Proposed Sections Before an agency may permanently adopt a new or amended section, or repeal an existing section, a proposal detailing the action must be published in the Texas Register at least 30 days before any action may be taken. The 30-day time period gives interested persons an opportunity to review and make oral or written comments on the section. Also, in the case of substantive sections, a public hearing must be granted if requested by at least 25 persons, a governmental subdivision or agency, or an association having at least 25 members. Symbology in proposed amendments. New language added to an existing section is indicated by the use of bold text. [Brackets] indicate deletion of existing material within a section. TITLE 16. ECONOMIC REGULATION Part III. Texas Alcoholic Beverage Commission Chapter 55. Bingo Regulation and Tax 16 TAC sec.55.542 The Texas Alcoholic Beverage Commission proposes an amendment to sec.55. 542, concerning investigation of applicants for licenses. The amendment amends subsection (c) to allow commissioned peace officers to use criminal history information received by the commission from law enforcement agencies. Thomas L. Byrd, director of auditing and tax reporting, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Byrd also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be a clearer understanding of who has access to criminal history information received by the Commission. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Jeannene Fox, Director, Bingo Division, P.O. Box 13127, Austin, Texas 78711, (512) 206-3276. The amendment is proposed under Texas Civil Statutes, Article 179d, Bingo Enabling Act, sec.13e(f) and sec.16(a), which require the commission to adopt rules governing the custody and use of criminal history information and authorize the Commission to adopt rules relating to the enforcement and administration of the Bingo Enabling Act. sec.55.542. Investigation of Applicants for Licenses. (a)-(b) (No change.) (c) Information received from the Texas Department of Public Safety, the Federal Bureau of Investigation, or any other law enforcement agency may be used only by the Director of the Bingo Division, an employee of that division authorized in writing by the director, a commissioned peace officer,
    or someone who exercises supervisory authority over the director. Criminal history information shall be kept under lock and key when not actually in use, and shall be destroyed by shredding or some other confidential method when no longer needed. (d)-(e) (No change.) This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317907 Gayle Gordon General Counsel Texas Alcoholic Beverage Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 206-3204 16 TAC sec.55.543 The Texas Alcoholic Beverage Commission proposes an amendment to sec.55. 543, concerning denials; suspensions; revocations; hearings. The amendment amends subsection (a) to specify that if an applicant does not request a hearing within 30 days of the denial of his application he waives his opportunity for a hearing. The amendment amends subsection (c) to delete references to when a hearing shall be held and when a suspension begins, since the Commission no longer conducts its own hearings; to delete a reference to the issuance of a temporary license, since a licensee generally may continue its activities under Texas Civil Statutes, Article 6252-13a, sec.18(b); to provide that a suspension should specify the number of occasions suspended, and to provide that a suspended lessor's license or license to conduct bingo may not be amended in certain respects. Thomas L. Byrd, director of auditing and tax reporting, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Byrd also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be clarification of the hearing and suspension procedure to reflect changes which have occurred since the Commission no longer conducts its own hearings. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the proposal. Comments on the proposal may be submitted to Jeannene Fox, Director, Bingo Division, P.O. Box 13127, Austin, Texas 78711, (512) 206-3276. The amendment is proposed under Texas Civil Statutes, Article 179d, Bingo Enabling Act, sec.16(a), which authorize the Commission to adopt rules relating to the enforcement and administration of the Bingo Enabling Act. sec.55.543. Denials; Suspensions; Revocations; Hearings. (a) Denial of application. If the Texas Alcoholic Beverage Commission (Commission) determines that an applicant is not eligible for a license, or that the license should be denied on grounds which would justify suspension or revocation of an existing license, it will notify the applicant in writing that the application has been denied and will state the reason for the denial. If the applicant desires to contest the denial, the applicant must, within 30 days of the date of the notice of denial, make a written request for a hearing to contest the denial. If the applicant does not request a hearing within 30 days after the date of the notice of denial, the opportunity for a hearing is waived and a notice that the denial has become final will be issued. (b) (No change.) (c) Hearings. (1) (No change.) (2) After a notice of proposed suspension or revocation has been served, the licensee or holder will have an opportunity for a hearing. [The hearing may be held within 20 days from the date the Commission receives the request.] If the licensee or holder does not request a hearing within 30 days after the date of the notice of proposed suspension or revocation, the opportunity for a hearing is waived and a final order will be issued. (3) After a hearing on the alleged violation and upon finding that a violation did occur, the Commission may suspend a license or temporary authorization for a period not to exceed one year or may revoke a license or temporary authorization. In a case involving a licensed authorized organization or a commercial lessor, any suspension should specify the number of occasions for which the license is suspended. Once a final order of suspension has been signed, the Commission may not process any amendment changing the playing days or times, the location of the games, or providing for a different commercial lessor until the suspension has been served.
      [The period of a suspension begins on the date of the order invoking the suspension, or the date of the order overruling the motion for rehearing, if one was filed.] [(4) In the event a licensee has requested an administrative hearing and has made timely and sufficient application for renewal of its license, the licensee may be issued a temporary authorization to conduct bingo and continue to act pursuant to said authorization until the Commission issues a final decision, regardless of whether said license has expired during the hearing process.] (d)-(e) (No change.) This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317908 Gayle Gordon General Counsel Texas Alcoholic Beverage Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 206-3204 16 TAC sec.55.544 The Texas Alcoholic Beverage Commission proposes an amendment to sec.55. 544, concerning definitions. The amendment amends the definition of "Bingo equipment and supplies" to delete markers and blotters, and to exclude cash registers, computers, and office equipment, amends the definition of "Charitable purposes" to include donations to community organizations in the examples of charitable purposes, amends the definition of "Location, premises, or place" to describe it in terms of a continuous attached structure and as including certain adjacent parking areas, clarifies the definition of "Operator" and amends the definition of "Sale" to delete a reference to markers and blotters. The amendment also adds definitions of "Member or membership," "Officer," and "Organizing instrument." Thomas L. Byrd, director of auditing and tax reporting, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Byrd also has determined that for each of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be clearer understanding of the Bingo Enabling Act and Rules resulting from more exact definitions of Terms used therein. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the proposal. Comments on the proposal may be submitted to Jeannene Fox, Director, Bingo Division, P.O. Box 13127, Austin, Texas 78711, (512) 206-3276. The amendment is proposed under Texas Civil Statutes, Article 179d, Bingo Enabling Act, sec.16(a) which authorize the Commission to adopt rules relating to the enforcement and administration of the Bingo Enabling Act. sec.55.544. Definitions. The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise. Bingo equipment and supplies-Items used, made, or sold for use in bingo games. (A) Bingo equipment and supplies include: (i)-(ii) (No change.) (iii) bingo cards, boards, sheets, [markers,] pads, [blotters,] and other supplies; and (iv) (No change.) (B) Bingo equipment does not include a bingo game set that is: (i) (No change.) (ii) sold for a retail price of $20 or less; [and] (iii) (No change.) (C)-(D) (No change.) (E) Bingo equipment and supplies also do not include cash registers, computers, and office equipment. Charitable purposes -one or more of the following activities: (A)-(D) (No change.) (E) Some examples of charitable purposes include the following: (i) Charitable. Donations to recognized organizations such as Cerebral Palsy, Muscular Dystrophy, the Heart Fund, American Cancer Society, and other nationally or locally recognized charities in Texas including community organizations whose primary purpose is to assist in matters of sexual and physical abuse, family economic support, or health care assistance; (ii)-(iv) (No change.) Location, premises, or place-All the area in a continuous attached
        [under the exterior roof of any building and/or] structure, and any parking area adjacent to the structure and leased under the same lease or purchased under the same deed. Separate structures which share the same parking area are not one premises.
          [regardless of whether title or leasehold interest in all or any part of such building and/or structure may be in the name of one or more persons.] For all purposes of licensing and regulation of the lease of bingo premises and/or the conduct of bingo, the terms "location," "premises," and "place" shall each have this meaning. The fact that the United States postal service or a local political subdivision has assigned or may assign separate mailing addresses or subaddresses to areas within the [building and/or] structure, the fact that internal walls may have been erected, or the fact that areas within a [building or] structure have separate utility connections or property tax listings, will not operate to subdivide a [building or] structure so as to create more than one location, premise, or place for the conduct of bingo. This provision as amended
            applies to all initial applications for commercial lessor licenses submitted after the effective date of this amendment. The provisions of this rule in effect before the effective date of this amendment apply to all initial applications for commercial lessor licenses received before that date and after
              May 4, 1987. Member or membership -The natural person or persons designated in an organization's organizing instrument as being the active members of the organization. Honorary members or individuals who have joined the organization for the purpose assisting in the conduct of its bingo games are not members. Since the commission realizes that a nonprofit organization's organizing instruments are frequently inaccurate in describing how the organization actually operates, if an applicant proves that it has actually had persons carrying on all of the activities usually carried on by members, that applicant may amend its organizing instruments to correspond to the way it is actually organized. If the applicant is a nonprofit organization whose officers must be elected as provided in Texas Civil Statutes, Article 179d, sec.2(3)(B)(i), the commission will consider only those members who have voting rights in electing the officers or in electing the delegates who elect them as being the only members of the applicant organization, since the alternative would be to deny the application. Officer-Those persons designated as officers in an organization's organizing instrument. The term includes, but is not limited to, an organization's president, vice president, secretary, treasurer, directors, and trustees or persons performing the same duties with a different title, such as commander or potentate. Organizing instrument -A document by virtue of which an organization is formed or operates and which specifies its organizational structure, membership, and purposes. The organizing instruments of a corporation are its Articles of Incorporation and its By-laws. The organizing instrument of an unincorporated association is its constitution or by-laws. Operator-The active bona fide member or members of a licensed organization designated as the person or persons in charge of and primarily responsible for each bingo occasion. The operator whether it be the primary operator or an alternate operator
                must supervise all activities and be responsible for the conduct of all bingo games on the occasion of which he or she is in charge. He or she must be present on the premises continually during the occasion. Sale-For the purposes of the Bingo Enabling Act, sec.11(o) and sec.13c(i), the term "sale" includes installment plan purchases by licensed authorized organizations or exempt entities under the Bingo Enabling Act, sec.39(b)(3) or (4), of bingo equipment other than bingo cards, boards, sheets, [markers,] or
                  pads[, or blotters]. The due date of each installment payment is considered the date of actual delivery. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317909 Gayle Gordon General Counsel Texas Alcoholic Beverage Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 206-3204 16 TAC sec.55.545 The Texas Alcoholic Beverage Commission proposes an amendment to sec.55. 545, concerning licenses, fees, and bonds for conduct of bingo and commercial lessor. The amendment amends subsection (a) to require the Commission to notify applicants of pending administrative action involving their proposed location, to give the Commission discretion concerning the revocation of bonds, to specify what factors the Commission shall consider in reviewing an application of an organization to move from one commercial hall to another, and to provide a procedure for placing on inactive status the license of an organization which has voluntarily surrendered possession of the licensed premises. The amendment amends subsection (b) to delete the requirement for a bond of $99 or less and to give the Commission discretion concerning the revocation of bonds. The amendment amends subsection (c) to allow applications for temporary licenses on a different form approved by the Commission, amends subsection (f) to delete a reference to payment of a cash bond and to specify the manner in which the fee on an original application must be paid, amends subsection (l) to require notification of changes in the information in an application within 10 days, and amends subsection (m) to allow only operators or officers of a licensed organization or officers or a designated business contact of a commercial lessor to act as representatives of that organization or lessor. The amendment also adds a new subsection (n) requiring that a licensed organization or applicant may use only its primary business address as its mailing address. Thomas L. Byrd, director of auditing and tax reporting, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering this section. Mr. Byrd also has determined that for each of the first five years the section is in effect, the public benefit anticipated as a result of enforcing the section will be an expedited licensing process resulting from clarification of current procedures and prevention of recurring litigation by providing a method of placing licenses in inactive status. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the proposal. Comments on the proposal may be submitted to Jeannene Fox, Director, Bingo Division, P.O. Box 13127, Austin, Texas 78711, (512) 206-3276. The amendment is proposed under Texas Civil Statutes, Article 179d, Bingo Enabling Act, sec.16(a), which authorize the Commission to adopt rules relating to the enforcement and administration of the Bingo Enabling Act. sec.55.545. Licenses, Fees, and Bonds for Conduct of Bingo and Commercial Lessor. (a) Annual license to conduct bingo games. (1)-(2) (No change.) (3) License. (A)-(D) (No change.) (E) If an applicant is applying to conduct bingo at a location where administrative action is pending against the commercial lessor or any of the organizations conducting bingo there, the Commission shall notify the applicant of the pending action and its possible effects on the applicant. (4) Bond or other security. Each application for an annual license to conduct bingo must be accompanied by a bond or other security equal to the applicant's estimated quarterly tax liability. If the amount is estimated to be less than $1,900, no bond or other security will be required, unless the Commission determines a bond or other security is necessary based on the applicant's history at recordkeeping, reporting, and payment of tax. No new bond will be required upon renewal if the licensee would be eligible to have an existing bond released under subparagraph (D) of this paragraph. If a bond or other form of security is required, no license will be issued until such bond or other security has been posted. (A)-(B) (No change.) (C) Forfeiture. If a licensee pays less than the amount of tax due under the Act, the Commission may
                    [will] notify both the licensee and any surety of the delinquency by jeopardy or deficiency determination. If payment is not made by the demand date stated in the notice, the Commission may
                      [will] forfeit the bond or security or any part of the bond or security necessary to pay the proper amount of tax. Failure to pay any delinquency when due is grounds for suspension or revocation of the licensed organization's right to conduct bingo. (D)-(E) (No change.) (5) Application to conduct bingo at premises of a commercial lessor. (A) -(B) (No change.) (C) If an organization that is licensed to conduct bingo applies to amend its license to move to the premises of another commercial lessor, the Commission, in determining whether or not to amend the license shall consider the following factors: (i) will the rent be increased or decreased; (ii) will the new facilities be in a better or more desirable location: (iii) have there been problems concerning lessor involvement or lessor violations of the lease at either location; and (iv) has the organization been making or losing money at the old location and how do those receipts and expenses compare to those of other organizations already conducting bingo at the new location. (6) Inactive status. (A) If an organization holding an annual license to conduct bingo voluntarily surrenders possession of the licensed premises to a licensed commercial lessor that lessee or that lessor may request in writing that the lessee's license be placed in inactive status. The lessor shall include with its request a copy of its termination notice to the lessee which complies with the notice requirements of the lease (except under subparagraph (B)(iii) of this paragraph) and an affidavit that the lessee has voluntarily surrendered possession of the premises. The purposes of this action are to allow the lessee to retain its license while seeking another location, to allow the lessor to lease to another licensed organization to replace the inactive lessee, and to prevent loss of bingo receipts to any organization playing bingo at that location on the same day as the inactive lessee is licensed to conduct bingo. (B) A lessee will be considered to have voluntarily surrendered possession of the licensed premises in any of the following three situations: (i) when the lessee has received a written termination notice for a certain date, surrenders the premises, and removes substantially all of its property from the premises; (ii) when the lessee surrenders possession of the premises in writing after having received a written termination notice for a certain date; or (iii) when the lessee abandons the premises, removes substantially all of its property, fails to conduct bingo for three consecutive occasions, and has not paid any rent for any period after those three occasion dates. (C) Upon receipt of a request by a lessor to place a lessee's license in inactive status, the Commission shall give notice to the lessee of its intent to do so. If, within 10 days after the mailing of that notice by certified mail return receipt requested the lessee has not requested a hearing on whether or not its license should be placed in inactive status, the Commission shall then place the license in inactive status. (D) Upon receiving a request from a lessee to place its license in inactive status, the Commission shall do so. (E) A lessee may contest the placing of its license in inactive status on the ground that it did not voluntarily surrender possession of the premises. (F) If a lessee requests a hearing, the Commission shall request that the case be set on the docket for hearing. (G) The placing of a license in inactive status does not preclude the taking of administrative action to revoke or suspend that license. (b) Commercial license to lease bingo premises. (1) (No change.) (2) Fee. An application for a license to lease bingo premises must be accompanied by a license fee which is based upon the annual gross rentals from licensed organizations. [For the purposes of this section "gross rentals from licensed organizations" means the total receipts, regardless of how they are denominated, from the licensed organizations, including, but not limited to, building rental, payments for utilities, fixtures, security services, etc.] The fee that must accompany the application must be made in accordance with the Bingo Enabling Act, Texas Civil Statutes, Article 179d, 13. (3) (No change.) (4) Bond or other security. Each application for an annual license to lease bingo premises must be accompanied by a bond or security equal to the applicant's estimated quarterly tax liability. No new bond will be required upon renewal if the licensee would be eligible to have an existing bond released under subparagraph (D) of this paragraph. If the bond amount is $99 or less, no bond will be required.
                        If a bond or other form of security is required, no license will be issued until such bond or other security has been posted. (A)-(B) (No change.) (C) Forfeiture. If a licensee pays less than the amount of bingo rental tax due under the Act, the Commission may
                          [will] notify both the licensee and any surety of the delinquency by jeopardy or deficiency determination. If payment is not made by the demand date stated in the notice, the Commission may
                            [will] forfeit the bond or security or any part of the bond or security necessary to pay the proper amount of tax. Failure to pay any delinquency when due is grounds for suspension or revocation of the licensed commercial lessor's right to lease bingo premises. (D)-(E) (No change.) (c) Temporary license to conduct bingo games. (1) Application. Any organization which desires to conduct bingo on a limited basis must apply to the Commission for a temporary license. The application must be made on a form prescribed by the Commission
                              [contain the same information and be made on the same form used by applicants for an annual license]. The complete application with required attachments should be filed with the Commission at least 30 days in advance of the first bingo game that will be played under the temporary license. (2)-(3) (No change.) (d)-(e) (No change.) (f) Payment of fees. The proper license fee must accompany each application. License fees will not be prorated. The fee accompanying an original application
                                [and any cash bond] must be in the form of cash, cashier's check, money order, or check made payable to the State Treasurer. After the filing of the application, fee, and any required bond, the Commission will promptly investigate the qualifications of the applicant and either: (1) -(3) (No change.) (g)-(k) (No change.) (l) Notification of changes. Each licensee has a continuing responsibility to promptly notify the Commission within 10 days
                                  in writing of any changes to information in a filed application, when information filed with the Commission becomes inaccurate in any way, or when additions or deletions are necessary to reflect changes in circumstances of the licensee. Examples of such changes include the name of the organizational officers, the amount of rent charged for leased premises, the name of a member responsible for the conduct of games or the name of an individual connected with a commercial lessor that would affect its eligibility to hold a license and, in the case of lessors, the name of a new, authorized organization that intends to lease premises from it for the purpose of conducting bingo. (m) Representation; personal receipt of documents. Only a designated operator or officer of a licensed organization or applicant for a license to conduct bingo or officer or designated business contact of a commercial lessor or applicant for a lessor's license may
                                    [For purposes of this subsection, an individual shall] be recognized by the Commission with respect to
                                      [as an applicant's or licensee's authorized representative only if the Commission has on file written authorization in the form of a resolution of the applicant's or licensee's governing body, that such individual has the authority to act on behalf of the applicant or licensee, and the extent of such authority. Written authorization furnished by an applicant or licensee under this rule shall apply only to the specific individuals listed in the authorization. Agents or employees of an authorized representative are not authorized representatives of the applicant or licensee unless specifically named in the written authorization on file with the Commission. Only the applicant, licensee, or those individuals specifically named in the applicant's or licensee's resolution as authorized representatives shall be recognized by the Commission concerning] any matter relating to the licensing process of that applicant or licensee
                                        or any corrective measures to be taken after an audit or field investigation of that applicant or licensee
                                          . [Only the applicant or its authorized representative may personally receive from the Commission documents relating to an applicant's license.] (n) Mailing address. The required mailing address of an organization applying for or holding a license to conduct bingo must be the primary business address of that applicant or licensee. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317910 Gayle Gordon General Counsel Texas Alcoholic Beverage Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 206-3204 16 TAC sec.55.546 The Texas Alcoholic Beverage Commission proposes an amendment to sec.55. 546, concerning exemptions from licensing requirements. The amendment adds a new subsection (c) specifying what information and documents an entity applying for exemption from licensing must provide to the commission. Thomas L. Byrd, director of auditing and tax reporting, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Byrd also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be a clearer understanding of the information and documentation necessary to receive an exemption from licensing under the Bingo Enabling Act. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Jeanne Fox, Director, Bingo Division, P.O. Box 13127, Austin, Texas 78711, (512) 206-3276. The amendment is proposed under Texas Civil Statutes, Article 179d, Bingo Enabling Act, sec.16(a), which authorize the Commission to adopt rules relating to the enforcement and administration of the Bingo Enabling Act. sec.55.546. Exemptions from Licensing Requirements. (a)-(b) (No change.) (c) Any organization requesting exemption must state in its letter that the games are for prizes of $10 or less and that the games will be limited to members of the senior citizens' association, patients in the hospital or nursing home, or residents of the retirement home. A senior citizens' association shall also send with its letter a copy of its organizing instrument, a list of its officers, and a list of its members showing their ages. A retirement home shall send with its letter a copy of a brochure or a certificate from a state agency showing that it is a retirement home. A nursing home shall send with its letter a copy of its certificate to operate a nursing home from the Texas Department of Health. A hospital shall send with its letter proof that it is a hospital. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317911 Gayle Gordon General Counsel Texas Alcoholic Beverage Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 206-3204 16 TAC sec.55.547 The Texas Alcoholic Beverage Commission proposes an amendment to sec.55. 547, concerning books and records-bingo licensees. The amendment amends subsection (a) to require an officer or operator to be on a licensed authorized organization's signature card and sign its checks, to require the keeping of a Daily Floor Sales Summary, to clarify how records of different price sales must be kept, to require written permission of the Commission for any different method of recording sales, to require more detailed information on payroll checks and lease payment checks, and to require monthly inventories of bingo supplies. The amendment amends subsection (d) to require notification of inability to make a timely loan payment, to provide for restructuring of the loan repayment schedule, to prohibit approving loans to meet the minimum charitable distribution requirement, and to change how loan proceeds and loan payments are reported. The amendment amends subsection (e)(3) to include rental receipts of a lessor also licensed to conduct bingo in computing the minimum charitable distribution of that organization. The amendment also adds new subsections (g) and (h) to provide for the removal of records during an audit or investigation and to adopt sample record-keeping forms. Thomas L. Byrd, director of auditing and tax reporting, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the sections. Mr. Byrd also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be more funds available for charitable contributions as a result of better internal control of operations. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Jeannene Fox, Director, Bingo Division, P.O. Box 13127, Austin, Texas 78711, (512) 206-3276. The amendment is proposed under Texas Civil Statutes, Article 179d, Bingo Enabling Act, sec.16(a), which authorize the Commission to adopt rules relating to the enforcement and administration of the Bingo Enabling Act. sec.55.547. Books and Records-Bingo Licensees. (a) This rule sets minimum standards for recordkeeping for licensees that conduct bingo or, where specified, that lease bingo premises. Where the Texas Alcoholic Beverage Commission (Commission) provides forms for recordkeeping, licensees may use those forms or forms of their own choosing which contain the same information, except as otherwise provided in paragraph (l)(D) of this subsection. (1) Cash receipt records. The records required to document cash receipts consist of the following. (A) (No change.) (B) Bingo bank account. A licensed authorized organization must establish and maintain one regular checking account designated the bingo account and may also maintain an interest-bearing savings account designated the bingo savings account, as provided in the Bingo Enabling Act, Texas Civil Statutes, Article 179d, s19a(a). A licensed organization may have on its bingo account's signature card only active members of the organization except that one bookkeeper or accountant who is not a member may be on the signature card. At least one officer or operator
                                            [active member] of the licensed organization must be on the signature card. An operator or officer of the organization must also sign all checks.
