Part 1.
FINANCE COMMISSION OF TEXAS
Chapter 1.
CONSUMER CREDIT REGULATION
Subchapter E. INTEREST CHARGES IN LOANS
7 TAC §1.503
The Finance Commission of Texas adopts an amendment to 7
TAC §1.503, concerning interest charges in Subchapter E, loans. The amendment
is adopted without changes to the proposal as published in the March 8, 2002,
issue of the
Texas Register
(27 TexReg 1605).
The purpose of the amendment is to make technical and conforming changes
to the rule that clarifies the propriety of charging administrative loan fees
on multiple loans to the same borrower.
Section 1.503 addresses when a lender may charge an additional administrative
fee to a borrower who has multiple loans under Subchapter E. The modification
to Subchapter E under Senate Bill 272, 77th Legislature, created new limitations
on the assessment of administrative loan fees when a lender chooses to use
the new rate structure available under Subchapter E. When a lender uses the
new rate structure under Subchapter E, charges an administrative fee, and
then makes another loan to the same borrower the lender may not again assess
an administrative fee until the time limitation provided by the statute has
lapsed.
The agency received no written comments on the rule proposal.
The amendment is adopted under the Texas Finance Code §11.304
and §342.551, which authorizes the Finance Commission of Texas to adopt
rules to enforce Title 4 of the Texas Finance Code.
This rule affects Texas Finance Code Chapter 342, Subchapter E.
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 May 1, 2002.
TRD-200202727
Leslie L. Pettijohn
Commissioner
Finance Commission of Texas
Effective date: May 21, 2002
Proposal publication date: March 8, 2002
For further information, please call: (512) 936-7640
7 TAC §1.845
The Finance Commission of Texas adopts new §1.845, concerning
the filing of consumer complaints with the Office of Consumer Credit Commissioner.
The new rule is adopted without changes to the proposal as published in the
March 8, 2002, issue of the
Texas Register
(27 TexReg 1606).
New §1.845 implements the requirements of Finance Code §11.307,
pertaining to the filing of consumer complaints with the agency.
Section 1.845 specifies the manner in which regulated license holders provide
consumers with information on how to file complaints with the agency. The
section also requires that the information on how to file complaints be included
with each privacy notice a regulated license holder is required by law to
provide to consumers.
The agency received one written comment on the rule proposal from Charles
Johnson, LoanTec Financial Software. The comment letter expressed a belief
that there is little or no public benefit from the proposed rule and that
estimated programming costs to comply with the rule approximates $300.
The agency disagrees with the comment that there is no public benefit as
a result of the rule. The rule, required by statute, is designed to inform
borrowers of the procedure for filing complaints related to privacy and other
regulatory matters. The agency believes the rule is appropriate as presented.
Section 1.845 is adopted under the authority of Finance Code §11.307,
which requires the Finance Commission to adopt rules specifying the manner
in which regulated license holders provide consumers with information on how
to file complaints with the agency.
This rule affects Texas Finance Code, Chapters 11 and 342.
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 May 1, 2002.
TRD-200202726
Leslie L. Pettijohn
Commissioner
Finance Commission of Texas
Effective date: May 21, 2002
Proposal publication date: March 8, 2002
For further information, please call: (512) 936-7640
Subchapter F. ACCESS TO INFORMATION
7 TAC §3.112
The Finance Commission of Texas (the commission) adopts new §3.112,
concerning charges for providing public information. New §3.112 is adopted
without changes to the proposed text as published in the March 8, 2002, issue
of the
Texas Register
(27 TexReg 1607) and
the text will not be republished.
The commission adopts §3.112 in accordance with Government Code, §552.262,
which requires state agencies to use Texas Building and Procurement Commission
rules in determining charges for providing public information. New §3.112
incorporates the Texas Building and Procurement Commission rules by reference.
The commission received no comments regarding the proposal.
The new section is adopted under Government Code, §552.262,
which requires governmental entities to use Texas Building and Procurement
Commission rules in determining charges for providing public information.
