Adopted Sections An agency may take final action on a section 30 days after a proposal has been published in the Texas Register. The section becomes effective 20 days after the agency files the correct document with the Texas Register, unless a later date is specified or unless a federal statute or regulation requires implementation of the action on shorter notice. If an agency adopts the section without any changes to the proposed text, only the preamble of the notice and statement of legal authority will be published. If an agency adopts the section with changes to the proposed text, the proposal will be republished with the changes. TITLE 7. BANKING AND SECURITIES Part I. State Finance Commission Chapter 3. Banking Section Subchapter B. General 7 TAC sec.3.35 The Finance Commission of Texas adopts new sec.3.35, concerning imprinting safe deposit box keys with the issuing financial institution's routing number, without changes to the proposed text as published in the June 19, 1992, issue of the Texas Register (17 TexReg 4409). Texas Banking Code, Article 342-906 added the requirement that safe deposit box keys be imprinted with the routing number for the issuing financial institution. This requirement becomes effective September 1, 1992. The legislative purpose behind this requirement was to aid law enforcement officers in identifying the location of safe deposit boxes when circumstances indicate probable use in connection with illegal activities. The regulation is designed to provide specific guidance to financial institutions about how to comply with the imprinting requirement. Financial institutions must imprint all safe deposit box keys at the time of issue for keys issued on or after September 1, 1992. For keys issued before September 1, 1992, financial institutions are directed to imprint each key at the time a customer presents it for access to a box. Specific directions are included about the location on the key for imprinting and the number to be imprinted. No comments were received during the official comment period running from publication of the proposed regulation in the Texas Register on June 19, 1992. On November 26, 1991, the Finance Commission proposed an identical regulation which was reproposed in June 1992, because the regulation was not adopted in final form within 6 months following proposal as required by the Administrative Procedure and Texas Register Act. During December 1991, two comments were received in opposition to the portion of the regulation requiring financial institutions to imprint keys issued before September 1, 1992. These commenters acknowledge the legislative history anticipating that all keys would be imprinted, but indicate that the language of the statute can be read to require imprinting only for keys issued on or after September 1, 1992. Commenters indicate that, in their opinion, this additional burden of time and expense on banks does little to enhance the ability of law enforcement officials to locate criminal contraband over requiring imprinting only for new keys issued after September 1, 1992. Another comment in favor of the regulation as written was received after the official 1992 comment period indicating that even if the statute could be considered ambiguous concerning the imprinting of keys issued before September 1, 1992, the legislative history clearly registers an intent to require that all keys be imprinted. In that commenter's opinion, little additional burden results since the regulation does not contemplate wholesale recall and imprinting of existing keys. Banks must make the investment in imprinting equipment and staff training in any event and will simply imprint existing keys over time as the customers come into the institution on access the boxes. The Independent Banker's Association of Texas on August 13, 1992 commented in favor of the adoption and Anderson, Smith, Null and Stofer on December 4, 1991, Texas Commerce Bancshares, Inc. on December 4, 1992, commented against the adoption. The agency disagrees with the comments in opposition to the regulation because it agrees with the affirmative comment that even if the statute could be considered ambiguous, the legislative history supports the agency's interpretation that all keys are required to be imprinted. The agency is also of the opinion that, consistent with the legislative purpose of the statute, assistance to law enforcement officials is significantly increased by imprinting both future-issued and existing keys and that the regulation is structured so as to impose minimal burden upon financial institutions relating to imprinting existing keys. The new section is adopted under the Texas Banking Code, Article 342-906, which requires financial institutions to imprint safe deposit box keys with their routing numbers. Texas Banking Code, Article 342-103, provides the Finance Commission with rule-making authority over this subject matter. This agency hereby certifies that the rule as adopted has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on August 28, 1992. TRD-9211748 Ann Graham General Counsel Department of Banking Effective date: September 18, 1992 Proposal publication date: June 19, 1992 For further information, please call: (512) 475-1300 TITLE 22. EXAMINING BOARDS Part IX. Texas State Board of Medical Examiners Chapter 163. Licensure 22 TAC sec.163.3 The Texas State Board of Medical Examiners adopts an amendment to sec.163. 