PROPOSED RULES
Before an agency may permanently adopt a new or amended section or repeal an 
existing section, a proposal detailing the action must be published in the Texas 
Register at least 30 days before action is taken. The 30-day time period gives 
interested persons an opportunity to review and make oral or written comments on 
the section. Also, in the case of substantive action, a public hearing must be 
granted if requested by at least 25 persons, a governmental subdivision or 
agency, or an association having at least 25 members.
Symbology in proposed amendments. New language added to an existing section is 
indicated by the <nl> code. [Brackets] indicate deletion of existing material 
within a section.

TITLE 1. ADMINISTRATION
PART V. General Services Commission
CHAPTER 126. Surplus and Salvage Property Programs
SUBCHAPTER A. State Surplus and Salvage Property
1 TAC sec.126.3
The General Services Commission propose an amendment to sec.126.3, concerning 
the Disposition of Surplus and Salvage Property to the public. The amendments 
will reflect statutory intent and allow expeditious implementation of the 
revised purchaser fee after its annual review.
Dan Bremer, Director of the Surplus Property Program, has determined that for 
the first five-year period the amendments to sec.126.3 are in effect there will 
be no fiscal implications for state or local government as a result of 
implementing these amendments. 
Dan Bremer, Director of the Surplus Property Program, has also determined for 
each year of the first five years the amended sections are in effect, the public 
benefit anticipated as a result of enforcing the rule is that the Commission 
will be able to implement the revised purchaser fee after its annual review 
without amending the rules each year thereby serving the best interests of the 
Texas taxpayer. There will be no cost to small or large businesses and/or 
individuals. 
Comments on the proposed amendment may be submitted to Judy Ponder, General 
Counsel, General Services Commission, P. O. Box 13047, Austin, Texas 78711-3047. 
Comments must be received no later than 30 days from the date of publication of 
the proposal in the Texas Register.
The amended section is proposed under the Texas Government Code, Title 10, 
Subtitle D, Chapter 2175, sec.2175.181 and sec.2175.182 which provides the 
General Services Commission with the authority to promulgate rules necessary to 
implement the sections.
The following statute is affected by this amendment: Texas Government Code, 
Title 10, Subtitle D, Chapter 2175, sec.2175.181 and sec.2175.182. 

sec.126.3. Disposition of Surplus and Salvage Property to the Public. 
(a) (No change.) 
(b) Mailing list of bidders. The commission will maintain a mailing list of 
companies or individuals who have applied to bid on surplus or salvage property. 
[The commission may change an annual subscription fee to recover the costs 
associated with maintaining and using the bidders list.] Names may be deleted 
from the mailing list for: failure to bid, failure to make payment, <nl>or<ol> 
failure to remove awarded items[, or failure to renew the annual subscription 
fee]. A bidder who has been removed from the bidders list for failure to pay for 
or remove surplus property many not be reinstated until a written request has 
been presented to and approved by the Program Administrator of the Surplus 
Property Programs.
(c) Purchaser Fee. The commission or the agency shall assess and collect from 
the purchaser a [2.5%] fee over and above the proceeds from the sale of the 
property to recover the costs associated with the sale of the property. <nl>The 
fee shall be reviewed annually and shall be at least two percent but not more 
than 12% of sale proceeds.<ol> 
(d)-(j) (No change.) 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt. 
Filed with the Office of the Secretary of State on May 28, 1998.
TRD-9808686
Judy Ponder
General Counsel
General Services Commission
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 463-3960

TITLE 4. AGRICULTURE
PART I. Texas Department of Agriculture
CHAPTER 17. Marketing and Development Division
SUBCHAPTER C. TAP, Taste of Texas, Vintage Texas, Texas Grown, and Naturally 
Texas Promotional Mark
4 TAC sec.sec.17.51, 17.52, 17.54
The Texas Department of Agriculture (the department) proposes amendments to 
sec.sec.17.51, 17.52, and 17.54, concerning the department's marketing programs 
promoting Texas agricultural products. The department proposes the amendments to 
clarify the qualifications for membership in the programs. 
Matt Brockman, Assistant Commissioner for Marketing and Agribusiness 
Development, has determined that for the first five- year period the proposal is 
in effect there will be no fiscal implications for state or local government as 
a result of enforcing or administering the proposal. 
Mr. Brockman also has determined that for each of the first five years the 
proposal is in effect the expected public benefit derived from enforcement and 
administration of the proposal will be a clearer understanding of the requisite 
qualifications necessary for participation in the department's marketing 
programs. There will be no effect on small or large businesses. There is no 
anticipated economic cost to persons who are required to comply with the 
proposal. 
Comments on the proposal may be submitted to Matt Brockman, Assistant 
Commissioner for Marketing and Agribusiness Development, Texas Department of 
Agriculture, P.O. Box 12847, Austin, Texas, 78711. Comments must be received no 
later than 30 days from the date of publication of the proposal in the Texas 
Register. 
The amendments are proposed under the Texas Agriculture Code sec.12.016, which 
provides that the department may adopt rules as necessary for the administration 
of its powers and duties under the Texas Agriculture Code; and sec.12.017, which 
authorizes the department to regulate the use of the term "Texas Agricultural 
Product" by rule.
The Code affected by this proposal is the Texas Agriculture Code, Chapter 12. 

sec.17.51. Definitions. 
The following words and terms, when used in these sections, shall have the 
following meanings, unless the context clearly indicates otherwise. 
<nl>(1)<ol> Commissioner--Commissioner of agriculture, Texas Department of 
Agriculture. 
<nl>(2)<ol> Department--The Texas Department of Agriculture.
<nl>(3)<ol> Natural fibers--Fibers which have been produced from crops or shorn 
from livestock, and which are used in textiles, apparel, and other goods. The 
term "natural fibers" also includes leather made from the hides of animals. 
<nl>(4)<ol> Naturally Texas mark--A mark bearing the icons (or symbols) 
representative of leather, wool, mohair, and cotton and bearing the words 
"Naturally TEXAS[.]" <nl>, such<ol> [Such] mark being <nl>a certification 
mark<ol> registered with the <nl> United States Patent and Trademark Office, and 
also being registered with the<ol> Secretary of State's office by the 
department. 
Figure: 4 TAC sec.17.51(4) 
<nl>(5)<ol> Person--An individual, firm, partnership, corporation, governmental 
entity, or association of individuals. 
<nl>(6)<ol> Processed--Having undergone a value-added procedure to change or add 
to the physical characteristics of an agricultural product. For purposes of 
these sections, the department shall have sole discretion in determining whether 
a product qualifies as being processed. 
<nl>(7)<ol> Produced in Texas--A product is produced in Texas if: 
(A) the commodity or commodities of which it is composed are grown, raised, 
nurtured, sown, or cultivated within the state; or 
(B) the product is processed within the state in a manner which substantially 
changes its form. 
<nl>(8)<ol> Producer--Any person who produces products grown in the State of 
Texas or made from ingredients grown in the State of Texas. 
<nl>(9)<ol> TAP mark--The term "Texas Agricultural Product" or the following 
mark embracing the same, such mark being registered with the secretary of 
state's office by the department. 
Figure: 4 TAC sec.17.51(9) 
<nl>(10)<ol> Taste of Texas mark--A flag-shaped mark bearing the words "Taste of 
Texas," so colored as to [closely] model <nl>closely<ol> the flag of the State 
of Texas, such mark being registered with the secretary of state's office by the 
department. 
Figure: 4 TAC sec.17.51(10) 
<nl>(11)<ol> Texas Grown mark--A vertical and rectangular mark which features a 
native Texas mountain laurel branch in bloom over an outline of the state of 
Texas with the word "Texas" at the top and the word "Grown" at the bottom of the 
rectangle<nl>, such mark being registered with the secretary of state's office 
by the department<ol>.
Figure: 4 TAC sec.17.51(11) 
<nl>(12)<ol> Vintage Texas mark--A vertical, rectangular mark consisting of a 
cluster of six grapes loosely forming a triangle and topped by a single grape 
leaf, all centered in the middle of a five-pointed star. Coming from behind the 
top center point of the star is a short curlicue line representing a grapevine. 
One horizontal line intersects with the tip of the center point of the star, and 
a parallel horizontal line intersects the two bottom points of the star. The 
word "VINTAGE" appears above the top parallel line, and the word "TEXAS" appears 
below the bottom parallel line<nl>, such mark being registered with the 
secretary of state's office by the department<ol>. 
Figure: 4 TAC sec.17.51(12) 

sec.17.52. Application for Registration To Use the TAP, Taste of Texas, Vintage 
Texas, Texas Grown, or Naturally Texas Promotional Mark. 
(a) (No change.) 
(b) Unless permission is otherwise granted by the department:
(1) (No change.) 
(2) the Taste of Texas promotional mark may only be utilized by Taste of Texas 
program members. The Taste of Texas program is a program established by the 
department to promote <nl>the retail sale and wholesale of <ol>agricultural food 
products processed in Texas, regardless of origin, and unprocessed agricultural 
food products grown in Texas. <nl>A food service company, including a 
restaurant, is not eligible for membership unless it processes a packaged 
product for resale<ol>; 
(3)-(5) (No change.) 
(c)-(n) (No change.) 

sec.17.54. Denial of Application to use the TAP, Taste of Texas, Vintage Texas, 
Texas Grown, or Naturally Texas Promotional Mark. 
An application for registration to use the TAP, Taste of Texas, Vintage Texas, 
Texas Grown, or Naturally Texas promotional mark may be denied if:
(1)-(2) (No change.)
(3) the product is of a quality markedly inferior to that representative of 
similar products produced in Texas; [or]
(4) the applicant has misused the TAP, Taste of Texas, Vintage Texas, Texas 
Grown, or Naturally Texas promotional mark prior to the date of application<nl>; 
or<ol>
<nl>(5)<ol> for reasons of policy, as determined by the department. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State on May 29, 1998.
TRD-9808743
Dolores Alvarado Hibbs
Deputy General Counsel
Texas Department of Agriculture
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 463-7541

CHAPTER 20. Cotton Pest Control
SUBCHAPTER C. Stalk Destruction Program
4 TAC sec.20.22
The Texas Department of Agriculture (the department) proposes amendments to 
sec.20.22, concerning authorized cotton stalk destruction dates for Pest 
Management Zone 2, Areas 1 and 2. The department is amending its cotton stalk 
destruction schedule to require farmers in zone 2 areas 1 and 2 to destroy 
cotton stalks by September 15 of each year. The department is acting on behalf 
of cotton farmers in Zone 2 Area 1, which includes Duval and Webb counties, and 
Zone 2 Area 2, which includes Jim Wells, Kleberg, Nueces, and the northern 
portion of Kenedy County encompassing the area above an east-west line through 
Katherine and Armstrong, Texas. The current destruction date for zone 2 area 1 
is September 10; the current destruction date for zone 2 area 2 is September 20. 
The department believes that changing the cotton destruction dates is both 
necessary and appropriate because having a standard destruction deadline for 
these areas will allow for a more uniform and efficient enforcement program. 
Terry Mitchell, coordinator for pest management programs, has determined that 
for the first five-year period the rule is in effect there will be no fiscal 
implications for state or local government as a result of enforcing or 
administering the rule. 
Mr. Mitchell also has determined that for each year of the first five years the 
rule is in effect the public benefit anticipated as a result of enforcing the 
rule will be the reduction in boll weevils and their habitat and the 
facilitation of effective cotton pest control. There will be no effect on small 
businesses. There will be no anticipated economic cost to persons who are 
required to comply with the rule as proposed. 
Comments on the proposal may be submitted to Terry Mitchell, Coordinator for 
Pest Management Programs, Texas Department of Agriculture, P. O. Box 12847, 
Austin, Texas 78711. Comments must be received no later than 30 days from the 
date of publication of the proposal in the Texas Register. 
The amendment is proposed under the Texas Agriculture Code, sec.74.006, which 
provides the Texas Department of Agriculture with the authority to adopt rules 
as necessary for the efficient enforcement and administration of Chapter 74, 
Subchapter A; and sec.74.004, which provides the department with the authority 
to establish regulated areas, dates, and appropriate methods of destruction of 
stalks, other parts, and products of host plants for cotton pests. 
The code sections that will be affected by the proposal are the Texas 
Agriculture Code, Chapter 74, Subchapter A. 

sec.20.22. Stalk Destruction Requirements.
(a) Deadlines and methods. All cotton plants in a pest management zone shall be 
destroyed, regardless of the method used, by the stalk destruction dates 
indicated for the zone. Destruction shall be accomplished by the methods 
described as follows: 
Figure: 4 TAC sec.20.22(a) 
(b)-(c) (No change.) 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt. 
Filed with the Office of the Secretary of State on June 1, 1998.
TRD-9808810
Dolores Alvarado Hibbs
Deputy General Counsel
Texas Department of Agriculture
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 463-7541

TITLE 7. BANKING AND SECURITIES
PART VI. Credit Union Department
CHAPTER 91. Chartering, Operations, Mergers, Liquidations 
SUBCHAPTER G. Loans
7 TAC sec.91.701
The Texas Credit Union Commission proposes an amendment to sec.91.701, 
concerning loans and extensions of credit that a credit union may make. The 
amendments are being proposed to: 1) add language addressing the treatment of 
extension agreements or payment deferrals in determining compliance with loan 
maturity maximums; 2) give the board of directors the ability to waive title 
insurance requirements when the loan-to-value ratio is less than 50%; 3) allow 
credit unions the option of using state licensed appraisers; 4) exempt certain 
home equity loans from the underwriting requirements contained in sec.91.701; 5) 
set limitations on the percentage of loans that can be real estate secured, with 
exceptions for credit unions over a specified asset size based on the types of 
loans being originated; 6) further clarify the minimum contents of loan 
policies; and 7) grant the commissioner the authority to limit a credit union's 
lending activity if examination results find that the credit union is conducting 
business in an unauthorized or unsafe manner. The amendments also reduce 
confusion when reading the rule by restructuring the numbering format of the 
rule. 
Lynette Pool-Harris, Deputy Commissioner, has determined that there will be no 
fiscal implications for state or local government as a result of enforcing or 
administering the proposed amended section. 
Ms. Pool-Harris has also determined that for each year of the first five years 
the amended section, as proposed, is in effect, the public benefit anticipated 
as a result of enforcing the rule will be a greater flexibility in originating 
loans provided certain safety and soundness concerns are addressed, 
clarification of confusing language, and greater readability. There will be no 
effect on small businesses as a result of enforcing this section as amended. 
There is no economic cost anticipated to the entities that are required to 
comply with the section as proposed. 
Written comments on the proposed amendment must be submitted within 30 days 
after their publication in the Texas Register to Carol P. Shaner, Staff Services 
Officer, Credit Union Department, 914 East Anderson Lane, Austin, Texas 78752-
1699.
The amendment is proposed under the provision of the Texas Finance Code, 
sec.124.001, which provides the Credit Union Commission with the authority to 
adopt rules governing loans made to credit union members; and under the Texas 
Finance Code, sec.15.402, which authorizes the commission to adopt reasonable 
rules for administering Title 2, Chapter 15 and Title 3, Subchapter D of the 
Texas Finance Code. 
The specific section affected by the proposed amendment is Texas Finance Code, 
sec.124.001. 

sec.91.701. Loans. 
(a) General. A credit union may make loans and extend credit in accordance with 
[the Act, these Rules, and other] applicable [law] <nl>laws, rules and 
regulations, the provisions contained in its bylaws, and any further conditions 
imposed by loan policies adopted by the board of directors.<ol> 
<nl>(b)<ol> Determination of Maximum Maturity. When an extension agreement or 
deferral of payments on a loan is properly approved subsequent to and unrelated 
to the execution of the loan, the period of time attributable to the extension 
or deferral shall not be considered in determining compliance with any 
prescribed maximum maturity requirement.
<nl>(c)<ol> [(b)] Loans not secured by real estate. The maturity of a loan not 
secured by a lien on real estate may not, at the time the loan is executed, 
exceed 15 years unless: 
(1) the purpose of the loan is to finance the purchase of a manufactured home 
and the loan is secured by a first lien, in which case the maturity may not 
exceed 20 years; 
(2) the loan is at least 90% insured or guaranteed as to both principal and 
interest by the State of Texas or the United States or any agency or 
instrumentality thereof; or 
(3) the commissioner has approved, in writing, and prior to the making of a loan 
or class of loans, a greater maturity for that loan or class of loans. 
<nl>(d)<ol> [(c)] Loans secured by real estate. For loans secured, in whole or 
in part, by a lien on real estate, the requirements described in this 
<nl>section<ol> [subsection] shall apply unless waived in writing by the 
commissioner.[:] 
<nl>(e)<ol> [(1)] Loans secured by a first lien on real estate. A loan, or any 
refinancing thereof, secured by a first lien on real estate shall be subject to 
the requirements described in this subsection [paragraph] as applicable. 
<nl>(1)<ol> [(A)] Maximum Maturity; Loan to Value ratio. 
<nl>(A)<ol> [(i)] A loan secured by a lien on improved residential real estate 
occupied by the owner shall have, at the time the loan is executed, a maximum 
maturity of 40 years and a loan to value ratio not greater than 95%; 
<nl>(B)<ol> [(ii)] A loan secured by a lien on improved real estate not to be 
occupied by the owner shall have, at the time the loan is executed, a maximum 
maturity of 30 years and a loan to value ratio not greater than 80%; 
<nl>(C)<ol> [(iii)] An interim construction loan shall have, at the time the 
loan is executed, a maximum maturity of 18 months and the amount of the loan 
shall not exceed 90% of the projected appraised value at completion or the 
estimated cost of construction, whichever is less; 
<nl>(D)<ol> [(iv)] Any other loan not described in <nl>subparagraphs<ol> 
[clauses] <nl>(A), (B), or (C)<ol> [(i), (ii), or (iii)] of this paragraph shall 
have, at the time the loan is executed, a maximum maturity of 20 years and a 
loan to value ratio not greater than 80%. 
<nl>(2)<ol> [(B)] Escrow; pledged accounts. A loan, other than an interim 
construction loan, shall have as a requirement in its terms and conditions that 
the borrower must pay, in addition to principal and interest, an amount to be 
deposited to an escrow account, or otherwise applied as provided in the credit 
union's loan policies, for estimated annual taxes, assessments, insurance 
premiums, and other charges upon the real estate securing the loan. The 
additional payment may be waived if an amount equal to at least the estimated 
annual insurance premium and annual taxes is pledged to and maintained at the 
credit union during the term of the loan, the loan is not in arrears or 
delinquent at any time, and the credit union is furnished with evidence of 
payment of taxes and insurance each year<nl>;<ol> [,] or the loan to value ratio 
is maintained at 70% or less at all times. 
<nl>(3)<ol> [(C)] Title opinion; Title insurance. A loan may not be made by the 
credit union unless it is furnished with either a written title opinion of an 
attorney or a satisfactory policy of title insurance in the principal amount of 
the loan, which policy shall be issued by a title company authorized to insure 
titles in this state, insuring that the lien is a first and prior lien. The 
validity of title for loans for less than $25,000 <nl>or with a loan to value 
ratio less than 50% <ol>may be determined as prescribed by board policy. 
<nl>(4)<ol> [(D)] Private Mortgage Insurance or United States Government 
Guaranteed Loans. Unless a real estate loan is insured by an agency of the 
United States Government or by a private mortgage insurance company, the maximum 
loan amount is 90% of the purchase price or appraised value of the property, 
whichever is less. 
<nl>(5)<ol> [(E)] Property insurance. Any loan secured by a lien on improved 
real estate must require in its terms and conditions that fire and extended 
coverage be maintained in an amount not less than the loan balance (plus any 
amount secured by prior liens) or the replacement value of improvements, 
whichever is less, and that the credit union be named as loss payee. 
<nl>(6)<ol> [(F)] Recording instruments. Every mortgage, deed of trust, or other 
instrument creating, constituting, or transferring a lien securing a loan shall 
be properly and timely recorded in the appropriate deed records. 
<nl>(7)<ol> [(G)] Valuation. Every loan must have included in its documentation 
evidence of the market value of the real estate determined in accordance with 
written board policy or, if the amount of the loan exceeds $100,000, a report of 
an appraisal prepared by <nl>a state licensed appraiser or by<ol> a state 
certified appraiser <nl> if required by the Financial Institutions Reform, 
Recovery and Enforcement Act of 1989<ol>. 
<nl>(f)<ol> [(2)] Other real estate loans [;Maximum maturity; Loan to value 
ratio]. A loan, or any refinancing thereof, secured by a lien on real estate 
other than a first lien[:] <nl> shall be subject to the requirements described 
in this subsection as applicable <ol>. 
<nl>(1)<ol> <nl>Maximum maturity; loan to value ratio. <ol> 
(A) <nl>A loan secured by a lien on real estate other than a first lien<ol> 
which is not an interim construction loan, shall have, at the time the loan is 
executed<nl>,<ol> a maximum maturity of 20 years and, if occupied by the owner 
or will be so occupied, a loan to value ratio not greater than 90%, or in any 
other case 80%; except that property improvement loan to value ratios may be 
based upon the projected appraised value at completion<nl>.<ol> [ ; or] 
(B) <nl>A loan secured by a lien on real estate other than a first lien<ol> 
which is an interim construction loan, shall have, at the time the loan is 
executed, a maximum maturity of 18 months and the aggregate amount of the loan 
and other existing loan balances secured by the property shall not exceed 80% of 
the projected appraisal value at completion or the estimated cost of 
construction, whichever is less.
<nl>(2)<ol> [(C)] Property insurance. Any loan secured by a lien on improved 
real estate must require in its terms and conditions that fire and extended 
coverage be maintained in an amount not less than the loan balance (plus any 
amount secured by prior liens) or the replacement value of improvements, 
whichever is less, and that the credit union be named as loss payee. 
<nl>(3)<ol> [(D)] Recording instruments. Every mortgage, deed of trust, or other 
instrument creating, constituting, or transferring a lien securing a loan shall 
be properly and timely recorded in the appropriate deed records, except for 
those instances when recording is not required under an applicable state or 
federal guaranty program. 
<nl>(4)<ol> [(E)] Title opinion; Title insurance. A loan may not be made by the 
credit union unless it is furnished with either a written title opinion of an 
attorney or a satisfactory policy of title insurance in the principal amount of 
the loan, which policy shall be issued by a title company authorized to insure 
titles in this state. The validity of title for loans of less than $25,000 
<nl>or with a loan to value ratio of less than 50%<ol> may be determined as 
prescribed by board policy.
<nl>(5)<ol> [(F)] Valuation. Every loan must have included in its documentation 
evidence of the market value of the real estate determined in accordance with 
written board policy or, if the amount of the loan exceeds $100,000, a report of 
an appraisal prepared by <nl> a state licensed appraiser or by<ol> a state 
certified appraiser <nl> if required by the Financial Institutions Reform, 
Recovery and Enforcement Act of 1989<ol>. 
<nl>(g)<ol> [3] Home improvement loans. Loans in which the proceeds are used to 
construct new improvements or renovate existing improvements on a homestead 
property must also comply with the requirements of sec.50(a)(5), Article XVI, 
Texas Constitution. 
<nl>(h)<ol> [4] Loans originated under sec.50(a)(6), Article XVI, Texas 
Constitution. For a loan secured by an encumbrance against the equity in a 
homestead property, the terms and conditions set forth in sec.50, Article XVI, 
Texas Constitution, will take precedence over any specific requirement contained 
in this section if there is an irreconcilable conflict between a constitutional 
provision and the provision of this section. <nl> Subject to compliance with the 
board's written equity loan policies, loans of $25,000 or less, or loans less 
than 20% of the regular reserve, whichever amount is lesser, are exempt from the 
underwriting requirements of this section. <ol> 
<nl>(i)<ol> [5] Reverse mortgages. A credit union may offer reverse mortgages to 
its members under the terms and conditions set forth in Section 50, Article XVI, 
Texas Constitution. In the event of an irreconcilable conflict between any 
specific requirement contained in this section and a constitutional provision, 
the constitutional requirement shall prevail. 
<nl>(j)<ol> Limitations on loans secured by real estate. The total of loans 
outstanding which are secured by liens on real property shall not exceed 25% of 
the total of all of the credit union's outstanding loans and advances. However, 
a credit union that has gross assets of $20,000,000 or more and a written 
asset/liability management plan or policy that specifically addresses real 
estate lending may exclude from this 25% limitation the following loans: 
<nl>(1)<ol> Any loans meeting the standards of the federal national mortgage 
association or federal home loan mortgage corporation.
<nl>(2)<ol> Any loan saleable in the secondary market as evidenced by 
commitments to buy by a buyer in the secondary market. 
<nl>(3)<ol> Any loans which contain provisions to adjust the amount of each 
payment, the number of monthly payments, or both, as is necessary because of 
changes in the interest rate charged, and which are secured by a mortgage or 
deed of trust on real property which has or will have not more than four 
residential units. 
<nl>(4)<ol> Any loans which are secured by non-residential real estate. 
<nl>(k)<ol> [(d)] Prohibited activity. A credit union shall not make a loan or 
extend credit if any commission, fee, or compensation of any type from any 
person or entity other than the credit union is to be received by any credit 
union official or employee, or an immediate family member of either, in 
connection with underwriting, insuring, procuring, servicing, or collecting the 
loan or extension of credit. 
<nl>(l)<ol> [(e)] Indirect Financing. A credit union shall provide written 
notice to the commissioner at least 30 days prior to implementing a program of 
indirect financing of motor vehicles or other chattels. 
<nl>(m)<ol> [(f)] Loan policies. The board of directors shall establish, 
implement, and maintain prudent and reasonable written loan policies that 
specify guidelines and criteria to be used in making loans and extending credit 
consistent with this rule. <nl>These policies shall take into consideration the 
needs of the borrower as well as the safety and soundness of the credit union 
and will address at a minimum the following: <ol> 
<nl>(1)<ol> Loan limits for each type or class of loan. 
<nl>(2)<ol> Loan application requirements. The loan application must contain 
sufficient information to allow the credit union to carefully analyze the 
character and financial condition of each loan applicant and, if required, the 
comaker or guarantor to ascertain their ability to repay based on the maximum 
maturity, terms of payment and amortization periods on all types of loans. 
<nl>(3)<ol> Collateral requirements.
<nl>(4)<ol> Real estate and equity loan guidelines will include, at a minimum, 
requirements pertaining to appraisals, escrow, title insurance, and hazard 
insurance. 
<nl>(5)<ol> Limitations on the lending authority delegated to the credit 
committee, other committees, or loan officers.
<nl>(n)<ol> Discretionary authority retained by commissioner. The commissioner 
may limit, restrict or prohibit a credit union from making any type, category, 
or classification of loan governed by this section if examination results 
indicated the credit union is conducting its business in an unauthorized or 
unsafe manner or is violating the provisions of this chapter. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt. 
Filed with the Office of the Secretary of State on May 27, 1998.
TRD-9808589
Harold E. Feeney
Commissioner
Credit Union Department
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 837-9236

TITLE 13. CULTURAL RESOURCES
PART V. Texas State Cemetery Committee
CHAPTER 71.Texas State Cemetery 
13 TAC sec.sec.71.1, 71.3, 71.11, 71.13, 71.15, 71.17, 71.19, 71.21 
The Texas State Cemetery Committee proposes new sec.sec.71.1, 71.3, 71.11, 
71.13, 71.15, 71.17, 71.19, and 71.21 under Title 13, Texas Administrative Code, 
Part V, Chapter 71, concerning the Texas State Cemetery Committee. The new rules 
are proposed to carry out legislative mandate under SB 973, 75th Legislative 
Session, located under the Texas Government Code, sec.2165.256 and 
sec.2165.2561. 
Harry Bradley, Superintendent, Texas State Cemetery, has determined that for the 
first five-year period the rules are in effect there will be no fiscal 
implication for state or local governments as a result of enforcing of 
administering the rules. 
Mr. Harry Bradley, Superintendent, Texas State Cemetery, also has determined 
that for each of the first five years the new rules are in effect, the public 
benefit will be the established policies and procedures for the Texas State 
Cemetery There is no anticipated economic cost to persons required to comply 
with the new rules as proposed. There will be no impact on small business.
Comments on the proposals may be submitted to Ann Dillon, Legal Counsel, Texas 
State Cemetery Committee, P. O. Box 13047, Austin, TX. 78711-3047. Comments must 
be received no later than 30 days from the date of publication of the proposal 
to the Texas Register.
Title 13, Texas Administrative Code, Part V, Chapter 71, is proposed under the 
authority of Texas Government Code, Title 10, Subtitle D, sec.2165.2561. The 
following statutes or codes are effected by these new rules: Texas Government 
Code, Title 10, Subtitle D, sec.2165.256 and sec.2165.2561.

sec.71.1.Organization.
(a) The Texas State Cemetery Committee is composed of three voting members 
appointed by the governor and three nonvoting advisory members representing the 
Texas Historical Commission, the General Services Commission, and the Texas 
Parks and Wildlife Department. 
(b) All decisions of the Committee shall be by majority vote of the three voting 
members present and voting. 

sec.71.3.Definitions.
The following works and terms, when used in this title, shall have the following 
meanings unless the context clearly indicates otherwise: 
(1) Columbarium Wall - the wall of niches, divided into separate East and West 
sections, reserved for a person's cremains. 
(2) Cremains - that which is left after incineration of a person after death. 
(3) Epitaph - the inscription which identifies the gravesite and memorializes a 
person on a monument, headstone or niche plate. 
(4) General Services Commission - the funding agency for the State Cemetery. 
Cemetery employees are General Services Commission personnel. One of four 
agencies, which through inter-agency contracts, participated in the Restoration 
and Enhancement of the State Cemetery. 
(5) Headstone - a permanent stone placed on a grave to identify the interred 
remains. 
(6) Interment - the burial of a person's remains or cremains within a cemetery. 
(7) Interred - to put into a grave; buried. 
(8) Marker - a monument, headstone, tablet, memorial, columbarium, urn, niche, 
niche panel; or any other structure intended to commemorate the deceased. 
(9) Monument - any memorial of granite, marble or other approved material which 
is intended to commemorate the interred within the space. 
(10) Remains - that which is left of a person after death; a corpse. 
(11) State Cemetery - the burial grounds for those individuals who are eligible 
under Section 2165.256(d)(e). An historical site of Texas established in 1851. 
(12) State Cemetery Annex - the property located at Bull Creek Road and 45th 
Street, currently owned by Texas Department of Transportation. The area totals 
approximately 45 acres. 
(13) State Cemetery Committee - a committee charged with operations of and 
jurisdiction over the Cemetery. Members consist of three voting gubernatorial 
appointees serving staggered terms and three non-voting advisory members, one 
each from General Services Commission, Texas Parks and Wildlife, and Texas 
Historical Commission. 
(14) Texas Department of Transportation - one of four agencies, which through 
inter-agency contracts, participated in the Enhancement and Restoration of the 
State Cemetery. 
(15) Texas Historical Commission - one of four agencies, which through inter-
agency contracts, participated in the Enhancement and Restoration of the State 
Cemetery. 
(16) Texas Parks and Wildlife Department - one of four agencies, which through 
inter-agency contracts, participated in the Enhancement and Restoration of the 
State Cemetery. 

sec.71.11.Monuments.
(a) Monuments and headstones are subject to the approval and regulation of the 
State Cemetery Committee. 
(b) Monument designs shall be submitted to the State Cemetery Superintendent for 
review and compliance with the regulations set forth by the State Cemetery 
Committee. 
(c) The Committee specifically reserves the right to reject and prohibit the 
erection of a monument or headstone, if, in the opinion of the Committee, the 
said monument or headstone is of inferior quality or craftsmanship, or if it 
does not comply with the following approved specifications: 
(1) Only selected natural stone from established quarries, or bronze meeting the 
specifications of the United States Bureau of Standards should be used for 
monuments or headstones. In all cases, craftsmanship should be of superior 
quality. 
(2) Curbs, fences, borders or enclosures around any burial spaces must be 
approved by the State Cemetery Committee. 
(3) Inscriptions on any monument or headstone shall be in keeping with the 
respect and dignity for the interred and for the State Cemetery as a place to 
honor and memorialize noteworthy Texans. 
(4) Temporary markers of wood, or cement are prohibited. Temporary metal markers 
provided by funeral homes are permitted until replaced by a permanent monument. 
(5) Monuments or headstones shall be constructed within the following 
dimensional specifications: 
(A) Maximum height: 7 feet 
(B) Maximum depth: 7 feet 
(C) Maximum width: 80 inches 
(6) Headstones and markers are the property of the State. 

sec.71.13.Vaults and Graveliners. 
The use of metal, asphalt, concrete, and other types of below ground burial 
vaults or graveliners purchased at private expense in the Texas State Cemetery 
is required. Neither the Superintendent nor any Cemetery employee shall be 
involved in making these arrangements. 

sec.71.15.Landscaping.
(a) A tree, shrub, plant or flower may not be removed, relocated or planted in 
the Cemetery without the permission of the Texas State Cemetery Committee. 
(b) The Superintendent shall oversee the removal, relocation or planting of 
trees, shrubs, plants and flowers within the State Cemetery grounds. The State 
Cemetery Committee may authorize the Superintendent to carry out landscape 
programs at his discretion and report to the Committee in a timely manner. 
(c) A digital map exhibiting the location of all existing vegetation shall be 
maintained by the State Cemetery. 
(d) Fresh cut flowers may be placed on the graves throughout the year. Floral 
items, fresh and artificial, will be removed from graves as soon as they become 
faded and unsightly. All artificial flowers or items removed from graves will be 
disposed of immediately. 
(e) Floral items and other types of decorations or commemorative items are not 
to be secured or affixed by any means (wire, tape, string or adhesives) to the 
monuments. 
(f) Planting of trees or shrubs is not permitted on or near the graves at any 
time, unless approved by the Texas State Cemetery Committee.
(g) Christmas wreaths, arrangements or floral grave blankets are permitted on 
graves during the season, beginning December 1st and will be removed no later 
than January 15th. Grave floral blankets may not be larger in size than two by 
three feet. Christmas trees are not permitted. Christmas decorations are not 
permitted on any living tree in the Cemetery or at the Plaza de Los Recuerdos or 
on any statue. 
(h) The Texas State Cemetery is not responsible for any items left on the 
graves. Permanent in-ground flower containers are authorized for placement with 
approval from the Superintendent. Existing containers may remain on graves until 
they become unserviceable. 

sec.71.17.Designation of Special Burial Areas.
(a) Hilltop - Both sides of the walking path leading to the lookout at the 
highest point of the Hilltop is designated as an area for cenotaph placement. 
(1) All cenotaphs are subject to the approval and regulation of the Texas State 
Cemetery Committee. 
(2) The west base of the Hilltop east of Highway 165 is designated as an area 
for burial niches for cremains. 
(b) Confederate Field - All sections of Confederate Field are set aside for the 
burial and reinterment of military heroes and notable military soldiers and 
officers. All burials and reinterments are subject to the approval and 
regulation of the State Cemetery Committee. 
(c) The Meadows - The Meadows consists of numerous notable Texans, elected state 
officials, judges, and commission and board members. The area is designated for 
individuals qualified for burial spaces. 
(d) Republic Hill - The Republic Hill area consists of many Texas heroes, 
soldiers, authors, and elected state officials. Republic Hill, Section 1 and 
Section 2 are closed to future applications. 
(e) The Crescent Pond - The area where Louis Kemp, the first Father of the State 
Cemetery, is buried is designated for those individuals qualified for burial 
spaces. 
(f) Columbarium Wall - The area designated for the cremains of qualified and 
approved individuals.

sec.71.19.Additional Cemetery Annex. 
(a) Upon reservation and closure of all burial spaces within the State Cemetery, 
the acquisition of adjacent land shall be evaluated by the State Cemetery 
Committee. 
(b) The Cemetery Annex is the property located at Bull Creek Road and 45th 
Street, currently owned by Texas Department of Transportation. The area totals 
approximately 45 acres. 

sec.71.21.Burial Reservations.
(a) The State Cemetery Committee shall actively pursue burial reservations from 
eligible persons. 
(b) The committee shall delegate to the Superintendent or a designated 
representative, the authority to research persons eligible for burial at the 
State Cemetery. 
(c) Biographical information, documentation, photos, newspaper articles and 
other supporting material shall be collected for review by the Committee. 
(d) The Committee shall review and consider those persons recommended by the 
Superintendent for eligibility for burial spaces during an Open Meeting. 
(e) The Committee shall encourage members of the legislature to advise 
constituents who are eligible for burial in the State Cemetery. The Committee 
may elect to advise members of the legislature by formal written communication. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt. 
Filed with the Office of the Secretary of State, on May 29, 1998.
TRD-9808728
Ann Dillon
General Counsel
Texas State Cemetery Committee
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 463-3960

TITLE 16. ECONOMIC REGULATION
PART II. Public Utility Commission of Texas
CHAPTER 23. Substantive Rules
SUBCHAPTER E. Customer Service and Protection
16 TAC sec.23.48
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Public Utility 
Commission of Texas or in the Texas Register office, Room 245, James Earl Rudder 
Building, 1019 Brazos Street, Austin.)
The Public Utility Commission of Texas (PUC) proposes the repeal of sec.23.48, 
relating to Continuity of Service. Project Number 19198 has been assigned to 
this proceeding. The Appropriations Act of 1997, HB 1, Article IX, Section 167 
(Section 167) requires that each state agency review and consider for readoption 
each rule adopted by that agency pursuant to the Government Code, Chapter 2001 
(Administrative Procedure Act). Such reviews shall include, at a minimum, an 
assessment by the agency as to whether the reason for adopting or readopting the 
rule continues to exist. The PUC held three workshops to conduct a preliminary 
review of its rules. As a result of these workshops, the PUC is reorganizing its 
current substantive rules located in 16 Texas Administrative Code (TAC) Chapter 
23 to (1) satisfy the requirements of Section 167; (2) repeal rules no longer 
needed; (3) update existing rules to reflect changes in the industries regulated 
by the commission; (4) do clean-up amendments made necessary by changes in law 
and commission organizational structure and practices; (5) reorganize rules into 
new chapters to facilitate future amendments and provide room for expansion; and 
(6) reorganize the rules according to the industry to which they apply. As a 
result of this reorganization, sec.23.48 will be duplicative of proposed new 
sec.25.52 of this title (relating to Continuity of Service) in Chapter 25 
(Substantive Rules Applicable to Electric Service Providers), and sec.26.51 of 
this title (relating to Continuity of Service) in Chapter 26 (Substantive Rules 
Applicable to Telecommunications Service Providers).
Mr. Mel Eckhoff, engineering specialist, Office of Regulatory Affairs Electric 
Industry Analysis Division, and Mr. Wesley Oliver, assistant general counsel, 
Office of Regulatory Affairs Legal Division, have determined that for each year 
of the first five-year period the repeal is in effect there will be no fiscal 
implications for state or local government as a result of enforcing or 
administering the repeal. 
Mr. Eckhoff and Mr. Oliver have determined that for each year of the first five 
years the repeal is in effect, the public benefit anticipated as a result of the 
repeal will be the elimination of a duplicative rule. There will be no effect on 
small businesses as a result of repealing this section. There is no anticipated 
economic cost to persons as a result of repealing this section. 
Mr. Eckhoff and Mr. Oliver have also determined that for each year of the first 
five years the repeal is in effect there will be no impact on employment in the 
geographic area affected by the repeal of this section. 
Comments on the proposed repeal (16 copies) may be submitted to the Filing 
Clerk, Public Utility Commission of Texas, 1701 North Congress Avenue, PO Box 
13326, Austin, Texas 78711-3326, within 30 days after publication. All comments 
should refer to Project Number 19198, repeal of sec.23.48. 
This repeal is proposed under the Public Utility Regulatory Act, Texas Utilities 
Code Annotated sec.14.002 (Vernon 1998) (PURA), which provides the Public 
Utility Commission with the authority to make and enforce rules reasonably 
required in the exercise of its powers and jurisdiction. 
Cross Reference to Statutes: Public Utility Regulatory Act sec.14.002.
sec.23.48. Continuity of Service. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State on May 27, 1998.
TRD-9808647
Rhonda Dempsey
Rules Coordinator
Public Utility Commission of Texas
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 936-7308

16 TAC sec.23.57
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Public Utility 
Commission of Texas or in the Texas Register office, Room 245, James Earl Rudder 
Building, 1019 Brazos Street, Austin.)
The Public Utility Commission of Texas (PUC) proposes the repeal of sec.23.57, 
relating to Telecommunications Privacy. Project Number 18870 has been assigned 
to this proceeding. The Appropriations Act of 1997, HB 1, Article IX, Section 
167 (Section 167) requires that each state agency review and consider for 
readoption each rule adopted by that agency pursuant to the Government Code, 
Chapter 2001 (Administrative Procedure Act). Such reviews shall include, at a 
minimum, an assessment by the agency as to whether the reason for adopting or 
readopting the rule continues to exist. The PUC held three workshops to conduct 
a preliminary review of its rules. As a result of these workshops, the PUC is 
reorganizing its current substantive rules located in 16 Texas Administrative 
Code (TAC) Chapter 23 to (1) satisfy the requirements of Section 167; (2) repeal 
rules no longer needed; (3) update existing rules to reflect changes in the 
industries regulated by the commission; (4) do clean-up amendments made 
necessary by changes in law and commission organizational structure and 
practices; (5) reorganize rules into new chapters to facilitate future 
amendments and provide room for expansion; and (6) reorganize the rules 
according to the industry to which they apply. As a result of this 
reorganization, sec.23.57 will be duplicative of proposed new sec.26.121 of this 
title (relating to Privacy Issues), 26.122 of this title (relating to Customer 
Proprietary Network Information), and 26.123 of this title (relating to Caller 
Identification Services), in Chapter 26 of this title (Substantive Rules 
Applicable to Telecommunications Service Providers). 
Mr. Martin Wilson, assistant general counsel, Office of Regulatory Affairs, has 
determined that for each year of the first five-year period the repeal is in 
effect there will be no fiscal implications for state or local government as a 
result of enforcing or administering the repeal. 
Mr. Wilson has determined that for each year of the first five years the repeal 
is in effect, the public benefit anticipated as a result of the repeal will be 
the elimination of a duplicative rule. There will be no effect on small 
businesses as a result of repealing this section. There is no anticipated 
economic cost to persons as a result of repealing this section. 
Mr. Wilson has also determined that for each year of the first five years the 
repeal is in effect there will be no impact on employment in the geographic area 
affected by the repeal of this section. 
Comments on the proposed repeal (16 copies) may be submitted to the Filing 
Clerk, Public Utility Commission of Texas, 1701 N. Congress Avenue, PO Box 
13326, Austin, Texas 78711- 3326, within 30 days after publication. All comments 
should refer to Project Number 18870, repeal of sec.23.57. 
This repeal is proposed under the Public Utility Regulatory Act, Texas Utilities 
Code Annotated sec.14.002 (Vernon 1998) (PURA), which provides the Public 
Utility Commission with the authority to make and enforce rules reasonably 
required in the exercise of its powers and jurisdiction. 
Cross Reference to Statutes: Public Utility Regulatory Act sec.14.002.
sec.23.57. Telecommunications Privacy.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State on May 22, 1998.
TRD-9808496
Rhonda Dempsey
Rules Coordinator
Public Utility Commission of Texas
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 936-7308

