Emergency Sections
An agency may adopt a new or amended section or repeal an existing section on an 
emergency basis if it determines that such action is necessary for the public 
health, safety, or welfare of this state. The section may become effective 
immediately upon filing with the Texas Register, or on a stated date less than 
20 days after filing, for no more than 120 days. The emergency action is 
renewable once for no more than 60 days.
Symbology in amended emergency sections. New language added to an existing 
section is indicated by the use of bold text. [Brackets] indicate deletion of 
existing material within a section.
TITLE 1. ADMINISTRATION
Part III. Office of the Attorney General
Chapter 59. Collections
1 TAC sec.59.2
The Office of the Attorney General adopts on an emergency basis sec.59.2, 
establishing uniform guidelines concerning the process by which state agencies 
collect delinquent obligations and refer these obligations to the Attorney 
General for further collection efforts. The new section is adopted on an 
emergency basis in order to comply with Texas Civil Statutes, Article 6252-5e(2) 
(c), requiring these guidelines and procedures to be adopted before June 1, 
1992.
The section is intended to provide general guidelines for the collection of 
delinquent accounts owed to state agencies, to assist agencies with in-house 
collection personnel to develop collection strategies, and to foster the 
referral of collection matters to the Attorney General where referral procedures 
do not currently exist. The section is not intended to replace existing 
procedures with certain state agencies and the Attorney General where collection 
procedures already have a high degree of formality and sophistication, 
especially where these relationships are premised on existing statutory 
mandates, such as the certification of delinquent tax accounts for collection. 
The Attorney General recognizes that delinquent obligations owed to agencies 
differ by a wide variety of accounts, debt type, amount and number of individual 
accounts, that collection of certain debts are facilitated by statutory and 
legal presumptions, and that many agencies have in-house attorneys and staff to 
handle specific types of legal proceedings. Agencies may apply to the Attorney 
General for recognition of a variance from the specific requirements imposed by 
this section, and for authorization to use in-house counsel in accordance with 
subsection (b)(1)(A) herein. Finally, the Attorney General recognizes that these 
guidelines are, by definition, general in nature, and that modifications with 
particular agencies may be appropriate.
The rule also seeks to quantify and evaluate the type, degree, and effectiveness 
of outside counsel representation in state agency collection matters, to the 
extent it exists, to enable the Attorney General to determine whether to 
undertake representation of the agency in the collection matter as authorized by 
Texas Civil Statutes, Article 6252-5e(4).
Any comment on the rule should be addressed to Ronald R. Del Vento, Assistant 
Attorney General, Chief, Collections Division, Office of the Attorney General, 
P. O. Box 12548, Austin, Texas 78711-2548.
The new section is adopted on an emergency basis under Texas Civil Statutes, 
Article 6252-5e, which was added to Title 110A, Revised Statutes, by Acts, 72nd 
Legislature, 1st Called Session, Chapter 4, sec.6.01. In addition, House Bill 
Number 1, 72nd Legislature, 1st Called Session, Article 5, sec.74, provides that 
the Office of the Attorney General may develop a uniform reporting procedure for 
state agencies and institutions to report uncollected debts and judgments to the 
Attorney General's Office for further collection efforts.
sec.59.2. Collection Process: Uniform Guidelines and Referral of Delinquent 
Collections.
(a) Definitions. The following words and terms, when used in this section, shall 
have the following meanings, unless the context clearly indicates otherwise.
(1) Attorney General-The Office of the Attorney General of Texas, acting through 
the Collections Division of the agency.
(2) Debtor-Any person or entity liable or potentially liable for an obligation 
owed to a state agency or against whom a claim or demand for payment has been 
made.
(3) Delinquent-Payment is past due by law or by customary business practice, and 
all conditions precedent to payment have occurred or been performed.
(4) Make demand-To deliver or cause to be delivered by United States Mail, first 
class, a writing setting forth the nature and amount of the obligation owed to 
the agency. A writing making demand is a "demand letter".