                                              A licensed organization must keep validated deposit slips. Any interest income earned from the bingo savings account must be accounted for as part of the net proceeds available for charitable distribution. Prize fees collected at a bingo occasion shall be deposited in the bingo checking account with the proceeds from that occasion. (C) (No change.) (D) Documenting daily receipts. A licensed organization shall substantiate the contents of these cash receipt records by use of a Disposable Card Sales Summary on a form prescribed by the Commission, a Daily Floor Sales By Usher
                                                and the use of a cash register. In using a cash register, the following directions apply. (i) (No change.) (ii) Each different sales price for hard cards, disposable paper cards, and instant bingo cards
                                                  [Various types of sales] must [each] be recorded on
                                                    [with] a separate key. Income from various types of sales must be separately recorded and the cash register must be able to provide a total for each type of sale recorded. The total of floor sales for each type of sale must be recorded at the conclusion of the organization's sales for the occasion. (iii) (No change.) (iv) Any method of recording sales different from that specified in clause (ii) of this subparagraph is in violation of this section unless written permission has been obtained from the commission for that alternate method of recording sales. (2) Cash disbursement records. The records to document cash disbursements consist of the following: (A) Bingo bank account. Funds from the bingo account must be withdrawn by checks or withdrawal slips as provided in the Bingo Enabling Act, Texas Civil Statutes, Article 179d, s19a(b). Checks written for lease payments must also show the periods for which payments are made and payments for payroll must also show the worker's function and the periods for which payments are made. (B)-(D) (No change.) (3) Inventory Records. Each licensed authorized organization must take an inventory of its bingo supplies at the end of each month, reflecting the following information: (A) the date of the inventory; (B) the full description and quantity of each type of ups pad, by series number; (C) the full description and quantity of each type of single sheets by series number; and (D) the full description and quantity of each type of instant bingo cards by series number; (E) the balance of inventory per the Disposable Card Sales summaries for each type of ups pad and single sheet; (F) the difference between the balance per the Disposable Card Sales Summary and actual count of cards on hand for each series of ups pads and single sheets. (4) The inventory of bingo supplies required by paragraph (3) of this subsection must be signed by person conducting the inventory and kept at the licensed location or at a location authorized in writing by the commission. (b)-(c) (No change.) (d) Loans to the bingo account. (1) A licensed authorized organization or an organization applying for a license to conduct bingo may loan money to its bingo account from its general fund if: (A)-(B) (No change.) (C) If an organization is unable to make a loan payment pursuant to its repayment schedule, it shall, prior to the renewal of its license, notify the commission to determine whether the loan repayment schedule should be restructured. At the commission's discretion, the loan repayment schedule may be amended once to extend it for a period not to exceed 12 months. (D) The commission may not approve loans to meet the 35% minimum charitable distribution requirement under Texas Civil Statutes, Article 179d, Bingo Enabling Act, sec.l9a(k). (2) (No change.) (3) The loan transaction must be reported on the quarterly reports as follows: (A) loan proceeds must be reported as approved loan proceeds
                                                      [interest earned] for the quarter in which they are received; and (B) loan payments must be reported as repayment of approved loans
                                                        [expenses] for the quarter in which they are paid. (4)-(5) (No change. ) (e) Commercial lessors licensed to conduct bingo. (1)-(2) (No change.) (3) Rental payments required by this subsection to be deposited in the bingo bank account are not part of gross receipts for purposes of the bingo gross receipts tax. Such rental payments are [not] considered in computing adjusted gross receipts under sec.55.555 of this title (relating to Minimum Charitable Distribution). Distributions for charitable purposes of such funds from the bingo checking account will be considered as part of the disbursements toward meeting that minimum charitable distribution requirement under sec.55.555 of this title. (f) (No change.) (g) Records kept. The Commission, with the consent of an operator or officer of a licensed authorized organization or of an owner, operator, officer, or business contact of a licensed commercial lessor may remove any records kept pursuant to this section or sec.55.554, concerning instant bingo, for audit purposes or for the purposes of any investigation. (h) Sample forms. As provided in subsection (a) if this section, the commission adopts the following sample forms. [graphic] This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317912 Gayle Gordon General Counsel Texas Alcoholic Beverage Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 206-3204 16 TAC sec.55.548 The Texas Alcoholic Beverage Commission proposes an amendment to sec.55. 548, concerning general restrictions on the conduct of bingo. The amendment substantially amends subsection (a) to restrict or prohibit involvement by lessors, their agents or employees, and first degree relations of those persons in the conduct of bingo, to state examples of what will be considered prohibited involvement, and to specify when delinquency in rent will and will not be considered prohibited involvement. The amendment also amends subsection (b) to clarify that an organization leasing from a commercial lessor must be leasing from a separate entity with a lessor's license and to allow two affiliated organizations to conduct bingo at premises that they jointly own. The amendment also amends subsection (d) to prohibit advertising of out-of-state bingo games and to require that advertisements must contain the name of the licensed authorized organization as it appears on its license but need not include its license number. The amendment also amends subsection (k) and (l) to allow the commission to require the repair or replacement of any defective bingo equipment and to clarify at what location a winning card must be verified by other players. Thomas L. Byrd, director of auditing and tax reporting, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Byrd also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be increased compliance with the Bingo Enabling Act and Rules resulting from clarification of what constitutes illegal involvement and of various other requirements regarding the conduct of bingo. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Jeannene Fox, Director, Bingo Division, P.O. Box 13127, Austin, Texas 78711, (512) 206-3276. The amendment is proposed under Texas Civil Statutes, Article 179d, Bingo Enabling Act, 16(a), which authorize the Commission to adopt rules relating to the enforcement and administration of the Bingo Enabling Act. sec.55.548. General Restrictions on the Conduct of Bingo. (a) Who may conduct bingo. (1) (No change.) (2) All callers, cashiers, ushers, bookkeepers, and accountants who assist in conducting, promoting, or administering bingo games must be members of the authorized organization or hired by and acting under the supervision of the authorized organization. [(A) Except as provided hereafter, neither a commercial lessor nor any person having an interest in a commercial lessor, nor any employee or agent of any of them shall operate, manage, conduct, advise, or assist in the operating, managing, conducting, promoting, or administering of bingo. The term "assist" as used in this rule includes, but is not limited to, the payment of any expense of a licensed bingo organization by a commercial lessor, whether such payment be by loan or otherwise. This prohibition does not apply to a person whose employment by or business relationship with a commercial lessor is unrelated to the leasing of bingo premises and who is not acting in the capacity of operator. [(B) A commercial lessor which is an organization licensed to conduct bingo and which leases premises it owns or occupies to another authorized organization may assist in the conduct of bingo games by that organization except that a member, employee, or agent of the lessor may not act as an operator for the lessee organization. [(C) A commercial lessor who has been an active bona fide member of the licensed organization for at least three years actively engaged in carrying out the purposes of the organization may assist that organization in the conduct of bingo at the lessor's premises but may not receive compensation for so assisting and may not act in the capacity of operator.] (3) Neither a commercial lessor or any person having an interest in a commercial lessor, nor any employee or agent of a commercial lessor, nor any person related in the first degree by consanguinity or affinity to any such person may directly or indirectly operate, manage, conduct, advise, or assist in the operating, managing, conducting, promoting, or administering of bingo. This prohibition includes, but is not limited to, the following actions: (A) hiring or firing bingo workers or bookkeepers; (B) suggesting which workers, bookkeepers, janitorial services, or security services should be hired or fired; (C) suggesting game schedules and/or prize amounts; (D) paying, either directly or through a loan, any expense of a licensed authorized organization or applicant for a license to conduct bingo including advertising, purchase of bingo equipment, license fees or taxes, payment of bingo workers or bookkeepers, or any other expense related to the conducting of bingo; (E) having access to or control of any bank account held by the licensed authorized organization; and (F) requiring the use of any particular distributor, supplier, or service provider by the licensed authorized organization. (4) If a commercial lessor is an organization whose sole purpose is to hold title to real property used by a particular licensed authorized organization, such as a Columbus Club owning property used by a chapter of the Knights of Columbus, a member of the lessor organization who has been an active bona fide member of the particular licensed authorized organization for at least three years actively engaged in carrying out the purposes of the organization may assist that organization in the conduct of bingo at the lessor's premises but may not receive compensation for so assisting. (5) A commercial lessor, which is also an organization licensed to conduct bingo and which leases the premises it owns or occupies to another licensed authorized organization, may assist in the conduct of bingo games by that organization except that a member, employee, or agent of the lessor may not act as an operator for the lessee organization. (b) Location. Bingo may be conducted by a licensed organization only on premises, as that term is defined in Rule sec.55.544 of this title (relating to Definitions), which are: (1) (No change.) (2) owned jointly in equal 50% shares by the licensed organization and another authorized organization with which it is affiliated and at which no organization other than those two affiliated organizations conducts bingo; (3)
                                                          [(2)] owned by a governmental agency; (4)
                                                            [(3)] leased, or used only by the holder of a temporary license; or (5)
                                                              [(4) owned or] leased by the licensed organization from a separate entity which is
                                                                [by] a licensed commercial lessor. (c) Limit on rent. The payment of rent shall be limited as follows, subject to the exceptions specified in the Bingo Enabling Act, sec.11a(c). (1)-(2) (No change.) (3) All lease payments made by the licensed authorized organization must be paid on a monthly, weekly, or per occasion basis, and the lease must so specify, unless otherwise authorized in writing by the Commission. (4) The fact that a licensed authorized organization is delinquent in its rent is not considered lessor involvement if either of the following two conditions are met: (A) the delinquent rent does not exceed an amount equivalent to the rent due for all occasions during a three-month period; or (B) within 15 days of the date on which the delinquent rent exceeds the amount specified in subparagraph (A) of this paragraph either: (i) the commercial lessor forgives the rent by a written release signed by the lessor and an operator or officer of the lessee organization; or (ii) the commercial lessor and the lessee organization renegotiate the lease for a lesser amount by a lease amendment approved by the commission, both as to the form of the amendment and to the reduction in rent being a bona fide attempt to solve the rental problem. (d) Advertising. All advertisements for bingo games, whether in newspapers, fliers, pamphlets, brochures, or other circulars, billboards, signs, or recordings, must clearly identify the name of the licensed authorized organization exactly as it appears on its license
                                                                  [its bingo license number], and the days and times of the occasions it will operate. Only a licensed authorized organization may advertise or promote bingo. The advertisement of out-of-state bingo games in separate fliers, brochures, or posters is prohibited except as specifically allowed by Indian tribal games by Federal law. A licensed authorized organization may not allow any such advertisement for out-of-state games, including those for tribal games to be distributed at a licensed location.
                                                                    No licensed authorized organization may include in any advertisement or promotion the amount of a prize or prizes offered at a bingo occasion. A reference to the prize limits allowed by the Bingo Enabling Act, so long as no specific amount is mentioned, is allowed. (e)-(j) (No change.) (k) Inspection of equipment, tampering prohibited. All bingo equipment, including blowers, flashboards, balls, and bingo cards, are subject to inspection at any time by any representative of the Commission and the Commission may require the repair or replacement of any equipment which is not in proper working order.
                                                                      An authorized organization conducting bingo shall replace the bingo balls in use with a complete new set at least each six months or after each 50 occasions, whichever occurs later, and shall replace the balls at any time upon order of the Commission or its representative. No person may tamper with or modify any bingo equipment in any manner which would affect the randomness of numbers chosen or which changes the numbers or symbols appearing on the face of a bingo card. A licensed authorized organization has a continuing responsibility to ensure that all bingo equipment used by it is in proper working condition. (l) Verification. (1) Verification of winning cards. The numbers appearing on the winning card must be verified at the time the winner is determined and prior to prize(s) being awarded in order to insure that the numbers on the card in fact have been drawn from the receptacle. This verification shall be done in the immediate presence of one or more players at a table [or location] other than the winner's. Each winning disposable paper card shall be displayed on any television monitors in use. Each winning disposable paper card shall also be posted on the licensed premises where it may be viewed in detail by the players until at least 30 minutes after the completion of the last bingo game of that organization's occasion. (2) (No change.) This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317913 Gayle Gordon General Counsel Texas Alcoholic Beverage Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 206-3204 16 TAC sec.55.549 The Texas Alcoholic Beverage Commission proposes an amendment to sec.55. 549, concerning allowable expenditures of receipts for bingo. The amendment amends subsection (e) and adds a new subsection (g) to require that any disallowed expenditures must be replaced by funds unrelated to bingo proceeds and to allow the commission to disallow expenditures which are unreasonable in price or in the number of persons employed. Thomas J. Byrd, director of auditing and tax reporting, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Byrd also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be increased funds available for charitable purposes resulting from clarification of the source of funds to be used to replace monies utilized for improper expenses. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Jeannene Fox, Director, Bingo Division, P.O. Box 13127, Austin, Texas 78711, (512) 206-3276. The amendment is proposed under Texas Civil Statutes, Article 179d, Bingo Enabling Act, sec.16(a), which authorize the Commission to adopt rules relating to the enforcement and administration of the Bingo Enabling Act. sec.55.549. Allowable Expenditures of Receipts from Bingo. (a) -(b) (No change.) (c) If the Commission disallows all or any portion of an expense or charitable distribution shown on a licensee's quarterly report, the licensee must immediately transfer from other funds not related to bingo proceeds
                                                                        an amount into its bingo account equal to the amount of disallowed expense or charitable distribution. (d)-(f) (No change.) (g) The commission may disallow, in whole or in part, any expense claimed by a licensed authorized organization if the commission determines that the expense is excessive relative to comparative market value or is for the employment of an unreasonable number of persons in a particular capacity. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317914 Gayle Gordon General Counsel Texas Alcoholic Beverage Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 206-3204 16 TAC sec.55.552 The Texas Alcoholic Beverage Commission proposes an amendment to sec.55. 552, concerning licenses, fees, and bonds for manufacturers and distributors. The amendment amends subsection (c) to authorize investigation fees for investigation of original or additional facilities of licensees as well as of applicants for a license. Thomas L. Byrd, director of auditing and tax reporting, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Byrd also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be a clearer understanding of who is required to pay investigative fees regarding investigations of facilities of licensees or applicants. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Jeannene Fox, Director, Bingo Division, P.O. Box 13127, Austin, Texas 78711, (512) 206-3276. The amendment is proposed under Texas Civil Statutes, Article 179d, Bingo Enabling Act, sec.16(a), which authorize the Commission to adopt rules relating to the enforcement and administration of the Bingo Enabling Act. sec.55.552. Licenses, Fees, and Bonds for Manufacturers and Distributors. (a)-(b) (No change.) (c) Investigation fee. The Commission may require an applicant or licensee
                                                                          to pay an additional fee in an amount equal to the cost of a background investigation, including the inspection of applicant's or licensee's
                                                                            plants and other facilities. If the Commission intends to impose the investigation fee, it will notify the applicant or licensee
                                                                              in writing prior to starting the investigation that the fee will abe imposed and will supply an estimate of the amount of the fee. If the applicant or licensee
                                                                                does not wish to pay the investigation fee, it may withdraw the application or notification of additional plants or other facilities
                                                                                  and the basic fee will be refunded. The persons making the inspection shall submit travel vouchers and supporting documents to the Commission and shall receive reimbursement or a travel advance from the Commission in the same manner as for other state travel, as provided in the State Employees Travel Allowance Guide, as most recently revised and issued by the Comptroller. The Commission shall send to the applicant or licensee
                                                                                    copies of the vouchers and supporting documents together with a statement for the fee, in the same amount as was paid by the Commission on account of the inspection. The applicant or licensee
                                                                                      shall reimburse the Commission, within 30 days of the date of the statement for the amount shown in the statement. (d)-(f) (No change.) This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317915 Gayle Gordon General Counsel Texas Alcoholic Beverage Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 206-3204 16 TAC sec.55.553 The Texas Alcoholic Beverage Commission proposes an amendment to sec.55. 553, concerning books and records-distributors and manufacturers. The amendment adds a new subsection (a)(l)(B)(ix) requiring that invoices include the serial numbers of disposable paper cards sold, changes the form adopted by present subsection (d) accordingly, adds new subsections (c) and (d) requiring the labeling of boxes of supplies to show the names of the purchasing licensed organization and the serial numbers of disposable paper cards, and reletters the present subsections (c) and (d). Thomas L. Byrd, director of auditing and tax reporting, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Byrd also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be increased funds for charitable purposes resulting from better control of licensees' inventories. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Jeannene Fox, Director, Bingo Division, P.O. Box 13127, Austin, Texas 78711. The telephone number is (512) 206-3276. The amendment is proposed under Texas Civil Statutes, Article 179d, Bingo Enabling Act, sec.16(a), which authorize the Commission to adopt rules relating to the enforcement and administration of the Bingo Enabling Act. sec.55.553. Books and Records-Distributors and Manufacturers. (a) Every licensed distributor and manufacturer must maintain a complete set of records including, but not limited to, the following. (1) Sales invoices. (A) (No change.) (B) Each licensee must use a general sales invoice which sets out the following information: (i)-(viii) (No change.) (ix) the serial numbers of disposable paper cards sold. The requirement to include serial numbers on the sales invoice becomes effective 90 days after the effective date of the amendment to this section. (2)-(5) (No change.) (b) (No change.) (c) A licensee who holds a distributor's license must attach the name of the licensed authorized organization on the outside of each box containing bingo supplies sold to that licensed authorized organization. (d) A licensee who holds a manufacturer's license must show the serial numbers of disposable paper cards sold on the outside of sealed boxes. A distributor who repackages disposable paper cards shall show the serial numbers of the disposable paper cards on the outside of sealed boxes. The requirement to show serial numbers on the outside of sealed boxes becomes effective 90 days after the effective date of the amendment to this section. (e)
                                                                                        [(c)] Records required by this rule must be maintained for at least four years. (f)
                                                                                          [(d)] The Commission adopts the following sample general sales invoice. [graphic] This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317916 Gayle Gordon General Counsel Texas Alcoholic Beverage Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 206-3204 16 TAC sec.55.554. The Texas Alcoholic Beverage Commission proposes an amendment to sec.55. 554, concerning instant bingo. The amendment amends subsection (d) by amending paragraph (3)(A) to clarify when instant bingo cards may be sold, by amending paragraph (6) to clarify the prohibition against commingling deals of instant bingo cards, and by adding paragraph (8) providing that unsold cards must be kept by the licensed organization or destroyed by the commission to verify that the cards have not been sold. The amendment also amends subsection (g) by amending paragraph (1) to include the date cards are sold, adding a new paragraph (5) and renumbering the present paragraph (5), and to require manufacturers and distributors to maintain complete records of all transactions concerning instant bingo cards approved for sale in Texas and to furnish to the commission on request records concerning distribution of those cards outside of Texas. Thomas L. Byrd, director of auditing and tax reporting, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Byrd also has determined that for each of the first five years the section is in effect, the public benefit anticipated as a result of enforcing the section will be increase compliance resulting from clarification of requirement concerning unsold bingo cards and from closer control over instant bingo cards brought into the state through improper channels. There will be not effect on small businesses. There is not anticipated economic cost to persons required to comply with the section as proposed. Comments on the proposal may be submitted to Jeannene Fox, Director, Bingo Division, P.O. Box 13127, Austin, Texas 78711, (512) 206-3276. The amendment is proposed under Texas Civil Statutes, Article 179d, Bingo Enabling Act, sec.16(a), which authorize the Commission to adopt rules relating to the enforcement and administration of the Bingo Enabling Act. sec.55.554. Instant Bingo. (a)-(c) (No change.) (d) Prizes, costs, sales, percentages. (1)-(2) (No change.) (3) All sales of instant bingo cards must be performed under the same conditions and in the same manner as sales of regular and paper special bingo cards. Thus, a licensed organization may sell instant bingo cards on the premises specified in its license and where regular or paper special bingo cards are sold prior to its licensed times. They may be redeemed for cash or other cards only: (A) during the times that that organization
                                                                                            bingo cards are being sold; (B)-C) (No change.) (4)-(5) (No change.) (6) A licensed organization may not commingle different deals of instant bingo cards being sold. Instant bingo cards may not be commingled between licensed organizations and cards removed from one deal may not be commingled with cards removed from sale from another deal. (7) (No change.) (8) Incomplete deals that have been removed from sale must be kept by the licensed organization for a period of four years or be destroyed by the Commission in order to verify sale of less than the complete deal. (e)-(f) (No change.) (g) Records. (1)-(4) (No change.) (5) A manufacturer or distributor shall make and maintain complete records of all of its transactions relating to any series of instant bingo cards which have been approved for use in Texas and upon request by the commission, shall furnish to the commission those records relating to the distribution of those series outside of Texas. (6)
                                                                                              [(5)] These records must be retained for a period of four years. (h) (No change.) This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317917 Gayle Gordon General Counsel Texas Alcoholic Beverage Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 206-3204 16 TAC sec.55.558 The Texas Alcoholic Beverage Commission proposes an amendment to sec.55. 558, concerning seal required on disposable bingo cards. The amendment adds a new subsection (e) and reletters the present subsections (e) and (f). The new subsection requires manufacturers and distributors to maintain records of all transactions relating to disposable cards approved for use in Texas and to furnish to the commission on request any records relating to the distribution of those cards outside of Texas. Thomas L. Byrd, director of auditing and tax reporting, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Byrd also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be increased compliance resulting from stricter control over disposable bingo cards brought in to the state illegally. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Jeannene Fox, Director, Bingo Division, P.O. Box 13127, Austin, Texas 78711, (512) 206-3276. The amendment is proposed under Texas Civil Statutes, Article 179d, Bingo Enabling Act, sec.16(a), which authorize the Commission to adopt rules relating to the enforcement and administration of the Bingo Enabling Act. sec.55.558. Seal Required on Disposable Bingo Cards. (a)-(d) (No change.) (e) A manufacturer or distributor shall make and maintain complete records of all of its transactions relating to disposable bingo cards which have been approved for use in Texas under this section and upon request by the commission, shall furnish to the commission those records relating to the distribution outside of Texas of those approved cards. (f)
                                                                                                [(e)] In addition to the restrictions contained in the Bingo Enabling Act, sec.11(n)-(u) and sec.13c(i), the following restrictions apply to the sale or purchase of disposable cards. (1) A manufacturer shall not sell or otherwise furnish unapproved disposable cards to distributors for use in this state. This requirement shall also apply to any manufacturer who assembles and collates disposable cards for sale in Texas even though such cards have been previously submitted for approval by the original manufacturer. In addition, any licensed manufacturer who collates another manufacturer's disposable cards for sale in Texas must purchase all card sheets to be used in collating such cards from a licensed manufacturer. (2) A distributor shall not purchase or otherwise obtain unapproved disposable cards for use in this state. (3) A licensed organization shall not purchase or otherwise obtain unapproved disposable cards for use in this state. A licensed organization shall not use in this state unapproved disposable cards. (g)
                                                                                                  [(f) ] The requirements that all cards have printed on the face of the card the seal of the Texas Alcoholic Beverage Commission and the name of the manufacturer, a trade name, or a trademark shall be implemented according to the following schedule. (1) A manufacturer shall not sell or otherwise furnish disposable cards not bearing the seal of the Texas Alcoholic Beverage Commission and the manufacturer's name, trade name, or trademark, to distributors for use in this state after December 31, 1989. This requirement also applies to any manufacturer who assembles and collates disposable cards for sale in Texas, but only the name, trade name, or trademark of the original manufacturer who printed the card face shall be printed on the card face. (2) A distributor shall not purchase disposable cards which do not bear the seal of the Texas Alcoholic Beverage Commission and the name, trade name, or trademark of the manufacturer after December 31, 1989, for use in this state. A distributor may continue to sell cards which bear the Comptroller's seal and do or do not bear the manufacturer's name, trade name, or trademark, to licensed organizations in this state until March 31, 1990. (3) A licensed organization shall not purchase or otherwise obtain unapproved disposable cards which do not bear the seal of the Texas Alcoholic Beverage Commission and the manufacturer's name, trade name, or trademark for use in this state after March 31, 1990. A licensed organization shall not use in this state disposable cards which do not bear the seal of the Texas Alcoholic Beverage Commission and the manufacturer's name after June 30, 1990. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317918 Gayle Gordon General Counsel Texas Alcoholic Beverage Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 206-3204 16 TAC sec.55.561 The Texas Alcoholic Beverage Commission proposes an amendment to sec.55. 561, concerning interview requirements. The amendment designates the present rule as subsection (a) and authorizes the commission to determine who may be present at an interview. The amendment also adds a new subsection (b) providing for a conference relating to corrective measures after an audit or field investigation and authorizing the commission to compel attendance by designated persons. Thomas L. Byrd, director of auditing and tax reporting, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Byrd also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be increased compliance resulting from a closer involvement of all levels of management in the various aspects of the bingo licensing and audit process. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Jeannene Fox, Director, Bingo Division, P.O. Box 13127, Austin, Texas 78711, (512) 206-3276. The amendment is proposed under Texas Civil Statutes, Article 179d, Bingo Enabling Act, sec.16(a), which authorize the Commission to adopt rules relating to the enforcement and administration of the Bingo Enabling Act. sec.55.561. Interview 23>and Conference Requirements. (a) Interview. Each applicant for a bingo license or the renewal of an existing license, whether as a conducting organization, lessor, manufacturer, or distributor may be required to be interviewed by a representative of the Texas Alcoholic Beverage Commission (Commission). The Commission may specify the persons required or permitted
                                                                                                    to be present and the time and location of the interview. The interview will ensure the applicant's awareness and understanding of requirements of the Bingo Enabling Act and the Rules and Regulations promulgated thereunder. The applicant will assure the Commission that all operations by the applicant relating to bingo will be conducted according to the Act and the Rules and Regulations promulgated thereunder. The Commission may refuse to issue or renew an annual license based on the conclusions resulting from the interview. (b) Conference. The Commission may require that a designated operator and/or officer of a licensee be in attendance at any conference relating to corrective measures to be taken after an audit or field investigation. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317919 Gayle Gordon General Counsel Texas Alcoholic Beverage Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 206-3204 16 TAC sec.55.562 The Texas Alcoholic Beverage Commission proposes an amendment to sec.55. 562, concerning unauthorized prizes. The amendment adds a new subsection (d) allowing licensed authorized organizations to give away food and beverage items of a certain value to all persons attending a bingo occasion. Thomas L. Byrd, director of auditing and tax reporting, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Byrd also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be increased funds for charitable purposes resulting from low cost promotions utilized to attract patrons. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Jeannene Fox, Director, Bingo Division, P.O. Box 13127, Austin, Texas 78711, (512) 206-3276. The amendment is proposed under Texas Civil Statutes, Article 179d, Bingo Enabling Act, sec.16(a), which authorize the Commission to adopt rules relating to the enforcement and administration of the Bingo Enabling Act. sec.55.562. Unauthorized Prizes. (a)-(c) (No change.) (d) Organization's expenditures. Subsection (c) of this section does not prohibit a licensed authorized organization for offering, free of charge, food and beverage items to all persons in attendance at a bingo occasion. An organization's expenditures for these items must not exceed an amount equal to $1.50 per person in attendance and are an allowable promotional expense of the organization. A commercial lessor which is not licensed to conduct bingo, may not pay any part of that expense. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317920 Gayle Gordon General Counsel Texas Alcoholic Beverage Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 206-3204 16 TAC sec.55.565 The Texas Alcoholic Beverage Commission proposes new sec.55.565, concerning partial pay agreement. The section specifies the conditions under which a partial pay agreement to pay tax liability in installments may be agreed to and specifies requirements which must be met by a licensed authorized organization after an agreement has been entered into. Thomas L. Byrd, director of auditing and tax reporting, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Mr. Byrd also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be to specify when a partial payment agreement may be used and what the requirements of that agreement may be. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted to Jeannene Fox, Director, Bingo Division, P.O. Box 13127, Austin, Texas 78711, (512) 206-3276. The new section is proposed under Texas Civil Statutes, Article 179d, Bingo Enabling Act, sec.16(a), which authorize the Commission to adopt rules relating to the enforcement and administration of the Bingo Enabling Act. sec.55.565. Partial Pay Agreement. (a) A partial pay agreement is a contract between a licensed authorized organization and the Texas Alcoholic Beverage Commission which allows the organization to pay in installments the full amount of bingo gross receipts tax liability, penalty, and interest. (b) The Commission may enter into a partial pay agreement with an organization only if the following requirements are met: (1) the organization is unable to pay the liability in one lump sum from its bingo account and its general fund; (2) the organization furnishes letters from at least two financial institutions refusing to loan the organization the full amount of the liability, one of which letters must be from the bank where the organization maintains bingo accounts; (3) the organization's bingo receipts and expenses, including current taxes, and required charitable distribution indicate that the organization will be able to pay the tax liability within a time period of not more than 24 months; (4) the organization has posted or posts an adequate bond; and (5) the organization makes a down payment of at least 25% of the liability covered by the agreement, unless a lesser amount is approved by the Commission. (c) After the partial pay agreement has been entered into, the organization must meet the following requirements: (1) the organization must remain current in its payment of all taxes coming due after the execution of the agreement, and failure of the organization to do so is grounds for cancellation of the agreement; (2) the organization may not amend the agreement to add additional liabilities; and (3) the organization may not enter into more than one partial pay agreement until the provisions of the first partial pay agreement have been fulfilled. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317921 Gayle Gordon General Counsel Texas Alcoholic Beverage Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 206-3204 Part VIII. Texas Racing Commission Chapter 301. Definitions 16 TAC sec.301.1 The Texas Racing Commission proposes an amendment to sec.301.1, concerning definitions. The amendment adds a definition for reasonable belief. Paula Cochran Carter, general counsel for the Texas Racing Commission, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Ms. Carter also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be the assurance that the rules of the commission are consistent with state law and are easily understood by its licensees. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted on or before March 1, 1993, to Paula Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711. The new section is proposed under Texas Civil Statutes, Article 179e, sec.3. 02, which authorize the commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act. sec.301.1. Definitions. The following words and terms, when used in this part, shall have the following meanings, unless the context clearly indicates otherwise. Reasonable belief -A belief that would be held by an ordinary and prudent person in the same circumstances as the actor. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 15, 1993. TRD-9318095 Paula Cochran Carter General Counsel Texas Racing Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 794-8461 Chapter 311. Conduct and Duties of Individual Licensees Subchapter C. Alcohol and Drug Testing Drugs 16 TAC sec.311.201 The Texas Racing Commission proposes an amendment to sec.311.201, concerning use prohibited. The amendment prohibits a licensee from having a dangerous drug or controlled substance in his or her system while on the grounds of a pari- mutuel racetrack. Paula Cochran Carter, general counsel for the Texas Racing Commission, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Ms. Carter also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be the assurance that pari-mutuel racing is safe for the licensees and is conducted with utmost integrity. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted on or before March 1, 1993, to Paula Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711. The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, which authorize the commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act, and sec.14.03, which authorizes the commission to adopt rules prohibiting the illegal influence of a race. sec.311.201. Possession and Use Prohibited. (a) Except as otherwise provided by this section, an individual licensee may not, while performing duties required of the licensee, have present in his or her system
                                                                                                      [be under the influence of] a dangerous drug as defined by the Health and Safety Code, Chapter 483
                                                                                                        [Texas Dangerous Drugs Act, Texas Civil Statutes, Article 4476-14], or a controlled substance as defined by the Texas Controlled Substances Act, Health and Safety Code, Chapter 481
                                                                                                          [Texas Civil Statutes, Article 4476-15]. (b) Except as otherwise provided by this section, an individual licensee may not possess, while on association grounds, a dangerous drug as defined by the Health and Safety Code, Chapter 483
                                                                                                            [Texas Dangerous Drugs Act, Texas Civil Statutes, Article 4476-14], or a controlled substance as defined by the Texas Controlled Substances Act, Health and Safety Code, Chapter 481
                                                                                                              [Texas Civil Statutes, Article 4476-15]. This subsection does not apply to a veterinarian licensed by the commission who has obtained permission to possess a controlled substance or dangerous drug under sec.319.14 of this title (relating to Possession of Controlled Substances). (c) (No change.) This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 15, 1993. TRD-9318094 Paula Cochran Carter General Counsel Texas Racing Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 794-8461 16 TAC sec.311.202 The Texas Racing Commission proposes an amendment to sec.311.202, concerning subject to testing. The amendment establishes the penalty for a licensee's refusal to submit to a drug test. Paula Cochran Carter, general counsel for the Texas Racing Commission, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Ms. Carter also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be the assurance that pari-mutuel racing is safe for the licenses and is conducted with utmost integrity. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted on or before March 1, 1993, to Paula Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711. The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, which authorize the commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act, and sec.14.03, which authorizes the commission to adopt rules prohibiting the illegal influence of a race. sec.311.202. Subject to Testing. (a) (No change.) (b) A licensee who fails to submit to such a test when requested to do so by the stewards or racing judges shall be suspended for at least 30 days and referred to the commission
                                                                                                                [is subject to discipline by the stewards or racing judges or the commission]. A licensee who fails to submit to a test for the second time shall be suspended by the stewards or racing judges for at least six months and referred to the commission. A licensee who fails to submit to a test for a third or subsequent time shall be suspended by the stewards or racing judges for one year and referred to the commission. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 15, 1993. TRD-9318093 Paula Cochran Carter General Counsel Texas Racing Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 794-8461 16 TAC sec.311.203 The Texas Racing Commission proposes an amendment to sec.311.203, concerning method of selection. The amendment clarifies the method of selection for drug testing. Paula Cochran Carter, general counsel, for the Texas Racing Commission, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Ms. Carter also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be the assurance that pari-mutuel racing is safe for the licensees and is conducted with utmost integrity. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted on or before March 1, 1993, to Paula Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711. The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, which authorize the commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act, and sec.14.03, which authorizes the commission to adopt rules prohibiting the illegal influence of a race. sec.311.203. Method of Selection. (a) (No change.) (b) An individual licensee may be selected for testing at any time while on association grounds on the basis of reasonable belief
                                                                                                                  [cause] . [The commission shall prescribe criteria on which the stewards and racing judges may base a selection for reasonable cause.] This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 15, 1993. TRD-9318092 Paula Cochran Carter General Counsel Texas Racing Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 794-8461 16 TAC sec.311.206 The Texas Racing Commission proposes an amendment to sec.311.206, concerning medical review officer. The amendment clarifies the procedure for evaluating drug test results, including the duties and requirements for the selection of the medical review officer. Paula Cochran Carter, general counsel for the Texas Racing Commission, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing the section. Ms. Carter also has determined that for each of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be the assurance that pari-mutuel racing is safe for the licensees and is conducted with utmost integrity. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted on or before March 1, 1993, to Paula Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711. The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, which authorize the commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act, and sec.14.03, which authorizes the commission to adopt rules prohibiting the illegal influence of a race. sec.311.206. Medical Review Officer [Positive Test Results]. (a) The executive secretary shall select a medical review officer to assist the commission in the evaluation of licensees tested under this subchapter. A medical review officer must be professionally trained to evaluate substance and alcohol abuse. In the performance of his or her duties under this subchapter, the medical review officer may designate other persons in the same general locations as the various licensed racetracks to evaluate licensees. To be designated by the medical review officer, a person must be professionally trained to evaluate substance and alcohol abuse. (b)
                                                                                                                    [(a)] The [director of a] laboratory at which a specimen obtained
                                                                                                                      [conducting an analysis] under this subchapter is analyzed
                                                                                                                        shall report all test results in writing to the medical review officer
                                                                                                                          [executive secretary or a designee of the executive secretary]. (c)
                                                                                                                            [(b)] The medical review officer shall review each test result received and determine whether the result constitutes a prima facie violation of the commission's rules. The medical review officer shall then notify the commission in writing of each prima facie violation.
