ADOPTED RULES An agency may take final action on a section 30 days after a proposal has been published in the Texas Register. The section becomes effective 20 days after the agency files the correct document with the Texas Register, unless a later date is specified or unless a federal statute or regulation requires implementation of the action on shorter notice. If an agency adopts the section without any changes to the proposed text, only the preamble of the notice and statement of legal authority will be published. If an agency adopts the section with changes to the proposed text, the proposal will be republished with the changes. TITLE 16. ECONOMIC REGULATION Part II. Public Utility Commission of Texas Chapter 23. Substantive Rules Records and Reports 16 TAC sec.23.13 The Public Utility Commission of Texas adopts an amendment to sec.23.13, concerning Statistical Reports, with changes to the proposed text published in the November 21, 1995 issue of the Texas Register (20 TexReg 9626). This amendment adds a new subsection (f) titled "Infrastructure Reports" which details the information to be filed by an incumbent local exchange company to ensure compliance with the infrastructure commitments mandated by the Public Utility Regulatory Act of 1995 (PURA 95 or the "Act"), sec.3.358, sec.3.359, and sec.3.403. The amendment also allows the commission to analyze general infrastructure deployment throughout the state. An incumbent local exchange company that elects incentive regulation under subtitle "H" or "I" of the Act is required to deploy certain telecommunications infrastructure in its service areas within the state of Texas. In addition, the Act requires an electing incumbent local exchange company to deploy telecommunications network infrastructure to certain requesting entities in order to enable such entities to have ubiquitous, broadband, digital services for voice, video, and data. The proposed rule requires an electing incumbent local exchange company to file an annual infrastructure report on the anniversary date of its election in order for the commission to track the progress of telecommunications infrastructure deployment in the state. A number of minor clarifying changes and changes relating to the level of reporting detail required were made throughout the proposed text. The most significant change involves modifying the level of detail required for the reporting of investment and expense data for both the general deployment of certain types of infrastructure and the deployment of infrastructure to certain entities. The commission received written comments on the proposed rule from the Texas Telephone Association (TTA), United Telephone Company of Texas, Inc. and Central Telephone Company of Texas (United/Centel), Office of Public Utility Counsel (OPUC), Consumers Union (CU), and Southwestern Bell Telephone Company (SWBT). A public hearing on this proposal was held December 5, 1995 with oral comments received from SWBT and CU. The oral comments made by the parties at the public hearing were largely reflective of their subsequent written comments and therefore considered by the commission in conjunction with their written comments. In general, the commenting parties supported the rulemaking and reporting requirements related to the progress made by electing local exchange companies toward their infrastructure commitments. However the parties expressed differing opinions over the type and form of information required, and the duration of the reporting requirement under the proposed rule. SWBT commented that this rule should be self-eliminating after December 31, 2000, as the information would not be needed after that time, and suggests a change to sec.23.13 (f) to include the ending date for the reporting requirement. The commission believes that the infrastructure commitment of electing companies is one of the most fundamental elements of the incentive regulation plans created by PURA 95. An electing company's commitment to infrastructure deployment is given in exchange for a beneficial form of regulation for the electing company. Consequently, ensuring fulfillment of an electing company's infrastructure commitment is a paramount regulatory goal for the commission. Furthermore, one of the primary goals of PURA 95, both within Subtitles "H" and "I" and within numerous other statutory sections describing the policy goals of the Act, is to generally promote deployment of advanced telecommunications infrastructure. Consequently, information on infrastructure development is important to the commission, even outside the context of the formal commitment by an electing company. Further, requiring the reporting of this information is consistent with the commission's authority to require statistical reports generally. Therefore, the commission deems it appropriate not to include a provision for self-elimination of the reporting requirements even though the various infrastructure commitments may have been met. Moreover, it is possible that infrastructure commitments will not have been met, further supporting a decision that ongoing reporting will be appropriate. A number of comments were received about the proposed requirement for reporting of associated investment and expense data. SWBT commented that there is no requirement in PURA 95 that the expenses of Subtitle "H" companies be tracked or reported. SWBT also commented generally that the required investment and expense data was competitively sensitive, that it is unclear what type of "expense" data is required, and that SWBT does not currently track expense data for each type of infrastructure. Additionally, SWBT commented that the intent of PURA 95 is not to track a specific change over time, but rather to reach a targeted outcome by December 31, 2000. TTA commented that when the dollar investment amount was removed from the language of HB 2128, that any tracking of monetary investments was intended to go away as well. CU commented that although the statute as passed does not specify an amount of investment required in monetary terms, this reflects the legislature's intent that the effectiveness of the infrastructure commitment should not be mitigated by insufficient monetary investment. Consequently, CU stated that the reports must include annual expenditures by electing companies for purposes of comparison with historic expenditures. The commission concurs in general with CU's position that the annual expenditure by electing companies would provide a basis for comparison with historic expenditures. While it is true that the PURA 95 sets the target for compliance in terms of specific infrastructure commitments, it does not restrict the commission from obtaining information concerning capital investments associated with those commitments. The purpose of collecting investment data is not for verifying compliance with any particular investment target or with the infrastructure commitments themselves, but is required for statistical purposes to allow the commission to analyze infrastructure deployment in the state from an investment standpoint. Furthermore, PURA 95 sec.3.403(g) specifically requires investment and expense data associated with infrastructure commitments to be reported by companies electing under Subtitle I. While PURA 95 does not explicitly require the reporting of investment and expenses of Subtitle H companies, the commission finds it reasonable and beneficial to require the same investment and expense information from Subtitle H companies as from Subtitle I companies. The legislature has not limited the commission's authority under PURA 95 sec.sec.1.201, 1.202 to require such reports of Subtitle H companies. The commission agrees that the wire center-level of detail required by the proposed rule for investment and expense data may be very competitively sensitive and would be difficult to track (particularly for expense data). PURA 95 sec.3.403(g) does not specify the level of detail for reporting of investment and expense data, and the commission acknowledges that the investment and expense data is not required to determine compliance with infrastructure commitments. Therefore, the commission modifies each paragraph of sec.23.13(f) to require that investment and expense data shall be reported on an aggregate basis for each type of infrastructure. This level of detail should not be competitively sensitive and should more closely correspond to the data that an electing company currently maintains. The commission disagrees with SWBT's contention that the legislature did not intend that the commission should track an electing company's progress toward fulfillment of its infrastructure commitment. PURA 95 sec.sec.3.358(c), 3.403(b) state "the commission shall act" to ensure that infrastructure goals are achieved. The commission cannot ensure that infrastructure goals will be achieved in the time specified by PURA 95 if it does not have information on an electing company's progress. SWBT commented that the information required by subsection (f)(1)(A) would give valuable market penetration information, which would be of uncertain usefulness to the commission. SWBT stated that the information would seem to be of more use if the number of "available" lines were provided. SWBT plans to fulfill the digital end-to-end connectivity requirement via the use of ISDN lines such as DigiLine and SmartTrunk, therefore the information required here exists today in response to reporting requirements under P.U.C. Substantive Rule 23.69. The commission concurs with SWBT and modifies subsection (f)(1)(A) to include the word "available" at the end of the first sentence. The commission adopts the remainder of sec.23.13 (f)(1)(A) as proposed. SWBT commented that the level of detail required in subsection (f)(1)(C) relating to the total number of equipped and active channels is burdensome. Accordingly, SWBT suggests that this section be eliminated in its entirety. United/Centel stated that if a voice channel is defined as an access line, the information requested under subsection (f)(1)(C) of the rule is the same as previously requested in subsection (f)(1)(A), and therefore it considers this requirement to be redundant and suggested that it be removed. The commission believes that the information required by subsection (f)(1) (C) of the rule is necessary to quantify the deployment of infrastructure by the electing companies. The information required under this subparagraph is necessary to assess the number of channels that are active on fiber versus copper, and also to measure the utilization factor in terms of equipped versus active channels. "Channels" would include the number of voice paths in a multiplexed environment. This information is also necessary to ascertain the effective usage of the fiber network. The commission believes that the level of detail required is no greater than what any electing company provides to the Federal Communications Commission ("FCC") in its ARMIS 43-07 report. In order to provide credible data in an aggregated form to the FCC, an electing company should derive the information from each wire center. Subparagraph (C) requires the same information in disaggregated form, broken down to each wire center level. Therefore, the commission adopts sec.23.13(f)(1)(C) as proposed. SWBT commented that the schematic diagram information requested as part of subsection (f)(3)(B) of the rule is competitively sensitive and that the proposed rule specifies a level of detail not compiled in the course of doing business today. The commission believes that schematic diagrams provide the best illustration of broadband facility deployment between central offices. SWBT has provided this type of information for the PUC staff report regarding fiber deployment in the state, and the rule is seeking the same level of detail. The requirement in this rule is to provide a similar type of information on an annual basis in order to track the deployment activity. SWBT's general opposition to required reporting that does not coincide with SWBT's current practices is noted by the commission. However, the commission believes that it is inappropriate to allow the current practices of any electing company to determine what data should be reported. Consistent with the commission's general authority to require reporting, and with the broad scope of PURA 95 sec.3.403(g), the rule throughout reflects the commission's determination of what data and what level of detail are appropriate. The commission anticipates that there will be some expense associated with infrastructure reporting, but believes that such expense is justified as part of the incentive regulation plan authorized by the statute. Although the reporting requirements contained in the rule may be somewhat duplicative of other commission rules, or administratively burdensome, the commission believes that the benefits of these reports outweigh the concerns expressed by some commenters. However, the commission recognizes that reporting of the exact location would be competitively sensitive. The rule has been modified to make clear that the "location" referred to in the rule is intended to require reporting of location relative to central offices or wire centers. The schematic diagrams requested are not meant to disclose the actual routing of facilities by showing their location relative to streets, rivers, buildings or other physical landmarks. SWBT commented that the requirements in subsection (f)(5) of the rule require the LECs to file an extensive amount of competitively sensitive information that is not required by the legislation. Further, the level of detail requested is not currently maintained by SWBT. The commission believes that the information required by the rule is necessary to quantify the deployment of infrastructure by the electing companies. The rule does not specifically require details that are greater than the level provided by SWBT for the commission's fiber deployment report. However, the commission recognizes that reporting of the exact location would be competitively sensitive. The rule has been modified to make clear that the "location" referred to in the rule is intended to require reporting of location relative to central offices or wire centers. The schematic diagrams requested are not meant to disclose the actual routing of facilities by showing their location relative to streets, rivers, buildings or other physical landmarks. SWBT also commented that subsection (f)(6) of the rule, concerning infrastructure commitments to certain entities, requires an electing company to file an extensive amount of confidential customer-specific information that is not required by the legislation. The commission finds that the purpose of the reporting requirement is to ensure that certain "public entities" that request telecommunications services have benefited from incentive regulation as required by PURA 95. Both Subtitle "H" and Subtitle "I" electing companies are required to provide various services that are requested by certain public entities. Specific information concerning geographic location of the entity is necessary to ensure that such benefits are realized in rural, urban, and lower economic regions. The commission recognizes that the information regarding the name of the contact person may be confidential or in some instances may not be available, therefore the rule is revised to delete that requirement. The commission also recognizes that the investment and expense data associated with such infrastructure deployment to a specific entity may be difficult to quantify and would be competitively sensitive to provide. The commission believes that the investment and expense reporting requirement of PURA 95 sec.3.403(g) can be reasonably interpreted to relate to types of infrastructure and not the specific services provided to certain entities. Therefore, this requirement of the statute is satisfied by the investment and expense data required by sec.23. 13(f)(1)-(5), and the commission modifies subsection (f)(6) to eliminate the reporting of such data for certain entities. However, PURA 95 sec.sec.3.359(b), and 3.403(c) generally require an electing company to file with the commission a customer-specific contract when providing certain infrastructure to certain entities, and subsection (f)(6) of the rule has been modified to include this requirement. SWBT also proposed to add a paragraph (7) to subsection (f) of the rule, which would fulfill a requirement of HB 2128 that electing companies provide a list of those exchanges with no digital presence or which have been upgraded with a digital presence. The commission concurs with SWBT's recommendation and includes the suggested language of SWBT, with additional language indicating that this information is only required to be submitted in an electing company's initial report. United/Centel commented that Subtitle "H" and Subtitle "I" requirements should be separated within the rule. Specifically, United/Centel noted that Subtitle "I" companies are required to report on the deployment of Common Channel Signaling 7 ("SS-7") technology for access tandem offices, while the proposed rule tracks the requirement of Subtitle "H" companies for SS-7 technology deployed in central offices. Also, United/Centel stated that the requirement to file a hard copy report is acceptable, but that the electronic reporting requirement is burdensome and inefficient. United/Centel did not feel it justifiable to require the creation of other databases or spreadsheets to meet the electronic reporting requirement. United/Centel also commented that the schematic diagrams required to show the location and quantity of interoffice broadband facilities is redundant to the other reporting requirements for broadband facilities, and will produce an overwhelming volume of data for the commission. The commission agrees that while there are some differences between the level of infrastructure commitment under Subtitles "H" and "I," the types of infrastructure required to be deployed are essentially the same. Regarding SS-7 technology deployment, the commission finds that it would be beneficial to receive information from Subtitle "H" and Subtitle "I" electing companies about SS-7 deployment in both central offices and access tandem offices. Accordingly, sec.23.13(f)(4)(A) is amended to require information on deployment of facilities for both types of offices. Compliance with the appropriate infrastructure commitment will be verified by comparing information provided by the electing company to the relevant statutory provisions; therefore it is not necessary to have separate rules for each type of electing company. The commission also does not agree that it would be unduly burdensome for electing companies to file a report in electronic format. The purpose of the requirement is to file a copy on a floppy disk rather than filing multiple copies on paper. The electronic format will facilitate the commission staff's ability to compile and format the data in multiple ways that will be useful for assessing not only compliance with infrastructure commitments but also progress in infrastructure development generally. The electronic format should comply with Microsoft Windows compatible word processing programs and Windows compatible spreadsheet software such as Microsoft Excel or Lotus spreadsheet. Electing companies should provide their infrastructure reports under this rule in the same format as provided for the Commission's Scope of Competition Data Request; additional fields may be added to the tables utilized by the Data Request in order to provide the information required by this rule. CU commented that with regard to end-to-end digital connectivity, digital switch deployment, and Common Channel Signaling deployment, the rule does not require a type of reporting that would show the location of the offices and wire centers receiving the infrastructure improvements. CU also commented that the type of schematic diagram required for reporting the location and quantity of broadband and fiber optic facilities should be spelled out more clearly and designate a format to be followed. CU further recommends that all of the information should be presented in a map format which is overlaid on census tract maps. CU stated that the reporting of infrastructure investment by census tract will provide information about lower income, minority and rural areas in a way that other reporting methodologies will not. OPUC concurred in the comments of CU regarding the need for providing the data on census tract maps. The commission believes that CU's concern regarding the geographic locations of facilities should be addressed by an analysis of the infrastructure deployment which relates the information contained in reports to the exchange or wirecenter boundaries that are recognized by the commission's record maps. The type of schematic diagram required by the rule appears to be generally understood by electing companies required to comply with the rule; "schematic diagram" refers to relative locations that are diagramatic in nature, and not actual construction drawings that would show the physical plant in greater detail. The commission notes that the emphasis in PURA 95 regarding infrastructure deployment that reaches lower income, minority, and rural areas is contained in statutory sections addressing the infrastructure commitments to certain entities. The commission believes that the location information required by subsection (f)(6) of the rule adequately addresses this concern. The amendment is adopted under the Public Utility Regulatory Act of 1995, sec.1.101, which provides the Public Utility Commission of Texas with the authority to make and enforce rules reasonably required in the exercise of its powers and jurisdiction; sec. sec. 1.201, 1.202, which provides the commission with the general authority to require public utilities to provide reports which the commission deems necessary; sec.3.358(c), which requires the commission to ensure that certain infrastructure goals are achieved; sec.3. 403(b), which requires the commission to ensure that certain infrastructure goals are achieved; and sec.3.403(g) which requires each electing local exchange company to file an annual report with the commission which sets forth its progress on infrastructure deployment. Cross Index to Statutes: Article 1446-o, Texas Civil Statutes, sec.sec.1.101, 1.201, 1.202 3.358, 3.359, 3.403. sec.23.13. Statistical Reports. (a)-(e) (No change.) (f) Infrastructure Reports: Each incumbent local exchange company (LEC) that elects incentive regulation under the subtitles "H" or "I" of the Public Utility Regulatory Act (PURA 95 or "the Act") shall file an infrastructure report with the commission each year on the anniversary date of its election. One copy of the report must be filed as a hard copy, and one copy must be filed in an electronic format. The report must include sufficient information to ensure compliance with the requirements of sec.sec.3.358, 3.359, and 3.403 of the Act. At a minimum, the report must include the following information: (1) End-to-end digital connectivity. (A) Percent and total number of access lines that have end-to-end digital connectivity available. Also, total number of lines that were upgraded to end- to-end digital connectivity during the previous year and cumulative for the period since election. This information shall be provided for each wire center or central office, identified by name and Common Language Location Identification (CLLI) Code, and by class of customers (such as residential and business). (B) The associated investment and expense for the previous year and cumulative for the period since election. (C) The total number of equipped and active voice channels, number of channels on fiber optics, and number of channels on copper facilities. This information shall be provided for each wire center or central office, identified by name and CLLI Code. (2) New digital switch deployment. (A) Percent and total number of local exchange access lines served by digital switching facilities. Also, total number of lines that were served by new digital switching equipment during the previous year and cumulative for the period since election. This information shall be provided for each wire center or central office, identified by name and CLLI Code. (B) Percent and total number of central offices equipped with digital switching facilities. Also, total number of central offices that were equipped with new digital switching equipment during the previous year and cumulative for the period since election. This information shall be provided for each wire center or central office, identified by name and CLLI Code. (C) The associated investment and expense for the previous year and cumulative for the period since election. (D) The type, make, and quantity of switching equipment installed during the previous year. This information shall be provided for each wire center or central office, identified by name and CLLI Code. Also include actual installation and service dates of the switch along with a brief description of its functionalities and capabilities. (3) Inter-office broadband facilities (capable of transmitting at least 45 megabits per second of digital information). (A) Percent and total number of inter-office facilities that use broadband facilities. Also, total number of inter-office facilities that were upgraded for broadband capability during the previous year and cumulative for the period since election. (B) Include schematic diagrams that indicate quantity (such as fiber sheath miles, and number of strands, number of DS-3 channels or optical channels, etc.) and relative location for each such facility, for the previous year. Also include installation and service dates for such facilities. (C) The associated investment and expense data for such facilities, for the previous year and cumulative for the period since election. (4) Common Channel Signaling System (SS-7) deployment. (A) Percent and total number of central offices equipped with SS-7 capability. Also, total number of central offices that were equipped with SS-7 capability during the previous year and cumulative for the period since election. This information shall be provided for each wire center or central office, identified by name and CLLI Code. Also include actual installation and service dates of SS- 7 capability along with a brief description of its functionalities. (B) The associated investment and expense data for such facilities, for the previous year and cumulative for the period since election. (5) Fiber optic facilities to tandem central offices. (A) Percent and number of serving central offices that have optical fiber facilities to their connecting tandem offices. Also, total number of serving central offices that were upgraded with fiber optic facilities to their respective tandem switching office during the previous year and cumulative for the period since election. (B) Include schematic diagrams that indicate quantity (such as fiber sheath miles, and number of strands, or number of DS-3 channels or optical channels etc.) and relative location of each such facility, for the previous year. Also include installation and service dates for those facilities. (C) The associated investment and expense data, for the previous year and cumulative for the period since election. (6) Infrastructure commitment to certain entities. (A) Identify each entity, by name and type, that requests services provided under PURA sec.3.359 or sec.3.403, as applicable. Include the address and telephone number for each entity served. (B) For each entity identified in subparagraph (A) of this paragraph, list the date of each request and the actual installation and service dates. Also list the type of service(s) requested and actually provided, including quantity and location. Provide information that describes the functionalities and application of each type of service provided. (C) For each service provided to an entity under PURA sec.3.359 or sec.3. 403, except for point-to-point intraLATA 1.544 megabits per second service offered at a flat monthly tariff rate under PURA sec.3.359(b)(1)(D), a customer specific contract shall be filed with the commission within 30 days of the execution of the contract. Information under this subparagraph need not be included in the annual report required by this subsection, although the annual report should refer the reader to this filing for specific data. (7) A listing of exchanges with no digital presence as of September 1, 1995. Also, state which exchanges have been upgraded with digital service and the date put in service. The information required by this paragraph shall be provided in an electing company's initial report under this subsection, and is not required to be provided in subsequent reports. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's authority. Issued in Austin, Texas, on May 14, 1996. TRD-9606657 Paula Mueller Secretary of the Commission Public Utility Commission of Texas Effective date: June 4, 1996 Proposal publication date: November 21, 1995 For further information, please call: (512) 458-0100 Telephone 16 TAC sec.23.99 The Public Utility Commission of Texas adopts new sec.23.99, relating to unbundling of the incumbent local exchange company (ILEC) network, with changes to the text as published in the December 15, 1995 issue of the Texas Register (20 TexReg 10721). The rule is authorized by sec.3.452(a) of the Public Utility Regulatory Act of 1995 (PURA 95), which requires an ILEC, at a minimum, to unbundle its network to the extent ordered by the Federal Communications Commission (FCC). The new rule, sec.23.99, requires ILECs to unbundle their networks pursuant to current as well as future FCC requirements. The new rule defines terms, sets forth costing and pricing standards, and establishes deadlines and procedures necessary to effect unbundling requirements laid out in PURA 95 sec.3.452(a). The public benefit anticipated by implementation of this rule is the ability of carriers to purchase only those components of the local exchange company (LEC) network that they need to compete with the local exchange carrier. The enhanced competition in telecommunications markets should provide additional service choices to customers, increase incentives for efficiency and lower prices, and facilitate new and innovative services. The access to unbundled services and the resulting impact on competition in telecommunications markets are expected to have a positive effect on small and large businesses. Workshops were held on October 30, 1995 and November 16, 1995 to discuss unbundling issues and staff's draft of the proposed rule. The following parties filed initial comments in response to the proposed rule published in the December 15, 1995 issue of the Texas Register (20 TexReg 10721): AT&T Communications of the Southwest, Inc. (AT&T); GTE Southwest Incorporated (GTE); Office of Public Utility Counsel (OPC); and Southwestern Bell Telephone Company (SWBT); and United Telephone Company of Texas, Inc. and Central Telephone Company of Texas (collectively referred to as United/Centel). Reply comments were filed by AT&T, SWBT, and MCI. A public hearing was held on February 6, 1996. AT&T, OPC, and SWBT offered oral comments which have been summarized to the extent they vary from the written comments. While all commentaters recommended changes to specific provisions of the rule, they supported the adoption of the unbundling rule. As a result of the comments received during the comment period and at the public hearing, certain revisions have been made to the proposed rule. Discussion of the comments will refer to the sections of the rule as published in the Texas Register and will note the new location of the affected provision. SWBT commented that if unbundling is to enhance competition and customer choice, then the rule should apply to all certificated telecommunications utilities (CTUs) and that no distinction should be made between ILECs and other CTUs. In their reply comments, AT&T and MCI responded that SWBT's suggestion contradicts the specified purpose of this rule and the requirements of PURA 95 sec.3.452(a). They further commented that PURA 95 sec.3.452(a) which requires unbundling to the extent required by the FCC, applies only to ILECs. In its reply comments, MCI stated that SWBT's argument that all CTUs should be subject to the unbundling requirement is wrong. MCI argued that the legislature clearly intended that the unbundling provision apply to ILECs which have the option and ability to elect incentive regulation as provided by Subtitle H of PURA 95. MCI supported its position by pointing out that only ILEC unbundled services would be assigned to various basket categories by the commission. The commission disagrees with SWBT's suggestion because PURA 95 sec.3.452(a) specifically applies only to ILECs. Hence, no modification is made to the rule. Because the proposed rule limits unbundling to ILECs, SWBT stated that orders to "further unbundle" would require new rules. AT&T agreed that further unbundling can and should be the subject of a separate rulemaking. The commission agrees with SWBT and AT&T. The commission notes that Project Number 14959 has been initiated to address further unbundling which will be, at a minimum, consistent with and may go beyond future FCC unbundling requirements. Proposed subsection (b) applied the provisions of the proposed rule to three categories of ILECs. Applicability to each category would be triggered differently and as follows: 1) ILECs that serve one million or more access lines must unbundle as of the effective date of the rule; 2) ILECs that serve 31,000 or more, but fewer than one million access lines must unbundle as of the effective date of the rule and upon a bona fide request; and 3) ILECs that serve fewer than 31,000 access lines must unbundle upon a bona fide request after September 1, 1998. AT&T proposed deleting duplicative references to the applicability of the rule in subsection (d) unless needed for further clarification. The commission agrees with AT&T. Removal of the duplicative language will make the rule less complex and easier to read. Hence, the commission deletes the duplicative language in proposed subsections (d)(1)(B),(C), and (D), and (d)(2)((B),(C), and (D). Proposed subsection (c) set forth definitions of various terms used in the section. As defined in subsection (c)(1), a bona fide request must reflect an intent to purchase provided the parties involved are able to negotiate mutually acceptable rates, terms, and conditions. AT&T suggested that the reference to negotiations should be deleted because each purchaser should not have to negotiate individually with the ILEC if unbundled rate elements need to be tariffed and made available to all purchasers. SWBT responded that negotiations are an appropriate vehicle because unbundling should be required only if it is predicated on actual demand. It is not the commission's intent that rates be negotiated individually between the ILEC and the purchaser. The commission notes that under this rule, ILECs are required to unbundle to the extent ordered by the FCC; therefore, the issue of predicating unbundling on actual demand, as suggested by SWBT, does not arise. The commission agrees with AT&T that subsection (c)(1) should be modified so that the purchaser is required to indicate an intent to purchase the unbundled service provided the purchaser is able to obtain acceptable rates, terms, and conditions. The language in subsection (c)(1) is modified accordingly. OPC requested clarification of the terms "basic network facilities and services" and "basic network" in subsection (c)(4). OPC suggested that the commission should either define these terms or not use the terms, noting that the term "basic service" is defined in PURA 95. The commission agrees with OPC and deletes the word "basic" in the terms "basic network" and "basic network facilities and services" in subsection (c) (4). SWBT suggested modifying the definition of "unbundling" in subsection (c)(6) by replacing the disaggregation language, "rate elements used in providing an existing service." with the following: "required to provide and transmit basic local telecommunications service." In its reply comments, AT&T argued that SWBT's modification would narrow the unbundling rule to apply solely to "features required to provide and transmit basic local telecommunications service." AT&T contended that the intent of the proposed unbundling rule goes far beyond "basic local telecommunications services" and that the commission should retain the broad scope of the proposed rule. The commission agrees with AT&T and retains the proposed language in subsection (c)(6) because it is not the commission's intent to limit the unbundling provisions of this section to only the provision and transmission of basic local telecommunications service. Proposed subsection (d) set forth the unbundling requirements. Proposed subsection (d)(1)(A) [renumbered as subsection (d)(1)] set forth unbundling pursuant to current FCC requirements. Specifically, ILECs would be required to unbundle according to the FCC's Open Network Architecture requirements and unbundle signalling for tandem switching. SWBT commented that the minimum unbundling requirement of proposed subsection (d)(1)(A) has no specific deadline for implementation. SWBT commented that it has already satisfied the minimum requirements of proposed subsection (d)(1)(A) and the requirement of the Texas Legislature for LECs to unbundle according to the FCC's Open Network Architecture requirements. SWBT argued that the rule should be read as requiring unbundling to the extent ordered by the FCC on September 1, 1995, the effective date of PURA 95. Citing its February 1992 Texas ONA filings, current intrastate Special Access and Switched Access services collocation tariffs, and other Special Access and Private Line services collocation tariffs filed December 29, 1995, SWBT noted it has met the minimum unbundling requirements. SWBT argued that the commission should reject arguments by others that attempt to expand SWBT's unbundling obligation. AT&T replied that SWBT's assertion that it has already met the minimum unbundling requirements is flawed. AT&T opined that the legislature did not intend its reference to "to the extent ordered by the FCC" to only occur at a specific point in time. The commission disagrees with SWBT on the issue of the Legislature's intended date for compliance with FCC requirements. PURA 95 sec.3.452(a) expressly requires ILECS to unbundle to the extent ordered by the FCC. The state statute nowhere provides a specific snapshot-date for purposes of compliance with FCC orders. Further, the commission believes that if the Legislature had intended a certain snapshot-date to be the effective date of PURA 95's reference to FCC requirements , it would have specified such in PURA 95 sec.3.452(a). Therefore no modification is made to proposed subsection (d)(1) (A) in response to SWBT's comments; however, it has been renumbered as subsection (d)(1). Proposed subsection (d)(1)(A)(i) [renumbered as subsection (d)(1)(A)] required that the ILEC's network be unbundled according to the FCC's Open Network Architecture requirements. In order to more closely reflect the intent of the statutory language of PURA 95 sec.3.452(a), United/Centel suggested adding the following language to the provision in proposed subsection (d)(1)(A)(i), requiring unbundling to the extent ordered by the FCC: "in compliance with its Open Network Architecture (ONA) requirement, and..." United/Centel stated that this modification would alleviate any ambiguities that could arise regarding FCC requirements. SWBT concurred with United/Centel's modification but would also add the phrase,"... in effect as of September 1, 1995." The commission agrees with United/Centel on their point and amends proposed subsection (d)(1)(A)(i) accordingly and renumbers it as subsection (d)(1)(A). The commission declines to adopt SWBT's recommended addition for the reasons enumerated supra in the discussion of subsection (d)(1)(A) [renumbered subsection (d)(1)]. Proposed subsection (d)(1)(A)(ii) [renumbered as subsection (d)(1)(B)] required that ILECs unbundle signaling for tandem switching. GTE requested clarification regarding the intent, scope, and relevance to FCC requirements and tariffs of this statement. In its reply comments, SWBT concurred with GTE's comment. The commission clarifies the language in proposed subsection (d)(1)(A)(ii) [renumbered as subsection (d)(1)(B)] by referring to the appropriate FCC order under which ILECs are required to unbundle signaling for tandem switching. Proposed subsection (d)(2) outlined the unbundling requirements pursuant to future FCC requirements. SWBT contended that the provisions of proposed subsection (d)(2) raise significant legal issues. SWBT contended that although unbundling is expressly limited to ILECs, further unbundling is not. SWBT argued that the legislature intended to address unbundling as ordered by the FCC on September 1, 1995, the effective date of PURA 95. It contended that any further unbundling requires affirmative commission action and an evidentiary hearing (upon request). In its reply, AT&T commented that SWBT's contention was not supported by legislative history or analysis regarding the legislative intent of this provision. AT&T replied that the legislature could not foresee the specific FCC unbundling orders that would be issued as of September 1, 1995. Therefore, there is no reason for SWBT to presume that the legislature would have cut off the unbundling requirement for ILECs at an unspecified date in the future. In their reply comments, both AT&T and MCI argued that the legislature would have made such a limitation an express provision of the law as it had in other sections of PURA 95. AT&T replied that SWBT's interpretation is inconsistent with PURA 95's purpose to promote diversity of providers and interconnectivity and to encourage a fully competitive telecommunications marketplace. In its reply comments, MCI supported AT&T by suggesting that the provision requiring SWBT to unbundle its network is no more fixed in time than those other references to FCC rules found in PURA 95. The commission disagrees with SWBT's comments. As previously mentioned in this preamble, PURA 95 sec.3.452(a) applies only to ILECs. The commission clarifies that proposed subsection (d)(2) refers to unbundling pursuant to future FCC requirements as required by PURA 95 sec.3.452(a) and should not be confused with further unbundling. Further unbundling is addressed in Project Number 14959 and will be, at a minimum, consistent with and may go beyond future FCC unbundling requirements. SWBT claimed that the commission may not mirror the FCC's unbundling rules without observing the requirements of PURA 95 and the Administrative Procedures Act (APA). In its reply comments, AT&T opined that the commission has complied with all of the notice and procedural requirements provided by the APA. AT&T also commented that no provision of the APA supports SWBT's contention that the commission lacks authority to mirror the FCC's unbundling requirements. AT&T posited that the APA applies to all proceedings, except to the extent the APA is inconsistent with the statute. It concluded that to the extent any inconsistency exists between PURA 95 at sec.3.452 and the APA, the more specific provisions of PURA apply. SWBT concluded its comments on proposed subsection (d)(2) by suggesting that regulation by floating reference to a federal standard would be an impermissible delegation of the commission's rulemaking authority. In support of its assertion, SWBT cited various caselaw rulings. AT&T commented that with the exception of one citation, SWBT's caselaw examples exist in jurisdictions outside Texas and offer no precedent value for the issue at hand. AT&T contended that the key issue was the meaning and purpose behind the requirement of ILECs to unbundle their networks, at a minimum, to the extent ordered by the FCC. AT&T supported the commission's proposed rule because the commission has jurisdiction over telecommunications utilities and the means necessary to make telecommunications competitive, and the authority to develop a competitive telecommunications market as requested by the legislature. The commission disagrees with SWBT that the floating reference violates PURA and APA. With regard to PURA 95, the statute expressly requires ILECs to unbundle to the extent ordered by the FCC. The rule, as proposed and adopted, best effectuates the intent of the Legislature. There is no provision in the APA or Texas caselaw specifically prohibiting construction of a subsection as proposed and adopted here. The commission notes that adequate notice has been provided and all the procedural requirements under APA have been met in this rulemaking project. Also, the commission remains free to reconsider and amend or repeal the rule if interstate regulation departs from the commission's intrastate policies. Furthermore, nothing in this rule precludes SWBT from petitioning the commission to amend this rule in the future if it believes that any unbundling requirements imposed on it pursuant to this rule violates its due process rights under APA. The commission believes that in adopting this rule it is acting consistently with and implementing the policies and directives of its statutory authority. The commission therefore retains proposed subsection (d)(2). SWBT argued that if the proposed subsection (d)(2) relating to future FCC unbundling requirements is adopted, there will be no need for the commission to consider further unbundling pursuant to sec.3.452(b). The commission disagrees with SWBT's comment and notes that a separate project (Project No. 14959) has been instituted to consider further unbundling of ILEC network/services. The commission believes that further unbundling should, at a minimum, be consistent with future FCC unbundling requirements and may address unbundling beyond that ordered by the FCC. OPC commented that proposed subsection (d)(2)(A) [renumbered as subsection (d)(2)] allows the FCC to preempt the jurisdiction of the commission in determining the amount of further unbundling necessary on intrastate services. OPC asserted that PURA 95 sec.3.452(a) requires that FCC ordered unbundling serve as the minimum level of unbundling. OPC commented that the commission should retain its jurisdiction to determine the amount of further unbundling and the rates, terms, and conditions in which this should occur. In its reply comments, AT&T concurred with OPC that FCC-ordered unbundling should be the minimum that is required of Texas ILECs. AT&T stated that there is nothing in the proposed rule which preempts the commission from ordering further unbundling. AT&T further commented that there is nothing in the proposed rule which mandates that future unbundling should only occur to the extent ordered by the FCC. AT&T supported OPC's suggestion that the commission revise the proposed rule to delineate the commission's jurisdiction to determine the future levels, terms, conditions of unbundling and pricing of unbundled elements. In its reply comments, SWBT characterized OPC's comments as consistent with its own position that the intent of this rule is to address the requirements of the minimum level of unbundling which does not include future FCC unbundling requirements. SWBT added that future requirements should be addressed through evidentiary hearings. The commission agrees with OPC and AT&T that the rule should contain language expressly reserving jurisdiction to address unbundling issues that might go beyond minimum FCC requirements. Proposed subsection (d)(1)(A) and (d) (2)(A) have been revised accordingly and are renumbered as subsection (d)(1) and (d)(2) respectively. The commission rejects SWBT's suggestion that future unbundling pursuant to FCC- orders should be addressed through evidentiary hearings. The commission notes that minimum unbundling requirements under this rule encompasses both current and future FCC unbundling requirements as contemplated by PURA 95 sec.3.452(a), which does not require an evidentiary hearing addressing the need for such unbundling. The commission agrees that an evidentiary hearing may be required for further unbundling pursuant to sec.3. 452(c). As stated supra, further unbundling is the subject of Project No. 14959. Proposed subsection (d)(2)(B) required that, in the event an ILEC having interstate tariffs in effect and serving one million or more access lines did not file tariffs in compliance with the requirements of this rule, a CTU or enhanced service provider could request such an ILEC to unbundle its network/services. AT&T commented that the provision in proposed subsection (d) (2)(B) placed the burden on a CTU to make a bona fide request of a large ILEC before there is any triggering of the ILEC's duty to comply with this subsection. AT&T stated that proposed subsection (d)(2)(B) should be deleted in its entirety. It is not the commission's intent to place the burden on the requesting CTU to make a bona-fide request to an ILEC before the duty to unbundle is triggered. However, the commission agrees with AT&T that the language may be misinterpreted to have that effect. The commission deletes the language about bona fide requests in proposed subsection (d)(2)(B) to address AT&T's concern. Proposed subsection (e) set forth the costing and pricing standards for services unbundled in compliance with this rule. Proposed subsection (e)(1) specified that the cost standard for unbundled services would be based on the long run incremental cost (LRIC) of providing the service. Proposed subsection (e)(1)(B) [renumbered as subsection (e)(1)(D)] specified that the LRIC standard would not apply if the ILEC proposed rates that are the same as the rates in effect for the carrier's interstate provision of the same, or substitutable service if the ILEC adopted rates of another ILEC. AT&T opined that this section is ambiguous because there is no definition as to what would qualify as a "substitutable" service, and that what an ILEC may consider to be substitutable may vary greatly from what a purchasing CTU would consider to be substitutable. AT&T suggested revising proposed subsection (e)(1)(B) with language that refers to a "same or equivalent" unbundled service which would clarify the meaning of the rule. In its reply comments, SWBT opposed AT&T's suggestion because adding the phrase "same or equivalent" offers no flexibility to discuss what constitutes "substitutable" service. The commission agrees with AT&T that the term "substitutable" can be open to interpretation and subject to potential abuse. The commission has revised proposed subsection (e)(2)(A) [renumbered as subsection (e)(1)(D)] deleting the term. The commission also deletes the term in proposed subparagraphs (A) and (C) of subsection (e)(2). Furthermore, the commission rearranges and makes minor modifications to subsection (e)(1) for clarification purposes. Proposed subsection (e)(2) set forth the pricing standards for ILECs for services unbundled in compliance with this rule. Proposed subsection (e)(2)(A) would allow an ILEC to propose rates that are at parity with the rates in effect for the carrier's interstate provision of the same, equivalent or substitutable service. OPC asserted that the commission may be exceeding its statutory authority by allowing rate changes for ILECs simply because of parity that may exist at the FCC for equivalent services. OPC wanted the commission to identify its authority to allow ILECs to propose rates without cost justification if those rates are identical to the ILECs' interstate rates for the same service. PURA 95 sec.3.452 expressly requires ILECS to unbundle to the extent ordered by the FCC. The commission notes that to the extent the unbundled service offered on an intrastate and interstate basis is the same or equivalent, the costs for providing the service on an intrastate basis should not be materially different. The commission does not believe that detailed cost justification of rates proposed at parity with interstate rates is necessary because the interstate cost studies used to determine those rates have been reviewed by the FCC and are available for examination. The commission also notes that other provisions of PURA 95 (e.g. sec.3.458) allow an ILEC to adopt the rates of a larger ILEC without cost justification. The commission therefore retains proposed subsection (e)(2)(A) but makes minor modifications for clarification purposes. Proposed subsection (e)(2)(B) authorized ILECs not subject to the LRIC methodology provisions of Substantive Rule 23.91 to propose rates, without cost justification, that are the same as the rates in effect for the carrier's interstate provision of the same service or adopt the rates of another ILEC that are developed pursuant to the requirements of this section. OPC requested clarification of the intent of this section's language, "pursuant to the requirements of this section." The commission clarifies that the reference to "this section" in subsection (e)(2)(B) is intended to refer to sec.23.99. No modification is made in response to OPC's comments. However, the commission makes minor modifications to subsection (e)(2)(B) for clarification purposes. Proposed subsection (e)(2)(C) outlines the pricing provisions of unbundled network/services. Specifically, it set forth various requirements if an ILEC proposes rates that are not at parity with the rates in effect for the carrier's interstate provision of equivalent or substitutable service or does not adopt the rates of another ILEC. SWBT took exception to the requirement in proposed subsection (e)(2)(C)(i) that services be offered at the same price system-wide. It contended that such a requirement is in conflict with the pricing flexibility offered to ILECs electing incentive regulation under PURA 95. In response to SWBT's comment, the commission deletes subsection (e)(2)(C) (i). The commission believes that this issue should not be decided in this rulemaking proceeding; rather, it should be resolved in subsequent proceedings of the commission. Proposed subsection (e)(2)(C)(iii) [renumbered as subsection (e)(2)(C)(ii)] set forth one of the pricing guidelines for an ILEC that proposes rates which are not at parity with its interstate rates or does not adopt the rates of another ILEC. Specifically, it establishes a rebuttable presumption that the rate of an unbundled component is reasonable if the sum of the rates of the new unbundled components is equal to the price of the original bundled service and if the ratio of the rate of each unbundled component to its LRIC is the same for each unbundled component. OPC posited that the commission lacks the authority to allow an ILEC to set arbitrary prices for an unbundled element as long as the sum of the unbundled rate equals the sum of the bundled rate. OPC asserted that such action would constitute price-based costing rather than cost-based pricing and that allowing ILECs to establish price-based elements defeats the purpose of cost-based pricing. OPC further contended allowing ILECs to skew the rates so that bottleneck facilities are over-priced creates an unfair competitive advantage for the ILECs and impedes competition and choice for consumers. In its reply comments, SWBT responded to OPC's arguments about price based costing and bottleneck facilities by stating that: 1) this rule does not dictate price or rates of unbundled elements; 2) the language of this subsection only allows for a rebuttable presumption if certain conditions are met; 3) in the case of ILECs electing incentive regulation, prices/rates of unbundled components will be established under basket guidelines; and 4) SWBT has filed a tariff that permits the resale of local exchange service at a discounted rate which should address any concerns about the existence of bottle neck facilities. The commission disagrees with OPC. The commission's intent in establishing a price guideline is to ensure that unbundled elements that are bottleneck facilities do not bear a disproportionate share of the joint and common costs. The rule clearly provides that the rate of each unbundled component must be related to its LRIC. Thus, the rule considers the cost of each component in the rate for the component, resulting in cost- based rates. Further, pursuant to PURA 95, the commission has the discretion to determine an appropriate rate design and may consider factors other than cost and adjusted value of property in establishing just and reasonable rates for services. Also, the pricing of unbundled services must equal (or be less than) the sum of the previously bundled rate which was determined by the commission in a previous project or docket to comply with state law and commission rules. Finally, the commission would join SWBT in pointing out that the provision referenced by OPC only creates a rebuttable presumption of reasonableness. Upon proper showing, such presumption may be overturned and different rates established. The commission finds that this provision is within its authority to adopt rules relating to rate design and declines to delete proposed subsection (e)(2)(C)(iii) [renumbered as subsection (e)(2)(C)(ii)]. However, the commission believes it is appropriate to add clause (iii) to subsection (e)(2)(C) which prohibits ILECs from proposing rates and terms that are unreasonably preferential, prejudicial, or discriminatory. This should adequately address OPC's concerns. SWBT stated that the pricing guidelines under proposed subsection (e)(2)(C) (iii) would require uniform percentage overhead loadings on all unbundled components. It argued that such uniform loadings are inefficient and do not reflect market conditions. The commission rejects SWBT's argument and notes that the language in proposed subsection (e)(2)(C)(iii) seeks to ensure that unbundled components with an inelastic demand in the market do not bear a disproportionate share of joint and common costs compared to unbundled components that have an elastic demand in the market. Therefore, no modification is made to proposed subsection (e)(2)(C)(iii); however it is renumbered as subsection (e)(2)(C)(ii) . SWBT argued that the commission's ability to establish cost-based rates for unbundled components under proposed subsection (e)(2)(C)(iii) [renumbered as subsection (e)(2)(C)(ii)] is limited for an ILEC electing incentive regulation, under PURA 95 Subtitle H. SWBT argued that under incentive regulation, unbundled components are categorized into a basket system of pricing and various forms of pricing flexibility are applicable. SWBT further argued that the commission must set rates for unbundled elements on a revenue-neutral basis. In its reply comments, AT&T disagreed with SWBT and referred to PURA 95 Subtitle J, Competitive Safeguards, to support its argument that incentive regulation does not prevent the commission from enforcing competitive safeguards, including unbundled rate provisions. AT&T replied that SWBT provides no legal support for its hypothesis that the commission may not have the authority to enforce minimum unbundling requirements on a company that has elected incentive regulation under PURA 95. PURA 95 sec.3.452 specifies that an ILEC shall, at a minimum, unbundle its network to the extent ordered by the FCC but makes no exceptions for those ILECs electing incentive regulation. AT&T also replied that if any entity electing incentive regulation is automatically exempt from the unbundling rule, there would be no need for the language of PURA 95 sec.3.452(d) authorizing the commission to assign the unbundled components to the appropriate basket according to the purposes and intents of these baskets. AT&T concluded its reasoning with support from PURA 95 Subtitle J, Competitive Safeguards, sec.3.451(b) which states that sec.3. 352(d) of PURA 95 does not prevent the commission from enforcing Subtitle J. AT&T also argued that subsection (e)(2) authorized several methods for establishing intrastate unbundled rates that are lawful under PURA including parity with interstate rates, parity with another ILECs unbundled rates, or an unbundled rate design with components that sum to the rate of the previously bundled service offering. The commission rejects SWBT's assertion that the commission's ability to impose the unbundling requirements and more specifically pricing guidelines is limited in the case of an ILEC electing incentive regulation. The commission notes that PURA 95 sec.3.452 (d) requiring assignment of unbundled components to appropriate baskets specifically applies to ILECs electing incentive regulation. Furthermore, the pricing guideline in proposed subsection (e)(2)(C) (iii) [renumbered as subsection (e)(2)(C)(ii)] does not prescribe specific rates but simply ensures that rates for unbundled components cover costs and provide a fair contribution to joint and common costs. Moreover, proposed subsection (e)(2)(C)(i) mandating that ILECs offer the same system-wide rates is deleted which should address SWBT's concerns. The commission believes that the pricing guidelines under proposed subsection (e)(2)(C)(iii) are consistent with the pricing flexibility offered to ILECs electing incentive regulation and therefore retains proposed subsection (e)(2)(C)(iii) [renumbered as subsection (e)(2)(C)(ii)]. Under proposed subsection (e)(2)(D), rates based upon new LRIC studies would be subject to the pricing rulemaking to the same extent as any other service. AT&T proposed adding language to this subsection to make it clear that once the guidelines and terms of the pricing rulemaking referred to in Substantive Rule 23.91(p) are established, they shall supersede other presumptions and requirements specified in the pricing subsection of this rule so that the unbundled rates are in fact, cost-based. SWBT responded that AT&T's suggestion would preclude parties from arguing about the content of the pricing rule, or its effect or applicability to services unbundled pursuant to this rule. The commission agrees with SWBT in that AT&T's comment presumes that the pricing rule will automatically change the rates of services subject to this rule. The commission believes that AT&T's suggested change is unnecessary. The current language will ensure that any changes in rates of services subject to this rule, if determined to be appropriate under the pricing rule, when adopted, will supersede the rates established under this rule. AT&T supported the language in proposed subsection (f) which required that ILECs electing incentive regulation, under PURA 95 Subtitle H, include in their compliance tariff a proposal for assigning the unbundled components to an appropriate basket. AT&T proposed that an ILEC be required to submit in its compliance tariff a rationale supporting the proposed basket. The commission believes that AT&T's suggestion is appropriate and therefore adds specific language to proposed subsection (f) to address AT&T's comment. Proposed subsection (g) set forth the filing requirements. Proposed subsections (g)(1) and (g)(2) required both initial filings and revised tariff filings to be filed within 60 days. AT&T proposed clarifying the language by distinguishing initial unbundling intrastate tariff applications from revisions to effective intrastate tariffs. AT&T suggested that revisions to intrastate filings should be filed within 15 days of the effective date of interstate filings. AT&T contended that revising and updating intrastate tariffs to mirror revisions made to interstate tariffs should require less time and effort than preparing the initial unbundling tariff application. AT&T also noted that its suggestion is consistent with the time frame for revisions authorized by the commission in sec.23.92 regarding expanded interconnection. The commission agrees with AT&T that subsection (g) should distinguish between initial filings and revisions to such filings and that the time frame for revisions should be shortened. The commission, therefore, deletes the reference to revisions to intrastate tariffs in proposed subsection (g)(2) and adds subsection (g)(5) to address such revisions. Under new subsection (g)(5), revisions to intrastate filings have to be made within 30 days of the effective date of the corresponding interstate filings and the proposed effective date of such filings shall be not later than 30 days after the filing date, unless suspended. In addition, the commission notes that the concept contained in proposed subsection (g)(4) relating to filings for ILECs serving fewer than one million access lines is now addressed in subsections (g) (3) and (g)(4). Proposed subsection (g)(1) required an ILEC serving one million or more access lines to file its initial unbundled tariff within 60 days of the effective date of the section. For ILECs serving one million or more access lines, AT&T proposed changing the initial tariff filing requirement from 60 days to 30 days. AT&T remarked that ILECs with effective interstate tariffs for unbundled elements should be able to propose intrastate tariffs within 30 days of the effective date of this rule. In its reply comments, SWBT rejected AT&T suggestion that the time for ILECs to file tariff amendments be reduced from 60 to 30 days. SWBT implied that a shorter filing deadline imposes a greater burden on ILECs that are already required to file numerous tariffs. The commission believes that 60 days is a reasonable time for ILECS serving one million or more access lines to file tariffs. Proposed subsection (g)(1) will be retained. Under proposed subsection (g)(3), an ILEC serving one million or more access lines would be required to unbundle its network/services within 60 days from the receipt of the bona fide request. AT&T commented that proposed subsection (g)(3) allows ILECs to delay compliance with the unbundling requirements until it receives a bona fide request. AT&T further commented that proposed subsection (g)(3) imposes a burden on CTUs to make a bona fide request before an ILEC is required to comply with this section of the rule. AT&T recommended that proposed subsection (g)(3) be deleted in its entirety. In its reply comments, SWBT asserted that the bona fide request mechanism should be maintained because it parallels the unbundling requirements of ONA. To be consistent with the removal of language about bona fide requests in proposed subsection (d)(2)(B), the commission also deletes proposed subsection (g)(3) in its entirety. GTE questioned the requirement in proposed subsection (g)(3) which required an ILEC serving one million or more access lines to respond to a new service request within 60 days when current FCC guidelines allow response within 120 days. GTE suggested a revision to proposed subsection (g)(3) allowing use of GTE's New Service Request Form which has been reviewed by the FCC and coincides with the 120-day response time authorized by the FCC. SWBT concurred with GTE's comments and stated that federal and state rules should be consistent with respect to timeframes for responses to bona fide requests. In its reply comments, AT&T commented that GTE's request for a 120-day review process should be rejected. AT&T replied that GTE's current request and review period for any interstate unbundling should be sufficient time for developing any necessary intrastate cost studies and tariff changes. The commission finds it unnecessary to modify proposed subsection (g)(3) in response to GTE's comments because proposed subsection (g)(3) is deleted in its entirety in response to comments previously mentioned and addressed. Proposed subsection (h)(2)(F) required that proposed rates for unbundled services recover the annual long run incremental costs as well as provide a contribution to joint and common costs. AT&T recommended deleting the language which requires that rates for unbundled services provide a contribution to joint and common costs because it presupposes the outcome of the pricing rule. AT&T instead suggested modifying the language to require that proposed rates generate annual revenues that recover at least the annual long run incremental costs. SWBT disagrees with AT&T's suggestion and argued that unbundling should not be a regulatory requirement where the new entrant is subsidized by the ILECs. The commission disagrees with AT&T that the proposed language regarding contribution to joint and common costs presupposes the outcome of the pricing rule. The commission believes that it is appropriate for the purchasers of the unbundled service to pay for the costs of the unbundled service and pay a reasonable contribution to joint and common costs. The issue of what constitutes a "reasonable" contribution to joint and common costs will be determined during the compliance tariff review process. The commission believes that the language regarding contribution to joint and common costs is appropriate and therefore, declines to adopt AT&T's recommendation. Proposed subsection (i)(1) set forth guidelines for the commission's processing of applications. OPC suggested amending the language in this subsection to either delete automatic docketing by request of the ILEC or to allow any party to docket by request. OPC argued that if any party raised an issue in controversy, the application should be docketed. In its reply comments, SWBT asserted that implementation of OPC's suggestion would interfere with the due process rights of the ILEC. SWBT replied that circumstances could arise where an ILEC would want to request docketing of an application. SWBT suggested that automatic docketing at the request of a competitor of an ILEC could lead to procedural abuse and needless litigation. The commission notes that subsection (i)(1) allows the presiding officer, for good cause, to determine at any point during the administrative review that the application should be docketed. Furthermore, under subsection (i)(2), the presiding officer must docket the application if it determines that one or more of the requirements not waived in the rule have not been met. To the extent the presiding officer makes such a determination based on the input from all intervening parties, the commission believes that subsection (i) adequately addresses OPC's concern. SWBT opined that local transport restructure (LTR) is not unbundling and ILECs should not be required to unbundle local transport (a component of switched access service) in this rule. It commented that LTR goes beyond the unbundling of a service by removing usage sensitive rate elements and replacing them with flat rate elements. SWBT contended that PURA 95 sec.3.352(d) prohibits the commission from reducing the rates for switched access services for any electing company before the expiration of the cap on basic network services. It stated that the commission cannot apply the competitive safeguards under PURA 95 Subtitle J through a form of unbundling or otherwise that would reduce the rates and therefore the revenues for switched access services. AT&T refuted SWBT's assertion regarding LTR. It stated that LTR, together with expanded interconnection, satisfies the fundamental purpose of unbundling-to permit competitors to purchase from the ILECs those components of the unbundled switched access network as necessary and to self-provide or obtain from other competitors of the ILEC other components of the network. AT&T also pointed out that LTR has already been addressed in sec.23.23(d)(4)(F). The commission does not specifically address LTR in this rule because it has already been addressed in Substantive Rule sec.23.23(d). However, the commission disagrees with SWBT's analysis of the statutory provisions as they apply to switched access rates and unbundling. The commission believes that the specific language in PURA 95 sec.3.451(b) under Subtitle J, Competitive Safeguards, takes precedence over the general prohibition in PURA 95 sec.3. 352(d) dealing with the reduction of switched access rates for electing companies. PURA 95 sec.3.451(b) states that "Section 3.352(d) of this Act does not prevent the Commission from enforcing this subtitle." "This subtitle" refers to Subtitle J, Competitive Safeguards, including sec.3.452(a) which mandates unbundling to the extent ordered by the FCC. The LTR mandated in sec.23.23(d) is not in conflict with the directive of sec.3.452(a). Moreover, LTR in sec.23.23(d) as adopted by the commission is designed to be revenue neutral and is consistent with sec.3.451(b) while minimizing conflict with sec.3. 352(d). However, the commission notes that unbundling under sec.3.452(a) is not required to be revenue neutral and similarly, the unbundling mandated in this rule is not designed to be revenue neutral. Parties at the public hearing on the proposed rule also raised concerns that sections of PURA 95, and possibly the rule as proposed, may be preempted by provisions of the Federal Telecommunications Act of 1996 (the Act). The commission has determined: 1) that PURA 95 sec.1.404 authorizes the commission to determine if a federal statute preempts its controlling statute and directs the commission to harmonize any perceived differences between state and federal law, when possible; 2) that the Act provides only for express preemption of state law, rather than implied preemption of such; and 3) that the Act does not preempt PURA 95 sec.3.452(a). Therefore, the Act does not prevent the commission from promulgating rules pursuant to PURA 95 sec.3.452. In adopting this section, the commission makes other minor modifications for the purposes of clarifying its intent. All comments, including any not specifically referenced herein, were fully considered by the commission. The section is adopted under the Texas Civil Statutes, Article 1446c-0, sec.1.101, which provides the commission with the authority to make and enforce rules reasonably required in the exercise of its powers and jurisdiction; sec.3. 051 which authorizes the commission to adopt rules, policies, and procedures to protect the public interest and to provide equal opportunity to all telecommunications utilities in a competitive marketplace; and sec.3.452(a), which requires the commission to adopt rules for unbundling to the extent ordered by the FCC. Cross Index to Statutes: Texas Civil Statutes, Article 1446c-0. sec.23.99. Unbundling. (a) Purpose. The purpose of this section is to implement the Public Utility Regulatory Act of 1995 (PURA 95) sec.3.452(a) which requires an incumbent local exchange company (ILEC), at a minimum, to unbundle its network to the extent ordered by the Federal Communications Commission (FCC). (b) Application. (1) The provisions of this section apply, as of its effective date, to each ILEC that serves one million or more access lines. (2) The provisions of this section apply upon a bona fide request to each ILEC that serves 31,000 or more access lines but fewer than one million access lines. (3) The provisions of this section apply, after September 1, 1998, upon a bona fide request to each ILEC that serves fewer than 31,000 access lines. (c) Definitions. The following words and terms when used in this section, shall have the following meanings, unless the context clearly indicates otherwise. (1) Bona fide request-A written request to an ILEC from a certificated telecommunications utility (CTU) as that term is defined in sec.23. 3 of this title (relating to Definitions) or an enhanced service provider, requesting that the ILEC unbundle its network/services to the extent ordered by the FCC. The request should indicate an intent to purchase the service subject to the purchaser being able to obtain acceptable rates, terms, and conditions. (2) Enhanced Service Provider-A company that offers services over transmission facilities that utilize computer-based processing applications to provide the customer with value-added telephone services. (3) Incumbent Local Exchange Company (ILEC)-A local exchange company that has a certificate of convenience and necessity on September 1, 1995. (4) Open Network Architecture-The overall design of an ILEC's network facilities and services to permit all users of the network, including the enhanced services operations of an ILEC and its competitors, to interconnect to specific basic network functions on an unbundled and non- discriminatory basis. (5) Signalling for tandem switching-The carrier identification code (CIC) and the OZZ code, or equivalent information needed to perform tandem switching functions. The CIC identifies the interexchange carrier and the OZZ digits identifies the call type and thus the interexchange carrier trunk to which traffic should be routed. (6) Unbundling-The disaggregation of the ILEC's network/service to make available the individual network functions or features or rate elements used in providing an existing service. (d) Unbundling requirements. (1) Unbundling pursuant to current FCC requirements. Each ILEC that is subject to this section shall unbundle as specified in subparagraphs (A)-(B) of this subparagraph. An ILEC with interstate tariffs in effect shall unbundle its network/services under the same terms and conditions, except for price, as it unbundles its interstate services, unless ordered otherwise by the commission. The ILEC shall also not impose a charge or rate element that is not included in its interstate tariffs for these unbundled rate elements. Nothing herein precludes the commission from requiring further unbundling of local exchange company services, including the services unbundled pursuant to this paragraph. (A) The ILEC's network shall be unbundled to the extent ordered by the FCC in compliance with its Open Network Architecture requirements; and (B) Signalling for tandem switching shall be unbundled to the extent ordered by the FCC in compliance with CC Docket Number 91-141, Third Report and Order, In the Matter of Expanded Interconnection with Local Telephone Company Facilities, Transport Phase II. (2) Unbundling pursuant to future FCC requirements. An ILEC shall unbundle its network/services as defined in subsection (c)(6) of this section for intrastate services to the extent ordered, in the future, by the FCC for interstate services. An ILEC with interstate tariffs in effect shall unbundle these services under the same terms and conditions, except for price, as it unbundles its interstate services, unless ordered otherwise by the commission. The ILEC shall also not impose a charge or rate element that is not included in its interstate tariffs for unbundling. Nothing herein precludes the commission from requiring further unbundling of local exchange company services, including the services unbundled pursuant to this paragraph. (e) Costing and pricing of services in compliance with this section. (1) Cost Standard. Services unbundled in compliance with this section shall be subject to the following cost standard. (A) The cost standard for unbundled services shall be the long run incremental costs (LRIC) of providing the service. (B) Any ILEC subject to sec.23.91 of this title (relating to Long Run Incremental Cost Methodology for LEC Services) shall file LRIC studies pursuant to that rule, by December 31, 1996, for unbundled components specified in subsection (d)(1) of this section. (C) For any ILEC that is subject to sec.23.91 of this title, the cost standard for unbundled services required under subsection (d)(2) of this section shall be the long run incremental costs pursuant to sec.23.91 of this title. (D) The long run incremental cost standard shall not apply if the ILEC proposes rates that are the same as the rates in effect for the carrier's interstate provision of the same or equivalent unbundled service or if the ILEC adopts rates of another ILEC pursuant to paragraph (2)(B) of this subsection. (2) Pricing Standard. Services unbundled in compliance with this section shall be subject to the following pricing standard. (A) Any ILEC may propose rates, without cost justification, that are at parity with the rates in effect for the carrier's interstate provision of the same or equivalent unbundled service. The ILEC shall amend its intrastate rates, terms and conditions to be consistent with subsequent revisions in its interstate tariffs providing for unbundling pursuant to filing requirements established in subsection (g)(5) of this section. (B) In addition to the provision in subparagraph (A) of this paragraph, ILECs that are not subject to sec.23.91 of this title may adopt the rates of another ILEC that are developed pursuant to the requirements of this section. (C) If an ILEC proposes rates that are not at parity with the rates in effect for the carrier's interstate provision of the same or equivalent unbundled service or does not adopt the rates of another ILEC pursuant to subparagraph (B) of this paragraph, the following requirements shall apply to any service approved under this section: (i) Unless waived or modified by the presiding officer, the service shall be offered in every exchange served by the ILEC, except exchanges in which the ILEC's facilities do not have the technical capability to provide the service. (ii) If the sum of the rates of the new unbundled components is equal to the price of the original bundled service and if the ratio of the rate of each unbundled component to its LRIC is the same for each unbundled component, there shall be a rebuttable presumption that the rate of an unbundled component is reasonable. (iii) The proposed rates and terms of the service shall not be unreasonably preferential, prejudicial, or discriminatory, subsidized directly or indirectly by regulated monopoly services, or predatory or anticompetitive. (D) Rates based upon the new LRIC cost studies required under paragraph (1)(B) of this subsection shall be subject to the pricing rulemaking referred to in sec.23.91 (p) of this title to the same extent as any other service offered by an ILEC subject to the pricing rule. (f) Basket Assignment. An ILEC electing incentive regulation under subtitle H of PURA shall, in its compliance tariff filed pursuant to subsection (g) of this section, include a proposal and rationale for assigning the unbundled components to the appropriate basket. (g) Filing Requirements. (1) Initial filing to implement subsection (d)(1) of this section in effect for ILECs serving one million or more access lines. An ILEC serving one million or more access lines shall file initial tariff amendments to implement the provisions of subsection (d)(1) of this section not later than 60 days from the effective date of this section. The proposed effective date of such filings shall be not later than 30 days after the filing date, unless suspended. Tariff revisions filed pursuant to this subsection shall not be combined in a single application with any other tariff revision. (2) Filings to comply with subsection (d)(2) of this section for ILECs serving one million or more access lines. An ILEC serving one million or more access lines shall file tariff amendments to implement the provisions of subsection (d)(2) of this section, within 60 days of the effective date of its interstate tariff providing for unbundling. The proposed effective date of such filings shall be not later than 30 days after the filing date, unless suspended. Tariff revisions filed pursuant to this subsection shall not be combined in a single application with any other tariff revision. (3) Filings to implement subsection (d)(1) and (2) of this section for ILECs serving 31,000 or more access lines but fewer than one million access lines. If an ILEC serving 31,000 or more access lines but fewer than one million access lines receives a bona fide request, it shall unbundle its network/services pursuant to the bona fide request within 90 days from the date of receipt of the bona fide request or shall have the burden of demonstrating the reasons for not unbundling pursuant to the bona fide request. (4) Filings to implement subsection (d)(1) and (2) of this section for ILECs serving fewer than 31,000 access lines. If an ILEC serving fewer than 31, 000 access lines receives a bona fide request, after September 1, 1998, it shall unbundle its network/services pursuant to the bona fide request within 90 days from the date of receipt of the bona fide request or shall have the burden of demonstrating the reasons for not unbundling pursuant to the bona fide request. (5) Filings to comply subsection (e)(2)(A) of this section. An ILEC proposing rates pursuant to subsection (e)(2)(A) shall file tariff amendments to implement the revisions in its interstate tariffs providing for unbundling, within 30 days of the effective date of its interstate tariff providing for unbundling. The proposed effective date of such filings shall be not later than 30 days after the filing date, unless suspended. Tariff revisions filed pursuant to this subsection shall not be combined in a single application with any other tariff revision. (h) Requirements for notice and contents of application in compliance with this section. (1) Notice of Application. The presiding officer may require notice to be provided to the public as required by Subchapter D of the Commission's Procedural Rules. The notice shall include, at a minimum, a description of the service, the proposed rates and other terms of the service, the types of customers likely to be affected if the service is approved, the probable effect on ILEC's revenues if the service is approved, the proposed effective date for the service, and the following language: Persons who wish to comment on this application should notify the commission by specified date, ten days before the proposed effective date. Requests for further information should be mailed to the Public Utility Commission of Texas, (insert the commission's current address), or you may call the Public Utility Commission's Public Information Office at (insert the commission's current telephone numbers), or (insert current commission telephone number for text telephone teletypewriter for the deaf). (2) Contents of application for an ILEC serving one million or more access lines that is required to comply with subsection (g) (1)-(2) and (g)(5) of this section An ILEC shall request approval of an unbundled service by filing an application that complies with the requirements of this section. In addition to copies required by other commission rules, one copy of the application shall be delivered to the Legal Division of the Commission's Office of Regulatory Affairs and one copy to the Office of Public Utility Counsel. The application shall contain the following information: (A) a description of the proposed service and the rates, terms and conditions, under which the service is proposed to be offered and a demonstration that the proposed rates, terms and conditions are in conformity with the requirements in subsections (d), (e), and (f) of this section, as applicable; (B) a statement detailing the type of notice, if any, the ILEC has provided or intends to provide to the public regarding the application and a brief statement explaining why the ILEC's notice proposal is reasonable; (C) a copy of the text of the notice, if any; (D) a long run incremental cost study supporting the proposed rates, if the rates are not at parity with the carrier's interstate rates; (E) detailed documentation showing that the proposed service is priced above the long run incremental cost of such service, including all workpapers and supporting documentation relating to computations or assumptions contained in the application, if the rates are not at parity with the carrier's interstate rates; (F) projection of revenues, demand, and expenses demonstrating that in the second year after the service is first offered, the proposed rates will generate sufficient annual revenues to recover the annual long run incremental costs of providing the service, as well as a contribution for joint and/or common costs, if the rates are not at parity with the carrier's interstate rates; (G) explanation that the proposed rates and terms of the service are not unreasonably preferential, prejudicial, or discriminatory, subsidized directly or indirectly by regulated monopoly services, or predatory or anticompetitive; (H) the information required by sec.23.57 of this title (relating to Telecommunications Privacy); and (I) any other information which the ILEC wants considered in connection with the commission's review of its application. (3) Contents of application for an ILEC serving fewer than one million access lines that is required to comply with subsection (g)(3)-(4) and (5) of this section. An ILEC shall file with the commission an application complying with the requirements of this section. In addition to copies required by other commission rules, one copy of the application shall be delivered to the Legal Division of the Commission's Office of Regulatory Affairs and one copy shall be delivered to the Office of Public Utility Counsel. The application shall contain the following: (A) contents of application required by paragraph (2)(A), (B), (C), (H) and (I) of this subsection; (B) contents of application required by paragraph (2)(D), (E), (F) and (G) of this subsection, if the rates are not at parity with the carrier's interstate rates or the rates of another ILEC; (C) a description of the proposed service(s) and the rates, terms, and conditions under which the service(s) are proposed to be offered and an affidavit from the general manager or an officer of the ILEC approving the proposed service; (D) a notarized affidavit from a representative of the ILEC affirming that the rates are just and reasonable and are not unreasonably preferential, prejudicial, or discriminatory; subsidized directly or indirectly by regulated monopoly services; or predatory, or anticompetitive; and (E) projections of the amount of revenues that will be generated by the proposed service. (i) Commission processing of application (1) Administrative review. An application considered under this section may be reviewed administratively unless the ILEC requests the application be docketed or the presiding officer, for good cause, determines at any point during the review that the application should be docketed. (A) The operation of the proposed rate schedule may be suspended for 35 days after the effective date of the application. The effective date shall be according to the requirements in subsection (g) of this section. (B) The application shall be examined for sufficiency. If the presiding officer concludes that material deficiencies exist in the application, the applicant shall be notified within 10 working days of the filing date of the specific deficiency in its application, and the earliest possible effective date of the application shall be no less than 30 days after the filing of a sufficient application with substantially complete information as required by the presiding officer. Thereafter, any time deadlines shall be determined from the 30th day after the filing of the sufficient application and information or from the effective date if the presiding officer extends that date. (C) While the application is being administratively reviewed, the commission staff and the staff of the Office of the Public Utility Counsel may submit requests for information to the ILEC. Six copies of all answers to such requests for information shall be filed with Central Records and one copy shall be provided to the Office of Public Utility Counsel within 10 days after receipt of the request by the ILEC. (D) No later than 20 days after the filing date of the sufficient application, interested persons may provide to the commission staff written comments or recommendations concerning the application. The commission staff shall and the Office of Public Utility Counsel may file with the presiding officer written comments or recommendations concerning the application. (E) No later than 35 days after the effective date of the application, the presiding officer shall issue an order approving, denying, or docketing the ILEC's application. (2) Approval or denial of application. The application shall be approved by the presiding officer if the proposed tariff meets the requirements in this section. If, based on the administrative review, the presiding officer determines, that one or more of the requirements not waived have not been met, the presiding officer shall docket the application. (3) Standards for docketing. The application may be docketed pursuant to sec.22.33(b) of the commission's Procedural Rules. (4) Review of the application after docketing. If the application is docketed, the operation of the proposed rate schedule shall be automatically suspended to a date 120 days after the applicant has filed all of its direct testimony and exhibits, or 155 days after the effective date, whichever is later. Affected persons may move to intervene in the docket, and the presiding officer may schedule a hearing on the merits. The application shall be processed in accordance with the commission's rules applicable to docketed cases. (5) Interim rates. For good cause, interim rates may be approved after docketing. If the service requires substantial initial investment by customers before they may receive the service, interim rates shall be approved only if the ILEC shows, in addition to good cause, that it will notify each customer prior to purchasing the service that the customer's investment may be at risk due to the interim nature of the service. (j) Commission processing of waivers. Any request for modification or waiver of the requirements of this section shall include a complete statement of the ILEC's arguments and factual support for that request. The presiding officer shall rule on the request expeditiously. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's authority. Issued in Austin, Texas, on May 14, 1996. TRD-9606656 Paula Mueller Secretary of the Commission Public Utility Commission of Texas Effective date: June 4, 1996 Proposal publication date: December 15, 1995 For further information, please call: (512) 458-0100 TITLE 22. EXAMINING BOARDS Part XVII. Texas State Board of Plumbing Examiners Chapter 361. Administration 22 TAC sec.361.1 The Texas State Board of Plumbing Examiners adopts amended sec.361.1, concerning Definitions, without changes to the proposed text as published in the February 20, 1996 issue of the Texas Register (21 TexReg 1341). This rule is being amended to add the definitions for the phrases Pocket Card, Plumbing Company and Responsible Master Plumber. The rule will provide the public with a clearer understanding of the phrases Pocket Card, Plumbing Company and Responsible Master Plumber. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 6243-101, which provide the Texas State Board of Plumbing Examiners with the authority to adopt rules consistent with this Act to carry out its duties in administering this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 17, 1996. TRD-9606909 Ernest Pereyra, CPA Chief Fiscal Officer Texas State Board of Plumbing Examiners Effective date: June 7, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 458-2145 22 TAC sec.361.6 The Texas State Board of Plumbing Examiners adopts amended sec.361.6, concerning Fees, without changes to the proposed text as published in the February 20, 1996 issue of the Texas Register (21 TexReg 1342). This rule is being amended to increase the Master Examination Fee from $75 to $150 and creates a late penalty fee for inspector licenses. The rule will improve the quality of the examination process used for Master Plumbers. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 6243-101, which provide the Texas State Board of Plumbing Examiners with the authority to adopt rules consistent with this Act to carry out its duties in administering this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 17, 1996. TRD-9606910 Ernest Pereyra, CPA Chief Fiscal Officer Texas State Board of Plumbing Examiners Effective date: June 7, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 458-2145 22 TAC sec.361.7 The Texas State Board of Plumbing Examiners adopts amended sec.361.7, concerning Roster of Licensees, without changes to the proposed text as published in the February 20, 1996 issue of the Texas Register (21 TexReg 1342). This rule is being amended to change the way the public can find out information on medical gas installation companies who choose to comply with the rule. The rule will provide the public with a better way to access information on medical gas installation companies who choose to comply with the rule. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 6243-101, which provide the Texas State Board of Plumbing Examiners with the authority to adopt rules consistent with this Act to carry out its duties in administering this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 17, 1996. TRD-9606911 Ernest Pereyra, CPA Chief Fiscal Officer Texas State Board of Plumbing Examiners Effective date: June 7, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 458-2145 Chapter 363. Examinations 22 TAC sec.363.5 The Texas State Board of Plumbing Examiners adopts amended sec.363.5, concerning Description of Examination, without changes to the proposed text as published in the February 20, 1996 issue of the Texas Register (21 TexReg 1343). This rule is being amended to make it clear that the board will include written and practical applications as deemed appropriate to the examination. The rule change will provide a better quality plumbers since they will have demonstrated both written and practical skills. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 6243-101, which provide the Texas State Board of Plumbing Examiners with the authority to adopt rules consistent with this Act to carry out its duties in administering this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 17, 1996. TRD-9606912 Ernest Pereyra, CPA Chief Fiscal Officer Texas State Board of Plumbing Examiners Effective date: June 7, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 458-2145 22 TAC sec.363.6 The Texas State Board of Plumbing Examiners adopts amended sec.363.6, concerning Special Examination Conditions, without changes to the proposed text as published in the February 20, 1996 issue of the Texas Register (21 TexReg 1343). This rule is being amended to eliminate the redundancy in the rule and removes the foreign language requirement. The rule change will allow plumbers to understand the warning labels and instructions for plumbing equipment installation which are written in English. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 6243-101, which provide the Texas State Board of Plumbing Examiners with the authority to adopt rules consistent with this Act to carry out its duties in administering this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 17, 1996. TRD-9606913 Ernest Pereyra, CPA Chief Fiscal Officer Texas State Board of Plumbing Examiners Effective date: June 7, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 458-2145 22 TAC sec.363.11 The Texas State Board of Plumbing Examiners adopts amended sec.363.11, concerning Endorsement Training Programs, without changes to the proposed text as published in the February 20, 1996 issue of the Texas Register (21 TexReg 1343). This rule is being amended to make it clear that instructors must be active licensed plumbers with the appropriate endorsement in order to teach endorsement training. The rule change will provide for better trained plumbers performing plumbing work who will effectively facilitate the health and safety of the citizenry. It will also better serve the public if plumbers are used to teach plumbers to perform plumbing work, and individuals who currently have the endorsement teach those who seek it. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 6243-101, which provide the Texas State Board of Plumbing Examiners with the authority to adopt rules consistent with this Act to carry out its duties in administering this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 17, 1996. TRD-9606914 Ernest Pereyra, CPA Chief Fiscal Officer Texas State Board of Plumbing Examiners Effective date: June 7, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 458-2145 Chapter 365. Licensing 22 TAC sec.365.1 The Texas State Board of Plumbing Examiners adopts amended sec.365.1, concerning License Categories; Description; Scope of Work Permitted, without changes to the proposed text as published in the February 20, 1996 issue of the Texas Register (21 TexReg 1344). This rule is being amended to remove an unnecessary reference to another section of the rules. The rule change will provide a clear understanding of the rule. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 6243-101, which provide the Texas State Board of Plumbing Examiners with the authority to adopt rules consistent with this Act to carry out its duties in administering this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 17, 1996. TRD-9606915 Ernest Pereyra, CPA Chief Fiscal Officer Texas State Board of Plumbing Examiners Effective date: June 7, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 458-2145 22 TAC sec.365.2 The Texas State Board of Plumbing Examiners adopts amended sec.365.2, concerning Apprentice Registration, without changes to the proposed text as published in the February 20, 1996 issue of the Texas Register (21 TexReg 1344). This rule is being amended to make it clear that an individual must be working at the plumbing trade in order to become a registered plumber apprentice. The rule change will be clearer guidelines for registered plumber apprentices. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 6243-101, which provide the Texas State Board of Plumbing Examiners with the authority to adopt rules consistent with this Act to carry out its duties in administering this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 17, 1996. TRD-9606916 Ernest Pereyra, CPA Chief Fiscal Officer Texas State Board of Plumbing Examiners Effective date: June 7, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 458-2145 22 TAC sec.365.3 The Texas State Board of Plumbing Examiners adopts amended sec.365.3, concerning License Qualifications, without changes to the proposed text as published in the February 20, 1996 issue of the Texas Register (21 TexReg 1344). This rule is being amended to make it clear that repairs are included in the plumbing rules and to specify the licenses and endorsements covered by the license qualification section. The rule change will provide a clearer understanding that repairs are covered by the license qualification section and all of the requirements are required. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 6243-101, which provide the Texas State Board of Plumbing Examiners with the authority to adopt rules consistent with this Act to carry out its duties in administering this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 17, 1996. TRD-9606917 Ernest Pereyra, CPA Chief Fiscal Officer Texas State Board of Plumbing Examiners Effective date: June 7, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 458-2145 22 TAC sec.365.5 The Texas State Board of Plumbing Examiners adopts amended sec.365.5, concerning Renewals, without changes to the proposed text as published in the February 20, 1996 issue of the Texas Register (21 TexReg 1345). This rule is being amended to clarify the procedures a plumber must follow to renew his license. The rule change will provide a clearer understanding of the procedures a licensee must follow to renew his license. No comments were received regarding adoption of the amendment. The rule amendment is adopted under Texas Civil Statutes, Article 6243-101, which provide the Texas State Board of Plumbing Examiners with the authority to adopt rules consistent with this Act to carry out its duties in administering this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 17, 1996. TRD-9606918 Ernest Pereyra, CPA Chief Fiscal Officer Texas State Board of Plumbing Examiners Effective date: June 7, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 458-2145 22 TAC sec.365.6 The Texas State Board of Plumbing Examiners adopts amended sec.365.6, concerning Expirations, without changes to the proposed text as published in the February 20, 1996 issue of the Texas Register (21 TexReg 1345). This rule is being amended to clarify that individuals with licenses which have been expired for more than two years must take the current examination to get a new license, remit the appropriate fee and fulfill the continuing education requirement prior to the renewal of the expired license. The rule change will provide a better understanding of the procedures regarding the renewal of a license, expiration of a license and application for a license previously held. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 6243-101, which provide the Texas State Board of Plumbing Examiners with the authority to adopt rules consistent with this Act to carry out its duties in administering this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 17, 1996. TRD-9606919 Ernest Pereyra, CPA Chief Fiscal Officer Texas State Board of Plumbing Examiners Effective date: June 7, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 458-2145 point=12.05p set=12.05p Chapter 367. Enforcement 22 TAC sec.367.3 The Texas State Board of Plumbing Examiners adopts amended sec.367.3, concerning Requirement for Plumbing Companies, without changes to the proposed text as published in the February 20, 1996 issue of the Texas Register (21 TexReg 1346). This rule is being amended in order to clarify that a company must have a current licensed master plumber that has a current medical gas endorsement in order for the company to install medical gas piping. The rule change will a more qualified Master Plumber will be responsible for supervision of plumbers installing medical gas piping. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 6243-101, which provide the Texas State Board of Plumbing Examiners with the authority to adopt rules consistent with this Act to carry out its duties in administering this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 17, 1996. TRD-9606920 Ernest Pereyra, CPA Chief Fiscal Officer Texas State Board of Plumbing Examiners Effective date: June 7, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 458-2145 22 TAC sec.367.4 The Texas State Board of Plumbing Examiners adopts amended sec.367.4, concerning Display of License, without changes to the proposed text as published in the February 20, 1996 issue of the Texas Register (21 TexReg 1346). This rule is being amended to specify that Responsible Master Licensees must display their permanent license in the place of business and that all licensees shall carry their pocket card license. The rule change will provide an easier way to determine if a plumber is licensed and a Master Plumber is responsible for the work at issue. No comments were received regarding adoption of the amendment. The amendment is adopted under Texas Civil Statutes, Article 6243-101, which provide the Texas State Board of Plumbing Examiners with the authority to adopt rules consistent with this Act to carry out its duties in administering this Act. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 17, 1996. TRD-9606921 Ernest Pereyra, CPA Chief Fiscal Officer Texas State Board of Plumbing Examiners Effective date: June 7, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 458-2145 TITLE 30. ENVIRONMENTAL QUALITY Part I. Texas Natural Resource Conservation Commission Chapter 1. Purpose of Rules, General Provisions 30 TAC sec.sec.1.1-1.11 The commission adopts new sec.sec.1.1-1.11, concerning procedural rules. Sections 1.1, 1.5, 1.7, 1.10, and 1.11 are adopted with changes to the proposed text as published in the February 20, 1996, issue of the Texas Register (21 TexReg 1349). Sections 1.2-1.4, 1.6, 1.8, and 1.9 are adopted without changes and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. Comments were received from Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts. Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts generally supported the adoption of the proposed sections with some changes. Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund, while apparently not opposing the adoption of the proposed sections as a whole, generally expressed concerns related to public participation and issues related to delegated federal programs. A number of commenters suggested minor editorial, typographical, and grammatical changes to clarify or shorten the proposed sections. The commission generally agrees with these suggestions, and has amended the proposed sections accordingly. These changes have been made to proposed sec.sec.1.1, 1.5, 1.7, 1.10, 1.11(a), 3.2, 5.3, 5.8, 5.10, 5.11, 5.12, 5.14, 10. 1, 10.2, 10.3, 10.6, 10.8, 20.17, 40.5, 40.6, 40.8, 40.9, 50.13, 50.17, 50.31, 55.21, 55.23, 55.25, 55.27, 55.29, 55.31, 70.2, 70.3, 70.4, 70.5, 70.6, 70.7, 70.8, 70.9(b), 70.10, 70.11, 70.101, 70.102, 70.104, 70.107, 70.108, 70.109, 80.3, 80.11, 80.17, 80.21, 80.23, 80.29, 80.31, 80.33, 80.109, 80.111, 80. 113(c), 80.115, 80.119, 80.127, 80.133, 80.155, 80.201, 80.205, 80.207, 80.209, 80.213, 80.251, 80.253, 80.257, 80.265, 80.267, 80.271, 86.1, 86.11, 86.15, 86.16, 86.34, 86.55, 86.96, 86.98, 86.99, 86.130, 86.131, 86.132, 340.41(b), 340.43(d), 340.45, 340.53(d), 340.71, 340.73, and 340.131. The titles of proposed sec.sec.10.9, 20.19, 40.5, 40.6, 40.8, 50.39(e), 55.31, 70.109, 80.5, 80.23(b), Chapter 50, Subchapter B and Chapter 86, Subchapter D have also been amended for clarity and to reflect their true content. Several commenters commented generally that the proposed sections limit public participation in permit and enforcement actions more stringently than allowed under federal law and do not meet the minimum requirements for federal program approval, basing this comment in part on a draft report prepared by one of the commenters. The commission disagrees. The commenters very narrowly construe the concept of public participation, and the commission does not agree that the statistics contained in the draft report are accurate. The commission does not agree that such a narrow emphasis on contested case evidentiary hearings at the expense of other methods of public participation is either fair or appropriate. The commission also does not agree that the proposed sections impose new limits on public participation. Although the commission's process will be continually reviewed and improved, the process and the proposed sections are consistent with the "United States Environmental Protection Agency's (EPA) Policy Statement of Public Participation," which contains no requirement for contested case hearings on every permitting matter. Public notice is given in compliance with statutory requirements, and when questions or comments from the public are received, the agency's technical staff responds to them. Agency permit engineers and attorneys spend a considerable amount of time answering questions from the public, meeting with them, educating citizens on both the scientific and legal requirements of permits. As questions are raised, staff reconfirms the review and position it is taking on permits. When there is considerable public interest expressed, the agency often will hold one or more public meetings in the local area to encourage give and take between the public, the applicant, and the staff. This is in addition to public meetings that may be required by statute (e.g., Texas Health and Safety Code, sec.361.0791, on hazardous waste management permits). Most importantly, the commenters overlook the provisions of the proposed sections which in fact dramatically increase the opportunity for public participation--now, every motion for reconsideration of an executive director's action goes directly to the commission, and every hearing request is placed on a commission meeting agenda with the right of the requestor to share information and concerns directly with the three commissioners. Most determinations on hearing requests, prior to September 1, 1995, were handled by the Office of Hearing Examiners with little, if any, involvement by the commissioners. The public now has the ability to submit information and concerns to the commissioners, very often has the ability to personally address the commissioners, and the commissioners have the ability to require the applicant and the executive director's staff to respond to those concerns. The exchange takes place in a posted, public hearing. This satisfies the "exchange of views and open exploration of issues, alternatives, and consequences" standard contained in the EPA Policy Statement. Although the commission believes that the proposed sections represent a dramatic improvement, the commission continues to explore ways to enhance this exchange of views. Several commenters suggested that the commission failed to provide notice of the procedural rule changes to the EPA as required. The commission disagrees. The commenters erroneously interpret 42 United States Code, sec.300h- 1(b)(1)(A)(ii) to require notice prior to final adoption of this rule package. Correctly read, the statute only requires notice of a rule change to the EPA after final adoption of an underground injection well program or changes to the program. Upon adoption of this package, the commission will provide appropriate notice to the EPA. One commenter suggested that proposed sec.1.1 be expanded to address both the purpose and scope of the commission's rules. The commission disagrees with this proposal because the language proposed would state what is already law, that the rights of parties and the commission's powers are established by statute and cannot be enlarged by rule, and that the statutes prevail if the commission's rules are in conflict with them. Several commenters criticized the commission's handling of confidential documents under current rules being revised and adopted as proposed sec.1.5. The commission disagrees with these comments because the commission's management of confidential documents complies with all applicable requirements. Another commenter proposed additional language for this section which would specify the duties of the agency's central records office. The commission disagrees, because the proposed directives concerning internal office procedure can be made without adopting the directives as a rule. The commission notes that it has recently directed its executive director to evaluate the agency's record management practices. This evaluation is already under way, and will include the agency's handling of confidential documents to ensure they are not inadvertently disclosed to the public. A request for proposal has been published for a study on the matter. One commenter suggested that proposed sec.1.11 be amended to make it clear what is included in the phrase "courier-receipted delivery service." The commission believes that the phrase is sufficiently clear, and declines to add any definition beyond that already provided in Texas Rule of Civil Procedure 21a. The commission believes that the modifications to proposed sec.1.11 described as follows may also resolve the commenter's concerns. One commenter noted that proposed sec.1.11 and sec.10.10 appear to be missing subsection (e), which appears in old sec.261.18, from which they are derived. The commission agrees. This deletion was inadvertent, since proposed sec.1.11 and sec.10.10 were intended to include the provisions of old sec.261.18. Proposed sec.10.10 duplicates proposed sec.1.11 and has been deleted, and subsection (e) has been added to proposed sec.1.11. In addition, the commission has further clarified proposed sec.1.11 by more closely tracking Texas Rule of Civil Procedure 21a, which the commission believes covers the same subject matter more completely, and has amended and renumbered subsections accordingly. One commenter suggested that proposed sec.3.2 be revised to incorporate several definitions currently contained in other chapters. The commission agrees in part, and has added definitions of "enforcement action" and "enforcement order" to proposed sec.3.2. Other definitions not moved are used only in single chapters, and the commission believes it more useful to leave those definitions in the chapter to which they apply, rather than move them to a general definitions section. The commission intends, however, to continue to consolidate widely used definitions in Chapter 3 for clarity and consistency. One commenter suggested that the definition of "advisory committee" in proposed sec.5.2 be condensed. The commission agrees, and has amended the proposed section accordingly. This commenter also suggested that this definition be moved from proposed sec.5.2 to proposed sec.3.2. Since this term seems to be used only in proposed Chapter 5, the commission disagrees and has left the definition in proposed sec.5.2. One commenter suggested that proposed sec.10.7 be amended to clarify that the commission will keep a certified agenda of closed meetings held in accordance with the requirements of the Texas Open Meetings Act. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.10.9 and sec.10.10 duplicate proposed sec.1.10 and sec.1.11, and suggested that the proposed sections appear only in proposed Chapter 1. The commission agrees, and has deleted proposed sec.10.10 and amended proposed sec.10.9 to change its title and refer to proposed sec.1.10 and sec.1.11. One commenter suggested that proposed Chapter 40 be amended to allow participation in Alternative Dispute Resolution (ADR) by "interested parties" and to allow mediation to occur before a request for hearing is made. While the commission wholeheartedly supports ADR efforts, it disagrees for two reasons, and declines to make the change. First, participation in ADR in contested cases must necessarily be limited to the parties to the case, or at the hearing request stage, to those filing hearing requests as well. Without this limitation, the commission believes it will be difficult for participants to commit to a process where the number and identity of negotiating parties is subject to change. Second, while the commission is strongly committed to ADR, and encourages its use at all stages of the application process, it believes that it is wiser to continue to encourage informal ADR outside of agency rules prior to entry into the contested case process, and leave its use up to the participants, rather than attempt to promulgate rules governing its use at this time. One commenter suggested that the definition of the term "alternative dispute resolution office" in proposed sec.40.2 be replaced with a definition of the term "alternative dispute resolution director" because the latter is used throughout proposed Chapter 40. The commission agrees, has amended the proposed section accordingly, and has also amended proposed sec.40.5(a)(1) accordingly. One commenter suggested deleting the words "regardless of which ADR method is used" from the definition of "mediator" in proposed sec.40.2, as not adding to the definition. The commission disagrees, because it believes that the term "mediator" is used in some circles as a term of art to refer only to a person engaged in specific dispute resolution procedures, and the term is used in these proposed sections in a more inclusive manner. One commenter suggested using the word "applicant" rather than a longer term in the definition of "participant" in proposed sec.40.2, and adding "named parties" to the definition to make clear that they are included in the definition. The commission agrees, and has amended the proposed section accordingly. One commenter suggested deleting the words "from the pool of mediators" from the first sentence of proposed sec.40.4(a) and adding clarifying language regarding private mediators, to make the proposed section more consistent with the other proposed sections of the chapter. The commission agrees, and has amended the proposed section accordingly. One commenter suggested rewording proposed sec.40.4(c) for brevity and clarity. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.40.6 could be read to exclude the possibility of a matter being referred to ADR after a draft permit is proposed and a protest letter received, but prior to the matter being referred to the State Office of Administrative Hearings (SOAH), as proposed sec.55.25(d)(1) anticipates, and suggested amending the proposed section. The commission agrees with the commenter that this can be the most productive period for ADR, expressly desires to encourage ADR at this point, and has amended the proposed section to make it clear that cases may be referred to ADR at this point and that ADR outside of the commission process may be used at any time. Several commenters commented that proposed sec.50.13 and sec.50.33 allow the commission and its executive director to act on an application without considering any comments, and generally maintain that the proposed sections of procedural rules as a whole preclude public comment. The commenters also claim that the provisions of proposed sec.50.33 which prevent action by the executive director where there is a "protest" and the provision for motions for reconsideration are not an adequate substitute for a public comment process. The commission disagrees, and declines to amend the proposed sections. Proposed sec.50.13 and sec.50.33 allow action without a contested case hearing, which is not equivalent to action without considering comments. The procedures contained in the proposed procedural rules sections are, for the most part, in addition to the commission's public comment process, rather than a substitute for them, as the commenters apparently assume, and the equation of participation in a contested case hearing with public comment is inappropriate. The commission actively encourages public participation, and has gone on record repeatedly to express this and to broaden public participation, but believes that the amendments suggested by the commenters go far beyond the scope of this rulemaking. One commenter suggested that proposed sec.50.39 be amended to allow only an "affected person" to file a motion for reconsideration of an executive director's action on an application, suggesting that the term "other person" is too broad. The commission disagrees, and declines to change the proposed section, because the proposed language gives the commission flexibility to reconsider decisions in situations where the error complained of merits attention regardless of who raises it. Additionally, allowing any person to file a motion for reconsideration allows another avenue for public comment by bringing concerns directly to the attention of the commission. The commission believes, however, that the question of whether a person filing a motion for reconsideration is an affected person will in some cases have a bearing on whether the commission acts on the motion. Several commenters criticized proposed sec.55.21(b) and (d), claiming that because of multiple publications, it may be difficult to tell when the deadline for a hearing request occurs. While much of the timing and many of the contents of notices are specifically required by statute, to the extent that this becomes a problem, the commission plans to deal with it in rulemaking on a new proposed chapter governing public notice, rather than in this rulemaking. Several commenters suggested that proposed sec.55.21(c) constitutes an unlawful delegation and allows the person who designs a notice to decide what will be required in a hearing request. The commenters further assert that the proposed section does not adequately plan for errors in the published notice. The commission disagrees, and declines to change the proposed section. The statutes and other sections of the commission's rules dictate the content of public notices, and this proposed section merely requires hearing requests to comply with those requirements, if any. If the notice is defective, this must be generally cured through republication, thus giving another chance to comply with any requirements. Several commenters criticized proposed sec.55.21(e) for not establishing procedures for requesting extensions of time and suggested the inclusion of a "good cause" or public interest test. The commission disagrees. This section is primarily intended to allow the commission to consider late hearing requests. The commission believes that the proposed section allows more flexibility for the commission and the public than the suggestion does, and declines to change the section. One commenter suggested that proposed sec.55.23(b) be revised to require a group or association to provide an explanation of its hearing request with sworn affidavits, written resolutions, or other satisfactory documentation, rather than to allow other parties to request such an explanation. The commission disagrees. While the proposed sections anticipate that a group or association will submit such information, requiring this as an absolute requirement in advance when the group or association's qualifications are not in dispute is burdensome and unnecessary. However, allowing the listed parties to request that evidence, if they believe it to be an issue, protects the integrity of the hearing process and the rights of the applicant while limiting evidence and testimony to those issues that are actually in dispute. Several commenters suggested that proposed sec.55.23(b) and sec.55.26(f) place unreasonable burdens on the public in replying to responses to hearing requests. There is no proposed sec.55.26 and the latter reference is apparently to proposed sec.55.25(f). The commission disagrees, because these proposed sections merely provide a way for the commission and other parties to determine the basis of a hearing request, which is clearly relevant under Texas Water Code, sec.5.115. While the commission does not agree that the proposed time periods are unreasonable, it has determined that the time for replying to responses to hearing requests in proposed sec.55.25(f) should be lengthened from ten days to 14 days to give requestors more time to prepare, and has amended proposed sec.55.25 accordingly. Several commenters suggested that the commission amend proposed sec.sec.55.25, 55.27, 55.29, and 55.31, to change the way the commission deals with hearing requests and with determinations of whether a person is an "affected person," whether a request is "reasonable," and what constitutes "competent evidence" under Texas Water Code, sec.5.115. The commission agrees that these items may need further attention, but, as announced at the beginning of this phase of rulemaking and stated in the preamble to these proposed rules, has reserved this issue for further rulemaking, once sufficient experience has been accumulated with the existing process to fairly evaluate how well the existing rules are working. This project is already underway at the agency, and the commission expects that it will get into full swing shortly after this rulemaking project is concluded. While some minor adjustments to the current process are included in this round of rulemaking, the commission declines to make the suggested major changes in this round of rulemaking. Several commenters suggested that the proposed sections place an unreasonable burden on who can qualify for a hearing and claimed that the commission has not implemented its authority to provide for public participation in hearings. The commission disagrees. As noted previously, the commission believes that the proposed sections broadly encourage public participation. In addition, the proposed sections are entirely consistent with the law on hearings and standing. Finally, the commission is already committed to reviewing this process in another round of rulemaking. Several commenters suggested that proposed sec.55.25(g) be revised to allow a legislator (for an activity in the legislator's district), a state agency, a federal agency, or a local government (for a facility within the local government's jurisdiction) to send an application directly to SOAH for a contested case hearing. The commission disagrees. Nothing in the statutes grants such blanket rights, and the commission believes that adding this provision would violate both the letter and intent of Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115, as well as other specific statutes dealing with contested case hearings, and therefore declines to make this change. One commenter noted that the provisions of proposed sec.55.27 and sec.55.29 do not appear to address instances where the definition of affected persons in the rule (and in Texas Water Code, sec.5.115) may differ from specific statutory provisions defining "affected person" or "person affected," and suggested that the proposed sections be revised to make it clear that specific statutory provisions control. In the alternative, the commenter suggested that the commission apply both the definition of "affected person" in the proposed sections and any specific statutory definition. The commission agrees with the commenter that Texas Water Code, sec.5.115, the proposed sections, and other specific statutes can and should be read together. Generally, Texas Water Code, sec.5.115 will require a "personal justiciable interest," while other specific statutory provisions delineate those interests, specifying distance limitations or identifying specific persons who can request a hearing. The commission believes that the provisions of proposed sec.55.27 (that a hearing request be granted if it is "pursuant to a right to hearing authorized by law") and proposed sec.55.29 (that a relevant factor in determining whether a person has "a personal justiciable interest related to a legal right, duty, privilege, power, or economic interest affected by the application" is "whether the interest claimed is one protected by the law under which the application will be considered") require Texas Water Code, sec.5.115 and any applicable specific statute to be read together. Thus, the commission declines to modify the proposed sections. Several commenters suggested that proposed sec.55.27(b) and (c) be amended on the grounds that they conflict with statutory provisions such as Texas Water Code, Chapter 27, in which counties are granted hearings regardless of a showing of standing or reasonableness of their hearing requests. The commenters also suggested that the test for a state agency or local government needs to be clarified, alleging, for example, that a county is automatically an affected person for an activity in that county. The commission disagrees. No statute, other than those giving party status to the executive director, public interest counsel, Texas Water Development Board, and Texas Parks and Wildlife Department, provides as a blanket rule that a governmental entity is automatically an affected person for all activities in a geographic area, although some do in specific instances. Texas Water Code, sec.27.018, for instance, provides for a hearing on an injection well permit application if one is requested by a "local government." The statute further distinguishes between the terms "local government" and "affected person"--a distinction that does not appear in Texas Water Code, sec.5.115. While there may be some confusion over the use of the term "affected person" in more than one context, the commission believes that it is clear that a hearing request by a local government under Texas Water Code, sec.27.018 meets the tests of reasonableness and being "pursuant to a right to hearing authorized by law" under proposed sec.55.27(b) and "in the public interest" under proposed sec.55.27(c), and that a governmental entity may be an affected person given the definition of "person" contained in proposed sec.3.2 and its "authority under state law" in proposed sec.55.29(b). The commission further believes that the tests for a state agency or local government are sufficiently clear, and therefore declines to amend the proposed sections. Two commenters suggested that the provisions of proposed sec.55.27(c), which allow the commission to refer an application to SOAH for hearing if the commission determines that a hearing would be "in the public interest" even if there is no valid hearing request, be deleted or that the commission delineate standards it will use in making this determination. Several commenters suggested that the provision is vague in that it does not define "public interest." The commission disagrees with these comments and declines to make the suggested changes, in that it believes that there may be situations where the public interest demands a hearing (one example might be information received after the deadline for hearing requests), and also believes that it would be impossible to define "public interest" at this time in terms more specific than those used by the statutes under which the commission operates. One commenter suggested that proposed sec.55.27(c) be deleted as duplicative of proposed sec.55.27(b)(1). The commission disagrees and declines to make the proposed change. Proposed sec.55.27(b)(1) allows a commissioner, an applicant, or the executive director to request a contested case hearing and thereby refer a case to SOAH, while proposed sec.55.27(c) allows the commission as a whole to vote to send a case to SOAH. The two provisions serve different purposes and the commission believes they should be kept separate. Several commenters suggested that the commission's rules on notice need significant changes, and suggested that proposed sec.55.27(c) be amended to prohibit the final notice on a permit from being issued before technical review is complete and a draft decision is available. The commission does not agree that these proposed sections are the place to deal with notice requirements, notes that no notice has been given to the public or interested parties that notice requirements would be changed in these proposed sections, and points out that it is in the process of preparing for publication a new chapter to consolidate many of its notice rules. However, the commission disagrees with the commenters that the existing rules regarding notice are inadequate or restrict public participation. Proposed sec.55.27(c) does not deal with notice, but rather allows the commission to refer an application to SOAH even if there is no hearing request, and the commission does not agree that amending it to deal with notice would be appropriate or advisable. