Adopted Sections 
 An agency may take final action on a section 30 days after a proposal has been 
published in the Texas Register. The section becomes effective 20 days after the 
agency files the correct document with the Texas Register, unless a later date 
is specified or unless a federal statute or regulation requires implementation 
of the action on shorter notice. 
 If an agency adopts the section without any changes to the proposed text, only 
the preamble of the notice and statement of legal authority will be published. 
If an agency adopts the section with changes to the proposed text, the proposal 
will be republished with the changes. 
 
   
  TITLE 1. ADMINISTRATION 
 Part XII. Advisory Commission on State Emergency Communications 
  Chapter 251. Regional Plans Standards 
  
  1 TAC sec.251.2 
 
  The Advisory Commission on State Emergency Communications adopts the repeal of 
sec.251.2, without changes to the proposed text as published in the August 7, 
1992, issue of the Texas Register (17 TexReg 5495). 
 The repeal will benefit the councils of governments and commission staff 
through simplified procedures. 
 The repeal eliminates a costly and lengthy amendment approval process. 
 No comments were received regarding adoption of the repeal. 
 The repeal is adopted under the Health and Safety Code, Chapter 771, which 
provides the Advisory Commission on State Emergency Communications with the 
authority to promulgate rules to accomplish the purpose of the article. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 14, 1992. 
 TRD-9213902 
  Mary A. Boyd 
 Executive Director 
 Advisory Commission on State Emergency Communications 
    Effective date: November 4, 1992 
 Proposal publication date: September 7, 1992 
 For further information, please call: (512) 327-1911 
         
     
  The Advisory Commission on State Emergency Communications adopts new 
sec.251.2, without changes to the proposed text as published in the August 7, 
1992, issue of the Texas Register (17 TexReg 5495). 
 Each amendment to a 9-1-1 regional plan has required staff and committee 
consideration, and then commission action. The process has been lengthy and 
costly in terms of time and travel costs each time amendment approval was 
necessary. The proposed guidelines help clarify and streamline the amendment 
process, delegating some functions and actions to the COGs and the commission 
staff. 
 It will allow a council of government more latitude to make 9-1-1 
implementation decisions in its region and allow for enhancements where 
technically and financially feasible. This also clarifies that the equalization 
surcharge fund may be used to implement both regional and district plans. The 
commission will continue to examine the financial impact on the 9-1-1 funds. 
 No comments were received regarding adoption of the new section. 
 The new section is adopted under the Health and Safety Code, sec.sec.771.055, 
771.056, 771.057, and 771.072, which provides the Advisory Commission on State 
Emergency Communications with the authority to develop and amend a regional plan 
for the establishment and operation of 9-1-1 service in accordance with 
commission standards and procedures. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 14, 1992. 
 TRD-9213899 
  Mary A. Boyd 
 Executive Director 
 Advisory Commission on State Emergency Communications 
    Effective date: November 4, 1992 
 Proposal publication date: September 7, 1992 
 For further information, please call: (512) 327-1911 
         
       
  1 TAC sec.251.3 
 
  The Advisory Commission on State Emergency Communications adopts new 
sec.251.3, with changes to the proposed text as published in the August 11, 
1992, issue of the Texas Register (17 TexReg 5613). 
 The public will benefit where counties utilize funds toward the completion of 
rural address assignments, which allow for the automatic location identifier 
(ALI) feature to display the location of 9-1-1 callers, This will enable 
improved effectiveness of 9-1-1 call delivery. 
 The section will serve as a guide for the distribution of state addressing 
funds to local governments for the purpose of establishing addresses, essential 
to E9-1-1 systems utilizing ALI. 
 Comments were received from the Houston-Galveston Area Council, asking that the 
procedures for requesting addressing pool funds and the procedures for applying 
for service fees for addressing be presented separately. 
 The names of a group making comments for the section is as follows: Houston-
Galveston Area Council. 
 The new section is adopted under the Health and Safety Code, sec.sec.771.055, 
771.056, 771.057, and 771.072, which provides the Advisory Commission on State 
Emergency Communications with the authority to develop and amend a regional plan 
for the establishment and operation of 9-1-1 service throughout a 9-1-1 region 
that meets commission standards and procedures. 
 
 
  sec.251.3. Guidelines for Addressing Funds. 
 
  (a) Policy. The Advisory Commission on State Emergency Communications adopted 
a policy on March 11, 1992, regarding rural addressing and the use of state 
addressing funds. This information provides a guide whereby state addressing 
funds are distributed to local governments for the purpose of establishing 
addresses. Street addresses are essential to E9-1-1 systems utilizing the 
automatic location identifier feature which displays locations of 9-1-1 callers. 
   
  (b) Definitions. The following words and terms, when used in this section, 
shall have the following meanings, unless the context clearly indicates 
otherwise. 
 
  (1) Addressing Activities-Work associated with the initial inventory of a 
county for the purposes of rural addressing, conversion of box and route. 
numbers to street addresses, correction of existing address errors, notification 
to residents of new addresses, resolution of address assignment problems, and 
installation of new street signs. 
   
  (2) Addressing pool funds-Funds directed to statewide addressing use 
including, but not limited to, federal or state grants, contributions, 
donations, and telephone rate case distributions but excluding service fee, 
either restricted or unrestricted in use. 
   
  (3)  Cost-estimate worksheet-A form which is used to list and calculate the 
costs and funds needed for addressing activities in a county. 
   
  (4)  Emergency communications district- 
 
  (A) a public agency or group of public agencies acting jointly that provided 
9-1-1 service before September 1, 1987, or that had voted or contracted before 
that date to provide that service; or 
   
  (B) a district created under the Health and Safety Code, Chapter 772, 
Subchapter B, C, or D. 
     
  (5) Local Funds-Funds provided by local government from general revenue, in-
kind services, and other local sources for addressing. 
   
  (6) Regional Plan-Each regional planning commission shall develop and plan for 
the establishment and operation of 9-1-1 service throughout the region that the 
regional planning commission serves. The service must meet the standards 
established by the advisory commission. 
   
  (7) Regional planning commission-A commission established under the Local 
Government Code, Chapter 391, also referred to as a regional council of 
governments (COG). 
   
  (8) Restricted funds-Addressing pool funds for which the contributing agency 
has required certain conditions to be met in distributing funds for addressing. 
   
  (9) Road mile count-County road miles based upon most current data from the 
Texas Department of Transportation. 
   
  (10) Service fee-Except as otherwise provided by the Health and Safety Code 
771, Subchapter D, the advisory commission may impose a 9-1-1 emergency service 
fee on each local exchange access line or equivalent local exchange access line, 
including lines of customers in an area served by an emergency communication 
district participating in the applicable regional plan. 
   
  (11) Unaddressed county-A county in Texas which has not completely notified 
residents of new addresses under a county addressing process. 
   
  (12) Unaddressed housing count-The calculated number of housing units in a 
county based upon rural population data from the most recent United States 
Census reports. 
   
  (13) Unaddressed land parcel count-The estimated number of county land parcels 
which have no address as calculated by counties to be addressed. 
   
  (14) Unrestricted funds-Addressing pool funds for which the contributing 
agency does not require conditions to be met in distributing funds for 
addressing. 
     
  (c) Policy and procedures. The commission authorizes and allocates addressing 
funds to include addressing pool funds and service fees. Addressing pool funds 
may include funds not actually provided ACSEC, but placed under its control by a 
third party specifically for the purposes of this program. 
 
  (1) Any unaddressed county implementing or operating 9-1-1 service, or a COG 
or emergency communication district applying on behalf of such a county are 
considered eligible. 
   
  (2) Unrestricted addressing pool funds will be allocated by adding all 
counties' numbers of road mileage, unaddressed housing units, and unaddressed 
land parcels. The total of those numbers will be compared against each county's 
individual total and a proportionate share of funds will be allocated to each 
county. The commission may establish a minimum amount of addressing pool funds 
to be allocated to each eligible county in order to ensure adequate minimum 
funding to support addressing activities. 
   
  (3) Restricted addressing pool funds will be allocated in accordance with 
those restrictions placed upon their distribution by the contributing agency. 
   
  (4) As available, restricted addressing pool funds will be allocated first to 
eligible applicants, followed by unrestricted addressing pool funds. 
   
  (5) Service fees may be allocated to counties after taking into account those 
costs associated with 9-1-1 monthly recurring expenses, ALI upgrade, and 
ancillary equipment requirements. 
   
  (6) The addressing pool funds and service fees may be used only for costs 
associated with addressing activities. 
   
  (7) A county must provide $1.00 of local funds for every $3.00 (25% match) 
allocated or authorized under this fund. 
   
  (8) Under no circumstances will funds be allocated or approved under this 
program that exceed total net funds needed as calculated by the cost- estimate 
worksheet. 
   
  (9) In accordance with this policy, counties or emergency communications 
districts which have already started addressing activities and incurred costs 
may request reimbursement of those documented addressing expenditures, if costs 
were incurred since January 1, 1991. The commission may consider reimbursement 
of eligible expenses prior to that date on a case-by-case basis. 
   
  (10) Funds under this program must be requested by a deadline to be 
established by the commission. Funds may be awarded by the commission following 
this established date on a cass-by-case basis. 
     
  (d)  Requesting addressing pool funds and service fees. A regional plan 
amendment from a COG or a request from an emergency communications district is 
required as a means of requesting funds under this program, as described 
following. 
 
  (1) A regional plan amendment or request for funds from COG must contain the 
following: 
 
  (A) an addressing project narrative; 
   
  (B)  a completed cost-estimate worksheet including identification of the 
required local match; 
   
  (C) an approved projected COG financial cashflow if service fees are 
requested; 
   
  (D) if necessary, a request to amend the COG administrative budget for 
additional staff, whether through hiring or through personnel contract services. 
     
  (2) A request for funds from emergency communications districts must contain 
the following information: 
 
  (A) an addressing project narrative; and 
   
  (B) a completed cost-estimate worksheet including identification of the 
required local match. 
     
  (3) Regional plan amendments and requests for funds under this program should 
be submitted by the COG or the emergency communications district to the 
commission five weeks prior to the scheduled commission meeting at which the 
amendment or request will be considered. 
     
  (e) Reporting. A performance and financial report is to be submitted to the 
commission in accordance with established commission policy. Where a COG or an 
emergency communication district is the primary contractor but a county is 
providing services under this program, said reports shall be provided to the 
commission prior to COG or emergency communications district reimbursement of 
related county expenses. Monthly financial reports are to be provided utilizing 
Form 269a, under the contractual column. Counties, emergency communications 
districts, and COGs are required to follow local government statutes as they 
apply to competitive proposals for purchase of services and equipment. 
   
  (f) Cost estimate worksheet. The cost estimate worksheet is adopted by 
reference, and can be obtained from the Advisory Commission on State Emergency 
Communications, 1101 Capital of Texas Highway, South, Suite B-100, Austin, Texas 
78746, (512) 327-1911. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 14, 1992. 
 TRD-9213900 
  Mary A. Boyd 
 Executive Director 
 Advisory Commission on State Emergency Communications 
    Effective date: November 4, 1992 
 Proposal publication date: August 11, 1992 
 For further information, please call: (512) 327-1911 
         
             Chapter 252. Administration 
  
  1 TAC sec.252.3 
 
  The Advisory Commission on State Emergency Communications adopts new 
sec.252.3, without changes to the proposed text as published in the August 7, 
1992, issue of the Texas Register (17 TexReg 5497). 
 The commission will be guided by budget information requested to evaluate 
councils of governments' application for funds to adequately administer the 9-1-
1 systems in their regions, some of which are still in early stages of 
implementation. 
 It will establish the submission and review process of proposed administrative 
budgets as identified by the councils of governments. The section will allow for 
evaluation and review of budgetary needs to conduct 9-1-1 initiatives. 
 No comments were received regarding adoption of the new section. 
 The new section is adopted under the Health and Safety Code, Chapter 771, 
Subchapters C and D, which provides the Advisory Commission on State Emergency 
Communications with the authority to provide financial assistance as appropriate 
to operate 9-1-1 program initiatives in accordance with commission standards and 
procedures. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 14, 1992. 
 TRD-9213899 
  Mary A. Boyd 
 Executive Director 
 Advisory Commission on State Emergency Communications 
    Effective date: November 4, 1992 
 Proposal publication date: September 7, 1992 
 For further information, please call: (512) 327-1911 
         
             
  TITLE 7. BANKING AND SECURITIES 
 Part V. Office of Consumer Credit Commissioner 
  Chapter 85. Rules of Operation for Pawnshops 
  
  7 TAC sec.85.1, sec.85.2 
 
  The Office of Consumer of Credit Commissioner of Texas adopts new sec.85.1 and 
sec.85.2, concerning rules of operation for pawnshops. Section 85.2 is adopted 
with changes to the proposed text published in the September 4, 1992, issue of 
the Texas Register (17 TexReg 6079). Section 85.1 is adopted without changes and 
will not be republished. The following subsections of sec.85.2 were changed: 
85.2(a)(1); 85.2(a)(2)(A); 85.2(a)(2)(B); 85.2(a)(2)(C); 85.2(b)(1)(A); 
85.2(b)(1)(C); 85.2(b)(1)(D)(ii); 85.2(b)(1)(F); 85.2(b)(1)(F) (i); 
85.2(b)(1)(F)(iii); 85.2(b)(1)(F)(v); 85.2(b)(2); 85.2(c)(3); 85.2(c)(4); 
85.2(c)(6); 85.2(c)(7); 85.2(c)(10); 85.2(d)(1); 85.2(d)(2); 85.2(d)(4); 85. 
2(f)(1)(A); 85.2(f)(1)(B)(i); 85.2(f)(1)(B)(ii); 85.2(h)(1); 85.2(h)(2); 85. 
2(i). The following subsections of  sec.85.2 were not changed: 85.2(a)(2)(D); 
85. 2(a)(3); 85.2(a)(4); 85.2(b)(1)(B); 85.2(b)(1)(C); 85.2(b)(1)(D)(i); 
85.2(b)(1) (D)(iii); 85.2(b)(1)(D)(iv); 85.2(b)(1)(E); 85.2(b)(1)(F)(ii); 
85.2(b)(1)(F)(iv) ; 85.2(b)(3); 85.2(b)(4); 85.2(b)(5); 85.2(c)(1); 85.2(c)(2); 
85.2(c)(5); 85. 2(c)(8); 85.2(c)(9); 85.2(c)(11); 85.2(d)(3); 85.2(f)(2); 
85.2(f)(3); 85.2(g); 85.2(h)(3). 
 Adoption of the new rules are necessary in order to properly regulate the 
operation of pawnshops subject to licensure under the provisions of the Texas 
Pawnshop Act. Based on comments made at the public hearing on October 1, 1992, 
and written comments submitted during the public comment period Al Endsley, 
Commissioner, Office of Consumer Credit Commissioner, is of the opinion that the 
consumer, the industry, and the public in general would be better served by the 
changes made as a result of the comments and suggestions received during the 
comment period. Further justification for the rules as adopted is set out in the 
following paragraphs, which detail the reasons for and against comments and 
those statements should be considered as part of the rules' reasoned 
justification. 
 The rules define terms commonly used by pawnbrokers; set standards, duties, and 
responsibilities of pawnbrokers involving the location and licensing of 
pawnshops, including the license qualifications for pawnshops and pawnbrokers, 
the application requirements, the procedures for processing of applications, 
relocation of pawnshops, and the expiration and renewal of pawnshop licenses; 
set fees; provide a comprehensive set of rules supplementing the provisions of 
Texas Civil Statutes, Article 5069-Chapter 51; and provide guidance to 
pawnbrokers concerning all matters pertaining to the licensing of pawnshops. 
 The summary of comments received and reasons why the agency disagrees with the 
comments are as follows. 
 
 
  "Bank Deposits" definition. Expansion of definition requested by four 
individuals. "Bank deposits" is a term specifically used in the Pawnshop Act in 
the definition of net assets. The proposed definition expands "bank" to include 
savings and loan associations, credit unions, and other federal insured 
institutions typically viewed as bank type institutions. The commissioner does 
not believe that the term should be expanded beyond this basis because of the 
statutory constraints. 
 
   
  "Merchandise Inventory" definition. The San Antonio Pawnbroker's Association 
(SAPA) requested the definition be struck and an individual requested a 
broadening of the definition. It is necessary for the commissioner to define 
merchandise inventory, since it is a component of the net assets available for 
use in the business as defined in the Pawnshop Act. Inventory not for use in the 
pawnshop does not fit the statutory description of inventory and does not fit 
the statutory definition of inventory in the Business and Commerce Code. The 
commissioner believes that this definition is consistent and appropriate and 
complies with statutory constraints. 
 
   
  "Community" definition. Inclusion of the definition was opposed by SAPA. Three 
individuals commented that the definition needed expansion and clarification and 
one commented that use of the word "any" suggested the definition was applicable 
to all applications. Cash America recommended a modification of the definition. 
The commissioner disagrees with the individuals. Recognizing that the language 
requiring a finding of public need and probability of profitability was taken 
from Texas Civil Statutes, Article 852a (the Texas Savings and Loan Act), the 
commissioner has looked to Article 852a and appellate court decisions for 
guidance in establishing the proposed definition which was adopted as a matter 
of policy at the inception of hearings on public need and probability of 
profitability for pawnshops. The commissioner does not believe that the 
definition language functions to make "community" applicable to all applications 
but one may discern those applications to which the term applies by reference to 
the Act and the substantive rules. The commissioner disagrees with Cash America 
as he believes that modification of the definition is not needed. The 
commissioner finds that the word "resides" as used in the proposed definition is 
not limited in its definition and application to a place of residence. The word 
signifies a presence and encompasses working and traveling in an area as is 
evidenced by extensive testimony presented without challenge in hearings held 
earlier this year. 
 
