Proposed Sections Before an agency may permanently adopt a new or amended section, or repeal an existing section, a proposal detailing the action must be published in the Texas Register at least 30 days before any action may be taken. The 30-day time period gives interested persons an opportunity to review and make oral or written comments on the section. Also, in the case of substantive sections, a public hearing must be granted if requested by at least 25 persons, a governmental subdivision or agency, or an association having at least 25 members. Symbology in proposed amendments. New language added to an existing section is indicated by the use of bold text. [Brackets] indicate deletion of existing material within a section. TITLE 7. BANKING AND SECURITIES Part I. State Finance Commission Chapter 3. Banking Section Subchapter B. General 7 TAC sec.3.36 The State Finance Commission proposes new sec.3.36, concerning banks and trust companies conducting business under the same conditions as national banks. The new section is being proposed to give the state-chartered banks the same opportunity to conduct business on holidays and/or weekends as national banks currently have. Ann Graham, general counsel, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Ms. Graham, has determined that the proposed section will have no local employment impact. Ms. Graham also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be greater convenience for the banking public and more opportunities for state banks to locate in shopping centers, grocery stores, and other desirable locations. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Ann Graham, General Counsel, Texas Department of Banking, 2601 North Lamar Boulevard, Austin, Texas 78705-4294. The new section is proposed under the Texas Constitution, Article 16, sec.16(c) and Texas Civil Statutes, Article 342-113, which provides the State Finance Commission with the authority to promulgate rules to permit state banks to transact their affairs in any manner which they could do under existing law, rule, or regulation were they organized and operating as a national bank under the laws of the United States. sec.3.36. Operation of Banks or Trust Companies Under the Same Conditions as National Banks. (a) The Texas Constitution provides that state banks have the same rights and privileges that are or may be granted to national banks. National banks are now permitted under applicable law to close or remain open on any state designated holiday unless the comptroller of the currency directs otherwise by written order. In recognition of this fact, allowing state banks and trust companies to operate and conduct business under the same conditions as national banks, adheres to the principle of competitive equality. (b) Any bank or trust company doing business in this state may, at its option, elect to open and conduct business under the same conditions and to the same extent as a national bank. Notwithstanding the preceding, however, a bank or trust company making an election to do business under the same conditions as a national bank, must comply with all laws and regulations which govern the time period drafts and other items must be processed. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 16, 1991. TRD-9116379 Ann Graham General Counsel Texas Department of Banking Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 475-1300 Chapter 4. Currency Exchange General 7 TAC sec.4.01 (Editor's Note: The State Finance Commission proposes for permanent adoption the new section it adopts on an emergency basis in this issue. The text of the new section is in the Emergency Rules section of this issue.) The State Finance Commission proposes new sec.4.01, concerning the granting of provisional licenses under the Currency Exchange Act. The Currency Exchange Act empowers the State Finance Commission to promulgate general rules necessary to implement the provisions of that Act. This new section allows for the issuance of a temporary license which would be effective during the period of time an application is being processed by the Department of Banking. Brian R. Herrick, assistant counsel, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Ann Graham, general counsel, has determined that the proposed rule will have no local employment impact. Mr. Herrick also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be to provide for the orderly administration of the Currency Exchange Act and ensure that the purposes of the Act are substantially fulfilled. The rule will also allow applicants currently in business to continue operations, uninterrupted, during the application process. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Brian R. Herrick, Assistant General Counsel, Texas Department of Banking, 2601 North Lamar Boulevard, Austin, Texas 78705-4294. The new section is proposed under Texas Civil Statutes, Article 350, sec.7, which directs the State Finance Commission to adopt rules necessary to implement the Act, including, but not limited to, rules with respect to issuance of licenses. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 16, 1991. TRD-9116384 Ann Graham General Counsel Texas Department of Banking Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 475-1300 7 TAC sec.4.02 The State Finance Commission proposes new sec.4.02, concerning the addition of a new principal (as defined in the Currency Exchange Act, sec.1) employed by a currency exchange or transmission business licensed under the Currency Exchange Act. The Currency Exchange Act empowers the State Finance Commission to promulgate general rules necessary to implement the provisions of that Act. This new section requires that licensees notify the commissioner of the addition of a new principal and submit the necessary application information relating to that principal. Brian R. Herrick, assistant general counsel, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Ann Graham, general counsel, has determined that the proposed rule will have no local employment impact. Mr. Herrick also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be to provide for the orderly administration of the Currency Exchange Act and ensure that the purposes of the Act are substantially fulfilled. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Brian R. Herrick, Assistant General Counsel, Texas Department of Banking, 2601 North Lamar Boulevard, Austin, Texas 78705-4294. The new section is proposed under Texas Civil Statutes, Article 350, sec.7, which direct the State Finance Commission to adopt rules necessary to implement the Act, including, but not limited to, rules with respect to issuance of licenses. sec.4.02. Change of Principal. (a) Licensees shall notify the banking commissioner, in writing, of the employment of any additional principal (as defined in the Currency Exchange Act (the Act), sec.1) not disclosed in their license application or any renewal application, within 10 days of the effective date of employment. This notification requirement shall include the promotion of any existing employee, not previously considered a principal, to a position which would qualify that person as a principal under the Act. New principals must meet all of the qualifications and are subject to all other requirements set forth in the Act, sec.sec.6, 8, and 9, as if a new application has been filed. Should the new principal fail to qualify, then the license of the employer licensee will be subject to suspension or revocation. (b) The Act, sec.4(g) prohibits the transfer or assignment of a license issued under the Act. Therefore, the addition or loss of a partner who owns or control 10% or more of the partnership, directly or indirectly, in the case of a licensed partnership, will be considered a dissolution of the licensee and, as such, necessitates that the surviving entity apply for a new license. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 16, 1991. TRD-9116382 Ann Graham General Counsel Texas Department of Banking Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 475-1300 7 TAC sec.4.03 The Finance Commission proposes new sec.4.03, concerning recordkeeping and reporting requirements under the Currency Exchange Act. The Currency Exchange Act empowers the Finance Commission of Texas to promulgate general rules necessary to implement the provisions of that Act. The new section requires that licensees maintain records required under federal law and file quarterly reports with the Department of Banking on forms to be prescribed by the commissioner. Brian R. Herrick, assistant general counsel, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Herrick has determined that the proposed rule will have no local employment impact. Mr. Herrick also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be to provide for the orderly administration of the Currency Exchange Act and ensure that the purposes of the Act are substantially fulfilled. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Brian R. Herrick, Assistant General Counsel, Texas Department of Banking, 2601 North Lamar Boulevard, Austin, Texas 78705-4294. The new rule is proposed under Texas Civil Statutes, Article 350, sec.7. sec.4.03. Reporting and Recordkeeping. (a) Licensees shall maintain separate accounting books and records relating to their operations in Texas. All books and records maintained by licensee's in accordance with this section shall be located where they are readily accessible to the Department of Banking. (b) Licensees shall maintain records of any filings made pursuant to or documentation required under any applicable federal law or regulation, including, but not limited to, the requirements set forth in Title 31 United States Code, sec.5313, and Title 31 Code of Federal Regulation, Part 103. (c) Each Licensee shall, in a form prescribed by the Banking Commissioner, file quarterly written reports to the Department of Banking. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 16, 1991. TRD-9116385 Ann Graham General Counsel Texas Department of Banking Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 475-1300 7 TAC sec.4.04 The State Finance Commission proposes new sec.4.04 concerning the change of location of a currency exchange or transmission business licensed under the Currency Exchange Act. The Currency Exchange Act empowers the Finance Commission of Texas to promulgate general rules necessary to implement the provisions of that Act. The new section requires that licensees notify the Commissioner thirty days prior to such a change. Brian R. Herrick, assistant general counsel, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Herrick has determined that the proposed rules will have no local employment impact. Mr. Herrick also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section to provide for the orderly administration of the Currency Exchange Act and ensure that the purposes of the Act are substantially fulfilled. There will be no effect small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Brian R. Herrick, Assistant General Counsel, Texas Department of Banking, 2601 North Lamar Boulevard, Austin, Texas 78705-4294. The new section is proposed under Texas Civil Statutes, Article 350, sec.7. sec.4.04. Change of Location. Each Licensee shall give the banking commissioner 30 days' prior, written notification of any change in any location from which they conduct any of their currency exchange or transmission activities, including the identify of the new location, the name of the lessor or owner of the new location, and the estimated date of the change. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 16, 1991. TRD-9116386 Ann Graham General Counsel Texas Department of Banking Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 475-1300 7 TAC sec.4.05 The State Finance Commission proposes new sec.4.05, concerning the acquisition of control of a corporation licensed under the Currency Exchange Act. The Currency Exchange Act empowers the Finance Commission of Texas to promulgate general rules necessary to implement the provisions of that Act. The new section requires that an applicant for acquisition of control of a corporate licensee be filed, in advance, with the commissioner. The new section would also provide the processing time for the application and allow for a hearing in the event the application is denied. Brian R. Herrick, assistant general counsel, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Herrick, has determined that the proposed rule will have no local employment impact. Mr. Herrick also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be to provide for the orderly administration of the Currency Exchange Act and ensure that the purposes of the Act are substantially fulfilled. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Brian R. Herrick, Assistant General Counsel, Texas Department of Banking, 2601 North Lamar Boulevard, Austin, Texas 78705-4294. The new section is proposed under Texas Civil Statutes, Article 350, sec.7. sec.4.05. Acquisition of Control of Corporate Licensee. (a) No person may acquire control of a corporate licensee if, after acquisition, the person would own or possess the power to vote 10% or more of the voting securities of the licensee, directly or indirectly, unless an application is filed with the banking commissioner for his review of the proposed transaction and for his action, if any, as provided in this section. (b) The application shall be on a form prescribed by the Banking Commissioner and shall be made under oath. The application shall, except to the extent expressly waived by the banking commissioner, contain the following information: (1) the identity, personal history, business background and experience relating to the currency exchange or transmission business, and a description of any material, pending legal or administrative proceedings to which the applicant is a party; (2) any plans or proposal which any acquiring party making the acquisition may have to make major changes in its business or corporate structure or management; and (3) such other information that the commissioner orders to be included in the particular application being filed. (c) The applicant shall pay the appropriate filing fee when he files the application. A person proposing to acquire voting securities subject to the provisions of this section includes an individual, two or more individuals acting in concert, any type of partnership, corporation, syndicate, trust, or any other organization, or any combination of the foregoing, and the information required by the banking commissioner may be required of each member of the group, as directed by the banking commissioner. (d) The banking commissioner shall issue an order denying an application if he finds that the application does not meet the statutory requirements of the Currency Exchange Act. (e) If an application filed under this section is not denied by the banking commissioner within 30 days after it is filed, the transaction may be consummated. The banking commissioner, before the expiration of the 30 day period, may give the applicant written notice that the application will not be denied, in which case the transaction may be consummated. Any agreement entered into by the applicants and the banking commissioner as a condition that the application will be denied is enforceable against the licensee and will be considered an agreement under the provisions of the Currency Exchange Act for all purposes. (f) If the banking commissioner issues an order denying an application, the applicant is entitled to a hearing if he so requests, in writing, no later than 30 days after the application is filed or the 20th day after the day the application is denied. Any such hearing shall be conducted in accordance with the Currency Exchange Act, sec.21. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 16, 1991. TRD-9116387 Ann Graham General Counsel Texas Department of Banking Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 475-1300 Chapter 11. Miscellaneous 7 TAC sec.11.34 The State Finance Commission proposes new sec.11.34, concerning notices to applicants and application processing times for applications to operate a branch bank facility and other forms of required authorization from the Banking Department or the commissioner. The new section provides a period of time within which the department must issue a written notice informing the applicant that the application is complete and accepted for filing, or that the application is deficient, setting out specific additional information that is required. Brian R. Herrick, assistant general counsel, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Herrick has determined that the proposed rule will have no local employment impact. Mr. Herrick also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be notice to the public of the periods within which applications will be processed by the commissioner and the department and of the existence of a remedy for any failure of the Department or the commissioner to comply with those time periods. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Brian R. Herrick, Assistant General Counsel, Texas Department of Banking, 2601 North Lamar Boulevard, Austin, Texas 78705-4294. The new section is proposed under Article 6252-13b.1, sec. s1-7, which provides the State Finance Commission with the authority to promulgate rules setting out procedures for processing applications and setting out time periods to be followed. sec.11.34. Branch Bank Application Processing Times; Processing Times For Other Applications Not Otherwise Specifically Provided For. (a) An application to establish a branch office facility of a bank or other form of authorization granted by the department or the commissioner not otherwise specifically provided for by statute or rule must be filed on a form provided by the commissioner. The commissioner shall issue written notice informing the applicant either that the application is complete and accepted for filing or that the application is deficient and what specific information is required. The commissioner shall issue such notice to the applicant within 10 days of the date the application is actually received. (b) The commissioner or department shall determine whether to grant or deny a completed application to establish a branch facility or other form of authorization granted by the department or commissioner not otherwise specifically provided for by statute or rule within 60 days after the completed application has been accepted for filing. If, however, the commissioner extends the time period for receiving public comments regarding a branch bank application, as provided in 7 TAC sec.3.91, the time periods within which the application must be granted or denied, likewise, will be extended for an equal length of time. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 16, 1991. TRD-9116381 Ann Graham General Counsel Texas Department of Banking Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 475-1300 Chapter 27. Applications Subchapter B. Regulation of Licenses 7 TAC sec.27.1 The State Finance Commission proposes an amendment to sec.27.1, concerning notices to applicants and application processing time periods for applications under the currency exchange act. The rule provides a period of time within which the department must issue a written notice informing the applicant that the application is deficient, setting out specific additional information that is required. The rule also provides a period of time, beginning on the date a complete application has been accepted for filing, within which the commissioner must reach a decision to either deny or approve the application. Brian R. Herrick, assistant general counsel, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Herrick, has determined that the proposed amendment will have no local employment impact. Mr. Herrick also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be notice to the public of the period within which applications will be processed by the commissioner and the department and of the existence of a remedy for any failure of the department or the commissioner to comply with those time periods. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Brian R. Herrick, Assistant General Counsel, Texas Department of Banking, 2601 North Lamar Boulevard, Austin, Texas 78705-4294. The amendment is proposed under Texas Civil Statutes, Article 6252-13b.1, sec.sec.1-7, which provides the State Finance Commission with the authority to promulgate rules setting out procedures for processing applications and setting out time periods to be followed. sec.27.1. Notices to Applicants; Application Processing Times; Appeals. (a) An application for prepaid funeral sellers permit, perpetual care cemetery certificate of authority, or sale of checks license granted by the commissioner must be filed on a form or in a manner approved by the banking commissioner. The department shall issue a written notice informing each applicant either that the application is complete and accepted for filing, or that the application is deficient and that specific additional information is required. The department shall issue the notice to the applicant within the period indicated for the following: (1) prepaid funeral sellers permits: 10 days; (2) perpetual care cemetery certificates of authority: 10 days; [and] (3) sale of checks licenses: 10 days[.] ; and (4) currency exchange act licenses; 10 days. (b) The commissioner shall determine whether to deny or approve an application within the following periods an in the following manner after a complete application has been accepted for filing: (1) prepaid funeral seller's permits: 45 days; (2) perpetual care cemetery certificates of authority: 45 days; [and] (3) sale of checks licenses: 45 days[.] ; and (4) currency exchange act licenses: 45 days. (c)-(d) (No change.) This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 16, 1991. TRD-9116380 Ann Graham General Counsel Texas Department of Banking Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 475-1300 TITLE 25. HEALTH SERVICES Part I. Texas Department of Health Chapter 133. Hospital Licensing Standards 25 TAC sec.133.21 The Texas Department of Health (department) proposes an amendment to sec.133. 21, concerning hospital licensing standards (standards) which the section adopts by reference. The amendment to the text of sec.133.21 reflects the effective date of the amendment to the standards. The amendment to the standards themselves adds a new Chapter 12 to the standards concerning special licensing standards governing and recommendations addressing the provision of mental health services in general hospitals. Chapter 12 is added to address patient care and patient rights in the delivery of mental health services in response to a direction directed by the Senate Interim Study Committee on Health and Human Services and the office of the lieutenant governor that resulted from the committee's study of abuses surrounding the operation of private psychiatric hospitals. The chapter is intended to coordinate with the rules recently adopted by the Texas Board of Mental Health and Mental Retardation (TXMHMR) and to provide standards and recommendations to prevent the occurrence in general hospitals of the recently identified abuses in the delivery of mental health services in private psychiatric hospitals. Because of the narrow scope of rulemaking authority granted in the Texas Hospital Licensing Law (Health and Safety Code, Chapter 241) to the Texas Board of Health, however, much of the chapter's content is, of necessity, couched in terms of recommendations. The new chapter adopts by reference the following requirements: the "Medicare Conditions of Participation for Hospitals," as described in Title 42, Code of Federal Regulations, Chapter IV, Part 482, Subpart A, sec.482.2-sec.482.57. The chapter also recommends that general hospitals comply with Title 42, Code of Federal Regulations, Chapter IV, Part 482, Subpart E, sec.482.61 and sec.482.62; the standards set out by the Joint Commission on Healthcare Organizations in the most recent edition of the "Consolidated Standards Manual" for special treatment procedures and patient rights; and 25 Texas Administrative Code, sec.404.81, the TXMHMR rules relating to patient abuse and neglect in private psychiatric hospitals. The new chapter covers: purpose; scope; definitions; application for license or renewal license; special treatment procedures; administration of medications; patient rights; patient complaints; compliance with reporting requirements of other state laws; protection against certain crimes and consumer abuses; compliance with applicable provisions of the Texas Mental Health Code, Title 7, Subtitle C; special standards covering investigations, notice, opportunity for correction, and enforcement actions. Stephen Seale, Chief Accountant III, Budget Office, has determined that for the first five-year period the proposed amendment is in effect there will be fiscal implications for state government as the result of enforcing or administering the amendment. Additional costs to the state will arise from the statutory duty for the department to enforce the amendment and from the added administrative, investigation, and enforcement responsibilities. For each year of the first five years the amendment is in effect the increased program costs will range from $205,000 to $307,000. In addition, the present cost of each administrative hearing conducted by the department is approximately $1,574 (the number of hearings cannot be projected). There will be additional costs to local governments and hospital districts that operate a general acute care hospital which provides mental health services. The costs will arise primarily from the hospital's participation in administrative hearings regarding actions against the hospital's license for violation of the new standards. These costs could range from a minimum cost of $150 to send one representative to the administrative hearing to a maximum cost of $10,000 that includes the fees of one or more attorneys, expert witnesses, and the presence of multiple hospital personnel. Mr. Seale also has determined that for each year of the first five years this amendment is in effect the public benefit anticipated as a result of enforcing this amendment will be the correction of the actual personal and monetary abuses identified in the delivery of mental health services and the recognition of patient rights. The cost to small or large businesses that operate a general acute care hospital that provides mental health services will be the same as previously mentioned for local governments and hospital districts. There is no anticipated economic cost to persons and there will be no impact on local employment. Comments on the proposal may be submitted to Maurice B. Shaw, Chief, Bureau of Licensing and Certification Division, 1100 West 49th Street, Austin, Texas 78756, (512) 458-7538. Comments will be accepted for 30 days after publication of the proposed amendment in the Texas Register. Copies of the proposed amendments may be obtained at the Health Facility Licensure and Certification Division, Texas Department of Health. The amendment is proposed under the Health and Safety Code, sec.241.027, which provides the Texas Board of Health (board) with authority to adopt rules to establish and enforce minimum standards for the licensing of hospitals; and sec.12.001, which provides the board with authority to adopt rules for the performance of every duty imposed by law upon the board, the department, and the commissioner of health. sec.133.21. Adoption by Reference. (a) The Texas Department of Health adopts by reference the rules contained in the department publication effective September 1, l985, entitled "Hospital Licensing Standards," as amended through February, 1992
    [August, 1991]. (b) (No change.) This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 30, 1991. TRD-9116412 Robert A. MacLean, M.D. Deputy Commissioner Texas Department of Health Proposed date of adoption: February 22, 1992 For further information, please call: (512) 458-7538 TITLE 28. INSURANCE Part I. Texas Department of Insurance Chapter 1. General Administration Subchapter J. Custody and Use of Criminal History Record Information 28 TAC sec.sec.1.1201-1.1205 The Texas Department of Insurance proposes new sec.sec.1.1201-1.1205, concerning custody and use of criminal history information for applicants for licenses issued by the Texas Department of Insurance and corporate officers of insurance companies. The new sections are necessary to comply with the provisions of the Texas Insurance Code, Article 1.10C(c), which requires the adoption of rules governing the custody and use of information obtained under the Texas Insurance Code, Article 1.10C. New sec.1.1201 sets forth general provisions concerning these new sections, sec.1.1202 defines the terms used in these new sections, and sec.1.1203 sets out the manner in which the Texas Department of Insurance will maintain custody of and use criminal history information described in Texas Insurance Code, Article 1.10C. New sec.1.1204 describes the way in which applicants and licensees shall furnish fingerprints to the Texas Department of Insurance, and sec.1.1205 describes the potential consequences of failure to comply with a request for fingerprints. Scott Kyle, acting director of investigation, has determined that for the first five-year period the proposed sections will be in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the sections, and there will be no effect on local employment or local economy. Mr. Kyle, also has determined that for each year of the first five years the sections are in effect the public benefit anticipated as a result of enforcing the sections will be more effective licensing of regulated entities. There will be no effect on small businesses. There will be no cost for obtaining fingerprints if the prints are obtained from the offices listed in these sections. Comments on the proposal may be submitted to Scott Kyle, Acting Director of Investigations, Mail Code 109-3A, Texas Department of Insurance, 333 Guadalupe, P.O. Box 149104, Austin, Texas 78701-1904. The new sections are proposed under the Texas Insurance Code, Article 1.04(c) and Article 1.10C, and Texas Civil Statutes, Article 6252-13a, sec.4 and sec.5. The Texas Insurance Code, Article 1.04(c) provides general rule-making authority for the State Board of Insurance. The Texas Insurance Code, Article 1.10C, mandates the adoption of rules by the State Board of Insurance governing the custody and use of the information described in that article; and Texas Civil Statutes, Article 6252-13a, s4 and sec.5 require and authorize each state administrative agency to adopt rules of practice setting forth the nature and requirements of available procedures, and prescribe the procedure for adoption of rules by state administrative agencies. sec.1.1201. General Provisions. (a) Statutory basis and purpose. This subchapter describes the manner in which the Texas Department of Insurance will maintain and make use of information described in the Texas Insurance Code, Article 1.10C, which was enacted as a part of Chapter 242, at page 944 of the Acts of the 72nd Legislature and becomes effective on and after the date the board adopts rules and a uniform method of obtaining criminal history information as described in the Texas Insurance Code, Article 1.10C, subsection (c). (b) Severability. If any terms or sections of this subchapter are determined by a court of competent jurisdiction to be inconsistent with the provisions of the Texas Insurance Code, Article 1.10C, or to be null and void for any reason, the remaining terms and provisions of this subchapter shall continue in effect. (c) Effect of rules. The sections set out in this subchapter are prescribed to govern the maintenance and use of the criminal history information described in the Texas Insurance Code, Article 1.10C and are not to be construed as limitations upon the exercise of statutory authority by the State Board of Insurance or the commissioner of insurance. (d) Effective date. This subchapter becomes effective January 1, 1992. sec.1.1202. Definitions.