CHAPTER 25. Substantive Rules Applicable to Electric Service Providers
SUBCHAPTER C. Quality of Service
16 TAC sec.25.52
The Public Utility Commission of Texas proposes new sec.25.52, relating to 
Continuity of Service. Project Number 19198 has been assigned to this 
proceeding. Proposed new sec.25.52 will replace sec.23.48 of this title 
(relating to Continuity of Service). The proposed rule applies more precise 
interruption record-keeping and reporting requirements, and adopts minimum 
interruption frequency and duration standards. The public's heightened concern 
that Texas electric utilities provide customers with uninterrupted electricity 
service to the greatest reasonable degree warrants these additional 
requirements. Advances in interruption detection and recording capabilities 
enable utilities more effectively to monitor, prevent, and shorten 
interruptions, and also permit the commission to establish meaningful 
reliability performance requirements. 
The Appropriations Act of 1997, HB 1, Article IX, Section 167 (Section 167) 
requires that each state agency review and consider for readoption each rule 
adopted by that agency pursuant to the Government Code, Chapter 2001 
(Administrative Procedure Act). Such reviews shall include, at a minimum, an 
assessment by the agency as to whether the reason for adopting or readopting the 
rule continues to exist. The PUC held three workshops to conduct a preliminary 
review of its rules. As a result of these workshops, the PUC is reorganizing its 
current substantive rules located in 16 Texas Administrative Code (TAC) Chapter 
23 to (1) satisfy the requirements of Section 167; (2) repeal rules no longer 
needed; (3) update existing rules to reflect changes in the industries regulated 
by the commission; (4) do clean-up amendments made necessary by changes in law 
and commission organizational structure and practices; (5) reorganize rules into 
new chapters to facilitate future amendments and provide room for expansion; and 
(6) reorganize the rules according to the industry to which they apply. Chapter 
25 has been established for all commission substantive rules applicable to 
electric service providers. The duplicative sections of Chapter 23 will be 
proposed for repeal as each new section is proposed for publication in the new 
chapter. 
The proposed rule would advance these interests through three requirements. 
First, to the extent possible, each electric utility must maintain complete 
records of emergency, scheduled, and momentary interruptions, and maintain such 
records for five years. Second, the rule would require each electric utility to 
report to the commission basic information concerning extensive and significant 
interruptions as soon as reasonably possible, to update the information each day 
until the interruption ends, and to provide the commission with a report 
summarizing the extent, cause, and magnitude of the interruption. The rule also 
requires utilities to notify the commission how each intends to address through 
its emergency operations plan any adverse situations arising from Year-2000 
related computer problems. Finally, the rule would require each electric utility 
to improve the performance of its worst performing feeders in stages so that by 
April 30, 2001, 98% of the utility's customers will receive service at or above 
the performance levels the utility provided to 90% of its Texas system customers 
for the 12 months ending April 30, 1999. It also would require utilities to 
remedy its worst performing feeders by prohibiting any distribution feeder from 
contributing to the percentage of meters below the standard in consecutive 
years. This portion of the rule ensures that the customers who receive service 
below the standard in 2000 are not the same customers who received service below 
the standard in 1999. The commission believes it should enact more specific 
interruption record-keeping and reporting requirements so that it may evaluate 
utilities' performance more effectively, respond to customer and public 
information demands during significant interruptions, and adequately address 
customer complaints and inquiries relating to service interruptions. The 
Legislature has charged the commission with the responsibility to ensure that 
electric utilities furnish safe, adequate, efficient, and reliable service, 
instrumentalities, and facilities. (Public Utility Regulatory Act sec.32.001). 
Recent experience has demonstrated that both the commission and electric 
utilities should monitor utility reliability performance and take necessary 
measures when a utility has not provided adequate service reliability. The 
commission adopted on July 16, 1997, a service quality report form pursuant to 
sec.23.11(i) of this title (relating to General Reports), and required electric 
utilities to report reliability information semi-annually. The proposed rule 
furthers the objectives of the form-reporting requirements. The commission also 
believes that it should exercise oversight during periods of extensive 
interruptions, both to respond to customer and public inquiries and to ensure 
that the affected utility acts promptly and reasonably during such 
interruptions. Commission access to relevant information concerning the 
interruption constitutes a key requirement to fulfilling this objective. 
The commission believes it should mandate system reliability improvements to 
fulfill its responsibility to ensure that utilities provide safe, adequate, 
efficient, and reliable service. The commission proposes that each utility 
implement improvements resulting in an 8.0% reliability performance increase 
over two years. Electric utilities recently filed reliability performance data 
with the commission reflecting performance during the period May - October 1997. 
The data showed wide variation in the service quality received by utility 
customers, such that many customers received service substantially inferior to 
that provided to the utility's other customers. The commission believes that 
utilities should, to the greatest practical extent, provide every customer with 
high quality, reliable electric service, and that utilities should minimize the 
disparity in electric service reliability provided to its retail customers. The 
proposed rule would accomplish this goal by requiring electric utilities to 
improve its worst performing feeders over a two year period. By April 30, 2000, 
94% of each utility's customers must receive service at or above the same System 
Average Interruption Duration Index (SAIDI) and System Average Interruption 
Frequency Index (SAIFI) performance level provided to the top 90% of customers 
for the 12 month period ending April 30, 1999. By April 30, 2001, 98% of each 
utility's customers must receive this same service level. No distribution feeder 
may contribute to the percentage of customers receiving service at index levels 
above the standard for each index in consecutive years. As a result, more 
electric utility customers will receive a higher service reliability level. 
The commission does not intend to adopt requirements having the unintended 
consequence of requiring inefficient reliability expenditures. Rather, the 
commission seeks to insure that all utility customers receive adequate service. 
The commission recognizes that requiring reliability improvements may risk 
requiring utilities to make inefficient investments in distribution facilities, 
that is, investments that do not create cost-beneficial reliability 
improvements. Generally, some utility customers will receive lesser quality 
service than others, even in situations where all a utility's customers receive 
outstanding service. Accordingly, the proposed rule allows utilities (and 
others) to seek an adjustment to the required SAIFI and SAIDI standards, and the 
commission has requested comments through questions noted below on how the 
commission can insure that the rule does not require utilities to make 
inefficient distribution investments. 
The commission seeks comments both on the proposed rule and on additional 
specific questions directly related to the proposed rule. Parties are requested 
to address comments to the topics listed below. Additionally, parties are 
encouraged to provide comments on any other relevant issues not specifically 
described. 
First, recognizing that different extensive interruption types may warrant 
different reporting requirements, parties are asked to comment whether scheduled 
interruptions should be reported. Should utilities state why alternatives to a 
scheduled interruption cannot reasonably be undertaken? Should the commission 
require a summary report for scheduled interruptions or should utilities only 
file an initial notice? What information should be provided for scheduled 
interruptions, and what information should not be provided?
Second, has the commission identified the appropriate information for utilities 
to submit in cases of extensive and significant interruptions? Should the 
commission require utilities to submit information other than what the rule 
identifies, or has the commission identified any information that will not 
further the commission's ability to monitor and report on extensive 
interruptions? Will collecting the amount of requested information present any 
risk of hampering restoration efforts? 
Third, to what degree, if any, should the commission's rules require utilities 
to report extensive and significant interruption information directly to local 
government officials? If the commission should do so, which local governmental 
officials should receive such information, and what procedure should the 
commission require utilities to follow? 
Fourth, while the commission believes utilities should report interruptions 
affecting numerous customers, parties are requested to comment whether other 
interruptions merit the same reporting requirements. Should utilities report 
interruptions affecting customers with major significance to the community, even 
if the interruption does not affect 10% or 10,000 of the utility's customers, 
such as those affecting major industrial, governmental, or social locations?
Fifth, what information, if any, should the commission require a utility to 
submit as part of its emergency operations plan summary not presently required 
under the existing rule? Should the commission require a utility to file the 
entire emergency operations plan? Should the commission require utilities to 
conduct emergency operations plan drills and report the results? If so, how 
frequently should utilities conduct such drills? 
Sixth, should the commission provide an explicit mechanism for providing an 
exception in cases where a particular year's reliability performance does not 
adequately or appropriately indicate the utility's service efforts and 
management quality? Most notably, should the rule address situations where the 
weather or other circumstances were unusually difficult to overcome and the 
utility's reported service quality does not accurately reflect the utility's 
service efforts? Further, how should the rule treat situations where the 
utility's performance during the 12 month period ending April 30, 1999, does not 
accurately reflect the utility's true service quality and therefore does not 
provide an adequate baseline, due to unusual weather or other conditions 
prevalent during that period? 
Seventh, recognizing that there will always be a "worst 10%" of service provided 
to customers and that some utilities may already have taken actions to remedy 
any service quality deficiencies, should the commission adopt different 
standards for utilities that already provide excellent service quality? If so, 
how should the commission determine what constitutes excellent service, and 
distinguish between utilities that currently provide excellent service quality 
and other utilities? If the commission decides to adopt different standards for 
utilities that provide excellent service quality, what standards should apply? 
Eighth, has the commission set standards at the appropriate levels? Should the 
commission require improvement over a different time period? Should it adopt 
compliance levels other than 94% and 98%? Should the commission adopt a baseline 
other than the service quality provided to 90% of Texas system customers? Are 
SAIDI and SAIFI adequate reflections of system reliability? If not, what 
indicators should the commission use? 
Ninth, would it be appropriate to modify the standards in some limited fashion 
to reflect the differing characteristics that may affect a utility's ability to 
maintain electric service reliability? If so, should such modification be based 
on characteristics such as number of line miles per customer, customers served, 
vegetation density, average age of distribution system, Supervisory Control And 
Data Acquisition (SCADA) capability, or the nature of the service area (rural or 
urban)? 
Tenth, how should the commission enforce the rule's reliability standards? What 
should be the consequences of a utility's failure to meet the standards? What 
actions should the commission take in the event of non-compliance with these 
standards? Should the commission view an overall failure to meet these standards 
as a single violation, or does each failure to provide the required service 
quality to each customer constitute a single rule violation? 
Eleventh, since there is no universally accepted standard for establishing Year 
2000 compliance, what standard should the industry and the commission use for 
establishing the compliance of its computers and systems? 
Twelfth, should the commission require utilities to regularly update critical 
load registries as part of emergency operations planning? If so, with what 
frequency should utilities update these registries? 
Thirteenth, the rule contemplates that utilities will implement system 
reliability improvements over a two year period, but contains no mechanism for 
revising the baseline reliability standards when this process concludes. How 
should the commission adjust the basic reliability standards after April 30, 
2001, if at all? When should the commission revise the reliability standards set 
forth in this proposed rule? 
Finally, in order to implement the proposed rule's reliability provisions, what 
changes are required to the service quality report form or the reporting 
process? How frequently should the commission require utilities to submit 
performance data for every distribution feeder in its Texas system? How 
frequently should the commission require utilities to report the number of 
customers each distribution feeder serves? 
Mr. Mel Eckhoff, engineering specialist, Electric Industry Analysis Division, 
has determined that for each year of the first five-year period the proposed 
section is in effect there will be no fiscal implications for state or local 
government as a result of enforcing or administering the section. 
Mr. Eckhoff has determined that for each year of the first five years the 
proposed section is in effect the public benefit anticipated as a result of 
enforcing the section will be to ensure a minimum quality of service for 
consumers of electric power as it relates to reliability standards. There will 
be no effect on small businesses as a result of enforcing this section. Mr. 
Eckhoff has determined that there may be a slight economic cost to persons who 
are required to comply with the section as proposed. The commission invites 
comments concerning the costs that may be associated with compliance with the 
proposed section. 
Mr. Eckhoff has also determined that for each year of the first five years the 
proposed section is in effect there will be no impact on employment in the 
geographic area affected by implementing the requirements of the section. 
Comments on the proposed new rule (16 copies) may be submitted to the Filing 
Clerk, Public Utility Commission of Texas, 1701 N. Congress Avenue, P.O. Box 
13326, Austin, Texas 78711-3326, within 30 days after publication. All comments 
should refer to Project Number 19198. 
This new section is proposed under the Public Utility Regulatory Act, Texas 
Utilities Code Annotated sec.14.002 (Vernon 1998) (PURA) which provides the 
commission with the authority to make and enforce rules reasonably required in 
the exercise of its powers and jurisdiction; and specifically sec.14.003 which 
grants the commission powers relating to reports; sec.14.151 which grants the 
commission the authority to prescribe the form of records to be kept by a 
utility; sec.14.153 which requires the commission to adopt rules governing 
communications with the commission; sec.31.001 and sec.32.001 which require the 
commission to regulate electric utility operations and services; sec.37.151 
which requires certificate holders to provide continuous and adequate service in 
their service areas; sec.38.001 which requires electric utilities to furnish 
service, instrumentalities, and facilities that are safe, adequate, efficient, 
and reasonable; sec.38.002 which grants the commission authority to adopt just 
and reasonable standards, classifications, rules, or practices an electric 
utility must follow, and to adopt adequate and reasonable standards for 
measuring a condition, including quantity, quality, pressure, and initial 
voltage, relating to the furnishing of a service; and sec.38.071 which grants 
the commission authority to order an electric utility to provide specified 
improvements in its service in a specified area if requiring the company to 
provide the improved service is reasonable. 
Cross Index to Statutes: Public Utility Regulatory Act sec.sec.14.002, 14.003, 
14.151, 14.153 31.001, 32.001, 37.151, 38.001, 38.002 and 38.071.

sec.25.52. Continuity of Service. 
(a) Application. This section applies to all electric utilities providing 
distribution or transmission service in Texas. 
(b) General. 
(1) Every utility shall make all reasonable efforts to prevent interruptions of 
service. When interruptions occur, the utility shall reestablish service within 
the shortest possible time. 
(2) Each utility shall make reasonable provisions to manage emergencies 
resulting from failure of service, and each utility shall issue instructions to 
its employees covering procedures to be followed in the event of emergency in 
order to prevent or mitigate interruption or impairment of service. 
(3) In the event of national emergency or local disaster resulting in disruption 
of normal service, the utility may, in the public interest, interrupt service to 
other customers to provide necessary service to civil defense or other emergency 
service agencies on a temporary basis until normal service to these agencies can 
be restored.
(c) Definitions. The following words and terms, when used in this section, shall 
have the following meanings unless the context clearly indicates otherwise.
(1) Critical loads - Loads for which electric service is considered crucial for 
the protection or maintenance of public safety; including but not limited to 
hospitals, police stations, fire stations, critical water and wastewater 
facilities, and customers with special in-house life-sustaining equipment. 
(2) Interruption classifications: 
(A) Forced - Interruptions, exclusive of major events, that result from 
conditions directly associated with a component requiring that it be taken out 
of service immediately, either automatically or manually, or an interruption 
caused by improper operation of equipment or human error.
(B) Scheduled - Interruptions, exclusive of major events, that result when a 
component is deliberately taken out of service at a selected time for purposes 
of construction, preventative maintenance, or repair. If it is possible to defer 
an interruption, the interruption is considered a scheduled interruption.
(C) Outside causes - Interruptions, exclusive of major events, that are caused 
by outside influences such as generation, transmission, or substation outages. 
(Non-distribution system causes)
(D) Major events - Interruptions that result from a catastrophic event that 
exceeds the design limits of the electric power system, such as an earthquake or 
an extreme storm. These events shall include situations where there is a loss of 
power to 10% or more of the customers in a region over a 24 hour period and with 
all customers not restored within 24 hours.
(3) Interruption, momentary - Single operation of an interrupting device which 
results in a voltage zero.
(4) Interruption, sustained - All interruptions not classified as momentary. 
(5) Interruptions, significant - All interruptions of any classification lasting 
one hour or more and affecting the entire system, a major division of the 
system, a community, a critical load, service to interruptible customers, 10% or 
more of the system's customers, or 10,000 customers for utilities serving more 
than 100,000 customers. Significant interruptions also include interruptions 
adversely affecting a community such as interruptions of governmental agencies, 
military bases, universities and schools, major retail centers, and major 
employers. 
(6) Reliability indices: 
(A) System Average Interruption Frequency Index (SAIFI) - The average number of 
times that a customer's service is interrupted. SAIFI is calculated by summing 
'the number of customers interrupted for each event' and dividing by 'the total 
number of customers' on the system being indexed. A lower SAIFI value represents 
a higher level of service reliability. 
(B) System Average Interruption Duration Index (SAIDI) - The average amount of 
time a customer's service is interrupted during the reporting period. SAIDI is 
calculated by summing 'the restoration time for each interruption event' times 
'the number of customers interrupted for each event', and dividing by 'the total 
number of customers'. SAIDI is expressed in minutes or hours. A lower SAIDI 
value represents a higher level of service reliability. 
(7) Year 2000 compliant - A computer system or application that accurately 
process date/time data (including but not limited to calculating, comparing, and 
sequencing) from, into, and between the 20th and 21st centuries, the years 1999 
and 2000, and leap year calculations. 
(8) Year 2000 ready - A computer system or application that has been determined 
to be suitable for continued use into the year 2000 even though the computer 
system or application is not fully year 2000 compliant.
(d) Record of interruption. Each utility shall keep a complete record of 
sustained interruptions of all classifications. Where possible, each utility 
shall keep a complete record of all momentary interruptions. This record shall 
show the type of interruption, the cause for the interruption, the date and time 
of the interruption, the duration of the interruption, the number of customers 
interrupted, the substation identifier, and the transmission line or 
distribution feeder identifier. In cases of emergency interruptions, the remedy 
and steps taken to prevent recurrence shall also be recorded. Beginning July 1, 
1997, each utility shall retain records of interruptions for five years. 
(e) Notice of significant interruptions. 
(1) Initial notice. An electric utility shall notify the commission, in a method 
prescribed by the commission, as soon as reasonably possible after it has 
determined that an significant interruption has occurred. The initial notice 
shall include the general location of the significant interruption, the 
approximate number of customers affected, the cause if known, the time of the 
event, and the estimated time of full restoration. The initial notice shall also 
include the name and telephone number of the utility contact person, and shall 
indicate whether or not local authorities and media have been contacted. If the 
duration of the significant interruption is greater than 24 hours, the utility 
shall update this information daily. 
(2) Summary report. Within five working days after the end of an significant 
interruption, the utility shall submit a summary report to the commission. The 
summary report shall include the date and time of the significant interruption; 
the date and time of full restoration; the cause of the interruption, the 
location, substation and feeder identifiers of all affected facilities; the 
total number of customers affected; the dates, times, and numbers of customers 
affected by partial or step restoration; and the total number of customer-
minutes of the significant interruption (sum of the interruption durations times 
the number of customers affected).
(f) Emergency Operations Plan. By December 31, 1998, each utility shall file 
with the commission a general description of its emergency operations plan. Each 
utility shall update its plan by filing revision sheets that clearly indicate 
any changes in the plan at least 30 days before such changes take effect. A 
general description of the plan shall also be made available at the utility's 
main office for inspection by the public. A complete copy of the plan shall be 
made available at the utility's main office for inspection by the commission or 
its staff upon request. Each electric utility's emergency plan must include, but 
need not be limited to, the following:
(1) a registry of critical loads directly served by the utility;
(2) a communications plan that describes the procedures for contacting the media 
and customers and critical loads directly served by the utility as soon as 
reasonably possible either before or at the onset of an electrical emergency. 
The communications plan should also address how the utility's telephone system 
and complaint handling procedures will be augmented during an emergency. 
Utilities should make every reasonable effort to solicit help from cogenerators 
and independent power producers during times of generation shortages to prevent 
interruptions in service; 
(3) curtailment priorities and procedures for shedding load and rotating black-
outs; 
(4) priorities for restoration of service; 
(5) a summary of power plant weatherization plans and procedures; 
(6) a summary of the utility's alternative fuel and storage capacity; 
(7) a description of the utility's "Year-2000" contingency plan and mitigation 
strategies for dealing with potential failures caused by computers that are not 
year 2000 ready or year 2000 compliant. This description should identify 
potentially vulnerable systems and business processes and prioritize them. The 
description should also include the utility's plans for backups for critical 
customers and processes, and report estimated costs for contingency operations. 
(g) System reliability. 
(1) Reliability standards. Reliability standards shall apply to each electric 
utility. The standards shall be unique to each utility based on the utility's 
performance during the 12-month period ending April 30, 1999, adjusted if 
appropriate, and limited to the Texas jurisdiction. 
(A) The SAIFI standard for forced interruptions shall be established at the 
SAIFI value at which no fewer than 90% of the utility's meters are receiving 
service at or above the standard. 
(B) The SAIDI standard for forced interruptions shall be established at the 
SAIDI value at which no fewer than 90% of the utility's meters are receiving 
service at or above the standard. 
(2) Reliability improvements. 
(A) For the 12-month period ending April 30, 2000, each utility shall operate 
and maintain its distribution system such that feeders serving no fewer than 94% 
of the utility's meters are receiving service at or above the standard for each 
index. 
(B) For the 12-month period ending April 30, 2001, and for each succeeding year, 
each utility shall operate and maintain its distribution system such that 
feeders serving no fewer than 98% of the utility's meters are receiving service 
at or above the standard for each index. 
(C) No distribution feeder shall fail to attain the SAIDI and SAIFI standards 
for two or more consecutive reporting years. Each distribution feeder must 
comply with this provision no later than April 30, 2000. A "reporting year" is 
the 12-month period beginning May 1st and ending April 30th each year.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State on May 27, 1998.
TRD-9808648
Rhonda Dempsey
Rules Coordinator
Public Utility Commission of Texas
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 936-7308

CHAPTER 26. Substantive Rules Applicable to Telecommunications Service Providers
SUBCHAPTER C. Quality of Service
16 TAC sec.26.51
The Public Utility Commission of Texas (PUC) proposes new sec.26.51, relating to 
Continuity of Service. The proposed section will establish service interruption 
recording and reporting guidelines for dominant carriers and local exchange 
companies, as defined in sec.26.5 of this title (relating to Definitions). 
Project Number 19199 has been assigned to this proceeding. 
The Appropriations Act of 1997, HB 1, Article IX, Section 167 (Section 167) 
requires that each state agency review and consider for readoption each rule 
adopted by that agency pursuant to the Government Code, Chapter 2001 
(Administrative Procedure Act). Such reviews shall include, at a minimum, an 
assessment by the agency as to whether the reason for adopting or readopting the 
rule continues to exist. The PUC held three workshops to conduct a preliminary 
review of its rules. As a result of these workshops, the PUC is reorganizing its 
current substantive rules located in 16 Texas Administrative Code (TAC) Chapter 
23 to (1) satisfy the requirements of Section 167; (2) repeal rules no longer 
needed; (3) update existing rules to reflect changes in the industries regulated 
by the commission; (4) do clean-up amendments made necessary by changes in law 
and commission organizational structure and practices; (5) reorganize rules into 
new chapters to facilitate future amendments and provide room for expansion; and 
(6) reorganize the rules according to the industry to which they apply. 16 TAC 
Chapter 26 has been established for all commission substantive rules applicable 
to telecommunications service providers. The duplicative sections of Chapter 23 
will be proposed for repeal as each new section is proposed for publication in 
chapter 26. 
The subsections in proposed sec.26.51 will replace corresponding subsections in 
sec.23.48 of this title (relating to Continuity of Service). 
The proposed section makes several substantive changes. First, the proposed 
section will apply only to telecommunications service. The electric analog will 
be recodified in proposed new sec.25.52 of this title. Second, the proposed 
section applies to dominant carriers and local exchange companies. The 
definitional change extends service interruption recording and reporting 
requirements to Certificate of Convenience and Necessity (CCN) and Certificate 
of Operating Authority (COA) holders. Customers served by CCN and COA holders 
should benefit from the expanded scope of the section. Finally, the proposed 
section requires dominant carriers and local exchange companies to file with the 
commission a description of their preparedness to deal with "Year 2000" 
problems, including the utilities' plans to remedy any "Year 2000" problems it 
will face. 
Wesley A. Oliver, assistant general counsel, Office of Regulatory Affairs, has 
determined that for each year of the first five-year period the proposed section 
is in effect there will be no fiscal implications for state or local government 
as a result of enforcing or administering the section. 
Mr. Oliver has determined that for each year of the first five years the 
proposed section is in effect the public benefit anticipated as a result of 
enforcing the section will be continued public assuredness that dominant 
carriers, local exchange companies, and the commission will closely monitor 
telecommunications service interruptions, and are prepared to minimize the 
impact of telecommunications service interruptions on the public. There will be 
no effect on small businesses as a result of enforcing this section. There is no 
anticipated economic cost to persons who are required to comply with the section 
as proposed. 
Mr. Oliver has also determined that for each year of the first five years the 
proposed section is in effect there will be no impact on employment in the 
geographic area affected by implementing the requirements of the section 
Comments on the proposed new rule (16 copies) may be submitted to the Filing 
Clerk, Public Utility Commission of Texas, 1701 N. Congress Avenue, P.O. Box 
13326, Austin, Texas 78711-3326, within 30 days after publication. The 
commission invites specific comments regarding the costs associated with, and 
benefits that will be gained by, implementation of the proposed section. The 
commission will consider the costs and benefits in deciding whether to adopt the 
section. All comments should refer to Project Number 19199.
This new section is proposed under the Public Utility Regulatory Act, Texas 
Utilities Code Annotated sec.14.002 (Vernon 1998) (PURA), which provides the 
Public Utility Commission with the authority to make and enforce rules 
reasonably required in the exercise of its powers and jurisdiction, including 
rules of practice and procedure. 
Cross Reference to Statutes: Public Utility Regulatory Act sec.14.002.

sec.26.51. Continuity of Service.
(a) Application. Unless the context clearly indicates otherwise, in this section 
the term "utility," insofar as it relates to telecommunications utilities, shall 
refer to dominant carriers and local exchange companies as defined in sec.26.5 
of this title (relating to Definitions). 
(b) Definitions. The following words and terms, when used in this section, shall 
have the following meanings unless the context clearly indicates otherwise. 
(1) Year 2000 compliant - A computer system or application that accurately 
process date/time data (including but not limited to calculating, comparing, and 
sequencing) from, into, and between the 20th and 21st centuries, the years 1999 
and 2000, and leap year calculations. 
(2) Year 2000 ready - A computer system or application that has been determined 
to be suitable for continued use into the year 2000 even though the computer 
system or application is not fully year 2000 compliant.
(c) Service interruptions. 
(1) Every utility shall make all reasonable efforts to prevent interruptions of 
service. When interruptions occur, the utility shall reestablish service within 
the shortest possible time. 
(2) Each utility shall make reasonable provisions to handle emergencies 
resulting from failure of service, and each utility shall issue instructions to 
its employees covering procedures to be followed in the event of emergency in 
order to prevent or mitigate interruption or impairment of service. 
(3) In the event of national emergency or local disaster resulting in disruption 
of normal service, the utility may, in the public interest, interrupt service to 
other customers to provide necessary service to civil defense or other emergency 
service agencies on a temporary basis until normal service to these agencies can 
be restored. 
(d) Record of interruption. Except for momentary interruptions due to automatic 
equipment operations, each utility shall keep a complete record of all 
interruptions, both emergency and scheduled. This record shall show the cause 
for interruptions, date, time, duration, location, approximate number of 
customers affected, and, in cases of emergency interruptions, the remedy and 
steps taken to prevent recurrence. 
(e) Report to commission. The following guidelines are a minimum basis for 
reporting service interruptions. Any report of service interruption shall state 
the cause(s) of the interruption. Utilities should use judgment in reporting 
major outages lasting less than four hours. Utilities shall notify the 
commission in writing of interruptions in service lasting four or more hours 
affecting: 
(1) 50% of the toll circuits serving an exchange; 
(2) 50% of the extended area service circuits serving an exchange; 
(3) 50% of a central office; or 
(4) 20% or more of an exchange's access lines. 
(f) Change in character of service. In case any change is made by the utility in 
the type of service rendered which would adversely affect the efficiency of 
operation or the adjustment of the equipment of customers, all customers who may 
be affected shall be notified by the utility at least 60 days in advance of the 
change or if such notice is not possible, as early as feasible. Where 
adjustments or replacements of the utility's standard equipment must be made to 
permit use under such changed conditions, adjustment shall be made by the 
utility without charge to the customers, or in lieu of such adjustments or 
replacements, the utility may make cash or credit allowances based on the 
duration of the change and the degree of efficiency loss. 
(g) Emergency Operations Plan. Within 60 days of becoming an utility, each 
utility shall file with the commission a general description of its emergency 
operations plan. Each utility shall thereafter update its plan by filing 
revision sheets that clearly indicate any changes in the plan within 30 days of 
such changes. A general description of the plan shall also be made available at 
the utility's main office for inspection by the public. A complete copy of the 
plan shall be made available at the utility's main office for inspection by the 
commission or its staff upon request. Each emergency plan filed by an utility 
must include, but need not be limited to, the following:
(1) a communications plan that describes the procedures for contacting the 
media, customers and critical users (including but not limited to hospitals, 
police stations, fire stations and critical city offices) as soon as reasonably 
possible either before or at the onset of an emergency. The communications plan 
should also:
(A) address how the utility's telephone system and complaint handling procedures 
will be augmented during an emergency; 
(B) identify key personnel and equipment that will be required to implement the 
plan when an emergency occurs; 
(2) priorities for restoration of service. 
(3) a description of the utility's "Year-2000" contingency plan and mitigation 
strategies for dealing with potential failures caused by computers that are not 
year 2000 compliant or year 2000 ready. This description should identify 
potentially vulnerable systems and business processes and prioritize them. The 
description should also include the utility's plans for backups for critical 
customers and processes, and report estimated costs for contingency operations.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State on May 27, 1998.
TRD-9808649
Rhonda Dempsey
Rules Coordinator
Public Utility Commission of Texas
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 936-7308

SUBCHAPTER F. Regulation of Telecommunications Service
16 TAC sec.sec.26.121-26.123
The Public Utility Commission of Texas (PUC or commission) proposes new 
sec.26.121 relating to Privacy Issues, sec.26.122 relating to Customer 
Proprietary Network Information, and sec.26.123 relating to Caller 
Identification Services. Project number 18870 has been assigned to this 
proceeding. These new sections will replace sec.23.57 of this title (relating to 
Telecommunications Privacy). The section change is necessary to comply with the 
Customer Proprietary Network Information (CPNI) provisions of the federal 
Telecommunications Act of 1996 (Telecommunications Act of 1996 sec.5, 47 
U.S.C.A. sec.222) and the Public Utility Regulatory Act (PURA). 
The Appropriations Act of 1997, HB 1, Article IX, Section 167 (Section 167) 
requires that each state agency review and consider for readoption each rule 
adopted by that agency pursuant to the Government Code, Chapter 2001 
(Administrative Procedure Act). Such reviews shall include, at a minimum, an 
assessment by the agency as to whether the reason for adopting or readopting the 
rule continues to exist. The PUC held three workshops to conduct a preliminary 
review of its rules. As a result of these workshops, the PUC is reorganizing its 
current substantive rules located in 16 Texas Administrative Code (TAC) Chapter 
23 to (1) satisfy the requirements of Section 167; (2) repeal rules no longer 
needed; (3) update existing rules to reflect changes in the industries regulated 
by the commission; (4) do clean-up amendments made necessary by changes in law 
and commission organizational structure and practices; (5) reorganize rules into 
new chapters to facilitate future amendments and provide room for expansion; and 
(6) reorganize the rules according to the industry to which they apply. 16 TAC 
Chapter 26 has been established for all commission substantive rules applicable 
to telecommunications service providers. The duplicative sections of Chapter 23 
will be proposed for repeal as each new section is proposed for publication in 
the new chapter. As part of a larger reorganization of the substantive rules, 
the commission proposes dividing sec.23.57 into three separate sections which 
will each address a distinct privacy issue. In its current form, sec.23.57(b) 
addresses privacy considerations, subsection (c) addresses new services or 
features, subsection (d) addresses notice of number delivery over 800 and 900 
services, subsection (e) addresses customer proprietary network information, 
subsection (f) addresses aggregate CPNI, subsection (g) addresses caller 
identification services, and subsection (h) addresses usage of calling party 
information in other services. Proposed new sec.26.121 will replace 
sec.23.57(b), (c), and (d) regarding privacy considerations, new services or 
features, and notice of number delivery over 800 and 900 services. Proposed new 
sec.26.122 will replace sec.23.57(e) and (f), regarding CPNI, and adds a 
subsection regarding subscriber list concerns. Proposed new sec.26.123 will 
replace sec.23.57(g) and (h) regarding caller identification services and usage 
of calling party information in other services. 
Martin Wilson, assistant general counsel, Office of Regulatory Affairs, has 
determined that for each year of the first five-year period the proposed 
sections are in effect there will be no fiscal implications for state or local 
government as a result of enforcing or administering the sections.
Mr. Wilson has determined that, over this same period of time, the public will 
benefit from the conformity of standards relating to CPNI and aggregate CPNI 
between federal statute and Texas state rules. These sections further the 
commission's general policy regarding telecommunications privacy, which is 
intended to advance a balanced approach between promoting competition and 
enabling customers to control the outflow of information. The public benefit 
anticipated as a result of enforcing proposed sec.26.121 and sec.26.123 will be 
the protection of certain privacy concerns. There will be no effect on small 
businesses as a result of enforcing these sections. There is no anticipated 
economic cost to persons who are required to comply with the sections as 
proposed. Mr. Wilson has determined that for each year of the first five years 
the proposed section is in effect there will be no impact on employment in the 
geographic area affected by implementing the requirements of these sections. 
Comments on the proposed sections (16 copies) may be submitted to Filing Clerk, 
Public Utility Commission of Texas, 1701 N. Congress Avenue, P.O. Box 13326, 
Austin, TX 78711- 3326, within 30 days after publication. The commission invites 
specific comments regarding the costs associated with, and benefits that will be 
gained by, implementation of the new sections. All comments should refer to 
Project Number 18870. 
These sections are proposed under the Public Utility Regulatory Act, Texas 
Utilities Code Annotated sec.14.002 (Vernon 1998) (PURA) which provides the 
Public Utility Commission with the authority to make and enforce rules 
reasonably required in the exercise of its powers and jurisdiction; PURA 
sec.62.022 which sets out requirements relating to a telecommunication utility's 
use of specific customer proprietary network information; and PURA sec.62.023 
provides for the adoption of sections consistent with the Federal Communications 
Commission's rules relating to specific customer proprietary network 
information. 
Cross Index to Statutes: Public Utility Regulatory Act sec.sec.14.002, 62.022 
and 62.023.

sec.26.121. Privacy Issues.
(a) Application. Unless the context clearly indicates otherwise, in this section 
the term "utility" shall refer to all dominant certificated telecommunications 
utilities as defined in sec.26.5 of this title (relating to Definitions). 
(b) Purpose. It is commission policy that customers of all dominant certificated 
telecommunications utilities should be permitted to control the outflow of 
information about themselves. 
(c) Lost Privacy. Any dominant certificated telecommunications utility proposing 
to offer a new service or a new feature to an existing service under the 
provisions of sec.23.24 of this title (relating to Form and Filing of Tariffs), 
sec.23.25 of this title (relating to Procedures Applicable to Chapter 58 
Electing Incumbent Local Exchange Companies (ILECs)), sec.23.26 of this title 
(relating to New and Experimental Services), sec.23.27 of this title (relating 
to Rate-Setting Flexibility for Services Subject to Significant Competitive 
Challenges), or sec.23.28 of this title (relating to Promotional Rates for LEC 
Services) for which the commission finds diminished customer privacy, and for 
which the dominant certificated telecommunications utility has not shown good 
cause pursuant to subsections (d)(2)(B)(ii) and (d)(2)(D) of this section, must, 
in a manner ordered by the commission: 
(1) provide a means of restoring the lost privacy at no charge to customers; and 
(2) educate all customers as to the means to regain the lost privacy. 
(d) New services or features. For all dominant certificated telecommunications 
utility applications filed pursuant to sec.23.24 of this title, sec.23.25 of 
this title, sec.23.26 of this title, sec.23.27 of this title, or sec.23.28 of 
this title, the dominant certificated telecommunications utility must identify 
all privacy issues, as that term is defined in sec.26.5 of this title, that 
result from the implementation of the new service or feature, and all privacy 
issues that could diminish customers' privacy. 
(1) Identification of privacy issues. The dominant certificated 
telecommunications utility shall identify all privacy issues that result from 
the implementation of the new service or feature. Identification of privacy 
issues shall include, but not be limited to: 
(A) identification and description of the type of information that is released 
as a result of the new service or feature; 
(B) identification of the category of customers about whom information will be 
released; 
(C) identification of the category of entities to whom information about a 
customer will be released; 
(D) identification and description of the change in the technology used to 
convey the information; 
(E) identification and description of the change in the time at which the 
information is conveyed; and 
(F) identification and description of any other change in the collection, use, 
storage, or release of information. 
(2) Lost degree of privacy. For each privacy issue identified pursuant to 
paragraph (1) of this subsection, the dominant certificated telecommunications 
utility shall identify all circumstances under which a customer of the dominant 
certificated telecommunications utility may experience diminished privacy as a 
result of the implementation of the new service or feature proposed in the 
application, including, but not limited to, whether a customer's name, address, 
or telephone number will be provided to a called party or to any other third 
party, and for each such circumstance identified:
(A) state whether the lost degree of privacy can be restored by the affected 
customers and how such customers can restore it; 
(B) state whether the dominant certificated telecommunications utility will 
charge the affected customers for restoring the lost degree of privacy and, if 
applicable: 
(i) state what such charge will be; and 
(ii) show good cause for such charge; 
(C) state how the dominant certificated telecommunications utility will educate 
the affected customers as to the implications for privacy and, if applicable, 
the means by which such customers can restore the lost degree of privacy; and 
(D) show good cause, if applicable, for not offering the affected customers a 
means by which the lost degree of privacy can be restored. 
(3) Staff review. Staff shall review all applications submitted by a dominant 
carrier under the provisions of sec.23.24 of this title, sec.23.25 of this 
title, sec.23.26 of this title, sec.23.27 of this title, or sec.23.28 of this 
title for privacy issues and privacy issues resulting in a lost degree of 
privacy. 
(e) Notice of number delivery over 800 and 900 services. The dominant 
certificated telecommunications utilities shall print in the white pages of 
their telephone directories, and send as a billing insert annually to all of 
their customers, the statement: "Per-line or per-call blocking does not prevent 
transmission of your telephone number when you call a company using an 800 or 
900 number. Therefore, your number may be available to that company's service 
representative before your call is answered." The statement must appear in all 
telephone directories published for the dominant certificated telecommunications 
utility subsequent to the effective date of this section. The statement must 
appear annually as a billing insert for each dominant certificated 
telecommunications utility.

sec.26.122. Customer Proprietary Network Information. 
(a) Application. This section applies to all certificated telecommunications 
utilities as defined in sec.26.5 of this title (relating to Definitions). 
(b) Purpose. The purpose of this section is to delineate the circumstances in 
which telecommunications utilities are required to gain approval of the customer 
prior to using, disclosing, or permitting access to customer-specific customer 
proprietary network information (CPNI), and to set forth the requisites for 
obtaining customer notification and approval. This section is intended to be 
consistent with the federal Telecommunications Act of 1996 sec.222 in balancing 
competitive and consumer privacy interests with respect to customer-specific 
CPNI. 
(c) Customer approval not required. A telecommunications utility may use, 
disclose, or permit access to customer-specific CPNI, without customer approval, 
as described in this subsection. 
(1) Generally. Any telecommunications utility may use, disclose, or permit 
access to customer-specific CPNI for the purpose of providing or marketing 
service offerings among the categories of service (i.e. local, interexchange) 
already subscribed to by the customer from the same utility, without customer 
approval. Any telecommunications utility may use, disclose, or permit access to 
customer- specific CPNI for the purpose of providing optional extended area 
calling plans that a telecommunications utility may offer pursuant to sec.23.49 
of this title (relating to Telephone Extended Area Service (EAS) and Expanded 
Toll-free Local Calling Areas), or pursuant to a final order of the commission 
in a proceeding pursuant to the Public Utility Regulatory Act sec.sec.51.109, 
53.101- 53.113, 53.151, 53.152, 53.201, 53.202, 53.251, 53.252, 53.301, and 
53.303- 53.307. 
(2) Affiliates. If a telecommunications utility provides different categories of 
service, and a customer subscribes to more than one category of service offered 
by the telecommunications utility, the utility is permitted to share customer-
specific CPNI only to those affiliated entities that provide a service offering 
to the customer. If the telecommunications utility provides different categories 
of service, but a customer does not subscribe to more than one category, the 
telecommunications utility is not permitted to share customer-specific CPNI with 
its affiliated entities. 
(3) Customer's right to restrict CPNI. Even though customer approval is not 
required for situations set forth in subsection (c)(1) and (2) of this section, 
a customer may notify the telecommunications utility that such customer 
restricts the use of, disclosure of, and access to that customer's specific CPNI 
for use in the situations described in subsection (c)(1) and (2) of this 
section. 
(4) Exceptions. Nothing in this section prohibits a telecommunications utility 
from using, disclosing, or permitting access to customer-specific CPNI obtained 
from its customers, either directly or indirectly: 
(A) to provide inside wiring installation, maintenance, or repair services; 
(B) to initiate, render, bill for, or collect for customer-authorized 
telecommunications services; 
(C) to protect the rights or property of the utility, or to protect users of 
those services and other carriers from fraudulent, abusive, or unlawful use of, 
or subscription to, such services; or 
(D) to market services other than those to which a residential customer already 
subscribes, if such customer contacts the telecommunications utility to inquire 
about such services offered by the telecommunications utility. 
(E) to conduct research on the health effects of commercial mobile radio 
services (CMRS). 
(d) Customer approval required. Except as described in subsection (c) of this 
section, a telecommunications utility may not use, disclose, or permit access to 
customer-specific CPNI, without customer approval, for the following: 
(1) to market to a customer service offerings that are within a category of 
service to which the customer does not already subscribe from that 
telecommunications utility, unless the telecommunications utility has customer 
approval to do so; 
(2) to provide customer premises equipment and information services, including 
call answering, voice mail or messaging, voice storage and retrieval services, 
fax store and forward, and Internet access; 
(3) to identify or track customers who call competing service providers; 
(4) to access a former customer's CPNI to regain the business of the customer 
who has switched to another service provider. 
(e) Obtaining customer approval. A telecommunications utility is required by 
this section to obtain customer approval to use, disclose, or permit access to 
customer-specific CPNI to market a customer service to which the customer does 
not already subscribe from that telecommunications utility must do so in 
compliance with the following requirements of this subsection. Customer approval 
remains in effect until the customer revokes or limits such approval. 
(1) A telecommunications utility may obtain approval through written, oral, or 
electronic methods; 
(2) A telecommunications utility relying on oral approval must bear the burden 
of demonstrating that such approval has been given in compliance with this 
section; 
(3) A telecommunications utility must maintain records of notification and 
approval, whether oral, written, or electronic, for at least one year. 
(f) Notification. Prior to any solicitation for customer approval, a 
telecommunications utility must provide a one-time notification to the customer 
of the customer's right to restrict use of, disclosure of, and access to that 
customer's CPNI. In addition to printing such notification in the white pages of 
its telephone directories, a telecommunications utility shall provide 
notification through oral or written methods. Notification must provide 
sufficient information to enable the customer to make an informed decision as to 
whether to permit a telecommunications utility to use, disclose or permit access 
to, the customer's CPNI. 
(1) At a minimum, customer notification shall provide, in reasonably 
comprehensible language: 
(A) An explanation of customer-specific CPNI, and the types of information that 
constitute customer-specific CPNI. 
(B) An explanation of the telecommunications utility's duty, and the customer's 
right, under federal law, to restrict the telecommunications utility's use of 
his or her customer specific CPNI. 
(C) A statement that specifically explains the manner in which the customer may 
grant or restrict the telecommunications utility's use of his or her customer 
specific CPNI. 
(D) An explanation to the customer that restricting the telecommunications 
utility's use of customer specific CPNI may not eliminate all marketing contacts 
from the telecommunications utility. 
(E) A statement that there will be no charge to the customer for electing to 
restrict the use of his or her customer specific CPNI. 
(F) A statement informing the customer that denial of approval will not affect 
the provision of any services to which the customer subscribes.
(G) A statement explaining that any approval or denial of approval for the use 
of customer-specific CPNI outside of the service to which the customer already 
subscribes to from that telecommunications utility is valid until the customer 
affirmatively revokes or limits such approval or denial. 
(H) A statement explaining the limited circumstances described in paragraph (2) 
of this subsection, under which a telecommunications utility may use customer-
specific CPNI to market services other than those to which the customer already 
subscribes, even if the customer requests restriction of the use of the 
customer-specific CPNI. 
(I) A telecommunications utility also may state in the notification that the 
customer may use an affirmative written request to direct the telecommunications 
utility to disclose CPNI to a specific person or for a specific purpose.
(2) Even if a residential customer requests restriction of the use of his or her 
customer- specific CPNI, a telecommunications utility may use customer-specific 
CPNI to market services other than those to which the customer already 
subscribes, if such customer contacts the telecommunications utility to inquire 
about such services offered by the telecommunications utility. 
(3) Other notification requirements. A telecommunications utility shall adhere 
to the following notification specifications: 
(A) If any notification is translated into another language, then all portions 
of the notification must be translated into that language.
(B) A utility may state in the notification that the customer's approval to use 
customer-specific CPNI may enhance the telecommunications utility's ability to 
offer products and services tailored to the customer's needs. 
(C) A telecommunications utility may not include in the notification any 
statement attempting to encourage a customer to freeze third party access to 
customer-specific CPNI.
(D) A telecommunications utility's solicitation for approval must be proximate 
in time to the notification of a customer's CPNI rights, and if written, placed 
in the same envelope in which notification is mailed.
(4) Staff review of the notification. The notification shall be reviewed by the 
staff of the Regulatory Division of the commission before it is distributed. The 
staff of the Regulatory Division shall notify the telecommunications utility 
within ten days of submission whether the proposed notification may be 
distributed or must be modified and distributed. 
(g) Safeguards. Prior to solicitation of a customer's approval, a 
telecommunications utility must establish the following with respect to 
safeguard provisions for the use of customer- specific CPNI: 
(1) Telecommunications utilities must develop and implement software that 
indicates within the first few lines of the first screen of a customer's service 
record the CPNI approval status, and reference the customer's existing service 
subscription. 
(2) Telecommunications utilities must train their personnel as to when they are 
and are not authorized to use CPNI, and carriers must have an express 
disciplinary process in place. 
(3) Telecommunications utilities must maintain an electronic audit mechanism 
that tracks access to customer accounts, including when a customer's record is 
opened, by whom, and for what purpose. Telecommunications utilities must 
maintain these contact histories for a minimum period of one year. 
(4) Telecommunications utilities must establish a supervisory review process 
regarding telecommunications utility compliance with the provisions of the 
subsection for outbound marketing situations and maintain records of 
telecommunications utility compliance for a minimum period of one year. 
Specifically, sales personnel must obtain supervisory approval of any proposed 
outbound marketing request. 
(5) A telecommunications utility must have a corporate officer, as an agent of 
the telecommunications utility, sign an affidavit on an annual basis that the 
officer has personal knowledge that the telecommunications utility is in 
compliance with the rules in this subsection. A statement explaining how the 
telecommunications utility is in compliance with the provisions in this 
subsection must accompany the affidavit. 
(h) Aggregate CPNI. If a telecommunications utility compiles and uses aggregate 
CPNI for marketing purposes or provides aggregate CPNI to any business 
associated with the telecommunications utility for marketing purposes, it must 
also provide aggregate CPNI to any third party upon request, except when a Local 
Exchange Carrier uses aggregate information only to tailor its service offering 
to better suit the needs of its existing customers. A telecommunications utility 
must offer to provide aggregate CPNI under the same terms and conditions and at 
the same price as it is made available to all businesses affiliated with the 
telecommunications utility and to utility personnel marketing supplemental 
services, provided that the third party must specify the type and scope of the 
aggregate CPNI requested. A telecommunications utility must, upon request, 
provide such aggregate CPNI to a third party under any other alternative terms, 
conditions, or prices that are just and reasonable under the circumstances and 
that are not unreasonably preferential, prejudicial or discriminatory. 
(i) Subscriber list information. A telecommunications utility that provides 
telephone exchange service shall provide subscriber list information gathered in 
its capacity as a provider of such service on a timely and unbundled basis, 
under nondiscriminatory and reasonable rates, terms, and conditions, to any 
person upon request, to the extent that such person uses the subscriber list 
information solely for publishing directories in any format. 
(j) Definition. The term ''subscriber list information,'' when used in 
subsection (i) of this section, means any information: 
(1) identifying the listed names of subscribers of a telecommunications utility 
and such subscribers' telephone numbers, addresses, or primary advertising 
classifications (as such classifications are assigned at the time of the 
establishment of such service), or any combination of such listed names, 
numbers, addresses, or classifications; and 
(2) that the telecommunications utility or an affiliate has published, caused to 
be published, or accepted for publication in any directory format. 

sec.26.123. Caller Identification Services. 
(a) Application. Unless the context clearly indicates otherwise, this section 
applies to all telecommunications utilities and providers of commercial mobile 
radio services otherwise herein referred to as providers of caller ID. 
(b) Caller identification services ("caller ID"). 
(1) Application. This subsection shall not be construed to apply to: 
(A) an identification service that is used within the same limited system, 
including a central office based PBX-type system; 
(B) information that is used on a public agency's emergency telephone line or on 
a line that receives the primary emergency telephone number (9-1-1): 
(C) information passed between telecommunications utilities, enhanced service 
providers, or other entities that is necessary for the set-up, processing, 
transmission, or billing of telecommunications or related services;
(D) information provided in compliance with applicable law or legal process; or 
(E) an identification service provided in connection with a "700," "800," or 
"900" access code telecommunications service. 
(2) Caller ID blocking. 
(A) Per-call blocking. All providers of caller ID shall provide per-call 
blocking at no charge to each telephone subscriber in the specific area in which 
caller ID is offered. 
(B) Per-line blocking. 
(i) A provider of caller ID may offer and provide per-line blocking to any 
customer at any time without any notification to the commission by the customer 
or the provider. The telecommunications provider is encouraged to notify the 
customer by mail of the effective date that per-line blocking will be 
instituted. 
(ii) All providers of caller ID shall provide per-line blocking at no charge to 
a particular customer in the specific area in which caller ID is offered if the 
commission receives from the customer written certification that the customer 
has a compelling need for per-line blocking. 
(I) When a customer requests per-line blocking through the commission, the 
provider of caller ID shall notify the customer by mail of the effective date 
that per-line blocking will be instituted. 
(II) The commission may prescribe and assess fees and assessments from providers 
of caller ID in an amount sufficient to cover the additional expenses incurred 
by the commission in implementing the customer certification provisions of 
clause (ii) of this subparagraph. 
(III) Reports, records, and information received under clause
(ii) of this subparagraph by the commission or by a provider of caller ID are 
confidential and may be used only for the purposes of administering this 
subparagraph. 
(iii) A provider of caller ID may assess a service order charge relating to 
administrative costs in an amount approved by the commission to reinstate per-
line blocking on a line, if the customer initially received the per-line block 
at no charge and then later asked the provider to remove it. 
(3) Blocking failures and provider responsibilities. When a provider of caller 
ID service to a customer originating a call becomes aware of a failure to block 
the delivery of calling party information from a line equipped with per-line 
blocking or per-call blocking (and the caller had attempted to block the call), 
it shall report such failure to the Caller ID Consumer Education Panel, the 
commission, and the affected customer if that customer did not report the 
failure. The provider shall report such failure to the commission by contacting 
the commission liaison to the panel. A reasonable effort shall be made to notify 
the affected customer within 24 hours after the provider becomes aware of such 
failure. 
(4) Public policy statement. A provider of caller ID services is encouraged to 
inform all of its telephone subscribers of how the subscriber can unblock a line 
equipped with per-line blocking. 
(5) Caller ID Consumer Education Panel. The Caller ID Consumer Education Panel 
shall consist of one person appointed by the Governor, one person appointed by 
the chair of the commission, after consultation with the Texas Council on Family 
Violence, and one person appointed by the Public Counsel of the Office of Public 
Utility Counsel. A commission staff member shall serve as liaison between the 
panel and the commission. 
(A) Role of the Caller ID Consumer Education Panel. The panel shall meet at 
least quarterly to: 
(i) review the level of effort and effectiveness of consumer education 
materials;
(ii) investigate whether educational materials are distributed in as effective a 
manner as marketing materials; and 
(iii) develop recommendations for the commission related to the safe use of 
caller ID services, promotion and preservation of privacy for both the called 
and calling customers, and efforts to decrease the likelihood of harm resulting 
from caller ID services.
(B) Reporting. The panel shall file an annual report with the commission 
detailing its findings and recommendations pursuant to subparagraph (A) of this 
paragraph. The commission may implement the recommendations of the panel, as 
well as those of any interested party, to the extent consistent with the public 
interest. 
(C) Evaluation of the panel. The commission shall evaluate the panel annually. 
The evaluation shall be conducted by an evaluation team appointed by the 
executive director of the commission. The commission liaison, members of the 
panel, and any other commission employee who works either directly or indirectly 
with the panel shall not be eligible to serve on the evaluation team. The 
evaluation team will report to the commission in open meeting each August of its 
findings regarding:
(i) the panel's work; 
(ii) the panel's usefulness; and 
(iii) if the panel is reimbursed for its costs by the state, the costs related 
to the panel's existence, including the cost of agency staff time spent in 
support of the panel's activities. 
(D) Duration of the panel. The panel shall disband on September 1, 1999, unless 
reauthorized by statute. 
(E) Filing of caller ID materials. A provider of caller ID services shall 
provide all existing caller ID materials used as well as all future materials 
(when they become available) as follows: 
(i) One copy of all such material shall be mailed to each member of the panel. 
(ii) Two copies of all such material shall be filed in Central Records under 
Project Number 14505. 
(c) Usage of calling party information in other services. A dominant 
certificated telecommunications utility may not use calling party information to 
allow the called party to contact the calling party, when that calling party had 
indicated a desire for privacy in the initial call by blocking the delivery of 
his or her calling party information through the use of either a per-call or 
per-line blocking option, as those terms are defined in sec.26.5 of this title 
(relating to Definitions).
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt. 
Filed with the Office of the Secretary of State on May 22, 1998.
TRD-9808495
Rhonda Dempsey
Rules Coordinator
Public Utility Commission of Texas
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 936-7308