   
  Opposed by SAPA and an individual as being vague, ambiguous, and open to 
different interpretation each time used. The commissioner believes the rule 
should be amended to track the statutory requirements. 
 
   
  Opposed by SAPA and an individual. The commissioner disagrees with the 
comments because he believes the rules are consistent with generally accepted 
accounting principles (GAAP). However, the commissioner changes "current" market 
value to "fair" market value to avoid any confusion. A second individual opposed 
the valuation of inherited property. The commissioner agrees in part with the 
comment by the individual and amends the proposed rules. 
 
   
  Comment by an individual suggested a change in the form of business should be 
added. The commissioner agrees with the comment and adopts a new clause (iv) and 
renumbers the following clauses (v), (vi), and (vii), respectively. The old 
clause (v), now clause (vi) was opposed by two individuals. One proposed 
amending the rule for a period of three years; the other proposed five years. 
The commissioner disagrees with the comments. He does not feel that three or 
five years constitutes a "significant" relationship as is required in the 
statute; however, the commissioner feels that 10 years as proposed may be 
excessive and reduces 10 years to seven years as the time period constituting a 
"significant" relationship. 
 
   
  Comments opposing this subsection were received from two individuals. They are 
against increasing the net asset requirement due to a pawnshop moving from a 
municipality. The commissioner disagrees with the comments because the rule is 
consistent with the statutory directive of Texas Civil Statutes, Article 5069-
51.06(f). 
 
   
  Comments opposing the paragraph as too vague were received from an individual. 
The commissioner disagrees with the comments. The language is clear, consistent, 
and accurately describes the proper evaluation of financial responsibility. 
 
   
  SAPA and three individuals objected to requiring fingerprints of persons 
having "substantial relationship" with the licensee. The commissioner disagrees 
with the comments because the rules properly impose the statutory requirement in 
Texas Civil Statutes, Article 5069-2.02A(11)(a), that the commissioner "shall" 
obtain criminal history record information of "other persons having substantial 
relationships with the (business) entity." Full sets of fingerprints are 
required to obtain information from the FBI. 
 
   
  Cash America proposes changing the financial statement date from 60 to 90 days 
preceding the filing of the application. The commissioner disagrees with the 
comment as proposed but believes that the first sentence of subparagraph (C) 
should be amended. 
 
   
  Cash America proposes that the clause be amended to read "net assets" rather 
than "assets." The commissioner agrees with the comment. 
 
   
  The clause is opposed by SAPA and an individual. SAPA asserts "No one can 
command the confidence of the public. You have to earn the confidence..." The 
individual asserts that an applicant cannot know if the applicant will command 
the confidence of the public. The commissioner disagrees with the comments 
because the Act requires that the commissioner find that an applicant has the 
financial responsibility, experience, character, and general fitness to command 
the confidence of the public. 
 
   
  An individual objects to this requirement on the grounds that zoning is 
controlled by the city in which the business is to be situated, and is not the 
concern of the commissioner. The commissioner believes the rule to be 
appropriate as drafted. The required filing only supports the requirement of 
Texas Civil Statutes, Article 5069-51.03A(3), that the pawnshop will be operated 
lawfully and fairly. Evidence of compliance with rules and ordinances of a 
coordinate body of government is relevant to general fitness. 
 
   
  Cash America suggested adding "according to the most recent federal decennial 
census" after the word "more." An individual suggested changing the heading 
because it seems to limit the kind of evidence the commissioner might look at to 
determine and to demonstrate public need and sufficient volume of business. The 
commissioner has considered each suggestion and concurs by adopting new 
language. Express Cash asked the commissioner to consider a simpler process 
regarding finding need and which would be quicker and less expensive. Express 
Cash suggested the one-mile rule as proposed later by the Texas Pawn Brokers 
Association (TPBA) be considered. See commissioner's comments at sec.85.2(c)(4). 
 
   
  An individual objected to this clause and clauses (iii) and (iv) on the 
grounds that "community" needs to be defined. The commissioner rejects such 
objection. Community is adequately defined in the rule. An individual commented 
that community plus one mile represented too large an area and suggested removal 
of the one-mile provision. The commissioner disagrees and believes that 
applicants should identify competition one mile outside their designated 
community. This will facilitate evaluation of the validity of the designated 
community and whether any gerrymandering has been done in an attempt to hide 
competitors. Cash America suggested amending this subsection by adding 
"including name and address" after the word "identify" in the fourth line. The 
commissioner accepts this suggestion. 
 
   
  An individual objects to requiring a budget projecting volume of business and 
estimated income and expenses of the proposed pawnshop because "The commissioner 
has auditors to see whether the consumer is being taken care of by the 
pawnshop's daily operations. Profit/loss statements should not be required for 
the right to do business." The commissioner disagrees with this comment for the 
reason that the statute requires an application to show that there is a 
reasonable prospect for profitability of a proposed pawnshop. The determination 
of a reasonable prospect for profitability of an applicant for a license cannot 
be determined before a license has been granted by an auditor's determination 
that the "consumer is being take care of." A second individual contended that a 
three-year budget does not show probability of profitability and suggested 
character and fitness will do more than a crystal ball budget. The commissioner 
disagrees and finds that examination of an applicant's budget and the source of 
the data used produces evidence of or a lack of evidence of a probability of 
profitability. 
 
   
  An individual objects to requiring an existing licensee relocating within a 
county of 250,000 to more according to the most recent federal decennial census 
to show that a public need exists. He states that the law does not require a 
showing of public need for a relocation within such county. The commissioner 
disagrees with this interpretation of the law and rejects the objection. 
 
   
  Pursuant to the previously mentioned changes to sec.85.2(b)(1)(F)(i), clause 
(v) is deleted. An individual states that this clause "needs to be stricken." 
 
   
  Cash America suggested that the last sentence of this paragraph should be 
revised to list certain specific media that are prohibited. The commissioner 
disagrees, believing a broader prohibition is needed. The commissioner amends 
the sentence to provide for one exception. 
 
   
  Three comments were received objecting to this paragraph. One individual 
stated that there is no statute that allows for a temporary facility and one 
should not be allowed. The commissioner rejects the objection that a temporary 
facility should not be allowed on the grounds that the public need would be 
better served by a temporary facility rather than no facility. Another 
individual objected to a temporary facility on the basis that zoned locations 
may not be available within 1/2 mile radius of their permanent location. The 
commissioner believes that any temporary facility authorized should be within 
1/2 mile of a permanent location. A third individual objected to the subsection 
for the following reason: "community and distance limiting. This should be 
considered on a situation basis." The commissioner agrees that the establishment 
of a temporary facility should be determined on a case-by-case basis as is 
provided in the rule which sates that the commissioner "may" approve the 
temporary facility. 
 
   
  License application amendments. Cash America suggested striking the paragraph 
as redundant. The commissioner does not agree and rejects the suggestion. The 
rule applies beyond the time period for processing applications. 
 
   
  An individual objected to this subparagraph on the grounds that "The applicant 
has already paid fees for the license. Additional fees are not needed." The 
commissioner rejects the objection and states that House Bill 1258 imposed 
additional expenses on the agency in processing applications. The statutory fees 
are not sufficient to cover cost. This fee is established pursuant to statutory 
authority. 
 
   
  Cash America commented recommending deletion of the reference to 
sec.85.2(f)(2) in coordination with a recommendation to delete that paragraph. 
An individual commented that the paragraph was open-ended and needed to be 
specific. The commissioner disagrees with Cash America; see comments at 
sec.85.2(f)(2). The commissioner disagrees that the paragraph is open-ended in 
that fees not numerically specified in the paragraph are detailed elsewhere in 
the rules. 
 
   
  An individual commented that the 30 days given to complete an application 
might not be sufficient if the applicant had to rely on a source over which the 
applicant had no control. The commissioner disagrees with the objection because 
an applicant should only file a complete application which is defined in the 
preceding section as one which conforms to the commissioner's printed 
instructions for making an application. Any person affected by the subsection 
will have had written notice of the requirements before filing, has filed an 
incomplete application in disregard to the instructions, and has failed to 
complete the application within 30 days after a specific written notice of 
deficiencies is sent. Applicants who will not follow written instructions may 
lack the willingness or ability to follow the statutes and rules governing 
pawnshop operation. 
 
   
  Cash America commented that the first sentence does not specify precisely when 
the commissioner will mail the notice and asked if mailing would follow a 
finding of substantial completeness. The commenter recommended that the rule 
specify that the deadline date set out in the notice must be less than 30 days 
following the date of the notice and prohibit anyone who does not file notice of 
intention to appear at the hearing by the deadline date would not be allowed to 
present testimony or evidence. An individual recommended that the notice not be 
sent until the application is complete. The commissioner disagrees that the 
proposed rule does not specify when notices will be mailed. The rule provides 
that notices will be sent at the time of initial review of the application which 
is further defined in sec.85.2(c)(1). The commissioner agrees that the rule 
should require the notice have a deadline and amends the rule accordingly. The 
commissioner disagrees with the suggestion to require protestants to identify 
all witnesses by the deadline date. Applicable procedural rules permit any party 
to obtain identification of witnesses for the purpose of conducting pre-hearing 
discovery. The commissioner disagrees with the recommendation that notices of 
applications not be sent until an application is complete. In the past, notices 
have resulted in docket call appearances prior to applications being completed 
which was unnecessary time and effort. Since docket calls are no longer being 
used, hearings will not be scheduled on incomplete applications. The 
commissioner believes there is potential savings to applicants and potential 
applicants by issuing the notice as early as reasonably possible. 
 
   
  TPBA and Cash America have proposed that the proposed rule be made more 
restrictive to limit pawnbrokers eligible to request a hearing to those with 
pawnshops within a one-mile radius. As an alternative recommendation Cash 
America would further make pawnbrokers with shops within the applicant's defined 
community eligible to request a hearing. An individual suggested expanding the 
proposed rule to authorize requests for hearings from pawnbrokers within a one-
mile radius of the applicant's defined community. Another individual observed 
that there was no basis in fact for an arbitrary one mile "zone" of market 
influence for recognition of a party and asserted that "in most cases the market 
will be much smaller." TPBA also requested that the commissioner adopt a 
companion rule that would prevent "any new applicant for a pawn license" from 
proposing a site within one mile of an existing licensee, i.e., in a county with 
a population of 250,000 or more. The commissioner disagrees with all commenters 
at this time believing the proposed rule to be reasonable since interested 
persons urge both restricting and broadening the proposed rule. The commissioner 
does not accept as correct the second commenter's apparent assertion that in 
most cases a new pawnshop would not even affect other pawnshops up to one mile 
away. In the interest of compatibility the commissioner agrees to consider 
amending sec.85.2(c)(4) concurrent with consideration of TPBA's request for a 
new rule. This request will be considered as a petition for adoption of a rule 
and will be considered in a separate later proceeding. 
 
   
  Cash America and an individual objected to the lack of specificity in the 
first sentence of this paragraph. Cash America further suggested that the 
language specifying the initial setting of the hearing prevented extensions or 
continuance and could limit discovery. Cash America further suggested that the 
last sentence indicates any party could require an alternate hearing location 
and requested the rule approve moving the hearing from the prescribed site only 
by agreement. Two individual commenters objected to prescribing the hearing site 
as the Finance Commission Building asserting conflict with Texas Civil Statutes, 
Article 6252-13f. The commissioner clarifies the first sentence to specify his 
intent as requested. The commissioner disagrees that the setting of a hearing 45 
days after the application is completed prevents postponement. After a hearing 
date is set any party may petition the assigned administrative law judge for 
continuance, discovery, etc. according to procedural rules governing the 
hearing. The commission agrees that the final sentence of the proposed paragraph 
would permit any party to require an alternate site. The commissioner recognizes 
and agrees with the fundamental philosophy of a party being entitled to a 
neutral site at which a case is heard. The proposed rule does not permit any 
party to dictate a specific site. Under the proposed rule any party who objected 
to use of the Finance Commission Building hearing rooms would be authorized to 
petition the administrative law judge for a different site and the commissioner 
would not object to the removal to a different site, but might object to other 
specific sites deemed unsuitable for a particular proceeding. The commissioner 
does not fully understand and therefore neither agrees nor disagrees with the 
objection to the specificity of the last sentence but agrees to strike same. 
 
   
  Cash America suggests and the commissioner agrees that only complete 
applications should be considered under this paragraph. The word "complete" has 
been inserted in the adopted rule. An individual suggested that the section be 
more specific in lieu of the commissioner being authorized to exercise judgment. 
The commissioner disagrees, because subsequent applications could be designed to 
illegitimately interfere with and delay an application in process. A decision by 
the commissioner concerning concurrent applications in the same general area or 
with defined or defacto overlapping communities is consistent with the authority 
granted in Texas Civil Statutes, Article 5069-51. 05(b)(3). 
 
   
  Cash America recommended deletion of this paragraph as unnecessary and 
inviting motions to reopen. The commissioner disagrees with the request to 
delete but agrees with the commenter's concerns. The commissioner amends the 
paragraph accordingly. 
 
   
  Cash America requested clarification of this subsection to expressly state 
that applications hereunder are not subject to Texas Revised Statutes, Article 
5069-51.04 (a)-(c). The commissioner strongly disagrees. Such proposal would be 
contrary to the expressed intent of the first sentence of Texas Civil Statutes, 
Article 51.04(a) to cover changes in ownership. Further, it would eliminate 
application standards for any person purchasing an existing license, prevent the 
commissioner from charging any fees to cover cost of investigating a purchaser, 
and facilitate entry of unsavory persons into the pawn business via purchase of 
a licensed business. 
 
   
  Cash America recommended stipulating herein that the commissioner would grant 
or deny such applications within 10 days of proper filing unless the time is 
extended by agreement. The commissioner disagrees with the need for such an 
addition in light of the statutory authority contained in Texas Civil Statutes, 
Article 5069-51.05(g). 
 
   
  SAPA commented they did not see the need for requiring an application if the 
person is already in the business. The commissioner believes that while certain 
gifts or inheritances of pawnshop licenses or interests therein may not warrant 
precisely identical treatment, the commissioner has the duty to investigate 
whether the new owner meets applicable statutory requirements at the time of 
acquisition. Perhaps the commenter overlooked the fact that certain 
beneficiaries of a gifted interest must meet the $150,000 net assets requirement 
or that while a person may be "in the business", the licensing standards to be 
an employee are not as strict as to be an owner. Carmichael proposed allowing a 
person 45 days to give the commissioner notice of acquisition by gift or 
inheritance. The commissioner believes it reasonable to require notice of both 
types of changes in 10 days as proposed. 
 
   
  An individual referenced two very brief and general comments to this paragraph 
which obviously do not relate to this paragraph and the commissioner is unable 
to determine their intended application. 
 
   
  Comments were received from SAPA, three individuals and Express Cash to the 
general effect that the 45-day provision was not adequate or realistic. The 
commissioner agrees and strikes the words relating to inheritance. The result is 
that any heir must file an application within 14 days of transfer of the 
pawnshop interest to the heir which will generally occur as part of the probate 
proceedings and often precede closing of the estate. 
 
   
  Cash America suggested clarification of language in the heading and first 
sentence. The commissioner agrees and adopts the suggested clarifying language. 
 
   
  and (ii). Four individuals generally opposed the proposed clauses asserting 
that the commissioner lacks the authority to distinguish between relocations 
within and without a one-mile radius and to require a finding of public need and 
probability of profitability before approving more distant relocations. Cash 
America did not oppose regulations of relocations within counties with 
populations of 250,000 or more, but suggested clarification of the requirements 
including deletion of a reference to community. Another individual commented on 
clause (ii) only concerning the potential for undue hardship in an involuntary 
relocation, questioned the validity of the one-mile boundary, and suggested 
perhaps there should be coordination with distance requirements in zoning 
ordinances. A sixth individual commented that one mile was not realistic, each 
relocation should be considered on an individual basis, "the only requirement 
needed should be if moving too close to an existing pawnshop," and that existing 
licenses have already qualified under "show need." City of Dallas requested 
clarification that compliance with local zoning ordinances be required for 
relocations of one mile or less. The commissioner disagrees with the four 
individuals. The commissioner believes that the proposed rule is within the 
authority of Texas Civil Statutes, Article 5069-51.09(b), to make rules "for the 
enforcement of this Act and consistent with its provision." The commissioner 
finds that the legislature has specifically directed the commissioner to find a 
public need and probability of profitability for certain new and relocated 
pawnshops. The commissioner finds that exercising some control over relocations 
of pawnshops in counties with populations of 250,000 or more is essential. 
Control will prevent new license applicants from obtaining licenses without 
opposition in communities with few, if any, pawnshops and promptly thereafter 
moving them to locations where the commissioner would not find a public need for 
new pawnshops. While there is negligible legislative history in this area the 
commissioner understands that in 1991 the legislature via House Bill 1258 
removed the authority of the cities to control pawnshop siting through specific 
use permits. At the same time the legislature gave the commissioner authority to 
control pawnshop licenses in the more populous counties where cities were 
concerned with the proliferation of pawnshops in general and especially certain 
areas of certain cities. While the cities have the authority to determine the 
zoning categories in which pawnshops will be permitted, they lack the authority 
to otherwise control the siting of pawnshops. A prominent pawnbroker involved in 
the passage of House Bill 1258 expressed the understanding that the legislation 
was to "slow them (pawnshop license applications) down, spread them (pawnshops) 
out, and keep them from clustering." The commissioner has heard no disagreement 
from pawnbrokers generally with the purpose statement quoted and in fact has 
heard the "prevention of clustering" used as a reason for the amendment to the 
Act. The commissioner has adopted the one-mile radius distinction based on his 
belief that most pawnshops draw the majority of their business from their 
immediate environs. A pawnbroker relocating within a one-mile radius due to loss 
of lease or unsuitability of location or facilities would typically be remaining 
in his community or trade area and attempting to retain his customer base. Input 
from many pawnbrokers indicates substantial agreement. The commissioner elects 
to impose minimal regulatory burden on such relocations as sufficient to carry 
out the purposes of the Act. Relocations beyond one mile are generally expected 
to place the pawnshop in a new or substantially different community or trade 
area and the commissioner believes that public need and probability of 
profitability should be demonstrated by the relocating pawnbroker in the same 
manner as is required for a new license. The commissioner agrees with the fifth 
individual that there may arise a hardship in connection with an involuntary 
relocation but absent a specific proposal to address same elects to adopt the 
essence of the rule. Also absent specific suggested changes concerning distances 
the commissioner makes no changes in the one mile. The commissioner disagrees 
with the sixth commenter's comments and has previously addressed the issue of 
the one-mile distance. The commissioner believes that each relocation cannot be 
handled fairly and equitably independently of every other relocation and without 
rules governing same. The commissioner finds that most existing licenses have 
not demonstrated public need, but that demonstration of public need at one site 
generally has no bearing on another site perhaps 10-20 miles away. The 
commissioner also believes his responsibility in this area is broader than 
keeping one pawnshop from "moving too close to an existing pawnshop." SAPA did 
not oppose regulations of relocations within counties with populations of 
250,000 or more but opposed the proposal by suggesting five miles be substituted 
for one mile. An individual did not oppose regulations of relocations within 
counties with populations of 250,000 or more but commented that one mile was too 
short and that five miles was probably too much distance. She also suggested the 
commissioner  point=8.03p set=8.03p>should have discretion. The commissioner 
disagrees and believes one mile is most appropriate. The commissioner agrees 
with the proposed clarification by Cash America and adopts same. The 
commissioner agrees in principle with the City of Dallas comment but finds that 
the proposed clarification would have a much broader impact than the City of 
Dallas intended. The end result desired by the City of Dallas is accomplished by 
addition of a sentence to clause (i). 
 