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 May 1, 2002.
TRD-200202712
Everette D. Jobe
Certifying Official
Finance Commission of Texas
Effective date: May 21, 2002
Proposal publication date: March 8, 2002
For further information, please call: (512) 475-1300
Chapter 11.
MISCELLANEOUS
Subchapter A. GENERAL
7 TAC §11.27
The Finance Commission of Texas (the commission) adopts the
repeal of §11.27, concerning charges for public information requests,
without changes to the proposal as published in the March 8, 2002 issue of
the
Texas Register
(27 TexReg 1607). The repealed
section is replaced by new §3.112, adopted in this issue of the
Government Code, §552.262 requires governmental entities to use Texas
Building and Procurement Commission rules to determine charges for public
information requests. The repeal will delete obsolete requirements that do
not conform with these rules. The commission concurrently adopts new §3.112
that incorporates the Texas Building and Procurement Commission rules.
The commission received no comments regarding the proposed repeal.
The repeal is adopted under Government Code, §552.262, which
requires governmental entities to use Texas Building and Procurement Commission
rules in determining charges for providing public information.
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 May 1, 2002.
TRD-200202713
Everette D. Jobe
Certifying Official
Texas Department of Banking
Effective date: May 21, 2002
Proposal publication date: March 8, 2002
For further information, please call: (512) 475-1300
Subchapter B. REGULATION OF LICENSES
7 TAC §25.41
The Finance Commission of Texas (the commission) adopts an
amendment to §25.41 concerning the filing of consumer complaints with
the Texas Department of Banking (department). The amendment is adopted without
changes to the proposed text as published in the March 8, 2002, issue of the
The amendment clarifies the requirements of Finance Code, §11.307,
pertaining to the filing of consumer complaints with the department.
The amendment revises the language of the required notice to consumers
of prepaid funeral benefits contract sellers on how to file complaints with
the department to be consistent with the notice contained in the model prepaid
funeral benefits contract and required by §25.3(j) of this title (relating
to What Requirements Apply to a Non-Model Contract or Waiver). The amendment
also clarifies that the requirement to provide consumers with the required
notice when the consumer first obtains a product or service may be accomplished
by including the required notice in all prepaid funeral benefits contract
forms. The amendment also provides that the notice required to be included
with each privacy notice under subsection (b)(3) and required to be accessible
on a website offering consumer goods and services under subsection (b)(5)(B)
be in substantially the same language and form as the required notice set
out in subsection (b)(1).
The commission received no comments regarding the proposal.
The amendment is adopted under the authority of Finance Code, §11.307,
which requires the commission to adopt rules specifying the manner in which
prepaid funeral benefits contract sellers provide consumers with information
on how to file complaints 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 May 1, 2002.
TRD-200202721
Everette D. Jobe
Certifying Official
Texas Department of Banking
Effective date: May 21, 2002
Proposal publication date: March 8, 2002
For further information, please call: (512) 475-1300
7 TAC §26.2
The Finance Commission of Texas (the commission) adopts new §26.2,
concerning recordkeeping requirements for perpetual care cemeteries. New §26.2
is being adopted with nonsubstantive changes to the proposal as published
in the March 8, 2002 issue of the
Texas Register
(27 TexReg 1609). The text of new §26.2 will be republished.
New §26.2 requires perpetual care cemeteries to maintain records that
were previously recommended to be maintained under Texas Department of Banking
Policy Memorandum No. 1013 (November 25, 1996). The new section is being adopted
to appropriately formalize Policy Memorandum No. 1013 as a rule promulgated
under Health & Safety Code, §712.008. New §26.2 also requires
perpetual care cemeteries to maintain records relating to consumer complaints.
These records are necessary to examine consumer complaint files in accordance
with Health & Safety Code, §712.044(a).