(5) Obligation-A debt, judgment, claim, account, fee, fine, tax, penalty, 
interest, loan, charge, or grant.
(6)  Security-Any right to have property owned by an entity with an obligation 
to a state agency sold or forfeited in satisfaction of the obligation; and any 
instrument granting a cause of action in favor of the State of Texas and/or the 
agency against another entity and/or that entity's property, such as a bond, 
letter of credit, or other collateral that has been pledged to the agency to 
secure an obligation.
(7) State agency-Any agency, board, commission, institution, or other unit of 
state government.
(b) Uniform guidelines for state agencies in collecting delinquent obligations.
(1) A state agency shall adopt procedures to establish and determine the 
liability of each person responsible for the obligation, whether that liability 
can be established by statutory or common law. Agency records shall contain and 
reflect the identity of all persons liable on the obligation or any part 
thereof. All agency collection procedures shall apply to every debtor, subject 
to reasonable tolerances established by the agency. (See, paragraph 8 of this 
subsection).
(2) A state agency shall adopt procedures to ensure that agency records reflect 
the correct physical address of the debtor's place of business, and, where 
applicable, the debtor's residence. Where a fiduciary or trust relationship 
exists between the agency (or the state) as principal and the debtor as trustee, 
an accurate physical address shall be maintained. A post office box address 
should not be used. Agency records may reflect a post office box where it is 
impractical to obtain a physical address, or where the post office box address 
is in addition to a correct physical address maintained on the Office of the 
agency's books and records.
(3) All demand letters should be mailed in an envelope bearing the notation 
"address correction requested" in conformity with 39 Code of Federal 
Regulations, sec.265(d). If an address correction is provided by the United 
States Postal Service, the demand letter should be re-sent to that address prior 
to the referral procedures described herein. Demand should be made upon every 
debtor prior to referral of the account to the Attorney General. The final 
demand letter shall include a notation that a copy is being sent to the Attorney 
General.
(4) Where state law gives the agency the right to record a lien securing the 
obligation, the agency shall cause to be filed a lien in the appropriate records 
of the county where the debtor's principal place of business, or, where 
appropriate, the debtor's residence, is located. The lien shall be filed as soon 
as the obligation becomes delinquent or as soon as is practicable. After 
referral, any lien securing the indebtedness may not be released, except on full 
payment of the obligation, without the approval of the attorney representing the 
agency in the matter.
(5) Where practicable, agencies shall maintain individual collection histories 
of each account in order to document attempted contacts with the debtor, the 
substance of communications with the debtor, efforts to locate the debtor and 
his assets, and other information pertinent to collection of the delinquent 
account.
(6) Prior to referral of the obligation to the Attorney General, the agency 
shall:
(A) verify the debtor's address and telephone number;
(B) transmit no more than two demand letters to the debtor at the debtor's 
verified address. The first demand letter should be sent no later than 30 days 
after the obligation becomes delinquent. The second demand letter should be sent 
no sooner than 30 days, but not more than 60 days, after the first demand 
letter. Where agency procedures, statutory mandates, or the requirements of this 
section indicate that a lawsuit on the account may be filed by the Attorney 
General, the demand letters shall so indicate;
(C)  verify that the obligation is not uncollectible. Agencies shall adopt 
procedures to ensure that referred obligations are not uncollectible. By way of 
example, the following illustrations apply.
(i) Bankruptcy. Agencies should prepare and timely file a proof of claim in the 
bankruptcy case of each debtor, subject to reasonable tolerances adopted by the 
agency. Copies of all such proof of claims filed shall be sent to the Attorney 
General absent the granting of a variance. Agencies shall maintain records of 
notices of bankruptcy filings, dismissals and discharge orders received from the 
United States bankruptcy courts pertaining to debtors sufficient to enable the 
agency to ascertain whether the collection of the agency's claim is subject to 
the automatic stay provisions of the bankruptcy code or whether the debt has 
been discharged. Agencies may seek the assistance of the Attorney General in 
bankruptcy collection matters where necessary, including the filing of a notice 
of appearance and preparation of a proof of claim.