   
  Cash America suggested striking this paragraph as being of limited usefulness 
and proving an opportunity for abuse. An individual commented that inactive 
licenses should be treated as an existing license. The commissioner agrees with 
Cash America's comments but disagrees with their suggested strike. The 
commissioner currently must deal with over 200 inactive licenses. The 
commissioner's current records and procedures incorporate only a single address 
for communicating with pawnbrokers holding only one license and that address is 
shown on the license whether or not active. The commissioner believes the 
paragraph is useful to uniformly instruct all pawnbrokers affected and effective 
September 1, 1991, required review and approval of address changes and 
activations of pawnshop licenses at a higher level of agency management and 
supervision to prevent abuses or circumvention of pertinent statutes, policies, 
and rules. The commissioner disagrees with the individual for reasons stated 
previously on the presumption that "existing" license means "active" license. 
The proposed rule states the commissioner's long-standing policy and adds the 
certification requirement. 
 
   
  An individual comments that the proposal is overly restrictive and notice 
requirements should be handled on a case-by-case basis. The commissioner 
disagrees. The proposed paragraph represents long-standing policy and procedure 
in this area and believes that pawnbrokers benefit from an official written 
guideline as to notices to customers when a pawnshop is moved. Careful reading 
of the proposed paragraph will reveal considerable flexibility which the 
commissioner has found to work well in the past. 
 
   
  SAPA, and eight individuals commented in general opposition to the proposed 
subsection or asked that currently held licenses not be subject to the 
subsection. Express Cash suggested a modification to the 36-month period. The 
commissioner agrees in part and strikes the subsection. 
 commenters made general comments against the rules which expressed the aversion 
of the commenter to the general philosophy of governmental regulation: HTG 
Enterprises, Inc., Old Fort Trading Post, San Antonio, stated "In general, I 
feel our business' (sic) does not require, nor need additional bureaucratic 
regulations."; Action Loans, Inc., El Paso, stated "I have met informally with 
the local independent pawnbrokers and we are all in agreement about the 
observation I have made on the rules. We feel that government is taking too big 
a roll (sic) in business today. We realize there are some who will take 
advantage of any situation, there are those kinds of people in any industry, not 
just the pawn industry. The pawn industry is becoming so regulated, that it 
almost takes a full-time person to keep up with the latest laws and rules. We 
really feel that things have gotten out of hand. "; Doniphan Pawn & Surplus, El 
Paso, stated his general opposition to the proposed rules "as too much 
government" and not necessary in light of the existing statutory provisions. The 
commissioner disagrees with the individuals because the commissioner believes 
that the rules are appropriate government regulation. 
 commenters requested a different rule be adopted: TPBA and SAPA. TPBA requested 
that a rule be adopted "where any new applicant for a pawn license select a 
location at least one mile from an existing licensee." SAPA requested that a 
rule be adopted: "We recommend a one-mile radius between open pawnshops, i.e., 
if you apply for a new license and it is within a mile of another pawnshop and 
they oppose. You must pay all of the cost of the hearing win or lose! On the 
other side if your store is not within a mile of the site of the new license you 
would have to pay all cost of a hearing to oppose that license. We feel this 
would stop unnecessary hearings, prevent clustering of pawnshops, and provide a 
case-by-case way of handling licenses with less than a mile between them. In 
regards to moving an existing pawn shop we recommend five mile radius of present 
location. No hearing required." The commissioner will consider these two 
requests as petitions for adoption of a rule and these requests will be 
considered in a separate later proceeding. 
 1, 1992, a public hearing was held in Austin to receive comments on the 
proposed sections. The following commenter made comments for the proposed 
sections: corporate affairs counsel, EZCORP-EZPAWN, Austin. The following 
commenters made comments for the sections as proposed, but with requested 
changes to various subsections: chairman of the board, Texas Pawn Brokers 
Association, Fort Worth; vice chairman of the board, Texas Pawn Brokers 
Association, Houston; president, San Antonio Pawnbroker's Association, San 
Antonio, president, l9th Hole Pawn Shop, Harker Heights; CJM Enterprises 
Incorporated, Killeen; Cisneros Enterprises, Corpus Christi; president, Cash 
America International, Inc., Fort Worth; president, Alamo Pawn Shops of Texas, 
Inc., Midland; Local Loan and Investment Corp. of Sweetwater, Sweetwater; Clark, 
Thomas, Winters & Newton, Austin; president, A.C. Pawnbrokers, Inc., 5859 
Gessner, Houston; Action Loans, Inc., El Paso; Double Eagle Pawn, Odessa; 
Doniphan Pawn & Surplus, El Paso; HTG Enterprises, Inc., Old Fort Trading Post, 
San Antonio; vice president, Express Cash International, San Antonio; vice-
president H&F Pawn Inc., Killeen; assistant city attorney, City of Dallas; 
Action Pawn, Killeen; member Texas Senate, 28th District, Lubbock; chief 
administrative law judge, State Office of Administrative Hearings, Austin; Crown 
Jewelry, Houston; member State Senate, District 20, Corpus Christi; C & V Pawn 
and Jewelry, Inc., San Antonio; The following commenters made general comments 
against the sections: HTG Enterprises, Inc., Old Fort Trading Post, San Antonio; 
Action Loans, Inc., El Paso; Doniphan Pawn & Surplus, El Paso. The following 
commenters requested a different rule be adopted: chairman of the board, Texas 
Pawn Brokers Association, Fort Worth, and vice chairman of the board, Texas Pawn 
Brokers Association, Houston; president, San Antonio Pawnbroker's Association, 
San Antonio. 
 sections are adopted under Texas Civil Statutes, Article 5069-1.09, which 
provide the commissioner of the Office of Consumer Credit Commissioner with 
authorization to adopt rules necessary for ensuring compliance with Texas Civil 
Statutes, Article 5069-51.01 et seq. 
 
   
  sec.85.2. Pawnshop Licensing. 
 
  (a) Qualifications. 
 
  (1)  Character and general fitness. When an application is received the 
commissioner shall investigate the facts to determine if the applicant is of 
good moral character and possesses the financial responsibility, experience, 
character, and general fitness such as to warrant belief that the business will 
be operated lawfully and fairly within the purposes of the Pawnshop Act. 
   
  (2) Net assets. 
 
  (A) Determination of net assets. Pursuant to Texas Civil Statutes, Article 
5069-51.02(g), an applicant or licensee's net assets is the sum of cash on hand, 
bank deposits, the value of merchandise inventory held for sale in the pawnshop 
or to be held for sale in the pawnshop, and the amount of money loaned on open 
pawn loans receivable less any and all unsecured debts, and debts secured in 
whole or part by the previously listed assets. Assets must be available for use 
in the pawnshop business to be acceptable. Net assets of licenses obtained under 
a $25,000 or less requirement are determined by the criteria used at the time 
the license was granted. 
   
  (B) Determination of value of merchandise inventory. The value of merchandise 
inventory shall be the lower of the owner's actual cost or the fair market 
value. The fair market value is the price that a willing seller would accept and 
a willing buyer would pay for the total inventory transferred in a single bulk 
sale within 30 days of the valuation. Valuations at cost must be substantiated 
by the books of the owner which are maintained according to generally accepted 
accounting principles. Property subject to exemption by the Property Code, 
sec.42.001, et seq, is specifically excluded from consideration as merchandise 
inventory. Property inherited or received as a gift shall be valued according to 
generally accepted accounting principles. 
   
  (C) Net assets requirement. All new license applications must meet the 
$150,000 net assets requirement. Each existing pawnshop license has a specific 
net assets requirement. Certain changes in ownership do not affect the net 
assets requirement. The net assets requirement does not change when: 
 
  (i)  a person who owns an interest in a pawnshop sells that interest to one or 
more persons who concurrently own interest(s) in that pawnshop; 
   
  (ii)  a corporate pawnshop purchases shares of its own stock from one of its 
shareholders; 
   
  (iii) a change occurs in the proportionate ownership between or among persons 
owning interests in a pawnshop; 
   
  (iv) a change in the form of business organization without a change in the 
beneficial ownership; 
   
  (v) a person inherits an ownership interest in a pawnshop; 
   
  (vi) em>>a person acquires an interest in a pawnshop where the person has been 
employed or has served as an officer or director for a period of 10 years or 
more; or 
   
  (vii) a person acquires an ownership interest in a pawnshop from a person who 
is related to the acquirer within the second degree by affinity or 
consanguinity. 
     
  (D) Increase of net assets requirement. Except as defined in subparagraph (c) 
of this paragraph, the net assets requirement is subject to increase when any 
natural person initially acquires an ownership interest in a pawnshop or when a 
pawnshop changes its business location by moving from a municipality. When such 
a change occurs, the following formula will be used to determine if there is an 
increase in the net assets requirement. The sum of the book values of the 
pawnshop's pawn loans and inventory as of the date of change shall be multiplied 
by 1.05 and the product shall be rounded to the next higher multiple of $5,000 
but shall not exceed $150,000. The result of the preceding calculation shall be 
the new net assets requirement for the license if it exceeds the net assets 
requirement immediately before the date of change. A net assets requirement 
shall never be reduced. 
     
  (3) Financial responsibility. In evaluating the financial responsibility of 
applicants, the commissioner shall investigate the history of the applicant as 
to the applicant's payment of debts, taxes, and judgments, if any, and handling 
of financial affairs generally. 
   
  (4) Experience. In evaluating the experience of applicants the commissioner 
shall investigate the history of the applicant and if the applicant is a 
business entity, each operator and each legal or beneficial owner, and, as to a 
corporation to each officer, director, shareholder of at least 5.0% of the 
shares outstanding, and employees as to their previous experience in the 
operation or management of a Texas pawnshop or other business. 
     
  (b) Applications. 
 
  (1) Filing requirements. An application for a pawnshop license must be 
submitted on forms prescribed by the commissioner at the date of filing and in 
accordance with the commissioner's published instructions. Each applicant shall 
submit with the application such statements, exhibits, maps, plans, photographs, 
and other data, sufficiently detailed and comprehensive to enable the 
commissioner to determine whether the applicant meets the requirements for the 
proposed pawnshop. The application shall include, but not be limited to, the 
following. 
 
  (A) Disclosure of principal parties. In submitting an application for a 
license all principal parties must be fully identified. As used herein 
"principal party" includes all proprietors and individuals associated with 
applicants as general partners, limited partners, officers, directors, 
shareholders owning any outstanding stock, trustees, and beneficiaries of 
trusts. The term also includes any individual or legal entity who either 
directly or through ownership or control of any parent or other entity has a 
beneficial interest in the licensed entity. All corporations must identify any 
officer, director, or shareholder required to be identified in this subparagraph 
who is an officer, director, or shareholder of any other corporation licensed 
under Texas Civil Statutes, Article 5069. Any corporation described in Texas 
Civil Statutes, Article 5069-51.04(d) shall identify its shareholders through 
filings required by Texas Civil Statutes, Article 5069-51. 04(d). 
   
  (B) Fingerprints requirement. As required in Texas Civil Statutes, Article 
5069-2.02(11)(a), et seq, each applicant shall provide a complete, legible set 
of fingerprints. If the applicant or the licensee is a business entity, this 
fingerprint requirement applies to all individuals who are required to be named 
on a license application form. Natural persons who have been licensed by the 
commissioner for five or more years and have maintained a satisfactory level of 
compliance as determined by the commissioner, shall be exempt from the 
fingerprint requirement. The commissioner may require fingerprints of employees 
or other persons having substantial relationships with a licensed applicant and 
of such persons described in this paragraph who are associated with a licensed 
pawnshop. 
   
  (C) Financial statement. The application shall contain a statement of the 
financial condition of the applicant(s) as of a date within 60 days preceding 
the filing of the application unless the applicant is required to file a 
quarterly financial statement with the Securities and Exchange Commission, and 
has filed such statement with this office in compliance with Texas Civil 
Statutes, Article 5069-51.03(d), then a financial statement so filed within the 
last 90 days shall be acceptable. If the applicant is a sole proprietor, a 
personal financial statement of the proprietor shall be filed. If the business 
entity is a general partnership, personal financial statements of each partner 
must be filed. If the applicant is a limited partnership, a financial statement 
for the partnership and a personal financial statement of each general partner 
shall be filed. Financial statements of partners must have a common date. If the 
business entity is a corporation, a corporate financial statement must be filed. 
Financial statements of natural persons shall be on the forms prescribed by the 
commissioner. Financial statements of all other persons shall contain all 
information required on the commissioner's form for natural persons. 
   
  (D) Sworn statement of qualifications. Each applicant shall file a sworn 
statement in which the applicant asserts: 
 
  (i) the applicant is of good moral character; 
   
  (ii)  the applicant has the required net assets readily available for use in 
conducting the business of the proposed pawnshop; 
   
  (iii) the pawnshop will be operated lawfully and fairly within the purposes of 
the Act; and 
   
  (iv) the applicant has the financial responsibility, experience, character, 
and general fitness to command the confidence of the public in the operation of 
the pawnshop. 
     
  (E) Zoning. Each applicant shall file a certificate of occupancy or other 
evidence that the operation of a pawnshop is permitted at the proposed site. 
   
  (F) Evidence demonstrating public need and probability of profitability. Each 
applicant for a new or relocated license in a county with a population of 
250,000 or more according to the most recent federal decennial census shall file 
evidence demonstrating public need and probability of profitability. This 
evidence shall include, but not be limited to: 
 
  (i) a map of the area in which the proposed license or relocated license will 
be situated graphically defining the boundaries of the community to be served by 
the proposed shop, the site of the proposed shop, the site and identity 
(including name and address) of each existing pawnshop or license in the 
community and within one mile outside the perimeter of the community, and the 
scale at which the map was constructed; 
   
  (ii) a budget detailing the projected volume of business and the estimated 
income and expenses of the proposed shop for the first three years of operation; 
   
  (iii) a statement of the population of the community and of any municipality 
fully or partially located in the community; 
   
  (iv) a sworn statement that a public need exists for the proposed pawnshop and 
that the volume of business in the community in which the proposed pawnshop will 
conduct its business indicates a profitable operation is probable. 
       
  (2) Engaging in business. An application must be filed and approved before any 
person engages in the business of making pawn loans. The application and 
approval is required without regard to the rate of interest or pawn service 
charge contracted for, charged, or received, if any. An applicant shall not 
advertise the opening of a new or relocated pawnshop prior to approval, except 
that a pawnbroker who intends to relocate a pawnshop may, beginning 90 days or 
less prior to the projected date of relocation, post a sign inside the existing 
shop and give customers written notices of the anticipated relocation. 
   
  (3)  Temporary facility. The commissioner may approve opening and operating a 
temporary facility for an approved application, provided that such facility is 
within the community and within 1/2 mile radius of the approved, permanent site. 
The operation of the temporary facility will cease immediately upon the 
permanent facility being completed for occupancy. The temporary facility shall 
not operate longer than 18 months unless extended in writing by the 
commissioner. 
   
  (4) License application amendments. Where appropriate, each pawnbroker shall 
provide the commissioner with information supplemental to that contained in the 
pawnbroker's original application documents and attachments. Any action, fact, 
or information that would require a materially different answer than that given 
in the original license application and which relates to the qualifications for 
license shall be reported to the commissioner within 10 business days after the 
person has knowledge of the action, fact, or information. 
   
  (5) Notices and fees relating to applications and hearings. 
 
  (A) Applications for a change of ownership or a new license shall pay a $250 
investigation fee if an 80% or greater interest is held by principals and owners 
of a separate licensed pawnshop. 
   
  (B) Each applicant for a new or relocated license in a county with a 
population of 250,000 or more shall pay $1.00 to the commissioner for each 
notice of application that is required to be mailed to a pawnbroker by the Act 
and to a pawnbroker described in paragraph (1)(F)(i) of this subsection. 
   
