PARt 1. COMPTROLLER OF PUBLIC ACCOUNTS
SUBCHAPTER F. MOTOR VEHICLE SALES TAX
The Comptroller of Public Accounts adopts amendments to §3.96, concerning imposition and collection of a surcharge on certain diesel-powered motor vehicles, without changes to the proposed text as published in the November 7, 2008, issue of the Texas Register (33 TexReg 9051).
The amendments implement a legislative change made by Senate Bill 867, 79th Legislature, 2005, which eliminated the imposition of the surcharge on recreational vehicles that are not held or used in the production of income. Subsection (a)(1) is amended accordingly. The amendments also implement a legislative change made by Senate Bill 12, 80th Legislature, 2007, which extended the expiration of the law under Tax Code, §152.0215 until August 31, 2013. Subsection (g) is amended accordingly.
No comments were received regarding adoption of the amendment.
This amendment is adopted under Tax Code, §111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of Tax Code, Title 2.
The amendment implements Tax Code, §152.0215.
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 January 6, 2009.
TRD-200900036
Martin Cherry
General Counsel
Comptroller of Public Accounts
Effective date: January 26, 2009
Proposal publication date: November 7, 2008
For further information, please call: (512) 475-0387
The Comptroller of Public Accounts adopts amendments to §3.320, relating to Texas emissions reduction plan surcharge; off-road, heavy-duty diesel equipment, without changes to the proposed text as published in the November 7, 2008, issue of the Texas Register (33 TexReg 9052).
The amendment to subsection (a)(1) reflects longstanding agency policy that the surcharge does not apply to certain equipment used directly in oil and gas exploration and production. The amendments to subsection (b)(1) - (4) implement a legislative change made by Senate Bill 12, 80th Legislature, 2007, which extended the expiration of the law under Tax Code, §151.0515 until September 1, 2013. Other changes to the section are for clarity.
No comments were received regarding adoption of the amendments.
The amendments are adopted under Tax Code, §111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of Tax Code, Title 2.
The amendment implements Tax Code, §151.0515.
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 January 6, 2009.
TRD-200900042
Martin Cherry
General Counsel
Comptroller of Public Accounts
Effective date: January 26, 2009
Proposal publication date: November 7, 2008
For further information, please call: (512) 475-0387
SUBCHAPTER A. PRACTICE AND PROCEDURE
The Comptroller of Public Accounts adopts the repeal of §9.109, concerning procedures for protesting preliminary findings of taxable value, without changes to the proposed text as published in the November 14, 2008, issue of the Texas Register (33 TexReg 9199). The section will be replaced by a new subchapter that breaks the current, lengthy rule into shorter, more manageable rules and sets out the items that must be included in a protest petition that adequately "specifies the grounds for objection" as required by Government Code, §430.303. The new rules would require the comptroller to refer protests that cannot be resolved without a hearing to the State Office of Administrative Hearings (SOAH). In addition to defining terms and addressing when a protest must by filed, the new rules address the scheduling order issued by a SOAH Administrative Law Judge (ALJ), the exchange of evidence by the parties after referral to SOAH, the conduct of the hearing by SOAH ALJ's, the ALJ's decision, the exceptions process, and the issuance of a final decision.
No comments were received regarding adoption of the repeal.
The repeal is adopted under Government Code, §403.303(c), which requires that the comptroller adopt rules governing protests of preliminary findings.
The adopted repeal affects Government Code, §403.303.
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 January 9, 2009.
TRD-200900086
Ashley Harden
Chief Deputy General Counsel
Comptroller of Public Accounts
Effective date: January 29, 2009
Proposal publication date: November 14, 2008
For further information, please call: (512) 475-0387
The Comptroller of Public Accounts adopts new §§9.4301 - 9.4313, concerning procedures for protesting preliminary findings of taxable value, with changes to the proposed text as published in the November 14, 2008, issue of the Texas Register (33 TexReg 9199). The new rules will replace §9.109, which sets out the current procedures for protesting the preliminary findings of taxable value. The new rule(s) were developed, in part, because the comptroller will refer hearings on protests of the preliminary findings to the State Office of Administrative Hearings (SOAH), beginning in 2008. The current rule did not provide for such a referral. New procedures were required to conform comptroller procedures with SOAH procedures and processes and ensure a smooth, efficient referral and a fair hearing. The rules clarify the language and evidence that must be included in a petition to sufficiently state the grounds for objection to preliminary findings. The current rule is difficult for the public to use because it is lengthy and covers several different, but related, topics. The new rules break the longer rule down into shorter rules that each address a specific topic. The new rules govern the entire protest process. Among the matters that are addressed are; how and when to file a petition, extensions of time, what constitutes good cause for submitting evidence after the deadline, the burden of proof, how and when a protest will be referred to SOAH for hearing, the notice of hearing, issuance of a scheduling order, the exchange of evidence after referral to SOAH, the administrative law judge's powers and duties, how the hearing will be conducted, evidentiary rules, notice of the administrative law judge's proposed decision, exceptions to the proposed decision, and when the decisions become final.