                                                                                                                              Not later than five days after receipt of written notice from the medical review officer of a prima facie violation,
                                                                                                                                [laboratory that a specimen has been found positive for a prohibited substance, the executive secretary shall notify] the tested licensee shall be notified
                                                                                                                                  [,] in writing[,] of the alleged violation
                                                                                                                                    [test result]. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 15, 1993. TRD-9318091 Paula Cochran Carter General Counsel Texas Racing Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 794-8461 16 TAC sec.311.208 The Texas Racing Commission proposes an amendment to sec.311.208, concerning penalties. The amendment outlines the penalties for an individual licensee who has been tested for drugs. Paula Cochran Carter, general counsel for the Texas Racing Commission, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Ms. Carter also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be the assurance that pari-mutuel racing is safe for the licensees and is conducted with utmost integrity. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted on or before March 1, 1993, to Paula Cochran Carter, General Counsel for the Texas Racing Commission, P.0. Box 12080, Austin, Texas 78711. The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, which authorize the commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act, and sec.14.03, which authorizes the commission to adopt rules prohibiting the illegal influence of a race. sec.311.208. Penalties. (a) (No change.) (b) If the stewards or racing judges require a licensee to submit to testing under sec.311. 202 of this title (relating to Subject to Testing) for reasonable belief
                                                                                                                                      [cause], the stewards or racing judges may prohibit the licensee from participating in racing for the remainder of that race day, on the recommendation of a physician who has examined the licensee. (c) For a first violation, the stewards or racing judges shall
                                                                                                                                        [may:] (1) suspend the licensee for at least 30 days; and (2)
                                                                                                                                          [(1)] prohibit the licensee from participating in racing until: (A) the licensee's condition has been evaluated by the medical review officer or a person designated by the medical review officer under sec.311.206 of this title (relating to Medical Review Officer)
                                                                                                                                            [a person approved by the commission who is professionally trained to evaluate substance abuse]; and (B) the licensee has produced a negative test result. [(2) impose a fine in accordance with Chapter 307 of this title (relating to Practice and Procedure). [(d) If the person evaluating a licensee determines the licensee's condition is nonaddictive or not detrimental to the best interest of racing, the stewards or racing judges shall permit the licensee to participate in racing, provided the licensee: [(1) produces a negative test result; and [(2) agrees to further testing to verify continued unimpairment.] [(e) If the person evaluating a licensee determines the licensee's condition is addictive and detrimental to the best interest of racing, the stewards or racing judges shall prohibit the licensee from participating in racing until the licensee: [(1) produces a negative test result; [(2) provides proof that the licensee has satisfactorily completed a certified substance abuse rehabilitation program approved by the commission; and [(3) agrees to further testing to verify continued unimpairment.] (d)
                                                                                                                                              [(f)] For a second [or subsequent] violation, the stewards or racing judges shall: (1) suspend the licensee's license for at least six months; and (2) prohibit the licensee from participating in racing until: (A) the licensee has satisfactorily completed a certified substance abuse rehabilitation program approved by the commission; and (B) produces a negative test result. (e) For a third or subsequent violation, the stewards or racing judges shall suspend the licensee for one year and refer the licensee to the commission. (f)
                                                                                                                                                After a suspended
                                                                                                                                                  [the] licensee has satisfactorily completed a certified substance abuse rehabilitation program approved by the commission, the licensee may apply to have the license reinstated. The commission may reinstate the license if the commission determines the licensee poses no danger to other licensees or race animals and that reinstatement is in the best interest of racing. On reinstatement, the stewards or racing judges shall require the licensee to submit to further drug testing to verify continued unimpairment. (g) (No change.) This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 15, 1993. TRD-9318090 Paula Cochran Carter General Counsel Texas Racing Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 794-8461 Alcohol 16 TAC sec.311.222 The Texas Racing Commission proposes an amendment to sec.311.222, concerning breathalyzer or other test. The amendment clarifies the selection process for licensees to submit to a breathalyzer or other testing while on association grounds. Paula Cochran Carter, general counsel for the Texas Racing Commission, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section. Ms. Carter also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be the assurance that pari-mutuel racing is safe for the licensees and is conducted with utmost integrity. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted on or before March 1, 1993, to Paula Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711. The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, which authorize the commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act, and sec.14.03, which authorizes the commission to adopt rules prohibiting the illegal influence of a race. sec.311.222. Breathalyzer or Other Test. (a) The stewards for racing judges may require a licensee to submit to a breathalyzer test or other noninvasive test at any time while on association grounds. An individual licensee may be selected for testing by a method of random selection prescribed by the commission. The method may be changed from time to time, and it is not an indication of unfairness if a licensee is selected more frequently than any other, providing there is no manipulation of the selection process. An individual licensee may be selected for testing at any time while on association grounds on the basis of reasonable belief. (b)-(c) (No change.) This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 15, 1993. TRD-9318089 Paula Cochran Carter General Counsel Texas Racing Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 794-8461 16 TAC sec.311.223 The Texas Racing Commission proposes an amendment to sec.311.223, concerning penalties. The amendment outlines the penalties for an individual licensee who has been tested for alcohol. Paula Cochran Carter, general counsel for the Texas Racing Commission, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing the section. Ms. Carter also has determined that for each of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be the assurance that pari-mutuel racing is safe for the licensees and is conducted with utmost integrity. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the section as proposed. Comments on the proposal may be submitted on or before March 1, 1993, to Paula Cochran Carter, General Counsel for the Texas Racing Commission, P.O. Box 12080, Austin, Texas 78711. The amendment is proposed under Texas Civil Statutes, Article 179e, sec.3.02, which authorize the commission to adopt rules for conducting racing with wagering and for administering the Texas Racing Act, and sec.14.03, which authorizes the commission to adopt rules prohibiting the illegal influence of a race. sec.311.223. Penalties. (a) For a first violation under sec.311.221 (relating to Prohibited Conduct) or sec.311.222 (relating to Breathalyzer or Other Test), the stewards or racing judges shall prohibit the licensee from participating in racing for the remainder of that race day. In addition, the stewards or race judges may: (1) prohibit the licensee from participating in racing until the licensee's condition has been evaluated by the medical review officer or a person designated by the medical review officer under sec.311.206 of this title (relating to Medical Review Officer)
                                                                                                                                                    [a person approved by the commission who is professionally trained to evaluate alcohol abuse]; and
                                                                                                                                                      [or] (2) (No change.) (b) If the person evaluating a licensee determines the licensee's condition is [nonaddictive or] not detrimental to the best interest of racing, the stewards or racing judges shall permit the licensee to participate in racing, provided the licensee: (1)-(2) (No change.) (c) If the person evaluating a licensee determines the licensee's condition is addictive or
                                                                                                                                                        [and] detrimental to the best interest of racing, the stewards or racing judges shall prohibit the licensee from participating in racing until the licensee: (1)-(3) (No change.) (d)-(e) (No change.) This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 15, 1993. TRD-9318088 Paula Cochran Carter General Counsel Texas Racing Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 794-8461 TITLE 22. EXAMINING BOARDS Part XI. Board of Nurse Examiners Chapter 217. Licensure and Practice 22 TAC sec.217.1, sec.217.6 The Board of Nurse Examiners proposes amendments to sec.217.1 and sec.217.6, concerning Definitions and Temporary Permits. The Nurse Practice Act, Article 4523(b) states that the board may issue a permit to graduate nurse (GN) of an approved educational program and that the GN must work under the direct supervision of an RN. However, direct supervision has not previously been defined. The agency received many inquiries as to the board's interpretation of direct supervision. Therefore, the board is proposing amendments to sec.217. 6 as well as adding a definition to sec.217.1. Louise Waddill, Ph.D., R.N., executive director, has determined that for the first five-year period the sections are in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the sections. Ms. Waddill also has determined that for each year of the first five years the sections are in effect the public benefit anticipated as a result of enforcing the sections will be that GNs and employers of GNs will know the type of supervision that is appropriate for the GNs practice, thus ensuring the public's protection by providing that experienced RNs are available to supervise the GN. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the sections as proposed. Comments on the proposal may be submitted to Louise Waddill, Ph.D., R.N., Executive Director, Board of Nurse Examiners, P.O. Box 140466, Austin, Texas 78714 through March 1, 1993. A public hearing will be scheduled during the regular meeting of the Board on March 23, 1993 at 2 p.m. The amendments are proposed under Texas Civil Statutes, Article 4514, sec.1, which provide the Board of Nurse Examiners with the authority to make and enforce all rules and regulations necessary for the performance of its duties and conducting of proceedings before it. sec.217.1. Deinitions. The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise. Direct supervision -Requires a registered professional nurse to be working on the same unit and readily available to provide consultation and assistance. sec.217.6. Temporary Permit. (a) Examination candidates eligible for temporary permits. (1)-(3) (No change.) (4) A candidate holding a temporary permit to practice professional nursing as a graduate (GN)
                                                                                                                                                          must work under the direct supervision of a registered professional
                                                                                                                                                            nurse[.] who is working on the same unit and is readily available to the GN for consultation and assistance. The GN shall not be placed in a charge position or work in independent practice settings. (5) (No change.) (b) (No change.) (c)-(d) (No change.) This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 22, 1993. TRD-9318087 Louise Waddill, Ph.D., R.N. Executive Director Board of Nurse Examiners Earliest possible date of adoption: March 23, 1993 For further information, please call: (512) 835-8650 TITLE 25. Health Services Part II. Texas Department of Mental Health and Mental Retardation Chapter 402. Client Assignment and Continuity of Services Subchapter H. Placement Appeals Procedures-Mental Retardation Services 25 TAC sec.sec.402.281-402.301 (Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Department of Mental Health and Mental Retardation or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.) The Texas Department of Mental Health and Mental Retardation (TXMHMR) proposes the repeal of sec.sec.402.281-402.301, concerning placement appeals procedures- mental retardation services. The sections would be replaced by new sec.sec.402.281-402.298, relating to placement appeals procedures-mental retardation services, which are proposed contemporaneously for public comment in this issue of the Texas Register. The sections are being repealed to allow for the adoption of new procedures which would implement provisions of the settlement agreement in Lelsz v
                                                                                                                                                              Kavanagh which require the department to simplify the placement appeals process and to describe that process in a simply worded and easily understood format. Leilani Rose, director, Financial Services, has determined that for the first five-year period the repeals are in effect there will be no significant fiscal implications for state or local government as a result of enforcing or administering the repeals. There is no significant local impact anticipated. There is no significant local economic impact anticipated. Jaylon Fincannon, deputy commissioner, Mental Retardation Services, has determined that for each year of the first five years the repeals are in effect the public benefit anticipated as a result of enforcing the repeals will be the replacement of complex, hard-to-understand, and burdensome procedures with streamlined, simplified, and easily followed procedures for appealing decisions regarding community placement of individuals who are residents of mental retardation facilities. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the sections as proposed. Written comments on the proposal may be sent to Linda Logan, director, Policy Development, Texas Department of Mental Health and Mental Retardation, P.O. Box 12668, Austin, Texas 78711-2668, within 30 days of publication. The sections are proposed for repeal under the Health and Safety Code, Title 7, sec.532.015, which provides the Texas Board of Mental Health and Mental Retardation with rulemaking powers. sec.402.28l. Purpose. sec.402.282. Application. sec.402.283. Definitions. sec.402.284. Recommendation for Residential Placement. sec.402.285. Recommendation for Residential Placement Appeals Process-Special Interdisciplinary Team. sec.402.286. Alternative Community Residential Placement Staffing Process. sec.402.287. Residential Placement Appeals Process-Administrative Hearing. sec.402.288. Appointment of a Hearing Officer. sec.402.289. Access to Records. sec.402.290. Prehearing Conference. sec.402.29l. Standard and Burden of Proof. sec.402.292. Notice of Filing; Service of Notices; Certificate of Service. sec.402.293. Representation of Parties. sec.402.294. Notice of Hearing. sec.402.295. Setting a Time and Place for the Administrative Hearing. sec.402.296. Rules of Evidence; Official Notice; Witnesses; Transcription. sec.402.297. Final Decisions. sec.402.298. Residential Placement Appeals Process-Abbreviated Letter Review. sec.402.299. Exhibits. sec.402.300. Distribution. sec.402.30l. References. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 25, 1993. TRD-9318125 Ann Utley Chairman Texas Board of Mental Health and Mental Retardation Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 465-4670 25 TAC sec.sec.402.281-402.298 The Texas Department of Mental Health and Mental Retardation (TXMHMR) proposes new sec.sec.402.281-402.298, concerning placement appeals procedures-mental retardation services. The new sections would replace existing Chapter 402, Subchapter H of this title, relating to placement appeals procedures-mental retardation services, which is proposed contemporaneously for repeal in this issue of the Texas Register. The proposed new sections implement provisions of the settlement agreement in Lelsz v
                                                                                                                                                                Kavanagh which require the department to simplify the placement appeals process and to describe that process in a simply worded and easily understood format. The proposed sections describe a process which requires that the interdisciplinary team (IDT) arrive at a consensus recommendation regarding placement and provides for an automatic appeal to a placement review team (formerly the special IDT). The individual or parent may request an administrative hearing if the team recommends that the current placement be continued and that recommendation is objectionable. The process further requires that the IDT arrive at a consensus recommendation regarding a specific alternate placement and provides for an automatic appeal to an administrative hearing when consensus is not forthcoming. Other new provisions include: the burden of proof is placed on facility staff to prove that a proposed alternate setting is of significant benefit to the individual and meets the right of the individual to live in the least restrictive environment; training in consensus-building is to be provided to all members of the IDT, with a recommendation that each IDT session be opened with just-in-time training; a one-page summary of the placement appeals process is to be included with each notice to the individual or parent; emphasis on the individual's right to be involved in the process and to have his or her desires and aspirations given careful consideration; a requirement that appropriate communication devices and techniques be utilized to ensure that the individual is involved in the process. The sections adopt by reference an operating instruction which restates the policies set forth in the subchapter and, through language and format, provides an easy-to-follow and comprehensive accounting of the procedures required to implement the policies. Also adopted by reference is the one-page summary. Leilani Rose, director, Financial Services Department, has determined that for the first five-year period th sections are in effect there will be no significant fiscal implications for state or local government as a result of enforcing or administering the sections. There is no significant local economic impact anticipated. Jaylon Fincannon, deputy commissioner, Mental Retardation Services, has determined that for each year of the first five years the sections are in effect the public benefit anticipated as a result of enforcing the sections will be the implementation of streamlined, simplified, and easily followed procedures for appealing placement recommendations concerning individuals who are residents of mental retardation facilities. In addition, the new sections would be in compliance with the lawsuit settlement agreement. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the sections as proposed. Written comments on the proposal may be sent to Linda Logan, director, Policy Development, Texas Department of Mental Health and Mental Retardation, P.O. Box 12668, Austin, Texas 78711-2668, within 30 days of publication. A public hearing will be held to accept testimony on the sections as proposed. The hearing will be Thursday, March 4, 1993, at 1:30 p.m., in the TXMHMR Central Office Auditorium at 909 West 45th Street, Austin, Texas 78756. If interpreters for the hearing impaired are required, please notify Ms. Logan 72 hours prior to the hearing by calling (512) 465-4670. The new sections are proposed under the Health and Safety Code, Title 7, sec.532.015, which provides the Texas Board of Mental Health and Mental Retardation with rulemaking powers. sec.402.281. Purpose. The purpose of this subchapter is to describe the policies and procedures concerning the review and appeal of placement recommendations involving individuals receiving residential services in mental retardation facilities. sec.402.282. Application. The provisions of this subchapter apply to all facilities of the Texas Department of Mental Health and Mental Retardation which provide residential mental retardation services. sec.402.283. Definitions. The following words and terms, when used in this subchapter, shall have the following meanings, unless the context clearly indicates otherwise. Competent-As determined by the interdisciplinary team, and consistent with the Health and Safety Code, Title 7, Chapters 591-596 (formerly Persons with Mental Retardation Act, Vernon's Civil Statutes, Article 5547-300), a term used to designate the ability to give legally adequate consent, which means consent given by an individual when each of the following conditions has been met: (A) legal capacity: The individual giving the consent is of the minimum legal age and has not been adjudicated incompetent to manage personal affairs by an appropriate court of law; (B) comprehension of information: The individual giving the consent has been informed of and comprehends the nature, purpose, consequences, risks, and benefits of and alternatives to the procedure, and the fact that withholding or withdrawal of consent shall not prejudice the future provision of care and services to the individual with mental retardation; and (C) voluntariness: The consent has been given voluntarily and free from coercion and undue influence. Commissioner-The commissioner of the Texas Department of Mental Health and Mental Retardation. Consensus-A negotiated agreement that all team members can and will support in implementation. The negotiation process involves the open discussion of ideas with all parties encouraged to express opinions. Department-The Texas Department of Mental Health and Mental Retardation. Deputy commissioner -The deputy commissioner for Mental Retardation Services. Facility-Any state school or state center of the department which provides residential mental retardation services. Guardian-A plenary guardian of the person of an individual with mental retardation. Head of the facility-The superintendent or director of a facility. Hearing officer -Any person designated or appointed by the deputy commissioner to conduct hearings pursuant to this subchapter. Incompetent-As determined by the interdisciplinary team, and consistent with the Health and Safety Code, Title 7, Chapters 591-596 (formerly the Persons with Mental Retardation Act, Vernon's Civil Statutes, Article 5547-300), a term used to designate the inability to give legally adequate consent, which means consent given by an individual when each of the following conditions has been met: (A) legal capacity: The individual giving the consent is of the minimum legal age and has not been adjudicated incompetent to manage personal affairs by an appropriate court of law; (B) comprehension of information: The individual giving the consent has been informed of and comprehends the nature, purpose, consequences, risks, and benefits of and alternatives to the procedure, and the fact that withholding or withdrawal of consent shall not prejudice the future provision of care and services to the individual with mental retardation; and (C) voluntariness: The consent has been given voluntarily and free from coercion and undue influence. Individual-A person receiving residential mental retardation services provided by a facility. This does not include a person in the community receiving services provided through a facility's community- based services program. Interdisciplinary team (IDT)-A group of persons functioning as a team to include: (A) the individual and the parent, unless the competent individual has requested that the parent be excluded; (B) as specified by the facility, persons who are professionally qualified, certified, or both, in various professions with special training and experience in the diagnosis, management, needs, and treatment of individuals with mental retardation; (C) persons who are directly involved in the delivery of mental retardation services to the individual; (D) representative(s) of the appropriate mental retardation authority; and (E) member(s) of the facility's public responsibility committee (PRC), if requested by the PRC, the competent individual, or parent of the incompetent individual. Mental retardation authority (MRA)-The entity designated by the commissioner to direct, operate, facilitate, and/or coordinate services to individuals with mental retardation in a particular various service area of the state as are required to be performed at the local level by state law and the department. Parent- (A) the natural or adoptive mother or father of the individual, but not a mother or father whose parent-child relationship has been legally terminated; (B) a family member or advocate who acts in behalf of the individual instead of the natural or adoptive mother or father and is listed as the primary correspondent for the individual. An individual may choose to have an advocate in addition to a family member, and facility staff shall assist the individual in obtaining an advocate; (C) a legally appointed guardian of the individual; or (D) a legally appointed managing conservator of the individual. Placement review team-A group of persons appointed by the head of the facility to review placement options for an individual when the individual's IDT is unable to arrive at a consensus recommendation regarding placement. None of the persons shall have served on the IDT. Included on the committee will be: (A) representatives of the professional disciplines (psychology, social work, and medical or nursing); (B) a mental retardation professional with knowledge of community programs; and (C) a member of the facility human rights committee and/or the public responsibility committee. Pleadings-Written statements filed by participants concerning their respective positions, claims, and rights in administrative hearings. Preponderance of the evidence-The body of evidence which, when fairly considered, produces the stronger impression. The superiority of weight of testimony is determined by the opportunity for knowledge, the information possessed, and the manner of testifying, rather than by the greater number of witnesses. Public Responsibility Committee (PRC)-An independent, impartial third-party mechanism, the functions, duties, and responsibilities of which are described in Chapter 410, Subchapter A relating to Public Responsibility Committees. Each facility must have a PRC. sec.402.284. Adoption by Reference of Specific Procedures.
