TITLE community-development

Part I. Texas Department of Housing and Community Affairs

Chapter 80. Manufactured Housing

Subchapter D. Standards and Requirements

10 TAC §§80.53-80.55

The Texas Department of Housing and Community Affairs (Department) proposes amending §§80.53 - 80.55, concerning the home manufacturer's design requirements, moisture and ground vapor control measures, generic standards for installing manufactured homes, and alternate generic cross drive rock anchor installation instructions.

Section 80.53(e) is amended to communicate that installers may install cross drive rock anchors in accordance with the generic installation standards.

Section 80.54(a)(2) is amended so that the generic standards may be modified by an appendix filed in accordance with §80.51(a)(2). If the design of a home requires a change in the generic standards to protect the structural integrity of the home, the home manufacturer may file an appendix to the state's generic standards as part of the home manufacturer's installation instructions.

Section 80.54(b) is amended to delete the requirement to install a ground vapor barrier material under every manufactured home installed. Retailers or installers are only required to install the ground vapor barrier material if the home is installed per the department's generic standards or if the manufacturer's installation instructions require the material to be installed.

Section 80.54(b)(3) is amended to explain the standards for ground clearance requirement if a home is installed per the generic standards. If a home is installed in accordance with the home installation instructions, the installer must follow the ground clearance requirement of the home installation instructions.

Section 80.54(b)(5) is amended to explain the standards for moisture and ground vapor controls and the generic requirement for access openings since this is a measure for monitoring moisture and ground vapor controls. If the space underneath the home is to be enclosed, the retailer and/or installer must notify the purchaser that moisture and ground vapor control measures are required. If a home is installed in accordance with the home installation instructions, the installer must follow the moisture and ground vapor control requirements of the home installation instructions. For the purpose of safety and durability, installers are required to pass the clothes dryer exhaust duct, air conditioning condensation drain, or combustion air inlet through the skirting to the outside, if those items are present.

Section 80.54(c), the Site Preparation Notice, is amended to explain that if skirting is provided, the consumer must be notified that moisture and ground vapor control measures are required. The phrase "ground vapor retarder" was updated to "ground vapor control measures." These changes are required since home installation instructions may require moisture and ground vapor control measures other than a vapor retarder on the ground.

Figure: 10 TAC §80.55(d)(1) and Figure: 10 TAC §80.55(d)(2) are amended to add references to refer to §80.55(d)(4) concerning alternative generic cross drive rock anchor installation instructions.

New §80.55(d)(4) is added because there are no cross drive rock or soil auger anchors individually designed for mixed rock and soil conditions or hard caliche soil. Presently, the department has approved anchors for installation in soil and in rock, but has no approved anchors for mixed soil. Even if there were such anchors available, there is a 12-month time period for testing new anchors under the department's requirements, with a cost to the anchor manufacturer of approximately $50,000.

Alternative anchoring systems approved by the department, such as custom-designed anchor systems or concrete pads with embedded anchors, are economically prohibitive for most consumers and homeowners who live in areas of difficult soils, or the systems are not designed for all home widths.

The department found that there was an immediate need for safe, affordable anchoring of new and used manufactured homes in difficult soils, without which there is an imminent peril to occupants and neighboring homes if such anchoring systems are not implemented.

An emergency rule is in effect until June that addresses the cross drive rock anchor installation requirements in §80.54(a) and the requirement for a ground vapor retarder in subsections (b) and (c). The emergency rules require that installers double the amount of cross drive rock anchors and diagonal ties (use two for each specified) when inserted in mixed rock and soil conditions or hard caliche soil in order to meet necessary holding requirements for wind resistance.

Based upon information provided by license holders and the public, the rule for doubling the amount of cross drive rock anchors and diagonal frame ties should continue. Installers need an additional method for anchoring homes until more devices and systems are invented and approved for use in difficult soils.

Bobbie Hill, Director of Manufactured Housing, has determined that for each year of the first five years the sections as proposed will be in effect, there will be no fiscal implications for state or local government as a result of enforcing or administering these sections.

