PROPOSED 
 RULES 
 
 Before an agency may permanently adopt a new or amended section or repeal an 
existing section, a proposal detailing the action must be published in the  
Texas Register at least 30 days before action is taken. The 30-day time period 
gives interested persons an opportunity to review and make oral or written 
comments on the section. Also, in the case of substantive action, a public 
hearing must be granted if requested by at least 25 persons, a governmental 
subdivision or agency, or an association having at least 25 members. 
  Symbology in proposed amendments. New language added to an existing section is 
indicated by the use of  bold text. [Brackets] indicate deletion of existing 
material within a section. 
 
   
  TITLE 1. ADMINISTRATION 
 Part II. Texas Ethics Commission 
  Chapter 22. Restrictions on Contributions and Expenditures 
  
  1 TAC sec.22.32 
 
  The Texas Ethics Commission proposes new sec.22.32, concerning the retirement 
of campaign debt by certain judicial candidates and officeholders who are not 
running in the 1996 election and by their political committees. This section 
provides guidelines for those judicial candidates, officeholders, and political 
committees that qualify and that wish to accept political contributions to 
retire campaign debt incurred before June 16, 1995. It also prescribes 
procedures that must be followed by those judicial candidates, officeholders, 
and political committees before accepting political contributions under this 
section. 
 Karen Lundquist, General Counsel, has determined that for the first five-year 
period the section is in effect there will be no fiscal implications for state 
or local government as a result of enforcing or administering the section. 
 Ms. Lundquist also has determined that for each year of the first five years 
the section is in effect the public benefit expected as a result of adoption of 
the proposed rule is a better understanding of the procedures and restrictions 
applicable to certain judicial candidates, officeholders, and political 
committees that qualify and that wish to accept political contributions to 
retire campaign debt incurred before June 16, 1995. There is no economic cost to 
persons required to comply with the section. Ms. Lundquist also has determined 
that this section will have no local employment impact. 
 The Texas Ethics Commission invites comments on the proposed rule from any 
member of the public. A written statement should be mailed or delivered to Karen 
Lundquist, Texas Ethics Commission, P.O. Box 12070, Austin, Texas 78711-2070, or 
by facsimile (FAX) to (512) 463-5777. A person who wants to offer spoken 
comments to the commission concerning the proposed rule may do so at any 
commission meeting during the agenda item "Communication to the Commission from 
the Public" and during the public comment period at a commission meeting when 
the commission considers final adoption of the proposed rule. Information 
concerning the date, time, and location of commission meetings is available by 
telephoning (512) 463-5800 or, toll free in Texas, (800) 325-8506. 
 The new section is proposed under the Government Code, Chapter 571, sec.571. 
062, which authorizes the Texas Ethics Commission to adopt rules to implement 
laws administered and enforced by the commission; under sec.10(d), Chapter 763, 
Acts of the 74th Legislature, Regular Session, 1995 (relating to the effective 
date and application of Subchapter F, Chapter 253, Election Code); and under 
Election Code sec.253.035(h) (relating to Restrictions on Personal Use of 
Contributions), sec.253.151 (relating to Applicability of Subchapter), sec.253. 
153 (relating to Contribution Prohibited Except During Election Period), 
sec.253.155 (relating to Contribution Limits), sec.253.156 (relating to 
Contribution to Certain Committees Considered Contribution to Candidate), 
sec.253.157 (relating to Limit on Contribution by Member or General-Purpose 
Committee of Law Firm), sec.253.158 (relating to Contribution by Spouse or Child 
Considered to be Contribution by Individual), sec.253.159 (relating to Exception 
to Contribution Limits), sec.253.160 (relating to Aggregate Limit on 
Contributions From and Direct Campaign Expenditures by General-Purpose 
Committee), and sec.253.162 (relating to Restrictions on Reimbursement of 
Personal Funds and Payments on Certain Loans). 
 The new section affects Title 15, Election Code. 
 
 
  sec.22.32. Transitional Rule for Debt Retirement of Judicial Candidates and 
Officeholders Not Running in the 1996 Election. 
 
  (a) A judicial candidate or officeholder who is not running for election in 
1996, or a specific-purpose committee for supporting or opposing such a 
candidate or officeholder, may accept political contributions during the period 
beginning June 16, 1995, and continuing through March 5, 1997, for the purpose 
of retiring campaign debt incurred before June 16, 1995, as provided by this 
section. 
   
  (b) A judicial candidate or officeholder, or a specific-purpose committee for 
supporting or opposing a judicial candidate or officeholder, may not accept 
political contributions under subsection (a) unless the candidate or 
officeholder or the campaign treasurer of the specific-purpose committee has 
filed a sworn statement that includes the following information: 
 
  (1) the total amount of political contributions on hand when the statement is 
filed; 
   
  (2) the total amount of campaign debt existing on June 16, 1995; and 
   
  (3) the name and address of each person to whom a campaign debt is owed and 
the amount of that debt. 
     
  (c) The statement required by subsection (b) must be on a form prescribed by 
the commission and must be filed with the authority with whom the candidate's, 
officeholder's, or specific-purpose committee's campaign treasurer appointment 
is required to be filed. 
   
  (d) For purposes of this section, a candidate's or officeholder's campaign 
debt includes any reimbursement to which the candidate or officeholder is 
entitled under Texas Election Code, sec.253.035(h) for political expenditures 
made from personal funds. 
   
  (e) A candidate, officeholder, or specific-purpose committee accepting 
political contributions under this section may not accept political 
contributions in excess of the amount necessary to retire the existing campaign 
debt and to cover the costs incurred in soliciting political contributions to 
retire that debt. 
   
  (f) Political contributions accepted under this section are subject to the 
contribution limits imposed by the Judicial Campaign Fairness Act. 
   
  (g) The limits established by the Judicial Campaign Fairness Act on the use of 
political funds to reimburse political expenditures made from personal funds, or 
to repay loans from individuals related to the candidate or officeholder within 
the second degree by consanguinity, do not apply to political expenditures made 
to retire campaign debt incurred before June 16, 1995. 
   
  (h) This section applies to political contributions in connection with the 
offices of: 
 
  (1)  chief justice or justice, supreme court; 
   
  (2) presiding judge or judge, court of criminal appeals; 
   
  (3) chief justice or justice, court of appeals; 
   
  (4) district judge; 
   
  (5) judge, statutory county court; or 
   
  (6) judge, statutory probate court. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 25, 1996. 
 TRD-9605750 
  Tom Harrison 
 Executive Director 
 Texas Ethics Commission 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 463-5800 
         
                   
  TITLE 7. BANKING AND SECURITIES 
 Part I. State Finance Commission 
  Chapter 3. Banking Section 
  
  Subchapter B. General 
 
  7 TAC sec.3.22 
 
  The Finance Commission of Texas (the commission) proposes new sec.3.22, 
concerning sale or lease agreements between a state bank and an officer, 
director, manager, managing participant, principal shareholder, or principal 
participant of the bank, or an affiliate of the bank (insider). The proposed 
rule specifies the requirements for entering into these types of sale and lease 
agreements, including those requiring the prior approval of the banking 
commissioner. 
 Under Texas Civil Statutes, Article 342-4.107(a), if the approval of a 
disinterested majority of a state bank's board cannot be obtained, a state bank 
may not sell or lease an asset to an insider or purchase or lease an asset from 
an insider without the prior approval of the banking commissioner. However, 
under Texas Civil Statutes, Article 342-4.107(b), a state bank may not 
consummate, renew, or extend a lease involving real property in which an insider 
has an interest without the prior written approval of the banking commissioner. 
 The proposed rule requires a sale or lease agreement between a state bank and 
an insider to be in writing. The proposed rule also specifies the form and 
content of the written request which must be submitted to the banking 
commissioner if a state bank seeks to enter into a sale or lease agreement 
requiring the prior written approval of the banking commissioner. Finally, the 
proposed rule clarifies that subsection (c) is not applicable to a legally 
binding, written lease, entered into by a state bank prior to June 16, 1991, 
until such lease is renewed or extended beyond its original term. 
 The proposed rule will be applicable to trust companies under Texas Civil 
Statutes, Article 342-1102, sec.1. 
 Everette D. Jobe, General Counsel, Texas Department of Banking, has determined 
that for the first five-year period the section is in effect, there will be no 
fiscal implication for state or local government as a result of enforcing or 
administering the section. 
 Mr. Jobe also has determined that for each year of the first five years the 
section is in effect, the public benefit anticipated as a result of enforcing 
this section is the clarification of highly complex statutory standards to aid 
the industry in compliance. No net economic cost will result to persons required 
to comply with the proposed section. No difference will exist between the cost 
of compliance for small businesses and the cost of compliance for the largest 
businesses affected by this section. 
 Comments on the proposed section may be submitted in writing to Jerry Sanchez, 
Assistant General Counsel, Texas Department of Banking, 2601 North Lamar 
Boulevard, Austin, Texas 78705-4294. 
 The new section is proposed under Texas Civil Statutes, Article 342-1.012(a) , 
which authorize the commission to adopt rules to implement and clarify the Act, 
and to preserve or protect the safety and soundness of state banks. As required 
by Texas Civil Statutes, Article 342-1.012(b)(1),(2), the commission considered 
the need to promote a stable banking environment, provide the public with 
convenient, safe, and competitive banking services, and allow for economic 
development within this state. 
 Texas Civil Statutes, Article 342-4.107 and Article 342-1102, are affected by 
this proposed new section. 
 
 
  sec.3.22. Sale and Lease Agreements With an Officer, Director, Manager, 
Manager Participant, Principal Shareholder, Principal Participant, or Affiliate. 
 
  (a) A sale or lease agreement between a state bank and an officer, director, 
manager, managing participant, principal shareholder, or principal participant 
of the bank, or an affiliate, must be in writing. Existing verbal agreements 
must be reduced to writing and approved by the bank's board. 
   
  (b) A sale or lease agreement between a state bank and an officer, director, 
manager, managing participant, principal shareholder, or principal participant 
of the bank, or an affiliate, must be reasonable and equitable as to terms and 
rates, must comply with applicable laws and regulations, and must be consistent 
with prudent and sound banking principles. 
   
  (c) Pursuant to Texas Civil Statutes, Article 342-4.107, and subsection (e) of 
this section, if a sale or lease agreement requires the written approval of the 
banking commissioner prior to consummating, renewing, or extending the sale or 
lease agreement, a written request for approval must be submitted to the banking 
commissioner at least 60 days prior to the proposed effective date of the sale 
or lease agreement and must include the following information: 
 
  (1) A copy of the proposed sale or lease agreement; 
   
  (2) A complete description of the personal or real property to be sold or 
leased; 
   
  (3) A full disclosure of all existing transactions and/or relationships, 
whether direct or indirect, between the state bank and the parties involved; 
   
  (4) In the case of a lease agreement involving real property, a copy of the 
minutes of the board meeting reflecting an analysis of the information contained 
in this subsection; 
   
  (5) Copies of appropriate supporting documentation, including analysis of 
comparable terms and rates for the real or personal property to be sold or 
leased; 
   
  (6) In the case of a lease agreement, evidence demonstrating that the state 
bank will account for the lease in accordance with Financial Accounting 
Standards Board Statement No. 13; and, 
   
  (7) Other information which the banking commissioner may request. 
     
  (d) A state bank shall maintain the originals of all sale or lease agreements 
with an officer, director, manager, managing participant, principal shareholder, 
or principal participant of the bank, or an affiliate, which documents must be 
made available at all times to the Texas Department of Banking for examination 
and review. 
   
  (e) Subsection (c) of this section does not apply to a legally binding, 
written lease entered into by a state bank prior to June 16, 1991, until such 
lease is renewed or extended beyond its original term. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be a valid exercise of the agency's authority. 
 Issued in Austin, Texas, on April 26, 1996. 
 TRD-9605806 
  Everette D. Jobe 
 General Counsel, Texas Department of Banking 
 State Finance Commission 
    Proposed date of adoption: June 21, 1996 
 For further information, please call: (512) 475-1300 
         
               Chapter 4. Currency Exchange 
  
  Subchapter A. General 
 
  7 TAC sec.4.3 
 
  The Finance Commission of Texas (the commission) proposes an amendment to 
sec.4.3, concerning reporting and recordkeeping required under the Currency 
Exchange Act, Texas Civil Statutes, Article 350 (the Act). 
 The Act, sec.3(b), grants an exemption from its licensing requirement to 
persons holding a license under the Sale of Checks Act, Texas Civil Statutes, 
Article 489d. However, this exemption does not exempt a person that conducts 
currency exchange or transmission transactions from complying with the other 
provisions of the Act. A proposed change to sec.4.3 clarifies that licensees 
under the Act, as well as those exempt from licensing under the Act, sec.3(b), 
and those who otherwise engage in a currency exchange or currency transmission 
business, must comply with the Act's reporting and record-keeping provisions. 
 Other proposed amendments permit records required by the Act to be maintained 
outside Texas under certain conditions; more clearly outline specific reporting 
requirements; conform certain requirements that, at present, conflict with 31 
Code of Federal Regulations, sec.103.37; permit verification of customer 
identity under certain circumstances; change identity verification requirements; 
further specify circumstances under which multiple transactions are to be 
treated as a single transaction for recordkeeping and reporting purposes; expand 
methods of maintaining transaction receipt information; and provide exemptions 
from recordkeeping and reporting under this section. Changes are also proposed 
to achieve consistency between the dollar threshold for recordkeeping and 
reporting of currency transmission transactions with that for currency exchange 
transactions and to add certain requirements establishing the identity of the 
employee handling the transaction and the date of the transaction. Finally, 
other changes are proposed for clarification and consistency. 
 The department proposes an amendment to sec.4.3 in order to more clearly 
outline and refine the basic requirements for recordkeeping and reporting under 
the Act. Proposed amendments will better enable the examination process to flow 
efficiently and effectively and safeguard the rights and interests of customers 
of these industries and the general public. 
 Stephanie Newberg, Director, Special Audits Division, Texas Department of 
Banking, has determined that, for each year of the first five years the section 
is in effect, there will be no fiscal implications for state or local government 
as a result of enforcing or administering this section. 
 Ms. Newberg also has determined that, for each year of the first five years the 
section is in effect, the public benefit anticipated as a result of its adoption 
will be the clarification and streamlining of recordkeeping and reporting 
processes under the Act, enhanced protection of the rights and interests of 
industry customers and the public at large, and a more efficient and effective 
examination process. If adopted, the proposed amendments will enhance the 
orderly administration of the Act and ensure that the purposes of the Act, as 
they relate to recordkeeping and reporting are substantially fulfilled. No 
economic cost will be incurred by a person required to comply with this section, 
and there will be no effect on small businesses. 
 Comments on the proposed changes may be submitted in writing to Stephanie 
Newberg, Director of Special Audits, Texas Department of Banking, 2601 North 
Lamar Boulevard, Austin, Texas 78705-4294. 
 The amendment is proposed under the Act, sec.7, which authorizes the commission 
to adopt rules necessary to implement record-keeping and reporting requirements. 
 Texas Civil Statutes, Article 350, is affected by the proposed amendment to 
sec.4.3 
 
 
  sec.4.3. Reporting and Recordkeeping. 
 
  <nl>(a) For purposes of this section, a "currency business" refers to a person 
that engages in or has engaged in currency exchange or currency transmission 
transactions, whether the person is licensed under Texas Civil Statutes, Article 
350 (the Act), or is exempt from licensing under the Act, sec.3(b), or 
otherwise. 
   
  <nl>(b)<ol>[(a)]<nl> A currency business<ol> [Persons holding a license 
(licensees) pursuant to Texas Civil Statutes Article 350 (the Act)] shall 
maintain separate accounting books and records <nl>for its operations <ol> in 
Texas <nl>under the Act at a location <ol> [relating to their operations. All 
books and records maintained by licensees shall be located where they are] 
readily accessible to the Texas Department of Banking <nl>(the department) <ol>. 
   
  <nl>(c)<ol>[(b)] <nl>Currency businesses<ol> [Licensees] shall comply with all 
federal laws and regulations affecting their operations <nl>under the Act<ol> 
and shall maintain records of all filings made pursuant to and documentation 
required under all applicable federal laws and regulations, including the 
requirements set forth in 31 United States Code, sec.5313 and 31 Code of Federal 
Regulations (CFR), Part 103. 
   
  <nl>(d)<ol>[(c)] Each  <nl>currency business<ol> [licensee] shall, in a form 
prescribed by the banking commissioner <nl>(the commissioner)<ol>, file 
quarterly written reports with the <nl>department <ol> [Department of Banking]. 
<nl>These reports must include: 
 
  <nl>(1) year-to-date financial statements of the currency business signed by a 
principal of the currency business, including a balance sheet and statement of 
income and expenses; 
   
  <nl>(2) currency exchange and/or currency transmission activity reports for 
the currency business including: 
 
  <nl>(A) monthly summaries of its activities for each month in the quarter; 
   
  <nl>(B) the number of and total dollar amount reported on Currency Transaction 
Reports (CTRs), Form 4789, filed with the Internal Revenue Service; 
   
  <nl>(C) the number of and total dollar amount reported on Reports of 
International Transportation of Currency or Monetary Instruments (CMIRs), Form 
4790, filed with the U.S. Customs Service; 
   
  <nl>(D) the total dollars of outbound currency transmission activities by 
country of destination; and 
   
  <nl>(E) the total dollars of transmission activities transacted on behalf of 
other companies under agent agreements with the currency business; 
     
  <nl>(3) a list of all new employees, with corresponding job titles and duties, 
hired by the currency business since the last reporting period; 
   
  <nl>(4) a list of the current principals of the currency business; 
   
  <nl>(5) an explanation of any change in ownership of the currency business 
during the quarter; 
   
  <nl>(6) the days and hours of operation of the currency business; 
   
  <nl>(7) a list of all services currently offered by the currency business; 
   
  <nl>(8) a list of all foreign and domestic bank accounts, account numbers, and 
the current names of persons with signature authority on the accounts; 
   
  <nl>(9) a list of all companies for which the currency business is an agent; 
   
  <nl>(10) a reconciliation of capital since the last quarter and documentation 
of changes; and 
   
  <nl>(11) other information required by the commissioner. 
     
  <nl>(e)<ol>[(d)] In addition to the records required to be maintained under 
subsections [(a), and] (b) <nl>, (c), and (d)<ol> of this section, <nl>currency 
businesses<ol> [Licensees] shall keep the following records <nl>:<ol>[.] 
 
  (1) Currency exchange. 
 
  (A) No <nl>currency business<ol> [licensee] may engage in a currency exchange 
transaction in an amount <nl>in excess<ol> of $1,000 [or more] unless the 
<nl>currency business<ol> [licensee] issues sequentially numbered receipts or 
receipts bearing a unique identification or transaction number for each of those 
transactions. The receipts must include the date of the transaction, the amount 
and type of currency received and given in exchange, the rate of exchange, and 
the applicable commission for the transaction. The <nl>currency business<ol> 
[licensee] also shall maintain a record of each such transaction that includes 
the identifying receipt number as well as the following information: 
 
  (i) the name and address of the customer; 
   
  (ii) the social security number of the customer, or if the customer is an 
alien and does not have a social security number, then the passport number, 
alien identification card number, or other official document of the customer 
evidencing nationality or residence (e.g., a provincial driver's license with 
indication of home address); 
   
  (iii) the name and address of the person on whose behalf the transaction is 
[being] conducted if the customer is conducting the transaction on behalf of 
another person <nl>, <ol> together with the appropriate identification for such 
other person specified in clause (ii) of this subparagraph; 
   
  (iv) the location of the office where the transaction was conducted; [and] 
   
  (v) the initials of the employee of the  <nl>currency business<ol> [licensee] 
effecting the transaction  <nl>; and 
   
  <nl>(vi) the date of birth of the customer. 
     
  (B) In addition, in connection with all transactions in an amount <nl>in 
excess<ol> of $1,000 [or more], the <nl>currency business <ol> [licensee] shall 
verify the customer's name [and address] by examination of a document that 
contains the name [, address,] and a photograph of the customer and is 
customarily acceptable within the banking community as a means of identification 
when cashing checks for nondepositors and shall record the specific identifying 
information on the receipt or in the log entry related to the transaction (e.g., 
state of issuance and number of driver's license). 
   
  (C) Contemporaneous currency exchange transactions of the same or different 
types of currency made by or on behalf of the same person totaling <nl>in excess 
of<ol> $1,000 <nl>must <ol> [or more shall] be treated as one transaction. 
Multiple transactions <nl>initiated <ol> [made] by or on behalf of the same 
person during one <nl>or more <ol> business <nl>days<ol> [day] totaling <nl>in 
excess of<ol> $1,000  <nl>must<ol> [or more shall] be treated as one transaction 
if <nl>made by such person for the purpose of evading the reporting requirements 
under this section and<ol> an individual employee, director, officer, or partner 
of the <nl>currency business<ol> [licensee] knew or should have known that the 
transactions occurred. 
     
  (2) Currency Transmission. 
 
  (A) No <nl>currency business<ol> [licensee] authorized to engage in currency 
transmission may enter into a currency transmission transaction in an amount 
<nl>in excess<ol> of $1,000 [or more] unless the <nl>currency business <ol> 
[licensee] issues sequentially numbered receipts or receipts bearing a unique 
identification or transaction number for each of those transactions. The receipt 
must bear the date <nl>and time of day<ol> of the transaction, the amount of the 
transmission in United States dollars, the rate of exchange (if applicable), and 
the applicable fee or commission for the transaction. The receipt also must 
indicate whether the transaction [was] initiated or terminated <nl>the currency 
transmission<ol> [at the licensee's business]. The  <nl>currency business<ol> 
[licensee] also must maintain a record of each such transaction that includes 
the identifying receipt number as well as the following information: 
 
  (i) the name<nl>, <ol> [and] address<nl>, and telephone number<ol> of the 
customer, whether sender or recipient; 
   
  (ii) the social security number of the customer, or if the customer is an 
alien and does not have a social security number, then the passport number, 
alien identification card number, or other official document of the customer 
evidencing nationality or residence (e.g., a provincial driver's license with 
indication of home address); 
   
  (iii) the date of birth of the customer; 
   
  (iv) the name and address of the person on whose behalf the transaction is 
[being] conducted, if the customer is conducting the transaction on behalf of 
another person, together with the appropriate identification for such other 
person specified in clause (ii) of this subparagraph; 
   
  (v) the location of the office where the transaction was conducted; 
   
  (vi) the designated recipient's name, address, and telephone number, if the 
customer is the sender; 
   
  (vii) the sender's name, address, and telephone number, if the customer is the 
recipient and that information is available to the  <nl>currency business<ol> 
[licensee]; 
   
  (viii) all instructions or messages relating to the transmission; [and] 
   
  (ix) the method of payment (e.g., cash, check, credit card, etc.) <nl>; and 
   
  <nl>(x)<nl> the initials of the employee of the currency business effecting 
the transaction<ol>. 
     
  (B) In addition, in connection with all transactions in an amount <nl>in 
excess<ol> of $1,000 [or more], the <nl>currency business <ol> [licensee] shall 
verify the customer's name and address by examination of a document that 
contains the name<nl>,<ol> [and] address <nl>and photograph <ol> of the customer 
and is customarily acceptable within the banking community as a means of 
identification when cashing checks for nondepositors, and shall record the 
specific identifying information on the receipt <nl>or in the log entry related 
to the transaction<ol> [(e.g., state of issuance and number of driver's 
license)]. 
   
  (C) Contemporaneous <nl>currency transmission <ol> transactions initiated by 
or on behalf of the same person or received by or on behalf of the same person 
totaling <nl>in excess of<ol> $1,000 <nl>must<ol> [or more shall] be treated as 
one transaction. Multiple transactions [during a single business day] initiated 
by or on behalf of the same person or received by or on behalf of the same 
person <nl>during one or more business days<ol> [and] totaling <nl>in excess 
of<ol> $1,000 <nl>must<ol> [or more shall] be treated as one transaction if 
<nl>made by such person for the purpose of evading the reporting requirements 
under this section and<ol> an individual employee, director, officer, or partner 
of the <nl>currency business <ol> [licensee] knew or should have known that the 
transactions occurred. 
     
  (3) A <nl>currency business shall <ol> [licensee must] maintain a log or logs  
<nl>of its activities under the Act<ol> for each calendar month <nl>containing 
<ol> [on which shall be recorded] the following information for each 
transaction: 
 
  (A) the date of the transaction; 
   
  (B) the location of the office where the transaction was conducted; 
   
  (C) the amount and type of currency received and given in exchange, or the 
amount of the transmission, as applicable; 
   
  (D) the rate of exchange, if applicable; 
   
  (E) the amount of service charges or fees assessed in connection with the 
transaction; and 
   
  (F) the number of the receipt issued in connection with the transaction, if 
any. 
       
  <nl>(f)<ol>[(e)] All logs, records, and receipt information may be maintained 
by the <nl>currency business <ol> [licensee] in a readily accessible and 
retrievable form and must be maintained for a period of at least five years. An 
actual duplicate copy of receipts issued by a <nl>currency business<ol> 
[licensee] need not be retained if the information required on the receipt is 
maintained in <nl>hard copy<ol> [a readily accessible and retrievable] form<nl>, 
on microfiche, or in an electronic database from which information may be 
reasonably retrieved in hard copy form<ol>. 
   
  <nl>(g)<ol> [(f)] Failure to comply with this section <nl>constitutes<ol> 
[shall be] grounds for denial, revocation, or suspension of a license as 
provided in the Act, sec.6, and assessment of a civil penalty in accordance with 
the Act, sec.15. 
   
  <nl>(h)<ol>[(g)] The commissioner may waive any requirement of this section 
upon a showing of good cause if the commissioner is of the opinion that: 
 
  (1) the <nl>currency business <ol> [licensee] maintains records sufficient for 
the department to examine <nl>its<ol> [the licensee's] operations; or 
   
  (2) the imposition of the requirement would cause an undue burden on the 
<nl>currency business <ol> [licensee] and conformity with the requirement would 
not significantly advance the state's interests under the Act. 
     
  <nl>(i) In lieu of compliance with this section, the commissioner may 
authorize a currency business to maintain its records in accordance with 31 CFR, 
sec.103.33(f). Such authorization must be pursuant to the commissioner's written 
approval based on review of current audited financial statements of the currency 
business. To support authorization under this subsection, the audited financial 
statements must have been issued by a certified public accountant acceptable to 
the commissioner within the 18-month period prior to its submission to the 
department and must have an unqualified opinion. If at an examination or other 
review of the records of a currency business by the department a violation of 31 
CFR, sec.103.33(f), or the Act is cited, the authorization of the currency 
business pursuant to this subsection is subject to immediate revocation by order 
of the commissioner. 
   
  <nl>(j) A currency business does not violate this section if it cannot produce 
records on transactions conducted prior to the effective date of this section 
which were not previously required by statute or rule. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be a valid exercise of the agency's authority. 
 Issued in Austin, Texas, on April 26, 1996. 
 TRD-9605807 
  Everette D. Jobe 
 General Counsel, Texas Department of Banking 
 State Finance Commission 
    Proposed date of adoption: June 21, 1996 
 For further information, please call: (512) 475-1300 
         
           
  7 TAC sec.4.9 
 
  The Finance Commission of Texas (the commission) proposes new sec.4.9, 
concerning the procedure to be used by the Department of Banking (the 
department) for handling continuing and repeat violations of the Currency 
Exchange Act, Texas Civil Statutes, Article 350 (the Act), or an order or rule 
of the banking commissioner (the commissioner) promulgated under the Act. 
 Pursuant to the Act, sec.15, a person who violates the Act or a order or rule 
of the commissioner promulgated under the Act is subject to a civil penalty 
imposed by the commissioner. The proposed new section would require a cited 
licensee or person exempt from licensing under the Act to correct the violation 
and notify the department in writing within a specified time that the violation 
has been corrected, giving the date of correction. Because of staffing 
limitations, the department in the short term must be able to rely on licensee 
representations that violations have been corrected. Therefore, the proposed new 
section sets out that, with certain exceptions, a licensee or person exempt from 
licensing under the Act who misrepresents that a violation has been corrected 
violates this section. 
 Proposed sec.4.9 also provides that, if the violation is not corrected within 
the correction period, the department may prosecute an administrative hearing 
for civil penalties from the date the original written notice of the violation 
is received without giving additional notice citing the violation. The proposed 
new section provides, however, that a notice of hearing must be given prior to 
the administrative hearing. Furthermore, the proposed new section provides that 
the correction period is inapplicable to a violation repeated within 18 
consecutive months, and the department may immediately set such a violation for 
an administrative hearing for civil penalties from the date of the subsequent 
violation. 
 Finally, the proposed new section establishes a "mailbox rule," defines "repeat 
violation," and sets out certain enforcement measures with respect to repeat 
violations that are authorized under the Act, including the initiation of an 
administrative hearing seeking maximum civil penalties. 
 Stephanie Newberg, Director, Special Audits Division, Texas Department of 
Banking, has determined that, for each year of the first five years the section 
is in effect, there will be no fiscal implications for state or local government 
as a result of enforcing or administering this section. 
 Ms. Newberg also has determined that, for each year of the first five years the 
section is in effect, the public benefit anticipated as a result of its adoption 
will be a more efficient, uniform procedure for assessing civil penalties 
against violators of the Act, or a order or rule of the commissioner promulgated 
under the Act. No economic cost will be incurred by a person required to comply 
with this section, and there will be no effect on small businesses. 
 Comments on the proposed section may be submitted in writing to Stephanie 
Newberg, Director, Special Audits Division, Texas Department of Banking, 2601 
North Lamar Boulevard, Austin, Texas 78705-4294. 
 The new section is proposed pursuant to rulemaking authority under the Act, 
sec.7, which authorizes the commission to prescribe rules necessary to implement 
the Act. 
 Texas Civil Statutes, Article 350, is affected by the newly proposed sec.4.9. 
 
 
  sec.4.9. Misrepresentation of Correction; Enforcement Actions for Continuing 
and Repeat Violations. 
 
  (a) Notice to the department. A licensee or person exempt from licensing under 
the Act, sec.3(b) (exempt person), cited for a violation of Texas Civil 
Statutes, Article 350 (the Act), or a rule or order promulgated thereunder, 
shall correct the violation and notify the department in writing within 30 days 
of receiving written notice of the violation from the department that the 
violation has been corrected and that the correction occurred on a specified 
date. Absent proof to the contrary, receipt of notice of the violation is deemed 
to have occurred three days from the date of its mailing. 
   
  (b) Misrepresentation of correction. Except as provided in subsection (c) of 
this section, a licensee or exempt person who responds to the department in 
writing under subsection (a) of this section indicating that the violation has 
been corrected violates this section if the violation has not been corrected as 
represented in the response. 
   
  (c) Good faith actions and belief. Subsection (b) of this section does not 
apply to circumstances in which the department determines that a diligent effort 
has been made to correct a violation in good faith and that it was not 
unreasonable for the licensee or exempt person to believe the violation had been 
corrected as reported. 
   
  (d) Civil penalties. In addition to another enforcement action permitted by 
law, if 30 days has elapsed since the cited licensee or exempt person received 
the notice of violation and the violation has not been corrected within that 30-
day period, the department may prosecute an administrative hearing for civil 
penalties under the Act, sec.15. Civil penalties in such a hearing may properly 
be assessed against the licensee or exempt person from the date the original 
written notice of violation was received until the violation is corrected. 
Without sufficient proof to the contrary, receipt of notice under this 
subsection is deemed to have occurred three days from the date of its mailing. 
   
  (e) Notice of hearing required. Notice of hearing meeting the requirements of 
the Act, sec.21, must be given prior to an administrative hearing for civil 
penalties under the Act, sec.15. 
   
  (f) Repeat violations. A violation of the Act, or a rule or order promulgated 
thereunder, that is cited on more than one consecutive examination report is a 
repeat violation. Repeat violations are subject to various enforcement actions 
under the Act, including but not limited to injunctive relief under the Act, 
sec.16, forfeitures under the Act, sec.17, and cease and desist orders under the 
Act, sec.18, and are sufficient cause for the department to seek maximum civil 
penalties available under the Act, sec.15, or to pursue other recourse 
authorized by law. 
   
  (g) Correction period inapplicable. In the event a licensee or exempt person 
violates the same provision of the Act, rule, or order more than once within 18 
consecutive months, the 30-day correction period provided for in subsection (a) 
of this section does not apply, and the department may immediately set the 
violation for an administrative hearing to assess civil penalties under the Act, 
sec.15. Civil penalties in such a hearing may properly be assessed against the 
licensee or exempt person from the date of the subsequent violation. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be a valid exercise of the agency's authority. 
 Issued in Austin, Texas, on April 26, 1996. 
 TRD-9605808 
  Everette D. Jobe 
 General Counsel, Texas Department of Banking 
 State Finance Commission 
    Proposed date of adoption: June 21, 1996 
 For further information, please call: (512) 475-1300 
         
                 Part II. Texas Department of Banking 
  Chapter 12. Loans and Investments 
  
  Subchapter C. Investment Limits 
 
  7 TAC sec.12.61 
 
  The Finance Commission of Texas (the commission) proposes new sec.12.61, 
concerning investment in securities by state banks, in proposed Subchapter C 
entitled Investment Limits. The proposed section clarifies that a state bank 
does not violate an applicable investment limitation when an investment in 
securities that was legal when made becomes nonconforming as a result of the 
enactment of Texas Civil Statutes, Article 342-1.001 et seq (the Texas Banking 
Act, sec.sec.1.001 et seq) (Act), particularly the Act, sec.5.101 and sec.5.104. 
The proposed section also specifies that a state bank may not make an investment 
after September 1, 1995, which is not in compliance with the Act. 
 The Act, sec.5.101(c), permits a state bank to acquire investment securities 
for the bank's own account subject to a 15% limit of the bank's capital and 
certified surplus in any one obligor or maker, although sec.5.101(d) exempts 
various investment securities from the 15% general limit. 
 The Act, sec.5.104(b), permits a state bank to invest in equity securities of 
certain investment companies (mutual funds) without limit if the mutual fund's 
portfolio consists wholly of investments in which the bank could invest directly 
without limitation under sec.5.101(d). If the mutual fund's portfolio contains 
an investment or obligation that is subject to the limitations of sec.5.101(c) 
or 5.201(a), under the Act, sec.5.104(c), a state bank may invest in these 
equity securities subject to a limitation of 15% of the bank's capital and 
certified surplus. The Act, sec.5.101 and sec.5.104, provides flexibility for 
state bank securities investments, with limitations similar to those imposed on 
national banks under federal law. 
 Everette D. Jobe, General Counsel, Texas Department of Banking, has determined 
that for the first five-year period the section is in effect, there will be no 
fiscal implication for state or local government as a result of enforcing or 
administering the section. 
 Mr. Jobe also has determined that for each year of the first five years the 
section is in effect, the public benefit anticipated as a result of enforcing 
this section is the clarification of highly complex statutory standards to aid 
the industry in compliance. No net economic cost will result to persons required 
to comply with the proposed section. No difference will exist between the cost 
of compliance for small businesses and the cost of compliance for the largest 
businesses affected by this section. 
 Comments on the proposed section may be submitted in writing to Jerry Sanchez, 
Assistant General Counsel, Texas Department of Banking, 2601 North Lamar 
Boulevard, Austin, Texas 78705-4294. 
 The new section is proposed under the Act, sec.5.101(i), which authorizes the 
commission to adopt rules to administer and carry out the Act, sec.5.101, 
including rules to establish limits, requirements, or exemptions other than 
those specified by the Act, sec.5.101, for particular classes or categories of 
investment securities, or limit or expand investment authority for state banks 
for particular classes or categories of investment securities. The new section 
is also proposed under the Act,  s1.012(a), which authorizes the commission to 
adopt rules to implement and clarify the Act, to preserve or protect the safety 
and soundness of state banks, and grant the same rights and privileges to state 
banks that are or may be granted to national banks domiciled in this state. As 
required by the Act, sec.1.012(b)(1), (2), the commission considered the need to 
promote a stable banking environment, provide the public with convenient, safe, 
and competitive banking services, preserve and promote the competitive parity of 
state banks with national banks and other depository institutions in this state 
consistent with the safety and soundness of state banks and the state bank 
system, and allow for economic development within this state. 
 Texas Banking Act, sec.5.101 and sec.5.104, is affected by this proposed new 
section. 
 
 
  sec.12.61. Transition Provisions. 
 
  (a) An investment in securities made prior to September 1, 1995, that was 
within a state bank's investment limit when made but is currently in excess of 
the limitations of Texas Civil Statutes, Article 342-5.101 or Article 342-5.104, 
is considered a conforming investment. 
   