TITLE 25. HEALTH SERVICES
PART II. Texas Department of Mental Health and Mental Retardation
CHAPTER 403. Other Agencies and the Public
SUBCHAPTER O. Administrative Hearings of the Department in Contested Cases
25 TAC sec.sec.403.451-403.463
(Editor's note: The text of the following sections proposed for repeal will not 
be published. The sections may be examined in the offices of the Texas 
Department of Mental Health and Mental Retardation or in the Texas Register 
office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)
The Texas Department of Mental Health and Mental Retardation (TDMHMR) proposes 
the repeals of sec.sec.403.451 - 403.463 of Chapter 403, Subchapter O, 
concerning administrative hearings of the department in contested cases. New 
sec.sec.411.151 - 411.163 of new Chapter 411, Subchapter D, concerning the same, 
which would replace the repealed sections, are contemporaneously proposed in 
this issue of the Texas Register.
The subchapter describes the procedures for all department administrative 
hearings involving contested cases. The procedures adequately protect the rights 
of all parties involved; are consistent with due process requirements of the 
Texas and federal constitutions; and result in fair and expeditious decisions. 
The sections are proposed for repeal to allow for the adoption of new sections 
concerning the same matter. 
Donald C. Green, Chief Financial Officer, has determined that for each year of 
the first five years the new sections as proposed are in effect there will be no 
additional fiscal implications to state or local government or small businesses. 
Cathy Campbell, director, Legal Services, has determined that for each year of 
the first five years the new sections as proposed are in effect the public 
benefit anticipated is the provision of clear and concise procedures for all 
departmental administrative hearings involving contested cases that adequately 
protect the rights of all parties involved; are consistent with due process 
requirements of the Texas and federal constitutions; and result in fair and 
expeditious decisions. There is no anticipated local employment impact. There is 
no additional economic cost to persons who are required to comply with the 
sections as proposed. 
Written comments on the proposal may be sent to Linda Logan, director, Policy 
Development, Texas Department of Mental Health and Mental Retardation, P.O. Box 
12668, Austin, Texas 78711-2668, within 30 days of publication.
These sections are proposed under the Texas Health and Safety Code, sec.532.015, 
which provides the Texas Mental Health and Mental Retardation Board with broad 
rulemaking authority, and the Texas Government Code, sec.2001.004, which 
requires the department to adopt rules of practice stating the nature and 
requirements of all available formal and informal procedures. 
These sections would affect the Texas Government Code, Chapter 2001, Subchapters 
A, C, D, E, F, and G. 
sec.403.451. Purpose. 
sec.403.452. Applicability and Scope of Rules. 
sec.403.453. Definitions. 
sec.403.454. Administrative Law Judge. 
sec.403.455. Hearing Guidelines. 
sec.403.456. Conduct of Hearings - General Requirements.
sec.403.457. Prehearing Procedure. 
sec.403.458. Evidence and Depositions. 
sec.403.459. Deliberation. 
sec.403.460. Decisions. 
sec.403.461. Judicial Review. 
sec.403.462. Distribution. 
sec.403.463. References. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State on June 1, 1998.
TRD-9808782
Charles Cooper
Chairman
Texas Department of Mental Health and Mental Retardation
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 206-4516

CHAPTER 410. Volunteer Services and Public Information
SUBCHAPTER B. Community Relations
25 TAC sec.sec.410.51-410.76
The Texas Department of Mental Health and Mental Retardation (TDMHMR) propose 
the repeals of sec.sec.410.51-410.76 of Chapter 410, Subchapter B, concerning 
community relations. New sec.sec.417.301-417.316 of new Chapter 417, Subchapter 
G, concerning the same, are contemporaneously proposed in this issue of the 
Texas Register. The repeals would allow for the adoption of new sections.
Donald C. Green, chief financial officer, has determined that for each year of 
the first five years the new sections as proposed are in effect there will be no 
significant fiscal implications to state or local government or small businesses 
as a result of the proposed repeals. 
Jane Hilfer, director, Community Relations, has determined that for each year of 
the first five years the new sections as proposed are in effect the public 
benefit anticipated is the provision of clear and distinct requirements for the 
operation of volunteer programs at facilities and the operation of facilities' 
volunteer services councils which enhance the quantity and quality of services 
provided. There is no anticipated local employment impact. There is no 
anticipated economic cost to persons who are required to comply with the 
sections as proposed. 
Written comments on the proposal may be sent to Linda Logan, director, Policy 
Development, Texas Department of Mental Health and Mental Retardation, P.O. Box 
12668, Austin, Texas 78711-2668, within 30 days of publication.
These sections are proposed under the Texas Health and Safety Code, sec.532.015, 
which provides the Texas MHMR Board with broad rulemaking authority and the 
Texas Government Code, Chapter 2255, which authorizes the adoption of rules 
governing the relationship between certain private organizations and TDMHMR and 
its employees. 
These sections would affect the Texas Government Code, Chapters 2109 and 2255. 
sec.410.51. Purpose. 
sec.410.52. Application. 
sec.410.53. Definitions. 
sec.410.54. General. 
sec.410.55. Direct Service Volunteers: Current Employees; Former Employees. 
sec.410.56. Direct Service Volunteers: Persons Served.
sec.410.57. Direct Service Volunteers: Relatives
of Persons Served; Public Responsibility Committees. 
sec.410.58. Direct Service Volunteers: Standard Interview; Basic Orientation and 
Training; Placement Procedures; Assignment Descriptions; Assessment. 
sec.410.59. Direct Service Volunteers: Age Requirements; Identification; Meals.
sec.410.60. Direct Service Volunteers: Insurance Coverage; Transportation. 
sec.410.61. Awards for Volunteer Services. 
sec.410.62. Direct Service Volunteers: Separation Process; Exit Interview. 
sec.410.63. Direct Service Volunteers: General Guidelines.
sec.410.64. Acceptance of Donations. 
sec.410.65. Donations: Community Solicitations; Undesignated Donations. 
sec.410.66. Capital Improvement Projects; Naming of Donated Gifts, Memorials, or 
Items. 
sec.410.67. Donations: Maintenance of Petty Cash Funds. 
sec.410.68. Fundraising at Local Level. 
sec.410.69. Nonprofit Organizations - Relationship to Department and/or Its 
Facility or CMHMRC. 
sec.410.70. Fundraising at State Level - Texas Foundation on Mental Health and 
Mental Retardation. 
sec.410.71. Volunteer Services State Council (VSSC).
sec.410.72. Auditing Guidelines; Additional Reporting Guidelines. 
sec.410.73. Responsibility of Volunteers to Represent TXMHMR. 
sec.410.74. Exhibits. 
sec.410.75. References. 
sec.410.76. Distribution. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State on June 1, 1998.
TRD-9808784
Charles Cooper
Chairman
Texas Department of Mental Health and Mental Retardation
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 206-4516

CHAPTER 411. State Authority Responsibilities
SUBCHAPTER D. Administrative Hearings of the Department in Contested Cases
25 TAC sec.sec.411.151-411.163
The Texas Department of Mental Health and Mental Retardation (TDMHMR) proposes 
new sec.sec.411.151 - 411.163 of new Chapter 411, Subchapter D, concerning 
administrative hearings of the department in contested cases. The repeals of 
sec.sec.403.451 - 403.463 of Chapter 403, Subchapter O, concerning the same, 
which the new sections would replace, are contemporaneously proposed in this 
issue of the Texas Register. 
The subchapter describes the procedures for all department administrative 
hearings involving contested cases. The procedures adequately protect the rights 
of all parties involved; are consistent with due process requirements of the 
Texas and federal constitutions; and result in fair and expeditious decisions. 
The new sections would implement Senate Bill 637 of the 75th Legislature, which 
amended sec.2001.144 and sec.2001.145 of the Texas Government Code by adding a 
provision for determining when a decision in a contested case is final. 
Donald C. Green, Chief Financial Officer, has determined that for each year of 
the first five years the new sections as proposed are in effect there will be no 
additional fiscal implications to state or local government or small businesses. 
Cathy Campbell, director, Legal Services, has determined that for each year of 
the first five years the new sections as proposed are in effect the public 
benefit anticipated is the provision of clear and concise procedures for all 
departmental administrative hearings involving contested cases that adequately 
protect the rights of all parties involved; are consistent with due process 
requirements of the Texas and federal constitutions; and result in fair and 
expeditious decisions. There is no anticipated local employment impact. There is 
no additional economic cost to persons who are required to comply with the 
sections as proposed. 
Written comments on the proposal may be sent to Linda Logan, director, Policy 
Development, Texas Department of Mental Health and Mental Retardation, P.O. Box 
12668, Austin, Texas 78711-2668, within 30 days of publication.
These sections are proposed under the Texas Health and Safety Code, sec.532.015, 
which provides the Texas Mental Health and Mental Retardation Board with broad 
rulemaking authority, and the Texas Government Code, sec.2001.004, which 
requires the department to adopt rules of practice stating the nature and 
requirements of all available formal and informal procedures. 
These sections would affect the Texas Government Code, Chapter 2001, Subchapters 
A, C, D, E, F, and G. 

sec.411.151. Purpose. 
The purpose of this subchapter governing administrative hearings of the 
department in contested cases is: 
(1) to provide a simple, efficient, and uniform set of procedures for all 
departmental administrative hearings involving contested cases, which will 
adequately protect the rights of all parties involved and will be consistent 
with due process requirements of the Texas and federal constitutions; 
(2) to provide and to ensure uniform standards, practices, and procedures with 
respect to hearings held in connection with such administrative procedures; 
(3) to provide a procedure which will result in fair and expeditious 
determination of causes governed by this subchapter and adequately protect the 
procedural rights of all parties; and 
(4) to fulfill the requirements of the Administrative Procedures Act, Texas 
Government Code, Chapter 2001. 

sec.411.152. Applicability and Scope of Rules. 
(a) The provisions of this subchapter shall apply in all contested cases. 
(b) The provisions of this subchapter shall not be construed so as to enlarge, 
diminish, modify, or alter the jurisdiction, powers, or authority of the 
department or the substantive rights of any person. 
(c) The provisions of this subchapter shall be given a liberal interpretation in 
order that a just, fair, equitable, and impartial judgment of the rights of the 
parties under the established principles of substantive law, as determined by 
appropriate statutes or department rules, may be attained in a timely manner and 
at the least expense to all parties. 

sec.411.153. Definitions. 
The following words and terms, when used in this subchapter, have the following 
meanings unless the context clearly indicates otherwise: 
(1) Administrative hearing or adjudicated hearing - An oral proceeding before 
the department in which the rights and duties of particular persons are judged 
after notice and opportunity to be heard. 
(2) Administrative law judge or ALJ - The attorney designated or appointed by 
the commissioner to conduct and preside over an administrative hearing. 
(3) Commission to examine witnesses - A commission issued to direct the taking 
of depositions of witnesses. 
(4) Commissioner - The commissioner of the Texas Department of Mental Health and 
Mental Retardation or designee. 
(5) Contested case - A proceeding granted by statute for which procedures are 
not otherwise provided for in applicable department rules, including rate making 
or licensing proceedings, in which the legal rights, duties, or privileges of a 
party are to be determined by the department after an opportunity for an 
adjudicated hearing, except in matters related solely to the internal personnel 
policies and procedures of the department.
(6) Days - Calendar days, unless otherwise specified.
(7) Decision - A decision made by the ALJ regarding the administrative hearing 
over which the ALJ is presiding. 
(8) Default judgment - A judgment entered against a party who has failed to 
appear at the administrative hearing. 
(9) Department - The Texas Department of Mental Health and Mental Retardation 
(TXMHMR) or its designee. 
(10) Exception - A party's objection to an order or ruling.
(11) Findings of fact - Determinations from the evidence submitted in the case 
concerning facts asserted by one party and denied by another. 
(12) Hearings Office - The Legal Services Division of the department's central 
office. 
(13) Interrogatories - A discovery device consisting of written questions about 
the proceeding submitted by one party to another party or witness. 
(14) Motion - A request made to the administrative law judge for the purpose of 
obtaining a ruling or order directing some act to be done in favor of the 
movant. 
(15) Movant - The party making a motion. 
(16) Order - A command for action by the administrative law judge as a result of 
a ruling or decision. 
(17) Party - Each person or agency named or admitted as a party, pursuant to 
department rules and statutes under which such hearings are requested or held. 
(18) Person - An individual, partnership, corporation, association, governmental 
subdivision, or a public or private organization of any character other than the 
department. 
(19) Person receiving services or person served by the department - A person who 
is receiving mental health or mental retardation services funded by or through 
the department. 
(20) Pleadings - Written statements filed by parties concerning their respective 
positions, claims, and rights in administrative hearings, (e.g., applications, 
objections, petitions, complaints, answers, replies, motions, etc.). 
(21) Preponderance of the evidence - Evidence which is of greater weight or more 
convincing than the evidence which is offered in opposition to it. 
(22) Proceeding - The regular and orderly progress in form of law, including all 
possible steps in an action from its beginning to the final decision. A 
proceeding includes, but is not limited to, the initiating document, 
certificates of service, pleadings, motions, orders, prehearing conference, 
hearing, the record, rulings, decisions, evidence, testimony, and exhibits. 
(23) Proposed findings of fact - Findings of fact as proposed by a party. 
(24) Texas Rules of Civil Procedure - Those rules adopted by the Texas Supreme 
Court which govern procedure in state courts involving all civil suits. 
(25) Texas Rules of Civil Evidence - Those rules adopted by the Texas Supreme 
Court which govern the admissibility of evidence in state courts involving all 
civil suits. 
(26) Privileged information - Information (i.e., communications, written or 
verbal, made by persons with a protected relationship such as husband/wife, 
attorney/client, doctor/patient, priest/penitent, etc.) which the law protects 
from forced disclosure at the option of the spouse, client, patient, penitent, 
etc. 
(27) Ruling - A judicial determination by the administrative law judge of the 
admissibility of evidence, allowance of a motion, etc. 
(28) Serve, serve upon, serve notice, service - To mail or deliver a copy of a 
designated document to a party or to the party's attorney/representative, if 
any.
(29) Statute - State or federal law. 
(30) Summary judgment - A judgment entered when there is no genuine issue of 
material fact and a party is entitled to judgment as a matter of law. 
(31) Trial de novo - A new trial held as if no administrative hearing had been 
held. 
(32) With prejudice - Refusal of the ALJ to accept the refiling of a pleading or 
request for an administrative hearing. 

sec.411.154. Administrative Law Judge. 
An administrative law judge is an attorney appointed by the commissioner or 
designee who conducts the proceeding. An attorney who has, directly or 
indirectly, participated in or given advice on issues that are the basis for a 
particular hearing may not be the administrative law judge in that hearing. 

sec.411.155. Hearing Guidelines. 
(a) Requesting an administrative hearing. A written request for an 
administrative hearing must be filed with the Hearings Office addressed to: 
Hearings Office, TXMHMR, P.O. Box 12668, Austin, TX 78711-2668. Upon the receipt 
of the written request for an administrative hearing which complies with this 
subchapter as to form and content, the Hearings Office shall docket the document 
as a pending proceeding. 
(b) Administrative hearing date. If the ALJ determines that the written request 
was filed within the time frames specified in applicable department rules and 
statutes, the ALJ shall select an administrative hearing date. 
(1) The administrative hearing date shall be no sooner than 20 days nor later 
than 45 days after the written request is received by the Hearings Office, 
unless otherwise provided in department rules or statutes.
(2) After the administrative hearing date has been set, the ALJ may subsequently 
postpone or continue the administrative hearing date until a later date if, in 
the ALJ's discretion, good cause requires a later date. Good cause includes, but 
is not limited to, the consideration that a later date will result in a fairer 
and more just determination of the issues and that the welfare of any person 
served by the department will not be substantially endangered by reason of the 
postponement. The ALJ is not precluded from ordering a postponement or 
continuance of the hearing upon the showing of good cause. 
(c) Notice of an administrative hearing. In a contested case all parties shall 
be afforded an opportunity for an administrative hearing after reasonable 
notice. At least 20 days before the administrative hearing date, the ALJ must 
serve written notification to the department and the party who requested the 
hearing. A copy of this subchapter must accompany the written notification sent 
to the parties involved in the administrative hearing. The ALJ may mail notice 
by certified or registered mail to the last known place of address of the person 
entitled to receive such notice or may hand-deliver such notice. Notice shall be 
delivered in the manner most likely to assure prompt receipt. Notice shall 
include: 
(1) a statement of the time, place, and nature of the administrative hearing; 
(2) a statement of the legal authority and jurisdiction under which the hearing 
is to be held; 
(3) reference to the particular sections of the statutes and rules involved; and 
(4) a short and plain statement of the action complained of by the party 
requesting the administrative hearing. 
(d) Statement of issues. After a timely written motion from the department's 
representative, the ALJ may require the party requesting the administrative 
hearing to deliver to the department representative a concise written statement 
of the issues, statutes, and rules asserted by that party. This statement must 
be delivered at least 10 days before the administrative hearing date. 
(e) Nature of the administrative hearing. All hearings conducted in any 
proceedings shall be opened to the public, but may be ordered to be closed upon 
a finding of the ALJ of possible breach of confidentiality of persons receiving 
services. 
(f) Location of the administrative hearing. All hearings shall be held in 
Austin, Texas, in the case of proceedings arising out of actions, events, or 
omissions alleged to have been taken by the central office of TXMHMR; and at the 
location of each facility of the department, in the case of proceedings arising 
out of actions, events, or omissions alleged to have been taken by that 
facility, unless for good and sufficient cause, in which case the ALJ, in the 
ALJ's discretion, shall designate another place to hold the hearing which would 
be in the interest of the public. 
(g) Representation. 
(1) Parties may appear on their own behalf, be represented by an attorney, or by 
a lay representative of the party's choosing. 
(2) The commissioner shall appoint an attorney and/or appropriate program staff 
to represent the department in contested cases.
(h) Filing of Documents. All documents relating to any proceeding which is 
pending must be submitted to the ALJ with a copy served upon each party under a 
certificate of service as described in subsection (l) of this section. The 
documents shall be considered filed only when actually received by the ALJ 
accompanied by the filing fee, if any, required by statute or department rules. 
(i) Agreements between parties. No stipulation or agreement between the parties, 
their attorneys/representatives, with regard to any matter involved in any 
proceeding, shall be in force unless: 
(1) it is in writing and signed by the parties involved or their 
attorneys/representatives; or 
(2) it has been dictated into the record by the parties involved during the 
course of a hearing; or incorporated in an order with their written approval. 
This subsection does not limit a party's ability to waive, modify, or stipulate 
any right or privilege provided by this subchapter.
(j) Pleadings. Pleadings shall be submitted to the ALJ. 
(1) Pleadings shall be typewritten or printed with exhibits, if any, attached. 
Copies of pleadings are acceptable, provided all copies are clear and 
permanently legible. The original of every pleading shall:
(A) be signed in ink by the party filing the pleading or by the party's 
attorney/representative; 
(B) contain the address of the party filing it; and 
(C) contain the name, telephone number, and business address of the party's 
attorney/representative, if any. 
(2) Pleadings shall include: 
(A) the name of the party requesting the administrative hearing;
(B) the names of any other known parties; 
(C) a statement of the pleading's objective which contains a concise statement 
of facts in support of the objective; 
(D) the relief, action, or order sought by the pleader and the specific reasons 
and grounds for such; 
(E) any matter required by other rules of the department with respect to the 
proceeding; 
(F) the certificate of service as described in subsection (l) of this section; 
and
(G) an affidavit(s) if based upon matters which do not appear on the record. 
(3) Upon submission of any pleading to the ALJ, it shall be examined by the ALJ 
to determine its sufficiency under this subchapter. While a liberal 
interpretation shall be to be given to all pleadings, if the pleading does not 
comply with this subchapter, it shall be returned to the person filing it along 
with the statement by the ALJ of the reason for rejecting it. A corrected 
pleading may then be filed if it will not unduly delay the hearing. Regardless 
of any error in the identification of a pleading, its true status shall be 
recognized. 
(4) In order to amend its pleading, a party must file a motion, no later than 
five days before a hearing, and obtain a ruling by the ALJ. 
(5) Any party who submits a pleading to the ALJ after a request for an 
administrative hearing has been filed must, at the same time, serve a copy of 
the pleading upon all other parties or their attorney/representative, if any, 
under a certificate of service. The willful failure of any party to make such 
service shall be sufficient grounds for the ALJ to enter an order striking the 
pleading from the record. 
(6) All pleadings must be filed no less than five days prior to the 
administrative hearing date. 
(7) Any pleading may adopt and incorporate by specific reference any part of any 
document or entry in the official files and records of the department. 
(k) The ALJ may direct that one or more of the following be transmitted by each 
party to all other parties or their attorney/representative, and to the ALJ, by 
the date established by the ALJ: 
(1) a list of witnesses the party desires to testify and a brief narrative 
summary of their expected testimony; 
(2) a written statement of the disputed issues for consideration at the hearing; 
(3) a copy of any written statements to be offered at the hearing; or 
(4) a copy of other written testimony or documentary evidence the party intends 
to use at the hearing. 
(l) Certificate of service. A certificate by the party or the party's 
attorney/representative who submits a pleading stating that it has been served 
upon the other parties or their attorney/ representative will be sufficient 
proof of such service. The following form of certificate is sufficient: "I 
hereby certify that I have, on this __________ day of __________ , 19__, served 
copies of the attached document upon all other parties to this proceeding by 
____________________ (state here the type of delivery/service). (signature)"
(m) Computing timeframes. The following procedure is to be used to compute any 
period of time governing hearings procedures and which is allowed or prescribed 
by this subchapter or by order of the ALJ: the period shall begin on the day 
after the act, event, default, or controversy and conclude on the last day of 
such computed period, unless that day is a Saturday, Sunday, or legal holiday, 
in which case the period runs until the end of the next day which is neither a 
Saturday, Sunday, nor legal holiday. 
(n) Extension of timeframes. The time for the doing of any act may be extended 
by order of the ALJ, upon written motion submitted to the ALJ prior to the 
expiration of the period of time for the doing of such act, showing that there 
is good cause for such extension of time and that the need is not caused by 
neglect, indifference, or lack of diligence of the movant. A copy of the written 
motion shall be served upon all other parties to the proceeding at the same time 
that it is submitted to the ALJ.

sec.411.156. Conduct of Hearings - General Requirements. 
(a) The ALJ shall be in charge of proceedings. The ALJ has the authority to: 
(1) administer oaths or affirmations; 
(2) examine witnesses; 
(3) issue subpoenas and commissions; 
(4) rule on admissibility of evidence and amendments to pleadings; 
(5) conduct hearings on motions and other pleadings;
(6) establish reasonable time limits for conducting hearings;
(7) request additional information; and 
(8) issue any orders necessary to enforce the ALJ's rulings, which include, but 
are not limited to: 
(A) exclusion of evidence or witnesses; 
(B) exclusion of oral argument; 
(C) continuance or dismissal of the hearing with or without prejudice; and 
(D) summary or default judgment on any issues. 
(b) The department has the burden of proof in all contested cases. 
(c) At the discretion of the ALJ, a hearing may be conducted by 
telephone/teleconference. 
(d) Subject to the ALJ's rulings and orders, opportunity shall be given to all 
parties to respond to and present evidence and argument on all issues involved.
(e) Subject to limits set by the ALJ, all parties shall have an opportunity to 
call any witnesses desired. 
(f) If a party or the party's attorney/ representative is notified of the 
hearing and neither is present at the hearing, all matters stated in evidence 
introduced at the hearing may be considered as undisputed by the party failing 
to appear. 
(g) The ALJ may entertain motions for the dismissal of a contested case without 
a hearing for any of the following reasons: 
(1) failure of the party who requested the administrative hearing to go forward 
with the proceeding within a reasonable period of time;
(2) unnecessary duplication of proceedings; 
(3) withdrawal from the proceeding by the party who requested the administrative 
hearing; 
(4) moot issues; and 
(5) lack of departmental jurisdiction. 
(h) A record shall be made of the proceedings and include:
(1) all pleadings, motions, and intermediate rulings; 
(2) evidence received or considered; 
(3) a statement of matters officially noticed; 
(4) objections and the rulings on them; 
(5) proposed findings of fact and exceptions; 
(6) any decision, order, opinion, or report made by the ALJ; and 
(7) all department staff memoranda or data submitted to or considered by the ALJ 
in making the final decision. 
(i) Exhibits. 
(1) The original of each exhibit offered shall be submitted to the ALJ for 
identification and a copy served to each party. 
(2) In the event an exhibit has been identified, objected to, and excluded, the 
ALJ shall return the exhibit to the offering party.
(3) No exhibit will be permitted to be submitted after the conclusion of the 
hearing, unless specifically directed by the ALJ. In the event the ALJ allows 
the exhibit to be submitted after the completion of the hearing, copies of the 
late-filed exhibit shall be served upon all parties. 
(j) All hearings shall be recorded either stenographically or electronically at 
the department's expense. The ALJ shall decide whether a stenographic record or 
an electronic recording will be made and shall make the necessary recording 
arrangements accordingly. If requested by the ALJ, the hearing must be 
transcribed, at the department's expense, with a transcript given to the ALJ. 
The costs associated with recording the hearing may be assessed to one or more 
parties if a recording method, other than the one chosen by the ALJ, is 
requested by the party or parties. If a party wants a transcript of the hearing, 
that party must pay all costs associated with providing the transcript.
(k) Parties to the hearing may conduct cross-examination for a full and true 
disclosure of the facts. 
(l) Before or during the hearing, the ALJ may call or request any party to call 
a witness or witnesses the ALJ believes necessary to make the final decision. 
(m) The ALJ may not communicate directly or indirectly in connection with any 
issue of fact or law with any person, party, or their attorney/representative, 
except after serving notice which provides an opportunity for all parties to 
participate. The ALJ may communicate with other members of the department who 
have not participated in the proceeding of the contested case for the purpose of 
utilizing the special skills or knowledge of the department's staff in 
evaluating the evidence in accordance with the Texas Government Code, 
sec.2001.061 and sec.411.158(a)(4) of this title (relating to Evidence and 
Depositions). 
(n) In all procedural matters not specifically governed by these sections, the 
Texas Rules of Civil Procedure shall apply unless the ALJ determines there is 
good cause for waiving any and all such rules. 
(o) Records of the hearing shall be kept in department files for four years 
after a final decision is made or until any subsequent litigation arising from 
the hearing has been resolved. 
(p) In any hearing or other proceedings conducted by the department, the 
identity of an individual with mental illness or mental retardation shall be not 
be revealed or made a matter of public record in any way unless the person who 
has the right of confidentiality waives that right in open hearing or the party 
or person desiring or attempting to reveal the identity of such individual has: 
(1) established to the satisfaction of the ALJ that the identity of the 
individual with mental illness or mental retardation is relevant and material to 
an issue in the hearing; and 
(2) secured from the individual with mental illness or mental retardation or the 
person legally authorized to give consent for such individual written consent to 
reveal, for the purposes of the proceeding, the identity of such individual, and 
the specific information to be revealed is set forth in such written consent, 
and such written consent has been filed with the ALJ. 
(q) If consent to reveal the identity of an individual with mental illness or 
mental retardation cannot be obtained due to the individual's incompetence or 
lack of a legal guardian, then: 
(1) the ALJ must close the hearing to the public; and 
(2) any transcript of the record may not identify such individual, but may 
contain a pseudonym to refer to the individual. 
(r) Any attempt by a party to circumvent the requirements of subsection (p) of 
this section shall be sufficient grounds for the ALJ to strike the pleading of 
the party from the record or to dismiss the hearing with prejudice. 
(s) At all hearings, each party, witness, attorney/representative, or other 
person must show proper dignity, courtesy, and respect for the ALJ and others 
participating in or observing the hearing. The ALJ is authorized to act as the 
ALJ considers necessary and appropriate to maintain proper decorum and conduct. 
Actions may include, but are not limited to, recessing the hearing to be 
reconvened at another time or place or excluding from the hearing any party, 
witness, attorney/ representative, or other person for a period and under the 
conditions that the ALJ considers fair and just. The ALJ, attorneys of parties 
shall observe and practice the standards of ethical behavior prescribed for 
attorneys at law by the State Bar of Texas. 

sec.411.157. Prehearing Procedure.
(a) Prehearing conference. 
(1) In any proceeding governed by this subchapter, the ALJ, on the ALJ's own 
motion or on the motion of any party, may direct the parties or their 
attorneys/representatives to appear before the ALJ or participate by 
telephone/teleconference at a specified time and place for a conference prior to 
the administrative hearing date for the purpose of considering:
(A) the possibility of making admissions of facts or stipulations to avoid the 
unnecessary introduction of proof; 
(B) the simplification of issues; 
(C) the procedure at the hearing; 
(D) the limitation, when possible, of the number of witnesses; and 
(E) such other matters as may aid in the simplification of the proceedings and 
the disposition of the matters in controversy, including settlement of such 
issues as are in dispute. 
(2) Actions taken at the conference shall be recorded in an order by the ALJ 
unless the parties enter into a written agreement, incorporating issues 
addressed at the prehearing conference, signed by the parties involved or their 
attorney/ representative. 
(b) Joint hearing. A motion for the consolidation of two or more proceedings 
shall be in writing, signed by the party making the motion or that party's 
attorney/representative, and submitted to the ALJ at least five days prior to 
the administrative hearing date. Two or more proceedings may not be consolidated 
or heard jointly without the agreement of all parties to such proceedings, 
unless the ALJ finds that: 
(1) the two or more proceedings involve common questions of law and fact; and 
(2) separate hearings would result in unwarranted expense, delay, or substantial 
injustice. 
(c) Discovery and production of documents and things for inspection, copying, or 
photographing. In all discovery matters not specifically governed by these 
sections, the Texas Rules of Civil Procedure shall be followed.
(1) Upon the timely motion of any party showing good cause, with notice served 
upon all other parties, and subject to any limitation provided for discovery 
under the Texas Rules of Civil Procedure, the ALJ may order any party to: 
(A) produce and permit the inspection and copying or photographing by or on 
behalf of the movant any of the following items that are in the party's 
possession, custody, or control and not considered privileged information, as 
defined in sec.411.153 of this title (relating to Definitions), which constitute 
or contain, or are reasonably calculated to lead to the discovery of, evidence 
material to any matter involved in the action: 
(i) documents; 
(ii) papers; 
(iii) books; 
(iv) accounts; 
(v) letters; 
(vi) photographs; 
(vii) objects; and 
(viii) tangible things. 
(B) permit entry upon designated land or other property in the party's 
possession or control for the purpose of inspecting, measuring, surveying, or 
photographing the property or any specific object or operation which may be 
relevant to any matter involved in the action. 
(2) The ALJ shall limit the order described in paragraph (1) of this subsection, 
as justice may require, to protect any party or witness from undue annoyance, 
embarrassment, oppression, or expense. The order must specify the time, place, 
and manner of making the inspection, measurement, or survey and taking the 
copies and photographs and may prescribe such terms and conditions as are just. 
(3) The identity and location of any potential party or witness may be obtained 
from any communication or other paper in a party's possession, custody, or 
control. Any party may be required to produce and permit the inspection and 
copying of reports, including factual observations and opinions of an expert to 
be called as a witness. The rights granted in this paragraph may not extend to 
other written statements of witnesses or other written communication passing 
between agents, representatives, or the employees of any party to the proceeding 
or to other communications between any party and the party's agents, 
representatives, or other employees, that were made subsequent to the occurrence 
or transaction upon which the proceeding is based, and made in connection with 
the prosecution, investigation, or defense of such claim or the circumstances 
out of which the claim arose. 
(d) Statement previously made. Any person, whether or not a party, shall be 
entitled to obtain, upon request, a copy of any statement that person has 
previously made concerning the occurrence or transaction upon which the 
proceeding is based which is in the possession, custody, or control of any 
party. If the request is refused, the person may make a motion for a 
departmental order to obtain a copy of the statement. For the purposes of this 
subsection, a statement previously made is: 
(1) a written statement signed or otherwise adopted or approved by the person 
making it; or 
(2) a stenographic, mechanical, electrical, or other recording or a 
transcription of the same statement, which is a substantially verbatim recital 
of an oral statement by the person making it and which is recorded at the same 
time.
(e) Admission of facts and of genuineness of documents. After a request for an 
administrative hearing has been filed any party may deliver or have delivered to 
any other party a written request for admission of facts and genuineness of 
documents. The provisions of Rule 169 of the Texas Rules of Civil Procedure 
govern, except that filing and enforcing shall be controlled by the ALJ. 
(f) Interrogatories to parties. After a request for an administrative hearing 
has been filed any party may serve interrogatories upon any other party. The 
provisions of Rule 168 of the Texas Rules of Civil Procedure govern, except that 
filing and enforcing shall be controlled by the ALJ. 

sec.411.158. Evidence and Depositions.
(a) Evidentiary procedures. 
(1) The Texas Rules of Civil Evidence shall apply except as follows: 
(A) Irrelevant, immaterial, or unduly repetitious evidence shall be excluded. 
(B) Evidence inadmissible under those rules may be admitted if the evidence is: 
(i) necessary to ascertain facts not reasonably susceptible of proof under those 
rules; 
(ii) not precluded by statute; and 
(iii) of a type on which a reasonably prudent person commonly relies in the 
conduct of the person's affairs. 
(C) Any part of the evidence may be received in written form if a hearing will 
be expedited and if the parties' interest will not be substantially prejudiced. 
(2) Objections to offers of evidence may be made and shall be noted in the 
record. 
(3) The prepared testimony of a witness upon direct examination, either in 
narrative or question-and-answer form, may be incorporated in the record as if 
read or received as an exhibit after the witness has been sworn and has 
identified that the prepared testimony is as true and accurate as the witness's 
oral testimony would be. The witness is subject to clarifying questions and to 
cross-examination. The prepared testimony may not be stricken from the record in 
whole or in part. 
(4) Documentary or written evidence may be received in the form of copies or 
excerpts if the original is not readily available. On request, parties shall be 
given an opportunity to compare the copy with the original. 
(5) Official notice may be taken of all facts judicially known. In addition, 
notice may be taken of generally recognized facts within the area of the 
department's specialized knowledge. Parties shall be notified either before or 
during the hearing, or by reference in preliminary reports or otherwise, of the 
material officially noticed, including any staff memoranda or data. Parties 
shall be given an opportunity to contest the material so noticed. 
(6) All testimony in a hearing by a witness shall be taken under oath or 
affirmation as prescribed by law. 
(7) The department or any other party may apply for permission to obtain the 
testimony of a witness by telephone when it is impossible or impractical to 
obtain the physical presence of a witness in the hearing room due to the 
witness's age, illness, custodial restrictions, or residence more than 100 miles 
from the site of the hearing. 
(A) Application for permission to secure testimony by telephone shall be 
submitted to the ALJ with a copy sent to other parties at least 10 days prior to 
the hearing. The application must state the reasons for the request. If the ALJ 
finds that good cause exists to permit testimony to be obtained by telephone, 
the ALJ must grant the application and immediately advise the parties. The ALJ 
must rule on the application at least five days prior to the hearing. 
(B) If testimony by telephone is allowed, the hearing room must be equipped with 
a speaker phone or other telephone equipment which will allow everyone present 
to hear the testimony of the witness simultaneously and will also allow the 
witness to hear all parties and the ALJ. The testimony by telephone provided by 
a witness shall be taken under oath or affirmation as if the witness were 
physically present at the hearing. 
(8) If a party or witness is deaf, the department shall provide an interpreter 
whose qualifications are approved by the State Commission for the Deaf and 
Hearing Impaired to interpret the proceedings for that party or witness. In this 
paragraph, "person who is deaf" means a person who has a hearing impairment, 
whether or not the person also has a speech impairment, that inhibits the 
person's comprehension of the proceedings or communication with others. 
(9) If a party or witness speaks a language other than English, the department 
shall provide an interpreter of the language spoken by the party or witness. 
(b) Subpoenas. The department shall have the powers of subpoena granted under 
the Texas Government Code, sec.2001.089. The department shall, on its own motion 
or on the written motion of any party, on a showing of good cause, and on the 
monetary deposit of sums which will reasonably ensure payment of the amounts 
estimated to accrue, issue a subpoena in accordance with law to require the 
attendance of witnesses and the production of documents as may be necessary and 
proper for the purposes of the proceedings before it. 
(c) Commissions/depositions. The issuance of commissions toexamine witnesses and 
the taking of depositions shall be in accordance with the provisions of the 
Texas Government Code, sec.sec.2001.094-.103.
(d) Requests for commissions or subpoenas. Requests for commissions or subpoenas 
shall be submitted to the ALJ. 

sec.411.159. Deliberation. 
After all evidence has been heard, the ALJ shall adjourn the hearing. Within 60 
days from the date of adjournment, the ALJ shall make a final decision in the 
contested case. The ALJ may prescribe a longer period of time within which the 
final decision or order shall be issued, but such extension, if so prescribed, 
shall be announced at the completion of the hearing, but in no event shall be 
longer than 90 days unless a longer period of time is agreed on by all parties 
to the proceeding. 

sec.411.160. Decisions. 
(a) The administrative hearing decision of the ALJ shall be based solely upon 
the record of the contested case. The decision shall be in writing and include 
the findings of fact and conclusions of law separately stated. 
(b) Issues must be proven by a preponderance of the evidence.
(c) Findings of fact must be accompanied by a concise and explicit statement of 
the underlying facts supporting the findings. 
(d) Findings of fact must be based exclusively on the evidence and on matters 
officially noticed. If a party submits a proposed finding of fact, the decision 
must include a ruling on each proposed finding. 
(e) The ALJ shall enter into the record orders that are necessary to implement 
the administrative hearing decision. The ALJ may also make other recommendations 
as the ALJ considers appropriate. 
(f) The following provisions determine when an administrative hearing decision 
in a contested case is final. 
(1) If a motion for a rehearing is not filed in the time frame as described in 
subsection (h) of this section, the administrative hearing decision is final on 
the expiration of the period for filing a motion for a rehearing. 
(2) If a motion for a rehearing is filed in the time frame described in 
subsection (h) of this section, the administrative hearing decision is final and 
appealable through a judicial review on the date: 
(A) the order overruling the motion for a rehearing is made; or 
(B) the motion is overruled by operation of law. 
(3) If the ALJ finds that an imminent peril to the public health, safety, or 
welfare requires immediate effect of a decision, the administrative hearing 
decision is final on the date the decision is made. In this event, the ALJ must 
recite or record into the record the finding of such imminent peril as well as 
the fact that the decision is final and effective on the date recited or 
recorded into the record. The final decision is appealable on the date recited 
or recorded into the record and no motion for rehearing is required as 
prerequisite for an appeal. 
(4) A decision in a contested case is final on the date specified in the order 
for a case in which all parties agree to the specified date in writing or on the 
record, if the specified date is not before the date the order is signed or 
later than the 20th day after the order was made.
(g) The ALJ shall send the administrative hearing decision by first class 
certified mail, return receipt requested, to the attorneys/representatives, or, 
if a party is not represented by an attorney/ representative, to that party. The 
ALJ shall keep an appropriate record of that mailing. A party or 
attorney/representative notified by mail of an administrative hearing decision 
is presumed to have been notified on the date such notice is mailed. 
(h) Any party may file a written motion for rehearing. The motion must be 
addressed to the ALJ and must be filed so that it is received by the ALJ within 
20 days after the date the administrative hearing decision was mailed to the 
party or the party's attorney/representative. Replies to a motion for rehearing 
from other parties involved must be filed so as to be received by the ALJ within 
30 days after the date of mailing of the administrative hearing decision. The 
ALJ shall either grant or deny the motion for rehearing within 45 days after the 
date the administrative hearing decision was mailed. If the ALJ does not rule on 
the motion for rehearing, the motion is overruled by operation of law 45 days 
after the date the administrative hearing decision was mailed. 
(i) The period of time for the filing of motions for rehearing and replies may 
be extended by written order of the ALJ but such extension may not extend the 
period for action beyond 90 days after the date the administrative hearing 
decision was mailed. In the event of extension, if the ALJ does not rule on a 
motion for a rehearing, the motion for rehearing is overruled by operation of 
law on the date prescribed in the extension order, or in the absence of a 
prescribed date, 90 days after the date the administrative hearing decision was 
mailed. 

sec.411.161. Judicial Review.
(a) Unless otherwise specifically provided by statute, a party who has exhausted 
all administrative remedies available within department rules and who is 
dissatisfied with a final decision in a contested case is entitled to a judicial 
review. 
(b) Proceedings for a judicial review are initiated by filing a petition within 
30 days after the decision complained of is final and appealable. Unless 
otherwise provided by statute, the petition must be filed in a district court of 
Travis County, Texas. A copy of the petition must be served upon the department 
and all parties involved in the administrative hearing. 
(1) The filing of the petition prevents enforcement of a final decision or order 
for which trial de novo is the manner of review authorized by law. If the manner 
of review authorized by law is by trial de novo, then the reviewing court shall 
try all issues of fact and law in a manner applicable to other civil suits in 
the state. 
(2) The filing of the petition does not prevent enforcement of a final decision 
or order if the manner of review authorized by law is other than trial de novo. 
If the manner of review authorized by law is other than by trial de novo and, in 
the absence of other specific statutory provisions, the provisions of the Texas 
Government Code, sec.2001.175 shall be applicable.

sec.411.162. References. 
Reference is made to the following statutes: 
(1) Texas Government Code, Chapter 2001; 
(2) Texas Rules of Civil Procedure; and 
(3) Texas Rules of Civil Evidence. 

sec.411.163. Distribution. 
This subchapter governing administrative hearings of the department in contested 
cases shall be distributed to: 
(1) members of the Texas Board of Mental Health and Mental Retardation; 
(2) the commissioner and deputy commissioners; 
(3) associate and assistant deputy commissioners; 
(4) management and program staff of the central office;
(5) superintendents/directors of all department facilities;
(6) persons designated as administrative law judges;
(7) upon request, any party to an administrative hearing conducted under this 
subchapter; and 
(8) advocacy organizations. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State on June 1, 1998.
TRD-9808781
Charles Cooper
Chairman
Texas Department of Mental Health and Mental Retardation
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 206-4516

CHAPTER 417. Agency and Facility Responsibilities
SUBCHAPTER G. Community Relations
25 TAC sec.sec.417.301-417.316
The Texas Department of Mental Health and Mental Retardation (TDMHMR) proposes 
new sec.sec.417.301-417.316 of new Chapter 417, Subchapter G, concerning 
community relations. The repeals of sec.sec.410.51-410.76 of Chapter 410, 
Subchapter B, concerning the same, are contemporaneously proposed in this issue 
of the Texas Register.
It is imperative that all department volunteer service programs and non-profit 
organizations that exist to generate revenue for the department and its 
facilities be administered with the highest ethical and professional conduct. To 
this end, the department proposes rules for its employees and volunteers that 
ensure the coordination of activities and efforts of such volunteer service 
programs and non-profit organizations. 
The subchapter describes the requirements for the operation of volunteer 
programs at facilities of the department; describes requirements by which 
facilities and their volunteer services councils, which generate resources on a 
facility's behalf, are to operate; and describes requirements for fundraising 
activities, soliciting donations, and receiving donations at facilities and 
state-operated community services. 
Donald C. Green, chief financial officer, has determined that for each year of 
the first five years the new sections as proposed are in effect there will be no 
additional fiscal implications to state or local government or small businesses 
as a result of administering the sections as proposed because the sections 
represent a reorganization of the provisions contained in the existing 
subchapter, which is proposed for repeal. Estimated costs to the department 
related to enforcement of the proposed new sections are negligible and offset by 
reducing review related tasks performed by governmental personnel. The proposed 
new sections will require certain volunteer services councils (VSC) to provide 
the department with financial information that has undergone a review process. 
Based on an average cost of $500 for an annual financial review compilation, 
which would have been required of two VSCs in 1997, the department estimates the 
cost to be $1000 for every year the financial review compilation is performed. 
Every third year all VSCs are required to undergo a full audit. This eliminates 
the need for a review compilation for those VSCs affected by the proposal. 
Jane Hilfer, director, Community Relations, has determined that for each year of 
the first five years the new sections as proposed are in effect the public 
benefit anticipated is the adoption of clear and distinct requirements for the 
operation of volunteer programs at facilities and the operation of facilities' 
volunteer services councils which enhance the quantity and quality of services 
provided. There is no anticipated local employment impact.
Written comments on the proposal may be sent to Linda Logan, director, Policy 
Development, Texas Department of Mental Health and Mental Retardation, P.O. Box 
12668, Austin, Texas 78711-2668, within 30 days of publication.
These sections are proposed under the Texas Health and Safety Code, sec.532.015, 
which provides the Texas MHMR Board with broad rulemaking authority and the 
Texas Government Code, Chapter 2255, which authorizes the adoption of rules 
governing the relationship between certain private organizations and TDMHMR and 
its employees. 
These sections would affect the Texas Government Code, Chapters 2109 and 2255. 

sec.417.301. Purpose. 
The purpose of this subchapter is to delineate department policy and establish 
uniform operating standards for volunteer services and fundraising at the Texas 
Department of Mental Health and Mental Retardation. 

