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 10. COMMUNITY DEVELOPMENT PART V. Texas Department of Economic Development CHAPTER 190.Procedures of the Board 10 TAC sec.sec.190.1-190.8 The Texas Department of Economic Development (Department) adopts the repeal of sec.sec.190.1-190.8, concerning the Procedures of the Board, without changes to the proposed text, as published in the December 26, 1997, issue of the Texas Register (22 TexReg 12643). The repeal is necessary to accurately reflect current law and to allow the adoption of new rules. Senate Bill 932 of the 75th Legislature, which abolished the Texas Department of Commerce and created the Texas Department of Economic Development, also abolished the Texas Department of Commerce policy board and created a new governing board for the Department. Chapter 190 applies to procedures of the board for the Texas Department of Commerce policy board that no longer exists. No comments were received regarding the repeal. The rules are repealed under the authority of sec.481.0044(a) of the Texas Government Code, which authorizes the Department to promulgate rules necessary for the administration of department programs and may adopt rules for its internal management and control, and the Administrative Procedure Act, Texas Government Code, Chapter 2001, which prescribes the standards for agency rulemaking. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 17, 1998. TRD-9802128 W. Lane Lanford Chief Administrative Officer Texas Department of Economic Development Effective date: February 4, 1998 Proposal publication date: December 26, 1997 For further information, please call: (512) 936-0181 10 TAC sec.sec.190.1-190.7 The Texas Department of Economic Development (Department) adopts new sec.sec.190.1-190.7, concerning setting forth procedures for the Department's governing board. Sections 190.2, 190.3, and 190.6 are adopted with changes to the proposed text as published in the December 26, 1997, issue of the Texas Register (22 TexReg 12645). Sections 190.1, 190.4, 190.5, and 190.7, are adopted without changes and will not be republished. The new rules are being adopted because Senate Bill 932, which abolished the Texas Department of Commerce and established the Department, also abolished the Texas Department of Commerce policy board and established a new governing board for the Department. Rules of procedure previously adopted for the policy board needed to be replaced by rules for the new governing board. The changes made to sec.sec.190.2, 190.3, and 190.6 in the final rules are primarily minor word changes made for accuracy and clarity. Section 190.3(2) was rewritten to more accurately reflect the process used to appoint the board of directors and elect the officers of the TEXCAP Financing Corporation. No comments were received regarding the adoption of the new sections. Section 190.1, Definitions, sets forth definitions of terms used throughout the proposed rules. Section 190.2, Officers and sec.190.3, Ex Officio Duties; Officers, identify the officers of the governing board, their ex officio director duties on other Department boards, and the officers to be elected to those boards. Section 190.4, Committees, sets forth procedures for establishing standing, advisory, and special committees to assist the governing board. Section 190.5, Personnel, provides for delegation of duties and provision of administrative and professional support to the governing board. Section 190.6, Meetings, sets forth the process for persons who desire to make public appearances and public comments before the governing board. In addition, the section provides a contact for meeting accessibility accommodations. Section 190.7, Communication and complaints; access to Department programs, sets forth the process for registering complaints with the governing board and additional access provisions. The new rules are adopted pursuant to Government Code, sec.481.0044(a), which authorizes the board to adopt rules for administration of the department and for its internal management and control, and the Administrative Procedure Act, Government Code, Chapter 2001, Subchapter B, Rulemaking, which sets forth the agency rulemaking process. sec.190.2.Officers. (a) Chairman. The presiding officer as designated by the governor serves as the chairman of the Board. The chairman will preside at all meetings of the board. The chairman shall have the duty to generally direct, supervise, or control the business of the board and shall exercise such supervisory duties as may be required or given to him by the board from time to time. (b) Vice chairman. The vice chairman of the board shall have such powers and duties as may be assigned to him by the chairman and shall exercise the powers of the chairman during any time that the chairman is absent or unable to act. (c) Secretary. The secretary or his designee shall keep, or cause to be kept, the minutes of all meetings and a record of all actions of the governing board, and he or she shall attend to the giving and serving of all notices. sec.190.3.Ex Officio Duties; Officers. (a) The members of the board shall serve ex officio as the directors of the following nonprofit corporations: (1) The members of the board serve ex officio as the board of directors of the Texas Small Business Industrial Development Corporation. (A) The board of directors shall appoint the officers of TSBIDC by majority vote. (B) The officers shall consist of a president, vice president, secretary, and treasurer. (C) One person may serve as both secretary and treasurer. (D) Members of the board, employees of the department, or any other individuals deemed qualified by the board may be appointed as officers of TSBIDC. (2) The board of directors of TSBIDC shall appoint the board of directors of TEXCAP by majority vote. (A) The board of directors of TEXCAP shall elect officers by majority vote. (B) The officers shall consist of a president, vice president, secretary, and treasurer, in accordance with the by-laws of the corporation. (C) Members of the board, employees of the department, or any other individuals deemed qualified by the board may be appointed as officers of TEXCAP. (3) The members of the board shall serve ex officio as the Board of Directors of the Texas Economic Development Corporation. (A) The board shall appoint the officers of TEDC by majority vote. (B) The officers shall consist of a president, vice president, secretary, and treasurer. (C) The president of the board shall serve as the president of TEDC. (D) The vice chair of the board shall serve as the vice president of TEDC. (E) The secretary of the board shall serve as the secretary of TEDC. (F) The treasurer of TEDC shall be elected from the remaining board members. (b) The corporations' directors and officers shall receive no compensation for their services. They may receive reimbursement for actual and necessary travel expenses, subject to any applicable limitation on reimbursement provided by the General Appropriations Act or other law, if and when deemed advisable and feasible by the board. sec.190.6.Meetings. (a) Public appearances at board meetings. Members of the public may appear before the board regarding any issue under the board's jurisdiction. (1) Any person or organization wishing to be placed on the board meeting agenda must provide a written statement of such request. The request must identify the name of the presenter(s)and the topic of discussion desired to be discussed, and must be delivered to the chairman at the department's headquarters, 1700 N. Congress Avenue, Suite 130, Austin, Texas 78701, or mailed to the department at P.O. Box 12728, Austin, Texas 78711-2728, or faxed to the department at (512) 936-0303. The request must include a contact person's name, mailing address, telephone number, and fax number, if available. (2) Within 30 days after receipt of the request, the requestor will be notified of the time and place of the next board meeting for which the requestor can be placed on the agenda and the amount of time scheduled for the requestor's presentation. (b) Public comment on scheduled agenda items. Member of the public may comment on scheduled agenda items as determined by the board, consistent with the Texas Open Meetings Act. (1) The board agenda shall consist of agenda items prepared by department staff and approved by the chairman. Agenda items shall be filed with the Secretary of State's Office prior to board meetings in accordance with the Act. (2) The board agenda shall include time for public comments whenever possible. Members of the public who wish to speak on a scheduled board agenda item must complete a comment sheet, identifying the presenter and the item to be addressed, prior to board discussion on the item. Comment sheets will be available to members of the public prior to and during board meetings. (3) The chairman will recognize the presenter at the point in the agenda where the comments are most relevant and may determine an appropriate amount of time for the presentation. The board may further limit presentations at any time in accordance with the Act. (c) Meeting accessibility. Any disabled or non-English speaking person who requires assistance in order to attend a board meeting will be reasonably accommodated whenever possible. Any person requiring an accommodation must contact the Board Coordinator at department headquarters as set out in subsection (a)(1) of this section. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 17, 1998. TRD-9802127 W. Lane Lanford Chief Administrative Officer Texas Department of Economic Development Effective date: February 4, 1998 Proposal publication date: December 26, 1997 For further information, please call: (512) 936-0181 TITLE 16. ECONOMIC REGULATION PART I. Railroad Commission of Texas CHAPTER 9.Liquefied Petroleum Gas Division SUBCHAPTER A.General Applicability and Requirements 16 TAC sec.9.2, sec.9.15 The Railroad Commission of Texas adopts amendments to sec.9.2 and sec.9.15, relating to definitions, and registration and transfer of LP-gas transports or container delivery units, without changes to the versions published in the December 19, 1997, issue of the Texas Register (22 TexReg 12372). The amendments clarify the fees required to be paid to the commission and other requirements to initially register or to transfer registration of LP-gas transports or other described vehicles for use in Texas. Specifically, the adopted amendments to sec.9.2 add definitions for the terms "container delivery unit," "operator," "register" (or "registration"), and "transfer;" the adopted definitions clarify some terms which are used in the Commission's rules. Adopted amendments to sec.9.15(c) clarify the requirements of the table in subsection (e) by adding more explanation in new paragraphs (1) through (4) of the requirements for the various types of units, and explain how the registration fee will be calculated. The adopted transfer fee (previously called a reregistration fee) in sec.9.15(d) is changed from a prorated amount based on $156 or $108, depending on the size of the unit, to a flat fee of $50. This fee is being changed because it will no longer be prorated, and will still comply with the commission's statutory authority in Texas Natural Resources Code, sec.113.131. The substantive adopted amendments to the table in subsection (e) increase the registration fee for LP-gas transports with 3,500 gallons or less aggregate water capacity, commonly known as bobtails, from $96 to $108. The fee increase is necessary to comply with the commission's statutory authority in Texas Natural Resources Code, sec.113.131, regarding registration of LP-gas transports, which requires the registration fee be at least $100. The amount of $108 was chosen to keep the increase at a minimum and because it is divisible by 12, which is necessary for easy administration of the commission's staggered license and registration renewal system. In addition, the aggregate water capacity which identifies transports and bobtails has been changed from the current split at 5,000 gallons aggregate water capacity to 3,500. This change is being adopted to make Commission rules consistent with 49 Code of Federal Regulations, Parts 171 - 180, which are being adopted for adoption by the Commission in a separate rulemaking. The lowering of this gallonage will require a few more transports to pay the higher fee ($156 versus $108); however, commission records show only about 13 such units will be affected. Adopted amendments in sec.9.15(g) change the commission's inspection schedule from once every four fiscal years to once every five years to more accurately reflect the commission's practices and to correspond with the time period required for testing of containers, as specified in sec.9.1753 of this title (relating to testing requirements). Other adopted nonsubstantive amendments include changes in wording, punctuation, or organization to provide clarity. The Commission received no comments regarding the adopted amendments. The amendments are adopted under Texas Natural Resources Code, sec.113.051, which authorizes the commission to adopt rules relating to any and all aspects or phases of the LP-gas industry that will protect or tend to protect the health, welfare, and safety of the general public, and sec.113.131, which authorizes the commission to establish registration and transfer fees for LP-gas transports and other described vehicles. The Texas Natural Resources Code, sec.113.051 and sec.113.131, are affected by the adopted amendments. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10 1998. TRD-9801968 Mary Ross McDonald Deputy General Counsel, Office of General Counsel Railroad Commission of Texas Effective date: March 2, 1998 Proposal publication date: December 19, 1997 For further information, please call: (512) 463-7008 16 TAC sec.sec.9.20-9.22, 9.29 The Railroad Commission of Texas adopts amendments to sec.sec.9.20, 9.21, 9.22, and 9.29, relating to filings required for stationary LP-gas installations; notice of stationary LP-gas installations; objections to proposed stationary LP- gas installations; and application for an exception to a safety rule, without changes to the versions published in the November 21, 1997, issue of the Texas Register (22 TexReg 11197). The commission adopts these amendments to clarify the requirements for plats or drawings filed with plans and specifications, to specify a cap on the aggregate water capacity an LP-gas installation may reach without further notice to property owners, and to clarify deadlines for filing objections to proposed LP- gas installations. Specifically, adopted amendments to sec.9.20(a)(1) add the new explanation for plats or drawings, and a reference to these is added to subsection (e)(1). The addition of the 250-foot diameter in subsection (a)(1)(B) will ensure that the commission receives plats or drawings that accurately represent the proposed LP-gas installation. The adopted amendments to sec.9.21 add a cap of 120,000 gallons aggregate water capacity for existing LP-gas installations before notice must be provided to real property owners. An existing LP- gas installation may increase its aggregate water capacity up to 120,000 gallons without having to provide notice to real property owners. Additions to existing installations which will result in an aggregate water capacity of more than 120,000 gallons will require notice as specified in sec.9.21(a). Other adopted amendments in sec.9.22 regard the time period for mailing objections. The current rule requires objections to be mailed to the commission within 18 days of receipt of the notice of the proposed installation; the adopted amendment specifies the objection period to be 18 calendar days from the postmark of the mailed notice. This change should allow the commission to proceed with its review and approval process of a proposed installation more expeditiously, while still providing adequate time for real property owners to respond. In addition, new subsections (b), (c), and (d) explain the commission's responsibilities in reviewing objections. Subsection (d) also contains a limit on the number and type of objections that real property owners may file. This will assist in the submission of valid objections and prevent LP-gas applications from being suspended indefinitely while repeated and possibly invalid objections are filed. A similar amendment in sec.9.29(d)(1) concerns objections to an application for an exception to a safety rule. Again, the commission adopts changing the time period for objections from 18 days from receipt to 18 calendar days from the postmark date. Other nonsubstantive amendments include changes in wording, punctuation, or organization to provide better clarity. The Commission received no comments regarding the adopted amendments. The amendments are adopted under the Texas Natural Resources Code, sec.113.051, which authorizes the commission to adopt rules relating to any and all aspects or phases of the LP-gas industry that will protect or tend to protect the health, welfare, and safety of the general public. The Texas Natural Resources Code, sec.113.051, is affected by the adopted amendments. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10 1998. TRD-9801969 Mary Ross McDonald Deputy General Counsel, Office of General Counsel Railroad Commission of Texas Effective date: March 2, 1998 Proposal publication date: November 21, 1997 For further information, please call: (512) 463-7008 PART IX. Texas Lottery Commission CHAPTER 401.Administration of the State Lottery Act SUBCHAPTER D.Lottery Game Rules 16 TAC sec.401.311 The Texas Lottery Commission adopts new sec.401.311, concerning on-line game rules relating to a new on-line game, "Texas Million", with changes to the proposed text as published in the January 2, 1998 issue of the Texas Register (23 Tex Reg 37). The new section is adopted to provide specific game details and requirements for the new on-line game "Texas Million". The introduction of a new on-line game will generate interest and excitement for lottery players as well as attract new lottery players. As a result, "Texas Million" will generate additional revenue to the State of Texas through increased ticket sales. Staff has recommended some changes to clarify and facilitate the game. The changes are minimal and listed as follows: Subsection (b)(1) is changed to reflect the numbers 0 through 99 inclusive as opposed to 00 through 99 inclusive. Subsection (b)(4) is changed to reflect the numbers 0 through 99 instead of 00 through 99. Subsection (d)(1) is changed to reflect the numbers 0 through 99 instead of 00 through 99. Staff recommends these changes because the numbers 0 through 9 are easier to read as single digit numbers. Subsection (h)(1) is changed to reflect a drawing time between 9:58 p.m. Central Time and 10:00 p.m. Central Time instead of a 9:58 p.m. Central Time drawing time. Staff recommends this change to allow flexibility to aid staff in consolidating all game drawings to one minute and thereby receive more press coverage of the drawings. No oral or written comments were received regarding adoption of the new section. The new section is adopted under Texas Government Code, sec.466.016, which provides the Texas Lottery Commission with the authority to adopt rules governing the type of lottery games to be conducted and pursuant to the Administrative Procedure Act, Texas Government Code, sec.2001.004 sec.401.311."Texas Million" On-Line Game Rule. (a) Texas Million. A Texas Lottery on-line game to be known as 'Texas Million' is authorized to be conducted by the executive director under the following rules and under such further instructions and directives that may issue in furtherance thereof. If a conflict arises between this section and sec.401.301 of this title (relating to Lottery Game Rules (General Definitions)) or between this section and sec.401.304 of this title (relating to On-Line Game Rules (General)), this section shall have precedence. (b) Definitions. In addition to the definitions provided in sec.401.301 and sec.401.304 of this title, and unless the context in this section otherwise requires, the following definitions listed in paragraphs (1)-(6) of this subsection apply. (1) Number - Any play integer from 0 through 99 inclusive. (2) Play - The seven sets of four numbers printed on the ticket. The player can select only the first set of the seven sets of four numbers for the 'million dollar prize'. The terminal will randomly select the remaining six sets of four numbers. The player can also have the terminal randomly select all seven sets of four numbers. (3) Multi Draw - A player may purchase a Texas Million ticket for up to ten consecutive drawings beginning with the current draw period. (4) Play Board - A field of numbers from 0 through 99 found on the playslip. Each playslip has three play boards on it. (5) Playslip- An optically readable card issued by the Texas Lottery used by players of Texas Million to select plays. There shall be three play boards on each playslip identified as Game 1, Game 2, and Game 3. (6) A playslip has no pecuniary value and shall not constitute evidence of ticket purchase or of numbers selected. (c) Price of ticket. The price of each Texas Million play shall be $2.00. A player may purchase up to three plays on one playslip. A player may also select the Multi Draw feature. (d) Play for Texas Million. (1) Type of play. A Texas Million player must select one set of four numbers from 0 through 99 for the million dollar cash prize, or select the Quick Pick option. The on-line terminal will randomly select the other six sets of four numbers for other cash prizes. The seven sets of four numbers are divided into three groups. The first group has one set of four numbers, the second group of numbers has two sets of four numbers, and the third group has four sets of four numbers. A winning play is achieved only when two, three or four numbers in one or more of the seven sets of four numbers selected by the player match, in any order, with the four winning numbers drawn by the Texas Lottery. Each set of four numbers is a separate set which must match with the four winning numbers drawn by the Texas Lottery. (2) Method of play. The player will use playslips to make number selections for the first set of four numbers. The other six sets of four numbers will be selected by a random number generator operated by the computer, referred to as Quick Pick. The on-line terminal will read the playslip and issue ticket(s) with corresponding plays. If a playslip is not available, the on-line retailer may enter the selected numbers via the keyboard. However, the retailer shall not accept telephone or mail-in requests to manually enter selected numbers. If offered by the lottery, the player may also choose the Quick Pick feature and have the random number generator operated by the on-line terminal randomly select all seven sets of four numbers. (3) Multiple prizes. The total number of prizes that can be won from one play is seven. The holder of a winning ticket may win only one prize for each set of four numbers and shall only be entitled to the highest prize category won by the set of four numbers. (e) Prizes for Texas Million. (1) Prize amounts. At the discretion of the executive director, a prize amount may be altered temporarily for marketing or promotional purposes. This temporary alteration of the prize amount will be announced in advance of ticket sales for the affected draw. Prize amounts are a guaranteed amount except in the situation where more than ten prizes are won in the first prize group in a single drawing wherein the prize in the first prize group becomes pari-mutuel for a total prize value of $10,000,000. Otherwise, each Texas Million player who matches two, three or four numbers in any one set of four numbers per play will be guaranteed a set prize amount as follows: Figure 1: 16 TAC sec.401.311(e)(1) (2) Prize pool. The prize pool for Texas Million prizes shall be 50% of Texas Million sales for each drawing. The amount of actual prizes won may vary since most prize amounts are guaranteed. (3) Prize categories. (A) First Prize consists of matching all four numbers in the first group of numbers with the winning numbers. This prize must be claimed at the Austin claim center. (B) Second Prize consists of matching all four numbers in either one of the two sets of four numbers in the second group of numbers with the winning numbers. (C) Third Prize consists of matching all four numbers in any one of the four sets of four numbers in the third group of numbers with the winning numbers. (D) Fourth Prize consists of matching any three numbers in any one of the seven sets of four numbers on the ticket with the winning numbers, excluding any situation where a First, Second or Third prize has already been won for that set of four numbers. (E) Fifth Prize consists of matching any two numbers in any one of the seven sets of four numbers on the ticket with the winning numbers, excluding any situation where a First, Second, Third or Fourth prize has already been won for that set of four numbers. (4) Prize reserve fund. The prize reserve fund may be increased or decreased depending on amounts won by winners as compared to the appropriate percentage of the prize pool. The prize reserve fund may be decreased by any amounts won by winners, due to the guaranteed prize amounts. For example, money may be allocated from the prize reserve fund to the Texas Million prize pool if the prize liability is greater than the 50% prize pool for that drawing. The prize reserve fund will also increase or decrease depending upon the number of times the First Prize is won. If the First Prize of a guaranteed $1,000,000 is not won after each drawing, the amount of money in that prize pool will be designated to the prize reserve fund. If multiple winners claim the First Prize of a guaranteed $1,000,000, the additional million dollar prize money will come from the prize reserve fund, up to ten First Prizes, where upon the First Prize becomes pari-mutuel on a value of $10,000,000. The pari-mutuel prize amount shall be calculated by dividing the prize category contributions of the First Prize pool for that drawing, plus prize reserve monies up to $10,000,000, by the number of shares for the prize category. (5) Unclaimed prize fund. In the event any player who has a valid winning ticket does not claim the prize within 180 days after the drawing in which the prize was won, the prize amount shall be added to the unclaimed prize fund and all rights to the prize shall terminate. (f) Odds of winning. The following table shown in this subsection sets forth the odds of winning and guaranteed prizes in each prize category, based upon the total number of possible combinations of matching 2, 3 or 4 numbers in one set of four numbers per play. The overall odds of winning are 1:20. Figure 2: 16 TAC sec.401.311(f) (g) Ticket purchases. (1) Texas Million tickets may be purchased only at a licensed location from a lottery retailer authorized by the director to sell on-line tickets. (2) Texas Million tickets shall show the player's selection of numbers and numbers selected by Quick Pick, play amount, drawing date(s), validation and reference numbers. (3) It shall be the exclusive responsibility of the player to verify the accuracy of the player's selection(s), draw date(s) and other data printed on the ticket. A ticket is a bearer instrument until signed. (4) Except as provided in subsection (d)(2) of this section, Texas Million tickets must be purchased using official Texas Million playslips. Playslips which have been mechanically completed are not valid. Texas Million tickets must be printed on official Texas Lottery on-line game paper stock and purchased at a licensed location through an authorized Texas Lottery retailer's on-line terminal. (h) Drawings. (1) The Texas Million drawing shall be held every Friday evening between 9:58 p.m. Central Time and 10:00 p.m. Central Time except that the drawing schedule may be changed by the executive director, if necessary. (2) Texas Million tickets will not be sold from 9:45 p.m. Central Time to 10:00 p.m. Central Time on drawing days. (3) The drawings will be conducted by Texas Lottery officials. (4) Each drawing shall determine, at random, four winning numbers in accordance with Texas Million drawing procedures. Any numbers drawn are not declared winning numbers until the drawing is certified by the lottery in accordance with the drawing procedures. The winning numbers shall be used in determining all Texas Million winners for that drawing. (5) Each drawing shall be witnessed by an independent certified public accountant. All drawing equipment used shall be examined by at least one lottery security representative, the drawing supervisor, and the independent certified public accountant immediately prior to a drawing and immediately after a drawing. (6) A drawing will not be invalidated based on the financial liability of the lottery. (i) Announcement of retailer incentive or bonus program. The director shall announce each retailer incentive or bonus program prior to its commencement. The announcement shall specify the beginning and ending time, if applicable, of the incentive or bonus program and the value of the award(s). This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 13, 1998. TRD-9802219 Kimberly L. Kiplin General Counsel Texas Lottery Commission Effective date: March 5, 1998 Proposal publication date: January 2, 1998 For further information, please call: (512) 344-5113 CHAPTER 402.Bingo Regulation and Tax 16 TAC 402.544, 402.550, 402.552, 402.553, 402.557, 402.560-402.562, 402.564, 402.566 The Texas Lottery Commission adopts the repeal of sec.sec.402.544, 402.550, 402.552, 402.553, 402.557, 402.560-402.562, 402.564, and 402.566, concerning bingo regulation and tax without changes to the proposed text as published in the January 2, 1998, issue of the Texas Register (23 TexReg 38) and will not be republished. The repeal of these sections is necessary to remove these sections from the Texas Administrative Code since the sections have expired by operation of law on April 1, 1995. No oral or written comments were received regarding adoption of the repeals. The repeals are adopted under authority of Texas Revised Civil Statutes, Article 179d, sec.sec.16(a) and (d), and under Texas Government Code, sec.467.102, which provide the Texas Lottery Commission with the authority to adopt rules for the enforcement and administration of the Bingo Enabling Act and pursuant to the Administrative Procedure Act, Texas Government Code, sec.2001.004. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 13, 1998. TRD-9802220 Kimberly L. Kiplin General Counsel Texas Lottery Commission Effective date: March 5, 1998 Proposal publication date: January 2, 1998 For further information, please call: (512) 344-5113 TITLE 19. EDUCATION PART I. Texas Higher Education Coordinating Board CHAPTER 13.Financial Planning SUBCHAPTER F.Tuition Rebates for Certain Undergradutes 19 TAC sec.sec.13.91-13.98 The Texas Higher Education Coordinating Board adopts Chapter 13, new Subchapter F, sec.sec.13.91-13.98, concerning Tuition Rebates For Certain Undergraduates with changes to the proposed text as published in the December 5, 1997 issue of the Texas Register (22 TexReg 11919). Changes were made to sec.sec.13.91, 13.93, 13.94, 13.96, and 13.97(d). The amendments are being adopted to provide rebates to undergraduate students who complete their studies with a minimum of "excess" courses. The purpose of the change is to encourage students to complete their studies in a timely, efficient manner. Comments were received from the University of Texas-Health Science Center at Houston. They asked that we clarify the fact that students earning baccalaureate degrees at the health science center would not be eligible for these rebates. As a result of that comment, changes were made to indicate that "general academic institutions" are required to offer the rebates rather than the previous wording that referred to universities. In addition, members of a committee of the Texas Association of Collegiate Registrars and Admissions Officers assembled to provide advice related to the transcript rule made two verbal suggestions: Some community colleges may not be able to offer students 12 credits in a given semester because they do not offer that many courses that would apply to a university degree; and some universities do not make graduation effective until 30 days after the formal graduation ceremony in order to allow time for all graduation checks. Changes were made accordingly from these comments. The new rules are adopted under Texas Education Code, sec.54.0065 which provides the Texas Higher Education Coordinating Board with the authority to adopt rules concerning Tuition Rebates For Certain Undergraduates. sec.13.91.Purpose. The purpose of this program is to provide tuition rebates that will provide a financial incentive for students to prepare for university studies while completing their high school work, avail themselves of academic counseling, make early career decisions, and complete their baccalaureate studies with as few courses outside the degree plan as possible. Minimizing the number of courses taken by students results in financial savings to students, parents, and the state. sec.13.93. Eligible Students. To be eligible for rebates under this program, students must meet all of the following conditions: (1) they must have enrolled for the first time in an institution of higher education in the fall 1997 semester or later, (2) they must be requesting a rebate for work related to a first baccalaureate degree received from a Texas public university, (3) they must have been a resident of Texas, must have attempted all coursework at a Texas public institution of higher education, and have been entitled to pay resident tuition at all times while pursuing the degree, and (4) they must have attempted no more than three hours in excess of the minimum number of semester credit hours required to complete the degree under the catalog under which they were graduated. Hours attempted include transfer credits, course credit earned exclusively by examination, courses that are dropped after the official census date, for-credit developmental courses, optional internship and cooperative education courses, and repeated exclusively by examination, courses that are dropped after the official census date, for- credit developmental courses, optional internship and cooperative education courses, and repeated courses. Courses dropped for reasons that are determined by the institution to be totally beyond the control of the student shall not be counted. sec.13.94.Affected Institutions. (a) All Texas public baccalaureate-granting general academic universities are required to offer rebates to eligible students. (b) All Texas public institutions of higher education are required to notify students of the existence of the tuition rebate program and provide course enrollment opportunities (see sec.13.96 of this title) (relating to Tuition Rebates for Certain Undergraduates). sec.13.96.Responsibilities of Institutions. Affected institutions have the following responsibilities associated with this program: (1) All Texas public institutions of higher education, including community and technical colleges, shall notify first-time freshman students of the tuition rebate program. A notice in the institution's official catalog is one acceptable form of notice. (2) If requested by potentially eligible students, public institutions of higher education are required to provide these students opportunities to enroll during each fall and spring semester in the equivalent of at least 12 semester credit hours that apply toward their degrees. Institutions are not required to provide students with the opportunity to enroll in specific courses or specific sections. Community and Technical Colleges will comply to the extent that courses for the current semester are being offered that apply to the student's university degree program. The requirement may be met by allowing substitutions for required courses or by allowing concurrent enrollment in courses from another institution, so long as the courses are taught on the students' home campus and the student incurs no financial penalty. (3) Texas public universities are required to provide students with appropriate forms and instructions for requesting tuition reimbursement at the time that students apply for baccalaureate degrees. (4) Institutions are required to provide tuition rebates to students who apply for them within 60 days after graduation or provide the student with a statement explaining the reason the student is ineligible for the rebate. (5) Institutions are required to provide a dispute resolution process to resolve disputes related to local administration of the program. (6) Disputes related to lower division credit transfer should be resolved in accordance with Coordinating Board rules, Chapter 5, sec.5.393 of this title (relating to Transfer of Lower Division Course Credit). (7) Institutions may adopt rules and regulations for administering the program. For example, institutions may require students to declare their intent to qualify for a tuition rebate early in their careers or register prior to the beginning of the semester. sec.13.97.Responsibilities of Students. (a) Students desiring to qualify for tuition rebates are responsible for complying with all university rules and regulations related to administration of the program. (b) Students desiring to qualify for tuition rebates are solely responsible for enrolling only in courses that will qualify them for the rebates. (c) A student who has transferred from another institution of higher education is responsible for providing to the institution awarding the degree official transcripts from all institutions attended by the student. (d) Students must apply for rebates prior to receiving their baccalaureate degrees on forms provided by the institution and must keep the institution apprized of their addresses for at least 60 days after their graduation date. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 13, 1998. TRD-9802162 James McWhorter Assistant Commissioner for Administration Texas Higher Education Coordinating Board Effective date: March 5, 1998 Proposal publication date: December 5, 1997 For further information, please call: (512) 483-6162 CHAPTER 17.Campus Planning SUBCHAPTER A.Criteria for Approval of New Construction and Major Repair and Rehabilitation 19 TAC sec.17.32 The Texas Higher Education Coordinating Board adopts an amendment to Chapter 17, Subchapter A, sec.17.32, concerning Criteria for Approval of New Construction and Major Repair and Rehabilitation (Assessment of Needs for Instructional and Research Equipment) without changes to the proposed text as published in the December 5, 1997, issue of the Texas Register (22 TexReg 11921). The amendment is being adopted to reflect the change in university formula funding allocations whereby appropriations for operation and maintenance of facilities are based on the Coordinating Board Space Projection Model rather than actual square feet in buildings. No comments were received concerning the adoption of the amendment. The amendment is adopted under Texas Education Code, sec.61.058 which provides the Texas Higher Education Coordinating Board with the authority to adopt rules concerning Criteria for Approval of New Construction and Major Repair and Rehabilitation (Assessment of Needs for Instructional and Research Equipment). This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 13, 1998. TRD-9801974 James McWhorter Assistant Commissioner for Administration Texas Higher Education Coordinating Board Effective date: March 5, 1998 Proposal publication date: December 5, 1997 For further information, please call: (512) 483-6162 SUBCHAPTER B.Applications for Approval of New Construction and Major Repair and Rehabilitation 19 TAC sec.17.42 The Texas Higher Education Coordinating Board adopts an amendment to Chapter 17, Subchapter B, sec.17.42, concerning Application for Approval of new Construction and Major Repair and Rehabilitation (Application for Project Approval) without changes to the proposed text as published in the December 5, 1997, issue of the Texas Register (22 TexReg 11921). The amendments are being adopted to reflect the change in university formula funding allocations whereby appropriations for operation and maintenance of facilities are based on the Coordinating Board Space Projection Model rather than actual square feet in buildings. No comments were received concerning the adoption of the amendment. The amendment is adopted under Texas Education Code, sec.61.058, which provides the Texas Higher Education Coordinating Board with the authority to adopt rules concerning Application for Approval of new Construction and Major Repair and Rehabilitation (Application for Project Approval). This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 11, 1998. TRD-9801975 James McWhorter Assistant Commissioner for Administration Texas Higher Education Coordinating Board Effective date: March 3, 1998 Proposal publication date: December 5, 1997 For further information, please call: (512) 483-6162 SUBCHAPTER C.Requesting Coordinating Board Endorsement of Real Property Acquisitions 19 TAC sec.17.66, sec.17.68 The Texas Higher Education Coordinating Board adopts amendments to Chapter 17, Subchapter C, sec.17.66 and sec.17.68, concerning Requesting Coordinating Board Endorsement of Real Property Acquisitions with changes to the proposed text as published in the December 5, 1997, issue of the Texas Register (22 TexReg 11922). Changes were made to sec.17.68. The amendments are being adopted to reflect the change in university formula funding allocations whereby appropriations for operation and maintenance of facilities are based on the Coordinating Board Space Projection Model rather than actual square feet in buildings. Comments were received from University of Texas Southwestern Medical Center at Dallas, University of Texas Health Science Center at Houston, and Texas State Technical College at Waco regarding leased or rented real property, that the rule should be amended to exclude clinical and research space from requiring Board approval. The agency agreed with the comments from UT-Southwestern Medical Center and UT Health Science Center at Houston and changes were made accordingly. The comments from TSTC-Waco did not specifically refer to the rule change. The concern was for the legislative change to fund public university appropriations based on the Space Projection Model, and the effect that might have if applied to Texas State Technical Colleges. The staff believed that the proposed rule change would, in the long run, affect appropriations to TSTC only to a small degree. The amendments are adopted under Texas Education Code, sec.61.058, which provides the Texas Higher Education Coordinating Board with the authority to adopt rules concerning Requesting Coordinating Board Endorsement of Real Property Acquisitions. sec.17.68.Leased or Rented Real Property. The Coordinating Board shall review for approval any improved real property whose use is obtained by rental or lease whenever an institution seeks to place the property on its educational and general facilities inventory, if the property contains at least 3,000 square feet of educational and general space. The application for approval shall be submitted at least 60 days prior to the meeting at which the request is to be considered. The Board's authority does not apply to leased or rented real property acquisitions for clinical or research facilities. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 11, 1998. TRD-9801976 James McWhorter Assistant Commissioner for Administration Texas Higher Education Coordinating Board Effective date: March 3, 1998 Proposal publication date: December 5, 1997 For further information, please call: (512) 483-6162 TITLE 22. EXAMINING BOARDS PART IV. Texas Cosmetology Commission CHAPTER 89.General Rules and Regulations 22 TAC sec.89.8, sec.89.13 The Texas Cosmetology Commission adopts new section sec.89.8, concerning student registration without changes to the proposed text as published in the October 31, 1997, issue of the Texas Register (22 TexReg 10611), and adopts amendments to section sec.89.13, concerning reducing, increasing or withholding of hours without changes to the proposed text as published in the October 24, 1997, issue of the Texas Register (22 TexReg 10491). The new section is adopted to require schools to send in student registrations within 10 days of enrollment and the amendment is adopted to allow schools authority to clock students out for disciplinary reasons. No comments were received regarding the adoption of the new and amended sections. The amendment and new sections are adopted under Texas Civil Statutes, Article 8451a, sec.22, which provides the commission with the authority to issue rules consistent with this Act after a public hearing and to protect the public's health and safety. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9801928 Delores Alspaugh Interim Executive Director Texas Cosmetology Commission Effective date: March 2, 1998 Proposal publication date: October 31, 1997 For further information, please call: (512) 454-4674 PART IX. Texas State Board of Medical Examiners CHAPTER 163.Licensure 22 TAC sec.163.1, sec.163.8 The Texas State Board of Medical Examiners adopts amendments to sec.163.1 and sec.163.8, concerning definitions and administration of examinations, without changes to the proposed text as published in the January 2, 1998, issue of the Texas Register (23 TexReg 41) and will not be republished. The amendments are adopted to ensure that all examination requirements are consistent and equal. One comment was received from the American Osteopathic Association. The comment was not specifically related to the amendment that was proposed because it dealt with the name of an organization which had changed its name. This change will be handled in a future amendment. The amendments are adopted under the Medical Practice Act, Texas Civil Statutes, Article 4495b, sec.2.09(a), which provides the Texas State Board of Medical Examiners with the authority to make rules, regulations and bylaws not inconsistent with this Act as may be necessary for the governing of its own proceedings, the performance of its duties, the regulation of the practice of medicine in this state, and the enforcement of this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9802100 Bruce A. Levy, M.D., J.D. Executive Director Texas State Board of Medical Examiners Effective date: March 4, 1998 Proposal publication date: January 2, 1998 For further information, please call: (512) 305-7016 CHAPTER 166.Physician Registration 22 TAC sec.166.2 The Texas State Board of Medical Examiners adopts an amendment to sec.166.2, concerning continuing medical education, without changes to the proposed text as published in the January 2, 1998, issue of the Texas Register (23 TexReg 44) and will not be republished. The amendment will clarify that continuing medical education courses recognized by the Committee for Review and Recognition of the Accreditation Council for Continuing Medical Education and sponsored by state medical societies, meet the Texas State Board of Medical Examiners' requirements for continuing medical education for license renewal. No comments were received regarding adoption of the amendment. The amendment is adopted under the Medical Practice Act, Texas Civil Statutes, Article 4495b, sec.2.09(a), which provides the Texas State Board of Medical Examiners with the authority to make rules, regulations and bylaws not inconsistent with this Act as may be necessary for the governing of its own proceedings, the performance of its duties, the regulation of the practice of medicine in this state, and the enforcement of this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9802099 Bruce A. Levy, M.D., J.D. Executive Director Texas State Board of Medical Examiners Effective date: March 4, 1998 Proposal publication date: January 2, 1998 For further information, please call: (512) 305-7016 CHAPTER 171.Institutional Permits 22 TAC sec.171.9 The Texas State Board of Medical Examiners adopts an amendment to sec.171.9, concerning faculty temporary license, without changes to the proposed text as published in the January 2, 1998, issue of the Texas Register (23 TexReg 44) and will not be republished. The amendment will ensure that medical school faculty who would not be eligible for an unrestricted physician license, as outlined in Chapter 163 of this title (relating to Licensure) would also not be eligible for a faculty temporary license. No comments were received regarding adoption of the amendment. The amendment is adopted under the Medical Practice Act, Texas Civil Statutes, Article 4495b, sec.2.09(a), which provides the Texas State Board of Medical Examiners with the authority to make rules, regulations and bylaws not inconsistent with this Act as may be necessary for the governing of its own proceedings, the performance of its duties, the regulation of the practice of medicine in this state, and the enforcement of this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9802101 Bruce A. Levy, M.D., J.D. Executive Director Texas State Board of Medical Examiners Effective date: March 4, 1998 Proposal publication date: January 2, 1998 For further information, please call: (512) 305-7016 CHAPTER 175.Schedule of Fees and Penalties 22 TAC sec.175.1, sec.175.2 The Texas State Board of Medical Examiners adopts amendments to sec.175.1 and sec.175.2, concerning fees and penalties, without changes to the proposed text as published in the January 2, 1998, issue of the Texas Register (23 TexReg 45) and will not be republished. The amendments to sec.175.1 outline fees for processing an application for acudetox specialists and annual renewal of acudetox specialists; fees for approval of continuing acupuncture and acudetox acupuncture education courses. The amendments to sec.175.2 outline penalty fees for renewal of non-certified radiologic technician's registration expired for 1- 90 days. No comments were received regarding adoption of the amendments. The amendments are adopted under the Medical Practice Act, Texas Civil Statutes, Article 4495(b), sec.2.09(a) which provides the Texas State Board of Medical Examiners with the authority to make rules, regulations, and bylaws not inconsistent with this Act as may be necessary for the governing of its own proceedings, the performance of its duties, the regulation of the practice of medicine in this state, and the enforcement of this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9802102 Bruce A. Levy, M.D., J.D. Executive Director Texas State Board of Medical Examiners Effective date: March 4, 1998 Proposal publication date: January 2, 1998 For further information, please call: (512) 305-7016 CHAPTER 181.Contact Lens Prescriptions 22 LTALC sec.sec.181.1-181.7 The Texas State Board of Medical Examiners adopts new sec.sec.181.1-181.7, concerning contact lens prescriptions, without changes to the proposed text as published in the January 2, 1998, issue of the Texas Register (23 TexReg 45) The new rules were also adopted on an emergency basis in the January 2, 1998, issue of the Texas Register (23 TexReg 15). The rules will not be republished. New chapter 181 is mandated by the 75th Legislature through the Texas Contact Lens Prescription Act, Chapter 1345. The new chapter is adopted in order to set forth the criteria under which a patient may request and receive a contact lens prescription and under which a physician shall provide such prescription. No comments were received regarding adoption of the new rules. The new sections are adopted under the Medical Practice Act, Texas Civil Statutes, Article 4495b sec.2.09(a), which provides the Texas State Board of Medical Examiners with the authority to make rules, regulations and bylaws not inconsistent with this Act as may be necessary for the governing of its own proceedings, the performance of its duties, the regulation of the practice of medicine in this state, and the enforcement of this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9802103 Bruce A. Levy, M.D., J.D. Executive Director Texas State Board of Medical Examiners Effective date: March 4, 1998 Proposal publication date: January 2, 1998 For further information, please call: (512) 305-7016 CHAPTER 183.Acupuncture 22 TAC sec.183.17 The Texas State Board of Medical Examiners adopts the repeal of sec.183.17 and new sec.183.17 and sec.183.23, concerning acupuncture, without changes to the proposed text as published in the January 2, 1998, issue of the Texas Register (23 TexReg 46). The repeal and new sections were also adopted on an emergency basis in the January 2, 1998, issue of the Texas Register (23 TexReg 17). The rules will not be republished. The repeal and new sections are as a result of Senate Bill 1765, 75th Legislature, which requires the Board of Medical Examiners to certify acudetox specialists, annually renew certification, and monitor continuing education for these registrants. No comments were received regarding adoption of the repeal and new sections. The repeal is adopted under the Medical Practice Act, Texas Civil Statutes, Article 4495b, sec.2.09(a), which provides the Texas State Board of Medical Examiners with the authority to make rules, regulations and bylaws not inconsistent with this Act as may be necessary for the governing of its own proceedings, the performance of its duties, the regulation of the practice of medicine in this state, and the enforcement of this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 12, 1998. TRD-9802104 Bruce A. Levy, M.D., J.D. Executive Director Texas State Board of Medical Examiners Effective date: March 4, 1998 Proposal publication date: January 2, 1998 For further information, please call: (512) 305-7016 22 TAC sec.183.17, sec.183.23 The new sections are adopted under the Medical Practice Act, Texas Civil Statutes, Article 4495b, sec.2.09(a), which provides the Texas State Board of Medical Examiners with the authority to make rules, regulations and bylaws not inconsistent with this Act as may be necessary for the governing of its own proceedings, the performance of its duties, the regulation of the practice of medicine in this state, and the enforcement of this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9802105 Bruce A. Levy, M.D., J.D. Executive Director Texas State Board of Medical Examiners Effective date: March 4, 1998 Proposal publication date: January 2, 1998 For further information, please call: (512) 305-7016 PART XXX. State Board of Examiners of Professional Counselors CHAPTER 681.Professional Counselors The Texas State Board of Examiners of Professional Counselors (the board), by majority vote of the board on December 13, 1997, enters this order finally adopting sec.sec.681.64, 681.81, 681.82, 681.92, and 681.94 concerning the licensing and regulation of professional counselors. Sections 681.81, 681.82, 681.92 and 681.94 are adopted with changes to the proposed text as published in the October 31, 1997, issue of the Texas Register (22 TexReg 10613). Section 681.64 is adopted without changes, and therefore this section will not be republished. The amendments cover academic course content, temporary license requirements, experience requirements (internship), requirements for examination and examination failures. The amendments are necessary to implement legislative amendments to Texas Civil Statutes, Article 4512g (the Licensed Professional Counselor Act) which increased the supervised experience requirements from 24 months or 2,000 clock hours to 36 months or 3,000 clock hours and to delete the language relating to an application for examination. No comments were received, however the staff made the following changes due to staff comments for clarification to board rules. Change: Concerning sec.681.81(g)(2), the word "an" was deleted and "The Texas State Professional Counselor" was inserted in its place. Change: Concerning sec.681.82(k)(2), the section number and section title referenced was incorrect, and "sec.681.64(c) of this title (relating to Academic Course Content)" was deleted and "sec.681.63(c) of this title (Academic Requirements)" was inserted. Change: Concerning sec.681.82(g), "September 1, 1992" was deleted and "October 2, 1996" was inserted. The required semester hours were changed from "45" to "48" to accommodate changes in the Act. Also "before beginning the supervised experience" was deleted and the phrase "and hold a temporary license from the board" was inserted. Change: Concerning sec.681.82(i), the subsection was proposed as one sentence, and has now been divided into two sentences for clarification. Change: Concerning sec.681.92(b), "Required Application Material" was deleted and "General" was was inserted to reflect the correct section title for sec.681.51. Change: Concerning sec.681.94(c) and (d), the order of (c) and (d) were reversed for a more sequential flow. Also the word "apply" was deleted and "reapply" was inserted in its place. SUBCHAPTER E.Academic Requirements for Examination and Licensure 22 TAC sec.681.64 The amendment is adopted under the Licensed Professional Counselor Act, Texas Civil Statutes, Article 4512g, sec.6, which provides the Texas State Board of Examiners of Professional Counselors with the authority to adopt and revise rules that are necessary to administer the Licensed Professional Counselor Act and sec.14(p) relating to rules concerning temporary licenses. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9801963 Anthony P. Picchioni, Ph.D. Chairperson State Board of Examiners of Professional Counselors Effective date: March 2, 1998 Proposal publication date: October 31, 1997 For further information, please call: (512) 458-7236 SUBCHAPTER F.Experience Requirements for Examination and Licensure 22 TAC sec.sec.681.81, 681.82 The amendments are adopted under the Licensed Professional Counselor Act, Texas Civil Statutes, Article 4512g, sec.6, which provides the Texas State Board of Examiners of Professional Counselors with the authority to adopt and revise rules that are necessary to administer the Licensed Professional Counselor Act and sec.14(p) relating to rules concerning temporary licenses. sec.681.81. Temporary License. (a)-(f) (No change.) (g) An LPC intern who holds a temporary license may obtain a regular license by: (1) submitting a supervised experience documentation form documenting successful completion of the required hours of supervised experience in accordance with sec.681.52(c) of this title (relating to Required Application Materials) and sec.681.82 of this title (relating to Experience Requirements (Internship)); and (2) successfully completing The Texas State Professional Counselor examination for licensure in accordance with Subchapter G of this chapter (relating to Licensure Examinations). sec.681.82. Experience Requirements (Internship). (a) Applicants for licensure must have completed a supervised experience acceptable to the Texas State Board of Examiners of Professional Counselors (board) based on the following: (1) persons who were admitted to a counselor preparation program designed to obtain a graduate degree in counseling or related fields prior to September 1, 1997, must complete 24 months or 2,000 clock-hours of supervised counseling experience; or (2) persons who are admitted to a counselor preparation program designed to obtain a graduate degree in counseling or related fields after September 1, 1997, must complete 36 months or 3,000 clock hours of supervised counseling experience. (b) The supervised experience must include at least 1,000 hours of direct client counseling contact for persons accumulating 2,000 hours and 1,500 hours of direct client counseling contact for persons accumulating 3,000 hours. (c) An applicant must complete: (1) the required 2,000 clock-hours of supervised experience in a time period of no fewer than 12 months; or (2) the required 3,000 clock-hours of supervised experience in a time period of no fewer than 18 months. (d) The 12 or 18 month time period shall not be decreased by excess practicum hours that are applied toward the supervised experience hours. (e) If applying under the 24-month requirement or the 36 month requirement, the applicant must average at least 20 clock-hours per week of practice. (f) The internship must have been after completion of a: (1) graduate degree in counseling or a related field; and (2) a planned graduate program in counseling or its substantial equivalent of at least 48 semester hours. (g) The applicant who began to accumulate supervised experience on or after October 2, 1996, must have completed at least 48 graduate semester hours in counseling or a related field and hold a temporary license from the board. (h) The experience must have consisted primarily of the provision of direct counseling services within a professional relationship to individuals or groups by using a combination of mental health and human development principles, methods, and techniques to achieve the mental, emotional, physical, social, moral, educational, spiritual, or career-related development and adjustment of the client throughout the client's life. (i) The applicant must have received direct supervision consisting of a minimum of one hour a week of face-to-face supervision in individual or group settings. No more than one half of the total hours of supervision having been received in group supervision. (j) The experience must have been under the direction of a board approved supervisor. (k) The board may count excess practicum hours toward the experience requirements of this subchapter if: (1) the hours were part of the applicant's academic practicum or internship accumulated after the commencement of the applicant's planned graduate program; (2) the hours are in excess of the 300-hour practicum required by sec.681.63(c) of this title (relating to Academic Requirements); and (3) the hours to be counted are not more than 400 hours. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9801964 Anthony P. Picchioni, Ph. D. Chairperson State Board of Examiners of Professional Counselors Effective date: March 2, 1998 Proposal publication date: October 31, 1997 For further information, please call: (512) 458-7236 SUBCHAPTER G.Licensure Examinations 22 TAC sec.sec.681.92, 681.94 The amendments are adopted under the Licensed Professional Counselor Act, Texas Civil Statutes, Article 4512g, sec.6, which provides the Texas State Board of Examiners of Professional Counselors with the authority to adopt and revise rules that are necessary to administer the Licensed Professional Counselor Act and sec.14(p) relating to rules concerning temporary licenses. sec.681.92. Requirements for Licensure Examination. (a) LPC interns must submit a supervised experience documentation form documenting successful completion of the required supervised experience in accordance with sec.681.52(c) of this title (relating to Required Application Materials). (b) Applicants for a regular license that do not hold a temporary license must apply for licensure in accordance with sec.681.51 of this title (relating to General) and sec.681.52 of this title. (c) The Texas State Board of Examiners of Professional Counselors (board) shall provide written notification to persons who meet all requirements for examination. sec.681.94. Failures. (a)-(b) (No change.) (c) The temporary license of a person who fails any two successive examinations shall be voided. (d) A person who fails any two successive examinations may not reapply for a regular license until two years have elapsed from the date of the last examination or until the person has completed nine graduate semester-hours in the applicant's weakest portions of the examination. An application for licensure must be submitted in accordance with sec.681.51 of this title (relating to General) and sec.681.52 of this title (relating to Required Application Materials). This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9801965 Anthony P. Picchionnni, Ph.D. Chairperson State Board of Examiners of Professional Counselors Effective date: March 2, 1998 Proposal publication date: October 31, 1997 For further information, please call: (512) 458-7236 TITLE 25. HEALTH SERVICES PART I. Texas Department of Health CHAPTER 29.Purchased Health Services SUBCHAPTER D.Medicaid Home Health Services 25 TAC sec.29.302 On behalf of the State Medicaid Director, the Texas Department of Health (department) submits by federal mandate an adopted amendment to sec.29.302, concerning provider participation requirements for home health services providers. This amendment is a federal mandate required by sec.4724, Title IV of the Balanced Budget Act of 1997. The section as amended adds surety bond requirements to the home health services provider participation requirements. Home health agencies and durable medical equipment providers must provide the department a surety bond in the same form specified by the Secretary of Health and Human Services for Medicare home health services. The amendment complies with the federal mandate contained in sec.4724, Title IV of the Balanced Budget Act of 1997, to be effective January 1, 1998. Although this amendment will be effective January 1, 1998, it will not be implemented until the Health Care Financing Administration finalizes its federal regulations requiring surety bonds for home health services providers. The amendment is adopted under the Human Resources Code, sec.32.021 and Government Code, sec.531.021, which provide the Health and Human Services Commission with the authority to adopt rules to administer the state's medical assistance program and is submitted by the Texas Department of Health under its agreement with the Health and Human Services Commission to operate the purchased health services program and as authorized under Chapter 15, sec.1.07, Acts of the 72nd Legislature, First Called Session (1991). sec.29.302. Provider Participation Requirements. (a) - (b) (No change.) (c) Surety bond requirements. To participate in the Texas Medicaid Program's home health services, providers must provide the department with a surety bond in the form specified by the Secretary of the Department of Health and Human Services (Secretary). The amount of the surety bond must be no less than $50,000 or an amount comparable to that specified by the Secretary for home health services providers in the Medicare program. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 9, 1998. TRD-9801857 Susan K. Steeg General Counsel Texas Department of Health Effective date: January 1, 1998 Proposal publication date: N/A For further information, please call: (512) 458-7236 CHAPTER 97.Communicable Diseases Control of Communicable Diseases 25 TAC sec.sec.97.1-97.5 The Texas Department of Health (department), by majority vote of the Texas Board of Health (board) on February 8, 1998, enters this order finally adopting amendments to sec.sec.97.1-97.5, concerning control of communicable diseases. Sections 97.1, 97.3, 97.4, and 97.5, are adopted with changes to the proposed text as published in the September 26, 1997, issue of the Texas Register (22 TexReg 9595) as a result of comments received during the 30 day comment period. Section 97.2 is adopted without changes to the proposed text and will not be republished. Specifically, the sections clarify definitions, what to report, when to report, who shall report, and where to report. The amendments add and delete diseases to the list of reportable diseases. Significant amendments to sec.97.1 through sec.97.5 concern the reporting of antibiotic resistant bacteria. The optimism of the antibiotic era that began 50 years ago is waning. Even before the widespread use of penicillin in the late 1940s, resistance was detected in both gram-positive and gram-negative organisms. Within one year of methicillin's introduction in 1960, methicillin resistant strains of Staphylococcus aureus emerged. In recent years Streptococcus pneumoniae, which accounts for 3,000 cases of meningitis and 7,000,000 cases of otitis media nationwide annually, has developed resistant strains. With the recent emergence of vancomycin resistant Enterococcus species and the potential for vancomycin resistant Staphylococcus aureus, an event which would make all current antibiotics ineffective for these diseases, the need to determine the intrastate distribution of resistant isolates of Staphylococcus aureus, Streptococcus pneumoniae, and Enterococcus species has become urgent. A first step toward curtailing the pernicious progression of antibiotic resistance involves increasing the medical community's awareness of the problem. This is best accomplished by providing health care providers with timely surveillance data detailing the incidence of resistant organisms in their communities. In parts of the United States, resistance rates have recently risen dramatically. Because antibiotic resistant organisms significantly affect antibiotic use and health care costs, data are needed to assess the problem, plan appropriate intervention strategies, and alleviate the clinical and economic burden of these diseases. Additional revisions address other emerging disease threats. For instance, an increased incidence of Creutzfeldt-Jakob Disease (CJD) has been noted in northeast Texas. This fatal disease, characterized by a rapidly progressive dementia accompanied by severe muscle spasms and incoordination is now thought to be caused by a transmissible agent. The revised list also includes yersiniosis, an emerging bacterial disease which can cause serious gastrointestinal illness and may sometimes lead to unnecessary surgery. Making these conditions reportable will result in better case ascertainment, allowing the department to identify risk factors and possible control measures. It has recently been recognized that several closely related organisms can cause the same disease. Rocky Mountain spotted fever (RMSF) needs to be changed to "spotted fever group rickettsioses" because several different microorganisms (rickettsia) can cause RMSF-like illnesses. Invasive group A streptococcal disease needs to be changed to "invasive streptococcal disease" since more than one Streptococcus species, and not just group A, can cause invasive disease. Because it has not contributed to a public health response, reporting of tuberculosis infection in persons less than 15 years of age is being deleted. Tuberculosis disease which is active and potentially infectious remains reportable for all age groups. Changes have been made to the proposed text in response to comments received during the comment period. The details of the changes are described in the summary of comments that follow. Other minor editorial changes were made for clarification. The following comments were received concerning the proposed sections. Following each comment is the department's response and any resulting changes(s). Comment: Ten commenters were concerned about sec.97.3(c)(6) and asked that the department drop reporting of quarterly numeric totals for "all Enterococcus species, all Streptococcus pneumoniae, all Haemophilus influenzae..." Response: The department agrees with the reviewers' request to have the reporting of Haemophilus influenzae isolates dropped from these proposed rules. However, individual cases of invasive Haemophilus influenzae type b, a vaccine preventable disease, will still remain reportable as listed in sec.97.3(b)(1). The department disagrees with the reviewers' request to drop reporting of quarterly numeric totals for Enterococcus species and Streptococcus pneumoniae. Resistant strains of both of these pathogens are important causes of morbidity; quarterly numeric totals are needed to calculate resistance rates for these pathogens. Comment: Ten commenters were concerned that sec.97.3(c)(6) would not "secure a risk-stratified denominator to provide multiple resistant organism rates for comparison in Texas." Various commenters suggested that the rate generated "as proposed" would be inaccurate, possibly misleading, greatly skewed, and would not provide useful rates. Response: The department agrees with the commenters that the data the department wishes to collect cannot be used to calculate a "risk-stratified denominator." The department's goal is to calculate antibiotic resistance rates for specific pathogens by geographic area. No change was made as a result of this comment. Comment: Regarding sec.97.3(c)(6) ten commenters suggested that the department "...concentrate on accurate numerator reporting to create reports based on patient days." Another commenter suggested that "...the denominator which is commonly used for other reportable diseases could be used to calculate incidence of each multiple resistant organism per 100,000 population." Response: The department disagrees with the suggestions to concentrate on the numerator and to calculate rates based on census data (population) or patient days. Traditionally numerator data alone are regarded as being of little value. Numerator and denominator data that are used to calculate rates should come from the same group. Having a denominator based on the population in a geographic area would not be appropriate. In this case, the numerator and denominator used to calculate the rates should be numbers of bacterial isolates, not patients. The department also wishes to point out that laboratories do not normally have easy access to information about patient days. No change was made as a result of this comment. Comment: Concerning sec.97.3(c)(6), fourteen commenters stated that collecting denominator data would be "labor intensive" for laboratories and that this activity would detract from accurate reporting of true multiple resistant organism occurrences. Several commenters suggested that this requirement would draw resources away from other activities. Response: The department agrees with the commenters that reporting, in general, requires time and additional work for the individuals reporting. The department believes that monitoring trends of resistant organisms is critical to the health of Texas citizens. One large laboratory in central Texas used a popular laboratory information system to obtain the proposed data for a two month period this effort required five minutes. While the department understands that other laboratories may have less efficient computer systems, based on information from a large teaching hospital, it should take large laboratories less than one hour per month to collect the data. Although some small laboratories may need to hand tabulate the data, they should have far fewer isolates to review and report. No change was made as a result of this comment. Comment: Concerning sec.97.3(c)(6), eight commenters were concerned that the cost to collect denominator data was underestimated. They suggested the department "...weigh the cost of this reporting against the value to be gained from this nonspecific data collection." One commenter estimated the cost of manual recording at "...15-30 minutes per day at a salary of $12.00 per hour." Another commenter concerned about unfunded mandates suggested the department provide their own personnel to visit facilities and collect this data." Response: The department disagrees. As explained above we believe the time required to report should not exceed one hour per month. Many commenters thought that they were being asked to identify and delete duplicates, further speciate isolates, or perform additional antibiotic susceptibility testing. It is not the department's intention to impose any of these additional costs/duties on laboratories. In parts of the United States in which resistance rates have been longitudinally monitored, these rates have recently risen dramatically. The department feels that one hour of laboratory time per month will be necessary to evaluate the impact of emerging antibiotic resistance in Texas. Because antibiotic resistant organisms significantly affect antibiotic use and health care costs, data are needed to assess the problem and plan appropriate intervention strategies. No change was made as a result of this comment. Comment: Two commenters were concerned that there is no differentiation between infection or colonization. This comment was concerning the rules regarding reporting of antibiotic resistant organisms in general. Response: The department agrees that the rules do not differentiate between infection and colonization. These rates are intended to be a measure of incidence of antibiotic resistance in isolates not a measure of infection or colonization. No change was made as a result of this comment. Comment: Five commenters were concerned that in sec.97.3(c)(6) there is no control for duplicates. Response: The department agrees that duplicates are likely to be reported. However, asking laboratory staff to delete duplicates would impose an excessive burden on laboratories. The department will use its own staff to remove duplicates of resistant organisms from the numerator and the denominator. The department understands that the denominator data will be less than perfect and will have some duplication of nonresistant organisms. Nevertheless the data should be adequate for following temporal and geographic trends in antibiotic resistance. No change was made as a result of this comment. Comment: Concerning sec.97.4(a) one commenter pointed out that submission of pure cultures of vancomycin resistant coagulase negative Staphylococcus species was required "as they become available"; however, reports of this antibiotic resistant organism were only required quarterly. Response: The department agrees and is grateful to the commenter for pointing out this oversight; sec.sec.97.4(a) and 97.5(b)(3) have been changed to reflect the necessity of immediate reporting of vancomycin resistant coagulase negative Staphylococcus species. Comment: One commenter stated that speciation of all vancomycin resistant Enterococcus would result in an additional 5-10 identifications per month at a cost of $3.00 - $5.00 per panel. Response: The department agrees with the commenter that further speciation would impose an additional cost. However, the department is not requesting additional speciation of antibiotic resistant organisms. The definition in sec.97.1 has been changed to "Vancomycin resistant Enterococcus - Enterococcus species with a vancomycin minimum inhibitory concentration (MIC) greater than 16 µg/mL or a disk diffusion of 14 milliliters or less." Comment: Three commenters were concerned about the confidentiality of the statistics. "The prevalence of the antibiotic resistant organisms need to be published by communities not individual hospital or laboratories." This comment was concerning the rules regarding reporting of antibiotic resistant organisms in general. Response: The department agrees that confidentiality is a concern. All data with patient identifiers that are reported to the department are well protected by law. Data that are gathered for denominator purposes (eg, all Enterococcus species) will be stored and tabulated so as to prevent identification of particular hospitals. Comment: Two commenters had concerns about sec.sec.97.4(a) and 97.5(b)(3). "It is unclear whether reports of this antibiotic resistant bacteria are to go directly to TDH or to the local health department." Response: The department agrees that clarification of these sections is needed. Because of the confidentiality concerns, reports of antibiotic resistant isolates and numeric totals of Enterococcus species and Streptococcus pneumoniae should be reported directly to the state health department. The data will be compiled and reported back to the local health departments at least quarterly. Minor editorial changes were made in sec.sec.97.4(a) and 97.5(b)(3) to clarify this point. Comment: One commenter requested that "...the reports of the antibiotic resistant bacteria come through the local health department as do other reportable conditions. Bypassing the local health department serves to undermine their authority." Response: The department disagrees. The purpose of this reporting is to provide feedback of geographic antibiotic resistance patterns to providers on a quarterly basis, not to initiate a public health response. The reporting of antibiotic resistant organisms directly to the state health department will expedite data cleanup and analysis and timely reporting of these data back to health care providers. Any identification of vancomycin resistant Staphylococcus will be considered a public health emergency. The local health department will be notified by the department the same day any such report is received. No change was made as a result of this comment. Comment: Two commenters were concerned that in sec.97.1 there is no MIC for ampicillin resistant Haemophilus influenzae and requested clarification regarding the reporting of Haemophilus influenzae. Another commenter was concerned about increased laboratory costs related to beta lactamase testing of all Haemophilus influenzae; currently their laboratory only tests ampicillin resistant strains. Response: The department agrees. Ampicillin resistant Haemophilus influenzae reporting has been deleted from sec.97.1, sec.97.3(b)(3), sec.97.3(c)(6), sec.97.3(c)(7), sec.97.4(g), and sec.97.5(b)(3). Comment: Regarding sec.97.3(c)(6), two commenters asked whether the department wanted reporting of "all isolates" or of isolates by patient. Response: The department agrees that this section needed some clarification. Numerator data (i.e., resistant isolates), must be reported by name, city of submitter, date of birth or age, sex, anatomic site of culture, and date of culture; denominator data need only be reported by numeric totals. Minor editorial changes have been made in sec.97.3(c)(6) to clarify what to report. Comment: One commenter was concerned that some systems used for identification and antibiotic sensitivity testing have a vancomycin MIC cut-off of 16 µg/mL or greater. "All Enterococcus that have this value will then have to be further manually tested to determine if it is to be considered resistant by the state reporting standard." Response: The department agrees. The definition for vancomycin resistant Enterococcus has been changed to an MIC greater than 16 µg/mL instead of an MIC greater than or equal to 32 µg/mL. This change will eliminate the reporting of organisms which have a vancomycin MIC of 8 µg/mL - 16 µg/mL. The department recognizes that this could exclude occasional isolates with inducible van B resistance in which MICs may be 8 µg/mL - 16 µg/mL. The changes have been made in the definitions included in sec.97.1. Comment: One commenter had concerns regarding Enterococcus casseliflavis and Enterococcus gallinarum. "The automated systems that many medical centers use for identification and antibiotic sensitivity testing of organisms do not identify by species. To eliminate these two species of Enterococcus from the totals, further labor intensive manual testing will have to be done." Response: The department agrees. sec.97.1 defining vancomycin resistant Enterococcus has been changed to eliminate the need for additional manual testing. The department is not requiring that laboratories do additional speciation. Twenty-two commenters from 13 different associations or hospitals made comments regarding the proposed rules. Three commenters stated that they appreciate the need to conduct surveillance, provide data regarding antibiotic resistant bacteria, and aspire to impact the medical community's practices regarding antibiotics, but they felt there were some weak points in the proposed rules. The commenters were the University of Texas MD Anderson Cancer Center, Northwest Texas Healthcare System, and Baylor University Medical Center. The commenters were individuals from associations and hospitals who were generally not in favor of sec.97.3(c)(6) rules requiring reporting of numeric totals for Enterococcusspecies, Haemophilus influenzae, and Streptococcus pneumoniae. The commenters main concerns were the increase in costs and time spent to tabulate and report these data. Furthermore, the commenters felt the data collected would not give accurate antibiotic resistant rates. In addition, commenters were concerned about sec.97.1 regarding reporting of ampicillin resistant Haemophilus influenzae, and the minimum inhibitory concentration (MIC) of 32 µg/mL as the cut-off for reporting of vancomycin resistant Enterococcus. These comments on the proposed rules received by the department during the comment period were submitted by three board members of the Texas Society of Infection Control Practitioners, the Texas Hospital Association, the Dallas-Fort Worth Regional Chapter of Association for Professionals in Infection Control and Epidemiology, and from the Assistant Director of Communicable Disease at the City of Houston Health and Human Services Department. Comments were also received from individuals from nine different hospitals in Texas. The hospitals include; MD Anderson Cancer Center, Metropolitan Methodist Hospital, Northwest Texas Healthcare System, Victoria Regional Medical Center, RHD Memorial Medical Center/Trinity Medical Center, Parkland Memorial Hospital, Mercy Regional Medical Center, Baylor University Medical Center, and Methodist Hospital. The amendments are adopted under the Health and Safety Code, Chapter 81, which provides the Board of Health (board) with the authority to prevent and control communicable disease; and sec.12.001, which provides the board with the authority to adopt rules for the performance of every duty imposed by law on the board, the department, and the commissioner of health. sec.97.1.Definitions. The following words and terms, when used in these sections, shall have the following meanings, unless the context clearly indicates otherwise. Penicillin resistant Streptococcus pneumoniae - Streptococcus pneumoniae with a penicillin minimum inhibitory concentration (MIC) of 2 µg/mL or greater (high level), and an intermediate level resistance of 0.1- 1 µg/mL. Reportable disease - Any disease or condition that is required to be reported under the Act or by these sections. See sec.97.3 of this title (relating to What Condition To Report and What Isolates To Report or Submit). Any outbreak, exotic disease, or unusual group expression of illness which may be of public health concern, whether or not the disease involved is listed in sec.97.3 of this title, shall be considered a "reportable disease." Specimen Submission Form G-1 - A multipurpose specimen submission form available from the Texas Department of Health, Bureau of Laboratories, 1100 West 49th Street, Austin, Texas, 78756-3199. Vancomycin resistant Enterococcus species - Enterococcus species with a vancomycin MIC greater than 16 micrograms per milliliter (µg/mL) or a disk diffusion zone of 14 millimeters or less. Vancomycin intermediate Enterococcus (eg, Enterococcus casseliflavis and Enterococcus gallinarum) with a vancomycin MIC of 8 µg/mL - 16 µg/mL do not need to be reported. Vancomycin resistant Staphylococcus aureus and vancomycin resistant coagulase negative Staphylococcus species - For the purposes of reporting, Staphylococcus aureus or a coagulase negative Staphylococcus species with a vancomycin MIC of 8 µg/mL or greater. sec.97.3.What Condition To Report and What Isolates To Report or Submit. (a) (No change.) (b) Reportable conditions or isolates. (1) Confirmed and suspected cases of the following diseases are reportable: acquired immune deficiency syndrome (AIDS); amebiasis; anthrax; botulism - adult and infant; brucellosis; campylobacteriosis; chancroid; chickenpox; Chlamydia trachomatis infection; cholera; Creutzfeldt-Jakob disease (CJD); cryptosporidiosis; dengue; diphtheria; ehrlichiosis; encephalitis (specify etiology); Escherichia coli O157:H7 infection; gonorrhea; Hansen's disease (leprosy); Haemophilus influenzae type b infection, invasive; hantavirus infection; hemolytic uremic syndrome (HUS); hepatitis, acute viral (specify type); human immunodeficiency virus (HIV) infection; legionellosis; listeriosis; Lyme disease; malaria; measles (rubeola); meningitis (specify type); meningococcal infection, invasive; mumps; pertussis; plague; poliomyelitis, acute paralytic; rabies in man; relapsing fever; rubella (including congenital); salmonellosis, including typhoid fever; shigellosis; spotted fever group rickettsioses (such as Rocky Mountain spotted fever); streptococcal disease, invasive; syphilis; tetanus; trichinosis; tuberculosis; typhus; Vibrio infection (specify species); viral hemorrhagic fevers; yellow fever; and yersiniosis. (2) (No change.) (3) The following organisms shall be reported: Enterococcus species; vancomycin resistant Enterococcus species; vancomycin resistant Staphylococcus aureus; vancomycin resistant coagulase negative Staphylococcus species; Streptococcus pneumoniae; and penicillin - resistant Streptococcus pneumoniae. (c) Minimal reportable information requirements. The minimal information that shall be reported for each disease is as follows: (1)-(3) (No change.) (4) for tuberculosis - name, present address, present telephone number, age, date of birth, sex, race and ethnicity, physician, disease, type of diagnosis, date of onset, antibiotic susceptibility results, initial antibiotic therapy, and any change in antibiotic therapy; (5) for all other reportable conditions listed in subsection (b)(1) of this section - name, present address, present telephone number, age, date of birth, sex, race and ethnicity, physician, disease, type of diagnosis, date of onset, address, and telephone number; (6) for all isolates of Enterococcus species and all isolates of Streptococcus pneumoniae regardless of resistance patterns - numeric totals at least quarterly; and (7) for vancomycin resistant Enterococcus species; penicillin resistant Streptococcus pneumoniae; vancomycin resistant Staphylococcus aureus; vancomycin resistant coagulase negative Staphylococcus species, - name, city of submitter, date of birth or age, sex, anatomic site of culture, and date of culture. (d) Diseases requiring submission of cultures. For all Neisseria meningitidis from normally sterile sites, all vancomycin resistant Staphylococcus aureus, and vancomycin resistant coagulase negative Staphylococcus species - pure cultures shall be submitted accompanied by a Specimen Submission Form G-1. sec.97.4.When to Report a Condition or Isolate; When to Submit an Isolate. (a) The following reportable diseases are public health emergencies and suspect cases shall be reported immediately by phone to the local health authority or the regional director of the Texas Department of Health (department): botulism, foodborne; cholera; diphtheria; Haemophilus influenzae type b infection, invasive; measles (rubeola); meningococcal infection, invasive; pertussis; poliomyelitis, acute paralytic; plague; rabies in man; viral hemorrhagic fevers; yellow fever. Vancomycin resistant Staphylococcus aureus and vancomycin resistant coagulase negative Staphylococcus species shall be reported immediately by phone or fax to the Infectious Disease Epidemiology and Surveillance Division, Texas Department of Health, Austin. (b)-(f) (No change.) (g) For Enterococcus species; vancomycin resistant Enterococcus species; Streptococcus pneumoniae; and penicillin - resistant Streptococcus pneumoniae - reports shall be made no later than the last working day of March, June, September, and December. (h) All Neisseria meningitidis from normally sterile sites, all vancomycin resistant Staphylococcus aureus, and all vancomycin resistant coagulase negative Staphylococcus species shall be submitted as pure cultures to the Texas Department of Health, Bureau of Laboratories, 1100 West 49th Street, Austin, Texas 78756-3199 as they become available. sec.97.5.Where to Report a Condition or Isolate; Where to Submit an Isolate. (a) (No change.) (b) The administrative officer of a clinical laboratory, blood bank, mobile unit, or other facility shall report a condition or submit an isolate as follows. (1)-(2) (No change.) (3) For vancomycin resistant Staphylococcus aureus and vancomycin resistant coagulase negative Staphylococcus species immediately report by phone to the Infectious Disease Epidemiology and Surveillance Division at 1-800-252-8239. For Enterococcusspecies; vancomycin resistant Enterococcus species; Streptococcus pneumoniae; and penicillin - resistant Streptococcus pneumoniae; reports shall be mailed to the Infectious Disease Epidemiology and Surveillance Division, Texas Department of Health, 1100 West 49th Street, Austin, Texas 78756-3199, or faxed to the Infectious Disease Epidemiology and Surveillance Division at 512- 458-7616. (4) All Neisseria meningitidis from normally sterile sites, all vancomycin resistant Staphylococcus aureus, and all vancomycin resistant coagulase negative Staphylococcus species shall be submitted as pure cultures to the Texas Department of Health, Bureau of Laboratories, 1100 West 49th Street, Austin, Texas, 78756-3199. (c) (No change.) This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 9, 1998. TRD-9802187 Susan K. Steeg General Counsel Texas Department of Health Effective date: March 5, 1998 Proposal publication date: September 26, 1997 For further information, please call: (512) 458-7236 CHAPTER 115.Home and Community Support Services Agencies The Texas Department of Health (department), by majority vote of the Texas Board of Health (board) on February 8, 1998, enters this final order adopting amendments to sec.sec.115.1, 115.11, 115.12, 115.21, 115.25, 115.27, 115.28, 115.51, and 115.52 concerning the licensing of home and community support services agencies (HCSSAs). Sections 115.12, 115.21, and 115.52 are adopted with changes to the proposed text published in the December 5, 1997, issue of the type-name="italic">Texas Register (22 TexReg 11941). Sections 115.1, 115.11, 115.25, 115.27, 115.28, and 115.51 are adopted without changes to proposed text and will not be republished. The amended sections cover purpose; application and issuance of initial license; issuance and renewal of license; licensure requirements and standards for agencies providing licensed home health, licensed and certified home health or hospice services; standards for hospice services; standards for branch offices; standards for alternate delivery sites; survey procedures; and enforcement action. The most significant amendments to the rules implement changes to the Health and Safety Code, Chapter 142 as added by Acts of the 75th Legislature, 1997. Specifically, Senate Bill (SB) 1247 added new statutory requirements under sec.142.004(c) relating to an HCSSA's provision of certain documentation when applying for a license and sec.sec.142.017-142.0175 relating to the assessment of administrative penalties against an HCSSA. House Bill (HB) 3075 added new Health and Safety Code, sec.sec.142.061-142.063 relating to an HCSSA's possession of sterile water or saline, possession of certain vaccines or tuberculin, and possession of certain dangerous drugs. House Bill 3100 amended the Human Resources Code, Chapter 102 relating to rights of the elderly, requiring the department to amend the current rule reference to this statute. The administrative penalty requirements mandated by SB 1247 are unique from other licensing statutes authorizing the department to assess penalties (e.g., hospitals). The unique requirements are that the department may only assess an administrative penalty under rules adopted by the board: 1) for any number of days a violation occurred before the day on which an HCSSA receives notice of the violation counting as one violation; 2) for each day of a continuing violation occurring after the day the HCSSA receives notice of the violation counting as a separate violation; 3) according to a list of each violation for which a penalty may be assessed; 4) if the department has considered the seriousness of the violation (including the nature, circumstances, extent, and gravity of the violation and the hazard or safety of clients), the history of previous violations, and whether the HCSSA had identified the violation through its quality assurance process, and had made appropriate progress on correction; 5) if the department has provided an HCSSA with a reasonable time to correct the violation prior to assessing a penalty; 6) for minor violations, if these violations are of a continuing nature or not corrected; 7) if the violation is a hazard to the health or safety of an HCSSA client; and 8) according to a schedule of appropriate and graduated penalties. The proposed amendments to each of the affected sections are outlined as follows. The amendment to sec.115.1 (relating to purpose) corrects the rule's reference to the Medicare program from Title XIII to Title XVIII. The amendment to sec.115.11(g)(2)(D) implements new Health and Safety Code, sec.142.004(c)(5) which requires the department to request during the license application process identifying information on the HCSSA owner, administrator, and chief financial officer for the purpose of conducting a criminal background check on those persons. The amendment to sec.115.11(g)(2)(E) changes the percentage ownership reporting from 10% to 5% and adds the words, "and entities," to be clear that the department expects not only names of individuals but also business entities owning at least 5% interest in the applicant. The amendment to sec.115.11(g)(2)(J) changes the percentage ownership reporting from 10% to 5% to be consistent with the change in sec.115.11(g)(2)(E). The amendment to sec.115.11(j) adds new paragraph (6) to clarify that by applying for or holding an HCSSA license, an HCSSA consents to entry to the HCSSA and access to documents by the department to verify compliance with the provisions of the licensing statute and the licensing rules. The amendments to sec.115.12 implement changes to the Health and Safety Code, sec.142.004(c)(5) for the same reason described for sec.115.11(g)(2)(D) and require an HCSSA to provide an updated description of its service area at time of license renewal. The amendment to sec.115.21(a)(5) requires an HCSSA to notify the department of a change in the HCSSA administrator or chief financial officer within 15 calendar days after the change. The amendment to sec.115.21(b)(3)(B)(ii) changes the prohibition relating to an agency administrator from five years to one year and clarifies the term "enforcement action" as used in that clause. The amendment to sec.115.21(c)(2) corrects an incorrect cross reference to rule language concerning physician delegation. The amendment to sec.115.21(b)(3)(B)(iii) was made to conform to the reformatting of sec.115.52. The amendment to sec.115.21(b)(3)(D) provides that an HCSSA which only provides physical, occupational, speech, or respiratory therapy; medical social services; or nutritional counseling is not required to have a supervising nurse. The amendments to sec.sec.115.21(b)(4)(D) and (H), 115.27(e)(3), and 115.28(e)(3) clarify and make consistent rule language regarding client record storage. The amendment to sec.115.21(b)(4)(I) deletes the age reference to an elderly individual due to changes to the Human Resources Code, Chapter 102. The amendment to sec.115.21(c) adds a requirement that an HCSSA develop, implement, and enforce policies relating to qualifications of a registered nurse providing or supervising pediatric services (if offered) and relating to the possession of sterile water or saline, certain vaccines or tuberculin, and certain dangerous drugs. The amendment in sec.115.21(g)(3)(E) provides clarification as to an agency's responsibilities and a pharmacist's responsibilities in response to public comment. The existing language in sec.115.21(g) was deleted because it no longer applies; new subsection (g) describes the protocols and conditions under which an HCSSA may possess sterile water or saline, certain vaccines or tuberculin, and certain dangerous drugs and mirrors statutory language in the Health and Safety Code, sec.sec.142.061 - 142.063 (HB 3075). The amendment to sec.115.25(e)(1) clarifies that the medical director may be an independent contractor. This change eliminates concern that the existing language created a conflict for physicians with state law prohibiting the corporate practice of medicine. The amendment to sec.115.51(a) adds new paragraphs (5) and (6) for the same reasons as previously described for the amendment to sec.115.11(j). The amendment to sec.115.51(g) requires a department surveyor to review a sample of pediatric client records if pediatric clients are served by the HCSSA. Other changes to sec.115.51 were made for clarification purposes. Section 115.52 has been reformatted to provided needed clarification. Existing subsections (a) and (b) were combined under a common catch title called, "License denial, suspension or revocation." New language was added to new subsection (a)(1)(I) and (1)(J) to authorize the department to deny, suspend, suspend on an emergency basis, or revoke an HCSSA license if the HCSSA fails to comply with the Human Resources Code, Chapter 102 (relating to Rights of the Elderly) or knowingly employs as an administrator or chief financial officer an individual convicted of certain felonies or misdemeanors. New language was added to subsection (a)(2)(B)(vii) - (xx) to specify convictions under the Texas Penal Code which would bar a person from receiving an HCSSA license or would bar an individual from working in an HCSSA as an administrator or chief financial officer. The new language in sec.115.52(a)(3) clarifies that the notice giving due process to an HCSSA against which enforcement action is proposed by the department may be published in a newspaper of general circulation under certain conditions. In addition, the 15-day time period in which an HCSSA may request a hearing when enforcement action is proposed was changed to a 20-day time period in new sec.115.52(a)(3)(A) and (D). The amendment to sec.115.52(a)(5) and (6)(C) adds new clarifying language concerning the prohibition for applying for a license when enforcement action is taken against an HCSSA. Section 115.52(b) contains new language relating to the department's assessment of administrative penalties in accordance with the Health and Safety Code, sec.sec.142.017 - 142.0175. The new language describes the conditions under which the department may assess an administrative penalty, establishes a schedule of appropriate and graduated penalties based upon certain criteria, describes time frames in which an HCSSA must correct a violation, lists the violations which may effect an administrative penalty, and describes the due process provided to an HCSSA against which an administrative penalty is proposed. The change to sec.115.52(b)(3)(C) was made for clarification purposes in response to public comment. Section 115.52(c) contains existing language moved from deleted sec.sec.115.52(e) and (f) concerning court action. Section 115.52(d) contains existing language moved from deleted sec.115.52(k) relating to the surrender or expiration of a license. Other changes to the rules were for editorial purposes. The department received several comments on the proposal; a majority of the comments were submitted in writing and one was provided at a public hearing on the proposal held on December 19, 1997. The Home and Community Support Services Advisory Committee (committee) reviewed and approved the final rules on January 12, 1998. The comments, the department's responses, and the resulting changes(s) are summarized as follows: Comment: Concerning the proposed rules in general, one commenter expressed appreciation for the opportunity to comment and supported efforts to "...stamp out fraud and unscrupulous providers that might jeopardize the fate of this industry." Response: The department appreciates the support. No changes were made as a result of the comment. Comment: Concerning sec.115.11(g)(2)(D), one commenter stated that the rule limits the criminal background checks of corporations to the corporate entity, and added that the rule should allow the department to conduct criminal background checks on each officer, director, and shareholder of the corporation. The commenter suggested that without such criminal background checks, the department will not be able to verify compliance with other disclosure requirements. Response: The department understands the commenter's concern, but believes that it is not necessary to conduct criminal background checks on each officer, director, and shareholder of a corporate owner. The department has chosen to use its existing resources to focus on conducting background checks on individuals who have direct influence or oversight on the care delivered to HCSSA clients (e.g., administrator) and who are responsible for directly overseeing the day- to-day operations of an HCSSA (e.g., owner and individual acting in the capacity of chief financial officer). The department will continue to monitor the issue for problems and make changes to the rules in the future as necessary. No change was made. Comment: Concerning sec.115.11(g)(2)(E) and (J), three commenters stated that the percentage ownership conflicts with the percentage ownership specified in the definition of the term "affiliate" (sec.115.2(C)(iii)) and suggested the definition be changed to 5% instead of 10% for consistency. One of the commenters suggested the change would also provide more adequate disclosure of the information required in sec.115.11(g)(2)(R) and (S). This commenter concluded by asking if all officers and directors are required to provide the information described in sec.115.11(g)(2)(R) and (S) regardless of the amount of ownership interest, and suggested requiring the same information concerning the administrator be disclosed on the license application. Response: The department agrees that all disclosure requirements should be consistent. However, the department is unable to submit the change as a final rule at this time because a change to sec.115.2 was not duly afforded public comment. The change to sec.115.2 will be presented as a proposal to the board in the near future. In response to the commenter's other suggestion, the department disagrees that the same information concerning the administrator should also be submitted and made no change. The department believes that the new language in sec.115.11(g)(2)(D) allowing the department to conduct a criminal background check on the administrator is sufficient. Comment: Concerning sec.115.11(g)(2)(K) which was proposed as "(No change.)," one commenter suggested amending the language to seek information regarding bankruptcy or insolvency information from not only the corporate entity making an application, but also all affiliates. The commenter indicated that this would allow the department to better determine financial competency of a corporation which reorganizes under a different name. Response: The department agrees that a bankrupt