                                                                                                                                                                  This subchapter sets forth general policy guidelines for the review and appeals process concerning placement recommendations. Specific procedures are described in detail in Operating Instruction (OI) 402-H, governing Placement Appeals Procedures, which is herein adopted by reference as Exhibit A. sec.402.285. General Provisions. (a) The individual always has the right to be present and to participate in IDT meetings and administrative hearings. The desires and aspirations of the individual shall be given careful consideration when recommendations are made concerning placement. (b) Communication devices and techniques (including the use of sign language) shall be utilized, as appropriate, to facilitate the individual's involvement in the placement process and to ensure that the individual is able to make those desires and aspirations known. (c) Recommendations shall be based on the determination of the least restrictive environment as outlined in Chapter 402, Subchapter G of this title (relating to Determination of the Least Restrictive Environment-Mental Retardation Services.) (d) The competent individual has the right to exclude the parent from participation in: (1) meetings of the interdisciplinary team (IDT) at which placement is to be discussed; and (2) all review and appeal procedures. (e) If the competent individual wishes to include the parent, facility staff shall encourage attendance and participation by the parent. Every reasonable attempt shall be made to schedule meetings at a time that is convenient for the parent. (f) The burden of proof in an administrative hearing lies with facility staff on the IDT to prove by the preponderance of the evidence that a potentially appropriate setting is of significant benefit to the individual and meets the right of the individual to live in the least restrictive environment as guaranteed in the Health and Safety Code, Title 7, Subtitle D, sec.592.013 and sec.592.032. (g) Recommendations by the IDT and the placement review team, as well as the final decision by the hearing officer in an administrative hearing, shall be documented in the record of the individual. (h) Any placement recommendations under appeal as of the effective date of this new subchapter and OI shall be completed under the provisions of the old subchapter. (i) Notices to either the competent individual or the parent of the incompetent individual shall be: (1) in that person's primary language; (2) accompanied by a copy of Summary of Placement Appeals Process, which is herein adopted by reference as Exhibit B; and (3) delivered either in person or by certified mail, return receipt requested. sec.402.286. Placement Recommendation by Interdisciplinary Team. (a) During the annual planning meeting or during a special planning meeting held to consider the placement of an individual residing in a facility, the IDT shall determine by consensus whether the current placement constitutes the least restrictive environment. (b) The IDT shall make a recommendation for: (1) continuation of the current placement; (2) alternate placement in another facility; or (3) alternate placement in a community setting. (c) A summary of the discussion is prepared by a designated facility employee serving on the IDT which includes a fair and accurate recounting of all viewpoints expressed during the meeting. The summary is provided to the competent individual or parent of the incompetent individual within 14 days of the meeting. (d) If there is no consensus, a placement review team shall be named by the head of the facility. sec.402.287. Appeal to the Placement Review Team. (a) The placement review team shall meeting within 14 days of the IDT and review the summary prepared by the designated IDT member and the record of the individual and make a recommendation for: (1) continuation of the current placement; (2) alternate placement in another facility; or (3) alternate placement in a community setting. (b) In arriving at its recommendation, the team also may interview the: (1) individual; (2) parent of the individual, unless the competent individual has excluded the parent from participation in the placement process; (3) other members of the IDT; or (4) other facility staff. (c) If the team's recommendation is for continuation of the current placement and the competent individual or parent of the incompetent individual objects, an administrative hearing shall be held. sec.402.288. Specific Alternate Placement Recommendation by IDT. (a) The IDT shall be convened when a potentially appropriate setting becomes available for an individual recommended for alternate placement in the community or in another facility. (b) A facility employee serving on the IDT who personally knows the individual shall visit the proposed setting prior to the meeting. The individual and parent-if the competent individual wants the parent to be involved-shall be encouraged to visit the proposed setting prior to the meeting. (c) The IDT shall determine by consensus whether the setting is the most appropriate placement for the individual and shall make a recommendation for: (1) continuation of the current placement; or (2) the alternate placement. (d) If there is no consensus, an administrative hearing shall be held. sec.402.289. Initiating the Administrative Hearing Process. (a) Within one day of learning of the need for an administrative hearing, the head of the facility shall notify the deputy commissioner. Within five working days of receiving the notice, the deputy commissioner shall appoint a hearing officer. (b) When feasible, the hearing officer shall be an attorney who is not an employee of the department. If this is not feasible, the person appointed shall: (1) not be permanently employed at the facility where the individual who is to be the subject of the hearing is a resident; (2) not have participated in any aspect of the care and treatment of the individual who is to be the subject of the hearing; and (3) be selected in the manner most economical to the department. (c) The hearing shall be held not less than 14 calendar days but not more than 30 calendar days from the date the deputy commissioner received the request for the hearing. (d) The hearing officer may set a time outside regular business hours and a place away from the facility where the individual resides if a timely request is made by the competent individual or parent of the incompetent individual and the hearing officer determines good cause exists for such a determination. The location selected must be accessible to the handicapped. (e) Notice of the hearing shall be served on all participants no less than seven working days in advance of the hearing date. (f) The hearing officer shall ensure that written notice of the hearing is served personally or by certified mail, return receipt requested. (g) The hearing officer may postpone or continue the hearing until a later date if, in the officer's sound judgment and discretion, there is good cause to do so. Good cause includes, but is not limited to, a finding that a later date would: (1) result in a more just determination of the issues; and (2) not endanger the welfare of the individual. (h) The hearing officer may designate one or more employees of the department or other knowledgeable persons to assist in the evaluation of evidence presented at the hearing. (i) At any time before final judgment is rendered, another hearing officer shall be appointed by the deputy commissioner to perform any remaining functions without having to repeat the previous proceedings in the case if the first hearing officer should die, become disabled, withdraw or be removed from employment, or withdraw or be removed from the proceeding. sec.402.290. Representation of Parties During an Administrative Hearing. (a) The individual, whether competent or incompetent, and all other participants are entitled to be present at the hearing and to be represented or accompanied by legal counsel and/or lay representatives. The competent individual may choose to be represented independently of a parent. (b) The facility or hearing officer may assist the competent individual or parent of the incompetent individual in obtaining representation. sec.402.291. Preparing for an Administrative Hearing. (a) A prehearing conference involving all participants may be called by the hearing officer acting independently or at the request of any of the participants. If all participants consent, the meeting may be conducted by conference call. (b) All participants and their legal and/or lay representatives will have reasonable access to any records concerning the individual who is the subject of the administrative hearing. (c) Whenever any participant files any pleading or motion, a copy of such pleading or motion shall be served on the other participants or their representatives. Notices will be served personally or by certified mail, return receipt requested. sec.402.292. Conducting an Administrative Hearing. (a) The burden of proof in an administrative hearing lies with facility staff on the IDT to prove by the preponderance of the evidence that a potentially appropriate setting will benefit the individual and meets the right of the individual to live in the least restrictive environment as guaranteed in the Health and Safety Code, Title 7, Subtitle D, sec.592.013 and sec.592.032 (formerly the Persons with Mental Retardation Act, Vernon's Civil Statutes, Article 5547-300). (b) The administrative hearing shall be closed to the public unless the competent individual or the parent of the incompetent individual requests a hearing open to the public. (c) The facility shall provide language interpreters and/or an interpreter for the hearing-impaired upon timely request made by a competent individual or the parent of the incompetent individual, legal counsel or lay representative, or upon order of the hearing officer. sec.402.293. Final Decision. (a) The hearing officer must issue a final written decision within five working days of the conclusion of the administrative hearing. (b) Within five working days following the decision by the hearing officer, written notice must be delivered personally or by certified mail, return receipt requested, to: (1) all participants or their legal representatives; and (2) the head of the facility. (c) There is no further administrative appeal from the final decision of the hearing officer; however, this does not preclude the exercise of rights to appeal through the county court granted under the Health and Safety Code, Title 7, sec.594.017 (formerly the Persons with Mental Retardation Act, Vernon's Civil Statutes, Article 5547-300, sec.43.) sec.402.294. Briefing of Staff on Policy. A briefing on the purpose of and major issues addressed in the subchapter and operating instruction shall be provided within 60 days of the effective date to all facility staff who serve or may serve on an IDT or a placement review team, and/or are involved in community placement activities. sec.402.295. Training. Training shall be provided for all members of an IDT in negotiation and consensus building. Just-in-time training on consensus building as the first order of business for each IDT meeting will set the tone for a cooperative and productive meeting. sec.402.296. Exhibits. (a) Exhibit A-Operating Instruction (OI) 402-H, governing Placement Appeals Procedures. (b) Exhibit B-Summary of Placement Appeals Process. sec.402.297. References. Reference is made to the following statutes and rules of the department: (1) Health and Safety Code, Title 7, Chapters 591-596 (formerly the Persons with Mental Retardation Act, Vernon's Civil Statutes, Article 5547-300); (2) Chapter 402, Subchapter G of this title, relating to Determination of Least Restrictive Environment-Mental Retardation Services; (3) Chapter 403, Subchapter K of this title, relating to Client-Identifying Information; (4) Chapter 405, Subchapter AA of this title, relating to Practice and Procedure with Respect to Administrative Hearings at the Department Arising Under the Mentally Retarded Persons Act of 1977; (5) Chapter 410, Subchapter A of this title, relating to Public Responsibility Committees; and (6) Operating Instruction 401-1, relating to Inspection of Department Records. sec.402.298. Distribution. (a) The provisions of this subchapter shall be distributed to members of the Texas Board of Mental Health and Mental Retardation, deputy commissioners, associate deputy commissioners, assistant deputy commissioners, directors and section chiefs of Central Office, superintendents and directors of all department facilities, and board chairpersons and executive directors of all community mental health and mental retardation centers. (b) The superintendent, director, or executive director shall ensure distribution of this subchapter to appropriate staff. (c) A copy of this subchapter shall be made available upon request to any staff member; any individual with mental retardation; the individual's parent; counsel of record of any individual with mental retardation; or to any interested party. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 25, 1993. TRD-9318126 Ann Utley Chairman Texas Board of Mental Health and Mental Retardation Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 465-4670 TITLE 31. NATURAL RESOURCES AND CONSERVATION Part IX. Texas Water Commission Chapter 334. Underground and Aboveground Storage Tanks Subchapter K. Storage, Treatment, and Reuse Procedures for Petroleum Substance Contaminated Media 31 TAC sec.sec.334.481-334.506 (Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Water Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.) The Texas Water Commission proposes the repeal of sec.334.481 and sec.334. 482 and new sec.sec.334.481-334.510 concerning storage, treatment, and reuse procedures for petroleum-substance contaminated soils. This subchapter will provide rules for registering storage and treatment facilities for petroleum- substance contaminated soils. The new rules will replace the current Subchapter K which was adopted as an emergency rule and published in the October 2, 1992, issue of the Texas Register (17 TexReg 6714). The new rules will provide guidance for persons responsible for soil contamination resulting from underground and aboveground storage tanks, as well as for persons who are in the business of operating soil treatment, storage, and recycling facilities. Subchapter K establishes criteria for the registration of such facilities, and prescribes minimum operating standards for the facilities. These rules are proposed under authority of the Texas Water Code, Chapter 26 et seq (Vernon Pamphlet 1992) ("Code"). They were prompted by three concerns. There is a growing problem statewide concerning the ultimate disposition of the contaminated soils when a responsible party performs corrective action at a leaking petroleum storage tank site. Soil surrounding an underground tank or aboveground tank is almost always contaminated. TWC rules normally require cleanup of contaminated soils. If cleanup cannot be accomplished by treating the contaminated soil in place, then the soil is usually hauled to a landfill. But merely taking the problem from point A to point B is no solution. Not only are the costs of hauling soil to landfills increasing, once at the landfill, the contaminated soil is not treated. Thus the environmental hazard remains. Subchapter K provides a mechanism for reducing the environmental hazard by allowing responsible parties to clean the contaminated soil. This subchapter is intended to allow public input into the process by which soil treatment, storage and recycling facilities are registered. Members of the public have legitimate concerns about the location of soil treatment facilities and the standards to which such facilities must adhere. The new Subchapter K rules require persons who apply for registration certificates for soil treatment facilities to hold public meetings prior to commission consideration of their applications. The purpose of the public meeting is twofold: it is informational, intending to give interested individuals background on the nature of the problem associated with petroleum contaminated soils, and a description of the proposed solution; and, the public meeting is also an open forum, where citizens may voice their concerns about the applicant's facility, including the treatment standards, and the impact of the facility on their community. Stephen Minick, Budget and Planning Division, has determined that for the first five years these sections are in effect there will be fiscal implications as a result of enforcement and administration of the sections. Costs to state government are estimated to be approximately $200,000 per year. These costs, however, will be met from existing resources and will require no additional expenditures of state funds. There are no effects on local governments anticipated. These rules will have some effects on businesses operating facilities for the treatment or storage of petroleum-substance contaminated media. Costs will be incurred in the process of making application for facility registration, participation in public hearing processes, and compliance with additional recordkeeping requirements. These costs for most operators are not anticipated to be significant and in no event are anticipated to exceed $3,000 annually. Mr. Minick also has determined that for the first five years these sections will be in effect the public benefit anticipated as a result of enforcement of and compliance with these sections will be improvements in the following: management of state environmental remediation funds and the petroleum storage tank reimbursement program, protection of groundwater resources from the threat of contamination from petroleum product contamination and public participation in the siting and operation of treatment and storage facilities for petroleum- substance contaminated media. Any potential costs to small businesses would be equal to those of a larger concern and would vary proportionately with the size and number of treatment or storage facilities operated. There are no additional costs anticipated for persons required to comply with these sections as proposed. Comments on the proposal may be submitted to Raymond Winter, Staff Attorney, Legal Division, Texas Water Commission, P.O. Box 13087, Austin, Texas 78711- 3087. Comments will be accepted until 5 p.m. on the day 30 days following the date of this publication. The repeals are proposed under the Texas Water Code, sec. s26.341-26.359, as enacted by Senate Bill 779, 70th Legislature, 1987, and as amended by House Bill 1588, 71st Legislature, 1989, and House Bill 1214, 72nd Legislature, 1991, which provides the Texas Water Commission with the authority to establish a program to regulate underground and aboveground storage tanks and to assess and collect fees for deposit to the storage tank fund, and under the Texas Water Code, sec.5.103 and sec.5.105, which authorizes the Texas Water Commission to adopt any rules necessary to carry out its powers and duties under the Texas Water Code and other laws of the State of Texas, and to establish and approve any general policy of the commission. sec.334.481. Definitions. sec.334.482. General Prohibitions. sec.334.483. Disposal by Generator. sec.334.484. Registration Required for Petroleum-Substance Waste Storage or Treatment Facilities. sec.334.485. Authorization for Class C and Class D Facilities. sec.334.486. Exemptions. sec.334.487. Notification and Mobilization Requirements for Class B Facilities. sec.334.488. Effect on Existing Facilities. sec.334.489. Public Notice. sec.334.490. Public Meetings. sec.334.491. Closure and Facility Expansion. sec.334.492. Location Standards for Class A Petroleum-Substance Waste Storage or Treatment Facilities. sec.334.493. Shipping Procedures Applicable to Generators of Petroleum- Substance Waste. sec.334.494. Recordkeeping and Reporting Procedures Applicable to Generators. sec.334.495. Shipping Requirements for Transporters of Petroleum- Substance Waste. sec.334.496. Shipping Requirements Applicable to Owners or Operators of Storage or Treatment Facilities. sec.334.497. Recordkeeping Requirements Applicable to Owners or Operators of Storage or Treatment Facilities. sec.334.498. Additional Reports. sec.334.499. Design and Operating Requirements of Stockpiles and Land Surface Treatment Units. sec.334.500. Reuse of Petroleum-Substance Waste sec.334.501. Contaminant Assessment Program and Corrective Action. sec.334.502. Security. sec.334.503. Contingency Plan. sec.334.504. Emergency Procedures. sec.334.505. Closure for Class A and Class B Facilities. sec.334.506. Financial Assurance. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317960 Mary Ruth Holder Director, Legal Division Texas Water Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 463-8069 31 TAC sec.sec.334.481-334.510 The new sections are proposed under the Texas Water Code, sec.sec.26.341-26. 359, as enacted by Senate Bill 779, 70th Legislature, 1987, and as amended by House Bill 1588, 71st Legislature, 1989, and House Bill 1214, 72nd Legislature, 1991, which provides the Texas Water Commission with the authority to establish a program to regulate underground and aboveground storage tanks and to assess and collect fees for deposit to the storage tank fund, and under sec.sec.5.103 and 5.105, Texas Water Code, which authorizes the Texas Water Commission to adopt any rules necessary to carry out its powers and duties under the Texas Water Code and other laws of the State of Texas, and to establish and approve any general policy of the commission. sec.334.481. Definitions. Except as provided in this subsection, the following words and terms, when used in this subchapter, shall have the following meanings prescribed in sec.334.2 of this title (relating to Definitions), unless the word or term is redefined in this subchapter or unless the context clearly indicates otherwise. Aboveground storage tank-A nonvehicular device (including any associated piping) that is made of nonearthen materials: located on or above the surface of the ground, or on or above the surface of the floor of a structure below ground, such as a mineworking, basement, or vault; and designed to contain an accumulation of petroleum products. Active life-The period from the initial receipt of waste at the facility until the executive director receives certification of final closure. Active portion -That portion of a facility where treatment, or storage operations are being or have been conducted and which is not a closed portion. (See also "closed portion" and "inactive portion.") Activities associated with the exploration, development, and production of oil or gas or geothermal resources-Activities associated with: (A) the drilling of exploratory wells, oil wells, gas wells, or geothermal resource wells; (B) the production of oil or gas or geothermal resources, including: (i) activities associated with the drilling of injection water source wells that penetrate the base of usable quality water; (ii) activities associated with the drilling of cathodic protection holes associated with the cathodic protection of wells and pipelines subject to the jurisdiction of the commission to regulate the production of oil or gas or geothermal resources; (iii) activities associated with gasoline plants, natural gas or natural gas liquids processing plants, pressure maintenance plants, or repressurizing plants; (iv) activities associated with any underground natural gas storage facility, provided the terms "natural gas" and "storage facility" shall have the meanings set out in the Texas Natural Resources Code, sec.91.173; (v) activities associated with any underground hydrocarbon storage facility, provided the terms "hydrocarbons" and "underground hydrocarbon storage facility" shall have the meanings set out in the Texas Natural Resources Code, sec.91.173; and (vi) activities associated with the storage, handling, reclamation, gathering, transportation, or distribution of oil or gas prior to the refining of such oil or prior to the use of such gas in any manufacturing process or as a residential or industrial fuel; (C) the operation, abandonment, and proper plugging of wells subject to the jurisdiction of the Texas Railroad Commission to regulate the exploration, development, and production of oil or gas or geothermal resources; and (D) the discharge, storage, handling, transportation, reclamation, or disposal of waste or any other substance or material associated with any activity listed in subparagraphs (A)-(C) of this paragraph, except for waste generated in connection with activities associated with gasoline plants, natural gas or natural gas liquids processing plants, pressure maintenance plants, or repressurizing plants if that waste is a hazardous waste as defined by the administrator of the United State Environmental Protection Agency pursuant to the Federal Solid Waste Disposal Act, as amended (42 United State Code, sec.6901 et seq) Active geologic processes-Any natural process which alters the surface and/or subsurface of the earth, including, but not limited to, erosion (including shoreline erosion along the coast), submergence, subsidence, faulting, karst formation, flooding in alluvial flood wash zones, meandering river bank cutting, and earthquakes. Manifest-The petroleum-substance waste manifest form furnished by the executive director to accompany shipments of petroleum-substance waste in order to track the movement and transference of petroleum-substance waste. Application-Commission forms or other commission-approved writing on which an executive director registration is requested. Aquifer-A geologic formation, group of formations, or part of a formation capable of yielding groundwater to wells or springs. Area subject to active shoreline erosion -A coastal area where shoreline erosion has been documented within historic time. Areal expansion of an existing facility -The enlargement of a land surface area of an existing petroleum-substance waste management facility from that described in a petroleum-substance waste registration. Areas of direct drainage-Those land areas from which surface water runoff could flow into a lake or other surface water used to supply public drinking water. Authorized-Allowed in writing, by executive director registration, by order, by permit, by license, or by rule. Authorized Representative -The person designated by the owner or operator to represent the facility or the person designated by the waste generator as the generator's representative. Class A facility -A facility which will at any time store or treat petroleum- substance contaminated soils generated from more than one LPST site. Class B facility -A mobile treatment unit which will treat petroleum- substance waste from only one LPST site at a time at that LPST site. The petroleum-substance wastes treated at that site shall have originated from that site. Class C facility -A facility located elsewhere than the LPST site but which will store or treat petroleum-substance waste generated from only that one LPST site. Class D facility -A facility located at the LPST site which will store or treat the petroleum-substance waste generated from only that site. Closed portion -That portion of a facility which an owner or operator has closed in accordance with the approved facility closure plan and all applicable closure requirements. (See also "active portion" and "inactive portion.") Contingency plan -A document setting out an organized, planned, and coordinated course of action to be followed in case of a fire, explosion, or release of waste or waste constituents which could threaten human health and safety or the environment. Critical habitat of a endangered species -An area that is determined by the United States Fish and Wildlife Service to be a critical habitat for an endangered species. Designated facility -The authorized storage, treatment, or disposal facility that has been designated on the petroleum-substance waste affidavit by the generator. Discharge-The accidental or intentional spilling, leaking, pumping, pouring, emitting, emptying, or dumping of waste into or on any land