ADOPTED RULES 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 16. ECONOMIC REGULATION Part I. Railroad Commission of Texas Chapter 5. Transportation Division Subchapter DD. Vehicle Storage Facilities 16 TAC sec.5.907 The Railroad Commission of Texas adopts an amendment to sec.5.907, concerning responsibilities of a vehicle storage facility licensee with respect to storage requirements, without changes to the proposed text as published in the December 3, 1993, issue of the Texas Register (18 TexReg 8841). The amended section clarifies the responsibilities of a vehicle storage facility operator. The amendment clearly defines storage requirements of a vehicle storage facility operator, which include reasonable efforts to prevent theft of the vehicle or its contents, and distinguishes such efforts from conduct that constitutes preservation of a stored vehicle, as defined in sec.5. 902 of this title (relating to Definitions). Comments received concerning the proposed amendment opposed amending the section. One comment asserted that, because the legislature specifically amended that portion of the Vehicle Storage Facility Act dealing with preservation fees to provide that a vehicle storage facility operator is entitled to charge $10 for preservation of a stored vehicle, it intended the term "preservation" to include much broader conduct than the amended section indicates. Some examples given include disconnecting batteries; physical inspections of vehicles; ensuring the safekeeping of pets, groceries, or other items of personal property; and complying with the notification requirements of the Vehicle Storage Facility Act and implementing regulations. Similarly, other comments stated that legislative changes made during the 73rd Legislature, 1993, were intended to authorize a vehicle storage facility operator to charge a one time $10 impoundment fee for each vehicle stored on its lot. In addition, it was asserted that it would impose a burden on a vehicle storage facility operator to include additional information on a tow ticket, and that the current rule already makes clear what is required of a vehicle storage facility operator in securing a stored vehicle. The following associations filed a comment against the proposed amendment: Houston Emergency Towing Association and Texas Towing and Storage Association. The commission disagrees with the comments encouraging the commission to adopt an interpretation of the term "preservation" that would permit the collection of an automatic $10 fee. The Vehicle Storage Facility Act imposes a number of different responsibilities upon a vehicle storage facility operator, including responsibilities associated with the storage and preservation of a stored vehicle, as well as certain notification requirements. In addition, the Vehicle Storage Facility Act, sec.14, sets forth the fees that may be charged by a vehicle storage facility operator for complying with those requirements, and it explicitly distinguishes between the storage, preservation, and notification requirements in setting those fees. Furthermore, the Vehicle Storage Facility Act, sec.14(d), states that additional fees that are similar to notification, preservation, or administrative fees may not be charged by a vehicle storage facility operator. The distinction drawn by the legislature between the various responsibilities of a vehicle storage facility operator and fees that may charged for carrying out such responsibilities is a significant one, and the commission therefore disagrees with the commenters' attempt to treat the preservation fee as a one-time administrative fee that covers the costs associated with meeting those responsibilities. Finally, the commission's definition of "preservation" does not limit the numerous types of conduct necessary to preserve, protect, or service a vehicle. The commission also disagrees with the third comment, finding that it is necessary to clarify the distinction between conduct which is included in the fee for storage of a vehicle, as specified in sec.5.919(c) of this title (relating to Technical Requirements -Storage Fees/Charges), and what conduct may be included in any fee charged for "preservation," as specified in sec.5. 919(b) of this title (relating to Technical Requirements-Storage Fees/Charges). In an earlier rulemaking proceeding, the Commission amended the definition of the term "preservation" in sec.5.902 of this title (relating to Definitions), emphasizing the distinction between these two types of conduct. The amendment of sec.5.907 of this title (relating to Responsibilities of the Licensee -Storage Requirements), which is the subject of this rulemaking proceeding, will render subsections (a) and (d) of that rule more consistent with the definition of the term "preservation" in sec.5.902 of this title (relating to Definitions). In addition, it is necessary to require vehicle storage facility operators to specify on the written bill for services the conduct for which they charge a preservation fee, in order to provide adequate protection to members of the public who will be required to pay for such services. The amended section will allow members of the public to know what services are being charged as "preservation," and, when such services are performed, to determine whether the charges for such services are proper. The billing requirement will also facilitate enforcement by the commission for any instances in which preservation fees are improperly collected by a vehicle storage facility operator. The amendment is adopted under Texas Civil Statutes, Article 6687-9a, sec.4(b), which require the commission to adopt rules establishing requirements for the licensing of persons to operate vehicle storage facilities to ensure that licensed storage facilities maintain adequate standards for the care of stored vehicles. The following article is affected by this rule: sec.5.907 -Texas Civil Statutes, Article 6687-9a. 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 January 31, 1994. TRD-9435523 Mary Ross McDonald Assistant Director, Legal Division-Gas Utilities/LP Gas Railroad Commission of Texas Effective date: February 22, 1994 Proposal publication date: December 3, 1993 For further information, please call: (512) 463-7095 Part II. Public Utility Commission of Texas Chapter 23. Substantive Rules Telephone 16 TAC sec.23.92 The Public Utility Commission of Texas adopts new sec.23.92, with changes to the proposed text as published in the August 3, 1993, issue of the Texas Register (18 TexReg 4994). All local exchange companies (LECs) that have interstate expanded interconnection tariffs in effect will be required to comply with this rule. The rule requires all such LECs to file tariffs to provide for expanded interconnection and collocation for intrastate special access services and private line services. The rule also requires these LECs to unbundle their special access and private line services so that individual rate elements can be made available to customers. LECs subject to the rule are also required to remove all resale restrictions on these services as a result of the new rule. Finally, the rule requires that these LECs file amended tariffs which conform to the new rule in accordance with a schedule established in the rule. The public benefit anticipated as a result of enforcing the new section will be a growth in competition that should increase LEC incentives for efficiency, encourage LECs to deploy new technologies that facilitate innovative service offerings, and reduce prices for services available from both the LECs and alternative providers. It should also improve LEC responsiveness to customers in the provision of existing services and increase choices available to customers who value redundancy and route diversity. The following submitted comments in response to the August 3, 1993 Texas Register publication: AT&T Communications of the Southwest, Inc. (AT&T); GTE Southwest, Inc. and Contel of Texas, Inc. (the GTE Companies); MCI Telecommunications Corporation (MCI); MFS Communications Company, Inc. (MFS); Sprint Telecommunications Company L.P. (Sprint); Southwestern Bell Telephone Company (SWB); Teleport Communications Group (TCG); Texas Statewide Telephone Cooperative, Inc. (TSTCI); Texas Telephone Association (TTA); United Telephone Company of Texas (United); and U.S. Metroline Services, Inc. (USM). Reply comments were received from AT&T, MCI, MFS, SWB and TCG. Several parties requested by means of a transmittal letter to be notified of the time and date of the Commission sponsored workshop in connection with sec.23.92, but did not file any written comments. These parties were: John Staurulakis, Inc.; the Interexchange Access Coalition (IAC); Clark, Thomas and Winters; and an individual from Austin, Texas. Following the publication of the proposed rule, the Commission conducted a workshop at which the commenting parties further discussed the issues raised in their comments. The Commission staff filed an initial recommendation on November 16, 1993. The following parties filed comments in response to the initial recommendation: AT&T, TCG, TSTCI, the GTE companies, and SWB. These comments do not differ substantially from those originally submitted by the parties. Parties in support of the rule are MFS, Sprint, AT&T, MCI, and TCG. Generally in support of the rule, but opposed to certain provisions are the TTA, United, TSTCI, and the GTE companies. SWB and USM are strongly opposed to the rule. SWB recommends against adoption of the proposed rule. MFS "strongly supports adoption" of the rule as proposed, commenting that the rule is a "good first step towards the goal of full unbundling" as it will allow competitors access to one of the basic LEC network functions: point-to-point non-switched access lines to customer premises. Similarly, Sprint comments that "there is much in the proposed rule to be commended." It says the rule "will initiate effective intrastate access competition in Texas, " resulting in lower prices and better access services for interexchange carriers (IXCs) and other access customers, "thereby benefiting end-users as well as the entire telecommunications industry." TCG supports adoption of the proposed rule. AT&T also supports the proposed rule, commenting that expanded interconnection provides an opportunity to determine whether competition is viable for certain components of access services. According to AT&T, a true test of competition for these components can occur only if the following conditions are met: expanded interconnection is made available for both switched and special access; physical collocation is the standard architecture; basic network functions are unbundled; and all resale and sharing restrictions are eliminated. MCI believes that one of the goals of the proposed rule is to "moderate the LECs' market power." MCI "wholeheartedly supports such a purpose as fully consistent with the stated purpose of regulation, which is to act as a substitute for competition where the forces of competition are incapable of operating absent regulatory action (PURA, sec.2)." The proposed rule represents a "small but necessary step" by the Commission in encouraging the development of a more competitive telecommunications marketplace. The TTA commends the Commission for making what it considers the correct decision to proceed with collocation on a sequential basis. However, the TTA expresses concern that the proposed rule deviates from this intent by addressing not only special access collocation, but also the issues of resale and unbundling. The TTA believes, "[i]n its effort to promote competition in the local market, it appears that the Commission has relegated its public policy goal of promoting universal service." The TTA maintains that the Commission has "replaced its obligation of protecting the public interest with that of protecting new entrants in the local exchange market." TSTCI, United and the GTE companies support the comments of the TTA. The Commission disagrees with the TTA's analysis. The Commission's public policy goals of promoting competition and promoting universal service are not mutually exclusive. Policies, such as expanded interconnection, that seek to promote competition and a more open network environment may also have a positive impact on universal service by giving incentives to LECs to be more responsive to customers. Furthermore, there is no evidence that adoption of this rule will in any way harm universal service, as LECs will be allowed to recover the costs associated with the provision of expanded interconnection. The Commission rejects the contention that the rule will have a negative impact on universal service. Subsections (b) and (c) of the proposed rule require LECs to offer expanded interconnection for special access and private line services "at the same locations, in the same manner, and, except for price, under the same terms and conditions" as the LEC offers expanded interconnection for interstate special access services, unless ordered otherwise by the Commission. Most parties expressed support for the rule's general approach of "mirroring" the terms and conditions established at the interstate level. TCG supports the Commission's decision to follow the expanded interconnection rules adopted by the Federal Communications Commission (FCC): "Uniform... policies are efficient and prevent interconnectors from having to negotiate two collocation arrangements in the same central office." Sprint generally supports the proposed rule's application of the FCC's policies as a basis for the forms, terms, and conditions for intrastate expanded interconnection, noting that "[i]t would be inefficient to require an interconnector to purchase interconnection for interstate and intrastate services in a materially different form, for example, physical vs. virtual collocation arrangement, or under materially different terms and conditions." While several LECs express support for this approach, they generally urge the Commission not to go beyond what the FCC required in its expanded interconnection order, and to exercise its own discretion with respect to the FCC's physical collocation mandate. The GTE companies express support for the staff's "underlying premise that the terms and conditions of interstate interconnection should mirror those established at the interstate level." However, the GTE companies urge the Commission to "exercise its own discretion and create its own policy regarding whether the FCC's physical mandate should be required for intrastate services as well." SWB states that from a "purely administrative perspective," mirroring the interstate expanded interconnection tariffs for special access at the intrastate level is a "reasonable approach." However, according to SWB, the Commission should "make its own decisions" on important issues. Furthermore, SWB contends, the proposed rule goes beyond what the FCC ordered. Similarly, the TTA supports the concept of mirroring the FCC's interstate expanded interconnection tariffs and applying the proposed rule to only the Tier 1 companies, but feels that the proposed rule unnecessarily goes beyond the FCC's requirements by including private line services, and "virtual private line" services, eliminating the resale prohibitions in the private line tariffs, and unbundling the rate elements. The Commission disagrees with the above commenters that it should not go beyond the scope of the FCC's decision. While the proposed rule mirrors the FCC expanded interconnection policies in some respects, the Commission does not believe it is necessary to limit the entire scope of this rulemaking to that of the FCC proceedings. Certain issues, such as the inclusion of expanded interconnection for private line services, exist only at the intrastate level. Therefore, if the Commission waited for the FCC to address these issues, they would never be addressed at the state level. The Commission also disagrees with the LECs' suggestion that the Commission is not forging its own policy with respect to the physical vs. virtual collocation requirement. As will be discussed subsequently, the Commission specifically solicited comment on this issue, and did not defer its consideration of this issue to the FCC. On all of the issues, the Commission weighted the comments as well as the FCC's action and chose to implement those portions of the FCC's decision that are appropriate for Texas. The Commission also deviated from, or expanded upon, the FCC's decision where it was appropriate. SWB and the GTE companies raise legal concerns about the proposed rule. In its comments, SWB asserts that the proposed rule is unconstitutional, because collocation is a "taking of LEC property at its most basic level." SWB asserts that, in its effort to increase competition between CAPs and LECs, the FCC has established an "unconstitutional set of rules for collocation." According to SWB, since proposed sec.23.92 "supposedly attempts to mirror the federal regime, it suffers from the same legal deficiencies." SWB asserts that "there can be no doubt that mandatory physical collocation results in a per se taking of LEC private property" under the Fifth Amendment of the U.S. Constitution (and the Fourteenth Amendment, which makes the due process protections of the Fifth Amendment applicable to actions of the State) and Article 1, sec.19 of the Texas Constitution, because "it is a physical occupation of the LECs' property without their voluntary consent." SWB maintains that neither the FCC nor the Commission has the statutory or constitutional authority to mandate such a result. SWB states that the Commission cannot rely upon the "theoretical public interest benefits of competition" to justify collocation. Furthermore, "there is no doubt as to the 'permanent' nature of the occupation and taking." SWB argues that constitutional protection against unlawful takings of property applies to the interests of public utilities as well as individuals. The proposed rule cannot stand on the premise that LECs will receive just compensation through their tariffs because, according to SWB, like the FCC, the Commission "lacks the power to determine just compensation as the question of compensation in 'taking' cases is for the judiciary." The GTE companies also contend that a physical collocation mandate "raises substantial legal issues" under the Fifth Amendment to the U.S. Constitution and Article 1 of the Texas Constitution. The GTE companies assert that if physical collocation is required, collocators will "affix their equipment and equipment racks within the LEC's central office without the consent of the LEC. Further, these collocators will maintain dominion and control over the portion of the LEC's central office dedicated to their exclusive use, and secure easements for ingress and egress through other portions of the central office." According to the GTE companies, "[s]uch facts clearly establish that a "taking" has occurred as a matter of law." The GTE companies maintain that a physical collocation mandate, imposed on the LECs without their consent, "constitutes a physical invasion of the LECs' private property." The GTE companies conclude that "[u]nder either the U.S. and Texas constitutions, such an intrusion upon the property rights of another constitutes a taking." Further, the GTE companies note that the FCC physical collocation requirement is currently being challenged in court. [Bell Atlantic Corp. v. FCC, Numbers 92-1619 and 1620 (D.C. Cir., filed November 25, 1992)]. If the FCC order is overturned on this assert, the Texas rule will be subject to the same challenge. The Commission disagrees with the analysis presented by SWB and GTE. The section does not result in the taking of private property for public use without compensation. SWB and GTE are "public utilities" and "dominant carriers" as those terms are defined in Texas Civil Statutes, Article 1446c (the Public Utility Regulatory Act or "PURA"). Pursuant to PURA, sec.16(a), the Commission is given broad power "to regulate and supervise the business of every public utility within its jurisdiction and to do all things, whether specifically designated in this Act or implied herein, necessary and convenient to the exercise of this power and jurisdiction." Under PURA, sec.18(b), the Commission is given "exclusive original jurisdiction over the business and property of all telecommunications utilities in this state" for the purpose of assuring that adequate and efficient services are available to all citizens of the state at just and reasonable rates. In determining rates, the Commission is directed, by PURA, sec.41(a), to utilize "the original cost of property used by and useful to the utility in providing service." PURA, sec.41(a) further provides that the original cost "shall be the actual money cost...of the property at the time it shall have been dedicated to public use". Thus, under PURA, any property that is used and useful in providing service and that has been included in setting SWB's or GTE's rates has already been dedicated to a public use by the utility. By regulating the manner in which that property is used, the Commission is not "taking" the property, but is carrying out its statutory duty to assure that adequate and efficient services are available to all citizens of the state. None of the cases cited by the LECs involve facts which are comparable to the fact situation addressed by the proposed section. The cited cases involve instances in which the property of a regulated utility was being "taken" by a requirement that the property be used for a purpose other than the public use to which it had been dedicated (e.g. property of a railroad was "taken" for use by a telegraph company, property of an electric utility was "taken" by a rule allowing cable television companies to use its power poles, etc.) Unlike those cases, the proposed section addresses a LEC's use of its property for the same public use (telecommunication service) to which it has previously been dedicated by the LEC. Such regulatory supervision is clearly authorized by PURA. PURA, sec.18(a) contains a legislative statement of public policy recognizing that the telecommunications industry has become "a competitive industry which does not lend itself to traditional public utility rules, policies, and principles; and that therefore, the public interest requires that new rules, policies, and principles be formulated and applied to protect the public interest and to provide equal opportunity to all telecommunications utilities in a competitive marketplace." Section 18(a) also grants the Commission the authority and power to carry out this public policy. Pursuant to PURA, sec.37, the Commission is "vested with all authority and power of the State of Texas to insure compliance with the obligations of public utilities in this Act." Section 47 of PURA prohibits public utilities from discriminating "against any person or corporation that sells or leases equipment or performs services in competition with the public utility" and from engaging "in any other practice that tends to restrict or impair such competition." The Commission finds that the proposed section is clearly within the Commission's authority to adopt as either a means to prevent discriminatory and anticompetitive activity by the LECs under sec.47 and sec.37, or as a means of equalizing competitive opportunity for all telecommunications utilities under Section 18. Regulation of the business and property of LECs in order to accomplish these legislative goals does not constitute the unconstitutional "taking" of utility property. Even if the proposed section is viewed as constituting a "taking" of private property, no constitutional violation has occurred because the section allows for just compensation to be paid to the LECs in the form of just and reasonable rates for the new interconnection service. Contrary to SWB's assertions, it is clear that under PURA, sec.sec.37-48 the Commission has the authority to establish just and reasonable rates for public utility services and that the rates include a reasonable return on public utility property that has been dedicated to a public use. Although the Commission may not have the power to determine just compensation in instances involving the taking of utility property for other purposes, it does have the power to determine the just compensation that a public utility can obtain from the public for the public use (utility service) to which the property has been dedicated. Under the new section, a LEC has the option of charging rates at parity with its interstate rates for the same service or establishing new rates pursuant to sec.23.26(c)(6) of this title (relating to New and Experimental Services), which requires that any such rate exceed the long-run incremental cost of the service and provide a contribution to joint and common costs. While the U.S. Supreme Court has long recognized that utility rates that are too low result in the confiscation of utility property in violation of the constitution, it has refused to specify the methodology that must be employed by the regulatory body in setting rates. The Court has consistently held, since 1944, that it is the end result, not the methodology, that is reviewed to determine if rates are confiscatory. [Federal Power Commission v. Hope Natural Gas Company, 320 U.S. 591,64 S. Ct. 281, 88 L. Ed. 333 (1944).] The Court has recently reiterated that, "The Constitution within broad limits leaves the States free to decide what ratesetting methodology best meets their needs in balancing the interests of the utility and the public." [Duquesne Light Company v. Barasch, 109 S. Ct. 609,620 (1989)]. Since the new section merely establishes the ratesetting methodology to be utilized by the Commission, not the end result, it does not result in a taking of utility property without compensation. It is only if the rates ultimately established by the Commission are found to be non-compensatory that a constitutional violation would occur. In that case the Commission's Final Order setting rates would be subject to reversal, not the rule establishing the methodology. GTE and SWB disagree about whether or not the Commission can require virtual collocation. If the Commission adopts a rule allowing the LEC to negotiate either virtual or physical collocation, such a rule will withstand constitutional scrutiny, according to the GTE companies. However, SWB maintains that even if virtual collocation does not constitute a per se taking, "it does constitute an unlawful regulatory taking" under the three part legal test established in Penn Central Transportation Co. v. New York City , 438 U.S. 104, 123-124 (1978) (hereafter Penn Central), which considers the character of the government action; the regulation's interference with investment-backed expectations; and its economic impact. According to SWB, virtual collocation is a taking under these three factors. First, under the proposed rule, LECs will be required to set aside and refrain from using central office space for their own purposes, and will be required to "accede to the demands of the type and amount" of equipment to be placed in their central offices, which render the character of the government action to be a taking. Second, virtual collocation "deprives LECs of an owner's reasonable investment-backed expectation concerning its property." SWB asserts that it "is a reasonable investment-backed expectation that LECs should not be subject to use restrictions on their property." Finally, SWB asserts that the economic impact of collocation on the LECs will be "quite significant." SWB also notes that the proposed rule suffers "fatal defects" under Texas constitutional laws, specifically Article 1, sec.19 of the Texas Constitution, which provides for "procedural and substantive due process that are virtually congruent with the Federal Constitution." The Commission disagrees with SWB's application of the three-part test established by Penn Central. First, as noted above, the character of the government action is not a "taking" as SWB alleges, but is a legitimate regulation of telecommunications service by the agency that has been authorized to regulate such services. The government action is intended to prevent discrimination by the LECs against competitors as prohibited by PURA, sec.47. The new section is also necessary to establish new policies "to protect the public interest and to provide equal opportunity to all telecommunications utilities" in response to changing federal administrative actions (the FCC decision in CC Docket Number 91-141) as authorized by PURA, sec.18. Second, the owner's reasonable investment-backed expectation concerning its property must be viewed in the context that LECs have been, and continue to be, regulated in their provision of telecommunications services. Any investment in property is made with the knowledge that the Commission has "jurisdiction over the business and property of all telecommunications utilities in the state" pursuant to PURA, sec.18. Any investment is made with the knowledge that under PURA, sec.39 and applicable court decisions, the most that can be expected of such investments is "a reasonable opportunity to earn a reasonable return on its invested capital used and useful in rendering service to the public over and above its reasonable and necessary operating expenses." Any investment is made with the knowledge that, due to its status as a public utility, a LEC is subject to a duty to provide "continuous and adequate service" within its certificated area under PURA, sec.58. Given these statutory provisions, SWB's argument that the LECs have a reasonable investment-backed expectation to be free of such regulation is specious. Third, the economic impact of the new section is insignificant. The new section clearly provides a return to the LECs by allowing them to set the price for this new service at a level equal to their interstate rate for such service or in the same manner that is currently provided for other new LEC services pursuant to sec.23.26. The LECs, particularly SWB, have frequently utilized sec.23.26 to obtain approval for their new services. To now contend that the rates set pursuant to sec.23.26 constitute a "taking" is contradictory. Further, the procedure established by sec.23.26, and incorporated by the new section, meets all of the substantive and procedural due process requirements of all statutory and constitutional provisions. After properly weighing the three factors identified in Penn Central, it is clear that the proposed new section does not result in a regulatory "taking" in violation of the U.S. Constitution and the Constitution of the State of Texas. The Commission has carefully reviewed the comments of SWB and the GTE companies regarding the constitutionality of the proposed section and specifically rejects them. The Commission also notes that SWB made similar constitutional arguments against the FCC's adoption of expanded interconnection at the interstate level, but the FCC concluded that its interconnection policy did not violate constitutional provisions. The Commission has reviewed the FCC's decision on this issue and agrees with the FCC's conclusion. To the extent it does not conflict with any provisions of PURA, the Commission also adopts the FCC's analysis to support its conclusion that the proposed new section does not violate any constitutional provisions. In its Reply Comments, SWB continues to urge against adoption of the rule. SWB criticizes the proponents of the rule for failing to address the proposed rule's "constitutional problems" in their initial comments. In reply comments, several commenters reject the LECs' constitutional and legal arguments, for similar reasons as does the Commission. TCG, in its Reply Comments, argues that the physical collocation requirement is not an "unlawful taking." AT&T comments, on reply, that there is no need for this Commission to engage in a "wholly duplicative analysis of federal constitutional issues." In its Reply Comments, MFS asserts that the LECs' arguments regarding the constitutionality and legality of the proposed rule are "unpersuasive and largely irrelevant, and should not deter the Commission from adopting its proposal." SWB further asserts that the proposed rule is beyond the Commission's powers: PURA "does not expressly confer or imply that the Commission has the authority to take LECs' property. Nor can the Commission avoid an unlawful taking by adopting a general position that the proposed rule only requires LECs to 'mirror' their federal tariffs." SWB also contends that the proposed rule is confiscatory, because LEC "revenue neutrality is not assured under the rules, and LECs will lose revenues as a result of collocation." Furthermore, SWB believes that before "having such revenues confiscated", LECs are entitled to a hearing with due process safeguards, including the right to offer evidence and cross-examine witnesses, which are not provided in a rulemaking. The Commission disagrees with SWB's assertions. There is no provision of PURA which requires that the Commission's regulatory or rulemaking decisions must be "revenue neutral". PURA, sec.39, which is applicable to Commission ratemaking decisions, requires that the Commission fix the utility's revenues at a level which permits the utility "a reasonable opportunity" to earn a return. A particular level of revenue or return is not guaranteed by such action and there is no requirement that the Commission insure that the utility's revenues remain at that level in perpetuity. The courts have recognized that elements such as operating expenses and the appropriate rate of return are factors that can change over time, and have refused to apply res judicata and collateral estoppel principles to all aspects of the Commission's determination of the level of revenues included in a Commission Final Order. [Coalition of Cities v. Public Utility Commission, 798 S. W.2d 560 (Tex. 1990)]. The utility thus has no vested right to the level of revenue assumed in the Commission's rate setting calculations. Although SWB alleges that the adoption of the new section will have an adverse affect on its revenues, it did not submit any calculations to support its assertions. If the new section does, in fact, adversely affect LEC revenues, the proper course of action for the LEC is to submit an application to change its rates pursuant to PURA, sec.43. If the LEC meets its burden of proof under PURA, sec.40, its rates could then be changed to reflect the new level of required revenue. It is this ratemaking procedure that is the appropriate mechanism to address the LECs' concerns about their revenues. This procedure also ensures due process protections are provided to all affected parties before the LECs' revenues are changed. Since the new section does not directly affect LEC revenues, the Commission concludes the use of rulemaking procedures is appropriate and there is no need to utilize the additional due process procedures required of a contested case prior to the adoption of the section. MFS, in its Reply Comments also rejects SWB's claim that the rule is confiscatory, stating that SWB's "insistence on 'revenue neutrality' is both pointless and self-defeating in a competitive marketplace, such as that envisioned by Section 18 of PURA." Finally, according to SWB, the proposed rule "constitutes ratemaking by rulemaking, in violation of PURA and the Administrative Procedure and Texas Register Act ('APTRA')" because the rule "proposes to dictate the rate structure" through the unbundling requirement, and other "rate-affecting terms", such as the elimination of resale restrictions. SWB asserts that the issues involved in the proposed rule are rate structure issues, and are therefore governed by PURA, sec.38, which, according to SWB, "requires the Commission to make certain findings of fact." Failure to make such findings, is according to SWB, "contrary to applicable law." The Commission disagrees with SWB's analysis. First, this matter is not a "contested case" under the Administrative Procedure Act, Texas Government Code sec.2002.001 (the APA). The term "contested case" is defined in the APA as "a proceeding, including ratemaking and licensing, in which the legal rights, duties, or privileges of a party are to be determined by an agency after an opportunity for adjudicative hearing." Although "ratemaking" is referenced, it is not defined. The term "rule" is defined by the APA as "any agency statement of general applicability that implements, interprets, or prescribes law or policy...". The courts have held that the determination of whether to establish agency policy by notice and comment rulemaking or by ad hoc adjudication is a matter that is generally reserved to the informed discretion of the agency. State Board of Insurance v. Deffebach, 631 S.W.2d 794 (Tex. App-Austin 1982, writ ref'd n.r.e.). Because the proposed section is designed to establish policy of general applicability rather than establish the rights of individual parties, the Commission believes that it is more appropriate to use the rulemaking procedures in this instance. Second, the new section by its very terms does not purport to set rates for any entity. The new section establishes general policies related to the provision of utility services by the LECs and directs them to submit tariff amendments to conform to these new requirements within a specific time. Any change in rates would occur as a result of these subsequent tariff filings, which would be conducted as contested cases under the APA. These compliance tariff filings are necessary because the rates are not and cannot be changed (or eliminated) by rule. The contested case will be for the purpose of determining whether the requested tariff change properly implements the Commission's policy as stated in this rule, and not for considering anew what the Commission's policy is or should be. Third, SWB's analysis is flawed because adoption of this new section does not involve the application of PURA, sec.38. Although sec.38 may specify issues that the Commission should consider in establishing a utility's rate structure in a ratemaking proceeding, it does not inhibit the Commission's ability to establish policy pursuant to PURA, sec.16 and 18 and the rulemaking provisions of the APA. Section 38 does not require the Commission to make specific findings before exercising its rulemaking authority under PURA, sec.16 and sec.18, nor does it constitute a legislative directive that rate structure issues may only be addressed in an adjudicative hearing. The fact that this rule of general applicability may subsequently affect the rate structure of all affected utilities does not serve to transform this rulemaking proceeding into a contested case. In its Reply comments, MFS also rejects SWB's arguments regarding ratemaking by rulemaking: "If SWBT's position were accepted, the Commission could not adopt any substantive policies at all by way of rulemaking." MFS argues that SWB appears to be "insisting on unnecessary procedural flourishes" in order to delay the implementation of expanded interconnection. In its response to Staff's initial recommendation, SWB asserts that the fundamental legal problems in the rule remain: that the rule is an unlawful "taking" of LEC property, and a "classic case of 'ratemaking in a rulemaking. '" SWB believes that the rule remains unconstitutional and