  (C) The parties in favor of an application shall pay one-half of the expense 
of the administrative law judge and one-half of the expense of the court 
reporter and the remaining cost shall be paid by the parties opposed to an 
application. The commissioner may assess and the parties shall pay the cost of 
agency staff time in excess of one hour representing the agency in a hearing on 
a protested application. 
   
  (D) The relocation of a pawnshop or license pursuant to subsection (f)(1)(A), 
(B)(i), and (2) of this section shall require a fee of $25. Any other relocation 
shall require a $250 investigation fee and such other fees as may be required of 
a new license applicant. 
       
  (c) Processing of applications. 
 
  (1) Initial review. The commissioner will respond to applications within 14 
working days of receipt acknowledging completeness, identifying deficiencies, 
and requesting additional information, if necessary. A completed application is 
one which conforms to the commissioner's published instructions and for which 
all fees have been paid. The commissioner may reject a substantially incomplete 
application. 
   
  (2) Failure to complete application. If a complete application has not been 
filed with the commissioner within 30 days after the initial review has been 
sent to the applicant, the application will be denied and the investigation fee 
shall be forfeited. The annual fee shall be refunded to applicant. 
   
  (3) Notice of application to pawnbrokers. Upon initial review of an 
application the commissioner shall mail notice of the application to each 
pawnshop licensee in the county of the proposed location as well as any other 
pawnshops required to be identified in subsection (b)(1)(F)(i) of this section. 
The notice shall state a date and time, not more than 30 days following the date 
of notice, by which any interested person must request a hearing and petition to 
be recognized as a party. 
   
  (4) Request for public hearing and recognition as a party. Any pawnshop 
licensee in the designated community of an applicant or within one mile of the 
proposed pawnshop site shall be deemed affected by an application and may 
request the commissioner hold a public hearing on the application before issuing 
a pawnshop license. Any other pawnbroker who believes that the applicant's 
proposed pawnshop will significantly affect that pawnbroker's current business 
may submit a sworn petition to be admitted as a party in opposition to an 
application for a new or relocated pawnshop. The petition must present the 
commissioner with relevant facts designed to show how the protesting pawnbroker 
will be affected by the approving of the proposed application. Upon a showing 
that the pawnbroker would be significantly affected by the granting of the 
license, the commissioner shall admit the protesting pawnbroker as a party. 
   
  (5) Notice of protest. Any person intending to appear, and present evidence, 
and be heard on a license application may do so only if written notice of such 
intention is filed and received by the commissioner as required in the notice of 
application. A copy of such written notice shall be delivered to the applicant 
and certification of that delivery shall be made to the commissioner at the time 
of filing. 
   
  (6) Public hearing. Upon a proper and timely request for a hearing from an 
interested person or upon request of the commissioner's staff, the commissioner 
or the administrative law judge shall set a date for the hearing. The date shall 
not be more than 45 days after the date the completed application has been 
filed. 
   
  (7)  Subsequent competing application. If an application is filed at least 10 
days before the date set for the hearing of a pending application, for a 
location which, in the opinion of the commissioner, is for the same community as 
the pending application, all such applications may be heard in one hearing. 
   
  (8) Amendments to pending applications. If any material change occurs in the 
facts set forth in an application, or if the applicant files any amendment to an 
application filed with the commissioner, the amendment setting forth the change, 
together with copies of documents or other material relevant to any change shall 
be filed with the commissioner no less than 10 days prior to the date of 
hearing. A copy of the filing shall be delivered to all parties and 
certification of that delivery shall be made to the commissioner at the time of 
the filing. Any amendment filed fewer than 10 days prior to the date of hearing 
shall be accepted only at the discretion of the administrative law judge and the 
administrative law judge may, upon motion of any party, postpone or delay the 
hearing to a later date if it appears that the amendment materially alters the 
application on file. 
   
  (9) Unprotested application. If an application has been properly filed 
pursuant to the provisions of the Texas Pawnshop Act, this section the 
commissioner's printed instructions, and if a request for a hearing has not been 
filed with the commissioner, a license may be granted without the necessity of a 
public hearing if the commissioner is satisfied that the applicant has met the 
eligibility requirements of Texas Civil Statutes, Article 51.03A, Article 51.04, 
and Article 51.05. 
   
  (10) Motion to reopen. Subsequent to the closing of the hearing record of an 
application, the hearing may not be reopened except on motion of the 
commissioner. 
   
  (11)  Motions for rehearing. If a motion for rehearing is filed pursuant to 
the Texas Administrative Procedure and Texas Register Act (APTRA) sec.16(e), 
copies of the motion shall be delivered to all parties and certification of the 
delivery shall be made to the commissioner at the time of filing the motion. 
     
  (d) Notice to commissioner of change of ownership or form of business. An 
application must be filed and approved in connection with any change of 
ownership except as otherwise provided herein. A change in the proportionate 
interests of two or more owners of a pawnshop must be reported in writing within 
10 calendar days but does not require an application. 
 
  (1) Sale, transfer, or assignment. Any sale, transfer, or assignment of a 
pawnshop shall be reported to the commissioner no later than three business days 
after the transaction and the transaction shall be made subject to, and on the 
condition of, the approval of the commissioner. An application for license is 
required to be filed by the purchaser, transferee, or assignee. 
   
  (2)  Acquisition of pawnshop by gift or inheritance. Any person or other legal 
entity acquiring any pawnshop or any interest in a pawnshop through gift or 
inheritance shall notify the commissioner within 10 calendar days and submit 
such proof of ownership as the commissioner may reasonably require. An 
application for license is required to be filed. 
   
  (3) Organizational form of business. A pawnbroker desiring to alter the 
organizational form of business under which the licensed business is conducted 
without effecting any change in beneficial ownership, management, or control 
shall advise the commissioner and file an application reflecting such change. 
   
  (4) Application filing deadline. Applications filed in connection with changes 
of ownership or organizational form of business may be filed in advance but must 
be filed no later than 14 calendar days following the actual change. 
     
  (e) Purchaser operating under seller's license. The commissioner may approve a 
written agreement whereby a seller grants a buyer the authority to operate a 
pawnshop under the seller's license pending approval of the buyer's license 
application. The agreement must provide that the seller accepts full 
responsibility to the commissioner and any customer of the pawnshop for any acts 
of the buyer in connection with the operation of the pawnshop. The written 
agreement between the seller and buyer must be submitted with a request to 
operate under the seller's license not less than three business days after the 
date of sale. The agreement shall be for a limited time as provided in the 
agreement and in no case may such authority extend beyond 180 days or until a 
decision is rendered. 
   
  (f) Relocation of a pawnshop or license. 
 
  (1) Notice to commissioner; requirements. 
 
  (A) Relocation within or into a county with a population less than 250,000. A 
pawnbroker may relocate a pawnshop or pawnshop license within or into a county 
with a population less than 250,000 according to the most recent federal 
decennial census, but must first forward notice of the intended relocation to 
the commissioner, together with documentation that local authorities have 
authorized operation of a pawnshop at such location, where applicable, not less 
than 30 days prior to the anticipated relocation date. The notice shall be on a 
form prescribed by the commissioner and must include the present name and 
address of the licensed pawnshop, the anticipated date of relocation, and a 
sample copy of the written notice to pledgors of open pawn loans. 
   
  (B)  Relocation within or into a county with a population of 250,000 or more. 
When a pawnbroker wishes to relocate an existing license within or into a county 
with a population of 250,000 or more according to the most recent federal 
decennial census, the following rules shall apply. 
       
  (i)  Relocation within a one-mile radius. If the relocation is within a one 
mile radius of the licensed location, the relocation requires prior notice to 
the commissioner in the same manner as provided in subparagraph (A) of this 
paragraph. If the pawnbroker has not conducted a normal pawnshop business at 
that location for two or more years, the relocation will require the prior 
approval of the commissioner (which the commissioner shall grant or deny within 
15 days of such notice); provided, however, that if the commissioner has 
reasonable cause to believe that the pawnbroker is attempting to evade the 
statute and these rules through consecutive relocations of one mile or less, the 
commissioner may require compliance with clause (ii) of this subparagraph. 
Relocations within a one-mile radius after two or more years of active business 
operation at the initial pawnshop site do not require approval of the 
commissioner. The pawnbroker shall file a certificate of occupancy or other 
evidence that the operation of a pawnshop is permitted at the proposed site. 
 
  (ii) Relocation beyond a one mile radius. A pawnshop or pawnshop license may 
not be relocated beyond a radius of one mile from the licensed location without 
the prior approval of the commissioner. In that event, the pawnbroker shall make 
application to the commissioner for the relocation of the license. Approval of 
the application for relocation shall be subject to a finding by the commissioner 
of a public need for the proposed pawnshop and of a volume of business within 
the community in which the pawnshop will conduct its business such as to 
indicate that a profitable operation is probable. Such applications will be 
processed subject to all rules and procedures as applications for new licenses. 
   
  (2) Inactive licenses. A license which will not be used to operate a pawnshop 
at its new address may be amended upon receipt by the commissioner of the 
license, identification of the new address, certification that no pawn loans 
will be made at that address, and the appropriate fee. 
   
  (3)  Notice to customers. Written notices of relocation must be given to all 
pledgors whose pledged goods will be moved. Five days prior to relocation the 
pawnbroker must mail written notices to all pledgors who have not been given 
written notices prior to that date. Notices must identify the pawnshop, identify 
both the old and the new locations, and the telephone number of the new location 
and date the relocation is effective. The commissioner may modify the 
notification requirements if the relocation adversely affects pledgors. Such 
modification may require the pawnbroker to extend the maturity date of pawn 
transactions and/or waive the collection of pawn service charges which may 
accrue after relocation. No relocation shall be made which will adversely affect 
pledgors to the extent that redemption is unreasonable or impossible due to the 
distance between the locations. The commissioner may approve notification by 
signs in lieu of notification by mail if in his opinion no pledgors will be 
adversely affected. 
     
  (g) Relocation of pawn loans. A pawnbroker may sell pawn loans to a 
nonaffiliated licensee or transfer pawn loans to an affiliated licensed 
location. The pawnbroker must notify the commissioner of an intended transfer to 
an affiliate not later than three business days in advance of the transfer and 
of a sale to a nonaffiliate no later than three business days after the date of 
sale and prior to actual relocation. The notice must include the present name 
and address of the selling pawnshop, the name and address of the receiving 
pawnshop, the anticipated date of sale or transfer, a sample copy of the notice 
to be mailed to pledgors, and a copy of any agreement between the buyer and 
seller concerning the sale of loans. The "Notice to Customers" provisions of 
subsection (f)(3) of this section are applicable to such sales and transfers. 
   
  (h) Expiration and renewal of licenses; fees. 
 
  (1) General expiration date. All pawnshop licenses and the pawnshop employee 
licenses of employees of such pawnshops shall expire on June 30 of each year 
unless the annual fees for the following year have been paid. 
   
  (2) Pro rata fees. The license fee for any new pawnshop license shall be the 
statutory annual fee if that license becomes effective more than six months 
prior to its expiration date; otherwise, the fee shall be one-half of the annual 
fee. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 12, 1992. 
 TRD-9213764 
  Al Endsley 
 Consumer Credit Commissioner 
 Office of Consumer Credit Commissioner 
    Effective date: November 2, 1992 
 Proposal publication date: September 4, 1992 
 For further information, please call: (512) 479-1280 
         
                   
  TITLE 25. HEALTH SERVICES 
 Part II. Texas Department of Mental Health and Mental Retardation 
  Chapter 401. System Administration 
  
  Subchapter G. Community Mental Health and Mental Retardation Centers 
 
  25 TAC sec.sec.401.451-401.461 
 
  The Texas Department of Mental Health and Mental Retardation (TXMHMR) adopts 
the repeal of sec.sec.401.451-401.461, without changes to the proposed text as 
published in the May 5, 1992, issue of the Texas Register (17 TexReg 3225). The 
sections are repealed contemporaneously with the adoption in this issue of the  
Texas Register of new sec.sec.401.451-401.464 governing community mental health 
and mental retardation centers. 
 The purpose of the repeal is to allow the adoption of new sections which would 
update requirements by which community centers are to be constituted and receive 
state or federal funds from or through the department. 
 No comments were received regarding adoption of the repeals. 
 The repeals are adopted under the Texas Health and Safety Code, sec.532.015, 
which provides the Texas Department of Mental Health and Mental Retardation with 
rulemaking authority. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on Ocotber 12, 1992. 
 TRD-9213744 
  Ann Utley 
 Chairman 
 Texas Board of Mental Health and Mental Retardation 
    Effective date: November 2, 1992 
 Proposal publication date: May 5, 1992 
 For further information, please call: (512) 465-4670 
         
       
  25 TAC sec.sec.401.451-401.464 
 
  The Texas Department of Mental Health and Mental Retardation (TXMHMR) adopts 
new sec.sec.401.451-401.464. Sections 401.452-401.464 are adopted with changes 
to the proposed text as published in the May 5, 1992, issue of the Texas 
Register  (17 TexReg 3225). Section 401.451 is adopted without changes and will 
not be republished. The new sections are adopted contemporaneously with the 
adoption of the repeal of the subchapter they would replace, known as Chapter 
401, Subchapter G, governing community mental health and mental retardation 
centers. 
 The purpose of the new subchapter is to update requirements by which community 
centers are to be constituted and receive state or federal funds from or through 
the department. 
 Throughout the sections language has been clarified. Section 401.453 has 
changed to add definitions of "facility," "facility community-based services," 
and to delete definitions of "board" and "subcontractor" because the terms are 
not used in the subchapter. The term "contract period" has been changed to 
"contract term" to reflect current terminology and the definitions of "board of 
trustees," "community center," "core services," "local agency," "local match," 
"local MHMR authority," mental health services," and "priority population" have 
been changed for clarification. 
 The title of sec.401.454 has changed from "Support of Partnership with 
Community Centers" to "Philosophy" to be more representative of the section. 
 The title of sec.401.457 has been changed from "Appointments of Boards of 
Trustees" to "Appointments of Boards of Trustees of Community Centers" to 
clarify the content of the section. 
 The title of sec.401.459 has been changed from "Awarding of Funds" to 
"Performance Contract" to clarify that a community center must first enter into 
a performance contract before funds are disbursed. The term "award" is 
inappropriate in this context. Section 401.459(d), relating to mental health 
block grant funds, has been deleted because it is a reiteration of federal 
regulation currently required of community centers. The specific requirements 
regarding compliance are also described in the performance contract between the 
department and a community center. 
 The title of sec.401.460 has been changed from "Standards of Administration for 
Boards of Trustees" to "Standards of Administration for Boards of Trustees of 
Community Centers" to clarify the content of the section. 
 Language has been added to sec.401.461 to require compliance with the Americans 
With Disabilities Act of 1990. 
 Written comments were received from the Texas Council for Community Mental 
Health and Mental Retardation Centers; Austin, Advocacy, Inc.; Austin, Concho 
Valley MHMR; San Angelo, and Riceland Regional MHA; Wharton. 
 A commenter noted that certain provisions that were mandated by Senate Bill 112 
as passed during the last legislature were not included in the proposal. Those 
provisions are guidelines for due process protections, determination of salaries 
for community center employees, and training for the board of trustees. The 
department responds that those guidelines are still in the process of being 
developed. The rule will be amended when those guidelines have been formulated. 
 The same commenter expressed concern that only one position on the board of 
trustees is reserved for a consumer or family member of a consumer. The 
commenter cites this as a contradiction to sec.401.454(a)(1), which states that 
persons receiving services, as well as their families and friends, should have a 
prominent role in determining which services best meet their needs. The 
department responds that there are many roles that persons receiving services or 
their families can play in determining which services best meet their needs, 
e.g., advisory committees, planning process. They do not necessarily have to be 
on the board of trustees in order to have a role. The department encourages 
participation of persons receiving services and their families and friends. 
 The same commenter noted that although local MHMR authorities are mandated by 
state law, many of them are not providing the full range of core services. The 
commenter states that the department's "only effective redress, other than 
persuasion, is to pull the entire contract-for-services to a specific authority. 
With the community center generally being the sole provider of MHMR services, 
discontinuing the contract is not practical or realistic. However, the consumer 
or family member is left with little recourse if dissatisfied with the response 
of the center." The department responds that it is able to retract that portion 
of the contract not being met. This would allow another entity to provide those 
services and not leave consumers without any support. The department adds that 
the state law which mandated provision of core services was passed without 
adding additional resources. In order to adequately fund core services around 
the state a cooperative effort must be organized among the department, the Texas 
Council of Community MHMR Centers, advocacy organizations, and consumers to 
approach the state legislature for more funding. 
 A commenter suggested adding the word "annual" to the definition of "local 
match." The department responds that community centers enter into performance 
contracts with the department on an annual basis; therefore, it is not necessary 
to clarify local match as "required annual local financial participation." 
 A commenter expressed concern with the definition of "local service area" 
because in 1968 a TXMHMR attorney offered the opinion that a community center 
could not offer services outside of the geographic boundaries of its organizing 
agencies. The department responds that the Texas Health and Safety Code, 
sec.534.015(c), allows for community centers to contract with other counties to 
provide services to persons in those counties. 
 A commenter suggested adding the term "region" as defined in the Texas Health 
and Safety Code. The department responds that the term "local service area," 
which is more widely used by the department, describes the same concept. 
 A commenter suggested adding language to sec.401.454(d) clarifying the 
establishment of a community center. The department responds that language has 
been added. 
 The same commenter suggested changing the title of sec.401.456 from "Modifying 
a Community Center's Plan to Serve Adjoining Geographic Areas" to "Modifying a 
Community Centers's Existing Approved Plan" to more appropriately reflect the 
content. The commenter also suggested expanding the section to include direction 
for not only affiliation of a local agency with an existing community center, 
but also the termination of an affiliation and the expansion or reduction of the 
local service area. Adding criteria for reviewing the modification of an 
existing plan was also recommended. The department responds that language has 
been modified as suggested. 
 A commenter suggested changing the title of sec.401.458 from "Approval of Plan" 
to "Approval of Plan and Plan Modifications" to more appropriately reflect the 
content. The department responds that language has been changed. 
 A commenter noted that sec.401.458(a)(1)(B)(3) should include the establishing 
agencies' acknowledgement of their responsibility for assuring the center that 
they have the local matching funds required by the contract with TXMHMR. The 
department responds that the establishing agencies' acknowledgement of their 
responsibility is stated in sec.401.455(c). 
 A commenter suggested adding preface language to sec.401.459(a) stating "if a 
community center is designated as an authority." The department responds that 
language has been modified to address this commenters' concern. 
 The same commenter suggested either deleting sec.401.460(d) (because it would 
be impossible to verify if department or local match funds were being used for 
building alterations, renovations, and/or repair maintenance) or establishing a 
meaningful and timely review process. The department responds that past 
experience indicates the need for prior approval of building alterations, 
renovations, and/or repair maintenance in order to meet appropriate building 
codes, standards, and specifications to accommodate contracted programs. To 
avoid undue delays, the support services division of the department has prepared 
a written review process in which approval is sought at least 30 days prior to 
the release of the project for competitive bids. 
 A commenter wanted assurance that the language in sec.401.460(k) is still 
accurate and appropriate and not too restrictive in light of the Public Funds 
Investment Act. The department responds that the language does not violate the 
act. 
 The new sections are adopted under the Texas Health and Safety Code, sec.532. 
015, which provides the Texas Department of Mental Health and Mental Retardation 
with rulemaking authority. 
 
 
  sec.401.452. Application.  This subchapter applies to all community mental 
health and mental retardation centers established under the Texas Health and 
Safety Code, Title 7, Chapter 534 (formerly the Texas Mental Health and Mental 
Retardation Act, Texas Civil Statutes, Article 5547-203). 
 
   
  sec.401.453. Definitions.  The following words and terms, when used in this 
subchapter, shall have the following meanings, unless the context clearly 
indicates otherwise. 
   
