ADOPTED 
 RULES 
 
 An agency may take final action on a section 30 days after a proposal has been 
published in the  Texas Register. The section becomes effective 20 days after 
the agency files the correct document with the  Texas Register, unless a later 
date is specified or unless a federal statute or regulation requires 
implementation of the action on shorter notice. 
 If an agency adopts the section without any changes to the proposed text, only 
the preamble of the notice and statement of legal authority will be published. 
If an agency adopts the section with changes to the proposed text, the proposal 
will be republished with the changes. 
 
   
  TITLE 1. ADMINISTRATION 
 Part I. Office of the Governor 
  Chapter 4. Automobile Theft Prevention Authority 
  
  1 TAC sec.4.36 
 
  The Automobile Theft Prevention Authority (ATPA) adopts an amendment to 
sec.4.36, concerning the administration of the (ATPA) program, with changes to 
the proposed text as published in the April 11, 1995, issue of the Texas 
Register  (20 TexReg 2689). 
 The amendment is necessary to ensure that the applicants for funds have 
complete information concerning the level of funding for grant projects. 
 The amendment adopts a level of funding for projects receiving ATPA funding and 
establishes ratios of maximum ATPA funds and minimum local cash and/or in-kind 
contributions from grantees. 
 The ATPA received written and oral comments on the amendment from the Galveston 
County Auto Crimes Task Force. A summary of those comments is as follows. 
 (1) ATPA funding should be at 80% of the total costs of the funded project, 
rather than at 80% of the previous ATPA grant award. As an alternative, ATPA 
should fund salaries at 100% of costs with a 5% cost-of-living increase and 
other costs at 80%. The ATPA disagrees with these comments in that such an 
approach would be inconsistent with the intent of ATPA's grants program which is 
to provide initial funding for automobile theft prevention programs and to 
allocate ATPA funds to those areas that do not have existing programs. The 
ATPA's decision to fund third-year programs at 80% of the previous year's grant 
amount makes those funds available for other projects. 
 (2) The ATPA should not award inefficiencies in estimating costs by allowing 
grantees to utilize money that is left over from the fiscal year 1995 grants. 
The ATPA agrees with this comment and has deleted that provision from its 
proposed rules. 
 The amendment is adopted under Texas Civil Statutes, Article 4413(37), 
sec.6(a), which authorizes the Automobile Theft Prevention Authority to adopt 
rules to implement its powers and duties. 
 Texas Civil Statutes, Article 4413(37) is affected by this adoption. 
 
 
  sec.4.36. Level of Funding for Grant Projects. 
 
  (a) The level of funding for projects receiving ATPA funding will be at the 
following ratios of maximum ATPA funds and minimum local cash and/or in-kind 
contributions (ATPA-funded indirect costs excluded): 
     
  Local 
   
  ATPA Funds Contribution 
   
  Year (maximum) (minimum) 
   
  First 100% 0% 
   
  Second 100% 0% 
   
  Third 80% 20% 
   
  Fourth 60% 40% 
   
  Fifth 60% 40% 
 
  (b)-(c) No change. 
   
  (d) For Fiscal Year 1996 only: 
 
  (1) Grantees who are in their 80% ATPA funding year may either apply for 80% 
of the Fiscal Year 1995 funds without match, or provide documentation for 20% of 
cash and/or in-kind contribution match, if the grantee chooses to show its local 
contribution to the grant program. 
   
  (2) Cash and/or in-kind contributions which have been previously documented 
and submitted to ATPA can be accrued for credit for the respective grantee, for 
the sole purpose of satisfying the 20% match, if the grantee chooses to show its 
local contribution to the grant program. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on September 22, 1995. 
 TRD-9512196 
  Linda Young 
 Executive Director 
 Texas Department of Transportation 
    Effective date: October 13, 1995 
 Proposal publication date: April 11, 1995 
 For further information, please call: (512) 467-3999 
         
                 Part IV. Office of the Secretary of State 
  Chapter 105. Solicitations 
  
  Subchapter C. Telephone Solicitations 
 
  1 TAC sec.sec.105.201, 105.204-105.207 
 
  The Office of the Secretary of State adopts new sec.105.201 and sec.sec.105. 
204-105.207, without changes to the proposed text as published in the August 18, 
1995, issue of the Texas Register (20 TexReg 6291). 
 These rules are adopted to increase filing efficiency and the payment of claims 
in the administration of the Texas Telephone Solicitation Act. 
 No comments were received regarding adoption of the rules. 
 The rules are adopted under the authority of the Telephone Solicitation Act, 
Texas Civil Statutes, Article 5069-18.01, et seq (Vernon Supplement 1995), which 
requires the Secretary of State to accept registrations filed under the Act. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on September 20, 1995. 
 TRD-9512261 
  Clark Kent Ervin 
 Assistant Secretary of State 
 Office of the Secretary of State 
    Effective date: October 16, 1995 
 Proposal publication date: August 18, 1995 
 For further information, please call: (512) 463-5702 
         
               
  TITLE 4. AGRICULTURE 
 Part II. Texas Animal Health Commission 
  
  Chapter 35. Brucellosis 
 Subchapter A. Eradication of Brucellosis in Cattle 
   
  
  4 TAC sec.sec.35.1, 35.2, 35.4, 35.6, 35.7 
 
  The Texas Animal Health Commission adopts amendments to  sec.sec.35.1, 35.2, 
35.4, 35.6, and 35.7, concerning the implementation of the Brucellosis Free 
Planning Project recommendations, with changes to the proposed text as published 
in the July 28, 1995, issue of the Texas Register (20 TexReg 5556). 
 The amended rules are necessary for establishing categories of and testing 
requirements for test-eligible cattle; allowing reactor animals to be permitted 
to market only if approved by the Executive Director; setting requirements for 
quarantine release; clarifying responsibility for change of ownership testing; 
requiring testing prior to movement to Mexico for slaughter; requiring retest of 
units not depopulated after indemnity payment, and allowing indemnity for Strain 
19 reactors. 
 Two comments were received regarding adoption of the amendments. First, the 
Texas Cattle Feeders Association noted that the language in sec.35.2(r)(4) 
should be clarified to state that cattle destined for designated pens may not be 
held in common receiving areas, and that sec.35.2(r)(7) should have the 
requirement of individual identification for interstate movement removed to 
conform with federal requirements. The Commission agrees with this comment and 
the regulation is adopted with these changes. Second, the Livestock Marketing 
Association noted that the requirement in sec.35.2(j) that reactor cattle may 
only be sold to slaughter through a livestock market if approved by an 
epidemiologist is too onerous for the producer. The Commission agrees with this 
comment and adopts the regulation with the requirement that these animals must 
move direct to slaughter if the Executive Director determines there is a 
significant risk of spread of brucellosis. Finally, the Commission adopted the 
changes to sec.35.4(d) with the clarification that steers, spayed heifers, and 
feedlot finished bulls and heifers are not required to be tested prior to export 
to Mexico. 
 The amendments are adopted under the Texas Agriculture Code, Texas Civil 
Statutes, sec.163.061, which provide the Commission with the authority to adopt 
rules regarding testing, vaccination, and movement. 
 The amendments implement the Agriculture Code, sec.sec.163.002, 163.064, 163. 
065, 163.066, 163.068, and 163.069, which provides the Commission with the 
authority to regulate and require vaccination, testing, handling of infected 
animals, and movement; to pay indemnity; and to establish herd plans. 
 
 
  sec.35.1. Definitions.  The following words and terms, when used in this 
chapter, shall have the following meanings, unless the context clearly indicates 
otherwise. 
   
     Designated Pens -A set of pens in a feedlot under a plan of restricted 
movement, approved jointly by Animal and Plant Health Inspection Service, 
Veterinary Services, and the Commission in which all cattle are classified as 
exposed to brucellosis. The pens may be pre-approved, but the approval period 
will begin with initial arrival of the exposed cattle. The Designation will be 
automatically renewed every 12 months if requirements specified in these 
regulations and the approved agreement continue to be met by the feedlot. The 
status will continue until: 
 
  (A) the feedlot requests deactivation; or 
   
  (B) the Commission determines the status should be eliminated because of the 
feedlot's failure to comply with the Designation Agreement or these regulations; 
or 
   
  (C) changes in Federal or State law or regulations require elimination of or 
change in the status. 
     
     Official Vaccinate - 
 
  (A) Calfhood Vaccinate: Female cattle (dairy and beef) vaccinated between four 
and ten months of age with an approved Brucella vaccine. 
   
  (B) Adult Vaccinate: Female cattle that have been blood tested negative within 
ten days prior to vaccination and vaccinated at an age over the ages given in 
subparagraph (A) of this paragraph with an approved dose of Brucella vaccine as 
part of a whole herd vaccination plan. 
     
     Priority Herd-Exposed herd from which a reactor has been classified, 
infected herd, or adjacent herd. 
   
     Test Eligible Cattle in Priority Herds -All non-vaccinated female cattle 
four months of age and older, and all cattle designated as test eligible in 
herds other than priority herds. 
   
     Test-Eligible Cattle in other than Priority Herds-All cattle 18 months of 
age and over (as evidenced by the loss of the first pair of temporary incisor 
teeth), except steers, spayed heifers, official calfhood vaccinates of dairy 
breeds under 20 months of age, and official calfhood vaccinates of beef breeds 
under 24 months of age (24 months of age as evidenced by the first pair of fully 
erupted permanent incisor teeth). Official calfhood vaccinates that are 
parturient (springers) or postparturient are test-eligible regardless of age. 
 
   
  sec.35.2. General Requirements. 
 
  (a)-(c) (No change.) 
   
  (d) Requirements for a herd test. 
 
  (1) Test eligibility. 
 
  (A) Priority herds . 
 
  (i) All non-vaccinated female cattle four months of age and older; and 
   
  (ii) All cattle designated as test-eligible in other than priority herds. 
     
  (B) Other than priority herds-All non-exempt cattle 18 months of age and older 
except steers, spayed heifers, official vaccinates of dairy breeds under 20 
months of age, and official calfhood vaccinates of beef breeds under 24 months 
of age. Official calfhood vaccinates that are parturient or post parturient are 
test-eligible regardless of age. 
     
  (2) Calfhood vaccination requirements. All female cattle between four and ten 
months of age in priority herds must be vaccinated at the time of testing. 
   
  (3) Identification requirements. All cattle tested shall be identified with 
either an official eartag, an individual registration tattoo, or individual 
registration brand. All cattle in priority herds except steers, spayed heifers, 
and bulls under 18 months of age must be officially identified regardless of 
test eligibility. 
     
  (e) Requirements of a market test. 
 
  (1)-(6) (No change.) 
   
  (7) Cattle which show a positive reaction to the card test shall have another 
blood sample collected from them by an inspector. The inspector will conduct 
another card test and the CITE test or deliver the sample to a laboratory for a 
PCFIA test. If negative to the CITE or PCFIA tests the officially vaccinated 
cattle shall be classified negative for intrastate movement only and marked on 
the hip with yellow paint. If negative to the CITE or PCFIA tests, the 
nonvaccinated cattle shall be classified as suspect(s) and may be permitted to 
return to the premises of origin under hold order for retest or be "S"-branded 
and permitted to slaughter or to a quarantined feedlot or designated pen. The 
remainder of the consignment may move unrestricted. Samples tested with the CITE 
test shall then be submitted to a state/federal laboratory in a vacutainer for 
supplemental testing and accompanied by a completed Form 91-28 which lists only 
the card positive cattle. 
     
  (f)-(g) (No change.) 
   
  (h) Identification of brucellosis affected cattle. 
 
  (1) (No change.) 
   
  (2) Exposed Cattle. All exposed cattle moving to a quarantined feedlot, 
designated pen, quarantined pasture, or to slaughter shall be identified by 
branding with a hot iron the letter "S" (at least 2 x 2 inches) placed on the 
left jaw, or high on the tailhead so as to be visible from ground level. 
Identification shall be prior to movement, except exposed cattle on the premise 
of origin may be "S" permitted to a livestock market where they shall be 
identified by "S" brand upon arrival. Exposed cattle returned from the livestock 
market to the herd of origin are exempt from such identification. 
   
  (3) Suspects. Cattle classified as suspects in markets will be identified as 
exposed cattle. 
     
  (i) Movement of cattle classified as reactors, exposed or suspects. There 
shall be no diversion from the permitted destination. When moved, the cattle 
must be maintained separate and apart from all other classes of livestock in 
designated pens reserved for this purpose at livestock markets or trucking 
facilities. These pens must be thoroughly cleaned and disinfected before reuse. 
 
  (1) (No change.) 
   
  (2) Exposed cattle. All exposed cattle moving from a premise of origin or from 
a livestock market to a quarantined pasture, designated pen, quarantined 
feedlot, or to immediate slaughter shall remain on the premise where disclosed 
until an "S" permit VS Form 1-27 for movement has been prepared by a TAHC 
Representative and signed by the person or other legal entity moving the cattle. 
The completed "S" permit shall accompany the shipment of cattle to the permitted 
destination. Movement for immediate slaughter must be to a slaughtering 
establishment where Federal or State meat inspection is maintained or to a 
livestock market for sale to such slaughtering facility. 
   
  (3) Suspects. Suspects will be moved the same as exposed cattle, except a 
vaccinated suspect(s) at a livestock market in a consignment of otherwise 
negative cattle, (where the suspect is card positive on the presumptive test and 
negative to the CF or Rivanol Test(s)) may move as follows: In a single 
consignment of cattle, which are from a producer's herd of origin, the owner 
shall either return the vaccinated suspect(s) under quarantine to the herd of 
origin until the suspect(s) is negative to the card test, declared a stabilized 
suspect by an epidemiologist after subsequent test(s) conducted in not less than 
30 days, or classified as a reactor on a subsequent test; or sell the suspect(s) 
to a quarantined feedlot, designated pen, quarantined pasture, or to slaughter, 
identified with an "S" brand. Card negative cattle in this consignment may 
return to the herd of origin or move to another premise within the State or move 
interstate. Consignments containing a card positive but CF or Rivanol negative 
nonvaccinated suspect(s) shall be identified and moved as exposed cattle or 
returned to the premises of origin under quarantine. 
     
  (j) Immediate slaughter of reactors. Reactor cattle shall be sold for 
immediate slaughter and removed from the premise under "B" permit within 15 days 
from the date of identification for beef cattle and within seven days from the 
date of identification for dairy cattle. Movement for immediate slaughter shall 
be to a slaughtering establishment where Federal or State inspection is 
maintained or to a livestock market for sale to such a slaughtering 
establishment. When it has been determined by the Executive Director that a 
specific reactor or reactors present a significant risk of spread of 
brucellosis, those specific animals must move direct to slaughter and may not be 
moved to a livestock market. 
   
  (k) Removal of heifer calves from quarantined herds. Heifers born in an 
infected herd shall be removed from the herd immediately after they are weaned 
and moved to a market, quarantined pasture, designated pen, quarantined feedlot, 
or slaughter or kept as a separate heifer herd under quarantine. 
   
  (l) Requirements following classification of a dairy or a beef animal or a 
bison as a reactor or a suspect. 
 
  (1)-(2) (No change.) 
   
  (3) An initial test of the herd which contained the reactor(s) or the 
suspect(s) and/or any other affected, adjacent or high risk herds will be 
conducted in accordance with subsection (d) of this chapter within a specified 
time set by state-federal personnel upon consultation with each herd owner 
unless waived by epidemiologist. If the Executive Director determines, based on 
epidemiological principles, that immediate action is necessary, the time for 
testing may be set without consultation with the herd owner. 
   
  (4) The results of the initial herd test of the herd which contained the 
reactor(s) or the suspect(s) and/or any other affected, adjacent or high risk 
herds will be used to determine the need for, and development of, an individual 
herd plan for prevention or elimination of brucellosis in that herd. The plan 
shall be developed by a State-Federal veterinarian of the brucellosis control 
program in consultation with the herd owner or caretaker and his veterinarian 
(if so requested by the owner). The plan developed by the Commission shall be 
final and the owner or caretaker will be provided a copy. Any proposed herd plan 
which has identified special management requirements will be reviewed by a 
State-Federal epidemiologist who will either support or modify the plan. A 
regional epidemiologist may waive vaccinating cattle over eight months of age in 
infected herds. The terms and conditions of a herd plan may be amended in 
writing by the Commission upon good cause. 
   