mandates requirements far beyond what is necessary to implement intrastate expanded interconnection. In its Reply comments, SWB states that it believes that absent clarification of the phrase "same terms and conditions" the proposed rule is "unconstitutionally vague." For the reasons presented previously, the Commission rejects SWB's arguments regarding the legality of the rule. Further, the Commission believes that SWB's concerns regarding the phrase "same terms and conditions" are adequately clarified below. USM asserts that the proposed rule is inadequate and in violation of PURA. Although USM comments that the proposed rule is "highly commendable in many important and needed respects" and that both expanded interconnection and unbundling are "critical to the future of competition in Texas, and its benefits to the public," USM criticizes the proposed rule for not extending "these competitive benefits to USM and other non-dominant providers of lower cost communication services." USM believes this is discriminatory and therefore in violation of PURA. Section 47 of PURA prohibits a public utility from discriminating "against any corporation that sells or leases equipment or performs services in competition with the public utility..." In addition, sec.18 of PURA requires a level playing field for dominant and non-dominant providers alike. Further, USM states that the Commission has very recently recognized that "inflexible, arbitrary classification of competitors is not compatible with the manifest intent of PURA." However, according to USM, the proposed rule is discriminatory because it applies only to competitors and end users who only need to subscribe to the LECs' special access or private line services or who own their own special access or private line "backbone" facilities: "For the proposed rule to provide interconnection benefits only to that exclusive, and small, group of fiber carriers..., IXCs and large users is discriminatory." USM asserts that non-dominant providers, "who do not have their own transmission facilities..., 'backbone' equipped IXCs and carriers' carriers are just as entitled to the protection and benefits provided by the Commission as are fiber companies in Texas." Furthermore, USM recommends that the rule extend far beyond expanded interconnection for special access and private line: "Non-dominant companies not owning their own transmission networks should be able to obtain expanded interconnection, have resale restrictions removed, and receive unbundling of the LEC services these companies need, e.g. PBX trunks, Centrex, blocks of telephone numbers, DID and other network access services; not just special access and private line services." All customers, USM contends, have equal rights to the network on the same non-discriminatory terms. Further, both State and Federal law "require adherence to that principle in this proceeding; a rule for MFS also should be a rule for USM and, ultimately, for all consumers of all services of all providers." USM urges the Commission to amend the rule to provide for collocation, unbundling and the removal of resale restrictions for all LEC services. USM's comments seek to expand the scope of this rulemaking to apply the unbundling requirement and the prohibition of a resale restriction to local exchange service as well as special access and private line service. The Commission finds that USM's request is beyond the scope of notice given in this rulemaking project. Because the requested changes address new subject matters and potentially affect new parties, the Commission would be required to republish notice in the Texas Register before adopting the proposed changes. Rather than take that action, the Commission feels that it is a better use of agency resources to adopt this section and to reserve the issues raised by USM for a separate rulemaking proceeding. Several parties comment that the rule does not go far enough and should be extended to include interconnection for switched transport. AT&T urges the Commission to modify the proposed rule to include at least switched transport interconnection, in light of the FCC's August 3, 1993 decision ordering Tier 1 LECs to offer expanded interconnection for switched transport [Expanded Interconnection with Local Telephone Company Facilities, Second Report and Order and Third Notice of Proposed Rulemaking, 8 FCC Rcd 7374 (1993) (hereafter Second Order).] AT&T asserts that revising the proposed rule to include switched transport interconnection should not require re-publication, because it affects no other subjects or persons than the rules previously noticed. MCI and Sprint also urge the Commission to move swiftly forward with rules providing for intrastate expanded interconnection for switched access services. MFS strongly urges the Commission to proceed with further rulemakings to address competitive access to switching, signalling, and other LEC network functions as soon as possible. Similarly, TCG recommends that the Commission authorize interconnection for the provision of the local transport portion of switched access services, which, like special access services, are dedicated point-to-point high volume facilities, provided between an IXC point of presence and a LEC central office. TCG contends that "IXCs need the quality, reliability and diversity of competitive alternatives" for these facilities. Furthermore, according to TCG, competition for the local transport portion of switched access "dramatically increases the prospects for effective competition in traditional private line services..." TCG asserts that without the ability to combine special and switched traffic on one facility, interconnectors will not be able to develop the same economies of scale and scope that LECs enjoy and thus will not be able to effectively compete with the LECs. The Commission finds that the commenters' request that expanded interconnection for switched transport be included in this rule is beyond the scope of notice given in this rulemaking project. The Commission disagrees with AT&T that re- publication would not be required. Because the requested changes address new subject matters (switched access services) and potentially affect new parties, the Commission believes it would be required to republish notice in the Texas Register before adopting the proposed changes. The issues raised by the commenters regarding switched transport interconnection will therefore be reserved for a separate rulemaking proceeding. In its Reply Comments, SWB also states that expanding the scope of the rulemaking to include switched transport interconnection, as well as collocation, unbundling, and removal of resale restrictions for all LEC services, as recommended by USM, is beyond the scope of this rulemaking: "To combine any or all of these issues into a single rulemaking at this point would be unlawful, extremely unfair, and would constitute a significant deviation from the Commission's previous pronouncements on the schedule of these significant regulatory events." Sprint comments that the rule should also require LECs to originate and terminate switched traffic at interconnector collocation sites established under the special access interconnection offerings. Under this arrangement interconnectors would still be required to purchase local transport service from the LEC until interconnection is given for that service. According to Sprint, "[t]his would allow the shared and efficient use of collocation facilities." Otherwise, CAPs and CAP customers "will be forced to inefficiently reconfigure networks to serve their special access needs separately from their switched access needs." Furthermore, Sprint comments, permitting dual use of collocation sites will have minimal impact on LEC revenue flows because LECs would continue to bill for local transport to the collocation site. The Commission believes that Sprint's recommendation also goes beyond the scope of this proceeding, and is best reserved for a separate rulemaking proceeding. By its express terms sec.23.92 applies to each local exchange carrier that has interstate expanded interconnection tariffs in effect. Currently, these are the Tier 1 LECs. TTA notes that although the proposed rule does not currently affect non Tier 1 companies, if at some future date smaller companies are required to offer collocation, TTA recommends that they be permitted to do so on an individual case basis. The Commission understands the TTA's concern. Since interstate expanded interconnection currently applies only to Tier 1 LECs, the proposed rule also only applies to Tier 1 LECs at this time. Should the FCC, at some future date, expand the application of its expanded interconnection policy to non Tier 1 LECs, sec.23.92 will apply to those LECs as well. However, since non Tier 1 LECs are not currently subject to this rule, and in the absence of an overriding reason for specifically exempting non Tier 1 LECs from the provisions of the proposed rule, the Commission believes the concern raised by the TTA is best addressed when, and if, the FCC expands its expanded interconnection policy to apply to non Tier 1 LECs. In the preamble to the proposed rule, the Commission specifically posed two questions for comment. The first question asked the parties to comment on whether or not the proposal should be modified to allow LECs to offer virtual, rather than physical, collocation with respect to intrastate special access and private line services. As published, the rule requires LECs to offer expanded interconnection on the same terms and conditions as it is offered at the interstate level. Since the FCC has established a physical collocation standard, with certain conditions under which virtual collocation is permitted, this standard would be followed at the state level. In general, most of the non-LEC commenters supported leaving the published language intact, while the LECs preferred to be given the option to offer virtual collocation, at the LECs discretion. MFS commented that the proposed rule "takes the correct approach" therefore, no modification of the rule is necessary. As proposed, the rule "will permit the LEC to offer virtual collocation for intrastate services under the same conditions as it may for interstate services; that is,...at any central office where the FCC has granted an exemption from physical collocation due to space limitations or other valid cause and...at any central office where the LEC and a prospective interconnector have agreed on the terms of virtual collocation." In contrast, allowing the LECs to offer virtual collocation as the sole option to interconnectors leaves a potential for abuse, allowing the LECs to offer potentially inferior arrangements. MFS asserts that, "physical collocation is the only standard that provides a readily verifiable and enforceable means of assuring that competitors receive access to LEC network functionalities that is technically, economically, and administratively comparable to the LEC's own access." MCI also recommends that the Commission not modify its proposal to allow the LEC to offer virtual, rather than physical collocation. MCI cites the Oregon Commission's Open Network Architecture order, in which the Oregon Commission found that virtual collocation may "often be inferior from the customers perspective" [ Re: Open Network Architecture , (OR) 145 PUR 4th 450, AR 264, Order Number 93-852, June 18, 1993, at 456]. The FCC also concluded that physical interconnection is the preferred standard. Further, because the FCC's rules permit virtual collocation under certain conditions, the language of subsections (b) and (c), which provides that expanded interconnection will be offered "in the same manner [and] under the same terms and conditions" as interstate services are offered is sufficient, according to MCI. TCG emphasizes the need for interconnectors to have the option of using either a physical or virtual collocation arrangement, depending on their particular needs: "The only way an interconnector can negotiate a satisfactory virtual collocation arrangement is if the LEC knows that the interconnector is free to utilize a physical collocation arrangement." According to TCG, "the only distinction between 'physical' collocation and a workable 'virtual' collocation is ownership" of the interconnection electronics. TCG believes that the availability of physical interconnection serves as a "marketplace check" on the reasonableness of the LEC's virtual collocation proposals. Without such a check, the interconnector is "left without the ability to control an essential part of its service and costs." TCG believes that any concerns the LECs may have about the availability of floor space can be allayed by following the FCC's lead and requiring space for physical collocation be provided on a first-come first- served basis. If and when space in the central office is exhausted, the Commission should require LECs to offer virtual collocation. AT&T also comments that the rule should not be modified to allow LECs to offer only virtual collocation, although nothing should prohibit mutually satisfactory virtual collocation arrangements. AT&T asserts that physical collocation is the appropriate standard because, "it ensures the opportunity for connections to the LEC network that are of at least the same quality and standards as the LEC provides for its own services." While parties should be able to negotiate virtual collocation arrangements, "the negotiation process will be meaningful only if physical collocation is the standard." In its Reply Comments MCI agrees with AT&T that "if the LEC is afforded the option of unilaterally determining the type of interconnection...there can be little hope for effective, bilateral negotiations." Furthermore, AT&T comments, the FCC has mandated physical collocation, and since intrastate and interstate services are generally provided over the same physical facilities, "substantial inefficiencies and unnecessary costs would be imposed if intrastate interconnection arrangements were different from the architecture used for interstate services." Sprint does not believe the requirement of physical collocation is necessary, as long as a virtual arrangement is provided with the same level of service and at the same price as a physical arrangement. However, Sprint comments, since the FCC mandates physical collocation, with exceptions for lack of central office space, negotiated virtual arrangements, or in cases where a state has established a virtual collocation requirement, the physical collocation requirement "would have to apply to any arrangement providing both interstate and intrastate interconnection not covered by an exception." The TTA recommends that LECs be given the option to negotiate with each interconnector whether they offer physical or virtual collocation. United also believes that the "LEC should have the final decision whether the form of interconnection should be physical or virtual in nature." The Commission should not mandate physical collocation, "at least until the issue is finally resolved at the federal level." The GTE companies strongly recommend that the proposed rule be modified to give LECs the option of negotiating a virtual collocation arrangement, "instead of being required to provide physical collocation in all instances." The GTE companies contend that a physical collocation requirement is not essential for the provision of expanded interconnection, and furthermore such a requirement has adverse affects. The GTE companies express concern that a physical collocation mandate hinders the LEC in negotiating fair and equitable arrangements, and will hinder the LECs' ability to effectively and efficiently manage its own facilities. Furthermore, the GTE companies assert, "mandatory physical collocation will likely lead to service arrangements which are relatively inefficient." The GTE companies contend that it is not fair to compel LECs to accommodate architectural and rate design imperatives which impose inefficiencies in network design, provisioning and administration. SWB requests that it have the option to offer either physical or virtual collocation on a site-by-site basis. SWB contends that this option would allow the LEC to have "the flexibility to manage its property and operations." At the federal level, SWB does not have the option to offer virtual rather than physical collocation. Rather, at the federal level, virtual has been determined to be an adequate back-up form of collocation, to be offered when there is not enough available space for physical. SWB requests that this option be made available at the intrastate level. On reply, SWB comments that "the proponents of the rule do not adequately rebut" SWB's position regarding virtual vs. physical collocation. SWB believes either form of interconnection can offer adequate interconnection opportunities, if designed properly. Furthermore, SWB comments, the requirement to file collocation tariffs and regulatory oversight would protect against any possible "abuses" by LECs. MCI comments on reply that contrary to GTE's suggestion, establishing physical interconnection as the preferred standard does not restrict the LECs in negotiating fair collocation arrangements. Regarding LEC concerns about their space needs, MCI asserts that it is not necessary for the Commission to address the issue, because the FCC has already done so. The FCC allows LECs to set aside space for future growth needs. [Expanded Interconnection with Local Telephone Company Facilities, Report and Order, CC. Docket Number 91-141, FCC 92-440 (adopted September 17, 1992) 7 FCC Rcd 7369, appeal pending sub nom. Bell Atlantic Corp. v. FCC , Number 92-1619 (D.C. Cir., filed Nov. 25, 1992), at para. 79.] (hereafter "Initial Order").] The Initial Order also allows LECs to provide virtual collocation at such time as existing space available for physical collocation is exhausted. MCI supports mirroring this aspect of the Initial Order and "rejecting the LECs' meritless arguments regarding their 'choice' of interconnection arrangements." MFS comments on reply that the "option" the LECs are requesting is the option "to force interconnectors to use two different interconnection arrangements at a single location," one for interstate services and one for intrastate services, the "obvious intent" of which is to artificially raise costs for interconnectors and ultimately delay the services. MFS argues that this has "no public benefits" and will ultimately harm Texas ratepayers, who will end up bearing the cost of duplicative facilities. The Commission agrees with the commenters that physical interconnection should be the required standard. Physical and virtual collocation basically differ in terms of where the interconnector's facilities terminate at the LEC central office, and in ownership of the interconnection electronics. The Commission agrees with AT&T that it is inefficient for the interconnector to have to negotiate two different collocation arrangements, one for interstate and one for intrastate. The Commission also agrees with the commenters that interconnectors will be at a considerable disadvantage if the LEC can demand a virtual collocation arrangement. The Commission agrees with TCG that denying the interconnector the ability to demand a physical collocation arrangement, deprives the interconnector of the ability to control a key part of its service, namely the interconnection electronics. Furthermore, as pointed out by several of the commenters, the original language allows for virtual collocation under the same conditions as it is allowed under the FCC's policies. The Commission believes these conditions are sufficient to meet the LECs' concerns. Contrary to several of the LECs' claims, under the FCC's policy, and therefore the proposed rule, LECs will have the option to negotiate a virtual collocation arrangement with interconnectors. However, the virtual collocation arrangement must be mutually agreed upon by the LEC and the prospective interconnector; it cannot be imposed on the interconnector, as the LECs would prefer. Giving the LECs the "final say" regarding the interconnection standard is contrary to the intent of this rule, which is to provide for a more open and competitive network. Furthermore, the FCC (and therefore this rule) allows for virtual collocation at any central office where an exemption from physical collocation has been granted due to space limitations (Initial Order at paragraphs 77-78.) The Commission believes this should allay the LECs' concerns about space limitations and the potential for being forced to incur network inefficiencies. Therefore, the Commission declines to make any change to the published language. Physical collocation will be the required standard for intrastate expanded interconnection, subject to the same exceptions as are available for interstate expanded interconnection. In its comments regarding Staff's initial recommendation, the GTE companies strongly believes the Commission should not adopt a physical collocation standard. AT&T, however, expresses strong support for the initial recommendation. AT&T urges the Commission to maintain the physical collocation requirement: "Under no circumstances should the Commission retreat from the procompetitive policy that is embodied in Staff's Initial Recommendation." For the reasons discussed previously, the Commission declines to modify the initial recommendation regarding physical vs. virtual collocation. SWB believes the proposed rule should define the terms physical and virtual collocation, and suggests using the SWB interstate tariff definitions for these terms in the rule. The Commission does not believe that it is necessary to define these terms in the rule. If definitions for physical and virtual collocation are included in the LECs' interstate tariffs, they will likely also be included in the LECs' intrastate tariffs. Inclusion of the definitions in the tariff filings will give the parties an opportunity to review the definitions, and make changes, if necessary. Therefore, no change is made to the proposed rule. SWB believes that LECs should not be required to provide intrastate expanded interconnection for more services than those offered in its currently effective interstate collocation tariff, specifically, High Capacity Special Access Service (1.544 Mbps or DS1) and MegaLink Custom Service (44.736 Mbps or DS3). SWB states that it interprets subsection (b) as requiring expanded interconnection for no more than these two services. TCG, in contrast, believes that the Commission should require interconnection at a DS0 level, as well as at a DS1 and DS3 level. According to TCG, the FCC order required interconnection for DS1 and DS3 only. TCG asserts that such a limitation "denies the benefits of collocation to the large number of customers who currently use DS0 services." In its Reply Comments, MCI believes that a rule requiring expanded interconnection for intrastate DS1 and DS3 services, including private line equivalent services, "would be the minimum acceptable rule." The FCC requires expanded interconnection be given for special access DS1 and special access DS3. The FCC also requires LECs to file tariffs to provide for the expanded interconnection of fiber optic and microwave special access services other than DS1 and DS3 service within 45 days of receipt of a bona fide request. (Initial Order at paragraphs 259 and n. 603). The published version of the rule required that LECs file tariffs to implement expanded interconnection for intrastate special access services within 30 days of the effective date of the rule. It appears from the comments that there was at least some potential for confusion as to what special access services were included in the rule. To address this concern, the Commission modifies subsections (b)>>, (c), and (e) to specifically set forth when expanded interconnection must be offered for various special access services. As modified, the rule requires LECs to file tariff amendments within 30 days of the effective date of the rule, to offer intrastate expanded interconnection for those special access services that are available at the interstate level, specifically, special access DS1, DS3 and those special access services for which interstate expanded interconnection has been granted pursuant to a bona fide request at the interstate level. Expanded interconnection for those special access services for which interstate expanded interconnection has been granted pursuant to a bona fide request will be made available at the same locations, in the same manner, and except for price, under the same terms and conditions as expanded interconnection for that service is available at the interstate level. In response to concerns raised at the workshop and in the written comments, the Commission modifies the proposed rule to allow for a 270 day phase-in of the expanded interconnection requirement for the remaining intrastate special access services, i.e. those for which interstate expanded interconnection is not available, as well as for private line services, as defined in sec.23.61 of this title (relating to Telephone Utilities). Changes to the rule regarding private line services will be discussed in detail below. In its comments regarding Staff's initial recommendation, TCG agrees that 30 days "is a reasonable time period" for the LECs to file intrastate special access interconnection tariffs to offer intrastate expanded interconnection for special access DS1, DS3 and for those special access services that are available at the interstate level. However, TCG disagrees that the LECs need 270 days from the effective date of the rule to file tariffs to implement expanded interconnection for other special access services. TCG recommends that the rule be modified to require LECs to file these tariffs within 90- days of the effective date of the rule. TCG further comments that the LECs should tariff expanded interconnection for special access below 1.544 Mbps (DS0) within the 90 day time period, because, TCG asserts, there is a market need for expanded interconnection for DS0 services. In its response to Staff's initial recommendation, SWB states that one positive aspect of the current version is that it clearly states that the initial services subject to expanded interconnection are limited to DS1, DS3 and those services for which interstate expanded interconnection has been granted. Furthermore, although it still believes the expanded interconnection requirement for all special access services should be eliminated entirely, SWB comments that "the '270-day phase-in period' is somewhat helpful from an implementation perspective." However, SWB recommends that in lieu of the proposed requirement that the LECs automatically provide expanded interconnection for all special access services within 270 days, "such additional services should only be made available for interconnection upon receipt of a bona fide request." In its response to Staff's initial recommendation, the GTE companies state that although it recommends that the application of the rule be limited to DS1 and DS3 services, "in the alternative, GTE supports the 270-day phase-in period incorporated in the most recent version of the rule." The Commission believes, for the reasons discussed previously, that the timeline established in the initial recommendation balances the interests and concerns of the parties and best implements the Commission's policy on this issue. Therefore, no change to the initial recommendation is made. United believes that interconnection should be limited to fiber and microwave only: "Copper interconnection should not be allowed due to the excessive amount of manhole and conduit space required by copper cables." The FCC requires expanded interconnection of both fiber optic systems and, where reasonable feasible, microwave transmission facilities. (Initial Order at paragraph 98.) The FCC ruled that interconnection of non-fiber optic cable should be permitted only upon FCC approval of a showing that such interconnection would serve the public interest in a particular case. (Initial Order at paragraph 99). The FCC delegated authority to the Common Carrier Bureau Chief to act on such requests. (Initial Order at note 233.) The Commission agrees with the FCC's policy on this issue, and interprets the phrase "terms and conditions" as used in the proposed rule, to include the FCC's policy regarding expanded interconnection for non- fiber technology. Intrastate expanded interconnection is granted for fiber optic and, where feasible, microwave facilities. Intrastate expanded interconnection for non-fiber optic cable will be granted only when the FCC has approved such interconnection, at the same locations, in the same manner, and except for price, under the same terms and conditions as that interconnection is offered at the interstate level. In its response to Staff's initial recommendation, SWB comments that it is positive that the proposed rule is limited to expanded interconnection for fiber optic and microwave facilities, and non-fiber optic cable only when the FCC has approved such interconnection. In its response to Staff's initial recommendation, TCG comments that regarding staff's belief that interstate "terms and conditions" refers to the FCC's requirement that expanded interconnection apply only to fiber optic technologies and staff's recommendation that intrastate expanded interconnection apply only to fiber and microwave, it "does not disagree with this conclusion, as long as it only relates to the facilities used to go from the collocator's network to its collocation space in the LEC central office." According to TCG, the DS1 and DS3 cross connections used by TCG and the LECs themselves use copper facilities, so TCG contends that this limitation should not be applied to the cross connection. TCG comments that mandating interconnection only for fiber optic or microwave facilities is reasonable as long as the Commission does not permit the LECs to refuse to provide copper cross connections. The Commission believes that it is appropriate to follow the FCC's policy on this issue. United comments that it believes expanded interconnection should be available for the interconnection of transmission and multiplexing equipment only. LECs should not be required to house non-transmission and multiplexing equipment such as customer's PBXs in their central offices. United recommends that the Commission concur with the FCC by not requiring LECs to provide interconnection to enhanced service provider (ESP) or customer premises equipment (CPE) in the central office. Since the rule requires that intrastate expanded interconnection be provided "at the same locations, in the same manner, and, except for price, under the same terms and conditions" as expanded interconnection is offered for interstate special access service, the Commission agrees that the FCC's policies with respect to expanded interconnection for ESP or CPE equipment will apply with respect to intrastate expanded interconnection as well. The GTE companies agree that consistent terms and conditions should be maintained between the interstate and intrastate jurisdictions as set forth in subsections (b) and (c) of the proposed rule, but believe that the same requirement should be extended to price: "Consistency of all terms and conditions, including price, will discourage tariff shopping." Regarding subsection (b), SWB comments that "price" need not be the same but could be the same as the interstate rates and charges: "An automatic prohibition against rate parity is unwarranted." The Commission does not intend to prohibit parity with interstate rates. The Commission intends the phrase "except for price," used in subsections (b) and (c) to simply mean that the LEC is not required to propose rates that are in parity with interstate rates. Furthermore, subsection (e)(3) of the rule allows for an exemption from the requirements of sec.23.26(c)(6) for rates proposed that are the same as the charges in effect for the LECs' interstate provision of the same, equivalent, or substitutable service. The Commission believes that the intent of the rule is clear. LECs have the option of proposing a rate at parity with the applicable interstate rate or establishing a rate in accordance with sec.23.26(c)(6). Regarding subsection (b), SWB expresses concern that if the rule is adopted as proposed, there could be disputes over whether intrastate services are "equivalent" or "substitutable" for interstate services, potentially "unintentionally" broadening the services subject to collocation at the intrastate level." SWB suggests that the rule require intrastate collocation for "those special access services that are offered and specified in [the LECs] interstate special access collocation tariff." The Commission agrees with SWB in part. Specifically, the Commission agrees with SWB that the phrase "same, equivalent, or substitutable interstate services" could be confusing, and lead to debates over what constitutes a substitutable or equivalent service. Therefore, in subsections (b) and (c), the Commission substitutes the published language with language requiring that intrastate expanded interconnection be offered on the same terms and conditions as it is offered for "interstate special access services." The Commission notes, however, that the services subject to intrastate expanded interconnection are indeed broader than at the federal level. Subsection (c) of the rule extends the expanded interconnection requirement to include services beyond those offered at the federal level. The Commission also notes that while the rule generally requires that intrastate expanded interconnection be offered "at the same locations, in the same manner, and except for price, under the same terms and conditions" as interstate expanded interconnection is offered, the rule allows for deviations from the interstate provisions, when so ordered by the Commission. In general, these departures are intended to be the exception, rather than the rule. The Commission makes some modifications to the wording in subsections (b) and (c) of the rule to clarify its intent. The second question asked in the preamble to the proposed rule, was whether the following language should be used in lieu of the first sentence of proposed subsection (c): "Each local exchange carrier that is subject to this section shall offer expanded interconnection for all of its private line and virtual private line services that provide functions that are not otherwise available through special access services." (Emphasis added.) The published version of subsection (c) required that expanded interconnection be offered for all of the LECs' private line and virtual private line services. MFS opposes the proposed alternative language for subsection (c) of the rule. According to MFS, this language would "enable the LECs to exclude nearly all of their private line services from expanded interconnection, since special access services either already offer the same functionalities as private lines" or could easily be modified to do so. The distinction between the two services is not one of functionality, but rather a restriction on uses and users. MFS asserts that an intrastate expanded interconnection rule that applies only to special access would be "essentially meaningless" if it did not also apply to functionally identical private line services, "which are of far more significance in the marketplace." Furthermore, MFS observes, "Exclusion of private line services from the proposed rule would sanction continuation of the LECs' virtual monopoly over such services to the detriment of customers who could benefit from the technical innovations and quality improvements that competition would bring." Sprint comments that the alternative proposed language for subsection (c) "is not reflective of the intent of this rule." According to Sprint, all functions and features should be available on an unbundled basis for both special access and private line customers. AT&T comments that the published language for subsection (c) is appropriate because "private line and special access services, irrespective of the jurisdiction, are functionally equivalent services." The alternative language proposed, however, would "effectively exempt all functionally equivalent private line services", and therefore, according to AT&T, should not be adopted. Further, AT&T asserts, if expanded interconnection for private line services is not required, "the potential exists for LECs to discriminate in the price, terms and conditions on which private line service is offered and thereby impede special access competition." Regarding the proposed alternative language to subsection (c), MCI comments that although it "does not object strongly to the suggested alternative," it points out a "potentially significant problem" with the LECs' Private Line Service tariff structure. This tariff structure, which predates divestiture is, according to MCI, "an antique badly in need of massive refurbishing." The resale prohibitions contained in the private line tariffs, MCI contends, could enable a LEC to engage in anticompetitive behavior toward an entity seeking to furnish a competitive point-to-point intraLATA service. While the entity would have to order the LEC's special access services, the LEC could offer to provide the service to the end user from its private line service tariff at a "completely different tariff structure and corresponding rate levels." To reduce the potential for such anticompetitive conduct, MCI recommends the Commission, at a minimum, remove the resale prohibition from the private line tariff. TCG comments that the first sentence of proposed subsection (c) should be amended to require expanded interconnection for all private line and virtual private line services that provide functions that are not otherwise available through special access services. TCG states that while special access services and private line services are technically the same, the "vast majority" of special access services are jurisdictionally interstate in nature. Therefore, while a "Commission rule pertaining to special access services only is of little value to intrastate customers only", application of the rule to private line services will "extend the benefits of interconnection to intrastate consumers." In its Reply Comments, TCG recommends against adoption of the proposed replacement language for subsection (c), because of the its concerns about the apparently different interpretations of the alternative language made the commenting parties. Regarding subsection (c), SWB maintains that there is no need to offer expanded interconnection for private line services; at most LECs should be required to make all functions found in the private line tariff available in the special access tariff. SWB believes that this approach is consistent with the alternative language for subsection (c) suggested in the preamble to the proposed rule. SWB contends that although private line service and special access service are similar to the degree that both provide non-switched point- to-point services, "[t]hat is where the similarity ends." SWB asserts that private line services were intended to be LEC retail offerings, while special access services, which were created as "the direct result of divestiture," were intended to be LEC wholesale offerings. SWB is concerned