     Board of trustees -A body of not less than five nor more than nine persons 
selected and the Texas Health and Safety Code, Title 7, sec.534.002 or 
sec.534.003 which has responsibility for the effective administration of a 
community center. 
   
     Commissioner-The commissioner of the Texas Department of Mental Health and 
Mental Retardation. The commissioner is the state mental health authority and 
the state mental retardation authority for Texas. 
   
     Community center -A community mental health and mental retardation center 
established under the Texas Health and Safety Code, Title 7, Chapter 534. 
   
     Contract term-The beginning date through the ending date of a contract. 
   
     Core services-Services to be provided for each local service area as 
stipulated in the Texas Health and Safety Code, Title 7, sec.534.053 including, 
but not limited to: 
 
  (A) 24-hour emergency screening and rapid crisis stabilization services; 
   
  (B)  community-based crisis residential service or hospitalization; 
   
  (C)  community-based assessments, including the development of 
interdisciplinary treatment plans and diagnosis and evaluation services; 
   
  (D) family support services, including respite care; 
   
  (E) case management services; 
   
  (F) medication-related services, including medication clinics, laboratory 
monitoring, medication education, mental health maintenance education, and the 
provision of medication; and 
   
  (G)  psychosocial rehabilitation services, including social support 
activities, independent living skills, and vocational training. 
     
     Department-The Texas Department of Mental Health and Mental Retardation. 
   
     Facility-Any state hospital, state school, state center, or other entity 
which is now or may hereafter be made a part of the department. 
   
     Facility community-based services-Community residential and nonresidential 
programs under the jurisdiction of a facility. 
   
     Local agency-A county, municipality, hospital district, school district, or 
any organizational combination of two or more of these which may establish and 
operate a community center. 
   
     Local match-Required local financial participation which represent, on a 
contract-specific basis, the amount of local funding the local MHMR authority 
commits to complement department funding for the contracted services, expressed 
in the contract as a dollar amount or as a funding percentage of the state 
general revenue contract for services funds. 
   
     Local MHMR authority -A local service provider designated by the department 
to direct, operate, facilitate, or coordinate the delivery of mental health 
and/or mental retardation in a local service area. 
   
     Local service area-A geographic area composed of one or more Texas counties 
delimiting the population which may receive services from a community center or 
a facility in its function as a local MHMR authority. 
   
     Mental health services-All services concerned with research, prevention, 
and detection of mental disorders and disabilities and all services necessary to 
treat, care for, supervise, and rehabilitate persons with a severe and 
persistent mental illness which may be accompanied by chemical dependency or 
mental retardation. 
   
     Mental retardation services-All services concerned with research, 
prevention, and the detection of mental retardation and all services related to 
the education, training, habilitation, care, treatment, and supervision of 
persons with mental retardation, except the education of school-age individuals 
that the public educational system is authorized to provide. 
   
     Priority population -Those groups of persons with mental illness or mental 
retardation identified in the department's current strategic plan as being most 
in need of mental health or mental retardation services. 
 
   
  sec.401.454. Philosophy. 
 
  (a) The department is committed to the provision of accessible and appropriate 
services in the community to persons in the priority population. Furthermore, 
the department recognizes the importance of local control vested in a community 
center which has also been designated as the local MHMR authority. Therefore, 
the department supports and encourages the creation and expansion of community 
centers and the delegation to those local units of government the role and 
authority as the local MHMR authority. The following principles are important in 
the development of local services. 
 
  (1) Persons receiving services, as well as their families and friends, should 
have a prominent role in determining which services best meet their needs. 
   
  (2) Persons with mental illness or mental retardation should be integrated 
into the activities and social fabric of the local community. 
   
  (3) Decisions by local boards of trustees of a community center should be made 
openly with consideration of the view of those affected by the decisions. 
   
  (4) Local communities, persons receiving services, and community centers 
should work together to identify service delivery needs and plan a system that 
meets these needs. 
   
  (5) The availability and quality of service should be the same, regardless of 
where a person resides in the state. 
     
  (b) The provisions of this subchapter are intended to promote an 
interdependent partnership of state and local government in the form of local 
boards of trustees of community centers; these provisions recognize the 
importance of local initiatives and control in the development and expansion of 
community services. 
   
  (c) The advantage for a local agency in forming a new community center or 
affiliating with an existing community center is the greater degree of local 
ownership and control of the services provided. The department's intent is to 
encourage and promote the development of new community centers in areas 
currently served by facility community-based services. 
   
  (d) A community center must be established pursuant to the Texas Health and 
Safety Code, Title 7, Chapter 534, Subchapter A. A specific requirement of that 
statute requires the approval by the department of a plan to deliver mental 
health or mental retardation services. The elements of such plan and the 
procedure for submitting and approving the plan are described in sec.401.458 of 
this title (relating to Approval of Plan and Plan Modifications). 
 
     
  sec.401.455. Process to Establish a Community Center. 
 
  (a) The local agency which desires to establish a community center must submit 
a letter of intent to the commissioner outlining the proposed center's service 
area, governing structure, and other information pertinent to the formation of 
the proposed center. 
   
  (b) If the local agency submitting the letter of intent is not a county or 
counties, the letter must be accompanied by a letter of endorsement from the 
appropriate county judge or judges. 
   
  (c) The commissioner shall designate staff who are knowledgeable of community 
center operations to review the viability of the letter of intent using the 
following criteria. 
 
  (1) The rationale for creating a community center must clearly support the 
benefits of a new center over the expansion of an existing center. 
   
  (2) The population of the proposed service area of a new community center 
shall be greater than 100,000; 
   
  (3) The requirement for local match shall be met; and 
   
  (4) The intent of the community center shall be to serve both persons with 
mental illness as well as persons with mental retardation, even though the 
center may initially not be able to do so. 
     
  (d) The commissioner's response to the local agency's letter of intent shall 
be based on the review described in subsection (c) of this section and shall be 
sent to the local agency by certified mail, return receipt requested. 
   
  (e) If the commissioner approves the letter of intent, the local agency 
follows the provisions of this subchapter pertaining to the appointment of a 
local board of trustees, the development of a written plan, and the submission 
of the written plan to the commissioner for approval by the Texas Board of MHMR. 
   
  (f) If the Texas Board of MHMR approves the plan, then the department shall 
issue a certificate recognizing its status as a community center. The department 
may also designate the community center as the local MHMR authority and may 
enter into a performance contract with the community center in accordance with 
the provisions of Chapter 401, Subchapter E of this title (relating to Contracts 
Management). 
 
     
  sec.401.456. Modifying a Community Center's Existing Approved Plan. 
 
  (a) When a local agency wants to affiliate with an existing community center 
and the existing center agrees, the board of trustees of the existing center 
will submit to the commissioner a modification of the center's existing plan to 
reflect such affiliation, including any expansion of the center's proposed local 
service area. Included with such submission shall be letters of intent from the 
present local agency of the center and the proposed affiliated local agency. If 
the proposed local agency is not a county or counties to be served by the 
affiliation, then the letters of intent must be accompanied by a letter of 
endorsement from the appropriate county judge or judges. 
   
  (b)  When a local agency wants to terminate its organizational combination 
with another local agency and end its affiliation with an existing community 
center, the board of the existing center will submit to the commissioner a 
modification of the center's existing plan to reflect the termination of such 
affiliation, including any change of the center's local service area. Included 
with such submission shall be letters of intent from the local agency which is 
terminating its relationship with the center. 
   
  (c) When an existing center wants to change its existing approved plan by 
expanding or reducing its local service area or substantially changing its 
service delivery system without changing its local agency, the board of the 
existing center will submit to the commissioner a modification of the center's 
existing plan to reflect such changes. Included with such submission shall be 
letters of endorsement of such changes from the center's local agency. 
   
  (d) The commissioner shall designate staff to review the requested 
modification of the plan using the following criteria. 
 
  (1) The population of the proposed service area of a new community center 
shall be greater than 100,000. 
   
  (2)  The requirement for local match shall be met. 
   
  (3) The intent of the community center shall be to serve both persons with 
mental illness as well as persons with mental retardation, even though the 
center may initially not be able to do so. 
 
       
  Boards of Trustees of Community Centers.  The local agency that receives 
approval based on the letter of intent described in sec.401.455 of this title 
(relating to Process to Establish a Community Center) to establish a community 
center must prescribe criteria and procedures for of boards of trustees as 
described in the Texas Health and Safety Code, Title 7, sec.534.002. Each local 
agency shall prescribe and make available for public review the following: 
 
  (1)  the application procedure for a position on the board of trustees; 
   
  (2) the procedure and criteria for making appointments to the board of 
trustees, including tenure, consumer representation, geographic, and ethnic 
representation as addressed in the Texas Health and Safety Code, Title 7, 
Chapter 534, Subchapter A; 
   
  (3) the procedure for posting and filling a vacancy on the board of trustees; 
and 
   
  (4) the procedure and grounds for removing a member of the board of trustees. 
 
     
  sec.401.458. Approval of Plan and Plan Modifications. 
 
  (a)  Boards of trustees of community centers established after the effective 
date of this subchapter shall submit to the commissioner a written plan to 
provide effective mental health and mental retardation services to the residents 
of the proposed local service area. The written plan shall include the following 
elements: 
 
  (1) a comprehensive service plan, which describes: 
 
  (A) the vision, mission, and the short and long-range goals of the community 
center, consistent with the department's vision, mission, and goals; 
   
  (B) the financial, physical, and personnel resources of the proposed local 
service area, including comparable or companion services available from other 
sources; 
   
  (C) a systematically derived estimate of the total number of people in need of 
mental health and mental retardation services in the proposed local service 
area, including the estimates of the number of people in the mental health and 
mental retardation priority populations; 
   
  (D) the estimate of the number of people in the proposed local service area 
that will be provided services, which includes an estimate of the number of 
people in the priority population that will be served; 
   
  (E) how core and other services are to be provided either directly or by 
contracting with other entities; 
   
  (F) the effect of these services on other components of the service delivery 
system, including state hospitals, state schools, state centers, and other 
community centers; 
   
  (G) the projected annual cost of delivering specialized services, including 
specific estimates for the mental health and mental retardation priority 
populations; 
   
  (H) proposed transfer of funds from facility community-based services; 
   
  (I) the involvement of local advocacy organizations, persons to be served, and 
their families in planning and delivering services; and 
   
  (J) the extent of involvement in the planning process and in the delivery of 
services by entities contracting with the community center; 
     
  (2) an organizational plan, including: 
 
  (A)  organizational structure of the board of trustees and the community 
center; 
   
  (B) board of trustees membership; 
   
  (C) a copy of the bylaws of the board of trustees; and 
   
  (D) a copy of the contract entered into by the organizing bodies as required 
by the Texas Health and Safety Code, Title 7, sec.534.003; 
     
  (3) a financial plan, including a proposed performance contract with 
attachments and budget on forms to be supplied by the department; and 
   
  (4) the board of trustee's assurance that it understands and will enforce 
compliance with applicable state and federal laws, rules, standards, and 
regulations. 
     
  (b) The department shall provide support to the board of trustees of a 
community center during the planning process. This support may include technical 
assistance, coordination with other community centers to provide assistance, 
identifying potential funding sources, and other assistance as deemed 
appropriate. The commissioner shall ensure necessary review of the plan, 
including a site visit by department personnel. Any amendments to the plan must 
be submitted to the commissioner for final written approval. 
   
  (c) The written plan by the board of trustees is not recognized as a community 
center by the department until the Texas Board of MHMR approves the plan. A 
community center may enter into a performance contract only if the Texas Board 
of MHMR approves the plan required in subsection (a) of this section, and 
determines that the center can appropriately, effectively, and efficiently 
provide services in the proposed local service area. 
   
  (d) A community center may operate for the purposes defined in the center's 
plan, the elements of which are described in subsection (a)(1) of this section. 
As circumstances and needs change, the center should amend the plan with the 
department. 
 
     
  sec.401.459. Performance Contract. 
 
  (a) The department may enter into a performance contract with a community 
center that has been designated as an authority and that performance contract 
will govern the interaction between the department and the contracting community 
center. 
   
  (b) The department shall contract with local MHMR authorities in conformance 
with the provisions described in Chapter 401, Subchapter E of this title 
(relating to Contracts Management), and as required or allowed by state law, 
including the appropriations act. 
 
     
  sec.401.460. Standards of Administration for Boards of Trustees of Community 
Centers. 
 
  (a) Each board of trustees is accountable to the department for the effective 
use of all funds received from or through the department and all funds required 
for local match. 
   
  (b) Boards of trustees shall assure the submission of periodic financial and 
performance reports to the department in a format and schedule prescribed by the 
department as per their performance contract. 
   
  (c) It is expected that the board of trustees of each community center will 
institute effective management procedures which will assure the maximum 
utilization of all funds received from or through the department and all funds 
required for local match and will facilitate the achievement of the goal of 
delivering services of high quality for the lowest possible cost. 
   
  (d) As a service to community centers and to ensure buildings are altered, 
renovated, and/or repaired according to appropriate codes, standards, and 
specifications, the department shall approve any building alterations, 
renovation, and/or repair maintenance expenses exceeding $50,000 for each 
project per fiscal year per community center if department or local match funds 
are to be used. In accordance with the review process and to avoid undue delays, 
boards of trustees shall seek advance written approval from the support services 
division of the department at least 30 days prior to the release of the project 
for competitive bids. 
   
  (e) Boards of trustees must ensure that a community center receives written 
approval from the department prior to purchase, lease-purchase, or any other 
transaction, the result of which will be the community center's ownership of 
real property, including buildings, if any department funds or local funds 
required to match department funds are involved. A community center must provide 
written notification to the contracts management office of the department 60 
days prior to entering a legally binding obligation to purchase, lease-purchase, 
or otherwise enter into a transaction, the result of which will be the community 
center's ownership of real property, including buildings, in cases in which no 
department funds or local funds required to match department funds are involved. 
Upon request, the commissioner may waive the 60-day requirement on a case-by-
case basis. Notification is not required for donations of real property under 
the Texas Health and Safety Code, Title 7, sec.534.019, that do not require the 
expenditure of any funds by the community center and that have been approved by 
the board of trustees. 
 
  (1) All notices and requests for approval shall be accompanied by supporting 
information including, but not necessarily limited to, the following: 
 
  (A)  the reason for purchasing the property or a brief explanation of the 
purpose it will serve; 
   
  (B) a summary of the plan for paying for the property, including a statement 
regarding whether departmental or required local match funds will be used either 
directly or in the retirement of any debt associated with the acquisition; 
   
  (C) if unimproved, an assessment of the suitability of the property for 
construction purposes or, if improved, an assessment of the current condition of 
the buildings; 
   
  (D)  an appraisal of the property prepared by an appraiser certified by a 
master appraisal institute; however, this requirement may be waived if the 
purchase price is less than the value listed for the property by the local 
appraisal district and the property has been appraised by the local appraisal 
district within the past two years; 
   
  (E) a statement that the board of trustees and executive staff are not 
participating financially in the transaction and shall derive no personal 
benefit from the transaction; and 
   
  (F) a statement detailing the need to waive the 60-day requirement if a waiver 
is being requested. 
     
  (2) A community center may not purchase or lease property for an amount that 
is greater than the property's appraised value unless: 
 
  (A) the board of trustees documents in the official minutes the reasons why 
the purchase or lease is necessary at that price; and 
   
  (B) a majority of the board approves the transaction. 
       
  (f) In acquiring real and personal property pursuant to subsection (e) of this 
section and constructing improvements in connection with such acquisitions, 
boards of trustees may issue bonds or notes in accordance with Texas Civil 
Statutes, Article 717k-6 and 717q, and may enter into contracts in accordance 
with the Local Government Code, sec.sec.271.003-271.009. The limitations 
regarding real property and the construction of improvements contained in the 
Local Government Code, sec. sec.271.003-271.009, does not apply to community 
centers. Boards of trustees shall ensure that any bonds or notes issued by the 
community center receive the approval of the attorney general of the State of 
Texas prior to issuance. 
   