(ii) Limitations. If the obligation is subject to an applicable limitations 
provision that would prevent collection as a matter of law, the obligation 
should not be referred unless circumstances indicate that limitations has been 
tolled or is otherwise inapplicable.
(iii) Corporations. If a corporation has been dissolved, is in liquidation under 
Chapter 7 of the United States Bankruptcy Code, has forfeited its corporate 
privileges or charter, or had its Certificate of Authority revoked, the 
obligation should not be referred unless circumstances indicate that the account 
is nonetheless collectible.
(iv)  Out-of-state debtors. If the debtor is located out-of-state, or outside 
the United States, the matter should not be referred unless a determination is 
made that the domestication of a Texas judgment in the foreign forum would more 
likely than not result in collection of the obligation, or that the expenditure 
of agency funds to retain foreign counsel to domesticate the judgment and 
proceed with collection attempts is justified.
(v) Deceased debtors. If the debtor is deceased, agencies should file a claim in 
each probate proceeding administering the decedent's estate. If such probate 
proceeding has concluded and there are no remaining assets of the decedent 
available for distribution, the delinquent obligation should be classified as 
uncollectible and not be referred. In cases where a probate administration is 
pending, or where no administration has been opened, all referred obligations 
should include an explanation of any circumstances indicating that the decedent 
has assets available to apply toward satisfaction of the obligation.
(vi)  Indicia of inability to pay. Where circumstances demonstrate a permanent 
inability of a debtor to pay or make payments toward the obligation, the 
obligations should not be referred.
(7) Not later the 3Oth day after the date a state agency determines that normal 
agency collection procedures for an obligation owed to the agency have failed, 
the agency shall report the uncollected and delinquent obligation to the 
Attorney General for further collection efforts as hereinafter provided.
(8) Agencies shall adopt reasonable tolerances, subject to review by the 
Attorney General, below which an obligation shall not be referred. Factors to be 
considered in establishing tolerances include the size of the debt; the 
existence of any security; the likelihood of collection through passive means 
such as the filing of a lien where applicable; expense to the agency and to the 
Attorney General in attempting to collect the obligation; and the availability 
of resources both within the agency and within the Office of the Attorney 
General to devote to the collection of the obligation.
(9) Warrant hold. An agency should utilize the "warrant hold" procedures of the 
Comptroller of Public Accounts authorized by the Texas Government Code, 
sec.403.055 to ensure that no treasury warrants are issued to debtors until the 
debt is paid.
(c) Referral to attorneys.
(1) Suit on the obligation by in-house attorneys.
(A)  Agencies seeking to use in-house attorneys to collect delinquent 
obligations through court proceedings must submit a written request to the 
Attorney General. Upon the written approval of the Attorney General, a state 
agency may bring suit upon a delinquent obligation through an attorney serving 
as a full-time employee of the agency. Where circumstances make it impractical 
to secure Attorney General approval for every delinquent obligation upon which a 
lawsuit is to be filed, a state agency may apply to the Attorney General for an 
authorization to bring suit on particular types of obligations through attorneys 
employed full-time by the agency. Such authorization, if given, must be renewed 
at the beginning of each fiscal year. A state agency shall comply with reporting 
requirements that the Attorney General may adopt pursuant to Texas Civil 
Statutes, Article 6252-5e.
(B) After an obligation is referred to agency attorneys employed as in-house 
counsel, the obligation shall be reduced to judgment against all entities 
legally responsible for the obligation where: the lawsuit and judgment will make 
collection of the obligation more likely; and the expenditure of agency 
resources in recovering judgment on the obligation is justified.