During the proposed period, several comments were received and considered by the comptroller.
Comments on §9.4307(e) were received from James F. Ramsey, Ed Kliewer III, George Scott Christian for the Texas Taxpayer and Research Association (TTARA), Robert Mott, and Vance Liston. The commenters objected to subsection (e), which concerns action by the agency on an insufficient protest petition. Under the proposed rule, the division manager may determine that a protest petition does not meet the statutory and administrative rule requirements that apply to a petition protesting the preliminary findings. The commenter's objection was that the division manager should not be given the authority to reject a petition for an insufficient statement of the protest grounds, which is defined as a specific statement of the reasons for each change sought by the petitioner and the documentary evidence that supports each requested change. The commenters suggested that the authority to determine the sufficiency of a petition should be vested in a third party, such as an administrative law judge or hearing examiner. One commenter stated that if the manager retained the authority to reject petitioner, an appeal to the comptroller or an administrative law judge should be permitted. (Presumably, the commenters refer to an Administrative Law Judge (ALJ) employed by SOAH.) The agency declined to make the suggested changes because it is not unprecedented for the authority to reject an appeal of an agency's actions or decision to reside with the agency whose actions or decisions are being appealed. To address the commenter's concerns, however, the agency changed the subsection (e) to provide more distance between the property value study and the individual making the decision. The rule provides for the comptroller or comptroller's designee to determine if a protest petition is sufficient and provides for exercise of discretion in making the decision.
James F. Ramsey, Vance Liston, and Ed Kliewar commented that the notice requirements in §9.4307(g) are vague and should be clarified. In addition, they objected to the requirement that the petitioners certify that notice has been delivered as required and suggested that the certification state that notice was mailed to the required parties. The agency agreed and clarified that a copy of the petition must be delivered to each affected party. The certification of delivery was changed to certification that a copy of the petition was mailed to each affected entity.
George Christian commented for TTARA that §9.4309(a) should be changed to make the referral to SOAH a ministerial, non-discretionary function. The comptroller declined to make the change because the comptroller by statute does not have the discretion to refuse to provide a hearing. Government Code, §403.303, gives school districts and taxpayers a right to a hearing on the entity's protest.
Robert Mott commented that the examples of a sufficient statement of grounds for the protest in §9.4307(f) should include a statement that they are advisory only and not binding on the ALJ. If this statement is not included, the commenter stated that the examples, particularly paragraphs (3) and (4), should be edited. The commenter stated that the example of documentary evidence in paragraph (3), in which the petitioner contends that a property was sold under duress, is not obtainable. The commenter stated that an executor would not swear that property was sold under duress because they "are liable for that kind of thing." The agency disagreed because agency appraisers have obtained these statements. The commenter objected also to the example in paragraph (4) of documentary evidence that personal property is included in the sale of real property. The example was a list, attached to the real property deed, of the items of personal property included in the sale price and the value of each. The commenter stated that this list is "virtually never done by real estate agents because they cannot get a commission on the sale of personal property." The comptroller does not agree that most real estate brokers misrepresent the basis on which their commissions are calculated, and did not make the change. The agency did not add the suggested language because the rule states that the paragraphs are examples, which is a self-explanatory term. Addition of the suggested language is therefore unnecessary, and would be redundant.
Robert Mott commented that §9.4305 should be changed to place the authority to determine if an extension of time should be granted with hearing examiners because the manager should not have this authority. The commenter noted that past hearing examiners have found for the petitioner over the division's objections. The agency declined to make the suggested change, but changed subsections (d) and (f) to provide for extensions of time to be granted or denied by the director of the Property Tax Assistance Division. This change addresses the commenter's concern that the division manager is too close to the Property Value Study to make a fair decision.
The commenter stated that §9.4310(c)(5) and (7) should be deleted from the grounds on which the ALJ may dismiss a petition. The commenter stated that dismissal for failure to certify that notice was delivered was a trap for small districts. The commenter stated that dismissal because amended preliminary findings were filed does not make sense and the ground should be deleted or made very narrow. The agency declined to make the suggested changes because the ALJ is not required to dismiss on these grounds, and were the division to make a motion to dismiss on any of the grounds listed, the subject party would have an opportunity to present its argument against dismissal. The commenter stated also that §9.4311(e), which defines the comptroller's burden of proof, should be deleted because it does not correctly state the comptroller's burden. The agency deleted the provision.
The comptroller corrected an error in §9.4308(c) by deleting the word "mediation." The inclusion of mediation in the subsection was inadvertent and appeared to provide both a settlement conference and mediation, instead of providing petitioners with a choice to request either mediation or an informal conference before proceeding to a hearing. A change in the name of the comptroller division that is charged with conducting the Property Value Study occurred after publication of the proposed rules. To accommodate the change, the comptroller added a definition of "division" to §9.4301 and renumbered all paragraphs that follow 9.43.01(5). Specific references to the division's name were deleted from §9.4303 and §§9.4305 - 9.4312.The comptroller also deleted an unnecessary sentence concerning the means by which the manager may provide written approval to file protests through electronic transmission from §9.4307(d)(4) and corrected a grammatical error in subsection (f)(4) changing "than" to "that."