that the proposed rule could "wipe [it] out of the retail private line market. " Because, according to SWB, the existing rate structure for private line is premised on an "end-to-end" design, while special access service is designed and costed on an "end link" basis, this difference in approach has led to differences in rate elements, costs and rates. Further, SWB contends that "there is no practical or regulatory need" to include private line services since, according to SWB, interconnectors can obtain all the functions they need through the special access tariff, the bulk of private line services are copper-based analog services, while most potential collocators use fiber optic/digital facilities, and the rates for special access services are lower than the comparable private line service. SWB is also concerned that if private line services are unbundled, customers could engage in unfair rate arbitrage. SWB contends that if the "real concern" with private line services are the rates, that concern should be addressed in an "appropriate statutory manner" and not on a "piecemeal" basis in a rulemaking. SWB believes that the alternative language proposed for subsection (c) is "more reasonable" than a "wholesale" collocation requirement for private line services. SWB proposes to accomplish this by making private line functions that are not otherwise available through special access, available in the special access tariff. The TTA believes subsection (c) of the proposed rule should be eliminated in its entirety, since subsection (b) enables interconnectors to obtain expanded interconnection for DS1 and DS3, which is primarily what is offered in the interstate tariffs. The TTA observes that the private line tariffs contain a variety of services other than DS1 and DS3. If the Commission is concerned that the private line tariffs include some functionalities that interconnectors could not obtain from the special access tariffs (which the TTA believes it does not), the TTA recommends that concern be addressed by adding language to subsection (b) that would make any functionality in the private line tariff not included in the special access tariff available in the special access tariff. The TTA also points out that the rates for DS1 and DS3 are generally lower in the special access tariff than in the private line tariffs, and therefore interconnectors will not be disadvantaged as to price if subsection (c) is deleted. The GTE companies concur in and fully support the comments of the TTA regarding the elimination of subsection (c). TSTCI recommends that the issues of expanded interconnection for private line and removal of resale restrictions be removed from this rulemaking because they are "well beyond the scope" of the FCC's proceedings on expanded interconnection and therefore, "no record, either at the FCC or for this Commission, has been established for these two issues." TSTCI suggests that this issues be pursued in an evidentiary proceeding, "to determine if there is any public benefit" to incorporating either of these issues into the Commission's expanded interconnection policy. TSTCI recommends that in its investigation of these issues, the Commission should include a study of the impact competition will have on the LECs' private line services. If the Commission ultimately decides to incorporate the private line and resale issues into its expanded interconnection policy, the Commission will need to "simultaneously implement changes to its pricing policies...because several of these pricing policies are not based on cost." In its Reply Comments, TCG asserts that SWB's claim that it will be wiped out of retail private line market is "absolutely ridiculous." TCG comments that is highly unlikely a "few competitors with their limited networks" will be able to wipe out an "entrenched provider like SWB." Furthermore, TCG notes, "collocation means that TCG will continue to purchase LEC services, rather than totally bypass the LEC..." In addition, TCG comments, the Commission should not protect a provider who demands that it be protected, by denying its customers choice. AT&T comments, on reply, that if expanded interconnection for private line services is not required, the potential exists for LECs to discriminate in the price, terms, and conditions on which private line service is offered and thereby impede special access competition." AT&T asserts that since most special access circuits are interstate circuits, in order for the Commissions intrastate expanded interconnection policy to have "potency," it must apply to all private line services. SWB argues on reply that if there is no distinction between private line and special access services (other than resale), then there is no reason to include private line service in the rule. SWB contend that supports for the removal (or at least limitation) of private line services is not limited to LECs, as MCI, for example did not object to the proposed alternative language for subsection (c). Regarding MCI's argument that the private line tariff needs to be "refurbished", SWB asserts that "any such refurbishing must take place in a ratemaking/evidentiary proceeding and not in a rulemaking proceeding. The Commission disagrees with SWB and the TTA's assertion that it is not necessary to give expanded interconnection for private line services because the functions provided by private line services are essentially the same as those provided by special access services. Excluding private line services from the provision of the rule excludes private line customers from benefiting from the Commission's expanded interconnection policy. Whereas the functions interconnectors need to provide expanded interconnection may be available from both the special access and private line tariffs, interconnectors will be limited to serving special access customers if expanded interconnection is limited to special access services. The Commission agrees with MFS, Sprint, AT&T and TCG that expanded interconnection for private line will make the benefits of expanded interconnection available to more consumers, thereby promoting the Commission's policy goals of customer choice and increased competition. Merely making private line functions that do not have a functionally equivalent special access counterpart available in the special access tariff will not sufficiently further this goal. The Commission also agrees with AT&T that the potential for anti-competitive conduct exists if expanded interconnection for private line is not available. Without expanded interconnection for private line services, the potential exists for LECs to price below the interconnectors service offerings with their private line services, while the interconnectors are forced to purchase special access services. This anti-competitive pricing of private line services could occur either by changing tariffed prices for private line services, or though customer specific pricing, which is permitted for high speed private line services of DS1 and higher pursuant to PURA, sec.18(e)(3)(b), discussed in detail below. The availability of customer specific pricing for certain high speed private line services makes the need for granting expanded interconnection for private line services particularly acute. Moreover, the functional similarity of special access and private line services, which was pointed out by virtually all of the commenters, makes the need for private line expanded interconnection even more compelling, not less, as argued by the LECs. It is the functional similarity of the services that creates the potential for anti-competitive behavior when the LEC offers a service (private line) to a customer at less than a competitor is able to purchase a functionally similar service (special access). Therefore, in recognizing the need for granting expanded interconnection for private line services, including those that are functionally equivalent to special access services, the Commission declines to adopt the alternative language for subsection (c). While the Commission disagrees with the LECs that it is not necessary to include private line services in the rule, the Commission recognizes their concerns regarding the current private line rate structure. Therefore, the Commission modifies subsections (c) and (e) of the rule to provide for a 270-day phase-in period of the expanded interconnection requirement for private line services. The Commission believes this will give LECs adequate time to submit an application to modify their private line tariffs, if necessary, to prepare for the implementation of expanded interconnection for private line. As modified, subsections (c) and (e) of the rule requires LECs to file tariffs to offer expanded interconnection for private line services not later than 270 days after the effective date of the rule. In its response to Staff's initial recommendation, AT&T urges the Commission to keep the expanded interconnection requirement for private line services. TCG, however, disagrees that the LECs need nine months from the effective date of the rule to file tariffs to implement expanded interconnection for other private line and special access services. TCG believes that this proposal "unnecessarily delays full implementation of expanded interconnection in Texas." TCG recommends they be required to file these tariffs within 90 days or less from the effective date of the rule. In its response to Staff's initial recommendation, the GTE companies recommend that the application of the rule be limited to DS1 and DS3 services, and should not be extended to apply to all special access and private line services. "However, in the alternative, GTE supports the 270-day phase-in period incorporated in the most recent version of the rule." Similarly, SWB comments, in its response to Staff's initial recommendation, that although it still believes the expanded interconnection requirement for all private line services should be eliminated entirely, "the '270-day phase-in period' is somewhat helpful from an implementation perspective." However, SWB recommends that in lieu of the proposed requirement that the LECs automatically provide expanded interconnection for all private line services within 270 days, "such additional services should only be made available for interconnection upon receipt of a bona fide request." The Commission believes, for the reasons discussed previously, that the timeline established for the private line expanded interconnection requirement in the initial recommendation balances the interests and concerns of the parties and best implements the Commission's policy on this issue. Therefore, no change to the initial recommendation is made. In its comments regarding Staff's initial recommendation, TSTCI contends that the smaller LECs will also be directly affected by the proposal to include private line services as part of the rule, because several TSTCI member companies concur in SWB's private line service tariff for intraexhange services and all TSTCI member companies are concurring carriers for interexchange intraLATA private line services. As a result they will have to comply with any changes ordered within SWB's private line tariff as a result of this rule. TSTCI contends that its members will have to implement changes to their billing system to implement any disaggregated rate structure. TSTCI contends that expanding the potential use of private line services will create "significant opportunities for misreporting the correct jurisdiction on dedicated services to take advantage of the lower rates found in the intrastate Private Line Service Tariff" because "[p]olicing the correct jurisdictional reporting on dedicated circuits is virtually impossible." TSTCI also expresses concern that extension of interconnection capabilities to the private line tariff will "cause significant rate arbitrage for all LECs" and will create significant differences in rates between the interstate and intrastate jurisdictions, and between special access and private line. TSTCI contends that the removal of resale restrictions for private line services is "contrary to all past Commission policies regarding assessment of access charges on IXCs or other types of resellers." The Commission understands TSTCI's concern. However, this rule does not apply to non Tier 1 LECs. Therefore, the requirements of the rule, including the removal of resale restrictions, expanded interconnection, and unbundling requirements are not intended to apply to non Tier 1 LECs. In its response to staff's initial recommendation, SWB also expresses concern that if expanded interconnection is given for private line and special access, some customers may engage in unfair rate arbitrage by mixing and matching rate elements from each service that "have been rated in fundamentally different manners." The Commission believes that the 270-day phase-in for the private line expanded interconnection requirement will provide LECs with the sufficient time to propose tariff changes to eliminate rate arbitrage opportunities, should such opportunities exist. In its Reply Comments, MFS proposes a two-part test for exempting private line services from the expanded interconnection requirement, and suggests alternative language for subsection (c). Under this alternative, a LEC would not have to provide expanded interconnection for a private line service (and would therefore not be required to unbundle or remove resale restrictions for that service) if it can demonstrate that (a) equivalent functions are available under the special access tariff, and (b) that the total price for the private line service is not less than the price of the special access service elements providing the equivalent functionalities, plus other relevant costs of the private line service. According to MFS, if a particular service does not satisfy the test, the LEC could either make expanded interconnection available for the service, or revise its private line and special access tariffs to satisfy the pricing and availability tests. MFS believes this test meets the needs of both interconnectors and the LECs. The Commission appreciates MFS's suggestion. However, for the reasons discussed above, the Commission believes it is imperative to grant expanded interconnection for all private line services. In addition, the Commission is concerned that it would be difficult to implement the provisions of part (b) of the two part test recommended by MFS. TSTCI notes that the issues of private line and removal of resale restrictions are very important to small and rural LECs. TSTCI expresses concern that if the policy issues regarding resale of private line are not addressed now, the resale and sharing restrictions on local exchange services may not be reviewed at the time switched interconnection is implemented. TSTCI believes that this is an "extremely important issue" because of the potential financial harm that could occur to small and rural LECs if resale and sharing restriction for local exchange service are removed at the time switched interconnection is in place. TSTCI believes that such a change would "completely undermine" the Commission's past policy decisions regarding access services. The Commission believes that TSTCI's concerns regarding the removal of resale and sharing restrictions for switched services are unfounded at this time, because the Commission is not proposing to remove such restrictions for switched services in this proceeding. TSTCI's concerns are best addressed at the time such an issue is considered. At that time, TSTCI's concerns will be carefully weighed and considered, as the Commission has done with respect to the comments raised in this proceeding. The GTE companies "do not oppose expanding the rule to include DS1 and DS3 private line services" however, "virtual private line services are not as easily identified, and more importantly, not part of the interstate mandated set of service for either special or switched expanded interconnection service. " Both SWB and the TTA also express concern with the inclusion of the term "virtual private line" in subsection (c). The TTA recommends that if the Commission decides to leave subsection (c) intact, at a minimum the Commission should delete the reference to "virtual private line services" since the term as defined in sec.23.61 includes some switched services, such as frame relay services. SWB also expresses concern with the inclusion of the term "virtual private line services." SWB maintains that it does not offer such services, as defined in sec.23.61, in either its private line or special access tariffs. The services closest to this definition are Microlink I and II and Frame Relay service, both of which are switched services. Thus, inclusion of these services in the expanded interconnection requirements, SWB believes, will go beyond collocation for special access. The Commission recognizes the concern of SWB, the TTA, and the GTE companies that the term "virtual private line" could potentially be construed to include some switched services. Furthermore, the Commission is not persuaded by any of the commenters that a need for expanded interconnection with virtual private line is needed at this time. Therefore, the Commission deletes the reference to "virtual private line" services in subsection (c). In addition, to avoid possible confusion, the Commission modifies the reference to "private line services" in subsection (c) to read "private line services, as that term is defined in sec.23.61 of this title (relating to Telephone Utilities)." Subsection (d)(1) requires local exchange carriers to file tariff revisions to unbundle each service for which expanded interconnection is to be offered. As used in subsection (d)(1), to unbundle means to make available, on an unrestricted basis, the individual rate elements necessary to provide a special access or private line service. AT&T comments that the proposed unbundling requirement is good, but does not go far enough. AT&T asserts that unbundling to the level of basic network functions is "an absolute necessity to introduce competitive interconnection arrangements." Without such unbundling, the LEC could "effectively design bundled interconnection arrangements that require interconnectors to purchase network functions they do not need, thereby creating insuperable cost barriers for alternative access providers." MCI similarly comments that it believes the proposed language incorrectly implies that the rate elements, rather than the network functions, provide to interconnectors the functions they require. MCI suggests changing the phrase "rate elements" to "network functions" in subsection (d)(1). AT&T and MCI's comments concern the Commission's recently adopted sec.23.91, Long Run Incremental Cost Methodology for LEC Services. That rule requires LECs to identify and cost basic network functions (BNFs), which are defined as "a discrete network function, which is useful either as a stand-alone function or in combination with other functions, for which costs can be identified." GTE and SWB have submitted workplans pursuant to sec.23.91, which are currently in the process of being reviewed. These workplans identify the BNFs. Since the BNFs have not yet been approved, the Commission did not want to make the unbundling requirement of this rule, sec.23.92, contingent on approval of the BNFs identified pursuant to sec.23.91. This does not mean, however, that there will not be a convergence of the two at a later date. In fact, the BNFs that make up special access and private line services will be identified and costed pursuant to the guidelines established in sec.23.91. The identification and costing of BNFs will enable the services subject to the expanded interconnection requirement to be further unbundled to the BNF level. However, in an effort not to delay instituting the unbundling requirements for sec.23.92, the Commission declines to modify subsection (d)(1), as requested by AT&T and MCI. SWB comments that the unbundling requirement in subsection (d)(1) goes beyond that required by the FCC. According to SWB, the FCC considered formally unbundling interstate special access and declined to do so (Initial Order, at paragraph 120). Instead, the FCC instituted a new connection charge. SWB contends that it is "unclear why the proposed rule repeatedly goes beyond the FCC's requirements, when the stated intent is to mirror the federal rule." Furthermore, SWB maintains that the costs and network implications of unbundling have not been studied, there has not been any real demand for unbundling (other than from CAPs), and unbundling is simply not needed to promote competition. "Unbundling should not be required just for the sake of unbundling." Regarding subsection (d)(1), the TTA maintains that expanded interconnection can be accomplished without the need for unbundling. The TTA observes that the FCC reviewed this issue, and concluded that unbundling was not necessary for special access expanded interconnection. The GTE companies concur in the comments of the TTA and recommend that the requirement for unbundling be deleted. The GTE companies maintain that, as shown by the Initial Order, expanded interconnection can be accomplished without unbundling. The Commission disagrees with the LECs that unbundling is not a necessary component of an expanded interconnection policy. Unbundling allows interconnectors and other customers of the LECs to purchase the individual components of a service separately. An unbundled special access tariff will, for example, enable a customer to purchase part of its service from a LEC, and part from a competitive access provider. Unbundling thereby increases customer choice, and is consistent with the promotion of a more competitive marketplace, two of the fundamental goals of an expanded interconnection policy. Further, an unbundled tariff allows a customer to purchase only those portions of a service that the customer needs, thereby reducing costs and promoting efficiency. An unbundling requirement also eliminates the potential for a LEC to bundle service offerings in such a way as to thwart competition, for example by requiring a competitor to purchase more components of the service than are needed. Furthermore, the Commission disagrees with SWB's suggestion that it cannot go beyond the requirements of the FCC. As stated previously, the Commission followed the FCC policy where the Commission found it to be an appropriate policy for Texas, and deviated from, or expanded upon the FCC's policy, when it found it to be in the public interest of the citizens of Texas. Therefore, the commission declines to make any changes to subsection (d)(1). LECs will be required to unbundle each service for which expanded interconnection is offered. This requirement includes not only offering the expanded interconnection components of the service on an unbundled basis, but also unbundling those special access and private line services for which expanded interconnection is offered. AT&T also disagrees with the LECs' comments, recommending in its Reply Comments that the Commission reject the LECs' proposal to delete the unbundling requirement. According to AT&T, "a true market test for competition cannot be achieved without unbundling." AT&T comments that the Commission "should not hesitate to be even more progressive than the FCC in promoting competition -and unbundling is indisputably procompetitive." AT&T also notes that the LECs fail to identify any public policy detriment that would result from unbundling. Regarding the unbundling requirement set forth in subsection (d), SWB comments in its response to Staff's initial recommendation, that "[i]f the Staff actually intends (as Southwestern Bell assumes) that the LECs 'mirror' the federal collocation tariffs and 'unbundle' special access (and private line) only to the limited degree that the FCC ordered (i.e., a new connection charge), it should further clarify its initial recommendation in subsection (d) ." If, on the other hand, "the Staff is not inclined to clarify the unbundling requirement, it should be eliminated in its entirety as an unnecessary, unlawful and unworkable requirement." In its response to Staff's initial recommendation, SWB comments that it will need a significant amount of time to implement a workable plan to unbundle each service for which expanded interconnection is to be offered. The Commission believes its position regarding unbundling is sufficiently clarified in the discussion above. The Commission also believes that the timeline set forth in the rule is sufficient to implement the unbundling provisions of the rule. Therefore, no changes are made to the initial recommendation. Subsection (d)(1) of the proposed rule requires the removal of any resale or sharing restrictions for each service that is subject to expanded interconnection. Since the rule requires expanded interconnection for both special access and private line services, both are be subject to the removal of resale or sharing restrictions. The focus of the parties comments, and the LECs concerns, was on the removal of resale and sharing restrictions for private line services. AT&T comments that the elimination of resale restrictions and prohibitions should be retained as part of this rulemaking. If resale restrictions were not lifted, AT&T remarks, such restrictions would permit LECs to manipulate prices or availability of specific network functions to their competitive advantage and will "prevent a true market test for competition." SWB comments that the elimination of resale restrictions for private line set forth in subsection (d)(1) is "improper." The GTE companies maintain, "the reasons for instituting resale restrictions are as applicable today as when they were first implemented." In its Reply Comments, TCG agrees with MCI that the Commission should eliminate the resale prohibition in the LECs private line tariff, because failure to do so creates the potential for anti-competitive conduct on the part of the LEC: "while a competitor would have to use the LECs' special access service for those portions of the service it could not furnish with its own facilities, the LEC could offer to provide the service to the end user from its private line tariff at anti-competitive rates." In its Reply Comments, MFS suggests that the decades-old restrictions on resale and sharing of private lines are "largely irrelevant and contrary to the public interest in today's market environment." AT&T comments on reply that the elimination of resale and sharing restrictions "is a necessary, but not a sufficient condition" for special access competition. AT&T contends that expanded interconnection must also be available for private line services to "minimize the potential for anticompetitive conduct." The Commission believes that the elimination of resale and sharing restrictions is a necessary part of its expanded interconnection policy, especially with respect to expanded interconnection for private line services. Without the elimination of resale restrictions for private line services, it is possible that expanded interconnection for private line services would be rendered meaningless because interconnectors would be unable to buy out of the private line tariff to serve their customers. Failure to eliminate resale and sharing restrictions for services subject to expanded interconnection creates the potential for a LEC to engage in anti-competitive conduct by offering an end user a service through its private line tariff at lower rates than the interconnector is able to purchase the service through the special access tariff, thereby thwarting the goals of the Commission's expanded interconnection policy. In its response to Staff's initial recommendation, AT&T supports the rule's requirement to eliminate resale restrictions. USM supports the proposed rule's removal of resale restrictions and unbundling of private line circuits, arguing that LECs have used resale as "an anticompetitive weapon." USM comments that "[t]here is not a historical, rate case or network operations basis at all" for the claim that resale is "somehow causally related to rate levels or the ratemaking process." However, USM contends that resale prohibitions should be "affirmatively rejected" for all of the LECs' facilities and service offerings, not just private line. USM recommends that resale prohibitions and use restrictions for all services be "promptly buried" by the Commission by requiring that they be removed from all tariffs filed pursuant to subsections (d) and (e) of the proposed rule. The Commission believes that USM's recommendation to eliminate resale prohibitions for all of the LECs facilities and service offerings is beyond the scope of this proceeding. Therefore, no change is made. Additionally, several LECs express concern with eliminating the resale restrictions in a rulemaking. SWB believes the Commission "cannot require LECs to eliminate the tariffed resale prohibition in a rulemaking," such a rate- impacting consideration should be the subject of a contested proceeding. In it Reply Comments, AT&T responds to this concern by stating, "[i]t is completely within the Commission's discretion to formulate policy on a case-by- case basis or in a rulemaking proceeding. [Southwestern Bell Telephone Co. v. Public Utility Comm'n of Texas, 745 S.W.2d 918, 926-27 (Tex. App.-Austin 1988, writ denied).] AT&T further notes that subsection (d) of the proposed rule requires compliance filings and "it is in these dockets that the resale and sharing restrictions would be eliminated-thereby avoiding any problem with ratemaking in a rulemaking." As previously discussed, the rule merely establishes the Commission's policy concerning the resale prohibition. This policy of general applicability is best addressed through the rulemaking procedures of the APA. Tariffs filed in compliance with this rule will be processed in accordance with sec.23.26 in the same manner as other LEC tariff offerings of new services. This procedure affords the appropriate due process protections to all parties. Additionally, this procedure does not prevent the LECs from filing a PURA, sec.43 rate proceeding if they believe that their revenues have been adversely affected by the elimination of the resale prohibition. The GTE companies believe that an evidentiary proceeding should be initiated to fully examine the implications of eliminating resale restrictions. The TTA also believes the Commission should conduct evidentiary hearings to determine if it is in the public interest to implement collocation for private line service, eliminate resale restrictions and order unbundling. TSTCI comments that it is disappointed with the Commission's decision not to pursue the issue of expanded interconnection for private line services and resale issues through an evidentiary hearing. The Commission disagrees with these suggestions. There are no fact issues to be decided in this proceeding. The only issues to be decided are issues of policy regarding the steps the Commission should take to promote competition in the intrastate special access and private line markets. The LECs' primary concern about the rule deal with its potential effect on their revenues. Since the rates, terms and conditions for the new services will not be known until after the compliance procedure, any evidence on this point would be speculative, at best. A contested, evidentiary proceeding on this question would be unlikely to produce any "facts" which would be helpful in reaching a decision on the policy issues. Such a proceeding would only serve to delay a decision on these issues. Regarding subsection (d)(2), TCG recommends that the Commission require the LECs to tariff floor space and other critical interconnection elements. "To promote uniformity between interstate and intrastate interconnection," TCG recommends that the Commission expand the scope of "connection charges" in subsection (d)(2) and direct the LECs to tariff the following non-recurring rate elements: cage construction, power cabling and racking, and the cable pull. Interconnectors should have the option to complete these tasks themselves. Furthermore, TCG suggests, LECs should tariff the following recurring rate elements: cable space, cross-connect, floor space, and electric power. TCG also prescribes the following set of terms and conditions that it recommends the Commission require the LECs to indicate in their tariffs that they will abide by. First, rearrangement charges must be non-discriminatory. Second, interconnectors must be given channel assignment control, which refers to the determination of the assignment of the individual channels on a customer circuit. Third, interconnectors must be permitted to use letters of agency. Fourth, escort and eviction terms must be limited. Fifth, reasonable installation time frames should be tariffed. Sixth, government compliance should be the responsibility of the LEC. Seventh, interconnector should be allowed to purchase their own insurance. Eighth, there should be no restrictions placed on the types of equipment that can be installed, provided as it can be used to terminate basic transmission facilities. Finally, TCG recommends that the Commission ensure that the LEC's liability language for interconnections is reasonable. In its Reply Comments, SWB comments that TCG's "litany" of issues should either be governed by the same terms and conditions as the federal tariffs, or if such items are not covered by the federal tariffs and need to be addressed separately by the intrastate tariffs, the parties should be afforded adequate opportunity to address these issues. The Commission believes that TCG's concerns are more appropriately addressed at the time the LECs file tariffs in compliance with this section, than in the rule itself. Therefore, no change is made to the rule. The TTA recommends that subsection (d)(2) be modified to require that equipment and facilities used for intrastate interconnection, such as floor space, other than the rate elements for DS1 and DS3 be priced and be subject to the same terms and conditions as those at the interstate level. The rule already requires that intrastate expanded interconnection be offered on the same terms and conditions, except for price, as the interstate service. The Commission believes that the TTA's recommendation regarding price parity with interstate for these rate elements is best addressed at the time the LECs submit tariff filings in compliance with this section. Regarding proposed subsection (e), MCI expresses concern that the proposed rule allows for the provisions of sec.23.26(c)(6) to be waived for rates proposed at parity with those in effect at the interstate level. MCI contends that there is no reason for "what amounts to a blanket waiver" and in fact, "good reason exists for requiring detailed cost justification for whatever rates are proposed." Furthermore, the Commission's recently adopted sec.23.91, requires total service long run incremental cost studies to be performed for LEC basic network functions, an approach which is not compatible with the costing methods used by the LECs to establish interstate interconnection rates. MCI urges the Commission to reconsider the inclusion of this language, especially given that even without this provision the LEC retains the right to petition for a waiver of the requirements for good cause. The Commission understands MCI's concern, but believes that the exception from the provisions of sec.23.26(c)(6) for rates proposed at parity with rates in effect at the interstate level is warranted. The fact that the LEC is exempt from the requirements of sec.23.26(c)(6) for rates proposed at parity with interstate rates does not mean that those rates will be approved, only that the LEC does not need to submit the cost studies required by sec.23.26(c) (6). In this case, the Commission does not believe that the detailed cost justification of rates proposed at parity with interstate rates is necessary because the interstate cost studies used to determine those rates are available for examination. Furthermore, as MCI observes, a comprehensive review of LEC cost methodology is being undertaken pursuant to sec.23.91, Long Run Incremental Cost Methodology for LEC Services. sec.23.91 requires that long run incremental cost (LRIC) studies be performed for LEC basic network functions, and for LEC services. Thus, LRIC studies for the services subject to the expanded interconnection requirement will be among the service studies filed pursuant to sec.23.91. Under subsection (j)(4)(A) of sec.23.91, all cost studies must be submitted within 18 months of the effective date of the section. At the time that LRIC studies for services subject to the expanded interconnection requirement are filed pursuant to sec.23.91, the Commission may reexamine the costs and rates for expanded interconnection, if appropriate. SWB asserts that the rule is "grossly lacking from a regulatory standpoint" because the Commission has failed to consider the "myriad of important issues associated with collocation." Among the issues that SWB believes must be addressed before intrastate collocation is implemented include: the impact of collocation on universal service, residual pricing, value of service, averaged rates, and other "cornerstones of regulatory policy; what changes in regulation are necessary to allow LECs to compete on an equal basis with CAPs; is there a type of interconnection that can be implemented without "taking LECs' property"; are LECs providing local exchange services at reasonable rates; should LECs be allowed to implement new rate structures, such as local measured service; what is the impact of allowing collocation for entities other than CAPs, such as IXCs, resellers and information providers; and finally, what would be the obligations of certificated providers in such an open competitive environment. In its Reply Comments, MCI responds to SWB's concerns by stating that the existence of difficult issues "should not...be taken to suggest that the world should stand still until the Commission has explored all of the unknowns and anticipated every possible outcome." MCI believes that SWB incorrectly implies that the proposed rule is totally without merit and that it's adoption could do harm to a variety of the Commission's policy goals. MCI contends that SWB's list of issues represents an effort to present the Commission with "fear, uncertainty, and doubt" in an effort to "forestall any possible deterioration in [its] position as bottleneck provider." Moreover, SWB believes that the impact of the proposed rule on universal service in Texas must be studied, "rather than simply assumed." SWB expresses concern that the loss of special access and private line revenues resulting from expanded interconnection could adversely impact universal service. The TTA asserts that collocation may affect universal service because "as competitors displace the LECs' services, the LECs will lose some revenues previously used to subsidize other services such as basic local exchange service." The TTA maintains that the LECs may need to increase rates for basic local service to protect their revenue stream. The GTE companies also question whether any benefits will accrue to consumers on the whole as a result of interconnection: "the benefits realized by the large players through interconnection will be at the expense of the smaller ones, the rural and residential