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 II. Texas Ethics Commission Chapter 10. Practice and Procedure Subchapter A. General Provisions 1 TAC sec.sec.10.1, 10.3, 10.5, 10.7, 10.9, 10.11, 10.13, 10.15, 10.17, 10.19, 10.21, 10.23, 10.25, 10.27, 10.29, 10.31, 10.33, 10.35, 10.37, 10.39, 10.41, 10.43 The Texas Ethics Commission adopts new sec.sec.10.1, 10.3, 10.5, 10.7, 10.9, 10.11, 10.13, 10.15, 10.17, 10.19, 10.21, 10.23, 10.25, 10.27, 10.29, 10.31, 10.33, 10.35, 10.37, 10.39, 10.41, and 10.43. Section 10.31 is adopted with changes to the proposed text as published in the November 3, 1992, issue of the Texas Register (17 TexReg 7729). The remaining sections are adopted without changes and will not be republished. These sections set forth the rules and procedure concerning the filing of complaints alleging violations of statutes, and rules and regulations administered by the Texas Ethics Commission. The changes resulted from recommendations made during a public hearing on December 10, 1992. These sections will provide the public with guidelines and necessary requirements to effectuate the filing of a complaint with the commission during the sworn complaint process. As to new sec.10.31, the changes included removing the word "non" from "non-jury" and substituting the word "offer" for "other types of rebuttal." No comments were received regarding adoption of the new section. The new sections are adopted under Texas Civil Statutes, Article 6252-9d.1, which provide the Texas Ethics Commission with the authority to promulgate and adopt rules concerning the filing, processing, and resolution of complaints filed with the commission alleging violations of law, and rules and regulations administered by the commission. sec.10.31. Conduct of Hearings. (a) The rules of evidence and privilege as applied in jury civil cases in the district courts of this state shall be followed in the resolution of a sworn complaint, except that evidence not reasonably susceptible to proof under those rules may be admitted if of the type commonly relied upon by reasonably prudent people. (b) In a preliminary review hearing, informal hearing, or other type of resolution of a sworn complaint, a party may offer evidence, conduct cross- examination, or offer argument, and make opening and closing statements. (c) With notice to the parties, the commission or its delegate may take official notice of all facts judicially cognizable or generally recognized by the commission and its staff in the exercise of its 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 December 11, 1992. TRD-9216620 Jim Mathieson Assistant General Counsel Texas Ethics Commission Effective date: January 4, 1993 Proposal publication date: November 3, 1992 For further information, please call: (512) 463-5800 Part XII. Advisory Commission on State Emergency Communications Chapter 251. Regional Plans-Standards 1 TAC sec.251.4 The Advisory Commission on State Emergency Communications adopts new sec.251.4 concerning guidelines for the provisioning of ancillary equipment, without changes to the proposed text as published in the October 20, 1992, issue of the Texas Register (17 TexReg 7303). The guidelines will help clarify "ancillary equipment" which is required to help improve the effectiveness and reliability of 9-1-1 call delivery systems. The guidelines will be used for evaluating plan amendment requests for ancillary equipment. Commission will normally approve expenditures for call delivery and will continue to expect local governments to fund all activities related to provisions of emergency services. Comments were received from the Capital Area Planning Council to enhance their understanding of existing and proposed rules and ACSEC administrative procedures. The Capital Area Planning Council commented in favor 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 provide the Advisory Commission on State Emergency Communications with the authority to amend a regional plan for the establishment and operation of 9-1-1 service in accordance with standards and procedures as set by 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 December 14, 1992. TRD-9216684 Mark A. Boyd Executive Director Advisory Commission on State Emergency Communications Effective date: January 6, 1993 Proposal publication date: October 20, 1992 For further information, please call: (512) 327-1911 TITLE 4. AGRICULTURE Part I. Texas Department of Agriculture Chapter 28. Texas Agricultural Finance Authority: Loan Guaranty Program 4 TAC sec.sec.28.3, 28.7, 28.9 The Board of the Texas Agricultural Finance Authority of the Texas Department of Agriculture adopts amendments to sec. sec.28.3, 28.7, and 28.9, concerning Texas agricultural finance authority: loan guaranty program, without changes to the proposed text as published in the October 2, 1992, issue of the Texas Register (17 TexReg 6730). The amendments are adopted to clarify the types of projects that are eligible to participate in the Texas Agricultural Finance Authority Loan Guaranty Program. The amendments clarify what business and projects are eligible to participate in the program and what project costs may be covered by the loan. No comments were received regarding adoption of the amendments. The amendments are adopted under the Texas Agriculture Code, sec.58.022, which provides the board of the Texas Agricultural Finance Authority with the authority to adopt rules to establish rules and procedures for administration of the Texas Agricultural Finance Authority Loan Guaranty Program. 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 December 15, 1992. TRD-9216678 Dolores Alvarado Hibbs Chief Administrative Law Judge Texas Department of Agriculture Effective date: January 6, 1993 Proposal publication date: October 2, 1992 For further information, please call: (512) 463-7583 TITLE 10. COMMUNITY DEVELOPMENT Part I. Texas Department of Housing and Community Affairs Chapter 35. Taxable Multi-Family Mortgage Revenue Bond Program 10 TAC sec.sec.35.1-35.15 The Texas Department of Housing and Community Affairs (The Department) adopts new sec.sec.35.1-35.15, concerning taxable multifamily mortgage revenue bond program, without changes to the proposed text as published in the November 3, 1992, issue of the Texas Register (17 TexReg 7734). The proposed rules will establish the procedures by which the department will participate in the financing of new or existing multi-family rental properties for occupancy by persons or families of low or very low income and families of moderate income. The rules will establish the provision of long term fixed rate financing to create and preserve affordable rental housing units for occupancy by very low, and moderate income Texans. There will be no effect on small businesses. No comments were received regarding adoption of the new sections. The new sections are adopted under Texas Civil Statutes, Article 4413(501), sec.3.02(2), which provide the department with the authority to make rules governing the administration of the housing finance division of the department and its program. 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 December 15, 1992. TRD-9216681 Susan J. Leigh Executive Director Texas Department of Housing and Community Affairs Effective date: January 6, 1993 Proposal publication date: November 3, 1992 For further information, please call: (512) 475-3916 Chapter 39. Tax-Exempt Multi-Family Mortgage Revenue Bond Program 10 TAC sec.sec.39.1-39.17 The Texas Department of Housing and Community Affairs adopts new sec.sec.39. 1-39.17 concerning tax-exempt multi-family without changes to the proposed text as published in the November 3, 1992, issue of the Texas Register (17 TexReg 7741). The proposed rules will establish the procedures by which the department will participate in the financing of new or existing multi-family rental properties for occupancy by persons or families of low or very low income and families of moderate income. The rules will establish the provision of long term fixed rate financing to create and preserve affordable rental housing units for occupancy by very low, and moderate income Texans. There will be no effect on small businesses. No comments were received regarding adoption of the new section. The new sections are adopted under Texas Civil Statutes, Article 4413(501), sec.3.02(2), which provide the department with the authority to make rules governing the administration of the housing finance division of the department and its 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 December 15, 1992. TRD-9216682 Susan J. Leigh Executive Director Texas Department of Housing and Community Affairs Effective date: January 6, 1993 Proposal publication date: November 3, 1992 For further information, please call: (512) 475-3916 TITLE 16. ECONOMIC REGULATION Part I. Railroad Commission of Texas Chapter 7. Gas Utilities Division Substantive Rules 16 TAC sec.sec.7.70-7.72, 7.80-7.82, 7.84, 7.86 The Railroad Commission of Texas adopts amendments to sec. sec.7.70-7.72, 7. 80-7.82, 7.84, 7.86, and new sec.7.73, concerning minimum safety standards and regulations applicable to natural gas pipeline facilities and natural gas transportation within the State of Texas; the transportation of hazardous liquids within the State; and master meter systems. These proposals were published for public comment in the June 23, 1992, issue of the Texas Register (17 TexReg 4508); corrections were published in the July 10, 1992, issue of the Texas Register (17 TexReg 4981). Sections 7.70, 7.71, 7.82, 7.84, and 7.86 are adopted with changes to the proposed text as published in the June 23, 1992, issue of the Texas Register (17 TexReg 4508). Sections 7.72, 7.73, 7.80, and 7.81 are adopted without changes and will not be republished. Comments opposing various sections were submitted by Texas Mid-Continent Oil & Gas Association; Valero Transmission Company; Mitchell Energy & Development Corp.; Amoco Pipeline Company; Maxus Exploration Company; Lone Star Gas Company; Hoechst Celanese Corporation; Southern Union Gas Company; Mobil Pipe Line Company; Parker & Parsley Gas Processing Company; Sun Pipe Line Company; Phillips Petroleum Company; Rio Petroleum, Inc.; Chevron Pipe Line Company; Bass Engineering Company, Inc.; Texas Independent Producers and Royalty Owners Association; Houston Pipe Line Company; Entex; Energas Company; Association of Texas Intrastate Natural Gas Pipelines; Panhandle Producers & Royalty Owners Association; Permian Basin Petroleum Association; Texas Gas Association; Alpar Resources, Inc.; and a senator. No comments were received regarding proposed changes to sec.7.70(a) and sec.7. 70(b). These are adopted without changes to the proposed text. Texas Mid-Continent, Valero, Mitchell, Houston Pipe Line, and the Association of Texas Intrastate Natural Gas Pipelines opposed the proposed changes to sec.7.70(c). The amendments to this section were proposed to clarify the commission's jurisdiction regarding offshore pipeline facilities. Some of the commenters expressed the opinion that because the Cox Act, Article 6053-1, adopts the definitions in the Natural Gas Pipeline Safety Act of 1968, the commission does not have jurisdiction over offshore gathering lines; however, the commission does not agree. The Department of Transportation rule (49 Code of Federal Regulation, 192.1(b)) adopted pursuant to the Hazardous Materials Transportation Act exempts only onshore gathering lines from the safety requirements, and under the Natural Gas Pipeline Safety Act, sec.5, the commission is required to comply with the DOT rules. Further, the Texas Natural Resources Code, sec.91.101, gives the commission authority to adopt and enforce rules to prevent pollution of surface water or subsurface water in the state. One commenter recommended that the Oil & Gas Division of the commission regulate production and flow lines similar to the regulation performed by the Minerals and Management Service for production and flow lines in federal waters. The commission finds that consistent interpretation and enforcement of the safety rules requires that the Pipeline Safety section regulate production and flow lines as well as gathering lines in Texas waters. Most commenters expressed concern over the costs associated with compliance. The commission disagrees that cost will be a significant factor, however, because the only pipelines being added to the commission's safety jurisdiction are those located in the bay areas. The commission does agree that some period of time is necessary for transition and for establishing the necessary records for facilities located in bay areas and most of these pipelines are installed using industry standards. Also, the pipelines would be required to comply only with the operations and maintenance regulations, not the design and construction regulations. Therefore, sec.7.70(c) as adopted has been changed from the published version to give operators one year to comply with new regulations. Valero, Lone Star, Houston Pipe Line, Entex, and the Association of Texas Intrastate Natural Gas Pipelines all objected to the proposed changes to sec.7. 70(g)(1), which would require reporting of incidents within two hours of discovery. This two-hour "rule of thumb" has been a part of Pipeline Safety's guidelines for many years; now it is being formally incorporated into the regulations as the maximum time for reporting. The rule still requires that the reports be made as soon as practical. These commenters were concerned that incidents which would previously have been considered non-reportable would now be required to be reported; however, that is not the case. There is no change to that part of the rule requiring a gas company to notify the commission of any event that involves a release of gas from its pipeline which meets the criteria set out in sec.7.70(g)(1)(A)(i)-(v). A gas company cannot make such a report until its personnel have confirmed that there has been a release of gas that meets one or more of the criteria. There is no requirement that false alarms be reported, or that alarms be reported before they can be judged true or false. Two commenters suggested that the two-hour time limit should be triggered by "determination" as opposed to "discovery." The commission disagrees that this standard should be changed because it could potentially hamper a thorough investigation by the commission. Texas Mid-Continent commented that the two-hour time seemed reasonable in most situations, but urged that the commission provide an opportunity for an operator to show that a report not received within two hours constitutes a violation of the reporting rules. The commission agrees that operators would be given such an opportunity. No changes have been made to the published version of sec.7.70(g) (1). Section 7.70(g)(3) has been added to require the filing of safety related condition reports with the commission. The requirement for reporting safety related conditions is found in 49 Code of Federal Regulation, 191, and the reports are referenced in 49 Code of Federal Regulation, 192.605. Commenters Lone Star, Houston Pipeline, Entex, and the Association of Texas Intrastate Natural Gas Pipelines pointed out discrepancies between the proposed rule and the federal regulations. The commission agrees with these comments and has changed the language originally published in the Texas Register (17 TexReg 4508) to mirror the federal regulations. Texas Mid-Continent, Valero, Mitchell, Maxus, Lone Star, Southern Union, Entex, and the Association of Texas Intrastate Natural Gas Pipelines opposed the proposed addition of paragraph (4) to sec.7.70(g), which requires notice to the commission 30 days prior to construction of new pipeline projects of one mile or more in length. Some of the commenters felt that the commission was trying to become involved in eminent domain issues and right-of-way agreements. The commission does not agree with these comments because there is no provision for commission approval of a project or its route; no permit is required. The report is intended only to provide the commission with general information about location and type and size of pipe to enable commission staff to respond to inquiries and, if necessary, monitor construction to correct any potential safety violations. Commenters opined that this rule would be burdensome because of the number of projects required to be reported, the confusion about what information must be provided, and the delay of construction pending commission approval. Again, no commission approval is required; construction can proceed according to schedule. The comments regarding the number of projects required to be reported and the type of information required to be reported are well-taken; the adopted version of sec.7.70(g)(4) differs from the proposed version in that the reporting requirement applies only to those new pipeline projects which are five miles or more in length, and specifies that the information to be reported are the points of origin and termination, the counties traversed and the size and type of pipe. There is no requirement to report a metes-and-bounds description or a specific route; the report is not a commitment to the reported route. Because of he general nature of the information to be reported, alterations in the route should not necessitate filing a new report. New subsection sec.7.70(g)(5) has been changed from the proposed version in response to comments filed by Texas Mid-Continent and Valero. The comments suggested clarification that the offshore condition reports are to be filed after completion of underwater inspections. Lone Star and Entex filed comments regarding the proposed change to sec.7. 