The new rules are adopted under Government Code, §403.303, which requires the comptroller to adopt procedural rules governing the conduct of the protest hearing.
The new rules implement Government Code, §403.303, which concerns protests of the comptroller's preliminary certification of school district total taxable property value.
§9.4301.Definitions.
The following words and terms, when used in this subchapter, shall have the following meanings, unless the context clearly indicates otherwise.
(1) Agent--The individual that the petitioner is required to designate in the petition to perform the following activities on behalf of the petitioner:
(A) receive and act on all notices, orders, decisions, exceptions, replies to exceptions, and any other communications regarding the petitioner's protest;
(B) resolve any matter raised in petitioner's petition;
(C) argue and present evidence timely submitted with the petition at petitioner's protest hearing, unless agent designates in writing another individual to argue and present timely submitted evidence; and
(D) any other action required of petitioner.
(2) ALJ--An Administrative Law Judge employed by the State Office of Administrative Hearings.
(3) Appraisal district measures--The comptroller's measures of the degree of uniformity and median level of appraisal of an appraisal district made under Tax Code, §5.10.
(4) Decision--
(A) Proposed decision--A finding made by the ALJ concerning a protest of preliminary findings of taxable value, subject to filing of exceptions by any party.
(B) Final decision--An official finding adopted by the deputy comptroller.
(5) Division--The Comptroller of Public Accounts division that is charged with conducting the Property Value Study and the performance of other programmatic functions related to the administration of the state property.
(6) District--A school district. District does not include an appraisal district.
(7) Good cause--Appropriate justification other than a claim that the periods provided by these rules are too short.
(8) Person--Any individual, partnership, corporation, association, governmental subdivision, or public or private organization.
(9) Petition--The document and supporting evidence filed by petitioner indicating disagreement with the comptroller's preliminary findings or appraisal district measures.
(10) Petitioner--A school superintendent, chief appraiser or eligible property owner who submits a petition seeking redetermination of the comptroller's preliminary findings or appraisal district measures. Unless the context clearly indicates otherwise, in this subchapter, the term "petitioner" includes petitioner's agent.
(11) Preliminary findings--The comptroller's findings of district property value delivered to a district and certified to the commissioner of education under Government Code, §403.302(f) or (g).
(12) Protest--A disagreement by a district, property owner, or appraisal district with the comptroller's preliminary findings or appraisal district measures initiated by timely filing the petition required by §9.4307 of this title (relating to Filing a Protest).
(13) Ratio study--A study designed to evaluate appraisal performance through a comparison of appraised values made for tax purposes with independent estimates of market value based either on sales prices or independent appraisals.
(14) SOAH--The State Office of Administrative Hearings.
§9.4302.Intent, Scope, and Construction of Subchapter H.
(a) Intent and scope of Subchapter H. This subchapter is intended to provide a petitioner with an informal, clear process for resolving a disagreement with the Comptroller of Public Account's preliminary findings of property value, certified to the commissioner of education pursuant to Government Code, §403.302(f) and (g), and the measures of degree of uniformity and the median level of appraisal made as required by Tax Code, §5.10. This section governs all aspects of a preliminary findings or appraisal district measures protest.
(b) Construction of protest rule. Rules concerning protests of the preliminary findings of property value certified to the commissioner of education pursuant to Government Code, §403.302(f) or (g) and the measures of degree of uniformity and the median level of appraisals made pursuant to Tax Code, §5.10, will be reasonably construed in the rule's total context and in a manner that provides the parties with a reasonably informal protest process and hearing, and a fair decision for every protest.
(c) Unless otherwise provided, this subchapter shall be construed as provided by Code Construction Act, Government Code, Chapter 311.
§9.4303.General Provisions.
(a) In computing a period of time, the period begins on the day after the act or event in question and ends on the last day of the time period. If the last day of the time period is a Saturday, Sunday, or state or federal legal holiday, the period of time runs until the end of the first day that is neither a Saturday, Sunday, or state or federal legal holiday.
(b) A property owner may contact the division manager for information concerning the districts or appraisal districts that have filed a petition as required by this section. A district or appraisal district may contact the division manager for information concerning property owners that have filed a petition as required by this section.
§9.4304.Changes in Preliminary Certification.
(a) At any time before the date on which final changes in the preliminary findings are certified to the commissioner of education, the comptroller may certify to the commissioner of education amended preliminary findings.
(b) An amended preliminary finding is a change made by the comptroller to the district's preliminary findings that is certified to the commissioner of education and delivered to the district after the date on which preliminary findings for the district were originally certified and before the date on which final certification of changes in preliminary findings are certified.