New §26.2 will require perpetual care cemeteries to keep a general
file that includes records such as documents and correspondence relating to
perpetual care operations, financial information, sample forms of agreements,
trustee or bank statements, corporate information, and other documents required
to be maintained by provisions of Health & Safety Code, Chapters 711 and
712. It will also require perpetual care cemeteries to keep consumer complaint
files, purchase agreement or property location files, a historical register
of all interment rights sold, and a monthly recapitulation of all conveyances
of interment rights issued subsequent to an examination. Finally, new §26.2
will require that records be kept at the cemetery or corporate office. If
these locations are not conducive to examination, the proposed section authorizes
the banking department to examine the records at another more suitable location.
The commission received three comments. One commenter objected to the provision
in the rule authorizing the banking department to request delivery of the
records to a more suitable location if the cemetery or corporate office is
not suitable for examination purposes. The commenter stated that he could
not operate without the records. The commission made no changes based on the
comment because the records will be at the alternative location for only a
short period of time, usually three to four days. In addition, the cemetery
will have access to the records or the department will provide the cemetery
with any requested information in the records while they are located off-site.
Another commenter advised that the documents required to be maintained in
separate property purchaser files under proposed §26.3(b)(3) are kept
by some cemeteries in files identified by property location. The commenter
suggested authorization of property location files as an alternative to purchaser
files because the expense of converting these files to a system based on property
purchasers would be substantial. The commission agreed with alternative and
added it to the proposed provision. Another commenter requested that the commission
address the applicability of the rule to historical records. The commenter
stated that there will be no problem maintaining the required records on a
prospective basis; however, to provide all required information for records
going back more than a century would be onerous. The commission added subsection
(d) to §26.2 to address the comment and clarify that the provision's
recordkeeping requirements are prospective.
Two nonsubstantive changes were also made to clarify the proposed rule.
The first was to subsection (b)(1)(L) to clarify that the sales maps showing
all gardens, mausoleums, crematories, and columbaria will also show the sold
and unsold spaces within those gardens, mausoleums, crematories, and columbaria.
The second change was to subsection (c)(2). The proposed provision required
a perpetual care cemetery to deliver records to a mutually agreeable location
if the location of the records was not suitable for examination by banking
department personnel. The change clarifies that the banking department can
pick up the records at the cemetery and deliver them to the examination location
rather than requiring the cemetery to physically deliver them.
The section is adopted under Health & Safety Code, §712.008,
which authorizes the commission to adopt rules necessary to enforce and administer
Health & Safety Code, Chapter 712.
§26.2.What records am I required to maintain?
(a)
What unique defined terms are used in this section?
(1)
"You" or "I" means the owner or operator of a perpetual
care cemetery.
(2)
"Perpetual care property" or "property" means all niches,
crypts, and ground space sold in connection with perpetual care.
(3)
"Consumer complaint" means a written complaint relating
to the perpetual care fund or to discharge of the corporation's perpetual
care responsibilities that you receive from a consumer at your cemetery location.
The term does not include oral complaints.
(4)
"Maintain" means to store and retain information and documents
specified by this section in such a way that the information can be expeditiously
retrieved for examination by the commissioner, whether by hard copy or produced
electronically and printed for review.
(b)
What records must I maintain?