      The following words and terms, when used in this subchapter, shall have the following meanings, unless the context clearly indicates otherwise. Board-The State Board of Insurance. Commissioner-The Commissioner of Insurance. Criminal history information-Information detailing criminal history records maintained by the Department of Public Safety, the Federal Bureau of Investigation identification division, or another law enforcement agency. Department-The Texas Department of Insurance. Insurance company -Any insurance company, corporation, inter-insurance exchange, mutual, reciprocal, association, county mutual insurance company, Lloyds or other insurance carrier licensed to transact business in the State of Texas, or applying for a license to transact business in the State of Texas. Investigated person -An applicant for any license, permit, certificate of authority, certificate of registration, or other authorization issued by the board to engage in an activity regulated under the Texas Insurance Code; or a corporate officer of an insurance company regulated by the department. sec.1.1203. Custody and Use of Criminal History Information. (a) Custody. (1) The department shall keep criminal history record information, as defined in this subchapter, privileged and confidential, and available for the exclusive use of the department, in the files of the license and investigations division. (2) After the department has made a determination as to the issuance or denial of the license or certificate of authority, the criminal history record information shall be sealed and the department shall keep the sealed information separate from other records, and in the custody of the commissioner or his designee. (3) Criminal history record information will only be released by the department with the written consent of the person being investigated or on court order. (b) Use. (1) The department may use criminal history information as defined in this subchapter only to ascertain the eligibility of an investigated person to engage in the business of insurance in this state. (2) The department may use criminal history information to confirm the existence of convictions when the department has received information from other sources indicating that an applicant or licensee has a criminal history. (3) The department may use criminal history information to lead to the discovery of other information bearing upon the applicant's or licensee's fitness to hold a license. sec.1.1204. Procedure for Submission of Fingerprints. (a) Upon request by the department, an investigated person shall submit a complete set of fingerprints within 20 days to the department. (b) An investigated person shall obtain such fingerprint records, at his or her own expense, from: (1) an office of the Texas Department of Public Safety; or (2) the sheriff of the county in which the investigated person resides or works; or (3) the police department in the area in which the person resides or works. sec.1.1205. Consequences of Failure to Submit Fingerprints Upon Request. (a) The failure of an applicant to provide a complete set of fingerprints on request as described in 11.1203 of this title (relating to Custody and Use of Criminal History Information) may result in the denial of a license to an applicant for any license, permit, certificate of authority, certificate or registration, or other authorization issued by the Texas Department of Insurance. (b) The department may deny a certificate of authority to any insurance company whose corporate officer fails to provide a complete set of fingerprints on request as described in s11.1203. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 30, 1991. TRD-9116436 Linda K. von Quintus-Dorn Chief Clerk Texas Department of Insurance Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 463-6327 Chapter 5. Property and Casualty Insurance Subchapter A. Automobile Insurance 28 TAC sec.5.401 The State Board of Insurance of the Texas Department of Insurance proposes new sec.5.401 to provide four specific protections to applicants for private passenger automobile liability insurance in response to complaints it received which are discussed below. The first measure (subsection (a) of the new section) provides a 120-day period during which all insurers' underwriting criteria shall be discontinued that make an applicant's lack of prior insurance the basis for declining coverage or charging higher rates to such applicant. This provision will allow all applicants to be underwritten on the same basis, that is, on their driving records and other criteria of the insurance companies writing such policies and to receive such liability coverage at the companies' or groups' lowest applicable rates. The second provision (subsection (b)) will permit those individuals who were insured under the discontinued "no prior insurance" underwriting criteria prior to the effective date of the new section to derive the benefit of subsection (a). This is accomplished by permitting those individuals, at renewal of their current automobile insurance policies, to be re-underwritten without regard to the discontinued "no prior insurance" criteria and to receive the lowest applicable rates of the companies or groups to which they apply. Subsection (b), which has a 180-day duration, is intended to cover the typical policy period of six months in order to provide protection to a substantial majority of those recently insured and rated by a company using the discontinued "no prior insurance" criteria. The third provision (subsection (c)) protects all applicants from the arbitrary practice of some insurance companies which charge higher rates to applicants because they were previously insured through a county mutual insurance company, the Texas Automobile Insurance Plan (also known as the "Assigned Risk Plan") or other carrier usually associated with higher risk business. This provision requires that applicants for liability insurance be underwritten without regard to their prior insurance carrier. Subpart (c) is proposed as a permanent rule. The fourth provision (subpart (d)) provides for the disclosure of comparative rating information to certain applicants who might benefit from auto liability coverage through the Assigned Risk Plan. Subsection (d) requires all insurers and agents to disclose the cost of auto liability coverage available in the Assigned Risk Plan to all applicants lacking prior insurance who have no more than one accident and one violation in the three years preceding their application where such cost is equal to or less than the cost of coverage in the voluntary market being quoted to such applicants. This provision is also proposed as a permanent rule. The fifth provision (subsection (e)) declares that the provisions of the new section are severable from each other and provides that if any provision of the new section is held to be invalid then such invalidity shall not affect the other provisions. This provision is intended to maintain the separate enforcability of each provision of the new section in the event any one provision is held to be invalid. The Board is proposing the new section to solve problems recently brought to its attention by complaints from individuals attempting to comply with the Texas Motor Vehicle Safety-Responsibility Act, Texas Civil Statutes, Article 6701h). Many uninsured motorists seeking liability insurance complained to the Board that they were being denied coverage or charged high rates for liability insurance because they lacked such insurance at the time of application. Some of the complainants had not needed or been legally required to have liability insurance, because, for example, they had been overseas either in the armed services or for other employment, had driven company cars or had not used a motor vehicle for transportation for some period prior to their applications. Others lacked prior insurance because they could not afford it, having been out of work or otherwise impoverished. The Board also heard complaints that "no prior" applicants who had purchased liability insurance from county mutual or other higher rated insurance companies or the Assigned Risk Plan were being treated subsequently as higher risks because of their insurance carriers causing them to continue to have to pay higher rates for longer periods. The Board also heard complaints from motorists and agents that "no prior" applicants were not being told about less expensive liability coverage in the Assigned Risk Plan when they were quoted coverage by private insurers, and as a consequence were paying rates above those available through the Assigned Risk Plan for liability insurance. The proposed section is intended to respond to these problems. A. W. Pogue, associate commissioner for regulated lines of the Texas Department of Insurance, has determined that for each year of the first five years the new section will be in effect, there will be no fiscal implications to state or local governments a result of enforcing or administering the section. During the six-month period that subsection (b) will be in effect, small businesses may face some increased cost, which Mr. Pogue cannot quantify, to comply with that subpart in order to identify current insureds who were underwritten previously for liability insurance using discontinued "no-prior insurance" criteria. The cost of compliance with this subpart for small businesses should be no different than the cost of compliance for big businesses on a cost per hour basis. Otherwise there should be no fiscal implications to small business as a result of enforcing or administering the section. A. W. Pogue also has determined that for each year of the first five years the new section is in effect, the public benefit anticipated as a result of enforcing the section will include the following. There will be greater fairness in the private passenger automobile liability insurance marketplace. The new section will result in more affordable rates to many individuals. A larger proportion of the driving public will be covered by automobile liability insurance and, as a consequence, a larger proportion of damages from automobile accidents should be covered by liability insurance. This serves the public policies expressed by the Texas Legislature in the Texas Motor Vehicle Safety- Responsibility Act which mandates that all Texas drivers carry a minimum level of automobile liability insurance. In addition, consumers will be better- informed on the cost of automobile liability insurance prior to purchasing coverage. Mr. Pogue has determined that for each of the first five years the new section is in effect, the anticipated economic cost to persons who are required to comply with the proposed new section includes the following: During the first year, which is the only year subsections (a) and (b) will be in effect, one anticipated cost is the difference, if any, in the amount of premiums which insurers would have charged using the "no prior insurance" underwriting criteria compared to the premiums which they charge without using this criteria calculated for the period of duration of subsections (a) and (b). Similarly, the agents' portion of this difference in premium amount would constitute an economic cost to them during the same period. However, it has been estimated that some three million Texas drivers are not currently covered by automobile liability insurance. Recent statutory changes in the enforcement of the Texas Motor Vehicle Safety-Responsibility Act, which now requires all drivers to present proof of minimum liability insurance to receive a driver's license, imspection stickers, and license tags for thier cars should cause many of that large pool of uninsured motorists to buy liability insurance. The additional premium volume generated by these new applicants may offset to some degree some of the above costs. During each of the first five years the new section is in effect, another anticipated cost is the difference, if any, in the amount of premiums which insurers would have charged using criteria relating to applicants' prior insurance carrier compared to the premiums which they charge without using such criteria under subsection (c). Similarly, the agents' portion of this difference in premium amount should constitute an economic cost to them. In addition, some insurers and agents may lose business to the Assigned Risk Plan due to the disclosure of more favorable rates available to consumers through the Plan as required under subsection (d). Comments to be considered by the State Board of Insurance must be submitted in writing within 30 days after publication of the proposed section in the Texas Register to A. W. Pogue, associate commissioner for regulated lines, Mail Code 107-2A, Texas Department of Insurance, P.O. Box 149093, Austin, Texas 78714- 9093. The new section is proposed under the Insurance Code, Article 5.10, which authorizes the State Board of Insurance to make and enforce rules and regulations not inconsistent with the provisions of Subchapter A (Motor Vehicle or Automobile Insurance) of Chapter 5 of the Insurance Code; the Insurance Code, Article 5.01, which gives the board sole and exclusive authority to determine and prescribe just, reasonable, and adequate rates and rating plans and classification of risks for motor vehicle insurers; the Insurance Code, Article 5.09, which prohibits discrimination or distinctions in favor of an insured having a like hazard, in the charge of premiums for insurance; the Insurance Code, Article 1.04, which provides the board with the authority to determine policy and rules in accordance with the laws of this State; the Insurance Code, Article 21.49-2B, sec.12, which authorizes the board to adopt rules relating to the cancellation and nonrenewal of personal automobile insurance policies; and the Insurance Code, Article 21.49-2, which authorizes the board to prescribe, adopt, promulgate, and enforce reasonable rules and regulations as to the cancellation, nonrenewal, and in certain cases, declination, of certain policies of insurance,including those issued through the Texas Automobile Insurance Plan (the "Assigned Risk Plan"). Subsection (d) of the new section is additionally proposed under the Insurance Code, Article 21.07, sec.13, which provides the board with the authority to establish reasonable rules and regulations for the licensing of agents; the Insurance Code, Article 21.07-3, sec.21, which provides the board with the authority to establish reasonable rules and regulations for the licensing of managing general agents; and the Insurance Code, Article 21.14 which provides the Board with the authority to license local recording agents and solicitors. The new section affects Subchapter A of Chapter 5 of the Insurance Code, including Articles 5.10, 5.01 and 5.09, Chapter 1 of the Insurance Code, including Article 1.04, Subchapter E of Chapter 21 of the Insurance Code, including Articles 21.49-2B sec.12 and 21.49-2, and affects Subchapter A of Chapter 21 of the Insurance Code, including Article 21.07, sec.13, Article 21.07-3, sec.21, and Article 21.14, all as heretofore specified and discussed. The new section, if adopted, shall amend Title 28 of the Texas Administrative Code, Chapter 5, Property and Casualty Insurance, Subchapter A, Automobile Insurance, by adding a new sec.5.401 thereto. sec.5.401. Temporary and Permanent Requirements Regarding Underwriting Treatment of and Disclosure to Applicants For Private Passenger Automobile Liability Insurance. (a) For 120 days from the effective date of this rule, each insurer writing private passenger automobile insurance in Texas shall make available automobile liability insurance coverage to applicants with no prior insurance subject to each insurer's underwriting criteria without consideration of the applicants' lack of prior insurance at each company's or group's lowest applicable rate. (b) For 180 days from the effective date of this rule, each previous "no-prior insurance" applicant who was written in a higher-rated insurance company will be re-underwritten on their renewal date subject to the underwriting criteria of each company to which they apply at each company's or group's lowest applicable rate. (c) Applicants for automobile liability insurance currently or previously insured in a higher-rated insurance company or through the Texas Automobile Insurance Plan (the Assigned Risk Pool) will be underwritten without consideration of the applicant's prior insurance carrier. (d) Insurers or agents who make a quote to an applicant with no prior insurance having no more than one accident and one violation within the past three years, and the quote equals or exceeds the premium available through the Assigned Risk Pool must inform the applicant of coverage available through the Assigned Risk Pool. (e) If any provision of this Section or the application thereof to any person or circumstance is held invalid for any reason, the invalidity shall not affect the other provisions or any other application of said provisions which can be given effect without the invalid provision or application. To this end all provisions of this Section are declared to be severable. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 30, 1991. TRD-9116435 Linda K. von Quintus-Dorn Chief Clerk Texas Department of Insurance Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 463-6327 Subchapter G. Workers' Compensation Insurance 28 TAC sec.5.6701 The State Board of Insurance of the Texas Department of Insurance proposes new sec.5.6701, concerning the establishment of standards, qualifications, and requirements regarding servicing companies necessary to service the Texas Workers' Compensation Insurance Facility (hereinafter Facility). The new section also establishes practices, policies, and procedures for the selection of servicing companies on a competitive basis. Specifically, the new section sets out provisions for the determination of the number of contracts to be awarded, the qualification to bid, bid solicitation, submittal of bids, contract award, requests to reconsider, and allocation of policies to servicing contractors. The new section provides that the State Board of Insurance (hereinafter Board) shall determine an appropriate number of servicing company contracts for which bids are to be solicited. The bid solicitation subsection of the section provides that the board shall advertise for bids in advance of the bid opening date so that bidders will have time to acquire and examine the invitation to bid and prepare a bid. The invitation to bid shall set out all requirements to be met for a bid to be considered responsive, the time and place at which bids will be opened, and the manner in which notice of contract award will be given. The submittal of bids provision sets out the manner in which bids are to be submitted. The contract award subsection provides for the basis upon which the board shall award servicing contracts. Bids will be evaluated on multiple weighted criteria, which shall include, but are not necessarily limited to: demonstrated ability to perform the services required; past experience in performing the same or similar services; demonstrated financial responsibility; and history of compliance with applicable laws and regulations. The requests to reconsider subsection provides that any bidder not awarded a contract may submit a written request to the board for reconsideration. This subsection sets out the information required to be in the request for reconsideration. Oral presentations on a request for reconsideration, limited to one hour in length, may be heard by the board but a bidder is not required to make an oral presentation. If a bidder chooses not to make an oral presentation, the board shall consider only the written materials submitted with the request. The board shall make its decision by vote in open meeting and shall state the reasons for its decision. Once the Board has made its decision, no further requests for reconsideration will be entertained by the board. No contract awarded by the board shall be effective prior to the deadline for submitting requests for reconsideration. The allocation of policies to servicing contractors subsection provides that risks will be assigned so that at any time, to the greatest extent possible, the number of risks and the premium volume will be consistent among all servicing contractors. The Texas Department of Insurance proposes this section because the Texas Insurance Code, Article 5.76-2, sec.4.08 requires the agency to promulgate and adopt rules to implement sec.4.08. Section 4.08 requires the board to establish standards, qualifications, requirements, and all other particulars regarding servicing companies necessary to service the Texas workers' compensation employers' rejected risk fund of the Facility. Section 4.08 also requires the board to establish practices, policies, and procedures for the selection of servicing companies on a competitive basis. This proposed section sets out such standards, qualifications, and requirements for the servicing companies as well as the practices, policies, and procedures for the selection of the servicing companies. Nancy Moore, deputy commissioner for the workers' compensation division, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Ms. Moore, deputy commissioner for the workers' compensation division, also has determined that for each year of the first five years the section are in effect the public benefit anticipated as a result of enforcing the section will be the ability of insureds to obtain insurance through a servicing company who has met specific qualifications and standards. By requiring servicing companies to meet such qualifications and standards, a reasonable degree of certainty exists that such servicing companies will meet the needs of the insureds of the Texas Workers' Compensation Insurance Facility. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Nancy Moore, Deputy Commissioner, Workers' Compensation Division, Mail Code 202-1A, Texas Department of Insurance, P.O. Box 149092, Austin, Texas 78714-9092. The new section is proposed under the Texas Insurance Code, Article 5.76-2, sec.4.08, which authorizes and, in fact, requires the State Board of Insurance to establish standards, qualifications, requirements, and all other particulars regarding servicing companies necessary to service the Texas workers' compensation employers' rejected risk fund of the Facility as well as to establish practices, policies, and procedures for the selection of servicing companies on a competitive basis. sec.5.6701. Workers' Compensation Insurance Bid Procedures. (a) Determination of number of contracts to be awarded. The board shall determine an appropriate number of servicing company contracts for which bids are to be solicited, based on past and anticipated servicing requirements in the Texas Workers' Compensation Insurance Facility. (b) Bid solicitation. (1) The Board shall advertise for bids in the Texas Register
        for the appropriate number of contracts as determined by the board 30 days prior to the bid opening date to allow bidders time to acquire and examine the invitation to bid and to prepare a bid. A copy of the invitation to bid will be furnished to all licensed insurance carriers, all persons on the general services bid list, and to any other prospective bidder who makes such a request. All entities requesting an invitation to bid shall furnish the full name, business address and telephone number of the entity, and the name of a person to whose attention any subsequent addenda or notice be sent. A list shall be kept of all such entities (hereinafter the invitees list). (2) The invitation to bid shall set forth all requirements to be met for a bid to be considered responsive, the time and place at which bids will be opened, and the manner in which notice of contract award will be given. The board, however, reserves the right to alter any such date, time, or place, but shall promptly give written notice of any such changes to all entities on the invitees list. The invitation to bid shall contain a copy of the contract each successful bidder will be required to execute. It shall be presumed that bidders have read and understood the information contained in the invitation to bid, and any addenda thereto, and have given full consideration to all of this information in their bids. (3) The board reserves the right to correct, modify, or amend the invitation to bid by issuing written addenda thereto to all entities on the invitees list, at any time prior to the fifth calendar day next preceding the date of bid opening. (4) Any prospective bidder desiring an explanation or interpretation of the invitation to bid must request it in writing soon enough to allow a reply to reach all prospective bidders before the submission of their bid proposals. Such requests shall be addressed to the deputy commissioner for workers' compensation at the Texas Department of Insurance, P.O. Box 149092, Austin, Texas 78714-9092. Oral inquiries will not be entertained and oral explanations or instructions will not be given. All replies to such requests for explanation or interpretation shall be made by issuing a written addendum to the invitation to bidders, which will be furnished at the same time to all entities on the invitees list. (c) Submittal of bids. (1) All bids submitted must be on the form or forms furnished in the invitation to bidders, or on clear reproduction(s) thereof. (2) Timeliness of submittal is material to the responsiveness of bids. No bids received after the submittal time set out in the invitation to bid shall be accepted. (3) All bids must be signed in order to be considered a responsive bid. The signature on the bid constitutes the bidder's affirmation that the entity submitting the bid has not given, offered to give, nor intends to give at any time thereafter any economic opportunity, favor, gift, loan, special discount, or service to any public servant in connection with the submitted bid. (4) The board reserves the right to waive formalities and minor irregularities in the form and means of submittal of the bids received when the interest of the state shall be served thereby, but if any such irregularity is waived with respect to one bid, it shall be waived with respect to all. (5) Bids may be withdrawn by the bidder at any time prior to bid opening. (6) No alteration in any bid will be permitted after bid opening. (7) All bids are to be submitted in sealed envelopes. Bidders are responsible for identifying these envelopes with sufficient information, as prescribed in the invitation to bidders, to allow them to be identified as bids for servicing contracts. If insufficient or incorrect identification on its envelope results in a bid not being opened, the bid shall be considered nonresponsive. (8) Bids shall be opened by the board in open meeting. The names of the bidders will be announced, but the bids shall not be read aloud. (d) Contract award. (1) The board shall award servicing contracts on a competitive basis. Bids will be evaluated on multiple weighted criteria, which shall include, but are not necessarily limited to, the following: (A) demonstrated ability to perform the services required; (B) past experience in performing the same or similar services; (C) demonstrated financial responsibility; (D) history of compliance with applicable laws and regulations. (2) the criteria to be evaluated, together with the weights to be given each criterion, the method of calculating each bidder's cumulative score, and the minimum score required to be considered eligible for contract award, will be set out in the invitation to bid. Contracts will be awarded to eligible bidders, in order of the highest cumulative weighted scores. The board shall award the number of contracts for which bids were solicited; provided, however, that the board may award a smaller number of contracts than the number for which bids were solicited in the event that the number of eligible bidders is less than the number of contracts solicited. The board reserves the right to reject any and all bids. (3) Subject to subsection (f)(7) of this section, contracts shall be awarded by vote of the board in open meeting. At that meeting, the board shall state its reasons for awarding the contracts to the bidders chosen, and may entertain recommendations relative to the award of contracts from the commissioner of insurance and his or her staff. No contract shall be formed until it has been so awarded. Any bid submitted shall be deemed to be made subject to all the terms and conditions of the written contract included in the invitation to bid, as modified by any subsequent addenda issued according to these rules. Any contract awarded by the board hereunder shall be deemed to incorporate all such terms and conditions. Each successful bidder shall, by and through an individual duly authorized to bind the bidder, execute the written contract included in the invitation to bid, as a reduction to writing of the contract formed by the board's acceptance of its bid, and not as a condition of contract formation. (e) Requests to reconsider. (1) Any bidder not awarded a contract may, not later than 15 days after the board's award of contracts, submit a written request to the board for a reconsideration of its decision (hereinafter request to reconsider). The request shall contain the following: (A) a concise statement of the bidder's reasons for requesting the board to reconsider its failure to award the bidder a contract, and the bidder's reasons why it believes it should be awarded a contract; (B) a precise statement of the relevant facts; (C) identification of any laws, rules, or other legal requirements that the bidder considers have been violated by the board or its designees in the course of bid solicitation and evaluation, and contract award. (2) The bidder may request reconsideration of its bid only as submitted. No additional information required under the invitation to bid that was not included with the bid may be presented at this time, and the bid may not be modified in any way. (3) After receipt of the last timely submitted request to reconsider, the board shall, at its next regularly scheduled open meeting or at any earlier open meeting specially scheduled for the purpose of hearing such requests, hear oral presentations on behalf of any bidder that submitted a timely request for reconsideration. A bidder need not make an oral presentation in order for the board to reconsider its bid, but if an oral presentation is not made, the board shall consider only the written materials submitted with the request. The board may, at its discretion, designate a representative to whom oral presentations will be made (hereinafter designee). In that event, the board shall receive, at the said meeting, a written report from the designee summarizing the oral presentation, and may entertain recommendations for action by the designee. A bidder submitting a request for reconsideration may not communicate with the board, with individual board members, with the designee, or with board staff or attorneys concerning the substance of the request except through the written request itself or oral presentation at an open meeting as provided previously. (4) Oral presentations shall be limited to one hour in length. The board (or the designee) may ask questions during the presentation. Additional written information not presented with the request to reconsider or with the bid itself will not be received from or on behalf of the bidder submitting the request at the time of presentation, or thereafter. (5) The board may announce its decision regarding any request to reconsider at the meeting in which the presentation is made, or it may defer the decision until its next regularly scheduled open meeting, or a meeting specially scheduled for the purpose. The board shall make its decision by vote in open meeting, and shall state the reasons for its decision. (6) No further requests for reconsideration will be entertained by the board following the announcement of its decision, but the bidder may ask the board for a written statement of the board's reasons for its decision and/or the report submitted by the designee. Such a request may be made orally at the time the oral presentation in support of the request to reconsider is made, (either to the board or to the designee), or it may be made in writing not later than the seventh calendar day next following the board's announcement of its decision of the request to reconsider. (7) No contract awarded by the board shall be effective prior to the deadline for submitting requests for reconsideration. All such contracts shall be deemed effective as of the expiration of the period for submittal of requests for reconsideration, if no requests are received within that period. If one or more requests are timely submitted, and the board has voted to award the full number of contracts for which bids were solicited, no such contract shall be effective, and no bidder awarded a contract shall have any right thereunder, until the board has announced its decision on all requests for reconsideration, at which time all contracts awarded shall become effective, consistent with the board's decision on the requests for reconsideration. The same applies if the board has voted to award fewer than the number of contracts for which bids were solicited, and the number of timely submitted requests for reconsideration exceeds the difference between the number of contracts awarded and the number for which bids were solicited. If the board has voted to award fewer than the number of contracts for which bids were solicited, and the number of timely submitted requests for reconsideration is less than the difference between the number of contracts awarded and the number for which bids were solicited, all contracts awarded by the board shall be effective as of the date of the award. (f) Allocation of policies to servicing contractors. Risks will be assigned by Texas Workers' Compensation Insurance Facility staff to servicing contractors under their contracts. Risks will be assigned so that at any time, to the greatest extent possible, the number of risks and the total premium volume allocated to each servicing contractor shall be the same as the number and total value of policies allocated to every other Servicing Contractor. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 31, 1991. TRD-9116466 Linda K. von Quintus-Dorn Chief Clerk Texas Department of Insurance Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 463-6327 TITLE 34. PUBLIC FINANCE Part I. Comptroller of Public Accounts Chapter 3. Tax Administration Subchapter A. General Rules 34 TAC sec.3.5 (Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the Comptroller of Public Accounts or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.) The Comptroller of Public Accounts proposes the repeal of sec.3.5, concerning settlement of tax, penalty, or interest. The purpose of the repeal is to return penalty and interest issues to the hearings process. The amendment will be applied prospectively. Only penalty and interest waiver denials occuring on or after the effective date of the amendment may be appealed through the hearings process. Tom Plaut, chief revenue estimator, has determined that the repeal of the section will not result in any fiscal implications to the state or local government. This repeal is promulgated under the Tax Code, Title 2, and does not require a statement of fiscal implications for small businesses. Dr. Plaut also has determined that there will be no cost or benefit to the public from the repeal of this section. There is no anticipated economic cost to persons who are required to comply with the proposed repeal. Comments on the repeal may be submitted to Lucy Glover, Manager, Tax Administration Division, P.O. Box 13528, Austin, Texas 78711. The repeal is proposed under the Tax Code, sec.111.002, which provides the Comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2. sec.3.5. Settlement of Tax, Penalty, or Interest. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 30, 1991. TRD-9116425 Martin Cherry General Law Section Comptroller of Public Accounts Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 463-4028 The Comptroller of Public Accounts proposes new sec.3.5, concerning waiver of penalty or interest. The new section, which will be applied prospectively, returns the final consideration of penalty and interest waiver requests to the administrative hearings process and sets out factors that will be considered when reviewing waiver requests. Tom Plaut, chief revenue estimator, has determined that for the first five-year period the proposed section will be in effect there will be no significant revenue impact on the state or local government as a result of enforcing or administering the section. This section is adopted under the Tax Code, Title 2, and does not require a statement of fiscal implications for small businesses. Dr. Plaut also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be in providing new information regarding tax responsibilities. There is no anticipated economic cost to persons who are required to comply with the proposed section. Comments on the new section may be submitted to Lucy Glover, Manager, Tax Administration Division, P.O. Box 13528, Austin, Texas 78711. The new section is proposed under the Tax Code, sec.111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2. sec.3.5. Waiver of Penalty or Interest. (a) Procedure for requesting waiver, audits. (1) Penalty or interest on an audit liability may be waived if the taxpayer exercised reasonable diligence to comply with the tax laws of this state. A request to waive penalty or interest will be presumed in all cases governed by this subsection. (2) The comptroller has delegated to the audit manager the initial authority to waive penalty and interest in appropriate cases. At the exit conference, the taxpayer will be told whether any penalty or interest will be waived. At this conference the taxpayer may request the audit manager to reconsider his/her decision on penalty or interest waiver. (3) The taxpayer will be advised of the audit manager's acceptance or rejection of the request for waiver of penalty or interest in the audit cover letter sent with the copy of the audit schedules. (4) If a taxpayer's request for waiver is denied at the audit level, the taxpayer may raise the issue as a contested case matter during either a refund or redetermination hearing. (b) Procedure for requesting waiver, non-audit. (1) The comptroller has delegated to the Revenue Accounting Division the initial authority to waive penalty and interest when returns and reports are filed past the due dates. (2) Penalty or interest on a non-audit liability may be waived if the taxpayer exercised reasonable diligence to comply with the tax laws of this state. A written request stating the reasons penalty and interest should be waived must be sent to the comptroller's Revenue Accounting Division accompanied by supporting documentation. The comptroller may require the production of any additional documentation necessary to evaluate a request. (3) The Revenue Accounting Division will inform the taxpayer of the division's decision regarding the waiver request after considering: (A) whether the taxpayer is current in the filing of all returns; (B) whether the taxpayer is current in the payment of all taxes and fees due the state; (C) whether penalty or interest has been waived on other occasions; denied; (D) why penalty or interest was previously waived or denied; (E) whether the taxpayer has a good record of timely filing and paying past returns; and (F) whether the taxpayer has taken the necessary steps to correct the problem for future filings. (4) A taxpayer may request an administrative appeal with the Revenue Accounting Division of a denial of a waiver request within 10 calendar days from the date of written notification of the denial. Such a request for an administrative appeal must be in writing and contain all new or additional documentation upon which the taxpayer relies. (5) The taxpayer will be sent written notification from the Revenue Accounting Division of the disposition of the appeal within 30 days of either the comptroller's receipt of the request for an appeal or the comptroller's receipt of all additional information requested from the taxpayer in relation to the appeal. (6) If a taxpayer's request for waiver is denied by the Revenue Accounting Division, the taxpayer may raise the issue as a contested case matter during either a refund or redetermination hearing. (c) Penalty. When reviewing a penalty waiver request under subsection (a) of this section or in a contested case, the following factors regarding a taxpayer's account will be considered: (1) the taxpayer's audit history; (2) the tax issues involved; (3) a change in comptroller policy during the audit period; (4) size and sophistication of the taxpayer; (5) whether tax was collected but not remitted; (6) whether returns were timely filed; (7) completeness of records; (8) delinquencies in other taxes; and (9) reliance on advice provided by the comptroller's office which caused imposition of penalty and interest. (d) Interest. When reviewing an interest waiver request under subsection (a) of this section or in a contested case, the following factors regarding a taxpayer's account will be considered: (1) undue delay caused by comptroller personnel; (2) reliance on advice provided by the comptroller's office which caused imposition of penalty and interest; and (3) natural disasters. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 30, 1991. TRD-9116424 Martin Cherry Chief, General Law Section Comptroller of Public Accounts Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 463-4028 Chapter 7. Administration of State Lottery Act Subchapter B. Licensing of Sales Agents 34 TAC sec.7.151 The Comptroller of Public Accounts proposes new sec.7.151, concerning general rules governing the licensing of sales agents to sell lottery tickets pursuant to the State lottery Act. Tom Plaut, chief revenue estimator, has determined that for the first five-year period the proposed section will be in effect there will be no significant revenue impact on the state or local government. This section is adopted under the State Lottery Act, sec.2.02, and does not require a statement of fiscal implications for small businesses. Dr. Plaut also has determined that for each year of the first five years the section is in effect there would be no significant public cost or benefit. There is no anticipated economic cost to persons who are required to comply with the proposed section. Comments on the new section may be submitted to Nora Linares, Director, Lottery Division, Comptroller of Public Accounts, Austin, Texas 78774. The new section is proposed under the State Lottery Act, s2.02, which provides the comptroller with the authority to adopt all rules necessary to administer the State Lottery Act. sec.7.151. General Rules. (a) No person may sell lottery tickets at any location unless that person has in effect a license issued in accordance with the State Lottery Act and this subchapter. (b) Licensees and applicants for a license under this subchapter must be engaged in a business separate and apart from that of sales agent in order to avoid revocation or denial of such license or license application. (c) No license issued under this subchapter may be transferred or assigned to any other person or location. (d) A separate license is required for each location at which tickets are to be sold. A person who desires to operate more than one location to sell tickets must submit separate information for each location in such form as the director may require in the application. (e) Except as provided in this subsection, an applicant or sales agent shall notify the director of any change in the information in the applicant's or sales agent's most recent application for a license or renewal of a license under this subchapter. The applicant or sales agent shall notify the director of the change in the information within 10 days following the date of the change. Notwithstanding the preceding sentence, a corporate applicant or sales agent is not required to notify the director under this subsection of a transfer of less than 10% of the corporate stock unless the transfer result in a shareholder who previously held 10% or less of the stock holding more than 10% of the stock. (f) Unless otherwise indicated, all terms used in this subchapter shall have the same meaning as assigned to them under the State Lottery Act, either expressly or through reference to the context in which such terms are used in that Act. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 31, 1991. TRD-9116469 Charles Johnstone Senior Legal Counsel, General Law Section Comptroller of Public Accounts Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 463-4028 34 TAC sec.7.152 The Comptroller of Public Accounts proposes new sec.7.152, concerning general matters to be complied with in an application for sales agent license submitted pursuant to the State Lottery Act. Tom Plaut, chief revenue estimator, has determined that for the first five-year period the proposed section will be in effect there will be no significant revenue impact on the state or local government. This section is adopted under the State Lottery Act, sec.2.02, and does not require a statement of fiscal implications for small businesses. Dr. Plaut also has determined that for each year of the first five years the section is in effect there would be no significant public cost or benefit. There is no anticipated economic cost to persons who are required to comply with the proposed section. Comments on the new section may be submitted to Nora Linares, Director, Lottery Division, Comptroller of Public Accounts, Austin, Texas 78774. The new section is proposed under the State Lottery Act, s2.02, which provides the comptroller with the authority to adopt all rules necessary to administer the State Lottery Act. sec.7.152. Application for License. (a) An applicant for a license under this subchapter must apply to the division using forms provided by the division. The director may determine not to consider any application unless all requested information has been supplied by the applicant. (b) The director shall develop all forms and related documents including, but not limited to, an application form, release form to obtain a credit report, and/or any other background information relating to the applicant required to determine the applicant's eligibility for a license an whether the granting of a license to the applicant will best serve the public convenience. An applicant must disclose all criminal convictions for those individuals of whom an investigation is authorized under the State Lottery Act, sec.3.06, and which are requested in the application. (c) An applicant shall, under penalty of perjury, complete, sign, date, and submit all forms and related information and documents required. By signing and submitting the application form, the applicant agrees to allow the director to investigate the credit, criminal, and tax background of the applicant and other matters as authorized under the Act. (d) Every license application submitted to the director under this subchapter shall be accompanied by an application fee in an amount to be established by the director. If the director denies an application based on a factor listed in sec.7.153(a) of this title (relating to Qualifications for License), the director shall refund one half of the application fee to the applicant. If the director denies an application based on another factor, the director shall not refund any part of the application fee. (e) Every license application submitted to the director under this subchapter shall be accompanied by security as authorized by the State Lottery Act, sec.2.02(e), in a form and amount determined by the director. If the director determines that the purposes of the Act would be best served through establishment and maintenance of a pooled fund for purposes of reimbursing the division for losses arising from the operation of licensed sales agents, the director may require security in the form of a mandatory contribution by each applicant. Any amount so contributed shall be refunded by the director to the applicant upon denial of the related application for any reason. The amount of any such contribution may, at the director's discretion, be refunded after receipt of a license by an applicant under this subchapter, if the licensee does not sell a ticket while licensed. Once a licensee has begun ticket sales under said license, that licensee's contribution under this subsection may not be refunded. (f) All applications submitted under this subchapter shall be available for public inspection during business hours, provided that criminal history information and other information confidential by law shall not be available for inspection. Any person seeking to inspect any application shall furnish a written request to the director specifically stating the information sought to be inspected. The director may respond to such requests orally or in writing in order to arrange for the inspection of the requested documents after a reasonable time is allowed for the division to review the documents and delete confidential information. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 31, 1991. TRD-9116470 Charles Johnstone Senior Legal Counsel, General Law Section Comptroller of Public Accounts Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 463-4028 34 TAC sec.7.153 The Comptroller of Public Accounts proposes new sec.7.153, concerning general criteria to be considered by the director of the lottery division in determining the eligibility of applicants to be licensed as sales agents for the sale of lottery tickets pursuant to the State Lottery Act. Tom Plaut, chief revenue estimator, has determined that for the first five-year period the proposed section will be in effect there will be no significant revenue impact on the state or local government. This section is adopted under the State Lottery Act, sec.2.02, and does not require a statement of fiscal implications for small businesses. Dr. Plaut also has determined that for each year of the first five years the section is in effect there would be no significant public cost or benefit. There is no anticipated economic cost to persons who are required to comply with the proposed section. Comments on the new section may be submitted to Nora Linares, Director, Lottery Division, Comptroller of Public Accounts, Austin, Texas 78774. The new section is proposed under the State Lottery Act, s2.02, which provides the comptroller with the authority to adopt all rules necessary to administer the State Lottery Act. sec.7.153. Qualifications for License. (a) Before issuing a license to any person under this subchapter, the director shall consider: (1) the financial responsibility and security of the applicant and the business or activity in which the applicant is engaged. Consideration of this factor may include the analysis of the applicant's credit record, compliance with tax laws of other jurisdictions, status of permits and licenses, results of criminal background check, adequacy of security procedures against theft, whether the location is fixed and permanent, whether the applicant can provide appropriate security, and any other factor that may assist the director in such evaluation; (2) the public accessibility of the applicant's place of business or activity. Consideration of this factor may include analysis of the applicant's hours of operation, proximity to major transit routes, proximity to large employers, public parking availability, and any other factor that may assist the director in such evaluation; (3) the sufficiency of existing sales agents to serve the public convenience. Consideration of this factor may include analysis of number and proximity of other sales agents in a given market area, and/or number of "minority businesses" (as that term is defined in the State Lottery Act, sec.2.06(b)) licensed in a given market area, with the possibility that additional licenses for any given market area may be denied if the area is determined to be adequately served by existing licensees; (4) whether individuals under 18 years of age constitute a majority of the applicant's customers or as customers provide a majority of the applicant's sales volume; and (5) any other factor that is helpful in determining whether the applicant's experience, character, and general fitness are such that the applicant's participation as a sales agent will not detract from the integrity, security, honesty, or fairness of the operation of the lottery. An example of the type of factor considered in this regard is the analysis of the type of product sold or form of service provided by the applicant. (b) The director may grant or deny an application for a license under this subchapter based on any one or more factors listed in subsection (a) of this section. In addition, the director shall deny an application for a license under this subchapter upon a finding that the applicant: (1) has been convicted of a felony, criminal fraud, gambling or a gambling- related offense, or a misdemeanor involving moral turpitude, if less than 10 years has elapsed since the termination of the sentence, parole, mandatory supervision, or probation served for the offense; (2) is or has been a professional gambler. A "professional gambler" is a person whose profession is, or whose major source of income derives from, playing games of chance for profit; (3) is delinquent in the payment of any state tax at any time after the application is filed but before the director acts to grant or deny the license; (4) has a spouse, child, parent, parent-in-law, or spouse's child who is a person described in paragraph (1), (2), or (3) of this subsection; (5) has violated the Act or a rule adopted by the comptroller in furtherance of the Act; (6) is not an individual, and an individual described in one or more of paragraphs (1)-(5) of this subsection: (A) is an officer or director of the applicant; (B) holds more than 10% of any class of issued and outstanding stock in the applicant; (C) holds an equitable ownership interest greater than 10% in the applicant; (D) is a creditor of the applicant to the extent of more than 10% of the applicant's outstanding debt at any time after the application is filed but before the director acts to grant or deny the license; (E) is the owner or lessee of a business that the applicant conducts or through which the applicant will conduct a ticket sales agency; (F) shares or will share in the profits, other than stock dividends, of the applicant or sales agent; (G) participates in managing the affairs of the applicant; (H) is an employee of the applicant who is or will be involved in selling tickets or handling money from the sale of tickets; (7) provided false or misleading information on the application form, or failed to provide information required as part of the application; (8) failed to provide fingerprint identification for individuals for which such identification is requested in a form acceptable to the division following the division's request for such identification; (9) has previously had a sales agent's license revoked, unless the director is satisfied the person will comply with the Act and the rules under this subchapter; or (10) failed to certify to the director the applicant's compliance with the federal Americans With Disabilities Act. (c) Without limiting the foregoing grounds for denial of a license under this subchapter, the director shall deny a license to any person whose location for the sales agency is either: (1) a racetrack at which wagering is authorized under the Texas Racing Act (Texas Civil Statutes, Article 179e); (2) a location licensed for games of bingo under the Bingo Enabling Act (Texas Civil Statutes, Article 179d); (3) on land owned by the State of Texas or a political subdivision of this state, other than land used as a mass transportation facility that is used by commercial carriers; or (4) a location for which a person holds a wine and beer retailer's permit, mixed beverage permit, mixed beverage late hours permit, private club registration permit, or private club late hours permit issued under the Alcoholic Beverage Code, Chapter 25, 28, 29, 32, or 33. (d) Any applicant whose applicant is denied under this subchapter or who is granted a license the terms of which are more restricted than those applied for, shall be notified by the director in writing of the denial or restriction and of the reasons therefor. The applicant may appeal the director's decision in accordance with rules adopted by the comptroller for that purpose. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 31, 1991. TRD-9116471 Charles Johnstone Senior Legal Counsel, General Law Section Comptroller of Public Accounts Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 463-4028 34 TAC sec.7.154 The Comptroller of Public Accounts proposes new sec.7.154, concerning certain terms to be included in licenses issued to sales agents for the purpose for selling lottery tickets pursuant to the State Lottery Act. Tom Plaut, chief revenue estimator, has determined that for the first five-year period the proposed section will be in effect there will be no significant revenue impact on the state or local government. This section is adopted under the State Lottery Act, sec.2.02, and does not require a statement of fiscal implications for small businesses. Dr. Plaut also has determined that for each year of the first five years the section is in effect there would be no significant public cost or benefit. There is no anticipated economic cost to persons who are required to comply with the proposed section. Comments on the new section may be submitted to Nora Linares, Director, Lottery Division, Comptroller of Public Accounts, Austin, Texas 78774. The new section is proposed under the State Lottery Act, s2.02, which provides the comptroller with the authority to adopt all rules necessary to administer the State Lottery Act. sec.7.154. Issuance of License; Terms. (a) A license issued under this subchapter may by its terms limit the type of games and/or method of sales authorized by the license. A determination of appropriate limitations on any license are within the director's sole discretion, provided that the director shall furnish the licensee with a written explanation of the reasons for any such limitations. (b) Each sales agent licensed under this subchapter shall prominently display the license in each place of business or activity at which the sales agent sells tickets. (c) As a condition to the issuance of a license under this subchapter, an applicant shall first furnish security in a form and amount approved by the director. The director may waive or reduce the amount of security required, if feasible after consideration of whether the applicant is a minority business, the possible loss to the state from the operation of the licensee, or any other factor the director finds relevant to such a determination. The director may also require a sales agent to maintain insurance if necessary to protect the state's interests. If the director determines that the integrity, security, honesty, or fairness in the operation and administration of the lottery will best be served through establishment and maintenance of a pooled fund to be used to reimburse the state for losses of revenue from the operation of sales agents, the director may require security in the form of a mandatory contribution by each licensee to such a fund. Depending upon the losses required to be reimbursed by such a fund, the director may require additional contributions to such a fund as a term of a any license renewal under this subchapter. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 31, 1991. TRD-9116472 Charles Johnstone Senior Legal Counsel, General Law Section Comptroller of Public Accounts Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 463-4028 34 TAC sec.7.155 The Comptroller of Public Accounts proposes new sec.7.155, concerning the expiration of a sales agent license issued pursuant to the State Lottery Act. Tom Plaut, chief revenue estimator, has determined that for the first five-year period the proposed section will be in effect there will be no significant revenue impact on the state or local government. This section is adopted under the State Lottery Act, sec.2.02, and does not require a statement of fiscal implications for small businesses. Dr. Plaut also has determined that for each year of the first five years the section is in effect there would be no significant public cost or benefit. There is no anticipated economic cost to persons who are required to comply with the proposed section. Comments on the new section may be submitted to Nora Linares, Director, Lottery Division, Comptroller of Public Accounts, Austin, Texas 78774. The new section is proposed under the State Lottery Act, s2.02, which provides the comptroller with the authority to adopt all rules necessary to administer the State Lottery Act. sec.7.155. Expiration of License. (a) A license issued under this subchapter shall expire upon the earliest to occur of the following; (1) two years following the date of issuance, unless an earlier expiration date is specified in the license; (2) suspension of the license; (3) revocation of the license; (4) death of the licensee, if an individual; (5) dissolution of a sales agent that is not an individual; or (6) bankruptcy or recivership of a sales agent. (b) Upon expiration of the license, the licensee must immediately surrender to an authorized representative of the division the license and all division property, return to the division all unsold tickets in accordance with normal division policy, pay any funds owed to the division by an authorized method, and take such further action as required by the director. (c) If a license expires under paragraphs (4), (5), or (6) of subsection (a) of this section and the sales agent's successor in interest desires to operate the sales agency, the successor must file an application for an extended license not later than the 30th day after the date the license expired. The application must state the basis for the applicant's claim to be the successor in interest to the sales agent, and must contain a certification that the applicant would be eligible for a license under this subchapter. The director shall permit a qualified applicant to operate under an extended license for not more than one year or until a new license is issued to the applicant, whichever occurs first. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 31, 1991. TRD-9116473 Charles Johnstone Senior Legal Counsel, General Law Section Comptroller of Public Accounts Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 463-4028 34 TAC sec.7.156 The Comptroller of Public Accounts proposes new sec.7.156, concerning certain requirements associated with the renewal of a sales agent license submitted pursuant to the State Lottery Act. Tom Plaut, chief revenue estimator, has determined that for the first five-year period the proposed section is in effect there will be no significant revenue impact on the state or local government. This section is adopted under the State Lottery Act, sec.2.02, and does not require a statement of fiscal implications for small businesses. Dr. Plaut also has determined that for each year of the first five years the section is in effect there would be no significant public cost or benefit. There is no anticipated economic cost to persons who are required to comply with the proposed section. Comments on the new section may be submitted to Nora Linares, Director, Lottery Division, Comptroller of Public Accounts, Austin, Texas 78774. The new section is proposed under the State Lottery Act, s2.02, which provides the comptroller with the authority to adopt all rules necessary to administer the State Lottery Act. sec.7.156. Renewal of License. (a) A license issued under this subchapter may be considered for renewal by filing a renewal application with the director. In order to be considered, the renewal application must be received by the director no later than 30 days prior to the expiration date of the existing license. Information not filed with the director on or prior to the 30th day prior to the date of expiration of an applicant's license shall not be accepted for consideration in connection with the applicant's renewal application. (b) The renewal application shall be on forms provided by the division upon request. All provisions in this subchapter governing the applicant's completion and submission of a license application and conditions of the license granted shall apply equally to the application for and renewal of a license. Factors considered by the director and grounds for denying the renewal of a license may include those listed in sec.7.153(a) or (b) of this title (relating to Qualifications for License) and those listed under sec.7.158(b) of this title (relating to Suspension or Revocation of License). (c) Every application for renewal of a license submitted under this subchapter shall be accompanied by a renewal fee in an amount to be established by the director. If the director denies an application for renewal based on a factor listed in sec.7.153(a) of this title (relating to Qualifications for License), the director shall refund one half of the renewal application fee to the applicant. If the director denies an application based on another factor, the director may not refund any part of the renewal application fee. (d) Every application for renewal of a license submitted under this subchapter shall be accompanied by security in an amount and in such form as the director determines to be in the best interests of the lottery. If the director determines that such security is best provided through mandatory contributions by licensees to a pooled fund established and maintained to reimburse the state for losses resulting from the operation of sales agents, the amount of such security shall be determined based on the director's estimate of expected required reimbursement to the state from such losses incurred during the term of the renewal. (e) A renewal license issued under this section shall be valid for a term set by the director, unless it expires sooner. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 31, 1991. TRD-9116474 Charles Johnstone Senior Legal Counsel, General Law Section Comptroller of Public Accounts Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 463-4028 34 TAC sec.7.157 The Comptroller of Public Accounts proposes new sec.7.157, concerning temporary license. The new section relates to the issuances of temporary licenses to applicants to become sales agents authorized to sell lottery tickets pursuant to the State Lottery Act. Tom Plaut, chief revenue estimator, has determined that for the first five-year period the proposed section is in effect there will be no significant revenue impact on the state or local government. This section is adopted under the State Lottery Act, sec.2.02, and does not require a statement of fiscal implications for small businesses. Dr. Plaut also has determined that for each year of the first five years the section is in effect there will be no significant public cost or benefit. There is no anticipated economic cost to persons who are required to comply with the proposed section. Comments on the new section may be submitted to Nora Linares, Director, Lottery Division, Comptroller of Public Accounts, Austin, Texas 78774. The new section is proposed under the State Lottery Act, s2.02, which provides the comptroller with the authority to adopt all rules necessary to administer the State Lottery Act. sec.7.157. Temporary License.