customers." The GTE companies maintain that if LECs are restricted in their ability to negotiate fair arrangement and are denied pricing flexibility, large customers may move to interconnectors' services, and "subsidies which benefit rural and residential customers will be lost." MCI responds to the concerns expressed by the LECs in its Reply Comments: "one could easily infer that a decision requiring LECs to offer expanded interconnection service...would nudge the LEC industry over the edge into a precipice of overwhelming competitive imbalances...either sharply escalating basic local exchange service rates or certain financial ruin." MCI maintains that adoption of the proposed rule does not mean either the end of universal service, nor that the LEC industry is destined to go the way of the railroads. MCI questions both the LECs' claim that revenue will be lost as a result of interconnection, and that basic local service rates will go up, adding, "[i]t is not reasonable to assume that a loss of revenue necessitates an impact on other service rates." MCI comments, on reply, that if the Commission chooses to reject or postpone adoption of the proposed rule, it will essentially have concluded that pursuit of a more open market structure, and a more competitive local exchange service market are not worthwhile policy objectives. If the Commission adopts the proposed rule, as MCI recommends, the public interest will best served by making available the numerous benefits of competition. AT&T comments on reply that "the LECs' reports of the demise of universal service are greatly exaggerated" because only a "fractional percentage of Tier 1 LEC revenues are subject to competition under the proposed rule." AT&T believes that the "speculative concern" raised by the LECs "should not be permitted to shackle this Commission's efforts" in promoting competition. TCG comments, on reply, that SWB's concerns are "misplaced"; the proposed rule "will not have a negative impact on universal service." The Commission agrees with MCI, AT&T and TCG that adoption of this proposed rule would not harm universal service. First, to the extent that adoption of this rule increases the level of competition in the telecommunications industry, it should induce the LECs to become more cost efficient. When the LECs become more efficient all of their customers can benefit, and not just the large customers that use interconnection services, as asserted by GTE. Second, the LECs are exaggerating the potential losses from expanded interconnection requirements. As AT&T correctly points out, only a small part of the LECs revenues are subject to competition as a result of the proposed rule. Further, the LECs arguments seem to be premised on the notion that they will be unable to compete and are bound to sustain large losses. The Commission, however, does not see any reason why the LECs would be less efficient than their competitors and need to lose any sales at all, let alone all of their revenues. But, if it were true that the LECs are indeed inefficient and high cost providers then, of course, it is even more important that Commission adopt this rule and allow customers access to more efficient low cost providers. Furthermore, the LECs assert that there exist a direct relationship between the revenues from special access and private line services and universal service; that is, they assert that a loss in revenues from these services necessarily must harm universal service. The Commission disagrees with the LECs and believes that there are various ways in which it can both pursue universal service objectives and make the industry more competitive. SWB also comments that the proposed rule must provide a "quid pro quo for LECs" in the form of pricing flexibility. SWB questions whether LECs really do have "bottleneck capability," in light of the "flourishing" competition that it believes already exist. SWB contends that while residential customers may remain largely dependent on LECs, other market segments including business customers, intraLATA toll and access for long distance carriers are already subject to a "great deal of competition." According to SWB the "bottleneck" label is not justified in these markets. SWB concludes that "there is no real need to promulgate a collocation rule to stimulate competition". Furthermore, SWB argues that expanded interconnection rules give CAPs the "advantage of not having to build networks to serve all customers." SWB believes that LECs should be allowed to respond to their competitors with pricing flexibility, as was recognized by the FCC. SWB contends that existing rules such as sec.23.27 (relating to Rate- Setting Flexibility for Services Subject to Significant Competitive Challenges) are "not a satisfactory response," because they "subject LECs to burdensome application requirements and lengthy proceedings." SWB asserts that it needs the ability to "price services in the same manner as other market participants," and recommends that LECs be given the ability to "price services on a customer-by- customer basis, in a proprietary manner." SWB suggests that its only regulatory obligation be that rates cover incremental costs. Moreover, since services would be competitive, SWB contends that "issues such as discriminatory pricing, appropriate packaging, and reasonable contributions would be moot." SWB warns that if LECs are not given the opportunity to compete on "an equal footing" with their competitors through pricing flexibility, consumers will not reap the benefit of true price competition. In its Reply Comments, MFS notes that "it would appear that SWBT has already received the pricing flexibility it seeks for the services that really matter" since PURA, sec.18(e)(3)(B) gives LECs some pricing flexibility for high speed private line services of 1.544 megabits or greater. The Commission disagrees with SWB. The rule allows for competition, but does not ensure it. The Commission believes that pricing flexibility for a service should not be granted until competition for that service is shown to exist. This is consistent with the Commission's policy established in sec.23.27, which requires the LEC to make a demonstration that competition exists for a service before pricing flexibility is granted. There is no reason that this same requirement should not apply to services subject to the expanded interconnection requirement. Furthermore, as noted by MFS, PURA, sec.18(e)(3)(B) requires the Commission to approve customer-specific contract for "high speed private line services of 1.544 megabits or greater" under enumerated conditions. Since most expanded interconnection is likely to involve services of 1.544 megabits (DS1) or greater (DS3), it appears that SWB already has pricing flexibility for at least some of the services for which expanded interconnection will be offered. Furthermore, it is important to note that the availability under PURA of pricing flexibility for certain high speed private line services makes the need to make private line services subject to the expanded interconnection and removal of resale restriction requirements even more urgent. In light of PURA, sec.18(e)(3)(B), if private line services are excluded from the rule, the potential for anti-competitive conduct on the part of the LEC (discussed earlier) is increased, since the LEC can flexibly price its private line service offering, while the interconnector is required to purchase special access services at tariffed rates to serve its customers. Several commenters similarly reject SWB's request for pricing flexibility. In its Reply Comments, AT&T disputes SWB's claim that it may not have bottleneck local exchange facilities" as "patently absurd." In response to SWB's belief that sec.23.27 is burdensome, MCI questions, "One is left to surmise what approach SWB would consider to be suitable. For example, would it choose to simply advise the Commission that in SWB's view reduced prices were needed to retain a particular customer?" In its Reply Comments, TCG comments that "full pricing flexibility is premature" and should not be implemented until effective competition exists in Texas. The GTE companies also believe that the pricing flexibility afforded by the FCC also be mirrored in the rule. Specifically, the GTE companies recommend that the Commission adopt the discount zones established by GTE's zone density pricing plan, and approved by the FCC. Sprint also expressed support for zone density pricing for special access as set out by the FCC, although Sprint believes that the FCC's parameters are "too narrow." Sprint contends that "only with some form of zone density pricing will the competitive access market evolve as it should." Although the proposed rule does not specifically address the issue of zone density pricing, Sprint observes that "there appears to be the possibility of a conflict within the rule regarding this issue." According to Sprint, a "narrow reading" of subsection (e) of the proposed rule, which requires that the LECs file tariffs in accordance with the rule pursuant to sec.23.26, "may lead one to believe that zone density pricing is not permitted," because subsection sec.23.26(f)(1) requires that a service be offered at the same price throughout the LEC's system throughout the state. Zone density pricing would not be consistent with such a requirement. However, according to Sprint, the language in subsection (d)(2) would allow for zone density pricing, since it states that the regulations governing connection charges "shall be the same as those contained in the carrier's interstate expanded interconnection tariffs." Sprint suggests language to clear up confusion on this issue, language that would grant a waiver from the requirements of sec.23.26(f)(1) for carriers filing tariffs under sec.23.92(d)(1) . The Commission rejects the requests of the GTE companies and Sprint to allow for zone density pricing, for similar reasons as it rejected SWB's request for pricing flexibility. As stated previously, while expanded interconnection allows for competition, it does not ensure that competition will occur. The Commission envisions that under the proposed rule new services such as services necessary to effectuate interconnection and new services created by the unbundling of individual rate elements necessary to provide special access service or private line service will be offered. The pricing of these new services is properly addressed under sec.23.26. The Commission believes that it must be demonstrated that competition for a service exists before pricing flexibility, including zone density pricing, is granted. It its Reply Comments, MCI expresses the concern that unless adequate safeguards are applied to LEC pricing, resulting prices could be predatory, foreclosing entry into the local exchange market. MCI suggests that LECs be required to cost justify all proposed rates according to the guidelines set forth in sec.23.91. MCI believes that the costing information obtained pursuant to sec.23.91 will enable the Commission to determine whether density of service area is a factor which affects the costs of various services. The Commission agrees with MCI that the costing information obtained pursuant to sec.23.91 will enable the Commission to determine whether density of service area is a cost driver. As discussed previously, LECs will be required to submit cost studies under sec.23.91 for all LEC services. These cost studies, in conjunction with the pricing rulemaking set forth in sec.23. 91(p), will be used to determine whether prices recover their costs. The Commission does not believe, however, that it is necessary to wait to approve the rates proposed under this section until the cost studies submitted pursuant to sec.23.91 are completed. The Commission will examine the rates proposed in accordance with sec.23.92 to determine if they recover their costs. Although the Commission declines to incorporate MCI's suggestion into the rule, the Commission notes that under sec.23.91, LECs are required to perform LRIC cost studies for all services. The Commission maintains the right to revisit the cost studies and rates proposed in accordance with this section in light of the cost studies for these services obtained pursuant to sec.23.91. The Commission encourages LECs to give priority to identifying, and performing cost studies for, basic network functions related to special access and private line services. SWB comments that, constitutional issues aside, reciprocity is "consistent with the concept of an open network, and could be made a term of the tariffed offering." The GTE companies similarly asserts that a provision for reciprocity should be added to the proposed rule because as competition increases, GTE and other LECs "may have a need and desire to collocate" with other providers. The GTE companies suggest language to be added that would require any person subscribing to any expanded interconnection offered pursuant to this section to "provide the local exchange carrier with unbundled interconnection to its transmission and switching facilities on reasonable and non-discriminatory terms." The TTA also recommends that a provision for reciprocity be included in the rule. While the LECs may not currently have a need to collocate in their competitors offices, as competition grows, eventually the LECs may want to collocate. TTA believes that including such a provision now "may prevent any future legal battles." Furthermore, the TTA notes that "[t]his suggestion does not imply that reciprocity should be a condition for permitting collocation." The LECs' suggested reciprocity provision is generally rejected by most of the non-LEC commenters. In its Reply Comments, MCI asserts that "there is not merit whatsoever in the notion that interconnectors should be required to make their facilities available to the LECs. Interconnectors need the facilities of the LECs for one simple reason-those facilities represent the only available means of reaching the end users." Furthermore, the LECs will have their choice of entities from whom to purchase services. It will be in the interconnector's interests, MCI believes, to negotiate with the LECs. AT&T comments on reply that the "LECs cite no public policy justification for a reciprocity requirement, and there is none." Further, AT&T comments that "[r]eciprocity bristles with anti- competitive potential-providing an opportunity for LECs to withhold interconnection on the asserted basis that the party desiring interconnection with LEC facilities has not offered interconnection to its facilities on 'reasonable terms.'" TCG comments on reply that the TTA is incorrect in assuming that it will have to engage in future legal battles should any of its members require interconnection. TCG argues that the Commission can "safely allow the market to determine the decisions" of competitive providers, while "ensuring that monopoly carriers properly provide expanded interconnection arrangements to permit the development of competition." TCG and AT&T further comment that the FCC did not require a reciprocity provision, although the issue was considered. According to TCG, the FCC "saw no reason to mandate such a requirement because [competitive access providers] do not control bottleneck facilities." Furthermore, TCG notes, there has been no record developed regarding the need for reciprocal interconnection, the rules that would apply, and the reasonableness of imposing such a requirement on carriers that do not file tariffs, and other basic questions of implementation. MFS comments, on reply, that it stands "ready, willing, and able" to provide interconnection to its networks to LECs, whether or not required by the Commission to do so. MFS does not oppose a "reasonable" reciprocity provision, however it sees "no need" for the Commission to exercise "unprecedented jurisdiction" over non-dominant carriers, because market forces will compel reciprocal interconnection. Regarding reciprocity, SWB comments on reply that "[n]o logical reason has been offered by proponents of the rule to support the notion that expanded interconnection should only be a 'one-way street.'" The Commission concurs with the arguments of MCI, AT&T, TCG and MFS regarding reciprocity. Despite SWB's arguments to the contrary, the LECs own the bottleneck facilities. It is, in fact, the LECs' ownership of the bottleneck that drives the need for a service such as expanded interconnection. If market forces were sufficient to compel the LECs to provide expanded interconnection, there would be no need for this rule. The Commission agrees with MCI, MFS and TCG that market forces are sufficient to prompt interconnection on the part of the interconnectors because LECs will have a choice of entities to purchase service from. These entities will have an incentive to compete for the LECs' business. Furthermore, the Commission believes that a reciprocity provision will be difficult to enforce, because interconnectors do not file tariffs with the Commission. The Commission therefore declines to modify the proposed rule to include a provision for reciprocity. TCG recommends that the Commission institute a "fresh look" provision, which would allow customers to terminate their long term contracts with the local exchange carriers without fear of incurring substantial termination liabilities. TCG contends that precedents for such action exist at the federal level. TCG recommends that the Commission mirror the FCC's fresh look provisions as modified in its reconsideration of the Expanded Interconnection Order. [ Expanded Interconnection with Local Telephone Company Facilities , Second Memorandum Opinion and Order on Reconsideration, 8 FCC Rcd. 7341 (1993) (hereafter Second Memorandum Opinion).] The Commission's authority to set aside contract provisions is limited. In High Plains Natural Gas Company v. Railroad Commission of Texas, 476 S.W.2d 532 (Tex. Civ. App.-Austin 1971, writ ref'd n.r.e.), the court held that a contract entered into between a utility and a customer could be revised by a regulatory authority (the Railroad Commission in that case) upon a showing that "the continuance of the contract would adversely affect the public interest". It is not sufficient to show that the parties made a bad bargain. In reviewing this "public interest" standard, the court indicated that the Commission should look at factors such as whether the contract impaired the ability of the utility to continue its service, cast upon other consumers an excessive burden, or was unduly discriminatory. The Commission believes that this type of a determination should be made on a case-by-case basis based upon the facts unique to each contract, and that it would be improper to make a broad statement that all existing contracts adversely affect the public interest. Accordingly, the Commission declines to adopt a "fresh look" provision as requested by TCG. TCG also recommends that the Commission address rearrangement charges, those charges applied to a customer to reconfigure services within a central office. TCG believes that it is "crucial that these charges be nondiscriminatory such that there is no difference in the charges to the customer whether the circuits remain as the LEC's circuits or are transferred from an LEC to an interconnector or from an interconnector to an LEC." TCG believes this will give customers freedom of choice. The Commission believes that the issue of rearrangement charges can be addressed in the context of reviewing the LECs' tariffs filed pursuant to this section. However, TCG's comments raise a concern that the rule as drafted could be interpreted to apply to existing contracts between a LEC and its customers. Such an interpretation was not intended by the Commission. Accordingly, the rule has been clarified by adding a new subsection (f) indicating that the rule does not require unbundling or removal of resale prohibitions in customer specific contracts in effect on or before the effective date of this section. All comments, including those not specifically referenced herein, were fully considered by the Commission. The section is adopted under Texas Civil Statutes, Article 1446c, sec.16, which provide the Public Utility Commission of Texas with the authority to make and enforce rules reasonably required in the exercise of its powers and jurisdiction, and sec.18, which provides that the public interest requires that new rules, policies, and principles be formulated and applied to protect the public interest and to provide equal opportunity to all telecommunications utilities in a competitive marketplace. sec.23.92. Expanded Interconnection. (a) Applicability. This section applies to each local exchange carrier, as defined in sec.23.61 of this title (relating to Telephone Utilities), that has interstate tariffs in effect that provide for expanded interconnection with local telephone company facilities. (b) Expanded interconnection for DS1 and DS3 Special Access Services, and Special Access Services for which interstate expanded interconnection has been granted. Each local exchange carrier that is subject to this section shall offer expanded interconnection as specified in this section for the services listed in paragraphs (1)-(3)of this subsection. The LEC shall offer expanded interconnection for these services at the same locations, in the same manner, and, except for price, under the same terms and conditions as it offers expanded interconnection for interstate special access services, unless ordered otherwise by the commission. This subsection applies to the following intrastate special access services: (1) special access DS1; (2) special access DS3; and (3) special access services for which interstate expanded interconnection has been granted. (c) Expanded interconnection for all Special Access and Private Line Services. Each local exchange carrier that is subject to this section shall offer expanded interconnection as specified in this section for the services listed in paragraphs (1)-(2) of this subsection. The LEC shall offer expanded interconnection for these services at the same locations, in the same manner, and, except for price, under the same terms and conditions as it offers expanded interconnection for interstate special access services, unless ordered otherwise by the commission. This subsection applies to the following intrastate services: (1) all private line services, as that term is defined in sec.23.61 of this title (relating to Telephone Utilities); and (2) all special access services. (d) Tariff Provisions. (1) Each local exchange carrier that is subject to this section shall file tariff revisions to unbundle each service for which expanded interconnection shall be offered and to remove any resale or sharing restrictions for each such service. As used in this paragraph, to unbundle means to make available, on an unrestricted basis, the individual rate elements necessary to provide a special access service or a private line service. (2) Each local exchange carrier that is subject to this section shall file tariffs to establish connection charges for the use of equipment and facilities that are associated with offerings of expanded interconnection under this section. Unless ordered otherwise by the commission, the definitions of such connection charges and the regulations governing their application shall be the same as those contained in the carrier's interstate expanded interconnection tariffs. (e) Implementation. All local exchange carriers subject to this section shall file tariff amendments in compliance with subsection (d) of this section. (1) Initial filing to implement subsection (b) of this section. The LEC shall file initial tariff amendments to implement the provisions of subsection (b) of this section not later than 30 days after the effective date of this section. (2) Initial filing to implement subsection (c) of this section. The LEC shall file initial tariff amendments to implement the provisions of subsection (c) of this section not later than 270 days after the effective date of this section. (3) Filings in compliance with this section shall be filed pursuant to sec.23.26 of this title (relating to New and Experimental Services). All tariff amendments filed in compliance with this section shall be filed pursuant to sec.23.26; provided, however, the provisions of sec.23.26(c)(6) shall not apply with respect to rates proposed in compliance with subsection (d)(1) or (2) of this section if the local exchange carrier proposes charges that are the same as the charges in effect for the carrier's interstate provision of the same, equivalent or substitutable service. Tariff revisions filed pursuant to this section shall not be combined in a single application with any other tariff revision. (4) Additional filings. A local exchange carrier shall make, within 15 days of the effective date of an interstate tariff providing for expanded interconnection, such additional tariff filings as are required to remain in compliance with this section. (f) Customer Specific Contracts. This section does not require the unbundling or removal of resale prohibitions in customer specific contracts in effect on or before the effective date of this section. 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 February 1, 1994. TRD-9435513 John M. Renfrow Secretary of the Commission Public Utility Commission of Texas Effective date: March 1, 1994 Proposal publication date: August 3, 1993 For further information, please call: (512) 458-0100 TITLE 22. EXAMINING BOARDS Part XXI. Texas State Board of Examiners of Psychologists Chapter 461. General Rulings 22 TAC sec.461.4 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.461.4, concerning replacement of certificate/license, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8745). The amendment is necessary to bring the rules in line with the new law brought into effect by the 73rd Legislative Session. The amendment will function to conform to the new language of the law, therefore making it uniform and less confusing to the general public. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435444 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.461.5 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.461.5, concerning contents of certificate and license, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8745). The amendment is necessary to have consistency on all documents issued by the Board reflecting an individual's degree status. The amendment will bring consistency to documents issued by the Board for each individual under the jurisdiction of the Board so that there will be no confusion for the general public as to degree status. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435445 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.461.9 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.461.9, concerning subdoctoral licensure, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8745). The amendment is necessary to bring the rules in line with the new law brought into effect by the 73rd Legislative Session. The amendment will conform to the new language of the law, therefore making it uniform and less confusing to the general public. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435446 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 Chapter 463. Applications 22 TAC sec.463.1 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.463.1, concerning qualifications of subdoctoral candidate, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8746). The amendment is necessary to bring the rules in line with the new law brought into effect by the 73rd Legislative Session. The amendment will conform to the new language of the law, therefore making it uniform and less confusing to the general public. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435447 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.463.8 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.463.8, concerning subdoctoral/licensure education requirements, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8746). The amendment is necessary to bring the rules in line with the new law brought into effect by the 73rd Legislative Session. The amendment will conform to the new language of the law, therefore making it uniform and less confusing to the general public. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435448 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.463.9 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.463.9, concerning course work for a subdoctoral licensure, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8746). The amendment is necessary to bring the rules in line with the new law brought into effect by the 73rd Legislative Session. The amendment will conform to the new language of the law, therefore making it uniform and less confusing to the general public. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435449 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.463.10 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.463.10, concerning written examinations required, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8747). The amendment is necessary to bring the rules in line with the new law brought into effect by the 73rd Legislative Session. The amendment will conform to the new language of the law, therefore making it uniform and less confusing to the general public. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435450 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.463.13 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.463.13, concerning failing written/oral examination, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8747). The amendment is necessary to bring the rules in line with the new law brought into effect by the 73rd Legislative Session. The amendment will conform to the new language of the law, therefore making it uniform and less confusing to the general public. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435451 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.463.14 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.463.14, concerning cutoff scores, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8748). The amendment is necessary to bring the rules in line with the new law brought into effect by the 73rd Legislative Session. The amendment will conform to the new language of the law, therefore making it uniform and less confusing to the general public. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435452 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.463.17 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.463.17, concerning foreign graduates, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8748). The amendment is necessary to clarify that the rule applies not only to applicants for Certified Psychologist but also applicants for licensure as a Psychological Associate and to bring the rules in line with current requirements and procedures of the Board. The amendment will clarify the current requirements and policies of the Board concerning applicants who hold degrees from foreign universities thereby helping to ensure the citizens of the State of Texas receive services from qualified professionals. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435453 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.463.20 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.463.20, concerning regionally accredited institutions, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8748). The amendment is necessary to correct an error in the rule so that the proper legal citation is shown. The amendment will conform to the new language of the law, therefore making it uniform and less confusing to the general public. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435454 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.463.28 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.463.28, concerning time limit on exam failures, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8749). The amendment is necessary to clarify the time allowed for applicants to successfully complete all examinations required by the Board The amendment will allow qualified persons to become certified and licensed with a minimum financial burden and ensure that consumers receive quality psychological services from practitioners as soon as possible. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435455 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 Chapter 465. Rules of Practice 22 TAC sec.465.7 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.465.7, concerning status of psychological associates/certified psychologists, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8750). The amendment is necessary to more accurately reflect the Board requirements and standards of the profession. The amendment will put everyone on notice that certified psychologists must also be under supervision to perform psychological services. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435456 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.465.10 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.465.10, concerning applicability of the act and rules of the board, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8751). The amendment is necessary to bring the rules in line with the new law brought into effect by the 73rd Legislative Session. The amendment will conform to the new language of the law, therefore making it uniform and less confusing to the general public. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435457 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.465.16 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.465.16, concerning use of statements regarding services, with changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8751). The amendment is necessary to accurately reflect the Board requirements and standards of the profession. The amendment will put everyone on notice that all individuals certified and licensed by the Board are accountable for statements made regarding psychological services. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. sec.465.16. Use of Statements Regarding Services. A licensed psychologist/licensed psychological associate may not make false, deceptive, or misleading statements regarding any psychological services. 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 January 28, 1994. TRD-9435458 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.465.19 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.465.19, concerning persons with criminal backgrounds, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8751). The amendment is necessary to bring the rules in line with the new law brought into effect by the 73rd Legislative Session. The amendment will conform to the new language of the law, therefore making it uniform and less confusing to the general public. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435459 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.465.36 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.465.36, concerning the ethics code, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8752). The amendment is necessary to conform to the changes in the law brought into effect by the 73rd Legislative Session and to clarify the definition of psychologist as referred to in this rule. The amendment will put everyone on notice that all individuals under the jurisdiction of the Board are accountable to the general public for their professional and scientific activities and their ethical standards, and to conform to the new language of the law, therefore making it unifrom and less confusing to the general public. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435460 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 Chapter 471. Renewals 22 TAC sec.471.1 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.471.1, concerning notification of renewal, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8752). The amendment is necessary to bring the rules in line with the new law brought into effect by the 73rd Legislative Session. The amendment will conform to the new language of the law, therefore making it uniform and less confusing to the general public. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435461 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.471.2 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.471.2, concerning renewal forms, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8752). The amendment is necessary to more accurately reflect the Board requirements and standards of the profession. The amendment will, with the elimination of contracts filed, cut down on paper work required by the Board, thereby reducing expenses and allowing the Board to serve the public in a more cost efficient and timely manner. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435462 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.471.4 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.471.4, concerning guaranteed student loan requirements, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8753). The amendment is necessary to include all student loan programs and to more accurately reflect the Board requirements and standards of the profession. The amendment will require persons to enter a repayment agreement with any student loan guarantor if in default and to file with the Board a certificate from student loan guarantor certifying the repayment agreement. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435463 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 Chapter 473. Fees 22 TAC sec.473.1 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.473.1, concerning application fees, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8753). The amendment is necessary to bring the rules in line with the new law brought into effect by the 73rd Legislative Session. The amendment will conform to the new language of the law, therefore making it uniform and less confusing to the general public. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435464 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 22 TAC sec.473.3 The Texas State Board of Examiners of Psychologists adopts an amendment to sec.473.3, concerning annual renewal fees, without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8753). The amendment is necessary to bring the rules in line with the new law brought into effect by the 73rd Legislative Session. The amendment will conform to the new language of the law, therefore making it uniform and less confusing to the general public. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 4512c, which provide the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. 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 January 28, 1994. TRD-9435465 Rebecca E. Forkner Acting Executive Director Texas State Board of Examiners of Psychologists Effective date: February 21, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 835-2036 TITLE 25. HEALTH SERVICES Part I. Texas Department of Health Chapter 13. Health Planning and Resource Development Data Collection 25 TAC sec.sec.13.11-13.17 The Texas Department of Health (department) adopts the repeal of sec.sec.13.11-13.17 and new sec.sec.13.11-13.20, concerning the collection, reporting and dissemination of data from hospitals. Sections 13.12, 13.15, and 13.17 are adopted with changes to the proposed text as published in the November 9, 1993, issue of the Texas Register (18 TexReg 8099). Sections 13.11, 13.13, 13.14, 13. 