corporation could dissolve, its former officers or directors reorganize to form a new corporation with no history of bankruptcy or insolvency. The requirement that such a corporation attest to having the financial resources to meet its proposed budget and provide services, and the disclosure of ownership information relating to the officers or directors should address the commenter's concern. After receiving a license, an applicant is also required to comply with sec.115.21(b)(5) relating to financial solvency. No change was made. Comment: Concerning sec.115.11(g)(2)(R) which was proposed as "(No change.)," one commenter indicated that the disclosure requirement does not specify a time limit and suggested that the department's application form does not fully implement this requirement. The commenter added that the language should be clarified to indicate that the applicant, all officers, all directors, all persons owning 5% or more of the stock, all other controlling persons, and the administrator are required to disclose the information listed. Response: The department agrees that the existing language in sec.115.11(g)(2)(R) does not specify a time limit and did not intend to limit the time period for the information listed under subparagraph (R). The department believes that disclosure of the information specified in sec.115.11(g)(2)(R) is important regardless of how long before application is made. Unless the administrator is an applicant, affiliate, or manager, disclosure of the information is not necessary. Further, the new language in sec.115.11(g)(2)(D) is adequate to address concerns relating to the administrator's criminal background. No change to sec.115.11(g)(2)(R) was made. Comment: Concerning sec.115.11(g)(2)(S) which was proposed as "(No change.)," one commenter suggested extending the time period for disclosing certain information regarding the applicant, the applicant's affiliates, and the applicant's managers from two years to five years. Response: The department disagrees that the information required for disclosure described in sec.115.11(g)(2)(S) should be for a five-year period prior to application and believes that the two-year period is sufficient for the disclosure of the information described in the subparagraph. No change was made. Comment: Concerning sec.115.12(b)(2)(A), one commenter stated that the affidavit of financial solvency and resources is excluded from the requirements for license renewal and that additional specificity should be added to the language in sec.115.11(g)(2)(K) relating to financial resources. The commenter added that such a lack of specificity coupled with the confidentiality statement in the Health and Safety Code, sec.142.004(d) fails "to project public confidence into the industry as a whole" and that the public "deserves to place their trust in those home health agencies that can demonstrate financial solvency, and dependability in accordance with exacting regulatory standards." Response: The department disagrees that the affidavit for financial solvency should be required upon renewal. Upon issuance of a license, the HCSSA is required to comply with many standards which would demand it to maintain the financial ability to fulfill its responsibilities to provide quality care to its clients. The department believes that existing sec.115.21(b)(5) relating to financial solvency contains the requirement intended by the commenter and is more effective than an affidavit requirement. No change was made. Comment: Concerning sec.115.13(a)(3), one commenter suggested that a change of ownership occurs when 50% or more controlling interest in the corporation changes. The commenter added that the department should add a requirement that all new officers, directors, shareholders, and HCSSA administrators must reapply for a license 15 days in advance of the change. Response: The department understands the commenter's concern. However, amendments to sec.115.13 were not proposed. State law in sec.142.002(e) provides that a license may not be transferred to another person. "Person" refers to the legal entity in whose name the license would be held. If 40% or more controlling interest in the corporation changes, there is no change in the legal entity which holds the license. The same corporation continues to hold the license. If there is a question as to whether a change of ownership occurs due to a reorganization of a corporation, partnership, or other business entity, department staff will continue to request a review of the transaction by the department's Office of General Counsel for a legal opinion as to whether a change of ownership has occurred under the appropriate licensing statute. Regarding the commenter's suggestion that the department require 15 days of advance notice of a change of control, such a change does not change the legal entity which holds the license. The department cannot require relicensure if there is a change of control. Since a license is not transferrable nor assignable, a new owner who does not apply for a license in accordance with sec.115.13 would be operating an HCSSA without a license. In such a scenario, the owner is subject to injunctive action, and civil and administrative penalties. The department will continue to monitor change of ownership transactions for problems and will propose amendments to the section as necessary. No change was made. Comment: Concerning sec.115.21(b)(2)(G)(i) and sec.115.21(b)(4)(I)(ix), one commenter stated that requiring HCSSAs to provide a copy of the entire Human Resources Code, Chapter 102 (relating to Rights of the Elderly) is not necessary since the intent of the law is to let clients know about their rights under the law. The commenter requested amending the language to allow an HCSSA to provide only the list of rights included in the law (sec.102.003). Response: The department disagrees that the law relating to rights of the elderly should not be provided to a client. All five sections of the Human Resources Code, Chapter 102 contain important information for a client. Section 102.001 defines terms used in the following sections; sec.102.002 informs the client that a provider may not deny them a right listed in the law and violation of the law is grounds for suspension or revocation of the license; sec.102.003 describes the client's rights; sec.102.004 requires a provider to provide a client with the written list of the rights and to inform the client of changes in the list; and sec.102.005 informs the client that the list of rights is in addition to other rights or remedies to which an elderly individual is entitled. Since sec.sec.102.001, 102.002, 102.004, and 102.005 combined contain less text than sec.102.003 alone and the statute is readily available on the Internet and in public libraries, the department believes it will not be burdensome to HCSSAs to reproduce the additional text and provide it to their clients. No change was made. Comment: Concerning in sec.115.21(b)(3)(B)(ii), one commenter stated that the department's proposal to change the employment prohibition for administrators from five years to one year and to exclude administrative or civil penalties from the term "enforcement action" diminishes the already inadequate requirements in sec.115.21(b)(3)(B)(i)(III). The commenter stated that existing sec.115.21(b)(3)B)(i)(III) is inadequate to protect the health and safety of the public and suggested the development of more stringent standards of training and experience for HCSSA administrators. Response: The department disagrees with the commenter. The department believes that the one-year employment prohibition for administrators is adequate and that the new rule language adopted by the board effective October 1, 1997, increases accountability of an HCSSA to provide quality care to its clients. The department further believes that the new rules prescribing administrative penalties for violations of a continuing nature or of health or safety significance will provide a new protection to the public not previously in place. The department agrees with the commenter that the new enforcement activities (administrative penalties) is in its "infancy." The department has benefited from the experiences of other state agencies implementing enforcement strategies and has chosen to implement the enforcement tools in a manner which will promote and protect patient care through working with industry and consumers to effect positive changes toward that goal. The department believes that the new requirements are a beginning to seek a balance between the department's mandate to regulate the HCSSA industry while affording the industry due process. The department will continue to review the training and experience issue as it relates to enforcement activities and will make changes in the future as necessary. The department also notes that the training and experience requirement referred to by the commenter does not "grandfather" an administrator hired prior to October 1, 1997. No change was made. Comment: Concerning sec.115.21(b)(3)(B)(ii), one commenter expressed support for the reduction from a five-year to a one-year exclusion of an individual in the administrator position. The commenter indicated the change was "...more appropriate and reasonable." The same commenter expressed concern that an administrator hired by an HCSSA to replace the administrator employed at the time violations were cited would be held accountable for the violations which occurred prior to his or her employment. The commenter suggested adding language to clarify that the administrator would have to have been employed by the HCSSA for at least six months prior to the enforcement action in order for the rule to apply; that the administrator will have the opportunity for review by the department's Enforcement Action Committee (EAC) of the circumstances and the appropriateness of excluding the administrator before the exclusion is applied; and that the EAC make a separate determination relating to the administrator's exclusion and the HCSSAs exclusion. The commenter expressed similar concerns in the case of a new owner taking control of an HCSSA which was cited with violations resulting in enforcement action. Response: The department agrees that the proposed language is more appropriate and has retained the language. The department disagrees that the rule language infers the possible scenarios described by the commenter and that additional language is necessary. The rule is clear that the employment prohibition for an administrator is relevant only to the administrator who was employed "at the time the agency was cited with violations of the statute" or the licensing rules "which resulted in enforcement action taken against the agency." If the new administrator was not employed at the time the violations were cited, then the new administrator is not prohibited from being employed by another HCSSA owned by the same or different owner. If the violations were cited after the new administrator was hired to correct problems identified by the HCSSA, and improvements were effected after the new administrator's arrival, the department takes this as well as the seriousness of the violations into consideration when reviewing a case for enforcement action. The department further notes that the enforcement actions effecting the exclusion include revocation or suspension of a license (administrative penalties would not effect the exclusion), which reflects that very serious health and safety issues exist. The commenter's concern that a new owner could be held responsible for violations found under previous ownership is irrelevant to the rule requirement in sec.115.21(b)(3)(B)(ii). An enforcement action against a licensee is against the owner of the HCSSA at the time violations were cited; enforcement action relating to a previous owner cannot be made against the new owner. No change was made. Comment: Concerning sec.115.21(b)(3)(D), one commenter stated that the rule was not clear as to how the overall plan of care is coordinated, especially in situations where the staff is contracted and the HCSSA offers only the one therapy service. The commenter added that under the rule, children with complex medical situations and the isolated elderly are placed at increased risk with less coordination of services and appropriate oversight when served by an HCSSA that offers one therapy service or contracts for services. Response: The department disagrees that clients will be at risk and that less coordination of services will occur when a client is served by an HCSSA offering one therapy service or contracts for services. For example, an HCSSA which provides only physical therapy services must enter into an agreement with the client who is receiving the service. The HCSSA and client must agree that only physical therapy services will be provided. The HCSSA is then not responsible for other needs the client develops while receiving the one service from the HCSSA. In this scenario, the coordination of other needs is the responsibility of the client, client's family, and the client's physician. No further clarification is necessary and no change was made. Comment: Concerning sec.115.21(c)(37), one commenter requested a definition for pediatric services as the term is used in the rule and indicated that the rule requires only nursing to have pediatric qualifications. The commenter included sec.115.21(c)(38) relating to a policy concerning the possession of sterile water or saline, certain vaccines or tuberculin, and certain dangerous drugs in the comment regarding the need to define pediatric services. The commenter further suggested requiring all staff to be required to have pediatric qualifications (not just nursing staff) and that those qualifications be clarified and added that the rule be amended to read "...supervises direct nursing care staff...." Response: The department disagrees that the term "pediatric services" requires definition. The term is clear to mean services provided to a pediatric client. The department further disagrees that the rule should require all staff caring for a pediatric client to have "pediatric qualifications." The services provided to a client under sec.115.21(c)(37) must be supervised by a registered nurse (supervising nurse). The department believes that the requirement that the supervising nurse overseeing the care of the pediatric client or the nurse actually providing the care have pediatric qualifications is sufficient. It is each HCSSA's responsibility to determine how extensive such qualifications should be based upon the skill level appropriate to clients served by the agency. The rule language in sec.115.28(c)(38) does not relate to the qualifications of staff providing services to pediatric clients. No change was made. Comment: Concerning sec.115.21(g)(1)-(3), one commenter stated it was not appropriate to include statutory language regarding the possession of sterile water, saline, certain vaccines, or tuberculin, and certain dangerous drugs (see Health and Safety Code, sec.sec.142.061-142.063). The commenter stated that if the department retains the statutory requirements, then the department should delete the text in paragraphs (3)(E) and (3)(G) because the language applies to a pharmacy, not to an HCSSA. Response: The department agrees that the rule language implies that it applies to a pharmacy, but believes that the HCSSA should be aware of its responsibilities and how they relate to those of the pharmacy. Therefore, the department has amended the language in sec.115.21(g)(3)(E) to read, "A pharmacist that dispenses a sealed portable container under this subsection will ensure that the container..."; and amended the language in sec.115.21(g)(3)(G) to read, "A pharmacy that dispenses a sealed portable container under this subsection is required to take reasonable precautionary measures...the pharmacy will perform an inventory of the drugs used from the container and will restock and reseal...." Comment: Concerning sec.115.21(g)(2)(B)(iii), one commenter suggested changing the language to read, "...indicates that the recipient of the vaccine or tuberculin has been assessed by the physician as an appropriate candidate to receive the vaccine or tuberculin...." Response: The department disagrees that the rule requires the suggested additional language. The department believes that the statutory language on which the rule is based is sufficiently clear to allow assessment by an individual who may make such an assessment under the appropriate professional licensing law. No change was made. Comment: Concerning sec.115.21(g)(3)(B)(i), one commenter suggested changing the language to read, "...the container is handled properly as determined by storage, transportation, and temperature stability...." Response: The department disagrees that the suggested change is necessary. The rule is sufficiently clear regarding proper handling of the container. No change was made. Comment: Concerning sec.115.21(g)(3)(B)(iv), one commenter suggested changing the language to read, "...the agency maintains a written record of the dates and times the container is to be in the possession of a registered nurse or licensed vocational nurse." Response: The department disagrees that the words "to be" should be added to the rule; the rule language is sufficiently clear regarding the possession of the container. No change was made. Comment: Concerning sec.115.51(g), one commenter asked what the surveyors will be looking for when reviewing a pediatric record and indicated that the rule suggests there are special rules or guidelines for the pediatric client an HCSSA must follow. Response: The department disagrees that the rule implies an HCSSA must follow certain special rules or guidelines for the pediatric client. An agency accepting a pediatric client must follow professional standards of practice based upon the level of care needed by the client and the services provided through agreement between the client's family and the HCSSA. A surveyor will be reviewing the record for such information. The department will expect each HCSSA admitting a pediatric client to determine whether their HCSSA has the staff qualified by training or experience in caring for the client admitted. The needs of a pediatric client admitted to one HCSSA may differ from needs of a pediatric client admitted for services by another HCSSA. Each HCSSA should determine whether each client's needs can be met and if not all can be met, whether the client's family and HCSSA can agree on which needs will be met by the HCSSA and which will not. This information is to be included in the plan of care for that client. The licensing rules governing HCSSAs do not contain special guidelines or requirements for the care of a pediatric client. No change was made. No change was made. Comment: Concerning sec.115.51(g), one commenter expressed appreciation for requiring that a survey include a review of a sample of pediatric records if pediatric clients are served by the HCSSA. Response: The department appreciates the support and no change was made. Comment: Concerning sec.115.52(a), one commenter suggested amending the language to provide that the "department may deny an initial license or refuse to renew a license if an applicant or any other person required to submit background information does not have a satisfactory history of compliance with state or federal home health regulations." The commenter provided a list of conditions that the department should consider when determining "satisfactory compliance with regulations." Response: The department disagrees that the proposed rule does not provide the department with the authority to deny an initial license or renew an existing license due to unsatisfactory compliance with state or federal regulations. The rule language in sec.115.52(a)(1)(H) is sufficient to allow the department to deny a license for previously proposed or completed enforcement action against the applicant, its affiliates, or its managers. No change was made. Comment: Concerning sec.115.52(a)(3), one commenter suggested adding language that an HCSSA's refusal to accept a notice of violation does not nullify the effect of the notice. Response: The department agrees that the language would clarify presumption of delivery of a notice of violation letter and has added the sentence, "An agency which fails to claim a notice sent by certified mail or refuses to accept the notice does not make the notice null and void." Comment: Concerning sec.115.52(a)(5), one commenter stated that the rule excludes an owner with multiple HCSSAs (all except one of which are without problems) from expanding elsewhere in the state for one year and that such an exclusion is too restrictive. Response: The department disagrees that the rule is overly restrictive. The department believes that the one-year time frame is reasonable in cases where the owner has had an HCSSA license revoked or suspended or had injunctive action taken against them. The department notes that in implementing the rule language, due process is afforded an HCSSA via the department's formal hearing procedures in Title 25, Chapter 1 and the Government Code, Chapter 2001. No change was made. Comment: Concerning sec.115.52(b), one commenter recommended that the department develop criteria or guidelines to determine when it would be appropriate for a surveyor to recommend a cited deficiency for an administrative penalty or to the EAC for enforcement action. Response: The department disagrees that special criteria or guidelines should be developed. Each case forwarded to the EAC is reviewed on a case-by-case basis as to whether a rule(s) or provision(s) of the licensing law was violated, the seriousness of the violation, and the appropriate remedy for the violation. No change was made. Comment: Concerning sec.115.52(b), one commenter expressed the expectation that the intent of administrative penalties is for repeat offenders who do not come into compliance after they have been given numerous opportunities and warnings. The commenter asked whether there were acceptable client to staff ratios and expressed concern that a penalty would be assessed if an HCSSA was short of nursing staff. The commenter indicated that under the nursing staff shortage scenario, assessment of penalties "...would only deny service to an already inadequately served population; the elderly rural citizens." Response: The department agrees that an administrative penalty may be assessed in cases for the HCSSA's continued noncompliance with the rules or licensing statute. This is provided by the Health and Safety Code, sec.sec.142.017(a), (c), and (f) and implemented by rule in sec.sec.115.52(b)(2)(B) - (D). There are some situations, however, which may warrant an administrative penalty (severity level II) even if corrected. For these scenarios, this is provided for in sec.115.52(b)(3)(B). The department disagrees that the assessment of administrative penalties will deny service to the elderly in rural areas. Each HCSSA is required to have back-up services in the event the HCSSA is unable to provide a service agreed upon between the client and the HCSSA (see existing sec.115.21(b)(2)(D)). Further, the department expects each HCSSA to determine whether the personnel on staff is adequate to meet the needs of the clients accepted for services. In no event shall an HCSSA admit more clients for services than the agency is staffed to cover. No change was made as a result of the comment. Comment: Concerning sec.115.52(b)(3), one commenter stated that the rule language stifles the statutory requirement in the Health and Safety Code, sec.142.017(b) which states, "each day of a continuing violation that occurs after the day on which the person receives written notice of the violation from the department constitutes a separate violation" and undermines the deterrent element of administrative penalties contrary to sec.142.017(d)(4) which requires the department's rules set appropriate and graduated penalties for each violation to consider the amount necessary to deter future violations. The commenter added that the rule language does not address violations that "simply can not be corrected," citing a client death as an example; that the rules make no reference to how many cycles of violation/correction an HCSSA will be granted to correct or how many times penalties can be overcome by this procedure; and that the rules do not include procedures to be used by the department to determine if the violation is actually corrected. Response: The department disagrees that the rule language stifles or is contrary to the statutory requirements. The department has considered all statutory requirements and has developed the rule language to meet the intent of those requirements as a whole. It is not appropriate to base the rule language on an isolated statutory mandate without consideration of the other mandates the department is required to consider. The department agrees that while outcomes related to noncompliance cannot be corrected, correction of the conditions which caused the rule violation is possible. The department is not precluded from suspending or revoking a license regardless of whether administrative penalties may or may not be appropriate under the schedule of penalties. No change was made. Comment: Concerning sec.115.52(b), one commenter stated that the rules do not "provide a middle ground between doing nothing and revoking an agency's license." Response: The department disagrees that the rule relating to administrative penalties does not provide the department with the authority to take an enforcement action other than revoking a license. The rule language meets specific legislative intent not to overly penalize an HCSSA for violations unless the violations are not corrected or not corrected timely. No change was made. Comment: Concerning sec.115.52(b)(3), one commenter stated that the department should identify circumstances in which correction of a violation is not appropriate "and permitting an agency to escape the full measure of available enforcement would be contrary to the public interest." The commenter added that these "situations include but are not limited to fraud, misrepresentation on applications, circumstances leading to serious injury or death of a client, sexual abuse of a client, fraudulent billing practices, operating without a license, any type of client abuse, or falsification of client records." Response: The department disagrees that the language should be amended. The department agrees that the situations listed by the commenter are grounds to effect enforcement action and believes that the rules do not overly restrict the department's ability to do so. No change was made. Comment: Concerning sec.115.52(b)(4), one commenter requested clarification in writing as to how the schedule of penalties would be implemented. The commenter stated that the rule indicates that only those rules cited in the schedule would be eligible for administrative penalties and in addition violations on the severity level II schedule would only have administrative penalties assessed if the violations caused serious harm or death, constituted an actual serious threat, or substantially limited the capacity of the HCSSA to provide care. The commenter assumed that if the violation(s) did not result in any of these consequences, then an administrative penalty would not be assessed. Response: The department responds that a violation (alone or in combination) listed on the severity level II schedule can result in serious harm or death of a client, constitutes an actual serious threat to the health or safety of a client, or can substantially limit the agency's ability to provide care. The amount of the severity level II penalty is determined according to sec.115.52(b)(4)(D), and the criteria described in sec.115.52(b)(2)(B) and (C). If the outcome of a violation is serious harm or death of a client, a severity level II penalty for each of the severity level II violations cited could be assessed for the appropriate amount. The department notes that assessment of a penalty does not preclude the department from proposing to revoke, suspend, or deny a license or take injunctive action. The department agrees that the rule needs additional clarification and has added the following sentence to sec.115.52(b)(3)(C), "A penalty(ies) assessed under this subsection may be a severity level I penalty(ies) or a severity level II penalty(ies) or a combination of severity level I penalty(ies) or severity level II penalty(ies)." The department has also changed the word "and" to "or" at the end of sec.115.52(b)(4)(D)(i)(II) to be consistent with the corresponding language in sec.115.52(b)(3)(a)(i). Comment: Concerning Figure 1: sec.115.52(b)(4)(C)(iii), one commenter suggested deleting sec.sec.115.27(e) and 115.28(e) from the severity level I violation schedule. The commenter stated that if personnel records can be kept at any location, then a citation on the location of personnel files is not appropriate for an administrative penalty. Response: The department agrees that the subject reflected in the schedule does not seem appropriate for inclusion in the penalty schedule. Sections 115.27(e) and 115.28(e) contain more requirements than the location of the personnel records. Section 115.27(e)(1) requires on-site supervision of the branch office, sec.115.27(e)(2) requires the personnel records to be accessible and readily retrievable for inspection by the department at the site of the survey, sec.115.27(e)(3) requires that the active clinical record be kept at the branch office location, and sec.115.27(e)(4) requires the parent agency to approve all branch office policies and procedures and that the approval be filed in the parent and branch office sites. Section 115.28(e) contains corresponding requirements relating to alternate delivery sites. The department believes that violation of one or more of these requirements may be appropriate for an administrative penalty (only one penalty may apply for one or more requirement under sec.115.27(e) violated). The department has changed the reference to sec.115.27(e) in the schedule to read, "Relating to requirements for branch offices" and to sec.115.28(e) in the schedule to read, "Relating to requirements for alternate delivery sites." Comment: Concerning sec.115.52(b)(4)(C) and (D), one commenter suggested changing the severity level I penalty range to $100-$500 and the severity level II penalty range to $501-$1,000. The commenter indicated that there is a gap between the two levels which implies that a third level of penalty should exist between $251-$499. Response: The department understands the commenter's concern. However, the department believes that its assessment of dollar amounts to the two severity levels are appropriate amounts considering the types of violations that might occur under each severity level. No change was made. Comment: Concerning sec.115.52(b)(4)(D)(i)(III), one commenter recommended clarifying what constitutes a limitation in the capacity to provide care and asked the department to specify which citations would fall under this rule. Response: The department disagrees that greater specificity of rule violations is appropriate. Violation of one or more than one of the rules listed may effect a limitation in an HCSSA's capacity to provide care. the department believes that specifying which violations of rules would substantially limit the HCSSA's capacity to provide care would overly restrict the department's ability to implement the administrative penalty provisions. No change was made. Comment: Concerning sec.115.52(b)(4)(D)(ii) and the Severity Level II violations, one commenter stated that the rule language describing one or more violations of the Medicare Conditions of Participation would translate into only one administrative penalty and limits the department's ability to regulate home and community support services agencies. The commenter suggested that the department develop a crosswalk reference matching the federal and state requirements to identify where the rules overlap and where they do not. Response: The department understands the commenter's concern. However, the department's regulatory responsibility is to evaluate the appropriateness of an administrative penalty based upon noncompliance with a licensing rule(s). There is one licensing rule relating to noncompliance with the Medicare Conditions of Participation (sec.115.23(a)); therefore, one administrative penalty for each violation of that rule is appropriate. No change was made. Comment: Concerning sec.115.52(b)(4)(C) and (D), one commenter suggested that the department should eliminate the reference to specific rules in the schedule of penalties. The commenter stated that this "rule by rule approach" ties the hands of the department in making determinations of what activity warrants which level of penalty. Response: The department understands the commenter's concern. However, the department believes that the schedule meets the legislative intent of the statutory requirement to specify by rule each violation for which an administrative penalty may be assessed and to establish a schedule of appropriate and graduated penalties for each violation based upon certain circumstances (Health and Safety Code, sec.142.017(c) and (d)). No change was made. The comments received were from the American Association of Retired Persons; Texas Association for Home Care; Hospice Brazos Valley, Bryan, Texas; First Cambridge Home Health Care, Richmond, Texas; and department staff. The commenters were neither for nor against the rules in their entirety, but expressed concerns, asked questions, and made recommendations for revisions. The rules will become effective 20 days after filing with the Texas Register. SUBCHAPTER A.General Provisions 25 TAC sec.115.1 The amendment is adopted under the Health and Safety Code, sec.142.004(c) which provides the board with the authority to adopt rules to require an applicant for an HCSSA license to provide identifying information on the HCSSA owner, administrator, and chief financial officer to enable the department to conduct criminal background checks on those persons; sec.142.011 which provides the board with the authority to adopt minimum standards governing the licensing of HCSSAs; sec.142.017(c) which provides the board with the authority to specify by rule each violation for which an administrative penalty may be assessed; sec.142.017(d) which requires the board to establish by rule a schedule of appropriate and graduated penalties for each violation based upon certain criteria; sec.142.017(e) which requires the board by rule to provide an HCSSA with a reasonable period of time following the first day of a violation to correct the violation before assessing an administrative penalty if a plan of correction has been implemented; and under sec.12.001 which provides the board with the authority to adopt rules for the performance of every duty imposed by law upon the board, the department, and the commissioner of health. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9801936 Susan K. Steeg General Counsel Texas Department of Health Effective date: March 2, 1998 Proposal publication date: December 5, 1997 For further information, please call: (512) 458-7236 SUBCHAPTER B.Application and Issuance of a License 25 TAC sec.115.11, sec.115.12 The amendments are adopted under the Health and Safety Code, sec.142.004(c) which provides the board with the authority to adopt rules to require an applicant for an HCSSA license to provide identifying information on the HCSSA owner, administrator, and chief financial officer to enable the department to conduct criminal background checks on those persons; sec.142.011 which provides the board with the authority to adopt minimum standards governing the licensing of HCSSAs; sec.142.017(c) which provides the board with the authority to specify by rule each violation for which an administrative penalty may be assessed; sec.142.017(d) which requires the board to establish by rule a schedule of appropriate and graduated penalties for each violation based upon certain criteria; sec.142.017(e) which requires the board by rule to provide an HCSSA with a reasonable period of time following the first day of a violation to correct the violation before assessing an administrative penalty if a plan of correction has been implemented; and under sec.12.001 which provides the board with the authority to adopt rules for the performance of every duty imposed by law upon the board, the department, and the commissioner of health. sec.115.12.Issuance and Renewal of License. (a) (No change.) (b) Renewal application. (1) (No change.) (2) The agency shall submit to the department postmarked prior to the expiration date of the license: (A) a complete and correct application renewal form which includes updated information as required by sec.115.11(g)(2)(D) - (J), sec.115.11(g)(2)(K)(iii)- (v), and sec.115.11(g)(2)(R) and (S) of this title; (B) a description of the agency's service area. The service area shall be established in accordance with sec.115.21(a)(7) of this title (relating to Licensure Requirements and Standards for Agencies Providing Licensed Home Health, Licensed and Certified Home Health, or Hospice Services) for agencies providing licensed home health, licensed and certified home health, or hospice services; or sec.115.26(b) of this title (relating to Standards for Personal Assistance Services) for agencies with the category of personal assistance services; (C) the renewal license fee; (D) if accredited, documentation from: (i) the Joint Commission for Accreditation of Healthcare Organizations indicating the agency holds a current accreditation for the applicable service; or (ii) the Community Health Accreditation Program indicating the agency is accredited for the applicable service; (E) if accredited by another accrediting organization, documentation regarding the accrediting organization to show that the accrediting organization's standards meet or exceed this chapter; (F) if certified by or contracting with another state agency to deliver services for which a license is required under this chapter, documentation from the certifying state agency(ies) confirming the certification or contract; and (G) if an applicant is a corporation, a current letter from the state comptroller's office stating the corporation is in good standing or a notarized certification that the tax owed to the state under the Tax Code, Chapter 171, is not delinquent or that the corporation is exempt from the payment of the tax and is not subject to the Tax Code, Chapter 171. (3) (No change.) (c) - (e) (No change.) This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9801935 Susan K. Steeg General Counsel Texas Department of Health Effective date: March 2, 1998 Proposal publication date: December 5, 1997 For further information, please call: (512) 458-7236 SUBCHAPTER C.Service Standards 25 TAC sec.sec.115.21, 115.25, 115.27, 115.28 The amendments are adopted under the Health and Safety Code, sec.142.004(c) which provides the board with the authority to adopt rules to require an applicant for an HCSSA license to provide identifying information on the HCSSA owner, administrator, and chief financial officer to enable the department to conduct criminal background checks on those persons; sec.142.011 which provides the board with the authority to adopt minimum standards governing the licensing of HCSSAs; sec.142.017(c) which provides the board with the authority to specify by rule each violation for which an administrative penalty may be assessed; sec.142.017(d) which requires the board to establish by rule a schedule of appropriate and graduated penalties for each violation based upon certain criteria; sec.142.017(e) which requires the board by rule to provide an HCSSA with a reasonable period of time following the first day of a violation to correct the violation before assessing an administrative penalty if a plan of correction has been implemented; and under sec.12.001 which provides the board with the authority to adopt rules for the performance of every duty imposed by law upon the board, the department, and the commissioner of health. sec.115.21.Licensure Requirements and Standards for Agencies Providing Licensed Home Health, Licensed and Certified Home Health, or Hospice Services. (a) Conditions of license. An agency licensed to provide licensed home health, licensed and certified home health, or hospice services shall comply with the requirements in this section. (1) - (4) (No change.) (5) An agency shall notify the department in writing of any change in the agency administrator or chief financial officer within 15 calendar days after the change. (6) A license shall not be materially altered. (7) An agency shall provide services only within its service area. (A) The agency shall maintain adequate staff to provide services and to supervise the provision of services within the service area. (B) An agency may expand its service area at any time during the licensure period. To expand its service area, an agency must submit to the department a written notice for the expansion which includes revised boundaries of the agency's original service area, the effective date of the expansion, and an updated list of management and supervisory personnel (including names), if changes are made. The notice must be submitted either before or within 30 calendar days after the effective date of the expansion. (C) An agency may reduce its service area at any time during the licensure period by sending the department written notification of the reduction, revised boundaries of the agency's original service area, and the effective date of the reduction. (D) A branch office or alternate delivery site shall be located within the parent agency's service area. (8) A separate license is required for each principal place of business. (b) Agency responsibilities. (1) General. (A) An agency shall adopt, implement, and enforce the provisions of the Human Resources Code, Chapter 102 (relating to Rights of the Elderly). (B) - (G) (No change.) (2) Provision of services. (A) - (F) (No change.) (G) The agency and the client or his family shall have a written agreement for services. The agency shall obtain an acknowledgment of receipt of the agreement. The agency shall comply with the terms of the agreement. The agreement shall include, but may not be limited to, the following: (i) notification of the Human Resources Code, Chapter 102 (relating to Rights of the Elderly); (ii) - (v) (No change.) (H) - (J) (No change.) (3) Staffing. (A) (No change.) (B) The agency shall appoint an administrator who shall administratively supervise the provision of all services. (i) (No change.) (ii) The administrator shall not have been employed in the last one year as an administrator with another agency at the time the agency was cited with violations of the statute or this chapter which resulted in enforcement action taken against the agency. For purposes of this clause only, the term "enforcement action" means license revocation, suspension, emergency suspension, or denial of a license or injunction action but does not include administrative or civil penalties. If the department prevails in one enforcement action (e.g. injunctive action) against the agency but also proceeds with another enforcement action (e.g. revocation) based on some or all of the same violations, but the department does not prevail in the second action (e.g., the agency prevails), the prohibition in this clause does not apply. (iii) The administrator shall not have been convicted of a felony or misdemeanor listed in sec.115.52(a)(2)(B) of this title (relating to Enforcement Action). (iv) (No change.) (v) The administrator shall: (I) - (V) (No change.) (VI) authorize in writing an assistant administrator or other individual to act in his or her absence. The administrator, assistant administrator, or other designee shall be available during the agency's usual working hours. The administrator's designee shall be able to read, write, and comprehend English and have at least six months of full-time supervisory or administrative experience in home health, hospice, or related health programs. (C) (No change.) (D) An agency which only provides physical, occupational, speech, or respiratory therapy; medical social services; or nutritional counseling is not required to comply with subparagraph (C) of this paragraph. Supervision of these services shall be provided by the applicable licensed professional (e.g., a physical therapist supervising physical therapy services). (4) Client record. An agency shall establish and maintain a client record system to assure that the care and services provided to each client is completely and accurately documented, readily available, and systematically organized to facilitate the compilation and retrieval of information. (A) - (C) (No change.) (D) The agency shall establish an area for active client record storage at the agency's place of business. The active client record shall be stored at the place of business (e.g. parent agency location, branch office, or alternate delivery site) from which services are actually provided. Active client records shall not be stored at an administrative support site or records storage facility. (E) - (G) (No change.) (H) Inactive client records may be preserved on microfilm, optical disc or other electronic means and may be stored at the parent agency location, branch office, alternate delivery site, administrative support site, or records storage facility. Security shall be maintained and the record must be readily retrievable by the agency. (I) Each client record shall include: (i) - (viii) (No change.) (ix) acknowledgment of the client's receipt of a copy of the Human Resources Code, Chapter 102, Rights of the Elderly; (x) - (xii) (No change.) (J) - (K) (No change.) (5) - (6) (No change.) (c) Policies required. An agency shall develop, adopt, implement, and enforce a written policy(ies): (1) (No change.) (2) describing protocols and procedures agency staff must follow when performing physician delegated tasks. The policy shall be consistent with subsection (b)(1)(G) of this section and address the time frame for the timely counter signature of a physician's verbal orders; (3) - (34) (No change.) (35) relating to the agency's procedures for investigating complaints. Such procedures shall require the agency to initiate a complaint investigation within ten days of the agency's receipt of the complaint and to document all components of the investigation; (36) maintaining a current medication list and medication administration record; (37) specifying the qualifications, experience, and training in pediatrics required for any registered nurse who provides or supervises direct care staff in the provision of services to pediatric clients; and (38) relating to the possession of sterile water or saline, certain vaccines or tuberculin, and certain dangerous drugs. The policy must comply with the provisions in subsection (g) of this section. (d) - (f) (No change.) (g) Possession of sterile water or saline, certain vaccines or tuberculin, and certain dangerous drugs. (1) Possession of sterile water or saline. An agency or its employees who are registered nurses or licensed vocational nurses may purchase, store, or transport for the purpose of administering to their home health or hospice clients under physician's orders: (A) sterile water for injection and irrigation; and (B) sterile saline for injection and irrigation. (2) Possession of certain vaccines or tuberculin. (A) An agency or its employees who are registered nurses or licensed vocational nurses may purchase, store, or transport for the purpose of administering to the agency's employees, home health, or hospice clients, or client family members under physician's standing orders the following dangerous drugs: (i) hepatitis B vaccine; (ii) influenza vaccine; and (iii) tuberculin purified protein derivative for tuberculosis testing. (B) An agency that purchases, stores, or transports a vaccine or tuberculin under this section shall ensure that any standing order for the vaccine or tuberculin: (i) is signed and dated by the physician; (ii) identifies the vaccine or tuberculin covered by the order; (iii) indicates that the recipient of the vaccine or tuberculin has been assessed as an appropriate candidate to receive the vaccine or tuberculin and has been assessed for the absence of any contraindication; (iv) indicates that appropriate procedures are established for responding to any negative reaction to the vaccine or tuberculin; and (v) orders that a specific medication or category of medication be administered if the recipient has a negative reaction to the vaccine or tuberculin. (3) Possession of certain dangerous drugs. (A) An agency or its employees who are registered nurses or licensed vocational nurses may purchase, store, or transport for the purpose of administering to their home health or hospice patients in accordance with subparagraph (C) of this paragraph the following dangerous drugs: (i) any of the following items in a sealed portable container of a size determined by the dispensing pharmacist: (ii) 1,000 milliliters of 0.9% sodium chloride intravenous infusion; (iii) 1,000 milliliters of 5.0% dextrose in water injection; or (iv) sterile saline; or (v) not more than five dosage units of any of the following items in an individually sealed, unused portable container: (I) heparin sodium lock flush in a concentration of ten units per milliliter or 100 units per milliliter; (II) epinephrine HCl solution in a concentration of one to 1,000; (III) diphenhydramine HCl solution in a concentration of 50 milligrams per milliliter; (IV) methylprednisolone in a concentration of 125 milligrams per two milliliters; (V) naloxone in a concentration of one milligram per milliliter in a two- milliliter vial; (VI) promethazine in a concentration of 25 milligrams per milliliter; (VII) glucagon in a concentration of one milligram per milliliter; (VIII) furosemide in a concentration of ten milligrams per milliliter; (IX) lidocaine 2.5% and prilocaine 2.5% cream in a five-gram tube; or (X) lidocaine HCl solution in a concentration of 1% in a two-milliliter vial. (B) An agency or the agency's authorized employees may purchase, store, or transport dangerous drugs in a sealed portable container only if the agency has established policies and procedures to ensure that: (i) the container is handled properly with respect to storage, transportation, and temperature stability; (ii) a drug is removed from the container only on a physician's written or oral order; (iii) the administration of any drug in the container is performed in accordance with a specific treatment protocol; and (iv) the agency maintains a written record of the dates and times the container is in the possession of a registered nurse or licensed vocational nurse. (C) An agency or the agency's authorized employee who administers a drug listed in subparagraph (A) of this paragraph may administer the drug only in the client's residence under physician's orders in connection with the provision of emergency treatment or the adjustment of: (i) parenteral drug therapy; or (ii) vaccine or tuberculin administration. (D) If an agency or the agency's authorized employee administers a drug listed in subparagraph (A) of this paragraph pursuant to a physician's oral order, the agency shall ensure the physician promptly sends a signed copy of the order to the agency, and the agency shall: (i) not later than 24 hours after receipt of the order, reduce the order to written form and send a copy of the form to the dispensing pharmacy by mail or facsimile transmission; and (ii) not later than 20 days after receipt of the order, send a copy of the order as signed by and received from the physician to the dispensing pharmacy. (E) A pharmacist that dispenses a sealed portable container under this subsection will ensure that the container: (i) is designed to allow access to the contents of the container only if a tamper-proof seal is broken; (ii) bears a label that lists the drugs in the container and provides notice of the container's expiration date, which is the earlier of: (I) the date that is six months after the date on which the container is dispensed; or (II) the earliest expiration date of any drug in the container; and (iii) remains in the pharmacy or under the control of a pharmacist, registered nurse, or licensed vocational nurse. (F) If an agency or the agency's authorized employee purchases, stores, or transports a sealed portable container under this subsection, the agency shall deliver the container to the dispensing pharmacy for verification of drug quality, quantity, integrity, and expiration dates not later than the earlier of: (i) the seventh day after the date on which the seal on the container is broken; or (ii) the date for which notice is provided on the container label. (G) A pharmacy that dispenses a sealed portable container under this subsection is required to take reasonable precautionary measures to ensure that the agency receiving the container complies with subparagraph (F) of this paragraph. On receipt of a container under subparagraph (F) of this paragraph, the pharmacy will perform an inventory of the drugs used from the container and will restock and reseal the container before delivering the container to the agency for reuse. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9801934 Susan K. Steeg General Counsel Texas Department of Health Effective date: March 2, 1998 Proposal publication date: December 5, 1997 For further information, please call: (512) 458-7236 SUBCHAPTER D.Enforcement 25 TAC sec.115.51, sec.115.52 The amendments are adopted under the Health and Safety Code, sec.142.004(c) which provides the board with the authority to adopt rules to require an applicant for an HCSSA license to provide identifying information on the HCSSA owner, administrator, and chief financial officer to enable the department to conduct criminal background checks on those persons; sec.142.011 which provides the board with the authority to adopt minimum standards governing the licensing of HCSSAs; sec.142.017(c) which provides the board with the authority to specify by rule each violation for which an administrative penalty may be assessed; sec.142.017(d) which requires the board to establish by rule a schedule of appropriate and graduated penalties for each violation based upon certain criteria; sec.142.017(e) which requires the board by rule to provide an HCSSA with a reasonable period of time following the first day of a violation to correct the violation before assessing an administrative penalty if a plan of correction has been implemented; and under sec.12.001 which provides the board with the authority to adopt rules for the performance of every duty imposed by law upon the board, the department, and the commissioner of health. sec.115.52.Enforcement Action. (a) License denial, suspension or revocation. (1) The Texas Department of Health (department) may deny, suspend, suspend on an emergency basis, or revoke a license issued to an applicant or agency if the applicant or agency: (A) fails to comply with any provision of the statute; (B) fails to comply with any provision of this chapter; (C) has a provider agreement under the Social Security Act, Title XVIII, which has been terminated by the certifying body, Health Care Financing Administration, or if the agency withdraws its certification or its request for certification. An agency providing licensed and certified home health services that submits a request for a hearing as provided by this section is governed by the requirements of the statute and the rules relating to an agency providing licensed only home health services until suspension or revocation is finally determined by the department or, if the license is suspended or revoked, until the last day for seeking review of the department order or a later date fixed by order of the reviewing court; (D) commits fraud, misrepresentation, or concealment of a material fact on any documents required to be submitted to the department or required to be maintained by the agency pursuant to this chapter; (E) has aided, abetted, or permitted the commission of an illegal act; (F) fails to provide the required application or renewal information; (G) fails to comply with an order of the commissioner of health or another enforcement procedure under the statute; (H) discloses action as described in sec.115.11(g)(2)(R) and (S) of this title (relating to Application and Issuance of Initial License) or sec.115.12(b)(2)(A) of this title (relating to Issuance and Renewal of License); (I) fails to comply with the Human Resources Code, Chapter 102 (relating to Rights to the Elderly); or (J) knowingly employs as the agency administrator or chief financial officer an individual who was convicted of a felony or misdemeanor listed in paragraph (2) of this subsection. (2) The department may suspend or revoke an existing valid license or disqualify a person from receiving a license because of a person's conviction of a felony or misdemeanor if the crime directly relates to the duties and responsibilities of a licensed agency. (A) In determining whether a criminal conviction directly relates, the department shall consider the provisions of Texas Civil Statutes, Article 6252- 13c. (B) The following felonies and misdemeanors directly relate because these criminal offenses indicate an inability or a tendency for the person to be unable to own or operate an agency. These offenses also relate to the holding of a home health medication aide permit or an entity approved under sec.115.62(o) of this title (relating to Home Health Medication Aides), to conduct a home health medication aide training program: (i) a misdemeanor violation of the statute; (ii) a conviction relating to deceptive business practices; (iii) a misdemeanor or felony offense involving moral turpitude; (iv) the misdemeanor of practicing any health-related profession without a required license; (v) a conviction under any federal or state law relating to drugs, dangerous drugs or controlled substances; (vi) an offense under the Texas Penal Code involving a client or client of a health care facility or agency; (vii) Texas Penal Code, Chapter 19 concerning criminal homicide; (viii) Texas Penal Code, Chapter 20 concerning kidnapping and false imprisonment; (ix) Texas Penal Code, sec.21.11 concerning indecency with a child; (x) Texas Penal Code, sec.22.011 concerning sexual assault; (xi) Texas Penal Code, sec.22.02 concerning aggravated assault; (xii) Texas Penal Code, sec.22.04 concerning injury to a child, elderly individual, or disabled individual; (xiii) Texas Penal Code, sec.22.041 concerning abandoning or endangering child; (xiv) Texas Penal Code, sec.22.08 concerning aiding suicide; (xv) Texas Penal Code, sec.25.031 concerning agreement to abduct from custody; (xvi) Texas Penal Code, sec.25.08 concerning sale or purchase of a child; (xvii) Texas Penal Code, sec.28.02 concerning arson; (xviii) Texas Penal Code, sec.29.02 concerning robbery; (xix) Texas Penal Code, sec.29.03 concerning aggravated robbery; (xx) a misdemeanor or felony offense under the Texas Penal Code, as follows: (I) Title 5, concerning offenses against the person; (II) Title 7, concerning offenses against property; (III) Title 9, concerning offenses against public order and decency; (IV) Title 10, concerning offenses against public health, safety, and morals; and (V) Title 4, concerning offenses of attempting or conspiring to commit any of the offenses in clauses (i)-(xxi) of this subparagraph; and (xxi) other misdemeanors and felonies which indicate an inability or tendency for the person to be unable to own or operate an agency, hold a permit, or receive program approval under sec.115.62(o) of this title (relating to Home Health Medication Aides), if action by the department will promote the intent of the statute, this chapter, or Texas Civil Statutes, Article 6252-13c. (C) Upon a licensee's felony conviction, felony probation revocation, revocation of parole, or revocation of mandatory supervision, the license shall be revoked. (3) If the department proposes to deny, suspend, or revoke a license, the department shall notify the agency by certified mail, return receipt requested, or personal delivery of the reasons for the proposed action and offer the agency an opportunity for a hearing. If a notice served by mail is returned undeliverable or the department is unable to execute personal delivery of the notice, the department may publish the notice in a newspaper of general circulation serving the county in which the agency is located based upon the last address provided by the agency. Publication of the notice shall be for seven consecutive calendar days. An agency which fails to claim a notice sent by certified mail or refuses to accept the notice does not make the notice null and void. (A) The agency must request a hearing within 20 calendar days of receipt of the notice. Receipt of the notice is presumed to occur on the tenth day after the notice is mailed to the last address known to the department unless another date is reflected on a United States Postal Service return receipt. (B) The request for a hearing must be in writing and submitted to the Director, Health Facility Licensing Division, Texas Department of Health, 1100 West 49th Street, Austin, Texas 78756. (C) A hearing shall be conducted pursuant to the Administrative Procedure Act, Texas Government Code, Chapter 2001, and the department's formal hearing procedures in Chapter 1 of this title (relating to the Texas Board of Health). (D) If the agency does not request a hearing in writing within 20 calendar days of receipt of the notice, the agency is deemed to have waived the opportunity for a hearing and the proposed action shall be taken. (E) If the agency fails to appear or be represented at the scheduled hearing, the agency has waived the right to a hearing and the proposed action shall be taken. (4) The department may suspend or revoke a license to be effective immediately when the health and safety of persons are threatened. The department shall immediately give the chief executive officer of the agency adequate notice of the action taken, the legal grounds for the action, and the procedure governing appeal of the action. The department shall also notify the agency of the emergency action including the legal grounds for the action and the procedure governing appeal of the action by certified mail, return receipt requested, or personal delivery of the notice and of the date of a hearing, which shall be not later than seven calendar days after the effective date of the suspension or revocation. The effective date of the emergency action shall be stated in the notice. The hearing shall be conducted pursuant to the Administrative Procedure Act, Texas Government Code, Chapter 2001, and the department's formal hearing procedures in Chapter 1 of this title (relating to the Texas Board of Health). (5) If an agency has had enforcement action taken by the department against the agency, the agency, its owner(s), or its affiliate(s) may not apply for an agency license for one year following the effective date of the enforcement action. For purposes of this paragraph only, the term "enforcement action" means license revocation, suspension, emergency suspension, or denial or injunctive action but does not include administrative penalties or civil penalties. If the department prevails in one enforcement action (e.g. injunctive action) against the agency but also proceeds with another enforcement action (e.g., revocation) based on some or all of the same violations, but the department does not prevail in the second enforcement action (e.g., the agency prevails), the prohibition in this paragraph does not apply. (6) If the department suspends a license, the suspension shall remain in effect until the department determines that the reason for suspension no longer exists. An authorized representative of the department shall conduct a survey of the agency prior to making a determination. (A) During the time of suspension, the suspended license holder shall return the license to the department. (B) If a suspension overlaps a renewal date, the suspended license holder shall comply with the renewal procedures in this chapter; however, the department may not renew the license until the department determines that the reason for suspension no longer exists. (C) If suspension is for more than one year, the suspended license holder may apply to the department for cancellation of the suspension only after one year following the initial date of the suspension. (7) If the department revokes or does not renew a license and the one-year period described in paragraph (5) of this subsection has passed, a person may reapply for a license by complying with the requirements and procedures in this chapter at the time of reapplication. The department may refuse to issue a license if the reason for revocation or nonrenewal continues to exist. (8) Upon revocation or nonrenewal, a license holder shall return the license to the department. (b) Administrative penalties. (1) General. The department may assess an administrative penalty against a person who violates the statute or this chapter. A person under this subsection includes: (A) a licensed agency; (B) an unlicensed agency operating without a license; (C) any person who is not authorized to use the word hospice; (D) any person who acts as a home health medication aide in violation of the statute; and (E) any person who conducts a home health medication aide training program in violation of the statute or this chapter. (2) Assessment of a penalty. (A) Notwithstanding any other provision of the statute, the department may not assess an administrative penalty against an agency: (i) that provides only long-term care Medicaid waiver services that are publicly funded and is certified and monitored by a state agency that has developed standards that ensure the health and safety of service recipients; or (ii) that provides home health, hospice, or personal assistance services only to persons enrolled in a program that is funded in whole or in part by the Texas Department of Mental Health and Mental Retardation (TXMHMR) and is monitored by the TXMHMR or its designated local authority in accordance with standards set by the TXMHMR. (B) The assessment of an administrative penalty shall be in accordance with the schedule of appropriate and graduated penalties described in paragraph (4) of this subsection. The schedule of appropriate and graduated penalties for each violation is based on the following criteria: (i) the seriousness of the violation, including the nature, circumstances, extent, and gravity of the violation, and the hazard of the violation to the health or safety of clients; (ii) the history of previous violations; (iii) whether the affected home and community support services agency had identified the violation as part of its internal quality assurance process and had made appropriate progress on correction. For purposes of this subsection, appropriate progress is defined as making a good faith, substantial effort to correct the violation in a timely manner; (iv) the amount necessary to deter future violations; (v) efforts made to correct the violation; and (vi) any others matters that justice may require. (C) In determining which violation(s) warrants a penalty(ies), the department will consider: (i) the seriousness of the violation(s), including the nature, circumstances, extent, and gravity of the violation(s), and the hazard of the violation(s) to the health or safety of a client; and (ii) whether the affected agency had identified the violation(s) as part of its internal quality assurance process and had made appropriate progress on correction. (D) An administrative penalty may be assessed only for a violation occurring after the effective date of this subsection. An administrative penalty for a subsequent occurrence may only be assessed when the subsequent occurrence occurs within three years from the date the agency first receives oral or written notice of the first violation. (E) The assessment of an administrative penalty does not preclude the department from suspending, revoking, or denying a license in accordance with subsection (a) of this section. (3) Correction period. (A) Following the first day of a violation, an agency shall be given a reasonable period of time to correct the violation. The period of time must be reflected in and implemented through an accepted plan of correction. A reasonable period of time for purposes of this subsection shall be as follows. (i) For a violation that results in serious harm to or death of a client, constitutes an actual serious threat to the health or safety of a client, or substantially limits the agency's capacity to provide care, the violation must be corrected immediately or no later than seven calendar days from the first time the agency is informed (orally or in writing) by department staff of the violation. This is a severity level II violation. (ii) For a violation that has or had minor or no health or safety significance, the violation must be corrected within 20 calendar days from receipt of the written notice of the violation (e.g. statement of deficiencies). This is a severity level I violation. (iii) An agency may request an extension in writing. An agency may receive an extension upon approval of the department. An extension is only appropriate if the agency has made a good faith effort to correct the violation within the required time period but has not been able to correct due to circumstances beyond their control and if there is no serious harm or threat to clients. (B) If an agency corrects the violation within the time periods described in subparagraph (A) of this paragraph, the department may assess an administrative penalty only for one level II violation that occurred before the day on which the agency received written notice of the violation (e.g., statement of deficiencies). No administrative penalty would be assessed for a level I violation. (C) A penalty(ies) assessed under this subsection may be a severity level I penalty(ies) or a severity level II penalty(ies) or a combination of a severity level I penalty(ies) and severity level II penalty(ies). If an agency does not correct the violation within the time periods described in subparagraph (A) of this paragraph, the department may assess an administrative penalty for: (i) one violation that occurred before the day on which the agency received written notice of the violation (e.g., statement of deficiencies); and (ii) for each day of the violation during the correction period and after the time period for correction has ended. (4) Schedule of penalties. (A) Minimum and maximum amount. An administrative penalty shall not be less than $100 or more than $1,000 for each violation. (B) Subject matter considered. If two or more of the rules listed in subparagraphs (C) and (D) of this paragraph relate to the same or similar subject matter, only one administrative penalty shall be assessed at the higher severity level violation. (C) Severity level I. A severity level I violation is a violation that has or has had minor or no client health or safety significance. (i) The penalty for a severity level I violation is assessed only if the violation is of a continuing nature or the violation was not corrected in accordance with the accepted plan of correction. The department is not required to provide the agency an opportunity to correct subsequent violations under this subsection. (ii) The penalty for a severity level I violation is $100 - $250. (iii) A violation of each of the rules listed in the following table may warrant a severity level I administrative penalty. Figure 1: 25 TAC sec.115.52(b)(4)(C)(iii) (D) Severity level II. (i) The penalty for a severity level II violation shall be assessed according to following schedule: (I) for a violation that results in serious harm to or death of a client, the penalty shall be $1,000; (II) for a violation that constitutes an actual serious threat to the health or safety of a client, the penalty shall be $500 to $1,000; or (III) for a violation that substantially limits the agency's capacity to provide care, the penalty shall be $500 to $750. (ii) The department may assess a separate level II administrative penalty for a violation of each of the rules listed in the following table. Figure 2: 25 TAC sec.115.52(b)(4)(D)(ii) (5) Notice of violation. After investigation of a possible violation and the facts surrounding that possible violation and the after the agency's receipt of the statement of deficiencies, if the department determines that a violation has occurred, the department will give further written notice (e.g., a notice of violation letter) to the person alleged to have committed the violation. (A) The notice shall include: (i) a brief summary of the alleged violation(s); (ii) a statement of the amount of the proposed penalty based on the factors listed in paragraph (2) of this subsection; and (iii) a statement of the person's right to a hearing on the occurrence of the violation(s), the amount of the penalty, or both the occurrence of the violation(s) and the amount of the penalty. (B) Not later than the 20th calendar day after the date on which the notice is received, the person notified may accept the determination of the department made under this subsection, including the proposed penalty amount, or may make a written request for a hearing on that determination. A person's acceptance of the department's determination means that the person has sent and the department has received a written acceptance notice accompanied by remittance of the proposed penalty. (C) If the person notified of the violation accepts the determination of the department or if the person fails to respond in a timely manner to the notice, the commissioner or the commissioner's designee shall issue an order approving the determination and ordering that the person pay the proposed penalty. (D) If the person requests a hearing, procedures shall be in accordance with the statute, sec.sec.142.0172 - 142.0173 and the department's formal hearing procedures in Chapter 1 of this title (relating to the Texas Board of Health). (c) Court action. (1) If a person operates an agency without a license issued under the Act, the person is liable for a civil penalty of not less than $1,000 or more than $2,500 for each day of violation. (2) If a person violates the licensing requirements of the statute, the department may petition the district court to restrain the person from continuing the violation. (d) Surrender or expiration of license. (1) After a survey in which deficiencies were cited by the surveyor, an agency may surrender its license before expiration or allow its license to expire in lieu of the department proceeding with enforcement action. (2) An agency may surrender before the expiration date by returning its original license to the department. (3) If an agency surrenders or allows expiration of the license, the agency, its owner(s), and its affiliate(s) may not reapply for a license for six months from the date of the surrender or expiration. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9801933 Susan K. Steeg General Counsel Texas Department of Health Effective date: March 2, 1998 Proposal publication date: December 5, 1997 For further information, please call: (512) 458-7236 CHAPTER 241.Shellfish Sanitation The Texas Department of Health (department), by majority vote of the Texas Board of Health (board) on February 8, 1998, enters this order finally adopting the repeal of sec.241.1, sec.241.2 and sec.sec.241.4-241.29 and new sec.sec.241.1 - 241.7, concerning Texas crab meat. Sections 241.1, 241.3, and 241.4 are adopted with changes to the proposed text as published in the December 12, 1997, issue of the Texas Register (22 TexReg 12217). Sections 241.2, 241.5, 241.6, 241.7 and the repeals are adopted without changes, and therefore the sections will not be republished. The new sections cover definitions; grounds and arrangements; sanitary controls; water supplies; storage areas; processing of crab meat; maintenance and cleaning; records and supervision; and also include requirements established by the U.S. Food and Drug Administration's Fish and Fishery Products Hazard Analysis and Critical Control Point (HACCP) regulations (Code of Federal Regulations, Title 21, Part 123). This action is necessary because of the new federally mandated HACCP requirements. These rules are essential for the proper regulation of the crab meat industry. The following comment was received concerning the proposed sections. Following the comment is the department's response and resulting change. Comment: Concerning sec.241.7(a), an individual commenter requested that the term "cook lot" be defined. Response: The department agrees with the commenter and has added a definition in sec.241.1 to clarify sec.241.7(a) which states in part "crab meat can be traced to the specific cook lot in which it was processed". The department is making the following minor changes due to staff comments to clarify the intent and improve the accuracy of the sections. Change: Concerning adopted sec.241.1 Definitions, the definition of "approved" was deleted due to the lack of needing a definition. Change: Concerning adopted sec.241.1 Definitions, in the definition of "license number" the word "the" was added in the first sentence to be grammatically correct. Change: Concerning adopted sec.241.1 Definitions, the definition of "other deficiency" was corrected from "more a" to "a more". Change: Concerning adopted sec.241.3(a) Licensing Requirements, the phrase "which is acceptable to the SSD" was added to the end of the paragraph. Change: Concerning adopted sec.241.3(j)(2)(C) Licensing Requirements, was changed to read "the license holder does not have a HACCP plan, has a HACCP plan unacceptable to the SSD, or fails to comply with a HACCP plan which is acceptable to the SSD" . Change: Concerning adopted sec.241.3(o)(1)(C) Licensing Requirements, the "&" was replaced with the word "and". Change: Concerning adopted sec.241.3(o)(2)(I) Licensing Requirements, the "0o F." was changed to read "0 degrees Fahrenheit". Change: Concerning adopted sec.241.3(o)(5)(G) Licensing Requirements, the "40o F." was changed to read "40 degrees Fahrenheit". Change: Concerning adopted sec.241.3(p)(4) Licensing Requirements, the first sentence needed a comma after "Chapter 436" to be grammatically correct. Change: Concerning adopted sec.241.3(q) Licensing Requirements, the first sentence needed a comma after the word "Code" to be grammatically correct. Change: Concerning adopted sec.241.4(b) General HACCP Requirements, the first sentence was changed to read "Every dealer shall have, implement, and comply with a written HACCP plan which is acceptable to the SSD". The commenter was an individual who was generally in favor of the rules. The changes were made due to staff comments. Texas Crab Meat 25 TAC sec.sec.241.1, 241.2, 241.4-241.29 The repeals are adopted under Health and Safety Code, sec.sec.436.112 and 12.001, which provides the Board of Health (board) with the authority to adopt rules for the performance of every duty imposed by law on the (board), the department, and the commissioner of health. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 9, 1998. TRD-9801867 Susan K. Steeg General Counsel Texas Department of Health Effective date: March 1, 1998 Proposal publication date: December 12, 1997 For further information, please call: (512) 458-7236 25 TAC sec.sec.241.1-241.7 The new sections are adopted under Health and Safety Code, sec.sec.436.112 and 12.001, which provides the Board of Health (board) with the authority to adopt rules for the performance of every duty imposed by law on the (board), the department, and the commissioner of health. sec.241.1.Definitions. The following words and terms, when used in these sections, shall have the following meaning unless the context clearly indicates otherwise. Authorized agent - An employee of the Texas Department of Health who is designated by the Commissioner to enforce provisions of these sections. Commissioner - The commissioner of health for the State of Texas. Compliance schedule- A written schedule that provides a correction time period to eliminate key and other deficiencies. Container- The physical material in contact with or immediately surrounding the crab meat that confines it into a single unit. Cook lot - All of the crab meat product cooked in one day at one location. Crab meat - The edible meat of steamed or cooked crabs that has not been processed other than by picking, packing, and chilling. Critical Control Point (CCP) - A point, step or procedure in a food process at which control can be applied, and a food safety hazard can as a result be prevented, eliminated or reduced to acceptable levels. Critical deficiency - A condition or practice which: (A) results in the production of a product that is unwholesome; or (B) presents a threat to the health or safety of the consumer. Critical limit - The maximum or minimum value to which a physical, biological, or chemical parameter must be controlled at a critical control point to prevent, eliminate or reduce to an acceptable level the occurrence of the identified food safety hazard. Dealer- A person to whom a license is issued for the activities of crab meat picking and packing or crab meat picking, packing, and pasteurization. Department - The Texas Department of Health, 1100 West 49th Street, Austin, Texas, 78756, or its successor state agency, having the responsibility for the enforcement of laws concerning the safety of the food supply including regulating the processing, picking, packing, pasteurization, and/or shipping of crab meat. Food safety hazard - Any biological, chemical, or physical property that may cause a food to be unsafe for human consumption. HACCP - Hazard Analysis Critical Control Point, a systematic, science-based approach used in food production as a means to assure food safety. The concept is built upon the seven principles identified by the National Advisory Committee on Microbiological Criteria for Foods (1992). HACCP Plan - A written document that delineates the formal procedures that a dealer follows to implement the HACCP requirements set forth in Code of Federal Regulations, Title 21, sec.123.6. Key deficiency - A condition or practice which may result in adulterated, decomposed, misbranded or unwholesome product. Label- Any written, printed or graphic matter affixed to or appearing upon any package containing crab meat. License - A numbered document issued by the department which authorizes a dealer to process crab meat for sale. License number- The unique identification number issued by the department to each dealer for each location. Each license number shall consist of a one to five digit Arabic number preceded by the two letter State abbreviation and followed by a one or two letter abbreviation for the type of activity or activities the dealer is qualified to perform in accordance with the following terms: (A) crab meat picking and packing (C); or (B) crab meat picking, packing, and pasteurization (CP). Licensed location - A plant or place of business which has been inspected by the Seafood Safety Division and for which a crab meat processing license has been issued. Other deficiency - A condition or practice that is not defined as critical or key, but is of a public health significance and, if left uncorrected, could result in a more serious violation. Packing - The placing of crab meat into containers for off-premise consumption. Pasteurization plant - A place where crab meat is heat-treated, without complete sterilization, to improve keeping qualities of the meat. Pasteurized crab meat - The meat of crabs cooked, picked, and packed for off- premise consumption which has been heat treated, without complete sterilization, to improve keeping qualities of the meat. Person- Any individual, receiver, trustee, guardian, personal representative, fiduciary, or representative of any kind, government or governmental subdivision or agency, partnership, association, corporation or other legal entity. Pick(ing) - The removal of crab meat from the crab shell. Picking plant - A place where crabs are cooked and edible meat is picked therefrom. Principal display panel - The part of a label that is most likely to be displayed, presented, shown or examined under customary conditions of retail sale. Sanitation control record - Records that document the monitoring of sanitation practices and conditions. Sewer - An artificial, usually subterranean, conduit to carry off sewage and/or surface water. SSD- The Seafood Safety Division of the Texas Department of Health to which responsibility for regulating the processing, picking, packing, pasteurization, and/or shipping of crab meat is delegated. sec.241.3.Licensing Requirements. (a) No person shall engage in any activity requiring a license under sec.sec.241.1-241.7 of this title (relating to Texas Crab Meat) without having applied for and obtained an annual numbered license pertaining to the particular activity from the department. No license will be issued without a HACCP plan in accordance with sec.241.4 of this title (relating to General HACCP Requirements) which is acceptable to the SSD. (b) Dealer Licensing. (1) Picker-Packer. Any person who cooks crabs, and picks and packs the crab meat shall be licensed as a picker-packer. (2) Pasteurizer. Any person who cooks crabs, picks, packs, and pasteurizes the crab meat, or pasteurizes crab meat picked and packed in another location shall be licensed as a pasteurizer. (c) Prior to beginning construction of a new crab meat plant, or major remodeling of an existing crab meat plant (which includes, but is not limited to: any process new to that particular plant; any change of product flow; or any enlarging of the plant structure) complete, legible plans showing the floor plan of the building, with dimensions drawn to scale, location of equipment, doors, floor drains, etc., and written, complete operational procedures for all phases of the activity, including flow of the product, shall be submitted to the department, SSD, for review and approval. Additional plans of the entire premises may be required showing all structures, as well as, all water wells and septic systems with related distances and a statement of specifications as to type, sizes, design, date installed, etc. Plans shall be submitted no less than 30 days prior to initiating a new process or beginning construction. No operations shall be conducted while any inside plant construction or any other construction which has the potential to contaminate the product is occurring. (d) A legibly written or typed application on forms provided by the department must be filed with the SSD each year. (e) If the applicant proposes to use a date other than an open date, the application for a license must be accompanied by a written statement of the procedure the applicant will use to determine the date to be included on the label for crab meat packed or pasteurized and shipped from the location listed in the application. (f) A license and unique number shall be issued by the commissioner only after an inspection of the plant by an authorized agent has revealed that the plant and practices are in compliance with these sections. A license and unique number shall be issued to a dealer for each location at which crab meat operations are to be conducted and a license is required. (g) The inspection of a previously licensed plant which has exhibited operational problems or violations of operational requirements of these sections or had a license revoked shall not be conducted until written, complete operational procedures for all phases of the activity, including flow of the product, are submitted to the SSD for review and approval. An application may be rejected and a license denied based on a history of failure to comply with the requirements of these sections. (h) Crab meat operations by the dealer shall not begin until the commissioner has issued the Crab Meat Processing License for that location. Each license shall expire automatically at 11:59 p.m. the last day of February following the date of issue. Licenses shall not be transferable. (i) After a license is issued, unannounced inspections may be conducted at any time the SSD has reason to believe the business may be in operation or that crab meat may be stored on the premises and at such frequency as may be necessary to assure that adequate operational and sanitary conditions are maintained. All crab meat at a licensed location shall be the responsibility of the dealer at that location for the purposes of these sections. A copy of the completed inspection form listing written descriptions of the violations observed along with any necessary explanation shall be provided by an authorized agent of the department to the most responsible individual present at the firm at the conclusion of the inspection. Any violations of the same requirement found on a consecutive inspection may result in license suspension in accordance with subsection (j) of this section. (1) When a routine inspection detects a critical deficiency the violation shall be corrected during that inspection or the plant must cease production affected by the violation. If production affected by the violation does not voluntarily cease, all crab meat handled or processed while the violation exists or existed shall be detained. (2) When a routine inspection detects four or more key deficiencies, the dealer shall establish a correction schedule acceptable to the SSD. The follow-up inspection shall determine if the violations have been corrected or are being corrected in accordance with the scheduled correction dates noted on the previous inspection report. (3) When a routine inspection detects other deficiencies or three or less key deficiencies, the deficiencies shall be corrected prior to the next routine inspection. (j) The SSD may initiate procedures to suspend or to revoke a license or assess administrative penalties as follows: (1) The procedures shall be in accordance with the Texas Health and Safety Code, sec.436.114; the provisions of the Government Code, Chapter 2001, Administrative Procedure Act; and the department formal hearing procedures in Chapter 1 of this title (relating to the Board of Health). (2) The grounds for suspension or revocation or assessment of administrative penalties may be any one of the following: (A) inspection results indicate unsatisfactory conditions in the plant or the existence of a public health hazard; (B) the license holder or representative refuses to allow an inspection or otherwise interferes with the authorized department's agent in the performance of his or her duties; or (C) the license holder does not have a HACCP plan, has a HACCP plan unacceptable to the SSD, or fails to comply with a HACCP plan which is acceptable to the SSD. (k) A dealer whose license has been suspended may not process any crab meat for a period determined by the commissioner. (l) A dealer whose license has been suspended may not process any crab meat until the SSD is satisfied that all necessary corrections have been made. A suspension will not be rescinded until an inspection establishes that the firm has corrected all violations which resulted in the suspension and is in full compliance with all applicable criteria of these sections. (m) A license may be revoked for any of the reasons outlined in subsection (j) of this section or for either of the following: if the violations initiating a suspension fail to be corrected within the time frame established, or if a history of repeated suspensions exists. A dealer whose license has been revoked shall not be issued a new license for 180 days or before the next licensing period, whichever is longer, after the date of signing of the final order of revocation. When the department contemplates suspension or revocation, the license holder shall be afforded the opportunity for a hearing. Notice of the contemplated action shall be given to the license holder by personal service or certified mail, return receipt requested. If no request for a hearing is received by the director of the SSD, within 14 days of personal service or the date of receipt of the notice by the dealer, the allegations contained in the notice are admitted as true, and the department may proceed to take the action set out in the notice. (n) When the department determines that administrative penalties are appropriate, proposals for assessment of and hearings on administrative penalties shall be made in accordance with the Texas Health and Safety Code, sec.436.034; the provisions of the Government Code, Chapter 2001, Administrative Procedure Act; and the department formal hearing procedures in Chapter 1 of this title (relating to the Board of Health). When the department contemplates administrative penalties, the license holder shall be afforded the opportunity for a hearing. Notice of the contemplated action shall be given to the license holder by personal service or certified mail, return receipt requested. If no request for a hearing is received by the director of the SSD, within 14 days of personal service or the date of receipt of the notice by the dealer, the allegations contained in the notice are admitted as true, and the department may proceed to take the action set out in the notice. (o) The seriousness of violations shall be categorized by one of the following severity levels. The examples following the severity levels are neither exhaustive nor controlling. They reflect only the seriousness of the violation and not the intent of the violator, the history of the violator, the amount necessary to deter future violations, or efforts to correct the violation. (1) Severity Level I - violations that are of minor public health significance. The following are examples of severity level I violations (other deficiency): (A) failure to keep premises clean and have adequate drainage; (B) failure to clean/maintain floors, walls, or ceilings; (C) failure to provide adequate and properly shielded lighting; (D) failure to post hand washing signs at hand washing stations; and (E) failure to restrict pickers from the packing room and all unauthorized persons from processing areas when operating. (2) Severity Level II - Violations that are of more than minor significance, or if left uncorrected, could result in more serious violations. The following are examples of severity level II violations (other deficiency): (A) failure to provide or use storage for employee clothing or personal articles; (B) failure to have clean, maintained, adequately drained floor; (C) failure to provide adequate heating/cooling/ventilation; (D) failure to provide adequate quantity of water to facility; (E) failure to provide hand washing stations with soap, sanitary towels, and/or waste receptacles with proper lids; (F) failure to properly construct, locate, maintain, and/or keep clean all non- food contact surfaces; (G) failure to provide detergents, approved sanitizers, brushes, and/or test kit to properly clean and sanitize the facility; (H) failure to properly store and/or keep clean single service containers; (I) failure to maintain frozen crab meat at 0 degrees Fahrenheit or less; (J) failure to require employees to wear clean outer garments, impermeable gloves/finger cots; to store properly; to wear proper hair restraints; (K) failure to promptly remove crab scrap or other accumulation; and (L) failure to meet code and/or install water disposal correctly or have adequate drainage where operations discharge water. (3) Severity Level III - Violations that are significant and which, if not corrected, could threaten public health. The following are examples of severity level III violations (key deficiency): (A) failure to exclude insects, rodents, vermin, or any other animals; (B) failure to provide hot and cold water at each sink/lavatory; (C) failure to protect plumbing from backflow, backsiphonage, and/or cross contamination; (D) failure to have toilets clean, repaired, and/or have self-closing doors; (E) failure to properly use, store, separate, and/or label poisonous/toxic materials; (F) failure to properly construct, locate, clean, and/or maintain food contact surfaces; (G) failure to provide a temperature measuring device in each refrigeration unit; (H) failure of employees to wash/sanitize their hands and/or exhibit good hygienic practices; (I) failure to restrict any personnel with infections that may be transmitted through the crab meat from participating in crab meat operations; and (J) failure to maintain complete and accurate records. (4) Severity Level IV - Violations that have a significant adverse impact on public health. The following are examples of severity level IV violations (key deficiency): (A) failure to separate operations by partition, space, or time; (B) failure to provide adequate refrigeration units; (C) failure to clean and sanitize food contact surfaces effectively and within required time frame; (D) failure to label crab meat or properly complete label; (E) failure to protect crab meat from contamination; (F) failure to pack into containers with a valid license number for that location; comply with label requirements; to use proper date; (G) failure to promptly pick, pack, pasteurize, and/or protect crab meat; and (H) failure to have responsible, effective, or designated person as supervisor. (5) Severity Level V - Violations that are most significant and create an imminent hazard to public health. The following are examples of severity level V violations (critical deficiency): (A) failure to cease operations when location/plant is flooded; (B) failure to protect the water supply from contamination; (C) failure to install and/or maintain adequate sewage disposal system; (D) failure to maintain crab meat at the proper temperature; (E) failure to keep crab meat from becoming contaminated; (F) failure to cool packed crab meat promptly; (G) failure to maintain packed crab meat at 40 degrees Fahrenheit or less during storage; and (H) failure to provide sanitary ice and/or properly protect it. (p) The department may impose differing levels of penalties for different severity level violations. (1) Administrative penalties shall be imposed for Severity Level III, IV and V violations. Administrative penalties may be assessed for Severity Level I and II violations when they are combined with those of higher severity level(s) or for repeated violations which could have been prevented by corrective action and for which the dealer did not take effective corrective action. (2) Tables IA and IB show the base administrative penalties and the percentage of base amounts based on severity level of the violation. Figure 1: 25 TAC sec.241.3(p)(2) Figure 2: 25 TAC sec.241.3(p)(2) (3) Adjustments to the values in Tables IA and IB in paragraph (2) of this subsection may be made for the presence or absence of the following factors: (A) prompt identification and reporting; (B) corrective action to prevent recurrence; (C) compliance history; (D) prior notice of similar event; and (E) multiple occurrences. (4) The penalty may be in an amount not to exceed $25,000 a day for each violation for a person who violates the Health and Safety Code, Chapter 436, or a rule in this chapter (relating to Texas Crab Meat) or order of the department. Each day a violation continues may be considered a separate violation for purposes of penalty assessment. (q) The department may offer a license holder the opportunity to attend a settlement conference to discuss with the department, or a division thereof, methods and schedules for correcting the violation(s) or to show compliance with applicable provisions of the Health and Safety Code, Chapter 436, the rules in this chapter (relating to Texas Crab Meat), license conditions, and any orders of the department issued thereunder, or discuss both such topics. The Office of General Counsel may conduct settlement negotiations. (r) Notices of any settlement conference shall be sent by personal service or certified mail, return receipt requested. A settlement conference is not a prerequisite for the action to be taken under subsections (n), (o), or (p) of this section. (s) By acceptance of a license, the holder agrees to save, hold harmless, and indemnify the State of Texas, the department, and its employees against any and all liability, claims or losses for property damage or personal injury which result in whole or in part from the license holder's activities. The State of Texas shall not be held liable for financial losses incurred by the plant supervisors or plant owners due to failure of crab meat activity, condemnation of crab meat, loss of crab meat, or other reasons. sec.241.4.General HACCP Requirements. (a) Every dealer shall conduct a hazard analysis to determine the food safety hazards that are reasonably likely to occur for each kind of crab meat product processed by that dealer and to identify the preventive measures that the dealer can apply to control those hazards. Such food safety hazards can be introduced both within and outside the processing plant environment, including food safety hazards that can occur before, during, and after harvest. A food safety hazard that is reasonably likely to occur is one for which a prudent dealer would establish controls because experience, illness data, scientific reports, or other information provide a basis to conclude that there is a reasonable possibility that it will occur in the particular type of crab meat product being processed in the absence of those controls. (b) Every dealer shall have, implement, and comply with a written HACCP plan which is acceptable to the SSD. A copy of the plan shall be provided to SSD upon request. A HACCP plan shall be specific to: (1) each location where crab meat products are processed by that dealer; and (2) each kind of crab meat product processed by the dealer. The plan may group kinds of crab meat products together, or group kinds of production methods together, if the food safety hazard, critical control points, critical limits, and procedures required to be identified and performed in this section are identical for all crab meat products so grouped or for all production methods so grouped. (c) The HACCP plan shall, at a minimum: (1) list the food safety hazards that are reasonably likely to occur, as identified in accordance with subsection (a) of this section and that must be controlled for each crab meat product. Consideration should be given to whether any food safety hazards are reasonably likely to occur as a result of the following: (A) natural toxins; (B) microbiological contamination; (C) chemical contamination; (D) pesticides; (E) drug residues; (F) unapproved use of direct or indirect food or color additives; and (G) physical hazards; (2) list the critical control points for each of the identified food safety hazards, including as appropriate: (A) critical control points designed to control food safety hazards introduced outside the processing plant environment, including food safety hazards that occur before, during, and after harvest; and (B) critical control points designed to control food safety hazards that could be introduced in the processing plant environment; (3) list the critical limits that must be met at each of the critical control points; (4) list the procedures, and frequency thereof, that will be used to monitor each of the critical control points to ensure compliance with the critical limits; (5) include any corrective action plans that have been developed in accordance with this section to be followed in response to deviations from critical limits at critical control points; (6) list the verification procedures, and frequency thereof, that the dealer will use in accordance with this section; and (7) provide for a record keeping system that documents the monitoring of critical control points. The records shall contain the actual values and observations obtained during monitoring. (d) The HACCP plan shall be signed and dated by the most responsible individual on site at the processing facility or by a higher level official of the dealer: (1) upon initial acceptance; (2) upon any modification; and (3) upon verification of the plan in accordance with subsection (g)(1)(A) of this section. (e) Sanitation controls may be included in the HACCP plan. However, to the extent that they are monitored in accordance with sec.241.5 of this title (relating to General Sanitation Requirements) they need not be included in the HACCP plan, and vice versa. (f) Corrective Actions. (1) Whenever a deviation from a critical limit occurs, a dealer shall take corrective action either by: (A) following a corrective action plan that is appropriate for the particular deviation; or (B) following the procedures in subsection (f) of this section. (2) Dealers may develop written corrective action plans, which become part of their HACCP plans in accordance with subsection (c)(5) of this section, by which they predetermine the corrective actions that they will take whenever there is a deviation from a critical limit. A corrective action plan that is appropriate for a particular deviation is one that describes the steps to be taken and assigns responsibility for taking those steps, to ensure that: (A) no product enters commerce that is either injurious to health or is otherwise adulterated as a result of the deviation; and (B) the cause of the deviation is corrected. (3) When a deviation from a critical limit occurs and the dealer does not have a corrective action plan that is appropriate for that deviation, the dealer shall: (A) segregate and hold the affected product, at least until the requirements of subsection (f)(3)(B) and (C) of this section are met; (B) perform or obtain a review to determine the acceptability of the affected product for distribution. The review shall be performed by an individual or individuals who have adequate training or experience to perform such a review. Adequate training may or may not include training in accordance with this section; (C) take corrective action, when necessary, with respect to the affected product to ensure that no product enters commerce that is either injurious to health or is otherwise adulterated as a result of the deviation; (D) take corrective action, when necessary, to correct the cause of the deviation; and (E) perform or obtain timely reassessment by an individual or individuals who have been trained in accordance with this section to determine whether the HACCP plan needs to be modified to reduce the risk of recurrence of the deviation, and modify the HACCP plan as necessary. (4) All corrective actions taken in accordance with this section shall be fully documented in records that are subject to verification in accordance with subsection (g) of this section and the record keeping requirements