Emergency Sections
An agency may adopt a new or amended section or repeal an existing section on an 
emergency basis if it determines that such action is necessary for the public 
health, safety, or welfare of this state. The section may become effective 
immediately upon filing with the Texas Register, or on a stated date less than 
20 days after filing, for no more than 120 days. The emergency action is 
renewable once for no more than 60 days.
Symbology in amended emergency sections. New language added to an existing 
section is indicated by the use of bold text. [Brackets] indicate deletion of 
existing material within a section.
TITLE 1. ADMINISTRATION
Part IV. Office of the Secretary of State
Chapter 71. Office of the Secretary of State
Practice and Procedure
1 TAC sec.sec.71.4, 71.6-71.10, 71.12
The Office of the Secretary of State adopts on an emergency basis amendments to 
sec.sec.71.4, 71.7-71.10, and new  s71.6 and sec.71.12, concerning faxed filings 
and the credit card payment option for documents filed with the secretary of 
state.
House Bill 278 added Texas Miscellaneous Corporation Laws Act Article 1302-7. 
07, sec.13.04 and Texas Revised Limited Partnership Act, Article 6132a-1, 
effective August 26, 1991, eliminating the requirement for original signatures 
on corporate and limited partnership documents by authorizing the filing of 
documents with facsimile signatures. In addition, as authorized by House Bill 
278, document filings electronically submitted by transmission over a facsimile 
(FAX) machine to the Office of the Secretary of State will be accepted for 
filing in the same manner as other documents submitted in person or by common 
courier, which require the simultaneous submission of the document and receipt 
of the filing fee.
The acceptance of electronically transmitted documents directly to the Office of 
the Secretary of State also necessitates the implementation of alternate payment 
methods of filing fees, namely the acceptance of credit cards or a debit system 
account maintained with a financial institution on contract to the Office of the 
Secretary of State and the Texas State Treasury Department. House Bill 11 
amended the Government Code, sec.405.031(e) to authorize the secretary of state 
to assess a credit card transaction charge in an amount that is reasonable and 
necessary to reimburse the secretary of state for the costs involved in the use 
of a credit card payment option.
Electronic document submission also necessitates clarification of the rule 
concerning receipt of letters and papers. Although documents may be 
electronically transmitted to the Office of the Secretary of State on a 24-hour 
basis, an employee of the secretary of state may stamp a document "received" 
only during regular business hours. The relevant date of receipt of an 
electronically submitted document is the day that the document is stamped 
"received" by an employee of the secretary of state. Therefore, for purposes of 
submission, any document electronically transmitted on a Saturday, Sunday, state 
holiday or after business hours of 8 a.m. to 5 p.m. will be deemed "received" on 
the next business day or when actually received by an employee of the secretary 
of state.
Finally, the expedited handling of document procedures are clarified to provide 
that notification of the completion of the expedited handling services will be 
given by the close of the next business day following the date of receipt of 
documents. This clarification is necessary because the entire expedited 
processing service, including the notification, cannot be completed on the same 
day of receipt for documents delivered at the end of the business day.
It is necessary to adopt these sections as an emergency to protect the welfare 
of those members of the public who may be filing documents pursuant to House 
Bill 278 immediately upon its effective date, but prior to the effective date of 
the proposed rules necessary to properly administer the new Act.
The amendments and new section are adopted on an emergency basis under the Texas 
Business Corporation Act, Article 9.03, the Texas Non-Profit Corporation Act, 
Article 1396-9.04 and the Texas Limited Liability Company Act, Article 8.03 
which give the secretary of state the power and authority reasonably necessary 
to enable the secretary of state to administer these acts efficiently and to 
perform its duties imposed by these acts. The amendments and new sections are 
also adopted on an emergency basis under Texas Civil Statutes, Article 6252-13a 
and the Government Code, sec.405.031 and sec.405.032 which give the secretary of 
state the authority to adopt rules of practice reasonably necessary to carry out 
its ministerial duties under the Act.
sec.71.4. Receipt of Letters and Papers <nl>by FAX and Otherwise.   Letters and 
other papers received in the Office of the Secretary of State will be stamped 
with the date of receipt. The time of day will not be stamped. No papers are 
received on Saturdays, Sundays, or state holidays. <nl>Document filing 
electronically submitted by transmission over a facsimile (FAX) machine to the 
Office of the Secretary of State on Saturdays, Sundays, state holidays, or after 
the business hours of 8 a.m. to 5 p.m. will be deemed to be received by the 
Office of the Secretary of State on the next business day or when actually 
received by an employee of the secretary of state.
sec.71.6. Public Record.
(a) Unless otherwise provided by constitutional provision, statutory provision, 
or judicial decision, all documents on file with the secretary of state are 
specifically declared to be public record.
(b) Because of the necessity of ensuring security of the files and file 
integrity, members of the general public shall not be allowed direct access to 
documents on file with the secretary of state without the prior approval of the 
appropriate division director, and unless the access is under the direct 
supervision of an employee of the secretary of state.
(c)  Documents on file will be produced for the examination of any person at 
such reasonable times and in such manner as will not interfere with the affairs 
of the Office of the Secretary of State.
sec.71.7. <nl>Requests to Transmit Documents by FAX Machine; Fee [Public 
Record].<nl> Upon the request of any person, the secretary of state will 
transmit a form or other document by facsimile or FAX machine to such person. 
The fee for this service shall be $2.00 per page. For purposes of assessing the 
relevant fee, the cover page or transmittal page of the form or other document 
will not be counted in determining the number of pages in the document. In 
addition to the fee specified herein, some documents may be subject to 
additional fees as set forth in other sections of the administrative rules 
governing the secretary of state.
[(a) Unless otherwise provided by constitutional provision, statutory provision, 
or judicial decision, all documents on file with the secretary of state are 
specifically declared to be public record.
[(b) Because of the necessity of ensuring security of the files and file 
integrity, members of the general public shall not be allowed direct access to 
documents on file with the secretary of state without the prior approval of the 
appropriate division director, and unless the access is under the direct 
supervision of an employee of the secretary of state.
[(c)  Documents on file will be produced for the examination of any person at 
such reasonable times and in such manner as will not interfere with the affairs 
of the Office of the Secretary of State.]
sec.71.8. Copies; Certified Copies; Fees for Copies.
(a)-(b)  (No change.)
(c) Fees for noncertified copies of documents on file in the Office of the 
Secretary of State shall be computed as follows:
(1)  <nl>eighty<ol> [fifty]-five cents for the first page of a document;
(2) -(3) (No change.)
sec.71.9. Fees; Payment of Money; Refunds.
(a) (No change.)
(b) All payments of money to the secretary of state should be made<nl>, except 
as may otherwise be provided in these sections,<ol> in United States specie, 
treasury notes, national bank notes, post office money orders, or by certified 
<nl>or personal<ol> check. Payment tendered in any other form will authorize the 
Office of the Secretary of State to delay or cancel the credit until collection 
is made. Money orders and checks must be made payable to the Secretary of State 
of Texas. Money sent by mail to the Office of the Secretary of State will be at 
the risk of the sender; letters containing money should be registered.
(c) (No change.)
sec.71.10. Special Services.
(a) Upon the request of any person, notice of any action taken by the secretary 
of state will be given the requesting party by means of a Telex message [or 
Mailgram]. The fee for this service shall be $4.00, in addition to any statutory 
fees required by law.
(b) Upon the request of any person, certification of the existence of any 
document on file in the Office of the Secretary of State will be given the 
requesting party by means of a Telex message [or Mailgram]. The fee for this 
service shall be $6.00, in addition to any statutory fees required by law.
(c) Upon the request of any person, the secretary of state will expedite the 
filing or reviewing of<nl> any<ol> [a] document  <nl>submitted to the 
Corporations Section, except for trademark documents which require a lengthy 
process of document review. The special handling fee for this service shall be 
$10<ol> [relating to a profit or non-profit corporation, professional 
corporation or association, cooperative association, or limited partnership].  
<nl>With respect to all documents submitted for special handling, the<ol> [On 
the day of receipt the] secretary of state will notify the sender<nl> in writing 
or by telephone that the document was filed<ol> [of the filing] or the reason 
why it [the document] was not filed. <nl>Such notification shall occur before 
the close of business on the next business day following the document's date of 
receipt. Unless the document sender provides a telephone number where the sender 
may be reached between the hours of 8 a.m. and 5 p.m., the secretary of state 
will not be obligated to telephone the sender regarding the disposition of the 
filing.<ol> [The fee for this service shall be $10.] Requests for expedited 
filing or <nl>review <ol> [reviewing] must be sent to: Secretary of State, 
Corporations <nl>Section <ol> [Division], Special Handling, P.O. Box 
<nl>13697<ol> [12436], Austin, Texas 78711- <nl>3697<ol> [2436].