  (g) Boards of trustees shall retain all financial records, supporting 
documents, statistical records, and any other documents pertinent to community 
center budgets, contracts, performance/workload measure, and persons served for 
a period of five years. If audit discrepancies have not been resolved at the end 
of five years, the records shall be retained until resolution. 
   
  (h) Each board of trustees shall expend annually its required local match and 
department funds in the same ratio as the required local match is to the 
department funds. 
   
  (i) Boards of trustees may accept special gifts for long-range projects and 
plans. These funds must be kept separate from the operating budget of the 
community center and may not be used for local matching purposes. An annual 
accounting of these reserve funds (center trust, endowment, or foundation 
resources) shall be made to the department. 
   
  (j) Boards of trustees shall comply with the Open Meetings Law, Texas Civil 
Statutes, Article 6252-17, as amended. 
   
  (k) Boards of trustees shall require depositories of community center funds to 
secure deposits through the Federal Deposit Insurance Corporation or the Federal 
Savings and Loan Insurance Corporation, or to secure deposits using collateral 
in a manner that protects the deposited funds. 
 
     
  sec.401.461. Civil Rights.  Each community center shall provide services in 
compliance with the Civil Rights Act of 1964, as amended, and the Americans With 
Disabilities Act (ADA) of 1990, and shall require the same of entities with 
which they contract. 
 
   
  sec.401.462. Fiscal Auditing Procedures. 
 
  (a) Each board of trustees of a community center shall submit to the 
department copies of an annual audit of its accounts made by a certified or 
public accountant licensed by the Texas State Board of Public Accountancy, which 
the department shall distribute to the governor, the Legislative Budget Board, 
the Legislative Audit Committee, and others. Such audit shall follow generally 
accepted auditing standards and shall be in accordance with the most recent 
edition of "Guidelines for Annual Fiscal Audits of Community MHMR Centers," 
which is herein adopted by reference as Exhibit A and is available from the 
Texas Department of Mental Health and Mental Retardation, P.O. Box 12668, 
Austin, Texas 78711. 
   
  (b) The audits will be submitted to the department no later than 120 days 
following the end of each contract term and shall be approved by the board of 
trustees of a community center. If the board of trustees of a community center 
declines to approve such audit, it shall attach to each copy of the audit a 
statement detailing its reason for failure to approve the audit. 
 
     
  sec.401.463. References.  Reference is made in this subchapter to the 
following federal and state laws and rules: 
 
  (1) Anti-Drug Abuse Act of 1988 (Public Law 100-690); 
   
  (2) Texas Health and Safety Code, Title 7, Chapter 534 (formerly the Texas 
Mental Health and Mental Retardation Act, Texas Civil Statutes, Article 5547-201 
et seq as amended); 
   
  (3) Texas Civil Statutes, Article 717k and 717q; 
   
  (4) Texas Civil Statutes, Article 6252-17; 
   
  (5) Local Government Code, sec.sec.271. 003-271.009; and 
   
  (6) 25 TAC, Chapter 401, Subchapter E, governing Contracts Management. 
 
     
  sec.401.464. Distribution.  This subchapter shall be distributed to members of 
the Texas Board of MHMR; the medical director, deputy commissioners, associate 
and assistant deputy commissioners, directors and section chiefs of central 
office; superintendents/directors of state facilities; and chairpersons, boards 
of trustees, and executive directors of community mental health and mental 
retardation centers. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 12, 1992. 
 TRD-9213815 
  Ann Utley 
 Chairman 
 Texas Board of Mental Health and Mental Retardation 
    Effective date: November 2, 1992 
 Proposal publication date: May 5, 1992 
 For further information, please call: (512) 465-4670 
         
                 
  TITLE 28. INSURANCE 
 Part I. Texas Department of Insurance 
  Chapter 5. Property and Casualty Insurance 
  
  Subchapter G. Workers' Compensation Insurance 
 
  Workers' Compensation Insurance Subscriber Notices 
 
  28 TAC sec.sec.5.6702-5.6707 
 
  The State Board of Insurance of the Texas Department of Insurance adopts new 
sec.sec.5.6702-5.6707 concerning workers' compensation insurance subscriber 
notices, with explanatory and clarifying changes to the proposed text as 
published in the July 21, 1992, issue of the Texas Register (17 TexReg 5059). 
 The new sections are necessary because the Workers' Compensation Act requires 
that certain notices, required by law to be made by an employer or an insurance 
company, be filed with the Department. The adopted sections prescribe the time, 
place, and manner in which the notices must be filed. Nonsubstantive changes 
have been made to sec.sec.5.6702-5.6707. The change to sec.5.6702 makes a slight 
referential change in subsection (b)(3) to the inception date of the business of 
the employer whose coverage is the subject of the notice. The change to 
sec.5.6703 makes a slight referential change in subsection (b)(3) to the 
inception date of the business of the employer whose coverage is the subject of 
the notice, makes a clarifying change in subsection (c) to provide that the 
notice be sent to the employer covered under the policy, and also provides 
clarification in subsection (e) that the effective date of any subsequent policy 
is the cancellation date of the previous policy. The change to sec.5.6704 makes 
a slight referential change in subsection (b)(3) to the inception date of the 
business required to provide the notice. The change to sec.5.6705 makes a slight 
referential change in subsection (b)(3) to the inception date of the business 
required to provide the notice. The change to sec.5.6706 makes a clarifying 
statement in subsection (b) that a governmental entity shall file notice of 
either self-insurance or worker compensation coverage with the department. The 
change also subsequently makes a clarifying statement in subsection (e) that the 
notice include the effective date of the self-insurance or worker compensation 
coverage. The change also includes a more full citation to the Texas Workers' 
Compensation Act in subsection (e). The change to sec.5.6707 makes an editorial 
change by referring to adopted, rather than proposed, rules and forms. 
 New 28 TAC sec.sec.5.6702-5.6707 set out detailed requirements for insurance 
companies and employers to follow in filing notices of workers' compensation 
insurance coverage, renewal, cancellation, reinstatement, termination, and/or 
non-coverage. The adopted sections prescribe the time, place and manner in which 
the notices must be filed. 
 Adopted sec.5.6702 sets out detailed requirements for insurance company notice 
of employer coverage. This adopted section requires the insurance company to 
file notice with the department on a TDI Form 20, Insurance Company Notice of 
Coverage/Cancellation/Non-Renewal, within 10 days after the effective date of 
the policy. This section also lists the information that shall be included in 
the notice. The adopted section also sets out annual notice reporting 
requirements. Additionally, the adopted section requires the insurance company 
of an employer with all-states insurance coverage, which is located outside of 
Texas but is temporarily operating in the state, to notify the department of 
that employer's coverage status, within 10 days after a written request for 
information from the Texas Workers' Compensation Commission. 
 Adopted sec.5.6703 requires an insurance company that cancels or non-renews a 
workers' compensation policy on the anniversary date of the policy to notify the 
department, by certified mail or in person, on TDI Form 20, Insurance Company 
Notice of Coverage/Cancellation/Non-Renewal. The adopted section sets out the 
effective date of a subsequent policy in instances where a notice of 
cancellation of a previous policy has not been filed with the department, and 
the previous policy is replaced by a subsequent policy. 
 Adopted sec.5.6704 requires each employer which employs one or more employees 
and which does not have workers' compensation insurance coverage, to notify the 
department. The notice is to be in writing, on TDI Form 5, Employer Notice of 
Non-Coverage or Termination, and filed annually, as provided in the adopted 
section. 
 Adopted sec.5.6705 requires each employer who terminates workers' compensation 
insurance coverage to notify the Department that the employer has terminated 
such coverage. The notice shall be in writing, on TDI Form 5, Employer Notice of 
Non-Coverage or Termination. The effective date of termination of workers' 
compensation shall be 30 days after filing TDI Form 20, Employer Notice of Non-
Coverage or Termination with the department or the cancellation date of the 
policy, whichever is the latest. The employer is responsible for premiums until 
the effective date of policy termination. The notice shall be filed with the 
department, by certified mail, not later than the 10th day after notifying the 
insurance company to terminate workers' compensation insurance coverage. 
 Adopted sec.5.6706 requires a government entity to file notice of self-
insurance or workers' compensation coverage with the department. The notice 
shall be in writing, on TDI Form 20-3, Self-Insured Governmental Entity-Notice 
of Insurance, and filed with the Department by certified mail or in person, 
within 10 days after the effective date of the policy or coverage. If the 
governmental entity is making a change of servicing contractor, or is being 
formed, such governmental entity shall file the required notice and thereafter 
annually on the anniversary date of the policy while in force. 
 Adopted sec.5.6707 provides that copies of the above identified forms for 
adoption by reference have been filed with the Office of the Secretary of State. 
Additional copies of the forms may be obtained from Robert A. Hefford, Director, 
Research and Special Projects, Workers' Compensation Division, Mail Code 202-1A, 
Texas Department of Insurance, P.O. Box 149092, Austin, Texas 78714-9092. 
 A total of three sets of comments were received on the sections as proposed and 
published. The Texas Workers' Compensation Commission, American Insurance 
Association, and CNA Insurance Companies commented generally in favor of the 
sections as proposed, but each recommended changes to the proposal. 
 Two of the commenters focused primarily on the quantity of data required on the 
TDI Form 20, Insurance Company Notice of Coverage/Cancellation/Non-Renewal, and 
the 10-day filing time requirement with the department. A large number of data 
elements collected are required for referencing and indexing. However, the Texas 
Workers' Compensation Commission has also specified data elements that they 
require pursuant to and in support of Article 3, Chapter B of the Texas Workers' 
Compensation Act, Texas Civil Statutes, Article 8308. One commenter noted an 
inconsistency between the proposed rules and the instructions for completion of 
the proposed forms adopted by reference. The department agrees with this 
comment, and has changed the Form 5 instructions to reflect a 10-day filing 
requirement for employer termination. Another comment addressed making certified 
mailing or hand delivery a requirement for all Form 20 notice submissions. The 
department does not believe that such a requirement is warranted for all Form 20 
notice submissions. Because Form 20 is a multi-use form, and is not submitted 
solely in the event of cancellation/non-renewal, placing the certified mailing 
requirement on the form for all submissions would cause an unnecessary 
administrative and financial burden on submitters. For this reason, the 
instructions for Form 20 specify that if the notice is being provided due to 
cancellation/non-renewal of coverage, such notice must be provided either by 
hand delivery or by certified mail, return receipt requested. One commenter 
requested all proposed rules and associated forms be changed to provide for the 
collection of the number of employees by location and Standard Industrial 
Classification (SIC) codes in support of the Extra-Hazardous Employer Program. 
The department does not believe that the forms associated with these sections 
represent the most appropriate or effective means of capturing this data. 
Moreover, the time delay associated with requirements to add the SIC code data 
requirement, and getting the rules republished for comment and adoption, would 
be detrimental and would outweigh any possible benefit associated with 
incorporating collection of SIC codes and related information into these forms. 
Additionally, this comment concerns the data collection for a program, other 
than subscriber and non-subscriber notices, that is under consideration by the 
department for evaluation of the scope and associated budget implications for 
computer software modification and additional data entry operators. 
 The new sections are adopted under Texas Civil Statutes, Article 8308, (Texas 
Workers' Compensation Act), sec.sec.3.22, 3.25, 3.26, 3.27, and 3.28; the 
Insurance Code, Article 1.04; and Texas Civil Statutes, Article 6252-13a, sec.4 
and sec.5. Texas Civil Statutes, Article 8308, sec.sec.3.22, 3.25, 3.26, and 
3.28 require that prescribed subscriber notices be filed with the Texas 
Department of Insurance. Section 3.27 authorizes the State Board of Insurance to 
adopt rules necessary to enforce Article 8308, sec.sec.3.21-3.30. The Insurance 
Code, Article 1.04(b) authorizes the Board to determine rules in accordance with 
the laws of this state. Texas Civil Statutes, Article 6252-13a, sec.sec.4 and 5 
authorize and require each state agency to adopt rules of practice, setting 
forth the nature and requirement of available procedures, and prescribe the 
procedures for adoption of rules by a state agency. 
 
 
  sec.5.6702. Insurance Company Notice of Employer Coverage. 
 
  (a) Each insurance company providing workers' compensation insurance to an 
employer shall file notice of such coverage with the Texas Department of 
Insurance. 
   
  (b) The notice shall be in writing, on TDI Form 20, Insurance Company Notice 
of Coverage/Cancellation/Non-Renewal, and shall contain the following 
information: 
 
  (1) insurance company name, servicing business address, NCCI number and 
federal employer identification number (FEIN); 
   
  (2) insurance agency name, business address, and FEIN; 
   
  (3) employer/insured name, "doing business as" (DBA name), if one exists, with 
effective date, business address, FEIN, number of employees, inception date of 
business, workers' compensation governing classification code assigned by the 
Texas Department of Insurance, and nature of business; 
   
  (4) current policy number, and effective dates; 
   
  (5) identification of divided risk or facility risk, if applicable; and 
   
  (6) name and signature of insurance company representative completing form and 
date of notice. 
     
  (c) Supplemental notice forms, as applicable, shall be attached to TDI Form 
20, as provided in this subsection. 
 
  (1) "Also Known As" names (AKAs), and effective date of each, shall be 
recorded on TDI Form 20-1. 
   
  (2) Identification of additional locations of employer's business, including 
employer/insured name, business address, FEIN, DBAs, workers' compensation 
insurance effective dates, and number of employees at each location shall be 
recorded on TDI Form 20-2. 
     
  (d) The information required by this rule shall be filed with the Texas 
Department of Insurance, by mail or in person, within 10 days after the 
effective date of the policy, and thereafter annually within 10 days after the 
anniversary date of the policy while in force. 
   
  (e) When an employer who is principally located outside of Texas carries all-
states coverage and temporarily operates in Texas, the insurance company shall 
provide written notice, pursuant to this section, within 10 days after a written 
request from the Texas Workers' Compensation Commission. 
   
  (f) An insurance company that fails to comply with this rule commits a Class C 
administrative violation, in accordance with the Texas Workers' Compensation 
Act, Article 8308, sec.3.25, and may be assessed an administrative penalty by 
the Texas Workers' Compensation Commission, not to exceed $1,000 for each day of 
noncompliance. 
 
     
  sec.5.6703. Insurance Company Notice of Cancellation/Non-Renewal of Employer 
Coverage. 
 
  (a) Each insurance company that cancels, or does not renew, an employer's 
workers' compensation policy on the anniversary date shall file notice with the 
Texas Department of Insurance. 
   
  (b) The notice shall be in writing, on TDI Form 20, Insurance Company Notice 
of Coverage/Cancellation/Non-Renewal, and shall contain the following 
information: 
 
  (1) insurance company name, servicing business address, NCCI number, and 
federal employer identification number (FEIN); 
   
  (2) insurance agency name, business address, FEIN; 
   
  (3) employer/insured name, "doing business as" (DBA) name, if one exists, with 
effective dates, business address, FEIN, number of employees, inception date of 
business, workers' compensation governing classification code assigned by the 
Texas Department of Insurance, and nature of business; 
   
  (4) indication of whether cancellation was initiated by company or employer; 
   
  (5) type of cancellation (30 day or 10 day); 
   
  (6) current policy number and effective date; 
   
  (7) date the insurance company notified the employer/insured of 
cancellation/non-renewal, and the effective date of cancellation/non-renewal; 
and 
   
  (8) name and signature of insurance company representative who completed the 
TDI Form 20, and the date of the notice. 
     
  (c) The information required by this section shall be sent to the employer, 
and also filed with the Texas Department of Insurance, by certified mail or in 
person, not later than 30 days before the date on which the cancellation or 
renewal becomes effective, except as provided in subsection (d) of this section. 
   
  (d) The insurance company may send notice to the employer and the Texas 
Department of Insurance not later than 10 days before the effective date of 
cancellation or non-renewal if the insurance company cancels, or does not renew, 
because of one or more of the following: 
 
  (1) fraud in obtaining coverage; 
   
  (2) misrepresentation of payroll amounts used for premium calculation; 
   
  (3) failure to pay the premium when payment is due; 
   
  (4) an increase in hazard for which the insured seeks coverage that results 
from an action or omission of the employer, and that would produce an increase 
in the rate, including an increase because of a failure to comply with 
reasonable recommendations for loss control, or to comply within a reasonable 
period with recommendations designed to reduce a hazard that is under the 
employer's control; and 
   
  (5) determination by the Commissioner of Insurance that the continuation of 
the policy would be in violation of the law, or would be hazardous to the 
interest of subscribers, creditors, or the general public. 
     
  (e) Insurance coverage remains in effect until the notice required by this 
section is given to the Texas Department of Insurance and the employer. The 
effective date of any subsequent policy is deemed to be the cancellation date of 
the previous policy. 
 
     
  sec.5.6704. Employer Filing Required for Non-Coverage, 
 
  (a) Each employer who employs one or more employees, and who does not have 
workers' compensation insurance coverage shall notify the Texas Department of 
Insurance. An employer whose employees are exempted from the Texas Workers' 
Compensation Act, Article 8308, sec.3.10, is exempt from this section. 
   
  (b) The notice shall be in writing, on TDI Form 5, Employer Notice of Non-
Coverage or Termination of Coverage, and shall contain the following 
information: 
 
  (1) employer's name, business address, and FEIN; 
   
  (2) business location(s) of employer's business operations, inception date of 
business, and the number of employees at each business location; 
   
  (3) description of employer's business operations for each business; 
   
  (4) name, title, and signature of the person providing the information; and, 
   
  (5) date the TDI Form 5 was completed. 
     