(c) If the comptroller certifies amended preliminary findings that increase the district's total taxable value, the affected district, appraisal district, and property owners have a right to protest the findings in the manner required by this subchapter. The district's, appraisal district's, and property owner's time to protest begins to run on the date the amended preliminary findings are certified.
(d) An error in the comptroller's preliminary findings that was caused by an error in a district's annual report of property value or by a change in a district's certified tax roll may be corrected by timely filing a petition and otherwise complying with the requirements of this subchapter.
§9.4305.Extensions of Time.
(a) Before a hearing is referred to State Office of Administrative Hearings (SOAH), the division manager may, on the division's own motion, grant an extension of time for the limited purpose of correcting technical errors or omissions in a timely filed protest petition. Petitioner's failure to submit grounds for objection or all documentary evidence necessary to support the factual and legal contentions made in the petition is not a technical error or omission.
(b) At any time before a hearing is referred to SOAH, a petitioner may request an extension of time for any deadline by submitting a request for extension to the division manager.
(c) No more than one extension during an appeals period may be granted for each petitioner.
(d) An extension of time shall be requested in writing and submitted to the division director at least five days in advance of the original deadline for which the extension is requested. If requested in writing by the petitioner and for good cause shown, the division director may waive the requirement that the request for the extension be made five days in advance of the deadline.
(e) An extension may not extend the deadline for more than ten days.
(f) An extension may be granted by the division director only for good cause shown, and if the reason for the extension is not the petitioner's neglect, indifference, or lack of diligence. Good cause does not include a claim that the time periods established in this rule are too short to meet the deadline.
§9.4306.Who May Protest.
(a) A district may protest the preliminary findings of its taxable value.
(b) A district may protest the preliminary findings of taxable value of an audit within the district.
(c) An owner of property included in a sample used by the comptroller to determine the taxable value of a category of property in a district may protest the comptroller's preliminary findings of value if the total ad valorem tax liability on the owner's properties included in the category sample for the district is $100,000 or more.
(d) An appraisal district may protest the comptroller's measures, made under Tax Code, §5.10, of the level and uniformity of property appraisals within the district.
(e) A protest filed by a property owner or an appraisal district will not be considered for any purposes to be a protest filed by a district.
(f) A petition must be signed by:
(1) the superintendent of the district, if it is a petition filed by a school district; or
(2) the property owner or the property owner's agent, if it is a petition filed by a property owner; or
(3) the chief appraiser of the appraisal district, if it is a petition filed by an appraisal district.
§9.4307.Filing a Protest.
(a) A petition for a protest of the preliminary findings of taxable value or measures of degree of uniformity or median level of appraisal must be filed within 40 days after the date the comptroller certifies preliminary findings of district taxable value to the commissioner of education.
(b) A petition for a protest of the preliminary findings of taxable value of an audit must be filed within 40 days of the date the district received the preliminary findings of taxable value.
(c) Except as provided by §9.4309(b)(5) or (f) of this title (relating to Scheduling a Protest Hearing), no additional evidence may be submitted after the deadline for filing a petition under subsection (a) or (b) of this section.
(d) All petitions and other documents related to a protest of the comptroller's preliminary findings or appraisal district measures shall be filed with the division manager. No document or petition is filed until actually received. However, any petition including supporting evidence is timely filed if it is sent to the division manager by:
(1) first-class United States mail in a properly addressed and stamped envelope or wrapper, and the envelope or wrapper exhibits a legible postmark affixed by the United States Postal Service showing that the petition including supporting evidence was mailed on or before the last day for filing; or
(2) an express mail corporation in a properly addressed envelope or wrapper, and the envelope or wrapper exhibits a legible date showing that the petition including supporting evidence was delivered to the express mail corporation for delivery on or before the last day for filing; or
(3) fax received on or before the last day for filing if the petition including supporting evidence, is under ten pages in content, the original is mailed within three days of the fax and all procedures for submitting a protest have been followed; or
(4) electronic transmission, if petitioner obtains written permission from the division manager before the petition, evidence or both, are filed, or the division manager has approved the file format and form of transmission before the protest is filed.
(e) A petition shall show the petitioner's name and address, designate the petitioner's agent, and list for each category of property the grounds for objection to the preliminary findings for that category. Petitioner shall state the grounds for objection in the manner required by subsection (f) of this section. A petition that does not clearly specify, in the manner provided by subsection (f) of this section, the specific changes that petitioner alleges would improve the accuracy of the taxable finding or appraisal district measures does not adequately specify the grounds for objection as required by Government Code, §403.303(a) and may be rejected by the comptroller or the comptroller's designee without further review. The petition shall include the following information:
(1) the petitioner's grounds for objection, stated with the specificity and in the manner required by subsection (f) of this section;
(2) all documentary evidence, placed in order by category and item number, necessary to support the factual and legal contentions made in the petition; and
(3) the total taxable value petitioner claims is correct.