Ms. Hill also has determined that for each year of the first five years the sections as proposed will be in effect, the public benefit as a result of enforcing the sections is improved quality of home installation and increased safety and durability of homes. The public benefit/probable economic costs for each section of the rules is as follows:

Amendment of §80.53 will improve communication about the choice that installers have to follow the generic installation instructions for cross drive rock anchors installed in difficult soil types. This improvement will benefit consumers and benefit large and small manufactured home retailing and installing businesses. There are no anticipated economic costs to persons/businesses who are required to comply with the section as proposed.

Amendment of §80.54 will enhance preservation of structural integrity for manufactured homes, lower energy costs for cooling, increase assurance that appliance drain and duct terminations will be properly installed, and increase public knowledge of the moisture and ground vapor control measures. This increased public knowledge of the moisture and ground vapor control measures will also benefit small and large businesses by enabling consumers to make more informed decisions about purchasing home site preparation services and moisture and ground vapor control measures. The anticipated economic costs to persons/businesses who are required to comply with the section as proposed will be minimal, since the additional costs will be passed on to consumers who choose to have the moisture and ground vapor control measures installed. The cost of compliance per home will be the same for small and large businesses. The material and installation cost of a ground vapor retarder will be approximately $100 for a single section home and $200 for a double section home. Any benefit resulting from lower energy costs for cooling cannot be precisely predicted, but a vapor barrier installed over the soil in the crawl space is recommended by the Texas State Energy Conservation Office publication, "Manufactured Homes."

The proposed ground vapor control measures do not increase the cost of every manufactured home installation. The proposed rule only requires the retailer or installer to install any required moisture and ground vapor control measures if the retailer or installer provides the materials for skirting or contracts for the installation of skirting. Retailers and installers may contract with consumers to install homes in accordance with the home installation instructions or the generic installation standards. If the home installation instructions only recommend or suggest a vapor retarder on the ground, the retailer or installer may follow the required home installation instructions and is not required to place a vapor retarder on the ground. When retailers or installers follow the proposed generic standards and contract to enclose the space under the home with skirting, the retailers or installers must install the moisture and ground vapor control measures required by the proposed generic standards in §80.54. The proposed rule about requiring a crawl space access opening will increase the manufactured home installation cost if the retailer or installer provides materials to enclose the crawl space under a home. The cost will be less than $50 per home.

Since the installation instructions for solid fuel burning fireplaces and direct vent system appliances presently require combustion air inlets to pass through skirting to the outside, the proposed rule does not increase the manufactured home installation cost.

Since the installation instructions for clothes dryer exhaust ducts and air conditioning condensation drains presently require proper terminations, the proposed rule does not increase the manufactured home installation cost when the retailer and/or installer provides the clothes dryer exhaust duct or air conditioning.

Amendment of §80.55 will provide a moderate cost anchoring method for difficult soils in the generic standards. This moderate cost anchoring method will also benefit small and large retailing and installing businesses. The anticipated economic costs to persons/businesses who are required to comply with the section as proposed will be more than the costs of a soil auger anchoring system, but the costs will be less than the costs of a slab with concrete anchors.

The generic rule (§80.55(d)(4)) will double the amount of cross drive rock anchors for difficult soils, such as mixed soil and rock or caliche (heavily weathered limestone) that is not solid rock. The amendment to rule §80.55(d)(4) will modify Table 4A in §80.55(d)(2). For difficult soils, a manufactured home installer cannot insert a soil auger anchor. The installer also cannot properly install a cross drive rock anchor, which is only designed for solid rock. A manufactured home installer must use another approved method. The following list describes the other approved methods and their limitations.

Alternative anchoring systems described by the home installation instructions: The limitation is that only a few home installation instructions describe anchoring systems other than soil auger anchors.

A custom designed anchoring system: The limitation is that an installer, retailer, or consumer must employ a Texas licensed engineer or architect to design the custom designed anchoring system. The anchoring system cost may range from moderate ($1000) to high ($3500).