  (5) The plan will consist of the following: 
 
  (A) Testing Procedures. 
 
  (i) all eligible cattle in the herd including all nonvaccinated heifers over 
four months of age shall be presented for testing or retesting at intervals 
stated in the herd plan until the quarantine is released. 
   
  (ii)-(v) (No change.) 
     
  (B) Vaccination Procedures. 
 
  (i)-(iii) (No change.) 
   
  (iv) previously vaccinated negative female cattle shall be presented for 
revaccination with Strain 19, B. abortus vaccine as determined by the 
epidemiologist. 
       
  (6) (No change.) 
   
  (7) Requirements for Quarantine Release. 
 
  (A) A herd is eligible for quarantine release following a minimum of three 
consecutive herd blood tests that are classified as negative. The first negative 
test shall be conducted at least 30 days after the last reactor is removed from 
the herd. The second negative test shall be conducted at least 120 days after 
the last reactor is removed from the herd. The third negative test shall be 
conducted a minimum of 12 months after the last reactor is removed from the 
herd. 
   
  (B) Heifers born in the herd and were removed from the herd and kept 
separately shall remain under quarantine until they test negative 30 days 
following calving. 
   
  (C) On the releasing test, official vaccinates that react demonstrate suspect 
titers on the approved supplemental test shall be classified as suspects. After 
suspects are stabilized, the remainder of the herd may be released from 
quarantine. These suspects shall remain under a hold order. 
   
  (D) To obtain a quarantine release, the owner/caretaker shall retest all test-
eligible cattle in units not under quarantine. The retest must be conducted not 
less than six months after the removal of the last reactor from the quarantined 
unit. This retest, together with the third negative test of the quarantined 
unit, may be used for herd certification if conducted no more than 14 months 
following a negative herd test after the removal of the last reactor. A 
designated brucellosis epidemiologist may exempt units from these retest 
requirements. 
   
  (E) Epidemiological data may be considered in the release of the quarantine. 
       
  (m) (No change.) 
   
  (n) Community notification of infected herds. 
 
  (1) The status of infected herds and the application of quarantined feedlots, 
designated pens, and quarantined pastures are to be made known to herd owners in 
the immediate community. Notification of such herd owners may be achieved by 
means of an educational letter delivered through personal contact or by mail. 
When the herd has completed its individual herd plan, or the Quarantined Premise 
approval is terminated, the herd owners shall also be notified within 30 days by 
means of an educational letter delivered by personal contact or by mail. 
   
  (2) (No change.) 
     
  (o) Requirements for a quarantined feedlot. All parturient and postparturient 
cattle must be officially tested for brucellosis within 30 days prior to entry 
into a quarantined feedlot. All cattle except steers and spayed heifers in a 
quarantined feedlot shall be classified as exposed to brucellosis. The 
quarantined feedlot shall be maintained for finish feeding of cattle in drylot 
with no provisions for pasturing or grazing except in adjacent quarantined 
pastures. Negative exposed and untested test-eligible cattle must be permanently 
identified with a hot iron "S" brand either on the left jaw or high on the 
tailhead upon entering the quarantined feedlot. All cattle except steers and 
spayed heifers located in feedlots adjacent to quarantined pastures must be 
permanently identified with a hot iron "S" brand either on the left jaw or high 
on the tailhead upon entering such feedlots. All cattle except steers and spayed 
heifers leaving such feedlot must go directly to slaughter; or may be moved 
directly to another quarantined feedlot or designated pen with an "S" permit; or 
may be "S"-branded at the feedlot and move to a market to be sold for movement 
with an "S" permit issued at the market directly to another quarantined feedlot, 
to designated pens or directly to slaughter. 
   
  (p) Requirements of a quarantined pasture for "S"-branded heifers. The 
Commission in conjunction with the United States Department of Agriculture 
(USDA), Animal and Plant Health Inspection Services (APHIS), Veterinary Services 
(VS) may issue an approval to a landowner or operator to operate a quarantined 
pasture for a period not to exceed eight months, which approval is personal to 
the person named, and nontransferable to any other premises from the premises 
described in the approval. To be considered, an applicant must submit a 
completed application in writing to the Texas Animal Health Commission. 
Hereafter, the word "operator" is used to indicate the person who received the 
approval to operate a quarantined pasture. 
 
  (1)-(3) (No change.) 
   
  (4) The operator shall obtain an "S" brand permit for all heifers prior to 
their leaving the quarantined pasture and shall be responsible for their moving 
either: 
 
  (A) to a market to be sold for movement directly to slaughter or to a 
quarantined feedlot or designated pen; or 
   
  (B) (No change.) 
   
  (C) directly to a quarantined feedlot or designated pen. 
     
  (5) (No change.) 
   
  (6) An applicant denied approval may reapply any time upon a substantial 
change in circumstances. 
     
  (q) Market cattle identification. All test-eligible cattle which are being 
moved from markets to slaughtering establishments shall be identified by a USDA 
approved backtag placed just below the midline and just behind the shoulder of 
the animal. The check-in document will identify each backtagged animal to the 
consignor. 
   
  (r) Requirements for Designated Pens. Cattle exposed to brucellosis may be 
moved into designated pens in feedlots provided they meet the following 
requirements: 
 
  (1) The designated pens shall be maintained for finish feeding of cattle in 
dry lot with no provisions for pasturing or grazing. 
   
  (2) Double cattle-proof fences shall separate the designated pens from the 
remainder of the feedlot with at least 12 feet of space between the fences where 
cattle are not maintained. An alley may satisfy this separation requirement as 
long as neither food nor water is available and cattle are not maintained in the 
alley. 
   
  (3) All parturient and post parturient cattle must be officially tested 
negative for brucellosis within 30 days prior to entry into designated pens, 
classified as exposed to brucellosis and handled as specified in this section. 
   
  (4) Cattle going to designated pens will be unloaded and moved directly into 
those pens, and not held in common receiving areas used for cattle not destined 
for designated pens. 
   
  (5) All cattle must be permanently identified with a hot iron "S" brand either 
on the left jaw or high on the tailhead upon entering the designated pens. 
   
  (6) Cattle fed in designated pens may be processed or treated in common 
processing, sick, or hospital areas if the common area is cleaned and 
disinfected with an approved disinfectant after each use for these cattle and 
prior to use by cattle not from designated pens. If separate facilities are used 
for cattle from designated pens, cleaning and disinfecting are not necessary. 
   
  (7) All cattle leaving such designated pens must go directly to slaughter 
accompanied by a VS 1-27 permit. 
   
  (8) Detailed records of all cattle entering and leaving the designated pens, 
including dates and numbers of cattle, must be maintained by the feedlot for 
inspection by Commission representatives. 
   
  (9) If designated pen status is eliminated or deactivated, either on the 
feedlot's request or on determination by the Commission, the designated pen 
status will be removed after the need for cleaning and disinfecting of the 
designated pens is evaluated. 
     
  (s) Entering premises. Representatives engaged in the Brucellosis Control 
Program are authorized to enter into any property for the exercise of any 
authority or the performance of any duties authorized in this regulation and 
shall practice such sanitary procedures so as to minimize the risk of physically 
transmitting the disease to other premises. Owners and caretakers owning or 
having charge of cattle shall gather their cattle and furnish necessary labor in 
drawing blood or milk samples, vaccinating and identifying animals. 
   
  (t) Requirements for cleaning and disinfecting. 
 
  (1) Dairy. When reactors are disclosed in cattle which use the same facilities 
daily, those facilities will be cleaned and disinfected under the supervision of 
Approved Personnel upon removal of infected animals. 
   
  (2) Beef. As determined by Approved Personnel under individual herd plan 
following removal of reactor animals. 
     
  (u) Requirements on dealer recordkeeping. Any dealer must maintain records of 
cattle that are parturient or postparturient or 18 months of age or older. Such 
records shall show the buyers's and seller's name and address, county of origin, 
number of animals, and a description of each animal, including sex, age, color, 
breed, brand, and individual identification such as eartag, bangle tag, backtag, 
tattoo or firebrand. Records at auctions and commission firms shall show the 
delivery vehicle license number. All dealer records must be maintained for a 
minimum of two years after the date of the transaction. 
   
  (v) Brucellosis advisory committees. There may be one or more committees of 
cattle owners in the state, appointed by the chairman of the commission, to 
serve at the pleasure of the Commission, for the purposes of advising the 
commission on matters pertaining to the brucellosis program. 
 
     
  sec.35.4. Entry, Movement, and Change of Ownership . 
 
  (a) Requirements for cattle from foreign countries without comparable 
brucellosis status that enter and remain in Texas. (Note: Cattle from foreign 
countries with comparable brucellosis status would enter by meeting the 
requirements for a state with similar status.) 
 
  (1) (No change.) 
   
  (2) Branding requirements. 
 
  (A) Sexually intact cattle destined for a quarantined feedlot or designated 
pen must be "S"-branded prior to entry into the state. 
   
  (B) (No change.) 
     
  (3) Vaccination requirement. Nonvaccinated sexually intact female cattle 
between four and ten months of age entering for purposes other than immediate 
slaughter or feeding for slaughter in a quarantined feedlot or designated pen 
shall be placed under quarantine on arrival and officially brucellosis 
vaccinated as outlined in sec.35.2(m) of this title (relating to General 
Requirements). The quarantine may be released after meeting test requirements. 
   
  (4) Testing requirements for bulls entering for purposes other than immediate 
slaughter or feeding in a quarantined feedlot or designated pen. Bulls entering 
for purposes other than immediate slaughter or feeding in a quarantined feedlot 
or designated pen shall be tested at the port of entry into Texas under the 
supervision of the port veterinarian, and placed under quarantine and retested 
120 to 180 days after arrival. The quarantine will be released following a 
negative brucellosis test. 
   
  (5) Testing requirements for females entering for purposes other than 
immediate slaughter or feeding in a quarantined feedlot or designated pen. All 
sexually intact female cattle entering for purposes other than immediate 
slaughter or feeding for slaughter in a quarantined feedlot or designated pen 
shall be tested at the port of entry into Texas under the supervision of the 
port veterinarian, and placed under quarantine on arrival and retested for 
brucellosis in no less than 120 days nor more than 180 days after arrival for 
release of the quarantine. The releasing negative test shall not be sooner than 
30 days after the animal has had its first calf. 
   
  (6) Testing requirements for sexually intact cattle entering for feeding in a 
quarantined feedlot. All sexually intact cattle destined for feeding for 
slaughter in a quarantined feedlot or designated pen must be tested at the port 
of entry into Texas under the supervision of the port veterinarian. These cattle 
must be "S"-branded prior to entry into the state, and may move into the 
quarantined feedlot or designated pen only in sealed trucks with a permit issued 
by TAHC or USDA personnel. 
   
  (7) (No change.) 
     
  (b) Requirements for cattle entering Texas from other states. 
 
  (1) Vaccination. All female cattle between four and ten months of age shall be 
officially vaccinated prior to entry. Exceptions to these vaccination 
requirements: 
 
  (A)-(C) (No change.) 
   
  (D) Nonvaccinated female cattle between four and ten months of age consigned 
from an out-of-state farm of origin will be accompanied by a waybill to a Texas 
market, feedlot for feeding for slaughter or direct to slaughter. These cattle 
may be vaccinated at the market at no expense to the state prior to leaving the 
market and be moved freely. If these cattle are not vaccinated at the market 
then they shall be consigned from the market only to a feedlot for feeding for 
slaughter or direct to slaughter, accompanied by an "S" permit. Cattle from 
other than Class Free states entering for feeding for slaughter shall also be 
"F"-branded high on tail-head prior to or upon entering the feedlot. 
   
  (E) Nonvaccinated female cattle between four and ten months of age consigned 
from an out-of-state livestock market to a Texas livestock market, feedlot for 
feeding for slaughter or direct to slaughter will be accompanied by an "S" 
permit or certificate of veterinary inspection. Individual identification is not 
required. These cattle may be vaccinated at no expense to the state prior to 
leaving the market and be moved freely. If these cattle are not vaccinated at 
the market then they shall be consigned from the market only to a feedlot for 
feeding for slaughter or direct to slaughter, accompanied by an "S" permit. 
Cattle from other than Class Free states entering for feeding for slaughter 
shall also be "F"-branded high on tail-head prior to or upon entering the 
feedlot. 
   
  (F) Nonvaccinated female cattle between four and ten months of age moving may 
enter on a calfhood vaccination permit and must be vaccinated at no expense to 
the state within 14 days after arriving at the premise of destination. 
     
  (2) Testing. All test-eligible cattle entering Texas: 
 
  (A) (No change.) 
   
  (B) shall be "S"-branded and moved directly to a quarantined feedlot, to 
designated pens, or to slaughter, accompanied with an "S" permit, or moved 
directly from a farm of origin to a USDA specifically approved livestock market 
to be "S"-branded and moved directly to a quarantined feedlot, to designated 
pens, or to slaughter accompanied with an "S" permit; 
   
  (C)-(D) (No change.) 
   
  (E) shall be tested negative one or more times as described in this 
subparagraph: 
 
  (i)-(ii) (No change.) 
   
  (iii) all female cattle and test-eligible males from a Class "C" State or Area 
shall originate from a brucellosis certified free herd when consigned for 
purposes other than slaughter or to quarantined feedlot or designated pen. 
Females over four months of age must meet vaccination requirements for entry. 
         
  (c) Change of ownership within Texas. 
 
  (1) Vaccination. It is recommended that all female cattle between four and ten 
months of age being purchased or sold for use in grazing, breeding, or dairying 
operations be officially vaccinated. 
   
  (2) Testing. All test-eligible cattle changing ownership within Texas shall: 
 
  (A) (No change.) 
   
  (B) be tested negative by the seller within 30 days prior to sale; or 
   
  (C)-(D) (No change.) 
       
  (d) Movement to Mexico. All test-eligible cattle must be tested negative 
within 30 days prior to export to Mexico for slaughter. Steers, spayed heifers, 
and feedlot finished bulls and heifers are not required to be tested prior to 
export. Test results must be recorded on the Certificate of Veterinary 
Inspection. 
 
     
  sec.35.6. Indemnity Payments to Owners of Cattle Exposed to Brucellosis . 
 
  (a)-(b) (No change.) 
   
  (c) General Requirements. 
 
  (1)-(7) (No change.) 
   
  (8) The owner of a herd approved for depopulation must agree to complete a 
herd test of eligible animals in units not depopulated six to 12 months after 
depopulation. 
     
  (d) If approved by the State Epidemiologist, an owner may be paid $200 per B. 
abortus Strain 19 reactor, not to exceed the greater of five head or 5. 0% of 
the herd. 
 
     
  sec.35.7. Disposition of Animals Other Than Cattle That React to a Brucellosis 
Test. Equine that react positively to brucellosis testing and are diagnosed as 
infected shall be moved direct to slaughter accompanied by a VS Form 1-27 
permit. Reactor equine may be permitted to an approved market for sale to 
slaughter if approved by a State-Federal epidemiologist. The permit must 
individually describe each horse and show any individual identification. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on September 22, 1995. 
 TRD-9512230 
  Terry Beals, DVM 
 Executive Director 
 Texas Animal Health Commission 
    Effective date: October 22, 1995 
 Proposal publication date: July 28, 1995 
 For further information, please call: (512) 719-0714 
         
           Chapter 51. Interstate Shows, and Fairs 
  
  4 TAC sec.51.4 
 
  The Texas Animal Health Commission adopts an amendment to sec.51.4, concerning 
special requirements for entry from areas with vesicular stomatitis, with 
changes to the proposed text as published in the July 25, 1995, issue of the 
Texas Register (20 TexReg 5459). 
 The amendment is necessary to protect Texas livestock from exposure to 
vesicular stomatitis by prohibiting the entry of certain species of animals if 
they originate within ten miles of a premise where the disease has been 
diagnosed within the previous 30 days. The rule also requires animals 
originating from states where the disease has been diagnosed to be accompanied 
by a health certificate stating the animals did not originate within ten miles 
of a premise where the vesicular stomatitis has been diagnosed with the past 30 
days. A change was made to the statement required on the health certificate to 
acknowledge that the certifying veterinarian may not have personal knowledge of 
the location of the animals for the prior 30 days. 
 No comments were received regarding adoption of the amendment. 
 The amendment is adopted under the Texas Agriculture Code, Texas Civil 
Statutes, sec.161.081, which provide the Commission with the authority to 
promulgate rules regulating movement of animals into the state. 
 The amendment implements the Agriculture Code, sec.161.061 and sec.161.081, 
which provide the Commission with the authority to quarantine animals designated 
as potential carriers of disease and provide pre-entry requirements. 
 
 
  sec.51.4. Special Requirements for Entry from Areas with Vesicular Stomatitis 
. 
 