16 and 13.18-13.20 are adopted without changes and will not be republished. The new sections define terms commonly used in the data collection process, identify the types of data to be reported by hospitals, establish standards for the provision of charity care and associated reporting requriements for non- profit hospitals, describe sanctions for non-compliance, and establish procedures for access to data. The existing rules are repealed and are replaced by the new rules. The following is a list of comments received relating to the proposed sections. COMMENT: One commenter expressed concern that the preamble to the rules did not accurately reflect the impact of the rules on hospital recordkeeping activities, specifically in regard to sec.sec.13.13, 13.15(a), 13.16, 13.17(a) and 13.17(b). RESPONSE: The department agrees that sec.sec.13.17(a) and 13.17(b) do specify new reporting requirements for non-profit hospitals which will have inherent costs. However, sec.sec.13.13, 13.15 and 13.16 refer to slight modifications to activities already in place in hospitals. COMMENT: Regarding sec.13.13, one commenter expressed concern that the definitions for medically indigent, charity care, and education-related costs were inadequate. RESPONSE: The department disagrees as the subsections adhere to statutory definitions which cannot address the wide range of specific circumstances inherent in the interpretation of these definitions. COMMENT: Concerning sec.13.14(5)(A)-(D), one commenter mentioned that the information requested under this section was duplicated in sec.13.17(a). RESPONSE: The department concludes that these sections are not duplicative. Section 13.14(5)(A)-(D) specifies community benefits reporting requirements for all hospitals. Section 13.17(a) specifies responsibilities for non-profit hospitals in developing a report of their annual community benefits plan. COMMENT: Regarding sec.13.15(d), one commenter expressed concern that the shortened reporting period for disproportionate share hospitals was punitive. RESPONSE: The department agrees and has removed that subsection from the new rules. COMMENT: Concerning sec.13.17(b)(1), one comment made was that it was not clear that a hospital is not obligated to choose the same community benefits standard each year. REPONSE: The department concludes that the current wording is adequate and does not restrict hospitals from this practice. COMMENT: Regarding sec.13.17(d), one commenter expressed concern that the rules do not specify the availability date of the first report of the community benefits plans required for submission by non-profit hospitals. RESPONSE: The department concludes that this information should be integrated into the public notices prepared by each non-profit hospital since the availability date varies by individual facility. The section was revised to incorporate this information requirement into the public notices. COMMENT: Concerning sec.13.19(a) and (b), one commenter felt that mechanisms established to maintain the confidentiality of information are too vague. RESPONSE: The department agrees that these mechanisms are not specific at this point in time. However, none of the data collection and reporting requirements specified in the rules involve confidential data. More detailed controls will be developed, as necessary. One minor editorial change was made for clarification purposes. The Methodist Hospital System and Texas Children's Hospital submitted comments. The commenters were in support of the sections, but they had concerns, recommendations, and questions as previously discussed. The repeals are authorized under the Health and Safety Code, Chapters 104 and 311. Chapter 104 mandates the collection and dissemination of data from health care facilities necessary to facilitate health planning and resource development. Chapter 311 authorizes the collection and reporting of financial, utilization, and patient discharge data to determine the impact of the provision of indigent care on hospitals in the state and to assess the adequacy of the provision of community service provided by nonprofit hospitals. Sections 104.024(a) and 311.032(b) provide the Board of Health with the authority to adopt rules for the performance of every duty inposed by law on the Texas Board of Health, the Texas Department of Health, and the Commissioner of Health. 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 February 2, 1994. TRD-9435562 Susan K. Steeg General Counsel Texas Department of Health Effective date: February 23, 1994 Proposal publication date: November 9, 1993 For further information, please call: (512) 458-7261 Data Collection 25 TAC sec.sec.13.11-13.20 The new sections are authorized under the Health and Safety Code, Chapters 104 and 311. Chapter 104 mandates the collection and dissemination of data from health care facilities necessary to facilitate health planning and resource development. Chapter 311 authorizes the collection and reporting of financial, utilization, and patient discharge data to determine the impact of the provision of indigent care on hospitals in the state and to assess the adequacy of the provison of community service provided by nonprofit hospitals. Sections 104.024(a) and 311.032(b) provide the Board of Health with the authority to adopt rules for the performance of every duty imposed by law on the Texas Board of Health, the Texas Department of Health, and the Commissioner of Health. sec.13.11 Purpose. The purpose of the sections in this chapter is to implement Health and Safety Code, Chapter 104, Subchapter D, which requires the department to adopt rules covering the collection of data from health care facilities, such as hospitals, and the dissemination of data to facilitate health planning and resource development; Health and Safety Code, Chapter 311, Subchapter C, which requires the department to adopt rules covering the collection and reporting of hospital financial, utilization and patient discharge data including data regarding the provision of levels of charity care by certain nonprofit hospitals, and the submission of a community benefits plan by certain nonprofit hospitals. sec.sec.13.12. Scope. The scope of these sections is to describe the criteria and procedures which the department will use in implementing data collection, dissemination and reporting requirements. These sections will cover the collection and dissemination of data from the public or private hospitals that are included in the definition of the term "health care facilities" in the Health and Safety Code, Chapter 104, Subchapter A. The remaining entities included in the definition of the term "health care facilities" are not covered by these sections. If data covered by these sections will be collected from a public or private hospital that is a general or special hospital licensed under the Health and Safety Code, Chapter 241; a private mental hospital licensed under the Health and Safety Code, Chapter 577; or a treatment facility licensed under the Health and Safety Code, Chapter 464, the data will be collected under authority of and in compliance with the requirements of the Health and Safety Code, Chapters 104 and 311. sec.13.13. Definitions. The following words and terms shall have the following meanings unless the context clearly indicates otherwise. Board-The Texas Board of Health. Chapter 104-Provisions relating to the data collection responsibilities of the Texas Department of Health as the State Health Planning and Development Agency found within Title 2 of the Health and Safety Code. Chapter 311-Provisions relating to the Powers and Duties of Hospitals found within Title 4 of the Health and Safety Code. Charity care-The unreimbursed cost to a hospital of providing, funding, or otherwise financially supporting health care services on an inpatient or outpatient basis to a person classified by the hospital as financially or medically indigent and/or providing, funding or otherwise financially supporting health care services provided to financially indigent patients through other nonprofit or public outpatient clinics, hospitals or health care organizations. Community benefits -The unreimbursed cost to a hospital of providing charity care, government-sponsored indigent health care, donations, education, government-sponsored program services, research and subsidized health services. Community benefits do not include the cost to the hospital of paying any taxes or other governmental assessments. Department-The Texas Department of Health. Donations-The unreimbursed costs of providing cash and in-kind services and gifts, including facilities, equipment, personnel, and programs, to other nonprofit or public outpatient clinics, hospitals, or health care organizations. Education-related cost -The unreimbursed cost to a hospital of providing, funding or otherwise financially supporting educational benefits, services and programs including education of medical professionals and health care providers; scholarships and funding to medical schools, colleges and universities for health professions education; education of patients concerning diseases and home care in response to community needs; and community health education through informational programs, publications and outreach activities in response to community needs. Financially indigent -An uninsured or underinsured person who is accepted for care with no obligation or a discounted obligation to pay for the services rendered based on the hospital's eligibility system. Government sponsored indigent health care-The unreimbursed cost to a hospital of providing health care services to recipients of Medicaid and other federal, state, or local indigent health care programs, eligibility for which is based on financial need. Health care facility-Regardless of ownership, a public or private hospital, skilled nursing facility, intermediate care facility, ambulatory surgical facility, family planning clinic which performs ambulatory surgical procedures, rural health initiative clinic, urban health initiative clinic, kidney disease treatment facility, inpatient rehabilitation facility, and other facilities as defined by federal law, but does not include the office of physicians or practitioners of the healing arts singly or in groups in the conduct of their profession. Hospital-A general or special hospital licensed under the Health and Safety Code, Chapter 241; a private mental hospital licensed under the Health and Safety Code, Chapter 577; and a treatment facility licensed under the Health and Safety Code, Chapter 464. Hospital eligibility system-The financial criteria and procedure used by a hospital to determine if a patient is eligible for charity care. The system shall include income levels and means testing indexed to the federal poverty guidelines; provided, however, that a hospital may not establish an eligibility system which sets the income level eligible for charity care lower than that required by counties under sec.61.023 or higher, in the case of the financially indigent, than 200 percent of the federal poverty guidelines. A hospital may determine that a person is financially or medically indigent pursuant to the hospital's eligibility system after health care services are provided. Hospital Data Advisory Committee-An advisory Board, which assists the department in carrying out its responsibilities under Health and Safety Code, Chapter 311. Medically indigent -A person whose medical or hospital bills after payment by third-party payors exceed a specified percentage of the patient's annual gross income, determined in accordance with the hospital's eligibility system, and the person is financially unable to pay the remaining bill. Nonprofit hospital -A hospital that is eligible for tax-exempt bond financing; or exempt from state franchise, sales ad valorem, or other state or local taxes; and organized as a nonprofit corporation or a charitable trust under the laws of this state or any other state or country. For purposes of these sections, a "nonprofit hospital" shall not include a hospital that: (A) is exempt from state franchise, sales, ad valorem, or other state or local taxes; (B) does not receive payment for providing health care services to any inpatients or outpatients from any source including but not limited to the patient or any person legally obligated to support the patient, third-party payors, Medicare, Medicaid, or any other federal, state, or local indigent care program; payment for providing health care services does not include charitable donations, legacies, bequests, or grants or payments for research; and (C) does not discriminate on the basis of inability to pay, race, color, creed, religion, or gender in its provision of services; or (D) is located in a county with a population under 50,000 where the entire county or the population of the entire county has been designated as a Health Professional Shortage Area. Patient data-Information derived from individual, acute care, inpatient and outpatient discharge abstract records. Subsidized health services-Services provided by a hospital in response to community needs for which the reimbursement is less than the hospital's cost for providing the services and which must be subsidized by other hospital or nonprofit supporting entity revenue sources. Subsidized health services include, but are not limited to, emergency and trauma care, neonatal intensive care, free-standing community clinics and collaborative efforts with local government or private agencies in preventive medicine. Survey-The annual data collection effort conducted by the department to implement the provisions of Health and Safety Code, Chapters 104 and 311. sec.13.14. Types of Data to be Reported. The types of data which hospitals must report to the Texas Department of Health (department) are as follows: (1) reporting period data reflecting the 12-month period covering the hospital's most recently completed fiscal year; (2) organizational structure data reflecting the organization that is responsible for establishing policy for the overall operation of the hospital; the organization that owns the hospital's physical plant; the organization's affiliation with the hospital and any hospital systems of which the hospital is a part; and, the type of service provided to the majority of admissions; (3) financial data about a facility's revenues and expenses. Financial data is based on the American Institute of Certified Public Accountants Hospital Audit Guide and on generally accepted accounting principles for hospitals and is extracted from the hospital's most recent annual financial statements as follows: (A) total gross revenue, including Medicare and Medicaid gross revenue, other revenue from state programs, revenue from local government programs, local tax support, charitable contributions, other third party payments, gross inpatient revenue and gross outpatient revenue; (B) total deductions from gross revenue, including contractual allowances and any other deductions; (C) net patient revenue; (D) charity care; (E) bad debt expense; and (F) total assets and liabilities; (4) utilization data about the use of a facility and/or its services, including: (A) total admissions, including Medicare admissions and Medicaid admissions, admissions under a local government program, charity care admissions and any other type of admission; (B) total discharges; (C) total patient days; (D) average length of stay; and (E) total outpatient visits; and (5) additional data as follows: (A) estimates of unreimbursed costs of subsidized health services reported separately as emergency and trauma care, neonatal intensive care, free-standing community clinics, collaborative efforts with local government or private agencies in preventive medicine, and other subsidized health services; (B) donations; (C) total cost of reimbursed and unreimbursed research; and (D) total cost of reimbursed and unreimbursed education separated into the following categories: education of physicians, nurses, technicians, and other medical professionals and health care providers; scholarships and funding to medical schools, colleges, and universities for health professions education; education of patients concerning diseases and home care in response to community needs; community health education through informational programs, publications, and outreach activities in response to community needs; and other educational services that satisfy the definition of "education-related costs" under Health and Safety Code, sec.311.031 (6) . sec.13.15. Survey Forms. (a) The hospital shall use the survey form developed by the Texas Department of Health (department) for reporting purposes. The department shall mail a survey form to each hospital on an annual basis. (b) The hospitals shall complete all requested sections on the survey form and return it to the department within 60 days of receipt. The hospitals shall report data for the hospitals' most recently completed fiscal year. A copy of the hospital's eligibility system shall be submitted as an attachment to the survey form. (c) The department may request missing or incomplete data by written or telephone request. Hospitals shall complete all requested follow-up in the time frame specified by the department. sec.13.16. Verification Report. The department shall send each reporting hospital a copy of its data verification report prior to the publication of the results of the survey. The hospital shall review the contents of the computer generated report. If modifications to the report are necessary, the appropriate changes shall be made on the report, and the hospital administrator shall sign and return the report to the department within 31 days of receipt. If no changes are reported within 31 days, the department shall consider the hospital's report verified. sec.13.17. Duties of Nonprofit Hospitals. (a) Annual Community Benefits Plan. (1) Nonprofit hospitals shall file an annual report of the community benefits plan, as required by Health and Safety Code, sec.311.046, with the Texas Department of Health (department) no later than 120 days after the end of the hospital's first complete fiscal year beginning after September 1, 1993. (2) The nonprofit hospital's annual report of the community benefits plan must include, at a minimum, the hospital's mission statement, a disclosure of the health care needs of the community that were considered in developing the community benefits plan and a disclosure of the amount and types of community benefits, including charity care, actually provided. Charity care shall be reported as a separate item from other community benefits. (b) Annual Statement of Community Benefits Standard. (1) Nonprofit hospitals shall file an annual statement with the department no later than 120 days after the end of the hospital's fiscal year, stating which of the standards for providing community benefits have been satisfied. The annual statement filed by a hospital under this subsection shall be based on the most recetly completed and audited prior fiscal year of the hospital. A nonprofit hospital may elect to provide community benefits according to any of the following standards: (A) charity care and government-sponsored indigent health care are provided at a level which is reasonable in relation to the community needs, as determined through the community needs assessment, the available resources of the hospital, and the tax- exempt benefits received by the hospital; (B) charity care and government-sponsored indigent health care are provided in an amount equal to at least four percent of the hospital's net patient revenue; (C) charity care and government-sponsored indigent health care are provided in an amount equal to at least 100 percent of the hospital's tax-exempt benefits, excluding federal income tax; (D) prior to January 1, 1996, charity care and community benefits are provided in a combined amount equal to at least five percent of the hospital's net patient revenue, provided that charity care and government-sponsored indigent health care are provided in an amount equal to at least three percent of net patient revenue; or (E) after December 31, 1995, charity care and community benefits are provided in a combined amount equal to at least five percent of the hospital's net patient revenue, provided that charity care and government-sponsored indigent health care are provided in an amount equal to at least four percent of net patient revenue. (2) Nonprofit hospitals shall use the form developed by the department for reporting under this section and shall submit the form as part of the annual community benefits plan. (3) The department will accept written revisions of the Annual Statement of Community Benefits Standard for 30 days after the filing date. (c) Reporting. (1) The department shall notify nonprofit hospitals in writing that the annual report of a community benefits plan and the statement of community benefits standard must be filed within 120 days after the end of the hospital's fiscal year. The notification will include a form to be used by nonprofit hospitals to file the Annual Statement of Community Benefits Standard. (2) The department shall determine each nonprofit hospital's filing date based on the fiscal year reporting period used in its 1992 survey form required under sec.13.15 of this title (relating to Survey Forms). A nonprofit hospital may change its filing date by providing written notification to the department at the initiation of a new fiscal year reporting basis. (d) Posting of sign. Nonprofit hospitals shall prepare a statement notifying the public that the annual report of the community benefits plan is public information, that it is filed with the department and that it is available on request from the Bureau of State Health Data and Policy Analysis, Texas Department of Health, 1100 West 49th Street, Austin, Texas 78756. The statement must indicate the report's availability date and be posted in prominent places throughout the hospital, including but not limited to the waiting areas of the emergency room and the admissions office. Nonprofit hospitals shall also print the statement in the patient guide or other materials that provide the patient with information about the hospital's admissions criteria. sec.13.18. Non-Compliance with Reporting Requirements. (a) Data Reporting. (1) A hospital that does not timely submit requested data to the Texas Department of Health (department) according to the requirements and procedures established in these sections is subject to a civil penalty of not more than $500 for each day of non-compliance, under the provisions of Health and Safety Code, Chapter 104. (2) If a hospital does not submit a completed survey form to the department within the 60-day reporting period established in sec.13.15 of this title (relating to Survey Forms), the department may institute the following procedures. (A) The department will notify the entity in writing by certified mail, return receipt requested, that the entity is in non-compliance with department reporting requirements and may be in violation of Health and Safety Code, Chapter 104. The written notification will also state that the commissioner of health will request that the attorney general institute and conduct a suit in the name of the state to recover civil penalties if the hospital fails to submit the requested data to the department within 30 days of the postmark of the notification letter. (B) If the department does not receive the requested data from the non- responding hospital within the specified time frame, the commissioner of health will notify the attorney general in writing of the entity's non-compliance. The department will send a copy of the written notification to the hospital. (b) Community Benefits Plans. (1) A nonprofit hospital that does not timely submit a report of the community benefits plan to the Texas Department of Health (department) according to the requirements and procedures established in these sections is subject to a civil penalty of not more than $1,000 for each day of non-compliance, under the provisions of Health and Safety Code, Chapter 311. (2) If a nonprofit hospital does not submit a report of the community benefits plan to the department within the 120-day reporting period established in sec.13.17 of this title (relating to Duties of Nonprofit Hospitals), the department may institute the following procedures. (A) The department will notify the entity in writing by certified mail, return receipt requested, that the entity is in non-compliance with department reporting requirements and may be in violation of Health and Safety Code, Chapter 311. The written notification will also state that the commissioner of health will request that the attorney general institute and conduct a suit in the name of the state to recover civil penalties if the hospital fails to submit the report to the department within ten days after receipt of the written notification letter. (B) If the department does not receive the report of the community benefits plan from the non-responding hospital within the specified time frame, the commissioner of health will notify the attorney general in writing of the entity's non-compliance. The department will send a copy of the written notification to the hospital. sec.13.19. Confidential Data. (a) The following data received by the Texas Department of Health (department) from a public or private hospital is confidential under authority of Health and Safety Code, Chapters 104 and 311: (1) information relating to a specific patient; and (2) financial information relating to a provider or hospital that was submitted prior to September 1, 1987. All financial data regarding a provider or facility submitted after September 1, 1987, are no longer confidential. (b) The department will establish appropriate internal controls to maintain confidentiality. (c) The department will disclose confidential patient information to a third party only upon receipt of appropriate written consent of the patient. sec.13.20. Open Records Request Procedures. (a) The Texas Department of Health (department) will provide non-confidential information upon receipt of written request and payment for the cost of copies as determined by the department and the General Services Commission. (b) Individuals may review non-confidential information on the department's premises during normal business hours by scheduling an appointment at least one day in advance of the desired review. Individuals must complete their review of the information within ten days or submit a written request to the department to obtain additional time to review the information. (c) The department will notify the requester in writing if the requested information is unavailable at the time of the request and establish a date within a reasonable period of time in which the information will be available for inspection or duplication. 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 February 2, 1994. TRD-9435561 Susan K. Steeg General Counsel TExas Department of Health Effective date: February 23, 1994 Proposal publication date: November 9, 1993 For further information, please call: (512) 458-7261 Chapter 169. Veterinary Public Health Meat and Poultry Inspection 25 TAC sec.169.12 The Texas Department of Health (department) adopts an amendment to sec.169.12, concerning meat and poultry inspection, without changes to the proposed text as published in the November 9, 1993, issue of the Texas Register (18 TexReg 8112). The section covers definitions and grants of inspection and/or custom exemption. The amendment deletes the definition for custom slaughtering and custom processing, adds a new definition for custom operations, and expands the species to be included in the requirement for a grant of custom exemption to include all species amenable to inspection by the Texas Meat and Poultry Inspection Act. The new definition implements House Bill 395, 73rd Legislature, Regular Session, which amends Health and Safety Code, sec.433.024. This amendment is adopted to further protect public health by requiring facilities used for slaughtering and/or processing animals purchased for slaughter and/or processing on the seller's premise meet minimal construction and sanitation standards and by requiring all species of animals custom slaughtered or processed for food to be slaughtered by persons whose facilities have met minimum standards and who have obtained a grant of custom exemption. No comments were received on the amendment as proposed. The amendments are adopted under the Health and Safety Code, sec.433.008, which provides the commissioner authority to adopt rules for the efficient execution of the Texas Meat and Poultry Act; and sec.12.001, which provides the Texas Board of Health with the authority to adopt rules for the performance of every duty imposed by law on the Texas Board of Health the Texas Department of Health, and the Commissioner of Health. 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 February 2, 1994. TRD-9435555 Susan K. Steeg General Counsel Texas Department of Health Effective date: February 23, 1994 Proposal publication date: November 9, 1993 For further information, please call: (512) 458-7443 Chapter 229. Food and Drug Issuance of Certificates of Free Sale and Certificates of Origin 25 TAC sec.sec.229.301-229.304 The Texas Department of Health (department) adopts new sec.sec.229.301- 229.304 with changes to the proposed text as published in the November 9, 1993, issue of the Texas Register (18 TexReg 8113). These new sections will help the department cover the program costs by enabling assessment of fees for the issuance of Certificates of Free Sale and Certificates of Origin. The rule will enable the department to dedicate personnel for inspection, approval, and issuance of the certificates resulting in more expedient service to the industry. The following comments were received regarding the proposed sections. COMMENT: Concerning sec.229.302, a commenter recommended that the final clause in the definition of "Certificate of Free Sale" be changed to read "... that the products can be sold freely to the public in the United States of America." RESPONSE: The department agrees and has revised the definition. COMMENT: Concerning sec.229.302, a commenter suggested that the definition of "Certificate of Origin" be defined independently of a "Certificate of Free Sale" and should only certify that the products originate from the United States of America. RESPONSE: The department agrees and the appropriate language has been added. COMMENT: Concerning sec.229.302, a commenter recommended that the time for inspection of facilities as stated in the definition of "Current Inspection" be increased from 12 months to 24 months. RESPONSE: The department disagrees and feels that an accurate assessment of conditions must be made at least every 12 months to ensure protection of the public. No changes were made as a result of the comment. Minor editorial changes were made for clarification purposes. The commenter was Mary Kay Cosmetics, Inc. The commenter was generally in favor of the rules but expressed concerns, questions, and recommendations. The sections are adopted under the Health and Safety Code, sec.431.241, which provides the department with the authority to adopt necessary regulations pursuant to the enforcement of this Chapter; and sec.12.001, which provides the Texas Board of Health with the authority to adopt rules for the performance of every duty imposed by law on the Texas Board of Health, the Texas Department of Health, and the Commissioner of Health. sec.229.301. Purpose. These sections enable the Texas Department of Health to assess fees for the issuance of Certificates of Free Sale and Certificates of Origin. sec.229.302. Definitions. The following words and terms, when used in these sections, shall have the following meanings unless the context clearly indicates otherwise. Certificate of Free Sale-A notarized document issued by the Texas Department of Health which certifies that the manufacturer and/or distributor of the food, drugs, cosmetics, or medical device products listed in the document is duly authorized to manufacture, operate, or distribute the products and that the products can be sold freely to the public in the United States of America. Certificate of Origin-A notarized document issued by the Texas Department of Health which certifies that the products listed in the document originate from the United States of America. Current Inspection -An inspection of a firm conducted by the Division of Food and Drugs within the 12 months immediately preceding a request for Certificate of Free Sale and/or Certificate of Origin. Currently Licensed -Firms regulated by the Texas Department of Health under the Health and Safety Code (Texas Food, Drug, and Cosmetic Act) which possess a current, valid license. sec.229.303. Certificate Fees and Procedures. (a) Certificate fee. All manufacturers of foods, drugs, cosmetics, or medical devices; wholesalers/distributors of foods or cosmetics; or wholesale distributors of drugs or devices who request Certificates of Free Sale and/or Origin shall pay fees as follows: (1) $25 for the first original certificate and $10 for each additional identical original certificate. The $25 fee will entitle the requestor to a maximum of 10 products; (2) an additional fee of $10 for each additional page of products exceeding the first 10 products. Each additional page shall be limited to 50 products; (3) the same fee for photocopies of the original certificate as established by the State Purchasing and General Services Commission under the Texas Open Records Act for copies of readily available information shall apply; (4) the same hourly fee for research and review as established by the State Purchasing and General Services Commission under the Texas Open Records Act for the labor performed by professional staff for copies of information not readily available shall apply; and (5) $250 for each establishment not required to be licensed by the Texas Department of Health (department) under the Health and Safety Code that requires an inspection prior to the issuance of any certificate. (b) Application forms. Application forms may be obtained from the Division of Food and Drugs, Texas Department of Health, 1100 West 49th Street, Austin, Texas 78756-3182. (c) Application statement. The application statement shall be signed, shall be made on an application form furnished by the department, and shall contain the following information: (1) the name under which the business is conducted; (2) the address where the business is conducted; (3) the type of operation conducted by the requesting firm; (4) the type of certificate required; and (5) a list of products to be on the certificate. (d) Pre-certificate inspection. The applicant shall cooperate with any pre- certificate inspection deemed necessary by the department. sec.229.304. Minimum Requirements to Receive a Certificate. (a) All firms required to be licensed by the Texas Department of Health under the Health and Safety Code, Chapter 431, Subchapter K (Code) shall be currently licensed and shall be in substantial compliance with the Code and regulations as they apply to each specific type of operation. (b) All firms shall have a current inspection and shall be deemed in substantial compliance with the Code and these sections. (c) A Certificate of Free Sale or Certificate of Origin shall not be issued if violations exist involving potential health hazards or labeling violations of foods, drugs, medical devices, or cosmetics. 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 February 2, 1994. TRD-9435565 Susan K. Steeg General Counsel Texas Department of Health Effective date: February 23, 1994 Proposal publication date: November 9, 1993 For further information, please call: (512) 458-7248 Tanning Facilities The Texas Department of Health (department) adopts the repeal of existing sec.sec.229.341-229.349 and new sec.sec.229.341-229.357, concerning the tanning facility permitting standards. New sec.sec.229.342, 229.343, 229.345, 229.347- 229. 