TITLE 16. ECONOMIC REGULATION

Part 2. PUBLIC UTILITY COMMISSION OF TEXAS

Chapter 25. SUBSTANTIVE RULES APPLICABLE TO ELECTRIC SERVICE PROVIDERS

Subchapter C. INFRASTRUCTURE AND RELIABILITY

16 TAC §25.55

The Public Utility Commission of Texas (commission) proposes new §25.55, relating to Substation Reliability. The commission proposes this new rule in an effort to implement recommendations made by Project Number 32182, PUC Investigation of Methods to Improve Electric and Telecommunications Infrastructure to Minimize Long Term Outages and Restoration Costs Associated With Gulf Coast Hurricanes ("Hurricane Infrastructure Report"). The proposed new rule will implement recommendations made in the Hurricane Infrastructure Report. Specifically, the new section will establish minimum requirements for the construction of electric transmission substation facilities above the 100-year floodplain and for providing emergency power at critical transmission substations to ensure the safe and reliable operation of the substation facilities during power outages and severe flooding. Project Number 34737 is assigned to this proceeding.

Brian Almon, Director, Transmission Analysis, has determined that for each year of the first five-year period the proposed section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section.

Mr. Almon has determined that for each year of the first five years the proposed section is in effect the public benefit anticipated as a result of enforcing the section will be a more reliable electric infrastructure that will be more capable of responding to natural disasters. There will be no adverse economic effect on small businesses or micro-businesses as a result of enforcing this section; therefore, no regulatory flexibility analysis is required. There may be economic costs to persons who are required to comply with the proposed section. These costs are associated with providing emergency power at critical transmission substations and the potential extra design and acquisition costs associated with ensuring transmission substation facilities are above the 100-year floodplain. Further, the costs associated with complying with this section are likely to vary from business to business and are difficult to ascertain. However, as explained in the Hurricane Infrastructure Report, it is believed that the benefits accrued from implementing the proposed section will outweigh the costs.

Mr. Almon has also determined that for each year of the first five years the proposed section is in effect there should be no adverse effect on a local economy, and therefore no local employment impact statement is required under Administrative Procedure Act (APA), Texas Government Code §2001.022.

The commission staff will conduct a public hearing on this rulemaking, if requested, pursuant to the Administrative Procedure Act, Texas Government Code §2001.029 in Hearing Room Gee, located on the 7th floor of the William B. Travis Building, 1701 North Congress Avenue, Austin, Texas 78701, on Thursday, May 1, 2008, at 9:30 a.m. The request for a public hearing must be received within 30 days after publication.

Comments on the proposed new section may be submitted to the Filing Clerk, Public Utility Commission of Texas, 1701 North Congress Avenue, P.O. Box 13326, Austin, Texas 78711-3326, within 30 days after publication. Sixteen copies of comments to the proposed amendment are required to be filed pursuant to §22.71(c) of this title. Reply comments may be submitted within 45 days after publication. Comments should be organized in a manner consistent with the organization of the proposed rule(s). The commission invites specific comments regarding the costs associated with, and benefits that will be gained by, implementation of the proposed section. The commission will consider the costs and benefits in deciding whether to adopt the section. All comments should refer to Project Number 34737.

This new section is proposed under the Public Utility Regulatory Act, Texas Utilities Code Annotated §14.002 (Vernon 2007 and Supp. 2007) (PURA), which provides the Public Utility Commission with the authority to make and enforce rules reasonably required in the exercise of its powers and jurisdiction; and specifically, PURA §14.001, which gives the commission the general power to regulate and supervise the business of each public utility; PURA §38.001, which provides that electric utilities and electric cooperatives shall furnish service that is safe, adequate, efficient, and reasonable; §38.002, which grants the commission authority to adopt rules relating to just and reasonable standards an electric utility must follow in furnishing service and rules relating to customer protection; and §38.071, which provides the commission with authority to order an electric utility to provide improvements in its service.

Cross Reference to Statutes: Public Utility Regulatory Act §§14.001, 14.002, 38.001, 38.002, and 38.071.

§25.55.Substation Reliability.

(a) Purpose. The purpose of this section is to establish minimum requirements for the construction of new transmission substation facilities above the 100-year floodplain and for provision of emergency power equipment at critical transmission substations sufficient to ensure the safe and reliable operation of the substation facilities during station service power outages and severe flooding.