  (a) No equine, bovine, porcine, caprine, ovine, or cervidae may enter Texas 
from another state if vesicular stomatitis has been diagnosed within ten miles 
of the premise of origin within the last 30 days. 
   
  (b) Any equine, bovine, porcine, caprine, ovine, or cervidae entering Texas 
from a state where vesicular stomatitis has been diagnosed within the last 30 
days must be accompanied by a Certificate of Veterinary Inspection with the 
following statement written by the accredited veterinarian on the Certificate: 
To the best of my knowledge, all animals identified on this health certificate 
have been examined and found to be free from vesicular stomatitis. During the 
past 30 days, they have neither been exposed nor located within ten miles of a 
premise where vesicular stomatitis has been diagnosed. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on September 22, 1995. 
 TRD-9512231 
  Terry Beals, DVM 
 Executive Director 
 Texas Animal Health Commission 
    Effective date: October 22, 1995 
 Proposal publication date: July 25, 1995 
 For further information, please call: (512) 719-0714 
         
                 
  TITLE 25. HEALTH SERVICES 
 Part I. Texas Department of Health 
  Chapter 289. Radiation Control 
  
  The Texas Department of Health (department) adopts the repeal of existing 
sec.289.117 and new sec.289.256, concerning the use of sealed sources in the 
healing arts. New sec.289.256 is adopted with changes to the proposed text as 
published in the May 9, 1995, issue of the Texas Register  (20 TexReg 3440). The 
repeal is adopted without changes and will not be republished. 
 The new section incorporates language from Part 33, titled "Use of Sealed 
Sources in the Healing Arts," of the Texas Regulations for Control of Radiation 
(TRCR) which was adopted by reference in sec.289.117, which is now being 
repealed. In addition to incorporating existing language into new section 
requirements, sec.289.256 includes new provisions for patients treated with the 
temporary eye plaques to be released from hospitalization if the licensee 
ensures that the exposure rate from the patient at the treatment location is 
less than five milliroentgens per hour at a distance of one meter, the patient 
is provided with information on how to maintain doses to other individuals as 
low as reasonably achievable (ALARA), a radiation survey is made of the patient 
after removal of the plaque to ensure all sources have been removed, and upon 
removal, a physical inventory of the sources is conducted. These new provisions 
were added to the section in response to a petition for rulemaking requesting 
such provisions. 
 The repeal and new section are part of the first phase to convert existing 
sections that adopt by reference the various parts of the TRCR to Texas Register  
format. 
 The following are the public comments made concerning the proposed section and 
the department's responses to those comments. 
 Comment. Concerning sec.289.256(b)(5)(B), one commenter noted that the point of 
measurement should be at 1 meter from the surface of the patient. The physical 
location of the source may be arguable and/or vague, particularly for inspection 
personnel. The surface of the patient is not debatable. 
 Response. The department believes that requiring the measurement to be from the 
surface of the patient would be more confusing because this could be interpreted 
to be at the head, feet, back, or front of the patient. Patient records indicate 
what the patient is being treated for, where the permanent implant is located, 
and therefore, a more precise location from which the measurement is to be 
taken. The department made no change to the section as a result of the comment. 
 Comment. Concerning sec.289.256(b)(5)(B), one commenter expressed concern that 
the six milliroentgens per hour value was in conflict with sec.289.252(f) (3)(A) 
value of five milliroentgens per hour and the Texas Regulations for Control of 
Radiation (TRCR) Part 21.301(a)(3) value of two milliroentgens per hour. 
Confusion could be reduced and radiation safety improved if a single limit was 
settled on. The two milliroentgen per hour at a meter should be enacted since in 
view of TRCR Part 21.301, it would be difficult to justify any higher level. 
 Response. The department agrees in part with the commenter and has changed the 
value to five milliroentgens per hour to reflect consistency with the value in 
sec.289.252(f)(3)(A) and the United States Nuclear Regulatory Commission's value 
in its comparable regulation. The value in TRCR Part 21 is a dose of two 
millirem in any one hour, not a dose rate of two millirem per hour. 
 Comment. Concerning sec.289.256(b)(5)(C)(i), a commenter suggested that the 
words, "...in the language native to the individual..." should be inserted after 
"instructions." With the medical centers in Texas becoming drawing cards from 
around the world, proper instruction has to be clear to the patient. 
 Response. The section does not restrict the language in which the instructions 
are to be written. A medical center may choose to provide written instructions 
in a variety of languages. The department made no change to the section as a 
result of the comment. 
 Comment. Concerning sec.289.256(b)(5)(C)(iii), one commenter suggested that the 
clause might be less awkward if it was rearranged to read, "...after removal of 
the eye plaque and prior to release of the patient, a radiation survey of the 
patient is made with an appropriate survey instrument to determine that all 
sources have been removed;" 
 Response. The department agrees with the commenter and has changed the rule 
accordingly. The department has also changed the word "determine" to "verify." 
 Comment. Concerning sec.289.256(b)(5)(C)(iv), a commenter suggested that the 
words, "...the plaque is disassembled and..." be deleted because disassembly of 
Au-198 or I-125 seed plaques is not necessary to perform an inventory because 
the seeds are visible through the clear silicone. 
 Response. The department agrees with the commenter and has deleted sec.289. 
256(b)(5)(C)(iv), and has added a new sec.289.256(b)(5)(D) to read, "A physical 
inventory of the sources shall be conducted by the licensee to confirm that all 
sources have been removed from the patient and the inventory records shall be 
maintained for inspection by the agency." 
 Comment. Concerning sec.289.256(b)(5)(C)(iv), a commenter noted that the 
assumption seems to be that all eye plaques have radioactivity in the form of 
seeds and points out that this has not been true historically. Many types of 
plaques have not required seed loading and disassembling. The commenter 
suggested that a modifying phrase such as "When seed assemblies are used..." or 
"When applicable..." should be added. 
 Response. The department agrees with the commenter, has deleted sec.289. 
256(b)(5)(C)(iv), and has added a new sec.289.256(b)(5)(D) to read, "A physical 
inventory of the sources shall be conducted by the licensee to confirm that all 
sources have been removed from the patient and the inventory records shall be 
maintained for inspection by the agency." 
 In addition to the changes made in response to comments,  sec.289.256(b)(5)(E) 
was added to clarify recordkeeping requirements. 
 Commenters included a representative from the Methodist Hospital in Houston; 
Baylor College of Medicine in Houston; and two individuals. The commenters were 
generally in favor of the proposal; however, they presented comments and 
suggestions for changes to the proposal as previously discussed. 
   
  Texas Regulations for the Control of Radiation 
 
  25 TAC sec.289.117 
 
  The repeal is adopted under the Health and Safety Code, Chapter 401, which 
provides the Texas Board of Health with authority to adopt rules and guidelines 
relating to the control of radiation; and sec.12.001, which authorizes the board 
to adopt rules for the performance of every duty imposed by law on the board, 
the department, and the commissioner of health. 
 
 
  sec.289.117. Use of Sealed Sources in the Healing Arts. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on September 20, 1995. 
 TRD-9512070 
  Susan K. Steeg 
 General Counsel 
 Texas Department of Health 
    Effective date: November 1, 1995 
 Proposal publication date: May 9, 1995 
 For further information, please call: (512) 458-7236 
         
           
  License Regulations 
 
  25 TAC sec.289.256 
 
  The new section is adopted under the Health and Safety Code, Chapter 401, 
which provides the Texas Board of Health with authority to adopt rules and 
guidelines relating to the control of radiation; and sec.12.001, which 
authorizes the board to adopt rules for the performance of every duty imposed by 
law on the board, the department, and the commissioner of health. 
 
 
  sec.289.256. Use of Sealed Sources in the Healing Arts. 
 
  (a)  Scope. The provisions of this section apply to all licensees who use 
sealed sources in the healing arts and are in addition to, and not in 
substitution for, other applicable provisions of this chapter. 
   
  (b)  Interstitial, intracavitary, and superficial applications. 
 
  (1)  Accountability, storage and transit. 
 
  (A) Except as otherwise specifically authorized by the agency, each licensee 
shall provide accountability of sealed sources and shall keep a record of the 
issue and return of all sealed sources. A physical inventory shall be made at 
least every six months and a written record of the inventory maintained. 
   
  (B)  When not in use, sealed sources and applicators containing sealed sources 
shall be kept in a protective enclosure of such material and wall thickness as 
may be necessary to assure compliance with the provisions of 21.201, 21.207, and 
21.301 of Texas Regulations for Control of Radiation (TRCR) Part 21 as adopted 
by reference in sec.289.113 of this title (relating to Standards for Protection 
Against Radiation). 
     
  (2) Testing sealed sources for leakage and contamination. Sealed sources of 
radioactive material shall be tested for leakage and contamination in accordance 
with sec.289.201(g) of this title (relating to General Provisions). 
   
  (3) Radiation surveys. 
 
  (A)  The maximum radiation level at a distance of one meter from the patient 
in whom brachytherapy sources have been inserted shall be determined by 
measurement or calculation and preferably by both. This radiation level shall be 
entered on the patient's chart and other signs as required under paragraph (4) 
of this subsection. 
   
  (B) The radiation levels in the patient's room and the surrounding area shall 
be determined, recorded, and maintained for inspection by the agency. 
     
  (4) Signs and records. 
 
  (A) In addition to the requirements of 21.901, 21.902, and 21.904 of TRCR Part 
21 as adopted by reference in sec.289.113 of this title, the bed, cubicle, or 
room of the hospital brachytherapy patient shall be marked with a sign 
indicating the presence of brachytherapy sources. This sign shall incorporate 
the radiation symbol and specify the radionuclide, the activity, date, and the 
individual(s) to contact for radiation safety instructions. The sign is not 
required provided the exception in 21.903 is met. 
   
  (B) The following information shall be included in or on the patient's chart: 
 
  (i)  the radionuclide administered, number of sources, activity in millicuries 
and time and date of administration; 
   
  (ii) the exposure rate at one meter, the time the determination was made, and 
by whom; 
   
  (iii) the radiation symbol; and 
   
  (iv) the precautionary instructions necessary to assure that the exposure of 
individuals other than the patient does not exceed that permitted under 21.201 
of TRCR Part 21 as adopted by reference in sec.289.113 of this title. 
       
  (5)  Release of patients containing temporary implants or permanent implants. 
 
  (A) Immediately after removing the last temporary implant source or retraction 
of a source(s) from a remote control brachytherapy device at the conclusion of 
treatment, and before the patient is released from the therapy room, the 
licensee shall perform a radiation survey of the patient with an appropriate 
survey instrument. The licensee shall not release from confinement for medical 
care a patient treated by temporary implant or remote control brachytherapy 
device until all sources have been removed, except as provided in subparagraph 
(C) of this paragraph. 
   
  (B) Any individual containing permanent implant sources shall remain 
hospitalized and shall not be released from confinement until the maximum 
exposure rate from the patient is less than five milliroentgens per hour at a 
distance of one meter from the implant location. 
   
  (C) Upon prior approval by the agency of the licensee's written procedures, 
patients treated with temporary eye plaques may be released from the hospital 
provided that the procedures ensure that: 
 
  (i)  the exposure rate from the patient is less than five milliroentgens per 
hour at a distance of one meter from the eye plaque location; 
   
  (ii)  the patient is provided with written instructions and radiation safety 
guidance on how to maintain exposures to other individuals as low as reasonably 
achievable (ALARA); and 
   
  (iii) after removal of the eye plaque and prior to release of the patient, a 
radiation survey of the patient is made with an appropriate survey instrument to 
verify that all sources have been removed. 
     
  (D) A physical inventory of the sources shall be conducted by the licensee to 
confirm that all sources have been removed from the patient and the inventory 
records shall be maintained for inspection by the agency. 
   
  (E) Records of surveys required by subparagraph (C)(iii) of this paragraph 
shall be maintained for inspection by the agency. 
       
  (c)  Teletherapy. 
 
  (1) Equipment. 
 
  (A) The housing shall be so constructed that, at one meter from the source, 
the maximum exposure rate does not exceed ten milliroentgens per hour when the 
beam control mechanism is in the "off" position. The average exposure rate 
measured at a representative number of points about the housing, each one meter 
from the source, shall not exceed two milliroentgens per hour. 
   
  (B) For teletherapy equipment installed after January 1, 1970, the leakage 
radiation measured at one meter from the source when the beam control mechanism 
is in the "on" position shall not exceed one roentgen per hour or 0.1% of the 
useful beam exposure rate. 
   
  (C) Adjustable or removable beam-defining diaphragms shall allow transmission 
of not more than 5.0% of the useful beam exposure rate. 
   
  (D)  The beam control mechanism shall be of a positive design capable of 
acting in any orientation of the housing for which it is designed to be used. In 
addition to an automatic closing device, the mechanism shall be designed so that 
it can be manually returned to the "off" position with a minimum risk of 
exposure. 
   
  (E) The closing device shall be so designed as to return automatically to the 
"off" position in the event of any breakdown or interruption of the activating 
force and shall stay in the "off" position until re-activated from the control 
panel. 
   
  (F) When any door to the treatment room is opened, the beam control mechanism 
shall automatically and rapidly restore the unit to the "off" position and cause 
it to remain there until the door is secured and the unit is reactivated from 
the control panel. 
   
  (G) There shall be at the housing and at the control panel a warning device 
that plainly indicates whether the beam is on or off. 
   
  (H) The equipment shall be provided with a locking device to prevent 
unauthorized use and shall be locked in the "off" position when not attended. 
   
  (I) The control panel shall be provided with a timer that automatically 
terminates the exposure after a pre-set time. 
   
  (J) Provision shall be made to permit continuous observation of and two-way 
aural communication with patients during irradiation. 
     
  (2) Shielding. 
 
  (A) Primary protective barriers shall be provided for any area that the useful 
beam may strike when using the largest possible diaphragm opening. Such barriers 
should extend at least one foot beyond the useful beam for any possible 
orientation. 
   
  (B)  Secondary protective barriers shall be provided for all occupied areas 
exposed to leakage and scattered radiation. 
     
  (3) Operation. No individual who is occupationally exposed to radiation shall 
be in the treatment room during irradiation unless that individual is the 
patient. No other individual shall be there except when it is clinically 
necessary. 
   
