Proposed Sections
Before an agency may permanently adopt a new or amended section, or repeal an 
existing section, a proposal detailing the action must be published in the Texas 
Register at least 30 days before any action may be taken. The 30-day time period 
gives interested persons an opportunity to review and make oral or written 
comments on the section. Also, in the case of substantive sections, a public 
hearing must be granted if requested by at least 25 persons, a governmental 
subdivision or agency, or an association having at least 25 members.
Symbology in proposed amendments. 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 16. ECONOMIC REGULATION
Part VIII. Texas Racing Commission
Chapter 303. General Provisions
Subchapter A. Organization of the Commission
16 TAC sec.303.9
The Texas Racing Commission proposes an amendment to sec.303.9, concerning 
records. The amendment requires all applications for a license under the Texas 
Racing Act to be maintained and made available for public inspection.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that the records of the Texas Racing Commission are 
maintained in accordance with state law. There will be no effect on small 
businesses as a result of enforcing the section. There is no anticipated 
economic cost to persons who are required to comply with the section as 
proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and under sec.2.15, which 
requires all applications for licenses to be maintained and made available for 
public inspection.
sec.303.9. Records.
(a)-(e) (No change.)
<nl>(f) The commission shall maintain all applications for a license under the 
Act and shall make the applications available for public inspection during 
regular office hours.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113526
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.303.10
The Texas Racing Commission proposes an amendment to sec.303.10, concerning 
investigatory files. The amendment clarifies whether the commission's 
investigatory files are subject to public disclosure.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that the commission's records are maintained in 
accordance with state law. There will be no effect on small businesses as a 
result of enforcing the section. There is no anticipated economic cost to 
persons who are required to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.sec.2.15, 2.16, and 
5. 04, which state the requirements regarding the commission's investigatory 
files and criminal history information.
sec.303.10. Investigatory Files.
(a) (No change.)
(b) The contents of an investigatory file are not public records and are 
confidential, except in a criminal proceeding <nl>,<ol> [or] in a hearing 
conducted by the commission<nl>, on court order, or with the consent of the 
party being investigated <ol>.
<nl>(c) Information that is in a form available to the public is not privileged 
or confidential and is subject to public disclosure.
<nl>(d) The commission shall maintain all applications for a license under the 
Act and shall make the applications available for public inspection during 
regular office hours.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113527
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Subchapter B. Powers and Duties of the Commission
16 TAC sec.303.32
The Texas Racing Commission proposes an amendment to sec.303.32, concerning 
power of entry. The amendment authorizes a commission investigator to have power 
of entry into a racetrack's place of business.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that the laws relating to pari-mutuel racing are 
adequately enforced. There will be no effect on small businesses as a result of 
enforcing the section. There is no anticipated economic cost to persons who are 
required to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.3.03, which states 
the persons who have power of entry into a racetrack's place of business.
sec.303.32. Power of Entry.
(a) A member of the commission, a <nl>commission investigator or other<ol> 
person authorized by the commission, a commissioned officer of the Department of 
Public Safety, or a peace officer of the local jurisdiction in which the 
association maintains a place of business may enter an office, racetrack, or 
other place of business of an association at any time to enforce or administer 
the Act.
(b)-(c) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113528
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.303.33
The Texas Racing Commission proposes an amendment to sec.303.332, concerning 
subpoenas. The amendment permits the executive secretary and examiners to issue 
subpoenas.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that the administrative proceedings of the 
commission are conducted efficiently and effectively. There will be no effect on 
small businesses as a result of enforcing the section. There is no anticipated 
economic cost to persons who are required to comply with the section as 
proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing wagering and 
for administering the Texas Racing Act; and sec.3.05, which grants subpoena 
power to the commission.
sec.303.33. Subpoenas.
(a) A member of the commission<nl>, the executive secretary, and examiner, <ol> 
or <nl>other<ol> [a] person authorized by the commission, in performing duties 
under the Act, may take testimony and may require by subpoena the attendance of 
witnesses and the reproduction of books, records, papers, correspondence, and 
other documents that the commission considers advisable.
(b) Subpoenas must be issued under the signature of the commission<nl>, the 
executive secretary, and examiner,<ol> or <nl>other<ol> [a] person authorized by 
the commission and may be served by any person designated by the commission.
(c) A member of the commission<nl>, the executive secretary, an examiner, <ol> 
or <nl>other<ol> [a] person authorized by the commission may administer an oath 
affirmation to a witness appearing before the commission or a person authorized 
by the commission.
(d) If a subpoena issued on behalf of the commission is disobeyed, the 
commission or <nl>executive secretary <ol> [a person authorized by the 
commission] may invoke the aid of the appropriate state court in requiring 
compliance with the subpoena.
(e) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113529
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.303.35
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Racing 
Commission or in the Texas Register office, Room 245, James Earl Rudder 
Building, 1019 Brazos Street, Austin.)
The Texas Racing Commission proposes the repeal of sec.303.35, concerning 
appointment of racetrack officials. The section is proposed for repeal because 
of recent legislative action which changed the method for appointing racetrack 
officials.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the repeal is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the repeal.
Ms. Carter also has determined that for each year of the first five years the 
repeal is in effect the public benefit anticipated as a result of enforcing the 
repeal will be the assurance that the rules of the commission are consistent 
with the applicable state laws. There will be no effect on small businesses. 
There is no anticipated economic cost to persons who are required to comply with 
the repeal as proposed.
Comments on the proposal may be submitted to Paula Cochran Carter, General 
Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711.
The repeal is proposed under Texas Civil Statutes, Article 179e, sec.3.02, which 
authorize the commission to adopt rules for conducting racing with wagering and 
for administering the Texas Racing Act.
sec.303.35. Appointment of Racetrack Officials.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113603
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.303.41
The Texas Racing Commission proposes an amendment to sec.3093.41, concerning 
allocation of race dates. The amendment clarifies the procedure for applying for 
and granting race dates to pari-mutuel racetracks.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that pari-mutuel racing is conducted with utmost 
integrity. There will be no effect on small businesses as a result of enforcing 
the section. There is no anticipated economic cost to persons who are required 
to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.8.01, and 
sec.10.01, which authorize the commission to grant race dates.
sec.303.41. Allocation of Race Dates.
(a) The commission shall allocate <nl>live <ol> race dates, including charity 
days, to each association in accordance with the Act <nl>and this section<ol>. 
<nl>An association shall apply to the commission not later than July 1 of each 
year for live race dates to be conducted in the next calendar year. The 
application must describe the live race dates the association is requesting and 
include evidence regarding the operating experience of the racetrack association 
in this state, including the financial condition of the racetrack and the 
association's willingness and ability to comply and past performance in 
complying with the necessary rules and provisions of the Act. A horse racetrack 
association must also include evidence of negotiations with the official breed 
registries to accord reasonable access to races for all breeds of horses. The 
association shall serve a copy of the request on every association licensed to 
conduct racing for the same species of race animal as the association. After the 
request is filed, the executive secretary may require the association to submit 
additional information if the executive secretary determines the additional 
information is necessary to effectively evaluate the request. The burden of 
proof is on the association to demonstrate that the granting of the live race 
dates will be in the public interest and achieve the purposes of the Act.
(b) In allocating race dates under this section, the commission may consider the 
following factors and the degree to which the association's proposed race 
meeting will serve to nurture, promote, develop, or improve the horse or 
greyhound industry in Texas.
(1) the association's current <nl>ability to pay all fees and other amounts owed 
to the commission, to the state, and to local governments <ol> [financial 
stability];
(2)-(4) (No change.)
(5) the <nl>live<ol> [proposed] race dates requested by other associations 
licensed  <nl>to conduct races for the same species of animal <ol> [in the same 
category of license];
(6)-(8) (No change.)
(9) the anticipated effect of the race meeting on the tourist, recreation, and 
entertainment industries in Texas; [and]
(10) the anticipated effect of scheduled race meetings in neighboring race 
states on the proposed race meeting<nl>; and
<nl>(11) the anticipated availability of race animals for the race meetings.
(c)-(e) (No change.)
<nl>(f) The executive secretary may permit an association to file a request for 
additional live race dates after its request under this section has been acted 
on by the commission if the executive secretary determines that:
<nl>(1) the request includes evidence that granting the additional live race 
dates will enhance the breeding and training industries for horse or greyhounds;
<nl>(2) the association's failure to request the live race dates initially was 
not due to the association's neglect;
<nl>(3) if the request duplicates a request by the association that has already 
been acted on the commission, changed circumstances exist that necessitate 
additional consideration by the commission.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113530
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.303.42
The Texas Racing Commission proposes an amendment to sec.303.42, concerning 
approval of charity race days. The amendment clarifies the procedures for 
applying for and conducting charity race days.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that pari-mutuel racing is conducted with the utmost 
integrity and ultimate benefit to the public. There will be no effect on small 
businesses as a result of enforcing the section. There is no anticipated 
economic cost to persons who are required to comply with the section as 
proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.8.02 and sec.10.01, 
which authorize the commission to grant charity race dates.
sec.303.42. Approval of Charity Race Days.
(a) An association shall conduct charity days as required by the <nl>Act.<ol> 
[commission. Before conducting a charity race day, an association must receive 
the approval of the commission.] <nl>A greyhound association shall conduct at 
least five charity race days each year. A Class 1 or Class 2 horse racetrack 
shall conduct at least two and not more than five charity race days each year.
(b) <nl>An association shall apply to the commission not later than July 1 of 
each year for charity race dates to be conducted in the next calendar year.<ol> 
[To receive approval of a charity race day, an association shall file a request 
not later than 45 days before the first day of the race meeting in which the 
proposed race day is to be conducted.] The <nl>application<ol> [request] must be 
in writing and contain:
(1)-(4) (No change.)
(c) An association shall pay to the charity[, out of its share of the pari-
mutuel handle,] at least 2.0% of the total pari-mutuel handle generated on the 
charity race day.
(d) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113531
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Subchapter C. Powers and Duties of the Comptroller of Public Accounts
16 TAC sec.303.64
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Racing 
Commission or in the Texas Register office, Room 245, James Earl Rudder 
Building, 1019 Brazos Street, Austin.)
The Texas Racing Commission proposes the repeal of sec.303.64, concerning 
compliance. The section is proposed for repeal because of recent legislative 
action which changed the responsibilities of the Comptroller of Public Accounts 
regarding notification of the Texas Racing Commission on compliance issues.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the repeal is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the repeal.
Ms. Carter also has determined that for each year of the first five years the 
repeal is in effect the public benefit anticipated as a result of enforcing the 
repeal will be the assurance that the rules of the commission are consistent 
with the applicable state laws. There will be no effect on small businesses. 
There is no anticipated economic cost to persons who are required to comply with 
the repeal as proposed.
Comments on the proposal may be submitted to Paula Cochran Carter, General 
Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711.
The repeal is proposed under Texas Civil Statutes, Article 179e, sec.3.02, which 
authorize the commission to adopt rules for conducting racing with wagering and 
for administering the Texas Racing Act.
sec.303.64. Compliance.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113604
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Subchapter D. Texas Bred Incentive Programs
General Provisions
16 TAC sec.303.81
The Texas Racing Commission proposes an amendment to sec.303.81, concerning 
Texas-bred incentive programs. The amendment requires the official state breed 
registries to develop programs to distribute money made available to the breed 
registries under the Texas Racing Act.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that the Texas-bred incentive programs are administered 
with the utmost integrity and pari-mutuel racing will benefit the horse and 
greyhound breeding industries. The effect on small businesses resulting from the 
enforcement of the section cannot be determined because the costs of developing 
a Texas-bred incentive program will vary, depending on the breed of horse and 
species of animal involved. There is no anticipated economic cost to persons who 
are required to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.6.08 and sec.6.09, 
which authorize the commission to adopt rules relating to the Texas-bred 
incentive programs.
sec.303.81. Texas-Bred Incentive Programs.
(a) (No change.)
(b) <nl>Each official state breed registry designated in the Act shall develop a 
program, which is subject to the approval of the executive secretary, for 
distributing the funds available to the registry for breeding incentive 
awards.<ol> The executive secretary shall develop a system of communication with 
the reporting by the various state breed registries to ensure that the 
appropriate monies are distributed in a timely fashion to the persons who are 
entitled to receive the monies.
(c) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113532
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
General Provisions
16 TAC sec.303.83
The Texas Racing Commission proposes an amendment to sec.303.83, concerning 
audits and financial reports. The amendment clarifies the duties of the official 
state breed registries regarding the payment of funds made available under the 
Texas Racing Act.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that the Texas-bred incentive programs are administered 
with the utmost integrity and pari-mutuel racing will benefit the horse and 
greyhound breeding industries. There will be no effect on small businesses as a 
result of enforcing the section. There is no anticipated economic cost to 
persons who are required to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.6.08 and sec.6.09, 
which authorized the commission to adopt rules relating to the Texas-bred 
incentive programs.
sec.303.83. Audits and Financial Reports.
(a) <nl>An official state breed registry shall expend the funds available to it 
under the Act in the manner required by law.<ol> The commission may require or 
conduct an audit of the financial records of a breed registry <nl>to ensure the 
breed registry is complying with the applicable law<ol> [recognized by the 
commission].
(b) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113533
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.303.85
The Texas Racing Commission proposes an amendment to sec.303.85, concerning 
background investigations. The amendment authorizes the commission to require a 
background investigation for any person administering a Texas-bred incentive 
program.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that the Texas-bred incentive programs are 
administered with the utmost integrity and pari-mutuel racing will benefit the 
horse and greyhound breeding industries. There will be no effect on small 
businesses. There is no anticipated economic cost to persons who are required to 
comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.6.08 and sec.6.09, 
which authorize the commission to adopt rules relating to the Texas-bred 
incentive programs.
sec.303.85. Background Investigations.
[(a)] The commission may require the officers<nl>, <ol> [or] directors<nl>, or 
managers<ol> of an official breed registry  <nl>or other persons administering a 
Texas-bred incentive program <ol> [or other organization recognized by the 
commission] to submit to a background investigation conducted by the Department 
of Public Safety or the commission.
[(b)] The commission may condition the organization's recognition by the 
commission on a satisfactory report on the investigation.]
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113534
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Programs for Horses
16 TAC sec.303.91
The Texas Racing Commission proposes an amendment to sec.303.91, concerning 
horse breed registries. The amendment designates the official breed registries 
for Appaloosa, Arabian, and paint horses.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that the rules of the Texas Racing Commission are 
consistent with the Texas Racing Act. There will be no effect on small 
businesses. There is no anticipated economic cost to persons who are required to 
comply with the sections as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and to administer the Texas Racing Act; and sec.6.08 and sec.9.02, 
which designate the official state horse breed registries.
sec.303.91. Horse Breed Registries.
(a)-(b) (No change.)
(c) <nl>The official breed registry for Appaloosa horses is the Texas Apaloosa 
Horse Club<ol> [The commission shall designate the official breed registry for 
other breeds of race horses].
<nl>(d) The official breed registry for Arabian horses is the Texas Arabian 
Breeders Association.
<nl>(e) The official breed registry for paint horses is the Texas Paint Horse 
Breeders Association.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113551
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.303.94
The Texas Racing Commission proposes new sec.303.94, concerning Arabian horse 
rules. The new section adopts by reference the rules of the Texas Arabian 
Breeders Association regarding the Texas-bred Incentive program.
Paula Cochran Carter, general counsel, for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that pari-mutuel racing will result in a benefit 
to the horse breeding industry. There will be no effect on small businesses. 
There is no anticipated economic cost to persons who are required to comply with 
the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The new section is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and to administer the Texas Racing Act; and sec.9.01, which require 
rules of the official breed registries to be approved by the Texas Racing 
Commission.
sec.303.94. Arabian Horse Rules. The commissioners adopts by reference the rules 
of the Texas Arabian Breeders Association regarding the administration of the 
Texas-bred Incentive Program for Arabian horses. Copies of these rules are 
available at the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711, 
or at the commission office at 9420 Research Boulevard, Echelon III, Suite 200, 
Austin, Texas.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113552
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.303.95
The Texas Racing Commission proposes an amendment to sec.303.95, concerning 
sufficient competition. The amendment clarifies the requirements of a pari-
mutuel racetrack regarding the running of races limited to accredited Texas-bred 
horses.
Paula Cochran Carter, general counsel, for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that pari-mutuel racing will result in a benefit 
to the horse breeding industry. There will be no effect on small businesses as a 
result of enforcing the section. There is no anticipated economic cost to 
persons who are required to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and to administer the Texas Racing Act; and sec.9.03, which states the 
requirements of pari-mutuel racetracks regarding the running of races limited to 
accredited Texas-bred horses.
sec.303.95. <nl>Races for Accredited Texas-Bred Horses  [Sufficient 
Competition].
(a) The commission finds that, pursuant to the Texas Racing Act, Texas Civil 
Statutes, Article 179e, sec.9.03,  <nl>except as otherwise provided by this 
section,<ol> on each race day, an association shall provide for the running of 
at least two races limited to accredited Texas-bred horses<nl>, of which shall 
be restricted to maidens<ol>. <nl>Before January 1, 1994, if<ol> [If] on any 
race day not enough horses are entered in <nl>an accredited Texas-bred race<ol> 
[this class] to provide sufficient competition, the association shall provide 
for the running of [at least] two races <nl>in which<ol> [limited to] accredited 
Texas-bred horses <nl>are preferred<ol> [and Texas-owned horses]. <nl>An 
association may defer, with the approval of the executive secretary, the running 
of one or both of the two races required by this section for each race day, but 
the association must provide that the total number of accredited Texas-bred 
races in a race meeting is equal to twice the total number of race dates in the 
race meeting.<ol> [If on any race day not enough horses are entered in those 
classes to provide sufficient competition, the association may, with the 
approval of the executive secretary, eliminate those races and provide 
substitute races. A Texas-bred horse that is eligible under the conditions of a 
substitute race provided under this section shall be preferred.]
(b) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113553
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.303.96
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Racing 
Commission or in the Texas Register office, Room 245, James Earl Rudder 
Building, 1019 Brazos Street, Austin.)
The Texas Racing Commission proposes the repeal of sec.303.96, concerning 
participation in certain organizations. The section is proposed for repeal of 
recent legislative action which deleted language relating to the use of certain 
funds for participation in horse racing organizations.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the repeal is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the repeal.
Ms. Carter also has determined that for each year of the first five years the 
repeal is in effect the public benefit anticipated as a result of enforcing the 
repeal will be the assurance that the rules of the commission are consistent 
with the applicable state laws. There will be no effect on small businesses. 
There is no anticipated economic cost to persons who are required to comply with 
the repeal as proposed.
Comments on the proposal may be submitted to Paula Cochran Carter, General 
Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711.
The repeal is proposed under Texas Civil Statutes, Article 179e, sec.3.02, which 
authorize the commission to adopt rules for conducting racing with wagering and 
for administering the Texas Racing Act.
sec.303.96. Participation in Certain Organizations.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113606
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Chapter 305. Licenses for Pari-mutuel Racing
Subchapter A. General Provisions
16 TAC sec.305.5
The Texas Racing Commission proposes an amendment to sec.305.5, concerning 
fingerprints. The amendment clarifies the procedure for giving new fingerprints 
when renewing a license.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that pari-mutuel racing is conducted with the 
utmost integrity and that the licensing program of the commission is operated 
efficiently and effectively. There will be no effect on small businesses. There 
is no anticipated economic cost to persons who are required to comply with the 
section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.5.03, which 
authorize the commission to obtain fingerprints from license applicants.
sec.305.5. Fingerprints.
(a)-(d) (No change.)
<nl>(e) A person who desires to renew an individual license and who has not held 
a current license in this state during the 12-month period preceding the date of 
the renewal application must provide a complete set of fingerprints for 
classification by the Federal Bureau of Investigation.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113535
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.305.13
The Texas Racing Commission proposes an amendment to sec.305.13, concerning 
effect of acceptance. The amendment clarifies that by accepting a license issued 
by the commission, a licensee consents to testing for alcohol.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that pari-mutuel racing is conducted safely and 
with utmost integrity. There will be no effect on small businesses. There is no 
anticipated economic cost to persons who are required to comply with the section 
as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.14.03, which states 
acceptance of a license constitutes consent to a search for drugs, chemicals, or 
other substances.
sec.305.13. Effect of Acceptance. By accepting a license issued by the 
commission, a person consents to:
(1)-(2) (No change.)
(3) testing for <nl>alcohol and <ol> controlled substances in accordance with 
Chapter 311 of this title (relating to Conduct and Duties of Individual 
Licensees).
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113536
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Subchapter B. Individual Licenses
General Provisions
16 TAC sec.305.35
The Texas Racing Commission proposes an amendment to sec.305.35, concerning 
license fees. The amendment establishes the fees for occupational licenses 
issued in 1992.
Paula Cochran Carter, general counsel, for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that the licensing program of the commission is 
funded as required by state law. There will be no effect on small businesses as 
a result of enforcing the section. Anticipated economic cost to persons who are 
required to comply with the section as proposed varies depending on the type of 
license desired. The license fees range from $10 to $75.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Carla Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.7.05, which 
requires the commission to adopt a fee schedule for occupational licenses.
 [graphic]
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113567
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Specific Licensees
16 TAC sec.305.42
The Texas Racing Commission proposes an amendment to sec.305.42, concerning 
owners. The amendment clarifies the requirements for being licensed as the owner 
of a race animal.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that the licensing program of the commission is 
conducted efficiently and effectively and pari-mutuel racing is conducted with 
utmost integrity. There will be no effect on small businesses. There is no 
anticipated economic cost to persons who are required to comply with the 
section.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.7.02, which 
authorize the commission to specify qualifications for the various categories of 
licenses.
sec.305.42. Owners.
(a) <nl>Except as otherwise provided by this subsection, the<ol> [The] owner of 
each horse or greyhound <nl>, as listed on the animal's registration paper, must 
obtain an owner's license before the horse or greyhound may be<ol> entered in a 
race [in the owner's name must obtain an owner's license issued by the 
commission]. <nl>The owner of each horse or greyhound entered in a stakes race 
must obtain an owner's license before the time designated by the stewards or 
racing judges. A person may not be licensed as an owner if the person is not the 
owner of record of a properly registered race animal which the person intends to 
race in Texas and which is in the care of a trainer licensed by the commission.
(b)-(d) (No change.)
(e) <nl>If the registered owner of a race animal is a minor, a financial 
responsibility form approved by the commission must be signed by the parent or 
guardian of the owner assuming financial responsibility for the debts incurred 
for the training and racing of the race animal <ol> [If the owner is not an 
individual, the owner must report to the commission each change in the identity 
of the individuals who serve as directors, officers, or partners of the owner or 
who have an ownership interest in the race animal of 5.0% or more].
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113537
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.305.43
The Texas Racing Commission proposes an amendment to sec.305.43, concerning 
lessee. The amendment clarifies the requirements for being licensed as the 
lessor of a race animal.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that the licensing program of the commission is 
conducted efficiently and effectively and pari-mutuel racing is conducted with 
utmost integrity. There will be no effect on small businesses. There is no 
anticipated economic cost to persons who are required to comply with the 
section.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.7.02, which 
authorize the commission to specify qualifications for the various categories of 
licenses.
sec.305.43. <nl>Lessee/Lessor  [Lessee].
<nl>(a) A race animal may be raced under lease provided a completed Texas Racing 
Commission, breed registry, or other lease form acceptable to the commission is 
attached to the registration certificated and is on file with the commission. A 
copy of the lease must be provided to the stewards, racing judges, or their 
designee at the time of application for an owner's license.
<nl>(b)[a] The lessee and lessor<ol> of a horse or greyhound for racing purposes 
must obtain an owner's license in accordance with sec.305.42 of this title 
(relating to Owners).
[(b) The lessee must also provide a copy of the lease to the stewards, racing 
judges, or their designee at the time of application for an owner's license.]
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113538
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Subchapter C. Racetrack Licenses
General Provisions
16 TAC sec.305.68
The Texas Racing Commission proposes an amendment to sec.305.68, concerning 
greyhound racetrack fees. The amendment clarifies the procedure for the payment 
of the annual fee for a greyhound racetrack license.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that the licensing program of the commission is 
operated efficiently and effectively and is funded in accordance with state law. 
There will be no effect on small businesses. There is no anticipated economic 
cost to persons who are required to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and to administer the Texas Racing Act; and sec.5.01 and sec.6.18 which 
authorize the commission to impose annual fees on racetrack licensees.
sec.305.68. Greyhound Racetrack Fees.
(a) The annual [renewal] fee for a greyhound racetrack license is composed of a 
<nl>base fee and a daily fee, based on the handle for each performance conducted 
by the association<ol> [fixed charge and a variable charge and a variable 
charge. The fixed charge is the amount set to cover the costs of administering 
the enforcing the licensing program of the commission. The variable charge is 
based on the costs assessed by the commission to cover the costs of compensating 
racetrack officials to serve at the association's race meetings. The commission 
will bill the association weekly for the variable charge, which is due not later 
than three business days after the billing is received by the association.]
(b) The <nl>base fee<ol> [base rate portion of the fixed charge] is due <nl>on 
September 1 of each year<ol> [not later than 10 business days after the date the 
commission order renewing the racetrack's license is final and appealable]. The  
<nl>base fee<ol> [base rate portion of the fixed charge] for a greyhound 
racetrack is $25,000.
(c) The <nl>daily fee<ol> [balance of the fixed charge is an amount based on the 
handle for each performance conducted by the association. The amount] is due and 
payable to the commission not later than 10 a.m. on the next banking day after 
each allocated performance. The amount is:
(1)-(5) (No change.)
(d) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113561
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.305.69
The Texas Racing Commission proposes an amendment to sec.305.69, concerning 
horse racetrack application and initial license fees. The amendment clarifies 
the requirements for filing application fees for horse racetrack licenses and 
adds application and initial license fees for a Class 4 racetrack.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for local government as a result of enforcing or 
administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that the licensing program of the Texas Racing 
Commission is funded in accordance with state law. As a result of enforcing the 
section, an applicant for a Class 4 license will be required to pay $3,500 in 
application fees and $1,250 as a initial license fee. There is no anticipated 
economic cost to persons who are required to comply with the section as 
proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and to administer the Texas Racing Act; and sec.5.01 and sec.6.03 which 
authorize the commission to impose application and license fees.
sec.305.69. Horse Racetrack Application and Initial License Fees.
(a) The application fee for a horse racetrack license is composed of a 
processing charge, a variable investigation charge, and a variable hearing 
charge. The processing charge is the amount set to cover administrative costs. 
The investigation charge is the amount needed by the commission to cover the 
costs incurred by the Department of Public Safety for conducting the background 
investigation on the applicant. The hearing charge is the amount needed by the 
commission to pay for the legal and court reporting services for conducting a 
hearing on the application. An applicant for a horse racetrack license must pay 
<nl>all charges<ol> [the processing charge] on filing the application. <nl>The 
failure to pay the total amount of the application fee may result in the 
application being struck by the commission or a hearing examiner. If the 
application is not certified<ol> [Not later than five business days after 
receiving certification of receipt] under sec.305.85 of this title (relating to 
Review of Application Documents and Certification of Receipt), the 
<nl>commission shall return<ol> [applicant must pay] the investigation charge 
and hearing charge. <nl>If the application is certified under under sec.305.85 
of this title, the<ol> [The] commission shall <nl>hold<ol> [deposit] the 
investigation charge and hearing charge in the state treasury in a suspense 
account. Not later than five business days after the date the commission order 
on the application is final and appealable, the commission shall transfer the 
suspense funds due to the commission to the Texas Racing Commission fund. If the 
cost of the investigation or hearing exceed the amount to the applicable charge, 
the applicant shall pay the remaining amount not later than 10 business days 
after receipt of a bill from the commission. If the costs of the investigation 
or hearing are less than the amount of the charge, the commission shall refund 
the excess not later than 10 days after the commission order on the application 
is final and appealable.
(b) The processing charge for a horse racetrack license application is:
(1) (No change.)
(2) for a Class 2 racetrack, $20,000; [and]
(3) for a Class 3 racetrack, $3,000<nl>; and
<nl>(4) for a Class 4 racetrack, $1,500.
(c) The amount to be deposited for the investigation charge for a horse 
racetrack license application is:
(1) (No change.)
(2) for a Class 2 racetrack, $15,000; [and]
(3) for a Class 3 racetrack, $1,500<nl>; and
<nl>(4) for a Class 4 racetrack, $1,000.
(d) The amount to be deposited for the hearing charge for a horse racetrack 
license application is:
(1) (No change.)
(2) for a Class 2 racetrack, $8,000; [and]
(3) for a Class 3 racetrack, $1,500<nl>; and
<nl>(4) for a Class 4 racetrack, $1,000.
(e) The initial license fee for a horse racetrack license is due not later than 
10 business days after the date the commission order that granted the license 
becomes final and appealable. The initial license fee for a horse racetrack 
license is:
(1) (No change.)
(2) for a Class 2 racetrack, $60,000; [and]
(3) for a Class 3 racetrack, $3,500<nl>; and
<nl>(4) for a Class 4 racetrack, $1,250.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113554
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.305.70
The Texas Racing Commission proposes new sec.305.70, concerning officials' fee. 
The section establishes the amount of fees licensed racetracks must pay to 
reimburse the commission for the costs of compensating certain officials.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that pari-mutuel racing is conducted with utmost 
integrity and the commission is funded as required by law. As a result of 
enforcing the section, a pari-mutuel horse racetrack will be required to pay up 
to $650 per race day and a pari-mutuel greyhound racetrack will be required to 
pay up to $250 per performance. There is no anticipated economic cost to persons 
who are required to comply with the section.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The new section is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.3.07, which 
authorize the commission to charge a fee to offset the costs of compensating 
certain officials.
sec.305.70. Officials's Fee.
(a) An association shall pay a fee for officials provided by the commission. The 
commission shall periodically bill the association for the officials' fee, which 
is due not later than the third business day after the date the billing was 
received by the association.
(b) The officials' fee at a greyhound racetrack is based on the actual cost to 
the commission of compensating the presiding race judge and the commission 
veterinarian. The compensation for these officials is:
(1) for the presiding race judge, $125 per performance; and
(2) for the commission veterinarian, $125 per performance.
(c) The officials' fee at a horse racetrack is based on the actual cost to the 
commission of compensating the presiding steward and the commission 
veterinarians. The compensation for these officials is:
(1) for the presiding steward, $225 per race day, $175 per nonrace day, and $100 
per day of pre-meet licensing;
(2) for the primary commission veterinarian, $225 per race day and $175 per 
nonrace day; and
(3) for the secondary commission veterinarian, $200 per race day and $175 per 
nonrace day.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113539
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.305.71
The Texas Racing Commission proposes an amendment to sec.305.71, concerning 
horse racetrack fees. The amendment clarifies the procedure for paying an annual 
fee for a horse racetrack and adds an annual fee for a Class 4 racetrack.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for local government as a result of enforcing or 
administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that the licensing program of the Texas Racing 
Commission is funded in accordance with state law. As a result of enforcing the 
section, an applicant for a Class 4 license will be required to pay an annual 
fee of $1,250. There is no anticipated economic cost to persons who are required 
to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and to administer the Texas Racing Act; and sec.5.01 and sec.6.18 which 
authorize the commission to impose annual fees on racetrack licensees.
sec.305.71. Horse Racetrack [License Renewal] Fees.
(a) The annual [renewal] fee for a horse racetrack license is composed of a 
<nl>based fee and a daily fee based on the handle for each performance conducted 
by the association <ol> [fixed charge and a variable charge. The fixed charge is 
the amount set to cover the costs of administering and enforcing the licensing 
program of the commission. The variable charge is based on the costs assessed by 
the commission to cover the costs of compensating racetrack officials to serve 
at the association's race meeting. The commission will bill the association 
weekly for the variable charge, which is due not later than three business days 
after the billing is received by the association.]
(b) The base <nl>fee<ol> [rate portion of the fixed charge] is due <nl>on 
September 1 of each year <ol> [not later than 10 business days after the date 
the commission order renewing the racetrack's license is final and appealable.] 
The base <nl>fee<ol> [rate portion of the fixed charge] is:
(1) (No change.)
(2) for Class 2 racetrack, $10,000; [and]
(3) for Class 3 racetrack, $3,500<nl>; and
<nl>(4) for a Class 4 racetrack, $1,250.
(c) The <nl>daily fee<ol> [balance of the fixed charge is a daily amount based 
on the daily handle of the association. The daily amount] is due and payable to 
the commission not later than 10 a.m. on the day after each allocated race day. 
The daily amount is:
(1)-(5) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113555
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Chapter 309. Operation of Racetracks
Subchapter A. General Provisions
Facilities and Equipment
16 TAC sec.309.18
The Texas Racing Commission proposes an amendment to sec.309.18, concerning 
first aid. The amendment clarifies the requirements for a pari-mutuel racetrack 
regarding emergency vehicles and personnel.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that pari-mutuel racing is safe for licensees and 
patrons. The cost to a pari-mutuel racetrack resulting from the enforcement of 
the section will vary, depending on the location of the racetrack, as the costs 
of ambulance services vary with the market area. The cost for having an MICU 
ambulance on standby is expected to be approximately $35-$45 per hour, with 
additional costs for services, equipment, and supplies when the ambulance is 
actually used. There is no anticipated economic cost to persons who are required 
to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.6.06, which 
authorize the commission to adopt rules relating to the operation of racetracks.
sec.309.18. First Aid.
(a) During a race performance, an association shall provide:
(1) (No change.)
(2) the services of <nl>at least one certified paramedic<ol> [a physician 
licensed by the Texas State Board of Medical Examiners and a licensed vocational 
or registered nurse].
(b) A horse racing association shall provide a properly equipped and staffed 
ambulance for humans at any time that the racetrack is open for racing or 
<nl>exercising<ol> [exercise]. <nl>At a Class 1 or 2 racetrack, the primary 
ambulance must be a mobile intensive care unit (MICU) certified by the Texas 
Department of Health.<ol> [The ambulance must be parked at the entrance to the 
racing strip when not in use.] If <nl>the MICU<ol> [an] ambulance is [being] 
used to transport an individual, the association may not conduct a race until 
the ambulance is replaced <nl>by an ambulance approved by the commission<ol>. 
<nl>The ambulance must be parked at the entrance to the racing strip when not 
being used to transport an individual.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113540
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Operations
16 TAC sec.309.51
The Texas Racing Commission proposes an amendment to sec.309.51, concerning 
contracts. The amendment clarifies the procedure for obtaining the approval of 
the commission for contracts relating to the operation of a pari-mutuel 
racetrack.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that pari-mutuel racing is conducted with utmost 
integrity and the commission is advised on all participants in the operation of 
pari-mutuel racetracks. There will be no effect on small businesses as a result 
of enforcing the section. There is no anticipated economic cost to persons who 
are required to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.6.06, which 
authorize the commission to adopt rules relating to the operation of racetracks.
sec.309.51. Contracts.
<nl>(a) An association may not execute a contract regarding the operation of the 
racetrack for which the association is licensed without the prior approval of 
the commission. <nl>This section applies only to:
<nl>(1) a contract, other than an employment contract, for which the amount of 
consideration is $50,000 or more or that is to be executed over a period of 90 
days or more;
<nl>(2) a series of contracts, other than employment contracts, between the 
association and the same contractor for which the total amount of consideration 
of the contracts is $50,000 or more or that are to be executed over a period of 
90 consecutive days or more; and
<nl>(3) a contract for management, concession, or totalisator services.
<nl>(b) A contract that requires approval under this section must be in writing.
<nl>(c) To receive the approval of the commission for a proposed contract 
subject to this section, the association shall submit to the commission a copy 
of the proposed contract and background information on the contractor on a form 
provided by the commission.
<nl>(d) The commission delegates to the commission staff the authority to 
approve all contracts other than contracts for management, concession, or 
totalisator services.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113541
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.309.52
The Texas Racing Commission proposes an amendment to sec.309.52, concerning 
transfer of ownership. The amendment clarifies the procedure for obtaining 
commission approval of changes in ownership, directors, or managers of a pari-
mutuel racetrack.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that pari-mutuel racing is conducted with utmost 
integrity and the commission is advised of all participants in the operation of 
pari-mutuel racetracks. There will be no effect on small businesses as a result 
of enforcing the section. There is no anticipated economic cost to persons who 
are required to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.6.06, which 
authorize the commission to adopt rules relating to the operation of racetracks; 
and  s6.13, which requires all transfers of a pecuniary interest in a pari-
mutuel racetrack to be approved by the commission.
sec.309.52. <nl>Change  [Transfer] of Ownership 23>, Board of Directors, or 
Management Committee.
<nl>(a) An association may not transfer an ownership interest in the association 
<nl>,<ol> [or] grant or sell an option to buy an ownership interest in the 
association<nl>, or make a change in the board of directors or management 
committee of the association<ol> without the prior approval of the commission.
<nl>(b) To receive the approval of the commission for a proposed ownership 
transfer, the association shall submit to the commission all written documents 
relating to the transfer. If there are no written documents relating to the 
transfer, the association shall submit a written summary of all terms of the 
transfer including, but not limited to, the consideration given, the proposed 
date of the transfer, and the terms of any option given for future acquisition 
of additional ownership interests. The association shall also submit the 
following information:
<nl>(1) the transferor's name, total ownership percentage, and the manner in 
which the ownership interest is held, such as through a limited partnership or 
shares of stock in a corporate general partner or association;
<nl>(2) the transferee's name, residence address and telephone number, business 
address and telephone number, date of birth, physical description, driver's 
license number, and social security number;
<nl>(3) the percentage of ownership interest the transferee is acquiring; and
<nl>(4) a complete set of fingerprints and completed background information form 
for the Department of Public Safety, if the transfer results in the acquisition 
of an ownership interest of 5.0% or more in the association by an individual who 
has not previously submitted fingerprints to the commission.
<nl>(c) To receive the approval of the commission for a change in the board of 
directors or management committee, the association shall submit to the 
commission a written request for the change, the names of the individuals 
involved in the change, the percentage of any ownership interest the individuals 
hold in the association, and the proposed date of the change. If the proposed 
change involves placing an individual in the board of directors or management 
committee who has not previously submitted fingerprints to the commission, the 
association shall also submit:
<nl>(1) the individual's name, residence address and telephone number, business 
address and telephone number, date of birth, physical description, driver's 
license number, and social security number; and
<nl>(2) a complete set of fingerprints and completed background information form 
for the Department of Public Safety.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113542
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.309.54
The Texas Racing Commission proposes an amendment to sec.309.54, concerning 
general security. The amendment clarifies the requirements of a pari-mutuel 
racetrack regarding security personnel.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that pari-mutuel racing is safe for the licensees and 
patrons. There will be no effect on small businesses as a result of enforcing 
the section. There is no anticipated economic cost to persons who are required 
to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.6.06, which 
authorize the commission to adopt rules relating to the operation of racetracks.
sec.309.54. General Security.
(a) An association shall secure the peaceful use of the association grounds 
<nl>by proving security personnel that is adequate in number and training. The 
number of security personnel and the level of training required for security 
personnel is subject to the approval of the executive secretary. All security 
personnel, including peace officers providing security services to the 
association, must be individually licensed by the commission.
(b) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113543
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Subchapter B. Horse Racetracks
Facilities for Horses
16 TAC sec.309.151
The Texas Racing Commission proposes an amendment to sec.309.151, concerning 
test barn. The amendment reduces the number of stalls required in a test barn at 
a horse racetrack.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that pari-mutuel racing is conducted safety and with 
utmost integrity. Because the cost of constructing a test barn will vary 
depending on the type and location of the racetrack, the exact cost to a small 
business for complying with the section cannot be determined at this time. 
However, the reduction in the number of stalls should result in a savings to a 
racetrack in the construction of the test barn. There is no anticipated economic 
cost to persons who are required to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.6.06 which 
authorize the commission to adopt rules relating to the construction and 
operation of pari-mutuel racetracks.
sec.309.151. Test Barn.
(a)-(c) (No change.)
(d) The barn must be equipped with:
(1) (No change.)
(2) at least <nl>four<ol> [six] enclosed stalls, equipped with dutch doors and 
observation windows;
(3)-(4) (No change.)
(e)-(f) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113556
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Operations
16 TAC sec.309.199
The Texas Racing Commission proposes an amendment to sec.309.199, concerning 
horsemen's bookkeeper. The amendment clarifies the requirements of the 
horsemen's bookkeeper relating to deductions from the horsemen's accounts.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that pari-mutuel racing is conducted with utmost 
integrity and fairness to all licensees. There will be no effect on small 
businesses as a result of enforcing the section. There is no anticipated 
economic cost to persons who are required to comply with the section as 
proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.6.08 which states a 
limitation on deductions from horsemen's accounts.
sec.309.199. Horsemen's Bookkeeper.
(a)-(d) (No change.)
(e) An association may not deduct <nl>or withhold any percentage of a purse<ol> 
from the [horsemen's] account <nl>into which the purse paid to a horse owner is 
deposited for membership payments, dues, assessments, or any other payments 
except an organization of the horse owner's choice<ol> [any money other than 
jockey fees except on written request from the person in whose name the account 
is held or an authorized agent of that person].
(f) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113557
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.309.201
The Texas Racing Commission proposes an amendment to sec.309.201, concerning 
equitable stabling. The amendment clarifies the requirements of a pari-mutuel 
horse racetrack relating to on-track stabling.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that the rules of the Texas Racing Commission are 
consistent with the Texas Racing Act. There will be no effect on small 
businesses as a result of enforcing the section. There is no anticipated 
economic cost to persons who are required to comply with the section as 
proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administering the Texas Racing Act; and sec.9.06 which states 
the requirements of a pari-mutuel horse racetrack relating to on-track stabling 
of various breeds.
sec.309.201. Equitable Stabling. <ol> If an association conducts <nl>a race 
meeting for more than one breed of horse at one racetrack, the proportion of 
stalls at the racetrack that are allocated for each breed shall be in direct 
proportion to the number of races conducted for each breed during the race 
meeting<ol> thoroughbred and quarter horse races on the same day, the 
association shall make available an equal number of stalls to each breed of 
horses].
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113558
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Chapter 311. Conduct and Duties of Individual Licensees
Subchapter C. Alcohol and Drug Testing
Drugs
16 TAC sec.311.201
The Texas Racing Commission proposes an amendment to sec.311.201, concerning use 
prohibited. The amendment prohibits a licensee other than a veterinarian from 
possessing a dangerous drug or controlled substance while on the grounds of a 
pari-mutuel racetrack.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be the assurance that pari-mutuel racing is safe for the licensees 
and is conducted with utmost integrity. There will be no effect on small 
businesses as a result of enforcing the section. There is no anticipated 
economic cost to persons who are required to comply with the sections as 
proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and for administer the Texas Racing Act and sec.14.03, which authorize 
the commission to adopt rules prohibiting the illegal influencing of a race.
sec.311.201. <nl>Possession and Use Prohibited.
(a) (No change.)
(b)<nl> Except as otherwise provided by this section, an individual licensee may 
not possess, while on association grounds, a dangerous drug as defined by the 
Texas Dangerous Drugs Act, Texas Civil Statutes, Article 4476-14, or a 
controlled substance as defined by the Texas Controlled Substances Act, Texas 
Civil Statutes, Article 4476-15. This subsection does not apply to a 
veterinarian licensed by the commission who has obtained permission to possess a 
controlled substance under  s319.14 of this title (relating to Possession of 
Controlled Substances).
<nl>(c)<ol>[(b)] This section does not apply to the <nl>possession or<ol> use of 
a prohibited substance obtained with a valid prescription by an individual 
licensee under orders of a licensed physician acting in the course of the 
physician's professional practice.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113544
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.311.208
The Texas Racing Commission proposes an amendment to sec.311.208, concerning 
penalties. The amendment clarifies the responsibility for payment of charges for 
drug testing on occupational licensees.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect, there 
will be no fiscal implications for local government as a result of enforcing or 
administering the section. The cost to state government cannot be determined at 
this time, because it will vary depending on the number of human drug tests 
conducted each year.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that pari-mutuel racing is safe for the licensees and 
is conducted with utmost integrity. There will be no effect on small businesses 
as a result of enforcing the section. There is no anticipated economic cost to 
persons who are required to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and to administer the Texas Racing Act and sec.3.07, which authorize 
the commission to adopt rules regarding the approval and payment of laboratory 
charges for human alcohol testing.
sec.311.208. Penalties.
(a)-(f) (No change.)
(g) All specimens to be tested under this subchapter shall be obtained and 
tested by the commission under conditions properly controlled to guarantee the 
integrity of the process. <nl>The charges for tests conducted under this 
subchapter shall be forwarded to the commission for approval as to the 
reasonableness of the charges in relation to industry standards for comparable 
testing procedures. The commission shall pay the cost of the initial test.<ol> 
The licensee being tested is responsible for paying the costs of all tests other 
than the initial test.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113545
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.311.223
The Texas Racing Commission proposes an amendment to sec.311.223, concerning 
penalties. The amendment clarifies the responsibility for payment of charges for 
alcohol testing on occupational licensees.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect, there 
will be no fiscal implications for local government as a result of enforcing or 
administering the section. The cost to state government cannot be determined at 
this time, because it will vary depending on the number of human alcohol tests 
conducted each year.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that pari-mutuel racing is safe for the licensees and 
is conducted with utmost integrity. There will be no effect on small businesses 
as a result of enforcing the section. There is no anticipated economic cost to 
persons who are required to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and to administer the Texas Racing Act and sec.3.07, which authorize 
the commission to adopt rules regarding the approval and payment of laboratory 
charges for human alcohol testing.
sec.311.223. Penalties.
(a)-(d) (No change.)
(e) All specimens to be tested under this subchapter shall be obtained and 
tested by the commission under conditions properly controlled to guarantee the 
integrity of the process. <nl>The charges for tests conducted under this 
subchapter shall be forwarded to the commission for approval as to the 
reasonableness of the charges in relation to industry standards for comparable 
testing procedures. The commission shall pay the cost of the initial test.<ol> 
The licensee being tested is responsible for paying the costs of all tests other 
than the initial test.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113546
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Chapter 313. Officials and Rules of Horse Racing
Subchapter A. Officials
General Provisions
16 TAC sec.313.6
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Racing 
Commission or in the Texas Register office, Room 245, James Earl Rudder 
Building, 1019 Brazos Street, Austin.)
The Texas Racing Commission proposes the repeal of sec.313.6, concerning 
approval of compensation. The section is proposed for repeal because of recent 
legislative action which changed the method for compensating officials.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the repeal is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the repeal. Although under the new legislation the 
Texas Racing Commission is required to employ and compensate certain officials, 
the Commission is also authorized to charge a fee to the racetracks to offset 
the costs of compensating the officials. Therefore, there will be no fiscal 
implications for state government as a result of enforcing or administering the 
repeal for the first five-year period the repeal is in effect.
Ms. Carter also has determined that for each year of the first five years the 
repeal is in effect the public benefit anticipated as a result of enforcing the 
repeal will be the assurance that the rules of the commission are consistent 
with the applicable state laws. There will be no effect on small businesses. 
There is no anticipated economic cost to persons who are required to comply with 
the repeal as proposed.
Comments on the proposal may be submitted to Paula Cochran Carter, General 
Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711.
The repeal is proposed under Texas Civil Statutes, Article 179e, sec.3.02, which 
authorize the commission to adopt rules for conducting racing with wagering and 
for administering the Texas Racing Act.
sec.313.6. Approval of Compensation.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113607
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Subchapter B. Entries, Declarations, and Allowances
Entries
16 TAC sec.313.112
The Texas Racing Commission proposes an amendment to sec.313.112, concerning 
official workouts. The amendment limits the number of official workouts a horse 
may receive on any one day.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that pari-mutuel racing is safe and humane for the race 
animals. There will be no effect on small businesses as a result of enforcing 
the section. There is no anticipated economic cost to persons who are required 
to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and to administer the Texas Racing Act and sec.3.021, which authorize 
the commission to adopt rules relating to the regulation of workouts.
sec.313.112. Official Workouts.
(a)-(j) (No change.)
<nl>(k) A horse may not receive more than one official workout on one calendar 
day.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113559
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Subchapter C. Claiming Races
16 TAC sec.313.302
The Texas Racing Commission proposes an amendment to sec.313.302, concerning 
claim procedure. The amendment changes the deadline for depositing a claim in 
the claim box before a race.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that pari-mutuel racing is conducted with utmost 
integrity and fairness to all licensees. There will be no effect on small 
businesses as a result of enforcing the section. There is no anticipated 
economic cost to persons who are required to comply with the section as 
proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules for conducting racing with 
wagering and to administer the Texas Racing Act and sec.6.06, which authorize 
the commission to adopt rules relating to the operation of pari-mutuel 
racetracks.
sec.313.302. Claim Procedure.
(a)-(c) (No change.)
(d) A claim must be deposited in a locked box provided by the racing secretary 
not later than <nl>15<ol> [10] minutes before post time of the race in which the 
horse being claimed is to start. A person may not place money or its equivalent 
in the claim box.
(e)-(f) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113560
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Chapter 321. Pari-mutuel Wagering
Subchapter A. Regulation and Totalisator Operations
Mutuel Tickets
16 TAC sec.321.32
The Texas Racing Commission proposes an amendment to sec.321.32, concerning 
expiration date. The amendment clarifies the date mutuel tickets expire.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that pari-mutuel racing is conducted with utmost 
integrity. There will be no effect on small businesses as a result of enforcing 
the section. There is no anticipated economic cost to persons who are required 
to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules to regulate racing with pari-
mutuel wagering; sec.11.01, which authorize the commission to adopt rules to 
regulate pari-mutuel wagering; and sec.6.09, and sec.11.07, which state the 
expiration date for mutuel tickets.
sec.321.32. Expiration Date.
(a) A mutuel ticket [purchased for a horse race] expires any may not be cashed 
60 days after the last day of the race meeting in which the ticket was 
purchased.
[(b) A mutuel ticket purchased for a greyhound race expires any may not be 
cashed on or after April 1 of the year after the year in which the ticket was 
purchased.]
<nl>(b)<ol>[(c)] An association may not permit an expired ticket to be cashed.
<nl>(c)<ol>[(d)] For each race meeting, an association shall post in a 
conspicuous place the expiration date of mutuel tickets sold during that 
meeting.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113547
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Chapter 323. Disciplinary Action and Enforcement
Subchapter A. General Provisions
16 TAC sec.323.2
The Texas Racing Commission proposes an amendment to sec.323.2, concerning 
complaints. The amendment clarifies the requirements for filing a complaint with 
the commission.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that the commission's enforcement program is operated 
efficiently and effectively. There will be no effect on small businesses as a 
result of enforcing the section. There is no anticipated economic cost to 
persons who are required to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules to administer the Texas Racing Act 
and sec.3.12, which relates to the reporting of violations of the Texas Racing 
Act or Commission rules.
sec.323.2. Complaints.
(a)-(b) (No change.)
(c) The form must:
(1) (No change.)
(2) specify <nl>the provision of the Act or rule number alleged to have been 
violated and<ol> all facts and circumstances relating to the alleged violation; 
and
(3) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113548
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.323.4
The Texas Racing Commission propose an amendment to sec.323.4, concerning show 
cause hearing. The amendment clarifies the procedure for taking enforcement 
action on a complaint.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that the commission's enforcement program is operated 
efficiently and effectively. There will be no effect on small businesses as a 
result of enforcing the section. There is no anticipated economic cost to 
persons who are required to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules to administer the Texas Racing Act 
and sec.15.04, which relates to the institution of complaints.
sec.323.4. <nl>Action on Complaints [Show Cause Hearing].
(a) on receipt of a complaint under this subchapter, <nl>if the executive 
secretary determines that a violation has occurred,<ol> the executive secretary 
may<nl>, in his sole discretion:
<nl>(1) issue a preliminary report to the licensee assessing an administrative 
penalty;
<nl>(2) or a [show cause] hearing <nl>to suspend or revoke the licensee's 
license based on the alleged violation<ol> [to determine whether a violation has 
occurred]<nl>; or
<nl>(3) take other action that the executive secretary considers advisable, 
considering the severity of the violation.
(b)-(c) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113549
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
16 TAC sec.323.5
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Racing 
Commission or in the Texas Register office, Room 245, James Earl Rudder 
Building, 1019 Brazos Street, Austin.)
The Texas Racing Commission proposes the repeal of sec.323.5, concerning 
commission action. The section is proposed for repeal because of recent 
legislative action which added procedures for imposing administrative penalties 
on licensees.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the repeal is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the repeal.
Ms. Carter also has determined that for each year of the first five years the 
repeal is in effect the public benefit anticipated as a result of enforcing the 
repeal will be the assurance that the rules of the commission are consistent 
with the applicable state laws. There will be no effect on small businesses. 
There is no anticipated economic cost to persons who are required to comply with 
the repeal as proposed.
Comments on the proposal may be submitted to Paula Cochran Carter, General 
Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711.
The repeal is proposed under Texas Civil Statutes, Article 179e, sec.3.02, which 
authorize the commission to adopt rules for conducting racing with wagering and 
for administering the Texas Racing Act.
sec.323.5. Commission Action.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113605
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
Subchapter B. Civil Remedies
16 TAC sec.323.101
The Texas Racing Commission proposes an amendment to sec.323.101, concerning 
civil penalties. The amendment clarifies the procedure for the imposition and 
adjudication of administrative penalties.
Paula Cochran Carter, general counsel for the Texas Racing Commission, has 
determined that for the first five-year period the section is in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section.
Ms. Carter also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section is the assurance that the commission's enforcement program is operated 
efficiently and effectively and pari-mutuel racing is conducted with utmost 
integrity. The cost to a small business as a result of enforcing the section 
could be as much as $10,000 for each violation. There is no anticipated economic 
cost to persons who are required to comply with the section as proposed.
Comments on the proposal may be submitted before December 1, 1991, to Paula 
Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, 
Austin, Texas 78711.
The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, 
which authorize the commission to adopt rules to administer the Texas Racing Act 
and sec.15.03, which authorize the commission to impose administrative 
penalties.
sec.323.101. <nl>Administrative  [Civil] Penalties.
<nl>(a) If the commission determines that a person regulated under this Act has 
violated this Act or a rule or order adopted under this Act in a manner that 
constitutes a ground for a disciplinary action under this Act, the commission 
may assess an administrative penalty against that person as provided by this 
section.
<nl>(b) The commission delegates to the executive secretary the authority to 
prepare and issue preliminary reports pursuant to the Act, sec.15.03. If, after 
examination of a possible violation and the facts relating to that violation has 
occurred, the executive secretary determines that a violation has occurred, the 
executive secretary shall issue a preliminary report that states the facts on 
which the conclusion is based, the fact that an administrative penalty is to be 
imposed, and the amount to be assessed. The amount of the penalty may not exceed 
$10,000 for each violation. Each day that a violation continues may be 
considered a separate violation. In determining the amount of the penalty, the 
commission shall consider the seriousness of the violation.
<nl>(c) Not later than the 10th day after the date on which the executive 
secretary issues the preliminary report, the executive secretary shall send a 
copy of the report to the person charged with the violation, together with a 
statement of the right of the person to a hearing relating to the alleged 
violation and the amount of the penalty.
<nl>(d) Not later than the 20th day after the date on which the executive 
secretary sends the preliminary report, the person charged may make a written 
request for a hearing or may remit the amount of the administrative penalty to 
the commission. Failure to request a hearing or to remit the amount of the 
administrative penalty within the period prescribed by this subsection results 
in a waiver of a right to a hearing under the Act. If the person charged 
requests a hearing, the hearing shall be conducted in the manner provided for a 
contested case hearing under the Administrative Procedure and Texas Register 
Act, (Texas Civil Statutes, Article 6252-13a).
<nl>(e) If it is determined after the hearing that the person has committed the 
alleged violation, the commission shall give written notice to the person of the 
findings established by the hearing and the amount of the penalty and shall 
enter an order requiring the person to pay the penalty.
<nl>(f) Not later than the 30th day after the date on which the notice under 
subsection (e) of this section is received, the person charged shall pay the 
administrative penalty in full or exercise the right to appeal either the amount 
of the penalty or the fact of the violation. If a person exercises a right of 
appeal either as to the amount of the penalty or the fact of the violation, the 
amount of the penalty is not required to be paid until the 30th day after the 
date on which all appeals have been exhausted and the commission's decision has 
been upheld.
[(a) The commission or the stewards or racing judges may impose civil penalties 
as provided by the Act for violations of the Act, a rule or order of the 
commission, or an order of a court relating to racing or pari-mutuel wagering.
[(b) In addition, the commission may request the attorney general to initiate 
legal proceedings to recover civil penalties against a person for a violation of 
the Act, a rule or order of the commission, or an order of a court relating to 
racing or pari-mutuel wagering.]
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113550
Paula Cochran Carter
General Counsel
Texas Racing Commission
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-8461
       
