIERS

The Texas Department of Transportation (department) proposes amendments to §18.2, §18.13, §18.14, §18.16, and §18.32 concerning motor carrier definitions, registration, records, and inspections.

EXPLANATION OF PROPOSED AMENDMENTS

The proposed amendments are necessary to implement the provisions of House Bill 2702 of the 79th Legislature, Regular Session, 2005. House Bill 2702, Article 6, amended Transportation Code, §643.051, Registration Requirements, to require all household good movers to register as motor carriers regardless of the weight of the vehicles they operate. The bill also deleted the alternative registration requirements for household goods carriers under Transportation Code, §643.153, Motor Carriers Transporting Household Goods. All household goods carriers must now register under the general motor carrier registration regardless of the size of vehicles they operate. The statutory changes eliminated the need for "Type A" and "Type B" household goods carrier classifications.

These amendments were initially proposed November 17, 2005, along with other rules regarding motor carrier registration issues. These amendments were removed from the rules as adopted during the April 27, 2006, Texas Transportation Commission (commission) meeting to allow the department time to further study the issue of minimum vehicle liability insurance requirements for household goods carriers who operate vehicles weighing 26,000 pounds or less. However, due to a clerical error the language filed with the Texas Register on April 28, 2006, for §18.16(a) Figure 1 was not amended to reflect the language adopted by the commission. The language in Figure 1, regarding the minimum liability insurance level for household goods carriers under 26,000 pounds was not approved by the commission and is not being enforced by the department. The language now being proposed for Figure 1 is the same language that is currently published in 43 TAC §18.16(a).

To study the minimum liability insurance issues, the department has contacted other states, gathered insurance information, reviewed traffic accident studies, contacted the Texas Department of Public Safety and the Department of Insurance regarding vehicle loss records, contacted the Federal Motor Carrier Safety Administration concerning crash data, collected data from the National Institute for Occupational Safety and Health and Insurance Institute for Highway Safety, and conducted a public hearing. The information gathered from these resources was used to draft these proposed amendments.

Throughout the proposed rules, all references to "Type A" and "Type B" household goods carriers are deleted.

The definition for "Type B" household goods carrier has been deleted from §18.2 as it is no longer necessary under Transportation Code, Chapter 643.

Amended language in §18.13(i) deletes the reference to the alternative registration process for Type B carriers. These alternatives are no longer authorized by the statute due to the changes in Transportation Code, §643.051 and §643.153.

Section 18.16(a), relating to automobile liability insurance requirements, is amended to establish a minimum liability insurance requirement for vehicles weighing 26,000 pounds or less that are operated by household goods carriers as required by the statutory changes. Transportation Code, §643.101 requires that a motor carrier required to register under Subchapter B shall maintain liability insurance in an amount set by the department for each vehicle requiring registration the carrier operates. Pursuant to Transportation Code, §643.101(b), the department is to consider the class and size of the vehicle and the persons or cargo transported in setting the insurance requirement. The rules set the minimum level of liability insurance for household goods carriers with gross weight of 26,000 pounds or less at $300,000 combined single limit (CSL). This figure was selected based on the research conducted by the Motor Carrier Division, which is summarized below.

In 1995 the department required motor carriers to maintain a minimum liability insurance of $500,000 CSL for commercial vehicles over 26,000 pounds operated in Texas. Household goods carriers operating vehicles 26,000 pounds or less were not required to register as motor carriers under the same provisions and therefore, the department was not required to establish a minimum insurance requirement. These types of household goods carriers were required to maintain the minimum liability insurance levels required of all vehicles under Transportation Code, §601.072. Transportation Code, §601.007 exempts vehicles that are required to register under Transportation Code, §643.051 from the liability requirements of Transportation Code, Chapter 601.

Pursuant to Transportation Code, Chapter 601, the state mandated minimum insurance coverage for vehicles that are not required to register under the motor carrier provisions is $20,000 for bodily injury or death to one person, $40,000 for bodily injury or death to two or more persons, and $15,000 for property damage. This minimum level of insurance is inadequate for a regulated commercial activity.

A look at 16 states revealed that only Florida has lower requirements than the current liability insurance limit for household goods carriers weighing 26,000 pounds or less. Several states have set their minimum limits by using the existing federal requirements. The federal regulations found at 49 CFR §387.303 set the minimum vehicle liability insurance amounts for motor carriers operating in interstate commerce by weight of the vehicle. The federal regulations require vehicles weighing under 10,000 pounds to have a minimum of $300,000 CSL. Vehicles weighing over 10,000 pounds have a minimum federal limit of $750,000 CSL. The department's proposed rule that requires household goods carriers operating vehicles weighing 26,000 pounds or less, intrastate only, to carry a $300,000 CSL liability insurance policy complies with the state statute which mandates that the minimum liability levels not exceed the federal requirements.

Large amounts of crash data are available, but the department was unable to find any accident rate studies specific to household goods carriers; therefore, very limited financial loss information is available. National statistics between 1975-2004 support that vehicles weighing 26,000 pounds or less incur as high an incident rate as do the larger trucks. The Insurance Institute for Highway Safety shows that while the death rate for occupants in passenger cars has declined 12% in the last 30 years the death rate for occupants in light trucks has increased 57%. This indicates that light trucks are involved in serious accidents that result in significant loss to the injured party. The existing minimum liability insurance requirements of Transportation Code, §601.072, are not sufficient to cover the costs of the at-fault party involved in a serous accident.

As stated the language setting the minimum liability insurance at $300,000 was incorrectly included in the adoption filed April 28, 2006. This amendment proposes the same language and provides the justification for how the minimum liability insurance level was selected.

Proposed amendments to §18.32(c) delete information regarding where and how Type B household goods carriers must carry registration certificates.

FISCAL NOTE

James Bass, Chief Financial Officer, has determined that for each year of the first five years the amendments as proposed are in effect, there will be minimal fiscal implications for state or local governments as a result of enforcing or administering the amendments. There may be a moderate economic cost for persons required to comply with the sections as proposed. The fiscal impact is due to the establishment of a new minimum liability insurance requirement as required by recently enacted legislation.