  (4) Testing for leakage and contamination. Teletherapy sources shall be tested 
for leakage and contamination in accordance with the procedures described in 
sec.289.201(g) of this title (relating to General Provisions). Tests of leakage 
may be made by wiping accessible surfaces of the housing port or collimator 
while the source is in the "off" position and measuring these wipes for 
transferred contamination. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on September 20, 1995. 
 TRD-9512071 
  Susan K. Steeg 
 General Counsel 
 Texas Department of Health 
    Effective date: November 1, 1995 
 Proposal publication date: May 9, 1995 
 For further information, please call: (512) 458-7236 
         
                   Part II. Texas Department of Mental Health and Mental 
Retardation 
  Chapter 409. Medicaid Programs 
  
  Subchapter F. Case Management Program Requirements 
 
  25 TAC sec.sec.409.201, 409.203-409.207 
 
  The Texas Department of Mental Health and Mental Retardation (TDMHMR) adopts 
amendments to sec.sec.409.201 and 409.203-409.206; and new sec.409.207, 
concerning case management program requirements. Section 409.203 and sec.409. 
206 are adopted with changes to the proposed text as published in the July 28, 
1995, issue of the Texas Register (20 TexReg 5589). Sections 409.201, 409.204, 
409.205, and 409.207 are adopted without changes and will not be republished. 
 Section 409.203 is revised on adoption to indicate that the department will 
notify providers when the changes in program definitions, reimbursement 
methodology, or related matters are contingent on an amendment or amendments to 
the Texas State Plan for Medical Assistance Programs, which must be approved by 
the Health Care Financing Administration before taking effect. Section 
409.206(d)(1) is changed on adoption to include language explaining the 
reference to sec.409.201 (relating to Definitions). 
 Subsequent to the proposal, the fiscal note was recalculated. The use of the 
mean instead of the median for rate setting would increase the matching federal 
revenue by $225,934 for fiscal year 1995, $623,675 for fiscal year 1996, 
$641,289 for fiscal year 1997, $664,866 for fiscal year 1998, and $689, 249 for 
fiscal year 1999. 
 No comments were received regarding adoption of the amendments and new section. 
A public hearing was held on August 17, 1995; no one attended the hearing and no 
oral or written testimony was presented. 
 The amendments and new section are adopted under the Texas Health and Safety 
Code, Title 7, sec.532.015, which provides the Texas Board of Mental Health and 
Mental Retardation with rulemaking powers; and under the provisions of Texas 
Civil Statutes, Article 4413(502), sec.16, which provide the Health and Human 
Services Commission with the authority to administer federal medical assistance 
funds. 
 
 
  sec.409.203. Case Management Services. 
 
  (a) Case management services are provided to assist individuals with mental 
retardation or who have a related condition in gaining access to medical social, 
educational, and other appropriate services that will help them achieve a 
quality of life and community participation acceptable to each individual. The 
role of persons who provide case management activities is to support and assist 
the person in achieving personal goals. Case management is provided regardless 
of age. The department will notify providers when changes in program 
definitions, reimbursement methodology, and related matters are contingent on an 
amendment or amendments to the Texas State Plan for Medical Assistance Programs, 
which must be approved by the Health Care Financing Administration before taking 
effect. 
   
  (b) Case management services may include: 
 
  (1)  screening and assessment: obtaining client-identifying information and 
identifying the nature of the presenting problem and service and support needs 
of the individual; 
   
  (2) crisis intervention: locating and coordinating emergency services; 
   
  (3) service planning and coordination: identifying and arranging for the 
delivery of services and supports that address the individual's needs; 
   
  (4) monitoring: evaluating the effectiveness of the services and the need for 
additional or different services. 
 
       
  sec.409.206. Reimbursement Methodology for Case Management for Individuals 
with Mental Retardation or Related Condition. 
 
  (a) General Information. As specified in sec.sec.409.001-409.007 of this title 
(relating to General Specifications; Methodology; Basic Objectives and Criteria 
for Desk Review of Cost Reports; Determination of Inflation Indices; 
Notification; Adjusting Rates When New Legislation, Regulations, or Economic 
Factors Affect Costs; and Reviews and Administrative Hearings), TDMHMR 
reimburses qualified providers for case management services provided to Medicaid 
eligible individuals with mental retardation or a related condition. The Texas 
Board of Mental Health and Mental Retardation determines reimbursement at least 
annually for case management services. Reimbursement is: 
 
  (1) uniform statewide; 
   
  (2) prospective (see sec.409.201 of this title (relating to Definitions)); and 
   
  (3) cost related. 
     
  (b) Basis for Reimbursement Analysis. 
 
  (1) For the reimbursement period, providers will be reimbursed on the 
projected expenses required to provide case management services for individuals 
with mental retardation or a related condition. 
   
  (2) TDMHMR or its designee collects both statistical and cost data. The 
statistical information includes the number of telephone and in person (face-to-
face) case management contacts provided to clients and the number of direct 
server hours performed during the cost reporting period. The cost data include 
direct costs, programmatic indirect costs, and general and administrative costs, 
including salaries, benefits, and non-labor costs. 
   
  (3) The reimbursement is based upon cost report data submitted by providers, 
consultation with service providers, and consultation with professionals 
experienced in case management services. 
     
  (c) Reporting of Cost. 
 
  (1) Cost reporting. Each provider must submit financial and statistical 
information in a cost report or survey format designated by TDMHMR or its 
designee. The cost report will capture the expenses of the provider including 
salaries and benefits, administration, building and equipment, utilities, 
supplies, travel, and indirect overhead expenses related to the provision of 
case management services. 
   
  (2) The following requirements apply: 
 
  (A) Accounting requirements. All information submitted on the cost reports 
must be based upon the accrual method of accounting unless the governmental 
entity operates on a cash or modified accrual basis. The provider must complete 
the cost report according to the prescribed statement of allowable and 
unallowable costs. Cost reporting should be consistent with generally accepted 
accounting principles (GAAP). In cases in which cost reporting rules conflict 
with GAAP, Internal Revenue Service, or other authorities, the cost reporting 
rules take precedence for Medicaid provider cost reporting. 
   
  (B) Reporting period. The provider must prepare the cost report to reflect 
activities during the provider's fiscal year. The cost report is due three 
months after the end of this fiscal year, although an extension may be granted 
for good cause. TDMHMR or its designee may require cost reports or other 
information for other time periods. Failure to file an acceptable cost report or 
complete required additional information will result in a hold on the vendor 
payments until the cost report information or additional information is 
provided. The provider must certify the accuracy of the cost report or 
additional information. 
   
  (C) Review of cost reports. As specified in sec.409.003 of this title 
(relating to Basic Objectives and Criteria for Desk Review of Cost Reports), 
TDMHMR or its designee reviews each cost report or survey. Cost reports not 
completed according to instructions or rules are returned to the provider for 
proper completion. 
   
  (D) Onsite audit of cost reports. TDMHMR or its designee performs a sufficient 
number of audits each year to ensure the fiscal integrity of the case management 
reimbursement. The number of onsite audits actually performed each year may 
vary. Adjustments consistent with the results of onsite audits are made to the 
reimbursement base until the reimbursement base is closed for final 
reimbursement analysis. 
   
  (E) Recordkeeping requirements. Each provider must maintain records according 
to the requirements specified in Title 40, TAC, sec.69.202. The provider must 
ensure that the records are accurate and sufficiently detailed to support the 
financial and statistical information reported in the cost report. If a provider 
does not maintain records which support the financial and statistical 
information submitted on the cost report, the provider will be given 90 days to 
correct this recordkeeping. A hold of the vendor payments to the provider will 
be made if the deficiency is not corrected within 90 days from the date the 
provider is notified. 
   
  (F)  Access to records. The provider must allow TDMHMR or its designated 
agents access to any and all records necessary to verify information on the cost 
report. 
   
  (G) Reviews of cost report disallowances. A provider who disagrees with TDMHMR 
or its designee on cost report disallowances may request a review of the 
disallowances as specified in  sec.409.007 of this title (relating to Reviews 
and Administrative Hearings). 
   
  (H) TDMHMR or its designee notifies providers of exclusions and adjustments to 
reported expenses made during desk reviews and onsite audits of cost reports 
according to sec.409. 005 of this title (relating to Notification). 
       
  (d) Reimbursement methodology. 
 
  (1) Reimbursement by unit of service. Reimbursement for case management 
services will be determined for a unit of service defined as a case management 
contact. The action can be face-to-face or by telephone. See sec.409.201 of this 
title (relating to Definitions) for the definition of "case management contact." 
   
  (2) Exclusion or adjustment of expenses. Providers must eliminate unallowable 
expenses from the cost report. TDMHMR or its designee excludes from the 
reimbursement base any unallowable expenses included in the cost report and 
makes adjustments to expenses reported by providers to ensure that the 
reimbursement base reflects costs which are consistent with efficiency, economy 
and quality of care, are necessary for the provision of case management 
services, and are consistent with federal and state Medicaid regulations. If 
there is doubt as to the accuracy or allowability of a significant part of the 
information reported, individual cost reports may be eliminated from the 
reimbursement base. 
   
  (3)  Reimbursement determination process. The Texas Board of Mental Health and 
Mental Retardation determines reimbursement according to sec.409.001 of this 
title (relating to General Specifications). As specified in sec.409.006 of this 
title (relating to Adjusting Rates When New Legislation, Regulations, or 
Economic Factors Affect Costs), the Texas Board of Mental Health and Mental 
Retardation may also adjust reimbursements when new legislation, regulations, or 
economic factors affect costs. TDMHMR staff submit reimbursement recommendations 
to the Texas Board of Mental Health and Mental Retardation. Recommended 
reimbursements are determined in the following manner: 
 
  (A)  Total allowable costs for each provider will be determined from analyzing 
the allowable historical costs reported on the cost report. 
   
  (B) Each provider's total allowable costs are projected from the historical 
cost reporting period to the prospective reimbursement period using inflation 
factors according to  sec.409.004 of this title (relating to Determination of 
Inflation Indices). 
   
  (C) For each type of contact (face-to-face and telephone) each provider's cost 
per contact is calculated. The mean provider cost per contact is calculated, and 
the statistical outliers (those providers whose cost per contact exceeds plus or 
minus () two standard deviations of the mean provider cost per contact) are 
removed. After removal of the statistical outliers, the mean cost per contact is 
calculated. This mean cost per contact becomes the recommended reimbursement per 
contact as of May 20, 1995. 
       
  (e) General information. Only allowable cost information is used to compile 
the reimbursement base. See sec.409.201 of this title (relating to Definitions) 
for definitions of allowable and unallowable costs. 
 
  (1)  List of allowable costs. The following list of allowable costs is not 
comprehensive; instead, it is meant to serve as a general guide and to clarify 
certain key expense areas. The absence of a particular cost does not necessarily 
mean that expense is not an allowable cost. 
 
  (A)  Compensation of staff providing case management services. Compensation 
may be provided only to those staff who provide case management services 
directly to the clients or who support the work of staff providing case 
management services, including supervisors, administrators, and clerical 
workers. This category includes: 
 
  (i) wages and salaries; 
   
  (ii)  payroll taxes and insurance, including Federal Insurance Contributions 
Act (FICA or Social Security), unemployment compensation insurance, workman's 
compensation insurance; and 
   
  (iii) employee benefits. This category includes employer paid health, life 
accident, liability and disability insurance for employees; contributions to 
employee retirement funds; and deferred compensation limited to the dollar 
amount the employer contributes. 
     
  (B) Indirect costs. Costs incurred at administrative and support levels of 
management (that is, personnel, staff development, legal, quality assurance, 
accounting, bookkeeping, and building and equipment maintenance) above the staff 
providing case management services are allowable only if the costs were incurred 
in the purchase of materials, supplies, or services used by the staff providing 
case management services in the conduct of normal operations. Allowable costs 
are limited to the allocated portion of these costs which can be documented as 
being related to the delivery of case management services. 
   
  (C) Utilization review committee. 
   
  (D)  Materials and supplies. This category includes office supplies, 
housekeeping supplies, and materials and supplies for the operation, 
maintenance, and repair of buildings, grounds, and equipment. 
   
  (E)  Utilities. This category includes electricity, natural gas, fuel oil, 
water, waste water, garbage collection, telephone, and telegraph. 
   
  (F)  Buildings, equipment, and capital expenses. 
 
  (i) Buildings, equipment, and capital used by the staff providing case 
management services or in support of the staff providing case management 
services, and not for personal business. If these costs are shared with other 
program operations the portion of these costs relating directly to the provision 
of case management services may be allowed on a prorata basis if the proportion 
of use for provision of case management services is documented 
   
  (ii)  Depreciation and amortization expense. Property owned by the provider 
entity and improvements to owned, leased or rented property that is used in the 
provision of case management services that are valued at more than $500 at the 
time of purchase must be depreciated or amortized, using the straight line 
method. The minimum usable lives to be assigned to common classes of depreciable 
property are: 
 
  (I) buildings: a minimum of 30 years, with a minimum salvage value of 10%; 
   
  (II) transportation equipment used for the transport of clients, materials and 
supplies, or staff providing case management services: a minimum of three years 
for passenger automobiles, with a minimum salvage value of 10%; five years for 
light trucks and vans, with a minimum salvage value of 10%. 
       
  (G) Provider owned property. Property may be treated by the provider as 
ordinary expenses when the property and improvements to the property owned, 
leased, or rented by the provider are valued at less than $500 at the time of 
purchase. 
   
  (H) Rental and lease expense. This category includes buildings, building 
equipment, transportation equipment, equipment, materials and supplies. 
Allowable rental or lease expense paid to a related party is limited to the 
actual allowable cost incurred by the related party. 
   
  (I) Transportation expense. This category includes depreciation, lease, or 
mileage claimed at the allowable reimbursement per mile set by the state 
legislature for state employees. 
   
  (J) Business and professional association dues limited to associations devoted 
primarily to the issues of case management. 
   
  (K) Outside training costs. These expenses are limited to direct costs 
(transportation, meals, lodging, and registration fees) for training provided to 
staff providing case management services. The training must be directly related 
to issues concerning case management, and it must be located within the 
continental United States. 
     
  (2) List of unallowable costs. Unallowable costs are not included in the 
reimbursement base used to determine recommended reimbursement. The following 
list clarifies certain expense categories of unallowable costs. See also 
sec.409.201 of this title (relating to Definitions) for definition of 
unallowable costs. 
 
  (A) Compensation in the form of salaries, benefits, or any form of 
compensation given to individuals for the provision and support of services 
other than case management services. 
   
  (B) Personal expenses not directly related to the provision of case management 
services. 
   
  (C) Management fees or indirect costs that are not derived from the actual 
cost of materials, supplies or services provided directly to staff providing 
case management services. 
   
  (D) Advertising expenses other than those for advertising in the yellow pages, 
adds for employee recruitment, and advertising to meet any statutory or 
regulatory requirement. 
   
  (E) Business expenses not directly related to the provision of case management 
services. 
   
  (F) Political contributions. 
   
  (G) Depreciation and amortization of unallowable costs. This category includes 
amounts in excess of those resulting from straight line depreciation method, 
capitalized lease expenses in excess of the actual lease payment, and goodwill 
or any excess above the actual value of the physical assets at the time of 
purchase. 
   
  (H) Trade discounts of all types. This category includes returns, allowances, 
and refunds. 
   
  (I) Donated facilities, materials, supplies and services including the values 
assigned to the services of unpaid workers and volunteers. 
   
  (J) Dues to all types of political and social organizations, and to 
professional associations not directly and primarily concerned with case 
management services. 
   
  (K) Entertainment expenses except those incurred for entertainment provided to 
the staff providing case management services as an employee benefit. 
   
  (L) Board of directors fees. 
   
  (M) Fines and penalties for violations of regulations, statutes, and 
ordinances of all types. 
   
  (N) Fundraising and promotional expenses. 
   
  (O) Interest expenses on loans pertaining to unallowable items and on that 
portion of interest paid which is reduced or offset by interest income. 
   
  (P) Insurance premiums pertaining to items of unallowable cost. 
   
  (Q) Accrued expenses that are not a legal obligation of the provider or are 
not clearly enumerated as to dollar amount. This category includes any form of 
profit sharing and the accrued liabilities of deferred compensation plans. 
   
  (R) Mileage expense exceeding the current reimbursement rate set by the Texas 
Legislature for state employee travel. 
   
  (S) Costs of purchases from a related party which exceed the original cost to 
the related party. 
   
  (T) Out of state travel expenses, except for provision of case management 
related services including training and quality assurance functions. 
   
  (U) Contributions to self-insurance funds which do not represent payments 
based on current liabilities. 
   
  (V)  Expenses incurred because of imprudent business practices. 
   
  (W)  Expenses which cannot adequately be documented. 
   
  (X) Expenses not reported according to the instructions of the cost report. 
   