An anchoring system pre-approved by the department: The limitation is that department pre-approved anchoring systems do not exist for all home dimensions, home weights, and installation conditions. The costs for these pre-approved anchoring systems may range from low ($400) to high ($3500).

Modified Table 4A in §80.55(d)(2): The limitation is that some homes designed for Wind Zone I have built-in vertical ties, but the notes for modified Table 4A do not describe a method for connecting vertical ties. For a home designed with built-in vertical ties, the installer must install custom designed anchors or pre-approved concrete anchors for the built-in vertical ties. A pre-approved concrete anchor must be installed in a concrete component with a weight conforming to the anchor installation instructions and the home installation instructions. The anchoring cost for a system conforming to the modified Table 4A would be a moderate cost (approximately $1000) if the home is designed without built-in vertical ties, and approximately $2000 if two built-in vertical ties must be connected to custom designed anchors or pre-approved concrete anchors.

The benefit for installers and consumers anticipated as a result of enforcement of these amendments would be a generic standard that provides a moderate cost anchoring method for difficult soils.

Comments may be submitted to Bobbie Hill, Director of Manufactured Housing, Texas Department of Housing and Community Affairs, 507 Sabine Street, Austin, Texas 78701 within 30 days of the date of this publication.

The amendments are proposed under the Texas Manufactured Housing Standards Act, Article 5221f, §9, which provides the department authority to amend, add, and repeal rules governing the Manufactured Housing Division of the department.

No other statute, code, or article is affected by the proposed amendments.

§80.53.Manufacturer's Design Requirements.

(a) - (d)

(No change.)

(e)

The manufacturer shall provide printed instructions with each new home specifying the location, orientation and required capacity of stabilizing components on which the design is based. The installer must use stabilizing components that have the required capacity and install them according to the anchor or stabilizing component manufacturer's current installation instructions. When soil auger anchor shafts are not installed in-line with the diagonal frame ties or the combined loads of two ties, approved stabilizer plates, or other approved methods, must be used in accordance with the installation instructions for the soil auger anchors and stabilizer plates. If a difficult soil, such as mixed soil and rock or caliche (heavily weathered limestone) that is not solid rock, exists at the homesite, the installer may install a home in accordance with the generic standards and §80.55(d)(4) of this title (relating to Anchoring Systems).

(f)

(No change.)

§80.54.Standards for the Installation of Manufactured Homes.

(a)

All manufactured homes shall be installed in accordance with one of the following:

(1)

the home manufacturer's installation instructions;

(2)

the state's generic standards set forth in this section , [ and ] §80.55 of this title (relating to Anchoring Systems) , [ and ] §80.56 of this title (relating to Multi-Section Connection Standards) , and modified by any appendix filed in accordance with §80.51(a)(2) of this title (relating to Manufactured Home Installation Requirements) ;

(3)

a custom designed stabilization system;

(4)

a stabilization system pre-approved by the department; or

(5)

on a permanent foundation.

(b)

Site Preparation Responsibilities and Requirements:

(1)

The purchaser is responsible for the proper preparation of the site where the manufactured home (new or used) is to be installed unless the home is installed in a rental community. Except in rental communities, the purchaser shall remove all debris, sod, tree stumps and other organic materials from all areas where footings are to be located. In areas where footings are not to be located, all debris, sod, tree stumps and other organic material shall be trimmed, cut, or removed down to a maximum height of 8 inches above the ground [ or to a lower level if needed to properly install the vapor retarder material ]. The retailer must give the purchaser a site preparation notice as described in this section prior to the execution of any binding sales agreement. If the installation is a secondary move, not involving a retail sale, the installer must give the homeowner the site preparation notice prior to any agreement for the secondary installation of the home.

(2)

If the retailer or installer provides the materials for skirting or contracts for the installation of skirting, the retailer or installer is responsible for installing any required [ the ] moisture and ground vapor control measures in accordance with the home installation instructions or the generic standards [ retarder ] and for providing for the proper cross ventilation of the crawl space. If the purchaser or homeowner contracts with a person other than the retailer or installer for the skirting, the purchaser or homeowner is responsible for installing the moisture and ground vapor control measures [ retarder ] and for providing for the proper cross ventilation of the crawl space.