349, 229.351, 229.353-229.355, and 229.357 are adopted with changes to the proposed text as published in the November 9, 1993, issue of the Texas Register (18 TexReg 8114). The repeal of sec.sec.229.341-229.349 and new sec.sec.229.341, 229.344, 229.346, 229.350, 229.352, and 229.356 are adopted without changes and will not be republished. The purpose of the sections is to update and clarify the tanning facility permitting standards to correct previous misunderstandings as they relate to the requirements of tanning devices and to further clarify the relationship that exists between these sections and the enforcement provisions of the Texas Food, Drug, and Cosmetic Act, Health and Safety Code, Chapter 431. The new sections will help the department better enforce existing requirements and prevent serious injury to consumers from the use of misbranded and adulterated tanning devices. The following comments were received regarding the proposed sections. COMMENT: Concerning sec.229.342(e), a commenter objected to the words "on the date specified" as not being clear with respect to references to federal regulations. RESPONSE: The department disagrees and believes no further clarification is required since the dates specified are found in parentheses following references to federal regulations. COMMENT: Concerning sec.229.343, a commenter recommended the word "and" be substituted for the word "or" wherever mentioned in the definition of "operator" to prevent the owner from escaping responsibility for the facility. RESPONSE: The department feels the definition as stated is adequate to ensure that responsibility for the facility operations belongs to the facility operator. No change was made as a result of the comment. COMMENT: Concerning sec.229.343, a commenter suggested adding the phrase "or the use of" following the word "access" in defining the term "tanning facility". RESPONSE: The department disagrees and believes the additional words are redundant. COMMENT: Concerning sec.229.343, a commenter suggested the term "reconditioned" be defined. RESPONSE: The department agrees and the definition has been added. COMMENT: Concerning sec.229.343, a commenter recommended that the terms "reconditioned", "remanufactured", and "recertified" be defined in the rules for clarification. RESPONSE: The department agrees to add a definition for "reconditioning", however disagrees it is necessary to define the terms "remanufactured" and "recertified" since these terms are not referenced in the rules. COMMENT: Concerning sec.229.344(b), a commenter objected to the wording regarding personal use of tanning devices, stating that it allows use of a tanning device by a neighbor or friend. RESPONSE: The department disagrees and believes the wording is adequate to restrict personal use only to the device owner. COMMENT: Concerning sec.229.345(c), a commenter suggested additional clarification was needed to identify which tanning facilities must apply for a permit on the effective date of the rules. RESPONSE: The department disagrees and believes the rule can be interpreted accurately as stated. COMMENT: Concerning sec.229.345(d), a commenter questioned the purpose of permits expiring one year from the date of issuance. RESPONSE: The department believes that permits expiring one year from the date of issuance will allow for more efficient processing of permit applications and renewals. COMMENT: Concerning sec.229.345(h)(2), a commenter objected to a corporation having to provide a copy of its articles of incorporation with its permit application. RESPONSE: The department believes this requirement does not place an undue burden on the facility and provides the Department with necessary ownership information which is needed to adequately inform the facility management of deficiencies or potential enforcement action. COMMENT: Concerning sec.229.345(h)(3), a commenter asked why a drivers license was required information on a permit application. RESPONSE: The department believes a drivers license number is an appropriate and customary proof of identification when used in validating ownership information for a facility permit. COMMENT: Concerning sec.229.345(h)(5), a commenter suggested that the identity of the tanning device, to include brand and model numbers, be added to the information required in a permit application. RESPONSE: Manufacturer, brand name, and model number for all tanning devices is currently required information in the permit application as stated in sec.229.345(h)(5). COMMENT: Concerning sec.229.345(h)(8)-(9), a commenter suggested changing references to "consumer" in these sections to "customer". RESPONSE: The department disagrees since the term "consumer" more adequately reflects the scope of these sections in that a tanning facility is defined as providing persons "access" to tanning devices and does not require compensation. COMMENT: Concerning sec.229.345(h)(8), a commenter questioned the meaning of "title" in reference to sec.229.354 (relating to Records). RESPONSE: The use of the term "title" is in reference to Title 25 of the Texas Administrative Code. COMMENT: Concerning sec.229.345(h)(8), a commenter noted that the term "guardian" in this section is referenced elsewhere in the rules as "legal guardian". RESPONSE: The department agrees and has made the appropriate change. COMMENT: Concerning sec.229.345(h)(9)(E), a commenter suggested that procedures for weekly testing of tanning device timers be established by the operator instead of procedures for periodic testing as required. RESPONSE: The department disagrees since operators must develop maintenance and testing procedures for their tanning devices in conjunction with manufacturer recommendations. Manufacturers may vary on their recommendations for maintenance and testing schedules. COMMENT: Concerning sec.229.345(h)(9)(E), a commenter stated that tanning devices require no testing and therefore objected to the requirement for operator procedures which address the periodic testing of tanning devices and timers. RESPONSE: The department disagrees since tanning devices are considered medical devices and are radiation-emitting electronic products which require routine maintenance and testing to ensure safe and effective use by consumers. COMMENT: Concerning sec.229.346(c), a commenter questioned whether a facility should be assessed a delinquency fee if the delinquency was not the fault of the facility. RESPONSE: The tanning facility operator is responsible for maintaining a valid permit while in business. A delinquent permit is not recognized by the department as a valid instrument and therefore delinquency fees are assessed accordingly. COMMENT: Concerning sec.229.347(d)(3), a commenter inquired as to why 5.0% was used as a minimum standard for determining whether a stock transfer resulted in a change of ownership. RESPONSE: The minimum stock transfer standards used for identification of corporate ownership changes are adapted from similar standards set by the United States Securities and Exchange Commission. COMMENT: Concerning sec.229.348, a commenter asked whether a change in tanning devices would require a report of change on the part of the operator. RESPONSE: A change in tanning devices would require the tanning facility operator to submit a report of change to the department within ten days of the change. COMMENT: Concerning sec.229.350, a commenter stated that the warning signs should be more easily readable and the dimensions of the signs should be reduced to 11 inches wide by 17 inches high. RESPONSE: The department disagrees since the content and dimensions of all required warning signs are specified in the Statute. COMMENT: Concerning sec.229.350(a), a commenter suggested that the dimensions for warning signs in public areas be reduced to no larger than 24 inches by 24 inches. RESPONSE: The department disagrees since the dimensions of warning signs are specified in the Statute. COMMENT: Concerning sec.229.351(a), a commenter stated that the term "reconditioned" as used in this section is not defined in the rules. RESPONSE: The department agrees and has added the definition to sec.229.343. COMMENT: Concerning sec.229.351(a), a commenter suggested restructuring the section for clarification. RESPONSE: The department believes the section can be adequately interpreted as stated and no change was made as a result of the comment. COMMENT: Concerning sec.229.351(a), a commenter suggested that it would be less confusing if state requirements were not referenced at all in this section. RESPONSE: The department disagrees since the reference to state requirements in this section is to reconditioning of medical devices. The reconditioning of medical devices, including tanning devices, is regulated by state statutes and therefore deserves reference. COMMENT: Concerning sec.229.351(b), a commenter objected to the requirement that a timer interval must meet accuracy criteria. RESPONSE: The department disagrees since federal requirements in 21 Code of Federal Regulations, sec.1040.20 specifically reference acceptable limits for timer interval accuracy. COMMENT: Concerning sec.229.351(d), two commenters objected to the wording of this section in reference to remote timers, indicating that it might promote the unauthorized manufacturing of tanning devices. RESPONSE: The department agrees and has made the appropriate change. COMMENT: Concerning sec.229.351(e), a commenter asked if token timers were exempted from sec.229.351(d). RESPONSE: Token timers are timer systems and are not exempt from the requirements of sec.229.351. COMMENT: Concerning sec.229.351(f), a commenter suggested the section be clarified since internal operating temperatures of tanning devices sometimes exceed the 100 degrees Fahrenheit limit and are considered in compliance with the United States Food and Drug Administration requirements. RESPONSE: The department agrees and has provided additional clarification. COMMENT: Concerning sec.229.351(g), a commenter suggested changing the word "consumer" to "tanning device user" in referencing the requirement for physical barriers to protect against lamp contact or breakage. RESPONSE: The Department disagrees and believes the term "consumer" is a more appropriate and accepted term with respect to safety issues involving consumer protection. COMMENT: Concerning sec.229.351(g), a commenter asked about the definition of "physical barriers" in reference to protection against lamp contact and breakage. RESPONSE: The department believes that the term "physical barriers" need not be defined since the broad scope of "barriers" is dictated by the preemptive language of federal requirements associated with the tanning device approval process. COMMENT: Concerning sec.229.351(g), a commenter suggested that tanning devices with wire mesh barriers for protection against lamp contact or breakage are not acceptable yet meet U.S. Food and Drug Administration requirements. RESPONSE: The department disagrees since the materials and design features of physical barriers are subject to evaluation by the United States Food and Drug Administration and may vary between tanning device manufacturers. COMMENT: Concerning sec.229.351(i), a commenter asked whether filters should be included in reference to standards for replacement of lamps and filters in tanning devices. RESPONSE: The section refers to replacement of both lamps and filters and specifies that both shall be of a type intended for the device as specified in the device labeling or equivalent. COMMENT: Concerning sec.229.351(i), a commenter asked whether the section addressed original or replacement lamps. RESPONSE: The section is designed to address the issue of lamp replacement in a tanning device and requires the operator to install only lamps designated by the manufacturer or an equivalent as determined by the United States Food and Drug Administration. COMMENT: Concerning sec.229.351(j), a commenter objected to this section as unnecessary, stating that local electrical codes are sufficient to regulate the installation and maintenance of tanning devices. RESPONSE: The department disagrees since the possibility exists that tanning facilities may be located outside local jurisdictions or that existing local codes may not be consistent with state regulations pertaining to electrical installations. COMMENT: Concerning sec.229.351(l), a commenter objected to the inclusion of additional requirements for stand-up booths which may conflict with standards acceptable to the United States Food and Drug Administration. RESPONSE: The department disagrees since the additional requirements for stand- up booths are general safety and efficacy criteria commonly used to evaluate these types of tanning devices by the United States Food and Drug Administration. COMMENT: Concerning sec.229.352, a commenter recommended adding the statement "A tanning customer shall not be required by a facility to purchase protective eyewear as a prerequisite to use the facility's tanning devices." RESPONSE: The department disagrees since the statute does not specifically prevent a tanning facility from charging a fee for use of protective eyewear. COMMENT: Concerning sec.229.353(b), a commenter suggested this section should be changed so that training requirements are separated from the knowledge required to operate a tanning facility. RESPONSE: The department disagrees since the knowledge required to operate the facility is directly associated with the content and depth of training received. COMMENT: Concerning sec.229.353(b)(6), a commenter suggested that wording be added to require operators to be knowledgeable of how to properly classify a consumer's skin type. RESPONSE: The department agrees and the information has been added. COMMENT: Concerning sec.229.353(c)(7), a commenter suggested adding "the location and operation of each customer's emergency off switch" as information required to be disclosed to the consumer by each operator. RESPONSE: The department concurs and the information has been added. COMMENT: Concerning sec.229.353(d), a commenter objected to the subsection as "excessively open-ended". RESPONSE: The department disagrees since the statute and the rules are specific in requiring the operator to have ultimate responsibility for the safe operation the devices. In making this determination, an operator should consider all relevant information regarding a consumer, including but not limited to a recommendation by a physician if necessary. COMMENT: Concerning sec.229.354(a)(1)(E), a commenter recommended adding "photosensitizing" to the term "prescription or over-the-counter drug" in describing drugs which should trigger a consultation with physician prior to using a tanning device. RESPONSE: The department disagrees since it is not practical for a consumer to make a distinction in all cases between "photosensitizing" and "nonphotosensitizing" drugs. COMMENT: Concerning sec.229.354(a)(1), a commenter suggested adding the statement "Pregnant women should consult their physician before using a tanning device." to the list of required warnings to consumers. RESPONSE: The department agrees and has added the information. COMMENT: Concerning sec.229.354(b)(1), three commenters objected to the requirement that a written statement of acknowledgement of warnings be signed by the customer each time the facility is used or a contract is executed or renewed. RESPONSE: The department disagrees since the requirement is specified in the statute. COMMENT: Concerning sec.229.354(b)(1), a commenter objected to the term "title" in reference to Title 25 of the Texas Administrative Code. RESPONSE: The use of the term "title" is an acceptable and routinely used abbreviation for referencing a particular title designation for the Texas Administrative Code. COMMENT: Concerning sec.229.354(b)(1)-(3), a commenter suggested adding the word "dated" to the requirements for signed parental consent and warning statements. RESPONSE: The department concurs and the information is added. COMMENT: Concerning sec.229.354(b)(2), a commenter suggested adding the phrase "for the first time" to amend the requirement for parental consent for minors wishing to use tanning devices. RESPONSE: The department disagrees since the requirement is specified in the statute. COMMENT: Concerning sec.229.354(c), one commenter objected to the requirement for recording total number of tanning visits and two commenters suggested restricting consumers to tanning sessions of not more than once per day or business day instead of the required 24-hour period. RESPONSE: The department disagrees with the comment regarding the necessity for requiring total number of tanning visits. An adequate consumer profile cannot be evaluated without the consumer's tanning history. This information is used in part by the operator to determine the recommended exposure schedule for each consumer. The department disagrees with the comments regarding the necessity for limiting tanning sessions to once per 24-hour period. The preemptive nature of the federal regulations for tanning devices which are being adopted by reference prohibit an operator from deviating from the manufacturer's recommended exposure schedules for these devices. A reference to daily exposures is considered by both the department and the FDA to be a 24-hour period. COMMENT: Concerning sec.229.354(c), a commenter asked if the 24-hour limitation on subsequent exposures applied to the beginning or end of an exposure period. RESPONSE: The section requires that an exposure not be repeated twice in a 24- hour period. The time the exposure was initiated is considered the beginning of the 24-hour delay period. COMMENT: Concerning sec.229.354(f), a commenter requested that the term "backup" be substituted for the word "copied" in reference to electronic records management. RESPONSE: The department disagrees and believes the subsection is adequate as stated. COMMENT: Concerning sec.229.354(g), a commenter suggested that the section concerning forms available by the Department for use in tanning facilities was unnecessary and represented a liability risk to the state. RESPONSE: The department disagrees since the section does not stipulate the type of forms to be developed and allows the department, at its discretion, to develop forms which may be necessary to implement these sections. COMMENT: Concerning sec.229.355, a commenter asked that the requirement for reporting injuries to the Department be amended to include only "an injury requiring medical treatment". RESPONSE: The department disagrees since the purpose of injury reporting is to provide the department with information regarding the scope of injuries received by consumers. COMMENT: Concerning sec.229.355(5), a commenter suggested that the injury report include the identity of the brand and model of tanning device involved in the incident. RESPONSE: The department agrees and has made the appropriate changes. COMMENT: Concerning sec.229.356(a), a commenter objected to a tanning facility being required to be kept clean and sanitary at all times. RESPONSE: The department disagrees since a clean and sanitary environment must be maintained on a consistent basis to ensure the health and safety of consumers. COMMENT: Concerning sec.229.356(c), a commenter suggested that the phrase "exposure to ultraviolet radiation produced by the tanning equipment itself is not considered a sanitizing agent" be added. RESPONSE: The department disagrees since an almost identical statement already exists in sec.229.356(b). COMMENT: Concerning sec.229.356(d), a commenter objected to having to use test kits to measure the effectiveness of sanitizing solutions used to sanitize protective eyewear. RESPONSE: The department disagrees since a sanitizing solution's effectiveness can only be judged through periodic testing of its active ingredient concentration. COMMENT: Concerning sec.229.356(d), a commenter asked what constituted an approved test kit or device for use in assessing sanitizing solutions and recommended that the solution be tested once per day or only when new batches of sanitizer are prepared. RESPONSE: The section requires that a test kit or device be selected which will accurately measure the concentration of sanitizer. Effective concentrations for sanitizers are determined by the manufacturer based in part on the characteristics of the surface to be sanitized. The department disagrees with the suggestion of testing only once per day or at the time of initial batch preparation since effective concentrations of sanitizer are subject to variation throughout the day based on environmental conditions and degree of use. COMMENT: Concerning sec.229.356(e), a commenter expressed opposition to requiring facilities to provide customers access to toilet and handwashing facilities. RESPONSE: The department disagrees since toilet and handwashing facilities are necessary to ensure basic sanitation and prevent disease transmission. COMMENT: Concerning sec.229.356(e), a commenter asked whether "access" to toilet and handwashing facilities is interpreted to mean within the tanning facility. RESPONSE: "Access" to toilet and handwashing facilities is interpreted to mean in the tanning facility when available, however, at least at all times usable by tanning facility consumers. COMMENT: Concerning sec.229.356(f), a commenter objected to the need to include the terms "soap" and "detergent" when referencing the laundering of towels used in tanning facilities. RESPONSE: The department disagrees and believes this additional clarification is appropriate. COMMENT: Concerning sec.229.356(f), a commenter asked if cloth towels or disposable paper towels had to be provided at no charge to consumers. RESPONSE: The section requires that cloth towels or disposable paper towels must be provided to customers, however, there is no restriction against the facility collecting a fee for this service. COMMENT: Concerning sec.229.356(g), a commenter objected to the necessity of floors in tanning rooms being constructed of nonabsorbent, easily cleanable materials. RESPONSE: The department disagrees and believes the requirement is necessary to ensure basic sanitation and prevent disease transmission. COMMENT: Concerning sec.229.356(g), a commenter objected to using nonabsorbent, easily cleanable floors in tanning rooms on the basis that it will significantly increase the risk of consumer accidents, create consumer discomfort during cold seasons, create a perceived sanitation problem, and create additional expense for operators who remove existing carpeting. RESPONSE: The department disagrees since the current use of nonabsorbent floors in tanning facilities in this state is common and without recognized increase risk potential. Likewise, concerns of foot discomfort in cold seasons and a "perceived" sanitation problem associated with nonabsorbent floors are justifiably offset by the well-documented sanitation benefits of these floors. The department disagrees that operators will be subjected to the additional expense of removing existing floors since the section clearly allows existing floors to remain in place until extensive remodeling is initiated by the operator. COMMENT: Concerning sec.229.356(g), a commenter asked if a floor mat could be used in conjunction with nonabsorbent floors. RESPONSE: Anti-slip floor mats made from nonabsorbent, easily cleanable materials are acceptable if used in conjunction with nonabsorbent floors when the facility believes an increased risk of consumer falls exists and cannot be prevented by other means. COMMENT: Concerning sec.229.357(a), a commenter asked what was meant by "reasonable" with respect to authorized agents of the Department having access to tanning facilities for the purpose of inspection. RESPONSE: "Reasonable times" is interpreted by the department to mean at any time the during which the tanning facility is available for use by the consumer. COMMENT: Concerning sec.229.357(e), a commenter expressed opposition to the terms "adulterated" and "misbranded" as used in this section, stating that these terms cannot be understood by those in the tanning industry. RESPONSE: The department disagrees since the terms "adulterated" and "misbranded" have been defined in sec.229.343 (relating to Definitions). Minor editorial changes were made for clarification purposes. The commenters were: Texas Chapter, Suntanning Association for Education; National Suntanning Association for Education; and Tanning Trends Magazine. The commenters were generally in favor of the rules but expressed concerns, questions, and recommendations. 25 TAC sec.sec.229.341-229.349 The repeal is adopted under the Health and Safety Code, sec.145.011, which provides the department with the authority to adopt necessary regulations pursuant to the enforcement of this Chapter; and sec.12.001, which provides the Texas Board of Health with the authority to adopt rules for the performance of every duty imposed by law on the Texas Board of Health, The Texas Department of Health, and the Commissioner of Health. 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 February 2, 1994. TRD-9435564 Susan K. Steeg General Counsel Texas Department of Health Effective date: February 28, 1994 Proposal publication date: November 9, 1993 For further information, please call: (512) 458-7248 25 TAC sec.sec.229.341-229.357 The sections are adopted under the Health and Safety Code, sec.145.011, which provides the department with the authority to adopt necessary regulations pursuant to the enforcement of this Chapter; and sec.12.001, which provides the Texas Board of Health with the authority to adopt rules for the performance of every duty imposed by law on the Texas Board of Health, the Texas Department of Health, and the Commissioner of Health. sec.229.342. Applicable Laws and Regulations. (a) The "Tanning Facility Regulation Act", Health and Safety Code, Chapter 145, requires the Texas Board of Health to adopt rules regulating tanning facilities. (b) Tanning devices are both electronic products and medical devices as defined by the Federal Food, Drug and Cosmetic Act, 21 United States Code, et seq. and as such are subject to the provisions of that act as well as those of the Texas Food, Drug, and Cosmetic Act, Health and Safety Code, Chapter 431, which requires the Texas Department of Health to adopt rules regulating devices, i.e. tanning devices. (c) Tanning devices used in tanning facilities are required to comply with applicable laws and regulations referenced in these sections which include, but are not limited to the following: (1) 21 Code of Federal Regulations (CFR), Part 801, Labeling (1993); (2) 21 CFR, Subchapter J, Radiological Health (1993); (3) 21 CFR, Part 1010, Performance Standards for Electronic Products-General (1993); and (4) 21 CFR, sec.1040.20, Sunlamp Products and Ultraviolet Lamps Intended for Use in Sunlamp Products (1993). (d) Reconditioned tanning devices must comply with applicable provisions of the Federal Food, Drug and Cosmetic Act and the regulations adopted thereunder and are subject to the provisions of the Texas Food, Drug, Device and Cosmetic Salvage Act, Health and Safety Code, Chapter 432. (e) The effective date for all referenced federal regulations refers to the regulations on the date specified and do not include any additions or deletions subsequent to the date specified. (f) Nothing in these sections shall relieve any person of responsibility for compliance with other pertinent Texas and federal laws and regulations. (g) Copies of these laws and rules are indexed and filed in the office of the Division of Food and Drugs, Texas Department of Health, 1100 West 49th Street, Austin, Texas 78756, and are available for inspection during normal working hours. sec.229.343. Definitions. The following words and terms, when used in these sections, shall have the following meanings, unless the context clearly indicates otherwise. Act-The Tanning Facility Regulation Act (Act), Texas Civil Statutes, Article 8910 (House Bill 2352, 71st Legislature, Regular Session, 1989), codified as Health and Safety Code, Chapter 145. Adulterated-Has the meaning given in the Texas Food, Drug, and Cosmetic Act, Health and Safety Code, Chapter 431, as interpreted in the rules of the board and judicial decision. Authorized agent -An employee of the department designated by the commissioner to enforce the Act. Commissioner-The commissioner of health. Department-The Texas Department of Health. Health authority -A physician designated to administer state and local laws relating to public health. Misbranded-Has the meaning given in the Texas Food, Drug, and Cosmetic Act, Health and Safety Code, Chapter 431, as interpreted in the rules of the board and judicial decision. Operate-To own, manage, or control a tanning facility, or to offer tanning services to the public. Operator-A tanning facility owner, or an agent of a tanning facility owner, or a person who operates a tanning facility. Person-An individual, partnership, corporation, or association. Phototherapy device -A piece of equipment that emits ultraviolet radiation and that is used by a health care professional in the treatment of disease. Radiation-Ultraviolet radiation. Radiation machine -Any device capable of producing radiation. Reconditioning-Has the meaning given in the Texas Food, Drug, Device, and Cosmetic Salvage Act, Health and Safety Code, Chapter 432, as interpreted in the rules of the board in sec.229.192 of this title (relating to Regulation of Food, Drug, Device and Cosmetic Salvage Establishments and Brokers) and judicial decision. Tanning device -A device, as defined in the Texas Food, Drug, and Cosmetic Act, Health and Safety Code, Chapter 431, that emits electromagnetic radiation with wavelengths in the air between 200 and 400 nanometers and that is used for tanning of human skin, including a sunlamp, tanning booth, or tanning bed. A tanning device is also classified as a medical device, as defined in the Federal Food, Drug and Cosmetic Act and the applicable Code of Federal Regulations. The term also includes any accompanying equipment, including protective eyewear, timers, and handrails. Tanning facility -A business that provides persons access to tanning devices. sec.229.345. Permitting of Tanning Facilities. (a) A person may not operate a tanning facility without a current and valid permit to operate the facility that is issued by the Texas Department of Health (department). (b) The permit shall be displayed in an open public area of the tanning facility. (c) Each person acquiring or establishing a tanning facility after the effective date of these sections shall apply to the department for a permit of such facility prior to beginning operation. (d) Unless the department revokes or suspends a permit as provided in sec.229.347 of this title (relating to Revocation, Cancellation, Suspension and Probation of a Permit), the initial permit shall be valid for one year from the date of issuance which becomes the anniversary date. (e) The renewal permit shall be valid for one year from the anniversary date. (f) Permits shall not be transferable from one person to another or from one tanning facility to another. (g) The application required in subsections (c) and (d) of this section shall be completed on forms provided by the department and shall contain all the information required by such forms and any accompanying instructions. (h) On the forms provided for applying for permitting of each tanning facility, the facility shall provide the: (1) name, physical address, mail address and telephone number of the tanning facility; (2) if a proprietorship, the name of the proprietor; if a partnership, the names of all partners; if a corporation, the names of the corporate officers and/or directors, a copy of the articles of incorporation, and the name and address of its registered agent in the state; or if any other type of association, the names of the principals of such association; (3) the name(s), mailing address(es), telephone number(s) and valid driver's license number(s) of: (A) the proprietor, in the case of a sole proprietorship; (B) the managing partner in the case of a partnership; (C) the officers and/or directors in the case of a corporation; (D) the operator in charge of the tanning facility; (4) hours of operation of each tanning facility; (5) manufacturer(s), model number(s), and type(s) of ultraviolet lamp(s) for all tanning devices located at the tanning facility; (6) name(s) of the tanning device supplier(s), installer(s), and service agent(s); (7) copies of any posted warnings or notices which are required by this section and which address the safety and proper use of tanning devices; (8) copies of the consent forms and statements which the consumer, parent or legal guardian will sign as required in sec.229. 354 of this title (relating to Records); (9) procedures which the operator(s) will be required to follow for the correct use of tanning device(s) , to include: (A) instructions to the consumer; (B) use of protective eyewear; (C) suitability of prospective consumers for tanning device use; (D) determination of duration of tanning exposures; (E) periodic testing of tanning device(s) and timer(s); (F) handling of complaints of injury from consumers; (G) records to be maintained on each consumer; and (10) application form which shall be verified and signed by the owner. (i) Failure to complete the application form may result in the denial of a permit. sec.229.347. Revocation, Cancellation, Suspension and Probation of a Permit. (a) The Texas Department of Health (department) may revoke, cancel, suspend, or probate a permit to operate a tanning facility if the facility has: (1) failed to pay a permit fee or an annual renewal fee for a permit; (2) obtained or attempted to obtain a permit by fraud or deception; (3) violated any of the provisions of the Act; or (4) violated any of the provisions of these sections. (b) Prior to revoking, canceling, suspending or probating a permit, the department shall give the permit holder written notice of the proposed action, including the reasons and an opportunity for a hearing. (c) Any hearing for the revoking, canceling, suspending, or probating of a permit shall be in accordance with the department's formal hearing procedures in Chapter 1 of this title (relating to Texas Board of Health). (d) A permit issued under these sections shall be returned to the department if the tanning facility: (1) ceases business or otherwise ceases operation on a permanent basis; (2) relocates; or (3) changes ownership. For a corporation, an ownership change is deemed to have occurred, resulting in the necessity to return the permit to the department, when 5.0% or more of the share of stock of a corporation is transferred from one person to another. sec.229.348. Report of Changes. The permit holder shall notify the Texas Department of Health (department) in writing within 10 days of any change which would render the information contained in the application for the permitting, reported pursuant to sec.229.345 of this title (relating to Permitting of Tanning Facilities), no longer accurate. Failure to inform the department within 10 days of a change in the information required in the application for a permit may result in a suspension or revocation of the permit. This requirement shall not apply for changes involving replacement of designated original equipment lamp types with lamps which have been certified with the United States Food and Drug Administration (FDA) as "equivalent" lamps under the FDA regulations and policies applicable at the time of replacement of the lamps. The facility operator shall maintain lamp manufacturer's labeling at the facility, demonstrating the equivalence of any replacement lamps. sec.229.349. Advertising. No person, in any advertisement, shall refer to the fact that the person or the person's facility is permitted with the Texas Department of Health (department) pursuant to the provisions of sec.229.345 of this title (relating to Permitting of Tanning Facilities), and no person shall state or imply that any activity under such permit has been approved by the department. A tanning facility may not claim, or distribute promotional materials that claim, that using a tanning device is safe or free from risk or that using the device will result in medical or health benefits. The only claims that may be made for tanning are cosmetic. sec.229.351. Tanning Devices. (a) Only tanning devices manufactured and certified to comply with 21 Code of Federal Regulations (CFR) Part 1040, sec.1040.20, "Sunlamp products and Ultraviolet Lamps Intended for Use in Sunlamp Products", shall be used by or sold to tanning facilities. Tanning devices that have been reconditioned must comply with federal and state requirements. Tanning device reconditioners must be licensed under the Texas Food, Drug, Device, and Cosmetic Salvage Act, Health and Safety Code, Chapter 432. Compliance shall be based on the standard in effect at the time of manufacture as shown on the device identification label required by 21 CFR, Part 1010, sec.1010.3. Tanning devices must also comply with the medical device labeling requirements of 21 CFR, Part 801. (b) All tanning devices shall have a timer which complies with the requirements of 21 CFR, Part 1040, sec.1040.20(c)(2). The maximum timer interval shall not exceed the manufacturer's maximum recommended exposure time. No timer interval shall have an error greater than plus or minus 10% of the maximum timer interval for the product. (c) The operator shall limit the exposure time of a customer on a tanning device to the maximum exposure time recommended by the manufacturer, taking the customer's skin type into consideration. (d) Tanning device remote timers shall be installed and located so that the customer may not set or reset the customer's own exposure time. Remote timer systems must comply with the requirements for timers as provided in subsection (b) of this section. (e) No operator shall sell, or otherwise make available to any user of a tanning device, tokens required to operate the tanning device in quantities greater than the tanning device manufacturer's maximum recommended exposure time for the user. (f) The facility operator shall control the temperature of the consumer contact surfaces of a tanning device and the surrounding area so that it may not exceed 100 degrees Fahrenheit. (g) There shall be physical barriers to protect consumers from injury induced by touching or breaking the lamps. (h) The tanning devices shall be maintained in good repair. (i) Defective or burned-out lamps or filters shall be replaced with a type intended for use in that device as specified on the device label, or with lamps or filters that are "equivalent" under the Federal Drug Administration (FDA) regulations and policies applicable at the time of lamp manufacture. (j) A tanning device used by a tanning facility must comply with all applicable state and local electrical code requirements. (k) When a tanning device is being used by an individual, no other person shall be allowed to remain in the tanning device area. (l) In addition, stand-up booths shall: (1) have physical barriers or other means such as handrails or floor markings to indicate the proper exposure distance between ultraviolet lamps and the consumer's skin; (2) be constructed to withstand the stress of use and the impact of a falling person; (3) have rigid doors which open outward; and (4) have handrails and non-slip floors. sec.229.353. Operators. (a) A tanning facility shall have an operator present during operating hours. (b) Each operator must be sufficiently trained and knowledgeable in the correct operation of the tanning devices used at the facility to adequately inform and assist each customer in the proper use of the tanning devices. A record of all training received by each operator shall be kept at the tanning facility where the operator is employed. The record shall be signed by the operator and the owner. The operator must be able to demonstrate such knowledge concerning the: (1) requirements of these sections and the Tanning Facility Regulation Act; (2) procedures for correct operation of the facility; (3) recognition of injury or overexposure; (4) manufacturer's procedures for operation and maintenance of all tanning devices; (5) emergency procedures in case of injury; (6) classification of consumer skin types and the recommended exposure times for all skin types; and (7) maintenance of records required by sec.229.354 of this title (relating to Records). (c) The operator must understand, be competent to explain, and at a minimum, inform each customer using a tanning device for the first time of: (1) the potential hazards and protective measures associated with ultraviolet radiation exposure; (2) the requirement to wear protective eyewear while using the tanning device; (3) the possibility of photosensitivity and photoallergenic reaction of some persons to drugs, medicine, and other agents when subjected to sun and ultraviolet radiation exposure; (4) the correlation between skin type and exposure time; and the maximum exposure time of the facility's devices; (5) the biological process of tanning; (6) the dangers and necessity of avoiding overexposure; and (7) the location and operation of the exposure termination control for the tanning device. (d) If an operator suspects that possible harm may result from tanning, the consumer should be advised to consult their private physician. sec.229.354. Records (a) Liability notice. (1) A tanning facility operator shall give each customer a written statement warning that: (A) failure to use the eye protection provided to the customer by the tanning facility may result in permanent damage to the eyes; (B) overexposure to ultraviolet light causes burns; (C) repeated exposure may result in premature aging of the skin and skin cancer; and (D) abnormal skin sensitivity or burning may be caused by reactions of ultraviolet light to certain: (i) foods; (ii) cosmetics; or (iii) medications, including: (I) tranquilizers; (II) diuretics; (III) antibiotics; (IV) high blood pressure medicines; or (iv) birth control pills; and (E) any person taking a prescription or over-the-counter drug should consult a physician before using a tanning device; and (F) pregnant women should consult their physicians before using a tanning device. (2) Compliance with the notice requirements does not affect the liability of a tanning facility operator or a manufacturer of a tanning device. (b) Signed warning statement. (1) Each time a customer uses a tanning facility or each time a person executes or renews a contract to use a tanning facility, the person shall sign and date a written statement acknowledging that the person has read and understood the required warnings in sec.229.350 of this title (relating to Warning Signs) before using the device and agrees to use the protective eyewear. (2) Before any person under the age of 18 years uses a tanning device, the person shall give the tanning facility operator a statement signed and dated by the person's parent or legal guardian stating that the parent or legal guardian has read and understood the warnings given by the tanning facility operator, consents to the minor's use of a tanning device, and agrees that the minor will use the protective eyewear. When a person under 14 years of age is using a tanning device, a parent or legal guardian must be present at the tanning facility. (3) For illiterate or visually handicapped persons, the warning statement shall be read by the operator in the presence of a witness. Both the witness and the operator shall sign and date the statement. (c) Consumer log information. An individual record shall be kept by the facility operator of each consumer's total number of tanning visits, exposure lengths in minutes, times and dates of the exposures, and any injuries or illnesses resulting from the use of a tanning device. The operator must ensure that no individual is allowed to use a tanning device more than once every 24 hours. (d) Record retention. All records required by this section shall be maintained at the tanning facility for a minimum of three years. (e) Access to records. A person who is required to maintain records under this section or a person who is in charge or custody of those records shall, at the request of an authorized agent or health authority, permit the authorized agent or the health authority at all reasonable times access to and to copy and verify the records. (f) Electronic records. Records required by these sections which are maintained by the tanning facility on computer systems shall be regularly copied, at least monthly, and updated on storage media other than the hard drive of the computer. An electronic record must be retrievable as a printed copy. (g) Forms. Forms which have been developed by the Texas Department of Health for use by tanning facilities will be provided upon request as camera ready copies for reproduction purposes. sec.229.355. Injury Reports. A written report of any tanning injury shall be forwarded to the Texas Department of Health (department) within five working days of its occurrence or knowledge thereof. The report shall include: (1) the name of the affected individual; (2) the name and location of the tanning facility involved; (3) the date of the injury; (4) the nature of the injury; (5) identification of the tanning device involved in the injury, including brand and model; (6) the name and address of health care provider, if any; (7) the name of the operator on duty at the time of injury; and (8) any other information considered relevant to the situation. sec.229.357. Enforcement and Penalties. (a) Inspections. The commissioner or an authorized agent shall have access at all reasonable times to any tanning facility to inspect the facility to determine if the Tanning Facility Regulation Act (Act) or these sections are being violated. (b) Criminal penalty. (1) A person, other than a customer, commits an offense if the person knowingly or recklessly violates the Act or rules adopted under the Act. (2) An offense under the Act is a Class C misdemeanor. (c) Injunction. (1) If the commissioner, an authorized agent, or a health authority finds that a person has violated, or is violating or threatening to violate the Act and that the violation or threat of violation creates an immediate threat to the health and safety of the public, the commissioner, authorized agent, or health authority may petition the district court for a temporary restraining order to restrain the violation or threat of violation. (2) If a person has violated, or is violating or threatening to violate the Act, the commissioner, an authorized agent, or a health authority may petition the district court for an injunction to prohibit the person from continuing the violation or threat of violation. (3) On application for injunctive relief and a finding that a person is violating or threatening to violate the Act, the district court shall grant any injunctive relief warranted by the facts. (d) Venue. Venue for a suit brought under the Act shall be in the county in which the violation or the threat of violation is alleged to have occurred or in Travis County. (e) Adulterated or misbranded tanning device. If the Texas Department of Health (department) identifies an adulterated or misbranded tanning device, the department may enforce the applicable provisions of Subchapter C of the Texas Food, Drug, and Cosmetic Act (Health and Safety Code, Chapter 431) including, but not limited to: detention, condemnation, civil penalties, criminal enforcement, and/or administrative penalties, using the Severity Levels set out in sec.229.261 of this title (relating to Assessment of Administrative or Civil Penalties). 