TITLE 19. EDUCATION
Part II. Texas Education Agency
Chapter 53. Regional Education Service Centers
The Texas Education Agency proposes amendments to sec. s53.2, 53.3, and 53. 21-
53.25 concerning regional education service centers. The Texas Performance 
Review conducted by the Office of the Comptroller in the spring of 1991 and most 
recently, the Texas Education Agency Reorganization Advisory Committee Report, 
have recommended that the role of the education service centers be expanded and 
that the centers take on a greater responsibility for the delivery of technical 
assistance to schools. The studies also recommended that the commissioner of 
education provide greater direction in the operations and services of the 
centers. The intent of the proposed amendments is to implement the 
recommendations of the studies.
Robert Scott, director of education service centers, has determined that for the 
first five-year period the sections are in effect there will be no fiscal 
implications for state or local government as a result of enforcing or 
administering the sections.
Mr. Scott and Criss Cloudt, director for planning coordination, also have 
determined that for each year of the first five years the sections are in effect 
the public benefit anticipated as a result of enforcing the sections will be 
that the quality of services provided by regional education service centers will 
improve as a result of direct accountability to the commissioner, and the 
activities of the centers will be refocusing on improving student achievement. 
There will be no effect on small businesses. There is no anticipated economic 
cost to persons who are required to comply with the sections as proposed.
Comments on the proposal may be submitted to Criss Cloudt, Planning 
Coordination, 1701 North Congress Avenue, Austin, Texas 78701, (512) 463-9701. 
All requests for a public hearing on the proposed sections submitted in 
accordance with the Administrative Procedure and Texas Register Act must be 
received by the commissioner of education not more than 15 calendar days after 
notice of a proposed change in the chapter has been published in the  Texas 
Register.
Subchapter A. Authorization
19 TAC sec.53.2, sec.53.3
The amendments are proposed under the Texas Education Code, sec.11.32(a), which 
provides the State Board of Education with the authority to establish rules and 
regulations for the operation of regional education service centers.
sec.53.2. Services to Member Schools.
(a) Each regional education service centers shall develop and provide to member 
schools services in [the core service] areas specified in the state plan for 
regional education service centers. Specific [core] <nl>services<ol> [service 
tasks] and outcomes <nl>may<ol> [are to] be defined by the commissioner of 
education. Other services may be offered on a free-market basis outside regional 
boundaries.
(b) (No change.)
sec.53.3. Location of Centers.
(a)-(f) (No change.)
(g) The State Board of Education shall periodically review <nl>the boundaries of 
the regions and the number and location<ol> [number, location, and boundaries] 
of regional education service  <nl>centers.<ol> [centers, and considering] 
<nl>Considering<ol> demographic and other factors <nl>the State Board of 
Education<ol> may change the existing structure when such changes will enhance 
effectiveness, economy, or provision of services.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 21, 1991.
TRD-9113485
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter B. Administration and Operation
19 TAC sec.sec.53.21-53.25
The amendments are proposed under the Texas Education Code, sec.11.32(a), which 
provides the State Board of Education with the authority to establish rules and 
regulations for the operation of regional education service centers.
sec.53.21. Working Relationships.
(a) (No change.)
(b)  Board of directors.
(1) The service center board of directors is charged with the development of 
policies to ensure sound management and operation of the regional education 
service center within state <nl>laws,<ol> [laws and] the rules of the State 
Board of Education, and <nl>directives of the commissioner<ol> [to ensure 
responsiveness to the needs of the school districts in the region. A copy of 
current regional board policies shall be filed with the Central Education 
Agency.]
(2) (No change.)
<nl>(3) The executive director is accountable to the center board of directors 
and to the commissioner of education for operation of the center and quality of 
services provided by the center.<ol> [The board of directors is accountable 
through the commissioner of education to the State Board of Education for 
operation of the center in accordance with state laws and the rules of the State 
Board of Education.]
(4)-(6) (No change.)
(c)-(d) (No change.)
(e)  Commissioner's <nl>cabinet<ol> [advisory council] for regional services. 
<nl>A cabinet <ol> [An advisory council] composed of the executive directors of 
the regional education service centers shall meet upon call by the commissioner 
of education  <nl>for purpose of advising on developing and facilitating the 
implementation of<ol> [to assist in the development of] comprehensive plans  
<nl>and<ol> [for] programs to be carried out through the regional education 
service centers [in cooperation with the Central Education Agency, member 
schools, and institution of higher learning and other agencies]. The structure 
[and functions] of the commissioner's <nl>cabinet<ol> [advisory council] shall 
be designated by the commissioner.
(f) (No change.)
sec.53.22 Staff.
(a) General provisions. The regional board of directors shall <nl>adopt 
personnel policies and<ol> employ personnel as needed to carry out the functions 
of the center and to ensure its successful operation. Staffing structure shall 
be consistent with position titles and functions specified in the state plan. 
The board of directors shall adopt policies for effective minority recruitment 
with the objective of attaining a qualified professional staff that is 
reflective of the ethnic composition of the professional staff of the public 
schools of Texas.
(b) Staff selection.
<nl>(1) The selection of the executive director is to be made jointly by the 
commissioner of education and the board of directors. The executive director 
shall be selected in accordance with the following procedure.
<nl>(A) The board of directors notifies the commissioner of education that a 
vacancy exists.
<nl>(B) The board of directors in conjunction with a representative of the 
commissioner of education shall recommend a candidate to the commissioner of 
education for approval.
<nl>(C)  Following approval of the candidate by both the commissioner of 
education and the board of directors. The board initiates the final steps of the 
employment process.
<nl>(2) The continued employment of the executive director shall be determined 
annually by the commissioner based on a recommendation from the board of 
directors following a performance review of the executive director conducted by 
the board and a representative of the commissioner.
[(1) The regional board of directors shall employ an executive director in 
accordance with the following procedures.
[(A)  The board notifies the commissioner of education that a vacancy exists.
[(B) The board drafts a list of competencies it expects the executive director 
to possess. This will provide a guide for the board in identifying and employing 
the best possible applicant.
[(C) The board drafts a job vacancy notice which includes the draft list of 
competencies and position qualifications.
[(D) The board designates a search committee to assist with the initial steps in 
the selection process.
[(E) The board sends the draft list of competencies, the job vacancy notice, and 
the list of search committee members to the commissioner of education for 
approval. As part of the approval process, the commissioner of education may 
meet with the board to review and revise documents as necessary.
[(F) After approval, the job vacancy notices are distributed as follows:
[(i) commissioner of education;
[(ii) each of the 20 regional education service centers;
(iii) each school district within the region; and
[(iv) other (optional).
[(G) Notices of the job vacancy are posted for a period of at least 30 days from 
the date of the announcement, and applications are accepted during that time.
[(H) All qualified applicants are given equal consideration, and no person shall 
be excluded on the grounds of race, religion, color, national origin, sex, 
handicap, or age (except where handicap or age constitutes a bona fide 
impediment to the proper and efficient fulfillment of the duties of this 
position).
[(I)  The search committee narrows the field of applicants to three-five 
finalists and notifies the board. The board then provides the commissioner a 
list of all qualified candidates with the selected finalists identified. The 
commissioner may approve the list or may choose to interview the finalists prior 
to making a decision. If fewer than two finalists are approved by the 
commissioner, the board may direct the search committee to develop another list 
of finalists.
[(J) Upon receipt of approval from the commissioner of education, the board 
initiates the final steps in the selection process.
[(K) The board of directors as a whole interviews each of the finalists, selects 
the best qualified applicant, and notifies the commissioner of education of its 
decision.]
<nl>(3)<ol>[(2)] The board of directors confirms employment of other staff who 
are recommended by the executive director. Qualifications of personnel employed 
shall equal or exceed those which are required by school districts with similar 
duties and responsibilities. Professional personnel shall possess appropriate 
training, experience, and certification to perform assigned responsibilities and 
function competently and effectively.
<nl>(4)<ol>[(3) ] Each regional education service center shall provide to the 
Central Education Agency an organization chart and personnel roster for each 
fiscal year.
(c) Salaries.
(l) An annual salary schedule including salary ranges for all positions 
<nl>except that of the executive director<ol> shall be [prepared according to 
provisions in the state plan for education service centers and] approved by the 
education service center board of directors and submitted each year to the 
commissioner of education.
(2) Salary ranges, including fringe benefits, for executive directors shall be 
established by the commissioner of education [in consultation with the regional 
board of directors. The salary range will take into consideration the size of 
the service center operation and the salaries of superintendents in the region.] 
<nl>The board of directors shall set the executive director's annual salary 
within the ranges established by the commissioner of education.
(3) (No change.)
sec.53.23. Fiscal Records and Accounting. Fiscal records and accounting 
procedures shall be in accordance with standards prescribed by the commissioner 
of education. <nl>The standardized budgeting, accounting, and auditing system 
for regional education service centers shall be specified in Bulletin 679, 
Financial Accounting Manual.
sec.53.24. Accountability Requirements.
[(a)] The system of accountability in the delivery of regional services shall 
include the following activities.
(1)-(2) (No change.)
(3)  Management and service audits shall be conducted as provided in 
sec.109.24[(d) ] of this title (relating to School District Independent Audits) 
[Field Audits and Reviews)].
(4) (No change.)
(5) Annual financial audits shall be provided in accordance with 
<nl>sec.109.24<ol> [sec.109.25] of this title (relating to School District [and 
Regional Education Service Center] Independent Audits).
(6) [Annual budget reviews shall be conducted as follows.]
[(A)] The regional education service center board of directors shall 
<nl>adopt<ol> [develop and approve] an annual operating budget for the center in 
accordance with the Texas Education Code, sec.23.42. <nl>That budget must 
include all funds of the center and must be approved by the commissioner prior 
to expenditure of any funds.<ol> [The standardized reporting system for regional 
education service center budgets is specified in Bulletin 679, Financial 
Accounting Manual.]
<nl>(7)<ol>[(B)] In order to expend state funds, regional education service 
centers must comply with the prescribed reporting requirements and provide 
necessary information to the commissioner of education. In instances where 
regional education service centers are not in compliance with the reporting 
requirements, the commissioner of education may withhold state and/or federal 
funds until such time as the regional education service center is in compliance 
with the reporting requirements.
<nl>(8)<ol>[(7)] The commissioner shall require reports concerning fund balances 
at the end of the fiscal year.
<nl>(9)<ol>[(8)] The Central Education Agency shall provide for an evaluation of 
the quality of services delivered by each center [in each of the core service 
areas]. Such an evaluation shall include an assessment of service quality by 
direct users of the service.
[(b) The accountability activities identified in subsections (a)(1)-(8) of this 
section provide the basis for an overall review of regional education service 
center effectiveness. Such a review shall be made annually by the commissioner 
of education. The results of this review shall be reported to the regional 
education service center board of directors, the State Board of Education, and 
other interested agencies. This report shall identify strengths and weaknesses 
of individual regional education service centers and the regional delivery 
system concept.]
sec.53.25. Powers of the Commissioner of Education to Impose Sanctions.
(a) Whenever the commissioner of education determines that a regional education 
service center is operating in [substantial] violation of law, including 
constitutional, statutory, and regulatory provisions, fails to provide [core] 
services in accordance with State Board of Education or commissioner directives, 
or fails to provide adequate leadership or management of the center, the 
commissioner of education may, after notice and an opportunity for hearing, 
impose sanctions against the regional education service center, including one or 
more of the following:
(1)-(5) (No change.)
(b)-(g) (No change. )
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 18, 1991.
TRD-9113486
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Chapter 105. Foundation School Program
The Texas Education Agency (TEA) proposes the repeal of  ssec.105.11, 105. 21-
105.27, 105.49, 105.71, 105.72, 105.92, 105.171, 105.210, 105.252-105.255, 
105.291, 105.292, 105.331, 105.391, 105.392, and 105.461-105.469, concerning the 
Foundation School Program. Senate Bill 1, 71st Legislature, requires the State 
Board of Education (SBOE) to reconsider all rules affected by this provision so 
that any rules adopted on these matters must occur under the new rulemaking 
relationship between the SBOE and the Legislative Education Board. The review of 
the rules is to be conducted over a three-year period. All sections of Chapter 
105 have been reviewed by the board and are being repealed. A new Chapter 105 is 
being proposed in a separate submission.
Criss Cloudt, director planning coordination, has determined that for the first 
five-year period the repeals are in effect there will be no fiscal implications 
for state or local government as a result of enforcing or administering the 
repeals.
Ms. Cloudt also has determined that for each year of the first five years the 
repeals are in effect the public benefit anticipated as a result of enforcing 
the repeals will be a clearer more concise statement of the agency's rule 
authority. There will be no effect on small businesses. There is no anticipated 
economic cost to persons who are required to comply with the repeals as 
proposed.
Comments on the proposal may be submitted to Criss Cloudt, Planning 
Coordination, 1701 North Congress Avenue, Austin, Texas 78701, (512) 463-9701. 
All requests for a public hearing on the proposed repeals submitted in 
accordance with the Administrative Procedure and Texas Register Act must be 
received by the commissioner of education not more than 15 calendar days after 
notice of a proposed change in the section has been published in the  Texas 
Register.
Subchapter A. Tax Collections
19 TAC sec.105.11
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.105.11. Rules for the Definition of Tax Collections to be Used in the 
Foundation School Program Allocations.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113487
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter B. Average Daily Attendance
19 TAC sec.sec.105.21-105.27
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.105.21. Basis for Determining Allocations.
sec.105.22. Eligible ADA.
sec.105.23. Resident Pupil.
sec.105.24. Approved Transfer Pupils.
sec.105.25. Procedure for Transfer.
sec.105.26. Transfer of Average Daily Attendance for Distribution of the State 
Available School Fund.
sec.105.27. Transfer of Average Daily Attendance When Schools are Consolidated 
or Contracted.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113488
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter C. Allocation of Funds for Windham Independent School District
19 TAC sec.105.49
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeal is proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.105.49. Windham Independent School District (ISD) Allotment.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113489
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter D. School Year
19 TAC sec.105.71, sec.105.72
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.105.71. Days of Opertion Required.
sec.105.72. Service Requirements
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113490
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter E. Salary Schedule
19 TAC sec.105.92
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeal is proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.105.92. Minimum Salary Schedule.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113491
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter I. County Available School Funds
19 TAC sec.105.171
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeal is proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.105.171. Administration and Apportionment.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113492
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter K. Distribution of Foundation School Fund
19 TAC sec.105.210
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeal is proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.105.210. Distribution of Foundation School Fund.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113493
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter M. State Minimum Sick Leave
19 TAC sec.sec.105.252-105.255
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.105.252. Local District Policy Required.
sec.105.253. Determining Eligible Sick Leave.
sec.105.254. Accumulating Sick Leave.
sec.105.255. Recording Sick Leave.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113494
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter O. State Allocations to Regional Education Service Centers
19 TAC sec.105.291, sec.105.292
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.105.291. Basic Financial Support for Regional Education Services.
sec.105.292. Regional Medical Services Funding.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113495
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter Q. Adjustment of Payments
19 TAC sec.105.331
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeal is proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.105.331. Records and Audits.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113496
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter T. Requirements for Program Participation
19 TAC sec.105.391, sec.105.392
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.105.391. Accreditation Required.
sec.105.392. Student-Teacher Ratios.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113497
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter W. Price Differential Index
19 TAC sec.sec.105.461-195.469
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.105.461. Specifications for Econometric Model.
sec.105.462. Data Values for Unadjusted Price Differential Index Factors.
sec.104.463. Determining Each District's Price Differential Index.
sec.105.464. Determining the Adjusted Basic Allotment.
sec.105.465. Adjusted Price Differential Index and Adjusted Basic Allotment.
sec.105.466. Price Differential Index for 1989-1990 and 1990-1991.
sec.105.467. Determining the Adjusted Basic Allotment.
sec.105.468. Indices for Reconfigured Districts.
sec.105.469. Data Values for Price Differential Index Factors.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113498
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter A. Definitions
The Texas Education Agency (TEA) proposes new sec.105.11 and sec.105.31, 
concerning the Foundation School Program. Senate Bill 1, 71st Legislature, 
requires the State Board of Education (SBOE) to reconsider all rules affected by 
this provision so that any rules adopted on these matters must occur under the 
new rulemaking relationship between the SBOE and the Legislative Education 
Board. The review of the rules is to be conducted over a three-year period. All 
sections of Chapter 105 have been reviewed by the board and are being repealed 
in a separate submission.
Dr. Thomas Anderson, deputy commissioner for school support services, has 
determined that for the first five-year period the sections are in effect there 
will be fiscal implications for state and local government as a result of 
enforcing or administering the sections. The effect on state and local 
government revenues depends on a number of factors, including state and local 
property valuation, local tax levy, number of students, and other factors. Under 
the sections, districts in certain circumstances would be eligible to use a 
higher number for tax collection in qualifying for state guaranteed yield funds. 
No additional cost to the state is anticipated before fiscal year 1994 due to 
appropriation limits.
Dr. Anderson and Criss Cloudt, director for planning coordination, have 
determined that for each year of the first five years the sections are in effect 
the public benefit anticipated as a result of enforcing the sections will be a 
clearer more concise statement of the agency's rule authority, and the 
possibility that school districts may in certain circumstances get access to 
more state funding. There will be no effect on small businesses. There is no 
anticipated economic cost to persons who are required to comply with the 
sections as proposed.
Comments on the proposal may be submitted to Criss Cloudt, Planning 
Coordination, 1701 North Congress Avenue, Austin, Texas 78701, (512) 463-9701. 
All requests for a public hearing on the proposed sections submitted in 
accordance with the Administrative Procedure and Texas Register Act must be 
received by the commissioner of education not more than 15 calendar days after 
notice of a proposed change in the sections has been published in the  Texas 
Register.
19 TAC sec.105.11
The new sections are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.105.11. Rules for the Definition of Tax Levy and Tax Collection.
(a) General provisions. For the purpose of determining state aid under the Texas 
Education Code, Chapter 16, calculations that include tax collections as a data 
element shall reference subsection (b) of this section.
(b) Definitions. The following words and terms, when used in this chapter, shall 
have the following meanings, unless the context clearly indicates otherwise.
(1) Total levy-The sum of the maintenance and operation and debt service levies 
generated by applying a district's adopted tax rates to its locally assessed 
valuation of property for the current tax year.
(2) Tax collection-Total taxes collected September 1-August 31 for the current 
and all prior years' total levies.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 18, 1991.
TRD-9113499
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter B. School Year
19 TAC sec.105.31
The new section is proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.105.31. Abbreviated Days of Instruction. With the approval of the local 
school board of trustees, a school may operate on an abbreviated day (not to be 
confused with half-day sessions). Where it is determined by the local board, in 
order to meet all classroom assignments, the local board may shorten each class 
period for any reason acceptable to the local board of trustees. This procedure 
is to be used no more than six times per year and is to be so noted in the 
minutes of the local school board of trustees.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 18, 1991.
TRD-9113500
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Chapter 109. Budgeting, Accounting, and Auditing
The Texas Education Agency (TEA) proposes the repeal of  ssec.109.1, 109. 21-
109.25, 109.41-109.44, and 109.61, concerning budgeting, accounting, and 
auditing. Senate Bill 1, 71st Legislature, requires the State Board of Education 
(SBOE) to reconsider all rules affected by this provision so that any rules 
adopted on these matters must occur under the new rulemaking relationship 
between the SBOE and the Legislative Education Board. The review of the rules is 
to be conducted over a three-year period. All sections of Chapter 109 have been 
reviewed by the board and are being repealed. A new Chapter 109 is being 
proposed in a separate submission.
Criss Cloudt, director planning coordination, has determined that for the first 
five-year period the repeals are in effect there will be no fiscal implications 
for state or local government as a result of enforcing or administering the 
repeals.
Ms. Cloudt, also has determined that for each year of the first five years the 
repeals are in effect the public benefit anticipated as a result of enforcing 
the repeals will be a clearer more concise statement of the agency's rule 
authority. There will be no effect on small businesses. There is no anticipated 
economic cost to persons who are required to comply with the repeals as 
proposed.
Comments on the proposal may be submitted to Criss Cloudt, Planning 
Coordination, 1701 North Congress Avenue, Austin, 78701, (512) 463-9701. All 
requests for a public hearing on the proposed repeals submitted in accordance 
with the Administrative Procedure and Texas Register Act must be received by the 
commissioner of education not more than 15 calendar days after notice of a 
proposed change in the section has been published in the Texas Register.
Subchapter A. Budgeting, Accounting, Financial Reporting, and Auditing for 
School Districts
19 TAC sec.109.1
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeal is proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.109.1. Financial Accounting.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113501
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter B. Central Education Agency Audit Functions
19 TAC sec.sec.109.21-109.25
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.109.21. Types of Audit Functions.
sec.109.22. Annual Audit Plan.
sec.109.23. Internal Audits and Reviews.
sec.109.24. Field Audits and Reviews.
sec.109.25. School District and Regional Education Service Center Independent 
Audits.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113502
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter C. Advisory Committee for Budgeting, Accounting, and Auditing
19 TAC sec.sec.109.41-109.44
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.109.41. Purpose and Responsibilities.
sec.109.42. Membership and Appointment.
sec.109.43. Term of Office.
sec.109.44. Meetings
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113503
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter D. Adoptions by Reference
19 TAC sec.109.61
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeal is proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.109.61. Financial Accounting Manual.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113504
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
The Texas Education Agency (TEA) proposes new sec.sec.109.1, 109.21-109. 24, 
109.41-109.44, and 109.61, concerning budgeting, accounting, and auditing. 
Senate Bill 1, 71st Legislature, requires the State Board of Education (SBOE) to 
reconsider all rules affected by this provision so that any rules adopted on 
these matters must occur under the new rule-making relationship between the SBOE 
and the Legislative Education Board. The review of the rules is to be conducted 
over a three-year period. All sections of Chapter 109 have been reviewed by the 
board and are being repealed in a separate submission.
Dr. Thomas Anderson, deputy commissioner for school support services, has 
determined that for the first five-year period the sections are in effect there 
will be fiscal implications for local government as a result of enforcing or 
administering the sections. There will be no fiscal implications for state 
government. The effect on local government for the first five-year period the 
sections will be in effect is an estimated additional cost of $658,000 each year 
from 1991-1996.
Dr. Anderson and Criss Cloudt, director for planning coordination, also have 
determined that for each year of the first five years the sections will be in 
effect the public benefit anticipated as a result of enforcing the sections will 
be a clearer more concise statement of the agency's rule authority. There will 
be no effect on small businesses. There is no anticipated economic cost to 
persons who are required to comply with the sections as proposed.
Comments on the proposal may be submitted to Criss Cloudt, Planning 
Coordination, 1701 North Congress Avenue, Austin, Texas 78701, (512) 463-9701. 
All requests for a public hearing on the proposed sections submitted in 
accordance with the Administrative Procedure and Texas Register Act must be 
received by the commissioner of education not more than 15 calendar days after 
notice of a proposed change in the section has been published in the  Texas 
Register.
Subchapter A. Budgeting, Accounting, and Financial Reporting, and Auditing for 
School Districts
19 TAC sec.109.1
The new sections are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.109.1. Financial Accounting.
(a) A uniform system of public school budgeting, accounting, and financial 
reporting shall be provided and employed throughout the state as required by 
law. The uniform system for budgeting, accounting, and financial reporting is to 
reflect the full implementation of modified and full accrual accounting, as 
appropriate, in accordance with generally accepted accounting principles.
(b) The commissioner of education shall develop and administer the requirements 
for public school budgeting, accounting, and financial reporting and prescribe 
the necessary auditing requirements. The State Board of Education shall approve 
the budgeting, accounting, and reporting systems and the auditing procedures as 
determined by the commissioner of education. The school districts shall install 
the budgeting, accounting, and financial reporting system as required by law and 
meet the audit requirements as developed by the commissioner of education and 
subjected to review and comment by the state auditor when required by law.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 18, 1991.
TRD-9113505
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter B. Central Education Agency Audit Functions
19 TAC sec.sec.109.21-109.24
The new sections are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.109.21. Types of Audit Functions.
(a) The provisions of this subchapter cover three audit functions that include:
(1) internal audits and reviews performed by staff;
(2) field audits and reviews of school districts, regional education service 
centers, and other subgrantees performed by staff; and
(3) independent audits of school districts, county education districts, and 
regional education service centers performed by locally engaged Texas licensed 
public and certified public accountants.
(b)  Independent audits of the Central Education Agency are performed by the 
state auditor or other audit agencies per law, rule, or agreement. These audits 
are reviewed and resolved under the direction of the commissioner of education.
sec.109.22. Annual Audit Plans. The commissioner of education shall submit 
separate annual audit plans for internal audits and for field and independent 
audits for review of the designated committee of the State Board of Education. 
The plans may be amended as needed by the commissioner of education. The 
designated committee of the State Board of Education shall be informed at least 
semiannually by the commissioner of education on the progress of and amendments 
to the plans.
sec.109.23. Internal Audits and Reviews.
(a) Internal audits and reviews shall be performed freely and objectively by the 
internal auditors in accordance with the annual audit plan. Internal auditors 
shall be free of operating responsibilities, that will tend to impair audit 
objectivity.
(b)  The chief internal auditor shall report directly to the commissioner of 
education, and to the appropriate committee of the State Board of Education. 
Internal audit reports and reviews shall be addressed to the commissioner of 
education.
sec.109.24. School District Independent Audits.
(a) The performance and review of required school district, county education 
district, and regional education service center independent audits, including 
review of auditors' working papers, shall be accomplished in-accordance with the 
Financial Accounting Manual, Bulletin 679, sec.109.61 of this title (relating to 
Financial Accounting Manual).
(b) Auditors from the Central Education Agency shall review independent audit 
reports. Audit findings shall be resolved by the commissioner's designee.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 18, 1991.
TRD-9113506
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter C. Advisory Committee for Budgeting, Accounting, and Auditing
19 TAC sec.sec.109.41-109.44
The new sections are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.109.41. Purpose and Responsibilities. The Advisory Committee for Budgeting, 
Accounting, and Auditing shall advise the Texas Education Agency on all aspects 
of the uniform system for school district budgeting, accounting, and auditing.
sec.109.42. Membership and Appointment. The Advisory Committee for Budgeting, 
Accounting, and Auditing shall be composed of 15 members, approved by the State 
Board of Education upon recommendation of the commissioner of education.
(1) One member shall represent a school district with more than 100,000 average 
daily attendance.
(2) One member shall represent a school district with fewer than 500 average 
daily attendance.
(3) Five members shall represent school districts with between 500 and 100,000 
average daily attendance.
(4) One member shall represent regional education service centers.
(5) One member shall be a professor of accounting from a Texas university.
(6) Three members shall be certified public accountants representing firms 
actively engaged in auditing of Texas public schools.
(7) Three members shall be persons that are involved with the use of Texas 
public school financial data.
sec.109.43. Term of Office. Committee members shall be appointed for three-years 
terms.
sec.109.44. Meetings.  The advisory committee shall hold one regular annual 
meeting and called meetings as required.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 18, 1991.
TRD-9113507
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter D. Adoptions by Reference
19 TAC sec.109.61
The new section is proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.109.61. Financial Accounting Manual.
(a) The rules for financial accounting are described in the official Central 
Education Agency bulletin, Financial Accounting Manual, Bulletin 679, as amended 
June 1991, which is adopted by this reference as the agency's official rule. A 
copy is available for examination during regular office hours, 8 a.m. to 5 p.m., 
except holidays, Saturdays, and Sundays, at the Central Education Agency, 1701 
North Congress Avenue, Austin, Texas 78701.
(b) The commissioner of education shall amend Financial Accounting Manual, 
Bulletin 679, and this section adopting it by reference, as needed. The 
commissioner shall inform the State Board of Education of the intent to amend 
the bulletin and of the effect of proposed amendments before submitting them to 
the Office of the Secretary of State as proposed rule changes.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 18, 1991.
TRD-9113508
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Chapter 113. Federal Funds to Support Public Education in Texas
The Texas Education Agency (TEA) proposes the repeal of  ssec.113.1, 113.21, and 
113.41-113.45, concerning federal funds to support public education in Texas. 
Senate Bill 1, 71st Legislature, requires the State Board of Education (SBOE) to 
reconsider all rules affected by this provision so that any rules adopted on 
these matters must occur under the new rulemaking relationship between the SBOE 
and the Legislative Education Board. The review of the rules is to be conducted 
over a three-year period. All sections of Chapter 113 have been reviewed by the 
board and are being repealed. A new Chapter 113 is being proposed in a separate 
submission.
Criss Cloudt, director planning coordination, has determined that for the first 
five-year period the repeals are in effect there will be no fiscal implications 
for state or local government as a result of enforcing or administering the 
repeals.
Ms. Cloudt also has determined that for each year of the first five years the 
repeals are in effect the public benefit anticipated as a result of enforcing 
the repeals will be a clearer more concise statement of the agency's rule 
authority. There will be no effect on small businesses. There is no anticipated 
economic cost to persons who are required to comply with the repeals as 
proposed.
Comments on the proposal may be submitted to Criss Cloudt, Planning 
Coordination, 1701 North Congress Avenue, Austin, Texas 78701, (512) 463-9701. 
All requests for a public hearing on the proposed repeals submitted in 
accordance with the Administrative Procedure and Texas Register Act must be 
received by the commissioner of education not more than 15 calendar days after 
notice of a proposed change in the section has been published in the  Texas 
Register.
Subchapter A. Federal Funds for Local Education Agencies
19 TAC sec.113.1
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeal is proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.113.1. Contracts Permitted.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113509
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter B. Federal Funds for the Texas Education Agency
19 TAC sec.113.21
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeal is proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.113.21. Compatibility with Goals; Inclusion in Budget.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113510
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter C. Complaint Procedures for Federal Programs
19 TAC sec.sec.113.41-113.45
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
sec.113.41. Nature of Complaints.
sec.113.42. Resolution of Complaints Concerning Federal Programs.
sec.113.43. Complaints Concerning Programs Not Financed In Whole or In Part by 
Federal Funds.
sec.113.44. Hearings.
sec.113.45. Delegation of Authority.
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113511
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
The Texas Education Agency (TEA) proposes new sec.sec.113.1 113.21, 113.22, 
113.31, and 113.32, concerning federal funds to support public education in 
Texas. Senate Bill 1, 71st Legislature, requires the State Board of Education 
(SBOE) to reconsider all rules affected by this provisions so that any rules 
adopted on these matters must occur under the new rulemaking relationship 
between the SBOE and the Legislative Education Board. The review of the rules is 
to be conducted over a three-year period. All sections of Chapter 113 have been 
reviewed by the board and are being repealed in a separate submission.
Dr. Thomas E. Anderson, deputy commissioner for school support services, has 
determined that for the first five-year period the sections are in effect there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the sections.
Dr. Anderson and Criss Cloudt, director for planning coordination, also has 
determined that for each year of the first five years the sections are in effect 
the public benefit anticipated as a result of enforcing the sections will be a 
clearer more concise statement of the agency's rule authority. There will be no 
effect on small businesses. There is no anticipated economic cost to persons who 
are required to comply with the sections as proposed.
Comments on the proposal may be submitted to Criss Cloudt, Planning 
Coordination, 1701 North Congress Avenue, Austin, 78701, (512) 463-9701. All 
requests for a public hearing on the proposed sections submitted in accordance 
with the Administrative Procedure and Texas Register Act must be received by the 
commissioner of education not more than 15 calendar days after notice of a 
proposed change in the sections has been published in the Texas Register.
Subchapter A. Federal Funds for Local Education Agencies
19 TAC sec.113.1
The new section are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.113.1. Contracts Permitted. <ol> To support the local education program, a 
local education agency may enter into contract with, or accept money from, an 
agency of the federal government.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 18, 1991.
TRD-9113512
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter B. Complaint Procedures for Federal Programs
19 TAC sec.113.21, sec.113.22
The new sections are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.113.21. Complaints Concerning Federally Funded Programs.
(a)  Any person or organization may file a written signed complaint with the 
commissioner of education under the provisions of this subchapter. The complaint 
must include a statement that the Texas Education Agency, a school district, or 
any person or entity which receives federal funds directly or indirectly from 
the Texas Education Agency has violated or is violating a federal or state 
constitutional provision, statute, or regulation which relates to a program 
funded at least in part by federal funds. The complaint shall specify the 
requirement at issue and shall set forth the pertinent facts.
(b) Any person who has filed with a school district or with any other person or 
entity receiving funds directly or indirectly from the Texas Education Agency a 
complaint which complies with the requirements of this subsection may, in 
addition to any other available procedures, file a complaint with the 
commissioner of education to appeal the decision reached by the person or entity 
concerning the initial complaint. The complaint shall expressly identify the 
document as a "complaint."
sec.113.22. Resolution of Complaints Concerning Federal Programs.
(a) When the commissioner receives a complaint which complies with sec.113.21 of 
this title (relating to Complaints Concerning Federally Funded Programs) and 
which relates to a program supported by federal funds, the commissioner shall 
review and resolve the complaint within 60 days.
(b) The commissioner shall promptly notify the person or entity against whom the 
complaint is made and shall, if practicable, resolve the complaint on the basis 
of written submissions. If necessary, the commissioner shall carry out an 
independent on-site investigation.
(c) The commissioner may extend the time for resolving a complaint only if 
exceptional circumstances exist with respect to a particular complaint.
(d) The commissioner shall resolve the complaint by issuing a written 
communication finding in favor of or against the complainant as to each issue 
presented. In the event the commissioner finds in favor of a complainant in 
whole or in part, the communication shall specify the corrective action which 
will be required.
(e) Any person who files a complaint may request that the United States 
Secretary of Education review the action of the commissioner concerning that 
complaint.
(f) In the event that the commissioner orders corrective action and the person 
or entity which is the subject of the complaint fails to take such action, the 
commissioner shall give notice that the commissioner intends to take one or more 
of the following actions:
(1) suspend assistance for the applicable program;
(2) terminate further assistance for the applicable program; or
(3) disapprove the application for funds for the applicable program.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 18, 1991.
TRD-9113513
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter C. Hearing Procedures for Federal Programs
19 TAC sec.113.31, sec.113.32
The new sections are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.113.31. Hearings Concerning Federal Programs.
(a) Any persons or entity which receives a notice from the commission under 
sec.113.22(f) of this title (relating to Resolution of Complaints Concerning 
Federal Programs), who is otherwise denied financial assistance in whole or in 
part under any program in whole or in part by federal funds, who is notified of 
the commissioner's intent to disapprove an application for such assistance or 
otherwise deny such assistance, or who is order to repay state or federal funds 
pursuant to a final audit determination issued by the commissioner may request a 
hearing before the commissioner. The rules contained in Chapter 157 of this 
title (relating to Hearings and Appeals) are applicable to such hearings except 
as provided in subsection (b) of this section.
(b) The following requirements shall apply to a hearing held under this chapter.
(1) The hearing must be requested within 30 days of the receipt of the notice, 
decision, or order of the commissioner of education.
(2) A hearing of records must be conducted within 30 days of receipt by the 
commissioner of education of the request for a hearing unless a later date is 
agreed to by the parties.
(3) Within 10 days of the close of the hearing the commissioner of education 
shall issue a decision which includes findings of fact and reasons for the 
ruling.
(4) Any party to a hearing may appeal the final decision of the commission of 
education to the United States Secretary of Education by filing an application 
for review within 20 days of receipt of the decision.
sec.113.32. Delegation of Authority. The commissioner of education may delegate 
the performance of any function required by this chapter to an employee of the 
Texas Education Agency or to an independent hearing officer.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 18, 1991.
TRD-9113514
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
        