(d)  Upon the request of any person, the secretary of state will expedite the 
handling of a certified record search pursuant to Business and Commerce Code, 
Chapter 9 or 35, or  <nl>Property Code, Chapter 14 <ol> [Texas Civil Statutes, 
1925, Title 1224, Article 1.07c, Taxation-General as amended]. The fee for this 
service shall be $5.00.
<nl>(e) Upon the request of any person, the secretary of state will expedite the 
handling of a request for certified copies or certificates of fact. The 
expedited order will be processed before the close of the next business day 
following the date of receipt. The fee for this service shall be $5.00 per 
certificate.
sec.71.12. Faxed Filings; Credit Card Payment Option.
(a)  Documents submitted to the Office of the Secretary of State for filing by 
electronic transmission using a facsimile (FAX) machine must be accompanied by 
appropriate payment of any applicable fees. Payment of these fees may be either 
simultaneously electronically transmitted with the documents or delivered to 
this office by the close of the same business day. Documents for which the 
applicable fees have not been received by the secretary of state on the same 
date of transmission will be returned to the sender without filing by regular 
mail.
(b) Fees payable to the Office of the Secretary of State may be paid with a 
valid and current VISA or Mastercard or such other credit card specified in the 
contract then existing between the Office of the Secretary of State, the Texas 
State Treasury Department, and the relevant financial institution.
(c) Fees payable to the Office of the Secretary of State may also be paid 
through an automated clearing house (ACH) debit system account established by an 
agreement executed between the debit system account applicant and the financial 
institution under contract to the Office of the Secretary of State and the Texas 
State Treasury Department.
(d) The Office of the Secretary of State requires users of the credit card 
payment option to pay the relevant fee or fees plus a credit card transaction 
charge. The amount of the credit card transaction charge to be collected per 
credit card transaction in connection with the secretary of state's credit card 
payment option has been initially set at 1.9% of the total fees incurred. The 
amount of this credit card transaction charge is subject to change, in 
accordance with the existing contract between the Office of the Secretary of 
State, the Texas State Treasury Department, and the relevant financial 
institution. For purposes of this rule, per credit card transaction shall be 
defined as simultaneous payment of one or more fees using a VISA or Mastercard 
or other valid and current credit card designated by the contract then existing 
between the Office of the Secretary of State, the Texas State Treasury 
Department, and the relevant financial institution. The purpose of the credit 
card transaction charge is to reimburse the secretary of state for the cost 
assessed by the relevant financial institution in providing the credit card 
payment option. The secretary of state shall deposit all fees and credit card 
transaction charges collected under the credit card payment option in the Texas 
State Treasury Department.
(e)  To utilize the credit card payment option for documents filed with the 
secretary of state, the document sender must either submit a completed credit 
card payment form available from the secretary of state or provide the following 
information in written form:
(1) the name of the credit card being used; (VISA or Mastercard or such other 
card as may be referred to in the contract between the Office of the Secretary 
of State, the Texas State Treasury Department, and the relevant financial 
institution.)
(2) the account number of the credit card;
(3) the expiration date of the credit card;
(4) the signature of the card holder;
(5) the sum of all fees to be charged; and
(6) a credit card transaction charge equal to 1.9% of the total amount of fees 
incurred in the transaction.
(f) If a credit card payment is dishonored when presented by the state for 
payment, the secretary of state shall treat the document submitted for filing in 
the same manner as if no filing fee had been presented. The secretary of state 
will then be entitled to take all appropriate action authorized by law.
Effective date: October 28, 1991
Expiration date: February 25, 1991
Issued in Austin, Texas, on October 25, 1991.
TRD-9113246
Lorna Wassdorf
Special Assistant, Statutory Filings Division
Office of the Secretary of State
For further information, please call: (512) 463-5586.
Chapter 79. Corporations
The Office of the Secretary of State adopts on an emergency basis amendments to 
sec.sec.79.1-79.3, 79.8, 79.11, 79.17, 79.30-79.34, 79.36-79.50, and 79.54, new 
sec.sec.79.13-79.15, and 79.52, concerning the Corporations Section. The 
amendments to sec.79.1 and sec.79.2, concern changes in the name and address of 
the Corporations Section of the Office of the Secretary of State. Amendments to 
sec.sec.79.3, 79.8 and 79.11 relate to electronically transmitted filings to the 
Office of the Secretary of State. Amended sec.79.17 provides that a limited 
liability company may change its address on its certificate of withdrawal. New 
sec.79.52 relates to name availability rules for limited liability companies. 
New sec.79.13 and sec.79.14 establish procedures for documents filed with 
delayed effective dates. New sec.79.15 provides for identification of applicants 
for name reservations and name registrations. Amendments to the following 
sections concern entity name availability determinations:  ssec.79.30-79.34, 
79.36, 79.50, and 79.54.
The amendments to the rules reflect a change of address of the Office of the 
Secretary of State. In addition, the Corporations Division has been renamed the 
Corporations Section.
House Bill 278 added Texas Miscellaneous Corporation Laws Act, Article 1302-7. 
07 and the Texas Revised Limited Partnership Act, Article 6132a-1, sec.13.04, 
effective August 26, 1991, eliminating the requirement for original signatures 
on corporate and limited partnership filings. Document filings electronically 
submitted by transmission over a facsimile (FAX) machine to the Office of the 
Secretary of State will be accepted for filing in the same manner as other 
documents submitted in person or by common courier.
The acceptance of electronically transmitted documents directly to the Office of 
the Secretary of State necessitates amendment to existing rules concerning date 
of receipt, hour of filing, and receipt of letters, documents, and papers.
The Texas Limited Liability Company Act, effective August 26, 1991, provides 
that a foreign limited liability company authorized to transact business in this 
state may withdraw from this state upon the procuring from the Secretary of 
State a certificate of withdrawal. Amended sec.79.17 will also allow a limited 
liability company to change the address indicated on its certificate of 
withdrawal for purposes of mailing copies of process against the company served 
on the secretary of state.
The Texas Business Corporation Act, Article 10.03, as amended by House Bill 278 
permits a business to file certain documents with a delayed effective date. The 
filing must become effective no later than a date within 90 days of submission. 
The Texas Business Corporation Act, Article 10.03, provides that documents which 
will become effective upon the occurrence of events or facts that may occur in 
the future must contain the date of the 90th day after the date of the filing of 
such articles, statement, application or other filing. New sec.79.13 establishes 
how to calculate the precise date to include in the document submitted for 
filing as the date of the 90th day after the date of filing.
When a condition triggering the effectiveness of a document has been satisfied 
or waived, a statement regarding the delayed effective condition must be 
submitted to the secretary of state. New sec.79.14 sets forth certain 
information that must appear in the statement regarding the delayed effective 
condition. This information will allow the secretary of state to identify the 
original document to which the statement of delayed effective condition relates.
The Texas Limited Liability Company Act, effective August 26, 1991, also 
provides that the name of a limited liability company shall not be the same as 
or deceptively similar to, the name of any domestic limited liability company, 
corporation, or limited partnership existing under the laws of this state, or 
the name of any foreign limited liability company, corporation, or limited 
partnership authorized to transact business in this state, or a limited 
liability company, corporation, or limited partnership name that is reserved or 
registered in this state under an applicable statute. Therefore, the corporate 
name availability section will be renamed, "entity name availability" and the 
existing name availability sections will be expanded to make them applicable to 
corporations, limited partnerships, and limited liability companies.
It is necessary to adopt these sections as an emergency to protect the welfare 
of those members of the public who may be filing documents pursuant to House 
Bill 278 immediately upon its effective date, but prior to the effective date of 
the proposed rules necessary to properly administer the new Act.
General Information and Correspondence
1 TAC sec.sec.79.1-79.3, 79.8, 79.11, 79.13-79.15, 79.17
The amendments and new sections are adopted on an emergency basis under the 
Texas Business Corporation Act, Article 9.03, the Texas Nonprofit Corporation 
Act, Article 1396-9.04, and the Texas Limited Liability Company Act, Article 8. 