(3)

Clearance: If the manufactured home is installed according to the state's generic standards, a [ A ] minimum clearance of 18 inches between the ground and the bottom of the floor joists must be maintained. In addition, the installer shall be responsible for installing the home with sufficient clearance between the I-Beams and the ground so that after the crossover duct prescribed by the manufacturer is properly installed it will not be in contact with the ground. Refer to §80.56 of this title (relating to Multi-Section Connection Standards) for additional requirements for [ access openings to the crawl space and ] utility connections. It is strongly recommended that the installer not install the home unless all debris, sod, tree stumps and other organic materials are removed from all areas where footings are to be located.

(4)

Drainage: Except in rental communities, proper drainage is the responsibility of the homeowner. It is strongly recommended that the installer not install the home unless the exterior grade is sloped away from the home or another approved method to prohibit surface runoff from draining under the home is provided. Drainage prevents water build-up under the home. Water build-up may cause shifting or settling of the foundation, dampness in the home, damage to siding and bottom board, buckling of walls and floors, delamination of floor decking and problems with the operation of windows and doors.

(5)

Generic Moisture and Ground Vapor Controls [ Control ]: If the manufactured home is installed according to the state's generic standards and the space under the home is to be enclosed with skirting and/or other materials provided by the retailer and/or installer, an access opening not less than 18 inches in any dimension and not less than three square feet in area shall be provided by the installer. The access opening shall be located so that any water supply and sewer drain connections located under the home are accessible for inspections. If a clothes dryer exhaust duct, air conditioning condensation drain, or combustion air inlet is present, the installer must pass it through the skirting to the outside. [ a vapor retarder that keeps ground moisture out of the home must be installed to prevent moisture damage to the structure. The installer shall ensure that a minimum 6 mil polyethylene sheeting or its equivalent is properly installed and the area under the home is covered with sheeting and overlapped approximately 12 inches at all joints. Any tear larger than 18 inches long or wide must be taped using a material appropriate for the sheeting used. The laps should be weighted down to prevent movement. Any small tears and/or voids around construction (footings, anchor heads, etc.) are acceptable. ] In addition, crawl space ventilation must be provided at the rate of minimum 1 square foot of net free area, for every 150 square feet of floor area. At least six openings shall be provided, one at each end of the home and two on each side of the home. The openings shall be screened or otherwise covered to prevent entrance of rodents (note: screening will reduce net free area). For example, a 16'x76' single section home has 1216 square feet of floor area. This 1216 square feet divided by 150 equals 8.1 square feet or 1166 square inches of net free area crawl space ventilation. The retailer and/or installer must notify the purchaser that moisture and ground vapor control measures are required if the space under the home is to be enclosed. [ The vapor retarder prevents water vapor build-up under the home. ] Water vapor build-up may cause dampness in the home, damage to siding and bottom board, buckling of walls and floors, delamination of floor decking and problems with the operation of windows and doors. [ For example, a 16'x76' single section home has 1216 square feet of floor area. This 1216 square feet divided by 150 equals 8.1 square feet or 1166 square inches of net free area crawl space ventilation. ] The generic ground vapor control measure shall consist of a ground vapor retarder that is minimum 6 mil polyethylene sheeting or its equivalent, installed so that the area under the home is covered with sheeting and overlapped approximately 12 inches at all joints. Any tear larger than 18 inches long or wide must be taped using a material appropriate for the sheeting used. The laps should be weighted down to prevent movement. Any small tears and/or voids around construction (footings, anchor heads, etc.) are acceptable.

(c)

Notice: The site preparation notice to be given to the consumer shall be as follows:

Figure: 10 TAC §80.54(c)

(d)

(No change.)

§80.55.Anchoring Systems.

(a) - (c)

(No change.)