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear whether an administrative law judge can overrule a commission denial of a hearing request based on standing. The commission has amended proposed sec.55.27(f) to make its position on this issue more clear--that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear what must be done to appeal the denial of a hearing request, do not make it clear when the time period for appeal begins to run, and add new burdens by requiring two appeals. The commission does not agree, and declines to further amend the proposed sections beyond the amendments already described. The proposed sections make it clear that a party whose hearing request is denied must seek to obtain party status and then, if unsuccessful, follow procedures for a motion for rehearing as a prerequisite to appeal once the commission has disposed of the application. Since a person who files a hearing request is asking that a contested case hearing be held, that party obtains the relief sought if any hearing request is granted. That person must then seek to be admitted as a party if the person wishes to participate in the case, and decisions on that issue will be handled as they are now, although the commission anticipates that if the person has a complaint at this point, it will be the denial of party status or a limitation of issues rather than a determination on a hearing request. If all hearing requests are denied or withdrawn, persons whose requests are denied have an opportunity for the review of that decision by filing a motion for rehearing after the commission's decision on the application--that is, at the end of the case, rather than in an interlocutory appeal, as the commenters seem to suggest. The commission believes that it is clear in the proposed sections that the time period for appeals begins to run at this point. While the commenters also suggest that it is unreasonable to force parties to go through a hearing and have the result of that hearing reversed by a court based on an error in denying party status, the commission believes that the risk of this kind of result is minimal, is inherent in every determination of party status in any kind of proceeding, and is outweighed by the burden to the public that would be imposed by delaying every permitting decision until determinations of party status are appealed through the court system. Two commenters noted that proposed sec.55.27(f) allows a person whose hearing request is denied to still seek to be admitted as a party, and suggested that absent some compelling reasons, the commission's determination on the hearing request should preclude the later admission of the person as a party. The commission disagrees, and has amended the proposed section as noted previously to make it clear that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. One commenter suggested that proposed sec.55.27 be amended to allow a motion for reconsideration, rather than a motion for rehearing, of the denial of a hearing request, suggesting that the latter is only appropriate in contested cases under the Administrative Procedure Act, and that no contested case arises if a hearing request is not granted. The commission disagrees. As stated previously, the commission believes that a decision on the validity of a hearing request is an interlocutory decision only on the validity of the request, and does not necessarily dictate the outcome of a later decision on party status, or standing. The commission believes that a motion for rehearing at the conclusion of the proceedings is the most appropriate way to review such a decision. Several commenters remarked that the proposed sections do not allow for an adequate record for judicial review when no contested case hearing is held and do not establish standards for a court to use in its review. The commenters also suggest that the proposed sections do not create an adequate record in rulemaking. The commission disagrees, and declines to make changes based on this comment, because it believes that the record created is sufficient for judicial review of the commission's actions, and the standards of review are already clearly established in the statutes and rules. Similarly, the commission believes that the record created in rulemaking proceedings is more than adequate. Several commenters suggested that proposed sec.55.29 and sec.55.31 be revised to provide that the commission accept as true written statements of a person filing a hearing request for the purposes of the determination on the request or the person requesting a hearing be given an opportunity to present evidence to meet the burden of presenting competent evidence under Texas Water Code, sec.5.115. The commission disagrees and declines to make these changes. The first alternative ignores the clear intent of Texas Water Code, sec.5.115, by allowing a person to meet its standards by simply claiming that the standards are met. Texas Water Code, sec.5.115 provides that the commission "is not required to hold a hearing if the commission determines that the basis of the person's hearing request is unreasonable or is not supported by competent evidence." The second alternative does not recognize that this determination will require different procedures in different cases, and the flexibility which the proposed sections provide--from a decision on the pleadings to oral argument to an evidentiary hearing--allows for procedures to be followed which are appropriate for the cases presented. For example, a permit renewal under Texas Health and Safety Code, sec.382.056 may be an example of a case where requests not alleging increases in emissions or compliance problems can be dealt with on the pleadings alone. Similarly, a person who cannot allege a reasonable basis for a hearing request or who cannot allege that competent evidence exists to support the request, despite having more than one opportunity to do so (the request itself, a reply filed under proposed sec.55. 25(f) to responses that point out the merits or deficiencies of the request, and, in appropriate cases, argument or testimony before the commission) is not going to be able to present such evidence at a hearing, and it may be appropriate to resolve this request without an evidentiary hearing. Several commenters suggested that proposed sec.55.31 is unconstitutionally vague and conflicts with other Texas Natural Resource Conservation Commission rules and the law, specifically proposed sec.55.29 and Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115 and that the provisions of proposed sec.55.31(b)(3) are overly burdensome on public participation. The commission disagrees. The commission believes that the proposed section fully complies with the constitution and with Texas Health and Safety Code, sec.382. 056 and Texas Water Code, sec.5.115. The term "reasonableness" is adequately defined by proposed sec.55.31. Further, proposed sec.55.31 does not conflict with proposed sec.55.29, because they deal with different matters--the first with the determination of whether a person is an "affected person," and the second with whether a hearing request is "reasonable." Several commenters suggested that the proposed rules be revised to "provide that the commission will make determinations and record those determinations so that the public can understand the basis for its government's decision and so that a reviewing court can determine if the actions of the commission should be affirmed or reversed." As noted previously, the commission believes that the proposed sections do exactly that and declines to make changes based on this comment. Several commenters suggested that proposed sec.55.33(a)(3) (and presumably proposed sec.80.5(a)(3)) be revised, claiming that the proposed section requires the Chief Clerk to pay the cost for issuing public notices. The commission disagrees, since the proposed section requires the clerk to issue notice and does not provide for the Clerk to pay the cost of notice, since applicants are clearly responsible for those costs. Proposed sec.55.33 has been withdrawn, however, and only proposed sec.80.5 now governs the Chief Clerk's actions in this context. Several commenters noted that the setting procedures of proposed sec.55.33 largely duplicate those of proposed sec.80.5, and suggested the deletion of one or the other. Some commenters suggested conforming these two proposed sections. The commission agrees that these sections are duplicative and should be conformed, and notes as well that proposed sec.70.109 largely duplicates both of these sections. For clarity, the commission believes that it is most logical to lay out all setting procedures only in proposed Chapter 80, and has deleted proposed sec.55.33 and amended proposed sec.70.109 accordingly. Several commenters suggested that the proposed sections of proposed Chapter 70 limit public participation in enforcement proceedings in a fashion that does not meet the federal requirements for such participation and further state that notice in the Texas Register is insufficient. The commission disagrees, and declines to change the proposed sections. The agency complies with federal authorization rules regarding public participation in enforcement matters, which require the agency to have procedures in place for responding to citizen complaints, publish notice of settlements of civil actions, and give assurance that it will not oppose intervention by any citizen when permissive intervention is authorized by statute, rule, or regulation. In regard to the comment that Texas Register publication is insufficient, while the commission disagrees, it is currently considering alternative citizen participation in administrative actions. If rule changes are necessary after a decision is made on this issue, they will be taken up separate from this rulemaking. One commenter suggested that the definitions of "enforcement order," "enforcement action," "petition," and "respondent" be moved from proposed sec.70.2 to proposed sec.3.2. The commission agrees that the definitions of "enforcement action" and "enforcement order" should be moved to sec.3.2 since they are used in general context in other chapters of the agency's rules; however, the terms "petition" and "respondent," as they are defined in proposed Chapter 70, are specific to enforcement actions by the commission only and should remain in proposed Chapter 70. The commission does not believe that generic definitions of petition and respondent are necessary in proposed Chapter 3 to cover permitting matters because those terms are generally accepted legal terminology and "petition" is already included in the definition of "application." One commenter suggested that proposed sec.70.51 substantially changes old sec.337.71 from relating only to water rights enforcement matters to a more general mandatory enforcement hearing process. The commission disagrees. The language in proposed sec.70.51 was taken verbatim from old sec.337.71, except that the title of the subchapter was changed and references to other rules which had been renumbered were changed. The definitions included in old sec.337. 71 included water quality, water rights, hazardous waste releases, and references to the air statute as well. Although the title of old sec.337.71 indicated "Water Rights Enforcement," its statutory basis is Texas Water Code, sec.5.117, which applies to the agency as a whole, and requires the executive director to bring all instances of substantial noncompliance before the commission. The commenter expressed concern that proposed sec.70.51 would require mandatory hearings for incorrect compliance with record keeping requirements in an air permit. Since this would normally not be a substantial noncompliance under the air rules, this section would not apply in that case. Furthermore, old sec.337.71 and proposed sec.70.51 both exclude air violations, since a separate statutory requirement exists for the air program. The program most affected by this statutory requirement is the water quality program, which has a large amount of self-reporting data submitted each month. The proposed section basically sets forth the practice of the watershed management and enforcement divisions in processing this large volume of documents and describes how they determine what constitutes a substantial noncompliance. One commenter suggested that the concept of "executive director preliminary reports" (EDPR), used in proposed sec.70.101, is not necessary in proposed Chapter 70 and is not mandated by statute. While EDPRs are not required by statute, they are clearly allowed and anticipated by statute (see Texas Water Code, sec.sec.13.4151(c) and (d), 26.136(d) and (e), 27.1015(d) and (e), 34. 011(d) and (e) and Texas Health and Safety Code, sec.sec.341.049(c) and (d), 361. 252(d) and (e), 366.0924(d) and (e), 382.088(d) and (f), and 401.384- 401.385). This rulemaking does not alter the provisions in old Chapter 337 regarding preliminary reports, and sets forth the agency's procedures if preliminary reports are chosen as the form of pleading in a case. The executive director is not required to issue a preliminary report, but is given an option which may be used on a case-by-case basis, which is consistent with the statutory provisions. The commission disagrees with the comment and declines to change the proposed section. The commission has determined that the setting procedures of proposed sec.70. 109 largely duplicate those of proposed sec.80.5, and has amended them to simply refer to proposed sec.80.5. The commission has also amended the title of this section for clarity. One commenter suggested that proposed sec.80.3(a) be amended to make it clear that the judge sitting in a phase of a hearing, not the presiding judge, will resolve evidentiary questions raised during that phase of a hearing. The commission generally agrees, but believes that it may be necessary for a judge sitting in one phase of a hearing to refer some important evidentiary questions to the presiding judge, and has amended the section accordingly. Two commenters suggested that proposed sec.80.3(b)(10) be revised to make it clear that the judge may limit the time of presentation of evidence and witnesses without unfairly prejudicing the rights of parties. The commission agrees, and has amended the rule accordingly. In addition, the commission believes that splitting proposed sec.80.3(a) into two subsections and redesignating proposed sec.80.3(b) as sec.80.3(c) makes the proposed rule more readable, and has amended it accordingly. Two commenters suggested that proposed sec.80.5(b) be amended to expressly state that the commission may limit the issues that shall be considered by SOAH in a contested case. The commission agrees that this ability is implicit in Texas Government Code, sec.2003.047(e), and has amended the proposed section accordingly. These commenters also suggest that the proposed section be amended to provide that the commission "may," rather than "shall," identify issues to be addressed. Since Texas Government Code, sec.2003.047(e) uses "shall," the commission disagrees and declines to make this change. The commission has amended proposed sec.80.5(b) to make it clear that the executive director's petition or EDPR serves as the list of issues to be addressed by SOAH in a contested enforcement case. One commenter suggested that proposed sec.55.33(b) (the same as proposed sec.80.5(b)) be deleted, stating that while the commission may want to restrict or direct the list of issues, the proposed section suggests that a referral is not adequate if it does not. The commission disagrees, since Texas Government Code, sec.2003.047(e) clearly mandates an issues list, and since the proposed section gives the commission the flexibility to submit both broad and narrow ranges of issues. Several commenters suggested that proposed sec.80.13 be amended to allow parties, as well as the executive director, to request consolidation of related proceedings. The commission disagrees and declines to change the proposed section, because this is already allowed by the proposed sections. Proposed sec.80.13 allows the executive director to consolidate matters with the permission of the judge, and allows the judge to consolidate matters, presumably on the judge's own motion or that of any party. One commenter noted that due to changes in Chapter 291 of the commission's rules, proposed sec.80.17 does not accurately reflect the burden of proof in certain water and sewer rate cases. The commenter also noted that enforcement cases covered by subsection (c) of the rule should be expressly excepted from subsection (a). The commission agrees, and has amended the proposed section accordingly. One commenter suggested that proposed sec.80.27 be deleted as duplicative of proposed sec.sec.1.08, 1.10, 1.11, and 80.31. While the proposed sections cover similar matters, the commission disagrees and declines to make the change, because proposed sec.80.27 covers mostly matters of form, while the other proposed sections deal with more procedural matters. The commission has amended proposed sec.80.101 to make it clear that the executive director may either act on a matter remanded to the executive director or set it for consideration at a commission meeting. This is allowed by the proposed section, but the amendment lends clarity. One commenter suggested that proposed sec.80.107 is of sufficient importance that it should be dealt with as a separate subchapter. While the commission agrees that the proposed section is important, it prefers as a matter of form at this time not to create additional subchapters, and declines to make the change. One commenter suggested deleting the phrase "administrative law" from a reference in proposed sec.80.107(a)(3) to result in consistent references to the presiding officer as "judge." The commission agrees, and has amended the proposed section accordingly. One commenter suggested amending proposed sec.80.109(b) to define only statutory parties. The commission disagrees, and believes that the proposed section serves a more useful function by referring to all parties to an application, rather than just statutory parties, and declines to make this change. One commenter suggested deleting proposed sec.80.109(c) as duplicative of proposed sec.80.115. The commission agrees, and has amended the proposed section accordingly, renumbering the subsequent subsections. One commenter suggested deleting proposed sec.80.109(d) (now sec.80.109(c)) as duplicative of proposed sec.80.3(b)(5). The commission disagrees, since the section as amended in response to comments on proposed sec.80.115 now makes it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. One commenter suggested moving proposed sec.80.109(e) ((now sec.80.109(d)) to proposed sec.80.119, arguing that it makes more sense to discuss the effects of continuance in that section. The commission disagrees and declines to make the change. Proposed sec.80.109(e) (now sec.80.109(d)) is intended to make it clear that a person designated as a party retains party status regardless of any postponement of a hearing. Since the rule is limited to party status, the commission feels that it makes more sense to leave it in its present location. Several commenters commented that proposed sec.80.111 prohibits the judge and commission from considering comments. The commission disagrees, and points out that the section does not at all impair the executive director's ability to consider comments. The proposed section prohibits the judge from considering protests or comments submitted by non-parties in a non-evidentiary context (not under oath and without the opportunity to cross-examine) as evidence in contested case proceedings. The commission believes this is required by law, and declines to change the proposed section. The commission notes, however, that the phrase "[i]n proceedings other than enforcement proceedings" was inadvertently published as the end of the second sentence of this section, rather than as the beginning of the third sentence. The commission has amended the section accordingly, so that this limitation applies to questions submitted to the judge, not to the consideration of comments. One commenter noted that proposed sec.80.115 is not clear as to whether each and every party has a right to conduct discovery, present a direct case, cross- examine witnesses, obtain copies of pleadings, and so on, even when parties have been aligned under proposed sec.80.109. The commission agrees that the two provisions could be confusing when read together, and has amended proposed sec.80.109(d) to make it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. The commission anticipates that judges will exercise their best judgment when aligning parties and specifying the purposes for which they are aligned. One commenter suggested that proposed sec.80.117(b) be revised to make it clear that all persons granted party status are covered in the order of presentation. The commission agrees, and has amended proposed sec.80.117 by substituting the words "other parties" for the word "protestant." One commenter suggested deleting the word "SOAH" from proposed sec.80.119(d) to make it clear that the section does not restrict the judge in a contested case proceeding to the use solely of SOAH mediators. The commission agrees, and has amended the proposed subsection accordingly. The subsection has also been combined with proposed sec.80.119(c), to make the section shorter and more clear. One commenter suggested combining proposed sec.80.127(a)(2) and (c) to eliminate duplication. The commission agrees, and has amended the proposed section and renumbered subsections accordingly. One commenter suggested that proposed sec.80.127 be revised to more closely track the provisions of Texas Rule of Civil Procedure 267 and Texas Rule of Evidence 613, which prohibit the exclusion from the hearing room when "the rule" is invoked of an officer or employee of a party that is not a natural person and who is designated as its representative by its attorney and a person whose presence is shown by a party to be essential to the presentation of its case. The commission agrees, and has added subsection (f) to the proposed section so that it will more closely track the practice in the courts. One commenter suggested amending proposed sec.80.133 to allow the judge to set a schedule for the submission of written briefs. The commission agrees, and has amended the proposed section accordingly. Two commenters suggested that proposed sec.80.137 be amended to incorporate by reference Texas Rule of Civil Procedure 166a, because of the substantial body of interpretive case law and legal commentary available. The commission agrees that Rule 166a contains valuable guidance, and has tried to track the language of the rule in the proposed section as far as it considers appropriate given the difference between the administrative and judicial processes and the commission's assumption that the most likely use of the proposed section will be to limit issues, rather than to dispose of applications. The commission has accordingly modified the proposed section to track Rule 166a more closely, and anticipates that practitioners and judges will look to Rule 166a and the decisions construing it for guidance. Two commenters suggested that proposed sec.80.137 be amended to change some language relating to testimonial evidence. Because of the amendments noted previously, the commission believes the issue raised by this language to be resolved and declines to make further changes. One commenter suggested that proposed sec.80.151 be amended to expressly refer to Texas Rule of Civil Procedure 215. The commission disagrees, and declines to change the proposed section, because it believes that the grant of authority in Texas Government Code, sec.2003.047 and the sanctions provisions of proposed sec.80.107 already make sufficient provision for sanctions for discovery abuse. One commenter suggested that proposed Subchapter E of Chapter 80 (the "Freeze Rules") be deleted. While the commission recognizes the commenter's concern, it feels that the "freeze rules" have not yet been given a real test in practice, and is inclined to amend, rather than repeal them. The commission has corrected an incorrect reference in proposed sec.80.205 to refer to sec.80.105, rather than sec.80.60. Several commenters suggested that proposed sec.80.203(a)(1) be amended so that it does not require the executive director to prepare a draft permit if the executive director does not recommend the issuance of a permit. The commission disagrees, and declines to make this change, in part because the "freeze rules" were the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome, and in part because the failure to prepare a draft permit would present an almost insuperable barrier to an applicant should the applicant prevail on the issue of whether or not a permit should be issued. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.207(c) be amended to eliminate the additional time proposed beyond the first discovery period for filing a list of issues. The commission disagrees, and declines to make this change. An earlier version of this rule required protestants to have their issues list finished simultaneously with the end of the first discovery period, which the commission believes compresses the work that must be done. The commenter suggested that in the event the additional time remained, additional time should be added to proposed sec.80.207(e) as well. The commission disagrees and declines to make this change, since additional time is already granted by timing the applicant's response from the time the first list of issues is submitted, rather than the close of the first discovery period. Several commenters commented that proposed sec.80.207(d) allows an applicant to disrupt the work required of protestants to comply with subsection proposed sec.80.207(c), and suggested the deletion of the second sentence in subsection (d). The commission disagrees, and declines to make this change. The commenters apparently missed the time extension given in proposed sec.80.207(c), which now allows for completion of the issues list "within 20 days after the end" of the time period originally contained in old sec.265.104, from which the proposed section is derived. The result of the proposed sections is to give the protestant an additional 20 days to complete the issues list, while allowing the applicant to go forward with discovery. The result, rather than an additional burden on the protestant, is an easing of requirements. One commenter suggested that proposed sec.80.207(h) be amended to allow a limited amendment of the application in some circumstances. While the commission agrees that this commenter's point has some merit, the current arrangement was the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.209(c)(3) be amended to require the judge to distribute a prehearing order within four days from the prehearing conference. While the commission recognizes the commenter's concern and the limited (14-day) time period between the prehearing conference and the hearing, it prefers at this time to leave the timing of the prehearing order to the judge, trusting that prehearing orders will be distributed as soon as possible considering the compressed time frame. Two commenters suggested that proposed sec.80.213 be revised to make it clear that paragraph (1)(A) and (B) is not mutually exclusive and that the judge may direct a party to both voluntarily reduce its listed witnesses and provide a summary of the expected testimony of each witness. One commenter also suggested that the language of the rule be made more clear that the judge may prohibit testimony of witnesses. The commission agrees, and has amended the section accordingly. Several commenters suggested that proposed sec.80.259 be revised to eliminate a provision that would allow a judge to file an amended proposal for decision without serving it on the parties. This provision was included in a redline/strikeout version of the proposed rules distributed by agency staff during the rulemaking process, but was dropped from the proposed rule before publication, and thus no revision to the proposed rule is necessary. The staff regrets any inconvenience caused by failing to notify interested persons of the change before publication. The commission has amended proposed sec.80.263 to make it clear that the general counsel may set time limits for oral presentations before the commission. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.sec.80.265, 80.267, and 80.271 to remove the word "final" where it refers to commission decisions or orders, because the use of the word in these proposed sections may be unintentionally confusing when compared with the use of the word in Government Code, sec.sec.2001.141-2001.144, dealing with when decisions become final. One commenter suggested that the provision of proposed sec.80.267(b) that the commission will render a decision within 60 days after the date the hearing is finally closed does not give the commission enough time to render its decisions. The commenter suggested lengthening the time period to 90 days. The commission agrees that cases heard by a judge may take more than 60 days, but notes that the 60-day period is mandated by Texas Government Code, sec.2001. 143 unless extended. The commission believes, however, that proposed sec.80. 267(b) gives the judge enough flexibility to extend the time, and therefore declines to make the suggested revision. The commission has amended proposed sec.80.277 to more clearly reflect the commission's position and longstanding agency practice that the executive director or an authorized representative may forward an enforcement order to the attorney general for enforcement. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.86.18(c)(1)(C) to change the time period for filing applications for rehearing to 30 days to be consistent with Water Code, sec.11.316. One commenter suggested that the definition of "monitoring well" in proposed sec.340.2 be amended to expressly exclude monitoring wells used in conjunction with the production of coal and lignite, as is apparently intended by the general exclusion for wells used in conjunction with the production of "other minerals." The commission agrees, and has amended the section accordingly. One commenter noted that proposed sec.340.73 appears to differ from the requirements under discussion at the agency for sec.338.31 and sec.338.32 as to the persons to whom copies of well logs are to be submitted. The commission agrees, and has amended proposed sec.340.73 and sec.340.75 to add local underground water conservation districts and make these sections consistent. The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.1.1. Purpose of Rules. The purpose of the commission's rules is to implement the powers and duties of the commission under the Texas Water Code, the Texas Health and Safety Code, and other laws, to establish the general policies of the commission, and to set forth procedures to be followed in agency proceedings. The rules should be interpreted to simplify procedure, avoid delay, save expense, and facilitate the administration and enforcement of state and other laws by the agency. sec.1.5. Records of the Agency. (a) Subject to the limitations provided in the acts administered by the commission and the Public Information Act and copyright law, information collected, assembled, or maintained by the agency is public record open to inspection and copying during regular business hours. (b) If classified data of the federal government or confidential information in the records of the agency is the subject of an open records request under the Public Information Act, the executive director may submit a request to the Texas attorney general under Texas Government Code, sec.552.301, seeking a determination that the information is within an exception to the requirement to provide the information to the public. (c) Subject to the limitations of this section, the agency will provide copies of its records upon request. The agency may furnish copies at the rates published in its operating procedures, or may contract for the copies to be made at the expense of the person requesting them. The agency may charge the fees specified in Texas Government Code, sec.603.004 for the reproduction services listed in that section. The agency may waive a charge if the cost to the agency to collect the charge will exceed the amount of the charge. Copies may be certified by the executive director or the chief clerk. (d) Confidentiality of information. (1) A person submitting information to the agency may request that the information be designated as classified data of the federal government, or as confidential. Each claim of classified data or confidentiality must be made upon submission, and each page must be stamped "confidential," or the material will be considered available for public review. Confidential information is information relating to trade secrets, secret processes, or economics of operation, or information that if made public would give any advantage to competitors or bidders, and includes confidential information under 5 United States Code, sec.552(b)(4), 18 United States Code, sec.1905, and special rules cited in 40 Code of Federal Regulations, sec.sec.2. 301-2.309; provided, however, that the composition of any defined waste subject to the jurisdiction of the commission may not be regarded as confidential information. (2) If the commission or executive director agrees with the designation, the agency will not provide the information for public inspection. The agency may return classified or confidential information to the person providing it if the person so requests and the information has served the purpose for which it was submitted. (3) If a claim of classified data or confidentiality is not approved, the person submitting the information will be notified. If the person elects to withdraw the information, it will be withheld from public review until withdrawn. If the person who submitted the information is an applicant, the executive director shall not consider the information upon preparing the draft permit, and the commission and executive director shall not consider the information upon determining to grant or deny the application. (4) The name and address of an applicant or permittee will not be considered confidential. (5) For injection well applications, information which deals with the existence, absence, or levels of contaminants in drinking water will not be considered confidential. (6) This section shall not be construed so as to make confidential any effluent data, including effluent data in permits, draft permits, and permit applications. (7) For Texas pollutant discharge elimination system applications, information required relating to the contents of the application for permit will not be considered confidential. This includes information submitted on the forms themselves and any attachments used to supply information required by the forms. (8) This section does not create privileges from discovery of documents in contested case hearings under Chapter 80 of this title (relating to Contested Case Hearings). sec.1.7. Computation of Time. In computing any period of time prescribed or allowed by commission regulation or orders or by any applicable statute, the period shall begin on the day after the act, event, or default in question and shall conclude on the last day of that designated period, unless it is a Saturday, Sunday, or legal holiday on which the office of the chief clerk is closed, in which event the period runs until the end of the next day that is neither a Saturday, Sunday, nor a legal holiday on which the office of the chief clerk is closed. sec.1.10. Document Filing Procedures. (a) All documents to be considered in a commission meeting or by judges in contested cases shall be filed with the chief clerk. Hearing requests and responses shall also be filed with the chief clerk. (b) If a docket number has been assigned, it should appear on the first page of all filed documents. (c) Documents shall be filed by mail, facsimile, or hand delivery. If a person files a document by facsimile, he or she must file with the chief clerk the appropriate number of copies by mail or hand delivery within three days. (d) The original or one copy of a document shall be filed, except for documents to be considered at a commission meeting. For documents to be considered at a commission meeting, 11 copies shall be filed. (e) The time of filing is upon receipt by the chief clerk as evidenced by the date stamp affixed to the document by the chief clerk, or as evidenced by the date stamp affixed to the document or envelope by the commission mail room, whichever is earlier. (f) The chief clerk shall accept all documents presented for filing. The chief clerk's acceptance is not a determination that a document meets filing deadlines or other requirements. (g) If the requirements of this section are not followed, the commission, or a judge in a SOAH proceeding, may choose not to consider the documents. In the absence of a waiver under subsection (h) of this section, the commission may choose not to consider documents filed within two days of a commission meeting. (h) The judge may waive one or more of the requirements of this section, or impose additional filing requirements in SOAH proceedings. The commission or general counsel may waive one or more of the requirements of this section, or impose additional filing requirements for commission meetings. (i) This section does not apply to offers of evidence during a hearing. sec.1.11. Service on Judge, Parties, and Interested Persons. (a) For responses and replies to responses concerning hearing requests filed under Chapter 55 of this title (relating to Request for Contested Case Hearing), copies of all documents filed with the chief clerk shall be served on the executive director, the public interest counsel, the applicant, and any persons filing hearing requests, no later than the day of filing. (b) For contested case hearings referred to SOAH, copies of all documents filed with the chief clerk shall be served on the judge and all parties or their representatives no later than the day of filing. (c) All documents filed and served under these rules, except as otherwise expressly provided in these rules, may be served by delivering a copy to the party to be served, or the party's duly authorized agent or attorney of record, as the case may be, either in person or by agent or by courier-receipted delivery or by mail, to the party's last known address, or by telephonic document transfer to the recipient's current telecopier number, or by such other manner as the commission or judge in their discretion may direct. (d) Service by mail is complete upon deposit of the document, enclosed in a postpaid, properly addressed wrapper, in a post office or official depository under the care and custody of the United States Postal Service. Service by courier-receipted delivery is complete upon the courier taking possession. Service by telephonic document transfer after 5:00 p.m. local time of the recipient shall be deemed served on the following day. Service by telephonic document transfer must be followed by serving an extra copy in person, by mail, or by carrier receipted delivery within one day. Judges may impose different service requirements in SOAH proceedings. (e) Whenever a party has the right or is required to do some act within a prescribed period after the service of a document upon the party and the document is served by mail or by telephonic document transfer, three days shall be added to the prescribed period. Three days will not be added when documents are filed for consideration in a commission meeting. (f) The party or attorney of record shall certify compliance with this rule in writing over signature and on the filed instrument. A certificate by a party or an attorney of record, or the return of an officer, or the affidavit of any person showing service of a document shall be prima facie evidence of the fact of service. (g) Nothing herein shall preclude any party from offering proof that the notice or instrument was not received, or, if service was by mail, that it was not received within three days from the date of deposit in a post office or official depository under the care and custody of the United States Postal Service, and upon so finding, the commission or judge may extend the time for taking the action required of such party or grant such other relief as they deem just. The provisions hereof relating to the method of service of notice are cumulative of all other methods of service prescribed by these rules. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606772 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 239-1966 Chapter 3. Definitions 30 TAC sec.3.1, sec.3.2 The commission adopts new sec.3.1 and sec.3.2, concerning procedural rules. Section 3.2 is adopted with changes to the proposed text as published in the February 20, 1996, issue of the Texas Register (21 TexReg 1352). Sections 3.1 is adopted without changes and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. Comments were received from Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts. Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts generally supported the adoption of the proposed sections with some changes. Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund, while apparently not opposing the adoption of the proposed sections as a whole, generally expressed concerns related to public participation and issues related to delegated federal programs. A number of commenters suggested minor editorial, typographical, and grammatical changes to clarify or shorten the proposed sections. The commission generally agrees with these suggestions, and has amended the proposed sections accordingly. These changes have been made to proposed sec.sec.1.1, 1.5, 1.7, 1.10, 1.11(a), 3.2, 5.3, 5.8, 5.10, 5.11, 5.12, 5.14, 10. 1, 10.2, 10.3, 10.6, 10.8, 20.17, 40.5, 40.6, 40.8, 40.9, 50.13, 50.17, 50.31, 55.21, 55.23, 55.25, 55.27, 55.29, 55.31, 70.2, 70.3, 70.4, 70.5, 70.6, 70.7, 70.8, 70.9(b), 70.10, 70.11, 70.101, 70.102, 70.104, 70.107, 70.108, 70.109, 80.3, 80.11, 80.17, 80.21, 80.23, 80.29, 80.31, 80.33, 80.109, 80.111, 80. 113(c), 80.115, 80.119, 80.127, 80.133, 80.155, 80.201, 80.205, 80.207, 80.209, 80.213, 80.251, 80.253, 80.257, 80.265, 80.267, 80.271, 86.1, 86.11, 86.15, 86.16, 86.34, 86.55, 86.96, 86.98, 86.99, 86.130, 86.131, 86.132, 340.41(b), 340.43(d), 340.45, 340.53(d), 340.71, 340.73, and 340.131. The titles of proposed sec.sec.10.9, 20.19, 40.5, 40.6, 40.8, 50.39(e), 55.31, 70.109, 80.5, 80.23(b), Chapter 50, Subchapter B and Chapter 86, Subchapter D have also been amended for clarity and to reflect their true content. Several commenters commented generally that the proposed sections limit public participation in permit and enforcement actions more stringently than allowed under federal law and do not meet the minimum requirements for federal program approval, basing this comment in part on a draft report prepared by one of the commenters. The commission disagrees. The commenters very narrowly construe the concept of public participation, and the commission does not agree that the statistics contained in the draft report are accurate. The commission does not agree that such a narrow emphasis on contested case evidentiary hearings at the expense of other methods of public participation is either fair or appropriate. The commission also does not agree that the proposed sections impose new limits on public participation. Although the commission's process will be continually reviewed and improved, the process and the proposed sections are consistent with the "United States Environmental Protection Agency's (EPA) Policy Statement of Public Participation," which contains no requirement for contested case hearings on every permitting matter. Public notice is given in compliance with statutory requirements, and when questions or comments from the public are received, the agency's technical staff responds to them. Agency permit engineers and attorneys spend a considerable amount of time answering questions from the public, meeting with them, educating citizens on both the scientific and legal requirements of permits. As questions are raised, staff reconfirms the review and position it is taking on permits. When there is considerable public interest expressed, the agency often will hold one or more public meetings in the local area to encourage give and take between the public, the applicant, and the staff. This is in addition to public meetings that may be required by statute (e.g., Texas Health and Safety Code, sec.361.0791, on hazardous waste management permits). Most importantly, the commenters overlook the provisions of the proposed sections which in fact dramatically increase the opportunity for public participation-now, every motion for reconsideration of an executive director's action goes directly to the commission, and every hearing request is placed on a commission meeting agenda with the right of the requestor to share information and concerns directly with the three commissioners. Most determinations on hearing requests, prior to September 1, 1995, were handled by the Office of Hearing Examiners with little, if any, involvement by the commissioners. The public now has the ability to submit information and concerns to the commissioners, very often has the ability to personally address the commissioners, and the commissioners have the ability to require the applicant and the executive director's staff to respond to those concerns. The exchange takes place in a posted, public hearing. This satisfies the "exchange of views and open exploration of issues, alternatives, and consequences" standard contained in the EPA Policy Statement. Although the commission believes that the proposed sections represent a dramatic improvement, the commission continues to explore ways to enhance this exchange of views. Several commenters suggested that the commission failed to provide notice of the procedural rule changes to the EPA as required. The commission disagrees. The commenters erroneously interpret 42 United States Code, sec.300h- 1(b)(1)(A)(ii) to require notice prior to final adoption of this rule package. Correctly read, the statute only requires notice of a rule change to the EPA after final adoption of an underground injection well program or changes to the program. Upon adoption of this package, the commission will provide appropriate notice to the EPA. One commenter suggested that proposed sec.1.1 be expanded to address both the purpose and scope of the commission's rules. The commission disagrees with this proposal because the language proposed would state what is already law, that the rights of parties and the commission's powers are established by statute and cannot be enlarged by rule, and that the statutes prevail if the commission's rules are in conflict with them. Several commenters criticized the commission's handling of confidential documents under current rules being revised and adopted as proposed sec.1.5. The commission disagrees with these comments because the commission's management of confidential documents complies with all applicable requirements. Another commenter proposed additional language for this section which would specify the duties of the agency's central records office. The commission disagrees, because the proposed directives concerning internal office procedure can be made without adopting the directives as a rule. The commission notes that it has recently directed its executive director to evaluate the agency's record management practices. This evaluation is already under way, and will include the agency's handling of confidential documents to ensure they are not inadvertently disclosed to the public. A request for proposal has been published for a study on the matter. One commenter suggested that proposed sec.1.11 be amended to make it clear what is included in the phrase "courier-receipted delivery service." The commission believes that the phrase is sufficiently clear, and declines to add any definition beyond that already provided in Texas Rule of Civil Procedure 21a. The commission believes that the modifications to proposed sec.1.11 described as follows may also resolve the commenter's concerns. One commenter noted that proposed sec.1.11 and sec.10.10 appear to be missing subsection (e), which appears in old sec.261.18, from which they are derived. The commission agrees. This deletion was inadvertent, since proposed sec.1.11 and sec.10.10 were intended to include the provisions of old sec.261.18. Proposed sec.10.10 duplicates proposed sec.1.11 and has been deleted, and subsection (e) has been added to proposed sec.1.11. In addition, the commission has further clarified proposed sec.1.11 by more closely tracking Texas Rule of Civil Procedure 21a, which the commission believes covers the same subject matter more completely, and has amended and renumbered subsections accordingly. One commenter suggested that proposed sec.3.2 be revised to incorporate several definitions currently contained in other chapters. The commission agrees in part, and has added definitions of "enforcement action" and "enforcement order" to proposed sec.3.2. Other definitions not moved are used only in single chapters, and the commission believes it more useful to leave those definitions in the chapter to which they apply, rather than move them to a general definitions section. The commission intends, however, to continue to consolidate widely used definitions in Chapter 3 for clarity and consistency. One commenter suggested that the definition of "advisory committee" in proposed sec.5.2 be condensed. The commission agrees, and has amended the proposed section accordingly. This commenter also suggested that this definition be moved from proposed sec.5.2 to proposed sec.3.2. Since this term seems to be used only in proposed Chapter 5, the commission disagrees and has left the definition in proposed sec.5.2. One commenter suggested that proposed sec.10.7 be amended to clarify that the commission will keep a certified agenda of closed meetings held in accordance with the requirements of the Texas Open Meetings Act. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.10.9 and sec.10.10 duplicate proposed sec.1.10 and sec.1.11, and suggested that the proposed sections appear only in proposed Chapter 1. The commission agrees, and has deleted proposed sec.10.10 and amended proposed sec.10.9 to change its title and refer to proposed sec.1.10 and sec.1.11. One commenter suggested that proposed Chapter 40 be amended to allow participation in Alternative Dispute Resolution (ADR) by "interested parties" and to allow mediation to occur before a request for hearing is made. While the commission wholeheartedly supports ADR efforts, it disagrees for two reasons, and declines to make the change. First, participation in ADR in contested cases must necessarily be limited to the parties to the case, or at the hearing request stage, to those filing hearing requests as well. Without this limitation, the commission believes it will be difficult for participants to commit to a process where the number and identity of negotiating parties is subject to change. Second, while the commission is strongly committed to ADR, and encourages its use at all stages of the application process, it believes that it is wiser to continue to encourage informal ADR outside of agency rules prior to entry into the contested case process, and leave its use up to the participants, rather than attempt to promulgate rules governing its use at this time. One commenter suggested that the definition of the term "alternative dispute resolution office" in proposed sec.40.2 be replaced with a definition of the term "alternative dispute resolution director" because the latter is used throughout proposed Chapter 40. The commission agrees, has amended the proposed section accordingly, and has also amended proposed sec.40.5(a)(1) accordingly. One commenter suggested deleting the words "regardless of which ADR method is used" from the definition of "mediator" in proposed sec.40.2, as not adding to the definition. The commission disagrees, because it believes that the term "mediator" is used in some circles as a term of art to refer only to a person engaged in specific dispute resolution procedures, and the term is used in these proposed sections in a more inclusive manner. One commenter suggested using the word "applicant" rather than a longer term in the definition of "participant" in proposed sec.40.2, and adding "named parties" to the definition to make clear that they are included in the definition. The commission agrees, and has amended the proposed section accordingly. One commenter suggested deleting the words "from the pool of mediators" from the first sentence of proposed sec.40.4(a) and adding clarifying language regarding private mediators, to make the proposed section more consistent with the other proposed sections of the chapter. The commission agrees, and has amended the proposed section accordingly. One commenter suggested rewording proposed sec.40.4(c) for brevity and clarity. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.40.6 could be read to exclude the possibility of a matter being referred to ADR after a draft permit is proposed and a protest letter received, but prior to the matter being referred to the State Office of Administrative Hearings (SOAH), as proposed sec.55.25(d)(1) anticipates, and suggested amending the proposed section. The commission agrees with the commenter that this can be the most productive period for ADR, expressly desires to encourage ADR at this point, and has amended the proposed section to make it clear that cases may be referred to ADR at this point and that ADR outside of the commission process may be used at any time. Several commenters commented that proposed sec.50.13 and sec.50.33 allow the commission and its executive director to act on an application without considering any comments, and generally maintain that the proposed sections of procedural rules as a whole preclude public comment. The commenters also claim that the provisions of proposed sec.50.33 which prevent action by the executive director where there is a "protest" and the provision for motions for reconsideration are not an adequate substitute for a public comment process. The commission disagrees, and declines to amend the proposed sections. Proposed sec.50.13 and sec.50.33 allow action without a contested case hearing, which is not equivalent to action without considering comments. The procedures contained in the proposed procedural rules sections are, for the most part, in addition to the commission's public comment process, rather than a substitute for them, as the commenters apparently assume, and the equation of participation in a contested case hearing with public comment is inappropriate. The commission actively encourages public participation, and has gone on record repeatedly to express this and to broaden public participation, but believes that the amendments suggested by the commenters go far beyond the scope of this rulemaking. One commenter suggested that proposed sec.50.39 be amended to allow only an "affected person" to file a motion for reconsideration of an executive director's action on an application, suggesting that the term "other person" is too broad. The commission disagrees, and declines to change the proposed section, because the proposed language gives the commission flexibility to reconsider decisions in situations where the error complained of merits attention regardless of who raises it. Additionally, allowing any person to file a motion for reconsideration allows another avenue for public comment by bringing concerns directly to the attention of the commission. The commission believes, however, that the question of whether a person filing a motion for reconsideration is an affected person will in some cases have a bearing on whether the commission acts on the motion. Several commenters criticized proposed sec.55.21(b) and (d), claiming that because of multiple publications, it may be difficult to tell when the deadline for a hearing request occurs. While much of the timing and many of the contents of notices are specifically required by statute, to the extent that this becomes a problem, the commission plans to deal with it in rulemaking on a new proposed chapter governing public notice, rather than in this rulemaking. Several commenters suggested that proposed sec.55.21(c) constitutes an unlawful delegation and allows the person who designs a notice to decide what will be required in a hearing request. The commenters further assert that the proposed section does not adequately plan for errors in the published notice. The commission disagrees, and declines to change the proposed section. The statutes and other sections of the commission's rules dictate the content of public notices, and this proposed section merely requires hearing requests to comply with those requirements, if any. If the notice is defective, this must be generally cured through republication, thus giving another chance to comply with any requirements. Several commenters criticized proposed sec.55.21(e) for not establishing procedures for requesting extensions of time and suggested the inclusion of a "good cause" or public interest test. The commission disagrees. This section is primarily intended to allow the commission to consider late hearing requests. The commission believes that the proposed section allows more flexibility for the commission and the public than the suggestion does, and declines to change the section. One commenter suggested that proposed sec.55.23(b) be revised to require a group or association to provide an explanation of its hearing request with sworn affidavits, written resolutions, or other satisfactory documentation, rather than to allow other parties to request such an explanation. The commission disagrees. While the proposed sections anticipate that a group or association will submit such information, requiring this as an absolute requirement in advance when the group or association's qualifications are not in dispute is burdensome and unnecessary. However, allowing the listed parties to request that evidence, if they believe it to be an issue, protects the integrity of the hearing process and the rights of the applicant while limiting evidence and testimony to those issues that are actually in dispute. Several commenters suggested that proposed sec.55.23(b) and sec.55.26(f) place unreasonable burdens on the public in replying to responses to hearing requests. There is no proposed sec.55.26 and the latter reference is apparently to proposed sec.55.25(f). The commission disagrees, because these proposed sections merely provide a way for the commission and other parties to determine the basis of a hearing request, which is clearly relevant under Texas Water Code, sec.5.115. While the commission does not agree that the proposed time periods are unreasonable, it has determined that the time for replying to responses to hearing requests in proposed sec.55.25(f) should be lengthened from ten days to 14 days to give requestors more time to prepare, and has amended proposed sec.55.25 accordingly. Several commenters suggested that the commission amend proposed sec.sec.55.25, 55.27, 55.29, and 55.31, to change the way the commission deals with hearing requests and with determinations of whether a person is an "affected person," whether a request is "reasonable," and what constitutes "competent evidence" under Texas Water Code, sec.5.115. The commission agrees that these items may need further attention, but, as announced at the beginning of this phase of rulemaking and stated in the preamble to these proposed rules, has reserved this issue for further rulemaking, once sufficient experience has been accumulated with the existing process to fairly evaluate how well the existing rules are working. This project is already underway at the agency, and the commission expects that it will get into full swing shortly after this rulemaking project is concluded. While some minor adjustments to the current process are included in this round of rulemaking, the commission declines to make the suggested major changes in this round of rulemaking. Several commenters suggested that the proposed sections place an unreasonable burden on who can qualify for a hearing and claimed that the commission has not implemented its authority to provide for public participation in hearings. The commission disagrees. As noted previously, the commission believes that the proposed sections broadly encourage public participation. In addition, the proposed sections are entirely consistent with the law on hearings and standing. Finally, the commission is already committed to reviewing this process in another round of rulemaking. Several commenters suggested that proposed sec.55.25(g) be revised to allow a legislator (for an activity in the legislator's district), a state agency, a federal agency, or a local government (for a facility within the local government's jurisdiction) to send an application directly to SOAH for a contested case hearing. The commission disagrees. Nothing in the statutes grants such blanket rights, and the commission believes that adding this provision would violate both the letter and intent of Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115, as well as other specific statutes dealing with contested case hearings, and therefore declines to make this change. One commenter noted that the provisions of proposed sec.55.27 and sec.55.29 do not appear to address instances where the definition of affected persons in the rule (and in Texas Water Code, sec.5.115) may differ from specific statutory provisions defining "affected person" or "person affected," and suggested that the proposed sections be revised to make it clear that specific statutory provisions control. In the alternative, the commenter suggested that the commission apply both the definition of "affected person" in the proposed sections and any specific statutory definition. The commission agrees with the commenter that Texas Water Code, sec.5.115, the proposed sections, and other specific statutes can and should be read together. Generally, Texas Water Code, sec.5.115 will require a "personal justiciable interest," while other specific statutory provisions delineate those interests, specifying distance limitations or identifying specific persons who can request a hearing. The commission believes that the provisions of proposed sec.55.27 (that a hearing request be granted if it is "pursuant to a right to hearing authorized by law") and proposed sec.55.29 (that a relevant factor in determining whether a person has "a personal justiciable interest related to a legal right, duty, privilege, power, or economic interest affected by the application" is "whether the interest claimed is one protected by the law under which the application will be considered") require Texas Water Code, sec.5.115 and any applicable specific statute to be read together. Thus, the commission declines to modify the proposed sections. Several commenters suggested that proposed sec.55.27(b) and (c) be amended on the grounds that they conflict with statutory provisions such as Texas Water Code, Chapter 27, in which counties are granted hearings regardless of a showing of standing or reasonableness of their hearing requests. The commenters also suggested that the test for a state agency or local government needs to be clarified, alleging, for example, that a county is automatically an affected person for an activity in that county. The commission disagrees. No statute, other than those giving party status to the executive director, public interest counsel, Texas Water Development Board, and Texas Parks and Wildlife Department, provides as a blanket rule that a governmental entity is automatically an affected person for all activities in a geographic area, although some do in specific instances. Texas Water Code, sec.27.018, for instance, provides for a hearing on an injection well permit application if one is requested by a "local government." The statute further distinguishes between the terms "local government" and "affected person"-a distinction that does not appear in Texas Water Code, sec.5.115. While there may be some confusion over the use of the term "affected person" in more than one context, the commission believes that it is clear that a hearing request by a local government under Texas Water Code, sec.27.018 meets the tests of reasonableness and being "pursuant to a right to hearing authorized by law" under proposed sec.55.27(b) and "in the public interest" under proposed sec.55.27(c), and that a governmental entity may be an affected person given the definition of "person" contained in proposed sec.3.2 and its "authority under state law" in proposed sec.55.29(b). The commission further believes that the tests for a state agency or local government are sufficiently clear, and therefore declines to amend the proposed sections. Two commenters suggested that the provisions of proposed sec.55.27(c), which allow the commission to refer an application to SOAH for hearing if the commission determines that a hearing would be "in the public interest" even if there is no valid hearing request, be deleted or that the commission delineate standards it will use in making this determination. Several commenters suggested that the provision is vague in that it does not define "public interest." The commission disagrees with these comments and declines to make the suggested changes, in that it believes that there may be situations where the public interest demands a hearing (one example might be information received after the deadline for hearing requests), and also believes that it would be impossible to define "public interest" at this time in terms more specific than those used by the statutes under which the commission operates. One commenter suggested that proposed sec.55.27(c) be deleted as duplicative of proposed sec.55.27(b)(1). The commission disagrees and declines to make the proposed change. Proposed sec.55.27(b)(1) allows a commissioner, an applicant, or the executive director to request a contested case hearing and thereby refer a case to SOAH, while proposed sec.55.27(c) allows the commission as a whole to vote to send a case to SOAH. The two provisions serve different purposes and the commission believes they should be kept separate. Several commenters suggested that the commission's rules on notice need significant changes, and suggested that proposed sec.55.27(c) be amended to prohibit the final notice on a permit from being issued before technical review is complete and a draft decision is available. The commission does not agree that these proposed sections are the place to deal with notice requirements, notes that no notice has been given to the public or interested parties that notice requirements would be changed in these proposed sections, and points out that it is in the process of preparing for publication a new chapter to consolidate many of its notice rules. However, the commission disagrees with the commenters that the existing rules regarding notice are inadequate or restrict public participation. Proposed sec.55.27(c) does not deal with notice, but rather allows the commission to refer an application to SOAH even if there is no hearing request, and the commission does not agree that amending it to deal with notice would be appropriate or advisable. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear whether an administrative law judge can overrule a commission denial of a hearing request based on standing. The commission has amended proposed sec.55.27(f) to make its position on this issue more clear-that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear what must be done to appeal the denial of a hearing request, do not make it clear when the time period for appeal begins to run, and add new burdens by requiring two appeals. The commission does not agree, and declines to further amend the proposed sections beyond the amendments already described. The proposed sections make it clear that a party whose hearing request is denied must seek to obtain party status and then, if unsuccessful, follow procedures for a motion for rehearing as a prerequisite to appeal once the commission has disposed of the application. Since a person who files a hearing request is asking that a contested case hearing be held, that party obtains the relief sought if any hearing request is granted. That person must then seek to be admitted as a party if the person wishes to participate in the case, and decisions on that issue will be handled as they are now, although the commission anticipates that if the person has a complaint at this point, it will be the denial of party status or a limitation of issues rather than a determination on a hearing request. If all hearing requests are denied or withdrawn, persons whose requests are denied have an opportunity for the review of that decision by filing a motion for rehearing after the commission's decision on the application -that is, at the end of the case, rather than in an interlocutory appeal, as the commenters seem to suggest. The commission believes that it is clear in the proposed sections that the time period for appeals begins to run at this point. While the commenters also suggest that it is unreasonable to force parties to go through a hearing and have the result of that hearing reversed by a court based on an error in denying party status, the commission believes that the risk of this kind of result is minimal, is inherent in every determination of party status in any kind of proceeding, and is outweighed by the burden to the public that would be imposed by delaying every permitting decision until determinations of party status are appealed through the court system. Two commenters noted that proposed sec.55.27(f) allows a person whose hearing request is denied to still seek to be admitted as a party, and suggested that absent some compelling reasons, the commission's determination on the hearing request should preclude the later admission of the person as a party. The commission disagrees, and has amended the proposed section as noted previously to make it clear that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. One commenter suggested that proposed sec.55.27 be amended to allow a motion for reconsideration, rather than a motion for rehearing, of the denial of a hearing request, suggesting that the latter is only appropriate in contested cases under the Administrative Procedure Act, and that no contested case arises if a hearing request is not granted. The commission disagrees. As stated previously, the commission believes that a decision on the validity of a hearing request is an interlocutory decision only on the validity of the request, and does not necessarily dictate the outcome of a later decision on party status, or standing. The commission believes that a motion for rehearing at the conclusion of the proceedings is the most appropriate way to review such a decision. Several commenters remarked that the proposed sections do not allow for an adequate record for judicial review when no contested case hearing is held and do not establish standards for a court to use in its review. The commenters also suggest that the proposed sections do not create an adequate record in rulemaking. The commission disagrees, and declines to make changes based on this comment, because it believes that the record created is sufficient for judicial review of the commission's actions, and the standards of review are already clearly established in the statutes and rules. Similarly, the commission believes that the record created in rulemaking proceedings is more than adequate. Several commenters suggested that proposed sec.55.29 and sec.55.31 be revised to provide that the commission accept as true written statements of a person filing a hearing request for the purposes of the determination on the request or the person requesting a hearing be given an opportunity to present evidence to meet the burden of presenting competent evidence under Texas Water Code, sec.5.115. The commission disagrees and declines to make these changes. The first alternative ignores the clear intent of Texas Water Code, sec.5.115, by allowing a person to meet its standards by simply claiming that the standards are met. Texas Water Code, sec.5.115 provides that the commission "is not required to hold a hearing if the commission determines that the basis of the person's hearing request is unreasonable or is not supported by competent evidence." The second alternative does not recognize that this determination will require different procedures in different cases, and the flexibility which the proposed sections provide-from a decision on the pleadings to oral argument to an evidentiary hearing-allows for procedures to be followed which are appropriate for the cases presented. For example, a permit renewal under Texas Health and Safety Code, sec.382.056 may be an example of a case where requests not alleging increases in emissions or compliance problems can be dealt with on the pleadings alone. Similarly, a person who cannot allege a reasonable basis for a hearing request or who cannot allege that competent evidence exists to support the request, despite having more than one opportunity to do so (the request itself, a reply filed under proposed sec.55. 25(f) to responses that point out the merits or deficiencies of the request, and, in appropriate cases, argument or testimony before the commission) is not going to be able to present such evidence at a hearing, and it may be appropriate to resolve this request without an evidentiary hearing. Several commenters suggested that proposed sec.55.31 is unconstitutionally vague and conflicts with other Texas Natural Resource Conservation Commission rules and the law, specifically proposed sec.55.29 and Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115 and that the provisions of proposed sec.55.31(b)(3) are overly burdensome on public participation. The commission disagrees. The commission believes that the proposed section fully complies with the constitution and with Texas Health and Safety Code, sec.382. 056 and Texas Water Code, sec.5.115. The term "reasonableness" is adequately defined by proposed sec.55.31. Further, proposed sec.55.31 does not conflict with proposed sec.55.29, because they deal with different matters -the first with the determination of whether a person is an "affected person," and the second with whether a hearing request is "reasonable." Several commenters suggested that the proposed rules be revised to "provide that the commission will make determinations and record those determinations so that the public can understand the basis for its government's decision and so that a reviewing court can determine if the actions of the commission should be affirmed or reversed." As noted previously, the commission believes that the proposed sections do exactly that and declines to make changes based on this comment. Several commenters suggested that proposed sec.55.33(a)(3) (and presumably proposed sec.80.5(a)(3)) be revised, claiming that the proposed section requires the Chief Clerk to pay the cost for issuing public notices. The commission disagrees, since the proposed section requires the clerk to issue notice and does not provide for the Clerk to pay the cost of notice, since applicants are clearly responsible for those costs. Proposed sec.55.33 has been withdrawn, however, and only proposed sec.80.5 now governs the Chief Clerk's actions in this context. Several commenters noted that the setting procedures of proposed sec.55.33 largely duplicate those of proposed sec.80.5, and suggested the deletion of one or the other. Some commenters suggested conforming these two proposed sections. The commission agrees that these sections are duplicative and should be conformed, and notes as well that proposed sec.70.109 largely duplicates both of these sections. For clarity, the commission believes that it is most logical to lay out all setting procedures only in proposed Chapter 80, and has deleted proposed sec.55.33 and amended proposed sec.70.109 accordingly. Several commenters suggested that the proposed sections of proposed Chapter 70 limit public participation in enforcement proceedings in a fashion that does not meet the federal requirements for such participation and further state that notice in the Texas Register is insufficient. The commission disagrees, and declines to change the proposed sections. The agency complies with federal authorization rules regarding public participation in enforcement matters, which require the agency to have procedures in place for responding to citizen complaints, publish notice of settlements of civil actions, and give assurance that it will not oppose intervention by any citizen when permissive intervention is authorized by statute, rule, or regulation. In regard to the comment that Texas Register publication is insufficient, while the commission disagrees, it is currently considering alternative citizen participation in administrative actions. If rule changes are necessary after a decision is made on this issue, they will be taken up separate from this rulemaking. One commenter suggested that the definitions of "enforcement order," "enforcement action," "petition," and "respondent" be moved from proposed sec.70.2 to proposed sec.3.2. The commission agrees that the definitions of "enforcement action" and "enforcement order" should be moved to sec.3.2 since they are used in general context in other chapters of the agency's rules; however, the terms "petition" and "respondent," as they are defined in proposed Chapter 70, are specific to enforcement actions by the commission only and should remain in proposed Chapter 70. The commission does not believe that generic definitions of petition and respondent are necessary in proposed Chapter 3 to cover permitting matters because those terms are generally accepted legal terminology and "petition" is already included in the definition of "application." One commenter suggested that proposed sec.70.51 substantially changes old sec.337.71 from relating only to water rights enforcement matters to a more general mandatory enforcement hearing process. The commission disagrees. The language in proposed sec.70.51 was taken verbatim from old sec.337.71, except that the title of the subchapter was changed and references to other rules which had been renumbered were changed. The definitions included in old sec.337. 71 included water quality, water rights, hazardous waste releases, and references to the air statute as well. Although the title of old sec.337.71 indicated "Water Rights Enforcement," its statutory basis is Texas Water Code, sec.5.117, which applies to the agency as a whole, and requires the executive director to bring all instances of substantial noncompliance before the commission. The commenter expressed concern that proposed sec.70.51 would require mandatory hearings for incorrect compliance with record keeping requirements in an air permit. Since this would normally not be a substantial noncompliance under the air rules, this section would not apply in that case. Furthermore, old sec.337.71 and proposed sec.70.51 both exclude air violations, since a separate statutory requirement exists for the air program. The program most affected by this statutory requirement is the water quality program, which has a large amount of self-reporting data submitted each month. The proposed section basically sets forth the practice of the watershed management and enforcement divisions in processing this large volume of documents and describes how they determine what constitutes a substantial noncompliance. One commenter suggested that the concept of "executive director preliminary reports" (EDPR), used in proposed sec.70.101, is not necessary in proposed Chapter 70 and is not mandated by statute. While EDPRs are not required by statute, they are clearly allowed and anticipated by statute (see Texas Water Code, sec.sec.13.4151(c) and (d), 26.136(d) and (e), 27.1015(d) and (e), 34. 011(d) and (e) and Texas Health and Safety Code, sec.sec.341.049(c) and (d), 361. 252(d) and (e), 366.0924(d) and (e), 382.088(d) and (f), and 401.384- 401.385). This rulemaking does not alter the provisions in old Chapter 337 regarding preliminary reports, and sets forth the agency's procedures if preliminary reports are chosen as the form of pleading in a case. The executive director is not required to issue a preliminary report, but is given an option which may be used on a case-by-case basis, which is consistent with the statutory provisions. The commission disagrees with the comment and declines to change the proposed section. The commission has determined that the setting procedures of proposed sec.70. 109 largely duplicate those of proposed sec.80.5, and has amended them to simply refer to proposed sec.80.5. The commission has also amended the title of this section for clarity. One commenter suggested that proposed sec.80.3(a) be amended to make it clear that the judge sitting in a phase of a hearing, not the presiding judge, will resolve evidentiary questions raised during that phase of a hearing. The commission generally agrees, but believes that it may be necessary for a judge sitting in one phase of a hearing to refer some important evidentiary questions to the presiding judge, and has amended the section accordingly. Two commenters suggested that proposed sec.80.3(b)(10) be revised to make it clear that the judge may limit the time of presentation of evidence and witnesses without unfairly prejudicing the rights of parties. The commission agrees, and has amended the rule accordingly. In addition, the commission believes that splitting proposed sec.80.3(a) into two subsections and redesignating proposed sec.80.3(b) as sec.80.3(c) makes the proposed rule more readable, and has amended it accordingly. Two commenters suggested that proposed sec.80.5(b) be amended to expressly state that the commission may limit the issues that shall be considered by SOAH in a contested case. The commission agrees that this ability is implicit in Texas Government Code, sec.2003.047(e), and has amended the proposed section accordingly. These commenters also suggest that the proposed section be amended to provide that the commission "may," rather than "shall," identify issues to be addressed. Since Texas Government Code, sec.2003.047(e) uses "shall," the commission disagrees and declines to make this change. The commission has amended proposed sec.80.5(b) to make it clear that the executive director's petition or EDPR serves as the list of issues to be addressed by SOAH in a contested enforcement case. One commenter suggested that proposed sec.55.33(b) (the same as proposed sec.80.5(b)) be deleted, stating that while the commission may want to restrict or direct the list of issues, the proposed section suggests that a referral is not adequate if it does not. The commission disagrees, since Texas Government Code, sec.2003.047(e) clearly mandates an issues list, and since the proposed section gives the commission the flexibility to submit both broad and narrow ranges of issues. Several commenters suggested that proposed sec.80.13 be amended to allow parties, as well as the executive director, to request consolidation of related proceedings. The commission disagrees and declines to change the proposed section, because this is already allowed by the proposed sections. Proposed sec.80.13 allows the executive director to consolidate matters with the permission of the judge, and allows the judge to consolidate matters, presumably on the judge's own motion or that of any party. One commenter noted that due to changes in Chapter 291 of the commission's rules, proposed sec.80.17 does not accurately reflect the burden of proof in certain water and sewer rate cases. The commenter also noted that enforcement cases covered by subsection (c) of the rule should be expressly excepted from subsection (a). The commission agrees, and has amended the proposed section accordingly. One commenter suggested that proposed sec.80.27 be deleted as duplicative of proposed sec.sec.1.08, 1.10, 1.11, and 80.31. While the proposed sections cover similar matters, the commission disagrees and declines to make the change, because proposed sec.80.27 covers mostly matters of form, while the other proposed sections deal with more procedural matters. The commission has amended proposed sec.80.101 to make it clear that the executive director may either act on a matter remanded to the executive director or set it for consideration at a commission meeting. This is allowed by the proposed section, but the amendment lends clarity. One commenter suggested that proposed sec.80.107 is of sufficient importance that it should be dealt with as a separate subchapter. While the commission agrees that the proposed section is important, it prefers as a matter of form at this time not to create additional subchapters, and declines to make the change. One commenter suggested deleting the phrase "administrative law" from a reference in proposed sec.80.107(a)(3) to result in consistent references to the presiding officer as "judge." The commission agrees, and has amended the proposed section accordingly. One commenter suggested amending proposed sec.80.109(b) to define only statutory parties. The commission disagrees, and believes that the proposed section serves a more useful function by referring to all parties to an application, rather than just statutory parties, and declines to make this change. One commenter suggested deleting proposed sec.80.109(c) as duplicative of proposed sec.80.115. The commission agrees, and has amended the proposed section accordingly, renumbering the subsequent subsections. One commenter suggested deleting proposed sec.80.109(d) (now sec.80.109(c)) as duplicative of proposed sec.80.3(b)(5). The commission disagrees, since the section as amended in response to comments on proposed sec.80.115 now makes it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. One commenter suggested moving proposed sec.80.109(e) ((now sec.80.109(d)) to proposed sec.80.119, arguing that it makes more sense to discuss the effects of continuance in that section. The commission disagrees and declines to make the change. Proposed sec.80.109(e) (now sec.80.109(d)) is intended to make it clear that a person designated as a party retains party status regardless of any postponement of a hearing. Since the rule is limited to party status, the commission feels that it makes more sense to leave it in its present location. Several commenters commented that proposed sec.80.111 prohibits the judge and commission from considering comments. The commission disagrees, and points out that the section does not at all impair the executive director's ability to consider comments. The proposed section prohibits the judge from considering protests or comments submitted by non-parties in a non-evidentiary context (not under oath and without the opportunity to cross-examine) as evidence in contested case proceedings. The commission believes this is required by law, and declines to change the proposed section. The commission notes, however, that the phrase "[i]n proceedings other than enforcement proceedings" was inadvertently published as the end of the second sentence of this section, rather than as the beginning of the third sentence. The commission has amended the section accordingly, so that this limitation applies to questions submitted to the judge, not to the consideration of comments. One commenter noted that proposed sec.80.115 is not clear as to whether each and every party has a right to conduct discovery, present a direct case, cross- examine witnesses, obtain copies of pleadings, and so on, even when parties have been aligned under proposed sec.80.109. The commission agrees that the two provisions could be confusing when read together, and has amended proposed sec.80.109(d) to make it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. The commission anticipates that judges will exercise their best judgment when aligning parties and specifying the purposes for which they are aligned. One commenter suggested that proposed sec.80.117(b) be revised to make it clear that all persons granted party status are covered in the order of presentation. The commission agrees, and has amended proposed sec.80.117 by substituting the words "other parties" for the word "protestant." One commenter suggested deleting the word "SOAH" from proposed sec.80.119(d) to make it clear that the section does not restrict the judge in a contested case proceeding to the use solely of SOAH mediators. The commission agrees, and has amended the proposed subsection accordingly. The subsection has also been combined with proposed sec.80.119(c), to make the section shorter and more clear. One commenter suggested combining proposed sec.80.127(a)(2) and (c) to eliminate duplication. The commission agrees, and has amended the proposed section and renumbered subsections accordingly. One commenter suggested that proposed sec.80.127 be revised to more closely track the provisions of Texas Rule of Civil Procedure 267 and Texas Rule of Evidence 613, which prohibit the exclusion from the hearing room when "the rule" is invoked of an officer or employee of a party that is not a natural person and who is designated as its representative by its attorney and a person whose presence is shown by a party to be essential to the presentation of its case. The commission agrees, and has added subsection (f) to the proposed section so that it will more closely track the practice in the courts. One commenter suggested amending proposed sec.80.133 to allow the judge to set a schedule for the submission of written briefs. The commission agrees, and has amended the proposed section accordingly. Two commenters suggested that proposed sec.80.137 be amended to incorporate by reference Texas Rule of Civil Procedure 166a, because of the substantial body of interpretive case law and legal commentary available. The commission agrees that Rule 166a contains valuable guidance, and has tried to track the language of the rule in the proposed section as far as it considers appropriate given the difference between the administrative and judicial processes and the commission's assumption that the most likely use of the proposed section will be to limit issues, rather than to dispose of applications. The commission has accordingly modified the proposed section to track Rule 166a more closely, and anticipates that practitioners and judges will look to Rule 166a and the decisions construing it for guidance. Two commenters suggested that proposed sec.80.137 be amended to change some language relating to testimonial evidence. Because of the amendments noted previously, the commission believes the issue raised by this language to be resolved and declines to make further changes. One commenter suggested that proposed sec.80.151 be amended to expressly refer to Texas Rule of Civil Procedure 215. The commission disagrees, and declines to change the proposed section, because it believes that the grant of authority in Texas Government Code, sec.2003.047 and the sanctions provisions of proposed sec.80.107 already make sufficient provision for sanctions for discovery abuse. One commenter suggested that proposed Subchapter E of Chapter 80 (the "Freeze Rules") be deleted. While the commission recognizes the commenter's concern, it feels that the "freeze rules" have not yet been given a real test in practice, and is inclined to amend, rather than repeal them. The commission has corrected an incorrect reference in proposed sec.80.205 to refer to sec.80.105, rather than sec.80.60. Several commenters suggested that proposed sec.80.203(a)(1) be amended so that it does not require the executive director to prepare a draft permit if the executive director does not recommend the issuance of a permit. The commission disagrees, and declines to make this change, in part because the "freeze rules" were the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome, and in part because the failure to prepare a draft permit would present an almost insuperable barrier to an applicant should the applicant prevail on the issue of whether or not a permit should be issued. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.207(c) be amended to eliminate the additional time proposed beyond the first discovery period for filing a list of issues. The commission disagrees, and declines to make this change. An earlier version of this rule required protestants to have their issues list finished simultaneously with the end of the first discovery period, which the commission believes compresses the work that must be done. The commenter suggested that in the event the additional time remained, additional time should be added to proposed sec.80.207(e) as well. The commission disagrees and declines to make this change, since additional time is already granted by timing the applicant's response from the time the first list of issues is submitted, rather than the close of the first discovery period. Several commenters commented that proposed sec.80.207(d) allows an applicant to disrupt the work required of protestants to comply with subsection proposed sec.80.207(c), and suggested the deletion of the second sentence in subsection (d). The commission disagrees, and declines to make this change. The commenters apparently missed the time extension given in proposed sec.80.207(c), which now allows for completion of the issues list "within 20 days after the end" of the time period originally contained in old sec.265.104, from which the proposed section is derived. The result of the proposed sections is to give the protestant an additional 20 days to complete the issues list, while allowing the applicant to go forward with discovery. The result, rather than an additional burden on the protestant, is an easing of requirements. One commenter suggested that proposed sec.80.207(h) be amended to allow a limited amendment of the application in some circumstances. While the commission agrees that this commenter's point has some merit, the current arrangement was the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.209(c)(3) be amended to require the judge to distribute a prehearing order within four days from the prehearing conference. While the commission recognizes the commenter's concern and the limited (14-day) time period between the prehearing conference and the hearing, it prefers at this time to leave the timing of the prehearing order to the judge, trusting that prehearing orders will be distributed as soon as possible considering the compressed time frame. Two commenters suggested that proposed sec.80.213 be revised to make it clear that paragraph (1)(A) and (B) is not mutually exclusive and that the judge may direct a party to both voluntarily reduce its listed witnesses and provide a summary of the expected testimony of each witness. One commenter also suggested that the language of the rule be made more clear that the judge may prohibit testimony of witnesses. The commission agrees, and has amended the section accordingly. Several commenters suggested that proposed sec.80.259 be revised to eliminate a provision that would allow a judge to file an amended proposal for decision without serving it on the parties. This provision was included in a redline/strikeout version of the proposed rules distributed by agency staff during the rulemaking process, but was dropped from the proposed rule before publication, and thus no revision to the proposed rule is necessary. The staff regrets any inconvenience caused by failing to notify interested persons of the change before publication. The commission has amended proposed sec.80.263 to make it clear that the general counsel may set time limits for oral presentations before the commission. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.sec.80.265, 80.267, and 80.271 to remove the word "final" where it refers to commission decisions or orders, because the use of the word in these proposed sections may be unintentionally confusing when compared with the use of the word in Government Code, sec.sec.2001.141-2001.144, dealing with when decisions become final. One commenter suggested that the provision of proposed sec.80.267(b) that the commission will render a decision within 60 days after the date the hearing is finally closed does not give the commission enough time to render its decisions. The commenter suggested lengthening the time period to 90 days. The commission agrees that cases heard by a judge may take more than 60 days, but notes that the 60-day period is mandated by Texas Government Code, sec.2001. 143 unless extended. The commission believes, however, that proposed sec.80. 267(b) gives the judge enough flexibility to extend the time, and therefore declines to make the suggested revision. The commission has amended proposed sec.80.277 to more clearly reflect the commission's position and longstanding agency practice that the executive director or an authorized representative may forward an enforcement order to the attorney general for enforcement. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.86.18(c)(1)(C) to change the time period for filing applications for rehearing to 30 days to be consistent with Water Code, sec.11.316. One commenter suggested that the definition of "monitoring well" in proposed sec.340.2 be amended to expressly exclude monitoring wells used in conjunction with the production of coal and lignite, as is apparently intended by the general exclusion for wells used in conjunction with the production of "other minerals." The commission agrees, and has amended the section accordingly. One commenter noted that proposed sec.340.73 appears to differ from the requirements under discussion at the agency for sec.338.31 and sec.338.32 as to the persons to whom copies of well logs are to be submitted. The commission agrees, and has amended proposed sec.340.73 and sec.340.75 to add local underground water conservation districts and make these sections consistent. The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.3.2. Definitions. The following words and terms, when used in this part, shall have the following meanings, unless the context clearly indicates otherwise. APA-The Texas Administrative Procedure Act, Texas Government Code, Chapter 2001. Applicant-A person who submits an application to the commission. Agency-The commission, executive director, and their staffs. Application-A petition or written request to the commission for an order, permit, license, registration, standard exemption, or other approval. Chairman-The chairman of the commission. Chief clerk-The chief clerk of the commission or any authorized individual designated by the chief clerk to act in his or her place. Commission-The Texas Natural Resource Conservation Commission. In these rules, the term "commission" means the commissioners acting in their official capacity. Commissioner-A member of the commission. Contested case -A proceeding subject to the contested case requirements of the APA. Enforcement action -An action, initiated by the executive director, seeking an enforcement order. Enforcement order-Any commission order enforcing or directing compliance with any provisions; whether of statutes, rules, regulations, permits or licenses, or orders; which the commission is entitled by law to enforce or with which the commission is entitled by law to compel compliance. Executive director -The executive director of the commission, or any authorized individual designated to act for the executive director. General counsel -The general counsel of the commission, or any authorized individual designated by the general counsel to act in his or her place. Judge-A SOAH administrative law judge. Party-Each person named or admitted as a party in a contested case. Permit-Written permission from the commission, including a license or other authorization, to engage in a business or occupation, to perform an act (such as to build, install, modify, or operate a facility), or to engage in a transaction, which would be unlawful absent such permission. Person-An individual, corporation, organization, government or governmental subdivision or agency, business trust, partnership, association, or any other legal entity. Pleadings-Written allegations filed by parties concerning their respective claims, such as applications, protests, complaints, claims, petitions, executive director preliminary reports, answers, motions, and other similar documents, including those submitted by the executive director and the public interest counsel. Protestant-Any person opposing, in whole or in part, an application. Public interest counsel-The public interest counsel of the commission, or any authorized individual designated by the public interest counsel to act in his or her place. SOAH-The State Office of Administrative Hearings. TCAA-The Texas Clean Air Act, Texas Health and Safety Code, Chapter 382. Open Meetings Act-Texas Open Meetings Act, Texas Government Code, Chapter 551. Public Information Act-Texas Public Information Act, Texas Government Code, Chapter 552. TRCA-The Texas Radiation Control Act, Texas Health and Safety Code, Chapter 401. TSWDA-The Texas Solid Waste Disposal Act, Texas Health and Safety Code, Chapter 361. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606773 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 239-1966 Chapter 5. Advisory Committees 30 TAC sec.sec.5.1-5.14 The commission adopts new sec.sec.5.1-5.14, concerning procedural rules. Sections 5.2, 5.3, 5.8, 5.10-5.12, and 5.14 are adopted with changes to the proposed text as published in the February 20, 1996, issue of the Texas Register (21 TexReg 1354). Sections 5.1, 5.4-5.7, 5.9, and 5.13 are adopted without changes and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. Comments were received from Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts. Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts generally supported the adoption of the proposed sections with some changes. Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund, while apparently not opposing the adoption of the proposed sections as a whole, generally expressed concerns related to public participation and issues related to delegated federal programs. A number of commenters suggested minor editorial, typographical, and grammatical changes to clarify or shorten the proposed sections. The commission generally agrees with these suggestions, and has amended the proposed sections accordingly. These changes have been made to proposed sec.sec.1.1, 1.5, 1.7, 1.10, 1.11(a), 3.2, 5.3, 5.8, 5.10, 5.11, 5.12, 5.14, 10. 1, 10.2, 10.3, 10.6, 10.8, 20.17, 40.5, 40.6, 40.8, 40.9, 50.13, 50.17, 50.31, 55.21, 55.23, 55.25, 55.27, 55.29, 55.31, 70.2, 70.3, 70.4, 70.5, 70.6, 70.7, 70.8, 70.9(b), 70.10, 70.11, 70.101, 70.102, 70.104, 70.107, 70.108, 70.109, 80.3, 80.11, 80.17, 80.21, 80.23, 80.29, 80.31, 80.33, 80.109, 80.111, 80. 113(c), 80.115, 80.119, 80.127, 80.133, 80.155, 80.201, 80.205, 80.207, 80.209, 80.213, 80.251, 80.253, 80.257, 80.265, 80.267, 80.271, 86.1, 86.11, 86.15, 86.16, 86.34, 86.55, 86.96, 86.98, 86.99, 86.130, 86.131, 86.132, 340.41(b), 340.43(d), 340.45, 340.53(d), 340.71, 340.73, and 340.131. The titles of proposed sec.sec.10.9, 20.19, 40.5, 40.6, 40.8, 50.39(e), 55.31, 70.109, 80.5, 80.23(b), Chapter 50, Subchapter B and Chapter 86, Subchapter D have also been amended for clarity and to reflect their true content. Several commenters commented generally that the proposed sections limit public participation in permit and enforcement actions more stringently than allowed under federal law and do not meet the minimum requirements for federal program approval, basing this comment in part on a draft report prepared by one of the commenters. The commission disagrees. The commenters very narrowly construe the concept of public participation, and the commission does not agree that the statistics contained in the draft report are accurate. The commission does not agree that such a narrow emphasis on contested case evidentiary hearings at the expense of other methods of public participation is either fair or appropriate. The commission also does not agree that the proposed sections impose new limits on public participation. Although the commission's process will be continually reviewed and improved, the process and the proposed sections are consistent with the "United States Environmental Protection Agency's (EPA) Policy Statement of Public Participation," which contains no requirement for contested case hearings on every permitting matter. Public notice is given in compliance with statutory requirements, and when questions or comments from the public are received, the agency's technical staff responds to them. Agency permit engineers and attorneys spend a considerable amount of time answering questions from the public, meeting with them, educating citizens on both the scientific and legal requirements of permits. As questions are raised, staff reconfirms the review and position it is taking on permits. When there is considerable public interest expressed, the agency often will hold one or more public meetings in the local area to encourage give and take between the public, the applicant, and the staff. This is in addition to public meetings that may be required by statute (e.g., Texas Health and Safety Code, sec.361.0791, on hazardous waste management permits). Most importantly, the commenters overlook the provisions of the proposed sections which in fact dramatically increase the opportunity for public participation--now, every motion for reconsideration of an executive director's action goes directly to the commission, and every hearing request is placed on a commission meeting agenda with the right of the requestor to share information and concerns directly with the three commissioners. Most determinations on hearing requests, prior to September 1, 1995, were handled by the Office of Hearing Examiners with little, if any, involvement by the commissioners. The public now has the ability to submit information and concerns to the commissioners, very often has the ability to personally address the commissioners, and the commissioners have the ability to require the applicant and the executive director's staff to respond to those concerns. The exchange takes place in a posted, public hearing. This satisfies the "exchange of views and open exploration of issues, alternatives, and consequences" standard contained in the EPA Policy Statement. Although the commission believes that the proposed sections represent a dramatic improvement, the commission continues to explore ways to enhance this exchange of views. Several commenters suggested that the commission failed to provide notice of the procedural rule changes to the EPA as required. The commission disagrees. The commenters erroneously interpret 42 United States Code, sec.300h- 1(b)(1)(A)(ii) to require notice prior to final adoption of this rule package. Correctly read, the statute only requires notice of a rule change to the EPA after final adoption of an underground injection well program or changes to the program. Upon adoption of this package, the commission will provide appropriate notice to the EPA. One commenter suggested that proposed sec.1.1 be expanded to address both the purpose and scope of the commission's rules. The commission disagrees with this proposal because the language proposed would state what is already law, that the rights of parties and the commission's powers are established by statute and cannot be enlarged by rule, and that the statutes prevail if the commission's rules are in conflict with them. Several commenters criticized the commission's handling of confidential documents under current rules being revised and adopted as proposed sec.1.5. The commission disagrees with these comments because the commission's management of confidential documents complies with all applicable requirements. Another commenter proposed additional language for this section which would specify the duties of the agency's central records office. The commission disagrees, because the proposed directives concerning internal office procedure can be made without adopting the directives as a rule. The commission notes that it has recently directed its executive director to evaluate the agency's record management practices. This evaluation is already under way, and will include the agency's handling of confidential documents to ensure they are not inadvertently disclosed to the public. A request for proposal has been published for a study on the matter. One commenter suggested that proposed sec.1.11 be amended to make it clear what is included in the phrase "courier-receipted delivery service." The commission believes that the phrase is sufficiently clear, and declines to add any definition beyond that already provided in Texas Rule of Civil Procedure 21a. The commission believes that the modifications to proposed sec.1.11 described as follows may also resolve the commenter's concerns. One commenter noted that proposed sec.1.11 and sec.10.10 appear to be missing subsection (e), which appears in old sec.261.18, from which they are derived. The commission agrees. This deletion was inadvertent, since proposed sec.1.11 and sec.10.10 were intended to include the provisions of old sec.261.18. Proposed sec.10.10 duplicates proposed sec.1.11 and has been deleted, and subsection (e) has been added to proposed sec.1.11. In addition, the commission has further clarified proposed sec.1.11 by more closely tracking Texas Rule of Civil Procedure 21a, which the commission believes covers the same subject matter more completely, and has amended and renumbered subsections accordingly. One commenter suggested that proposed sec.3.2 be revised to incorporate several definitions currently contained in other chapters. The commission agrees in part, and has added definitions of "enforcement action" and "enforcement order" to proposed sec.3.2. Other definitions not moved are used only in single chapters, and the commission believes it more useful to leave those definitions in the chapter to which they apply, rather than move them to a general definitions section. The commission intends, however, to continue to consolidate widely used definitions in Chapter 3 for clarity and consistency. One commenter suggested that the definition of "advisory committee" in proposed sec.5.2 be condensed. The commission agrees, and has amended the proposed section accordingly. This commenter also suggested that this definition be moved from proposed sec.5.2 to proposed sec.3.2. Since this term seems to be used only in proposed Chapter 5, the commission disagrees and has left the definition in proposed sec.5.2. One commenter suggested that proposed sec.10.7 be amended to clarify that the commission will keep a certified agenda of closed meetings held in accordance with the requirements of the Texas Open Meetings Act. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.10.9 and sec.10.10 duplicate proposed sec.1.10 and sec.1.11, and suggested that the proposed sections appear only in proposed Chapter 1. The commission agrees, and has deleted proposed sec.10.10 and amended proposed sec.10.9 to change its title and refer to proposed sec.1.10 and sec.1.11. One commenter suggested that proposed Chapter 40 be amended to allow participation in Alternative Dispute Resolution (ADR) by "interested parties" and to allow mediation to occur before a request for hearing is made. While the commission wholeheartedly supports ADR efforts, it disagrees for two reasons, and declines to make the change. First, participation in ADR in contested cases must necessarily be limited to the parties to the case, or at the hearing request stage, to those filing hearing requests as well. Without this limitation, the commission believes it will be difficult for participants to commit to a process where the number and identity of negotiating parties is subject to change. Second, while the commission is strongly committed to ADR, and encourages its use at all stages of the application process, it believes that it is wiser to continue to encourage informal ADR outside of agency rules prior to entry into the contested case process, and leave its use up to the participants, rather than attempt to promulgate rules governing its use at this time. One commenter suggested that the definition of the term "alternative dispute resolution office" in proposed sec.40.2 be replaced with a definition of the term "alternative dispute resolution director" because the latter is used throughout proposed Chapter 40. The commission agrees, has amended the proposed section accordingly, and has also amended proposed sec.40.5(a)(1) accordingly. One commenter suggested deleting the words "regardless of which ADR method is used" from the definition of "mediator" in proposed sec.40.2, as not adding to the definition. The commission disagrees, because it believes that the term "mediator" is used in some circles as a term of art to refer only to a person engaged in specific dispute resolution procedures, and the term is used in these proposed sections in a more inclusive manner. One commenter suggested using the word "applicant" rather than a longer term in the definition of "participant" in proposed sec.40.2, and adding "named parties" to the definition to make clear that they are included in the definition. The commission agrees, and has amended the proposed section accordingly. One commenter suggested deleting the words "from the pool of mediators" from the first sentence of proposed sec.40.4(a) and adding clarifying language regarding private mediators, to make the proposed section more consistent with the other proposed sections of the chapter. The commission agrees, and has amended the proposed section accordingly. One commenter suggested rewording proposed sec.40.4(c) for brevity and clarity. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.40.6 could be read to exclude the possibility of a matter being referred to ADR after a draft permit is proposed and a protest letter received, but prior to the matter being referred to the State Office of Administrative Hearings (SOAH), as proposed sec.55.25(d)(1) anticipates, and suggested amending the proposed section. The commission agrees with the commenter that this can be the most productive period for ADR, expressly desires to encourage ADR at this point, and has amended the proposed section to make it clear that cases may be referred to ADR at this point and that ADR outside of the commission process may be used at any time. Several commenters commented that proposed sec.50.13 and sec.50.33 allow the commission and its executive director to act on an application without considering any comments, and generally maintain that the proposed sections of procedural rules as a whole preclude public comment. The commenters also claim that the provisions of proposed sec.50.33 which prevent action by the executive director where there is a "protest" and the provision for motions for reconsideration are not an adequate substitute for a public comment process. The commission disagrees, and declines to amend the proposed sections. Proposed sec.50.13 and sec.50.33 allow action without a contested case hearing, which is not equivalent to action without considering comments. The procedures contained in the proposed procedural rules sections are, for the most part, in addition to the commission's public comment process, rather than a substitute for them, as the commenters apparently assume, and the equation of participation in a contested case hearing with public comment is inappropriate. The commission actively encourages public participation, and has gone on record repeatedly to express this and to broaden public participation, but believes that the amendments suggested by the commenters go far beyond the scope of this rulemaking. One commenter suggested that proposed sec.50.39 be amended to allow only an "affected person" to file a motion for reconsideration of an executive director's action on an application, suggesting that the term "other person" is too broad. The commission disagrees, and declines to change the proposed section, because the proposed language gives the commission flexibility to reconsider decisions in situations where the error complained of merits attention regardless of who raises it. Additionally, allowing any person to file a motion for reconsideration allows another avenue for public comment by bringing concerns directly to the attention of the commission. The commission believes, however, that the question of whether a person filing a motion for reconsideration is an affected person will in some cases have a bearing on whether the commission acts on the motion. Several commenters criticized proposed sec.55.21(b) and (d), claiming that because of multiple publications, it may be difficult to tell when the deadline for a hearing request occurs. While much of the timing and many of the contents of notices are specifically required by statute, to the extent that this becomes a problem, the commission plans to deal with it in rulemaking on a new proposed chapter governing public notice, rather than in this rulemaking. Several commenters suggested that proposed sec.55.21(c) constitutes an unlawful delegation and allows the person who designs a notice to decide what will be required in a hearing request. The commenters further assert that the proposed section does not adequately plan for errors in the published notice. The commission disagrees, and declines to change the proposed section. The statutes and other sections of the commission's rules dictate the content of public notices, and this proposed section merely requires hearing requests to comply with those requirements, if any. If the notice is defective, this must be generally cured through republication, thus giving another chance to comply with any requirements. Several commenters criticized proposed sec.55.21(e) for not establishing procedures for requesting extensions of time and suggested the inclusion of a "good cause" or public interest test. The commission disagrees. This section is primarily intended to allow the commission to consider late hearing requests. The commission believes that the proposed section allows more flexibility for the commission and the public than the suggestion does, and declines to change the section. One commenter suggested that proposed sec.55.23(b) be revised to require a group or association to provide an explanation of its hearing request with sworn affidavits, written resolutions, or other satisfactory documentation, rather than to allow other parties to request such an explanation. The commission disagrees. While the proposed sections anticipate that a group or association will submit such information, requiring this as an absolute requirement in advance when the group or association's qualifications are not in dispute is burdensome and unnecessary. However, allowing the listed parties to request that evidence, if they believe it to be an issue, protects the integrity of the hearing process and the rights of the applicant while limiting evidence and testimony to those issues that are actually in dispute. Several commenters suggested that proposed sec.55.23(b) and sec.55.26(f) place unreasonable burdens on the public in replying to responses to hearing requests. There is no proposed sec.55.26 and the latter reference is apparently to proposed sec.55.25(f). The commission disagrees, because these proposed sections merely provide a way for the commission and other parties to determine the basis of a hearing request, which is clearly relevant under Texas Water Code, sec.5.115. While the commission does not agree that the proposed time periods are unreasonable, it has determined that the time for replying to responses to hearing requests in proposed sec.55.25(f) should be lengthened from ten days to 14 days to give requestors more time to prepare, and has amended proposed sec.55.25 accordingly. Several commenters suggested that the commission amend proposed sec.sec.55.25, 55.27, 55.29, and 55.31, to change the way the commission deals with hearing requests and with determinations of whether a person is an "affected person," whether a request is "reasonable," and what constitutes "competent evidence" under Texas Water Code, sec.5.115. The commission agrees that these items may need further attention, but, as announced at the beginning of this phase of rulemaking and stated in the preamble to these proposed rules, has reserved this issue for further rulemaking, once sufficient experience has been accumulated with the existing process to fairly evaluate how well the existing rules are working. This project is already underway at the agency, and the commission expects that it will get into full swing shortly after this rulemaking project is concluded. While some minor adjustments to the current process are included in this round of rulemaking, the commission declines to make the suggested major changes in this round of rulemaking. Several commenters suggested that the proposed sections place an unreasonable burden on who can qualify for a hearing and claimed that the commission has not implemented its authority to provide for public participation in hearings. The commission disagrees. As noted previously, the commission believes that the proposed sections broadly encourage public participation. In addition, the proposed sections are entirely consistent with the law on hearings and standing. Finally, the commission is already committed to reviewing this process in another round of rulemaking. Several commenters suggested that proposed sec.55.25(g) be revised to allow a legislator (for an activity in the legislator's district), a state agency, a federal agency, or a local government (for a facility within the local government's jurisdiction) to send an application directly to SOAH for a contested case hearing. The commission disagrees. Nothing in the statutes grants such blanket rights, and the commission believes that adding this provision would violate both the letter and intent of Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115, as well as other specific statutes dealing with contested case hearings, and therefore declines to make this change. One commenter noted that the provisions of proposed sec.55.27 and sec.55.29 do not appear to address instances where the definition of affected persons in the rule (and in Texas Water Code, sec.5.115) may differ from specific statutory provisions defining "affected person" or "person affected," and suggested that the proposed sections be revised to make it clear that specific statutory provisions control. In the alternative, the commenter suggested that the commission apply both the definition of "affected person" in the proposed sections and any specific statutory definition. The commission agrees with the commenter that Texas Water Code, sec.5.115, the proposed sections, and other specific statutes can and should be read together. Generally, Texas Water Code, sec.5.115 will require a "personal justiciable interest," while other specific statutory provisions delineate those interests, specifying distance limitations or identifying specific persons who can request a hearing. The commission believes that the provisions of proposed sec.55.27 (that a hearing request be granted if it is "pursuant to a right to hearing authorized by law") and proposed sec.55.29 (that a relevant factor in determining whether a person has "a personal justiciable interest related to a legal right, duty, privilege, power, or economic interest affected by the application" is "whether the interest claimed is one protected by the law under which the application will be considered") require Texas Water Code, sec.5.115 and any applicable specific statute to be read together. Thus, the commission declines to modify the proposed sections. Several commenters suggested that proposed sec.55.27(b) and (c) be amended on the grounds that they conflict with statutory provisions such as Texas Water Code, Chapter 27, in which counties are granted hearings regardless of a showing of standing or reasonableness of their hearing requests. The commenters also suggested that the test for a state agency or local government needs to be clarified, alleging, for example, that a county is automatically an affected person for an activity in that county. The commission disagrees. No statute, other than those giving party status to the executive director, public interest counsel, Texas Water Development Board, and Texas Parks and Wildlife Department, provides as a blanket rule that a governmental entity is automatically an affected person for all activities in a geographic area, although some do in specific instances. Texas Water Code, sec.27.018, for instance, provides for a hearing on an injection well permit application if one is requested by a "local government." The statute further distinguishes between the terms "local government" and "affected person"--a distinction that does not appear in Texas Water Code, sec.5.115. While there may be some confusion over the use of the term "affected person" in more than one context, the commission believes that it is clear that a hearing request by a local government under Texas Water Code, sec.27.018 meets the tests of reasonableness and being "pursuant to a right to hearing authorized by law" under proposed sec.55.27(b) and "in the public interest" under proposed sec.55.27(c), and that a governmental entity may be an affected person given the definition of "person" contained in proposed sec.3.2 and its "authority under state law" in proposed sec.55.29(b). The commission further believes that the tests for a state agency or local government are sufficiently clear, and therefore declines to amend the proposed sections. Two commenters suggested that the provisions of proposed sec.55.27(c), which allow the commission to refer an application to SOAH for hearing if the commission determines that a hearing would be "in the public interest" even if there is no valid hearing request, be deleted or that the commission delineate standards it will use in making this determination. Several commenters suggested that the provision is vague in that it does not define "public interest." The commission disagrees with these comments and declines to make the suggested changes, in that it believes that there may be situations where the public interest demands a hearing (one example might be information received after the deadline for hearing requests), and also believes that it would be impossible to define "public interest" at this time in terms more specific than those used by the statutes under which the commission operates. One commenter suggested that proposed sec.55.27(c) be deleted as duplicative of proposed sec.55.27(b)(1). The commission disagrees and declines to make the proposed change. Proposed sec.55.27(b)(1) allows a commissioner, an applicant, or the executive director to request a contested case hearing and thereby refer a case to SOAH, while proposed sec.55.27(c) allows the commission as a whole to vote to send a case to SOAH. The two provisions serve different purposes and the commission believes they should be kept separate. Several commenters suggested that the commission's rules on notice need significant changes, and suggested that proposed sec.55.27(c) be amended to prohibit the final notice on a permit from being issued before technical review is complete and a draft decision is available. The commission does not agree that these proposed sections are the place to deal with notice requirements, notes that no notice has been given to the public or interested parties that notice requirements would be changed in these proposed sections, and points out that it is in the process of preparing for publication a new chapter to consolidate many of its notice rules. However, the commission disagrees with the commenters that the existing rules regarding notice are inadequate or restrict public participation. Proposed sec.55.27(c) does not deal with notice, but rather allows the commission to refer an application to SOAH even if there is no hearing request, and the commission does not agree that amending it to deal with notice would be appropriate or advisable. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear whether an administrative law judge can overrule a commission denial of a hearing request based on standing. The commission has amended proposed sec.55.27(f) to make its position on this issue more clear--that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear what must be done to appeal the denial of a hearing request, do not make it clear when the time period for appeal begins to run, and add new burdens by requiring two appeals. The commission does not agree, and declines to further amend the proposed sections beyond the amendments already described. The proposed sections make it clear that a party whose hearing request is denied must seek to obtain party status and then, if unsuccessful, follow procedures for a motion for rehearing as a prerequisite to appeal once the commission has disposed of the application. Since a person who files a hearing request is asking that a contested case hearing be held, that party obtains the relief sought if any hearing request is granted. That person must then seek to be admitted as a party if the person wishes to participate in the case, and decisions on that issue will be handled as they are now, although the commission anticipates that if the person has a complaint at this point, it will be the denial of party status or a limitation of issues rather than a determination on a hearing request. If all hearing requests are denied or withdrawn, persons whose requests are denied have an opportunity for the review of that decision by filing a motion for rehearing after the commission's decision on the application--that is, at the end of the case, rather than in an interlocutory appeal, as the commenters seem to suggest. The commission believes that it is clear in the proposed sections that the time period for appeals begins to run at this point. While the commenters also suggest that it is unreasonable to force parties to go through a hearing and have the result of that hearing reversed by a court based on an error in denying party status, the commission believes that the risk of this kind of result is minimal, is inherent in every determination of party status in any kind of proceeding, and is outweighed by the burden to the public that would be imposed by delaying every permitting decision until determinations of party status are appealed through the court system. Two commenters noted that proposed sec.55.27(f) allows a person whose hearing request is denied to still seek to be admitted as a party, and suggested that absent some compelling reasons, the commission's determination on the hearing request should preclude the later admission of the person as a party. The commission disagrees, and has amended the proposed section as noted previously to make it clear that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. One commenter suggested that proposed sec.55.27 be amended to allow a motion for reconsideration, rather than a motion for rehearing, of the denial of a hearing request, suggesting that the latter is only appropriate in contested cases under the Administrative Procedure Act, and that no contested case arises if a hearing request is not granted. The commission disagrees. As stated previously, the commission believes that a decision on the validity of a hearing request is an interlocutory decision only on the validity of the request, and does not necessarily dictate the outcome of a later decision on party status, or standing. The commission believes that a motion for rehearing at the conclusion of the proceedings is the most appropriate way to review such a decision. Several commenters remarked that the proposed sections do not allow for an adequate record for judicial review when no contested case hearing is held and do not establish standards for a court to use in its review. The commenters also suggest that the proposed sections do not create an adequate record in rulemaking. The commission disagrees, and declines to make changes based on this comment, because it believes that the record created is sufficient for judicial review of the commission's actions, and the standards of review are already clearly established in the statutes and rules. Similarly, the commission believes that the record created in rulemaking proceedings is more than adequate. Several commenters suggested that proposed sec.55.29 and sec.55.31 be revised to provide that the commission accept as true written statements of a person filing a hearing request for the purposes of the determination on the request or the person requesting a hearing be given an opportunity to present evidence to meet the burden of presenting competent evidence under Texas Water Code, sec.5.115. The commission disagrees and declines to make these changes. The first alternative ignores the clear intent of Texas Water Code, sec.5.115, by allowing a person to meet its standards by simply claiming that the standards are met. Texas Water Code, sec.5.115 provides that the commission "is not required to hold a hearing if the commission determines that the basis of the person's hearing request is unreasonable or is not supported by competent evidence." The second alternative does not recognize that this determination will require different procedures in different cases, and the flexibility which the proposed sections provide--from a decision on the pleadings to oral argument to an evidentiary hearing--allows for procedures to be followed which are appropriate for the cases presented. For example, a permit renewal under Texas Health and Safety Code, sec.382.056 may be an example of a case where requests not alleging increases in emissions or compliance problems can be dealt with on the pleadings alone. Similarly, a person who cannot allege a reasonable basis for a hearing request or who cannot allege that competent evidence exists to support the request, despite having more than one opportunity to do so (the request itself, a reply filed under proposed sec.55. 25(f) to responses that point out the merits or deficiencies of the request, and, in appropriate cases, argument or testimony before the commission) is not going to be able to present such evidence at a hearing, and it may be appropriate to resolve this request without an evidentiary hearing. Several commenters suggested that proposed sec.55.31 is unconstitutionally vague and conflicts with other Texas Natural Resource Conservation Commission rules and the law, specifically proposed sec.55.29 and Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115 and that the provisions of proposed sec.55.31(b)(3) are overly burdensome on public participation. The commission disagrees. The commission believes that the proposed section fully complies with the constitution and with Texas Health and Safety Code, sec.382. 056 and Texas Water Code, sec.5.115. The term "reasonableness" is adequately defined by proposed sec.55.31. Further, proposed sec.55.31 does not conflict with proposed sec.55.29, because they deal with different matters--the first with the determination of whether a person is an "affected person," and the second with whether a hearing request is "reasonable." Several commenters suggested that the proposed rules be revised to "provide that the commission will make determinations and record those determinations so that the public can understand the basis for its government's decision and so that a reviewing court can determine if the actions of the commission should be affirmed or reversed." As noted previously, the commission believes that the proposed sections do exactly that and declines to make changes based on this comment. Several commenters suggested that proposed sec.55.33(a)(3) (and presumably proposed sec.80.5(a)(3)) be revised, claiming that the proposed section requires the Chief Clerk to pay the cost for issuing public notices. The commission disagrees, since the proposed section requires the clerk to issue notice and does not provide for the Clerk to pay the cost of notice, since applicants are clearly responsible for those costs. Proposed sec.55.33 has been withdrawn, however, and only proposed sec.80.5 now governs the Chief Clerk's actions in this context. Several commenters noted that the setting procedures of proposed sec.55.33 largely duplicate those of proposed sec.80.5, and suggested the deletion of one or the other. Some commenters suggested conforming these two proposed sections. The commission agrees that these sections are duplicative and should be conformed, and notes as well that proposed sec.70.109 largely duplicates both of these sections. For clarity, the commission believes that it is most logical to lay out all setting procedures only in proposed Chapter 80, and has deleted proposed sec.55.33 and amended proposed sec.70.109 accordingly. Several commenters suggested that the proposed sections of proposed Chapter 70 limit public participation in enforcement proceedings in a fashion that does not meet the federal requirements for such participation and further state that notice in the Texas Register is insufficient. The commission disagrees, and declines to change the proposed sections. The agency complies with federal authorization rules regarding public participation in enforcement matters, which require the agency to have procedures in place for responding to citizen complaints, publish notice of settlements of civil actions, and give assurance that it will not oppose intervention by any citizen when permissive intervention is authorized by statute, rule, or regulation. In regard to the comment that Texas Register publication is insufficient, while the commission disagrees, it is currently considering alternative citizen participation in administrative actions. If rule changes are necessary after a decision is made on this issue, they will be taken up separate from this rulemaking. One commenter suggested that the definitions of "enforcement order," "enforcement action," "petition," and "respondent" be moved from proposed sec.70.2 to proposed sec.3.2. The commission agrees that the definitions of "enforcement action" and "enforcement order" should be moved to sec.3.2 since they are used in general context in other chapters of the agency's rules; however, the terms "petition" and "respondent," as they are defined in proposed Chapter 70, are specific to enforcement actions by the commission only and should remain in proposed Chapter 70. The commission does not believe that generic definitions of petition and respondent are necessary in proposed Chapter 3 to cover permitting matters because those terms are generally accepted legal terminology and "petition" is already included in the definition of "application." One commenter suggested that proposed sec.70.51 substantially changes old sec.337.71 from relating only to water rights enforcement matters to a more general mandatory enforcement hearing process. The commission disagrees. The language in proposed sec.70.51 was taken verbatim from old sec.337.71, except that the title of the subchapter was changed and references to other rules which had been renumbered were changed. The definitions included in old sec.337. 71 included water quality, water rights, hazardous waste releases, and references to the air statute as well. Although the title of old sec.337.71 indicated "Water Rights Enforcement," its statutory basis is Texas Water Code, sec.5.117, which applies to the agency as a whole, and requires the executive director to bring all instances of substantial noncompliance before the commission. The commenter expressed concern that proposed sec.70.51 would require mandatory hearings for incorrect compliance with record keeping requirements in an air permit. Since this would normally not be a substantial noncompliance under the air rules, this section would not apply in that case. Furthermore, old sec.337.71 and proposed sec.70.51 both exclude air violations, since a separate statutory requirement exists for the air program. The program most affected by this statutory requirement is the water quality program, which has a large amount of self-reporting data submitted each month. The proposed section basically sets forth the practice of the watershed management and enforcement divisions in processing this large volume of documents and describes how they determine what constitutes a substantial noncompliance. One commenter suggested that the concept of "executive director preliminary reports" (EDPR), used in proposed sec.70.101, is not necessary in proposed Chapter 70 and is not mandated by statute. While EDPRs are not required by statute, they are clearly allowed and anticipated by statute (see Texas Water Code, sec.sec.13.4151(c) and (d), 26.136(d) and (e), 27.1015(d) and (e), 34. 011(d) and (e) and Texas Health and Safety Code, sec.sec.341.049(c) and (d), 361. 252(d) and (e), 366.0924(d) and (e), 382.088(d) and (f), and 401.384- 401.385). This rulemaking does not alter the provisions in old Chapter 337 regarding preliminary reports, and sets forth the agency's procedures if preliminary reports are chosen as the form of pleading in a case. The executive director is not required to issue a preliminary report, but is given an option which may be used on a case-by-case basis, which is consistent with the statutory provisions. The commission disagrees with the comment and declines to change the proposed section. The commission has determined that the setting procedures of proposed sec.70. 109 largely duplicate those of proposed sec.80.5, and has amended them to simply refer to proposed sec.80.5. The commission has also amended the title of this section for clarity. One commenter suggested that proposed sec.80.3(a) be amended to make it clear that the judge sitting in a phase of a hearing, not the presiding judge, will resolve evidentiary questions raised during that phase of a hearing. The commission generally agrees, but believes that it may be necessary for a judge sitting in one phase of a hearing to refer some important evidentiary questions to the presiding judge, and has amended the section accordingly. Two commenters suggested that proposed sec.80.3(b)(10) be revised to make it clear that the judge may limit the time of presentation of evidence and witnesses without unfairly prejudicing the rights of parties. The commission agrees, and has amended the rule accordingly. In addition, the commission believes that splitting proposed sec.80.3(a) into two subsections and redesignating proposed sec.80.3(b) as sec.80.3(c) makes the proposed rule more readable, and has amended it accordingly. Two commenters suggested that proposed sec.80.5(b) be amended to expressly state that the commission may limit the issues that shall be considered by SOAH in a contested case. The commission agrees that this ability is implicit in Texas Government Code, sec.2003.047(e), and has amended the proposed section accordingly. These commenters also suggest that the proposed section be amended to provide that the commission "may," rather than "shall," identify issues to be addressed. Since Texas Government Code, sec.2003.047(e) uses "shall," the commission disagrees and declines to make this change. The commission has amended proposed sec.80.5(b) to make it clear that the executive director's petition or EDPR serves as the list of issues to be addressed by SOAH in a contested enforcement case. One commenter suggested that proposed sec.55.33(b) (the same as proposed sec.80.5(b)) be deleted, stating that while the commission may want to restrict or direct the list of issues, the proposed section suggests that a referral is not adequate if it does not. The commission disagrees, since Texas Government Code, sec.2003.047(e) clearly mandates an issues list, and since the proposed section gives the commission the flexibility to submit both broad and narrow ranges of issues. Several commenters suggested that proposed sec.80.13 be amended to allow parties, as well as the executive director, to request consolidation of related proceedings. The commission disagrees and declines to change the proposed section, because this is already allowed by the proposed sections. Proposed sec.80.13 allows the executive director to consolidate matters with the permission of the judge, and allows the judge to consolidate matters, presumably on the judge's own motion or that of any party. One commenter noted that due to changes in Chapter 291 of the commission's rules, proposed sec.80.17 does not accurately reflect the burden of proof in certain water and sewer rate cases. The commenter also noted that enforcement cases covered by subsection (c) of the rule should be expressly excepted from subsection (a). The commission agrees, and has amended the proposed section accordingly. One commenter suggested that proposed sec.80.27 be deleted as duplicative of proposed sec.sec.1.08, 1.10, 1.11, and 80.31. While the proposed sections cover similar matters, the commission disagrees and declines to make the change, because proposed sec.80.27 covers mostly matters of form, while the other proposed sections deal with more procedural matters. The commission has amended proposed sec.80.101 to make it clear that the executive director may either act on a matter remanded to the executive director or set it for consideration at a commission meeting. This is allowed by the proposed section, but the amendment lends clarity. One commenter suggested that proposed sec.80.107 is of sufficient importance that it should be dealt with as a separate subchapter. While the commission agrees that the proposed section is important, it prefers as a matter of form at this time not to create additional subchapters, and declines to make the change. One commenter suggested deleting the phrase "administrative law" from a reference in proposed sec.80.107(a)(3) to result in consistent references to the presiding officer as "judge." The commission agrees, and has amended the proposed section accordingly. One commenter suggested amending proposed sec.80.109(b) to define only statutory parties. The commission disagrees, and believes that the proposed section serves a more useful function by referring to all parties to an application, rather than just statutory parties, and declines to make this change. One commenter suggested deleting proposed sec.80.109(c) as duplicative of proposed sec.80.115. The commission agrees, and has amended the proposed section accordingly, renumbering the subsequent subsections. One commenter suggested deleting proposed sec.80.109(d) (now sec.80.109(c)) as duplicative of proposed sec.80.3(b)(5). The commission disagrees, since the section as amended in response to comments on proposed sec.80.115 now makes it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. One commenter suggested moving proposed sec.80.109(e) ((now sec.80.109(d)) to proposed sec.80.119, arguing that it makes more sense to discuss the effects of continuance in that section. The commission disagrees and declines to make the change. Proposed sec.80.109(e) (now sec.80.109(d)) is intended to make it clear that a person designated as a party retains party status regardless of any postponement of a hearing. Since the rule is limited to party status, the commission feels that it makes more sense to leave it in its present location. Several commenters commented that proposed sec.80.111 prohibits the judge and commission from considering comments. The commission disagrees, and points out that the section does not at all impair the executive director's ability to consider comments. The proposed section prohibits the judge from considering protests or comments submitted by non-parties in a non-evidentiary context (not under oath and without the opportunity to cross-examine) as evidence in contested case proceedings. The commission believes this is required by law, and declines to change the proposed section. The commission notes, however, that the phrase "[i]n proceedings other than enforcement proceedings" was inadvertently published as the end of the second sentence of this section, rather than as the beginning of the third sentence. The commission has amended the section accordingly, so that this limitation applies to questions submitted to the judge, not to the consideration of comments. One commenter noted that proposed sec.80.115 is not clear as to whether each and every party has a right to conduct discovery, present a direct case, cross- examine witnesses, obtain copies of pleadings, and so on, even when parties have been aligned under proposed sec.80.109. The commission agrees that the two provisions could be confusing when read together, and has amended proposed sec.80.109(d) to make it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. The commission anticipates that judges will exercise their best judgment when aligning parties and specifying the purposes for which they are aligned. One commenter suggested that proposed sec.80.117(b) be revised to make it clear that all persons granted party status are covered in the order of presentation. The commission agrees, and has amended proposed sec.80.117 by substituting the words "other parties" for the word "protestant." One commenter suggested deleting the word "SOAH" from proposed sec.80.119(d) to make it clear that the section does not restrict the judge in a contested case proceeding to the use solely of SOAH mediators. The commission agrees, and has amended the proposed subsection accordingly. The subsection has also been combined with proposed sec.80.119(c), to make the section shorter and more clear. One commenter suggested combining proposed sec.80.127(a)(2) and (c) to eliminate duplication. The commission agrees, and has amended the proposed section and renumbered subsections accordingly. One commenter suggested that proposed sec.80.127 be revised to more closely track the provisions of Texas Rule of Civil Procedure 267 and Texas Rule of Evidence 613, which prohibit the exclusion from the hearing room when "the rule" is invoked of an officer or employee of a party that is not a natural person and who is designated as its representative by its attorney and a person whose presence is shown by a party to be essential to the presentation of its case. The commission agrees, and has added subsection (f) to the proposed section so that it will more closely track the practice in the courts. One commenter suggested amending proposed sec.80.133 to allow the judge to set a schedule for the submission of written briefs. The commission agrees, and has amended the proposed section accordingly. Two commenters suggested that proposed sec.80.137 be amended to incorporate by reference Texas Rule of Civil Procedure 166a, because of the substantial body of interpretive case law and legal commentary available. The commission agrees that Rule 166a contains valuable guidance, and has tried to track the language of the rule in the proposed section as far as it considers appropriate given the difference between the administrative and judicial processes and the commission's assumption that the most likely use of the proposed section will be to limit issues, rather than to dispose of applications. The commission has accordingly modified the proposed section to track Rule 166a more closely, and anticipates that practitioners and judges will look to Rule 166a and the decisions construing it for guidance. Two commenters suggested that proposed sec.80.137 be amended to change some language relating to testimonial evidence. Because of the amendments noted previously, the commission believes the issue raised by this language to be resolved and declines to make further changes. One commenter suggested that proposed sec.80.151 be amended to expressly refer to Texas Rule of Civil Procedure 215. The commission disagrees, and declines to change the proposed section, because it believes that the grant of authority in Texas Government Code, sec.2003.047 and the sanctions provisions of proposed sec.80.107 already make sufficient provision for sanctions for discovery abuse. One commenter suggested that proposed Subchapter E of Chapter 80 (the "Freeze Rules") be deleted. While the commission recognizes the commenter's concern, it feels that the "freeze rules" have not yet been given a real test in practice, and is inclined to amend, rather than repeal them. The commission has corrected an incorrect reference in proposed sec.80.205 to refer to sec.80.105, rather than sec.80.60. Several commenters suggested that proposed sec.80.203(a)(1) be amended so that it does not require the executive director to prepare a draft permit if the executive director does not recommend the issuance of a permit. The commission disagrees, and declines to make this change, in part because the "freeze rules" were the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome, and in part because the failure to prepare a draft permit would present an almost insuperable barrier to an applicant should the applicant prevail on the issue of whether or not a permit should be issued. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.207(c) be amended to eliminate the additional time proposed beyond the first discovery period for filing a list of issues. The commission disagrees, and declines to make this change. An earlier version of this rule required protestants to have their issues list finished simultaneously with the end of the first discovery period, which the commission believes compresses the work that must be done. The commenter suggested that in the event the additional time remained, additional time should be added to proposed sec.80.207(e) as well. The commission disagrees and declines to make this change, since additional time is already granted by timing the applicant's response from the time the first list of issues is submitted, rather than the close of the first discovery period. Several commenters commented that proposed sec.80.207(d) allows an applicant to disrupt the work required of protestants to comply with subsection proposed sec.80.207(c), and suggested the deletion of the second sentence in subsection (d). The commission disagrees, and declines to make this change. The commenters apparently missed the time extension given in proposed sec.80.207(c), which now allows for completion of the issues list "within 20 days after the end" of the time period originally contained in old sec.265.104, from which the proposed section is derived. The result of the proposed sections is to give the protestant an additional 20 days to complete the issues list, while allowing the applicant to go forward with discovery. The result, rather than an additional burden on the protestant, is an easing of requirements. One commenter suggested that proposed sec.80.207(h) be amended to allow a limited amendment of the application in some circumstances. While the commission agrees that this commenter's point has some merit, the current arrangement was the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.209(c)(3) be amended to require the judge to distribute a prehearing order within four days from the prehearing conference. While the commission recognizes the commenter's concern and the limited (14-day) time period between the prehearing conference and the hearing, it prefers at this time to leave the timing of the prehearing order to the judge, trusting that prehearing orders will be distributed as soon as possible considering the compressed time frame. Two commenters suggested that proposed sec.80.213 be revised to make it clear that paragraph (1)(A) and (B) is not mutually exclusive and that the judge may direct a party to both voluntarily reduce its listed witnesses and provide a summary of the expected testimony of each witness. One commenter also suggested that the language of the rule be made more clear that the judge may prohibit testimony of witnesses. The commission agrees, and has amended the section accordingly. Several commenters suggested that proposed sec.80.259 be revised to eliminate a provision that would allow a judge to file an amended proposal for decision without serving it on the parties. This provision was included in a redline/strikeout version of the proposed rules distributed by agency staff during the rulemaking process, but was dropped from the proposed rule before publication, and thus no revision to the proposed rule is necessary. The staff regrets any inconvenience caused by failing to notify interested persons of the change before publication. The commission has amended proposed sec.80.263 to make it clear that the general counsel may set time limits for oral presentations before the commission. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.sec.80.265, 80.267, and 80.271 to remove the word "final" where it refers to commission decisions or orders, because the use of the word in these proposed sections may be unintentionally confusing when compared with the use of the word in Government Code, sec.sec.2001.141-2001.144, dealing with when decisions become final. One commenter suggested that the provision of proposed sec.80.267(b) that the commission will render a decision within 60 days after the date the hearing is finally closed does not give the commission enough time to render its decisions. The commenter suggested lengthening the time period to 90 days. The commission agrees that cases heard by a judge may take more than 60 days, but notes that the 60-day period is mandated by Texas Government Code, sec.2001. 143 unless extended. The commission believes, however, that proposed sec.80. 267(b) gives the judge enough flexibility to extend the time, and therefore declines to make the suggested revision. The commission has amended proposed sec.80.277 to more clearly reflect the commission's position and longstanding agency practice that the executive director or an authorized representative may forward an enforcement order to the attorney general for enforcement. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.86.18(c)(1)(C) to change the time period for filing applications for rehearing to 30 days to be consistent with Water Code, sec.11.316. One commenter suggested that the definition of "monitoring well" in proposed sec.340.2 be amended to expressly exclude monitoring wells used in conjunction with the production of coal and lignite, as is apparently intended by the general exclusion for wells used in conjunction with the production of "other minerals." The commission agrees, and has amended the section accordingly. One commenter noted that proposed sec.340.73 appears to differ from the requirements under discussion at the agency for sec.338.31 and sec.338.32 as to the persons to whom copies of well logs are to be submitted. The commission agrees, and has amended proposed sec.340.73 and sec.340.75 to add local underground water conservation districts and make these sections consistent. The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.5.2. Definitions. The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise. Advisory committee -A committee, council, commission, task force, or other entity created by or under state law, other than a state agency, that has as its primary function the provision of advice to the commission. sec.5.3. Creation and Duration of Advisory Committees. Except as otherwise provided by law, advisory committees shall be created by commission resolution. An advisory committee shall be abolished on the fourth anniversary of the date of its creation unless the commission has established a different date by commission resolution or votes to continue the advisory committee, or the advisory committee has a specific duration prescribed by statute. sec.5.8. Attendance. A record of attendance at each meeting of advisory committees shall be made. Except as otherwise provided by law, if a member of an advisory committee misses three consecutive regularly scheduled meetings or more than half of all the regularly scheduled meetings in a one-year period, that member automatically vacates his or her position on the advisory committee and the commission shall make an remainder of the unexpired term of the vacancy. sec.5.10. Presiding Officer. Except as otherwise provided by law or commission resolution, each committee shall elect from its members a presiding officer, chairperson, or co-chairpersons, who shall report the committee's advice and attendance in writing to the commission. The commission may, at its chairpersons, or co-chairpersons, of advisory committees. Committees may elect other officers at their pleasure. sec.5.11. Manner of Reporting. Advisory committees shall report in writing to the commission a minimum of once per year, unless otherwise directed by the commission. The report provided by an advisory committee shall be sufficient to allow the commission to properly evaluate the committee's work, usefulness, and the costs related to the committee's existence. sec.5.12. Subcommittees. Advisory committees may organize themselves into subcommittees. One member of each subcommittee shall serve as the chairperson of that subcommittee. Subcommittee chairs shall make written reports regarding their subcommittee's work to the presiding officer of the advisory committee. With the commission's consent, a subcommittee of an advisory committee may include members who are not members of the advisory committee with the consent of the commission, but must include at least one member of the advisory committee. sec.5.14. Records. Agency staff shall record and maintain the minutes of each advisory committee and subcommittee meeting. The staff shall maintain a record of actions taken and shall distribute copies of approved minutes and other committee documents to the commission and to advisory committee members. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606774 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 239-1966 Chapter 10. Commission Meetings 30 TAC sec.sec.10.1-10.9 The commission adopts new sec.sec.10.1-10.9, concerning procedural rules. Sections 10.1-10.3 and 10.6-10.9 are adopted with changes to the proposed text as published in the February 20, 1996, issue of the Texas Register (21 TexReg 1357). Sections 10.4 and 10.5 are adopted without changes and will not be republished. Section 10.10 has been withdrawn by the commission. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. Comments were received from Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts. Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts generally supported the adoption of the proposed sections with some changes. Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund, while apparently not opposing the adoption of the proposed sections as a whole, generally expressed concerns related to public participation and issues related to delegated federal programs. A number of commenters suggested minor editorial, typographical, and grammatical changes to clarify or shorten the proposed sections. The commission generally agrees with these suggestions, and has amended the proposed sections accordingly. These changes have been made to proposed sec.sec.1.1, 1.5, 1.7, 1.10, 1.11(a), 3.2, 5.3, 5.8, 5.10, 5.11, 5.12, 5.14, 10. 1, 10.2, 10.3, 10.6, 10.8, 20.17, 40.5, 40.6, 40.8, 40.9, 50.13, 50.17, 50.31, 55.21, 55.23, 55.25, 55.27, 55.29, 55.31, 70.2, 70.3, 70.4, 70.5, 70.6, 70.7, 70.8, 70.9(b), 70.10, 70.11, 70.101, 70.102, 70.104, 70.107, 70.108, 70.109, 80.3, 80.11, 80.17, 80.21, 80.23, 80.29, 80.31, 80.33, 80.109, 80.111, 80. 113(c), 80.115, 80.119, 80.127, 80.133, 80.155, 80.201, 80.205, 80.207, 80.209, 80.213, 80.251, 80.253, 80.257, 80.265, 80.267, 80.271, 86.1, 86.11, 86.15, 86.16, 86.34, 86.55, 86.96, 86.98, 86.99, 86.130, 86.131, 86.132, 340.41(b), 340.43(d), 340.45, 340.53(d), 340.71, 340.73, and 340.131. The titles of proposed sec.sec.10.9, 20.19, 40.5, 40.6, 40.8, 50.39(e), 55.31, 70.109, 80.5, 80.23(b), Chapter 50, Subchapter B and Chapter 86, Subchapter D have also been amended for clarity and to reflect their true content. Several commenters commented generally that the proposed sections limit public participation in permit and enforcement actions more stringently than allowed under federal law and do not meet the minimum requirements for federal program approval, basing this comment in part on a draft report prepared by one of the commenters. The commission disagrees. The commenters very narrowly construe the concept of public participation, and the commission does not agree that the statistics contained in the draft report are accurate. The commission does not agree that such a narrow emphasis on contested case evidentiary hearings at the expense of other methods of public participation is either fair or appropriate. The commission also does not agree that the proposed sections impose new limits on public participation. Although the commission's process will be continually reviewed and improved, the process and the proposed sections are consistent with the "United States Environmental Protection Agency's (EPA) Policy Statement of Public Participation," which contains no requirement for contested case hearings on every permitting matter. Public notice is given in compliance with statutory requirements, and when questions or comments from the public are received, the agency's technical staff responds to them. Agency permit engineers and attorneys spend a considerable amount of time answering questions from the public, meeting with them, educating citizens on both the scientific and legal requirements of permits. As questions are raised, staff reconfirms the review and position it is taking on permits. When there is considerable public interest expressed, the agency often will hold one or more public meetings in the local area to encourage give and take between the public, the applicant, and the staff. This is in addition to public meetings that may be required by statute (e.g., Texas Health and Safety Code, sec.361.0791, on hazardous waste management permits). Most importantly, the commenters overlook the provisions of the proposed sections which in fact dramatically increase the opportunity for public participation--now, every motion for reconsideration of an executive director's action goes directly to the commission, and every hearing request is placed on a commission meeting agenda with the right of the requestor to share information and concerns directly with the three commissioners. Most determinations on hearing requests, prior to September 1, 1995, were handled by the Office of Hearing Examiners with little, if any, involvement by the commissioners. The public now has the ability to submit information and concerns to the commissioners, very often has the ability to personally address the commissioners, and the commissioners have the ability to require the applicant and the executive director's staff to respond to those concerns. The exchange takes place in a posted, public hearing. This satisfies the "exchange of views and open exploration of issues, alternatives, and consequences" standard contained in the EPA Policy Statement. Although the commission believes that the proposed sections represent a dramatic improvement, the commission continues to explore ways to enhance this exchange of views. Several commenters suggested that the commission failed to provide notice of the procedural rule changes to the EPA as required. The commission disagrees. The commenters erroneously interpret 42 United States Code, sec.300h- 1(b)(1)(A)(ii) to require notice prior to final adoption of this rule package. Correctly read, the statute only requires notice of a rule change to the EPA after final adoption of an underground injection well program or changes to the program. Upon adoption of this package, the commission will provide appropriate notice to the EPA. One commenter suggested that proposed sec.1.1 be expanded to address both the purpose and scope of the commission's rules. The commission disagrees with this proposal because the language proposed would state what is already law, that the rights of parties and the commission's powers are established by statute and cannot be enlarged by rule, and that the statutes prevail if the commission's rules are in conflict with them. Several commenters criticized the commission's handling of confidential documents under current rules being revised and adopted as proposed sec.1.5. The commission disagrees with these comments because the commission's management of confidential documents complies with all applicable requirements. Another commenter proposed additional language for this section which would specify the duties of the agency's central records office. The commission disagrees, because the proposed directives concerning internal office procedure can be made without adopting the directives as a rule. The commission notes that it has recently directed its executive director to evaluate the agency's record management practices. This evaluation is already under way, and will include the agency's handling of confidential documents to ensure they are not inadvertently disclosed to the public. A request for proposal has been published for a study on the matter. One commenter suggested that proposed sec.1.11 be amended to make it clear what is included in the phrase "courier-receipted delivery service." The commission believes that the phrase is sufficiently clear, and declines to add any definition beyond that already provided in Texas Rule of Civil Procedure 21a. The commission believes that the modifications to proposed sec.1.11 described as follows may also resolve the commenter's concerns. One commenter noted that proposed sec.1.11 and sec.10.10 appear to be missing subsection (e), which appears in old sec.261.18, from which they are derived. The commission agrees. This deletion was inadvertent, since proposed sec.1.11 and sec.10.10 were intended to include the provisions of old sec.261.18. Proposed sec.10.10 duplicates proposed sec.1.11 and has been deleted, and subsection (e) has been added to proposed sec.1.11. In addition, the commission has further clarified proposed sec.1.11 by more closely tracking Texas Rule of Civil Procedure 21a, which the commission believes covers the same subject matter more completely, and has amended and renumbered subsections accordingly. One commenter suggested that proposed sec.3.2 be revised to incorporate several definitions currently contained in other chapters. The commission agrees in part, and has added definitions of "enforcement action" and "enforcement order" to proposed sec.3.2. Other definitions not moved are used only in single chapters, and the commission believes it more useful to leave those definitions in the chapter to which they apply, rather than move them to a general definitions section. The commission intends, however, to continue to consolidate widely used definitions in Chapter 3 for clarity and consistency. One commenter suggested that the definition of "advisory committee" in proposed sec.5.2 be condensed. The commission agrees, and has amended the proposed section accordingly. This commenter also suggested that this definition be moved from proposed sec.5.2 to proposed sec.3.2. Since this term seems to be used only in proposed Chapter 5, the commission disagrees and has left the definition in proposed sec.5.2. One commenter suggested that proposed sec.10.7 be amended to clarify that the commission will keep a certified agenda of closed meetings held in accordance with the requirements of the Texas Open Meetings Act. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.10.9 and sec.10.10 duplicate proposed sec.1.10 and sec.1.11, and suggested that the proposed sections appear only in proposed Chapter 1. The commission agrees, and has deleted proposed sec.10.10 and amended proposed sec.10.9 to change its title and refer to proposed sec.1.10 and sec.1.11. One commenter suggested that proposed Chapter 40 be amended to allow participation in Alternative Dispute Resolution (ADR) by "interested parties" and to allow mediation to occur before a request for hearing is made. While the commission wholeheartedly supports ADR efforts, it disagrees for two reasons, and declines to make the change. First, participation in ADR in contested cases must necessarily be limited to the parties to the case, or at the hearing request stage, to those filing hearing requests as well. Without this limitation, the commission believes it will be difficult for participants to commit to a process where the number and identity of negotiating parties is subject to change. Second, while the commission is strongly committed to ADR, and encourages its use at all stages of the application process, it believes that it is wiser to continue to encourage informal ADR outside of agency rules prior to entry into the contested case process, and leave its use up to the participants, rather than attempt to promulgate rules governing its use at this time. One commenter suggested that the definition of the term "alternative dispute resolution office" in proposed sec.40.2 be replaced with a definition of the term "alternative dispute resolution director" because the latter is used throughout proposed Chapter 40. The commission agrees, has amended the proposed section accordingly, and has also amended proposed sec.40.5(a)(1) accordingly. One commenter suggested deleting the words "regardless of which ADR method is used" from the definition of "mediator" in proposed sec.40.2, as not adding to the definition. The commission disagrees, because it believes that the term "mediator" is used in some circles as a term of art to refer only to a person engaged in specific dispute resolution procedures, and the term is used in these proposed sections in a more inclusive manner. One commenter suggested using the word "applicant" rather than a longer term in the definition of "participant" in proposed sec.40.2, and adding "named parties" to the definition to make clear that they are included in the definition. The commission agrees, and has amended the proposed section accordingly. One commenter suggested deleting the words "from the pool of mediators" from the first sentence of proposed sec.40.4(a) and adding clarifying language regarding private mediators, to make the proposed section more consistent with the other proposed sections of the chapter. The commission agrees, and has amended the proposed section accordingly. One commenter suggested rewording proposed sec.40.4(c) for brevity and clarity. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.40.6 could be read to exclude the possibility of a matter being referred to ADR after a draft permit is proposed and a protest letter received, but prior to the matter being referred to the State Office of Administrative Hearings (SOAH), as proposed sec.55.25(d)(1) anticipates, and suggested amending the proposed section. The commission agrees with the commenter that this can be the most productive period for ADR, expressly desires to encourage ADR at this point, and has amended the proposed section to make it clear that cases may be referred to ADR at this point and that ADR outside of the commission process may be used at any time. Several commenters commented that proposed sec.50.13 and sec.50.33 allow the commission and its executive director to act on an application without considering any comments, and generally maintain that the proposed sections of procedural rules as a whole preclude public comment. The commenters also claim that the provisions of proposed sec.50.33 which prevent action by the executive director where there is a "protest" and the provision for motions for reconsideration are not an adequate substitute for a public comment process. The commission disagrees, and declines to amend the proposed sections. Proposed sec.50.13 and sec.50.33 allow action without a contested case hearing, which is not equivalent to action without considering comments. The procedures contained in the proposed procedural rules sections are, for the most part, in addition to the commission's public comment process, rather than a substitute for them, as the commenters apparently assume, and the equation of participation in a contested case hearing with public comment is inappropriate. The commission actively encourages public participation, and has gone on record repeatedly to express this and to broaden public participation, but believes that the amendments suggested by the commenters go far beyond the scope of this rulemaking. One commenter suggested that proposed sec.50.39 be amended to allow only an "affected person" to file a motion for reconsideration of an executive director's action on an application, suggesting that the term "other person" is too broad. The commission disagrees, and declines to change the proposed section, because the proposed language gives the commission flexibility to reconsider decisions in situations where the error complained of merits attention regardless of who raises it. Additionally, allowing any person to file a motion for reconsideration allows another avenue for public comment by bringing concerns directly to the attention of the commission. The commission believes, however, that the question of whether a person filing a motion for reconsideration is an affected person will in some cases have a bearing on whether the commission acts on the motion. Several commenters criticized proposed sec.55.21(b) and (d), claiming that because of multiple publications, it may be difficult to tell when the deadline for a hearing request occurs. While much of the timing and many of the contents of notices are specifically required by statute, to the extent that this becomes a problem, the commission plans to deal with it in rulemaking on a new proposed chapter governing public notice, rather than in this rulemaking. Several commenters suggested that proposed sec.55.21(c) constitutes an unlawful delegation and allows the person who designs a notice to decide what will be required in a hearing request. The commenters further assert that the proposed section does not adequately plan for errors in the published notice. The commission disagrees, and declines to change the proposed section. The statutes and other sections of the commission's rules dictate the content of public notices, and this proposed section merely requires hearing requests to comply with those requirements, if any. If the notice is defective, this must be generally cured through republication, thus giving another chance to comply with any requirements. Several commenters criticized proposed sec.55.21(e) for not establishing procedures for requesting extensions of time and suggested the inclusion of a "good cause" or public interest test. The commission disagrees. This section is primarily intended to allow the commission to consider late hearing requests. The commission believes that the proposed section allows more flexibility for the commission and the public than the suggestion does, and declines to change the section. One commenter suggested that proposed sec.55.23(b) be revised to require a group or association to provide an explanation of its hearing request with sworn affidavits, written resolutions, or other satisfactory documentation, rather than to allow other parties to request such an explanation. The commission disagrees. While the proposed sections anticipate that a group or association will submit such information, requiring this as an absolute requirement in advance when the group or association's qualifications are not in dispute is burdensome and unnecessary. However, allowing the listed parties to request that evidence, if they believe it to be an issue, protects the integrity of the hearing process and the rights of the applicant while limiting evidence and testimony to those issues that are actually in dispute. Several commenters suggested that proposed sec.55.23(b) and sec.55.26(f) place unreasonable burdens on the public in replying to responses to hearing requests. There is no proposed sec.55.26 and the latter reference is apparently to proposed sec.55.25(f). The commission disagrees, because these proposed sections merely provide a way for the commission and other parties to determine the basis of a hearing request, which is clearly relevant under Texas Water Code, sec.5.115. While the commission does not agree that the proposed time periods are unreasonable, it has determined that the time for replying to responses to hearing requests in proposed sec.55.25(f) should be lengthened from ten days to 14 days to give requestors more time to prepare, and has amended proposed sec.55.25 accordingly. Several commenters suggested that the commission amend proposed sec.sec.55.25, 55.27, 55.29, and 55.31, to change the way the commission deals with hearing requests and with determinations of whether a person is an "affected person," whether a request is "reasonable," and what constitutes "competent evidence" under Texas Water Code, sec.5.115. The commission agrees that these items may need further attention, but, as announced at the beginning of this phase of rulemaking and stated in the preamble to these proposed rules, has reserved this issue for further rulemaking, once sufficient experience has been accumulated with the existing process to fairly evaluate how well the existing rules are working. This project is already underway at the agency, and the commission expects that it will get into full swing shortly after this rulemaking project is concluded. While some minor adjustments to the current process are included in this round of rulemaking, the commission declines to make the suggested major changes in this round of rulemaking. Several commenters suggested that the proposed sections place an unreasonable burden on who can qualify for a hearing and claimed that the commission has not implemented its authority to provide for public participation in hearings. The commission disagrees. As noted previously, the commission believes that the proposed sections broadly encourage public participation. In addition, the proposed sections are entirely consistent with the law on hearings and standing. Finally, the commission is already committed to reviewing this process in another round of rulemaking. Several commenters suggested that proposed sec.55.25(g) be revised to allow a legislator (for an activity in the legislator's district), a state agency, a federal agency, or a local government (for a facility within the local government's jurisdiction) to send an application directly to SOAH for a contested case hearing. The commission disagrees. Nothing in the statutes grants such blanket rights, and the commission believes that adding this provision would violate both the letter and intent of Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115, as well as other specific statutes dealing with contested case hearings, and therefore declines to make this change. One commenter noted that the provisions of proposed sec.55.27 and sec.55.29 do not appear to address instances where the definition of affected persons in the rule (and in Texas Water Code, sec.5.115) may differ from specific statutory provisions defining "affected person" or "person affected," and suggested that the proposed sections be revised to make it clear that specific statutory provisions control. In the alternative, the commenter suggested that the commission apply both the definition of "affected person" in the proposed sections and any specific statutory definition. The commission agrees with the commenter that Texas Water Code, sec.5.115, the proposed sections, and other specific statutes can and should be read together. Generally, Texas Water Code, sec.5.115 will require a "personal justiciable interest," while other specific statutory provisions delineate those interests, specifying distance limitations or identifying specific persons who can request a hearing. The commission believes that the provisions of proposed sec.55.27 (that a hearing request be granted if it is "pursuant to a right to hearing authorized by law") and proposed sec.55.29 (that a relevant factor in determining whether a person has "a personal justiciable interest related to a legal right, duty, privilege, power, or economic interest affected by the application" is "whether the interest claimed is one protected by the law under which the application will be considered") require Texas Water Code, sec.5.115 and any applicable specific statute to be read together. Thus, the commission declines to modify the proposed sections. Several commenters suggested that proposed sec.55.27(b) and (c) be amended on the grounds that they conflict with statutory provisions such as Texas Water Code, Chapter 27, in which counties are granted hearings regardless of a showing of standing or reasonableness of their hearing requests. The commenters also suggested that the test for a state agency or local government needs to be clarified, alleging, for example, that a county is automatically an affected person for an activity in that county. The commission disagrees. No statute, other than those giving party status to the executive director, public interest counsel, Texas Water Development Board, and Texas Parks and Wildlife Department, provides as a blanket rule that a governmental entity is automatically an affected person for all activities in a geographic area, although some do in specific instances. Texas Water Code, sec.27.018, for instance, provides for a hearing on an injection well permit application if one is requested by a "local government." The statute further distinguishes between the terms "local government" and "affected person"--a distinction that does not appear in Texas Water Code, sec.5.115. While there may be some confusion over the use of the term "affected person" in more than one context, the commission believes that it is clear that a hearing request by a local government under Texas Water Code, sec.27.018 meets the tests of reasonableness and being "pursuant to a right to hearing authorized by law" under proposed sec.55.27(b) and "in the public interest" under proposed sec.55.27(c), and that a governmental entity may be an affected person given the definition of "person" contained in proposed sec.3.2 and its "authority under state law" in proposed sec.55.29(b). The commission further believes that the tests for a state agency or local government are sufficiently clear, and therefore declines to amend the proposed sections. Two commenters suggested that the provisions of proposed sec.55.27(c), which allow the commission to refer an application to SOAH for hearing if the commission determines that a hearing would be "in the public interest" even if there is no valid hearing request, be deleted or that the commission delineate standards it will use in making this determination. Several commenters suggested that the provision is vague in that it does not define "public interest." The commission disagrees with these comments and declines to make the suggested changes, in that it believes that there may be situations where the public interest demands a hearing (one example might be information received after the deadline for hearing requests), and also believes that it would be impossible to define "public interest" at this time in terms more specific than those used by the statutes under which the commission operates. One commenter suggested that proposed sec.55.27(c) be deleted as duplicative of proposed sec.55.27(b)(1). The commission disagrees and declines to make the proposed change. Proposed sec.55.27(b)(1) allows a commissioner, an applicant, or the executive director to request a contested case hearing and thereby refer a case to SOAH, while proposed sec.55.27(c) allows the commission as a whole to vote to send a case to SOAH. The two provisions serve different purposes and the commission believes they should be kept separate. Several commenters suggested that the commission's rules on notice need significant changes, and suggested that proposed sec.55.27(c) be amended to prohibit the final notice on a permit from being issued before technical review is complete and a draft decision is available. The commission does not agree that these proposed sections are the place to deal with notice requirements, notes that no notice has been given to the public or interested parties that notice requirements would be changed in these proposed sections, and points out that it is in the process of preparing for publication a new chapter to consolidate many of its notice rules. However, the commission disagrees with the commenters that the existing rules regarding notice are inadequate or restrict public participation. Proposed sec.55.27(c) does not deal with notice, but rather allows the commission to refer an application to SOAH even if there is no hearing request, and the commission does not agree that amending it to deal with notice would be appropriate or advisable. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear whether an administrative law judge can overrule a commission denial of a hearing request based on standing. The commission has amended proposed sec.55.27(f) to make its position on this issue more clear--that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear what must be done to appeal the denial of a hearing request, do not make it clear when the time period for appeal begins to run, and add new burdens by requiring two appeals. The commission does not agree, and declines to further amend the proposed sections beyond the amendments already described. The proposed sections make it clear that a party whose hearing request is denied must seek to obtain party status and then, if unsuccessful, follow procedures for a motion for rehearing as a prerequisite to appeal once the commission has disposed of the application. Since a person who files a hearing request is asking that a contested case hearing be held, that party obtains the relief sought if any hearing request is granted. That person must then seek to be admitted as a party if the person wishes to participate in the case, and decisions on that issue will be handled as they are now, although the commission anticipates that if the person has a complaint at this point, it will be the denial of party status or a limitation of issues rather than a determination on a hearing request. If all hearing requests are denied or withdrawn, persons whose requests are denied have an opportunity for the review of that decision by filing a motion for rehearing after the commission's decision on the application--that is, at the end of the case, rather than in an interlocutory appeal, as the commenters seem to suggest. The commission believes that it is clear in the proposed sections that the time period for appeals begins to run at this point. While the commenters also suggest that it is unreasonable to force parties to go through a hearing and have the result of that hearing reversed by a court based on an error in denying party status, the commission believes that the risk of this kind of result is minimal, is inherent in every determination of party status in any kind of proceeding, and is outweighed by the burden to the public that would be imposed by delaying every permitting decision until determinations of party status are appealed through the court system. Two commenters noted that proposed sec.55.27(f) allows a person whose hearing request is denied to still seek to be admitted as a party, and suggested that absent some compelling reasons, the commission's determination on the hearing request should preclude the later admission of the person as a party. The commission disagrees, and has amended the proposed section as noted previously to make it clear that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. One commenter suggested that proposed sec.55.27 be amended to allow a motion for reconsideration, rather than a motion for rehearing, of the denial of a hearing request, suggesting that the latter is only appropriate in contested cases under the Administrative Procedure Act, and that no contested case arises if a hearing request is not granted. The commission disagrees. As stated previously, the commission believes that a decision on the validity of a hearing request is an interlocutory decision only on the validity of the request, and does not necessarily dictate the outcome of a later decision on party status, or standing. The commission believes that a motion for rehearing at the conclusion of the proceedings is the most appropriate way to review such a decision. Several commenters remarked that the proposed sections do not allow for an adequate record for judicial review when no contested case hearing is held and do not establish standards for a court to use in its review. The commenters also suggest that the proposed sections do not create an adequate record in rulemaking. The commission disagrees, and declines to make changes based on this comment, because it believes that the record created is sufficient for judicial review of the commission's actions, and the standards of review are already clearly established in the statutes and rules. Similarly, the commission believes that the record created in rulemaking proceedings is more than adequate. Several commenters suggested that proposed sec.55.29 and sec.55.31 be revised to provide that the commission accept as true written statements of a person filing a hearing request for the purposes of the determination on the request or the person requesting a hearing be given an opportunity to present evidence to meet the burden of presenting competent evidence under Texas Water Code, sec.5.115. The commission disagrees and declines to make these changes. The first alternative ignores the clear intent of Texas Water Code, sec.5.115, by allowing a person to meet its standards by simply claiming that the standards are met. Texas Water Code, sec.5.115 provides that the commission "is not required to hold a hearing if the commission determines that the basis of the person's hearing request is unreasonable or is not supported by competent evidence." The second alternative does not recognize that this determination will require different procedures in different cases, and the flexibility which the proposed sections provide--from a decision on the pleadings to oral argument to an evidentiary hearing--allows for procedures to be followed which are appropriate for the cases presented. For example, a permit renewal under Texas Health and Safety Code, sec.382.056 may be an example of a case where requests not alleging increases in emissions or compliance problems can be dealt with on the pleadings alone. Similarly, a person who cannot allege a reasonable basis for a hearing request or who cannot allege that competent evidence exists to support the request, despite having more than one opportunity to do so (the request itself, a reply filed under proposed sec.55. 25(f) to responses that point out the merits or deficiencies of the request, and, in appropriate cases, argument or testimony before the commission) is not going to be able to present such evidence at a hearing, and it may be appropriate to resolve this request without an evidentiary hearing. Several commenters suggested that proposed sec.55.31 is unconstitutionally vague and conflicts with other Texas Natural Resource Conservation Commission rules and the law, specifically proposed sec.55.29 and Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115 and that the provisions of proposed sec.55.31(b)(3) are overly burdensome on public participation. The commission disagrees. The commission believes that the proposed section fully complies with the constitution and with Texas Health and Safety Code, sec.382. 056 and Texas Water Code, sec.5.115. The term "reasonableness" is adequately defined by proposed sec.55.31. Further, proposed sec.55.31 does not conflict with proposed sec.55.29, because they deal with different matters--the first with the determination of whether a person is an "affected person," and the second with whether a hearing request is "reasonable." Several commenters suggested that the proposed rules be revised to "provide that the commission will make determinations and record those determinations so that the public can understand the basis for its government's decision and so that a reviewing court can determine if the actions of the commission should be affirmed or reversed." As noted previously, the commission believes that the proposed sections do exactly that and declines to make changes based on this comment. Several commenters suggested that proposed sec.55.33(a)(3) (and presumably proposed sec.80.5(a)(3)) be revised, claiming that the proposed section requires the Chief Clerk to pay the cost for issuing public notices. The commission disagrees, since the proposed section requires the clerk to issue notice and does not provide for the Clerk to pay the cost of notice, since applicants are clearly responsible for those costs. Proposed sec.55.33 has been withdrawn, however, and only proposed sec.80.5 now governs the Chief Clerk's actions in this context. Several commenters noted that the setting procedures of proposed sec.55.33 largely duplicate those of proposed sec.80.5, and suggested the deletion of one or the other. Some commenters suggested conforming these two proposed sections. The commission agrees that these sections are duplicative and should be conformed, and notes as well that proposed sec.70.109 largely duplicates both of these sections. For clarity, the commission believes that it is most logical to lay out all setting procedures only in proposed Chapter 80, and has deleted proposed sec.55.33 and amended proposed sec.70.109 accordingly. Several commenters suggested that the proposed sections of proposed Chapter 70 limit public participation in enforcement proceedings in a fashion that does not meet the federal requirements for such participation and further state that notice in the Texas Register is insufficient. The commission disagrees, and declines to change the proposed sections. The agency complies with federal authorization rules regarding public participation in enforcement matters, which require the agency to have procedures in place for responding to citizen complaints, publish notice of settlements of civil actions, and give assurance that it will not oppose intervention by any citizen when permissive intervention is authorized by statute, rule, or regulation. In regard to the comment that Texas Register publication is insufficient, while the commission disagrees, it is currently considering alternative citizen participation in administrative actions. If rule changes are necessary after a decision is made on this issue, they will be taken up separate from this rulemaking. One commenter suggested that the definitions of "enforcement order," "enforcement action," "petition," and "respondent" be moved from proposed sec.70.2 to proposed sec.3.2. The commission agrees that the definitions of "enforcement action" and "enforcement order" should be moved to sec.3.2 since they are used in general context in other chapters of the agency's rules; however, the terms "petition" and "respondent," as they are defined in proposed Chapter 70, are specific to enforcement actions by the commission only and should remain in proposed Chapter 70. The commission does not believe that generic definitions of petition and respondent are necessary in proposed Chapter 3 to cover permitting matters because those terms are generally accepted legal terminology and "petition" is already included in the definition of "application." One commenter suggested that proposed sec.70.51 substantially changes old sec.337.71 from relating only to water rights enforcement matters to a more general mandatory enforcement hearing process. The commission disagrees. The language in proposed sec.70.51 was taken verbatim from old sec.337.71, except that the title of the subchapter was changed and references to other rules which had been renumbered were changed. The definitions included in old sec.337. 71 included water quality, water rights, hazardous waste releases, and references to the air statute as well. Although the title of old sec.337.71 indicated "Water Rights Enforcement," its statutory basis is Texas Water Code, sec.5.117, which applies to the agency as a whole, and requires the executive director to bring all instances of substantial noncompliance before the commission. The commenter expressed concern that proposed sec.70.51 would require mandatory hearings for incorrect compliance with record keeping requirements in an air permit. Since this would normally not be a substantial noncompliance under the air rules, this section would not apply in that case. Furthermore, old sec.337.71 and proposed sec.70.51 both exclude air violations, since a separate statutory requirement exists for the air program. The program most affected by this statutory requirement is the water quality program, which has a large amount of self-reporting data submitted each month. The proposed section basically sets forth the practice of the watershed management and enforcement divisions in processing this large volume of documents and describes how they determine what constitutes a substantial noncompliance. One commenter suggested that the concept of "executive director preliminary reports" (EDPR), used in proposed sec.70.101, is not necessary in proposed Chapter 70 and is not mandated by statute. While EDPRs are not required by statute, they are clearly allowed and anticipated by statute (see Texas Water Code, sec.sec.13.4151(c) and (d), 26.136(d) and (e), 27.1015(d) and (e), 34. 011(d) and (e) and Texas Health and Safety Code, sec.sec.341.049(c) and (d), 361. 252(d) and (e), 366.0924(d) and (e), 382.088(d) and (f), and 401.384- 401.385). This rulemaking does not alter the provisions in old Chapter 337 regarding preliminary reports, and sets forth the agency's procedures if preliminary reports are chosen as the form of pleading in a case. The executive director is not required to issue a preliminary report, but is given an option which may be used on a case-by-case basis, which is consistent with the statutory provisions. The commission disagrees with the comment and declines to change the proposed section. The commission has determined that the setting procedures of proposed sec.70. 109 largely duplicate those of proposed sec.80.5, and has amended them to simply refer to proposed sec.80.5. The commission has also amended the title of this section for clarity. One commenter suggested that proposed sec.80.3(a) be amended to make it clear that the judge sitting in a phase of a hearing, not the presiding judge, will resolve evidentiary questions raised during that phase of a hearing. The commission generally agrees, but believes that it may be necessary for a judge sitting in one phase of a hearing to refer some important evidentiary questions to the presiding judge, and has amended the section accordingly. Two commenters suggested that proposed sec.80.3(b)(10) be revised to make it clear that the judge may limit the time of presentation of evidence and witnesses without unfairly prejudicing the rights of parties. The commission agrees, and has amended the rule accordingly. In addition, the commission believes that splitting proposed sec.80.3(a) into two subsections and redesignating proposed sec.80.3(b) as sec.80.3(c) makes the proposed rule more readable, and has amended it accordingly. Two commenters suggested that proposed sec.80.5(b) be amended to expressly state that the commission may limit the issues that shall be considered by SOAH in a contested case. The commission agrees that this ability is implicit in Texas Government Code, sec.2003.047(e), and has amended the proposed section accordingly. These commenters also suggest that the proposed section be amended to provide that the commission "may," rather than "shall," identify issues to be addressed. Since Texas Government Code, sec.2003.047(e) uses "shall," the commission disagrees and declines to make this change. The commission has amended proposed sec.80.5(b) to make it clear that the executive director's petition or EDPR serves as the list of issues to be addressed by SOAH in a contested enforcement case. One commenter suggested that proposed sec.55.33(b) (the same as proposed sec.80.5(b)) be deleted, stating that while the commission may want to restrict or direct the list of issues, the proposed section suggests that a referral is not adequate if it does not. The commission disagrees, since Texas Government Code, sec.2003.047(e) clearly mandates an issues list, and since the proposed section gives the commission the flexibility to submit both broad and narrow ranges of issues. Several commenters suggested that proposed sec.80.13 be amended to allow parties, as well as the executive director, to request consolidation of related proceedings. The commission disagrees and declines to change the proposed section, because this is already allowed by the proposed sections. Proposed sec.80.13 allows the executive director to consolidate matters with the permission of the judge, and allows the judge to consolidate matters, presumably on the judge's own motion or that of any party. One commenter noted that due to changes in Chapter 291 of the commission's rules, proposed sec.80.17 does not accurately reflect the burden of proof in certain water and sewer rate cases. The commenter also noted that enforcement cases covered by subsection (c) of the rule should be expressly excepted from subsection (a). The commission agrees, and has amended the proposed section accordingly. One commenter suggested that proposed sec.80.27 be deleted as duplicative of proposed sec.sec.1.08, 1.10, 1.11, and 80.31. While the proposed sections cover similar matters, the commission disagrees and declines to make the change, because proposed sec.80.27 covers mostly matters of form, while the other proposed sections deal with more procedural matters. The commission has amended proposed sec.80.101 to make it clear that the executive director may either act on a matter remanded to the executive director or set it for consideration at a commission meeting. This is allowed by the proposed section, but the amendment lends clarity. One commenter suggested that proposed sec.80.107 is of sufficient importance that it should be dealt with as a separate subchapter. While the commission agrees that the proposed section is important, it prefers as a matter of form at this time not to create additional subchapters, and declines to make the change. One commenter suggested deleting the phrase "administrative law" from a reference in proposed sec.80.107(a)(3) to result in consistent references to the presiding officer as "judge." The commission agrees, and has amended the proposed section accordingly. One commenter suggested amending proposed sec.80.109(b) to define only statutory parties. The commission disagrees, and believes that the proposed section serves a more useful function by referring to all parties to an application, rather than just statutory parties, and declines to make this change. One commenter suggested deleting proposed sec.80.109(c) as duplicative of proposed sec.80.115. The commission agrees, and has amended the proposed section accordingly, renumbering the subsequent subsections. One commenter suggested deleting proposed sec.80.109(d) (now sec.80.109(c)) as duplicative of proposed sec.80.3(b)(5). The commission disagrees, since the section as amended in response to comments on proposed sec.80.115 now makes it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. One commenter suggested moving proposed sec.80.109(e) ((now sec.80.109(d)) to proposed sec.80.119, arguing that it makes more sense to discuss the effects of continuance in that section. The commission disagrees and declines to make the change. Proposed sec.80.109(e) (now sec.80.109(d)) is intended to make it clear that a person designated as a party retains party status regardless of any postponement of a hearing. Since the rule is limited to party status, the commission feels that it makes more sense to leave it in its present location. Several commenters commented that proposed sec.80.111 prohibits the judge and commission from considering comments. The commission disagrees, and points out that the section does not at all impair the executive director's ability to consider comments. The proposed section prohibits the judge from considering protests or comments submitted by non-parties in a non-evidentiary context (not under oath and without the opportunity to cross-examine) as evidence in contested case proceedings. The commission believes this is required by law, and declines to change the proposed section. The commission notes, however, that the phrase "[i]n proceedings other than enforcement proceedings" was inadvertently published as the end of the second sentence of this section, rather than as the beginning of the third sentence. The commission has amended the section accordingly, so that this limitation applies to questions submitted to the judge, not to the consideration of comments. One commenter noted that proposed sec.80.115 is not clear as to whether each and every party has a right to conduct discovery, present a direct case, cross- examine witnesses, obtain copies of pleadings, and so on, even when parties have been aligned under proposed sec.80.109. The commission agrees that the two provisions could be confusing when read together, and has amended proposed sec.80.109(d) to make it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. The commission anticipates that judges will exercise their best judgment when aligning parties and specifying the purposes for which they are aligned. One commenter suggested that proposed sec.80.117(b) be revised to make it clear that all persons granted party status are covered in the order of presentation. The commission agrees, and has amended proposed sec.80.117 by substituting the words "other parties" for the word "protestant." One commenter suggested deleting the word "SOAH" from proposed sec.80.119(d) to make it clear that the section does not restrict the judge in a contested case proceeding to the use solely of SOAH mediators. The commission agrees, and has amended the proposed subsection accordingly. The subsection has also been combined with proposed sec.80.119(c), to make the section shorter and more clear. One commenter suggested combining proposed sec.80.127(a)(2) and (c) to eliminate duplication. The commission agrees, and has amended the proposed section and renumbered subsections accordingly. One commenter suggested that proposed sec.80.127 be revised to more closely track the provisions of Texas Rule of Civil Procedure 267 and Texas Rule of Evidence 613, which prohibit the exclusion from the hearing room when "the rule" is invoked of an officer or employee of a party that is not a natural person and who is designated as its representative by its attorney and a person whose presence is shown by a party to be essential to the presentation of its case. The commission agrees, and has added subsection (f) to the proposed section so that it will more closely track the practice in the courts. One commenter suggested amending proposed sec.80.133 to allow the judge to set a schedule for the submission of written briefs. The commission agrees, and has amended the proposed section accordingly. Two commenters suggested that proposed sec.80.137 be amended to incorporate by reference Texas Rule of Civil Procedure 166a, because of the substantial body of interpretive case law and legal commentary available. The commission agrees that Rule 166a contains valuable guidance, and has tried to track the language of the rule in the proposed section as far as it considers appropriate given the difference between the administrative and judicial processes and the commission's assumption that the most likely use of the proposed section will be to limit issues, rather than to dispose of applications. The commission has accordingly modified the proposed section to track Rule 166a more closely, and anticipates that practitioners and judges will look to Rule 166a and the decisions construing it for guidance. Two commenters suggested that proposed sec.80.137 be amended to change some language relating to testimonial evidence. Because of the amendments noted previously, the commission believes the issue raised by this language to be resolved and declines to make further changes. One commenter suggested that proposed sec.80.151 be amended to expressly refer to Texas Rule of Civil Procedure 215. The commission disagrees, and declines to change the proposed section, because it believes that the grant of authority in Texas Government Code, sec.2003.047 and the sanctions provisions of proposed sec.80.107 already make sufficient provision for sanctions for discovery abuse. One commenter suggested that proposed Subchapter E of Chapter 80 (the "Freeze Rules") be deleted. While the commission recognizes the commenter's concern, it feels that the "freeze rules" have not yet been given a real test in practice, and is inclined to amend, rather than repeal them. The commission has corrected an incorrect reference in proposed sec.80.205 to refer to sec.80.105, rather than sec.80.60. Several commenters suggested that proposed sec.80.203(a)(1) be amended so that it does not require the executive director to prepare a draft permit if the executive director does not recommend the issuance of a permit. The commission disagrees, and declines to make this change, in part because the "freeze rules" were the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome, and in part because the failure to prepare a draft permit would present an almost insuperable barrier to an applicant should the applicant prevail on the issue of whether or not a permit should be issued. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.207(c) be amended to eliminate the additional time proposed beyond the first discovery period for filing a list of issues. The commission disagrees, and declines to make this change. An earlier version of this rule required protestants to have their issues list finished simultaneously with the end of the first discovery period, which the commission believes compresses the work that must be done. The commenter suggested that in the event the additional time remained, additional time should be added to proposed sec.80.207(e) as well. The commission disagrees and declines to make this change, since additional time is already granted by timing the applicant's response from the time the first list of issues is submitted, rather than the close of the first discovery period. Several commenters commented that proposed sec.80.207(d) allows an applicant to disrupt the work required of protestants to comply with subsection proposed sec.80.207(c), and suggested the deletion of the second sentence in subsection (d). The commission disagrees, and declines to make this change. The commenters apparently missed the time extension given in proposed sec.80.207(c), which now allows for completion of the issues list "within 20 days after the end" of the time period originally contained in old sec.265.104, from which the proposed section is derived. The result of the proposed sections is to give the protestant an additional 20 days to complete the issues list, while allowing the applicant to go forward with discovery. The result, rather than an additional burden on the protestant, is an easing of requirements. One commenter suggested that proposed sec.80.207(h) be amended to allow a limited amendment of the application in some circumstances. While the commission agrees that this commenter's point has some merit, the current arrangement was the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.209(c)(3) be amended to require the judge to distribute a prehearing order within four days from the prehearing conference. While the commission recognizes the commenter's concern and the limited (14-day) time period between the prehearing conference and the hearing, it prefers at this time to leave the timing of the prehearing order to the judge, trusting that prehearing orders will be distributed as soon as possible considering the compressed time frame. Two commenters suggested that proposed sec.80.213 be revised to make it clear that paragraph (1)(A) and (B) is not mutually exclusive and that the judge may direct a party to both voluntarily reduce its listed witnesses and provide a summary of the expected testimony of each witness. One commenter also suggested that the language of the rule be made more clear that the judge may prohibit testimony of witnesses. The commission agrees, and has amended the section accordingly. Several commenters suggested that proposed sec.80.259 be revised to eliminate a provision that would allow a judge to file an amended proposal for decision without serving it on the parties. This provision was included in a redline/strikeout version of the proposed rules distributed by agency staff during the rulemaking process, but was dropped from the proposed rule before publication, and thus no revision to the proposed rule is necessary. The staff regrets any inconvenience caused by failing to notify interested persons of the change before publication. The commission has amended proposed sec.80.263 to make it clear that the general counsel may set time limits for oral presentations before the commission. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.sec.80.265, 80.267, and 80.271 to remove the word "final" where it refers to commission decisions or orders, because the use of the word in these proposed sections may be unintentionally confusing when compared with the use of the word in Government Code, sec.sec.2001.141 - 2001.144, dealing with when decisions become final. One commenter suggested that the provision of proposed sec.80.267(b) that the commission will render a decision within 60 days after the date the hearing is finally closed does not give the commission enough time to render its decisions. The commenter suggested lengthening the time period to 90 days. The commission agrees that cases heard by a judge may take more than 60 days, but notes that the 60-day period is mandated by Texas Government Code, sec.2001. 143 unless extended. The commission believes, however, that proposed sec.80. 267(b) gives the judge enough flexibility to extend the time, and therefore declines to make the suggested revision. The commission has amended proposed sec.80.277 to more clearly reflect the commission's position and longstanding agency practice that the executive director or an authorized representative may forward an enforcement order to the attorney general for enforcement. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.86.18(c)(1)(C) to change the time period for filing applications for rehearing to 30 days to be consistent with Water Code, sec.11.316. One commenter suggested that the definition of "monitoring well" in proposed sec.340.2 be amended to expressly exclude monitoring wells used in conjunction with the production of coal and lignite, as is apparently intended by the general exclusion for wells used in conjunction with the production of "other minerals." The commission agrees, and has amended the section accordingly. One commenter noted that proposed sec.340.73 appears to differ from the requirements under discussion at the agency for sec.338.31 and sec.338.32 as to the persons to whom copies of well logs are to be submitted. The commission agrees, and has amended proposed sec.340.73 and sec.340.75 to add local underground water conservation districts and make these sections consistent. The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.10.1. Commission Meetings. (a) The commission shall meet as necessary for the conduct of business including special meetings, at times and places in the state necessary for the performance of the commission's duties. The commission is subject to Texas Water Code, sec.5.058 and the Open Meetings Act, including any existing or future exceptions that may be provided by law. (b) The chairman shall preside at all commission meetings. The chairman may designate another commissioner to preside in his or her absence. sec.10.2. Conduct and Decorum in Commission Meetings. (a) Persons who attend or participate in a meeting should act in a manner that is respectful of the conduct of public business, and conducive to orderly and polite discourse. (b) All persons shall comply with the chairman's directions concerning the offer of public comment, and conduct and decorum. Before the meeting, any person who wishes to speak should complete a public participation form and deliver it to the chief clerk's representative at the meeting. (c) Persons who have special requests concerning a presentation during a meeting shall make advance arrangements with the chief clerk. A special request includes: (1) the presentation of audio or video recordings; (2) the need to move furniture, appliances, or easels; (3) alternative language interpreters; or (4) auxiliary aids or services, such as interpreters for persons who are deaf or hearing impaired, readers, large print, or braille. The chief clerk shall consult with the general counsel on such requests. sec.10.3. Deadline to File Comments on Matter Set for Commission Meeting. The commission or the general counsel may set deadlines for filing written comments on matters set for a commission meeting. The general counsel, either by agreement of the interested persons and any judge assigned to the matter, or on the general counsel's own motion, may extend a filing deadline. sec.10.6. Execution of Orders Showing Action Taken at Commission Meetings. The chairman may sign written orders to show actions taken by the commission at a meeting. In the chairman's absence, another commissioner may sign an order if he or she did not vote against the actions reflected in the orders. sec.10.7. Minutes of Commission Meeting. (a) The chief clerk shall make audio recordings of commission meetings, which shall serve as the minutes. The chief clerk shall keep all recordings in the commission's permanent records. (b) The chief clerk shall not make audio recordings of closed sessions of commission meetings properly held in accordance with the requirements of the Open Meetings Act. Except for a private consultation with an attorney under the Open Meetings Act, sec.551.071, the general counsel or chairman shall keep a certified agenda of each closed session. A certified agenda of a closed session is available for public inspection and copying only under the requirements of Open Meetings Act, sec.551.104(b)(3). sec.10.8. Evidentiary Hearing Held by Commission. When an evidentiary hearing is held before one or more commissioners, Chapter 80 of this title (relating to Contested Case Hearings) shall apply. Judge shall mean the commissioner presiding over the hearing. sec.10.9. Document Filing and Service. All documents to be considered in a commission meeting shall be filed and served according to sec.1. 10 and sec.1.11 of this title (relating to Document Filing Procedures and Service on Judge, Parties, and Interested Parties). This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606775 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 239-1966 Chapter 20. Rulemaking 30 TAC sec.sec.20.1-20.3, 20.5, 20.7, 20.9, 20.11, 20.13, 20.15, 20.17, 20.19 The commission adopts new sec.sec.20.1-20.3, 20.5, 20.7, 20.9, 20.11, 20.13, 20.15, 20.17, and 20.19, concerning procedural rules. Sections 20.17 and 20. 19 are adopted with changes to the proposed text as published in the March 19, 1996, issue of the Texas Register (21 TexReg 2122). Sections 20.1-20.3, 20.5, 20.7, 20.9, 20.11, 20.13, and 20.15 are adopted without changes and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. Comments were received from Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts. Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts generally supported the adoption of the proposed sections with some changes. Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund, while apparently not opposing the adoption of the proposed sections as a whole, generally expressed concerns related to public participation and issues related to delegated federal programs. A number of commenters suggested minor editorial, typographical, and grammatical changes to clarify or shorten the proposed sections. The commission generally agrees with these suggestions, and has amended the proposed sections accordingly. These changes have been made to proposed sec.sec.1.1, 1.5, 1.7, 1.10, 1.11(a), 3.2, 5.3, 5.8, 5.10, 5.11, 5.12, 5.14, 10. 1, 10.2, 10.3, 10.6, 10.8, 20.17, 40.5, 40.6, 40.8, 40.9, 50.13, 50.17, 50.31, 55.21, 55.23, 55.25, 55.27, 55.29, 55.31, 70.2, 70.3, 70.4, 70.5, 70.6, 70.7, 70.8, 70.9(b), 70.10, 70.11, 70.101, 70.102, 70.104, 70.107, 70.108, 70.109, 80.3, 80.11, 80.17, 80.21, 80.23, 80.29, 80.31, 80.33, 80.109, 80.111, 80. 113(c), 80.115, 80.119, 80.127, 80.133, 80.155, 80.201, 80.205, 80.207, 80.209, 80.213, 80.251, 80.253, 80.257, 80.265, 80.267, 80.271, 86.1, 86.11, 86.15, 86.16, 86.34, 86.55, 86.96, 86.98, 86.99, 86.130, 86.131, 86.132, 340.41(b), 340.43(d), 340.45, 340.53(d), 340.71, 340.73, and 340.131. The titles of proposed sec.sec.10.9, 20.19, 40.5, 40.6, 40.8, 50.39(e), 55.31, 70.109, 80.5, 80.23(b), Chapter 50, Subchapter B and Chapter 86, Subchapter D have also been amended for clarity and to reflect their true content. Several commenters commented generally that the proposed sections limit public participation in permit and enforcement actions more stringently than allowed under federal law and do not meet the minimum requirements for federal program approval, basing this comment in part on a draft report prepared by one of the commenters. The commission disagrees. The commenters very narrowly construe the concept of public participation, and the commission does not agree that the statistics contained in the draft report are accurate. The commission does not agree that such a narrow emphasis on contested case evidentiary hearings at the expense of other methods of public participation is either fair or appropriate. The commission also does not agree that the proposed sections impose new limits on public participation. Although the commission's process will be continually reviewed and improved, the process and the proposed sections are consistent with the "United States Environmental Protection Agency's (EPA) Policy Statement of Public Participation," which contains no requirement for contested case hearings on every permitting matter. Public notice is given in compliance with statutory requirements, and when questions or comments from the public are received, the agency's technical staff responds to them. Agency permit engineers and attorneys spend a considerable amount of time answering questions from the public, meeting with them, educating citizens on both the scientific and legal requirements of permits. As questions are raised, staff reconfirms the review and position it is taking on permits. When there is considerable public interest expressed, the agency often will hold one or more public meetings in the local area to encourage give and take between the public, the applicant, and the staff. This is in addition to public meetings that may be required by statute (e.g., Texas Health and Safety Code, sec.361.0791, on hazardous waste management permits). Most importantly, the commenters overlook the provisions of the proposed sections which in fact dramatically increase the opportunity for public participation--now, every motion for reconsideration of an executive director's action goes directly to the commission, and every hearing request is placed on a commission meeting agenda with the right of the requestor to share information and concerns directly with the three commissioners. Most determinations on hearing requests, prior to September 1, 1995, were handled by the Office of Hearing Examiners with little, if any, involvement by the commissioners. The public now has the ability to submit information and concerns to the commissioners, very often has the ability to personally address the commissioners, and the commissioners have the ability to require the applicant and the executive director's staff to respond to those concerns. The exchange takes place in a posted, public hearing. This satisfies the "exchange of views and open exploration of issues, alternatives, and consequences" standard contained in the EPA Policy Statement. Although the commission believes that the proposed sections represent a dramatic improvement, the commission continues to explore ways to enhance this exchange of views. Several commenters suggested that the commission failed to provide notice of the procedural rule changes to the EPA as required. The commission disagrees. The commenters erroneously interpret 42 United States Code, sec.300h- 1(b)(1)(A)(ii) to require notice prior to final adoption of this rule package. Correctly read, the statute only requires notice of a rule change to the EPA after final adoption of an underground injection well program or changes to the program. Upon adoption of this package, the commission will provide appropriate notice to the EPA. One commenter suggested that proposed sec.1.1 be expanded to address both the purpose and scope of the commission's rules. The commission disagrees with this proposal because the language proposed would state what is already law, that the rights of parties and the commission's powers are established by statute and cannot be enlarged by rule, and that the statutes prevail if the commission's rules are in conflict with them. Several commenters criticized the commission's handling of confidential documents under current rules being revised and adopted as proposed sec.1.5. The commission disagrees with these comments because the commission's management of confidential documents complies with all applicable requirements. Another commenter proposed additional language for this section which would specify the duties of the agency's central records office. The commission disagrees, because the proposed directives concerning internal office procedure can be made without adopting the directives as a rule. The commission notes that it has recently directed its executive director to evaluate the agency's record management practices. This evaluation is already under way, and will include the agency's handling of confidential documents to ensure they are not inadvertently disclosed to the public. A request for proposal has been published for a study on the matter. One commenter suggested that proposed sec.1.11 be amended to make it clear what is included in the phrase "courier-receipted delivery service." The commission believes that the phrase is sufficiently clear, and declines to add any definition beyond that already provided in Texas Rule of Civil Procedure 21a. The commission believes that the modifications to proposed sec.1.11 described as follows may also resolve the commenter's concerns. One commenter noted that proposed sec.1.11 and sec.10.10 appear to be missing subsection (e), which appears in old sec.261.18, from which they are derived. The commission agrees. This deletion was inadvertent, since proposed sec.1.11 and sec.10.10 were intended to include the provisions of old sec.261.18. Proposed sec.10.10 duplicates proposed sec.1.11 and has been deleted, and subsection (e) has been added to proposed sec.1.11. In addition, the commission has further clarified proposed sec.1.11 by more closely tracking Texas Rule of Civil Procedure 21a, which the commission believes covers the same subject matter more completely, and has amended and renumbered subsections accordingly. One commenter suggested that proposed sec.3.2 be revised to incorporate several definitions currently contained in other chapters. The commission agrees in part, and has added definitions of "enforcement action" and "enforcement order" to proposed sec.3.2. Other definitions not moved are used only in single chapters, and the commission believes it more useful to leave those definitions in the chapter to which they apply, rather than move them to a general definitions section. The commission intends, however, to continue to consolidate widely used definitions in Chapter 3 for clarity and consistency. One commenter suggested that the definition of "advisory committee" in proposed sec.5.2 be condensed. The commission agrees, and has amended the proposed section accordingly. This commenter also suggested that this definition be moved from proposed sec.5.2 to proposed sec.3.2. Since this term seems to be used only in proposed Chapter 5, the commission disagrees and has left the definition in proposed sec.5.2. One commenter suggested that proposed sec.10.7 be amended to clarify that the commission will keep a certified agenda of closed meetings held in accordance with the requirements of the Texas Open Meetings Act. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.10.9 and sec.10.10 duplicate proposed sec.1.10 and sec.1.11, and suggested that the proposed sections appear only in proposed Chapter 1. The commission agrees, and has deleted proposed sec.10.10 and amended proposed sec.10.9 to change its title and refer to proposed sec.1.10 and sec.1.11. One commenter suggested that proposed Chapter 40 be amended to allow participation in Alternative Dispute Resolution (ADR) by "interested parties" and to allow mediation to occur before a request for hearing is made. While the commission wholeheartedly supports ADR efforts, it disagrees for two reasons, and declines to make the change. First, participation in ADR in contested cases must necessarily be limited to the parties to the case, or at the hearing request stage, to those filing hearing requests as well. Without this limitation, the commission believes it will be difficult for participants to commit to a process where the number and identity of negotiating parties is subject to change. Second, while the commission is strongly committed to ADR, and encourages its use at all stages of the application process, it believes that it is wiser to continue to encourage informal ADR outside of agency rules prior to entry into the contested case process, and leave its use up to the participants, rather than attempt to promulgate rules governing its use at this time. One commenter suggested that the definition of the term "alternative dispute resolution office" in proposed sec.40.2 be replaced with a definition of the term "alternative dispute resolution director" because the latter is used throughout proposed Chapter 40. The commission agrees, has amended the proposed section accordingly, and has also amended proposed sec.40.5(a)(1) accordingly. One commenter suggested deleting the words "regardless of which ADR method is used" from the definition of "mediator" in proposed sec.40.2, as not adding to the definition. The commission disagrees, because it believes that the term "mediator" is used in some circles as a term of art to refer only to a person engaged in specific dispute resolution procedures, and the term is used in these proposed sections in a more inclusive manner. One commenter suggested using the word "applicant" rather than a longer term in the definition of "participant" in proposed sec.40.2, and adding "named parties" to the definition to make clear that they are included in the definition. The commission agrees, and has amended the proposed section accordingly. One commenter suggested deleting the words "from the pool of mediators" from the first sentence of proposed sec.40.4(a) and adding clarifying language regarding private mediators, to make the proposed section more consistent with the other proposed sections of the chapter. The commission agrees, and has amended the proposed section accordingly. One commenter suggested rewording proposed sec.40.4(c) for brevity and clarity. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.40.6 could be read to exclude the possibility of a matter being referred to ADR after a draft permit is proposed and a protest letter received, but prior to the matter being referred to the State Office of Administrative Hearings (SOAH), as proposed sec.55.25(d)(1) anticipates, and suggested amending the proposed section. The commission agrees with the commenter that this can be the most productive period for ADR, expressly desires to encourage ADR at this point, and has amended the proposed section to make it clear that cases may be referred to ADR at this point and that ADR outside of the commission process may be used at any time. Several commenters commented that proposed sec.50.13 and sec.50.33 allow the commission and its executive director to act on an application without considering any comments, and generally maintain that the proposed sections of procedural rules as a whole preclude public comment. The commenters also claim that the provisions of proposed sec.50.33 which prevent action by the executive director where there is a "protest" and the provision for motions for reconsideration are not an adequate substitute for a public comment process. The commission disagrees, and declines to amend the proposed sections. Proposed sec.50.13 and sec.50.33 allow action without a contested case hearing, which is not equivalent to action without considering comments. The procedures contained in the proposed procedural rules sections are, for the most part, in addition to the commission's public comment process, rather than a substitute for them, as the commenters apparently assume, and the equation of participation in a contested case hearing with public comment is inappropriate. The commission actively encourages public participation, and has gone on record repeatedly to express this and to broaden public participation, but believes that the amendments suggested by the commenters go far beyond the scope of this rulemaking. One commenter suggested that proposed sec.50.39 be amended to allow only an "affected person" to file a motion for reconsideration of an executive director's action on an application, suggesting that the term "other person" is too broad. The commission disagrees, and declines to change the proposed section, because the proposed language gives the commission flexibility to reconsider decisions in situations where the error complained of merits attention regardless of who raises it. Additionally, allowing any person to file a motion for reconsideration allows another avenue for public comment by bringing concerns directly to the attention of the commission. The commission believes, however, that the question of whether a person filing a motion for reconsideration is an affected person will in some cases have a bearing on whether the commission acts on the motion. Several commenters criticized proposed sec.55.21(b) and (d), claiming that because of multiple publications, it may be difficult to tell when the deadline for a hearing request occurs. While much of the timing and many of the contents of notices are specifically required by statute, to the extent that this becomes a problem, the commission plans to deal with it in rulemaking on a new proposed chapter governing public notice, rather than in this rulemaking. Several commenters suggested that proposed sec.55.21(c) constitutes an unlawful delegation and allows the person who designs a notice to decide what will be required in a hearing request. The commenters further assert that the proposed section does not adequately plan for errors in the published notice. The commission disagrees, and declines to change the proposed section. The statutes and other sections of the commission's rules dictate the content of public notices, and this proposed section merely requires hearing requests to comply with those requirements, if any. If the notice is defective, this must be generally cured through republication, thus giving another chance to comply with any requirements. Several commenters criticized proposed sec.55.21(e) for not establishing procedures for requesting extensions of time and suggested the inclusion of a "good cause" or public interest test. The commission disagrees. This section is primarily intended to allow the commission to consider late hearing requests. The commission believes that the proposed section allows more flexibility for the commission and the public than the suggestion does, and declines to change the section. One commenter suggested that proposed sec.55.23(b) be revised to require a group or association to provide an explanation of its hearing request with sworn affidavits, written resolutions, or other satisfactory documentation, rather than to allow other parties to request such an explanation. The commission disagrees. While the proposed sections anticipate that a group or association will submit such information, requiring this as an absolute requirement in advance when the group or association's qualifications are not in dispute is burdensome and unnecessary. However, allowing the listed parties to request that evidence, if they believe it to be an issue, protects the integrity of the hearing process and the rights of the applicant while limiting evidence and testimony to those issues that are actually in dispute. Several commenters suggested that proposed sec.55.23(b) and sec.55.26(f) place unreasonable burdens on the public in replying to responses to hearing requests. There is no proposed sec.55.26 and the latter reference is apparently to proposed sec.55.25(f). The commission disagrees, because these proposed sections merely provide a way for the commission and other parties to determine the basis of a hearing request, which is clearly relevant under Texas Water Code, sec.5.115. While the commission does not agree that the proposed time periods are unreasonable, it has determined that the time for replying to responses to hearing requests in proposed sec.55.25(f) should be lengthened from ten days to 14 days to give requestors more time to prepare, and has amended proposed sec.55.25 accordingly. Several commenters suggested that the commission amend proposed sec.sec.55.25, 55.27, 55.29, and 55.31, to change the way the commission deals with hearing requests and with determinations of whether a person is an "affected person," whether a request is "reasonable," and what constitutes "competent evidence" under Texas Water Code, sec.5.115. The commission agrees that these items may need further attention, but, as announced at the beginning of this phase of rulemaking and stated in the preamble to these proposed rules, has reserved this issue for further rulemaking, once sufficient experience has been accumulated with the existing process to fairly evaluate how well the existing rules are working. This project is already underway at the agency, and the commission expects that it will get into full swing shortly after this rulemaking project is concluded. While some minor adjustments to the current process are included in this round of rulemaking, the commission declines to make the suggested major changes in this round of rulemaking. Several commenters suggested that the proposed sections place an unreasonable burden on who can qualify for a hearing and claimed that the commission has not implemented its authority to provide for public participation in hearings. The commission disagrees. As noted previously, the commission believes that the proposed sections broadly encourage public participation. In addition, the proposed sections are entirely consistent with the law on hearings and standing. Finally, the commission is already committed to reviewing this process in another round of rulemaking. Several commenters suggested that proposed sec.55.25(g) be revised to allow a legislator (for an activity in the legislator's district), a state agency, a federal agency, or a local government (for a facility within the local government's jurisdiction) to send an application directly to SOAH for a contested case hearing. The commission disagrees. Nothing in the statutes grants such blanket rights, and the commission believes that adding this provision would violate both the letter and intent of Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115, as well as other specific statutes dealing with contested case hearings, and therefore declines to make this change. One commenter noted that the provisions of proposed sec.55.27 and sec.55.29 do not appear to address instances where the definition of affected persons in the rule (and in Texas Water Code, sec.5.115) may differ from specific statutory provisions defining "affected person" or "person affected," and suggested that the proposed sections be revised to make it clear that specific statutory provisions control. In the alternative, the commenter suggested that the commission apply both the definition of "affected person" in the proposed sections and any specific statutory definition. The commission agrees with the commenter that Texas Water Code, sec.5.115, the proposed sections, and other specific statutes can and should be read together. Generally, Texas Water Code, sec.5.115 will require a "personal justiciable interest," while other specific statutory provisions delineate those interests, specifying distance limitations or identifying specific persons who can request a hearing. The commission believes that the provisions of proposed sec.55.27 (that a hearing request be granted if it is "pursuant to a right to hearing authorized by law") and proposed sec.55.29 (that a relevant factor in determining whether a person has "a personal justiciable interest related to a legal right, duty, privilege, power, or economic interest affected by the application" is "whether the interest claimed is one protected by the law under which the application will be considered") require Texas Water Code, sec.5.115 and any applicable specific statute to be read together. Thus, the commission declines to modify the proposed sections. Several commenters suggested that proposed sec.55.27(b) and (c) be amended on the grounds that they conflict with statutory provisions such as Texas Water Code, Chapter 27, in which counties are granted hearings regardless of a showing of standing or reasonableness of their hearing requests. The commenters also suggested that the test for a state agency or local government needs to be clarified, alleging, for example, that a county is automatically an affected person for an activity in that county. The commission disagrees. No statute, other than those giving party status to the executive director, public interest counsel, Texas Water Development Board, and Texas Parks and Wildlife Department, provides as a blanket rule that a governmental entity is automatically an affected person for all activities in a geographic area, although some do in specific instances. Texas Water Code, sec.27.018, for instance, provides for a hearing on an injection well permit application if one is requested by a "local government." The statute further distinguishes between the terms "local government" and "affected person"--a distinction that does not appear in Texas Water Code, sec.5.115. While there may be some confusion over the use of the term "affected person" in more than one context, the commission believes that it is clear that a hearing request by a local government under Texas Water Code, sec.27.018 meets the tests of reasonableness and being "pursuant to a right to hearing authorized by law" under proposed sec.55.27(b) and "in the public interest" under proposed sec.55.27(c), and that a governmental entity may be an affected person given the definition of "person" contained in proposed sec.3.2 and its "authority under state law" in proposed sec.55.29(b). The commission further believes that the tests for a state agency or local government are sufficiently clear, and therefore declines to amend the proposed sections. Two commenters suggested that the provisions of proposed sec.55.27(c), which allow the commission to refer an application to SOAH for hearing if the commission determines that a hearing would be "in the public interest" even if there is no valid hearing request, be deleted or that the commission delineate standards it will use in making this determination. Several commenters suggested that the provision is vague in that it does not define "public interest." The commission disagrees with these comments and declines to make the suggested changes, in that it believes that there may be situations where the public interest demands a hearing (one example might be information received after the deadline for hearing requests), and also believes that it would be impossible to define "public interest" at this time in terms more specific than those used by the statutes under which the commission operates. One commenter suggested that proposed sec.55.27(c) be deleted as duplicative of proposed sec.55.27(b)(1). The commission disagrees and declines to make the proposed change. Proposed sec.55.27(b)(1) allows a commissioner, an applicant, or the executive director to request a contested case hearing and thereby refer a case to SOAH, while proposed sec.55.27(c) allows the commission as a whole to vote to send a case to SOAH. The two provisions serve different purposes and the commission believes they should be kept separate. Several commenters suggested that the commission's rules on notice need significant changes, and suggested that proposed sec.55.27(c) be amended to prohibit the final notice on a permit from being issued before technical review is complete and a draft decision is available. The commission does not agree that these proposed sections are the place to deal with notice requirements, notes that no notice has been given to the public or interested parties that notice requirements would be changed in these proposed sections, and points out that it is in the process of preparing for publication a new chapter to consolidate many of its notice rules. However, the commission disagrees with the commenters that the existing rules regarding notice are inadequate or restrict public participation. Proposed sec.55.27(c) does not deal with notice, but rather allows the commission to refer an application to SOAH even if there is no hearing request, and the commission does not agree that amending it to deal with notice would be appropriate or advisable. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear whether an administrative law judge can overrule a commission denial of a hearing request based on standing. The commission has amended proposed sec.55.27(f) to make its position on this issue more clear--that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear what must be done to appeal the denial of a hearing request, do not make it clear when the time period for appeal begins to run, and add new burdens by requiring two appeals. The commission does not agree, and declines to further amend the proposed sections beyond the amendments already described. The proposed sections make it clear that a party whose hearing request is denied must seek to obtain party status and then, if unsuccessful, follow procedures for a motion for rehearing as a prerequisite to appeal once the commission has disposed of the application. Since a person who files a hearing request is asking that a contested case hearing be held, that party obtains the relief sought if any hearing request is granted. That person must then seek to be admitted as a party if the person wishes to participate in the case, and decisions on that issue will be handled as they are now, although the commission anticipates that if the person has a complaint at this point, it will be the denial of party status or a limitation of issues rather than a determination on a hearing request. If all hearing requests are denied or withdrawn, persons whose requests are denied have an opportunity for the review of that decision by filing a motion for rehearing after the commission's decision on the application--that is, at the end of the case, rather than in an interlocutory appeal, as the commenters seem to suggest. The commission believes that it is clear in the proposed sections that the time period for appeals begins to run at this point. While the commenters also suggest that it is unreasonable to force parties to go through a hearing and have the result of that hearing reversed by a court based on an error in denying party status, the commission believes that the risk of this kind of result is minimal, is inherent in every determination of party status in any kind of proceeding, and is outweighed by the burden to the public that would be imposed by delaying every permitting decision until determinations of party status are appealed through the court system. Two commenters noted that proposed sec.55.27(f) allows a person whose hearing request is denied to still seek to be admitted as a party, and suggested that absent some compelling reasons, the commission's determination on the hearing request should preclude the later admission of the person as a party. The commission disagrees, and has amended the proposed section as noted previously to make it clear that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. One commenter suggested that proposed sec.55.27 be amended to allow a motion for reconsideration, rather than a motion for rehearing, of the denial of a hearing request, suggesting that the latter is only appropriate in contested cases under the Administrative Procedure Act, and that no contested case arises if a hearing request is not granted. The commission disagrees. As stated previously, the commission believes that a decision on the validity of a hearing request is an interlocutory decision only on the validity of the request, and does not necessarily dictate the outcome of a later decision on party status, or standing. The commission believes that a motion for rehearing at the conclusion of the proceedings is the most appropriate way to review such a decision. Several commenters remarked that the proposed sections do not allow for an adequate record for judicial review when no contested case hearing is held and do not establish standards for a court to use in its review. The commenters also suggest that the proposed sections do not create an adequate record in rulemaking. The commission disagrees, and declines to make changes based on this comment, because it believes that the record created is sufficient for judicial review of the commission's actions, and the standards of review are already clearly established in the statutes and rules. Similarly, the commission believes that the record created in rulemaking proceedings is more than adequate. Several commenters suggested that proposed sec.55.29 and sec.55.31 be revised to provide that the commission accept as true written statements of a person filing a hearing request for the purposes of the determination on the request or the person requesting a hearing be given an opportunity to present evidence to meet the burden of presenting competent evidence under Texas Water Code, sec.5.115. The commission disagrees and declines to make these changes. The first alternative ignores the clear intent of Texas Water Code, sec.5.115, by allowing a person to meet its standards by simply claiming that the standards are met. Texas Water Code, sec.5.115 provides that the commission "is not required to hold a hearing if the commission determines that the basis of the person's hearing request is unreasonable or is not supported by competent evidence." The second alternative does not recognize that this determination will require different procedures in different cases, and the flexibility which the proposed sections provide--from a decision on the pleadings to oral argument to an evidentiary hearing--allows for procedures to be followed which are appropriate for the cases presented. For example, a permit renewal under Texas Health and Safety Code, sec.382.056 may be an example of a case where requests not alleging increases in emissions or compliance problems can be dealt with on the pleadings alone. Similarly, a person who cannot allege a reasonable basis for a hearing request or who cannot allege that competent evidence exists to support the request, despite having more than one opportunity to do so (the request itself, a reply filed under proposed sec.55. 