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 February 2, 1994. TRD-9435563 Susan K. Steeg General Counsel Texas Department of Health Effective date: February 28, 1994 Proposal publication date: November 9, 1993 For further information, please call: (512) 458-7248 Chapter 295. Occupational Health Hazard Communication 25 TAC sec.295.6, sec.295.9 The Texas Department of Health (department) adopts the repeal of sec.295.6 and sec.295.9, concerning hazard communication. The repealed sections are adopted without changes to the proposed text as published in the Novmeber 9, 1993, issue of the Texas Register (18 TexReg 8121). Section 295.6 concerned employer responsibilities for filing hazardous chemical inventory reports under community right-to-know, and sec.295.9 concerned fees for filing these reports. Both of the repealed sections are no longer applicable to the Hazard Communication Act, Chapter 502 of the Health and Safety Code, because of the revision of the Act by the 73rd Legislature. The community right- to-know provisions of the original Act are now contained in Chapters 505, 506 and 507 of the Health and Safety Code and new rules applicable to these chapters are adopted in this issue of the Texas Register under sec.sec.295.181-295.183. The department did not receive any comments concerning the repeal of these sections. The repeals are adopted under the Health and Safety Code, sec.502.019, which provides the Texas Board of Health with authority to adopt rules to carry out the provisions of this chapter; and sec.12.001, which provides the board with the authority to adopt rules necessary to implement every duty imposed by law on the board, the department, and the commissioner of health. The repealed sections implement Chapter 502 of the Health and Safety Code. 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 February 2, 1994. TRD-9435554 Susan K. Steeg General Counsel Texas Department of Health Effective date: February 23, 1994 Proposal publication date: November 9, 1993 For further information, please call: (512) 834-6600 Texas Asbestos Health Protection 25 TAC sec.295.71 The Texas Department of Health (department) adopts new sec.295.71, with changes to the proposed text as published November 9, 1993, issue of the Texas Register (18 TexReg 8121). The section adopts by reference the United States Environmental Protection Agency's (EPA) regulations pertaining to emissions of asbestos to the air. The new section implements the provisions of House Bill 1680 (73rd Legislature) which amended Texas Civil Statutes, Article 4477-3a, sec.12, (Texas Asbestos Health Protection Act) by adding subsections (k)-(n). The amendments to the Act provide the department with the authority to adopt rules to implement and enforce the provisions of the National Emission Standards for Hazardous Air Pollutants (NESHAP), 40 Code of Federal Regulations (CFR), Part 61, Subpart M, sec.sec.61.140, 61.141, 61.145, 61.146, 61.148, 61.150, 61.152 and 61.157 commonly referred to as the Asbestos NESHAP. The new section also establishes authority for the department to conduct inspections and enforcement actions for asbestos NESHAP; such authority has transferred from the Texas Air Control Board (now a part of the Texas Natural Resource Conservation Commission) to the department. A summary of comments received during the comment period is as follows. Comment: Concerning sec.295.71(a) and (b), a comment was made that 40 CFR, Part 61, Subpart M, sec.61.150 should be adopted as well. Response: The department agrees, since disposal is a regulatory requirement in the amended Act and has included sec.61.150 in the final rule. Disposal issues will be addressed by a memorandum of understanding with the Texas Natural Resource Conservation Commission (see sec.295.71(d)). Also, 40 CFR, Part 61, sec.61.152 in the NESHAP pertains to air cleaning required under other sections adopted by reference, so sec.61.152 has been adopted in the final rule as well. One minor editorial change was made for clarification purposes. The Asbestos Advisory Committee provided the only comment received during the comment period. The committee supported the rules and provided additional information needed for final adoption. The new section is adopted under Texas Civil Statutes, Article 4477-3a, sec.12, which provides the Board of Health (Board) with the authority to adopt rules covering asbestos removal, encapsulation or enclosure, including licensing and regulation; Senate Bill 1341 and House Bill 79, 72nd Legislature, 1991, and by House Bill 1680, Senate Bill 1045 and House Bill 1826, 73rd Legislature, 1993, which amended Article 4477-3a; and Health and Safety Code, sec.12.001 which provides the Board with authority to adopt rules to implement every duty imposed by law on the Board, the Department and the Commissioner of Health. sec.295.71. National Emission Standards for Hazardous Air Pollutants (NESHAP) Compliance. (a) Authority. The Texas Department of Health (department) adopts by reference rules regarding demolition and renovation activities covered under 40 Code of Federal Regulations (CFR), Part 61, Subpart M, sec.sec.61.140, 61.141, 61.145, 61.146, 61.148, 61.150, 61.152 and 61.157 (NESHAP), effective February 3, 1994. (b) Scope. An owner or operator of a demolition of renovation activity (as defined in 40 CFR, sec.61.141) shall assure compliance with NESHAP for all covered activities. (c) Inspections. The department may enter any facility to inspect and investigate conditions to determine compliance. (d) Disposal. The department shall develop a memorandum of understanding with the Texas Natural Resource Conservation Commission (TNRCC) concerning the inspection of solid waste facilities that receive asbestos waste. (e) Enforcement. The department will enforce the provisions of the NESHAP in accordance with sec.295.70 of this title (relating to Compliance: Administrative Penalty) and with the Texas Asbestos Health Protection Act, Texas Civil Statutes, Article 4477-3a. 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 February 2, 1994. TRD-9435553 Susan K. Steeg General Counsel Texas Department of Health Effective date: February 23, 1994 Proposal publication date: November 9, 1993 For further information, please call: (512) 834-6610 Hazardous Chemical Right-to-Know 25 TAC sec.sec.295.181-295.183 The Texas Department of Health (department) adopts new sec.sec.295.181- 295.183, with changes to the proposed text as published in the November 9, 1993, issue of the Texas Register (18 TexReg 8122). New sec.295.81 concerns chemical information which must be provided by manufacturing facilities; new sec.295.82 concerns chemical information which must be provided by public employers; and new sec.295.83 concerns chemical information which must be provided by non-manufacturing facilities. The new sections specify standards for filing annual facility chemical reports with the department and local emergency response agencies, procedures for providing direct citizen access to facility chemical information, violations and administrative penalties, and filing fees which must be paid to the department. These sections are adopted to specify how chemical information will be submitted by facility operators and public employers for emergency planning and public interest purposes. As a result of suggested wording changes in sec.295.181 and sec.295.183 during the comment period, the department has made wording changes to sec.295. 182, in order to provide consistency in each of the sections. A new paragraph (3) in sec.295.182(a) was added to specify that the section applies only to public employers, and sec.295.182(b) has been revised to reference the definitions contained in Chapter 506. For clarification purposes, a definition for "director" has been added to subsection (b) in sec.sec.295.181-295.183, which refers to the department's commissioner. The following text is a summary of comments received regarding sec.sec.295. 181-295.183 and the department's response to the comments. COMMENT: Two commenters proposed the addition of a subsection to define applicability of the section in sec.295.181(a). RESPONSE: The department agreed and added sec.sec.295.181(a)(3), 295.182(a)(3) and 295.183(a)(3) to specify the applicability of each of the sections. COMMENT: Regarding sec.295.181(b) and sec.295.183(b), one commenter proposed to incorporate by reference the definitions contained in Chapters 505 and 507 of the Health and Safety Code. RESPONSE: The department agreed and added a subsection (b) to sec.sec.295. 181- 295.183, which adopts the definitions of Chapters 505, 506 and 507. COMMENT: Regarding sec.295.181(b), one commenter suggested adding a definition for the phrase "hazardous chemical categories", which is referenced, but not defined, in Chapter 505. The commenter also suggested wording for this definition. RESPONSE: The department concurred and added a new definition for "hazardous chemical categories" to sec.295.181(b)(5). This definition incorporates the suggested wording of the commenter, but contains additional wording to clarify that the United States Environmental Protection Agency (EPA) must approve such categories. COMMENT: Regarding sec.295.181(d), one commenter requested a revision to allow either "hazardous chemicals" or "hazardous chemical categories" to be reported on the facility's Tier Two forms. This commenter also suggested deleting the reference to "extremely hazardous substances" (EHSs), since EHSs are covered by the phrases "hazardous chemicals" or "hazardous chemical categories". RESPONSE: A definition, sec.295.181(b)(5) is added, for "hazardous chemical categories". This definition, in addition to new language in sec.295.181(d)(1) and (6) and (h)(2)(A)-(E), will provide the department with flexibility in accepting future Tier Two reports based on hazardous chemical categories, if the department receives approval from the EPA under the federal Emergency Planning and Community Right-to-Know Act (EPCRA). Approval from the EPA would allow the department to accept a facility's Tier Two report as a single compliance document for both the state law and EPCRA, which would reduce paperwork for reporting facilities and the department. The department has not deleted the reference to "extremely hazardous substances". Even though the phrase may be redundant, it is believed to contribute to the clarity of this section. COMMENT: Regarding sec.295.181(d)(6), one commenter proposed that the reference to the Branch's Paperwork Reduction Policy be deleted, since the subsection implies that the there are departmental policy restrictions on the Tier Two reports, over and beyond the restrictions of Chapter 505. The commenter also recommended revising the section to reflect the chapter's language on multiple facility reporting. RESPONSE: The department agrees that this subsection describes multiple facility reporting procedures which conflict with the chapter's language. The language in sec.295.181(d)(6) has been revised, using the suggested language provided by the commenter. COMMENT: Regarding sec.295.181(g), one commenter suggested that the administrative penalty procedures of Chapter 505 be incorporated by reference into the rule. RESPONSE: The department's response is to add a new subsection under sec.295. 181(g), incorporating the administrative penalty procedures of Chapter 505. The department agrees that the language in the new subsection will clarify these procedures. COMMENT: Regarding sec.295.181(g)(6), one commenter suggested that it was inappropriate for the rule to limit the department's flexibility in reducing or eliminating a penalty, when justified by the considerations in this subsection. The commenter also suggested that the department add language which would clarify that penalty enhancements were subject to the penalty caps in the statute. RESPONSE: The department added the necessary language to sec.295.181(g)(6) to allow penalty reduction flexibility and to ensure consistency with the maximum penalties allowed under Chapter 505. COMMENT: Regarding sec.295.181(h)(2), one commenter proposed that sec.295. 181(h)(2) indicate that fees may be based on either the number of hazardous chemicals or "hazardous chemical categories" at the reporting facility. RESPONSE: The phrase "hazardous chemical categories" has been added to each subsection under sec.295.181(h)(2). This language will give the department the flexibility to base the fees on hazardous chemical categories, in the event that such reporting is allowed for future Tier Two reports. As previously stated, such reporting is subject to the approval of the EPA. COMMENT: Regarding sec.295.181(h)(3), four commenters suggested that the provision in this subsection concerning a cap for consolidation of filing fees for multiple Tier Two forms was not a part of Chapter 505, and conflicted with the legislative intent of the chapter. The commenters also suggested that the cap on consolidation of fees was not addressed by the task force which drafted Chapter 505. RESPONSE: The department's response is to delete the provision which created a cap on consolidated filing fees. The department disagrees with the suggestion that unlimited consolidation of filing fees is a statutory requirement, since the language in the statute authorizes the department to establish rules relating to fees. The department is required to recover its administrative costs of the community right-to-know program through the collection of fees, and since unlimited consolidation of filing fees could lead to a budget deficit, the department may need to set caps on consolidation of filing fees to recover its costs. However, after receiving this comment, the department re-evaluated the current fiscal year's fee projections, based on the current level of consolidation of filing fees. The results of this study indicated that deletion of the cap on consolidation of fees would not result in a budget deficit at this time. Nevertheless, the department may be required to propose such a cap in future rules, contingent on adequate funding. COMMENT: Regarding sec.295.182(g)(2), one commenter suggested that the penalty assessment provisions conflicted with those of Chapter 506, in that the rule would establish only one penalty amount ($50 per day for a violation), rather than a maximum penalty amount. RESPONSE: The department agrees with this comment and has revised the language in sec.295.182(g)(2) to indicate that administrative penalties will not exceed $50 per violation. COMMENT: Regarding sec.295.182(h)(3), two commenters suggested that the provision in this subsection concerning a cap for consolidation of filing fees for multiple Tier Two forms was not a part of Chapter 506, and conflicted with the legislative intent of the chapter. RESPONSE: The department's response is to delete the provision which created a cap on consolidated filing fees. As noted in the previous comment on caps for fee consolidation in sec.295.181(h)(3), the department disagrees with these suggestions and notes that the department may be required to propose such a cap in future rules, contingent on adequate funding. COMMENT: Regarding 295.183(b), one commenter suggested minor revisions in the wording of the definition for "hazardous chemical categories". RESPONSE: The department reworded the definition for "hazardous chemical categories", which incorporates the suggested wording of the commenter, but contains additional wording to clarify that the EPA must approve such categories. COMMENT: Regarding sec.295.183(d)(1), one commenter suggested language be added that would allow the director to approve the use of additional generic Tier Two forms for well-defined industries, where the hazardous chemical categories are easily definable and generic forms would greatly simplify reporting. The commenter also suggested deleting the reference to "extremely hazardous substances" (EHSs), since EHSs are covered by the phrases "hazardous chemicals" or "hazardous chemical categories". RESPONSE: The department agrees that new language in this section would provide more flexibility for reporting by certain industries. Therefore, the language in sec.295.183(d)(1) has been revised to allow for simplified reporting by specific types of industries, subject to EPA approval. The department has not deleted the reference to "extremely hazardous substances". Even though the phrase may be redundant, it is believed to contribute to the clarity of this section. COMMENT: Regarding sec.295.183(d)(5), two commenters requested deletion of this subsection, which requires that facility operators maintain a copy of the facility's most current Tier Two form in the workplace. The commenters explained that such a requirement would pose a difficulty for workplaces whose corporate offices would be filing and maintaining such forms. RESPONSE: The department agrees with this comment and has deleted this subsection. COMMENT: Regarding sec.295.183(d)(6), two commenters proposed that the reference to the Branch's Paperwork Reduction Policy be deleted, since the subsection implies that the there are departmental policy restrictions on the Tier Two reports, over and beyond the restrictions of Chapter 507. One commenter also recommended revising the section to reflect the chapter's language on multiple facility reporting. RESPONSE: The department agrees that this subsection describes multiple facility reporting procedures which conflict with the chapter's language. The department's response is to revise the language in sec.295.183(d)(6), using the suggested language provided by one of the commenters. COMMENT: Regarding sec.295.183(f), one commenter noted that this section does not address the administrative penalty procedures detailed in Chapter 507 and suggested that these procedures be made a part of this section. In addition, the commenter noted that the penalty assessment provisions conflicted with those of Chapter 507, in that the rule would establish only one penalty amount ($50 per day for a violation), rather than a maximum penalty amount. The commenter proposed revised language for this subsection. RESPONSE: The department agrees and has revised the language in sec.295. 183(f)(2). The new language will incorporate the administrative penalty procedures of Chapter 507 and will establish $50 as the maximum penalty per violation. COMMENT: Regarding sec.295.183(g)(3), six commenters suggested that the provision in this subsection concerning a cap for consolidation of filing fees for multiple Tier Two forms was not a part of Chapter 507, and conflicted with the legislative intent of the chapter. The commenters also suggested that the cap on consolidation of fees was not addressed by the task force which drafted Chapter 507. RESPONSE: The department's response is to delete the provision in sec.295. 183(g)(3) which created a cap on consolidated filing fees. As noted in the previous comments on caps for fee consolidation in sec.295.181(h)(3) and sec.295. 182(h)(3), the department disagrees with these suggestions and notes that the department may be required to propose such a cap in future rules, contingent on adequate funding. Minor editorial changes were made for clarification purposes. Representatives from the Texas Senate, the Texas House of Representatives, the Texas Mid-Continent Oil and Gas Association in Midland, the Texas Independent Producers and Royalty Owners Association in Austin, Mitchell Energy and Development Corporation in The Woodlands, Pennzoil Company in Houston and the Texas Municipal League in Austin presented comments, questions and suggestions for changes to the proposed rules as discussed in the summary of comments. The new sections are adopted under sec.sec.505.016, 506.017 and 507.013 of the Health and Safety Code, which provide the Texas Board of Health with authority to adopt rules to carry out the purposes of these chapters; and the Health and Safety Code, sec.12, which provides the board with the authority to adopt rules necessary to implement every duty imposed by law on the board, the department and the commissioner of health. sec.295.181. Manufacturing Facility Community Right-to-Know. (a) Purpose and scope. (1) The purpose of these rules is to provide the public with access to information on hazardous chemicals in their communities, to enhance community awareness of chemical hazards and facilitate community planning and response to chemical emergencies. (2) In order to avoid confusion among manufacturing employers and persons living in this state, the Texas Department of Health (department) shall implement the Manufacturing Facility Community Right-To-Know Act compatibly with the federal Emergency Planning and Community Right-To-Know Act of the United States Environmental Protection Agency (EPA). (3) These rules are applicable to operators of manufacturing facilities in Standard Industrial Classification (SIC) Codes 20-39. (b) Definitions. In addition to the terms which are defined by the Manufacturing Facility Community Right-To-Know Act, the following words, acronyms, and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise. (1) Act-The Manufacturing Facility Community Right-To-Know Act. (2) Director-The commissioner of the department. (3) EPCRA or SARA, Title III-The federal Emergency Planning and Community Right-To-Know Act, also known as the Superfund Amendments and Reauthorization Act of 1986, Title III, Public Law Number 99-499 et seq. (4) EHS or extremely hazardous substance-Any substance as defined in EPCRA, sec.302, or listed by the EPA in Title 40 Code of Federal Regulations, Part 355, Appendices A and B. (5) Hazardous chemical category-A group or class of hazardous chemicals with similar uses or production methods in a specified industrial process or processes which are specifically approved by the EPA to be reportable as a hazardous chemical. (6) Workplace chemical list-A list of hazardous chemicals developed under Title 29 Code of Federal Regulations, sec.1910.1200(e)(i). (c) Responsibility for implementation of program. The director's responsibilities under the Act are carried out through the Texas Department of Health, Division of Occupational Health, Hazard Communication Branch. Compliance documents and routine inquiries regarding this Act shall be addressed, until further notice by the director, to: Texas Department of Health, Division of Occupational Health, Hazard Communication Branch, 1100 West 49th Street, Austin, Texas 78756. (d) Facility chemical list. (1) A facility operator covered by this section shall compile and maintain a facility chemical list using the most current version of the Texas Tier Two Cover Sheet and Texas Tier Two Chemical Description Sheet, or a federal Tier Two Emergency and Hazardous Chemical Inventory form accompanied by a Texas Tier Two Cover Sheet. The Tier Two form must be typed or may be mechanically reproduced (subject to approval of the department) for all hazardous chemicals, hazardous chemical categories, and extremely hazardous substances present at the facility in quantities that meet or exceed current thresholds as determined by the EPA in Title 40 Code of Federal Regulations, Part 370. (2) A Texas Tier Two Cover Sheet and either a Texas Tier Two Chemical Description Sheet or a federal Tier Two Emergency and Hazardous Chemical Inventory form shall be used to comply with reporting requirements of EPCRA, sec.311 and sec.312. (3) Facility operators shall file an annual Tier Two form, accompanied by the appropriate filing fee as provided under the Act, sec.505.016(b), with the Hazard Communication Branch no later than March 1st of each year, covering the previous calendar year. A facility operator beginning operation shall file a Tier Two form and the appropriate fee no later than the 90th day after the date on which the operator begins operation. The facility operator shall furnish a copy of each Tier Two form to the fire chief of the fire department having jurisdiction over the facility and to the appropriate Local Emergency Planning Committee. (4) A facility operator shall file an updated Tier Two form with the department not later than the 90th day after the date on which the operator has a reportable addition of a previously unreported hazardous chemical or EHS. No fee will be charged for filing this report. The facility operator shall furnish a copy of each updated Tier Two form to the fire chief and to the appropriate Local Emergency Planning Committee. (5) A facility operator shall maintain in the workplace a copy of the facility's current Tier Two form until such time as the facility operator files the following year's Tier Two form with the department. (6) For the purpose of paperwork reduction, multiple facilities may be reported on the same tier two form, with appropriate facility identifiers, if the hazardous chemicals or hazardous chemical categories present at the multiple facilities are in the same ranges. In multiple facility reporting, the reporting thresholds must be applied to each facility rather than to the total quantities present at all facilities (e) Direct citizen access to information. (1) A facility must provide within 10 working days of the date of receipt of a citizen's request under the Act, sec.505.007(a), a copy of the facility's existing workplace chemical list or a modified version of the most recent Tier Two form using a 500-pound threshold. Except as otherwise provided in this section, such documents shall be furnished or mailed to the citizen requesting the information. The modified version of the most recent Tier Two form must include completed chemical description blocks for each chemical reported. (2) Any facility that has received requests equal to or in excess of those designated under the Act, sec.505.007(c) , may elect to furnish the material to the department. (3) Any facility electing to furnish materials to the department must notify the department in writing, and must provide to the department copies of the previous requests which meet the request frequency rate as specified in sec.505. 007(c). The facility must inform persons making requests of the availability of the information from the department. (f) Complaints and investigations. (1) The director or his designated representative shall investigate in a timely manner a complaint relating to an alleged violation of the Act. (2) Complaints are not necessary to conduct an inspection under this section. The director or his designated representatives may enter a facility at reasonable times to conduct random compliance inspections. An employer who refuses to allow such an inspection shall be in violation of the Act. (3) The department may find multiple violations by a facility based on specific requirements of the Act. (g) Administrative penalties. (1) Inspections may be conducted by the director or his designated representative to determine if persons are in violation of the Act or the rules adopted by the Board of Health to enforce the Act. Persons found to be in violation will be notified in writing of the violation. (2) Employers found to be in violation of the Act are subject to administrative penalties, as authorized by the Act and to be administered in accordance with the procedures detailed in the Act, sec.sec.505. 010-505.012. Each violation will be assessed as a separate penalty. The total penalty will be the sum of all individual violation penalties. (3) Violations will be classified in one of three levels: (A) a minor violation, which poses a minimal threat to the health and safety of the public; (B) a serious violation, which is a threat to the health and safety of the public; or (C) a critical violation, which has caused or is likely to cause harm to the health and safety of the public. (4) Penalties will be charged based on the following schedule: [graphic] (5) A penalty shall be assessed for each day a violation continues, with a total penalty not to exceed $5,000 per violation. The cap of $5,000 is per specific violation and not per day. (6) Individual violations may be reduced or enhanced based on consideration of the history of previous violations, good-faith efforts made to correct violations promptly, and on any other consideration that justice may require. Subject to the statutory limits of $500 per day for every day a violation continues and $5,000 total per violation, a maximum enhancement of 50% per individual violation may be considered, based on the facts presented to the department. (7) Follow-up inspections may be made to confirm the status of abatement of violations. Any violation found on such follow-up inspections will be subject to an additional administrative penalty. If the first 15-day notice period has expired, that penalty will be due and a second or subsequent notice will be provided for determining second or subsequent penalty due dates. (8) Failure to file an annual Tier Two form and necessary updates with the department will be considered a violation of the Act which may not require an inspection. Other violations may be confirmed by the department through correspondence with authorized company officials and may not warrant an inspection. (9) At its option, the department may accept appropriate documentation provided by the facility as evidence of compliance status. (10) Examples of violations for the various severity levels include, but are not limited to: (A) Minor Violation-Level 1: (i) failure to include up to 10% of reportable quantity hazardous chemicals on the annual facility chemical list (Tier Two form) submitted to the department, the fire chief of the fire department having jurisdiction over the facility, or the Local Emergency Planning Committee; (ii) failure to maintain a copy of the annual facility chemical list at the facility; and (iii) failure to complete the chemical description information required for each hazardous chemical on the facility chemical list; (B) Serious Violation-Level 2: (i) failure to include up to 30% of reportable quantity hazardous chemicals on the annual facility chemical list submitted to the department, the fire chief of the fire department having jurisdiction over the facility, or the Local Emergency Planning Committee; (ii) failure to file update facility chemical list information with the department, the fire chief of the fire department having jurisdiction over the facility, or the Local Emergency Planning Committee, within 90 days after the date on which the operator begins operation or the facility exceeds the reporting threshold for a previously unreported hazardous chemical; (iii) failure to submit the appropriate annual facility chemical list filing fee to the department; (iv) failure to provide one or more material safety data sheets, on request, to the department, the fire chief of the fire department having jurisdiction over the facility, or the Local Emergency Planning Committee; (v) failure to provide to the fire chief or the Local Emergency Planning Committee additional information on types and amounts of any hazardous chemicals, when requested for emergency planning purposes; and (vi) failure to provide a copy of the facility's existing workplace chemical list, or a modified version of the most recent Tier Two form using a 500 pound threshold, to a citizen making such a request; and (C) Critical Violation-Level 3: (i) failure to include greater than 30% of reportable quantity hazardous chemicals on the annual facility chemical list submitted to the department, the fire chief of the fire department having jurisdiction over the facility, or the Local Emergency Planning Committee; (ii) failure to submit the annual facility chemical list to the department, the fire chief of the fire department having jurisdiction over the facility, or the Local Emergency Planning Committee; (iii) failure to allow a representative of the department to conduct a compliance inspection of a facility; and (iv) failure to allow the fire chief or the fire chief's representative to conduct an on-site inspection of a facility. (h) Fees. (1) The department shall charge a fee for each Tier Two form submitted under subsection (d)(3) of this section (relating to the facility chemical list). The fee must accompany the Tier Two form when submitted to the department. (2) Annual fees are based on the number of hazardous chemicals present at a facility and shall be: (A) $100 for each required submission having no more than 25 hazardous chemicals or hazardous chemical categories; (B) $200 for each required submission having no more than 50 hazardous chemicals or hazardous chemical categories; (C) $300 for each required submission having no more than 75 hazardous chemicals or hazardous chemical categories; (D) $400 for each required submission having no more than 100 hazardous chemicals or hazardous chemical categories; and (E) $500 for each required submission having more than 100 hazardous chemicals or hazardous chemical categories. (3) For the purpose of minimizing fees, the department shall provide for consolidated filing of multiple Tier Two forms for facility operators if: (A) each of the Tier Two forms contain fewer than 25 chemicals; (B) Tier Two forms are filed under the same owner or operator name and address; and (C) all consolidated Tier Two forms are mailed to the department in the same package. (4) Fees paid by mail must be paid by check or money order (cash payments are not acceptable) to the Texas Department of Health and must be addressed to: Texas Department of Health, Division of Occupational Health, Hazard Communication Branch, 1100 West 49th Street, Austin, Texas 78756. (5) No receipt will be provided for payment of fees which are mailed, but a cancelled check may be considered adequate proof of payment. (6) The department may refund a fee overpayment to an employer provided that: (A) the employer provides, in writing, proof of payment, the date(s) on which the workplace chemical list and fees were sent to or received by the department, the circumstances that caused the overpayment, and the reasons why it would have been considered an overpayment under the Act and rules in force at the time of the original filing; (B) the employer requests the refund in writing within six months of the date on which the workplace chemical list and fee were received by the department; and (C) the employer provides to the department, in the form of a refund reduction, a handling fee of $10 per