(d)

WIND ZONE I Installation:

(1)

Typical anchor layout, single and multi-section units (WIND ZONE I ONLY):

Figure: 10 TAC §80.55(d)(1)

(2)

Table 4A: The following table describes the maximum spacing for diagonal ties along each side of the unit.

Figure: 10 TAC §80.55(d)(2)

(3)

(No change.)

(4)

When approved auger anchors cannot be inserted into a difficult soil, such as mixed soil and rock or caliche (heavily weathered limestone) that is not solid rock, approved cross drive rock anchors may be used in accordance with the values and notes for Table 4A in paragraph (2) of this subsection modified as follows:

(A)

since the ultimate anchor pull out in the difficult soil will be reduced, the maximum spacing for diagonal ties per side is one half the spacing allowed by Table 4A which will require adding one additional cross drive rock anchor for each anchor specified;

(B)

the rods of the approved cross drive rock anchors must be fully inserted, have at least 24 inches of the rod lengths embedded in the difficult soil, and be restrained from horizontal movement, when feasible, by a stabilizer plate between the rods and the home; and

(C)

each cross drive rock anchor is connected to one diagonal tie and is not connected to a vertical tie.

(e) - (f)

(No change.)

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on April 23, 1999.

TRD-9902409

Daisy A. Stiner

Executive Director

Texas Department of Housing and Community Affairs

Earliest possible date of adoption: June 6, 1999

For further information, please call: (512) 475-3726


Part V. Texas Department of Economic Development

Chapter 180. Industrial Projects

10 TAC §180.1, §180.2

The Texas Department of Economic Development (Department) proposes amendments to §180.1 and §180.2, relating to Industrial Projects. The amendments change the name of the Department to reflect the abolishment of the Texas Department of Commerce by Senate Bill 932 of the 75th Legislature and the transfer of that agency's functions to the Department, effective September 1, 1997, and update statutory citations to reflect other legislative action.

The proposed amendment to §180.1 changes the name of the Department.

The proposed amendment to §180.2 also changes the name of the Department to reflect the abolishment of the Texas Department of Commerce as well as changing the name of the Texas Employment Commission to the Texas Workforce Commission. These amendments also change legal citations to correctly reference sections of the Government Code, Tax Code and United States Code Annotated.

Craig Pinkley, Director of Finance, has determined that for each year of the first five years that the amendments will be in effect there will be no fiscal implications to the state or to local governments as a result of enforcing or administering the amendments. No cost to either government or the public will result from amendments. There will be no impact on small businesses. No economic cost is anticipated to persons as a result of amending Chapter 180.

Mr. Pinkley has also determined that for each year of the first five years the amendments are in effect the public benefit anticipated as a result of enforcing the rules will be the avoidance of any confusion that may be caused by incorrect legal citations or agency names. No economic costs are anticipated to persons who are required to comply with the proposed amendments.

Written comments on the proposed amendments should be submitted, within 30 days of the publication of the proposed amendments, to DeAnn Luper, Legal Assistant, Texas Department of Economic Development, 1700 N. Congress, Suite 130, Austin, Texas, 78701, for hand-deliveries, P.O. Box 12728, Austin, Texas, 78711-2728, for US Mail, and (512) 936-0415 for Facsimiles.

The amendments are proposed pursuant to Government Code, §481.0044(a), which directs the Governing Board of the Department to adopt rules for administration of Department programs, and Government Code, Chapter 2001, Subchapter B which prescribes the standards for rulemaking by state agencies.

Texas Civil Statutes, Article 5190.6 is affected by this proposal.

§180.1.General Rules.

(a)

Introduction. Pursuant to the authority granted by the Administrative Procedure and Texas Register Act, as amended, the Texas Department of Economic Development [ Commerce ] prescribes the following rules regarding practice and procedure before the department. The rules promulgated under this chapter are not applicable to local development corporations created pursuant to Texas Civil Statutes, Article 5190.6, §4A.

(b)-(c)

(No change.)

§180.2.Industrial Revenue Bond Program.

(a)

General.

(1)-(2)

(No change.)

(3)

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

(A)-(C)

(No change.)