  (b) A state bank may not make an investment on or after September 1, 1995, 
that is not in compliance with law or that would cause an existing investment 
described in subsection (a) of this section to become further out of compliance 
with law. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 26, 1996. 
 TRD-9605814 
  Everette D. Jobe 
 General Counsel 
 Texas Department of Banking 
    Proposed date of adoption: June 21, 1996 
 For further information, please call: (512) 475-1300 
         
               Chapter 15. Corporate Activities 
  
  Subchapter F. Change of Control 
 
  7 TAC sec.15.81 
 
  The Finance Commission of Texas (the commission) proposes new Subchapter F, 
sec.15.81, concerning acquisitions or changes of control of state banks and bank 
holding companies subject to regulation by the Banking Commissioner of Texas 
(commissioner). 
 The section as proposed sets out when an application is necessary and the 
information which must be included in the application; identifies additional 
exempt transactions; defines situations in which a notice in lieu of filing is 
permissible and clarifies the role of the commissioner in the approval process. 
The proposed new section is necessary as a result of the enactment of Texas 
Civil Statutes, Articles 342-1.001 et seq (the Texas Banking Act, sec.sec.1.001 
et seq) (Act), particularly Chapter 4, Subchapter A-Transfer of Ownership 
Interests in State Bank ( ssec.4.001 through 4.007), which substantially amends 
the prior law, Texas Civil Statutes, Article 342-401 and Article 342-401a 
(repealed). In addition, new sec.15.81 is proposed to reduce regulatory burden, 
especially concerning exempt transactions, and to make the Act, sec.sec.4.002-4. 
005, compatible with federal regulations to the extent possible. 
 Repealed Texas Civil Statutes, Article 342-401, required regulated entities to 
file notice subsequent to the transfer of 10% or more of the outstanding voting 
securities. Article 342-401a required the filing of an application with the 
commissioner prior to a transfer of 25% or more of the outstanding voting 
securities. The filing requirement for notice subsequent to the transfer of 10% 
of the outstanding voting securities of a state bank or bank holding company has 
been eliminated in the Act. The Act, sec.1.002(15), has, however, broadened the 
definition of control. Control is defined generally as the ability to control or 
influence management, regardless of the number of voting securities transferred 
or the form used for accomplishment of control. Ownership of 25% of the voting 
securities outstanding of a state bank or bank holding company is a presumption 
of control and requires application for approval. The Act, sec.4.001(a), also 
defines control as direct or indirect ownership or power to vote, by a principal 
shareholder or participant, a greater percentage of voting securities of a state 
bank or bank holding company than any other shareholder or participant. The Act, 
sec.4.002, provides for an application requesting approval of change of control 
consistent with the definition of control. Proposed sec.15.81(b) and (c) provide 
for the filing of an application pursuant to the above provisions. Subsection 
(c), as proposed, requires that each subject applicant file a fully completed 
verified application containing detailed biographical and financial information. 
Proposed subsection (h) sets out situations in which a notice in lieu of filing 
an application is authorized. 
 The Act, sec.4.003, changes the time for approval or denial of the application 
for acquisition or change of control to 60 days from the 30 day period under 
former Article 342-401a(D), and describes the criteria for approval and the 
procedures for requesting a hearing by the commissioner, which are substantially 
unchanged from former law. The Act, sec.4.004, provides that the standard of 
review applicable to an appeal of a denial of change of control is the 
substantial evidence rule rather than the de novo standard required under former 
law. Proposed subsection (i) clarifies the Act in providing that an applicant 
may receive automatic approval should the commissioner fail to give the 
applicant written approval within the 60-day period, subject to the notification 
provisions in subsection (k) as proposed. In addition, the commissioner is 
specifically authorized to give conditional approval under proposed subsection 
(i) or may deem an application abandoned under proposed subsection (l). Proposed 
subsection (m) further clarifies the hearings process regarding applications, 
especially where conditional approval is warranted. 
 The Act, sec.4.005, provides for exemptions from change of control provisions 
if the acquisition is to satisfy or compromise a bona fide preexisting debt; if 
the shares are acquired by one who already holds control or has been approved as 
a control person; or if the change of control is subject to the Act, Chapter 8, 
Subchapter D (relating to acquisitions of banks by bank holding companies 
subject to review and approval by the Board of Governors of the Federal Reserve 
System). Acquisition by inheritance is also exempt. Proposed sec.15.81(g) 
provides for additional exemptions from the application process which have been 
determined to be appropriate to the objectives of the Act. These proposed 
exemptions include acquisitions or changes of control which are inadvertent as a 
result of a stock redemption or repurchase if the potential control person had 
no input into the decision; which involve holdings by an employee stock 
ownership plan of less than 25% under certain conditions; or which are the 
result of distributions of a proportionate number of voting securities as a 
result of the liquidation of a bank holding company. The subsection as proposed 
also exempts acquisitions or changes of control as a result of gifts to close 
family members or to a limited partnership under certain conditions if neither 
the donor or donee is under an enforcement order and notice is given in lieu of 
the filing of an application. 
 Finally, the Act of May 18, 1995, 74th Legislature, Chapter 914, sec.31(a), 
1995 Texas Session Law Service 4451, 4552, contained certain transition 
provisions which clarified that a principal shareholder or participant is not 
required to file a change of control application if deemed in control solely by 
reason of changed standards in the Act as long as no additional voting 
securities are acquired. As proposed, sec.15.81(f) incorporates this provision. 
 Sammie K. Glasco, Assistant General Counsel, Texas Department of Banking, has 
determined that for the first five-year period the section is in effect, there 
will be no fiscal implications for state or local government as a result of 
enforcing or administering the section. 
 Ms. Glasco also has determined that, for each year of the first five years the 
new section is in effect the public benefit anticipated as a result of enforcing 
the new section is the clarification of statutory requirements to aid the 
industry in compliance. No net economic cost will result to persons required to 
comply with the proposed section. No difference will exist between the cost of 
compliance for small businesses and the cost of compliance for the largest 
businesses affected by this section. 
 Comments on the proposed section may be submitted in writing to Sammie K. 
Glasco, Assistant General Counsel, Texas Department of Banking, 2601 North Lamar 
Boulevard, Austin, Texas 78705-4294. 
 The new section is proposed under the Act, sec.1.012, which authorizes the 
commission to adopt rules to accomplish the purposes of the Act, to implement 
and clarify the Act, to preserve the safety and soundness of state banks, and to 
grant the same rights and privilege to state banks that are or may be granted to 
national banks domiciled in Texas. As required by the Act, sec.1. 012(b), the 
commission considered the need to promote a stable banking environment, provide 
the public with convenient, safe, and competitive banking services, preserve and 
promote the competitive parity of state banks with national banks and other 
depository institutions in this state consistent with the safety and soundness 
of state banks and the state bank system, and allow for economic development 
within this state. 
 The Act, sec.sec.1.002(15) and 4.002-4.005, is affected by this new section. 
 
 
  sec.15.81. Application for Acquisition or Change of Control of State Bank. 
 
  (a) Definitions. Words and terms used in this chapter that are defined in 
Texas Civil Statutes, Articles 342-1.001 et seq (The Texas Banking Act, 
sec.sec.1.001 et seq) (the Act), have the same meanings as defined in the Act. 
   
  (b) General. Without the prior written consent of the banking commissioner, a 
person or entity may not acquire a legal or beneficial interest in voting 
securities of a state bank or a corporation or other entity owning voting 
securities of a state bank if, after the acquisition, the person or entity would 
control the state bank. Except as otherwise provided in this section, an 
application must be filed with the banking commissioner for review and 
consideration of the proposed transaction. 
   
  (c) Form of application. The applicant shall submit a fully completed, 
verified application on a form prepared and prescribed by the banking 
commissioner and simultaneously tender the required filing fee pursuant to 
sec.15.2 of this title (relating to Filing Fees and Cost Deposits). The 
application must, except to the extent expressly waived in writing by the 
banking commissioner, disclose the following information: 
 
  (1) the identity, biographical data, business background, and experience 
relating to banking matters, and a current statement financial condition, a 
statement of changes in net worth and a statement of cash flows of each person 
by whom, or on whose behalf, the acquisition is to be made and by each person 
acting in concert with others seeking to acquire voting securities subject to 
the Act and to this section. Financial statements will be considered current if 
audited and dated within 180 days of the date of the application or will be 
considered current if unaudited and dated within 90 days of the date of the 
application. All financial statements must be accompanied by an affidavit of no 
material change dated as of the date of application; 
   
  (2) a completed authorization to release employment, financial, credit, 
fingerprint information and criminal history records to the department; 
   
  (3) a completed confirmation inquiry form; 
   
  (4) the identity of each entity other than a natural person seeking to acquire 
control or working in concert with others to acquire control of a state bank or 
bank holding company and a copy of the entity's most recent audited financial 
statement. Financial statements will be considered current if audited and dated 
within 180 days of the date of the application or will be considered current if 
unaudited and dated within 90 days of the date of the application. All financial 
statements must be accompanied by an affidavit of no material change dated as of 
the date of application; 
   
  (5) a description of all material, pending or adjudicated legal or 
administrative proceedings in which each acquiring person or entity is or was a 
party. A material legal proceeding includes a proceeding in which the person or 
entity has been charged with, cited for, or convicted under a state or federal 
law relating to banking or other financial institutions, securities or financial 
instrument reporting, or a felony or crime involving moral turpitude under the 
laws of a state, the United States, or another country. A material legal 
proceeding also includes a proceeding that resulted in a material unsatisfied 
judgment against the acquiring person or entity or that may result in a judgment 
and the loss contingency must be disclosed in the financial statements of the 
acquiring person or entity under generally accepted accounting principles, or is 
otherwise material. A material administrative proceeding includes a proceeding 
in which the person or entity is or has been subject to a cease and desist, 
removal, enforcement, or other order, including an order of supervision or 
conservatorship issued by a state, federal, or foreign regulatory agency; 
   
  (6) the terms and conditions of the proposed acquisition or change of control 
and the manner in which the acquisition or change of control is to be made; 
   
  (7) the identity, source, and amount of the funds or other consideration used 
or to be used in making the acquisition or change of control; 
   
  (8) if a portion of the funds or other consideration to be used in making the 
acquisition has been borrowed or is to be borrowed or otherwise obtained for the 
purpose of making the acquisition, a complete description of the transaction, 
the names of the parties to the transaction, and a summary of all arrangements, 
agreements, or understandings with such parties including terms of repayment; 
   
  (9)  the applicant's current or proposed business or strategic plan including 
amendments to a current plan; 
   
  (10) plans or proposals to liquidate the state bank or bank holding company, 
to sell its assets or merge it with another bank or holding company, or to make 
other major changes in its business, corporate structure, or management; 
   
  (11) plans or proposals to change officers and directors of the state bank or 
bank holding company and the related bank or financial institution management 
experience of proposed or current officers and directors; 
   
  (12) the terms and conditions of an offer, invitation, agreement, or 
arrangement under which a voting security will be acquired and any contract 
affecting such security or its financing after it is acquired; 
   
  (13) pro forma financial statements with projections indicating whether the 
acquired or controlled state bank or bank holding company will be adequately 
capitalized for a period of not less than two years from the date of 
acquisition; and 
   
  (14) such other information that the banking commissioner requires to be 
included in the particular application as considered necessary to an informed 
decision to approve or reject the proposed acquisition. The applicant bears the 
burden to supply all material information necessary to enable the banking 
commissioner to make a fully informed decision regarding the application. 
     
  (d)  Public notice. Upon notification that an initial application is complete 
and accepted for filing pursuant to  s15.4(b) of this title (relating to 
Required Information and Abandoned Filings), the applicant shall publish notice 
as required by the Act, sec.4.002(d), and sec.15.5 of this title (relating to 
Public Notice) in the county where the state bank's or bank holding company's 
home office is located. One publication under this subsection is adequate unless 
the banking commissioner expressly requires additional notice. 
   
  (e) Confidentiality. Information obtained by the banking commissioner under 
this section is confidential and may not be disclosed by the banking 
commissioner or an officer or employee of the department, subject only to such 
disclosure as may be permitted by the Act, sec.sec.2.102-2.108 or 4.002(d), or 
by sec.3.111 of this title (relating to Confidential Information). 
   
  (f) Grandfather clause. A person or entity considered to be in control solely 
as a result of changed standards in the Act as effective September 1, 1995, is 
exempt from filing an application under this section as long as such person was 
in compliance with applicable law immediately prior to the effective date of the 
Act and has not acquired additional shares of voting securities subsequent to 
the passage of the Act. This subsection specifically applies to a principal 
shareholder or principal participant of a state bank or bank holding company 
that directly or indirectly owns or has the power to vote a greater percentage 
of voting securities of the state bank or holding company than another 
shareholder or participant. 
   
  (g) Exemptions. In addition to the acquisitions specifically exempted pursuant 
to the Act, sec.4.005, the following types of involuntary acquisitions of 
control do not require prior written approval of the banking commissioner 
pursuant to the Act,  s4.001: 
 
  (1) the inadvertent acquisition of control of a state bank or bank holding 
company by a shareholder as a result of a stock redemption or repurchase by the 
issuer if the potential controlling shareholder or participant of a state bank 
or bank holding company did not vote or have any direct or indirect input into 
the issuer's decision to repurchase or redeem the voting securities; 
   
  (2)  the acquisition and control by a qualified employee stock ownership plan 
(ESOP) of less than 25% of voting securities of a state bank or bank holding 
company unless an officer, director, or principal shareholder or participant 
directly or indirectly controls the voting securities held by the ESOP, in which 
event an application for acquisition of control must be filed; 
   
  (3)  the acquisition of control of a state bank as a result of a shareholder 
receiving proportionate voting securities in a state bank the liquidation of a 
bank holding company; 
   
  (4) the acquisition of additional shares of voting securities of a state bank 
or bank holding company by virtue of a pro-rata stock dividend or stock split 
not resulting in increased ownership percentage; 
   
  (5) the acquisition of control of a state bank or bank holding company as a 
result of a gift made in good faith, provided 
 
  (A)  the donee is related to the donor within the second degree of 
consanguinity or affinity, 
   
  (B) neither the donor nor donee is under an enforcement order, and 
   
  (C) notice of the gift is given to the banking commissioner pursuant to 
subsection (h) of this section; and 
     
  (6)  the acquisition of control of a state bank or bank holding company as a 
result of the transfer of voting securities by gift to a limited partnership if 
 
  (A) the limited partnership owns no other voting securities other than the 
securities transferred, 
   
  (B) the donor is the sole general partner of the limited partnership who 
retains sole voting authority over the voting securities, 
   
  (C) neither the donor nor donee is under an enforcement order, and 
   
  (D) notice of the gift is given to the banking commissioner pursuant to 
subsection (h) of this section. 
       
  (h) Notices in lieu of filing. In the event that an application is not 
required because of exemption under the Act, sec.4.005, or subsection (g) of 
this section, but an application is required to be filed with a federal 
regulatory authority or a regulatory authority of another state, a copy of the 
application as filed with another agency must be filed with the banking 
commissioner within seven days of the date of such other filing or filings. A 
notice in lieu of filing is also required of a person claiming an exemption 
under the Act, sec.4.005(1) or (3), or subsection (g)(5) and (6) of this 
section. This notice must be filed before the securities acquired are voted and 
must be accompanied by a completed authorization pursuant to subsection (c)(2) 
of this section. No filing fees are required for notices filed under this 
section; however, should the banking commissioner determine that an application 
is required, the appropriate filing fee pursuant to sec.15.2 of this title 
(relating to Filing Fees and Cost Deposits) is required. 
   
  (i) Approval. Automatic approval; conditional approval. If an application 
filed under this section is not approved by the banking commissioner or is not 
set for hearing on or before the 60th day after notice is filed pursuant to the 
Act, sec.4.002(d), the transaction may be consummated. The commissioner may, 
before the expiration of the initial 60-day period, give the applicant written 
notice that the application has been approved, in which case the transaction may 
be immediately consummated on receipt of the notice. The banking commissioner 
may also, before the expiration of the initial 60-day period, give an applicant 
written notice that the application has been approved subject to certain 
conditions. The applicant shall enter into a written agreement with the banking 
commissioner concerning the conditions on or before the 30th day after the date 
of notification of conditional approval. An agreement entered into by the 
applicant and the banking commissioner concerning conditional approval is 
enforceable against the applicant and the bank and is considered for all 
purposes an agreement under the provisions of the Act. In the event that an 
applicant who has received conditional approval does not enter into an agreement 
with the banking commissioner as required by this subsection, the banking 
commissioner shall set the matter for hearing. 
   
  (j)  Consummation of an acquisition or change of control transaction. The 
acquisition or change of control of the voting securities must be consummated as 
proposed in the application, in the agreement concerning conditional approval as 
provided in subsection (i) of this section, or as provided in a final order 
pursuant to subsection (m) of this section. A transaction approved or 
conditionally approved under this section must be consummated within 12 months 
after the date of approval by the banking commissioner unless an extension is 
granted in writing. Until a transaction is consummated, the banking commissioner 
reserves the right to alter, suspend or withdraw approval should an interim 
development warrant such action. 
   
  (k) Notification by banking commissioner. A notification by the banking 
commissioner under this section may be by registered or certified mail, return 
receipt requested, and is complete when the notification is deposited in the 
United States mail postage prepaid, return receipt requested, addressed to the 
address furnished in the application. 
   
  (l) Abandoned filing. The banking commissioner may determine an application to 
be abandoned pursuant to sec.15.4 of this title (relating to Required 
Information and Abandoned Filings). 
   
  (m) Hearing on application. The banking commissioner shall set an application 
for hearing on or before the 60th day after notice is published as required by 
the Act, sec.4.002(d), and subsection (i) of this section. The notice of hearing 
must comply with Government Code, sec.2001.051, and shall state that the purpose 
of the hearing is to give the applicant an opportunity to show all required 
qualifications for the banking commissioner's approval of the acquisition or 
change of control application have been met. The applicant has the burden of 
showing all such required qualifications by a preponderance of evidence. The 
hearing must comply with Government Code, Chapter 2001 (the Administrative 
Procedure Act). After the hearing, the banking commissioner shall grant or deny 
the application based solely upon the evidence presented at the hearing. An 
applicant may not appeal denial of an application or conditional approval of an 
application until a final order is issued. If after a hearing has been held, the 
banking commissioner has entered an order denying the application, and the order 
has become final, the applicant may appeal the final order by filing a petition 
for judicial review under the substantial evidence rule in the District Court of 
Travis County, Texas, and not elsewhere, as provided by the Act, sec.4.004, and 
the Government Code, Chapter 200l. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 26, 1996. 
 TRD-9605798 
  Everette D. Jobe 
 General Counsel 
 Texas Department of Banking 
    Proposed date of adoption: June 21, 1996 
 For further information, please call: (512) 475-1300 
         
                   
  TITLE 16. ECONOMIC REGULATION 
 Part II. Public Utility Commission of Texas 
  Chapter 23. Substantive Rules 
  
  Telephone 
 
  16 TAC sec.23.101 
 
  The Public Utility Commission of Texas proposes new sec.23.101, relating to 
LEC Services to Providers of Audio or Video Programming. The proposed new rule 
provides for the filing of all contracts and arrangements between an incumbent 
local exchange company and its separate corporate affiliate that provides audio 
or video programming. The rule also provides for the filing of a report prepared 
by an independent accounting firm regarding an incumbent local exchange 
company's compliance with laws relating to its provisioning of services to 
providers of audio or video programming. 
 Jackie Follis, Senior Policy Analyst for the Legal Division of the Office of 
Regulatory Affairs, has determined that for each year of the first five-year 
period the proposed section is in effect there will be no fiscal implications 
for state or local government as a result of enforcing or administering the 
section. 
 Ms. Follis also has determined that for each year of the first five years the 
proposed section is in effect the public benefit anticipated as a result of 
enforcing the section will be that information regarding an incumbent local 
exchange company's provisioning of services to providers of audio or video 
programming will be available for review at the commission. There will be no 
effect on small businesses as result of enforcing this section. There is no 
anticipated economic cost to persons who are required to comply with the section 
as proposed. 
 Ms. Follis also has determined that for each year of the first five years the 
proposed section is in effect there will be no impact on employment in the 
geographical area affected by implementing the requirements of the section. 
 Comments on the proposed rule (16 copies) may be submitted to Paula Mueller, 
Secretary of the Commission, Public Utility Commission of Texas, 7800 Shoal 
Creek Boulevard, Austin, Texas 78757, within 30 days after publication. Reply 
comments may be submitted to the same address within 60 days after publication. 
All comments should refer to Project Number 14508. The commission invites 
specific comments regarding the costs associated with, and benefits that will be 
gained by, implementation of the rule. The commission will consider the costs 
and benefits in deciding whether to adopt the rule. Additionally, the commission 
invites specific comments regarding how the passage of S. 652, (Federal 
Telecommunications Act of 1996) impacts this rule. The commission staff will 
conduct a public hearing on this rulemaking under Texas Government Code, 
sec.2001.029 at the commission offices on May 16, 1996, at 10:00 a.m. 
 The new section is proposed under Texas Civil Statutes, Article 1446-o, 
sec.1.101, Senate Bill 319, 74th Legislature, Regular Session 1995, which 
provides the Public Utility Commission with the authority to make and enforce 
rules reasonably required in the exercise of its powers and jurisdiction, 
including rules of practice and procedure; and Texas Civil Statutes, Article 
1446-o, sec.3.502, which require that contracts, arrangements and reports 
regarding an incumbent local exchange company's provisioning of services to 
providers of audio or video programming be filed with the commission. 
 Cross Index to Statutes: Texas Civil Statutes, Article 1446-o, sec.sec.1.101, 
3. 502, 3.503, and 3.504. 
 
 
  sec.23.101. LEC Services to Providers of Audio or Video Programming. 
 
  (a) Purpose. An incumbent local exchange company may not provide audio or 
video programming in this state; however, nothing in this section prohibits a 
separate corporate affiliate of an incumbent local exchange company from 
providing audio or video programming. This section establishes procedures for 
the filing of contracts or arrangements and reports related to an incumbent 
local exchange company's provisioning of telecommunications services to a 
separate corporate affiliate that provides video or audio programming. 
   
  (b) Small LEC application. This section does not apply to an incumbent local 
exchange company having 100,000 or fewer total access lines in this state. 
   
  (c) Definitions. The following words and terms, when used in this section, 
shall have the meanings set out in sec.3.502 (related to Audio Video) of Texas 
Civil Statutes, Article 1446-o (the Act), unless the context clearly indicates 
otherwise: 
 
  (1) audio programming; and 
   
  (2)  video programming. 
     
  (d) Affiliate services. As to its separate corporate affiliate providing video 
or audio programming, an incumbent local exchange company: 
 
  (1) may not develop a rate for a telecommunications service or deploy a 
telecommunications service to primarily benefit its separate affiliate for the 
affiliate's video or audio programming unless that rate or service is available 
on a nondiscriminatory basis to all purchasers; 
   
  (2) may not be unreasonably preferential in the deployment of 
telecommunications services for its separate affiliate's audio or video 
programming; 
   
  (3) may not enter into customer specific contracts for the provision of 
tariffed telecommunications services with its separate affiliate unless 
substantially the same terms and conditions of the contract are generally 
available to nonaffiliated interests; 
   
  (4) shall maintain and file with the commission copies of all contracts or 
arrangements between the incumbent local exchange company and the separate 
affiliate and report the contract amount for each cash and noncash transaction 
with the separate affiliate, including payments for costs of any goods and 
services or any property right or thing or for interest expense; 
   
  (5) may not transfer assets to the separate affiliate unless those assets are 
priced no lower than assets that are available in an arm's-length transaction to 
third parties; 
   
  (6) shall value any assets that are transferred to a separate affiliate at the 
greater of net book or fair market value; 
   
  (7)  shall value any assets that are transferred to it by its separate 
affiliate at the lesser of net book value or fair market value except instances 
where Federal Communications Commission or commission rules or regulations 
permit in-arrears payment for tariffed telecommunications services or the 
investment by an affiliate of dividends or profits derived from the incumbent 
local exchange company; 
   
  (8) shall comply with all applicable Federal Communications Commission cost 
and other accounting rules; 
   
  (9) may not have any directors, officers, or employees in common with the 
separate affiliate; 
   
  (10) may not own any property in common with the separate affiliate; and 
   
  (11) shall provide, if it offers telecommunications equipment or services to 
audio and video programming providers, those services: 
 
  (A) at just and reasonable rates that are tariffed, so long as the commission 
rules require those tariffs, under nondiscriminatory terms and conditions; and 
   
  (B) if the equipment and services are not subject to regulation, on similar 
terms and conditions to all video or audio programming providers. 
       
  (e) Compliance audit. An incumbent local exchange company shall have a 
compliance audit performed every three years by an independent accounting firm. 
The audit shall be conducted for the purposed of determining whether the 
incumbent local exchange company, during the preceding three years, is in 
compliance with all of the requirements imposed by this section regarding the 
incumbent local exchange company. The independent accounting firm shall file the 
report with the commission. If the report concludes that the incumbent local 
exchange company is not in compliance with any portion of this section, the 
commission shall institute appropriate action against the incumbent local 
exchange company. The report shall be considered commercial or financial 
information that is confidential by statute under Government Code, Chapter 552. 
   
  (f) Filing Requirements. All reports and copies of contracts or arrangements 
that are required to be filed by this section shall be filed in the commission's 
central records under project number 14508. 
   
  (g) Waiver. A company to which this section applies may petition the 
commission for a waiver from any of the requirements imposed by this section, or 
by sec.sec.3.502, 3.503 (related to Video Carriage), or 3.504 (related to Audio 
Carriage), of the Act. The commission shall grant the waiver if it is in the 
public interest to do so. In determining the public interest, the commission 
must take into account whether the need for the restriction still exists in the 
market involved, but may consider other factors. The commission may revoke any 
waiver granted if it is shown that conditions under which the waiver was granted 
have materially changed and it is in the public interest to do so. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 25, 1996. 
 TRD-9605777 
  Paula Mueller 
 Secretary of the Commission 
 Public Utility Commission of Texas 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 458-0100 
         
                   
  TITLE 22. EXAMINING BOARDS 
 Part XI. Board of Nurse Examiners 
  Chapter 217. Licensure and Practice 
  
  22 TAC sec.217.2 
 
  The Board of Nurse Examiners proposes an amendment to sec.217.2, concerning 
Licensure by Examination for Graduates of Basic Nursing Education Programs. 
 The Board of Nurse Examiners spends considerable staff time and money 
processing applications on individuals who request authorization to write the 
National Council Licensure Examination for Registered Nurses (NCLEX-RN) who have 
a prior criminal conviction with grounds for denial. These applicants may 
currently avoid paying the $100 fee charged to Petitioners for a Declaratory 
Order. 
 The proposed amendment will eliminate the relitigation of these cases, all of 
which would have been declared ineligible to sit for the NCLEX-RN based upon a 
hearing before the Administrative Law Judge. The amendment will also cause the 
applicant to pay the same fee as Petitioners for a Declaratory Order. 
 Katherine A. Thomas, MN, RN, executive director, has determined that there will 
be no fiscal implications for state or local government as a result of enforcing 
or administering the rule. There will be no effect on local government nor 
businesses to comply with the rule. 
 Ms. Thomas also has determined that for each year of the first five years the 
rule as proposed will be in effect the public is not affected. 
 Written comments on the proposed amendment may be submitted to Katherine 
Thomas, Board of Nurse Examiners, Box 140466, Austin, Texas 78714. 
 The amendment is proposed under the Nursing Practice Act (Texas Civil 
Statutes), Article 4514, sec.1, which provides the Board of Nurse Examiners with 
the authority and power to make and enforce all rules and regulations necessary 
for the performance of its duties and conducting of proceedings before it and 
Article 4525(a) which authorizes the Board to refuse to admit persons to the 
licensing examination. 
 Articles 4519a and 4525(a) are affected by this amendment. 
 
 
  sec.217.2. Licensure by Examination for Graduates of Basic Nursing Education 
Programs. 
 
  (a) The requirements for licensure by examination are as follows: 
 
  (1) (No change.) 
   
  <nl>(2) Should it be ascertained from the application filed, or from other 
sources, that the applicant should have had an eligibility issue settled by way 
of a Petition for Declaratory Order, (see sec.213.30 of this Chapter relating to 
Declaratory Order of Eligibility for Licensure and Texas Civil Statutes, Article 
4519a) then the application will be treated and processed as a Petition for 
Declaratory Order and the applicant will be required to pay the appropriate fees 
for determination of eligibility which are not refundable. Should the Board 
finally determine that the individual is not eligible to be admitted to the 
examination, then that individual is precluded from again petitioning, or 
applying to the Board for admission to the examination except when the 
impediment to eligibility for licensure has been removed, such as when an 
applicant receives a full and unconditional pardon for prior criminal 
convictions. 
   
  <nl>(3)<ol>[(2)] verification of graduation, within four years of the date the 
application, from an accredited nursing program or certification from the 
nursing program director of completion of all baccalaureate degree requirements 
which are prerequisites of an accredited masters degree program leading to a 
first degree in professional nursing; and 
   
  <nl>(4)<ol>[(3)] passing the NCLEX-RN. 
     
  (b)-(c) (No change.) 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 25, 1996. 
 TRD-9605745 
  Katherine A. Thomas, MN, RN 
 Executive Director 
 Board of Nurse Examiners 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 305-6811 
         
             Chapter 219. Advanced <nl>Practice Nursing <ol> [Nurse 
Practitioner] Program 
  
  22 TAC sec.sec.219.1-219.3, 219.5, 219.6, 219.8, 219.11, 219.13, 219.15, 
219.18 
 
  The Board of Nurse Examiners proposes amendments to sec. s219.1-219.3, 219. 5, 
219.6, 219.8, 219.11, 219.13, 219.15, and 219.18 concerning Definitions, New 
Programs, Accreditation, Administration and Organization, Faculty 
Qualifications, Faculty Policies, Curriculum, Students, Clinical Resources, and 
Closing of a Program. The amendments are being proposed to conform with the APN 
title language which changed in 1995. The 74th Legislature changed the title of 
advanced nurse practitioner to advanced practice nurse. In addition to the 
proposed change in title and usage from "advanced nurse practitioner program" to 
"advanced practice nursing program", a change is proposed in rule 219.11(b) 
relating to curriculum that incorporates the Texas Higher Education Coordinating 
Board requirements for clinical nurse specialist and nurse practitioner 
education. 
 In 1995, the Board of Nurse Examiners (BNE), in collaboration with the Texas 
Higher Education Coordinating Board (THECB), developed curricular guidelines for 
advanced practice nurses. These curricular components will be required for CNS 
and NP programs by the BNE beginning in January, 1997. These requirements have 
been clearly communicated to nursing programs under the authority of the THECB. 
 The proposed amendments will bring the rule language of the Board into harmony 
with statutory language, and clarify curricular requirements of the Board for 
those advanced practice nursing programs accredited by the Board. 
 Katherine A. Thomas, MN, RN, executive director, has determined that for the 
first five-year period the sections are in effect there will be no fiscal 
implications for state or local government as a result of enforcing or 
administering the sections. 
 Ms. Thomas also has determined that for each year of the first five years the 
sections as proposed will be in effect the public is not affected. 
 Written comments on the proposed amendment may be submitted to Katherine 
Thomas, Board of Nurse Examiners, Box 140466; Austin, Texas 78714. 
 The amendments are proposed under the Nursing Practice Act (Texas Civil 
Statutes, Article 4514), sec.1, which provides the Board of Nurse Examiners with 
the authority and power to make and enforce all rules and regulations necessary 
for the performance of its duties and conducting of proceedings before it. 
 Article 4514, sec.8 is affected by these amendments. 
 
 
  sec.219.1. Definitions.  The following words and terms, when used in this 
chapter, shall have the following meanings, unless the context clearly indicates 
otherwise. 
   
   Accredited advanced <nl>practice nursing<ol> [nurse practitioner] program-An 
advanced educational program for registered nurses which has been accredited by 
the board or which has the accreditation of a national organization recognized 
by the board which prepares nurses to function as advanced <nl>practice 
nurses<ol> [nurse practitioners]. 
   
   Advanced <nl>practice <ol> nurse [practitioner]-A registered professional 
nurse, currently licensed in the State of Texas, who is prepared for advanced  
<nl>practice<ol> nursing [practice] by virtue of knowledge and skills obtained 
[through a post-basic or] <nl>in an<ol> advanced educational program of study 
acceptable to the board. The advanced <nl>practice<ol> nurse [practitioner] is 
prepared to practice in an expanded role to provide health care to individuals, 
families, and/or groups in a variety of settings including, but not limited to, 
homes, hospitals, institutions, offices, industry, schools, community agencies, 
public and private clinics, and private practice. The advanced <nl>practice<ol> 
nurse [practitioner] <nl>acts independently and/or in collaboration with other 
health care professionals in the delivery of health care services. <ol> 
[functions in a collegial relationship with other health care professionals 
making independent decisions about nursing needs and interdependent decisions 
with health care professionals regarding health regimens.] 
   
   Advanced <nl>practice nursing<ol> [nurse practitioner] program-A post-basic 
nursing educational program whose purpose it is to prepare advanced <nl>practice 
nurses<ol> [nurse practitioners] eligible to be recognized by the board as 
advanced<nl> practice nurse<ol> [nurse practitioners]. 
   
   Director-A registered nurse responsible for the administration of the 
advanced <nl>practice nursing<ol> [nurse practitioner] program and who meets the 
requirements as stated in sec.219.6(b) of this title (relating to Faculty 
Qualifications). 
   
   Preceptorship-That portion of the program consisting of clinical experiences 
under the auspices of qualified preceptors for the purpose of correlating theory 
to advanced <nl>practice <ol> nursing [practice] and for the purpose of 
attaining specific learning objectives. The setting shall provide an environment 
which permits observation and active participation in the delivery of health 
care. 
   
   Qualified preceptor -An advanced <nl>practice <ol> nurse [practitioner] 
currently recognized by the board who is practicing in an advanced nursing role, 
or a currently licensed, practicing physician or other health care professional 
acceptable to the board who is committed to the concept of the advanced 
<nl>practice <ol> [practitioner] nurse. The functions of the preceptor include 
supervision, teaching, and evaluation of student's performance in the clinical 
setting. 
 
   
  sec.219.2. New Programs. <ol> State accreditation by the Board of Nurse 
Examiners for advanced <nl>practice nursing<ol> [nurse practitioner] programs in 
Texas is voluntary. If state accreditation for an advanced <nl>practice 
nursing<ol> [nurse practitioner] program is desired, then this chapter would 
apply. 
 
  (1) Phase I: development of a new program. 
 
  (A) An institution wishing to establish an accredited advanced <nl>practice 
nursing<ol> [nurse practitioner] program shall advise the board of its intent in 
writing. 
   
  (B) (No change.) 
   
  (C) The proposal shall include the following information: 
 
  (i)-(ii) (No change.) 
   
  (iii) type of advanced <nl>practice nursing<ol> [nurse practitioner] program 
proposed; 
   
  (iv) documentation of the need for the advanced <nl>practice nursing<ol> 
[nurse practitioner] program in Texas with rationale for why the program should 
be established; 
   
  (v)  potential effect on other advanced <nl>practice nursing<ol> [nurse 
practitioner] programs in the area; 
   
  (vi) organizational structure of the educational institution showing the 
relationship of the proposed advanced  <nl>practice nursing<ol> [nurse 
practitioner] program within the organization; 
   
  (vii) (No change.) 
   
  (viii) tentative budget plans including evidence of financial resources 
adequate for planning, implementing, and continuing the [advanced nurse 
practitioner] program: 
   
  (ix)-(xii) (No change.) 
     
  (D)-(F) (No change.) 
   
  (G)  Following the site visit and public hearing, the board may approve, defer 
action or deny the request. 
 
  (i) Approval of the proposal to establish an advanced <nl>practice nursing 
<ol> [nurse practitioner] program will be given when the educational institution 
has submitted evidence that the advanced <nl>practice nursing<ol> [nurse 
practitioner] program will be based upon sound educational principles, that 
valid rationale has been documented for the establishment of the advanced 
<nl>practice nursing <ol> [nurse practitioner] program, that existing advanced  
<nl>practice nursing<ol> [nurse practitioner] programs would not be adversely 
affected and that the educational institution is prepared to meet the board's 
requirements as specified in sec.sec.219.1-219.17 of this title (relating to 
Definitions, New Programs, Accreditation, Philosophy and Objectives, 
Administration and Organization, Faculty Qualifications, Change of Director, 
Faculty Policies, Faculty Development and Evaluation, Program of Study, 
Curriculum, Curriculum Change, Students, Educational Resources and Facilities, 
Clinical Resources, Records and Reports, and Total Program Evaluation). 
   