The possible economic cost to persons who are required to comply with the rule as proposed will be as follows. It is anticipated that, during the next five fiscal years, annual liability insurance premiums will be approximately 39% higher than the current rates. This figure is based on estimates the department received from insurance agents questioned during the drafting of the proposed amendments. Due to the many factors that affect insurance premiums it is difficult to give a firm premium figure. Some of the factors used to set the insurance premium include: location, type of vehicle, loss history, financial strength, longevity of the business, and safety procedures. Each of these factors can have a substantial impact to either decrease or increase the actual premium, therefore, the department's estimate of 39% will not necessarily translate to the cost of the additional insurance for the entities required to comply with these provisions. In addition, it is unknown if these entities currently carry only the minimum liability insurance required. The department received information during the public hearing that many household goods carriers maintained liability insurance in amounts above that required by rule.

Carol Davis, Director, Motor Carrier Division, has certified that there will be no impact on local economies or overall employment as a result of enforcing or administering the amendments.

PUBLIC BENEFIT

Ms. Davis has also determined that for each of the first five years the sections are in effect, the public benefit anticipated as a result of enforcing or administering the amendments will be the implementation of the legislation referenced in this preamble and increased protection to the traveling public. The costs involved for those involved in vehicle accidents include medical expenses and property damage. Additional insurance coverage is needed to offset the potential economic loss to the general public involved in an accident with household goods carriers.

There will be a moderate economic effect on small businesses. The department has reviewed the requirements of Government Code, §2006.002 and has determined that it is not feasible, considering the purpose of the statute under which these rules are proposed, to reduce the effect on small and micro-businesses. Transportation Code, §643.051 was amended to require all household goods carriers comply with the same motor carrier registration requirements. To provide an alternative reporting system, establish a separate compliance process, or exempt small and micro businesses from the requirements would be in effect returning to the process in place prior to the statutory change.

The insurance estimates obtained by the department show a $367 increase in the annual liability premium per vehicle as a result of raising the minimum requirement from $55,000 CSL to $300,000 CSL. Based on this figure the department has determined that a household goods carrier operating three vehicles weighing 26,000 pounds or less will have an approximately $1,100 annual increase in liability insurance premiums. A household goods carrier operating seven vehicles weighing 26,000 pounds or less will have an approximately $2,600 annual increase and a carrier with twenty-five vehicles will have an approximately $9,200 annual increase in premiums.

The cost of complying with the provisions of this rule will affect both large and small businesses. The costs were estimated on the insurance premium for each vehicle operated by the company. Large companies operating vehicles that weigh 26,000 pounds or less will likely see the highest increase in costs.

PUBLIC HEARING

Pursuant to the Administrative Procedure Act, Government Code, Chapter 2001, the Texas Department of Transportation will conduct a public hearing to receive comments concerning the proposed rules. The public hearing will be held at 9:00 a.m. on August 1, 2006, in the first floor hearing room of the Dewitt C. Greer State Highway Building, 125 East 11th Street, Austin, Texas and will be conducted in accordance with the procedures specified in 43 TAC §1.5. Those desiring to make comments or presentations may register starting at 8:30 a.m. Any interested persons may appear and offer comments, either orally or in writing; however, questioning of those making presentations will be reserved exclusively to the presiding officer as may be necessary to ensure a complete record. While any person with pertinent comments will be granted an opportunity to present them during the course of the hearing, the presiding officer reserves the right to restrict testimony in terms of time and repetitive content. Organizations, associations, or groups are encouraged to present their commonly held views and identical or similar comments through a representative member when possible. Comments on the proposed text should include appropriate citations to sections, subsections, paragraphs, etc. for proper reference. Any suggestions or requests for alternative language or other revisions to the proposed text should be submitted in written form. Presentations must remain pertinent to the issues being discussed. A person may not assign a portion of his or her time to another speaker. Persons with disabilities who plan to attend this meeting and who may need auxiliary aids or services such as interpreters for persons who are deaf or hearing impaired, readers, large print or Braille, are requested to contact Randall Dillard, Director, Public Information Office, 125 East 11th Street, Austin, Texas 78701-2483, (512) 463-8588 at least two working days prior to the hearing so that appropriate services can be provided.

SUBMITTAL OF COMMENTS

Written comments on the amendments may be submitted to Carol Davis, Director, Motor Carrier Division, Texas Department of Transportation, 125 East 11th Street, Austin, Texas 78701-2483. The deadline for receipt of comments is 5:00 p.m. on August 14, 2006.

Subchapter A. GENERAL PROVISIONS

43 TAC §18.2

STATUTORY AUTHORITY

The amendments are proposed under Transportation Code, §201.101, which provides the commission with the authority to establish rules for the conduct of the work of the department, and more specifically, Transportation Code, §643.003, which authorizes the department to adopt rules to administer Chapter 643 regarding motor carrier registration.

CROSS REFERENCE TO STATUTE

Transportation Code, Chapter 643.

§18.2.Definitions.

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

(1) Approved association--A group of household goods carriers, its agents, or both, that has an approved collective ratemaking agreement on file with the department under §18.64 of this chapter.

(2) Binding proposal--A formal written offer stating the exact price for the transportation of specified household goods and any related services.

(3) Certificate of insurance--A certificate prescribed by and filed with the department in which an insurance carrier or surety company warrants that a motor carrier for whom the certificate is filed has the minimum coverage as required by §18.16 and §18.86 of this chapter.

(4) Certificate of registration--A certificate issued by the department to a motor carrier and containing a unique number.

(5) Certified scale--Any scale designed for weighing motor vehicles, including trailers or semitrailers not attached to a tractor, and certified by an authorized scale inspection and licensing authority. A certified scale may also be a platform-type or warehouse-type scale properly inspected and certified.

(6) Commercial motor vehicle--

(A) Includes:

(i) any motor vehicle or combination of vehicles with a gross weight, registered weight, or gross weight rating in excess of 26,000 pounds, that is designed or used for the transportation of cargo in furtherance of any commercial enterprise;

(ii) all tow trucks, regardless of the gross weight rating of the tow truck;

(iii) any vehicle, including buses, designed or used to transport more than 15 passengers, including the driver;

(iv) any vehicle used in the transportation of hazardous materials in a quantity requiring placarding under the regulations issued under the federal Hazardous Materials Transportation Act (49 USC, App. §§1801-1813);

(v) a commercial motor vehicle, as defined by 49 CFR §390.5, owned or controlled by a person or entity that is domiciled in or a citizen of a country other than the United States; and

(vi) any vehicle transporting household goods for compensation, regardless of the gross weight rating, registered weight or gross weight.