03 which give the secretary of state the power and authority reasonably 
necessary to enable the secretary of state to administer these Acts. The 
amendments and new sections are also proposed under Texas Civil Statutes, 
Article 6252-13a, and the Government Code, sec.405.031 and sec.405.032, which 
give the Office of the Secretary of State the authority to adopt rules of 
practice reasonably necessary to carry out its ministerial duties under the Act.
sec.79.1. Address of Communications Intended for the Corporations <nl>Section  
[Division]. All letters and other communications intended for the Corporations  
<nl>Section<ol> [Division] should be addressed to Secretary of State, 
Corporations<nl> Section<ol> [Division], P.O. Box 13697, [Capitol Station,] 
Austin, Texas 78711-<nl>3697.
sec.79.2. Business To Be Transacted in Writing. <ol> All business with the 
Corporations <nl>Section<ol> [Division] should be transacted in writing. The 
action of the Corporations <nl>Section <ol> [Division] will be based exclusively 
on the written record in the <nl>section<ol> [division].
sec.79.3. Receipt of Letters and Documents.<nl> An employee of the secretary of 
state will <ol>[Letters or documents received in the Corporations Division are] 
<nl>stamp<ol> [stamped] <nl> all letters or documents received in the 
Corporations Section<ol> with <nl>its <ol> [the] date of receipt. The hour of 
receipt is not noted. Documents are not received in the Corporations 
<nl>Section<ol> [Division] on Saturdays, Sundays, or state holidays. Documents 
may be delivered by hand during office hours; office hours are 8 a.m. to 5 p.m. 
Mail is not considered as received in the Corporations <nl>Section <ol> 
[Division] until it has been brought from the post office or otherwise hand-
delivered to the Office of the Secretary of State. <nl>For rules concerning date 
of receipt of documents filed electronically using a facsimile or (FAX) machine, 
see sec.71.4 of this title (relating to Receipt of Letters and Papers).
sec.79.8. Date of Receipt. The date of receipt of a letter or document is the 
date stamped or written on the letter, document, or envelope by an employee of 
the secretary of state. A postmark, <nl>a date generated on a letter or document 
solely as a result of its electronic transmission<ol> or a date placed on a 
letter, document, or envelope by some person other than an employee of the 
secretary of state cannot be considered as the date of receipt.
sec.79.11. Hour of Filing. The hour of filing of a <nl>letter or<ol> document 
will not be noted<nl> on the letter or document by the Office of the Secretary 
of State. However, documents permitted by law to contain delayed effective dates 
and times may designate a time of effectiveness within the contents of the 
document. The time of transmission generated on or appearing on a letter or 
document will not be regarded by the Office of the Secretary of State as its 
hour of filing.
sec.79.13. Determining the Date of the 90th Day After the Date of Filing.
(a) For purposes of filing documents which will become effective upon the 
occurrence of events or facts that may occur in the future, pursuant to the 
Texas Business Corporation Act, Article 10.03, the date of the 90th day after 
the date of filing shall be deemed to be 90 days after the document is delivered 
in person or placed in the United States Post Office or in the hands of a common 
or contract carrier properly addressed to the Office of the Secretary of State. 
The postmark or receipt mark (if received by a common or contract carrier) will 
be prima facie evidence of the date that such statement was deposited with the 
post office or carrier. The person filing the document may show by competent 
evidence that the actual date of posting was to the contrary.
(b) If a document submitted with a delayed effective condition pursuant to the 
Texas Business Corporation Act, Article 10.03 does not conform to law, it will 
be returned to sender. When the document is corrected and resubmitted, the date 
of the 90th day after the date of filing may be recalculated and restated in the 
document to be 90 days after the document is resubmitted by delivery in person 
or placement in the United States Post Office or in the hands of a common or 
contract carrier properly addressed to the Office of the Secretary of State. The 
postmark or receipt mark generated in connection with the resubmission (if 
received by a common or contract carrier) will be prima facie evidence of the 
date that such statement was deposited with the post office or carrier. The 
person filing the document may show by competent evidence that the actual date 
of posting of the resubmission was to the contrary. The secretary of state will 
refer to the contents of the document to determine the date of the 90th day from 
the date of filing or refiling.
(c) To calculate the date of the 90th day from the date of filing, refer to 
calendar days as set forth in sec.71.5 of this title (relating to Times for 
Taking Action).
sec.79.14. Statement Regarding Delayed Effective Condition.
(a) Contents. Pursuant to the Texas Business Corporation Act, Article 10. 03 and 
the Texas Revised Limited Partnership Act, Article 2.12, when a condition 
triggering the effectiveness of a document filing has been satisfied or waived, 
a statement regarding the delayed effective condition must be submitted to the 
secretary of state. Such statement must contain the following information:
(1) the name of the business entity;
(2) the charter or file number of the entity;
(3) the document to which the statement applies;
(4) the date of filing of the document to which the statement applies;
(5) the date on which the condition was satisfied or waived;
(6) the signatures required by the Texas Business Corporation Act, Article 10.03 
and the Texas Revised Limited Partnership Act, Article 2.12.
(b) Timeliness. Pursuant to the Texas Business Corporation Act, Article 10.03, 
the statement regarding the delayed effective condition should be filed in the 
Office of the Secretary of State by the date of the 90th day from the date of 
filing as defined in sec.79.13 of this title (relating to Determining the Date 
of the 90th Day After the Date of Filing). Statements regarding the delayed 
effective condition received after the date of the 90th day from the date of 
filing will be filed for record, however the secretary of state will not 
determine substantial compliance with the provisions of the Texas Business 
Corporation Act, Article 10.03.
sec.79.15. Identification of Application for Name Reservations and Name 
Registrations.  All applicants for name reservations or name registrations must 
identify the type of entity or the statute under which the reservation or 
registration is sought. This will enable the secretary of state to identify the 
appropriate filing fee for such name reservation or registration.
sec.79.17. Address on Certificate of Withdrawal.  The Texas Business Corporation 
Act, <nl>Article 8.14, <ol> [and Article 1396-8.13 of] the Texas Nonprofit 
Corporation Act<nl>, Article 1396-8.13, and the Texas Limited Liability Company 
Act, Article 7.9<ol> require a foreign corporation  <nl>or limited liability 
company <ol> to designate a post office address on a certificate of withdrawal 
to which the secretary of state may mail a copy of any process against the 
corporation that may be served on the secretary of state. After the filing of 
the certificate of withdrawal, a corporation  <nl>or limited liability company 
<ol> may change this address by notifying the secretary of state of such change 
in writing.
Effective date: October 28, 1991
Expiration date: February 25, 1992
Issued in Austin, Texas, on October 25 , 1991.
TRD-9113248
Lorna Wassdorf
Special Assistant, Statutory Filings Division
Office of the Secretary of State
For further information, please call: (512) 463-5586.
       
1 TAC sec.sec.79.30-79.34, 79.36-79.50, 79.52, 79.54
The amendments and new section are adopted on an emergency basis under the Texas 
Business Corporation Act, Article 9.03, the Texas Nonprofit Corporation Act, 
Article 1396-9.04, and the Texas Limited Liability Company Act, Article 8. 03, 
which give the secretary of state the power and authority reasonably necessary 
to enable the secretary of state to administer these Acts efficiently and to 
perform its duties imposed by these Acts. The amendments and new section are 
also adopted on an emergency basis under Texas Civil Statutes, Article 6252-13a, 
and the Government Code, sec.405.031 and sec.405.032 which give the Office of 
the Secretary of State the authority to adopt rules of practice reasonably 
necessary to carry out its ministerial duties under the Act.
sec.79.30. Applicability.<nl> Pursuant to the Texas Business Corporation Act, 
Article 2.05, the Texas Revised Limited Partnership Act, sec.1. 03 and the Texas 
Limited Liability Company Act, Article 2.03, <ol>[Section 103 of the Texas 
Revised Limited Partnership Act provides that the]<nl> a proposed entity<ol> 
name [of a limited partnership] may not be the same as, or deceptively similar 
to, the name of a Texas or qualified foreign corporation<nl>, <ol> [or] limited 
partnership, or<nl> limited liability company.<ol> [a name that has been 
reserved or registered for a corporation, limited partnership, or foreign 
limited partnership, except that a consent may be obtained as appropriate.] In 
accordance therewith, these sections [rules] shall apply to all name 
availability determinations made for either a corporation <nl>,<ol> [or] limited 
partnership<nl> or limited liability company name. Such names may be set forth 
in an entity's organizational document, reserved or registered name or 
application for a foreign entity to transact business in Texas<ol>. Wherever the 
terms<nl> entity or entities appears in this entity name availability section, 
they may be replaced with the following terms: domestic or foreign corporation; 
domestic or foreign limited partnership; or domestic or foreign limited 
liability company<ol> ["proposed corporate name", "corporate name", or 
"corporation", or the plural of such terms are used in the sections under this 
undesignated head, such terms shall be interchangeably with the terms "limited 
partnership", "foreign limited partnership",] or the plural of such terms.
sec.79.31. Characters of Print Acceptable in Names.