sec.417.302. Application. 
(a) This subchapter applies to all facilities and Central Office of the Texas 
Department of Mental Health and Mental Retardation. 
(b) The following portions of this subchapter apply to state-operated community 
services (SOCS) of the Texas Department of Mental Health and Mental Retardation: 
(1) sec.417.301; 
(2) sec.417.302; 
(3) sec.417.303; 
(4) sec.417.304(a), (c), (d), (e), (f), (g), (h), and (i), and sec.417.305, if a 
SOCS operates a volunteer program; 
(5) sec.417.306; 
(6) sec.417.308; 
(7) sec.417.309(a)(2) and (b); 
(8) sec.417.310; 
(9) sec.417.313(a) and (b); and 
(10) sec.417.316(b). 

sec.417.303. Definitions. 
The following words and terms, when used in this subchapter, have the following 
meanings, unless the context clearly indicates otherwise. 
(1) Cash - Currency, checks, drafts, money orders, and other forms of legal 
tender. 
(2) Chief executive officer (CEO) - The superintendent/director of a state 
facility or the executive director of a state-operated community services 
(SOCS). 
(3) Commissioner - The commissioner of the Texas Department of Mental Health and 
Mental Retardation. 
(4) Community relations staff - The staff who manage the volunteer programs and 
oversee volunteer fundraising activities at a facility or SOCS. 
(5) Department - The Texas Department of Mental Health and Mental Retardation 
(TDMHMR). 
(6) Direct contact - An assignment which involves working with persons served. 
(7) Director of community relations - The employee responsible for coordinating 
the community relations functions and volunteer programs at a facility or SOCS. 
(8) Donation - A contribution of anything of value (e.g., funds or in-kind goods 
and services) freely given to a VSC, facility, or SOCS. 
(9) Donor - An individual, group, or organization that makes a donation. 
(10) Employee - An individual who is legally employed to perform work and who is 
paid a salary or wage by a facility, SOCS, or Central Office. 
(11) Facility - A state school, state hospital, or state center of the 
department. 
(12) 501(c)(3) organization - An organization recognized by the Internal Revenue 
Service as a nonprofit corporation and granted the right to receive tax 
deductible contributions under sec.501(c)(3) of the Internal Revenue Code. 
(13) Long Term Friendship - A personal friendship between an employee and a 
specific person served which developed over a period of time. The authenticity 
of the friendship is verified by the appropriate professional, based upon the 
quality and duration of the relationship. 
(14) Office of Community Relations, Central Office - The Central Office 
department responsible for providing support to statewide community relations 
programs, including volunteer services, nonprofit management, and fundraising. 
(15) Person served - A person receiving mental health or mental retardation 
services from the department. 
(16) State-operated community services (SOCS) - Community residential and 
nonresidential programs operated by the department. 
(17) TDMHMR - The Texas Department of Mental Health and Mental Retardation. 
(18) Texas Foundation for Mental Health and Mental Retardation - A nonprofit 
organization which exists to generate resources on behalf of TDMHMR. 
(19) Visiting group - A group of varying individuals associated with an 
organization (e.g., civic, fraternal, corporate, religious, social, service, or 
education), which is not affiliated with the department, that visits a facility 
or SOCS (e.g., tours) or participates in a special event and has constant and 
adequate staff supervision. 
(20) Volunteer - An individual who is not part of a visiting group and who 
provides time and/or services to persons served by the department without 
payment from the department. Volunteers include: 
(A) community citizens; 
(B) family members of persons served when not acting on behalf of the person 
served;
(C) employees when not acting in the capacity of employment;
(D) persons served when not acting solely on behalf of themselves; and 
(E) community restitution volunteers who are required by a court to provide a 
specified number of hours of volunteer services in lieu of a jail sentence. 
(21) Volunteer services council (VSC) - A facility or SOCS's 501(c)(3) 
organization that is formed for generating resources on behalf of the facility 
or SOCS. 
(22) Volunteer Services State Council (VSSC) - A statewide nonprofit 
organization serving all volunteer services councils and volunteer groups of 
state-operated community services (SOCS) and community MHMR centers.

sec.417.304. Volunteer Programs. 
(a) Value of volunteers and donors. Volunteers and donors of the Texas 
Department of Mental Health and Mental Retardation are highly valued as an 
essential component of its functions. Volunteers are recognized and supported in 
their efforts to provide goods, services, and personal attention for persons 
served which enhance and enrich the best treatment and habilitation the state 
can provide. Donors are recognized and supported in their efforts to enhance the 
fundraising capabilities and revenue development of the department, enabling the 
department to provide additional services and goods to the people it serves. 
(b) Requirement to operate volunteer program. Each facility is responsible for 
operating a volunteer program with a full-time director. Facility volunteer 
programs are funded by the department with support from the Office of Community 
Relations, Central Office. 
(c) Insurance. Department funds are used to purchase insurance to protect 
volunteers and visiting groups in the performance of their services.
(d) Professional ethics in volunteer administration. All volunteer services 
activities and practices shall be in accordance with the Association for 
Volunteer Administration's (AVA) Professional Ethics in Volunteer Services 
Administration. A copy of Professional Ethics in Volunteer Services 
Administration can be obtained by contacting the Office of Community Relations, 
TDMHMR Central Office, P.O. Box 12668, Austin, TX 78711-2668.
(e) Volunteer guidelines. 
(1) Volunteers and visiting groups are responsible for complying with all 
applicable rules, regulations, policies, and procedures of the department and 
the facility, specifically including, but not limited to: 
(A) Chapter 403, Subchapter K of this title (relating to Client-Identifying 
Information); 
(B) Chapter 404, Subchapter E of this title (relating to Rights of Persons 
Receiving Mental Health Services);
(C) Chapter 405, Subchapter Y of this title (relating to Client Rights - Mental 
Retardation Services); and 
(D) Chapter 417, Subchapter K of this title (relating to Abuse, Neglect, and 
Exploitation in TDMHMR Facilities). 
(2) A volunteer or visiting group may not give money directly to persons served. 
If a volunteer or visiting group wishes to donate money to a specific person 
served, then the volunteer or visiting group must consult the director of 
community relations for the proper procedure for doing so. 
(3) Under no circumstances may volunteers or visiting groups take or accept 
money from persons served. 
(4) Keys to state buildings, state vehicles, or state equipment are not issued 
to volunteers and visiting groups unless determined necessary by the director of 
community relations, as documented in writing, and approved by the CEO or 
designee. 
(5) Volunteers and visiting groups may use state property only in connection 
with their assigned duties or in connection with activities of the VSC. 
(6) Volunteers and visiting groups are not authorized to use facility 
letterhead. 
(7) Volunteers and visiting groups may not take photographs of persons served 
without obtaining permission from the community relations staff, who will 
determine if photographs are necessary, and if so, will ensure the completion of 
"Consent for Publication" form, referenced as Exhibit A in sec.417.314 of this 
title (relating to Exhibits). 
(8) All portions of volunteer records which directly or indirectly identify a 
person served or a person formerly served are confidential. The confidentiality 
of such portions of the records shall be maintained and may only be disclosed as 
authorized by state statute and Chapter 403, Subchapter K of this title 
(relating to Client-Identifying Information). 
(9) A facility may: 
(A) provide free meals to volunteers if the volunteer is on duty during 
mealtime; and 
(B) reimburse a volunteer for out-of-pocket expenses as determined by the 
facility's policies and procedures. 
(10) Each volunteer shall represent the department's position if identifying 
him/herself as a volunteer of the department, facility, program, or council. 
This does not preclude a volunteer from speaking freely about any matter as a 
private citizen, provided the volunteer clarifies that such comments are the 
individual's opinion and are not made on behalf of the department, facility, 
program, or council. 
(11) Volunteers and visiting groups may ride as passengers in state vehicles in 
connection with their approved volunteer assignment.
(12) Volunteers may drive state vehicles and transport persons served in state 
vehicles as permitted by facility policies and procedures.
(13) Volunteers may drive non-state vehicles to transport persons served as 
permitted by facility policies and procedures provided the volunteer has the 
minimum auto liability insurance coverage for the vehicle as required by state 
law. 
(14) A volunteer whose driver's license is from a state other than Texas may not 
transport persons served until the volunteer has obtained a valid Texas driver's 
license or a military equivalent accepted by the Department of Public Safety in 
lieu of a valid Texas license. 
(f) Current employees as volunteers. Employees may volunteer at a facility if 
they do so willingly and without coercion. 
(1) Except for the situation described in paragraph (2) of this subsection, the 
functional area and geographic location of an employee's volunteer assignments 
must be as far removed as possible from his/her regular work assignments and 
duties. 
(2) If an employee and a person served have a long term friendship as defined in 
sec.417.303 of this title (relating to Definitions), then, as permitted by 
facility policies and procedures, the employee may take the person served to 
his/her home or other location to participate in a special activity (e.g., 
holiday celebration), provided the special activity allows for quality one-to-
one time between the employee and the person served.
(3) Employee volunteers must submit a statement verifying that they are 
volunteering their time without coercion using the "Employee Volunteer 
Statement" form, referenced as Exhibit B in sec.417.314 of this title (relating 
to Exhibits). A copy of the signed form is kept in the community relations 
office and in the employee's personnel file. 
(g) Former employees as volunteers. Former employees eligible for rehire may 
apply to volunteer at the same or at a different facility after a waiting period 
specified by the facility's policies and procedures. 
(h) Persons served as volunteers. 
(1) A person served may perform services as a volunteer if:
(A) the duties the person will be performing: 
(i) do not constitute a job which is or should be the work of a paid employee; 
and 
(ii) are included in the job description of a volunteer assignment;
(B) the person has, willingly and without coercion, expressed a desire to 
volunteer and understands that the activity is a free-will service which means 
"without pay"; 
(C) there are no privileges available to the person that are not also available 
to persons served who do not volunteer; 
(D) appropriate orientation and on-the-job training is provided to enable the 
person to understand and perform the requirements of the volunteer assignment; 
(E) the person understands the boundaries or risks, if any, of the volunteer 
assignment; 
(F) the person's volunteer assignment is compatible with his/her treatment plan; 
and 
(G) the person's volunteer assignment is not on the same unit in which the 
person resides. 
(2) If the person served is also employed by the facility, then the person's 
volunteer assignment must be as far removed as possible from his/her work 
assignments and duties. 
(3) Persons served who volunteer must submit a statement verifying that they are 
volunteering their time without coercion using the "Client Volunteer Statement" 
form, referenced as Exhibit C in sec.417.314 of this title (relating to 
Exhibits). A copy of the signed form is kept in the community relations office 
and in the person's record. 
(4) Activities engaged in by persons served for their own benefit as opposed to 
activities for the common benefit (e.g., gardening/cultivating a plant, as 
opposed to trimming the shrubs) are not considered volunteered services, and are 
not subject to the provisions of this subchapter. 
(5) A person served who was previously a resident of a facility may become a 
volunteer at the facility at the discretion of the director of community 
relations. 
(i) Family members as volunteers. A family member of a person served may 
volunteer provided the family member's volunteer assignment is not on the same 
unit in which the person served resides. 

sec.417.305. Volunteer Program Procedures. 
(a) Request for volunteers. Requests for volunteers may come from facility staff 
and are submitted to the community relations office for processing. 
(b) Volunteer assignment job description. Each volunteer assignment has a job 
description which accurately describes the duties of the assignment. All job 
descriptions are reviewed periodically and revised as needed to accurately 
describe the duties actually being performed by the volunteer. 
(c) Discrimination prohibited. No volunteer, prospective or assigned, shall be 
discriminated against based on race, color, national origin, religion, sex, 
handicap, veteran status, or political affiliation. 
(d) Volunteer application and placement process. Persons interested in 
volunteering at a facility must complete an application for volunteer service 
using the "Volunteer Application," referenced as Exhibit D in sec.417.314 of 
this title (relating to Exhibits), or an appropriate substitute. All volunteer 
applications are maintained in the community relations office. 
(1) All prospective volunteers must be at least 14 years of age. 
(A) Facilities may specify a minimum age above 14 years for specific volunteer 
assignments. 
(B) Prospective volunteers ages 14-17 years must have permission from their 
parent or legal guardian as documented on the "Parental Permission Form - For 
Volunteers Under the Age of 18," referenced as Exhibit E in sec.417.314 of this 
title (relating to Exhibits). 
(C) The number of volunteer hours for minors must not exceed the number of hours 
per week allowed for minors to work under the Fair Labor Standards Act. 
(2) All prospective volunteers are subject to a criminal history record check as 
authorized in the Texas Health and Safety Code, sec.533.007, and Chapter 414, 
Subchapter K of this title (relating to Criminal History Clearances. Completion 
of the criminal history clearance must occur prior to volunteer placement. 
(3) All prospective volunteers must complete a confidentiality agreement using 
the "Confidentiality Agreement for Volunteers" form, referenced as Exhibit F in 
sec.417.314 of this title (relating to Exhibits), or an appropriate substitute.
(4) All prospective volunteers must be approved for volunteer assignment by the 
director of community relations. A prospective volunteer is given a volunteer 
assignment with the agreement of the supervising staff member. 
(5) Before reporting to their volunteer assignment all volunteers are required 
to complete a basic orientation conducted by the community relations staff. 
Volunteers must also receive training in any other areas necessary to 
successfully perform the duties outlined in the job description of their 
volunteer assignment. 
(A) Community relations staff should consult with and utilize the training 
resources of the facility's human resources office. 
(B) Training should be offered at times which are convenient to volunteers, 
including weekends and evenings. 
(e) Assessment of volunteers' performance. Community relations staff and 
facility staff who supervise volunteers should make reasonable efforts to 
periodically review and evaluate volunteers' performance of assigned duties 
using the "Volunteer Assessment Form," referenced as Exhibit G in sec.417.314 of 
this title (relating to Exhibits), or an appropriate substitute. As part of the 
assessment process, volunteers are given an opportunity to evaluate their 
volunteer experience. 
(f) Separation from volunteer assignment. 
(1) The director of community relations may remove a volunteer from his/her 
assignment if it is determined that the volunteer is unsuited for the 
assignment. In determining if a volunteer is unsuited for an assignment, 
consideration is given to previous discussions with the volunteer and the 
volunteer's staff supervisor regarding the assignment, and the amount of 
satisfactory services provided by the volunteer. If the volunteer is removed 
from his/her assignment, the director of community relations may consider the 
volunteer for another assignment. 
(2) A volunteer may decide to leave his/her assignment at any time for any 
reason. A volunteer who decides to leave his/her assignment shall inform the 
community relations staff of such decision. If a person served volunteer decides 
to leave his/her assignment, the community relations staff will notify the 
person's treatment team. 
(g) Exit interviews. Community relations staff should make reasonable efforts to 
conduct an exit interview with volunteers who are leaving their assignment, 
using the "Exit Interview Form," referenced as Exhibit H in sec.417.314 of this 
title (relating to Exhibits). 
(h) Visiting group placement. The director of community relations coordinates 
with a representative of the visiting group for appropriate placement, 
orientation, and training. There is no minimum age for members of a visiting 
group. 

sec.417.306. Awards and Recognition of Volunteers and Visiting Groups. 
(a) Donors, volunteers, and visiting groups providing exemplary service may be 
recognized by a facility or SOCS with: 
(1) the presentation of local "Star" award(s). The number of local "Star" awards 
presented each year is determined by the Office of Community Relations, Central 
Office; and 
(2) a nomination for the "Star of TXMHMR" awards, a statewide volunteer award 
presented annually by the commissioner. The number of "Star of TXMHMR" awards 
presented each year is determined by the commissioner.
(b) In addition to the "Star" and "Star of TXMHMR" awards, other recognition 
items may be presented to donors, volunteers, and visiting groups. 
(c) Recognition items, including the "Star" and "Star of TXMHMR" awards, are 
purchased with department funds. The cost of each recognition item may not 
exceed the $50 limit mandated in the current appropriations act. 

sec.417.307. Volunteer Services Council (VSC). 
(a) Each facility may have a 501(c)(3) organization (i.e., volunteer services 
council (VSC)) to generate resources on its behalf for the needs of persons 
served, the enhancement of existing facility operations, employee 
recognition/education projects, and new initiatives for the betterment of 
quality of life for persons served. Pre-existing VSCs of consolidated facilities 
may remain independent or choose to merge into a single 501(c)(3) organization 
(i.e., VSC). Each VSC must comply with the relevant TDMHMR Board Policies and 
Procedures, department rules, state laws and regulations, and Internal Revenue 
Services requirements. Each VSC is responsible for coordinating its activities 
with facility administration. The facility CEO has full authority over all 
functions and projects concerning the facility, including persons served and 
employees. 
(b) The board of the VSC is cooperatively appointed by the facility CEO and the 
VSC.
(1) The facility CEO and director of community relations have non-voting 
membership on the VSC board and executive committee. 
(2) A facility employee may not be a VSC board member. An employee's spouse and 
minor children are also prohibited from being a VSC board member. 
(c) The VSC bylaws outline specific methodology for: 
(1) limiting terms of officers and board members by number of years; 
(2) replacing board members; 
(3) election of a nominating committee; and 
(4) joining the VSC. 
(d) A memorandum of understanding (MOU) governs the relationship between the 
facility and the VSC. A sample MOU is referenced as Exhibit I in sec.417.314 of 
this title (relating to Exhibits). The MOU shall: 
(1) require the VSC to be in compliance with existing state and federal laws and 
regulations, and applicable department rules and policies;
(2) specify the relationship between facility staff and the VSC, and include a 
mechanism for conflict resolution; 
(3) specify a method for facility staff to assist the VSC in processing and 
receipting donations; 
(4) specify a mechanism to ensure that: 
(A) solicitation is compatible with the mission, vision, and goals of TDMHMR; 
(B) solicitation employs all accepted rules of ethical fundraising;
(C) solicitation is an appropriate type of fundraising for the VSC; and 
(D) all proceeds, less legitimate expenses, are used for the needs of persons 
served, the enhancement of existing facility operations, employee 
recognition/education projects, and new initiatives for the betterment of 
quality of life for persons served 
(5) include limitations and specifics regarding the amount and type of 
expenditures the VSC has authorized the director of community relations to make 
on behalf of the VSC; 
(6) specify that, in the event the VSC is audited by the Internal Revenue 
Service, a copy of the audit report is forwarded to the director of community 
relations for submission to the Office of Community Relations, Central Office; 
and 
(7) assert the right of the department to review and approve all donations of 
real property and any improvements to existing real property which may be made 
to the department by the VSC. 
(e) Funds generated by a VSC may only be used for the needs of persons served, 
the enhancement of existing facility operations, employee recognition/education 
projects, and new initiatives for the betterment of quality of life for persons 
served. Funds may not be used for: 
(1) gifts for legislators or gifts for individual employees, which are not part 
of the facility's established award program; 
(2) recognition events or receptions for individual employees or legislators; 
(3) political contributions or lobbying efforts; 
(4) alcoholic beverages, unless used at a fundraising event; 
(5) loans, including travel advances; 
(6) operating mental health and mental retardation programs, or contracting for 
mental health and mental retardation programs on behalf of a facility; 
(7) cash awards or salary supplementation for employees; and 
(8) other purposes determined by the department to be unethical, unlawful, or 
inappropriate. 
(f) A VSC may not authorize a facility employee to sign a VSC check or use a VSC 
credit card. 
(g) The facility provides the VSC with: 
(1) fundraising assistance; 
(2) clerical and administrative services, (e.g., word processing and accounting 
assistance); 
(3) training for volunteers, board members, and officers;
(4) coordination of activities: and 
(5) office space. 
(h) The VSC is responsible for providing: 
(1) its own postage; 
(2) its own printing (including letterhead and newsletters);
(3) its own special event insurance; 
(4) bond for its officers and signatory agents; and
(5) a mechanism for recognizing its donors, volunteers, and visiting groups. 
(i) A facility's office of community relations may maintain a VSC petty cash 
fund for its VSC if guidelines regarding the fund's purpose and maximum dollar 
amount are included in the memorandum of understanding between the facility and 
the VSC as required by subsection (d) of this section.
(1) The primary custodian of the petty cash fund is responsible for maintaining 
receipts and accurate documentation of all petty cash funds disbursed, and 
furnishing such documentation to the treasurer of the VSC.
(2) Documentation of petty cash disbursements are included in the VSC's annual 
treasurer's report or audit report to the Office of Community Relations, Central 
Office as required by sec.417.313(d)(1) of this title (relating to Auditing and 
Reporting Guidelines).
(3) The primary and alternate custodians of the petty cash fund must complete a 
signed responsibility statement for the funds.
(4) An officer of the VSC or an individual, who is not the director of community 
relations or a community relations staff member, will conduct and document cash 
counts or cash audits of the petty cash fund once every two months. 

sec.417.308. Fundraising and Solicitation.
(a) All fundraising and solicitation activities shall be in accordance with the 
National Society of Fund Raising Executives (NSFRE) Guidelines to the Standards 
of Professional Practice. A copy of Guidelines to the Standards of Professional 
Practice can be obtained by contacting the Office of Community Relations, TDMHMR 
Central Office, P.O. Box 12668, Austin, TX 78711-2668.
(b) Facilities and SOCS are authorized to engage in fundraising activities. A 
facility may work with its VSC to enhance fundraising activities. All 
fundraising activity requires the approval of the director of community 
relations. 
(c) The community relations staff is the only facility or SOCS personnel 
authorized to solicit donations on behalf of the facility or SOCS unless the 
director of community relations or CEO has provided approval for other facility 
or SOCS staff to do so. 
(d) Each facility and SOCS must have written policies and procedures governing 
fundraising activity conducted by its employees and persons served (e.g., bakes 
sales, sales of merchandise) to generate funds for employee and persons served 
activities. 

sec.417.309. Donations.
(a) Acceptance of Donations. 
(1) Donations to the VSC. Donations made to the VSC may be processed by facility 
staff if a method for such assistance is included in the MOU. 
(A) Donated funds. 
(i) Each facility shall develop written policies and procedures which ensures 
the separation of duties for: 
(I) opening VSC mail; 
(II) receiving cash and checks to the VSC; 
(III) receipting funds; 
(IV) recording funds received (fund receiving log); 
(V) depositing funds; and 
(VI) reconciling monthly VSC bank statements with the facility's record of funds 
received. 
(ii) All donated funds remain the property of the VSC until they are accepted by 
the facility. 
(B) Donated in-kind goods and services. 
(i) The donor determines the value of the in-kind goods and services for tax 
purposes. 
(ii) In-kind goods that cannot be used by the VSC may be:
(I) distributed to other nonprofit agencies that have an appropriate use for 
them; 
(II) sold, with the proceeds retained by the VSC, unless sale of the donation is 
prohibited by the donor; or 
(III) discarded, if appropriate. 
(iii) Goods and services are assigned a value in accordance with department 
recommendations for accounting purposes. 
(iv) All donated in-kind goods and services remain the property of the VSC until 
they are accepted by the facility, or board if applicable.
(2) Donations made directly to a facility/SOCS. All donations made directly to a 
facility/SOCS are processed by facility/SOCS staff. For SOCS without a community 
relations office, the CEO appoints an employee who is responsible for the tasks 
required of community relations staff as described in this section. 
(A) Donated funds. 
(i) Funds less than $500 are processed through the facility/SOCS cashier. 
Accounting staff are responsible for recording the funds, with the appropriate 
designation, if applicable, and forwarding a copy of the record to the community 
relations office. Community relations staff are responsible for completing an 
individual pre-numbered cash receipt for each donation.
(ii) Funds $500 or more are processed in accordance with the department's 
operating instructions for Donations Valued at $500 or More (417-17). Following 
acceptance by the Texas MHMR Board, accounting staff are responsible for 
recording the funds, with the appropriate designation, if applicable, and 
forwarding a copy of the record to the community relations office. Community 
relations staff are responsible for completing an individual pre-numbered cash 
receipt for each donation.
(B) Donated goods and services. 
(i) The donor determines the value of the goods and services for tax purposes. 
(ii) The community relations staff assign a value to goods and services using 
values recommended by the department for accounting purposes. Goods and services 
valued at $500 or more are processed in accordance with the department's 
operating instructions for Donations Valued at $500 or More (417-17).
(iii) Donated goods that cannot be used are considered surplus and processed in 
accordance with the department's operating instruction for Materials Management 
(407-2). 
(b) Acknowledgment of donations. 
(1) Donations received by a VSC are acknowledged in accordance with department 
guidelines. 
(2) Donations valued at less than $500 received by a facility/SOCS are 
acknowledged in a letter to the donor from the director of community relations. 
Donations valued at $500 or more that have been accepted by the Texas MHMR Board 
are acknowledged in a letter to the donor from the director of community 
relations. 

sec.417.310. Naming of Non-Capital Improvement Projects. 
(a) The Office of Community Relations, Central Office, must approve the naming 
of any gift, memorial (e.g., park, garden, room), or donated item that is not a 
capital improvement. 
(b) Capital improvement projects are named in accordance with Chapter 410, 
Subchapter C of this title (relating to Capital Improvement by Citizen Groups). 

sec.417.311. Volunteer Services State Council (VSSC).
(a) The membership of the Volunteer Services State Council (VSSC) is open to the 
VSC and volunteer groups of each facility, SOCS, and community MHMR center, and 
the Texas Foundation on Mental Health and Mental Retardation and as determined 
by the VSSC bylaws. 
(b) The VSSC's bylaws set forth the organization's structure and includes a 
methodology for selecting the board of directors, limiting the terms of 
officers, and selecting a nominating committee. The commissioner or designee, 
director of the Office of Community Relations, Central Office, and one member of 
the Texas Mental Health and Mental Retardation Board are nonvoting members of 
the board of directors and executive committee. 
(c) A memorandum of understanding governs the relationship between the VSSC and 
the department. 
(d) The Office of Community Relations, Central Office, provides the VSSC with: 
(1) office space; 
(2) clerical and administrative services (e.g., word processing) 
(3) training for the board of directors and officers; and 
(4) staff assistance for coordination of activities.
(e) The VSSC is responsible for providing: 
(1) it own postage; 
(2) its own printing, including letterhead and meeting materials; and 
(3) bond for its officers. 

sec.417.312. Texas Foundation on Mental Health and Mental Retardation. 
Fundraising on behalf of TDMHMR at the state level is conducted by the Texas 
Foundation on Mental Health and Mental Retardation, which has nonprofit 
(501(c)(3)) status. A memorandum of understanding governs the relationship 
between the department and the foundation. 

sec.417.313. Auditing and Reporting Guidelines.
(a) The Office of Community Relations, Central Office, and each facility 
community relations office are subject to audits conducted by the department and 
the state auditor. 
(b) Each director of community relations must quarterly submit to the Office of 
Community Relations, Central Office, a report stating the value of: 
(1) hours of service donated by its volunteers; 
(2) donations to its VSC processed in accordance with sec.417.309(a)(1) of this 
title (relating to Solicitation and Donations); and 
(3) donations to the facility/SOCS processed in accordance with 
sec.417.309(a)(2) of this title (relating to Solicitation and Donations).
(c) The Texas Foundation on Mental Health and Mental Retardation, the VSSC, and 
each VSC are responsible for obtaining a one-year certified, independent audit 
in accordance with department guidelines at least every three years or as 
required by the Office of Community Relations, Central Office. Entities that 
have annual gross receipts in excess of $100,000 must obtain an annual financial 
review compilation for the years in which an audit is not conducted. Copies of 
all certified, independent audits and management letters are submitted to the 
Office of Community Relations, Central Office.
(d) Annually, each VSC is responsible for submitting to the Office of Community 
Relations, Central Office: 
(1) an annual treasurer's report that complies with GAAS (specifically FAS-116 
and FAS-117) or a copy of the audit and management letter as required in 
subsection (c) of this section; 
(2) a copy of each Form 990S filed with the IRS; 
(3) a copy of current articles of incorporation; 
(4) current bylaws and revisions; 
(5) a list of current officers; 
(6) a copy of current investment policy; and 
(7) evidence of adoption of an annual budget. 

sec.417.314. Exhibits. 
The following exhibits, referenced in this subchapter, are available by 
contacting the Office of Community Relations, TDMHMR Central Office, P.O. Box 
12668, Austin, TX 78711-2668: 
(1) Exhibit A - Consent for Publication. 
(2) Exhibit B - Employee Volunteer Statement; 
(3) Exhibit C - Client Volunteer Statement; 
(4) Exhibit D - Volunteer Application; 
(5) Exhibit E - Parental Permission Form - For Volunteers Under 18 Years of Age; 
(6) Exhibit F - Confidentiality Agreement for Volunteers;
(7) Exhibit G - Volunteer Assessment Form; 
(8) Exhibit H - Exit Interview Form; and 
(9) Exhibit I - Sample Memorandum of Understanding (MOU);

sec.417.315. References. 
Reference is made to the following state and federal statute, and department 
rules and policies: 
(1) Texas Health and Safety Code, sec.533.007; 
(2) Chapter 404, Subchapter H of this title (relating to Criminal History 
Clearances); 
(3) Chapter 410, Subchapter C of this title (relating to Capital Improvements by 
Citizens Groups); 
(4) Chapter 403, Subchapter K of this title (relating to Disclosure of Client-
Identifying Information); 
(5) Chapter 410, Subchapter A of this title (relating to Public Responsibility 
Committees); 
(6) Chapter 404, Subchapter E of this title (relating to Rights of Persons 
Receiving Mental Health Services); 
(7) Chapter 405, Subchapter Y of this title (relating to Client Rights - Mental 
Retardation Services); 
(8) Chapter 417, Subchapter K of this title (relating to Abuse, Neglect, and 
Exploitation in TDMHMR Facilities); 
(9) Fair Labor Standards Act; 
(10) Donations Valued at $500 or More Operating Instruction, 417-17; 
(11) Nutrition and Food Service Operating Instruction, 407-1; and 
(12) Materials Management Operating Instruction, 407-2.

sec.417.316. Distribution.
(a) This subchapter is distributed to: 
(1) members of the Texas MHMR Board; 
(2) executive, management, and program staff at Central Office; 
(3) CEOs of facilities and SOCS; 
(4) members of VSSC board and executive committee, and all VSSC member 
organizations; and 
(5) advocacy organizations. 
(b) CEOs are responsible for the dissemination of the information contained in 
this subchapter to all appropriate staff members. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State on June 1, 1998.
TRD-9808783
Charles Cooper
Chairman
Texas Department of Mental Health and Mental Retardation
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 206-4516

TITLE 31. NATURAL RESOURCES AND CONSERVATION
PART XVIII. Texas Groundwater Protection Committee
CHAPTER 601. Groundwater Contamination Report
SUBCHAPTER A. General Provisions Relating to Public Files and Joint Report
31 TAC sec.sec.601.2-601.5
Texas Groundwater Protection Committee (committee) proposes amendments to 
sec.sec.601.2-601.5, Subchapter A, concerning General Provisions relating to 
Public Files and Joint Report. In addition, this action constitutes the 
committee's proposal to readopt the rules contained in 31 TAC Chapter 601, 
concerning the Groundwater Contamination Report, in accordance with the General 
Appropriations Act, Article IX, sec.167, 75th Legislature, 1997.
EXPLANATION OF PROPOSED RULE
These rules define the conditions that constitute groundwater contamination for 
the purpose of inclusion of cases in the public files for each state agency 
having responsibilities related to the protection of groundwater. The rules also 
describe the contents of the committee's Joint Groundwater Monitoring and 
Contamination Report required under Texas Water Code sec.26.406. The purpose of 
the proposed amendments is to implement legislative changes to Texas Water Code 
sec.26.403(c) regarding committee membership, to update the rules to reflect 
correct agency names, and to establish the policies of the committee regarding 
the report. Format changes were also made to conform with recent rules passed by 
the Secretary of State. 
Proposed amendments to sec.601.2, relating to Applicability, reflect that all 
members of the protection committee have responsibility under these rules. The 
names of the agencies listed under Texas Water Code sec.26.406(b) were added or 
revised to reflect the current membership of the committee. To more accurately 
reflect the committee responsibilities under the joint report, the phrase 
requiring only the agencies that have "responsibilities related to the 
protection groundwater" was moved to the section on public files. 
As required by recent rules passed by the Secretary of State, all of the 
definitions under sec.601.3 have been numbered. Proposed changes to the term 
"commission," reflect an agency name change from the Texas Water Commission to 
the Texas Natural Resource Conservation Commission. A correction to the rule 
citation in the definition of "groundwater contamination" reflects the 
recodification of the referenced rule from Title 31 to Title 30 and a 
clarification that the phrase "10,000 mg/liter" also pertains to dissolved 
solids concentration. Proposed amendments to sec.601.4, relating to Public 
Files, more accurately reflect the statute, which requires the agencies 
identified as having responsibilities related to the protection of groundwater 
to maintain public files of all documented cases of groundwater contamination. 
Proposed amendments to sec.601.5, relating to Joint Groundwater Monitoring and 
Contamination Report, reflect the agency name change of the Texas Water 
Commission to the Texas Natural Resource Conservation Commission and reflect the 
responsibility of all committee member agencies and organizations to provide 
information for the report. 
REVIEW OF COMMITTEE RULES 
The committee also proposes to readopt the rules contained in 31 TAC Chapter 
601, concerning the Groundwater Contamination Report, in accordance with the 
General Appropriations Act, Article IX, sec.167, 75th Legislature, 1997. Rider 
167 requires state agencies to review and consider for readoption rules adopted 
under the Administrative Procedures Act. The reviews must include, at a minimum, 
an assessment that the reason for the rules continues to exist. The committee 
has reviewed the rules in Chapter 601 and determined that the rules are still 
necessary because they provide the definitions and applicability for maintaining 
public files on groundwater contamination cases and contents of the annual Joint 
Groundwater Monitoring and Contamination Report required by Texas Water Code 
sec.26.406. Rules not specifically proposed for amendment are being proposed for 
readoption as they currently exist and will not be published in this proposal. 
FISCAL NOTE 
The committee has determined that during the first five-year period the section 
as proposed is in effect, there will be no fiscal implications as a result of 
the administration of the sections. The effects of this proposed rule change are 
not anticipated to be significant for any individual agency or organization that 
is a member of the committee or impose substantial costs. Similar fiscal 
implications are also anticipated for units of local government that are 
currently providing information for the report. Because the rules govern the 
actions of the committee member agencies and organizations, no fiscal 
implications are anticipated for any other party. 
PUBLIC BENEFIT 
The committee has also determined that for the first five years these sections 
as proposed are in effect, the public benefit anticipated as a result of 
publication of the report will be improved public access to information 
regarding groundwater contamination. The report describes the current status of 
groundwater monitoring activities conducted by or required by each agency at 
regulated facilities or associated with regulated activities; contains a 
description of each case of groundwater contamination documented during the 
previous calender year; contains a description of each case of contamination 
documented during the previous year for which enforcement action was incomplete 
at the time of issuance of the preceding report; and indicates the status of 
enforcement action for each case of contamination which is listed. 
REGULATORY IMPACT ANALYSIS 
The committee has reviewed the proposed rulemaking in light of the regulatory 
impact analysis (RIA) requirements of the Texas Government Code sec.2001.0225 
and has determined that the rulemaking is not subject to sec.2001.0225, which 
applies only to certain major environmental rules that have at lease one of four 
results. The proposed rulemaking provides for a listing of the duties and 
responsibilities assigned to the committee under the Texas Water Code, 
sec.26.406, concerning the maintenance by certain state agencies of public files 
containing documented cases of groundwater contamination and the publication by 
the committee, in conjunction with the Texas Natural Resource Conservation 
Commission (TNRCC), of annual groundwater monitoring and contamination reports 
and to establish general policies of the committee to guide such implementation. 
The proposed rules are not specifically intended to protect the environment or 
to reduce risks to human health and therefore, do not meet the definition of a 
major environmental rule. 
The purpose of this specific rulemaking is to review and consider for readoption 
committee rules under the General Appropriations Act, Article IX, Section 167, 
75th Legislature, 1997. As part of this review, the rule was revised to include 
legislative additions to membership since the rule was originally adopted. 
The rule also does not meet any of the four results that would trigger 
applicability of sec.2001.0225. First, the proposal does not exceed a standard 
set by federal law because there is no equivalent federal statute for the 
reporting of groundwater contamination. Second, this proposal does not exceed an 
express requirement of state law. Sections 26.405(a)(5) and 26.406(c) of the 
Texas Water Code require the committee to publish a joint groundwater monitoring 
and contamination report by April 1 of each year. The report must cover the 
activities and findings of the committee during the previous calendar year. The 
report must describe the current status of groundwater monitoring programs 
conducted or required by each agency at regulated facilities or in connection 
with regulated activities; contain a description of each case documented during 
the previous year and of each case of groundwater contamination documented 
during previous periods for which enforcement action was incomplete at the time 
of issuance of the preceding report; and indicate the status of enforcement 
action for each case. The committee is also tasked under sec.26.406(d) of the 
Texas Water Code to adopt rules defining the conditions that constitute 
groundwater contamination for purposes of inclusion of cases in the public files 
and the joint report. 
Third, this proposal does not exceed a requirement of a delegation agreement or 
contract between the state and an agency or representative of the federal 
government to implement a state and federal program because this report is not 
part of a delegation agreement or contract between the state and a federal 
program. Finally, this proposal does not adopt a rule solely under the general 
powers of the committee instead of under a specific state law. Rules are 
required under sec.26.406(d) of the Texas Water Code. 
TAKINGS IMPACT ASSESSMENT 
The committee has prepared a Takings Impact Assessment for this rule pursuant to 
Texas Government Code Ann. sec.2007.043. The following is a summary of that 
Assessment. The purpose of this rulemaking is to review and consider for 
readoption committee rules under the General Appropriations Act, Article IX, 
Section 167, 75th Legislature, 1997. As part of this review, the rule was 
revised to include legislative additions to membership since the rule was 
originally adopted. 
These rules provide for a listing of the duties and responsibilities assigned to 
the committee under the Texas Water Code sec.26.406, concerning the maintenance 
by certain state agencies of public files containing documented cases of 
groundwater contamination and the publication by the committee, in conjunction 
with the TNRCC, of annual groundwater monitoring and contamination reports and 
to establish general policies of the committee to guide such implementation. 
Because the rule governs the actions of the member agencies and organizations on 
the committee, it does not affect private real property and does not, in whole 
or in part, or temporarily or permanently, restrict or limit a property owner's 
right to the property that would otherwise exist in the absence of the rule. 
COASTAL MANAGEMENT PROGRAM 
The proposed committee rulemaking does not authorize actions contained in the 
Coastal Coordination Act Implementation Rules in 31 TAC sec.505.11(b)(2) or 
sec.505.11(a)(6) or the Natural Resources Code Chapter 33. Section 33.205(a) of 
the Natural Resources Code states that "An agency or subdivision that takes an 
agency or subdivision action described by sec.33.2051 or sec.33.2053 that may 
adversely affect a coastal natural resource area shall comply with the goals and 
policies of the coastal management program." 
Title 31 TAC sec.505.11(b)(2) and sec.505.11(a)(6), which correspond directly 
with Natural Resources Code sec.33.2051 and sec.33.2053, describe agency 
rulemaking actions that require certain agencies to comply with sec.33.205(a) 
and (b) of the Natural Resources Code when adopting or amending a rule governing 
certain activities. However, these provisions do not list the committee as an 
agency subject to the provisions of Natural Resources Code sec.33.205(a) and (b) 
or that must demonstrate compliance with the goals and policies of the Coastal 
Management Plan. The committee is described as "an interagency committee" in 
Texas Water Code sec.26.403, with the power to adopt rules under Texas Water 
Code sec.26.406(d). Texas Water Code sec.26.403(b) designates the TNRCC as the 
lead agency for the committee, and provides that the TNRCC shall administer the 
activities of the committee; however, the committee is given separate statutory 
power to adopt rules under sec.26.406(d). Therefore, cited provisions of the 
Texas Administrative Code and the Natural Resources Code do not apply to the 
committee's adoption of rules. 
Nonetheless, should the rulemaking actions of the committee be interpreted for 
any reason as the TNRCC's adoption of rules, none of the proposed rules falls 
under the actions described in 31 TAC sec.505.11(b)(2) and sec.505.11(a)(6) or 
Natural Resources Code sec.33.2051 or sec.33.2053. Therefore, the requirements 
of the Coastal Management Plan do not apply to this rulemaking. 
SUBMITTAL OF COMMENTS 
Written comments on the proposal should reference TGWPC-Groundwater 
Contamination Report and may be submitted to Lutrecia Oshoko, Texas Natural 
Resource Conservation Commission, Office of Policy and Regulatory Development, 
MC 205, P.O. Box 13087, Austin, Texas 78711-3087, (512) 239-4640; or faxed to 
(512) 239-5687. All comments sent by fax must be followed by an original, signed 
hard copy for the committee's records. Written comments must be received by 5:00 
p.m., July 13, 1998. For further information concerning this proposal, please 
contact Mary Ambrose, Designated Chairman, Texas Groundwater Protection 
Committee, at (512) 239-4813. 
LEGAL AUTHORITY
These amended sections are proposed under Texas Water Code, sec.sec.26.401-
26.407. Texas Water Code sec.26.406(d) provides the committee with the authority 
to promulgate rules defining the conditions that constitute groundwater 
contamination for the purposes of inclusion of cases in the public files and the 
joint report. 
There are no other codes or statutes that will be affected by this proposal.

sec.601.2. Applicability. 
These rules specifically apply to each state agency having <nl>membership on the 
committee.<ol> [responsibilities related to the protection of groundwater, and 
include] <nl>The committee is composed of<ol> the Texas<nl> Natural Resource 
Conservation<ol> [Water] Commission, [the Texas Water Well Drillers Board,] the 
Texas Department of Health, the <nl>Texas<ol> Department of Agriculture, the 
Railroad Commission of Texas, <nl>the Texas Water Development Board, the Texas 
Alliance of Groundwater Districts, the Texas Agricultural Experiment Station, 
the Bureau of Economic Geology of the University of Texas at Austin,<ol> and 
<nl>the<ol> State Soil and Water Conservation Board. 

sec.601.3. Definitions. 
The following words and terms, when used in this chapter, shall have the 
following meanings unless the context clearly indicates otherwise. 
<nl>(1)<ol> Act--House Bill 1458 (71st Session) codified as [the] Texas Water 
Code[,] sec.sec.26.401-26.407.
<nl>(2)<ol> Commission--Texas <nl>Natural Resource Conservation<ol> [Water] 
Commission. 
<nl>(3)<ol> Committee--Texas Groundwater Protection Committee. 
<nl>(4)<ol> Enforcement action--Any action of the agencies, identified in 
sec.601.2 of this title (relating to Applicability), which accomplishes or 
requires the identification, documentation, monitoring, assessing, or 
remediation of groundwater contamination. 
<nl>(5)<ol> Groundwater--Water below the land surface in a zone of saturation. 
<nl>(6)<ol> Groundwater contamination--The detrimental alteration of the 
naturally occurring physical, thermal, chemical, or biological quality of 
groundwater. Furthermore, groundwater contamination, for purposes of inclusion 
of cases in the public files and the joint groundwater monitoring and 
contamination report, shall be limited to contamination reasonably suspected of 
having been caused by activities or by entities under the jurisdiction of the 
agencies identified in sec.601.2 of this title, except in the case of an 
underground source of drinking water granted an aquifer exemption by the 
commission with concurrence from the United States Environmental Protection 
Agency in accordance with 40 Code of Federal Regulations, Parts 144, 145, and 
146, and <nl>30 TAC<ol> Chapter 331 [of this title] (Underground Injection 
Control); and affecting groundwater which contains a concentration of: 
(A) less than or equal to 10,000 milligrams per liter (mg/liter) of dissolved 
solids; or
(B) greater than 10,000 mg/liter <nl>of dissolved solids <ol> if it is: 
(i) currently extracted for beneficial use such as domestic, industrial, or 
agricultural purposes; or 
(ii) hydrologically connected with, and with the potential for contaminant 
movement to, a surface water body or another zone of groundwater which has a 
concentration of less than or equal to 10,000 mg/liter of dissolved solids. 

sec.601.4. Public File. 
(a) Subject to the limitations provided by the Texas Water Code, sec.sec.26.401-
26.407 (the Act), and the Open Records Act, Texas Civil Statutes, Article 6252-
17a, information collected, assembled, or maintained by the committee and the 
agencies <nl>having responsibilities related to protection of groundwater 
under<ol> [subject to] the Act is public record open to inspection and copying 
during regular business hours.
(b) Each agency <nl>having the responsibilities related to the protection of 
groundwater under the Act<ol> shall maintain a public file of all documented 
cases of groundwater contamination that are reasonably suspected of having been 
caused by activities regulated by the agency.

sec.601.5. Joint Groundwater Monitoring and Contamination Report. 
In conjunction with the Texas <nl>Natural Resource Conservation<ol> [Water] 
Commission, the committee shall publish not later than April 1 of each year a 
joint groundwater monitoring and contamination report covering the activities 
and findings of the committee made during the previous calendar year. The report 
must: 
(1) describe the current status of groundwater monitoring programs conducted by 
or required by each <nl>committee<ol> agency <nl> or organization<ol> at 
regulated facilities or in connection with regulated facilities; 
(2)-(3) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State on June 1, 1998.
TRD-9808748
Kevin McCalla
Director, Legal Services
Texas Groundwater Protection Committee
Proposed date of adoption: July 13, 1998
For further information, please call: (512) 239-4640

TITLE 34. PUBLIC FINANCE
PART I. Comptroller of Public Accounts
CHAPTER 3.Tax Administration
SUBCHAPTER V.Franchise Tax
34 TAC sec.3.544
The Comptroller of Public Accounts proposes an amendment to sec.3.544, 
concerning reports and payments. The subsection concerning consolidated 
reporting has been revised in accordance with Senate Bill 861, 75th Legislature, 
1997. Provisions related to the filing of amended reports as a result of an 
audit by the Internal Revenue Service or other competent authority, or as a 
result of the filing of an amended IRS return or other return, including 
penalties, if applicable, have been revised in accordance with Senate Bill 861, 
75th Legislature, 1997. The subsection concerning the signature requirement for 
the public information report has been revised in accordance with Senate Bill 
861, 75th Legislature, 1997. A new subsection has been added to address an 
exception to the statute of limitations for a franchise tax liability that is 
affected by an Internal Revenue Service audit, in accordance with Senate Bill 
862, 75th Legislature, 1997. 
Mike Reissig, chief revenue estimator, has determined that for the first five-
year period the amendment will be in effect there will be no significant revenue 
impact on the state or local government. 
Mr. Reissig also has determined that for each year of the first five years the 
amendment is in effect the public benefit anticipated as a result of adopting 
the amendment will be in providing clarification of comptroller policy. This 
amendment is adopted under the Tax Code, Title 2, and does not require a 
statement of fiscal implications for small businesses. There is no significant 
anticipated economic cost to individuals who are required to comply with the 
proposed amendment. 
Comments on the proposal may be submitted to Karey W. Barton, Manager, Tax 
Policy Division, P.O. Box 13528, Austin, Texas 78711. 
This amendment is proposed under the Tax Code, sec.111.002, which provides the 
comptroller with the authority to prescribe, adopt, and enforce rules relating 
to the administration and enforcement of the provisions of the Tax Code, Title 
2. 
The amendment implements the Tax Code, sec.sec.111.206, 171.203(d), and 171.212.