(b) Application. This section applies to all electric utilities as defined by the Public Utility Regulatory Act (PURA) §31.002(6) and all transmission and distribution utilities as defined by PURA §31.002(19). The term "utility" as used in this section shall mean an electric utility or a transmission and distribution utility.

(c) Definitions.

(1) Transmission substation--An electrical installation, or any portion of an electrical installation, containing one or more of the following:

(A) an electrically operated switching facility for one or more transmission lines;

(B) a load-serving transformer energized at 60 kilovolts or above.

(2) New transmission substation--A transmission substation whose construction commenced on or after the date the requirements of this section take effect.

(3) Critical transmission substation--A transmission substation that has been identified at the time it is designed as a "Critical Asset" or that contains facilities designated as "Critical Assets" using the framework for identification of critical assets incorporated in the approved North American Electric Reliability Corporation (NERC) reliability standards.

(d) Emergency power. Every two years after the initial determination or more frequently if required by NERC, each utility shall determine whether each of its energized transmission substations is a critical transmission substation. Further, each utility shall, at the time it is designing any new transmission substation, determine whether the energized substation will be identified as a critical transmission substation as defined in subsection (c)(3) of this section. For each transmission substation identified as critical, the utility shall ensure the normal operation of all transmission-related substation facilities for a period of 72 hours after loss of the sources of station service power to the substation.

(e) Construction above floodplain. For a new transmission substation that will be located in a 100-year floodplain, a utility shall design and construct the substation so that the electrically energized portions of all substation transmission facilities shall be not less than one foot above the 100-year floodplain. The utility shall determine whether the location of the substation is in a 100-year floodplain using floodplain maps from the Federal Emergency Management Agency (FEMA). If FEMA maps are not available for the site of the substation, the utility shall use a Texas-registered Professional Engineer or a Professional Hydrologist as certified by the American Institute of Hydrology to determine the location of the floodplain.

(1) This subsection applies to an expansion of an existing transmission substation, except for a substation that has already undergone sufficient site preparation for the installation of such transmission facilities.

(2) This subsection shall not apply to transmission facilities that have been designed to operate underwater or underground.

(f) Effective date. This section takes effect on January 1, 2011.

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 February 22, 2008.

TRD-200801096

Adriana A. Gonzales

Rules Coordinator

Public Utility Commission of Texas

Earliest possible date of adoption: April 6, 2008

For further information, please call: (512) 936-7223


Subchapter J. COSTS, RATES AND TARIFFS

Division 1. RETAIL RATES

16 TAC §25.237

The Public Utility Commission of Texas (commission) proposes an amendment to §25.237, relating to Fuel Factors. Current §25.237 allows utilities to petition for fuel factor modifications once every six months according to a fixed schedule and a prescribed filing package. The proposed amendment establishes the option, and procedure, for utilities to determine their fuel factors by using a commission-approved, utility-specific fuel factor formula. The proposed amendment allows utilities that use such a commission-approved, utility-specific fuel factor formula to request more frequent fuel factor modifications--as often as once every four months, except for the month of December, and not subject to a set schedule. The proposed amendment also establishes a procedure for the approval of the proposed fuel factors on an interim basis for utilities that use a commission-approved, utility-specific formula.

The proposed amendment is anticipated to facilitate a more timely recovery of fuel expenses, reduce the size of over- and under-recovery balances passed on to customers, and provide more accurate price signals to customers. The commission anticipates that, by utilizing an established, utility-specific fuel factor formula, issues that may occur in a prescribed filing package proceeding and that are likely to result in a hearing can be eliminated. Therefore, the option to utilize a commission-approved, utility-specific formula streamlines the administrative review process, limits the issues the commission may have to address in a proceeding and may result in timelier processing of fuel factor modification requests.

Procedurally, the proposed amendment also requires a utility to serve its complete petition package on each party in the utility's most recent fuel reconciliation and on the Office of Public Utility Counsel. Service shall be accomplished by email if possible. This will enable interested parties to begin review of the requested fuel factor revisions at an earlier time and will help to expedite such proceedings. Project Number 34914 is assigned to this proceeding.

Larry Reed, Infrastructure and Reliability Division, has determined that for each year of the first five-year period the proposed amendment is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section.

Mr. Reed has determined that for each year of the first five years the proposed section is in effect the public benefit anticipated as a result of enforcing the amendment will be that utilities will be able to more accurately reflect actual fuel expenses in their fuel factor and thereby reduce the over- and under-collections passed on to customers, in addition to providing customers with more accurate price signals. Additionally, the amendment will allow more expedited and efficient processing of fuel factor revisions, reducing regulatory burdens on all parties involved.