(D)

Blighted area--Those areas and areas immediately adjacent thereto within a city which, by reason of the presence of a substantial number of substandard, slum, deteriorated, or deteriorating structures, or which suffer from a high relative rate of unemployment, or which have been designated and included in a tax incremental district [ created under the 66th Legislature, 1979, Texas Civil Statutes, Chapter 695, Article 1066d ], or any combination of the foregoing, which the city finds and determines, after a hearing held pursuant to subsection (b)(9)(A) of this section, substantially impair or arrest the sound growth of the city, or constitute an economic or social liability and/or a menace to the public health, safety, or welfare in their present condition and use. Blighted areas includes the terms "development area" as to any area designated by a city as a development area prior to October 1, 1985, and "economically depressed area," which must comply with the requirements set forth in subsection (b)(9)(B) and (10) of this section for eligibility as a blighted area.

(E)-(J)

(No change.)

(K)

Department--Texas Department of Economic Development [ Commerce ].

(L)-(N)

(No change.)

(O)

Federally assisted new community--Those federally assisted areas which have received or will receive assistance in the form of loan guarantees under the National Housing Act, Title X, and a portion of the federally assisted area has received grants under the 42 U.S.C.A. §5307 [ Housing and Community Development Act of 1974, §107(a)(1), as amended ].

(P)-(X)

(No change.)

(4)

(No change.)

(b)

Application contents.

(1)-(8)

(No change.)

(9)

Special rules for commercial projects in blighted areas and development areas. Under the Act, the financing of projects for commercial use is confined to, among others, geographic areas within the corporate limits of a city found and determined by the governing body of such city to be either a blighted area (or areas immediately adjacent thereto) or a development area. Rules for establishing a blighted area are set forth in subparagraph (A) of this paragraph. Rules for establishing a development area are set forth in subparagraph (B) of this paragraph.

(A)

Establishment of eligible blighted areas. The provisions of this subparagraph govern the method of establishing blighted areas and set forth the criteria to be used by a city in declaring an area (whether one or more) within its jurisdiction to be a blighted area.

(i)

(No change.)

(ii)

The department may refuse to approve all or any part of an area designated by a city as an eligible blighted area if the governing body of such city does not find that the designated area (whether one or more) is in a tax incremental district established by the city [ pursuant to and in accordance with the provisions of Texas Civil Statutes, Article 1066d ], or contains a substantial number of substandard, slum, deteriorated, or deteriorating structures, or suffers from a high relative rate of unemployment, or any combination of the foregoing. If the area or areas proposed to be designated as eligible blighted areas are not located in a tax incremental district [ as provided in Texas Civil Statutes, Article 1066d ], the determination of the existence of either a substantial number of slum, deteriorated, or deteriorating structures of a high relative rate of unemployment shall be in accordance with the following criteria.

(I)

Substandard structures. A geographic area constituting all or less than all of the geographic area within the corporate limits of a city may be designated as an eligible blighted area if:

(-a-)

the area is designated as a reinvestment zone pursuant to Tax Code, Chapter 311 [ Texas Civil Statutes, Article 1066e ], or Tax Code, Chapter 312 [ Texas Civil Statutes, Article 1066f ];

(-b-)

the area is designated as an enterprise zone by the city and the state Enterprise Zone Board as provided in Government Code, Chapter 2303 [ Senate Bill 752, 70th Legislature, 1987 ], and such designation is based in whole or in part on substandard structures; or

(-c-)

(No change.)

(II)

Unemployment.

(-a-)

A geographic area constituting all of the geographic area within the corporate limits of a city may be designated as an eligible blighted area if the governing body of the city finds that the city's actual civilian labor force unemployment rate for the most recent month for which data has been published by the Texas Workforce [ Employment ] Commission is equal to or in excess of one and one-half times the actual state unemployment rate for the same month, or the city's actual civilian labor force unemployment rate for the most recent calendar quarter or calendar year for which data has been published by the Texas Workforce [ Employment ] Commission is equal to or in excess of one and one-half times the average actual state unemployment rate for the same calendar quarter or calendar year, provided that in no event shall the resulting product be less than 9.0%.