(1)
You must maintain the following records in a general file:
(A)
the current certificate of authority to operate a perpetual
care cemetery, unless prominently displayed in the cemetery office;
(B)
the latest filed annual statement required under Health &
Safety Code, §712.041;
(C)
your most current consolidated financial statement or,
in the alternative, your most current financial records and/or tax return,
provided that the records must substantiate your use or expenditure of fund
income;
(D)
a sample form of each purchase agreement you currently
use;
(E)
a sample form of each document of conveyance of interment
rights you currently use;
(F)
the current trust agreement governing the fund;
(G)
all examination reports and official correspondence sent
to you by the banking department during the preceding three years;
(H)
all trustee statements and all written correspondence from
the trustee that you received since the last examination;
(I)
minutes of each meeting of the cemetery corporation's board
of directors held since the last banking department examination or, if the
cemetery corporation is a wholly-owned subsidiary and does not hold board
meetings, minutes of each meeting of the parent corporation's board of directors
held since the last examination;
(J)
all correspondence you sent to or received from the banking
department during the preceding three years;
(K)
all maps, plats, and property dedications that you have
filed reflecting the dates of filing in the county records under Health &
Safety Code, §711.034;
(L)
your current sales maps showing the sold and unsold spaces
in all gardens, mausoleums, crematories, and columbaria in the cemetery;
(M)
records and photographs relating to lawn crypt construction
and completion, to demonstrate you complied with Health & Safety Code, §711.061;
(N)
each cemetery price list that you used at any time in the
preceding three years; and
(O)
your quarterly reconciliation of capital gains and losses
in the fund since the last examination, if your trust agreement includes capital
gains and losses in the definition of trust income.
(2)
You must maintain the following records in a segregated
consumer complaint file:
(A)
each written complaint that you received from a consumer
regarding the manner in which you operate the perpetual care cemetery or perform
your contractual obligations to a consumer; and
(B)
all written correspondence and other records relating to
a consumer complaint, including records showing how you resolved or otherwise
disposed of the complaint.
(3)
You must maintain either:
(A)
separate files for each property purchaser that contains
all executed property purchase agreements, conveyance documents, and all related
information; or
(B)
files referenced by property location if:
(i)
the cemetery maintains an alphabetical index on which the
names of the property owners or purchasers can be cross-referenced to their
property location; and
(ii)
the files contain all executed property purchase agreements,
conveyance documents, and all related information.
(4)
You must maintain, and update at least monthly, a historical
register of all interment rights sold, showing:
(A)
the purchaser's name;
(B)
the date of purchase;
(C)
the purchase agreement number;
(D)
a specific description of the property you sold; and
(E)
how and when you disposed of the purchase agreement, including
whether the agreement was conveyed, canceled, or voided.
(5)
You must maintain a monthly recapitulation of all conveyance
of interment rights issued since the date of your last examination that includes,
for each paid-in-full property sale:
(A)
the date the purchase agreement was executed;
(B)
the property purchaser's name;
(C)
the purchase agreement number;
(D)
the date that the purchase agreement was paid-in-full;
(E)
the conveyance document number;
(F)
the amount of ground area, number of crypts, or number
of niches conveyed under the purchase agreement, and the corresponding sales
price of each;
(G)
the deposits to the fund from sales, as required by Health &
Safety Code, §712.028;
(H)
any additional deposits to the fund:
(i)
that are required by contract in an amount in excess of
the deposits required by Health & Safety Code, §712.028;
(ii)
that result from exchanged or traded-in property;
(iii)
that result from the sale of additional or subsequent
rights of interment; or
(iv)
that are voluntarily made in excess of the amount of deposits
required by Health & Safety Code, §712.028;
(I)
total deposits for each conveyance, which is the sum of
subparagraphs (G) and (H) of this paragraph for each conveyance; and
(J)
cumulative monthly totals of the amounts listed in subparagraphs
(F), (G), and (H) of this paragraph.
(c)
Where do I need to keep the records required under this
section?
(1)
You must keep all required records at the perpetual care
cemetery's physical location or corporate office.
(2)
If the physical location of the records is not conducive
to examination by banking department personnel, the banking department may
request that you provide your records at a mutually agreeable location in
your area that is more suitable for conducting an examination. In this situation,
if you refuse to agree, the commissioner may consider your inaction to constitute
refusal to submit to an examination and initiate an appropriate enforcement
action against you under Health & Safety Code, §712.0441.
(d)
With respect to purchase agreements executed prior to the
effective date of this section, a perpetual care cemetery will not violate
this section if it cannot produce records required under this section that
were not previously required by statute or rule.
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 May 1, 2002.