3, concerning licensure, without changes to the proposed text as published in the July 7, 1992, issue of the Texas Register (17 TexReg 4870). The amendment to the rules will allow reciprocity licensure based on national board examination. The section will function by allowing physicians to make application for licensure based on national board examination. Several written comments were received and several verbal comments were made during the public hearing which was held on August 20, 1992. All verbal comments and most written comments supported adoption of the amendment concerning acceptance of the national boards as a means for licensure by reciprocity in Texas. One negative comment was received by the Texas Medical Association, (TMA) which questioned the reasoning, timing, and appropriateness for two examinations. According to TMA's written comments, reasons against adoption of the amendment to the rule include: TMA's support for the use of a single examination for initial, as well as reciprocity licensure; TMA's recommendation that licensure by endorsement should be held to the same standards; and TMA's stance that multiple examinations for licensure do not properly assess the competence of applicants for licenses in Texas. Comments for the section-Texas Osteopathic Medical Association and Texas College of Osteopathic Medicine. Comments against the section-TMA. Pursuant to Texas Civil Statutes, Article 6252-13(a), sec.5(c), we have been requested by TMA to issue a concise statement of the principal reasons for and against the adoption of the amendment to the rule. Reasons why the board is for the adoption-The board feels that by allowing licensure based on national board examination, the State of Texas will attract quality physicians who have previously been licensed in other states based on national board examination; and further, that either examination properly assesses the competence of applicants for licensure in Texas. The amendment is adopted under Texas Civil Statutes, Article 4495b, which provide the Texas State Board of Medical Examiners with the authority to make rules, regulations, and bylaws not inconsistent with this Act as may be necessary for the governing of its own proceedings, the performance of its duties, the regulation of the practice of medicine in this state, and the enforcement of this Act. This agency hereby certifies that the rule as adopted has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on August 27, 1992. TRD-9211727 Homer R. Goehrs, M.D. Executive Director Texas State Board of Medical Examiners Effective date: September 17, 1992 Proposal publication date: July 7, 1992 For further information, please call: (512) 834-4502 TITLE 28. INSURANCE Part I. Texas Department of Insurance Chapter 3. Life, Accident, and Health Insurance and Annuities Subchapter FF. Credit Life and Accident and Health Insurance Applications and Policies 28 TAC sec.3.5107 The State Board of Insurance of the Texas Department of Insurance adopts the repeal of sec.3.5107, concerning additional provisions for group certificates, without changes to the proposed text as published in the May 22, 1992, issue of the Texas Register (17 TexReg 3769). This section is repealed because it is no longer needed as it affords no additional consumer protection. This section will be repealed. No comments were received regarding adoption of the repeal. The repeal is adopted under the Insurance Code, Articles 3.53 and 1.04, and Texas Civil Statutes, 6252-13a, sec.4 and sec.5. The Insurance Code, Article 3. 53, sec.12, authorizes the board to promulgate rules to supervise that Act. Article 1.04(b) provides the board with authority to determine rules in accordance with the laws of this state. Texas Civil Statutes, Article 6252-13a, sec.4 and sec.5, authorize and require each state agency to adopt rules of practice setting forth the nature and requirements of available procedures and prescribe the procedures for adoption of rules by a state administrative agency. The repeal affects regulation of credit life, accident, and health insurance under the Insurance Code, Article 3.53, sec.1-14. This agency hereby certifies that the rule as adopted has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on August 31, 1992. TRD-9211814 Linda K. von Quintus-Dorn Chief Clerk Texas Department of Insurance Effective date: September 21, 1992 Proposal publication date: May 22, 1992 For further information, please call: (512) 463-6327 TITLE 43. TRANSPORTATION Part I. Texas Department of Transportation Chapter 17. Division of Motor Vehicle Titles and Registration Registration and Title System 43 TAC sec.sec.17.53-17.55 The Texas Department of Transportation adopts new sec. sec.17.53-17.55, concerning automated vehicle registration and certificate of title system. Section 17.54 is adopted with changes to the proposed text as published in the June 5, 1992, issue of the Texas Register (17 TexReg 4091). Section 17. 