sec.3.544.Reports and Payments.
(a) (No change.)
(b) Penalty and interest. 
(1)-(5) (No change.)
<nl>(6)<ol> <nl> If a corporation fails to comply with Tax Code sec.171.212, the 
corporation is liable for a penalty of 10% of the tax that should have been 
reported and had not previously been reported to the comptroller under 
sec.171.212. This penalty is in addition to any other penalty provided by law 
and is effective for audits or other adjustments by the Internal Revenue Service 
or a competent authority other than the Internal Revenue Service that became 
final on or after June 20, 1997. <ol>
(c) Consolidated reporting. A consolidated or combined report[, reflecting the 
financial data of a parent corporation and its subsidiaries or the financial 
data of other separate corporations as though they were a single economic 
entity,] is not allowed. 
(d) Amended reports. In filing an amended report, the corporation must type or 
print on the report, immediately above the corporation name, the phrase "Amended 
Report." The report should be forwarded with a cover letter of explanation, with 
enclosures necessary to support the amendment. Applicable penalties and interest 
must be reported and paid <nl>along with<ol>[on] any additional amount of tax 
shown to be due on the amended report. <nl> See subsection (i) of this section 
for information concerning the statute of limitations.<ol> 
(1) (No change.)
(2) A corporation which has been audited by the Internal Revenue Service must 
file an amended franchise tax report within 120 days after the Revenue Agent's 
Report (RAR) is <nl>final<ol> [finalized], if the RAR results in changes to 
<nl>earned surplus<ol> amounts reported for franchise tax purposes. An RAR is 
[considered to be] <nl> final<ol> [finalized] when all administrative appeals 
with the Internal Revenue Service have been exhausted or <nl>waived<ol> 
[forgone]. <nl>An administrative appeal with the Internal Revenue Service does 
not include an action or proceeding in the United States Tax Court or any other 
federal court. <ol>
<nl>(3)<ol> <nl>A corporation whose net taxable earned surplus is changed as a 
result of an audit or other adjustment by a competent authority other than the 
Internal Revenue Service must file an amended franchise tax report within 120 
days after the adjustment is final. An adjustment is final when all 
administrative or other appeals have been exhausted or waived. For the purposes 
of this section, a competent authority includes, but is not limited to, the 
United States Tax Court, United States District Courts, United States Courts of 
Appeals, and United States Supreme Court. <ol>
<nl>(4)<ol> <nl>A corporation must file an amended franchise tax report within 
120 days after the corporation files an amended federal income tax return that 
changes the corporation's net taxable earned surplus. A corporation is 
considered to have filed an amended federal income tax return if the corporation 
is a member of an affiliated group during a period in which an amended 
consolidated federal income tax return is filed.<ol>
<nl>(5)<ol> <nl> Because the 10% penalty provided for in Tax Code, sec.171.212 
only applies to deficiencies, failure to file an amended return in which a 
refund would result will not cause a 10% penalty to be imposed. <ol>
(e) - (g) (No change.) 
(h) Public information report. Each corporation on which the franchise tax is 
imposed must file a public information report as described in Tax Code, 
sec.171.203. 
(1) - (2) (No change.)
<nl>(3)<ol> <nl> Beginning with reports originally due on or after January 1, 
1998, in addition to an officer or director, another authorized person may sign 
the public information report for purposes of satisfying the signature 
requirement. <ol>
<nl>(4)<ol> [(3)] Failure to sign or file a public information report shall 
result in the forfeiture of corporate privileges as provided by Tax Code, 
sec.171.251. If the corporate privileges are forfeited, each officer or director 
of the corporation may be liable for each debt of the corporation that is 
created or incurred in Texas after the date on which the report is due and 
before the corporate privileges are revived, as provided by Tax Code, 
sec.171.255. 
<nl>(5)<ol> [(4)] The provisions of paragraph <nl> (4)<ol> [(3)] of this 
subsection concerning forfeiture of corporate privileges do not apply to a 
banking corporation or a savings and loan association, as defined in Tax Code, 
sec.171.001. 
<nl>(i)<ol> <nl>Statute of limitations. Effective September 1, 1995, a final 
determination resulting from an Internal Revenue Service administrative 
proceeding (including, effective September 1, 1997, an audit), or a judicial 
proceeding arising from an administrative proceeding, that affects the amount of 
franchise tax liability must be reported to the comptroller before the 
expiration of 60 days after the day on which the determination becomes final. 
See the Tax Code, sec.111.206. <ol>
<nl>(j)<ol> [(i)] Effective date. This section applies to reports originally due 
on or after January 1, 1992, unless otherwise specified. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 27, 1998.
TRD-9808607
Martin Cherry
Chief, General Law
Comptroller of Public Accounts
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 463-4062

TITLE 37. PUBLIC SAFETY AND CORRECTIONS
PART I. Texas Department of Public Safety
CHAPTER 27.Crime Records
SUBCHAPTER G.Texas Help End Auto Theft
37 TAC sec.sec.27.81 - 27.89
The Texas Department of Public Safety (DPS) proposes new sec.sec.27.81 - 27.89, 
concerning the Texas Help End Auto Theft (H.E.A.T.) Program. The new sections 
are necessary for the implementation and maintenance of the Texas H.E.A.T. 
Program under the Automobile Theft Prevention Authority (Authority) established 
under the authority of Texas Civil Statutes, Article 4413(37). This act of the 
72nd Texas Legislature intends to reduce auto theft in the State of Texas. 
The new sections set forth procedures for a statewide automobile registration 
program to be administered by the Texas DPS. The goal of the Texas H.E.A.T. 
Program is to help reduce auto theft in the State of Texas. As such, this 
program will primarily be a deterrent to auto theft rather than an apprehension 
tool. The DPS under the direction of the Authority has developed a statewide 
vehicle registration program known as the Texas H.E.A.T. Program. Under the 
Texas H.E.A.T. Program, law enforcement officers are authorized to stop vehicles 
which are registered in the program when observed on public streets anywhere in 
Texas between the hours of 1:00 a.m. and 5:00 a.m., according to the 
registration signed voluntarily by the vehicle owner, to determine whether the 
vehicle is being operated by the owner or with the owner's permission. Vehicle 
owners participating in this program may also voluntarily extend authority to 
peace officers to stop a registered vehicle that crosses or is about to cross an 
international border directly from the state of Texas. 
Tom Haas, Chief of Finance, has determined that for each year of the first five-
year period the rule is in effect there will be no fiscal implications to state 
government as a result of enforcing or administering the rule. 
Mr. Haas also has determined that for each year of the first five years the rule 
is in effect the public benefit anticipated as a result of enforcing the rule 
will be to deter auto theft. Because the Authority actually funds the program, 
the cost to local law enforcement agencies participating in the program is $.01 
for each decal purchased. The cost to persons who are required to comply with 
the rule as proposed is $.01 for the purchase of the decal from the law 
enforcement agency. There is no anticipated economic cost to small or large 
businesses. 
Comments on the proposal may be submitted to Mary Ann Courter, Chief, Legal 
Services, Texas Department of Public Safety, Box 4087, Austin, Texas 78773-0140, 
(512) 424-2890. 
The new sections are proposed pursuant to Texas Civil Statutes, Article 
4413(37), sec.9, and Texas Government Code, sec.411.006(4) which authorizes the 
director to adopt rules, subject to commission approval, considered necessary 
for the control of the department. 
Texas Civil Statutes, Article 4413(37) and Texas Government Code, sec.411.006(4) 
are affected by this proposal. 

sec.27.81.Authority.
(a) The Authority is composed of seven members. The Governor who, with the 
advice and consent of the Senate, appoints the following six members: 
(1) two representatives of motor vehicle insurance consumers;
(2) two representatives of insurance companies writing motor vehicle insurance 
in this state; and 
(3) two representatives of law enforcement. 
(b) The director of the DPS or the director's designee serves ex officio as the 
seventh member of the Authority. 

sec.27.82.Provisions of Texas H.E.A.T. Program. 
(a) A Texas citizen may register his/her vehicle(s) with any local law 
enforcement agency that is participating with the statewide Texas H.E.A.T. 
Program. 
(b) Law enforcement agencies participating in the program shall supervise the 
process in which the decals are distributed to the citizen. Only an authorized 
agency representative shall register citizens in the program and provide 
instructions pertaining to program provisions and positioning of decals on the 
vehicle. The location of the decals shall be below the rearview mirror mount of 
the front windshield and in the lower left hand corner of the rear windshield. 
The left hand side of the rear bumper will be used as an alternative rear 
location, when necessary. 
(c) An individual who wishes to withdraw from the program or who transfers 
possession of the vehicle must remove the decals and notify the local law 
enforcement agency of withdrawal. 
(d) The citizen agrees that any person being permitted to use said vehicle will 
be appropriately advised. 
(e) The citizen agrees and understands that in the process of a vehicle being 
stopped during the program hours of 1:00 a.m. to 5:00 a.m., certain necessary 
precautions will be undertaken by peace officers making the stop. 
(f) It is the intention of the Texas H.E.A.T. Program to operate upon the 
assumption that when a vehicle registered in the program is being operated 
during the designated hours (1:00 a.m. - 5:00 a.m.), a peace officer has the 
authority to stop the vehicle because it is assumed that the vehicle is being 
operated by someone other than a permitted owner. Furthermore, it is also 
assumed that the vehicle has been stolen or misappropriated. 
(g) The citizen shall pay a fee of $.01 to the law enforcement agency. The law 
enforcement agency shall forward that fee to DPS. This fee shall be credited to 
the Automobile Theft Prevention Fund to recover the cost of administration. 
(h) Citizens participating in this program may voluntarily extend the authority 
of peace officers to stop a registered vehicle whenever the vehicle crosses or 
is about to cross an international border directly from the State of Texas. 
(i) Citizens who register their vehicles in this program should be advised that 
information about their vehicle will be entered into the statewide computer file 
(Texas Crime Information Center/TCIC) for purposes of enforcement at a later 
date. 
(j) Individuals should be advised that written notification should be sent to 
the registering law enforcement agency when a decal has been removed from the 
participating vehicle. Failure to do so could result in that vehicle being 
stopped due to the record entry in TCIC. 
(k) This program shall continue from year to year, and each citizen must contact 
the local participating agency to withdraw from the program.

sec.27.83.Law Enforcement Agency Participation.
(a) Participation in the program by law enforcement agencies is voluntary. All 
local law enforcement agencies having entry capability through Texas Law 
Enforcement Telecommunications System (TLETS) into TCIC may choose to 
participate in the statewide Texas H.E.A.T. Program. Agencies that do not 
qualify for entry capability but would like to participate should contact the 
TLETS agency that currently handles their TCIC or National Crime Information 
Center (NCIC) transactions to determine if they can register vehicles in their 
area through the 24-hour TLETS agency. The entering TLETS agency will make those 
TCIC Texas H.E.A.T. vehicle entries with their own Originating Agency Identifier 
(ORI) and maintain the original registration form. This procedure is consistent 
with current TCIC/NCIC policies. The nonentering agency should obtain the decals 
and forms from the entering TLETS agency. Participating local law enforcement 
agencies will be responsible for selling, affixing, or supervising the 
application of the decals to the citizens' vehicles. 
(b) Law enforcement agencies who participate in TLETS are subject to TCIC audit 
and training requirements. TCIC system users will be audited once every two 
years to ensure compliance with state and NCIC policy and regulations. For more 
information, contact the DPS TCIC Audit supervisor at (512) 424-2809. 
(c) TCIC system users must also participate in mandatory training for TCIC. In 
order to ensure compliance, TCIC has established a curriculum and a staff of 
trainers to conduct training throughout the state. There is no charge for 
training provided by DPS and all materials for DPS-administered classes are 
supplied by TCIC. To schedule NCIC/TCIC training in your area, call (512) 424-
2832. Requests for training materials or questions involving this policy or 
other training matters may be addressed to TCIC Training Section, Crime Records 
Service, Texas Department of Public Safety, Box 4143, Austin, Texas 78765-4143. 
(d) In addition, H.E.A.T. training specializing in policies and procedures is 
available. This training also focuses on H.E.A.T. vehicle entries into TCIC. 
H.E.A.T. training is Texas Commission on Law Enforcement Officer Standards and 
Education (TCLEOSE) approved. Requests for H.E.A.T. training may be made by 
calling the Texas H.E.A.T. Program staff at (512) 424-2483. 
(e) In order to participate, the agency need only complete the Texas H.E.A.T. 
Information Sheet, requiring submission of the name of a contact person, that 
person's section, telephone number (including area code), mailing address, and 
physical address. The participating agency must also submit a list of law 
enforcement agencies for which it will make TCIC entries. No separate formal 
document is required to bind a local agency's participation in the statewide 
Texas H.E.A.T. Program. 
(f) It is the intention of the DPS that a participating agency schedule 
dissolution of its local auto theft prevention program, within a reasonable 
period of time in order to participate in the statewide Texas H.E.A.T. Program. 
Currently registered vehicles from local programs may be allowed to continue 
until they expire. Agencies with local programs that have no expiration should 
adopt a plan to discontinue their local program within a reasonable period of 
time of initiating participation in the statewide program. Agencies are urged to 
contact these vehicle owners to have them participate in the Texas H.E.A.T. 
Program as soon as possible after the expiration of the local program. It is the 
intention of the Texas H.E.A.T. Program to ultimately become the only active 
vehicle registration program available in areas choosing to participate in the 
program. This will result in one uniform program allowing officers to 
concentrate on a single type of decal instead of various local decals. An agency 
may continue to register vehicles with its local program only when electing not 
to participate in the Texas H.E.A.T. Program. Additionally, agencies may not 
enter their local-only registered vehicles into TCIC. 
(g) Should an agency decide to withdraw from the statewide program or lose its 
entry capability into TCIC and be forced to withdraw from the statewide program, 
monies collected through the registration process, by statute, must be remitted 
to DPS. An agency needing to withdraw from the statewide program may contact the 
Texas H.E.A.T. Program for assistance. DPS will assist in contacting other 
agencies to expedite transference of Texas H.E.A.T. records and TCIC database 
records. 
(h) The collective registration fees must be forwarded in one check or money 
order to the Texas H.E.A.T. Program, Texas Department of Public Safety, Box 
15999, Austin, Texas 78761-5999 along with a letter on the agency's letterhead 
informing DPS of the agency's withdrawal from the program. Cash is not accepted. 
A copy (pink or yellow) of the completed registration forms, along with all 
unsold Texas H.E.A.T. decals, must be forwarded to the Texas H.E.A.T. Program, 
Texas Department of Public Safety, Box 4143, Austin, Texas 78765-4143. 
(i) The withdrawing agency should solicit a nearby agency to assume its 
registrations. The original registrations should be forwarded to the new local 
agency. However, all unsold Texas H.E.A.T. decals and related supplies issued to 
the withdrawing agency must be returned to the Texas H.E.A.T. Program, Texas 
Department of Public Safety, Box 4143, Austin, Texas 78765-4143. The withdrawing 
agency should notify the registered owners that it has withdrawn from the 
program and which agency now holds his/her registrations. The computer entry 
must be canceled by the withdrawing agency and reentered by the new agency. 
Contact the DPS Texas H.E.A.T. staff for more information. 

sec.27.84.Vehicle Owner Participation.
(a) Vehicle owner participation in the Texas H.E.A.T. Program is voluntary. Each 
owner must determine if he/she wishes to participate. The vehicle owner is 
defined as that person whose name appears on the Texas Certificate of Title or 
that person's spouse. In order to register in the program, the vehicle owner 
will follow the steps outlined in sec.27.86 of this title (relating to 
Registration). 
(b) An individual who later wishes to withdraw from the statewide program or 
transfers possession of the vehicle must fully remove the Texas H.E.A.T. decals 
and notify the registering local law enforcement agency of such removal. Owners 
must submit a signed, written request to the registering agency advising the 
agency of their desire to withdraw from the statewide program. Upon receipt of 
withdrawal notification, the corresponding computer entry must be canceled from 
the system and the corresponding registration form must be so noted. The 
notification document should be filed with the registration form at the local 
agency. 

sec.27.85.Private Enterprise Participation.
(a) Participation in the program is voluntary. A private enterprise is defined 
as any business dealing with motor vehicles, i.e., lube and automotive repair 
businesses and insurance agencies. Participation is limited to the registration 
of vehicles only. The private enterprise should contact the local law 
enforcement agency participating in the Texas H.E.A.T. Program or the Texas 
H.E.A.T. Program staff to receive the necessary registration materials. In order 
to participate, the private enterprise will submit a letter to the Texas 
Department of Public Safety H.E.A.T. Program, The Automobile Theft Prevention 
Authority and to the local law enforcement agency, stating their support of the 
program and their understanding that participation does not constitute an 
endorsement of the business by the department, the Authority, or the local law 
enforcement agency. 
(b) The participating private enterprise must fax the original registration 
forms to the participating local law enforcement agency on the day of 
registration so that Texas H.E.A.T. vehicle entries are made into TCIC within 
the recommended 48 hours. The original registration forms with the attached pink 
copies should then be mailed or hand-delivered to the local law enforcement 
agency at the end of each week. 

sec.27.86.Registration.
(a) The vehicle owner is required to sign a registration form (CR-22) with a 
participating law enforcement agency consenting to the provisions of the 
statewide program. The registration form should be filled out by agency 
personnel or a supervised volunteer after the vehicle owner has read the form 
completely and has consented to all provisions stipulated. 
(b) It is suggested that the main provisions of the program be explained and 
emphasized to ensure registrant understanding. This includes informing the 
registrant that: 
(1) the vehicle is not normally operated between the hours of 1:00 a.m. and 5:00 
a.m.; 
(2) the vehicle may be stopped, according to the registration signed voluntarily 
by the owner, if the vehicle is operated at the above-specified time; 
(3) the installed decal type indicates the registrant's stipulation of border-
crossing privilege or restriction; 
(4) the vehicle and ownership information will be entered into the statewide 
Texas H.E.A.T. Program vehicle file, which is available to all TLETS agencies in 
Texas; 
(5) in order to withdraw from the program, the Texas H.E.A.T. Program decals 
must be fully removed from the vehicle and the owner must notify the registering 
agency, in writing, of such removal and request to withdraw from the program; 
and 
(6) registration is valid until the participant notifies the local participating 
agency of his/her desire to withdraw from the program.
(c) The vehicle owner must present the following criteria to register his/her 
vehicle: 
(1) A type of photo identification (driver license, identification card, etc.); 
(2) proof of insurance and/or vehicle registration receipt; and 
(3) vehicle(s) to be registered. 
(d) The vehicle owner must verify the completed information and sign the 
registration form. 
(e) A stolen vehicle inquiry should be made into TCIC/NCIC by the registering 
law enforcement agency when feasible. 
(f) The vehicle owner will indicate on the registration form whether he/she does 
or does not voluntarily extend to a peace officer the authority to stop the 
registered vehicle whenever that vehicle crosses or is about to cross the 
Texas/Mexico border. Both colors of front decals indicate an officer has the 
authority to stop the vehicle between the program hours of 1:00 a.m. and 5:00 
a.m.; the only difference between the front decals is whether the vehicle owner 
does or does not extend that authority to stop the registered vehicle, due to 
the affixed Texas H.E.A.T. Program decals, at the Texas/Mexico border. A white 
front decal (STATE) will indicate the vehicle owner does extend the authority to 
stop the vehicle under the border condition 24 hours a day; a yellow front decal 
(BORDER) will indicate the owner does not extend the authority to stop the 
vehicle under the border condition. 
(g) The vehicle owner should mark the section "I do" if he/she chooses to extend 
to a peace officer the authority to stop the registered vehicle at the 
Texas/Mexico border 24 hours a day. This indication on the registration form 
requires a white (STATE) decal be placed on the front windshield. The owner 
should be made aware that a peace officer who observes the registered vehicle 
crossing or attempting to cross the border into Mexico at any time of day, may 
stop the registered vehicle to determine if the vehicle is being operated by the 
owner or with the owner's permission. However, an officer cannot refuse to let 
the vehicle cross the border based solely upon the affixed Texas H.E.A.T. 
Program decals. Upon satisfactory determination of ownership or owner's 
verification of the driver, the vehicle may be allowed to cross the border into 
Mexico. 
(h) The vehicle owner should mark the section "I do not" if he/she chooses not 
to extend to a peace officer the authority to stop the registered vehicle at the 
Texas/Mexico border, except between the hours of 1:00 a.m. and 5:00 a.m., based 
solely upon the affixed Texas H.E.A.T. Program decals. This indication on the 
registration form requires a yellow (BORDER) decal be placed on the front 
windshield. The owner should be made aware that a peace officer who observes the 
registered vehicle crossing or attempting to cross the border into Mexico during 
any hours other than 1:00 a.m. to 5:00 a.m., may not stop the registered vehicle 
solely upon the authority of the decal to determine if the vehicle is being 
operated by the owner or with the owner's permission; however, between the hours 
of 1:00 a.m. and 5:00 a.m., an officer may stop the registered vehicle crossing 
or attempting to cross the border into Mexico to determine whether the vehicle 
is being operated by the owner or with the owner's permission. An officer cannot 
refuse to let the registered vehicle cross the border based solely upon the 
affixed Texas H.E.A.T. Program decals. Upon satisfactory determination of 
ownership or owner's verification of the driver, the vehicle may be allowed to 
cross the border into Mexico. 
(i) The authorized agency representative shall instruct the citizen on proper 
decal placement on the vehicle. The rectangular front decals should be placed on 
the inside of the front windshield below the rearview mirror mount and the rear 
round decal should be placed on the outside of the rear windshield in the lower 
left-hand corner. If this location for the rear windshield is impractical, the 
left side of the rear bumper may be used as an alternate location. Discretion 
should be used when affixing the rear decal so that it will not obstruct the 
driver's view. Decals that may be defective should not be utilized for 
registration and may be returned to the Texas H.E.A.T. Program for credit.
(j) The authorized agency representative must sign the registration form. 

sec.27.87.Agency Responsibilities.
(a) Local law enforcement agencies choosing to participate in the Texas H.E.A.T. 
Program are responsible for their own Texas H.E.A.T. vehicle entries into TCIC. 
Delay of an entry should not exceed 48 hours after registration. The record 
entry must be double-checked for accuracy by a second person. This is consistent 
with current TCIC/NCIC policies for all TCIC entries. Only automobile and truck 
vehicle makes listed in Part 8 of the NCIC Code Manual will be allowed entry 
into the TCIC Texas H.E.A.T. vehicle file. No motorcycles, farm and construction 
equipment, etc., will be allowed entry into the TCIC Texas H.E.A.T. vehicle 
file. The registration form must be signed by the terminal operator after 
entering the Texas H.E.A.T. vehicle registration into TCIC. 
(b) The original registration copy (white) must be retained on file at the 
agency for 24-hour access. A copy (pink or yellow) must be given to the vehicle 
owner for his/her files. A file of the third copy (pink or yellow) must also be 
retained by the agency for a calendar month. All completed pink registration 
forms must be mailed by the 10th of the following month to the Texas H.E.A.T. 
Program, Texas Department of Public Safety, Box 4143, Austin, Texas 78765-4143. 
The Texas H.E.A.T. Program section will maintain the master registration file. 
The retention period for canceled registration forms must be determined by the 
entering agency's records manager for compliance with State Library 
requirements. 
(c) Should a law enforcement agency withdraw from participation in the Texas 
H.E.A.T. Program, all unsold decals must be returned to the Texas H.E.A.T. 
Program. A refund for the cost of the decals will be forwarded to the agency 
after the return of the decals. 

sec.27.88.Renewal.
(a) This program shall continue from year to year, and each registrant desiring 
to remain an active participant in the statewide program may continue until the 
registering agency is notified of his/her desire to withdraw from the program. 
(b) Individuals wishing to withdraw from the program or transferring ownership 
of a participating vehicle must notify the registering law enforcement agency in 
writing. 

sec.27.89.Supplies.
(a) The DPS Texas H.E.A.T. Program will maintain supplies of decals and all 
forms. Participating agencies must purchase their first supply of decals at $.01 
per set. The decals are then sold to the public at the same price. The money 
collected from registrations must then be used to purchase additional decals 
from the DPS Texas H.E.A.T. Program as the agency supply is depleted. An agency 
short on supply of decals should not contact another participating agency for 
transfer of decals but should contact the DPS Texas H.E.A.T. Program. 
(b) For more information about the Texas H.E.A.T. Program, write to Texas 
Department of Public Safety, Texas H.E.A.T. Program, Box 4143, Austin, Texas 
78765-4143, (512) 424-2483. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on June 1, 1998.
TRD-9808767
Dudley M. Thomas
Director
Texas Department of Public Safety
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 424-2890

PART IX. Commission on Jail Standards
CHAPTER 259. New Construction Rules
The Commission on Jail Standards proposes amendments to sec.sec.259.146, 
259.341, and 259.750, concerning New Construction Rules to amend to change the 
detail of construction materials for ceilings. 
Jack E. Crump, executive director, has determined that for the first five year 
period the section is in effect there will be no fiscal implications for state 
or local government as a result of enforcing or administering the sections. 
Mr. Crump also has determined that for each year of the first five years the 
section is in effect the public benefits anticipated as a result of enforcing 
the section as proposed will be to provide consistent security standards for 
ceiling construction. 
There will be no effect on small businesses. There is no anticipated economic 
cost to persons who are required to comply with the sections as proposed. 
Comments on the proposal may be submitted to Lynn Weatherby, P.O. Box 12985, 
Austin, Texas, 78711, 512-463-5505. 

37 TAC sec.259.146
The amendment is proposed under Government Code, Chapter 511 which provides the 
Texas Commission on Jail Standards with the authority to adopt reasonable rules 
and procedures establishing minimum standards for the construction, equipment, 
maintenance and operation of county jails.
The statutes that are affected by this rule is Local Government Code, Chapter 
351, 351.002 and 351.015. 

sec.259.146. Ceilings. 
Ceilings within inmate housing areas shall be constructed of a minimum 4" thick 
concrete plank reinforced with #4 bars 8" on center each way or a minimum <nl>10 
gauge<ol> [3/16" thick] steel plate. <nl>Detention type composite ceiling 
systems which provide an equal amount of security may also be utilized upon 
approval by the Commission.<ol> [Innovative design concepts are encouraged and 
comparable materials and methods approved by the Commission may be utilized for 
ceiling construction.]
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State on May 29, 1998.
TRD-9808703
Jack E. Crump
Executive Director
Commission on Jail Standards
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 463-5505

37 TAC sec.259.341
The amendment is proposed under Government Code, Chapter 511 which provides the 
Texas Commission on Jail Standards with the authority to adopt reasonable rules 
and procedures establishing minimum standards for the construction, equipment, 
maintenance and operation of county jails. 
The statutes that are affected by this rule is Local Government Code, Chapter 
351, 351.002 and 351.015. 

sec.259.341. Ceilings. 
Ceilings within inmate housing areas shall be constructed of a minimum 4" thick 
concrete plank reinforced with #4 bars 8" on center each way or a minimum <nl>10 
gauge<ol> [3/16" thick] steel plate. <nl>Detention type composite ceiling 
systems which provide an equal amount of security may also be utilized upon 
approval by the Commission.<ol> [Innovative design concepts are encouraged and 
comparable materials and methods approved by the Commission may be utilized for 
ceiling construction.]
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State on May 29, 1998.
TRD-9808702
Jack E. Crump
Executive Director
Commission on Jail Standards
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 463-5505

37 TAC sec.259.750
The amendment is proposed under Government Code, Chapter 511 which provides the 
Texas Commission on Jail Standards with the authority to adopt reasonable rules 
and procedures establishing minimum standards for the construction, equipment, 
maintenance and operation of county jails. 
The statutes that are affected by this rule is Local Government Code, Chapter 
351, 351.002 and 351.015. 

sec.259.750. Ceilings. 
Ceilings within inmate housing areas shall be constructed of a minimum " thick 
concrete plank reinforced with #4 bars 8" on center each way or a minimum <nl>10 
gauge<ol> [3/16" thick] steel plate. <nl>Detention type composite ceiling 
systems which provide an equal amount of security may also be utilized upon 
approval by the Commission.<ol> [Innovative design concepts are encouraged and 
comparable materials and methods approved by the Commission may be utilized for 
ceiling construction.]
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State on May 29, 1998.
TRD-9808701
Jack E. Crump
Executive Director
Commission on Jail Standards
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 463-5505

CHAPTER 273. Health Services
37 TAC sec.273.4
The Commission on Jail Standards proposes amendment to sec.273.4, concerning 
Health Services to add the requirement that the Texas Uniform Health Status 
Update form be completed and forwarded to the receiving criminal justice agency 
at the time an inmate is transferred. 
Jack E. Crump, executive director, has determined that for the first five year 
period the section is in effect there will be no fiscal implications for state 
or local government as a result of enforcing or administering the section. 
Mr. Crump also has determined that for each year of the first five years the 
section is in effect the public benefits anticipated as a result of enforcing 
the section as proposed will be the ability to maintain comprehensive inmate 
health records. 
There will be no effect on small businesses. There is no anticipated economic 
cost to persons who are required to comply with the section as proposed. 
Comments on the proposal may be submitted to Lynn Weatherby, P. O. Box 12985, 
Austin, Texas, 78711, 512-463-5505. 
The amendment is proposed under Government Code, Chapter 511 which provides the 
Texas Commission on Jail Standards with the authority to adopt reasonable rules 
and procedures establishing minimum standards for the custody, care, and 
treatment of prisoners. 
The statutes that are affected by this rule are Local Government Code, Chapter 
351, 351.002 and 351.015. 

sec.273.4. Health Records. 
(a)-(b) (No change.) 
<nl>(c)<ol> The Texas Uniform Health Status Update form, in the format 
prescribed by the Commission, shall be completed and forwarded to the receiving 
criminal justice facility at the time an inmate is transferred.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State on May 29, 1998.
TRD-9808704
Jack E. Crump
Executive Director
Commission on Jail Standards
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 463-5505

TITLE 40. SOCIAL SERVICES AND ASSISTANCE
PART I. Texas Department of Human Services
CHAPTER 15.Medicaid Eligibility
SUBCHAPTER G.Application for Medicaid
40 TAC sec.15.612
The Texas Department of Human Services (DHS) proposes to amend sec.15.612, 
concerning processing deadlines, in its Medicaid Eligibility chapter. The 
purpose of the amendment is to clarify that DHS has 45 days to make an 
eligibility decision for clients under age 65 who already have a valid 
disability determination for certain federal programs. 
Eric M. Bost, commissioner, has determined that for the first five-year period 
the proposed amendment will be in effect there will be no fiscal implications 
for state or local governments as a result of enforcing or administering the 
amendment. 
Mr. Bost also has determined that for each year of the first five years the 
amendment is in effect the public benefit anticipated as a result of enforcing 
the amendment will be that the clarification ensures that clients who already 
have disability established do not have a delay in eligibility determination. 
The rule clarifies existing policy and has no impact on small or large 
businesses or providers. There will be no effect on small businesses as a result 
of enforcing or administering the amendment. There is no anticipated economic 
cost to persons who are required to comply with the proposed amendment. 
Questions about the content of this proposal may be directed to Judy Coker at 
(512) 438-3227 in DHS's Long-Term Care section. Written comments on the proposal 
may be submitted to Supervisor, Rules and Handbooks Unit-282, Texas Department 
of Human Services E-205, P.O. Box 149030, Austin, Texas 78714-9030,
within 30 days of publication in the Texas Register The amendment is proposed 
under the Human Resources Code, Title 2, Chapters 22 and 32, which authorizes 
the department to administer public and medical assistance programs and under 
Texas Government Code sec.531.021, which provides the Health and Human Services 
Commission with the authority to administer federal medical assistance funds.
The amendment implements sec.sec.22.001-22.030 and 32.001-32.042 of the Human 
Resources Code. 

sec.15.612.Processing Deadlines.
(a) (No change.) 
(b) DHS must make a decision within 45 days on applications from clients age 65 
years or older<nl>. DHS must also make a decision within 45 days on applications 
from clients under age 65 <ol>[or] who have had disability established for the 
Supplemental Security Income program, Social Security Title II benefits, 
Railroad Retirement benefits, or by Medicare for the Qualified Medicare 
Beneficiary and Specified Low-Income Medicare Beneficiary pro- grams. DHS must 
make a decision within 90 days on applications from clients who must have 
disability established by the DHS Disability Determination Unit. The timeliness 
count begins the date the completed and signed application for assistance was 
returned to the local DHS office. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt. 
Filed with the Office of the Secretary of State, on May 28, 1998.
TRD-9808672
Glenn Scott
General Counsel, Legal Services
Texas Department of Human Services
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 438-3765

CHAPTER 48.Community Care for Aged and Disabled
SUBCHAPTER E.Client-Managed Attendant Services
40 TAC sec.48.2615, sec.48.2616
The Texas Department of Human Services (DHS) proposes new sec.sec.48.2615 and 
48.2616, concerning client-managed attendant services pilot voucher project and 
reassessments, in its Community Care for Aged and Disabled chapter. The purpose 
of the new sections is to implement a pilot voucher project statewide as part of 
DHS's client-managed attendant services (CMAS) program and in conjunction with 
the personal attendant services (PAS) program of the Texas Rehabilitation 
Commission. The voucher is a new, third option that a current CMAS or PAS client 
may select in receiving attendant services. Current CMAS rules in this chapter 
apply to the pilot as well as these rules. 
Eric M. Bost, commissioner, has determined that for the first five- year period 
the proposed sections will be in effect there will be no fiscal implications for 
state or local government as a result of enforcing or administering the 
sections. 
Mr. Bost also has determined that for each year of the first five years the 
sections are in effect the public benefit anticipated as a result of enforcing 
the sections will be the addition of a new payment option for consumers of 
client-managed attendant services. There will be no adverse economic effect on 
small or large businesses because current client-managed attendant services 
provider agencies will offer this additional payment option to clients within 
their current budget given by DHS. There is no anticipated economic cost to 
persons who are required to comply with the proposed sections. 
Questions about the content of the proposal may be directed to Frances Barraza 
at (512) 438-3216 in DHS's Community Care Section. Written comments on the 
proposal may be submitted to Supervisor, Rules and Handbooks Unit-180, Texas 
Department of Human Services E-205, P.O. Box 149030, Austin, Texas 78714-9030, 
within 30 days of publication in the Texas Register The new sections are 
proposed under the Human Resources Code, Title 2, Chapter 22, which provides the 
department with the authority to administer public assistance programs. 
The new sections implement sec.sec.22.001-22.030 of the Human Resources Code. 

sec.48.2615.Client-Managed Attendant Services Pilot Voucher Project.
(a) Client participation in voucher project. Current client-managed attendant 
services (CMAS) clients must be given the choice of participating in the voucher 
pilot project. 
(b) Definitions. These definitions apply to this section only.
(1) Provider Agency - A home health agency that has entered into a contractual 
agreement with the Texas Department of Human Services (DHS) or the Texas 
Rehabilitation Commission (TRC) to deliver Client Managed Attendant Services 
(CMAS) or Personal Assistance Services (PAS). The provider agency determines the 
consumer's eligibility for services, authorizes the consumer's service levels, 
and offers the consumer the three payment options in CMAS or PAS. 
(2) Fiscal Agent - A CMAS or PAS provider agency that agrees to participate in 
the voucher payment option. The fiscal agent enters into an contractual 
agreement with the consumer to handle the attendant's payroll, prepare and file 
tax-related forms and reports (i.e., workers' compensation, state and federal 
unemployment, Medicare, and FICA), and distribute money to personal assistance 
provider, consumer, and other sources. 
(3) Client - A recipient of CMAS or PAS who participates in the voucher payment 
option pilot project. The consumer is the employer of and retains control over 
the selection, management, and dismissal of an individual providing personal 
assistance. 
(4) Attendant - A person who is employed by the consumer by entering into a 
written agreement with the consumer to provide personal assistance through CMAS 
or PAS. 
(5) Client Managed Attendant Services (CMAS) or Personal Assistance Services 
(PAS) - Attendant services provided through agencies having a Personal 
Assistance Services license to mentally competent physically disabled clients 
who are willing to supervise their attendant or who have someone who can provide 
the attendant's supervision. This program is unique in that it offers three 
payment options for the delivery of personal assistance services. Payment 
options refer to the way that a personal assistant is paid, and who is the 
employer of record. The payment option is important, as it can play a role in 
the amount of control the consumer has over his services. It also impacts the 
flexibility of the service delivery. 
(6) Voucher Payment Option - In this option, people with disabilities control 
the recruitment, hiring, management, and firing of their personal assistants. A 
fiscal agent (i.e. home health agency) handles employer-related administrative 
functions which includes cutting payroll checks for their personal assistants 
and substitute (back-up) attendants and filing tax-related reports of personal 
assistants. The consumer (person with disability) is the employer of record. 
(c) Client responsibilities. The client is responsible for activities listed in 
sec.48.2604 of this title (relating to Applicant/Client Responsibilities), in 
addition to the responsibilities specified in paragraphs (1)-(16) of this 
subsection: 
(1) selecting the voucher pilot payment option by completing DHS's Client 
Selection of Voucher Pilot Payment Option form; 
(2) appointing the fiscal agent as the client's fiscal and payroll agent; 
(3) requesting criminal history checks of attendant(s), either through the 
provider agency, attendant, or directly from the Department of Public Safety and 
considering this information in determining whether to hire the attendant(s); 
(4) providing substitute (backup) attendant(s); 
(5) resolving any employer/employee-related problems or disagreements directly 
with his attendant(s); 
(6) within the client's authorized state fiscal (from September 1 through August 
31 of the next year) budget, making payroll spending decisions pertaining to 
provisions of attendant services and wages and any attendant employment-related 
costs, including the items specified in subparagraphs (A)-(D) of this paragraph: 
(A) coverage for related attendant employment expenses incurred by the client, 
such as recruitment (advertisement, travel, or telephone calls), requesting a 
criminal history check or an open records check (which is more in-depth than a 
criminal check) of a potential employee, and provision of substitute (backup) 
attendants; 
(B) providing the attendant with one or more of the optional benefits selected 
from the following list: increased wages, workers' compensation, paid vacation, 
health insurance, workers' compensation, work-related travel expenses, and 
bonus, holiday, overtime, and sick pay. If the client elects not to provide 
workers' compensation insurance coverage for the attendant, the client must 
disclose this election to the attendant by having the attendant sign a written 
notice that workers' compensation will not be provided, as specified in sec.6(b) 
of the Consumer Selection of Payment Option and as provided in the "Example" 
Agreement Between Consumer and Personal Assistant;
(C) purchasing more hours of attendant services per month when the client's 
services are at the maximum allowed by the program and receiving reimbursement 
for this cost if the additional cost is within the authorization given by the 
provider agency and for the purpose of the program when received; or 
(D) purchasing other services related to attendant services, provided the 
services are covered by the client's service plan developed by the contract 
agency in conjunction with the client; 
(7) not discriminating against attendants or applicants based on race, creed, 
color, national origin, sex, age, disability, or sexual orientation; 
(8) all other employer tasks not specifically assumed by the fiscal agent; 
(9) notifying the fiscal agent of all attendant enrollments, substitutions, 
dismissals, and the reasons therefor; 
(10) preparing and signing an agreement with the attendant. The agreement must 
specify the tasks the attendant is to perform for the client, the schedule the 
attendant will work for the client, the hourly rate (which must be least at the 
minimum wage level) the client will pay the attendant, timeframes (at least 
twice a month) the fiscal agent will pay the attendant, under what conditions 
the attendant may be released from his duties, need for the attendant to let the 
client know at least 24 hours in advance of the attendant not being able to work 
for the client, and what benefits the attendant will receive; 
(11) supervising the attendant's recording of hours worked and signing and 
dating the attendant's timesheet on or after the last day of the month services 
were provided; 
(12) submitting the signed and dated timesheet to the fiscal agent, according to 
the payroll schedule established by the fiscal agent. The client understands 
that late arrival of time sheets may result in delay in the attendant(s) being 
paid; 
(13) submitting to the provider agency a copayment, if any, required by the 
program, at the end of each month; 
(14) submitting to the fiscal agent receipts or invoices for attendant 
employment related costs. The client cannot receive reimbursement for those 
services lacking copies of receipts. The copy of the receipt or invoice must be 
legible, verify how purchase of an allowable service pertains to the attendant 
employment-related cost, and must not be dated prior to the date the individual 
was certified eligible for CMAS. Additionally the copy of the receipt or invoice 
must include specifications of service purchased, date service was purchased, 
and the vendor's name and identifying information. The receipt must be marked 
paid. If the consumer does not provide required invoices, the fiscal agent will 
not make payments and the consumer must change to the provider model for 
receiving attendant care services; 
(15) informing the fiscal agent and DHS of any changes in the client's status 
which include but are not limited to, changes in the client's address, telephone 
number, and hospitalization; and 
(16) accepting services through a non-voucher payment option for one month if 
the client discontinues services through the voucher payment option. 
(d) Liability. Attendants of clients participating in the voucher pilot project 
are considered employees of the client. The client is the employer of and 
retains control over the selection, management, and dismissal of an individual 
providing long term care, personal assistance, or respite services. Attendants 
are not employees of the fiscal agent or DHS, and the fiscal agent and DHS are 
not responsible or liable for any negligent acts or omissions by the attendant. 
(e) Responsibilities of the fiscal agent. The fiscal agent is responsible for 
activities specified in sec.48.2603 of this title (relating to Contractor 
Responsibilities), in addition to the activities specified in paragraphs (1)-
(12) of this subsection: 
(1) impartially providing the client adequate and appropriate written and oral 
information, including responsibilities under each payment option, to enable the 
client to make a fully informed choice; 
(2) training the client in the program requirements, preparation of employment 
taxes, and any other legal requirements, such as the Occupational Safety and 
Health Act; 
(3) providing the client with information, orientation, and training, as needed, 
concerning fiscal and payroll responsibilities and obligations as employers of 
attendant(s). The fiscal agent will make orientation and training available to 
the client on an ongoing basis to assist the client with fulfillment of the 
duties of an employer; 
(4) acting as the agent for the client for the purpose of: 
(A) registering the client as an employer, including providing assistance to the 
client in completing forms required to obtain an employer identification number 
(EIN) from federal agencies, state agencies, unemployment insurance agencies, 
and workers' compensation insurance agencies if workers' compensation is offered 
to the attendant; 
(B) taking the appropriate action to file for employer agent status with the 
federal and state tax authorities and successfully obtaining agent status; 
(C) making all deposits of unemployment taxes that are withheld according to the 
appropriate schedule; 
(D) if the client provides workers' compensation, assisting the client in 
acquiring workers' compensation insurance for the client's attendant who is the 
client's employee; 
(E) computing and paying federal and state employment taxes, including federal 
withholding FICA (employer and employee shares), local taxes (optional), 
unemployment compensation taxes, workers' compensation insurance (if 
applicable), and other payments required as appropriate, within specified 
timeframes; 
(F) preparing and filing income tax forms and reports within specified 
timeframes; 
(G) maintaining original and file copies of all forms needed to comply with 
federal, state, and local tax payment of unemployment compensation premiums, and 
all other reporting requirements of employers; 
(H) if workers' compensation is provided, processing and paying for the client's 
invoice for the attendant's compensation insurance payments, within specified 
timeframes. If a payment is missed resulting in no coverage, then the fiscal 
agent would be liable for any work-related injuries; 
(I) remitting the required forms to the appropriate state agency and maintaining 
copies of the forms in the client's file, upon receipt of the required completed 
forms from the client. The fiscal agent will return copies of all forms to the 
client for the client's permanent personnel records;
(J) receiving and processing attendant care timesheets, processing the payroll 
for the client's attendant(s) upon receipt of the timesheets, and preparing the 
payroll for the client's attendant(s), performing appropriate income tax, FICA, 
workers' compensation (if applicable), and other withholding according to 
federal and state regulations; 
(K) preparing payroll for the client's attendant(s) according to approved time 
sheets and after making appropriate deductions; 
(L) distributing payroll checks to the client's attendant(s) according to the 
client's and fiscal agent's check distribution policy. Distribution must be at 
least twice a month; 
(M) providing, at the client's request, the client with regular summaries of 
payroll and deductions made on the client's behalf; and 
(N) answering questions and distributing information to concerned parties 
pertaining to the fiscal agent's responsibilities (e.g. information to 
attendants about W-2s, earned income credit if applicable, any information 
concerning withholding that may arise, and information about eligibility or 
ineligibility for benefits); 
(5) conducting checks of criminal conviction of attendants with the Department 
of Public Safety (DPS) and providing the history of convictions to the client 
unless the client prefers to request the check from DPS or require the attendant 
to obtain the information from DPS. The contract agency is also responsible for 
documenting that the client was informed of the criminal history results and 
obtaining a waiver from the client if the client prefers to hire someone with a 
criminal history; 
(6) keeping a record of expenses paid, related to attendant services, for which 
the client is reimbursed, as specified in subsection (c) of this section; 
(7) paying for each of the client's invoices for costs incurred relating to 
attendant services, such as substitute (back-up) attendants and health 
insurance, not to exceed the authorization given by the provider agency as 
specified in subsection (c) of this section. Invoice payment must be made within 
15 working days of the fiscal agent's receipt of the invoice;
(8) reimbursing the client for costs incurred relating to attendant services, 
such as recruitment (including advertisement, travel, or telephone calls), and 
provision of substitute (backup) attendants, not to exceed the authorization 
given by the provider agency, as specified in subsection (c) of this section. 
Payment to the client must be made within 15 working days of the fiscal agent 
receiving the receipt from the client;
(9) serving as the client's fiscal intermediary for unexpended funds within the 
fiscal year;
(10) maintaining record keeping of the reimbursement received, payroll 
disbursed, and client account balances; 
(11) keeping abreast of all state and federal laws and regulations relevant to 
the responsibilities it has undertaken with regard to these filings; and 
(12) retaining an amount of the unit rate as approved by DHS. 

sec.48.2616.Reassessments.
The contractor must reassess the client's condition at least annually. The 
assessment can be done face- to-face or by telephone. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 29, 1998.
TRD-9808727
Glenn Scott
General Counsel, Legal Services
Texas Department of Human Services
Proposed date of adoption: September 1, 1998
For further information, please call: (512) 438-3765

SUBCHAPTER F.In-Home and Family Support Program
40 TAC sec.48.2702, sec.48.2703
The Texas Department of Human Services (DHS) proposes amendments to sec.48.2702 
and sec.48.2703, concerning application and income eligibility, in its Community 
Care for Aged and Disabled chapter. The purpose of the amendment to sec.48.2702 
is to delete the requirement that waiting list applicants be contacted annually 
and to begin the processing time for new applications from the date of the home 
visit rather than the date of assignment from the waiting list. The purpose of 
the amendment to sec.47.2703 is to replace the copayment table with a detailed 
description of the method of copayment assessment. 
Eric M. Bost, commissioner, has determined that for the first five-year period 
the proposed sections will be in effect there will be no fiscal implications for 
state or local government as a result of enforcing or administering the 
sections. 
Mr. Bost also has determined that for each year of the first five years 
sec.47.2702 is in effect the public benefit anticipated as a result of enforcing 
the section will be the presumption of continued interest in the program for all 
waiting list applicants and to "start the clock" for application processing at 
the same time for all applicants, thereby allowing all the same amount of time 
to furnish eligibility information. Mr. Bost also has determined that for each 
year of the first five years sec.47.2703 is in effect the public benefit 
anticipated as a result of enforcing the section will be stability of the rule 
regarding copayment assessment, rather than annual revision. There will be no 
effect on small businesses because the rules only address procedures to be 
followed by caseworkers in processing IH/FSP applications. There is no 
anticipated economic cost to persons who are required to comply with the 
proposed sections. 
Questions about the content of the proposal may be directed to Debbie Berliner 
at (512) 438-3199 in DHS's Long-Term Care section. Written comments on the 
proposal may be submitted to Supervisor, Rules and Handbooks Unit-278, Texas 
Department of Human Services E-205, P.O. Box 149030, Austin, Texas 78714-9030, 
within 30 days of publication in the Texas Register
The amendments are proposed under the Human Resources Code, Title 2, Chapters 22 
and 35, which provides the department with the authority to administer public 
assistance and support services for persons with disabilities programs. 
The amendments implement sec.sec.22.001-22.030 and 35.001-35.012 of the Human 
Resources Code. 

sec.48.2702.Application.
(a) -(e) (No change.) 
[(f) Persons on the waiting list are entitled to be contacted annually to 
determine their continued interest in the program.
<nl>(f)<ol> [(g)] An applicant is entitled to a decision on his application 
within 45 calendar days from the date <nl> of the initial eligibility home 
visit<ol> [the application is assigned for eligibility determination by DHS]. 
<nl>(g)<ol> [(h)] An applicant is entitled to written notification about the 
decision regarding his eligibility for the IH/FSP. Should an applicant be 
ineligible or have his benefits reduced, the notification letter specifies the 
reason for the denial or reduction of benefits.

sec.48.2703.Income Eligibility.
(a) -(c) (No change.) 
(d) <nl>Copayments are determined according to the State Median Income (SMI) for 
the federal fiscal year. A client whose income is at or below the SMI for his 
household size has no copayment. A client whose income is at or greater than 
105% of the SMI will be assessed a copayment. The copayment begins at 10% of the 
cost of the items/services and increases in 10% increments until 100% of the 
cost of items/services is reached, at which point the client is ineligible. The 
copayment is assessed as follows:<ol> [Copayments are figured according to the 
following table:] 
<nl>Figure: 40 TAC 48.2703(d)<ol>
[Figure: 40 TAC 48.2703(d) ]
(e) -(i) (No change.) 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 28, 1998.
TRD-9808673
Glenn Scott
General Counsel, Legal Services
Texas Department of Human Services
Proposed date of adoption: August 15, 1998
For further information, please call: (512) 438-3765

CHAPTER 90.Intermediate Care Facilities for Persons with Mental Retardation or 
Related Conditions
The Texas Department of Human Services (DHS) proposes the repeal of sec.90.237, 
sec.90.262, and sec.90.263, concerning open hearing, appointment of a trustee by 
agreement; involuntary appointment of a trustee; amendments to sec.90.15, 
sec.90.16, sec.sec.90.233-90.236, concerning renewal procedures and 
qualifications, change of ownership, revocation, emergency license suspension 
and closing order, referral to the Attorney General, administrative penalties; 
and new sec.sec.90.237-90.239, concerning appointment of a trustee by agreement; 
involuntary appointment of a trustee; and notification of closure in its 
Intermediate Care Facilities for Persons with Mental Retardation or Related 
Conditions (ICRMR/RC) chapter. The purpose of the repeals, amendments, and new 
sections is to combine Subchapter I, Trustees for Facilities into Subchapter H, 
Enforcement. Technical changes were made to both subchapters; however, 
substantive changes were made to sec.90.236, Administrative Penalties. 
Administrative Penalties are monetary fines assessed on a per diem basis, 
against a facility which violates the Health and Safety Code, Chapter 252. In 
determining whether a violation limits the facility's ability to comply with the 
law, a violation must be a number of simultaneous occurrences and violations 
such that a trend is established, recurrent in nature and type, and of a type 
which presents an immediate and serious threat to at least one resident or of a 
magnitude that constitutes a health and safety hazard, or of a type established 
in the licensing rules concerning ICFMR/RC facilities. The payment rates for 
facility residents range from $79.27 to $329.45 per day based on the size of the 
facility and the need of the client. Client needs range from limited personal 
care and supervision to severe behavior problems and total personal care and 
supervision. To be licensed under Chapter 252, Health and Safety Code, ICFMR/RC 
facilities are required to meet certain standards and follow certain procedures 
which are published in Subsection B, Application Procedures, Subsection C, 
Standards for Licensure, and Subsection D, General Requirements for Facility 
Construction of the Texas Administrative Code. 
Eric M. Bost, commissioner, has determined that for the first five-year period 
the sections and repeals are in effect there will be no fiscal implications for 
state or local government as a result of enforcing or administering the 
sections. 
Mr. Bost also has determined that for each year of the first five years the 
sections are in effect the public benefit anticipated as a result of enforcing 
the sections will be to ensure that the health and safety of ICRMR/RC residents 
are met. There will be no effect on small businesses. The administrative penalty 
rules do not change or amend the licensing standards or procedures and therefore 
have no effect upon the cost of meeting those requirements. The penalties are 
for failure to comply with the standards or procedures and are limited to those 
that have the most impact upon resident care and safety or are necessary to 
ensure timely application for licensure renewal. The facility that is meeting 
the requirements will have no administrative penalty. From 1-1-93 to 10/30/96 
data indicates that 133 out of approximately 710 licensed ICFMR/RC facilities 
were assessed administrative penalties at a cost of $500 per offense, for the 
first offense. The total number of first offenses were 149. Of these 133 
facilities, 109 were assessed a $500 administrative penalty for submitting their 
licensure application late. Twenty-four (24) facilities received an 
administrative penalty in resident care and safety areas. While an individual 
facility may have a penalty imposed, the administrative penalty has no effect on 
the majority of businesses that do not have any administrative penalties. Since 
this is a penalty, DHS believes that the amount should have an effect on a 
facility that is not in compliance with resident care and safety or licensing 
renewal requirements. The administrative penalty rules have no adverse economic 
effect on small business because compliance is required whether or not the 
administrative penalties are utilized. The $500 administrative penalty for late 
licensure applications will be deleted from the schedule and added to sec.90.15 
(b)(3), Renewal Procedures and Qualifications, and sec.90.16 (b)(3) Change of 
Ownership. There is no anticipated economic cost to persons who are required to 
comply with the proposed sections.
Questions about the content of this proposal may be directed to Maxcine 
Tomlinson at (512) 438-3169 in DHS's Long Term Care Policy Section. Written 
comments on the proposal may be submitted to Supervisor, Rules and Handbooks 
Unit-243, Texas Department of Human Services E-205, P.O. Box 149030, Austin, 
Texas 78714-9030, within 30 days of publication in the Texas Register. 