(a)  <nl>Entity<ol> [Corporate] names may consist of letters of the Roman 
alphabet, Arabic numerals, and certain symbols capable of being reproduced on a 
standard English language typewriter, or combination thereof.
(b)-(d)  (No change.)
sec.79.32. False Implication of Governmental Affiliation; False Implication of 
Purpose.
(a) The<nl> entity<ol> [corporate] name may not be one that might falsely imply 
governmental affiliation. Example: Texas Real Estate Commission, Inc.
(b) The <nl>entity<ol> [corporate] name may not imply a purpose which would be 
unlawful for the <nl>entity <ol> [corporation] to conduct.
(1) The word "insurance" must be accompanied by other words which remove the 
implication that the<nl> entity<ol> [corporate] purpose is to be an insurer. The 
name may include the phrase "insurance agency" or "insurance agent."
(A)-(B) (No change.)
(2)  The word "bail bond" and "surety" imply an unlawful purpose as entities 
[corporations] with these powers must be <nl> organized <ol>[incorporated] under 
the Texas Insurance Code and these words may not be used in the name of a 
business <nl>entity<ol> [corporation].
(A)-(B) (No change.)
sec.79.33. Grossly Offensive Name. The<nl> entity <ol>[corporate] name may not 
be one that is deemed to be so grossly offensive as to be unacceptable as<nl> an 
entity<ol> [a] name.
sec.79.34. Words of Incorporation<nl> or Organization.
(a)  Words of incorporation include "company," "corporation," "incorporated," 
and, in the case of a foreign corporation, "limited," and their acceptable 
abbreviations. The acceptable abbreviations are, respectively: "Co.," "Corp.," 
"Inc.," and "Ltd." The words "companies," "corporations," "incorporation," and 
"unlimited" when used alone<nl> do not satisfy the statutory requirements for 
words of incorporation. In addition, none of the words or abbreviations listed 
in this section or other variations of the statutory terms may be used as a 
sufficient basis to distinguish two otherwise deceptively similar or same names. 
<ol>[are not acceptable].
<nl>(b) Words of organization of a domestic or foreign limited partnership 
include "limited partnership," "limited," and their acceptable abbreviations. 
The acceptable abbreviations are, respectively: "LP," or "Ltd." The words 
"limited partnerships," or other variations of the statutory terms when used 
alone are not acceptable. In addition, none of the words or abbreviations listed 
in this section or other variations of the statutory terms may be used as a 
sufficient basis to distinguish two otherwise deceptively similar or names.
<nl>(c) The word of organization of a domestic or foreign limited liability 
company is "Limited." The acceptable abbreviations are: "Ltd." and "LC" The 
words "LLC" or "company" or other variations of the statutory terms when used 
alone are not acceptable. In addition, neither the word nor the abbreviations 
listed in this section or other variations of the statutory terms may be used as 
a sufficient basis to distinguish two otherwise deceptively similar or same 
names.
sec.79.36. "Same" Defined. <nl> Entity<ol> [Corporate] names are the "same" if a 
comparison of the names reveals no difference.
sec.79.37. "Deceptively Similar" Defined.<nl> Entity<ol> [Corporate] names are 
"deceptively similar" if on comparison of the names by the secretary of state 
there is an apparent difference, but the difference is such that the names are 
likely to be confused.
sec.79.38. "Deceptively Similar" Name Not Acceptable.  A proposed<nl> entity<ol> 
[corporate] name which is deemed to be "deceptively similar" to <nl>an<ol> 
[a]<nl> entity<ol> [corporate] name on file with the secretary of state cannot 
be filed even though the existing<nl> entity <ol> [corporation] may grant a 
letter of consent.
sec.79.39. Name "Deceptively Similar" When. A proposed <nl> entity<ol> 
[corporate] name is deemed to be "deceptively similar" to<nl> an<ol> [a]<nl> 
entity <ol> [corporate] name on file if any of the following conditions exist:
(1) The difference in the names consists in the use of different words of 
incorporation<nl> or organization<ol>. Example: Sampson, Inc. is "deceptively 
similar" to Sampson Corporation.
(2)-(3) (No change.)
(4) The difference consists in the presence or absence of letters which do not 
alter the names sufficiently to make them readily distinguishable. <nl>This 
applies to names that are spelled differently, but sound alike when spoken thus 
making the names difficult to distinguish upon hearing.
(A) -(C) (No change.)
<nl>(D) Example: AA Trucking is "deceptively similar" to Double A Trucking.
<nl>(E) Example: Four Winds, Inc. is "deceptively similar" to 4 Winds Corp. and 
IV Winds Inc.
sec.79.40. "Similar Requiring Letter of Consent" Defined. <nl> Entity<ol> 
[Corporate] names are "similar requiring letter of consent" if a comparison of 
the names by the secretary of state reveals similarities which may tend to be 
misleading as to the identity or affiliation of the<nl> entity<ol> 
[corporation], but not to the extent that the names are the "same" or 
"deceptively similar."
sec.79.41. "Similar Requiring Letter of Consent" Acceptable with Letter.  A 
proposed name which is deemed to be "similar requiring letter of consent" cannot 
be filed without a letter of consent. No waiver of a required letter of consent 
will be allowed even though it may appear that the existinge<nl> entity<ol> 
[corporation] is not actively engaged in business, is about to change its name, 
be dissolved, forfeited, or merged out of existence.
sec.79.42. Form of Consent. No particular form of consent is required. The 
consent must be in writing and signed by an officer or authorized agent of the 
consenting <nl> entity<ol> [corporation]. Consent given orally or by telegraph 
cannot be accepted. Consent from more than one <nl>entity<ol> [corporation] may 
be required in some instances. The letter of consent must not state conditions; 
it must give unequivocal consent.
sec.79.43. "Similar Requiring Letter of Consent" When. <ol> A proposed<nl> 
entity <ol> [corporate] name is "similar requiring letter of consent" if any of 
the following conditions exist:
(1) The proposed <nl>entity<ol> [corporate] name is the "same" as, or 
"deceptively similar" to,<nl> an<ol> [a] <nl>entity<ol> [corporate] name on file 
except for a geographical designation at the end of the name.
(A)-(B) (No change.)
(2) The first two or more words of a proposed<nl> entity<ol> [corporate] name 
are the "same as, " or "deceptively similar" to, the first two words of <nl> 
an<ol> [a]  <nl>entity<ol> [corporate] name on file, but are not frequently used 
in combination.
(A)-(D) (No change.)
<nl>(E) Example: Acme Electric Corporation would need a letter of consent from 
Acme Electrical Inc.
(3) The proposed<nl> entity<ol> [corporate] name is the "same" as, or 
"deceptively similar" to,<nl> an<ol> [a]<nl> entity<ol> [corporate] name on file 
except for a numerical expression which implies that the proposed <nl>entity<ol> 
[corporation] is an affiliate of or in a series with the existing <nl>entity<ol> 
[corporation]. Example: A letter of consent from an existing <nl> entity<ol> 
[corporation] named united Company would be required in order to file any of the 
following:
(A)-(C)  (No change.)
(4) If the <nl>entity<ol> [corporate] name on file has only one significant word 
and the proposed<nl> entity <ol> [corporate] name consists of the same word 
followed by some other significant word, the proposed <nl>entity <ol> 
[corporate] name is not "similar requiring letter of consent." Example: A letter 
of consent from an existing <nl>entity <ol> [corporation] named United Company 
would not be required in order to file any of the following:
(A)-(I) (No change.)
(5) The proposed<nl> entity<ol> [corporate] name contains the same words as an 
existing <nl>entity<ol> [corporate] name but the words are inverted.
(A)-(B) (No change.)
sec.79.44. Alphabet Names. <ol> Where a name or a unit of names consists of 
initials only or letters of the alphabet, the combination of initials will be 
considered as one word for the purpose of applying name availability rules.
(1)-(2) (No change.)
<nl>(3) Example: AA Car Rental, Inc. is deceptively similar to Double A Car 
Rental, Corp.
sec.79.45. Surnames.
(a) A surname is considered to be a "word. " Where a proposed <nl>entity<ol> 
[corporate] name contains a surname as the second "word" and contains a given 
name or initials as a first "word" which is different from the first "word" of 
an existing <nl>entity <ol>[corporation], the name is not similar.
(1)-(3) (No change.)
(b) (No change.)
sec.79.46. Exception for Churches.<nl> Entity<ol> [Corporate] names of churches 
will not be considered similar if there is some sufficient basis for 
distinguishing the name from an existing entity name. Example: First Baptist 
Church of Wimberley is not similar when compared to First Baptist Church of 
Austin.
sec.79.47. Foreign Words Nontranslated.