53 and sec.17.55 are adopted without changes and will not be republished. The new sections provide for automated equipment compatible with the department's new automated registration and title system (RTS) to be made available to the county tax assessor-collectors as statutorily designated agents of the state for preparing registration and title documents in accordance with the provisions of the Certificate of Title Act, Texas Civil Statutes, Article 6687-1, and the registration laws, Texas Civil Statutes, Article 6675a-1, et seq. The RTS requires data entry into the automated network at the county tax assessor-collectors and, therefore, automated equipment compatible with the RTS is indispensable to the operational integrity of the system. In order to insure uniformity and compatibility of that automated equipment, to effectively support and assist the county tax assessor-collectors in performing vehicle registration and title functions as statutorily designated agents of the state and to maintain the operational integrity of the system, subject to the provisions of new sec.sec.17.53-17.55, it is in the public's interest for the department to make automated equipment that is compatible with the new RTS available to the county tax assessor-collectors. It is necessary to adopt the new sections in order to insure proper administration of the new RTS. The new sections prescribe the policies and procedures, including purpose, definitions, respective responsibilities of the department and a county, conditions of availability, and minimum terms of an agreement under which that automated equipment may be made available to a county tax assessor-collector as the designated agent of the state for processing certificate of title and vehicle registration documents. On June 10 and June 26, 1992, the department conducted public hearings to receive comments concerning the adoption of proposed new sec.sec.17.53-17.55, concerning the RTS. Excluding departmental personnel, there were 77 registered attendants at the hearings; 43 for the RTS rules, none against, and 34 no positions were recorded. Oral comments were received from the chief deputy, Travis County Tax Assessor-Collector's Office; Bastrop County Tax Assessor- Collector; Collin County Tax Assessor-Collector; Brazoria County Tax Assessor- Collector; Universal Auto Title Services; Kaufman County Tax Assessor-Collector, representing the Tax Assessor-Collectors Association; chief legal counsel, Texas Automobile Dealers Association (TADA); and an individual. The department also received written comments from TADA; Travis County Tax Assessor-Collector; president, Texas Tax Assessor-Collectors Association (TACA); Bexar County Tax Assessor-Collector; and a resolution submitted by the TACA supporting the RTS. Section 17.53 concerning automated vehicle registration and certificate of title system provides for the policies and procedures under which the department may make automated equipment available to a county tax assessor-collector. A commenter referenced county growth rate and expressed concern about the additional needs for equipment users and requested that sufficient funding be recognized to accommodate that growth. The department's anticipated expenditures for the various programs governed by the agency are subject to legislative appropriation. However, the department has committed to the RTS; and to the extent permitted by available resources, the department will effectively support and assist the counties to maintain the superior level of registration and title services to the motoring public that will be provided by the RTS network. Section 17.53(a)(2) and sec.17.54(a) provide that the department may make automated equipment available to a county and the commenters requested that "may" be changed to "shall." The department believes that the term "may" is a grant of authority to provide the automated equipment and the use of the term "shall" would be inappropriate since the circumstances, conditions, and needs may vary from county to county. The mandatory term "shall" would not allow sufficient flexibility for either the state or the county. Also, in sec.17.54(a) a commenter requested that the language "when requested by resolution of ..." be changed to read "Upon resolution of ...." Consistent with the reasoning for retaining the use of the term "may" in providing the automated equipment, the department does not concur with that proposed change. However, the department will make every effort to meet the needs of the counties to assure effective operation of the RTS as may be practical and consistent with the department's resources. In sec.17.54(a) as published provided that the department will provide the tax assessor-collector with computer programming and personnel training. In order to clarify the intent of that subsection, the department is changing the word "programming" in paragraph (2) to "programs." The department will provide the tax assessor-collector with computer programs necessary for the tax office personnel to accomplish registration and title functions utilizing RTS. Section 17.54(a)(3) provides for the counties to be furnished official automated forms and automated equipment supplies for the initial start up of the system. A commenter requested that the counties be furnished information concerning the expendables and the time period for which those expendables would be provided by the department in order for the county to make provisions for necessary supplies and other materials after the initial start up of the system. Another commenter requested that the department consider providing supplies to the counties subsequent to the initial start up of the system which should assist the county in budget preparation. Due to