SUBCHAPTER B.Application Procedures
40 TAC sec.90.15, sec.90.16
The amendments are proposed under the Health and Safety Code, Chapter 252, which 
provides the department with the authority to license intermediate care 
facilities serving persons with mental retardation or a related condition; and 
under the Human Resources Code, Title 2, Chapter 22, which provides the 
department with the authority to administer its programs. 
The amendments implement the Health and Safety Code, sec.sec.252.001 - 252.186, 
and the Human Resources Code, sec.sec.22.001 - 22.030. 

sec.90.15.Renewal Procedures and Qualifications.
(a) (No change.) 
(b) Each license holder must, at least 45 days prior to the expiration of the 
current license, file an application for renewal with the Texas Department of 
Human Services (DHS). DHS considers that an individual has filed a timely and 
sufficient application for the renewal of a license if the license holder: 
(1) - (2) (No change.) 
(3) submits a complete application to DHS, DHS receives the application during 
the 45-day period ending on the date the current license expires, and the 
individual pays a <nl>$500 <ol>fine under the administrative penalties described 
in sec.90.236(h)(H) of this title (relating to Administrative Penalties). 
(c) -(e) (No change.) 

sec.90.16.Change of Ownership.
(a) (No change.) 
(b) To avoid a gap in the license because of a change in ownership of the 
facility, the prospective purchaser must submit to DHS a complete application 
for a license under sec.90.11 of this title (relating to Criteria for Licensing) 
at least 30 days before the anticipated date of sale or other transfer for 
owner- ship. The applicant must meet all requirements for a license. If the 
applicant has filed a timely and sufficient application for a license and 
otherwise meets all requirements for a license, DHS will issue the applicant a 
license effective on the date of transfer of ownership. DHS considers an 
individual has filed a timely and sufficient application for a license if the 
individual submits: 
(1) -(2) (No change.) 
(3) a complete application to DHS, DHS receives the application during the 30-
day period ending on the anticipated date of sale or other transfer of 
ownership, and the individual pays a <nl>$500 <ol>fine under the administrative 
penalties described in sec.90.236(h)(H) of this title (relating to 
Administrative Penalties); or 
(4) - (5) (No change.) 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 28, 1998.
TRD-9808674
Glenn Scott
General Counsel, Legal Services
Texas Department of Human Services
Proposed date of adoption: September 1, 1998
For further information, please call: (512) 438-3765

SUBCHAPTER H.Enforcement
40 TAC sec.sec.90.233-90.239
The amendments and new sections are proposed under the Health and Safety Code, 
Chapter 252, which provides the department with the authority to license 
intermediate care facilities serving persons with mental retardation or a 
related condition; and under the Human Resources Code, Title 2, Chapter 22, 
which provides the department with the authority to administer its programs.
The amendments and new sections implement the Health and Safety Code, 
sec.sec.252.001 - 252.186, and the Human Resources Code, sec.sec.22.001 - 
22.030.

sec.90.233.Revocation.
(a) (No change.) 
(b) In addition, DHS may revoke a license if the license holder:
(1) (No change.) 
(2) used subterfuge or other evasive means to obtain the license; [or] 
(3) concealed a material fact in the application for a license or failed to 
disclose information required in sec.90.13 of this title (relating to Applicant 
Disclosure Requirements) that would have been the basis to deny the license 
under sec.90.17 of this title (relating to Criteria for Denying a License or 
Renewal)<nl>; or <ol>[.]
<nl>(4)<ol> <nl>received monetary or other remuneration from a person or agency 
that furnishes services or materials to the facility or individuals for a fee. 
<ol>
(c)-(e) (No change.)

sec.90.234.Emergency License Suspension and Closing Order.
(a) The Texas Department of Human Services (DHS) <nl>may <ol>[will] suspend a 
facility's license or order an immediate closing of part of the facility if:
(1) - (2) (No change.) 
(b) -(c) (No change.) 
(d) When an emergency suspension has been ordered and the conditions in the 
facility indicate that residents should be relocated, the following rules apply: 
(1) (No change.) 
(2) If a facility or part thereof is closed: 
(A) DHS will notify <nl>the Texas Department of Mental Health and Mental 
Retardation (TDMHMR), <ol>the local health department director, city or county 
health authority, and representatives of the appropriate state agencies of the 
closure; 
(B) -(C) (No change.) 
(D) DHS must <nl>contact TDMHMR to <ol>arrange for relocation to other 
facilities in the area in accordance with the resident's preference. A facility 
chosen for relocation must be in good standing with DHS and, if certified under 
Titles XVIII and XIX of the Social Security Act, must be in good standing under 
its contract. The facility chosen must be able to meet the needs of the 
resident; 
(E) - (H) (No change.) 
(e) (No change.) 

sec.90.235.Referral to the Attorney General.
<nl>(a)<ol> The Texas Department of Human Services (DHS) may petition a district 
court for a temporary restraining order to restrain a person from continuing a 
violation of the standards prescribed by this chapter if DHS finds that the 
violation creates an immediate threat to the health and safety of the facility's 
residents. 
<nl>(b)<ol> <nl> A district court, on petition by DHS, may by injunction: <ol>
<nl>(1)<ol> <nl> prohibit a person from continuing a violation of the standards 
or licensing requirements prescribed by this chapter; <ol>
<nl>(2)<ol> <nl> restrain or prevent the establishment, conduct, management, or 
operation of a facility without a license issued under this chapter; or <ol>
<nl>(3)<ol> <nl> grant the injunctive relief warranted by the facts on a finding 
by the court that a person is violating the standards or licensing requirements 
prescribed by this chapter.<ol> 
<nl>(c)<ol> <nl> DHS <ol>[The Texas Department of Human Services (DHS)] may 
refer a facility to the attorney general for the assessment of civil penalties 
under the Texas Health and Safety Code, <nl> sec.252.064 <ol>[sec.242.065], for 
a violation that threatens the health and safety of a resident.

sec.90.236.Administrative Penalties.
(a) The Texas Department of Human Services (DHS) may <nl> assess<ol> [recommend 
assessment of] administrative penal- ties against a <nl>facility that 
<ol>[person who] violates the Health and Safety Code, Chapter <nl>252 <ol>[242], 
<nl>or any rule adopted under this chapter, <ol>as provided in this section. 
<nl>(b)<ol> <nl> For purposes of this chapter a "violation" is defined as any 
noncompliance with the Health and Safety Code, Chapter 252, or any rule under 
this chapter, as provided in this section.<ol> 
<nl>(c)<ol> <nl>For purposes of this chapter "immediate and serious threat" 
means a situation in which there is a high probability that serious harm or 
injury to residents could occur at any time or has already occurred and may 
occur again if individuals are not protected effectively from the harm or if the 
threat is not removed. <ol>
<nl>(d)<ol> [(b)] When a violation cited by DHS is determined to be within the 
scope<nl>, severity, <ol>and description of the penalty schedules as stated in 
subsection <nl>(m) <ol>[(h)] of this section, the violation <nl>may be <ol>[is] 
cause for assessment of a penalty as described in this section and as listed in 
subsection <nl>(m) <ol>[(h)] of this section. In determining whether a violation 
limits the facility's ability to comply with the law, a violation must be: 
(1) of a number of existing simultaneous occurrences <nl> and previous 
violations <ol>such that a pattern or trend is established; or 
(2) recurrent in nature and type; or 
(3) one which presents <nl>an immediate and serious threat to <ol>[danger to the 
health and safety of] at least one resident <nl>, as defined in subsection (c) 
of this section<ol>; or
(4) of a magnitude or nature that constitutes a health and safety hazard having 
a direct or imminent adverse effect on resident health, safety, [or] security, 
<nl>training, <ol>or which presents even more serious danger or harm; or 
(5) of a type established elsewhere in DHS's <nl>licensing <ol>rules concerning 
[licensing standards for long term care] <nl> Intermediate Care Facilities for 
Persons with Mental Retardation or Related Conditions (ICRMR/RC) <ol>facilities. 
<nl>(e)<ol> [(c)] No facility will be penalized because of a physician's or 
consultant's nonperformance beyond the facility's control or if documentation 
clearly indicates the violation is beyond the facility's control. 
<nl>(f)<ol> [(d)] An offense is defined as <nl> a sum of the licensure 
violations found during an inspection <ol>[all deficiencies cited during a 
particular survey]. The first offense <nl> violations carry <ol>[carries] the 
penalty shown in the "first offense" column under subsection <nl>(m) <ol>[(h)] 
of this section. The second offense <nl>violations carry<ol> [carries] the 
penalty shown in the "second offense" column. The third offense <nl>violations 
carry <ol> [carries] the penalty shown in the "third offense" column. [For 
purposes of determining a "first offense," this provision does not apply to 
Offense I.] 
<nl>(g)<ol> [(e)] The progression of offenses described in subsection 
<nl>(f)<ol> [(d)] of this section applies to facilities regardless of license 
renewals; however, when a facility has not had an offense for a period of two 
years, the facility's next offense will be in the "first offense" column under 
subsection <nl>(m) <ol>[(h)] of this section. A suspension of a license and 
subsequent reinstatement does not interrupt the progression. 
<nl>(h)<ol> <nl>The administrative penalty begins on the date DHS first 
established the deficiency existed. <ol>
<nl>(i)<ol> <nl>A per diem penalty ceases on the date a violation has been 
corrected, and the facility; <ol>
<nl>(1)<ol> <nl>notifies DHS in writing that the violation has been corrected; 
and<ol> 
<nl>(2)<ol> <nl> provides the date of the correction; and <ol>
<nl>(3)<ol> <nl> evidences later that the violation was corrected. <ol>
<nl>(j)<ol> <nl> Within 10 days following written notification from the regional 
office to the licensing section that a penalty has been assessed, DHS's 
licensing section will send a written notice and a preliminary report to the 
facility which includes, the procedures for notification of recommended 
assessment, opportunity for hearing, actual assessment, payment of penalty, 
judicial review, and remittance. <ol>
<nl>(k)<ol> <nl>The facility has a right to request an appeal as out- lined in 
sec.96.6 of this title (relating to Informal Administrative Review Process for 
Intermediate Care Facilities for Persons with Mental Retardation and Related 
Conditions) and sec.96.7 of this title (relating to Appeals).<ol>
<nl>(l)<ol> [(f)] Within 20 days after the date on which written notice of 
recommended assessment of a penalty is sent to a facility, the facility must 
give DHS written consent to the penalty or make a written request for a hearing. 
If the facility does not make a response within the 20-day period, DHS will 
<nl>assess<ol> [request that] the penalty [be assessed]. <nl>Hearings will be 
held in accordance with the formal hearing procedures in Chapter 79 of this 
title (relating to Legal Services).<ol> 
[(g) The procedures for notification of recommended assessment, opportunity for 
hearing, actual assessment, payment of penalty, judicial review, and remittance 
will be in accordance with the Health and Safety Code, sec.sec.242.067 - 
242.069. Hearings will be held in accordance with the formal hearing procedures 
in Chapter 79 of this title (relating to Legal Services).] 
<nl>(m)<ol> [(h)] <nl>Scope, severity, <ol>[Conditions] and assessments for 
violations warranting administrative penalties for licensed facilities are as 
follows: 
Figure: 40 TAC sec.90.236<nl>(m)<ol>[(h)] 

sec.90.237.Appointment of a Trustee by Agreement.
(a) A person holding a controlling interest in a facility may, at any time, 
request the Texas Department of Human Services (DHS) to assume the operation of 
the facility through the appointment of a trustee. 
(b) If DHS believes that the appointment of a trustee is desirable, DHS may 
enter into an agreement with the person holding the controlling interest for the 
appointment of the trustee to take charge of the facility. 
(c) Any agreement entered into under this section must: 
(1) specify all terms and conditions of the trustee's appointment and authority; 
and 
(2) preserve all rights of the residents as granted by law. 
(d) The agreement will terminate either at a time specified in the agreement or 
upon receipt of notice of intent to terminate sent by either party. 
(e) If DHS determines that termination of the agreement by the person holding a 
controlling interest in the facility would not be in the best interest of the 
residents, DHS will petition a court for an involuntary appointment under the 
terms of sec.90.263 of this title (relating to Involuntary Appointment of a 
Trustee). 
(f) The appointment of a trustee by agreement does not suspend the obligation of 
a facility to pay assessed civil money or administrative penalties. 

sec.90.238.Involuntary Appointment of a Trustee.
(a) The Texas Department of Human Services (DHS) may petition a court of 
competent jurisdiction for the involuntary appointment of a trustee to operate a 
facility if one or more of the following conditions exist: 
(1) the facility is operating without a license; 
(2) the facility's license has been suspended or revoked;
(3) license suspension or revocation procedures against a facility are pending 
and an imminent threat to the health and safety of the residents exists; 
(4) an emergency exists that presents an immediate threat to the health and 
safety of the residents; and/or 
(5) the facility is closing (whether voluntarily or through an emergency closure 
order) and arrangements for relocation of the residents to other licensed 
institutions have not been made before closure. 
(b) A trustee appointed under this section is entitled to a reasonable fee as 
determined by the court to be paid from the Nursing and Convalescent Home trust 
fund. 
(c) The trustee may use the emergency assistance funds in the trust fund only to 
alleviate an immediate threat to the health and safety of the residents, through 
such disbursements as payments for food; medication; sanitation services; minor 
repairs; supplies necessary for personal hygiene; or services necessary for the 
personal care, health and safety of the residents.
(d) Before emergency assistance funds may be dispersed, a court order must be 
entered authorizing DHS to disburse emergency assistance funds to the facility. 
(e) A facility that receives emergency assistance funds under this section must 
reimburse DHS for the amounts received not later that one year after the date on 
which the funds were received by the trustee. The owner of the facility at the 
time the trustee was appointed is responsible for the reimbursement and must pay 
interest from the date the funds were disbursed on the amount outstanding at a 
rate equal to the rate of interest determined under Texas Civil Statutes, 
Article 5069-1.05, to be applicable to judgments rendered during the month in 
which the money was disbursed to the facility. DHS will deposit the 
reimbursement and the interest received under this subsection to the credit of 
the Nursing and Convalescent Home Trust Fund. 
(f) Any amount remaining due at the end of one year becomes delinquent and will 
be referred to the attorney general. 
(g) The Texas Department of Mental Health and Mental Retardation may determine 
that the facility is ineligible for a Medicaid provider contract.

sec.90.239.Notification of Closure.
(a) A facility that is closing temporarily or permanently, voluntarily or 
involuntarily, shall notify the individuals of the closing and make reasonable 
efforts to notify in writing each individual's nearest relative or the person 
responsible for the individual's support within a reasonable time before the 
facility closes. 
(b) If the Texas Department of Human Services orders a facility to close or the 
facility's closure is in any other way involuntary, the facility shall make the 
notification, orally or in writing, immediately on receiving notice of the 
closing. 
(c) If the facility's closure is voluntary, the facility shall make the 
notification not later than one week after the date on which the decision to 
close is made. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 28, 1998.
TRD-9808676
Glenn Scott
General Counsel, Legal Services
Texas Department of Human Services
Proposed date of adoption: September 1, 1998
For further information, please call: (512) 438-3765

40 TAC sec.90.237
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Department 
of Human Services or in the Texas Register office, Room 245, James Earl Rudder 
Building, 1019 Brazos Street, Austin.)
The repeal is proposed under the Health and Safety Code, Chapter 252, which 
provides the department with the authority to license intermediate care 
facilities serving persons with mental retardation or a related condition; and 
under the Human Resources Code, Title 2, Chapter 22, which provides the 
department with the authority to administer its programs. The repeal implements 
the Health and Safety Code, sec.sec.252.001 - 252.186, and the Human Resources 
Code, sec.sec.22.001 - 22.030. 
sec.90.237.Open Hearing.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 28, 1998.
TRD-9808675
Glenn Scott
General Counsel, Legal Services
Texas Department of Human Services
Proposed date of adoption: September 1, 1998
For further information, please call: (512) 438-3765

SUBCHAPTER I.Trustees for Facilities
40 TAC sec.90.262, sec.90.263
(Editor's note: The text of the following sections proposed for repeal will not 
be published. The sections may be examined in the offices of the Texas 
Department of Human Services or in the Texas Register office, Room 245, James 
Earl Rudder Building, 1019 Brazos Street, Austin.)
The repeals are proposed under the Health and Safety Code, Chapter 252, which 
provides the department with the authority to license intermediate care 
facilities serving persons with mental retardation or a related condition; and 
under the Human Resources Code, Title 2, Chapter 22, which provides the 
department with the authority to administer its programs. The repeals implement 
the Health and Safety Code, sec.sec.252.001 - 252.186, and the Human Resources 
Code, sec.sec.22.001 - 22.030. 
sec.90.262.Appointment of a Trustee by Agreement.
sec.90.263.Involuntary Appointment of a Trustee.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 28, 1998.
TRD-9808677
Glenn Scott
General Counsel, Legal Services
Texas Department of Human Services
Proposed date of adoption: September 1, 1998
For further information, please call: (512) 438-3765

CHAPTER 92.Personal Care Facilities
SUBCHAPTER B.Application Procedures
40 TAC sec.92.51, sec.92.53
The Texas Department of Human Services (DHS) proposes new sec.92.51, concerning 
licensure of facilities for persons with Alzheimer's disease, and sec.92.53, 
concerning standards for certified Alzheimer's personal care facilities, in its 
Personal Care Facilities chapter. The purpose of the new sections is to 
implement House Bill 2510, passed by the 75th Legislature. The rules establish 
an Alzheimer certification process which is mandatory for any personal care 
facility which advertises, markets, or otherwise promotes that it provides 
specialized care for persons with Alzheimer's disease or related disorders. 
Eric M. Bost, commissioner, has determined that for the first five- year period 
the sections are in effect there will be no fiscal implications for state or 
local government as a result of enforcing or administering the sections. Mr. 
Bost also has determined that for each year of the first five years the sections 
are in effect the public benefit anticipated as a result of enforcing the 
sections will be to protect the public and residents of Alzheimer's personal 
care facilities through the establishment of an Alzheimer's certification 
process, which will ensure that personal care facilities which advertise 
Alzheimer care are, in fact, delivering care above and beyond that provided by a 
regular personal care facility. Selecting a facility will be easier for 
consumers because of the requirement for a disclosure statement which provides 
information on all aspects of the operation of the facility. The quality of care 
provided to residents of Alzheimer's personal care facilities will be enhanced 
through requirements for staff training regarding Alzheimer's disease and 
related disorders, an extensive activities program, an activities director, an 
outdoor recreation area, and special security measures. 
Any personal care facility which advertises, markets, or otherwise promotes that 
it provides specialized care for persons with Alzheimer's disease or related 
disorders will have to comply with the more stringent rules for Alzheimer 
facilities. Requirements for staff training, an activities program, an 
activities director, an outdoor recreation area and special security measures 
will all add to the costs for a certified Alzheimer facility. Small facilities 
will have a comparatively greater cost because of the economy of scale inherent 
in a larger facility. There is no anticipated economic cost to persons whoare 
required to comply with the proposed sections. 
Questions about the content of this proposal may be directed to Susan Syler at 
(512) 438-3111 in DHS's Long Term Care Policy Section. Written comments on the 
proposal may be submitted to Supervisor, Rules and Handbooks Unit-240, Texas 
Department of Human Services E-205, P.O. Box 149030, Austin, Texas 78714-9030, 
within 30 days of publication in the Texas Register The new sections are adopted 
under the Health and Safety Code, Chapter 247, which authorizes the department 
to license personal care facilities, and Human Resources Code, Title 2, Chapter 
22, which authorizes the department to administer public assistance programs. 
The new sections implement the Health and Safety Code, sec.sec.247.001-247.066, 
and the Human Resources Code, sec.sec.22.001- 22.030. 

sec.92.51.Licensure of Facilities for Persons with Alzheimer's Disease.
(a) Any facility which advertises, markets, or otherwise promotes that the 
facility or a distinct part of the facility provides specialized care for 
persons with Alzheimer's disease or related disorders must be certified under 
this subchapter. Use of advertising terms such as "medication reminders or 
assistance," "meal and activity reminders," "escort service," or "short-term 
memory loss, confusion, or forgetfulness" will not trigger a requirement for 
certification as an Alzheimer's facility. 
(b) The facility must be licensed as a Type B facility. 
(c) Application for certification must be made on forms prescribed by the Texas 
Department of Human Services (DHS) and must include: 
(1) an annual fee of $100; 
(2) a disclosure statement, using DHS's form, describing the nature of its care 
or treatment of residents with Alzheimer's disease and related disorders. The 
disclosure statement must be updated and submitted to DHS as needed to reflect 
changes in special services for residents with Alzheimer's disease or related 
disorders. 
(d) The facility must not exceed the maximum number of residents specified on 
the certificate. 
(e) A certificate must be posted in a prominent location for public view. 
(f) A certificate is valid for one year from the effective date of approval by 
DHS. 
(g) A certificate will be canceled upon change of ownership and if DHS finds 
that the certified unit or facility is not in compliance with applicable laws 
and rules. A facility must remove a cancelled certificate from display and 
advertising, and the certificate must be surrendered to DHS upon request.

sec.92.53.Standards for Certified Alzheimer's Personal Care Facilities.
(a) Manager qualifications and training. 
(1) The manager of the certified Alzheimer facility or the supervisor of the 
certified Alzheimer unit must be 21 years of age, and have:
(A) a college degree in psychology, social work, counseling, gerontology, 
nursing or a related field, with documented course work in dementia care; or 
(B) one year of work experience with persons with dementia.
(2) The manager or supervisor must complete six hours of annual continuing 
education regarding dementia care. 
(b) Staff training. 
(1) All staff members must receive four hours of dementia-specific orientation 
prior to assuming any job responsibilities. Training must cover, at a minimum, 
the following topics: 
(A) basic information about the causes, progression, and management of 
Alzheimer's disease; 
(B) managing dysfunctional behavior; and 
(C) identifying and alleviating safety risks to residents with Alzheimer's 
disease. 
(2) Direct care staff must receive 16 hours of on-the-job supervision and 
training within the first 16 hours of employment following orientation. Training 
must cover: 
(A) providing assistance with the activities of daily living;
(B) emergency and evacuation procedures specific to the dementia population; and 
(C) managing dysfunctional behavior. 
(3) Direct care staff must annually complete 12 hours of inservice education 
regarding Alzheimer's disease. Suggested topics include: 
(A) assessing resident capabilities and developing and implementing service 
plans; 
(B) promoting resident dignity, independence, individuality, privacy and choice; 
(C) planning and facilitating activities appropriate for the dementia resident; 
(D) communicating with families and other persons interested in the resident; 
(E) resident rights and principles of self-determination;
(F) care of elderly persons with physical, cognitive, behavioral and social 
disabilities; 
(G) medical and social needs of the resident; 
(H) common psychotropics and side effects; and 
(I) local community resources. 
(c) Staffing. A facility must employ sufficient staff to provide services for 
and meet the needs of its Alzheimer's residents. In large facilities or units 
with 17 or more residents, two staff members must be immediately available when 
residents are present. 
(d) Pre-admission. The facility must establish procedures, such as an 
application process, interviews, and home visits, to ensure that prospective 
residents are appropriate and their needs can be met. 
(1) Prior to admitting a resident, facility staff must discuss and explain the 
disclosure statement with the family or responsible party.
(2) The facility must give the required Texas Department of Human Services (DHS) 
disclosure statement to any individual seeking information about the facility's 
care or treatment of residents with Alzheimer's disease or a related disorder. 
(e) Assessment. The facility must make a comprehensive assessment of each 
resident within 14 days of admission and annually. The assessment must include 
at least the following information: 
(1) medical conditions and medical history; 
(2) physical and mental functional status; 
(3) social history, including, but not limited to, the resident's customary 
routines, behaviors, preferences, and needs; 
(4) nutritional status, including weight, and nutritional requirements; 
(5) mental and psychosocial status; and 
(6) activities potential. 
(f) Service plan. Facility staff, with input from the family, if available, must 
develop an individualized service plan for each resident, based upon the 
resident assessment, within 14 days of admission. The service plan must address 
the individual needs, preferences, and strengths of the resident. The service 
plan must be designed to help the resident maintain the highest possible level 
of physical, cognitive, and social functioning.
(g) Activities. A facility must encourage socialization, cognitive awareness, 
self-expression, and physical activity in a planned and structured activities 
program. Activities must be individualized, based upon the resident assessment, 
and appropriate for each resident's abilities. 
(1) The activity program must contain a balanced mixture of activities 
addressing cognitive, recreational, and activity of daily living (ADL) needs. 
(A) Cognitive activities include, but are not limited, to arts, crafts, story 
telling, poetry readings, writing, music, reading, discussion, reminiscences, 
and reviews of current events. 
(B) Recreational activities include all socially interactive activities, such as 
board games and cards, and physical exercise. Care of pets is encouraged. 
(C) Self-care ADLs include grooming, bathing, dressing, oral care, and eating. 
Occupational ADLs include cleaning, dusting, cooking, gardening, and yard work. 
Residents must be allowed to perform self- care ADLs as long as they are able to 
promote independence and self worth. 
(2) Residents must be encouraged, but never forced, to participate in 
activities. Residents who choose not to participate in a large group activity 
must be offered at least one small group or one-on-one activity per day. 
(3) Facilities must have an employee responsible for leading activities. 
(A) Facilities with 16 or fewer residents must designate an employee to plan, 
supply, implement, and record activities. 
(B) Facilities with 17 or more residents must employ, at a minimum, an activity 
director for 20 hours weekly. The activity director must be a qualified 
professional who: 
(i) is a qualified therapeutic recreation specialist or an activities 
professional who is eligible for certification as a therapeutic recreation 
specialist, therapeutic recreation assistant, or an activities professional by a 
recognized accrediting body, such as the National Council for Therapeutic 
Recreation Certification or the National Certification Council for Activity 
Professionals; or 
(ii) has two years of experience in a social or recreational program within the 
last five years, one year of which was full-time in an activities program in a 
health care setting; or 
(iii) has completed an activity director training course approved by the 
National Association for Activity Professionals or the National Therapeutic 
Recreation Society. 
(4) The activity director or designee must review each resident's medical and 
social history, preferences, and dislikes, in determining appropriate activities 
for the resident. Activities must be tailored to the residents' unique 
requirements and skills. 
(5) The activities program must provide opportunities for group and individual 
settings. On weekdays, each resident must be offered at least one cognitive 
activity, two recreational activities and three ADL activities each day. The 
cognitive and recreational activities (structured activities) must be at least 
30 minutes in duration, with a minimum of six and a half hours of structured 
activity for the entire week. At least an hour and a half of structured 
activities must be provided during the weekend and must include at least one 
cognitive activity and one physical activity. 
(6) The activity director or designee must create a monthly activities schedule. 
Structured activities should occur at the same time and place each week to 
ensure a consistent routine within the facility. 
(7) The activity director or designee must annually attend at least six hours of 
continuing education regarding Alzheimer's disease or related disorders. 
(8) Special equipment and supplies necessary to accommodate persons with a 
physical disability or other persons with special needs must be provided as 
appropriate. 
(h) Physical Plant. Alzheimer's units, if segregated from other parts of the 
Type "B" facility with approved security devices, must meet the following 
requirements within the Alzheimer's unit. 
(1) Resident living area(s) must be in compliance with sec.92.62(l)(3) of this 
title (relating to General Requirements). 
(2) Resident dining area(s) must be in compliance with sec.92.62(l)(4) of this 
title. 
(3) Resident toilet and bathing facilities must be in compliance with 
sec.92.62(l)(2) of this title. 
(4) A monitoring station must be provided within the Alzheimer's unit with a 
writing surface such as a desk or counter, chair, task illumination, telephone 
or intercom, and lockable storage for resident records. 
(5) Access to at least two approved exits remote from each other must be 
provided in order to meet the Life Safety Code requirements.
(6) In large facilities, cross corridor control doors, if used for the security 
of the residents, must be similar to smoke doors, which are each 34 inches in 
width and swing in opposite directions. A latch or other fastening device on a 
door must be provided with a knob, handle, panic bar, or other simple type of 
releasing device. 
(7) An outdoor area of at least 800 square feet must be provided in at least one 
contiguous space. This area must be connected to, be a part of, be controlled 
by, and be directly accessible from the facility.
(A) Such areas must have walls or fencing that do not allow climbing or present 
a hazard and meet the following requirements. These minimum dimensions do not 
apply to additional fencing erected along property lines or building setback 
lines for privacy or to meet requirements of local building authorities. 
(i) Minimum distance of the enclosure fence from the building is 8 feet if the 
fence is parallel to the building and there are no window openings; 
(ii) Minimum distance of the enclosure fence (parallel with building walls) from 
bedroom windows is 20 feet if the fencing is solid and 15 feet from bedroom 
windows if the fencing is open; or 
(iii) For unusual or unique site conditions, areas of enclosure may have 
alternate configurations with DHS approval. 
(B) Access to at least two approved exits remote from each other must be 
provided from the enclosed area in order to meet the Life Safety Code 
requirements. 
(C) If the enclosed area involves a required exit from the building, the 
following additional requirements must be met: 
(i) A minimum of two gates must be remotely located from each other if only one 
exit is enclosed. If two or more exits are enclosed by the fencing and entry 
access can be made at each door, a minimum of one gate is required. 
(ii) The gate(s) must be located to provide a continuous path of travel from the 
building exit to a public way, including walkways of concrete, asphalt, or other 
approved materials. 
(iii) If gate(s) are locked, the gate nearest the exit from the building must be 
locked with an electronic lock that operates the same as electronic locks on 
control doors and/or exit doors and is in compliance with the National 
Electrical Code for exterior exposure. Additional gates may also have electronic 
locks or may have keyed locks provided staff carry the keys. 
(8) Locking devices may be used on the control doors provided the following 
criteria are met. 
(A) The building must have an approved sprinkler system and an approved fire 
alarm system to meet the licensing standards. 
(B) The locking device must be electronic and must be released when the 
following occurs: 
(i) activation of the fire alarm or sprinkler system; 
(ii) power failure to the facility; or 
(iii) pressing a button located at the monitoring station and at the main staff 
station. 
(C) A key pad or buttons may be located at the control doors for routine use by 
staff for service. 
(9) Locking devices may be used on the exit doors provided: 
(A) the locking arrangements meet sec.5-2.1.6 of the Life Safety Code; or, 
(B) the following criteria are met: 
(i) The building must have an approved sprinkler system and an approved fire 
alarm system to meet the licensing standards. 
(ii) The locking device must be electro-magnetic; that is, no type of throw-bolt 
is to be used. 
(iii) The device must release when the following occurs: 
(I) activation of the fire alarm or sprinkler system; 
(II) power failure to the facility; or 
(III) a switch located at the monitoring station and at the main staff station 
is activated. 
(iv) A key pad or buttons may be located at the control doors for routine use by 
staff for service. 
(v) A manual fire alarm pull must be located within 5 feet of each exit door 
with a sign stating, "Pull to release door in an emergency."
(vi) Staff must be trained in the methods of releasing the door device. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 29, 1998.
TRD-9808730
Glenn Scott
General Counsel, Legal Services
Texas Department of Human Services
Proposed date of adoption: October 1, 1998
For further information, please call: (512) 438-3765

PART III. Texas Commission on Alcohol and Drug Abuse
CHAPTER 143.Awards
SUBCHAPTER A.Funding Mechanisms
40 TAC sec.sec.143.1-143.12, 143.15, 143.18, 143.19, 143.31, 143.32
(Editor's note: The text of the following sections proposed for repeal will not 
be published. The sections may be examined in the offices of the Texas 
Commission on Alcohol and Drug Abuse or in the Texas Register office, Room 245, 
James Earl Rudder Building, 1019 Brazos Street, Austin.)
The Texas Commission on Alcohol and Drug Abuse proposes the repeal of 
sec.sec.143.1-143.12, 143.15, 143.18, 143.19, 143.31 and 143.32, concerning 
procedures for awarding funds for services. These sections describe 
applicability, allocation of funds, selection criteria, advertisement, request 
for proposals, application, application information, application criteria, 
screening, peer review, funding decisions, cancellation or suspension of 
solicitation, noncompetitive renewal, the annual report card, application 
cycles, emergency purchase, and unsolicited proposals. The repeal is proposed to 
allow the adoption of updated rules following a comprehensive review of the 
agency's funding processes. 
Terry Bleier, Executive Director, has determined that for the first five-year 
period the repeal is in effect there will be no fiscal implications for state or 
local government as a result of the proposed repeal. 
Ms. Bleier also has determined that for each year of the first five years the 
repeal is in effect the public benefit anticipated will be a more effective 
process for the procurement of services. There will be no effect on small 
businesses. There is no anticipated economic cost to current providers.
Comments on the proposal may be submitted to Tamara Allen, Program Compliance, 
Texas Commission on Alcohol and Drug Abuse, 9001 North IH 35, Suite 105, Austin, 
Texas 78753. 
The repealed sections are proposed under the Texas Health and Safety Code, 
sec.461.012(15) which provides the Texas Commission on Alcohol and Drug Abuse 
with the authority to adopt rules governing the functions of the commission, 
including rules that prescribe the policies and procedures followed by the 
commission in administering any commission programs. 
The code affected by the proposed repeal is the Texas Health Safety Code, 
Chapter 461. 
sec.143.1. Applicability.
sec.143.2.Allocation of Funds. 
sec.143.3.Selection Criteria.
sec.143.4.Advertisement. 
sec.143.5.Request for Proposals (RFP). 
sec.143.6.Application. 
sec.143.7.Application Information. 
sec.143.8.Application Criteria. 
sec.143.9.Screening. 
sec.143.10.Peer Review. 
sec.143.11.Funding Decisions. 
sec.143.12.Cancellation or Suspension of Solicitation.
sec.143.15.Noncompetitive Renewal. 
sec.143.18.Annual Report Card. 
sec.143.19.Application Cycles. 
sec.143.31.Emergency Purchase. 
sec.143.32.Unsolicited Proposals.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on June 1, 1998.
TRD-9808959
Mark S. Smock
Deputy for Finance and Administration
Texas Commission on Alcohol and Drug Abuse
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 349-6794

CHAPTER 143.Funding
SUBCHAPTER A.Funding Mechanisms
40 TAC sec.sec.143.1, 143.2, 143.11-143.18, 143.21-143.24
The Texas Commission on Alcohol and Drug Abuse proposes new sec.sec.143.1, 
143.2, 143.11-143.18, and 143.21-143.24, concerning methods of funding. The new 
sections describe applicability of the rules, the allocation of funds, selection 
criteria, advertisement, requests for proposal, application, application 
criteria, peer review, funding decisions, cancellation or suspension of 
solicitations, developmental funding, noncompetitive funding, emergency 
purchase, and noncompetitive renewal. These new sections are proposed to update 
current provisions proposed for repeal. 
Terry Faye Bleier, Executive Director, has determined that for the first five-
year period the new sections are in effect there will be no fiscal implications 
for state or local government as a result of enforcing the new sections.
Ms. Bleier also has determined that for each year of the first five years the 
new sections are in effect the public benefit anticipated as a result of 
enforcing the new sections will be greater clarity in the competitive funding 
process and increased opportunities for participation in the developmental 
process. There will be no effect on small businesses. There is no anticipated 
economic cost to persons required to comply with the proposed new rules. 
Comments on the proposal may be submitted to Tamara Allen, Program Compliance, 
Texas Commission on Alcohol and Drug Abuse, 9001 North IH 35, Suite 105, Austin, 
Texas 78753-5233. 
The new sections are proposed under the Texas Health and Safety Code, 
sec.461.012(15) which provides the Texas Commission on Alcohol and Drug Abuse 
with the authority to adopt rules governing the functions of the commission, 
including rules that prescribe the policies and procedures followed by the 
commission in administering any commission programs. 
The code affected by the proposed new sections is the Texas Health Safety Code, 
Chapter 461.

sec.143.1. Applicability.
The rules in this chapter apply to actions occurring after the date of adoption 
that pertain to funds allocated for client services in Fiscal Year 1999 and 
beyond that have not been exempted through an executive order identifying the 
reason for the exception and the procedures to be applied.

sec.143.2. Allocation of Funds. 
(a) Funds available for regional services are allocated to each of the 11 Health 
and Human Services Commission (HHSC) regions through a statewide formula 
approved by the board of commissioners. The commission may apply the formula to 
identified subregions to ensure more equitable distribution of funds. 
(b) Funds for specific categories of service are allocated regionally or 
subregionally unless exempted through an executive order. 
(c) The commission establishes terms and conditions needed to fulfill state and 
federal funding mandates. 
(d) The commission notifies the Regional Advisory Consortia (RAC) of estimated 
available funds and any terms and conditions. The Regional Advisory Consortia 
have an opportunity to make recommendations regarding service needs and 
priorities unless the funds must be dispersed immediately. 
(e) The commission develops goals and identifies services to be purchased based 
on its statewide service delivery plan and RAC recommendations for regional 
services.

sec.143.11. Selection Criteria.
(a) The commission develops selection criteria for each request for proposals 
that reflect the identified goals and applicable state and federal mandates. 
Selection criteria are designed to select applications that provide the best 
overall value to the state. 
(b) The selection criteria include: 
(1) program quality as determined by the peer review process; and 
(2) the cost of the proposed service. 
(c) The commission may consider additional factors in determining best value as 
specified in Texas Government Code sec.2155.144, including:
(1) financial ability to perform services; 
(2) state investment in the applicant; 
(3) regional service needs and priorities; 
(4) access for underserved areas and populations; 
(5) ability to fit within a regional continuum of services;
(6) past performance, outcomes, and compliance; and 
(7) results of on-site reviews. 
(d) Selection criteria include the scoring system(s) to be used, the weight 
assigned to each factor, and the minimum score required for funding. 
(e) Selection criteria are approved by the board of commissioners and listed in 
the request for proposals. 

sec.143.12. Advertisement. 
(a) The commission publishes a notice of the intent to purchase services through 
a competitive process on the commission's website, on the state's electronic 
business daily, and in the Texas Register. The notice includes:
(1) the service to be purchased; 
(2) the geographic area to be served; 
(3) funding limitations; 
(4) method of payment; 
(5) contract period; 
(6) any limitations on who is eligible to submit an application;
(7) the requirements and deadline for submitting a letter of intent; and 
(8) the procedure the commission will use to award the contract. 
(b) In order to be eligible to compete, applicants who are not already funded by 
the commission must submit specified information and documents with the letter 
of intent. These documents must be received at the commission by the specified 
deadline. Requested information may include, but is not limited to: 
(1) identifying information; 
(2) documentation of legal basis for operation; 
(3) ownership or control information; 
(4) information on business transactions and relationships;
(5) information on financial status; and 
(6) information on persons convicted of crimes. 
(c) An applicant shall also disclose to the commission in writing any pending or 
threatened litigation that might prevent the applicant from meeting contract 
requirements, if funded. This includes but is not limited to: 
(1) an action, suit, or proceeding before any court or governmental body, 
including environmental and civil rights matters; and 
(2) employee labor disturbances. 
(d) The commission will issue a request for proposals if at least two eligible 
applicants submit a letter of intent by the specified deadline.
(e) The commission notifies applicants eliminated through the screening process 
within 45 days of the submission deadline. 

sec.143.13. Request for Proposals (RFP).
The request for proposals includes:
(1) goals describing the purpose of the funds; 
(2) a clear and accurate description of the services to be purchased; 
(3) all requirements that must be met for an application to be considered; 
(4) an estimate of the funds available; 
(5) applicable priorities and restrictions; 
(6) application forms, formats, instructions, procedures, and timeframes; 
(7) the selection criteria and the process used to evaluate proposals and select 
award recipients; and 
(8) the availability of technical assistance.

sec.143.14. Application. 
(a) An organization shall apply for funding using forms, formats, instructions, 
timeframes, and procedures specified by the commission in the RFP and shall 
provide all requested information. 
(b) The application shall be signed by the organization's authorized official. 
(c) Applicants seeking financial assistance from the commission shall comply 
with the Texas Review and Comment System (TRACS) as described in the request for 
proposal. A favorable Texas Review and Comment System recommendation is not 
required for applicants to submit proposals to the commission. 
(d) Applications shall be submitted by mail or in person. The commission does 
not accept applications by facsimile or electronic transmission.
(e) Applications shall be received at the commission by the date and time stated 
in the request for proposal. Late applications will not be accepted under any 
circumstances. The commission will not consider any material related to an 
application (except for Texas Review and Comment System comments) that is 
received after the due date during the competitive process.