Mr. Reed has determined that there will be no adverse economic effect on small businesses or micro-businesses as a result of enforcing this amendment. Mr. Reed has also determined that there is no anticipated economic cost to persons who are required to comply with the amendment as proposed. Therefore, no regulatory flexibility analysis is necessary.

Mr. Reed has also determined that for each year of the first five years the proposed amendment is in effect there should be no effect on a local economy, and therefore no local employment impact statement is required under Administrative Procedure Act (APA), Texas Government Code §2001.022.

The commission staff will conduct a public hearing on this rulemaking, if requested, pursuant to the Administrative Procedure Act, Texas Government Code §2001.029, at the commission's offices located in the William B. Travis Building, 1701 North Congress Avenue, Austin, Texas 78701 on Tuesday, April 29, 2008, at 10:00 a.m. A written request for a public hearing must be received within 31 days after publication.

Comments on the proposed amendment to §25.237 may be submitted to the Filing Clerk, Public Utility Commission of Texas, 1701 North Congress Avenue, P.O. Box 13326, Austin, Texas 78711-3326, not later than 31 days after publication. Sixteen copies of comments to the proposed amendment are required to be filed. Reply comments must be submitted not later than 45 days after publication. Comments should be organized in a manner consistent with the organization of the proposed amendment. All comments should refer to Project Number 34914.

The amendment to §25.237 is proposed under the Public Utility Regulatory Act, Texas Utilities Code Annotated §14.002 (Vernon 2007 and Supplement 2007) (PURA), which provides the Public Utility Commission with the authority to make and enforce rules reasonably required in the exercise of its powers and jurisdiction; and PURA §36.203, which authorizes the commission to adopt rules that provide for the timely adjustment of a utility's fuel factor.

Cross Reference to Statutes: Public Utility Regulatory Act §14.002 and §36.203.

§25.237.Fuel Factors.

(a) Use and calculation of fuel factors. An electric utility's fuel costs will be recovered from the electric utility's customers by the use of a fuel factor that will be charged for each kilowatt-hour (kWh) consumed by the customer.

(1) An electric utility may determine its fuel factor in dollars per kilowatt-hour pursuant to either subparagraph (A) or (B) of this paragraph. [ Fuel factors are determined by dividing the electric utility's projected net eligible fuel expenses, as defined in §25.236(a) of this title (relating to Recovery of Fuel Costs), by the corresponding projected kilowatt-hour sales for the period in which the fuel factors are expected to be in effect. ] Fuel factors must account for system losses and for the difference in line losses corresponding to the [ type of ] voltage at which the electric service is provided. An electric utility may have different fuel factors for different times of the year to account for seasonal variations. A different method of calculation may be allowed upon a showing of good cause by the electric utility.

(A) Fuel factors may be determined by dividing the electric utility's projected net eligible fuel expenses, as defined in §25.236(a) of this title (relating to Recovery of Fuel Costs), by the corresponding projected kilowatt-hour sales for the period in which the fuel factors are expected to be in effect.

(B) Fuel factors may be determined using a commission-approved, utility-specific fuel factor formula. Fuel factor formulas may be approved or revised only in a general rate change proceeding or a proceeding to consider an application to establish a fuel factor formula with notice and an opportunity for a hearing.

(2) An electric utility may initiate a change to its fuel factor as follows:

(A) Pursuant to subsection (a)(1)(A) of this section, an [ An ] electric utility may petition to adjust its fuel factor as often as once every six months according to the schedule set out in subsection (d) of this section.

(B) Pursuant to subsection (a)(1)(B) of this section, an electric utility may petition to adjust its fuel factor in accordance with its approved fuel factor formula no sooner than three months after the issuance of a final order approving its most recent fuel factor adjustment.

(C) [ (B) ] Notwithstanding subsection (a)(2)(A) of this section, an [ An ] electric utility may petition to change its fuel factor at times other than provided in the schedule if an emergency exists as described in subsection (f) of this section.

(D) [ (C) ] An electric utility's fuel factor may be changed in any general rate proceeding.

(3) Fuel factors are temporary rates, and the electric utility's collection of revenues by fuel factors is subject to the following adjustments:

(A) The reasonableness of the fuel costs that an electric utility has incurred will be periodically reviewed in a reconciliation proceeding, as described in §25.236 of this title, and any disallowed [ unreasonable ] costs resulting from a reconciliation proceeding [ incurred ] will be reflected in [ refunded to ] the calculation of the utility's recoverable fuel and over/(under) collections [ electric utility's customers ].