25(f) to responses that point out the merits or deficiencies of the request, and, in appropriate cases, argument or testimony before the commission) is not going to be able to present such evidence at a hearing, and it may be appropriate to resolve this request without an evidentiary hearing. Several commenters suggested that proposed sec.55.31 is unconstitutionally vague and conflicts with other Texas Natural Resource Conservation Commission rules and the law, specifically proposed sec.55.29 and Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115 and that the provisions of proposed sec.55.31(b)(3) are overly burdensome on public participation. The commission disagrees. The commission believes that the proposed section fully complies with the constitution and with Texas Health and Safety Code, sec.382. 056 and Texas Water Code, sec.5.115. The term "reasonableness" is adequately defined by proposed sec.55.31. Further, proposed sec.55.31 does not conflict with proposed sec.55.29, because they deal with different matters--the first with the determination of whether a person is an "affected person," and the second with whether a hearing request is "reasonable." Several commenters suggested that the proposed rules be revised to "provide that the commission will make determinations and record those determinations so that the public can understand the basis for its government's decision and so that a reviewing court can determine if the actions of the commission should be affirmed or reversed." As noted previously, the commission believes that the proposed sections do exactly that and declines to make changes based on this comment. Several commenters suggested that proposed sec.55.33(a)(3) (and presumably proposed sec.80.5(a)(3)) be revised, claiming that the proposed section requires the Chief Clerk to pay the cost for issuing public notices. The commission disagrees, since the proposed section requires the clerk to issue notice and does not provide for the Clerk to pay the cost of notice, since applicants are clearly responsible for those costs. Proposed sec.55.33 has been withdrawn, however, and only proposed sec.80.5 now governs the Chief Clerk's actions in this context. Several commenters noted that the setting procedures of proposed sec.55.33 largely duplicate those of proposed sec.80.5, and suggested the deletion of one or the other. Some commenters suggested conforming these two proposed sections. The commission agrees that these sections are duplicative and should be conformed, and notes as well that proposed sec.70.109 largely duplicates both of these sections. For clarity, the commission believes that it is most logical to lay out all setting procedures only in proposed Chapter 80, and has deleted proposed sec.55.33 and amended proposed sec.70.109 accordingly. Several commenters suggested that the proposed sections of proposed Chapter 70 limit public participation in enforcement proceedings in a fashion that does not meet the federal requirements for such participation and further state that notice in the Texas Register is insufficient. The commission disagrees, and declines to change the proposed sections. The agency complies with federal authorization rules regarding public participation in enforcement matters, which require the agency to have procedures in place for responding to citizen complaints, publish notice of settlements of civil actions, and give assurance that it will not oppose intervention by any citizen when permissive intervention is authorized by statute, rule, or regulation. In regard to the comment that Texas Register publication is insufficient, while the commission disagrees, it is currently considering alternative citizen participation in administrative actions. If rule changes are necessary after a decision is made on this issue, they will be taken up separate from this rulemaking. One commenter suggested that the definitions of "enforcement order," "enforcement action," "petition," and "respondent" be moved from proposed sec.70.2 to proposed sec.3.2. The commission agrees that the definitions of "enforcement action" and "enforcement order" should be moved to sec.3.2 since they are used in general context in other chapters of the agency's rules; however, the terms "petition" and "respondent," as they are defined in proposed Chapter 70, are specific to enforcement actions by the commission only and should remain in proposed Chapter 70. The commission does not believe that generic definitions of petition and respondent are necessary in proposed Chapter 3 to cover permitting matters because those terms are generally accepted legal terminology and "petition" is already included in the definition of "application." One commenter suggested that proposed sec.70.51 substantially changes old sec.337.71 from relating only to water rights enforcement matters to a more general mandatory enforcement hearing process. The commission disagrees. The language in proposed sec.70.51 was taken verbatim from old sec.337.71, except that the title of the subchapter was changed and references to other rules which had been renumbered were changed. The definitions included in old sec.337. 71 included water quality, water rights, hazardous waste releases, and references to the air statute as well. Although the title of old sec.337.71 indicated "Water Rights Enforcement," its statutory basis is Texas Water Code, sec.5.117, which applies to the agency as a whole, and requires the executive director to bring all instances of substantial noncompliance before the commission. The commenter expressed concern that proposed sec.70.51 would require mandatory hearings for incorrect compliance with record keeping requirements in an air permit. Since this would normally not be a substantial noncompliance under the air rules, this section would not apply in that case. Furthermore, old sec.337.71 and proposed sec.70.51 both exclude air violations, since a separate statutory requirement exists for the air program. The program most affected by this statutory requirement is the water quality program, which has a large amount of self-reporting data submitted each month. The proposed section basically sets forth the practice of the watershed management and enforcement divisions in processing this large volume of documents and describes how they determine what constitutes a substantial noncompliance. One commenter suggested that the concept of "executive director preliminary reports" (EDPR), used in proposed sec.70.101, is not necessary in proposed Chapter 70 and is not mandated by statute. While EDPRs are not required by statute, they are clearly allowed and anticipated by statute (see Texas Water Code, sec.sec.13.4151(c) and (d), 26.136(d) and (e), 27.1015(d) and (e), 34. 011(d) and (e) and Texas Health and Safety Code, sec.sec.341.049(c) and (d), 361. 252(d) and (e), 366.0924(d) and (e), 382.088(d) and (f), and 401.384- 401.385). This rulemaking does not alter the provisions in old Chapter 337 regarding preliminary reports, and sets forth the agency's procedures if preliminary reports are chosen as the form of pleading in a case. The executive director is not required to issue a preliminary report, but is given an option which may be used on a case-by-case basis, which is consistent with the statutory provisions. The commission disagrees with the comment and declines to change the proposed section. The commission has determined that the setting procedures of proposed sec.70. 109 largely duplicate those of proposed sec.80.5, and has amended them to simply refer to proposed sec.80.5. The commission has also amended the title of this section for clarity. One commenter suggested that proposed sec.80.3(a) be amended to make it clear that the judge sitting in a phase of a hearing, not the presiding judge, will resolve evidentiary questions raised during that phase of a hearing. The commission generally agrees, but believes that it may be necessary for a judge sitting in one phase of a hearing to refer some important evidentiary questions to the presiding judge, and has amended the section accordingly. Two commenters suggested that proposed sec.80.3(b)(10) be revised to make it clear that the judge may limit the time of presentation of evidence and witnesses without unfairly prejudicing the rights of parties. The commission agrees, and has amended the rule accordingly. In addition, the commission believes that splitting proposed sec.80.3(a) into two subsections and redesignating proposed sec.80.3(b) as sec.80.3(c) makes the proposed rule more readable, and has amended it accordingly. Two commenters suggested that proposed sec.80.5(b) be amended to expressly state that the commission may limit the issues that shall be considered by SOAH in a contested case. The commission agrees that this ability is implicit in Texas Government Code, sec.2003.047(e), and has amended the proposed section accordingly. These commenters also suggest that the proposed section be amended to provide that the commission "may," rather than "shall," identify issues to be addressed. Since Texas Government Code, sec.2003.047(e) uses "shall," the commission disagrees and declines to make this change. The commission has amended proposed sec.80.5(b) to make it clear that the executive director's petition or EDPR serves as the list of issues to be addressed by SOAH in a contested enforcement case. One commenter suggested that proposed sec.55.33(b) (the same as proposed sec.80.5(b)) be deleted, stating that while the commission may want to restrict or direct the list of issues, the proposed section suggests that a referral is not adequate if it does not. The commission disagrees, since Texas Government Code, sec.2003.047(e) clearly mandates an issues list, and since the proposed section gives the commission the flexibility to submit both broad and narrow ranges of issues. Several commenters suggested that proposed sec.80.13 be amended to allow parties, as well as the executive director, to request consolidation of related proceedings. The commission disagrees and declines to change the proposed section, because this is already allowed by the proposed sections. Proposed sec.80.13 allows the executive director to consolidate matters with the permission of the judge, and allows the judge to consolidate matters, presumably on the judge's own motion or that of any party. One commenter noted that due to changes in Chapter 291 of the commission's rules, proposed sec.80.17 does not accurately reflect the burden of proof in certain water and sewer rate cases. The commenter also noted that enforcement cases covered by subsection (c) of the rule should be expressly excepted from subsection (a). The commission agrees, and has amended the proposed section accordingly. One commenter suggested that proposed sec.80.27 be deleted as duplicative of proposed sec.sec.1.08, 1.10, 1.11, and 80.31. While the proposed sections cover similar matters, the commission disagrees and declines to make the change, because proposed sec.80.27 covers mostly matters of form, while the other proposed sections deal with more procedural matters. The commission has amended proposed sec.80.101 to make it clear that the executive director may either act on a matter remanded to the executive director or set it for consideration at a commission meeting. This is allowed by the proposed section, but the amendment lends clarity. One commenter suggested that proposed sec.80.107 is of sufficient importance that it should be dealt with as a separate subchapter. While the commission agrees that the proposed section is important, it prefers as a matter of form at this time not to create additional subchapters, and declines to make the change. One commenter suggested deleting the phrase "administrative law" from a reference in proposed sec.80.107(a)(3) to result in consistent references to the presiding officer as "judge." The commission agrees, and has amended the proposed section accordingly. One commenter suggested amending proposed sec.80.109(b) to define only statutory parties. The commission disagrees, and believes that the proposed section serves a more useful function by referring to all parties to an application, rather than just statutory parties, and declines to make this change. One commenter suggested deleting proposed sec.80.109(c) as duplicative of proposed sec.80.115. The commission agrees, and has amended the proposed section accordingly, renumbering the subsequent subsections. One commenter suggested deleting proposed sec.80.109(d) (now sec.80.109(c)) as duplicative of proposed sec.80.3(b)(5). The commission disagrees, since the section as amended in response to comments on proposed sec.80.115 now makes it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. One commenter suggested moving proposed sec.80.109(e) ((now sec.80.109(d)) to proposed sec.80.119, arguing that it makes more sense to discuss the effects of continuance in that section. The commission disagrees and declines to make the change. Proposed sec.80.109(e) (now sec.80.109(d)) is intended to make it clear that a person designated as a party retains party status regardless of any postponement of a hearing. Since the rule is limited to party status, the commission feels that it makes more sense to leave it in its present location. Several commenters commented that proposed sec.80.111 prohibits the judge and commission from considering comments. The commission disagrees, and points out that the section does not at all impair the executive director's ability to consider comments. The proposed section prohibits the judge from considering protests or comments submitted by non-parties in a non-evidentiary context (not under oath and without the opportunity to cross-examine) as evidence in contested case proceedings. The commission believes this is required by law, and declines to change the proposed section. The commission notes, however, that the phrase "[i]n proceedings other than enforcement proceedings" was inadvertently published as the end of the second sentence of this section, rather than as the beginning of the third sentence. The commission has amended the section accordingly, so that this limitation applies to questions submitted to the judge, not to the consideration of comments. One commenter noted that proposed sec.80.115 is not clear as to whether each and every party has a right to conduct discovery, present a direct case, cross- examine witnesses, obtain copies of pleadings, and so on, even when parties have been aligned under proposed sec.80.109. The commission agrees that the two provisions could be confusing when read together, and has amended proposed sec.80.109(d) to make it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. The commission anticipates that judges will exercise their best judgment when aligning parties and specifying the purposes for which they are aligned. One commenter suggested that proposed sec.80.117(b) be revised to make it clear that all persons granted party status are covered in the order of presentation. The commission agrees, and has amended proposed sec.80.117 by substituting the words "other parties" for the word "protestant." One commenter suggested deleting the word "SOAH" from proposed sec.80.119(d) to make it clear that the section does not restrict the judge in a contested case proceeding to the use solely of SOAH mediators. The commission agrees, and has amended the proposed subsection accordingly. The subsection has also been combined with proposed sec.80.119(c), to make the section shorter and more clear. One commenter suggested combining proposed sec.80.127(a)(2) and (c) to eliminate duplication. The commission agrees, and has amended the proposed section and renumbered subsections accordingly. One commenter suggested that proposed sec.80.127 be revised to more closely track the provisions of Texas Rule of Civil Procedure 267 and Texas Rule of Evidence 613, which prohibit the exclusion from the hearing room when "the rule" is invoked of an officer or employee of a party that is not a natural person and who is designated as its representative by its attorney and a person whose presence is shown by a party to be essential to the presentation of its case. The commission agrees, and has added subsection (f) to the proposed section so that it will more closely track the practice in the courts. One commenter suggested amending proposed sec.80.133 to allow the judge to set a schedule for the submission of written briefs. The commission agrees, and has amended the proposed section accordingly. Two commenters suggested that proposed sec.80.137 be amended to incorporate by reference Texas Rule of Civil Procedure 166a, because of the substantial body of interpretive case law and legal commentary available. The commission agrees that Rule 166a contains valuable guidance, and has tried to track the language of the rule in the proposed section as far as it considers appropriate given the difference between the administrative and judicial processes and the commission's assumption that the most likely use of the proposed section will be to limit issues, rather than to dispose of applications. The commission has accordingly modified the proposed section to track Rule 166a more closely, and anticipates that practitioners and judges will look to Rule 166a and the decisions construing it for guidance. Two commenters suggested that proposed sec.80.137 be amended to change some language relating to testimonial evidence. Because of the amendments noted previously, the commission believes the issue raised by this language to be resolved and declines to make further changes. One commenter suggested that proposed sec.80.151 be amended to expressly refer to Texas Rule of Civil Procedure 215. The commission disagrees, and declines to change the proposed section, because it believes that the grant of authority in Texas Government Code, sec.2003.047 and the sanctions provisions of proposed sec.80.107 already make sufficient provision for sanctions for discovery abuse. One commenter suggested that proposed Subchapter E of Chapter 80 (the "Freeze Rules") be deleted. While the commission recognizes the commenter's concern, it feels that the "freeze rules" have not yet been given a real test in practice, and is inclined to amend, rather than repeal them. The commission has corrected an incorrect reference in proposed sec.80.205 to refer to sec.80.105, rather than sec.80.60. Several commenters suggested that proposed sec.80.203(a)(1) be amended so that it does not require the executive director to prepare a draft permit if the executive director does not recommend the issuance of a permit. The commission disagrees, and declines to make this change, in part because the "freeze rules" were the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome, and in part because the failure to prepare a draft permit would present an almost insuperable barrier to an applicant should the applicant prevail on the issue of whether or not a permit should be issued. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.207(c) be amended to eliminate the additional time proposed beyond the first discovery period for filing a list of issues. The commission disagrees, and declines to make this change. An earlier version of this rule required protestants to have their issues list finished simultaneously with the end of the first discovery period, which the commission believes compresses the work that must be done. The commenter suggested that in the event the additional time remained, additional time should be added to proposed sec.80.207(e) as well. The commission disagrees and declines to make this change, since additional time is already granted by timing the applicant's response from the time the first list of issues is submitted, rather than the close of the first discovery period. Several commenters commented that proposed sec.80.207(d) allows an applicant to disrupt the work required of protestants to comply with subsection proposed sec.80.207(c), and suggested the deletion of the second sentence in subsection (d). The commission disagrees, and declines to make this change. The commenters apparently missed the time extension given in proposed sec.80.207(c), which now allows for completion of the issues list "within 20 days after the end" of the time period originally contained in old sec.265.104, from which the proposed section is derived. The result of the proposed sections is to give the protestant an additional 20 days to complete the issues list, while allowing the applicant to go forward with discovery. The result, rather than an additional burden on the protestant, is an easing of requirements. One commenter suggested that proposed sec.80.207(h) be amended to allow a limited amendment of the application in some circumstances. While the commission agrees that this commenter's point has some merit, the current arrangement was the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.209(c)(3) be amended to require the judge to distribute a prehearing order within four days from the prehearing conference. While the commission recognizes the commenter's concern and the limited (14-day) time period between the prehearing conference and the hearing, it prefers at this time to leave the timing of the prehearing order to the judge, trusting that prehearing orders will be distributed as soon as possible considering the compressed time frame. Two commenters suggested that proposed sec.80.213 be revised to make it clear that paragraph (1)(A) and (B) is not mutually exclusive and that the judge may direct a party to both voluntarily reduce its listed witnesses and provide a summary of the expected testimony of each witness. One commenter also suggested that the language of the rule be made more clear that the judge may prohibit testimony of witnesses. The commission agrees, and has amended the section accordingly. Several commenters suggested that proposed sec.80.259 be revised to eliminate a provision that would allow a judge to file an amended proposal for decision without serving it on the parties. This provision was included in a redline/strikeout version of the proposed rules distributed by agency staff during the rulemaking process, but was dropped from the proposed rule before publication, and thus no revision to the proposed rule is necessary. The staff regrets any inconvenience caused by failing to notify interested persons of the change before publication. The commission has amended proposed sec.80.263 to make it clear that the general counsel may set time limits for oral presentations before the commission. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.sec.80.265, 80.267, and 80.271 to remove the word "final" where it refers to commission decisions or orders, because the use of the word in these proposed sections may be unintentionally confusing when compared with the use of the word in Government Code, sec.sec.2001.141 - 2001.144, dealing with when decisions become final. One commenter suggested that the provision of proposed sec.80.267(b) that the commission will render a decision within 60 days after the date the hearing is finally closed does not give the commission enough time to render its decisions. The commenter suggested lengthening the time period to 90 days. The commission agrees that cases heard by a judge may take more than 60 days, but notes that the 60-day period is mandated by Texas Government Code, sec.2001. 143 unless extended. The commission believes, however, that proposed sec.80. 267(b) gives the judge enough flexibility to extend the time, and therefore declines to make the suggested revision. The commission has amended proposed sec.80.277 to more clearly reflect the commission's position and longstanding agency practice that the executive director or an authorized representative may forward an enforcement order to the attorney general for enforcement. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.86.18(c)(1)(C) to change the time period for filing applications for rehearing to 30 days to be consistent with Water Code, sec.11.316. One commenter suggested that the definition of "monitoring well" in proposed sec.340.2 be amended to expressly exclude monitoring wells used in conjunction with the production of coal and lignite, as is apparently intended by the general exclusion for wells used in conjunction with the production of "other minerals." The commission agrees, and has amended the section accordingly. One commenter noted that proposed sec.340.73 appears to differ from the requirements under discussion at the agency for sec.338.31 and sec.338.32 as to the persons to whom copies of well logs are to be submitted. The commission agrees, and has amended proposed sec.340.73 and sec.340.75 to add local underground water conservation districts and make these sections consistent. The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.20.17. Emergency Rules. If the commission finds that an imminent peril or extraordinary circumstance may threaten the public health, safety, or welfare or the integrity of the commission's regulatory programs, and requires the adoption of a rule on less than 30 day's notice, it may adopt an emergency rule without prior notice and hearing or with any abbreviated notice and hearing that it finds practicable under the circumstances. The commission shall make a written finding which shall be filed with the secretary of state setting forth its reasons for such determination. The emergency rule shall be effective immediately upon filing with the secretary of state and will continue in effect for a period of up to 120 days. The emergency rule may be renewed once before expiration for a period of 60 days. sec.20.19. Working Groups. Before initiating any formal rulemaking action, the commission may convene informal working groups to obtain interested persons. The commission groups of experts or interested persons or representatives of the general public to advise it regarding any contemplated rulemaking. The powers of such working groups shall be advisory only. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606777 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Chapter 40. Alternative Dispute Resolution Procedure 30 TAC sec.sec.40.1-40.9 The commission adopts new sec.sec.40.1-40.9, concerning procedural rules. Sections 40.2, 40.4-40.6, 40.8, and 40.9 are adopted with changes to the proposed text as published in the March 19, 1996, issue of the Texas Register (21 TexReg 2125). Sections 40.1, 40.3, and 40.7 are adopted without changes and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. Comments were received from Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts. Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts generally supported the adoption of the proposed sections with some changes. Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund, while apparently not opposing the adoption of the proposed sections as a whole, generally expressed concerns related to public participation and issues related to delegated federal programs. A number of commenters suggested minor editorial, typographical, and grammatical changes to clarify or shorten the proposed sections. The commission generally agrees with these suggestions, and has amended the proposed sections accordingly. These changes have been made to proposed sec.sec.1.1, 1.5, 1.7, 1.10, 1.11(a), 3.2, 5.3, 5.8, 5.10, 5.11, 5.12, 5.14, 10. 1, 10.2, 10.3, 10.6, 10.8, 20.17, 40.5, 40.6, 40.8, 40.9, 50.13, 50.17, 50.31, 55.21, 55.23, 55.25, 55.27, 55.29, 55.31, 70.2, 70.3, 70.4, 70.5, 70.6, 70.7, 70.8, 70.9(b), 70.10, 70.11, 70.101, 70.102, 70.104, 70.107, 70.108, 70.109, 80.3, 80.11, 80.17, 80.21, 80.23, 80.29, 80.31, 80.33, 80.109, 80.111, 80. 113(c), 80.115, 80.119, 80.127, 80.133, 80.155, 80.201, 80.205, 80.207, 80.209, 80.213, 80.251, 80.253, 80.257, 80.265, 80.267, 80.271, 86.1, 86.11, 86.15, 86.16, 86.34, 86.55, 86.96, 86.98, 86.99, 86.130, 86.131, 86.132, 340.41(b), 340.43(d), 340.45, 340.53(d), 340.71, 340.73, and 340.131. The titles of proposed sec.sec.10.9, 20.19, 40.5, 40.6, 40.8, 50.39(e), 55.31, 70.109, 80.5, 80.23(b), Chapter 50, Subchapter B and Chapter 86, Subchapter D have also been amended for clarity and to reflect their true content. Several commenters commented generally that the proposed sections limit public participation in permit and enforcement actions more stringently than allowed under federal law and do not meet the minimum requirements for federal program approval, basing this comment in part on a draft report prepared by one of the commenters. The commission disagrees. The commenters very narrowly construe the concept of public participation, and the commission does not agree that the statistics contained in the draft report are accurate. The commission does not agree that such a narrow emphasis on contested case evidentiary hearings at the expense of other methods of public participation is either fair or appropriate. The commission also does not agree that the proposed sections impose new limits on public participation. Although the commission's process will be continually reviewed and improved, the process and the proposed sections are consistent with the "United States Environmental Protection Agency's (EPA) Policy Statement of Public Participation," which contains no requirement for contested case hearings on every permitting matter. Public notice is given in compliance with statutory requirements, and when questions or comments from the public are received, the agency's technical staff responds to them. Agency permit engineers and attorneys spend a considerable amount of time answering questions from the public, meeting with them, educating citizens on both the scientific and legal requirements of permits. As questions are raised, staff reconfirms the review and position it is taking on permits. When there is considerable public interest expressed, the agency often will hold one or more public meetings in the local area to encourage give and take between the public, the applicant, and the staff. This is in addition to public meetings that may be required by statute (e.g., Texas Health and Safety Code, sec.361.0791, on hazardous waste management permits). Most importantly, the commenters overlook the provisions of the proposed sections which in fact dramatically increase the opportunity for public participation-now, every motion for reconsideration of an executive director's action goes directly to the commission, and every hearing request is placed on a commission meeting agenda with the right of the requestor to share information and concerns directly with the three commissioners. Most determinations on hearing requests, prior to September 1, 1995, were handled by the Office of Hearing Examiners with little, if any, involvement by the commissioners. The public now has the ability to submit information and concerns to the commissioners, very often has the ability to personally address the commissioners, and the commissioners have the ability to require the applicant and the executive director's staff to respond to those concerns. The exchange takes place in a posted, public hearing. This satisfies the "exchange of views and open exploration of issues, alternatives, and consequences" standard contained in the EPA Policy Statement. Although the commission believes that the proposed sections represent a dramatic improvement, the commission continues to explore ways to enhance this exchange of views. Several commenters suggested that the commission failed to provide notice of the procedural rule changes to the EPA as required. The commission disagrees. The commenters erroneously interpret 42 United States Code, sec.300h- 1(b)(1)(A)(ii) to require notice prior to final adoption of this rule package. Correctly read, the statute only requires notice of a rule change to the EPA after final adoption of an underground injection well program or changes to the program. Upon adoption of this package, the commission will provide appropriate notice to the EPA. One commenter suggested that proposed sec.1.1 be expanded to address both the purpose and scope of the commission's rules. The commission disagrees with this proposal because the language proposed would state what is already law, that the rights of parties and the commission's powers are established by statute and cannot be enlarged by rule, and that the statutes prevail if the commission's rules are in conflict with them. Several commenters criticized the commission's handling of confidential documents under current rules being revised and adopted as proposed sec.1.5. The commission disagrees with these comments because the commission's management of confidential documents complies with all applicable requirements. Another commenter proposed additional language for this section which would specify the duties of the agency's central records office. The commission disagrees, because the proposed directives concerning internal office procedure can be made without adopting the directives as a rule. The commission notes that it has recently directed its executive director to evaluate the agency's record management practices. This evaluation is already under way, and will include the agency's handling of confidential documents to ensure they are not inadvertently disclosed to the public. A request for proposal has been published for a study on the matter. One commenter suggested that proposed sec.1.11 be amended to make it clear what is included in the phrase "courier-receipted delivery service." The commission believes that the phrase is sufficiently clear, and declines to add any definition beyond that already provided in Texas Rule of Civil Procedure 21a. The commission believes that the modifications to proposed sec.1.11 described as follows may also resolve the commenter's concerns. One commenter noted that proposed sec.1.11 and sec.10.10 appear to be missing subsection (e), which appears in old sec.261.18, from which they are derived. The commission agrees. This deletion was inadvertent, since proposed sec.1.11 and sec.10.10 were intended to include the provisions of old sec.261.18. Proposed sec.10.10 duplicates proposed sec.1.11 and has been deleted, and subsection (e) has been added to proposed sec.1.11. In addition, the commission has further clarified proposed sec.1.11 by more closely tracking Texas Rule of Civil Procedure 21a, which the commission believes covers the same subject matter more completely, and has amended and renumbered subsections accordingly. One commenter suggested that proposed sec.3.2 be revised to incorporate several definitions currently contained in other chapters. The commission agrees in part, and has added definitions of "enforcement action" and "enforcement order" to proposed sec.3.2. Other definitions not moved are used only in single chapters, and the commission believes it more useful to leave those definitions in the chapter to which they apply, rather than move them to a general definitions section. The commission intends, however, to continue to consolidate widely used definitions in Chapter 3 for clarity and consistency. One commenter suggested that the definition of "advisory committee" in proposed sec.5.2 be condensed. The commission agrees, and has amended the proposed section accordingly. This commenter also suggested that this definition be moved from proposed sec.5.2 to proposed sec.3.2. Since this term seems to be used only in proposed Chapter 5, the commission disagrees and has left the definition in proposed sec.5.2. One commenter suggested that proposed sec.10.7 be amended to clarify that the commission will keep a certified agenda of closed meetings held in accordance with the requirements of the Texas Open Meetings Act. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.10.9 and sec.10.10 duplicate proposed sec.1.10 and sec.1.11, and suggested that the proposed sections appear only in proposed Chapter 1. The commission agrees, and has deleted proposed sec.10.10 and amended proposed sec.10.9 to change its title and refer to proposed sec.1.10 and sec.1.11. One commenter suggested that proposed Chapter 40 be amended to allow participation in Alternative Dispute Resolution (ADR) by "interested parties" and to allow mediation to occur before a request for hearing is made. While the commission wholeheartedly supports ADR efforts, it disagrees for two reasons, and declines to make the change. First, participation in ADR in contested cases must necessarily be limited to the parties to the case, or at the hearing request stage, to those filing hearing requests as well. Without this limitation, the commission believes it will be difficult for participants to commit to a process where the number and identity of negotiating parties is subject to change. Second, while the commission is strongly committed to ADR, and encourages its use at all stages of the application process, it believes that it is wiser to continue to encourage informal ADR outside of agency rules prior to entry into the contested case process, and leave its use up to the participants, rather than attempt to promulgate rules governing its use at this time. One commenter suggested that the definition of the term "alternative dispute resolution office" in proposed sec.40.2 be replaced with a definition of the term "alternative dispute resolution director" because the latter is used throughout proposed Chapter 40. The commission agrees, has amended the proposed section accordingly, and has also amended proposed sec.40.5(a)(1) accordingly. One commenter suggested deleting the words "regardless of which ADR method is used" from the definition of "mediator" in proposed sec.40.2, as not adding to the definition. The commission disagrees, because it believes that the term "mediator" is used in some circles as a term of art to refer only to a person engaged in specific dispute resolution procedures, and the term is used in these proposed sections in a more inclusive manner. One commenter suggested using the word "applicant" rather than a longer term in the definition of "participant" in proposed sec.40.2, and adding "named parties" to the definition to make clear that they are included in the definition. The commission agrees, and has amended the proposed section accordingly. One commenter suggested deleting the words "from the pool of mediators" from the first sentence of proposed sec.40.4(a) and adding clarifying language regarding private mediators, to make the proposed section more consistent with the other proposed sections of the chapter. The commission agrees, and has amended the proposed section accordingly. One commenter suggested rewording proposed sec.40.4(c) for brevity and clarity. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.40.6 could be read to exclude the possibility of a matter being referred to ADR after a draft permit is proposed and a protest letter received, but prior to the matter being referred to the State Office of Administrative Hearings (SOAH), as proposed sec.55.25(d)(1) anticipates, and suggested amending the proposed section. The commission agrees with the commenter that this can be the most productive period for ADR, expressly desires to encourage ADR at this point, and has amended the proposed section to make it clear that cases may be referred to ADR at this point and that ADR outside of the commission process may be used at any time. Several commenters commented that proposed sec.50.13 and sec.50.33 allow the commission and its executive director to act on an application without considering any comments, and generally maintain that the proposed sections of procedural rules as a whole preclude public comment. The commenters also claim that the provisions of proposed sec.50.33 which prevent action by the executive director where there is a "protest" and the provision for motions for reconsideration are not an adequate substitute for a public comment process. The commission disagrees, and declines to amend the proposed sections. Proposed sec.50.13 and sec.50.33 allow action without a contested case hearing, which is not equivalent to action without considering comments. The procedures contained in the proposed procedural rules sections are, for the most part, in addition to the commission's public comment process, rather than a substitute for them, as the commenters apparently assume, and the equation of participation in a contested case hearing with public comment is inappropriate. The commission actively encourages public participation, and has gone on record repeatedly to express this and to broaden public participation, but believes that the amendments suggested by the commenters go far beyond the scope of this rulemaking. One commenter suggested that proposed sec.50.39 be amended to allow only an "affected person" to file a motion for reconsideration of an executive director's action on an application, suggesting that the term "other person" is too broad. The commission disagrees, and declines to change the proposed section, because the proposed language gives the commission flexibility to reconsider decisions in situations where the error complained of merits attention regardless of who raises it. Additionally, allowing any person to file a motion for reconsideration allows another avenue for public comment by bringing concerns directly to the attention of the commission. The commission believes, however, that the question of whether a person filing a motion for reconsideration is an affected person will in some cases have a bearing on whether the commission acts on the motion. Several commenters criticized proposed sec.55.21(b) and (d), claiming that because of multiple publications, it may be difficult to tell when the deadline for a hearing request occurs. While much of the timing and many of the contents of notices are specifically required by statute, to the extent that this becomes a problem, the commission plans to deal with it in rulemaking on a new proposed chapter governing public notice, rather than in this rulemaking. Several commenters suggested that proposed sec.55.21(c) constitutes an unlawful delegation and allows the person who designs a notice to decide what will be required in a hearing request. The commenters further assert that the proposed section does not adequately plan for errors in the published notice. The commission disagrees, and declines to change the proposed section. The statutes and other sections of the commission's rules dictate the content of public notices, and this proposed section merely requires hearing requests to comply with those requirements, if any. If the notice is defective, this must be generally cured through republication, thus giving another chance to comply with any requirements. Several commenters criticized proposed sec.55.21(e) for not establishing procedures for requesting extensions of time and suggested the inclusion of a "good cause" or public interest test. The commission disagrees. This section is primarily intended to allow the commission to consider late hearing requests. The commission believes that the proposed section allows more flexibility for the commission and the public than the suggestion does, and declines to change the section. One commenter suggested that proposed sec.55.23(b) be revised to require a group or association to provide an explanation of its hearing request with sworn affidavits, written resolutions, or other satisfactory documentation, rather than to allow other parties to request such an explanation. The commission disagrees. While the proposed sections anticipate that a group or association will submit such information, requiring this as an absolute requirement in advance when the group or association's qualifications are not in dispute is burdensome and unnecessary. However, allowing the listed parties to request that evidence, if they believe it to be an issue, protects the integrity of the hearing process and the rights of the applicant while limiting evidence and testimony to those issues that are actually in dispute. Several commenters suggested that proposed sec.55.23(b) and sec.55.26(f) place unreasonable burdens on the public in replying to responses to hearing requests. There is no proposed sec.55.26 and the latter reference is apparently to proposed sec.55.25(f). The commission disagrees, because these proposed sections merely provide a way for the commission and other parties to determine the basis of a hearing request, which is clearly relevant under Texas Water Code, sec.5.115. While the commission does not agree that the proposed time periods are unreasonable, it has determined that the time for replying to responses to hearing requests in proposed sec.55.25(f) should be lengthened from ten days to 14 days to give requestors more time to prepare, and has amended proposed sec.55.25 accordingly. Several commenters suggested that the commission amend proposed sec.sec.55.25, 55.27, 55.29, and 55.31, to change the way the commission deals with hearing requests and with determinations of whether a person is an "affected person," whether a request is "reasonable," and what constitutes "competent evidence" under Texas Water Code, sec.5.115. The commission agrees that these items may need further attention, but, as announced at the beginning of this phase of rulemaking and stated in the preamble to these proposed rules, has reserved this issue for further rulemaking, once sufficient experience has been accumulated with the existing process to fairly evaluate how well the existing rules are working. This project is already underway at the agency, and the commission expects that it will get into full swing shortly after this rulemaking project is concluded. While some minor adjustments to the current process are included in this round of rulemaking, the commission declines to make the suggested major changes in this round of rulemaking. Several commenters suggested that the proposed sections place an unreasonable burden on who can qualify for a hearing and claimed that the commission has not implemented its authority to provide for public participation in hearings. The commission disagrees. As noted previously, the commission believes that the proposed sections broadly encourage public participation. In addition, the proposed sections are entirely consistent with the law on hearings and standing. Finally, the commission is already committed to reviewing this process in another round of rulemaking. Several commenters suggested that proposed sec.55.25(g) be revised to allow a legislator (for an activity in the legislator's district), a state agency, a federal agency, or a local government (for a facility within the local government's jurisdiction) to send an application directly to SOAH for a contested case hearing. The commission disagrees. Nothing in the statutes grants such blanket rights, and the commission believes that adding this provision would violate both the letter and intent of Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115, as well as other specific statutes dealing with contested case hearings, and therefore declines to make this change. One commenter noted that the provisions of proposed sec.55.27 and sec.55.29 do not appear to address instances where the definition of affected persons in the rule (and in Texas Water Code, sec.5.115) may differ from specific statutory provisions defining "affected person" or "person affected," and suggested that the proposed sections be revised to make it clear that specific statutory provisions control. In the alternative, the commenter suggested that the commission apply both the definition of "affected person" in the proposed sections and any specific statutory definition. The commission agrees with the commenter that Texas Water Code, sec.5.115, the proposed sections, and other specific statutes can and should be read together. Generally, Texas Water Code, sec.5.115 will require a "personal justiciable interest," while other specific statutory provisions delineate those interests, specifying distance limitations or identifying specific persons who can request a hearing. The commission believes that the provisions of proposed sec.55.27 (that a hearing request be granted if it is "pursuant to a right to hearing authorized by law") and proposed sec.55.29 (that a relevant factor in determining whether a person has "a personal justiciable interest related to a legal right, duty, privilege, power, or economic interest affected by the application" is "whether the interest claimed is one protected by the law under which the application will be considered") require Texas Water Code, sec.5.115 and any applicable specific statute to be read together. Thus, the commission declines to modify the proposed sections. Several commenters suggested that proposed sec.55.27(b) and (c) be amended on the grounds that they conflict with statutory provisions such as Texas Water Code, Chapter 27, in which counties are granted hearings regardless of a showing of standing or reasonableness of their hearing requests. The commenters also suggested that the test for a state agency or local government needs to be clarified, alleging, for example, that a county is automatically an affected person for an activity in that county. The commission disagrees. No statute, other than those giving party status to the executive director, public interest counsel, Texas Water Development Board, and Texas Parks and Wildlife Department, provides as a blanket rule that a governmental entity is automatically an affected person for all activities in a geographic area, although some do in specific instances. Texas Water Code, sec.27.018, for instance, provides for a hearing on an injection well permit application if one is requested by a "local government." The statute further distinguishes between the terms "local government" and "affected person"-a distinction that does not appear in Texas Water Code, sec.5.115. While there may be some confusion over the use of the term "affected person" in more than one context, the commission believes that it is clear that a hearing request by a local government under Texas Water Code, sec.27.018 meets the tests of reasonableness and being "pursuant to a right to hearing authorized by law" under proposed sec.55.27(b) and "in the public interest" under proposed sec.55.27(c), and that a governmental entity may be an affected person given the definition of "person" contained in proposed sec.3.2 and its "authority under state law" in proposed sec.55.29(b). The commission further believes that the tests for a state agency or local government are sufficiently clear, and therefore declines to amend the proposed sections. Two commenters suggested that the provisions of proposed sec.55.27(c), which allow the commission to refer an application to SOAH for hearing if the commission determines that a hearing would be "in the public interest" even if there is no valid hearing request, be deleted or that the commission delineate standards it will use in making this determination. Several commenters suggested that the provision is vague in that it does not define "public interest." The commission disagrees with these comments and declines to make the suggested changes, in that it believes that there may be situations where the public interest demands a hearing (one example might be information received after the deadline for hearing requests), and also believes that it would be impossible to define "public interest" at this time in terms more specific than those used by the statutes under which the commission operates. One commenter suggested that proposed sec.55.27(c) be deleted as duplicative of proposed sec.55.27(b)(1). The commission disagrees and declines to make the proposed change. Proposed sec.55.27(b)(1) allows a commissioner, an applicant, or the executive director to request a contested case hearing and thereby refer a case to SOAH, while proposed sec.55.27(c) allows the commission as a whole to vote to send a case to SOAH. The two provisions serve different purposes and the commission believes they should be kept separate. Several commenters suggested that the commission's rules on notice need significant changes, and suggested that proposed sec.55.27(c) be amended to prohibit the final notice on a permit from being issued before technical review is complete and a draft decision is available. The commission does not agree that these proposed sections are the place to deal with notice requirements, notes that no notice has been given to the public or interested parties that notice requirements would be changed in these proposed sections, and points out that it is in the process of preparing for publication a new chapter to consolidate many of its notice rules. However, the commission disagrees with the commenters that the existing rules regarding notice are inadequate or restrict public participation. Proposed sec.55.27(c) does not deal with notice, but rather allows the commission to refer an application to SOAH even if there is no hearing request, and the commission does not agree that amending it to deal with notice would be appropriate or advisable. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear whether an administrative law judge can overrule a commission denial of a hearing request based on standing. The commission has amended proposed sec.55.27(f) to make its position on this issue more clear-that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear what must be done to appeal the denial of a hearing request, do not make it clear when the time period for appeal begins to run, and add new burdens by requiring two appeals. The commission does not agree, and declines to further amend the proposed sections beyond the amendments already described. The proposed sections make it clear that a party whose hearing request is denied must seek to obtain party status and then, if unsuccessful, follow procedures for a motion for rehearing as a prerequisite to appeal once the commission has disposed of the application. Since a person who files a hearing request is asking that a contested case hearing be held, that party obtains the relief sought if any hearing request is granted. That person must then seek to be admitted as a party if the person wishes to participate in the case, and decisions on that issue will be handled as they are now, although the commission anticipates that if the person has a complaint at this point, it will be the denial of party status or a limitation of issues rather than a determination on a hearing request. If all hearing requests are denied or withdrawn, persons whose requests are denied have an opportunity for the review of that decision by filing a motion for rehearing after the commission's decision on the application -that is, at the end of the case, rather than in an interlocutory appeal, as the commenters seem to suggest. The commission believes that it is clear in the proposed sections that the time period for appeals begins to run at this point. While the commenters also suggest that it is unreasonable to force parties to go through a hearing and have the result of that hearing reversed by a court based on an error in denying party status, the commission believes that the risk of this kind of result is minimal, is inherent in every determination of party status in any kind of proceeding, and is outweighed by the burden to the public that would be imposed by delaying every permitting decision until determinations of party status are appealed through the court system. Two commenters noted that proposed sec.55.27(f) allows a person whose hearing request is denied to still seek to be admitted as a party, and suggested that absent some compelling reasons, the commission's determination on the hearing request should preclude the later admission of the person as a party. The commission disagrees, and has amended the proposed section as noted previously to make it clear that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. One commenter suggested that proposed sec.55.27 be amended to allow a motion for reconsideration, rather than a motion for rehearing, of the denial of a hearing request, suggesting that the latter is only appropriate in contested cases under the Administrative Procedure Act, and that no contested case arises if a hearing request is not granted. The commission disagrees. As stated previously, the commission believes that a decision on the validity of a hearing request is an interlocutory decision only on the validity of the request, and does not necessarily dictate the outcome of a later decision on party status, or standing. The commission believes that a motion for rehearing at the conclusion of the proceedings is the most appropriate way to review such a decision. Several commenters remarked that the proposed sections do not allow for an adequate record for judicial review when no contested case hearing is held and do not establish standards for a court to use in its review. The commenters also suggest that the proposed sections do not create an adequate record in rulemaking. The commission disagrees, and declines to make changes based on this comment, because it believes that the record created is sufficient for judicial review of the commission's actions, and the standards of review are already clearly established in the statutes and rules. Similarly, the commission believes that the record created in rulemaking proceedings is more than adequate. Several commenters suggested that proposed sec.55.29 and sec.55.31 be revised to provide that the commission accept as true written statements of a person filing a hearing request for the purposes of the determination on the request or the person requesting a hearing be given an opportunity to present evidence to meet the burden of presenting competent evidence under Texas Water Code, sec.5.115. The commission disagrees and declines to make these changes. The first alternative ignores the clear intent of Texas Water Code, sec.5.115, by allowing a person to meet its standards by simply claiming that the standards are met. Texas Water Code, sec.5.115 provides that the commission "is not required to hold a hearing if the commission determines that the basis of the person's hearing request is unreasonable or is not supported by competent evidence." The second alternative does not recognize that this determination will require different procedures in different cases, and the flexibility which the proposed sections provide-from a decision on the pleadings to oral argument to an evidentiary hearing-allows for procedures to be followed which are appropriate for the cases presented. For example, a permit renewal under Texas Health and Safety Code, sec.382.056 may be an example of a case where requests not alleging increases in emissions or compliance problems can be dealt with on the pleadings alone. Similarly, a person who cannot allege a reasonable basis for a hearing request or who cannot allege that competent evidence exists to support the request, despite having more than one opportunity to do so (the request itself, a reply filed under proposed sec.55. 25(f) to responses that point out the merits or deficiencies of the request, and, in appropriate cases, argument or testimony before the commission) is not going to be able to present such evidence at a hearing, and it may be appropriate to resolve this request without an evidentiary hearing. Several commenters suggested that proposed sec.55.31 is unconstitutionally vague and conflicts with other Texas Natural Resource Conservation Commission rules and the law, specifically proposed sec.55.29 and Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115 and that the provisions of proposed sec.55.31(b)(3) are overly burdensome on public participation. The commission disagrees. The commission believes that the proposed section fully complies with the constitution and with Texas Health and Safety Code, sec.382. 056 and Texas Water Code, sec.5.115. The term "reasonableness" is adequately defined by proposed sec.55.31. Further, proposed sec.55.31 does not conflict with proposed sec.55.29, because they deal with different matters -the first with the determination of whether a person is an "affected person," and the second with whether a hearing request is "reasonable." Several commenters suggested that the proposed rules be revised to "provide that the commission will make determinations and record those determinations so that the public can understand the basis for its government's decision and so that a reviewing court can determine if the actions of the commission should be affirmed or reversed." As noted previously, the commission believes that the proposed sections do exactly that and declines to make changes based on this comment. Several commenters suggested that proposed sec.55.33(a)(3) (and presumably proposed sec.80.5(a)(3)) be revised, claiming that the proposed section requires the Chief Clerk to pay the cost for issuing public notices. The commission disagrees, since the proposed section requires the clerk to issue notice and does not provide for the Clerk to pay the cost of notice, since applicants are clearly responsible for those costs. Proposed sec.55.33 has been withdrawn, however, and only proposed sec.80.5 now governs the Chief Clerk's actions in this context. Several commenters noted that the setting procedures of proposed sec.55.33 largely duplicate those of proposed sec.80.5, and suggested the deletion of one or the other. Some commenters suggested conforming these two proposed sections. The commission agrees that these sections are duplicative and should be conformed, and notes as well that proposed sec.70.109 largely duplicates both of these sections. For clarity, the commission believes that it is most logical to lay out all setting procedures only in proposed Chapter 80, and has deleted proposed sec.55.33 and amended proposed sec.70.109 accordingly. Several commenters suggested that the proposed sections of proposed Chapter 70 limit public participation in enforcement proceedings in a fashion that does not meet the federal requirements for such participation and further state that notice in the Texas Register is insufficient. The commission disagrees, and declines to change the proposed sections. The agency complies with federal authorization rules regarding public participation in enforcement matters, which require the agency to have procedures in place for responding to citizen complaints, publish notice of settlements of civil actions, and give assurance that it will not oppose intervention by any citizen when permissive intervention is authorized by statute, rule, or regulation. In regard to the comment that Texas Register publication is insufficient, while the commission disagrees, it is currently considering alternative citizen participation in administrative actions. If rule changes are necessary after a decision is made on this issue, they will be taken up separate from this rulemaking. One commenter suggested that the definitions of "enforcement order," "enforcement action," "petition," and "respondent" be moved from proposed sec.70.2 to proposed sec.3.2. The commission agrees that the definitions of "enforcement action" and "enforcement order" should be moved to sec.3.2 since they are used in general context in other chapters of the agency's rules; however, the terms "petition" and "respondent," as they are defined in proposed Chapter 70, are specific to enforcement actions by the commission only and should remain in proposed Chapter 70. The commission does not believe that generic definitions of petition and respondent are necessary in proposed Chapter 3 to cover permitting matters because those terms are generally accepted legal terminology and "petition" is already included in the definition of "application." One commenter suggested that proposed sec.70.51 substantially changes old sec.337.71 from relating only to water rights enforcement matters to a more general mandatory enforcement hearing process. The commission disagrees. The language in proposed sec.70.51 was taken verbatim from old sec.337.71, except that the title of the subchapter was changed and references to other rules which had been renumbered were changed. The definitions included in old sec.337. 71 included water quality, water rights, hazardous waste releases, and references to the air statute as well. Although the title of old sec.337.71 indicated "Water Rights Enforcement," its statutory basis is Texas Water Code, sec.5.117, which applies to the agency as a whole, and requires the executive director to bring all instances of substantial noncompliance before the commission. The commenter expressed concern that proposed sec.70.51 would require mandatory hearings for incorrect compliance with record keeping requirements in an air permit. Since this would normally not be a substantial noncompliance under the air rules, this section would not apply in that case. Furthermore, old sec.337.71 and proposed sec.70.51 both exclude air violations, since a separate statutory requirement exists for the air program. The program most affected by this statutory requirement is the water quality program, which has a large amount of self-reporting data submitted each month. The proposed section basically sets forth the practice of the watershed management and enforcement divisions in processing this large volume of documents and describes how they determine what constitutes a substantial noncompliance. One commenter suggested that the concept of "executive director preliminary reports" (EDPR), used in proposed sec.70.101, is not necessary in proposed Chapter 70 and is not mandated by statute. While EDPRs are not required by statute, they are clearly allowed and anticipated by statute (see Texas Water Code, sec.sec.13.4151(c) and (d), 26.136(d) and (e), 27.1015(d) and (e), 34. 011(d) and (e) and Texas Health and Safety Code, sec.sec.341.049(c) and (d), 361. 252(d) and (e), 366.0924(d) and (e), 382.088(d) and (f), and 401.384- 401.385). This rulemaking does not alter the provisions in old Chapter 337 regarding preliminary reports, and sets forth the agency's procedures if preliminary reports are chosen as the form of pleading in a case. The executive director is not required to issue a preliminary report, but is given an option which may be used on a case-by-case basis, which is consistent with the statutory provisions. The commission disagrees with the comment and declines to change the proposed section. The commission has determined that the setting procedures of proposed sec.70. 109 largely duplicate those of proposed sec.80.5, and has amended them to simply refer to proposed sec.80.5. The commission has also amended the title of this section for clarity. One commenter suggested that proposed sec.80.3(a) be amended to make it clear that the judge sitting in a phase of a hearing, not the presiding judge, will resolve evidentiary questions raised during that phase of a hearing. The commission generally agrees, but believes that it may be necessary for a judge sitting in one phase of a hearing to refer some important evidentiary questions to the presiding judge, and has amended the section accordingly. Two commenters suggested that proposed sec.80.3(b)(10) be revised to make it clear that the judge may limit the time of presentation of evidence and witnesses without unfairly prejudicing the rights of parties. The commission agrees, and has amended the rule accordingly. In addition, the commission believes that splitting proposed sec.80.3(a) into two subsections and redesignating proposed sec.80.3(b) as sec.80.3(c) makes the proposed rule more readable, and has amended it accordingly. Two commenters suggested that proposed sec.80.5(b) be amended to expressly state that the commission may limit the issues that shall be considered by SOAH in a contested case. The commission agrees that this ability is implicit in Texas Government Code, sec.2003.047(e), and has amended the proposed section accordingly. These commenters also suggest that the proposed section be amended to provide that the commission "may," rather than "shall," identify issues to be addressed. Since Texas Government Code, sec.2003.047(e) uses "shall," the commission disagrees and declines to make this change. The commission has amended proposed sec.80.5(b) to make it clear that the executive director's petition or EDPR serves as the list of issues to be addressed by SOAH in a contested enforcement case. One commenter suggested that proposed sec.55.33(b) (the same as proposed sec.80.5(b)) be deleted, stating that while the commission may want to restrict or direct the list of issues, the proposed section suggests that a referral is not adequate if it does not. The commission disagrees, since Texas Government Code, sec.2003.047(e) clearly mandates an issues list, and since the proposed section gives the commission the flexibility to submit both broad and narrow ranges of issues. Several commenters suggested that proposed sec.80.13 be amended to allow parties, as well as the executive director, to request consolidation of related proceedings. The commission disagrees and declines to change the proposed section, because this is already allowed by the proposed sections. Proposed sec.80.13 allows the executive director to consolidate matters with the permission of the judge, and allows the judge to consolidate matters, presumably on the judge's own motion or that of any party. One commenter noted that due to changes in Chapter 291 of the commission's rules, proposed sec.80.17 does not accurately reflect the burden of proof in certain water and sewer rate cases. The commenter also noted that enforcement cases covered by subsection (c) of the rule should be expressly excepted from subsection (a). The commission agrees, and has amended the proposed section accordingly. One commenter suggested that proposed sec.80.27 be deleted as duplicative of proposed sec.sec.1.08, 1.10, 1.11, and 80.31. While the proposed sections cover similar matters, the commission disagrees and declines to make the change, because proposed sec.80.27 covers mostly matters of form, while the other proposed sections deal with more procedural matters. The commission has amended proposed sec.80.101 to make it clear that the executive director may either act on a matter remanded to the executive director or set it for consideration at a commission meeting. This is allowed by the proposed section, but the amendment lends clarity. One commenter suggested that proposed sec.80.107 is of sufficient importance that it should be dealt with as a separate subchapter. While the commission agrees that the proposed section is important, it prefers as a matter of form at this time not to create additional subchapters, and declines to make the change. One commenter suggested deleting the phrase "administrative law" from a reference in proposed sec.80.107(a)(3) to result in consistent references to the presiding officer as "judge." The commission agrees, and has amended the proposed section accordingly. One commenter suggested amending proposed sec.80.109(b) to define only statutory parties. The commission disagrees, and believes that the proposed section serves a more useful function by referring to all parties to an application, rather than just statutory parties, and declines to make this change. One commenter suggested deleting proposed sec.80.109(c) as duplicative of proposed sec.80.115. The commission agrees, and has amended the proposed section accordingly, renumbering the subsequent subsections. One commenter suggested deleting proposed sec.80.109(d) (now sec.80.109(c)) as duplicative of proposed sec.80.3(b)(5). The commission disagrees, since the section as amended in response to comments on proposed sec.80.115 now makes it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. One commenter suggested moving proposed sec.80.109(e) ((now sec.80.109(d)) to proposed sec.80.119, arguing that it makes more sense to discuss the effects of continuance in that section. The commission disagrees and declines to make the change. Proposed sec.80.109(e) (now sec.80.109(d)) is intended to make it clear that a person designated as a party retains party status regardless of any postponement of a hearing. Since the rule is limited to party status, the commission feels that it makes more sense to leave it in its present location. Several commenters commented that proposed sec.80.111 prohibits the judge and commission from considering comments. The commission disagrees, and points out that the section does not at all impair the executive director's ability to consider comments. The proposed section prohibits the judge from considering protests or comments submitted by non-parties in a non-evidentiary context (not under oath and without the opportunity to cross-examine) as evidence in contested case proceedings. The commission believes this is required by law, and declines to change the proposed section. The commission notes, however, that the phrase "[i]n proceedings other than enforcement proceedings" was inadvertently published as the end of the second sentence of this section, rather than as the beginning of the third sentence. The commission has amended the section accordingly, so that this limitation applies to questions submitted to the judge, not to the consideration of comments. One commenter noted that proposed sec.80.115 is not clear as to whether each and every party has a right to conduct discovery, present a direct case, cross- examine witnesses, obtain copies of pleadings, and so on, even when parties have been aligned under proposed sec.80.109. The commission agrees that the two provisions could be confusing when read together, and has amended proposed sec.80.109(d) to make it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. The commission anticipates that judges will exercise their best judgment when aligning parties and specifying the purposes for which they are aligned. One commenter suggested that proposed sec.80.117(b) be revised to make it clear that all persons granted party status are covered in the order of presentation. The commission agrees, and has amended proposed sec.80.117 by substituting the words "other parties" for the word "protestant." One commenter suggested deleting the word "SOAH" from proposed sec.80.119(d) to make it clear that the section does not restrict the judge in a contested case proceeding to the use solely of SOAH mediators. The commission agrees, and has amended the proposed subsection accordingly. The subsection has also been combined with proposed sec.80.119(c), to make the section shorter and more clear. One commenter suggested combining proposed sec.80.127(a)(2) and (c) to eliminate duplication. The commission agrees, and has amended the proposed section and renumbered subsections accordingly. One commenter suggested that proposed sec.80.127 be revised to more closely track the provisions of Texas Rule of Civil Procedure 267 and Texas Rule of Evidence 613, which prohibit the exclusion from the hearing room when "the rule" is invoked of an officer or employee of a party that is not a natural person and who is designated as its representative by its attorney and a person whose presence is shown by a party to be essential to the presentation of its case. The commission agrees, and has added subsection (f) to the proposed section so that it will more closely track the practice in the courts. One commenter suggested amending proposed sec.80.133 to allow the judge to set a schedule for the submission of written briefs. The commission agrees, and has amended the proposed section accordingly. Two commenters suggested that proposed sec.80.137 be amended to incorporate by reference Texas Rule of Civil Procedure 166a, because of the substantial body of interpretive case law and legal commentary available. The commission agrees that Rule 166a contains valuable guidance, and has tried to track the language of the rule in the proposed section as far as it considers appropriate given the difference between the administrative and judicial processes and the commission's assumption that the most likely use of the proposed section will be to limit issues, rather than to dispose of applications. The commission has accordingly modified the proposed section to track Rule 166a more closely, and anticipates that practitioners and judges will look to Rule 166a and the decisions construing it for guidance. Two commenters suggested that proposed sec.80.137 be amended to change some language relating to testimonial evidence. Because of the amendments noted previously, the commission believes the issue raised by this language to be resolved and declines to make further changes. One commenter suggested that proposed sec.80.151 be amended to expressly refer to Texas Rule of Civil Procedure 215. The commission disagrees, and declines to change the proposed section, because it believes that the grant of authority in Texas Government Code, sec.2003.047 and the sanctions provisions of proposed sec.80.107 already make sufficient provision for sanctions for discovery abuse. One commenter suggested that proposed Subchapter E of Chapter 80 (the "Freeze Rules") be deleted. While the commission recognizes the commenter's concern, it feels that the "freeze rules" have not yet been given a real test in practice, and is inclined to amend, rather than repeal them. The commission has corrected an incorrect reference in proposed sec.80.205 to refer to sec.80.105, rather than sec.80.60. Several commenters suggested that proposed sec.80.203(a)(1) be amended so that it does not require the executive director to prepare a draft permit if the executive director does not recommend the issuance of a permit. The commission disagrees, and declines to make this change, in part because the "freeze rules" were the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome, and in part because the failure to prepare a draft permit would present an almost insuperable barrier to an applicant should the applicant prevail on the issue of whether or not a permit should be issued. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.207(c) be amended to eliminate the additional time proposed beyond the first discovery period for filing a list of issues. The commission disagrees, and declines to make this change. An earlier version of this rule required protestants to have their issues list finished simultaneously with the end of the first discovery period, which the commission believes compresses the work that must be done. The commenter suggested that in the event the additional time remained, additional time should be added to proposed sec.80.207(e) as well. The commission disagrees and declines to make this change, since additional time is already granted by timing the applicant's response from the time the first list of issues is submitted, rather than the close of the first discovery period. Several commenters commented that proposed sec.80.207(d) allows an applicant to disrupt the work required of protestants to comply with subsection proposed sec.80.207(c), and suggested the deletion of the second sentence in subsection (d). The commission disagrees, and declines to make this change. The commenters apparently missed the time extension given in proposed sec.80.207(c), which now allows for completion of the issues list "within 20 days after the end" of the time period originally contained in old sec.265.104, from which the proposed section is derived. The result of the proposed sections is to give the protestant an additional 20 days to complete the issues list, while allowing the applicant to go forward with discovery. The result, rather than an additional burden on the protestant, is an easing of requirements. One commenter suggested that proposed sec.80.207(h) be amended to allow a limited amendment of the application in some circumstances. While the commission agrees that this commenter's point has some merit, the current arrangement was the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.209(c)(3) be amended to require the judge to distribute a prehearing order within four days from the prehearing conference. While the commission recognizes the commenter's concern and the limited (14-day) time period between the prehearing conference and the hearing, it prefers at this time to leave the timing of the prehearing order to the judge, trusting that prehearing orders will be distributed as soon as possible considering the compressed time frame. Two commenters suggested that proposed sec.80.213 be revised to make it clear that paragraph (1)(A) and (B) is not mutually exclusive and that the judge may direct a party to both voluntarily reduce its listed witnesses and provide a summary of the expected testimony of each witness. One commenter also suggested that the language of the rule be made more clear that the judge may prohibit testimony of witnesses. The commission agrees, and has amended the section accordingly. Several commenters suggested that proposed sec.80.259 be revised to eliminate a provision that would allow a judge to file an amended proposal for decision without serving it on the parties. This provision was included in a redline/strikeout version of the proposed rules distributed by agency staff during the rulemaking process, but was dropped from the proposed rule before publication, and thus no revision to the proposed rule is necessary. The staff regrets any inconvenience caused by failing to notify interested persons of the change before publication. The commission has amended proposed sec.80.263 to make it clear that the general counsel may set time limits for oral presentations before the commission. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.sec.80.265, 80.267, and 80.271 to remove the word "final" where it refers to commission decisions or orders, because the use of the word in these proposed sections may be unintentionally confusing when compared with the use of the word in Government Code, sec.sec.2001.141 - 2001.144, dealing with when decisions become final. One commenter suggested that the provision of proposed sec.80.267(b) that the commission will render a decision within 60 days after the date the hearing is finally closed does not give the commission enough time to render its decisions. The commenter suggested lengthening the time period to 90 days. The commission agrees that cases heard by a judge may take more than 60 days, but notes that the 60-day period is mandated by Texas Government Code, sec.2001. 143 unless extended. The commission believes, however, that proposed sec.80. 267(b) gives the judge enough flexibility to extend the time, and therefore declines to make the suggested revision. The commission has amended proposed sec.80.277 to more clearly reflect the commission's position and longstanding agency practice that the executive director or an authorized representative may forward an enforcement order to the attorney general for enforcement. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.86.18(c)(1)(C) to change the time period for filing applications for rehearing to 30 days to be consistent with Water Code, sec.11.316. One commenter suggested that the definition of "monitoring well" in proposed sec.340.2 be amended to expressly exclude monitoring wells used in conjunction with the production of coal and lignite, as is apparently intended by the general exclusion for wells used in conjunction with the production of "other minerals." The commission agrees, and has amended the section accordingly. One commenter noted that proposed sec.340.73 appears to differ from the requirements under discussion at the agency for sec.338.31 and sec.338.32 as to the persons to whom copies of well logs are to be submitted. The commission agrees, and has amended proposed sec.340.73 and sec.340.75 to add local underground water conservation districts and make these sections consistent. The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.40.2. Definitions. The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise. ADR-Alternative dispute resolution. Alternative dispute resolution procedure or ADR procedure-A nonjudicial and informally conducted forum for the voluntary settlement of contested matters through the intervention of an impartial third party. Alternative dispute resolution director or ADR director-The director of the agency office empowered by the commission to coordinate and oversee ADR procedures and mediators. Contested matter -A request for a license, permit, order, or other formal authorization from the commission that is opposed. Mediator-The person office director to preside over ADR proceedings regardless of which ADR method is used. Participant-The executive director, the public interest counsel, the applicant, and the persons who timely filed hearing requests which gave rise to the dispute or if parties have been named, the named parties. Private mediator -A person in the profession of mediation who is not a Texas state employee and who has met all the qualifications prescribed by Texas law for mediators. Mediator. (a) For each matter referred for ADR procedures, the ADR director shall assign a mediator, unless the participants agree upon the use of a private mediator. The ADR director may assign a substitute or additional mediator to a proceeding as the ADR director deems necessary. (b) A private mediator may be hired for commission ADR procedures provided that: (1) the participants unanimously agree to use a private mediator; (2) the participants unanimously agree to the selection of the person to serve as the mediator; (3) the mediator agrees to be subject to the direction of the commission's ADR director and to all time limits imposed by the director, the judge, statute, or regulation. (c) If a private mediator is used, the costs for the services of the mediator shall be apportioned equally among the participants, unless otherwise agreed upon by the participants, and shall be paid directly to the mediator. In no event, however, shall any such costs be apportioned to a governmental subdivision or entity that is a statutory party to the hearing. (d) All mediators in commission mediation proceedings shall subscribe to the ethical guidelines for mediators adopted by the ADR Section of the State Bar of Texas. sec.40.5. Qualifications of Mediators. (a) The commission shall establish a pool of commission staff mediators to resolve contested matters through ADR procedures. (1) To the extent practicable, each mediator shall receive 40 hours of formal training in ADR procedures through programs approved by the ADR director. (2) Other individuals may serve as mediators on an ad hoc basis in light of particular skills or experience which will facilitate the resolution of individual contested matters. (b) SOAH mediators, employees of other agencies who are mediators, and private pro bono mediators may be assigned to contested matters as needed. (1) Each mediator shall first have received 40 hours of Texas mediation training as prescribed by Texas law. (2) Each mediator shall have some expertise in the area of the contested matter. (3) If the mediator is a SOAH judge, that person will not also sit as the judge for the case if the contested matter goes to public hearing. sec.40.6. Commencement of ADR. (a) The commission encourages the resolution of disputes at any time, whether under this chapter or not. ADR procedures under this chapter may begin, at the discretion of the ADR director, anytime after the application has been deemed administratively complete and at least one letter protesting the application has been filed with the commission. (b) Upon unanimous motion of the parties and at the discretion of the judge, the provisions of this subsection may apply to contested hearings. In such cases, it is within the discretion of the judge to continue the hearing to allow the use of ADR procedures. sec.40.8. Agreements. Agreements of the participants reached as a result of ADR must be in writing, and are enforceable in the same manner as any other written contract. sec.40.9. Confidentiality of Communications in Alternative Dispute Resolution Procedures. (a) Except as provided in subsections (c) and (d) of this section, a communication relating to the subject matter made by a participant in an ADR procedure, whether before or after the institution of formal proceedings, is confidential, is not subject to disclosure, and may not be used as evidence in any further proceeding. (b) Any notes or record made of an ADR procedure are confidential, and participants, including the mediator, may not be required to testify in any proceedings relating to or arising out of the matter in dispute or be subject to process requiring disclosure of confidential information or data relating to or arising out of the matter in dispute. (c) An oral communication or written material used in or made a part of an ADR procedure is admissible or discoverable only if it is admissible or discoverable independent of the procedure. (d) If this section conflicts with other legal requirements for disclosure of communications or materials, the issue of confidentiality may be presented to the judge to determine, in camera, whether the facts, circumstances, and context of the communications or materials sought to be disclosed warrant a protective order or whether the communications or materials are subject to disclosure. (e) The mediator may not, directly or indirectly, communicate with the judge or any commissioner, on any aspect of ADR negotiations made confidential by this section. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606778 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Chapter 50. Action on Applications The commission adopts new sec.sec.50.2, 50.13, 50.15, 50.17, 50.31, 50.33, 50.35, 50.37, 50.39, and 50.41, concerning procedural rules. Sections 50.13, 50.17, 50.31, and 50.39 are adopted with changes to the proposed text as published in the March 19, 1996, issue of the Texas Register (21 TexReg 2128). Sections 50.2, 50.15, 50.33, 50.35, 50.37, and 50.41 are adopted without changes and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. Comments were received from Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts. Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts generally supported the adoption of the proposed sections with some changes. Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund, while apparently not opposing the adoption of the proposed sections as a whole, generally expressed concerns related to public participation and issues related to delegated federal programs. A number of commenters suggested minor editorial, typographical, and grammatical changes to clarify or shorten the proposed sections. The commission generally agrees with these suggestions, and has amended the proposed sections accordingly. These changes have been made to proposed sec.sec.1.1, 1.5, 1.7, 1.10, 1.11(a), 3.2, 5.3, 5.8, 5.10, 5.11, 5.12, 5.14, 10. 1, 10.2, 10.3, 10.6, 10.8, 20.17, 40.5, 40.6, 40.8, 40.9, 50.13, 50.17, 50.31, 55.21, 55.23, 55.25, 55.27, 55.29, 55.31, 70.2, 70.3, 70.4, 70.5, 70.6, 70.7, 70.8, 70.9(b), 70.10, 70.11, 70.101, 70.102, 70.104, 70.107, 70.108, 70.109, 80.3, 80.11, 80.17, 80.21, 80.23, 80.29, 80.31, 80.33, 80.109, 80.111, 80. 113(c), 80.115, 80.119, 80.127, 80.133, 80.155, 80.201, 80.205, 80.207, 80.209, 80.213, 80.251, 80.253, 80.257, 80.265, 80.267, 80.271, 86.1, 86.11, 86.15, 86.16, 86.34, 86.55, 86.96, 86.98, 86.99, 86.130, 86.131, 86.132, 340.41(b), 340.43(d), 340.45, 340.53(d), 340.71, 340.73, and 340.131. The titles of proposed sec.sec.10.9, 20.19, 40.5, 40.6, 40.8, 50.39(e), 55.31, 70.109, 80.5, 80.23(b), Chapter 50, Subchapter B and Chapter 86, Subchapter D have also been amended for clarity and to reflect their true content. Several commenters commented generally that the proposed sections limit public participation in permit and enforcement actions more stringently than allowed under federal law and do not meet the minimum requirements for federal program approval, basing this comment in part on a draft report prepared by one of the commenters. The commission disagrees. The commenters very narrowly construe the concept of public participation, and the commission does not agree that the statistics contained in the draft report are accurate. The commission does not agree that such a narrow emphasis on contested case evidentiary hearings at the expense of other methods of public participation is either fair or appropriate. The commission also does not agree that the proposed sections impose new limits on public participation. Although the commission's process will be continually reviewed and improved, the process and the proposed sections are consistent with the "United States Environmental Protection Agency's (EPA) Policy Statement of Public Participation," which contains no requirement for contested case hearings on every permitting matter. Public notice is given in compliance with statutory requirements, and when questions or comments from the public are received, the agency's technical staff responds to them. Agency permit engineers and attorneys spend a considerable amount of time answering questions from the public, meeting with them, educating citizens on both the scientific and legal requirements of permits. As questions are raised, staff reconfirms the review and position it is taking on permits. When there is considerable public interest expressed, the agency often will hold one or more public meetings in the local area to encourage give and take between the public, the applicant, and the staff. This is in addition to public meetings that may be required by statute (e.g., Texas Health and Safety Code, sec.361.0791, on hazardous waste management permits). Most importantly, the commenters overlook the provisions of the proposed sections which in fact dramatically increase the opportunity for public participation-now, every motion for reconsideration of an executive director's action goes directly to the commission, and every hearing request is placed on a commission meeting agenda with the right of the requestor to share information and concerns directly with the three commissioners. Most determinations on hearing requests, prior to September 1, 1995, were handled by the Office of Hearing Examiners with little, if any, involvement by the commissioners. The public now has the ability to submit information and concerns to the commissioners, very often has the ability to personally address the commissioners, and the commissioners have the ability to require the applicant and the executive director's staff to respond to those concerns. The exchange takes place in a posted, public hearing. This satisfies the "exchange of views and open exploration of issues, alternatives, and consequences" standard contained in the EPA Policy Statement. Although the commission believes that the proposed sections represent a dramatic improvement, the commission continues to explore ways to enhance this exchange of views. Several commenters suggested that the commission failed to provide notice of the procedural rule changes to the EPA as required. The commission disagrees. The commenters erroneously interpret 42 United States Code, sec.300h- 1(b)(1)(A)(ii) to require notice prior to final adoption of this rule package. Correctly read, the statute only requires notice of a rule change to the EPA after final adoption of an underground injection well program or changes to the program. Upon adoption of this package, the commission will provide appropriate notice to the EPA. One commenter suggested that proposed sec.1.1 be expanded to address both the purpose and scope of the commission's rules. The commission disagrees with this proposal because the language proposed would state what is already law, that the rights of parties and the commission's powers are established by statute and cannot be enlarged by rule, and that the statutes prevail if the commission's rules are in conflict with them. Several commenters criticized the commission's handling of confidential documents under current rules being revised and adopted as proposed sec.1.5. The commission disagrees with these comments because the commission's management of confidential documents complies with all applicable requirements. Another commenter proposed additional language for this section which would specify the duties of the agency's central records office. The commission disagrees, because the proposed directives concerning internal office procedure can be made without adopting the directives as a rule. The commission notes that it has recently directed its executive director to evaluate the agency's record management practices. This evaluation is already under way, and will include the agency's handling of confidential documents to ensure they are not inadvertently disclosed to the public. A request for proposal has been published for a study on the matter. One commenter suggested that proposed sec.1.11 be amended to make it clear what is included in the phrase "courier-receipted delivery service." The commission believes that the phrase is sufficiently clear, and declines to add any definition beyond that already provided in Texas Rule of Civil Procedure 21a. The commission believes that the modifications to proposed sec.1.11 described as follows may also resolve the commenter's concerns. One commenter noted that proposed sec.1.11 and sec.10.10 appear to be missing subsection (e), which appears in old sec.261.18, from which they are derived. The commission agrees. This deletion was inadvertent, since proposed sec.1.11 and sec.10.10 were intended to include the provisions of old sec.261.18. Proposed sec.10.10 duplicates proposed sec.1.11 and has been deleted, and subsection (e) has been added to proposed sec.1.11. In addition, the commission has further clarified proposed sec.1.11 by more closely tracking Texas Rule of Civil Procedure 21a, which the commission believes covers the same subject matter more completely, and has amended and renumbered subsections accordingly. One commenter suggested that proposed sec.3.2 be revised to incorporate several definitions currently contained in other chapters. The commission agrees in part, and has added definitions of "enforcement action" and "enforcement order" to proposed sec.3.2. Other definitions not moved are used only in single chapters, and the commission believes it more useful to leave those definitions in the chapter to which they apply, rather than move them to a general definitions section. The commission intends, however, to continue to consolidate widely used definitions in Chapter 3 for clarity and consistency. One commenter suggested that the definition of "advisory committee" in proposed sec.5.2 be condensed. The commission agrees, and has amended the proposed section accordingly. This commenter also suggested that this definition be moved from proposed sec.5.2 to proposed sec.3.2. Since this term seems to be used only in proposed Chapter 5, the commission disagrees and has left the definition in proposed sec.5.2. One commenter suggested that proposed sec.10.7 be amended to clarify that the commission will keep a certified agenda of closed meetings held in accordance with the requirements of the Texas Open Meetings Act. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.10.9 and sec.10.10 duplicate proposed sec.1.10 and sec.1.11, and suggested that the proposed sections appear only in proposed Chapter 1. The commission agrees, and has deleted proposed sec.10.10 and amended proposed sec.10.9 to change its title and refer to proposed sec.1.10 and sec.1.11. One commenter suggested that proposed Chapter 40 be amended to allow participation in Alternative Dispute Resolution (ADR) by "interested parties" and to allow mediation to occur before a request for hearing is made. While the commission wholeheartedly supports ADR efforts, it disagrees for two reasons, and declines to make the change. First, participation in ADR in contested cases must necessarily be limited to the parties to the case, or at the hearing request stage, to those filing hearing requests as well. Without this limitation, the commission believes it will be difficult for participants to commit to a process where the number and identity of negotiating parties is subject to change. Second, while the commission is strongly committed to ADR, and encourages its use at all stages of the application process, it believes that it is wiser to continue to encourage informal ADR outside of agency rules prior to entry into the contested case process, and leave its use up to the participants, rather than attempt to promulgate rules governing its use at this time. One commenter suggested that the definition of the term "alternative dispute resolution office" in proposed sec.40.2 be replaced with a definition of the term "alternative dispute resolution director" because the latter is used throughout proposed Chapter 40. The commission agrees, has amended the proposed section accordingly, and has also amended proposed sec.40.5(a)(1) accordingly. One commenter suggested deleting the words "regardless of which ADR method is used" from the definition of "mediator" in proposed sec.40.2, as not adding to the definition. The commission disagrees, because it believes that the term "mediator" is used in some circles as a term of art to refer only to a person engaged in specific dispute resolution procedures, and the term is used in these proposed sections in a more inclusive manner. One commenter suggested using the word "applicant" rather than a longer term in the definition of "participant" in proposed sec.40.2, and adding "named parties" to the definition to make clear that they are included in the definition. The commission agrees, and has amended the proposed section accordingly. One commenter suggested deleting the words "from the pool of mediators" from the first sentence of proposed sec.40.4(a) and adding clarifying language regarding private mediators, to make the proposed section more consistent with the other proposed sections of the chapter. The commission agrees, and has amended the proposed section accordingly. One commenter suggested rewording proposed sec.40.4(c) for brevity and clarity. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.40.6 could be read to exclude the possibility of a matter being referred to ADR after a draft permit is proposed and a protest letter received, but prior to the matter being referred to the State Office of Administrative Hearings (SOAH), as proposed sec.55.25(d)(1) anticipates, and suggested amending the proposed section. The commission agrees with the commenter that this can be the most productive period for ADR, expressly desires to encourage ADR at this point, and has amended the proposed section to make it clear that cases may be referred to ADR at this point and that ADR outside of the commission process may be used at any time. Several commenters commented that proposed sec.50.13 and sec.50.33 allow the commission and its executive director to act on an application without considering any comments, and generally maintain that the proposed sections of procedural rules as a whole preclude public comment. The commenters also claim that the provisions of proposed sec.50.33 which prevent action by the executive director where there is a "protest" and the provision for motions for reconsideration are not an adequate substitute for a public comment process. The commission disagrees, and declines to amend the proposed sections. Proposed sec.50.13 and sec.50.33 allow action without a contested case hearing, which is not equivalent to action without considering comments. The procedures contained in the proposed procedural rules sections are, for the most part, in addition to the commission's public comment process, rather than a substitute for them, as the commenters apparently assume, and the equation of participation in a contested case hearing with public comment is inappropriate. The commission actively encourages public participation, and has gone on record repeatedly to express this and to broaden public participation, but believes that the amendments suggested by the commenters go far beyond the scope of this rulemaking. One commenter suggested that proposed sec.50.39 be amended to allow only an "affected person" to file a motion for reconsideration of an executive director's action on an application, suggesting that the term "other person" is too broad. The commission disagrees, and declines to change the proposed section, because the proposed language gives the commission flexibility to reconsider decisions in situations where the error complained of merits attention regardless of who raises it. Additionally, allowing any person to file a motion for reconsideration allows another avenue for public comment by bringing concerns directly to the attention of the commission. The commission believes, however, that the question of whether a person filing a motion for reconsideration is an affected person will in some cases have a bearing on whether the commission acts on the motion. Several commenters criticized proposed sec.55.21(b) and (d), claiming that because of multiple publications, it may be difficult to tell when the deadline for a hearing request occurs. While much of the timing and many of the contents of notices are specifically required by statute, to the extent that this becomes a problem, the commission plans to deal with it in rulemaking on a new proposed chapter governing public notice, rather than in this rulemaking. Several commenters suggested that proposed sec.55.21(c) constitutes an unlawful delegation and allows the person who designs a notice to decide what will be required in a hearing request. The commenters further assert that the proposed section does not adequately plan for errors in the published notice. The commission disagrees, and declines to change the proposed section. The statutes and other sections of the commission's rules dictate the content of public notices, and this proposed section merely requires hearing requests to comply with those requirements, if any. If the notice is defective, this must be generally cured through republication, thus giving another chance to comply with any requirements. Several commenters criticized proposed sec.55.21(e) for not establishing procedures for requesting extensions of time and suggested the inclusion of a "good cause" or public interest test. The commission disagrees. This section is primarily intended to allow the commission to consider late hearing requests. The commission believes that the proposed section allows more flexibility for the commission and the public than the suggestion does, and declines to change the section. One commenter suggested that proposed sec.55.23(b) be revised to require a group or association to provide an explanation of its hearing request with sworn affidavits, written resolutions, or other satisfactory documentation, rather than to allow other parties to request such an explanation. The commission disagrees. While the proposed sections anticipate that a group or association will submit such information, requiring this as an absolute requirement in advance when the group or association's qualifications are not in dispute is burdensome and unnecessary. However, allowing the listed parties to request that evidence, if they believe it to be an issue, protects the integrity of the hearing process and the rights of the applicant while limiting evidence and testimony to those issues that are actually in dispute. Several commenters suggested that proposed sec.55.23(b) and sec.55.26(f) place unreasonable burdens on the public in replying to responses to hearing requests. There is no proposed sec.55.26 and the latter reference is apparently to proposed sec.55.25(f). The commission disagrees, because these proposed sections merely provide a way for the commission and other parties to determine the basis of a hearing request, which is clearly relevant under Texas Water Code, sec.5.115. While the commission does not agree that the proposed time periods are unreasonable, it has determined that the time for replying to responses to hearing requests in proposed sec.55.25(f) should be lengthened from ten days to 14 days to give requestors more time to prepare, and has amended proposed sec.55.25 accordingly. Several commenters suggested that the commission amend proposed sec.sec.55.25, 55.27, 55.29, and 55.31, to change the way the commission deals with hearing requests and with determinations of whether a person is an "affected person," whether a request is "reasonable," and what constitutes "competent evidence" under Texas Water Code, sec.5.115. The commission agrees that these items may need further attention, but, as announced at the beginning of this phase of rulemaking and stated in the preamble to these proposed rules, has reserved this issue for further rulemaking, once sufficient experience has been accumulated with the existing process to fairly evaluate how well the existing rules are working. This project is already underway at the agency, and the commission expects that it will get into full swing shortly after this rulemaking project is concluded. While some minor adjustments to the current process are included in this round of rulemaking, the commission declines to make the suggested major changes in this round of rulemaking. Several commenters suggested that the proposed sections place an unreasonable burden on who can qualify for a hearing and claimed that the commission has not implemented its authority to provide for public participation in hearings. The commission disagrees. As noted previously, the commission believes that the proposed sections broadly encourage public participation. In addition, the proposed sections are entirely consistent with the law on hearings and standing. Finally, the commission is already committed to reviewing this process in another round of rulemaking. Several commenters suggested that proposed sec.55.25(g) be revised to allow a legislator (for an activity in the legislator's district), a state agency, a federal agency, or a local government (for a facility within the local government's jurisdiction) to send an application directly to SOAH for a contested case hearing. The commission disagrees. Nothing in the statutes grants such blanket rights, and the commission believes that adding this provision would violate both the letter and intent of Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115, as well as other specific statutes dealing with contested case hearings, and therefore declines to make this change. One commenter noted that the provisions of proposed sec.55.27 and sec.55.29 do not appear to address instances where the definition of affected persons in the rule (and in Texas Water Code, sec.5.115) may differ from specific statutory provisions defining "affected person" or "person affected," and suggested that the proposed sections be revised to make it clear that specific statutory provisions control. In the alternative, the commenter suggested that the commission apply both the definition of "affected person" in the proposed sections and any specific statutory definition. The commission agrees with the commenter that Texas Water Code, sec.5.115, the proposed sections, and other specific statutes can and should be read together. Generally, Texas Water Code, sec.5.115 will require a "personal justiciable interest," while other specific statutory provisions delineate those interests, specifying distance limitations or identifying specific persons who can request a hearing. The commission believes that the provisions of proposed sec.55.27 (that a hearing request be granted if it is "pursuant to a right to hearing authorized by law") and proposed sec.55.29 (that a relevant factor in determining whether a person has "a personal justiciable interest related to a legal right, duty, privilege, power, or economic interest affected by the application" is "whether the interest claimed is one protected by the law under which the application will be considered") require Texas Water Code, sec.5.115 and any applicable specific statute to be read together. Thus, the commission declines to modify the proposed sections. Several commenters suggested that proposed sec.55.27(b) and (c) be amended on the grounds that they conflict with statutory provisions such as Texas Water Code, Chapter 27, in which counties are granted hearings regardless of a showing of standing or reasonableness of their hearing requests. The commenters also suggested that the test for a state agency or local government needs to be clarified, alleging, for example, that a county is automatically an affected person for an activity in that county. The commission disagrees. No statute, other than those giving party status to the executive director, public interest counsel, Texas Water Development Board, and Texas Parks and Wildlife Department, provides as a blanket rule that a governmental entity is automatically an affected person for all activities in a geographic area, although some do in specific instances. Texas Water Code, sec.27.018, for instance, provides for a hearing on an injection well permit application if one is requested by a "local government." The statute further distinguishes between the terms "local government" and "affected person"-a distinction that does not appear in Texas Water Code, sec.5.115. While there may be some confusion over the use of the term "affected person" in more than one context, the commission believes that it is clear that a hearing request by a local government under Texas Water Code, sec.27.018 meets the tests of reasonableness and being "pursuant to a right to hearing authorized by law" under proposed sec.55.27(b) and "in the public interest" under proposed sec.55.27(c), and that a governmental entity may be an affected person given the definition of "person" contained in proposed sec.3.2 and its "authority under state law" in proposed sec.55.29(b). The commission further believes that the tests for a state agency or local government are sufficiently clear, and therefore declines to amend the proposed sections. Two commenters suggested that the provisions of proposed sec.55.27(c), which allow the commission to refer an application to SOAH for hearing if the commission determines that a hearing would be "in the public interest" even if there is no valid hearing request, be deleted or that the commission delineate standards it will use in making this determination. Several commenters suggested that the provision is vague in that it does not define "public interest." The commission disagrees with these comments and declines to make the suggested changes, in that it believes that there may be situations where the public interest demands a hearing (one example might be information received after the deadline for hearing requests), and also believes that it would be impossible to define "public interest" at this time in terms more specific than those used by the statutes under which the commission operates. One commenter suggested that proposed sec.55.27(c) be deleted as duplicative of proposed sec.55.27(b)(1). The commission disagrees and declines to make the proposed change. Proposed sec.55.27(b)(1) allows a commissioner, an applicant, or the executive director to request a contested case hearing and thereby refer a case to SOAH, while proposed sec.55.27(c) allows the commission as a whole to vote to send a case to SOAH. The two provisions serve different purposes and the commission believes they should be kept separate. Several commenters suggested that the commission's rules on notice need significant changes, and suggested that proposed sec.55.27(c) be amended to prohibit the final notice on a permit from being issued before technical review is complete and a draft decision is available. The commission does not agree that these proposed sections are the place to deal with notice requirements, notes that no notice has been given to the public or interested parties that notice requirements would be changed in these proposed sections, and points out that it is in the process of preparing for publication a new chapter to consolidate many of its notice rules. However, the commission disagrees with the commenters that the existing rules regarding notice are inadequate or restrict public participation. Proposed sec.55.27(c) does not deal with notice, but rather allows the commission to refer an application to SOAH even if there is no hearing request, and the commission does not agree that amending it to deal with notice would be appropriate or advisable. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear whether an administrative law judge can overrule a commission denial of a hearing request based on standing. The commission has amended proposed sec.55.27(f) to make its position on this issue more clear-that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear what must be done to appeal the denial of a hearing request, do not make it clear when the time period for appeal begins to run, and add new burdens by requiring two appeals. The commission does not agree, and declines to further amend the proposed sections beyond the amendments already described. The proposed sections make it clear that a party whose hearing request is denied must seek to obtain party status and then, if unsuccessful, follow procedures for a motion for rehearing as a prerequisite to appeal once the commission has disposed of the application. Since a person who files a hearing request is asking that a contested case hearing be held, that party obtains the relief sought if any hearing request is granted. That person must then seek to be admitted as a party if the person wishes to participate in the case, and decisions on that issue will be handled as they are now, although the commission anticipates that if the person has a complaint at this point, it will be the denial of party status or a limitation of issues rather than a determination on a hearing request. If all hearing requests are denied or withdrawn, persons whose requests are denied have an opportunity for the review of that decision by filing a motion for rehearing after the commission's decision on the application -that is, at the end of the case, rather than in an interlocutory appeal, as the commenters seem to suggest. The commission believes that it is clear in the proposed sections that the time period for appeals begins to run at this point. While the commenters also suggest that it is unreasonable to force parties to go through a hearing and have the result of that hearing reversed by a court based on an error in denying party status, the commission believes that the risk of this kind of result is minimal, is inherent in every determination of party status in any kind of proceeding, and is outweighed by the burden to the public that would be imposed by delaying every permitting decision until determinations of party status are appealed through the court system. Two commenters noted that proposed sec.55.27(f) allows a person whose hearing request is denied to still seek to be admitted as a party, and suggested that absent some compelling reasons, the commission's determination on the hearing request should preclude the later admission of the person as a party. The commission disagrees, and has amended the proposed section as noted previously to make it clear that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. One commenter suggested that proposed sec.55.27 be amended to allow a motion for reconsideration, rather than a motion for rehearing, of the denial of a hearing request, suggesting that the latter is only appropriate in contested cases under the Administrative Procedure Act, and that no contested case arises if a hearing request is not granted. The commission disagrees. As stated previously, the commission believes that a decision on the validity of a hearing request is an interlocutory decision only on the validity of the request, and does not necessarily dictate the outcome of a later decision on party status, or standing. The commission believes that a motion for rehearing at the conclusion of the proceedings is the most appropriate way to review such a decision. Several commenters remarked that the proposed sections do not allow for an adequate record for judicial review when no contested case hearing is held and do not establish standards for a court to use in its review. The commenters also suggest that the proposed sections do not create an adequate record in rulemaking. The commission disagrees, and declines to make changes based on this comment, because it believes that the record created is sufficient for judicial review of the commission's actions, and the standards of review are already clearly established in the statutes and rules. Similarly, the commission believes that the record created in rulemaking proceedings is more than adequate. Several commenters suggested that proposed sec.55.29 and sec.55.31 be revised to provide that the commission accept as true written statements of a person filing a hearing request for the purposes of the determination on the request or the person requesting a hearing be given an opportunity to present evidence to meet the burden of presenting competent evidence under Texas Water Code, sec.5.115. The commission disagrees and declines to make these changes. The first alternative ignores the clear intent of Texas Water Code, sec.5.115, by allowing a person to meet its standards by simply claiming that the standards are met. Texas Water Code, sec.5.115 provides that the commission "is not required to hold a hearing if the commission determines that the basis of the person's hearing request is unreasonable or is not supported by competent evidence." The second alternative does not recognize that this determination will require different procedures in different cases, and the flexibility which the proposed sections provide-from a decision on the pleadings to oral argument to an evidentiary hearing-allows for procedures to be followed which are appropriate for the cases presented. For example, a permit renewal under Texas Health and Safety Code, sec.382.056 may be an example of a case where requests not alleging increases in emissions or compliance problems can be dealt with on the pleadings alone. Similarly, a person who cannot allege a reasonable basis for a hearing request or who cannot allege that competent evidence exists to support the request, despite having more than one opportunity to do so (the request itself, a reply filed under proposed sec.55. 25(f) to responses that point out the merits or deficiencies of the request, and, in appropriate cases, argument or testimony before the commission) is not going to be able to present such evidence at a hearing, and it may be appropriate to resolve this request without an evidentiary hearing. Several commenters suggested that proposed sec.55.31 is unconstitutionally vague and conflicts with other Texas Natural Resource Conservation Commission rules and the law, specifically proposed sec.55.29 and Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115 and that the provisions of proposed sec.55.31(b)(3) are overly burdensome on public participation. The commission disagrees. The commission believes that the proposed section fully complies with the constitution and with Texas Health and Safety Code, sec.382. 056 and Texas Water Code, sec.5.115. The term "reasonableness" is adequately defined by proposed sec.55.31. Further, proposed sec.55.31 does not conflict with proposed sec.55.29, because they deal with different matters -the first with the determination of whether a person is an "affected person," and the second with whether a hearing request is "reasonable." Several commenters suggested that the proposed rules be revised to "provide that the commission will make determinations and record those determinations so that the public can understand the basis for its government's decision and so that a reviewing court can determine if the actions of the commission should be affirmed or reversed." As noted previously, the commission believes that the proposed sections do exactly that and declines to make changes based on this comment. Several commenters suggested that proposed sec.55.33(a)(3) (and presumably proposed sec.80.5(a)(3)) be revised, claiming that the proposed section requires the Chief Clerk to pay the cost for issuing public notices. The commission disagrees, since the proposed section requires the clerk to issue notice and does not provide for the Clerk to pay the cost of notice, since applicants are clearly responsible for those costs. Proposed sec.55.33 has been withdrawn, however, and only proposed sec.80.5 now governs the Chief Clerk's actions in this context. Several commenters noted that the setting procedures of proposed sec.55.33 largely duplicate those of proposed sec.80.5, and suggested the deletion of one or the other. Some commenters suggested conforming these two proposed sections. The commission agrees that these sections are duplicative and should be conformed, and notes as well that proposed sec.70.109 largely duplicates both of these sections. For clarity, the commission believes that it is most logical to lay out all setting procedures only in proposed Chapter 80, and has deleted proposed sec.55.33 and amended proposed sec.70.109 accordingly. Several commenters suggested that the proposed sections of proposed Chapter 70 limit public participation in enforcement proceedings in a fashion that does not meet the federal requirements for such participation and further state that notice in the Texas Register is insufficient. The commission disagrees, and declines to change the proposed sections. The agency complies with federal authorization rules regarding public participation in enforcement matters, which require the agency to have procedures in place for responding to citizen complaints, publish notice of settlements of civil actions, and give assurance that it will not oppose intervention by any citizen when permissive intervention is authorized by statute, rule, or regulation. In regard to the comment that Texas Register publication is insufficient, while the commission disagrees, it is currently considering alternative citizen participation in administrative actions. If rule changes are necessary after a decision is made on this issue, they will be taken up separate from this rulemaking. One commenter suggested that the definitions of "enforcement order," "enforcement action," "petition," and "respondent" be moved from proposed sec.70.2 to proposed sec.3.2. The commission agrees that the definitions of "enforcement action" and "enforcement order" should be moved to sec.3.2 since they are used in general context in other chapters of the agency's rules; however, the terms "petition" and "respondent," as they are defined in proposed Chapter 70, are specific to enforcement actions by the commission only and should remain in proposed Chapter 70. The commission does not believe that generic definitions of petition and respondent are necessary in proposed Chapter 3 to cover permitting matters because those terms are generally accepted legal terminology and "petition" is already included in the definition of "application." One commenter suggested that proposed sec.70.51 substantially changes old sec.337.71 from relating only to water rights enforcement matters to a more general mandatory enforcement hearing process. The commission disagrees. The language in proposed sec.70.51 was taken verbatim from old sec.337.71, except that the title of the subchapter was changed and references to other rules which had been renumbered were changed. The definitions included in old sec.337. 71 included water quality, water rights, hazardous waste releases, and references to the air statute as well. Although the title of old sec.337.71 indicated "Water Rights Enforcement," its statutory basis is Texas Water Code, sec.5.117, which applies to the agency as a whole, and requires the executive director to bring all instances of substantial noncompliance before the commission. The commenter expressed concern that proposed sec.70.51 would require mandatory hearings for incorrect compliance with record keeping requirements in an air permit. Since this would normally not be a substantial noncompliance under the air rules, this section would not apply in that case. Furthermore, old sec.337.71 and proposed sec.70.51 both exclude air violations, since a separate statutory requirement exists for the air program. The program most affected by this statutory requirement is the water quality program, which has a large amount of self-reporting data submitted each month. The proposed section basically sets forth the practice of the watershed management and enforcement divisions in processing this large volume of documents and describes how they determine what constitutes a substantial noncompliance. One commenter suggested that the concept of "executive director preliminary reports" (EDPR), used in proposed sec.70.101, is not necessary in proposed Chapter 70 and is not mandated by statute. While EDPRs are not required by statute, they are clearly allowed and anticipated by statute (see Texas Water Code, sec.sec.13.4151(c) and (d), 26.136(d) and (e), 27.1015(d) and (e), 34. 011(d) and (e) and Texas Health and Safety Code, sec.sec.341.049(c) and (d), 361. 252(d) and (e), 366.0924(d) and (e), 382.088(d) and (f), and 401.384- 401.385). This rulemaking does not alter the provisions in old Chapter 337 regarding preliminary reports, and sets forth the agency's procedures if preliminary reports are chosen as the form of pleading in a case. The executive director is not required to issue a preliminary report, but is given an option which may be used on a case-by-case basis, which is consistent with the statutory provisions. The commission disagrees with the comment and declines to change the proposed section. The commission has determined that the setting procedures of proposed sec.70. 