  (c) Supplemental TDI Form 5-1, Location of Employer's Business(es), shall be 
attached, as necessary, to the notice required by this section. 
   
  (d) The notice shall be filed annually with the Texas Department of Insurance 
within 30 days of the anniversary date of the inception of business, or the 
anniversary date of cancellation of the last workers' compensation insurance 
policy, whichever is later. 
   
  (e) An employer who fails to comply with this section commits a Class D 
administrative violation, in accordance with the Texas Workers' Compensation 
Act, Article 8308, sec.3.22, and may be assessed an administrative penalty by 
the Texas Workers' Compensation Commission, not to exceed $500 for each day of 
non-compliance. 
 
     
  sec.5.6705. Employer Termination of Workers' Compensation Insurance. 
 
  (a) Each employer who terminates workers' compensation insurance coverage 
shall notify the Texas Department of Insurance that the employer has terminated 
such coverage. 
   
  (b) The notice shall be in writing, on TDI Form 5, Employer Notice of Non-
Coverage/Termination, and shall contain the following information: 
 
  (1) employer's name, business address, and federal tax identification number; 
   
  (2) inception date of business, and the number of employees at each business 
location; 
   
  (3) description of the employer's business operation; 
   
  (4) effective date of termination of workers' compensation insurance policy 
coverage; 
   
  (5) name of insurance company, policy number, and effective dates of policy; 
   
  (6) date the employer notified the carrier to terminate policy; 
   
  (7) date the employer requested cancellation to be effective; 
   
  (8) date the notice of termination was provided, or will be provided, to 
employees; 
   
  (9) name, title, and signature of the person providing the information; and, 
   
  (10) date TDI Form 5 was completed. 
     
  (c) The effective date of termination of workers' compensation insurance 
coverage shall be the later of: 
 
  (1) 30 days after filing of TDI Form 5, Employer Notice of Non-
Coverage/Termination with the Texas Department of Insurance; or 
   
  (2) the cancellation date of the policy. 
     
  (d) The employer is obligated to pay premiums which accrue during the period 
contained in subsection (c) of this section. 
   
  (e) The notice shall be filed with the Texas Department of Insurance, by 
certified mail, within 10 days of the employer's notice to the insurance carrier 
to terminate workers' compensation insurance coverage. 
 
     
  sec.5.6706. Self-Insured Governmental Entity-Notice of Insurance, Change of 
Insurance Company or Renewal of Coverage. 
 
  (a) A governmental entity means a county, home-rule city, a city, town, or 
village organized under the general laws of this state, a special district, a 
school district, a junior college district, a housing authority, a community 
center for mental health and mental retardation services established under Texas 
Mental Health and Mental Retardation Act, Article 3, or any other legally 
constituted political subdivision of the state, as authorized to self-insure for 
workers' compensation insurance pursuant to Texas Civil Statutes, Article 8309h. 
   
  (b) A governmental entity shall file notice of either self-insurance or 
workers' compensation coverage with the Texas Department of Insurance. 
   
  (c) The notice shall be in writing, on TDI Form 20-3, Self-Insured 
Governmental Entity-Notice of Coverage, and shall contain the following 
information: 
 
  (1) employer/insured name, business address, federal employer identification 
number (FEIN), and nature of business; 
   
  (2) number of employees; 
   
  (3) employer's workers' compensation governing classification code, assigned 
by Texas Department of Insurance and occupation, if insured; 
   
  (4) name of servicing contractor, FEIN, and policy number/contract certificate 
number; 
   
  (5) effective date of policy/contract; and 
   
  (6) name and signature of insurance company/servicing contractor 
representative (person completing form), and date of notice. 
     
  (d) The information required by subsection (b) of this section shall be filed 
by the governmental entity with the Texas Department of Insurance by certified 
mail, or in person, within 10 days after any of the following: 
 
  (1) the effective date of self-insurance or workers' compensation coverage; 
   
  (2) a change in insurance company acting as the servicing contractor; and 
   
  (3) the formation of the governmental entity, and thereafter, annually. 
     
  (e) A servicing contractor or self-insuring governmental entity that fails to 
comply with this rule commits a Class C administrative violation under the Texas 
Workers' Compensation Act, Article 8308, sec.3.25, and Article 8309h, and may be 
assessed an administrative penalty, not to exceed $1,000 for each day of non-
compliance by the Texas Workers' Compensation Commission. 
 
     
  sec.5.6707. Incorporation by Reference. TDI Form 5 (Employer Notice of Non-
Coverage of Termination of Coverage), Form 5-1 (Location of Employer's 
Business(es)), Form 20 (Insurance Company Notice of Coverage/Cancellation/Non-
Renewal), Form 20-1 (Also Known As), Form 20-2 (Location of Employer's 
Business(es)), and Form 20-3 (Self-Insured Governmental Entity), the use of 
which is required in these sections, are adopted by reference, and have been 
filed with the Office of the Secretary of State. Copies of the adopted rules and 
forms may be obtained from Robert A. Hefford, Director, Research and Special 
Projects, Workers' Compensation Division, Mail Code 202-1A, Texas Department of 
Insurance, P.O. Box 149092, Austin, Texas 78714-9092. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 14, 1992. 
 TRD-9213887 
  Linda K. von Quintus-Dorn 
 Chief Clerk 
 Texas Department of Insurance 
    Effective date: November 4, 1992 
 Proposal publication date: July 21, 1992 
 For further information, please call:(512) 463-6327 
         
                   
  TITLE 31. NATURAL RESOURCES AND CONSERVATION 
 Part II. Texas Parks and Wildlife Department 
  Chapter 65. Wildlife 
  
  Subchapter H. Type I Wildlife Management Areas, Hunting and Fishing 
 
  31 TAC sec.sec.65.190, 65.193, 65.194 
 
  The Texas Parks and Wildlife Department adopts amendments to sec.sec.65.190, 
65.193, and 65.194, concerning the Type I Wildlife Management Areas Hunting and 
Fishing Proclamation, without changes to the proposed text as published in the 
July 24, 1992, issue of the Texas Register  (17 TexReg 5183). 
 The amendments as adopted were necessary to add one new area, establish 
regulations governing public use of the new area, and eliminate a conflict in 
permit requirements for fishing on an existing area. 
 The adopted rules provide for harvest of wildlife resources consistent with 
recognized wildlife management tenets. 
 No comments were received regarding adoption of the amendments. 
 The amendments are adopted under the Texas Parks and Wildlife Code, Chapter 81, 
Subchapter E, which provides the Texas Parks and Wildlife Commission with 
authority to regulate seasons, number, means, methods, and conditions, for 
taking wildlife resources on wildlife management areas. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213855 
  Paul M. Shinkawa 
 Director, Legal Services 
 Texas Parks and Wildlife Department 
    Effective date: November 3, 1992 
 Proposal publication date: July 24, 1992 
 For further information, please call: 1 (800) 792-1112, extension 4433 or (512) 
389-4433 
         
               
  TITLE 40. Social Services and Assistance 
 Part I. Texas Department of Human Services 
  Chapter 9. Refugee Social Services 
  
  Subchapter A. Program Purpose and Scope 
 
  The Texas Department of Human Services (DHS) adopts the repeal of sec.sec.9. 
101, 9.201-9.204, 9.301-9.303, 9.401-9.405, 9.501, and 9.502, concerning program 
purpose and scope, without changes to the proposed text as published in the 
September 8, 1992, issue of the Texas Register (17 TexReg 6180). 
 The justification for the repeals, which constitute all of DHS's Chapter 9, 
Refugee Social Services, is to transfer administration of the Refugee Social 
Services Program to the Office of the Governor as directed by the 72nd Texas 
Legislature. 
 The repeals will function by deleting rules for a program DHS no longer 
administers. 
 No comments were received regarding adoption of the repeals. 
   
  40 TAC sec.9.101 
 
  The repeal is adopted under the Human Resources Code, Title 2, Chapters 22 and 
32, which provides the department with the authority to administer public and 
medical assistance programs. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 14, 1992. 
 TRD-9213890 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 4, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
         
  Subchapter B. Client Information 
 
  40 TAC sec.sec.9.201-9.204 
 
  The repeals are adopted under the Human Resources Code, Title 2, Chapters 22 
and 32, which provides the department with the authority to administer public 
and medical assistance programs. 
 
 
  sec.9.201. Client Eligibility. 
 
   
  sec.9.202. Redetermination of Client Eligibility. 
 
   
  sec.9.203. Client Rights. 
 
   
  sec.9.204. Client Priority Groups. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 14, 1992. 
 TRD-9213891 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 4, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
           
  Subchapter C. Contractor Requirements 
 
  40 TAC sec.sec.9.301-9.303 
 
  The repeals are adopted under the Human Resources Code, Title 2, Chapters 22 
and 32, which provides the department with the authority to administer public 
and medical assistance programs. 
 
 
  sec.9.301. Contractor Requirements. 
 
   
  sec.9.302. Accounting Requirements. 
 
   
  sec.9.303. Reimbursement for Services. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 14, 1992 
 TRD-9213892 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 4, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
           
  Subchapter D. Service Requirements 
 
  40 TAC sec.sec.9.401-9.405 
 
  The repeals are adopted under the Human Resources Code, Title 2, Chapters 22 
and 32, which provides the department with the authority to administer public 
and medical assistance programs. 
 
 
  sec.9.401. Core Services. 
 
   
  sec.9.402. Mandated Support Services. 
 
   
  sec.9.403. Optional Support Services. 
 
   
  sec.9.404. General Service Requirements. 
 
   
  sec.9.405. Core Services Requirements. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 14, 1992. 
 TRD-9213893 
  Nancy Murphye 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 4, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
           
  Subchapter E. Work Registration Requirements 
 
  40 TAC sec.9.501, sec.9.502 
 
  The repeals are adopted under the Human Resources Code, Title 2, Chapters 22 
and 32, which provides the department with the authority to administer public 
and medical assistance programs. 
 
 
  sec.9.501. Work Registration Requirements. 
 
   
  sec.9.502. Work Registration Referrals from the Texas Employment Commission. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 14, 1992. 
 TRD-9213894 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 4, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
             Chapter 39. Medical Transportation 
  
  Program Overview 
 
  The Texas Department of Human Services (DHS) adopts the repeal of 
sec.sec.39.1, 39.102-39.107, 39.201, 39.202, 39.301, 39.302, 39.401, 39.403-
39.407, 39.501, 39.503, 39.601, and 39.602; new sec.sec.39.1, 39. 102-39.105, 
39.201, 39.202, 39.301, 39.302, 39.304, 39.305, 39.401, 39.405-39. 407, 39.501, 
39.503, 39.601, and 39.602; and amendments to sec.sec.39.101, 39. 303, 39.402, 
39.408, 39.502, and 39.1002. New sec.sec.39.103, 39.105, 39.202, and 39.301 are 
adopted with changes to the proposed text as published in the September 8, 1992, 
issue of the Texas Register (17 TexReg 6181). The repeal of sec.sec.39.1, 
39.102-39.107, 39.201, 39.202, 39.301, 39.302, 39.401, 39.403-39.407, 39.501, 
39.503, 39.601, and 39.602; new sec.sec.39.1, 39.102, 39. 104, 39.201, 39.302, 
39.304, 39.305, 39.401, 39.405-39.407, 39.501, 39.503, 39. 601, and 39.602; and 
amendments to sec.sec.39.101, 39.303, 39.402, 39.408, 39. 502, and 39.1002 are 
adopted without changes, and will not be republished. 
 The repeals, amendments, and new sections are justified to improve the 
efficiency of medical transportation services. 
 The amendments and new sections will function by clarifying the policies for 
the operation of the Medical Transportation Program. 
 No comments were received regarding adoption of the repeals, amendments, and 
new sections. DHS, however, is adopting several new sections with minor changes 
needed to make the sections clearer. In sec.39.103, DHS has separated the text 
proposed in subsection (d) into two subsections and has added the words "mass 
transit" to subsection (e) to clarify the type of transportation being 
described. An editorial change has been made to sec.39.105(a). The change to 
sec.39.105(e)(5) adds the words "that is not based on a circumstance beyond the 
client's control" to clarify when warning notices are sent. The changes to 
sec.39.202(1) and (8) add the words "who may be eligible for meals and lodging" 
to paragraph (1) and insert several words in paragraph (8) to clarify the 
reimbursement exceptions to clients, attendants, and individual providers. The 
change to sec.39.301(a)(3) deletes paragraph (3) and renumbers the subsequent 
paragraphs in that subsection to clarify participation requirements for 
contracted primary providers. 
   
  40 TAC sec.39.1 
 
  The repeal is adopted under the Human Resources Code, Title 2, Chapters 22 and 
32, which provides the department with the authority to administer public and 
medical assistance programs. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213817 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
       
  40 TAC sec.39.1 
 
  The new section is adopted under the Human Resources Code, Title 2, Chapters 
22 and 32, which provides the department with the authority to administer public 
and medical assistance programs. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213818 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
       
  40 TAC sec.sec.39.102-39.105 
 
  The amendment and new sections are adopted under the Human Resources Code, 
Title 2, Chapters 22 and 32, which provides the department with the authority to 
administer public and medical assistance programs. 
 
 
  sec.39.103. Trip Eligibility Criteria. 
 
  (a) Eligible clients must receive the most cost-effective transportation 
available, that does not endanger their health, to the nearest facilities for 
accessible and appropriate Medicaid-allowable medical services. This includes 
medical facilities in the United States that are across the Texas state line. 
   
  (b)  A client may request and receive transportation to a more distant 
facility for Medicaid-covered services if the facility will not bill Medicaid 
for the cost of medical services. 
   
  (c) Clients who request out-of-state transportation to medical facilities must 
have a physician submit the Texas Department of Human Services' (DHS's) 
physician's statement of medical need form to DHS's health insuring agent. The 
physician must request prior approval for payment of medical treatment for the 
client and state the client's need for out-of-state transportation. 
   
  (d) Clients who request transportation by common carrier must obtain 
authorization from Medical Transportation Program staff before the trip. 
   
  (e) Clients who receive mass transit bus tickets or tokens must complete DHS's 
medical services verification form to prove that the tickets or tokens were used 
for appropriate medical services. Clients must return this verification form 
before additional tickets or tokens are issued. 
 
     
  sec.39.105. Client Rights. 
 
  (a) Nondiscrimination. Clients have a right to receive services in compliance 
with Title VI of the Civil Rights Act of 1964 (Public Law 88-352); the 
Rehabilitation Act of 1973, sec.504 (Public Law 93-112); the Americans with 
Disabilities Act of 1990 (Public Law 101-336); Chapter 73 of this title 
(relating to Civil Rights); and all amendments to each, and all requirements 
imposed by the regulations issued pursuant to these Acts. These Acts provide, in 
part, that no person in the United States will, on the grounds of race, color, 
national origin, age, sex, disability, political beliefs, or religion be 
excluded from participation in, or be denied, any aid, care, service, or other 
benefits provided by federal and/or state funding, or otherwise be subjected to 
any discrimination. In addition, the contractor agrees to comply with the Health 
and Safety Code, sec.85.113 (concerning workplace and confidentiality guidelines 
regarding AIDS and HIV). 
   
  (b) Abuse report. Clients may report physical abuse or sexual harassment by 
other clients or transportation drivers to Medical Transportation Program (MTP) 
staff on the Texas Department of Human Services' (DHS's) report of physical or 
sexual abuse form. 
   
  (c) Confidentiality. DHS protects confidential case information about the 
client. The contracted provider and DHS consider all client-specific information 
as confidential, regardless of whether the information is collected by DHS or 
contracted provider agencies. 
   
  (d) Denial notifications. MTP staff notify current Medicaid recipients in 
writing of specific trip denials if the recipients: 
 
  (1) have other means of transportation; 
   
  (2) request transportation services to a medical service that could be 
provided closer to the trip origin; or 
   
  (3) request transportation for medical services that are not Medicaid-
allowable. 
     
  (e) Warning notice. MTP staff send warning notices to clients of their six-
month suspension from medical transportation services before suspending them. 
Warning notices are sent to a client for the following reasons involving the 
client and/or his attendant: 
 
  (1) one validated incident of physical abuse to another client, contracted 
provider's employee, or DHS employee while receiving medical transportation 
services; 
   
  (2) one validated incident of verbal or physical sexual harassment toward 
another client, contracted provider's employee, or DHS employee while requesting 
or receiving medical transportation services; 
   
  (3) one validated incident of the client losing bus tickets or tokens sent to 
the client for his and his attendant's requested medical transportation services 
that is not a circumstance beyond the client's control; 
   
  (4) one validated incident of premeditated use of authorized medical 
transportation for purposes other than to receive Medicaid-allowable medical 
services; 
   
  (5) one validated incident of the client not contacting MTP staff to cancel a 
trip in time to allow notification to the provider of the trip cancellation that 
is not based on a circumstance beyond the client's control; 
   
  (6) one validated incident of no show or trip refusal that is not based on a 
circumstance beyond the client's control; or 
   
  (7)  failure to return a completed DHS medical services verification form 
verifying that authorized trips were taken before requesting additional bus 
tickets or tokens for more medical transportation services. 
     
  (f)  Suspension. If a second incident for which the client and/or attendant 
was warned is validated within six months from the time that the warning was 
mailed, the client and/or attendant will be suspended from receiving MTP 
services for six months. If the temporary suspension was received for not 
verifying authorized trips, that temporary suspension is removed effective the 
date that a completed DHS medical services verification form is received by MTP 
staff. 
   