  (Y)  Expenses not allowable under other pertinent federal, state, or local 
laws or regulations. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on September 22, 1995. 
 TRD-9512155 
  Ann Utley 
 Chairman, Texas MHMR Board 
 Texas Department of Mental Health and Mental Retardation 
    Effective date: October 13, 1995 
 Proposal publication date: July 28, 1995 
 For further information, please call: (512) 206-4516 
         
                 
  Subchapter G. Case Management for Persons with Severe and Persistent Mental 
Illness 
 
  25 TAC sec.sec.409.251-409.256 
 
  The Texas Department of Mental Health and Mental Retardation (TDMHMR) adopts 
amendments to sec.sec.409.251-409.255 and new sec.409.256, concerning case 
management for persons with severe and persistent mental illness. Section 409. 
252 and  sec.409.255 are adopted with changes to the proposed text as published 
in the July 28, 1995, issue of the Texas Register  (20 TexReg 5592). Sections 
409.251, 409.253, 409.254, and 409.256 are adopted without changes and will not 
be republished. 
 Section 409.203 is revised on adoption to indicate that the department will 
notify providers when the changes in program definitions, reimbursement 
methodology, or related matters are contingent on an amendment or amendments to 
the Texas State Plan for Medical Assistance Programs, which must be approved by 
the Health Care Financing Administration before taking effect. Section 
409.255(c)(2)(F) is revised on adoption to substitute the term "designee" for 
"designated agent." 
 Subsequent to the proposal, the fiscal note was recalculated. The use of the 
mean instead of the median for rate setting would increase the matching federal 
revenue by $335,059 for fiscal year 1995, $1,072,147 for fiscal year 1996, 
$1,102,426 for fiscal year 1997, $1,142,957 for fiscal year 1998, and $1, 
184,873 for fiscal year 1999. 
 Public comment was received from the Texas Alliance for the Mentally Ill, 
Austin, which commented that the proposed changes are acceptable. A public 
hearing was held on August 17, 1995; no one attended the hearing and no oral or 
written testimony was presented. 
 The amendments and new section are adopted under the Texas Health and Safety 
Code, Title 7, sec.532.015, which provides the Texas Board of Mental Health and 
Mental Retardation with rulemaking powers; and under the provisions of Texas 
Civil Statutes, Article 4413(502), sec.16, which provide the Health and Human 
Services Commission with the authority to administer federal medical assistance 
funds. 
 
 
  sec.409.252. Case Management Services. 
 
  (a) Case management services are provided to assist individuals with severe 
and persistent mental illness in gaining access to medical, social, educational, 
and other appropriate services that will help them achieve a quality of life and 
community participation acceptable to each individual. The role of persons who 
provide case management activities is to support and assist the person in 
achieving personal goals. Case management is provided regardless of age. The 
department will notify providers when changes in program definitions, 
reimbursement methodology, and related matters are contingent on an amendment or 
amendments to the Texas State Plan for Medical Assistance Programs, which must 
be approved by the Health Care Financing Administration before taking effect. 
   
  (b) Case management services may include: 
 
  (1)  screening and assessment: obtaining client-identifying information and 
identifying the nature of the presenting problem and the service and support 
needs of the individual; 
   
  (2) crisis intervention: locating and coordinating emergency services; 
   
  (3) service planning and coordination: identifying and arranging for the 
delivery of services and supports that address the individual's needs; and 
   
  (4) monitoring: evaluating the effectiveness of the services and the need for 
additional or different services. 
 
       
  sec.409.255. Reimbursement Methodology for Case Management for Persons with 
Severe and Persistent Mental Illness. 
 
  (a) General Information. As specified in sec.sec.409.001-409.007 of this title 
(relating to General Specifications; Methodology; Basic Objectives and Criteria 
for Desk Review of Cost Reports; Determination of Inflation Indices; 
Notification; Adjusting Rates When New Legislation, Regulations, or Economic 
Factors Affect Costs; and Reviews and Administrative Hearings), the Texas 
Department of Mental Health and Mental Retardation TDMHMR reimburses qualified 
providers for case management services provided to Medicaid eligible individuals 
with severe and persistent mental illness. The Texas Board of Mental Health and 
Mental Retardation determines reimbursements at least annually for case 
management services. The reimbursements are: 
 
  (1) uniform statewide; 
   
  (2)  prospective (see sec.409.201 of this title (relating to Definitions)); 
and 
   
  (3) cost related. 
     
  (b) Basis for Reimbursement Analysis. 
 
  (1) For the reimbursement period, providers will be reimbursed on the 
projected expenses required to provide case management services for persons with 
severe and persistent mental illness. 
   
  (2) TDMHMR or its designee collect both statistical and cost data. The 
statistical information includes the number of telephone and in person (face-to-
face) contacts provided to clients and the number of direct server hours 
performed during the cost reporting period. The cost data include direct costs, 
programmatic indirect costs, and general and administrative costs, including 
salaries, benefits, and nonlabor costs. 
   
  (3) The reimbursement is based on cost report data submitted by providers, 
consultation with service providers, and consultation with professionals 
experienced in case management services. 
     
  (c)  Reporting of Cost. 
 
  (1) Cost reporting. Each provider must submit financial and statistical 
information in a cost report or survey format designated by TDMHMR or its 
designee. The cost report will capture the expenses of the provider including 
salaries and benefits, administration, building and equipment, utilities, 
supplies, travel, and indirect overhead expenses related to the provision of 
case management services. 
   
  (2)  The following requirements apply: 
 
  (A) Accounting requirements. All information submitted on the cost reports 
must be based upon the accrual method of accounting unless the governmental 
entity operates on a cash or modified accrual basis. The provider must complete 
the cost report according to the prescribed statement of allowable and 
unallowable costs. Cost reporting should be consistent with generally accepted 
accounting principles (GAAP). In cases in which cost reporting rules conflict 
with GAAP, Internal Revenue Service, or other authorities, the cost reporting 
rules take precedence for Medicaid provider cost reporting. 
   
  (B) Reporting period. The provider must prepare the cost report to reflect 
activities during the provider's fiscal year. The cost report is due three 
months after the end of this fiscal year, although an extension may be granted 
for good cause. TDMHMR or its designee may require cost reports or other 
information for other time periods. Failure to file an acceptable cost report or 
complete required additional information will result in a hold on the vendor 
payments until the cost report information or additional information is 
provided. The provider must certify the accuracy of the cost report or 
additional information. 
   
  (C) Review of cost reports. As specified in sec.409.003 of this title 
(relating to Basic Objectives and Criteria for Desk Review of Cost Reports), 
TDMHMR or its designee reviews each cost report or survey. Cost reports not 
completed according to instructions or rules are returned to the provider for 
proper completion. 
   
  (D) Onsite audit of cost reports. TDMHMR or its designee performs a sufficient 
number of audits each year to ensure the fiscal integrity of the case management 
reimbursement. The number of onsite audits actually performed each year may 
vary. Adjustments consistent with the results of onsite audits are made to the 
reimbursement base until the reimbursement base is closed for final 
reimbursement analysis. 
   
  (E) Recordkeeping requirements. Each provider must maintain records according 
to the requirements specified in Title 40, TAC, sec.69.202. The provider must 
ensure that the records are accurate and sufficiently detailed to support the 
financial and statistical information reported in the cost report. If a provider 
does not maintain records which support the financial and statistical 
information submitted on the cost report, the provider will be given 90 days to 
correct this recordkeeping. A hold of the vendor payments to the provider will 
be made if the deficiency is not corrected within 90 days from the date the 
provider is notified. 
   
  (F) Access to records. The provider must allow TDMHMR or its designee access 
to any and all records necessary to verify information on the cost report. 
   
  (G) Reviews of cost report disallowances. A provider who disagrees with TDMHMR 
or its designee on cost report disallowances may request a review of the 
disallowances as specified in  sec.409.007 of this title (relating to Reviews 
and Administrative Hearings). 
   
  (H) TDMHMR or its designee notifies providers of exclusions and adjustments to 
reported expenses made during desk reviews and onsite audits of cost reports 
according to sec.409.005 of this title (relating to Notification). 
       
  (d) Reimbursement methodology. 
 
  (1) Reimbursement by unit of service. Reimbursement for case management 
services will be determined for a unit of service defined as a case management 
contact. The action can be face-to-face or by telephone. See sec.409.201 of this 
title (relating to Definitions). 
   
  (2) Exclusion or adjustment of expenses. Providers must eliminate unallowable 
expenses from the cost report. TDMHMR or its designee excludes from the 
reimbursement base any unallowable expenses included in the cost report and 
makes adjustments to expenses reported by providers to ensure that the 
reimbursement base reflects costs which are consistent with efficiency, economy 
and quality of care, are necessary for the provision of case management 
services, and are consistent with federal and state Medicaid regulations. If 
there is doubt as to the accuracy or allowability of a significant part of the 
information reported, individual cost reports may be eliminated from the 
reimbursement base. 
   
  (3) Reimbursement determination process. The Texas Board of Mental Health and 
Mental Retardation determines reimbursement according to sec.409.001 of this 
title (relating to General Specifications). As specified in sec.409.006 of this 
title (relating to Adjusting Rates When New Legislation, Regulations, or 
Economic Factors Affect Costs), the Texas Board of Mental Health and Mental 
Retardation may also adjust reimbursements when new legislation, regulations, or 
economic factors affect costs. TDMHMR staff submit reimbursement recommendations 
to the Texas Board of Mental Health and Mental Retardation. Recommended 
reimbursements are determined in the following manner: 
 
  (A) Total allowable costs for each provider will be determined from analyzing 
the allowable historical costs reported on the cost report. 
   
  (B) Each provider's total allowable costs are projected from the historical 
cost reporting period to the prospective reimbursement period using inflation 
factors according to  sec.409. 004 of this title (relating to Determination of 
Inflation Indices). 
   
  (C)  For each type of contact (face-to-face and telephone) each provider cost 
per contact is calculated. The mean provider cost per contact is calculated, and 
the statistical outliers (those providers whose cost per contact exceeds plus or 
minus () two standard deviations of the mean provider cost per contact) are 
removed. After removal of the statistical outliers, the mean cost per contact is 
calculated. This mean cost per contact becomes the recommended reimbursement per 
contact as of May 20, 1995. 
       
  (e) Cost information. Only allowable cost information is used to compile the 
reimbursement base. See sec.409.201 of this title (relating to Definitions) for 
definitions of allowable and unallowable costs. 
 
  (1) List of allowable costs. The following list of allowable costs is not 
comprehensive; instead, it is meant to serve as a general guide and to clarify 
certain key expense areas. The absence of a particular cost does not necessarily 
mean that expense is not an allowable cost. 
 
  (A) Compensation of staff providing case management services. Compensation may 
be provided only to those staff who provide case management services directly to 
the clients or who support the work of staff providing case management services, 
including supervisors, administrators, and clerical workers. This category 
includes: 
 
  (i) wages and salaries. 
   
  (ii) payroll taxes and insurance, including Federal Insurance Contributions 
Act (FICA or Social security), unemployment compensation insurance, workman's 
compensation insurance; and 
   
  (iii) employee benefits. This category includes employer paid health, life 
accident, liability and disability insurance for employees; contributions to 
employee retirement funds; and deferred compensation limited to the dollar 
amount the employer contributes. 
     
  (B) Indirect costs. Costs incurred at administrative and support levels of 
management (that is, personnel, staff development, legal, quality assurance, 
accounting, bookkeeping, and building and equipment maintenance) above the staff 
providing case management services are allowable only if the costs were incurred 
in the purchase of materials, supplies, or services used by the staff providing 
case management services in the conduct of normal operations. Allowable costs 
are limited to the allocated portion of these costs which can be documented as 
being related to the delivery of case management services. 
   
  (C) Utilization review committee. 
   
  (D) Materials and supplies. This category includes office supplies, 
housekeeping supplies, and materials and supplies for the operation, 
maintenance, and repair of buildings, grounds, and equipment. 
   
  (E)  Utilities. This category includes electricity, natural gas, fuel oil, 
water, waste water, garbage collection, telephone and telegraph. 
   
  (F)  Buildings, equipment, and capital expenses. 
 
  (i) Buildings, equipment, and capital used by the staff providing case 
management services or in support of the staff providing case management 
services , and not for personal business. If these costs are shared with other 
program operations the portion of these costs relating directly to the provision 
of case management services may be allowed on a prorata basis if the proportion 
of use for provision of case management services is documented. 
   
  (ii)  Depreciation and amortization expense. Property owned by the provider 
entity and improvements to owned, leased or rented property used for the 
provision of case management services that are valued at more than $500 at the 
time of purchase must be depreciated or amortized, using the straight line 
method. The minimum usable lives to be assigned to common classes of depreciable 
property are: 
 
  (I) buildings: a minimum of 30 years, with a minimum salvage value of 10%; 
   
  (II) transportation equipment used for the transport of clients, materials and 
supplies, or staff providing case management services: a minimum of three years 
for passenger automobiles, with a minimum salvage value of 10%; five years for 
light trucks and vans, with a minimum salvage value of 10%. 
       
  (G) Provider-owned property. Property may be treated by the provider as 
ordinary expenses when the property and improvements to the property owned, 
leased, or rented by the provider are valued at less than $500 at the time of 
purchase. 
   
  (H) Rental and lease expense. This category includes buildings, building 
equipment, transportation equipment, equipment, materials and supplies. 
Allowable rental or lease expense paid to a related party is limited to the 
actual allowable cost incurred by the related party. 
   
  (I) Transportation expense. This category includes depreciation, lease, or 
mileage claimed at the allowable reimbursement per mile set by the state 
legislature for state employees. 
   
  (J) Business and professional association dues limited to associations devoted 
primarily to the issues of case management. 
   
  (K) Outside training costs. These expenses are limited to direct costs 
(transportation, meals, lodging, and registration fees) for training provided to 
personnel rendering services directly to the clients or staff providing case 
management services. The training must be directly related to issues concerning 
case management, and it must be located within the continental United States. 
     
  (2) List of unallowable costs. Unallowable costs are not included in the 
reimbursement base used to determine recommended reimbursement. The following 
list clarifies certain expense categories of unallowable costs. See also 
sec.409.201 of this title (relating to Definitions) for definition of 
unallowable costs. 
 
  (A) Compensation in the form of salaries, benefits, or any form of 
compensation given to individuals for the provision and support of services 
other than case management services. 
   
  (B) Personal expenses not directly related to the provision of case management 
services. 
   
  (C) Management fees or indirect costs that are not derived from the actual 
cost of materials, supplies or services provided directly to staff providing 
case management services. 
   
  (D) Advertising expenses other than those for advertising in the yellow pages, 
adds for employee recruitment, and advertising to meet any statutory or 
regulatory requirement. 
   
  (E)  Business expenses not directly related to the provision of case 
management services. 
   
  (F) Political contributions. 
   
  (G) Depreciation and amortization of unallowable costs. This category includes 
amounts in excess of those resulting from straight line depreciation method, 
capitalized lease expenses in excess of the actual lease payment, and goodwill 
or any excess above the actual value of the physical assets at the time of 
purchase. 
   
  (H) Trade discounts of all types. This category includes returns, allowances, 
and refunds. 
   
  (I) Donated facilities, materials, supplies and services including the values 
assigned to the services of unpaid workers and volunteers. 
   
  (J) Dues to all types of political and social organizations, and to 
professional associations not directly and primarily concerned with case 
management services. 
   
  (K) Entertainment expenses except those incurred for entertainment provided to 
the staff providing case management services as an employee benefit. 
   
  (L) Board of director fees. 
   
  (M) Fines and penalties for violations of regulations, statutes, and 
ordinances of all types. 
   
  (N) Fundraising and promotional expenses. 
   
  (O) Interest expenses on loans pertaining to unallowable items and on that 
portion of interest paid which is reduced or offset by interest income. 
   
  (P) Insurance premiums pertaining to items of unallowable cost. 
   
  (Q) Accrued expenses that are not a legal obligation of the provider or are 
not clearly enumerated as to dollar amount. This category includes any form of 
profit sharing and the accrued liabilities of deferred compensation plans. 
   
  (R) Mileage expense exceeding the current reimbursement rate set by the Texas 
Legislature for state employee travel. 
   
  (S) Costs of purchases from a related party which exceed the original cost to 
the related party. 
   
  (T) Out of state travel expenses, except for provision of case management 
related services including training and quality assurance functions. 
   
  (U) Contributions to self insurance funds which do not represent payments 
based on current liabilities. 
   
  (V)  Expenses incurred because of imprudent business practices. 
   
  (W)  Expenses which cannot adequately be documented. 
   
  (X) Expenses not reported according to the instructions of the cost report. 
   