(B) Does not include:

(i) a farm vehicle with a gross weight, registered weight, and gross weight rating of less than 48,000 pounds;

(ii) cotton vehicles registered under Transportation Code, §504.505;

(iii) a vehicle registered with the Railroad Commission under [ Texas ] Natural Resources Code, §113.131 and §116.072;

(iv) a vehicle transporting liquor under a private carrier permit issued in accordance with Alcoholic Beverage Code, Chapter 42;

(v) a motor vehicle used to transport passengers and operated by an entity whose primary function is not the transportation of passengers, such as a vehicle operated by a hotel, day-care center, public or private school, nursing home, or similar organization;

(vi) a motor vehicle registered under the Single State Registration System established under 49 USC §14504 when operating exclusively in interstate or international commerce; and

(vii) a vehicle operated by a governmental entity.

(7) Commercial school bus--A motor vehicle owned by a motor carrier that is:

(A) registered under Transportation Code, Chapter 643, Subchapter B;

(B) operated exclusively within the boundaries of a municipality and used to transport preprimary, primary, or secondary school students on a route between the students' residences and a public, private, or parochial school or daycare facility;

(C) operated by a person who holds a driver's license or commercial driver's license of the appropriate class for the operation of a school bus;

(D) complies with Transportation Code , Chapter 548; and

(E) complies with Transportation Code, §521.022.

(8) Commission--The Texas Transportation Commission.

(9) Consent tow--Any tow of a motor vehicle initiated by the owner or operator of the vehicle or by a person who has possession, custody, or control of the vehicle. The term does not include a tow of a motor vehicle initiated by a peace officer investigating a traffic accident or a traffic incident that involves the vehicle.

(10) Conspicuous--Written in a size, color, and contrast so as to be readily noticed and understood.

(11) Conversion--A change in an entity's organization that is implemented with a Certificate of Conversion issued by the Texas Secretary of State under Texas Business Corporation Act, Article 5.18.

(12) Department--Texas Department of Transportation.

(13) Director--The director of the Motor Carrier Division, Texas Department of Transportation.

(14) Division--The Motor Carrier Division.

(15) DOI--Texas Department of Insurance.

(16) Estimate--An informal oral calculation of the approximate price of transporting household goods.

(17) Farmer--A person who operates a farm or is directly involved in cultivating land or in raising crops or livestock that are owned by or are under the direct control of that person.

(18) Farm vehicle--Any vehicle or combination of vehicles controlled or operated by a farmer or rancher being used to transport agriculture products, farm machinery, and farm supplies to or from a farm or ranch.

(19) Gross weight rating--The maximum loaded weight of any combination of truck, tractor, and trailer equipment as specified by the manufacturer of the equipment. If the manufacturer's rating is unknown, the gross weight rating is the greater of:

(A) the actual weight of the equipment and its lading; or

(B) the maximum lawful weight of the equipment and its lading.

(20) Household goods--Personal property intended ultimately to be used in a dwelling when the transportation of that property is arranged and paid for by the householder or the householder's representative. The term does not include personal property to be used in a dwelling when the property is transported from a manufacturing, retail, or similar company to a dwelling if the transportation is arranged by a manufacturing, retail, or similar company.

(21) Household goods agent--A motor carrier who transports household goods on behalf of another motor carrier.

(22) Household goods carrier--A motor carrier who transports household goods for compensation or hire in furtherance of a commercial enterprise.

(23) Insurer--A person, including a surety, authorized in this state to write lines of insurance coverage required by Subchapter B and Subchapter G of this chapter.

(24) Inventory--A list of the items in a household goods shipment and the condition of the items.

(25) Leasing business--A person that leases vehicles requiring registration under Subchapter B of this chapter to a motor carrier that must be registered.

(26) Manager--The manager of the department's Motor Carrier Division, Motor Carrier Operations Section.

(27) Mediation--A non-adversarial form of alternative dispute resolution in which an impartial person, the mediator, facilitates communication between two parties to promote reconciliation, settlement, or understanding.

(28) Motor Carrier or carrier--A person that controls, operates, or directs the operation of one or more vehicles that transport persons or cargo over a public highway in this state.

(29) Motor transportation broker--A person who sells, offers for sale, or negotiates for the transportation of cargo by a motor carrier operated by another person or a person who aids and abets another person in selling, offering for sale, or negotiating for the transportation of cargo by a motor carrier operated by another person.

(30) Moving services contract--A contract between a household goods carrier and shipper, such as a bill of lading, receipt, order for service, or work order, that sets out the terms of the services to be provided.

(31) Multiple user--An individual or business who has a contract with a household goods carrier and who used the carrier's services more than 50 times within the preceding 12 months.

(32) Nonconsent tow--Any tow of a motor vehicle that is not a consent tow.

(33) Not-to-exceed proposal--A formal written offer stating the maximum price a shipper can be required to pay for the transportation of specified household goods and any related services. The offer may also state the non-binding approximate price. Any offer based on hourly rates must state the maximum number of hours required for the transportation and related services unless there is an acknowledgment from the shipper that the number of hours is not necessary.

(34) Principal place of business--A single location that serves as a motor carrier's headquarters and where it maintains its operational records or can make them available.

(35) Public highway--Any publicly owned and maintained street, road, or highway in this state.

(36) Reasonable dispatch--The performance of transportation, other than transportation provided under guaranteed service dates, during the period of time agreed on by the carrier and the shipper and shown on the shipment documentation. This definition does not affect the availability to the carrier of the defense of force majeure.

(37) Registration receipt--A receipt issued to the registrant by its registration state after the requirements of 49 CFR[ , ] Part 367 have been met.

(38) Registration state--A state where the registrant maintains a valid single state registration as defined in 49 CFR[ , ] Part 367.