  (ii) If approved, the institution will be notified in writing to proceed with 
the development of the advanced <nl>practice nursing<ol> [nurse practitioner] 
program as described in Phase II. 
   
  (iii)-(iv) (No change.) 
       
  (2) Phase II: application for initial accreditation. 
 
  (A) The director and faculty shall plan the program of learning. 
   
  (B) The director of the advanced <nl>practice nursing<ol> [nurse practitioner] 
program shall submit two copies of the application for initial accreditation to 
the board's office for staff review. 
   
  (C)-(E) (No change.) 
 
       
  sec.219.3. Accreditation. 
 
  (a) Types of accreditation. 
 
  (1) (No change.) 
   
  (2) Full accreditation. Full accreditation is granted to an advanced 
<nl>practice nursing<ol> [nurse practitioner] program after one class has 
completed the program and is based upon evidence that the program is continuing 
to meet the board's legal and educational requirements. 
   
  (3)-(4) (No change.) 
     
  (b) (No change.) 
   
  (c)  Accreditation procedure. The continuing accreditation status of each 
program shall be determined annually by the board either on the basis of a 
survey visit or review of annual report. 
 
  (1) Survey visit. Each advanced <nl>practice nursing<ol> [nurse practitioner] 
program will be visited at least every six years after full accreditation has 
been granted or at any time deemed necessary by the board. A written report of 
the visit together with the annual report submitted by the director will be 
reviewed by the board at a regularly scheduled meeting. The decision of the 
board concerning the accreditation status of the program will be sent to the 
director and the chief administrative officer of the controlling institution. 
   
  (2) (No change.) 
 
       
  sec.219.5. Administration and Organization. 
 
  (a) The advanced <nl>practice nursing <ol> [nurse practitioner] program shall 
be conducted by a college or university and should preferably be associated with 
a baccalaureate or higher degree nursing program. 
   
  (b)-(e) (No change.) 
 
     
  sec.219.6. Faculty Qualifications. 
 
  (a) Each nurse faculty member shall 
 
  (1)-(3) (No change.) 
   
  (4) be recognized as an advanced <nl>practice <ol> nurse [practitioner] by the 
board, if involved in clinical teaching and supervision. 
     
  (b) The director shall 
 
  (1) -(3) (No change.) 
   
  (4) have experience as an advanced <nl>practice <ol> nurse [practitioner] and 
be recognized by the board as an advanced <nl>practice<ol> nurse [practitioner]; 
and 
   
  (5) have teaching experience in a collegiate nursing program and/or advanced 
<nl>practice nursing <ol> [nurse practitioner] program. 
 
       
  sec.219.8. Faculty Policies. 
 
  (a) The faculty of the advanced <nl>practice nursing<ol> [nurse practitioner] 
program shall function under the same general policies that affect other faculty 
members in the institution; however, variations of these policies may be 
necessary because of the nature of the curriculum for which the faculty must 
have authority and responsibility. 
   
  (b)-(f) (No change.) 
 
     
  sec.219.11. Curriculum. 
 
  (a) (No change.) 
   
  (b) The curriculum content shall include: 
 
  (1) (No change.) 
   
  (2)  concepts and principles critical to advanced  <nl>practice<ol> nursing 
[practice]; 
   
  (3) professional and legal implications of the nurse in the advanced role; 
[and] 
   
  (4) knowledge and skills relevant to practice in the area of specialty[.]<nl>; 
and 
   
  <nl>(5) clinical nurse specialist and nurse practitioner course requirements 
published by the Texas Higher Education Coordinating Board in collaboration with 
the Board of Nurse Examiners that become effective January 1997. 
     
  (c) When clinical preceptorships are used in an advanced <nl> practice 
nursing<ol> [nurse practitioner] program, the following conditions shall be met: 
 
  (1) Written agreement(s) between the cooperating agency and advanced 
<nl>practice nursing<ol> [nurse practitioner] program shall delineate the 
functions and responsibilities of the parties involved. 
   
  (2)-(4) (No change.) 
 
       
  sec.219.13. Students. 
 
  (a) The number of students admitted to the advanced  <nl>practice nursing<ol> 
[nurse practitioner] program shall be determined by the number of qualified 
faculty and preceptors, adequate educational facilities and resources, and the 
availability of appropriate clinical learning experiences for students. 
   
  (b)-(d) (No change.) 
 
     
  sec.219.15. Clinical Resources. 
 
  (a) (No change.) 
   
  (b)  Cooperating agencies, which are used for 10% or more of the student's 
clinical laboratory in any given course, shall [be approved by the board prior 
to use by the program and shall meet the following requirements]: 
 
  (1)  <nl>be accredited/approved <ol> [accreditation/approval] by the 
appropriate authority; 
   
  (2) [a] <nl>be<ol> sufficient <nl>in<ol> number and variety of 
patients/clients to provide learning experiences for all students to achieve the 
stated objectives;  <nl>and 
   
  [(3) registered nurses or other health care professionals acceptable to the 
board directly supervising each clinical unit used for educational purposes; 
   
  [(4) a sufficient number of registered nurses and other health care 
professionals to ensure safe and continuous care of patients/clients; 
   
  [(5) conformance with accepted standards of nursing care and practice; and] 
   
  <nl>(3)<ol>[(6)] <nl>provide <ol> available space for clinical conferences. 
     
  (c)-(f) (No change.) 
 
     
  sec.219.18. Closing of a Program. 
 
  (a) When the decision to close an advanced <nl>practice nursing<ol> [nurse 
practitioner] program has been made, the director must notify the board and 
submit a written plan for terminating the program. 
   
  (b)-(e) (No change.) 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 25, 1996. 
 TRD-9605742 
  Katherine A. Thomas, MN, RN 
 Executive Director 
 Board of Nurse Examiners 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 305-6811 
         
             Chapter 221. Advanced Practice Nurses 
  
  22 TAC sec.221.3 
 
  The Board of Nurse Examiners proposes an amendment to sec.221.3, concerning 
Advanced Practice Nurses, Education. 
 The amendment is being proposed to reflect the appropriate APN title language 
which changed in 1995. The 74th Legislature changed the title of advanced nurse 
practitioner to advanced practice nurse. In addition to the proposed change in 
title and usage from "advanced nurse practitioner program" to "advanced practice 
nursing program", a change is proposed in rule 221.3(4) to incorporate the Texas 
Higher Education Coordinating Board (THECB) requirements for clinical nurse 
specialist (CNS) and nurse practitioner (NP) education. 
 In 1993, the Board of Nurse Examiners (BNE), in collaboration with the THECB, 
developed curricular guidelines for advanced practice nurses for CNS and NP 
roles and specialties. Nursing programs preparing CNSs and NPs are required to 
include specific courses within their curricula beginning January 1, 1997. 
 The proposed amendment will clarify that the nursing programs under the 
authority of the THECB must be in compliance with their accreditation 
requirements beginning January 1, 1997 and NP and CNS graduates must complete 
their courses for Board recognition after January 1, 1998. 
 Katherine A. Thomas, MN, RN, executive director, has determined that there will 
be no fiscal implications for state or local government as a result of enforcing 
or administering the rule. There will be no effect on local government nor 
businesses to comply with the rule. 
 Ms. Thomas also has determined that for each year of the first five years the 
rule as proposed will be in effect the public has increased assurance that the 
Board credentials qualified applicants. 
 Written comments on the proposed amendment may be submitted to Katherine 
Thomas, Board of Nurse Examiners, Box 140466; Austin, Texas 78714. 
 The amendment is proposed under the Nursing Practice Act (Texas Civil Statutes, 
Article 4514), sec.1, which provides the Board of Nurse Examiners with the 
authority and power to make and enforce all rules and regulations necessary for 
the performance of its duties and conducting of proceedings before it. 
 Article 4514, sec.8 is affected by this section. 
 
 
  sec.221.3. Education.  The registered professional nurse practicing as an 
advanced practice nurse shall have completed an advanced educational program of 
study appropriate to the practice area which meets the following criteria. 
 
  (1) The program of study shall meet the requirements for advanced <nl>practice 
nursing<ol> [nurse practitioner] programs according to sec.sec.219.1-219.14, 
Advanced <nl>Practice Nursing<ol> [Nurse Practitioner] Program of this title 
(relating to Definitions, New Programs, Accreditation, Philosophy and 
Objectives, Administration and Organization, Faculty Qualification, Change of 
Director, Faculty Policies, Faculty Development and Evaluation, Program of 
Study, Curriculum, Curriculum Change, Students, and Educational Resources and 
Facilities). 
   
  (2) (No change.) 
   
  (3) Programs of study in states other than Texas must meet the requirements of 
Chapter 219 of this title (relating to Advanced <nl>Practice Nursing<ol> [Nurse 
Practitioner] Program) and shall be accredited by the appropriate licensing body 
in that state or be accredited by a national accrediting body recognized by the 
board. 
   
  (4) The program of study shall be at least one academic year in length which 
may include a formal preceptorship.  <nl>For graduates after January 1, 1998, 
clinical nurse specialist and nurse practitioner programs shall have included 
the curricular requirements published by the Texas Higher Education Coordinating 
Board in collaboration with the Board of Nurse Examiners that become effective 
January 1, 1997. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 25, 1996. 
 TRD-9605743 
  Katherine A. Thomas, MN, RN 
 Executive Director 
 Board of Nurse Examiners 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 305-6811 
         
             Chapter 223. Fees 
  
  22 TAC sec.223.1 
 
  The Board of Nurse Examiners proposes an amendment to sec.223.1, concerning 
Fees. 
 The Board of Nurse Examiners spends considerable staff time and money 
processing applications on individuals who request authorization to write the 
National Council Licensure Examination for Registered Nurses (NCLEX-RN) who have 
a prior conviction. 
 The proposed amendment will cause these applicants to pay the same amount as 
those individuals who currently file a petition for a Declaratory Order seeking 
the same approval. Therefore, all eligibility cases will now pay the same fee. 
 Katherine A. Thomas, MN, RN, executive director, has determined that there will 
be no fiscal implications for state or local government as a result of enforcing 
or administering the rule. Applicants who seek eligibility will be required to 
pay the fee. There will be no effect on local government nor businesses to 
comply with the rule. 
 Ms. Thomas also has determined that for each year of the first five years the 
rule as proposed will be in effect the public is not affected; however, 
applicants will have to pay a fee where previously no fee was required. 
 Written comments on the proposed amendment may be submitted to Katherine 
Thomas, Board of Nurse Examiners, Box 140466; Austin, Texas 78714. 
 The amendment is proposed under the Nursing Practice Act (Texas Civil 
Statutes), Article 4514, sec.1, which provides the Board of Nurse Examiners with 
the authority and power to make and enforce all rules and regulations necessary 
for the performance of its duties and conducting of proceedings before it. 
 Article 4527 is affected by this section. 
 
 
  sec.223.1. Fees. The Board of Nurse Examiners has established reasonable and 
necessary fees for the administration of its functions in the following amounts: 
 
  (1)-(15) (No change.) 
   
  <nl>(16) eligibility determination -$100; 
   
  <nl>(17)<ol>[(16)] docketing fee in non disciplinary matters -$600; 
   
  <nl>(18)<ol>[(17)] Registered Nurse, Retired-$10. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 25, 1996. 
 TRD-9605744 
  Katherine A. Thomas, MN, RN 
 Executive Director 
 Board of Nurse Examiners 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 305-6811 
         
               Part XVI. Texas Board of Physical Therapy Examiners 
  Chapter 321. Definitions 
  
  22 TAC sec.321.1 
 
  The Texas Board of Physical Therapy Examiners proposes an amendment to 
sec.321.1, concerning Definitions. This amended section clarifies the 
relationship between the physical therapist and the physical therapist 
assistant. 
 John Maline, Executive Director of the Executive Council of Physical Therapy 
and Occupational Therapy Examiners, has determined that for the first five-year 
period the rule is in effect there will be no effect on state or local 
government. 
 Mr. Maline also has determined that for each year of the first five years the 
rule is in effect the public benefit anticipated as a result of enforcing the 
rule will be proper supervision of physical therapist assistants. There will be 
no effect on small businesses and there is no anticipated economic cost to 
persons having to comply with this rule. 
 Comments on the proposed rule may be submitted to Gerard Swain, PT Coordinator, 
Texas Board of Physical Therapy Examiners, 333 Guadalupe, Suite 2-510, Austin, 
Texas 78701. 
 The amendment is proposed under the Physical Therapy Practice Act, Texas Civil 
Statutes, Article 4512e, which provides the Texas Board of Physical Therapy 
Examiners with the authority to adopt rules consistent with this Act to carry 
out its duties in administering this Act. 
 Texas Civil Statutes, Article 4512e is affected by this amendment. 
 
 
  sec.321.1. Definitions. 
   
   Physical therapist assistant-The supervision of the physical therapist 
assistant shall include the following: 
 
  (A)-(B) (No change.) 
   
  (C) A current written plan of care will be formulated for each patient by the 
physical therapist. The plan of care shall be revised following periodic 
reevaluations by the physical therapist, not to exceed 30 days. <nl>The physical 
therapist is responsible for the content and validity of the discharge summary 
and must sign the discharge summary. 
   
  (D)-(E)  (No change.) 
   
  (F) The physical therapist assistant may not: 
 
  (i)  specify and/or perform definitive (decisive, conclusive, final) 
evaluative and assessment procedures;<nl> however physical therapist assistants 
may screen patients designated by the physical therapist by gathering 
information using a uniform predetermined format and reporting the findings on 
all patients screened to the physical therapist. Further intervention will be 
determined by the physical therapist. 
   
  (ii)-(iv)  (No change.) 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 29, 1996. 
 TRD-9605857 
  John P. Maline 
 Executive Director 
 Texas Board of Physical Therapy Examiners 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 305-6900 
         
               Chapter 329. Licensing Procedure 
  
  22 TAC sec.329.1 
 
  The Texas Board of Physical Therapy Examiners proposes an amendment to 
sec.329.1, concerning Licensing Procedures. This amended section requires 
applicants to complete and return to the board office an examination on rules 
published by the board. 
 John Maline, Executive Director of the Executive Council of Physical Therapy 
and Occupational Therapy Examiners, has determined that for the first five-year 
period the rule is in effect there will be no effect on state or local 
government. 
 Mr. Maline also has determined that for each year of the first five years the 
rule is in effect the public benefit anticipated as a result of enforcing the 
rule will be licensed physical therapists and physical therapist assistants who 
are knowledgeable of board rules, which will lead to a decrease in violations of 
the rules. There will be no effect on small businesses and there is no 
anticipated economic cost to persons having to comply with this rule. 
 Comments on the proposed rule may be submitted to Gerard Swain, PT Coordinator, 
Texas Board of Physical Therapy Examiners, 333 Guadalupe, Suite 2-510, Austin, 
Texas 78701. 
 The amendment is proposed under the Physical Therapy Practice Act, Texas Civil 
Statutes, Article 4512e, which provides the Texas Board of Physical Therapy 
Examiners with the authority to adopt rules consistent with this Act to carry 
out its duties in administering this Act. 
 Texas Civil Statutes, Article 4512e is affected by this amendment. 
 
 
  sec.329.1. General Licensing Procedure. 
 
  (a) (No change.) 
   
  (b) An applicant may apply for licensure as a physical therapist assistant if 
his or her educational credentials are determined to be equivalent to a U.S. 
physical therapy program. <nl>All applicants must demonstrate proficiency in the 
English Language. Applicants whose physical therapy course work has not been 
taught in English are required to take the Test of English as a Foreign Language 
(TOEFL), Test of Spoken English (TSE), and Test of Written English (TWE), as 
required in the Act, sec.8c. All three tests must be passed with the following 
minimum scores: TOEFL 580, TSE 55, AND TWE 5. 
   
  (c)-(f) (No change.) 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 29, 1996. 
 TRD-9605858 
  John P. Maline 
 Executive Director 
 Texas Board of Physical Therapy Examiners 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 305-6900 
         
           
  22 TAC sec.329.2 
 
  The Texas Board of Physical Therapy Examiners proposes an amendment to 
sec.329.2, concerning License by Examination. This amended section allows for 
the implementation of a computer based examination which can be taken at the 
applicant's convenience. 
 John Maline, Executive Director of the Executive Council of Physical Therapy 
and Occupational Therapy Examiners, has determined that for the first five-year 
period the rule is in effect there will be no effect on state or local 
government. 
 Mr. Maline also has determined that for each year of the first five years the 
rule is in effect the public benefit anticipated as a result of enforcing the 
rule will be the opportunity for applicants to take the board-approved 
examination on a day convenient for them instead of only on three days a year as 
set by the board. This will reduce the time an applicant must wait to receive a 
permanent license. There will be no effect on small businesses and there is no 
anticipated economic cost to persons having to comply with this rule. 
 Comments on the proposed rule may be submitted to Gerard Swain, PT Coordinator, 
Texas Board of Physical Therapy Examiners, 333 Guadalupe, Suite 2-510, Austin, 
Texas 78701. 
 The amendment is proposed under the Physical Therapy Practice Act, Texas Civil 
Statutes, Article 4512e, which provides the Texas Board of Physical Therapy 
Examiners with the authority to adopt rules consistent with this Act to carry 
out its duties in administering this Act. 
 Texas Civil Statutes, Article 4512e is affected by this amendment. 
 
 
  sec.329.2. License by Examination. 
 
  (a)-(b) (No change.) 
   
  (c) All completed applications and fees for license by examination must be 
received by the [deadlines set by the] board office prior to each examination. 
[Applicants are notified of the deadlines in the application package.] 
   
  (d) Should the board reject an application for license by examination, the 
examination fee will be <nl>returned <ol> [refunded]. 
   
  (e) (No change.) 
   
  (f) Examinations. The board will administer <nl>all <ol> [three written] 
examinations [annually] Oral and/or practical examinations will be scheduled as 
required at the discretion of the board. Use of dictionaries, translators, or 
any other supportive information will not be permitted. 
   
  (g) Examination score requirements. All [written] examinations will be 
prepared by a board-approved examination service. The board-approved examination 
service is Professional Examination Service (PES). All score reporting to the 
board will be done by the PES Interstate Reporting Service. For any examinations 
given on or after January 1, 1993, a passing score will be determined by the 
board for each examination. For all examinations given prior to January 1, 1993, 
a passing score shall be 1.5 standard deviation below the nationwide mean or 
higher. The applicant will be notified in writing of the scores and their pass 
or fail result. Upon receipt of notification of failure, the applicant is 
immediately ineligible to practice. 
   
  (h) (No change.) 
   
  (i) Examination guidelines. 
 
  (1) <nl>For Computer Based Testing the guidelines of the Federation of State 
Boards of Physical Therapy must be followed by all candidates.<ol> [Upon 
notification of the exam schedule, a candidate who will not be able to attend 
must submit the reason, in writing, for approval. A candidate who is scheduled 
to take the exam and is unable or fails to appear may be excused for: 
 
  [(A) illness, with a written statement from a physician; 
   
  [(B)  circumstances caused by acts of God, evidence acceptable to the board; 
   
  [(C) accident, evidence acceptable to the board; or 
   
  [(D)  other conditions as accepted by the board. 
     
  (2) If a candidate holds a temporary license awaiting Texas examination, and 
takes a <nl>written<ol> [board-approved] licensure examination in another state, 
the candidate will then be considered under the Act, sec.10. [If the candidate 
does not attend his or her scheduled Texas examination, the Texas temporary 
license shall be revoked the next working day following the Texas examination 
date. The revoked license must then be immediately returned to the board 
office.] 
   
  (3)-(5) (No change.) 
     
  (j)-(k) (No change.) 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 29, 1996. 
 TRD-9605859 
  John P. Maline 
 Executive Director 
 Texas Board of Physical Therapy Examiners 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 305-6900 
         
           
  22 TAC sec.329.3 
 
  The Texas Board of Physical Therapy Examiners proposes an amendment to 
sec.329.3, concerning Temporary Licensure for Examination Candidates. This 
amended section establishes the length of time that a temporary license is 
valid. 
 John Maline, Executive Director of the Executive Council of Physical Therapy 
and Occupational Therapy Examiners, has determined that for the first five-year 
period the rule is in effect there will be no effect on state or local 
government. 
 Mr. Maline also has determined that for each year of the first five years the 
rule is in effect the public benefit anticipated as a result of enforcing the 
rule will be the availability physical therapists and physical therapist 
assistants with temporary licenses. There will be no effect on small businesses 
and there is no anticipated economic cost to persons having to comply with this 
rule. 
 Comments on the proposed rule may be submitted to Gerard Swain, PT Coordinator, 
Texas Board of Physical Therapy Examiners, 333 Guadalupe, Suite 2-510, Austin, 
Texas 78701. 
 The amendment is proposed under the Physical Therapy Practice Act, Texas Civil 
Statutes, Article 4512e, which provides the Texas Board of Physical Therapy 
Examiners with the authority to adopt rules consistent with this Act to carry 
out its duties in administering this Act. 
 Texas Civil Statutes, Article 4512e is affected by this amendment. 
 
 
  sec.329.3. Temporary Licensure for Examination Candidates. 
 
  (a)  A temporary license may be issued to an examination candidate which is 
valid <nl>for 90 days <ol> from the date of issuance <nl>or<ol> until the score 
reports are received <nl>whichever occurs first<ol>. [A temporary license is 
issued no earlier than the day after the examination which precedes the 
examination for which the candidate is scheduled.] 
   
  (b) (No change. ) 
   
  (c) The examination is not complete until the score has been reported to the 
candidate. All previous takes of the physical therapy licensure examinations, 
regardless of locations, are counted toward the total number of takes for Texas 
licensure. A temporary license is void <nl>90 days from the date of issuance 
or<ol> upon the receipt of the scores of the [national] examination<nl>, 
whichever occurs first<ol>. The void temporary license must be returned 
immediately to the board office upon notification of failure of examination. 
   
  (d)-(e) (No change.) 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 29, 1996. 
 TRD-9605860 
  John P. Maline 
 Executive Director 
 Texas Board of Physical Therapy Examiners 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 305-6900 
         
           
  22 TAC sec.329.5 
 
  The Texas Board of Physical Therapy Examiners proposes an amendment to 
sec.329.5, concerning License Procedures for Foreign-Trained Applicants. This 
amended section sets the passing scores for the Test of Spoken English, Test of 
Written English, and the Test of English as a Foreign Language. 
 John Maline, Executive Director of the Executive Council of Physical Therapy 
and Occupational Therapy Examiners, has determined that for the first five-year 
period the rule is in effect there will be no effect on state or local 
government. 
 Mr. Maline also has determined that for each year of the first five years the 
rule is in effect the public benefit anticipated as a result of enforcing the 
rule will be the availability of qualified physical therapists to provide 
medical services. There will be no effect to small businesses. There is no 
anticipated economic cost to persons who are required to comply with the rule as 
proposed. 
 Comments on the proposed rule may be submitted to Gerard Swain, PT Coordinator, 
Texas Board of Physical Therapy Examiners, 333 Guadalupe, Suite 2-510, Austin, 
Texas 78701. 
 The amendment is proposed under the Physical Therapy Practice Act, Texas Civil 
Statutes, Article 4512e, which provides the Texas Board of Physical Therapy 
Examiners with the authority to adopt rules consistent with this Act to carry 
out its duties in administering this Act. 
 Texas Civil Statutes, Article 4512e is affected by this amendment. 
 
 
  sec.329.5. Licensing Procedures for Foreign-Trained Applicants. 
 
  (a)-(f) (No change.) 
   
  (g) Guidelines for board-approved education credentialing agencies. 
 
  (1) (No change.) 
   
  (2) The credentialing agency must attest that the institution attended by the 
applicant has the recognition of the Ministry of Education or the equivalent in 
that country. <nl>All applicants must demonstrate proficiency in the English 
Language. The credentialing review agency will certify if the applicant's 
physical therapy course work has been taught in English. Applicants whose 
physical therapy course work has not been taught in English are required to take 
the Test of English as a Foreign Language (TOEFL), Test of Spoken English (TSE), 
and Test of Written English (TWE), as required in the Act, Section 8c. All three 
tests must be passed with the following minimum scores: TOEFL 580, TSE 55, AND 
TWE 5. 
   
  (3)-(10) (No change.) 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 29, 1996. 
 TRD-9605861 
  John P. Maline 
 Executive Director 
 Texas Board of Physical Therapy Examiners 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 305-6900 
         
                   
  TITLE 25. HEALTH SERVICES 
 Part I. Texas Department of Health 
  Chapter 39. Primary Health Care Services Program 
  
  Clearinghouse for Primary Care Providers Seeking Collaborative Practice 
 
  25 TAC sec.sec.39.91-39.94 
 
  The Texas Department of Health (department) proposes new  ssec.39.91-39. 94, 
concerning establishment of a clearinghouse for primary care providers seeking 
collaborative practice opportunities in the state. The new sections are proposed 
through the provisions of the Health and Safety Code (HSC), sec.105.007, which 
directs the department to establish a clearinghouse for health professionals 
seeking collaborative practice. The clearinghouse will solicit and distribute 
information about physicians, nurse practitioners and physician assistants 
seeking opportunities for serving on a primary care team in settings such as 
rural health clinics, community health centers or private group practices. 
 The sections cover purpose and scope; define terms used in the rules; and 
describe the scope of clearinghouse activities, including establishment of a 
registry. 
 Debra Stabeno, Deputy Commissioner for Health Care Delivery, has determined 
that for the first five-year period the sections are in effect the fiscal 
implications for state government as a result of enforcing or administering the 
rules as proposed are anticipated to be negligible. There is no anticipated cost 
to local government as a result of enforcing or administering the sections as 
proposed. 
 Ms. Stabeno also has determined that for each year of the first five years the 
rules as proposed are in effect the public benefits will be an increased number 
of primary care health professionals working in collaborative practice in the 
state. There will be no economic effect on small or large businesses. There will 
be no costs to individuals to comply with the sections as proposed. Local 
employment could increase due to expanded employment opportunities for primary 
care providers as a result of clearinghouse activities. 
 Comments on the proposal may be submitted to Demetria Montgomery, M.D., Chief, 
Bureau of Community Oriented Primary Care, Texas Department of Health, 1100 West 
49th Street, Austin, Texas 78756, (512) 458-7771. Comments will be accepted for 
30 days after the publication of the proposed rules in the Texas Register. 
 The new sections are proposed under HSC, sec.105.007, which mandates the Texas 
Department of Health to establish a clearinghouse for health professionals 
seeking collaborative practice; and sec.12.001(b), which authorizes the Texas 
Board of Health to adopt rules for the performance of every duty imposed by law 
on the board, the department, and the commissioner of health. 
 These new sections will affect Health and Safety Code, Chapter 105. 
 
 
  sec.39.91. Purpose and Scope. 
 
  (a) Purpose. These sections implement the provisions of Health and Safety 
Code, sec.105.007 for the establishment and maintenance of a primary care 
provider clearinghouse for health professionals seeking opportunities for 
collaborative clinical practice. 
   
  (b) Scope. These sections describe the types of services to be provided by the 
clearinghouse and identify the criteria and procedures to be used by the Texas 
Department of Health in determining eligibility for inclusion among 
clearinghouse participants. 
 
     
  sec.39.92. Definitions.  The following words and terms, when used in these 
sections, shall have the following meanings, unless the context clearly 
indicates otherwise. 
   
   Board-The Texas Board of Health. 
   
   Department-The Texas Department of Health. 
   
   Federally qualified health centers-Primary care clinics receiving federal 
funding under the Public Health Service Act, 42 United States Code, 
sec.sec.254b, 254c, or 254d. 
   
   Primary care provider-A physician with an unrestricted, active license issued 
by the Texas State Board of Medical Examiners who practices or plans to practice 
in the following specialty areas: family/general practice, general pediatrics, 
general internal medicine or obstetrics/gynecology; a nurse practitioner with an 
unrestricted, active license as a registered nurse and certification in advanced 
practice nursing by the Texas Board of Nurse Examiners who practices or plans to 
practice in any of the following specialty areas: women's health, pediatrics, 
family health, school health, or adult health; or a physician assistant with an 
unrestricted, active license issued by the Texas State Board of Physician 
Assistant Examiners who practices or plans to practice in one of the following 
specialty areas: family/general medicine, general pediatrics, general internal 
medicine, or obstetrics/gynecology. 
   
   Rural health clinics-Primary care clinics certified under Public Law 95-210 
by the Health Care Financing Administration of the United States Department of 
Health and Human Services. 
 
   
  sec.39.93. Scope of Clearinghouse Activities. The primary function of the 
clearinghouse is to assist primary care providers in identifying other primary 
care providers who are seeking to establish collaborative practices in Texas. 
Physicians may seek nurse practitioners or physician assistants to join their 
practices, and nurse practitioners or physician assistants may seek physicians 
with whom they can establish collaborative practice arrangements through 
physicians' orders, standing medical orders, standing delegation orders, or 
other formal written orders or protocols, as specified by rules of the Texas 
State Board of Medical Examiners. The clearinghouse will solicit and disseminate 
information from a registry containing information on primary care providers 
seeking opportunities to serve on a primary care team in settings such as rural 
health clinics, federally qualified health centers, or private group practices. 
 
   
  sec.39.94. Establishment of a Registry of Primary Care Providers Seeking 
Collaborative Practice Opportunities. 
 
  (a) The clearinghouse, as defined in sec.39.93 of this title (relating to 
Scope of Clearinghouse Activities), shall establish a registry containing the 
names, mailing addresses, phone numbers, primary specialty information, 
preferred practice setting, preferred practice location, and other pertinent 
information for primary care providers seeking collaborative practice 
opportunities with other primary care providers. Individuals will be identified 
for inclusion on the registry through their submission of an official 
application form to the department. 
   
  (b) The department will attempt to verify the licensure status of each 
applicant through the Texas State Board of Medical Examiners, Texas State Board 
of Physician Assistant Examiners, or Texas Board of Nurse Examiners, as 
appropriate. 
   
  (c) The department will notify the applicant in writing if the: 
 
  (1) applicant has been approved for addition to the registry; 
   
  (2) application is insufficient; or 
   
  (3) applicant does not qualify for inclusion in the registry. 
     
  (d) If an applicant is disapproved, the applicant may request informal 
reconsideration of the determination by submitting a written request to Chief, 
Bureau of Community Oriented Primary Care, Texas Department of Health, 1100 West 
49th Street, Austin, Texas 78756 within ten working days of the postmarked date 
of the department's notice of disapproval. 
   
  (e) The names and other pertinent information concerning approved applicants 
will be placed on the registry for a four-month period. The department will make 
additions and deletions to the registry only during the first week of each 
month. Information received during the second through fourth weeks of the month 
regarding additions, changes, or deletions to the registry will be processed 
during the first week of the following month. 
   
  (f) A person must reapply in accordance with subsection (a) of this section in 
order to remain on the registry after the initial four-month period. The 
department will mail renewal notices to notify individuals of the pending 
withdrawal of their names from the registry and of their opportunity to reapply 
for continued inclusion on the registry. 
   
  (g) Any individual may request access to the information maintained on the 
registry by submission of a request form from the department, and upon payment 
of applicable copying charges. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be a valid exercise of the agency's authority. 
 Issued in Austin, Texas, on April 29, 1996. 
 TRD-9605870 
  Susan K. Steeg 
 General Counsel 
 Texas Department of Health 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 458-7236 
         
               Chapter 169. Zoonosis Control 
  
  Rabies Control and Eradication 
 
  25 TAC sec.sec.169.22, 169.26, 169.27, 169.29 
 
  The Texas Department of Health (department) proposes amendments to 
sec.sec.169.22, 169.26, 169.27, and 169.29, concerning the control of rabies. 
Specifically, the sections cover definitions, facilities for the quarantining of 
animals, quarantine methods and testing, and vaccination requirements. The 
amendments define domestic ferret, add feeding and maintenance requirements for 
quarantined ferrets, amend the observation period for animals which have bitten 
humans, and require vaccination of dogs and cats released from animal shelters. 
 Dr. Keith A. Clark, Director, Zoonosis Control Division, has determined that 
for the first five-year period that the sections are in effect there will be no 
fiscal implications to state or local government as a result of enforcing or 
administering the sections as proposed. 
 Dr. Clark also has determined that for each year of the first five years the 
sections are in effect, the public benefit anticipated as a result of enforcing 
or administering the sections will be the humane treatment of ferrets. Some 
animal shelters may have minimal expenses due to purchasing water bottles for 
ferrets. There are no anticipated cost to persons who are required to comply 
with the sections as proposed. There will be no impact on local employment. 
 Comments may be submitted to Dr. Keith A. Clark, Director, Zoonosis Control 
Division, 1100 West 49th Street, Austin, Texas 78756, (512) 458-7255. Comments 
on the proposed rules will be accepted for 30 days following publication in the 
Texas Register. 
 The amendments are proposed under the Texas Health and Safety Code, Chapter 
826, sec.826.011, which provides the board with the authority to administer the 
rabies control program and adopt rules necessary to effectively administer this 
program; and  s12.001, which provides the Texas Board of Health with the 
authority to adopt rules for the performance of every duty imposed by law on the 
Texas Board of Health, the Texas Department of Health, and the Commissioner of 
Health. 
 These amendments affect Texas Health and Safety Code, Chapter 826. 
 
 
  sec.169.22. Definitions.  The following words and terms, when used in this 
chapter, shall have the following meanings, unless the context clearly indicates 
otherwise. 
   
     <nl>Domestic ferret -Any Mustela putorius furo. 
   
   Observation period -The time following a bite incident during which the 
biting animal's health status must be monitored. The observation period for 
domestic dogs and cats (only) is 10 days<nl>; the observation period for other 
animals, not including those defined as high risk or low risk, is 30 days<ol>. 
 
   
  sec.169.26. Facilities for the Quarantining of Animals. 
 
  (a)-(d) (No change.) 
   
  (e) Feeding. 
 
  (1) (No change.) 
   
  <nl>(2) Domestic ferrets shall have 24-hour access to food. The food shall be 
free from contamination, wholesome, palatable, and of sufficient quality and 
nutritive value to meet the normal daily requirements for the condition, size, 
and age of the domestic ferret. 
   
  <nl>(3)<ol>[(2)] Food receptacles shall be accessible to all dogs<nl>,<ol> 
[and] cats<nl>, and domestic ferrets<ol> and shall be located so as to minimize 
contamination by excreta. Feeding pans <nl>or bowls <ol> shall be durable and 
kept clean and sanitary. Disposable food receptacles may be used but must be 
discarded after each feeding <nl>or for domestic ferrets, after 24 hours of use 
<ol>. Self feeders may be used for the feeding of <nl>dry pet foods <ol> [dog 
food], and shall be kept clean and sanitary to prevent molding, deterioration, 
or caking of feed. 
     
  (f) Watering. If potable water is not accessible to [the] dogs and cats at all 
times, it shall be offered to them at least twice daily for periods of not less 
than one hour, except as directed by a licensed veterinarian. <nl>Domestic 
ferrets shall have potable water accessible at all times, provided in drinking 
bottles of appropriate size to maintain a fresh supply. <ol> Watering 
receptacles shall be kept clean and sanitary. 
   
  (g)-(h) (No change.) 
 
     
  sec.169.27. Quarantine Method and Testing. 
 
  (a) When a domestic dog<nl>,<ol> [or] cat<nl>, or ferret <ol> which has bitten 
a human has been identified, the owner or custodian will be required to place 
the animal in quarantine. Unvaccinated animals should not be vaccinated against 
rabies during the observation period. The [10-day] observation period will begin 
on the day of the bite incident. The animal must be placed in a Texas Department 
of Health (department) approved facility specified by the local rabies control 
authority and observed at least twice daily. However, the owner or custodian of 
the animal may request permission from the local rabies control authority for 
home quarantine if the following criteria can be met. 
 
  (1)-(4) (No change.) 
     
  (b)-(h) (No change.) 
 
     
  sec.169.29. Vaccination Requirement. 
 
  (a) The owner <nl>or custodian (excluding animal shelters)<ol> of each dog or 
cat shall have the dog or cat vaccinated against rabies at three months of age 
or earlier as prescribed by the United States Department of Agriculture (USDA) 
and within each subsequent 12-month interval thereafter. Only USDA-licensed 
rabies vaccines with a three-year duration of immunity in dogs or a vaccine 
which has been licensed for less than two years, and for which testing to obtain 
approval for three-year duration of immunity is in progress, may be used 
according to label directions in any species for which it is approved. 
   