(a) Although <nl>entity<ol> [corporate] names may consist, in whole or in part, 
of words in a foreign language which utilize letters of the Roman alphabet, such 
words will not be translated for purposes of determining <nl>entity<ol> 
[corporate] name availability.
(1)-(2) (No change.)
(b) (No change.)
sec.79.48. Matters Not Considered. Only the proposed <nl>entity<ol> [corporate 
or limited partnership] name, the names of active (not dead, dissolved, or 
forfeited) <nl>entities<ol> [corporations, limited partnerships], name 
reservations, and name registrations for <nl> entities<ol> [a corporation or a 
limited partnership] on file are considered in determining name availability. 
Among matters not considered are the following:
(1)  whether the purpose of a proposed <nl>entity <ol> [corporation] is the same 
as or similar to the purpose of an existing <nl>entity<ol> [corporation];
(2) whether the<nl> entities<ol> [corporations] will be carrying out activities 
in the same or nearby locations;
(3) whether an analagous situation has previously been acted upon by the 
Corporations <nl>Section<ol> [Division];
(4) (No change.)
(5) whether an existing <nl>entity<ol> [corporation] is actively engaged in 
business, or has a telephone listing, or a location of a place of business;
(6) whether an existing <nl>entity<ol> [corporation] is about to change its 
name, or be dissolved, or merged out of existence;
(7) whether a response to an inquiry can be obtained from an existing 
<nl>entity<ol> [corporation];
(8)  (No change.)
(9) whether the applicant is more or less important, extensive, widely known, or 
influential than an existing  <nl>entity<ol> [corporation];
(10)  whether the applicant has a prior or superior right to the use of a name 
apart from what might be shown on inspection of the names of active<nl> 
entities<ol> [corporations] on file in the <nl>entity<ol> [corporate] records of 
the secretary of state; or
(11) (No change.)
<p <nl>(12) whether an existing entity has filed for or intends to file for 
bankruptcy.
sec.79.49. Final Determination of Name Availability.  An employee of the 
Corporations <nl> Section<ol> [Division] may express an opinion on name 
availability in response to a written, telephone, or other oral request; but 
such an opinion is not a final determination that the name will or will not be 
accepted for filing and stamped filed. A final determination is made only when 
the document is submitted for filing.
sec.79.50. Professional Corporations and Associations.<nl> Names <ol> [Corporate 
names] of professional corporations and professional associations are governed 
by these rules and by the laws or ethics regulating the practice of the 
professional service rendered through the professional corporation or 
professional association.
sec.79.52. Limited Liability Companies. The name of a limited liability company 
as stated in its articles of organization, a reserved or registered name, or the 
name under which a foreign limited partnership is permitted to register to do 
business in Texas as contained in its application for registration as a foreign 
limited liability company is governed by the sections under this undesignated 
head.
sec.79.54. Examples Not Exclusive.
(a) (No change.)
(b)  The conditions used in these sections are not meant to be exclusive, nor 
should they be used to limit the determination of whether a proposed name is the 
same as, deceptively similar to, or similar to, the name of an existing<nl> 
entity<ol> [corporation].
(c) The examples used in these sections are not meant to be exclusive, nor 
should they be used to limit the determination of whether a proposed name is the 
same as, deceptively similar to, similar to, the name of an existing <nl>entity 
<ol> [corporation].
Effective date: October 28, 1991
Expiration date: February 25, 1992
Issued in Austin, Texas, on October 25, 1991.
TRD-9113250
Lorna Wassdorf
Special Assistant, Statutory Filings Division
Office of the Secretary of State
For further information, please call: (512) 463-5586.
       
Chapter 80. Unincorporated Business Entities
1 TAC sec.sec.80.1-80.4
The Office of Secretary of State adopts on an emergency basis new sec.sec.80. 1-
80.4, concerning administrative rules to the entitled, "Unincorporated Business 
Entities." This chapter will address rules concerning unincorporated business 
entities such as limited liability companies and registered limited liability 
partnerships. Both the Texas Limited Liability Company Act (TLLCA) creating 
limited liability companies registered limited liability partnerships took 
effect on August 26, 1991.
House Bill 278 added Texas Uniform Partnership Act, Article 6132b, sec.45-A to 
sec.45-C, effective August 26, 1991, to create registered limited liability 
partnerships (LLPs). LLPs are not subject to the name availability rules set 
forth in Chapter 79 of the this title. Hence, it is possible that multiple LLPs 
could register with the Office of the Secretary of State under the same or 
deceptively similar partnership name. To enable the secretary of state to 
distinguish between similarly named LLPs, new sec.80.1 directs an LLP filing of 
its initial or renewal application or as soon as possible thereafter. Section 
80. 1 also sets forth additional requirements for initial LLP applications.
The Texas Uniform Partnership Act, sec.45-A also establishes that registration 
of an LLP expires one year after the date of filing of initial registration. 
Section 80.1 addresses the contents of a renewal application and the 
consequences of failing to renew. Section 80.2 addresses withdrawal of 
registration as a registered limited liability partnership and the consequences 
thereof. Section 80.3 establishes that the secretary of state will not 
determined whether or not an LLP is in substantial compliance with all of the 
requirements of the Texas Uniform Partnership Act. Finally, sec.80.4 authorizes 
corrections for LLP filings containing typographical errors.
It is necessary to adopt these sections as an emergency to protect the welfare 
of those members of the public who may be filing documents pursuant to House 
Bill 278 immediately upon its effective date, but prior to the effective date of 
the proposed rules necessary to properly administer the new Act.
The sections are adopted on an emergency basis under Texas Civil Statutes, 
Article 6252-13a, and the Government Code,  s405.031 and sec.405.032 which give 
the Office of the Secretary of State the authority to adopt rules of practice 
reasonably necessary to carry out its ministerial duties under the Act.
sec.80.1. Application for Registration as a Registered Limited Liability 
Partnership.
(a) Initial application. To become a registered limited liability partnership, a 
partnership must comply with the Texas Uniform Partnership Act, Article 6132b, 
sec.45-A to sec.45-C. The secretary of state has promulgated a from for this 
purpose, however use of such form is not mandatory. Applications submitted for 
filing with the secretary of state must contain the following information:
(1) the name of the partnership;
(2) the federal tax identification number of the partnership;
(3) the street address of its principal office in this state and outside this 
state, as applicable;
(4) the number of partners at the date of application;
(5) a brief statement of the business in which the partnership engages.
(b) Name of the partnership. The name of the registered limited liability 
partnership shall contain the words "registered limited liability partnership" 
or the abbreviation "LLP" as the last words or letters of its name.
(c) Copies. Two copies of the application shall be filed with the secretary of 
state along with the appropriate filing fee. The secretary of state will endorse 
the word "filed," and the month, day, and year of the filing on each copy of the 
application. The secretary of state will then return one copy of the filed 
application and a letter of acknowledgment to the registered limited liability 
partnership.
(d) Registration. A partnership is registered on filing a complete initial or 
renewal application executed as specified in the Texas Uniform Partnership Act, 
Article 6132b, sec.45-A to sec.45-C in duplicate with the required fee.
(e) Date of filing. The date of filing of any document specified in these 
sections which conforms to law and for which the filing fee has been paid will 
be the same date as the date of receipt. If a document does not conform to law, 
it will be returned to the sender. When the document is corrected and 
resubmitted, the date of filing of the document will be the same date as the 
date of the last receipt. The date of filing may not be a date prior to the date 
of which the document is found to conform to law.
(f) Expiration. An initial or renewal application filed under this section and 
registered by the secretary of state shall be effective for a period of one year 
from the date on which the application for registration is filed.
(g) Renewal. A registered limited liability company may renew its registration 
from year to year by filing annually an application for renewal in the manner 
prescribed for the filing of an original application. Such renewal application 
shall be filed during the 90 days preceding the expiration date of the then 
current registration. The renewal application must be accompanied by a fee of 
$100 for each person who is a partner on the date of renewal.
(h) Revocation of registration. The secretary of state may revoke the 
registration of a partnership that pays a fee by an instrument that is 
dishonored when presented by the secretary of state for payment and the 
partnership fails to pay the fee within 30 days after the secretary of state 
mails notice of dishonor of the instrument to the partnership at its principal 
office in this state or outside this state as applicable. A revocation is 
effective as of the date of filing of the application but does not affect any 
prior registration.
sec.80.2. Withdrawal of Registration.