(39) Replacement vehicle--A vehicle that takes the place of another vehicle that has been removed from service.

(40) Revocation--The withdrawal of registration and privileges by the department or a registration state.

(41) Shipper--The owner of household goods or the owner's representative.

(42) Short-term lease--A lease of 30 days or less.

(43) Single state registration system--The program established by 49 USC §14504.

(44) SOAH--The State Office of Administrative Hearings.

(45) State of travel--A state in which a motor carrier operates motor vehicles subject to the single state registration system.

(46) Substitute vehicle--A vehicle that is leased from a leasing business and that is used as a temporary replacement for a vehicle that has been taken out of service for maintenance, repair, or any other reason causing the temporary unavailability of the permanent vehicle.

(47) Suspension--Temporary removal of privileges granted to a registrant by the department or a registration state.

(48) Towing company--A motor carrier that transports vehicles using a tow truck.

(49) Tow--The utilization of a mechanical device used to winch or otherwise move another vehicle.

(50) Tow truck--A motor vehicle equipped with or used in combination with a mechanical device used to tow, winch, or otherwise move another vehicle. The following motor vehicles are not considered tow trucks:

(A) a motor vehicle owned and used exclusively by a governmental entity, including a public school district;

(B) a motor vehicle towing:

(i) a race car;

(ii) a motor vehicle for exhibition; or

(iii) an antique motor vehicle;

(C) a recreational vehicle towing another vehicle;

(D) a motor vehicle used in combination with a tow bar, tow dolly, or other mechanical device if the vehicle is not operated in the furtherance of a commercial enterprise; or

(E) a motor vehicle that is controlled or operated by a farmer or rancher and that is used for towing a farm vehicle.

[ (51) Type B household goods carrier--A household goods carrier that does not use a motor vehicle or combination of vehicles with a gross weight, registered weight, or gross weight rating in excess of 26,000 pounds. ]

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 June 30, 2006.

TRD-200603535

Richard D. Monroe

General Counsel

Texas Department of Transportation

Earliest possible date of adoption: August 13, 2006

For further information, please call: (512) 463-8683

Subchapter B. MOTOR CARRIER REGISTRATION

43 TAC §§18.13, 18.14, 18.16

STATUTORY AUTHORITY

The amendments are proposed under Transportation Code, §201.101, which provides the Texas Transportation Commission with the authority to establish rules for the conduct of the work of the department, and more specifically, Transportation Code, §643.003, which authorizes the department to adopt rules to administer Chapter 643 regarding motor carrier registration.

CROSS REFERENCE TO STATUTE

Transportation Code, Chapter 643.

§18.13.Application for Motor Carrier Registration.

(a) Form of application. An application for motor carrier registration must be filed with the department's Motor Carrier Division and [ except as provided in subsection (i) of this section, ] must be in the form prescribed by the director and must contain, at a minimum, the following information.

(1) Business or trade name. The applicant must designate the business or trade name of the motor carrier.

(2) Owner name. If the motor carrier is a sole proprietorship, the owner must indicate the name and social security number of the owner. A partnership must indicate the partners' names, and a corporation must indicate principal officers and titles.

(3) Principal place of business. A motor carrier must disclose the motor carrier's principal business address. If the mailing address is different from the principal business address, the mailing address must also be disclosed.

(4) Legal Agent.

(A) A Texas-domiciled motor carrier must provide the name and address of a legal agent for service of process if the agent is different from the motor carrier.

(B) A motor carrier domiciled outside Texas must provide the name and Texas address of the legal agent for service of process.

(C) A legal agent for service of process shall be a Texas resident, a domestic corporation, or a foreign corporation authorized to transact business in Texas with a Texas address for service of process.

(5) Description of vehicles. An application must include a motor carrier equipment report identifying each commercial motor vehicle that requires registration and that the carrier proposes to operate. Each commercial motor vehicle must be identified by its motor vehicle identification number, make, model year, and type of cargo and by the unit number assigned to the commercial motor vehicle by the motor carrier. Any subsequent registration of vehicles must be made under subsection (e) of this section.

(6) Type of motor carrier operations. An applicant must state if the applicant:

(A) proposes to transport passengers, household goods, or hazardous materials;

(B) is a tow truck company that performs nonconsent tows; or

(C) is domiciled in a foreign country.

(7) Insurance coverage. An applicant must indicate insurance coverage as required by §18.16 of this subchapter.

(8) Safety affidavit. Each motor carrier must complete, as part of the application, an affidavit stating that the motor carrier knows and will conduct operations in accordance with all federal and state safety regulations.

(9) Drug-testing certification. Each motor carrier must certify, as part of the application, that the motor carrier is in compliance with the drug-testing requirements of 49 C.F.R. Part 382.

(A) Drug-testing consortium participants. If the motor carrier belongs to a consortium, as defined by 49 C.F.R. Part 382, the applicant must provide the names of the persons operating the consortium.

(B) Report of positive result. A motor carrier required to register under this section shall report to the Department of Public Safety, in the manner required by the Department of Public Safety, a valid positive result on a controlled substances test performed as part of the carrier's drug testing program on an employee of the carrier who holds a commercial driver's license under Transportation Code, Chapter 522. The term "employee" as used in this subparagraph includes all employees as defined in Title 49, Code of Federal Regulations, Part 40.3.

(10) Duration of registration. An applicant must indicate the duration of the desired registration. Registration may be for seven calendar days or for 90 days, one year, or two years. The duration of registration chosen by the applicant will be applied to all vehicles. Household goods carriers may not obtain seven day or 90 day certificates of registration.

(11) Additional requirements. The following fees and information must be submitted with all applications.

(A) An application must be accompanied by an application fee of:

(i) $100 for annual and biennial registrations;

(ii) $25 for 90 day registrations; or

(iii) $5 for seven day registrations.

(B) An application must be accompanied by a vehicle registration fee of:

(i) $10 for each vehicle, other than a tow truck, requiring registration or $25 for each tow truck that the motor carrier proposes to operate under a seven day, 90 day, or annual registration; or

(ii) $20 for each vehicle, other than a tow truck, requiring registration or $50 for each tow truck that the motor carrier proposes to operate under a biennial registration.