(C) Where authorized by law, the agency shall plead for and recover attorney's 
fees, investigative costs, and court costs in addition to the obligation.
(D) Every judgment taken on a delinquent obligation shall be abstracted and 
recorded by the agency in every county where the debtor: owns real property; 
operates an active business; is likely to inherit real property; owns any 
mineral interest; or has maintained a residence for more than one year.
(2) Referral to the Attorney General.
(A) Bulk accounts. Agencies are encouraged to explore the exchange of accounts 
with the Attorney General by computer tape or other electronic data transfer and 
to discuss any variances as may be appropriate. The agency and the Attorney 
General may agree upon an exchange of certain minimum account information 
necessary for collection efforts by the Attorney General.
(B) Individual accounts. Agencies may refer individual accounts to the Attorney 
General after the procedures set forth in Subsection (a)(6)-(8) of this section. 
Individual accounts referred to the Attorney General should be accompanied by 
the following:
(i) the copies of all correspondence between the agency and the debtor;
(ii)  a log sheet (see, subsection (a)(5) of this section) documenting all 
attempted contacts with the debtor and the result of such attempts;
(iii)  a record of all payments made by the debtor and, where practicable, 
copies of all checks tendered as payment;
(iv) any information pertaining to the debtor's residence and his assets; and
(v) copies of any permit application, security, or instrument giving rise to the 
obligation.
(C) Bonds/security. Delinquent accounts upon which a bond or other security is 
held shall be referred to the Attorney General no later than 60 days after 
becoming delinquent. All such accounts where the principal has filed for relief 
under federal bankruptcy laws shall be referred immediately, since collection of 
the security may obviate the need to file a claim or to appear in the bankruptcy 
case.
(D) The Attorney General may decide that a particular obligation or class of 
obligations may be assigned after referral to the appropriate division within 
the Office of the Attorney General.
(3)  Referral to collection firms or private attorneys.
(A) Prior approval of attorney general. No agency may contract with, retain, or 
employ any person other than a full time employee of the agency to collect a 
delinquent obligation without prior written approval of the Attorney General. 
Any existing arrangements must receive the written approval of the Attorney 
General to be renewed or extended in any fashion.
(i) Approval of contract with private firm or attorney. Prior to contracting 
with, retaining, or employing a person other than a full-time employee of the 
agency to collect a delinquent obligation, an agency must submit a proposal to 
the Attorney General requesting the Attorney General to collect the 
obligation(s). Any agency contracting with any person other than a full-time 
employee of the agency for the collection of a delinquent obligation must submit 
the proposed contract to the Attorney General for written approval. The proposal 
must disclose any fee that the agency proposes to pay the private collection 
firm or attorney. The Attorney General may elect to undertake representation of 
the agency on the same or similar terms as contained in the proposed contract. 
If the Attorney General declines or is unable to perform the services requested, 
the Attorney General may approve the contract. If the Attorney General decides 
that the agency has not complied with this subsection, the Attorney General may:
(I) decline to approve the contract; or
(II) require the agency to submit or resubmit a proposal to the Attorney General 
for collection of the obligation in accordance with this subsection.
(ii) If the Attorney General fails to act as set forth in subsection (a) of the 
section within 60 days of receipt of the proposed contract or receipt of 
additional information requested, the Attorney General is deemed to have 
approved the contract in accordance with this rule.
(B)  Requirements of proposed contracts with private persons presented for 
Attorney General approval. All contracts for collection of delinquent 
obligations must contain or be supported by a proposal containing the following:
(i) a description of the obligations to be collected sufficient to enable the 
Attorney General to determine what measures are necessary to attempt to collect 
the obligation(s);
(ii) explicit terms of the basis of any fee or payment for the collection of the 
obligation(s);
(iii) a description of the individual accounts to be collected in the following 
respects:
(I) the total number of delinquent accounts;
(II) the dollar range;
(III) the total dollar amount;
(IV) a summary of the collection efforts previously made by the agency; and
(V) the legal basis of the delinquent obligations to be collected.