109 largely duplicate those of proposed sec.80.5, and has amended them to simply refer to proposed sec.80.5. The commission has also amended the title of this section for clarity. One commenter suggested that proposed sec.80.3(a) be amended to make it clear that the judge sitting in a phase of a hearing, not the presiding judge, will resolve evidentiary questions raised during that phase of a hearing. The commission generally agrees, but believes that it may be necessary for a judge sitting in one phase of a hearing to refer some important evidentiary questions to the presiding judge, and has amended the section accordingly. Two commenters suggested that proposed sec.80.3(b)(10) be revised to make it clear that the judge may limit the time of presentation of evidence and witnesses without unfairly prejudicing the rights of parties. The commission agrees, and has amended the rule accordingly. In addition, the commission believes that splitting proposed sec.80.3(a) into two subsections and redesignating proposed sec.80.3(b) as sec.80.3(c) makes the proposed rule more readable, and has amended it accordingly. Two commenters suggested that proposed sec.80.5(b) be amended to expressly state that the commission may limit the issues that shall be considered by SOAH in a contested case. The commission agrees that this ability is implicit in Texas Government Code, sec.2003.047(e), and has amended the proposed section accordingly. These commenters also suggest that the proposed section be amended to provide that the commission "may," rather than "shall," identify issues to be addressed. Since Texas Government Code, sec.2003.047(e) uses "shall," the commission disagrees and declines to make this change. The commission has amended proposed sec.80.5(b) to make it clear that the executive director's petition or EDPR serves as the list of issues to be addressed by SOAH in a contested enforcement case. One commenter suggested that proposed sec.55.33(b) (the same as proposed sec.80.5(b)) be deleted, stating that while the commission may want to restrict or direct the list of issues, the proposed section suggests that a referral is not adequate if it does not. The commission disagrees, since Texas Government Code, sec.2003.047(e) clearly mandates an issues list, and since the proposed section gives the commission the flexibility to submit both broad and narrow ranges of issues. Several commenters suggested that proposed sec.80.13 be amended to allow parties, as well as the executive director, to request consolidation of related proceedings. The commission disagrees and declines to change the proposed section, because this is already allowed by the proposed sections. Proposed sec.80.13 allows the executive director to consolidate matters with the permission of the judge, and allows the judge to consolidate matters, presumably on the judge's own motion or that of any party. One commenter noted that due to changes in Chapter 291 of the commission's rules, proposed sec.80.17 does not accurately reflect the burden of proof in certain water and sewer rate cases. The commenter also noted that enforcement cases covered by subsection (c) of the rule should be expressly excepted from subsection (a). The commission agrees, and has amended the proposed section accordingly. One commenter suggested that proposed sec.80.27 be deleted as duplicative of proposed sec.sec.1.08, 1.10, 1.11, and 80.31. While the proposed sections cover similar matters, the commission disagrees and declines to make the change, because proposed sec.80.27 covers mostly matters of form, while the other proposed sections deal with more procedural matters. The commission has amended proposed sec.80.101 to make it clear that the executive director may either act on a matter remanded to the executive director or set it for consideration at a commission meeting. This is allowed by the proposed section, but the amendment lends clarity. One commenter suggested that proposed sec.80.107 is of sufficient importance that it should be dealt with as a separate subchapter. While the commission agrees that the proposed section is important, it prefers as a matter of form at this time not to create additional subchapters, and declines to make the change. One commenter suggested deleting the phrase "administrative law" from a reference in proposed sec.80.107(a)(3) to result in consistent references to the presiding officer as "judge." The commission agrees, and has amended the proposed section accordingly. One commenter suggested amending proposed sec.80.109(b) to define only statutory parties. The commission disagrees, and believes that the proposed section serves a more useful function by referring to all parties to an application, rather than just statutory parties, and declines to make this change. One commenter suggested deleting proposed sec.80.109(c) as duplicative of proposed sec.80.115. The commission agrees, and has amended the proposed section accordingly, renumbering the subsequent subsections. One commenter suggested deleting proposed sec.80.109(d) (now sec.80.109(c)) as duplicative of proposed sec.80.3(b)(5). The commission disagrees, since the section as amended in response to comments on proposed sec.80.115 now makes it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. One commenter suggested moving proposed sec.80.109(e) ((now sec.80.109(d)) to proposed sec.80.119, arguing that it makes more sense to discuss the effects of continuance in that section. The commission disagrees and declines to make the change. Proposed sec.80.109(e) (now sec.80.109(d)) is intended to make it clear that a person designated as a party retains party status regardless of any postponement of a hearing. Since the rule is limited to party status, the commission feels that it makes more sense to leave it in its present location. Several commenters commented that proposed sec.80.111 prohibits the judge and commission from considering comments. The commission disagrees, and points out that the section does not at all impair the executive director's ability to consider comments. The proposed section prohibits the judge from considering protests or comments submitted by non-parties in a non-evidentiary context (not under oath and without the opportunity to cross-examine) as evidence in contested case proceedings. The commission believes this is required by law, and declines to change the proposed section. The commission notes, however, that the phrase "[i]n proceedings other than enforcement proceedings" was inadvertently published as the end of the second sentence of this section, rather than as the beginning of the third sentence. The commission has amended the section accordingly, so that this limitation applies to questions submitted to the judge, not to the consideration of comments. One commenter noted that proposed sec.80.115 is not clear as to whether each and every party has a right to conduct discovery, present a direct case, cross- examine witnesses, obtain copies of pleadings, and so on, even when parties have been aligned under proposed sec.80.109. The commission agrees that the two provisions could be confusing when read together, and has amended proposed sec.80.109(d) to make it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. The commission anticipates that judges will exercise their best judgment when aligning parties and specifying the purposes for which they are aligned. One commenter suggested that proposed sec.80.117(b) be revised to make it clear that all persons granted party status are covered in the order of presentation. The commission agrees, and has amended proposed sec.80.117 by substituting the words "other parties" for the word "protestant." One commenter suggested deleting the word "SOAH" from proposed sec.80.119(d) to make it clear that the section does not restrict the judge in a contested case proceeding to the use solely of SOAH mediators. The commission agrees, and has amended the proposed subsection accordingly. The subsection has also been combined with proposed sec.80.119(c), to make the section shorter and more clear. One commenter suggested combining proposed sec.80.127(a)(2) and (c) to eliminate duplication. The commission agrees, and has amended the proposed section and renumbered subsections accordingly. One commenter suggested that proposed sec.80.127 be revised to more closely track the provisions of Texas Rule of Civil Procedure 267 and Texas Rule of Evidence 613, which prohibit the exclusion from the hearing room when "the rule" is invoked of an officer or employee of a party that is not a natural person and who is designated as its representative by its attorney and a person whose presence is shown by a party to be essential to the presentation of its case. The commission agrees, and has added subsection (f) to the proposed section so that it will more closely track the practice in the courts. One commenter suggested amending proposed sec.80.133 to allow the judge to set a schedule for the submission of written briefs. The commission agrees, and has amended the proposed section accordingly. Two commenters suggested that proposed sec.80.137 be amended to incorporate by reference Texas Rule of Civil Procedure 166a, because of the substantial body of interpretive case law and legal commentary available. The commission agrees that Rule 166a contains valuable guidance, and has tried to track the language of the rule in the proposed section as far as it considers appropriate given the difference between the administrative and judicial processes and the commission's assumption that the most likely use of the proposed section will be to limit issues, rather than to dispose of applications. The commission has accordingly modified the proposed section to track Rule 166a more closely, and anticipates that practitioners and judges will look to Rule 166a and the decisions construing it for guidance. Two commenters suggested that proposed sec.80.137 be amended to change some language relating to testimonial evidence. Because of the amendments noted previously, the commission believes the issue raised by this language to be resolved and declines to make further changes. One commenter suggested that proposed sec.80.151 be amended to expressly refer to Texas Rule of Civil Procedure 215. The commission disagrees, and declines to change the proposed section, because it believes that the grant of authority in Texas Government Code, sec.2003.047 and the sanctions provisions of proposed sec.80.107 already make sufficient provision for sanctions for discovery abuse. One commenter suggested that proposed Subchapter E of Chapter 80 (the "Freeze Rules") be deleted. While the commission recognizes the commenter's concern, it feels that the "freeze rules" have not yet been given a real test in practice, and is inclined to amend, rather than repeal them. The commission has corrected an incorrect reference in proposed sec.80.205 to refer to sec.80.105, rather than sec.80.60. Several commenters suggested that proposed sec.80.203(a)(1) be amended so that it does not require the executive director to prepare a draft permit if the executive director does not recommend the issuance of a permit. The commission disagrees, and declines to make this change, in part because the "freeze rules" were the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome, and in part because the failure to prepare a draft permit would present an almost insuperable barrier to an applicant should the applicant prevail on the issue of whether or not a permit should be issued. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.207(c) be amended to eliminate the additional time proposed beyond the first discovery period for filing a list of issues. The commission disagrees, and declines to make this change. An earlier version of this rule required protestants to have their issues list finished simultaneously with the end of the first discovery period, which the commission believes compresses the work that must be done. The commenter suggested that in the event the additional time remained, additional time should be added to proposed sec.80.207(e) as well. The commission disagrees and declines to make this change, since additional time is already granted by timing the applicant's response from the time the first list of issues is submitted, rather than the close of the first discovery period. Several commenters commented that proposed sec.80.207(d) allows an applicant to disrupt the work required of protestants to comply with subsection proposed sec.80.207(c), and suggested the deletion of the second sentence in subsection (d). The commission disagrees, and declines to make this change. The commenters apparently missed the time extension given in proposed sec.80.207(c), which now allows for completion of the issues list "within 20 days after the end" of the time period originally contained in old sec.265.104, from which the proposed section is derived. The result of the proposed sections is to give the protestant an additional 20 days to complete the issues list, while allowing the applicant to go forward with discovery. The result, rather than an additional burden on the protestant, is an easing of requirements. One commenter suggested that proposed sec.80.207(h) be amended to allow a limited amendment of the application in some circumstances. While the commission agrees that this commenter's point has some merit, the current arrangement was the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.209(c)(3) be amended to require the judge to distribute a prehearing order within four days from the prehearing conference. While the commission recognizes the commenter's concern and the limited (14-day) time period between the prehearing conference and the hearing, it prefers at this time to leave the timing of the prehearing order to the judge, trusting that prehearing orders will be distributed as soon as possible considering the compressed time frame. Two commenters suggested that proposed sec.80.213 be revised to make it clear that paragraph (1)(A) and (B) is not mutually exclusive and that the judge may direct a party to both voluntarily reduce its listed witnesses and provide a summary of the expected testimony of each witness. One commenter also suggested that the language of the rule be made more clear that the judge may prohibit testimony of witnesses. The commission agrees, and has amended the section accordingly. Several commenters suggested that proposed sec.80.259 be revised to eliminate a provision that would allow a judge to file an amended proposal for decision without serving it on the parties. This provision was included in a redline/strikeout version of the proposed rules distributed by agency staff during the rulemaking process, but was dropped from the proposed rule before publication, and thus no revision to the proposed rule is necessary. The staff regrets any inconvenience caused by failing to notify interested persons of the change before publication. The commission has amended proposed sec.80.263 to make it clear that the general counsel may set time limits for oral presentations before the commission. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.sec.80.265, 80.267, and 80.271 to remove the word "final" where it refers to commission decisions or orders, because the use of the word in these proposed sections may be unintentionally confusing when compared with the use of the word in Government Code, sec.sec.2001.141-2001.144, dealing with when decisions become final. One commenter suggested that the provision of proposed sec.80.267(b) that the commission will render a decision within 60 days after the date the hearing is finally closed does not give the commission enough time to render its decisions. The commenter suggested lengthening the time period to 90 days. The commission agrees that cases heard by a judge may take more than 60 days, but notes that the 60-day period is mandated by Texas Government Code, sec.2001. 143 unless extended. The commission believes, however, that proposed sec.80. 267(b) gives the judge enough flexibility to extend the time, and therefore declines to make the suggested revision. The commission has amended proposed sec.80.277 to more clearly reflect the commission's position and longstanding agency practice that the executive director or an authorized representative may forward an enforcement order to the attorney general for enforcement. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.86.18(c)(1)(C) to change the time period for filing applications for rehearing to 30 days to be consistent with Water Code, sec.11.316. One commenter suggested that the definition of "monitoring well" in proposed sec.340.2 be amended to expressly exclude monitoring wells used in conjunction with the production of coal and lignite, as is apparently intended by the general exclusion for wells used in conjunction with the production of "other minerals." The commission agrees, and has amended the section accordingly. One commenter noted that proposed sec.340.73 appears to differ from the requirements under discussion at the agency for sec.338.31 and sec.338.32 as to the persons to whom copies of well logs are to be submitted. The commission agrees, and has amended proposed sec.340.73 and sec.340.75 to add local underground water conservation districts and make these sections consistent. Subchapter A. Purpose, Applicability, and Definitions 30 TAC sec.50.2 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606779 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 239-1966 Subchapter B. Action on Applications 30 TAC sec.sec.50.13, 50.15, 50.17 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.50.13. Action on Application. After the time for filing a hearing request as provided in sec.55.21(d) of this title (relating to Requests for Contested Case Hearings),the commission may act on an application without holding a contested case hearing when: (1) no timely hearing request has been received; (2) all timely hearing requests have been withdrawn or denied by the commission; or (3) a judge has remanded the application because of settlement. sec.50.17. Commission Actions. (a) The commission may grant or deny an application in whole or in part, suspend the authority to conduct an activity or dispose of waste for a specified period of time, dismiss proceedings, amend or modify a permit or order, or take any other appropriate action. (b) For applications involving hazardous waste under the TSWDA, the commission may issue or deny a permit for one or more units at the facility. The interim status of any facility unit compliant with the provisions of Texas Health and Safety Code, sec.361.082(e) and sec.335.2(c) of this title (relating to Permit Required) for which a permit has not been issued or denied is not affected by the issuance or denial of a permit to any other unit at the facility. (c) If the commission directs a person to perform or refrain from performing any act or activity, the order shall set forth the findings on which the directive is based. The commission may set a reasonable compliance deadline in its order in which to: (1) terminate the operation or activity; (2) cease disposal, handling, or storage of any waste; (3) conform to the permit requirements, including any new or additional conditions imposed by the commission; or (4) otherwise comply with the commission's order. (d) For good cause, the commission may grant an extension of time to a compliance deadline upon application by the permittee. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606780 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter C. Action by Executive Director 30 TAC sec.sec.50.31, 50.33, 50.35, 50.37, 50.39, 50.41 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.50.31. Purpose and Applicability. (a) The purpose of this subchapter is to delegate authority to the executive director and to specify applications on which the executive director may take action on behalf of the commission. (b) This subchapter applies to applications for new permits, or to renew, modify, amend, correct, endorse, or transfer permits and to applications seeking orders that have the effect of issuing, renewing, modifying, amending, or transferring permits. Except as provided by subsection (c) of this section, this subchapter applies to: (1) air quality permits under Chapter 116 of this title (relating to Control of Air Pollution by Permits for New Construction or Modification); (2) appointments to the board of directors of districts created by special law; (3) certificates of adjudication; (4) certificates of convenience and necessity; (5) district matters under Chapters 49 - 66 of the Water Code; (6) districts' proposed impact fees, charges, assessments, or contributions approvable under Local Government Code, Chapter 395; (7) extensions of time to commence or complete construction; (8) industrial and hazardous waste permits; (9) municipal solid waste permits; (10) on-site waste water disposal system permits; (11) radioactive waste or radioactive material permits or licenses; (12) rate matters for water and wastewater utilities under Texas Water Code, Chapters 11, 12, or 13; (13) underground injection control permits; (14) water rights permits; (15) wastewater permits; (16) weather modification measures permits; (17) driller licenses under Texas Water Code, Chapter 32; (18) pump installer licenses under Texas Water Code, Chapter 33; (19) irrigator or installer registrations under Texas Water Code, Chapter 34; and (20) municipal management district matters under Local Government Code, Chapter 375. (c) This subchapter does not apply to: (1) air quality standard permits under Chapter 116 of this title; (2) air quality permits under Chapter 122 of this title; (3) air quality standard exemptions; (4) consolidated proceedings covering additional matters not within the scope of subsection (b) of this section; (5) district matters under Texas Water Code, Chapters 49-66, as follows: (A) an appeal under Texas Water Code, sec.49.052 by a member of a district board concerning his removal from the board; (B) an application under Texas Water Code, Chapter 49, Subchapter K, for the dissolution of a district; (C) an application under Texas Water Code, sec.49.456 for authority to proceed in bankruptcy; (D) an appeal under Texas Water Code, sec.54.239, of a board decision involving the cost, purchase, or use of facilities; (E) an application for the creation of a district; or (F) an application for approval to impose a standby fee; (6) emergency or temporary orders or temporary authorizations; (7) actions of the executive director under Chapters 101, 111, 112, 113, 114, 115, 117, 118, and 119 of this title (relating to General Rules; Control of Air Pollution From Visible Emissions and Particulate Matter; Control of Air Pollution From Sulfur Compounds; Control of Air Pollution From Toxic Materials; Control of Air Pollution From Motor Vehicles; Control of Air Pollution From Volatile Organic Compounds; Control of Air Pollution From Nitrogen Compounds; Control of Air Pollution Episodes; and Control of Air Pollution From Carbon Monoxide); (8) all municipal solid waste facilities authorized to operate by registration under Chapter 330 of this title; (9) all compost facilities authorized to operate by registration under Chapter 332 of this title; (10) concentrated animal feeding operations (CAFOs) under Chapter 321, Subchapter K of this chapter (relating to Concentrated Animal Feeding Operations); (11) impact fee petition under Local Government Code, Chapter 395; and (12) interwatershed transfers under Texas Water Code, sec.11.085. sec.50.39. Motion for Reconsideration. (a) The applicant, public interest counsel or other person may file with the chief clerk a motion for reconsideration of the executive director's action on an application. (b) A motion for reconsideration must be filed no later than 20 days after the signed permit, approval, or other written notice of the executive director's action is mailed to the applicant. In addition to a specific motion for reconsideration, the commission shall consider as a motion for reconsideration any objection, protest, or hearing request filed with the chief clerk after the filing deadline for hearing requests and not later than 20 days after the date the signed permit, approval, or other written notice of the executive director's action is mailed to the applicant. (c) An action by the executive director under this subchapter is not affected by a motion for reconsideration filed under this section unless expressly ordered by the commission. (d) Extension of time limits. With the agreement of the parties or on their own motion, the commission or the general counsel may extend the period of time for filing motions for reconsideration and for taking action on the motions so long as the period for taking action is not extended beyond 90 days after the date the signed permit, approval, or other written notice of the executive director's action is mailed to the applicant. (e) Disposition of motion. (1) Unless an extension of time is granted, if a motion for reconsideration is not acted on by the commission within 45 days after the date the signed permit, approval, or other written notice of the executive director's action is mailed to the applicant, the motion is denied. (2) In the event of an extension, the motion for reconsideration is overruled by operation of law on the date fixed by the order, or in the absence of a fixed date, 90 days after the date the signed permit, approval, or other written notice of the executive director's action is mailed to the applicant. (f) Section 80.271 of this title (relating to Motion for Rehearing) and Texas Government Code, sec.2001.146, regarding motions for rehearing in contested cases do not apply when a motion for reconsideration is denied by commission action or under subsection (e) of this section and no motions for rehearing shall be filed. If applicable, the commission decision may be subject to judicial review under Texas Water Code, sec.5.351, or the Texas Health and Safety Code, sec.sec.361.321, 382.032, or 401. 341. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606781 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Chapter 55. Request for Contested Case Hearings The commission adopts new sec.sec.55.1, 55.3, 55.21, 55.23, 55.25, 55.27, 55.29, and 55.31, concerning procedural rules. Sections 55.21, 55.23, 55.25, 55.27, 55.29, and 55.31 are adopted with changes to the proposed text as published in the March 19, 1996, issue of the Texas Register (21 TexReg 2131). Sections 55.1 and 55.3 are adopted without changes and will not be republished. Section 55.33 has been withdrawn by the commission. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. Comments were received from Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts. Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts generally supported the adoption of the proposed sections with some changes. Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund, while apparently not opposing the adoption of the proposed sections as a whole, generally expressed concerns related to public participation and issues related to delegated federal programs. A number of commenters suggested minor editorial, typographical, and grammatical changes to clarify or shorten the proposed sections. The commission generally agrees with these suggestions, and has amended the proposed sections accordingly. These changes have been made to proposed sec.sec.1.1, 1.5, 1.7, 1.10, 1.11(a), 3.2, 5.3, 5.8, 5.10, 5.11, 5.12, 5.14, 10. 1, 10.2, 10.3, 10.6, 10.8, 20.17, 40.5, 40.6, 40.8, 40.9, 50.13, 50.17, 50.31, 55.21, 55.23, 55.25, 55.27, 55.29, 55.31, 70.2, 70.3, 70.4, 70.5, 70.6, 70.7, 70.8, 70.9(b), 70.10, 70.11, 70.101, 70.102, 70.104, 70.107, 70.108, 70.109, 80.3, 80.11, 80.17, 80.21, 80.23, 80.29, 80.31, 80.33, 80.109, 80.111, 80. 113(c), 80.115, 80.119, 80.127, 80.133, 80.155, 80.201, 80.205, 80.207, 80.209, 80.213, 80.251, 80.253, 80.257, 80.265, 80.267, 80.271, 86.1, 86.11, 86.15, 86.16, 86.34, 86.55, 86.96, 86.98, 86.99, 86.130, 86.131, 86.132, 340.41(b), 340.43(d), 340.45, 340.53(d), 340.71, 340.73, and 340.131. The titles of proposed sec.sec.10.9, 20.19, 40.5, 40.6, 40.8, 50.39(e), 55.31, 70.109, 80.5, 80.23(b), Chapter 50, Subchapter B and Chapter 86, Subchapter D have also been amended for clarity and to reflect their true content. Several commenters commented generally that the proposed sections limit public participation in permit and enforcement actions more stringently than allowed under federal law and do not meet the minimum requirements for federal program approval, basing this comment in part on a draft report prepared by one of the commenters. The commission disagrees. The commenters very narrowly construe the concept of public participation, and the commission does not agree that the statistics contained in the draft report are accurate. The commission does not agree that such a narrow emphasis on contested case evidentiary hearings at the expense of other methods of public participation is either fair or appropriate. The commission also does not agree that the proposed sections impose new limits on public participation. Although the commission's process will be continually reviewed and improved, the process and the proposed sections are consistent with the "United States Environmental Protection Agency's (EPA) Policy Statement of Public Participation," which contains no requirement for contested case hearings on every permitting matter. Public notice is given in compliance with statutory requirements, and when questions or comments from the public are received, the agency's technical staff responds to them. Agency permit engineers and attorneys spend a considerable amount of time answering questions from the public, meeting with them, educating citizens on both the scientific and legal requirements of permits. As questions are raised, staff reconfirms the review and position it is taking on permits. When there is considerable public interest expressed, the agency often will hold one or more public meetings in the local area to encourage give and take between the public, the applicant, and the staff. This is in addition to public meetings that may be required by statute (e.g., Texas Health and Safety Code, sec.361.0791, on hazardous waste management permits). Most importantly, the commenters overlook the provisions of the proposed sections which in fact dramatically increase the opportunity for public participation-now, every motion for reconsideration of an executive director's action goes directly to the commission, and every hearing request is placed on a commission meeting agenda with the right of the requestor to share information and concerns directly with the three commissioners. Most determinations on hearing requests, prior to September 1, 1995, were handled by the Office of Hearing Examiners with little, if any, involvement by the commissioners. The public now has the ability to submit information and concerns to the commissioners, very often has the ability to personally address the commissioners, and the commissioners have the ability to require the applicant and the executive director's staff to respond to those concerns. The exchange takes place in a posted, public hearing. This satisfies the "exchange of views and open exploration of issues, alternatives, and consequences" standard contained in the EPA Policy Statement. Although the commission believes that the proposed sections represent a dramatic improvement, the commission continues to explore ways to enhance this exchange of views. Several commenters suggested that the commission failed to provide notice of the procedural rule changes to the EPA as required. The commission disagrees. The commenters erroneously interpret 42 United States Code, sec.300h- 1(b)(1)(A)(ii) to require notice prior to final adoption of this rule package. Correctly read, the statute only requires notice of a rule change to the EPA after final adoption of an underground injection well program or changes to the program. Upon adoption of this package, the commission will provide appropriate notice to the EPA. One commenter suggested that proposed sec.1.1 be expanded to address both the purpose and scope of the commission's rules. The commission disagrees with this proposal because the language proposed would state what is already law, that the rights of parties and the commission's powers are established by statute and cannot be enlarged by rule, and that the statutes prevail if the commission's rules are in conflict with them. Several commenters criticized the commission's handling of confidential documents under current rules being revised and adopted as proposed sec.1.5. The commission disagrees with these comments because the commission's management of confidential documents complies with all applicable requirements. Another commenter proposed additional language for this section which would specify the duties of the agency's central records office. The commission disagrees, because the proposed directives concerning internal office procedure can be made without adopting the directives as a rule. The commission notes that it has recently directed its executive director to evaluate the agency's record management practices. This evaluation is already under way, and will include the agency's handling of confidential documents to ensure they are not inadvertently disclosed to the public. A request for proposal has been published for a study on the matter. One commenter suggested that proposed sec.1.11 be amended to make it clear what is included in the phrase "courier-receipted delivery service." The commission believes that the phrase is sufficiently clear, and declines to add any definition beyond that already provided in Texas Rule of Civil Procedure 21a. The commission believes that the modifications to proposed sec.1.11 described as follows may also resolve the commenter's concerns. One commenter noted that proposed sec.1.11 and sec.10.10 appear to be missing subsection (e), which appears in old sec.261.18, from which they are derived. The commission agrees. This deletion was inadvertent, since proposed sec.1.11 and sec.10.10 were intended to include the provisions of old sec.261.18. Proposed sec.10.10 duplicates proposed sec.1.11 and has been deleted, and subsection (e) has been added to proposed sec.1.11. In addition, the commission has further clarified proposed sec.1.11 by more closely tracking Texas Rule of Civil Procedure 21a, which the commission believes covers the same subject matter more completely, and has amended and renumbered subsections accordingly. One commenter suggested that proposed sec.3.2 be revised to incorporate several definitions currently contained in other chapters. The commission agrees in part, and has added definitions of "enforcement action" and "enforcement order" to proposed sec.3.2. Other definitions not moved are used only in single chapters, and the commission believes it more useful to leave those definitions in the chapter to which they apply, rather than move them to a general definitions section. The commission intends, however, to continue to consolidate widely used definitions in Chapter 3 for clarity and consistency. One commenter suggested that the definition of "advisory committee" in proposed sec.5.2 be condensed. The commission agrees, and has amended the proposed section accordingly. This commenter also suggested that this definition be moved from proposed sec.5.2 to proposed sec.3.2. Since this term seems to be used only in proposed Chapter 5, the commission disagrees and has left the definition in proposed sec.5.2. One commenter suggested that proposed sec.10.7 be amended to clarify that the commission will keep a certified agenda of closed meetings held in accordance with the requirements of the Texas Open Meetings Act. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.10.9 and sec.10.10 duplicate proposed sec.1.10 and sec.1.11, and suggested that the proposed sections appear only in proposed Chapter 1. The commission agrees, and has deleted proposed sec.10.10 and amended proposed sec.10.9 to change its title and refer to proposed sec.1.10 and sec.1.11. One commenter suggested that proposed Chapter 40 be amended to allow participation in Alternative Dispute Resolution (ADR) by "interested parties" and to allow mediation to occur before a request for hearing is made. While the commission wholeheartedly supports ADR efforts, it disagrees for two reasons, and declines to make the change. First, participation in ADR in contested cases must necessarily be limited to the parties to the case, or at the hearing request stage, to those filing hearing requests as well. Without this limitation, the commission believes it will be difficult for participants to commit to a process where the number and identity of negotiating parties is subject to change. Second, while the commission is strongly committed to ADR, and encourages its use at all stages of the application process, it believes that it is wiser to continue to encourage informal ADR outside of agency rules prior to entry into the contested case process, and leave its use up to the participants, rather than attempt to promulgate rules governing its use at this time. One commenter suggested that the definition of the term "alternative dispute resolution office" in proposed sec.40.2 be replaced with a definition of the term "alternative dispute resolution director" because the latter is used throughout proposed Chapter 40. The commission agrees, has amended the proposed section accordingly, and has also amended proposed sec.40.5(a)(1) accordingly. One commenter suggested deleting the words "regardless of which ADR method is used" from the definition of "mediator" in proposed sec.40.2, as not adding to the definition. The commission disagrees, because it believes that the term "mediator" is used in some circles as a term of art to refer only to a person engaged in specific dispute resolution procedures, and the term is used in these proposed sections in a more inclusive manner. One commenter suggested using the word "applicant" rather than a longer term in the definition of "participant" in proposed sec.40.2, and adding "named parties" to the definition to make clear that they are included in the definition. The commission agrees, and has amended the proposed section accordingly. One commenter suggested deleting the words "from the pool of mediators" from the first sentence of proposed sec.40.4(a) and adding clarifying language regarding private mediators, to make the proposed section more consistent with the other proposed sections of the chapter. The commission agrees, and has amended the proposed section accordingly. One commenter suggested rewording proposed sec.40.4(c) for brevity and clarity. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.40.6 could be read to exclude the possibility of a matter being referred to ADR after a draft permit is proposed and a protest letter received, but prior to the matter being referred to the State Office of Administrative Hearings (SOAH), as proposed sec.55.25(d)(1) anticipates, and suggested amending the proposed section. The commission agrees with the commenter that this can be the most productive period for ADR, expressly desires to encourage ADR at this point, and has amended the proposed section to make it clear that cases may be referred to ADR at this point and that ADR outside of the commission process may be used at any time. Several commenters commented that proposed sec.50.13 and sec.50.33 allow the commission and its executive director to act on an application without considering any comments, and generally maintain that the proposed sections of procedural rules as a whole preclude public comment. The commenters also claim that the provisions of proposed sec.50.33 which prevent action by the executive director where there is a "protest" and the provision for motions for reconsideration are not an adequate substitute for a public comment process. The commission disagrees, and declines to amend the proposed sections. Proposed sec.50.13 and sec.50.33 allow action without a contested case hearing, which is not equivalent to action without considering comments. The procedures contained in the proposed procedural rules sections are, for the most part, in addition to the commission's public comment process, rather than a substitute for them, as the commenters apparently assume, and the equation of participation in a contested case hearing with public comment is inappropriate. The commission actively encourages public participation, and has gone on record repeatedly to express this and to broaden public participation, but believes that the amendments suggested by the commenters go far beyond the scope of this rulemaking. One commenter suggested that proposed sec.50.39 be amended to allow only an "affected person" to file a motion for reconsideration of an executive director's action on an application, suggesting that the term "other person" is too broad. The commission disagrees, and declines to change the proposed section, because the proposed language gives the commission flexibility to reconsider decisions in situations where the error complained of merits attention regardless of who raises it. Additionally, allowing any person to file a motion for reconsideration allows another avenue for public comment by bringing concerns directly to the attention of the commission. The commission believes, however, that the question of whether a person filing a motion for reconsideration is an affected person will in some cases have a bearing on whether the commission acts on the motion. Several commenters criticized proposed sec.55.21(b) and (d), claiming that because of multiple publications, it may be difficult to tell when the deadline for a hearing request occurs. While much of the timing and many of the contents of notices are specifically required by statute, to the extent that this becomes a problem, the commission plans to deal with it in rulemaking on a new proposed chapter governing public notice, rather than in this rulemaking. Several commenters suggested that proposed sec.55.21(c) constitutes an unlawful delegation and allows the person who designs a notice to decide what will be required in a hearing request. The commenters further assert that the proposed section does not adequately plan for errors in the published notice. The commission disagrees, and declines to change the proposed section. The statutes and other sections of the commission's rules dictate the content of public notices, and this proposed section merely requires hearing requests to comply with those requirements, if any. If the notice is defective, this must be generally cured through republication, thus giving another chance to comply with any requirements. Several commenters criticized proposed sec.55.21(e) for not establishing procedures for requesting extensions of time and suggested the inclusion of a "good cause" or public interest test. The commission disagrees. This section is primarily intended to allow the commission to consider late hearing requests. The commission believes that the proposed section allows more flexibility for the commission and the public than the suggestion does, and declines to change the section. One commenter suggested that proposed sec.55.23(b) be revised to require a group or association to provide an explanation of its hearing request with sworn affidavits, written resolutions, or other satisfactory documentation, rather than to allow other parties to request such an explanation. The commission disagrees. While the proposed sections anticipate that a group or association will submit such information, requiring this as an absolute requirement in advance when the group or association's qualifications are not in dispute is burdensome and unnecessary. However, allowing the listed parties to request that evidence, if they believe it to be an issue, protects the integrity of the hearing process and the rights of the applicant while limiting evidence and testimony to those issues that are actually in dispute. Several commenters suggested that proposed sec.55.23(b) and sec.55.26(f) place unreasonable burdens on the public in replying to responses to hearing requests. There is no proposed sec.55.26 and the latter reference is apparently to proposed sec.55.25(f). The commission disagrees, because these proposed sections merely provide a way for the commission and other parties to determine the basis of a hearing request, which is clearly relevant under Texas Water Code, sec.5.115. While the commission does not agree that the proposed time periods are unreasonable, it has determined that the time for replying to responses to hearing requests in proposed sec.55.25(f) should be lengthened from ten days to 14 days to give requestors more time to prepare, and has amended proposed sec.55.25 accordingly. Several commenters suggested that the commission amend proposed sec.sec.55.25, 55.27, 55.29, and 55.31, to change the way the commission deals with hearing requests and with determinations of whether a person is an "affected person," whether a request is "reasonable," and what constitutes "competent evidence" under Texas Water Code, sec.5.115. The commission agrees that these items may need further attention, but, as announced at the beginning of this phase of rulemaking and stated in the preamble to these proposed rules, has reserved this issue for further rulemaking, once sufficient experience has been accumulated with the existing process to fairly evaluate how well the existing rules are working. This project is already underway at the agency, and the commission expects that it will get into full swing shortly after this rulemaking project is concluded. While some minor adjustments to the current process are included in this round of rulemaking, the commission declines to make the suggested major changes in this round of rulemaking. Several commenters suggested that the proposed sections place an unreasonable burden on who can qualify for a hearing and claimed that the commission has not implemented its authority to provide for public participation in hearings. The commission disagrees. As noted previously, the commission believes that the proposed sections broadly encourage public participation. In addition, the proposed sections are entirely consistent with the law on hearings and standing. Finally, the commission is already committed to reviewing this process in another round of rulemaking. Several commenters suggested that proposed sec.55.25(g) be revised to allow a legislator (for an activity in the legislator's district), a state agency, a federal agency, or a local government (for a facility within the local government's jurisdiction) to send an application directly to SOAH for a contested case hearing. The commission disagrees. Nothing in the statutes grants such blanket rights, and the commission believes that adding this provision would violate both the letter and intent of Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115, as well as other specific statutes dealing with contested case hearings, and therefore declines to make this change. One commenter noted that the provisions of proposed sec.55.27 and sec.55.29 do not appear to address instances where the definition of affected persons in the rule (and in Texas Water Code, sec.5.115) may differ from specific statutory provisions defining "affected person" or "person affected," and suggested that the proposed sections be revised to make it clear that specific statutory provisions control. In the alternative, the commenter suggested that the commission apply both the definition of "affected person" in the proposed sections and any specific statutory definition. The commission agrees with the commenter that Texas Water Code, sec.5.115, the proposed sections, and other specific statutes can and should be read together. Generally, Texas Water Code, sec.5.115 will require a "personal justiciable interest," while other specific statutory provisions delineate those interests, specifying distance limitations or identifying specific persons who can request a hearing. The commission believes that the provisions of proposed sec.55.27 (that a hearing request be granted if it is "pursuant to a right to hearing authorized by law") and proposed sec.55.29 (that a relevant factor in determining whether a person has "a personal justiciable interest related to a legal right, duty, privilege, power, or economic interest affected by the application" is "whether the interest claimed is one protected by the law under which the application will be considered") require Texas Water Code, sec.5.115 and any applicable specific statute to be read together. Thus, the commission declines to modify the proposed sections. Several commenters suggested that proposed sec.55.27(b) and (c) be amended on the grounds that they conflict with statutory provisions such as Texas Water Code, Chapter 27, in which counties are granted hearings regardless of a showing of standing or reasonableness of their hearing requests. The commenters also suggested that the test for a state agency or local government needs to be clarified, alleging, for example, that a county is automatically an affected person for an activity in that county. The commission disagrees. No statute, other than those giving party status to the executive director, public interest counsel, Texas Water Development Board, and Texas Parks and Wildlife Department, provides as a blanket rule that a governmental entity is automatically an affected person for all activities in a geographic area, although some do in specific instances. Texas Water Code, sec.27.018, for instance, provides for a hearing on an injection well permit application if one is requested by a "local government." The statute further distinguishes between the terms "local government" and "affected person"-a distinction that does not appear in Texas Water Code, sec.5.115. While there may be some confusion over the use of the term "affected person" in more than one context, the commission believes that it is clear that a hearing request by a local government under Texas Water Code, sec.27.018 meets the tests of reasonableness and being "pursuant to a right to hearing authorized by law" under proposed sec.55.27(b) and "in the public interest" under proposed sec.55.27(c), and that a governmental entity may be an affected person given the definition of "person" contained in proposed sec.3.2 and its "authority under state law" in proposed sec.55.29(b). The commission further believes that the tests for a state agency or local government are sufficiently clear, and therefore declines to amend the proposed sections. Two commenters suggested that the provisions of proposed sec.55.27(c), which allow the commission to refer an application to SOAH for hearing if the commission determines that a hearing would be "in the public interest" even if there is no valid hearing request, be deleted or that the commission delineate standards it will use in making this determination. Several commenters suggested that the provision is vague in that it does not define "public interest." The commission disagrees with these comments and declines to make the suggested changes, in that it believes that there may be situations where the public interest demands a hearing (one example might be information received after the deadline for hearing requests), and also believes that it would be impossible to define "public interest" at this time in terms more specific than those used by the statutes under which the commission operates. One commenter suggested that proposed sec.55.27(c) be deleted as duplicative of proposed sec.55.27(b)(1). The commission disagrees and declines to make the proposed change. Proposed sec.55.27(b)(1) allows a commissioner, an applicant, or the executive director to request a contested case hearing and thereby refer a case to SOAH, while proposed sec.55.27(c) allows the commission as a whole to vote to send a case to SOAH. The two provisions serve different purposes and the commission believes they should be kept separate. Several commenters suggested that the commission's rules on notice need significant changes, and suggested that proposed sec.55.27(c) be amended to prohibit the final notice on a permit from being issued before technical review is complete and a draft decision is available. The commission does not agree that these proposed sections are the place to deal with notice requirements, notes that no notice has been given to the public or interested parties that notice requirements would be changed in these proposed sections, and points out that it is in the process of preparing for publication a new chapter to consolidate many of its notice rules. However, the commission disagrees with the commenters that the existing rules regarding notice are inadequate or restrict public participation. Proposed sec.55.27(c) does not deal with notice, but rather allows the commission to refer an application to SOAH even if there is no hearing request, and the commission does not agree that amending it to deal with notice would be appropriate or advisable. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear whether an administrative law judge can overrule a commission denial of a hearing request based on standing. The commission has amended proposed sec.55.27(f) to make its position on this issue more clear-that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear what must be done to appeal the denial of a hearing request, do not make it clear when the time period for appeal begins to run, and add new burdens by requiring two appeals. The commission does not agree, and declines to further amend the proposed sections beyond the amendments already described. The proposed sections make it clear that a party whose hearing request is denied must seek to obtain party status and then, if unsuccessful, follow procedures for a motion for rehearing as a prerequisite to appeal once the commission has disposed of the application. Since a person who files a hearing request is asking that a contested case hearing be held, that party obtains the relief sought if any hearing request is granted. That person must then seek to be admitted as a party if the person wishes to participate in the case, and decisions on that issue will be handled as they are now, although the commission anticipates that if the person has a complaint at this point, it will be the denial of party status or a limitation of issues rather than a determination on a hearing request. If all hearing requests are denied or withdrawn, persons whose requests are denied have an opportunity for the review of that decision by filing a motion for rehearing after the commission's decision on the application -that is, at the end of the case, rather than in an interlocutory appeal, as the commenters seem to suggest. The commission believes that it is clear in the proposed sections that the time period for appeals begins to run at this point. While the commenters also suggest that it is unreasonable to force parties to go through a hearing and have the result of that hearing reversed by a court based on an error in denying party status, the commission believes that the risk of this kind of result is minimal, is inherent in every determination of party status in any kind of proceeding, and is outweighed by the burden to the public that would be imposed by delaying every permitting decision until determinations of party status are appealed through the court system. Two commenters noted that proposed sec.55.27(f) allows a person whose hearing request is denied to still seek to be admitted as a party, and suggested that absent some compelling reasons, the commission's determination on the hearing request should preclude the later admission of the person as a party. The commission disagrees, and has amended the proposed section as noted previously to make it clear that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. One commenter suggested that proposed sec.55.27 be amended to allow a motion for reconsideration, rather than a motion for rehearing, of the denial of a hearing request, suggesting that the latter is only appropriate in contested cases under the Administrative Procedure Act, and that no contested case arises if a hearing request is not granted. The commission disagrees. As stated previously, the commission believes that a decision on the validity of a hearing request is an interlocutory decision only on the validity of the request, and does not necessarily dictate the outcome of a later decision on party status, or standing. The commission believes that a motion for rehearing at the conclusion of the proceedings is the most appropriate way to review such a decision. Several commenters remarked that the proposed sections do not allow for an adequate record for judicial review when no contested case hearing is held and do not establish standards for a court to use in its review. The commenters also suggest that the proposed sections do not create an adequate record in rulemaking. The commission disagrees, and declines to make changes based on this comment, because it believes that the record created is sufficient for judicial review of the commission's actions, and the standards of review are already clearly established in the statutes and rules. Similarly, the commission believes that the record created in rulemaking proceedings is more than adequate. Several commenters suggested that proposed sec.55.29 and sec.55.31 be revised to provide that the commission accept as true written statements of a person filing a hearing request for the purposes of the determination on the request or the person requesting a hearing be given an opportunity to present evidence to meet the burden of presenting competent evidence under Texas Water Code, sec.5.115. The commission disagrees and declines to make these changes. The first alternative ignores the clear intent of Texas Water Code, sec.5.115, by allowing a person to meet its standards by simply claiming that the standards are met. Texas Water Code, sec.5.115 provides that the commission "is not required to hold a hearing if the commission determines that the basis of the person's hearing request is unreasonable or is not supported by competent evidence." The second alternative does not recognize that this determination will require different procedures in different cases, and the flexibility which the proposed sections provide-from a decision on the pleadings to oral argument to an evidentiary hearing-allows for procedures to be followed which are appropriate for the cases presented. For example, a permit renewal under Texas Health and Safety Code, sec.382.056 may be an example of a case where requests not alleging increases in emissions or compliance problems can be dealt with on the pleadings alone. Similarly, a person who cannot allege a reasonable basis for a hearing request or who cannot allege that competent evidence exists to support the request, despite having more than one opportunity to do so (the request itself, a reply filed under proposed sec.55. 25(f) to responses that point out the merits or deficiencies of the request, and, in appropriate cases, argument or testimony before the commission) is not going to be able to present such evidence at a hearing, and it may be appropriate to resolve this request without an evidentiary hearing. Several commenters suggested that proposed sec.55.31 is unconstitutionally vague and conflicts with other Texas Natural Resource Conservation Commission rules and the law, specifically proposed sec.55.29 and Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115 and that the provisions of proposed sec.55.31(b)(3) are overly burdensome on public participation. The commission disagrees. The commission believes that the proposed section fully complies with the constitution and with Texas Health and Safety Code, sec.382. 056 and Texas Water Code, sec.5.115. The term "reasonableness" is adequately defined by proposed sec.55.31. Further, proposed sec.55.31 does not conflict with proposed sec.55.29, because they deal with different matters -the first with the determination of whether a person is an "affected person," and the second with whether a hearing request is "reasonable." Several commenters suggested that the proposed rules be revised to "provide that the commission will make determinations and record those determinations so that the public can understand the basis for its government's decision and so that a reviewing court can determine if the actions of the commission should be affirmed or reversed." As noted previously, the commission believes that the proposed sections do exactly that and declines to make changes based on this comment. Several commenters suggested that proposed sec.55.33(a)(3) (and presumably proposed sec.80.5(a)(3)) be revised, claiming that the proposed section requires the Chief Clerk to pay the cost for issuing public notices. The commission disagrees, since the proposed section requires the clerk to issue notice and does not provide for the Clerk to pay the cost of notice, since applicants are clearly responsible for those costs. Proposed sec.55.33 has been withdrawn, however, and only proposed sec.80.5 now governs the Chief Clerk's actions in this context. Several commenters noted that the setting procedures of proposed sec.55.33 largely duplicate those of proposed sec.80.5, and suggested the deletion of one or the other. Some commenters suggested conforming these two proposed sections. The commission agrees that these sections are duplicative and should be conformed, and notes as well that proposed sec.70.109 largely duplicates both of these sections. For clarity, the commission believes that it is most logical to lay out all setting procedures only in proposed Chapter 80, and has deleted proposed sec.55.33 and amended proposed sec.70.109 accordingly. Several commenters suggested that the proposed sections of proposed Chapter 70 limit public participation in enforcement proceedings in a fashion that does not meet the federal requirements for such participation and further state that notice in the Texas Register is insufficient. The commission disagrees, and declines to change the proposed sections. The agency complies with federal authorization rules regarding public participation in enforcement matters, which require the agency to have procedures in place for responding to citizen complaints, publish notice of settlements of civil actions, and give assurance that it will not oppose intervention by any citizen when permissive intervention is authorized by statute, rule, or regulation. In regard to the comment that Texas Register publication is insufficient, while the commission disagrees, it is currently considering alternative citizen participation in administrative actions. If rule changes are necessary after a decision is made on this issue, they will be taken up separate from this rulemaking. One commenter suggested that the definitions of "enforcement order," "enforcement action," "petition," and "respondent" be moved from proposed sec.70.2 to proposed sec.3.2. The commission agrees that the definitions of "enforcement action" and "enforcement order" should be moved to sec.3.2 since they are used in general context in other chapters of the agency's rules; however, the terms "petition" and "respondent," as they are defined in proposed Chapter 70, are specific to enforcement actions by the commission only and should remain in proposed Chapter 70. The commission does not believe that generic definitions of petition and respondent are necessary in proposed Chapter 3 to cover permitting matters because those terms are generally accepted legal terminology and "petition" is already included in the definition of "application." One commenter suggested that proposed sec.70.51 substantially changes old sec.337.71 from relating only to water rights enforcement matters to a more general mandatory enforcement hearing process. The commission disagrees. The language in proposed sec.70.51 was taken verbatim from old sec.337.71, except that the title of the subchapter was changed and references to other rules which had been renumbered were changed. The definitions included in old sec.337. 71 included water quality, water rights, hazardous waste releases, and references to the air statute as well. Although the title of old sec.337.71 indicated "Water Rights Enforcement," its statutory basis is Texas Water Code, sec.5.117, which applies to the agency as a whole, and requires the executive director to bring all instances of substantial noncompliance before the commission. The commenter expressed concern that proposed sec.70.51 would require mandatory hearings for incorrect compliance with record keeping requirements in an air permit. Since this would normally not be a substantial noncompliance under the air rules, this section would not apply in that case. Furthermore, old sec.337.71 and proposed sec.70.51 both exclude air violations, since a separate statutory requirement exists for the air program. The program most affected by this statutory requirement is the water quality program, which has a large amount of self-reporting data submitted each month. The proposed section basically sets forth the practice of the watershed management and enforcement divisions in processing this large volume of documents and describes how they determine what constitutes a substantial noncompliance. One commenter suggested that the concept of "executive director preliminary reports" (EDPR), used in proposed sec.70.101, is not necessary in proposed Chapter 70 and is not mandated by statute. While EDPRs are not required by statute, they are clearly allowed and anticipated by statute (see Texas Water Code, sec.sec.13.4151(c) and (d), 26.136(d) and (e), 27.1015(d) and (e), 34. 011(d) and (e) and Texas Health and Safety Code, sec.sec.341.049(c) and (d), 361. 252(d) and (e), 366.0924(d) and (e), 382.088(d) and (f), and 401.384- 401.385). This rulemaking does not alter the provisions in old Chapter 337 regarding preliminary reports, and sets forth the agency's procedures if preliminary reports are chosen as the form of pleading in a case. The executive director is not required to issue a preliminary report, but is given an option which may be used on a case-by-case basis, which is consistent with the statutory provisions. The commission disagrees with the comment and declines to change the proposed section. The commission has determined that the setting procedures of proposed sec.70. 109 largely duplicate those of proposed sec.80.5, and has amended them to simply refer to proposed sec.80.5. The commission has also amended the title of this section for clarity. One commenter suggested that proposed sec.80.3(a) be amended to make it clear that the judge sitting in a phase of a hearing, not the presiding judge, will resolve evidentiary questions raised during that phase of a hearing. The commission generally agrees, but believes that it may be necessary for a judge sitting in one phase of a hearing to refer some important evidentiary questions to the presiding judge, and has amended the section accordingly. Two commenters suggested that proposed sec.80.3(b)(10) be revised to make it clear that the judge may limit the time of presentation of evidence and witnesses without unfairly prejudicing the rights of parties. The commission agrees, and has amended the rule accordingly. In addition, the commission believes that splitting proposed sec.80.3(a) into two subsections and redesignating proposed sec.80.3(b) as sec.80.3(c) makes the proposed rule more readable, and has amended it accordingly. Two commenters suggested that proposed sec.80.5(b) be amended to expressly state that the commission may limit the issues that shall be considered by SOAH in a contested case. The commission agrees that this ability is implicit in Texas Government Code, sec.2003.047(e), and has amended the proposed section accordingly. These commenters also suggest that the proposed section be amended to provide that the commission "may," rather than "shall," identify issues to be addressed. Since Texas Government Code, sec.2003.047(e) uses "shall," the commission disagrees and declines to make this change. The commission has amended proposed sec.80.5(b) to make it clear that the executive director's petition or EDPR serves as the list of issues to be addressed by SOAH in a contested enforcement case. One commenter suggested that proposed sec.55.33(b) (the same as proposed sec.80.5(b)) be deleted, stating that while the commission may want to restrict or direct the list of issues, the proposed section suggests that a referral is not adequate if it does not. The commission disagrees, since Texas Government Code, sec.2003.047(e) clearly mandates an issues list, and since the proposed section gives the commission the flexibility to submit both broad and narrow ranges of issues. Several commenters suggested that proposed sec.80.13 be amended to allow parties, as well as the executive director, to request consolidation of related proceedings. The commission disagrees and declines to change the proposed section, because this is already allowed by the proposed sections. Proposed sec.80.13 allows the executive director to consolidate matters with the permission of the judge, and allows the judge to consolidate matters, presumably on the judge's own motion or that of any party. One commenter noted that due to changes in Chapter 291 of the commission's rules, proposed sec.80.17 does not accurately reflect the burden of proof in certain water and sewer rate cases. The commenter also noted that enforcement cases covered by subsection (c) of the rule should be expressly excepted from subsection (a). The commission agrees, and has amended the proposed section accordingly. One commenter suggested that proposed sec.80.27 be deleted as duplicative of proposed sec.sec.1.08, 1.10, 1.11, and 80.31. While the proposed sections cover similar matters, the commission disagrees and declines to make the change, because proposed sec.80.27 covers mostly matters of form, while the other proposed sections deal with more procedural matters. The commission has amended proposed sec.80.101 to make it clear that the executive director may either act on a matter remanded to the executive director or set it for consideration at a commission meeting. This is allowed by the proposed section, but the amendment lends clarity. One commenter suggested that proposed sec.80.107 is of sufficient importance that it should be dealt with as a separate subchapter. While the commission agrees that the proposed section is important, it prefers as a matter of form at this time not to create additional subchapters, and declines to make the change. One commenter suggested deleting the phrase "administrative law" from a reference in proposed sec.80.107(a)(3) to result in consistent references to the presiding officer as "judge." The commission agrees, and has amended the proposed section accordingly. One commenter suggested amending proposed sec.80.109(b) to define only statutory parties. The commission disagrees, and believes that the proposed section serves a more useful function by referring to all parties to an application, rather than just statutory parties, and declines to make this change. One commenter suggested deleting proposed sec.80.109(c) as duplicative of proposed sec.80.115. The commission agrees, and has amended the proposed section accordingly, renumbering the subsequent subsections. One commenter suggested deleting proposed sec.80.109(d) (now sec.80.109(c)) as duplicative of proposed sec.80.3(b)(5). The commission disagrees, since the section as amended in response to comments on proposed sec.80.115 now makes it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. One commenter suggested moving proposed sec.80.109(e) ((now sec.80.109(d)) to proposed sec.80.119, arguing that it makes more sense to discuss the effects of continuance in that section. The commission disagrees and declines to make the change. Proposed sec.80.109(e) (now sec.80.109(d)) is intended to make it clear that a person designated as a party retains party status regardless of any postponement of a hearing. Since the rule is limited to party status, the commission feels that it makes more sense to leave it in its present location. Several commenters commented that proposed sec.80.111 prohibits the judge and commission from considering comments. The commission disagrees, and points out that the section does not at all impair the executive director's ability to consider comments. The proposed section prohibits the judge from considering protests or comments submitted by non-parties in a non-evidentiary context (not under oath and without the opportunity to cross-examine) as evidence in contested case proceedings. The commission believes this is required by law, and declines to change the proposed section. The commission notes, however, that the phrase "[i]n proceedings other than enforcement proceedings" was inadvertently published as the end of the second sentence of this section, rather than as the beginning of the third sentence. The commission has amended the section accordingly, so that this limitation applies to questions submitted to the judge, not to the consideration of comments. One commenter noted that proposed sec.80.115 is not clear as to whether each and every party has a right to conduct discovery, present a direct case, cross- examine witnesses, obtain copies of pleadings, and so on, even when parties have been aligned under proposed sec.80.109. The commission agrees that the two provisions could be confusing when read together, and has amended proposed sec.80.109(d) to make it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. The commission anticipates that judges will exercise their best judgment when aligning parties and specifying the purposes for which they are aligned. One commenter suggested that proposed sec.80.117(b) be revised to make it clear that all persons granted party status are covered in the order of presentation. The commission agrees, and has amended proposed sec.80.117 by substituting the words "other parties" for the word "protestant." One commenter suggested deleting the word "SOAH" from proposed sec.80.119(d) to make it clear that the section does not restrict the judge in a contested case proceeding to the use solely of SOAH mediators. The commission agrees, and has amended the proposed subsection accordingly. The subsection has also been combined with proposed sec.80.119(c), to make the section shorter and more clear. One commenter suggested combining proposed sec.80.127(a)(2) and (c) to eliminate duplication. The commission agrees, and has amended the proposed section and renumbered subsections accordingly. One commenter suggested that proposed sec.80.127 be revised to more closely track the provisions of Texas Rule of Civil Procedure 267 and Texas Rule of Evidence 613, which prohibit the exclusion from the hearing room when "the rule" is invoked of an officer or employee of a party that is not a natural person and who is designated as its representative by its attorney and a person whose presence is shown by a party to be essential to the presentation of its case. The commission agrees, and has added subsection (f) to the proposed section so that it will more closely track the practice in the courts. One commenter suggested amending proposed sec.80.133 to allow the judge to set a schedule for the submission of written briefs. The commission agrees, and has amended the proposed section accordingly. Two commenters suggested that proposed sec.80.137 be amended to incorporate by reference Texas Rule of Civil Procedure 166a, because of the substantial body of interpretive case law and legal commentary available. The commission agrees that Rule 166a contains valuable guidance, and has tried to track the language of the rule in the proposed section as far as it considers appropriate given the difference between the administrative and judicial processes and the commission's assumption that the most likely use of the proposed section will be to limit issues, rather than to dispose of applications. The commission has accordingly modified the proposed section to track Rule 166a more closely, and anticipates that practitioners and judges will look to Rule 166a and the decisions construing it for guidance. Two commenters suggested that proposed sec.80.137 be amended to change some language relating to testimonial evidence. Because of the amendments noted previously, the commission believes the issue raised by this language to be resolved and declines to make further changes. One commenter suggested that proposed sec.80.151 be amended to expressly refer to Texas Rule of Civil Procedure 215. The commission disagrees, and declines to change the proposed section, because it believes that the grant of authority in Texas Government Code, sec.2003.047 and the sanctions provisions of proposed sec.80.107 already make sufficient provision for sanctions for discovery abuse. One commenter suggested that proposed Subchapter E of Chapter 80 (the "Freeze Rules") be deleted. While the commission recognizes the commenter's concern, it feels that the "freeze rules" have not yet been given a real test in practice, and is inclined to amend, rather than repeal them. The commission has corrected an incorrect reference in proposed sec.80.205 to refer to sec.80.105, rather than sec.80.60. Several commenters suggested that proposed sec.80.203(a)(1) be amended so that it does not require the executive director to prepare a draft permit if the executive director does not recommend the issuance of a permit. The commission disagrees, and declines to make this change, in part because the "freeze rules" were the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome, and in part because the failure to prepare a draft permit would present an almost insuperable barrier to an applicant should the applicant prevail on the issue of whether or not a permit should be issued. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.207(c) be amended to eliminate the additional time proposed beyond the first discovery period for filing a list of issues. The commission disagrees, and declines to make this change. An earlier version of this rule required protestants to have their issues list finished simultaneously with the end of the first discovery period, which the commission believes compresses the work that must be done. The commenter suggested that in the event the additional time remained, additional time should be added to proposed sec.80.207(e) as well. The commission disagrees and declines to make this change, since additional time is already granted by timing the applicant's response from the time the first list of issues is submitted, rather than the close of the first discovery period. Several commenters commented that proposed sec.80.207(d) allows an applicant to disrupt the work required of protestants to comply with subsection proposed sec.80.207(c), and suggested the deletion of the second sentence in subsection (d). The commission disagrees, and declines to make this change. The commenters apparently missed the time extension given in proposed sec.80.207(c), which now allows for completion of the issues list "within 20 days after the end" of the time period originally contained in old sec.265.104, from which the proposed section is derived. The result of the proposed sections is to give the protestant an additional 20 days to complete the issues list, while allowing the applicant to go forward with discovery. The result, rather than an additional burden on the protestant, is an easing of requirements. One commenter suggested that proposed sec.80.207(h) be amended to allow a limited amendment of the application in some circumstances. While the commission agrees that this commenter's point has some merit, the current arrangement was the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.209(c)(3) be amended to require the judge to distribute a prehearing order within four days from the prehearing conference. While the commission recognizes the commenter's concern and the limited (14-day) time period between the prehearing conference and the hearing, it prefers at this time to leave the timing of the prehearing order to the judge, trusting that prehearing orders will be distributed as soon as possible considering the compressed time frame. Two commenters suggested that proposed sec.80.213 be revised to make it clear that paragraph (1)(A) and (B) is not mutually exclusive and that the judge may direct a party to both voluntarily reduce its listed witnesses and provide a summary of the expected testimony of each witness. One commenter also suggested that the language of the rule be made more clear that the judge may prohibit testimony of witnesses. The commission agrees, and has amended the section accordingly. Several commenters suggested that proposed sec.80.259 be revised to eliminate a provision that would allow a judge to file an amended proposal for decision without serving it on the parties. This provision was included in a redline/strikeout version of the proposed rules distributed by agency staff during the rulemaking process, but was dropped from the proposed rule before publication, and thus no revision to the proposed rule is necessary. The staff regrets any inconvenience caused by failing to notify interested persons of the change before publication. The commission has amended proposed sec.80.263 to make it clear that the general counsel may set time limits for oral presentations before the commission. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.sec.80.265, 80.267, and 80.271 to remove the word "final" where it refers to commission decisions or orders, because the use of the word in these proposed sections may be unintentionally confusing when compared with the use of the word in Government Code, sec.sec.2001.141-2001.144, dealing with when decisions become final. One commenter suggested that the provision of proposed sec.80.267(b) that the commission will render a decision within 60 days after the date the hearing is finally closed does not give the commission enough time to render its decisions. The commenter suggested lengthening the time period to 90 days. The commission agrees that cases heard by a judge may take more than 60 days, but notes that the 60-day period is mandated by Texas Government Code, sec.2001. 143 unless extended. The commission believes, however, that proposed sec.80. 267(b) gives the judge enough flexibility to extend the time, and therefore declines to make the suggested revision. The commission has amended proposed sec.80.277 to more clearly reflect the commission's position and longstanding agency practice that the executive director or an authorized representative may forward an enforcement order to the attorney general for enforcement. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.86.18(c)(1)(C) to change the time period for filing applications for rehearing to 30 days to be consistent with Water Code, sec.11.316. One commenter suggested that the definition of "monitoring well" in proposed sec.340.2 be amended to expressly exclude monitoring wells used in conjunction with the production of coal and lignite, as is apparently intended by the general exclusion for wells used in conjunction with the production of "other minerals." The commission agrees, and has amended the section accordingly. One commenter noted that proposed sec.340.73 appears to differ from the requirements under discussion at the agency for sec.338.31 and sec.338.32 as to the persons to whom copies of well logs are to be submitted. The commission agrees, and has amended proposed sec.340.73 and sec.340.75 to add local underground water conservation districts and make these sections consistent. Subchapter A. Applicability and Definitions 30 TAC sec.55.1, sec.55.3 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606782 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter B. Hearing Requests 30 TAC sec.sec.55.21, 55.23, 55.25, 55.27, 55.29, 55.31 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.55.21. Requests for Contested Case Hearings. (a) The following may request a contested case hearing under this chapter: (1) a commissioner; (2) the executive director; (3) the applicant; (4) affected persons, when authorized by law; and (5) for applications for air quality permits, or standard exemptions required to provide public notice, a legislator from the general area of the proposed facility. (b) A request for a contested case hearing by an affected person must be filed in writing with the chief clerk within the time provided by subsection (d) of this section. (c) A hearing request must substantially comply with the following: (1) give the name, address, and daytime telephone number of the person who files the request. If the request is made by a group or association, the request must identify one person by name, address, daytime telephone number, and, where possible, fax number, who shall be responsible for receiving all official communications and documents for the group; (2) identify the person's personal justiciable interest affected by the application; (3) request a contested case hearing; and (4) provide any other information specified in the public notice of application. (d) Time to make request. A hearing request must be filed with the chief clerk within the time period specified in the notice. The time period shall be: (1) 60 days after the first publication of the notice of a Class 3 modification of a solid waste permit under the TSWDA; (2) 30 days after the second publication for a new permit or permit amendment under Chapter 116 of this title (relating to Control of Air Pollution by Permits for New Construction or Modification); (3) 15 days after the second publication for a permit renewal or standard exemption for a concrete plant under Chapter 116 of this title; (4) ten days after the mailing of notice of the application for a minor amendment or for the transfer of a permit; (5) no less than 30 days after the mailing of the notice of opportunity for hearing for an application for a municipal solid waste permit or to amend, extend, or renew such a permit; (6) no less than 30 days after the mailing of the notice of draft permit for an application for an industrial waste facility permit or to amend, extend, or renew such a permit; (7) no less than 45 days after the mailing of the notice of draft permit for an application for a hazardous waste facility permit or to amend, extend, or renew such a permit; (8) no less than 30 days after the publication of the notice of draft permit for an application for a wastewater discharge except as provided in paragraph (9) of this subsection; (9) no less than ten days after the mailing of the notice of draft permit for an application to amend a wastewater discharge permit where the application is to improve the quality of waste authorized to be discharged and does not seek to increase significantly the quantity of waste authorized to be discharged or change materially the pattern or place of discharge; (10) not less than 30 days after the publication of the notice of draft permit for an application for an injection well permit or to amend, extend, or renew such a permit; (11) not less than 30 days after the notice of draft production area authorization under Chapter 331 of this title (relating to Underground Injection Control); or (12) the time specified in commission rules for other specific types of application. (e) The commission may extend the time allowed for submitting a hearing request. sec.55.23. Request by Group or Association. (a) A group or association may request a contested case hearing only if the group or association meets all of the following requirements: (1) one or more members of the group or association would otherwise have standing to request a hearing in their own right; (2) the interests the group or association seeks to protect are germane to the organization's purpose; and (3) neither the claim asserted nor the relief requested requires the participation of the individual members in the case. (b) The executive director, the public interest counsel, or the applicant may request that a group or association provide an explanation of how the group or association meets the requirements of subsection (a) of this section. The request and response shall be filed according to the procedure in sec.55.25(e) and (f) of this title (relating to Hearing Request Processing). sec.55.25. Hearing Request Processing. (a) The chief clerk shall deliver or mail to the executive director, the public interest counsel, and the applicant copies of all documents filed with the chief clerk in response to public notice of an application. (b) The chief clerk shall respond in writing to a hearing request, protest, or other response to the notice of application to explain how the person may submit public comment to the executive director and to describe alternative dispute resolution under commission rules. (c) The executive director shall file a statement with the chief clerk indicating that technical review of the application is complete. The executive director may file the statement with the chief clerk either before or after public notice of the application is issued. (d) After a hearing request is filed and the executive director has filed a statement that technical review of the application is complete, the chief clerk shall process the hearing request by both: (1) referring the application and hearing request to the alternative dispute resolution director. The alternative dispute resolution director shall try to resolve any dispute between the applicant and the person making the request for hearing; and (2) scheduling the hearing request for a commission meeting. The chief clerk should try to schedule the request for a commission meeting that will be held approximately 40 days after the later of the following: (A) the deadline to request a hearing specified in the public notice of the application; or (B) the date the executive director filed the statement that technical review is complete. (e) The executive director, the public interest counsel, and the applicant may submit written responses to the hearing request no later than 20 days before the commission meeting at which the commission will evaluate the hearing request. Responses shall be filed with the chief clerk, and served on the same day to the executive director, the public interest counsel, the applicant, and any persons filing hearing requests. (f) The person who filed the hearing request may submit a written reply to a response no later than six days before the scheduled commission meeting at which the commission will evaluate the hearing request. A reply shall be filed with the chief clerk, and served on the same day to the executive director, the public interest counsel, and the applicant. (g) The executive director, a commissioner, or the applicant, may file a request with the chief clerk that the application be sent directly to SOAH for a hearing. If a request is filed under this subsection, the commission's scheduled consideration of the hearing request will be canceled. sec.55.27. Action on Hearing Request. (a) The commission will evaluate the hearing request at the scheduled commission meeting, and may: (1) determine that a hearing request does not meet the requirements of this subchapter, and act on the application; (2) determine that a hearing request meets the requirements of this subchapter, and direct the chief clerk to refer the application to SOAH for hearing; or (3) direct the chief clerk to refer the hearing request to SOAH. The referral may specify that SOAH should prepare a recommendation on the sole question of whether the request meets the requirements of this subchapter. The referral may also direct SOAH to proceed with a hearing on the application if the judge finds that a hearing request meets the requirements of this chapter. (b) A request for a contested case hearing shall be granted if the request is: (1) made by a commissioner, applicant, or the executive director; (2) made by an affected person if the request: (A) is reasonable; (B) is supported by competent evidence; (C) complies with the requirements of sec.55.21 of this title (relating to Requests for Contested Case Hearings); (D) is timely filed with the chief clerk; and (E) is pursuant to a right to hearing authorized by law; (3) for an air quality permit, made by a legislator in the general area of the facility if the request: (A) is reasonable; (B) complies with the requirements of sec.55.21 of this title, except for subsection (c)(2)-(4); (C) is timely filed with the chief clerk; and (D) is pursuant to a right to hearing authorized by law. (c) The commission may refer an application to SOAH if there is no hearing request complying with this subchapter, if the commission determines that a hearing would be in the public interest. (d) The executive director shall determine the sufficiency of hearing requests on utility matters listed in this subsection. If a hearing request meets the requirements in this subsection, the executive director shall refer the hearing request to the chief clerk. The executive director shall review hearing requests concerning the following matters and shall use the specified standards for reviewing the requests. (1) If a utility files a statement of intent to change rates under Texas Water Code, sec.13.187, the executive director shall evaluate any complaints or hearing requests received and determine if a hearing is required. (2) If a person files an application or petition concerning a certificate of convenience and necessity under Texas Water Code, Chapter 13, Subchapter G, the executive director shall evaluate any complaints or hearing requests and determine if a hearing is required. (3) If a person files an appeal under Texas Water Code, sec.13.043, invoking the commission's appellate jurisdiction over water, sewer, or drainage rates, the executive director shall evaluate the appeal and determine if a hearing is required. (e) During a commission meeting, the commission may determine whether the application should be processed under the requirements of Chapter 80, Subchapter E of this title (relating to Freezing the Process). The commission may consider the number and sophistication of the parties or potential parties, the expected length of the hearing, and the complexity of the issues. (f) A decision on a hearing request is an interlocutory decision on the validity of the request and is not binding on the issue of designation of parties under sec.80.109 of this title (relating to Designation of Parties). A person whose hearing request is denied may still seek to be admitted as a party under sec.80.109 of this title if any hearing request is granted on an application. Failure to seek party status shall be deemed a withdrawal of a person's hearing request. (g) If a hearing request is denied, sec.80. 271 of this title (relating to Motion for Rehearing) applies. A motion for rehearing in such a case must be filed no earlier than, and no more than 20 days after, the date the person or his attorney of record is notified of the commission's final decision or order on the application. If the motion is denied under sec.sec.80.271 and 80.273 of this title (relating to Motion for Rehearing and Decision Final and Appealable) the commission's decision is final and appealable. sec.55.29. Determination of Affected Person. (a) For any application, an affected person is one who has a personal justiciable interest related to a legal right, duty, privilege, power, or economic interest affected by the application. An interest common to members of the general public does not qualify as a personal justiciable interest. (b) Governmental entities, including local governments and public agencies, with authority under state law over issues contemplated by the application may be considered affected persons. (c) All relevant factors shall be considered, including, but not limited to, the following: (1) whether the interest claimed is one protected by the law under which the application will be considered; (2) distance restrictions or other limitations imposed by law on the affected interest; (3) whether a reasonable relationship exists between the interest claimed and the activity regulated; (4) likely impact of the regulated activity on the health, safety, and use of property of the person; (5) likely impact of the regulated activity on use of the impacted natural resource by the person; and (6) for governmental entities, their statutory authority over or interest in the issues relevant to the application. sec.55.31. Determination of Reasonableness of Hearing Request. (a) The reasonableness of a hearing request shall be based on all relevant factors including the following: (1) whether the request is based solely on concerns outside of the jurisdiction of the commission; and (2) whether the request is based on concerns related to other media that cannot be addressed by the pending application, even though within the jurisdiction of the commission. (b) For hearing requests on air quality applications: (1) The following criteria shall also be considered in making a determination of reasonableness: (A) whether the project is an emissions reduction project including: (i) whether there are no increases in emissions of any contaminants and the reduction project is not driven by a noncompliance situation; and (ii) whether the project will have both emission reductions and incidental increases where the net effect is an emission reduction; (B) whether the project is mandated by commission rule; (C) the location of the proposed project; (D) whether the applicant requests authority to substitute an equivalent or more efficient control device; (E) whether the hearing request is based solely on something other than concerns about air pollution; (F) the extent to which the person requesting a hearing is likely to be impacted by the emissions; and (G) the applicant's compliance history. (2) A request concerning an amendment, modification, or renewal that would not result in an increase in allowable emissions and would not result in the emission of an air contaminant not previously emitted is unreasonable. (3) Notwithstanding paragraph (2) of this subsection, a request may be determined reasonable if the application involves a facility for which the applicant's compliance history contains violations that are unresolved and that constitute a recurring pattern of egregious conduct that demonstrates a consistent disregard for the regulatory process, including the failure to make a timely and substantial attempt to correct the violations. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606784 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Chapter 70. Enforcement The commission adopts new sec.sec.70.1-70.11, 70.51, and 70.101-70.109, concerning procedural rules. Sections 70.1-70.11, 70.51, 70.101, 70.102, 70. 104, and 70.107-70.109 are adopted with changes to the proposed text as published in the February 20, 1996, issue of the Texas Register (21 TexReg 1349). Sections 70.103, 70.105, and 70.106 are adopted without changes and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. Comments were received from Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts. Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts generally supported the adoption of the proposed sections with some changes. Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund, while apparently not opposing the adoption of the proposed sections as a whole, generally expressed concerns related to public participation and issues related to delegated federal programs. A number of commenters suggested minor editorial, typographical, and grammatical changes to clarify or shorten the proposed sections. The commission generally agrees with these suggestions, and has amended the proposed sections accordingly. These changes have been made to proposed sec.sec.1.1, 1.5, 1.7, 1.10, 1.11(a), 3.2, 5.3, 5.8, 5.10, 5.11, 5.12, 5.14, 10. 1, 10.2, 10.3, 10.6, 10.8, 20.17, 40.5, 40.6, 40.8, 40.9, 50.13, 50.17, 50.31, 55.21, 55.23, 55.25, 55.27, 55.29, 55.31, 70.2, 70.3, 70.4, 70.5, 70.6, 70.7, 70.8, 70.9(b), 70.10, 70.11, 70.101, 70.102, 70.104, 70.107, 70.108, 70.109, 80.3, 80.11, 80.17, 80.21, 80.23, 80.29, 80.31, 80.33, 80.109, 80.111, 80. 113(c), 80.115, 80.119, 80.127, 80.133, 80.155, 80.201, 80.205, 80.207, 80.209, 80.213, 80.251, 80.253, 80.257, 80.265, 80.267, 80.271, 86.1, 86.11, 86.15, 86.16, 86.34, 86.55, 86.96, 86.98, 86.99, 86.130, 86.131, 86.132, 340.41(b), 340.43(d), 340.45, 340.53(d), 340.71, 340.73, and 340.131. The titles of proposed sec.sec.10.9, 20.19, 40.5, 40.6, 40.8, 50.39(e), 55.31, 70.109, 80.5, 80.23(b), Chapter 50, Subchapter B and Chapter 86, Subchapter D have also been amended for clarity and to reflect their true content. Several commenters commented generally that the proposed sections limit public participation in permit and enforcement actions more stringently than allowed under federal law and do not meet the minimum requirements for federal program approval, basing this comment in part on a draft report prepared by one of the commenters. The commission disagrees. The commenters very narrowly construe the concept of public participation, and the commission does not agree that the statistics contained in the draft report are accurate. The commission does not agree that such a narrow emphasis on contested case evidentiary hearings at the expense of other methods of public participation is either fair or appropriate. The commission also does not agree that the proposed sections impose new limits on public participation. Although the commission's process will be continually reviewed and improved, the process and the proposed sections are consistent with the "United States Environmental Protection Agency's (EPA) Policy Statement of Public Participation," which contains no requirement for contested case hearings on every permitting matter. Public notice is given in compliance with statutory requirements, and when questions or comments from the public are received, the agency's technical staff responds to them. Agency permit engineers and attorneys spend a considerable amount of time answering questions from the public, meeting with them, educating citizens on both the scientific and legal requirements of permits. As questions are raised, staff reconfirms the review and position it is taking on permits. When there is considerable public interest expressed, the agency often will hold one or more public meetings in the local area to encourage give and take between the public, the applicant, and the staff. This is in addition to public meetings that may be required by statute (e.g., Texas Health and Safety Code, sec.361.0791, on hazardous waste management permits). Most importantly, the commenters overlook the provisions of the proposed sections which in fact dramatically increase the opportunity for public participation--now, every motion for reconsideration of an executive director's action goes directly to the commission, and every hearing request is placed on a commission meeting agenda with the right of the requestor to share information and concerns directly with the three commissioners. Most determinations on hearing requests, prior to September 1, 1995, were handled by the Office of Hearing Examiners with little, if any, involvement by the commissioners. The public now has the ability to submit information and concerns to the commissioners, very often has the ability to personally address the commissioners, and the commissioners have the ability to require the applicant and the executive director's staff to respond to those concerns. The exchange takes place in a posted, public hearing. This satisfies the "exchange of views and open exploration of issues, alternatives, and consequences" standard contained in the EPA Policy Statement. Although the commission believes that the proposed sections represent a dramatic improvement, the commission continues to explore ways to enhance this exchange of views. Several commenters suggested that the commission failed to provide notice of the procedural rule changes to the EPA as required. The commission disagrees. The commenters erroneously interpret 42 United States Code, sec.300h- 1(b)(1)(A)(ii) to require notice prior to final adoption of this rule package. Correctly read, the statute only requires notice of a rule change to the EPA after final adoption of an underground injection well program or changes to the program. Upon adoption of this package, the commission will provide appropriate notice to the EPA. One commenter suggested that proposed sec.1.1 be expanded to address both the purpose and scope of the commission's rules. The commission disagrees with this proposal because the language proposed would state what is already law, that the rights of parties and the commission's powers are established by statute and cannot be enlarged by rule, and that the statutes prevail if the commission's rules are in conflict with them. Several commenters criticized the commission's handling of confidential documents under current rules being revised and adopted as proposed sec.1.5. The commission disagrees with these comments because the commission's management of confidential documents complies with all applicable requirements. Another commenter proposed additional language for this section which would specify the duties of the agency's central records office. The commission disagrees, because the proposed directives concerning internal office procedure can be made without adopting the directives as a rule. The commission notes that it has recently directed its executive director to evaluate the agency's record management practices. This evaluation is already under way, and will include the agency's handling of confidential documents to ensure they are not inadvertently disclosed to the public. A request for proposal has been published for a study on the matter. One commenter suggested that proposed sec.1.11 be amended to make it clear what is included in the phrase "courier-receipted delivery service." The commission believes that the phrase is sufficiently clear, and declines to add any definition beyond that already provided in Texas Rule of Civil Procedure 21a. The commission believes that the modifications to proposed sec.1.11 described as follows may also resolve the commenter's concerns. One commenter noted that proposed sec.1.11 and sec.10.10 appear to be missing subsection (e), which appears in old sec.261.18, from which they are derived. The commission agrees. This deletion was inadvertent, since proposed sec.1.11 and sec.10.10 were intended to include the provisions of old sec.261.18. Proposed sec.10.10 duplicates proposed sec.1.11 and has been deleted, and subsection (e) has been added to proposed sec.1.11. In addition, the commission has further clarified proposed sec.1.11 by more closely tracking Texas Rule of Civil Procedure 21a, which the commission believes covers the same subject matter more completely, and has amended and renumbered subsections accordingly. One commenter suggested that proposed sec.3.2 be revised to incorporate several definitions currently contained in other chapters. The commission agrees in part, and has added definitions of "enforcement action" and "enforcement order" to proposed sec.3.2. Other definitions not moved are used only in single chapters, and the commission believes it more useful to leave those definitions in the chapter to which they apply, rather than move them to a general definitions section. The commission intends, however, to continue to consolidate widely used definitions in Chapter 3 for clarity and consistency. One commenter suggested that the definition of "advisory committee" in proposed sec.5.2 be condensed. The commission agrees, and has amended the proposed section accordingly. This commenter also suggested that this definition be moved from proposed sec.5.2 to proposed sec.3.2. Since this term seems to be used only in proposed Chapter 5, the commission disagrees and has left the definition in proposed sec.5.2. One commenter suggested that proposed sec.10.7 be amended to clarify that the commission will keep a certified agenda of closed meetings held in accordance with the requirements of the Texas Open Meetings Act. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.10.9 and sec.10.10 duplicate proposed sec.1.10 and sec.1.11, and suggested that the proposed sections appear only in proposed Chapter 1. The commission agrees, and has deleted proposed sec.10.10 and amended proposed sec.10.9 to change its title and refer to proposed sec.1.10 and sec.1.11. One commenter suggested that proposed Chapter 40 be amended to allow participation in Alternative Dispute Resolution (ADR) by "interested parties" and to allow mediation to occur before a request for hearing is made. While the commission wholeheartedly supports ADR efforts, it disagrees for two reasons, and declines to make the change. First, participation in ADR in contested cases must necessarily be limited to the parties to the case, or at the hearing request stage, to those filing hearing requests as well. Without this limitation, the commission believes it will be difficult for participants to commit to a process where the number and identity of negotiating parties is subject to change. Second, while the commission is strongly committed to ADR, and encourages its use at all stages of the application process, it believes that it is wiser to continue to encourage informal ADR outside of agency rules prior to entry into the contested case process, and leave its use up to the participants, rather than attempt to promulgate rules governing its use at this time. One commenter suggested that the definition of the term "alternative dispute resolution office" in proposed sec.40.2 be replaced with a definition of the term "alternative dispute resolution director" because the latter is used throughout proposed Chapter 40. The commission agrees, has amended the proposed section accordingly, and has also amended proposed sec.40.5(a)(1) accordingly. One commenter suggested deleting the words "regardless of which ADR method is used" from the definition of "mediator" in proposed sec.40.2, as not adding to the definition. The commission disagrees, because it believes that the term "mediator" is used in some circles as a term of art to refer only to a person engaged in specific dispute resolution procedures, and the term is used in these proposed sections in a more inclusive manner. One commenter suggested using the word "applicant" rather than a longer term in the definition of "participant" in proposed sec.40.2, and adding "named parties" to the definition to make clear that they are included in the definition. The commission agrees, and has amended the proposed section accordingly. One commenter suggested deleting the words "from the pool of mediators" from the first sentence of proposed sec.40.4(a) and adding clarifying language regarding private mediators, to make the proposed section more consistent with the other proposed sections of the chapter. The commission agrees, and has amended the proposed section accordingly. One commenter suggested rewording proposed sec.40.4(c) for brevity and clarity. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.40.6 could be read to exclude the possibility of a matter being referred to ADR after a draft permit is proposed and a protest letter received, but prior to the matter being referred to the State Office of Administrative Hearings (SOAH), as proposed sec.55.25(d)(1) anticipates, and suggested amending the proposed section. The commission agrees with the commenter that this can be the most productive period for ADR, expressly desires to encourage ADR at this point, and has amended the proposed section to make it clear that cases may be referred to ADR at this point and that ADR outside of the commission process may be used at any time. Several commenters commented that proposed sec.50.13 and sec.50.33 allow the commission and its executive director to act on an application without considering any comments, and generally maintain that the proposed sections of procedural rules as a whole preclude public comment. The commenters also claim that the provisions of proposed sec.50.33 which prevent action by the executive director where there is a "protest" and the provision for motions for reconsideration are not an adequate substitute for a public comment process. The commission disagrees, and declines to amend the proposed sections. Proposed sec.50.13 and sec.50.33 allow action without a contested case hearing, which is not equivalent to action without considering comments. The procedures contained in the proposed procedural rules sections are, for the most part, in addition to the commission's public comment process, rather than a substitute for them, as the commenters apparently assume, and the equation of participation in a contested case hearing with public comment is inappropriate. The commission actively encourages public participation, and has gone on record repeatedly to express this and to broaden public participation, but believes that the amendments suggested by the commenters go far beyond the scope of this rulemaking. One commenter suggested that proposed sec.50.39 be amended to allow only an "affected person" to file a motion for reconsideration of an executive director's action on an application, suggesting that the term "other person" is too broad. The commission disagrees, and declines to change the proposed section, because the proposed language gives the commission flexibility to reconsider decisions in situations where the error complained of merits attention regardless of who raises it. Additionally, allowing any person to file a motion for reconsideration allows another avenue for public comment by bringing concerns directly to the attention of the commission. The commission believes, however, that the question of whether a person filing a motion for reconsideration is an affected person will in some cases have a bearing on whether the commission acts on the motion. Several commenters criticized proposed sec.55.21(b) and (d), claiming that because of multiple publications, it may be difficult to tell when the deadline for a hearing request occurs. While much of the timing and many of the contents of notices are specifically required by statute, to the extent that this becomes a problem, the commission plans to deal with it in rulemaking on a new proposed chapter governing public notice, rather than in this rulemaking. Several commenters suggested that proposed sec.55.21(c) constitutes an unlawful delegation and allows the person who designs a notice to decide what will be required in a hearing request. The commenters further assert that the proposed section does not adequately plan for errors in the published notice. The commission disagrees, and declines to change the proposed section. The statutes and other sections of the commission's rules dictate the content of public notices, and this proposed section merely requires hearing requests to comply with those requirements, if any. If the notice is defective, this must be generally cured through republication, thus giving another chance to comply with any requirements. Several commenters criticized proposed sec.55.21(e) for not establishing procedures for requesting extensions of time and suggested the inclusion of a "good cause" or public interest test. The commission disagrees. This section is primarily intended to allow the commission to consider late hearing requests. The commission believes that the proposed section allows more flexibility for the commission and the public than the suggestion does, and declines to change the section. One commenter suggested that proposed sec.55.23(b) be revised to require a group or association to provide an explanation of its hearing request with sworn affidavits, written resolutions, or other satisfactory documentation, rather than to allow other parties to request such an explanation. The commission disagrees. While the proposed sections anticipate that a group or association will submit such information, requiring this as an absolute requirement in advance when the group or association's qualifications are not in dispute is burdensome and unnecessary. However, allowing the listed parties to request that evidence, if they believe it to be an issue, protects the integrity of the hearing process and the rights of the applicant while limiting evidence and testimony to those issues that are actually in dispute. Several commenters suggested that proposed sec.55.23(b) and sec.55.26(f) place unreasonable burdens on the public in replying to responses to hearing requests. There is no proposed sec.55.26 and the latter reference is apparently to proposed sec.55.25(f). The commission disagrees, because these proposed sections merely provide a way for the commission and other parties to determine the basis of a hearing request, which is clearly relevant under Texas Water Code, sec.5.115. While the commission does not agree that the proposed time periods are unreasonable, it has determined that the time for replying to responses to hearing requests in proposed sec.55.25(f) should be lengthened from ten days to 14 days to give requestors more time to prepare, and has amended proposed sec.55.25 accordingly. Several commenters suggested that the commission amend proposed sec.sec.55.25, 55.27, 55.29, and 55.31, to change the way the commission deals with hearing requests and with determinations of whether a person is an "affected person," whether a request is "reasonable," and what constitutes "competent evidence" under Texas Water Code, sec.5.115. The commission agrees that these items may need further attention, but, as announced at the beginning of this phase of rulemaking and stated in the preamble to these proposed rules, has reserved this issue for further rulemaking, once sufficient experience has been accumulated with the existing process to fairly evaluate how well the existing rules are working. This project is already underway at the agency, and the commission expects that it will get into full swing shortly after this rulemaking project is concluded. While some minor adjustments to the current process are included in this round of rulemaking, the commission declines to make the suggested major changes in this round of rulemaking. Several commenters suggested that the proposed sections place an unreasonable burden on who can qualify for a hearing and claimed that the commission has not implemented its authority to provide for public participation in hearings. The commission disagrees. As noted previously, the commission believes that the proposed sections broadly encourage public participation. In addition, the proposed sections are entirely consistent with the law on hearings and standing. Finally, the commission is already committed to reviewing this process in another round of rulemaking. Several commenters suggested that proposed sec.55.25(g) be revised to allow a legislator (for an activity in the legislator's district), a state agency, a federal agency, or a local government (for a facility within the local government's jurisdiction) to send an application directly to SOAH for a contested case hearing. The commission disagrees. Nothing in the statutes grants such blanket rights, and the commission believes that adding this provision would violate both the letter and intent of Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115, as well as other specific statutes dealing with contested case hearings, and therefore declines to make this change. One commenter noted that the provisions of proposed sec.55.27 and sec.55.29 do not appear to address instances where the definition of affected persons in the rule (and in Texas Water Code, sec.5.115) may differ from specific statutory provisions defining "affected person" or "person affected," and suggested that the proposed sections be revised to make it clear that specific statutory provisions control. In the alternative, the commenter suggested that the commission apply both the definition of "affected person" in the proposed sections and any specific statutory definition. The commission agrees with the commenter that Texas Water Code, sec.5.115, the proposed sections, and other specific statutes can and should be read together. Generally, Texas Water Code, sec.5.115 will require a "personal justiciable interest," while other specific statutory provisions delineate those interests, specifying distance limitations or identifying specific persons who can request a hearing. The commission believes that the provisions of proposed sec.55.27 (that a hearing request be granted if it is "pursuant to a right to hearing authorized by law") and proposed sec.55.29 (that a relevant factor in determining whether a person has "a personal justiciable interest related to a legal right, duty, privilege, power, or economic interest affected by the application" is "whether the interest claimed is one protected by the law under which the application will be considered") require Texas Water Code, sec.5.115 and any applicable specific statute to be read together. Thus, the commission declines to modify the proposed sections. Several commenters suggested that proposed sec.55.27(b) and (c) be amended on the grounds that they conflict with statutory provisions such as Texas Water Code, Chapter 27, in which counties are granted hearings regardless of a showing of standing or reasonableness of their hearing requests. The commenters also suggested that the test for a state agency or local government needs to be clarified, alleging, for example, that a county is automatically an affected person for an activity in that county. The commission disagrees. No statute, other than those giving party status to the executive director, public interest counsel, Texas Water Development Board, and Texas Parks and Wildlife Department, provides as a blanket rule that a governmental entity is automatically an affected person for all activities in a geographic area, although some do in specific instances. Texas Water Code, sec.27.018, for instance, provides for a hearing on an injection well permit application if one is requested by a "local government." The statute further distinguishes between the terms "local government" and "affected person"--a distinction that does not appear in Texas Water Code, sec.5.115. While there may be some confusion over the use of the term "affected person" in more than one context, the commission believes that it is clear that a hearing request by a local government under Texas Water Code, sec.27.018 meets the tests of reasonableness and being "pursuant to a right to hearing authorized by law" under proposed sec.55.27(b) and "in the public interest" under proposed sec.55.27(c), and that a governmental entity may be an affected person given the definition of "person" contained in proposed sec.3.2 and its "authority under state law" in proposed sec.55.29(b). The commission further believes that the tests for a state agency or local government are sufficiently clear, and therefore declines to amend the proposed sections. Two commenters suggested that the provisions of proposed sec.55.27(c), which allow the commission to refer an application to SOAH for hearing if the commission determines that a hearing would be "in the public interest" even if there is no valid hearing request, be deleted or that the commission delineate standards it will use in making this determination. Several commenters suggested that the provision is vague in that it does not define "public interest." The commission disagrees with these comments and declines to make the suggested changes, in that it believes that there may be situations where the public interest demands a hearing (one example might be information received after the deadline for hearing requests), and also believes that it would be impossible to define "public interest" at this time in terms more specific than those used by the statutes under which the commission operates. One commenter suggested that proposed sec.55.27(c) be deleted as duplicative of proposed sec.55.27(b)(1). The commission disagrees and declines to make the proposed change. Proposed sec.55.27(b)(1) allows a commissioner, an applicant, or the executive director to request a contested case hearing and thereby refer a case to SOAH, while proposed sec.55.27(c) allows the commission as a whole to vote to send a case to SOAH. The two provisions serve different purposes and the commission believes they should be kept separate. Several commenters suggested that the commission's rules on notice need significant changes, and suggested that proposed sec.55.27(c) be amended to prohibit the final notice on a permit from being issued before technical review is complete and a draft decision is available. The commission does not agree that these proposed sections are the place to deal with notice requirements, notes that no notice has been given to the public or interested parties that notice requirements would be changed in these proposed sections, and points out that it is in the process of preparing for publication a new chapter to consolidate many of its notice rules. However, the commission disagrees with the commenters that the existing rules regarding notice are inadequate or restrict public participation. Proposed sec.55.27(c) does not deal with notice, but rather allows the commission to refer an application to SOAH even if there is no hearing request, and the commission does not agree that amending it to deal with notice would be appropriate or advisable. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear whether an administrative law judge can overrule a commission denial of a hearing request based on standing. The commission has amended proposed sec.55.27(f) to make its position on this issue more clear--that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear what must be done to appeal the denial of a hearing request, do not make it clear when the time period for appeal begins to run, and add new burdens by requiring two appeals. The commission does not agree, and declines to further amend the proposed sections beyond the amendments already described. The proposed sections make it clear that a party whose hearing request is denied must seek to obtain party status and then, if unsuccessful, follow procedures for a motion for rehearing as a prerequisite to appeal once the commission has disposed of the application. Since a person who files a hearing request is asking that a contested case hearing be held, that party obtains the relief sought if any hearing request is granted. That person must then seek to be admitted as a party if the person wishes to participate in the case, and decisions on that issue will be handled as they are now, although the commission anticipates that if the person has a complaint at this point, it will be the denial of party status or a limitation of issues rather than a determination on a hearing request. If all hearing requests are denied or withdrawn, persons whose requests are denied have an opportunity for the review of that decision by filing a motion for rehearing after the commission's decision on the application--that is, at the end of the case, rather than in an interlocutory appeal, as the commenters seem to suggest. The commission believes that it is clear in the proposed sections that the time period for appeals begins to run at this point. While the commenters also suggest that it is unreasonable to force parties to go through a hearing and have the result of that hearing reversed by a court based on an error in denying party status, the commission believes that the risk of this kind of result is minimal, is inherent in every determination of party status in any kind of proceeding, and is outweighed by the burden to the public that would be imposed by delaying every permitting decision until determinations of party status are appealed through the court system. Two commenters noted that proposed sec.55.27(f) allows a person whose hearing request is denied to still seek to be admitted as a party, and suggested that absent some compelling reasons, the commission's determination on the hearing request should preclude the later admission of the person as a party. The commission disagrees, and has amended the proposed section as noted previously to make it clear that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. One commenter suggested that proposed sec.55.27 be amended to allow a motion for reconsideration, rather than a motion for rehearing, of the denial of a hearing request, suggesting that the latter is only appropriate in contested cases under the Administrative Procedure Act, and that no contested case arises if a hearing request is not granted. The commission disagrees. As stated previously, the commission believes that a decision on the validity of a hearing request is an interlocutory decision only on the validity of the request, and does not necessarily dictate the outcome of a later decision on party status, or standing. The commission believes that a motion for rehearing at the conclusion of the proceedings is the most appropriate way to review such a decision. Several commenters remarked that the proposed sections do not allow for an adequate record for judicial review when no contested case hearing is held and do not establish standards for a court to use in its review. The commenters also suggest that the proposed sections do not create an adequate record in rulemaking. The commission disagrees, and declines to make changes based on this comment, because it believes that the record created is sufficient for judicial review of the commission's actions, and the standards of review are already clearly established in the statutes and rules. Similarly, the commission believes that the record created in rulemaking proceedings is more than adequate. Several commenters suggested that proposed sec.55.29 and sec.55.31 be revised to provide that the commission accept as true written statements of a person filing a hearing request for the purposes of the determination on the request or the person requesting a hearing be given an opportunity to present evidence to meet the burden of presenting competent evidence under Texas Water Code, sec.5.115. The commission disagrees and declines to make these changes. The first alternative ignores the clear intent of Texas Water Code, sec.5.115, by allowing a person to meet its standards by simply claiming that the standards are met. Texas Water Code, sec.5.115 provides that the commission "is not required to hold a hearing if the commission determines that the basis of the person's hearing request is unreasonable or is not supported by competent evidence." The second alternative does not recognize that this determination will require different procedures in different cases, and the flexibility which the proposed sections provide--from a decision on the pleadings to oral argument to an evidentiary hearing--allows for procedures to be followed which are appropriate for the cases presented. For example, a permit renewal under Texas Health and Safety Code, sec.382.056 may be an example of a case where requests not alleging increases in emissions or compliance problems can be dealt with on the pleadings alone. Similarly, a person who cannot allege a reasonable basis for a hearing request or who cannot allege that competent evidence exists to support the request, despite having more than one opportunity to do so (the request itself, a reply filed under proposed sec.55. 