(B) To the extent that there are variations between the fuel costs incurred and the revenues collected, it may be necessary or convenient to refund overcollections or surcharge undercollections. Refunds or surcharges may be made without changing an electric utility's fuel factor . An electric utility may petition for a surcharge if [ , but requests by the electric utility to make refunds or surcharges may only be made at the times allowed by this paragraph. An electric utility may petition to make refunds or surcharges at the specified times that these rules allow an electric utility to change its fuel factor irrespective of whether the electric utility actually petitions to change its fuel factor at that time. An electric utility shall petition for a surcharge at the next date allowed for setting a fuel factor by the schedule set out in subsection (d) of this section when ] it has materially undercollected its fuel costs and projects that it will continue to be in a state of material undercollection. An electric utility shall petition to make a refund if [ at any time that ] it has materially overcollected its fuel costs and projects that it will continue to be in a state of material overcollection. "Materially" or "material," as used in this section, shall mean that the cumulative amount of over- or under-recovery, including interest, is greater than or equal to 4.0% of the annual actual [ estimated ] fuel cost figures on a rolling 12-month basis [ figure most recently adopted by the commission ], as reflected in the utility's monthly fuel cost reports as filed by the utility [ shown by the electric utility's fuel filings ] with the commission.

(b) Petitions to revise fuel factors.

(1) An electric utility using the fuel factor methodology set forth under subsection (a)(1)(A) of this section may file a petition requesting revised fuel factors pursuant to subsection (a)(2)(A) of this section during [ During ] the first five business days of the months specified in subsection (d) of this section[ , each electric utility using one or more fuel factors may file a petition requesting revised fuel factors ]. A copy of the complete petition package shall be served on each party in the utility's most recent fuel reconciliation and on [ filing shall also be delivered to the Office of Regulatory Affairs and ] the Office of Public Utility Counsel. Service shall be accomplished by email if possible. Each complete filing package shall include [ petition must be accompanied by ] the commission-prescribed [ commission prescribed ] fuel factor application , a tariff sheet reflecting the proposed fuel factors and supporting testimony that includes the following information:

(A) [ (1) ] For each month of the period in which the fuel-factor has been in effect and has not been reconciled up to the most recent month for which information is available,

(i) [ (A) ] the revenues collected pursuant to fuel factors by customer class;

(ii) [ (B) ] any other items that to the knowledge of the electric utility have affected fuel factor revenues and eligible fuel expenses; and

(iii) [ (C) ] the difference, by customer class, between the revenues collected pursuant to fuel factors and the eligible fuel expenses incurred.

(B) [ (2) ] For each month of the period for which the revised fuel factors are expected to be in effect, provide system energy input and sales, accompanied by the calculations underlying any differentiation of fuel factors to account for differences in line losses corresponding to the [ type of ] voltage at which the electric service is provided.

(2) An electric utility using the fuel factor formula methodology set forth under subsection (a)(1)(B) of this section may file a petition requesting revised fuel factors pursuant to subsection (a)(2)(B) of this section at least 15 days prior to the first billing cycle in the billing month in which the proposed fuel factors are requested to become effective. A copy of the complete petition package shall be served on each party in the utility's most recent fuel reconciliation and on the Office of Public Utility Counsel. Service shall be accomplished by email if possible. Each complete filing package shall include:

(A) a tariff sheet reflecting the proposed fuel factors;

(B) workpapers supporting the calculation of the revised fuel factors;

(C) calculations underlying any differentiation of fuel factors to account for differences in line losses corresponding to the voltage at which the electric service is provided; and

(D) any computer generated documents must be provided in their native electronic format with all cells and internal formulas disclosed.

(c) Fuel factor revision proceeding. Burden of proof and scope of proceeding are as follows:

(1) In a proceeding to revise fuel factors pursuant to subsection (a)(1)(A) of this section , an electric utility has the burden of proving that:

(A) the expenses proposed to be recovered through the fuel factors are reasonable estimates of the electric utility's eligible fuel expenses during the period that the fuel factors are expected to be in effect;

(B) the electric utility's estimated monthly kilowatt-hour system sales and off-system sales are reasonable estimates for the period that the fuel factors are expected to be in effect; and

(C) the proposed fuel factors are reasonably differentiated to account for line losses corresponding to the [type of] voltage at which the electric service is provided.