  (b) (No change.) 
   
  (c) A copy of each [official] rabies vaccination certificate issued shall be 
retained by the issuing veterinarian in a readily retrievable status for a 
period of not less than three years from the date of issuance. 
   
  (d) (No change.) 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be a valid exercise of the agency's authority. 
 Issued in Austin, Texas, on April 29, 1996. 
 TRD-9605871 
  Susan K. Steeg 
 General Counsel 
 Texas Department of Health 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 458-7236 
         
                 Part II. Texas Department of Mental Health and Mental 
Retardation 
  Chapter 404. Protection of Clients and Staff 
  
  Subchapter F. Rights of Individuals Receiving Mental Retardation Services 
 
  25 TAC sec.sec.404.201-404.211 
 
  The Texas Department of Mental Health and Mental Retardation (TDMHMR) proposes 
new sec.sec.404.201-404.211 of Chapter 404, Subchapter F, concerning Rights of 
Individuals Receiving Mental Retardation Services. 
 The new subchapter describes the rights guaranteed under the Texas Health and 
Safety Code, Title 7, Subtitle D (Persons with Mental Retardation Act) to 
individuals receiving mental retardation services through state facilities, 
local mental retardation authorities, their subcontractors, and designated 
providers, and the rights of those individuals' legally authorized 
representatives. The subchapter mandates the use of two handbooks, one for 
individuals receiving services in state facilities and one for individuals 
receiving services in community settings. The handbooks explain in simple and 
non-technical language the key rights of individuals and of their legally 
authorized representatives. The appropriate handbook is required to be 
distributed by all service providers to individuals receiving services in those 
settings and to the legally authorized representatives of those individuals. 
 Chapter 405, Subchapter Y of this title (relating to Client Rights-Mental 
Retardation Services), concerning the same matters, is proposed 
contemporaneously for repeal in this issue of the Texas Register. The repeal of 
the subchapter would facilitate the reorganization of chapters and subchapters 
within the department's portion of the Texas Administrative Code. 
 Donald C. Green, chief financial officer, has determined that for the first 
five-year period the sections as proposed are in effect there will be no 
significant fiscal impact on state or local government as a result of enforcing 
or administrating the sections. 
 Pam Carley, director, Consumer Services and Rights Protection, has determined 
that for each year of the first five years the sections as proposed are in 
effect the public benefit anticipated as a result of enforcing the provisions is 
the availability of a comprehensive and accurate delineation of the rights of 
individuals receiving mental retardation services through the department and of 
their legally authorized representatives. There will be no significant fiscal 
impact on small businesses. There is no anticipated economic cost to persons who 
are required to comply with the sections as proposed. 
 Written comments on the proposal may be sent to Linda Logan, director, Policy 
Development, Texas Department of Mental Health and Mental Retardation, P.O. Box 
12668, Austin, Texas 78711-2668, or faxed to (512) 206-4750 within 30 days of 
publication. Questions concerning the content of the sections should be directed 
to Pam Carley, director, Consumer Services and Rights Protection. 
 These sections are proposed under the Texas Health and Safety Code, sec.532. 
015, which provides the Texas Mental Health and Mental Retardation Board with 
broad rulemaking authority. 
 These sections would affect the Texas Health and Safety Code, sec.592.002 and 
sec.592.040. 
 
 
  sec.404.201. Purpose.  The purpose of this subchapter is to: 
 
  (1) provide to individuals receiving mental retardation services and their 
legally authorized representatives: 
 
  (A) a listing of the rights guaranteed under the Texas Health and Safety Code, 
Title 7, Subtitle D (Persons with Mental Retardation Act); and 
   
  (B) the assurance that these rights must and will be made known to them; 
     
  (2) require that other key rights, benefits, and responsibilities be 
communicated, both orally and in writing, in plain and simple language to 
individuals receiving mental retardation services, and, when applicable, to 
their legally authorized representative; 
   
  (3) ensure that functions to support the rights of individuals receiving 
mental retardation services and their legally authorized representatives are 
accomplished; and 
   
  (4) ensure that employees of facilities, local authorities, their 
subcontractors, and designated providers are aware of the rights of individuals 
receiving mental retardation services and the rights of those individuals' 
legally authorized representatives in order to assist in the exercising of those 
rights. 
 
     
  sec.404.202. Application.  The provisions of this subchapter shall apply to 
each of the following in which mental retardation services are provided: 
 
  (1) facilities of the Texas Department of Mental Health and Mental Retardation 
and their subcontractors; 
   
  (2) local authorities and their subcontractors; and (3) designated providers. 
 
     
    s403.203. Definitions. The following words and terms, when used in this 
subchapter, shall have the following meanings, unless the context clearly 
indicates otherwise: 
   
   Department-The Texas Department of Mental Health and Mental Retardation. 
   
   Designated provider -As defined in the Texas Health and Safety Code, 
sec.534.054, a service provider with whom the department contracts for the 
delivery of a specific community-based mental health or mental retardation 
service in a specified local service area of the state. The term does not 
include a local authority. 
   
   Direct contact -An employment position in which a person is regularly 
assigned to a unit or program in which he or she has contact with persons 
served. 
   
   Facility-A state school or state center which provides mental retardation 
services, including community-based programs. 
   
   Individual-An individual who has received or is receiving mental retardation 
services provided by a facility, local authority, or any program contracting 
with these entities. 
   
   Legally adequate consent (informed consent)-A term consistent with provisions 
of the Texas Health and Safety Code, Title 7, sec.591.006 concerning consent 
obtained from an individual with mental retardation which is legally adequate 
when each of the following conditions has been met: 
 
  (A) legal status: The individual giving the consent is of the minimum legal 
age and has not had a guardian appointed to manage personal affairs by an 
appropriate court of law; 
   
  (B) comprehension of information: The individual giving the consent has been 
informed of and comprehends the nature, purpose, consequences, risks, and 
benefits of and alternatives to the procedure, and the fact that withholding or 
withdrawal of consent shall not prejudice the future provision of care and 
services to the individual with mental retardation; and 
   
  (C) voluntariness: The consent has been given voluntarily and free from 
coercion and undue influence. 
     
   Legally authorized representative-The parent of an individual who is a minor, 
the guardian of an individual who has been determined by a court to lack 
capacity, or the managing conservator of an individual. 
   
   Local authority -As defined in the Texas Health and Safety Code, sec.531.002, 
an entity to which the Texas Mental Health and Mental Retardation Board 
delegates its authority and responsibility within a specified region for 
planning, policy development, coordination, and resource development and 
allocation and for supervising and ensuring the provision of mental retardation 
services to individuals with mental retardation in one or more local service 
areas. 
   
   Mental retardation facility-The state schools and state centers which provide 
mental retardation services. 
   
   Mental retardation services-Programs and assistance for persons with mental 
retardation that may include a determination of mental retardation, 
interdisciplinary team recommendations, education, special training, 
supervision, care, treatment, rehabilitation, residential care, and counseling, 
but does not include those services or programs that have been explicitly 
delegated by law to other state agencies. 
   
   Residential services -Twenty-four hour services including domiciliary 
services, provided and/or contracted by the department or a local authority or 
designated provider which are directed toward enhancing the health, welfare, and 
development of persons with mental retardation. 
 
   
  sec.404.204. Rights of All Individuals Receiving Mental Retardation Services. 
 
  (a) Individuals receiving mental retardation services from facilities, local 
authorities, their subcontractors and designated providers have the following 
rights as required by the Persons with Mental Retardation Act, Health and Safety 
Code, Title 7, Subtitle D, and by other state and federal laws and rules as 
noted. 
 
  (1) All rights, benefits, responsibilities, and privileges guaranteed by the 
constitutions and laws of the United States and Texas, except where lawfully 
restricted. These rights include, but are not limited to, the right to impartial 
access to treatment, regardless of race, nationality, religion, sex, ethnicity, 
age, or disability; the right to petition for habeas corpus; the right to 
register and vote at elections; the right to acquire, use, and dispose of 
property including contractual rights; the right to equal housing opportunities; 
the right to sue and be sued; all rights relating to the granting, use, and 
revocation of licenses, permits, privileges and benefits under law; the right to 
religious freedom; and rights concerning domestic relations. 
   
  (2) The right to be free from mistreatment, abuse, neglect, and exploitation. 
See Texas Administrative Code, Title 40, Chapter 710, Subchapter A (relating to 
Abuse and Neglect of Persons Served by TXMHMR Facilities) and Chapter 710, 
Subchapter B relating to Client Abuse and Neglect in Community Mental Health and 
Mental Retardation Centers). 
   
  (3) The right to live and receive services in the least restrictive setting 
that is available and appropriate to an individual's needs and abilities, and to 
be treated and served in the least intrusive manner appropriate to the 
individual's. This includes the right to choose from a variety of living 
situations including living alone, in a group home, with a family, or in a 
supervised, protective environment. See 45 CFR sec.sec.84.4(b)(1)(iv), 
84.4(b)(2), and 84.52(a)(5). 
   
  (4) The right to publicly supported educational services, including those 
services provided under the Education Code, that are appropriate to the 
individual's needs. See 45 CFR Part 100b, Parts 121a and 121m. 
   
  (5) The right to equal opportunity in employment and the right to fair 
compensation for labor performed for the facility or local authority or their 
subcontractors or for a designated provider (regardless of any direct or 
incidental therapeutic value to the individual) in accordance with the Fair 
Labor Standards Act. See 45 CFR sec.sec.84.1 et seq; 45 CFR sec.sec.85.1 et seq; 
41 CFR sec.sec.60-741.1; Human Resources Code  ssec.121.00-121.009; Fair Labor 
Standards Act; Texas Civil Statutes, Article 5159d; Americans with Disabilities 
Act; "The Fair Labor Standards Act (FLSA) and Subminimum Wages," FYI, February 
11, 1991. 
   
  (6)  The right to a determination of mental retardation, the right to an 
administrative hearing to contest the findings of such a determination, and the 
right to an independent evaluation and determination performed at the expense of 
the individual, parent or legally authorized representative. See Chapter 403, 
Subchapter N of this title (relating to Administrative Hearings Arising Under 
the Persons With Mental Retardation Act) and Chapter 405, Subchapter D of this 
title (relating to Determination of Mental Retardation and Appropriateness for 
Admission to Mental Retardation Services). 
   
  (7)  The right to presumption of mental competency in the absence of a 
judicial determination to the contrary. 
   
  (8) The right to due process in guardianship proceedings, admission to 
residential services, and proposed or refused transfers or discharges (except 
when such discharge is on the basis that the individual is not mentally 
retarded). See Chapter 402, Subchapter F of this title (relating to Continuity 
of Services-Mental Retardation Campus-Based Components). 
   
  (9) The right to the provision of services in a way that does not discriminate 
on the basis of race, religion, sex, ethnicity, nationality, age, or disability. 
   
  (10) The right to participate actively in the development and periodic review 
of an individualized treatment plan. If possible, the individual and legally 
authorized representative, if appropriate, shall be given the opportunity to 
choose from several appropriate alternative services available from a service 
provider. 
   
  (11) The right to be free from unnecessary or excessive medication, which 
includes the right to give or withhold informed consent to treatment with 
psychoactive medication, unless the right has been limited by court order or in 
an emergency. This right may be limited only in accordance with the provisions 
of Chapter 405, Subchapter I of this title (relating to Consent to Treatment 
with Psychotropic Medications-Mental Retardation Facilities for those 
individuals residing in facilities. 
   
  (12) The right to treatment (exceptions to this right must be in accordance 
with applicable laws, standards, or department rules, and must be fully 
explained to the individual and the person authorized to give consent, if 
applicable), and the right to withdraw consent at any time in any matter in 
which the individual receiving services has previously granted consent, without 
limiting or compromising access to services or other treatments. 
   
  (13) The right to initiate a complaint. This includes being informed of how to 
contact the facility or local authority rights protection officer, the facility 
or local authority public responsibility committee, and the Office of Consumer 
Services and Rights Protection in Central Office (toll-free telephone number 1-
800-252-8154). See Chapter 410, Subchapter B (relating to Public Responsibility 
Committees). 
   
  (14) The right to have these rights and any additional rights explained in a 
way the individual served can understand upon admission to mental retardation 
services and upon request. This includes the right to be informed promptly of 
any changes in policies, procedures, or practices regarding an individual's 
rights. 
   
  (15) The right to have access to information contained in one's own record 
except where such access is limited by statute or department rule. Access to 
information shall be granted in accordance with 45 CFR Part 100b, Parts 121a and 
121m; Individuals with Disabilities Education Act (IDEA), formerly known as the 
Education of Handicapped Children Act; and Chapter 403, Subchapter K of this 
title (relating to Client-Identifying Information). 
   
  (16) The right to confidentiality of records and the right to be informed of 
conditions under which information can be disclosed without the individual's 
consent. Client-identifying information shall be disclosed in accordance with 
Chapter 403, Subchapter K of this title (relating to Client-Identifying 
Information). 
   
  (17) The right to request and be discharged from voluntary mental retardation 
services unless a court determines that the individual cannot be discharged 
without endangering the safety of the individual or others and issues a 
protective custody order. 
     
  (b) Individuals receiving mental retardation services from a facility or a 
local authority or their subcontractors or from a designated provider may have 
additional rights, benefits, and responsibilities depending on the program's 
affiliation with other federal entitlement programs and outside entities. Key 
rights, benefits, and responsibilities (grouped by program affiliation) are 
outlined in the department's rights handbook, which is discussed in sec.404.205 
of this title (relating to Rights Handbook for Individuals Receiving Mental 
Retardation Services). 
 
     
  sec.404.205. Rights of Parents or Conservators of Minors and Legal Guardians. 
 
  (a) The parent or conservator of a minor child who is receiving mental 
retardation services has the right to make decisions on the child's behalf. 
   
  (b) The legal guardian of an individual receiving mental retardation services 
has the right to make decisions on the individual's behalf as granted by the 
terms of the guardianship. 
   
  (c)  The parent or conservator of a minor child receiving mental retardation 
services and the guardian of an individual receiving mental retardation services 
from a facility or a local authority or their subcontractors or from a 
designated provider have the following rights as required by the Persons with 
Mental Retardation Act, Texas Health and Safety Codes, Subtitle D, and by other 
state and federal laws and rules as noted. 
 
  (1) The right to participate actively in the development and periodic review 
of an individualized treatment plan. 
   
  (2) The right to initiate a complaint on behalf of the individual. This 
includes being informed of how to contact the facility or local authority rights 
protection officer, the facility or local authority public responsibility 
committee, and the Office of Consumer Services and Rights Protection in Central 
Office (toll-free telephone number 1-800-252-8154). See Chapter 410, Subchapter 
B (relating to Public Responsibility Committees). 
   
  (3) The right to have these rights and any additional rights explained in a 
way the parent, conservator, or guardian can understand upon admission to mental 
retardation services and upon request. This includes the right to be informed 
promptly of any changes in policies, procedures, or practices regarding the 
rights of an individual or the individual's parent, conservator, or guardian. 
   
  (4) The right to have access to information contained in the individual's 
record except where such access is limited by statute or department rule. Access 
to information shall be granted in accordance with 45 CFR Part 100b, Parts 121a 
and 121m; Individuals with Disabilities Education Act (IDEA), formerly known as 
the Education of Handicapped Children Act; and Chapter 403, Subchapter K of this 
title (relating to Client-Identifying Information). 
   
  (5) The right to confidentiality of records and the right to be informed of 
conditions under which information can be disclosed without the consent of the 
individual and any legally authorized representative. Client-identifying 
information shall be disclosed in accordance with Chapter 403, Subchapter K of 
this title (relating to Client-Identifying Information). 
   
  (6) The right to request the discharge of the individual and to have that 
individual discharged from voluntary mental retardation services unless a court 
determines that the individual cannot be discharged without endangering the 
safety of the individual or others and issues a protective custody order. 
     
  (d) The parent or conservator of a minor child and the guardian of an 
individual receiving mental retardation services from a facility or a local 
authority or their subcontractors or from a designated provider may have 
additional rights, benefits, and responsibilities depending on the program's 
affiliation with other federal entitlement programs and outside entities. Key 
rights, benefits, and responsibilities (grouped by program affiliation) are 
outlined in the department's rights handbook, which is discussed in sec.404.206 
of this title (relating to Rights Handbook for Individuals Receiving Mental 
Retardation Services). 
 
     
  sec.404.206. Rights Handbook for Individuals Receiving Mental Retardation 
Services. 
 
  (a) The department will publish two rights handbooks which will contain 
interpretations written in simple and non-technical language of the key rights, 
benefits, and responsibilities of individuals receiving mental retardation 
services. 
 
  (1) Your Rights as a Person with Mental Retardation Receiving Services in a 
State Facility will be distributed by each state facility to individuals 
receiving services in that facility and to their legally authorized 
representatives. 
   
  (2)  Your Rights as a Person with Mental Retardation Receiving Services in the 
Community will be distributed by local authorities, their contractors, and 
designated providers to individuals receiving services in those settings and to 
their legally authorized representatives. 
     
  (b) The rights, benefits, and responsibilities outlined in the handbooks will 
be grouped by program affiliation, where appropriate, and will include those 
afforded by: 
 
  (1)  ICF/MR Intermediate Care Facilities for the Mentally Retarded Program 
standards; 
   
  (2) Consumer Principles for Evidentiary Certification in the Home and 
Community-Based Services Program; 
   
  (3) Consumer Principles for Evidentiary Certification in the Home and 
Community-Based Services-OBRA Program 
   
  (4) Texas Health and Safety Code, Title 7, Subtitle D, Persons with Mental 
Retardation Act; 
   
  (5) Texas Constitution; and 
   
  (6) United States Constitution. 
     
  (c) The handbooks will be printed in English and Spanish, and must be made 
available in any other language used by a significant percentage of the service 
area's population. All translations will be made available in accessible 
formats. 
   
  (d) The appropriate handbook will be distributed to individuals admitted to 
department facilities, local authorities, or their subcontractors, and to those 
receiving services through a designated provider. The parent, conservator, or 
guardian of an individual will be given a copy of the handbook. 
   
  (e) A sufficient number of the appropriate handbook will be kept on hand by 
each service provider in order that a copy may be made readily available to 
anyone requesting one. Copies of the handbook will be displayed prominently and 
at all times in dayrooms, recreation rooms, and other gathering places 
frequented by individuals, their family members, and legally authorized 
representatives. 
   
  (f) Each handbook distributed must include the toll free number of the Office 
of Consumer Services and Rights Protection (1-800-252-8154); the name, telephone 
number, and mailing address of the rights protection officer, and the mailing 
address of the public responsibility committee for the facility or local 
authority from which it is distributed. 
   
  (g) The handbook will be reviewed and revised by the Office of Consumer 
Services and Rights Protection as necessary. 
   
  (h) Nothing in this section shall preclude the distribution of additional 
brochures of a similar nature prepared by the facility, local authority, their 
subcontractors, or designated providers, or advocacy organizations. 
   
  (i) Individual copies of the handbooks may be obtained by contacting the 
Office of Consumer Services and Rights Protection, Texas Department of Mental 
Health and Mental Retardation, P.O. Box, 12668, Austin, Texas 78711-2668. 
Multiple copies can be purchased through the Central Office Print Shop. 
 
     
  sec.404.207. Communication of Rights to Individuals Receiving Mental 
Retardation Services. 
 
  (a) Upon admission, each newly admitted individual and any legally authorized 
representative shall receive a copy of the appropriate rights handbook. In 
addition, the individual and any legally authorized representative shall have 
these rights explained in a language they can understand in plain and simple 
terms. The notification will include an explanation that rights may be limited 
in certain circumstances, an explanation of due process procedures for such 
limitations, and an explanation of how a complaint may be filed. If the 
individual is manifestly unable to comprehend the rights as described in the 
handbook and verbally explained, notice given solely to the legally authorized 
representative is sufficient. 
   
  (b) Any changes in policies, procedures, or practices regarding an 
individual's rights shall be communicated promptly to the individual and any 
legally authorized representative. 
   
  (c) The method used to convey any information should be designed for effective 
communication, tailored to meet each person's ability to comprehend, and 
responsive to any visual or hearing impairment. Any explanations of rights shall 
be documented. 
   
  (d) If the individual is manifestly unable to comprehend the rights as 
described in the handbook and verbally explained and has no legally authorized 
representative, notice of these rights shall be given to another person who is 
actively involved in the individual's life. 
 
     
  sec.404.208. Rights Protection Officer at Department Facilities and Local 
Authorities. 
 
  (a) Each facility and local authority shall appoint a rights protection 
officer. 
   
  (b) The name, telephone number, and mailing address of the rights protection 
officer must be available in every program or residential area frequented by 
service recipients. Individuals must be insured access to telephones at the 
facility, local authority, subcontractor, or designated provider for purposes of 
contacting the rights protection officer. 
   
  (c) Duties required of the rights protection officer are specified at the 
discretion of the head of the facility or local authority but must include the 
following: 
 
  (1) receiving complaints of violations of rights, allegations of inadequate 
provision of services, and requests for advocacy in addressing and resolving 
complaints; 
   
  (2) thoroughly investigating each such complaint received, when applicable; 
   
  (3) representing the individuals served and advocating for the resolution of 
their grievances; 
   
  (4) reporting the results of investigations and advocacy to the complainants, 
consistent with the protection of the service recipients' right to 
confidentiality; and 
   
  (5)  reviewing all policies, procedures, practices, behavior therapy programs, 
and rules which affect the rights of individuals receiving services to ensure 
that the rights of individuals are not unduly restricted. 
     
  (d) The toll free number of the Office of Consumer Services and Rights 
Protection (CSRP) in Central Office (1-800-252-8154) shall be posted in all 
program locations that are accessible to individuals and their legally 
authorized representatives along with CSRP's toll free TDD number (1-800-538-
4870). 
 
     
  sec.404.209. Staff Training in Rights of Individuals Receiving Mental 
Retardation Services. 
 
  (a) All new employees shall receive instruction on the content of this 
subchapter during their orientation training and prior to beginning work. The 
instruction shall emphasize the importance of the rights of individuals 
receiving services, and their legally authorized representatives. 
   
  (b) All supervisory personnel shall ensure that direct contact employees 
remain informed through annual refresher training about current rules governing 
rights of individuals receiving mental retardation services. 
 
     
  sec.404.210. References.  Reference is made to the following Texas laws, 
federal laws, departmental rules, and other standards: 
 
  (1)  Texas Health and Safety Code, sec.534.001; 
   
  (2) Texas Health and Safety Code, Title 7, Subtitle D, Persons with Mental 
Retardation Act; 
   
  (3) Texas Civil Statutes, Article 5159d; 
   
  (4) 41 Code of Federal Regulations, sec.sec.60-741.1; 
   
  (5) 45 Code of Federal Regulations, sec.sec.84.1, 84.4, 84.52, and 85.1; 
   
  (6) 45 Code of Federal Regulations, Part 100b, 121a, 121m; 
   
  (7) Fair Labor Standards Act; 
   
  (8) Individuals with Disabilities Education Act (IDEA), formerly known as the 
Education of Handicapped Children Act; 
   
  (9) Texas Administrative Code, Title 40, Chapter 710, Subchapter A, (relating 
to Abuse and Neglect of Persons Served by TXMHMR Facilities); 
   
  (10) Texas Administrative Code, Title 40, Chapter 710, Subchapter B, (relating 
to Client Abuse and Neglect in Community Mental Health and Mental Retardation 
Centers); 
   
  (11) Chapter 403, Subchapter N of this title (relating to Administrative 
Hearings Arising Under the Persons With Mental Retardation Act); 
   
  (12) Chapter 405, Subchapter D of this title (relating to Determination of 
Mental Retardation and Appropriateness for Admission to Mental Retardation 
Services); 
   
  (13) Chapter 405, Subchapter FF of this title (relating to Consent to 
Treatment with Psychoactive Medication); 
   
  (14) Chapter 402, Subchapter F of this title (relating to Continuity of 
Services-MR Campus-Based Services); 
   
  (15) Chapter 403, Subchapter K of this title (relating to Client-Identifying 
Information); 
   
  (16)  ICF/MR Intermediate Care Facilities for the Mentally Retarded Program 
standards; 
   
  (17) Consumer Principles for Evidentiary Certification in the Home and 
Community-Based Services Program; 
   
  (18) Consumer Principles for Evidentiary Certification in the Home and 
Community-Based Services-OBRA Program; 
   
  (19) Constitution of the State of Texas; and 
   
  (20) Constitution of the United States of America. 
 
     
  sec.404.211. Distribution. 
 
  (a) This subchapter shall be distributed to: 
 
  (1) members of the Texas Mental Health and Mental Retardation Board; 
   
  (2) management and program staff in Central Office; 
   
  (3) superintendents and directors of department facilities providing mental 
retardation services; 
   
  (4) executive directors and chairpersons of the boards of all community 
centers providing mental retardation services; 
   
  (5) executive directors of state operated community MHMR centers providing 
mental retardation services; and 
   
  (6) interested advocates and advocacy organizations. 
     
  (b) The superintendent or director of each facility and the executive director 
of each local authority shall provide a copy of this subchapter to: 
 
  (1) the facility or local authority rights protection officer; 
   
  (2) the chair of the public responsibility committee; 
   
  (3) all appropriate staff; 
   
  (4) each subcontractor which provides direct services; and 
   
  (5) any other person who requests a copy. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 29, 1996. 
 TRD-9605849 
  Ann K. Utley 
 Chair, Texas Mental Health and Mental Retardation Board 
 Texas Department of Mental Health and Mental Retardation 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 206-5232 
         
                 Chapter 405. Client (Patient) Care 
  
  Subchapter Y. Rights of Mentally Retarded Persons 
 
  25 TAC sec.sec.405.621-405.629 
 
  The Texas Department of Mental Health and Mental Retardation (TDMHMR) proposes 
the repeal of sec.sec.405.621-405.629, concerning rights of clients-mental 
retardation services. 
 The repeal of the subchapter would facilitate the reorganization of chapters 
and subchapters within the department's portion of the Texas Administrative 
Code. A new rule (Chapter 404, Subchapter F) governing similar matters is 
proposed contemporaneously for public comment in this issue of the Texas 
Register . 
 Donald C. Green, chief financial officer, has determined that for the first 
five-year period the sections as proposed are in effect there will be no 
significant fiscal impact on state or local government as a result of enforcing 
the repeals. 
 Pam Carley, director, Consumer Services and Rights Protection, has determined 
that for each year of the first five years the repeals are in effect the public 
benefit anticipated as a result of enforcing the provisions is the availability 
of a comprehensive and accurate delineation of the rights of individuals 
receiving mental retardation services through the department and of their 
legally authorized representatives. There will be no significant fiscal impact 
on small businesses. There is no anticipated economic cost to persons who are 
required to comply with the sections as proposed. 
 Written comments on the proposed repeals may be sent to Linda Logan, director, 
Policy Development, Texas Department of Mental Health and Mental Retardation, 
P.O. Box 12668, Austin, Texas 78711-2668, or faxed to (512) 206-4750 within 30 
days of publication. 
 These sections are proposed under the Texas Health and Safety Code, sec.532. 
015, which provides the Texas Mental Health and Mental Retardation Board with 
broad rulemaking authority. 
 These sections would affect the Texas Health and Safety Code, sec.592.002 and 
sec.592.040. 
 
 
  sec.405.621. Purpose. 
 
   
  sec.405.622. Application. 
 
   
  sec.405.623. Definitions. 
 
   
  sec.405.624. Rights of All Clients Receiving Mental Retardation Services. 
 
   
  sec.405.625. Rights of Clients Receiving Residential Mental Retardation 
Services. 
 
   
  sec.405.626. Rights Handbook for Clients Receiving Mental Retardation 
Services. 
 
   
  sec.405.627. Communication of Rights to Clients Receiving Mental Retardation 
Services. 
 
   
  sec.405.628. References. 
 
   
  sec.405.629. Distribution. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 15, 1996. 
 TRD-9605879 
  Ann K. Utley 
 Chair, Texas Mental Health and Mental Retardation Board 
 Texas Department of Mental Health and Mental Retardation 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 206-5232 
         
                 
  TITLE 30. ENVIRONMENTAL QUALITY 
 Part I. Texas Natural Resource Conservation Commission 
  Chapter 114. Control of Air Pollution From Motor Vehicles 
  
  The commission proposes the repeal of sec.114.11 and new sec.sec.114.30-114. 
40, relating to clean-fuel vehicle use by mass transit authorities, local 
governments, and private persons; and a corresponding revision to the State 
Implementation Plan (SIP) relating to clean-fuel vehicle use by local 
governments and private persons. 
 The purpose of the proposed new sections and corresponding SIP revision is to 
implement Senate Bill 200 (SB 200), Acts of the 74th Texas Legislature, 1995, 
pertaining to the alternative fuels program; House Bill 734 (HB 734), Acts of 
the 72nd Texas Legislature, 1991, pertaining to the operations and functions of 
certain mass transit authorities; the 1990 Federal Clean Air Act as amended, 
Acts of the 101st U.S. Congress, pertaining to provisions for attainment and 
maintenance of health protective national ambient air quality standards; and for 
other purposes. 
 The commission has proposed to implement the provisions of SB 200 in phases. 
Phase I contains requirements for the serious and above ozone and carbon 
monoxide non-attainment areas for local government and private fleets, and 
requirements for all non-attainment areas for mass transit authorities. Phase I 
includes local government and private fleets in the Houston/Galveston and El 
Paso areas, and mass transit authorities in the Beaumont/Port Arthur, 
Dallas/Fort Worth, El Paso and Houston/Galveston non-attainment areas. 
 Proposed new sec.114.30 provides definitions that are unique to the clean-fuel 
vehicle requirements. 
 Proposed new sec.114.31 contains the clean-fuel vehicle requirements for mass 
transit authorities. The requirement is for the affected mass transit 
authorities to have 50% of their total fleet vehicles certified as clean-fuel 
vehicles by September 1, 1996. 
 Proposed new sec.114.32 contains the clean-fuel vehicle requirements for local 
governments and private persons. The requirements are for these fleets to have: 
10% of their total fleet as clean-fuel vehicles by September 1, 1998, or to have 
30% of their new purchases as clean-fuel vehicles after September 1, 1998; 20% 
of their total fleet as clean-fuel vehicles by September 1, 2000, and to have 
50% of their new purchases as clean-fuel vehicles after September 1, 2000; and 
45% of their total fleet as clean-fuel vehicles by September 1, 2002, and to 
have 90% of their new purchases as clean-fuel vehicles after September 1, 2002. 
 Proposed new sec.114.33 implements a "grandfather clause" for affected entities 
as provided by SB 200. Entities which have attempted to comply with earlier fuel 
usage mandates through the purchase of vehicles operating on certain defined 
fuels (electricity, ethanol, liquefied petroleum gas, methanol, and natural 
gas), may use these vehicles, up to a specific maximum, for compliance with this 
program. 
 Proposed new sec.114.34 provides for exceptions from the clean-fuel vehicle 
requirements. Affected entities may be granted an exception from the clean-fuel 
vehicle requirements, on a case by case basis, if: 1) a firm is engaged in a 
fixed price contract with a public works agency where compliance with the clean-
fuel vehicle requirements would cause economic harm to the firm; 2) adequate 
fueling required for the operation of certified clean-fuel vehicles is 
unavailable; 3) financing for the increased cost of operation of clean-fuel 
vehicles in unavailable from fuel suppliers; and 4) the costs, over the lifetime 
of the clean-fuel vehicle's operation, is more than the costs of the operation 
of conventional vehicles. 
 Proposed new sec.114.35 implements HB 734, which requires the commission to 
adopt rules for certification of exceptions for certain transit authorities. The 
commission has determined that this section only applies to Capital Metro in 
Austin. 
 Proposed new sec.114.36 provides the general reporting requirements for 
affected entities. 
 Proposed new sec.114.37 requires affected entities to maintain copies of their 
annual reports for 3 years on site and make such copies available to the 
executive director or local air pollution control agencies having jurisdiction 
in the area upon request. 
 Proposed new sec.114.38 establishes Program Compliance Credits (PCCs) as 
required by SB 200. PCCs are not based on actual emission reductions but have 
values as determined by the Legislature. The credits can only be generated by 
entities that are subject to the requirements and have exceeded the program's 
purchase and/or percent of fleet requirements. PCCs may be used for an affected 
entity's own requirements, or for trades to other affected entities within the 
same non-attainment area. 
 Proposed new sec.114.39 establishes the Mobile Emission Reduction Credit (MERC) 
trading program. MERCs are based on quantified emission reductions from 
certified clean-fuel fleet vehicles. MERCs may be generated by affected entities 
or by individuals utilizing clean-fuel fleet vehicles but who are not covered by 
the requirements. MERCs are generated by affected entities by exceeding the 
purchase and/or percent of total fleet requirements, and may be used for a 
fleet's own compliance, trades to other fleets, trades to stationary sources, or 
for compliance with any other mobile emission program that has marketable 
credits. MERCs are restricted to trading only within the non-attainment area 
where they were generated. 
 Proposed new sec.114.40 establishes the Texas Mobile Emission Reduction Credit 
Trading Fund. The section allows affected entities to enter into binding 
contracts with the commission to generate MERCs provided that the U.S. 
Environmental Protection Agency is named as a third party beneficiary. These 
contracts are enforced through the courts of the State of Texas by orders of 
specific performance. 
 Stephen Minick, Strategic Planning and Appropriations Division, has determined 
that for the first five years these sections as proposed are in effect there 
will be fiscal implications as a result of enforcement and administration of the 
sections. There are no significant implications anticipated for state 
government. Modifications to the clean-fuel vehicle program may have some 
effects on workload and staff requirements within the commission; however, these 
effects are not anticipated to vary significantly from any requirements imposed 
by the authorizing legislation (SB 200) and will not require additional budget 
authority or resources. There are no significant effects on local governments 
except local governments operating vehicle fleets within air quality non-
attainment areas subject to the provisions of these sections. Affected local 
governments will realize a reduction in the costs of compliance with federal 
requirements and existing clean fleet regulations. 
 Mr. Minick also has determined that for each year of the first five years these 
sections as proposed are in effect the public benefit anticipated as a result of 
enforcement of and compliance with the sections will be satisfaction of the 
requirements of the Federal Clean Air Act Amendments of 1990, improved 
consistency of federal and state air quality requirements, the reduction of 
emissions from mobile sources, and more cost-effective control of mobile source 
emissions. Relative to existing requirements, the sections as proposed will 
result in some cost savings to affected persons, including small businesses, 
required to comply with the sections. These costs savings are related to the 
expansion of the definition of alternative fuels, additional exemptions for 
certain classes of vehicles, and the expanded options for waivers from 
compliance. It has been estimated that the number of clean-fuel vehicles 
projected to have been acquired by certain affected fleet owners or operators to 
comply with the proposed rule in the non-attainment areas of Houston/Galveston 
and El Paso shows approximately 11,692 clean-fuel vehicles in the year 2000; 
48,991 by 2004; and 59,965 by 2008. The actual costs of acquiring clean-fuel 
vehicles to meet the fleet implementation schedules will vary depending on the 
price of new original equipment manufactured clean-fuel vehicles and the costs 
of conversion systems. No estimate of the total cost savings can be determined 
at this time. There are no economic costs to any person, including any small 
business, required to comply with the section as proposed. 
 The commission has prepared a Takings Impact Assessment for these rules 
pursuant to Texas Government Code, sec.2007.043. Promulgation and enforcement of 
these rules will not affect private real property. 
 Public hearings on this proposal will be held in Beaumont on June 3, 1996 at 
1:00 p.m. at the John Gray Institute, 855 Florida Avenue, Beaumont; in Houston 
on June 3, 1996 at 7:00 p.m. at the City of Houston Pollution Control Building 
Auditorium, 7411 Park Place Boulevard, Houston; in Irving on June 4, 1996 at 
11:00 a.m. at the City of Irving Central Library Auditorium, 801 West Irving 
Boulevard, Irving; in El Paso on June 4, 1996 at 7:00 p.m. at the City of El 
Paso Council Chambers, 2 Civic Center Plaza, 2nd Floor, El Paso; and in Austin 
on June 5, 1996 at 2:00 p.m. at the Texas Natural Resource Conservation 
Commission Complex, Building F, Room 2210, Austin. Individuals may present oral 
statements when called upon in order of registration. Open discussion within the 
audience will not occur during the hearings; however an agency staff member will 
be available to discuss the proposal 30 minutes prior to each hearing and will 
answer questions before and after the hearings. 
 Written comments may be mailed to Heather Evans, Office of Policy and 
Regulatory Development, MC 205, P.O. Box 13087, Austin, Texas 78711-3087 or 
faxed to (512) 239-4808. All comments should reference Rule Log Number 95153-
114-AI. Comments must be received by 5:00 p.m., June 5, 1996. For further 
information or questions concerning this proposal, or to get a copy of guidance 
documents for exceptions or credit applications, contact Ms. Hazel Barbour, 
Manager, Clean Fuels and Commute Options Section, (512) 239-1440. 
 Persons with disabilities who have special communication or other accommodation 
needs who are planning to attend the hearing should contact the agency at (512) 
239-4900. Requests should be made as far in advance as possible. 
   