the purchasing power of volume buying this would provide a consistent price which would meet specifications and ensure proper operation of the department's automated equipment. Realizing that each county's supply requirements will vary depending on the county's vehicle population and supply usage, the department will identify supplies and related estimated costs for those items that will be required to be expended by the counties which should be minimal for each RTS workstation. Prior to implementation of the RTS, those projections will be made available to the counties. Additionally, in accordance with the Local Government Code, sec.271.081, et seq, a local government (county) may participate in the state's purchasing program through the General Services Commission. There is no need to change the published text to accomplish the purpose of this comment. Section 17.54(b)(1)(A) provides that the county must designate an official or employee of the county as liaison with the department for matters concerning use and operation of the equipment. A commenter suggested that we change the language to specify that the county tax assessor-collector must designate that official or employee. Another commenter suggested that the tax assessor- collector be identified as the liaison. The department believes that the designation of an appropriate liaison must remain within the authority of the governing body of the county since it is that body who officially requests the automated equipment furnished to the county for use by the tax assessor- collector. Therefore, the department has not changed the language in that subparagraph. Section 17.54(b)(1)(D) provides that the county will provide physical security and protection of the equipment and shall indemnify the department for any loss or damages to the equipment while in the custody and control of the county. A commenter expressed concerns with additional security that may be required of a county. In some county tax office substations, there are other offices within the same area where the automated equipment may be located and it could be costly to separate that area from other offices. If the county was indemnified or if the county owned the automated equipment and lost it, the county would pay for it; and that would cover that situation. Another commenter expressed concern about a county's indemnification of the state without a set time because some counties budget annually. The department realizes that each county tax office varies with regard to budget matters, office security features, number of personnel, and office accessibility to the public. The department understands that some counties may encounter a security problem. However, it will be the responsibility of the county to determine if the tax office security is sufficient prior to entering into an agreement with the department in accordance with the provisions of sec.17.55, concerning agreement. The department is not only concerned with the physical security and protection of the automated equipment but also the use of and the security of the system and the registration/title data base. With regard to the county owning the automated equipment provided by the state, the department has no authority to purchase equipment with state funds and relinquish ownership to a county while the equipment is still needed for state purposes. Another commenter noted that the Texas Constitution has been interpreted as prohibiting counties from indemnifying anyone unless there is money encumbered to pay for it or the county authorized the establishment of a new tax to spring into existence. It was further asserted that to encumber sufficient money to pay for the equipment and be able to honor the indemnity, if need be, would create an undue fiscal burden on the county. Moreover, to establish a springing tax could result in violations of the Tax Code if the county had already increased taxes for that year to the maximum allowed by the Tax Code and the Constitution before the tax springs into effect. This is a matter for each county to assess and determine; but in recognition of the availability of state equipment at no cost to the county and the need to protect that state equipment, the security of the system, and the state's investment, the department believes that this is not an unreasonable requirement. A commenter requested that sec.17.54(b)(1) be amended by adding subparagraph (G) requiring that as a condition of availability to receive the department's automated equipment, a county must return negotiable receipts for title applications to a licensed dealer the same day as submitted, or if received after 2 p.m. on a business day, return them to the licensed dealer the following business day before noon. If a delay occurs, a vehicle dealer may experience severe problems with cash flow, particularly on the dealer's floor-plan which could create a hardship. Another commenter who processes title transactions for vehicle dealers, also expressed concern about the turnaround time. The department recognizes the problem some vehicle dealers and title services may encounter with the delay in receiving the negotiable title transaction receipts. While the department understands private business concerns, volumes of transactions, conditions, and workloads vary from county to county and the department is not in a position to set such