  (g) Appeal request. A client or his responsible party may request orally or in 
writing a fair hearing, as specified in Chapter 79 of this Title (relating to 
Legal Services), to appeal any decision resulting in his or her ineligibility 
for services or temporary suspension of services. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213820 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
             
  Eligibility for Program Services 
 
  40 TAC sec.sec.39.102-39.107 
 
  The repeals are adopted under the Human Resources Code, Title 2, Chapters 22 
and 32, which provides the department with the authority to administer public 
and medical assistance programs. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213819 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
         
  Program Services Limitations 
 
  40 TAC sec.39.201, sec.39.202 
 
  The repeals are adopted under the Human Resources Code, Title 2, Chapters 22 
and 32, which provides the department with the authority to administer public 
and medical assistance programs. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213821 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
       
  40 TAC sec.39.201, sec.39.202 
 
  The new sections are adopted under the Human Resources Code, Title 2, Chapters 
22 and 32, which provides the department with the authority to administer public 
and medical assistance programs. 
 
 
  sec.39.202. Program Exclusions. The following services are not available under 
the Medical Transportation Program (MTP): 
 
  (1)  reimbursement of meals, lodging, child care, or any other personal 
expenses for clients or attendants, except for Medicaid recipients ages birth to 
21 years old who may be eligible for meals and lodging under the Comprehensive 
Care Program of Early and Periodic Screening, Diagnosis, and Treatment (EPSDT); 
   
  (2) passenger assistance beyond that which is necessary to ensure that clients 
enter and leave from vehicles safely, unless the provider's contract states that 
door-to-door service is provided; 
   
  (3)  medical care while clients are being transported; 
   
  (4)  transportation of deceased clients; 
   
  (5) ambulance services; 
   
  (6) Medicaid service that exceeds the amount, duration, and scope, as 
specified in the Texas Department of Human Services' (DHS's) Medicaid Provider 
Procedures Manual; 
   
  (7) services not allowed under Medicaid; and 
   
  (8) reimbursement for transportation services provided by individual providers 
before the date that MTP staff received the initial request to provide services 
from the individual provider. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213833 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
             
  Provider Participation 
 
  40 TAC sec.39.301, sec.39.302 
 
  The repeals are adopted under the Human Resources Code, Title 2, Chapters 22 
and 32, which provides the department with the authority to administer public 
and medical assistance programs. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213822 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
       
  40 TAC sec.sec.39.301-39.305 
 
  The new sections and amendment are adopted under the Human Resources Code, 
Title 2, Chapters 22 and 32, which provides the department with the authority to 
administer public and medical assistance programs. 
 
 
  sec.39.301. Participation Requirements. 
 
  (a) To participate in the Medical Transportation Program (MTP) all contracted 
primary providers and/or their subcontractors must: 
 
  (1) comply with applicable local, state, and federal laws and regulations 
regarding provisions of transportation services, as well as Texas Department of 
Human Services (DHS) rules, policies, procedures, guidelines, and their contract 
with DHS; 
   
  (2) comply with Title VI of the Civil Rights Act of 1964 (Public Law 88-352); 
the Rehabilitation Act of 1973, sec.504 (Public Law 93-112); the Americans with 
Disabilities Act of 1990 (Public Law 101-336); Chapter 73 of this title 
(relating to Civil Rights) and all amendments to each, and all requirements 
imposed by the regulations issued pursuant to these Acts. These Acts provide, in 
part, that no persons in the United States shall on the grounds of race, color, 
national origin, age, sex, disability, political beliefs, or religion be 
excluded from participation in, or be denied, any aid, care, service, or other 
benefits provided by federal and/or state funding, or otherwise be subjected to 
any discrimination. In addition, the contractor agrees to comply with the Health 
and Safety Code, sec.85.113 (concerning workplace and confidentiality guidelines 
regarding AIDS and HIV); 
   
  (3) provide routine one-way trips authorized by MTP staff when received at 
least the day before the client's appointment time. 
   
  (4) ensure that priority trips, as determined by MTP staff, are provided on 
the original authorized date which could include same-day service; 
   
  (5) ensure that a routine trip is not rescheduled for the same client more 
than once before the trip is provided; 
   
  (6) use drivers who meet federal, state, and local government requirements for 
safe operation of vehicles they drive. 
   
  (7) ensure that clients are delivered to appointments on time. The provider 
must return within one hour of the client-requested or provider-specified time, 
which must be before the medical facility closes. A provider must wait five 
minutes before leaving without a client who has failed to be at the appointed 
pick-up site on time and contact MTP staff using the toll-free number provided 
in the contract; 
   
  (8) use clean vehicles that meet federal, state, and local government 
requirements for safe operation; 
   
  (9) ensure that liability insurance is current. If a provider's liability 
insurance is canceled, the provider must not transport any client and must 
contact the MTP contract manager immediately; 
   
  (10) ensure that drivers have not received citations for more than two moving 
violations while on or off the job for the past 12 months. During on-site 
visits, the contractor will furnish verification of Texas Department of Public 
Safety driving records of the drivers employed; 
   
  (11) ensure that drivers are considerate of the comfort of the clients and 
make rest stops as needed; 
   
  (12) ensure that all drivers and passengers observe the Texas safety belt law 
for automobiles, except on mass transit buses and air and surface common 
carriers. Children under two years old must use child safety seats that are 
manufactured according to federal standards, and children who are two years old 
or older must use safety belts. Additional details are specified in Texas Civil 
Statutes, Article 6701d 107c; 
   
  (13) ensure that all drivers receive appropriate training as specified in 
their contract with DHS. Documentation of this training must be maintained in 
the facility's records and available for review upon request by the MTP contract 
manager; 
   
  (14) provide passenger assistance necessary to ensure that clients enter and 
exit vehicles safely. If a contract specifies door-to-door services, the 
passenger is assisted to and from the doors at the trip origin and destination; 
   
  (15)  ensure, as specified in the contract, that MTP staff are made aware of 
cancellations, no shows by client or driver, and trip refusals; 
   
  (16)  ensure that contracted provider staff identify themselves when talking 
to clients concerning trips authorized by MTP staff. 
     
  (b) Individual providers must sign an individual provider agreement with DHS 
to acquire participation status. DHS may reject any request for participation in 
the MTP and cancel any existing agreement. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213823 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
             
  Payment Procedures and Recordkeeping 
 
  40 TAC sec.sec.39.401, 39.403-39.407 
 
  The repeals are adopted under the Human Resources Code, Title 2, Chapters 22 
and 32, which provides the department with the authority to administer public 
and medical assistance programs. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213824 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
       
  40 TAC sec.sec.39.401, 39.402, 39.405-39.408 
 
  The new sections and amendments are adopted under the Human Resources Code, 
Title 2, Chapters 22 and 32, which provides the department with the authority to 
administer public and medical assistance programs. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213825 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
         
  Monitoring and Evaluation 
 
  40 TAC sec.39.501, sec.39.503 
 
  The repeals are adopted under the Human Resources Code, Title 2, Chapters 22 
and 32, which provides the department with the authority to administer public 
and medical assistance programs. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213826 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
       
  40 TAC sec.sec.39.501-39.503 
 
  The new sections and amendment are adopted under the Human Resources Code, 
Title 2, Chapters 22 and 32, which provides the department with the authority to 
administer public and medical assistance programs. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213827 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
         
  Contract Termination and Expiration 
 
  40 TAC sec.39.601, sec.39.602 
 
  The repeals are adopted under the Human Resources Code, Title 2, Chapters 22 
and 32, which provides the department with the authority to administer public 
and medical assistance programs. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213828 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
       
  40 TAC sec.39.601, sec.39.602 
 
  The new sections are adopted under the Human Resources Code, Title 2, Chapters 
22 and 32, which provides the department with the authority to administer public 
and medical assistance programs. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213829 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
         
  Transportation Services for Indigent Cancer Patients 
 
  40 TAC sec.39.1002 
 
  The amendment is adopted under the Human Resources Code, Title 2, Chapters 22 
and 32, which provides the department with the authority to administer public 
and medical assistance programs. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213830 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
         Chapter 48. Community Care for Aged and Disabled 
  
  Eligibility 
 
  40 TAC sec.48.2911, sec.48.2918 
 
  The Texas Department of Human Services (DHS) adopts amendments to sec.48. 2911 
and sec.48.2918 concerning eligibility, without changes to the proposed text as 
published in the September 8, 1992, issue of the Texas Register (17 TexReg 
6189). 
 The justification for the amendments is to continue into the next fiscal year 
the increase in the maximum number of hours per week a client can receive family 
care and primary home care services. 
 The amendment will function by assisting individuals who need additional hours 
of service to remain in the community. 
 No comments were received regarding adoption of the amendments. 
 The amendments are adopted under the Human Resources Code, Title 2, Chapters 22 
and 32, which provides the department with the authority to administer public 
and medical assistance programs. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 14, 1992. 
 TRD-9213895 
  Nancy Murphy 
 Agency Liaison, Policy and Document Support 
 Texas Department of Human Services 
    Effective date: November 15, 1992 
 Proposal publication date: September 8, 1992 
 For further information, please call: (512) 450-3765 
         
             Part IX. Texas Department on Aging 
  Chapter 253. State Aging Plan 
  
   40 TAC sec.253.3 
 
  The Texas Department on Aging adopts new sec.253.3 concerning funding 
allocation formula for Older Americans Act, Title III programs and area agencies 
on aging with changes to the proposed text as published in the August 7, 1992, 
issue of the Texas Register (17 TexReg 59). 
 Action is promulgated under federal mandate in the Older Americans Act, as 
amended, sec.305 (a)(2)(C), requiring states to publish and receive comments on 
the formula for distribution of federal funding to local area agencies on aging. 
The change to the text of sec.253.3 (e)(3) deleted the statement indicating that 
the 50% weight assigned to the factor for below the poverty level was twice the 
weight of the each of the other two factors because it is mathematically 
incorrect. 
 This section will function as the procedure for calculating the intrastate 
distribution of funding appropriated under the Older Americans Act, as amended. 
 The department received public comments on the proposed section. Those in 
support of the proposed intrastate funding formula stated that the formula would 
provide balanced funding for both the social and economic needs of Texas's 
elderly citizens. In addition, two individuals stated that the phase-in of the 
proposed formula would minimize disruption of current services and programs. One 
individual indicated no position on the proposed formula, but stated 
appreciation to the Texas Department on Aging for the opportunity to participate 
in the process of determining the formula. Those in opposition to the proposed 
intrastate funding formula stated their concern that the formula would not place 
enough funding emphasis on the social and economic needs of low-income minority 
elderly Texans. 
 Names of groups and associations making comments for the proposed section were 
Central Texas Council of Governments; Dallas Area Agency on Aging Advisory 
Council; Hill Country Transit; Parker County Committee on Aging; State 
Representative, District 13; State Representative, District 53; State 
Representative, District 54; State Representative, District 24; Hamilton County 
Judge; Bell County Judge; Mills County Judge; San Saba County Judge; Lampasas 
County Judge; Milam County Judge; and Coryell County Judge. 
 Names of groups and associations making comments against the proposed section 
Middle Rio Grande Development Council; Rio Grande Council of Governments; State 
Senator, District 21; and State Representative-elect, District 43. 
 The Texas Board acknowledged that the federal funds allocated to the state were 
insufficient to meet the increasing need for services across Texas. The board 
did believe the revised formula reflected increased emphasis on the populations 
in poverty. Low income minority were represented in all three factors within the 
formula-total population aged 60 and over, total population aged 60 and over who 
are minorities, and total population aged 60 and over who are living on incomes 
below the poverty level. 
 The new section is adopted under the Human Resources Code, Chapter 101, which 
provides the Texas Department on Aging with the authority to promulgate rules 
governing the operations of this department. 
 
 
  sec.253.3. Funding Allocation Formula for Title III Programs and Area Agencies 
on Aging. 
 
  (a) Goal of the formula. The goal of this formula is to distribute Title III 
Funding in an equitable manner based upon the most recent census information; 
and in so doing clearly follow the intent of the Older Americans Act of 1965, as 
amended, and related federal regulations which emphasize addressing the needs of 
those "in greatest economic or social need with particular attention to low-
income minority individuals" (45 Code of Federal Regulations sec.1321.37(a)). 
   
  (b) Area agency on aging administration funds. An area agency on aging 
administration pool from which each area agency would be allocated no less than 
$85,000. The administration pool is composed of 10% of the federal allocation of 
funds to area agencies on aging. 
 
  (1) Allocation of all the administration funds from the administration pool is 
computed according to the following formula of weighted factors: 
 
  (A) total population aged 60 and over, weighted at 40%; 
   
  (B) total population aged 60 and over who are minorities, weighted at 10%; 
and, 
   
  (C) total population aged 60 and over who are living on incomes below the 
poverty level, weighted at 50%. 
     
  (2) For each factor, the number of persons in each area agency on aging 
region, based on the official 1990 Census data, is established as a percent of 
that factor for the State of Texas and weighted as shown to determine the 
overall proportion of the funding that will be allocated to each area agency on 
aging. For the administration funds, this proportion is applied to the 
administration funds pool, then adjustments are made proportionately so that no 
area agency on aging receives an allotment of less than $85,000 for 
administration. 
     
  (c) Supportive and nutrition services funds. Each area agency on aging will be 
awarded Title III funding for services in accordance with the Older Americans 
Act as amended, sec.305(a)(2)(C), in the following manner. 
 
  (1) A base amount of $100,000 for Title III Supportive Services and a base 
amount of $100,000 of Title III Nutrition Services funding. 
   
  (2) Allocation of the remaining service dollars is computed according to the 
following formula of weighted factors: 
 
  (A) total population aged 60 and over, weighted at 40%; 
   
  (B) total population aged 60 and over who are minorities, weighted at 10%; and 
   
  (C) total population aged 60 and over who are living on incomes below the 
poverty level, weighted at 50%. 
     
  (3) For each factor, the number of persons in each area agency region, based 
on the 1990 official Census data, is established as a percent of that factor for 
the State of Texas and weighted as shown to determine the overall proportion of 
the funding that will be allocated to each area agency on aging. 
     
  (d) Phase-in for implementation of formula. The funding changes for each 
region, resulting from the above stated formula, will be phased into use over a 
two year period. One-half of the resulting funding changes (increases and 
decreases) take effect in fiscal year 1993 and the remaining one-half of the 
resulting changes to be implemented in fiscal year 1994 awards. 
   
  (e) Formula assumptions. The assumptions used in selecting the formula 
elements and their respective weights are as follows. 
 
  (1) Some portion of the funds distribution should be based upon the population 
of all individuals age 60 and over within a PSA, since the Older Americans Act 
(OAA) is designed for all persons age 60 and over regardless of other 
characteristics. However, due to the emphasis of the OAA and regulations on 
subgroups within this population, it should not be the largest factor, hence 
40%. 
   
  (2) The OAA defines greatest social need as "the need caused by non-economic 
factors which include physical and mental disabilities, language barriers, and 
cultural, social, or geographic isolation including that caused by racial or 
ethnic status which restricts an individual's ability to perform normal daily 
tasks or which threatens such individual's capacity to live independently," (OAA 
302(21)). The use of the age 60 and over minority population statistic addresses 
this emphasis. However, this factor, by itself, is not the most important, hence 
10%. 
   
  (3) The OAA defines greatest economic need as "the need resulting from an 
income level at or below the poverty levels established by the Office of 
Management and Budget", (OAA 302(20)). Significant portions of the low income 
elderly population are minorities and/or live in isolated areas. In addition, 
there is a strong correlation between income and an individual's health, and 
access to health care. Therefore, the low income component addresses not only 
those individuals with "greatest economic need," but also factors defining 
"greatest social need" as quoted above. (Studies supporting this conclusion 
include: "Income and Poverty Trends for the Elderly" Cynthia M. Tauber, M.A., 
Bureau of the Census, United States Department of Commerce, March 26, 1992; and 
"Health Care Financing Among the Elderly: Who Really Pays the Bills?", T. M. 
Smeeding and L. Straub, published in the Journal of Health Politics, Policy and 
Law 12 (1, Spring) 1987). In addition, the elements described under paragraphs 
(2) and (3) above address the stipulation in the OAA for "particular attention 
to low income minority individuals." 
   
  (4) The formula should provide for a minimum amount to each PSA for the 
administration of the programs and a minimum amount for the provision of 
services within each PSA. The OAA, Section 304, provides for minimum allotments 
to states. It makes sense to do the same for each PSA. 
   
  (5) The following is a demonstration of the allocation of funds by PSA using 
this proposed formula and the FY1992 Title III Funding figures. 
 
  [graphic] 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213810 
  Mary Sapp 
 Executive Director 
 Texas Department on Aging 
    Effective date: November 3, 1992 
 Proposal publication date: August 7, 1992 
 For further information, please call: (512) 444-2727 
         
               Chapter 255. Designation of Area Agencies on Aging 
  
  40 TAC sec.255.38 
 
  The Texas Department on Aging adopts the repeal of sec.255.38 concerning 
funding allocation formula for Title III Programs and area agencies on aging, 
without changes to the proposed text as published in the June 26, 1992, issue of 
the Texas Register (17 TexReg 48). 
 This section is repealed and the intrastate funding allocation formula has been 
moved from the chapter for designation of area agencies on aging to a more 
appropriate chapter. Because the Older Americans Act requires the state unit on 
aging to include the intrastate funding allocation formula in the state plan, 
rules for this formula are placed in Chapter 253, state aging plan, sec.253.3, 
funding allocation formula for Title III Programs and area agencies on aging 
 Repeal of this section and placing the funding allocation formula in a more 
appropriate section will ensure that the section contains only those rules 
pertaining to the designation of the area agencies on aging. 
 No comments were received regarding adoption of the repeal. 
 The section is repealed under the Human Resources Code, Chapter 101, which 
provides the Texas Department on Aging with the authority to promulgate rules 
governing the operations of this department. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on October 13, 1992. 
 TRD-9213811 
  Mary Sapp 
 Executive Director 
 Texas Department on Aging 
    Effective date: November 3, 1992 
 Proposal publication date: June 26, 1992 
 For further information, please call: (512) 444-2727