(f) The comptroller has been provided sufficient grounds for objection if the petitioner's protest lists, by property category, each change that the petitioner alleges would improve the accuracy of the taxable value finding or appraisal district measures, and provides the reason that each change will make the findings more accurate. An allegation that an item included the sample for a category of property should be adjusted, deleted from the sample, or treated differently than other items in the sample provides sufficient notice of the grounds for objection if the petitioner: identifies the sample item that petitioner alleges should be adjusted, deleted or treated differently; states for each item a specific reason or reasons why the item should be treated as requested by petitioner, and provides documentation or other evidence that supports the substance of each allegation. Without supporting documentation or other evidence to support the allegation, an allegation that a sample item is flawed and should be adjusted, deleted, or treated differently than the other items in the sample does not provide sufficient notice to the comptroller of the grounds for the petitioner's objection. The following are examples of sufficient grounds for objection:
(1) Sale A should be deleted. It is not an arms-length transaction because the buyer and seller are closely related. Included with the petition is a copy of a deed filed with the county clerk that indicates that the seller is related to the buyer and a statement from the buyer that she is the seller's daughter.
(2) Sale B should be deleted. It is not an arms-length transaction because it was made under duress. The sale is a "1031 exchange," which is a sale of real property in which either the buyers or sellers obtained or attempted to obtain the federal income tax benefit authorized by 26 U.S. C. §1031. The buyer did not start to search for an appropriate property until the month before the deadline for making the exchange. The buyer was under duress because she had to meet the deadline, so she paid more than market value for the property. Included with the petition is the buyer's signed statements that she bought the property when she did to avoid paying capital gains taxes and paid a higher price that she would have if she had not needed to buy the property quickly.
(3) Sale C should be adjusted because it sold with personal property. The sale price for the real property was actually $190,000 because the buyers purchased the seller's commercial kitchen appliances and fitness equipment that included a commercial quality treadmill and recumbent bicycle. The personal property is listed and valued in an attachment to the deed. Included with the petition is the deed and the attachment verifying the personal property included in the sale and its value at the time of sale.
(4) Sale D should be deleted because it is an estate sale and the sellers were forced to sell the property without regard to market value because the estate's debts had to be paid. Attached with the protest is a deed that shows it to be an estate sale and a statement from the seller that the estate's debts forced the seller to sell the property to the first willing buyer less than a month after the owner's death.
(g) A district shall deliver a copy of its protest petition to each appraisal district that appraises property for the district. An appraisal district shall deliver a copy of its protest petition to each district that participates in the appraisal district. A property owner shall deliver a copy of its protest petition to each school district and appraisal district in which the property under protest is located. The district's, appraisal district's, and property owner's petition shall contain a certification that a copy of the petition was mailed to each affected party as required by this subsection.
(h) The petition must contain a statement by the person signing the petition that, to the best of the person's knowledge, the evidence contained in the petition is true and correct.
§9.4308.Prehearing Matters.
(a) After reviewing a protest, the division will send petitioner's agent a recommendation and a form on which the petitioner may indicate agreement or disagreement with the division's recommendation, and request an informal settlement conference, non-binding mediation with a mediator designated by the comptroller, or a hearing before a State Office of Administrative Hearings (SOAH) Administrative Law Judge (ALJ).
(b) If the petitioner requests an informal settlement conference or mediation, the division will schedule a time for the informal settlement conference or mediation. The division will then notify the petitioner of the date, time, and place of the settlement conference or mediation.
(c) If a petitioner and the division are unable to resolve all of the issues raised in a petitioner's protest through an informal settlement conference, the petitioner will be given the opportunity to request a hearing before a SOAH ALJ.
(d) If a petitioner requests mediation, both parties to the mediation will appear before a mediator selected by the comptroller, who will listen to the evidence and argument presented by the parties. Any agreements reached as a result of the mediation must be documented in writing signed by all affected parties. If the parties are unable to resolve all issues raised in the petition through mediation, either party may request a hearing.
(e) Each party shall bear its own costs for participating in the mediation. If a non-comptroller employee is designated as a mediator, costs of the mediator's time and expenses shall be borne equally by all the parties.
§9.4309.Scheduling a Protest Hearing.
(a) Referral of a protest to State Office of Administrative Hearings (SOAH) may be made only by the division. The referral is initiated by filing with SOAH a request for setting of hearing that requests that the hearing be conducted on a date certain. At the time the referral is initiated, the division shall also provide to SOAH:
(1) a copy of the petition;
(2) notice of any related hearings that should be consolidated; and
(3) an accurate service list.
(b) Following receipt of the request for assignment of Administrative Law Judge (ALJ) form, SOAH shall assign the case a docket number, assign an ALJ, and issue a scheduling order for the case that:
(1) notifies all parties in writing of the ALJ assigned to the case;
(2) schedules a hearing on the protest to be held not later than 45 days after the date of the referral;
(3) requires the division, no later than 20 days before the date of the hearing, to file with the ALJ and provide petitioner with a copy of:
(A) all documentary evidence that the division intends to offer in response to the evidence petitioner filed with the petition;
(B) a witness list, and
(C) a summary of the testimony that each witness will provide at the hearing;
(4) requires the petitioner, no later than 10 days before the date of the hearing, to file with the ALJ and provide the division with a copy of:
(A) all documentary evidence that the petitioner intends to offer in response to the documentary evidence filed by the division,
(B) a witness list, and
(C) a summary of the testimony that each witness will provide at the hearing;
(5) provides that no party may offer evidence at the hearing that was not provided as required by the scheduling order unless the party shows good cause why the evidence was not provided in accordance with the scheduling order.