TRD-200202722
Everette D. Jobe
Certifying Official
Texas Department of Banking
Effective date: May 21, 2002
Proposal publication date: March 8, 2002
For further information, please call: (512) 475-1300
7 TAC §26.3
The Finance Commission of Texas (commission) adopts new §26.3,
concerning written notice to prohibit interment of a homicide perpetrator
in the same perpetual care cemetery as the homicide victim. New §26.3
is adopted without changes to the proposed text as published in the March
8, 2002 issue of the
Texas Register
(27 TexReg
1610) and the text will not be republished.
New §26.3 will implement and clarify Health & Safety Code, §712.009,
which generally prohibits a perpetual care cemetery from interring an individual
that caused the death of a victim interred in the cemetery (barred individual)
upon receipt of a specified written notice. Health & Safety Code, §712.009(a)
requires the commission to adopt rules to implement the statute.
New §26.3 will provide guidance on how a cemetery should respond to
a written notice, what options are available to a cemetery that receives a
written notice, and how a cemetery should deal with the authorized representative
of the victim and the authorized representative of the barred individual.
The section will require the cemetery to maintain records relating to a written
notice for three years after the date of a written notice determined to be
invalid or ineffective, or ten years after the date of an effective written
notice or any subsequent renewal notice.
The commission requested comments on the proposed rule and eight specific
questions concerning its operation. One comment was received from an individual.
The commenter expressed concern that litigation would result from the cemetery's
refusal to inter an individual, especially in a situation where a family owns
burial lots and wants the individual buried near family members. No changes
were made based on the comment because Health & Safety Code, §712.009(e)
addresses the concern by providing that a cemetery prevented from interring
the remains of an individual under the statute may not be held liable for
damages by a person having the right to control the individual's remain.
The new section is adopted under Health & Safety Code, §712.009,
which requires the commission to adopt rules to implement that statutory provision.
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 May 1, 2002.
TRD-200202723
Everette D. Jobe
Certifying Official
Texas Department of Banking
Effective date: May 21, 2002
Proposal publication date: March 8, 2002
For further information, please call: (512) 475-1300
7 TAC §26.11
The Finance Commission of Texas (the commission) adopts an
amendment to §26.11 concerning the filing of consumer complaints with
the Texas Department of Banking (department). The section is adopted without
changes to the proposed text as published in the March 8, 2002, issue of the
The amendment clarifies the requirements of Finance Code, §11.307,
pertaining to the filing of consumer complaints with the department.
The amendment revises the language of the required notice to consumers
of perpetual care cemeteries on how to file complaints with the department
to be consistent with similar recently adopted rules applying Finance Code, §11.307
to other regulated industries. The amendment requires the required notice
be included in the perpetual care cemetery purchase agreement. The amendment
also provides that the notice required to be included with each privacy notice
under section (b)(3) and required to be accessible on a website offering consumer
goods and services under subsection (b)(5)(B) must be in substantially the
same language and form as the required notice set out in subsection (b)(1).
The commission received no comments regarding the proposal.
The amendment is adopted under the authority of Finance Code, §11.307,
which requires the commission to adopt rules specifying the manner in which
perpetual care cemeteries provide consumers with information on how to file
complaints 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 May 1, 2002.
TRD-200202724
Everette D. Jobe
Certifying Official
Texas Department of Banking
Effective date: May 21, 2002
Proposal publication date: March 8, 2002
For further information, please call: (512) 475-1300
Chapter 85.
RULES OF OPERATION FOR PAWNSHOPS
Subchapter D. OPERATION OF PAWNSHOPS
Subchapter J. AUTHORIZED LENDER'S DUTIES AND AUTHORITY
Chapter 3.
STATE BANK REGULATION
Part 2.
TEXAS DEPARTMENT OF BANKING
Chapter 25.
PREPAID FUNERAL CONTRACTS
Chapter 26.
PERPETUAL CARE CEMETERIES
Part 5.
OFFICE OF CONSUMER CREDIT COMMISSIONER