sec.143.15. Application Criteria.
(a) An application shall not be considered for competitive funding unless the 
applicant meets the following criteria on the application due date and continues 
to meet them throughout the selection and funding process.
(1) The applicant shall be established as a legal entity under state or federal 
statutes and regulations. 
(2) Applicants seeking funding for treatment services shall be licensed to 
provide the requested services (detox, residential, or outpatient) to the 
proposed target population. 
(3) The applicant shall be in compliance with any commission agreed order. 
(4) The applicant shall be registered to do business in Texas and shall have a 
Texas address. A post office box address may be used when the application is 
submitted, but the applicant must be able to conduct business out of a physical 
location in Texas before funds will be released. 
(5) Staff members, including the executive director, shall not serve on the 
governing board of a public or nonprofit entity. 
(6) The applicant shall be in good standing with any State or Federal agency 
that has a contracting relationship with the applicant. If a State or Federal 
agency has suspended or terminated an applicant's contract for deficiencies in 
performance of the contract, that applicant is not eligible to apply through a 
request for proposals unless all issues have been satisfactorily resolved as 
demonstrated by written documentation from the State or Federal agency. 
Additionally, an applicant is not eligible if it is debarred from participation 
in any federal assistance program. 
(7) Applicants who have previously been funded by the commission shall be in 
compliance with the following requirements: 
(A) if the applicant has been suspended or terminated by the commission at any 
time in the past all issues shall be satisfactorily resolved (demonstrated by 
written documentation from the commission); 
(B) if the applicant owes a refund to the commission, the applicant shall be on 
schedule with the terms of the repayment agreement;
(C) the applicant shall have submitted an annual audit as required by the grant 
agreement or contract and either corrected all deficiencies or submitted and 
maintained compliance with a corrective action plan that the commission has 
accepted. 
(b) The commission may establish additional eligibility standards in a request 
for proposals or other form of solicitation. 
(c) Providers shall continue to meet application criteria after funds are 
awarded or be subject to sanctions. 
(d) The commission may deny funding to an applicant if any person who has an 
ownership or controlling interest in the applicant organization, or who is an 
agent or managing employee of the applicant, has been convicted of a criminal 
offense related to involvement in any program established under Medicare, 
Medicaid, or the Title XX block grant. 
(e) The commission may refuse to fund an applicant who cannot demonstrate that 
the location where services will be provided is in compliance with all 
applicable local and state zoning, building, health, fire, and safety standards.

sec.143.16. Peer Review.
(a) The commission uses peer reviewers to evaluate the quality of applications. 
(b) The commission solicits applications from professionals to serve as peer 
reviewers. Peer reviewers shall demonstrate appropriate training and experience 
and shall not have a conflict of interest. 
(c) The commission provides written procedures and training for all peer 
reviewers. 
(d) The peer reviewers score each application according to the review criteria 
stated in the request for proposal.

sec.143.17. Funding Decisions. 
(a) An internal panel of commission staff applies the selection criteria to 
determine which applications will be funded. The panel also recommends the level 
of funding for each application. 
(b) The panel's recommendations are reviewed and approved by the commission's 
executive management team. 
(c) The commission sends successful applicants written notice within 30 days of 
the funding decision. 
(d) The commission may negotiate with selected applicants to determine the terms 
of the contract. To receive a contract, the applicant shall accept any 
additional or special terms and conditions listed in the funding notice and any 
changes in the funding application. Terms and conditions shall be limited to 
items required to ensure compliance with requirements stated in the request for 
proposals and applicable commission rules. 
(e) A provider shall not enter into a contract with the commission if legal 
action that might impact the provider's ability to meet the requirements of the 
contract is pending or threatened. 
(f) The commission notifies unsuccessful applicants in writing within 30 days of 
the funding decision. Upon written request, the commission will provide an 
applicant with written feedback on the applicant's own proposal.
(g) Applicants shall not make public announcements about receipt of commission 
funds until they have received written notification from the commission.

sec.143.18. Cancellation or Suspension of Solicitation.
The commission has the right to reject all offers and cancel a solicitation. 
Reasons for cancellation include: 
(1) the specifications given in the request for proposals were inaccurate, 
inadequate, or ambiguous; 
(2) the services are no longer required; 
(3) the offers received indicate the best overall value for the state can be 
obtained in another way; 
(4) evidence is received that the bids/offers are collusive or were submitted in 
bad faith; 
(5) none of the applicants are considered responsive; and 
(6) funds are no longer available.

sec.143.21. Developmental Funding.
(a) The commission uses the developmental funding process to: 
(1) purchase additional services if service needs and funds remain after a 
competitive request for proposals; 
(2) distribute funds that become available and must be awarded during a contract 
period; and 
(3) consider funding for unsolicited applications. 
(b) Funds available for one-time procurements and funds available for recurring 
services are handled separately. 
(c) Available funds are regionally or subregionally allocated according to the 
statewide formula, unless exempted through executive order.
(d) The commission identifies the goals and services/products to be purchased 
based on its statewide service delivery plan, RAC recommendations, and results 
of the previous Request for Proposals (RFP), as applicable. 
(e) Selection criteria are designed to select applications that provide the best 
overall value to the state. 
(1) Criteria for selection include program quality, cost, and other factors 
relevant for determining best value. 
(2) A minimum score is established for developmental funding. The minimum score 
may be less than the score established for a competitive RFP if the commission 
has the resources necessary to provide appropriate technical assistance. 
(3) Selection criteria for developmental funds are approved by the commission's 
executive director. 
(f) Notice of available funds is published quarterly in the Texas Register and 
monthly on the commission's website and the state's electronic business daily. 
The notice includes:
(1) the services to be purchased; 
(2) the geographic area to be served; 
(3) funding limitations; 
(4) method of payment; 
(5) contract period; 
(6) requirements for submitting an application; and 
(7) the procedure the commission will use to award the contract. 
(g) The commission accepts applications on an ongoing basis, and may also 
consider previously submitted proposals. Applications eliminated during 
competition may be revised and resubmitted for developmental funding.
(h) Unsolicited applications are considered in the same way as other 
applications during this process. Each application is evaluated in
relation to the services to be purchased and the selection criteria. 
(i) Once per quarter, if funds are available for development, the commission 
reviews the applications. 
(1) To be considered for funding, an applicant must meet the application 
criteria listed in sec.143.15 (relating to Application Criteria).
(2) Applicants who are not already funded by the commission must submit 
additional documentation regarding the organization's legal and financial 
status. 
(3) If required, applicants shall comply with the Texas Review and Comment 
System (TRACS). 
(j) Commission staff evaluate and score proposals that were not scored during 
the competitive RFP. RAC members may also serve as reviewers outside their own 
regions. 
(k) An internal selection panel applies the selection criteria to determine 
which applications will be funded. The panel also recommends the level of 
funding for each applicant and establishes conditions and technical assistance 
requirements, as applicable. Technical assistance is mandatory for any 
application with a score less than the minimum score established for a 
competitive RFP. 
(l) The panel's recommendations are reviewed and approved by the commission's 
executive management team. 
(m) Developmental funding will not be available for services that will be 
included in a competitive RFP beginning six months prior to the scheduled RFP.

sec.143.22. Noncompetitive Funding.
(a) The commission may solicit a proposal from only one source if it is not 
feasible to use competitive procedures. 
(b) One of the following must apply: 
(1) A competitive process failed to elicit acceptable bids.
(2) The agency awarding or appropriating the funds to the commission either 
authorized the noncompetitive negotiation or approved the entity to receive 
funds. 
(3) Because of an emergency, it is necessary to proceed without formal 
advertising to avoid delay. 
(4) The material or service to be purchased is available from only one source. 
(c) The commission follows the procedures below: 
(1) A notice that funds are available for the service is published on the 
commission's website, on the state's electronic business daily, and in the Texas 
Register at least 21 days before a contract is signed.
(2) The commission conducts a cost analysis or budget review which includes 
verification of the proposed cost data, the projections of the data, and the 
evaluation of the specific elements of costs and profit (if applicable and 
authorized). 
(3) The commission evaluates the organization and the proposed program in 
relation to federal and state requirements and criteria set by the agency. 
(4) If applicable, the commission obtains consent from federal funding sources 
as required by Office of Management and Budget (OMB) Circular A-102. 
(5) Applicable state regulations, such as the Historically Underutilized 
Business (HUB) Program, will also be followed. 
(d) After a noncompetitive award is made, the commission reserves the right to 
use a competitive process in subsequent years. 

sec.143.23. Emergency Purchase.
(a) Emergency treatment services may be purchased from licensed treatment 
providers on a non-competitive basis when clients will suffer adverse 
consequences unless services are secured immediately. 
(b) The executive director shall approve the transaction, including a statement 
of justification which: 
(1) describes the emergency situation and what caused it;
(2) describes the damage that will occur if needs are not satisfied immediately; 
and 
(3) states why the needs were not or could not be anticipated.
(c) The initial funding period shall last no longer than 90 days. Funding can be 
approved for additional 90-day periods until the emergency no longer exists or a 
provider is selected through other procedures as provided in this chapter. The 
commission has no real or implied commitment to the provider for on-going 
contractual obligations. 
(d) During the first 90-day period, the commission will evaluate the provider in 
relation to federal and state requirements and its own application criteria. If 
the provider does not meet relevant requirements or the commission's application 
criteria, the commission will terminate the services as soon as possible. 
(e) Upon approval by the executive director of an emergency services 
transaction, the commission shall promptly initiate procedures to secure the 
needed services on a long-term basis. 

sec.143.24. Noncompetitive Renewal.
(a) The commission may renew a competitive award if it determines through 
executive order that the best value will be achieved without further 
competition. 
(b) An award may be renewed if: 
(1) the provider maintains required performance standards;
(2) the commission finds a continuing need for the services (relative to other 
services); 
(3) the provider continues to meet eligibility requirements; and 
(4) funds are available to continue the award. 
(c) Renewal of an award is not automatic. The commission may renew an award when 
renewal is authorized and available data indicates the conditions in paragraph 
(b) of this section have been satisfied. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on June 1, 1998.
TRD-9808769
Mark S. Smock
Deputy for Finance and Administration
Texas Commission on Alcohol and Drug Abuse
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 349-6794

CHAPTER 144.<nl>Contract<ol> [Funding] Requirements
SUBCHAPTER A.Definitions
40 TAC sec.144.21
The Texas Commission on Alcohol and Drug Abuse proposes an amendment to 
sec.144.21 concerning general provisions for contract requirements. This section 
contains the definitions used in this chapter. This amendment is proposed to 
differentiate between the terms intervention and prevention by adding a 
definition for intervention and updating the definition of prevention.
Terry Faye Bleier, Executive Director, has determined that for the first five-
year period the rules are in effect there will be no fiscal implications for 
state or local government as a result of enforcing the rules. 
Ms. Bleier also has determined that for each year of the first five years the 
rules are in effect the public benefit anticipated will be more clarity about 
the difference between intervention and prevention programs. There is no 
additional effect on small businesses. There is no anticipated economic cost to 
persons required to comply with the proposed new rules. 
Comments on the proposal may be submitted to Tamara Allen, Program Compliance, 
Texas Commission on Alcohol and Drug Abuse, 9001 North IH 35, Suite 105, Austin, 
Texas 78753-5233. 
The amendment is proposed under the Texas Health and Safety Code, Title 6, 
Subtitle B, sec.461.012(15) which provides the Texas Commission on Alcohol and 
Drug Abuse with the authority to adopt rules governing the functions of the 
commission, including rules that prescribe the policies and procedures followed 
by the commission in administering any commission programs. The code affected by 
the proposed amendment is the Texas Health and Safety Code, Title 6, Subtitle B, 
Chapter 461. 

sec.144.21. Definitions.
The following words and terms, when used in this chapter, shall have the 
following meanings, unless the context clearly indicates otherwise. 
<nl>(1)<ol> Abuse - Any act or failure to act which is done knowingly, 
recklessly or intentionally, including incitement to act, which caused or may 
have caused injury to a client. Injury may include, but is not limited to: 
physical injury, mental disorientation, or emotional harm, whether it is caused 
by physical action or verbal statement. Client abuse includes: any sexual 
activity between facility personnel and a client; corporal punishment; 
nutritional or sleep deprivation; efforts to cause fear; the use of any form of 
communication to threaten, curse, shame, or degrade a client; restraint that 
does not conform with these standards; coercive or restrictive actions taken in 
response to the client's request for discharge or refusal of medication or 
treatment that are illegal or not justified by the client's condition; and any 
other act or omission classified as abuse by the Texas Family Code, sec.261.001. 
<nl>(2)<ol> Adolescent - An individual 13 through 17 years of age whose 
disabilities of minority have not been removed by marriage or judicial decree. 
<nl>(3)<ol> Adult - An individual 18 years of age or older, or an individual 
under the age of 18 whose disabilities of minority have been removed by marriage 
or judicial decree. 
<nl>(4)<ol> Approve - Authorize in writing. 
<nl>(5)<ol> Assessment (treatment) - The process used to gain sufficient 
information to identify, among other things, the participant's strengths, 
problems, and needs as they relate to the use/abuse of alcohol and/or other 
drugs and the risk of contracting or transmitting infectious diseases/sexually 
transmitted diseases. 
<nl>(6)<ol> Case management - Services provided by an accountable staff person 
which include: 
(A) linking a client with needed services; 
(B) helping a client develop skills to use basic community resources and 
services; and 
(C) monitoring and coordinating the services received by a client. 
<nl>(7)<ol> Chemical dependency - The abuse of, psychological or physical 
dependence on, or addiction to alcohol, a toxic inhalant, or any substance 
designated as a controlled substance in the Texas Controlled Substances Act. 
<nl>(8)<ol> Child - An individual under the age of 13. 
<nl>(9)<ol> Client - An individual who has been admitted to a substance abuse 
treatment facility licensed or funded by the commission and is currently 
receiving services. A licensed chemical dependency counselor providing chemical 
dependency services at a facility shall not have a non-professional relationship 
with any client receiving chemical dependency or related services from the 
facility for two years after the client is discharged. 
<nl>(10)<ol> CODAP - Client-Oriented Data Acquisition Process. 
<nl>(11)<ol> Commission - The Texas Commission on Alcohol and Drug Abuse. 
<nl>(12)<ol> Consenter - The individual legally responsible for giving informed 
consent for a client. This may be the client, parent, guardian, or conservator. 
Unless otherwise provided by law, a legally competent adult is his or her own 
consenter. Consenters include adult clients, clients 16 or 17 years of age, and 
clients under 16 years of age admitting themselves for substance abuse 
counseling under the provisions of the Family Code, sec.32.004.
<nl>(13)<ol> Counseling - Assisting an individual or group to develop an 
understanding of problems, define goals, and plan action reflecting the 
individual's or group's interest, abilities, and needs as affected by chemical 
dependency problems. 
<nl>(14)<ol> Counseling session - A scheduled meeting of 30 minutes or longer 
duration where group, individual, or family counseling is provided. 
<nl>(15)<ol> Counselor - A qualified credentialed counselor or a counselor 
intern working under direct supervision. 
<nl>(16)<ol> Counselor intern (CI) - A person pursuing a course of training in 
chemical dependency counseling at a regionally accredited institution of higher 
education or an approved clinical training institution who has been designated 
as a counselor intern by the institution. The activities of a counselor intern 
shall be performed under the direct supervision of a qualified credentialed 
counselor (QCC). 
<nl>(17)<ol> Crisis intervention - Services designed to intervene in situations 
which may or may not involve alcohol and drug abuse, and which may result in a 
crisis if immediate attention is not provided. Services include face-to-face 
individual, family, or group interviews and/or telephone contacts to identify 
the participant's family's needs. 
<nl>(18)<ol> Cultural awareness and sensitivity training - Training to improve 
an individual's ability to understand and interact with persons of a different 
culture. Culture defines the lifestyle of a distinct population and includes 
values, behavioral norms, and patterns of interpersonal relationships. It may be 
based on race, ethnicity, religion, age, gender, sexual orientation, or 
disability. 
<nl>(19)<ol> Documentation - A written record that includes a date and signature 
and provides authenticated evidence to substantiate compliance with standards, 
such as minutes of meetings, memoranda, schedules, notices, logs, records, 
policies, procedures, and announcements. 
<nl>(20)<ol> DSM-IV - The Diagnostic and Statistical Manual of Mental Disorders, 
Fourth Edition-Revised, published by the American Psychiatric Association. 
<nl>(21)<ol> Ensure - To take all reasonable and necessary steps to achieve 
results. 
<nl>(22)<ol> Evaluation program - Written assessment activities, performed 
internally or externally, of a program or a service and its staff, activities, 
and planning process to determine whether program or service goals are met, 
staff and activities are efficient and effective, and whether or not a program 
or service has any effect on the problem which it was created to address and/or 
on the population which it was created to serve. 
<nl>(23)<ol> Exploitation - An act or process to use, either directly or 
indirectly, the labor or resources of a client for monetary or personal benefit, 
profit, or gain of another individual or organization.
<nl>(24)<ol> Family - The parents, brothers, sisters, other relatives, foster 
parents, guardians, or significant others who perform the roles and functions of 
family members in the lives of clients/participants.
<nl>(25)<ol> Financial assistance - A payment mechanism where payment is made 
based on an approved line item budget. 
<nl>(26)<ol> HIV - Human Immunodeficiency Virus. 
<nl>(27)<ol> Intervention - A process that utilizes multiple strategies designed 
to interrupt the illegal use of alcohol, tobacco and other drugs by youth and to 
break the cycle of harmful use of legal substances and all use of illegal 
substances by adults in order to halt the progression and escalation of use, 
abuse, and related problems. Intervention strategies target indicated 
populations. 
<nl>(28)<ol> Intervention counseling - The process of assisting individuals, 
families, and groups to identify, understand, and resolve issues and problems 
related to substance abuse in order to intervene in problem situations and high 
risk behaviors associated with substance abuse which, if not addressed, may 
escalate to substance abuse or severe impairment.
<nl>(29)<ol> Life skills training - A formalized program of training, based upon 
a written program description, to assist the client in acquiring personal 
habits, attitudes, values, and social interaction skills that will enable the 
client to function effectively and/or become gainfully employed. It includes 
instruction in communication, stress management, problem solving, daily living, 
and decision making. 
<nl>(30)<ol> Neglect - Actions resulting from inattention, disregard, 
carelessness, ignoring, or omission of reasonable consideration that caused, or 
might have caused, physical or emotional injury to a client. Examples of neglect 
include, but are not limited to, failure to provide adequate nutrition, 
clothing, or health care; failure to provide a safe environment free from abuse; 
failure to maintain adequate numbers of appropriately trained staff; failure to 
establish or carry out an appropriate individualized treatment plan; and any 
other act or omission classified as neglect by the Texas Family Code, 
sec.261.001. 
<nl>(31)<ol> Offer - To make available. 
<nl>(32)<ol> OMB - Office of Management and Budget.
<nl>(33)<ol> Outcome - The impact on the system or client/participant served. 
<nl>(34)<ol> Prevention - A process that utilizes multiple strategies designed 
to preclude the onset of the illegal use of alcohol, tobacco and other drugs by 
youth. Prevention principles and strategies foster the development of social and 
physical environments that facilitate healthy, drug-free lifestyles. Prevention 
strategies target universal and selected populations. [Prevention - A proactive, 
inclusive process which seeks the strengthening and empowerment of individuals, 
families, and communities to create conditions that promote health and well-
being by enhancing resiliency and protective factors.] 
<nl>(35)<ol> Program - A system of service delivery consisting of a specific 
type of service delivered to a specific population as identified in the 
proposal. 
<nl>(36)<ol> Protective factors - Those characteristics within social systems, 
such as family, schools, peer groups, that foster resiliency and include high 
expectations, caring and support, and the opportunity to be involved. 
<nl>(37)<ol> Provide - To perform or deliver. 
<nl>(38)<ol> Provider - A distinct legal entity with an administrative and 
functional structure organized to deliver substance abuse services. 
<nl>(39)<ol> Qualified credentialed counselor (QCC) - A licensed chemical 
dependency counselor or one of the professionals listed below who can 
demonstrate two years of chemical dependency counseling experience or one year 
of chemical dependency counseling experience and 90 clock hours (six semester 
hours) of chemical dependency training including the 12 core functions from an 
accredited college or university or an education provider approved by the 
commission. Documentation shall be available upon request. The following 
professionals are eligible to serve as QCCs: 
(A) licensed professional counselor (LPC); 
(B) licensed master social worker (LMSW); 
(C) licensed marriage and family therapist (LMFT); 
(D) licensed psychologist; 
(E) licensed physician; 
(F) certified addictions registered nurse (CARN); 
(G) licensed psychological associate; and 
(H) advance practice nurse recognized by the Board of Nurse Examiners as a 
clinical nurse specialist or nurse practitioner with a specialty in psyche-
mental health (APN-P/MH). 
<nl>(40)<ol> Staff - Individuals hired directly by a provider to provide 
services for the provider in exchange for money or other compensation. 
<nl>(41)<ol> STDs - Sexually transmitted diseases.
<nl>(42)<ol> Substance abuse - The use of one or more drugs, including alcohol, 
which significantly and negatively impacts one or more major areas of life 
functioning. 
<nl>(43)<ol> TAC - Texas Administrative Code. 
<nl>(44)<ol> Treatment (chemical dependency) - A planned, structured, and 
organized program designed to initiate and promote a person's chemical-free 
status or to maintain the person free of illegal drugs. 
<nl>(45)<ol> Unit cost - A payment mechanism in which a specified rate of 
payment is made in exchange for a specified unit of services.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on June 1, 1998.
TRD-9808770
Mark S. Smock
Deputy for Finance and Administration
Texas Commission on Alcohol and Drug Abuse
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 349-6794

SUBCHAPTER B.Contract Administration
40 TAC sec.sec.144.101, 144.104, 144.107, 144.121, 144.124, 144.125, 144.133, 
144.142
The Texas Commission on Alcohol and Drug Abuse proposes amendments to 
sec.sec.144.101, 144.104, 144.107, 144.121, 144.124, 144.133 and 144.142, and 
new sec.144.125, concerning contract administration. These sections describe the 
contract acceptance process, matching prevention awards, reporting requirements, 
the application of federal and state regulations, requirements related to 
indirect costs, Medicaid requirements, allowable travel costs, and the 
subcontracting process. These amendments are proposed to expedite the contract 
acceptance process, incorporate intervention services, update the name of 
referenced federal publications, ensure compliance with federal requirements, 
add a new requirement regarding Medicaid services, and clarify which travel 
provisions apply to what type of entity. 
Terry Faye Bleier, Executive Director, has determined that for the first five-
year period the rules are in effect there will be no fiscal implications for 
state or local government as a result of enforcing the rules. 
Ms. Bleier also has determined that for each year of the first five years the 
rules are in effect the public benefit anticipated will be more effective 
administration of contracts. There is no additional effect on small businesses. 
There is no anticipated economic cost to persons required to comply with the 
proposed new rules. 
Comments on the proposal may be submitted to Tamara Allen, Program Compliance, 
Texas Commission on Alcohol and Drug Abuse, 9001 North IH 35, Suite 105, Austin, 
Texas 78753-5233. 
The amendment is proposed under the Texas Health and Safety Code, Title 6, 
Subtitle B, sec.461.012(15) which provides the Texas Commission on Alcohol and 
Drug Abuse with the authority to adopt rules governing the functions of the 
commission, including rules that prescribe the policies and procedures followed 
by the commission in administering any commission programs. 
The code affected by the proposed amendment is the Texas Health and Safety Code, 
Title 6, Subtitle B, Chapter 461. 

sec.144.101.Contract Acceptance.
(a) To execute a contract, the provider shall submit an original acceptance 
notice signed by <nl>an official authorized to enter into such agreements on 
behalf of the governing body <ol>[the chief executive officer, chief financial 
officer, and board chair] within <nl>14 <ol> [45] calendar days of the 
contract's postmark date. <nl> If board approval is required and cannot be 
obtained within 14 days, the provider must submit a written extension request 
before the deadline which includes the date of the scheduled board meeting.<ol> 
[A copy of the board minutes documenting board acceptance of the terms and 
conditions of the contract shall be submitted within 90 calendar days of the 
postmark date.] 
(b)-(d) (No change.)

sec.144.104. Matching Prevention Awards.
(a) Unless waived in writing by the commission, all providers funded to provide 
prevention <nl>or intervention <ol>services shall contribute 5.0% of the award 
amount expended in matching funds. 
(b) Match shall comply with requirements found in the applicable Office of 
Management and Budget (OMB) circulars (as stated in sec.144.121 of this title 
(relating to Application of <nl>State and Federal Regulations <ol>[OMB 
Circulars]). 

sec.144.107. Reporting. 
(a)-(d) (No change.) 
<nl>(e)<ol> <nl> The provider shall submit financial reports on an accrual 
basis.<ol>

sec.144.121. Application of <nl>Federal and State Regulations <ol>[OMB 
Circulars].
(a) Expenditures and administration of commission and match funds shall follow 
guidelines for reasonableness, allowability, and administration according to the 
cost principles and administrative requirements for the appropriate 
organizational structure as specified below: 
(1) state and local governments or Indian Tribal governments shall comply with 
cost principles found in the Uniform Grant [and Contract] Management Standards 
<nl>(UGMS)<ol>; 
(2) not-for-profit providers shall comply with <nl>UGMS as applicable,<ol> cost 
principles found in the Office of Management and Budget (OMB) Circular A-122 and 
administrative requirements found in the Office of Management and Budget 
Circulars Circular A-110 (with changes incorporated as the Code of Federal 
Regulations, Title 45, Part 74); 
(3) (No change.) 
(4) commercial organizations shall comply with <nl>UGMS as applicable,<ol> cost 
principles found in Code of Federal Regulations, Title 48, Part 31, and 
administrative requirements found in OMB Circular A-110 (with changes 
incorporated as the Code of Federal Regulations, Title 45, Part 74); and 
(5) hospitals shall comply with <nl>UGMS as applicable, <ol>cost principles 
found in the Code of Federal Regulations, Title 45, Part 74, and administrative 
requirements found in OMB Circular A-110. 
(b)-(c) (No change.) 
<nl>(d)<ol> <nl> In those instances in which UGMS is more restrictive than OMB 
Circulars A-110 and A-122, the provisions of UGMS shall apply. Circulars A-110 
and A-122 shall apply only to the extent that no counterpart provisions exist in 
UGMS.<ol>

sec.144.124. Indirect Cost.
(a) In order to charge indirect costs, a provider must submit:
(1)-(2) (No change.) 
(3) notice that the provider will use an indirect cost rate of 10% as provided 
in the Uniform Grant [and Contract] Management Standards (<nl>UGMS <ol>[UGCMS]). 
The notice must include supporting documentation to show the direct salary and 
wage costs of providing the service (excluding overtime, shift premiums, and 
fringe benefits). This option shall be available only if included in <nl>UGMS 
<ol>[UGCMS]. 
(b) (No change.) 

sec.144.125. Medicaid. 
Any provider offering services which are eligible for Medicaid reimbursement 
shall become a Medicaid provider and bill Medicaid for all covered services.

sec.144.133.Travel.
(a) (No change.) 
(b) Costs for lodging, meals, and related items may not exceed <nl> the State of 
Texas per diem rates or the <ol>federal per diem guidelines, <nl> as 
applicable<ol>. If the provider's policies and procedures establish a lower per 
diem rate, the lower rate shall apply. 
(c) (No change.) 

sec.144.142. Subcontracting. 
(a)-(g) (No change.) 
(h) Subcontractors must also comply with all applicable state and federal laws 
and regulations and commission requirements contained in the commission's rules. 
These specifically include the audit requirements of Office of Management and 
Budget (OMB) Circular A-133 if applicable, and all other OMB Circulars required 
in the sec.144.121 of this title (relating to Application of <nl>Federal and 
State Regulations <ol>[OMB Circulars
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on June 1, 1998.
TRD-9808774
Mark S. Smock
Deputy for Finance and Administration
Texas Commission on Alcohol and Drug Abuse
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 349-6794

SUBCHAPTER C.Audits
40 TAC sec.144.214
The Texas Commission on Alcohol and Drug Abuse proposes amendments to 
sec.144.214, concerning submission of audits. This section describes the process 
that providers must follow in submitting audits to the commission. The 
amendments are proposed to implement changes in applicable federal regulations.
Terry Faye Bleier, Executive Director, has determined that for the first five-
year period the rules are in effect there will be no fiscal implications for 
state or local government as a result of enforcing the rules. 
Ms. Bleier also has determined that for each year of the first five years the 
rules are in effect the public benefit anticipated will be compliance with 
applicable federal regulations regarding audit submissions. There is no 
additional effect on small businesses. There is no anticipated economic cost to 
persons required to comply with the proposed new rules. 
Comments on the proposal may be submitted to Tamara Allen, Program Compliance, 
Texas Commission on Alcohol and Drug Abuse, 9001 North IH 35, Suite 105, Austin, 
Texas 78753-5233. 
The amendment is proposed under the Texas Health and Safety Code, Title 6, 
Subtitle B, sec.461.012(15) which provides the Texas Commission on Alcohol and 
Drug Abuse with the authority to adopt rules governing the functions of the 
commission, including rules that prescribe the policies and procedures followed 
by the commission in administering any commission programs. 
The code affected by the proposed amendment is the Texas Health and Safety Code, 
Title 6, Subtitle B, Chapter 461.

sec.144.214.Audit Submission.
(a) (No change.) 
(b) <nl>Audit documentation must be submitted within 30 calendar days after 
completion of the audit. Audits for fiscal years ending July 31, 1998 and after 
shall be completed and submitted no later than nine months after the provider's 
fiscal year end. Audits for fiscal years ending before July 31, 1998 must be 
completed and submitted no later than 13 months after the provider's fiscal year 
end.<ol> [Audit documentation must be submitted within 30 calendar days after 
completion of the audit, and the audit shall be completed no later than one year 
after the end of the provider's fiscal year-end.] 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on June 1, 1998.
TRD-9808776
Mark S. Smock
Deputy for Finance and Administration
Texas Commission on Alcohol and Drug Abuse
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 349-6794

SUBCHAPTER D.Organization
40 TAC sec.144.313, sec.144.322
The Texas Commission on Alcohol and Drug Abuse proposes amendments to 
sec.144.313 and sec.144.322, concerning organizational requirements for 
providers. These sections describe requirements for the governing authority and 
record retention requirements. The amendments are proposed to clarify which 
entities are prohibited from having a staff member on the governing board and to 
specify the record retention requirements for currently funded providers. 
Terry Faye Bleier, Executive Director, has determined that for the first five-
year period the rules are in effect there will be no fiscal implications for 
state or local government as a result of enforcing the rules. 
Ms. Bleier also has determined that for each year of the first five years the 
rules are in effect the public benefit anticipated will be compliance with 
applicable state and federal regulations regarding governing boards and records 
retention. There is no additional effect on small businesses. There is no 
anticipated economic cost to persons required to comply with the proposed new 
rules. 
Comments on the proposal may be submitted to Tamara Allen, Program Compliance, 
Texas Commission on Alcohol and Drug Abuse, 9001 North IH 35, Suite 105, Austin, 
Texas 78753-5233. 
The amendment is proposed under the Texas Health and Safety Code, Title 6, 
Subtitle B, sec.461.012(15) which provides the Texas Commission on Alcohol and 
Drug Abuse with the authority to adopt rules governing the functions of the 
commission, including rules that prescribe the policies and procedures followed 
by the commission in administering any commission programs. The code affected by 
the proposed amendment is the Texas Health and Safety Code, Title 6, Subtitle B, 
Chapter 461.

sec.144.313. Governing Authority. 
(a)-(b) (No change.) 
(c) <nl>Staff members, including the executive director, shall not serve on the 
governing board of a public or nonprofit entity.<ol>[If the governing authority 
is a governing board, a staff member shall not serve as a voting member of the 
board.] 
(d)-(f) (No change.)

sec.144.322. Records.
(a)-(b) (No change.) 
(c) <nl>The provider shall maintain all records relating to the contract for at 
least three years from the date the final audit report is due. If any 
litigation, audit, or other action is in process at the end of three years, the 
records must be kept until the action is resolved.<ol> If a provider closes 
business operations, it shall ensure that records relating to the contract are 
securely stored and accessible for at least three years. The provider shall 
provide the commission with the name and address of the responsible party. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on June 1, 1998.
TRD-9808778
Mark S. Smock
Deputy for Finance and Administration
Texas Commission on Alcohol and Drug Abuse
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 349-6794

SUBCHAPTER E.Prevention <nl>and Intervention<ol>
40 TAC sec.sec.144.401, 144.411-144.416, 144.433, 144.447
The Texas Commission on Alcohol and Drug Abuse proposes amendments to 
sec.sec.144.401, 144.411-144.415, 144.433 and 144.447, and new sec.144.416, 
concerning requirements for funded prevention and intervention programs. These 
sections describe applicability of these rules, program design and 
implementation, program self-evaluation, performance and activity measures, the 
performance measure review process, participant rights, requirements related to 
smoking, prevention resource centers and additional services that may be 
offered. These amendments are proposed to incorporate intervention programs 
throughout; to clarify which entities must complete a program self-evaluation 
and the difference in requirements for first and subsequent years; to update 
terminology; to clarify the performance measure review process; to make the 
smoking policy requirements for treatment providers apply to prevention and 
intervention programs as well; to indicate that environmental social policy is 
optional for prevention resource centers; and to emphasize the importance of 
family services in these programs. 
Terry Faye Bleier, Executive Director, has determined that for the first five-
year period the rules are in effect there will be no fiscal implications for 
state or local government as a result of enforcing the rules. 
Ms. Bleier also has determined that for each year of the first five years the 
rules are in effect the public benefit anticipated is more effective prevention 
and intervention programs. There is no additional effect on small businesses. 
There is no anticipated economic cost to persons required to comply with the 
proposed new rules. 
Comments on the proposal may be submitted to Tamara Allen, Program Compliance, 
Texas Commission on Alcohol and Drug Abuse, 9001 North IH 35, Suite 105, Austin, 
Texas 78753-5233. 
The amendment is proposed under the Texas Health and Safety Code, Title 6, 
Subtitle B, sec.461.012(15) which provides the Texas Commission on Alcohol and 
Drug Abuse with the authority to adopt rules governing the functions of the 
commission, including rules that prescribe the policies and procedures followed 
by the commission in administering any commission programs. The code affected by 
the proposed amendment is the Texas Health and Safety Code, Title 6, Subtitle B, 
Chapter 461. 

sec.144.401. Applicability.
The rules in this subchapter apply only to funded programs providing 
prevention<nl> or intervention<ol> services.

sec.144.411. Program Design and Implementation.
(a)-(g) (No change.) 
(h) The program shall be designed to build on and support related prevention 
<nl>and intervention<ol> efforts in the community. The program shall establish 
linkages and coordinate with other community resources.
(i) The program shall establish an annual staff training plan for [prevention 
program] employees based on the program design and identified staff needs. The 
plan must include cultural awareness and sensitivity training for all employees.

sec.144.412. Program Self-Evaluation.
(a) (No change.) 
(b) <nl>Programs required to complete the self-evaluation include Prevention, 
Intervention, Core Council Services, HIV Outreach Services, Infant Primary 
Prevention and Intervention Programs, and Compulsive Gambling. <ol> [Evaluation 
activities shall implement Prevention Plus III unless the commission has 
approved an alternative model. The evaluation process must include:] 
[(1) identification of goals and objectives; 
[(2) assessment of the service delivery process; and] 
[(3) assessment of the program outcomes. 
(c) <nl>Programs shall conduct evaluation activities using the Prevention Plus 
III format unless the commission has approved an alternative model.<ol> [The 
program shall submit a written evaluation report at the end of each contract 
period, no later than September 30th unless otherwise stipulated in the funding 
agreement.] 
(d) <nl>For programs in the first year of funding from the commission, the 
evaluation process must include:<ol> 
<nl>(1)<ol> <nl> identification of goals and objectives (PP III Step 1); <ol>
<nl>(2)<ol> <nl> assessment of the service delivery process (PP III Step 2); and 
<ol>
<nl>(3)<ol> <nl> a plan for assessment of the program outcomes (plan for PP III 
Step 3).<ol> [The program shall use information gained from the annual self-
evaluation to revise the program plan and staff training plan.] 
<nl>(e)<ol> <nl> In subsequent funding years, the evaluation must include: <ol>
<nl>(1)<ol> <nl> identification of goals and objectives (PP III Step 1); <ol>
<nl>(2)<ol> <nl>assessment of the service delivery process (PP III Step 2); and 
<ol>
<nl>(3)<ol> <nl> implementation of the assessment of the program outcomes (PP 
III Step 3). <ol>
<nl>(f)<ol> <nl> The program shall submit a written evaluation report using the 
format specified by the commission. The provider must submit the report at the 
end of each contract period, no later than September 30th unless otherwise 
stipulated in the contract. <ol>
<nl>(g)<ol> <p<nl> The program shall use information gained from the annual 
self-evaluation to revise the program plan and staff training plan.

sec.144.413. Performance and Activity Measures.
(a) Each program shall submit annual <nl>goals<ol> [targets] for anticipated 
numbers of persons to be served during the course of the contract period <nl>for 
key performance measures<ol>. 
(b) <nl>The program <ol>[Prevention programs] shall track and appropriately 
document the performance and activity measures defined for the target population 
and the services provided. The program must maintain adequate documentation to 
substantiate the reported numbers. 
(c) Each program shall submit monthly performance and activity reports based on 
<nl>all<ol>[ the approved targets for] funded activities by the specified due 
date.

sec.144.414.[Select] Performance<nl> Measure Review<ol>[ Measurement Process]. 
(a) <nl>The prevention/intervention program will be held to specific key 
performance measures as stated in the contract.<ol> [The commission shall review 
compliance with targets at least twice each fiscal year and notify the program 
in writing if the program failed to achieve the expected level of performance.] 
(b) <nl>The commission shall review actual performance on key meaures at least 
twice each fiscal year and notify the program in writing if the program failed 
to achieve the expected level of performance.<ol> [The program shall respond to 
the notice within 30 days from the postmark date of the notice.] 
(c) <nl>If the program fails to achieve the expected level of performance, the 
program shall respond within 30 days from the postmark date of the commission's 
written notification. The program must submit a written corrective action plan 
to the commission. The corrective action plan must include the program's method 
and timeframes for correcting or resolving the noted deficiencies. <ol>[After 
receiving the response, the commission shall take one of the following actions.] 
[(1) Negotiate a revision of performance measures with final approval from the 
commission.] 
[(2) Permit a one-time extension of the review period and require submission of 
a corrective action plan to the commission. The corrective action plan must 
include the program's method and timeframes for correcting or resolving the 
noted deficiencies.] 
(d) <nl>After receiving the response, the commission shall take at least one of 
the following actions.<ol> 
<nl>(1)<ol> <nl> Notify the program in writing that the corrective action plan 
has been approved and should be implemented as outlined. <ol>
<nl>(2)<ol> <nl>Negotiate additional corrective actions, a revision of the 
performance goals and/or interim goals, with appropriate timelines established 
to measure progress.<ol> [In subsequent reviews, if the program fails to 
satisfactorily resolve any performance measure deficiencies as noted in the 
commission's review, the commission will implement further corrective action and 
may impose one or more of the following sanctions:
[(1) designation as a high-risk provider; 
[(2) suspension or withholding of payments; 
[(3) one-time decrease in the contract amount for the fiscal year;] 
[(4) permanent decrease in the contract amount; or] 
[(5) termination of the contract.]
<nl>(e)<ol> If the program fails to satisfactorily resolve any performance 
measure deficiencies as noted in the commission's review, the commission will 
implement further corrective action and may impose one or more of the following 
sanctions: 
<nl>(1)<ol> <nl> designation as a high-risk provider; <ol>
<nl>(2)<ol> <nl> suspension of payments; <ol>
<nl>(3)<ol> <nl> one-time decrease in the contract amount for the fiscal year; 
<ol>
<nl>(4)<ol> <nl> permanent decrease in the contract amount; or <ol>
<nl>(5)<ol> <nl> termination of the contract.<ol>

sec.144.415. Participant Rights.
(a)-(b) (No change.) 
(c) Participants in an <nl>intervention<ol>[indicated] program also have the 
right to: 
(1) a humane environment that provides reasonable protection from harm; 
(2) be informed of the program rules and regulations before participation; and 
(3) accept or refuse services after being informed of services and 
responsibilities. 
(d) When participants receive individualized services in an <nl> 
intervention<ol> [indicated prevention] program, the provider shall inform 
participants and consenters (if applicable) about: 
(1) program goals and objectives; 
(2) rules and regulations; and 
(3) participant rights. 
(e) (No change.)

sec.144.416. Smoking Policies.
(a) The program shall prohibit smoking inside program buildings.
<nl>(b)<ol> The program shall not allow vending machines that dispense tobacco 
products on site. 
<nl>(c)<ol> Staff shall not provide, distribute, or facilitate participant 
access to tobacco products. 
<nl>(d)<ol> Staff shall not use tobacco products in the presence of 
participants. 
<nl>(e)<ol> The program shall prohibit adolescents from using tobacco products 
on the program site or during structured program activities.

sec.144.433. Prevention Resource Centers.
(a) (No change.) 
(b) A PRC shall provide all services and functions outlined in the contract and 
report on the following strategies: 
(1)-(2) (No change.) 
(3) environmental social policy <nl>(if applicable)<ol>. 

sec.144.447. Additional Services.
A program may offer additional services to meet the needs of individual 
participants <nl>and their families<ol>, such as intervention counseling, crisis 
intervention, <nl>family case management, <ol>and support group opportunities.
(1) (No change.) 
(2) The program shall assess the individual's <nl>or family's<ol> needs and 
develop a service plan to address the identified needs and the services to be 
provided. 
(3) The program shall document participation and follow-through, including any 
changes in the participant's <nl>or family's <ol>status.
(4) The program shall provide information and referrals for participant 
<nl>and/or<ol> [and] family needs that cannot be met by the program. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on June 1, 1998.
TRD-9808779
Mark S. Smock
Deputy for Finance and Administration
Texas Commission on Alcohol and Drug Abuse
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 349-6794

SUBCHAPTER F.Treatment
40 TAC sec.sec.144.532, 144.542, 144.543, 144.545, 144.551, 144.552, 144.554
The Texas Commission on Alcohol and Drug Abuse proposes amendments to 
sec.sec.144.532, 144.542,144.543, 144.551, 144.552 and 144.554, and new 
sec.144.545, concerning treatment services. These sections describe general 
treatment services, court commitment services, pharmacotherapy services, family 
services, the performance measure review process, select performance measure 
definitions, and Client Oriented Data Acquisition Process (CODAP) reports. These 
amendments are proposed to clarify the limit on clients in group counseling 
sessions, strengthen court commitment requirements to ensure appropriate 
services are provided for suicidal and other high risk patients and that 
reporting related to these is more accurate, to ensure continuity of services 
for pharmacotherapy services, to develop requirements for family services which 
is a newly funded service, to clarify the performance measure review process, to 
revise the definition of abstinence for adults to be consistent with that used 
for adolescents, to add definitions of measures for pharmocotherapy programs, 
and to eliminate the duplication of instructions found in the CODAP manual. 
Terry Faye Bleier, Executive Director, has determined that for the first five-
year period the rules are in effect there will be no fiscal implications for 
state or local government as a result of enforcing the rules. 
Ms. Bleier also has determined that for each year of the first five years the 
rules are in effect the public benefit anticipated is improved treatment 
services. There is no additional effect on small businesses. There is no 
anticipated economic cost to persons required to comply with the proposed new 
rules. 
Comments on the proposal may be submitted to Tamara Allen, Program Compliance, 
Texas Commission on Alcohol and Drug Abuse, 9001 North IH 35, Suite 105, Austin, 
Texas 78753-5233. 
The amendment is proposed under the Texas Health and Safety Code, Title 6, 
Subtitle B, sec.461.012(15) which provides the Texas Commission on Alcohol and 
Drug Abuse with the authority to adopt rules governing the functions of the 
commission, including rules that prescribe the policies and procedures followed 
by the commission in administering any commission programs. 
The code affected by the proposed amendment is the Texas Health and Safety Code, 
Title 6, Subtitle B, Chapter 461. 

sec.144.532. General Treatment Services. 
(a)-(d) (No change.) 
(e) Group size shall be limited to a number that allows effective interaction 
between the group and facilitator and between group members.
(1) <nl>Group counseling sessions are limited to a maximum of 16 clients.<ol> 
[The counselor to client ratio in group counseling shall not exceed one to 16.] 
(2) (No change.) 
(f) (No change.)

sec.144.542. Court Commitment Services.
(a) (No change.) 
(b) The program shall comply with federal and state statutory and regulatory 
provisions that relate to the care and custody of court committed clients. 
<nl>These provisions include:<ol> 
<nl>(1)<ol> <nl> Code of Federal Regulations, Title 42, Part 2-Confidentiality 
of Alcohol and Drug Abuse Patient Records; <ol>
<nl>(2)<ol> <nl>Texas Health and Safety Code, Chapter 462; and <ol>
<nl>(3)<ol> <nl> Texas Administrative Code, Title 40, Chapter 148, as 
applicable, and Chapter 149. <ol>
<nl>(c)<ol> <nl> The program's admission criteria shall not exclude individuals 
who meet the criteria for emergency detention or court ordered chemical 
dependency treatment, including suicidal and homicidal individuals. <ol>
<nl>(d)<ol> <nl> The program shall accept all chemical dependency clients 
brought to the facility under emergency detention, order of protective custody, 
or court-ordered treatment. A general pre-screening and assessment of the 
individual seeking a civil court commitment for chemical dependency may be used 
to determine whether the client may be appropriate for chemical dependency 
treatment. A formal screening and assessment is not required before admission. 
<ol>
<nl>(e)<ol> <nl> The program shall adopt a policy authorizing use of special 
treatment procedures and implement procedures that conform with sec.148.183 
(relating to Special Treatment Procedures) and sec.148.184 (relating to 
Documenting Special Treatment Procedures) of this title. <ol>
<nl>(f)<ol> <nl> The program shall adopt protocols for the stabilization and 
management of suicidal and homicidal clients. <ol>
<nl>(g)<ol> <nl> For reporting purposes, only clients brought to the facility 
pursuant to an emergency detention or court order will be counted as court 
commitment clients. <ol>

sec.144.543. Pharmacotherapy Services. 
(a) (No change.) 
(b) Programs shall establish a phase/level system which is consistent with 
guidelines from the Food and Drug Administration and includes the following 
phases: 
(1) (No change.) 
(2) Phase II: After <nl>45<ol>[90] days of continuous treatment, the client 
shall receive at least two individualized counseling sessions monthly. 
(3) (No change.) 
<nl>(c)<ol> <nl> All Pharmacotherapy programs must conduct the Methadone Annual 
Survey as directed by the Commission.<ol>

sec.144.545. Family Services. 
<nl>(a)<ol> Family services supplement an existing treatment program by 
providing services to the family of the primary client. 
<nl>(b)<ol> Family services shall be designed to improve the health and 
functioning of the family unit and/or to assist individual family members to 
achieve healthy, drug-free life styles. 
<nl>(c)<ol> Family services may be provided to the entire family, individual 
family members, or a subset of family members. Family services may involve any 
prevention, intervention, or treatment service or strategy, including family 
case management. 
<nl>(d)<ol> Family services must be provided by qualified staff who have the 
training and experience needed to perform the specific function. Qualifications 
shall be based on industry standards and applicable licensure requirements. 
<nl>(e)<ol> Family services must be documented in a family file that is linked 
to the file of the primary client. The file must include:
<nl>(1)<ol> a copy of the assessment of the primary client;
<nl>(2)<ol> identification of family needs; 
<nl>(3)<ol> family service plan; 
<nl>(4)<ol> documentation of services delivered; and
<nl>(5)<ol> termination plan. 
<nl>(f)<ol> Each contact must be documented, including:
<nl>(1)<ol> mode of contact; 
<nl>(2)<ol> time spent; 
<nl>(3)<ol> purpose of contact; 
<nl>(4)<ol> content of interaction (as applicable); and 
<nl>(5)<ol> outcome of contact.