or water. Disposal-The discharge, deposit, injection, dumping, spilling, leaking, or placing of any waste (whether containerized or noncontainerized) into or on any land or water so that such waste or any constituent thereof may enter the environment or be emitted into the air or discharged into or adjacent to any waters, including groundwater. Disposal facility -A facility or part of a facility at which waste is intentionally placed into or on any land or water or adjacent to any water, and at which such waste will remain. Effective substitute -A substance which may be used in the place of another substance for the same purpose without creating adverse environmental conditions. Erosion-The group of natural processes, including weathering, deterioration, detachment, dissolution, abrasion, corrosion, wearing away, and transportation, by which earthen or rock material is removed from any part of the earth's surface. Existing portion -That land surface area of an existing waste management unit, on which wastes have been placed prior to the issuance of a registration. Existing facility -Any petroleum storage, treatment, or recycling facility regulated by the TWC or subject to regulation prior to the effective date of this subchapter. Facility-Includes structures, other appurtenances, and improvements on the land for storing or treating petroleum-substance waste. A facility may consist of several storage or treatment operational units. A facility may also be a mobile treatment unit. Facility operator -The person responsible for the overall operation of a facility or an operation unit (i.e., part of facility), e.g., the plant manager, superintendent, or person of equivalent responsibility for the regulated activity. Facility owner -The person who owns a facility or part of a facility. Final closure-The closure of all waste management units at the facility in accordance with all applicable closure requirements so that waste management activities are no longer conducted at the facility unless subject to the provisions of this title. Generator-Any person who produces petroleum-substance waste; any person who stores or treats petroleum-substance waste; any person who possesses petroleum- substance waste to be shipped to any other person; or any person whose act first causes the petroleum-substance waste to become subject to regulation under this subchapter. Groundwater-Water below the land surface in a zone of saturation. Hazardous waste -Any solid waste identified or listed as a hazardous waste by the administrator of the United States Environmental Protection Agency (EPA) pursuant to the federal Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act, 42 United States Code 6901 et seq, as amended. Inactive portion -That portion of a facility which is not operated. (See also "active portion" and "closed portion".) In operation-Refers to a facility which is treating or storing petroleum- substance waste. In-situ treatment -The reduction of contaminant levels in soil or groundwater which is conducted without removing the contaminated media from the ground. Interim registration -Authorization for a storage or treatment facility received by the facility up to September 25, 1992. Land disposal facility-Any landfill, surface impoundment, waste pile, injection well, or other facility at which waste is finally disposed. Land surface treatment facility-A facility, unit, or part of a facility at which waste is applied onto a liner on the soil surface during treatment. Leaking petroleum storage tank (LPST) site -A site at which a confirmed release of a petroleum substance from an underground or aboveground storage tank has occurred. Petroleum-substance contamination which results from multiple sources may be deemed as one LPST site by the executive director. Liner-A continuous layer of man-made materials, beneath and on the sides of a surface area which restricts the downward and lateral escape of waste, waste constituents, or leachate. Management-The systematic control of the collection, storage, transportation, processing, reuse, treatment, recovery, and disposal of waste. New petroleum-substance waste management facility-Any facility to be used for the storage or treatment of petroleum-substance waste and which is not an existing petroleum substance waste management facility. One hundred-year floodplain-Any land area which is subject to a 1.0% or greater chance of flooding in any given year from any source. On-site-The same or geographically contiguous property which may be divided by public or private rights-of-way. Noncontiguous properties owned by the same person but connected by a right-of-way which that person controls and to which the public does not have access, is also considered on-site property. Operator-Any person in control of or having responsibility for, the daily operation of an underground or aboveground storage tank system. Owner-Any person who currently holds legal possession or ownership of a total or partial interest in the underground storage tank system. For the purposes of this chapter, where the actual ownership of an UST system is either uncertain, unknown, or in dispute, the fee simple owner of the surface estate where the UST is located shall be considered the UST system owner, unless the owner of the surface estate can demonstrate by appropriate documentation (deed reservation, invoice, bill of sale, etc.) or by other legally-acceptable means that the UST system is owned by others. "Owner" does not include a person who holds an interest in an UST system solely for financial security purposes unless, through foreclosure or other related actions, the holder of such security interest has taken legal possession of the UST system. Partial closure -The closure of a petroleum-substance waste management unit in accordance with the applicable closure requirements at a facility that contains other active petroleum-substance waste management units. Person-Any individual, corporation, organization, government or governmental subdivision or agency, business trust, partnership, association, or any other legal entity. Personnel or facility personnel-All persons who work at or oversee the operations of a waste management facility, and whose actions or failure to act may result in noncompliance with the requirements of this subchapter. Petroleum substance -A crude oil or any refined or unrefined fraction or derivative or crude oil which is liquid at standard conditions of temperature and pressure. For the purposes of this subchapter, a "petroleum substance" shall be limited to one or a combination of the substances or mixtures in the following list except for any listed substance regulated as a hazardous waste under the federal Solid Waste Disposal Act, Subtitle C (42 United States Code, sec.6921, et seq). (A) Basic petroleum substances-Crude oils, crude oil fractions, petroleum feedstocks, and petroleum fractions. (B) Motor fuels-See definition for "motor fuel" in sec.334.2 of this chapter (relating to Definitions). (C) Aviation gasolines-Grade 80, Grade 100, and Grade 100-LL. (D) Aviation jet fuels-Jet A, Jet A-1, Jet B, JP-4, JP-5, and JP-8. (E) Distillate fuel oils-Number 1-D, Number 1, Number 2-D, and Number 2. (F) Residual fuel oils-Number 4-D, Number 4-light, Number 4, Number 5-light, Number 5-heavy, and Number 6. (G) Gas-turbine fuel oils-Grade O-GT, Grade 1-GT, Grade 2-GT, Grade 3-GT, and Grade 4-GT. (H) Illuminating oils-Kerosene, mineral seal oil, longtime burning oils, 300 oil, and mineral colza oil. (I) Solvents-Stoddard solvent, petroleum spirits, mineral spirits, petroleum ether, varnish makers' and painters' napthas, petroleum extender oils, and commercial hexane. (J) Lubricants-Automotive and industrial lubricants. (K) Building materials-Liquid asphalt and dust-laying oils. (L) Insulating and waterproofing materials-Transformer oils and cable oils. (M) Used oils-See definition for "used oil" in s334.2 of this chapter (relating to Definitions). (N) Any other petroleum-based material having physical and chemical properties similar to the above materials and receiving approval by the executive director for designation as a petroleum substance. Petroleum substance waste-Any waste, excluding hazardous waste and liquid wastes, which is generated as a result of a release of a petroleum substance from an underground storage tank or a petroleum product from an aboveground storage tank regulated by the commission pursuant to the Texas Water Code, Chapter 26, Subchapter I. Public water system-A system for the provision to the public of piped water for human consumption, if such system has at least 15 service connections or regularly services an average of at least 25 individuals daily at least 60 days out of the year. Registration-Written authorization issued by the executive director, which, by its conditions, may authorize the registrant to construct, install, modify, or operate a petroleum-substance waste storage or treatment facility or unit in accordance with specified limitations. Representative sample -A sample of a universe or whole (e. g., waste pile, groundwater) which can be expected to exhibit the average properties of the universe or whole. Reuse of petroleum-substance wastes-The process by which a petroleum- substance waste is utilized as an effective substitute for a commercial product, such as the proper use as a component of stabilized road base or use as fill for LPST tankholds. Run-off-Any rainwater, leachate, or other liquid that drains over or into land from any part of a facility, land surface treatment unit, or stockpile. Run-on-Any rainwater, leachate, or other liquid that drains over land onto or into any part of a facility, land surface treatment unit, or stockpile. Saturated zone or zone of saturation-That part of the earth's crust in which all voids are filled with water. Secondary containment -A system designed and constructed to collect rainfall run-on and to contain spills, leaks, or discharges within the facility until such waste can be removed. Shipment-Any action involving the conveyance of petroleum-substance waste by any means off-site from the generating site. Sole-source aquifer -An aquifer designated pursuant to the Safe Drinking Water Act of 1974, s1424(e) which solely or principally supplies drinking water to an area, and which, if contaminated, would create a significant hazard to public health. The Edwards Aquifer has been designated a sole-source aquifer by the United States Environmental Protection Agency. The Edwards Aquifer Recharge and Transition Zones are specifically those areas delineated on maps in the offices of the executive director. Spill-The spilling, leaking, pumping, emitting, emptying, or dumping of wastes or materials which, when spilled, become wastes into or on any land or water. Storage-The holding of petroleum-substance waste for a temporary period, prior to the final treatment, disposal of, reuse, or storing of the waste elsewhere. Stockpile-A soil storage area from which all petroleum- substance wastes are removed for treatment or final disposition and from which all wastes are removed at the time of closure of the facility. Thermal treatment unit-An enclosed device using controlled flame combustion, microwave, UV, infrared, or other thermal treatment process. Treatment-Methods which are designed to change, by physical, chemical, or biological means, the levels of contamination of the waste in order to render the waste suitable for reuse or disposal. The term treatment does not include the reduction of contaminant levels by dilution. Treatment facility -A facility or unit which treats or reuses petroleum- substance wastes. Transporter-Any person who conveys or transports petroleum-substance waste by truck, ship, pipeline, or other means. Underground storage tank-Any one or combination of underground tanks and any connecting underground pipes used to contain an accumulation of regulated substances, the volume of which, including the volume of the connecting underground pipes, is ten percent or more beneath the surface of the ground. Unsaturated zone or zone of aeration-The zone between the land surface and the water table. Uppermost aquifer -The geologic formation nearest the natural ground surface that is an aquifer, as well as lower aquifers that are hydraulically interconnected within the facility's property boundary. Waste management area-Any area on which one or more waste management units resides. Waste management unit-A contiguous area of land on or in which waste is placed, or a structure or machine used to store or treat waste. Examples of waste management units include a waste stockpile, a land surface treatment area, a thermal treatment unit, a stockpile, a tank and its associated piping and underlying containment system, and a container storage area. Wetlands-Those areas that are inundated or saturated by surface water or groundwater at a frequency and duration sufficient to support, and that under normal circumstances do support, a prevalence of vegetation typically adapted for life in saturated soil conditions. Wetlands generally include swamps, marshes, bogs, and similar areas. sec.334.482. General Prohibitions. (a) No person may cause, suffer, allow, or permit the storage, treatment, or disposal of petroleum-substance waste in such a manner so as to cause: (1) the discharge or potential threat of discharge into or adjacent to the waters in the state without obtaining specific written authorization for such discharge from the Texas Water Commission; (2) the creation and maintenance of a nuisance; (3) unauthorized releases of contaminants to the air; or (4) the endangerment of the public health and welfare. (b) No person may conduct storage or treatment of contaminated media that is not a petroleum-substance waste at a Class A or Class B facility except as authorized by the executive director or by other appropriate regulations. Any wastes accepted at the facility pursuant to the appropriate authorization shall be managed, stored, and treated separately from the petroleum-substance wastes. sec.334.483. Disposal by Generator. A generator of petroleum- substance waste may not finally dispose of petroleum-substance waste at a site or facility unless the site or facility is authorized to receive such wastes pursuant to one of the following: (1) permit issued by the commission pursuant to Chapter 335 of this title (relating to Industrial Solid Waste and Municipal Hazardous Waste) or Chapter 330 (relating to Municipal Solid Waste Management); (2) authorization issued jointly by the Texas Railroad Commission and the commission for a facility currently permitted by the Railroad Commission; or (3) Section 334.501 of this title (relating to Reuse of Petroleum-Substance Waste) sec.334.484. Registration Required for Petroleum-Substance Waste Storage or Treatment Facilities. (a) A person shall submit the required application and receive the appropriate registration issued after the effective date of these rules prior to storing or treating petroleum-substance wastes at a new Class A facility or treating soil utilizing a new Class B waste management facility. (b) A person may not commence physical construction of a new Class A or utilize a Class B petroleum-substance waste management facility without first having submitted the required application and received the appropriate registration unless otherwise authorized by the executive director. (c) Any person who intends to store or treat petroleum-substance waste at a Class A or Class B facility after the effective date of this subchapter shall submit an application for registration on a form approved by the executive director. Such person shall submit information to the executive director which is sufficiently detailed and complete to enable the commission to determine whether such storage or treatment is compliant with the terms of this subchapter. Such information shall include, at a minimum: (1) information concerning the location of the facility; (2) identification of the facility owner, facility operator, and landowner; (3) the job descriptions of all key operating personnel; (4) documentation on the proposed access routes to the facility, proposed daily volumes of traffic associated with the facility, and confirmation on the suitability of roads leading to the facility; (5) waste storage, management, handling, and shipping methods; (6) waste treatment methods; (7) waste sampling and analytical methods; (8) disposition or reuse documentation; (9) recordkeeping requirements; (10) security and emergency procedures; (11) facility closure specifications; (12) facility plans and specifications; (13) site maps and vicinity maps; (14) documentation on the land use in the vicinity of the facility; (15) identification of all potential contaminant receptors in the vicinity, including any water wells within 1,000 feet; (16) documentation on the financial assurance required; (17) documentation on all required restrictive easements; (18) the geology and hydrogeology where the facility is located; (19) documentation on the effectiveness of the treatment method; (20) documentation of the receipt of any additional authorization required by any other federal, state, or local regulatory agency; and (21) any other information as the executive director may deem necessary to determine whether the facility and operation thereof will comply with the requirements of this subchapter. (d) If the applicant is other than an individual, the application shall be signed by the owner or operator of the facility, the president or chief executive officer of the company, or all the partners of the company. (e) Any person who stores or treats petroleum-substance waste shall have the continuing obligation to immediately provide written notice to the executive director of any changes or additional information concerning the information submitted to the commission or activities authorized in any registration within 15 days of the change or from the date the additional information was acquired. (f) Any information provided under this subsection shall be submitted to the executive director's office in Austin and to the appropriate district office. (g) A registration under this subchapter shall expire five years from the date of issuance. (h) The facility owner or operator shall submit a renewal application at least 60 days prior to the end of the five-year registration period on forms approved by the executive director. (i) The registration is not transferable to any other facility or facility owner. Any transfer of ownership shall require a change in registration of the facility. However, a change in registration of a facility shall not relieve the transferor of any liability. Which may have been incurred prior to the change in registration. sec.334.485. Authorization for Class C and Class D Facilities. Authorization for Class C and Class D facilities is issued by the executive director when the LPST site is subject to a corrective action plan involving storage and treatment activities pursuant to sec.334.81 of this title (relating to Corrective Action Plan). Executive director approval of the corrective action plan for the storage or treatment activities shall constitute authorization for the Class C or Class D facility. A Class C or Class D storage or treatment facility shall remain in operation only as long as is necessary to store or treat the soil from that one LPST site and it shall not accept soil from any other site at any time. The underground or aboveground storage tank owner or operator shall ensure that the approved storage and treatment activities comply with the following applicable provisions of this title: sec.334.482 of this title (relating to General Prohibitions); sec.334.483 of this title (relating to Disposal by Generator); s334.487 of this title (relating to Notification and Mobilization Requirements for Class B Facilities); sec.334.492 of this title (relating to Closure and Facility Expansion); s334.494 of this title (relating to Shipping Procedures Applicable to Generators of Petroleum-Substance Waste); sec.334.495 of this title (relating to Recordkeeping and Reporting Procedures Applicable to Generators); sec.334.496 of this title (relating to Shipping Requirements for Transporters of Petroleum-Substance Waste); sec.334.497 of this title (relating to Shipping Requirements Applicable to Owners or Operators of Storage or Treatment Facilities); sec.334.498 of this title (relating to Recordkeeping Requirements Applicable to Owners or Operators of Storage or Treatment Facilities); sec.334.499 of this title (relating to Additional Reports); sec.334.500 of this title (relating to Design and Operating Requirements of Stockpiles and Land Surface Treatment Units); sec.334. 501 of this title (relating to Reuse of Petroleum-Substance Waste); sec.334.503 of this title (relating to Security); sec.334.504 (relating to Contingency Plan) ; and sec.334.505 of this title (relating to Emergency Procedures). sec.334.486. Exemptions. The following are exempt from the requirements of this subchapter: (1) facilities which operate under the jurisdiction of the Texas Railroad Commission or for the purpose of disposal, facilities permitted or regulated by rules promulgated under the Solid Waste Disposal Act, Chapter 361, Texas Health and Safety Code (Vernon Supplement); and (2) LPST sites which treat petroleum-substance contaminated media if the media is treated in-situ in accordance with the provisions of Subchapter D of this chapter (relating to Release Reporting and Corrective Action.) Such sites, however, are not exempt from the provisions of sec.334.482 of this title (relating to General Prohibitions). sec.334.487. Notification and Mobilization Requirements for Class B Facilities. In addition to the required registration pursuant to sec.334. 484 (relating to Registration Required for Petroleum-Substance Waste Storage and Treatment Facilities). (1) The owner or operator of a Class B facility shall notify the appropriate commission district field office at 48 hours in advance of moving the treatment unit to the LPST site. (2) The owner or operator of the Class B facility shall notify the local fire marshal or other appropriate fire official at least 48 hours in advance of moving the treatment unit to the LPST site. (3) The owner or operator of the underground or aboveground storage tank who intends to utilize a Class B facility at a particular LPST site shall obtain executive director approval pursuant to sec.334.81 of this title (relating to Corrective Action Plan). (4) The Class B facility shall remain at the LPST site for only the time period necessary to complete the treatment, but no longer than 30 days unless written authorization is obtained from the executive director. (5) The facility owner or operator shall provide notice to the public by means of posting signs at the LPST site at least 14 days prior to moving the treatment unit onto the LPST site or within another timeframe as approved by the executive director. The signs shall be legible from a distance of at least 25 feet and shall be posted at all entrances to the facility. The signs shall state "Public Notice of Petroleum-Substance Contaminated Soil Treatment", the name and phone number of the treatment facility owner, the name and phone number of the tank owner or operator, the registration number of the treatment facility, the type of soil treatment to be conducted, and the date(s) the treatment will be conducted. (6) The facility owner or operator shall produce upon demand the registration certificate issued by the TWC under this subchapter as well as any other permit or authorization required by law. sec.334.488. Effect on Existing Facilities. Any Class A or Class B facility which has submitted a registration application between September 25, 1992 (pursuant to the Emergency 31 TAC 334, Subchapter K effective on that date) and the effective date of these rules, is not required to register as a new facility under these rules. Any facility which has not submitted an application for registration between September 25, 1992, and the effective date of these rules shall apply for registration as a new facility. sec.334.489. Notice to Owners or Operators. (a) Written notice shall be provided in accordance with this section to any person, including the tank owner and operator, with any offer to perform any services of storage, treatment or reuse of petroleum-substance contaminated soil proposed after the effective date of these rules. (b) The notice shall contain the following: (1) the facility registration number issued pursuant to this subchapter's registration requirements; (2) the following disclaimer reproduced in its entirety: "The registration of a storage or treatment facility by the Texas Water Commission does not constitute endorsement, licensing, or promotion of any storage or treatment facility. Registration does not imply that the Texas Water Commission guarantees the quality of the work performed or that the cost of the work will be reimbursed". sec.334.490. Public Notice.
                                                                                                                                                                    The facility owner or operator shall provide notice to the general public regarding the location, construction, operation, and potential impacts of the storage or treatment facility. (1) The facility owner or operator shall provide notice of the facility to the general public by means of a notice by publication and a notice by mail. (2) The notice shall contain, at a minimum, the following information in accordance with forms approved by the executive director: (A) the name, address, phone number, and contact person for the owner of the facility; (B) the name, address, phone number, and contact person for the operator of the facility; (C) the name, address, phone number, and contact person for the landowner (if different from the facility owner); (D) the address and the legal description for the location of the facility; (E) the date, time, and location of the public meeting to be held pursuant to sec.334.491 of this title (relating to Public Meetings); (F) notice that an application for registration has been filed with the Texas Water Commission and notice of the application for any necessary permits or exemptions with the Texas Air Control Board or its successor agency; (G) a complete description of the activities which will be conducted at the facility, including details on the construction of the facility, the soil storage methods, the soil treatment methods, the final disposition of the treated soils, and documentation on any points of discharge; (H) the method for obtaining additional information on the facility. (3) The notice by publication shall be published in a newspaper published daily, if available, and generally circulated in the county or area where the proposed facility is to be located and within each county or area wherein persons reside who would be affected by the facility. The notice shall be published at least 10 calendar days prior to the public meeting utilizing the form provided by the executive director. (4) The notice by certified mail, return receipt requested, shall be sent to the following persons at least 10 calendar days prior to the public meeting: (A) all adjacent landowners and all owners of property within 1,000 feet of the facility; (B) the mayor and health authorities of the city in which the facility will be located, if applicable; (C) the county judge and county health authority of the county in which the facility will be located; (D) the appropriate state senator and representative for the area encompassing the facility; (E) the Executive Director of the Air Control Board (effective until September 1, 1993); and (F) all persons or organizations who have requested the notice or expressed interest in the facility. The executive director may designate persons or organizations in addition to those specified by the facility owner or operator. (5) The facility owner or operator shall provide copies of each notice sent by mail, copies of the published notice, and copies of the signed affidavits for the notices to the commission's Austin office and to the appropriate commission district field office within two calendar days of publication and mailing. sec.334.491. Public Meetings.