          In addition to and without limiting the director's ability to issue licenses pursuant to sec.7.154 of this title (relating to Issuance of License; Terms), the director may issue temporary licenses to applicants to become sales agents. A temporary license shall expire on the date specified on the license, but in no event later than September 1, 1993. A temporary license is subject to suspension in accordance with procedures established by rules issued by the comptroller under this title upon the comptroller's finding of any factor under sec.7.153(b) of this title (relating to Qualifications for License); sec.7.158 of this title (relating to Suspension or Revocation of License); or sec.7.159 of this title (relating to Summary Suspension of License). The denial of an application for a temporary license does not entitle the applicant to a hearing. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 31, 1991. TRD-9116475 Charles Johnstone Senior Legal Counsel, General Law Section Comptroller of Public Accounts Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 463-4028 34 TAC sec.7.158 The Comptroller of Public Accounts proposes new sec.7.158, concerning suspension or revocation of license. The new section sets forth the circumstances under which the comptroller may suspend or revoke the license of a sales agent issued pursuant to the State Lottery Act. Tom Plaut, chief revenue estimator, has determined that for the first five-year period the proposed section will be in effect there will be no significant revenue impact on the state or local government. This section is adopted under the State Lottery Act, sec.2.02, and does not require a statement of fiscal implications for small businesses. Dr. Plaut also has determined that for each year of the first five years the section is in effect there would be no significant public cost or benefit. There is no anticipated economic cost to persons who are required to comply with the proposed section. Comments on the new section may be submitted to Nora Linares, Director, Lottery Division, Comptroller of Public Accounts, Austin, Texas 78774. The new section is proposed under the State Lottery Act, s2.02, which provides the comptroller with the authority to adopt all rules necessary to administer the State Lottery Act. sec.7.158. Suspension or Revocation of License. (a) The comptroller may propose to suspend or revoke any license issued under this subchapter if he finds that any factor listed as grounds for denial of a license under sec.7.153(b) of this title (relating to Qualifications for License) or any factor listed in subsection (b) of this section apply to the licensee. The comptroller shall advise the sales agent in writing of the decision to suspend or revoke and of the reasons therefor. In addition, if the event of a license suspension under this section, the director shall also advise the licensee of the terms under which the suspended license may be reissued. (b) Without limiting the comptroller's ability to consider factors listed in sec.7.153(b) of this title (relating to Qualifications for License) as grounds for suspension or revocation of a license issued under this subchapter, the comptroller may also propose to suspend or revoke a license based on finding any of the following: (1) that the ownership of the business premises has changed or the business location of the retailer has changed without at least 10 days prior notice and approval of the director; (2) that the licensee has sold a lottery ticket or paid a prize to a person under 18 years of age; (3) that the licensee has not prominently displayed the license issued under this subchapter at the licensed location; (4) that the licensee has not promoted the sale of lottery tickets by failing to prominently display or make accessible and/or available, lottery game point-of- sale advertising or other public information material; (5) that the licensee has redeemed a lottery prize in an amount greater or less than the authorized amount; conditioned redemption of a lottery prize upon the purchase of any other item or service; or imposed any restriction upon the redemption of a lottery prize not specifically authorized by the director; (6) that the licensee has violated any directive or instruction issued by the director; (7) that the licensee has violated any express term or condition of its license not specifically set forth in this subchapter; (8) that the licensee and/or its employee(s) has exhibited discourteous treatment including, but not limited to, abusive language toward contractors, customers, or division employees; (9) that the licensee has assigned or transferred, or attempted to assign or transfer its license to another party without the prior approval of the director; (10) that the licensee has failed to exercise due care in the treatment of division property; (11) that the licensee endangered the security of the lottery; (12) that the licensee engaged in fraud, deceit, misrepresentation, or other conduct prejudicial to public confidence in the lottery; (13) that the licensee engaged in telecommunication or printed advertising that the director determines to have been false, deceptive, or misleading; (14) that the licensee failed to follow instructions and procedures for the conduct of any particular lottery game or lottery special event; (15) that the licensee failed to establish or maintain reasonable security precautions with regard to the handling of lottery tickets and other materials; and/or (16) that the licensee has incurred three notices of non-sufficient funds within a 12-month period. (c) In the event the comptroller proposes the suspension or revocation of a sales agent's license under this section, the sales agent may appeal the comptroller's decision in accordance with rules issued by the comptroller under this title for that purpose. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 31, 1991. TRD-9116476 Charles Johnstone Senior Legal Counsel, General Law Section Comptroller of Public Accounts Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 463-4028 34 TAC sec.7.159 The Comptroller of Public Accounts proposes new sec.7.159, concerning summary suspension of license. The new section sets forth the circumstances under which the comptroller may summarily suspend a sales agent's license issued pursuant to the State Lottery Act. Tom Plaut, chief revenue estimator, has determined that for the first five-year period the proposed section is in effect there will be no significant revenue impact on the state or local government. This section is adopted under the State Lottery Act, sec.2.02, and does not require a statement of fiscal implications for small businesses. Dr. Plaut also has determined that for each year of the first five years the section is in effect there will be no significant public cost or benefit. There is no anticipated economic cost to persons who are required to comply with the proposed section. Comments on the new section may be submitted to Nora Linares, Director, Lottery Division, Comptroller of Public Accounts, Austin, Texas 78774. The new section is proposed under the State Lottery Act, s2.02, which provides the comptroller with the authority to adopt all rules necessary to administer the State Lottery Act. sec.7.159. Summary Suspension of License. (a) In addition to the authority to suspend a sales agent's license pursuant to sec.7.158 of this title (relating to Suspension or Revocation of License), the comptroller may suspend a sales agent's license subject to the limited notice and hearing procedures established under other rules to be adopted by the comptroller under this title for that purpose, if the comptroller finds that the action is necessary to maintain the integrity, security, honesty, or fairness of the operation or administration of the lottery or to prevent financial loss to the state, and: (1) the sales agent fails to deposit money received from ticket sales under the State Lottery Act, sec.5.01; (2) an event occurs that would render the sales agent ineligible for a license under sec.7.153(b) of this title (relating to Qualifications for License); (3) the sales agent refuses to permit the director, the comptroller, or the state auditor to examine the agent's books, records, papers, or other objects or refuses to answer any question authorized under the State Lottery Act, sec.2.02(j); or (4) the director learns the sales agent has failed to disclose information that would, if disclosed, render the sales agent ineligible for a license under sec.7.153(b) of this title (relating to Qualifications for License). (b) A summary suspension properly commenced under rules adopted by the comptroller under this title is effective at the time the notice is served. If notice is personally served, the licensee shall immediately surrender the license to the comptroller or his representative. If notice is served by mail, the licensee shall immediately return the license to the comptroller. In addition, at the time the licensee is served with notice under this subsection, the licensee may be required by the director to surrender to an authorized representative of the division all division property, return all unsold tickets in accordance with normal division policy, pay funds owed to the division by an authorized method, and take such further action as required by the director. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 31, 1991. TRD-9116477 Charles Johnstone Senior Legal Counsel, General Law Section Comptroller of Public Accounts Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 463-4028 Chapter 9. Property Tax Administration Subchapter A. Practice and Procedure 34 TAC sec.sec.9.7-9.14 The Comptroller of Public Accounts proposes new sec.sec.9.7-9.14, concerning protests by school districts, county education districts, certain property owners, and appraisal districts of its property value study's preliminary findings. The new sections are necessary because new legislation transferred responsibility for conducting the property value study and property value study protests to the comptroller. The new sections clearly describe the agency's protest procedures, including how a petitioner may file a protest petition; the hearing examiner's powers; how a hearing is conducted; procedures for issuing a proposed decision and filing exceptions; when a proposed decision becomes final; and the date on which changes to the preliminary findings must be certified to the commissioner of education. Tom Plaut, chief revenue estimator, has determined that for the first five-year period the proposed sections will be in effect there will be no significant revenue impact on the state or local government as a result of enforcing or administering the sections. Dr. Plaut also has determined that for each year of the first five years the sections are in effect the public benefit anticipated as a result of enforcing the sections as proposed will be that petitioners will benefit from having clearly described procedures for protesting, conducting hearings, and reaching a final decision concerning protests of the preliminary findings of the property value study. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the proposed sections. Comments on the new sections may be submitted to Barbara Truesdale, Manager, Property Tax Division, 4301 Westbank Drive, Austin, Texas 78746-6565. The new sections are proposed under the Education Code, s11.86(e), which provides the comptroller with the authority to adopt procedural rules governing the conduct of protest hearings. sec.9.7. Additional General Provisions. (a) An error in a district's annual report of property value may be corrected by timely filing a petition on a form supplied by the comptroller and otherwise complying with the requirements of this section. (b) A petitioner shall send notice of its intent to protest to each district and appraisal district that may be affected by the outcome of the protest. Certification of service to each entity shall accompany the petition. Failure to provide certification of service is grounds for dismissal. (c) A petitioner may submit additional evidence supporting the petition if the information is requested, orally or in writing, after the deadline to file a petition has passed and before the date set for the petitioner's protest hearing, by a comptroller employee involved in the proceeding. (d) At any time before the date final changes in the preliminary findings are certified to the commissioner of education, the comptroller may certify to the commissioner of education amended preliminary findings. If the comptroller certifies amended preliminary findings that are adverse to the district, the appraisal district's, property owner's, and district's, time to protest begins to run on the date the amended preliminary findings are certified. (e) A petition shall be on a form supplied by the comptroller showing the petitioner's name and address, designating the petitioner's agent, and listing for each category of property the reasons for disagreement with the preliminary findings for that category. The petition shall include the following information: (1) all documentary evidence, placed in order by category, necessary to support the factual and legal contentions made in the petition; and (2) the value, stated by category, petitioner claims is correct, however, the value claimed to be correct may not be less than the tax roll value for the category for the year of the study. (f) A petition must be signed by: (1) the superintendent of the district if it is a petition filed by a school district; or (2) the chairman of the board of trustees if it is a petition filed by a county education district; or (3) the property owner if it is a petition filed by a property owner; or (4) the chief appraiser of the appraisal district, if it is a petition filed by an appraisal district. (g) The petition must contain a sworn statement by the person signing the petition that, to the best of his knowledge, the evidence contained in the petition is true and correct. (h) Before a scheduled protest hearing the comptroller or a petitioner may request a preliminary conference to clarify the issues or resolve the protest. If the request is accepted, the conference shall be scheduled during business hours at the offices of the comptroller or at a time mutually agreeable to the comptroller and the petitioner. A hearing examiner may not attend a preliminary conference. (i) In a protest by an appraisal district, the appraisal district has the burden of proving by a preponderance of the evidence in what respect the comptroller's appraisal district measures, as defined in sec.9.3 of this title (relating to Definitions), are correct. sec.9.8. Scheduling a Protest Hearing. On receiving a petition, the hearing examiner shall determine whether the petition raises issues that are within the comptroller's jurisdiction. The hearing examiner shall deliver notice of the date, time, and place fixed for a hearing to each petitioner's agent. The notice must be delivered not later than 10 days before the date of the hearing and must be provided to each petitioner's agent. sec.9.9. Hearing Examiner's Powers. (a) Hearing examiner. The