(a) Withdrawal. A registration may be withdrawn by filing in duplicate with the 
secretary of state a written withdrawal notice executed by a majority in 
interest of the partners or by one or more partners authorized by a majority in 
interest of the partners. No fee is required for a withdrawal under this 
section. A withdrawal notice terminates the status of the partnership as a 
registered limited liability partnership as of the date of filing the notice. A 
withdrawal notice must include the following information:
(1) the name of the partnership;
(2) the federal tax identification number of the partnership;
(3) the date of registration of the partnership's last application under this 
section;
(4) a current street address of the partnership's principal office in this state 
and outside this state, if applicable;
(5) a statement that the partnership intends to withdraw its registration.
(b) Removal from active records. The secretary of state may remove from its 
active records the registration of a partnership whose registration has been 
withdrawn or has expired and not been renewed.
sec.80.3. Administrative Review. <ol> The secretary of state will file for 
record a completed, properly executed initial application for registration or 
renewal of registration as a registered limited liability partnership when the 
appropriate filing fee has been remitted. The secretary of state will not 
determine substantial compliance with the provisions of the Texas Uniform 
Partnership Act nor will the secretary of state determine whether or not the 
partnership meets the insurance requirements of the Act, sec.45-C.
sec.80.4. Typographical Corrections. <ol> If a document filed under the Texas 
Uniform Partnership Act, Article 6132b, 45-A to sec.45-C contains a 
typographical error, the error may be corrected by filing articles of correction 
executed by a majority in interest of the partners or by one or more partners 
authorized authorizes by a majority in interest of the partners. The articles of 
correction must contain the following information: the name of the partnership; 
the federal tax identification number of the partnership, the identity of the 
document being corrected; the date on which the document being corrected was 
filed, the typographical error being corrected; and the correction of the error. 
Two copies of the articles of correction must be filed. The filing fee for 
articles of correction is $15.
Issued in Austin, Texas, on October 25, 1991.
TRD-9113252
Lorna Wassdorf
Special Assistant, Statutory Filings Division
Office of the Secretary of State
Effective date: October 28, 1991
Expiration date: February 25, 1992
For further information, please call: (512) 463-5586
       
Title 22. EXAMINING BOARDS
Part XXII. Texas State Board of Public Accountancy
Chapter 521. Fee Schedule
22 TAC sec.521.1
The Texas State Board of Public Accountancy proposes an emergency amendment to 
sec.521.1, concerning fee schedule. This amendment is necessary to raise fees 
pursuant to the Public Accountancy Act of 1991, and to collect fees on a 
biennial basis.
The amendment is adopted on an emergency basis under Texas Civil Statutes, 
Article 41a-1, sec.6(a), which provide the Texas State Board of Public 
Accountancy with the authority to promulgate rules to effectuate the Act.
sec.521.1. License Fees.
(a) The <nl>biennial<ol> [annual] fee for a license issued to an individual not 
in retired or disabled status shall be <nl>$120 <ol> [$30]; however, the initial 
license fee shall be prorated <nl>at $5.00 per month for those months during 
which the license is valid.<ol> [as shown:]
[graphic]
(b) The annual fee for a license issued to a practice unit shall be <nl>$100<ol> 
[$50] and may not be prorated.
Issued in Austin, Texas, on October 23, 1991.
TRD-9113115
William Treacy
Executive Director
Texas State Board of Public Accountancy
Effective date: October 23, 1991
Expiration date: February 20, 1992
For further information, please call: (512) 450-7066
       
TITLE 40. SOCIAL SERVICES AND ASSISTANCE
Part I. Texas Department of Human Services
Chapter 19. Long Term Care Nursing Facility Requirements for Licensure and 
Medicaid Certification
Subchapter U. State and Local Requirements
40 TAC sec.19.2012
The Texas Department of Human Services (DHS) adopts the repeal on an emergency 
basis, of sec.19.2012, concerning remedies for violations of Title XIX nursing 
facility provider agreements, in its Long Term Care Nursing Facility 
Requirements for Licensure and Medicaid Certification chapter. DHS also adopts, 
on an emergency basis, new sec.19.2012, concerning remedies for violations of 
Title XIX nursing facility provider agreements, in the same chapter. The purpose 
of the emergency repeal and adoption is to give the department the authority to 
levy and collect remedies from nursing facilities that fail to meet 
requirements, as cited by surveyors for the Texas Department of Health (TDH).
The department adopts the repeal and new section on an emergency basis effective 
November 1, 1991, because the lack of authority to levy and collect remedies 
from nursing facilities that fail to meet requirements may lead to deficient 
care, which constitutes and imminent peril to the health, safety, and welfare of 
long term care nursing facility residents; and because provisions of the Omnibus 
Budget Reconciliation Act of 1987, effective October 1, 1990, require that 
states have such a system of remedies.
The repeal is adopted on an emergency basis under the Human Resources Code, 
Title 2, Chapter 32.021(d)-(g) and 31.024(a), which authorizes the Department of 
Human Services to levy and collect remedies from nursing facilities that fail to 
meet Long-Term Care Nursing Facility Requirements for Licensure and Medicaid 
Certification, as cited by surveyors for the Texas Department of Health.
sec.19.2012. Remedies for Violations of Title XIX Nursing Facility Provider 
Agreements.
Issued in Austin, Texas, on October 27, 1991.
TRD-9113275
Nancy Murphy
Agency liaison, Policy and Document Support
Texas Department of Human Services
Effective date: November 1, 1991
Expiration date: February 29, 1992
For further information, please call: (512) 450-3765
       
The new section is adopted on an emergency basis under the Human Resources Code, 
Title 2, Chapter 32.021(d)-(g) and 32.024(a), which authorizes the Department of 
Human Services to levy and collect remedies from nursing facilities that fail to 
meet Long Term Care Nursing Facility Requirements for Licensure and Medicaid 
Certification, as cited by surveyors for the Texas Department of Health.
sec.19.2012. Remedies for Violations of Title XIX Nursing Facility Provider 
Agreements.
(a) The following words and terms, when used in this section, shall have the 
following meanings, unless the context clearly indicates otherwise.
(1) Appointment of temporary management-May be state personnel or private 
individuals with education and the requisite experience in nursing home 
administration and be licensed by the Texas Board of Licensure for Nursing Homes 
Administrators.
(2) Deficiency-A finding (or findings) of sufficient severity and/or scope that 
addresses cited requirements, identifies the facility's responsibility, and 
requires corrective action.
(3) Finding-A determination by the Texas Department of Health Long-Term Care 
Unit (TDH/LTCU) surveyor that a problem is preventable, is known or unknown to 
the facility, is not being corrected by proper action, or cannot be justified.
(4) Immediate and serious threat-A high probability that serious harm or injury 
to patients could occur at any time, or already has occurred and may well occur 
again if patients are not protected effectively from the harm, or the threat is 
not removed. Any situation in which a facility's noncompliance with one or more 
requirements for participation poses an immediate and serious threat to 
residents' health and safety, making immediate corrective action necessary.
(5) New Medicaid admission-The admission of a resident who has never been 
previously admitted to the facility or who, if previously admitted, was 
discharged or voluntarily left the facility. New admissions do not include the 
following:
(A) individuals who lived in the facility before the effective date of denial of 
payment for new admissions, even if the individuals become eligible for Medicaid 
after that date; and
(B) individuals who, after a temporary absence from the facility for a 
therapeutic visit as described in sec.19.1703 of this title (relating to 
Therapeutic Home Visits Away from the Facility), are readmitted to beds reserved 
for them.
(6) Scope-The frequency, incidence, or extent of the occurrence of a finding in 
the facility which may involve as few as one resident. The entire or a large 
percentage of the resident population does not have to be involved. The scope 
may encompass an isolated occurrence, an occasional occurrence, a pattern of 
occurrence, or widespread occurrence.
(7)  Severity-The level of seriousness of a finding considering the actual or 
potential resident harm that did or could occur in that setting in that 
facility. The severity of a finding may range from no resident harm, a potential 
for harm, actual harm with a negative outcome to the resident, to actual life 
threatening harm or resident death.
(8) Threat to health and safety-A situation or condition which represents a 
significant, unfavorable risk or danger to the health and/or safety of patients. 
For the purposes of this section, significant is defined as an occurrence that 
was probably caused by something other than mere chance.
(b) The Texas Department of Human Services (DHS) takes the following action(s) 
when a Title XIX provider agreement facility fails to meet the requirements 
specified in this chapter, as cited in writing by the State Survey Agency, Texas 
Department of Health (TDH).