25(f) to responses that point out the merits or deficiencies of the request, and, in appropriate cases, argument or testimony before the commission) is not going to be able to present such evidence at a hearing, and it may be appropriate to resolve this request without an evidentiary hearing. Several commenters suggested that proposed sec.55.31 is unconstitutionally vague and conflicts with other Texas Natural Resource Conservation Commission rules and the law, specifically proposed sec.55.29 and Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115 and that the provisions of proposed sec.55.31(b)(3) are overly burdensome on public participation. The commission disagrees. The commission believes that the proposed section fully complies with the constitution and with Texas Health and Safety Code, sec.382. 056 and Texas Water Code, sec.5.115. The term "reasonableness" is adequately defined by proposed sec.55.31. Further, proposed sec.55.31 does not conflict with proposed sec.55.29, because they deal with different matters--the first with the determination of whether a person is an "affected person," and the second with whether a hearing request is "reasonable." Several commenters suggested that the proposed rules be revised to "provide that the commission will make determinations and record those determinations so that the public can understand the basis for its government's decision and so that a reviewing court can determine if the actions of the commission should be affirmed or reversed." As noted previously, the commission believes that the proposed sections do exactly that and declines to make changes based on this comment. Several commenters suggested that proposed sec.55.33(a)(3) (and presumably proposed sec.80.5(a)(3)) be revised, claiming that the proposed section requires the Chief Clerk to pay the cost for issuing public notices. The commission disagrees, since the proposed section requires the clerk to issue notice and does not provide for the Clerk to pay the cost of notice, since applicants are clearly responsible for those costs. Proposed sec.55.33 has been withdrawn, however, and only proposed sec.80.5 now governs the Chief Clerk's actions in this context. Several commenters noted that the setting procedures of proposed sec.55.33 largely duplicate those of proposed sec.80.5, and suggested the deletion of one or the other. Some commenters suggested conforming these two proposed sections. The commission agrees that these sections are duplicative and should be conformed, and notes as well that proposed sec.70.109 largely duplicates both of these sections. For clarity, the commission believes that it is most logical to lay out all setting procedures only in proposed Chapter 80, and has deleted proposed sec.55.33 and amended proposed sec.70.109 accordingly. Several commenters suggested that the proposed sections of proposed Chapter 70 limit public participation in enforcement proceedings in a fashion that does not meet the federal requirements for such participation and further state that notice in the Texas Register is insufficient. The commission disagrees, and declines to change the proposed sections. The agency complies with federal authorization rules regarding public participation in enforcement matters, which require the agency to have procedures in place for responding to citizen complaints, publish notice of settlements of civil actions, and give assurance that it will not oppose intervention by any citizen when permissive intervention is authorized by statute, rule, or regulation. In regard to the comment that Texas Register publication is insufficient, while the commission disagrees, it is currently considering alternative citizen participation in administrative actions. If rule changes are necessary after a decision is made on this issue, they will be taken up separate from this rulemaking. One commenter suggested that the definitions of "enforcement order," "enforcement action," "petition," and "respondent" be moved from proposed sec.70.2 to proposed sec.3.2. The commission agrees that the definitions of "enforcement action" and "enforcement order" should be moved to sec.3.2 since they are used in general context in other chapters of the agency's rules; however, the terms "petition" and "respondent," as they are defined in proposed Chapter 70, are specific to enforcement actions by the commission only and should remain in proposed Chapter 70. The commission does not believe that generic definitions of petition and respondent are necessary in proposed Chapter 3 to cover permitting matters because those terms are generally accepted legal terminology and "petition" is already included in the definition of "application." One commenter suggested that proposed sec.70.51 substantially changes old sec.337.71 from relating only to water rights enforcement matters to a more general mandatory enforcement hearing process. The commission disagrees. The language in proposed sec.70.51 was taken verbatim from old sec.337.71, except that the title of the subchapter was changed and references to other rules which had been renumbered were changed. The definitions included in old sec.337. 71 included water quality, water rights, hazardous waste releases, and references to the air statute as well. Although the title of old sec.337.71 indicated "Water Rights Enforcement," its statutory basis is Texas Water Code, sec.5.117, which applies to the agency as a whole, and requires the executive director to bring all instances of substantial noncompliance before the commission. The commenter expressed concern that proposed sec.70.51 would require mandatory hearings for incorrect compliance with record keeping requirements in an air permit. Since this would normally not be a substantial noncompliance under the air rules, this section would not apply in that case. Furthermore, old sec.337.71 and proposed sec.70.51 both exclude air violations, since a separate statutory requirement exists for the air program. The program most affected by this statutory requirement is the water quality program, which has a large amount of self-reporting data submitted each month. The proposed section basically sets forth the practice of the watershed management and enforcement divisions in processing this large volume of documents and describes how they determine what constitutes a substantial noncompliance. One commenter suggested that the concept of "executive director preliminary reports" (EDPR), used in proposed sec.70.101, is not necessary in proposed Chapter 70 and is not mandated by statute. While EDPRs are not required by statute, they are clearly allowed and anticipated by statute (see Texas Water Code, sec.sec.13.4151(c) and (d), 26.136(d) and (e), 27.1015(d) and (e), 34. 011(d) and (e) and Texas Health and Safety Code, sec.sec.341.049(c) and (d), 361. 252(d) and (e), 366.0924(d) and (e), 382.088(d) and (f), and 401.384- 401.385). This rulemaking does not alter the provisions in old Chapter 337 regarding preliminary reports, and sets forth the agency's procedures if preliminary reports are chosen as the form of pleading in a case. The executive director is not required to issue a preliminary report, but is given an option which may be used on a case-by-case basis, which is consistent with the statutory provisions. The commission disagrees with the comment and declines to change the proposed section. The commission has determined that the setting procedures of proposed sec.70. 109 largely duplicate those of proposed sec.80.5, and has amended them to simply refer to proposed sec.80.5. The commission has also amended the title of this section for clarity. One commenter suggested that proposed sec.80.3(a) be amended to make it clear that the judge sitting in a phase of a hearing, not the presiding judge, will resolve evidentiary questions raised during that phase of a hearing. The commission generally agrees, but believes that it may be necessary for a judge sitting in one phase of a hearing to refer some important evidentiary questions to the presiding judge, and has amended the section accordingly. Two commenters suggested that proposed sec.80.3(b)(10) be revised to make it clear that the judge may limit the time of presentation of evidence and witnesses without unfairly prejudicing the rights of parties. The commission agrees, and has amended the rule accordingly. In addition, the commission believes that splitting proposed sec.80.3(a) into two subsections and redesignating proposed sec.80.3(b) as sec.80.3(c) makes the proposed rule more readable, and has amended it accordingly. Two commenters suggested that proposed sec.80.5(b) be amended to expressly state that the commission may limit the issues that shall be considered by SOAH in a contested case. The commission agrees that this ability is implicit in Texas Government Code, sec.2003.047(e), and has amended the proposed section accordingly. These commenters also suggest that the proposed section be amended to provide that the commission "may," rather than "shall," identify issues to be addressed. Since Texas Government Code, sec.2003.047(e) uses "shall," the commission disagrees and declines to make this change. The commission has amended proposed sec.80.5(b) to make it clear that the executive director's petition or EDPR serves as the list of issues to be addressed by SOAH in a contested enforcement case. One commenter suggested that proposed sec.55.33(b) (the same as proposed sec.80.5(b)) be deleted, stating that while the commission may want to restrict or direct the list of issues, the proposed section suggests that a referral is not adequate if it does not. The commission disagrees, since Texas Government Code, sec.2003.047(e) clearly mandates an issues list, and since the proposed section gives the commission the flexibility to submit both broad and narrow ranges of issues. Several commenters suggested that proposed sec.80.13 be amended to allow parties, as well as the executive director, to request consolidation of related proceedings. The commission disagrees and declines to change the proposed section, because this is already allowed by the proposed sections. Proposed sec.80.13 allows the executive director to consolidate matters with the permission of the judge, and allows the judge to consolidate matters, presumably on the judge's own motion or that of any party. One commenter noted that due to changes in Chapter 291 of the commission's rules, proposed sec.80.17 does not accurately reflect the burden of proof in certain water and sewer rate cases. The commenter also noted that enforcement cases covered by subsection (c) of the rule should be expressly excepted from subsection (a). The commission agrees, and has amended the proposed section accordingly. One commenter suggested that proposed sec.80.27 be deleted as duplicative of proposed sec.sec.1.08, 1.10, 1.11, and 80.31. While the proposed sections cover similar matters, the commission disagrees and declines to make the change, because proposed sec.80.27 covers mostly matters of form, while the other proposed sections deal with more procedural matters. The commission has amended proposed sec.80.101 to make it clear that the executive director may either act on a matter remanded to the executive director or set it for consideration at a commission meeting. This is allowed by the proposed section, but the amendment lends clarity. One commenter suggested that proposed sec.80.107 is of sufficient importance that it should be dealt with as a separate subchapter. While the commission agrees that the proposed section is important, it prefers as a matter of form at this time not to create additional subchapters, and declines to make the change. One commenter suggested deleting the phrase "administrative law" from a reference in proposed sec.80.107(a)(3) to result in consistent references to the presiding officer as "judge." The commission agrees, and has amended the proposed section accordingly. One commenter suggested amending proposed sec.80.109(b) to define only statutory parties. The commission disagrees, and believes that the proposed section serves a more useful function by referring to all parties to an application, rather than just statutory parties, and declines to make this change. One commenter suggested deleting proposed sec.80.109(c) as duplicative of proposed sec.80.115. The commission agrees, and has amended the proposed section accordingly, renumbering the subsequent subsections. One commenter suggested deleting proposed sec.80.109(d) (now sec.80.109(c)) as duplicative of proposed sec.80.3(b)(5). The commission disagrees, since the section as amended in response to comments on proposed sec.80.115 now makes it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. One commenter suggested moving proposed sec.80.109(e) ((now sec.80.109(d)) to proposed sec.80.119, arguing that it makes more sense to discuss the effects of continuance in that section. The commission disagrees and declines to make the change. Proposed sec.80.109(e) (now sec.80.109(d)) is intended to make it clear that a person designated as a party retains party status regardless of any postponement of a hearing. Since the rule is limited to party status, the commission feels that it makes more sense to leave it in its present location. Several commenters commented that proposed sec.80.111 prohibits the judge and commission from considering comments. The commission disagrees, and points out that the section does not at all impair the executive director's ability to consider comments. The proposed section prohibits the judge from considering protests or comments submitted by non-parties in a non-evidentiary context (not under oath and without the opportunity to cross-examine) as evidence in contested case proceedings. The commission believes this is required by law, and declines to change the proposed section. The commission notes, however, that the phrase "[i]n proceedings other than enforcement proceedings" was inadvertently published as the end of the second sentence of this section, rather than as the beginning of the third sentence. The commission has amended the section accordingly, so that this limitation applies to questions submitted to the judge, not to the consideration of comments. One commenter noted that proposed sec.80.115 is not clear as to whether each and every party has a right to conduct discovery, present a direct case, cross- examine witnesses, obtain copies of pleadings, and so on, even when parties have been aligned under proposed sec.80.109. The commission agrees that the two provisions could be confusing when read together, and has amended proposed sec.80.109(d) to make it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. The commission anticipates that judges will exercise their best judgment when aligning parties and specifying the purposes for which they are aligned. One commenter suggested that proposed sec.80.117(b) be revised to make it clear that all persons granted party status are covered in the order of presentation. The commission agrees, and has amended proposed sec.80.117 by substituting the words "other parties" for the word "protestant." One commenter suggested deleting the word "SOAH" from proposed sec.80.119(d) to make it clear that the section does not restrict the judge in a contested case proceeding to the use solely of SOAH mediators. The commission agrees, and has amended the proposed subsection accordingly. The subsection has also been combined with proposed sec.80.119(c), to make the section shorter and more clear. One commenter suggested combining proposed sec.80.127(a)(2) and (c) to eliminate duplication. The commission agrees, and has amended the proposed section and renumbered subsections accordingly. One commenter suggested that proposed sec.80.127 be revised to more closely track the provisions of Texas Rule of Civil Procedure 267 and Texas Rule of Evidence 613, which prohibit the exclusion from the hearing room when "the rule" is invoked of an officer or employee of a party that is not a natural person and who is designated as its representative by its attorney and a person whose presence is shown by a party to be essential to the presentation of its case. The commission agrees, and has added subsection (f) to the proposed section so that it will more closely track the practice in the courts. One commenter suggested amending proposed sec.80.133 to allow the judge to set a schedule for the submission of written briefs. The commission agrees, and has amended the proposed section accordingly. Two commenters suggested that proposed sec.80.137 be amended to incorporate by reference Texas Rule of Civil Procedure 166a, because of the substantial body of interpretive case law and legal commentary available. The commission agrees that Rule 166a contains valuable guidance, and has tried to track the language of the rule in the proposed section as far as it considers appropriate given the difference between the administrative and judicial processes and the commission's assumption that the most likely use of the proposed section will be to limit issues, rather than to dispose of applications. The commission has accordingly modified the proposed section to track Rule 166a more closely, and anticipates that practitioners and judges will look to Rule 166a and the decisions construing it for guidance. Two commenters suggested that proposed sec.80.137 be amended to change some language relating to testimonial evidence. Because of the amendments noted previously, the commission believes the issue raised by this language to be resolved and declines to make further changes. One commenter suggested that proposed sec.80.151 be amended to expressly refer to Texas Rule of Civil Procedure 215. The commission disagrees, and declines to change the proposed section, because it believes that the grant of authority in Texas Government Code, sec.2003.047 and the sanctions provisions of proposed sec.80.107 already make sufficient provision for sanctions for discovery abuse. One commenter suggested that proposed Subchapter E of Chapter 80 (the "Freeze Rules") be deleted. While the commission recognizes the commenter's concern, it feels that the "freeze rules" have not yet been given a real test in practice, and is inclined to amend, rather than repeal them. The commission has corrected an incorrect reference in proposed sec.80.205 to refer to sec.80.105, rather than sec.80.60. Several commenters suggested that proposed sec.80.203(a)(1) be amended so that it does not require the executive director to prepare a draft permit if the executive director does not recommend the issuance of a permit. The commission disagrees, and declines to make this change, in part because the "freeze rules" were the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome, and in part because the failure to prepare a draft permit would present an almost insuperable barrier to an applicant should the applicant prevail on the issue of whether or not a permit should be issued. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.207(c) be amended to eliminate the additional time proposed beyond the first discovery period for filing a list of issues. The commission disagrees, and declines to make this change. An earlier version of this rule required protestants to have their issues list finished simultaneously with the end of the first discovery period, which the commission believes compresses the work that must be done. The commenter suggested that in the event the additional time remained, additional time should be added to proposed sec.80.207(e) as well. The commission disagrees and declines to make this change, since additional time is already granted by timing the applicant's response from the time the first list of issues is submitted, rather than the close of the first discovery period. Several commenters commented that proposed sec.80.207(d) allows an applicant to disrupt the work required of protestants to comply with subsection proposed sec.80.207(c), and suggested the deletion of the second sentence in subsection (d). The commission disagrees, and declines to make this change. The commenters apparently missed the time extension given in proposed sec.80.207(c), which now allows for completion of the issues list "within 20 days after the end" of the time period originally contained in old sec.265.104, from which the proposed section is derived. The result of the proposed sections is to give the protestant an additional 20 days to complete the issues list, while allowing the applicant to go forward with discovery. The result, rather than an additional burden on the protestant, is an easing of requirements. One commenter suggested that proposed sec.80.207(h) be amended to allow a limited amendment of the application in some circumstances. While the commission agrees that this commenter's point has some merit, the current arrangement was the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.209(c)(3) be amended to require the judge to distribute a prehearing order within four days from the prehearing conference. While the commission recognizes the commenter's concern and the limited (14-day) time period between the prehearing conference and the hearing, it prefers at this time to leave the timing of the prehearing order to the judge, trusting that prehearing orders will be distributed as soon as possible considering the compressed time frame. Two commenters suggested that proposed sec.80.213 be revised to make it clear that paragraph (1)(A) and (B) is not mutually exclusive and that the judge may direct a party to both voluntarily reduce its listed witnesses and provide a summary of the expected testimony of each witness. One commenter also suggested that the language of the rule be made more clear that the judge may prohibit testimony of witnesses. The commission agrees, and has amended the section accordingly. Several commenters suggested that proposed sec.80.259 be revised to eliminate a provision that would allow a judge to file an amended proposal for decision without serving it on the parties. This provision was included in a redline/strikeout version of the proposed rules distributed by agency staff during the rulemaking process, but was dropped from the proposed rule before publication, and thus no revision to the proposed rule is necessary. The staff regrets any inconvenience caused by failing to notify interested persons of the change before publication. The commission has amended proposed sec.80.263 to make it clear that the general counsel may set time limits for oral presentations before the commission. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.sec.80.265, 80.267, and 80.271 to remove the word "final" where it refers to commission decisions or orders, because the use of the word in these proposed sections may be unintentionally confusing when compared with the use of the word in Government Code, sec.sec.2001.141-2001.144, dealing with when decisions become final. One commenter suggested that the provision of proposed sec.80.267(b) that the commission will render a decision within 60 days after the date the hearing is finally closed does not give the commission enough time to render its decisions. The commenter suggested lengthening the time period to 90 days. The commission agrees that cases heard by a judge may take more than 60 days, but notes that the 60-day period is mandated by Texas Government Code, sec.2001. 143 unless extended. The commission believes, however, that proposed sec.80. 267(b) gives the judge enough flexibility to extend the time, and therefore declines to make the suggested revision. The commission has amended proposed sec.80.277 to more clearly reflect the commission's position and longstanding agency practice that the executive director or an authorized representative may forward an enforcement order to the attorney general for enforcement. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.86.18(c)(1)(C) to change the time period for filing applications for rehearing to 30 days to be consistent with Water Code, sec.11.316. One commenter suggested that the definition of "monitoring well" in proposed sec.340.2 be amended to expressly exclude monitoring wells used in conjunction with the production of coal and lignite, as is apparently intended by the general exclusion for wells used in conjunction with the production of "other minerals." The commission agrees, and has amended the section accordingly. One commenter noted that proposed sec.340.73 appears to differ from the requirements under discussion at the agency for sec.338.31 and sec.338.32 as to the persons to whom copies of well logs are to be submitted. The commission agrees, and has amended proposed sec.340.73 and sec.340.75 to add local underground water conservation districts and make these sections consistent. Subchapter A. Applicability and Definitions 30 TAC sec.sec.70.1-70.11 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.70.1. Purpose. The purpose of this chapter is to provide general rules governing enforcement actions before the commission. Procedures for contested enforcement cases are located in Chapter 80 of this title (relating to Contested Case Hearings). If some part or parts of these rules cannot be interpreted as consistent with the Texas Water Code, the Texas Health and Safety Code, or the APA, or where applicable parts of those statutes are not specifically included in these rules, the statutes shall control. sec.70.2. Definitions. Unless specifically defined in this chapter, all terms used in these rules bear the same definitions ascribed by the Texas Water Code, the Texas Health and Safety Code, the APA, and commission rules. The terms specifically defined for the purposes of this chapter are as follows. Contested enforcement case-An action in which the executive director seeks an enforcement order and the respondent, where having a right to do so, contests the issuance of the order by requesting an evidentiary hearing. Executive director's preliminary report (EDPR)-A pleading filed by the executive director which, when issued and served under this title, seeks an enforcement order against a respondent. EDPR is further defined in Subchapter C of this chapter (relating to Enforcement Referrals to SOAH). Petition-The instrument by which the executive director states a cause of action for an enforcement order against a respondent. When an EDPR is filed and issued under this chapter the EDPR and notice constitute a petition, as do amended EDPRs and amended or supplemental petitions. Respondent-A person against whom the executive director is seeking an enforcement order. sec.70.3. Enforcement Guidelines. The executive director may use enforcement guidelines that are neither rules nor precedents, but rather announce the manner in which the agency expects to exercise its discretion in future proceedings. These guidelines do not establish rules which the public is required to obey or with which it is to avoid conflict. These guidelines do not convey any rights or impose any obligations on members of the public. These guidelines are available to the public under the terms of the Public Information Act, Texas Government Code, Chapter 552. sec.70.4. Annual Enforcement Report. The executive director shall prepare an annual report of enforcement actions covering the previous fiscal year. This report shall include, at a minimum, the following: (1) the number of complaints received by the agency, indicating the distribution of those complaints geographically; (2) an estimate of the total number of facilities subject to inspection by the agency, categorized by region and program area; (3) a list of facilities actually inspected, giving location and program area conducting the inspection; (4) the number of cases referred from Regions to Central Office for enforcement, categorized by Region; (5) the number of cases resolved informally (without issuance of an agency order), categorized by Regional Offices and Central Office; (6) a listing of all orders issued, including names of respondents, location of facility covered by the order, programs covered by the order, and amount of administrative penalty assessed (including whether any amount was deferred and, if an amount was deferred pursuant to approval of a supplemental environmental project, a description of the project); (7) a calculation of the total, average, and mean of administrative penalties assessed, excluding deferred penalties, with an additional categorization of these numbers by program area; (8) the number of permit revocations, suspensions, or amendments issued resulting from enforcement actions; and (9) the average number of regional inspectors employed. sec.70.5. Remedies. Remedies available to the commission in enforcement actions include all those found in the Texas Water Code, the Texas Health and Safety Code, and the APA. These include, but are not limited to, issuance of administrative orders with or without penalties, referrals to the Texas Attorney General's Office for civil judicial action, referrals to the Environmental Protection Agency for civil judicial or administrative action, referrals for criminal action, or permit revocation or suspension. Nothing herein shall be construed to preclude the executive director from seeking any remedy in law or equity not specifically mentioned in these rules. In addition, an enforcement matter may be resolved informally without a contested case proceeding in appropriate circumstances. sec.70.6. Judicial Civil Enforcement. The executive director is authorized to cause to be instituted, in courts of competent jurisdiction, legal proceedings to enforce and compel compliance with any provisions, whether of statutes, rules, regulations, permits or licenses, or orders, that the commission is entitled or required by law to enforce or with which the commission is entitled or required by law to compel compliance. Such legal proceedings may be initiated at any time by the executive director by a letter from the executive director or an authorized representative referring the matter to the Texas Attorney General's Office and requesting that the attorney general take action on behalf of the commission. sec.70.7. Force Majeure. (a) Any pollution, or any discharge of waste without a permit or in violation of a permit, shall not constitute a violation under this chapter if the pollution or discharge is the result of causes which are outside the control of the permittee or the permittee's agents and could not be avoided by the exercise of due care. Such acts include, but are not limited to, an act of God, war, strike, riot, or other catastrophe. (b) The owner or operator of the affected facility shall have the burden of proof to demonstrate that any pollution or discharge is not a violation as provided by subsection (a) of this section. (c) If force majeure is claimed as an affirmative defense to an action brought under this chapter, the permittee must submit notice to the executive director as provided by sec.305.125(9) of this title (relating to Standard Permit Conditions). (d) The executive director shall respond in writing within 30 days from receipt of the notification provided under subsection (c) of this section with a determination as to whether the event constitutes a force majeure and an affirmative defense to an enforcement action. sec.70.8. Financial Inability to Pay; Amount Necessary to Obtain Compliance. (a) If any respondent, in response to an EDPR or petition, asserts an inability to pay the penalty recommended in that pleading, or challenges the executive director's recommendation regarding the amount of penalty that is necessary to deter future violations, that party shall have the burden of establishing that a lesser penalty is justified under that party's financial circumstances. (b) A party asserting a claim under this section must produce all financial records that would be potentially relevant to that issue within 30 days of raising that claim, but no later than 30 days before the specified date for hearing without leave from the judge. The executive director is not required to make a discovery request for such financial records. The failure of the party raising such a claim to provide all potentially relevant financial records within the time discussed in this subsection shall constitute a waiver of the claim. sec.70.9. Installment Payment of Administrative Penalty. (a) Any person(s), firm, or business may, upon approval of the commission, be allowed to make installment payments of an administrative penalty imposed in an agreed order. (b) A qualifying small business upon written request shall be allowed to make installment payments of an administrative penalty imposed in an agreed order, subject to the following. (1) For purposes of this provision, a small business shall be defined as any person, firm, or business which employs, by direct payroll and/or through contract, fewer than 100 full-time employees and with net annual receipts of less than $3 million. For the purposes of this provision, net annual receipts is defined as annual gross receipts less returns, discounts, and adjustments. The period used to determine net annual receipts under this section shall be the preceding 12-month accounting year and can be either a calendar or fiscal-based period. (2) A business that is a wholly-owned subsidiary of a corporation shall not qualify as a small business under this section if the parent organization does not qualify as a small business under this section. (3) The amount and payment schedule of monthly installments must be specified by an agreed order. (4) Payment schedules issued may not exceed a 12-month period. sec.70.10. Agreed Orders. (a) The executive director and the respondent may reach an agreement, or settlement, in an enforcement action such that an agreed order is recommended to the commission for approval and issuance. In order to have legal effect as an order of the commission, and in any case in which penalties are assessed, an agreed order must be approved and issued by the commission. In such an agreed order, the respondent may agree to: (1) admit to none, any, or all of the violations alleged in any EDPR or petition in the case; (2) assessment of a specific administrative penalty; (3) remedial ordering provisions; (4) any combination of these; and (5) any other lawful provisions agreed to by the executive director and the respondent. (b) The effective date of an order, for purposes of compliance with its terms and conditions, including deadlines, shall be the date on which service of notice of the order is achieved under the APA, sec.2001.142. (c) When an agreement is reached, the executive director shall file the agreed order with the chief clerk. The chief clerk shall then schedule the agreed order for consideration during a commission meeting under Chapter 10 of this title (concerning Commission Meetings). If the enforcement action is under the jurisdiction of SOAH, the judge shall remand the action to the executive director who will file the agreed order with the chief clerk for commission consideration. The judge is not required to prepare a proposal for decision or memorandum regarding the settlement. sec.70.11. Notice of Decisions and Orders. (a) For rulings, orders, or decisions issued by the commission, parties shall be given notice, either personally or by first class mail, in accordance with the APA, sec.2001. 142. Notice shall also be given in accordance with Texas Health and Safety Code, sec.382.096, where applicable. (b) In addition to the requirements of subsection (a) of this section, when the commission issues an enforcement order in which administrative penalties have been assessed, the chief clerk shall file notice of the commission's decision and order in the Texas Register not later than ten days after the date on which the decision is adopted. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606785 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 239-1966 Subchapter B. Mandatory Enforcement Hearings 30 TAC sec.70.51 The new section is adopted under Texas Water Code, sec. sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.70.51. Mandatory Enforcement Hearings. (a) The executive director shall monitor compliance with all permits and licenses issued by the commission. If the evidence available to the executive director through the monitoring process indicates that a permittee or licensee is in substantial noncompliance for a period of four consecutive months, or for a shorter period of time if the executive director considers an emergency to exist, the executive director shall report this fact to the commission together with the information relating to the noncompliance. A certificate of convenience and necessity is not considered to be a permit or license for the purpose of this section. (1) The executive director may consider the magnitude and frequency of noncompliances with permit or license limitations and conditions in determining the existence of substantial noncompliance. (2) Substantial noncompliance includes situations involving permit or license violations which cause or have the potential to cause a significant water quality problem in, or impairment of the uses of, a receiving stream, groundwater, or other water in the state, infringes upon the water rights of diverters or appropriators of water of the state, or results in a release or threat of release of hazardous waste to the environment, or any other set of circumstances which present a threat to public health or safety or the environment. This set of circumstances includes, but is not limited to, a failure to monitor operations or report information required by a permit or license regarding the operation of a facility without which the operator and/or the commission may be unable to adequately assess the performance of the facility and thereby assure that environmental harm or threats to public health have not occurred and may not occur. In addition, substantial noncompliance will be assessed in terms of the degree of deviation from any requirement of a permit or license independent of the harm or potential harm to the environment or to public health. (3) An emergency, for purposes of this subsection, involves an unforeseen set of circumstances which calls for immediate commission action due to an actual or potential hazard to public health and safety, or severe adverse impact on or to the uses of a receiving stream, groundwater, or other water in the state. If the emergency is of sufficient gravity, the executive director shall report the emergency to the commission together with the information relating to the noncompliance and shall advise the commission of the necessity of seeking a temporary restraining order, temporary injunction, or any other remedy in equity or law necessary for the abatement of the condition or conditions causing or contributing to the emergency, if such remedy is authorized by statute. (4) Substantial noncompliance with provisions of Texas Health and Safety Code, Chapter 382, or with rules, permits, or orders promulgated pursuant to that chapter, shall be handled pursuant to Texas Health and Safety Code, sec.382.082. (b) On receiving a report under subsection (a) of this section, the commission shall call and hold a hearing to determine whether the permittee or licensee who is the subject of the executive director's report to the commission has been in substantial noncompliance with his or her permit or license. Notice for this hearing shall issue in accordance with sec.70.104(b) and (c) of this title (relating to Notice of Executive Director's Preliminary Report), except that in the event that notice is performed under sec.70.104(b) of this title, by publication, the contents of that notice need only include the name of the respondent, a summary of the relief sought by the executive director, and the right of the person to a hearing if such exists. (c) At the conclusion of the hearing, the commission shall issue an order stating one of the following: (1) no violation of the permit or license has occurred; (2) a violation of the permit or license has occurred, but has been corrected and no further action is necessary to protect the public interest; (3) the executive director is authorized to enter into a compliance agreement; (4) a violation of the permit or license has occurred and an administrative penalty is assessed as provided by the Texas Water Code or the Texas Health and Safety Code; or (5) a violation of the permit or license has occurred, and the executive director is directed to have enforcement proceedings instituted against the permittee or licensee through the office of the attorney general. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606786 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 239-1966 Subchapter C. Enforcement Referrals to SOAH 30 TAC sec.sec.70.101-70.109 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.70.101. Executive Director's Preliminary Report. (a) Any enforcement action brought under these rules may be initiated by an EDPR being filed by the executive director with the chief clerk. (b) An EDPR shall include a brief statement of the nature of the violation, the statute or statutes violated, the facts relied upon by the executive director in concluding that a violation has occurred, a recommendation that an administrative penalty be assessed, the amount of the recommended penalty, and an analysis of the factors required in the relevant statute and rules to be considered by the commission in determining the amount of the penalty. An EDPR may be superseded by a petition. sec.70.102. Pleadings Other than the Executive Director's Preliminary Report. (a) In a contested enforcement case, all pleadings for which no other form is prescribed shall contain: (1) the name of the party seeking to bring about or prevent action by the commission; (2) the names of all other known parties; (3) a concise statement of the facts and the law relied upon by the pleader; (4) a prayer stating the type of relief, action, or order desired by the pleader; (5) any other matter required by statute; (6) a certificate in accordance with sec.1.11 of this title (relating to Service on Judge, Parties, and Interested Persons), showing service; and (7) the signature of the submitting party or the party's authorized representative. (b) All pleadings shall include the docket number assigned the case by the chief clerk and shall be served on the parties in accordance with Chapter 1 of this title (relating to Purpose of Rules, General Provisions). (c) Up to seven days prior to the hearing, parties may file pleadings, supplemental or amended, so long as these pleadings do not operate as an unfair surprise to the opposite party. Amendments after that time will be at the discretion of the judge and may constitute grounds for a continuance. (d) The executive director may amend an EDPR by filing a petition with the chief clerk, in which the executive director may make such changes as the law allows, including but not limited to changes in the following: the amount of the penalty, up to the maximum allowable by statute; the violations alleged, to include any or all violations which are not precluded by law from being brought; the number of days of occurrence of previously alleged violations; and the injunctive relief (or remedial ordering provisions) sought. The right to change the violations alleged includes the right to add causes of action based on statutes within the commission's jurisdiction other than the one or ones upon which the EDPR in the case was based. Petitions are pleadings and shall be served on the parties in accordance with this Chapter and Chapter 1 of this title. (e) Any pleading may adopt and incorporate, by specific reference thereto, any part of any document or entry in the official files and records of the agency. Copies of the relevant portions of such documents must be attached to the pleadings. sec.70.104. Notice of Executive Director's Preliminary Report. (a) General requirements. Not later than the 10th day after the date on which the EDPR is issued, the executive director shall give written notice of the EDPR to the respondent. The EDPR is considered issued when it is filed with the office of the chief clerk. Notice shall consist of a copy of the EDPR, a statement of the amount of the penalty recommended, if any, and a statement of the right of the respondent to a hearing on the occurrence of the violation, the amount of the penalty, or both. (b) Timeliness and method of service. Notice shall be timely served if: (1) sent to the respondent by registered or certified mail, return receipt requested, no later than the 10th day after the date on which the EDPR is issued; or (2) delivered to the respondent in person, with the date of delivery endorsed thereon, no later than the 10th day after the date on which the EDPR is issued. (c) Service by publication. Where the executive director has been unable to deliver notice to the respondent through reasonable attempts to serve respondent by the methods described in subsection (b) of this section, notice may be effected by publishing in a newspaper of general circulation in the county of the last known business or residential address of the respondent, for a period of seven consecutive days, the following: (1) the name of the person charged; (2) a brief summary of the charges; (3) a statement of the amount of the penalty recommended, if any; (4) a statement that injunctive or remedial relief is sought; and (5) a statement of the right of the person charged to a hearing on the occurrence of the violation, the amount of the penalty, or both. (d) Proof of notice. Where proof of notice of the EDPR or petition is relevant, such as at a hearing for default judgment, a certificate by a party or an attorney of record or the affidavit of any person showing service of a notice shall be prima facie evidence of the fact of service. In addition, the executive director may offer live testimony as well as such other documentary evidence as permitted by the presiding officer, showing that the notice has been perfected. Nothing herein shall preclude any party from offering proof that the notice was not received, or if service was by mail, that it was not received within three days from the date of deposit in a post office or official depository under the care and custody of the United States Postal Service, and upon so finding, the presiding officer may extend the time for taking the action required of such party or grant such other relief as it deems just. sec.70.107. Enforcement Hearings. If required by law, an enforcement hearing shall be held before any final enforcement order is issued. In cases for which an enforcement hearing is not required by law to be held before an enforcement order is issued, the commission may elect to hold a hearing, on its own motion, or upon the request of the executive director, before issuing a final enforcement order or direct SOAH to hold such a hearing. In those cases for which an enforcement hearing is not required by law to be held before an enforcement order is issued, or for which procedures for an enforcement hearing are not specifically prescribed by rule or statute, the commission may elect to have SOAH hold such hearings under the commission's rules , including the procedures established by this chapter. sec.70.108. Contested Enforcement Case Hearings to be Held by SOAH. In a contested enforcement case, unless the commission chooses to hear the case itself, SOAH shall have the delegated authority to preside over the case under Chapter 80 of this title (relating to Contested Case Hearings). sec.70.109. Referral to SOAH. Not less than 30 days after the respondent has filed an answer under sec.70.105 of this title (relating to Answer), either the respondent or the executive director may request that the chief clerk refer the case to SOAH for a contested enforcement case hearing. The parties may request this referral by filing a letter with the chief clerk and serving that letter on the other parties. If the chief clerk receives authorization to refer a case to SOAH, the chief clerk shall refer the case to SOAH under sec.80.15 of this title (relating to Referral to SOAH to Acquire Jurisdiction Over Case). This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606787 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 239-1966 Chapter 80. Contested Case Hearings The commission adopts new sec.sec.80.1, 80.3, 80.5, 80.7, 80.9, 80.11, 80. 13, 80.15, 80.17, 80.19, 80.21, 80.23, 80.25, 80.27, 80.29, 80.31, 80.33, 80. 101, 80.103, 80.105, 80.107, 80.109, 80.111, 80.113, 80.115, 80.117, 80.119, 80.125, 80.127, 80.129, 80.131, 80.133, 80.135, 80.137, 80.151, 80.153, 80.155, 80.201, 80.203, 80.205, 80.207, 80.209, 80.213, 80.215, 80.251, 80.253, 80. 255, 80.257, 80.259, 80.261, 80.263, 80.265, 80.267, 80.269, 80.271, 80.273, 80.275, 80.277, and 80.279, concerning procedural rules. Sections 80.3, 80.5, 80.11, 80.17, 80.21, 80.23, 80.29, 80.31, 80.33, 80.101, 80.105, 80.107, 80. 109, 80.111, 80.113, 80.115, 80.117, 80.119, 80.127, 80.133, 80.137, 80.155, 80.201, 80.205, 80.207, 80.209, 80.213, 80.251, 80.253, 80.257, 80.263, 80.265, 80.267, 80.271, and 80.277 are adopted with changes to the proposed text as published in the March 19, 1996, issue of the Texas Register (21 TexReg 2136). Sections 80.1, 80.7, 80.9, 80.13, 80.15, 80.19, 80.25, 80.27, 80.103, 80.125, 80.129, 80.131, 80.135, 80.151, 80.153, 80.203, 80.215, 80.255, 80.259, 80.261, 80.269, 80.273, 80.275, and 80.279 are adopted without changes and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. Comments were received from Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts. Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts generally supported the adoption of the proposed sections with some changes. Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund, while apparently not opposing the adoption of the proposed sections as a whole, generally expressed concerns related to public participation and issues related to delegated federal programs. A number of commenters suggested minor editorial, typographical, and grammatical changes to clarify or shorten the proposed sections. The commission generally agrees with these suggestions, and has amended the proposed sections accordingly. These changes have been made to proposed sec.sec.1.1, 1.5, 1.7, 1.10, 1.11(a), 3.2, 5.3, 5.8, 5.10, 5.11, 5.12, 5.14, 10. 1, 10.2, 10.3, 10.6, 10.8, 20.17, 40.5, 40.6, 40.8, 40.9, 50.13, 50.17, 50.31, 55.21, 55.23, 55.25, 55.27, 55.29, 55.31, 70.2, 70.3, 70.4, 70.5, 70.6, 70.7, 70.8, 70.9(b), 70.10, 70.11, 70.101, 70.102, 70.104, 70.107, 70.108, 70.109, 80.3, 80.11, 80.17, 80.21, 80.23, 80.29, 80.31, 80.33, 80.109, 80.111, 80. 113(c), 80.115, 80.119, 80.127, 80.133, 80.155, 80.201, 80.205, 80.207, 80.209, 80.213, 80.251, 80.253, 80.257, 80.265, 80.267, 80.271, 86.1, 86.11, 86.15, 86.16, 86.34, 86.55, 86.96, 86.98, 86.99, 86.130, 86.131, 86.132, 340.41(b), 340.43(d), 340.45, 340.53(d), 340.71, 340.73, and 340.131. The titles of proposed sec.sec.10.9, 20.19, 40.5, 40.6, 40.8, 50.39(e), 55.31, 70.109, 80.5, 80.23(b), Chapter 50, Subchapter B and Chapter 86, Subchapter D have also been amended for clarity and to reflect their true content. Several commenters commented generally that the proposed sections limit public participation in permit and enforcement actions more stringently than allowed under federal law and do not meet the minimum requirements for federal program approval, basing this comment in part on a draft report prepared by one of the commenters. The commission disagrees. The commenters very narrowly construe the concept of public participation, and the commission does not agree that the statistics contained in the draft report are accurate. The commission does not agree that such a narrow emphasis on contested case evidentiary hearings at the expense of other methods of public participation is either fair or appropriate. The commission also does not agree that the proposed sections impose new limits on public participation. Although the commission's process will be continually reviewed and improved, the process and the proposed sections are consistent with the "United States Environmental Protection Agency's (EPA) Policy Statement of Public Participation," which contains no requirement for contested case hearings on every permitting matter. Public notice is given in compliance with statutory requirements, and when questions or comments from the public are received, the agency's technical staff responds to them. Agency permit engineers and attorneys spend a considerable amount of time answering questions from the public, meeting with them, educating citizens on both the scientific and legal requirements of permits. As questions are raised, staff reconfirms the review and position it is taking on permits. When there is considerable public interest expressed, the agency often will hold one or more public meetings in the local area to encourage give and take between the public, the applicant, and the staff. This is in addition to public meetings that may be required by statute (e.g., Texas Health and Safety Code, sec.361.0791, on hazardous waste management permits). Most importantly, the commenters overlook the provisions of the proposed sections which in fact dramatically increase the opportunity for public participation--now, every motion for reconsideration of an executive director's action goes directly to the commission, and every hearing request is placed on a commission meeting agenda with the right of the requestor to share information and concerns directly with the three commissioners. Most determinations on hearing requests, prior to September 1, 1995, were handled by the Office of Hearing Examiners with little, if any, involvement by the commissioners. The public now has the ability to submit information and concerns to the commissioners, very often has the ability to personally address the commissioners, and the commissioners have the ability to require the applicant and the executive director's staff to respond to those concerns. The exchange takes place in a posted, public hearing. This satisfies the "exchange of views and open exploration of issues, alternatives, and consequences" standard contained in the EPA Policy Statement. Although the commission believes that the proposed sections represent a dramatic improvement, the commission continues to explore ways to enhance this exchange of views. Several commenters suggested that the commission failed to provide notice of the procedural rule changes to the EPA as required. The commission disagrees. The commenters erroneously interpret 42 United States Code, sec.300h- 1(b)(1)(A)(ii) to require notice prior to final adoption of this rule package. Correctly read, the statute only requires notice of a rule change to the EPA after final adoption of an underground injection well program or changes to the program. Upon adoption of this package, the commission will provide appropriate notice to the EPA. One commenter suggested that proposed sec.1.1 be expanded to address both the purpose and scope of the commission's rules. The commission disagrees with this proposal because the language proposed would state what is already law, that the rights of parties and the commission's powers are established by statute and cannot be enlarged by rule, and that the statutes prevail if the commission's rules are in conflict with them. Several commenters criticized the commission's handling of confidential documents under current rules being revised and adopted as proposed sec.1.5. The commission disagrees with these comments because the commission's management of confidential documents complies with all applicable requirements. Another commenter proposed additional language for this section which would specify the duties of the agency's central records office. The commission disagrees, because the proposed directives concerning internal office procedure can be made without adopting the directives as a rule. The commission notes that it has recently directed its executive director to evaluate the agency's record management practices. This evaluation is already under way, and will include the agency's handling of confidential documents to ensure they are not inadvertently disclosed to the public. A request for proposal has been published for a study on the matter. One commenter suggested that proposed sec.1.11 be amended to make it clear what is included in the phrase "courier-receipted delivery service." The commission believes that the phrase is sufficiently clear, and declines to add any definition beyond that already provided in Texas Rule of Civil Procedure 21a. The commission believes that the modifications to proposed sec.1.11 described as follows may also resolve the commenter's concerns. One commenter noted that proposed sec.1.11 and sec.10.10 appear to be missing subsection (e), which appears in old sec.261.18, from which they are derived. The commission agrees. This deletion was inadvertent, since proposed sec.1.11 and sec.10.10 were intended to include the provisions of old sec.261.18. Proposed sec.10.10 duplicates proposed sec.1.11 and has been deleted, and subsection (e) has been added to proposed sec.1.11. In addition, the commission has further clarified proposed sec.1.11 by more closely tracking Texas Rule of Civil Procedure 21a, which the commission believes covers the same subject matter more completely, and has amended and renumbered subsections accordingly. One commenter suggested that proposed sec.3.2 be revised to incorporate several definitions currently contained in other chapters. The commission agrees in part, and has added definitions of "enforcement action" and "enforcement order" to proposed sec.3.2. Other definitions not moved are used only in single chapters, and the commission believes it more useful to leave those definitions in the chapter to which they apply, rather than move them to a general definitions section. The commission intends, however, to continue to consolidate widely used definitions in Chapter 3 for clarity and consistency. One commenter suggested that the definition of "advisory committee" in proposed sec.5.2 be condensed. The commission agrees, and has amended the proposed section accordingly. This commenter also suggested that this definition be moved from proposed sec.5.2 to proposed sec.3.2. Since this term seems to be used only in proposed Chapter 5, the commission disagrees and has left the definition in proposed sec.5.2. One commenter suggested that proposed sec.10.7 be amended to clarify that the commission will keep a certified agenda of closed meetings held in accordance with the requirements of the Texas Open Meetings Act. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.10.9 and sec.10.10 duplicate proposed sec.1.10 and sec.1.11, and suggested that the proposed sections appear only in proposed Chapter 1. The commission agrees, and has deleted proposed sec.10.10 and amended proposed sec.10.9 to change its title and refer to proposed sec.1.10 and sec.1.11. One commenter suggested that proposed Chapter 40 be amended to allow participation in Alternative Dispute Resolution (ADR) by "interested parties" and to allow mediation to occur before a request for hearing is made. While the commission wholeheartedly supports ADR efforts, it disagrees for two reasons, and declines to make the change. First, participation in ADR in contested cases must necessarily be limited to the parties to the case, or at the hearing request stage, to those filing hearing requests as well. Without this limitation, the commission believes it will be difficult for participants to commit to a process where the number and identity of negotiating parties is subject to change. Second, while the commission is strongly committed to ADR, and encourages its use at all stages of the application process, it believes that it is wiser to continue to encourage informal ADR outside of agency rules prior to entry into the contested case process, and leave its use up to the participants, rather than attempt to promulgate rules governing its use at this time. One commenter suggested that the definition of the term "alternative dispute resolution office" in proposed sec.40.2 be replaced with a definition of the term "alternative dispute resolution director" because the latter is used throughout proposed Chapter 40. The commission agrees, has amended the proposed section accordingly, and has also amended proposed sec.40.5(a)(1) accordingly. One commenter suggested deleting the words "regardless of which ADR method is used" from the definition of "mediator" in proposed sec.40.2, as not adding to the definition. The commission disagrees, because it believes that the term "mediator" is used in some circles as a term of art to refer only to a person engaged in specific dispute resolution procedures, and the term is used in these proposed sections in a more inclusive manner. One commenter suggested using the word "applicant" rather than a longer term in the definition of "participant" in proposed sec.40.2, and adding "named parties" to the definition to make clear that they are included in the definition. The commission agrees, and has amended the proposed section accordingly. One commenter suggested deleting the words "from the pool of mediators" from the first sentence of proposed sec.40.4(a) and adding clarifying language regarding private mediators, to make the proposed section more consistent with the other proposed sections of the chapter. The commission agrees, and has amended the proposed section accordingly. One commenter suggested rewording proposed sec.40.4(c) for brevity and clarity. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.40.6 could be read to exclude the possibility of a matter being referred to ADR after a draft permit is proposed and a protest letter received, but prior to the matter being referred to the State Office of Administrative Hearings (SOAH), as proposed sec.55.25(d)(1) anticipates, and suggested amending the proposed section. The commission agrees with the commenter that this can be the most productive period for ADR, expressly desires to encourage ADR at this point, and has amended the proposed section to make it clear that cases may be referred to ADR at this point and that ADR outside of the commission process may be used at any time. Several commenters commented that proposed sec.50.13 and sec.50.33 allow the commission and its executive director to act on an application without considering any comments, and generally maintain that the proposed sections of procedural rules as a whole preclude public comment. The commenters also claim that the provisions of proposed sec.50.33 which prevent action by the executive director where there is a "protest" and the provision for motions for reconsideration are not an adequate substitute for a public comment process. The commission disagrees, and declines to amend the proposed sections. Proposed sec.50.13 and sec.50.33 allow action without a contested case hearing, which is not equivalent to action without considering comments. The procedures contained in the proposed procedural rules sections are, for the most part, in addition to the commission's public comment process, rather than a substitute for them, as the commenters apparently assume, and the equation of participation in a contested case hearing with public comment is inappropriate. The commission actively encourages public participation, and has gone on record repeatedly to express this and to broaden public participation, but believes that the amendments suggested by the commenters go far beyond the scope of this rulemaking. One commenter suggested that proposed sec.50.39 be amended to allow only an "affected person" to file a motion for reconsideration of an executive director's action on an application, suggesting that the term "other person" is too broad. The commission disagrees, and declines to change the proposed section, because the proposed language gives the commission flexibility to reconsider decisions in situations where the error complained of merits attention regardless of who raises it. Additionally, allowing any person to file a motion for reconsideration allows another avenue for public comment by bringing concerns directly to the attention of the commission. The commission believes, however, that the question of whether a person filing a motion for reconsideration is an affected person will in some cases have a bearing on whether the commission acts on the motion. Several commenters criticized proposed sec.55.21(b) and (d), claiming that because of multiple publications, it may be difficult to tell when the deadline for a hearing request occurs. While much of the timing and many of the contents of notices are specifically required by statute, to the extent that this becomes a problem, the commission plans to deal with it in rulemaking on a new proposed chapter governing public notice, rather than in this rulemaking. Several commenters suggested that proposed sec.55.21(c) constitutes an unlawful delegation and allows the person who designs a notice to decide what will be required in a hearing request. The commenters further assert that the proposed section does not adequately plan for errors in the published notice. The commission disagrees, and declines to change the proposed section. The statutes and other sections of the commission's rules dictate the content of public notices, and this proposed section merely requires hearing requests to comply with those requirements, if any. If the notice is defective, this must be generally cured through republication, thus giving another chance to comply with any requirements. Several commenters criticized proposed sec.55.21(e) for not establishing procedures for requesting extensions of time and suggested the inclusion of a "good cause" or public interest test. The commission disagrees. This section is primarily intended to allow the commission to consider late hearing requests. The commission believes that the proposed section allows more flexibility for the commission and the public than the suggestion does, and declines to change the section. One commenter suggested that proposed sec.55.23(b) be revised to require a group or association to provide an explanation of its hearing request with sworn affidavits, written resolutions, or other satisfactory documentation, rather than to allow other parties to request such an explanation. The commission disagrees. While the proposed sections anticipate that a group or association will submit such information, requiring this as an absolute requirement in advance when the group or association's qualifications are not in dispute is burdensome and unnecessary. However, allowing the listed parties to request that evidence, if they believe it to be an issue, protects the integrity of the hearing process and the rights of the applicant while limiting evidence and testimony to those issues that are actually in dispute. Several commenters suggested that proposed sec.55.23(b) and sec.55.26(f) place unreasonable burdens on the public in replying to responses to hearing requests. There is no proposed sec.55.26 and the latter reference is apparently to proposed sec.55.25(f). The commission disagrees, because these proposed sections merely provide a way for the commission and other parties to determine the basis of a hearing request, which is clearly relevant under Texas Water Code, sec.5.115. While the commission does not agree that the proposed time periods are unreasonable, it has determined that the time for replying to responses to hearing requests in proposed sec.55.25(f) should be lengthened from ten days to 14 days to give requestors more time to prepare, and has amended proposed sec.55.25 accordingly. Several commenters suggested that the commission amend proposed sec.sec.55.25, 55.27, 55.29, and 55.31, to change the way the commission deals with hearing requests and with determinations of whether a person is an "affected person," whether a request is "reasonable," and what constitutes "competent evidence" under Texas Water Code, sec.5.115. The commission agrees that these items may need further attention, but, as announced at the beginning of this phase of rulemaking and stated in the preamble to these proposed rules, has reserved this issue for further rulemaking, once sufficient experience has been accumulated with the existing process to fairly evaluate how well the existing rules are working. This project is already underway at the agency, and the commission expects that it will get into full swing shortly after this rulemaking project is concluded. While some minor adjustments to the current process are included in this round of rulemaking, the commission declines to make the suggested major changes in this round of rulemaking. Several commenters suggested that the proposed sections place an unreasonable burden on who can qualify for a hearing and claimed that the commission has not implemented its authority to provide for public participation in hearings. The commission disagrees. As noted previously, the commission believes that the proposed sections broadly encourage public participation. In addition, the proposed sections are entirely consistent with the law on hearings and standing. Finally, the commission is already committed to reviewing this process in another round of rulemaking. Several commenters suggested that proposed sec.55.25(g) be revised to allow a legislator (for an activity in the legislator's district), a state agency, a federal agency, or a local government (for a facility within the local government's jurisdiction) to send an application directly to SOAH for a contested case hearing. The commission disagrees. Nothing in the statutes grants such blanket rights, and the commission believes that adding this provision would violate both the letter and intent of Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115, as well as other specific statutes dealing with contested case hearings, and therefore declines to make this change. One commenter noted that the provisions of proposed sec.55.27 and sec.55.29 do not appear to address instances where the definition of affected persons in the rule (and in Texas Water Code, sec.5.115) may differ from specific statutory provisions defining "affected person" or "person affected," and suggested that the proposed sections be revised to make it clear that specific statutory provisions control. In the alternative, the commenter suggested that the commission apply both the definition of "affected person" in the proposed sections and any specific statutory definition. The commission agrees with the commenter that Texas Water Code, sec.5.115, the proposed sections, and other specific statutes can and should be read together. Generally, Texas Water Code, sec.5.115 will require a "personal justiciable interest," while other specific statutory provisions delineate those interests, specifying distance limitations or identifying specific persons who can request a hearing. The commission believes that the provisions of proposed sec.55.27 (that a hearing request be granted if it is "pursuant to a right to hearing authorized by law") and proposed sec.55.29 (that a relevant factor in determining whether a person has "a personal justiciable interest related to a legal right, duty, privilege, power, or economic interest affected by the application" is "whether the interest claimed is one protected by the law under which the application will be considered") require Texas Water Code, sec.5.115 and any applicable specific statute to be read together. Thus, the commission declines to modify the proposed sections. Several commenters suggested that proposed sec.55.27(b) and (c) be amended on the grounds that they conflict with statutory provisions such as Texas Water Code, Chapter 27, in which counties are granted hearings regardless of a showing of standing or reasonableness of their hearing requests. The commenters also suggested that the test for a state agency or local government needs to be clarified, alleging, for example, that a county is automatically an affected person for an activity in that county. The commission disagrees. No statute, other than those giving party status to the executive director, public interest counsel, Texas Water Development Board, and Texas Parks and Wildlife Department, provides as a blanket rule that a governmental entity is automatically an affected person for all activities in a geographic area, although some do in specific instances. Texas Water Code, sec.27.018, for instance, provides for a hearing on an injection well permit application if one is requested by a "local government." The statute further distinguishes between the terms "local government" and "affected person"--a distinction that does not appear in Texas Water Code, sec.5.115. While there may be some confusion over the use of the term "affected person" in more than one context, the commission believes that it is clear that a hearing request by a local government under Texas Water Code, sec.27.018 meets the tests of reasonableness and being "pursuant to a right to hearing authorized by law" under proposed sec.55.27(b) and "in the public interest" under proposed sec.55.27(c), and that a governmental entity may be an affected person given the definition of "person" contained in proposed sec.3.2 and its "authority under state law" in proposed sec.55.29(b). The commission further believes that the tests for a state agency or local government are sufficiently clear, and therefore declines to amend the proposed sections. Two commenters suggested that the provisions of proposed sec.55.27(c), which allow the commission to refer an application to SOAH for hearing if the commission determines that a hearing would be "in the public interest" even if there is no valid hearing request, be deleted or that the commission delineate standards it will use in making this determination. Several commenters suggested that the provision is vague in that it does not define "public interest." The commission disagrees with these comments and declines to make the suggested changes, in that it believes that there may be situations where the public interest demands a hearing (one example might be information received after the deadline for hearing requests), and also believes that it would be impossible to define "public interest" at this time in terms more specific than those used by the statutes under which the commission operates. One commenter suggested that proposed sec.55.27(c) be deleted as duplicative of proposed sec.55.27(b)(1). The commission disagrees and declines to make the proposed change. Proposed sec.55.27(b)(1) allows a commissioner, an applicant, or the executive director to request a contested case hearing and thereby refer a case to SOAH, while proposed sec.55.27(c) allows the commission as a whole to vote to send a case to SOAH. The two provisions serve different purposes and the commission believes they should be kept separate. Several commenters suggested that the commission's rules on notice need significant changes, and suggested that proposed sec.55.27(c) be amended to prohibit the final notice on a permit from being issued before technical review is complete and a draft decision is available. The commission does not agree that these proposed sections are the place to deal with notice requirements, notes that no notice has been given to the public or interested parties that notice requirements would be changed in these proposed sections, and points out that it is in the process of preparing for publication a new chapter to consolidate many of its notice rules. However, the commission disagrees with the commenters that the existing rules regarding notice are inadequate or restrict public participation. Proposed sec.55.27(c) does not deal with notice, but rather allows the commission to refer an application to SOAH even if there is no hearing request, and the commission does not agree that amending it to deal with notice would be appropriate or advisable. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear whether an administrative law judge can overrule a commission denial of a hearing request based on standing. The commission has amended proposed sec.55.27(f) to make its position on this issue more clear--that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear what must be done to appeal the denial of a hearing request, do not make it clear when the time period for appeal begins to run, and add new burdens by requiring two appeals. The commission does not agree, and declines to further amend the proposed sections beyond the amendments already described. The proposed sections make it clear that a party whose hearing request is denied must seek to obtain party status and then, if unsuccessful, follow procedures for a motion for rehearing as a prerequisite to appeal once the commission has disposed of the application. Since a person who files a hearing request is asking that a contested case hearing be held, that party obtains the relief sought if any hearing request is granted. That person must then seek to be admitted as a party if the person wishes to participate in the case, and decisions on that issue will be handled as they are now, although the commission anticipates that if the person has a complaint at this point, it will be the denial of party status or a limitation of issues rather than a determination on a hearing request. If all hearing requests are denied or withdrawn, persons whose requests are denied have an opportunity for the review of that decision by filing a motion for rehearing after the commission's decision on the application--that is, at the end of the case, rather than in an interlocutory appeal, as the commenters seem to suggest. The commission believes that it is clear in the proposed sections that the time period for appeals begins to run at this point. While the commenters also suggest that it is unreasonable to force parties to go through a hearing and have the result of that hearing reversed by a court based on an error in denying party status, the commission believes that the risk of this kind of result is minimal, is inherent in every determination of party status in any kind of proceeding, and is outweighed by the burden to the public that would be imposed by delaying every permitting decision until determinations of party status are appealed through the court system. Two commenters noted that proposed sec.55.27(f) allows a person whose hearing request is denied to still seek to be admitted as a party, and suggested that absent some compelling reasons, the commission's determination on the hearing request should preclude the later admission of the person as a party. The commission disagrees, and has amended the proposed section as noted previously to make it clear that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. One commenter suggested that proposed sec.55.27 be amended to allow a motion for reconsideration, rather than a motion for rehearing, of the denial of a hearing request, suggesting that the latter is only appropriate in contested cases under the Administrative Procedure Act, and that no contested case arises if a hearing request is not granted. The commission disagrees. As stated previously, the commission believes that a decision on the validity of a hearing request is an interlocutory decision only on the validity of the request, and does not necessarily dictate the outcome of a later decision on party status, or standing. The commission believes that a motion for rehearing at the conclusion of the proceedings is the most appropriate way to review such a decision. Several commenters remarked that the proposed sections do not allow for an adequate record for judicial review when no contested case hearing is held and do not establish standards for a court to use in its review. The commenters also suggest that the proposed sections do not create an adequate record in rulemaking. The commission disagrees, and declines to make changes based on this comment, because it believes that the record created is sufficient for judicial review of the commission's actions, and the standards of review are already clearly established in the statutes and rules. Similarly, the commission believes that the record created in rulemaking proceedings is more than adequate. Several commenters suggested that proposed sec.55.29 and sec.55.31 be revised to provide that the commission accept as true written statements of a person filing a hearing request for the purposes of the determination on the request or the person requesting a hearing be given an opportunity to present evidence to meet the burden of presenting competent evidence under Texas Water Code, sec.5.115. The commission disagrees and declines to make these changes. The first alternative ignores the clear intent of Texas Water Code, sec.5.115, by allowing a person to meet its standards by simply claiming that the standards are met. Texas Water Code, sec.5.115 provides that the commission "is not required to hold a hearing if the commission determines that the basis of the person's hearing request is unreasonable or is not supported by competent evidence." The second alternative does not recognize that this determination will require different procedures in different cases, and the flexibility which the proposed sections provide--from a decision on the pleadings to oral argument to an evidentiary hearing--allows for procedures to be followed which are appropriate for the cases presented. For example, a permit renewal under Texas Health and Safety Code, sec.382.056 may be an example of a case where requests not alleging increases in emissions or compliance problems can be dealt with on the pleadings alone. Similarly, a person who cannot allege a reasonable basis for a hearing request or who cannot allege that competent evidence exists to support the request, despite having more than one opportunity to do so (the request itself, a reply filed under proposed sec.55. 25(f) to responses that point out the merits or deficiencies of the request, and, in appropriate cases, argument or testimony before the commission) is not going to be able to present such evidence at a hearing, and it may be appropriate to resolve this request without an evidentiary hearing. Several commenters suggested that proposed sec.55.31 is unconstitutionally vague and conflicts with other Texas Natural Resource Conservation Commission rules and the law, specifically proposed sec.55.29 and Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115 and that the provisions of proposed sec.55.31(b)(3) are overly burdensome on public participation. The commission disagrees. The commission believes that the proposed section fully complies with the constitution and with Texas Health and Safety Code, sec.382. 056 and Texas Water Code, sec.5.115. The term "reasonableness" is adequately defined by proposed sec.55.31. Further, proposed sec.55.31 does not conflict with proposed sec.55.29, because they deal with different matters--the first with the determination of whether a person is an "affected person," and the second with whether a hearing request is "reasonable." Several commenters suggested that the proposed rules be revised to "provide that the commission will make determinations and record those determinations so that the public can understand the basis for its government's decision and so that a reviewing court can determine if the actions of the commission should be affirmed or reversed." As noted previously, the commission believes that the proposed sections do exactly that and declines to make changes based on this comment. Several commenters suggested that proposed sec.55.33(a)(3) (and presumably proposed sec.80.5(a)(3)) be revised, claiming that the proposed section requires the Chief Clerk to pay the cost for issuing public notices. The commission disagrees, since the proposed section requires the clerk to issue notice and does not provide for the Clerk to pay the cost of notice, since applicants are clearly responsible for those costs. Proposed sec.55.33 has been withdrawn, however, and only proposed sec.80.5 now governs the Chief Clerk's actions in this context. Several commenters noted that the setting procedures of proposed sec.55.33 largely duplicate those of proposed sec.80.5, and suggested the deletion of one or the other. Some commenters suggested conforming these two proposed sections. The commission agrees that these sections are duplicative and should be conformed, and notes as well that proposed sec.70.109 largely duplicates both of these sections. For clarity, the commission believes that it is most logical to lay out all setting procedures only in proposed Chapter 80, and has deleted proposed sec.55.33 and amended proposed sec.70.109 accordingly. Several commenters suggested that the proposed sections of proposed Chapter 70 limit public participation in enforcement proceedings in a fashion that does not meet the federal requirements for such participation and further state that notice in the Texas Register is insufficient. The commission disagrees, and declines to change the proposed sections. The agency complies with federal authorization rules regarding public participation in enforcement matters, which require the agency to have procedures in place for responding to citizen complaints, publish notice of settlements of civil actions, and give assurance that it will not oppose intervention by any citizen when permissive intervention is authorized by statute, rule, or regulation. In regard to the comment that Texas Register publication is insufficient, while the commission disagrees, it is currently considering alternative citizen participation in administrative actions. If rule changes are necessary after a decision is made on this issue, they will be taken up separate from this rulemaking. One commenter suggested that the definitions of "enforcement order," "enforcement action," "petition," and "respondent" be moved from proposed sec.70.2 to proposed sec.3.2. The commission agrees that the definitions of "enforcement action" and "enforcement order" should be moved to sec.3.2 since they are used in general context in other chapters of the agency's rules; however, the terms "petition" and "respondent," as they are defined in proposed Chapter 70, are specific to enforcement actions by the commission only and should remain in proposed Chapter 70. The commission does not believe that generic definitions of petition and respondent are necessary in proposed Chapter 3 to cover permitting matters because those terms are generally accepted legal terminology and "petition" is already included in the definition of "application." One commenter suggested that proposed sec.70.51 substantially changes old sec.337.71 from relating only to water rights enforcement matters to a more general mandatory enforcement hearing process. The commission disagrees. The language in proposed sec.70.51 was taken verbatim from old sec.337.71, except that the title of the subchapter was changed and references to other rules which had been renumbered were changed. The definitions included in old sec.337. 71 included water quality, water rights, hazardous waste releases, and references to the air statute as well. Although the title of old sec.337.71 indicated "Water Rights Enforcement," its statutory basis is Texas Water Code, sec.5.117, which applies to the agency as a whole, and requires the executive director to bring all instances of substantial noncompliance before the commission. The commenter expressed concern that proposed sec.70.51 would require mandatory hearings for incorrect compliance with record keeping requirements in an air permit. Since this would normally not be a substantial noncompliance under the air rules, this section would not apply in that case. Furthermore, old sec.337.71 and proposed sec.70.51 both exclude air violations, since a separate statutory requirement exists for the air program. The program most affected by this statutory requirement is the water quality program, which has a large amount of self-reporting data submitted each month. The proposed section basically sets forth the practice of the watershed management and enforcement divisions in processing this large volume of documents and describes how they determine what constitutes a substantial noncompliance. One commenter suggested that the concept of "executive director preliminary reports" (EDPR), used in proposed sec.70.101, is not necessary in proposed Chapter 70 and is not mandated by statute. While EDPRs are not required by statute, they are clearly allowed and anticipated by statute (see Texas Water Code, sec.sec.13.4151(c) and (d), 26.136(d) and (e), 27.1015(d) and (e), 34. 011(d) and (e) and Texas Health and Safety Code, sec.sec.341.049(c) and (d), 361. 252(d) and (e), 366.0924(d) and (e), 382.088(d) and (f), and 401.384- 401.385). This rulemaking does not alter the provisions in old Chapter 337 regarding preliminary reports, and sets forth the agency's procedures if preliminary reports are chosen as the form of pleading in a case. The executive director is not required to issue a preliminary report, but is given an option which may be used on a case-by-case basis, which is consistent with the statutory provisions. The commission disagrees with the comment and declines to change the proposed section. The commission has determined that the setting procedures of proposed sec.70. 109 largely duplicate those of proposed sec.80.5, and has amended them to simply refer to proposed sec.80.5. The commission has also amended the title of this section for clarity. One commenter suggested that proposed sec.80.3(a) be amended to make it clear that the judge sitting in a phase of a hearing, not the presiding judge, will resolve evidentiary questions raised during that phase of a hearing. The commission generally agrees, but believes that it may be necessary for a judge sitting in one phase of a hearing to refer some important evidentiary questions to the presiding judge, and has amended the section accordingly. Two commenters suggested that proposed sec.80.3(b)(10) be revised to make it clear that the judge may limit the time of presentation of evidence and witnesses without unfairly prejudicing the rights of parties. The commission agrees, and has amended the rule accordingly. In addition, the commission believes that splitting proposed sec.80.3(a) into two subsections and redesignating proposed sec.80.3(b) as sec.80.3(c) makes the proposed rule more readable, and has amended it accordingly. Two commenters suggested that proposed sec.80.5(b) be amended to expressly state that the commission may limit the issues that shall be considered by SOAH in a contested case. The commission agrees that this ability is implicit in Texas Government Code, sec.2003.047(e), and has amended the proposed section accordingly. These commenters also suggest that the proposed section be amended to provide that the commission "may," rather than "shall," identify issues to be addressed. Since Texas Government Code, sec.2003.047(e) uses "shall," the commission disagrees and declines to make this change. The commission has amended proposed sec.80.5(b) to make it clear that the executive director's petition or EDPR serves as the list of issues to be addressed by SOAH in a contested enforcement case. One commenter suggested that proposed sec.55.33(b) (the same as proposed sec.80.5(b)) be deleted, stating that while the commission may want to restrict or direct the list of issues, the proposed section suggests that a referral is not adequate if it does not. The commission disagrees, since Texas Government Code, sec.2003.047(e) clearly mandates an issues list, and since the proposed section gives the commission the flexibility to submit both broad and narrow ranges of issues. Several commenters suggested that proposed sec.80.13 be amended to allow parties, as well as the executive director, to request consolidation of related proceedings. The commission disagrees and declines to change the proposed section, because this is already allowed by the proposed sections. Proposed sec.80.13 allows the executive director to consolidate matters with the permission of the judge, and allows the judge to consolidate matters, presumably on the judge's own motion or that of any party. One commenter noted that due to changes in Chapter 291 of the commission's rules, proposed sec.80.17 does not accurately reflect the burden of proof in certain water and sewer rate cases. The commenter also noted that enforcement cases covered by subsection (c) of the rule should be expressly excepted from subsection (a). The commission agrees, and has amended the proposed section accordingly. One commenter suggested that proposed sec.80.27 be deleted as duplicative of proposed sec.sec.1.08, 1.10, 1.11, and 80.31. While the proposed sections cover similar matters, the commission disagrees and declines to make the change, because proposed sec.80.27 covers mostly matters of form, while the other proposed sections deal with more procedural matters. The commission has amended proposed sec.80.101 to make it clear that the executive director may either act on a matter remanded to the executive director or set it for consideration at a commission meeting. This is allowed by the proposed section, but the amendment lends clarity. One commenter suggested that proposed sec.80.107 is of sufficient importance that it should be dealt with as a separate subchapter. While the commission agrees that the proposed section is important, it prefers as a matter of form at this time not to create additional subchapters, and declines to make the change. One commenter suggested deleting the phrase "administrative law" from a reference in proposed sec.80.107(a)(3) to result in consistent references to the presiding officer as "judge." The commission agrees, and has amended the proposed section accordingly. One commenter suggested amending proposed sec.80.109(b) to define only statutory parties. The commission disagrees, and believes that the proposed section serves a more useful function by referring to all parties to an application, rather than just statutory parties, and declines to make this change. One commenter suggested deleting proposed sec.80.109(c) as duplicative of proposed sec.80.115. The commission agrees, and has amended the proposed section accordingly, renumbering the subsequent subsections. One commenter suggested deleting proposed sec.80.109(d) (now sec.80.109(c)) as duplicative of proposed sec.80.3(b)(5). The commission disagrees, since the section as amended in response to comments on proposed sec.80.115 now makes it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. One commenter suggested moving proposed sec.80.109(e) ((now sec.80.109(d)) to proposed sec.80.119, arguing that it makes more sense to discuss the effects of continuance in that section. The commission disagrees and declines to make the change. Proposed sec.80.109(e) (now sec.80.109(d)) is intended to make it clear that a person designated as a party retains party status regardless of any postponement of a hearing. Since the rule is limited to party status, the commission feels that it makes more sense to leave it in its present location. Several commenters commented that proposed sec.80.111 prohibits the judge and commission from considering comments. The commission disagrees, and points out that the section does not at all impair the executive director's ability to consider comments. The proposed section prohibits the judge from considering protests or comments submitted by non-parties in a non-evidentiary context (not under oath and without the opportunity to cross-examine) as evidence in contested case proceedings. The commission believes this is required by law, and declines to change the proposed section. The commission notes, however, that the phrase "[i]n proceedings other than enforcement proceedings" was inadvertently published as the end of the second sentence of this section, rather than as the beginning of the third sentence. The commission has amended the section accordingly, so that this limitation applies to questions submitted to the judge, not to the consideration of comments. One commenter noted that proposed sec.80.115 is not clear as to whether each and every party has a right to conduct discovery, present a direct case, cross- examine witnesses, obtain copies of pleadings, and so on, even when parties have been aligned under proposed sec.80.109. The commission agrees that the two provisions could be confusing when read together, and has amended proposed sec.80.109(d) to make it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. The commission anticipates that judges will exercise their best judgment when aligning parties and specifying the purposes for which they are aligned. One commenter suggested that proposed sec.80.117(b) be revised to make it clear that all persons granted party status are covered in the order of presentation. The commission agrees, and has amended proposed sec.80.117 by substituting the words "other parties" for the word "protestant." One commenter suggested deleting the word "SOAH" from proposed sec.80.119(d) to make it clear that the section does not restrict the judge in a contested case proceeding to the use solely of SOAH mediators. The commission agrees, and has amended the proposed subsection accordingly. The subsection has also been combined with proposed sec.80.119(c), to make the section shorter and more clear. One commenter suggested combining proposed sec.80.127(a)(2) and (c) to eliminate duplication. The commission agrees, and has amended the proposed section and renumbered subsections accordingly. One commenter suggested that proposed sec.80.127 be revised to more closely track the provisions of Texas Rule of Civil Procedure 267 and Texas Rule of Evidence 613, which prohibit the exclusion from the hearing room when "the rule" is invoked of an officer or employee of a party that is not a natural person and who is designated as its representative by its attorney and a person whose presence is shown by a party to be essential to the presentation of its case. The commission agrees, and has added subsection (f) to the proposed section so that it will more closely track the practice in the courts. One commenter suggested amending proposed sec.80.133 to allow the judge to set a schedule for the submission of written briefs. The commission agrees, and has amended the proposed section accordingly. Two commenters suggested that proposed sec.80.137 be amended to incorporate by reference Texas Rule of Civil Procedure 166a, because of the substantial body of interpretive case law and legal commentary available. The commission agrees that Rule 166a contains valuable guidance, and has tried to track the language of the rule in the proposed section as far as it considers appropriate given the difference between the administrative and judicial processes and the commission's assumption that the most likely use of the proposed section will be to limit issues, rather than to dispose of applications. The commission has accordingly modified the proposed section to track Rule 166a more closely, and anticipates that practitioners and judges will look to Rule 166a and the decisions construing it for guidance. Two commenters suggested that proposed sec.80.137 be amended to change some language relating to testimonial evidence. Because of the amendments noted previously, the commission believes the issue raised by this language to be resolved and declines to make further changes. One commenter suggested that proposed sec.80.151 be amended to expressly refer to Texas Rule of Civil Procedure 215. The commission disagrees, and declines to change the proposed section, because it believes that the grant of authority in Texas Government Code, sec.2003.047 and the sanctions provisions of proposed sec.80.107 already make sufficient provision for sanctions for discovery abuse. One commenter suggested that proposed Subchapter E of Chapter 80 (the "Freeze Rules") be deleted. While the commission recognizes the commenter's concern, it feels that the "freeze rules" have not yet been given a real test in practice, and is inclined to amend, rather than repeal them. The commission has corrected an incorrect reference in proposed sec.80.205 to refer to sec.80.105, rather than sec.80.60. Several commenters suggested that proposed sec.80.203(a)(1) be amended so that it does not require the executive director to prepare a draft permit if the executive director does not recommend the issuance of a permit. The commission disagrees, and declines to make this change, in part because the "freeze rules" were the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome, and in part because the failure to prepare a draft permit would present an almost insuperable barrier to an applicant should the applicant prevail on the issue of whether or not a permit should be issued. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.207(c) be amended to eliminate the additional time proposed beyond the first discovery period for filing a list of issues. The commission disagrees, and declines to make this change. An earlier version of this rule required protestants to have their issues list finished simultaneously with the end of the first discovery period, which the commission believes compresses the work that must be done. The commenter suggested that in the event the additional time remained, additional time should be added to proposed sec.80.207(e) as well. The commission disagrees and declines to make this change, since additional time is already granted by timing the applicant's response from the time the first list of issues is submitted, rather than the close of the first discovery period. Several commenters commented that proposed sec.80.207(d) allows an applicant to disrupt the work required of protestants to comply with subsection proposed sec.80.207(c), and suggested the deletion of the second sentence in subsection (d). The commission disagrees, and declines to make this change. The commenters apparently missed the time extension given in proposed sec.80.207(c), which now allows for completion of the issues list "within 20 days after the end" of the time period originally contained in old sec.265.104, from which the proposed section is derived. The result of the proposed sections is to give the protestant an additional 20 days to complete the issues list, while allowing the applicant to go forward with discovery. The result, rather than an additional burden on the protestant, is an easing of requirements. One commenter suggested that proposed sec.80.207(h) be amended to allow a limited amendment of the application in some circumstances. While the commission agrees that this commenter's point has some merit, the current arrangement was the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.209(c)(3) be amended to require the judge to distribute a prehearing order within four days from the prehearing conference. While the commission recognizes the commenter's concern and the limited (14-day) time period between the prehearing conference and the hearing, it prefers at this time to leave the timing of the prehearing order to the judge, trusting that prehearing orders will be distributed as soon as possible considering the compressed time frame. Two commenters suggested that proposed sec.80.213 be revised to make it clear that paragraphs (1)(A) and (B) are not mutually exclusive and that the judge may direct a party to both voluntarily reduce its listed witnesses and provide a summary of the expected testimony of each witness. One commenter also suggested that the language of the rule be made more clear that the judge may prohibit testimony of witnesses. The commission agrees, and has amended the section accordingly. Several commenters suggested that proposed sec.80.259 be revised to eliminate a provision that would allow a judge to file an amended proposal for decision without serving it on the parties. This provision was included in a redline/strikeout version of the proposed rules distributed by agency staff during the rulemaking process, but was dropped from the proposed rule before publication, and thus no revision to the proposed rule is necessary. The staff regrets any inconvenience caused by failing to notify interested persons of the change before publication. The commission has amended proposed sec.80.263 to make it clear that the general counsel may set time limits for oral presentations before the commission. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.sec.80.265, 80.267, and 80.271 to remove the word "final" where it refers to commission decisions or orders, because the use of the word in these proposed sections may be unintentionally confusing when compared with the use of the word in Government Code, sec.sec.2001.141 - 2001.144, dealing with when decisions become final. One commenter suggested that the provision of proposed sec.80.267(b) that the commission will render a decision within 60 days after the date the hearing is finally closed does not give the commission enough time to render its decisions. The commenter suggested lengthening the time period to 90 days. The commission agrees that cases heard by a judge may take more than 60 days, but notes that the 60-day period is mandated by Texas Government Code, sec.2001. 143 unless extended. The commission believes, however, that proposed sec.80. 267(b) gives the judge enough flexibility to extend the time, and therefore declines to make the suggested revision. The commission has amended proposed sec.80.277 to more clearly reflect the commission's position and longstanding agency practice that the executive director or an authorized representative may forward an enforcement order to the attorney general for enforcement. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.86.18(c)(1)(C) to change the time period for filing applications for rehearing to 30 days to be consistent with Water Code, sec.11.316. One commenter suggested that the definition of "monitoring well" in proposed sec.340.2 be amended to expressly exclude monitoring wells used in conjunction with the production of coal and lignite, as is apparently intended by the general exclusion for wells used in conjunction with the production of "other minerals." The commission agrees, and has amended the section accordingly. One commenter noted that proposed sec.340.73 appears to differ from the requirements under discussion at the agency for sec.338.31 and sec.338.32 as to the persons to whom copies of well logs are to be submitted. The commission agrees, and has amended proposed sec.340.73 and sec.340.75 to add local underground water conservation districts and make these sections consistent. Subchapter A. General Rules 30 TAC sec.sec.80.1, 80.3, 80.5, 80.7, 80.9, 80.11, 80.13, 80.15, 80.17, 80.19, 80.21, 80.23, 80.25, 80.27, 80.29, 80.31, 80.33 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.80.3. Judges. (a) The commission delegates to SOAH the authority to conduct hearings designated by the commission. (b) The chief administrative law judge will assign judges to hearings. When more than one judge is assigned to a hearing, one of the judges will be designated as the presiding judge and shall resolve all procedural and evidentiary questions. Evidentiary questions will ordinarily be resolved by the judge sitting in that phase of the case, but may be referred by that judge to the presiding judge. (c) Judges shall have authority to: (1) set hearing dates; (2) convene the hearing at the time and place specified in the notice for the hearing; (3) establish the jurisdiction of the commission; (4) rule on motions and on the admissibility of evidence and amendments to pleadings; (5) designate and align parties and establish the order for presentation of evidence; (6) examine and administer oaths to witnesses; (7) issue subpoenas to compel the attendance of witnesses, or the production of papers and documents; (8) authorize the taking of depositions and compel other forms of discovery; (9) set prehearing conferences and issue prehearing orders; (10) ensure that information and testimony are introduced as conveniently and expeditiously as possible, including limiting the time of argument and presentation of evidence and examination of witnesses without unfairly prejudicing any rights of parties to the proceeding; (11) limit testimony to matters under the commission's jurisdiction; (12) continue any hearing from time to time and from place to place; (13) reopen the record of a hearing, before a proposal for decision is issued, for additional evidence where necessary to make the record more complete; (14) impose appropriate sanctions; and (15) exercise any other appropriate powers necessary or convenient to carry out his responsibilities. sec.80.5. Referral to SOAH. (a) When a case is referred to SOAH, the chief clerk shall: (1) file with SOAH a Request for Setting of Hearing form, or Request for Assignment of Administrative Law Judge form, whichever is appropriate; (2) coordinate with SOAH to determine a time and place for hearing; (3) issue public notice of the hearing as required by law and commission rules; and (4) send a copy of the chief clerk's case file to SOAH. (b) The commission shall provide to the judge a list of issues or areas that must be addressed. In addition, the commission may identify and provide additional issues or areas that must be addressed to the judge, or may limit issues or areas to be addressed, at any time. In an enforcement case, the executive director's petition or EDPR shall serve as the list of issues or areas that must be addressed. sec.80.11. Conduct and Decorum. (a) Those who attend or participate in hearings should conduct themselves in a manner respectful of the conduct of public business, and conducive to orderly and polite discourse. All those in attendance shall comply with the judge's directions concerning the offer of public comment, and conduct and decorum. (b) In a hearing before a judge, the judge shall first warn a person violating this section to refrain from the specific conduct in violation. Upon further violation of this section by the same person, the judge may exclude that person from the proceeding for such time and under such conditions as necessary to correct the situation. Violation of this section shall also be sufficient cause for the judge to recess the hearing. sec.80.17. Burden of Proof. (a) Except as provided in subsections (b)-(d) of this section, the burden of proof is on the moving party by a preponderance of the evidence. (b) Section 291.12 of this title (relating to Burden of Proof) governs the burden of proof in a proceeding involving a proposed change of water and sewer rates not governed by Subchapter I of Chapter 291 of this title (relating to Wholesale Water or Sewer Service). (c) Section 291.136 of this title (relating to Burden of Proof) governs the burden of proof in a proceeding related to a petition to review rates changed pursuant to a written contract for the sale of water for resale filed under Texas Water Code, Chapter 11 or 12, and in an appeal under Texas Water Code, sec.13.043(f). (d) In an enforcement case, the executive director has the burden of proving by a preponderance of the evidence the occurrence of any violation and the appropriateness of any proposed technical ordering provisions. The respondent has the burden of proving by a preponderance of the evidence all elements of any affirmative defense asserted. Any party submitting facts relevant to the factors prescribed by the applicable statute to be considered by the commission in determining the amount of the penalty has the burden of proving those facts by a preponderance of the evidence. sec.80.21. Witness Fees. (a) A person who is not a party and is compelled to attend any hearing or proceeding or to produce books, records, papers, or other objects is entitled to receive mileage reimbursement if the location of the hearing or proceeding is more than 25 miles from the person's place of residence. Reimbursement shall be at the current rate for state employees. The person is also entitled to receive a minimum fee of $70 or the amount equal to state employees' current maximum travel reimbursement for overnight lodging plus meals, whichever is greater, for each day or part of a day the person is necessarily present as a witness or deponent. This fee shall be paid to the witness or deponent even if overnight lodging is not used, and the fee shall not be prorated for parts of days. (b) Mileage and fees to which a witness is entitled under this section shall be paid by the party at whose request the witness appears or the deposition is taken, on presentation of proper vouchers sworn by the witness and approved by the judge. sec.80.23. Transcriptions of Hearings. (a) Official court reporter. Consistent with its court reporting services agreement, the commission will provide a certified court reporter to make a verbatim record and transcript of any commission meeting, hearing, or other proceeding upon the timely request of any person. The court reporter provided by the commission shall be the official reporter for commission proceedings. If the commission does not provide a court reporter a party may, at its own expense, furnish a certified court reporter whom the commission may designate as the official reporter for the proceeding. (b) Requests for court reporter services. (1) A request for a verbatim record or transcript of a proceeding may be submitted at any time, but shall be submitted in writing to the chief clerk or the judge and shall specify: the name, mailing address, and daytime telephone number of the requester; the name and date of the commission proceeding; and a statement of whether a transcript is requested. A request for a transcript of a proceeding already reported may be made directly to the court reporter. (2) A person requesting a verbatim record without a transcript of a proceeding shall pay the applicable reporting fees in the commission's court reporting services agreement. (3) A person requesting a transcript of a proceeding shall pay for at least an original and two copies of the transcript in addition to any applicable reporting fees in accordance with the commission's court reporting services agreement. The court reporter shall provide the commission the original and one copy of the transcript free of charge. (4) Upon his or her own motion, the judge may request a verbatim record and an original and two copies of a transcript of a proceeding. (5) The judge may require the applicant to pay for the transcript in advance subject to reimbursement from other parties upon assessment of costs. (c) Cancellation of court reporter services. A person who causes the judge or commission to cancel a hearing or meeting for which a verbatim record or transcript has been requested is responsible for paying the court reporter, upon demand, the full daily reporting fee in the commission's court reporting services agreement unless the cancellation occurs more than 24 hours before the scheduled beginning of the hearing or meeting. (d) Assessment of reporting and transcription costs. (1) Upon the timely filed motion of a party or upon its own motion, the commission may assess reporting and transcription costs to one or more of the parties participating in the proceeding. The commission shall consider the following factors in assessing reporting and transcription costs: (A) the party who requested the transcript; (B) the financial ability of the party to pay the costs; (C) the extent to which the party participated in the hearing; (D) the relative benefits to the various parties of having a transcript; (E) the budgetary constraints of a state or federal administrative agency participating in the proceeding; (F) in rate proceedings, the extent to which the expense of the rate proceeding is included in the utility's allowable expenses; and (G) any other factor which is relevant to a just and reasonable assessment of costs. (2) The commission will not assess reporting or transcription costs to statutory parties who are precluded by law from appealing any ruling, decision, or other act of the commission. (3) In any proceeding where the assessment of reporting or transcription costs is an issue, the judge shall provide the parties an opportunity to present evidence and argument on the issue. A judge shall include in the proposal for decision a recommendation for the assessment of costs. (4) The parties may agree upon the division or assessment of reporting and transcription costs. The terms of such an agreement shall be made part of the record of the proceeding. (e) Payment of reporting or transcription assessment. (1) Each party assessed a reporting or transcription cost in a commission proceeding shall pay the assessment in full within ten days after the commission's order is final, as provided by the APA. The assessment shall be paid by check payable to the order of the court reporter firm that reports or transcribes the proceeding, or as otherwise ordered by the commission. Payment shall be remitted to the chief clerk of the commission or as otherwise ordered by the commission. (2) If a party fails to pay the assessment under subsection (a) of this section, the commission may forward the matter to the attorney general of Texas for prosecution and collection. (3) Upon a party's filing a sworn motion showing good cause for failure to pay its assessment under subsection (a) of this section, accompanied by tender of payment of the party's assessment in full, the commission may grant an exception to the time within which payment must have been made under subsection (a) of this section, accept the payment, and otherwise enforce its assessment. (f) Sale of transcript copies. The court reporter may sell copies of a transcript of a commission proceeding in accordance with the commission's court reporting services agreement, but the commission shall not be precluded from complying with the Public Information Act. sec.80.29. Amended and Supplemental Pleadings in Enforcement Cases. (a) Up to seven days before the hearing, parties to an enforcement action may file supplemental or amended pleadings, so long as these deadlines do not operate as an unfair surprise to the opposite party. Amendments after that time will be at the discretion of the judge and may constitute grounds for a continuance. (b) The executive director may amend an enforcement petition to include changes in, but not limited to: (1) the amount of the penalty up to the maximum allowable by statute; (2) the violations alleged; (3) the number of days of occurrence of previously alleged violations; and (4) the injunctive relief (or remedial ordering provisions) sought. (c) The right to change the violations alleged includes the right to add causes of action based on any statutes within the commission's jurisdiction other than the one or ones upon which the executive director's preliminary report in the case was based. sec.80.31. Motions. (a) A motion, unless made during a hearing, shall be made in writing, shall set forth the relief or order sought, and shall be timely filed with the chief clerk. Any reply to the motion shall be timely filed with the chief clerk with copies served on the judge and other parties. Failure to furnish copies may be grounds for withholding consideration of the motion or reply. Motions based on matters which do not appear of record must be supported by affidavit. (b) Motions made during a hearing shall be stated on record or filed with the judge. (c) When necessary in the judgment of the judge or commission, a hearing will be held to consider any motion. sec.80.33. Lost Records and Papers. When any papers or records in the custody and control of the commission are lost or destroyed, the parties, with the approval of the commission, may agree in writing on a brief statement of the matters contained therein or any person may at any time supply such lost records or papers as follows. (1) Any person may make a written sworn motion before the commission stating the loss or destruction of such record or papers, accompanied by certified copies of the originals, if obtainable, or by substantially correct copies . (2) If, upon hearing, the commission is satisfied that they are substantially correct copies of the original, an order will be entered substituting such copies for the missing originals. (3) Such substituted copies will be filed with and constitute a part of the record and have the force and effect of the originals. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606788 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter C. Hearing Procedures 30 TAC sec.sec.80.101, 80.103, 80.105, 80.107, 80.109, 80.111, 80. 113, 80.115, 80.117, 80.119, 80.125, 80.127, 80.129, 80.131, 80.133, 80.135, 80.137 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.80.101. Remand to Executive Director. After providing opportunity for all affected persons to be named parties, a judge may remand an application to the executive director if all hearing requests have been withdrawn or all parties to a contested case reach a settlement so that no facts or issues remain controverted. After remand, the application shall be uncontested, the applicant is deemed to have agreed to the action of the executive director, and all hearing requests are deemed withdrawn. The executive director may act on the application or set it for a commission meeting. sec.80.105. Preliminary Hearings. (a) After the required notice has been issued, the judge shall convene a preliminary hearing to consider the jurisdiction of the commission over the proceeding. A preliminary hearing is not required in an enforcement matter. (b) If jurisdiction is established, the judge shall: (1) accept public commentary and name the parties; (2) set a discovery and procedural schedule including a mechanism for the timely and expeditious resolution of discovery disputes; and (3) allow the parties an opportunity for settlement negotiations. (c) When agreed to by all parties in attendance at the preliminary hearing, the judge may proceed with the evidentiary hearing on the same date of the first preliminary hearing. (d) One or more preliminary hearings may be held to discuss: (1) formulating and simplifying issues; (2) evaluating the necessity or desirability of amending pleadings; (3) all pending motions; (4) stipulations; (5) the procedure at the hearing; (6) specifying the number and identity of witnesses; (7) filing and exchanging prepared testimony and exhibits; (8) scheduling discovery; (9) setting a schedule for filing, responding to, and hearing of dispositive motions; and (10) other matters that may expedite or facilitate the hearing process. sec.80.107. Sanctions. (a) On the judge's own motion or on motion of a party and after notice and an opportunity for a hearing, a judge may impose sanctions against a party or its representative for: (1) filing a motion or pleading that is groundless and brought: (A) in bad faith; (B) for the purpose of harassment; or (C) for any other improper purpose, such as to cause unnecessary delay or needless increase in the cost of the proceeding; (2) abuse of the discovery process in seeking, making, or resisting discovery; or (3) failure to obey an order of the judge or the commission. (b) A sanction imposed under this section may include, as appropriate and justified, issuance of an order: (1) disallowing further discovery of any kind or of a particular kind by the offending party; (2) charging all or any part of the expenses of discovery against the offending party or its representatives; (3) holding that designated facts be considered admitted for purposes of the proceeding; (4) refusing to allow the offending party to support or oppose a designated claim or defense or prohibiting the party from introducing designated matters in evidence; (5) disallowing in whole or in part requests for relief by the offending party and excluding evidence in support of those requests; and (6) striking pleadings or testimony, or both, in whole or part. sec.80.109. Designation of Parties. (a) Determination by judge. All parties to a proceeding shall be determined at the preliminary hearing or when the judge otherwise designates. To be admitted as a party, a person must have a justiciable interest in the matter being considered and must, unless the person is specifically named in the matter being considered, appear at the preliminary hearing in person or by representative and seek to be admitted as a party. After parties are designated, no other person will be admitted as a party except upon a finding that good cause and extenuating circumstances exist and that the hearing in progress will not be unreasonably delayed. At the discretion of the judge, persons who are not parties may be permitted to make or file statements. (b) Parties. (1) The executive director and public interest counsel of the commission are parties to all commission proceedings. (2) The applicant is a party in a hearing on its application. (3) Affected persons shall be parties to hearings on permit applications, based upon the standards set forth in sec.55. 