  30 TAC sec.114.11 
 
  (Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Natural 
Resource Conservation Commission or in the Texas Register office, Room 245, 
James Earl Rudder Building, 1019 Brazos Street, Austin.) 
   
  Statutory authority for the clean-fuel vehicle requirements is found in the 
Texas Health and Safety Code, sec.sec.382.131-382.143. In addition, under the 
Texas Health and Safety Code, sec.382.002 and sec.382.011, the commission is 
given "the powers necessary or convenient to carry out its responsibilities" to 
establish and maintain air quality standards. The commission also has broad 
authority to adopt and enforce rules pursuant to the Texas Health and Safety 
Code, sec.382.017. The commission is also given authority under sec.451.301 of 
the Texas Transportation Code. 
 The proposed repeal implements the Health and Safety Code, sec.382.017. 
 
 
  sec.114.11. Emission and Alternative Fuel Requirements for Motor Vehicle 
Fleets 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be a valid exercise of the agency's authority. 
 Issued in Austin, Texas, on April 24, 1996. 
 TRD-9605693 
  Kevin McCalla 
 Director, Legal Services Division 
 Texas Natural Resource Conservation Commission 
    Proposed date of adoption: July 24, 1996 
 For further information, please call: (512) 239-1970 
         
         
  30 TAC sec.sec.114.30-114.40 
 
  Statutory authority for the clean-fuel vehicle requirements is found in the 
Texas Health and Safety Code, sec.sec.382.131-382.143. In addition, under the 
Texas Health and Safety Code, sec.382.002 and sec.382.011, the commission is 
given "the powers necessary or convenient to carry out its responsibilities" to 
establish and maintain air quality standards. The commission also has broad 
authority to adopt and enforce rules pursuant to the Texas Health and Safety 
Code, sec.382.017. The commission is also given authority under sec.451.301 of 
the Texas Transportation Code. 
 The proposed new sections implement the Health and Safety Code, sec.382.017. 
 
 
  sec.114.30. Definitions.  Unless specifically defined, the terms used in these 
rules have the meanings commonly ascribed to them in the field of air pollution 
control. In addition to these terms, the following words and terms, when used in 
sec.sec.114.30-114.40 of this title (relating to Control of Air Pollution From 
Motor Vehicles), shall have the following meanings: 
   
   Alternative fuel -Any fuel or power source that, when used in a clean-fuel 
vehicle, allows the vehicle to comply with the standards and requirements of the 
Federal Clean Air Act, Part C, Subchapter II, as amended (United States Code 
(USC), Title 42, sec.sec.7581 et seq) and emission limits at least as stringent 
as the applicable low-emission vehicle standards for the clean-fuel fleet 
program under Code of Federal Regulations (CFR), Title 40, Part 88. 
   
   Beaumont/Port Arthur non-attainment area-Hardin, Jefferson, and Orange 
counties. 
   
   Capable of being centrally fueled-A fleet or that part of a fleet consisting 
of vehicles that could be refueled 100% of the time at a location that is owned, 
operated, or controlled by the fleet operator or that is under contract with the 
fleet operator. The fact that one or more vehicles in a fleet are not centrally 
fueled does not exempt an entire fleet from the program. 
   
   Capable of operating -Having the necessary permanently installed equipment 
that enables a vehicle to use a specified fuel. 
   
   Centrally fueled -A fleet or that part of a fleet consisting of vehicles that 
are refueled 100% of the time at a location that is owned, operated, or 
controlled by the fleet operator or that is under contract with the fleet 
operator. The fact that one or more vehicles in a fleet are not centrally fueled 
does not exempt an entire fleet from the program. The term does not include 
retail credit card purchases or commercial fleet card purchases. 
   
   Certified-The process established by the United States Environmental 
Protection Agency to ensure compliance, throughout the entire useful life of a 
vehicle, with the required standards as defined in CFR, Title 40. 
   
   Clean-fuel vehicle -A vehicle in a class or category of vehicles that has 
been certified to meet for any model year: 
 
  (A) the clean-fuel vehicle standards applicable under the Federal Clean Air 
Act as amended Part C, Subchapter II, (U.S.C. 42 sec.sec.7581 et seq); 
   
  (B) emission limits at least as stringent as the applicable low-emission 
vehicle standards for the clean-fuel fleet program under CFR, Title 40, Parts 
88.104-94, 88.105-94, and as published in the Federal Register of September 30, 
1994; and 
   
  (C) vehicles certified to the inherently low-emission vehicle standards under 
CFR, Title 40, Part 88.311-93 as published in the Federal Register, March 1, 
1993, will also be considered clean-fuel vehicles. 
     
   Control- 
 
  (A) When it is used to join all entities under common management, means any 
one or a combination of the following: 
 
  (i) a third person or firm has equity ownership of 51% or more in each of two 
or more firms; 
   
  (ii) two or more firms have common corporate officers, in whole or in 
substantial part, who are responsible for the day-to-day operation of the 
companies; 
   
  (iii) one firm leases, operates, supervises, or in 51% or greater part owns 
equipment and/or facilities used by another person or firm, or has equity 
ownership of 51% or more of another firm. 
     
  (B) When it is used to refer to the management of vehicles, means a person has 
the authority to decide who can operate a particular vehicle, and the purposes 
for which the vehicle can be operated. 
   
  (C) When it is used to refer to the management of people, means a person has 
the authority to direct the activities of another person or employee in a 
precise situation, such as the workplace. 
     
   Conventional vehicle -A vehicle which meets the federal emission standards 
but is not a clean-fuel vehicle. 
   
   Dallas/Fort Worth non-attainment area-Collin, Dallas, Denton, and Tarrant 
counties. 
   
   Dual-fuel vehicle -Any motor vehicle or motor vehicle engine engineered and 
designed to be operated on two different fuels, but not a mixture of the two. 
   
   El Paso non-attainment area-El Paso County. 
   
   Emergency vehicle -A vehicle defined as an authorized emergency vehicle in 
the Texas Transportation Code, sec.541.201(1). 
   
   Emissions-The emissions of oxides of nitrogen, volatile organic compounds, 
carbon monoxide, particulates, or any combination of these substances. 
   
   Fleet-All vehicles that are owned, operated, or controlled by an affected 
entity and are: 
 
  (A) registered in and primarily operated within the same non-attainment area; 
or 
   
  (B) registered outside a non-attainment area but operated primarily inside a 
non-attainment area. 
     
   Fleet vehicle-A vehicle required to be registered under the Texas 
Transportation Code, sec.502.002, and that is centrally fueled, capable of being 
centrally fueled, or fueled at facilities serving both business customers and 
the general public. The term does not include: 
 
  (A) a fleet vehicle that, when not in use, is normally parked at the residence 
of the individual who usually operates it and that is available to such 
individual for personal use; 
   
  (B) a fleet vehicle that, when not in use, is normally parked at the residence 
of the individual who usually operates it and who does not report to a central 
location; or 
   
  (C) a fleet vehicle that has a gross vehicle weight rating (GVWR) greater than 
26,000 pounds except vehicles owned or operated by mass transit authorities. 
     
   Gross vehicle weight rating-The value specified by the manufacturer as the 
maximum design loaded weight for a single vehicle, as defined in CFR, Title 40, 
Part 86.082-2. This is the weight as expressed on the vehicle's title, and 
includes the weight the vehicle can carry or draw. 
   
   Heavy-duty vehicle -Any passenger vehicle or truck capable of transporting 
people, equipment, or cargo, that has a GVWR greater than 8,500 lbs., and is 
required to be registered under the Texas Transportation Code, sec.502.002. For 
purposes of the Mobile Emission Reduction Credit (MERC) trading program the 
heavy-duty class is divided into the following subclasses: 
 
  (A) Light heavy-duty vehicle-Any passenger vehicle or truck capable of 
transporting people, equipment, or cargo that has a GVWR greater than 8,500 lbs. 
but less than or equal to 10,000 lbs. 
   
  (B) Medium heavy-duty vehicle-Any passenger vehicle or truck capable of 
transporting people, equipment, or cargo that has a GVWR greater than 10, 000 
lbs. but less than or equal to 19,500 lbs. 
   
  (C) Heavy heavy-duty vehicle-Any passenger vehicle or truck capable of 
transporting people, equipment, or cargo that has a GVWR greater than 19, 500 
lbs. 
     
   Houston/Galveston non-attainment area-Brazoria, Chambers, Fort Bend, 
Galveston, Harris, Liberty, Montgomery, and Waller counties. 
   
   Inherently low emission vehicle-A vehicle as defined by CFR, Title 40, Part 
88. 
   
   Law enforcement vehicle-Any vehicle controlled by a local government and 
primarily operated by a civilian or military police officer or sheriff, or by 
state highway patrols, or other similar law enforcement agencies, and which is 
used for the purpose of law enforcement activities including, but not limited 
to, chase, apprehension, surveillance, or patrol of people engaged in or 
potentially engaged in unlawful activities. 
   
   Light-duty vehicle -Any passenger vehicle or truck capable of transporting 
people, equipment, or cargo, that has a GVWR less than or equal to 8,500 lbs, 
and required to be registered under the Texas Transportation Code,  s502.002. 
For purposes of the MERC trading program the light-duty class is divided into 
the following subclasses: 
 
  (A) Light-duty vehicle-Any passenger vehicle capable of seating 12 or fewer 
passengers that has a GVWR less than or equal to 6,000 lbs. 
   
  (B) Light-duty truck 1-Any passenger truck capable of transporting people, 
equipment or cargo, that has a GVWR less than or equal to 6,000 lbs. 
   
  (C) Light-duty truck 2-Any passenger truck capable of transporting people, 
equipment or cargo, that has a GVWR greater than 6,000 lbs. but less than 8,500 
lbs. 
     
   Local government -A city, county, municipality, or political subdivision of a 
state. This term does not include school districts. 
   
   Local government fleet-All fleets owned, operated, or controlled by a local 
government. 
   
   Low emission vehicle-A vehicle as defined by CFR, Title 40, Part 88. 
   
   Mass transit authority-A transportation or transit authority or department 
established under Chapter 141, Acts of the 63rd Legislature, Regular Session, 
1973 as defined in the Texas Transportation Code, Chapters 451 (Metropolitan 
Rapid Transit Authorities), 452 (Regional Transportation Authorities), and 453 
(Municipal Transportation Authorities), that operates a mass transit system 
under any of those laws. 
   
   Mass transit fleet-All vehicles owned, operated, or controlled by a mass 
transit authority. 
   
   Mobile emission reduction credit-The credit obtained from an enforceable, 
permanent, quantifiable, and surplus (to other federal and state regulations) 
emission reduction generated by a mobile source as set forth in sec.114.39 of 
this title (relating to Mobile Emission Reduction Credit Program) and which has 
been banked in accordance with sec.101.29 of this title (relating to Emissions 
Banking). 
   
   Non-road vehicle -A vehicle which is not registered under the Texas 
Transportation Code, sec.502.002. 
   
   Operate-Use of a vehicle on any public road. 
   
   Own-Having legal title to the vehicle. 
   
   Private person -Any individual, partnership, firm, company, business trust, 
corporation, organization, or association which owns, operates, or controls a 
fleet. 
   
   Primarily operated -Use of a motor vehicle more than 50% of its total use 
measured in vehicle miles traveled in any affected area. 
   
   Program compliance credits-Credits that may be granted to vehicle 
owner/operators who exceed the clean-fuel vehicle provisions and requirements of 
this chapter. 
   
   Public works agency-A governmental body established by the legislative 
branch, including municipalities and counties acting by ordinance, charged with 
administrating the construction and maintenance of improvements constructed with 
public funds for public use, protection, or enjoyment, and those who oversee 
provision of public services. 
   
   Tier I federal emission standards-The standards are defined in the Federal 
Clean Air Act as amended in sec.202, USC Title 42 sec.7521, and in CFR Title 40 
Part 86. The phase-in of these standards began in model year 1994. 
   
   Ultra low emission vehicle-A vehicle as defined by CFR Title 40 Part 88. 
   
   Vehicle-A self propelled device designed to operate with four or more wheels 
in contact with the ground and in or by which a person or property is or may be 
transported on a public highway. 
   
   Zero emission vehicle-A vehicle as defined by CFR Title 40 Part 88. 
 
   
  sec.114.31. Requirements for Mass Transit Authorities. 
 
  (a) Mass Transit authorities as defined by sec.114.30 of this title (relating 
to Definitions) that own, operate, or control vehicles, are subject to the 
clean-fuel vehicle provisions and requirements of this chapter when operated in 
the following non-attainment areas: Beaumont/Port Arthur, Dallas/Fort Worth, El 
Paso, and Houston/Galveston. 
   
  (b) Mass transit authorities shall ensure that at least 50% of their fleet 
vehicles are clean-fuel vehicles by September 1, 1996. 
   
  (c) Mobile Emission Reduction Credit (MERCs) or Program Compliance Credits 
(PCCs) may be used to meet the percentage requirements of subsection (b) of this 
section. 
   
  (d) The acquisition of qualifying clean-fuel vehicles may qualify for both 
PCCs and MERCs, however only one type of credit may be used per vehicle. 
   
  (e) The percentage requirements of subsection (b) of this section may be met 
by the dual-fuel conversion or capability of conventional gasoline-powered or 
diesel-powered vehicles to be certified as clean-fuel vehicles pursuant to the 
dual-fuel standards found in Code of Federal Regulations, Title 40, Part 88. 
   
  (f) Vehicles converted, purchased, leased, or otherwise acquired prior to 
September 1, 1998, in accordance with sec.114.33 of this title (relating to Use 
of Certain Vehicles for Compliance) may be counted towards a mass transit 
authority's compliance with the percentage requirements of subsection (b) of 
this section. 
   
  (g) Exceptions from the requirements of subsection (b) may be granted pursuant 
to sec.114.34 of this title (relating to Exceptions). 
   
  (h) By September 30, of each year starting in 1996, mass transit authorities 
shall submit annual reports as required under sec.114.36 of this title (relating 
to Reporting). 
   
  (i) Mass transit authorities shall maintain records pursuant to sec.114. 37 of 
this title (relating to Record Keeping). 
   
  (j) Mass transit authorities are eligible for MERCs pursuant to sec.114. 39 of 
this title (relating to Mobile Emission Reduction Credit Program) for the 
operation of light rail cars which have been certified by the mass transit 
authority to have no direct emissions. 
 
     
  sec.114.32. Requirements for Local Governments and Private Persons. 
 
  (a) Local governments that own, operate, or control a fleet of more than 15 
vehicles, excluding law enforcement and emergency vehicles, and private persons 
that own, operate, or control a fleet of more than 25 fleet vehicles, excluding 
emergency vehicles, are subject to the clean-fuel vehicle provisions and 
requirements of this chapter when primarily operated in the El Paso and 
Houston/Galveston non-attainment areas. 
   
  (b) Beginning September 1, 1998, local governments and private persons shall 
ensure that their fleet vehicles are clean-fuel vehicles in accordance with the 
following schedule: 
 
  (1) 30% of fleet vehicles purchased after September 1, 1998; or at least 10% 
of the fleet vehicles in the total fleet as of September 1, 1998; 
   
  (2) 50% of fleet vehicles purchased after September 1, 2000; and at least 20% 
of the fleet vehicles in the total fleet as of September 1, 2000; and 
   
  (3) 90% of fleet vehicles purchased after September 1, 2002; and at least 45% 
of the fleet vehicles in the total fleet as of September 1, 2002. 
     
  (c) Mobile Emission Reduction Credit (MERCs) or Program Compliance Credits 
(PCCs) may be used to meet the percentage requirements of subsection (b) of this 
section. 
   
  (d) The acquisition of qualifying clean-fuel vehicles may qualify for both 
PCCs and MERCs, however only one type of credit may be used per vehicle. 
   
  (e) A local government or private person is not required to purchase clean-
fuel vehicles if a proportion of 90% or more clean-fuel vehicles is maintained 
in their fleet. 
   
  (f) The percentage requirements of subsection (b) of this section may be met 
by dual-fuel conversion or capability of conventional gasoline-powered or 
diesel-powered vehicles to be certified as clean-fuel vehicles pursuant to the 
dual fuel standards found in Code of Federal Regulations, Title 40, Part 88. 
   
  (g) Exceptions from the requirements of subsection (b) of this section may be 
granted pursuant to sec.114.34 of this title (relating to Exceptions). 
   
  (h) By September 1, 1997, or within 90 days of meeting the minimum fleet size 
where applicable, affected entities shall register with the executive director 
for identification and compliance tracking. Registration must include the 
submission of the following information: 
 
  (1) the affected entity's name, mailing address, telephone and fax numbers; 
   
  (2) the name, title, mailing address and telephone number of the specific 
person responsible for the affected fleet; and 
   
  (3) the total number of vehicles owned, operated or controlled, including non-
covered and exempted vehicles. 
     
  (i) Upon registration, the executive director will assign each fleet a unique 
identification number for data tracking purposes. 
   
  (j) Affected local government and private fleets shall maintain records 
pursuant to sec.114.37 of this title (relating to Record Keeping). 
   
  (k) By September 1 of each year, starting in 1998, affected local government 
and private fleets must submit reports to the executive director, as required 
under sec.114.36 of this title (relating to Reporting). 
 
     
  sec.114.33. Use of Certain Vehicles for Compliance. <ol> Vehicles converted, 
purchased, leased, or otherwise acquired prior to September 1, 1998, may be 
counted for an affected entity's clean-fuel vehicle applicable fleet percentage 
requirements, if the vehicles: 
 
  (1) do not exceed 30% of the entity's fleet on September 1, 1998; 
   
  (2) are capable of operating on one of the following fuels; 
 
  (A) electricity; 
   
  (B) ethanol, or ethanol/gasoline blends of 85% or greater ethanol; 
   
  (C) liquefied petroleum gas, commonly referred to as propane; 
   
  (D) methanol or methanol/gasoline blends of 85% or greater methanol; or 
   
  (E) natural gas; and 
     
  (3) are light-duty vehicles and meet, at a minimum, the federal Tier I 
emission standards pursuant to the Federal Clean Air Act as amended, sec.202, U. 
S.C. 42 sec.7521, and Code of Federal Regulations, Title 40, Part 86; or 
   
  (4) are heavy-duty vehicles and meet, at a minimum, the federal emission 
standards in place at the time of their manufacture. 
 
     
  sec.114.34. Exceptions. 
 
  (a) Exceptions from the applicable clean-fuel vehicle requirements of this 
chapter may be granted for a period of up to 2 years. Exceptions are based on 
the determination by the executive director that one of the following conditions 
exist: 
 
  (1) A firm engaged in fixed price contracts with public works agencies can 
demonstrate that compliance with the requirements of clean-fuel vehicle 
provisions and requirements of this chapter would result in substantial economic 
harm to the firm under a contract entered into before September 1, 1997. The 
following documentation must be submitted to the executive director when 
applying for this exception: 
 
  (A) copies of the relevant contracts; and 
   
  (B) a demonstration of how and by what means the firm would be harmed by 
complying with the requirements of the clean-fuel vehicle provisions and 
requirements of this chapter. 
     
  (2) The affected entity's vehicles will be operating primarily in an area that 
does not have or cannot reasonably be expected to establish adequate refueling 
for the operation of clean-fuel vehicles as required by the clean-fuel vehicle 
provisions and requirements of this chapter. The following information must be 
submitted to the executive director when applying for this exception: 
 
  (A) the name of the county where the affected entity's fleet primarily 
operates; 
   
  (B) the physical address of the nearest refueling station that provides fuels 
necessary for clean-fuel operation; and 
   
  (C) a demonstration of the normal operating range of the affected entity's 
fleet sufficient for the executive director to determine that the fleet will be 
operating primarily in an area that does not have or cannot be reasonably 
expected to establish adequate refueling for the fleet's normal operational 
needs. 
     
  (3) The affected entity is unable to secure financing provided by or arranged 
through the proposed supplier or suppliers of the fuel necessary for the 
operation of the clean-fuel vehicles required by the clean-fuel vehicle 
provisions and requirements of this chapter sufficient to cover the additional 
costs of such fueling. The following information must be submitted to the 
executive director when applying for this exception: 
 
  (A) a description of the financing required by the affected entity; 
   
  (B) a description of the financing offered by the proposed supplier(s) of the 
fuels necessary for the operation of clean-fuel vehicles; and 
   
  (C) a demonstration of why the affected entity is unable to secure such 
financing as provided by the fuel supplier sufficient to cover the additional 
costs of fueling clean-fuel vehicles. 
     
  (4) The projected net costs of the fueling, conversion or replacement, and 
operation of clean-fuel vehicles reasonably is expected to exceed comparable 
costs of the fueling, replacement, and operation of conventional vehicles when 
measured over the expected useful life of such vehicles and after including in 
such cost calculations any available state or federal funding or incentives for 
the use of fuels required to operate clean-fuel vehicles. The following 
information must be submitted to the executive director when applying for this 
exception: 
 
  (A) types of vehicles needed; and 
   
  (B) a demonstration of how the projected net costs of using clean-fuel 
vehicles exceeds the comparable costs of using conventional vehicles over the 
useful life of such vehicles, after the identification of any available state or 
federal funding or incentives for the use of fuels required to fuel clean-fuel 
vehicles. 
       
  (b) Exception applications will be reviewed by the executive director in 
accordance with the following process and are subject to the following 
provisions: 
 
  (1) Exception applications will be reviewed on a case by case basis; 
   
  (2) All currently available vehicle/fuel configurations must be evaluated by 
the affected entity before an exception application will be reviewed; 
   
  (3) The executive director may request additional information in order to 
evaluate an exception application; 
   
  (4) Applications will be accepted by the executive director at any point 
within the twelve months preceding a compliance deadline, provided a current 
fleet report containing the information in sec.114.36 of this title (relating to 
Reporting) is also provided; 
   
  (5) The affected entity receiving a notice of exception shall maintain a copy 
of the notice on-site at the reported fleet address for the duration of the 
exception period and shall make such copies available to the executive director 
or local air pollution control agencies upon request; and 
   
  (6) Affected entities who have been granted an exception are not eligible for 
Program Compliance Credits or Mobile Emission Reduction Credits, or to enter 
into a contract according to  s114.40 of this title (relating to the Texas 
Mobile Emission Reduction Credit Fund), for the duration of the exception 
period. 
 
       
  sec.114.35. Exceptions for Certain Mass Transit Authorities. 
 
  (a) This section applies only to a mass transit authority confirmed at a tax 
election before July 1, 1985, and in which the principal city has a population 
of less than 750,000, according to the most recent federal census. 
   
  (b) The executive director may reduce any percentage specified by, or waive 
the requirements of, Texas Transportation Code, sec.451.301, for an authority on 
receipt of certification supported by evidence acceptable to the executive 
director that: 
 
  (1) the authority's vehicles will be operating primarily in an area in which 
neither the authority nor a supplier has or can reasonably be expected to 
establish a central refueling station necessary for the operation of clean-fuel 
vehicles; or 
   
  (2) the authority is unable to acquire or be provided equipment or refueling 
facilities necessary to operate clean-fuel vehicles at a projected cost that is 
reasonably expected to result in no greater net costs than the continued use of 
equipment or refueling facilities used to operate conventional vehicles, 
measured over the expected useful life of the equipment or facilities supplied. 
     
  (c) Certification by the executive director that an authority covered by Texas 
Transportation Code, sec.451.301, is unable to comply is accomplished through 
development of a proposal to be submitted to the executive director. The 
proposal must: 
 
  (1) contain an alternative implementation schedule for meeting the percentage 
requirements of Texas Transportation Code, sec.451.301; and 
   
  (2) have been the subject of a public meeting held to discuss the authority's 
inability to comply with Texas Transportation Code, sec.451.301, and the 
alternative implementation schedule. 
 
       
  sec.114.36. Reporting.  Affected entities must submit annual reports to the 
executive director. The report must contain the following: 
 
  (1) the fleet identification number (when assigned); 
   
  (2) vehicle license numbers, model years, manufacturers, model types, vehicle 
identification numbers, gross vehicle weight rating, fuel type(s) and certified 
emission standards of each vehicle; 
   
  (3) an estimate of the annual vehicle miles traveled (VMT) for each covered 
fleet vehicle; 
   
  (4) documentation demonstrating the percentage of the vehicle's operation on 
the clean-fuel, as documented by the VMT operated on the clean-fuel, if the 
vehicle is a dual-fuel vehicle; and 
   
  (5) a demonstration of compliance with the applicable implementation schedule. 
 
     
  sec.114.37. Record Keeping. <ol> Affected entities shall maintain copies of 
the reports required by sec.114.36 of this title (relating to Reporting) on-site 
at the reported fleet address for a minimum of three years and shall make such 
reports available to the executive director or local air pollution control 
agencies having jurisdiction in the area upon request. 
 
   
  sec.114.38. Program Compliance Credits. 
 
  (a) Program Compliance Credits (PCCs) may be awarded only to affected entities 
for any of the following, or any combination thereof: 
 
  (1) The acquisition of a clean-fuel vehicle which is certified to a more 
stringent emission standard than the low emission vehicle (LEV) emission 
standards, which include; 
 
  (A) ultra low emission vehicle (ULEV) certified clean-fuel vehicles; 
   
  (B) inherently low emission vehicle (ILEV) certified clean-fuel vehicles; or 
   
  (C) zero emission vehicle (ZEV) certified clean-fuel vehicles. 
     
  (2) The acquisition of clean-fuel vehicles in greater numbers than otherwise 
required; 
   
  (3) The acquisition of a clean-fuel vehicle not defined as a fleet vehicle 
pursuant to sec.114.30 of this title (relating to Definitions); 
   
  (4) The purchase, lease, or acquisition of a clean-fuel vehicle prior to the 
dates required; 
   
  (5) The purchase of one of the following clean-fuel vehicles not otherwise 
required: 
 
  (A) law enforcement vehicles; 
   
  (B) emergency vehicles; 
   
  (C) non-road vehicles; or 
   
  (D) vehicles over 26,000 lbs. gross vehicle weight rating when operated by 
local governments or private persons. 
       
  (b) PCCs shall be awarded in two-year increments from 1998 until 2002. After 
2002, credits shall be awarded according to the estimated remaining useful life 
of the vehicle. 
   
  (c) PCCs may be used to demonstrate compliance with clean-fuel vehicle 
provisions and requirements of this chapter, or may be banked for later use, or 
they may be traded, sold, or purchased, for use by any other person in the same 
non-attainment area, to demonstrate compliance with the clean-fuel vehicle 
provisions and requirements of this chapter. 
   
  (d) PCCs have the following values: 
 
  (1) LEV-one credit; 
   
  (2) ULEV-two credits; and 
   
  (3) ILEV and ZEV-three credits. 
     
  (e) Affected entities proposing to generate PCCs pursuant to this chapter may 
apply at any time to the executive director. A current fleet report containing 
the information in sec.114.36 of this title (relating to Reporting) must 
accompany the application. Affected entities may also indicate their desire to 
obtain PCCs concurrent with fleet registration or annual reporting. The 
submission of additional vehicle or fleet information may be required. 
   
  (f) PCCs will be banked with the Mobile Source Division. 
   
  (g) Upon verification by the executive director: 
 
  (1) each fleet will be issued a certificate where applicable; and 
   
  (2) a total emissions credit summary sheet will be issued to the fleet. 
 
       
  sec.114.39. Mobile Emission Reduction Credit Program. 
 
  (a) Mobile Emission Reduction Credits (MERCs) shall be based on the difference 
between the emissions from the clean-fuel vehicle and the conventional vehicle, 
and shall be awarded to affected entities and to individuals located within the 
state's non-attainment areas who: 
 
  (1) Have vehicles which are certified to more stringent emissions standards 
than the low emission vehicle (LEV) emission standards, which include: 
 
  (A) ultra low emission vehicle certified clean-fuel vehicles, 
   
  (B) inherently low emission vehicle certified clean-fuel vehicles, and 
   
  (C) zero emission vehicle certified clean-fuel vehicles; or 
     
  (2) Operate more clean-fuel vehicles than otherwise required; 
   
  (3) Operate clean-fuel vehicles in a category or class not required, which 
include: 
 
  (A) law enforcement vehicles, 
   
  (B) emergency vehicles, 
   
  (C) vehicles over 26,000 lbs. gross vehicle weight rating when operated by 
local governments or private persons, and 
   
  (D) non-road vehicles; or 
     
  (4) Operate clean-fuel vehicles prior to the dates required. 
     
  (b) MERCs may be: 
 
  (1) used to demonstrate compliance with the clean-fuel vehicle provisions and 
requirements of this chapter or any other mobile source program that has 
marketable credits; 
   
  (2) banked for later use; or 
   
  (3) traded, sold, or purchased for use by any other person in the same non-
attainment area to demonstrate compliance with the clean-fuel vehicle provisions 
and requirements of this chapter. 
     
  (c) The following restrictions apply to the trading or purchasing of fleet to 
fleet MERCs: 
 
  (1) Trades are restricted to the non-attainment area in which they are 
generated; 
   
  (2) Light-duty vehicle MERCs are restricted to trading within the light-duty 
class; 
   
  (3) Heavy-duty vehicle MERCs may be traded within their specific subclass or 
from a heavier vehicle to a lighter vehicle (downward trading) within the heavy-
duty class; and 
   
  (4) In order for credits to be certified as tradable for stationary sources, 
fleets must have a minimum of 1 ton per year reduction. 
     
  (d) For fleet to fleet trading or demonstration of compliance, MERCs shall be 
quantified in terms of fleet to fleet credits using the following equation: 
     
  <ol>Figure 1: 30 TAC sec.114.39(d) 
 
  (e) For trades to stationary sources, the following methodology is used for 
the calculation of MERCs for: 
 
  (1) early purchase of clean-fuel vehicles; 
   
  (2) the purchase or acquisition of additional or excluded vehicles that meet 
the LEV standard; 
   
  (3) the purchase or acquisition of vehicles which are certified to emission 
standards more stringent than the LEV standards; or 
   
  (4) evaporative credit, as generated by vehicles that have no hydrocarbon 
evaporative emissions, as accomplished through the modification of the vehicle 
to operate solely on a fuel with no evaporative emissions. 
   
  (5) Stationary Source MERC Calculation Equation: 
       
  <ol>Figure 2: 30 TAC sec.114.39(e)(5) 
 
  (f) In order to apply for a MERC, an affected entity or individual must submit 
the following information to the executive director: 
 
  (1) the certified emission standard of the vehicle for which the affected 
entity or individual wishes to make an application for credit; 
   
  (2) the annual VMT traveled by the vehicle; 
   
  (3) the amount of time in years this vehicle is expected to be in service; and 
   
  (4) a current fleet report containing the information in sec.114.36 of this 
title (relating to Reporting). The submission of additional vehicle or fleet 
information may be required at this time. 
     
  (g) MERCs for trading between fleets will be banked with the Mobile Source 
Division. 
   
  (h) MERCs for trading between fleets and stationary sources will be banked 
with the Emissions Bank. 
   
  (i) Upon certification by the executive director, each vehicle will be issued 
a certificate indicating, where applicable: 
 
  (1) the standard to which the vehicle is certified; 
   
  (2) the weight class of the vehicle; 
   
  (3) the amount of emissions reduced per year in tons; 
   
  (4) the number of years the emission reductions will be credited; and 
   
  (5) the number of light-duty or heavy-duty vehicle fleet to fleet MERCs. 
     
  (j) A total emissions credit summary sheet will be issued to the fleet upon 
issuance of any MERC certificate. 
   
  (k) MERCs shall be awarded in two-year increments for the period of 1998 
through 2002. After 2002, MERCs shall be awarded according to the expected 
remaining useful life of the vehicle. 
   
  (l) The following shall be considered violations of the Texas Mobile Emission 
Reduction Credit Program: 
 
  (1) claiming a MERC without meeting the appropriate acquisition requirements; 
   
  (2) submission of false date as information requested by commission rules; or 
   
  (3) counterfeiting or dealing commercially in counterfeit MERC certificates. 
     
  (m) Any person found to be in violation of the Texas Mobile Emission Reduction 
Credit Program shall be subject to a civil penalty of not more than $25,000 per 
violation. 
 
     
  sec.114.40. The Texas Mobile Emission Reduction Credit Fund. 
 
  (a) Mobile emission reduction credits may be assigned through the Texas Mobile 
Emission Reduction Credit Trading Fund as established by this section to 
affected entities provided: 
 
  (1) the affected entity enters into a binding contract with the commission, 
agreeing to purchase and place in service in designated program areas clean-fuel 
vehicles in accordance with the number of credits issued and the time frame 
specified by the commission; and 
   
  (2) the affected entity agrees to name the United States Environmental 
Protection Agency as a third-party beneficiary of its contract with the 
commission. 
     
  (b) Contracts entered into under this section may be enforced in the courts of 
the State of Texas by an order of specific performance. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be a valid exercise of the agency's authority. 
 Issued in Austin, Texas, on April 24, 1996. 
 TRD-9605692 
  Kevin McCalla 
 Director, Legal Services Division 
 Texas Natural Resource Conservation Commission 
    Proposed date of adoption: July 24, 1996 
 For further information, please call: (512) 239-1970 
         
             Chapter 115. Control of Air Pollution From Volatile Organic 
Compounds 
  
  Subchapter G. Consumer-Related Sources 
 
  Consumer Products 
 
  30 TAC sec.115.616 
 
  The commission proposes an amendment to Subchapter G (Consumer-Related 
Sources; Consumer Products), sec.115.616, concerning Recordkeeping and Reporting 
Requirements. Subchapter G ("consumer products rule") was adopted May 4, 1994 in 
response to the Federal Clean Air Act (FCAA) requirement for states to adopt 
Rate-of-Progress State Implementation Plans which achieve by November 15, 1996, 
a 15% net-of-growth reduction in the volatile organic compound (VOC) emissions 
level in each ozone nonattainment area. Most consumer products regulated under 
the rule were required to be in compliance with the rule's VOC content 
limitation if manufactured after January 1, 1995, with the remainder after 
January 1, 1996. For practical enforcement and product distribution reasons, the 
rule applies statewide. 
 Existing sec.115.616(a) requires that each consumer product container or 
package display the day, month, and year of manufacture, or a code indicating 
that date, if it is manufactured after January 1, 1995. Dating the product 
facilitates determination of whether the product is subject to the applicable 
standard. Dating also could facilitate determining the magnitude of a compliance 
problem, if the problem was limited to products manufactured over a specific 
period. As an alternative to this product dating requirement, the proposed 
amendment would allow manufacturers of regulated consumer products to display 
information on the product container or package, upon written request to the 
Executive Director and receipt of written approval, which enables determination 
of the applicable VOC limitation for the product. The proposed rule amendment 
would provide additional flexibility and cost savings to regulated industries 
without affecting the state's ability to effectively enforce the rule. 
 Stephen Minick, Strategic Planning and Appropriations Division, has determined 
that for the first five-year period the section as proposed is in effect, there 
are no significant fiscal implications anticipated for state and local 
governments as a result of administration or enforcement of the sections. 
Equipment costs for businesses to comply with the current rule are estimated at 
$15,000 per date stamping machine, with the possible need for several machines 
per business. The proposed amendment provides cost savings comparable to these 
estimated costs by providing affected businesses with an alternative method of 
rule compliance. 
 The proposed rule amendment is expected to have a proportionally greater cost 
savings impact on small businesses than for larger ones, because small 
businesses generally have smaller capital investments, and larger businesses 
typically provide date stamp coding for additional reasons such as formulation, 
production, and inventory control. Since regulated industries have had to comply 
with the rule's current date stamping provision since January 1, 1995, the 
overall potential industry-wide cost savings resulting from the rule amendment 
is small. For small businesses which do not substantially change product 
formulations over time, an alternative means of rule compliance represents 
greater potential cost savings for small businesses than for larger ones. 
 Mr. Minick also has determined that for each year of the first five years the 
section as proposed is in effect, the public benefit anticipated as a result of 
implementing the section will be satisfaction of FCAA amendments and the United 
States Environmental Protection Agency requirements, and VOC emission reductions 
in ozone nonattainment areas which are necessary for the timely attainment of 
the ozone standard. There are no economic costs anticipated for any individual 
required to comply with the sections as proposed. 
 The commission has prepared a Takings Impact Assessment for these rules 
pursuant to Texas Government Code Annotated, sec.2007.043. The following is a 
summary of that assessment. The specific purpose of the rule amendment is to 
provide an alternative method of complying with the rule's date stamping 
requirement. The rule amendment will substantially advance this specific purpose 
by allowing certain identifying information to be displayed on the package 
container or label. Promulgation and enforcement of this rule amendment will not 
affect private real property which is the subject of the rule because the change 
is only to provide an alternative method of rule compliance. 
 A public hearing on this proposal will be held May 28, 1996, at 10:00 a.m. in 
Building F, Room 2210 at the Texas Natural Resource Conservation Commission 
complex, located at 12100 North IH-35, Park 35 Circle, Austin. Individuals may 
present oral statements when called upon in order of registration. Open 
discussion within the audience will not occur during the hearing; however, an 
agency staff member will be available to discuss the proposal 30 minutes prior 
to the hearing and will answer questions before and after the hearing. 
 Written comments may be mailed to Heather Evans, TNRCC Office of Policy and 
Regulatory Development, MC 205, P.O. Box 13087, Austin, Texas 78711-3087 or 
faxed to (512) 239-4808. All comments should reference Rule Log Number 96117-
115-AI. Comments must be received by 5:00 p.m., June 7, 1996. For further 
information, please contact Mike Magee, Air Policy and Regulations Division, 
(512) 239-1511. 
 Persons with disabilities who have special communication or other accommodation 
needs who are planning to attend the hearings should contact the agency at (512) 
239-4900. Requests should be made as far in advance as possible. 
 The amendment is proposed under the Texas Health and Safety Code (Vernon 1992), 
the Texas Clean Air Act (TCAA), sec.382.017, which provides the commission with 
the authority to adopt rules consistent with the policy and purposes of the 
TCAA. 
 The proposed amendment implements the Health and Safety Code, sec.382.017. 
 
 
  sec.115.616. Recordkeeping and Reporting Requirements. 
 