Chapter 121. Public School Finance-Personnel
The Texas Education Agency (TEA) proposes the repeal of  ssec.121.1, 121. 11-
121.16, and 121.31-121.35, concerning public school finance-personnel Senate 
Bill 1, 71st Legislature, requires the State Board of Education (SBOE) to 
reconsider all rules affected by this provision so that any rules adopted of 
these matters must occur under the new rulemaking relationship between the SBOE 
and the Legislative Education Board. The review of the rules is to be conducted 
over a three-year period. All sections of Chapter 121 have been reviewed by the 
board and are being repealed. A new Chapter 121 is being proposed in a separate 
submission.
Criss Cloudt, director planning coordination, has determined that for the first 
five-year period the repeals are in effect there will be no fiscal implications 
for state or local government as a result of enforcing or administering the 
repeals.
Ms. Cloudt also has determined that for each year of the first five years the 
repeals are in effect the public benefit anticipated as a result of enforcing 
the repeals will be a clearer more concise statement of the agency's rule 
authority. There will be no effect on small businesses. There is no anticipated 
economic cost to persons who are required to comply with the sections as 
proposed.
Comments on the proposal may be submitted to Criss Cloudt, Planning 
Coordination, 1701 North Congress Avenue, Austin, Texas 78701, (512) 463-9701. 
All requests for a public hearing on the proposed repeals submitted in 
accordance with the Administrative Procedure and Texas Register Act must be 
received by the commissioner of education not more than 15 calendar days after 
notice of a proposed change in the section has been published in the the Texas 
Register.
Subchapter A. General Provisions
19 TAC sec.121.1
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeal is proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.121.1 Definitions.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113515
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter B. Personnel Records
19 TAC sec.sec.121.11-121.16
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.121.11. Types of Records.
sec.121.12. Credentials.
sec.121.13. Teacher Service Records
sec.121.14. Evidence of Educational Attainment.
sec.121.15. Contracts.
sec.121.16. Oath of Office.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113516
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter C. Years of Service for Salary Increment Purposes
19 TAC sec.sec.121.31-121.35
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.121.31. General Provisions Concerning Years of Service.
sec.121.32. Minimum Employment Requirements for Creditable Service.
sec.121.33. Entities Recognized for Creditable Service.
sec.121.34. Requirements Concerning Entities Recognized for Creditable Service.
sec.121.35. Credit for Work Experience for Vocational Education Personnel.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113517
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
The Texas Education Agency (TEA) proposes new sec.sec.121.1, 121.11-121. 14, 
121.31-121.35, 121.41, and 121.42, concerning public school finance-personnel. 
Senate Bill 1, 71st Legislature, requires the State Board of Education (SBOE) to 
reconsider all rules affected by this provision so that any rules adopted on 
these matters must occur under the new rulemaking relationship between the SBOE 
and the Legislative Education Board. The review of the rules is to be conducted 
over a three-year period. All sections of Chapter 121 have been reviewed by the 
board and are being repealed in a separate submission.
Tom Patton, director, division of state funding, has determined that for the 
first five-year period the sections are in effect there will be no fiscal 
implications for state or local government as a result of enforcing or 
administering the sections.
Mr. Patton and Criss Cloudt, director for planning coordination, also have 
determined that for each year of the first five years the sections are in effect 
the public benefit anticipated as a result of enforcing the sections will be a 
clearer more concise statement of the agency's rule authority. There will be no 
effect on small businesses. There is no anticipated economic cost to persons who 
are required to comply with the sections as proposed.
Comments on the proposal may be submitted to Criss Cloudt, Planning 
Coordination, 1701 North Congress Avenue, Austin, Texas 78701, (512) 463- 9701. 
All requests for a public hearing on the proposed sections submitted in 
accordance with the Administrative Procedure and Texas Register Act must be 
received by the commissioner of education not more than 15 calendar days after 
notice of a proposed change in the sections has been published in the  Texas 
Register.
Subchapter A. General Provisions
19 TAC sec.121.1
The new section is proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.121.1 Definitions.  The following words and terms, when used in this 
chapter, shall have the following meanings, unless the context clearly indicates 
otherwise.
 Accredited institution -A public or private elementary, secondary, or post-
secondary institution whose education program has been evaluated by a state 
department of education, recognized regional accrediting agency, or accrediting 
agency recognized by the commissioner of education in accordance with sec.97.11 
of this title (relating to Non-public Schools) and has met and is maintaining 
certain standards in the field of education.
 Assignment-Refers to the actual duties a person has with a school district or 
other educational entity.
 Authorized leave -Leave granted under the state minimum sick leave program plus 
any leave granted under a local leave policy for which the employee is paid as 
if on regular duty.
 Auxiliary personnel -Personnel such as bus drivers, custodians, and cooks whose 
positions are not authorized in the Texas Education Code, sec.16.056.
 Certificate-A document issued in accordance with Central Education Agency rules 
authorizing the holder to teach in the public elementary and secondary schools 
of Texas.
 Certified-Status of a person who holds a valid Texas teaching certificate.
 Contractual year -The employment period between July 1 and the following June 
30.
 Current valid certificate-A certificate that is or was valid at a given time, 
including the stipulation that after June 30, 1986, a Texas certificate is valid 
only if the certified person has successfully passed either the Texas 
examination of current administrators and teachers or the examination for 
certification of educators in Texas.
 Employed-The contractual arrangement under which the staff member serves the 
school system whereby responsibility for an activity or group of activities is 
assigned to the staff member.
 Faculty status -Employment by a college or university as a member of the 
professional administrative or instructional staff, not as a graduate assistant, 
an assistant instructor, or an instructor on a fellowship.
 Foundation School Program-The state funded basic school program as authorized 
in the Texas Education Code, Chapter 16.
 Fulltime employment -Employment for 100% of an institution's normal work 
schedule.
 Fulltime equivalency -The amount of time required of a staff member to perform 
a less than fulltime assignment divided by the amount of time required in 
performing a corresponding fulltime assignment. Fulltime Personnel equivalency 
of assignment usually is expressed as a decimal fraction to the nearest tenth.
 Minimum foundation salary-The minimum salary a person must be paid as 
prescribed in the Texas State Public Education Compensation Plan after 
consideration of the person's assignment, degree, and salary increments.
 Paraprofessional personnel -Personnel employed as educational aides or 
educational secretaries.
 Part-time employment -Employment for less than 100% of an institution's normal 
work schedule.
 Professional personnel -Personnel employed in positions classified in the Texas 
Education Code, Chapter 16.
 Regional accrediting agency-The recognized regional accrediting agencies are:
(A) Southern Association of Colleges and Schools;
(B) Middle States Association of Colleges and Schools;
(C)  North Central Association of Colleges and Schools;
(D) New England Association of Schools and Colleges;
(E) Western Association of Schools and Colleges; and
(F) Northwest Association of Schools and Colleges.
 Salary increments -Increases in salary granted for teaching or work experience.
 School day-The time that a school is open during the days of operation required 
in the Texas Education Code, Chapter 16.
 Service-A term of employment measured in school years in an entity in which the 
employment is recognized for salary increment purposes.
 State school-A school which is funded by legislative action in the 
Appropriations Act. These schools include the Texas School for the Blind, the 
Texas School for the Deaf, and schools under the jurisdiction of the Department 
of Mental Health and Mental Retardation and the Texas Youth Commission.
 Substitute teacher -A teacher who works on call, does not have a full-time 
assignment, and generally receives a salary lower than that paid a regular 
member of the teaching staff.
 Teacher service record-The official document used to record years of service 
and days of state sick leave.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 18, 1991.
TRD-9113518
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter B. Personnel Records
19 TAC sec.sec.121.11-121.14
The new sections are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.121.11. Types of Records. The commissioner of education shall prescribe the 
documentation required to be kept on file relative to personnel records.
sec.121.12. Credentials.  Credentials for professional personnel. The 
credentials for professional personnel are as follows.
(1) For a professional employee whose position requires certification, the 
credential must be in the form of a current valid Texas certificate, a special 
assignment permit, a nonrenewable permit, a noncertified instructor's permit, or 
an emergency teaching permit.
(2) For a professional employee whose position does not require certification, 
except as provided in paragraphs (3) and (4) of this section, the credential 
must be a degree from an accredited college or university.
(3) For school physicians, nurse, and certain special education related service 
personnel, the credential must be appropriate licensure from the State of Texas.
(4) For those special education related service personnel who do not required 
Texas certification or licensure, proper credentials as described in sec.89.215 
of this title (relating to Related Services Personnel) are required.
sec.121.13. Teacher Service Record.
(a) The basic document in support of the number of years of professional service 
claimed for salary increment purpose and the state sick leave data for all 
personnel is the teacher service record form (FIN-115) or a similar form 
containing the same information. It is the responsibility of the issuing school 
district to ensure that service records are true and correct and that all 
service recorded on the service records was actually performed.
(b) The commissioner of education shall prescribed the instructions for 
completing the service records and any supporting documentation required to 
substantiate years of service being claimed for salary increment purposes.
sec.121.14. Evidence of Education Attainment. The commissioner of education 
shall prescribe the documentation required to substantiate evidence of 
educational attainment and shall determine the types of degrees for salary 
placement.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 18, 1991.
TRD-9113519
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter C. Years of Service for Salary Increment Purposes
19 TAC sec.sec.121.31-121.35
The new sections are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.121.31. General Provisions Concerning Years of Service.
(a)  All service claimed for salary increment purposes must be documented on a 
teacher service record (Form FIN-115) or other similar document containing the 
same information. The service record and any other required supporting documents 
must meet the requirements for such records and documentation in this chapter.
(b) All service shall be based on the contractual year (July 1-June 30). No more 
than one year of experience may be acquired in any one contractual year.
(c) For persons who held a Texas certificate and were employed during the 1986-
1987 school year or any year thereafter in an entity other than a Texas public 
elementary or secondary school may be recognized for salary increment purposes 
provided the person performed satisfactorily on the Texas examination of current 
administrators and teachers within six months of employment in a Texas public 
elementary or secondary school.
sec.121.32. Minimum Employment Requirements for Creditable Service.
(a) The table in this subsection indicates the minimum number of days required 
to earn and receive credit for a year of experience.
[graphic]
(b) For service performed through the 1989-1990 school year, minimum days at 
less than 100% or at full-time equivalency are applicable only to service in 
Texas public schools, Texas education service centers, and, beginning in 1978-
1979, Texas colleges and universities.
(c) Beginning with service performed during the 1990-1991 school year or any 
year thereafter, employment at less than 100% of the day is recognized in all 
entities where full-time employment is recognized, provided that documentation 
is presented to the employing district which verifies that the employment was 
for not less than 3 1/2 hours each day.
(d) The 90 days required at 100% of the day for years prior to 1972- 1973 may be 
equivalent to 4 1/2 months a full semester, or three six-weeks. Where the school 
year was less than 180 days for any year prior to 1972-1973, a minimum of 175 
days at 50-99% of the day will be accepted, provided that the 175 days 
constituted two full semesters or six six-weeks.
(e) For experience from the 1978-1979 through the 1987-1988 school years, full-
time equivalent days equal the total number of days employed at 100% of the day 
plus days employed at 50-99% of the day divided by two.
(f)  Beginning with the 1988-1989 school year, full-time equivalent days equal 
the total number of days employed multiplied by the percent of day actually 
worked.
(g) Extended day migrant program employment shall be calculated in accordance 
with this section and the resulting equivalent must meet the same minimum 
requirements for professionals for the year in question.
(1)  For service prior to the 1970-1971 school year, the days employed in the 
migrant program shall be multiplied by a factor of 1.37.
(2) For service during the 1970-1971 through the 1975-1976 school years, the 
days employed in the migrant program shall be multiplied by a factor of 1.31.
sec.121.33. Entities Recognized for Creditable Service.  Entities recognized for 
professional personnel. Service in any of the entities listed in this section 
shall be recognized for professional personnel. The minimum employment 
requirements in sec.121.32 of this title (relating to Minimum Employment 
Requirements for Creditable Service) must be met. Requirements concerning 
service in each type of entity in sec.121.34 of this title (relating to 
Requirements Concerning Entities Recognized for Creditable Service) must also be 
met. Service in the following entities is creditable:
(1) Texas public elementary and secondary schools;
(2) Texas regional education service centers;
(3) the Central Education Agency;
(4) Texas Department of Corrections-Windham Schools;
(5) overseas schools operated by the United States Government;
(6) public elementary and secondary schools in all other states in the United 
States or within the boundaries of any of its territorial possessions;
(7) Texas public or private colleges or universities;
(8) Texas private elementary and secondary schools;
(9) Texas non-public special education contract schools;
(10) Texas Department of Mental Health and Mental Retardation -state hospitals;
(11) Texas veterans' vocational schools;
(12) United States Department of Interior-Bureau of Indian Affairs;
(13) United States service academies;
(14) United States military service;
(15) Job Corps;
(16) Peace Corps (in a teaching capacity only);
(17) public or private colleges or universities and private elementary and 
secondary schools in all other states in the United States or within the 
boundaries of any of its territorial possessions; and
(18) foreign public or private colleges or universities, or elementary and 
secondary schools.
sec.121.34. Requirements Concerning Entities Recognized for Creditable Service. 
Requirements for entities recognized for professional personnel are as follows.
(1) Texas public elementary and secondary schools.
(A) All personnel whose positions are described in  s121.41 of this title 
(relating to Minimum Salary Schedule) must be certified by the State of Texas, 
must hold the proper state or national licensure as required by the position 
held, or must have the educational requirements for the job assigned. Regardless 
of the funding source, these personnel must be paid at least the minimum salary 
specified in the Texas State Public Education Compensation Plan.
(B) Professional personnel placed on developmental leaves of absence must be 
paid at least one-half of their state minimum salary by the school district to 
receive service credit for increment purposes.
(C) Special education related service personnel may not receive credit for 
special education related service performed prior to the 1979-1980 school year.
(D) Instructors in Reserve Officer Training Corps (ROTC) programs conducted by 
local school districts must be certified or hold an emergency teaching permit 
and must be paid at least the state minimum salary to receive service credit for 
increment purposes. An emergency teaching permit need not be renewed as long as 
the person continues in the ROTC assignment.
(E) Administrative officers still assigned to their position under the 1975-1976 
grandperson clause which allowed them to remain in their position without having 
to meet college degree requirements are not entitled to claim years of 
experience for service performed prior to the 1975-1976 school year.
(F) Administrative officers who did have a college degree prior to 1975-1976 and 
who were paid at least the minimum salary indicated in the Texas State Public 
Education Compensation Plan for their assignment shall be eligible for salary 
increments for each year, between 1970-1971 and 1975-1976, that they were 
degreed and paid the minimum salary.
(2) Texas regional education service centers.
(A) Personnel employed in cooperatives for which the education service center is 
acting as fiscal agency must meet the same requirements as personnel employed in 
Texas public elementary and secondary schools.
(B) All other personnel must meet the same requirements as personnel employed in 
the Central Education Agency.
(3) Central Education Agency. Professional staff are defined as personnel 
assigned to positions in the administrative or instructional areas equivalent to 
those positions described in sec.121.41.
(4) Texas Department of Corrections-Windham schools. Requirements in paragraph 
(1) of this section pertaining to Texas public elementary and secondary schools 
shall apply.
(5) Public elementary and secondary schools in all other states of the United 
States or within the boundaries of any of its territorial possessions. 
Employment prior to 1990-1991 must have been on a full-time basis.
(6) Overseas schools operated by the United States government.
(A) Schools operated by the United States Government for military dependents and 
dependents of personnel assigned to an embassy, consultate, etc., are treated as 
public schools in other states of the United States and policies pertaining to 
public schools in other states apply.
(B) For information on overseas schools that are not closed, contact the General 
Service Administration, National Personnel Records Officer (Civilian Personnel 
Records), 111 Winnebago Street, St. Louis, Missouri 63118.
(7) Texas public or private colleges or universities.
(A) Accreditation by the Southern Association of Colleges and Schools is 
required.
(B) Instructors in ROTC programs conducted by accredited colleges or 
universities must have been employed fulltime on a faculty status level.
(C) All college or university experience must be recorded on the teacher service 
record. A supporting letter or form must be attached to the teacher service 
record verifying that either the fulltime or parttime employment was at faculty 
status or its equivalent and that the schedule of work and the pay constituted 
that of other similar faculty employees. The commissioner of education shall 
prescribe the form required. It is the responsibility of the employing school 
district to secure verification of college or university experience.
(8) Texas private elementary and secondary schools.
(A) For experience prior to the 1986-1987 school year, accreditation by the 
Central Education Agency or the Southern Association of Colleges and Schools is 
required.
(B) For experience in the 1986-1987, 1987-1988, and 1988-1989 school years, 
service shall be acceptable if the school was accredited by the Central 
Education Agency, a recognized regional accrediting agency, or an association 
recognized by the commissioner of education in accordance with sec.97.7 of this 
title (relating to Non-public Schools).
(C) For experience in the 1989-1990 school year and thereafter, service shall be 
acceptable if the school was accredited by an accrediting association recognized 
by the commissioner of education in accordance with sec.97.7 of this title 
(relating to Non-public Schools).
(D)  During the 1986-1987, 1987-1988, and 1988-1989 school years, private 
schools accredited by the Central Education Agency, a recognized regional 
accrediting agency, or an association recognized by the commissioner of 
education will be listed in the Texas School Directory.
(E) Beginning with the 1989-1990 school year and thereafter, private schools 
accredited by an accrediting association recognized by the commissioner of 
education will be listed in the Texas School Directory.
(9)  Non-public special education contract schools.
(A) Approval from the Central Education Agency to provide special education 
services during the year service was rendered is required. A list of approved 
schools is maintained by the Central Education Agency and is also distributed 
annually to all public schools in Texas.
(B) The person must have been certified in an area of special education.
(10) Texas Department of Mental Health and Mental Retardation state hospitals.
(A) The assignment must have been in an educational program operated in 
conjunction with a public school program.
(B) The person must have held a valid Texas teaching certificate and must have 
been paid at least the state minimum salary of a teacher in a public school.
(11) Texas veteran's vocational school.
(A) The assignment must have been as an instructor or coordinator.
(B) Service during the period of July 1, 1946, through June 30, 1955, must have 
been at a school under the jurisdiction of the Central Education Agency (this 
service can be verified by the agency).
(C) Service after June 30, 1955, must have been at a veteran's vocational school 
operated by a Texas county board of school trustees under the jurisdiction of 
the Veterans Administration.
(12) Public or private colleges and universities, and private elementary and 
secondary schools in all other states in the United States or within the 
boundaries of any of its territorial possessions.
(A)  Employment must have been, and in the case of colleges and universities 
must be, verified in the same manner as for Texas colleges or universities.
(B)  Accreditation by a recognized state or regional accrediting agency in the 
United States is required. In states or territories that have no provisions for 
accrediting, licensing, or approving private elementary or secondary schools, 
service shall be acceptable provided the person held, while employed, a valid 
teaching certificate from the state in which the school is located or a valid 
Texas teaching certificate.
(C) It is the responsibility of the employing school district to have evidence 
on file of the accreditation status of private schools in other states.
(13) Foreign public or private elementary and secondary schools, colleges, and 
universities.
(A)  Employment in colleges or universities must be verified in the same manner 
as for Texas colleges or universities.
(B) For foreign public schools, public colleges, and universities, accreditation 
by a recognized agency of the foreign country or by a recognized accrediting 
agency in the United States is required.
(C) For foreign private schools, private colleges, or universities, 
accreditation must be by a recognized accrediting agency in the United States.
(D) The accreditation status must be verified in the same manner as for public 
or private schools in the United States.
(14)  United States Department of the Interior-Bureau of Indian Affairs. Service 
must have been full-time.
(15) United States service academies.
(A) Employment must have been at a faculty status level and must be verified in 
the same manner as other college or university service.
(B)  The service academies are as follows:
(i) Air Force Academy, Colorado Springs, Colorado:
(ii) Coast Guard Academy, New London, Connecticut;
(iii) Military Academy, West Point, New York;
(iv) Naval Academy, Annapolis, Maryland; and
(v)  Merchant Marine Academy, Kings Point, New York.
(16) United States military service. Service with the military forces of the 
United States of America may be counted for salary increment purposes if the 
following conditions are met.
(A) The person was a professional employee of any entity recognized for 
creditable service for salary increment purposes within 12 months of entry into 
active duty.
(B) Form DD-214 or other official discharge papers must be filed with the 
teacher service record showing:
(i)  that military service was in the capacity of an enlisted man or woman or 
commissioned officer;
(ii) that release or separation from active duty was under honorable conditions; 
and
(iii) dates of entry and release from active duty.
(C) The person claiming military service was on active duty during the periods 
September 1, 1940, through August 31, 1947, or September 1, 1950, through August 
31, 1954, or for other periods if:
(i) the military service was a result of involuntary induction into active duty; 
or
(ii)  the military service was a result of voluntary entry into active duty for 
the first time for the individual, and such initial period of voluntary military 
service claimed as years of service for teacher salary increments does not 
exceed four years.
(D) Beginning with the 1983-1984 school year, for purposes of determining the 
total years of military experience creditable for increment purposes, a year 
shall be considered to begin on July 1 and end June 30. During this period, 4 
1/2 months of service must be acquired for an individual to be entitled to one 
year of experience. Only one year of experience may be earned during any 12-
month period. Prior to the 1983-1984 school year, credit for military service 
was calculated based on the 12-month period from September 1-August 31. Credit 
granted on that basis shall continue to be effective.
(17) Job Corps. The person must have held a valid teaching certificate during 
the period of employment.
(18) Peace Corps.
(A) Employment must have been with a school system (Grades K-12) in a foreign 
country.
(B) The person must have held a valid teaching certificate from any state in the 
United States during the period of employment.
sec.121.35. Credit for Work Experience for Vocational Education Personnel.
(a) In accordance with the Texas Education Code, sec.16.056(b) , effective with 
the 1982-1983 school year, certified vocational education personnel employed for 
at least 50% of the time in an approved vocational position may count up to two 
years of work experience for salary increment purposes if the work experience 
was required for vocational certification.
(b) For purposes of this section, an emergency teaching permit shall be the 
equivalent of a teaching certificate.
(c) Personnel employed in the following areas shall be eligible for credit:
(1) marketing and distributive education;
(2) health occupations;
(3) occupational orientation;
(4)  VEH occupational orientation;
(5) vocational office education;
(6) CVAE office education;
(7) VEH office education;
(8)  vocational data processing;
(9) vocational trades and industry;
(10) CVAE industrial education;
(11) VEH industrial education;
(12) technical education; and
(13) job placement coordinator.
(d) Persons in the following vocational areas of employment may be eligible. 
Individual eligibility must be verified through the Division of Teacher Records, 
Central Education Agency.
(1) homemaking preemployment laboratory (gainful);
(2) counselor;
(3) supervisor; and
(4) administrator.
(e) Once credit for work experience has been granted, the credit shall be 
continued regardless of the position held. For personnel granted credit under 
this section whose employment is split between vocational and non-vocational 
positions, the years granted shall apply to both the vocational and the non-
vocational position.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 18, 1991.
TRD-9113520
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter D. Salary Schedule
19 TAC sec.121.41, sec.121.42
The new sections are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.121.41. Minimum Salary Schedule.
(a) The commissioner of education shall publish annually the state minimum 
salary schedule.
(b) The job classification "administrative officer" is to be used only for those 
positions not requiring certification. Non-certified administrative officers are 
to be assigned functions which do not involve supervising or controlling 
curriculum or professional personnel whose assignments require certification. 
Personnel assignments such as tax assessors, business mangers, directors of 
transportation, maintenance, and grounds personnel, are considered to be 
strictly administrative. At least a bachelor's degree from an accredited college 
or university is required for these positions.
(c) Those personnel assigned to positions in 1975-1976 under the grandfather 
clause will continue to be safeguarded except for those personnel who were 
assigned to positions deleted from or modified by Senate Bill 1 (65th Session). 
All newly assigned personnel must meet the current requirements for the 
positions they hold.
(d) Persons who were serving as part time principals in 1970-1971 and have 
continued in that assignment on the same campus since that time may continue as 
parttime principals on a 10-month basis on any campus regardless of size.
sec.121.42. Extended Service. <ol> School districts may employ personnel covered 
by this section for more than the minimum number of days required. When school 
district extend an employee's number of days of employment beyond the number of 
days specified by state law for that position, the daily rate of pay for the 
days added must be at least equal to the daily rate specified for the minimum 
required days for that position.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 18, 1991.
TRD-9113521
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Chapter 125. Central Education Agency
The Texas Education Agency (TEA) proposes the repeal of  ssec.125.1-125.3, 
125.21-125.23, 125.41, 125.42, 125.81, and 125.82, concerning central education 
agency fund allocations, contracts, and agreements. Senate Bill 1, 71st 
Legislature, requires the State Board of Education (SBOE) to reconsider all 
rules affected by this provision so that any rules adopted on these matters must 
occur under the new rulemaking relationship between the SBOE and the Legislative 
Education Board. The review of the rules is to be conducted over a three-year 
period. All sections of Chapter 125 have been reviewed by the board and are 
being repealed.
Criss Cloudt, director planning coordination has determined that for the first 
five-year period the repeals are in effect there will be no fiscal implications 
for state or local government as a result of enforcing or administering the 
repeals.
Ms. Cloudt also has determined that for each year of the first five years the 
repeals are in effect the public benefit anticipated as a result of enforcing 
the repeals will be a clearer more concise statement of the agency's rule 
authority. There will be no effect on small businesses. There is no anticipated 
economic cost to persons who are required to comply with the repeals as 
proposed.
Comments on the proposal may be submitted to Criss Cloudt, Planning 
Coordination, 1701 North Congress Avenue, Austin, Texas 78701, (512) 463-9701. 
All requests for a public hearing on the proposed repeals submitted in 
accordance with the Administrative Procedure and Texas Register Act must be 
received by the commissioner of education not more than 15 calendar days after 
notice of a proposed change in the section has been published in the  Texas 
Register.
Subchapter A. Interagency Contracts
19 TAC sec.sec.125.1-125.3
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.125.1. General Provisions.
sec.125.2. Requirements for Interagency Contracts.
sec.125.3. Restrictions on Interagency Contracts.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113522
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter B. Contracts for Direct Services to the Central Education Agency
19 TAC sec.sec.125.21-125.23
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.125.21. General Provisions.
sec.125.22. Preparation of Contracts for Direct Services to the Central 
Education Agency.
sec.125.23. Restrictions on Contracts for Direct Services to the Central 
Education Agency.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113523
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter C. Funds Subcontracted for Public Education
19 TAC sec.125.41, sec.125.42
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.125.41. General Provisions.
sec.125.42. Preparation of Subcontracts under the Central Education Agency 
Contracted and Granted Funds.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113524
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
Subchapter E. State Board
19 TAC sec.125.81, sec.125.82
(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 Education 
Agency or in the Texas Register office, Room 245, James Earl Rudder Building, 
1019 Brazos Street, Austin.)
The repeals are proposed under Senate Bill 1, sec.2.25, passed by the 71st 
Legislature, Sixth Called Session, which provides the State Board of Education 
with the authority to review all rules, other than portions of Chapter 75, under 
Title 19, Texas Administrative Code, relating to public education.
sec.125.81. Funds Allocated by the Agency on a Formula Basis.
sec.125.82. Funds Allocated by the Agency on a Discretionary Basis.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 17, 1991.
TRD-9113525
Criss Cloudt
Director, Planning Coordination
Texas Education Agency
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-9701
       