70(h) modifying the records retention schedule. Lone Star felt that there was no compelling pipeline safety reason to increase the time limits for retention of ancillary records not related to physical conditions. Entex agreed with the proposal. No changes to the published version have been made, because the rule simply requires that each gas company be able to demonstrate compliance or noncompliance with the provisions of the minimum safety standards. No comments were received on the proposed amendment to sec.7.70(i). Maxus, Parker & Parsley, Phillips, Rio, TIPRO, Panhandle Producers & Royalty Owners Association, Permian Basin Petroleum Association, Alpar Resources, and a senator objected to the proposed amendment to sec.7.71(a) which added a definition of "lease user." Mitchell, Maxus, Lone Star, Parker & Parsley, Phillips, Rio, TIPRO, Panhandle Producers & Royalty Owners Association, Permian Basin Petroleum Association, and Alpar Resources opposed the proposed change to sec.7.71(b)(3), which would require the supplier to odorize gas in the case of lease users. Most of the comments concerned the producer's liability associated with he installation of odorization equipment and the potential confusion of existing producer/lessor contractual obligations. Other comments concerned the expense to install and maintain odorization equipment at all free gas locations. Pursuant to these comments, the adopted version has been changed to require the lease user to odorize gas; however, the producer may not provide gas unless the lease user has installed the odorization equipment. The commission intends that this rule will apply prospectively only, that is, only to new installations and not to existing lease user installations. As proposed, the amendments to sec.7.71(d)(2) required identification numbers for each piece of odorization equipment. Comments by Valero, Lone Star, Southern Union, Parker & Parsley, Houston Pipe Line, Entex, and the Association of Texas Intrastate Natural Gas Pipelines questioned the purpose for what was considered to be a burdensome obstacle. In response to these comments, the adopted version has been changed to simply require the operator to maintain a list of all odorization equipment. This list will then be available for review during safety inspections. Only one comment was made regarding sec.7.72. Mitchell suggested changing "service" to "pipeline operator." This change could not be made because no change was proposed to this section in the published version. Therefore sec.7. 72 is being adopted without changes to the published version. Section 7.81 was changed to adopt certain amendments to the Natural Gas Pipeline Safety Act that have been enacted since the commission's last rule change. The only comment received on this section, made by Texas Mid-Continent, regards the enforcement of the federal regulations on carbon dioxide field injection systems. In response, the commission confirms that it will continue to pursue the jurisdictional status of these pipelines with the Department of Transportation and continue the moratorium on enforcement. The rule is adopted with no changes to the published version. Section 7.82 broadens the interpretation of "offshore" by clarifying that bay areas will be considered within the commission's enforcement jurisdiction. Texas Mid-Continent, Valero, and Mitchell filed comments on this section. As in the comments concerning this same change in the natural gas regulations, commenters expressed concern that the commission does not have jurisdiction over gathering lines offshore because they are rural gathering lines. However, this commission does not agree, because 49 Code of Federal Regulations, 195.1(b)(5) exempts only onshore gathering lines. The exemption in 195.1(b)(5) does not include production and flow lines located in federal waters. Further, the Texas Natural Resources Code gives the commission jurisdiction over pipeline transportation of hazardous liquids and over all hazardous liquid pipeline facilities as provided in the Hazardous Liquid Pipeline Safety Act of 1979. One commenter recommended that the Oil & Gas Division of the commission regulate production and flow lines similar to the regulation performed by the Minerals and Management Service for production and flow lines in federal waters. The commission finds that consistent interpretation and enforcement of the safety rules requires that the Pipeline Safety section regulate production and flow lines as well as gathering lines in Texas waters. Commenters expressed the opinion that compliance costs will be burdensome. The commission disagrees that cost will be a significant factor, however, because the only pipelines being added to the Commission's safety jurisdiction are those located in the bay areas. The commission does agree hat some period of time is necessary for transition and for establishing the necessary records for facilities located in bay areas and most of these pipelines are installed using industry standards. Also, the pipelines would be required to comply only with the operations and maintenance regulations, not the design and construction regulations. Therefore, sec.7.82 as adopted has been changed from the published version to give operators one year to comply with new regulations. With respect to sec.7.84(a), only one comment was filed. Texas Mid-Continent opined that the two-hour reporting time seemed reasonable in most situations, but urged that the commission provide an opportunity for an operator to rebut a presumption that a report not received within two hours constitutes a violation of the reporting rules. No changes have been made to the published version of sec.7.84(a). The commission proposed to amend sec.7.86(4) to clarify current requirements that cathodic protection test stations be provided for crossings of foreign metallic structure crossings. Texas Mid-Continent, Arnoco, Hoechst Celanese, Mobil, Sun Pipeline, Chevron, and Bass filed comments opposing the proposed change. Many commenters thought this amendment imposed a new and overly burdensome requirement. In response to these comments, sec.7.86(4) as adopted has been modified to reflect the intent that cathodic protection test station be provided at crossing points of other cathodically protected structures. New sec.7.73 is adopted to address the peculiar enforcement issues raised with master meter systems. Entex agreed with the effort to make master meter operators subject to the safety requirements. Lone Star, Entex, and Energas expressed the opinion that the master meter operator should be responsible for the protection of his/her system. The commission does not agree because this practice is similar to the transmission/distribution agreement. Typically, the master meter operator is less experienced in natural gas operations than the local distribution company; therefore, the level of safety would be enhanced by having the local distribution companies be responsible for the overpressure equipment on master meter systems. Also, this requirement does not apply retroactively. The rule is adopted with no changes. The amendments are proposed under Texas Civil Statutes, Article 6053-1, which provide the Railroad Commission of Texas with the authority to adopt by regulation safety standards and practices applicable to the transportation of gas and all gas pipeline facilities within the borders of this state to the maximum degree permissible under the Natural Gas Pipeline Safety Act of 1968, and to take any other requisite action in accordance with the Natural Gas Pipeline Safety Act of 1968, sec.5(a), 49 United States Code Annotated, sec.1674(a) (West 1968 and Supplement 1992). Additionally, the amendments are proposed under the Texas Natural Resources Code, sec.117.001-117.101, which authorizes the commission to regulate the pipeline transportation of hazardous liquids and facilities related thereto under the Hazardous Liquid Pipeline Safety Act of 1979, and to take any other requisite action in accordance with the Hazardous Liquid Pipeline Safety Act of 1979, sec.205, 49 United States Code Annotated, app. sec.2004 (West Supplement 1992), and under the Texas Natural Resources Code, sec.91.101, which authorizes the commission to prevent pollution of surface water or subsurface water in the state by adopting and enforcing rules relating to the drilling of exploratory wells and oil and gas wells or any purpose in connection with them, and to the production of oil and gas. sec.7.70. Natural Gas Pipeline Safety-General and Definitions. (a) Minimum safety standards. All gas pipeline facilities and the transportation within his state, except those facilities and that transportation of gas which are subject to exclusive federal jurisdiction under the Natural Gas Pipeline Safety Act of 1968, 49 United States Code Annotated, sec.1674(a) (West 1968 and Supplement 1992), shall be designed, constructed, maintained, and operated in accordance with the Minimum Safety Standards, 49 Code of Federal Regulations, Part 192, and the Control of Drug Use in Natural Gas, Liquefied Natural Gas, and Hazardous Liquid Pipeline Operations, 49 Code of Federal Regulations, Part 199, with amendments, effective 30 days after publication of this rule and with the additional regulations set out in this section. (b) Definitions. The following words and terms, when used in this section, sec.7.71, and sec.7.73 of this title (relating to Odorization Equipment, Odorization of Natural Gas, and Odorant Concentration Tests and Master Metered Systems), shall have the following meanings, unless the context clearly indicates otherwise. (1) -(7) (No change.) (8) Master meter system-A pipeline system (other than a local distribution company) for distributing gas within, but not limited to, a definable area, such as a mobile home park, housing project, or apartment complex, where the operator purchases metered gas from an outside source for resale through a gas distribution pipeline system. The gas distribution pipeline system supplies the ultimate consumer who either purchases the gas directly through a meter, or by other means, such as by rents. (c) Applicability. All gas pipeline facilities and facilities used in the transportation of natural gas shall be subject to the minimum safety standards, as amended, except for those facilities and transportation services subject to the jurisdiction of the Federal Energy Regulatory Commission pursuant to 15 United States Code, sec.717-sec.717z. In addition, all pipeline facilities originating in Texas waters (three marine leagues and all bay areas), shall be subject to the minimum safety standards. These pipeline facilities include those production and flow lines originating at the well. All new facilities included in this rule shall have one year after the date of the rule for achieving compliance with these regulations. (d)-(f) (No change.) (g) Reports and reporting. (1) Reporting of accident, leaks, or incidents. (A) At the earliest practical moment following discovery (within two hours), each gas company shall notify the commission by telephone of any event that involves a release of gas from its pipeline(s) which: (i)-(v) (No change.) (B) (No change.) (C) The telephonic notice required by this paragraph shall be made to the Railroad Commission emergency line, Pipeline Safety Section at (512) 463-6788, and shall include the following: (i) -(vi) (No change.) (D) Except as provided in subparagraph (E) of this paragraph, each gas company shall report, in writing, a summary of each accident or incident, under subparagraph (A)(i)-(iv) of this paragraph. The report shall be submitted to the Pipeline Safety Section as soon as practicable, but not more than 30 days after detection, on forms supplied by the Department of Transportation. This report is to be submitted in duplicate. The Pipeline Safety Section shall forward one copy to the Department of Transportation. (E)-(F) (No change.) (2) (No change.) (3) Safety related condition reports. Each gas company shall submit in writing a safety-related condition report for any condition as outlined in 49 Code of Federal Regulations, Part 191. The report required under 191.25, sent to the Department of Transportation, must also be submitted to the Pipeline Safety Section. (4) New construction report. Each operator shall file with the commission, at least 30 days prior to commencement of construction, the proposed originating and terminating points, counties to be traversed, size and type of pipe to be used, type of service, design pressure, and length of the proposed line. The new construction report is required for any installation of over five miles of total pipe. (5) Offshore pipeline condition report. Each operator shall file with the commission, within 60 days of completion of underwater inspection, a report of the condition of all underwater pipelines subject to 49 Code of Federal Regulations, 192.612(a) which shall include the information required in 49 Code of Federal Regulations, 191.27. (h) Records. On or after the effective date of these sections, each gas company operating gas facilities subject to the safety jurisdiction of this commission shall comply with the provisions of the minimum safety standards as amended, with respect to records required. Each gas company shall maintain records as the commission may require which are adequate to show compliance or noncompliance with such rules. All such records shall be kept open and readily available to the commission and/or its representatives at reasonable times. These documents and records shall be retained for the period established by 49 Code of Federal Regulations, Part 192 and sec.7.71 of this title (relating to Odorization Equipment, Odorization of Natural Gas, and Odorant Concentration Tests). If no time period has been established, the records must be kept for a period of no less than five years. (i) Operation and maintenance procedures. Each gas company operating a gas facility subject the safety jurisdiction of this commission shall submit to the director of the Pipeline Safety Section the procedural plans required by 49 Code of Federal Regulations, Part 192.605. If the commission finds the plan is inadequate to achieve safe operation, it shall require the plan to be revised. Thereafter, any and all changes in such plan of inspection and maintenance shall be submitted 20 days before it becomes effective. (j)-(k) (No change.) sec.7.71. Odorization Equipment, Odorization of Natural Gas, and Odorant Concentration Tests. (a) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise. (1)-(2) (No change.) (3) Lease user-A consumer who receives free gas in a contractual agreement with a pipeline operator or producer. (4) All other applicable definitions are found in sec.7.70(b) of this title (relating to Pipeline Safety). (b) Odorization of gas. (1)-(2) (No change.) (3) If gas is delivered for use primarily in one of the previously exempted activities or facilities and is also used in one of those activities for space heating, refrigeration, water heating, cooking, and other domestic uses, or if such gas is used for furnishing heat or air conditioning for office or living quarters, such latter gas shall be odorized in accordance with these rules