(1) When the state survey agency notifies DHS in writing that cited 
deficiencies, based on severity and scope, pose an immediate and serious threat 
to residents' health and safety and that the state survey agency is terminating 
or proposing to terminate the facility's certification as a result.
(A) DHS does not offer a compliance period. All termination procedures are 
completed by the state survey agency within 23 calendar days of the exit 
conference.
(B) If a facility makes a creditable allegation that the threat or deficiency 
has been corrected, an on site verification by the state survey agency prior to 
termination will be made, if possible, and the procedure may be reconsidered.
(C) DHS imposes liquidated damages of $5.00 per day, per certified Medicaid bed, 
for every day the facility is out of compliance, beginning with the date of the 
on-site visit exit conference by the TDH/LTCU.
(i) Liquidated damages will cease the same date as decertification or contract 
termination.
(ii) Unless the facility is decertified or its contract is terminated, 
liquidated damages continue for a minimum of 15 days or until the survey agency 
is assured that the deficiencies are corrected, whichever is later. The state 
survey agency may be notified by the facility that the deficiencies were 
corrected, or the state survey agency staff may find on a subsequent visit that 
the deficiencies were corrected. Liquidated damages as described in this section 
will cease on the 16th day or the date of notification to the state survey 
agency, whichever is later, when:
(I) the state surveyors are unable to revisit the facility within five days 
after the date that the facility provided notification that the deficiencies 
were corrected; and
(II) the deficiencies are later shown to be corrected based upon observation and 
written documentation.
(iii) If, on a subsequent visit, the state survey agency determines that the 
deficiencies were in fact not corrected, the state survey agency notifies DHS to 
reinstate the original assessment of liquidated damages until the deficiencies 
are corrected.
(iv)  A facility may request an informal reconsideration and/or an appeals 
hearing. An informal reconsideration must be submitted in writing to Provider 
Services, Texas Department of Human Services, P.O. Box 149030, Austin, Texas 
78714-9030. Appeal procedures involving state statutes, liquidated damages, and 
Title XIX nursing facility contracts are held as specified in sec.79.1605(a) of 
this title (relating to Request for a Hearing)
(v) Termination of certification hearings are held by the state survey agency. 
If a facility requests an appeals hearing, no monetary liquidated damages are 
assessed until the outcome of the hearing.
(vi) Payment of assessed liquidated damages is due in full within 20 days of 
receipt of a certified letter from DHS of the amount of the liquidated damages 
that are assessed based on the outcome of the hearing. Interest on the assessed 
liquidated damages is calculated at the rate of interest in effect during the 
interest period for judgements of the courts of Texas as provided in Texas 
Revised Civil Statutes, Article 5069-1.05, sec.2, and begins on the date of the 
written request by the facility for an appeals hearing and ends on the date the 
liquidated damages are paid.
(vii)  No liquidated damages or interest are charged the facility if the appeals 
hearing results in the administrative law judge or judicial proceeding 
overturning the initial decision.
(viii) DHS applies all funds collected as a result of liquidated damages to the 
protection of the health and property of residents of nursing facilities that 
DHS or Health Care Financing Administration (HCFA) finds deficient. Funds may be 
used for the cost of relocating residents to other facilities, for maintenance 
or operation of a facility pending correction of deficiencies or closure, and 
for reimbursement of residents for lost personal funds.
(D) The state survey agency, at the state survey agency's discretion, may remove 
the immediate and serious threat to health and safety by appointment of a 
temporary manager, as described in subsection (a)(1) of this section.
(E) DHS denies payment for all new Medicaid admissions. DHS gives notice to the 
nursing facility and the public that their facility is no longer in compliance 
with the standards. Public notice of noncompliance will be published in an area 
newspaper. Once the nursing facility is again in compliance, DHS will publish 
notice in an area newspaper.
(F) DHS cancels the facility's provider agreement if the state survey agency 
terminates the facility's certification. DHS makes no payment for services 
provided by the facility after the effective date of the termination of a 
facility's certification. In certain instances, DHS may continue payments for no 
more than 30 days from the date DHS cancels or fails to renew the provider 
agreement. DHS may continue payments if the state survey agency notifies DHS in 
writing that:
(i) reasonable efforts to transfer the residents to another facility or to 
alternate care are being made; and
(ii)  additional time is needed to effect an orderly transfer of the residents.
(G) These rules are not intended to restrict DHS from imposing as necessary 
appropriate remedies for program violations listed in sec.79.2105 of this title 
(relating to Grounds for Fraud Referral and Administrative Sanctions).
(2) When the state survey agency notifies DHS in writing that cited 
deficiencies, based on severity and scope, do not pose an immediate and serious 
threat but are health and/or safety hazards that threaten health and/or safety, 
DHS takes the following actions.
(A) The first time the state survey agency notifies DHS of cited deficiencies, 
based on severity and scope, DHS imposes liquidated damages of $2.50 per day, 
per certified Medicaid bed, for every day the facility is out of compliance, 
beginning with the date of the on-site visit exit conference by the TDH/LTCU.
(i) Liquidated damages will cease the same date as decertification or contract 
termination.
(ii) Unless the facility is decertified or its contract is terminated, 
liquidated damages continue for a minimum of 15 days or until the survey agency 
is assured that the deficiencies are corrected, whichever is later. The state 
survey agency may be notified by the facility that the deficiencies were 
corrected, or the state survey agency staff may find on a subsequent visit that 
the deficiencies were corrected. Liquidated damages as described in this section 
will cease on the 16th day or the date of notification to the state survey 
agency, whichever is later, when:
(I) the state surveyors are unable to revisit the facility within five days 
after the date that the facility provided notification that the deficiencies 
were corrected; and
(II)  the deficiencies are later shown to be corrected based upon observation 
and written documentation.
(iii) If, on a subsequent visit, the state survey agency determines that the 
deficiencies were in fact not corrected, the state survey agency notifies DHS to 
reinstate the original assessment of liquidated damages until the deficiencies 
are corrected.
(iv) DHS also imposes, or authorizes the imposition by the state survey agency 
of, any or all of the following additional actions when recommended by the state 
survey agency in writing:
(I) denial of payment for all new Medicaid admissions. DHS gives notice to the 
nursing facility and the public that the facility is no longer in compliance 
with the standard;
(II) public notice of noncompliance published in an area newspaper. Once the 
nursing facility is again in compliance, DHS will publish a notice in an area 
newspaper;
(III) appointment of a temporary manager, as described in subsection (a) (l) of 
this section, to remove health and/or safety hazards.
(B) The second time the state survey agency notifies DHS of cited deficiencies, 
based on severity and scope, within 18 months of the first notification, DHS 
will impose liquidated damages of $5.00 per day, per certified Medicaid bed for 
every day the facility is out of compliance, beginning with the date of the on-
site visit exit conference by the TDH/LTCU.
(i) Liquidated damages will cease the same date as decertification or contract 
termination.
(ii)  Unless the facility is decertified or its contract is terminated, 
liquidated damages continue for a minimum of 15 days or until the survey agency 
is assured that the deficiencies are corrected, which ever is later. The state 
survey agency may be notified by the facility that the deficiencies were 
corrected, or the state survey agency staff may find on a subsequent visit that 
the deficiencies were corrected. Liquidated damages as described in this section 
will cease on the 16th day or the date of notification to the state survey 
agency, whichever is later, when:
(I) the state surveyors are unable to revisit the facility within five days 
after the date that the facility provided notification that the deficiencies 
were corrected; and
(II) the deficiencies are later shown to be corrected based upon observation and 
written documentation.
(iii) If, on a subsequent visit, the state survey agency determines that the 
deficiencies were in fact not corrected, the state survey agency notifies DHS to 
reinstate the original assessment of liquidated damages until the deficiencies 
are corrected.
(iv) DHS also imposes or authorizes the imposition by the state survey agency of 
any or all of the following actions when recommended by the state survey agency 
in writing:
(I) denial of payment for all new Medicaid admissions. DHS gives notice to the 
nursing facility and the public that the facility is no longer in compliance 
with the standard;
(II) public notice of noncompliance published in an area newspaper. Once the 
nursing facility is again in compliance, the DHS will publish notice in an area 
newspaper;
(III) appointment of a temporary manager, as described in subsection (a)(l) of 
this section, to remove health and/or safety hazards.
(c) The third time the state survey agency notifies DHS of cited deficiencies, 
based on scope and severity, within 18 months of the first notification, DHS 
will terminate the provider agreement.
(d) A facility may request an informal reconsideration and/or an appeals 
hearing. An informal reconsideration must be submitted in writing to Provider 
Services, Texas Department of Human Services, P.O. Box 149030, Austin, Texas 
78714-9030. Appeal procedures involving state statutes, liquidated damages, and 
Title XIX nursing facility contracts are held as specified in sec.79.1605(a) of 
this title (relating to Request for a Hearing). Termination of certification 
hearings are held by the state survey agency.