TITLE 22. Examining Boards
Part XV. Texas State Board of Pharmacy
Chapter 291. Pharmacies
22 TAC sec.291.39
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas State 
Board of Pharmacy or in the Texas Register office, Room 245, James Earl Rudder 
Building, 1019 Brazos Street, Austin.)
The Texas State Board of Pharmacy proposes to repeal sec.291.39, concerning 
Class A Pharmacies located in a state other than Texas. The 72nd Legislature 
passed Senate Bill 1497 which gives the Board the authority to license out-of-
state pharmacies as Class E Pharmacies. This bill became effective September 1, 
1991. Since this legislation was passed, the rules which classify out-of-state 
pharmacies as Class A Pharmacies are no longer applicable. Out-of-state (non-
resident) pharmacies will be licensed as specified in Senate Bill 1497 and rules 
for Class E Pharmacies will be promulgated in the near future.
Fred S. Brinkley, Jr., R.Ph., M.B.A., Executive Director/Secretary has 
determined that there will not be fiscal implications as a result of enforcing 
or administering the section.
Comments on the proposed repeal may be submitted to Fred S. Brinkley, Jr., R. 
Ph., Executive Director/Secretary, Texas State Board of Pharmacy 8505 Cross Park 
Drive, Suite 110, Austin, Texas 78754- 4594.
The repeal is proposed under the Texas Pharmacy Act (Texas Civil Statutes, 
Article 4542a-1) sec.16 which gives the Texas State Board of Pharmacy the 
authority to adopt rules for the proper administration and enforcement of the 
Act.
sec.291.39. Pharmacies Located in a State Other than Texas.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on November 4, 1991.
TRD-9113763
Fred S. Brinkley, Jr., R.Ph., M.B.A.
Executive Director/Secretary
Texas State Board of Pharmacy
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 832-0661
       
Part XVIII. Texas State Board of Podiatry Examiners
Chapter 371. Examinations
22 TAC sec.sec.371.1-371.3, 371.5-371.14
The Texas State Board of Podiatry Examiners proposes amendments to sec.sec.371. 
1-371.3, and 371.5-371.14, concerning requirements for examination to become a 
licensed podiatrist. The sections define terms commonly used in the profession, 
set the standards for licensure, and provide an appeals process for students who 
do not qualify to take the examination. The sections are proposed to define what 
a person must do to become a licensed podiatrist.
D. Elliot Branson, executive director, has determined that for the first five-
year period the sections are in effect there will be no fiscal implications for 
state or local government as a result of enforcing or administering the 
sections.
Mr. Branson also has determined that for each year of the first five years the 
sections are in effect the public benefit anticipated as a result of enforcing 
the sections will be more uniform testing. There will be no effect on small 
businesses. There is no anticipated economic cost to persons who are required to 
comply with the sections as proposed.
Comments on the proposal may be submitted to Janie Alonzo, 3420 Executive Center 
Drive, Suite 305, Austin, Texas 78731, (512) 794-0145.
The amendments are proposed under Texas Civil Statutes, Articles 4568(j) and 
4590(e), which provide the State Board of Podiatry Examiners with the authority 
to adopt all reasonable or necessary rules, regulations, and by-laws not 
inconsistent with the law regulating the practice of podiatry, the laws of this 
state, or of the United States; to govern its proceedings and activities, the 
regulation of the practice of podiatry, and the enforcement of the law 
regulating the practice of podiatry.
sec.371.1. Definitions.  The following words and terms, when used in this 
chapter, shall have the following meanings, unless the context clearly indicates 
otherwise.
 Applicant-<nl>A person<ol> [An individual] who applies <nl>to the Texas State 
Board of Podiatry Examiners for a license to practice podiatric medicine in the 
State of Texas.<ol> [to take the examination given by the board.] <nl>A person 
who applies for relicensing, or applies for renewal of his or her license, or 
applies for reinstatement of his or her license after suspension or revocation 
is not an applicant for purposes of this chapter and subsequent chapters.
 Board-The Texas State Board of Podiatry Examiners <nl>as established and 
authorized by the Podiatry Practice Act of Texas, Texas Civil Statutes Article 
4567, et seq<ol>.
 Board member-One <nl>lawfully appointed by the governor to serve a term as set 
by law on the board<ol> [of the appointed members of the decision making-body 
defined as the board].
 Examinee-<nl>A person<ol> [An individual] who has been admitted to take the 
examination <nl>given by or at the direction of the Texas State Board of 
Podiatry Examiners as a requirement for licensing to practice podiatry in the 
State of Texas.
sec.371.2. Application for License.
(a) <nl>Any person<ol> [All individuals] who  <nl>wishes<ol> [wish] to practice 
podiatry in this state, who <nl>is<ol> [are] not otherwise licensed under law, 
must successfully pass an examination given by the board <nl>or given at the 
board's direction pursuant to sec.371.6(e) of this title (relating to Time, 
Place, and Scope of Examinations), and complete the residency requirements as 
set forth herein, sec.371.3(d) of this title (relating to Qualifications of 
Applicants) <ol>. <nl>One who successfully completes all the requirements for 
licensing as set forth in these rules and who has made payment of all applicable 
fees shall be awarded a valid license to practice Podiatry in the State of Texas 
for the term lawfully stipulated by and under the conditions set forth in these 
rules, and the Podiatry Practice Act of Texas, Texas Civil Statutes, Article 
4567B, et seq <ol>.
(b) <nl>Any person<ol> [Individuals] who <nl>wishes to sit for<ol> [seek to take 
such] <nl>examination, <ol> [examination] shall submit a written application on 
a form provided by the board to the secretary-treasurer <nl>of the board<ol>. 
<nl>The applicant shall verify by affidavit the information in the application. 
<ol> [The information contained in the application shall be verified by 
affidavit of the applicant.] <nl>The board may refuse to admit to examination or 
grant a license to any applicant who knowingly submits false information to the 
board.
(c) Applications for examination must be [printed in ink or typewritten] on the 
<nl>board's<ol> [board] <nl>application<ol> form <nl>printed in ink or 
typewritten<ol>, which <nl>shall<ol> [will] be furnished by the secretary-
treasurer <nl>or the board staff <ol> upon request.
(d) The completed application and required supporting materials must be received 
by the secretary-treasurer <nl>or the board staff<ol> no later than 30 days 
before the first day of the examination. The materials supporting the 
application, such as podiatry college transcripts of recent graduates, shall be 
received by the secretary-treasurer before the examination.
(e) The filing of an application and tendering the fee to the secretary-
treasurer <nl>or the board staff<ol> shall not in any way obligate the board to 
admit the applicant to examination until such application has been approved by 
the board as meeting the statutory <nl>and regulatory<ol> requirements for 
admission to the examination for <nl>licensing <ol> [licensure].
(f) The full examination fee is $100. Only certified check, postal service money 
order, or Express Money <nl>Order <ol>, shall be accepted. No examination fee 
will be refunded. The examination fee must be received by the secretary-
treasurer at least 15 days before the <nl>date the applicant is scheduled to 
begin the examination<ol> [dates of the regular examinations].
<nl>(g) A temporary license may be granted by the board to a certified graduate 
of an approved school of podiatry under 371.3(b) who is enrolled in an approved 
internship or residency program under 371.6(d), for a term not to exceed the 
time the graduate is enrolled in said internship or residency program, unless 
the graduate is not practicing in the State of Texas during the term of said 
internship or residency program. In no case is said temporary license to be 
issued for a term to exceed three years, or renewed in successive years for a 
time that cumulatively exceeds three years.
<nl>(h)  A temporary license may be granted by the board to a certified graduate 
of an approved school of podiatry under 371.3(b) who is enrolled in an 
internship or residency program that is pending approval, as defined under 
sec.371.3(d), for a term not to exceed the time the graduate is enrolled in said 
internship or residency program In no case is said temporary license to be 
issued for a term to exceed three years, or renewed in successive years for a 
time that cumulatively exceeds four years. It shall be the sole responsibility 
of the applicant to ascertain the approval status, as defined in sec.371.3(d), 
of the residency program he chooses to attend.
<nl>(i) A temporary licensee granted a temporary license for the purpose of 
pursuing an internship residency program in the State of Texas shall not engage 
in the practice of podiatry, whether for compensation or free of charge, outside 
the scope and limits of the residency program in which he or she is enrolled.
<nl>(j)  A temporary license granted by the board for the purpose of pursuing a 
residency program in the State of Texas shall terminate by operation of law and 
under these rules at the time and on the day that said temporary licensee leaves 
or is terminated from said residency program. Any successive entry into a second 
or further residency program shall be subject to all of the laws and rules and 
application requirements set forth herein.
<nl>(k) All temporary licensees shall be subject to the same fees and Penalties 
as all other licensees as set forth in the Podiatry Practice Act of Texas, 
Article 4567 et seq., including Article 4574 of said Act, and Chapter 376 of 
this title (relating to Violations and Penalties), except that temporary 
licensees are not subject to any board rules concerning continuing education.
sec.371.3. Qualifications of Applicants.
(a) All applicants shall have attained the age of 21 years and <nl>shall have 
never been convicted of a felony or a crime of moral turpitude under the state 
laws of any state or the federal laws of the United States<ol> [be of good moral 
character].
(b)  All applicants shall have completed the number of college courses required 
by the Texas Civil Statutes, Article 4570(b)(3), and graduated from a reputable 
school of podiatry <nl>approved by the board as a college in good standing under 
sec.371.5 of this title (relating to Approved Podiatry School and Colleges in 
the United States). The applicant's entire course of instruction must be from 
such an approved college, and the college must have been so approved during the 
entire course of the applicant's course of instruction.
(c) All applicants shall have successfully completed a course in cardiopulmonary 
resuscitation within the year previous to the <nl>application for licensing <ol> 
[examination] and provide a certification to that effect.
<nl>(d) Every applicant shall have completed at least one year of satisfactory 
post-graduate training with a hospital, clinic, or institution acceptable to the 
board in a residency or internship program approved by the Council of Podiatric 
Medical Education of the American Podiatric Medical Association. Certified 
documentation of enrollment in said postgraduate training must accompany the 
application to the board for examination. Certified documentation of successful 
completion of said postgraduate training must accompany the application to the 
board for licensing. This subsection, becomes effective at 12:01 a.m., July 1, 
1995.
<nl>(e) The board approves and adopts by reference the standards for 
accreditation of residency and internship programs adopted by the Council on 
Graduate Podiatric Medical Education of the American Podiatric Medical 
Association. The standards are available from the Texas State Board of Podiatry 
Examiners, 3420 Executive Center Drive, Suite 305, Austin, Texas 78731. The 
board considers any school of podiatric medicine accredited by the Council on 
Podiatric Medical Education of the American Podiatric Medical Association as a 
school approved by the board.
<nl>(f) <ol>[(d)] The applicant shall submit evidence sufficient for the 
secretary-treasurer <nl>of the board<ol> to determine that the applicant has met 
all the requirements of this section and any other information reasonable 
required by the board. <nl>Any application, diploma or certification, or other 
document required to be submitted to the board that is not in the English 
language must be accompanied by a certified translation thereof into English.
<nl>(g) At the discretion of the board, the residency requirement set forth in 
subsection (d) of this section may be waived if the applicant has been in active 
podiatric practice for at least five continuous years in another state under 
license of that state, and upon application to the board can show an acceptable 
record from that state and from all other states under which the applicant has 
ever been licensed. This subsection expires by operation of law at midnight on 
December 31, 1995.
<nl>(1) A showing of an acceptable record under this subsection of this section 
is defined to include. but is not limited to,a showing that the applicant has 
not had entered against him a judgment, civil or criminal, in state or federal 
court or other judicial forum, on a podiatry-related or medical-related cause of 
action, and no conviction of a felony or a crime or moral turpitude, and no 
disciplinary action recorded from any medical institution or agency or 
organization, including, but not limited to, any licensing board, hospital, 
surgery center, clinic, professional organization, governmental health 
organization or extended-care facility, and no dishonorable discharge from 
military service.
<nl>(2) If any judgment or disciplinary determination under this subsection has 
been, on appeal reversed, reversed and rendered, or remanded and later 
dismissed, or in any other way concluded in favor of the applicant, it shall be 
he applicant's responsibility to bring such result to the notice of the board by 
way of certified letter along with any such explanation of the circumstances as 
the applicant deems pertinent to the board's determination of admittance to 
licensure in the State of Texas.
<nl>(3) The applicant shall obtain and submit to the board a letter from any and 
all state boards under which he or she has ever been previously licensed stating 
that the applicant is a licensee in good standing with each said board or that 
said prior license or licenses were terminated or expires with the licensee in 
good standing.
sec.371.5. Approved Podiatry School and College in the United States.   The 
board shall annually approve those podiatry schools in the United States whose 
graduates are eligible for examination or licensing under the provisions of 
Texas Civil Statutes, Article 4570. <nl>The board approves and adopts by 
reference the standards for accrediting colleges of podiatric medicine adopted 
by the Council on Podiatric Medical Education of the American Podiatric Medical 
Association. The standards are available from the Texas State Board of Podiatry 
Examiners, 3420 Executive Center Drive, Suite 305, Austin, Texas 78731. The 
board considers any school of podiatric medicine accredited by the Council on 
Podiatric Medicine Education of the American Podiatric Medical Association as a 
school approved by the Board.
sec.371.6. Time, Place, and Scope of Examinations.
(a)  Examinations for <nl>licensing, when the examination is conducted by the 
board<ol>, [licensure] shall be conducted in the English language and given 
twice each year, [generally in January and June,] at a place designated by the 
board. A schedule of each examination session <nl>shall<ol> [will] be furnished 
each examinee at the beginning of the examination.
(b) The examination<nl>, when the examination is conducted by the board, 
shall<ol> [may] consist of [two] <nl>different<ol> sections, <nl>including<ol> 
[written and practical] <nl>written, practical, and oral, or any combination of 
such. <ol> [The written portion of the examination covers a period of 
approximately 1 1/2 days. The practical examination covers approximately 1/2 
hour.]
(c)  Examinees<nl>, when the examination is conducted by the board,<ol> shall 
not be permitted to bring medical books, notes, medical journals, or other help 
into the examination room, or to communicate by word or sign with another 
examinee while an examination is in progress without permission of the presiding 
examiner and within the hearing of a designated representative of the board; nor 
shall the examinee leave the examination room except when [so] permitted by the 
presiding examiners and accompanied by a member or an employee of the board.
(d) A license shall not be issued to any person who has been detected in a 
deceptive<nl>, dishonest, <ol> or fraudulent act while an examination is in 
progress. [One designated representative of the board shall be in the 
examination room at all times while an examination is in progress.]
<nl>(e) At the option and in the complete discretion of the board, the 
examination may be conducted, in whole or in part, upon a vote of a majority of 
the board, to any school, institute, or organization that is deemed by the same 
majority of the board to provide adequate and fair examinations of sufficient 
high standards as to continue to insure high-quality practitioners in the State 
of Texas. The manner of examination, the time of examination, and the scheduling 
of the examination, as well as fee requirements and grading operations may then 
be delegated by the board to said school, institute, or organization, provided, 
however, that examination results, grades, and copies of the examination are 
available to the board upon request by the board, and the Board is to maintain a 
record of the examination results.
sec.371.7. Written Examination.
(a) <nl>When examination is conducted by the board, the<ol> [The] subjects 
<nl>on which<ol> the examinee shall be examined [in] on the written portion of 
the examination are anatomy, chemistry, dermatology, material-medical, 
pathology, physiology, microbiology, orthopedics, diagnosis, and podiatry, 
limited in their application to ailments of the human foot.
(b) <nl>When examination is conducted by the board, the<ol> [The] examinee may 
also be examined on the laws and board rules governing the practice of podiatry 
in Texas.
(c) <nl>When examination is conducted by the board, the<ol> [The] type of 
questions <nl>shall<ol> [will] be true-false, multiple-choice, or <nl>short 
answer<ol> [essay]. [Certain times are assigned to each subject for completion.]
sec.371.8. Practical  23>and [-] Oral Examination.
(a)  <nl>When examination is conducted by the board, the oral<ol> [The subjects 
the examinee shall be examined in on the practical] portion of the examination 
<nl>may cover such areas as<ol> [are] physical and podiatric examination and 
diagnosis, surgery, biomechanics, emergencies, and patient care and treatment.
(b) <nl>When examination is conducted by the board, the<ol> [The] practical 
portion of the examination may <nl>cover such areas as<ol> [be conducted orally, 
with the examinee responding to questions posed by one or more board members and 
appointed assistants sitting as an examination panel.] physical and podiatric 
examination and diagnosis, surgery, biomechanics, emergencies, and patient care 
and treatment.
sec.371.9. Grade Requirements.
(a) <nl>When examination is conducted by the board, an<ol> [An] examinee, in 
order to become licensed, must make a grade of not less than 60 in any subject 
given and a general average of 75 in all subjects given.
(b) [Each board member shall determine the credit to be given on the answers to 
the subjects in which examined by that board member, with final review and 
approval of the board.] The discretion of the board <nl>regarding grades <ol> 
[on] the examinations is final<nl>, whether the examination is given in whole or 
in part by the board or by an entity delegated authority by the board to 
examine.
<nl>(c) When examination is conducted by an entity delegated the authority to 
examine, the board at its discretion may translate on a rational and justified 
basis grades or scores reported by that entity into equivalent scores of an 
examination were it conducted by the board.
sec.371.10. Reexaminations.
(a) (No change.)
(b) All reexaminations shall be in all subjects,  <nl>whether<ol> [both] written 
<nl>,<ol> [and] practical <nl>or oral,<ol> and a reexaminee must satisfactorily 
pass [such examination in] all <nl>portions of the examination<ol> [subjects], 
regardless of the grades made by <nl>the<ol> [such] examinee in <nl>any 
prior<ol> [the original] examination.
sec.371.11. Preparation of Questions.
(a) <nl>When examination is conducted by the board, <ol> [At the end of each 
examination session,] the president shall assign each <nl>licensed<ol> board 
member the responsibility of preparing questions in one or more of the required 
subject areas <nl>or portions of<ol> for the next examination.
(b) <nl>When examination is conducted by the board, questions written or 
designed by a particular licensed board member shall ordinarily also be graded 
by that same board member.<ol> [The board member who prepares the questions in 
the required subjects, if still a member of the board at the next examination, 
shall grade the answers to those questions during the next examination.]
(c) <nl>When examination is conducted by the board, the president of the board 
at his discretion may assign any portion of the exam or any subject area of 
examination to any particular board member or members.<ol> [The assignment of 
subject areas to board members may be rotated among the board members, at the 
discretion of the president.]
sec.371.12. Assistance with Examinations.
(a) <nl>When the oral or practical portion of the examination is conducted by 
the board, other licensed podiatrists may assist when the number of examinees 
might cause<ol> [Where many applicants seek to take the examination and this 
would cause] the examination [session] to exceed a reasonable length of 
time<nl>.<ol> [, the board may have licensed podiatrists to assist the board in 
conducting the practical portion of the examination.]
(b) <nl>A<ol> [Any] podiatrist who assists the board in examinations shall be 
licensed in <nl>Texas <ol> [this area] and  <nl>shall<ol> have at least five 
years of active podiatry practice. If possible, such assistants <nl>shall <ol> 
[will] be past members of the board.
(c) [When assistants are used, the] <nl>The <ol> majority of <nl>any <ol> [the] 
panel <nl>that <ol> [or panels which] gives the practical <nl>or oral<ol> 
portion of the examination shall be  <nl>current<ol> board members.
(d) Only <nl>current<ol> board members <nl>shall<ol> [may] decide whether an 
examinee passes or fails.
 sec.371.13. Notification of Grades.
<nl>(a) When examination is conducted by the board, within<ol> [Within] 60 days 
from the date of the examination, the secretary-treasurer shall notify each 
examinee the grade made in each subject and the general average made on the 
examination and whether the examinee passes or fails.
<nl>(b) When examination is delegated to another entity, the board shall do 
everything reasonably necessary to assist in the timely reporting of examination 
results to examinees.
sec.371.14. Disgualification to Take Examination.
(a) (No change.)
(b) Hearings involving few issues on whether an applicant is qualified to take 
the examination <nl>shall<ol> [will] be held by the full board [just] prior to 
the examination.
(c) Hearings involving extensive evidence on whether an applicant is qualified 
to take the examination <nl>shall <ol> [will] be held as soon as possible after 
the secretary-treasurer receives the application. This type of hearing 
<nl>shall<ol> [will] be conducted by the board or a hearing officer, as defined 
by sec.377.1 of this title (relating to Definitions).
(d) If the hearing is held immediately preceding the examination, the board, if 
possible, <nl>shall<ol> [will] determine whether the applicant is eligible to 
take the examination before the examination begins. However, if the hearing is 
not completed by the time the examination is scheduled to begin, the board may 
recess such hearing and in such cases, the applicant or other applicants who 
have not had a hearing <nl>shall<ol> [will] be allowed to take the examination. 
However, the examination grades of all such applicants <nl>shall<ol> [will] not 
be disclosed to the applicants until after their eligibility to take the 
examination is finally determined.
(e) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 31, 1991.
TRD-9113703
Janie Alonzo
Administrative Technician II
Texas State Board of Podiatary Examiners
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-0145
       
Chapter 373. Identification of Practice
22 TAC sec.sec.373.1, 373.2, 373.6, 373.7
(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 State 
Board of Podiatry Examiners or in the Texas Register office, Room 245, James 
Earl Rudder Building, 1019 Brazos Street, Austin.)
The Texas State Board of Podiatry Examiners proposes the repeal of sec.sec.373. 
1, 373.2, 373.6, and 373.7, concerning identification of practice. These rules 
are very vague and no longer used nor enforced by the board.
D. Elliot Branson, executive director, has determined that for the first five-
year period the repeals are in effect there will be no fiscal implications for 
state or local government as a result of enforcing or administering the repeals.
Mr. Branson also has determined that for each year of the first five years the 
repeals are in effect the public benefit anticipated as a result of enforcing 
the repeals will be better clarity in the rules. There will be no effect on 
small businesses. There is no anticipated economic cost to persons who are 
required to comply with the repeals as proposed.
Comments on the proposal may be submitted to Janie Alonzo, 3420 Executive Center 
Drive, Suite 305, Austin, Texas 78731, (512) 794-0145.
The repeals are proposed under Texas Civil Statutes, Articles 4568(j) and 
4590(e), which provide the State Board of Podiatry Examiners with the authority 
to adopt all reasonable or necessary rules, regulations, and by-laws not 
consistant with the law regulating the practice of podiatary, the laws of this 
state, or of the United States; to govern its proceedings and activities, the 
regulation of the practice of podiatry, and the enforcement of the law 
regulating the practice of podiatry.
sec.373.1. Definitions.
sec.373.2. Practitioner.
sec.373.6. Trade Names and Assumed Names.
sec.373.7. Associations with Practitioners of Other Branches of the Healing 
Arts.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 31, 1991.
TRD-9113704
Janie Alonzo
Administrative Technician II
Texas State Board of Podiatry Examiners
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-0145
       
22 TAC sec.sec.373.1, 373.2, 373.4, 373.6, 373.7
The Texas State Board of Podiatry Examiners proposes new  ssec.373.1, 373.2, 
373.4, 373.6, and 373.7, concerning identification of practice. The new sections 
define terms commonly used in the profession, practitioner identification, the 
use of trade name and assumed names, healing art identifications and violations. 
The sections are proposed to define the use of trade names and professional 
designations.
D. Elliot Branson, executive director, has determined that for the first five-
year period the sections are in effect there will be no fiscal implications for 
state or local government as a result of enforcing or administering the 
sections.
Mr. Branson also has determined that for each year of the first five years the 
sections are in effect the public benefit anticipated as a result of enforcing 
the sections will be better clarity in the rules. There will be no effect on 
small businesses. There is no anticipated economic cost to persons who are 
required to comply with the sections as proposed.
Comments on the proposal may be submitted to Janie Alonzo, 3420 Executive Center 
Drive, Suite 305, Austin, Texas 78731, (512) 794-0145.
The new sections are proposed under Texas Civil Statutes, Articles 4568(j) and 
4590(e), which provides the State Board of Podiatry Examiners with the authority 
to adopt all reasonable or necessary rules, regulations, and by-laws not 
consistant with the law regulating the practice of podiatry, the laws of this 
state, or of the United States; to govern its proceedings and activities, the 
regulation of the practice of podiatry, and the enforcement of the law 
regulating the practice of podiatry.
sec.373.1. Definitions.  The following words and terms, when used in this 
chapter, shall have the following meanings, unless the context clearly indicates 
otherwise.
 Board-The Texas State Board of Podiatry Examiners as established and authorized 
by the Podiatry Practice Act of Texas, Texas Civil Statutes, Article 4567B, et 
seq.
 Publication-Any and all public communications relating to the podiatrists 
practice, including but not limited to, advertisements, announcements, 
invitations, press releases, journal articles, periodical articles, leaflets, 
news stories, materials distributed by private or by United States mail, and 
signs or placards placed in public view.
 Practitioner-A person validly licensed by the Texas State Board of Podiatry 
Examiners to practice podiatry in the State of Texas for a term set by law.
sec.373.2. Practitioner Identification.
(a) A licensed practitioner of podiatry shall always in any publication that 
includes his name use only the authorized designation to professionally identify 
himself or herself. Authorized designations for a podiatrist are limited to the 
following: Doctor of Podiatric Medicine, D.P.M., Doctor of Podiatry, Podiatrist, 
Podiatric Doctor, Podiatric Physician.
(b) A practitioner shall always in any publication that includes the name of his 
practice use an authorized designation to professionally identify his practice. 
Authorized designations for a podiatrists practice are limited to the following: 
Foot Surgeon, Podiatric Surgeon, Foot Specialist, Doctor and Surgeon of the 
Foot, Injuries and Diseases of the Foot, Podiatric Physician.
(c) The purpose of this subsection and of so limiting the professional 
designations of a podiatrist and his practice is to insure that the public and 
all prospective patients are reasonably informed of the distinction between 
podiatrists and other medical practitioners as is reflected by the difference in 
training and licensing and the scope of practice.
(d) If a practitioner creates a professional corporation to conduct his 
practice, he shall, to identify his practice, use an authorized designation 
followed by one of the suffixed listed in sec.373.5 of this title (relating to 
Professional Corporations). Examples: John Doe, D.P.M., A. Prof. Corp.; Dr. John 
Doe, Podiatrist, Inc.
(e) A practitioner shall not use a trade name or assumed name to identify his 
practice, except as authorized in sec.373.4 of this title (relating to Trade 
Names and Assumed Names) with respect to clinics, and specifically limited by 
sec.373.4(d) of this title (relating to Trade Names and Assumed Names).
sec.373.4. Trade Names and Assumed Names.
(a) A podiatrist desiring a ruling on the use of a trade name or assumed name to 
identify a group of podiatrists with which he is practicing, or a podiatry 
clinic in which he practices shall submit the name to the board for review and 
approval.
(b)  The board shall approve a trade name or assumed name that:
(1)  includes a word or words indicating the practice specialty is podiatry;
(2) fairly and objectively identifies the practice; and
(3)  complies with sec.375.3 of this title (relating to Advertising).
(c)  If a name is disapproved, the board shall notify in writing the party 
requesting the ruling on the name and set forth the reasons for disapproval.
(d) The term "clinic" may be used in the name identifying a podiatry practice 
only if the practice is conducted in connection with a medical or podiatry 
school or hospital, or if the podiatrist is practicing in a group composed of 
practitioners from different branches of the healing art, or if the group is 
composed of three or more podiatrists specializing in different fields or 
branches of podiatric medicine. Examples of names acceptable under this 
subsection are "Stephenville Community Hospital Podiatry Clinic" and "State 
Medical School Foot Clinic".
(e) Within any advertisement or like publication that includes the name of the 
group or clinic, each podiatrist in the group or clinic shall also publish his 
own name and professionally identify himself in the manner provided in 
sec.373.2(a) or (b) of this title (relating to Practitioner Identification), as 
applicable.
(f) Any person who violates any provisions of this subsection, sec.373.4 of this 
title (relating to Trade Names and Assumed Names), or a determination of the 
board hereunder, is subject to a civil penalty pursuant to Chapter 376 et seq. 
of these Rules of up to $500 for each day of violation, as provided in Texas 
Civil Statutes, Article 4568a, not to exceed the maximum penalty amount set 
forth in Chapter 376 herein.
sec.373.6. Associations with Practitioners of Other Branches of the Healing Art.  
A podiatrist practicing in a group composed of practitioners from different 
branches of the healing arts may practice under a trade name or assumed name 
adopted by the group, provided the name is first submitted to and approved by 
the board in accordance with the standards specified in  s373.4(b) (2) and (3) 
of this title (relating to Trade Names and Assumed Names). In addition, within 
the group, the podiatrist shall identify himself in the manner provided in 
sec.373.2(a) or (b) of this title (relating to Practitioner Identification), as 
applicable.
sec.373.7. Violations.
(a) Any person who violates this Chapter 373 et seq., or a determination of the 
board hereunder is subject to a civil penalty of up to $500 for each day of 
violation, as provided in Texas Civil Statutes, Article 4568a and Chapter 376 of 
these rules.
(b) In addition, failure of a podiatrist licensed by the board to identify his 
practice consistent with this chapter is subject to the penalties provided by 
Texas Civil Statutes, Article 4573, and by Chapter 376 of these rules.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 31, 1991.
TRD-9113705
Janie Alonzo
Administrative Technician II
Texas State Board of Podiatry Examiners
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-0145
       