by the user. In the case of lease users, the supplier is required to ensure that the gas will be odorized before being used by the consumer. (c) (No change.) (d) Odorization equipment. All gas companies shall utilize odorization equipment approved by he commission as follows. (1) Commercial manufacturers of equipment used for introducing malodorant required in this section may submit plans and specifications of such equipment to the Pipeline Safety Section with Form PS-25, for approval of standardized models and designs if the equipment is of a type commercially manufactured under accepted rules and practices of the industry. Commission-approved odorization equipment will be placed on a list of acceptable commercially available equipment. (2) Each operator shall be required to maintain a list of odorization equipment used in the odorization of natural gas for their particular operations. The list will include the location of the odorization equipment, the brand name, model number, and the date last serviced. The list will be available for review during safety evaluations by the commission. (3) All gas companies shall, before the installation of shop-made or other odorization equipment not approved according to paragraph (1) of this subsection, submit to the Pipeline Safety Section plans and specifications with the odorization equipment approval Form PS-25 describing the equipment to be used for introducing the malodorant required by this section. The commission shall indicate its approval or disapproval of such plans by written notification. (4) Any odorization equipment previously approved for use need not be reapproved under the terms of this section. (e)-(g) (No change.) sec.7.82. Jurisdiction. The commission has authority to exercise jurisdiction over the intrastate pipeline transportation of hazardous liquids and over all intrastate pipeline facilities as provided in the Hazardous Liquid Pipeline Safety Act of 1979 (Public Law 96-126), and the Texas Natural Resources Code, sec.117.011. Additionally, all pipeline facilities originating in Texas waters (three marine leagues and all bay areas) , shall be subject to the minimum safety standards. These pipeline facilities include those production and flow lines originating at the well. All new facilities included in this rule shall have one year after the date of the rule for achieving compliance with these regulations. sec.7.84. Required Records and Reporting. (a) Accident reporting. In the event of any failure or accident involving an intrastate pipeline facility from which any hazardous liquid is released, if the failure or accident is required to be reported by 49 Code of Federal Regulations, Part 195, the operator shall report to the commission as follows. (1) Incidents involving crude oil. In the event of an incident involving crude oil, the operator shall: (A) notify, by telephone, the Pipeline Safety Section of the commission at the earliest practicable moment following discovery of the incident (within two hours) and then the Pipeline Safety Section will notify he appropriate Oil and Gas District office; and (B) within 30 days of discovery of the incident, submit a completed Form H-8 (available from the commission) to the Oil and Gas Division of the commission. In situations specified in the 49 Code of Federal Regulations, Part 195, the operator must also file duplicate copies of the required Department of Transportation form with the Pipeline Safety Section. (2) Hazardous liquids other than crude oil. For incidents involving hazardous liquids other than crude oil, the operator shall: (A) notify the Pipeline Safety Section of the commission of such incident by telephone at the earliest practicable moment following discovery (within two hours); and (B) (No change.) (3) Telephonic reporting. The telephonic notice required by this part shall be made to the Railroad Commission Emergency line, Pipeline Safety Section at (512) 463-6788, and shall include the following: (A) company/operator name; (B) location of leak or incident; (C) time and date of accident/incident; (D) fatalities and/or personal injuries; (E) phone number of operator; (F) other significant facts relevant to the accident or incident. (b) Annual report. Each operator shall file with the commission an annual report listing line sizes and lengths, hazardous liquids being transported, and accident/failure data. The report must be filed with the commission on or before March 15 following the calendar year reported. An operator need only file additions or changes made to a pipeline system(s) following the first year filing. Reporting forms may be obtained from the Pipeline Safety Section. (c) (No change.) (d) Operations and maintenance procedure manual. Each operator shall prepare a manual outlining normal operating, maintenance, and emergency procedures for the facility as required by 49 Code of Federal Regulations, Part 195, or subsection (a) of this section and shall submit a copy of said manual to the director of the Pipeline Safety Section for review. Copies of changes or additions to the manual shall be submitted for review at least 20 days prior to the date on which they are scheduled to become effective. (e) Records. Each operator shall maintain and have available for inspection he same documents and records required by 49 Code of Federal Regulations, Part 195, and such additional records as the commission from time to time may require. These documents and records shall be retained for the period established for interstate operators by the Code of Federal Regulations, Title 49, Part 195, or for a period of not less than five years if no such federal requirement has been established. These records shall include, but not be limited to, the following: (1)-(4) (No change.) sec.7.86. Corrosion Control Requirements. The following requirements are applicable to the installation and construction of new pipeline metallic systems, the relocation or replacement of existing facilities, and the operation and maintenance of steel pipelines. (1)-(3) (No change.) (4) Cathodic protection test stations. Each cathodically protected pipeline must have test stations or other electrical measurement contact points sufficient to determine the adequacy of cathodic protection. These locations shall include, but are not limited to, pipe casing installations and all foreign metallic cathodically protected structures. Test stations (electrode locations) used when taking pipe-to-soil readings for determining cathodic protection shall be selected to give representative pipe-to-soil readings. Readings taken at test stations (electrode locations) over or near one or more anodes shall not, by themselves, be considered representative. (A)-(B) (No change.) (5)-(6) (No change.) 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 December 14, 1992. TRD-9216611 Nolan Ward Hearings Examiner, Legal Division, General Law Texas Railroad Commission of Texas Effective date: January 4, 1993 Proposal publication date: June 23, 1992 For further information, please call: (512) 463-7058 16 TAC sec.7.73 The new section is proposed under Texas Civil Statutes, Article 6053-1, which provide the Railroad Commission of Texas with the authority to adopt by regulation safety standards and practices applicable to the transportation of gas and all gas pipeline facilities within the borders of this state to the maximum degree permissible under the Natural Gas Pipeline Safety Act of 1968, and to take any other requisite action in accordance with the Natural Gas Pipeline Safety Act of 1968, sec.5(a), 49 United States Code Annotated, sec.1674(a) (West 1968 and Supplement 1992). 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 December 14, 1992. TRD-9216614 Nolan Ward Hearings Examiner, Legal Division-General Law Railroad Commission of Texas Effective date: January 4, 1993 Proposal publication date: June 23, 1992 For further information, please call: (512) 463-7058 TITLE 22. EXAMINING BOARDS Part VI. Texas State Board of Registration for Professional Engineers Chapter 131. Practice and Procedure Engineering Experience 22 TAC sec.131.81 The Texas State Board of Registration for Professional Engineers adopts an amendment to sec.131.81, concerning experience evaluation, without changes to the proposed text as published in the November 3, 1992, issue of the Texas Register (17 TexReg 7747). The section was amended to allow applicants teaching in TAC/ABET-accredited curricula to claim teaching as meeting experience requirements for registration. One year of teaching experience may be claimed by those applying under the Texas Engineering Practice Act, sec.12(a)(1) and two years may be claimed by those applying under the Act, sec.12(a)(2). No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 3271a, sec.8(a), which provide the board with the authority to make and enforce all rules and regulations necessary for the performance of its duties. 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 December 15, 1992. TRD-9216630 Charles E. Nemir, P.E. Executive Director Texas State Board of Registration for Professional Engineers Effective date: January 5, 1993 Proposal publication date: November 3, 1992 For further information, please call: (512) 440-7723 Board Review of Application 22 TAC sec.131.112 The Texas State Board of Registration for Professional Engineers adopts an amendment to sec.131.112, concerning approved applications, without changes to the proposed text as published in the November 3, 1992, issue of the Texas Register (17 TexReg 7748). The section is amended to in order to expedite the approval process of applications for registration. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 3271a, sec.8(a), which provide the board with the authority to make and enforce all rules and regulations necessary for the performance of its duties. 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 December 15, 1992. TRD-9216633 Charles E. Nemir, P.E. Executive Director Texas State Board of Registration for Professional Engineers Effective date: January 5, 1993 Proposal publication date: November 3, 1992 For further information, please call: (512) 440-7723 Registration 22 TAC sec.131.133 The Texas State Board of Registration for Professional Engineers adopts an amendment to sec.131.133, concerning certificates of registration, without changes to the proposed text as published in the November 3, 1992, issue of the Texas Register (17 TexReg 7748). The amendment adds environmental to the list of recognized branches of engineering under which applications for registration will be accepted and for which a principles and practice examination will be available from the National Council of Examiners for Engineering and Surveying (NCEES). One written comment was received from an individual who suggested that the amendment be adopted as environmental/safety engineering. The board did not concur as NCEES does not offer a principles and practice examination in safety engineering. The amendment is adopted under Texas Civil Statutes, Articles 3271a, sec.8(a) , which provide the board with the authority to make and enforce all rules and regulations necessary for the performance of its duties. 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 December 15, 1992. TRD-9216631 Charles E. Nemir, P.E. Executive Director Texas State Board of Professional Engineers Effective date: January 5, 1993 Proposal publication date: November 3, 1992 For further information, please call: (512) 440-7723 22 TAC sec.131.137 The Texas State Board of Registration for Professional Engineers adopts an amendment to sec.131.137, concerning disciplinary actions, without changes to the proposed text as published in the July 10, 1992, issue of the Texas Register (17 TexReg 4925). The section was amended to establish clear and consise disciplinary guidelines under which the facts and circumstances of each disciplinary case will be assessed before any sanctions available to the board are ordered. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 3271a, sec.8(a), which provide the board with the authority to make and enforce all rules and regulations necessary for the performance of its duties. 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 December 15, 1992. TRD-9216632 Charles E. Nemir, P.E. Executive Director Texas State Board of Professional Engineers Effective date: January 5, 1993 Proposal publication date: July 10, 1992 For further information, please call: (512) 440-7723 TITLE 25. HEALTH SERVICES Part I. Texas Department of Health Chapter 145. Long Term Care Subchapter G. Standards for Nursing Homes that Cover Licensure and Medicaid Certification 25 TAC sec.145.111 The Texas Department of Health (department) adopts an amendment to sec.145.111, with changes to the proposed text as published in the August 11, 1992, issue of the Texas Register (17 TexReg 5617). As a result of comments received, the department has also made some changes to the standards which are adopted by reference in sec.145. 111. The standards which the department adopts by reference are in Texas Department of Human Services rules in 40 TAC sec.sec.19.1-19.2216. The department's amendment to sec.145.111 incorporates TDHS's adopted repeal of existing 40 TAC sec.19.2012 and new 40 TAC sec.sec.19.2201-19.2209 and sec.sec.19.2211-19.2216, concerning nursing facility remedies for contract violations being adopted by TDHS in this issue of the Texas Register to be effective February 1, 1993. This amendment was reproposed because of comments and recommendations by the joint TDHS and department committee. By adopting the reproposed TDHS repeal and new sections by reference, the department will utilize the TDHS rules in sec.sec.19.2201-19.2209 and sec.sec.19. 2211-19.2216 as penalty rules for nursing facilities which participate in the Medicaid program. In addition, the department's amendment to sec.145.111 will incorporate TDHS's adopted amendments to existing 40 TAC sec.19.302, sec.19.810, sec.19.1401, and sec.19.1503, concerning transfer and discharge, nursing practices, infection control, and applicable codes and standards which were published in the September 22, 1992, issue of the Texas Register to be effective November 1, 1992. These amendments correct references to state/federal laws and health practitioners' licensing acts or clarify current standard wording. During the public comment period, the department received 41 comments to the proposed standards that included comments of an editorial and clarification nature as well as substantive comments. Changes made by the department to the proposed standards for the purpose of editorial correction or strictly for clarification will not be addressed individually. The department is responding individually to comments on the proposed standards as follows. Comment: Concerning the rules generally, a commenter expressed concern that the separation of licensure and certification remedies would interfere with the coordination of remedies between the Texas Department of Human Services and the Texas Department of Health. Response: The department disagrees and has made no change. The organization of the remedies rules does not prohibit or detract from interagency coordination. Comment: A commenter felt that the remedies rules provide a bifurcated system of penalties, while the law stipulates a "single set of standards" for nursing facilities. Response: The department disagrees. The Health and Safety Code requires the department and the TDHS to jointly develop one set of standards in compliance with state licensing authority and federal regulations for Title XIX nursing facilities. The proposed remedies rules were developed pursuant to House Bill 7, 72nd Legislature, First Called Session and apply only to Title XIX nursing facilities. Licensure rules for administrative penalties are a separate issue and are established under a separate statutory authority. No change is made. COMMENT: A commenter felt that the remedies rules should be consistent with the Health Care Financing Administration's (HCFA) proposed new enforcement rules. Response: It is the department's intention that the state enforcement and remedies rules be consistent with the final federal rules. However, the proposed federal enforcement rules comment period has just ended. The department does not know when the federal rules will be final. The department's position is that it needs to finalize the state remedies rules now; further changes to conform with the