  (a) Each manufacturer of a consumer product subject to sec.115.612 of this 
title (relating to Control Requirements) shall clearly display on each consumer 
product container or package[,] the day, month, and year on which the product 
was manufactured, [or] a code indicating such date<nl>, or other information, 
upon written request to the Executive Director and receipt of written approval, 
which enables determination of the applicable volatile organic compound 
limitation for the product<ol>. This date<nl>,<ol> [or] code <nl>, or other 
approved identifying information<ol> shall be displayed on each [consumer 
product] container or package <nl>for any consumer product regulated under this 
subchapter<ol> which is manufactured after January 1, 1995. 
   
  (b)-(d) (No change.) 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be a valid exercise of the agency's authority. 
 Issued in Austin, Texas, on April 24, 1996. 
 TRD-9605694 
  Kevin McCalla 
 Director, Legal Services Division 
 Texas Natural Resource Conservation Commission 
    Proposed date of adoption: July 24, 1996 
 For further information, please call: (512) 239-1970 
         
                     
  TITLE 37. PUBLIC SAFETY AND CORRECTIONS 
 Part III. Texas Youth Commission 
  Chapter 93. General Provisions 
  
  Transportation of Youth 
 
  37 TAC sec.93.31 
 
  The Texas Youth Commission (TYC) proposes an amendment to sec.93.31, 
concerning transportation of youth. The amendment consists of edits only. There 
are no other changes. 
 John Franks, Director of Finance, has determined that for the first five-year 
period the section is in effect there will be no fiscal implications for state 
or local government as a result of enforcing or administering the section. 
 Mr. Franks also has determined that for each year of the first five years the 
section is in effect the public benefit anticipated as a result of enforcing the 
section will be clarification of confusing sentence structure. There will be no 
effect on small businesses. There is no anticipated economic cost to persons who 
are required to comply with the section as proposed. 
 Comments on the proposal may be submitted to Gail Graham, Policy and Manuals 
Coordinator, Texas Youth Commission, 4900 North Lamar Boulevard, P.O. Box 4260, 
Austin, Texas 78765. 
 The amendment is proposed under the Human Resources Code, sec.61.034, which 
provides the Texas Youth Commission with the authority to make rules appropriate 
to the accomplishment of its functions. 
 The proposed amendment implements the Human Resource Code, sec.61.034. 
 
 
  sec.93.31. Transportation of Youth. 
 
  (a) The statewide transportation unit, regional transportation unit, and 
individual program staff may <nl>transport <ol> [transportation] or coordinate 
the transportation of Texas Youth Commission (TYC) youth among its facilities 
and community corrections programs. [is coordinated by] 
   
  (b)-(d) (No change.) 
   
  (e) Mechanical restraints will be used when youth are being transported by the 
transportation unit and by others when transporting youth to a placement of 
greater restriction  <nl>than<ol> [that] their current program. Mechanical 
restraints may be used during transportation by others when circumstances create 
a risk of escape or harm. All use of mechanical restraint during transportation 
shall be accordance with GOP.67.09, sec.91.59 of this title, relating to Use of 
Force. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 25, 1996. 
 TRD-9605789 
  Steve Robinson 
 Executive Director 
 Texas Youth Commission 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 483-5244 
         
                   
  TITLE 40. SOCIAL SERVICES AND ASSISTANCE 
 Part XX. Texas Workforce Commission 
  Chapter 805. Job Training Partnership Act 
  
  Subchapter A. General Provisions and Definitions 
 
  40 TAC sec.sec.805.101-805.106 
 
  The Texas Workforce Commission proposes amendments to sec. s805.101-805. 105 
and new sec.805.106, concerning rules to implement the Job Training Partnership 
Act (JTPA), pursuant to Texas Labor Code, sec.301.061(a) which authorizes the 
Texas Workforce Commission to adopt rules to administer the Workforce and 
Economic Competitiveness Act (Title 10, Chapter 2308, Government Code), and 
Texas Labor Code, sec.302.002(d) which authorizes the Texas Workforce Commission 
to adopt rules necessary for the administration of the Division of Workforce 
Development. 
 The Sections provide the title and purpose of these rules, define terms 
commonly used in the JTPA programs, designate the entities for state 
administration, and implement the United States Department of Labor regulations. 
 The revised sections are proposed to replace references to the Texas Department 
of Commerce with references to the Texas Workforce Commission, which pursuant to 
Texas Government Code, sec.301.063(a)(2) is the state administrative entity for 
the JTPA; to remove references to a state JTPA which was repealed by Acts 1995, 
74th Legislature, Chapter 655; and to amend the definition of a Private Industry 
Council to include a certified Local Workforce Development Board. 
 New sec.805.106 is proposed to implement the federal JTPA regulations, except 
as noted, with a legally effective date of January 1, 1995. 
 Fabian Gomez, JTPA Attorney, Texas Workforce Commission, has determined that 
for the first five-year period the sections are in effect there will be no 
fiscal implications for state or local government as a result of enforcing or 
administering the sections. 
 Mr. Gomez also has determined that for each year of the first five years the 
proposed sections are in effect, the public benefits anticipated as a result of 
enforcing the sections will be to facilitate the development and implementation 
of effective state and local systems for managing job training, employment and 
related programs in this state. There will be no effect on small businesses. 
There is no anticipated economic cost to persons who are required to comply with 
the sections as proposed. 
 Written comments on the proposed rules may be submitted to Margo Kaiser, JTPA 
Attorney, Texas Workforce Commission, 211 East 7th Street, Suite 1000, Austin, 
Texas 78701, within 30 days of the publication of the proposed sections. 
 The new section and amendments are proposed under the Texas Labor Code, 
sec.301.061(a), which authorizes the Texas Workforce Commission to adopt rules 
to administer the Workforce and Economic Competitiveness Act (Title 10, Chapter 
2308, Government Code), and Texas Labor Code, sec.302.002(d), which authorizes 
the Texas Workforce Commission to adopt rules necessary for the administration 
of the Division of Workforce Development; and pursuant to the Administrative 
Procedure Act, Texas Government Code, Chapter 2001, Subchapter B, which mandates 
the rulemaking procedures for state agencies. 
 The following statutes are affected by the proposed sec. s805.101-805.106: 
Texas Labor Code, sec.301.063(a)(2) Texas Government Code, sec.sec.2308.204, 
2308. 303(a)(6) and 2308.304(a)(1). 
 
 
  sec.805.101. Short Title and Purpose. These rules may be cited as the Texas 
Job Training Partnership Act Rules. The purpose of these rules is to implement 
and interpret the provisions of the [federal and state] Job Training Partnership 
<nl>Act<ol>[Acts], (29 United States Code, sec.1501 et seq., as amended) [Texas 
Labor Code, sec.sec.301.001 et seq.; Texas Civil Statutes, Art. 4413(52), as 
amended)]. 
 
   
  sec.805.102. General Definitions. <ol> For purposes of implementing the [state 
and federal]Job Training Partnership <nl>Act <ol>[Acts], the definitions found 
in [the State Act, Texas Labor Code, sec.301.005; the Federal] Act, 29 United 
States Code, sec.1503; and the Code of Federal Regulations (CFR) , 29 CFR  
s626.5, are adopted herein. In addition, the following words and terms when used 
in this chapter shall have the following meanings, unless the context clearly 
indicates otherwise. 
   
     <nl>Commission-The Texas Workforce Commission. 
   
   [Department-The Texas Department of Commerce.] 
   
   Executive Director -The executive director of the<nl>commission<ol> 
[department], or his or her designee. 
   
     <nl>The<ol> [Federal] Act-The [federal] Job Training Partnership Act (29 
United States Code, sec.1501 et seq.), hereinafter cited with references to 
Public Law 97-300, October 13, 1982, 96 Stat. 1322, as amended. 
   
   Federal Regulations -The [Interim] Final Rules of the United States 
Department of Labor, Job Training Partnership Act (20 Code of Federal 
Regulations, Parts 626-631 and 637). 
   
   JTPA-The [federal and state] Job Training Partnership <nl>Act<ol>[Acts] and 
the various programs established under such laws to prepare youth and adults 
facing serious barriers to employment for participation in the labor force by 
providing job training and other job services. 
   
   Private industry council-A local council whose members reasonably represent 
the industrial and demographic composition of the private and business 
communities, and whose responsibility is to provide guidance and oversight with 
respect to JTPA activities within their respective service delivery area.<nl> 
Also included in the term private industry council is any certified Local 
Workforce Development board created pursuant to 40 TAC sec.801. 1, which has 
assumed the responsibilities of a private industry council. <ol>The private 
industry council is sometimes referred to herein as a PIC. 
   
   Program year-The 12-month period beginning on July 1 in the fiscal year for 
which appropriations are made for programs and activities under the [state or 
federal]Job Training Partnership Act. 
   
   Service delivery area-A geographic area designated as a service delivery 
area<nl> by the Governor <ol> [ under Texas Labor Code, sec.301.041 ], also 
referred to as an SDA. 
   
   [State Act-The Texas Job Training Partnership Act (Texas Labor Code, 
sec.sec.301.001 et seq.).] 
   
   State Council-The Texas Council on Workforce and Economic Competitiveness 
[(Acts 1993, 73rd Legislature, Chapter 668, effective September 1, 1993) ]. 
   
   Substate area-A single service delivery area, or a consortium of contiguous 
service delivery areas, designated to provide delivery of JTPA Title III program 
services pursuant to<nl>the <ol> [Federal] Act sec.312 and Federal Regulations 
20 CFR sec.sec.631.34 and 631.35. Also referred to as an SSA. 
 
   
  sec.805.103. General Duties of Governor's Office.  The governor is responsible 
for the planning, monitoring, implementing, and evaluating of job training, 
employment and related programs under the authority of<nl> the Act <ol>[Texas 
Labor Code, sec.301.021 and the provisions of the Federal Act] and Federal 
Regulations, including, without limitation, the specific duties and procedures 
described in these rules. The governor may develop policies the governor deems 
necessary to implement the provisions of the<nl>Act<ol> [State and Federal 
Acts], independent of these rules. 
 
   
  sec.805.104. General Duties of the Texas <nl>Workforce Commission [Department 
of Commerce]. 
 
  (a) Pursuant to Texas Labor Code, sec.<nl>302.002 <ol>[ 301.022], the Texas 
<nl>Workforce Commission<ol>[Department of Commerce] has the primary 
responsibility for implementing and managing the Job Training Partnership Act, 
and performing other functions relating to the JTPA as assigned by the governor. 
   
  (b) The <nl>Commission<ol>[policy board of the department] adopts rules 
necessary to implement and manage the JTPA, as provided in <nl>Texas Labor Code, 
sec.302.002(d).<ol> [Acts 1993, 73rd Legislature, Chapter 986, sec.29.] 
   
  (c) In administering the general duties of the <nl>Commission <ol> 
[department] concerning the Job Training Partnership Act, the executive director 
[or the executive director's designee] may waive any provision of Chapter 805 of 
this title (relating to Job Training Partnership Act Rules) in order to 
effectuate the purposes of the [federal and state] Job Training Partnership 
<nl>Act<ol> [Acts], and the federal regulations, where such provision is not 
necessary for the protection of the public interest. 
   
  [(d) A proceeding of the department involving the JTPA is not subject to the 
provisions of the Administrative Procedure Act and its subsequent amendments 
relating to contested cases.] 
 
     
  sec.805.105. The Texas Council on Workforce and Economic Competitiveness. 
 
  (a) Pursuant to the provisions of <nl>Texas Government Code, sec.2308. 052 
<ol>[ Senate Bill 642, Acts 1993, 73rd Legislature], the members of the Texas 
Council on Workforce and Economic Competitiveness (State Council) are appointed 
by the governor. 
   
  (b) Pursuant to<nl> Texas Government Code, sec.2308.102<ol>[  s2.11, Senate 
Bill 642, Acts 1993, 73rd Legislature], and as authorized by <nl>the<ol>[ 
Federal] Act sec.122 [and Texas Labor Code, sec.301.024], the duties of the 
former State Job Training Coordinating Council are assumed by the State Council. 
 
     
  sec.805.106. Implementation of USDOL Final Rule.  All of the Final Rule, 20 
CFR Parts 626-638 and Part 1005, adopted by the U.S. Department of Labor and 
published on September 2, 1994 in the Federal Register in Volume 59, No. 170 at 
45760 except for  s628.510(f)(2) is effective in Texas on January 1, 1995. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be a valid exercise of the agency's authority. 
 Issued in Austin, Texas, on April 25, 1996. 
 TRD-9605753 
  Carol Kingsbery Otto 
 Attorney, Intergovernmental Relations 
 Texas Workforce Commission 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 463-7833 
         
           
  Subchapter C. Job Training Plans 
 
  40 TAC sec.sec.805.140-805.148, 805.150-805.155 
 
  The Texas Workforce Commission proposes amendments sec. s805.140-805.148, 
805.150-805.155, concerning rules to implement the Job Training Partnership Act 
(JTPA), pursuant to Texas Labor Code, sec.301.061(a) which authorizes the Texas 
Workforce Commission to adopt rules to administer the Workforce and Economic 
Competitiveness Act (Title 10, Chapter 2308, Government Code), and Texas Labor 
Code, sec.302.002(d) which authorizes the Texas Workforce Commission to adopt 
rules necessary for the administration of the Division of Workforce Development. 
 The sections define and facilitate the establishment of job training plans 
prepared by the local service delivery areas and substate areas. 
 The revised sections are proposed to replace references to the Texas Department 
of Commerce with references to the Texas Workforce Commission, which pursuant to 
Texas Government Code, sec.301.063(a)(2) is the state administrative entity for 
the JTPA; to remove references to a state JTPA which was repealed by Acts 1995, 
74th Legislature, Chapter 655. Section 805.151 (relating to Rapid Response 
Grants) is amended to allow local programs to provide support services as part 
of a rapid response system. Section 805.154 (relating to Discretionary fund 
Distribution Process) is amended to describe the method of developing a vendors 
list of qualified service providers with whom local programs may contract for 
rapid response services. 
 Fabian Gomez, JTPA Attorney, Texas Workforce Commission, has determined that 
for the first five-year period the sections are in effect there will be no 
fiscal implications for state or local government as a result of enforcing or 
administering the sections. 
 Mr. Gomez also has determined that for each year of the first five years the 
proposed sections are in effect, the public benefits anticipated as a result of 
enforcing the sections will be to facilitate the development and implementation 
of effective state and local systems for managing job training, employment and 
related programs in this state. There will be no effect on small businesses. 
There is no anticipated economic cost to persons who are required to comply with 
the sections as proposed. 
 Written comments on the proposed rules may be submitted to Margo Kaiser, JTPA 
Attorney, Texas Workforce Commission, 211 East Seventh Street, Suite 1000, 
Austin, Texas 78701, within 30 days of the publication of the proposed sections. 
 The amendments are proposed under the Texas Labor Code,  s301.061(a), which 
authorizes the Texas Workforce Commission to adopt rules to administer the 
Workforce and Economic Competitiveness Act (Title 10, Chapter 2308, Government 
Code), and Texas Labor Code, sec.302.002(d) which authorizes the Texas Workforce 
Commission to adopt rules necessary for the administration of the Division of 
Workforce Development; and pursuant to the Administrative Procedure Act, Texas 
Government Code, Chapter 2001, Subchapter B, which mandates the rulemaking 
procedures for state agencies. 
 The following statutes are affected by the proposed sec. s805.140-805.155: 
Texas Labor Code, sec.301.063(a)(2) Texas Government Code, sec.sec.2308.204, 
2308. 303(a)(6) and 2308.304(a)(1). 
 
 
  sec.805.140. Plan Submission for Review and Approval. <ol> All SDA job 
training plans developed pursuant to <nl>the<ol> [Federal] Act sec.103 and 
sec.104, [Texas Labor Code, sec.301.046], and all SSA substate plans developed 
pursuant to  <nl>the<ol> [Federal] Act sec.313, shall be submitted to the 
<nl>Commission<ol> [department] at the address shown in sec.805.131 of this 
title (relating to Address for all Submissions, Notices, and Requests for 
Information or Forms). 
 
   
  sec.805.141. Standards for Plan Approval or Disapproval. <ol> A Title II job 
training plan or a Title III substate plan will be approved unless that plan 
does not comply with the elements listed in <nl>the<ol> [Federal] Act 
sec.105(b)(1), or does not provide for sufficient resources, services, and level 
of activities to meet annual performance standards. 
 
   
  sec.805.142. Plan Modification or Amendment. An approved two-year plan may be 
changed by either modification or amendment. Either method of change must be 
submitted to the <nl>Commission<ol> [department] for review before 
implementation. Each subrecipient submitting a plan modification or amendment 
must provide evidence that the PIC and Chief Elected Official(s) (CEOs) are 
aware of the intent and substance of the change. The Program Summary and 
Statement of Approval form, available from the <nl>Commission<ol> [department], 
may be used to transmit a plan change to the <nl>Commission<ol> [department] to 
document that the PIC and CEO(s) have been advised of the amendment. 
 
   
  sec.805.143. Criteria for Plan Modification. 
 
  (a) A plan modification is a revision of an approved plan which requires 
approval by the PIC and CEO(s) of a service delivery area and must be submitted 
jointly to the State Council and governor for review and approval. A plan 
modification is subject to the provisions of <nl>the<ol> [Federal] Act sec.104 
and sec.105, and notice of the modification must be published in a newspaper of 
general circulation by the SDA for public review and comment no later than 80 
days before the effective date of the modification. 
   
  (b) A plan modification must be submitted to the  <nl>Commission<ol> 
[department] if any of these conditions occur: 
 
  (1)-(3) (No change.) 
 
       
  sec.805.144. Criteria for Plan Amendment. 
 
  (a) A plan amendment is a minor adjustment to an approved job training plan 
and does not require publication or approval by the PIC and CEO(s) of the 
service delivery area, prior to submission to the <nl>Commission<ol> 
[department]. Plan amendments may be either formal or administrative, described 
as follows: 
 
  (1) Formal-An amendment that includes changes affecting the approved job 
training plan contract. Formal amendments must be submitted to the 
<nl>Commission<ol> [department] at least 30 days prior to the effective date of 
the amendment. A contract amendment reflecting those items affected by the plan 
amendment must also be submitted for review. 
   
  (2) Administrative-An administrative amendment is used for all other changes 
to an approved job training plan which do not affect the contract. 
Administrative amendments must be submitted to the <nl>Commission<ol> 
[department] by letter at least 15 days prior to the effective date of the 
amendment. 
     
  (b)-(d) (No change.) 
   
  (e) If SDAs and SSAs have established a local policy that plan amendments must 
be approved by the PIC chair and CEO prior to submission to the 
<nl>Commission<ol> [department], a statement of their approval must be included 
with the plan amendment submitted. 
 
     
  sec.805.145. Competency System Development and Approval.  Each SDA shall 
develop adult and youth competency systems to enhance the employability of JTPA 
participants. Such competency systems must be approved by official action of the 
PIC and by the <nl>Commission<ol> [department]. SDAs and PICs must develop 
systems reflecting employer driven skills standards. Competency statements and 
the overall level of achievement required for successful completion of each 
competency system must be approved by official action of the PIC, as evidence 
that the content to be mastered and the level of mastery represent what is 
required for employment at the local level. 
 
   
  sec.805.146. Submission for State Approval. 
 
  (a) After being approved by a PIC, each new or revised competency plan must be 
submitted to the <nl>Commission <ol> [department] for approval, prior to 
participant enrollment in competency related training activities. Each new 
submission must include evidence that the PIC and CEO(s) approve of the 
submission (e.g., a Program Summary and Statement of Approval Form may be used) 
, and a cover letter describing the request and the name of the appropriate SDA 
contact person. 
   
  (b) (No change.) 
   
  (c) The <nl>Commission<ol> [department] has authority to monitor and review 
previously approved SDA competency systems, and may require periodic submissions 
of revised competency systems, to ensure that SDAs continue to assess the 
effectiveness of their competency systems. 
 
     
  sec.805.147. Elements of a Sufficiently Developed Competency System. 
 
  (a) Each competency system submitted to the <nl>Commission <ol> [department] 
for approval shall include all required elements of a sufficiently developed 
competency system, as described in the guidelines for PIC-Recognized Youth 
Employment Competencies in Appendix B, 55 Federal Register 20343. 
   
  (b) (No change.) 
 
     
  sec.805.148. Substate Plans. 
 
  (a) After initial review of an SSA's plan, the <nl>Commission <ol> 
[department] will inform each SSA of any deficiencies. 
   
  (b) The governor is authorized to grant final approval or disapproval of a 
plan in accordance with <nl>the <ol> [Federal] Act sec.105(b)(1)-(3) and 20 CFR 
sec.631.50. 
 
     
  sec.805.150. Services to Displaced Homemakers. SSAs may furnish services to 
displaced homemakers, pursuant to <nl>the<ol> [Federal] Act sec.311(b)(4), if 
the SSAs determine that services to displaced homemakers would not have an 
adverse impact on the delivery of services to eligible dislocated workers based 
upon local demand for service and the local economy. SSAs furnishing such 
services must document their analysis of these factors in their Title III 
substate plan. 
 
   
  sec.805.151. Rapid Response Grants. 
 
  (a) Pursuant to <nl>the<ol> [Federal] Act sec.314(b) and 20 CFR sec.631. 
30(b), the <nl>the<ol> [Federal] may contract with a local SSA to expedite the 
provision of services in cases of substantial layoffs as defined in 20 CFR  
s631.2, or a public announcement by an employer of fifty or more workers of an 
impending closure of a specific facility including the planned date of final 
closure. 
   
  (b) (No change.) 
   
  (c) SSAs shall submit a letter of request for rapid response funds together 
with a corresponding line-item budget which appropriates costs to the proper 
cost categories of rapid response<nl>, <ol> [or] basic readjustment <nl>or 
support services <ol>. SSAs shall thereafter submit [a] budget <nl>and 
performance reports<ol> [report] to the <nl>Commission<ol> [department] on a 
monthly basis for each layoff for which the SSA has received rapid response 
funds. 
   
  (d)-(e) (No change.) 
   
  (f) The local SSAs shall address dislocations involving fewer than <nl>50<ol> 
[51] workers, except when substate action or resources are not available or are 
deemed insufficient by the <nl>Commission <ol> [department] . 
 
     
  sec.805.152. Certificate of Continuing Eligibility. An SSA that elects to 
issue a Certificate of Continuing Eligibility (CCE), pursuant to <nl>the<ol> 
[Federal] Act sec.316(b), must include in its Title III plan, for review and 
approval by the <nl>Commission<ol> [department], a copy of the Certificate of 
Continuing Eligibility and a description of the SSA's policy regarding the 
following: 
 
  (1)-(4) (No change.) 
 
     
  sec.805.153. Allotment of Dislocated Worker State Reserve Funds.  To achieve 
an equitable distribution of funds reserved to the state pursuant to <nl>the 
<ol> [Federal] Act sec.302(c), the Governor may reserve not more than 40% of the 
amount of allotted funds to the state under sec.302(a)(1) for: 
 
  (1) state administration, technical assistance, and coordination of the 
programs authorized under the [Federal] Act; 
   
  (2) (No change.) 
   
  (3) rapid response activities as described in <nl>the <ol> [Federal] Act 
sec.314(b); 
   
  (4)-(5) (No change.) 
 
     
  sec.805.154. Discretionary Fund Distribution Process. 
 
  (a) The discretionary funds allotted to the substate areas shall be 
distributed as follows: 
 
  (1) If a layoff occurs due to a large dislocation or military base closing, 
the local SSA shall meet with the  <nl>Commission<ol> [department] dislocated 
worker staff to determine its capacity to provide immediate employment and 
training services. 
   
  (2) (No change.) 
   
  (3) <nl>The Commission will establish and maintain a list of qualified rapid 
response service providers. Periodically, the Commission will issue a request 
for information which will obtain information regarding the capacity and 
experience of SSAs, SSA consortia as well as public and private agencies and 
organizations to provide rapid response services. The SSAs or the Commission may 
contract with qualified vendors for rapid response services after obtaining bids 
from at least three of the vendors on the list. <ol> [The department will 
establish the capability of delivering rapid response services by issuing a 
request for proposals for a statewide or regional rapid response service 
provider(s) early in the program year to SSAs or SSA consortia and public or 
private agencies and organizations. The resulting contract will be activated on 
an as-needed basis if the state determines that the local SSA, or other local 
provider, is unable to directly provide necessary rapid response services.] 
     
  (b) (No change.) 
 
     
  sec.805.155. Waiver of Expenditures for Retraining Services.  Substate 
grantees that request a waiver of the 50% retraining cost limitation for basic 
readjustment services, pursuant to <nl>the<ol> [Federal] Act sec.315(a)(2), must 
submit the following information to the <nl>Commission <ol> [department] as an 
attachment to their proposed job training plan: 
 
  (1)-(2) (No change.) 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be a valid exercise of the agency's authority. 
 Issued in Austin, Texas, on April 25, 1996. 
 TRD-9605755 
  Carol Kingsbery Otto 
 Attorney, Intergovernmental Relations 
 Texas Workforce Commission 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 463-7833 
         
             
  Subchapter D. Performance Standards 
 
  40 TAC sec.sec.805.160-805.165 
 
  The Texas Workforce Commission proposes amendments to sec. s805.160-805. 165, 
concerning rules to implement the Job Training Partnership Act (JTPA), pursuant 
to Texas Labor Code, sec.301.061(a) which authorizes the Texas Workforce 
Commission to adopt rules to administer the Workforce and Economic 
Competitiveness Act (Title 10, Chapter 2308, Government Code), and Texas Labor 
Code, sec.302.002(d) which authorizes the Texas Workforce Commission to adopt 
rules necessary for the administration of the Division of Workforce Development. 
 Sections 805.160-805.165 define and prescribe the performance measures by which 
JTPA programs shall be evaluated by the Commission. 
 The revised sections are proposed to replace references to the Texas Department 
of Commerce with references to the Texas Workforce Commission, which pursuant to 
Texas Government Code, sec.301.063(a)(2) is the state administrative entity for 
the JTPA; to remove references to a state JTPA which was repealed by Acts 1995, 
74th Legislature, Chapter 655; and to delete definitions of performance 
standards because the terms are no longer used in the rules. Section 805.161 
(relating to Variations to DOL Performance Standards) is amended to provide 
general references to state and federal performance standards and to remove 
references to specific program years and criteria for performance standards. 
Section 805.163 (relating to Incentive Grants for Exceeding DOL Performance 
Standards) is amended to remove specific criteria for incentive awards and only 
refer to published federal and state requirements. 
 Fabian Gomez, JTPA Attorney, Texas Workforce Commission, has determined that 
for the first five-year period the sections are in effect there will be no 
fiscal implications for state or local government as a result of enforcing or 
administering the sections. 
 Mr. Gomez also has determined that for each year of the first five years the 
proposed sections are in effect, the public benefits anticipated as a result of 
enforcing the sections will be to facilitate the development and implementation 
of effective state and local systems for managing job training, employment and 
related programs in this state. There will be no effect on small businesses. 
There is no anticipated economic cost to persons who are required to comply with 
the sections as proposed. 
 Written comments on the proposed rules may be submitted to Margo Kaiser, JTPA 
Attorney, Texas Workforce Commission, 211 East 7th Street, Suite 1000, Austin, 
Texas 78701, within 30 days of the publication of the proposed sections. 
 The amendments are proposed under the Texas Labor Code,  s301.061(a), which 
authorizes the Texas Workforce Commission to adopt rules to administer the 
Workforce and Economic Competitiveness Act (Title 10, Chapter 2308, Government 
Code), and Texas Labor Code, sec.302.002(d), which authorizes the Texas 
Workforce Commission to adopt rules necessary for the administration of the 
Division of Workforce Development; and pursuant to the Administrative Procedure 
Act, Texas Government Code, Chapter 2001, Subchapter B, which mandates the 
rulemaking procedures for state agencies. 
 The following statutes are affected by the proposed sec. s805.160-805.165: 
Texas Labor Code, sec.301.063(a)(2) Texas Government Code, sec.sec.2308.204, 
2308. 303(a)(6) and 2308.304(a)(1). 
 
 
  sec.805.160. Definitions.  For purposes of implementing this subchapter, in 
addition to the definitions and references in sec.805.102 of this title 
(relating to General Definitions), the following words and terms, when used in 
this subchapter shall have the indicated meanings, unless the context clearly 
indicates otherwise. 
   
   [Adjusted standard -The national departure point for a performance standard 
adjusted by the net effects of local service delivery area factors on predicted 
performance. 
   
   [Departure point -A national performance standard prior to adjustments for 
local factors. 
   
   [Extreme values -Extremely low or extremely high local factors affecting 
performance measures. 
   
   [Lower confidence interval-The adjusted standard minus the greater of the 
tolerance range or expanded tolerance range for the standards on which a service 
delivery area has extreme values.] 
   
   [Tolerance range -A numerical value providing a high and low range of 
adjustment for extreme values. An "expanded tolerance range" is an optional 
wider range of high and low adjustment values for service delivery areas with 
extreme values on two or more local factors.] 
 
   
  sec.805.161. Variations to DOL Performance Standards. 
 
  (a) Pursuant to <nl>the<ol> [Federal] Act sec.106(d)(1), the state prescribes 
[for program years 1994-1995] the following variations in the performance 
standards established by the Department of Labor (DOL) for Title IIA, IIC, and 
III JTPA programs. Each service delivery area (SDA) and substate area (SSA) must 
meet the performance standards established by DOL, with the state variations 
prescribed by the governor, for Title IIA, IIC and III JTPA programs. DOL 
performance standards and the state variations shall be published in the  Texas 
Register. 
   
  (b) A reorganization plan will be imposed on any SDA/SSA which<nl>, by the U. 
S. Secretary of Labor's definition,<ol> fails to meet [any three DOL] 
performance standards <nl>established for Title IIA and Title IIC programs,<ol> 
or  <nl>the DOL Title III performance standard<ol> [both DOL youth standards] 
for two consecutive years pursuant to the technical assistance and 
reorganization procedures set forth in sec.sec.805.183-805.187 of Subchapter E 
of this chapter (relating to State Monitoring and Sanctions Policies). 
 
     
  sec.805.162. State Performance Standards. Pursuant to <nl>the<ol> [Federal] 
Act sec.106(e), SDAs and SSAs must meet the state performance standards for the 
Title IIA, IIC, and III JTPA programs, which shall be published in the Texas 
Register. 
 
   
  sec.805.163. Incentive Grants for Exceeding DOL Performance Standards. 
 
  (a) Incentive grants will be awarded only to eligible SDAs that exceed 
established standards for Title IIA and IIC programs. To be eligible for 
consideration an SDA must [meet all of the following criteria]: 
 
  (1)  <nl>meet<ol> [meets] <nl>all performance criteria for incentive awards 
established by DOL; and<ol> [at least four of the following DOL standards,] 
 
  [(A) adult follow-up employment rate, 
   
  [(B) adult follow-up weekly earnings, 
   
  [(C) adult welfare follow-up employment rate, 
   
  [(D) adult welfare follow-up weekly earnings, 
   
  [(E) youth entered employment rate, and 
   
  [(F) youth employability enhancement rate; 
     
  [(2) meets at least one of the DOL youth standards; 
   
  [(3) meets the requirement that at least 65% of the SDA's Title IIA 
participants be hard-to-serve; 
   
  [(4) meets the requirement that at least 65% of the SDA's Title IIC 
participants be hard-to-serve;] 
   
  <nl>(2)<ol>[(5)] <nl>exceed <ol> [exceeds] at least one of the federally 
required or state established performance measures published by the 
<nl>Commission<ol> [department] in the Texas Register. 
     
  (b)-(c) (No change.) 
 
     
  sec.805.164. Incentive Grants for Exceeding State Standards.  Subject to the 
availability of funds, SDA's eligible for an incentive award under 
sec.805.<nl>163 <ol> [162] of this title (relating to Incentive Grants for 
Exceeding DOL Performance Standards) will be awarded incentive grants for Title 
IIA and IIC state performance standards, subject to the provision that the total 
incentive grants distributed pursuant to this section shall not exceed 25% of 
the total funds distributed as incentive grants. 
 
   
  sec.805.165. Distribution of any Remaining Incentive Funds. <ol> If the total 
of incentive grants [and bonus incentive grants] is less than the total amount 
allocated for incentive awards, the balance will be prorated by award share and 
shall be provided as additional incentive grant funds to those SDAs eligible for 
an incentive award. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be a valid exercise of the agency's authority. 
 Issued in Austin, Texas, on April 25, 1996. 
 TRD-9605756 
  Carol Kingsbery Otto 
 Attorney, Intergovernmental Relations 
 Texas Workforce Commission 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 463-7833 
         
           
  Subchapter E. State Monitoring and Sanctions Policies 
 
  40 TAC sec.sec.805.170-805.174, 805.176, 805.179-806.188, 805. 191, 805.193-
805.195 
 
  The Texas Workforce Commission proposes amendments sec. s805.170-805.174, 
805.176, 805.179-806.188, 805.191, and 805.193-805.195, concerning rules to 
implement the Job Training Partnership Act (JTPA), pursuant to Texas Labor Code, 
sec.301.061(a) which authorizes the Texas Workforce Commission to adopt rules to 
administer the Workforce and Economic Competitiveness Act (Title 10, Chapter 
2308, Government Code), and Texas Labor Code, sec.302.002(d) which authorizes 
the Texas Workforce Commission to adopt rules necessary for the administration 
of the Division of Workforce Development. 
 The sections establish procedures for a state monitoring plan to identify 
subrecipients with compliance problems and facilitate the provision of timely 
technical assistance or sanctions to address such problems. 
 The revised sections are proposed to replace references to the Texas Department 
of Commerce with references to the Texas Workforce Commission, which pursuant to 
Texas Government Code, sec.301.063(a)(2) is the state administrative entity for 
the JTPA; and to remove references to a state JTPA which was repealed by Acts 
1995, 74th Legislature, Chapter 655. 
 Fabian Gomez, JTPA Attorney, Texas Workforce Commission, has determined that 
for the first five-year period the sections are in effect there will be no 
fiscal implications for state or local government as a result of enforcing or 
administering the sections. 
 Mr. Gomez also has determined that for each year of the first five years the 
proposed sections are in effect, the public benefits anticipated as a result of 
enforcing the sections will be to facilitate the development and implementation 
of effective state and local systems for managing job training, employment and 
related programs in this state. There will be no effect on small businesses. 
There is no anticipated economic cost to persons who are required to comply with 
the sections as proposed. 
 Written comments on the proposed rules may be submitted to Margo Kaiser, JTPA 
Attorney, Texas Workforce Commission, 211 East 7th Street, Suite 1000, Austin, 
Texas 78701, within 30 days of the publication of the proposed sections. 
 The amendments are proposed under the Texas Labor Code,  s301.061(a), which 
authorizes the Texas Workforce Commission to adopt rules to administer the 
Workforce and Economic Competitiveness Act (Title 10, Chapter 2308, Government 
Code), and Texas Labor Code, sec.302.002(d), which authorizes the Texas 
Workforce Commission to adopt rules necessary for the administration of the 
Division of Workforce Development; and pursuant to the Administrative Procedure 
Act, Texas Government Code, Chapter 2001, Subchapter B, which mandates the 
rulemaking procedures for state agencies. 
 The following statutes are affected by the proposed sec. s805.170-805.196: 
Texas Labor Code, sec.301.063(a)(2) Texas Government Code, sec.sec.2308.204, 
2308. 303(a)(6) and 2308.304(a)(1). 
 
 
  sec.805.170. Purpose and Authority. This subchapter establishes procedures for 
a State Monitoring Plan, under the authority of <nl>the <ol> [Federal] Act 
sec.164(a) as specified in 20 CFR sec.627.475, to facilitate the identification 
of subrecipients with compliance problems and to timely address such problems 
through technical assistance or sanctions. 
 
   
  sec.805.171. Definitions.  For purposes of implementing this subchapter, in 
addition to the definitions and references in sec.805.102 of this title 
(relating to General Definitions), the following words and terms when used in 
this subchapter shall have the following meanings, unless the context clearly 
indicates otherwise: 
   
   Problem Findings-The significant issues contained in a monitoring report 
issued by the <nl>Commission<ol> [department] that identify non-compliance with 
JTPA policy, subrecipient job training plans, or contractual requirements. 
 
   
  sec.805.172. State Monitoring. 
 