29 of this title (relating to Determination of Affected Person). (4) The Texas Water Development Board shall be a party to any commission proceeding in which the board requests party status. (5) The Texas Parks and Wildlife Department shall be a party in commission proceedings on applications for permits to store, take, or divert water if the department requests party status. (6) The parties to a contested enforcement case include the respondent(s), and any other parties authorized by statute. (7) The parties to a hearing upon a challenge to commission rules include the person(s) challenging the rule and any other parties authorized by statute. (8) The parties to a permit revocation action initiated by a person other than the executive director shall include the respondent and the petitioner. (c) Alignment of participants. Participants (both party and non-party) may be aligned according to the nature of the proceeding and their relationship to it. The judge may require participants of an aligned class to select one or more persons to represent them in the proceeding. Unless otherwise ordered by the judge, each group of aligned participants shall be considered to be one party for the purposes of sec.80.115 of this title (relating to Rights of Parties) for all purposes except settlement. (d) Effect of postponement. If a hearing is postponed for any reason, any person already designated as a party retains party status. sec.80.111. Persons Not Parties. Persons not designated as parties may register protests or make comments orally or in writing. These protests or comments shall be included in the files of the proceeding, but shall not be considered by the judge as evidence in the record. In proceedings other than enforcement proceedings, these persons may, at the judge's request, submit questions to the judge. The judge may address any such questions to witnesses where it appears that this questioning may lead to a full disclosure of the facts without unduly delaying the hearing or burdening the record. sec.80.113. Appearance. (a) Any person may appear at a hearing in person or by authorized representative. A person appearing in a representative capacity may be required to prove his authority. (b) Except for good cause, the applicant or petitioner shall appear at the public hearing. Failure to so appear may be grounds for withholding consideration of a matter or for dismissal without prejudice. (c) An affidavit may be made by either the party or a representative, unless otherwise provided by statute. (d) Failure to appear at an enforcement hearing may result in a default order under sec.70.106 of this title (relating to Default Orders). sec.80.115. Rights of Parties. (a) A party has the right to conduct discovery, present a direct case, cross- examine witnesses, make oral and written arguments, obtain copies of all pleadings, motions, replies, and other filed documents, receive copies of all notices issued by the commission concerning the proceeding to which the person is a party, and, as directed by the judge, otherwise fully participate as a party in the proceeding. (b) Except in enforcement matters, a person may seek leave to withdraw his or her party status at any time upon written request to the judge or by request stated on the record during a hearing. Party status is not withdrawn unless and until the judge grants the request for leave to withdraw. sec.80.117. Order of Presentation. (a) In all proceedings, the moving party has the right to open and close. Where several matters have been consolidated, the judge will designate who will open and close. The judge will determine at what stage other parties will be permitted to offer evidence and argument. After all parties have completed the presentation of their evidence, the judge may call upon any party for further material or relevant evidence upon any issue. (b) In a permit hearing, the executive director shall open with a simple statement of his preliminary position on the application and, in a permit hearing, will present the draft permit including special provisions, if any. The applicant shall then present evidence to meet its burden of proof on the application, followed by other parties, the public interest counsel, and the executive director. In all cases, the applicant shall be allowed a rebuttal. Any party may present a rebuttal case when another party presents evidence that could not have been reasonably anticipated. (c) In all contested enforcement case hearings, the executive director has the right to open and close. In all such cases, the executive director shall be allowed to close with his rebuttal. sec.80.119. Continuance. (a) The judge may continue a hearing from time to time and from place to place. If the time and place for the hearing to reconvene are not announced at the hearing, a notice shall be mailed at a reasonable time to all parties and other persons who, in the opinion of the judge, may be affected by action taken as a result of the hearing. (b) Motions for continuance shall be in writing or stated on the record, and shall be sworn unless the facts alleged therein to show good cause are part of the record of the proceeding. (c) Upon joint motion of all parties, the judge may continue the hearing to allow the parties to use alternative dispute resolution procedures or to engage in and complete settlement negotiations. sec.80.127. Evidence. (a) General admissibility of evidence. (1) Irrelevant, immaterial, or unduly repetitious evidence shall be excluded. The Texas Rules of Civil Evidence, as applied in nonjury civil cases in the district courts of this state, shall be followed. When necessary to ascertain facts not reasonably susceptible of proof under those rules, evidence not admissible under those rules may be admitted, except where precluded by statute, if it is of a type commonly relied upon by reasonably prudent people in the conduct of their affairs. The judge shall give effect to the rules of privilege recognized by law. (2) Testimony will be received only from witnesses called by a party or the judge. The judge may allow or request testimony from any person whose position is not adequately represented by any party, subject to cross-examination by all parties. Such testimony shall only be allowed at the judge's discretion. All parties shall have an opportunity to conduct discovery of such person. (3) Testimony offered by any witness shall be under oath. (b) Stipulation. Evidence may be stipulated by agreement of all parties. The judge and commission will determine the weight, if any, to be accorded stipulated evidence. (c) Prefiled testimony and exhibits. The judge may require or allow parties to prepare their direct testimony in written form if the judge determines that a proceeding will be expedited and that the interests of the parties will not be prejudiced substantially. The judge may require the parties to file and serve their direct testimony and exhibits before the beginning of the hearing. The prepared testimony of a witness upon direct examination, either in narrative or question and answer form, may be admitted into evidence as if read or presented orally, upon the witness' being sworn and identifying the same as a true and accurate record of what the testimony would be if given orally. The witness shall be subject to cross-examination, and the prepared testimony shall be subject to objection. (d) Exhibits. (1) Exhibits of a documentary character shall not exceed 8 by 11 inches unless they are folded to the required size. Maps and drawings which are offered as exhibits shall be rolled or folded so as not to unduly encumber the record. Exhibits not conforming to this rule may be excluded. (2) Each exhibit offered shall be tendered for identification and placed in the record. Copies shall be furnished to the judge, each of the parties, and the hearings reporter, unless the judge rules otherwise. (3) If an exhibit has been identified, objected to, and excluded, it may be withdrawn by the offering party. If withdrawn, the exhibit will be returned and the offering party waives all objections to the exclusion of the exhibit. If not withdrawn, the exhibit shall be included in the record for the purpose of preserving the objection to the exclusion of the exhibit. (e) Official notice. (1) The judge may take official notice of all facts judicially cognizable. In addition, the judge may take official notice of any generally recognized facts within the specialized knowledge of the commission. (2) The judge shall notify all parties of any material officially noticed, including any memoranda or data prepared by the executive director and relied upon by the commission in prior proceedings. All parties shall be afforded an opportunity to contest any material so noticed. (f) Invoking the "rule." At the request of any party, and subject to the discretion of the judge, witnesses may be placed under "the rule" as provided by, and subject to the conditions of, Texas Rule of Civil Procedure 267 and Texas Rule of Evidence 613. sec.80.133. Oral Argument. At the conclusion of the hearing, oral argument may be heard upon request of the parties or at the judge's direction. The judge may prescribe reasonable time limits, and may require or accept written briefs in lieu of oral arguments. sec.80.137. Summary Disposition. (a) Motion. After the preliminary hearing and up to 21 days before the evidentiary hearing, a party may file a motion for a summary disposition of all or any part of an action. The motion shall state the specific issues upon which summary disposition is sought, the specific grounds justifying the summary disposition. Except upon leave of the judge, with notice to opposing parties, the motion any supporting affidavits, and any other relevant documentary evidence shall be filed and served at least 21 days before the date set for ruling on the motion. (b) Written response. Except upon leave of the judge , a party may file and serve a written response, any supporting affidavits, and any other relevant documentary evidence at least seven days before the date set for ruling on the motion. (c) Summary disposition. Summary disposition shall be rendered if the pleadings, admissions, affidavits, stipulations, deposition transcripts, interrogatory answers, other discovery responses, exhibits and authenticated or certified public records, if any, on file in the case at the time of the hearing, or filed thereafter and before judgment with the permission of the judge, show that there is no genuine issue as to any material fact and the moving party is entitled to summary disposition as a matter of law on all or some of the issues expressly set out in the motion or in an answer or any other response. (d) Testimony. A summary disposition may be based on uncontroverted testimonial evidence of an interested witness, or of an expert witness as to subject matter concerning which the judge must be guided solely by the opinion testimony of experts. The evidence must be clear, positive and direct, otherwise credible and free from contradictions and inconsistencies, and could have been readily controverted. No oral testimony shall be received at a hearing on a motion for summary disposition. (e) Appendices, references and other use of discovery not otherwise on file. Discovery products not on file with the chief clerk may be used as summary disposition evidence if copies of the material, appendices containing the evidence, or a notice containing specific references to the discovery or specific references to other instruments, are filed and served on all parties together with a statement of intent to use the specified discovery as summary disposition proofs: (1) at least 21 days before the date set for ruling on the motion if such proofs are to be used to support the summary disposition; or (2) at least seven days before the date set for ruling on the motion if such proofs are to be used to oppose the summary disposition. (f) Form of affidavits; further testimony. Supporting and opposing affidavits shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein. Sworn or certified copies of all papers or parts thereof referred to in an affidavit shall be attached thereto or served therewith. The judge may permit affidavits to be supplemented or opposed by depositions or by further affidavits. Defects in the form of affidavits or attachments will not be grounds for reversal unless specifically pointed out by objection by an opposing party with opportunity, but refusal, to amend. (g) When affidavits are unavailable. Should it appear from the affidavits of a party opposing the motion that he cannot for reasons stated present by affidavit facts essential to justify his opposition, the judge may refuse the application for judgment or may order a continuance to permit affidavits to be obtained or depositions to be taken or discovery to be had or may make such other order as is just. (h) Argument and ruling on motion. At the discretion of the judge, a hearing may be held and oral argument may be presented on the motion. The judge may rule on the motion with or without a hearing. (i) Disposition of motion. If the judge grants a motion for summary disposition on all parts of an action, the judge shall close the hearing and prepare a proposal for decision. If the judge grants a motion for summary disposition on any part of an action, the judge shall not take evidence or hear further argument upon that part of the action, and shall enter an order specifying the facts that appear without substantial controversy, and directing such further proceedings as are just. Upon the hearing of the application the facts so specified shall be deemed established, and the hearing shall be conducted accordingly. (j) Proposal for decision. At the close of the hearing, the judge shall include in the proposal for decision a statement of reasons, findings of fact and conclusions of law in support of any summary disposition rendered. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606789 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter D. Discovery 30 TAC sec.sec.80.151, 80.153, 80.155 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.80.155. Form of Subpoena. The heading of the subpoena shall be "The State Office of Administrative Hearings." It shall state the style of the hearing, that the hearing is pending before SOAH, the time and place at which the witness is required to appear, and the party at whose insistence the witness is summoned. It shall be signed by the judge, but need not be under the seal of SOAH and the date of issuance shall be noted thereon. It may be made returnable forthwith, or on any date for which hearing of the docketed matter may be set. It shall be addressed to any sheriff or constable of the State of Texas or other person authorized to serve subpoenas as provided in Rule 178, Texas Rules of Civil Procedure. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606790 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter E. Freezing the Process 30 TAC sec.sec.80.201, 80.203, 80.205, 80.207, 80.209, 80.213, 80. 215 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.80.201. Applicability. (a) This subchapter applies to permit hearings as designated in the hearing notice, except as provided as follows, as well as to other hearings designated by the judge for good cause. (1) Unless the parties agree, this subchapter does not apply to permit hearings at which jurisdiction is established before July 22, 1994. (2) Notwithstanding the designation made in the notice of hearing, an application may either be included in, or excluded from, the applicability of this subchapter or any portion of this subchapter by: (A) agreement of the parties with the judge's approval; or (B) the judge for good cause. Good cause may include without limitation a finding that the lack of complexity of a proceeding in a hearing does not warrant the implementation of all or a portion of this subchapter. (b) When evaluating whether this subchapter should apply to a permit hearing, the judge shall consider at a minimum: (1) the number and sophistication of the parties or potential parties; (2) the expected length of the hearing; and (3) the complexity of the issues. The judge shall allow the parties to present evidence and argument regarding this determination. (c) If a judge orders a contested case hearing to be placed under the provisions of this subchapter after the notice of hearing, the judge shall allow reasonable time for all parties to comply with the requirements of this subchapter. (d) The commission rules for contested case hearings apply to cases conducted under this subchapter, unless those rules conflict with this subchapter. sec.80.205. First Preliminary Hearing. In addition to following sec.80.105 of this title (relating to Preliminary Hearings), the following shall be done at the first preliminary hearing: (1) the executive director shall: (A) provide the draft permit; (B) present the executive director's recommendation on the draft permit; and (C) provide any additional documents related to the executive director's recommendation on the permit; (2) the applicant shall: (A) submit proposed findings of fact and conclusions of law; (B) identify what constitutes the application; and (C) provide a total of two copies of the permit application, for use by all of the protestants in the case. These copies shall include all notices of deficiency and the applicant's response to those notices; (3) the executive director and the applicant shall provide witness lists with addresses, phone numbers, resumes, and expected area of testimony for each witness. These lists may be amended to address the protestants and public interest counsel's lists of issues. sec.80.207. Discovery. (a) Generally. Except when the judge orders otherwise, discovery in hearings held under this subchapter will be separated into three distinct periods. Within the time frame set for each period in this subsection, the judge shall have discretion to set the duration of each discovery period. (b) First discovery period. The first discovery period shall last 30 to 80 days beginning immediately after jurisdiction is established. This period is reserved for the protestants' discovery from the applicant. The applicant may conduct limited discovery related to the nature of each protestant (including, for example, the type and date of organization, purpose, and number of members) and whether their source of funding is by a competitor of the applicant. (c) Protestants' first list of issues. Within 20 days after the end of the first discovery period, the protestants shall: (1) identify issues based on the applicant's proposed findings of fact and conclusions of law; (2) include a statement as to the reasonable basis of the protestant's dispute on each issue. It is not a reasonable basis that the applicant has the burden of proof or has not yet proven the assertions in the application; (3) raise other issues not based on the applicant's findings of fact and conclusions of law; (4) submit proposed findings of fact and conclusions of law; and (5) submit witness lists, including addresses, phone numbers, resumes, and expected area of testimony for each witness. (d) Second discovery period. The second discovery period shall last 30 to 80 days beginning immediately after the protestants' list of issues is submitted. The applicant may begin discovery immediately after the end of the first discovery period, before the protestant submits its list of issues, but this time shall not count in calculating the time for the second discovery period. Discovery during this period shall consist of: (1) the protestants' discovery from the executive director; (2) the applicant's discovery from the protestants and the executive director; and (3) the executive director's discovery from the protestants and the applicant. (e) Applicant's response. No later than the last day of the second discovery period the applicant may amend the application or proposed findings of fact and conclusions of law to respond to the issues raised by the other parties. Given the nature and degree of amendment, the judge may remand the application to the executive director for further technical review. The applicant may be subject to additional notice, discovery, and hearing requirements. After the time for filing a response under this subsection, the applicant may not file any amendment to its application except as allowed in subsection (h) of this section. (f) Third discovery period. This period shall last 20 to 45 days immediately following the conclusion of the second discovery period. During this period, any discovery by the protestant or the applicant from the executive director shall be limited to the executive director's position regarding the applicant's response, and the executive director's position regarding the protestants' issues. Discovery from the applicant and the protestants shall be limited to the scope of the protestants' first list of issues and the applicant's response. The judge shall have discretion to limit or expand discovery in this period in the interest of fairness. The judge shall decide which time period listed in subsections (b) or (d) of this section applies to discovery for parties that do not fit into a listed category. (g) Protestants' second list of issues. On or before the last day of the third discovery period, protestants may submit a second list of issues. The protestants' second list of issues shall be limited in scope to the applicant's response provided under subsection (e) of this section. (h) Applicants' second response. The applicant may respond to issues raised in the protestants' second list of issues within seven days after the third discovery period. The judge may allow the applicant to respond with a minor amendment and proposed findings of fact and conclusions of law limited to protestants' second list of issues, within seven days after the third discovery period. At the prehearing conference, the judge will consider issues related to any minor amendment filed by the applicant for inclusion in the final issue list. After the time for filing a response under this subsection, the applicant may not file any amendment except by agreement of the parties. (i) Discovery from executive director. Discovery may be sought of the executive director only according to the following provisions. (1) After jurisdiction is taken, all parties shall have access to all unprivileged documents in the agency's files without submitting a Public Information Act request or a request for production. The agency shall ensure that privileged documents are removed from agency public files and that all assertions of privilege are made when jurisdiction is taken or in another timely manner. (2) The executive director shall answer interrogatories and requests for production during the second and third discovery periods. (3) The executive director shall be subject to depositions during the second and third discovery periods (j) Interrogatories. (1) In the first or second discovery period, each party shall be allowed to serve one set of interrogatories, as permitted in the Texas Rules of Civil Procedure. If the applicant uses interrogatories during the first discovery period, the interrogatories shall be considered part of the total number of interrogatories the applicant is allowed during the second discovery period. (2) In the third discovery period, each party shall also be allowed a second set of 20 interrogatories. sec.80.209. Freezing the Process. (a) Prehearing filings. The applicant and protestants shall file findings of fact and conclusions of law, and all parties shall file stipulations to other parties' findings of fact and conclusions of law at least three working days before the prehearing conference. All parties may file motions to limit issues or other pretrial motions before the prehearing conference. Other parties may respond to these motions before or during the prehearing conference. (b) Prefiled exhibits. Exhibits shall be offered and marked and the judge will rule on their admissibility insofar as possible. At hearing, all objections to exhibits which could have been cured if raised in a timely manner, shall be deemed waived if they were not raised during the prehearing conference. Parties wishing to offer exhibits at any time subsequent to the prehearing conference shall notify all other parties as soon as practicable of their intention to seek leave to submit additional exhibits. The judge has the discretion to permit the offer of additional exhibits for good cause. Good cause includes the need for one party to prepare an exhibit in response to another party's exhibit first seen at the prehearing conference, the need to prepare an exhibit in response to the direct testimony of another party, and other cases which are justified by the party seeking to submit the exhibit. (c) Prehearing conference and order. Between seven and 14 days after the end of the third discovery period, the judge shall hold a prehearing conference. (1) The judge shall decide which issues remain and which findings of fact and conclusions of law have been stipulated. Proposed findings and conclusions shall be treated as follows. (A) A proposed finding or conclusion stipulated by all parties shall be regarded as established. (B) A proposed finding or conclusion that has not been stipulated, and that the other parties have a reasonable basis for contesting, may be raised as an issue at the hearing. During the prehearing conference, the judge may inquire further into the reasonableness of the basis for contesting the issue. If the judge determines that the other parties have not shown a reasonable basis for contesting the finding or conclusion and the executive director did not raise the issue as a basis for permit denial, the judge shall deem the finding or conclusion stipulated. (2) The judge shall set final time limits at or before the prehearing conference. (3) The judge shall promptly incorporate all rulings in a written prehearing order. (d) Prefiled testimony. The judge may specify time to submit prefiled testimony before final preparation under subsection (n) of this section. (e) Failure to comply with schedules. Parties who do not identify issues, make amendments, propose findings of fact and conclusions of law, or submit responses according to the schedules established under this subchapter and with the judge's orders will be deemed to have waived the right to pursue them in an evidentiary hearing conducted under this subchapter. (f) Final preparation. Final preparation for hearing shall extend no more than 14 calendar days from the date of the prehearing conference or from the time the last pre-filed testimony is submitted. (g) Evidentiary hearing. The evidentiary hearing shall not be longer than 25 days unless, for good cause, the judge extends the time. The judge shall set reasonable time limits for each party to present its case. (h) Modification of schedules. The scheduled periods set out in this section are presumptive time limits, but the judge may modify them for good cause. Good cause may include without limitation a finding that the complexity or lack thereof of a proceeding warrants modification of one or more of the scheduled periods. (i) Motion for rehearing. A party may not raise for the first time on motion for rehearing an issue of fact or law that it has not previously raised as a contested issue unless the issue is related to: (1) a procedural irregularity; or (2) changed circumstance, where the issue is material and a party demonstrates good cause for failure to raise it as an issue before the prehearing conference. Notwithstanding the foregoing, the commission may exercise its discretion to address an issue not raised by the other parties or remand an issue depending on the evidence in the record. sec.80.213. Limiting the Number of Witnesses. At the request of a party or on the judge's own motion, the judge may prohibit the testimony of unnecessary or excessive numbers of witnesses as follows. (1) The judge may direct a party to do one or both of the following: (A) voluntarily reduce its listed witnesses to a specified number; or (B) provide a summary of the expected testimony of each witness sufficiently specific to show the need for the testimony. (2) The judge may use the witness lists and any summaries of testimony to strike witnesses whose testimony would be unduly repetitious or irrelevant, or to render discovery and the hearing process manageable. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606791 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter F. Post Hearing Procedures 30 TAC sec.sec.80.251, 80.253, 80.255, 80.257, 80.259, 80.261, 80. 263, 80.265, 80.267, 80.269, 80.271, 80.273, 80.275, 80.277, 80.279 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.80.251. Judge's Proposal for Decision. (a) Judge's Proposal for decision. After closing the hearing record, the judge will file a written proposal for decision with the chief clerk within 30 working days and will send a copy by certified mail to each party. If the judge is unable to file the proposal within the 30 days, the judge shall request an extension from the commission by filing a request with the chief clerk. Neither the judge's failure to request an extension, the commission's failure to grant the requested extension, nor the judge's failure to file the proposal within the 30 day or extended period shall in any way affect the validity of the judge's proposal for decision or the commission's jurisdiction, consideration, or action relative to the proposal for decision. (b) Proposal for decision: adverse to a party. A proposal for decision shall be filed by the judge who conducted the hearing or by a substitute judge who has read the record. If the proposal for decision is adverse to a party to the proceeding, it shall contain a statement of the reasons for the proposal, as well as findings of fact and conclusions of law which support the proposal. If any party has filed proposed findings of fact upon the judge's request, the judge shall include with the proposal for decision recommended rulings on all findings of fact so proposed. Where more than one judge has been assigned to hear a particular proceeding, the presiding judge will issue the proposal for decision and the other assigned judge or judges may file comments. (c) Proposal for decision: not adverse to any party. If the proposal for decision is not adverse to any party to the proceeding, the judge may informally dispose of the matter by proposing to the commission an order which need not contain findings of fact, conclusions of law, or reasons for the proposal. If the proposal for decision is not adverse to any party and a permit is to be issued, the judge need not propose an order to the commission. sec.80.253. Enforcement Proposal for Decision. (a) In an enforcement case, a proposal for decision shall also include a proposal for remedial relief (technical ordering provisions) where appropriate, and one of the following recommendations: (1) that a violation has occurred and that a specific amount of penalties should be assessed; (2) that a violation has occurred but that no penalty should be assessed; or (3) that no violation has occurred. (b) When recommending an administrative penalty, the judge shall analyze each factor prescribed by the applicable statute to be considered by the commission in determining the amount of the penalty. The judge shall recommend to the commission an appropriate penalty amount based upon the evidence presented at the hearing and the factors given in the applicable statutes. (c) Weight to be given by the judge to individual statutory factors for determining penalty amount need not be equal and may vary depending on the facts of the particular case. The absence of evidence as to any particular factor does not negate the ability of the judge to arrive at a finding of an appropriate penalty based upon the totality of the circumstances, though such lack of evidence may be a factor in determining the penalty amount. sec.80.257. Pleadings Following Proposal for Decision. (a) Pleadings. Unless right of review has been waived, any adversely affected party may, within 20 days after the date of issuance of the proposal for decision, file exceptions or briefs. Proposed findings of fact may be filed when permitted or requested by the commission. Any replies to exceptions, briefs, or proposed findings of fact shall be filed within 30 days after the date of issuance of the proposal for decision. (b) Change of filing deadlines. On his own motion or at the request of a party, the general counsel may change the deadlines to file pleadings following the proposal for decision. A party requesting a change must file a written request with the chief clerk, and must serve a copy on the general counsel, the judge, and the other parties. The request must explain that the party requesting the change has contacted the other parties, and whether the request is opposed by any party. The request must include proposed dates (preferably a range of dates) and must indicate whether the judge and the parties agree on the proposed dates. sec.80.263. Oral Presentation Before the Commission. In proceedings where a judge has held a public hearing and has issued a proposal for decision or other report to the commission, all oral presentations before the commission shall be limited to five minutes each, excluding time for answering questions, unless the chairman or general counsel establishes other limitations. Before the commission meeting, the general counsel may allot time for oral presentations. Oral presentations and responses to questions shall be directed to the commission. sec.80.265. Reopening the Record. The commission, on the motion of any party or on its own motion, may order the judge to reopen the record for further proceedings on specific issues in dispute. The commission's order shall include instructions as to the subject matter of further proceedings and the judge's duties in preparing supplemental materials or revised orders based upon those proceedings for the commission's final adoption. sec.80.267. Decision. (a) Decision. The commission shall make its decision upon the expiration of 30 days or later following service of the judge's proposal for decision, unless the parties have waived review. The decision, if adverse to any party, shall include findings of fact and conclusions of law separately stated. If any party has filed proposed findings of fact at the request of the judge, the commission will include in its decision a ruling on the proposed findings of fact, unless waived by the party. (b) Prompt decision. The commission's decision will be rendered within 60 days after the date the hearing is finally closed. In a case heard by a judge, a longer period of time may be necessary in order to present the matter to the commission for decision. If additional time is likely to required, that fact shall be announced by the judge at the conclusion of the hearing. sec.80.271. Motion for Rehearing. (a) Filing motion. Except as provided by the APA, a motion for rehearing is a prerequisite to appeal. The motion shall be filed with the chief clerk within 20 days after the date the party or his attorney of record is notified of the decision or order. A party or attorney of record is presumed to have been notified on the date that the decision or order is mailed by first-class mail. On or before the date of filing of a motion for rehearing, a copy of the motion shall be mailed or delivered to all parties with certification of service furnished to the commission. The motion shall contain: (1) the name and representative capacity of the person filing the motion; (2) the style and official docket number assigned by SOAH, and official docket number assigned by the commission; (3) the date of the decision or order; and (4) a concise statement of each allegation of error. (b) Reply to motion for rehearing. A reply to a motion for rehearing must be filed with the chief clerk within 30 days after the date a party or his attorney of record is notified of the decision or order. A party or attorney of record is presumed to have been notified on the date that the decision or order is mailed by first-class mail. (c) Ruling on motion for rehearing. (1) Upon the request of the general counsel or a commissioner, the motion for rehearing will be scheduled for consideration during a commission meeting. Unless the commission extends time or rules on the motion for rehearing within 45 days after the date the party or his attorney of record is notified of the decision or order, the motion is overruled by operation of law. (2) A motion for rehearing may be granted in whole or in part. When a motion for rehearing is granted, the decision or order is nullified. The commission may reopen the hearing to the extent it deems necessary. Thereafter, the commission shall render a decision or order as required by this subchapter. (d) Extension of time limits. With the agreement of the parties or on their own motion, the commission or the general counsel may extend the period of time for filing motions for rehearing and replies and for taking action on the motions so long as the period for taking agency action is not extended beyond 90 days after the decision or order. (e) Motion overruled. In the event of an extension, the motion for rehearing is overruled by operation of law on the date fixed by the order, or in the absence of a fixed date, 90 days after the date of the decision or order. sec.80.277. Appeals of Enforcement Orders. (a) Within the 30-day period immediately following the day on which the commission's order in a contested case is final, in accordance with the APA, the person charged with a penalty shall pay the penalty in full. (b) The person assessed a penalty by the commission may suspend enforcement of the penalty while seeking judicial review by forwarding the amount of the penalty to the commission for placement in an escrow account or posting with the commission a supersedeas bond payable to the Texas Natural Resource Conservation Commission for the amount of the penalty, within the 30-day period immediately following the day on which the commission's order is final. (c) In the event the person assessed fails to take any of the actions in subsections (a) and (b) of this section, the executive director or an authorized representative may forward the matter to the attorney general for enforcement. (d) In the event that the final appellate determination is against the person assessed a penalty, he or she shall pay the commission the full amount of the penalty, and the commission shall deposit the amount of the penalty in the state treasury to the credit of the general revenue fund. (e) To the extent that the final appellate determination is in favor of the person assessed, he or she shall be absolved of liability for payment of that portion of the amount of the penalty as is required to comply with that determination, and the commission shall return that amount of the penalty assessed which is excessive according to that determination, or any amount of the supersedeas bond or escrow account filed with the commission for the purpose of suspending the enforcement of the penalty while seeking judicial review which is in excess of the final penalty determination with a certificate of its return. (f) Any supersedeas bond or escrow account filed with the commission for the purpose of suspending the enforcement of the penalty while seeking judicial review of the final decision of the commission shall be drawn according to a form on file in the Office of the Chief Clerk. Upon request, the chief clerk shall certify the receipt of the amount of any penalty received by the commission for the purpose of suspending the enforcement of the penalty while seeking judicial review. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606762 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Chapter 86. Special Provisions for Contested Case Hearings The commission adopts new sec.sec.86.1, 86.11-86.18, 86.31-86.36, 86.51-86. 59, 86.91-86.101, and 86.130-86.132, concerning procedural rules. Sections 86. 1, 86.11, 86.15, 86.16, 86.18, 86.34, 86.55, 86.96, 86.98, 86.99, and 86. 130- 86.132 are adopted with changes to the proposed text as published in the March 19, 1996, issue of the Texas Register (21 TexReg 2150). Sections 86.12-86.14, 86.17, 86.31-86.33, 86.35, 86.36, 86.51-86.54, 86.56-86.59, 86. 91-86.95, 86.97, 86.100, and 86.101 are adopted without changes and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. Comments were received from Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts. Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts generally supported the adoption of the proposed sections with some changes. Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund, while apparently not opposing the adoption of the proposed sections as a whole, generally expressed concerns related to public participation and issues related to delegated federal programs. A number of commenters suggested minor editorial, typographical, and grammatical changes to clarify or shorten the proposed sections. The commission generally agrees with these suggestions, and has amended the proposed sections accordingly. These changes have been made to proposed sec.sec.1.1, 1.5, 1.7, 1.10, 1.11(a), 3.2, 5.3, 5.8, 5.10, 5.11, 5.12, 5.14, 10. 1, 10.2, 10.3, 10.6, 10.8, 20.17, 40.5, 40.6, 40.8, 40.9, 50.13, 50.17, 50.31, 55.21, 55.23, 55.25, 55.27, 55.29, 55.31, 70.2, 70.3, 70.4, 70.5, 70.6, 70.7, 70.8, 70.9(b), 70.10, 70.11, 70.101, 70.102, 70.104, 70.107, 70.108, 70.109, 80.3, 80.11, 80.17, 80.21, 80.23, 80.29, 80.31, 80.33, 80.109, 80.111, 80. 113(c), 80.115, 80.119, 80.127, 80.133, 80.155, 80.201, 80.205, 80.207, 80.209, 80.213, 80.251, 80.253, 80.257, 80.265, 80.267, 80.271, 86.1, 86.11, 86.15, 86.16, 86.34, 86.55, 86.96, 86.98, 86.99, 86.130, 86.131, 86.132, 340.41(b), 340.43(d), 340.45, 340.53(d), 340.71, 340.73, and 340.131. The titles of proposed sec.sec.10.9, 20.19, 40.5, 40.6, 40.8, 50.39(e), 55.31, 70.109, 80.5, 80.23(b), Chapter 50, Subchapter B and Chapter 86, Subchapter D have also been amended for clarity and to reflect their true content. Several commenters commented generally that the proposed sections limit public participation in permit and enforcement actions more stringently than allowed under federal law and do not meet the minimum requirements for federal program approval, basing this comment in part on a draft report prepared by one of the commenters. The commission disagrees. The commenters very narrowly construe the concept of public participation, and the commission does not agree that the statistics contained in the draft report are accurate. The commission does not agree that such a narrow emphasis on contested case evidentiary hearings at the expense of other methods of public participation is either fair or appropriate. The commission also does not agree that the proposed sections impose new limits on public participation. Although the commission's process will be continually reviewed and improved, the process and the proposed sections are consistent with the "United States Environmental Protection Agency's (EPA) Policy Statement of Public Participation," which contains no requirement for contested case hearings on every permitting matter. Public notice is given in compliance with statutory requirements, and when questions or comments from the public are received, the agency's technical staff responds to them. Agency permit engineers and attorneys spend a considerable amount of time answering questions from the public, meeting with them, educating citizens on both the scientific and legal requirements of permits. As questions are raised, staff reconfirms the review and position it is taking on permits. When there is considerable public interest expressed, the agency often will hold one or more public meetings in the local area to encourage give and take between the public, the applicant, and the staff. This is in addition to public meetings that may be required by statute (e.g., Texas Health and Safety Code, sec.361.0791, on hazardous waste management permits). Most importantly, the commenters overlook the provisions of the proposed sections which in fact dramatically increase the opportunity for public participation--now, every motion for reconsideration of an executive director's action goes directly to the commission, and every hearing request is placed on a commission meeting agenda with the right of the requestor to share information and concerns directly with the three commissioners. Most determinations on hearing requests, prior to September 1, 1995, were handled by the Office of Hearing Examiners with little, if any, involvement by the commissioners. The public now has the ability to submit information and concerns to the commissioners, very often has the ability to personally address the commissioners, and the commissioners have the ability to require the applicant and the executive director's staff to respond to those concerns. The exchange takes place in a posted, public hearing. This satisfies the "exchange of views and open exploration of issues, alternatives, and consequences" standard contained in the EPA Policy Statement. Although the commission believes that the proposed sections represent a dramatic improvement, the commission continues to explore ways to enhance this exchange of views. Several commenters suggested that the commission failed to provide notice of the procedural rule changes to the EPA as required. The commission disagrees. The commenters erroneously interpret 42 United States Code, sec.300h- 1(b)(1)(A)(ii) to require notice prior to final adoption of this rule package. Correctly read, the statute only requires notice of a rule change to the EPA after final adoption of an underground injection well program or changes to the program. Upon adoption of this package, the commission will provide appropriate notice to the EPA. One commenter suggested that proposed sec.1.1 be expanded to address both the purpose and scope of the commission's rules. The commission disagrees with this proposal because the language proposed would state what is already law, that the rights of parties and the commission's powers are established by statute and cannot be enlarged by rule, and that the statutes prevail if the commission's rules are in conflict with them. Several commenters criticized the commission's handling of confidential documents under current rules being revised and adopted as proposed sec.1.5. The commission disagrees with these comments because the commission's management of confidential documents complies with all applicable requirements. Another commenter proposed additional language for this section which would specify the duties of the agency's central records office. The commission disagrees, because the proposed directives concerning internal office procedure can be made without adopting the directives as a rule. The commission notes that it has recently directed its executive director to evaluate the agency's record management practices. This evaluation is already under way, and will include the agency's handling of confidential documents to ensure they are not inadvertently disclosed to the public. A request for proposal has been published for a study on the matter. One commenter suggested that proposed sec.1.11 be amended to make it clear what is included in the phrase "courier-receipted delivery service." The commission believes that the phrase is sufficiently clear, and declines to add any definition beyond that already provided in Texas Rule of Civil Procedure 21a. The commission believes that the modifications to proposed sec.1.11 described as follows may also resolve the commenter's concerns. One commenter noted that proposed sec.1.11 and sec.10.10 appear to be missing subsection (e), which appears in old sec.261.18, from which they are derived. The commission agrees. This deletion was inadvertent, since proposed sec.1.11 and sec.10.10 were intended to include the provisions of old sec.261.18. Proposed sec.10.10 duplicates proposed sec.1.11 and has been deleted, and subsection (e) has been added to proposed sec.1.11. In addition, the commission has further clarified proposed sec.1.11 by more closely tracking Texas Rule of Civil Procedure 21a, which the commission believes covers the same subject matter more completely, and has amended and renumbered subsections accordingly. One commenter suggested that proposed sec.3.2 be revised to incorporate several definitions currently contained in other chapters. The commission agrees in part, and has added definitions of "enforcement action" and "enforcement order" to proposed sec.3.2. Other definitions not moved are used only in single chapters, and the commission believes it more useful to leave those definitions in the chapter to which they apply, rather than move them to a general definitions section. The commission intends, however, to continue to consolidate widely used definitions in Chapter 3 for clarity and consistency. One commenter suggested that the definition of "advisory committee" in proposed sec.5.2 be condensed. The commission agrees, and has amended the proposed section accordingly. This commenter also suggested that this definition be moved from proposed sec.5.2 to proposed sec.3.2. Since this term seems to be used only in proposed Chapter 5, the commission disagrees and has left the definition in proposed sec.5.2. One commenter suggested that proposed sec.10.7 be amended to clarify that the commission will keep a certified agenda of closed meetings held in accordance with the requirements of the Texas Open Meetings Act. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.10.9 and sec.10.10 duplicate proposed sec.1.10 and sec.1.11, and suggested that the proposed sections appear only in proposed Chapter 1. The commission agrees, and has deleted proposed sec.10.10 and amended proposed sec.10.9 to change its title and refer to proposed sec.1.10 and sec.1.11. One commenter suggested that proposed Chapter 40 be amended to allow participation in Alternative Dispute Resolution (ADR) by "interested parties" and to allow mediation to occur before a request for hearing is made. While the commission wholeheartedly supports ADR efforts, it disagrees for two reasons, and declines to make the change. First, participation in ADR in contested cases must necessarily be limited to the parties to the case, or at the hearing request stage, to those filing hearing requests as well. Without this limitation, the commission believes it will be difficult for participants to commit to a process where the number and identity of negotiating parties is subject to change. Second, while the commission is strongly committed to ADR, and encourages its use at all stages of the application process, it believes that it is wiser to continue to encourage informal ADR outside of agency rules prior to entry into the contested case process, and leave its use up to the participants, rather than attempt to promulgate rules governing its use at this time. One commenter suggested that the definition of the term "alternative dispute resolution office" in proposed sec.40.2 be replaced with a definition of the term "alternative dispute resolution director" because the latter is used throughout proposed Chapter 40. The commission agrees, has amended the proposed section accordingly, and has also amended proposed sec.40.5(a)(1) accordingly. One commenter suggested deleting the words "regardless of which ADR method is used" from the definition of "mediator" in proposed sec.40.2, as not adding to the definition. The commission disagrees, because it believes that the term "mediator" is used in some circles as a term of art to refer only to a person engaged in specific dispute resolution procedures, and the term is used in these proposed sections in a more inclusive manner. One commenter suggested using the word "applicant" rather than a longer term in the definition of "participant" in proposed sec.40.2, and adding "named parties" to the definition to make clear that they are included in the definition. The commission agrees, and has amended the proposed section accordingly. One commenter suggested deleting the words "from the pool of mediators" from the first sentence of proposed sec.40.4(a) and adding clarifying language regarding private mediators, to make the proposed section more consistent with the other proposed sections of the chapter. The commission agrees, and has amended the proposed section accordingly. One commenter suggested rewording proposed sec.40.4(c) for brevity and clarity. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.40.6 could be read to exclude the possibility of a matter being referred to ADR after a draft permit is proposed and a protest letter received, but prior to the matter being referred to the State Office of Administrative Hearings (SOAH), as proposed sec.55.25(d)(1) anticipates, and suggested amending the proposed section. The commission agrees with the commenter that this can be the most productive period for ADR, expressly desires to encourage ADR at this point, and has amended the proposed section to make it clear that cases may be referred to ADR at this point and that ADR outside of the commission process may be used at any time. Several commenters commented that proposed sec.50.13 and sec.50.33 allow the commission and its executive director to act on an application without considering any comments, and generally maintain that the proposed sections of procedural rules as a whole preclude public comment. The commenters also claim that the provisions of proposed sec.50.33 which prevent action by the executive director where there is a "protest" and the provision for motions for reconsideration are not an adequate substitute for a public comment process. The commission disagrees, and declines to amend the proposed sections. Proposed sec.50.13 and sec.50.33 allow action without a contested case hearing, which is not equivalent to action without considering comments. The procedures contained in the proposed procedural rules sections are, for the most part, in addition to the commission's public comment process, rather than a substitute for them, as the commenters apparently assume, and the equation of participation in a contested case hearing with public comment is inappropriate. The commission actively encourages public participation, and has gone on record repeatedly to express this and to broaden public participation, but believes that the amendments suggested by the commenters go far beyond the scope of this rulemaking. One commenter suggested that proposed sec.50.39 be amended to allow only an "affected person" to file a motion for reconsideration of an executive director's action on an application, suggesting that the term "other person" is too broad. The commission disagrees, and declines to change the proposed section, because the proposed language gives the commission flexibility to reconsider decisions in situations where the error complained of merits attention regardless of who raises it. Additionally, allowing any person to file a motion for reconsideration allows another avenue for public comment by bringing concerns directly to the attention of the commission. The commission believes, however, that the question of whether a person filing a motion for reconsideration is an affected person will in some cases have a bearing on whether the commission acts on the motion. Several commenters criticized proposed sec.55.21(b) and (d), claiming that because of multiple publications, it may be difficult to tell when the deadline for a hearing request occurs. While much of the timing and many of the contents of notices are specifically required by statute, to the extent that this becomes a problem, the commission plans to deal with it in rulemaking on a new proposed chapter governing public notice, rather than in this rulemaking. Several commenters suggested that proposed sec.55.21(c) constitutes an unlawful delegation and allows the person who designs a notice to decide what will be required in a hearing request. The commenters further assert that the proposed section does not adequately plan for errors in the published notice. The commission disagrees, and declines to change the proposed section. The statutes and other sections of the commission's rules dictate the content of public notices, and this proposed section merely requires hearing requests to comply with those requirements, if any. If the notice is defective, this must be generally cured through republication, thus giving another chance to comply with any requirements. Several commenters criticized proposed sec.55.21(e) for not establishing procedures for requesting extensions of time and suggested the inclusion of a "good cause" or public interest test. The commission disagrees. This section is primarily intended to allow the commission to consider late hearing requests. The commission believes that the proposed section allows more flexibility for the commission and the public than the suggestion does, and declines to change the section. One commenter suggested that proposed sec.55.23(b) be revised to require a group or association to provide an explanation of its hearing request with sworn affidavits, written resolutions, or other satisfactory documentation, rather than to allow other parties to request such an explanation. The commission disagrees. While the proposed sections anticipate that a group or association will submit such information, requiring this as an absolute requirement in advance when the group or association's qualifications are not in dispute is burdensome and unnecessary. However, allowing the listed parties to request that evidence, if they believe it to be an issue, protects the integrity of the hearing process and the rights of the applicant while limiting evidence and testimony to those issues that are actually in dispute. Several commenters suggested that proposed sec.55.23(b) and sec.55.26(f) place unreasonable burdens on the public in replying to responses to hearing requests. There is no proposed sec.55.26 and the latter reference is apparently to proposed sec.55.25(f). The commission disagrees, because these proposed sections merely provide a way for the commission and other parties to determine the basis of a hearing request, which is clearly relevant under Texas Water Code, sec.5.115. While the commission does not agree that the proposed time periods are unreasonable, it has determined that the time for replying to responses to hearing requests in proposed sec.55.25(f) should be lengthened from ten days to 14 days to give requestors more time to prepare, and has amended proposed sec.55.25 accordingly. Several commenters suggested that the commission amend proposed sec.sec.55.25, 55.27, 55.29, and 55.31, to change the way the commission deals with hearing requests and with determinations of whether a person is an "affected person," whether a request is "reasonable," and what constitutes "competent evidence" under Texas Water Code, sec.5.115. The commission agrees that these items may need further attention, but, as announced at the beginning of this phase of rulemaking and stated in the preamble to these proposed rules, has reserved this issue for further rulemaking, once sufficient experience has been accumulated with the existing process to fairly evaluate how well the existing rules are working. This project is already underway at the agency, and the commission expects that it will get into full swing shortly after this rulemaking project is concluded. While some minor adjustments to the current process are included in this round of rulemaking, the commission declines to make the suggested major changes in this round of rulemaking. Several commenters suggested that the proposed sections place an unreasonable burden on who can qualify for a hearing and claimed that the commission has not implemented its authority to provide for public participation in hearings. The commission disagrees. As noted previously, the commission believes that the proposed sections broadly encourage public participation. In addition, the proposed sections are entirely consistent with the law on hearings and standing. Finally, the commission is already committed to reviewing this process in another round of rulemaking. Several commenters suggested that proposed sec.55.25(g) be revised to allow a legislator (for an activity in the legislator's district), a state agency, a federal agency, or a local government (for a facility within the local government's jurisdiction) to send an application directly to SOAH for a contested case hearing. The commission disagrees. Nothing in the statutes grants such blanket rights, and the commission believes that adding this provision would violate both the letter and intent of Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115, as well as other specific statutes dealing with contested case hearings, and therefore declines to make this change. One commenter noted that the provisions of proposed sec.55.27 and sec.55.29 do not appear to address instances where the definition of affected persons in the rule (and in Texas Water Code, sec.5.115) may differ from specific statutory provisions defining "affected person" or "person affected," and suggested that the proposed sections be revised to make it clear that specific statutory provisions control. In the alternative, the commenter suggested that the commission apply both the definition of "affected person" in the proposed sections and any specific statutory definition. The commission agrees with the commenter that Texas Water Code, sec.5.115, the proposed sections, and other specific statutes can and should be read together. Generally, Texas Water Code, sec.5.115 will require a "personal justiciable interest," while other specific statutory provisions delineate those interests, specifying distance limitations or identifying specific persons who can request a hearing. The commission believes that the provisions of proposed sec.55.27 (that a hearing request be granted if it is "pursuant to a right to hearing authorized by law") and proposed sec.55.29 (that a relevant factor in determining whether a person has "a personal justiciable interest related to a legal right, duty, privilege, power, or economic interest affected by the application" is "whether the interest claimed is one protected by the law under which the application will be considered") require Texas Water Code, sec.5.115 and any applicable specific statute to be read together. Thus, the commission declines to modify the proposed sections. Several commenters suggested that proposed sec.55.27(b) and (c) be amended on the grounds that they conflict with statutory provisions such as Texas Water Code, Chapter 27, in which counties are granted hearings regardless of a showing of standing or reasonableness of their hearing requests. The commenters also suggested that the test for a state agency or local government needs to be clarified, alleging, for example, that a county is automatically an affected person for an activity in that county. The commission disagrees. No statute, other than those giving party status to the executive director, public interest counsel, Texas Water Development Board, and Texas Parks and Wildlife Department, provides as a blanket rule that a governmental entity is automatically an affected person for all activities in a geographic area, although some do in specific instances. Texas Water Code, sec.27.018, for instance, provides for a hearing on an injection well permit application if one is requested by a "local government." The statute further distinguishes between the terms "local government" and "affected person"--a distinction that does not appear in Texas Water Code, sec.5.115. While there may be some confusion over the use of the term "affected person" in more than one context, the commission believes that it is clear that a hearing request by a local government under Texas Water Code, sec.27.018 meets the tests of reasonableness and being "pursuant to a right to hearing authorized by law" under proposed sec.55.27(b) and "in the public interest" under proposed sec.55.27(c), and that a governmental entity may be an affected person given the definition of "person" contained in proposed sec.3.2 and its "authority under state law" in proposed sec.55.29(b). The commission further believes that the tests for a state agency or local government are sufficiently clear, and therefore declines to amend the proposed sections. Two commenters suggested that the provisions of proposed sec.55.27(c), which allow the commission to refer an application to SOAH for hearing if the commission determines that a hearing would be "in the public interest" even if there is no valid hearing request, be deleted or that the commission delineate standards it will use in making this determination. Several commenters suggested that the provision is vague in that it does not define "public interest." The commission disagrees with these comments and declines to make the suggested changes, in that it believes that there may be situations where the public interest demands a hearing (one example might be information received after the deadline for hearing requests), and also believes that it would be impossible to define "public interest" at this time in terms more specific than those used by the statutes under which the commission operates. One commenter suggested that proposed sec.55.27(c) be deleted as duplicative of proposed sec.55.27(b)(1). The commission disagrees and declines to make the proposed change. Proposed sec.55.27(b)(1) allows a commissioner, an applicant, or the executive director to request a contested case hearing and thereby refer a case to SOAH, while proposed sec.55.27(c) allows the commission as a whole to vote to send a case to SOAH. The two provisions serve different purposes and the commission believes they should be kept separate. Several commenters suggested that the commission's rules on notice need significant changes, and suggested that proposed sec.55.27(c) be amended to prohibit the final notice on a permit from being issued before technical review is complete and a draft decision is available. The commission does not agree that these proposed sections are the place to deal with notice requirements, notes that no notice has been given to the public or interested parties that notice requirements would be changed in these proposed sections, and points out that it is in the process of preparing for publication a new chapter to consolidate many of its notice rules. However, the commission disagrees with the commenters that the existing rules regarding notice are inadequate or restrict public participation. Proposed sec.55.27(c) does not deal with notice, but rather allows the commission to refer an application to SOAH even if there is no hearing request, and the commission does not agree that amending it to deal with notice would be appropriate or advisable. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear whether an administrative law judge can overrule a commission denial of a hearing request based on standing. The commission has amended proposed sec.55.27(f) to make its position on this issue more clear--that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear what must be done to appeal the denial of a hearing request, do not make it clear when the time period for appeal begins to run, and add new burdens by requiring two appeals. The commission does not agree, and declines to further amend the proposed sections beyond the amendments already described. The proposed sections make it clear that a party whose hearing request is denied must seek to obtain party status and then, if unsuccessful, follow procedures for a motion for rehearing as a prerequisite to appeal once the commission has disposed of the application. Since a person who files a hearing request is asking that a contested case hearing be held, that party obtains the relief sought if any hearing request is granted. That person must then seek to be admitted as a party if the person wishes to participate in the case, and decisions on that issue will be handled as they are now, although the commission anticipates that if the person has a complaint at this point, it will be the denial of party status or a limitation of issues rather than a determination on a hearing request. If all hearing requests are denied or withdrawn, persons whose requests are denied have an opportunity for the review of that decision by filing a motion for rehearing after the commission's decision on the application--that is, at the end of the case, rather than in an interlocutory appeal, as the commenters seem to suggest. The commission believes that it is clear in the proposed sections that the time period for appeals begins to run at this point. While the commenters also suggest that it is unreasonable to force parties to go through a hearing and have the result of that hearing reversed by a court based on an error in denying party status, the commission believes that the risk of this kind of result is minimal, is inherent in every determination of party status in any kind of proceeding, and is outweighed by the burden to the public that would be imposed by delaying every permitting decision until determinations of party status are appealed through the court system. Two commenters noted that proposed sec.55.27(f) allows a person whose hearing request is denied to still seek to be admitted as a party, and suggested that absent some compelling reasons, the commission's determination on the hearing request should preclude the later admission of the person as a party. The commission disagrees, and has amended the proposed section as noted previously to make it clear that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. One commenter suggested that proposed sec.55.27 be amended to allow a motion for reconsideration, rather than a motion for rehearing, of the denial of a hearing request, suggesting that the latter is only appropriate in contested cases under the Administrative Procedure Act, and that no contested case arises if a hearing request is not granted. The commission disagrees. As stated previously, the commission believes that a decision on the validity of a hearing request is an interlocutory decision only on the validity of the request, and does not necessarily dictate the outcome of a later decision on party status, or standing. The commission believes that a motion for rehearing at the conclusion of the proceedings is the most appropriate way to review such a decision. Several commenters remarked that the proposed sections do not allow for an adequate record for judicial review when no contested case hearing is held and do not establish standards for a court to use in its review. The commenters also suggest that the proposed sections do not create an adequate record in rulemaking. The commission disagrees, and declines to make changes based on this comment, because it believes that the record created is sufficient for judicial review of the commission's actions, and the standards of review are already clearly established in the statutes and rules. Similarly, the commission believes that the record created in rulemaking proceedings is more than adequate. Several commenters suggested that proposed sec.55.29 and sec.55.31 be revised to provide that the commission accept as true written statements of a person filing a hearing request for the purposes of the determination on the request or the person requesting a hearing be given an opportunity to present evidence to meet the burden of presenting competent evidence under Texas Water Code, sec.5.115. The commission disagrees and declines to make these changes. The first alternative ignores the clear intent of Texas Water Code, sec.5.115, by allowing a person to meet its standards by simply claiming that the standards are met. Texas Water Code, sec.5.115 provides that the commission "is not required to hold a hearing if the commission determines that the basis of the person's hearing request is unreasonable or is not supported by competent evidence." The second alternative does not recognize that this determination will require different procedures in different cases, and the flexibility which the proposed sections provide--from a decision on the pleadings to oral argument to an evidentiary hearing--allows for procedures to be followed which are appropriate for the cases presented. For example, a permit renewal under Texas Health and Safety Code, sec.382.056 may be an example of a case where requests not alleging increases in emissions or compliance problems can be dealt with on the pleadings alone. Similarly, a person who cannot allege a reasonable basis for a hearing request or who cannot allege that competent evidence exists to support the request, despite having more than one opportunity to do so (the request itself, a reply filed under proposed sec.55. 25(f) to responses that point out the merits or deficiencies of the request, and, in appropriate cases, argument or testimony before the commission) is not going to be able to present such evidence at a hearing, and it may be appropriate to resolve this request without an evidentiary hearing. Several commenters suggested that proposed sec.55.31 is unconstitutionally vague and conflicts with other Texas Natural Resource Conservation Commission rules and the law, specifically proposed sec.55.29 and Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115 and that the provisions of proposed sec.55.31(b)(3) are overly burdensome on public participation. The commission disagrees. The commission believes that the proposed section fully complies with the constitution and with Texas Health and Safety Code, sec.382. 056 and Texas Water Code, sec.5.115. The term "reasonableness" is adequately defined by proposed sec.55.31. Further, proposed sec.55.31 does not conflict with proposed sec.55.29, because they deal with different matters--the first with the determination of whether a person is an "affected person," and the second with whether a hearing request is "reasonable." Several commenters suggested that the proposed rules be revised to "provide that the commission will make determinations and record those determinations so that the public can understand the basis for its government's decision and so that a reviewing court can determine if the actions of the commission should be affirmed or reversed." As noted previously, the commission believes that the proposed sections do exactly that and declines to make changes based on this comment. Several commenters suggested that proposed sec.55.33(a)(3) (and presumably proposed sec.80.5(a)(3)) be revised, claiming that the proposed section requires the Chief Clerk to pay the cost for issuing public notices. The commission disagrees, since the proposed section requires the clerk to issue notice and does not provide for the Clerk to pay the cost of notice, since applicants are clearly responsible for those costs. Proposed sec.55.33 has been withdrawn, however, and only proposed sec.80.5 now governs the Chief Clerk's actions in this context. Several commenters noted that the setting procedures of proposed sec.55.33 largely duplicate those of proposed sec.80.5, and suggested the deletion of one or the other. Some commenters suggested conforming these two proposed sections. The commission agrees that these sections are duplicative and should be conformed, and notes as well that proposed sec.70.109 largely duplicates both of these sections. For clarity, the commission believes that it is most logical to lay out all setting procedures only in proposed Chapter 80, and has deleted proposed sec.55.33 and amended proposed sec.70.109 accordingly. Several commenters suggested that the proposed sections of proposed Chapter 70 limit public participation in enforcement proceedings in a fashion that does not meet the federal requirements for such participation and further state that notice in the Texas Register is insufficient. The commission disagrees, and declines to change the proposed sections. The agency complies with federal authorization rules regarding public participation in enforcement matters, which require the agency to have procedures in place for responding to citizen complaints, publish notice of settlements of civil actions, and give assurance that it will not oppose intervention by any citizen when permissive intervention is authorized by statute, rule, or regulation. In regard to the comment that Texas Register publication is insufficient, while the commission disagrees, it is currently considering alternative citizen participation in administrative actions. If rule changes are necessary after a decision is made on this issue, they will be taken up separate from this rulemaking. One commenter suggested that the definitions of "enforcement order," "enforcement action," "petition," and "respondent" be moved from proposed sec.70.2 to proposed sec.3.2. The commission agrees that the definitions of "enforcement action" and "enforcement order" should be moved to sec.3.2 since they are used in general context in other chapters of the agency's rules; however, the terms "petition" and "respondent," as they are defined in proposed Chapter 70, are specific to enforcement actions by the commission only and should remain in proposed Chapter 70. The commission does not believe that generic definitions of petition and respondent are necessary in proposed Chapter 3 to cover permitting matters because those terms are generally accepted legal terminology and "petition" is already included in the definition of "application." One commenter suggested that proposed sec.70.51 substantially changes old sec.337.71 from relating only to water rights enforcement matters to a more general mandatory enforcement hearing process. The commission disagrees. The language in proposed sec.70.51 was taken verbatim from old sec.337.71, except that the title of the subchapter was changed and references to other rules which had been renumbered were changed. The definitions included in old sec.337. 71 included water quality, water rights, hazardous waste releases, and references to the air statute as well. Although the title of old sec.337.71 indicated "Water Rights Enforcement," its statutory basis is Texas Water Code, sec.5.117, which applies to the agency as a whole, and requires the executive director to bring all instances of substantial noncompliance before the commission. The commenter expressed concern that proposed sec.70.51 would require mandatory hearings for incorrect compliance with record keeping requirements in an air permit. Since this would normally not be a substantial noncompliance under the air rules, this section would not apply in that case. Furthermore, old sec.337.71 and proposed sec.70.51 both exclude air violations, since a separate statutory requirement exists for the air program. The program most affected by this statutory requirement is the water quality program, which has a large amount of self-reporting data submitted each month. The proposed section basically sets forth the practice of the watershed management and enforcement divisions in processing this large volume of documents and describes how they determine what constitutes a substantial noncompliance. One commenter suggested that the concept of "executive director preliminary reports" (EDPR), used in proposed sec.70.101, is not necessary in proposed Chapter 70 and is not mandated by statute. While EDPRs are not required by statute, they are clearly allowed and anticipated by statute (see Texas Water Code, sec.sec.13.4151(c) and (d), 26.136(d) and (e), 27.1015(d) and (e), 34. 011(d) and (e) and Texas Health and Safety Code, sec.sec.341.049(c) and (d), 361. 252(d) and (e), 366.0924(d) and (e), 382.088(d) and (f), and 401.384- 401.385). This rulemaking does not alter the provisions in old Chapter 337 regarding preliminary reports, and sets forth the agency's procedures if preliminary reports are chosen as the form of pleading in a case. The executive director is not required to issue a preliminary report, but is given an option which may be used on a case-by-case basis, which is consistent with the statutory provisions. The commission disagrees with the comment and declines to change the proposed section. The commission has determined that the setting procedures of proposed sec.70. 109 largely duplicate those of proposed sec.80.5, and has amended them to simply refer to proposed sec.80.5. The commission has also amended the title of this section for clarity. One commenter suggested that proposed sec.80.3(a) be amended to make it clear that the judge sitting in a phase of a hearing, not the presiding judge, will resolve evidentiary questions raised during that phase of a hearing. The commission generally agrees, but believes that it may be necessary for a judge sitting in one phase of a hearing to refer some important evidentiary questions to the presiding judge, and has amended the section accordingly. Two commenters suggested that proposed sec.80.3(b)(10) be revised to make it clear that the judge may limit the time of presentation of evidence and witnesses without unfairly prejudicing the rights of parties. The commission agrees, and has amended the rule accordingly. In addition, the commission believes that splitting proposed sec.80.3(a) into two subsections and redesignating proposed sec.80.3(b) as sec.80.3(c) makes the proposed rule more readable, and has amended it accordingly. Two commenters suggested that proposed sec.80.5(b) be amended to expressly state that the commission may limit the issues that shall be considered by SOAH in a contested case. The commission agrees that this ability is implicit in Texas Government Code, sec.2003.047(e), and has amended the proposed section accordingly. These commenters also suggest that the proposed section be amended to provide that the commission "may," rather than "shall," identify issues to be addressed. Since Texas Government Code, sec.2003.047(e) uses "shall," the commission disagrees and declines to make this change. The commission has amended proposed sec.80.5(b) to make it clear that the executive director's petition or EDPR serves as the list of issues to be addressed by SOAH in a contested enforcement case. One commenter suggested that proposed sec.55.33(b) (the same as proposed sec.80.5(b)) be deleted, stating that while the commission may want to restrict or direct the list of issues, the proposed section suggests that a referral is not adequate if it does not. The commission disagrees, since Texas Government Code, sec.2003.047(e) clearly mandates an issues list, and since the proposed section gives the commission the flexibility to submit both broad and narrow ranges of issues. Several commenters suggested that proposed sec.80.13 be amended to allow parties, as well as the executive director, to request consolidation of related proceedings. The commission disagrees and declines to change the proposed section, because this is already allowed by the proposed sections. Proposed sec.80.13 allows the executive director to consolidate matters with the permission of the judge, and allows the judge to consolidate matters, presumably on the judge's own motion or that of any party. One commenter noted that due to changes in Chapter 291 of the commission's rules, proposed sec.80.17 does not accurately reflect the burden of proof in certain water and sewer rate cases. The commenter also noted that enforcement cases covered by subsection (c) of the rule should be expressly excepted from subsection (a). The commission agrees, and has amended the proposed section accordingly. One commenter suggested that proposed sec.80.27 be deleted as duplicative of proposed sec.sec.1.08, 1.10, 1.11, and 80.31. While the proposed sections cover similar matters, the commission disagrees and declines to make the change, because proposed sec.80.27 covers mostly matters of form, while the other proposed sections deal with more procedural matters. The commission has amended proposed sec.80.101 to make it clear that the executive director may either act on a matter remanded to the executive director or set it for consideration at a commission meeting. This is allowed by the proposed section, but the amendment lends clarity. One commenter suggested that proposed sec.80.107 is of sufficient importance that it should be dealt with as a separate subchapter. While the commission agrees that the proposed section is important, it prefers as a matter of form at this time not to create additional subchapters, and declines to make the change. One commenter suggested deleting the phrase "administrative law" from a reference in proposed sec.80.107(a)(3) to result in consistent references to the presiding officer as "judge." The commission agrees, and has amended the proposed section accordingly. One commenter suggested amending proposed sec.80.109(b) to define only statutory parties. The commission disagrees, and believes that the proposed section serves a more useful function by referring to all parties to an application, rather than just statutory parties, and declines to make this change. One commenter suggested deleting proposed sec.80.109(c) as duplicative of proposed sec.80.115. The commission agrees, and has amended the proposed section accordingly, renumbering the subsequent subsections. One commenter suggested deleting proposed sec.80.109(d) (now sec.80.109(c)) as duplicative of proposed sec.80.3(b)(5). The commission disagrees, since the section as amended in response to comments on proposed sec.80.115 now makes it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. One commenter suggested moving proposed sec.80.109(e) ((now sec.80.109(d)) to proposed sec.80.119, arguing that it makes more sense to discuss the effects of continuance in that section. The commission disagrees and declines to make the change. Proposed sec.80.109(e) (now sec.80.109(d)) is intended to make it clear that a person designated as a party retains party status regardless of any postponement of a hearing. Since the rule is limited to party status, the commission feels that it makes more sense to leave it in its present location. Several commenters commented that proposed sec.80.111 prohibits the judge and commission from considering comments. The commission disagrees, and points out that the section does not at all impair the executive director's ability to consider comments. The proposed section prohibits the judge from considering protests or comments submitted by non-parties in a non-evidentiary context (not under oath and without the opportunity to cross-examine) as evidence in contested case proceedings. The commission believes this is required by law, and declines to change the proposed section. The commission notes, however, that the phrase "[i]n proceedings other than enforcement proceedings" was inadvertently published as the end of the second sentence of this section, rather than as the beginning of the third sentence. The commission has amended the section accordingly, so that this limitation applies to questions submitted to the judge, not to the consideration of comments. One commenter noted that proposed sec.80.115 is not clear as to whether each and every party has a right to conduct discovery, present a direct case, cross- examine witnesses, obtain copies of pleadings, and so on, even when parties have been aligned under proposed sec.80.109. The commission agrees that the two provisions could be confusing when read together, and has amended proposed sec.80.109(d) to make it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. The commission anticipates that judges will exercise their best judgment when aligning parties and specifying the purposes for which they are aligned. One commenter suggested that proposed sec.80.117(b) be revised to make it clear that all persons granted party status are covered in the order of presentation. The commission agrees, and has amended proposed sec.80.117 by substituting the words "other parties" for the word "protestant." One commenter suggested deleting the word "SOAH" from proposed sec.80.119(d) to make it clear that the section does not restrict the judge in a contested case proceeding to the use solely of SOAH mediators. The commission agrees, and has amended the proposed subsection accordingly. The subsection has also been combined with proposed sec.80.119(c), to make the section shorter and more clear. One commenter suggested combining proposed sec.80.127(a)(2) and (c) to eliminate duplication. The commission agrees, and has amended the proposed section and renumbered subsections accordingly. One commenter suggested that proposed sec.80.127 be revised to more closely track the provisions of Texas Rule of Civil Procedure 267 and Texas Rule of Evidence 613, which prohibit the exclusion from the hearing room when "the rule" is invoked of an officer or employee of a party that is not a natural person and who is designated as its representative by its attorney and a person whose presence is shown by a party to be essential to the presentation of its case. The commission agrees, and has added subsection (f) to the proposed section so that it will more closely track the practice in the courts. One commenter suggested amending proposed sec.80.133 to allow the judge to set a schedule for the submission of written briefs. The commission agrees, and has amended the proposed section accordingly. Two commenters suggested that proposed sec.80.137 be amended to incorporate by reference Texas Rule of Civil Procedure 166a, because of the substantial body of interpretive case law and legal commentary available. The commission agrees that Rule 166a contains valuable guidance, and has tried to track the language of the rule in the proposed section as far as it considers appropriate given the difference between the administrative and judicial processes and the commission's assumption that the most likely use of the proposed section will be to limit issues, rather than to dispose of applications. The commission has accordingly modified the proposed section to track Rule 166a more closely, and anticipates that practitioners and judges will look to Rule 166a and the decisions construing it for guidance. Two commenters suggested that proposed sec.80.137 be amended to change some language relating to testimonial evidence. Because of the amendments noted previously, the commission believes the issue raised by this language to be resolved and declines to make further changes. One commenter suggested that proposed sec.80.151 be amended to expressly refer to Texas Rule of Civil Procedure 215. The commission disagrees, and declines to change the proposed section, because it believes that the grant of authority in Texas Government Code, sec.2003.047 and the sanctions provisions of proposed sec.80.107 already make sufficient provision for sanctions for discovery abuse. One commenter suggested that proposed Subchapter E of Chapter 80 (the "Freeze Rules") be deleted. While the commission recognizes the commenter's concern, it feels that the "freeze rules" have not yet been given a real test in practice, and is inclined to amend, rather than repeal them. The commission has corrected an incorrect reference in proposed sec.80.205 to refer to sec.80.105, rather than sec.80.60. Several commenters suggested that proposed sec.80.203(a)(1) be amended so that it does not require the executive director to prepare a draft permit if the executive director does not recommend the issuance of a permit. The commission disagrees, and declines to make this change, in part because the "freeze rules" were the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome, and in part because the failure to prepare a draft permit would present an almost insuperable barrier to an applicant should the applicant prevail on the issue of whether or not a permit should be issued. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.207(c) be amended to eliminate the additional time proposed beyond the first discovery period for filing a list of issues. The commission disagrees, and declines to make this change. An earlier version of this rule required protestants to have their issues list finished simultaneously with the end of the first discovery period, which the commission believes compresses the work that must be done. The commenter suggested that in the event the additional time remained, additional time should be added to proposed sec.80.207(e) as well. The commission disagrees and declines to make this change, since additional time is already granted by timing the applicant's response from the time the first list of issues is submitted, rather than the close of the first discovery period. Several commenters commented that proposed sec.80.207(d) allows an applicant to disrupt the work required of protestants to comply with subsection proposed sec.80.207(c), and suggested the deletion of the second sentence in subsection (d). The commission disagrees, and declines to make this change. The commenters apparently missed the time extension given in proposed sec.80.207(c), which now allows for completion of the issues list "within 20 days after the end" of the time period originally contained in old sec.265.104, from which the proposed section is derived. The result of the proposed sections is to give the protestant an additional 20 days to complete the issues list, while allowing the applicant to go forward with discovery. The result, rather than an additional burden on the protestant, is an easing of requirements. One commenter suggested that proposed sec.80.207(h) be amended to allow a limited amendment of the application in some circumstances. While the commission agrees that this commenter's point has some merit, the current arrangement was the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.209(c)(3) be amended to require the judge to distribute a prehearing order within four days from the prehearing conference. While the commission recognizes the commenter's concern and the limited (14-day) time period between the prehearing conference and the hearing, it prefers at this time to leave the timing of the prehearing order to the judge, trusting that prehearing orders will be distributed as soon as possible considering the compressed time frame. Two commenters suggested that proposed sec.80.213 be revised to make it clear that paragraphs (1)(A) and (B) are not mutually exclusive and that the judge may direct a party to both voluntarily reduce its listed witnesses and provide a summary of the expected testimony of each witness. One commenter also suggested that the language of the rule be made more clear that the judge may prohibit testimony of witnesses. The commission agrees, and has amended the section accordingly. Several commenters suggested that proposed sec.80.259 be revised to eliminate a provision that would allow a judge to file an amended proposal for decision without serving it on the parties. This provision was included in a redline/strikeout version of the proposed rules distributed by agency staff during the rulemaking process, but was dropped from the proposed rule before publication, and thus no revision to the proposed rule is necessary. The staff regrets any inconvenience caused by failing to notify interested persons of the change before publication. The commission has amended proposed sec.80.263 to make it clear that the general counsel may set time limits for oral presentations before the commission. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.sec.80.265, 80.267, and 80.271 to remove the word "final" where it refers to commission decisions or orders, because the use of the word in these proposed sections may be unintentionally confusing when compared with the use of the word in Government Code, sec.sec.2001.141-2001.144, dealing with when decisions become final. One commenter suggested that the provision of proposed sec.80.267(b) that the commission will render a decision within 60 days after the date the hearing is finally closed does not give the commission enough time to render its decisions. The commenter suggested lengthening the time period to 90 days. The commission agrees that cases heard by a judge may take more than 60 days, but notes that the 60-day period is mandated by Texas Government Code, sec.2001. 143 unless extended. The commission believes, however, that proposed sec.80. 267(b) gives the judge enough flexibility to extend the time, and therefore declines to make the suggested revision. The commission has amended proposed sec.80.277 to more clearly reflect the commission's position and longstanding agency practice that the executive director or an authorized representative may forward an enforcement order to the attorney general for enforcement. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.86.18(c)(1)(C) to change the time period for filing applications for rehearing to 30 days to be consistent with Water Code, sec.11.316. One commenter suggested that the definition of "monitoring well" in proposed sec.340.2 be amended to expressly exclude monitoring wells used in conjunction with the production of coal and lignite, as is apparently intended by the general exclusion for wells used in conjunction with the production of "other minerals." The commission agrees, and has amended the section accordingly. One commenter noted that proposed sec.340.73 appears to differ from the requirements under discussion at the agency for sec.338.31 and sec.338.32 as to the persons to whom copies of well logs are to be submitted. The commission agrees, and has amended proposed sec.340.73 and sec.340.75 to add local underground water conservation districts and make these sections consistent. Subchapter A. General 30 TAC sec.86.1 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.86.1. Special Procedures to Prevail. This chapter supplements Chapter 80 of this title (relating to Contested Case Hearings) by providing special procedures to be followed for particular types of hearings. Whenever there is a conflict between this chapter and Chapter 80 of this title, this chapter prevails. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606763 Kevin McCalla 27> Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter B. Water Rights Adjudication 30 TAC sec.sec.86.11-86.18 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.86.11. General. (a) Applicability. This subchapter applies to the commission's duties, responsibilities, and activities under the Water Rights Adjudication Act of 1967, Texas Water Code, sec.sec.11.301, et seq. (b) Motions. A motion may be filed with the commission as provided by sec.80.56 of this title (relating to Motions), with copies served only on those parties participating in the evidentiary hearing; except that, if there are other parties whose interests are likely to be substantially affected by the relief sought in the motion, copies shall be served on each such party or his representative. (c) Mailing list. The commission shall maintain an official mailing list for each stream or segment being adjudicated, which shall include the following: (1) the persons within the stream or segment being adjudicated who filed claims in accordance with Texas Water Code, sec.11.307; (2) all other persons who filed claims under Texas Water Code, sec.11.303, or who have permits or certified filings within the segment being adjudicated; (3) all other diverters of state water within the segment being adjudicated who can be reasonably ascertained from the records of the commission or from the executive director's investigation; (4) all attorneys or other interested persons who request to be put on the mailing list, either in writing or on the record during one of the hearings in the adjudication; and (5) all contesting parties. (d) Definition. As used in this subchapter, the term "mailing list" means the commission's official mailing list for the stream or segment being adjudicated. sec.86.15. Preliminary Determination. (a) Preparation of judge's recommendations. A judge presiding at the individual evidentiary hearings or one who has read the record shall prepare written recommendations, including proposed findings of fact and conclusions of law, in regard to each individual claim and shall submit his recommendations and the record of the hearing to the commission for its consideration. (b) Preparation of preliminary determination. After reviewing any judge recommendations and the record of the hearings, the commission shall adopt a preliminary determination of all claims of water rights in the segment being adjudicated as required by Texas Water Code, sec.11.309. (c) Distribution of preliminary determination. One copy of the preliminary determination shall be furnished and sent without charge by first-class mail to each person on the mailing list. Additional copies of the preliminary determination shall be made available for public inspection at convenient locations throughout the river basin as designated by the commission. Copies shall also be made available for other persons at a reasonable price based upon the cost of production. (d) Public inspection of record. The record of the hearings shall be open to public inspection as required by the Public Information Act, and Texas Water Code, sec.11.310. (e) Notice of preliminary determination. The commission shall publish notice of the preliminary determination. (1) Promptly after the preliminary determination is adopted, notice shall be published once a week for two consecutive weeks in one or more newspapers having general circulation in the river basin in which the segment that is the subject of the adjudication is located. (2) The commission shall also send the notice by first-class mail to each claimant of water rights within the river basin in which the stream or segment is located, to the extent that the claimants can be reasonably ascertained from the records of the commission, and to other persons on the mailing list. (3) Each notice shall state the following: (A) the place where the preliminary determination and record of the hearings will be open for public inspection; (B) the locations throughout the river basin where copies of the preliminary determination will be available for public inspection; (C) the method of ordering copies of the preliminary determination and the charge for copies; and (D) the date by which contests of the preliminary determination must be filed. sec.86.16. Contests to Preliminary Determination. (a) Filing deadline. The commission shall set a date for filing contests to the preliminary determination, which shall be not less than 90 days from the date of the notice of the preliminary determination. (b) Filing of contest. Any water right claimant affected by the preliminary determination, including any claimant to water rights within the river basin, but outside the segment under adjudication, who disputes the preliminary determination may, within the time for filing contests prescribed by the commission in the notice, including any extensions of time, file a written contest with the commission. (c) Copy of contest to claimant. If the contest is directed against the preliminary determination of the water rights of other claimants, a copy shall be sent by the contestant to each of these claimants or his representative by certified mail, and proof of service shall be filed with the commission. (d) Extension of time for filing contests. The commission may accept contests filed after the deadline but before the issuance of the notice of hearings on the contests. (e) Contents of contests. Each contest shall do the following: (1) state the name of the claimant, nature of the claim, and the page number in the preliminary determination to which the contest is directed; (2) describe the specific parts of the preliminary determination to which objection is made, pointing out the specific findings of fact, conclusions of law, or other matters objected to, or specifying the findings of fact, conclusions of law, or other matters alleged to have been erroneously omitted from the preliminary determination; and (3) describe the facts relied upon to support the grounds of the contest and be verified by an affidavit of the contestant or his representative. (f) Amendments to contests. Amendments to contests may be authorized at any time, provided that the commission finds that the amendment will not result in undue surprise to any party and will not significantly change the grounds of the contest as described in the commission's notice of the contest hearings. (g) Notice of hearing on contests. After the time for filing contests has expired, the commission shall prepare a notice setting forth the parts of the preliminary determination to which each contest is directed and the date, time, and place of the hearing on each contest. The notice shall be sent by certified mail to each contestant and by first-class mail to each claimant of water rights within the river basin within which the segment is located and to all other persons on the mailing list. The notice shall set a specific date, time, and place for each contestant to appear. sec.86.18. Final Determination and Appeal. (a) Proposed final determination. When a majority of the commission has not heard the contest or read the record, the judge who presided at the contest hearing or one who has read the record shall prepare a proposal for final determination and shall send it by first-class mail to all persons on the commission's mailing list. The proposed final determination shall contain a statement of the reasons therefor and a statement of each finding of fact and conclusion of law stated separately necessary to support the proposed final determination. Any party adversely affected may file exceptions and present briefs to the commission concerning the proposal for final determination within the time limit stated in the notice of the proposal for final determination. The parties may waive compliance with this rule by written stipulation filed with the commission. (b) Final determination. The adjudication hearings shall be closed at the conclusion of the last contest hearing. The commission will make a final determination of the claims to water rights in the adjudication within 60 days after the closing of the adjudication hearings, provided that where the case was not heard by the commission, the judge may set a reasonable time for the issuance of a final determination and shall announce such extension at the closing of the adjudication hearings. The commission shall send a copy of the final determination, and any modification thereof, by first-class mail to each person of record on the mailing list as required by Texas Water Code, sec.11. 315. (c) Notice of final determination. The commission shall send a notice of the final determination by first-class mail to each claimant of water rights within the river basin in which the segment is located, to the extent that the claimants can be reasonably ascertained from the records of the commission, and to each other person on the commission's mailing list. (1) Each notice shall state the following: (A) the place that the final determination and record of hearings will be open for public inspection; (B) the method of ordering copies of the final determination and the cost of copies; and (C) the date by which applications for rehearing must be filed, which shall be 30 days from the date of issuance of the final determination. (2) The commission shall provide in the final determination and notice thereof the effective date of the determination in order to provide a sufficient period of time within which the determination and notice can be printed and mailed. (d) Application for rehearing of final determination. An application for rehearing is the same as a motion for rehearing under the APA, and is a prerequisite to filing an exception to the final determination under Texas Water Code, sec.sec.11.318, et seq. (1) If an application for rehearing is granted, the commission shall issue notice setting forth the substance of the application and setting the time and place of the hearing. Notice shall be sent in the same manner provided for in contest hearings. (2) If the final determination is modified after a rehearing, the commission shall send a copy of the modified final determination by first-class mail to each person on the mailing list. However, if the modifications are such that they are likely to substantially affect the rights of other water right holders within the basin but outside the watershed or segment being adjudicated, then a summary of the modifications shall also be sent to all other water rights holders in the basin. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606764 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter C. Water Rate Hearings 30 TAC sec.sec.86.31-86.36 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.86.34. Notice of Preliminary Hearing. At least 20 days before the date set for the hearing, the chief clerk shall transmit by certified mail a certified copy of the hearing order to the water supplier and water customer. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606765 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter D. Appeals of City Actions Relating to Water Pollution Control and Abatement Outside the Corporate Limits of a City 30 TAC sec.sec.86.51-86.59 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.86.55. Contents of Petition for Review. The petition shall contain: (1) the name of the party seeking commission action, with the original copy of the pleading signed by the petitioner or the petitioner's authorized representative; (2) the business phone number and address of the city whose action is being appealed and the city's authorized representative, if any; (3) a clear and concise statement that the petition for review is an appeal of a specific action of the municipality in question, as well as a concise description and date of the action; (4) a copy of the applicable ruling, order, decision, ordinance, program, resolution, or other act of the city, if any; (5) a list of the known persons and areas which might be affected if the petition is granted; (6) a concise statement of the facts relied upon by the pleader; (7) a prayer stating the type of relief, action, or order desired by the pleader; and (8) any other matter required by statute. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606766 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter E. Appeals of Rules of the Edwards Underground Water District 30 TAC sec.sec.86.91-86.101 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.86.96. Prerequisites to Appeal. The following are prerequisites to appeal under this subchapter. (1) Filing a petition. An appeal under this subchapter requires the filing of a petition for review with the chief clerk of the commission as provided under sec.86.97 of this title (relating to Contents of Petition for Appeal). (2) Service of pleadings. A copy of the petition and all other pleadings shall be served by the petitioner by certified mail or personal delivery on the Edwards Underground Water District, the executive director of the commission, and the public interest counsel of the commission. A certificate of service shall be furnished to the chief clerk with the original pleading. (3) Filing fee. Each petition shall be accompanied by a filing fee of $100, unless the petition is submitted by a state agency or other entity exempt from such fee requirements. (4) Hearing. A time and place for hearing on the matter in dispute shall be set and notice of the hearing shall be issued by the chief clerk as required by law. The petitioner is responsible for the cost of required notice. sec.86.98. Answer. Not later than the 20th day after the date on which the Edwards Underground Water District receives a copy of the petition, the district may submit to the chief clerk an answer in defense of the rule from which the appeal is taken. sec.86.99. Review by Commission. If the commission determines a rule is unreasonable or invalid, it shall, at its discretion, either declare that the rule is null and void and direct the board of directors of the district to adopt a substitute rule or reform the rule so that it is reasonable and valid. The commission on its own motion, or at the request of any party to an appeal, may refer the appeal to SOAH for hearing. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606767 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter F. Variance Hearings 30 TAC sec.sec.86.130-86.132 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.86.130. Variance Hearings Pursuant to the Texas Clean Air Act. Upon the filing of a proper petition, a date for a hearing on the petition shall be set not be more than 90 days after the date the petition is filed. Notice of the hearing shall be given as required by the TCAA and the APA. A petition for the variance shall be considered to be in proper form if it identifies the person seeking the variance; identifies the particular rule or provisions of the TCAA from which a variance is sought; identifies the source of air contaminants which are the subject of the petition, including information on the nature and the amount of emissions from the source, if available, and the location of the source; and includes a short and plain statement of the grounds upon which the relief is sought. Forms to assist in the filing of a petition are available upon request, but are not mandatory. sec.86.131. Time for Filing Petition for Variance. If a compliance hearing is called to examine the status of a particular source with regard to the TCAA or the rules and regulations of the commission, the source owner or operator must file with the commission a petition for variance before the commencement of the hearing to be entitled to have the commission consider the right to a variance with regard to the particular provisions of the TCAA or rules or regulations which are the subject of the hearing. Any commission order as a result of such hearing shall be deemed to dispose of the issue of the right to a variance. Any petition for variance filed after the hearing shall be returned to the applicant without action by the staff or the commission, unless the petition demonstrates that circumstances have so changed as to make it just and equitable to reopen the matter. sec.86.132. Effect of Institution of Civil Suit on Petition for Variance. If the commission or the executive director, as authorized by the commission, requests institution of a civil suit pursuant to the TCAA, for violation of the TCAA or any commission rule, regulation, variance, or order before the commission takes action on a petition for variance submitted with regard to the violations to be alleged in the suit, the petition for variance shall be returned to the applicant without further action. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606768 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Chapter 116. Control of Air Pollution by Permits for New Construction or Modification The commission adopts amendments to sec.116.12 and sec.116.211, concerning nonattainment review definitions and the Standard Exemption (SE) List, with changes to the proposed text as published in the January 12, 1996, issue of the Texas Register (21 TexReg 300). The amendments to sec.116.12 will make the requirements for determining whether a proposed change will trigger nonattainment review consistent with recent changes to sec.116.150. Standard exempted changes at existing major sources will be required to provide netting when the project increases of nitrogen oxides (NO point=9.03p set=9.03p>are 40 tons per year (tpy) or greater. If the contemporaneous net is greater than the major modification level listed in sec.116.12, the source will be required to register the exemption and hold offsets in abeyance. New exempted sources of NOx the major source threshold in Table I of sec.116.12 will also be required to register. A footnote to Table I has been added to clarify that the Texas nonattainment area designations are specified in Title 40, Code of Federal Regulations, sec.81.344. The commission decided to retain the original language of sec.116.211(a) with the exception of the date of the SE List. The original language of sec.116. 211(d) will also be retained with the exception of the change from "TACB" to "commission." The proposed amendments to sec.116.211 also change the date of the SE List to identify the date of revisions to the list. The amendments to the SE List, which is contained in subsection (f), address four problems: Problem 1 : there are no existing standard exemptions that exempt animal shelters and zoos or small custom paint and ink blending facilities from permitting requirements. Two new exemptions (SE 72 and SE 125) have been proposed to exempt these types of facilities from permitting requirements. Without these exemptions, the owner/operator would be required to obtain a new construction permit at considerable time and expense; Problem 2: three existing standard exemptions are not clear as to intent or applicability. One standard exemption (SE 116) is being reworded to clarify that it applies to antique auto restoration rather than a standard autobody shop, which is authorized under another exemption; Problem 3: four existing exemptions are more restrictive than necessary or should be expanded to cover new technology. For example, the printing exemption (SE 13) has been updated to cover party balloon printers and duplicating centers. The exemption for thermoset resins (fiberglass) (SE 113) has been relaxed to allow more emissions of acetone which has recently been delisted as a volatile organic compound (VOC). Proposed changes will allow additional facilities to claim an exemption (rather than the more difficult permit route) and reduce unnecessary restrictions on small emission sources; Problem 4: two existing exemptions are being changed to provide more flexibility as requested by industry or to remove unrealistic sampling requirements. For example, the exemption for changes at permitted semiconductor manufacturing facilities (SE 115) has been reworked to allow chemical substitutions and minor chemical increases necessary to meet technical changes in the wafer processing. The stack sampling requirement for ethylene oxide (EO) sterilizing chambers (SE 89) has been deleted after discussion with the regions and after reviewing the results of past sampling reports. The amendments to the SE List include changes to the following standard exemptions: SE 13, SE 73, SE 74, SE 75, SE 89, SE 90, SE 113, SE 115, and SE 116. The amendments also add new SE 72 and SE 125. The commission originally proposed, but has decided not to adopt, amendments to SEs 71, 93, and 117, concerning concrete batch plants; and new SE 126, concerning electric solvent recovery equipment. The amendments to the SE List are summarized as follows: SE 13, concerning printing operations-updates the exemption to include many insignificant printing operations such as copy centers, T-shirt printers, and party balloon makers. The exemption requires registration for new printing operations that produce more than ten tpy of VOC emissions; SE 72, concerning animal racing facilities, domestic animal shelters, and zoos-exempts all such facilities from being subject to an air permit technical review; SE 73, concerning rock crushers- clarifies that the exemption is applicable to all rock crushers with a maximum rated capacity of 200 tons per hour (tph) or less to provide consistency with current agency interpretation of the exemption; SE 74, concerning grain handling, storage, and drying facilities-shortens the allowable distance of an exempt facility from 1/2 mile to 1/4 mile from any recreational area, residence, or other structure owned by someone other than the grain facility; SE 75, concerning coatings-clarifies the difference between outdoor or nonenclosed coating operations, defines a coating source as a booth or enclosed operation, allows for trace amounts of metal compounds in coatings, and reduces the overall complexity and technical details of the existing exemption; SE 89, concerning EO sterilizing chambers (used by hospitals)-removes the stack sampling requirement for facilities that use between 100-1,000 pounds of EO per year and eliminates requirements for facilities using less than four pounds per year; SE 90, concerning pathological waste and carcass incinerators and crematories-adds definitions to clarify eligible facilities, removes the on-site generated waste restriction for non-commercial operations, and adds alternative design requirements for incinerators at animal feeding operations; SE 113, concerning thermoset resins-increases acetone usage, allows for small amounts of resins to be used outdoors, and improves clarity and readability; SE 115, concerning semiconductor manufacturing operations-allows for a larger number of compounds to choose from when substituting or introducing new air contaminants by referencing the Effects Screening Levels (ESL) list or use of an ESL approved by the Toxicology and Risk Assessment (TARA) section of the commission; SE 116, concerning automobile restoration facilities-clarifies that this exemption only applies to the restoration of classic or antique vehicles. The enclosed building must be at least 50 feet from the property line. Waste fluids must be disposed of properly and usage records must be kept for two years; SE 125, concerning paint and ink manufacturing-adds a new SE to authorize the construction and operation of small paint and ink manufacturing operations which will emit insignificant levels of air contaminants (25 tpy solvent emissions, one tpy particulates, opacity maximum 5.0%). The commission has prepared a Takings Impact Assessment for these rules pursuant to Texas Government Code, sec.2007.043. The following is a summary of that Assessment. The specific purpose of the rules is to give regulatory relief to persons from the permit filing requirements of Texas Clean Air Act, sec.382.0518. The rules will substantially advance this specific purpose by clarifying nine existing exemptions and creating two new ones. Promulgation and enforcement of these rules will not affect private real property which is the subject of the rules because it is a voluntary option to a property owner which is less burdensome than obtaining a permit. A public hearing on the proposed rules was held on February 15, 1996, in Austin. Oral and/or written testimony on the rules was provided by 11 commenters: Texas Agricultural Cooperative Council, Austin Marble Company, Browning-Ferris Industries, City Public Service of San Antonio, the City of Dallas, Eastman Chemical Company, the United States Environmental Protection Agency (EPA), Texas Grain and Feed Association, the law firm of Henry, Lowerre, Johnson, Hess & Frederick (Henry), Marble Masters of Texas, Olympian Marble Company, and the City of Wichita Falls. General comments are as follows. COMMENT: Browning-Ferris Industries wrote in support of the proposed rule changes. COMMISSION RESPONSE: The commission acknowledges the support. COMMENT: EPA wrote that "On the basis of our evaluation, we have no items of concern." COMMISSION RESPONSE: The commission acknowledges the comment. COMMENT: The City of Wichita Falls requested that a standard exemption be granted for the burning of waste oil in space heaters. COMMISSION RESPONSE: This comment is outside the scope of the current rulemaking proceeding. However, the commission plans to propose such a rule in its next round of standard exemption rulemaking. COMMENT: City Public Service of San Antonio stated that it would have been extremely helpful to state somewhere in the preamble that the full text of the standard exemptions was found in a different section of the Texas Register . COMMISSION RESPONSE: The policy of the Texas Register is to publish graphics, such as the SE List, in a separate section of the publication. Section 116.211(a) comments are as follows. COMMENT: In referring to the 25 tpy of "any other air contaminant" contained in sec.116.211(a)(1), the City of Dallas commented that "surely the TNRCC does not intend standard exemptions at 25 tons per year of toxic materials defined in the 1990 CAA." COMMISSION RESPONSE: In addition to the limits contained in sec.116.211(a)(1) , any person who chooses to use a standard exemption for the authorization of a new or modified facility must meet all of the conditions contained in sec.116. 