(2) The scope of a fuel factor revision proceeding under subsection (a)(1)(B) of this section is limited to the issue of whether the petitioning electric utility has appropriately calculated its proposed fuel factors [ estimated eligible fuel expenses and load ]. In a proceeding to revise fuel factors pursuant to subsection (a)(1)(B) of this section, an electric utility has the burden of proving that:

(A) the electric utility has calculated its proposed fuel factors in compliance with the commission-approved fuel factor formula; and

(B) the proposed fuel factors utilize a commission-approved adjustment to account for line losses corresponding to the voltage at which the electric service is provided.

(d) Schedule for filing petitions to revise fuel factors. A petition to revise fuel factors or to initiate or revise a fuel factor formula may be filed with any general rate proceeding.

(1) Otherwise, except as provided by subsection (f) of this section which addresses emergencies, petitions by an electric utility to revise fuel factors pursuant to subsection (a)(1)(A) of this section may only be filed [ during the first five business days of the month ] in accordance with the following schedule:

(A) [ (1) ] February [ January ] and August [ July ]: El Paso Electric Company [ and Central Power and Light Company ];

[ (2) February and August: Texas Utilities Electric Company; ]

(B) [ (3) ] March and September: [ West Texas Utilities Company and ] Entergy Gulf States, Inc.;

(C) [ (4) ] April and October: Southwestern Public Service [ Houston Lighting & Power ] Company;

(D) [ (5) ] May and November: Southwestern Electric Power Company[ , Southwestern Public Service Company, and Lower Colorado River Authority ]; and

(E) [ (6) ] July and January: [ June and December: Texas-New Mexico Power Company, and ] any other electric utility not named in this subsection that uses one or more fuel factors.

(2) Petitions by an electric utility to revise fuel factors pursuant to subsection (a)(1)(B) of this section may be filed in any month except December.

(e) Procedural schedules [ schedule ].

(1) Upon the filing of a petition to revise fuel factors pursuant to subsection (a)(1)(A) of this section [ in a separate proceeding ], the presiding officer shall set a procedural schedule that will enable the commission to issue a final order in the proceeding as follows:

(A) [ (1) ] within 60 days after the petition was filed, if no hearing is requested within 30 days of the petition; and

(B) [ (2) ] within 90 days after the petition was filed, if a hearing is requested within 30 days of the petition. If a hearing is requested, the hearing will be held no earlier than the first business day after the 45th day after the application was filed.

(2) Upon the filing of a petition to revise fuel factors pursuant to subsection (a)(1)(B) of this section, the presiding officer shall set a procedural schedule as follows:

(A) the presiding officer shall issue an order approving the proposed fuel factors on an interim basis no later than 12 days after the date the petition was filed, if no objection to interim approval is filed within 10 days after the date the petition was filed;

(B) if no hearing is requested within 30 days after the petition was filed, the presiding officer shall, after submission of proof of notice by the electric utility, issue an order approving the fuel factors without hearing or action by the commission; and

(C) if a hearing is requested within 30 days after the petition was filed, the hearing will be held no earlier than the first business day after the 45th day after the petition was filed and a final order will be issued within 90 days after the petition was filed, subject to submission of proof of notice by the electric utility.

(f) Emergency revisions to the fuel factor. If fuel curtailments, equipment failure, strikes, embargoes, sanctions, or other reasonably unforeseeable circumstances have caused a material under-recovery of eligible fuel costs, the electric utility may file a petition with the commission requesting an emergency interim fuel factor. Such emergency requests shall state the nature of the emergency, the magnitude of change in fuel costs resulting from the emergency circumstances, and other information required to support the emergency interim fuel factor. The commission shall issue an interim order within 30 days after such petition is filed to establish an interim emergency fuel factor. If within 120 days after implementation, the emergency interim factor is found by the commission to have been excessive, the electric utility shall refund all excessive collections with interest calculated on the cumulative monthly ending under- or over-recovery balance in the manner and at the rate established by the commission for overbilling and underbilling in §25.28(c) and (d) of this title (relating to Bill Payment and Adjustments Billing). If, after full investigation, the commission determines that no emergency condition existed, a penalty of up to 10% of such over-collections may also be imposed on investor-owned electric utilities.

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 February 22, 2008.