federal rules will be made when appropriate. Comment: Concerning sec.19.2202 subparagraph (C) under the definition of "Severity", regarding the definition of actual harm includes a reference to the ability of the resident "to achieve the highest practicable physical, mental and psychosocial well-being." A commenter felt that the reference should be deleted. Response: The department disagrees. This language was taken directly from federal requirements and is contained in sec.19.1701(a). No change is made. Comment: Concerning sec.19.2202, a commenter suggested that the definition of "Deficiency" is too broad. Response: The department disagrees. This definition was developed by an interagency/public advisory committee with representation from the consumers, providers, and state agencies and was approved by the Board of Health. The definition is acceptable and provides guidance to providers, consumers and department staff. No change is made. Comment: Concerning sec.19.2202, a commenter felt that the definition of "Scope" does not adequately convey the concept of scope and percentages should not be used in the definition. Response: The department disagrees. This definition was also developed by the interagency/public advisory committee and was approved by the Board of Health. The definition is acceptable and provides guidance to the providers, consumers, and surveyors/investigators. No change is made. Comment: Concerning sec.19.2202, a commenter suggested that the definition of "Severity" be clarified so that the second part of the definition specifies how to measure the negative outcome. Response: The current language tracks the language in the proposed federal rules on remedies and the department does not see a need for change at this time. No change is made. Comment: Concerning sec.19.2202, a commenter suggested the definition of "Severity" indicated that a resident rights violation would be serious before a remedy is applied. Response: The department disagrees. Section 19.2203, Application of Remedies, and sec.19.2205, Monetary Penalties, already clarify this. No change is made. Comment: Concerning sec.19.2202, a commenter felt that the definition of "Survey" should include the federal definition for "standard survey," and should be revised to reflect an administrative law judge's ruling that a complaint investigation cannot be called a survey, and should include a reference to the use of HCFA prescribed survey methods, procedures, and forms for all surveys and complaint investigations. Response: The department agrees with part of this comment and has made changes to the definition of Survey to clarify that if the federal standards, protocols, forms, methods, and procedures for survey are not used, the survey performance is inadequate. The department disagrees with the comment regarding inclusion of the administrative law judge ruling and that the federal definition for "standard survey" be used. The definitions section is to define terms as they are used in these rules only. The term "Survey," in these rules includes any action which could result in the citing of deficiencies leading to contract violations and resultant remedies. Complaint investigations may result in the citing of such deficiencies and actions. There is no succinct federal definition of "standard survey." No change has been made to final rules regarding the last two parts of this comment. Comment: Concerning sec.19.2203, a commenter suggested that the subsection on application of remedies does not define "health and safety hazards" which might allow the survey agency to use this term all inclusively. Response: The department does not believe a change is necessary because the department has in place a quality assurance program for all surveyors which addresses the surveyor's application of the survey and certification rules, protocols, and procedures. No change is made. Comment: Concerning sec.19.2203, a commenter felt that the rules conflict with federal regulations that a surveyor cite only current contract violations, and not past contract violations which have been corrected by the time of the survey. Response: The department disagrees. The remedies rules for Title XIX nursing facilities operate in tandem with the survey process. Therefore, remedies cannot be applied in instances in which federal survey regulations prohibit citing contract violations. No change is necessary. Comment: Concerning sec.19.2203, a commenter suggested that the reference to "immediate jeopardy to health and safety" should be changed to "immediate and serious threat." Response: The department disagrees. The language tracks the federal regulations and no change is needed. Comment: Concerning sec.19.2203, a commenter recommended that the subsection for application of remedies should contain wording that the facility can give input that will be considered prior to the recommendation/imposition of a remedy. Response: The department agrees and has made an appropriate addition. Comment: Concerning sec.19.2203, a commenter suggested that the requirement that a 90-day termination automatically require a directed plan of correction be deleted. Response: The department disagrees. The department believes that the directed plan of correction is an important component of the remedies process and is appropriate when a 90-day termination is recommended based on cited deficiencies. No change is made except to cross reference sec.19.2204 relating to directed plan of correction for clarification. Comment: Regarding sec.19.2203, a commenter suggested that the 23- day decertification track should be reserved for the most serious of a temporary manager must be included as an option to the 23-day decertification. Response: The department partially agrees. The rules already reflect that the 23-day termination proposal is used for serious findings that immediately jeopardize the health or safety of resident(s). The department agrees with TDHS that it is not of a temporary manager as a remedy option. No change is made. Comment: Concerning sec.19.2204, a commenter suggested that the wording "may solicit information from the facility" should be changed to "must consider information and suggestion." Response: The department disagrees. The current wording allows for the solicitation of information and an appeal process for facilities. No change is made. Comment: Regarding sec.19.2204, a commenter recommended that a new definition for "state directed plans of correction" should be added to ensure that unrealistic, expensive plans will not be required. Response: The department disagrees. The additional language is unnecessary as the current rules state that the directed plan addresses only the correction or action which applies to the specific deficiency(ies) out of compliance. No change is made. Comment: Concerning sec.19.2205, a commenter felt the language which states "monetary penalties are assessed" should read "may be assessed." Response: The department disagrees because sec.19.2203, Resident Related Contract Violations, clearly states that monetary penalties are an optional remedy. Section 19.2205 addresses how monetary penalties are to be applied when they are imposed. Comment: Concerning sec.19.2205, a commenter felt that the monetary penalties are too high and punitive in nature and they should be reserved for only the most serious situation. Response: The department disagrees. The proposed rules state that the remedies are for serious deficiencies or situations. The amounts of the monetary penalties were agreed upon by an interagency/public advisory committee representing the providers, consumers, and state agencies and approved by the agencies' Boards. Comment: Concerning sec.19.2205, a commenter asked what guidelines will the department use for determining monetary penalties. Response: No change is necessary as the criteria for assessment of monetary penalties are covered in sec.19.2205. Comment: Relating to sec.19.2205, a commenter suggested that the TDHS should be required to notify the owner of recommendations for remedies if his address is different from that of the facility. Response: The department disagrees. It is the owner's responsibility to maintain communication with the facility regarding remedies and other certification recommendation/actions. Comment: Concerning sec.19.2205, subsection (b)(2)(E), which doubles the monetary penalties when a facility erroneously reports that a contract violation has been corrected, a commenter suggested that this requirement should be deleted. Response: The department disagrees. The proposed federal enforcement rules contain a provision for increased penalties in this situation. No change is made. Comment: In sec.19.2005, a commenter suggested that "accountability periods" should be based solely on three annual standard surveys. Response: The department disagrees. Any contract violation, whether found at an annual survey or otherwise, should begin an accountability period. No change is made. Comment: Concerning sec.19.2206(b), a commenter suggested changing this provision to allow for an "informal hearing before a TDHS official who was not involved with the initial decision." Response: The department disagrees. The initial decision to assess remedies is made by the department surveyor/investigator. The appeal process at TDHS is already before an official who was not involved in the initial decision. No change is made. Comment: Concerning sec.19.2209(b), a commenter felt that the appeal provisions do not appear to apply to many of the remedies available to TDHS and the department. Response: The department does not see a need for rewording. The federal proposed rules also do not allow appeals for every action. The state remedies rules track that concept. No change is made. Comment: Concerning sec.19.2211, a commenter suggested changing the title of the section to "Scope" and deleting references to debarment, since these rules do not apply to nursing facilities. Response: The department disagrees. This section relates to entities which are excluded from Medicaid contracts. The TDHS will retain the title of "Exclusions" and the reference to debarment since the proposed debarment rules do apply to Title XIX nursing facilities. Commenters included individuals, as well as representatives of the Texas Association of Homes for the Aging and the Texas Health Care Association. All commenters were generally in favor of the rules; however, they made comments and offered specific suggestions for change. The amendment is adopted under the Health and Safety Code, sec.222.0255, which provides the department and the Texas Department of Human Services with the authority to jointly develop one set of standards for nursing facilities that applies to licensure and to certification for participation in the medical assistance program under the Human Resources Code, Chapter 32, and to adopt by rule the standards and any amendments to them; and sec.12.001, which provides the Board with the authority to adopt rules for the performance of every duty imposed by law on the Board, the department, and the Commissioner of Health. sec.145.111. Standards for Nursing Homes Jointly Developed by the Texas Department of Health and the Texas Department of Human Services that apply to Licensure and Medicaid Certification. (a) The Texas Department of Health adopts by reference the Texas Department of Human Services rules 40 TAC sec. sec.19.1-19.2216, concerning Long Term Care Nursing Facility Requirements for Licensure and Medicaid Certification effective October 8, 1990, as amended: October 1, 1990, under federal mandate; September 1, 1991; March 17, 1992; April 1, 1992, under federal mandate; March 3, 1992 under federal mandate; April 1, 1992, and August 26, 1992, under federal mandates; and February 1, 1993. (b) (No change.) 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 December 16, 1992. TRD-9216670 Robert A. MacLean, M.D. Deputy Commissioner Texas Department of Health Effective date: February 1, 1993 Proposal publication date: August 11, 1992 For further information, please call: (512) 458-7709 TITLE 31. NATURAL RESOURCES AND CONSERVATION Part IX. Texas Water Commission Chapter 330. Municipal Solid Waste Subchapter Z. Waste Minimization and Recyclable Materials 31 TAC sec.sec.330.1200-330.1205 The Texas Water Commission adopts new sec.sec.330.1200-330.1205. Section 330. 1200 and sec.330.1201 are adopted with changes to the proposed text as published in the October 6, 1992, issue of the Texas Register (17 TexReg 6886). Sections 330.1202-330.1205 are adopted without changes and will not be republished. The Texas Water Commission is required to adopt rules governing the voluntary newsprint recycling program established under the Texas Health and Safety Code, sec.361.430. Under this program, Texas newspaper publishers will use increasing amounts of recycled newsprint in their publishing operations from the years 1993 through 2000. The Texas Health and Safety Code, sec.361.427 and sec.361.430, directs the Texas Water Commission to define recycled newsprint and to monitor the industry's compliance with the voluntary program. Section 361.430 also authorizes the commission to adopt mandatory enforcement measures if it determines that publishers are not meeting the goals of the voluntary program. The new sections define for both newspaper publishers and newsprint manufacturers the standards by which the state will measure compliance with the voluntary newsprint recycling program as described in Chapter 361. Recycled newsprint is defined as that containing at least 25% postconsumer fiber, and an alternate method for achieving compliance with statutory goals is defined. The section's effect will be to allow publishers to meet the targets established under law, while giving them the flexibility to obtain newsprint containing recovered fiber from a variety of sources. The agency received three written comments on the proposed rule during the comment period. One commenter commended the rules as published and made a commitment on behalf of the industry he represented to make the rules work. A second commenter declared the proposed rules to be consistent with "both the letter and the spirit of Senate Bill 1340." In particular, this commenter concurred with the rules' designation of "aggregatecontent" as an alternative way of measuring compliance with the legislative goals. He noted that this method gives publishers maximum flexibility in sourcing recycled-content newsprint and gives manufacturers an incentive to use whatever amount of recovered fiber they can accommodate, given available equipment. This second commenter also supported the inclusion of overprints in the definition of postconsumer recovered material, since these unsold papers are normally landfilled. Finally, this commenter applauded the flexibility allowed by the rules' labeling requirements, which permit manufacturers to base recycled- content claims on annual production. The third commenter disagreed with the use of the 25% postconsumer-content standard for recycled newsprint. He noted that the United States Environmental Protection Agency has adopted a 40% standard, and that this standard has been endorsed by the Recycling Advisory Council, an Environmental Protection Agency (EPA)-funded citizen task force representing recyclers, regulators, and manufacturers charged with recommending product standards to EPA. The commenter also noted that states that have adopted minimum-content standards for recycled newsprint have used the 40% figure. This commenter thought the Texas standard should reflect this "national consensus," and that to deviate would undermine efforts to use content standards to challenge manufacturers to achieve greater utilization of recovered materials. This commenter recommended a change in the definition of "aggregate postconsumer recycled content" to clarify how the aggregate number is to be calculated. He also recommended changes in the definition of "postconsumer recovered material" to explicitly exclude papermaking waste and blank white news from the measurement of postconsumer content in newsprint. The commission agreed with both these changes and has incorporated them into the adopted rule. In addition to the changes made pursuant to comments, the commission has deleted the phrase "on a monthly basis" from sec.330.1201(d)(1). This change was made to avoid giving the impression that manufacturers must give notice to publishers monthly, regardless