  (Y)  Expenses not allowable under other pertinent federal, state, or local 
laws or regulations. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on September 22, 1995. 
 TRD-9512156 
  Ann Utley 
 Chairman, Texas MHMR Board 
 Texas Department of Mental Health and Mental Retardation 
    Effective date: October 13, 1995 
 Proposal publication date: July 28, 1995 
 For further information, please call: (512) 206-4516 
         
                 
  Subchapter I. Rehabilitative Services for Persons with Mental Illness 
 
  25 TAC sec.sec.409.351-409.357 
 
  The Texas Department of Mental Health and Mental Retardation (TDMHMR) adopts 
amendments to sec.sec.409.351-409.357, concerning rehabilitative services for 
persons with mental illness. Section 409.356 is adopted with changes to the 
proposed text as published in the August 1, 1995, issue of the Texas Register  
(20 TexReg 5694). Sections 409.351-409.355, and 409.357, are adopted without 
changes and will not be republished. 
 Section 409.356(c)(3) is revised on adoption to correct a typographical error. 
 Subsequent to the proposal, the fiscal note was recalculated. The use of the 
mean instead of the median for rate setting would increase the matching federal 
revenue by $2,191,152 for fiscal year 1995, $5,806,196 for fiscal year 1996, 
$3,903,635 for fiscal year 1997, $4,047,155 for fiscal year 1998, and $4, 
195,577 for fiscal year 1999. 
 Public comment was received from the Texas Alliance for the Mentally Ill, 
Austin, and the Center for Health Care Services, San Antonio. A public hearing 
was held on August 17, 1995; no one attended the hearing and no oral or written 
testimony was presented. 
 One commenter stated that the proposed changes were acceptable to the 
commenter's organization. 
 Another commenter suggested adding a required timeframe for documentation of 
services provided prior to or outside the plan of care. The department responds 
that it is appropriate to allow each Medicaid enrolled provider to regulate its 
own timeframes. The department notes, however, that language is in place 
requiring documentation before the provider may bill for services. 
 The same commenter asked if the proposed appeal procedures were different from 
the existing appeals procedures. The department responds that the only change to 
the appeal procedures is the submission of a request for a hearing to TDMHMR, 
rather than the Texas Department of Human Services. 
 The amendments are adopted under the Texas Health and Safety Code, Title 7, 
sec.532.015, which provides the Texas Board of Mental Health and Mental 
Retardation with rulemaking powers; and under the provisions of Texas Civil 
Statutes, Article 4413(502), sec.16, which provide the Health and Human Services 
Commission with the authority to administer federal medical assistance funds. 
 
 
  sec.409.356. Rehabilitative Services Reimbursement Methodology. 
 
  (a) General information. 
 
  (1) The Texas Department of Mental Health and Mental Retardation (TDMHMR) or 
its designee will reimburse qualified providers for rehabilitative services 
provided to Medicaid eligible persons with mental illness. 
   
  (2) The Texas Board of Mental Health and Mental Retardation determines 
reimbursement in accordance with sec.sec.409.001-409. 007 of this title 
(relating to General Specifications; Methodology; Basic Objectives and Criteria 
for Desk Review of Cost Reports; Determination of Inflation Indices; 
Notification; Adjusting Rates When New Legislation, Regulations, or Economic 
Factors Affect Costs; and Reviews and Administrative Hearings). The 
reimbursement is uniform, determined prospectively and at least annually. 
Reimbursement may be determined more often than annually if the Texas Board of 
Mental Health and Mental Retardation determines it to be necessary. 
     
  (b) Basis for the reimbursement analysis. 
 
  (1) For the reimbursement period, providers will be reimbursed on the 
projected expenses required to provide rehabilitative services. 
   
  (2) TDMHMR or its designee will collect several different kinds of data. These 
include the number of rehabilitative services units of service in 15-minute 
increments that clients receive and the number of direct care server minutes, 
defined as direct server time by staff. The cost data will include direct costs, 
programmatic indirect costs, and general and administrative overhead costs. 
These costs include salaries, benefits, and other costs. 
   
  (3) The reimbursement will be developed via TDMHMR or its designee's cost 
report data submitted by providers, consultation with service providers, and 
professionals experienced in rehabilitative services. 
     
  (c) Reporting of Costs. 
 
  (1) Cost reporting. Providers must submit information annually, unless 
otherwise specified, on cost report forms provided by TDMHMR or its designee or 
on facsimiles formatted according to TDMHMR or its designee's specifications, 
and that are preapproved by TDMHMR or its designee. From the data, TDMHMR or its 
designee will develop and implement cost based statewide, uniform reimbursements 
for rehabilitative services. Providers must complete the cost report forms 
according to the rules and specifications set forth in the methodology specified 
in this section. 
   
  (2) Reporting period and due date. Provider agencies must prepare the cost 
report to reflect rehabilitative activities during the designated cost report 
reporting period. The cost reports must be submitted to TDMHMR or its designee 
no later than 90 days following the end of the designated reporting period 
unless otherwise specified by TDMHMR or its designee. 
   
  (3) Extension of the due date. TDMHMR or its designee may grant extensions of 
due dates for good cause. A good cause is one that the provider agency could not 
reasonably be expected to control. Provider agencies must submit requests for 
extensions in writing to TDMHMR or its designee before the cost report due date. 
TDMHMR or its designee responds to requests within ten workdays of receipt. 
   
  (4) Failure to file an acceptable cost report. If a provider agency fails to 
file a cost report according to all applicable rules and instructions, TDMHMR or 
its designee may withhold all provider payments until the provider agency 
submits an acceptable cost report. 
   
  (5) Allocation method. If allocations of cost are necessary, provider agencies 
must use and be able to document reasonable methods of allocation. TDMHMR or its 
designee adjusts allocated costs if TDMHMR or its designee considers the 
allocation method to be unreasonable. The provider agency must retain workpapers 
supporting allocations, as specified in Title 40, TAC, sec.69.202. 
   
  (6) Cost report certification. Provider agencies must certify the accuracy of 
cost reports submitted to TDMHMR or its designee in the format specified by 
TDMHMR or its designee. Provider agencies may be liable for civil and/or 
criminal penalties if they misrepresent or falsify information. 
   
  (7) Cost data supplements. TDMHMR or its designee may at times require 
additional financial and statistical information other than the information 
contained on the cost report. 
   
  (8) Review of cost reports. TDMHMR or its designee staff review each cost 
report to ensure that all financial and statistical information submitted 
conforms to all applicable rules and instructions. The review of the cost report 
includes a desk audit. TDMHMR or its designee reviews all cost reports according 
to the criteria specified in sec.409.003 of this title (relating to Basic 
Objectives and Criteria for Desk Review of Cost Reports). If a provider agency 
fails to complete the cost report according to instructions or rules, TDMHMR or 
its designee returns the cost report to the provider agency for proper 
completion. TDMHMR or its designee may require information other than that 
contained in the cost report to substantiate reported information. 
   
  (9) On-site audits. TDMHMR or its designee may perform on-site audits on all 
provider agencies that participate in the Medicaid program for rehabilitative 
services. TDMHMR or its designee determines the frequency and nature of audits 
but ensures that they are not less than that required by federal regulations 
related to the administration of the program. 
   
  (10) Notification of exclusions and adjustments. TDMHMR or its designee 
notifies providers of exclusions and adjustments to reported expenses made 
during desk reviews and on-site audits of cost reports as specified in 
sec.409.005 of this title (relating to Notification). 
   
  (11)  Access to records. Each contracted provider must allow access to any and 
all records necessary to verify cost report information submitted to TDMHMR or 
its designee. This requirement includes records pertaining to related party 
transactions and other business activities engaged in by the contracted 
provider. If a provider agency does not allow inspection of pertinent records 
within 30 days following written notice from TDMHMR or its designee, a hold is 
placed on vendor payments until access to the records is allowed. If the 
provider agency continues to deny access to records, TDMHMR or its designee may 
cancel the provider agency's contract. 
   
  (12) Recordkeeping requirements. Provider agencies must maintain records 
according to the requirements specified in Title 40, TAC, sec.69.202. Provider 
agencies must ensure that records are accurate and sufficiently detailed to 
support the financial and statistical information contained in cost reports. 
   
  (13)  Failure to maintain adequate records. If a provider agency fails to 
maintain adequate records to support the financial and statistical information 
reported in cost reports, TDMHMR or its designee allows 90 days for the provider 
to bring recordkeeping into compliance. If a provider agency fails to correct 
deficiencies within 90 days from the date of notification of the deficiency, 
TDMHMR or its designee may cancel the provider agency's contract for services. 
     
  (d) Reimbursement determination. TDMHMR or its designee determines 
reimbursement in the following manner: 
 
  (1) Inclusion of certain reported expenses. Provider agencies must ensure that 
all requested costs are included in the cost report. 
   
  (2) Data collection. TDMHMR or its designee collects several different kinds 
of data. These include the number of rehabilitative services units of service in 
15-minute increments that clients receive (client time) and the number of direct 
care service minutes by staff (server minutes). The cost data will include 
direct costs, programmatic indirect costs, and general and administrative 
overhead costs. These costs include salaries, benefits, and other costs. Other 
costs include nonsalary related costs such as building and equipment 
maintenance, repair, depreciation, amortization, and insurance expenses; 
employee travel and training expenses; utilities; plus material and supply 
expenses. 
 
  (A)  Server minutes are collected by the type of service delivered and the 
annualized salary tier of the server. These services are specified in sec.409. 
353 of this title (relating to Rehabilitative Services). 
   
  (B) The server minutes can be given by professionals and paraprofessionals. 
These include, but are not necessarily limited to physicians, psychologists, 
nurses, social workers, mental health technicians, counselors, therapists, and 
therapy associates. TDMHMR or its designee collects the wages, salaries, 
benefits, and other costs so that reimbursement can be determined. 
   
  (C) Programmatic indirect costs include salaries, benefits, and other costs of 
the rehabilitative service programs that are indirectly related to the delivery 
of rehabilitative services to individuals. General administrative overhead 
includes the salaries, benefits, and other costs of operations of the provider 
that, while not directly part of the rehabilitative program, constitute costs 
that support the operations of the rehabilitative program. 
   
  (D) Costs are aggregated into three salary tiers based on the percentage of 
direct servers' salaries in each tier. A percentage is calculated by dividing 
the individual tiers by the total of the three tiers. These percentages are used 
as allocation factors to subdivide total net allowable costs into cost pools 
based on salary tier. Then each of these pools is separately allocated to the 
various rehabilitative services based on the percentage of server minutes 
utilized within each service category and salary tier. The server minutes are 
identified by individual service and salary tiers. TDMHMR or its designee 
determines the reimbursement for providing each individual service by summing 
the total costs in each salary tier and then dividing the total cost of each 
service by the total units of service in 15-minute increments. 
     
  (3)  Reimbursement methodology. TDMHMR determines the recommended 
reimbursement using the following method: 
 
  (A) Cost per unit of service. Within an individual service, the unit cost is 
determined by dividing the total cost of the rehabilitative service by the total 
units of service in 15-minute increments. 
   
  (B) Projected and adjusted costs. Reported costs are projected and adjusted 
prior to calculations for determining reimbursement. TDMHMR or its designee uses 
reasonable methods for projecting costs from the historical reporting period to 
the prospective reimbursement period. The historical reporting period is the 
time period covered by the cost report. Cost projections adjust the allowed 
historical costs for significant changes in cost related conditions anticipated 
to occur between the historical cost period and the prospective reimbursement 
period. Significant conditions include, but are not necessarily limited to, wage 
and price inflation or deflation, changes in program utilization and occupancy, 
modification of federal or state regulations and statutes, and implementation of 
federal or state court orders and settlement agreements. TDMHMR or its designee 
determines reasonable and appropriate economic adjusters, as specified in 
sec.409.004 of this title (relating to Determination of Inflation Indices), to 
calculate the projected expenses. The Implicit Price Deflator for Personal 
Consumption Expenditures (IPD-PCE), which is based on data from the U.S. 
Department of Commerce, is the most general measure of inflation and is applied 
to most salaries, materials, supplies, and services when other specific 
inflators are not appropriate. The three payroll tax inflators, FICA (Social 
Security), FUTA/SUTA (federal and state unemployment) and WCI (Workers' 
Compensation) are based on data obtained from the Statistical Abstract of the 
United States, the Texas Employment Commission and the Texas Board of Insurance, 
respectively. For community based providers, wage inflation factors are based on 
wage and hour survey information submitted on cost reports or special surveys or 
the IPD-PCE, when wage and hour survey information is unavailable. For state 
operated providers, the inflation factor is based on wage increases approved by 
the Texas Legislature. TDMHMR or its designee adjusts reimbursement if new 
legislation, regulations, or economic factors affect costs, as specified in 
sec.409.006 of this title (relating to Adjusting Rates when New Legislation, 
Regulations, or Economic Factors Affect Costs). 
   
  (C) Reimbursement determination. For each type of rehabilitative service each 
provider's cost per unit of service is calculated. The mean provider cost per 
unit of service is calculated, and the statistical outliers (those providers 
whose unit costs exceed plus or minus () two standard deviations of the mean 
provider cost) are removed. After removal of the statistical outliers, the mean 
cost per unit of service is calculated. This mean cost per unit of service 
becomes the recommended reimbursement per unit of service as of May 20, 1995. 
   
  (D) Reimbursement setting authority. The Texas Board of Mental Health and 
Mental Retardation establishes the reimbursement in an open meeting after 
consideration of financial and statistical information and public testimony. The 
Board sets reimbursements that, in its opinion, are within budgetary 
constraints, adequate to reimburse the cost of operations for an economic and 
efficient provider, and justifiable given current economic conditions. 
   
  (E) Reviews of cost report disallowances. A provider agency may request 
notification of the exclusions and adjustments to reported expenses. made during 
either desk reviews or on-site audits, according to sec.409.005 of this title 
(relating to Notification). Providers may request an informal review and, if 
necessary, an administrative hearing to dispute the action taken by TDMHMR or 
its designee under sec.409.007 of this title (relating to Reviews and 
Administrative Hearings). 
   
  (F) Requirements for allowable costs. Allowable costs must be: 
 
  (i) Necessary and reasonable for the proper and efficient administration of 
rehabilitative services for which TDMHMR or its designee has contracted; 
   
  (ii) Authorized or not prohibited under state or local laws or regulations; 
   
  (iii) Consistent with any limitations or exclusions described in this section, 
federal or state laws, or other governing limitations as to types or amounts of 
cost items; 
   
  (iv)  Consistent with policies, regulations, and procedures that apply to both 
rehabilitative services and other activities of the organization of which the 
contracted agency is a part; 
   
  (v) Treated consistently using generally accepted accounting principles 
appropriate to the circumstances; 
   
  (vi) Not allowable to or included as a cost of any other program in either the 
current or a prior period; and 
   
  (vii) Net of all applicable credits. 
     
  (G) Reasonableness. A cost is reasonable if, in its nature and amount, it does 
not exceed that which would be incurred by an ordinarily prudent person in the 
conduct of competitive business. In determining the reasonableness of a given 
cost, TDMHMR or its designee considers the following: 
 
  (i) whether the cost is of a type generally recognized as ordinary and 
necessary for the provision of rehabilitative services or the performance under 
the contract; 
   
  (ii)  the restraints or requirements imposed by generally accepted sound 
business practices, arm's length bargaining, federal and state laws and 
regulations, and contract terms and specifications; and 
   
  (iii) the action that a prudent person would take in the circumstances, 
considering his responsibilities to the public, the government, his employees, 
clients, shareholders, and/or members, and the fulfillment of the purpose for 
which the business was organized. 
     