TRD-200801083

Adriana A. Gonzales

Rules Coordinator

Public Utility Commission of Texas

Earliest possible date of adoption: April 6, 2008

For further information, please call: (512) 936-7223


Chapter 26. SUBSTANTIVE RULES APPLICABLE TO TELECOMMUNICATIONS SERVICE PROVIDERS

Subchapter C. INFRASTRUCTURE AND RELIABILITY

16 TAC §26.56

The Public Utility Commission of Texas (commission) proposes new §26.56, relating to Central Office and Remote Facilities Reliability. The commission proposes this new rule in an effort to implement recommendations made by Project Number 32182, PUC Investigation of Methods to Improve Electric and Telecommunications Infrastructure to Minimize Long Term Outages and Restoration Costs Associated with Gulf Coast Hurricanes ("Hurricane Infrastructure Report"). The proposed new rule will implement recommendations made in the Hurricane Infrastructure Report. Specifically, the proposed new rule will establish minimum requirements for the construction of a central office or remote facility above the 100-year floodplain and for the installation of emergency power at a central office to ensure safe and reliable operation during power outages and severe flooding. Project Number 34742 is assigned to this proceeding.

Nara Srinivasa, Director of the Reliability and Licensing Section in the Infrastructure and Reliability Division, has determined that for each year of the first five-year period the proposed section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section.

Nara Srinivasa has determined that for each year of the first five years the proposed section is in effect the public benefit anticipated as a result of enforcing the section will be a more reliable telecommunication system that is better capable of responding to a natural disaster. There will be no adverse economic effect on small businesses or micro-businesses as a result of enforcing this section. Therefore, no regulatory flexibility analysis is required. There may be economic costs to persons who are required to comply with the proposed section. These costs are associated with providing emergency power at central offices and the potential extra design and acquisition costs associated with constructing central offices and remote facilities above the 100-year floodplain. Further, the costs associated with complying with this section are likely to vary from business to business and are difficult to ascertain. However, as explained in the Hurricane Infrastructure Report, it is believed that the benefits accrued from implementing the proposed section will outweigh the costs.

Nara Srinivasa has also determined that for each year of the first five years the proposed section is in effect there should be no adverse effect on a local economy, and therefore no local employment impact statement is required under Administrative Procedure Act (APA), Texas Government Code §2001.022.

The commission staff will conduct a public hearing on this rulemaking, if requested, pursuant to the Administrative Procedure Act, Texas Government Code §2001.029 in Hearing Room Gee, located on the 7th floor of the William B. Travis Building, 1701 North Congress Avenue, Austin, Texas 78701, on Wednesday, April 30, 2008, at 9:30 a.m. The request for a public hearing must be received within 30 days after publication.

Comments on the proposed new section may be submitted to the Filing Clerk, Public Utility Commission of Texas, 1701 North Congress Avenue, P.O. Box 13326, Austin, Texas 78711-3326, within 30 days after publication. Sixteen copies of comments to the proposed amendment are required to be filed pursuant to §22.71(c) of this title. Reply comments may be submitted within 45 days after publication. Comments should be organized in a manner consistent with the organization of the proposed rule(s). The commission invites specific comments regarding the costs associated with, and benefits that will be gained by, implementation of the proposed section. The commission will consider the costs and benefits in deciding whether to adopt the section. All comments should refer to Project Number 34742.

This new section is proposed under the Public Utility Regulatory Act, Texas Utilities Code Annotated §14.002 (Vernon 2007 and Supp. 2007) (PURA), which provides the Public Utility Commission with the authority to make and enforce rules reasonably required in the exercise of its powers and jurisdiction; and specifically, PURA §14.001, which gives the commission the general power to regulate and supervise the business of each public utility; PURA §52.106, which grants the commission the authority to regulate rates, operations, and services of telecommunication utilities so that the services provided are adequate and efficient, and PURA §55.002, which grants the commission the authority to adopt just and reasonable standards, classifications, rules, or practices a telecommunication utility must follow in furnishing a service.

Cross Reference to Statutes: Public Utility Regulatory Act §§14.001, 14.002, 52.106, and 55.002.

§26.56.Central Office and Remote Facilities Reliability.

(a) Purpose. The purpose of this section is to establish minimum requirements for the construction of new central offices and remote facilities above the 100-year floodplain and for the installation of emergency power at all central offices located in coastal areas to ensure safe and reliable operation during power outages and severe flooding.

(b) Application. This section applies to all certificated telecommunications utilities (CTU) as defined by §26.5(36) of this title relating to Definitions.

(c) Definitions.

(1) Central Office--A switching unit in a telecommunications system that provides service to the general public and that has the necessary equipment and operating arrangements for terminating and interconnecting customer lines and trunks or trunks only.