Chapter 375. Rules Governing Conduct
22 TAC sec.375.3
The Texas State Board of Podiatry Examiners proposes an amendment to sec.375. 3, 
concerning rules governing conduct. This section is concerning advertising. It 
sets the standards in which a podiatrist may advertise. The section is proposed 
to define what guidelines a podiatrist must follow when placing an 
advertisement.
D. Elliot Branson, executive director, has determined that for the first five-
year period the section is in effect there will be no fiscal implications for 
state or local government as a result of enforcing or administering the section.
Mr. Branson also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be better clarity of the rules. There will be no effect on small 
businesses. There is no anticipated economic cost to persons who are required to 
comply with the section as proposed.
Comments on the proposal may be submitted to Janie Alonzo, 3420 Executive Center 
Drive, Suite 305, Austin, Texas 78731, (512) 794-0145.
The amendment is proposed under Texas Civil Statutes, Articles 4568(j) and 
4590(e), which provide the State Board of Podiatry Examiners with the authority 
to adopt all reasonable or necessary rules, regulations, and by-laws not 
inconsistent with the law regulating the practice of podiatry, the laws of this 
state, or of the United States; to govern its proceedings and activities, the 
regulation of the practice of podiatry, and the enforcement of the law 
regulating the practice of podiatry.
sec.375.3. Advertising.
(a) A podiatrist may advertise. <nl>A<ol> [However, a] podiatrist shall not<nl>, 
however,<ol> use or participate in the use of any <nl>publication, including 
advertisements, news stories, press releases, and periodical articles,<ol> 
[public communication or advertisement, which] <nl>that<ol> contains a false, 
fraudulent, misleading, deceptive, <nl>scientifically unsupported or generally 
unaccepted,<ol> or unfair statement or claim.
(b)  A false, fraudulent, misleading, deceptive,  <nl>scientifically unsupported 
or generally unaccepted,<ol> or unfair statement or claim includes, but is not 
limited to, a statement or claim <nl>that<ol> [which]:
(1) contains a misrepresentation of fact<nl>, or claims as fact something that 
has not been generally accepted among the podiatric community or by the board as 
having been proven or established as fact;
(2) is likely to mislead or deceive <nl>or entice or persuade a reasonable 
person<ol> because it fails to make full disclosure of relevant facts 
<nl>whether regarding fees, modes of treatment, conditions or techniques of 
surgery, post-operative conditions such as degree of pain, length of time of 
recovery, mobility and strength during recovery, and the like;
(3) is intended or likely to create <nl>in an ordinary reasonable person <ol> 
false or unjustified expectations of favorable results;
(4)<nl> states or<ol> implies educational or professional attainments or 
licensing recognition not supported in fact;
(5) states or implies that the podiatrist has received formal recognition as a 
specialist<nl>,<ol> or <nl>has<ol> [claim] any specialized expertise [in any 
aspect of the practice of podiatry,] if this is not the case;
<nl>(6)  contains any testimonial or laudatory statement, or other statement or 
implication that the podiatrist's services are of exceptional quality;
[(6) contains other representations or implications that in reasonable 
probability will cause an ordinary prudent person to misunderstand or be 
deceived.]
<nl>(7) contains statistical data or information that reflects or is intended to 
reflect quality or degree of success of past performance, or prediction of 
future success;
(8)<nl> represents that podiatric services can or will be completely performed 
for a stated fee amount when this is not the case, or makes representations with 
respect to fees that do not disclose all variables affecting the fees, or makes 
representations that might reasonably cause an ordinary prudent person to 
misunderstand or be deceived about the fee amount.
(c) Information contained in a public communication by a podiatrist may include, 
but is not limited to the following:
(1)-(2) (No change.)
(3) professional memberships and attainments <nl>and <ol> certifications, 
subject, however, to the provisions of subsection (e) of this title section;
(4) description of services offered, <nl>subject, however to the provisions of 
subsection(f) of this title section;
(5) (No change.)
(6) acceptable credit arrangements, subject, however, to the provisions of 
subsection (b)(2) and (8) of this title section;
(7)-(9) (No change.)
(10) fixed fees for specific podiatric treatments and services, <nl>subject, 
however, to the provisions of subsection (b)(2) and (8) of this section;<ol> and
(11) (No change.)
(d)  (No change.)
<nl>(e) A podiatrist may advertise or publish the name of any board of 
certification under which the podiatrist has fully and validly become certified 
provided, however, that:
<nl>(1) the full name of the certifying board is included in the publication; 
that is, no advertisement or publication may include the bare phrase "board 
certified" or the like;
<nl>(2) the advertisement or publication must also include a clearly legible 
notation, if true, that such board of certification is not one approved or 
recognized by the Council on Podiatric Medical Education of the American 
Podiatric Medical Association;
<nl>(3) it shall be the duty of each podiatrist to timely ascertain before 
publication of any such advertisement or public communication whether the 
certifying board he wished to advertise is in fact approved or recognized by the 
Council on Podiatric Medical Education of the American Podiatric Medical 
Association.
<nl>(f) If a publication by or for a podiatrist includes mention of a particular 
surgical technique or device, such as laser surgery, minimal incision surgery, 
laser bunion surgery or similar particular techniques or devices, the 
publication must also include a specific and true statement that reveals to an 
ordinary reasonable person the limits and scope and specific purpose of the 
technique so as not to mislead an ordinary reasonable person regarding the 
difficulty, pain or discomfort, length of time for surgery or recuperation, or 
possibility of complications.
<nl>(g) Within the advertisement section of any published or publicly 
distributed telephone directory, where the profession of podiatry is a plainly 
visible rubric under which only licensed podiatrists appear in print, the rubric 
itself shall suffice to identify the practice or the licensee as a podiatrist 
where the listing is an in-column advertisement; where the advertisement is a 
block advertisement, even if it falls under such a plain rubric, the block 
advertisement must contain within its own borders the identifications required 
by sec.373.2 of this title (relating to Practitioner Identification) and 
sec.373.4 of this title (relating to Trade Names and Assumed Names) herein. If 
shall be the sole responsibility of the licensee to insure that advertisements 
and listings published in any telephone directory are accurate and conform to 
the rules set forth by the board.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 31, 1991.
TRD-9113706
Janie Alonzo
Administration Technician II
Texas State Board of Podiatry Examiners
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-0145
       
22 TAC sec.375.12
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas State 
Board of Podiatry Examiners or in the Texas Register office, Room 245, James 
Earl Rudder Building, 1019 Brazos Street, Austin.)
The Texas State Board of Podiatry Examiners proposes the repeal of sec.375. 12, 
concerning rules governing conduct. These rules concerning violations are very 
vague and no longer used nor enforced by the board.
D. Elliot Branson, executive director, has determined that for the first five-
year period the repeal is in effect there will be no fiscal implications for 
state or local government as a result of enforcing or administering the repeal.
Mr. Branson also has determined that for each year of the first five years the 
repeal is in effect the public benefit anticipated as a result of enforcing the 
repeals will be better clarity in the rules. There will be no effect on small 
businesses. There is no anticipated economic cost to persons who are required to 
comply with the repeal as proposed.
Comments on the proposal may be submitted to Janie Alonzo, 3420 Executive Center 
Drive, Suite 305, Austin, Texas 78731, (512) 794-0145.
The repeal is proposed under Texas Civil Statutes, Articles 4568(j) and 4590(e), 
which provide the State Board of Podiatry Examiners with the authority to adopt 
all reasonable or necessary rules, regulations, and by-laws not consistant with 
the law regulating the practice of podiatry, the laws of this state, or of the 
United States; to govern its proceedings and activities, the regulation of the 
practice of podiatry, and the enforcement of the law regulating the practice of 
podiatry.
sec.375.12. Violations.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 31, 1991.
TRD-9113707
Janie Alonzo
Administrative Technician II
Texas State Board of Podiatry Examiners
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-0145
       
Chapter 376. Violations and Penalties
22 TAC sec.sec.376.1-376.7
The Texas State Board of Podiatry Examiners proposes new  ssec.376.1-376.7, 
concerning violations and penalties. The new section indicates the types of 
penalties that can be assessed when a podiatrist is found to be in violation of 
the Podiatry Practice Act.
D. Elliot Branson, executive director has determined that for the first five-
year period the sections are in effect there will be no fiscal implications for 
state or local government as a result of enforcing or administering the 
sections.
Mr. Branson also has determined that for each year of the first five years the 
sections are in effect the public benefit anticipated as a result of enforcing 
the sections will be better clarity in the rules. There will be no effect on 
small businesses. There is no anticipated economic cost to persons who are 
required to comply with the sections as proposed.
Comments on the proposal may be submitted to Janie Alonzo, 3420 Executive Center 
Drive, Suite 305, Austin, Texas 78731, (512) 794-0145.
The new sections are proposed under Texas Civil Statutes, Articles 4568(j) and 
4590(e), which provides the State Board of Podiatry Examiners with the authority 
to adopt all reasonable or necessary rules, regulations, and by-laws not 
consistant with the law regulating the practice of podiatry, the laws of this 
state, or of the United States; to govern its proceedings and activities, the 
regulation of the practice of podiatry, and the enforcement of the law 
regulating the practice of podiatry.
sec.376.1. Penalties.
(a) Any podiatrist who violates any provision of these rules, or any provision 
of the Podiatry Practice Act of Texas shall be, at the discretion of the board, 
subject to the following penalties:
(1) suspension, revocation, or cancellation of his or her license to practice 
podiatry in the State of Texas; or
(2) a fine not to exceed $10, 000; or
(3) a reprimand by the Board which may be either public or private; or
(4) valid enrollment in and certified full and complete attendance at any 
medical educational course or courses, including any residency, or, any course 
in ethics in practice, as deemed appropriate by the board; or
(5) valid enrollment in and certified full and complete attendance at any 
rehabilitation program deemed appropriate by the board; or
(6) any combination of the above.
(b) All such penalties shall be made a permanent part of the licensees record at 
the Texas State Board of Podiatry Examiners offices which is to be maintained 
according to the Laws of the State of Texas and these Rules and Regulations.
sec.376.2. Probation of Penalty. A board order to revoke, cancel, or suspend a 
license may be probated in whole or in part at the discretion of the board. The 
board may revoke, in part or in whole, the probation of any suspension upon a 
showing of any violation of Statutes or Administrative Rules governing the 
practice of Podiatry, or any state or federal laws, upon hearing before the 
board without the necessity of pre-hearing discovery, or informal conference 
provided the licensee is given reasonable notice and time to respond before the 
board at said hearing.
sec.376.3. Institution of Action by the Board.  The board may institute action 
in its own name to enjoin a violation of any provision of the Podiatry Practice 
Act of Texas, Texas Civil Statutes, Article 4567B et seq., of the Rules of the 
Texas State Board of Podiatry Examiners, or any other laws applicable to 
licensed podiatrists in the State of Texas.
sec.376.4. Board Discretion Regarding Penalties. The board shall have complete 
discretion to impose penalties as are reasonable and fair and in accordance with 
due process in light of all the evidence adduced in each case, the difficulty or 
proof of elements of the case, the credibility of evidence or witnesses for the 
state or the licensee, the harm caused by the violation, and other similar 
considerations, including a comparison with the penalties previously assessed in 
similar cases and circumstances.
sec.376.5. Agreed Orders. <ol> The board may enter into negotiated agreed orders 
with negotiated penalties when, in the board's discretion, full hearing of the 
case is impractical, unnecessary, or not in the best interest of the State due 
to such factors as difficulties in pursuing discovery, risk of obtaining 
adequate evidence or proof, or the length of time accrued since the alleged 
violation and the possibility of stale evidence, and other similar 
considerations.
sec.376.6. Conditions of Suspension of License.
(a) Suspension of a license means that the office of the licensee is to be 
closed for the purposes of receiving, diagnosing, treating, or consulting with 
patients, and the licensee may not participate for income in any professional 
activity that is directly related to diagnosis or treatment of a patient. The 
licensee may refer his patients to another practitioner for treatment or 
consultation during the pendency of the suspension, but the licensee shall not 
derive any income from such referrals. The licensee may allow into his office 
another practitioner to see his patients during the pendency of the suspension, 
but the licensee shall derive no income from the other practitioner by way of 
referral fees, rent for the office space, or the like.
(b) The licensee's office may remain open for the purposes of administrative 
work, including making future appointments, arranging referrals, handling mail, 
processing accounts, billing, and insurance matters, and other similar matters 
not directly related to the diagnosis and treatment of patients.
(c) If the suspended licensee shares offices with another practitioner, the 
other practitioner shall be allowed to continue his practice normally, but the 
suspended licensee shall not share income with the other practitioner, including 
any income derived in any way from the diagnosis or treatment of patients that 
would see or normally see the licensee who is under suspension.
sec.376.7. Educational Courses. <ol> The board deems as approved any Continuing 
Medical Education Course approved by the American Podiatric Medical Association. 
The board may also approve, by majority vote, substitution of a non-APMA-
approved course when such is indicated by the record before the board.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 31, 1991.
TRD-9113708
Janie Alonzo
Administrative Technician II
Texas State Board of Podiatry Examiners
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 794-0145
       
TITLE 25. HEALTH SERVICES
Part I. Texas Department of Health
Chapter 145. Long-Term Care
Subchapter E. Procedures on Long Term Care Facilities
25 TAC sec.145.91
The Texas Department of Health (department) proposes an amendment to sec.145.91, 
concerning administrative penalties for nursing homes. The administrative 
penalties rules were first implemented in June 1986. On September 25, 1990, the 
Board of Health adopted an amendment to sec.145.91 which stated that when the 
Texas Department of Human Services remedies (liquidated damages) system became 
effective, the department's administrative penalties would only apply to 
licensed nursing facilities which do not participate in the Medicaid program. 
This amendment was to prevent the application of a dual penalties system to 
licensed and Medicaid certified nursing facilities. Based on a review of the 
Health and Safety Code, Chapter 242, concerns recently expressed by the 
Governor's Office, and recent federal law and requirements for nursing 
facilities which focus on resident care outcomes, the amendment does the 
following: makes the administrative penalties applicable to all licensed nursing 
homes (facilities); eliminates evidentiary obstacles; removes the provision for 
only issuing a warning for certain violations; removes the options to waive an 
administrative penalty assessment if the facility is subject to other penalties, 
administrative sanctions, or disciplinary/punitive actions; removes the 
provision for a 50% reduction in fines for those paid within a certain time 
frame for certain uncontested cases; reduces the number of elements on which 
penalties may be assessed; increases fees in the fee schedule to better reflect 
the cost for imposing administrative penalties; and deletes references to 
specific minimum licensing standards so the penalty element stands on its own 
merit.
Stephen Seale, chief accountant III, Budget Office, has determined that for the 
first five-year period the section is in effect there will be fiscal for state 
government implications as a result of enforcing or administering the section. 
The effect on state government for each year of the five-year period will be an 
estimated additional cost of $252,000 based on an additional employee to perform 
technical management of the system and program and legal staff participation in 
appeal hearings requested by facilities. The department currently participates 
in approximately 10 administrative penalty appeal hearings annually. It is 
estimated that the number of appeal hearings would increase to approximately 120 
annually under the proposed amendments.
Mr. Seale has also determined that there would be a potential increase of 
$163,925 each year in state revenue based on administration of the section as 
proposed. This increase in revenue cannot be considered to offset the increased 
cost to the department since the funds would be deposited directly to general 
revenue and not to the credit of the department. There will be no fiscal 
implications for local government.
Mr. Seale has also determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be that nursing home residents will be better protected from poor 
care outcomes; the administrative penalty rules will be more clearly understood 
by the consumer, the public, the providers and the regulatory staff; the 
department will be better able to responsibly regulate long term care 
facilities; and to replace the existing fee schedule with a new one which will 
contain penalty elements that focus on resident care outcomes and issues which 
directly affect the quality of resident care.
Additionally, Mr. Seale has determined that for each year of the first five-year 
period the proposed section is in effect there may be a fiscal impact on small 
(four-100 beds) and on large (101-397 beds) nursing homes as a result of 
administering the section as proposed. If small and large nursing homes comply 
with the state licensing and Medicaid requirements and the administrative 
penalty rules, they should not experience any fiscal impact. However if they do 
not comply, the estimated additional cost to a small nursing home assessed a 
penalty under the proposed section could range from $12.50 to $133 per bed per 
first occurrence. In a large nursing home, the estimated additional cost of a 
penalty assessed under the proposed section could range from $3.15 to $39.60 per 
bed per first occurrence. There is no anticipated cost to persons who are 
required to comply with the section as proposed. There is no anticipatated 
effect on local employment.
Comments on the proposal may be submitted to Richard L. Butler, Chief, Bureau of 
Long Term Care, Texas Department of Health, 1100 West 49th Street, Austin, Texas 
78756-3185. Comments will be accepted for 60 days following the date of 
publication of this proposal in the Texas Register . In addition, a public 
hearings will be held as follows: Additional hearings will be held on 9:00 A.M., 
Friday, November 22, Texas Department of Health Auditorium, 1100 W. 49th Street, 
Austin, Texas (Program Contact: Mary C. Sidelnik, Bureau of Long Term Care, 
(512) 458-7709); 9:30 a.m., Tuesday, December 3, 1991, Metropolitan Multi-
Service Center, 1475 W. Gray, Houston, Texas (713) 529-4711 (Program Contact: 
Don Thompson, Houston Long Term Care Unit, (713) 961-7600); 9:00 a.m., 
Wednesday, December 11, 1991, Arlington Community Center, Art Room, 2800 S. 
Center, (Center & Matlock), Arlington, Texas (817) 465-6661 (Program Contact: 
Ron Haygood, Arlington Long Term Care Unit, (817) 792-7270; 10:30 a.m., 
Thursday, December 12, 1991, Texas Department of Health, 1109 Kemper Street, 
Lubbock, Texas (806) 744-3577 (Program Contact: Ralph Harmon, Lubbock Long Term 
Care Unit, (806) 655-7151).
The amendment is proposed under the Health and Safety Code, sec.242.037, which 
provides the Board of Health with authority to adopt minimum standards 
concerning long term care facilities; sec.sec.242.066-242.069, which provides 
the department with authority to assess administrative penalties and to take 
related conditions concerning long term care facilities; sec.12.001, which 
provides the Board of Health with the authority to adopt rules for the 
performance of every duty imposed by law on the Board of Health, the Texas 
Department of Health, and the commissioner of health. This proposed amendment 
will affect the Health and Safety Code, Chapter 242.
sec.145.91. Administrative Penalties.
(a) The Texas Department of Health will administer a program of administrative 
penalties as authorized by the Health and Safety Code, sec.sec.242.066-242.069, 
and as described in this section. The penalties shall apply to all nursing homes 
licensed under the Health and Safety Code, Chapter 242 [, until the Texas 
Department of Human Services adopts its remedies system in 40 TAC sec.16.1510 
and sec.19.2012 under the authority of the Human Resources Code, Title 2, 
Chapters 22 and 32. When the remedies system is adopted by the Texas Department 
of Human Services and becomes effective, the penalties shall only apply to 
licensed nursing homes which do not participate in the Medicaid Program].
(b) When a [deficiency/]violation cited by department staff is determined to be 
within the scope and description of a condition or element of a condition as 
stated in subsection <nl>(p)<ol> [(r)] of this section, known as the schedule, 
the [deficiency/]violation is cause for assessment of penalty as described 
herein and as listed in the schedule.
[(1) For inclusion, a deficiency/violation is:
[(A)  of a magnitude or nature as to limit the facility's ability to meet and 
maintain compliance with the statutes, licensing and related standards, or 
separate and independent conditions or elements described or referenced in 
subsection (r) of this section; and
[(B) of a magnitude or nature as to warrant action beyond the citation of a 
deficiency/violation only.
[(2) In determining whether a deficiency/violation limits the facility's ability 
to comply with statutes, standards, or separate and independent conditions 
described in paragraph (1)(A) of this subsection, and whether the action as 
described in paragraph (1)(B) of this subsection is needed, a 
deficiency/violation must be:
[(A) of a number of existing simultaneous occurrences such that a pattern or 
trend is established; or
[(B) of a state which has a pattern of recurrence during the period of time 
appropriate in establishing a basis for findings that applies to the type of 
visit being conducted; or
[(C) of a type presenting danger to the health or safety of at least one 
resident and the facility does not or did not take immediate corrective action 
at the beginning of the danger; or
[(D) of a magnitude or nature that constitutes a health or safety hazard having 
a direct or imminent adverse effect on resident health, safety, or security, or 
which presents even more serious danger or harm.]
(c) The criteria for penalty assessment applies to all licensed facilities 
specified in subsection (a) of this section [, except as is otherwise described 
in this section].
(d) (No change.)
(e) The methods used in gathering information and determining information 
applicability in citing a [deficiency/] violation will be the same usual and 
normal methods used which lead to citing [deficiencies/] violations that may be 
applicable to other discplinary actions available to the department.
(f) (No change.)
(g) Penalties will be assessed as a result of conditions or elements of 
conditions observed or substantiated during on-site visits by department staff, 
<nl>by either direct observation or record review<ol> [except that a penalty may 
be assessed for failure to report an incident of abuse or neglect on evidence 
gathered or furnished other than through on-site investigation].
(h) If an on-site visit conducted by department staff reveals that a condition 
or element of a condition requiring penalty exists, the recommended penalty will 
be as shown in the applicable column of the schedule, [except as determined 
otherwise when a warning provision described in this subsection is applicable or 
when subsections (k) or (p) of this section are applicable,] regardless of the 
number of days on-site that are necessary to complete the purpose or purposes of 
the visit; hence, the penalty assessments are on a per visit basis and not on a 
daily basis. [Except for deficiencies/violations in conditions or elements 
identified as A; B1, 2, 3, 4; C; D; E1, 2, 4; F1, 4: G1; I1, 2; J1; L1; M1, 2, 
7, 8; P1, 2e, 5a, 6a, 6b, 7a, 7b, 8a, 10a, 11a, 12a, 13a; Q; R; S1; and T, the 
facility will be given a warning on the first occurrence. No facility shall be 
penalized because of a physician's or consultant's nonperformance beyond the 
facility's control or if the violation is beyond the facility's control, if the 
situation is clearly documented.]
(i) The first occurrence of a condition or element of a condition of the 
schedule carries a penalty as shown in the first penalty amount column of the 
schedule[, except when the warning provision of subsection (h) of this section 
applies]. When there is a second occurrence of the same condition or element of 
a condition, the penalty shown in the second column applies. When there is then 
a third or subsequent occurrence of the same condition or element of a 
condition, the penalty shown in the third column applies. This progression 
applies to facilities regardless of change of ownership or license renewals<nl>. 
<ol>[, except that under change of ownership the facility starts over with the 
progression for other than A; B1, 2, 3, 4; C; D; E1, 2, 4; F1, 4; G1; I1, 2; J1; 
L1; M1, 2, 7, 8; P1, 2e, 5a, 6a, 6b, 7a, 7b, 8a, 10a, 11a, 12a, 13a; Q, R; S1; 
and T. However, when] <nl>When<ol> a facility for two years has not had an 
occurrence of a certain condition or element, the facility's next occurrence of 
that condition or element is in the first column of the schedule. The two-year 
period is measured based on the last day of each visit. A suspension of a 
license and subsequent reinstatement does not interrupt the progression. 
<nl>Since penalties are assessed against the licensed facility, in a change of 
ownership, renewal or reissuance of license all outstanding administrative 
penalties which have been finally assessed must be paid in full prior to 
granting such change of ownership, renewal of reissuance of license.<ol> [A 
voluntary surrendering of a license or a revocation by the department of a 
license interrupts the progression, so that should such a facility come back 
into licensed status, the facility starts over with the progression.] Each 
occurrence under condition T carries a penalty as shown regardless of number of 
occurrences or time between occurrences.
[(j) A facility becomes subject for the first time to penalty criteria on the 
first on-site visit made to the facility that is completed (has its last (day) 
after 60 days following the effective date of these sections, or on an 
occurrence of failure to report abuse or neglect as noted in subsection (g) of 
this section if that occurs before the first on-site visit.
[(k) A condition or element of a condition calling for administrative penalty 
may cause or contribute to causing a facility to receive other disciplinary 
actions.
[(1) An administrative penalty for such condition or element will be waived for:
[(A) any civil penalty imposed under the Health and Safety Code, Chapter 242, 
Subchapter C;
[(B) any trustee appointment under the Health and Safety Code, Chapter 242, 
Subchapter D;
[(C) any immediate closure ordered under the Health and Safety Code, Chapter 
242, Subchapter C; or
[(D) any penalties received under the Health and Safety Code, Chapter 242, 
Subchapter E, for failure to report a case of abuse or neglect.
[(2)  The occurrence of a condition or any element of a condition, however, will 
not be waived.]
<nl>(j)<ol>[(l)] The total recommended penalty on a facility on any visit is the 
aggregate of all applicable penalties shown in the schedule, [or as modified 
under subsections (h), (k), or (p) of this section when applicable].
<nl>(k)<ol>[(m)] The intent in designing the conditions and elements listed in 
the schedule is not to cause an event or finding to be subject to more than one 
condition; where such may occur or seem to occur, the condition or element which 
most closely corresponds with the [deficiency/]violation will apply.
<nl>(l)<ol>[(n)] A follow-up or call-back visit made to determine if a  
<nl>violation<ol> [deficiency] has been corrected is a separate or new visit and 
is not a part of the original visit which occasioned the need of a call-back; 
therefore, if the same violation [deficiency] is found on the call-back visit, 
it is subject to the penalty amount column of the schedule that is appropriate 
for the next time occurrence. A visit made for purpose not included in the 
previous visit, regardless of time interval from the previous visit, is a 
separate or new visit.
<nl>(m) <ol>[(o)] When department staff participating in the visit determine 
that a [deficiency/] violation <nl>may be<ol> [is] subject to administrative 
penalty, those department staff  <nl>may<ol> [should] verbally so advise the 
facility at the exit conference of the conditions or elements of conditions 
involved and that a recommendation for administrative penalty is being made to 
the central office. Department staff will transmit this information and 
recommendation, with all supporting information to the central office. Any 
rebuttal the facility may wish to make must be in writing to the director of the 
Licensing and Certification Services Division, Bureau of Long-Term Care. <nl>If 
verbal notice is not given at the exit conference, the facility must furnish<ol> 
[Such information must be furnished] <nl>any rebuttal information <ol> within 10 
working days from the date verbal notice was given to the facility.
(1)  All incoming reports with recommendation for administrative penalties will 
be reviewed by central office staff and will be referred to the director, 
<nl>Licensing and Certification Services Division <ol> [Quality Standards 
Division].
(2) The director, <nl>Licensing and Certification Services Division <ol> 
[Quality Standards Division], will present the reports and recommendations to 
the review panel specified in sec.145.84(b)(4)(B) of this title (relating to 
Determinations and Actions Pursuant to Inspections, Surveys, and Visits) for 
review. If the review panel <nl>examines the possible violation and the facts 
surrounding the possible violation and concludes<ol> [recommends] that an 
administrative penalty must be assessed and then determines the recommended 
amount, the recommended assessments will be made by or through the chief, Bureau 
of Long-Term Care, in accordance with the applicable parts of the schedule and 
as described in this section [including subsections (h), (k), and (p) of this 
section, when those subsections are applicable]. <nl>After the review panel 
concludes that a violation has occurred a preliminary report will be issued and 
the<ol> [The] facility will be notified of the recommended penalty in accordance 
with <nl>Health and Safety Code, Chapter 242 sec.242.067 <ol> [Texas Civil 
Statutes, Article 4442c, sec.12A(c)].
<nl>(n)<ol>[(p)]  Within 20 days after the date on which written notice of 
recommended assessment is sent to a facility, the facility may <nl>give the 
department written consent to the penalty or make a written request for a 
hearing<ol> [, in lieu of contesting a penalty assessment, transmit 50% of the 
amount for each condition or element of a condition involved in the assessment, 
which shall constitute full payment. This provision, however, does not apply to 
conditions and elements of the schedule identified as A, B (including all 
elements), C, D, I, (including all elements), R (including all elements), S1, T 
(including all elements)].
<nl>(o)<ol>[(q)] The procedures for notification of recommended assessment, 
opportunity for hearing, actual assessment, payment of penalty, judicial review, 
and remittance will be in accordance with <nl>Chapter 242, Health and Safety 
Code, sec.sec.242.066-242.069<ol> [Texas Civil Statutes, Article 4442c, sec.12A] 
and the rules of the Board of Health in sec.sec.1.21-1.33 if this title 
(relating to Formal Hearing Procedures).
<nl>(p)<ol>[(r)]  Conditions and assessments for [deficiencies/] violations 
warranting administrative penalties for nursing homes are described in the 
schedule that follows. [The conditions and the subconditions or elements in the 
schedule primarily relate to existing standards in, has determined that for the 
first five-year period the sections are in effect there will be no fiscal 
implications for state or local government as a result of enforcing or 
administering the sections.has determined that for the first five-year period 
the sections are in effect there will be no fiscal implications for state or 
local government as a result of enforcing or administering the sections  
ssec.145.11-145.25 of this title (relating to Minimum Licensing Standards for 
Nursing Homes). Some conditions or elements relate to other rules or standards 
of this title which apply to nursing homes, such as sec.sec.145.251-145.263 of 
this title (relating to Medication Aides, and some conditions or elements relate 
directly to Health and Safety Code, Chapter 242, or other laws. All conditions 
or elements which relate to such existing standards or directly to Health and 
Safety Code, Chapter 242, or other laws have the appropriate section, 
subsection, or citation referenced. The standards are of Title 25 of the Texas 
Administrative Code.]
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This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on November 4, 1991.
TRD-9113767
Robert A. MacLean, M.D.
Deputy Commissioner
Texas Department of Health
Proposed date of adoption: February 22, 1992
For further information, please call: (512) 458-7709
       
TITLE 28. INSURANCE
Part I. Texas Department of Insurance
Chapter 15. Surplus Lines Insurance
Subchapter A. General Regulation of Surplus Lines Insurance
28 TAC sec.15.3
The State Board of Insurance proposes an amendment to sec.15.3, concerning 
licensing of surplus lines agents. The proposed amendment to this section are 
necessary to avoid duplication or conflict with the board's rules. The proposed 
amendment removes the specific dollar amounts now contained in the sections. 
This is part of a larger proposal to consolidate fee provisions in 28 TAC  s19. 
801 and sec.19.802, to provide staggered renewal dates to conform to uniform 
license renewal requirements, and to set new fees to defray administrative 
costs.
Jack Evins, deputy commissioner for licensing, has determined that for the first 
five-year period the proposed section will be in effect there will be no fiscal 
implications for state government as a result of enforcing or administering the 
section. As a result of the larger proposal, there will be an estimated increase 
in revenue to state government of approximately $4,700,000 per year. This 
increase is needed to defray administrative costs of processing original 
applications, renewals, and appointments, and of enforcing the statutes and 
rules regarding the affected licenses. The cost of compliance for a small 
business will be the amount of the increase in fees. There is no expected 
difference in the cost of compliance between large businesses and small 
businesses on a cost-per-employee basis. There will be no fiscal implications 
for local government. There will be no effect on local employment or local 
economy.
Jack Evins, deputy commissioner for license group, also has determined that, for 
each year of the first five years the section is 4 in effect, with respect to 
the larger proposal, the public benefit anticipated as a result of enforcing the 
section will be recovery by state government of administrative costs, increased 
efficiency in renewing multiple licenses, and consolidation of regulations 
concerning licensing fees. Other than cost of increased fees for applicants and 
licensees, there is no anticipated economic cost to persons who are required to 
comply with the proposed section.
Comments on the proposed section may be submitted to Jack Evins, deputy 
Commissioner for License Group, Texas Department of Insurance, Mail Code 105-5A, 
333 Guadalupe, P.O. Box 149104, Austin, Texas 78714-9104.
This section is proposed under the Insurance Code, Article 1.04, which 
authorizes the State Board of Insurance to issue rules in accordance with the 
laws of this state, and Article 1.14-2, sec.3A, which provides that the State 
Board of Insurance may promulgate rules to enforce Article 1.14-2.
sec.15.3. Licensing of Surplus Lines Agents.
(a) Application procedure for issuance of surplus agent's license. Before any 
surplus lines agent's license shall be issued and before each renewal thereof, 
the following requirements must be completed by an applicant seeking a surplus 
lines license.
(1) (No change.)
(2) <nl>The<ol> [A] fee <nl>specified by  s19.802 of this title (relating to 
Amounts of Fees)<ol> [of $25] shall be submitted for each license in check or 
money order made payable to the State Board of Insurance. No diminution of the 
license fee shall occur as to any license effective after January 1 of any year.
(3) (No change.)
(b) Renewal of license. Every surplus lines license issued to an agent shall be 
valid for a term expiring <nl>two years after<ol> [on the 31st day of December 
next following] the date of issuance unless an original application to qualify 
for the renewal of any such license shall be filed prior to expiration date with 
the commissioner together with <nl>the<ol> [a] fee [of $25] and evidence of 
financial solvency for the renewal term of the license in accordance with 
sec.15.4 of this title (relating to Proof of Agent's Financial Solvency).
(c) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on November 1, 1991.
TRD-9113726
Linda K. von Quintus-Dorn
Chief Clerk
State Board of Insurance
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-6328
       
Chapter 19. Agents Licensing
Subchapter I. Licensing Fees
28 TAC sec.sec.19.202, 19.302, 19.601, 19.706, 19.1311
The State Board of Insurance proposes amendments to sec. s19.202, 19.302, 19. 
601, 19.706, and 19.1311, concerning licensing fees. The proposed amendments to 
these sections are necessary to avoid duplication or conflict within the board's 
rules. The proposed amendments remove the specific dollar amounts now contained 
in the sections. This is part of a larger proposal to consolidate fee provisions 
in 28 TAC sec.19.801 and sec.19.802, and to set new fees to defray 
administrative costs.
Jack Evins, deputy commissioner for license group, has determined that, for each 
year of the first five years the proposed sections will be in effect, there will 
be fiscal implications for state government and small businesses as a result of 
enforcing or administering the sections. As a result of the larger proposal, 
there will be an estimated increase in revenue to state government of 
approximately $4,700,000 per year. This increase is needed to defray 
administrative costs of processing original applications, renewals, and 
appointments, and of enforcing the statutes and rules regarding the affected 
licenses. The cost of compliance for a small business will be the amount of the 
increase in fees. There is no expected difference in the cost of compliance 
between large businesses and small businesses on a cost-per-employee basis. 
There will be no fiscal implications for local government. There will be no 
effect on local employment or local economy.
Jack Evins, deputy commissioner for license group, also has determined that, for 
each year of the first five years the sections will be in effect, as a result of 
the larger proposal, the public benefit anticipated as a result of enforcing the 
sections will be recovery by state government of administrative costs, increased 
efficiency in renewing multiple licenses, and consolidation of regulations 
concerning licensing fees. Other than costs of increased fees for applicants and 
licensees, there is no anticipated economic cost to persons who are required to 
comply with the proposed sections.
Comments on the proposed sections may be submitted to Jack Evins, Deputy 
Commissioner for License Group, Texas Department of Insurance, Mail Code 105-5A, 
333 Guadalupe, P.O. Box 149104, Austin, Texas 78714-9104.
The amendments are proposed under the Insurance Code, Article 1.04, which 
authorizes the State Board of Insurance to issue rules in accordance with the 
laws of this state, and under the following articles of the Insurance Code, 
which authorize the board to determine the amount of fees for various types of 
licenses, namely: Article 3.75, sec.7 (variable contract agent); Article 21.07 
(Group II insurance agent); Article 21.07-1 (Group I legal reserve life 
insurance agent); Article 21.07-4 (insurance adjuster); and Article 21.14-1 
(risk manager).
sec.19.202. Fees for Examination.
(a) Any person wishing to take the examination required for licensure of 
individuals desiring to write such insurance must submit <nl>the<ol> [a $10] 
examination fee <nl>specified by sec.19.802 of this title (relating to Amounts 
of Fees)<ol> with the application in advance of taking the examination.
(b)-(c) (No change.)
sec.19.302. Fees for Examination.
(a) Any person wishing to take the examination required for licensure of 
individuals desiring to write accident and health insurance must submit 
<nl>the<ol> [a $10] examination fee  <nl>specified by sec.19.802 of this title 
(relating to Amounts of Fees)<ol> with the application in advance of taking the 
examination.
(b)-(c) (No change.)
sec.19.601. Fees for Examination. Any person wishing to take the examination for 
an insurance adjuster's license must submit <nl>the <ol> [a $25] examination fee 
<nl>specified by  s19.802 of this title (relating to Amounts of Fees)<ol> with 
the application in advance of taking the examination. The fee shall not be 
refunded to any applicant who may for any reason fail to take such examination 
or to any applicant who may fail to pass the examination.
sec.19.706. Expiration and Renewal of Licenses.
(a) (No change.)
(b) Upon the filing of a request for renewal license, and payment of <nl>the<ol> 
[a] renewal fee <nl>specified by sec.19.802 of this title (relating to Amounts 
of Fees)<ol> [of $25], on or before the date of expiration, the current license 
shall continue in force until the renewal license is issued by the commissioner 
or until the commissioner has refused, for cause, to issue such renewal license 
as provided in the Insurance Code, Article 3.75, sec.19.709 of this title 
(relating to Denial, Suspension, or Revocation of License), or other applicable 
law, and has given notice of such refusal in writing to the agent.
sec.19.1311. Examination and License Fees and Charges.
(a) The commissioner shall collect in advance the following nonrefundable fees 
and charges <nl>specified by sec.19.802 of this title (relating to Amounts of 
Fees)<ol>:
(1) risk manager's license fee [-$50];
(2) examination fee [-$50];
(3) renewal fee [-$50];
(4) late renewal charge [-$50].
(a)-(d) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on November 1, 1991.
TRD-9113725
Linda K. von Quintus-Dorn
Chief Clerk
Texas Department of Insurance
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-6328
       