  (H) List of allowable costs. The following list of allowable costs is not 
comprehensive but rather serves as a general guide and serves to clarify certain 
key expense areas. The absence of a particular cost does not necessarily mean it 
is not an allowable cost. The following are allowable costs: 
 
  (i) Advertising expenses (employee recruitment, in the yellow pages and to 
meet regulatory requirements); 
   
  (ii) Automatic data processing equipment leasing expenses; 
   
  (iii) Bonding expenses; 
   
  (iv) Civil defense expenses; 
   
  (v) Compensation for personal services, including back pay; 
   
  (vi) Cost of money (interest); 
   
  (vii) Depreciation; 
   
  (viii) Economic planning (allowable only as an indirect cost); 
   
  (ix) Employee morale, health, welfare, food service and dormitory expenses and 
credit; 
   
  (x) Fringe benefits; 
   
  (xi) Insurance and indemnification; 
   
  (xii) Labor relations expenses; 
   
  (xiii) Maintenance and repair; 
   
  (xiv) Material and supply cost; 
   
  (xv) Patent expenses; 
   
  (xvi) Pension plans; 
   
  (xvii) Plant protection expenses; 
   
  (xviii) Recruitment expenses; 
   
  (xix) Relocation expenses; 
   
  (xx) Rental expenses; 
   
  (xxi) Service and warrant expense; 
   
  (xxii) Severance pay; 
   
  (xxiii) Special tooling and special test equipment expenses; 
   
  (xxiv) Termination expenses; 
   
  (xxv) Business, technical and professional activity expenses related to 
rehabilitative services; 
   
  (xxvi) Training and educational expenses; 
   
  (xxvii) Transportation expenses; 
   
  (xxviii) Travel expenses; 
   
  (xxix) Utilities; 
   
  (xxx) Utilization review committee. 
     
  (I) Unallowable Costs. The following list of unallowable costs is not 
comprehensive, but rather serves as a general guide and clarifies certain key 
expense areas. The absence of a particular cost does not necessarily mean that 
it is an allowable cost. The following are unallowable costs: 
 
  (i) Alcoholic beverage expenses; 
   
  (ii) Bad debts and directly associated collection and legal costs; 
   
  (iii) Bid and proposal costs in excess of a set limit; 
   
  (iv) Board of directors fees; 
   
  (v)  Congressional lobbying; 
   
  (vi) Contingency provisions as such; 
   
  (vii) Contributions and donations; 
   
  (viii)  Entertainment expenses; 
   
  (ix) Executive lobbying costs; 
   
  (x) Fines and penalties for violations of regulations, statutes and ordinances 
of all types; 
   
  (xi) First class air travel unless authorized under specific circumstances and 
documented and justified; 
   
  (xii) Goodwill (acquired); 
   
  (xiii) Gains or losses on disposition of capital assets other than depreciable 
assets; 
   
  (xiv) Idle facility costs except in limited circumstances; 
   
  (xv) Independent research and development costs beyond set limits; 
   
  (xvi) Insurance, retroactive or backdated; 
   
  (xvii) Interest costs for operating funds; 
   
  (xviii) Legal fees defending fraud (and litigating appeals against the 
government); 
   
  (xix) Long term leases of property and equipment and leases from related 
parties are limited to the costs of ownership; 
   
  (xx) Losses on other contracts; 
   
  (xxi) Organization expenses; 
   
  (xxii) Product advertising; 
   
  (xxiii) Professional service costs to prosecute claims against the U.S.; 
   
  (xxiv) Promotional and fund raising expenses; 
   
  (xxv) Social club memberships; 
   
  (xxvi) Stock options and some forms of deferred compensation; 
   
  (xxvii) Trade discounts of all types (returns, allowances and refunds); 
   
  (xxviii) Certain taxes. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on September 22, 1995. 
 TRD-9512158 
  Ann Utley 
 Chairman, Texas MHMR Board 
 Texas Department of Mental Health and Mental Retardation 
    Effective date: October 13, 1995 
 Proposal publication date: August 1, 1995 
 For further information, please call: (512) 206-4516 
         
                   
  Subchapter J. Reimbursement for Services in Institutions for Mental Diseases 
(IMD) 
 
  25 TAC sec.sec.409.371-409.380 
 
  The Texas Department of Mental Health and Mental Retardation (TDMHMR) adopts 
new sec.sec.409.371-409.380, concerning reimbursement for services in 
institutions for mental diseases (IMD). Sections 409.372-409.376 and 409.379 are 
adopted with changes to the proposed text as published in the July 28, 1995, 
issue of the Texas Register (20 TexReg 5594). Sections 409.371, 409.377, 
409.378, and 409.380 are adopted without changes to the proposed text. 
 Throughout the subchapter "institution for mental disease" was changed from 
singular to plural; additionally, necessary punctuation and language were added 
and unnecessary language was deleted. The definition of "institution for mental 
diseases" was modified to identify the delivery of psychiatric diagnosis and 
treatment, and the inclusion of care of persons with mental illness. A 
definition of "single state agency" was added. In sec.409.374, language was 
added to clarify that an acceptable alternative placement is determined by the 
individual's treatment team. Also in sec.409.374, language was deleted that 
referred to initial authorization and re-authorization. 
 In sec.409.375(a)(1)(D), the term "involuntary admissions" was changed to 
"persons involuntarily committed for inpatient mental health treatment under the 
Texas Health and Safety Code, Chapters 573 and 574" for clarification. In 
(a)(2)(A)(iii), language was added that identified the single state agency as 
having access to the institution, patients, and patients' records in accordance 
with federal regulations. In sec.409.375(c)(3), the term "health care" was 
clarified to mean the patient's mental and physical health care. In 
sec.409.375(d), the term "inspection team" was changed to "medical review team" 
for consistency. Notice of termination of reimbursement for IMD services in 
sec.409.376(b) was clarified as written notice. Language in sec.409.376(b)(6) 
clarifies that the single state agency has the option of not participating in 
reimbursement for IMD services. In sec.409.377(b), the fractions with a 
denominator of 17 was changed to 12 to correct a mathematical error. In the same 
subsection language was added that addressed the possibility of the median 
average per diem falling between two providers. The reference section was 
updated to reflect an additional reference. 
 Public comment was received from Advocacy, Inc. A public hearing was held on 
August 17, 1995; no one attended the hearing and no oral or written testimony 
was presented. 
 The commenter believed the definition of "institution for mental diseases" did 
not sufficiently indicate that the IMD is expected to provide ongoing, 
aggressive psychiatric treatment for persons with mental illness. The department 
responds by modifying the definition to reflect the commenter's concerns. 
 Regarding sec.409.374(3), the commenter wondered how and by whom a 
determination of acceptable alternate placement would be made, asking if the 
lack of a vacancy at an acceptable alternate placement would constitute 
continued delivery of IMD services to the person. The department responds that 
language was added to clarify that the individual's treatment team determines 
acceptable alternate placement. Available alternate placement is not a 
consideration in the discharge criteria described in sec.409.378. 
 The commenter questioned what criteria would be used to base the decision 
regarding the need for inpatient hospitalization, asking if the availability of 
alternate community-based placement would impact that decision. The department 
responds that Chapter 402, Subchapter A (relating to Admissions, Transfers, 
Absences, and Discharges-Mental Health Facilities) and Chapter 401, Subchapter J 
(relating to Standards of Care and Treatment in Psychiatric Hospitals) describe 
the criteria for admission. Also, the Texas Health and Safety Code, Chapter 574, 
describes the criteria for court-ordered commitments. The availability of 
alternate community-based placement would not have an impact on the decision. 
 The commenter expressed concern regarding the re-authorization of continued 
stay, questioning if the monitoring process ensures that it was not just a 
procedure in which the physician routinely signs a form every 30 days. The 
commenter requested that re-authorization involve and provide a monitoring 
process. The department responds that this subchapter addresses only the 
reimbursement  for IMD services. It does not govern the standards of care and 
treatment or the necessity for IMD services. The department determined that 
statements referring to initial authorization and re-authorization were not 
appropriate for this subchapter and deleted the language. All rules and 
regulations regarding admissions to, continued stay in, and discharge from 
psychiatric hospitals apply to individuals from whom Medicaid reimbursement in 
an IMD may be authorized. 
 The commenter requested clarification on the term "involuntary admissions" in 
sec.409.375(a)(1)(D). The department responds by replacing the term with the 
following language: "persons involuntarily committed for inpatient mental health 
treatment under the Texas Health and Safety Code, Chapters 573 and 574. " 
 The commenter requested that the language "as related to both treatment and 
placement alternatives" be added to sec.409.375(a)(2)(A)(ii). The department 
responds that it does not want to limit the types of alternative methods of care 
an IMD could develop. 
 Regarding sec.409.375(c), the commenter suggested no advance notice (or as 
little as possible) be given to the facility for visits by the medical review 
team. The commenter made this suggestion so that the medical review team could 
inspect the normal day-to-day workings of the facility. The department responds 
that the medical review team inspects compliance with the elements described in 
subsection (a), as well as the adequacy of services being provided to patient's 
for whom Medicaid reimbursement is made for IMD services, the need for the 
patient's continued stay, and the feasibility of meeting the patient's needs 
through alternate care. Federal regulations prohibit announcements more than 48 
hours in advance of a visit. The department does not agree that a more 
restrictive standard is required at this time, however, the department has the 
authority to conduct unannounced visits for reasonable cause. 
 The new sections are adopted under the Texas Health and Safety Code, Title 7, 
sec.532.015, which provides the Texas Board of Mental Health and Mental 
Retardation with rulemaking powers; and under the provisions of Texas Civil 
Statutes, Article 4413(502) sec.16, which provides the Health and Human Services 
Commission with the authority to administer federal medical assistance funds. 
 
 
  sec.409.372. Application.  This subchapter applies to institutions for mental 
diseases. 
 
   
  sec.409.373. Definitions.  The following words and terms, when used in this 
subchapter, have the following meanings, unless the context clearly indicates 
otherwise. 
   
     Department-The Texas Department of Mental Health and Mental Retardation 
(TDMHMR) or its designee. 
   
     Inpatient hospital services-Services provided under the supervision of a 
physician in an IMD that meet the requirements for psychiatric hospitals in 42 
Code of Federal Regulations, sec.482.60(b), (c), and (d) and meet certain 
utilization review requirements in 42 Code of Federal Regulations, 
sec.482.30(a), (b), (d), and (e) unless the utilization review requirements have 
been waived pursuant to 42 Code of Federal Regulations, sec.440.140. 
   
     Institution for mental diseases (IMD)-A hospital of more than 16 beds that 
is primarily engaged in providing psychiatric diagnosis, treatment, and care of 
persons with mental diseases, including medical care, nursing care, and related 
services. 
   
     IMD provider-A provider who has a provider agreement with the department 
and is receiving reimbursement for IMD services. 
   
     IMD services-Inpatient hospital services provided by an eligible IMD 
provider for the care and treatment (including room and board) of individuals 
with mental diseases including, but are not limited to: 
 
  (A)  initiation, titration, or change in medication; 
   
  (B) monitoring and assessing by qualified mental health professionals; 
   
  (C) suicide precautions; 
   
  (D) redirection of inappropriate behaviors and/or reinforcement of appropriate 
behaviors; 
   
  (E) group and individual therapies; 
   
  (F) structured skills training activities; and 
   
  (G)  nursing services. 
     
     Medical review team-A team designated by TDMHMR Office of Medicaid 
Administration, that includes at least one physician, as prescribed by 42 Code 
of Federal Regulations,  sec.456.602, who is familiar with the care of mentally 
ill individuals. No team member may be employed by or have a significant 
financial interest in the facility under review. 
   
     Mental diseases -Diseases listed as mental disorders in the International 
Classification of Diseases, Ninth Edition, modified for clinical applications 
(ICD-9-CM), with the exception of mental retardation and chemical dependency 
disorders. 
   
     Qualified mental health professional-A person acting within the scope of 
his or her training and licensure or certification, who is a: 
 
  (A) certified or licensed social worker as defined by the Human Resources 
Code, sec.50.001; 
   
  (B) licensed professional counselor as defined by the Licensed Professional 
Counselor Act, sec.2 (Texas Civil Statutes, Article 4512g); 
   
  (C) physician who is "practicing medicine" as defined by the Medical Practice 
Act, sec.1.03 (Texas Civil Statutes, Article 4495b) or a person employed by any 
agency of the United States having a license to practice medicine in any state 
of the United States; 
   
  (D)  registered nurse as defined in the Nurse Practice Act (Texas Civil 
Statutes Article 4518, sec.5); or 
   
  (E) psychologist offering "psychological services" as defined by the 
Psychologists' Certification and Licensing Act, sec.2 (Texas Civil Statutes, 
Article 4512c). 
     
     Single state agency-The Texas Health and Human Services Commission or its 
designee. 
 
   
  sec.409.374. Eligible Population.  Reimbursement for IMD services is limited 
to individuals: 
 
  (1) who are age 65 years or older; 
   
  (2) who have one or more mental diseases; 
   
  (3) who have no acceptable alternate placement as determined by the 
individual's treatment team; 
   
  (4) who are eligible for participation in the Texas Medicaid program; 
   
  (5) who are not eligible for medical compensation from other payment sources; 
   
  (6) who have been certified by a licensed physician to need inpatient 
hospitalization for the care and treatment of a mental disease; 
   
  (7) who meet all other federal, state and local regulations applicable to 
admission to a mental hospital; and 
   
  (8) for whom the department has authorized IMD services based on medical 
necessity. 
 
     
  sec.409.375. Provider Eligibility for Reimbursement. 
 
  (a) To be eligible for reimbursement for IMD services, a provider must: 
 
  (1)  submit an approved application for enrollment through means established 
by TDMHMR, Office of Medicaid Administration, to include evidence that the 
provider: 
 
  (A) meets the Medicare conditions of participation specified in 42 Code of 
Federal Regulations, sec.482.60; 
   
  (B) is accredited by the Joint Commission on Accreditation of Healthcare 
Organizations; 
   
  (C) if applicable, licensed by the state as a psychiatric hospital under the 
provision of the Texas Health and Safety Code, Chapter 577; and 
   
  (D) has a consistent historical pattern of accepting persons involuntarily 
committed for inpatient mental health treatment under the Texas Health and 
Safety Code, Chapters 573 and 574, during a two-year period prior to application 
for participation. 
     
  (2) have in effect a written provider agreement with the department which: 
 
  (A) describes respective responsibilities of the provider and the department's 
Office of Medicaid Administration, including arrangements to ensure: 
 
  (i)  joint planning efforts; 
   
  (ii) development of alternative methods of care; 
   
  (iii) access by the single state agency to the institution, its patients, and 
patients' records when necessary to carry out the agency's responsibilities in 
accordance with 42 Code of Federal Regulations,  sec.431.107; 
   
  (iv) recording, reporting, and exchanging medical and social information about 
the patients; and 
   
  (v)  other procedures that may be required to achieve the purposes of the 
agreement; 
     
  (B) assures the capacity of the provider to admit, readmit from alternate 
care, and treat both eligible persons voluntarily seeking services under the 
Texas Health and Safety Code, Chapter 572 and persons involuntarily committed 
for inpatient mental health treatment under the Texas Health and Safety Code, 
Chapters 573 and 574; 
   
  (C) assures that the provider is meeting the requirements specified in 42 Code 
of Federal Regulations, sec.440.140(a) pertaining to providers of inpatient 
hospital services in institutions for mental diseases; 
   
  (D) assures that the provider is in compliance with those provisions of the 
Texas Administrative Code, Title 25, Part II, Chapters 401, 402, 403, 404, 405 
and 408 that relate to patient care and treatment in inpatient mental health 
facilities; 
   
  (E)  assures that the provider is serving a patient population in which more 
than 50% currently require institutionalization because of a mental disease; and 
   
  (F) assures that the provider will submit cost reports and audit data in a 
manner authorized by the department. 
       
  (b) A provider's eligibility for reimbursement must be renewed periodically at 
a time designated by the department's Office of Medicaid Administration, but not 
to exceed two years. 
   
  (c) Evidence of compliance with subsection (a) of this section will be 
validated through onsite inspections by a medical review team designated by the 
TDMHMR Office of Medicaid Administration. Inspections will occur at an interval 
decided upon by the department and the team but no less than annually. No 
facility may be notified more than 48 hours before the scheduled arrival of the 
team. For each Medicaid patient, the team will additionally review: 
 
  (1) the adequacy of services available to meet the patient's current health 
needs and promote the patient's maximum physical well-being; 
   
  (2) the necessity or desirability of the patient's continued placement in the 
facility; and 
   
  (3) the feasibility of meeting the patient's mental and physical health care 
needs through alternative institutional or non-institutional care. 
     