  (a) Each SDA/SSA shall be monitored annually by the  <nl>Commission<ol> 
[department] to assess the subrecipient's administrative, fiscal, contractual 
and program activities. State monitoring includes the following: 
 
  (1) evaluation of SDA/SSA policies for program quality and outcomes to ensure 
compliance with the objectives of the [Federal] Act and its regulations; 
   
  (2) (No change.) 
   
  (3) evaluation of job training plans to ensure they meet the criteria 
contained in <nl>the<ol> [Federal] Act sec.105(b)(1); and 
   
  (4) examination of SDA/SSA expenditures against the cost categories and cost 
limitations specified in the [Federal] Act and its regulations. 
     
  (b) (No change.) 
 
     
  sec.805.173. The Monitoring Report. The <nl>Commission <ol> [department] will 
prepare a monitoring report which shall describe any possible violations 
discovered during a monitoring review and detail the required corrective action 
to be taken by the subrecipient to correct an alleged violation. 
 
   
  sec.805.174. Responses to Monitoring Reports 
 
  (a) The SDA/SSA shall provide the <nl>Commission <ol> [department] with an 
initial response to the problems or findings in a monitoring report within 30 
calendar days from the SDA/SSA's receipt of the report. If the SDA/SSA's 
response proposes acceptable corrective action and no further verification is 
required, the <nl>Commission<ol> [department] will issue a letter closing the 
report. If the response is unacceptable, or verification is inadequate, the 
SDA/SSA shall be required to perform additional corrective actions or provide 
additional documentation. The <nl>Commission<ol> [department] may also conduct 
an on-site monitoring visit during this phase. 
   
  (b) Follow-up responses from the SDA/SSA shall be due every 15 days after the 
initial response until all findings have been resolved. The SDA/SSA shall 
provide additional information to be considered concerning the violation and 
indicate the proposed corrective action and the time line for completion of the 
corrective action. 
   
  (c) If the SDA/SSA does not fully resolve all problems or findings within 180 
days after the receipt of the monitoring report, sanctions shall be imposed, as 
provided in sec.sec.805.180- <nl>805.187<ol> [805.188] of this title (relating 
to State Sanctions Policy and Procedures). 
 
     
  sec.805.176. Subrecipient Roles and Responsibilities. 
 
  (a)-(d) (No change.) 
   
  (e) The monitoring reports shall identify problems of noncompliance with JTPA 
laws and regulations and provide recommendation for corrective action and 
guidance to enhance program quality. The SDA/SSA monitoring staff shall consult 
with appropriate resource persons or <nl>Commission<ol> [department] staff to 
analyze their compliance problems and develop appropriate recommendations. 
 
     
  sec.805.179. State Sanctions Policy and Procedures.  The <nl>Commission<ol> 
[department] may impose sanctions or penalties on subrecipients that are not in 
compliance with JTPA statutes, regulations or rules. Examples of noncompliance 
include the following: 
 
  (1) (No change.) 
   
  (2) failure to respond to audit resolution issues within the time specified in 
sec..195 of this title (relating to  <nl>Failure to Submit Audit <ol> [Routine 
Audit Resolution Time Sequence]); 
   
  (3) (No change.) 
   
  (4) failure to meet performance standards or take required corrective action 
pursuant to a technical assistance plan developed under sec.<nl>805. 
185<ol>[805.186] of this title (relating to Technical Assistance Plan). 
 
     
  sec.805.180. Sanctions Procedures. 
 
  (a) The <nl>Commission's<ol> [department's] executive director shall send a 
notice of pending sanctions to the SDA/SSA, the PIC chair, and the Chief Elected 
Official, indicating the violation, the corrective action to be taken, the 
impending sanction, and the process by which the SDA/SSA may appeal the 
sanction. 
   
  (b) The deliberateness, gravity and frequency of the violation shall determine 
the type and degree of sanctions which may include the following: 
 
  (1)-(3) (No change.) 
   
  (4) such changes as deemed necessary by the <nl>Commission <ol> [department] 
to secure compliance. 
 
       
  sec.805.181. Repeated Problems or Findings. 
 
  (a) (No change.) 
   
  (b) The <nl>Commission's<ol> [department's] executive director shall consider 
imposing sanctions if it is determined that a continued violation by an SDA/SSA 
constitutes willful disregard of these rules, gross negligence, or failure to 
observe accepted standards of administration, and is of significant impact to 
program quality or outcomes. The <nl>Commission's<ol> [department's] executive 
director may request the State Council to recommend to the governor a revocation 
of all or part of the SDA/SSA's job training plan. 
 
     
  sec.805.182. Imposition of Sanctions. 
 
  (a) If an SDA/SSA does not provide the <nl>Commission <ol> [department] with 
evidence of implementation of required corrective action within ten days of the 
SDA/SSA's receipt of a notice of impending sanctions, the  <nl>Commission's<ol> 
[department's] executive director shall notify the SDA/SSA, the PIC Chair, and 
the Chief Elected Official that an appropriate sanction is being imposed upon 
the SDA/SSA until such time that necessary action is taken to correct the 
violation. 
   
  (b) If the initial sanction imposed is insufficient to correct the violation, 
the <nl>Commission's<ol> [department's] executive director will recommend to the 
governor the issuance of a notice of intent to revoke all or part of the 
SDA/SSA's job training plan and/or contract, subject to the provisions for 
appeal in <nl>the<ol> [Federal] Act sec.164(b)(2)(A). 
   
  (c) The <nl>Commission's<ol> [department's] executive director will postpone 
sanctions if satisfactory evidence is received of the initiation of required 
corrective action within 10 days of the SDA/SSA's receipt of the notice of 
impending sanctions. The postponement shall continue until corrective action by 
the SDA/SSA has been completed and verified. The <nl>Commission's<ol> 
[department's] executive director shall implement sanctions if such corrective 
action is not completed or remains unverified. 
 
     
  sec.805.183. Technical Assistance and Reorganization. Pursuant to <nl>the<ol> 
[Federal] Act sec.106(j)(2) the  <nl>Commission<ol> [department] has developed 
the procedures described in sec.sec.805.185-<nl>805.186 <ol> [805. 188] of this 
title (relating to Technical Assistance and Reorganization) to implement 
policies for providing technical assistance to any SDA/SSA which does not meet 
performance standards under the criteria established in Subchapter D of this 
chapter (relating to Performance Standards). 
 
   
  sec.805.184. Failure to Meet Performance Standards.  If a monitoring report or 
the performance report generated by the <nl>Client Management System 
(CMS)<ol>[Management Information System (MIS)], or any other periodic report, 
indicates that an SDA/SSA has failed to meet any performance standards, the  
<nl>Commission<ol> [department] will review the subrecipient's JTPA program to 
identify the program factors or conditions contributing to such failure. 
 
   
  sec.805.185. Technical Assistance Plan. 
 
  (a) The SDA/SSA in conjunction with the <nl>Commission <ol> [department] shall 
develop a technical assistance plan which will include the following: 
 
  (1)-(8) (No change.) 
     
  (b) The technical assistance plan shall be executed by the SDA/SSA director, 
the PIC chair, the Chief Elected Official(s) and the <nl>Commission's<ol> 
[department's] executive director, to be effective no later than October 31 
following the issuance of the latest annual <nl>CMS<ol> [MIS] performance report 
on the subject SDA/SSA. 
   
  (c) The subject SDA/SSA shall conduct monthly reviews of the technical 
assistance plan and provide the <nl>Commission <ol> [department] with a written 
report on corrective actions taken. 
 
     
  sec.805.186. SDA/SSA Reorganization Plan due to Consecutive Failure. 
 
  (a) An SDA/SSA which fails to meet particular performance standards for a 
second consecutive program year is subject to reorganization pursuant to 
<nl>the<ol> [Federal] Act sec.106(j)(4). The <nl>Commission<ol> [department] 
shall make such assessment after a comprehensive review of an SDA/SSA's JTPA 
programs, including a review of the following: 
 
  (1)-(4) (No change.) 
     
  (b) Based on the comprehensive review outlined in subsection (a) of this 
section, the <nl>Commission<ol> [department] shall develop, and recommend to the 
State Council for final recommendation to the governor, an SDA/SSA 
reorganization plan which will detail specific actions to be taken by the 
SDA/SSA to strengthen its administration and improve its program performance. 
The SDA/SSA reorganization plan will incorporate elements of the technical 
assistance plan implemented in the previous year, including an assessment of the 
reasons for the SDA/SSA's failure to improve performance, and shall prescribe 
the required corrective actions, which may include the elements described in 
<nl>the<ol> [Federal] Act sec.106(j)(4)(B). 
   
  (c) The subject SDA/SSA shall conduct monthly reviews of the reorganization 
plan and provide the <nl>Commission <ol> [department] with a written report on 
corrective actions taken. 
   
  (d) An SDA/SSA that is subject to a reorganization plan may appeal to the 
Secretary of Labor to rescind or revise such plan under the provisions of 
<nl>the<ol> [Federal]Act sec.106(j)(6) and 20 CFR sec.627.471. 
 
     
  sec.805.187. Sanctions for Continued Violations. The <nl>Commission's<ol> 
[department's] executive director shall impose the sanction procedures provided 
for in sec.sec.<nl>805.179 <ol>-[805.180] 805.183 of this title (relating to 
State Sanctions Policy and Procedures) if it is determined that continued 
failure by an SDA/SSA to meet performance standards or take required corrective 
action constitutes evidence of willful disregard of the technical assistance 
plan or the <nl>Act<ol> [State and Federal JTPA Acts]. 
 
   
  sec.805.188. Subrecipient Annual Audit Requirement. 
 
  (a) (No change.) 
   
  (b) Such audits shall be conducted pursuant to the compliance standards and 
references for non-federal audits prescribed in 20 CFR sec.627.480(a) for the 
subrecipient categories of governments, non-governmental subrecipients, and 
commercial organizations which are subrecipients and receive $25,000 or more a 
year in federal funds to operate a JTPA program. The subrecipient shall provide 
the <nl>Commission<ol> [department] with a copy of the audit report within 180 
days from the end of the JTPA fiscal year. 
 
     
  sec.805.191. Contents of Audit Report. 
 
  (a) The independent audit report submitted to the  <nl>Commission<ol> 
[department] should be guided by the rules in this subchapter and the following 
laws or publications: 
 
  (1)-(4) (No change.) 
     
  (b) (No change.) 
 
     
  sec.805.193. Audit Submissions. 
 
  (a) Within 180 days after the close of a subrecipient's fiscal year, the 
subrecipient shall forward to the Audit Resolution Section of the 
Texas<nl>Workforce Commission <ol> [Department of Commerce] (Audit Section), an 
audit report completed in accordance with 20 CFR sec.627.480 and sec.sec.805. 
189-805.193 of this title (relating to Subrecipient Audit Responsibility). 
   
  (b)-(c) (No change.) 
 
     
  sec.805.194. Informal Resolution Process. 
 
  (a) After review of the audit by the <nl>Commission <ol> [department], the  
<nl>Commission<ol> [department] will issue an Initial Determination Letter to 
the subrecipient offering the opportunity to informally resolve issues not 
resolved during the routine audit resolution process. The subrecipient may 
submit additional documentation or meet with officials of the <nl>Commission 
<ol> [department] to discuss the allowability of any remaining questioned costs. 
The Initial Determination Letter will also include administrative findings that 
remain unresolved as well as sanctions that the <nl>Commission<ol> [department] 
may impose if a resolution is not timely reached. 
   
  (b) The <nl>Commission<ol> [department] shall issue a Final Determination 
Letter detailing the remaining issues if problem findings are not completely 
resolved during the Informal Resolution Process. If these issues include 
questioned costs, and there is no additional information to support the costs, 
the costs will be disallowed and a debt by the subrecipient shall be established 
by the <nl>Commission<ol> [department]. 
 
     
  sec.805.195. Failure to Submit Audit. The  <nl>Commission<ol> [department] 
shall issue a delinquent notice to a subrecipient if an audit is not received 
within 180 days from the end of the subrecipient's fiscal year. If no response 
is received within 15 days from the delinquent notice date, the <nl>Commission 
<ol> [department] shall issue a certified letter providing the subrecipient with 
a final 15-day period to respond. If no response is received to either notice, 
the executive director of the <nl>Commission<ol> [department] may withhold funds 
on any of the subrecipient's current contracts pending receipt of the audit 
report, or may issue other sanctions as provided in sec.805.180 of this title 
(relating to Sanctions Procedures). 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be a valid exercise of the agency's authority. 
 Issued in Austin, Texas, on April 25, 1996. 
 TRD-9605757 
  Carol Kingsbery Otto 
 Attorney, Intergovernmental Relations 
 Texas Workforce Commission 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 463-7833 
         
           
  Subchapter F. Financial Management Rules 
 
  40 TAC sec.sec.805.200, 805.202, 805.205-805.208, 805.210, 805. 212, 805.218, 
805.223-805.231 
 
  The Texas Workforce Commission proposes amendments to sec. s805.200, 805. 202, 
805.205-805.208, 805.210, 805.212, 805.218, and 805.223-805.231 concerning rules 
to implement the Job Training Partnership Act (JTPA), pursuant to Texas Labor 
Code, sec.301.061(a) which authorizes the Texas Workforce Commission to adopt 
rules to administer the Workforce and Economic Competitiveness Act (Title 10, 
Chapter 2308, Government Code), and Texas Labor Code, sec.302.002(d) which 
authorizes the Texas Workforce Commission to adopt rules necessary for the 
administration of the Division of Workforce Development. 
 The sections establish uniform accounting and financial management rules for 
the administration of all JTPA programs funded through the Texas Workforce 
Commission. 
 The revised sections are proposed to replace references to the Texas Department 
of Commerce with references to the Texas Workforce Commission, which pursuant to 
Texas Government Code, sec.301.063(a)(2) is the state administrative entity for 
the JTPA and to remove references to a state JTPA which was repealed by Acts 
1995, 74th Legislature, Chapter 655. 
 Fabian Gomez, JTPA Attorney, Texas Workforce Commission, has determined that 
for the first five-year period the sections are in effect there will be no 
fiscal implications for state or local government as a result of enforcing or 
administering the sections. 
 Mr. Gomez also has determined that for each year of the first five years the 
proposed sections are in effect, the public benefits anticipated as a result of 
enforcing the sections will be to facilitate the development and implementation 
of effective state and local systems for managing job training, employment and 
related programs in this state. There will be no effect on small businesses. 
There is no anticipated economic cost to persons who are required to comply with 
the sections as proposed. 
 Written comments on the proposed rules may be submitted to Margo Kaiser, JTPA 
Attorney, Texas Workforce Commission, 211 East Seventh Street, Suite 1000, 
Austin, Texas 78701, within 30 days of the publication of the proposed sections. 
 The amendments are proposed under the Texas Labor Code,  s301.061(a), which 
authorizes the Texas Workforce Commission to adopt rules to administer the 
Workforce and Economic Competitiveness Act (Title 10, Chapter 2308, Government 
Code), and Texas Labor Code, sec.302.002(d), which authorizes the Texas 
Workforce Commission to adopt rules necessary for the administration of the 
Division of Workforce Development; and pursuant to the Administrative Procedure 
Act, Texas Government Code, Chapter 2001, Subchapter B, which mandates the 
rulemaking procedures for state agencies. 
 The following statutes are affected by the proposed sections Texas Labor Code, 
sec.301.063(a)(2) Texas Government Code, sec.sec.2308.204, 2308.303(a)(6) and 
2308.304(a)(1). 
 
 
  sec.805.200. Purpose and Authority. This subchapter establishes uniform 
accounting and financial management rules for the administration of all JTPA 
programs funded through the Texas<nl>Workforce Commission<ol> [Department of 
Commerce]. The rules apply to the procurement of all goods and services to be 
purchased with JTPA funds, establish property management standards for 
subrecipients and their subcontractors, and supplement the procedures 
established by <nl>the<ol> [Federal] Act sec.164 and sec.165 and Federal 
Regulations 20 CFR, Part 627, Subpart D (relating to Administrative Standards). 
 
   
  sec.805.202. Subrecipient Bonding. <ol> Before being authorized for funding, 
subrecipients shall provide the <nl>Commission <ol> [department] with a fidelity 
bond covering every officer, director or employee authorized to represent the 
subrecipient for the purpose of receiving or depositing JTPA funds, or issuing 
financial documents, checks or other instruments of payment. The subrecipient 
shall be the insured and the  <nl>Commission<ol> [department] shall be the 
beneficiary. The bond coverage amount shall be the combined highest aggregate 
sum of daily advances for all programs. The subrecipient shall immediately 
notify the <nl>Commission <ol> [department] if a bond is canceled or reduced and 
no further disbursements shall be made to the subrecipient until adequate 
coverage has been obtained. 
 
   
  sec.805.205. Insurance Requirements. 
 
  (a) Participant Insurance. Pursuant to <nl>the <ol> [Federal] Act 
sec.143(a)(3), subrecipients should ensure that any JTPA participants who do not 
qualify as "employees" are covered by on-site medical and accident insurance. 
Subrecipients should also contractually ensure that employers accept the 
liability for injuries while JTPA participants are at a work site. 
   
  (b) General Liability Insurance. Each subrecipient location shall be covered 
by general liability insurance for personal injury and bodily injury and 
property damage to a third party, in the amount of $500,000 for each occurrence 
or one million dollars aggregate. The <nl>Commission<ol> [department] may waive 
such insurance requirement based upon demonstrated cost/benefit impracticality. 
A reasonable deductible is allowed unless a waiver is obtained from the 
<nl>Commission<ol> [department]. 
   
  (c) Automobile Insurance. 
 
  (1) (No change.) 
   
  (2) Subrecipients shall maintain all certificates or policies of insurance and 
shall be responsible for payment of premiums or assessments on such policies. If 
a subrecipient that possesses 25 or more JTPA owned vehicles is eligible for and 
arranges for self-insurance, a copy of the certificate provided by the Texas 
Department of Public Safety must be submitted to the <nl>Commission<ol> 
[department]. 
     
  (d) (No change.) 
 
     
  sec.805.206. Refund Policy. 
 
  (a) Amounts paid back to the <nl>Commission <ol> [department] due to a 
reduction in expenses or a legitimate accrual that did not materialize must be 
fully documented and are subject to verification by monitors. 
   
  (b) The subrecipient should adjust total expenditures by the amount of a 
refund before the closeout information is submitted to the <nl>Commission<ol> 
[department]. If closeout information has already been submitted, but the 
recipient receives a refund before the final closeout deadline, a revised final 
closeout statement shall be mailed to Texas  <nl>Workforce Commission<ol> 
[Department of Commerce], Accounting Section, <nl>101 East 15th Street <ol> 
[P.O. Box 12728], Austin, Texas <nl>78778-0001 <ol> [78711-2728]. The refund 
check, showing the contract number, shall be mailed to Texas <nl>Workforce 
Commission<ol> [Department of Commerce], Administration Division/Cashier, 
<nl>101 East 15th Street <ol> [P.O. Box 12728], Austin, Texas <nl>78778-0001 
<ol> [78711-2728]. 
   
  (c) If closeout information has already been submitted, and the recipient 
receives a refund after the final closeout deadline, the refund check shall be 
mailed to the <nl>Commission's <ol> [department's] Administration Division's 
cashier and appropriate documentation should be mailed to the Texas 
<nl>Workforce Commission<ol> [Department of Commerce], [Work Force Development 
Division,] Fiscal Management Services, <nl>101 East 15th Street <ol> [P.O. Box 
12728], Austin, Texas <nl>78778-0001 <ol> [78711-2728]. 
   
  (d) If a subrecipient has a consistent policy of showing as expenses any 
actual payments to or on behalf of employees or former employees for 
unemployment compensation or workers' compensation, such payments are allowable 
in the year of payment. Unclaimed wages, payments to trainees and participant 
support payments that remain unpaid after the program closeout shall be refunded 
to the <nl>Commission<ol> [department]. 
 
     
  sec.805.207. Allowable and Unallowable Costs. Pursuant to Federal Regulations 
20 CFR 627.435(I), the following guidelines shall be used for calculating a 
subrecipient's allowable and unallowable costs among the listed cost items. 
 
  (1)-(3) (No change.) 
   
  (4) Depreciation or use allowances. Compensation for the use of buildings, 
capital improvements, equipments and other capital assets purchased with non 
JTPA funds may be made through depreciation or use allowances. 
 
  (A) The basis, or value for depreciation purposes, shall be the acquisition 
cost of the equipment. The acquisition cost of the equipment shall not include 
interest or any other charges that do not impact the cost of the asset. 
Shipping, installation, set-up fees and other costs necessary to get the asset 
"up and running" may be added to the basis of the asset for JTPA allowable 
depreciation purposes. Capital improvements are material repairs (or 
improvements) that have a useful life greater than one year and have not been 
expended or charged to JTPA. Capital improvements for assets other than 
buildings, shall be capitalized and depreciated separately. The depreciable life 
of these capital improvements shall be determined by the <nl>Commission<ol> 
[department]. 
   
  (B) In the case of buildings, basis shall be acquisition cost plus the cost of 
any capital improvements. Capital improvements to the building in years 
subsequent to the building's original purchase year shall be capitalized and 
depreciated separately. The depreciable life of these capital improvements shall 
be determined by the <nl>Commission<ol> [department] . 
   
  (C) (No change.) 
   
  (D) The <nl>Commission<ol> [department] shall determine the useful lives for 
non-JTPA purchased property depreciation allowances. In determining the useful 
life for JTPA depreciation purposes, start year shall be the earlier of the year 
of purchase or the year in which the asset is used for JTPA. 
   
  (E) (No change.) 
   
  (F) If the useful life of the asset, computed from the date of purchase, has 
expired the only allowable charge to JTPA shall be the use allowance. Use 
allowance rates for buildings, capital improvements, and all other assets shall 
be set by the <nl>Commission<ol> [department]. 
   
  (G) (No change.) 
     
  (5) (No change.) 
   
  (6) Interest expense. A cost allowance for interest expense on competitively 
procured equipment leases may be allowed contingent upon the accuracy and 
validity of the procurement process. Interest expense is allowable on equipment 
leases procured through a sole source if justified by an accurate, clearly 
written lease versus purchase analysis, which is maintained by the Contractor 
and made available to monitors and other representatives of the  
<nl>Commission<ol> [department]. 
   
  (7) Expenditures for travel and transportation. Costs for transportation, 
lodging, subsistence, and related items incurred by employees on official 
business travel are allowable subject to the following: 
 
  (A)-(B) (No change.) 
     
  (8) (No change.) 
   
  (9) Fees or profits. Subcontractor fees and profits are allowable to the 
extent that they are not excessive, according to the complexity of the work 
performed, the risk borne by the contractor, and market conditions in the 
surrounding geographical area, and that they are permitted under the [Federal] 
Act  s164(a)(3)(D) and (I). Under no circumstances shall subcontractor fees, 
profits, or program income exceed 10% of the contract amount. 
   
  (10)-(12) (No change.) 
   
  (13) Pre-agreement costs. Pre-agreement costs are allowable if prior approval 
by the <nl>Commission<ol> [department] is obtained. The <nl>Commission<ol> 
[department] may allow such expenses when the situation requires that costs be 
incurred before the award of a contract. The substate area (SSA) or sub-state 
grantees (SSG) must request such authorization in writing before incurring any 
costs. Preagreement costs are only allowable to the extent that they would have 
been allowable if incurred after the date of the award. Authorization to incur 
expenses is not a guarantee of reimbursement by the state. The state may 
disallow such costs because of Department of Labor limitations, violation of a 
statute or regulation by the SSA or SSG, or for other cause considered 
sufficient by the <nl>Commission <ol> [department] . 
   
  (14)-(16) (No change.) 
 
     
  sec.805.208. Definition of an Obligation. 
 
  (a) An SDA obligation is a debt established by legal contract, letter of 
agreement, subgrant award, or purchase order which has been executed prior to 
the end of a program year, and which will be performed within the program year 
or 90 days after the program year ends. Any obligation periods extending beyond 
90 days after the program year ends shall be prorated using the straight line 
method or other acceptable proration method which accurately matches benefits 
received with dollars included as obligations. Deviations from the straight line 
method must be supported by worksheets and a documented rationale. The  
<nl>Commission<ol> [Department] reserves the right to waive the 90-day 
limitation on obligations. 
   
  (b)-(c) (No change.) 
   
  (d) Any reported obligations and worksheets generated by a proration of an 
obligation shall be subject to review by the <nl>Commission<ol> [department] . 
Deliberate unreasonable misstatement of obligations to meet expenditure 
requirements or cost category compliance shall subject the subrecipient to 
possible sanctions. 
 
     
  sec.805.210. Voluntary Deobligation. <ol> SDAs/SSGs which determine they 
cannot meet the 85% obligation level may request to voluntarily deobligate 
funds. An SDA/SSG request for voluntary deobligation must be received by the  
<nl>Commission<ol> [department] within a reasonable time frame for the funds to 
be reobligated and utilized elsewhere. For Title IIA, IIC, and Title III formula 
funds, the deadline is the end of the third quarter of the applicable JTPA 
program year. The request for voluntary deobligation must be approved by the  
<nl>Commission<ol> [department]. A waiver of the voluntary deobligation deadline 
may be granted by the <nl>Commission <ol> [Department]. 
 
   
  sec.805.212. JTPA Records and Files. Each JTPA contractor must maintain, in a 
central location, a historical file for each procurement providing full 
documentation that accurately tracks the actions leading to the procurement of 
the product or services. All procurement historical files are subject to audit 
and shall be reviewed during on-site monitoring visits by the <nl>Commission 
<ol> [department], the Department of Labor, the Office of Inspector General, the 
Comptroller General of the United States, or any of their authorized 
representatives. All contractors must have procedures for the retention of all 
records pertinent to all grants and agreements, including financial, 
statistical, property, and participant records and supporting documentation. 
 
   
  sec.805.218. Processing of Noncompetitive Procurements. 
 
  (a) The contractor shall obtain prior written approval from the 
<nl>Commission<ol> [department] for any noncompetitive procurement expected to 
exceed $25,000 in the aggregate. 
   
  (b)-(c) (No change.) 
 
     
  sec.805.223. Nonexpendable Personal Property Management. 
 
  (a) Nonexpendable personal property purchased with JTPA funds having a unit 
cost of $500 or more and a life expectancy of one year, including lease/purchase 
equipment on which multi-year payments are being made, is considered JTPA 
accountable property and is subject to the property management provisions 
established in this section. Title to such property remains vested in the 
subrecipient but the <nl>Commission<ol> [department] reserves the right to 
transfer title or issue disposition instructions for property with a unit 
acquisition cost of $5,000 or more. 
   
  (b) Such property shall be considered JTPA accountable property subject to the 
following provisions: 
 
  (1) Subrecipients wishing to purchase equipment with a unit acquisition cost 
of $5,000 or more, including a lease/purchase agreement, must receive prior 
approval from the <nl>Commission <ol> [department] prior to purchase. Prior 
review and approval from the <nl>Commission <ol> [department] is not required 
for property that is only leased. 
   
  (2) If subrecipients acquire replacement equipment they may use the equipment 
to be replaced as a trade-in, or sell the property at fair market value and use 
the proceeds to offset the cost of the replacement property, subject to approval 
by the <nl>Commission<ol> [department]. 
   
  (3) (No change.) 
   
  (4) Subrecipients shall report to the <nl>Commission <ol> [department] all 
acquisitions of property with a unit acquisition cost of $1,000 or more, within 
30 days after acquisition. 
 
       
  sec.805.224. Subrecipient Property Inventory. 
 
  (a) Each subrecipient's property officer shall maintain a current record of 
all JTPA property in its custody and shall promptly notify the 
<nl>Commission<ol> [department] of the possession or acquisition of any JTPA 
nonexpendable personal property with a unit acquisition cost of $1,000 or more 
not previously reported. 
   
  (b) Subrecipients shall conduct an annual physical inventory of JTPA property 
and reconcile the results with their property records. Annual inventory 
documentation shall be subject to review during on-site monitoring by the 
<nl>Commission <ol> [department]. 
 
     
  sec.805.225. Property Maintenance and Security. 
 
  (a) (No change.) 
   
  (b) Subrecipients shall maintain documentation on any JTPA property destroyed, 
including a property description, the date and cause of the destruction. 
Information on destroyed property with a unit acquisition cost of $1,000 or more 
shall be submitted to the <nl>Commission<ol> [department] . 
   
  (c) Subrecipients shall contact the appropriate police department to report 
any missing or stolen JTPA property and must maintain a copy of the policy 
report in the subrecipient's property records. On missing or lost property with 
a unit acquisition cost of $1,000 or more, subrecipients shall submit to the  
<nl>Commission<ol> [department] documentation of the insurance proceeds on the 
loss, a copy of the police report, and the disposition information required in 
sec.805.227(3) of this title (relating to Disposition of Excess Nonexpendable 
JTPA Property). 
 
     
  sec.805.226. Shared Use of JTPA Property. 
 
  (a) (No change.) 
   
  (b) Subrecipients must document the shared use of JTPA activities, property or 
personnel by entering into a shared use agreement with the non-JTPA entity. Such 
agreements shall be subject to review by the <nl>Commission<ol> [department], 
and must: 
 
  (1)-(7) 
     
  (c) Subrecipients must be reimbursed for reasonable cost by the non-JTPA 
entities whenever JTPA property, activities or personnel are used for non-JTPA 
funded programs or activities. Such reimbursement, or user fee, may be in cash 
or in kind. The user fee must be in proportion to the contribution by JTPA to a 
specific project. If the usage of the property, activities or personnel by JTPA 
participants falls below 50%, the <nl>Commission <ol> [department] shall 
determine the type of user fees and method of payment. 
   
  (d) (No change.) 
   
  (e) Subrecipients submitting a Shared Use Schedule form shall be deemed to 
have complied with the reporting requirements of this section. The Shared Use 
Schedule shall be prepared quarterly. The Schedule should be kept on file and 
available for review by monitors, auditors, and other <nl>Commission <ol> 
[Department] representatives. 
 
     
  sec.805.227. Disposition of Excess Nonexpendable JTPA Property.  JTPA 
accountable property no longer needed for JTPA program uses or for other 
federally assisted activities shall be disposed of as follows: 
 
  (1) (No change.) 
   
  (2) Prior to disposing of excess property with a unit acquisition cost of over 
$5,000, subrecipients must provide the <nl>Commission<ol> [department] with a 
written description of the property, including its unit acquisition cost and a 
brief description of the property's condition. The <nl>Commission<ol> 
[department] may then authorize the subrecipient to sell the property for fair 
market value and credit any proceeds to the JTPA program, or may determine an 
alternative use for such property. Subrecipient's submitting a property 
description on the Notification of Excess Property form shall be deemed to have 
complied with the information requirements of this paragraph. 
   
  (3) Within 30 days of any disposition of JTPA property with a unit acquisition 
cost of at least $1,000, subrecipients shall provide the <nl>Commission<ol> 
[department] with a written report of the property disposition procedures, 
including a description of the property, the unit acquisition cost, the 
disposition date, the item's serial number and the funding source. Subrecipients 
submitting a report on the Notification of Property Disposition form shall be 
deemed to have complied with the disposition reporting requirement of this 
paragraph. 
 
     
  sec.805.228. Reporting Requirements. 
 
  (a) Subrecipients must submit to the <nl>Commission <ol> [department], no 
later than the 20th calendar day of each month, monthly reports for each 
contract with the <nl>Commission <ol> [department] to provide financial 
information for budgeting and program management oversight, including the 
following information: 
 
  (1)-(5) (No change.) 
     
  (b)  
 
  <nl>(No change.) 
     
  (c) Subrecipients may obtain cash required to cover immediate needs resulting 
from expenditures under a contract by submitting to the <nl>Commission<ol> 
[department] a request for advance or reimbursement including the following 
information: 
 
  (1)-(4) (No change.) 
     
  (d)-(e) (No change.) 
   
  (f) Subrecipients shall submit to the <nl>Commission <ol> [department] a state 
purchase voucher and a signed statement indicating the contract number and the 
names and signatures of each individual authorized to sign a request for advance 
or reimbursement. Subrecipients submitting an Authorized Signature Designation 
form shall be deemed to have complies with the requirements of this paragraph. 
 
     
  sec.805.229. The Closeout Process. 
 
  (a) (No change.) 
   
  (b) Upon termination or closeout of a contract, subrecipients must submit to 
the <nl>Commission<ol> [department] a written contract release agreement on a 
form provided by the <nl>Commission<ol> [department], and other applicable 
information described in this section. Subrecipients utilizing the Contract 
Release Agreement form shall be deemed to have complied with the requirements of 
this paragraph. 
   
  (c) (No change.) 
   
  (d) When a contract terminates, the total cash received from the 
<nl>Commission<ol> [department] should equal the total cash disbursed and 
reported as expenditures. Any outstanding claims must be reported and included 
in the expenditure reports. Any JTPA cash on hand for claims exceeding reported 
expenditures or not immediately due and payable shall be returned to the 
<nl>Commission<ol> [department] by the subrecipient to the Texas <nl>Workforce 
Commission [Department of Commerce], Administration Division-Cashier,101 East 
15th Street<ol> [P. O. Box 12964], Austin, Texas <nl>78778-0001<ol> [78711-
2964]. Subrecipients submitting either the Unclaimed Wages form or the Schedule 
of Unpaid Liabilities and Other Claims Outstanding form shall be deemed to have 
complied with the additional information requirements of this paragraph. 
   
  (e) Subrecipients shall also include the following reports on nonexpendable 
property purchased with JTPA funds if such reports have not been previously 
provided to the <nl>Commission <ol> [department] during the program year: 
 
  (1)-(3) (No change.) 
 
       
  sec.805.230. Resolution of Questioned Costs. 
 
  (a) Problem findings and questioned costs arising from an annual monitoring 
review of a subrecipient by the <nl>Commission <ol> [Department] , or 
<nl>Department of Labor (DOL)<ol>[ Labor Department], or the subrecipient's 
annual independent audit, or Office of Inspector General (OIG) audit, shall be 
investigated and resolved according to the procedures and audit resolution 
process established by Subchapter E. State Monitoring and Sanctions Policies. 
   