of whether that publisher had ordered newsprint that month. Without this phrase, the subsection requires manufacturers to give notice of the average postconsumer recycled content of an order of newsprint whenever that order is delivered. The following groups and associations submitted comments: The Texas Daily Newspaper Association; and Akin, Gump, Hauer and Feld, LLP, on behalf of Champion International Corporation. The Texas Water Commission disagrees with the recommendation to change the content standard for recycled newsprint to 40%. At present, there are in effect no standards for recycled content for any products. The EPA has adopted standards for five products, including newsprint, but these standards apply only to purchases made by the federal government or by government contractors and grantees. Since the public sector is not a large purchaser of newsprint, the EPA newsprint standard is of limited applicability. The Recycling Advisory Committee's recommendations are likewise aimed solely at purchases by the government and its contractors. Though the EPA standard is the only one with national scope, its audience is too narrow to characterize the standard as "widely accepted" or as "the national consensus." Though California and Arizona have adopted the 40% standard in their state newsprint recycling programs, eight other states and the District of Columbia have opted not to use a minimum- content standard at all, but have relied instead upon the aggregate-content approach which the TWC rule uses as an alternative method of compliance. This trend toward aggregate-content standards results from states' recognition that paper mills need the flexibility to incorporate recycled fiber into the manufacturing process in ways that make economic and technological sense for them, and from the recognition that states should focus their efforts on the ultimate public-policy goal of diverting newspaper from the waste stream. Programs that use aggregate-content standards allow publishers to buy (and manufacturers, therefore, to produce) newsprint with varying amounts of recycled fiber, so long as the publishers achieve targets for overall or aggregate usage of recycled fiber. There is no magic to the 40% standard; some mills can produce a 100% recycled content newsprint. But those that cannot meet the 40% standard should not be discouraged from using recovered fiber at all. Texas has two newsprint mills, both owned by one company. This company has installed de-inking capacity at its Sheldon plant, which will allow the mill to generate newsprint containing 28% postconsumer fiber. In Texas, a 40% standard would place this product at a marketing disadvantage, since it could not be considered "recycled newsprint," despite the fact that the mill will be diverting from the state's landfills 175,000 tons per year of old newspaper and magazines. The agency disagrees with the argument that a stringent standard is needed to induce manufacturers to invest in the retooling of plants to accommodate recovered materials. For the paper industry generally, and the newsprint industry in particular, that investment has already been made. Since 1990, an estimated $3 billion has been committed to paper manufacturing projects that will utilize waste paper. The Newspaper Association of America estimates that 36 mills will be producing recycled newsprint by the end of 1994. In the agency's view, the state's waste-diversion goals would not be served by adopting a punitive minimum-content standard. The aggregate-content standards contained in the rule would result in greater waste diversion after 1993 than a 40% standard would have achieved. In exchange for flexibility in sourcing recycled-content paper, publishers are committing to using greater volumes of this paper. Diversion of waste should, therefore, be increased using this alternate method. The new sections are adopted pursuant to the Texas Health and Safety Code, sec.361.427 and sec.361.430 (Vernon 1992), which provides the Texas Water Commission with the authority to define recycled products in terms of postconsumer content and to develop rules governing the newsprint recycling program. The rules are also proposed pursuant to the Texas Water Code, sec.5. 103 and sec.5.105 (Vernon 1992) which grants the Texas Water Commission general rulemaking authority. sec.330.1200. Purpose and Definitions. (a) Purpose. These sections set forth newsprint recycling requirements for newsprint manufacturers and newspaper publishers. The sections contain recordkeeping and reporting procedures with respect to the utilization of recycled-content newsprint in newspaper publishing operations. These sections are applicable to every newspaper printing and publishing operation in this state that publishes, sells, or distributes newspapers, as well as to those manufacturers and suppliers who provide newsprint for sale in Texas. These guidelines provide maximum flexibility to newspaper publishers in an effort to support the state's goals of encouraging newspaper publishers to purchase newsprint containing recycled postconsumer fiber, encouraging cooperation between and among local community organizations to establish and promote community newsprint collection efforts, and offering an incentive to private companies to build and operate de-inking and recycled newsprint mills in Texas. The overall purpose of these guidelines is to reduce the amount of old newsprint that must be disposed of in solid waste landfills. (b) Definitions. The following words, terms, and abbreviations, when used in these sections, shall have the following meanings, unless the context clearly indicates otherwise. (1) Aggregate postconsumer recycled content-Refers to the total amount of postconsumer recovered material by weight contained in total purchases of newsprint for a specified period. It is arrived at by multiplying the percentage of postconsumer recovered fiber in each shipment of newsprint purchased by the percentage of total newsprint purchases that shipment represents and summing the products thus calculated for all shipments received during the specified time period. (2) Commission-The Texas Water Commission. (3) De-inked fiber-A fiber which has undergone the de-inking process. (4) De-inking process-A process by which most of the ink, filler, coating, and other extraneous (non-cellulose) material is removed from printed or unprinted paper. (5) Metric ton-1,000 kilograms. To convert pounds to metric tons the number of pounds should be divided by 2,204.6. (6) Newspaper-A publication that is printed on newsprint and published, sold, and distributed in the state, both daily and non-daily, to disseminate current news and information of general interest to the public. (7) Newspaper publisher-An individual or corporate group of newspaper publishers which uses newsprint in a newspaper publishing operation. (8) Newsprint-Paper used for the printing of newspapers. (9) Newsprint manufacturer-A business which makes newsprint. (10) Overs-Also known as "overruns," are newspapers printed for sale to distributors or the public which remain unsold. Overs include inserts such as magazines and advertising supplements. (11) Postconsumer recovered material-Includes paper, paperboard, and other fibrous products that have completed their normal cycle of production and use, but excludes all papermaking waste and blank white news, which is diverted for recycling prior to printing. Postconsumer recovered material may also include any de-inked fiber, regardless of the source of such fiber except from sources specifically excluded previously. Overs are included within the definition of postconsumer recovered material. (12) Postconsumer recycled content-That portion of manufactured newsprint that is comprised of postconsumer recovered material, usually expressed as a percentage of the total content. (13) Recycled newsprint-Any newsprint certified by the manufacturer or supplier as containing at least 25% postconsumer recovered material, by fiber weight. (14) Virgin newsprint-Newsprint which contains 100% new materials in its formation. sec.330.1201. General Guidelines and Requirements. (a) Target recycling percentages. In order to bring about a significant state- wide increase in newsprint recycling, newspaper publishers are encouraged to take whatever measures may be necessary to ensure that their publishing businesses meet or exceed the target recycling percentages set forth in paragraph (1) of this subsection. In the event a newspaper publisher chooses to purchase newsprint with less than 25% postconsumer recycled content, the commission will consider legislative intent to be achieved if that publisher meets or exceeds the alternative aggregate recycling content standards set forth in paragraph (2) of this subsection. (1) Newspaper publishers should obtain and utilize newsprint such that the percentage of "recycled newsprint," as defined in sec.330.1200 of this title (relating to Purpose and Definitions), in the overall total amount of newsprint purchased each year, is at least: (A) 10% by the end of calendar year 1993; (B) 20% by the end of calendar year 1997; and (C) 30% by the end of calendar year 2000. (2) In the alternative, newspaper publishers may obtain and utilize newsprint such that the aggregate postconsumer recycled content, by fiber weight, in the overall total amount of newsprint purchased each year is at least: (A) 2.5% by the end of calendar year 1993; (B) 12% by the end of calendar year 1997; and (C) 18% by the end of calendar year 2000. (b) Certification. Newsprint manufacturers and suppliers shall certify the average percentage, based on annual production, of postconsumer recovered material contained in any newsprint sold and/or delivered to Texas newspaper publishers. (c) Recordkeeping. Newsprint purchase and delivery records shall be maintained by all newspaper publishers. In addition, mill certification records showing the average percentage of postconsumer recovered material in purchased and/or utilized newsprint shall be kept by each publisher. Such records must contain sufficient information to enable the publisher to prepare those reports required under sec.330.1203 of this title (relating to Reports). An official Texas Daily Newspaper Association (TDNA) Newsprint Order Form may be used to maintain and verify required records. Newspaper publishers shall retain required records for three years. (d) Notice of postconsumer content and labeling. (1) Newsprint manufacturers or suppliers shall indicate, on invoices provided to newspaper publishers, suppliers, or commercial printers, or through another form of written notice to such consumers, the average postconsumer recycled content of each roll of newsprint which is the subject of such invoice or notice, and the amount of newsprint purchased from such newsprint manufacturer or supplier containing the minimum postconsumer recycled content required to meet the definition of "recycled newsprint" under sec.330.1200 of this title (relating to Purpose and Definitions). (2) Newsprint which contains less than the minimum percentage of postconsumer recovered material required to qualify it as recycled newsprint may be identified as follows: "this product contains an average of ____% postconsumer recycled fiber, based on annual production," with the percentage indicated. (e) Comparable price, quality, and availability. Texas newspaper publishers are urged to voluntarily increase utilization of "recycled newsprint" or other newsprint that has been certified as containing postconsumer recovered material, beyond the target recycling percentages set forth in subsection (a) of this section, in those instances where: (1) availability of such products exist; (2) the net cost of utilizing such products is comparable to that of utilizing virgin newsprint; and (3) the quality of such products (considering such factors as brightness, opacity, and cross machine tear strength) is similar to that of virgin newsprint. 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 December 9, 1992. TRD-9216441 Mary Ruth Holder Director, Legal Division Texas Water Commission Effective date: December 30, 1992 Proposal publication date: October 6, 1992 For further information, please call: (512) 908-2045 TITLE 34. PUBLIC FINANCE Part III. Teacher Retirement System of Texas Chapter 49. Collection of Debts 34 TAC sec.sec.49.1-49.7 The Teacher Retirement System of Texas (TRS) adopts new sec.sec.49.1-49.7, concerning the collection of debts owed to the Teacher Retirement System of Texas, without changes to the proposed text as published in the November 10, 1992, issue of the Texas Register (17 TexReg 7855). These rules are being adopted in order to comply with the requirements set forth in Senate Bill 3, First Called Session, 72nd Legislature, requiring rules and procedures to be adopted. These rules were initially promulgated on an emergency basis, effective September 1, 1992. The sections are intended to provide general procedures for the collection of delinquent accounts owed to the retirement system, to assist in the development of in-house collection strategies, and for the referral of collection of collection matters to the Office of the Attorney General. No comments were received regarding adoption of the new sections. The new sections are adopted under the Texas Government Code, sec.825.102, which authorizes the Board of Trustees of the retirement system to adopt rules for the administration of the funds of the retirement system and for the transaction of business of the board. 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 December 14, 1992. TRD-9216619 Wayne Blevins Executive Secretary Teacher Retirement System of Texas Effective date: January 4, 1993 Proposal publication date: November 10, 1992 For further information, please call: (512) 370-0524 TITLE 37. PUBLIC SAFETY AND CORRECTIONS Part XIII. Texas Commission on Fire Protection Chapter 427. Training Facilities Subchapter B. Minimum Standards for Aircraft Fire Protection Personnel Training Facilities 37 TAC sec.427.215 The Texas Commission on Fire Protection adopts an amendment to sec.427.215, concerning aircraft crash and rescue training facilities, without changes to the proposed text as published in the September 11, 1992, issue of the Texas Register (17 TexReg 6270). The amendment corrects the cross reference in the section to the minimum standards for intermediate fire protection instructor certification. The correction provides the correct cross reference to the minimum standards for intermediate fire protection instructor certification. No comments were received regarding adoption of the amendment. The amendment is adopted under the Texas Government Code, sec.419.008, which provides the Texas Commission on Fire Protection with authority to adopt rules for the administration of its powers and duties; and the Texas Government Code, sec.419.028(b)(1), which provides the commission with authority to approve or revoke the approval of an institution or facility for a school operated by or for this state or a local government specifically for training fire protection personnel or recruits. 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 December 14, 1992. TRD-9216637 Jack Woods General Counsel Texas Commission on Fire Protection Effective date: January 5, 1993 Proposal publication date: September 11, 1992 For further information, please call: (512) 873-1700 TITLE 40. SOCIAL SERVICES AND ASSISTANCE Part I. Texas Department of Human Services Chapter 19. Long Term Care Nursing Facility Requirements for Licensure and Medicaid Certification Subchapter U. State and Local Requirements The Texas Department of Human Services (DHS) adopts the repeal of sec.19. 