28 TAC sec.19.801, sec.19.802
The State Board of Insurance proposes new sec.19.801 and sec.19.802, concerning 
procedures and requirements relating to licensing fees for various insurance 
agents, title agents, escrow officers, title attorneys and direct operations; 
insurance adjusters, life insurance counselors, risk managers, health 
maintenance organization agents, prepaid legal services agents and reinsurance 
intermediaries. The proposed sections are necessary to defray administrative 
costs by establishing new fees for original applications, renewals, and 
appointments and to provide readily accessible information regarding fees for 
various types of licenses. The sections also would increase efficiency by 
simplifying the renewal of multiple licenses held by one licensee. Multiple 
licenses would be renewed at the same time. Among other matters, sec.19. 801 
would set forth general provisions allowing for the setting of expiration dates 
for multiple licenses, defining a completed application and providing 
instructions for the submission of fees, and sec.19.802 would specify the fees 
for each type of license.
Jack Evins, deputy commissioner for license group, has determined that, for each 
year of the first five years the proposed sections will be in effect, there will 
be fiscal implications for state government as a result of enforcing or 
administering the sections. There will be an estimated increase in revenue to 
state government of approximately $4,770,000 per year. This increase is needed 
to defray administrative costs of processing original applications, renewals, 
and appointments, and of enforcing the statutes and rules regarding the affected 
licenses. The cost of compliance for a small business will be the amount of the 
increase in fees. There is no expected difference in the cost of compliance 
between large businesses and small businesses on a cost-per-employee basis. 
There will be no fiscal implications for local government. There will be no 
effect on local employment or local economy.
Jack Evins, deputy commissioner for license group, also has determined that, for 
each year of the first five years the sections will be in effect, the public 
benefit anticipated as a result of enforcing the sections will be recovery by 
state government of administrative costs, increased efficiency in renewing 
multiple licenses, and consolidation of regulations concerning licensing fees. 
Other than costs of increased fees for applicants and licensees, there is no 
anticipated economic cost to persons who are required to comply with the 
proposed sections.
Comments on the proposed sections may be submitted to Jack Evins, Deputy 
Commissioner for License Group, Texas Department of Insurance, Mail Code 105-5A, 
333 Guadalupe, P.O. Box 149104, Austin, Texas 78714-9104.
The new sections are proposed under the Insurance Code, Article 1.04, which 
authorizes the State Board of Insurance to issue rules in accordance with the 
laws of this state, and under the following articles of the Insurance Code, 
which authorize the board to determine the amount of fees for various types of 
licenses, namely: Article 1.14-2, sec.4 (surplus lines agent); Article 3.75, 
sec.7 (variable contract agent); Article 9.36 (title insurance agent); Articles 
9.42-9. 43 (title escrow officer); Article 9.56, sec.6 (title attorney); Article 
9.36A (direct operation); Article 20A.15 (health maintenance organization 
agent); Article 20A.15A (health maintenance organization agent for single health 
care service plans); Article 21.07 (Group II insurance agent); Article 21.07-1 
(Group I legal reserve life insurance agent); Article 21.07-2 (life insurance 
counselor) ; Article 21.07-3 (managing general agent); Article 21.07-4 
(insurance adjuster); Article 21.11 (non-resident property and casualty agent); 
Article 21.14 (local recording agent and solicitor); Article 21.14-1 (risk 
manager); Article 21.14-2 (agricultural agent); Article 23.23 (prepaid legal 
services agent); and Article 21.07-7 (reinsurance intermediary).
sec.19.801. General Provisions Regarding Licensing Fees and License Renewal.
(a) Original application. The applicant shall submit the required original 
application fee at the time of filing an application for license. The original 
application fee is fully earned at the time of application, and shall not be 
reduced for any reason.
(b) Renewal of license.
(1) A "completed application" is one that provides every piece of information 
required of the licensee by the application form.
(2) An applicant for renewal of a license which has neither expired nor been 
suspended or revoked shall submit the required renewal fee and completed 
application for renewal.
(3) The commissioner's staff may designate one expiration date per licensee, to 
apply to all licenses held by that licensee. The designated date shall be the 
date on which one license would normally expire. For licenses which normally 
would expire after the newly-designated expiration date, renewal fees shall be 
reduced pro rata on a monthly basis. The fee reduction shall be for the renewal 
immediately following the institution of the designated expiration date. On each 
subsequent renewal, the licensee shall pay the full renewal fee for each 
license.
(c) Appointment. The fee for appointment of a currently licensed solicitor, or 
for appointment of an agent to represent additional insurers, health maintenance 
organizations, or non-profit legal services corporations, shall accompany the 
notice of appointment.
(d)  Submissions of fees. All fees shall be submitted in check or money order 
made payable to the Texas Department of Insurance, except for applicants who 
must qualify by examination, where the application is to be submitted to a 
national testing service, as provided under the Insurance Code, Article 21.01-1.
sec.19.802. Amounts of Fees.
(a) With each application for original license or renewal, notice of 
appointment, or request for qualifying examination, the applicant or licensee 
shall submit the amount shown in this section. The fees for qualifying 
examinations and re-examinations only apply if the Texas Department of Insurance 
does not contract with a testing service for the provisions of these 
examinations.
(b) The amounts of fees are as follows.
(1) Group I, legal reserve life insurance agent:
(A)  original application $50;
(B) renewal $48;
(C) additional appointment $10;
(D) qualifying examination $20;
(E) in addition to the original application fee listed in subparagraph (A) 
above, an application filing fee for a temporary license, of $100.
(2) Group II insurance agent:
(A) original application $50;
(B) renewal $48;
(C)  additional appointment $10;
(D) qualifying examination $20;
(E) in addition to the original application fee listed in subparagraph (A) 
above, an application filing fee for a temporary license, of $100.
(3) Health maintenance organization agent (basic health care plan):
(A) original application $50;
(B) renewal $48;
(C)  additional appointment $10;
(D) qualifying examination $20.
(4) Health maintenance organization agent (single health care service plan):
(A) original application $50;
(B) renewal $48;
(C)  additional appointment $10.
(5) Insurance adjuster:
(A) original application $50;
(B) renewal $48;
(C)  qualifying examination $50.
(6) Insurance adjuster (emergency license): original application $20.
(7) Local recording agent:
(A) original application $50;
(B) renewal $48;
(C) additional appointment $16;
(D)  qualifying examination $50.
(8) Solicitor:
(A) original application $20;
(B) renewal $18;
(C)  qualifying re-examination $20;
(D) appointment of currently licensed solicitor $10.
(9) Managing general agent:
(A) original application $30;
(B) renewal $48;
(C)  additional appointment $10.
(10) Prepaid legal:
(A) original application $50;
(B) renewal $48;
(C)  additional appointment $10;
(D) qualifying examination $20.
(11) Surplus lines agent:
(A) original application $50;
(B) renewal $48;
(C) qualifying examination $20.
(12) Title insurance agent:
(A) original application $50;
(B) renewal $48.
(13) Title insurance escrow officer:
(A) original application $50;
(B) renewal $48.
(14) Title attorney:
(A) original application $50;
(B) renewal $48.
(15) Direct operation license:
(A) original application $50;
(B) renewal $48.
(16) Variable contract agent:
(A) original application $50;
(B) renewal $48;
(C) additional appointment $10.
(17) Risk manager:
(A) original application $50;
(B) renewal $48;
(C) qualifying examination $50.
(18) Agricultural agent:
(A) original application $50;
(B) renewal $50.
(19) Life insurance counselor:
(A) original application $50;
(B) renewal $48;
(C) qualifying examination $20.
(20) Nonresident property and casualty agent:
(A) original application $50;
(B) renewal $48.
(21) Reinsurance intermediary:
(A) original application $4616;
(B) renewal $4616.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on November 1, 1991.
TRD-9113724
Linda K. von Quintus-Dorn
Chief Clerk
Texas Department of Insurance
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-6328
       
TITLE 34. PUBLIC FINANCE
Part I. Comptroller of Public Accounts
Chapter 3. Tax Administration
Subchapter J. Petroleum Products Delivery Fee
34 TAC sec.3.152
The Comptroller of Public Accounts proposes new sec.3.152, concerning imposition 
and collection of the Texas Petroleum Products Delivery Fee. The new section 
explains the standards for determining when the fee applies and the amount to be 
collected.
The new section implements legislation which became effective September 1, 1989, 
and provides guidance to persons required to pay or collect the fee.
Tom Plaut, chief revenue estimator, has determined that for the first five-year 
period the proposed section will be in effect there will be no significant 
revenue impact on the state or local government as a result of enforcing or 
administering the section. The section is adopted under the Tax Code, Title 2, 
and does not require a statement of fiscal implications for small businesses.
Dr. Plaut also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be in providing new information regarding tax responsibilities. 
There is no anticipated economic cost to persons who are required to comply with 
the proposed section.
Comments on the new section may be submitted to Lucy Glover, Manager, Tax 
Administration Division, P.O. Box 13528, Austin, Texas 78711.
The new section is proposed under the Tax Code, sec.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 the Tax Code, Title 
2.
sec.3.152. Imposition and Collection of the Fee.
(a) The Texas Petroleum Products Delivery Fee is imposed, collected, and paid to 
the state by operators of bulk facilities. The fee is assessed when petroleum 
products are withdrawn from the bulk facility and delivered into a cargo tank or 
barge or imported into this state in a cargo tank or barge for delivery to 
another location for distribution or sale. The fee is not assessed when the fuel 
is destined for delivery to another bulk facility, an electrical generating 
plant, a common carrier railroad for its exclusive use, or is to be exported 
from the state.
(b) For the purposes of this section, withdrawals from a bulk facility into a 
cargo tank or barge are not subject to the fee when the entire withdrawal is 
delivered into the fuel supply tanks of vessels or boats.
(c)  The fee is collected by the operator of a bulk facility from the person 
ordering the withdrawal. The fee is computed as follows:
(1) $12.50 for each delivery into a cargo tank or barge having a capacity of 
less than 2,500 gallons;
(2) $25 for each delivery into a cargo tank or barge having a capacity of 2,500 
gallons or more but less than 5,000 gallons;
(3) $37. 50 for each delivery into a cargo tank or barge having a capacity of 
5,000 gallons or more but less than 8,000 gallons;
(4) $50 for each delivery into a cargo tank or barge having a capacity of 8,000 
gallons or more but less than 10,000 gallons; and
(5) a $25 fee for each increment of 5,000 gallons or any part thereof delivered 
into a cargo tank or barge having a capacity of 10,000 gallons or more.
(d) In determining the amount of fee due for motor gasoline, other alcohol 
blended fuels, and aviation gasoline, each net temperature corrected withdrawal 
of 7,000 gallons or more but less than 10,000 gallons shall be presumed to have 
been a delivery into a cargo tank having a capacity of 8,000 gallons or more but 
less than 10,000 gallons and the fee shall be collected as provided by 
subsection (c)(4) of this section.
(e) In determining the amount of fee due on all withdrawals not covered by 
subsection (d) of this section, it shall be presumed that the capacity of the 
cargo tank or barge is equal to the total net temperature corrected quantity of 
product withdrawn.
(f) For the purposes of this section, a bulk facility is a refinery terminal or 
any other terminal or facility which receives petroleum products by pipeline, 
rail, or barge, and delivers the products into a cargo tank or barge.
(g) For the purposes of this section, the operator of a bulk facility is the 
person who first invoices petroleum products withdrawn from the facility. An 
exchange statement is not considered an invoice.
(h)  For the purposes of this section, an electrical generating facility is a 
plant operated for the primary purpose of generating electricity for sale to 
consumers.
(i) Persons exempt from the petroleum products delivery fee, including persons 
operating barges who make withdrawals from bulk for delivery into the fuel 
supply tanks of vessels or boats, shall request in writing a letter of exemption 
from the comptroller. The letter of exemption issued by the comptroller, or a 
copy, must be furnished to the seller each time purchases exempt from the 
petroleum product delivery fee are made.
(j) If the person making the sale to the exempt purchaser does not hold a 
petroleum products delivery fee permit, the purchaser must also furnish to the 
seller a statement listing the date of purchase, number of gallons purchased per 
delivery, and destination of the product. For the seller to receive credit for 
exempt sales, this documentation must be presented to the permitted bulk 
facility from which the product was purchased.
(k) The amount of the petroleum products delivery fee must be listed as a 
separate item on the invoice or cargo manifest issued by persons holding a 
permit to collect the fee upon the withdrawal of product from a bulk facility.
(l) Only persons who hold a petroleum products delivery fee permit may charge 
and collect the fee on the basis of the bracket system established in this 
section. No other person selling fuel may list the fee as a separate item on 
invoices or manifests except:
(1)  when required to do so by another governmental agency; or
(2) when an amount is clearly identified as reimbursement. An amount collected 
as reimbursement may not exceed the amount of fee actually paid by the person 
issuing the manifest or invoice.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 30, 1991.
TRD-9113451
Martin Cherry
Chief, General Law Section
Comptroller of Public Accounts
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-4028
       
Subchapter L. Motor Fuels Tax
34 TAC sec.3.193
The Comptroller of Public Accounts proposes an amendment to sec.3.193, 
concerning the documentation required to be submitted with a report or refund 
claim when bad debt is taken as a credit or a refund is requested. Bad debt may 
be taken as a credit by a distributor or supplier on his monthly report or a 
refund may be requested.
Tom Plaut, chief revenue estimator, has determined that for the first five-year 
period the proposed section will be in effect there will be no significant 
revenue impact on the state or local government as a result of enforcing or 
administering the section. This section is adopted under the Tax Code, Title 2, 
and does not require a statement of fiscal implications for small businesses.
Dr. Plaut also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be in providing new information regarding tax responsibilities. 
There is no anticipated economic cost to persons who are required to comply with 
the proposed section.
Comments on the proposal may be submitted to Lucy Glover, Manager, Tax 
Administration Division, P.O. Box 13528, Austin, Texas 78711.
The amendment is proposed under the Tax Code, sec.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 the Tax Code, Title 
2.
sec.3.193. Bad Debt Deductions.
(a) Bad debt refund or credit.
(1) A permitted gasoline distributor or diesel fuel supplier may take credit 
against taxes to be remitted to the comptroller or claim a refund on taxes paid 
to the comptroller for bad debt on sales [made on or after August 1, 1984].
(2) To establish bad debt credit or refund, a distributor's or supplier's 
records must show:
(A) date of sale(s);
(B) name and address of purchaser;
(C) invoices reflecting the tax was assessed;
(D) taxes [were] paid by the distributor or supplier;
(E) all payments or credits [were] applied to the account of the purchaser;
(F) uncollected amounts [have been] designated as a bad debt in the 
distributor's or supplier's records.
(3) To determine the amount of bad debt allowance for tax, all payments or 
credits in reduction of a customer's account must be applied ratably between 
motor fuel and other goods sold to that customer, and the credit allowed will be 
the tax on the number of gallons represented by the motor fuel portion of the 
bad debt.
<nl>(4) The following information must be submitted with the distributor's or 
supplier's report or refund claim form on which the credit is claimed:
<nl>(A) name and address of the purchaser;
<nl>(B) Texas taxpayer number or federal identification number or social 
security number, if available;
<nl>(C) beginning and ending dates of sales on which the bad debt is being 
taken;
<nl>(D) number of gallons and dollar amount of bad debt; and
<nl>(E) the fuel type (gasoline or diesel fuel).
(1) A credit card is defined as any card, plate, key, or like device by which 
credit is extended to and charged to the purchaser's account.
(2) Sales of fuel into the supply tank of a motor vehicle or motorboat when 
payment is made through the use and acceptance of a credit card may not be taken 
as a bad credit or refund.
(3) All credit sales to commercial or agricultural customers at locations not 
open to the general public are subject to the bad debt credit or refund.
(c) Penalty and interest.
(1) If an account is collected which has been written off as a bad debt, 
interest will accrue from the date the credit was taken or refund granted.
(2) Penalty will [not] be imposed <nl>if <ol> [unless] the recovered bad debt is 
not reported and tax <nl>is not <ol> paid to the state during the reporting 
period in which the recovery is made or <nl>if <ol> [it is determined by] the 
comptroller <nl>determines <ol> that the taxpayer knew or should reasonably have 
known that the debt was collectible at the time the credit was taken.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 30, 1991.
TRD-9113449
Martin Cherry
Chief, General Law Section
Comptroller of Public Accounts
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-4028
       
Subchapter O. State Sales and Use Tax
34 TAC sec.3.310
The Comptroller of Public Accounts proposes an amendment to sec.3.310, 
concerning laundry, cleaning, and garment services. The amendment is the result 
of the repeal by the 72nd Legislature, 1991, First Called Session, of the sales 
tax exemption in the Tax Code, sec.151.321, for wrapping and packaging 
materials. This change in the Tax Code is effective October 1, 1991.
Tom Plaut, chief revenue estimator, has determined that for the first five-year 
period the proposed section will be in effect there will be no significant 
revenue impact on the state or local government as a result of enforcing or 
administering the section. The section is adopted under the Tax Code, Title 2, 
and does not require a statement of fiscal implications for small businesses.
Dr. Plaut also has determined that for each year of the first five years the 
section is in effect there would be no significant public cost or benefit. There 
is no anticipated economic cost to persons who are required to comply with the 
proposed section.
Comments on the proposal may be submitted to Lucy Glover, Manager, Tax 
Administration Division, P.O. Box 13528, Austin, Texas 78711.
The amendment is proposed under the Tax Code, sec.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 the Tax Code, Title 
2.
sec.3.310. Laundry, Cleaning, and Garment Services.
(a)  Personal services means all services listed under Group 721, Major Group 72 
of the Standard Industrial Classification Manual, 1972. Personal services listed 
in Group 721 are laundry, cleaning, and garment services.
(b) Sales tax is due on laundry, cleaning, and garment service. Examples 
include, but are not limited to:
(1) carpet cleaning and repairing, except carpet repairing performed in 
residential structures;
(2) diaper cleaning service;
(3) drapery cleaning services;
(4) dry cleaning services for garments or rugs;
(5) fur garment cleaning, repairing, and storage;
(6) garment alterations and repairs;
(7) ironing or pressing garment services;
(8) mending services;
(9) power and hand laundry services;
(10) rug cleaning, dying, and repairing services;
(11) tailoring garments;
(12) treating or applying protective chemicals to carpet, upholstery, rugs, or 
drapery;
(13) upholstery cleaning and repairs;
(14) uniform or linen cleaning services that provide only the services to clean 
or launder the customers' uniforms or linens; and
(15) valet services.
(c) Sales tax is due on cleaning supplies (chemicals, soaps, etc.), machinery, 
tools, utilities, and equipment used to perform laundry, cleaning, and garment 
services.
(d)<nl> With the exception of wrapping and packaging supplies, sales<ol> [Sales] 
tax is not due on items that are transferred to the customers as an integral 
part of the laundry, cleaning, and garment personal services. <nl>For 
example<ol> [Examples include clothes hangers, plastic bags, or paper used to 
wrap cleaned garments], buttons[,] and thread used in mending or tailoring. 
Examples of items transferred in residential carpet, drapery, or upholstery 
cleaning include: carpet protectors, fire retardants, antistatic applications, 
flea killers, and rust inhibitors. See sec.3.285 of this title (relating to 
Resale Certificate; Sales for Resale). <nl>Sales tax is due on the purchase of 
wrapping and packaging supplies used to provide taxable services.
(e) Sales tax is not due on personal services provided through coin- operated 
machines that are operated by the customer.
(f) Sales tax is not due on personal services if performed by an employee for 
his employer as part of employee's regular duties for which he is paid. Sales 
tax is due on personal services that are performed on a contractual basis 
between two or more parties.
(g) Sales tax is not due on repairs to carpet in residential real property. See 
sec.3.291 of this title (relating to Contractors).
(h) Effective January 1, 1989, sales tax is not due on the labor to clean, 
restore, or repair tangible personal property when damaged along with real 
property by fire, flood, explosion, natural disasters, or other accident for 
which a casualty claim could have been filed if the property was insured. The 
person having the property repaired under this subsection should issue the 
service provider an exemption certificate in lieu of tax on the labor. The 
service provider's presumption is that all work is taxable unless an exemption 
certificate is issued. The service provider must collect sales tax on all 
materials transferred to the customer in the performance of the repair service.
(i) Records must be kept on all personal services performed. Sales tax is due on 
the total receipts if adequate records are not maintained. See sec.3. 281 of 
this title (relating to Records Required; Information Required).
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 30, 1991.
TRD-9113457
Martin Cherry
Chief, General Law Section
Comptroller of Public Accounts
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-4028
       
34 TAC sec.3.314
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Comptroller of 
Public Accounts or in the Texas Register office, Room 245, James Earl Rudder 
Building, 1019 Brazos Street, Austin.)
The Comptroller of Public Accounts proposes the repeal of sec.3.314, concerning 
wrapping, packing, packaging supplies, containers, labels, tags, and export 
packers. This section is being repealed in order that a substantially revised 
section dealing with the same subject matter may be adopted.
Tom Plaut, chief revenue estimator, has determined that for the first five-year 
period the repeal is in effect there will be no significant revenue impact on 
state or local government as a result of enforcing or administering the repeal. 
This repeal is promulgated under the Tax Code, Title 2, and does not require a 
statement of fiscal implications for small businesses.
Dr. Plaut also has determined that for each year of the first five years the 
repeal is in effect there would be no public benefit anticipated as a result of 
enforcing the repeal. There is no anticipated economic cost to persons who are 
required to comply with the repeal as proposed.
Comments on the repeal may be submitted to Lucy Glover, Manager, Tax 
Administration Division, P.O. Box 13528, Austin, Texas 78711.
The repeal is proposed under the Tax Code, sec.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 the Tax Code, Title 
2.
sec.3.314. Wrapping, Packing, Packaging Supplies, Containers, Labels, Tags, and 
Export Packers.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 31, 1991.
TRD-9113570
Martin Cherry
Chief, General Law Section
Comptroller of Public Accounts
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-4028
       
Subchapter P. Municipal Sales and Use Tax
34 TAC sec.3.373
The Comptroller of Public Accounts proposes an amendment to sec.3.373, 
concerning change or alteration of city boundaries. The amendment sets out the 
comptroller's policy when territory in a transit authority is annexed by a city.
Tom Plaut, chief revenue estimator, has determined that for the first five-year 
period the proposed section will be in effect there will be no significant 
revenue impact on the state or local government as a result of enforcing or 
administering the section. The section is adopted under the Tax Code, Title 2, 
and does not require a statement of fiscal implications for small businesses.
Dr. Plaut also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be in providing new information regarding tax responsibilities. 
There is no anticipated economic cost to persons who are required to comply with 
the proposed section.
Comments on the proposal may be submitted to Lucy Glover, Manager, Tax 
Administration Division, P.O. Box 13528, Austin, Texas 78711.
The amendment is proposed under the Tax Code, sec.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 the Tax Code, Title 
2.
sec.3.373. Change or Alteration of City Boundaries.
(a) If any city in which a <nl>city<ol> [local] sales and use tax has been 
imposed <nl>changes or laters<ol> [shall thereafter change or later] its 
boundaries, the city secretary [of such city] shall forward to the comptroller 
by United States registered mail or certified mail a certified copy of the 
ordinance adding or detaching territory from <nl>the<ol> [such] city. 
<nl>The<ol> [Such] ordinance <nl>must<ol> [shall] reflect the effective date 
<nl>of the change <ol> [thereof], and <nl>must <ol> [shall] be accompanied by a 
map of the city clearly showing the territory added [thereof] or detached 
[therefrom].
(b) Upon receipt of <nl>the<ol> [such] ordinance and map, the tax imposed by the 
<nl>Tax Code, Chapter 321, is<ol> [Local Sales and Use Tax Act shall be] 
effective in <nl>the <ol> [such] added territory or abolished in <nl>the <ol> 
[such] detached territory on the first day of the next succeeding quarter. 
<nl>If<ol> [Provided, however, that if] within 10 days after receipt of <nl>the 
<ol> [such] ordinance and map, the comptroller notifies the city secretary in 
writing that more time is required, the comptroller <nl>is<ol> [shall be] 
entitled to delay implementation one whole <nl>calendar <ol> quarter. In this 
event, the effective date of adoption or abolition <nl>is<ol> [shall be] 
determined in the same manner as illustrated in sec.3.372 of this title 
(relating to <nl>Adopting or Abolishing City Tax <ol> [Notice; Adoption or 
Abolition; Contested Case]).
<nl>(c) If a city that is not part of a transit authority annexes territory in a 
transit authority, transit sales and use tax ceases to be effective in the 
annexed area on the date the city tax becomes effective. If the territory is 
subsequently deannexed by the city, no local tax applies in this territory until 
action is taken by a local taxing jurisdiction to impose or reimpose a local 
tax. See  s3.423 of this title (relating to Change or Alteration of Authority 
Boundaries; Withdrawal from Authority; Notification Required).
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 30, 1991.
TRD-9113458
Martin Cherry
Chief, General Law Section
Comptroller of Public Accounts
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-4028
       
34 TAC sec.3.376
The Comptroller of Public Accounts proposes an amendment to sec.3.376, 
concerning prior contract exemptions. The amendment changes the Tax Code 
reference from the Local Sales and Use Tax Act to the Municipal Sales and Use 
Tax Act and adds county sales and use taxes and other local taxes for special 
purposes to the prior contract exemption certificate.
Tom Plaut, chief revenue estimator, has determined that for the first five-year 
period the proposed section will be in effect there will be no significant 
revenue impact on the state or local government as a result of enforcing or 
administering the section. This section is adopted under the Tax Code, Title 2, 
and does not require a statement of fiscal implications for small businesses.
Dr. Plaut also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be in providing new information regarding tax responsibilities. 
There is no anticipated economic cost to persons who are required to comply with 
the proposed section.
Comments on the proposal may be submitted to Lucy Glover, Manager, Tax 
Administration Division, P.O. Box 13528, Austin, Texas 78711.
The amendment is proposed under the Tax Code, sec.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 the Tax Code, Title 
2.
sec.3.376. Prior Contract Exemptions.
(a) Exemption. There are exempted from the taxes imposed by the 
<nl>Municipal<ol> [Local] Sales and Use Tax Act the receipts from the sale, use, 
or rental of, and the storage, use, or other consumption in this state of 
taxable items:
(1) used for the performance of a written contract executed prior to the 
effective date of any <nl>city<ol> [local] sales and use tax; or
(2) used pursuant to the obligation of a bid or bids submitted prior to the 
effective date of any <nl>city <ol> [local] sales and use tax, which bid or bids 
and contract entered into pursuant thereto are at a fixed price not subject to 
change or modification by reason of a tax imposed by any city under the 
<nl>Municipal <ol> [Local] Sales and Use Tax Act.
(b)  Records. Persons claiming the exemption provided in subsection (a)(1) or 
(2) of this section must maintain records which may be verified by audit. 
Failure to maintain adequate records subject to examination by the Comptroller 
of Public Accounts results in an automatic loss of the exemption. Written notice 
of such contracts or bids to the Comptroller of Public Accounts will not be 
required.
(c) Limitations. The <nl>prior contract <ol> exemption provided by <nl>the Tax 
Code, Chapter 321,<ol> [the Local Sales and Use Tax Act,  s6] will have no 
effect on the receipts from the sale, use, or rental of, and the storage, use, 
or other consumption of <nl>taxable items<ol> [tangible personal property] in 
any city after three years has elapsed since the date on which the <nl>city<ol> 
[local] sales and use tax in such city or annexed area became effective.
[(d) Exemption certificate. An identification number is required on the prior 
contract exemption certificates furnished to vendors. The identification number 
should be the person's federal employer's identification (FEI) number or social 
security number if the person has not been assigned an FEI number. A suggested 
form for the exemption certificate is shown below:]
<nl>(d)<ol>[(e)] General information. <nl>The provisions of sec.3.319 of this 
title (relating to Prior Contracts) concerning definitions and exclusions to the 
prior contract exemptions apply to this section.
(1)  Written contracts or bids executed prior to the effective date of 
imposition of a <nl>city<ol> [local] sales and use tax which require a retailer 
to sell tangible personal property or taxable services to a user or consumer at 
a set price, to be delivered on or after the effective date of the city tax will 
be exempt from city tax. See subsection (c) of this section regarding the 
statute of limitations for prior contracts.
(2) Annexation of territory into a city having the  <nl>city<ol> [local] tax in 
effect may be a basis for claiming the prior contract exemption subject to the 
same requirements set forth in this rule.
(3) If a written contract executed prior to the effective date of the 
<nl>city<ol> [local] sales and use tax requires a retailer or lessor to lease or 
rent tangible personal property to another person for use [by him as lessee], 
the retailer or lessor will not be required to collect the <nl>city<ol> [local] 
sales and use tax and the lessee will be exempt from the local sales or use tax 
on the use of said property. Any renewal or exercise of an option to extend the 
time of the lease or rental contract shall be deemed to be a new contract. See 
subsection (c) of this section regarding the statute of limitations for prior 
contracts.
<nl>(e) Prior contract exemption certificate. An identification number is 
required on the prior contract exemption certificates furnished to vendors. The 
identification number should be the person's federal employers identification 
(FEI) number or social security number if the person has not been assigned an 
FEI number. A suggested form for the exemption certificate is shown on the last 
page of this section.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 30, 1991.
TRD-9113455
Martin Cherry
Chief, General Law Section
Comptroller of Public Accounts
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-4028
       
Subchapter Q. Franchise Tax
34 TAC sec.3.401
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Comptroller of 
Public Accounts or in the Texas Register office, Room 245, James Earl Rudder 
Building, 1019 Brazos Street, Austin.)
The Comptroller of Public Accounts proposes the repeal of sec.3.401, concerning 
county assessed value reporting method. The section is being repealed because 
the county assessed value method of computing franchise tax has not been allowed 
by law on any franchise tax report which reflects a corporation's financial 
condition as of January 1, 1980, or later.
Tom Plaut, chief revenue estimator, has determined that for the first five-year 
period the proposed section will be in effect there will be no significant 
revenue impact on the state or local government as a result of enforcing or 
administering the section. This section is adopted under the Tax Code, Title 2, 
and does not require a statement of fiscal implications for small businesses.
Dr. Plaut also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be from the clarification of comptroller rules. There is no 
anticipated economic cost to persons who are required to comply with the 
proposed section.
Comments on the proposed repeal may be submitted to Lucy Glover, Manager, Tax 
Administration Division, P.O. Box 13528, Austin, Texas 78711.
The repeal is proposed under the Tax Code, sec.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 the Tax Code, Title 
2.
sec.3.401. County Assessed Value Reporting Method.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 30, 1991.
TRD-9113453
Martin Cherry
Chief, General Law Section
Comptroller of Public Accounts
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-4028
       
Subchapter R. Transit Sales and Use Tax
34 TAC sec.3.423
The Comptroller of Public Accounts proposes an amendment to sec.3.423, 
concerning change or alteration of authority boundaries; withdrawal from 
authority; notification required. The amendment sets out the comptroller's 
policy when territory in a transit authority is annexed by a city.
Tom Plaut, chief revenue estimator, has determined that for the first five-year 
period the section is in effect there will be no significant revenue impact on 
the state or local government as a result of enforcing or administering the 
section. This section is adopted under the Tax Code, Title 2, and does not 
require a statement of fiscal implications for small businesses.
Dr. Plaut also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be in providing new information regarding tax responsibilities. 
There is no anticipated economic cost to persons who are required to comply with 
the proposed section.
Comments on the proposal may be submitted to Lucy Glover, Manager, Tax 
Administration Division, P.O. Box 13528, Austin, Texas 78711.
The amendment is proposed under the Tax Code, sec.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 the Tax Code, Title 
2.
sec.3.423. Change or alteration of <nl>Transit  [Authority] Boundaries. 
[Withdrawal from Authority; Notification Required]
(a) Alteration of boundaries by authority.
(1) If any [metropolitan] transit authority [(MTA)] in which <nl>transit<ol> [an 
MTA] sales and use tax has been imposed <nl>changes or alters<ol> [shall 
thereafter change or alter] its boundaries, the presiding officer of the board 
of  <nl>the<ol> [such] authority shall forward to the comptroller by United 
States registered mail or certified mail a certified copy of the ordinance 
adding or detaching territory from <nl>the<ol> [such] authority. <nl>The<ol> 
[Such] ordinance <nl>must<ol> [shall] reflect the effective date <nl>of the 
change<ol> [thereof], and <nl>must<ol> [shall] be accompanied by a map of the 
authority clearly showing the territory added [thereto] or detached [therefrom].
(2) Upon receipt of the order and map, the <nl>transit <ol> [MTA] sales and use 
tax <nl>is<ol> [shall be] effective in the added territory on the first day of 
the next succeeding quarter. <nl>If <ol> [However, if] the comptroller notifies 
the presiding officer of the board in writing within 10 days after receipt of 
the order and map that [he requires] more time <nl>is required<ol>, the 
comptroller shall be entitled to delay implementation one whole calendar 
quarter. Thereafter, the tax shall be effective in the added territory <nl>or 
shall cease to be due on<ol> the first day of the next succeeding calendar 
quarter following the elapsed quarter.
(b) <nl>Annexation by a city. If a city that is not part of a transit authority 
annexes territory in a transit authority, transit sales and use tax ceases to be 
effective in the annexed area on the date the city tax becomes effective. If the 
territory is subsequently deannexed by the city, no transit sales and use tax 
applies in this territory until action is taken by the authority as required by 
subsection (a) of this section to add the territory to the authority<ol> 
[Withdrawal from authority by city or town].
[(1) The governing body of an incorporated city or town that is included within 
the territory of an authority and that has a population more than 90% of which 
resides outside the county in which the majority of the population of the 
principal city resides may on any date from April 1, 1980, to September 1, 1980, 
hold an election on the question of whether the city or town shall withdraw from 
the authority. If a majority of the qualified voters in the city or town voting 
on the question votes to withdraw from the authority, the governing body shall 
certify the results of the election to the board of the authority, and the city 
or town shall withdraw from the authority.
[(2) The board shall enter the results on its minutes and adopt an order 
declaring the withdrawal of the city or town. A certified copy of the order 
shall be filed with the State Department of Highways and Public Transportation 
or its successor and the Comptroller of Public Accounts and in the deed records 
of each county in which the authority is located. The order shall reflect the 
date of the election, the proposition voted on, the total number of votes cast 
for and against the proposition in each election unit, the number of votes by 
which the proposition was approved in each election unit and shall be 
accompanied by a map of the authority clearly showing the boundaries of the 
authority.
[(3) Upon actual receipt of the Comptroller of Public Accounts of notification 
of the withdrawal of a city or town, there shall elapse one whole calendar 
quarter prior to the withdrawal becoming effective. Thereafter, the withdrawal 
shall be effective beginning on the first day of the next calendar quarter 
following the elapsed calendar quarter.]
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 30, 1991.
TRD-9113454
Martin Cherry
Chief, General Law Section
Comptroller of Public Accounts
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-4028
       
34 TAC sec.3.426
The Comptroller of Public Accounts proposes an amendment to sec.3.426, 
concerning prior contract exemptions. The amendment changes the Tax Code 
reference from the Metropolitan Transit Authority Act to the Tax Code, Chapter 
322, and adds county sales and use taxes and other local taxes for special 
purposes to the prior contract exemption certificate.
Tom Plaut, chief revenue estimator, has determined that for the first five-year 
period the proposed section will be in effect there will be no significant 
revenue impact on the state or local government as a result of enforcing or 
administering the section. This section is adopted under the Tax Code, Title 2, 
and does not require a statement of fiscal implications for small businesses.
Dr. Plaut also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be in providing new information regarding tax responsibilities. 
There is no anticipated economic cost to persons who are required to comply with 
the proposed section.
Comments on the proposal may be submitted to Lucy Glover, Manager, Tax 
Administration Division, P.O. Box 13528, Austin, Texas 78711.
The amendment is proposed under the Tax Code, sec.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 the Tax Code, Title 
2.
sec.3.426. Prior Contract Exemptions.
(a) Exemption. There are exempted from the taxes imposed by the <nl>Tax Code, 
Chapter 322,<ol> [Metropolitan Transit Authority (MTA) Act] the receipts from 
the sale, use, or rental of and the storage, use, or other consumption in this 
state of taxable items:
(1) used for the performance of written contracts executed prior to the 
effective date of any <nl>transit<ol> [MTA] sales or use tax; or
(2) used pursuant to the obligation of a bid or bids submitted prior to the 
effective date of any <nl>transit <ol> [MTA] sales and use tax, which bid or 
bids and contract entered into pursuant to the bids are at a fixed price not 
subject to change or modification by reason of a tax imposed by any <nl>taxing 
entity<ol> [authority] under the  <nl>Tax Code, Chapter 322 <ol> [Metropolitan 
Transit Authority Act].
(b) Records. Persons claiming the exemption provided in subsection (a)(1) or (2) 
of this section must maintain records which may be verified by audit. Failure to 
maintain adequate records subject to examination by the Comptroller of Public 
Accounts results in an automatic loss of the exemption. Written notice of such 
contracts or bids to the Comptroller of Public Accounts will not be required.
[(c) Exemption certificate. An identification number is required on the 
exemption certificates furnished to vendors. The identification number should be 
the person's federal employer's identification (FEI) number or social security 
number if the person has not been assigned an FEI number. A suggested form for 
the exemption certificate is:]
<nl>(c)<ol>[(d)] Limitations. The <nl>prior contract <ol> exemption provided by 
the <nl>Tax Code, Chapter 322,<ol> [Metropolitan Transit Authority Act] will 
have no effect on the receipts from the sale, use, or rental of, and the 
storage, use, or other consumption of <nl>taxable items<ol> [tangible personal 
property] in any <nl>taxing entity<ol> [authority] three years after the date on 
which the <nl>transit<ol> [MTA] sales and use tax in the <nl>taxing entity<ol> 
[authority] became effective.
<nl>(d)<ol>[(e)] General information. <nl>The provisions of sec.3.319 of this 
title (relating to Prior Contracts) concerning definitions and exclusions to the 
prior contract exemptions apply to this section.
(1)  Written contracts or bids executed prior to the effective date of 
imposition of <nl>the transit <ol> [MTA] sales and use tax which require a 
retailer to sell tangible personal property or taxable services to a user or 
consumer at a set price, to be delivered on or after the effective date of the 
<nl>transit<ol> [MTA] tax will be exempt from the <nl>transit<ol> [MTA] tax. See 
subsection (d) of this section regarding the statute of limitations for prior 
contracts.
(2) If a written contract executed prior to the effective date of the 
<nl>transit<ol> [MTA] sales and use tax requires a retailer or lessor to lease 
or rent tangible personal property to another person for use [by him as lessee], 
the retailer or lessor will not be required to collect the <nl>transit<ol> [MTA] 
sales <nl>or use<ol> tax and lessee will be exempt from the <nl>transit sales 
or<ol> [MTA] use tax on the use of said property. Any renewal or exercise of an 
option to extend the time of the lease or rental contract shall be deemed to be 
a new contract. See subsection (d) of this section regarding the statute of 
limitations for prior contracts.
<nl>(e) Prior contract exemption certificate. An identification number is 
required on the exemption certificates furnished to vendors. The identification 
number should be the person's federal employer's identification (FEI) number or 
social security number if the person has not been assigned an FEI number. A 
suggested form for the exemption certificate is shown on the last page of this 
section.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 30, 1991.
TRD-9113456
Martin Cherry
Chief, General Law Section
Comptroller of Public Accounts
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-4028
       