(c) Hearings shall be held at a location designated by SOAH.
(d) Following receipt of the scheduling order, the comptroller shall deliver notice of the date, time, and place fixed for a hearing to each petitioner. The notice must be delivered not later than ten days before the date of the hearing.
(e) Not less than five days before a scheduled protest hearing, the division or a petitioner may request a preliminary conference with the SOAH ALJ to clarify the issues for the hearing or resolve the protest. If the request is made, a conference call shall be scheduled during business hours at a time mutually agreeable to the ALJ, the division, and the petitioner. Admissions, proposals, or offers made in the compromise of disputed issues in a preliminary conference may not be admitted in a hearing.
(f) At a preliminary conference or at any other time before a scheduled hearing, either party may request that the ALJ issue an amended scheduling order. Any amended scheduling order shall provide that no party may offer evidence at the hearing that was not provided as required by the amended scheduling order unless the party shows good cause why the evidence was not provided in accordance with the amended scheduling order.
§9.4310.Administrative Law Judges Powers.
(a) The Administrative Law Judge (ALJ) shall conduct a protest hearing in a manner insuring fairness, the reliability of evidence, and the timely completion of the hearing. The ALJ shall have the authority necessary to receive and consider all evidence and propose decisions. The ALJ's authority includes, but is not limited to, the following:
(1) establish the comptroller's jurisdiction concerning the protest, including whether a timely protest has been filed or whether an extension of time should be granted;
(2) set hearing dates;
(3) rule on motions and the admissibility of evidence;
(4) designate parties and establish the order of presentation of evidence, except that the division, which is the party with the burden of proof, shall always have the right to present its evidence and argument on any issue prior to the parties protesting that issue;
(5) consolidate related protests;
(6) conduct a single hearing that provides for:
(A) participation by the affected district(s), appraisal district, and any property owner that has filed a valid and timely petition, if the hearing concerns preliminary findings of taxable value or the degree of uniformity and median level of appraisal; or
(B) participation by the affected district(s) and the commissioner of education, if the hearing concerns the preliminary findings of an audit of a district's taxable property value.
(7) conduct hearings in an orderly manner and expel from any proceeding any individuals who, after an appropriate warning, fail to comport themselves in a manner befitting the proceeding and continue with the proceeding, hear evidence, and render a decision on the protest;
(8) administer oaths to all persons presenting testimony;
(9) examine witnesses and comment on the evidence;
(10) insure that evidence, argument, and testimony are introduced and presented expeditiously;
(11) refuse to hear arguments that are repetitious, not confined to matters raised in the petition, not related to the evidence or that constitute mere personal criticism;
(12) accept and note any petitioner's waiver of any right granted by this rule;
(13) limit each hearing to two hours for presentation of evidence and argument or extend the two-hour time limit in the interest of a full and fair hearing; and
(14) exercise any other powers necessary or convenient to carry out the ALJ's responsibilities and to insure timely certification of changes in preliminary findings to the commissioner of education.
(b) The ALJ may take official notice of any matter that trial judges may judicially notice. Petitioners in a protest in which official notice is taken shall have an opportunity to contest the matter.
(c) The ALJ may entertain motions for dismissal at any time for any of the following reasons:
(1) failure to prosecute;
(2) unnecessary duplication of proceedings or res judicata;
(3) withdrawal of protest;
(4) moot questions or obsolete petition;
(5) failure to certify that notice of protest was filed as required by §9.4307 of this title (relating to Filing a Protest), or failure to actually file notice as required by §9.4307 of this title;
(6) an appraisal district's protest would result in an increase to a school district's preliminary findings of total taxable value; or
(7) the comptroller has certified amended preliminary findings as allowed by §9.4307 of this title.
(d) The ALJ may grant a request to postpone a protest hearing if good cause is shown and doing so would not prevent timely certification of changes in the preliminary findings to the commissioner of education. A request to postpone must be in writing, show good cause for the postponement, and be delivered five days before the date the protest hearing is scheduled to begin. Good cause does not include a claim that the time periods established in this rule are too short to meet the deadline. If requested in writing by the petitioner and for good cause shown, the ALJ may waive the requirement that the request for postponement be made five days in advance of the deadline.
(e) The ALJ shall determine the admissibility of the evidence. Any party may object to the admission of evidence and the objection will be ruled on and noted on the record. The ALJ may exclude irrelevant, immaterial, or unduly repetitious evidence. The ALJ may receive any part of the evidence in writing.