                                                                                                                                                                      The facility owner or operator, at their expense, shall schedule and hold a public meeting at a time and place which are convenient for the general public affected by the facility. The forum chosen for the meeting shall be accessible to persons who are mobility impaired. Prior to scheduling of the meeting, the applicant shall coordinate the scheduling of the meeting with commission personnel to ensure the availability of commission personnel for the meeting. The applicant shall confirm with the executive director the date, time and location of the meeting not less than 15 days prior to the meeting. The meeting shall be open to the public to provide information on the proposed facility and to allow for comments by the public. The executive director will consider all comments relating to the requirements of this subchapter when determining the outcome of the registration application. The applicant shall again confirm with the executive director on the time and place of the meeting at least 72 hours prior to the meeting. sec.334.492. Closure and Facility Expansion. A person who stores or treats petroleum-substance waste at a Class A or B facility shall notify the executive director in writing of any closure activity or facility expansion not specifically stated in the original application for registration at least 30 days prior to conducting such activity. Such person shall submit to the executive director upon request such information as may reasonably be required to enable the executive director to determine whether such activity is compliant with this subchapter and whether additional public notice should be conducted. Any information provided under this subsection shall be submitted to the executive director's office in Austin and to the appropriate district field office. sec.334.493. Location Standards for Class A Petroleum-Substance Waste Storage or Treatment Facilities. (a) The commission shall not issue a registration for a Class A petroleum- substance waste management facility unless it finds that the proposed site, when evaluated in light of proposed design, construction, and operational features, reasonably minimizes possible contamination of surface water and groundwater. In making this determination, the commission shall consider the following factors: (1) flooding or active geologic processes such as erosion, subsidence, submergence and faulting; (2) groundwater conditions such as groundwater flow rate, groundwater quality, length of flow path to points of discharge and aquifer recharge, or discharge conditions; (3) soil conditions such as stratigraphic profile, stratigraphic complexity, and hydraulic conductivity of strata; (4) separation distance from the facility to the aquifer and to points of discharge to surface water; and (5) climatological conditions. (b) Class A storage or treatment facilities shall not be located: (1) in the 100-year floodplain; (2) in wetlands; (3) on the recharge or transition zone of a sole-source aquifer; (4) within 1,000 feet of an established residence, church, hospital, school, licensed day-care center, or dedicated public park; (5) within 1,000 feet of any property owned by a person other than the facility owner unless a restrictive easement is obtained by the facility owner on the adjacent property to ensure that no residences, schools, churches, hospitals, licensed day-care centers, or dedicated public parks will be constructed within the easement; (6) in areas of direct drainage within one-half mile of any surface water if the surface water is used to supply public drinking water through a public water system, unless it is designed, constructed, operated, and maintained to prevent any releases of contaminants from the facility; (7) in the critical habitat of an endangered species of plant or animal; (8) in an area where the roads leading to the facility which will be utilized to transport soil are not adequate to handle the anticipated traffic volume and load; or (9) in an area where the roads leading to the facility are not designated public roads. (c) The executive director shall determine whether the provisions of this subsection have been met. Nothing in this subchapter shall be construed to require the executive director to issue a registration notwithstanding a finding that the proposed facility would satisfy the requirement of sec.334.493 of this title (relating to Location Standards for Class A Petroleum-Substance Waste Storage or Treatment Facilities) and notwithstanding the absence of site characteristics which would disqualify the site from registration under this section. (d) The executive director may, in his discretion, grant a variance of the requirements of subsection (b) of this section, relating to location requirements for Class A Facilities. Before the executive director may issue a variance under this subsection, he shall require the applicant to demonstrate that the provisions of subsection (b) are not necessary to ensure adequate protection of human health and the environment. sec.334.494. Shipping Procedures Applicable to Generators of Petroleum- Substance Waste. (a) No generator shall transport petroleum-substance waste from the generating site unless the waste has been properly sampled in order to determine the levels of all possible contaminants in the waste. Necessary documentation shall, at a minimum, consist of documentation, on the sampling, handling, chain-of-custody documentation and copies of signed laboratory reports on samples collected from the specified wastes that contain results of analysis for: (1) the major components of the petroleum-substance waste such as benzene, toluene, ethylbenzene, total xylenes, and total petroleum hydrocarbons or the major components of total petroleum hydrocarbons; and (2) any other contaminants as specified by the executive director based on specific conditions of the generating site. (b) No generator of petroleum-substance waste within the State of Texas shall allow the transport of such wastes to an off-site waste storage, treatment, reuse, or disposal facility unless the following requirements are met: (1) a Texas Water Commission (TWC) petroleum-substance affidavit is initiated, to include all applicable information, by the generator; (2) the generator designates on the affidavit at least one facility or area legally authorized to receive the waste. A generator may also designate one alternate facility or area which is legally authorized to receive the waste in the event an emergency prevents delivery of the waste to the primary designated facility. If the transporter is unable to deliver the waste to either the designated facility or the alternate facility, the generator shall either immediately designate another facility for receipt or instruct the transporter to immediately return the waste. Upon such redesignation by the generator, the generator shall immediately prepare an amended waste affidavit. (c) No generator of petroleum-substance waste from outside of the State of Texas shall allow transport of waste into the State of Texas unless the following requirements are met: (1) a TWC petroleum-substance affidavit is initiated by the generator to include all applicable information; (2) the affidavit shall accompany the waste to the receiving facility; (3) the waste is classified as nonhazardous by the state in which it is generated. (d) At the time of waste transfer, the generator or generator's authorized representative shall: (1) sign the affidavit by hand; (2) obtain the handwritten signature of the initial transporter and date of acceptance on the affidavit; (3) retain one copy, in accordance with sec.334.495 of this title (relating to Recordkeeping and Reporting Procedures Applicable to Generators); and (4) give the transporter the remaining copies of the affidavit. sec.334.495. Recordkeeping and Reporting Procedures Applicable to Generators. Each generator, excluding transporters and shippers, of petroleum-substance waste shall comply with the following: (1) the generator shall keep records of all petroleum-substance waste activities regarding the quantities generated and shipped off-site for storage, treatment, or disposal and which, at a minimum, includes the information described in paragraphs (1)-(5) of this section. The maintained records shall be retrievable, legible, and immediately available for inspection and copying by commission personnel. The required records shall be sufficiently detailed and complete to support any contentions or claims made by the generator with respect to the following: (A) the description, character and classification of each waste; (B) the quantity of waste and the date(s) it was generated; (C) identification of the generating location and the tank owner or operator; (D) the methods of storage, treatment, or disposal; (E) the quantity and date(s) the waste was shipped off-site for storage, treatment, or disposal including the name, address and location of each off-site facility and transporter receiving shipments. (2) The generator shall retain a legible copy of each waste affidavit required by sec.334.494 of this title (relating to Shipping Procedures Applicable to Generators of Petroleum-Substance Waste) for a minimum of five years from the date of shipment by the generator. (3) A generator of petroleum-substance waste shall keep records of all test results, waste analyses, or other determinations made for at least five years from the date that the waste was last sent to an off-site storage, treatment, disposal, or reuse area or facility. (4) A generator who does not receive a copy of the affidavit with the handwritten signature of the owner or operator of the designated facility within 35 days from the date the waste was accepted by the initial transporter shall contact the transporter and/or the owner or operator of the designated facility to determine the status of the petroleum-substance waste. (5) A generator shall submit an exception report to the executive director if the generator has not received a copy of the affidavit with the handwritten signature of the owner or operator of the designated facility within 45 days of the date that the waste was accepted by the initial transporter. The exception report shall be retained by the generator for at least five years from the date the waste was accepted by the initial transporter and shall include: (A) a legible copy of the affidavit for which the generator does not have confirmation of delivery; and (B) a legible copy of a letter signed by the generator or his authorized representative explaining the efforts taken to locate the waste and the results of those efforts. (6) The periods of record retention required by this subsection may be extended by the executive director during the course of any unresolved enforcement action regarding the regulated activity. sec.334.496. Shipping Requirements Applicable to Transporters of Petroleum- Substance Waste. (a) No transporter shall ship petroleum-substance waste to an off-site storage, treatment, or disposal facility, unless the transporter: (1) obtains an affidavit initiated by the generator in accordance with sec.334.494 of this title (relating to Shipping Procedures Applicable to Generators of Petroleum-Substance Waste); and (2) upon receipt and prior to shipment, signs, and dates the affidavit acknowledging the acceptance of waste from the generator where appropriate; (b) The transporter shall ensure that the affidavit accompanies the petroleum- substance waste. (c) No transporter shall deliver a shipment of petroleum-substance waste to another transporter designated on the affidavit, unless the delivering transporter: (1) obtains the date of delivery and the handwritten signature of the accepting transporter on the affidavit; and (2) gives the legible copies of the affidavit to the accepting transporter; (d) No transporter shall deliver a shipment of petroleum-substance waste to a storage, treatment, or disposal facility, unless the transporter: (1) obtains the date of delivery and the handwritten signature on the affidavit of the owner or operator of the facility designated on the affidavit; and (2) gives the copies of the affidavit to the owner or operator of the storage, treatment or disposal facility designated on the affidavit. (e) The transporter shall deliver the entire quantity of petroleum-substance waste which the transporter has accepted from a generator or a transporter to: (1) the designated facility listed on the affidavit; (2) the alternate designated facility if the waste cannot be delivered to the designated facility because an emergency prevents delivery; or (3) the next designated transporter. (f) If the transporter cannot deliver the waste in accordance with subsection (e) of this section, the transporter shall immediately contact the generator for further directions and shall revise the affidavit according to the generator's instructions. sec.334.497. Shipping Requirements Applicable to Owners or Operators of Storage, Treatment, or Disposal Facilities. (a) No owner or operator of a storage, treatment or disposal facility may accept delivery of petroleum-substance waste for storage, treatment, or disposal unless: (1) a PST-waste affidavit accompanies the shipment which designates that facility to receive the waste; (2) the facility owner or operator signs the affidavit and immediately gives at least one copy of the signed affidavit to the transporter; (3) retains one copy of the affidavit in accordance with sec.334.498 of this title (relating to Recordkeeping Requirements Applicable to Owners or Operators of Storage, Treatment or Disposal Facilities); and (4) within 30 days after receipt of the waste, sends a copy of the affidavit to the generator; (b) When a facility or reuse area receives petroleum-substance waste accompanied by a affidavit, the facility owner or operator, or his agent, or the owner or operator of the property designated for the reuse area shall note any significant discrepancies on each copy of the affidavit. (1) Significant discrepancies are differences between the quantity or type of waste designated on the affidavit and the quantity or type of waste a facility actually received. Significant discrepancies in type of waste are obvious differences which can be discovered by inspection or waste analysis. (2) Upon discovering a significant discrepancy, the facility owner or operator shall attempt to reconcile the discrepancy with the waste generator or transporter (e.g., with telephone conversations). If the discrepancy is not resolved within 15 days after receiving the waste, the facility owner or operator shall, within five days, submit to the executive director a letter describing the discrepancy and attempts to reconcile it, and a copy of the affidavit at issue. The facility owner or operator shall ensure that the waste is a petroleum-substance waste eligible for acceptance by the facility pursuant to this subchapter and shall report any unreconciled discrepancies discovered during any analyses or evaluation. (c) No owner or operator of a storage, treatment, or disposal facility in Texas shall accept wastes from an out-of-state generator or location unless the following requirements are met: (1) the waste is accompanied by legible copies of the signed TWC waste affidavits for all wastes received pursuant to sec.334. 494 (relating to Shipping Procedures Applicable to Generators of Petroleum-Substance Wastes); (2) the facility owner or operator obtains documentation that the wastes contain only petroleum-substance contamination, have been generated from an underground or aboveground storage tank as defined in this chapter, and are classified as nonhazardous in the state where generated. This documentation shall consist of documentation on the sampling methods, sample handling, chain- of-custody documents, and legible copies of signed laboratory reports on samples collected from the specified wastes. The number of samples shall be sufficient to characterize the entire quantity of wastes. The analyses shall include: (A) volatiles and Semi-Volatiles by EPA Methods 8240 and 8250; (B) TC-listed constituents as specified in 40 Code of Federal Regulations, Part 261; (C) organichlorine pesticides and PCBs by EPA Method 8080; and (D) any other analyses necessary to characterize the wastes or as specified by the executive director; and (3) the facility owner or operator obtains documentation from the appropriate governing agency in the originating jurisdiction that the wastes are classified as nonhazardous and meet the definition of petroleum-substance wastes, (as such wastes are defined in sec.334.2 of this chapter relating to definitions). (d) The facility owner or operator shall not accept any wastes for storage, treatment, or disposal from an in-state generator or location which contain any contaminants above natural background levels other than petroleum substances as defined in this subchapter, unless otherwise approved by the executive director. Documentation of the contaminants in the waste shall consist of a sufficient number of samples to characterize the waste and the samples shall be analyzed for all constituents that may occur in that waste. sec.334.498. Recordkeeping Requirements Applicable to Owners or Operators of Storage, Treatment, or Disposal Facilities. (a) All records required by this subchapter shall be retained by the facility owner or operator for a minimum of five years from the date of receipt of the waste. The records shall be maintained in a secure location on the premises of the storage, treatment, or disposal facility and shall be immediately accessible by the facility owner and operator. In the event that copies of the required records cannot reasonably be maintained on the premises of the facility, then such records may be maintained at a readily-accessible alternate site, provided that the following conditions are met. (1) If the facility is in operation, the records shall be readily accessible for reference by the facility owner and operator. (2) The records shall be readily accessible and available for inspection and copying upon request by commission personnel. (3) The facility owner or operator shall provide the following information in writing to the executive director and to the commission's appropriate district office: (A) the specific location where the required records are maintained; and (B) the name, address, and telephone number of the authorized custodian of the records. (4) The written information required in paragraph (3) of this subparagraph shall be submitted with the application for registration and within 15 days after the records are moved to an alternate site from that specified in the registration. (b) For facilities which have completed the closure requirements and are no longer in service, the facility owner may submit the appropriate records required by this subchapter to the executive director in lieu of maintaining the records on the premises or at an alternate site, provided that the following conditions are met. (1) The facility owner shall provide written justification adequate to explain why the records cannot be maintained at a readily-accessible alternate site. and (2) The records shall be submitted at one time in one package for each facility, and the records shall be appropriately labeled with the facility identification number and location information. (c) A facility owner or operator who initiates a shipment of petroleum- substance waste from a treatment or storage facility shall comply with the generator standards contained in sec.334.494 of this title (relating to Shipping Procedures Applicable to Generators of Petroleum-Substance Waste) and sec.334.495 of this title (relating to Recordkeeping and Reporting Procedures Applicable to Generators) and this subsection. (d) The periods of record retention required by this subsection may be extended by the executive director during the course of any unresolved enforcement action regarding the regulated activity. (e) The following information, at a minimum, shall be maintained by the facility owner or operator: (1) documentation on all shipments of contaminated media received at the facility as specified on the waste affidavit; (2) the method(s) of storage or treatment for all media received; (3) the method of reuse or disposal of all wastes removed from the facility including: (A) the location of final disposition; (B) the quantity and contaminant levels of wastes placed at any and every location; (C) the name, work address, and work phone number of the authorized representative for the receiving facility or location. If the receiving facility cannot be identified by street address, then other specifics shall be included to adequately identify the exact location; (D) the name, work address, and work phone number of the authorized representative for the landowner at the receiving location; (E) documentation on the soil sampling and analytical methods, chain-of- custody, and all analytical results for the soil received at the facility and transported off-site or reused on-site; (F) a detailed description of the reuse methods; (G) the date(s) of transport off-site and the dates of reuse; (H) legible copies of the authorization from the landowner at the receiving location pursuant to sec.334. 501 of this title (relating to Reuse of Petroleum- Substance Waste); (4) documentation on the operations at the facility, including: (A) information on the actual treatment efficiency of the unit; (B) documentation on the results of all air emissions monitoring; (C) any changes in the operations at the facility; (D) documentation on any releases, fires, or explosions and the measures taken to abate the situation; (5) monitoring data under sec.334.502 of this title (relating to Contaminant Assessment Program and Corrective Action) when required; (6) a summary of the types and volumes of any petroleum-substance waste received without affidavits. This documentation shall include the following information: (A) the dates the facility received the wastes; (B) the LPST or other identification number of the generating facility, and the names and addresses of the tank owner or operator and the transporter, if available; (C) a description and the quantity of each petroleum-substance waste the facility received which was not accompanied by a PST-waste affidavit; (D) the method of storage and/or treatment for each petroleum-substance waste; (7) any other information deemed necessary by the executive director. sec.334.499. Additional Reports.
                                                                                                                                                                        The owner or operator of a Class A or Class B facility shall report to the executive director within twenty-four hours of the occurrence any releases, fires, explosions, breakdowns, shutdowns, releases, or spills which result or may result in the discharge of any contaminants to the ground, surface water, or groundwater. sec.334.500. Design and Operating Requirements of Stockpiles and Land Surface Treatment Units. (a) A stockpile or land surface treatment unit located at any storage or treatment facility or at any LPST site shall have an appropriate means of preventing any discharge or release of petroleum-substance waste or petroleum- substance waste constituents into any media. This shall be accomplished with: (1) a synthetic, impermeable liner that is designed, constructed, and installed to prevent any migration of petroleum-substance wastes out of the stockpile or land surface treatment unit into the adjacent subsurface soil, groundwater, or surface water at any time during the active life (including the closure period) of the stockpile, or land surface treatment unit. The liner shall be constructed of materials that do not allow petroleum-substance waste or petroleum-substance waste constituents to migrate into the liner itself or into the adjacent subsurface soil, groundwater, or surface water during the active life of the facility. The liner shall: (A) be constructed of materials that have appropriate chemical properties and sufficient strength and thickness to prevent failure due to pressure gradients (including static head and external hydrogeologic forces), physical contact with the hydrocarbons or leachate to which they are exposed, climatic conditions, the stress of installation, and the stress of daily operations; (B) be placed upon a foundation or base capable of providing support to the liner and resistance to pressure gradients above and below the liner to prevent failure of the liner due to settlement, compression, tearing or uplift; (C) be installed to cover all surrounding earth likely to be in contact with the petroleum-substance waste or leachate; and (D) contain a leachate collection and removal system immediately above the liner that is designed, constructed, maintained, and operated to collect and remove leachate and rainwater from the stockpile or land surface treatment unit. The facility owner and operator shall specify the design and operating conditions which will ensure that the leachate depth over the liner does not exceed the depth of soil on the liner. The leachate collection and removal system shall be constructed of materials that are: (i) chemically resistant to the hydrocarbons managed in the pile and the leachate expected to be generated; and (ii) of sufficient strength and thickness to prevent collapse under the pressures exerted by overlaying petroleum-substance wastes, petroleum-substance waste cover materials, and any equipment used at the stockpile or treatment unit; and (iii) designed and operated to function without clogging through the scheduled life of the stockpile or land surface treatment unit; or (2) An alternate design or operating practice that is effective in preventing any release or discharge and is approved by the executive director. The facility owner or operator shall demonstrate that the alternate design or operating practices, together with location characteristics, will prevent the migration of any petroleum-substance waste constituents into the soil, groundwater or surface water at any future time. In deciding whether to approve the alternate design, the executive director will consider: (A) the nature and quantity of the wastes; (B) the proposed alternate design and operation; (C) the hydrogeologic setting of the facility, including a tentative capacity and thickness of the liners and soils present between the stockpile or land surface treatment unit and groundwater or surface water; and (D) all other factors which would influence the quality and mobility of the leachate produced and the potential for it to migrate to soil, groundwater or surface water. (b) The facility owner or operator shall design, construct, operate, and maintain a run-on control system capable of preventing flow onto the active portion of the stockpile or land surface treatment unit. (c) The facility owner or operator shall design, construct, operate, and maintain a run-off management system to prevent flow from a stockpile or land surface treatment unit. (d) Collection and holding facilities (e.g., tanks or basins) associated with run-on and run-off control systems shall be emptied and managed expeditiously in accordance with applicable state and federal requirements after storms to maintain design capacity of the system. (e) If the stockpile or land surface treatment unit contains any particulate matter which may be subject to wind dispersal, the facility owner or operator shall cover or otherwise manage the stockpile or land surface treatment unit to control wind dispersal. (f) The executive director may specify other design and operating practices that may be necessary to ensure that the requirements of this subsection are satisfied. (g) The facility owner or operator shall ensure that treatment is initiated on stockpiled soil within 90 days from the date of receipt at the facility and that the treated soil is removed from the facility for final disposition within 90 days after completing treatment. (h) In addition to the requirements specified in subsections (a)-(g) of this section, the facility owner or operator shall design, construct, operate, and maintain the land surface treatment unit to maximize the degradation, transformation, or immobilization of petroleum-substance waste constituents in the treatment area. At a minimum, the facility owner or operator shall specify the following items, if applicable, in the facility registration application: (1) the rate and method of petroleum-substance waste application to the treatment area; (2) measures to control soil Ph; (3) measures to enhance microbial or chemical reactions (e.g., fertilization); and (4) measures to control the moisture content of the treatment area. (i) The facility owner or operator shall inspect the unit weekly and after storms to detect evidence of: (1) deterioration, malfunctions, or improper operation of run-on and run-off control systems; and (2) improper functioning of wind dispersal control measures. sec.334.501. Reuse of Petroleum-Substance Waste. (a) Wastes that are intended for reuse are subject to all the applicable provisions of this subchapter, including but not limited to the following requirements: sec.334.482. of this title (relating to General Prohibitions), sec.334.494 of this title (relating to Shipping Procedures Applicable to Generators of Petroleum-Substance Waste), sec.334.495 of this title (relating to Recordkeeping and Reporting Procedures Applicable to Generators), sec.334.496 of this title (relating to Shipping Requirements for Transporters of Petroleum- Substance Waste), sec.334.497 of this title (relating to Shipping Requirements Applicable to Owners or Operators of Storage, Treatment, or Disposal Facilities), sec.334.498 of this title (relating to Recordkeeping Requirements Applicable to Owners or Operators of Storage, Treatment, or Disposal Facilities), and sec.334.500 of this title (relating to Design and Operating Requirements of Stockpiles and Land Surface Treatment Units). (b) Recordkeeping and reporting requirements for any person who intends to reuse petroleum-substance wastes shall require that person to maintain records and provide to the executive director when requested such information deemed necessary by the executive director to ensure compliance with the requirements of this subsection. This information may include, but is not limited to: (1) identification, address, and name of the authorized representative of the generating facility; (2) identification, address, and name of the authorized representative for the receiving facility or location; (3) identification of the landowner of the receiving location or facility; (4) the quantity, type, and contaminant levels of the reused wastes; (5) documentation of the reuse methods and dates of reuse; (6) documentation that asphalt mix or roadbase mix meets the specifications required by the final user; (7) documentation that the landowner of the receiving location has approved the use of the reused wastes on his property; (c) Reuse requirements. (1) Any person who intends to utilize petroleum-substance wastes for reuse shall obtain written approval from the landowner of the land on which the wastes will be placed. (2) Petroleum-substance wastes shall be reused only in manners which are in accordance with sec.334.482 (relating to General Prohibitions) and at contaminant levels as specified by the executive director. (3) Petroleum-substance wastes may be reused under the following conditions. (A) Petroleum-substance wastes may be utilized in cold-mix-emulsion bituminous paving at a cold-mix asphalt-producing facility registered under the terms of this subchapter. The petroleum-substance waste shall be mixed with aggregate or other suitable materials at a rate which will result in a mixture meeting or exceeding the specifications required by the final user. The petroleum-substance waste shall contain less than 0.5 mg/kg for each component of benzene, toluene, ethylbenzene, and total xylenes prior to mixing. Authorization for the facility shall also be obtained from all other appropriate federal, state, or local governing agencies. Authorization from the owner of the road or other area where the asphalt is to be utilized shall be obtained prior to laying the asphalt. (B) Petroleum-substance wastes with nonhazardous contaminant levels may be utilized in asphalt mix at hot-mix asphalt-producing facilities registered under this subchapter. The petroleum-substance waste shall contain less than 0.5 mg/kg for each component of benzene, toluene, ethylbenzene, and total xylenes prior to mixing. The petroleum-substance waste shall be mixed with aggregate at a rate which will result in a mixture meeting or exceeding the specifications required by the final user. Authorization for the facility shall also be obtained from all other appropriate federal, state, or local governing agencies. Authorization from the owner of the road or other area where the asphalt is to be utilized shall be obtained prior to laying the asphalt. (C) Petroleum-substance wastes may be utilized in roadbase or parking lot stabilized base when the base will be covered with concrete or asphalt if the contaminant levels of the soil prior to mixing into the stabilized base are less than 0.5 mg/kg for each component of benzene, toluene, ethylbenzene, and total xylenes, and less than 500.0 mg/kg total petroleum hydrocarbons or at contaminant levels otherwise specified by the executive director. The base shall be mixed according to the specifications required by the final user. Soil which is not mixed into stabilized roadbase shall meet the criteria for clean soil as specified by the executive director in order to be spread on a road or parking lot. The generator shall obtain prior written consent for the placement of the soil from the owner of the road (if different from the landowner). (D) Petroleum-substance wastes may be utilized in roadbase or parking lot stabilized base when the base will not be covered with asphalt or concrete if the contaminant levels are less than 0.5 mg/kg for each component of benzene, toluene, ethylbenzene, and total xylenes, and less than 200 mg/kg of total petroleum hydrocarbons or at contaminant levels otherwise specified by the executive director. The base shall be mixed according to the specifications required by the final user. The base shall be professionally mixed by a facility registered under the terms of this subchapter. Soil which is not mixed into stabilized roadbase shall meet the criteria for clean soil in order to be spread on a road or parking lot. The generator shall obtain prior written consent for the placement of the soil from the owner of the road (if different from the landowner). (E) Petroleum-substance wastes may be used as fill in another LPST site tankhold if the contaminant levels do not exceed 0.5 mg/kg for each component of benzene, toluene, ethylbenzene, and total xylenes, and 10.0 mg/kg total petroleum hydrocarbons. Other contaminant levels may be considered by the executive director if documentation indicates that there is no threat to public health or safety and if there is no threat of groundwater contamination at the receiving site. The owner of the underground storage tanks at the receiving facility, and the landowner (if different from the tank owner) shall give written consent for this activity. The soil shall not be utilized in a tankhold in which a new tank installation will occur. (F) Petroleum-substance waste may be reused by alternative methods or contaminant levels deemed appropriate and as authorized by the executive director. The generator shall obtain authorization, including authorization pursuant to the requirements of this subchapter, from the executive director prior to reusing the waste by alternative methods. sec.334.502. Contaminant Assessment Program and Corrective Action. (a) The facility owner or operator shall conduct an assessment when, in the opinion of the executive director, there exists a possibility of migration of contaminants into or adjacent to waters in the state. The assessment shall be capable of determining: (1) whether petroleum-substance waste or petroleum-substance waste constituents have entered the groundwater, surface water, or soils; (2) the rate and extent of migration of any petroleum-substance waste or petroleum-substance waste constituents in the soil, groundwater, or surface water; and (3) the concentrations of petroleum-substance waste or petroleum-substance waste constituents in the soil, groundwater, or surface water. (b) The owner or operator of the facility shall conduct corrective action at the facility when, in the opinion of the executive director, petroleum-substance waste constituents exist in the soil, groundwater, or nearby surface water at levels which are harmful to human health and safety or the environment. (c) The corrective action program shall be capable of preventing the migration of contaminants and shall prevent the contaminants from exceeding the levels determined by the executive director. (d) The facility owner or operator shall ensure that the corrective action measures under this subsection shall be initiated and completed within a reasonable period of time as determined by the executive director considering the extent of contamination. The executive director may issue additional directives should the corrective action activities prove to not be effective in reducing the contaminant levels at a sufficient rate. (e) The facility owner or operator shall report in writing to the executive director the effectiveness of the corrective action program. The facility owner or operator shall submit these reports to the commission's Austin office and to the appropriate commission district office upon request by the executive director. sec.334.503. Security. (a) The facility owner or operator shall prevent unauthorized entry by persons or animals onto the facility. (b) A facility shall have: (1) a 24-hour surveillance system (e.g., television monitoring or surveillance by guards or facility personnel) which continuously monitors and controls entry onto the active portion of the facility; or (2) an artificial or natural barrier (e.g., a fence in good repair or a fence combined with a cliff), which completely surrounds the active portion of the facility; and (3) a means to control entry, at all times, through the gates or other entrances to the active portion of the facility (e.g., an attendant, television monitors, locked entrance, or controlled roadway access to the facility). (c) A sign with the legend, "Caution-Unauthorized Personnel Keep Out" shall be posted at each entrance to the active portion of a facility, and at other locations, in sufficient numbers to be