Part IV. Employees Retirement System of Texas
Chapter 73. Benefits
34 TAC sec.73.31
The Employees Retirement System of Texas proposes new sec.73.31, concerning 
adjustment to annuities. There will be an adjustment to annuities with an 
effective date prior to September 1, 1991, in order to recognize changes in plan 
design.
William S. Nail, general counsel, has determined that for the first five-year 
period the section is in effect there will be no fiscal implications as a result 
of enforcing or administering the section.
Mr. Nail also has determined that for each year of the first five years the 
section as proposed is in effect the public benefit anticipated as a result of 
enforcing the section will be annuitants will receive benefits from adjustment 
to annuities resulting from changes in plan design. There will be no effect on 
small businesses. There is no anticipated economic cost to persons who are 
required to comply with the section as proposed.
Comments on the proposal may be submitted to William S. Nail, General Counsel, 
P.O. Box 13207, Austin, Texas 78711-3207.
The new section is proposed under the Texas Government Code, sec.814.602, which 
provides the Employees Retirement System of Texas with the authority to adopt 
rules that adjust or modify annuities to the extent necessary to be consistent 
with changes in plan design.
sec.73.31. Adjustment to Annuities.
(a) Annuities with an effective date before September 1, 1991, that are based on 
service retirements or deaths pursuant to Title 8, Government Code, 
sec.sec.814.104, 814.106, 814.107, 814.301(b), 814.302, or 814.305, shall be 
adjusted pursuant to the following plan design changes:
(1) current percentage value for each year of service credited at time of 
retirement;
(2) current applicable reduction factors;
(3) current minimum standard annuity;
(4) current maximum service percentage value.
(b) Any adjustment pursuant to this section must be made to all annuitants who 
are similarly situated.
(c) This section supersedes conflicting portions of existing plan provisions.
(d) Adjustments to annuities under this section must be in compliance with the 
Internal Revenue Code of 1986, sec.401(a), and Title 8, Government Code, 
sec.811.006.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 31, 1991.
TRD-9113713
Charles D. Travis
Executive Director
Employees Retirement System of Texas
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 867-3336
       
Chapter 87. Deferred Compensation
34 TAC sec.sec.87.1, 87.3, 87.5, 87.7, 87.9, 87.11, 87.13, 87.15, 87.17, 87.19, 
87.21
The Employees Retirement System of Texas (ERS) proposes amendments to 
sec.sec.87.1, 87.3, 87.5, 87.7, 87.9, 87.11, 87.13, 87.15, 87.17, 87.19, and 
87.21, concerning deferred compensation, Internal Revenue Code, sec.457 Plan. 
ERS began administering the Deferred Compensation Program on January 1, 1991. 
During this initial period of administration, it has been determined that 
numerous amendments are necessary to properly administer the program.
William S. Nail, general counsel, has determined that for the first five-year 
period the section is in effect there will be no fiscal implications for state 
or local government as a result of enforcing or administering the section.
Mr. Nail, also has determined that for each year of the first five years the 
sections are in effect the public benefit anticipated as a result of enforcing 
the section will be the allowance of ERS to effectively and efficiently 
administer the Deferred Compensation Program authorized by the Internal Revenue 
Code, sec.457. State employees who choose to participate in this program will 
benefit by virtue of these rules. There will be no effect on small business. 
There is no anticipated economic cost to persons who are required to comply with 
the sections as proposed.
Comments on the proposal may be submitted to William S. Nail, General Counsel, 
P.O. Box 13207, Austin, Texas 78711-3207.
The amendments are proposed under Texas Civil Statutes, Article 6252-3g, sec.2. 
45, which provide the Employees Retirement System of Texas with the authority to 
adopt rules, regulations, plans, and procedures to carry out the purposes of the 
Act.
sec.87.1. Definitions.  The following words and terms, when used in this 
chapter, shall have the following meanings, unless the context clearly indicates 
otherwise, and whenever appropriate, the singular includes the plural, the 
plural includes the singular, and the use of any gender includes the other 
gender.
<nl>   Agency coordinator <ol>[Agency administrator]  -An employee of a state 
agency who has been designated by the agency to perform certain administrative 
functions with respect to the plan.
 FDIC-The Federal Deposit Insurance Corporation or its successor in function. 
<nl>The FDIC consists of two funds, the Savings Association Insurance Fund 
(SAIF), which insured savings associations and savings banks, and the Bank 
Insurance Fund (BIF), which insures commercial banks.
 [FSLIC-The Federal Savings and Loan Insurance Corporation or its successor in 
function.]
<nl>   Nonfiler-A qualified vendor which does not ensure that the plan 
administrator receives a quarterly report within 45 days after the due date. 
This definition includes reports that the plan administrator returns for 
completion or correction.
 Product type-A categorization of an investment product according to its 
relevant characteristics. Examples of product types are life insurance products, 
mutual funds, <nl>certificates of deposit, savings accounts, and <ol>annuities.
sec.87.3. Administrative and Miscellaneous Provisions.
(a) (No change.)
(b) Participation by state agencies in the plan.
(1) (No change.)
(2) Terminating participation in the plan.
(A) Voluntary termination.
(i)-(iv) (No change.)
(v) The <nl>agency coordinator<ol> [agency administrator] of a state agency that 
has terminated its participation in the plan is not relieved from the 
responsibilities set forth in the sections in this chapter, except to the extent 
that the agency's participants will not be making additional deferrals to the 
plan.
(B) Involuntary termination or suspension.
(i)  The plan administrator may terminate or suspend a state agency's 
participation in the plan if the agency or the agency's <nl>coordinator<ol> 
[agency administrator] violates the sections in this chapter.
(ii)-(v)  (No change.)
(vi) The <nl>agency coordinator<ol> [agency administrator] of a terminated or 
suspended state agency is not relieved from the responsibilities set forth in 
the sections in this chapter, except to the extent that the agency's 
participants will not be making additional deferrals to the plan.
(3) <nl>Agency coordinators<ol> [Agency administrators]. An  <nl>agency 
coordinator<ol> [agency administrator] is responsible for:
(A) -(G) (No change.)
(H) acting as a buffer between employees and participants on the one hand and 
qualified vendors on the other, although an <nl>agency coordinator<ol> [agency 
administrator] is not required to provide investment advice;
(I)  (No change.)
(J) assisting a participant who has retired or left state employment if the 
participant's last position in state government was with <nl>that particular<ol> 
[the] agency that employs the <nl>agency coordinator <ol> [agency 
administrator];
(K) (No change.)
(L) assisting the beneficiary of a participant whose last position in state 
government was <nl>with that particular state agency <ol> [with the agency] that 
employs the <nl>agency coordinator<ol> [agency administrator]; and
<nl>(M) notifying the plan administrator when a participant dies or separates 
from service.
<nl>(N)<ol>[(M)] performing any other duties specified in the sections in this 
chapter.
(c) (No change.)
sec.87.5. Participation by Employees.
(a) (No change.)
(b) Enrollment of participants in the plan.
(1) (No change.)
(2) The employee must submit the agreement to the  <nl>agency coordinator<ol> 
[agency administrator] of the employee's employing state agency together with 
all required documentation.
(3) (No change.)
(c)  Effective date of a participation agreement. An executed participation 
agreement is effective for compensation earned beginning with the month 
following the month in which the <nl>agency coordinator<ol> [agency 
administrator] receives the agreement from the participant.
(d) (No change.)
(e) Initial selection of life insurance products.
(1)  (No change.)
(2) The selection of a life insurance product is voidable, without loss to the 
participant or the plan, at the instance of the plan administrator or the 
participant making the selection unless the following procedures are followed in 
sequence.
(A)-(D) (No change.)
(E) The participant submits an executed participation agreement and disclosure 
form and the letter of intent to the participant's <nl>agency coordinator<ol> 
[agency administrator].
(F) The vendor sends the original policy to the  <nl>agency coordinator<ol> 
[agency administrator].
(3) (No change.)
(f) (No change.)
(g) Catch-up exception to the normal maximum amount of deferrals.
(1)-(2) (No change.)
(3) If a participant works beyond age 70.5 <nl>or normal retirement age<ol>, the 
normal retirement age for the participant is the age designated by the 
participant. However, the normal retirement age may not be later than the 
participant's separation from service.
(4) For any or <nl>all<ol> of the last three full  <nl>taxable<ol> [tax] years 
ending before <nl>the taxable year in which <ol> a participant attains normal 
retirement age, the maximum amount that the participant may defer for each tax 
year is the lesser of:
(A) (No change.)
(B) the sum of:
(i) the normal maximum amount of <nl>deferrals <ol> [compensation]; and
(ii) the portion of the normal maximum amount of <nl>deferrals<ol> 
[compensation] that the participant did not use in prior tax years commencing 
January 1, 1979, provided the participant was eligible to participate in the 
plan during those years.
(5) (No change.)
(h) Changes before a participant becomes entitled to a distribution.
(1) A participant must execute a participation agreement and file the agreement 
with the participant's <nl>agency coordinator<ol> [agency administrator] when 
the participant changes the amount of deferrals per pay period.
(2) A participant must execute a change agreement and file the agreement with 
the participant's <nl>agency coordinator<ol> [agency administrator] when the 
participant:
(A)-(D)  (No change.)
(3) (No change.)
(4) Upon receipt of a participation agreement or change agreement, an <nl>agency 
coordinator<ol> [agency administrator] shall review the agreement to determine 
whether it complies with the sections in this chapter.
(A) If a participation agreement complies, the <nl>agency coordinator<ol> 
[agency administrator] shall take the action specified in the agreement.
(B) If a change agreement complies, the <nl>agency coordinator<ol> [agency 
administrator] shall send the agreement to the plan administrator.
(5) This paragraph applies to changes of beneficiaries, changes of the qualified 
vendor or qualified investment product that receives a participant's deferrals, 
and changes to the amount a participant defers per pay period. An executed 
change agreement or participation agreement is effective beginning with the 
month following the month in which the <nl>agency coordinator <ol> [agency 
administrator] receives the agreement from the participant.
(6)-(7) (No change.)
(8) Except as permitted in sec.87.15(e)(3)(A) of this title (relating to 
Transfers), a disclosure form must accompany each change agreement when changing 
qualified vendors or qualified investment products. <nl>This requirement applies 
even if the transfer is to a different investment choice within the same 
variable annuity product. The disclosure must include all investment choices of 
the variable annuity product.
(i)-(l) (No change.)
(m) Market risk and related matters.
(1) (No change.)
(2)  A participant is solely responsible for <nl>monitoring his or her own 
investments and <ol>being knowledgeable about:
(A) the financial status <nl>and stability <ol> of the qualified vendor in which 
the participant's deferrals and investment income are invested;
(B)-(F) (No change.)
(n) (No change.)
sec.87.7. Vendor Participation.
(a) (No change.)
(b) New qualified vendors.
(1)-(2) (No change.)
[(3)  This subsection expires January 1, 1992.]
(c) Eligibility to become a qualified vendor.
(1)-(2) (No change.)
(3) Insurance companies.
(A) Upon receiving an application from an insurance company to become a 
qualified vendor, the plan administrator shall file a written request with the 
<nl>Texas Department of Insurance<ol> [State Board of Insurance] for information 
about the company.
(B) The plan administrator shall disapprove an insurance company's application 
to become a qualified vendor if the  <nl>Texas Department of Insurance <ol> 
[State Board of Insurance] notifies the plan administrator that the insurance 
company:
(i) -(iii) (No change.)
(C) (No change.)
(4) Savings and loan associations. The plan administrator shall disapprove a 
savings and loan association's application to become a qualified vendor if:
(A) (No change.)
(B) the <nl>FDIC<ol> [FSLIC] does not insure deposits with the savings and loan 
association; or
(C) (No change.)
(5) (No change.)
(C) registered with the securities commissioner.
(d)-(e) (No change.)
(f) Change of name or legal status by a qualified vendor.
(1) (No change.)
(2) If a change in legal status results in the qualified vendor's participation 
in the plan being conducted by a different legal entity, the new entity must 
apply no later than the 90th day after the change for approval as a qualified 
vendor before the entity may participate in the plan. <nl>When the plan is not 
allowing any new vendors, then the vendor would be immediately put on hold to 
new business. Participant funds would then be transferred to another qualified 
vendor in the plan. Transfers under this paragraph shall be made in accordance 
with sec.87. 15(c) and (d) of this title (relating to Transfers) and shall not 
result in fee or penalty being charged against the participant's account.
<nl>(3) If a change in legal status results in a qualified vendor's 
participation in the plan being conducted by a different legal entity that is 
also a qualified vendor, participant funds will be transferred to that qualified 
vendor, who then becomes responsible for the reporting requirements of the 
transferred funds.
(g) Voluntary termination of participation in the plan.
(1)-(4) (No change.)
(5) When a qualified vendor voluntarily terminates its participation in the 
plan, the vendor may not charge a fee  <nl>or penalty<ol> for the transfers made 
<nl>after the notice<ol> [as a result] of [the] termination.
(6)  When a qualified vendor that is an insurance company voluntarily terminates 
its participation in the plan, this paragraph applies in addition to the 
preceding paragraphs of this subsection.
(A)-(F) (No change.)
(G) A qualified vendor must inform the participant in the written notice 
required by paragraph (1) of this subsection that the participant has the rights 
specified in this paragraph. <nl>A qualified vendor must send a copy of this 
notice to the plan administrator.
(H) (No change.)
(h) Inactive qualified vendors. The plan administrator shall terminate the 
participation in the plan of an inactive qualified vendor. <nl>See sec.87.1 of 
this title (relating to Definitions).
(i) (No change.)
(j) Collateralization by banks.
(1)-(2) (No change.)
(3)  Once each month, a qualified vendor shall report deferred compensation 
information to the data collection center no later than 1 p.m., central time, on 
a call-in day. <nl>At the plan administrator's discretion, the plan 
administrator may require each qualified vendor to report additional information 
to the data collection center that the plan administrator considers necessary to 
evaluate the collateralization requirement under this subsection.
(4) -(6) (No change.)
(k) Collateralization by savings and loan associations.
(1) (No change.)
(2) In this subsection, the term "deferred compensation information" means:
(A) the amount by which the balance of each account as of the end of the 
previous month exceeds the amount insured by the <nl>FDIC<ol> [FSLIC]; and
(B) the number of accounts whose balances exceed the amount insured by the 
<nl>FDIC<ol> [FSLIC].
(3) Once each month, a qualified vendor shall report deferred compensation 
information to the data collection center no later than 1 p.m., central time, on 
a call-in day. If a qualified vendor has no accounts that exceed the amount 
insured by the <nl>FDIC<ol> [FSLIC], the vendor must report that fact <nl>and 
that month's balance<ol> to the data collection center. <nl>At the plan 
administrator's discretion, the plan administrator may require each qualified 
vendor to report additional information to the data collection center that the 
plan administrator considers necessary to evaluate the collateralization 
requirement under this subsection.
(4)-(6) (No change.)
(l) Limits on account balances in credit unions.
(1)-(4) (No change.)
(5) The plan administrator shall notify the <nl>agency coordinator<ol> [agency 
administrator] for each participant whose account exceeds $95,000. Upon 
receiving the notice, the <nl>agency coordinator<ol> [agency administrator] 
shall request the participant to specify in a change agreement:
(A)-(B)  (No change.)
(6) If a participant does not submit a change agreement to the <nl>agency 
coordintor<ol> [agency administrator] by the 30th day after receiving a request 
from his  <nl>agency coordinator<ol> [agency administrator] in accordance with 
paragraph (5) of this subsection, the <nl>agency coordinator<ol> [agency 
administrator] shall notify the plan administrator. Upon receiving the 
notification, the plan administrator shall:
(A)-(B)  (No change.)
(m) (No change.)
sec.87.9. Investment Products.
(a) (No change.)
(b) New qualified investment products.
(1)-(2) (No change.)
[(3) This subsection expires January 1, 1992.]
(c) (No change.)
(d) Review of investment products.
(1) (No change.)
(2) Additional requirements for approving investment products offered by 
insurance companies. Before the plan administrator may sign a product contract, 
the plan administrator must:
(A) obtain written confirmation from the <nl>Texas Department of Insurance<ol> 
[State Board of Insurance] that the investment product has been approved [by the 
board] for sale in Texas;
(B) -(C) (No change.)
(e) (No change.)
(f) Withdrawal of a qualified investment product from the plan.
(1)-(3) (No change.)
(4) After receiving notice of withdrawal, the plan administrator shall request 
<nl>that the agencies contact<ol> each affected participant to submit a change 
agreement for the disposition of his or her deferrals and investment income. For 
each participant from whom the plan administrator has not received a change 
agreement by the effective date of the withdrawal, the plan administrator shall 
initiate a transfer of all deferrals and investment income from the qualified 
investment product being withdrawn to other qualified investment products or to 
the deferred compensation fund.
(5) When a qualified vendor withdraws a qualified investment product from the 
plan, the vendor may not charge a fee <nl>or penalty<ol> for transfers made 
<nl>after the notice of withdrawal<ol> [as a result of the withdrawal].
(6) (No change.)
(A)-(B) (No change.)
(C) If the insurance company has a life insurance product remaining in the plan 
that is equivalent to the withdrawn life insurance product, this paragraph 
applies. [The company must offer continuing life insurance coverage to each 
participant whose deferrals and investment income were invested in the withdrawn 
life insurance product.] The insurance company shall offer continuing coverage 
in:
(i)-(ii) (No change.)
(D)-(I) (No change.)
sec.87.11. Advertising Material and Solicitation.
(a) (No change.)
(b) General requirements for advertising material.
(1)-(4) (No change.)
(5) Advertising material may not contain information or statements that conflict 
with or are misleading concerning the qualified investment product being 
advertised. <nl>The advertising material may not state that loans are permitted.
(6) (No change.)
(7) The plan administrator may not approve advertising material used by an 
insurance company or by a vendor representative of an insurance company until 
the plan administrator has obtained the <nl>Texas Department of Insurance's<ol> 
[State Board of Insurance's] written approval of the material.
(c) (No change.)
(d) General requirements for solicitation.
(1)-(6) (No change.)
(7) When soliciting business for a qualified investment product, a qualified 
vendor or vendor representative shall provide each participant a copy of the 
approved disclosure form for that product. <nl>If a variable annuity product has 
several alternative investment choices, the participant must receive disclosures 
concerning all investment choices.<ol> The form must be provided regardless of 
whether the participant decides to invest in the product.
(8) -(9) (No change.)
(e) (No change.)
sec.87.13. Disclosure.
(a) Approval of a disclosure form.
(1) A vendor or qualified vendor shall complete a disclosure form for each 
investment product that the vendor is submitting to the plan administrator for 
approval as a qualified investment product. <nl>If variable annuity product has 
several investment choices, the plan administrator must receive all disclosures 
related to those investment choices.
(2)-(5) (No change.)
(b) Contents of disclosure forms.
(1)-(2) (No change.)
(3)  A qualified vendor must attach to a disclosure form <nl>any<ol> [the] 
information that will not conveniently fit on the disclosure form itself. 
Information that a qualified vendor may attach to a disclosure form includes 
schedules of payments, fees, cash values, or any other items required to be 
disclosed.
(4)-(5) (No change.)
(c)-(d) (No change.)
sec.87.15. Transfer.
(a)-(c) (No change.)
(d) Procedures for making a transfer of all deferrals and investment income from 
a qualified investment product.
(1)-(2) (No change.)
(3) If a check is used to make a transfer, this paragraph applies.
(A) (No change.)
(B) Upon receiving the check, the plan administrator must endorse the check and 
deposit the check in the deferred compensation fund <nl>or with a qualified 
vendor selected by the plan administrator.
(C) After depositing the check in the deferred compensation fund <nl>or with the 
qualified vendor selected by the plan administrator, <ol>and receiving a list of 
affected participants from the qualified vendor, the plan administrator shall 
direct the <nl>agency coordinators<ol> [agency administrators] for the 
participants to:
(i)  (No change.)
(ii) request that each affected participant submit a change agreement to his 
<nl>agency coordintor<ol> [agency administrator] for the purpose of designating 
the qualified investment product that will receive the participant's deferrals 
and investment income.
(D)  Promptly after receiving the requested change agreements and determining 
that the agreements have been properly executed, an <nl>agency coordinator<ol> 
[agency administrator] shall send the change agreements to the plan 
administrator.
(E) (No change.)
(4) If a wire-transfer is used to make a transfer, this paragraph applies.
(A) The qualified vendor must ensure that the State Treasury Department <nl>or 
the qualified vendor selected by the plan administrator to hold these funds<ol> 
receives the wire-transfer.
(B) The State Treasury Department <nl>or the qualified vendor selected by the 
plan administrator <ol> shall promptly deposit the wire-transfer into the 
deferred compensation fund  <nl>or into the applicable account previously agreed 
upon, <ol>and notify the plan administrator concerning the deposit.
(C) After the plan administrator receives notice that the State Treasury 
Department <nl>or the qualified vendor chosen by the plan administrator to hold 
these funds <ol>has deposited the wire-transfer and after the plan administrator 
has received a list of affected participants from the vendor, the plan 
administrator shall direct the <nl>agency coordinators<ol> [agency 
administrators] for the participants to:
(i) (No change.)
(ii) request that each affected participant submit a change agreement to his 
<nl>agency coordinator<ol> [agency administrator] for the purpose of designating 
the qualified investment product that will receive the participant's deferrals 
and investment income.
(D) Promptly after receiving the requested change agreements and determining 
that the agreements have been properly executed, an <nl>agency coordinator<ol> 
[agency administrator] shall send the change agreements to the plan 
administrator.
(E) (No change.)
(e) Procedures for making a transfer of less than all deferrals and investment 
income from a qualified investment product.
(1) (No change.)
(2) If the plan administrator initiates a transfer, this paragraph applies.
(A)-(C) (No change.)
(D) After depositing the check, the plan administrator must notify the 
<nl>agency coordinator <ol> [agency administrator] for the participant whose 
deferrals and investment income were moved. The notification must:
(i)  (No change.)
(ii) direct the  <nl>agency coordinator<ol> [agency administrator] to request 
that the participant complete a change agreement to designate the qualified 
investment product that will receive the participant's deferrals and investment 
income; and
(iii) for a transfer from a credit union under subsection (b) (2) of this 
section, direct the <nl>agency coordinator<ol> [agency administrator] to inform 
the participant that the participant may require the reinvestment of the 
transferred amounts in the credit union, unless the plan administrator 
determines that reinvestment in the credit union would not be in the best 
interests of the plan.
(E)-(F)  (No change.)
(3) If a participant initiates a transfer, this paragraph applies.
(A) A participant may initiate a transfer of the participant's deferrals and 
investment income only through the execution of a change agreement and a 
disclosure form in accordance with  s87.5(h) of this title (relating to 
Participation by Employees). <nl>This requirement applies to all tranfers, even 
transfers within the same vendor.<ol> A transfer is voidable at the instance of 
the plan administrator or the participant making the transfer if both a change 
agreement and a disclosure form are not properly executed and filed. However, a 
disclosure form is not required when a participant initiates a transfer to an 
existing account for the same participant, regardless of whether the account is 
with another qualified vendor.
(B)-(E) (No change.)
(f) (No change.)
(g) Transfers into life insurance products.
(1) A transfer into a life insurance product is voidable, without loss to the 
participant or the plan, at the instance of the plan administrator or the 
participant making the transfer unless the following procedures are followed in 
sequence.
(A)-(D) (No change.)
(E) The participant submits an executed participation agreement, change 
agreement, disclosure form, as applicable, and the letter of intent to the 
participant's <nl>agency coordinator<ol> [agency administrator].
(F) The vendor sends the original policy to the  <nl>agency coordinator<ol> 
[agency administrator].
(2) (No change.)
sec.87.17. Distributions.
(a)-(b) (No change.)
(c) Content of a distribution agreement.
(1) A distribution agreement must contain, but shall not be limited to:
(A) identifying information concerning the participant, including the <nl>date 
of birth and social security number <ol> [age] of the participant;
(B) (No change.)
(C) the type of qualified investment product from which distributions will be 
made<nl>, including policy/certificate/or account number: <ol>[;]
(D)-(H) (No change.)
(I) beneficiary information, <nl>including date of birth(s) and social security 
number(s)<ol> [at the option of the person filing the distribution agreement].
(2)-(3) (No change.)
(d) Commencement of distributions. Notwithstanding anything in a distribution 
agreement:
(1)  (No change.)
(2) the latest a participant may begin receiving a distribution is the later of:
(A) April 1st of the calendar year following the calendar year in which the 
employee attains age 70.5; <nl>or <ol> [and]
(B) (No change.)
(e) Filing of distribution agreements by participants.
(1)-(2) (No change.)
(3) A distribution agreement must be filed:
(A) with the participant's <nl>agency coordinator <ol> [agency administrator]; 
and
(B) (No change.)
(4) If a participant complies with paragraphs (2) and (3) of this subsection, 
the relevant <nl>agency coordinator<ol> [agency administrator] shall review the 
distribution agreement for compliance with the sections in this chapter.
(5) If the distribution agreement complies with the sections in this chapter, 
the <nl>agency coordinator <ol> [agency administrator] shall sign and send the 
agreement to the plan administrator. The <nl>agency coordinator <ol> [agency 
administrator] shall ensure that the plan administrator receives the signed 
distribution agreement no later than the 30th day after the occurrence of the 
event that entitles the participant to the distribution.
(6) If a participant does not comply with paragraphs (2) and (3) of this 
subsection, the relevant <nl>agency coordinator<ol> [agency administrator] shall 
submit a written request to the plan administrator for an immediate lump-sum 
distribution to the participant of all the participant's deferrals and 
investment income. Proof that the <nl>agency coordinator<ol> [agency 
administrator] notified the participant concerning the necessity to file a 
distribution agreement must accompany the written request. The <nl>agency 
coordinator <ol> [agency administrator] shall ensure that the plan administrator 
receives the request and proof no later than the 30th day after the occurrence 
that entitles the participant to the distribution.
(7) Notwithstanding anything to the contrary in this subsection, a participant 
who has not separated from service and who has reached age 70.5 must file a 
distribution agreement only if he wants distributions to begin to him. The 
distribution agreement must be filed with the participant's <nl>agency 
coordinator<ol> [agency administrator]. The <nl>agency coordinator <ol> [agency 
administrator] shall review and forward the distribution agreement in accordance 
with paragraphs (4) and (5) of this subsection.
(f) Filing of distribution agreements by beneficiaries.
(1) (No change.)
(2) The beneficiary named in a participant's participation agreement, change 
agreement, or distribution agreement must ensure that the participant's 
<nl>agency coordinator <ol> [agency administrator] receives the beneficiary's 
distribution agreement by no later than the 88th day after the participant's 
death.
(3) The requirements in subsection (e) of this section apply to the distribution 
agreements of beneficiaries except an <nl>agency coordinator<ol> [agency 
administrator] must ensure that the plan administrator receives a distribution 
agreement by no later than the 90th day after the participant's death.
(g) (No change.)
(h) Review of distribution agreements by the plan administrator. The plan 
administrator shall review each distribution agreement received from an 
<nl>agency coordinator <ol> [agency administrator] to ensure that:
(1)-(2)  (No change.)
(i) Amendments of distribution agreements.
(1)-(3)  (No change.)
(4) Beneficiaries.
(A) The primary and secondary beneficiaries named in a distribution agreement 
may be changed at anytime by filing a change agreement with the <nl>agency 
coordinator <ol> [agency administrator] of the state agency at which the 
participant was employed.
(B) Upon receipt of the change agreement, the <nl>agency coordinator<ol> [agency 
administrator] shall send the agreement to the plan administrator.
(C) (No change.)
(5) (No change.)
(6) Transfers after a distribution has begun.
(A) (No change.)
(B) The distribution agreement of the participant or beneficiary may be amended 
only to change the name or type of [the] qualified investment product or 
qualified vendor listed in the agreement.
(C) (No change.)
(7) Procedures for amending a distribution agreement.
(A) A participant or beneficiary who wants to amend his distribution agreement 
must file an amended distribution agreement with his <nl>agency coordinator<ol> 
[agency administrator]. The amended distribution agreement must contain the word 
"Amended" at the top of the agreement.
(B)  Upon receipt of the amended distribution agreement, the <nl>agency 
coordinator<ol> [agency administrator] shall promptly review the agreement for 
compliance with the sections in this chapter.
(C) If the amended distribution agreement does not comply with the sections in 
this chapter, the <nl>agency coordinator<ol> [agency administrator] shall 
promptly return the agreement to the participant or beneficiary for corrections.
(D) If the amended distribution agreement complies with the sections in this 
chapter, the <nl>agency coordinator <ol> [agency administrator] shall 
immediately sign the agreement and send it to the plan administrator.
(E) After the plan administrator receives a signed distribution agreement from 
an <nl>agency coordinator <ol> [agency administrator], the plan administrator 
and the qualified vendor covered by the agreement shall take the steps specified 
in subsections (h) and (j) of this section.
(8) (No change.)
(j) (No change.)
(k) Emergency withdrawals.
(1)-(8) (No change.)
<nl>(9) If the plan administrator approve a participant's request for an 
emergency withdrawal, the participant must agree to cease all deferrals to both 
this plan and the TexaSaver plan for a 12-month period following the approval.
<nl>(10)<ol>[(9)] The plan administrator may not approve an emergency withdrawal 
request from a primary or secondary beneficiary.
(l) -(p) (No change.)
(q) Distributions to missing persons.
(1) (No change.)
(2) When the plan administrator does not know the location of a participant or 
beneficiary, the <nl>agency coordinator<ol> [agency administrator] for the 
participant or beneficiary must send a certified letter to the last known 
address of the participant or beneficiary.
(3) If the certified letter does not result in the discovery of the location of 
the participant or beneficiary, the <nl>agency coordinator<ol> agency 
administrator] shall inform the plan administrator and provide proof to the plan 
administrator that the certified letter was sent.
(4) Upon receiving the notification and proof from an <nl>agency coordinator<ol> 
[agency administrator], the plan administrator may direct that all benefits due 
the participant or beneficiary be deposited in the deferred compensation fund or 
a qualified investment product that the plan administrator has specifically 
designated for this purpose.
(r)-(s) (No change.)
(t) Federal withholding and reporting requirements.
(1) A qualified vendor shall file all reports required by the Internal Revenue 
Service <nl>(IRS)<ol> when any deferrals and investment income are distributed 
or otherwise made available to a participant or beneficiary. [All distributions 
to the participant or beneficiary are taxable as ordinary income and must be 
reported on a W-2 Form.]  <nl>Payments made to participant during the 
participant's life must be reported as taxable wages on an IRS Form W-2, or 
another appropriate form which may be hereafter promulgated by the IRS. Pursuant 
to the provisions of Internal Revenue Service Revenue Ruling 86-109 (1986-2 CB 
196), payments to the beneficiary of a deceased participant must be reported on 
IRS Form 1099-MISC (or another appropriate form which may be hereafter 
promulgated by the IRS) a taxable income of the beneficiary.
(2) -(3) (No change.)
(4) Federal tax withholding is mandatory <nl>for distributions to participant.  
<ol>A qualified vendor shall accurately determine any amounts to be withheld for 
federal taxes based on a W-4 submitted by the participant [or beneficiary] at 
the time of a distribution. If no W-4 is provided, the participant [or 
beneficiary] must be considered single with no dependents. The Tax Equity and 
Fiscal Responsibility Act does not apply to a deferred compensation plan 
governed by the Internal Revenue Code of 1986, sec.457.
(5) Total death benefits, including life insurance proceeds, are taxable as 
ordinary income to the beneficiary and must be reported on a <nl>Form 1099-MISC 
in accordance with paragraph (1) of this subsection<ol> [W- 2].
(6) A qualified vendor shall mail a copy of all reports filed with the Internal 
Revenue Service about a participant  <nl>or beneficiary<ol> to the participant's 
<nl>or beneficiary's<ol> home address.
sec.87.19. Reporting and Record Keeping by Qualified Vendors.
(a)  Definition of "current market value." In this section, the term "current 
market value" has the following meanings.
(1)-(4) (No change.)
(5) For an investment in an annuity, "current market value" <nl>equals<ol> 
[means] the amount of deferrals plus investment income minus payouts minus 
applicable fees. <nl>This definition also applies to annuitized accounts.
(b) Reports to participants.
(1) Generally.
(A)  A qualified vendor shall issue a report after the end of each calendar 
quarter to each participant whose deferrals and investment income are invested 
in a qualified investment product offered by the vendor<nl>, even if the 
investment is in a product that is annuitized.
(B)-(D) (No change.)
(2)-(3) (No change.)
(c) Reports to the plan administrator.
(1) Frequency and coverage of reports. <nl>Every vendor that has participant 
deferrals and/or investment income <ol> [A qualified vendor] shall ensure that 
the plan administrator receives a report [from the vendor] no later than the 
35th day after the end of each calendar quarter. The report must be in the 
format specified in this subsection and must cover all transactions during the 
calendar quarter.
(2) Content of reports. For each participant whose deferrals and investment 
income are invested in a qualified investment product offered by the vendor, the 
report required by this subsection, must contain:
(A)  the participant's name<nl>, agency code,<ol> and social security number;
(B) a list of the qualified investment products in which the participant's 
deferrals and investment income have been invested, <nl>even if the investment 
is in a product that is annuitized:
(C)-(G) (No change.)
(3) Format of reports.
(A) (No change.)
(B) <nl>Only qualified vendors with less than 50 participants are eligible to 
report on a manual form<ol> [A qualified vendor in whose qualified investment 
products 50 or more participants have invested their deferrals and investment 
income may not use the manual form].
(C)-(F) (No change.)
(4) Late reports.
(A)-(B) (No change.)
[(C) A qualified vendor which does not ensure that the plan administrator 
receives a report no later than the 45th day after the due date is a nonfiler. 
This subparagraph also applies to reports that the plan administrator returns 
for completion or correction.]
(d) (No change.)
sec.87.21. Remedies.
(a) Remedies for violations of the sections in this chapter.
(1)-(4)  (No change.)
(5) The plan administrator shall suspend or expel  <nl>a nonfiler<ol> [a 
qualified vendor] that does not file a report with the plan administrator for 
any two quarters in a 12-month period.
(6) The plan administrator shall suspend or expel  <nl>a nonfiler<ol> [a 
qualified vendor] that files three or more delinquent reports within a 12-month 
period.
(7)-(10) (No change.)
(b) Transfers from qualified vendors that violate the sections in this chapter.
(1)-(2) (No change.)
(3) If the plan administrator suspends a qualified vendor from participation in 
the plan, the plan administrator may take the actions specified in paragraph (1) 
of this subsection.  <nl>Whether the plan administrator takes those actions or 
not,<ol> [If the plan administrator does not take those actions,] the qualified 
vendor shall continue to file the reports required by the sections in this 
chapter. The plan administrator shall order the expulsion of a suspended vendor 
that does not file the required reports.
(4)-(5)  (No change.)
(c)-(g) (No change.)
(h) Violations of state insurance or securities laws. The plan administrator 
shall refer possible violations of state insurance or securities laws or 
regulations to the <nl>Texas Department of Insurance<ol> [State Board of 
Insurance] or the State Securities Board for appropriate action.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 30, 1991.
TRD-9113564
Charles D. Travis
Executive Director
Employees Retirement System of Texas
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 867-3336
       