(f) The ALJ in a protest may not communicate outside a protest hearing, directly or indirectly, with any agency, person, petitioner or petitioner's agent regarding any issue of fact or law relating to the protest unless all parties in the protest have notice and opportunity to participate.
§9.4311.Conduct of Hearing.
(a) The Administrative Law Judge (ALJ) shall convene a hearing for a protest.
(b) All protests heard by the ALJ shall be recorded. A petitioner will be provided a copy of the recording after a written request and payment of a cost-based fee. A petitioner may at any time make arrangements for and bear the cost of having a hearing recorded and transcribed by a court reporter, provided the division and the ALJ timely receive a copy of the transcript.
(c) All proceedings are open to the public and are held in Austin, unless the ALJ designates another place for the hearing. The ALJ may close a hearing, on the ALJ's own motion or on the motion of any party, if confidential information may be disclosed during the hearing.
(d) Hearings shall be conducted in accordance with this section. The Texas Administrative Procedures Act does not apply.
(e) Each petitioner may present oral or written argument on any matter raised by the petition. Argument shall be confined to the evidence and to arguments of other parties. Admissions, proposals, or offers made in the compromise of disputed issues in a preliminary conference may not be admitted in a hearing.
(f) Unless the ALJ permits multiple representatives to be heard in a protest hearing, no more than one representative for each party or aligned group of parties shall be heard in the hearing on any petition. An agent may designate, and the ALJ may approve, a reasonable number of individuals to present argument and timely submitted evidence. Nothing in this subsection limits the presentation of evidence through witness testimony.
(g) The ALJ shall establish the order of proceeding (except as noted in subsection (d) of this section), and is responsible for closing the record.
(h) An attorney who appears in a protest hearing must comply with §3.08 of the Texas Disciplinary Rules of Professional Conduct.
§9.4312.Proposed Decision, Exceptions.
(a) The Administrative Law Judge (ALJ) shall prepare a proposed decision that includes a statement of the reasons for the proposed decision.
(b) The ALJ shall serve the proposed decision on the deputy comptroller, the petitioner, and the division manager by facsimile machine, if available, by electronic mail, or by using an overnight mail delivery service.
(c) A party adversely affected by the proposed decision may, within ten days after the date the proposed decision is sent by facsimile machine, electronic mail, or delivered to an overnight delivery service, file exceptions by delivering the original documents to the ALJ.
(d) Replies to exceptions shall be filed in the same manner within 20 days after the proposal for decision is sent by facsimile machine, electronic mail, or delivered to an overnight delivery service.
(e) A copy of each exception and reply shall be served promptly on all other parties to the protest. Certification of service indicating that the exceptions were served on all other parties to the protest shall be furnished to the ALJ. On the motion of a party or on the motion of the ALJ, the ALJ may withhold consideration of a party's written exceptions if the party fails to:
(1) provide the copies required by this subsection to all other parties to the protest; or
(2) provide the ALJ with the certification of service required by this subsection.
(f) The ALJ may, on the ALJ's own motion or for good cause shown, extend or shorten the time in which to file exceptions or replies.
(g) The parties shall direct motions for extension of time in which to file exceptions or replies, or both, to the ALJ. A party's motion for extension of time shall be filed no later than five days before the applicable deadline for submission of exceptions or replies and shall demonstrate either:
(1) good cause for the requested extension; or
(2) agreement of all other parties to the extension.
(h) The ALJ shall review all exceptions and replies and notify the referring agency, within 15 days of the deadline for filing a reply to the exceptions, whether the ALJ recommends changes to the proposed decision.
§9.4313.Final Decision.
(a) A proposed decision is final, in either its original or amended form, on the date signed by the deputy comptroller.
(b) A final decision ordering changes to preliminary findings made as a result of a school district's protest will change the preliminary findings for the appraisal district in which the school district is located.
(c) A final decision ordering changes to preliminary findings made as a result of an appraisal district's protest will change the preliminary findings for the school districts participating in the appraisal district.
(d) A final decision ordering changes to preliminary values made as a result of a property owner's or district's protest will change the measures for an appraisal district.
(e) A final decision ordering changes to preliminary findings made as a result of a property owner's protest will change the preliminary findings for the school district where the property which is the subject of the protest is located. A property owner's preliminary value may be changed by a protest brought by a school district or appraisal district.
(f) The comptroller shall deliver written notice of the final decision to each protesting petitioner.
(g) Certification of changes to preliminary findings. Unless the comptroller determines that circumstances require otherwise, the comptroller shall certify to the commissioner of education all changes to the preliminary findings on or before August 15 of the year following the year of the study.
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 January 9, 2009.
TRD-200900087
Ashley Harden
Chief Deputy General Counsel
Comptroller of Public Accounts
Effective date: January 29, 2009
Proposal publication date: November 14, 2008
For further information, please call: (512) 475-0387
CHAPTER 302. GENERAL PROVISIONS RELATING TO THE TEXAS EMERGENCY SERVICES RETIREMENT SYSTEM
The State Board of Trustees of the Texas Emergency Services Retirement System (System) adopts amendments to 34 TAC §302.5, regarding correction of errors in membership or qualified service in the System, with changes to the text as published in the July 11, 2008, issue of the Texas Register (33 TexReg 5508). The rule as adopted adds a requirement that the form for correction of errors be provided by the System.