  (d) If the provider fails to provide evidence of compliance with subsection 
(c)(1)-(3) of this section, then the provider must take corrective action, as 
needed, based on the findings in the medical review team's report. 
 
  (1) If the provider fails to take corrective action, recoupment of medicaid 
funds associated with the finding(s) will be initiated as provided for in 
Chapter 409, Subchapter C (relating to Fraud and Abuse and Recovery of Funds). 
   
  (2) Recoupment is an adverse action for which the provider is entitled to an 
administrative hearing in accordance with Chapter 409, Subchapter B of this 
title (relating to Adverse Actions). 
 
       
  sec.409.376. Provider Reimbursement. 
 
  (a) Reimbursement for IMD services provided to eligible individuals begins on 
the date established by written notice from the department's Office of Medicaid 
Administration and is contingent upon validation of evidence of provider 
eligibility as described in sec.409.375(c) of this title (relating to Provider 
Eligibility for Reimbursement). 
   
  (b) Provider reimbursement for IMD services is subject to termination with 
written notice on the date that any of the following occurs: 
 
  (1) loss of Medicare and/or JCAHO certification; 
   
  (2) if applicable, loss of licensure as a psychiatric hospital; 
   
  (3) failure to meet requirements specified in 42 Code of Federal Regulations, 
sec.440.140(a) pertaining to providers of inpatient hospital services in 
institutions for mental diseases; 
   
  (4) demonstrated noncompliance with those provisions of the Texas 
Administrative Code, Title 25, Part II, Chapters 401, 402, 403, 404, 405, and 
408 that relate to patient care and treatment in inpatient mental health 
facilities, or with state laws governing admission and treatment; 
   
  (5) breach of the written provider agreement described in sec.409.375(a)(2) of 
this title (relating to Provider Eligibility for Reimbursement); or 
   
  (6) termination of participation by the single state agency in the 
reimbursement for services in IMD Medicaid program. 
     
  (c) Failure to submit an acceptable cost report in the cost report time frame 
constitutes an administrative contract violation, which could result in a hold 
of vendor payments. 
   
  (d) Termination of provider reimbursement or being placed on vendor hold are 
adverse actions for which the provider is entitled to an administrative hearing 
in accordance with Chapter 409, Subchapter B of this title (relating to Adverse 
Actions). 
   
  (e) Providers who receive Medicaid reimbursement for IMD services are governed 
by Chapter 409, Subchapter C of this title (relating to Fraud and Abuse and 
Recovery of Funds). 
 
     
  sec.409.379. References.  The following laws and rules are referred to in this 
subchapter: 
 
  (1) 42 Code of Federal Regulations, sec.sec.482.60, 482.30, 431.620, 440.140, 
and 431.107; 
   
  (2) Human Resources Code, sec.50.001; 
   
  (3) Texas Civil Statutes, Articles 4495b, 4512c, 4512g, and 4518, sec.5; 
   
  (4) Texas Health and Safety Code, Chapters 572-574 and 577; 
   
  (5) those provisions in Chapters 401-405 and 408 of this title, which relate 
to patient care and treatment in inpatient mental health facilities; and 
   
  (6) Chapter 409, Subchapter B of this title (relating to Adverse Actions); and 
   
  (7) Chapter 409, Subchapter C of this title (relating to Fraud and Abuse and 
Recovery of Funds). 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on September 22, 1995. 
 TRD-9512157 
  Ann Utley 
 Chairman, Texas MHMR Board 
 Texas Department of Mental Health and Mental Retardation 
    Effective date: October 13, 1995 
 Proposal publication date: July 28, 1995 
 For further information, please call: (512) 206-4516 
         
                   
  TITLE 28. INSURANCE 
 Part I. Texas Department of Insurance 
  Chapter 25. Insurance Premium Finance 
  
  Subchapter A. General Provisions 
 
  28 TAC sec.25.9 
 
  The Commissioner of Insurance adopts an amendment to sec.25.9, requiring 
insurance premium financing information to be disclosed to consumers in both 
English and Spanish, without changes to the proposed text as published in the 
August 18, 1995, issue of the Texas Register (20 TexReg 6295). 
 Amended sec.25.9 will make the premium financing information already required 
to be disclosed by sec.25.9 available in Spanish as well as English. Amended 
sec.25.9 also adopts by reference an amended Premium Finance Comparison 
Disclosure Form (disclosure form) for use by all insurance premium finance 
companies subject to Chapter 25 of the Administrative Code and the Insurance 
Code, Chapter 24. The amended disclosure form contains premium financing 
information in English, followed by the same information translated into 
Spanish. 
 Amended sec.25.9 is necessary to provide for disclosure of premium financing 
information to more insurance consumers, those speaking either English or 
Spanish. The amended section will enable a greater number of consumers to make 
more informed decisions when financing insurance premiums. 
 For: Consumers Union. For with changes: Office of Public insurance Counsel. 
With suggested changes: National IPF Company doing business as Emerald Finance 
Company. 
 Comment: One commenter strongly supports amended sec.25.9. The commenter states 
that requiring the disclosure form to be in both English and Spanish is 
necessary to bring pertinent financing information to the large number of 
Spanish-speaking Texans so that they may make informed decisions. 
 Agency Response: The department agrees. 
 Comment: Another commenter strongly supports the amendment to sec.25.9. 
However, the commenter was concerned about the wording of the notice segment of 
the disclosure form. The commenter argues that the use of the word 
"installments" to refer to both the Texas Automobile Insurance Plan Association 
(TAIPA) installment payment plan and the premium finance payment plan is 
confusing. The commenter suggests that the department substitute its proposed 
language for the notice paragraph in lieu of the proposed language. The 
commenter also argues that the signature line may be confusing, i.e. that 
consumers may believe it is necessary to sign the form to get either payment 
option. The commenter suggests it would be clearer to have two signature blocks, 
each directly below the payment option to which it refers. 
 Agency Response: The department disagrees. The word "installment" is used in 
connection with the premium finance payment plan only once when describing that 
the consumer repays the premium finance company in installments. Since this is 
precisely what happens, this is an accurate statement. The focus of the 
disclosure form is to provide consumers with a balanced and accurate picture of 
the payment options available to them. The fact is that both TAIPA and insurance 
premium finance companies allow consumers to pay their insurance premiums in 
installments over time. The disclosure form simply allows consumers to compare 
the differences in the costs of each payment option. The department also 
disagrees with the suggestion that the form have two signature blocks. The 
inclusion of two signature boxes is potentially confusing in itself. The 
signature block clearly states that consumers are to sign the form if they 
choose the premium finance payment option. 
 Comment: A commenter asserts that, as used in the language of the disclosure 
form, the meaning of the term "deposit premium" is unclear. The commenter 
asserts that the term might include a premium paid to an insurer by an insurance 
premium finance company on behalf of the insured. The commenter concludes that 
this might reduce the amount of unearned premium (in which the insurance premium 
company has a security interest) and allow the insurer to retain funds, which 
might reduce the insurance premium finance company's security interest. 
 Agency Response: The department disagrees. The use of the term "deposit 
premium" must be considered in context. The notice to applicants on the 
disclosure form states that applicants, with certain exceptions, are eligible to 
pay their insurance premium through TAIPA's monthly installment plan. The 
exceptions to the eligibility are listed at the bottom of the disclosure form 
and state: that TAIPA's installment plan is not available for commercial 
automobile policies; and, that an insurer assigned through TAIPA has a right to 
offset any premiums it is owed. These provisions apply only to those applicants 
who want to use TAIPA's installment payment plan. In other words, the insurer's 
right to offset would not apply to premiums financed through an insurance 
premium finance company. The offset is only triggered if the consumer owes for a 
previous default in premium, but desires to use the TAIPA installment payment 
plan. 
 The amendment is adopted pursuant to the Insurance Code, Articles 24.09 and 
1.03A, and the Government Code, sec.sec.2001.004 et seq (Administrative 
Procedure Act). Article 24.09 authorizes the Texas Department of Insurance to 
adopt and enforce rules necessary to carry out the provisions of Chapter 24 
(regulating insurance premium finance companies). Article 1.03A provides that 
the Commissioner of Insurance may adopt rules and regulations to execute the 
duties and functions of the Texas Department of Insurance only as authorized by 
a statute. The Government Code, sec.sec.2001.004 et seq, authorize and require 
each state agency to adopt rules of practice setting forth the nature and 
requirements of available procedures and to prescribe the procedures for 
adoption of rules by a state agency. 
 The following article is affected by this proposal: Insurance Code, Chapter 24. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on September 22, 1995. 
 TRD-9512216 
  Alicia M. Fechtel 
 General Counsel and Chief Clerk 
 Texas Department of Insurance 
    Effective date: October 15, 1995 
 Proposal publication date: August 18, 1995 
 For further information, please call: (512) 463-6327 
         
               
  TITLE 30. ENVIRONMENTAL QUALITY 
 Part I. Texas Natural Resource Conservation Commission 
  Chapter 335. Industrial Solid Waste and Municipal Hazardous Waste 
  
  Subchapter J. Industrial Solid Waste and Hazardous Waste Fee System 
 
  30 TAC sec.335.325, sec.335.326 
 
  The Texas Natural Resource Conservation Commission adopts amendments to 
sec.335.325 and sec.335.326, concerning industrial solid waste and hazardous 
waste fee system, without changes to the proposed text as published in the April 
28, 1995, issue of the Texas Register (20 TexReg 3129). The Texas Health and 
Safety Code, Chapter 361, Subchapter D authorizes the commission to establish an 
industrial solid waste and hazardous waste fee system related to the generation 
and disposition of waste and the operation of waste management facilities 
subject to permits. Under the current fee program, monthly waste management fees 
are assessed based on the actual amounts of waste which are treated, stored or 
disposed at permitted facilities. Under provisions of the Texas Health and 
Safety Code, sec.361.136(c), these waste management fees are based on the total 
weight of the amounts of waste managed, except for wastes which are disposed in 
underground injection wells, which are based on the dry weight of the waste. The 
Texas Health and Safety Code, sec.361.131 defines dry weight to be the weight of 
waste stream constituents other than water. The Texas Health and Safety Code, 
sec.361.136(m) authorizes the commission to establish by rule a method for 
computing the dry weight of a waste. 
 Some companies generate waste streams that significantly exceed the average for 
dry weight ratios of injected waste streams due to the presence of naturally-
occurring brines at high concentrations. The rules as adopted will mitigate the 
impact of the highly saline waste streams on fee calculations by assessing a 
lower fee for the brine component of wastes above a threshold dry weight 
measure. The commission also adopts alternative procedures for the determination 
of the dry-weight measurement of hazardous wastes which are high in inorganic 
salts or brines. 
 Comments on the proposed rules were received from the Texas Chemical Council 
and BP Chemicals. The Texas Chemical Council supported the proposed amendments. 
BP Chemicals requested that the proposed rule be amended to adopt a lower 
threshold for dry-weight at which the reduced fee rate would become effective in 
order to increase the incentives for implementation of waste reduction efforts 
which typically reduce the volumes of wastewater and increase the concentrations 
of dissolved solids. A threshold of 8.0% was recommended as an alternative to 
the 10% proposed by the commission. The commission recognizes the efforts being 
made industry-wide to reduce waste stream volumes and acknowledges that these 
efforts will have implications for the concentration of aqueous waste streams 
and the relative cost per unit of volume for disposal fee payments. It must also 
be recognized, however, that because fees for injections wells are based solely 
on dry weight, fee payments do not increase with the relative concentration of 
solids in the waste stream as a result of waste reduction efforts. In addition, 
the proposed amendment to the rules is intended to address a limited number of 
circumstances where relatively small quantities of waste significantly differ 
from the norm and result in fee payments that are inconsistent with the volumes 
of waste involved and the size of the affected facilities. To broaden the 
application of this rule would have revenue implications for agency programs 
that cannot be determined at this time, but which, if significant, would likely 
require adjustments to disposal fee rates for all injection well operators in 
order to maintain adequate financial support of programs. For these reasons, the 
suggested change to the proposal has not been adopted. The Texas Chemical 
Council also commented on two errors in the preamble to the proposed rules. 
Paragraph three of the preamble refers incorrectly to sec.335.135 rather than 
sec.335.325 which is being amended. The section is correctly numbered as 
sec.335. 325 in the body of the adopted rule. Also, the proposal refers to an 
amendment to sec.335.325(j) which changed a reference in the subsection to 
include the proposed new subsection (q) in that section. Although the new 
sec.335.325(q) was published and now adopted, the amended sec.335.325(j) was 
inadvertently omitted from the publication. As soon as practicable, the 
commission will submit a proposal which will include publication of the 
amendment to sec.335. 325(j) that correctly refers to the new subsection (q). 
 The amendments are adopted under the Texas Health and Safety Code, Chapter 361, 
which provides the Texas Natural Resource Conservation Commission with the 
authority to establish an industrial solid waste and hazardous waste fee program 
and implement fee assessments for industrial solid waste and hazardous waste 
generators, waste management facilities and permit applicants. 
 The sections will implement provisions of the Texas Health and Safety Code, 
sec.sec.361.131, 361.136, and 361.139. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on September 22, 1995. 
 TRD-9512251 
  Kevin McCalla 
 Director, Legal Division 
 Texas Natural Resource Conservation Commission 
    Effective date: October 16, 1995 
 Proposal publication date: April 28, 1995 
 For further information, please call: (512) 239-6087 
         
               
  TITLE 34. PUBLIC FINANCE 
 Part III. Teacher Retirement System of Texas 
  Chapter 29. Benefits 
  
  Retirement 
 
  34 TAC sec.29.11 
 
  The Teacher Retirement System of Texas (TRS) adopts an amendment to sec.29. 
11, without changes to the proposed text as published in the August 15, 1995, 
issue of the Texas Register (20 TexReg 6198). 
 The changes in the section are necessary to adopt by reference the actuarial 
tables needed to implement recent statutory changes to early age retirement 
benefits, retirement benefits, and disability retirement benefits offered by 
TRS. 
 The amendment will provide TRS with actuarial tables for calculating service 
retirement allowing an additional joint survivor benefit option. Also the new 
tables update the early age reduction factors to reflect a statutory amendment 
that will allow early age retirement at age 50 with 30 years of service without 
a reduction in retirement benefits. 
 No comments were received regarding adoption of the amendment. 
 The amendment is adopted under the Texas Government Code, sec.825.102, which 
provides the Board of Trustees of the Teacher Retirement with the authority to 
adopt rules for membership eligibility, the administration of the funds of the 
retirement system and the transaction of its business; sec.825.105, which 
authorizes the board to adopt actuarial tables for benefit calculation. 
 
 
  sec.29.11. Actuarial Tables.  Actuarial tables furnished by Watson Wyatt 
Worldwide, Consulting Actuaries, will be used for computation of benefits. 
Factors for ages or types of annuities not included in the tables will be 
computed from the same data by the same general formulas. The Teacher Retirement 
System adopts by reference the Watson Wyatt Company's June 1995, factors for 
retirement options and the early age reduction factors based on 8. 0% interest. 
These actuarial tables shall be effective beginning September 1, 1995. The 
Teacher Retirement System also adopts by reference Watson Wyatt Worldwide's June 
1995, factors for disabled member retirement options based on 8.0% interest. 
These actuarial tables shall be effective beginning September 1, 1995. The board 
of trustees may change the tables or adopt new tables from time to time by 
amending this section; provided however, that any such change does not result in 
any member receiving a smaller benefit than the benefit computed immediately 
before the change. Information regarding and/or copies of these tables may be 
obtained by contacting Teacher Retirement System of Texas, 1000 Red River 
Street, Austin, Texas 78701-2698, (512) 397-6400. 
 
  This agency hereby certifies that the rule as adopted has been reviewed by 
legal counsel and found to be a valid exercise of the agency's legal authority. 
 Issued in Austin, Texas, on September 21, 1995. 
 TRD-9512140 
  John R. Mercer 
 Interim Executive Director 
 Teacher Retirement System of Texas 
    Effective date: October 13, 1995 
 Proposal publication date: August 15, 1995 
 For further information, please call: (512) 370-0506