Part IX. Texas Bond Review Board
Chapter 190. Allocation of the State's Limit on Certain Private Activity Bonds
Subchapter A. Bond Review Rules
34 TAC sec.sec.190.1-190.8
The Texas Bond Review Board proposes new sec.sec.190.1-190.8 concerning 
allocation of the state's limit on certain private activity bonds. The new 
sections provide the public with the information necessary to understand the 
allocation and reservation system, the filing requirements to apply for a 
portion of the state's ceiling, and the procedures for securing a final 
allocation to allow for the issuance of certain tax-exempt private activity 
bonds.
Tom K. Pollard, executive director of the Bond Review Board, has determined that 
there will be negligible fiscal implications as a result of enforcing or 
administering the new sections.
The fiscal impact on state government will be negligible for each year of the 
first five years that the new sections are in effect.
There will be no fiscal impact on local government for each year of the first 
five years that the new sections are in effect.
Mr. Pollard, also has determined that for each year of the first five years that 
the new sections as proposed are in effect the public benefit anticipated as a 
result of enforcing the sections as proposed will be the benefit to eligible 
entities of being able to access tax-exempt bond financing and, therefore, to 
borrow at a more affordable interest rate.
The anticipated economic cost to persons who are required to comply with the 
sections as proposed will be limited to the application and closing fees 
required by state law.
Comments may be submitted to Tom K. Pollard, Executive Director, Texas Bond 
Review Board, P.O. Box 13292, Austin Texas 78711-3292.
The new sections are proposed under Texas Civil Statutes, Article 5190.9a, which 
gives the Texas Bond Review Board the authority to propose rules pertaining to 
the adoption, implementation, and administration of the allocation of the 
state's ceiling on private activity bonds.
sec.190.1. General Provisions.
(a) Introduction. Pursuant to the authority granted by the Administrative 
Procedure and Texas Register Act, Texas Civil Statutes, Article 6252-13a, and 
Texas Civil Statutes, Article 5190. 9a, the Bond Review Board prescribes the 
following sections regarding practice and procedure before the board in the 
administration of the allocation of the authority in the state to issue private 
activity bonds.
(b) Objective. The objective of the sections in this chapter is to establish the 
most-equitable and efficient means of allocating the state ceiling on private 
activity bonds in accordance with the Act. The intent of the board is to 
formulate policies and guidelines that would provide standards of eligibility 
and procedures for applications submitted to reserve a portion of the state 
ceiling for private activity bonds.
(c) Definition of terms. The following words and terms, when used in this 
section, shall have the following meanings, unless the context clearly indicates 
otherwise.
(1) Act-Texas Civil Statutes, Article 5190.9a.
(2)  Amount-With respect to bonds, reservation certificate, or a portion of the 
state ceiling, is a sum measured in terms of United States dollars.
(3)  Application fee-The $500 nonrefundable application fee submitted to the 
board simultaneously with an application for reservation or an application for 
carryforward.
(4) Application for carryforward-The application for a carryforward required to 
be filed by an issuer with all attachments and amendments to reserve a portion 
of the state ceiling for carryforward purposes.
(5) Application for reservation-The application for reservation required to be 
filed by an issuer with all attachments to reserve a portion of the state 
ceiling.
(6) Authorized representative-A representative authorized by the issuer to 
execute certain correspondence under sec.190.5(i) and (j) of this title 
(relating to Consideration of Qualified Applications by the Board).
(7) Available-Any amount of the state ceiling set aside for reservations by an 
issuer upon compliance with the terms of the Act and this chapter.
(8) Board-The Bond Review Board created under Chapter 1078, Acts of the 70th 
Legislature, Regular Session, 1987 (Texas Civil Statutes, Article 717k-7).
(9) Bond authorization requirements-Those requirements that are to be filed by 
the issuer no later than 35 days after the issuer's reservation date.
(10) Bonds-Includes all bonds, certificates, notes, and other obligations 
authorized to be issued by any issuer by any statute, city home-rule charter, or 
the Texas Constitution and which are subject to the limitations of the Code, 
sec.146.
(11) Borrower-Any person or persons whose private business use, within the 
meaning of the code, would cause any bonds to constitute private activity bonds 
within the meaning of the code. If there is more than one such person with 
respect to any issue of bonds, then the term shall mean and include each and 
every such person known at the time that the issuer files an application for 
reservation or an application for carryforward, except that any one of such 
persons may execute any such application, letter, or other writing which the Act 
and this chapter requires to be executed by the borrower.
(12) Business day-A day on which the board is open for business. The term shall 
not include any Saturday, Sunday, or holiday officially observed by the state. 
The board's normal business hours are 8 a.m. to 5 p.m. each business day.
(13) Carryforward-The amount of the state ceiling that has not been reserved 
before December 15 and any amount previously reserved that becomes available on 
or after that date because of the cancellation of a reservation.
(14) Certificate of allocation-The notice given by the board to an issuer 
confirming the issuance of bonds receiving a portion of the state ceiling 
pursuant to the Act and the code.
(15) Certificate of delivery-The notice given to the board by the issuer stating 
the closing date of the bonds and the amount of bonds issued and delivered at 
closing.
(16) Certificate of reservation-The notice given by the board to an issuer 
reserving a specific amount of the state ceiling for a specific issue of bonds.
(17) Certification regarding fees-The notice given to the board by legal counsel 
stating that a check for a required fee was sent by overnight delivery as 
described in sec.190.8(c) of this title (relating to Notices, Filings, and 
Submissions) in a timely manner.
(18) Close or closing-The issuance and delivery of bonds by an issuer in 
exchange for the required payment therefore, or in the case of mortgage credit 
certificates, the date when an issuer elects not to issue qualified mortgage 
bonds and establishes a mortgage credit certificate program under the code. The 
term does not include a delivery of bonds if the expenditure of the proceeds of 
the bonds is conditioned on obtaining credit enhancement in support of the 
bonds.
(19) Closing date-The date on which the bonds have been issued and delivered in 
exchange for the required payment therefore.
(20) Closing documents-Those documents that are required to be filed by the 
issuer not later than the fifth day after the day on which the bonds are closed.
(21) Closing fee-The nonrefundable fee in the amount of $1,000 or 0. 025% of the 
principal amount of the bonds certified as provided by the Act, sec.6(a)(2), 
whichever is greater. The foregoing notwithstanding, an issuer exchanging a 
portion of the state ceiling for mortgage credit certificates shall submit to 
the board a closing fee in the amount of $1,000 or 0.0125% of the amount of the 
state ceiling reserved, whichever is greater.
(22) Code-The Internal Revenue Code of 1986, as the same from time to time may 
be amended.
(23) Election-An election by an issuer of qualified mortgage bonds to convert 
its bond authority to mortgage credit certificates under applicable sections of 
the code.
(24) Executive director-The executive director of the board.
(25) Finance team members-Members associated with the specific bond issue and 
project or mortgage credit certificate program which may include the issuer, 
user, bond counsel, placement agent, or underwriter, trustee, or any other 
members.
(26) Governing body-The board, council, commission, commissioners' court, or 
legislative body of the governmental unit.
(27) Governmental unit-A city, county, or other political subdivision which may 
create and utilize a corporation, or act for and on its behalf.
(28) Housing finance corporation-A corporation created under the Texas Housing 
Finance Corporations Act, Texas Local Government Code, Chapter 394.
(29) Issued-Bonds that have actually been delivered and paid for in full. The 
date of issuance shall be the date on which the bonds have been delivered and 
paid for in full.
(30) Issuer-Any department, board, authority, agency, subdivision, municipal 
corporation, political subdivision, body politic, or instrumentality of the 
State of Texas of every kind or type whatsoever and any non-profit corporation 
acting for or on behalf of any of the foregoing.
(31) Joint housing finance corporation-A housing finance corporation acting on 
behalf of more than one local governmental unit as provided in the Texas Housing 
Finance Corporations Act, Texas Local Government Code, Chapter 394, sec.394.012.
(32) Local governmental unit-Any city or county.
(33) Local population-The population in the local governmental unit or units on 
whose behalf a housing finance corporation is created as determined by the most 
recent federal census estimate. If two local governmental units which overlap 
have each created housing finance corporations, prior to the submission of 
either the application for reservation or the application for carryforward by 
either housing finance corporation, there shall be excluded from the population 
of the larger local governmental unit that portion of the population of any 
smaller local governmental unit having a population as determined by the most 
recent federal census estimate of 20,000 or more which is within the larger 
local governmental unit, unless the smaller local governmental unit assigns its 
authority to issue qualified mortgage bonds, based upon its population, to the 
larger local governmental unit.
(34) Locally voted issue-An issue of bonds which has been authorized pursuant to 
a referendum approved by the voters of a political subdivision of the State of 
Texas.
(35) Mortgage credit certificate-A certificate of the nature described in the 
Code, sec.25.
(36) Prepayments-Reduction of the principal amount of a loan that was originated 
from bond proceeds resulting in a corresponding reduction of the principal 
amount of the bond proceeds.
(37) Private activity bond-A private activity bond within the meaning given that 
term under the code.
(38) Project-Any eligible facility, as described in the application for 
reservation or carryforward, proposed to be financed, in whole or in part, by an 
issue of bonds. With respect to qualified mortgage bonds or student loan bonds, 
the board shall consider the project or purpose to be the provision of financial 
assistance to qualifying mortgagors or students within all or any portion of the 
jurisdiction of the issuer.
(39) Qualified application-A completed application for reservation or an 
application for carryforward.
(40) Qualified bond-A qualified bond within the meaning given that term under 
the code.
(41) Qualified mortgage bond-A qualified mortgage bond within the meaning given 
that term under the code, including mortgage credit certificates.
(42) Qualified residential rental project issue-An issue of bonds for a 
qualified residential rental project, as that term is defined under the code, 
sec.142(d).
(43) Qualified small issue bond-A qualified small issue bond within the meaning 
given that term under the code.
(44) Related person-Related person within the meaning given that term under the 
code.
(45) Reservation-A reservation of a portion of the state ceiling for a specific 
bond issue.
(46) Reservation date-The earliest date on which a qualified application for 
reservation is accepted for filing with the board pursuant to the Act and a 
portion of the state ceiling is or becomes available to the issuer.
(47) Rules-Any statement of general applicability that implements, interprets, 
or prescribes law or policy, or describes the board's procedures and practice.
(48) Significant expenditures-Expenditures greater than the lesser of $1 million 
or 10% of the reasonably anticipated cost of the project.
(49) Staff-The staff of the board.
(50) State-The State of Texas.
(51) State ceiling-The amount of the authority in the state to issue tax exempt 
private activity bonds during the calendar year, as defined under the code.
(52) State voted issue-An issue of bonds which has been authorized pursuant to a 
statewide referendum approved by the voters of the state.
(d)  Amendment and suspension of sections. These sections may be amended by the 
board at any time in accordance with the Administrative Procedure and Texas 
Register Act, Texas Civil Statutes, Article 6252-13a, as amended.
(e)  Statements and opinions. Statements and opinions expressed orally or in 
writing by the staff in response to inquiry or otherwise, and not specifically 
identified and promulgated as sections, shall not be considered regulatory 
standards of the board and shall not be considered binding upon the executive 
director in consideration with specific determinations undertaken by the board 
or the executive director thereafter.
(f) Examination of records. Any party requesting the examination of records 
pursuant to the Open Records Act, Texas Civil Statutes, Article 6252-17a, shall 
indicate in writing the specific nature of the document to be viewed, and if 
photocopying is desired, the appropriate fee must accompany the request.
sec.190.2. Allocation and Reservation System.
(a) The state's ceiling shall be determined for each calendar year by the 
executive director based upon the most recent census estimate of the resident 
population of the state published by the Bureau of the Census prior to the 
beginning of such calendar year. The amount of the state ceiling shall be 
published in the Texas Register<ol> in the first January issue of each year.
(b) On or after January 2, the board will accept applications for reservation 
from issuers authorized to issue private activity bonds. The board shall not 
grant a reservation to any issuer prior to January 10. If two or more issuers 
file an application for reservation of the state ceiling in any of the 
categories described in the Act, sec.2(b), the board shall conduct a lottery 
establishing the order of priority of each such application for reservation. 
Once the order of priority for all applications for reservation filed on or 
before January 10 is established, reservations for each issuer within the 
categories described in the Act, sec.2(b)(2)-(5) shall be granted in the order 
of priority established by such lottery. If more than 10 applications are 
granted a reservation initially, an additional lottery will be held immediately 
to determine staggered reservation dates. The order of priority for reservations 
in the category described in the Act, sec.2(b)(1), shall further be determined 
as provided in the Act, sec.3(c).
(1) The first category of priority shall include those applications for a 
reservation filed by housing finance corporations which filed an application for 
a reservation on behalf of the same local population prior to September 1 of the 
previous calendar year, but which did not receive a reservation during such 
year.
(2) The second category of priority shall include those applications for a 
reservation filed by housing finance corporations to which state ceiling could 
not be made available by August 31 for that calendar year because of the 
application of the Act, sec.4(b).
(3)  The third category of priority shall include those applications for a 
reservation not included in the first and second categories of priority.
(4) Within each category of priority, reservations shall be granted in reverse 
calendar year order of the most recent closing of qualified mortgage bonds by 
each housing finance corporation, with the most recent closing being the last to 
receive a reservation and with those housing finance corporations that have 
never received a reservation for mortgage revenue bonds being the first to 
receive a reservation, and, in the case of closings occurring on the same date, 
reservations shall be granted in an order determined by the board by lot. All 
applications for a reservation filed after January 10 by any issuer for the 
issuance of bonds shall be accepted by the board in their order of receipt.
(c) If any issuer which was subject to the lottery conducted as described above 
does not, prior to September 1 of that year, receive the amount requested by 
such issuer in its application for reservation filed on or before January 10, 
and if state ceiling becomes available on or after September 1 such issuer, 
subject to the provisions of the Act, sec.3(a), shall receive a reservation for 
any state ceiling becoming available on or after September 1 in the order of 
priority established by such lottery, without regard to the provisions of the 
Act sec.3(c), relating to the order of priority for the category described in 
the Act, sec.2(b)(1).
(d) An application for a reservation may not be submitted after December 14.
(e) The amount of the state's ceiling that has not been reserved prior to 
December 15 and any amount previously reserved that becomes available on or 
after that date because of the cancellation of a reservation or any other 
reason, may be designated, by the board, as carryforward for the carryforward 
purposes outlined in the code through submission of the application for 
carryforward and any other required documentation.
(f) An issuer may submit an application for carryforward to the board at any 
time during the year through the last business day in December.
(g) Issuers will be eligible for carryforward according to the priority 
classifications listed in the Act.
sec.190.3. Filing Requirements for Applications for Reservation.
(a) Form. Applications must be filed on forms prescribed by the board and must 
contain all information and documentation required under the Act and this 
chapter, as applicable.
(b) Application filing. The issuer shall submit one original and two copies of 
the application for reservation. Each application must be accompanied by the 
following:
(1) the application fee;
(2)  the Certificate Regarding Fees, on the form prescribed by the board;
(3) a copy of the inducement resolution or other similar official action taken 
by the issuer with respect to the bonds and the project which are the subject of 
the application, certified by an officer of the issuer; or a copy of the 
certified resolution of the issuer authorizing the filing of the application for 
reservation;
(4) a statement by the issuer, other than an issuer of a state-voted issue, that 
the bonds are not being issued for the same stated purpose for which the issuer 
has received sufficient carryforward during a prior year or for which there 
exists unexpended proceeds from a prior issue or issues of bonds issued by the 
same issuer;
(5) if unexpended proceeds exist from a prior issue or issues of bonds issued by 
issuer or on behalf of issuer for the same stated purpose for which the bonds 
are the subject of this application, a statement by the trustee as to the 
current amount of unexpended proceeds that exists for each such issue. The 
issuer shall certify to the current amount of unexpended proceeds that exists 
for each issue should a trustee not administer the bond issues;
(6) if unexpended proceeds other than prepayments exist from a prior issue or 
issues of bonds issued by issuer or on behalf of issuer for the same stated 
purpose for which the bonds are the subject of this application, a definite and 
binding financial commitment agreement which must accompany the application in 
such form as the board finds acceptable, to expend the unexpended proceeds 
within 12 months after the date of receipt by the board of an application for 
reservation. For purposes of this paragraph, the commitment by lenders to 
originate and close loans within a certain period of time shall be deemed a 
definite and binding agreement to expend bond proceeds within such period of 
time and any additional period of time during which such origination period may 
be extended under the terms of such agreement; provided however, that any such 
extension provision may be amended, prior to date on which the bond 
authorization requirements described in subsection (c) of this section must be 
satisfied, to provide that such period shall not be extended beyond 12 months 
after the date of receipt by the board of an application for reservation;
(7) if unexpended proceeds exist from a prior issue or issues of bonds issued by 
issuer or on behalf of issuer for the same stated purpose for which the bonds 
are the subject of the pending application, a written opinion of legal counsel, 
addressed to the board, to the effect, that the board may rely on the 
representation contained in the application to fulfill the requirements of the 
Act and that the agreement referred to in paragraph (5) of this subsection 
constitutes a legal and binding obligation of the issuer, if applicable, and the 
other party or parties to the agreement;
(8) a written opinion of legal counsel, addressed to the board, to the effect 
that the bonds are required to be included under the state ceiling and that the 
issuer is authorized under the laws of the state to issue bonds for projects of 
the same type and nature as the project which is the subject of the application. 
This opinion shall cite by constitutional or statutory reference, the provision 
of the Constitution or law of the state which authorizes the bonds for the 
project; and
(9) a qualified mortgage bond issuer that submits an application for reservation 
as described in the Act, sec.3(c), shall provide a statement certifying to the 
most recent closing of qualified mortgage bonds or the most recent date of a 
reservation received for mortgage revenue bonds and state the governmental 
unit(s) for which the local population was based for the issuance of bonds or 
for receipt of a reservation.
(c) Bond authorization requirements. Not later than 35 calendar days after an 
issue's reservation date, the issuer shall submit to the board:
(1) one-third of the closing fee;
(2) the Certificate Regarding Fees, on the form prescribed by the board;
(3) a certificate signed by the issuer that certifies the principal amount of 
the bonds to be issued or the portion of the state ceiling that will be 
converted to mortgage credit certificates;
(4) a list of finance team members with their addresses and telephone numbers;
(5) if applicable, an amended agreement pursuant to subsection (b)(5) of this 
section;
(6) a bond authorization requirements checklist, on the form prescribed by the 
board
(d) Closing fee. The remaining two-thirds of the fee must be paid simultaneously 
with closing on the bonds. The issuer should submit the fee to the board not 
later than the fifth calendar day after the day on which the bonds are closed.
(e)  Closing documents. Not later than the fifth calendar day after the day on 
which the bonds are closed the issuer shall file with the board:
(1) a Certificate Regarding Fees, on the form prescribed by the board;
(2) a closing documents checklist, on the form prescribed by the board;
(3) a certificate of delivery on the form prescribed by the board;
(4) a certified copy of the bond resolution authorizing the issuance of bonds, 
and setting forth the specific principal amount of the bond issue;
(5) if one is required, a copy of the approval of the governmental unit or 
governmental units, certified by a public official with the authority to certify 
such approval. This requirement shall not apply to any bonds for which the code 
does not require such a public hearing and approval of a governmental unit or 
governmental units;
(6) other documents relating to the issuance of bonds, including a statement of 
the bonds':
(A) principal amount;
(B) interest rate or the formula by which the interest is calculated;
(C) maturity schedule;
(D) purchaser or purchasers; and
(7) an official statement.
(f) Closing documents for mortgage credit certificates shall include:
(1) a certified copy of the issuer's resolution electing to convert state 
ceiling to mortgage credit certificates;
(2) issuer's mortgage credit certificate election; and
(3)  program plan.
(g) Additional information. The board may require additional inform-ation at any 
time before granting a certificate of reservation or certificate of allocation.
(h) Application restrictions.
(1)  In order to submit an application for reservation prior to January 11 of 
the current year an issuer or borrower must have been in existence on January 1 
of that current year.
(2) Project substitutions will not be allowed after the application for 
reservation has been delivered to the board.
(3) No issuer may submit an application for reservation for the same or 
substantially the same project or projects as are contained in the application 
of another issuer.
sec.190.4. Filing Requirements for Applications for Carryforward.
(a) Form. Applications must be filed on forms prescribed by the board and must 
contain all information and documentation required under the Act and this 
chapter, as applicable.
(b) Filing. The issuer shall submit one original and two copies of the 
application for carryforward. Each application must be accompanied by the 
following:
(1) the $500 nonrefundable filing fee;
(2) the Certificate Regarding Fees, on the form prescribed by the board;
(3) a copy of the inducement resolution or other similar official action taken 
by the issuer with respect to the bonds and the project which are the subject of 
the application, certified by an officer of the issuer; or a copy of the 
certified resolution of the issuer authorizing the filing of the application for 
carryforward;
(4) documentation of priority classification;
(5) if applicable, a copy of the binding contract to incur significant 
expenditures or documentation of significant expenditures paid or incurred prior 
to submission of the application for carryforward;
(6) if significant expenditures have been paid or incurred, a written opinion of 
legal counsel, addressed to the board, to the effect, that the board may rely on 
the representation contained in the binding contract or documentation to fulfill 
the requirements of the Act; and
(7) a written opinion of legal counsel addressed to the board, to the effect 
that the bonds are eligible for carryforward designation and that the issuer is 
authorized under the laws of the state to issue bonds for projects of the same 
type and nature as the project which is the subject of the application. This 
opinion shall cite by constitutional or statutory reference the provision of the 
constitution or law of the state which authorizes the bonds for the project.
(c) Additional information. The board may require additional information at any 
time before granting a certificate of carryforward.
sec.190.5. Consideration of Qualified Applications by the Board.
(a) All fees required by the Act and the rules must be submitted under separate 
cover by overnight delivery to a lock box address. Each check must be 
accompanied by a fee verification form as prescribed by the board. The bank 
shall note the receipt of the check on the fee verification form and forward the 
form to the board. All checks must be received by the bank within 24 hours of 
the receipt of corresponding documents by the board. If the fee is not received 
in a timely manner, the corresponding filing will not be considered to be a 
complete filing.
(b) All other submissions required by the Act must be delivered in person to the 
board at its offices during normal business hours or sent by overnight delivery, 
certified or registered mail, postage prepaid, addressed to the board. The board 
shall note on the face of the documents the date and time that they are received 
and provide the issuer with a receipt describing the document received and the 
date and time of receipt. The board will review the application to determine if 
it is complete. The board shall return any application not in substantial 
compliance with the Act and these sections.
(c) The board shall stamp or otherwise designate the date and time on which it 
receives each qualified application. The application shall not be considered 
complete, and shall not be stamped and accepted for filing, unless and until 
each of the items required under this section has been received by the board.
(d) The board shall give its certificate of reservation approving the 
reservation requested by the issuer within five business days after the board 
receives the qualified application, to the extent that amounts in the state 
ceiling remain available for certificates of reservation.
(e)  If at any time the amount of the state ceiling or portion of the state 
ceiling reserved for qualified mortgage bonds, state voted issues, qualified 
small issue bonds, qualified residential rental project issues, or all other 
bond issues has been exhausted, applications which would otherwise qualify for a 
reservation shall be received and dated and receive reservations as provided in 
subsection (f) of this section.
(f) If at any time none of the state's ceiling remains available for 
certificates of reservation, but additional amounts become available in any 
specific category before June 1 because of cancellations or any other reason, 
those amounts shall be aggregated and reservations shall be granted from that 
category on June 1 to qualified applications in an order determined by lot 
number with respect to those applications having such numbers, and otherwise by 
date and time of receipt by the board. If any portion of state ceiling becomes 
available after June 1 and before August 25 in any specific category those 
amounts shall be aggregated and reservations shall be granted from that category 
on August 25 to qualified applications in an order determined by lot number with 
respect to those applications having such numbers, and otherwise by date and 
time of receipt by the board. The board may grant a reservation at any time on 
or after January 10 if the amount of state ceiling available in any category 
exceeds the amount of state ceiling applied for in that category.
(g) After August 25 but prior to September 1; if any portion of the state 
ceiling set aside exclusively for the housing finance division of the Texas 
Department of Housing and Community Affairs is not subject to a reservation, 
such portion prior to September 1 shall be available exclusively to issuers of 
qualified mortgage bonds in accordance with the Act, sec.3(c).
(h) A reservation that is received by an issuer of qualified mortgage bonds for 
only a portion of the amount requested in the application for reservation shall 
be considered a reservation for the calendar year regardless of the amount 
reserved, and if an application for a reservation is submitted in the following 
calendar year by such issuer, as described in the Act, sec.3(c), the category of 
priority will be determined in accordance with the Act, sec.3(c)(3) and the 
order determined by the Act,  s3(c)(4).
(i) If any change in a qualified application or in any of the items accompanying 
the application should occur prior to the date state ceiling becomes available 
to an issuer, the issue or authorized representative shall promptly notify the 
board of any such change. Upon state ceiling becoming available, an issuer or 
authorized representative, within three days upon receipt of notice from the 
board that a portion of the state ceiling will be available to the issuer, must 
confirm and certify that the information contained in the qualified application 
and all items accompanying the application are and remain accurate and in full 
force and effect, except as may be specifically set forth in any amendment to 
the qualified application (which does not result in the application failing to 
constitute a qualified application) , which amendment will constitute such 
certification. Prior to receiving a reservation, only an issuer may amend the 
application to change the amount of the state ceiling requested, but the board 
may not accept an amendment to increase the amount of the state ceiling 
requested unless at the time of the amendment seeking an increase in the amount 
of state ceiling there are no other qualified applications pending, subsequent 
in order to said application, for which state ceiling is not available. A 
reservation date will not be given by the board until the receipt of such 
certification.
(j) Upon notice by the board that a portion of the state ceiling will be 
available to the issuer for less than the requested amount, the issuer or 
authorized representative must confirm in writing its acceptance or denial of 
the amount available, within three business days. Refusal by an issuer to accept 
a certificate of reservation for less than the amount requested in a qualified 
application shall not change the chronological order in which such issuer will 
be offered a certificate of reservation. If an issuer accepts a certificate of 
reservation for less than the requested amount, the issuer shall maintain its 
current position, and will be offered the next available reservation amounts 
until the original request has been satisfied. However, the deadline 
restrictions will be calculated from the date of reservation for each 
reservation amount.
sec.190.6. Expiration Provisions.
(a) The expiration date for a certificate of reservation shall be the first 
business day which occurs on or after the 90th calendar day after the date on 
which the reservation date is given.
(b) Prior to the expiration date of the reservation, the issuer may give notice 
to the board that the reservation will not be used, and the amount will be added 
to the appropriate state ceiling.
sec.190.7. Cancellation, Withdrawal and Penalty Provisions.
(a)  If the issuer does not timely submit the bond authorization requirements 
described in sec.190.3(c) of this title (relating to Filing Requirements for 
Applications for Reservation), the issuer's reservation is canceled and during 
the 90-calendar-day period beginning on the reservation date of the canceled 
reservation:
(1) the issuer may not submit an application for a reservation for the same 
project; and
(2) the issuer is eligible for a carryforward designation for the project only 
as provided by the Act.
(b)  If the closing documents are not received within five days after the 
closing described in sec.190.3(e) of this title (relating to Filing Requirements 
for Applications for Reservation), the issue's reservation is cancelled and 
during the 120-day period beginning on the reservation date of the cancelled 
reservation:
(1) the issuer may not submit an application for a reservation for the same 
project; and
(2) the issuer is eligible for a carryforward designation for the project only 
as provided by the Act.
(c)  If an issuer withdraws an application for reservation prior to the 
expiration date, there is no penalty for such withdrawal.
(d) A certificate of allocation will not be issued until all required closing 
documents and the remaining two-thirds of the closing fee have been received by 
the board.
sec.190.8. Notices, Filings, and Submissions.
(a) Certificates of reservation and other notices and written communications 
from the board shall be deemed to have been given when duly deposited in the 
United States Mail, first class with all postage prepaid. Certificates of 
reservation may, at the request of the borrower, be picked up by hand or 
delivered by courier or other delivery service, in any case at the expense of 
the borrower or issuer.
(b)  Applications, notices, and other written communication to, and filings with 
the board should be addressed or delivered to the Bond Review Board, Sam Houston 
Building, 201 East 14th Street, Room 506, Austin, Texas 78701.
(c)  Fees should be addressed to the Bond Review Board at its lock box address.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on November 1, 1991.
TRD-9113758
Tom K. Pollard
Executive Director
Texas Bond Review Board
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-1741
       
TITLE 43. TRANSPORTATION
Part I. Texas Department of Transportation
Chapter 21. Division of Right of Way
Control of Signs Along Rural Roads
43 TAC sec.21.441, sec.21.561
(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 Transportation or in the Texas Register office, Room 245, James 
Earl Rudder Building, 1019 Brazos Street, Austin.)
The Texas Department of Transportation proposes the repeal of sec.21.441 
concerning permit for erection of off-premise sign and sec.21.561 concerning 
removal of sign. Repeal of these sections are necessary due to the 
contemporaneous proposed adoption of new sec.21.441 and sec.21.561, which 
incorporate certain of the repealed provisions in amended form along with 
updated requirements and consolidation of certain of the requirements in one 
section. The department has determined that currently there is an inequity 
between the higher permit fees for signs along rural roads than for signs along 
Interstate and Primary Highways and this could cause detrimental effects on the 
sign industry, Texas' economy and the public welfare. The department has also 
determined that the sign permit fees should be adjusted and that the procedures 
should be expanded and clarified for permit periods, renewals, transfers, and 
cancellation and that requirements for removal of signs should be consolidated 
in one section. Therefore, the department is repealing the existing sections and 
replacing them with new sections which more accurately outline the updated 
procedures and requisites.
Gary Bernethy, P.E., director of right of way, has determined that there will be 
no fiscal implications as a result of enforcing or administering the section. 
Mr. Bernethy has certified that there will be no significant impact on local 
economies or overall employment as a result of enforcing or administering the 
proposed repeal.
Mr. Bernethy also has determined that for each year of the first five years the 
section as proposed is in effect the public benefits anticipated as a result of 
enforcing the section as proposed will be a more effective and uniform 
enforcement of the display of outdoor advertising signs. There is no anticipated 
economic cost to persons who are required to comply with the proposed repeal.
Comments on the proposal may be submitted to Gary Bernethy, P.E., director of 
right of way, Division of Right of Way, Texas Department of Transportation, P.O. 
Box 5075, Austin, Texas 78763-5075.
The repeal is proposed under Texas Civil Statutes, Article 6666, which provides 
the Texas Transportation Commission with the authority to establish rules for 
the conduct of the work of the Texas Department of Transportation, and Texas 
Civil Statutes, Article 6674v-3, which provides the commission with the 
authority to adopt rules to regulate the orderly and effective display of 
outdoor advertising signs along rural roads and to prescribe permit fees in 
amounts sufficient to recover costs for enforcing that article.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 30, 1991.
TRD-9113447
Diane L. Northam
Legal Administrative Assistant
Texas Department of Transportation
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-8630
       
43 TAC sec.sec.21.441, 21.561, 21.572
The Texas Department of Transportation proposes new sec.21.441 concerning permit 
for erection of off-premise sign, sec.21.561 concerning removal of sign, and 
sec.21.572 concerning notice and appeal. New sec.21.441 replaces existing 
sec.21.441 and new sec.21.561 replaces existing sec.21.561, both of which are 
simultaneously being proposed for repeal. The department has determined that 
currently there is an inequity between the higher permit fees for signs along 
rural roads than for signs along Interstate and Primary Highways and this could 
cause detrimental effects on the sign industry, Texas' economy and the public 
welfare. The department has also determined that the sign permit fees should be 
adjusted and that the procedures should be expanded and clarified for permit 
periods, renewals, transfers, and cancellation and that requirements for removal 
of signs should be consolidated in one section.
New sec.21.441 outlines applicability, application and issuance, permit renewals 
and permit fees. The section provides for a permit fee in the amount of $96 for 
one year; a permit renewal fee of $40 per year; and a transfer fee of $25.
New sec.21.561 consolidates the requirements for removal of signs into one 
section.
New sec.21.572 establishes procedures for notice and appeal.
Gary Bernethy, P.E., director of right of way, has determined that there will be 
fiscal implications as a result of enforcing or administering these sections. 
The effect on state government for the first five-year period the section will 
be in effect will be an estimated decrease in revenue of: $2,700 for 1992; $3, 
000 for 1993; $3,400 for 1994; $3,700 for 1995; and $4,100 for 1996. Mr. 
Bernethy has certified that there will be no significant impact on local 
economies or overall employment as a result of enforcing or administering the 
proposed amended sections.
Mr. Bernethy has also determined that for each year of the first five years the 
section as proposed is in effect the public benefits anticipated as a result of 
enforcing these sections as proposed will be a more effective and uniform 
enforcement of the display of outdoor advertising signs. There will be a saving 
of $10-$154 per sign (depending on the size of the sign and whether a new permit 
or a permit renewal is required) to small businesses and individuals who are 
required to comply with the proposed amendments.
Comments on the proposal may be submitted to Gary Bernethy, P.E., director of 
right of way, Division of Right of Way, Texas Department of Transportation, P. 
O. Box 5075, Austin, Texas 78763-5075.
The Texas Department of Transportation will conduct a public hearing pursuant to 
the Administrative Procedure and Texas Register Act, Texas Civil Statutes, 
Article 6252-13a, sec.5, to receive data, comments, and views concerning the 
proposed new sections. The public hearing will be held on Wednesday, November 
20, 1991, at 9 a.m. in first floor hearing room of the Dewitt C. Greer State 
Highway Building, 11th and Brazos, Austin. Any interested person may appear and 
offer comments, either orally or in writing, however, questioning of those 
making presentations will be reserved exclusively to the presiding officer as 
may be necessary to ensure a complete record. While any person with pertinent 
comments will be granted an opportunity to present them during the course of the 
hearing, the presiding officer reserves the right to restrict testimony in terms 
of time and repetitive comment. Organizations, associations, or groups are 
encouraged to present their commonly held views, and same or similar comments, 
through a representative member where possible. Comments on the proposed text 
should include appropriate citations to sections, subsections, paragraphs, etc., 
for proper reference. Any suggestions or requests for alternative language or 
other revisions in the proposed text should be submitted in written form.
The new sections are proposed under Texas Civil Statutes, Article 6666, which 
provides the Texas Transportation Commission with the authority to establish 
rules for the conduct of the work of the Texas Department of Transportation, and 
Texas Civil Statutes, Article 7784v-3, which provides the commission with the 
authority to adopt rules to regulate the orderly and effective display of 
outdoor advertising signs along rural roads and to prescribe permit fees in 
amounts sufficient to recover costs for enforcing that article.
sec.21.441. Permit for Erection of Off-Premise Sign.
(a)  Applicability. A person shall not erect or cause to be erected an off-
premise sign, other than an exempt sign, that is visible from the main-traveled 
way of a rural road without first having obtained a permit to do so from the 
commission acting by and through the district engineer of the department 
district office serving the county in which the proposed sign is to be located.
(b) Application and issuance.
(1) A sign owner who desires to erect or maintain a sign as required in this 
section must file an application, in duplicate, in a form prescribed by the 
department, which shall include, but not be limited to:
(A) the name and mailing address of the applicant;
(B) proposed location and description of the sign;
(C)  how to find the road along which the sign is to be erected;
(D)  name and address of the site owner;
(E) indication that the site owner has consented to the erection of the sign; 
and
(F) such additional information as the department deems necessary.
(2) The application must be signed under oath by the sign owner and filed with 
the district engineer in whose district the sign is to be erected, and shall be 
accompanied by:
(A) the prescribed fee or fees; and
(B) if the proposed sign will have a height of six feet or more above the 
ground, as measured above the average level of the ground adjacent to the 
proposed structure, a certificate signed by the sign owner to the effect that 
the proposed sign will withstand wind load pressures in pounds per square foot 
as set out in the following table:
[graphic]
(3) Before approving a permit application, the district engineer shall determine 
that the proposed sign will:
(A) be located within 800 feet of at least two adjacent recognized commercial or 
industrial activities located on the same side of the roadway;
(B) be located along a roadway subject to control under these sections;
(C) meet all applicable requirements of the sections under this undesignated 
head; and
(D) not be subject to control under the Texas Litter Abatement Act.
(4) If approved, a copy of the application will be endorsed by the district 
engineer and returned to the applicant along with a permit number. Within 30 
days after it is received, the permit number shall be displayed on the sign 
structure in the following manner:
(A) legibly displayed on the edge of the sign structure nearest the roadway; and
(B) in numerals with a minimum height of two inches and minimum width of one 
inch.
(c)  Permit renewals.
(1) Subject to the terms and location stated in the permit application, a permit 
issued under this section shall be valid for a period of one year, provided the 
sign is erected and maintained in accordance with the applicable sections under 
this undesignated head.
(2) To renew a permit under this subsection, a permit holder must file with the 
district engineer a written request in a form prescribed by the department, 
together with the prescribed renewal fee; and further provided that the sign 
continues to meet all applicable requirements.
(d) Permit transfer.
(1) A permit may only be assigned with the written approval of the district 
engineer.
(2) The holder of a permit or permits who desires to transfer one or more 
permits must file with the district engineer a request in a form prescribed by 
the department, together with the prescribed transfer fee. The transferor and 
transferee will each be issued a copy of the approved permit transfer form.
(e) Permit fees.
(1) For a permit issued pursuant to this section:
(A) the original fee is $96 for each sign;
(B) the annual renewal fee is $40; and
(C) the fee is $25 for each permit transferred.
(2) A fee prescribed in this subsection is payable to the State of Texas, and is 
non-refundable.
sec.21.561. Removal of Sign.
(a) Upon written notification by a district engineer of the department, any off-
premise sign, other than an exempt sign, erected on or after September 1, 1985, 
must be removed if:
(1)  the sign was erected without a permit; or
(2) the permit is not kept renewed in accordance with the provisions in 
sec.21.441(c) of this title (relating to Permit for Erection of Off-Premise 
Sign).
(b) When a commercial or industrial activity ceases and a sign is no longer 
located within 800 feet of at least two adjacent recognized commercial or 
industrial activities located on the same side of the roadway, the sign is no 
longer conforming in accordance with sec.21.451(g) of this title (relating to 
Spacing Requirements). When this situation has existed for a period of at least 
six months, the sign shall be removed within the following six months.
(c) The owner shall remove the sign at the owner's expense.
sec.21.572. Notice and Appeal. Upon determination that a permit or registration 
should be cancelled, the director of right of way shall mail a notice of 
cancellation to the last known address of the holder of the permit or 
registration by certified mail.
(1) The notice shall clearly state:
(A) the reasons for the cancellation;
(B) the effective date of the cancellation; and
(C) the right of the holder of the permit or registration to request an 
administrative hearing on the question of the cancellation.
(2) A request for an administrative hearing under this section must be made in 
writing to the director of right of way within 1O days of the receipt of the 
notice of cancellation.
(3) If timely requested, an administrative hearing shall be conducted in 
accordance with sec.sec.1.21-1.63 of this title (relating to Contested Case 
Procedure), and shall serve to abate the cancellation unless and until that 
cancellation is affirmed by order of the commission.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 30, 1991.
TRD-9113448
Diane L. Northam
Legal Administrative Assistant
Texas Department of Transportation
Earliest possible date of adoption: December 9, 1991
For further information, please call: (512) 463-8630