seen from any approach to the active portion. The legend shall be written in English and in any other language predominant in the area surrounding the facility, and shall be legible from a distance of at least 25 feet. Existing signs with a legend other than "Caution- Unauthorized Personnel Keep Out" may be used if the legend on the sign indicates that only authorized personnel are allowed to enter the active portion, and that entry onto the active portion can be dangerous. (d) The owner or operator of the facility shall submit details of the proposed security measures in the application for registration. sec.334.504. Contingency Plan. (a) Each facility owner or operator shall have a contingency plan for each facility. The contingency plan shall be designed to minimize hazards to human health or the environment from fires, explosions, or any release of petroleum- substance waste or petroleum-substance waste constituents to air, soil, groundwater, or surface water. (b) The provisions of the plan shall be carried out immediately whenever there is a fire, explosion, or release of petroleum-substance waste or petroleum- substance waste constituents which could threaten human health or the environment. (c) The contingency plan shall describe the actions facility personnel shall take in order to respond to fires, explosions, or any release of petroleum- substance waste or petroleum-substance waste constituents to air, soil, or surface water at the facility. (d) The plan shall list names, addresses, and phone numbers (office and home) of all persons qualified to act as facility emergency coordinators and this list shall be kept up to date. Where more than one person is listed, one shall be named as primary emergency coordinator and others shall be listed in the order in which they will assume responsibility as alternates. (e) The plan shall include a list of all emergency equipment at the facility, such as fire extinguishing systems, spill control equipment, communications and alarm systems (internal and external). This list shall be kept up to date. In addition, the plan shall include the location and a physical description of each item on the list, and a brief outline of its capabilities. (f) The plan shall include an evacuation plan for facility personnel where there is a possibility that evacuation could be necessary. This plan shall describe signal(s) to be used to begin evacuation, evacuation routes, and alternate evacuation routes (in cases where the primary routes could be blocked by release of petroleum-substance waste or fires). (g) A legible copy of the contingency plan and all revisions to the plan shall be: (1) submitted to the executive director with the application for registration; (2) maintained at the facility; and (3) submitted to all local fire departments or emergency response officials that may be called upon to provide emergency services. (h) The contingency plan shall be reviewed, and immediately amended, if necessary, whenever: (1) the facility registration is revised; (2) the plan fails in an emergency; (3) the facility changes its design, construction, operations, maintenance, or other circumstances in a way that materially increases the potential for fires, explosions, or release of petroleum-substance waste or petroleum-substance waste constituents, or changes the response necessary in an emergency; (4) the list of emergency coordinators changes; or (5) the list of emergency equipment changes. sec.334.505. Emergency Procedures. (a) At all times, there shall be at least one employee either on the facility premises or on call (i.e. , available to respond to an emergency by reaching the facility within a short period of time) with the responsibility for coordinating all emergency response measures. This emergency coordinator shall be thoroughly familiar with all aspects of the facility's contingency plan, all operations and activities at the facility, the location and characteristics of waste handled, the location of all records within the facility, and the facility layout. In addition, this person shall have the authority to commit the resources needed to carry out the contingency plan. (b) Whenever there is an imminent or actual emergency situation, the emergency coordinator (or his designee when the emergency coordinator is on call) shall immediately: (1) activate internal facility alarms or communication systems, where applicable, to notify all facility personnel; and (2) notify appropriate state or local agencies with designed response roles if their help is needed. (c) Whenever there is a release, fire, or explosion, the emergency coordinator shall immediately identify the character, exact source, amount, and areal extent of any released materials. The emergency coordinator may do this by observation or review of facility records or affidavits, and, if necessary, by chemical analysis. (d) Concurrently, the emergency coordinator shall assess possible hazards to human health or the environment that may result from the release, fire, or explosion. This assessment shall consider both direct and indirect effects of the release, fire, or explosion (e.g., the effects of any toxic, irritating, or asphyxiating gases that re-generated, or the effects of any surface water run- off from water or chemical agents used to control fire and heat-induced explosions). (e) If the emergency coordinator determines that the facility has had a release, fire, or explosion which could threaten human health or the environment outside the facility, the emergency coordinator shall report his findings as follows: (1) if the emergency coordinator's assessment indicates that evacuation of local areas may be advisable, the emergency coordinator shall immediately notify appropriate local authorities. The emergency coordinator shall be available to help appropriate officials decide whether local areas should be evacuated; and (2) the emergency coordinator shall immediately notify either the government official designated as the on-scene coordinator for that geographical area, the Texas Emergency Response Center at (512) 463-7727, or the National Response Center (using their 24-hour toll free number (800) 424-8802). The report shall include: (A) name and telephone number of reporter; (B) name and address of facility; (C) time and type of incident (e.g., release, fire); (D) name and quantity of material(s) involved, to the extent known; and (E) the possible hazards to human health or the environment outside the facility. (f) During an emergency, the emergency coordinator shall take all reasonable measures necessary to ensure that fires, explosions, and releases do not occur, recur, or spread to other petroleum-substance waste at the facility. These measures shall include, where applicable, stopping processes and operations, collecting and containing released waste, and removing or isolating containers. (g) If the facility stops operations in response to a fire, explosion, or release, the emergency coordinator shall monitor for leaks, pressure buildup, gas generation, or ruptures in valves, pipes, or other equipment, wherever this is appropriate. (h) Immediately after an emergency, the emergency coordinator shall provide for treating, storing, and/or disposing of recovered water, contaminated soil and surface water, and any other material that results from a release, fire or explosion at the facility. (i) The emergency coordinator shall ensure that, in the affected area(s) of the facility, all emergency equipment listed in the contingency plan is cleaned and fit for its intended use before operations are resumed. (j) The facility owner or operator shall notify the executive director and appropriate State and local authorities that the facility is in compliance with subsection (h) of this section before operations are resumed in the affected areas(s) of the facility. (k) The facility owner or operator shall note in the operating record the time, date, and details of any incident that requires implementing the contingency plan. Within 15 days after the incident, the facility owner or operator shall submit a written report on the incident to the executive director. The report shall include: (1) name, address, and telephone number of the facility owner or operator; (2) name, address, and telephone number of the facility; (3) the facility's registration number; (4) date, time, and type of incident (e.g. fire, explosion); (5) name and quantity of material(s) involved; (6) the extent of injuries, if any; (7) an assessment of actual or potential hazards to human health or the environment, where this is applicable; and (8) estimated quantity and disposition of recovered material that resulted from the incident. sec.334.506. Closure Requirements Applicable to Class A and Class B Facilities. (a) Except as provided in this subsection, the facility owner or operator shall submit his closure plan to the executive director for approval with the application for registration. (b) In the closure plan the facility owner or operator shall address the following objectives and indicate how they will be achieved: (1) removal and decontamination of all structures, equipment, or improvements which will no longer be utilized at the facility; (2) removal and proper disposal or treatment and reuse of all petroleum- substance wastes from the facility; and (3) removal or treatment of any petroleum-substance waste and petroleum- substance waste constituents which exist above the established cleanup levels that have been released from the facility into the soil, groundwater, or surface water. (c) During the closure period the facility owner or operator of a petroleum- substance treatment facility shall: (1) continue the contaminant assessment or corrective action at the facility as directed by the executive director; (2) maintain the run-on and run-off control systems required under sec.334.500 of this title (relating to Design and Operating Requirements of Stockpiles and Land Surface Treatment Units); (3) control wind dispersal of particular matter which may be subject to wind dispersal. (d) When closure is completed the facility owner or operator shall submit to the executive director for approval certification both by the facility owner or operator and by an independent qualified hydrogeologist, geologist, or an independent registered professional engineer, that the facility has been closed in accordance with the specifications in the approved closure plan. (e) The facility owner or operator shall prepare a written estimate, in current dollars, of the cost of closing the facility in accordance with the closure plan as specified in sec.334.507 of this title (relating to General Requirements for Financial Assurance). The closure cost estimate shall equal the cost of closing at the point in the facility's operating life when the extent and manner of its operation would make closure the most expensive, as indicated by its closure plan. The closure cost estimate shall be based on the costs to the facility owner or operator of hiring a third party to close the facility. A third party is a party who is neither a parent nor a subsidiary for the facility owner or operator. Notwithstanding other closure costs, such estimate shall also include the costs associated with third party removal, shipment off-site, and treatment or disposal off-site of the following wastes to an authorized storage, treatment, or disposal facility: (1) maximum inventory of wastes in storage and/or treatment units; (2) any contaminated soils, groundwater, or surface water generated as a result of releases at the site; (3) wastes generated as a result of closure activities; (4) contaminated stormwater or leachate. (f) The closure cost estimate may not incorporate any salvage value that may be realized by the sale of petroleum-substance wastes, facility structures or equipment, land, or other facility assets at the time of partial or final closures. The facility owner or operator may not incorporate a zero cost for petroleum-substance waste that might have economic value. (g) The facility owner or operator shall adjust the closure cost estimate for inflation within 30 days after each anniversary of the date on which the first closure cost estimate was prepared. The adjustment shall be made as specified in paragraphs (1) and (2) of this subsection, using an inflation factor derived from the most recent Implicit Price Deflator for Gross National Product published by the United States Department of Commerce in its Survey of Current Business
                                                                                                                                                                          . The inflation factor is the result of dividing the latest published annual Deflator by the Deflator for the previous year. (1) The first adjustment is made by multiplying the closure cost estimate by the inflation factor. The result is the adjusted closure cost estimate. (2) Subsequent adjustments are made by multiplying the latest adjusted closure cost estimate by the latest inflation factor. (h) The facility owner or operator shall revise the closure cost estimate whenever a change in the closure plan increases the cost of closure. The revised closure cost estimate shall be adjusted for inflation as specified in this subsection. (i) The facility owner or operator shall keep the following at the facility during the operating life of the facility: the latest closure cost estimate prepared in accordance with subsections (e) and (f) of this section and, when this estimate has been adjusted in accordance with subsection (g) of this section, the latest adjusted closure cost estimate. sec.334.507. General Requirements for Financial Assurance. An owner or operator of a Class A or B petroleum-substance waste storage or treatment facility shall establish financial assurance for the closure of each Class A or B facility. (1) The financial assurance shall be in the amount specified in the cost estimate for closure pursuant to sec.334.506 of this title (relating to Closure Requirements Applicable to Class A and Class B Facilities). (2) The financial assurance shall consist of one or more of the mechanisms pursuant to sec.334.508 of this title (relating to Financial Assurance Mechanisms). (3) An owner or operator of an existing Class A or Class B facility shall submit documentation of the effective financial assurance within 60 days of the effective date of this subchapter. An owner or operator of a new Class A or Class B facility shall submit documentation of financial assurance with the application for registration pursuant to sec.334. 484 of this title (relating to Registration Required for Petroleum-Substance Waste Storage or Treatment Facilities). (4) All mechanisms for financial assurance shall be prepared on forms, or utilize wording, approved by the executive director. (5) Whenever the current closure cost estimate changes, the owner or operator shall compare the new estimate with the amount in the financial assurance mechanism. If the value of the mechanism is less than the amount of the new estimate, the owner or operator, within 60 days after the change in the cost estimate, shall either increase the amount in the mechanism so that its value after the increase at least equals the amount of the current closure cost estimate, or obtain other financial assurance as specified in this section to cover the difference. The owner or operator shall submit evidence of such increase to the executive director. Whenever the current cost estimate decreases, the value of the mechanism may be reduced to the amount of the current closure estimate following written approval by the executive director. (6) If the value of the financial assurance mechanism is greater than the total amount of the current closure cost estimate, or if an owner or operator substitutes another financial assurance mechanism as specified in this section for all or part of the initial mechanism, the owner or operator may submit a written request to the executive director to decrease the amount of the mechanism to the current closure cost estimate. The owner or operator shall obtain written approval from the executive director for the decrease. (7) An owner or operator who utilizes a surety bond guaranteeing payment into a closure trust fund, a surety bond guaranteeing performance of a closure, or a closure letter of credit, shall also establish a standby trust fund. Under the terms of the mechanism, all payments made thereunder will be deposited by the surety directly into the standby trust fund in accordance with instructions from the executive director. This standby trust fund shall meet the wording specified on forms approved by the executive director except that: (A) an originally signed duplicate of the trust agreement shall be submitted to the executive director with the surety bond; and (B) until the standby trust fund is funded pursuant to the requirements of this section, the following are not required by these regulations: (i) payments into the trust fund as specified in this section; (ii) annual valuations as required by the trust agreement; and (iii) notices of nonpayment as required by the trust agreement. (8) The executive director will give written consent to termination of the financial assurance mechanism when: (A) an owner or operator substitutes and receives approval from the executive director for alternate financial assurance as specified in this section; or (B) the executive director releases the owner or operator from the requirements of this section in accordance with sec.334.507(8) of this title (relating to General Requirements for Financial Assurance). (9) Following a determination that the owner or operator has failed to perform final closure in accordance with the closure plan and other regulatory requirements when required to do so, the executive director shall utilize the mechanism to complete the site closure. (10) Within 60 days after receiving certifications from the owner or operator and an independent qualified hydrogeologist, geologist, or independent registered professional engineer, that closure has been accomplished in accordance with the closure plan, the executive director will notify the owner or operator in writing that he is no longer required by this section to maintain financial assurance for closure of the facility, unless the executive director has reason to believe that closure has not been in accordance with the closure plan. sec.334.508. Mechanisms for Financial Assurance. A facility owner or operator shall utilize one or more of the following mechanisms for financial assurance. (1) Closure trust fund. For the use of a closure trust fund, the following items apply in addition to the requirements pursuant to sec.334.507 of this title (relating to General Requirements for Financial Assurance). (A) The trustee of the fund shall be an entity which has the authority to act as a trustee and whose trust operations are regulated and examined by a federal or state agency. (B) After beginning final closure, an owner or operator or any other person authorized to perform closure may request reimbursement for closure expenditures by submitting itemized bills to the executive director. Within 60 days after receiving bills for closure activities, the executive director will determine whether the closure expenditures are in accordance with the closure plan or otherwise justified, and if so, will instruct the trustee to make reimbursement in such amounts as the executive director specifies in writing. If the executive director has reason to believe that the cost of closure will be significantly greater than the value of the trust fund, the executive director may withhold reimbursement of such amounts as deemed prudent until it is determined, in accordance with sec.334.507 of this title (relating to General Requirements for Financial Assurance), that the owner or operator is no longer required to maintain financial assurance for closure. (2) Surety bond guaranteeing payment into a closure trust fund. For the use of a surety bond guaranteeing payment into a closure fund, the following items apply in addition to the requirements pursuant to sec.334.507 of this title (relating to General Requirements for Financial Assurance). (A) The bond shall, at a minimum, be among those listed as acceptable sureties on Federal bonds in Circular 570 of the United States Department of Treasury. (B) The bond shall guarantee that the owner or operator will: (i) fund the standby trust fund in an amount equal to the penal sum of the bond before beginning closure of the facility; or (ii) fund the standby trust fund in an amount equal to the penal sum within 15 days after an order to begin closure is issued by the executive director or a United States district court or other court of competent jurisdiction; or (iii) within 90 days after receipt by both the owner or operator and the executive director of a notice of cancellation of the bond from the surety, provide alternate financial assurance as specified in this section, and obtain the executive director's written approval of the assurance provided. (C) Under the terms of the bond, the surety will become liable on the bond obligation when the owner or operator fails to perform as guaranteed by the bond. (D) Under the terms of the bond, the surety may cancel the bond by sending notice of cancellation by certified mail to the owner or operator and to the executive director. Cancellation may not occur, however, during 120 days beginning on the date of the receipt of the notice of cancellation by both owner or operator and the executive director as evidenced by the returned receipts. (E) The owner or operator may cancel the bond if the executive director has given prior written consent based on his receipt of evidence of alternate financial assurance as specified in this section. (3) Surety bond guaranteeing performance of closure. For the use of a surety bond guaranteeing performance of closure, the following items apply in addition to the requirements pursuant to sec.334.507 (relating to General Requirements for Financial Assurance). (A) The bond shall, at a minimum, be among those listed as acceptable sureties on Federal bonds in Circular 570 of the United States Department of Treasury. (B) The bond shall guarantee that the owner or operator will: (i) perform closure in accordance with the closure plan and other requirements of the registration for the facility whenever required to do so; or (ii) within 90 days after receipt by both the owner or operator and the executive director of a notice of cancellation of the bond from the surety, provide alternate financial assurance as specified in this section, and obtain the executive director's written approval of the assurance provided; (iii) become liable on the bond obligation when the owner or operator fails to perform as guaranteed by the bond. Following a determination by the executive director that the owner or operator has failed to perform closure in accordance with the closure plan and other registration requirements when required to do so, under terms of the bond the surety will perform closure as guaranteed by the bond or will deposit the amount of the penal sum into the standby trust fund; (iv) may cancel the bond by sending notice of cancellation by certified mail to the owner or operator and to the executive director. Cancellation may not occur, however, during the 120 days beginning on the date of receipt of the notice of cancellation by both the owner or operator and the executive director, as evidenced by the return receipts; (v) will not be liable for deficiencies in the performance of closure by the owner or operator after the executive director releases the owner or operator from the requirements of this section in accordance with sec.334.507(h) of this title (relating to General Requirements for Financial Assurance). (4) Closure letter of credit. For the use of a Closure letter of credit, the following items apply in addition to the requirements pursuant to sec.334.507 of this title (relating to General Requirements for Financial Assurance). (A) The issuing institution shall be an entity which has the authority to issue letters of credit and whose letter of credit operations are regulated and examined by a Federal or State agency. (B) The letter of credit shall be accompanied by a letter from the owner or operator referring to the letter of credit by number, issuing institution, and date, and providing the following information: the TWC facility identification number, name, and address of the facility, and the amount of funds assured for closure of the facility by the letter of credit. (C) The letter of credit shall be irrevocable and issued for a period of at least one year. The letter of credit shall provide that the expiration date will be automatically extended for a period of at least one year unless, at least 120 days before the current expiration date, the issuing institution notifies both the owner or operator and the executive director by certified mail of a decision not to extend the expiration date. Under the terms of the letter of credit, the 120 days will begin on the date when both the owner or operator and the executive director have received the notice, as evidenced by the return receipts. (D) If the owner or operator does not establish alternate financial assurance as specified in this section and obtain written approval of such alternate assurance from the executive director within 90 days after receipt by both the owner or operator and the executive director of a notice from the issuing institution that it has decided not to extend the letter of credit beyond the current expiration date, the executive director will draw on the letter of credit. The executive director may delay the drawing if the issuing institution grants an extension of the term of the credit. During the last 30 days of any such extension, the executive director will draw on the letter of credit if the owner or operator has failed to provide alternate financial assurance as specified in this section and obtain written approval of such assurance from the executive director. (5) Closure insurance. For the use of closure insurance, the following items apply in addition to the requirements pursuant to sec.334.507 of this title (relating to General Requirements for Financial Assurance). (A) At a minimum, the insurer shall be chartered and licensed in at least one state and authorized to engage in the business of insurance. (B) The closure insurance policy shall be issued for a face amount at least equal to the current closure estimate, except as provided in sec.334.508(g) of this section. The term "face amount" means the total amount the insurer is obligated to pay under the policy. Actual payments by the insurer will not change the face amount, although the insurer's future liability will be lowered by the amount of the payments. (C) The closure insurance policy shall guarantee that funds will be available whenever final closure occurs. The policy shall also guarantee that once closure begins, the issuer will be responsible for paying out funds, up to an amount equal to the face amount of the policy, upon the direction of the executive director, to such party or parties as the executive director specifies. (D) After beginning closure, an owner or operator or any other person authorized to perform closure may request reimbursement for closure expenditures by submitting itemized bills to the executive director. Within 60 days after receiving bills for closure activities, the executive director will determine whether the closure expenditures are in accordance with the closure plan or otherwise justified, and if so, he will instruct the insurer to make reimbursement in such amounts as the executive director specifies in writing. If the executive director has reason to believe that the cost of closure will be significantly greater than the face amount of the policy, he may withhold reimbursement of such amounts as he deems prudent until he determines, in accordance with sec.334.507 of this title (relating to General Requirements for Financial Assurance), that the owner or operator is no longer required to maintain financial assurance for closure of the facility. (E) The owner or operator shall maintain the policy in full force and effect until the executive director consents to termination of the policy by the owner or operator as specified in sec.334.507(f) of this title (relating to General Requirements for Financial Assurance). Failure to pay the premium, without substitution of alternate financial assurance as specified in this section, will constitute a significant violation of these regulations, warranting such remedy as the executive director deems necessary. Such violation will be deemed to begin upon receipt by the executive director of a notice of future cancellation, termination, or failure to renew due to nonpayment of the premium, rather than upon the date of expiration. (F) The policy shall provide that the insurer may not cancel, terminate, or fail to renew the policy except for failure to pay the premium. The automatic renewal of the policy shall, at a minimum, provide the insured with the option of renewal at the face amount of the expiring policy. If there is a failure to pay the premium, the insurer may elect to cancel, terminate, or fail to renew the policy by sending notice by certified mail to the owner or operator and the executive director. Cancellation, termination, or failure to renew may not occur, however, during 120 days beginning with date of receipt of the notice by both the executive director and the owner or operator, as evidenced by the return of receipts. Cancellation, termination, or failure to renew may not occur and the policy will remain in full force and effect in the event that on or before the date of expiration: (i) the executive director deems the facility abandoned; or (ii) the registration is terminated or revoked or a new registration is denied; or (iii) closure is ordered by the executive director or a United States district court or other court of competent jurisdiction; or (iv) the owner or operator is named as debtor in a voluntary or involuntary proceeding under Title 11 (Bankruptcy), United States Code; or (v) the premium due is paid. (6) Financial test and corporate guarantee for closure. For the use of a financial test and corporate guarantee for closure, the following items apply in addition to the requirements pursuant to sec.334.507 of this title. (A) To pass this test the owner or operator shall meet the either of the following criteria: (i) the owner or operator shall have: (I) two of the following three ratios. A ratio of total liabilities to net worth less than 2.0; a ratio of the sum of net income plus depreciation, depletion, and amortization to total liabilities greater than 0.1; and a ratio of current assets to current liabilities greater than 1.5; and (II) net working capital and tangible net worth each at least six times the sum of the current closure cost estimate and liability coverage requirements for petroleum-substance waste facilities and any other financial assurance obligations under other EPA or state environmental regulations assured by a financial test; and (III) tangible net worth of at least $10 million; and (IV) assets in the United States amounting to at least 90% of the owner's or operator's total assets or at least six times the sum of the current closure cost estimate and liability coverage requirements for petroleum-substance waste facilities and any other financial assurance obligations under other EPA or state environmental regulations assured by a financial test; (ii) the owner or operator shall have: (I) a current rating for his most recent bond issuance of AAA, AA, A, or BBB as issued by Standard and Poor's or Aaa, Aa, A, or Baa as issued by Moody's; and (II) tangible net worth at least six times the sum of the current closure cost estimate and liability coverage requirements for petroleum-substance waste facilities and any other financial assurance obligations under other EPA or state environmental regulations assured by a financial test; and (III) tangible net worth of at least $10 million; and (IV) assets located in the United States amounting to at least 90 percent of the owner's or operator's total assets or at least six times the sum of the current closure cost estimates and liability coverage requirements for petroleum-substance waste facilities and any other financial assurance obligations under other EPA or state environmental regulations assured by a financial test. (B) To demonstrate that he meets this test, the owner or operator shall submit the following items to the executive director: (i) a letter signed by the owner's or operator's chief financial officer and worded as specified in forms approved by the executive director; and (ii) a copy of the independent certified public accountant's report on examination of the owner's or operator's financial statements for the latest completed fiscal year; and (iii) special report from the owner's or operator's independent certified public accountant to the owner or operator stating that: (I) he has compared the data which the letter from the chief financial officer specifies as having been derived from the independently audited, year- end financial statements for the latest fiscal year with the amounts in such financial statements; and (II) in connection with that procedure, no matters came to his attention which caused him to believe that the specified data should be adjusted. (C) After the initial submission of items specified in subparagraph (B) of this section, the owner or operator shall send updated information to the executive director within 90 days after the close of each succeeding fiscal year. This information shall consist of all items specified in subparagraph (B) of this section. (D) If the owner or operator no longer meets the requirements of paragraph (2) of this section, he shall send notice to the executive director of intent to establish alternate financial assurance as specified in this section. The notice shall be sent by certified mail within 90 days after the end of the fiscal year for which the year-end financial data show that the owner or operator no longer meets the requirements. The owner or operator shall provide the alternate financial assurance within 120 days after the end of such fiscal year. (E) The executive director may, based on a reasonable belief that the owner or operator may no longer meet the requirements of subparagraph (B) of this section, require reports of financial condition at any time from the owner or operator in addition to those specified in subparagraph (B) of this section. If the executive director finds, on the basis of such reports or other information, that the owner or operator no longer meets the requirements of subparagraph (B) of this section, the owner or operator shall provide alternate financial assurance as specified in this section within 30 days after notification of such a finding. (F) The executive director may disallow use of this test on the basis of qualifications in the opinion expressed by the independent certified public accountant in his report on examination of the owner's or operator's financial statements. An adverse opinion or disclaimer of opinion will be cause for disallowance. The executive director will evaluate other qualifications on an individual basis. The owner or operator shall provide alternate financial assurance as specified in this section within 30 days after notification of the disallowance. (G) An owner or operator may meet the requirements of this section by obtaining a written guarantee, hereafter referred to as "corporate guarantee." The guarantee shall be the direct or higher-tier parent corporation of the owner or operator, a firm whose parent corporation is also the parent corporation of the owner or operator, or a firm with a "substantial business relationship" with the owner or operator. The guarantee shall meet the requirements for owners or operators in paragraphs (6)(A)-(E) of this section and shall comply with the terms of the corporate guarantee. The wording of the corporate guarantee shall be on forms approved by the executive director. The corporate guarantee shall accompany the items sent to the executive director as specified in paragraph (6)(B) of this section, and if the guarantor's parent corporation is also the parent corporation of the owner or operator, the letter shall describe the value received in consideration of the guarantee. If the guarantor is a firm with a "substantial business relationship" with the owner or operator, the letter shall describe this "substantial business relationship" and the value received in consideration of this corporate guarantee. The terms of the corporate guarantee shall provide that: (i) if the owner or operator fails to perform closure of the facility covered by the corporate guarantee in accordance with the closure plan and other registration requirements whenever required to do so, the guarantor will do so or establish a trust fund as specified in the name of the owner or operator; (ii) the corporate guarantee will remain in force unless the guarantor sends notice of cancellation by certified mail to the owner or operator and the executive director, as evidenced by the return receipts. Cancellation may not occur, however, during the 120 days beginning on the date of receipt of the notice of cancellation by both the owner or operator and the executive director, as evidenced by the return receipts; (iii) if the owner or operator fails to provide alternate financial assurance as specified in this section and obtain the written approval of such alternate assurance from the executive director within 90 days after receipt by both the owner or operator and the executive director of a notice of cancellation of the corporate guarantee from the guarantor, the guarantor will provide such alternative financial assurance in the name of the owner or operator. (7) Use of multiple financial mechanisms. An owner or operator may satisfy the requirements of this section by establishing more than one financial mechanism per facility. These mechanisms are limited to trust funds, surety bonds, letters of credit, and insurance. The mechanisms shall be as specified in paragraphs (1), (2), (4), and (5), of this section, except that it is the combination of mechanisms, rather than the single mechanism, which shall provide financial assurance for an amount at least equal to the adjusted closure cost. If an owner or operator uses a trust fund in combination with a surety bond or letter of credit, the owner or operator may use that trust fund as the standby trust fund for the other mechanisms. A single standby trust may be established for two or more mechanisms. The executive director may invoke any or all of the mechanisms to provide