(-b-)

A geographic area constituting less than all of the geographic area within the corporate limits of a city may be designated as an eligible blighted area if the governing body of the city finds that the percentage of unemployment of the civilian labor force residing in such area is equal to or in excess of the percentage of unemployment which would otherwise justify a designated area as provided in item (-a-) of this subclause, or that such area has been designated and approved by the state as an enterprise zone as provided by Government Code, Chapter 2303 [ Senate Bill 752, 70th Legislature, 1987 ], or that such area constitutes all or part of an area designated by any state or federal agency as an area of economic distress, blighted area, targeted area, or other similar designation, and which designation is based in whole or in part on unemployment, or any combination of the foregoing.

(-c-)

With respect to any area for which the unemployment data referred to in item (-a-) and item (-b-) of this subclause is not published or otherwise reasonably available from the Texas Workforce [ Employment ] Commission, a city may substitute alternative unemployment statistics upon a representation by the city that the substituted data is reasonably accurate and verifiable and is available for inspection by the department.

(iii)-(vi)

(No change.)

(B)-(C)

(No change.)

(10)-(12)

(No change.)

(c)

(No change.)

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on April 20, 1999.

TRD-9902327

Gary Rosenquest

Chief Administrative Officer

Texas Department of Economic Development

Earliest possible date of adoption: June 6, 1999

For further information, please call: (512) 936-0177


Chapter 197. Private Donations

10 TAC §§197.1, 197.2, 197.4, 197.6

The Texas Department of Economic Development (Department) proposes amendments to §§197.1, 197.2, 197.4, and 197.6 relating to Private Donations. The proposed amendments change the name of the Department to reflect the abolishment of the Texas Department of Commerce by Senate Bill 932 of the 75th Legislature and the transfer of that agency's functions to the Department, effective September 1, 1997. The amendments also change the Department's policy on acceptance of gifts to make it consistent with Government Code, Chapter 575, Acceptance of Gift by State Agency. The amendments further update legal citations to correctly reference sections of the Government Code.

The proposed amendments to §197.1 change the name of the Department, change the dollar value of gifts affected from $250 to $500, and update the name and citation of the Public Information Act.

The proposed amendment to §197.2 makes the donation process consistent with Government Code, Chapter 575.

The proposed amendment to §197.4 changes the reference of the state treasurer to the comptroller's treasury division.

The proposed amendment to §197.6 clarifies the process for notifying the agency of donations from prospective contractors.

Robin Abbott, General Counsel, has determined that for each year of the first five years that the amendments will be in effect there will be no fiscal implications to the state or to local governments as a result of enforcing or administering the amendments. No cost or reduction in cost to either government or the public is anticipated as a result of the amendments. There will be no impact on small businesses. No economic cost is anticipated to persons as a result of amending Chapter 197.

Ms. Abbott has also determined that for each year of the first five years the amendments are in effect the public benefit anticipated as a result of enforcing the rules will be the avoidance of any confusion that may be caused by incorrect wording, legal citations or agency names. No economic costs are anticipated to persons who are required to comply with the proposed amendments.

Written comments on the proposed amendments should be submitted, within 30 days of the publication of the proposed amendments, to DeAnn Luper, Legal Assistant, Texas Department of Economic Development, 1700 North Congress, Suite 130, Austin, Texas, 78701, for hand-deliveries, P.O. Box 12728, Austin, Texas, 78711-2728, for US Mail, and (512) 936-0415 for Facsimiles.

The amendments are proposed pursuant to Government Code, §481.0044(a), which directs the Governing Board of the Department to adopt rules necessary for the administration of the Department, and Government Code, Chapter 2001, Subchapter B, which prescribes the standards for rulemaking by state agencies.

Government Code, Chapter 481 is affected by this proposal.

§197.1.General Provisions.