  (b) Subrecipients proposing to use stand-in costs as a substitute for 
otherwise unallowable costs shall include the proposal in the information 
provided to the <nl>Commission <ol> [department] during the informal resolution 
period and, if accepted by the  <nl>Commission<ol> [department], shall be 
subject to final DOL review and approval. 
 
     
  sec.805.231. Subrecipient Time Limitations. If problem findings of questioned 
costs are investigated by DOL or the Office of the Inspector General of the U.S. 
<nl>DOL<ol> [Department of Labor] (OIG), pursuant to Federal Regulations  
s627.481, a subrecipient shall submit its audit resolution report to the 
<nl>Commission <ol> [department] within 90 days from the date of the 
subrecipient's receipt of the DOL audit report. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be a valid exercise of the agency's authority. 
 Issued in Austin, Texas, on April 25, 1996. 
 TRD-9605758 
  Carol Kingsbery Otto 
 Attorney, Intergovernmental Relations 
 Texas Workforce Commission 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 463-7833 
         
           
  Subchapter H. Nondiscrimination and Equal Opportunity 
 
  40 TAC sec.sec.805.260-805.269 
 
  The Texas Workforce Commission proposes amendments sec. s805.260-805.269, 
concerning rules to implement the Job Training Partnership Act (JTPA), pursuant 
to Texas Labor Code, sec.301.061(a) which authorizes the Texas Workforce 
Commission to adopt rules to administer the Workforce and Economic 
Competitiveness Act (Title 10, Chapter 2308, Government Code), and Texas Labor 
Code, sec.302.002(d) which authorizes the Texas Workforce Commission to adopt 
rules necessary for the administration of the Division of Workforce Development. 
 Sections 805.260-805.269 implement state and local methods of administration to 
ensure compliance with the nondiscrimination and equal opportunity provisions of 
the JTPA. 
 The revised sections are proposed to replace references to the Texas Department 
of Commerce with references to the Texas Workforce Commission, which pursuant to 
Texas Government Code, sec.301.063(a)(2) is the state administrative entity for 
the JTPA and to remove references to a state JTPA which was repealed by Acts 
1995, 74th Legislature, Chapter 655. 
 Fabian Gomez, JTPA Attorney, Texas Workforce Commission, has determined that 
for the first five-year period the sections are in effect there will be no 
fiscal implications for state or local government as a result of enforcing or 
administering the sections. 
 Mr. Gomez also has determined that for each year of the first five years the 
proposed sections are in effect, the public benefits anticipated as a result of 
enforcing the sections will be to facilitate the development and implementation 
of effective state and local systems for managing job training, employment and 
related programs in this state. There will be no effect on small businesses. 
There is no anticipated economic cost to persons who are required to comply with 
the sections as proposed. 
 Written comments on the proposed rules may be submitted to Margo Kaiser, JTPA 
Attorney, Texas Workforce Commission, 211 East Seventh Street, Suite 1000, 
Austin, Texas 78701, within 30 days of the publication of the proposed sections. 
 The amendments are proposed under the Texas Labor Code,  s301.061(a), which 
authorizes the Texas Workforce Commission to adopt rules to administer the 
Workforce and Economic Competitiveness Act (Title 10, Chapter 2308, Government 
Code), and Texas Labor Code, sec.302.002(d), which authorizes the Texas 
Workforce Commission to adopt rules necessary for the administration of the 
Division of Workforce Development; and pursuant to the Administrative Procedure 
Act, Texas Government Code, Chapter 2001, Subchapter B, which mandates the 
rulemaking procedures for state agencies. 
 The following statutes are affected by the proposed sec. s805.260-805.269: 
Texas Labor Code, sec.301.063(a)(2) Texas Government Code, sec.sec.2308.204, 
2308. 303(a)(6) and 2308.304(a)(1). 
 
 
  sec.805.260. State Equal Opportunity Officer. 
 
  (a) The Texas <nl>Workforce Commission <ol> [Department of Commerce] 
designates the position of Equal Opportunity Officer, [within the Work Force 
Development Division,] as the person responsible for administering and enforcing 
the provisions of <nl>the<ol> [Federal] Act sec.144 and sec.167, and for 
developing and maintaining the JTPA Equal Opportunity Methods of Administration 
Manual pursuant to 29 CFR Part 34. 
   
  (b) Pursuant to the authority in 29 CFR sec.sec.34.33, 34.42(a) and 34. 43(b), 
the <nl>Commission's<ol> [department's] Equal Opportunity Officer is hereby 
designated as the person responsible for receiving, investigating and resolving 
any complaint alleging a violation of the nondiscrimination and equal 
opportunity provisions of <nl>the<ol> [Federal] Act, sec.167 or 29 CFR Part 34. 
   
  (c) Additionally, the <nl>Commission's<ol> [department's] Equal Opportunity 
Officer (EO Officer) shall conduct compliance reviews and complaint 
investigations and, in order to correct violations, shall negotiate conciliation 
agreements, suggest remedies, and initiate enforcement action. 
   
  (d) The office of the Equal Opportunity Officer shall also provide training 
and technical assistance for subrecipient EO Officers and staff, to ensure 
compliance with nondiscrimination provisions applicable to recipients of federal 
financial assistance. 
   
  (e) The <nl>Commission's<ol> [department's] EO Officer is also designated as 
the Americans With Disabilities Act Coordinator. All correspondence on these 
matters should be addressed to, Texas <nl>Workforce Commission, <ol> [Department 
of Commerce,] Equal Opportunity Officer,  <nl>101 East 15th Street, <ol> [P.O. 
Box 12728] Austin, Texas <nl>78778-0001 <ol> [78711-2728]. 
 
     
  sec.805.261. SDA/SSA Equal Opportunity Officers. 
 
  (a) Each SDA/SSA must designate a person, other than the SDA/SSA director, as 
the EO Officer responsible for coordinating compliance with all 
nondiscrimination provisions of the [Federal] Act, 29 CFR Part 34, Subchapter I 
of this title (relating to JTPA Grievance Procedures), and this subchapter. The 
local EO Officer shall report directly to the SDA/SSA's highest level official, 
and shall perform the following minimum functions: 
 
  (1)-(5) (No change.) 
     
  (b) (No change.) 
 
     
  sec.805.262. Notice of Equal Opportunity. 
 
  (a) Each SDA/SSA must document that it has provided initial and continuing 
notice of the "Equal Opportunity is the Law" notice promulgated by 29 CFR 
34.23(b) to all applicants, participants, and employees by providing them with a 
copy of the <nl>Commission's <ol> [department's] Orientation to Complaint 
Procedure form as prescribed by sec.805.285 of this title (relating to 
Orientation to Complaint Procedure). The SDA/SSA must obtain a signed copy of 
such form to be retained in the official file for each applicant, participant 
and employee. 
   
  (b) (No change.) 
   
  (c) Each SDA/SSA must ensure compliance with and dissemination of the 
requirements of 29 CFR Part 34 by providing training to its staff and to the 
staff of its contractors regarding the nondiscrimination and equal opportunity 
provisions of the [Federal] Act. 
 
     
  sec.805.263. Accessibility Standards. <ol> Pursuant to 29 CFR 32.28, each 
facility used by a recipient for JTPA activities shall be designed, constructed 
or altered to be readily accessible and usable by disabled individuals, based on 
the most current standards defined by the <nl>Commission<ol> [department] in its 
JTPA Equal Opportunity Methods of Administration Manual. 
 
   
  sec.805.264. Required Assurance of Compliance. 
 
  (a) All monitoring reports on SDA/SSAs shall be reviewed by the 
<nl>Commission's<ol> [department's] EO Officer for compliance with the 
provisions of the nondiscrimination and equal opportunity provisions of the 
[Federal] Act, and with the requirement that each application for financial 
assistance under the [Federal] Act shall contain the assurance statement 
required in 29 CFR 34.20. 
   
  (b) To enable monitoring by the <nl>Commission <ol> [department] of SDA/SSA 
efforts to provide equitable services among substantial segments of the eligible 
population, as described in 29 CFR 34.21, all requests for proposals, proposals, 
and contracts must contain information regarding the proposed levels of service 
to males and females, the various racial, ethnic and age groups, and individuals 
with disabilities. 
 
     
  sec.805.265. Data Collection and Maintenance. 
 
  (a) Pursuant to 29 CFR 34.24, subrecipients must collect and maintain 
information on applicants and employees to provide data for determining 
compliance with eligibility requirements and nondiscrimination and equal 
opportunity provisions. Such data collection shall be accomplished through the 
Standardized Program Information Record (SPIR) format promulgated by the U.S. 
Department of Labor pursuant to <nl>the<ol> [Federal] Act sec.165. Instructions 
and information on the SPIR format may be obtained by contacting the Texas 
<nl>Workforce Commission,<ol> [Department of Commerce] at the address shown in 
sec.805.131 of this title (relating to Address for all Submissions, Notices, and 
Requests for Information or Forms). 
   
  (b) In addition to the requirements of 29 CFR 34.24(b), a JTPA subrecipient 
must provide access by the <nl>Commission <ol> [department] to its premises, 
employees, participants and records. 
 
     
  sec.805.266. Complaints of Discrimination. 
 
  (a) Any person alleging a violation of the [Federal] Act sec.167 has the 
option of filing a complaint according to the procedures set forth in 29 CFR 
34.43, with either: 
 
  (1) the Texas <nl>Workforce Commission, <ol> [Department of Commerce,] at the 
address shown in sec.805.260 of this title (relating to State Equal Opportunity 
Officer); or 
   
  (2) (No change.) 
     
  (b) If such person elects to file at the state level with the 
<nl>Commission,<ol> [department,] the local subrecipient shall assist in 
preparation of the person's complaint. State level processing of a 
discrimination complaint shall be handled pursuant to the procedures set forth 
in 29 CFR 34.43(f). 
 
     
  sec.805.267. Jurisdiction.  The <nl>Commission<ol> [department] will accept 
and investigate only those discrimination complaints alleging a violation of the 
[Federal] Act sec.167, in which the respondent is a program or activity funded 
with JTPA funds. Such complaints should be filed within 180 days of the alleged 
violation unless such time limitation is waived by the  <nl>Commission<ol> 
[department] for good and sufficient cause. 
 
   
  sec.805.268. Corrective Actions and Remedies 
 
  (a) At any point in the investigation of a complaint, the complainant, 
respondent or the <nl>Commission's <ol> [department's] EO Officer may request 
that the parties attempt conciliation. The EO Officer will act to facilitate 
such conciliation efforts. The respondent to a discrimination complaint shall 
have ten days from the date the <nl>Commission's<ol> [department's] EO Officer 
makes a final determination on a complaint to accept the <nl>Commission's <ol> 
[department's] suggested resolution of the complaint, which shall describe 
actions necessary to assure compliance with the nondiscrimination and equal 
opportunity provisions of the Federal Act. If the respondent does not accept the 
suggested resolution, or breaches an established resolution or conciliation 
agreement, the <nl>Commission <ol> [department] may impose sanctions pursuant to 
sec.805.269 of this title (relating to Sanctions), or the complaint may be 
forwarded to the Department of Labor for processing. 
   
  (b) In addition to the corrective actions and remedies prescribed by 29 CFR 
34.44(b)(2), a respondent may be required by the <nl>Commission<ol> [department] 
to take any of the following actions: 
 
  (1)-(3) (No change.) 
     
  (c) If the complaint involved discrimination against an applicant for 
employment, a respondent may be required by the <nl>Commission<ol> [department] 
to make a written offer of employment of the type and grade denied to the 
applicant, unless the record indicates the applicant would not otherwise have 
been hired. If the employment is accepted the appointment may be retroactive, 
with back pay, from the date the applicant would have been hired to the date of 
actual employment. The applicant may be deemed to have been employed from the 
retroactive date for all purposes except for meeting a probationary or trial 
employment period. 
 
     
  sec.805.269. Sanctions.  If the <nl>Commission<ol> [department] finds a JTPA 
entity to be in violation of the nondiscrimination and equal opportunity 
provisions of the Federal Act, or such entity has not accepted a suggested 
resolution or conciliation agreement, or has breached an established resolution 
or conciliation agreement, the <nl>Commission<ol> [department] may impose 
sanctions pursuant to sec.sec.805.179-805.182 of this title (relating to State 
[Monitoring and] Sanctions <nl>Policy and Procedures <ol> [Policies]). 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be a valid exercise of the agency's authority. 
 Issued in Austin, Texas, on April 25, 1996. 
 TRD-9605760 
  Carol Kingsbery Otto 
 Attorney, Intergovernmental Relations 
 Texas Workforce Commission 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 463-7833 
         
           
  Subchapter I. JTPA Grievance Procedures 
 
  40 TAC sec.sec.805.280, 805.282-805.284, 805.287, 805.291-805.296, 805.298 
 
  The Texas Workforce Commission proposes amendments sec. s805.280, 805. 282-
805.284, 805.287, 805.291-805.296, and 805.298, concerning rules to implement 
the Job Training Partnership Act (JTPA), pursuant to Texas Labor Code, 
sec.301.061(a) which authorizes the Texas Workforce Commission to adopt rules to 
administer the Workforce and Economic Competitiveness Act (Title 10, Chapter 
2308, Government Code), and Texas Labor Code, sec.302.002(d) which authorizes 
the Texas Workforce Commission to adopt rules necessary for the administration 
of the Division of Workforce Development. 
 The Sections 805.280-805.298 define and establish state procedures for 
resolving grievances regarding violations of the JTPA. 
 The revised sections are proposed to replace references to the Texas Department 
of Commerce with references to the Texas Workforce Commission, which pursuant to 
Texas Government Code, sec.301.063(a)(2) is the state administrative entity for 
the JTPA and to remove references to a state JTPA which was repealed by Acts 
1995, 74th Legislature, Chapter 655. 
 Section 805.296 (relating to Appeal of a Commission Action or Decision) is 
amended to include a provision for an agreed extension of time in setting a 
formal hearing date. Section 805.298 (relating to Final State Action) is amended 
to provide that final review of a decision shall be performed by the Texas 
Workforce Commission instead of the Governor, or the Governor's designee. 
 Fabian Gomez, JTPA Attorney, Texas Workforce Commission, has determined that 
for the first five-year period the sections are in effect there will be no 
fiscal implications for state or local government as a result of enforcing or 
administering the sections. 
 Mr. Gomez has also determined that for each year of the first five years the 
proposed sections are in effect, the public benefits anticipated as a result of 
enforcing the sections will be to facilitate the development and implementation 
of effective state and local systems for managing job training, employment and 
related programs in this state. There will be no effect on small businesses. 
There is no anticipated economic cost to persons who are required to comply with 
the sections as proposed. 
 Written comments on the proposed rules may be submitted to Margo Kaiser, JTPA 
Attorney, Texas Workforce Commission, 211 East 7th Street, Suite 1000, Austin, 
Texas 78701, within 30 days of the publication of the proposed sections. 
 The amendments are proposed under the Texas Labor Code,  s301.061(a), which 
authorizes the Texas Workforce Commission to adopt rules to administer the 
Workforce and Economic Competitiveness Act (Title 10, Chapter 2308, Government 
Code), and Texas Labor Code, sec.302.002(d), which authorizes the Texas 
Workforce Commission to adopt rules necessary for the administration of the 
Division of Workforce Development; and pursuant to the Administrative Procedure 
Act, Texas Government Code, Chapter 2001, Subchapter B, which mandates the 
rulemaking procedures for state agencies. 
 The following statutes are affected by the proposed Texas Labor Code, 
sec.301.063(a)(2) Texas Government Code, sec. s2308.204, 2308.303(a)(6) and 
2308.304(a)(1). 
 
 
  sec.805.280. Purpose and Coverage. In addition to the grievance procedures set 
forth in <nl>the<ol> [Federal] Act sec.144, and in accordance with the grievance 
procedures in 20 CFR, Part 627, Subpart E, this subchapter establishes state 
procedures for resolving allegations of violations of the [Federal] Act in the 
operation of JTPA programs and activities. These procedures cover complaints 
alleging a non-criminal violation of the [Federal] Act, and do not apply to 
complaints of discrimination pursuant to <nl>the<ol> [Federal] Act sec.167. The 
Commission may waive specific provisions of this grievance procedure. 
 
   
  sec.805.282. Grievance Filing Procedures at the Local Level. 
 
  (a) Any person or organization alleging a violation of the [Federal] Act at 
the local level may file a complaint by submitting a written grievance to the 
JTPA contractor responsible for the alleged action, with a copy of the grievance 
to the  <nl>Commission<ol> [department]. The grievance must be signed and dated 
by the complainant and shall include the following information: 
 
  (1) (No change.) 
     
  (b) To facilitate the filing of a grievance or complaint the complainant may 
request a JTPA Grievance Information Form from the JTPA contractor or from the 
<nl>Commission <ol> [department] at the address shown in sec.805.260 
<nl>(e)<ol>[(d)] of this title (relating to State Equal Opportunity Officer). 
   
  (c) All information and complaints involving allegations of fraud, abuse or 
other criminal activity shall be reported directly to the Texas <nl>Workforce 
Commission <ol> [Department of Commerce], Quality Assurance Division. 
 
     
  sec.805.283. Time Limitations at Local Level. 
 
  (a) All complaints of non-criminal violations must be made within one year of 
the alleged action. The time limitations for complaint resolution specified in 
<nl>the<ol> [Federal] Act sec.144(a) shall begin to run upon the date of receipt 
by the respondent of a properly completed written grievance according to the 
requirements of sec.805.282 of this title (relating to Grievance Filing 
Procedures). The respondent's EO Officer shall be responsible for assisting the 
complainant in correcting an improperly completed grievance filing. 
   
  (b) (No change.) 
 
     
  sec.805.284. JTPA Contractor Responsibilities. 
 
  (a) Each JTPA contractor and its subrecipients shall maintain at their 
principal places of business and all intake centers a copy of the JTPA grievance 
procedure rules in this subchapter, with posted notices that a copy of such 
rules is available upon request by any interested person. The JTPA contractor 
shall also: 
 
  (1) provide the <nl>Commission<ol> [department] with a photocopy of each 
complaint postmarked within three days following the filing of such complaint; 
   
  (2) (No change.) 
   
  (3) designate a staff person as EO Officer to facilitate the complaint 
process, and whose duties shall include: 
 
  (A)-(D) (No change.) 
   
  (E) coordinating each step of the JTPA grievance procedures occurring prior to 
an appeal to the <nl>Commission <ol> [department]; and 
     
  (4) (No change.) 
     
  (b) (No change.) 
 
     
  sec.805.287. Opportunity and Request for a Hearing. 
 
  (a) If an informal resolution was not achieved the written determination sent 
to the complainant must include notification of an opportunity for a hearing. 
The notification must inform the complainant that: 
 
  (1)-(2) (No change.) 
   
  (3) the JTPA contractor shall select a hearing officer, as provided in 
sec.<nl>805.289<ol> [805.290](a) of this title (relating to Hearing Officer); 
   
  (4)-(5) (No change.) 
     
  (b) (No change.) 
 
     
  sec.805.291. Written Decision. <ol> The Hearing Officer shall provide to the 
EO Officer a written decision within 30 days following the hearing. The EO 
Officer shall transmit such decision, not later than 60 days following receipt 
of a properly completed JTPA grievance filing, to all parties to the complaint 
and to the <nl>Commission<ol> [department]. Such written decision shall contain 
at minimum the following information: 
 
  (1)-(5) (No change.) 
 
     
  sec.805.292. Request for Review of a Written Decision. 
 
  (a) The EO Officer shall issue, together with the written decision, a notice 
informing any adversely affected party of the opportunity to request the 
<nl>Commission<ol> [department] to review the decision. The notice must inform 
the party that to obtain such review a written request for review must be filed 
with the <nl>Commission <ol> [department] within ten days from the date upon 
which the party received the written decision, or the written decision will be 
final. 
   
  (b) The complainant may also request a review if a written decision is not 
received from the JTPA contractor within 60 days of the filing of a properly 
completed JTPA grievance filing. Such request for review must be filed with the 
<nl>Commission <ol> [department] within ten days from the date the complainant 
should have received a written decision. 
   
  (c) (No change.) 
   
  (d) The request for review must be dated and sent by registered or certified 
mail to the address shown in sec.805.260 <nl>(e)<ol>[(d)] of this title 
(relating to State Equal Opportunity Officer). 
 
     
  sec.805.293. Procedure for Review by the Texas  23>Workforce Commission 
[Department of Commerce]. 
 
  (a) Upon receipt of a request for review of a written decision prepared 
according to the format specified in sec..293805.292 of this title (relating to 
Request for Review of Written Decision), the <nl>Commission<ol> [department] 
shall direct the JTPA contractor to provide, within five days of receipt of the 
request, the complete file relating to the complaint. 
   
  (b) Upon receipt of the JTPA contractor's information, the <nl>Commission<ol> 
[department] shall have the following options: 
 
  (1)-(3) (No change.) 
 
       
  sec.805.294. Final Written Decision. The <nl>Commission <ol> [department] 
shall issue to all parties a written decision within 30 days from the filing of 
a properly completed request for review, which written decision shall be the 
final decision rendered at the state level on a complaint and shall either 
sustain or overrule in whole or in part the Hearing Officer's decision. 
 
   
  sec.805.295. Optional Forms Available. To facilitate the filing, processing, 
or withdrawal of a complaint the <nl>Commission<ol> [department] has developed 
the "JTPA Grievance Information Form", the "Withdrawal of Non-EEO Complaint" and 
the <nl>"Commission <ol>[Commerce]/JTPA Request for Hearing Form" which may be 
reproduced and are available from the address listed in sec.805.260  
<nl>(e)<ol>[(d)] of this title (relating to State Equal Opportunity Officer). 
 
   
  sec.805.296. Appeal of a <nl>Commission [Department] Action or Decision 
 
  (a) A subrecipient adversely affected by an administrative decision, the 
imposition of sanctions or by the findings in a Final Determination Letter by 
the <nl>Commission <ol> [department] may appeal the decision by filing a Notice 
of Appeal with the <nl>Commission<ol> [department] within ten days of receipt of 
notification of the action on which the appeal is based. During the appeal 
procedure, the appellant subrecipient shall be referred to as the complainant 
and the <nl>Commission <ol> [department] shall be referred to as the respondent. 
   
  (b) (No change.) 
   
  (c) Within 30 days of the receipt by the <nl>Commission <ol> [department] of a 
notice of appeal, the complainant shall be notified of the date scheduled for a 
formal hearing unless complainant agrees to an extension of time<nl> beyond the 
30 day limit. 
 
     
  sec.805.298. Final State Action. The Hearing Officer shall forward a copy of 
the Proposal for Decision and the hearing record to the <nl>Workforce Commission 
<ol> [governor or a person designated by the governor] for independent review 
and action. Within 30 days of the receipt of such hearing documents, the 
Proposal for Decision may be ratified, modified or rejected by <nl>a majority of 
the Workforce Commissioners,<ol> [the governor, or his designee,] as the final 
state action on the appeal. 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be a valid exercise of the agency's authority. 
 Issued in Austin, Texas, on April 25, 1996. 
 TRD-9605761 
  Carol Kingsbery Otto 
 Attorney, Intergovernmental Relations 
 Texas Workforce Commission 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 463-7833 
         
                 
  TITLE 43. TRANSPORTATION 
 Part I. Texas Department of Transportation 
  Chapter 1. Management 
  
  Subchapter A. Organization and Responsibilities 
 
  43 TAC sec.1.1, sec.1.2 
 
  The Texas Department of Transportation proposes amendments to sec.1.1 and 
sec.1.2, concerning organization and responsibilities. 
 Transportation Code, sec.201.102 requires the commission to develop and 
implement policies that clearly define the respective responsibilities of the 
commission and staff of the department. 
 Senate Bill 971, 74th Legislature, 1995, re-codified the statutes relating to 
transportation into the Transportation Code. 
 The amendments to sec.1.1 and sec.1.2 reflect legislation affecting the 
responsibilities of the commission and the department, changes to the 
department's organizational structure, and revisions to citations of statutes 
now codified in the Transportation Code. 
 Robert W. Jackson, Deputy General Counsel for Policy, has determined that for 
the first five-year period the sections are in effect there will be no fiscal 
implications for state or local government as a result of enforcing or 
administering the sections. 
 Mr. Jackson also has determined that for each year of the first five years the 
sections are in effect the public benefit anticipated as a result of enforcing 
the sections will be to notify the public of the responsibilities of the 
commission and the department, and the department's organizational structure. 
There will be no effect on small businesses and no anticipated economic cost to 
persons who are required to comply with the amendments as proposed. 
 Written comments on the proposed repeal may be submitted to Robert W. Jackson, 
Deputy General Counsel for Policy, Texas Department of Transportation, Dewitt C. 
Greer Building, 125 East 11th Street, Austin, Texas 78701-2483. The deadline for 
receipt of written comments will be 5:00 p.m. on June 10, 1996. 
 The amendments are proposed under Transportation Code,  s201.101, which 
provides the Texas Transportation Commission with the authority to establish 
rules for the conduct of the work of the Texas Department of Transportation, and 
more specifically Transportation Code, sec.201.102, which requires the 
commission to develop and implement policies that clearly define the respective 
responsibilities of the commission and staff of the department. 
 The amendments do not affect other statutes, articles, or codes. 
 
 
  sec.1.1. Texas Transportation Commission. 
 
  (a) (No change.) 
   
  (b) Commission responsibilities. 
 
  (1) The Texas Transportation Commission, with the advice and recommendations 
of the executive director, will: 
 
  (A) <nl>plan<ol> [formulate plans] and <nl>make<ol> policies for the location, 
construction, and maintenance of a comprehensive system of state highways and 
public roads; 
   
  (B) (No change.) 
   
  (C)  <nl>develop<ol> [provide for] a statewide transportation plan <nl>that 
contains <ol> [containing] all modes of transportation, including highways and 
turnpikes, aviation, mass transportation, railroads and high-speed railroads, 
and water traffic; 
   
  (D) award contracts necessary for the improvement of the state highway system, 
as provided by <nl>Transportation Code, Chapter 223, as amended, and 
sec.sec.9.10-9.20 of this title (relating to Highway Improvement Contracts) <ol> 
[Texas Civil Statutes, Article 6674h, et seq]; 
   
  (E)-(L) (No change.) 
   
  (M) <nl>adopt<ol> [establish and make public proclamation of all] rules [and 
regulations] for the <nl>operation<ol> [conduct] of the [work of the] department 
[as may be deemed necessary]; 
   
  (N) divide the department into [geographical] districts <nl>to accomplish the 
department's functions and the duties assigned to it<ol>; 
   
  <nl>(O) provide for the regulation of motor carriers; 
   
  <nl>(P)<ol>[(O)] carry out such transportation functions as may be delegated 
by the governor pursuant to applicable federal law; 
   
  <nl>(Q)<ol>[(P)] establish policy necessary to carry out the duties and 
functions of the department and the commission; and 
   
  <nl>(R)<ol>[(Q)] perform other duties required by law. 
     
  (2)  The commission may, consistent with applicable law, delegate one or more 
of the functions listed under paragraph (1) of this subsection to the executive 
director, other than those functions under <nl>subparagraph<ol> [subparagraphs 
(D) and] (J), and those functions under subparagraph <nl>(P)<ol> [(O)] that are 
delegated solely to the commission. The executive director may further delegate 
such functions to one or more employees of the department. 
     
  (c) Members. Each member of the commission shall: 
 
  (1)  execute a bond payable to the state in the sum of $5,000, to be approved 
by the governor, and conditioned  <nl>on<ol> [upon] the faithful performance of 
the member's duties; 
   
  (2)-(3) (No change.) 
     
  (d) Commissioner of transportation. 
 
  (1) The commissioner of transportation is the chair of the commission and, 
with the advice and recommendations of the executive director and his or her 
staff, shall: 
 
  (A) represent the department in <nl>dealing <ol> [dealings] with the governor; 
   
  (B)  report at least quarterly to the governor on the state of affairs at the 
department; 
   
  (C) report suggestions made by the governor for departmental operations to the 
commission; 
   
  (D) report to the governor <nl>on efforts to maximize<ol> [regarding 
privatization efforts, including any legislative mandates, in order to maximize] 
the efficiency of departmental operations <nl>through the use of private 
enterprise<ol>; 
   
  [(E)  develop recommendations for the organization of the department to be 
submitted to the commission and to the governor and the Legislative Budget Board 
prior to the convening of each session of the legislature;] 
   
  <nl>(E) <ol>[(F)] periodically review the department's organizational 
structure and submit recommendations for <nl>structural changes <ol> [revisions 
to that structure] to the governor, the commission, and the Legislative Budget 
Board; 
   
  <nl>(F)<ol>[(G)] designate  <nl>one or more<ol> [an employee or] employees of 
the department as a civil rights division of the department and receive regular 
reports from <nl>the<ol> [that] division on the department's efforts to comply 
with civil rights legislation and administrative rules; 
   
  <nl>(G)<ol>[(H)] serve as the departmental liaison with the governor and the 
Office of State-Federal Relations [in order] to maximize federal funding for 
highway, public transportation, and aviation purposes; <nl>and 
   
  [(I) serve ex officio as a member of the board of directors of the Texas High-
speed Rail Authority; and] 
   
  <nl>(H)<ol>[(J)] perform any other duties assigned by law. 
     
  (2) (No change.) 
 
       
  sec.1.2. Texas Department of Transportation. 
 
  (a) Executive director. 
 
  (1)-(2) (No change.) 
   
  (3) The executive director shall: 
 
  (A) execute a bond payable to the state in <nl>an amount determined by<ol> 
[such sum as] the commission [may deem necessary, to be approved by the 
commission], and conditioned upon the faithful performance of his or her duties; 
   
  (B) <nl>serve the<ol> [attend] commission [meetings and act with the 
commission] in an advisory capacity <nl>, without vote<ol>; 
   
  (C) submit quarterly, annually, and biennially to the commission detailed 
reports of the progress of public road construction, public and mass 
transportation development, and <nl>detailed <ol> statement of expenditures; 
   
  (D) (No change.) 
   
  (E)  notify the commissioner of transportation of grounds for removal of a 
commission member if having knowledge that a potential ground for removal 
exists; [and] 
   
  <nl>(F) under the direction and with the approval of the commission, prepare a 
comprehensive plan providing a system of state highways; and 
   
  <nl>(G)<ol>[(F)] perform other responsibilities as required by law or assigned 
by the commission. 
     
  (4) The executive director may, consistent with applicable law, delegate one 
or more of the functions listed under paragraph (3)(C)-<nl>(G)<ol> [(F)] of this 
subsection to the staff of the department. 
     
  (b) Department staff. The staff of the Texas Department of Transportation, 
under the direction of the executive director, is responsible for: 
 
  (1) (No change.) 
   
  (2) providing the commissioner of transportation and members of the commission 
administrative support necessary to perform their respective duties and 
responsibilities, including: 
 
  (A)-(D) (No change.) 
   
  (E) preparing an agenda, providing notice, and transcribing commission 
meetings and hearings as required by the Texas Open Meetings Act, <nl>Government 
Code, Chapter 551<ol> [Texas Civil Statutes, Article 6252-17]; and 
     
  (3) (No change.) 
     
  (c) Divisions. The executive director shall organize the department into 
headquarters operating divisions <nl>and special offices<ol> reflecting the 
various functions and duties assigned to the department, and shall designate a 
division <nl>or special office<ol> director who shall administer each division 
<nl>or special office<ol>. 
   
  (d)-(e) (No change.) 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 26, 1996. 
 TRD-9605779 
  Bob Jackson 
 Deputy General Counsel 
 Texas Department of Transportation 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 463-8630 
         
             
  Subchapter B. Public Meetings and Hearings 
 
  43 TAC sec.1.3, sec.1.5 
 
  The Texas Department of Transportation proposes amendments to sec.1.3 and 
sec.1.5, concerning public meetings and hearings. 
 Transportation Code, sec.201.802 requires the commission to provide the public 
with a reasonable opportunity to appear before the commission and speak on any 
issue under the jurisdiction of the commission. 
 Senate Bill 971, 74th Legislature, 1995, re-codified the statutes relating to 
transportation into the Transportation Code. 
 The amendments to sec.1.3 and sec.1.5 reflect legislation affecting the 
responsibilities of the commission and the department, changes to the 
department's organizational structure, and revisions to citations of statutes 
now codified in the Transportation Code. 
 Robert W. Jackson, Deputy General Counsel for Policy, has determined that for 
the first five-year period the sections are in effect there will be no fiscal 
implications for state or local government as a result of enforcing or 
administering the sections. 
 Mr. Jackson also has determined that for each year of the first five years the 
sections are in effect the public benefit anticipated as a result of enforcing 
the sections will be to accurately reflect current law. There will be no effect 
on small businesses and no anticipated economic cost to persons who are required 
to comply with the amendments as proposed. 
 Written comments on the proposed repeal may be submitted to Robert W. Jackson, 
Deputy General Counsel for Policy, Texas Department of Transportation, Dewitt C. 
Greer Building, 125 East 11th Street, Austin, Texas 78701-2483. The deadline for 
receipt of written comments will be 5:00 p.m. on June 10, 1996. 
 The amendments are proposed under Transportation Code,  s201.101, which 
provides the Texas Transportation Commission with the authority to establish 
rules for the conduct of the work of the Texas Department of Transportation, and 
more specifically Transportation Code, sec.201.802, which requires the 
commission to provide the public with a reasonable opportunity to appear before 
the commission and speak on any issue under the jurisdiction of the commission. 
 The amendments do not affect other statutes, articles, or codes. 
 
 
  sec.1.3. Commission Meetings. 
 
  (a) The Texas Transportation Commission will hold at least one regular 
business meeting each calendar month and, subject to the call of the 
commissioner of transportation, any special or emergency meetings necessary for 
the performance of the commission's duties. Each meeting will be conducted in 
accordance with applicable provisions of the Open Meetings Act, <nl>Government 
Code, Chapter 551<ol> [Texas Civil Statutes, Article 6252-17]. 
   
  (b)-(c) (No change.) 
 
     
  sec.1.5. Public Hearings. 
 
  (a) Subject of hearings. The commission may hold public hearings to: 
 
  (1) consider the adoption of rules, in accordance with the Administrative 
Procedure [and Texas Register] Act, <nl>Government Code, Chapter 2001<ol> [Texas 
Civil Statutes, Article 6252-13a]; 
   
  (2) receive evidence and testimony concerning the desirability of acquiring 
dredge material disposal sites and of any widening, relocation, or alteration of 
the main channel of the Gulf Intracoastal Waterway, in accordance with 
<nl>Transportation Code, Chapter 51<ol> [Texas Civil Statutes, Article 5415e-2]; 
   
  (3) provide for public input regarding the design, schematic layout, and 
environmental impact of transportation projects, in accordance with 
<nl>Transportation Code, Section 203.021<ol> [Texas Civil Statutes, Article 
6674w-1], and <nl>sec.2.42 and sec.2. 43 of this title (relating to Highway 
Improvement Projects-Federal-aid and Highway Improvement Projects-State Funds) 
<ol> [sec.11.85 of this title (relating to Early Coordination and Public 
Involvement)]; 
   
  (4)  consider maximum prima facie speed limits on highways in the state 
highway system that are near public or private institutions of elementary or 
secondary education, in accordance with  <nl>Transportation Code, Section 
545.351<ol> [Texas Civil Statutes, Article 6701d,  s167]; 
   
  (5) receive testimony regarding a proposed order establishing maximum prima 
facie speed limits, in accordance with <nl>Transportation Code, sec.545.362<ol> 
[Texas Civil Statutes, Article 6701d, sec.169B]; 
   
  (6) annually receive public input on the commission's highway project 
selection process and the relative importance of the various criteria on which 
the commission bases its project selection decisions, in accordance with 
<nl>Transportation Code, Section 201.602<ol> [Texas Civil Statutes, Article 
6673k]; 
   
  <nl>(7) receive comments from interested persons prior to transferring a 
segment of the state highway system to the Texas Turnpike Authority under 
Transportation Code, sec.362.0041; 
   
  <nl>(8)<ol>[(7)] receive comments from interested parties prior to approving 
any financial assistance under <nl>Transportation Code, sec.21. 111<ol> [the 
Texas Aeronautics Act, Texas Civil Statutes, Article 46c-1 et seq] ; and 
   
  <nl>(9)<ol>[(8)] provide, when deemed appropriate by the commission or when 
otherwise required by law, for public input regarding any other issue under the 
jurisdiction of the commission. 
     
  (b) Authorized representative. The executive director or an employee of the 
department designated by the executive director may conduct public hearings held 
under subsection (a)(1), (3), and <nl>(9)<ol> [(8)] of this section. 
   
  (c)-(e)  (No change.) 
 
  This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's authority to adopt. 
 Issued in Austin, Texas, on April 26, 1996. 
 TRD-9605780 
  Bob Jackson 
 Deputy General Counsel 
 Texas Department of Transportation 
    Earliest possible date of adoption: June 7, 1996 
 For further information, please call: (512) 463-8630