211(a)-(e). This would include proposed sec.116.211(a)(7), which requires compliance with Federal Clean Air Act (FCAA), sec.111 and sec.112 . FCAA, sec.112 contains the toxic materials list and subsequent requirements referred to by this commenter. In addition, sec.116.211(c) requires that the emissions from the facility comply with all rules and regulations of the commission. This section will cover rules developed by the commission pursuant to any future delegation of the FCAA, sec.112 requirements. The commission has made no changes in response to this comment. COMMENT: City Public Service of San Antonio and Eastman Chemical stated that the proposed language in sec.116.211(a)(4) would place additional limits on the use of standard exemptions at facilities located in attainment areas. In addition, City Public Service stated that netting is not currently required in attainment areas. COMMISSION RESPONSE: The commission agrees with the commenters regarding the language contained in sec.116.211(a)(4). As mentioned in the proposal preamble, the commission intended to clarify existing requirements with the addition of this paragraph. Accordingly, the commission has modified the language in sec.116.211(a)(4) and similar language in sec.116.211(a)(2). In addition, the proposed sec.116.211(b) has been eliminated as redundant and subsequent paragraphs have been re-lettered. The commission disagrees with City Public Service of San Antonio's comment regarding netting in attainment areas. Netting is required where the increases from a project when considered by themselves exceed the significant net emissions levels contained in Title 40 Code of Federal Regulations 52.21(b)(23) of the Prevention of Significant Deterioration rules. The commission has made no changes in response to this portion of City Public Service of San Antonio's comment. Section 116.211(d) (re-lettered to subsection (c) due to the deletion of subsection (b)) comments are as follows. COMMENT: Henry, Lowerre, Johnson, Hess & Frederick (Henry) asserted that the commission, by amending sec.116.211(d), is attempting to exempt standard exemption determinations from a requirement of a review for compliance with other applicable commission rules, and that an individual review of compliance with commission rules is required to determine whether a facility meets a standard exemption. COMMISSION RESPONSE: The commission has decided to retain the original language of sec.116.211(c) (relettered from sec.116.211(d)) with the exception of changing from "TACB" to "commission." COMMENT: Henry also asserted that facilities that qualify for certain standard exemptions would violate other commission rules, that a facility that does not meet other commission rules cannot be an insignificant source, that the commission has no basis to determine that all facilities that qualify for a standard exemption also meet all other applicable commission rules, and, therefore, that the commission does not have authority to adopt the proposed amendment to sec.116.211(d). COMMISSION RESPONSE: See response to previous comment. SE 71, SE 93, and SE 117 comments are as follows. COMMENT: Comments were received from Henry on SE 71. COMMISSION RESPONSE: The commission has decided not to adopt the proposed revisions to SE 71, SE 93, and SE 117 at this time. SE 73 comments are as follows. COMMENT: Henry stated that rock crushers are significant sources of air contaminants and should not be covered by a standard exemption. COMMISSION RESPONSE: The commission agrees that large rock crushers can be significant sources of air contaminants and, therefore, limited the applicability of the current SE 73 to rock crushers with a throughput of 200 tpy or less. COMMENT: Henry also stated that it is inappropriate to expand the scope of SE 73 before it is reexamined by the commission. COMMISSION RESPONSE: As stated in the proposal preamble, the amendments to SE 73 do not expand the scope of this exemption; in fact, this amendment will limit the applicability of SE 73 to crushers with a maximum rated capacity of 200 tph or less. Thus, larger crushers, even if actually limited to a 200 tph capacity, will no longer qualify for exemption. It has been the experience of the regional investigators that exempted facilities operated as required by the conditions of the exemption will not cause, or contribute, to a condition of air pollution. The scope of the exemption is also not being expanded by removing the word "portable." Rock crusher units that are portable are usually smaller so that they can be moved more easily. Permanent rock crushers tend to be much larger than the 200 tph limit in the exemption to be able to economically justify constructing them. This amendment will not preclude further examination by the commission and subsequent amendments if warranted. However, it would be inappropriate to delay the restriction provided by this amendment to address a potential problem with determining compliance with the current SE 73. SE 74 comments are as follows. COMMENT: Two comments were received in response to proposed changes to SE 74 (relating to grain handling and drying). Both the Texas Grain and Feed Association and the Texas Agricultural Cooperative Council were in support of reducing the required buffer from 1/2 to 1/4 mile, and both opposed the reduced maximum storage capacity of one million bushels from the current 1.5 million bushels. COMMISSION RESPONSE: The commission agrees that the maximum one-time capacity should remain at 1.5 million bushels. The 1.5 million bushel limit is still adequate for safeguarding the state's air resources. SE 75 comments are as follows. COMMENT: The City of Dallas expressed concern that the minimum distance and site approval requirements for outdoor coating operations were being removed. COMMISSION RESPONSE: The proposed SE 75 has been reorganized to improve readability and eliminate grammatical errors. There have been no substantive changes to the exemption. The minimum distance and site approval requirements for outdoor operations have not been changed or removed. The requirements in existing paragraphs (k) and (l) were combined into the proposed paragraph (k). Proposed paragraph (k) is now paragraph (h) under this reorganized version. SE 89 comments are as follows. COMMENT: The City of Dallas requested that either "annual" or "per year" be added to clarify the 1,000 pounds of EO usage. COMMISSION RESPONSE: The commission agrees. In the opening sentence of SE 89, the term "1,000 pounds of EO usage" did not have a time limit attached to it. "Per year" has been added to this sentence after "...1,000 pounds or less of EO (per year)...." All other references to EO usages in SE 89 have the time limits attached to them. SE 90 comments are as follows. COMMENT: The City of Dallas stated that it prefers that the exemption require automatic operation of burners, or adequate record keeping. Dallas would also prefer "gauze dressings, cardboard, etc." to be treated as pathological waste because they are "vectors for pathogens." COMMISSION RESPONSE: "Automatic" operation is being deleted because of uncertainty as to how automatic the operation had to be (from keyed startup with system lockouts to manual startup of burners that would then operate without further operator assistance). By deleting "automatic," the commission is not exempting the facility from meeting the minimum temperature requirements at all times while burning waste. Also, 30 TAC Chapter 111 does require that certain sizes and types of incinerators operate and maintain continuous temperature monitors, and maintain appropriate records. There is pathogen contaminated material that has been, and continues to be, specifically excluded from this exemption. Broadening the materials allowed to be burned would, in effect, allow the incineration of medical waste. The category of medical waste incineration needs to be reviewed on a case-by-case basis. The commission has made no changes in response to these comments. SE 113 comments are as follows. COMMENT: Austin Marble Company, Marble Masters of Texas, Inc., and Olympian Marble Company each requested that the time restriction on operating hours for resin fabrication be clarified as a restriction on resin spraying operations. COMMISSION RESPONSE: The commission agrees with the commenters. The emissions from resin spraying are considerably higher than those from other fabrication methods such as hand lay-up or continuous lamination. Subsection (a)(3) of this exemption has been modified to make this clarification. In addition, the commission added the word "usage" after "Records of resin and acetone" in subsection (a)(2) for clarification. COMMENT: The City of Dallas requested that the requirement for notification of the regional office and local programs be retained and that site approval be required. It also stated that there should be a different stack height requirement for buildings greater than 18 feet in height to address building downwash concerns. COMMISSION RESPONSE: This exemption requires the filing of Form PI-7, which requires that copies be sent to the regional office and any local program. Therefore, it is not necessary to restate the requirement to make these notifications in the exemption. Site approval is not required by the current exemption, and the commission has received no evidence to indicate that lack of a site approval requirement has contributed to any problems. The commission shares the City of Dallas' concern regarding building downwash. This concern is being addressed by requiring that stacks be no shorter than six feet above the peak of the manufacturing building. The current wording of the exemption would allow stacks to be lower than the building peak. The commission has made no changes in response to these comments. SE 115 comments are as follows. COMMENT: The City of Dallas requested clarification as to whether the exemption applies sitewide, and if so, requested that "sitewide" be inserted in the first sentence. COMMISSION RESPONSE: The exemption does apply to the entire site; however, the addition of the word "sitewide" will not clarify this exemption. No changes will be made in response to this comment. COMMENT: The City of Dallas also suggested additional wording be added which restricts emission allowables to SE 118 emission rates, distance, and ESL requirements. COMMISSION RESPONSE: The proposed SE 115 does not relate distance to impacts. Rather, emission allowables are based on ESLs. The New Source Review Division (NSR) and TARA have determined that emissions 0.04 lb/hr or less are too small for their impacts to be accurately estimated or monitored (see Modeling and Effects Review Applicability Guidance Document for Non-Criteria Pollutants dated January 25, 1994). The commission has made no changes in response to this comment. COMMENT: The City of Dallas also requested that the existing requirement to file Form PI-7 prior to start of construction be retained. COMMISSION RESPONSE: Since the current version requires registration, most claimants have misinterpreted this requirement to mean they must wait for authorization from NSR before performing their changes. Although the claimants do not need to wait for verification of their claim, many request a letter. Because of the rapid changes in their industry, they request an extremely quick turnaround time on these letters. This exemption requires a great deal of effort by a permit engineer to verify the claim in a short period of time. Since these facilities already have a permit, the regional offices and local programs are already aware of their presence at the location. Therefore, the addition of a notification requirement for changes authorized through the use of this exemption is not justified. SE 125 comments are as follows. COMMENT: The City of Dallas suggested additional emission rate limits of five tpy for any single toxic compound defined in the FCAA Amendments of 1990, and ten tpy total for these compounds. The city asked what happened to missing condition (f). COMMISSION RESPONSE: The 1990 Amendments to the FCAA established levels for hazardous air pollutants above which a Federal Operating Permit is required. In addition, the amendments require that Maximum Achievable Control Technology standards be established under FCAA, sec.112, for source categories emitting these pollutants. Since sec.116.211(a)(7) requires compliance with FCAA, sec.112, it serves no purpose to place additional limits in this exemption. The commission has made no changes in response to these comments. There is no condition (f). This was a typographical error and has been corrected. SE 126 comments are as follows. COMMENT: City Public Service of San Antonio objected to this exemption because of the requirement to calculate fugitive emissions. The commenter also stated that it is not normal to derive emission limits from ESLs. COMMISSION RESPONSE: The commission has decided not to adopt the proposed SE 126 at this time. Subchapter A. Definitions 30 TAC sec.116.12 The amendment is adopted under the Texas Health and Safety Code, 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. sec.116.12. Nonattainment Review Definitions. Unless specifically defined in the Texas Clean Air Act (TCAA) or in the rules of the commission, the terms used by the commission have the meanings commonly ascribed to them in the field of air pollution control. The terms in this section are applicable to permit review for major source construction and major source modification in nonattainment areas. In addition to the terms which are defined by the TCAA, and in sec.101.1 of this title (relating to General Rules), the following words and terms, when used in the undesignated head regarding Nonattainment Review, shall have the following meanings, unless the context clearly indicates otherwise. Major modification -Any physical change in, or change in the method of operation of a facility/stationary source that causes a significant net emissions increase for any air contaminant for which an NAAQS has been issued. At a facility/stationary source that is not major prior to the increase, the increase by itself must equal or exceed that specified in the MAJOR SOURCE column of Table I of this section. At an existing major facility/stationary source, the increase must equal or exceed that specified in the MAJOR MODIFICATION column of Table I. A physical change or change in the method of operation shall not include: (A)-(F) (No change.) (G) any change in ownership at a stationary source. Figure: 30 TAC sec.116.12 Major modification definition (G) This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 17, 1996. TRD-9606896 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 7, 1996 Proposal publication date: January 12, 1996 For further information, please call: (512) 239-1966 Subchapter C. Permit Exemptions 30 TAC sec.116.211 The amendment is adopted under the Texas Health and Safety Code, 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. sec.116.211. Standard Exemption List. (a) Pursuant to the Texas Clean Air Act (TCAA), sec.382.057, the facilities or types of facilities listed in the Standard Exemption List, dated May 15, 1996, are exempt from the permit requirements of the TCAA, sec.382.0518, because such facilities will not make a significant contribution of air contaminants to the atmosphere. A facility shall meet the following conditions to be exempt from permit requirements. (1) Total actual emissions authorized under standard exemption from the proposed facility shall not exceed 250 tons per year (tpy) of carbon monoxide (CO) or nitrogen oxides (NO point=9.54p set=9.54p>or 25 tpy of volatile organic compounds (VOC) or sulfur oxides (SO2 point=9.03p set=9.03p>or inhalable [sub]le particulate matter (PM10), or 25 tpy of any other air contaminant except carbon dioxide, water, nitren, methane, ethane, hydrogen, and oxygen. (2) Except as noted in paragraph (3) of this subsection, any facility which constitutes a new major source, or any modification which constitutes a major modification under the new source review requirements of the Federal Clean Air Act (FCAA), Part D (Nonattainment) as amended by the FCAA Amendments of 1990, and regulations promulgated thereunder, shall be subject to the requirements of Subchapter B of this chapter (relating to New Source Review Permits) rather than this subchapter. (3) For sources of NO baseadj=-2.91p point=4.52p >x in the Houston/Galveston ozone nonattainment area (Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery, and Waller Counties) or the Beaumont/Port Arthur ozone nonattainment area (Hardin, Jefferson, and Orange Counties) the major source/major modification level listed in Table 1 of sec.116.12 of this title can be exceeded with the following conditions. (A) New sources of NO baseadj=-2.91p point=4.52p >x the major source threshold or major modifications exceeding the major modification level for NOx Table 1 shall register by submitting a PI-8. (B) The registration shall be submitted prior to commencement of construction, but not later than December 31, 1997. (C) No other applicable limits contained in this section shall be exceeded. (4) Any facility which constitutes a new major source, or any modification which constitutes a major modification under the new source review requirements of the FCAA, Part C (Prevention of Significant Deterioration) as amended by the FCAA Amendments of 1990, and regulations promulgated thereunder, shall be subject to the requirements of Subchapter B of this chapter rather than this subchapter. (5) Total actual emissions authorized under standard exemption from the property where the proposed facility is to be located shall not exceed 250 tpy of CO, or NO baseadj=-2.91p point=4.52p >x, 25 tpy of VOC, or SO2 point=9.03p set=9.03p>or PM10, or 25 tpy of any other air contaminant except carbon dioxide, water, nitrogen, methane, ethane, hydrogen, and oxygen, unless at least one facility at such property has been subject to public notification and comment as required in Subchapter B or Subchapter D of this chapter (relating to New Source Review Permits or Permit Renewals) or the pertinent Chapter 116 procedures that were in effect at the time. (6) Construction or modification of the facility shall be commenced prior to the effective date of a revision of the Standard Exemption List under which the construction or modification would no longer be exempt. (7) The proposed facility shall comply with the applicable provisions of the FCAA, sec.111 (regarding Federal New Source Performance Standards) and sec.112 (regarding Hazardous Air Pollutants). (8) There are no permits under the same commission account number that contain a condition or conditions precluding use of the standard exemption or standard exemptions. (b) No person shall circumvent by artificial limitations the requirements of sec.116.110 of this title (relating to Applicability). (c) The emissions from the facility shall comply with all rules and regulations of the commission and with the intent of the TCAA, including protection of health and property of the public and all emissions control equipment shall be maintained in good condition and operated properly during operation of the facility. (d) Copies of the current Standard Exemption List are available from the commission. (e) Installations exempted by the commission may be required by local air pollution control agencies to receive a permit or permits from that agency, or register with that agency. Any such requirements must be in accordance with the TCAA, sec.382. 113, and any other applicable law. Figure: 30 TAC sec.116.211(e) This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 17, 1996. TRD-9606897 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 7, 1996 Proposal publication date: January 12, 1996 For further information, please call: (512) 239-1966 Chapter 261. General Provisions Subchapter A. General Procedure 30 TAC sec.sec.261.1-261.19 The commission adopts the repeal of sec.sec.261.1-261.19, concerning procedural rules. The repeals are adopted without changes to the proposed text as published in the February 20, 1996, issue of the Texas Register (21 TexReg 1349) and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. No comments were received regarding adoption of the repeals. The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401.011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606769 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 239-1966 Chapter 263. Final Approval by Executive Director, Evaluation of Request for Contested Case Hearing The commission adopts the repeal of sec.sec.263.1-263.12 and 263.21-263.28, concerning procedural rules. The repeals are adopted without changes to the proposed text as published in the March 19, 1996, issue of the Texas Register (21 TexReg 2122) and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. No comments were received regarding adoption of the repeals. Subchapter A. Final Approval by Executive Director 30 TAC sec.sec.263.1-263.12 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401.011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606792 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter B. Evaluation of Request for Contested Case Hearing, Referral of Application to State Office of Administrative Hearings 30 TAC sec.sec.263.21-263.28 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606793 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Chapter 264. Alternative Dispute Resolution 30 TAC sec.sec.264.1-264.10 The commission adopts the repeal of sec.sec.264.1-264.10, concerning procedural rules. The repeals are adopted without changes to the proposed text as published in the March 19, 1996, issue of the Texas Register (21 TexReg 2161) and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. No comments were received regarding adoption of the repeals. The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401.011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606794 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Chapter 265. Procedures Before Public Hearings The commission adopts the repeal of sec.sec.265.1, 265.2, 265.21-265.30, 265.41-265.45, 265.47, 265.48, 265.60-265.73, 265.81-265.88, 265.101-265.104, 265.106-265.113, 265.121-265.134, 265.141-265.145, and 265.151-265.166, concerning procedural rules. The repeals are adopted without changes to the proposed text as published in the March 19, 1996, issue of the Texas Register (21 TexReg 2163) and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. No comments were received regarding adoption of the repeals. Subchapter A. Definitions 30 TAC sec.265.1, sec.265.2 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606795 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter B. General Rules 30 TAC sec.sec.265.21-265.30 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606796 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter C. General Procedures 30 TACsec.sec.265.41-265.45, 256.47, 265.48 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606797 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter D. Hearing Procedures 30 TAC sec.sec.265.60-265.73 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606798 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter E. Discovery and Sanctions 30 TAC sec.sec.265.81-265.88 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606799 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter F. Special Procedures for Freezing the Process Procedures 30 TAC sec.sec.265.101-265.104, 265.106-265.113 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606800 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Discovery 30 TAC sec.sec.265.121-265.134 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606801 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Sanctions 30 TAC sec.sec.265.141-265.145 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606804 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter G. Post-hearing Procedures 30 TAC sec.sec.265.151-265.166 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606805 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Chapter 275. Special Provisions The commission adopts the repeal of sec.sec.275.1, 275.11-275.18, 275. 31- 275.36, 275.51-275.59, 275.71-275.80, 275.91-275.101, and 275.130-275.132, concerning procedural rules. The repeals are adopted without changes to the proposed text as published in the March 19, 1996, issue of the Texas Register (21 TexReg 2122) and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. No comments were received regarding adoption of the repeals. General 30 TAC sec.275.1 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606806 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Water Rights Adjudication 30 TAC sec.sec.275.11-275.18 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606807 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Water Rate Hearings Special Procedures 30 TAC sec.sec.275.31-275.36 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606808 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Appeals of City Actions Relating to Water Pollution Control and Abatement Outside the Corporate Limits of the City 30 TAC sec.sec.275.51-275.59 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606809 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Rulemaking Public Hearings of the Commission 30 TAC sec.sec.275.71-275.80 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606810 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Appeals of Rules of the Edwards Underground Water District 30 TAC sec.sec.275.91-275.101 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606811 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Variance Hearings 30 TAC sec.sec.275.130-275.132 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606812 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Chapter 305. Consolidated Permits Subchapter E. Actions, Notice, and Hearing 30 TAC sec.sec.305.91-305.93, 305.98, 305.99 The commission adopts the repeal of sec.sec.305.91-305.93, 305.98, and 305. 99, concerning procedural rules. The repeals are adopted without changes to the proposed text as published in the March 19, 1996, issue of the Texas Register (21 TexReg 2122) and will not be republished. Sections 305.94, 305. 95-305.97, and 305.100-305.107 have been withdrawn by the commission at this time. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. No comments were received regarding adoption of the repeals. The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401.011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606813 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter M. Waste Treatment Inspection Fee Program 30 TAC sec.305.503 The Texas Natural Resource Conservation Commission (commission or agency) adopts the amendment to sec.305.503, relating to Fee Assessment, without changes to the proposed text as published in the November 24, 1995 issue of the Texas Register (20 TexReg 9830). The amendment increases the annual inspection fee for wastewater treatment facilities to a level authorized by House Bill (HB) 2015, Acts of the Seventy- fourth Legislature, 1995, and only as necessary to acquire and implement federal delegation of the National Pollutant Discharge Elimination System (NPDES) in accordance with sec.402 of the Federal Clean Water Act. In accordance with HB 2015, this fee increase shall be effective only upon NPDES delegation. Also in accordance with HB 2015, treatment works owned by a local government shall be exempt from the fee increase until August 31, 1999. In addition to the exemption of publicly-owned domestic wastewater treatment facilities provided by HB 2015, exempt facilities shall also include privately- owned domestic wastewater facilities and confined/concentrated animal feeding operations. These latter exemptions are based upon those factors provided under Texas Water Code, sec.26.0291(b) including flow volume, toxic pollutant potential, level of traditional pollutant, and heat load. Upon expiration of these exemptions in 1999, the fee rate schedule will be re-examined. The Federal Clean Water Act provides for an NPDES wastewater discharge permitting program, currently administered in Texas by the United States Environmental Protection Agency (EPA) Region 6 Office. Texas also has a wastewater permitting program authorized by Chapter 26 of the Texas Water Code and administered by the commission. Section 402 of the Clean Water Act allows delegation of the NPDES program to a state if the state has the ability and authority to administer a permitting program substantially equivalent to that of the federal program. The regulated community urged the commission to seek NPDES delegation to eliminate the duplication and resulting additional cost and burden of dual permitting requirements. Despite the increase in inspection fees that will follow delegation of NPDES authority, industrial permit holders will realize a savings due to the elimination of duplicate requirements. In 1995, the Texas Legislature enacted HB 2015 to address statutory changes needed to obtain NPDES delegation. In addition to addressing any remaining, potential legal issues necessary for delegation, the bill also provided that sec.26.0291 of the Texas Water Code be amended to authorize the commission to assess an annual wastewater facility inspection fee not to exceed $25,000. The bill further provided that the commission may not adopt any rule designed to increase fees for facilities owned by local governments before August 31, 1999. Therefore, any increase in funding required to implement the NPDES program will have to be borne primarily by industrial wastewater permit holders at least until 1999. Currently, state wastewater permitting, inspections, and related modeling and water quality monitoring cost approximately $19.56 million annually. Existing wastewater facility inspection fees generate approximately $7.2 million annually. General revenue, federal grant monies, and $5 million from the Clean Rivers Program, Texas Water Code, sec.26.0135(h), fund the remaining amount. The additional cost of delegation is estimated to be approximately $2. 8 million. To provide for this additional cost, the Texas Legislature appropriated to the commission an amount not to exceed $2,861,102 for fiscal year 1996 and $2,517,102 for fiscal year 1997 out of additional revenues generated by fee increases authorized by HB 2015. The additional $2.8 million annual cost and the fee increase exemption provided to all but the industrial facilities will require taking the existing formula as it is applied to industrial facilities and multiplying that result by a factor based upon the ratio of the difference between the old and new fee caps to determine the new fees for industrial facilities. The current fee rate schedule is based in part upon the assignment of "points" as a measure of pollutant potential, flow volume, contamination, and pollutant parameters (e.g. , ammonia, suspended solids, oxygen demand, etc.). The maximum fee amount is also determined by an administratively set maximum number of points per facility and the statutory maximum fee amount. To generate an additional $2.5 to $2.8 million in additional annual revenue will require an average increase in fees of $3,125 per facility for the approximately 800 industrial permittees in the state, almost doubling the current average fee. This revenue will be used to fund up to 44 full time positions. The amendment to sec.305.503 increases the maximum annual fee from $11,000 to $25,000, and establishes a new rate schedule for fees not exempted from increase by HB 2015 by providing that the fee shall be determined by multiplying the previous fee by a factor not to exceed 2.3, which is the ratio of the difference between the new maximum fee amount of $25,000 and the old maximum fee of $11,000. Finally, the amendment states that the minimum fee shall not add less than $150 to the previous fee amount. Three commenters submitted testimony during the public comment period which closed on December 31, 1995. Texas Utilities Services, Inc. (TU) supported the amendment. The City of Amarillo (Amarillo) opposed the amendment. Sterling Chemicals submitted comments on sec.305.533, which was not at issue in the proposal and cannot be addressed in this analysis. TU supports the commission's efforts to obtain delegation from EPA for the NPDES program and the reopening of sec.305.503 in September 1999. TU emphasizes that the fee increase should only be effective upon delegation of NPDES authority to the commission. In accordance with House Bill 2015, the fee increase is effective only upon NPDES delegation. Amarillo questioned the $2.8 million dollars required for the operation of the NPDES program under a state permit. Amarillo also stated that the agency is already performing all the functions required under NPDES. The agency is not now performing all the functions necessary to acquire delegation. The $2.8 million of additional funding covers the data entry and monitoring reports, the increased number of inspections, the conversion of NPDES permits to TPDES permits, and the assumption of the federal sludge program. To meet federal requirements for EPA delegation will require an additional 44 full- time employees at a cost of about $2.7 million. Amarillo commented that an increase of $2.8 million represents a 14 percent increase in the $19.56 million currently required for the program. They question the necessity for an increase in the maximum fee from $15000 to $25000, a 67 percent increase. They state that the current maximum fee is adequate to cover a 14 percent increase in cost. There would be no increase in fees for the majority of the industrial dischargers if only the maximum fee was increased. The current maximum fee is $11,000. The new $25,000 fee cap is necessary to generate the additional revenues because the fee increase is limited to industrial operators only and the current fee rate schedule remains in effect. Of the 3900 wastewater facilities currently permitted in Texas, approximately 21 percent are classified as industrial wastewater permits. Based on the current fee rate schedule, the average fee paid by industrial permit holders is approximately $3,350 because a large majority (82 percent) of industrial dischargers are permitted to discharge less than one million gallons of effluent per day. Over half are authorized to discharge less than 10,000 gallons per day. The 67 percent increase in the maximum fee would have no effect on these industrial dischargers. The current rate schedule controls the costs paid by any one permittee in two ways: (1) the fee cannot exceed the statutory maximum, and (2) "points" as a measure of pollutant potential, flow volume, contamination, and pollutant parameters are assigned only up to a certain value. The result is that the proposed $25,000 fee cap and funding required to support NPDES will require contributions from the industrial permit holders that are not representative of the size or pollutant potential of the facilities. While the average increase per industrial operator will be about $3,125, almost double the current average fee, there will be a net savings due to the elimination of existing duplicate EPA and commission permit requirements. Amarillo commented that HB 2015 authorizes fee increases only as necessary to acquire and implement federal delegation of the NPDES and that the fee increase is counter to this requirement in two ways. In the first instance, the increase in program operation costs as a result of NPDES delegation does not justify the percentage of increase in the maximum fee. Secondly, the current fee schedule is based, in part, on a "point" system which assesses inspection fees according to such factors as pollution potential, flow volume, and pollutant content. Amarillo questions how this relates to the administration of the NPDES and states that fees should be increased as a disincentive to generate water pollution, not because the state is granted NPDES authority. The percentage increase in the maximum fee does not directly correspond to the increase in fees as a result of NPDES delegation. The 67 percent increase in the maximum fee alone would have no effect on the majority of the industrial dischargers. As previously stated, the current rate schedule is limited by the maximum fee and point system. For example, if the point system results in a fee of $15,000, the maximum that commission could assess remains $11,000. By increasing the fee cap, the point system does act as a disincentive to generate water pollution. Even after the proposed fee increase, the majority of the industrial operators will remain well below the maximum fee level at an average of $6,500. The amendment is adopted under the Texas Water Code, sec.26.0291, relating to waste treatment inspection fees, and the Texas Water Code, sec.5.103, which provides the commission the authority to adopt any rules necessary to carry out its powers and duties under the Texas Water Code and other state law. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 10, 1996. TRD-9606900 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 9, 1996 Proposal publication date: November 24, 1995 For further information, please call: (512) 239-4640 Subchapter O. Additional Conditions and Procedures for Wastewater Discharge Permits and Sewage Sludge Permits TAC sec.305.533 The Texas Natural Resource Conservation Commission (TNRCC or commission) adopts an amendment to sec.305.533, relating to adoption of the U.S. Environmental Protection Agency (EPA) issued permits and pretreatment programs, without changes to the proposed text as published in the November 24, 1995 issue of the Texas Register (21 TexReg 9830). The purpose of amendment of sec.305.533 relates to the commission's assumption of the National Pollutant Discharge Elimination System (NPDES) program. Existing sec.305.533 became effective in 1990 at a time when the commission previously was anticipating NPDES program authorization from EPA in 1991. The amendment updates the regulation in a manner that will more accurately reflect how the commission will adopt NPDES permits after it assumes the NPDES program from the EPA. Section 305.533 is also amended to include the correct fiscal year of 1996 and is removing special reference to classified major NPDES permits. There are no other substantial changes to this section. One commenter submitted testimony during the public comment period which closed on December 31, 1995. Sterling Chemicals commented that when a difference exists between a federal and a state permit, the more recent permit, as opposed to the most stringent, should apply as it is implied in the delegation of permitting authority to a state that the permit requirements will be at least as strict as the federal requirements. Upon delegation, there will continue to be NPDES and state permits. The 40 CFR 123.25 (a) does not become effective until a "new" TPDES permit is issued upon renewal/amendment of either the state or NPDES permit. Then, 40 CFR 123. 25 provisions will apply in preparation of TPDES permit. There is currently no mechanism to disregard the state permit for the federal permit or vice versa. A new TPDES permit must be issued. The amendment is adopted under the Texas Water Code (Vernon 1992), sec.5.103, which provides the TNRCC with the authority to adopt any rules necessary to carry out the powers and duties under the provisions of the Texas Water Code and other laws of this state. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 10, 1996. TRD-9606892 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 9, 1996 Proposal publication date: November 24, 1995 For further information, please call: (512) 239-4640 Chapter 309. Effluent Limitations TAC sec.309.30 The Texas Natural Resource Conservation Commission (TNRCC or commission) adopts the repeal of sec.309.30, relating to criteria for classification of solid waste disposal facilities and practices. The purpose of the repeal of sec.309.30 is to eliminate a rule which is no longer needed due to the promulgation of new criteria relating to sewage sludge and water treatment sludge. As written, sec.309.30 would have adopted certain federal regulations on the date of program authorization of the National Pollutant Discharge Elimination System (NPDES). The commission adopts this repeal to prevent the commission from adopting 40 Code of Federal Regulations (CFR), Part 257, as specified in sec.309.30. There is currently no need for the commission to adopt 40 CFR Part 257 because it has been superseded by new 30 TAC Chapter 312, effective on October 13, 1995. The commission is currently seeking program delegation of NPDES and has a need to repeal sec.309.30, which would cause confusion with the commission's Chapter 312 if left in place. The repeal is adopted under the Texas Water Code (Vernon 1992), sec.5.103, which provides the commission with the authority to adopt any rules necessary to carry out the powers and duties under the provisions of the Texas Water Code and other laws of this state. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 10, 1996. TRD-9606893 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 9, 1996 Proposal publication date: November 24, 1995 For further information, please call: (512) 239-4640 Chapter 337. Enforcement Rules The commission adopts the repeal of sec.sec.337.1-337.6, 337.8-337.10, 337. 21-337.48, 337.50-337.58, and 337.71, concerning procedural rules. The repeals are adopted without changes to the proposed text as published in the February 20, 1996, issue of the Texas Register (21 TexReg 1369) and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. No comments were received regarding adoption of the repeals. Subchapter A. Enforcement Generally 30 TAC sec.sec.337.1-337.6, 337.8-337.10 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606815 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 239-1966 Subchapter B. Contested Enforcement Case Hearings 30 TAC sec.sec.337.21-337.48, 337.50-337.58 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606816 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 239-1966 Subchapter C. Special Enforcement Proceedings 30 TAC sec.337.71 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606817 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 239-1966 Chapter 339. Pump Installers The commission adopts the repeal of sec.sec.339.1-339.7, 339.10-339.16, 339. 20-339.24, and 339.30-339.44, concerning procedural rules. The repeals are adopted without changes to the proposed text as published in the March 19, 1996, issue of the Texas Register (21 TexReg 2122) and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. No comments were received regarding adoption of the repeals. Subchapter A. General Provisions 30 TAC sec.sec.339.1-339.7 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606818 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter B. Licensing 30 TAC sec.sec.339.10-339.16 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606821 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter C. Standards of Professional Conduct 30 TAC sec.sec.339.20-339.24 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606822 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter D. Enforcement 30 TAC sec.sec.339.30-339.44 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606826 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Chapter 340. Licensing Requirements and Complaint Procedures for Water Well Drillers and Pump Installers The commission adopts the repeal of sec.sec.340.1, 340.3-340.7, 340.10, 340. 15, 340.43, 340.49, 340.82-340.87, 340.91, 340.93, 340.95, 340.97, 340.99, 340. 133, 340.135, and 340.137; new sec.sec.340.1, 340.3, 340.43, 340.49, 340.82- 340. 86, 340.88-340.93, 340.101, 340.103, 340.105, 340.107, 340.109, 340.133, 340. 135, and 340.137; and amendments to sec.sec.340.2, 340.31, 340.33, 340.35, 340. 37, 340.39, 340.41, 340.45, 340.51, 340.53, 340.71, 340.73, 340.75, 340.77, 340.81, 340.111, and 340.131, concerning procedural rules. Sections 340.2, 340. 41, 340.43, 340.45, 340.53, 340.71, 340.73, 340.75, and 340.131 are adopted with changes to the proposed text as published in the March 19, 1996, issue of the Texas Register (21 TexReg 2180). Sections 340.1, 340.3, 340.31, 340. 33, 340.35, 340.37, 340.39, 340.49, 340.51, 340.77, 340.81-340.86, 340.88-340. 93, 340.101, 340.103, 340.105, 340.107, 340.109, 340.111, 340.133, 340.135, and 340.137 and the repeals are adopted without changes and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. Comments were received from Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts. Sentry Environmental; Brown McCarroll & Oaks Hartline; Kelly, Hart & Hallman; Bickerstaff, Heath, Smiley, Pollan, Kever & MacDaniel; the Irion County Water Conservation District; the Lower Colorado River Authority; Texas Utilities Services, Inc.; and Baker & Botts generally supported the adoption of the proposed sections with some changes. Henry, Lowerre, Johnson, Hess & Frederick, on their own behalf and that of the Sierra Club and the Environmental Defense Fund, while apparently not opposing the adoption of the proposed sections as a whole, generally expressed concerns related to public participation and issues related to delegated federal programs. A number of commenters suggested minor editorial, typographical, and grammatical changes to clarify or shorten the proposed sections. The commission generally agrees with these suggestions, and has amended the proposed sections accordingly. These changes have been made to proposed sec.sec.1.1, 1.5, 1.7, 1.10, 1.11(a), 3.2, 5.3, 5.8, 5.10, 5.11, 5.12, 5.14, 10. 1, 10.2, 10.3, 10.6, 10.8, 20.17, 40.5, 40.6, 40.8, 40.9, 50.13, 50.17, 50.31, 55.21, 55.23, 55.25, 55.27, 55.29, 55.31, 70.2, 70.3, 70.4, 70.5, 70.6, 70.7, 70.8, 70.9(b), 70.10, 70.11, 70.101, 70.102, 70.104, 70.107, 70.108, 70.109, 80.3, 80.11, 80.17, 80.21, 80.23, 80.29, 80.31, 80.33, 80.109, 80.111, 80. 113(c), 80.115, 80.119, 80.127, 80.133, 80.155, 80.201, 80.205, 80.207, 80.209, 80.213, 80.251, 80.253, 80.257, 80.265, 80.267, 80.271, 86.1, 86.11, 86.15, 86.16, 86.34, 86.55, 86.96, 86.98, 86.99, 86.130, 86.131, 86.132, 340.41(b), 340.43(d), 340.45, 340.53(d), 340.71, 340.73, and 340.131. The titles of proposed sec.sec.10.9, 20.19, 40.5, 40.6, 40.8, 50.39(e), 55.31, 70.109, 80.5, 80.23(b), Chapter 50, Subchapter B and Chapter 86, Subchapter D have also been amended for clarity and to reflect their true content. Several commenters commented generally that the proposed sections limit public participation in permit and enforcement actions more stringently than allowed under federal law and do not meet the minimum requirements for federal program approval, basing this comment in part on a draft report prepared by one of the commenters. The commission disagrees. The commenters very narrowly construe the concept of public participation, and the commission does not agree that the statistics contained in the draft report are accurate. The commission does not agree that such a narrow emphasis on contested case evidentiary hearings at the expense of other methods of public participation is either fair or appropriate. The commission also does not agree that the proposed sections impose new limits on public participation. Although the commission's process will be continually reviewed and improved, the process and the proposed sections are consistent with the "United States Environmental Protection Agency's (EPA) Policy Statement of Public Participation," which contains no requirement for contested case hearings on every permitting matter. Public notice is given in compliance with statutory requirements, and when questions or comments from the public are received, the agency's technical staff responds to them. Agency permit engineers and attorneys spend a considerable amount of time answering questions from the public, meeting with them, educating citizens on both the scientific and legal requirements of permits. As questions are raised, staff reconfirms the review and position it is taking on permits. When there is considerable public interest expressed, the agency often will hold one or more public meetings in the local area to encourage give and take between the public, the applicant, and the staff. This is in addition to public meetings that may be required by statute (e.g., Texas Health and Safety Code, sec.361.0791, on hazardous waste management permits). Most importantly, the commenters overlook the provisions of the proposed sections which in fact dramatically increase the opportunity for public participation--now, every motion for reconsideration of an executive director's action goes directly to the commission, and every hearing request is placed on a commission meeting agenda with the right of the requestor to share information and concerns directly with the three commissioners. Most determinations on hearing requests, prior to September 1, 1995, were handled by the Office of Hearing Examiners with little, if any, involvement by the commissioners. The public now has the ability to submit information and concerns to the commissioners, very often has the ability to personally address the commissioners, and the commissioners have the ability to require the applicant and the executive director's staff to respond to those concerns. The exchange takes place in a posted, public hearing. This satisfies the "exchange of views and open exploration of issues, alternatives, and consequences" standard contained in the EPA Policy Statement. Although the commission believes that the proposed sections represent a dramatic improvement, the commission continues to explore ways to enhance this exchange of views. Several commenters suggested that the commission failed to provide notice of the procedural rule changes to the EPA as required. The commission disagrees. The commenters erroneously interpret 42 United States Code, sec.300h- 1(b)(1)(A)(ii) to require notice prior to final adoption of this rule package. Correctly read, the statute only requires notice of a rule change to the EPA after final adoption of an underground injection well program or changes to the program. Upon adoption of this package, the commission will provide appropriate notice to the EPA. One commenter suggested that proposed sec.1.1 be expanded to address both the purpose and scope of the commission's rules. The commission disagrees with this proposal because the language proposed would state what is already law, that the rights of parties and the commission's powers are established by statute and cannot be enlarged by rule, and that the statutes prevail if the commission's rules are in conflict with them. Several commenters criticized the commission's handling of confidential documents under current rules being revised and adopted as proposed sec.1.5. The commission disagrees with these comments because the commission's management of confidential documents complies with all applicable requirements. Another commenter proposed additional language for this section which would specify the duties of the agency's central records office. The commission disagrees, because the proposed directives concerning internal office procedure can be made without adopting the directives as a rule. The commission notes that it has recently directed its executive director to evaluate the agency's record management practices. This evaluation is already under way, and will include the agency's handling of confidential documents to ensure they are not inadvertently disclosed to the public. A request for proposal has been published for a study on the matter. One commenter suggested that proposed sec.1.11 be amended to make it clear what is included in the phrase "courier-receipted delivery service." The commission believes that the phrase is sufficiently clear, and declines to add any definition beyond that already provided in Texas Rule of Civil Procedure 21a. The commission believes that the modifications to proposed sec.1.11 described as follows may also resolve the commenter's concerns. One commenter noted that proposed sec.1.11 and sec.10.10 appear to be missing subsection (e), which appears in old sec.261.18, from which they are derived. The commission agrees. This deletion was inadvertent, since proposed sec.1.11 and sec.10.10 were intended to include the provisions of old sec.261.18. Proposed sec.10.10 duplicates proposed sec.1.11 and has been deleted, and subsection (e) has been added to proposed sec.1.11. In addition, the commission has further clarified proposed sec.1.11 by more closely tracking Texas Rule of Civil Procedure 21a, which the commission believes covers the same subject matter more completely, and has amended and renumbered subsections accordingly. One commenter suggested that proposed sec.3.2 be revised to incorporate several definitions currently contained in other chapters. The commission agrees in part, and has added definitions of "enforcement action" and "enforcement order" to proposed sec.3.2. Other definitions not moved are used only in single chapters, and the commission believes it more useful to leave those definitions in the chapter to which they apply, rather than move them to a general definitions section. The commission intends, however, to continue to consolidate widely used definitions in Chapter 3 for clarity and consistency. One commenter suggested that the definition of "advisory committee" in proposed sec.5.2 be condensed. The commission agrees, and has amended the proposed section accordingly. This commenter also suggested that this definition be moved from proposed sec.5.2 to proposed sec.3.2. Since this term seems to be used only in proposed Chapter 5, the commission disagrees and has left the definition in proposed sec.5.2. One commenter suggested that proposed sec.10.7 be amended to clarify that the commission will keep a certified agenda of closed meetings held in accordance with the requirements of the Texas Open Meetings Act. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.10.9 and sec.10.10 duplicate proposed sec.1.10 and sec.1.11, and suggested that the proposed sections appear only in proposed Chapter 1. The commission agrees, and has deleted proposed sec.10.10 and amended proposed sec.10.9 to change its title and refer to proposed sec.1.10 and sec.1.11. One commenter suggested that proposed Chapter 40 be amended to allow participation in Alternative Dispute Resolution (ADR) by "interested parties" and to allow mediation to occur before a request for hearing is made. While the commission wholeheartedly supports ADR efforts, it disagrees for two reasons, and declines to make the change. First, participation in ADR in contested cases must necessarily be limited to the parties to the case, or at the hearing request stage, to those filing hearing requests as well. Without this limitation, the commission believes it will be difficult for participants to commit to a process where the number and identity of negotiating parties is subject to change. Second, while the commission is strongly committed to ADR, and encourages its use at all stages of the application process, it believes that it is wiser to continue to encourage informal ADR outside of agency rules prior to entry into the contested case process, and leave its use up to the participants, rather than attempt to promulgate rules governing its use at this time. One commenter suggested that the definition of the term "alternative dispute resolution office" in proposed sec.40.2 be replaced with a definition of the term "alternative dispute resolution director" because the latter is used throughout proposed Chapter 40. The commission agrees, has amended the proposed section accordingly, and has also amended proposed sec.40.5(a)(1) accordingly. One commenter suggested deleting the words "regardless of which ADR method is used" from the definition of "mediator" in proposed sec.40.2, as not adding to the definition. The commission disagrees, because it believes that the term "mediator" is used in some circles as a term of art to refer only to a person engaged in specific dispute resolution procedures, and the term is used in these proposed sections in a more inclusive manner. One commenter suggested using the word "applicant" rather than a longer term in the definition of "participant" in proposed sec.40.2, and adding "named parties" to the definition to make clear that they are included in the definition. The commission agrees, and has amended the proposed section accordingly. One commenter suggested deleting the words "from the pool of mediators" from the first sentence of proposed sec.40.4(a) and adding clarifying language regarding private mediators, to make the proposed section more consistent with the other proposed sections of the chapter. The commission agrees, and has amended the proposed section accordingly. One commenter suggested rewording proposed sec.40.4(c) for brevity and clarity. The commission agrees, and has amended the proposed section accordingly. One commenter noted that proposed sec.40.6 could be read to exclude the possibility of a matter being referred to ADR after a draft permit is proposed and a protest letter received, but prior to the matter being referred to the State Office of Administrative Hearings (SOAH), as proposed sec.55.25(d)(1) anticipates, and suggested amending the proposed section. The commission agrees with the commenter that this can be the most productive period for ADR, expressly desires to encourage ADR at this point, and has amended the proposed section to make it clear that cases may be referred to ADR at this point and that ADR outside of the commission process may be used at any time. Several commenters commented that proposed sec.50.13 and sec.50.33 allow the commission and its executive director to act on an application without considering any comments, and generally maintain that the proposed sections of procedural rules as a whole preclude public comment. The commenters also claim that the provisions of proposed sec.50.33 which prevent action by the executive director where there is a "protest" and the provision for motions for reconsideration are not an adequate substitute for a public comment process. The commission disagrees, and declines to amend the proposed sections. Proposed sec.50.13 and sec.50.33 allow action without a contested case hearing, which is not equivalent to action without considering comments. The procedures contained in the proposed procedural rules sections are, for the most part, in addition to the commission's public comment process, rather than a substitute for them, as the commenters apparently assume, and the equation of participation in a contested case hearing with public comment is inappropriate. The commission actively encourages public participation, and has gone on record repeatedly to express this and to broaden public participation, but believes that the amendments suggested by the commenters go far beyond the scope of this rulemaking. One commenter suggested that proposed sec.50.39 be amended to allow only an "affected person" to file a motion for reconsideration of an executive director's action on an application, suggesting that the term "other person" is too broad. The commission disagrees, and declines to change the proposed section, because the proposed language gives the commission flexibility to reconsider decisions in situations where the error complained of merits attention regardless of who raises it. Additionally, allowing any person to file a motion for reconsideration allows another avenue for public comment by bringing concerns directly to the attention of the commission. The commission believes, however, that the question of whether a person filing a motion for reconsideration is an affected person will in some cases have a bearing on whether the commission acts on the motion. Several commenters criticized proposed sec.55.21(b) and (d), claiming that because of multiple publications, it may be difficult to tell when the deadline for a hearing request occurs. While much of the timing and many of the contents of notices are specifically required by statute, to the extent that this becomes a problem, the commission plans to deal with it in rulemaking on a new proposed chapter governing public notice, rather than in this rulemaking. Several commenters suggested that proposed sec.55.21(c) constitutes an unlawful delegation and allows the person who designs a notice to decide what will be required in a hearing request. The commenters further assert that the proposed section does not adequately plan for errors in the published notice. The commission disagrees, and declines to change the proposed section. The statutes and other sections of the commission's rules dictate the content of public notices, and this proposed section merely requires hearing requests to comply with those requirements, if any. If the notice is defective, this must be generally cured through republication, thus giving another chance to comply with any requirements. Several commenters criticized proposed sec.55.21(e) for not establishing procedures for requesting extensions of time and suggested the inclusion of a "good cause" or public interest test. The commission disagrees. This section is primarily intended to allow the commission to consider late hearing requests. The commission believes that the proposed section allows more flexibility for the commission and the public than the suggestion does, and declines to change the section. One commenter suggested that proposed sec.55.23(b) be revised to require a group or association to provide an explanation of its hearing request with sworn affidavits, written resolutions, or other satisfactory documentation, rather than to allow other parties to request such an explanation. The commission disagrees. While the proposed sections anticipate that a group or association will submit such information, requiring this as an absolute requirement in advance when the group or association's qualifications are not in dispute is burdensome and unnecessary. However, allowing the listed parties to request that evidence, if they believe it to be an issue, protects the integrity of the hearing process and the rights of the applicant while limiting evidence and testimony to those issues that are actually in dispute. Several commenters suggested that proposed sec.55.23(b) and sec.55.26(f) place unreasonable burdens on the public in replying to responses to hearing requests. There is no proposed sec.55.26 and the latter reference is apparently to proposed sec.55.25(f). The commission disagrees, because these proposed sections merely provide a way for the commission and other parties to determine the basis of a hearing request, which is clearly relevant under Texas Water Code, sec.5.115. While the commission does not agree that the proposed time periods are unreasonable, it has determined that the time for replying to responses to hearing requests in proposed sec.55.25(f) should be lengthened from ten days to 14 days to give requestors more time to prepare, and has amended proposed sec.55.25 accordingly. Several commenters suggested that the commission amend proposed sec.sec.55.25, 55.27, 55.29, and 55.31, to change the way the commission deals with hearing requests and with determinations of whether a person is an "affected person," whether a request is "reasonable," and what constitutes "competent evidence" under Texas Water Code, sec.5.115. The commission agrees that these items may need further attention, but, as announced at the beginning of this phase of rulemaking and stated in the preamble to these proposed rules, has reserved this issue for further rulemaking, once sufficient experience has been accumulated with the existing process to fairly evaluate how well the existing rules are working. This project is already underway at the agency, and the commission expects that it will get into full swing shortly after this rulemaking project is concluded. While some minor adjustments to the current process are included in this round of rulemaking, the commission declines to make the suggested major changes in this round of rulemaking. Several commenters suggested that the proposed sections place an unreasonable burden on who can qualify for a hearing and claimed that the commission has not implemented its authority to provide for public participation in hearings. The commission disagrees. As noted previously, the commission believes that the proposed sections broadly encourage public participation. In addition, the proposed sections are entirely consistent with the law on hearings and standing. Finally, the commission is already committed to reviewing this process in another round of rulemaking. Several commenters suggested that proposed sec.55.25(g) be revised to allow a legislator (for an activity in the legislator's district), a state agency, a federal agency, or a local government (for a facility within the local government's jurisdiction) to send an application directly to SOAH for a contested case hearing. The commission disagrees. Nothing in the statutes grants such blanket rights, and the commission believes that adding this provision would violate both the letter and intent of Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115, as well as other specific statutes dealing with contested case hearings, and therefore declines to make this change. One commenter noted that the provisions of proposed sec.55.27 and sec.55.29 do not appear to address instances where the definition of affected persons in the rule (and in Texas Water Code, sec.5.115) may differ from specific statutory provisions defining "affected person" or "person affected," and suggested that the proposed sections be revised to make it clear that specific statutory provisions control. In the alternative, the commenter suggested that the commission apply both the definition of "affected person" in the proposed sections and any specific statutory definition. The commission agrees with the commenter that Texas Water Code, sec.5.115, the proposed sections, and other specific statutes can and should be read together. Generally, Texas Water Code, sec.5.115 will require a "personal justiciable interest," while other specific statutory provisions delineate those interests, specifying distance limitations or identifying specific persons who can request a hearing. The commission believes that the provisions of proposed sec.55.27 (that a hearing request be granted if it is "pursuant to a right to hearing authorized by law") and proposed sec.55.29 (that a relevant factor in determining whether a person has "a personal justiciable interest related to a legal right, duty, privilege, power, or economic interest affected by the application" is "whether the interest claimed is one protected by the law under which the application will be considered") require Texas Water Code, sec.5.115 and any applicable specific statute to be read together. Thus, the commission declines to modify the proposed sections. Several commenters suggested that proposed sec.55.27(b) and (c) be amended on the grounds that they conflict with statutory provisions such as Texas Water Code, Chapter 27, in which counties are granted hearings regardless of a showing of standing or reasonableness of their hearing requests. The commenters also suggested that the test for a state agency or local government needs to be clarified, alleging, for example, that a county is automatically an affected person for an activity in that county. The commission disagrees. No statute, other than those giving party status to the executive director, public interest counsel, Texas Water Development Board, and Texas Parks and Wildlife Department, provides as a blanket rule that a governmental entity is automatically an affected person for all activities in a geographic area, although some do in specific instances. Texas Water Code, sec.27.018, for instance, provides for a hearing on an injection well permit application if one is requested by a "local government." The statute further distinguishes between the terms "local government" and "affected person"--a distinction that does not appear in Texas Water Code, sec.5.115. While there may be some confusion over the use of the term "affected person" in more than one context, the commission believes that it is clear that a hearing request by a local government under Texas Water Code, sec.27.018 meets the tests of reasonableness and being "pursuant to a right to hearing authorized by law" under proposed sec.55.27(b) and "in the public interest" under proposed sec.55.27(c), and that a governmental entity may be an affected person given the definition of "person" contained in proposed sec.3.2 and its "authority under state law" in proposed sec.55.29(b). The commission further believes that the tests for a state agency or local government are sufficiently clear, and therefore declines to amend the proposed sections. Two commenters suggested that the provisions of proposed sec.55.27(c), which allow the commission to refer an application to SOAH for hearing if the commission determines that a hearing would be "in the public interest" even if there is no valid hearing request, be deleted or that the commission delineate standards it will use in making this determination. Several commenters suggested that the provision is vague in that it does not define "public interest." The commission disagrees with these comments and declines to make the suggested changes, in that it believes that there may be situations where the public interest demands a hearing (one example might be information received after the deadline for hearing requests), and also believes that it would be impossible to define "public interest" at this time in terms more specific than those used by the statutes under which the commission operates. One commenter suggested that proposed sec.55.27(c) be deleted as duplicative of proposed sec.55.27(b)(1). The commission disagrees and declines to make the proposed change. Proposed sec.55.27(b)(1) allows a commissioner, an applicant, or the executive director to request a contested case hearing and thereby refer a case to SOAH, while proposed sec.55.27(c) allows the commission as a whole to vote to send a case to SOAH. The two provisions serve different purposes and the commission believes they should be kept separate. Several commenters suggested that the commission's rules on notice need significant changes, and suggested that proposed sec.55.27(c) be amended to prohibit the final notice on a permit from being issued before technical review is complete and a draft decision is available. The commission does not agree that these proposed sections are the place to deal with notice requirements, notes that no notice has been given to the public or interested parties that notice requirements would be changed in these proposed sections, and points out that it is in the process of preparing for publication a new chapter to consolidate many of its notice rules. However, the commission disagrees with the commenters that the existing rules regarding notice are inadequate or restrict public participation. Proposed sec.55.27(c) does not deal with notice, but rather allows the commission to refer an application to SOAH even if there is no hearing request, and the commission does not agree that amending it to deal with notice would be appropriate or advisable. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear whether an administrative law judge can overrule a commission denial of a hearing request based on standing. The commission has amended proposed sec.55.27(f) to make its position on this issue more clear--that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. Several commenters commented that proposed sec.55.27(f) and (g) do not make it clear what must be done to appeal the denial of a hearing request, do not make it clear when the time period for appeal begins to run, and add new burdens by requiring two appeals. The commission does not agree, and declines to further amend the proposed sections beyond the amendments already described. The proposed sections make it clear that a party whose hearing request is denied must seek to obtain party status and then, if unsuccessful, follow procedures for a motion for rehearing as a prerequisite to appeal once the commission has disposed of the application. Since a person who files a hearing request is asking that a contested case hearing be held, that party obtains the relief sought if any hearing request is granted. That person must then seek to be admitted as a party if the person wishes to participate in the case, and decisions on that issue will be handled as they are now, although the commission anticipates that if the person has a complaint at this point, it will be the denial of party status or a limitation of issues rather than a determination on a hearing request. If all hearing requests are denied or withdrawn, persons whose requests are denied have an opportunity for the review of that decision by filing a motion for rehearing after the commission's decision on the application--that is, at the end of the case, rather than in an interlocutory appeal, as the commenters seem to suggest. The commission believes that it is clear in the proposed sections that the time period for appeals begins to run at this point. While the commenters also suggest that it is unreasonable to force parties to go through a hearing and have the result of that hearing reversed by a court based on an error in denying party status, the commission believes that the risk of this kind of result is minimal, is inherent in every determination of party status in any kind of proceeding, and is outweighed by the burden to the public that would be imposed by delaying every permitting decision until determinations of party status are appealed through the court system. Two commenters noted that proposed sec.55.27(f) allows a person whose hearing request is denied to still seek to be admitted as a party, and suggested that absent some compelling reasons, the commission's determination on the hearing request should preclude the later admission of the person as a party. The commission disagrees, and has amended the proposed section as noted previously to make it clear that the determination of the validity of a hearing request is an interlocutory determination of the validity of the request, and is not necessarily binding on a judge making a later determination of party status. A hearing request may be denied for reasons other than that the requesting person lacks standing. Similarly, it is possible that a person submitting an invalid hearing request may be able to demonstrate standing as a party should another hearing request be granted. The effect of this decision will clearly vary from case to case, however, and it seems clear that an administrative law judge does not have the authority to "overrule" the commission where the judge purports to decide the same issue given the same facts. One commenter suggested that proposed sec.55.27 be amended to allow a motion for reconsideration, rather than a motion for rehearing, of the denial of a hearing request, suggesting that the latter is only appropriate in contested cases under the Administrative Procedure Act, and that no contested case arises if a hearing request is not granted. The commission disagrees. As stated previously, the commission believes that a decision on the validity of a hearing request is an interlocutory decision only on the validity of the request, and does not necessarily dictate the outcome of a later decision on party status, or standing. The commission believes that a motion for rehearing at the conclusion of the proceedings is the most appropriate way to review such a decision. Several commenters remarked that the proposed sections do not allow for an adequate record for judicial review when no contested case hearing is held and do not establish standards for a court to use in its review. The commenters also suggest that the proposed sections do not create an adequate record in rulemaking. The commission disagrees, and declines to make changes based on this comment, because it believes that the record created is sufficient for judicial review of the commission's actions, and the standards of review are already clearly established in the statutes and rules. Similarly, the commission believes that the record created in rulemaking proceedings is more than adequate. Several commenters suggested that proposed sec.55.29 and sec.55.31 be revised to provide that the commission accept as true written statements of a person filing a hearing request for the purposes of the determination on the request or the person requesting a hearing be given an opportunity to present evidence to meet the burden of presenting competent evidence under Texas Water Code, sec.5.115. The commission disagrees and declines to make these changes. The first alternative ignores the clear intent of Texas Water Code, sec.5.115, by allowing a person to meet its standards by simply claiming that the standards are met. Texas Water Code, sec.5.115 provides that the commission "is not required to hold a hearing if the commission determines that the basis of the person's hearing request is unreasonable or is not supported by competent evidence." The second alternative does not recognize that this determination will require different procedures in different cases, and the flexibility which the proposed sections provide--from a decision on the pleadings to oral argument to an evidentiary hearing--allows for procedures to be followed which are appropriate for the cases presented. For example, a permit renewal under Texas Health and Safety Code, sec.382.056 may be an example of a case where requests not alleging increases in emissions or compliance problems can be dealt with on the pleadings alone. Similarly, a person who cannot allege a reasonable basis for a hearing request or who cannot allege that competent evidence exists to support the request, despite having more than one opportunity to do so (the request itself, a reply filed under proposed sec.55. 25(f) to responses that point out the merits or deficiencies of the request, and, in appropriate cases, argument or testimony before the commission) is not going to be able to present such evidence at a hearing, and it may be appropriate to resolve this request without an evidentiary hearing. Several commenters suggested that proposed sec.55.31 is unconstitutionally vague and conflicts with other Texas Natural Resource Conservation Commission rules and the law, specifically proposed sec.55.29 and Texas Health and Safety Code, sec.382.056 and Texas Water Code, sec.5.115 and that the provisions of proposed sec.55.31(b)(3) are overly burdensome on public participation. The commission disagrees. The commission believes that the proposed section fully complies with the constitution and with Texas Health and Safety Code, sec.382. 056 and Texas Water Code, sec.5.115. The term "reasonableness" is adequately defined by proposed sec.55.31. Further, proposed sec.55.31 does not conflict with proposed sec.55.29, because they deal with different matters--the first with the determination of whether a person is an "affected person," and the second with whether a hearing request is "reasonable." Several commenters suggested that the proposed rules be revised to "provide that the commission will make determinations and record those determinations so that the public can understand the basis for its government's decision and so that a reviewing court can determine if the actions of the commission should be affirmed or reversed." As noted previously, the commission believes that the proposed sections do exactly that and declines to make changes based on this comment. Several commenters suggested that proposed sec.55.33(a)(3) (and presumably proposed sec.80.5(a)(3)) be revised, claiming that the proposed section requires the Chief Clerk to pay the cost for issuing public notices. The commission disagrees, since the proposed section requires the clerk to issue notice and does not provide for the Clerk to pay the cost of notice, since applicants are clearly responsible for those costs. Proposed sec.55.33 has been withdrawn, however, and only proposed sec.80.5 now governs the Chief Clerk's actions in this context. Several commenters noted that the setting procedures of proposed sec.55.33 largely duplicate those of proposed sec.80.5, and suggested the deletion of one or the other. Some commenters suggested conforming these two proposed sections. The commission agrees that these sections are duplicative and should be conformed, and notes as well that proposed sec.70.109 largely duplicates both of these sections. For clarity, the commission believes that it is most logical to lay out all setting procedures only in proposed Chapter 80, and has deleted proposed sec.55.33 and amended proposed sec.70.109 accordingly. Several commenters suggested that the proposed sections of proposed Chapter 70 limit public participation in enforcement proceedings in a fashion that does not meet the federal requirements for such participation and further state that notice in the Texas Register is insufficient. The commission disagrees, and declines to change the proposed sections. The agency complies with federal authorization rules regarding public participation in enforcement matters, which require the agency to have procedures in place for responding to citizen complaints, publish notice of settlements of civil actions, and give assurance that it will not oppose intervention by any citizen when permissive intervention is authorized by statute, rule, or regulation. In regard to the comment that Texas Register publication is insufficient, while the commission disagrees, it is currently considering alternative citizen participation in administrative actions. If rule changes are necessary after a decision is made on this issue, they will be taken up separate from this rulemaking. One commenter suggested that the definitions of "enforcement order," "enforcement action," "petition," and "respondent" be moved from proposed sec.70.2 to proposed sec.3.2. The commission agrees that the definitions of "enforcement action" and "enforcement order" should be moved to sec.3.2 since they are used in general context in other chapters of the agency's rules; however, the terms "petition" and "respondent," as they are defined in proposed Chapter 70, are specific to enforcement actions by the commission only and should remain in proposed Chapter 70. The commission does not believe that generic definitions of petition and respondent are necessary in proposed Chapter 3 to cover permitting matters because those terms are generally accepted legal terminology and "petition" is already included in the definition of "application." One commenter suggested that proposed sec.70.51 substantially changes old sec.337.71 from relating only to water rights enforcement matters to a more general mandatory enforcement hearing process. The commission disagrees. The language in proposed sec.70.51 was taken verbatim from old sec.337.71, except that the title of the subchapter was changed and references to other rules which had been renumbered were changed. The definitions included in old sec.337. 71 included water quality, water rights, hazardous waste releases, and references to the air statute as well. Although the title of old sec.337.71 indicated "Water Rights Enforcement," its statutory basis is Texas Water Code, sec.5.117, which applies to the agency as a whole, and requires the executive director to bring all instances of substantial noncompliance before the commission. The commenter expressed concern that proposed sec.70.51 would require mandatory hearings for incorrect compliance with record keeping requirements in an air permit. Since this would normally not be a substantial noncompliance under the air rules, this section would not apply in that case. Furthermore, old sec.337.71 and proposed sec.70.51 both exclude air violations, since a separate statutory requirement exists for the air program. The program most affected by this statutory requirement is the water quality program, which has a large amount of self-reporting data submitted each month. The proposed section basically sets forth the practice of the watershed management and enforcement divisions in processing this large volume of documents and describes how they determine what constitutes a substantial noncompliance. One commenter suggested that the concept of "executive director preliminary reports" (EDPR), used in proposed sec.70.101, is not necessary in proposed Chapter 70 and is not mandated by statute. While EDPRs are not required by statute, they are clearly allowed and anticipated by statute (see Texas Water Code, sec.sec.13.4151(c) and (d), 26.136(d) and (e), 27.1015(d) and (e), 34. 011(d) and (e) and Texas Health and Safety Code, sec.sec.341.049(c) and (d), 361. 252(d) and (e), 366.0924(d) and (e), 382.088(d) and (f), and 401.384- 401.385). This rulemaking does not alter the provisions in old Chapter 337 regarding preliminary reports, and sets forth the agency's procedures if preliminary reports are chosen as the form of pleading in a case. The executive director is not required to issue a preliminary report, but is given an option which may be used on a case-by-case basis, which is consistent with the statutory provisions. The commission disagrees with the comment and declines to change the proposed section. The commission has determined that the setting procedures of proposed sec.70. 109 largely duplicate those of proposed sec.80.5, and has amended them to simply refer to proposed sec.80.5. The commission has also amended the title of this section for clarity. One commenter suggested that proposed sec.80.3(a) be amended to make it clear that the judge sitting in a phase of a hearing, not the presiding judge, will resolve evidentiary questions raised during that phase of a hearing. The commission generally agrees, but believes that it may be necessary for a judge sitting in one phase of a hearing to refer some important evidentiary questions to the presiding judge, and has amended the section accordingly. Two commenters suggested that proposed sec.80.3(b)(10) be revised to make it clear that the judge may limit the time of presentation of evidence and witnesses without unfairly prejudicing the rights of parties. The commission agrees, and has amended the rule accordingly. In addition, the commission believes that splitting proposed sec.80.3(a) into two subsections and redesignating proposed sec.80.3(b) as sec.80.3(c) makes the proposed rule more readable, and has amended it accordingly. Two commenters suggested that proposed sec.80.5(b) be amended to expressly state that the commission may limit the issues that shall be considered by SOAH in a contested case. The commission agrees that this ability is implicit in Texas Government Code, sec.2003.047(e), and has amended the proposed section accordingly. These commenters also suggest that the proposed section be amended to provide that the commission "may," rather than "shall," identify issues to be addressed. Since Texas Government Code, sec.2003.047(e) uses "shall," the commission disagrees and declines to make this change. The commission has amended proposed sec.80.5(b) to make it clear that the executive director's petition or EDPR serves as the list of issues to be addressed by SOAH in a contested enforcement case. One commenter suggested that proposed sec.55.33(b) (the same as proposed sec.80.5(b)) be deleted, stating that while the commission may want to restrict or direct the list of issues, the proposed section suggests that a referral is not adequate if it does not. The commission disagrees, since Texas Government Code, sec.2003.047(e) clearly mandates an issues list, and since the proposed section gives the commission the flexibility to submit both broad and narrow ranges of issues. Several commenters suggested that proposed sec.80.13 be amended to allow parties, as well as the executive director, to request consolidation of related proceedings. The commission disagrees and declines to change the proposed section, because this is already allowed by the proposed sections. Proposed sec.80.13 allows the executive director to consolidate matters with the permission of the judge, and allows the judge to consolidate matters, presumably on the judge's own motion or that of any party. One commenter noted that due to changes in Chapter 291 of the commission's rules, proposed sec.80.17 does not accurately reflect the burden of proof in certain water and sewer rate cases. The commenter also noted that enforcement cases covered by subsection (c) of the rule should be expressly excepted from subsection (a). The commission agrees, and has amended the proposed section accordingly. One commenter suggested that proposed sec.80.27 be deleted as duplicative of proposed sec.sec.1.08, 1.10, 1.11, and 80.31. While the proposed sections cover similar matters, the commission disagrees and declines to make the change, because proposed sec.80.27 covers mostly matters of form, while the other proposed sections deal with more procedural matters. The commission has amended proposed sec.80.101 to make it clear that the executive director may either act on a matter remanded to the executive director or set it for consideration at a commission meeting. This is allowed by the proposed section, but the amendment lends clarity. One commenter suggested that proposed sec.80.107 is of sufficient importance that it should be dealt with as a separate subchapter. While the commission agrees that the proposed section is important, it prefers as a matter of form at this time not to create additional subchapters, and declines to make the change. One commenter suggested deleting the phrase "administrative law" from a reference in proposed sec.80.107(a)(3) to result in consistent references to the presiding officer as "judge." The commission agrees, and has amended the proposed section accordingly. One commenter suggested amending proposed sec.80.109(b) to define only statutory parties. The commission disagrees, and believes that the proposed section serves a more useful function by referring to all parties to an application, rather than just statutory parties, and declines to make this change. One commenter suggested deleting proposed sec.80.109(c) as duplicative of proposed sec.80.115. The commission agrees, and has amended the proposed section accordingly, renumbering the subsequent subsections. One commenter suggested deleting proposed sec.80.109(d) (now sec.80.109(c)) as duplicative of proposed sec.80.3(b)(5). The commission disagrees, since the section as amended in response to comments on proposed sec.80.115 now makes it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. One commenter suggested moving proposed sec.80.109(e) ((now sec.80.109(d)) to proposed sec.80.119, arguing that it makes more sense to discuss the effects of continuance in that section. The commission disagrees and declines to make the change. Proposed sec.80.109(e) (now sec.80.109(d)) is intended to make it clear that a person designated as a party retains party status regardless of any postponement of a hearing. Since the rule is limited to party status, the commission feels that it makes more sense to leave it in its present location. Several commenters commented that proposed sec.80.111 prohibits the judge and commission from considering comments. The commission disagrees, and points out that the section does not at all impair the executive director's ability to consider comments. The proposed section prohibits the judge from considering protests or comments submitted by non-parties in a non-evidentiary context (not under oath and without the opportunity to cross-examine) as evidence in contested case proceedings. The commission believes this is required by law, and declines to change the proposed section. The commission notes, however, that the phrase "[i]n proceedings other than enforcement proceedings" was inadvertently published as the end of the second sentence of this section, rather than as the beginning of the third sentence. The commission has amended the section accordingly, so that this limitation applies to questions submitted to the judge, not to the consideration of comments. One commenter noted that proposed sec.80.115 is not clear as to whether each and every party has a right to conduct discovery, present a direct case, cross- examine witnesses, obtain copies of pleadings, and so on, even when parties have been aligned under proposed sec.80.109. The commission agrees that the two provisions could be confusing when read together, and has amended proposed sec.80.109(d) to make it clear that unless a judge orders otherwise, aligned parties shall be considered one party for the purposes of sec.80.115 for all purposes except settlement. The commission anticipates that judges will exercise their best judgment when aligning parties and specifying the purposes for which they are aligned. One commenter suggested that proposed sec.80.117(b) be revised to make it clear that all persons granted party status are covered in the order of presentation. The commission agrees, and has amended proposed sec.80.117 by substituting the words "other parties" for the word "protestant." One commenter suggested deleting the word "SOAH" from proposed sec.80.119(d) to make it clear that the section does not restrict the judge in a contested case proceeding to the use solely of SOAH mediators. The commission agrees, and has amended the proposed subsection accordingly. The subsection has also been combined with proposed sec.80.119(c), to make the section shorter and more clear. One commenter suggested combining proposed sec.80.127(a)(2) and (c) to eliminate duplication. The commission agrees, and has amended the proposed section and renumbered subsections accordingly. One commenter suggested that proposed sec.80.127 be revised to more closely track the provisions of Texas Rule of Civil Procedure 267 and Texas Rule of Evidence 613, which prohibit the exclusion from the hearing room when "the rule" is invoked of an officer or employee of a party that is not a natural person and who is designated as its representative by its attorney and a person whose presence is shown by a party to be essential to the presentation of its case. The commission agrees, and has added subsection (f) to the proposed section so that it will more closely track the practice in the courts. One commenter suggested amending proposed sec.80.133 to allow the judge to set a schedule for the submission of written briefs. The commission agrees, and has amended the proposed section accordingly. Two commenters suggested that proposed sec.80.137 be amended to incorporate by reference Texas Rule of Civil Procedure 166a, because of the substantial body of interpretive case law and legal commentary available. The commission agrees that Rule 166a contains valuable guidance, and has tried to track the language of the rule in the proposed section as far as it considers appropriate given the difference between the administrative and judicial processes and the commission's assumption that the most likely use of the proposed section will be to limit issues, rather than to dispose of applications. The commission has accordingly modified the proposed section to track Rule 166a more closely, and anticipates that practitioners and judges will look to Rule 166a and the decisions construing it for guidance. Two commenters suggested that proposed sec.80.137 be amended to change some language relating to testimonial evidence. Because of the amendments noted previously, the commission believes the issue raised by this language to be resolved and declines to make further changes. One commenter suggested that proposed sec.80.151 be amended to expressly refer to Texas Rule of Civil Procedure 215. The commission disagrees, and declines to change the proposed section, because it believes that the grant of authority in Texas Government Code, sec.2003.047 and the sanctions provisions of proposed sec.80.107 already make sufficient provision for sanctions for discovery abuse. One commenter suggested that proposed Subchapter E of Chapter 80 (the "Freeze Rules") be deleted. While the commission recognizes the commenter's concern, it feels that the "freeze rules" have not yet been given a real test in practice, and is inclined to amend, rather than repeal them. The commission has corrected an incorrect reference in proposed sec.80.205 to refer to sec.80.105, rather than sec.80.60. Several commenters suggested that proposed sec.80.203(a)(1) be amended so that it does not require the executive director to prepare a draft permit if the executive director does not recommend the issuance of a permit. The commission disagrees, and declines to make this change, in part because the "freeze rules" were the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome, and in part because the failure to prepare a draft permit would present an almost insuperable barrier to an applicant should the applicant prevail on the issue of whether or not a permit should be issued. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.207(c) be amended to eliminate the additional time proposed beyond the first discovery period for filing a list of issues. The commission disagrees, and declines to make this change. An earlier version of this rule required protestants to have their issues list finished simultaneously with the end of the first discovery period, which the commission believes compresses the work that must be done. The commenter suggested that in the event the additional time remained, additional time should be added to proposed sec.80.207(e) as well. The commission disagrees and declines to make this change, since additional time is already granted by timing the applicant's response from the time the first list of issues is submitted, rather than the close of the first discovery period. Several commenters commented that proposed sec.80.207(d) allows an applicant to disrupt the work required of protestants to comply with subsection proposed sec.80.207(c), and suggested the deletion of the second sentence in subsection (d). The commission disagrees, and declines to make this change. The commenters apparently missed the time extension given in proposed sec.80.207(c), which now allows for completion of the issues list "within 20 days after the end" of the time period originally contained in old sec.265.104, from which the proposed section is derived. The result of the proposed sections is to give the protestant an additional 20 days to complete the issues list, while allowing the applicant to go forward with discovery. The result, rather than an additional burden on the protestant, is an easing of requirements. One commenter suggested that proposed sec.80.207(h) be amended to allow a limited amendment of the application in some circumstances. While the commission agrees that this commenter's point has some merit, the current arrangement was the product of extensive negotiations among stakeholders and staff, and this point appears to be one of those which was central to the outcome. Rather than repeal or extensively modify the "freeze rules" at this time, the commission believes it wiser to make minor amendments and wait to see how the rules function in actual practice. One commenter suggested that proposed sec.80.209(c)(3) be amended to require the judge to distribute a prehearing order within four days from the prehearing conference. While the commission recognizes the commenter's concern and the limited (14-day) time period between the prehearing conference and the hearing, it prefers at this time to leave the timing of the prehearing order to the judge, trusting that prehearing orders will be distributed as soon as possible considering the compressed time frame. Two commenters suggested that proposed sec.80.213 be revised to make it clear that paragraphs (1)(A) and (B) are not mutually exclusive and that the judge may direct a party to both voluntarily reduce its listed witnesses and provide a summary of the expected testimony of each witness. One commenter also suggested that the language of the rule be made more clear that the judge may prohibit testimony of witnesses. The commission agrees, and has amended the section accordingly. Several commenters suggested that proposed sec.80.259 be revised to eliminate a provision that would allow a judge to file an amended proposal for decision without serving it on the parties. This provision was included in a redline/strikeout version of the proposed rules distributed by agency staff during the rulemaking process, but was dropped from the proposed rule before publication, and thus no revision to the proposed rule is necessary. The staff regrets any inconvenience caused by failing to notify interested persons of the change before publication. The commission has amended proposed sec.80.263 to make it clear that the general counsel may set time limits for oral presentations before the commission. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.sec.80.265, 80.267, and 80.271 to remove the word "final" where it refers to commission decisions or orders, because the use of the word in these proposed sections may be unintentionally confusing when compared with the use of the word in Government Code, sec.sec.2001.141-2001.144, dealing with when decisions become final. One commenter suggested that the provision of proposed sec.80.267(b) that the commission will render a decision within 60 days after the date the hearing is finally closed does not give the commission enough time to render its decisions. The commenter suggested lengthening the time period to 90 days. The commission agrees that cases heard by a judge may take more than 60 days, but notes that the 60-day period is mandated by Texas Government Code, sec.2001. 143 unless extended. The commission believes, however, that proposed sec.80. 267(b) gives the judge enough flexibility to extend the time, and therefore declines to make the suggested revision. The commission has amended proposed sec.80.277 to more clearly reflect the commission's position and longstanding agency practice that the executive director or an authorized representative may forward an enforcement order to the attorney general for enforcement. This is allowed by the proposed section, but the amendment lends clarity. The commission has amended proposed sec.86.18(c)(1)(C) to change the time period for filing applications for rehearing to 30 days to be consistent with Water Code, sec.11.316. One commenter suggested that the definition of "monitoring well" in proposed sec.340.2 be amended to expressly exclude monitoring wells used in conjunction with the production of coal and lignite, as is apparently intended by the general exclusion for wells used in conjunction with the production of "other minerals." The commission agrees, and has amended the section accordingly. One commenter noted that proposed sec.340.73 appears to differ from the requirements under discussion at the agency for sec.338.31 and sec.338.32 as to the persons to whom copies of well logs are to be submitted. The commission agrees, and has amended proposed sec.340.73 and sec.340.75 to add local underground water conservation districts and make these sections consistent. Subchapter A. Introductory Provisions 30 TAC sec.sec.340.1, 340.3-340.7, 340.10, 340.15 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606827 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 30 TAC sec.sec.340.1-340.3 The new sections and amendment are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec. sec.341.002, 341.031, 361.011, 361.017, 361. 024, 366.012, 382.017, 401.011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.340.2. Definitions. The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise. Complainant-A party who has filed a signed, written complaint with the commission against any party subject to the jurisdiction of the commission. Dewatering well -Any artificial excavation constructed to produce groundwater to lower the water table or potentiometric surface. The term does not include a dewatering well that is used to produce or to facilitate the production of minerals under a state regulatory program. Dewatering well driller-A person, including an owner, operator, contractor, or drilling supervisor, who drills, bores, cores, or constructs a dewatering well. The term does not include a person who drills, bores, cores, or constructs a dewatering well under the direct supervision of a licensed dewatering well driller and who is not primarily responsible for the drilling operation. Groundwater-Water below the land surface in a zone of saturation. Injection well -A well into which fluids are injected including: (A) an air-conditioning return flow well used to return water that has been used for heating or cooling in a heat pump to the aquifer that supplied the water; (B) a cooling water return flow well used to inject water that has been used for cooling; (C) a drainage well used to drain surface fluid into a subsurface formation; (D) a recharge well used to replenish water in an aquifer; (E) a saltwater intrusion barrier well used to inject water into a fresh water aquifer to prevent the intrusion of salt water into fresh water; (F) a sand backfill well used to inject a mixture of water and sand, mill tailings, or other solids into subsurface mines; (G) a subsidence control well used to inject fluids into a non-oil producing or non-gas producing zone to reduce or eliminate subsidence associated with the overdraft of fresh water; and (H) a closed system geothermal well used to circulate water, other fluids, or gases through the earth as a heat source or heat sink. Injection well driller-A person, including an owner, operator, contractor, or drilling supervisor, who drills, bores, cores, or constructs an injection well. The term does not include a person who drills, bores, cores, or constructs an injection well under the direct supervision of a licensed injection well driller and who is not primarily responsible for the drilling operation. Licensed installer -A person who holds a license for pump installation issued under this chapter. Monitoring well -Any artificial excavation constructed to measure or monitor the quality and quantity or movement of substances, elements, chemicals, or fluids below the surface of the ground. The term does not include any monitoring well used in conjunction with the production of oil, gas, coal, lignite, or any other minerals. Included within this definition are environmental soil borings, piezometer wells, observation wells, and recovery wells. Monitoring well driller-A person, including an owner, operator, contractor or drilling supervisor, who drills, bores, cores, or constructs a monitoring well. Pollution-The alteration of the physical, thermal, chemical, or biological quality of water in a way that makes the water harmful to humans, animals, vegetation, property, or that impairs the public enjoyment of water for a reasonable purpose. Pump installer -A person who installs or repairs water well pumps and equipment for hire or compensation. Water well-Any artificial excavation constructed for the purpose of exploring for or producing groundwater. The term does not include any test or blast holes in quarries or mines, or any well or excavation constructed to explore for, or produce oil, gas, or any other minerals unless the holes are used to produce groundwater. The term does not include any injection water source well regulated by the Railroad Commission of Texas under Natural Resources Code, sec.91.101. Water well driller -Any person (including an owner, operator, contractor, or drilling supervisor) who drills, bores, cores, or constructs any water well in this state. The term does not include any person who drills, bores, cores, or constructs a water well on his own property for his own use or a person who assists in the construction of a water well under the direct supervision of a licensed driller and is not primarily responsible for the drilling operations. Water Well Drillers Advisory Council (council)-A nine-member council established by statute in Texas Water Code, sec.32.006 whose members commission. The council is responsible for advising the commission on matters pertaining to water well drillers and pump installers. Well pumps and equipment-Equipment and materials used to obtain water from a well, including the seals and safeguards necessary to protect the water from contamination. (h) A majority of the board is a quorum for conducting business. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606825 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter B. Licensing Procedures 30 TAC sec.sec.340.31, 340.33, 340.35, 340.37, 340.39, 340.41, 340.43, 340.45, 340.49, 340.51, 340.53 The new sections and amendments are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec. sec.341.002, 341.031, 361.011, 361.017, 361. 024, 366.012, 382.017, 401.011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.340.41. Examination Fee. (a) (No change.) (b) Each time an applicant applies to retake the commission's examination, an applicant must submit the examination fee. sec.340.43. Certification by the Executive Director. (a) The executive director, with advice of the council, shall review and pass upon each applicant's qualifications. (b) In assessing an applicant's qualifications, the executive director and the council shall examine the letters of reference submitted, the applicant's experience and competence in water well drilling or pump installing and related fields, residency status, and any other relevant information which may be presented including, but not limited to, compliance history. (c) An applicant, at the discretion of the executive director, may not be certified for up to a one-year period following a finding by the commission or a court of competent jurisdiction which resulted in the revocation of the applicant's license or a finding that the applicant operated without a license in violation of Texas Water Code, sec.32.002 and/or sec.33.002 and/or sec.340.31 of this title (relating to License Required). (d) After assessing the qualifications of an applicant, the executive director, with advice of the council, shall determine the type(s) of well drilling or pump installation, if any, it finds the applicant competent to perform. Types of drilling include water well, monitoring well, injection well, and dewatering well. Types of pump installation include: windmills, hand pumps, and pump jacks; fractional to five horsepower; submersible five horsepower and over; and line-shaft turbine pumps. An applicant who has demonstrated competency in water well drilling shall be deemed qualified for licensing for all other types of drilling. An applicant who has demonstrated competency in all types of pump installation shall be deemed qualified for a master pump installer's license. (e) A licensee, not licensed to perform all types of well drilling and pump installation, may apply for designation for additional types of well drilling or pump installation. Applications for additional designations shall be accompanied by the appropriate application fee and shall contain all information required by this subchapter for an initial license, except information regarding residency and letters of reference from the applicant's banker. Upon examination of the applicant's qualifications, the executive director, with advice of the council, shall make his recommendation on the application. sec.340.45. Disposition of Application. The executive director shall mail notice to each applicant as to the disposition of his or her application within ten days of the final decision. An applicant who disagrees with the executive director's final decision, the applicant may file a motion for reconsideration under sec.50.39 of this title (relating to Motion for Reconsideration). sec.340.53. License Renewal. (a) On or before the expiration date of the license, the licensee shall pay to the commission a $125 or, for combination water well driller and pump installer licenses, a $175 renewal fee and submit an application for renewal. (b) If a person's license has been expired 90 days or less, the person may renew the license by paying to the commission the required renewal fee and a late fee equal to one-half the examination fee ($50). (c) If a person's license has been expired for more than 90 days but less than two years, the person may renew the license by paying all renewal fees and a late fee that is equal to the examination fee ($100). (d) If a person's license has been expired for two years or more, the person may not renew the license; the person may obtain a new license by submitting to reexamination and complying with all requirements and procedures for obtaining an original license. (e) When a licensee has made timely and sufficient application for the renewal of a license, the existing license does not expire until action on the application has been finally determined by the commission, and in case the application is denied or the terms of the new license limited, until the last day for seeking review of the commission order or a later date fixed by order of the reviewing court. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606823 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 sec.340.43, sec.340.49 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606828 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter C. Duties of Licensed Water Well Drillers and Pump Installers 30 TAC sec.sec.340.71, 340.73, 340.75, 340.77 The amendments are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.340.71. Marking Vehicles and Equipment. It is the duty of all licensed water well drillers and pump installers to see that all water well rigs and pump installer vehicles used by them or their employees in the water well drilling or pump installer business are marked with legible and plainly visible identification numbers at all times. (1) The identification number to be used on water well rigs shall be the license number of the water well driller responsible for the water well drilling operations. The identification number to be used on pump installer vehicles shall be the license number of the pump installer responsible for installing or repairing the pump, the owner of the business if the owner has a pump installer's license, or the designated licensed supervising pump installer. (2) License numbers shall be printed, upon each side of every water well rig or pump installer vehicle, not less than two inches high and in a color sufficiently different from the color of the vehicle or equipment so that the license number shall be plainly legible. (3) A driller or pump installer shall have 30 days from the date a license is issued to see that all water well rigs or pump installer vehicles used by him or his employees are marked as provided in paragraphs (1) and (2) of this section. sec.340.73. Well Logs. (a) Every licensed well driller, deepening or otherwise altering a well within this state shall make and keep a legible and accurate well log on forms supplied by the executive director. The well log shall be recorded at the time of drilling and must show the depth, thickness, and character of the strata penetrated, the location of water-bearing strata, the depth, size, and character of casing installed, and any other information required by this section. (b) Every licensed driller shall deliver or transmit by certified mail the original of the well log to the commission, and shall deliver or send by first- class mail a photocopy to the local underground water conservation district and a copy to the owner or the person for whom the well was drilled within 60 days from the completion or cessation of drilling, deepening, or otherwise altering a well. (c) Every licensed water well driller shall inform the owner or person having the water well drilled, deepened, or otherwise altered, that such person may submit a written request both by certified mail to the commission and in person or by first-class mail to the local underground water conservation district that the well log be kept confidential and exempt from disclosure as a public record. sec.340.75. Plugging and Completion of Water Wells. (a) Each licensed well driller shall assure that all wells are plugged, repaired, or properly completed according to commission rules and Texas Water Code, sec.32. 017 (relating to plugging of water wells). Each pump installer shall install or repair pumps according to commission rules and Texas Water Code, sec.33.014 (relating to completion, repair, and plugging of water wells). (b) A licensed driller or pump installer shall notify the commission, the local underground water conservation district if required by the local authority, and the landowner or person having a well drilled or pump installed when he encounters water injurious to vegetation, land, or other water, and the well must be plugged, repaired, or properly completed in order to avoid injury or pollution. (c) A licensed driller or pump installer who knows of an abandoned or deteriorated well, as those terms are defined by Texas Water Code, sec.32.017 and sec.33.014 (relating to completion, repair, and plugging of water wells), shall notify the landowner or person possessing the well that the well must be plugged or capped in order to avoid injury or pollution. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606824 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter D. Driller Trainee Registration 30 TAC sec.sec.340.81-340.86 The new sections and amendment are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec. sec.341.002, 341.031, 361.011, 361.017, 361. 024, 366.012, 382.017, 401.011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606843 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 30 TAC sec.sec.340.82-340.87 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606829 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter E. Pump Installer Apprentices 30 TAC sec.sec.340.88-340.93 The new sections are adopted under Texas Water Code, sec. sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606844 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter E. Standards of Conduct 30 TAC sec.sec.340.91, 340.93, 340.95, 340.97, 340.99 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606830 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter F. Standards of Conduct 30 TAC sec.sec.340.101, 340.103, 340.105, 340.107, 340.109, 340. 111 The new sections and amendment are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec. sec.341.002, 341.031, 361.011, 361.017, 361. 024, 366.012, 382.017, 401.011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606845 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter G. Disposition of Violations 30 TAC sec.sec.340.131, 340.133, 340.135, 340.137 The new sections and amendment are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec. sec.341.002, 341.031, 361.011, 361.017, 361. 024, 366.012, 382.017, 401.011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. sec.340.131. Disciplinary Actions. (a) The commission may assess an administrative penalty, reprimand a licensee, suspend or revoke a license, or take any appropriate action described in Chapters 70 and 80 of this title (relating to Enforcement and Contested Case Hearings) or Texas Water Code, Chapters 32 and 33 (relating to Water Well Drillers and Pump Installers) for violations of the statutes or commission rules. (b) Grounds for disciplinary action include, but are not limited to, the following: (1) intentionally misstating or misrepresenting a fact on an application, renewal application, well log, plugging report, or in connection with any other information or evidence furnished to the agency in connection with official commission matters; (2) (No change.) (3) failing to mark a water well rig or pump installation vehicle as required by sec.340.71 of this title (relating to Marking Vehicles and Equipment); (4) failing to advise a person for whom a well is being drilled, deepened, or otherwise altered (including pump and related equipment installation) that injurious water has been encountered, that this poses a potential pollution hazard, and that the well must be plugged or properly completed according to sec.340.75 of this title (relating to Plugging and Completion of Water Wells); (5) failing to properly plug, repair, or complete a well which has encountered water injurious to vegetation, land, or other water according to sec.340.75 of this title; (6) failing to provide direct supervision to an unlicensed driller or a registered driller trainee or pump installer apprentice whom the licensed driller or installer has agreed to supervise according to commission rules; (7) aiding and abetting an unlicensed person to violate Texas Water Code, Chapters 32 and 33, knowingly combining or conspiring with an unlicensed person, allowing his license to be used by an unlicensed person, or acting as an agent, partner, associate, or otherwise, of an unlicensed person with the intent to violate Texas Water Code, Chapters 32 and 33, this chapter, and, Chapter 338 of this title (relating to Water Well Drillers Rules and Water Well Pump Installers); (8) violating the commission's standards of conduct; (9) conducting himself as an incompetent driller or pump installer; (10) failing in any other material respect to comply with Texas Water Code, Chapters 32 and 33, Chapter 338 of this title (relating to Water Well Drillers Rules and Pump Installers), or this chapter; (11) misrepresenting or misstating the class of well or pump which the licensee is licensed to drill or install. (c) Procedures relating to complaints. (1) Any person who believes that a licensed driller or pump installer has violated or is violating Texas Water Code, Chapters 32 and 33, Chapter 338 of this title (relating to Water Well Drillers Rules and Water Well Pump Installers), or this chapter may file a signed written complaint with the executive director which briefly states: (A) the licensed driller or pump installer's name, address, and, if known, the licensed driller's or pump installer's business name and address; (B)-(C) (No change.) (D) the complainant's name, telephone number, and address. (2) If the executive director determines that enforcement action is warranted in response to the complaint, such action shall be taken under Chapters 70 and 80 of this title (relating to Enforcement and Contested Case Hearings). This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606846 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter F. Disposition of Violations 30 TAC sec.sec.340.133, 340.135, 340.137 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606831 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Chapter 341. Practice and Procedure The commission adopts the repeal of sec.sec.341.1-341.18, 341.20-341.22, 341.31-341.42, 341.51-341.75, 341.81-341.90, 341.101, 341.102, 341.111-341.117, and 341.131-341.138, concerning procedural rules. The repeals are adopted without changes to the proposed text as published in the March 19, 1996, issue of the Texas Register (21 TexReg 2192) and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. No comments were received regarding adoption of the repeals. Subchapter A. General Rules of Procedure 30 TAC sec.sec.341.1-341.18, 341.20-341.22 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606847 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter B. Procedures Before Public Hearing 30 TAC sec.sec.341.31-341.42 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606848 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter C. Duties of Licensed Water Well Drillers 30 TAC sec.sec.341.51-341.75 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606832 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter D. Procedures after Public Hearing Before an Examiner 30 TAC sec.sec.341.81-341.90 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606833 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter E. Procedures after Public Hearing Before an Agency Quorum 30 TAC sec.341.101, sec.341.102 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606834 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter F. Procedures after Final Decision 30 TAC sec.sec.341.111-341.117 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606835 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Subchapter G. Special Procedures 30 TAC sec.sec.341.131-341.138 The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13. 041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401. 011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606836 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 239-1966 Chapter 345. Advisory Committee Rules 30 TAC sec.sec.345.1-345.14 The commission adopts the repeal of sec.sec.345.1-345.14, concerning procedural rules. The repeals are adopted without changes to the proposed text as published in the February 20, 1996, issue of the Texas Register (21 TexReg 1371) and will not be republished. This is the second phase (Phase II) of an ongoing project to reorganize, clarify, and consolidate the commission's procedural rules. The first phase (Phase I) was intended to implement recent legislation and was completed in the summer of 1995. Phase I made limited substantive changes to the commission's rules and began limited reorganization. Phase II is a more ambitious attempt to reorganize and consolidate the commission's procedural rules, and to eliminate conflicting procedural requirements based solely on media or type of hearing. By consolidating these rules, the commission seeks to cut back on the duplication of requirements and definitions that might create unwarranted non-statutory differences in the treatment of persons working with the commission. As part of this ongoing project, the commission is continuing to examine program and media specific rules for inconsistency with the general rules of the agency. It is anticipated that any further consolidation will be proposed as amendments to specific programs or chapters and not as a further major revision to these procedural rules. Numbering changes attempt to impose a more logical organization upon the most widely applicable rules of the commission by taking advantage of newly available chapters in Title 30. Chapters 1-99 will be reserved for the procedural rules and broadly applicable substantive rules of the commission. By locating generally applicable rules at the beginning of Title 30, commission rules should be organized in a more logical and user-friendly format. The proposed new format consists of the following reservation of chapters: Chapters 1-10-general rules of the commission; Chapters 11-19-miscellaneous provisions not specific to any media; Chapters 20-29-rulemaking; Chapters 30-49-application procedures; Chapters 50-69-processing of applications; Chapter 70-79-enforcement; Chapter 80-89-hearings-contested/other. The current proposal conforms to this new format. No comments were received regarding adoption of the repeals. The repeals are adopted under Texas Water Code, sec.sec.5.103, 5.105, 13.041, 26.011, 27.019, 32.009, 33.007, and 34.006 and Texas Health and Safety Code, sec.sec.341.002, 341.031, 361.011, 361.017, 361.024, 366.012, 382.017, 401.011, 401.051, and 401.412, which authorize the commission to adopt any rules necessary to carry out its powers and duties under the Water Code and other laws of Texas and to establish and approve all general policy of the commission. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 3, 1996. TRD-9606837 Kevin McCalla Director, Legal Services Division Texas Natural Resource Conservation Commission Effective date: June 6, 1996 Proposal publication date: February 20, 1996 For further information, please call: (512) 239-1966 TITLE 31. NATURAL RESOURCES AND CONSERVATION Part X. Texas Water Development Board Chapter 365. Investment Rules The Texas Water Development Board (the board) adopts amendments to 31 TAC Chapter 365 regarding Investment Rules. The Board adopts the amendment to sec.365.2 with changes to the proposed text as published in the March 19, 1996 issue of the Texas Register (21 TexReg 2196). The Board adopts amendments to sec.sec.365.1, 365.11, and 365.12, repeal of sec.sec.365.21-365.24, sec. sec.365.31-365.35, and sec.sec.365.51-365.54, and new sec.sec.365.5-365.10 and sec.sec.365. 13-365.21 without changes to the proposed text as published in the March 19, 1996 issue of the Texas Register (21 TexReg 2196) and will not be republished. The rule amendments are proposed to satisfy procedural and substantive changes made to the Public Funds Investment Act Chapter 2256 of the Government Code by H.B. 2459 effective September 1, 1995. One minor change was made in sec.365.2 to the definition of "Authorized dealers" to add dealers authorized to do business with the Texas Water Resources Finance Authority. Section 365.1 is amended to be more specific about the scope of the chapter and to list specific funds for which the investment policy will apply. Definitional changes are made in sec.365.2 to reflect changes in the rules and eliminate definitions which are no longer needed. New sec.365.5 states the board's policy for investment of the board's and Texas Water Resources Finance Authority's portfolio in order of priority. Section 365.6 establishes a prudent person standard and explains considerations in determining whether prudence was followed in investments. Section 365.7 provides that the board's and authority's portfolio will be invested with the following objectives in order of priority: 1) presentation and safety of principal; 2) liquidity; and 3) yield/return on investments. This section also provides a strategy for investments by fund indicating types of securities that may be purchased and maximum security dates. Section 365.8 delegates the authority for investments to the investment officer, and requires such officer to establish a system of written controls approved by the board's Finance Committee. Section 365.9 establishes training requirements. Section 365.10 establishes provisions relating to ethics and conflicts of interest. Section 365.11 and sec.365.12 provide for selection of primary and secondary dealers with which the board will make investments and includes provisions relating to rotation of authorized dealers for investments, and methods for terminating investment activity with dealers. The section prohibits the use of the board's or authority's financial advisor to buy or sell securities. Section 365.13 specifies those investments which are suitable and which are prohibited for the portfolio. Section 365.14 provides for collateralization. Section 365.15 provides provisions for delivery, safekeeping, and custody. Section 365.16 provides for diversification. Section 365.17 provides for maximum maturities, including longer maturities for reserve components of funds. Section 365.18 provides for internal audit review of the investment functions annually and annual review of the investment policy by the board. Section 365.19 provides for performance standards. Section 365.20 provides for market yield and benchmarking against the six-month U.S. Treasury bill. Section 365.21 provides for a quarterly report on investment transaction by fund. The repeal of sec.sec.365.21-365.24, sec.sec.365.31-365.35, and sec.sec.365.51-365.54 are being proposed because the content of these sections is provided in the revised or proposed sections. No comments were received on the proposed sections. General Provisions 31 TAC sec.sec.365.1, 365.2, 365.5-365.10 The amendments and new sections are adopted under the authority of the Texas Water Code, sec.6.101, which provides the Texas Water Development Board with the authority to adopt rules necessary to carry out the powers and duties in the Water Code and other laws of the State, and the Texas Government Code, Chapters 2256 and 2257, which require each State agency to adopt rules necessary to invest funds and relating to collateral for securities. sec.365.2. Definitions. The following words and terms, when used in this subchapter shall have the following meanings, unless the context clearly indicates otherwise. Authorized dealers -those dealers who have been approved to do business with the board and authority. Dealer-A company which seeks to provide investments to the board or authority. Development fund manager-The director of the Development Fund Division or a designated representative. Investment officer -The Cash & Securities Manager of the Development Fund or any other person authorized by the board or executive administrator to invest funds of the board or authority. U.S. government agencies-The Federal Home Loan Bank, the Federal National Mortgage Association and the Government National Mortgage Association. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 16, 1996. TRD-9606855 Craig D. Pedersen Executive Administrator Texas Water Development Board Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 463-7981 Selection of Authorized Dealers 31 TAC sec.sec.365.11, 365.12, 365.13-365.20 The amendments and new sections are adopted under the authority of the Texas Water Code, sec.6.101, which provides the Texas Water Development Board with the authority to adopt rules necessary to carry out the powers and duties in the Water Code and other laws of the State, and the Texas Government Code, Chapters 2256 and 2257, which require each State agency to adopt rules necessary to invest funds and relating to collateral for securities. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 16, 1996. TRD-9606856 Craig D. Pedersen Executive Administrator Texas Water Development Board Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 463-7981 Investment Procedures 31 TAC sec.sec.365.21-365.24 The repeals are adopted under the authority of the Texas Water Code, sec.6. 101, which provides the Texas Water Development Board with the authority to adopt rules necessary to carry out the powers and duties in the Water Code and other laws of the State, and the Texas Government Code, Chapters 2256 and 2257, which require each State agency to adopt rules necessary to invest funds and relating to collateral for securities. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 16, 1996. TRD-9606857 Craig D. Pedersen Executive Administrator Texas Water Development Board Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 463-7981 31 TAC sec.365.21 The new section adopted under the authority of the Texas Water Code, sec.6. 101, which provides the Texas Water Development Board with the authority to adopt rules necessary to carry out the powers and duties in the Water Code and other laws of the State, and the Texas Government Code, Chapters 2256 and 2257, which require each State agency to adopt rules necessary to invest funds and relating to collateral for securities. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 16, 1996. TRD-9606858 Craig D. Pedersen Executive Administrator Texas Water Development Board Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 463-7981 Standards for Investments and Reporting of Investments 31 TAC sec.sec.365.31-365.35 The repeals are adopted under the authority of the Texas Water Code, sec.6. 101, which provides the Texas Water Development Board with the authority to adopt rules necessary to carry out the powers and duties in the Water Code and other laws of the State, and the Texas Government Code, Chapters 2256 and 2257, which require each State agency to adopt rules necessary to invest funds and relating to collateral for securities. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 16, 1996. TRD-9606859 Craig D. Pedersen Executive Administrator Texas Water Development Board Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 463-7981 Payment, Delivery, and Deposit of Investments 31 TAC sec.sec.365.51-365.54 The repeals are adopted under the authority of the Texas Water Code, sec.6. 101, which provides the Texas Water Development Board with the authority to adopt rules necessary to carry out the powers and duties in the Water Code and other laws of the State, and the Texas Government Code, Chapters 2256 and 2257, which require each State agency to adopt rules necessary to invest funds and relating to collateral for securities. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on May 16, 1996. TRD-9606860 Craig D. Pedersen Executive Administrator Texas Water Development Board Effective date: June 6, 1996 Proposal publication date: March 19, 1996 For further information, please call: (512) 463-7981 TITLE 37. PUBLIC SAFETY AND CORRECTIONS Part III. Texas Youth Commission Chapter 85. Admission and Placement Placement Planning 37 TAC sec.85.43 sec.85.45 The Texas Youth Commission (TYC) adopts an amendment to sec.85.43, concerning Interstate Compact for TYC youth; and new sec.85.45, concerning Interstate Compact for probationers, return of non delinquent runaways, absconders and escapees, without changes to the proposed text as published in the April 16, 1996, issue of the Texas Register (21 TexReg 3329). The justification for amending sec.85.43 and new sec.85.45 is to provide more efficient administration of Interstate Compact for TYC youth. The amendments to sec.85.43 include the addition of the new location of the Interstate Compact on Juveniles (ICJ) in the Texas Family Code, airport surveillance of TYC youth traveling unaccompanied, and other additions for process clarification. New sec.85.45 defines the process and procedures of the ICJ in requesting cooperative supervision from other states for probationers from other state; for the return of non-delinquent runaways, probation absconders, escapees, and juveniles being charged as delinquents; and detainment of the interstate runaways, absconders, and escapees. The processes for requesting airport surveillance and the duties of the transportation officers are outlined. This new rule incorporates rules and regulations as promulgated by the Association of Juvenile Compact Administrators, the rule-making authority for the ICJ. No comments were received regarding adoption of the amendment and new rule. The amendment and new rule are adopted under the Human Resources Code, sec.61.034, which provides the Texas Youth Commission with the authority to make rules appropriate to the proper accomplishment of its functions. The proposed rules implement the Human Resource Code, sec.61.034. This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas on May 17, 1996. TRD-9606903 Steve Robinson Executive Director Texas Youth Commission Effective date: June 10, 1996 Proposal publication date: April 16, 1996 For further information, please call: (512) 483-5244