of subsection (h) of this section. (g) Verification. (1) Every dealer shall verify that the HACCP plan is adequate to control food safety hazards that are reasonably likely to occur, and that the plan is being effectively implemented. Verification shall include, at a minimum: (A) a reassessment of the adequacy of the HACCP plan whenever any changes occur that could affect the hazard analysis or alter the HACCP plan in any way or at least annually. The reassessment shall be performed by an individual or individuals who have been trained in accordance with subsection (i) of this section. The HACCP plan shall be modified immediately whenever a reassessment reveals that the plan is no longer adequate to fully meet the requirements of subsection (c) of this section. These changes may include: (i) raw materials or source of raw materials; (ii) product formulation; (iii) processing methods or systems; (iv) finished product distribution systems; or (v) the intended use or consumers of the finished product; (B) ongoing verification activities including: (i) a review of any consumer complaints that have been received by the dealer to determine whether they relate to the performance of critical control points or reveal the existence of unidentified critical control points; (ii) the calibration of process-monitoring instruments; and (iii) at the option of the dealer, the performing of periodic end-product or in- process testing; and (C) a review, including signing and dating, by an individual who has been trained in accordance with subsection (i) of this section, of the records that document: (i) the monitoring of critical control points. The purpose of this review shall be, at a minimum, to ensure that the records are complete and to verify that they document values that are within the critical limits. This review shall occur within one week of the day that the records are made; (ii) the taking of corrective actions. The purpose of this review shall be, at a minimum, to ensure that the records are complete and to verify that appropriate corrective actions were taken in accordance with subsection (f) of this section. This review shall occur within one week of the day that the records are made; and (iii) the calibrating of any process monitoring instruments used at critical control points and the performing of any periodic end-product or in-process testing that is part of the dealer's verification activities. The purpose of these reviews shall be, at a minimum, to ensure that the records are complete, and that these activities occurred in accordance with the dealer's written procedures. These reviews shall occur within a reasonable time period after the records are made. (2) Dealers shall immediately follow the procedures in subsection (f) of this section, whenever any verification procedure, including the review of a consumer complaint, reveals the need to take a corrective action. (3) The calibration of process-monitoring instruments, and the performing of any periodic end-product and in-process testing, in accordance with subsection (g)(1)(B)(ii) and (iii) of this section shall be documented in records that are subject to the record keeping requirements of subsection (h) of this section. (h) Records. (1) All records required shall include: (A) the name and location of the dealer; (B) the date and time of the activity that the record reflects; (C) the signature or initials of the person performing the operation; and (D) where appropriate, the identity of the product and the production code, if any. Processing and other information shall be entered on records at the time that it is observed. (2) All records required shall be retained at the processing facility for at least one year after the date they were prepared in the case of refrigerated products and for at least two years after the date they were prepared in the case of frozen products. (3) Records that relate to the general adequacy of equipment or processes being used by a dealer, including the results of scientific studies and evaluations, shall be retained at the processing facility for at least two years after their applicability to the product being produced at the facility. (4) If the processing facility is closed for a prolonged period between seasonal operations, or if record storage capacity is limited on a processing vessel or at a remote processing site, the records may be transferred to some other reasonably accessible location at the end of the seasonal operations, but shall be immediately returned for official review upon request. (5) All records required by subsection (h) of this section and HACCP plans required by subsection (b) and (c) of this section shall be available for official review and copying at reasonable times. (6) The maintenance of records on computers is acceptable, provided that appropriate controls are implemented to ensure the integrity of the electronic data and electronic signatures. (i) Training. (1) At a minimum, the following functions shall be performed by an individual who has successfully completed training in the application of HACCP principles to crab meat processing at least equivalent to that received under standardized curriculum recognized as adequate by the FDA or who is otherwise qualified through job experience to perform these functions: (A) developing a HACCP plan, which could include adapting a model or generic- type HACCP plan that is appropriate for a specific dealer, in order to meet the requirements of subsection (c) of this section; (B) reassessing and modifying the HACCP plan in accordance with the corrective action procedures specified in subsection (f)(3)(E) of this section, and the HACCP plan in accordance with the verification activities specified in subsection (g)(1)(B) of this section; and (C) performing the record review required by subsection (g)(1)(C) of this section. (2) Job experience will qualify an individual to perform these functions if it has provided knowledge at least equivalent to that provided through the standardized curriculum as determined by the SSD. (3) The trained individual need not be an employee of the dealer. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 9, 1998. TRD-9801866 Susan K. Steeg General Counsel Texas Department of Health Effective date: March 1, 1998 Proposal publication date: December 12, 1997 For further information, please call: (512) 458-7236 TITLE 28. INSURANCE PART I. Texas Department of Insurance CHAPTER 7. Corporate and Financial Regulation SUBCHAPTER A. Examination and Financial Analysis 28 TAC sec.7.67 The commissioner of insurance adopts new sec.7.67, concerning annual and quarterly statement blanks, other reporting forms, instructions and filing requirements for insurers and other entities regulated by the Texas Department of Insurance when reporting their financial condition and business operations and activities during 1997 and 1998, with changes to the proposed text published in the December 26, 1997, issue of the Texas Register (21 TexReg 12664). A public hearing was held on January 8, 1998. The annual and quarterly statement blanks, other reporting forms, and diskettes adopted by reference by the section are required by statute for reporting, in 1998, the financial condition and business operations and activities conducted by insurers and other entities regulated by the department during the 1997 and 1998 calendar years. The information provided is necessary for the department to monitor the solvency, business activities and statutory compliance of the insurers and other entities regulated by the department. Most of the forms adopted by reference by the section have been promulgated by the National Association of Insurance Commissioners and are used by other state insurance regulators. The use of these forms promotes uniformity and efficiency in the regulation of insurance companies and other entities regulated by the department. In addition to these standard forms, there are other forms adopted by reference by the section that are used only by the department. These forms are reviewed each year to assure that the information required to complete the form is necessary for the department to perform it's duties. The new section replaces repealed sec.7.67, concerning the adoption of the 1989 annual statement filings which was repealed in the October 15, 1996, issue of the Texas Register (21 TexReg 10212). Section 7.67(d)(3)(F) was changed to correct a typographical error. The proposed paragraph stated that diskettes containing combined annual statement data were to be filed on or before May 1, 1997. The adopted paragraph provides that the diskettes be filed on or before May 1, 1998. Subsections (e) and (f) were changed to correctly reflect the filing requirements for fraternal benefit societies and title insurers. The proposed section provided that these quarterly statements must be filed only with the department. The adopted section reflects that quarterly statements must be filed with both the department and the NAIC. As a result of this change, the affected parts of the subsections were renumbered. In response to a comment, sec.7.67(c)(2)(H) was changed by deleting "for the 1997 annual statement." The purpose of the deletion was to clarify that the subparagraph only applied to the 1997 annual statement and was not intended as a permanent requirement. In response to a comment, sec.7.67(c)(4)(A) was changed to provide that the Texas Health Insurance Risk Pool may establish Asset Valuation Reserves or Interest Rate Maintenance Reserves or value bonds and preferred stocks in compliance with the provisions of the NAIC Purposes and Procedures of the Securities Valuation Offices Manual concerning companies not maintaining an Asset Valuation Reserve or Interest Maintenance Reserve. Additional language was added to sec.7.67(c)(4)(B) in response to a comment requesting clarification on actuarial opinion filing requirements for certain stipulated premium insurance companies. Section 7.67(c)(4)(B) and sec.7.67(e)(4)(B) were changed in response to comments so that it reflects the appropriate citation to the Insurance Code instead of the reference to the NAIC model standard valuation law. The new section defines terms relevant to the statement blanks and reporting forms; provides the dates by which certain reports are to be filed; and adopts by reference the annual and quarterly statement blanks, other reporting forms, and instructions for reporting the financial condition and business operations and activities; and requires insurance companies and certain other regulated entities to file such annual and quarterly statements and other reporting forms with the department and/or the National Association of Insurance Commissioners as directed. The required documents will provide financial information to the public and regulatory agencies, and will be used by the department to monitor the financial condition of insurers and other regulated entities licensed in Texas to assure financial solvency and compliance with applicable laws and accounting requirements. The annual and quarterly statement blanks, other reporting forms, and manuals which are adopted by this section have been filed with the Office of the Secretary of State, Texas Register Division. Copies are available for inspection in the office of the Financial Monitoring Activity of the Texas Department of Insurance, William P. Hobby State Office Building, 333 Guadalupe, Building 3, Third Floor, Austin, Texas. A commenter stated that sec.7.67(c)(2)(H) appeared to require the Texas Health Insurance Risk Pool to file a complete annual statement in the years following 1997. In response to the comment, the words "for the 1997 annual statement" were deleted to make it clear that the section only applies to the 1997 annual statement. Another commenter questioned whether sec.7.67(c)(4)(A) overruled the exemption in sec.7.16(c) of this title (relating to the National Association of Insurance Commissioners Purposes and Procedures of the Securities Valuation Office Manual) with regard to the establishment of an Asset Valuation Reserve or an Interest Maintenance Reserve. The exemption in sec.7.16 is not affected by the adoption of sec.7.67(c). Section 7.67(c)(4)(C) provides that in the event of conflict between the adopted section and other rule of the department that it is the express intent of the department that sec.7.67(c) not repeal or otherwise modify any department rule. Another commenter stated that the Texas Health Insurance Risk Pool should not have to establish an Asset Valuation Reserve or an Interest Rate Maintenance Reserve. The department agrees with the comment and changed sec.7.67(c)(4)(A) to exclude the Texas Health Insurance Risk Pool from the requirement to establish an Asset Valuation Reserve and an Interest Rate Maintenance Reserve, but would require it to comply with the NAIC Purposes and Procedures of the Securities Valuation Offices Manual concerning companies not maintaining an Asset Valuation Reserve or Interest Maintenance Reserve. Another commenter stated that sec.7.67(c)(4)(B) could be construed to require stipulated premium insurance companies to file a statement of actuarial opinion based on asset adequacy analysis. In response to the comment, sec.7.67(c)(4)(B) was changed by adding language that makes it clear that stipulated premiums insurance companies that meet certain requirements are not required to file a statement of actuarial opinion based on asset adequacy analysis. Comments on the section were received from the Texas Health Insurance Risk Pool and the Texas Association of Insurance Officials. The new section is adopted under the Insurance Code, Articles 1.11, 1.10, 3.07, 3.20-1, 3.27-2, 6.11, 6.12, 8.07, 8.08, 8.21, 8.24, 9.22, 9.47, 10.30, 11.06, 11.19, 14.15, 14.39, 15.15, 15.16, 16.18, 16.24, 17.22, 17.25, 18.12, 19.08, 20.02, 20A.10, 20A.22, 21.39, 21.43, 21.54, 22.06, 23.02, 23.26, 21.52F and 1.03A. Article 1.11 authorizes the commissioner to make changes in the forms of the annual statements required of insurance companies of any kind, as shall seem best adapted to elicit a true exhibit of their condition and methods of transacting business, and requires certain insurers to make filings with the National Association of Insurance Commissioners. Article 1.10(9), requires the department to furnish the statement blanks and other reporting forms necessary for companies to comply with the filing requirements. Articles 3.07, 3.20-1, 3.27-2, 6.11, 6.12, 8.07, 8.08, 8.21, 8.24, 9.22, 9.47, 10.30, 11.06, 11.19, 14.15, 14.39, 15.15, 15.16, 16.18, 16.24, 17.22, 17.25, 18.12, 19.08, 20.02, 20A.10, 20A.22, 21.54, 22.06, 23.02, and 23.26, require the filing of financial reports and other information by insurers and other regulated entities, and specify particular rule-making authority of the commissioner relating to those insurers and other regulated entities. Article 21.39 requires insurers to establish adequate reserves and provides for the adoption of each current formula for establishing reserves applicable to each line of insurance. Article 21.43 provides the conditions under which foreign insurers are permitted to do business in this state and requires foreign insurers to comply with the provisions of the Insurance Code. Article 21.52F authorizes the commissioner to adopt rules to implement the regulation of nonprofit health corporations holding a certificate of authority under the articles. Article 1.03A provides that the commissioner may adopt rules for the conduct and execution of the duties and functions of the department as authorized by statute for general and uniform application. sec.7.67. Requirements for Filing the 1997 Annual and 1998 Quarterly Statements, Other Reporting Forms, and Diskettes or alternative electronic method of filing. (a) Scope. This section provides insurers and other regulated entities with the filing requirements for the 1997 annual statement, 1998 quarterly statements, other reporting forms, and diskettes or alternative electronic method of filing necessary to report information concerning the financial condition and business operations and activities of insurers. This section applies to all insurers and other regulated entities authorized to do the business of insurance in this state and includes, but is not limited to, life insurers; accident insurers; life and accident insurers; life and health insurers; accident and health insurers; life, accident and health insurers; mutual life insurers; stipulated premium insurers; group hospital service corporations; fire insurers; fire and marine insurers; general casualty insurers; fire and casualty insurers; mutual insurers other than life; county mutual insurers; Lloyd's plans; reciprocal and inter-insurance exchanges; domestic risk retention groups; domestic joint underwriting associations; title insurers; fraternal benefit societies; local mutual aid associations; statewide mutual assessment companies; mutual burial associations; exempt associations; farm mutual insurers; health maintenance organizations; nonprofit health corporations; nonprofit legal services corporations; the Texas Health Insurance Risk Pool; the Texas Workers' Compensation Insurance Fund , and the Texas Windstorm Insurance Association. The commissioner of insurance adopts by reference the 1997 annual and 1998 quarterly statement blanks, instruction manuals, and other reporting forms specified in this section. The annual and quarterly statement blanks and other reporting forms are available from the Texas Department of Insurance, Financial Monitoring Activity, Mail Code 303-1A, P.O. Box 149099, Austin, Texas 78714-9099. Insurers and other regulated entities shall properly report to the Texas Department of Insurance and the National Association of Insurance Commissioners (NAIC) by completing the appropriate annual and quarterly statement blanks, prepared with laser quality print (hand written copies must be prepared legibly using black ink), other reporting forms, and diskettes or alternative electronic method of filing following the applicable instructions as outlined in subsections (c) - (l) of this section. (b) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise. (1) Association edition - Blanks and forms promulgated by the National Association of Insurance Commissioners. (2) Commissioner - The commissioner of insurance appointed under the Texas Insurance Code, Article 1.09. (3) Department - The Texas Department of Insurance. (4) Insurer - A person or business entity legally organized in and authorized by its domiciliary jurisdiction to do the business of insurance. (5) NAIC - The National Association of Insurance Commissioners. (6) Texas edition - Blanks and forms promulgated by the commissioner of insurance. (c) Filing requirements for life, accident and health insurers. Each life, life and accident, life and health, accident and health, mutual life, or life, accident and health insurance company, stipulated premium insurance company, group hospital services corporation and the Texas Health Insurance Risk Pool (Article 3.77) shall complete and file the following blanks, forms, and diskettes or alternative electronic method of filing for the 1997 calendar year and the first three quarters of the 1998 calendar year. The forms, reports and diskettes or alternative electronic method of filing identified in paragraphs (1)(A)-(F); (2)(A),(B),(H); and (3)(A)-(G) of this subsection shall be completed in accordance with the current NAIC Annual Statement Instructions, Life, Accident and Health, except as provided by paragraph (4) of this subsection. The diskettes or alternative electronic method of filing identified in paragraph (3)(H) and (I) shall be completed in accordance with the current NAIC Annual Statement Diskette Filing Specification-Life, Accident & Health, except as provided by paragraph (4) of this subsection. (1) Reports to be filed both with the department and the NAIC include the following: (A) Annual Statement (association edition, with a blue colored cover made of minimum 65lb. paper), the 9 inch by 14 inch size, to be filed on or before March 1, 1998 (stipulated premium insurance companies, April 1, 1998); (B) Annual Statement of the Separate Accounts (association edition, with a green colored cover made of minimum 65lb. paper) (required of companies maintaining separate accounts), the 9 inch by 14 inch size, to be filed on or before March 1, 1998 (stipulated premium insurance companies, April 1, 1998); (C) Trusteed Surplus Statement (association edition, Life, Accident and Health Supplement) (required of the U. S. branch of an alien insurer), 9 inch by 14 inch size to be filed on or before March 1, May 15, August 15, and November 15, 1998; (D) Management's Discussion and Analysis (a narrative document setting forth information which enables regulators to enhance their understanding of the insurer's financial position, results of operations, changes in capital and surplus accounts and cash flow), to be filed on or before April 1, 1998 (stipulated premium insurance companies, May 1, 1998); (E) Life and Accident and Health Quarterly Statement (association edition), the 9 inch by 14 inch size, to be filed on or before May 15, August 15, and November 15, 1998. However, a Texas stipulated premium insurance company, unless specifically requested to do so by the department, is not required to file quarterly statements with the department or the NAIC if it meets all three of the following conditions: (i) it is authorized to write only life insurance on its certificate of authority; (ii) it collected premiums in the prior calendar year of less than $1 million; and (iii) it had a profit from operations in the prior two calendar years; (F) Actuarial Opinion (the statement of a qualified actuary, setting forth his or her opinion relating to policy reserves and other actuarial items; required of all companies), to be attached to the annual statement required by paragraph (1)(A) of this subsection; (2) Reports to be filed only with the department: (A) Schedule SIS, Stockholder Information Supplement (association edition) (required of domestic stock companies which have 100 or more stockholders), the 9 inch by 14 inch size, to be filed on or before March 1, 1998; (B) Supplemental Compensation Exhibit (association edition) 9 inch by 14 inch size, (required of Texas domestic companies only), to be filed on or before March 1, 1998 (stipulated premium companies, April 1, 1998); (C) Annual Statement (Texas edition, with a green colored cover made of minimum 65lb. paper) (required of companies writing prepaid legal business in 1997), 8 1/2 inch by 14 inch size, to be filed on or before March 1, 1998; (D) Affidavit in Lieu of Annual Statement (required of companies authorized to write prepaid legal business that did not write such business in 1997), to be filed on or before March 1, 1998; (E) Texas Overhead Assessment Form (required of Texas domestic companies only), to be filed on or before March 1, 1998 (stipulated premium insurance companies, April 1, 1998); (F) Analysis of Surplus, for life, accident and health insurers, to be filed on or before March 1, 1998 (stipulated premium insurance companies, April 1, 1998); and (G) Supplemental Investment Income Exhibit (shows percent of net investment income by type of investment, as an attachment to page ten of the annual statement as required by paragraph (1)(A) of this subsection), to be filed on or before March 1, 1998 (stipulated premium companies, April 1, 1998). (H) The Texas Health Insurance Risk Pool shall complete and file the following: (i) NAIC Annual Statement Life, Accident and Health Annual Statement (association edition), with a blue colored cover made of minimum 65lb. paper), the 9 inch by 14 inch size, to be filed on or before March 1, 1998. However, only pages 1 - 5, 12, and the Notes to Financial Statements are required to be completed and filed on or before March 1, 1998; and (ii) Life and Accident and Health Quarterly Statement (association edition), the 9 inch by 14 inch size, to be filed on or before May 15, August 15, and November 15, 1998. (3) Reports and diskettes to be filed only with the NAIC: (A) Officers and Directors Information (association edition), to be filed on or before March 1, 1998 (stipulated premium insurance companies, April 1, 1998); (B) Credit Insurance Experience Exhibit (association edition) (required of companies writing credit business), 9 inch by 14 inch size, to be filed on or before April 1, 1998; (C) Long-Term Care Insurance Exhibit (association edition) (required of companies writing long-term care business), the 9 inch by 14 inch size, to be filed on or before March 1, 1998 (stipulated premium insurance companies, April 1, 1998), in addition to the Long-Term Care Experience Reporting Forms included in the annual statement required by paragraph (1)(A) of this subsection; (D) Interest Sensitive Life Insurance Products Report (association edition) (required of companies writing interest sensitive products), the 9 inch by 14 inch size, to be filed on or before April 1, 1998 (stipulated premium insurance companies, April 1, 1998); (E) Life, Health and Annuity Guaranty Association Model Act Assessment Base Reconciliation Exhibit (association edition), the 9 inch by 14 inch size, to be filed on or before April 1, 1998; (F) Adjustments to the Life, Health and Annuity Guaranty Association Model Act Assessment Base Reconciliation Exhibit (association edition), the 9 inch by 14 inch size, to be filed on or before April 1, 1998; (G) Schedule DS (association edition) (required only of companies that have included equity in the undistributed income of unconsolidated subsidiaries in its net gain/(loss) from operations), the 9 inch by 14 inch size, to be filed on or before March 1, 1998 (stipulated premium insurance companies, April 1, 1998); (H) diskettes containing computerized annual statement data, to be filed on or before March 1, 1998 (stipulated premium insurance companies, April 1, 1998); and (I) diskettes containing computerized quarterly statement data, to be filed on or before May 15, August 15, and November 15, 1998. (NOTE: In the event that, subsequent to the effective date of this section, an alternative method of filing this quarterly statement data becomes available, such alternative method may be used to satisfy the requirements of this diskette filing.) A Texas stipulated premium insurance company, unless specifically requested to do so by the department, is not required to file quarterly diskettes with the NAIC if it meets all three of the following conditions: (i) it is authorized to write only life insurance on its certificate of authority; (ii) it collected premiums in the prior calendar year of less than $1 million; and (iii) it had a profit from operations in the prior two calendar years. (4) The following provisions shall apply to the filings required in paragraphs (1)-(3) of this subsection. (A) Texas domestic life, accident and health companies with more than $30 million in direct premiums in 1997 must establish Asset Valuation Reserves and Interest Maintenance Reserves in their financial statements in accordance with the instructions in the 1997 NAIC Annual Statement Instructions, Life, Accident and Health Companies. Texas domestic companies with $30 million or less in direct premiums and the Texas Health Insurance Risk Pool may establish Asset Valuation Reserves and Interest Maintenance Reserves in their financial statements in accordance with the instructions in the 1997 NAIC Annual Statement Instructions, Life, Accident and Health Companies or they must value bonds and preferred stocks in compliance with the provisions of the NAIC Purposes and Procedures of the Securities Valuation Office Manual concerning companies not maintaining an Asset Valuation Reserve or Interest Maintenance Reserve. (B) Actuarial opinions required by paragraph(1)(F) of this subsection shall be in accordance with the following: (i) Unless exempted, the statement of actuarial opinion should follow the applicable provisions of sec.sec.3.1601-3.1611 of this title (relating to Actuarial Opinion and Memorandum Regulation). (ii) For those companies exempted from sec.sec.3.1601-3.1611 of this title, instructions 1-12, established by the NAIC, must be followed. (iii) Any stipulated premium company subject to sec.sec.3.1601-3.1611 of this title which does not insure or assume risk on contracts with death benefits, cash value, or accumulation values on any one life in excess of $10,000, except as permitted by Insurance Code, Article 22.13, sec.1(b), is exempt from submission of a statement of actuarial opinion is accordance with sec.3.1608 of this title (relating to Statement of Actuarial Opinion Based on an Asset Adequacy Analysis), but must submit an actuarial opinion pursuant to sec.3.1607 of this title (relating to Statement of Actuarial Opinion Not Including an Asset Adequacy Analysis). (C) In the event of a conflict between the Insurance Code, any currently existing departmental rule, form, or instruction, or any specific requirement of this subsection and the NAIC manuals listed in this subsection, then and in that event, the Insurance Code, the department's promulgated rule, form, or instruction, or the specific requirement of this subsection shall take precedence and in all respects control. It is the express intent of this subsection that it shall not repeal or otherwise modify or amend any department rule or the Insurance Code. (d) Requirements for property and casualty insurers. Each fire, fire and marine, general casualty, fire and casualty, county mutual insurance company, mutual insurance company other than life, Lloyd's plan, reciprocal or inter-insurance exchange, domestic risk retention group, life insurance company that is licensed to write workers' compensation, any farm mutual insurance company that filed a property and casualty annual statement under paragraph (1)(A) of this subsection for the 1996 calendar year or had gross written premiums in 1997 in excess of $5,000,000, any Mexican non-life insurer licensed under any article of the Insurance Code other than or in addition to Insurance Code, Article 8.24, domestic joint underwriting association, the Texas Workers' Compensation Insurance Fund created under Article 5.76-3, and the Texas Windstorm Insurance Association shall complete and file the following blanks, forms, and diskettes or alternative electronic method of filing for the 1997 calendar year and the first three quarters of the 1998 calendar year. The forms, reports, and diskettes or alternative electronic method of filing identified in paragraphs (1)(A)-(H); (2)(A),(B),(K); and (3)(A)-(D) of this subsection shall be completed in accordance with the current NAIC Annual Statement Instructions, Property and Casualty, except as provided by paragraph (4) of this subsection. The diskettes or alternative electronic method of filing identified in paragraph (3)(E) - (G) of this subsection shall be completed in accordance with the current NAIC Annual Statement Diskette Filing Specification-Property/Casualty, except as provided by paragraph (4) of this subsection. (1) Reports to be filed both with the department and the NAIC: (A) Annual Statement (association edition, with a yellow colored cover made of minimum 65lb. paper), the 9 inch by 14 inch size, to be filed on or before March 1, 1998; (B) Trusteed Surplus Statement (association edition, Property and Casualty Supplement) (required of the U. S. branch of an alien insurer), 9 inch by 14 inch size to be filed on or before March 1, May 15, August 15, and November 15, 1998; (C) Management's Discussion and Analysis (a narrative document setting forth information which enables regulators to enhance their understanding of the insurer's financial position, results of operations, changes in capital and surplus accounts and cash flow), to be filed on or before April 1, 1998; (D) Financial Guaranty Insurance Exhibit (association edition) (required of companies writing financial guaranty business), the 9 inch by 14 inch size, to be filed on or before March 1, 1998; (E) Supplement "A" to Schedule T, Exhibit of Medical Malpractice Premiums Written (association edition) (required of companies writing medical malpractice business), the 9 inch by 14 inch size, to be filed on or before March 1, 1998; (F) Property and Casualty Quarterly Statement (association edition), the 9 inch by 14 inch size, to be filed on or before May 15, August 15, and November 15, 1998; (G) Actuarial Opinion (the statement of a qualified actuary, setting forth his or her opinion relating to policy reserves and other actuarial items; required of all companies), to be attached to the annual statement required by paragraph (1)(A) of this subsection; and (H) Combined Property/Casualty Annual Statement (association edition, with a yellow colored cover made of minimum 65lb. paper), the 9 inch by 14 inch size, to be filed on or before May 1, 1998, including the Insurance Expense Exhibit. This form is required only for those affiliated insurers that wrote more than $35 million in direct premiums, as a group, in 1997 as defined in Schedule T of the Annual Statement. (2) Reports to be filed only with the department: (A) Schedule SIS, Stockholder Information Supplement (association edition) (required of domestic stock companies which have 100 or more stockholders), the 9 inch by 14 inch size, to be filed on or before March 1, 1998; (B) Supplemental Compensation Exhibit (association edition) 9 inch by 14 inch size, (required of Texas domestic companies only), to be filed on or before March 1, 1998; (C) Supplemental Investment Income Exhibit (shows percent of net investment income by type of investment, as an attachment to page six of the annual statement required by paragraph (1)(A) of this subsection), to be filed on or before March 1, 1998; (D) Annual Statement (Texas edition, with a green colored cover made of minimum 65lb. paper) (required of companies writing prepaid legal business in 1997), 8 1/2 inch by 14 inch size, to be filed on or before March 1, 1998; (E) Affidavit in Lieu of Annual Statement (required of companies authorized to write prepaid legal business that did not write such business in 1997), to be filed on or before March 1, 1998; (F) Texas Overhead Assessment Form (required of Texas domestic companies only), to be filed on or before March 1, 1998; (G) Analysis of Surplus, for property and casualty insurers (required of all licensed companies, except Texas domestic county mutual companies), to be filed on or before March 1, 1998; (H) Supplement for County Mutuals (required of Texas domestic county mutual companies, as an attachment to page seventeen of the annual statement as required by paragraph (1)(A) of this subsection), to be filed on or before March 1, 1998; (I) Texas Supplemental A for County Mutuals (required of Texas domestic county mutual companies, as an attachment to page nine of the annual statement as required by paragraph (1)(A) of this subsection), to be filed on or before March 1, 1998 ; and (J) Form ALT/P/WC, Application for Alternative Excess Statutory Over Statement Reserves for Workers' Compensation (required of deductible plan workers' compensation writers if applying for an alternative basis of calculating the excess statutory over statement reserves for workers' compensation business), to be filed on or before January 31, 1998; (K) The Texas Windstorm Insurance Association (Article sec.21.49) shall complete and file the following: (i) Annual Statement, (association edition, with a yellow colored cover made of minimum 65lb. paper), the 9 inch by 14 inch size, to be filed on or before June 1, 1998, except as provided by paragraph (4) of this subsection; (ii) Property and Casualty Quarterly Statement (association edition), the 9 inch by 14 inch size, to be filed on or before May 15, August 15, and November 15, 1998; and (iii) Management's Discussion and Analysis (a narrative document setting forth information which enables regulators to enhance their understanding of the insurer's financial position, results of operations, changes in capital and surplus accounts and cash flow), to be filed on or before April 1, 1998; (3) Reports and diskettes to be filed only with the NAIC: (A) Officers and Directors Information (association edition), to be filed on or before March 1, 1998; (B) Insurance Expense Exhibit (association edition), the 9 inch by 14 inch size, to be filed on or before April 1, 1998; (C) Credit Insurance Experience Exhibit (association edition) (required of companies writing credit accident and/or health business), 9 inch by 14 inch size, to be filed on or before April 1, 1998; (D) Long-Term Care Experience Reporting Forms (association edition) (required of companies writing long-term care business), the 9 inch by 14 inch size, to be filed on or before April 1, 1998; (E) diskettes containing computerized annual statement data, to be filed on or before March 1, 1998; (F) diskettes containing combined annual statement data, to be filed on or before May 1, 1998; and (G) diskettes containing computerized quarterly statement data, to be filed on or before May 15, August 15, and November 15, 1998. (NOTE: In the event that, subsequent to the effective date of this section, an alternative method of filing this quarterly statement data becomes available, such alternative method may be used to satisfy the requirements of this diskette filing.) (4) The following provisions shall apply to all filings required by paragraphs (1) - (3) of this subsection. (A) No loss reserve discounts, other than as respects fixed and determinable payments such as those emanating from workers' compensation tabular indemnity reserves and long-term disability claims for which specific segregated investments have been established, shall be allowed. In prior years, any company that claimed loss reserve discounts, other than as respects fixed and determinable payments such as those emanating from workers' compensation tabular indemnity reserves and long-term disability claims, as of December 31, 1991, was allowed to claim such reserve discounts at the applicable percentage. The applicable percentages for claiming such loss reserve discounts were 100% for 1992, 75% for 1993, 50% for 1994, 25% for 1995, 0% for 1996 and subsequent years. In no event was the dollar amount of discounts, other than as respects fixed and determinable payments such as those emanating from workers' compensation tabular indemnity reserves and long-term disability claims, claimed as of December 31, 1991, and subject to the applicable percentage, allowed to be increased as of December 31, 1992 and thereafter. The commissioner shall have the authority to determine the appropriateness of, and may disapprove, discounts taken as respects fixed and determinable payments such as those emanating from workers' compensation tabular indemnity reserves and long-term disability claims. (B) The commissioner shall have the authority to determine the appropriateness of, and may disapprove, anticipated salvage and subrogation. (C) Since workers' compensation legislation enacted by the 71st Texas Legislature, effective January 1, 1991, and other subsequent legislation, may have affected the pricing and loss ratios for workers' compensation business written in the State of Texas, some insurers may be exempt from establishing the entire excess of statutory reserves over statement reserves, also known as the Schedule P penalty reserve, as would otherwise be required by the NAIC Annual Statement Instructions, Property and Casualty. Specifically, Texas domestic insurers that wrote workers' compensation in Texas, but no state other than Texas, in years 1995, 1996 and 1997 and whose loss experience prior to 1994 would require the establishment of a Schedule P penalty reserve using a loss ratio greater than 65% may calculate the reserve based on a loss ratio of 65%. The exemption herein described shall only be for the 1997 annual and 1998 interim financial statements. Reserving in this manner is intended to be consistent with the regulatory desire to attain competitive rates for workers' compensation written in Texas. (D) Insurers meeting certain eligibility criteria and not claiming the exemption provided in paragraph (4)(C) of this subsection may apply for approval of an alternative basis of calculating the Excess of Statutory Over Statement Reserve, also known as the Schedule P penalty reserve, for workers' compensation business. The application for an alternative basis for calculating this reserve applies only to workers' compensation business written pursuant to deductible plans authorized by Insurance Code, Article 5.55C. (i) Eligibility is generally available to insurers that are domiciled or commercially domiciled in Texas and that demonstrate that their standard premium, prior to application of deductible credits, written pursuant to deductible plans was at least 80% of total standard premium for all workers' compensation business for each of the years for which an alternative calculation is requested. (ii) To apply for an alternative basis of calculating the penalty reserve, an eligible insurer must complete Form ALT/P/WC, Application for Alternative Excess of Statutory Over Statement Reserve for Workers' Compensation. Forms may be obtained by writing the Financial Monitoring Activity, Texas Department of Insurance, MC 303-1A, P.O. Box 149099, Austin, Texas 78714-9099, or calling (512) 322-5002. Completed applications must be filed with the department on or before January 31, 1998. (iii) The commissioner may grant an exception or alternative to requiring the full Schedule P penalty reserve for workers' compensation business upon finding such treatment is warranted based on the insurer's application. Insurers that do not obtain the prior written approval of the department for an alternative basis of calculating the Schedule P penalty reserve as provided in the subparagraph shall calculate the penalty reserve in accordance with the current NAIC Annual Statement Instruction, Property and Casualty. (E) In the event of a conflict between the Insurance Code, any currently existing departmental rule, form, or instruction, or any specific requirement of this section and the NAIC manuals listed in this subsection, then and in that event, the Insurance Code, the department's promulgated rule, form, or instruction, or the specific requirement of this section shall take precedence and in all respects control. It is the express intent of this subsection that it shall not repeal or otherwise modify or amend any department rule or the Insurance Code. (e) Requirements for fraternal benefit societies. Each fraternal benefit society shall complete and file the following blanks, forms, and diskettes for the 1997 calendar year and the first three quarters of the 1998 calendar year. The forms, reports, and diskettes identified in paragraphs (1)(A)-(F); (2)(A),(D); and (3)(A),(B) and (D) of this subsection shall be completed in accordance with the current NAIC Annual Statement Instructions, Fraternal, except as provided by paragraph (4) of this subsection. The diskettes identified in paragraph (3)(C) of this subsection shall be completed in accordance with the current NAIC Annual Statement Diskette Filing Specification-Fraternal, except as provided by paragraph (4) of this subsection. (1) Reports to be filed both with the department and the NAIC: (A) Annual Statement (association edition, with a brown colored cover made of minimum 65lb. paper), the 9 inch by 14 inch size, to be filed on or before March 1, 1998; (B) Annual Statement of the Separate Accounts (association edition, with a green colored cover made of minimum 65lb. paper) (required of companies maintaining separate accounts), the 9 inch by 14 inch size, to be filed on or before March 1, 1998; (C) Fraternal Quarterly Statement (association edition), the 9 inch by 14 inch size, to be filed on or before May 15, August 15, and November 15, 1998; (D) Trusteed Surplus Statement (association edition, Fraternal Supplement) (required of the U. S. branch of an alien insurer), 9 inch by 14 inch size to be filed on or before March 1, May 15, August 15, and November 15, 1998; (E) Management's Discussion and Analysis (a narrative document setting forth information which enables regulators to enhance their understanding of the insurer's financial position, results of operations, changes in capital and surplus accounts and cash flow), to be filed on or before April 1, 1998; and (F) Actuarial Opinion (the statement of a qualified actuary, setting forth his or her opinion relating to policy reserves and other actuarial items; to be filed by all companies), to be attached to the annual statement required by paragraph (1)(A) of this subsection. (2) Reports to be filed only with the department: (A) Supplemental Compensation Exhibit (association edition) 9 inch by 14 inch size, (required of Texas domestic companies only), to be filed on or before March 1, 1998; (B) Texas Overhead Assessment Form (required of Texas domestic companies only), to be filed on or before March 1, 1998; (C) Analysis of Surplus, for fraternal benefit societies, to be filed on or before March 1, 1998; (D) Fraternal Benefit Societies - Supplement to Valuation Report, to be filed on or before June 30, 1998; and (E) Supplemental Investment Income Exhibit (shows percent of net investment income by type of investment, as an attachment to page ten of the annual statement as required by paragraph (1)(A) of this subsection), to be filed on or before March 1, 1998. (3) Reports and diskettes to be filed only with the NAIC: (A) Officers and Directors Information (association edition), to be filed on or before March 1, 1998; (B) Long-Term Care Insurance Exhibit (association edition) (required of companies writing long-term care business), the 9 inch by 14 inch size, to be filed on or before March 1, 1998, in addition to the Long-Term Care Experience Reporting Forms included in the annual statement required in paragraph (1)(A) of this subsection; (C) diskettes containing computerized annual statement data, to be filed on or before March 1, 1998; and (D) Fraternal Interest Sensitive Life Insurance Products Report (association edition) (required of companies writing interest sensitive products), the 9 inch by 14 inch size, to be filed on or before April 1, 1998. (4) The following provisions shall apply to the filings required in paragraph (1) - (3) of this subsection. (A) Texas domestic fraternal companies with more than $30 million in direct premiums in 1997 must establish Asset Valuation Reserves and Interest Maintenance Reserves in their financial statements in accordance with the instructions in the 1997 NAIC Annual Statement Instructions Fraternal. Texas domestic fraternal companies with $30 million or less in direct premiums may establish Asset Valuation Reserves and Interest Maintenance Reserves in their financial statements in accordance with the instructions in the 1997 NAIC Annual Statement Instructions Fraternal or they must value bonds and preferred stocks in compliance with the provisions of sec.7.16 of this title (relating to NAIC Purposes and Procedures of the Securities Valuation Office Manual) concerning companies not maintaining an Asset Valuation Reserve or Interest Maintenance Reserve. (B) Since fraternals are not subject to Article 3.28 Section 2A, Texas Insurance Code, the statement of actuarial opinion for fraternals should follow instructions 1 - 12, established by the NAIC. (C) In the event of a conflict between the Insurance Code, any currently existing departmental rule, form, or instruction, or any specific requirement of this subsection and the NAIC manuals listed in this subsection, then and in that event, the Insurance Code, the department's promulgated rule, form, or instruction, or the specific requirement of this subsection shall take precedence and in all respects control. It is the express intent of this subsection that it shall not repeal or otherwise modify or amend any department rule or the Insurance Code. (f) Requirements for title insurers. Each title insurance company shall complete and file the following blanks and forms for the 1997 calendar year and the first three quarters of the 1998 calendar year. The reports and forms identified in paragraphs (1)(A)-(C); (2)(A) and (E); and (3)(A) of this subsection shall be completed in accordance with the current NAIC Annual Statement Instructions, Title, except as otherwise provided by paragraph (4) of this subsection. The diskette identified in paragraph (3)(B) of this subsection shall be completed in accordance with the current NAIC Annual Statement Diskette Filing Specification- Title, except as provided by paragraph (4) of this subsection. (1) Reports to be filed with the department and the NAIC: (A) Annual Statement (association edition, with a salmon colored cover made of minimum 65lb. paper), the 9 inch by 14 inch size, to be filed on or before March 1, 1998; and (B) Management's Discussion and Analysis (a narrative document setting forth information which enables regulators to enhance their understanding of the insurer's financial position, results of operations, changes in capital and surplus accounts and cash flow), to be filed on or before April 1, 1998. (C) Title Quarterly Statement (association edition), the 9 inch by 14 inch size, to be filed on or before May 15, August 15, and November 15, 1998. (2) Reports to be filed only with the department: (A) Supplemental Compensation Exhibit (association edition), 9 inch by 14 inch size, (required of Texas domestic companies only), to be filed on or before March 1, 1998; (B) Texas Overhead Assessment Form (required of Texas domestic companies only), to be filed on or before March 1, 1998; (C) Analysis of Surplus, for title insurers, to be filed on or before March 1, 1998; (D) Supplemental Investment Income Exhibit (shows percent of net investment income by type of investment, as an attachment to page six of the annual statement as required in paragraph (1)(A) of this subsection), to be filed on or before March 1, 1998; and (E) Schedule SIS, Stockholder Information Supplement (association edition) (required of domestic stock companies which have 100 or more stockholders), the 9 inch by 14 inch size, to be filed on or before March 1, 1998. (3) Reports to be filed only with the NAIC. (A) Officers and Directors Information (association edition), to be filed on or before March 1, 1998. (B) diskettes containing computerized annual statement data, to be filed on or before March 1, 1998. (4) In the event of a conflict between the Insurance Code, any currently existing departmental rule, form, or instruction, or any specific requirement of this subsection and the NAIC manuals listed in this subsection, then and in that event, the Insurance Code, the department's promulgated rule, form, or instruction, or the specific requirement of this subsection shall take precedence and in all respects control. It is the express intent of this subsection that it shall not repeal or otherwise modify or amend any department rule or the Insurance Code. (g) Requirements for health maintenance organizations. Each health maintenance organization and non-profit health corporation shall complete and file the following blanks and forms, and diskettes for the 1997 calendar year and the first three quarters of the 1998 calendar year. The forms, reports and diskettes identified in paragraphs (1)(A)-(C) and (2)(A),(B) of this subsection shall be completed in accordance with the NAIC Annual Statements Instructions, Health Maintenance Organizations. The forms, reports and diskettes identified in paragraphs (1)(A), (2)(A)-(C), (E)-(G), and (3) of this subsection shall be completed in accordance with Annual and Quarterly HMO Supplement Instructions (provided by the department). The diskettes identified in paragraph (3) of this subsection shall be completed in accordance with the current NAIC Annual Diskette Filing Specification - Health Maintenance Organization. (1) Reports to be filed both with the department and the NAIC: (A) Annual Statement (association edition, HMO with an orange colored cover made of minimum 65lb. paper), 8 1/2 inch by 14 inch size, to be filed on or before March 1, 1998; (B) Management's Discussion and Analysis, (a narrative document setting forth information which enable regulators to enhance their understanding of the insurer's financial position, results of operations, changes in capital and surplus accounts and cash flow), to be filed on or before April 1, 1998; (C) Actuarial Opinion (the statement of a qualified actuary, setting forth his or her opinion relating to policy reserves and other actuarial items; to be filed by all health maintenance organizations), to be attached to the annual statement required by paragraph (1)(A) of this subsection; (2) Reports to be filed only with the department: (A) Supplemental Compensation Exhibit (association edition), 9 inch by 14 inch size, (required of Texas domestic companies only), to be filed on or before March 1, 1998; (B) HMO Quarterly Statement (association edition), 8 1/2 inch by 14 inch size, to be filed on or before May 15, August 15, and November 15, 1998; (C) HMO Supplement, 8 1/2 inch by 14 inch size, to be filed on or before March 1, 1998; (D) Texas Overhead Assessment Form (required of Texas domestic companies only), to be filed on or before March 1, 1998; (E) Department formatted diskettes containing annual statement data (diskettes provided by the department for entering of health maintenance organization or non-profit health corporation financial statement data), to be completed according to the instructions provided by the department and filed with the department on or before March 1, 1998; and (F) Department formatted diskettes containing quarterly statement data (diskettes provided by the department for entering of health maintenance organization or non-profit health corporation financial statement data), to be completed according to the instructions provided by the department and filed with the department on or before May 15, August 15, and November 15, 1998. (3) Reports and diskettes to be filed only with the NAIC. The diskettes containing computerized annual statement data must be filed on or before March 1, 1998; (4) In the event of a conflict between the Insurance Code, any existing departmental rule, form, or instruction, or any specific requirement of this subsection required in paragraphs (1)-(3), and the NAIC manuals listed in this subsection, then and in that event, the Insurance Code, the department's promulgated rule, form, or instruction, or the specific requirement of this subsection shall take precedence and in all respects control. It is the express intent of this subsection that it shall not repeal or otherwise modify or amend any department rule or the Insurance Code. (h) Requirements for farm mutual insurers not subject to the provisions of subsection (d) of this section relating to requirements for property and casualty insurers. Each farm mutual insurance company shall file the following completed blanks and forms for the 1997 calendar year with the department only: (1) Annual statement (Texas edition, with a tan colored cover made of minimum 65lb. paper), 8 1/2 inch by 14 inch size, to be filed on or before March 1, 1998; (2) Texas Overhead Assessment Form, to be filed on or before March 1, 1998; (3) Actuarial Opinion (the statement of a qualified actuary, setting forth his or her opinion relating to policy reserves and other actuarial items), to be attached to the annual statement required by paragraph (1) of this subsection, unless otherwise exempted. (i) Requirements for mutual assessment companies, mutual aid and mutual burial associations, and exempt companies. Each statewide mutual assessment company, local mutual aid association, local mutual burial association, and exempt company shall file the following completed blanks and forms for the 1997 calendar year with the department only: (1) Annual Statement (Texas edition, with an orange colored cover made of minimum 65lb. paper), 8 1/2 inch by 14 inch size, to be filed on or before April 1, 1998, provided, however, exempt companies are not required to complete lines 22, 23, 24, 25, and 26 on page 3, the special instructions at the bottom of page 3, and pages 4, 5, 6, and 7. All other pages are required; (2) Texas Overhead Assessment Form, to be filed on or before April 1, 1998; (3) Release of Contributions Form, to be filed on or before April 1, 1998; (4) 3 1/2% Chamberlain Reserve Table (Reserve Valuation), to be filed on or before April 1, 1998; (5) Reserve Summary (1956 Chamberlain Table 3 1/2%), to be filed on or before April 1, 1998; (6) Inventory of Insurance in Force by Age of Issue or Reserving Year, to be filed on or before April 1, 1998; and (7) Summary of Inventory of Insurance In Force by Age and Calculation of Net Premiums, to be filed on or before April 1, 1998. (j) Requirements for non-profit legal service corporations. Each non-profit legal service corporation shall file the following completed blanks and forms for the 1997 calendar year with the department only; (1) Annual Statement (Texas edition, with a green colored cover made of minimum 65lb. paper), 8 1/2 inch by 14 inch size, to be filed on or before March 1, 1998; and (2) Texas Overhead Assessment Form, to be filed on or before March 1, 1998. (k) Requirements for Mexican casualty companies. Each Mexican casualty company doing business as authorized by a Certificate of Authority issued under Texas Insurance Code, Article 8.24, shall complete and file the following blanks and forms for the 1997 calendar year with the department only. All submissions shall be printed or typed in English and all monetary values shall be clearly designated in United States dollars. The form identified in paragraph (1) of this subsection shall be completed in accordance with the current NAIC Annual Statement Instructions, Property and Casualty, except as provided by this section. An actuarial opinion is not required. In the event of a conflict between the Insurance Code, any currently existing departmental rule, form, or instruction, or any specific requirement of this subsection and the NAIC manuals listed in this subsection, then and in that event, the Insurance Code, the department's promulgated rule, form, or instruction, or the specific requirement of this subsection shall take precedence and in all respects control. It is the express intent of this subsection that it shall not repeal or otherwise modify or amend any department rule or the Insurance Code. The blanks or forms are as follows: (1) Annual Statement (association edition, with a yellow colored cover made of minimum 65lb. paper), 9 inch by 14 inch size, provided, however, only pages 1 - 4, 15, 17, 18, 19 and 139 are required to be completed and filed on or before March 1, 1998; (2) A copy of the balance sheet and the statement of profit and loss from the Mexican financial statement (printed or typed in English), to be filed on or before March 1, 1998; (3) A copy of the official documents issued by the COMISION NACIONAL DE SEGUROS Y FIANZAS approving the current year's annual statement, to be filed on or before June 30, 1998; and (4) A copy of the current license to operate in the Republic of Mexico, to be filed on or before March 1, 1998. (l) Other financial reports. Nothing in this section prohibits the department from requiring any insurer or other regulated entity from filing other financial reports with the department. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9801938 Caroline Scott General Counsel and Chief Clerk Texas Department of Insurance Effective date: March 2, 1998 Proposal publication date: December 26, 1997 For further information, please call: (512) 463-6327 TITLE 37. PUBLIC SAFETY AND CORRECTIONS PART I. Texas Department of Public Safety CHAPTER 1.Organization and Administration Objective, Mission, and Program 37 TAC sec.1.4 The Texas Department of Public Safety adopts an amendment to sec.1.4, concerning Programs Under Traffic Law Enforcement Division, without changes to the proposed text as published in the December 19, 1997, issue of the Texas Register (22 TexReg 12433). The justification for this section will be to make the public aware of program and activity changes under the Traffic Law Enforcement Division. Subsections (a)-(e) are amended by adding and deleting language in order to better identify the activities of the various services under the Traffic Law Enforcement Division. Subsection (h) is amended to more accurately describe the operating sections within the Motor Carrier Bureau. No comments were received regarding adoption of the amendment. The amendment is adopted pursuant to Texas Government Code, sec.411.004(3), and sec.411.006(4) which provides the Public Safety Commission with the authority to adopt rules necessary for carrying out the department's work. The director, subject to the approval of the Commission, shall have the authority to adopt rules necessary for the control of the department. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9801949 Dudley M. Thomas Director Texas Department of Public Safety Effective date: March 2, 1998 Proposal publication date: December 19, 1997 For further information, please call: (512) 424-2890 CHAPTER 16.Commercial Driver's License Licensing Requirements, Qualification, Restrictions, and Endorsements 37 TAC sec.16.3, sec.16.12 The Texas Department of Public Safety adopts amendments to sec.16.3 and sec.16.12 concerning Licensing Requirements, Qualifications, Restrictions, and Endorsements. sec.16.12 is adopted with changes to the proposed text as published in the December 5, 1997, issue of the Texas Register (22 TexReg 12024). sec.16.3 is adopted without changes and will not be republished. The justification for the amendments will be to include an additional exempt group of drivers under the commercial driver's license law. Amendment to sec.16.3 adds new paragraph (6) which adds persons operating a vehicle used exclusively to transport seed cotton modules or cotton burrs to the exempt group of drivers under the commercial driver's license law. Section 16.3 is further amended to correct reference to statutes due to the recodification of Texas Civil Statutes to Texas Transportation Code. In sec.16.12 subsection (f) is deleted due to no longer being a necessary endorsement and subsection (c) and (d) definitions are amended to clearly define who is required to have certain endorsements to operate certain types of commercial vehicles. The single change relates to a typographical error in sec.16.12(c). The number "199" is changed to "119" gallons for liquids. No comments were received regarding adoption of the amendments. The amendments are adopted pursuant to Texas Transportation Code, sec.522.005 which provides the Texas Department of Public Safety with the authority to adopt rules necessary to carry out the Texas Driver's License Act, Texas Commercial Driver's License Act, and the Federal Commercial Motor Vehicle Safety Act of 1986. sec.16.12.Endorsements. (a) T - Double/Triple Trailer (commercial driver's license and noncommercial driver's license). This endorsement authorizes the holder to tow more than one trailer. (b) P - Passenger Vehicles (CDL only). This endorsement authorizes the holder to operate a vehicle which is designed to transport 16 or more passengers, including the driver. (c) N - Tank Vehicle (CDL only). This endorsement authorizes the holder to operate a vehicle or combination of vehicles which are designed to transport any liquid or gaseous materials within a tank that is either permanently or temporarily attached to the vehicle or chassis. Such vehicles include, but are not limited to, cargo tanks and portable tanks, as defined in 49 CFR, Part 171. A CDL tank endorsement is required if the cargo tank has a bulk packaging over 119 gallons for liquids, or a water capacity greater than 1,000 pounds as a receptacle for a gas if, they are permanently attached to or form a part of a motor vehicle, or is not permanently attached to a motor vehicle but which, by reason of its size, construction or attachment to a motor vehicle is loaded or unloaded without being removed from the motor vehicle and is not built to the specifications for cylinders, or portable tanks. A portable tank is defined as a bulk packaging (except a cylinder having a water capacity of 1,000 pounds or less) designed primarily to be loaded onto, or on or temporarily attached to a transport vehicle and equipped with skids, mounting, or accessories to facilitate handling of the tank by mechanical means. A portable tank that meets the bulk packaging definition described in this subsection requires a CDL with a tank endorsement. (d) H - Hazardous Materials (CDL only). This endorsement authorizes the holder to operate a vehicle or combination of vehicles which are required to be placarded under the Hazardous Materials Transportation Act (49 USC sec.1801 et seq.). (e) X - Combination of N and H (CDL only). This endorsement is used to combine the endorsements N and H. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9801950 Dudley M. Thomas Director Texas Department of Public Safety Effective date: March 2, 1998 Proposal publication date: December 5, 1997 For further information, please call: (512) 424-2890 CHAPTER 23.Vehicle Inspection Commercial Motor Vehicle Compulsory Inspection Program 37 TAC sec.23.101, sec.23.102 The Texas Department of Public Safety adopts an amendment to sec.23.101, concerning Commercial Motor Vehicle Compulsory Inspection Program and new sec.23.102, concerning the Acceptance Of Out-Of-State Commercial Vehicle Inspection Certificates, without changes to the proposed text as published in the November 7, 1997, issue of the type-name="italic">Texas Register (22 TexReg 10927). The justification for the amendment and new section will be greater compliance by motor carriers with the state inspection requirements. The amendment to sec.23.101 subsection (f) is necessary in order to implement the changes to the definition of commercial motor vehicles resulting from the passage of Senate Bill 1486 passed during the 75th Texas Legislative Session. New sec.23.102 is necessary in order to establish procedures that would provide an owner or operator of a Texas-registered commercial vehicle an opportunity to comply with the provisions of the commercial vehicle inspection requirements in Texas. No comments were received regarding adoption of the amendment and new section. The amendment and new section are adopted pursuant to Texas Transportation Code, sec.548 and Texas Government Code, sec.411.006(4), which provide the Public Safety Commission of the Texas Department of Public Safety with the authority to establish rules for the conduct of the work of the Texas Department of Public Safety, and which authorizes the Commission to adopt rules establishing an inspection program for commercial motor vehicles that meet the requirements of the Federal Motor Carrier Safety Regulations and which requires a commercial motor vehicle registered in this state to pass an annual inspection. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 10, 1998. TRD-9801951 Dudley M. Thomas Director Texas Department of Public Safety Effective date: March 2, 1998 Proposal publication date: November 7, 1997 For further information, please call: (512) 424-2890 TITLE 40. SOCIAL SERVICES AND ASSISTANCE PART II. Texas Rehabilitation Commission CHAPTER 110.Legal Services 40 TAC sec.110.2 The Texas Rehabilitation Commission adopts new sec.110.2, concerning subrogation, without changes to the proposed text as published in the January 9, 1998, issue of the Texas Register (23 TexReg 338). The section is being adopted to ensure the commission recovers funds expended that are owed under the commission's right of subrogation. No comments were received regarding adoption of the new section. For further information, please contact Roger Darley, Deputy General Counsel, Texas Rehabilitation Commission, 4900 North Lamar Boulevard, Suite 7300, Austin, Texas 78751. The new section is adopted under the Texas Human Resources Code, Title 7, Chapter 111, sec.111.018 and sec.111.023, which provides the Texas Rehabilitation Commission with the authority to promulgate rules consistent with Title 7, Texas Human Resources Code. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 17, 1998. TRD-9802355 Charles Schiesser Chief of Staff Texas Rehabilitation Commission Effective date: February 9, 1998 Proposal publication date: January 9, 1998 For further information, please call: (512) 424-4050 PART IV. Texas Commission for the Blind CHAPTER 161.Scope and Services and General Clientele 40 TAC sec.161.5 The Texas Commission for the Blind adopts the repeal of sec.161.5 of Chapter 161 pertaining to confidentiality of records. The repeal has been adopted without changes to the proposed text as published in the January 9, 1998, issue of the Texas Register (22 TexReg 339). The repeal is adopted in order to simultaneously adopt a new section on confidentiality in Chapter 163 of this title (pertaining to the Vocational Rehabilitation Program), which is the more appropriate placement for the rules. The repeal allows the adoption of rules that comply with recent changes to federal regulations governing the State Vocational Rehabilitation Services Program. No comments were received regarding adopting the repeal. The repeal is adopted under Human Resources Code, Title 5, Chapter 91, sec.91.011(g), which authorizes the commission to adopt rules prescribing the policies and procedures followed by the commission in the administration of its programs. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 11, 1998. TRD-9801979 Terrell I. Murphy Interim Executive Director Texas Commission for the Blind Effective date: March 3, 1998 Proposal publication date: January 9, 1998 For further information, please call: (512) 459-2611 CHAPTER 163.Vocational Rehabilitation Program SUBCHAPTER H.Confidentiality of Records 40 TAC sec.sec.163.85-163.87 The Texas Commission for the Blind adopts new sec.sec.163.85, 163.86, and 163.87 to its rules for administering the agency's vocational rehabilitation program. The sections have been adopted without changes to the proposed text as published in the January 9, 1998, issue of the Texas Register (22 Tex Reg 339-340). The sections are adopted to comply with recent changes to federal regulations governing the State Vocational Rehabilitation Services Program to implement changes to the Rehabilitation Act of 1973. The sections are contained in a new Subchapter H, Confidentiality of Records, which sets forth the conditions under which consumer and applicant personal information maintained by the Commission may be provided outside the agency and to applicants and consumers. No comments were received regarding the adoption of the new sections. The new sections are adopted under Human Resources Code, Title 5, Chapter 91, sec.91.011(g), which authorizes the commission to adopt rules prescribing the policies and procedures followed by the commission in the administration of its programs. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Filed with the Office of the Secretary of State on February 11, 1998. TRD-9801980 Terrell I. Murphy Interim Executive Director Texas Commission for the Blind Effective date: March 3, 1998 Proposal publication date: January 9, 1998 For further information, please call: (512) 459-2611