hearing examiner shall conduct a protest hearing in a manner insuring the fairness, the reliability of evidence, and the timely completion of the hearing. The hearing examiner shall have the authority necessary to receive and consider all evidence, propose decisions, consider exceptions and replies to exceptions, and amend a proposed decision. The hearing examiner's authority includes, but is not limited to, the following: (1) establish the comptroller's jurisdiction concerning the protest, including whether a timely protest has been filed or whether an extension to time should be granted; (2) set hearing dates; (3) rule on motions and the admissibility of evidence; (4) designate parties and establish the order of presentation of evidence; (5) consolidate related protests; (6) conduct hearings in an orderly manner; (7) administer oaths to all persons presenting testimony; (8) examine witnesses and comment on the evidence; (9) insure that evidence, argument, and testimony are introduced and presented expeditiously; (10) refuse to hear arguments that are repetitious, not confined to matters raised in the petition, not related to the evidence or that constitute mere personal criticism; (11) accept and note any petitioner's waiver of any right granted by these rules; and (12) exercise any other powers necessary or convenient to carry out the hearing examiner's responsibilities and to insure timely certification of changes in preliminary findings to the commissioner of education. (b) Official notice. The hearing examiner may take official notice of any matter which trial judges may judicially notice and of facts within the hearing examiner's personal knowledge or specialized experience. Petitioners in a protest in which official notice is taken shall have an opportunity to contest the matter. (c) Transcription of protest hearings. All protests heard by the hearing examiner shall be recorded. A petitioner will be provided a copy of the recording after a written request and payment of a cost-based fee. A petitioner may at any time make arrangements for and bear the cost of having a hearing recorded and transcribed by a court reporter. (d) Motion to dismiss. The hearing examiner may entertain motions for dismissal at anytime for any of the following reasons: (1) failure to prosecute; (2) unnecessary duplication of proceedings or res judicata; (3) withdrawal of protest; (4) moot questions or obsolete petition; (5) failure to accompany the petition with certification of service of notice of intent to protest as required by sec.9.6(d) of this title (relating to How to File a Protest); or (6) the result of an appraisal district protest is adverse to a district. (e) Postponement. The hearing examiner may grant or deny a request to postpone a protest hearing if good cause is shown and doing so would not in any way prevent timely certification of changes in the preliminary findings to the commissioner of education. A request to postpone must be in writing, show good cause for the postponement, and be delivered before the date the protest hearing is scheduled to begin. (f) Evidence. The hearing examiner shall determine the admissibility of the evidence. Any petitioner may object to the admission of evidence and the objection will be ruled on and noted on the record. The hearing examiner may exclude irrelevant, immaterial, or unduly repetitious evidence. The hearing examiner may receive any part of the evidence in writing. (g) Ex parte communications. The hearing examiner in a protest may not communicate outside a protest hearing, directly or indirectly, with any agency, person, petitioner, petitioner's agent, or petitioner's authorized representative regarding any issue of fact or law relating to the protest unless all petitioners in the protest have notice and opportunity to participate, except that the hearing examiner may communicate ex parte with comptroller employees to use the comptroller's special skills to evaluate the evidence if the employee will not participate in the protest hearing, has not been involved in preparing for the hearing and has not been involved in conducting the particular property value study under protest. sec.9.10. Conduct of Hearing. (a) The hearing examiner shall convene a hearing for a protest. (b) All proceedings are closed to the public and are held in Austin, unless the hearing examiner designates another place for the hearing. Any person desiring to observe or participate at any stage of the proceedings who is not a petitioner, not employed by a petitioner, or not called as a witness must obtain the permission of the hearing examiner and the agreement of all petitioners in the protest. (c) The hearing examiner shall conduct a single hearing that provides for: (1) participation by the affected district(s), appraisal district, and any property owner that has filed a valid and timely petition, if the hearing concerns preliminary findings of taxable value or the measures of degree of uniformity and median level of appraisals; or (2) participation by the affected district(s) and the commissioner of education, if the hearing concerns the preliminary findings of an audit of a district's taxable property values. (d) Each petitioner in a protest hearing is limited to one hour for presentation of evidence and argument. For good cause shown and in the interest of a full and fair hearing, the hearing examiner may extend the time limit for a hearing. (e) The petitioner may designate in writing an authorized representative to present evidence and argument. (f) If a comptroller employee has requested in writing information, materials, sales, or documentary evidence of any type from the appraisal district, property owner, or district pursuant to the Tax Code, sec.25.20, during the conduct of the property value study and any of these materials are not provided to the comptroller's employee within 10 days of the request, the materials that were not provided shall be inadmissible during the conduct of a protest hearing for a petitioner who failed to provide the materials. The comptroller may require that information requests be supplemented. (g) Each petitioner may present argument on any matter raised by the petition. Each petitioner may offer oral argument at the hearing. Argument shall be confined to the evidence and to arguments of other parties. (h) Not more than one representative for each petitioner or aligned group of petitioners shall be heard in the protest hearing on any petition except on leave of the hearing examiner. (i) The hearing examiner shall establish the order of proceeding, and is responsible for closing the record. sec.9.11. Proposed Decision. (a) The hearing examiner, hearing examiner's designee, or a comptroller employee who has read the record shall prepare a proposed decision which shall include a statement of the reasons for the proposed decision. (b) The hearing examiner shall serve the proposed decision on the petitioner's agent by certified mail. sec.9.12. Exceptions to Proposed Decision. (a) Unless the petitioner has waived the right of review of the proposed decision, any petitioner adversely affected by the proposal may, within seven days after the date the proposed decision is mailed, file exceptions by delivering the original documents to the hearing examiner. Replies to exceptions shall be filed in the same manner within 14 days after the proposal for decision is mailed. Copies of all exceptions and replies shall be served promptly on the examiner and on all other petitioners in the protest with certification of service furnished to the hearing examiner. Failure to provide copies to all other petitioners in the protest and the hearing examiner with certification of service is grounds for withholding consideration of the written exceptions. (b) After consideration of the exceptions and replies, the hearing examiner may issue an amended decision without again serving the decision on the petitioner's agent. sec.9.13. Final Decision. (a) A proposed decision is final 10 days after it is delivered to the parties to the protest, unless: (1) exceptions to the proposed decision are filed, in which case the decision becomes final seven days after the latest deadline for filing a reply to the exceptions; or (2) the decision is amended, in which case the decision becomes final on the day the amended decision is issued. (b) A final decision ordering changes to preliminary findings made as a result of a school district's protest will change the preliminary findings for the county education district in which the school district participates. (c) A final decision ordering changes to preliminary findings made as a result of a county education district's protest will change the preliminary findings for the county education district's component school districts. (d) A final decision ordering changes to preliminary findings made as a result of an appraisal district's protest will change the preliminary findings for the county education district and the school districts located in the appraisal district. (e) A final decision ordering changes to preliminary findings made as a result of a property owner's protest will change the preliminary findings for the county education district and the school district where the property which is the subject of the protest is located. A property owner's preliminary value will be changed by a protest brought by a county education district, school district, or appraisal district. (f) A decision concerning a protest of preliminary findings of an audit request must be decided by written order within 120 days of the date the school district received the preliminary findings. (g) The hearing examiner shall deliver by certified mail written notice of the final decision to each protesting petitioner's agent. sec.9.14. Certification of Changes to Preliminary Findings. Unless the comptroller determines that circumstances require otherwise, the comptroller shall certify to the commissioner of education all changes to the preliminary findings before July 1 of the year following the year of the study. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas on December 31, 1991. TRD-9116468 Martin Cherry Chief, General Law Section Comptroller of Public Accounts Earliest possible date of adoption: February 7, 1992 For further information, please call: (512) 463-4028 TITLE 40. SOCIAL SERVICES AND ASSISTANCE Part I. Texas Department of Human Services Chapter 48. Community Care for Aged and Disabled In-Home and Family Support Program 40 TAC sec.48.2702 The Texas Department of Human Services (DHS) proposes an amendment to sec.48. 2702, concerning the In-Home and Family Support Program (IHFSP), in its Community Care for Aged and Disabled chapter. The purpose of the amendment is to allow applicants to be placed on the IHFSP waiting list according to the date their application is received by DHS. This will be in keeping with the intent of the original legislation. Burton F. Raiford, interim commissioner, has determined that for the first five- year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Raiford also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be that applicants will receive services on a first-come, first- served basis. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the proposed section. Questions about the content of this proposal may be directed to Linda Lamb at (512) 450-3199 in DHS's Community Care Section. Comments on the proposal may be submitted to Nancy Murphy, Policy and Document Support-368, Texas Department of Human Services E-503, P.O. Box 149030, Austin, Texas 78714-9030, within 30 days of publication in the Texas Register. The amendment is proposed under the Human Resources Code, Title 2, Chapters 22 and 32, which authorizes the department to administer public and medical assistance programs. sec.48.2702. Application. (a) (No change.) (b) Upon receipt of the application, the caseworker places the applicant on the waiting list in order, according to the date the application is received by the Texas Department of Human Services (DHS)
            [in one of the following four categories: [(1) Category I-Age 4 through age 17; [(2) Category II-Age 18 or older and living alone; [(3) Category III-Age 18 or older and living with spouse, relatives, or friends; or [(4) Category IV-Age 65 or older.] (c) When funds become available to serve an applicant, the applicant receives written notification which schedules an appointment to begin the eligibility determination process.
              [If a slot in the appropriate age category is available, the applicant receives an appointment letter/notice of waiting list status scheduling an appointment.] (d)-(h) (No change.) This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on December 30, 1991. TRD-9116432 Nancy Murphy Agency liaison, Policy and Document Support Texas Department of Human Services Proposed date of adoption: March 15, 1992 For further information, please call: (512) 450-3765 Texas Department of Insurance Exempt Filing Notification Pursaunt to the Insurance Code, Chapter 5, Subchapter L (Editor's Note: As required by the Insurance Code, Article 5.96 and 5. 97, the Texas Register publishes notice of proposed actions by the Texas Board of Insurance. Notice of action proposed under Article 5.96 must be published in the Texas Register not later than the 30th day before the board adopts the proposal. Notice of action proposed under Article 5.97 must be published in the Texas Register not later than the 10th day before the Board of Insurance adopts the proposal. The Administrative Procedure and Texas Register Act, Article 6252-13a, Texas Civil Statutes, does not apply to board action under Articles 5. 96 and 5.97. The complete text of the proposal summarized here may be examined in the offices of the Texas Department of Insurance, 333 Guadalupe Street, Austin, Texas 78714- 9104.) The State Board of Insurance, at a board meeting scheduled for 8:30 a.m., February 6, 1992, in Room 100 of the Texas Department of Insurance Building, 333 Guadalupe Street in Austin, will consider adoption of Rule XV of the Rules and Regulations of the Texas Workers' Compensation Insurance Facility. The proposed rule sets forth the rules for the operation of the Market Assistance Program. The proposed rule indicates that prior to assignment through the employers rejected risk fund, the facility will conduct a market assistance program (MAP) market search to determine whether a member company will write the risk in the voluntary market. The proposed rule provides that a risk that has received a quote through the voluntary market is not eligible to utilize the MAP, since the program is designed to assist availability rather than affordability of coverage. The proposal further provides that member companies will be required to complete an initial risk consideration criteria survey and return the completed survey to the Texas Department of Insurance. Failure to complete and return the survey will constitute an administrative violation punishable by an administrative penalty not to exceed $5,000. The proposed rule provides that when member companies willing to consider a risk have been identified, a copy of pertinent data will be forwarded to each identified insurer for review. Each prospective insurer shall advise the MAP whether or not the insurer will accept the risk on a voluntary basis. If the review process extends past the expiration of the current policy, coverage will be bound by the facility in accordance with established rules and regulations of the facility. If a voluntary insurer is found after the facility becomes effective, the facility policy will be canceled pro rata. If a suitable insurer is located, all further negotiations shall be between the agent of the eligible employer and the member company. A member company shall notify the MAP if coverage is either to be provided or rejected. Copies of the full text of the proposed Rule XV of the Rules and Regulations of the Texas Workers' Compensation Insurance Facility are available for review in the office of the Chief Clerk of the Texas Department of Insurance, 333 Guadalupe Street, Austin, Texas 78714-9104. The notification is made pursuant to the Insurance Code, Article 5.96, which exempts it from the requirements of the Administrative Procedures and Texas Register Act. Issued in Austin, Texas, on December 31, 1991. TRD-9116480 Linda K. von Quintus-Dorn Chief Clerk Texas Department of Insurance For further information, please call: (512) 463-6327