requirements. Additionally, applicable statutory authorities (Texas Civil Statutes, Articles 6687-1 and 6675a-1, et seq) do not permit the department to adopt the proposed amendment. Therefore, the department cannot intrude into internal management of the tax assessor-collector's office for these purposes or require a county to meet specifications for processing vehicle registration and title documents that are not otherwise provided by law. The rulemaking processes cannot enlarge the department's administrative authority beyond that allowed by existing statutes. Section 17.54(b)(2) provides that the automated equipment shall remain the property of the department and must be used by the county tax assessor-collector for operation of the RTS; provided, however, that while not in RTS usage, the equipment may be utilized for another statutory duty or function of that office. A commenter expressed concern with the impact of the RTS because of current contracts with franchise car dealers and title services that process registration and title documents for the tax assessor-collector as deputy tax collectors; and if the work they perform for the tax office cannot continue, then the county tax assessor-collector may require additional personnel in the tax office. Another commenter requested that paragraph be amended to comport with Texas Civil Statutes, Article 6702-1, sec.4.202(h), which stipulates that a tax assessor-collector may delegate to a full service deputy the authority to utilize data-processing equipment and software provided by the department and the department may not limit the ability of a tax assessor-collector to delegate functions to a full service deputy. The commenter also stated that the rules do not provide for full service deputies to receive the automated equipment. It was suggested that full service deputies working with the county tax assessor- collector could provide their own electrical equipment, etc., which would allow them to continue to process registration and title paperwork. The commenter requested that paragraph (2) be amended to read as follows: "... must be used by the county tax assessor-collector or a full service deputy for operation of the RTS." The department believes that the published language does comport with Article 6702-1, sec.4.202(h) in that the use of the term "tax assessor- collector" implicitly includes any deputy duly appointed by the tax assessor- collector pursuant to law. Therefore, the requested additional language was not added to the published text. Section 17.55 provides that prior to receiving automated equipment pursuant to sec.17.54, concerning automated equipment, a county must enter a written agreement with the department and prescribes the form, terms, and condition for that agreement. A commenter noted that it was impossible to know whether the form of the agreement that is prescribed by the department will be objectionable in any other respect until the form is available for review and further, that the section as published allowed unlimited discretion to add terms or conditions to the contract that are not addressed in the regulations. Section 17.54(b) references to form, terms, and conditions are consistent with other contracting statutes affecting the department. The minimum terms and conditions explicitly set forth in sec.17.54 are the primary requirements; and the ability to incorporate additional terms and conditions in the agreement works to the mutual benefit of both the state and the county due to the varying conditions and fact situations across the state. The new sections are adopted under Texas Civil Statutes, Articles 6666, 6675a- 1, et seq, and 6687-1, which provide the Texas Transportation Commission with the authority to promulgate rules and regulations for the conduct of the work of the Texas Department Transportation, and for the orderly administration of statutory provisions relating to the department's issuance of certificates of title and vehicle registration. sec.17.54. Automated Equipment. (a) Authority. When requested by resolution of the commissioners court of a county, and subject to the terms and conditions specified in subsection (b) of this section, the department may: (1) make automated equipment available to that county to be used by its tax assessor-collector in implementing and operating the RTS; (2) provide the tax assessor-collector with computer programs and personnel training; and (3) furnish official automated forms, and, for the initial start up of the system, automated equipment supplies. (b) Conditions of availability. (1) A county must: (A) designate an official or employee of the county as liaison with the department for matters concerning use and operation of the equipment; (B) meet electrical power supply criteria specified by the department prior to installation of the automated equipment; (C) bear all costs incurred for 24-hour per day electrical power consumption for operation of the equipment; (D) provide for the physical security and protection of the equipment and shall indemnify the department for any loss or damages to the equipment while in the custody and control of the county; (E) provide the department's maintenance personnel access to the equipment during business hours of the involved county office; and (F) notify the department not less than 30 working days prior to relocating or adding