(2) Remote Facility--remote switch, digital loop carrier, or pair gain devise.

(3) Coastal Areas--The areas located within the Hurricane Evacuation Zone Boundary as established by the Texas Department of Emergency Management.

(d) Emergency power. CTUs shall have each of its central offices located in coastal areas capable of full and complete normal operation for 72 hours after loss of the sources of electric utility provided electricity.

(e) Construction. For a new central office or remote facility that will be located in a 100-year floodplain, a CTU shall design and construct the central office or remote facility so that the electrically energized portions shall be not less than one foot above the 100-year floodplain. The CTU shall determine whether the location of the substation is in a 100-year floodplain using floodplain maps from the Federal Emergency Management Agency (FEMA). If FEMA maps are not available for the site of the central office or remote facility, the CTU shall use a Texas-registered Professional Engineer or a Professional Hydrologist as certified by the American Institute of Hydrology to determine the location of the floodplain.

(f) Effective Date. This section takes effect on January 1, 2010.

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 February 22, 2008.

TRD-200801085

Adriana A. Gonzales

Rules Coordinator

Public Utility Commission of Texas

Earliest possible date of adoption: April 6, 2008

For further information, please call: (512) 936-7223


Chapter 27. RULES FOR ADMINISTRATIVE SERVICES

Subchapter B. HISTORICALLY UNDERUTILIZED BUSINESSES

16 TAC §27.31

The Public Utility Commission of Texas (commission) proposes an amendment to §27.31 relating to Historically Underutilized Business Program. The amendment to §27.31 is necessary in order to incorporate the changes enacted through House Bill 3560, 80th Legislature, 2007 (HB 3560) which renamed the Texas Building and Procurement Commission as the Texas Facilities Commission and transferred certain duties from the Texas Building and Procurement Commission to the Comptroller of Public Accounts. Specifically, the Texas Facilities Commission retains its powers and duties that relate to buildings and facilities, surplus and salvage property and child care services for state employees. All other duties and powers of the Texas Building and Procurement Commission were transferred to the Comptroller of Public Accounts. Under the HB 3560, rules of the Texas Building and Procurement Commission that are related to an activity transferred by the bill to the Comptroller of Public Accounts continue in effect as the rules of the Comptroller of Public Accounts until superseded by an act of the Comptroller of Public Accounts. The name change and transfer of duties became effective September 1, 2007. Before September 1, 2007, the commission, under Texas Government Code §2161.003, was required to adopt the Historically Underutilized Business (HUB) Program rules from the Texas Building and Procurement Commission (formerly called the Texas General Services Commission). As a result, the current §27.31 states that "the commission adopts by reference the rules of the Texas General Services Commission." Because the HUB program rules, which were located under Title 1, Part 5, Chapter 111, Subchapter B, have now been transferred and reorganized under Title 34, Part 1, Chapter 20 of the Texas Administrative Code, an amendment to §27.31 is necessary to comply with Texas Government Code §2161.003. Project Number 35351 is assigned to this proceeding.

Leticia Flores, General Counsel, has determined that for each year of the first five-year period the proposed section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section.

Ms. Flores has determined that for each year of the first five years the proposed section is in effect the public benefit anticipated as a result of enforcing the section will be a streamlined method for securing more goods and services from HUB vendors. There will be no effect on small businesses or micro-businesses as a result of enforcing this section, therefore, no regulatory flexibility analysis is necessary. There is no anticipated economic cost to persons who are required to comply with the section as proposed.

Ms. Flores has also determined that for each year of the first five years the proposed section is in effect there should be no effect on a local economy, and therefore no local employment impact statement is required under the Administrative Procedure Act §2001.022.

The commission staff will conduct a public hearing on this rulemaking, if requested pursuant to the Administrative Procedure Act, Texas Government Code §2001.029. The request for a public hearing must be received within 30 days after publication.

Comments on the proposed new rule (16 copies) may be submitted to the Filing Clerk, Public Utility Commission of Texas, 1701 North Congress Avenue, P.O. Box 13326, Austin, Texas 78711-3326, within 30 days after publication. Comments should be organized in a manner consistent with the organization of the proposed rule. All comments should refer to Project Number 35351.

This amendment is proposed under the Public Utility Regulatory Act, Texas Utilities Code Annotated §14.002 and §14.052 (Vernon 2007 and Supp. 2007) (PURA), which provides the Public Utility Commission with the authority to make and enforce rules reasonably required in the exercise of its powers and jurisdiction, including rules of practice and procedure; and Texas Government Code §2161.003, which requires the commission to adopt the Comptroller of Public Accounts rules for Historically Underutilized Businesses.