Amended rule §302.5 simplifies the procedure for the correction of errors in enrolling members or granting service credit by eliminating the requirements of a formal letter and a copy of meeting minutes of a local board showing the change and substituting submission of a prescribed form. The commissioner has the authority to require additional information on a case-by-case basis.
Two comments were received on the proposed rule, both of which questioned whether the Commissioner needed the authority to require further documentation of an error. Because the State Board of Trustees determines that flexibility in proving errors is an essential element in individual cases, the State Board respectfully disagrees with the comments and retains the provision to require additional documentation.
This agency hereby certifies that the amended rule has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.
The amended rule is adopted under the statutory authority of Title 8, Government Code, Subtitle H, Texas Emergency Services Retirement System. No other statutes, articles, or codes are affected by the amended rule.
§302.5.Correction of Errors.
(a) A local board may correct an error in enrollment in membership or computation of qualified service by completing and submitting to the commissioner a form provided by the pension system. The completed form must be:
(1) signed by the chair and secretary of the local board and the administrative head of the department; and
(2) accompanied by any applicable past due contributions necessitated by the change.
(b) The Commissioner may require the local board to provide additional documentation.
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 January 12, 2009.
TRD-200900107
Craig Hudgins
General Counsel
Office of the Fire Fighters' Pension Commissioner
Effective date: February 1, 2009
Proposal publication date: July 11, 2008
For further information, please call: (512) 463-9935
The State Board of Trustees of the Texas Emergency Services Retirement System (System) adopts amendments to 34 TAC §310.10, regarding voluntary payments by departments participating in the System to provide benefit enhancements for annuitants with changes to the text as published in the July 11, 2008, issue of the Texas Register (33 TexReg 5508). The rule as adopted differs very slightly from the proposed rule as published by removing confusing references to "one-time" increases.
The amended rule specifies five kinds of post-retirement increases that a department participating in the System may make to annuitants' benefits: an additional one-time payment, a cost-of-living adjustment based on an annual increase in the consumer price index, an annuity increase to a minimum monthly amount, an annuity increase of a specified amount for each year of service, or a percentage increase other than a cost-of-living adjustment. The amended rule allows a department to apply an increase to only fully vested annuitants if it so chooses.
Four comments were received on the proposed rule, two of which questioned whether the rule was too restrictive in specifying post-retirement increases and two of which asked for more clarification. Because departments have had no guidance in the past in adopting post-retirement increases, the State Board of Trustees respectfully disagrees with the comments and determines, in adopting the rule, that departments and their annuitants will be better served than before adoption of the amended rule.
This agency hereby certifies that the amended rule has been reviewed by legal counsel and found to be within the agency's legal authority to adopt and further certifies that the amended rule has been reviewed by the System's retained actuaries and found to be cost neutral.
The amended rule is adopted under the statutory authority of Title 8, Texas Government Code, Subtitle H, Texas Emergency Services Retirement System, §864.0135, which specifically authorizes the State Board of Trustees to adopt such a rule. No other statutes, articles, or codes are affected by the amended rule.
§310.10.Voluntary Payments by Departments.
(a) A participating department, as authorized by this section, may make one or more supplemental payments to retirees and other beneficiaries of the pension system, or may provide an increase in the amount of annuities paid to retirees and other beneficiaries of the system. A department may choose to apply a supplemental payment or increase in annuities to all beneficiaries as of the date of the payment or increase or to only those whose benefits are derived from a person who was eligible to retire under §308.1(a) of this title (relating to Eligibility for Retirement Annuity) or with a specified greater number of years of qualified service.
(b) An increase in benefits may consist of:
(1) an additional payment that does not exceed 100 percent of an annuitant's monthly scheduled payment;
(2) an annuity increase based on the 12-month increase in the Consumer Price Index for All Urban Consumers as of December of the preceding year;
(3) an increase to allow each annuity to reach a minimum monthly amount;
(4) an increase that adds to each annuity a specified amount for each whole year of credited service for the department; or
(5) a percentage increase to each annuity.
(c) Before it may implement a supplemental payment or annuity increase under this section, a participating department shall:
(1) obtain from the commissioner a determination from the system's actuary that the department's payments to the pension system will be sufficient to finance the anticipated additional benefits; and
(2) contract with the commissioner to make quarterly payments to the system that are necessary to finance the increase in benefits.
(d) A supplemental payment or increase in benefits must apply to all annuitants in the same classification but may be based on persons who qualified for an annuity under a previously lower contribution rate.
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 January 12, 2009.
TRD-200900106
Craig Hudgins
General Counsel
Office of the Fire Fighters' Pension Commissioner
Effective date: February 1, 2009
Proposal publication date: July 11, 2008
For further information, please call: (512) 463-9935