(C) An application must be accompanied by proof of insurance or financial responsibility and insurance filing fee as required by §18.16 of this subchapter.

(D) An application must be accompanied by any other information required by law.

(12) Application of fees. Applicants who have paid vehicle fees under §18.17 of this subchapter may request that the department apply those fees to the carrier's motor carrier registration. The request must be accompanied by a copy of the Single State Registration receipt. On review of the Single State Registration receipt, the department will apply fees paid under the Single State Registration System as follows.

(A) The per vehicle fees paid by the applicant will be applied on a per vehicle basis toward the vehicle fees that the applicant owes for the vehicles registered under motor carrier registration.

(B) Vehicle fees will be applied only to the first year of registration if an applicant applies for a biennial motor carrier registration. The motor carrier must pay all vehicle fees for the second year.

(b) Incomplete applications. The director will return an application to the applicant if it is not accompanied by all fees and by proof of insurance or financial responsibility.

(c) Conditional acceptance of application. The director may conditionally accept an application if it is accompanied by all fees and by proof of insurance or financial responsibility, but is not accompanied by all required information. Conditional acceptance in no way constitutes approval of the application. The director will notify the applicant of any information necessary to complete the application. If the applicant does not supply all necessary information within 45 days from notification by the director, the application will be considered withdrawn and all fees will be retained.

(d) Disposition of application.

(1) Approval. An applicant meeting the requirements of this section and whose registration is approved will be issued the following documents.

(A) Certificate of registration. The department will issue a certificate of registration. The certificate of registration will contain the name and address of the motor carrier and a single registration number, regardless of the number of vehicles requiring registration that the carrier operates.

(B) Insurance cab card. The department will issue an original insurance cab card listing all vehicles to be operated under the carrier's certificate of registration. The insurance cab card shall be continuously maintained at the registrant's principal place of business. The insurance cab card will be valid for the same period as the motor carrier's certificate of registration and will contain information regarding each vehicle registered by the motor carrier. [ This subparagraph does not apply to Type B household goods carriers. ]

(i) A copy of the page of the insurance cab card on which the vehicle is shown shall be maintained in each vehicle listed. The appropriate information concerning that vehicle shall be highlighted. The insurance cab card will serve as proof of insurance as long as the motor carrier has continuous insurance or financial responsibility on file with the department.

(ii) On demand by a department-certified inspector or any other authorized government personnel, the driver shall present the highlighted page of the insurance cab card that is maintained in the vehicle.

(iii) The carrier shall notify the department in writing if it discontinues use of a registered commercial motor vehicle before the expiration of its insurance cab card.

(iv) Any erasure, alteration, or unauthorized use of an insurance cab card renders it void.

(v) If an original insurance cab card is lost, stolen, destroyed, or mutilated, if it becomes illegible, or if it otherwise requires replacement, a new insurance cab card will be issued by the department at the request of the motor carrier.

(vi) Registration listings previously issued by the department will remain valid until expiration or renewal or until revoked or suspended by the department.

(2) Denial. The department may deny a registration if the applicant had a registration revoked under §18.72 of this chapter.

(e) Additional and Replacement Vehicles. A motor carrier required to obtain a certificate of registration under this section shall not operate additional vehicles unless the carrier identifies the vehicles on a form prescribed by the director and pays applicable fees as described in this subsection.

(1) Additional vehicles. To add a vehicle, a motor carrier must pay a fee of $10 for each additional vehicle, other than a tow truck, or $25 for each tow truck that the motor carrier proposes to operate under a seven day, 90 day, or annual registration. To add a vehicle during the first year of a biennial registration, a motor carrier must pay a fee of $20 for each vehicle, other than a tow truck, or $50 for each tow truck. To add a vehicle during the second year of a biennial registration, a motor carrier must pay a fee of $10 for each vehicle, other than a tow truck, or $25 for each tow truck.

(2) Replacement vehicles. No fee is required for a vehicle that is replacing a vehicle for which the fee was previously paid. Before the replacement vehicle is put into operation, the motor carrier shall notify the department, identify the vehicle being taken out of service, and identify the replacement vehicle on a form prescribed by the department. A motor carrier registered under seven day registration may not replace vehicles.

(3) Fees paid under the Single State Registration System. Vehicle fees paid under §18.17 of this subchapter will be applied toward a motor carrier's vehicle fees under subsection (a)(12) of this section.

(f) Supplement to original application. A motor carrier required to register under this section shall submit a supplemental application under the following circumstances.

(1) Change of cargo. A registered motor carrier may not begin transporting household goods or hazardous materials, or performing nonconsent tows, unless the carrier submits a supplemental application to the department and shows the department evidence of insurance or financial responsibility in the amounts specified by §18.16 of this subchapter.

(2) Change of name. A motor carrier that changes its name shall file a supplemental application for registration no later than the effective date of the change. The motor carrier shall include evidence of insurance or financial responsibility in the new name and in the amounts specified by §18.16 of this subchapter. A motor carrier that is a corporation must have its name change approved by the Texas Secretary of State before filing a supplemental application. A motor carrier incorporated outside the state [ State ] of Texas must complete the name change under the law of its state of incorporation before filing a supplemental application.

(3) Change of address or legal agent for service of process. A motor carrier shall file a supplemental application for any change of address or any change of its legal agent for service of process no later than the effective date of the change. The address most recently filed will be presumed conclusively to be the current address.

(4) Change in principal officers and titles. A motor carrier that is a corporation shall file a supplemental application for any change in the principal officers and titles no later than the effective date of the change.

(5) Conversion of corporate structure. A motor carrier that has successfully completed a corporate conversion involving a change in the name of the corporation shall file a supplemental application for registration and evidence of insurance or financial responsibility reflecting the new company name. The conversion must be approved by the Texas Secretary of State before the supplemental application is filed.

(6) Change in drug-testing consortium status. A motor carrier that changes consortium status shall file a supplemental application that includes the names of the persons operating the consortium.

(7) Retaining a revoked or suspended certificate of registration number. A motor carrier may retain a prior certificate of registration number by:

(A) filing a supplemental application to re-register instead of filing an original application; and

(B) providing adequate evidence that the carrier has satisfactorily resolved the facts that gave rise to the suspension or revocation.