2012 and adopts new sec.sec.19.2201-19.2209 and sec.sec.19.2211-19.2216. New sec.sec.19.2202, 19.2203, 19.2205, and 19.2207-19.2209 are adopted with changes to the proposed text as published in the August 4, 1992, issue of the Texas Register (17 TexReg 5436). The repeal of sec.19.2012 and new sec.sec.19.2201, 19.2204, 19.2206, and 19.2211-19.2216 are adopted without changes and will not be republished. The justification for the repeal and new sections is to establish a new system of remedies against nursing facilities found by the Texas Department of Health to be out of compliance with the Long Term Care Nursing Facility Requirements for Licensure and Medicaid Certification. The repeal and new sections result from an amendment to the Human Resources Code, sec.32.021, by House Bill 7, 72nd Texas Legislature, 1991, which authorizes DHS to assess and collect remedies. The repeal and new sections will function by improving the quality of care in nursing facilities. During the public comment period, DHS received comments from the Texas Association of Homes for the Aging (TAHA), Texas Department of Health (TDH), and the Texas Health Care Association (THCA). A summary of the comments and DHS's responses follow. The following five comments were received from TAHA. COMMENT 1-Preamble to the proposed rules-The commenter objects to the separation of licensure and certification remedies on the grounds that this would interfere with the coordination of remedies. RESPONSE-DHS's position is that coordination of the remedies is not prohibited by the current organization of the rules. COMMENT 2-sec.19.2202, Definitions ("Severity")-The commenter objects to the inclusion in this definition of "actual harm," referencing the ability of the resident "to achieve the highest practicable physical, mental, and psychosocial well-being." The commenter also noted that under subparagraph (D) of the definition of "severity" there is no definition for "actual life-threatening harm or resident death." RESPONSE-This definition is taken directly from federal language and is already required by sec.19.1701(a). The definition for "actual life-threatening harm or resident death" has been added. COMMENT 3-sec.19.2203, Resident-Related Contract Violations-The commenter stated that this section does not define "health and safety hazards," which might allow the survey agency to use this term all-inclusively. RESPONSE-TDH's quality assurance program for surveyors addresses this potential. COMMENT 4-sec.19.2205, Monetary Penalties-The commenter objects to the following statement in this section: "monetary penalties are assessed" rather than "may be assessed." RESPONSE-Section 19.2203, Resident-Related Contract Violations, clearly states that monetary penalties are an optional remedy. Section 19.2205 stipulates how monetary penalties are to be applied when they are imposed. COMMENT 5-sec.19.2214, Licensing Requirements-The commenter is opposed to the section on the basis that it rules out coordination between DHS and TDH regarding imposition of remedies. RESPONSE-DHS's position is that this section does not prevent coordination between the two agencies. The following 32 comments were received from THCA: COMMENT 1-The commenter requested inclusion in the rules of a reference to Health Care Financing Administration's (HCFA's) prescribed survey methods, procedures, and forms for all surveys and complaint investigations. RESPONSE-DHS has added language to the definition of "survey" in sec.19.2202 to require the use of HCFA forms and procedures. COMMENT 2-The commenter states that the monetary penalties are too high and punitive in nature, and they should be reserved for only the most serious situations. RESPONSE-The amounts of the monetary penalties were agreed upon by the Sanctions and Penalties Advisory Committee (SPAC), and it was the intention of the committee that these penalties are to be reserved for the most serious situations. DHS's believes no changes to the rule language are necessary. COMMENT 3-The commenter requests addition of a definition for "state-directed plans of correction" to ensure that unrealistic, expensive plans will not be required. RESPONSE-DHS believes that adding this definition is unnecessary. Directed plans of correction will require only the action necessary to bring facilities into compliance with the requirements. COMMENT 4-The commenter objects to the use of percentages in the definition of "scope." RESPONSE-SPAC considered this issue and approved the current definition; therefore, DHS is adopting the definition as proposed. COMMENT 5-The commenter states that the rules conflict with federal regulations that surveyors cite only current contract violations and not past contract violations which have been corrected by the time of the survey. RESPONSE-DHS's position is that the remedies rules operate in tandem with the survey process. Therefore, remedies cannot be applied when federal survey regulations prohibit citing contract violations. No change is necessary. COMMENT 6-The commenter states that the rules provide a bifurcated system of penalties, while the law stipulates a "single set of standards." RESPONSE-The Health and Safety Code requires TDH and DHS to establish joint procedures and jointly develop one set of standards in compliance with federal regulations for Title XIX nursing homes. The proposed rules were developed pursuant to House Bill 7 and apply only to Title XIX nursing homes. Licensure rules are a separate issue and are established under a separate statutory authority. COMMENT 7-The commenter requests that DHS change "immediate jeopardy to health and safety" to "immediate and serious threat." RESPONSE-"Immediate jeopardy to health and safety" is federal language; therefore, DHS is adopting the language as proposed. COMMENT 8-The commenter requests a change to the definition of "severity" to clarify that the second part of the definition specifies how to measure the negative outcome. RESPONSE-The language as proposed tracks the language in the proposed federal rules on remedies. DHS believes that it is appropriate to adopt the federal language. COMMENT 9-The commenter requests a change to the definition of "severity" to indicate that a resident-rights violation would be considered serious before TDH imposes a remedy. RESPONSE-DHS believes that sec.19.2203, Resident-Related Contract Violations, and sec.19.2205, Monetary Penalties, already make this clear. COMMENT 10-The commenter requests a change to the definition of "survey" to reflect a recent administrative law judge's ruling that a complaint investigation cannot be called a survey. RESPONSE-The purpose of the definitions section is to define terms as they are used in these rules. The term "survey," in these rules, includes any action which could result in the citing of deficiencies leading to contract violations and resultant remedies. COMMENT 11-The commenter disagrees with the language in sec.19.2203, Resident- Related Contract Violations, which states that these remedies do not preclude the application of other lawful actions, particularly licensing actions. RESPONSE-Licensing and certification remedies are two separate systems established by separate statutory authority and, as such, can operate concurrently. COMMENT 12-The commenter requests addition of the following language to sec.19.2203(b): "The facility can give input that will be considered prior to the recommendation/imposition of a remedy." RESPONSE-DHS agrees and has added language that allows the facility to provide input prior to the recommendation or imposition of remedies. COMMENT 13-The commenter requests deletion of the requirement that a 90-day termination automatically requires a directed plan of correction. RESPONSE-DHS believes that the directed plan of correction is an important component of the remedies process. The proposed federal rules also contain a requirement for a mandatory plan of correction. COMMENT 14-The commenter requests addition of the federal definition for "standard survey." RESPONSE-There is no succinct federal definition of "standard survey." COMMENT 15-The commenter requests a change to sec.19.2204(b) from "may solicit information" to "must consider information and suggestions." RESPONSE-DHS cannot mandate that TDH consider information. COMMENT 16-The commenter asks what guidelines TDH will use for determining monetary penalties. RESPONSE-This issue is fully addressed in sec.19.2205, Monetary Penalties. COMMENT 17-The commenter requests that DHS require in sec.19.2205(1)(A)(i) that the owner be notified of recommendations for remedies if his address is different from that of the facility. RESPONSE-DHS believes that it is the owner's responsibility to maintain communication with the facility. DHS is adopting the paragraph as proposed. COMMENT 18-The commenter requests that DHS delete sec.19.2205(2)(E) which doubles monetary penalties when a facility erroneously reports that a contract violation has been corrected. RESPONSE-There is a similar provision in the proposed federal rules for increased penalties in this situation; therefore, DHS is adopting the language as proposed. COMMENT 19-The commenter requests that in sec.19.2206(b) DHS make a change to allow for an "informal hearing before a DHS official who was not involved with the initial decision." RESPONSE: DHS believes that this change is unnecessary. The original finding of noncompliance would have to be made by TDH. Therefore, a hearing by DHS would always be before an official who was not involved in the initial decision. COMMENT 20-The commenter requests addition of the following to the end of sec.19.2208(a)(2): "Accountability period will be based solely on three annual standard certification surveys." RESPONSE-DHS believes that any contract violation, whether found as part of the annual survey, or otherwise, must begin an accountability period. COMMENT 21-The commenter requests deletion from sec.19.2208(c) the phrase: "after the 30-day period." RESPONSE-This language was deleted previously. COMMENT 22-The commenter states that in sec.19.2209(b), the appeals provisions do not appear to apply to many of the remedies available to DHS and TDH. RESPONSE-It is true that not all of the remedies have an avenue for appeal. The proposed federal rules also do not allow appeals of every action. COMMENT 23-The commenter requests addition of clarifying language to sec.19. 2209. RESPONSE-Additional clarification is unnecessary. COMMENT 24-The commenter requested DHS to retitle sec.19.2211 "Scope" and delete references to debarment, since these rules do not apply to nursing facilities. RESPONSE-DHS has retained the title "Exclusions" because this section is in reference to entities which are excluded from Medicaid contracts. The reference to debarment also is retained. DHS's proposed debarment rules do apply to nursing facilities. COMMENT 25-The commenter suggests alternative language in sec.19.2209(a)(2) (A)(ii). RESPONSE-DHS believes that the language as proposed is clear and is therefore adopting the clause without changes. COMMENT 26-The commenter recommends deletion of "res judicata or" in sec.19. 2209(a)(2)(B). RESPONSE-DHS has instead deleted "conclusive." COMMENT 27-The commenter states that sec.19.2216, Transition Period, is an attempt to make the rules retroactive. RESPONSE-There will be no retroactive application of the new rules. This section merely holds nursing facilities accountable for past violations, according to the rules in effect at the time of the violations. The purpose of this section is to prevent a nursing facility with a history of serious violations from having that history erased. COMMENT 28-The commenter states that DHS's remedies rules must be consistent with HCFA's proposed enforcement rules. RESPONSE-DHS's intention is that Texas' remedies rules will be consistent with the final federal rules. COMMENT 29-The commenter states that the definition of "deficiency" is too broad. RESPONSE-What constitutes a deficiency is a survey issue. DHS does not address the survey process. COMMENT 30-The commenter states that the rules do not adequately convey the concept of scope. RESPONSE-The definition of scope was agreed upon by SPAC; therefore, DHS believes that no changes are necessary. COMMENT 31-The commenter states that the 23-day decertification track should be reserved for the most serious situations. RESPONSE-DHS agrees, and sec.19.2203(b)(1)(A) as proposed reflects this. COMMENT 32-The commenter states that the appointment of a temporary manager must be included as an option to the 23-day decertification. RESPONSE-Appointment of a temporary manager is an option under the OBRA law. DHS has chosen not to offer that option. The following 11 comments were received from TDH: COMMENT 1-sec.19.2202, Definitions ("Accountability period")-The commenter requests clarification of the definition. RESPONSE: DHS has clarified the definition by dropping the word "two" since more than two accountability periods could overlap. COMMENT 2-sec.19.2202, Definitions ("Plan of correction")-The commenter suggests adding firing to the list of options. RESPONSE: The list is not intended to be inclusive; therefore, DHS is adopting the definition as proposed. COMMENT 3-sec.19.2202, Definitions ("Scope")-The commenter states that it is unclear whether the 20% of residents surveyed includes residents referenced in deficiencies written from observations made on the orientation tour, sample residents only, or residents surveyed on an extended or partially extended survey. The commenter suggests using the word "observed" instead of "surveyed" to describe the residents and suggests adding "including observations during the orientation tour, any extended, partially extended, or investigation of any complaint." RESPONSE-DHS has changed the definition to read "the percentage of residents included in the survey" rather than "the percentage of residents surveyed." DHS is not adding the recommended language concerning observations because only deficiencies resulting from surveys which conform to the HCFA survey methods are addressed in these rules. COMMENT 4-sec.19.2202, Definitions ("Survey")-The commenter suggests adding to the definition: incident investigation, follow-up visits, quality assurance visits, off-hour visits, and monitoring visits. RESPONSE: The framework of these rules is based upon the HCFA survey method. Only surveys which are a part of the HCFA procedure are included under the definition of survey. COMMENT 5-sec.19.2203(a), Remedy Options-The commenter requests additional language specifying other actions not precluded by these rules. RESPONSE-DHS believes that the additional language is not needed. COMMENT 6-sec.19.2203(b), Application of Remedies-The commenter expresses concern that the requirement that the facility be notified of recommendation for remedies at the on-site exit conference would limit TDH's options for imposing additional remedies at a later date. RESPONSE: The rule requires that remedies be recommended at the exit conference. Imposition of the remedies must be within 10 days of the exit conference. The "recommendation" is not the final word, but rather the surveyor's best estimate of what will occur. The "imposition" is final and allows 10 days for the regional or central office review teams to consider the results and implications of the survey. COMMENT 7-sec.19.2203(b)(1)(A), Immediate Jeopardy to Health and Safety-The commenter recommends substituting "justifiable" for "necessary." RESPONSE: DHS believes that "necessary" is a more appropriate choice in this instance. COMMENT 8-sec.19.2203(b)(1)(C), Violations Not Limiting the Rendering of Adequate Care-The commenter expresses concern that for violations falling into this category, aside from a state-directed plan of correction, there is nothing that can be done to enforce the requirement. RESPONSE-DHS is adopting this section with a change to comply with the Omnibus Budget Reconciliation Act (OBRA) which requires the denial of payment for new Medicaid admissions whenever a facility fails to correct contract violations within three months of the date of the citation. COMMENT 9-sec.19.2205, Monetary Penalties-The commenter expresses concern that no penalty exists if the facility does not pay. RESPONSE-DHS believes that avenues already exist for addressing this eventuality. COMMENT 10-sec.19.2206, Denial of Payment for New Medicaid Admissions-The commenter takes issue with the process for denial of payment for new Medicaid admissions. RESPONSE-The language in this section is taken directly from federal regulations. DHS believes it is necessary to retain the language as proposed. COMMENT 11-The commenter expresses a general concern that, because HCFA prohibits citing facilities for deficiencies which occurred but were fully corrected prior to a survey, no remedies are available to address such circumstances. RESPONSE-These rules are based on the OBRA law which correlates with the survey process. Only violations which can be cited during a survey will be addressed by these rules. In addition to changes resulting from comments received during the comment period, DHS is making the following editorial changes for clarity: In sec.19.2203(b)(1)(B), DHS is adding a reference to sec.19.2204. In sec.19.2205, DHS has clarified the language found in the introductory paragraph, reformatted paragraph (2)(D), incorporated subparagraph (E) into paragraph (2), and changed subparagraph (F) to (E). In sec.19.2207(3), DHS has changed the term "provider agreement" to "contract" for consistency. In sec.19.2208, DHS has deleted from subsection (b) the phrase "or fails to renew" and has made a technical change to subsection (c)(1) because of a new HCFA ruling that prohibits time-limited agreements. In subsection (b)(1), DHS has added the phrase "to community care" at the request of the SPAC to specifically identify community care as an alternative when residents are moved out of a nursing facility which loses its Medicaid contract. In sec.19.2209(a)(1), DHS has added "excluding interest" in reference to the amount of the monetary penalty assessed against a nursing facility. In paragraph (2)(A), DHS has made an editorial change moving "unless" to the end of the subparagraph for clarity. 