(a)

Introduction. Private sector donations to the Texas Department of Economic Development [ Commerce ] can have a significant impact on the agency's success in stimulating economic development for the State of Texas. The Department of Economic Development [ Commerce ] is statutorily authorized to accept donations pursuant to the Texas Government Code, §481.021(a)(3). It shall be the policy of the department to accept only those donations that advance the purpose of the agency.

(b)

(No change.)

(c)

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

(1)

(No change.)

(2)

Department--Texas Department of Economic Development [ Commerce ].

(3)

Donation--The conveyance of a property interest or service the value of which is [ $250 ] or more. Donations may include, among other things, transfers of cash gifts, services, real property, leasehold estates, loaned employees, and grants, as well as in-kind personal gifts such as equipment, books, art, or memorabilia.

(4)

Donation agreement--The document [ donative instrument executed by the department and the donor ] which identifies the donated property and outlines any special conditions of the donation.

(5)-(7)

(No change.)

(8)

Officer--The executive director, governing [ policy ] board members, and advisory board members who serve the department [ through appointment by the governor ].

(d)

Examination of records. Any party requesting the examination of records pursuant to the Public Information [ Open Records ] Act, Texas Government Code, Chapter 552 [ Civil Statutes, Article 6252-17a ], shall indicate in writing the specific nature of the document to be viewed, and if photocopying is desired, agree to pay the appropriate fee [ must accompany the request ]. The department may seek a determination from the attorney general regarding the confidentiality of information relating to a donation before releasing requested information if the department determines an exception to the Public Information [ Open Records ] Act is applicable.

(e)

Written communication with the department. Communications to the department regarding donations should be addressed to the Executive Director, Texas Department of Economic Development [ Commerce ], P.O. Box 12728, Austin, Texas 78711.

§197.2.Procedure for Acceptance of Donations.

(a)

(No change.)

(b)

Donation agreement. The donor and the department shall execute a donation agreement which documents the name of the donor, a description of the donation, and the purpose of the donation. Acceptance of donations to the department shall be approved by the governing board in accordance with Texas Government Code, Chapter 575. [ includes the following information: ]

[(1)

a description of the donation, including a determination of the value;]

[(2)

a statement by the donor attesting to its ownership rights in the property;]

[(3)

the signature of the donor if the donor is an individual or its official representative if the donor is a business organization;]

[(4)

the signature of the executive director or his or her designee;]

[(5)

any conditions restricting the use of the donation if the donor imposes restrictions agreed to by the department;]

[(6)

the mailing address of the donor and principal place of business if the donor is a business entity;]

[(7)

a statement identifying any official relationship between the donor and the department;]

[(8)

a statement advising the donor to seek legal and/or tax advice from its own legal counsel.]

(c)

Deposited funds. The department shall deposit monetary contributions from private sources in a separate fund kept and held in escrow and in trust by the comptroller's treasury division [ state treasurer ] for and on behalf of the department as funds held outside the treasury under the Texas Government Code, §404.073. The money contributed shall be used to carry out the purposes of the department and, to the extent possible, the purposes specified by the donors.

§197.4.Acceptance of Donations.

[(a)

All donations made to the department shall be accepted by the executive director or his or her designee.]

[ (b) ]

All donations will be accepted on behalf of the department or corporation. No officer or employee of the department can accept donations in their individual capacity.

§197.6.Standard of Conduct between the Department and Private Donors.

The department shall contract with all persons and entities on a competitive basis to the greatest extent possible. Any person or entity seeking to contract with the department on a non- competitive [ bid ] basis [ or otherwise ] shall disclose all known [ previous ] donations to the department occurring within the proceeding two years [ to the department or any other state agency ]. The disclosure shall include the following information:

(1)

the nature and value of the donation; and

(2)

the date the donation was made [ and the recipient ]. If the donation is ongoing the last date that the donation was available to the department [ agency ] shall be used to determine the date of the donation.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on April 20, 1999.

TRD-9902328

Gary Rosenquest

Chief Administrative Officer

Texas Department of Economic Development

Earliest possible date of adoption: June 6, 1999

For further information, please call: (512) 936-0177