(1) If a facility requests an appeals hearing, no monetary liquidated damages 
are assessed until the outcome of the hearing. Interest on the assessed 
liquidated damages is calculated at the rate of interest in effect during the 
interest period for judgements of the courts of Texas as provided in Texas Civil 
Statutes, Article 5069-1.05, sec.2, and begins on the date of the written 
request by the facility for an appeals hearing and ends on the date the 
liquidated damages are paid.
(2) No liquidated damages or interest are charged the facility if the appeals 
hearing results in the administrative law judge or judicial proceeding 
overturning the initial decision. DHS applies all funds collected as a result of 
liquidated damages to the protection of the health and property of residents of 
nursing facilities that DHS or Health Care Financing Administration (HCFA) finds 
deficient. Funds may be used for the cost of relocating residents to other 
facilities, maintenance or operation of a facility pending correction of 
deficiencies or closure, and for reimbursement of residents for lost personal 
funds.
(e) If the facility appeals an adverse action by DHS and the adverse action is 
sustained by an administrative law judge or judicial proceeding, the effective 
date of the provider agreement cancellation is the date specified in the notice 
of contract cancellation. Unless otherwise provided in this section, DHS makes 
no payment for services provided by the facility after the effective date of the 
facility's provider agreement termination. In certain instances, DHS may 
continue payments for no more than 30 days from the date DHS terminates or fails 
to renew the provider contract. DHS may continue payments if the state survey 
agency notifies DHS in writing that:
(1) reasonable efforts to transfer the residents to another facility or to 
alternate care are being made; and
(2)  additional time is needed to effect an orderly transfer of the residents.
(f) If the state survey agency determines, on three consecutive standard 
surveys, that a nursing facility is providing substandard quality of care, DHS 
may request the state survey agency to carry out on-site monitoring of the 
facility, on a regular basis, as needed, until the facility has demonstrated 
that it is in compliance with the standards for participation and that it will 
remain in compliance.
(g) These rules are not intended to restrict DHS from imposing as necessary 
appropriate remedies for program violations listed in sec.79.2105 of this title 
(relating to Grounds for Fraud Referral and Administrative Sanctions).
(h) When a facility's provider agreement is cancelled by DHS under the 
provisions of this section and after a mandatory 30-day period of no vendor 
payment to the facility, DHS may enter into a probationary provider agreement 
with the facility, as specified in sec.19.2005(a) (4) of this title (relating to 
Contract Requirements). DHS may enter into this provider agreement after the 
state survey agency conducts an on site, follow-up visit and notifies DHS that 
the deficiencies that caused the cancellation of the contract are no longer in 
effect.
(i) After the probationary provider agreement period, DHS may enter into a 
nonprobationary provider agreement as specified in sec.19.2005(a)(1), (2),(3), 
or (5). DHS may enter into this provider agreement only after the state survey 
agency conducts an on-site, follow-up visit and notifies DHS that the 
deficiencies that caused the cancellation of the provider agreement are no 
longer in effect and the facility is otherwise complying with Medicaid policy.
(j) DHS takes the action(s) specified in paragraph (2) of this section when a 
Title XIX provider agreement facility fails to meet the requirements specified 
in these standards, other applicable agency rules, or contractual provisions 
cited in writing by DHS or the state survey agency that are not specified in 
subsection (b) of this section.
(1) Vendor hold. Vendor hold is not applicable to subsection (b) of this 
section. Vendor hold is used for such areas as:
(A) trust fund violations;
(B) delayed cost reports; and
(C) occupancy report.
(2) DHS administrative citations.
(A) DHS may grant the facility a compliance period of no more than 30 days to 
correct deficiencies cited by DHS. If DHS determines that cited deficiencies are 
not corrected, but determines that the facility has made substantial progress 
toward correcting the cited deficiencies, DHS may extend the compliance period 
for a maximum of 15 days. One compliance extension may be granted.
(B) If deficiencies cited by DHS are not corrected within the compliance period, 
DHS imposes vendor hold on state Medicaid payments to the facility.
(C) If cited deficiencies are not corrected within 60 days from the date the 
facility is placed on vendor hold, DHS cancels the facility's provider agreement 
for breach of contract. A facility may request an informal reconsideration 
and/or an appeal hearing. An informal reconsideration must be submitted in 
writing to Provider Services, Texas Department of Human Services, P.O. Box 
149030, Austin, Texas 78714-9030. Appeal procedures involving state statutes, 
liquidated damages, and Title XIX nursing facility provider agreements are held 
as specified in sec.79. 1605(a) of this title (relating to Request for a 
Hearing). If the facility appeals an adverse action by DHS and the adverse 
action is sustained by an administrative law judge or judicial proceeding, the 
effective date of the provider agreement cancellation is the date specified in 
the notice of provider agreement cancellation. Unless otherwise provided for in 
this section, DHS makes no payment for services provided by the facility after 
the effective date of the facility's contract termination. In certain instances, 
DHS may continue payments for no more than 30 days from the date DHS terminates 
or fails to renew the provider agreement. DHS may continue payments if the state 
survey agency notifies DHS in writing or DHS determines that:
(i) reasonable efforts to transfer the residents to another facility or to 
alternate care are being made; and
(ii) additional time is needed to effect an orderly transfer of the residents.
(k) A facility must not charge Title XIX resident-patients, their families, or 
their responsible parties to recoup any vendor payments not received because of 
the imposition of remedies against the facility. The facility may collect only 
the applied income established in the resident's payment plan.
(l) When the Health Care Financing Administration (HCFA) notifies DHS that HCFA 
is denying payment for new admissions to a Medicare-participating skilled 
nursing facility that also participates in Medicaid, DHS denies Medicaid 
payments for new admissions for the same period for which Medicare payments are 
denied, as stipulated in 42 Code of Federal Regulations, Part 489.
(m) At the time a nursing facility seeks admission into the Medicaid program by 
a request to contract, the Texas Department of Human Services will determine the 
need for individual reinstatement. The determination is based on:
(1) accessibility of other health care to the resident population in the 
immediate and surrounding locale. For purposes of this part, immediate and 
surrounding locale is defined as within the same city, same county, or adjoining 
counties; and
(2)  previous conduct of the individual provider, corporation, owners, officers, 
directors, or employees during participation in the Medicare or Medicaid program 
in Texas or in any other states, and any conduct or action for which a sanction 
as described in these sections could have been taken.
(n) The state survey agency review/appeals procedures are as follows.
(1) The state survey agency provides certified nursing facilities the C 
opportunity to request an informal administrative review for the purpose of 
determining the validity of the findings of the surveyor. The nursing facility 
submits additional information or a written request for a conference with the 
regional survey team/program administrator within five workdays after the 
facility's exit conference. Additional information will not be accepted, nor 
will a conference be scheduled after the fifth workday. The surveyor/team in 
conjunction with the regional program administrator:
(A) reviews additional written information and makes an objective decision;
(B) schedules any meetings requested by providers;
(C) notifies providers in writing of survey team/program administrator's 
decision; and
(D) removes invalid deficiencies; changes certification action if indicated; and 
adds, changes, or deletes liquidated damages, if indicated.
(2) The Texas Department of Health's (TDH) chief, Bureau of Long-Term Care, and 
division directors will receive the decision of the surveyor/team. If the 
provider is not in agreement with the findings of the surveyor/team, the 
provider may request a further review. Based on this request, the TDH chief, 
Bureau of Long-Term Care, and the division directors:
(A) review additional information and/or hold a conference with the provider to 
determine whether deficiencies and/or punitive action recommendations should be 
changed;
(B) change or sustain the deficiencies, certification action, or liquidated 
damage; and
(C)  notify the provider, in writing, within 10 workdays of receipt of 
additional written information or conference, of their decision.
(3)  Determinations of certification and decertification may be appealed if the 
provider is not in agreement with the decisions of the informal administrative 
review. The state survey agency will notify the providers of their right to a 
formal appeal under 25 TAC sec.sec.145.141-145.147 (relating to Procedures 
Covering Certification and Termination of Certification of Long Term Care 
Facilities which Participate in the Title XIX Medical Assistance Program).
Issued in Austin, Texas, on October 27, 1991.
TRD-9113276
Nancy Murphy
Agency liaison, Policy and Document Support
Texas Department of Human Services
Effective date: November 1, 1991
Expiration date: February 29, 1992
For further information, please call: (512) 450-3765