Proposed Rules Title 16

TITLE 16. ECONOMIC REGULATION

PART 4. TEXAS DEPARTMENT OF LICENSING AND REGULATION

CHAPTER 58. RENTAL PURCHASE AGREEMENTS

16 TAC §§58.1, 58.10, 58.21, 58.70, 58.80, 58.90

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Department of Licensing and Regulation or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The Texas Department of Licensing and Regulation ("Department") proposes the repeal of existing rules at 16 Texas Administrative Code ("TAC") Chapter 58, §§58.1, 58.10, 58.21, 58.70, 58.80, and 58.90 regarding rental-purchase agreements.

The current rules at 16 TAC Chapter 58 implement the current statutory requirements under Texas Business and Commerce Code, Chapter 35, Subchapter F. However, as the result of a rule review conducted in accordance with Texas Government Code §2001.039 (see the October 19, 2007, issue of the Texas Register (32 TexReg 7511)) and House Bill 2278, passed by the 80th Legislature, which recodified the Texas Business and Commerce Code, Chapter 35, Subchapter F, to Texas Business and Commerce Code, Chapter 92, effective April 1, 2009, the Department is proposing that the current rules, 16 TAC Chapter 58, be repealed and replaced with new 16 TAC Chapter 81 proposed in this issue of the Texas Register.

The Department has determined that the repeal is necessary to update statutory citations as a result of House Bill 2278 and to reflect current Department procedures regarding restructuring of administrative rule chapters.

William H. Kuntz, Jr., Executive Director, has determined that for the first five-year period the proposed repeal is in effect there will be no cost to state or local government as a result of enforcing or administering the repeal.

Mr. Kuntz also has determined that for each year of the first five-year period the repeal is in effect, the public benefit will be rules that reflect the current policies and procedures of the Department.

Mr. Kuntz has determined that there are no anticipated economic costs to small or micro-businesses or to persons who are required to comply with the repeal as proposed.

Since the agency has determined that the repeal will have no adverse economic effect on small or micro-businesses, preparation of an Economic Impact Statement and a Regulatory Flexibility Analysis, as detailed under Texas Government Code §2006.002, are not required.

Comments on the proposal may be submitted by mail to Caroline Jackson, Legal Assistant, Texas Department of Licensing and Regulation, P.O. Box 12157, Austin, Texas 78711, or by facsimile to (512) 475-3032, or electronically to erule.comments@license.state.tx.us. The deadline for comments is 30 days after publication in the Texas Register.

The repeal is proposed as the result of a rule review conducted in accordance with Texas Government Code §2001.039. The repeal is proposed under Texas Occupations Code, §51.201(b) and §51.203, which authorize the Commission, the Department's governing body, to adopt rules as necessary to implement Chapter 51 and any other law establishing a program regulated by the Department and Texas Business and Commerce Code, Chapter 35, Subchapter F.

The statutory provisions affected by the proposed repeal are those set forth in Texas Occupations Code, Chapter 51, the Commission's and Department's enabling statute and pursuant to House Bill 2278, passed by the 80th Legislature, which recodified the Texas Business and Commerce Code, Chapter 35, Subchapter F, to Texas Business and Commerce Code, Chapter 92, effective April 1, 2009. No other statutes, articles, or codes are affected by the proposed repeal.

§58.1.Authority.

§58.10.Definitions.

§58.21.Review Requirements-Rental Agreements.

§58.70.Responsibilities of Merchants.

§58.80.Fees.

§58.90.Administrative Penalties and Sanctions.

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 March 16, 2009.

TRD-200901098

William H. Kuntz, Jr.

Executive Director

Texas Department of Licensing and Regulation

Earliest possible date of adoption: April 26, 2009

For further information, please call: (512) 463-7348

CHAPTER 81. RENTAL PURCHASE AGREEMENTS

16 TAC §§81.1, 81.10, 81.21, 81.70, 81.80, 81.90

The Texas Department of Licensing and Regulation ("Department") proposes new rules at 16 Texas Administrative Code ("TAC") Chapter 81, §§81.1, 81.10, 81.21, 81.70, 81.80, and 81.90 regarding rental-purchase agreements.

As the result of a rule review conducted in accordance with Texas Government Code §2001.039 (see the October 19, 2007, issue of the Texas Register (32 TexReg 7511)) and House Bill 2278, passed by the 80th Legislature, which recodified the Texas Business and Commerce Code, Chapter 35, Subchapter F, to Texas Business and Commerce Code, Chapter 92, effective April 1, 2009, the Department is proposing new rules at 16 TAC Chapter 81.