40 TAC sec.19.2012 The repeal is adopted under the Human Resources Code, Title 2, Chapter 32. 021(d)-(g) and 32.024(a), which provides the department with the authority to levy and collect remedies from nursing facilities that fail to meet Long Term Care Nursing Facility Requirements for Licensure and Medicaid Certification, as cited by surveyors for the Texas Department of Health. 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 December 15, 1992. TRD-9216659 Nancy Murphy Agency Liaison, Policy and Document Support Texas Department of Human Services Effective date: February 1, 1993 Proposal publication date: August 4, 1992 For further information, please call: (512) 450-3765 Subchapter W. Remedies for Violations of Title XIX Nursing Facility Provider Agreements 40 TAC sec.sec.19.2201-19.2209, 19.2211-19.2216 The new sections are adopted under the Human Resources Code, Title 2, Chapter 32.021(d)-(g) and 32.024(a), which provides the department with the authority to levy and collect remedies from nursing facilities that fail to meet Long Term Care Nursing Facility Requirements for Licensure and Medicaid Certification, as cited by surveyors for the Texas Department of Health. sec.19.2202. Definitions. The following words and terms, when used in this subchapter, shall have the following meanings, unless the context clearly indicates otherwise. Accountability period -A 24-month period which begins each time a facility is cited for a resident-related contract violation. Accountability periods may overlap. Compliance letter -Written notification to the facility by the state survey agency of a resident-related contract violation, which, if not corrected within a stated time frame, will result in the imposition of a more stringent remedy. Contract violation -The failure of a Medicaid-contracted nursing facility to comply with any of the terms of the Medicaid provider agreement. These failures may include resident-related deficiencies, nonresident-related deficiencies, and administrative violations of other applicable agency rules or contractual provisions. All contract violations cited during a single survey are considered in the aggregate for purposes of proposing remedies under this subchapter. Deficiency-Noncompliance with a regulatory requirement for participation. A deficiency may be cited if there are situations identified during the course of a survey of sufficient severity and/or frequency that indicate an individual requirement is not met. Immediate jeopardy to health and safety-A situation in which there is a high probability that serious harm or injury to residents could occur at any time or already has occurred and may well occur again if residents are not protected effectively from the harm or if the threat is not removed. New Medicaid admission-The admission of a Medicaid-eligible individual who has never been previously admitted to the facility or who, if previously admitted, was discharged or voluntarily left the facility. New admissions do not include individuals who: (A) lived in the facility before the effective date of denial of payment for new admissions, even if the individuals become eligible for Medicaid after that date; (B) are readmitted to beds reserved for them, after a temporary absence from the facility for a therapeutic visit as described in sec.19.1703 of this title (relating to Therapeutic Home Visits Away from the Facility); or (C) are readmitted to the same facility after a hospital stay. On-Site Monitoring -Regular observation, as needed, of a facility by the state survey agency until the facility has demonstrated that it is in compliance with the requirements for participation and that it will remain in compliance. Plan of correction -A written strategy for correcting a contract violation. A plan of correction may be developed by the facility and, in certain situations, directed by the state survey agency. Directed plans of correction may include, but are not limited to, requiring the facility to hire nursing, dietary, pharmacy, or management consultants; to hire additional staff; and to make structural repairs or renovations. The preceding examples are listed without regard to priority. Requirements for participation-The single set of standards that are adopted by the Texas Department of Human Services (DHS) and that govern participation in the Medicaid nursing facility program. Scope-The percentage of the residents included in the survey who are affected by a facility's deficiencies cited in a single survey. The state survey agency determines the scope of a facility's deficiencies when recommending monetary penalties. Scope may vary as follows: (A) "An isolated or occasional occurrence" affects up to and including 20% of the residents surveyed. (B) "A pattern of occurrence," or "a widespread, pervasive occurrence" affects more than 20% of the residents surveyed. Severity-The level of seriousness of the sum of deficiencies in a facility, considering the actual and/or potential resident harm that did or could occur in that facility. The state survey agency determines the level of severity of a facility's deficiencies when recommending monetary penalties. The levels of severity are: (A) "No harm or likely potential for harm." No negative resident outcome or resident rights violation has occurred or is likely to occur, nor has the ability of the individual to achieve the highest practicable physical, mental, or psychosocial well-being been compromised or is likely to be compromised. (B) "A potential for harm." If the deficiencies continue over time, a negative outcome or a resident rights violation would likely occur, and/or the ability of the individual to achieve the highest practicable physical, mental, or psychosocial well-being would, or would likely, be compromised. (C) "Actual harm." A negative outcome or resident rights violation has occurred, and/or the ability of the individual to achieve the highest practicable physical, mental, or psychosocial well-being is, or has been, compromised. (D) "Actual life-threatening harm or resident death." Life-threatening harm, severe impairment, or death has occurred. Survey-All surveys, including standard, extended, partially extended, or those which result from a complaint. Survey performance is inadequate if the state survey agency fails to use federal standards and protocols and the forms, methods, and procedures specified by the Health Care Financing Administration (HCFA) in its State Operations Manual. Inadequate survey performance does not relieve a facility of its obligations to meet all the requirements for participation, nor does it invalidate adequately documented deficiencies. Vendor hold-A remedy consisting of withholding vendor payment. Vendor hold is used for administrative contract violations such as trust fund violations, delayed cost reports, or late occupancy reports. sec.19.2203. Resident-Related Contract Violations. (a) Remedy options. The remedies described in this section do not preclude the application of other lawful actions, such as the licensing agency actions under Chapter 242 of the Texas Health and Safety Code. Possible remedies for resident- related contract violations, listed without regard to priority, are as follows. (1) State survey agency remedy options: (A) facility-developed plan of correction as specified in subsection (b) (1)(C) of this section; (B) compliance letter as specified in subsection (b)(1)(C) of this section; (C) directed plan of correction as specified in sec.19.2204 of this title (relating to Directed Plan of Correction); (D) on-site monitoring as specified in subsection (b)(1)(A) and (b)(1) (B) of this section; (E) proposal to terminate certification for Medicaid participation as specified in subsection (b)(1)(A) and (b)(1)(B) of this section; (F) termination of certification for Medicaid participation as specified in 25 Texas Administrative Code sec.sec.145.141-145.147. (2) DHS remedy options: (A) monetary penalties as specified in sec.19.2205 of this title (relating to Monetary Penalties); (B) denial of payment for new Medicaid admissions as specified in sec.19. 2206 of this title (relating to Denial of Payment for New Medicaid Admissions); (C) contract cancellation as specified in sec.19.2208 of this title (relating to Contract Cancellation for Resident-Related Contract Violations). (b) Application of remedies. The state survey agency must notify the facility of recommendations for remedies during the on-site exit conference. The facility may give input that will be considered prior to the recommendation or imposition of remedies. Facilities will be notified by the state survey agency of the imposition of remedies within 10 days of the on-site exit conference. The state survey agency must observe the following guidelines to ensure standard and consistent recommendations for remedies. (1) Facilities cited for resident-related contract violation. Each time a facility is cited for a resident-related contract violation, as described in subparagraphs (A) and (B) of this paragraph, an accountability period begins on the date the facility is cited. (A) Immediate jeopardy to health and safety. When the surveyors determine that a facility's contract violation immediately jeopardizes the health or safety of its residents, the state survey agency takes immediate action to remove the jeopardy and correct the contract violation through a proposal to terminate the facility's Medicaid certification in 23 days. If a facility notifies the state survey agency that the threat has been corrected, the state survey agency makes an on-site verification. The facility's certification is terminated and the Medicaid contract expires on the 23rd day unless the state survey agency has conducted an on-site verification and confirmed that the jeopardy has been removed. Additionally, one or more of the remedies described in clauses (i)- (iii) of this subparagraph may also be applied if, in the judgment of the state survey agency, it is necessary to cause the facility to achieve and maintain compliance and/or to protect the health and safety of the residents: (i) on-site monitoring to ensure continued compliance; (ii) denial of payment by the Texas Department of Human Services (DHS) for all new Medicaid admissions; (iii) monetary penalties as specified in sec.19.2205 of this title (relating to Monetary Penalties). (B) No immediate jeopardy to health and safety. If the surveyors determine that a facility's contract violation does not immediately jeopardize the health or safety of its residents, but does, or did, pose a health and/or safety hazard, or limits, or limited, the facility's capacity to render adequate care, the state survey agency proposes to terminate the facility's Medicaid certification within 90 days from the date of the on-site exit conference. In addition, the state survey agency imposes a directed plan of correction, as specified in sec.19.2204 of this title (relating to Directed Plan of Correction), which addresses the facility's specific circumstances. The facility is responsible for paying all costs incurred to correct the deficiencies. (i) Additionally, one or more of the remedies described in subparagraph (A) of this paragraph may also be applied if, in the judgment of the state survey agency, it is necessary to cause the facility to achieve and maintain compliance and/or to protect the health and safety of the residents. (ii) If a facility has not corrected the contract violation within 90 days from the date of the exit conference, the facility's Medicaid certification is terminated. (iii) If a facility has not corrected the contract violation within three months of the on-site exit conference, DHS denies payment for all new Medicaid admissions, as described in sec.19.2206 of this title (relating to Denial of Payment for New Medicaid Admissions). (C) Violations not limiting rendering of adequate care. Violations which do not limit the facility's capacity to render adequate care result in a facility- developed plan of correction and/or a compliance letter. If a contract violation is not corrected within three months of the date of the citation, denial of payment for new Medicaid admissions and the additional remedy described in subsection (a)(1)(C) of this section are applied. Contract violations described in this subparagraph are not considered for purposes of contract cancellation as described in sec.19.2208 of this title (relating to Contract Cancellation for Resident-Related Contract Violations) or for monetary penalties as described in sec.19.2205 of this title (relating to Monetary Penalties). (2) Second contract violation. The second time, within an accountability period, the state survey agency notifies DHS in writing of a resident-related contract violation and recommends or imposes remedies: (A) for a contract violation as described in paragraph (1)(A) of this subsection, the same remedies apply, except for the monetary penalties which are increased as specified in sec.19.2205(1)(B) of this title (relating to Monetary Penalties); (B) for a contract violation as described in paragraph (1)(B) of this subsection, the same remedies apply, except for the monetary penalties which are increased as specified in sec.19.2205(1)(B) of this title (related to Monetary Penalties). (3) Third contract violation. The third time, within an accountability period, the state survey agency notifies DHS in writing of a resident-related contract violation, as described in paragraph (1)(A) or (B) of this subsection, and recommends or imposes remedies, the following occur: (A) DHS terminates the Medicaid contract; (B) if the recommended or imposed remedies are the result of three standard surveys, until the Medicaid termination is effective, DHS: (i) denies payment for new Medicaid admissions; and (ii) requires on-site monitoring of the facility. (4) Remedies overturned on appeal. Remedy recommendations which have been overturned on an appeal to the appropriate state agency or a court of law are not considered for purposes of contract cancellation as described in sec.19. 2208(a)(2) of this title (relating to Contract Cancellation for Resident-Related Contract Violations) or for monetary penalties as described in sec.19.2205 of this title (relating to Monetary Penalties). (5) Facility limitations on recipient charges. A facility must not charge Medicaid recipients, their families, or their responsible parties to recoup any vendor payments not received because of the imposition of remedies against the facility. The facility may collect only the applied income established in the resident's payment plan. sec.19.2205. Monetary Penalties. Each time a facility is cited for resident- related contract violations, as specified in sec.19.2203(b)(1) of this title (relating to Resident-Related Contract Violations), an accountability period begins on the date the facility is cited. Monetary penalties may be imposed whether or not the facility has a plan of correction acceptable to the state survey agency. (1) Application of monetary penalties. (A) The first time a facility is cited for a resident-related contract violation, an accountability period begins, and monetary penalties are assessed as follows, based upon the recommendation of the state survey agency: (i) Immediate jeopardy to health and safety. If the violation immediately jeopardizes the health or safety of its residents, the Texas Department of Human Services (DHS) notifies the facility in writing of the following monetary penalties. (I) A severity of "actual life-threatening harm or resident death," in combination with any level of scope, results in monetary penalties of $10 per day per certified Medicaid bed, for every day the facility is out of compliance, for a minimum of 15 days beginning with the date of the on-site visit exit conference by the state survey agency. (II) A severity of "actual harm": (-a-) with a scope of more than 20% results in monetary penalties of $7. 