automation equipment, or of the closing or remodeling of an office, that may affect automated equipment operations. (2) Automated equipment made available to a county pursuant to this section shall remain the property of the department and must be used by the county tax assessor-collector for operation of the RTS; provided, however, that while not in RTS usage, the equipment may be utilized for another statutory duty or function of that office. This agency hereby certifies that the rule as adopted has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on August 26, 1992. TRD-9211695 Diane L. Northam Legal Administrative Assistant Texas Department of Transportation Effective date: September 16, 1992 Proposal publication date: June 5, 1992 For further information, please call: (512) 463-8630 Texas Department of Insurance Exempt Filing Notification Pursuant 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 notices of actions taken by the State Board of Insurance pursuant to Chapter 5, Subchapter L, of the Code. Board action taken under these articles is not subject to the Administrative Procedure and Texas Register Act. These actions become effective 15 days after the date of publication or on a later specified date. The text of the material being adopted will not be published, but may be examined in the offices of the State Board of Insurance, 333 Guadalupe, Austin. ) The State Board of Insurance, in a meeting held on August 26, 1992, adopted the National Fire Protection Association's NFPA-13, Standards for the Installation of Sprinkler Systems, 1991 Edition, General Storage, NFPA-231, 1990 Edition, Rack Storage of Materials, NFPA-231C, 1991 Edition, and amendments to the Texas Department of Insurance Supplemental Sprinkler Rules. The National Fire Protection Association's NFPA-13, Standards for the Installation of Sprinkler Systems along with other NFPA manuals, are the national recognized manuals setting forth the minimum standards for the installing of sprinkler systems in buildings. The Texas Department of Insurance currently uses the NFPA 1989 Edition of Standards for the Installation of Sprinkler Systems for the recognition of sprinkler systems for a rate credit in the base fire rate. The new 1991 Edition of the Standards for Installation of Sprinkler Systems presents a new manual that has been reformatted and rewritten to simplify the use of the manual, without specific changes to the previous standards. In addition, revisions to the Texas Department of Insurance sprinkler Rules, which supplement the NFPA standards, have been made to reflect a reformatting of the rules to follow the formatting of the NFPA manual and simplification of rules for a more user friendly manual. The requirement for the installation of dual fire pumps in high rise buildings was eliminated as an unnecessary rule without justification for the requirement. In addition, other minor changes were made as set out in the attached outline of changes. These changes are to be effective 15 days after notice of this action is published in the Texas Register. Copies of the full text of the NFPA manual and the Texas Department of Insurance sprinkler rules are available for review in the Office of the Chief Clerk of the Texas Department of Insurance, 333 Guadalupe Street, Austin, Texas 78714-9104 Reference Number P-0792-43-I). The notification is made pursuant to the Insurance Code, Article 5.96, which exempts it from the requirements of the Administrative Procedure and Texas Register Act. This agency hereby certifies that the rule as adopted has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on August 31, 1992. TRD-9211817 Linda K. von Quintus-Dorn Chief Clerk Texas Department of Insurance Effective date: September 19, 1992 Proposal publication date: July 21, 1992 For further information, please call: (512) 463-6327 The State Board of Insurance has adopted on August 26, 1992, a filing by the Texas Department of Insurance (department) of a reinsurance intermediary bond. In accordance with the provisions of the Insurance Code, Article 5.97, a text of the proposed filing has been filed in the Office of the Chief Clerk of the Texas Department of Insurance. The filing has been available for public inspection for 15 days and a public hearing was not requested by any party. The reinsurance intermediary bond is a condition for licensing of a reinsurance intermediary by the department. The principal sum of the bond will be $100,000 for a broker and $250,000 for a manager, payable to the department for the use and benefit of any insurer represented by the reinsurance intermediary. A reinsurance intermediary may file with the department an errors and omissions policy in lieu of the reinsurance intermediary bond. This filing becomes effective on the 15th day after notice of this action is published in the Texas Register . This notice is filed pursuant to the Insurance Code, Article 5.97, which exempts it from the requirements of the Administrative Procedure and Texas Register Act (Reference Number O-0792-47-I). This agency hereby certifies that the rule as adopted has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on August 31, 1992. TRD-9211816 Linda K. von Quintus-Dorn Chief Clerk Texas Department of Insurance Effective date: September 19, 1992 Proposal publication date: July 31, 1992 For further information, please call: (512) 463-6327