for closure of the facility. (8) Use of a financial mechanism for multiple facilities. An owner or operator may use a financial assurance mechanism specified in this section to meet the requirements of this section for more than one facility. Evidence of financial assurance submitted to the executive director shall include a list showing, for each facility, the TWC Identification Number, name, address, and the amount of funds for closure assured by the mechanism. The amount of funds available through the mechanism shall be no less than the sum of funds that would be available if a separate mechanism had been established and maintained for each facility. In directing funds available through the mechanism for closure of any of the facilities covered by the mechanism, the executive director may direct only the amount of funds designated for that facility, unless the owner or operator agrees to use additional funds available under the mechanism. sec.334.509. Liability Requirements for Class A and B Facilities. (a) An owner or operator of a Class A or B petroleum-substance waste facility shall establish financial assurance for bodily injury and property damage to third parties caused by sudden accidental occurrences arising from operations of the facility or group of facilities. The owner or operator shall have and maintain liability coverage for sudden accidental occurrences in the amount of at least $1 million per occurrence with an annual aggregate of at least $2 million, exclusive of legal defense costs. For new petroleum-substance waste storage or treatment facilities, documentation of the required financial security shall be submitted with the application for registration. The owners or operators of existing authorized facilities shall obtain and submit to the executive director financial assurance within 60 days of the effective date of these rules. The owner or operator shall choose from the options as specified in subsections (d)(1)-(6) of this section. (b) An owner or operator shall notify the executive director in writing within 30 days: (1) whenever a claim for bodily injury or property damages caused by the operation of a petroleum-substance waste storage or treatment facility is made against the owner or operator or an instrument providing financial assurance for liability coverage under this section; and (2) whenever the amount of financial assurance for liability coverage under this section provided by a financial instrument authorized by paragraphs (d)(1) -(6) of this section is reduced. (c) Within 60 days after receiving certifications from the owner or operator and an independent qualified hydrogeologist, geologist, or an independent registered professional engineer, that final closure has been completed in accordance with the approved closure plan, the executive director will notify the owner or operator in writing that he is no longer required by this section to maintain liability coverage for that facility, unless the executive director has reason to believe that closure has not been in accordance with the approved closure plan. (d) Acceptable mechanisms for liability coverage. (1) Trust fund for liability coverage. (A) An owner or operator may satisfy the requirements of this section by establishing a trust fund which conforms to the requirements of this paragraph and submitting an originally signed duplicate of the trust agreement to the executive director. (B) The trustee shall be an entity which has the authority to act as a trustee and whose trust operations are regulated and examined by a federal or state agency. (C) The trust fund for liability coverage shall be funded for the full amount of the liability coverage to be provided by the trust fund before it may be relied upon to satisfy the requirements of this section. If at any time after the trust fund is created the amount of funds in the trust fund is reduced below the full amount of the liability coverage to be provided, the owner or operator, by the anniversary date of the establishment of the fund, shall either add sufficient funds to the trust fund to cause its value to equal the full amount of liability coverage to be provided, or obtain other financial assurance as specified in this section to cover the difference. For purposes of this paragraph, "the full amount of liability coverage to be provided" means the amount of coverage for sudden occurrences required to be provided less the amount of liability coverage being provided by other financial assurance mechanisms being used to demonstrate financial assurance by the owner or operator. (D) The wording of the trust fund shall be on forms approved by the executive director. (2) Surety bond for liability coverage. (A) An owner or operator may satisfy the requirements of this section by establishing a surety bond which conforms to the requirements of this paragraph and submitting a copy of the bond to the executive director. (B) The surety company issuing the bond shall be among those listed as acceptable sureties on Federal bonds in the most recent Circular 570 of the United States Department of the Treasury. (3) Letter of credit for liability coverage. (A) An owner or operator may satisfy the requirements of this section by establishing an irrevocable standby letter of credit which conforms to the requirements of this paragraph and submitting a copy of the letter of credit to the executive director. (B) The financial institution issuing the letter of credit shall be an entity that has the authority to issue letters of credit and whose letter of credit operations are regulated and examined by a federal or state agency. (C) The wording of the letter of credit shall be on forms approved by the executive director. (4) Financial test for liability coverage. (A) An owner or operator may satisfy the requirements of this section by demonstrating that he passes a financial test as specified in this paragraph. To meet this test the owner or operator shall meet the criteria of clause (i) or (ii) of this subparagraph: (i) the owner or operator shall have: (I) two of the following three ratios: A ratio of total liabilities to net worth less than 2.0; a ratio of the sum of net income plus depreciation, depletion, and amortization to total liabilities greater than 0.1; and a ratio of current assets to current liabilities greater than 1.5; and (II) net working capital and tangible net worth each at least six times the sum of the current closure cost estimate and liability coverage requirements for petroleum-substance waste facilities and any other financial assurance obligations under other EPA or state environmental regulations assured by a financial test; and (III) tangible net worth of at least $10 million; and (IV) assets in the United States amounting to at least 90% of his total assets or at least six times the sum of the current closure cost estimate and liability coverage requirements for petroleum-substance waste facilities and any other financial assurance obligations under other EPA or state environmental regulations assured by a financial test; (ii) the owner or operator shall have: (I) a current rating for the owner's or operator's most recent bond issuance of AAA, AA, A, or BBB as issued by Standard and Poor's or Aaa, Aa, A, or Baa as issued by Moody's; and (II) tangible net worth at least six times the sum of the current closure cost estimate and liability coverage requirements for petroleum-substance waste facilities and any other financial assurance obligations under other EPA or state environmental regulations assured by a financial test; and (III) tangible net worth of at least $10 million; and (IV) assets located in the United States amounting to at least 90% of the owner's or operator's total assets or at least six times the sum of the current closure cost estimates and liability coverage requirements for petroleum- substance waste facilities and any other financial assurance obligations under other EPA or state environmental regulations assured by a financial test. (B) To demonstrate that the owner or operator meets this test, the owner or operator shall submit the following items to the executive director: (i) a letter signed by the owner's or operator's chief financial officer and worded as specified in forms approved by the executive director; and (ii) a copy of the independent certified public accountant's report on examination of the owner's or operator's financial statements for the latest completed fiscal year; and (iii) a special report from the owner's or operator's independent certified public accountant to the owner or operator stating that: (I) he has compared the data which the letter from the chief financial officer specifies as having been derived from the independently audited, year- end financial statements for the latest fiscal year with the amounts in such financial statements; and (II) in connection with that procedure, no matters came to his attention which caused him to believe that the specified data should be adjusted. (C) After the initial submission of items specified in subparagraph (B) of this paragraph, the owner or operator shall send updated information to the executive director within 90 days after the close of each succeeding fiscal year. This information shall consist of all three items specified in subparagraph (B) of this paragraph. (D) If the owner or operator no longer meets the requirements of subparagraph (A) of this paragraph, he shall send notice to the executive director of intent to establish alternate financial assurance as specified in this section. The notice shall be sent by certified mail within 90 days after the end of the fiscal year for which the year-end financial data show that the owner or operator no longer meets the requirements. The owner or operator shall provide the alternate financial assurance within 120 days after the end of such fiscal year. (E) The executive director may, based on a reasonable belief that the owner or operator may no longer meet the requirements of subparagraph (A) of this paragraph, require reports of financial condition at any time from the owner or operator in addition to those specified in subparagraph (B) of this paragraph. If the executive director finds, on the basis of such reports or other information, that the owner or operator no longer meets the requirements of subparagraph (A) of this paragraph, the owner or operator shall provide alternate financial assurance as specified in this section within 30 days after notification of such a finding. (F) The executive director may disallow use of this test on the basis of qualifications in the opinion expressed by the independent certified public accountant in his report on examination of the owner's or operator's financial statements. An adverse opinion or disclaimer of opinion will be cause for disallowance. The executive director will evaluate other qualifications on an individual basis. The owner or operator shall provide alternate financial assurance as specified in this section within 30 days after notification of the disallowance. (G) The owner or operator is no longer required to submit the items specified in subparagraph (B) of this paragraph when: (i) an owner or operator substitutes alternate financial assurance as specified in this section; or (ii) the executive director releases the owner or operator from the requirements of this section in accordance with sec.334.509(c) of this title (relating to Liability Requirements for Class A and Class B Facilities). (5) Guarantee for liability coverage. (A) An owner or operator may meet the requirements of this section by obtaining a written guarantee, hereafter referred to as "corporate guarantee." The guarantor shall be the direct or higher-tier parent corporation of the owner or operator, a firm whose parent corporation is also the parent corporation of the owner or operator, or a firm with a "substantial business relationship" with the owner or operator. The guarantee shall meet the requirements for owners or operators in paragraph (4) (A)-(G) of this section and shall comply with the terms of the corporate guarantee. (B) The wording of the corporate guarantee shall be on forms approved by the executive director. The corporate guarantee shall accompany the items sent to the executive director as specified in paragraph (4)(B) of this section. If the guarantor's parent corporation is also the parent corporation of the owner or operator, this letter shall describe the value received in consideration of the guarantee. If the guarantor is a firm with a "substantial business relationship" with the owner or operator, this letter shall describe this "substantial business relationship" an the value received in consideration of this corporate guarantee. The terms of the corporate guarantee shall provide the following. (i) If the owner or operator fails to satisfy a judgement based on a determination of liability for bodily injury or property damage to third parties caused by sudden or nonsudden accidental occurrences (or both as the case may be), arising from the operation of facilities covered by this corporate guarantee, or fails to pay an amount agreed to in settlement of claims arising from or alleged to arise from such injury or damage, the guarantor will do so up to the limits of coverage. (ii) If the owner or operator fails to provide alternate financial assurance as specified in this section and obtain the written approval of such alternate assurance from the executive director within 90 days after receipt by both the owner or operator and the executive director of a notice of cancellation of the corporate guarantee from the guarantor, the guarantor will provide such alternative financial assurance in the name of the owner or operator. (6) Insurance for liability coverage. (A) An owner or operator may satisfy the requirements of this section by obtaining insurance which conforms to the requirements of this paragraph and submitting a copy of the certificate or endorsement to the executive director. (B) Each policy shall be amended by attachment of the Petroleum-Substance Waste Facility Liability Endorsement or evidenced by a Certificate of Liability Insurance. The owner or operator shall submit a signed duplicate original of the endorsement or certificate of insurance to the executive director. If requested by the executive director, the owner or operator shall provide a signed duplicate original of the insurance policy. (C) The wording of the endorsement and the certificate of insurance shall be on forms approved by the executive director. (D) Each insurance policy shall be issued by an insurer that at a minimum, shall be chartered and licensed in at least one state and authorized to engage in the business of insurance. (7) Use of multiple financial mechanisms. An owner or operator may satisfy the requirements of this section by establishing more than one financial mechanism. The required liability coverage may be demonstrated through the use of combinations of insurance, financial test, guarantee, letter of credit, surety bond, and trust fund, except that the owner or operator may not combine a financial test covering part of the liability coverage requirement with a guarantee unless the financial statement of the owner or operator is not consolidated with the financial statement of the guarantor. The amounts of coverage demonstrated shall total at least the minimum amount required by this section. If the owner or operator demonstrates the required coverage through the use of a combination of financial assurances under this paragraph, the owner or operator shall specify at least one such assurance as "primary" coverage and shall specify other assurance as "excess". sec.334.510. Incapacity of Owners or Operators, Guarantors, or Financial Institutions. (a) An owner or operator shall notify the executive director by certified mail of the commencement of a voluntary or involuntary proceeding under Title 11 (Bankruptcy), United States Code, naming the owner or operator as debtor, within 10 business days after the commencement of the proceeding. A guarantor of a corporate guarantee as specified in sec.334.507(f) and sec.334.508(d)(5) of this title (relating to General Requirements for Financial Assurance and Liability Requirements for Class A and Class B Facilities) shall make such a notification if he is named as debtor, as required under the terms of the guarantee. (b) An owner or operator who fulfills the requirements of sec.334.507 or sec.334.508 of this title (relating to General Requirements for Financial Assurance; Mechanisms for Financial Assurance) by obtaining a letter of credit, surety bond, or insurance policy will be deemed to be without the required financial assurance or liability coverage in the event of bankruptcy, insolvency, or a suspension or revocation of the license or charter of the issuing institution. The owner or operator shall establish other financial assurance or liability coverage within 60 days after such an event. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317359 Mary Ruth Holder Legal Division Texas Water Commission Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 463-8069 Title 34. Public Finance Part I. Comptroller of Public Accounts Chapter 3. Tax Administration Subchapter V. Franchise Tax 34 TAC sec.3.572 The Comptroller of Public Accounts proposes an amendment to sec.3.572, concerning 1992 transition. The subsection concerning mergers, reorganizations, or transfers of assets occurring after August 13, 1991, and on or before December 31, 1991, has been deleted. Tom Plaut, chief revenue estimator, has determined that for the first five-year period the section is in effect there will be no significant revenue impact on the state or local government. Dr. Plaut also has determined that for each year of the first five years the section is in effect there would be no significant public cost or benefit. This section is adopted under the Tax Code, Title 2, and does not require a statement of fiscal implications for small businesses. There is no significant anticipated economic cost to persons who are required to comply with the proposed section. Comments on the proposal may be submitted to Charles C. Johnstone, Manager, Tax Administration Division, P.O. Box 13528, Austin, Texas 78711. The amendment is proposed under the Tax Code, sec.111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2. sec.3.572. 1992 Transition. (a) Definition. "Beginning date" means: (1) for a Texas corporation, the date the
                                                                                                                                                                            charter is effective
                                                                                                                                                                              [date]; and (2) for a foreign corporation, the earlier of: (A) the date the
                                                                                                                                                                                certificate of authority is effective
                                                                                                                                                                                  [date]; or (B) (No change.) [(b) Mergers, reorganizations, and transfers of assets. [(1) A corporation, including a limited liability company and a state or federal savings and loan association as provided in the Tax Code, sec.171. 001(a)(2), which is the surviving corporation in any merger, reorganization or transfer of assets occurring after August 13, 1991, and on or before December 31, 1991, will be subject to tax on the net taxable earned surplus of the nonsurviving corporation which is earned from the day after the date upon which the nonsurviving corporation's previous franchise tax report was based through the date of the merger, reorganization, or transfer of assets from the nonsurviving corporation to the surviving corporation if the principal purpose of the merger, reorganization, or transfer of assets was the evasion or avoidance of franchise tax. [(A) The provisions of this paragraph will not apply to a corporation which merged, reorganized, or transferred assets pursuant to a binding contract entered into prior to August 13, 1991. For these purposes, a contract is binding if it is in writing, fully executed, and legally enforceable. [(B) If the beginning date of the nonsurviving corporation is after October 3, 1990, and before December 31, 1991, the tax will be based on the net taxable earned surplus earned by the nonsurviving corporation from its beginning date through the date of the merger, reorganization, or transfer of assets to the surviving corporation. [(2) The phrase "evasion or avoidance" is not limited to cases involving criminal penalties, or civil penalties for fraud. Further, if the purpose to evade or avoid franchise tax exceeds in importance any other purpose, it will be considered to be the principal purpose. The determination of the principal purpose of a merger, reorganization, or transfer of assets will be based upon the facts and circumstances of the entire transaction, including any series of steps in the course of conduct of the surviving and nonsurviving corporations which are interrelated. Transactions which are determined to have been undertaken for the principal purpose of evasion or avoidance of franchise tax will be disregarded as shams. [(3) Facts and circumstances which will, in the absence of additional evidence to the contrary, indicate that the principal purpose of the merger, reorganization, or transfer of assets was the evasion or avoidance of franchise tax will include, but not be limited to, the following: [(A) mere change in identity, form or place of organization of the nonsurviving corporation, however effected; or [(B) continuation by the surviving corporation immediately following the merger, reorganization, or transfer of assets of: [(i) substantially the same trade or business in this state as conducted by the nonsurviving corporation immediately prior to the merger, reorganization, or transfer of assets; and [(ii) substantially the same ownership of the stock or assets of the nonsurviving corporation as that owned immediately prior to the merger, reorganization or transfer of assets. [(4) In determining whether a corporation has continued to carry on a trade or business substantially the same as that conducted before the merger, reorganization, or transfer of assets, all the facts and circumstances of the transactions occurring between the nonsurviving corporation and the surviving corporation and any affiliated entities of either involved in the transactions will be taken into account. Among the relevant factors to be taken into account will be changes in the corporation's employees, plant, equipment, product, location, customers, and any other items that are significant in determining whether there has been a continuation of the trade or business of the nonsurviving corporation. [(5) In determining whether a continuation of ownership has occurred, all the facts and circumstances of the transactions occurring between the shareholders of the nonsurviving corporation and the surviving corporation or its shareholders and any affiliated entities or the shareholders of affiliated entities involved in the transactions will be taken into account. A continuation of ownership will be deemed to have occurred only if immediately following the merger, reorganization, or transfer of assets, the surviving corporation owns, directly or indirectly, 80% or more in value of the stock or assets previously held by the nonsurviving corporation immediately prior to the merger, reorganization, or transfer of assets. The constructive ownership rules of the Internal Revenue Code of 1986, 318, as amended, will be applied in determining whether stock is owned directly or indirectly by a shareholder, except that the references to 50% in the Internal Revenue Code, sec.318(a)(2)(C) and (3)(C), will be read as 80%. [(6) The tax due from the surviving corporation in a merger, reorganization, or transfer of assets under paragraph (1) of this subsection is due May 15, 1992, on a form specified by the comptroller. If the amount of tax due is less than $100, no tax will be due. The tax will be due from the surviving corporation as though no merger, reorganization, or transfer of assets had occurred. For example, if an existing regular annual reporting corporation with a December 31 year end was merged into a new corporation on December 1, 1991, the new corporation would be required to file a regular franchise tax report on May 15, 1992, which would reflect all taxable capital of the surviving corporation as of December 31, 1991, and the taxable earned surplus of the nonsurviving corporation from January 1, 1991, through December 1, 1991, combined with the taxable earned surplus of the surviving corporation from December 1, 1991, through December 31, 1991. [(7) The surviving corporation of a merger, reorganization, or transfer of assets which was not undertaken for the principal purpose of evasion or avoidance of franchise tax may file a disclosure statement on or before May 15, 1992, on a form specified by the comptroller. A surviving corporation which files a disclosure statement no later than May 15, 1992, will not be required to file a regular annual report on May 15, 1992. No penalties will accrue on any franchise tax liability finally determined if a disclosure statement is timely filed under this paragraph. On or before July 1, 1992, the comptroller will notify each surviving corporation which has filed a disclosure statement of whether the transaction has been determined to have been undertaken for the principal purpose of evasion or avoidance of franchise tax. [(A) If the early determination of the comptroller is that the principal purpose of the transaction was not the evasion or avoidance of franchise tax, the nonsurviving corporation will not be liable for franchise tax for the franchise tax year 1992 and, unless a redetermination based on fraud or misrepresentation of fact is made by the comptroller, the surviving corporation will not be liable for any franchise tax liability based on the earned surplus of the nonsurviving corporation other than as a transferee. [(B) If the early determination of the comptroller is that the principal purpose of the transaction was the evasion or avoidance of tax, by August 1, 1992, the surviving corporation must either: [(i) file the franchise tax annual report in the manner described in paragraph (6) of this subsection; or [(ii) submit to the comptroller such additional information as it deems necessary or appropriate concerning the facts and circumstances of the transactions between the surviving corporation and the nonsurviving corporation and all affiliated entities. Penalties will be assessed on all franchise tax due under subparagraph (B) of this paragraph after August 1, 1992, unless additional information is submitted by August 1, 1992. [(C) All early determination notices issued by the comptroller will be subject to change upon audit in the event of fraud or misrepresentation of fact in the information submitted to the comptroller in the disclosure statement or any additional information submitted to the comptroller in connection with issuing the early determination.] (b)
                                                                                                                                                                                    [(c)] Shortened privilege periods. All second and regular annual privilege periods which would have ended April 30, 1992, except for changes made by the legislature during 1991, will now end December 31, 1991. (c)
                                                                                                                                                                                      [(d)] Tax rates. (1) The tax rate for the regular annual privilege period beginning May 1, 1991, and ending December 31, 1991, will be $5.25 for each $1,000 or fraction of $1,000 of taxable capital allocated to this state. (2) The tax rate for corporations with a beginning date after April 30, 1990, but before October 4, 1990, will be $5.25 for each $1,000 or fraction of $1,000 of taxable capital allocated to this state per year of privilege period. (3) The
                                                                                                                                                                                        [Except for a corporation which is the nonsurvivor of a merger, reorganization, or transfer of assets occurring after August 13, 1991, and before January 1, 1992, the] tax rate for corporations with a beginning date after October 3, 1990, is 0.25% per year of privilege period of net taxable capital and 4.5% of net taxable earned surplus for the entire initial report. (4) The
                                                                                                                                                                                          [In addition to the supplemental tax provided for in this rule, the] tax rate for a corporation with a beginning date after October 3, 1990, which ceases to exist before January 1, 1992, will be $5.25 for each $1,000 or fraction of $1,000 of taxable capital allocated to this state per year of privilege period. (d)
                                                                                                                                                                                            [(e)] Loss of nexus before end of privilege period. If a corporation has nexus for one day of a privilege period, it must pay for the entire privilege period. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 20, 1993. TRD-9317924 Martin Cherry Chief, General Law Section Comptroller of Public Accounts Earliest possible date of adoption: March 1, 1993 For further information, please call: (512) 463-4028 TITLE 37. PUBLIC SAFETY AND CORRECTIONS Part VI. Texas Department of Criminal Justice Chapter 163. Standards Subchapter B. Local Departments 37 TAC sec.163.29 (Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the Texas Department of Criminal Justice or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.) The Texas Department of Criminal Justice-Community Justice Assistance Division (TDCJ-CJAD) proposes the repeal of sec.163.29, concerning community justice councils. Section 163.29, Community Justice Councils, is being repealed and revised in its entirety. It has been resubmitted for proposed adoption under sec.163.23 of this chapter. Bob Young, Director, Austin Budget Office, TDCJ Finance Administration Division, has determined that there will be no fiscal implications resulting from this proposed repeal and recodification process. Mr. Young determined that, regarding the public benefit and cost, this repeal represents an effort to consolidate, reorganize, and clarify current sections on existing statutory programs. Mr. Young also determined that the repeal of this section will not have any fiscal implications over those currently required in existing provisions. As a result, there should not be any additional cost imposed on state or local governments over the next five years and being the section concern only requirements placed on local governments, councils and community supervision and corrections departments, there should be no effect on small businesses. Also, it is not anticipated that any increase in economic cost to persons will occur as a result of this repeal. Comments on the proposed action may be submitted to Nancy Bartlett, Director of Program Audits and Operations, at 8100 Cameron Road, B-450, Austin, Texas 78753. Written comments should be submitted within 30 days after the date of the publication of this action in the Texas Register. The repeal is proposed under the Code of Criminal Procedures, Article 42.13, sec.2(a) and sec.3(a), which provides the TDCJ-CJAD with the authority to establish minimum standards for programs, facilities, equipment, and other aspects of the operation of departments; establish an application process and procedures for funding community corrections facilities; establish a format for community justice plans; and to require community supervision and corrections departments to keep financial and statistical records; submit a community justice plan; and submit periodic financial audits and statistical reports to TDCJ-CJAD. sec.163.29. Community Justice Councils. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 18, 1993. TRD-9317967 Jackee Cox General Counsel Texas Department of Criminal Justice Proposed date of adoption: March 1, 1993 For further information, please call: (512) 463-9988 Subchapter C. Programs and Services 37 TAC sec.163.55 (Editor's Note: The Texas Department of Criminal Justice proposes for permanent adoption the repeal section it adopts on an emergency basis in this issue. The text of the repeal section is in the Emergency Rules section of this issue.) The Texas Department of Criminal Justice-Community Justice Assistance Division (TDCJ-CJAD) proposes the repeal of sec.163.55, concerning residential services. Section 163.55, Residential Services, is being repealed and revised in its entirety. It has been resubmitted for proposed adoption under sec.163.39 of this chapter. Bob Young, Director, Austin Budget Office, TDCJ Finance Administration Division, has determined that for the first five-year period the repeal is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the repeal. Mr. Young also has determined that for each year of the first five years the repeal is in effect the public benefit anticipated as a result of enforcing the repeal will be an effort to consolidate, reorganize, and clarify current sections on existing statutory programs. Mr. Young also determined that the repeal of this section will not have any fiscal implications over those currently required in existing provisions. As a result, there should not be any additional cost imposed on state or local governments over the next five years and being the section concerns only requirements placed on local governments, councils, and community supervision and corrections departments, there should be no effect on small businesses. Also, it is not anticipated that any increase in economic costs to persons will occur as a result of this repeal. Comments on the proposed action may be submitted to Nancy Bartlett, Director of Program Audits and Operations, at 8100 Cameron Road, B-450, Austin, Texas 78753. Written comments should be submitted within 30 days after the date of the publication of this action in the Texas Register. The repeal is proposed under Vernon's Annotated Code of Criminal Procedures, Article 42.13, sec.2(a) and sec.3(a), which provides the TDCJ-CJAD with the authority to establish minimum standards for programs, facilities, equipment, and other aspects of the operation of departments; establish an application process and procedures for funding community corrections facilities; establish a format for community justice plans; and to require community supervision and corrections departments to keep financial and statistical records; submit a community justice plan; and submit periodic financial audits and statistical reports to TDCJ-CJAD. sec.163.55. Residential Services. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 21, 1993. TRD-9318103 Jackee Cox General Counsel Texas Department of Criminal Justice Proposed date of adoption: April 13, 1993 For further information, please call: (512) 463-9988 Chapter 325. Agency Procedures 37 TAC sec.sec.325.1-325.5, 325.7-325.11 (Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Texas Department of Criminal Justice or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.) The Texas Department of Criminal Justice-Community Justice Assistance Division (TDCJ-CJAD) proposes the repeal of sec. s325.1-325.5 and sec.sec.325.7-325. 11, concerning the agency procedures of the Texas Adult Probation Commission. The sections are being repealed as part of the recodification process required by the reorganization of the Texas Department of Criminal Justice (TDCJ) under which the Texas Adult Probation Commission (TAPC) became the TDCJ-CJAD. Bob Young, Director, Austin Budget Office, TDCJ Finance Administration Division, has determined that for the first five-year period the repeals are in effect there will be no fiscal implications resulting from these proposed repeals and recodification process. Mr. Young determined that, regarding the public benefit and cost, the repeals represent an effort to consolidate, reorganize, and clarify current sections on existing statutory programs. Mr. Young also determined that the repeals of these sections will not have any fiscal implications over those currently required in existing provisions. As a result, there should not be any additional cost imposed on state or local governments over the next five years and being the sections concern only requirements placed on local governments, councils, and community supervision and corrections departments, there should be no effect on small businesses. Also, it is not anticipated that any increase in economic costs to persons will occur as a result of these repeals. Comments on this proposed action may be submitted to Nancy Bartlett, Director of Program Audits and Operations, at 8100 Cameron Road, B-450, Austin, Texas 78753. Written comments should be submitted within 30 days after the date of the publication of this action in the Texas Register. The repeals are proposed under the Code of Criminal Procedures, Article 42. 13, sec.2(a) and sec.3(a), which provides the TDCJ-CJAD with the authority to establish minimum standards for programs, facilities, equipment, and other aspects of the operation of departments; establish an application process and procedures for funding community corrections facilities; establish a format for community justice plans; and to require community supervision and corrections departments to keep financial and statistical records; submit a community justice plan; and submit periodic financial audits and statistical reports to TDCJ-CJAD. sec.325.1. Texas Adult Probation Commission. sec.325.2. Meetings. sec.325.3. Committees. sec.325.4. Division of Responsibilities. sec.325.5. Delegation of Authority. sec.325.7. Executive Director, Employees. sec.325.8. Public Information. sec.325.9. Complaints. sec.325.10. Annual Reports. sec.325.11. Intergovernmental Cooperation. This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority to adopt. Issued in Austin, Texas, on January 22, 1993. TRD-9318104 Jackee Cox General Counsel Texas Department of Criminal Justice Proposed date of adoption: April 13, 1993 For further information, please call: (512) 463-9988