(g) Change of ownership. A motor carrier must file an original application for registration when there is a corporate merger or a change in the ownership of a sole proprietorship or of a partnership.

(h) Alternative vehicle registration for household goods agents. To avoid multiple registrations of a commercial motor vehicle, a household goods agent's vehicles may be registered under the motor carrier's certificate of registration under this subsection.

(1) The carrier must notify the department on a form approved by the director of its intent to register its agent's vehicles under this subsection.

(2) When a carrier registers vehicles under this subsection, the carrier's certificate will include all vehicles registered under its agent's certificates of registration. The carrier must register under its certificate of registration all vehicles operated on its behalf that do not appear on its agent's certificate of registration.

(3) The department may send the carrier a copy of any notification sent to the agent concerning circumstances that could lead to denial, suspension, or revocation of the agent's certificate.

[ (i) Type B household goods carriers. An application for motor carrier registration submitted by a Type B household goods carrier shall be in the form prescribed by the director. ]

[ (1) The carrier's application must contain all the information described in subsection (a) of this section, except for the information specified in subsection (a)(5) and (7) of this section. ]

[ (2) The carrier's application must be accompanied by a $100 application fee. ]

[ (3) The carrier's application must be accompanied by proof of financial responsibility for cargo loss or damage and by the filing fee specified in §18.16 of this subchapter. ]

[ (4) The carrier's application must include a statement certifying that the carrier: ]

[ (A) is in compliance with Transportation Code, Chapter 601; and ]

[ (B) if the carrier maintains an automobile liability insurance policy to comply with Transportation Code, Chapter 601, then the policy is an enforceable commercial or business automobile liability insurance policy. ]

[ (5) The department will issue an original certificate of registration, which must be continuously maintained at the registrant's principal place of business. ]

[ (6) A carrier shall carry a copy of its certificate of registration either in the cab of each vehicle or in each trailer used for the transportation of household goods. ]

[ (7) The carrier shall notify the department in writing when it discontinues operations as a transporter of household goods. ]

[ (8) On demand by a department-certified inspector or any other authorized government personnel, the driver shall present the certificate of registration maintained in the vehicle. ]

[ (9) The certificate of registration is continuously in effect until suspended or revoked by the department. A motor carrier may voluntarily cancel the certificate of registration by submitting a supplemental application or written request. ]

[ (10) Any erasure, alteration, or unauthorized use of a certificate of registration renders it void. ]

(i) [ (j) ] Substitute vehicles leased from leasing businesses. A registered motor carrier is not required to comply with the provisions of subsection (e) of this section for a substitute vehicle leased from a business registered under §18.19 of this subchapter. A motor carrier is not required to carry proof of registration as described in subsection (d) of this section if a copy of the lease agreement for the originally leased vehicle is carried in the cab of the temporary replacement vehicle.

§18.14.Expiration and Renewal of Commercial Motor Vehicle Registration.

(a) Expiration and renewal dates.

(1) A motor carrier with annual or biennial registration[ , other than a Type B household goods carrier, ] will be assigned a date for the expiration and renewal of its motor carrier registration according to the last digit of the carrier's certificate of registration number, as outlined in the following chart:

Figure: 43 TAC §18.14(a)(1) (No change.)

[ (2) Certificates of registration for Type B household goods carriers remain in effect until suspended or revoked. ]

(2) [ (3) ] 90 day certificates of registration are valid for 90 calendar days from the effective date.

(3) [ (4) ] Seven day certificates of registration are valid for seven calendar days from the effective date.

(b) Registration renewal.

(1) Approximately 60 days before the expiration of registration, the department will mail or send electronically a renewal notice to each registered motor carrier with annual or biennial registration[ , other than a Type B household goods carrier ]. The notice will be mailed to the carrier's last known address according to the division's records. Failure to receive the notice does not relieve the registrant of the responsibility to renew. A motor carrier must ensure that the department receives the renewal at least 15 days prior to the renewal date specified in subsection (a) of this section. A supplement to an application for motor carrier registration renewal must:

(A) supply any new information required under §18.13(f) of this subchapter if the information has not previously been supplied to the department;

(B) include a $10 fee for each vehicle, other than a tow truck, requiring registration or $25 for each tow truck that the carrier operates under an annual certificate of registration and a $20 fee for each vehicle, other than a tow truck, requiring registration or $50 for each tow truck that the carrier operates under a biennial certificate of registration; and

(C) include a copy of the Single State Registration receipt when requesting that vehicle fees paid under §18.17 of this subchapter be applied toward the fees specified by this subsection.

(2) Seven day and 90 day registrations may not be renewed.

(3) A motor carrier shall maintain continuous insurance or evidence of financial responsibility in an amount at least equal to the amount prescribed under §18.16 of this subchapter.

(4) The insurance cab card issued to a motor carrier is valid for the same period as the motor carrier's certificate of registration.

(5) To renew registration after it has expired, a motor carrier must identify its vehicles on a form prescribed by the director, pay all vehicle fees, and if current proof of insurance is not on file with the division, meet all insurance requirements.

§18.16.Insurance Requirements.

(a) Automobile liability insurance requirements.

[ (1) ] A motor carrier[ , other than a Type B household goods carrier, ] must file proof of commercial automobile liability insurance with the department on a form acceptable to the director for each vehicle required to be registered under this subchapter. The motor carrier must carry and maintain automobile liability insurance that is combined single limit liability for bodily injury to or death of an individual per occurrence, loss or damage to property (excluding cargo) per occurrence, or both. Extraneous information will not be considered acceptable, and the department may reject proof of commercial automobile liability insurance if it is provided in a format that includes information beyond what is required. Minimum insurance levels are indicated in the following table.

[ Figure: 43 TAC §18.16(a)(1) ]

Figure: 43 TAC §18.16(a)

[ (2) Type B household goods carriers shall comply with the applicable requirements of Transportation Code, Chapter 601. If a Type B household goods carrier maintains an automobile liability insurance policy to comply with Transportation Code, Chapter 601, the policy must be an enforceable commercial or business automobile liability insurance policy. ]

(b) Cargo insurance.