50 per day per certified Medicaid bed, for every day the facility is out of compliance, for a minimum of 15 days beginning with the date of the on-site visit exit conference by the state survey agency; (-b-) with a scope of up to and including 20% results in monetary penalties of $5.00 per day per certified Medicaid bed, for every day the facility is out of compliance, for a minimum of 15 days beginning with the date of the on-site visit exit conference by the state survey agency. (III) A severity of "a potential for harm" with a scope of more than 20% results in monetary penalties of $5.00 per day per certified Medicaid bed, for every day the facility is out of compliance, for a minimum of 15 days beginning with the date of the on-site visit exit conference by the state survey agency. (ii) No immediate jeopardy to health and safety. If the violation does not immediately jeopardize the health or safety of the facility's residents, but does or did pose a health and/or safety hazard, or limits or limited the facility's capacity to render adequate care, DHS notifies the facility in writing of the following monetary penalties. (I) A severity of "actual harm": (-a-) with a scope of more than 20% results in monetary penalties of $5. 00 per day per certified Medicaid bed, for every day the facility is out of compliance, for a minimum of 15 days beginning with the date of the on-site visit exit conference by the state survey agency; (-b-) with a scope of up to and including 20% results in monetary penalties of $2.50 per day per certified Medicaid bed, for every day the facility is out of compliance, for a minimum of 15 days beginning with the date of the on-site visit exit conference by the state survey agency. (II) A severity of "potential for harm" with a scope of more than 20% results in monetary penalties of $2.50 per day per certified Medicaid bed, for every day the facility is out of compliance, for a minimum of 15 days beginning with the date of the on-site visit exit conference by the state survey agency. (iii) If a resident-related contract violation constitutes the second violation within an existing accountability period, monetary penalties are assessed according to subparagraph (B) of this paragraph. (B) The second time a facility is cited for a resident-related contract violation within an accountability period, penalties are assessed as follows, upon recommendation of the state survey agency: (i) Immediate jeopardy to health and safety. If the violation immediately jeopardizes the health or safety of its residents, DHS notifies the facility in writing of the following monetary penalties: (I) A severity of "actual life threatening harm or resident death" in combination with any level of scope results in monetary penalties of $20 per day per certified Medicaid bed, for every day the facility is out of compliance, for a minimum of 15 days beginning with the date of the on-site visit exit conference by the state survey agency. (II) A severity of "actual harm": (-a-) with a scope of more than 20% results in monetary penalties of $15 per day per certified Medicaid bed, for every day thefacility is out of compliance, for a minimum of 15 days beginning with the date of the on-site visit exit conference by the state survey agency. (-b-) with a scope of up to and including 20% results in monetary penalties of $10 per day per certified Medicaid bed, for every day the facility is out of compliance, for a minimum of 15 days beginning with the date of the on-site visit exit conference by the state survey agency. (III) A severity of "a potential for harm" with a scope of more than 20% results in monetary penalties of $10 per day per certified Medicaid bed, for every day the facility is out of compliance, for a minimum of 15 days beginning with the date of the on-site visit exit conference by the state survey agency. (ii) No immediate jeopardy to health and safety. If the violation does not immediately jeopardize the health or safety of its residents, but does or did pose a health and/or safety hazard, and/or it limits or limited the facility's capacity to render adequate care, DHS notifies the facility in writing of the following monetary penalties: (I) A severity of "actual harm": (-a-) with a scope of more than 20% results in monetary penalties of $10 per day per certified Medicaid bed, for every day the facility is out of compliance, for a minimum of 15 days beginning with the date of the on-site visit exit conference by the state survey agency; (-b-) with a scope of up to and including 20% results in monetary penalties of $5.00 per day per certified Medicaid bed, for every day the facility is out of compliance, for a minimum of 15 days beginning with the date of the on-site visit exit conference by the state survey agency. (II) A severity of "potential for harm," with a scope of more than 20% results in monetary penalties of $5.00 per day per certified Medicaid bed, for every day the facility is out of compliance, for a minimum of 15 days beginning with the date of the on-site visit exit conference by the state survey agency. (2) Duration and payment of monetary penalties. (A) Unless the penalties are appealed, payment of assessed monetary penalties must be received in full by DHS within 20 days of receipt of a certified letter from DHS to the facility stipulating the amount of monetary penalties. (B) Unless the facility appeals as specified in sec.19.2209 of this title (relating to Appeals Process for Resident-Related Contract Violations), interest on the monetary penalties accrues from the 21st day of receipt of the certified letter until paid, and at the rate of interest in effect during the interest period for judgments of the courts of Texas, as provided in Texas Civil Statutes, Article 5069-1.05, sec.2. (C) Monetary penalties cease the same date as decertification or contract cancellation. (D) Unless the facility is decertified or its contract is canceled, monetary penalties continue for a minimum of 15 days or until the survey agency is assured that the contract violation is corrected, whichever is later. The state survey agency may be notified in writing by the facility that the contract violation was corrected. The state survey agency staff must find on a subsequent visit that the contract violation was in fact corrected. (i) Monetary penalties as described in this section will cease on the 16th day or the date of notification to the state survey agency, whichever is later, if: (I) the state surveyors are unable to revisit the facility within five days after the date that the facility provided notification that the contract violation was corrected; and (II) the contract violation is later shown to be corrected based upon observation by the state survey agency and/or written documentation by the facility. (ii) If, on a subsequent visit, the state survey agency determines that the contract violation was in fact not corrected, the state survey agency notifies DHS, and DHS will double the most recent assessment of monetary penalties, effective the date the contract violation was erroneously reported corrected, and DHS will continue the assessment until the contract violation is corrected. (E) DHS applies all funds collected, as a result of monetary penalties, to the protection of the health and property of residents of nursing facilities that DHS or the Health Care Financing Administration (HCFA) finds deficient. Funds may be used for the cost of relocating residents to other facilities, for maintenance or operation of a facility pending correction of a contract violation or closure, and for reimbursement of residents for lost personal funds. sec.19.2207. Administrative Contract Violations. If a facility has been cited in writing by the Texas Department of Human Services (DHS) for failure to meet nonresident- related requirements, other applicable agency rules, or contractual provisions, DHS takes the following action. (1) DHS grants the facility a compliance period of no more than 30 days to correct a contract violation. At the end of the compliance period, if DHS determines that a contract violation is not corrected, but determines that the facility has made substantial progress toward correcting the contract violation, DHS may grant an additional one-time extension period of up to 15 days. (2) If the contract violation is not corrected within the compliance period, DHS imposes vendor hold on state Medicaid payments to the facility. (3) If a contract violation is not corrected within 60 days from the date the facility is placed on vendor hold, DHS cancels the facility's contract on the 61st day. A facility may request an informal reconsideration and/or an appeal hearing. A request for an informal reconsideration must be submitted in writing to Provider Services, Texas Department of Human Services, P.O. Box 149030, Austin, Texas 78714-9030. Regulations governing these appeals are specified in sec.79.1605(a) of this title (relating to Request for a Hearing). If the facility appeals the contract cancellation by DHS and the adverse action is sustained by an administrative law judge or judicial proceeding, the effective date of the contract cancellation is the date the administrative law judge's decision becomes final. Unless otherwise provided for in this section, DHS makes no payment for services provided by the facility after the effective date of the facility's contract cancellation. DHS may continue payments for no more than 30 days from the date DHS cancels or fails to renew a facility's contract if the state survey agency notifies DHS in writing, or DHS determines, that: (A) reasonable efforts are being made to transfer the residents to another facility or to alternate care; and (B) additional time is needed to effect an orderly transfer of the residents. sec.19.2208. Contract Cancellation for Resident-Related Contract Violations. (a) The Texas Department of Human Services (DHS) notifies the facility in writing of its intention to cancel the facility's contract when either of the following situations occur. (1) The state survey agency terminates the facility's certification. DHS makes no payment for services provided by the facility after the effective date of the termination of a facility's certification. (2) The facility has received three notifications within an accountability period of resident-related contract violations and recommendations for or imposition of remedies, excluding facility-developed plans of correction or compliance letters. (A) If the contract cancellation is not appealed, the contract is canceled on the 20th day after the facility receives notice of DHS's decision to cancel the contract. (B) If the contract cancellation is appealed, the contract will be canceled on the date the administrative law judge's decision upholding the cancellation becomes final. (b) DHS may continue payments for no more than 30 days from the date DHS cancels a facility's contract if the state survey agency notifies DHS in writing that: (1) reasonable efforts are being made to transfer the residents to another facility, to community care, or to other alternate care; and (2) additional time is needed to effect an orderly transfer of the residents. (c) When a facility's contract is canceled by DHS under the provisions of subsection (a) of this section, there is a 30-day period of no vendor payment to the facility. If the facility reapplies for a contract, the state survey agency conducts an on-site visit and notifies DHS whether or not the facility is complying with Medicaid requirements. If the facility is complying with Medicaid requirements and a contract with the facility is not prohibited by DHS debarment rules, DHS enters into a 30-day probationary contract with the facility. After the probationary period, if the state survey agency notifies DHS that: (1) the facility is complying with Medicaid requirements, DHS enters into a nonprobationary contract as specified in sec.19.2005(a)(1) or (3) of this title (relating to Contract Requirements); (2) the facility is not complying with Medicaid requirements, no contract can be issued. An additional 30-day period of no vendor payment begins. The facility must be in compliance with Medicaid requirements before applying for a probationary contract with DHS, according to the procedures stated in this subsection. sec.19.2209. Appeals Process for Resident-Related Contract Violations. (a) Facilities may appeal the application of the Texas Department of Human Services (DHS) remedies listed in sec.19.2203(a)(2) of this title (relating to Resident-Related Contract Violations) by requesting an informal reconsideration and/or an appeals hearing. A request for an informal reconsideration must be submitted in writing to Provider Services, Texas Department of Human Services, P.O. Box 149030, Austin, Texas 78714-9030. Appeal procedures involving state statutes, monetary penalties, and Title XIX nursing facility contracts are held in accordance with sec.sec.79.1601-79.1614 of this title (relating to Contract Appeals). (1) Monetary penalties. If a facility requests an appeals hearing, no monetary penalties are collected until the outcome of the hearing. The appeals hearing on the monetary penalties may not be held until the nursing facility has been notified of the total amount of the penalty (excluding interest). Interest on the assessed monetary penalties is calculated at the rate of interest in effect during the interest period for judgments of the courts of Texas, as provided in Texas Civil Statutes, Article 5069-1.05, sec.2. The interest period begins on the date of the written request by the facility for an appeals hearing and ends on the date the monetary penalties are paid. (A) Assessed monetary penalties and any interest must be paid in full within 20 days of receipt of a certified letter from DHS of the amount of the monetary penalties. (B) No monetary penalties or interest are charged the facility if the appeals hearing results in the administrative law judge (ALJ) or judicial proceeding overturning the initial decision. (2) Contract cancellation. (A) In an appeals hearing regarding contract cancellation resulting from three recommendations for remedies, as specified in sec.19.2208(a)(2) of this title (relating to Contract Cancellation for Resident-Related Contract Violations), the facility may challenge the contract violation(s) that are the basis for the cancellation, as specified in sec.sec.79.1601- 79.1614 of this title (relating to Contract Appeals), unless: (i) the facility was given an opportunity for a hearing previously on the same violations and did not request a hearing within the required time limit; or (ii) a final decision has been rendered by a DHS ALJ in a prior hearing on the same violations, and the ALJ upheld the violations. Prior failure to request a hearing or a final decision(s) in a prior hearing as described in this subparagraph are considered res judicata, that is, conclusive proof of the prior violations. (B) In an appeals hearing involving contract cancellation resulting from decertification, as specified in sec.19.2208(a)(1) of this title (relating to Contract Cancellation for Resident-Related Contract Violations), the final decision rendered by the state survey agency in the termination of certification hearing is considered res judicata of the issue of decertification. (b) Facilities may appeal termination of certification to the state survey agency under Texas Administrative Code, Chapter 45, sec.sec.145.141-145. 147 (relating to Procedures Covering Certification and Termination of Certification of Long-Term Care Facilities which Participate in the Title XIX Medical Assistance Program). 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 December 15, 1992. TRD-9216660 Nancy Murphy Agency Liaison, Policy and Document Support Texas Department of Human Services Effective date: February 1, 1993 Proposal publication date: August 4, 1991 For further information, please call: (512) 450-3765