Cross Reference to Statutes: Public Utility Regulatory Act §14.002 and §14.052; Texas Government Code §2161.003.

§27.31.Historically Underutilized Business Program.

The commission adopts by reference the rules of the Comptroller of Public Accounts [ Texas General Services Commission ] in 34 [ 1 ] Texas Administrative Code (TAC) §§20.11, 20.13, 20.14, 20.26 and 20.27 [ §§111.11, 111.13, 111.14, 111.26, and 111.27 ], relating to the Historically Underutilized Business Program.

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 February 22, 2008.

TRD-200801074

Adriana A. Gonzales

Rules Coordinator

Public Utility Commission of Texas

Earliest possible date of adoption: April 6, 2008

For further information, please call: (512) 936-7223


Part 9. TEXAS LOTTERY COMMISSION

Chapter 402. CHARITABLE BINGO ADMINISTRATIVE RULES

Subchapter B. CONDUCT OF BINGO

16 TAC §402.210

The Texas Lottery Commission (Commission) proposes new Title 16, Part 9, Chapter 402, Subchapter B, §402.210 (relating to House Rules). The proposed new rule replaces withdrawn proposed new §402.210 (relating to House Rules) which was published in the Texas Register on October 5, 2007 (32 TexReg 6962).

The purpose of the proposed new rule is to set out the minimum requirements for house rules informing players in detail of how a licensed authorized organization will conduct its bingo games. Specifically, the new rule requires licensed authorized organizations to develop and adhere to its house rules and ensure that the house rules are consistently applied and made available to anyone upon request. The new rule also provides that the house rules shall not conflict with the Bingo Enabling Act or the Charitable Bingo Administrative Rules.

Kathy Pyka, Controller, has determined that, for each year of the first five years the proposed new rule would be in effect, there are no foreseeable implications related to cost or revenues of the state or local governments expected as a result of enforcing or administering the rule. Ms. Pyka has also determined that there would be no adverse economic effect on small businesses, micro businesses, or local or state employment. Furthermore, an Economic Impact Statement and Regulatory Flexibility Analysis is not required because the proposed new rule will not have an economic effect on small businesses as defined in Tex. Govt. Code, §2006.001(2). All entities subject to the proposed new rule are non-profit organizations.

Philip D. Sanderson, Director of the Charitable Bingo Operations Division, has determined that, for each year of the first five years the proposed new rule would be in effect, the public benefit anticipated is a rule that will provide interested parties with the rules adopted by the licensed authorized organization to explain in detail how the organization is going to conduct its bingo games. Mr. Sanderson has also determined that there would be no probable economic cost to persons required to comply with the rule.

The Commission requests comments on the proposed new rule from any interested person. Comments on the proposed new rule may be submitted to Sandra Joseph, Assistant General Counsel, by mail to Texas Lottery Commission, P.O. Box 16630, Austin, Texas 78761-6630; by facsimile at (512) 344-5189; or by e-mail to www.legal.input@lottery.state.tx.us. The Commission will hold a public hearing on this proposal at 10:00 a.m. on March 20, 2008, at 611 E. 6th Street, Austin, Texas 78701. Comments must be received within 30 days after publication of this proposal in order to be considered.

The new rule is proposed under the Texas Occupations Code, §2001.054, which authorizes the Commission to adopt rules to enforce and administer the Bingo Enabling Act. The new rule is also proposed under Texas Government Code, §467.102, which authorizes the Commission to adopt rules for the enforcement and administration of the laws under the Commission's jurisdiction.

The proposed new rule implements the Texas Occupations Code, Chapter 2001.

§402.210.House Rules.

(a) House rules are rules adopted by the licensed authorized organization that have been developed by its officers to inform players in detail of how the organization will conduct its bingo games.

(b) The licensed authorized organization shall develop house rules.

(c) The licensed authorized organization shall adhere to its house rules.

(d) The operator on duty is responsible for ensuring house rules are consistently applied.

(e) The house rules must be made available to anyone upon request.

(f) House rules shall not conflict with the Bingo Enabling Act or the Charitable Bingo Administrative Rules.

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 February 22, 2008.

TRD-200801070

Kimberly L. Kiplin

General Counsel

Texas Lottery Commission

Earliest possible date of adoption: April 6, 2008

For further information, please call: (512) 344-5012