(1) Household goods carriers shall file and maintain with the department proof of financial responsibility.

(A) The minimum limits of financial responsibility for a household goods carrier for hire is $5,000 for loss or damage to a single shipper's cargo carried on any one motor vehicle.

(B) The minimum limits of financial responsibility for a household goods carrier for hire is $10,000 for aggregate loss or damage to multiple shipper cargo carried on any one motor vehicle. In cases in which multiple shippers sustain damage and the aggregate amount of cargo damage is greater than the cargo insurance in force, the insurance company shall prorate the benefits among the shippers in relationship to the damage incurred by each shipper.

(2) Tow truck company performing nonconsent tows. A tow truck company that performs nonconsent tows shall file and maintain with the department proof of financial responsibility for on-hook cargo. The minimum level of financial responsibility for each registered vehicle performing nonconsent tows will be in the amount of at least $50,000.

(c) Workers' compensation or accidental insurance coverage.

(1) A motor carrier that is required to register under this subchapter and whose primary business is transportation for compensation or hire between two or more incorporated cities, towns, or villages shall provide workers' compensation for all its employees or accidental insurance coverage in the amounts prescribed in paragraph (2) of this subsection.

(2) Accidental insurance coverage required by paragraph (1) of this subsection shall be at least in the following amounts:

(A) $300,000 for medical expenses and coverage for at least 104 weeks;

(B) $100,000 for accidental death and dismemberment, including 70% of employee's pre-injury income for not less than 104 weeks when compensating for loss of income; and

(C) $500 for the maximum weekly benefit.

(d) Qualification of motor carrier as self-insured.

(1) General qualifications. A motor carrier may meet the insurance requirements of subsections (a) and (b) of this section by filing an application, in a form prescribed by the department, to qualify as a self-insured. The application must include a true and accurate statement of the motor carrier's financial condition and other evidence that establishes its ability to satisfy obligations for bodily injury and property damage liability without affecting the stability or permanency of its business. The department may accept United States Department of Transportation evidence of the motor carrier's qualifications as a self-insured.

(2) Adopted final orders. The department adopts all final orders of the Railroad Commission of Texas to the extent that they concern self-insurance and were in effect on August 31, 1995. Those final orders are continued in effect until changed by order of the department.

(3) Applicant guidelines. In addition to filing an application as prescribed by the department, an applicant for self-insured status must submit materials that will allow the department to determine the following information.

(A) Applicant's net worth. An applicant's net worth must be adequate in relation to the size of its operations and the extent of its request for self-insurance authority. The applicant must demonstrate that it can and will maintain an adequate net worth.

(B) Self-insurance program. An applicant must demonstrate that it has established and will maintain a sound insurance program that will protect the public against all claims involving motor vehicles to the same extent as the minimum security limits applicable under this section. In determining whether an applicant is maintaining a sound insurance program, the department will consider:

(i) reserves;

(ii) sinking funds;

(iii) third-party financial guarantees;

(iv) parent company or affiliate sureties;

(v) excess insurance coverage; and

(vi) other appropriate aspects of the applicant's program.

(C) Safety program. An applicant must submit evidence of substantial compliance with the Federal Motor Carrier Safety Regulations as adopted by the Texas Department of Public Safety and with Transportation Code, Chapter 644.

(4) Other securities or agreements. The department may accept an application for approval of a security or agreement if satisfied that the security or agreement offered will adequately protect the public.

(5) Periodic reports. An applicant shall file annual statements, semi-annual and quarterly reports, and any other reports required by the department reflecting the applicant's financial condition and the status of its self-insurance program while the motor carrier is self-insured.

(6) Duration of self-insured status. The department may approve an applicant as a self-insured for any specific time or for an indefinite time.

(7) Revocation of self-insured status. On receiving evidence that a self-insured motor carrier's financial condition has changed, that its safety program or record is inadequate, or that it is otherwise not in compliance with this subchapter, the department may at any time require the self-insured to provide additional information. On 10 days notice from the department, the self-insured shall appear and demonstrate that it continues to have adequate financial resources to pay all claims involving motor vehicles for bodily injury and property damage liability. The self-insured shall also demonstrate that it remains in compliance with the requirements of this section and of any active self-insurance orders issued or adopted by the department. If an applicant fails to comply with this paragraph, its self-insured status may be revoked.

(8) Appeal. An applicant may appeal a denial or revocation of self-insurance status by filing a petition for an administrative hearing in accordance with §§1.21 et seq. of this title (relating to Procedures in Contested Cases).

(e) Filing proof of insurance with the department.

(1) Forms.

(A) A motor carrier[ , other than a Type B household goods carrier, ] shall file and maintain proof of automobile liability insurance for all vehicles required to be registered under this subchapter at all times. This proof shall be filed on a form acceptable to the director.

(B) A household goods carrier shall file and maintain proof of cargo insurance for its cargo at all times. This proof shall be on a form acceptable to the director.

(C) A tow truck company that performs nonconsent tows shall file and maintain with the department proof of on-hook cargo insurance for all nonconsent tows. This proof shall be on a form acceptable to the director.

(2) Filing proof of insurance and financial responsibility. A motor carrier's insurance or surety company, bank, or other financial institution shall file and maintain proof of insurance or financial responsibility on a form acceptable to the director:

(A) at the time of the original application for motor carrier certificate of registration;

(B) on or before the cancellation date of the insurance coverage as described in subsection (f) of this section;

(C) when the motor carrier changes insurers;

(D) when the motor carrier asks to retain the certificate number of a revoked certificate of registration;

(E) when the motor carrier changes its name under §18.13(f)(2) of this subchapter;

(F) when the motor carrier, under subsection (a) of this section, changes the classification of the cargo being transported; and

(G) when replacing another active insurance filing.

(3) Filing fee. Each certificate of insurance or proof of financial responsibility filed with the department for the coverage required under this section shall be accompanied by a nonrefundable filing fee of $100. This fee applies both when the carrier submits an original application and when the carrier submits a supplemental application when retaining a revoked certificate of registration number.