refund. sec.295.182. Public Employer Community Right-To-Know. (a) Purpose and scope. (1) The purpose of these rules is to provide the public with access to information on hazardous chemicals in their communities, to enhance community awareness of chemical hazards, and facilitate community planning and response to chemical emergencies. (2) In order to avoid confusion among public employers and persons living in this state, the Texas Department of Health (department) shall implement the Public Employer Community Right-To-Know Act compatibly with the federal Emergency Planning and Community Right-To-Know Act of the United States Environmental Protection Agency (EPA). (3) These rules are applicable to operators of all facilities operated by the state or political subdivisions of the state. (b) Definitions. In addition to the terms which are defined by the Public Employer Community Right-To-Know Act, the following words, acronyms, and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise. (1) Act-The Public Employer Community Right-To-Know Act. (2) Director-The commissioner of the department. (3) EPCRA or SARA, Title III-The federal Emergency Planning and Community Right-To-Know Act, also known as the Superfund Amendments and Reauthorization Act of 1986, Title III, Public Law Number 99-499 et seq. (4) EHS or extremely hazardous substance-Any substance as defined in EPCRA, sec.302, or listed by the EPA in Title 40 Code of Federal Regulations, Part 355, Appendices A and B. (5) Workplace chemical list-A list of hazardous chemicals developed under the Texas Hazard Communication Act, sec.502.005(a). (c) Responsibility for implementation of program. The director's responsibilities under the Act are carried out through the Texas Department of Health, Division of Occupational Health, Hazard Communication Branch. Compliance documents and routine inquiries regarding this Act shall be addressed, until further notice by the director, to: Texas Department of Health, Division of Occupational Health, Hazard Communication Branch, 1100 West 49th Street, Austin, Texas 78756. (d) Facility chemical list. (1) A facility operator covered by this section shall compile and maintain a facility chemical list using the most current version of the Texas Tier Two form published by the department. The Texas Tier Two form must be typed or may be mechanically reproduced (subject to approval of the department) for all hazardous chemicals present at the facility in quantities that meet or exceed current thresholds as determined by the EPA in Title 40 Code of Federal Regulations, Part 370. (2) Facility operators shall file an annual Texas Tier Two form, accompanied by the appropriate filing fee as provided by the Act, sec.506.017(b) , with the Hazard Communication Branch no later than March 1st of each year covering the previous calendar year. A facility operator beginning operation shall file a Texas Tier Two form and the appropriate fee no later than the 90th day after the date on which the operator begins operation. The facility operator shall furnish a copy of each Texas Tier Two form to the fire chief of the fire department having jurisdiction over the facility and to the appropriate Local Emergency Planning Committee. (3) A facility operator shall file an updated Texas Tier Two form with the department not later than the 90th day after the date on which the operator has a reportable addition of a previously unreported hazardous chemical or EHS. No fee will be charged for filing this report. The facility operator shall furnish a copy of each updated Texas Tier Two form to the fire chief and to the appropriate Local Emergency Planning Committee. (4) A facility operator shall maintain in the workplace a copy of the facility's current Texas Tier Two form until such time as the facility operator files the following year's Texas Tier Two form with the department. (5) For the purpose of paperwork reduction, companies reporting multiple facilities having the same hazardous chemicals in the same reporting ranges may report those multiple facilities on the same Texas Tier Two form. Instructions for the department's policy on paperwork reduction shall be available from the Hazard Communication Branch upon request. (e) Direct citizen access to information. (1) A facility must provide within 10 working days of the date of receipt of a citizen's request under the Act, sec.506.007(a), a copy of the facility's existing workplace chemical list or a modified version of the most recent Texas Tier Two form using a 500-pound threshold. Except as otherwise provided in this section, such documents shall be furnished or mailed to the citizen requesting the information. The modified version of the most recent Tier Two form must include completed chemical description blocks for each chemical reported. (2) Any facility that has received requests equal to or in excess of those designated under the Act, sec.506.007(c), may elect to furnish the material to the department. (3) Any facility electing to furnish materials to the department must notify the department in writing, and must provide to the department copies of the requests which meet the request frequency rate specified in sec.506.007(c). The facility must inform persons making requests of the availability of the information from the department. (f) Complaints and investigations. (1) The director or his designated representative shall investigate in a timely manner a complaint relating to an alleged violation of the Act. (2) Complaints are not necessary to conduct an inspection under this section. The director or his designated representatives may enter a facility at reasonable times to conduct random compliance inspections. An employer who refuses to allow such an inspection shall be in violation of the Act. (3) The department may find multiple violations by a facility based on specific requirements of the Act. (g) Administrative penalties. (1) Inspections may be conducted by the director or his designated representative to determine if persons are in violation of the Act or the rules adopted by the Board of Health to enforce the Act. Persons found to be in violation will be notified in writing of the violation. (2) Employers found to be in violation of the Act are subject to administrative penalties not to exceed $50 per violation as authorized by the Act. Each violation will be assessed as a separate penalty. The total penalty will be the sum of all individual violation penalties. (3) A penalty shall be assessed for each day a violation continues, with a total penalty not to exceed $1,000 per violation. The cap of $1,000 is per specific violation and not per day. (4) Follow-up inspections may be made to confirm the status of abatement of violations. Any violation found on such follow-up inspections will be subject to an additional administrative penalty. If the first 15-day notice period has expired, that penalty will be due and a second or subsequent notice will be provided for determining second or subsequent penalty due dates. (5) Failure to file an annual Texas Tier Two form and necessary updates with the department will be considered a violation of the Act which may not require an inspection. Other violations may be confirmed by the department through correspondence with authorized company officials and may not warrant an inspection. (6) At its option, the department may accept appropriate documentation provided by the facility as evidence of compliance status. (h) Fees. (1) The department shall charge a fee for each Texas Tier Two form submitted under subsection (d)(2) of this section (relating to the facility chemical list). The fee must accompany the Texas Tier Two form when submitted to the department. (2) Annual fees are based on the number of hazardous chemicals present at a facility and shall be: (A) $50 for each required submission having no more than 75 hazardous chemicals; or (B) $100 for each required submission having more than 75 hazardous chemicals. (3) For the purpose of minimizing fees, the department shall provide for consolidated filing of multiple Texas Tier Two forms for facility operators if: (A) each of the Texas Tier Two forms contain fewer than 25 chemicals; (B) Texas Tier Two forms are filed under the same owner or operator name and address; and (C) all consolidated Texas Tier Two forms are mailed to the department in the same package. (4) Fees paid by mail must be paid by check or money order (cash payments are not acceptable) to the Texas Department of Health and must be addressed to: Texas Department of Health, Division of Occupational Health, Hazard Communication Branch, 1100 West 49th Street, Austin, Texas 78756. (5) No receipt will be provided for payment of the fee provided by mail, but a cancelled check may be considered adequate proof of payment. (6) The department may refund a fee overpayment to an employer provided that: (A) the employer provides, in writing, proof of payment, the date(s) on which the workplace chemical list and fees were sent to or received by the department, the circumstances that caused the overpayment, and the reasons why it would have been considered an overpayment under the Act and rules in force at the time of the original filing; (B) the employer requests the refund in writing within six months of the date on which the workplace chemical list and fee were received by the department; and (C) the employer provides to the department, in the form of a refund reduction, a handling fee of $10 per refund. sec.295.183. Nonmanufacturing Facilities Community Right-To-Know. (a) Purpose and scope. (1) The purpose of these rules is to provide the public with access to information on hazardous chemicals in their communities, to enhance community awareness of chemical hazards and facilitate community planning and response to chemical emergencies. (2) In order to avoid confusion among nonmanufacturing facilities and persons living in this state, the board shall implement the Nonmanufacturing Facilities Community Right-To-Know Act compatibly with the federal Emergency Planning and Community Right-To-Know Act of the United States Environmental Protection Agency (EPA). (3) These rules are applicable to operators of all facilities, other than those manufacturing facilities in Standard Industrial Classification (SIC) Codes 20-39 or those facilities operated by the state or political subdivisions of the state. (b) Definitions. In addition to the terms which are defined by the Nonmanufacturing Facilities Community Right-To-Know Act, the following words, acronyms, and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise. (1) Act-The Nonmanufacturing Facilities Community Right-To-Know Act. (2) Director-The commissioner of the department. (3) EPCRA or SARA, Title III-The federal Emergency Planning and Community Right-To-Know Act, also known as the Superfund Amendments and Reauthorization Act of 1986, Title III, Public Law Number 99-499 et seq. (4) EHS or extremely hazardous substance-Any substance as defined in EPCRA, sec.302, or listed by the EPA in Title 40 Code of Federal Regulations, Part 355, Appendices A and B. (5) Hazardous chemical category-group or class of hazardous chemicals with similar uses or production methods in a specified industrial process or processes which are specifically approved by the EPA to be reportable as a hazardous chemical. (c) Responsibility for implementation of program. The director's responsibilities under the Act are carried out through the Texas Department of Health, Division of Occupational Health, Hazard Communication Branch. Compliance documents and routine inquiries regarding this Act shall be addressed, until further notice by the director, to: Texas Department of Health, Division of Occupational Health, Hazard Communication Branch, 1100 West 49th Street, Austin, Texas 78756. (d) Facility chemical list. (1) A facility operator covered by this section shall compile and maintain a facility chemical list using the most current version of the Texas Tier Two Cover Sheet and Texas Tier Two Chemical Description Sheet or a federal Tier Two Emergency and Hazardous Chemical Inventory form accompanied by a Texas Tier Two Cover Sheet. For purposes of reporting hazardous chemicals at oil and gas exploration and production (standard industrial classification code 13) facilities, the API Generic Tier Two Inventory form may be substituted for the federal Tier Two Emergency and Hazardous Chemical Inventory form. If the director of the EPA approves a different generic Tier Two Inventory form, developed by another industry or group of industries, the director of the department may authorize specified industries to substitute that form for the federal Tier Two Emergency and Hazardous Chemical Inventory form. The Tier Two form must be typed or may be mechanically reproduced (subject to approval of the department), for all hazardous chemicals, hazardous chemical categories, and extremely hazardous substances present at the facility in quantities that meet or exceed current thresholds as determined by the EPA in Title 40 Code of Federal Regulations Part 370. (2) A Texas Tier Two Cover Sheet and either a Texas Tier Two Chemical Description Sheet or a federal Tier Two Emergency and Hazardous Chemical Inventory form (or API generic Tier Two inventory form, as appropriate) shall be used to comply with reporting requirements of EPCRA, sec.311 and sec.312. (3) Facility operators shall file an annual Tier Two form, accompanied by the appropriate filing fee as provided by the Act, sec.507.013(b), with the Hazard Communication Branch no later than March 1st of each year covering the previous calendar year. A facility operator beginning operation shall file a Tier Two form and the appropriate fee no later than the 90th day after the date on which the operator begins operation. The facility operator shall furnish a copy of each Tier Two form to the fire chief of the fire department having jurisdiction over the facility and to the appropriate Local Emergency Planning Committee. (4) A facility operator shall file the updated Tier Two form with the department not later than the 90th day after the date on which the operator has a reportable addition of a previously unreported hazardous chemical or EHS. No fee will be charged for filing this report. The facility operator shall furnish a copy of each updated Tier Two form to the fire chief and to the appropriate Local Emergency Planning Committee. (5) For the purpose of paperwork reduction, multiple facilities may be reported on the same tier two form, with appropriate facility identifiers, if the hazardous chemicals or hazardous chemical categories present at the multiple facilities are in the same ranges. In multiple facility reporting, the reporting thresholds must be applied to each facility rather than to the total quantities present at all facilities. (e) Complaints and investigations. (1) The director or his designated representative shall investigate in a timely manner a complaint relating to an alleged violation of the Act. (2) Complaints are not necessary to conduct an inspection under this section. The director or his designated representatives may enter a facility at reasonable times to conduct random compliance inspections. An employer who refuses to allow such an inspection shall be in violation of the Act. (3) The department may find multiple violations by a facility based on specific requirements of the Act. (f) Administrative penalties. (1) Inspections may be conducted by the director or his designated representative to determine if persons are in violation of the Act or the rules adopted by the Board of Health to enforce the Act. Persons found to be in violation will be notified in writing of the violation. (2) Employers found to be in violation of the Act are subject to administrative penalties not to exceed $50 per violation as authorized by the Act and to be administered in accordance with the procedures detailed in the Act, sec.sec.507.009-507.011. Each violation will be assessed as a separate penalty. The total penalty will be the sum of all individual violation penalties. (3) A penalty shall be assessed for each day a violation continues, with a total penalty not to exceed $1,000 per violation. The cap of $1,000 is per specific violation and not per day. (4) Follow-up inspections may be made to confirm the status of abatement of violations. Any violation found on such follow-up inspections will be subject to an additional administrative penalty. If the first 15-day notice period has expired, that penalty will be due and a second or subsequent notice will be provided for determining second or subsequent penalty due dates. (5) Failure to file an annual Tier Two form and necessary updates with the department will be considered a violation of the Act which may not require an inspection. Other violations may be confirmed by the department through correspondence with authorized company officials and may not warrant an inspection. (6) At its option, the department may accept appropriate documentation provided by the facility as evidence of compliance status. (g) Fees. (1) The department shall charge a fee for each Tier Two form submitted under subsection (d)(3) of this section (relating to the facility chemical list). The fee must accompany the Tier Two form when submitted to the department. (2) Annual fees are based on the number of hazardous chemicals present at a facility and shall be: (A) $50 for each required submission having no more than 75 hazardous chemicals or hazardous chemical categories; or (B) $100 for each required submission having more than 75 hazardous chemicals or hazardous chemical categories. (3) For the purpose of minimizing fees, the department shall provide for consolidated filing of multiple Tier Two forms for facility operators if: (A) each of the Tier Two forms contain fewer than 25 chemicals; (B) Tier Two forms are filed under the same owner or operator name and address; and (C) all consolidated Tier Two forms are mailed to the department in the same package. (4) Fees paid by mail must be paid by check or money order (cash payments are not acceptable) to the Texas Department of Health and must be addressed to: Texas Department of Health, Division of Occupational Health, Hazard Communication Branch, 1100 West 49th Street, Austin, Texas 78756. (5) No receipt will be provided for payment of fees which are mailed, but a cancelled check may be considered adequate proof of payment. (6) The department may refund a fee overpayment to an employer provided that: (A) the employer provides, in writing, proof of payment, the date(s) on which the workplace chemical list and fees were sent to or received by the department, the circumstances that caused the overpayment, and the reasons why it would have been considered an overpayment under the Act and rules in force at the time of the original filing; (B) the employer requests the refund in writing within six months of the date on which the workplace chemical list and fee were received by the department; and (C) the employer provides to the department, in the form of a refund reduction, a handling fee of $10 per refund. 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 February 2, 1994. TRD-9435552 Susan K. Steeg General Counsel Texas Department of Health Effective date: February 23, 1994 Proposal publication date: November 9, 1993 For further information, please call: (512) 834-6600 TITLE 30. ENVIRONMENTAL QUALITY Part I. Texas Natural Resource Conservation Commission Chapter 305. Consolidated Permits 30 TAC sec.305.2 The Texas Natural Resource Conservation Commission (TNRCC) adopts amendments to sec.305.2 and sec.305.69, concerning consolidated permits. Section 305.69 is adopted with changes as published in the November 23, 1993, issue of the Texas Register (18 TexReg 8640). Section 305.2 is adopted without changes to the proposed text and will not be republished. The amendments to these sections are adopted in order to conform with certain federal regulations promulgated by the United States Environmental Protection Agency (EPA) relating to corrective action under Subtitle C of the Resource Conservation and Recovery Act (RCRA). The adopted amendments relate specifically to two types of waste management units that would be used for remedial purposes under corrective action authorities: corrective action management units (CAMUs) and temporary units (TUs). The federal CAMU rule is currently being challenged in the federal courts, and if the federal rule is vacated, the TNRCC CAMU rule adopting the federal regulation by reference would no longer be effective under Title 42 United State Code, sec.3006(g)(1) and sec.3009. The commission received comments on the proposed rules from Chevron U.S.A. Inc., The Dow Chemical Company, Exxon Company, U.S.A., Greater Houston Partnership, Texas Chemical Company, and Union Carbide Chemicals and Plastics Company Inc. The commenters generally expressed their support for the adoption of these amendments. One commenter encouraged adoption of these rules as quickly as possible, in order to accelerate the cleanup of contaminated soils in a more cost-effective manner than is currently allowed, while assuring protection of human health and the environment. One commenter, while supportive of TNRCC efforts toward obtaining authorization for the regulation of CAMUs, expressed concern about the actual mechanism TNRCC would employ to allow the use of CAMUs and the time delay that may be involved. This commenter noted that the requirement to obtain a Class 3 modification for authorization to establish a CAMU could significantly delay actual start-up of a CAMU and suggested three methods which could be implemented to alleviate delay. First, the commenter suggested placing CAMU authorization in the original permit. However, as the commenter noted, most hazardous waste facilities subject to hazardous waste permitting requirements have already been issued their original hazardous waste permits. Nonetheless, the listing as a Class 3 modification of the approval of a CAMU does not appear to preclude the authorization of a CAMU in an original hazardous waste permit if remediation is necessary at the time the permit is issued. Second, the commenter suggested that the TNRCC allow the permittee to apply for a CAMU permit modification separately from the overall review of the facility's remediation activities. The Commission believes that it would not be generally prudent to allow this separation because of the significant environmental interrelationship between the designation of a CAMU and the facility's overall remediation process. Nevertheless, there may be instances where, based on a careful site-specific review of the facility's CAMU proposal and its remediation activities, the separation of the CAMU designation process from certain other corrective action review processes may be appropriate. Third, the commenter suggested that the TNRCC combine the CAMU review and approval process with the overall review of the facility remediation activities, without the need for a separate TNRCC Permit Section review. The TNRCC has two responses. First, even if the Permit Section does not conduct the review, a CAMU designation for a permitted facility is a Class 3 modification and requires the procedural protections of a Class 3 modification, particularly public participation in the CAMU designation. Second, it is beyond the scope of this rulemaking to formally respond to this comment since it relates to internal TNRCC organizational structures and practices. We appreciate the concerns of this commenter over potential delays in the CAMU approval process and will strive to address these concerns by processing the necessary permit modifications and orders as expeditiously as practicable, given other regulatory, statutory, and/or resource constraints. Another commenter suggested that a set of control procedures fully equivalent to the review and comment procedures of the Class 3 CAMU permit modification procedures and the temporary unit permit modification procedures be considered for application to non-RCRA sites. In response, the TNRCC points out that, except for nonhazardous waste contamination which may fall within the scope of the definition of "remediation wastes," the proposed amendments did not include regulation of nonhazardous waste sites. Indeed, certain statutory provisions (i.e., Texas Solid Waste Disposal Act, Health and Safety Code, sec.361.090) do not allow the permitting of certain types of non-RCRA waste activities, such as certain on-site nonhazardous industrial solid waste activities, and consequently, the TNRCC is precluded from requiring permits for these types of activities or imposing procedures fully equivalent to the review and comment procedures inherent in the above-referenced permit modification procedures. In response to this commenter with regard to any non-RCRA sites which are already subject to industrial solid waste permitting requirements and subject to 30 TAC sec.306.69 (relating to Solid Waste Permit Modification at the Request of the Permittee), the permit modification procedures would be applicable if requested by the permittee, and if the remediation wastes at these sites meet the definition of "remediation wastes." However, to consider applying procedures fully equivalent to the permit modification procedures of these adopted amendments for wastes which do not meet the definition of "remediation wastes" is beyond the scope of this rulemaking. Nevertheless, such consideration may be subject to future rulemaking activities if warranted. This commenter also pointed out a typographical error under proposed sec.305. 69(i)(N), correctly noting that the "N" should be an "M." The adopted amendments reflect this change, so that the adopted section is sec.305.69(i)(M). The amended sections are adopted under the Texas Water Code, sec.5.103 and sec.5.105, which provides the Texas Natural Resource Conservation Commission with the authority to adopt any rules necessary to carry out its powers and duties under the Texas Water Code and other laws of the State of Texas, and to establish and approve all general policy of the commission. 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 February 1, 1994. TRD-9435504 Mary Ruth Holder Director, Legal Services Texas Natural Resource Conservation Commission Effective date: February 22, 1994 Proposal publication date: November 23, 1993 For further information, please call: (512) 239-6087 Subchapter D. Amendments, Renewals, Transfers, Corrections, Revocation, and Suspension of Permits 30 TAC sec.305.69 The amended section is adopted under the Texas Water Code, sec.sec.5.103, 5. 105, and 26.011, which give the commission the authority to adopt any rules necessary to carry out its powers, duties, and policies and to protect water quality in the state. The sections are also adopted under the Solid Waste Disposal Act, sec.3 and sec.4, which gives the commission the authority to regulate industrial solid wastes and hazardous municipal wastes and to adopt rules and promulgate rules consistent with the general intent and purposes of the Act. sec.305.69. Solid Waste Permit Modification at the Request of the Permittee. (a)-(g) (No change.) (h) Newly regulated wastes and units. (1)-(2) (No change.) (i) Appendix I. The following appendix will be used for the purposes of Subchapter D which relate to solid waste permit modification at the request of the permittee. [graphic] 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 February 1, 1994. TRD-9435505 Mary Ruth Holder Director, Legal Services Texas Natural Resource Conservation Commission Effective date: February 22, 1994 Proposal publication date: November 23, 1993 For further information, please call: (512) 239-6087 Chapter 335. Industrial Solid Waste and Municipal Hazardous Waste The Texas Natural Resource Conservation Commission (TNRCC) adopts amendments to sec.335.1 under Subchapter A (relating to Industrial Solid Waste and Municipal Hazardous Waste Management in General), sec.335.111 under Subchapter E (relating to Interim Standards for Owners and Operators of Hazardous Waste Storage, Processing, or Disposal Facilities), sec.sec.335.151, 335. 152, and 335.167 under Subchapter F (relating to Permitting Standards for Owners and Operators of Hazardous Waste Storage, Processing, or Disposal Facilities), and sec.335.431 under Subchapter O (relating to Land Disposal Restrictions). Section 335.152 is adopted with changes to the proposed text as published in the November 23, 1993, issue of the Texas Register (18 TexReg 8655). Sections 335.1, 335.111, 335.151, and 335.167, are adopted without changes and will not be republished. Section 335.431 is adopted without changes to the proposed text as published in the November 26, 1993, issue of the Texas Register (18 TexReg 8770) and will not be republished. The amendments to these sections are adopted to conform with certain federal regulations promulgated by the United States Environmental Protection Agency (EPA) relating to corrective action under Subtitle C of the Resource Conservation and Recovery Act (RCRA). The adopted amendments relate specifically to two types of waste management units that will be used for remedial purposes under corrective action authorities: corrective action management units (CAMUs) and temporary units (TUs). The federal CAMU rule is currently being challenged in the federal courts, and, if the federal rule is vacated, the TNRCC CAMU rule adopting the federal regulation by reference would no longer be effective under Title 42 United States Code, sec.3006(g)(1) and sec.3009. The commission received comments on the proposed rules from Chevron U.S.A. Inc., The Dow Chemical Company, Exxon Company, U.S.A., Greater Houston Partnership, Texas Chemical Company, and Union Carbide Chemicals and Plastics Company Inc. The commenters generally expressed their support for the adoption of these amendments. One commenter encouraged adoption of these rules as quickly as possible, in order to accelerate the cleanup of contaminated soils in a more cost-effective manner than is currently allowed, while assuring protection of human health and the environment. One commenter suggested that the TNRCC consider the possibility of utilizing the CAMU and TU concepts at non-RCRA sites. In response, the TNRCC points out that, except for nonhazardous waste contamination which may fall within the scope of the definition of "remediation wastes," the proposed amendments did not include regulation of nonhazardous waste sites. Indeed, certain statutory provisions (i.e., Texas Solid Waste Disposal Act, Health and Safety Code, sec.361.090) do not allow the permitting of certain types of non-RCRA waste activities, such as certain on-site nonhazardous industrial solid waste activities, and consequently, the TNRCC is precluded from requiring permits for these types of activities. To consider requirements along the lines of the CAMU and TU concepts at non-RCRA sites, where no wastes exist which meet the definition of "remediation wastes," is beyond the scope of the current rulemaking. Section 335.152 is adopted with two formatting changes. First, sec.335.152(c) , which describes changes to the adopted regulations, is reformatted so that individual changes are listed separately. Second, the last sentence of sec.335. 152(c), which gave the location of copies of the federal regulations that are adopted by reference, is moved to sec.335.152(d). Also, the address of the TNRCC library is changed to indicate its new location. At the time of adoption, the library is the process of moving from its present location in the basement of the Stephen F. Austin building to its future location on the first floor of the new TNRCC offices at 12100 Park 35 Circle, Building A. Subchapter A. Industrial Solid Waste and Municipal Hazardous Waste Management In General 30 TAC sec.335.1 The amended section is adopted under the Texas Water Code, sec.sec.5.103, 5. 105, and 26.011, which provides the commission with authority to adopt any rules necessary to carry out its powers, duties, and policies and to protect water quality in the state. The sections are also promulgated under the Texas Health and Safety Code, Texas Solid Waste Disposal Act, sec.361.017 and sec.361. 024, which provides the commission the authority to regulate industrial solid wastes and hazardous municipal wastes and to adopt and promulgate rules consistent with the general intent and purposes of the 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 February 1, 1994. TRD-9435506 Mary Ruth Holder Director, Legal Services Texas Natural Resource Conservation Commission Effective date: February 22, 1994 Proposal publication date: November 23, 1993 For further information, please call: (512) 239-6087 Subchapter E. Interim Standards for Owners and Operators of Hazardous Waste Storage, Processing, or Disposal Facilities 30 TAC sec.335.111 The amended section is adopted the under the Texas Water Code, sec.5.103 and sec.5.105 (Vernon 1988), which authorizes the Texas Natural Resource Conservation Commission to promulgate rules necessary to carry out the powers and duties under the provisions of the Texas Water Code and other laws of this state, and pursuant to the Texas Health and Safety Code sec.361.017 and sec.361. 024 (Vernon 1992), which further authorizes the Texas Natural Resource Conservation Commission to promulgate rules necessary to manage industrial solid and municipal hazardous wastes. 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 February 1, 1994. TRD-9435507 Mary Ruth Holder Director, Legal Services Texas Natural Resource Conservation Commission Effective date: February 22, 1994 Proposal publication date: November 23, 1993 For further information, please call: (512) 239-6087 Subchapter F. Permitting Standards for Owners and Operator of Hazardous Waste Storage, Processing, or Disposal Facilities 30 TAC sec.sec.335.151, 335.152, 335.167 The amended sections are adopted under the Texas Water Code sec.5.103 and sec.5.105 (Vernon 1988), which authorizes the Texas Natural Resource Conservation Commission to promulgate rules necessary to carry out the powers and duties under the provisions of the Texas Water Code and other laws of this state, and pursuant to the Texas Health and Safety Code, sec.361.017 and sec.361. 024 (Vernon 1993), which further authorizes the Texas Natural Resource Conservation Commission to promulgate rules necessary to manage industrial solid and municipal hazardous wastes. sec.335.152. Standards. (a) The following regulations contained in 40 Code of Federal Regulations Part 264 (including all appendices to Part 264), are adopted by reference as amended and adopted in the Code of Federal Regulations through June 1, 1990 (see 55 FedReg 22685) and as further amended and adopted as indicated in each paragraph of this section: (1) -(13) (No change.) (14) Subpart S-Corrective Action for Solid Waste Management Units (as amended through February 16, 1993 at 58 FedReg 8683) ; (15) Subpart W-Drip Pads (as amended through December 24, 1992 at 57 Federal Regulations 61492); (16) Subpart X-Miscellaneous Units. (17) Subpart AA-Air Emission Standards for Process Vents (as amended through April 26, 1991 at 56 FedReg 19290); (18) Subpart BB-Air Emission Standards for Equipment Leaks (as amended through April 26, 1991 at 56 FedReg 19290). (b) (No change). (c) The regulations of the Environmental Protection Agency that are adopted by reference in this section are adopted subject to the following changes. (1) The term "regional administrator" is changed to the "executive director" of the Texas Natural Resource Conservation Commission or to the commission, consistent with the organization of the commission as set out in the Texas Water Code, Chapter 5, Subchapter B. (2) The term "treatment" is changed to "processing." (3) References to sec.3008(h) of the Resource Conservation and Recovery Act are changed to the Texas Solid Waste Disposal Act, Texas Health and Safety Code (Vernon Pamphlet 1993), sec.361.303 (relating to Corrective Action). (4) References to 40 Code of Federal Regulations sec. sec.260.10, 264.90, 264.101, 270.41, or 270.42, are changed to sec.335.1 of this title (relating to Definitions), sec.335.156 of this title (relating to Applicability of Groundwater Monitoring and Response), sec.335.167 of this title (relating to Corrective Action for Solid Waste Management Units), sec.305.62 of this title (relating to Amendment), or sec.305. 69 of this title (relating to Solid Waste Permit Modification at the Request of the Permittee), respectively. (5) References to 40 Code of Federal Regulations Part 264 Subpart F are changed to sec.335.156 of this title (relating to Applicability of Groundwater Monitoring and Response), sec.335.157 of this title (relating to Required Programs), sec.335.158 of this title (relating to Groundwater Protection Standard), sec.335.159 of this title (relating to Hazardous Constituents), sec.335.160 of this title (relating to Concentration Limits), sec.335.161 of this title (relating to Point of Compliance), sec.335.162 of this title (relating to Compliance Period), sec.335. 163 of this title (relating to General Groundwater Monitoring Requirements), sec.335.164 of this title relating to Detection Monitoring Program). Section 335.165 of this title (relating to Compliance Monitoring Program), sec.335.166 of this title (relating to Corrective Action Program), and sec.335.167 of this title (relating to Corrective Action for Solid Waste Management Units). (6) References to 40 Code of Federal Regulations Part 265 Subpart F are changed to include sec.335.116 of this title (relating Applicability of Groundwater Monitoring Requirements) and sec.335.117 of this title (relating to Recordkeeping and Reporting), in addition to the reference to 40 Code of Federal Regulations Part 265 Subpart F, except sec.265.90 and sec.265.94. (7) References to the EPA are changed to the Texas Natural Resource Conservation Commission. (d) A copy of 40 Code of Federal Regulations Part 264 is available for inspection at the library of the Texas Natural Resource Conservation Commission, located on the first floor of Building A at 12100 Park 35 Circle, Austin, Texas. 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 February 1, 1994. TRD-9435508 Mary Ruth Holder Director, Legal Services Texas Natural Resource Conservation Commission Effective date: February 22, 1994 Proposal publication date: November 23, 1993 For further information, please call: (512) 239-6087 Subchapter O. Land Disposal Restrictions 30 TAC sec.335.431 The amended section is adopted under the Texas Water Code, sec.sec.5.103, 5. 105, and 26.011, which provides the commission with authority to adopt any rules necessary to carry out its powers, duties, and policies and to protect water quality in the state. The sections are also promulgated under the Texas Health and Safety Code, Texas Solid Waste Disposal Act, sec.361.017 and sec.361. 024, which provides the commission the authority to regulate industrial solid wastes and hazardous municipal wastes and to adopt and promulgate rules consistent with the general intent and purposes of the 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 February 1, 1994. TRD-9435509 Mary Ruth Holder Director, Legal Services Texas Natural Resource Conservation Commission Effective date: February 22, 1994 Proposal publication date: November 26, 1993 For further information, please call: (512) 239-6087