Issued in Austin, Texas, on May 19, 1992.
TRD-9206929
Will Pryor
First Assistant Attorney General
Office of the Attorney General
Effective date: May 20, 1992
Expiration date: September 17, 1992
For further information, please call: (512) 463-2040
       
TITLE 22. EXAMINING BOARDS
Part XXII. Texas State Board of Public Accountancy
Chapter 519. Practice and Procedure
Practice and Procedure
22 TAC sec.519.18
The Texas State Board of Public Accountancy adopts on an emergency basis an 
amendment to sec.519.18, concerning rules of practice and procedure. This 
amendment is necessary in order to enable the board to effectively prosecute 
major cases with appropriations for fiscal year 1992.
The amendment is adopted on an emergency basis under Texas Civil Statutes, 
Article 41a-1 sec.6(a), which provide the Texas State Board of Public 
Accountancy with the authority to promulgate rules to effectuate the Act.
sec.519.18. Place and Nature of Hearings. All hearings conducted in any 
proceedings shall be open to the public except for the deliberations between 
hearing panel members to develop the hearing panel's recommendation(s) and all 
testimony shall be made under oath. <nl>All hearings shall be held in Austin 
unless for good and sufficient cause the executive director shall designate 
another place of hearing in the interest of the public.
Issued in Austin, Texas, on May 20, 1992.
TRD-9206976
William Treacy
Executive Director
Texas State Board of Public Accountancy
Effective date: May 20, 1992
Expiration date: September 17, 1992
For further information, please call: (512) 450-7066
       
TITLE 25. HEALTH SERVICES
Part I. Texas Department of Health
Chapter 133. Hospital Licensing
Standards
25 TAC sec.133.21
The Texas Department of Health (department) adopts on an emergency basis an 
amendment to sec.133.21, concerning hospital licensing standards (standards) 
which the section adopts by reference. The amendment modifies Chapter 12 in the 
standards concerning special licensing standards governing the provisions of 
mental health services in hospitals. Specifically, the amendment changes the 
definition of "hospital" in Section 12-3.7 in Chapter 12 by including special 
hospitals. The Texas Hospital Licensing Law, Health and Safety Code, Chapter 
241, allows for the licensing of both general and special hospitals. Because 
both general and special hospitals may have identifiable parts of the hospital 
for the provision of mental health services and chemical dependency services, 
the department believes this amendment should apply to special hospitals which 
provide mental health services. The amendment also is being proposed for 
permanent adoption in this issue of the Texas Register.
The amendment is adopted on an emergency basis in order to address abuses 
recently identified in widespread public allegations of state law and patient 
rights in private psychiatric hospitals. The activities constitute an imminent 
threat to public health and safety. Accordingly, it is imperative that the 
department adopt the amendment on an emergency basis in order to address these 
activities as soon as possible.
The amendment is adopted on an emergency basis under the Health and Safety Code, 
sec.241.027, which provides the Texas Board of Health (board) with authority to 
adopt rules to establish and enforce minimum standards for the licensing of 
hospitals; sec.12.001, which provides the board with authority to adopt rules 
for the performance of every duty imposed by law upon the board, the department, 
and the commissioner of health; and Texas Civil Statutes, Article 6252-13a, 
sec.5, which provide the board with authority to adopt rules on an emergency 
basis.
sec.133.21. Adoption by Reference.
(a) The Texas Department of Health adopts by reference the rules contained in 
the department publication effective September 1, 1985, entitled "Hospital 
Licensing Standards," as amended through June 1992.
(b) (No change.)
Issued in Austin, Texas, on May 20, 1992.
TRD-9206952
Robert A. MacLean, M.D.
Deputy Commissioner
Texas Department of Health
Effective date: June 9, 1992
Expiration date: November 7, 1992
For further information, please call: (512) 834-6650