(4) Acceptable filings. The department will not accept an insurance policy or certificate of insurance unless it is issued by an insurance company licensed and authorized to do business in the state [ State ] of Texas. It must be in a form prescribed or approved by the DOI and signed or countersigned by an authorized agent of the insurance company. The department will accept a certificate of insurance issued by a surplus lines insurer that meets the requirements of Insurance Code, Article 1.14-2, and rules adopted by the DOI under that article.

(f) Cancellation of insurance coverage. Except when replaced by another acceptable form of insurance coverage or proof of financial responsibility approved by the department, no insurance coverage shall be canceled or withdrawn until 30 days after notice has been given to the department by the insurance company in a form approved by the department. Nonetheless, proof of insurance coverage for a seven day or 90 day certificate of registration may be canceled by the insurance company without 30 days notice if the certificate of registration is expired, suspended, or revoked, and the insurance company provides a cancellation date on the proof of insurance coverage. The department will revoke a certificate of registration under §18.72 of this chapter for failure to maintain proof of current insurance.

(g) Replacement insurance filing. The department will consider a new insurance filing as the current record of financial responsibility required by this section if:

(1) the new insurance filing is received by the department; and

(2) a cancellation notice has not been received for previous insurance filings.

(h) Insolvency of insurance carrier. If the insurer of a motor carrier becomes insolvent or becomes involved in a receivership or other insolvency proceeding, the motor carrier must file an affidavit with the department. The affidavit must be executed by an owner, partner, or officer of the motor carrier and show that:

(1) no accidents have occurred and no claims have arisen during the insolvency of the insurance carrier; or

(2) all claims have been satisfied.

(i) Notifications. The department shall notify the Texas Department of Public Safety and other law enforcement agencies of each motor carrier whose certificate of registration has been revoked for failing to maintain liability insurance coverage.

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 June 30, 2006.

TRD-200603536

Richard D. Monroe

General Counsel

Texas Department of Transportation

Earliest possible date of adoption: August 13, 2006

For further information, please call: (512) 463-8683

Subchapter C. RECORDS AND INSPECTIONS

43 TAC §18.32

STATUTORY AUTHORITY

The amendments are proposed under Transportation Code, §201.101, which provides the Texas Transportation Commission with the authority to establish rules for the conduct of the work of the department, and more specifically, Transportation Code, §643.003, which authorizes the department to adopt rules to administer Chapter 643 regarding motor carrier registration.

CROSS REFERENCE TO STATUTE

Transportation Code, Chapter 643.

§18.32.Motor Carrier Records.

(a) General records to be maintained. Every motor carrier shall prepare and maintain at its principal place of business in Texas:

(1) operational logs, insurance certificates, and documents to verify the carrier's operations;

(2) complete and accurate records of services performed;

(3) all certificate of title documents, weight tickets, permits for oversize or overweight vehicles and loads, dispatch records, tow tickets, or any other document that would verify the operations of the vehicle to determine the actual weight, insurance coverage, size, and/or capacity of the vehicle;

(4) documents supporting fee payments and the original registration receipts issued by the department for an interstate carrier registered under §18.17 of this chapter (relating to Single State Registration System), for a period of at least three years; and

(5) the original certificate of registration and registration listing, if applicable.

(b) Additional records for household goods carriers. In order to verify compliance with Subchapters B and E of this chapter, every household goods carrier shall retain complete and accurate records maintained in accordance with reasonable accounting procedures of all services performed in intrastate commerce. Household goods carriers shall retain all of the following information and documents:

(1) moving services contracts, such as, bills of lading or receipts;

(2) proposals for moving services;

(3) inventories, if applicable;

(4) freight bills;

(5) time cards, trip sheets, or driver's logs;

(6) claim records;

(7) ledgers and journals;

(8) canceled checks;

(9) bank statements and deposit slips;

(10) invoices, vouchers or statements supporting disbursements; and

(11) dispatch records.

(c) Proof of motor carrier registration.

(1) Except as provided in paragraph [ paragraphs (1) and ] (2) of this subsection, every motor carrier shall maintain a copy of its current registration listing in the cab of each registered vehicle at all times. A motor carrier shall make available to a certified inspector or any law enforcement officer a copy of the current registration listing upon request.

[ (1) A Type B household goods carrier shall maintain a copy of its certificate of registration in either the cab of each power unit or each trailer operated on its behalf at all times. A Type B household goods carrier shall make available and accessible to a certified inspector or any law enforcement officer a copy of the current certificate of registration. ]

(2) A registered motor carrier is not required to carry proof of registration in a vehicle leased from a leasing business that is registered under §18.19 of this chapter (relating to Short-term Lease and Substitute Vehicles), when leased as a temporary replacement due to maintenance, repair, or other unavailability of the originally leased vehicle. A copy of the lease agreement, or the lease for the originally leased vehicle, in the case of a substitute vehicle, must be carried in the cab of the vehicle.

(d) Location of files. Except as provided in paragraphs (1) and (2) of this subsection, every motor carrier shall maintain at a principal office in Texas all records and information required by the department.

(1) Texas firms. If a motor carrier wishes to maintain records at a location other than its principal office in Texas, the motor carrier shall make a written request to the manager. A motor carrier may not begin maintaining records at an alternate location until the request is approved by the manager.

(2) Out-of-state firms. A motor carrier whose principal business address is located outside the state of Texas shall maintain records required under this section at its principal office in Texas. Alternatively, a motor carrier may maintain such records at an out-of-state facility if the carrier reimburses the department for necessary travel expenses and per diem for any inspections or investigations conducted in accordance with §18.31 of this subchapter.

(3) A motor carrier that performs nonconsent tows shall maintain a current towing fee schedule, as prescribed in Subchapter H of this chapter (relating to Nonconsent Towing Fees Schedule), at all vehicle storage facilities where vehicles are delivered.

(e) Preservation and destruction of records. All books and records generated by a motor carrier, except driver's time cards and logs, must be maintained for not less than two years at the motor carrier's principal business address. A motor carrier must maintain driver's time cards and logs for not less than six months at the carrier's principal business 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 June 30, 2006.

TRD-200603537

Richard D. Monroe

General Counsel

Texas Department of Transportation

Earliest possible date of adoption: August 13, 2006

For further information, please call: (512) 463-8683