The Department has determined that the new rules are are necessary to update statutory citations, clarify statutory and administrative rule requirements, and reflect current Department procedures.

William H. Kuntz, Jr., Executive Director, has determined that for the first five-year period the new rules are in effect there will be no cost to state or local government as a result of enforcing or administering the new rules because the rules did not substantively change.

Mr. Kuntz also has determined that for each year of the first five-year period the new rules are in effect, the public benefit will be rules that reflect the current policies and procedures of the Department.

Mr. Kuntz has determined that there are no anticipated economic costs to small or micro-businesses or to persons who are required to comply with the new rules as proposed because the rules did not substantively change.

Since the agency has determined that the rules will have no adverse economic effect on small or micro-businesses, preparation of an Economic Impact Statement and a Regulatory Flexibility Analysis, as detailed under Texas Government Code §2006.002, are not required.

The new rules are proposed as the result of a rule review conducted in accordance with Texas Government Code §2001.039. The new rules are proposed under Texas Occupations Code, §51.201(b) and §51.203, which authorize the Commission, the Department's governing body, to adopt rules as necessary to implement Chapter 51 and any other law establishing a program regulated by the Department. In addition, the new rules are proposed in accordance with Texas Business and Commerce Code, Chapter 35, Subchapter F.

The statutory provisions affected by the proposed new rules are those set forth in Texas Occupations Code, Chapter 51, the Commission's and Department's enabling statute and pursuant to House Bill 2278, passed by the 80th Legislature, which recodified the Texas Business and Commerce Code, Chapter 35, Subchapter F, to Texas Business and Commerce Code, Chapter 92, effective April 1, 2009. No other statutes, articles, or codes are affected by the proposed new rules.

§81.1.Authority.

These rules are promulgated under the authority of Texas Business and Commerce Code, Chapter 92, and Texas Occupations Code, Chapter 51.

§81.10.Definitions.

The following words and terms, when used in this chapter, have the following meanings.

(1) Rental Agreement--A rental-purchase agreement as defined in Texas Business and Commerce Code, §92.001(8) that includes a loss damage waiver, either as an integral part or as an attachment.

(2) Merchant--A person who, in the ordinary course of business, regularly leases, offers to lease, or arranges for the leasing of merchandise under a rental-purchase agreement, and includes a person who is assigned an interest in a rental-purchase agreement.

§81.21.Review Requirements--Rental Agreements.

(a) Merchants must submit all rental agreements for review and may not use or offer the rental agreement in Texas until notified by the Department.

(b) Each rental agreement submitted to the Department for review must:

(1) be accompanied by a review fee;

(2) be accompanied by a rental purchase agreement review application; and

(3) include the entire rental agreement including any addenda or attachments.

(c) If the rental agreement is amended after the department's initial or annual approval, merchants must submit the amended rental agreement for approval before using or offering the rental agreement in Texas.

(d) Merchants must submit all rental agreements for review annually. After the period of approval for the rental agreement has expired a merchant may not use or offer the rental agreement in Texas.

§81.70.Responsibilities of Merchants.

(a) A merchant must include the following written notification in all rental agreements: "For more information regarding the approval of loss damage waivers visit www.license.state.tx.us. You may also direct inquiries to the Texas Department of Licensing and Regulation, P.O. Box 12157, Austin, Texas 78711, 1-800-803-9202, 512-463-6599."

(b) The department issued rental agreement approval number must be listed on each rental agreement.

(c) A merchant shall allow the department to audit, examine, and copy any and all records maintained by the merchant pursuant to or relating to rental agreements as defined in §81.10 of this chapter.

§81.80.Fees.

(a) Original application fee is $300.

(b) Annual review fee is $300.

(d) All fees are non-refundable.

§81.90.Administrative Penalties and Sanctions.

If a person violates any provision of Texas Business and Commerce Code, Chapter 92, Subchapter D, any provision of Title 16, Texas Administrative Code, Chapter 81, or any provision of an order of the Executive Director or Commission, proceedings may be instituted to impose administrative penalties, administrative sanctions, or both administrative penalties and sanctions in accordance with the provisions of Texas Business and Commerce Code, Chapter 92; Texas Occupations Code, Chapter 51 and applicable rules.