sec.144.551. [Select] Performance Measure <nl> Review<ol>[Process]. 
(a) The treatment program will be held to specific performance measures as 
stated in the contract [terms and conditions]. 
(b) (No change.) 
(c) <nl>If the program fails to achieve the expected level of performance, the 
program shall respond within 30 days from the postmark date of the commission's 
written notification. The program must submit a written corrective action plan 
to the commission. The corrective action plan must include the program's method 
and timeframes for correcting or resolving the noted deficiencies. <ol>[The 
program shall respond within 30 days from the postmark date of the commission's 
written notification.]
(d) After receiving the response, the commission shall take <nl> at least<ol> 
one of the following actions. 
(1) <nl>Notify the program in writing that the corrective action plan has been 
approved and should be implemented as outlined. <ol>[Negotiate a revision of 
performance measures with final approval from the commission.] 
(2) <nl>Negotiate additional corrective actions, a revision of the performance 
targets and/or interim targets, with appropriate timelines established to 
measure progress.<ol> [Permit a one-time extension of the review period and 
require submission of a corrective action plan to the commission. The corrective 
action plan must include the program's method and timeframes for correcting or 
resolving the noted deficiencies.] 
(e) <nl>If <ol>[In subsequent reviews, if] the program fails to satisfactorily 
resolve any performance measure deficiencies as noted in the commission's 
review, the commission will implement further corrective action and may impose 
one or more of the following sanctions:
(1) (No change.) 
(2) suspension [or withholding] of payments;
(3)-(5) (No change.)

sec.144.552. Select Performance Measure Definitions. 
(a) (No change.) 
(b) Abstinence. This measure applies to Levels II, III, and IV programs, except 
for pharmacotherapy programs. 
(1) (No change.) 
(2) For adults, abstinence is the percent of adults who report no use of 
<nl>alcohol or drugs <ol>[their primary substance] within the past 30 days when 
contacted 60 days after discharge from the treatment program. For those adults 
who are transferred to another commission-funded level of service within the 
same program (therefore no follow-up is required), abstinence is the percent of 
transferred adults who report no use of alcohol or drugs during the 30 days 
prior to discharge or the duration of treatment, whichever is less. 
(c) (No change.) 
<nl>(d)<ol> <nl> One-Year Retention Rate. This measure applies to Level IV 
Pharmacotherapy programs. The One-Year Retention Rate is the percentage of 
clients admitted within the previous fiscal year who have remained continuously 
active in the program for at least one year. <ol>
<nl>(e)<ol> <nl>Abstinence Rate. This measure applies to Level IV 
Pharmacotherapy programs. The Abstinence Rate is based on the percentage of 
clients with no positive urinalysis for illicit opiates, amphetamines, cocaine, 
and barbiturates in the 90 days prior to the Methadone Annual Survey. This 
calculation excludes recent admissions. <ol>
<nl>(f)<ol> <nl>Employment Rate. This measure applies to Level IV 
Pharmacotherapy programs. The Employment Rate is based on the percentage of all 
active clients employed at the time of the Methadone Annual Survey. This 
calculation excludes recent admissions.<ol>

sec.144.554. CODAP Reports.
(a) All treatment programs shall submit Client Oriented Data Acquisition Process 
(CODAP) reports to the commission on all clients receiving commission-funded 
substance abuse treatment services. [This includes: 
[(1) A CODAP Facility Summary (CFS) for each month of the contract period;] 
[(2) a youth or adult Admission Report (new, readmission, or transfer) for each 
client who will be billed to the commission;] 
[(3) a youth or adult Discharge Report each time a client transfers from one 
commission funded level of service and/or site into another commission funded 
level of service and/or site;
[(4) a youth or adult Discharge Report when the client ceases receiving 
commission-funded services; and] 
[(5) a youth or adult Follow-up Report, which should be completed on each client 
at least 60 days from his or her last face-to-face substance abuse treatment 
contact. (A follow-up report is not required for certain discharge reasons 
listed in the CODAP Reference and Instruction Manual.)] 
(b) (No change.) 
[(c) Each month, the program must verify that all clients appearing on the 
Active Clients List are still receiving a commission-funded level of service. If 
not, a discharge report must be submitted for each client as instructed under 
paragraph (3) or (4) of subsection (a) of this section. 
[(d) Each month, the program shall verify on the CODAP Facility Summary:] 
[(1) that all discharge and follow-up reports due that month (and those due in 
previous months, if applicable) are being transmitted; or] 
[(2) provide clear justification for not transmitting all required reports and 
the date the reports will be transmitted. 
[(e) The program must submit CODAP corrections and/or missing forms listed on 
the CODAP Error Report or CODAP Rejected Forms Report monthly. The corrections 
are due along with the next month's CODAP reports by the due date listed in the 
CODAP Reference and Instruction Manual.
[(f) If a program is terminated, the provider must submit discharge reports for 
all clients that are on the Active Clients List and correct all errors on the 
CODAP Error Reports as directed in the close-out procedures.] 
[(g) If the provider closes a site, but still has other commission-funded 
treatment sites, the provider must submit:]
[(1) discharge reports for all clients that were in the closed site;] 
[(2) follow-up reports on all clients that were discharged from the closed site 
(once 60 days have elapsed from their date of discharge); and] 
[(3) correct errors on CODAP Error Report (if any).] 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on June 1, 1998.
TRD-9808780
Mark S. Smock
Deputy for Finance and Administration
Texas Commission on Alcohol and Drug Abuse
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 349-6794

CHAPTER 145.Faith Based Chemical Dependency Programs
40 TAC sec.145.22
The Texas Commission on Alcohol and Drug Abuse proposes an amendment to 
sec.145.22 concerning registration for exempt faith-based programs. This section 
contains the requirements for a religious organization to register for its 
exemption from facility licensure. This amendment is proposed to provide an 
alternate method to document the organization's purpose as a religious 
organization. 
Terry Faye Bleier, Executive Director, has determined that for the first five-
year period the new sections are in effect there will be no fiscal implications 
for state or local government as a result of enforcing the new sections. Ms. 
Bleier also has determined that for each year of the first five years the new 
sections are in effect the public benefit anticipated will be exemption from 
licensure for faith based chemical dependency programs that are able to use this 
alternate method of documenting their purpose as a religious
organization. There is no additional effect on small businesses. There is no 
anticipated economic cost to persons required to comply with the proposed new 
rules. 
Comments on the proposal may be submitted to Tamara Allen, Program Compliance, 
Texas Commission on Alcohol and Drug Abuse, 9001 North IH 35, Suite 105, Austin, 
Texas 78753-5233. 
The amendment is proposed under the Texas Health and Safety Code, Title 6, 
Subtitle B, Chapter 464, which provides the Texas Commission on Alcohol and Drug 
Abuse with the authority to adopt rules and standards for licensure of chemical 
dependency treatment facilities. 
The code affected by the proposed amendment is the Texas Health and Safety Code, 
Title 6, Subtitle B, Chapter 464.

sec.145.22. Registration for Exempt Faith-Based Programs.
(a) To register its exemption, the religious organization shall complete and 
submit these documents to the commission: 
(1)-(2) (No change.) 
(3) a copy of the <nl>organization's articles of incorporation documenting that 
the primary purpose of the organization is the propagation of religious beliefs 
or a <ol> letter from the State of Texas Comptroller's Office documenting the 
organization's religious tax exemption status. 
(b)-(c) (No change.) 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt. 
Filed with the Office of the Secretary of State, on June 1, 1998.
TRD-9808777
Mark S. Smock
Deputy for Finance and Administration
Texas Commission on Alcohol and Drug Abuse
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 349-6794

PART IV. Texas Commission for the Blind
CHAPTER 165.Facilities Program
40 TAC sec.sec.165.1-165.3
(Editor's note: The text of the following sections proposed for repeal will not 
be published. The sections may be examined in the offices of the Texas 
Commission for the Blind or in the Texas Register office, Room 245, James Earl 
Rudder Building, 1019 Brazos Street, Austin.)
The Texas Commission for the Blind proposes the repeal of sec.sec.165.1-165.3, 
concerning the facilities program. The purpose of the repeal is to eliminate 
rules no longer needed by the Commission in the administration of its programs. 
The rules refer to a facilities program and a facilities manual, which are no 
longer applicable for the purpose of providing vocational rehabilitation 
services to consumers. 
Ernest Pereyra, Deputy Director of Administration and Finance, has determined 
that for the first five years the rules are in effect there will be no fiscal 
implications for state or local government as a result of enforcing or 
administering the repeal. 
Mr. Pereyra has also determined that for each year of the first five years the 
repeal is in effect the public benefits anticipated as a result of the repeal 
will be the elimination of obsolete rules no longer in use. There will be no 
effect on small businesses as a result of the repeal. There is no anticipated 
economic cost to individuals who are required to comply with the repeal. 
Questions about the content of this proposal may be directed to Jean Crecelius 
at (512) 459-2611, and written comments on the proposal may be submitted to 
Policy and Rules Coordinator, P. O. Box 12866, Austin, Texas 78711, within 30 
days from the date of this publication.
The repeals are proposed under the Human Resources Code, Title 5, Chapter 91, 
which authorizes the commission to adopt rules prescribing the policies and 
procedures followed by the commission in the administration of its programs. 
The repeals affect no statutes.
sec.165.1.General Policy.
sec.165.2.Public Access to Internal Procedural Documents. 
sec.165.3.Facilities Manual.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 29, 1998.
TRD-9808715
Terrell I. Murphy
Executive Director
Texas Commission for the Blind
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 459-2611

CHAPTER 169.Blind and Visually Impaired Children's Program 
The Texas Commission for the Blind proposes the repeal of sec.sec.169.1-169.5, 
169.10-169.16, 169.25-169.34, 169.40, 169.50-169.52, and 169.60-169.63, 
concerning services for blind and visually impaired children. The purpose of the 
repeals is to allow the agency to simultaneously propose new rules for 
administering the Blind and Visually Impaired Children's Program. 
Ernest Pereyra, Deputy Director of Administration and Finance, has determined 
that for the first five years the rules are in effect there will be no fiscal 
implications for state or local government as a result of enforcing or 
administering the repeals. 
Mr. Pereyra has also determined that for each year of the first five years the 
repeals are in effect the public benefits anticipated as a result of the repeals 
will be in the new rules that are simultaneously being proposed with these 
repeals. There will be no effect on small businesses as a result of the repeals. 
There is no anticipated economic cost to individuals who are required to comply 
with the repeals. 
Questions about the content of this proposal may be directed to Jean Crecelius 
at (512) 459-2611, and written comments on the proposal may be submitted to 
Policy and Rules Coordinator, P. O. Box 12866, Austin, Texas 78711, within 30 
days from the date of this publication. 

SUBCHAPTER A.General Information
40 TAC sec.sec.169.1-169.5
(Editor's note: The text of the following sections proposed for repeal will not 
be published. The sections may be examined in the offices of the Texas 
Commission for the Blind or in the Texas Register office, Room 245, James Earl 
Rudder Building, 1019 Brazos Street, Austin.)
The repeals are proposed under the Human Resources Code, Title 5, Chapter 91, 
which authorizes the commission to adopt rules prescribing the policies and 
procedures followed by the commission in the administration of its programs. 
The repeals affect Human Resources Code, Title 5, Chapter 91, sec.91.028, 
Services for Visually Handicapped Children. 
sec.169.1.Purpose and Legal Authority.
sec.169.2.Public Access to Information, Forms and Documents.
sec.169.3.Remedy of Dissatisfaction.
sec.169.4.Definitions.
sec.169.5.Comparable Services and Benefits. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 27, 1998.
TRD-9808561
Terrell I. Murphy
Executive Director
Texas Commission for the Blind
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 459-2611

SUBCHAPTER B.Basic Program Requirements
40 TAC sec.sec.169.10-169.16. 
(Editor's note: The text of the following sections proposed for repeal will not 
be published. The sections may be examined in the offices of the Texas 
Commission for the Blind or in the Texas Register office, Room 245, James Earl 
Rudder Building, 1019 Brazos Street, Austin.)
The repeals are proposed under the Human Resources Code, Title 5, Chapter 91, 
which authorizes the commission to adopt rules prescribing the policies and 
procedures followed by the commission in the administration of its programs. 
The repeals affect Human Resources Code, Title 5, Chapter 91, sec.91.028, 
Services for Visually Handicapped Children. 
sec.169.10.Referral and Application.
sec.169.11.Eligibility.
sec.169.12.Prior Authorization of Services.
sec.169.13.Plan of Services.
sec.169.14.Case Closures.
sec.169.15.Reopening Closed Cases.
sec.169.16.Reports of Suspected Neglect or Abuse. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 27, 1998.
TRD-9808562
Terrell I. Murphy
Executive Director
Texas Commission for the Blind
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 459-2611

SUBCHAPTER C.Scope of Services
40 TAC sec.sec.169.25-169.34 
(Editor's note: The text of the following sections proposed for repeal will not 
be published. The sections may be examined in the offices of the Texas 
Commission for the Blind or in the Texas Register office, Room 245, James Earl 
Rudder Building, 1019 Brazos Street, Austin.)
The repeals are proposed under the Human Resources Code, Title 5, Chapter 91, 
which authorizes the commission to adopt rules prescribing the policies and 
procedures followed by the commission in the administration of its programs. 
The repeals affect Human Resources Code, Title 5, Chapter 91, sec.91.028, 
Services for Visually Handicapped Children. 
sec.169.25.Initial Diagnostic Study to Determine Eligibility.
sec.169.26.Eye Specialty Examinations.
sec.169.27.Physical Examinations and Other Medical Specialty Examinations.
sec.169.28.Other Diagnostics/Evaluations.
sec.169.29.Eye Treatment Services.
sec.169.30.Transportation Services.
sec.169.31.Maintenance.
sec.169.32.Skills Development Services and Purchase of Equipment.
sec.169.33.Counseling, Guidance, and Follow-Up Services. 
sec.169.34.Educational Support Services.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 27, 1998.
TRD-9808563
Terrell I. Murphy
Executive Director
Texas Commission for the Blind
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 459-2611

SUBCHAPTER D.Economic Need
40 TAC sec.169.40 
(Editor's note: The text of the following section proposed for repeal will not 
be published. The section may be examined in the offices of the Texas Commission 
for the Blind or in the Texas Register office, Room 245, James Earl Rudder 
Building, 1019 Brazos Street, Austin.)
The repeal is proposed under the Human Resources Code, Title 5, Chapter 91, 
which authorizes the commission to adopt rules prescribing the policies and 
procedures followed by the commission in the administration of its programs. 
The repeal affects Human Resources Code, Title 5, Chapter 91, sec.91.028, 
Services for Visually Handicapped Children. 
sec.169.40.Determination.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 27, 1998.
TRD-9808564
Terrell I. Murphy
Executive Director
Texas Commission for the Blind
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 459-2611

SUBCHAPTER E.Order of Selection for Payment of Services
40 TAC sec.sec.169.50-169.52 
(Editor's note: The text of the following sections proposed for repeal will not 
be published. The sections may be examined in the offices of the Texas 
Commission for the Blind or in the Texas Register office, Room 245, James Earl 
Rudder Building, 1019 Brazos Street, Austin.)
The repeals are proposed under the Human Resources Code, Title 5, Chapter 91, 
which authorizes the commission to adopt rules prescribing the policies and 
procedures followed by the commission in the administration of its programs. 
The repeals affect Human Resources Code, Title 5, Chapter 91, sec.91.028, 
Services for Visually Handicapped Children. 
sec.169.50.Defined Purpose.
sec.169.51.Application of Order of Selection.
sec.169.52.Order of Selection Expenditure Categories. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 27, 1998.
TRD-9808565
Terrell I. Murphy
Executive Director
Texas Commission for the Blind
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 459-2611

SUBCHAPTER F.Case Management Reimbursement Charges
40 TAC sec.sec.169.60-169.63 
(Editor's note: The text of the following sections proposed for repeal will not 
be published. The sections may be examined in the offices of the Texas 
Commission for the Blind or in the Texas Register office, Room 245, James Earl 
Rudder Building, 1019 Brazos Street, Austin.)
The repeals are proposed under the Human Resources Code, Title 5, Chapter 91, 
which authorizes the commission to adopt rules prescribing the policies and 
procedures followed by the commission in the administration of its programs. 
The repeals affect Human Resources Code, Title 5, Chapter 91, sec.91.028, 
Services for Visually Handicapped Children. 
sec.169.60.Legal Basis and Policy.
sec.169.61.Scope of Subchapter.
sec.169.62.Definitions.
sec.169.63.Billing for Case Management Services.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 27, 1998.
TRD-9808566
Terrell I. Murphy
Executive Director
Texas Commission for the Blind
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 459-2611

CHAPTER 169.Blind and Visually Impaired Children's Program
The Texas Commission for the Blind proposes new sec.sec.169.1-169.5; 
sec.sec.169.10-169.16; sec.sec.169.25-169.35; sec.169.40; sec.sec.169.50-169.52; 
and sec.sec.169.60-169.63, concerning the Blind and Visually Impaired Children's 
Program. 
The rules establish the program and describe the policies followed by the 
Commission in providing services to children with visual impairments. The rules 
are the result of the agency's complete review of the program and existing rules 
over the past year. As a result of the review, the agency has revised its rules 
and is simultaneously proposing the repeal of its existing rules. The new rules 
in this proposal contain many technical changes and several new or changed 
policies, which follow: (1) To derive the maximum benefits from other available 
resources, the Commission has set a 90-day timeframe in which parents are 
required to provide the agency with evidence that they have applied for benefits 
provided from other sources. This new rule, found in sec.169.5, allows 
extenuating circumstances to be considered. (2) To allow time for appeals, a new 
provision in sec.169.14 gives parents 30 days' advance written notice before the 
Commission will close a child's case. (3) The agency is expanding its current 
policy of paying for physical exams for children only when health problems are 
suspected to include physicals when a child needs to attend a beneficial camp, 
and the physical is required for the child to participate. This change is 
reflected in sec.169.26, which no longer contains the current limitation. (4) 
Reasonable limitations are proposed in sec.169.33 and sec.169.34 for providing 
respite care and child care to families. Respite care is restricted to parents 
of severely visually impaired children who have multiple disabilities, and a 
limit of $1,000 per child per state fiscal year is proposed. With regard to 
child care, services are restricted to times in which parents of children who 
have permanent severe visual losses are participating in other services that 
will result in a substantial contribution to the child's ability to benefit from 
habilitation services. (5) With regard to paying for certain services while a 
child is in school, the Commission is proposing a policy in sec.169.35 
consistent with the Individuals With Disabilities Education Act (IDEA). (6) In 
Subchapter D, pertaining to determination of economic resources, the agency is 
giving parents the right not to disclose their financial resources. To reduce 
parental and agency paperwork, the agency is changing from determining economic 
resources on a net monthly basis to a gross monthly basis. For parents with 
gross monthly incomes above the applied federal poverty level who may need some 
flexibility from a hard-and-fast rule that they must participate, the agency has 
allowed extenuating circumstances to intervene, such as extensive unpaid medical 
bills. (7) The rules the agency will use to apply an order of selection during 
times of funding emergencies (sec.sec.169.50-169.52) have been changed from six 
categories of priority to five and the placement of children with differing eye 
conditions within categories has changed slightly. 
Ernest Pereyra, Deputy Director of Administration and Finance, has determined 
that for the first five years the rules are in effect there will be no fiscal 
implications for state or local government as a result of enforcing or 
administering the rules. 
Mr. Pereyra has also determined that for each year of the first five years the 
rules are in effect the anticipated public benefits will be program rules that 
can be administered efficiently on a statewide basis for the benefit of children 
with visual impairments. There will be no effect on small businesses as a result 
of the new sections. The economic cost to individuals who are required to comply 
with the rules will depend on the cost of the service to the agency and the 
economic resources available to the consumer to participate in the cost. Most 
children served by this program fall below the level at which participation in 
the cost of services is required or within the economic guidelines for reduced 
case management fees or no fees. 
Questions about the content of this proposal may be directed to Jean Crecelius 
at (512) 459-2611, and written comments on the proposal may be submitted to 
Policy and Rules Coordinator, P. O. Box 12866, Austin, Texas 78711, within 30 
days from the date of this publication. 

SUBCHAPTER A.General Information
40 TAC sec.sec.169.1-169.5
The rules are proposed under the Human Resources Code, Title 5, Chapter 91, 
which authorizes the commission to adopt rules prescribing the policies and 
procedures followed by the commission in the administration of its programs. 
The rules affect Human Resources Code, Title 5, Chapter 91, sec.91.028, Services 
for Visually Handicapped Children. 

sec.169.1.Purpose and Legal Authority.
The Blind and Visually Impaired Children's Program is established to implement 
Human Resources Code, Chapter 91, sec.91.028 (relating to Services for Visually 
Handicapped Children). The Commission is authorized to provide children who are 
blind and children who have visual impairments with services to supplement the 
services provided by other state agencies when the Commission determines that 
the provision of the services is appropriate and that the services will assist 
the children in achieving financial self-sufficiency and a fuller and richer 
life. 

sec.169.2.Public Access to Information, Forms and Documents.
Copies of agency forms and documents used in the administration of the Blind and 
Visually Impaired Children's Program are available for public viewing at any 
agency office, including the central office, 4800 North Lamar, Austin, Texas, 
between 8:00 a.m. and 5:00 p.m. on work days. An interested person may call 
toll-free (800) 252-5204 work days to request a copy or to seek information 
about the program. 

sec.169.3.Remedy of Dissatisfaction.
The agency's appeal process in sec.159.21 of this title (relating to Appeals, 
Process, Reviews and Hearings) shall be available to parents who wish to contest 
a determination made concerning eligibility for services, the denial and 
furnishing of services, and the termination of services. 

sec.169.4.Definitions.
The following words and terms, when used in this chapter, shall have the 
following meanings unless the context clearly indicates otherwise. The use of 
the singular or plural case is not meant to be limiting unless the context 
clearly indicates otherwise. 
(1) Blind -- Best corrected visual acuity of 20/200 or less in the better eye, 
or a visual loss that results in a limitation in the field of vision such that 
the widest diameter of the visual field subtends an angle no greater than 20 
degrees, which means a field of no greater than 20 degrees in the better eye.
(2) BVIC Program -- Blind and Visually Impaired Children's Program. 
(3) Caseworker -- An employee of the Commission designated to provide BVIC 
Program services. 
(4) Commission -- The Texas Commission for the Blind.
(5) Comparable services and benefits -- Any service, benefit, or resource 
available to a child from another public or private source that provides in 
whole or in part the services that the child would otherwise receive from the 
Commission. 
(6) Developmental services -- Services that increase the capabilities and 
functional abilities of a child in a noneducational setting.
(7) Educational support services-- Services that assist a child in gaining the 
maximum benefit from educational services provided by others. 
(8) Federal poverty level -- The amount of income, depending on family size, 
that the United States Department of Health and Human Services determines to be 
the level of income below which a family is classified as being in poverty. 
(9) Habilitation services -- Services that develop a severely visually impaired 
child's skills for independent living and potential employment.
(10) Nonsevere visual loss -- A visual acuity such that one eye meets the 
definition of blind or severe visual loss and the acuity in the other eye with 
best correction is better than 20/70, or a visual acuity in both eyes with best 
correction of better than 20/70. 
(11) Parent -- The child's natural or adoptive parent; or the spouse of the 
child's natural or adoptive parent; or the child's guardian, surrogate parent; 
or the spouse of the guardian or surrogate parent; or a person or spouse of the 
person who is acting as the child's parent. 
(12) Referral -- A child who has been referred to the BVIC Program for services 
but for whom an application has not been completed.
(13) Respite care services -- Services provided to the parent of a child as a 
period of temporary relief from their responsibilities as primary caregiver. 
(14) Restoration services -- Services to eliminate or reduce limitations imposed 
by a visual impairment on the functioning of a child and cosmetic services 
necessary to improve the physical appearance of the child's eyes when the eyes 
are abnormal to the extent that they negatively impact the child's social and 
emotional well-being. 
(15) Severe visual loss -- A loss of vision such that the best corrected visual 
acuity is between 20/70 and 20/200 in the better eye; or a visual loss such that 
the visual field is 30 degrees or less but greater than 20 degrees with best 
correction. 
(16) Severely visually impaired child -- A child with a visual impairment that 
has resulted in a permanent condition of blindness or severe visual loss; or a 
child who has been certified as blind or severely visually impaired by a local 
education agency; or a child who has been determined to be functioning as a 
person who is blind or who has a severe visual loss.
(17) Technology services -- Services to provide a child access to an item, piece 
of equipment, or product system that maintains or improves the child's 
communication, independent living, social, or prevocational skills. 
(18) Visual impairment -- An injury, disease, or other disorder that reduces, or 
if not treated will probably result in reducing, visual functioning; or a visual 
condition requiring cosmetic treatment, psychological assistance, counseling, or 
other assistance that the commission can render.

sec.169.5.Comparable Services and Benefits.
(a) The Commission shall consider comparable services and benefits prior to 
expending Commission funds for all BVIC Program services.
(b) The child's parent shall be required to apply for assistance from any 
resource identified by the Commission that may be a resource for comparable 
services and benefits. 
(c) The child's parent must provide acceptable evidence of eligibility or 
ineligibility for such comparable services and benefits to the Commission within 
90 days from application or additional expenditures may be suspended. 
(d) Whenever possible and practical, the child's parent's choice of health 
professionals and appropriate facilities is honored, as long as such 
professionals and facilities are willing to accept reimbursement in accordance 
with the Commission's maximum affordable payment schedule (MAPS).
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 27, 1998.
TRD-9808567
Terrell I. Murphy
Executive Director
Texas Commission for the Blind
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 459-2611

SUBCHAPTER B.Basic Program Requirements
40 TAC sec.sec.169.10-169.16 
The rules are proposed under the Human Resources Code, Title 5, Chapter 91, 
which authorizes the commission to adopt rules prescribing the policies and 
procedures followed by the commission in the administration of its programs. 
The rules affect Human Resources Code, Title 5, Chapter 91, sec.91.028, Services 
for Visually Handicapped Children. 

sec.169.10.Referral and Application.
(a) A child may be referred to the BVIC Program by letter, telephone, direct 
contact, or by another means by providing a name and address to any Commission 
office. 
(b) A child may be referred by the Commission to another Commission program if 
necessary to better meet the child's needs. 
(c) A child is considered an applicant for BVIC Program services on the day the 
Commission receives a properly completed application form signed by the child's 
parent.

sec.169.11.Eligibility.
(a) To be eligible to receive services under this chapter, an applicant must: 
(1) have a visual impairment; 
(2) reside in Texas; and 
(3) be 18 years of age or younger. 
(b) A person over the age of 18 and under the age of 22 who meets the criteria 
in subsection (a)(1) and (2) of this section and who is enrolled in a secondary 
school may receive services under this chapter if the Commission determines that 
children's services are appropriate for the individual. The term "child" as used 
in this chapter shall encompass persons included in this subsection. 
(c) Eligibility requirements shall be applied without regard to the age, gender, 
race, color, creed, or national origin of the applicant.
(d) Expenditure of funds and provision of services may be restricted by other 
criteria in these rules. 

sec.169.12.Prior Authorization of Services.
The Commission shall not pay for any service not authorized in advance by the 
caseworker. 

sec.169.13.Family Service Plan.
(a) The Commission shall develop a family service plan jointly with the child's 
parent when it has been determined that the child needs habilitation services.
(b) The family service plan shall contain a description of the child's planned 
services, agreements between the parent and the Commission, and other 
information necessary to administer the provisions of this chapter.

sec.169.14.Case Closures.
(a) The Commission shall close a child's case when the child's plan of services 
has been completed, or sooner if: 
(1) the child has moved out of the state; 
(2) the child cannot be located; 
(3) the child has died; or 
(4) the parent refuses to cooperate with the Commission.
(b) The Commission shall inform the child's parent of the Commission's intent to 
close the child's case no fewer than 30 days in advance by sending a letter to 
the parent's last known address. No notice shall be sent if the case is being 
closed due to the death of the child.

sec.169.15.Reopening Closed Cases.
Cases shall not be reopened for the sole purpose of providing routine eye exams, 
glasses, contact lenses, or treatment such as drops for glaucoma and 
conjunctivitis, unless the caseworker suspects that a child's vision is 
threatened due to abuse or medical neglect.

sec.169.16.Reports of Suspected Neglect or Abuse.
In compliance with state laws governing such reports, the Commission shall 
report instances in which the agency suspects a child's physical or mental 
health or welfare has been or may be adversely affected by abuse or neglect. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 27, 1998.
TRD-9808568
Terrell I. Murphy
Executive Director
Texas Commission for the Blind
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 459-2611

SUBCHAPTER C.Services
40 TAC sec.sec.169.25-169.35
The rules are proposed under the Human Resources Code, Title 5, Chapter 91, 
which authorizes the commission to adopt rules prescribing the policies and 
procedures followed by the commission in the administration of its programs. 
The rules affect Human Resources Code, Title 5, Chapter 91, sec.91.028, Services 
for Visually Handicapped Children. 

sec.169.25.Assessment Services.
(a) The Commission may provide medical and diagnostic assessments jointly agreed 
to by the caseworker and parent that are necessary to determine the eligibility 
of a child and to initiate a service plan upon a finding of eligibility. 
(b) Services in this section, with the exception of purchasing copies of 
existing records, are subject to application of Subchapter D of this chapter 
(relating to Economic Resources) and Subchapter E of this chapter (relating to 
Order of Selection for Payment of Services). 

sec.169.26.Physical Examinations and Other Medical Specialty Examinations.
(a) The Commission may provide physical examinations and other necessary medical 
specialty examinations jointly agreed to by the caseworker and parent when the 
caseworker determines that the examination is necessary for the child to 
participate in planned services. 
(b) Services in this section are subject to application of Subchapter D of this 
chapter (relating to Economic Resources), with the exception of purchasing 
copies of existing records; Subchapter E of this chapter (relating to Order of 
Selection for Payment of Services); and Subchapter F of this chapter (relating 
to Case Management Reimbursement Charges). 

sec.169.27.Other Diagnostic Evaluations.
(a) Diagnostic evaluations of a nonmedical nature that are necessary to plan 
developmental services may be provided by the Commission only for children 
receiving habilitation services and jointly agreed to by the caseworker and 
parent. 
(b) Services included in this section are subject to application of Subchapter D 
of this chapter (relating to Economic Resources), with the exception of 
purchasing copies of existing records; Subchapter E of this chapter (relating to 
Order of Selection for Payment of Services); and Subchapter F of this chapter 
(relating to Case Management Reimbursement Charges).

sec.169.28.Restoration Services.
(a) Restoration services do not include routine eye exams, treatments such as 
drops for glaucoma and conjunctivitis, or glasses or contact lenses for children 
whose only eye problem is a refractive error in which the uncorrected visual 
acuity is 20/70 or better in both eyes. 
(b) Restoration services must be recommended in writing by an ophthalmologist, 
optometrist, ocularist, or orthoptist and jointly agreed to by the caseworker 
and parent. 
(c) Only one pair of replacement glasses or contact lenses may be purchased in a 
12-month period for a child receiving restoration services unless there is a .5 
or greater diopter change in either prescribed lens.
(d) Restoration services are subject to application of Subchapter D of this 
chapter (relating to Economic Resources), Subchapter E of this chapter (relating 
to Order of Selection for Payment of Services), and Subchapter F of this chapter 
(relating to Case Management Reimbursement Charges). 

sec.169.29.Travel Services.
(a) Travel services, including lodging, food, and transportation for a child and 
parent, may be provided when travel is necessary to participate in other 
services covered under this subchapter except vision screening services.
(b) Travel services available to the child and parent without cost to the 
Commission shall be used first. 
(c) Travel services shall be reimbursed at a rate no more than the rate 
authorized for state employees traveling on official business. In the event 
commercial transportation is used for the purposes allowed under this chapter, 
services shall be limited to the expenses of the child and one travel companion. 
(d) To receive reimbursement for travel expenses, a parent is required to submit 
receipts and information requested by the caseworker.
(e) Travel services are subject to application of Subchapter D of this chapter 
(relating to Economic Resources), Subchapter E of this chapter (relating to 
Order of Selection for Payment of Services), and Subchapter F of this chapter 
(relating to Case Management Reimbursement Charges). 

sec.169.30.Habilitation Services.
(a) The following habilitation services may be provided by the Commission only 
for children who meet the definition of severely visually impaired child or 
their families: 
(1) developmental services; 
(2) psychological counseling for the child and the child's family members who 
reside in the same household with the child; 
(3) technology services; 
(4) educational support services; 
(5) independent living skills services provided through agency staff to the 
child and to other individuals who are involved in the child's development of 
independent living skills; and 
(6) braille instruction for family members of children receiving habilitation 
services. 
(b) The provisions of Subchapter D of this chapter (relating to Economic 
Resources), Subchapter E of this chapter (relating to Order of Selection for 
Payment of Services), and Subchapter F of this chapter (relating to Case 
Management Reimbursement Charges) are applied to developmental services, 
psychological counseling services, and technology services. 
(c) The provisions of Subchapter F of this chapter (relating to Case Management 
Reimbursement Charges) are applied to independent living skills services and 
braille instruction. 

sec.169.31.Counseling, Guidance, and Follow-up Services.
(a) Counseling, guidance, and follow-up services by caseworkers are available to 
all eligible children. 
(b) Services covered under this section are subject to Subchapter F of this 
chapter (relating to Case Management Reimbursement Charges). 

sec.169.32.Vision Screening Services.
(a) Vision screening services consisting of an eye examination and, if 
appropriate, glasses, may be provided for children whose only eye problem is an 
uncorrected visual acuity of 20/70 or worse in both eyes and who need no 
services other than correction of a refractive error. 
(b) Services under this section are subject to Subchapter D of this chapter 
(relating to Economic Resources) and Subchapter E of this chapter (relating to 
Order of Selection for Payment of Services). 

sec.169.33.Respite Care Services.
(a) Respite care services may be provided only to parents of severely visually 
impaired children who have one or more secondary disabilities and are receiving 
habilitation services. 
(b) Respite care services may not exceed a total of $1,000 per child per state 
fiscal year. 
(c) It is the parent's responsibility to: 
(1) specify the level of respite care necessary to meet the needs of the child; 
(2) select an appropriate provider and make arrangements for the provision of 
care; 
(3) pay the respite provider; and 
(4) in order to receive reimbursement, provide the Commission with a signed 
receipt in a format acceptable to the Commission when respite care services are 
completed. 
(d) Services in this section are subject to Subchapter D of this chapter 
(relating to Economic Resources), Subchapter E of this chapter (relating to 
Order of Selection for Payment of Services), and Subchapter F of this chapter 
(relating to Case Management Reimbursement Charges). 

sec.169.34.Child Care Services.
(a) Child care services may be provided only to parents of children receiving 
habilitation services. 
(b) Child care services may be provided only to allow family members to 
participate in services that will result in a substantial contribution to the 
child's ability to benefit from habilitation services. 
(c) It is the parent's responsibility to: 
(1) specify the level of child care necessary; 
(2) select an appropriate provider and make arrangements for the provision of 
care; 
(3) pay the child care provider; and 
(4) in order to receive reimbursement provide the Commission with a signed 
receipt in a format acceptable to the Commission when child care services are 
completed. 
(d) Services in this section are subject to Subchapter D of this chapter 
(relating to Economic Resources), Subchapter E of this chapter (relating to 
Order of Selection for Payment of Services), and Subchapter F of this chapter 
(relating to Case Management Reimbursement Charges).

sec.169.35.Services Provided by Schools.
The Commission shall not pay for any service that is the school's responsibility 
under the Individuals With Disabilities Education Act (IDEA) and any federal and 
state rules and regulations adopted pursuant thereto.
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 27, 1998.
TRD-9808569
Terrell I. Murphy
Executive Director
Texas Commission for the Blind
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 459-2611

SUBCHAPTER D.Economic Resources
40 TAC sec.169.40
The rule is proposed under the Human Resources Code, Title 5, Chapter 91, which 
authorizes the commission to adopt rules prescribing the policies and procedures 
followed by the commission in the administration of its programs. 
The rule affects Human Resources Code, Title 5, Chapter 91, sec.91.028, Services 
for Visually Handicapped Children. 

sec.169.40.Determination.
(a) The parent's economic resources shall be determined before the Commission 
authorizes the purchase of certain services contained in Subchapter C of this 
chapter (relating to Services). 
(b) A child under Department of Protective and Regulatory Services (PRS) managed 
conservatorship is considered to be a one-member family with no income. 
(c) Parents have the right to not disclose their economic resources. When this 
information is not disclosed, economic resources shall be determined by the 
Commission to be in excess of the allowable amounts.
(d) To determine the parent's participation in the cost of services that require 
an expenditure of BVIC Program funds, the Commission shall consider the parent's 
gross monthly income, the number of family members for which the parent has 
financial responsibility, and the type of services the child is receiving. These 
factors shall be applied to percentages of the federal poverty level. The 
federal poverty level fluctuates and is periodically reviewed by the Commission. 
Updates to agency operating procedures are made in keeping with the federal 
poverty guidelines and the agency's operating budget. Information about the 
existing federal poverty level, categories of services, and percentage levels in 
use by the Commission is available by calling any Commission office and 
requesting the information. 
(e) Parents with gross monthly incomes at or below the percentage of federal 
poverty level in use by the Commission shall not be required to participate in 
the cost of services that require an expenditure of BVIC Program funds. Parents 
with gross monthly incomes above the applied federal poverty level shall be 
required to participate. In making this decision, the Commission shall consider 
extenuating circumstances which may prohibit the parent's ability to 
participate, such as medical costs and debts resulting from a permanent 
disability or chronic illness of the child or family member. 
(f) Gross monthly income is any funds available to the child and the child's 
parent, which includes, but is not limited to, the following:
(1) wages or salary; 
(2) contributions from relatives, individuals, or organizations received on a 
regular basis; 
(3) child support payments; 
(4) net rentals from property; 
(5) scholarships and fellowships; 
(6) public assistance payments, including Social Security Income (SSI) and 
Temporary Assistance for Needy Families (TANF); 
(7) assistance from private welfare agencies; 
(8) income from stock dividends and bond interest; 
(9) any available pension, annuity, compensation, or insurance, including SSDI, 
health/hospitalization insurance plans, Worker's Compensation, veteran's 
benefits, Old Age and Survivors Insurance (OASI) from the Social Security 
Administration, labor union insurance and/or health and welfare benefits, and 
unemployment compensation; 
(10) participation in savings plans and deductions for savings bonds; 
(11) income from self-employment, which is defined as gross receipts, minus 
allowable Internal Revenue Service expenses, from one's own business that 
results in income. Gross receipts include the value of all goods sold and 
services rendered. Expenses include cost of goods sold, rent, utilities, wages 
and salaries paid; and business taxes (not personal income taxes or self-
employment social security taxes); and 
(12) any other amounts generally recognized as income.
(g) Gross monthly income at application for services shall be based on the 
family's current month's income or the average gross income for the previous 
three months, whichever is less, and shall be updated periodically as deemed 
necessary by the Commission. 
(h) If the provisions of subsection (g) of this section do not accurately 
reflect the family's economic status, the average of the preceding 12 months may 
be used. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt. 
Filed with the Office of the Secretary of State, on May 27, 1998.
TRD-9808570
Terrell I. Murphy
Executive Director
Texas Commission for the Blind
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 459-2611

SUBCHAPTER E.Order of Selection for Payment of Services
40 TAC sec.sec.169.50-169.52
The rules are proposed under the Human Resources Code, Title 5, Chapter 91, 
which authorizes the commission to adopt rules prescribing the policies and 
procedures followed by the commission in the administration of its programs. 
The rules affect Human Resources Code, Title 5, Chapter 91, sec.91.028, Services 
for Visually Handicapped Children. 

sec.169.50.Defined Purpose.
(a) The purpose of this subchapter is to establish an order of selection for 
payment of services that may be used when funds are insufficient to serve all 
eligible children. 
(b) The public may contact the Commission at any local office or may call the 
agency's toll-free line (1-800-252-5204) to inquire if the agency is operating 
under provisions of this subchapter and to inquire about the expenditure 
category at which the Commission may be operating. 

sec.169.51.Application of Order of Selection.
(a) The order of selection is applied after eligibility for services is 
determined. 
(b) A service that can be paid from resources other than the Commission's may be 
provided to a child regardless of the order of selection.

sec.169.52.Order of Selection Expenditure Categories.
Order of Selection expenditure categories, from most restrictive to least 
restrictive, are: 
(1) Category A -- No expenditure of case service funds. 
(2) Category B -- Expenditure of case service funds only for diagnostics. 
(3) Category C -- Expenditure of case service funds authorized for any planned, 
necessary BVIC Program services according to the following priorities: 
(A) Priority 1 -- Children who meet the definition of being blind. 
(B) Priority 2 -- Children who are blind in one eye and who have a severe visual 
loss in the other eye. 
(C) Priority 3 -- Children who fall in one or more of the following categories: 
(i) Children who have an uncorrected visual acuity of 20/70 or worse in the 
better eye; 
(ii) Children who have a nonsevere visual loss and a degenerative eye condition 
that will result in further visual loss; 
(iii) Children who need a prosthesis; and 
(iv) Children who are certified as visually impaired by a local education 
agency. 
(D) Priority 4 -- Children with nonsevere visual losses that affect visual 
acuity who are in need of services other than correction of a refractive error. 
(E) Priority 5 -- Children with treatable visual impairments that may or may not 
affect visual acuity and children with an uncorrected visual acuity of 20/70 or 
worse in both eyes who need no services other than correction of a refractive 
error. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 27, 1998.
TRD-9808571
Terrell I. Murphy
Executive Director
Texas Commission for the Blind
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 459-2611

SUBCHAPTER F.Case Management Reimbursement Charges
40 TAC sec.sec.169.60-169.63
The rules are proposed under the Human Resources Code, Title 5, Chapter 91, 
which authorizes the commission to adopt rules prescribing the policies and 
procedures followed by the commission in the administration of its programs. 
The rules affect Human Resources Code, Title 5, Chapter 91, sec.91.028, Services 
for Visually Handicapped Children. 

sec.169.60.Legal Basis and Policy. 
Public Law 100-203, sec.4118(i), the Omnibus Budget Reconciliation Act of 1987, 
has been invoked by the Texas Department of Health, which limits the provider of 
case management for children who are blind and visually impaired in Texas to the 
Texas Commission for the Blind; therefore, it is the policy of the Commission to 
seek reimbursement for case management services provided to eligible children 
under this chapter. 

sec.169.61.Scope of Subchapter. 
Case management contacts on behalf of all eligible children under 16 are subject 
to this subchapter, regardless of the family's ability to pay.

sec.169.62.Definitions.
The following words and terms, when used in this subchapter, shall have the 
following meanings, unless the context clearly indicates otherwise. 
(1) Allowable costs -- Expenses relating to case management services that are 
reasonable and necessary in the normal conduct of operations. Also refer to 
definitions of "reasonable cost" and "necessary cost" in this section.
(2) Case management -- Assisting eligible children under this chapter in gaining 
access to medical, social, educational, vocational, and other appropriate 
services to help these individuals reach or maintain an optimal level of 
functioning in a community-based setting.
(3) Case management monthly rate -- A prospective rate based on the average 
monthly cost of providing case management services for an eligible child under 
this chapter. 
(4) Contact -- An action taken by a caseworker on behalf of an eligible child 
under this chapter to locate, coordinate, and monitor necessary and appropriate 
services with a specific person or organizations. Contacts may be face-to-face 
or by telephone. 
(5) Necessary cost -- A cost that is usual and customary in the operation of 
case management services and that meets the following requirements: 
(A) the cost is not for personal or other activity not specifically related to 
the provision of case management services; 
(B) the cost is not allowable under other federal, state, or local laws or 
regulations; 
(C) the cost bears a significant relationship to case management services. The 
test of significance is whether there would be an adverse impact on the delivery 
of case management services if the expenditure were eliminated.
(6) Prospective rate -- A fixed rate of payment determined for a future period 
of time and not readjusted during that period. 
(7) Reasonable cost -- An amount not exceeding the cost that would be incurred 
by a prudent business operator seeking to contain costs. 

sec.169.63.Billing for Case Management Services.
(a) The Commission bills for case management contacts at a case management 
monthly rate equal to the rate set annually for case management reimbursements 
to the Commission for Medicaid recipients. 
(b) A family who does not have Medicaid and whose income exceeds 250% of the 
federal poverty level is billed on a sliding scale, based on the family's gross 
income and the number of persons residing in the household for whom the parent 
or legal guardians have legal and/or financial responsibility. Written 
information about the different levels at which families are billed is available 
according to sec.169.2 of this chapter (relating to Public Access to 
Information, Forms and Documents).
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt. 
Filed with the Office of the Secretary of State, on May 27, 1998.
TRD-9808572
Terrell I. Murphy
Executive Director
Texas Commission for the Blind
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 459-2611

PART XX. Texas Workforce Commission
CHAPTER 809.Child Care and Development
SUBCHAPTER A.General Provisions
40 TAC sec.809.5
The Texas Workforce Commission (Commission) proposes new sec.809.5, concerning 
the State Advisory Committee on Child Care Programs. Proposed sec.809.5 
establishes a 20 member advisory committee that shall advise the Commission in 
developing coordinated state policies for the use of federal and state funds in 
child care programs. The advisory committee shall review child care policies and 
programs for compliance with applicable guidelines and shall advise the 
Commission of the results of the review.
Ms. Charlotte Brantley, Director of Child Care/Work and Family Clearinghouse, 
has determined that for each of the first five years the rule is in effect, the 
public benefit anticipated as a result of enforcing the rule will be a more 
positive and effective implementation of the provisions of the Texas Human 
Resources Code, Chapter 44, Subchapter C. Ms. Brantley and Randy Townsend, 
Director of Finance, have determined there is no anticipated adverse impact on 
small business as a result of enforcing or administering the proposed rule, as 
small businesses are not required to do anything by the rule that is in addition 
to what is already required by the Texas Human Resources Code, Chapter 44, 
Subchapter C. 
Randy Townsend, Director of Finance, has determined that for the first five-year 
period the rule is in effect, there will be no fiscal implications for state or 
local government as a result of enforcing or administering the proposed rule. 
Mr. Townsend has certified that there will be no foreseeable impact on local 
economies or overall employment as a result of enforcing or administering the 
proposed rule. The adoption of the rule will result in no foreseeable economic 
costs to persons who are required to comply with the rule, and no foreseeable 
costs associated with implementing this section. All official comments submitted 
to Charlotte Brantley will be considered before the final rule is adopted. 
Comments on the proposed rule may be submitted to Charlotte Brantley, Director 
of Child Care/Work and Family Clearinghouse, Texas Workforce Commission, 101 
East 15th Street, Room 416T, Austin, Texas 78778, (512) 936-3227. Comments may 
also be submitted via fax to Ms. Brantley at (512) 936-3223 or e-mailed to: 
cbrantle@twc.state.tx.us. Comments must be received by the Commission within 30 
days from the date this proposal is published in the Texas Register.
The new rule is proposed under Texas Labor Code, sec.301.061, which provides 
that the Commission has the authority to adopt, amend, or repeal such rules as 
it deems necessary for the effective administration of the Act. 
The proposed new rule affects the Texas Labor Code, Title 4, particularly 
Chapters 301 and 302, and the Texas Human Resources Code, Chapter 44. 

sec.809.5.Child Care State Advisory Committee.
(a) The Commission appoints the State Advisory Committee on Child Care Programs. 
(b) The advisory committee shall consist of 20 members, not including ex officio 
members. 
(c) The advisory committee appointees will be a balanced representation of: 
(1) parents, guardians, or custodians of children who use child care programs; 
(2) child care advocacy groups; 
(3) operators and providers of child care programs and services representing 
rural and urban communities; 
(4) for profit and nonprofit providers of child care services representing rural 
and urban communities; 
(5) experts in early childhood development and education;
(6) experts in child health and nutrition; 
(7) other child care professionals; 
(8) the general public; and 
(9) ex officio representatives from each state agency, as determined by the 
Commission, that have an interest or role in state child care programs. 
(d) The Commission shall provide staff support and other support necessary to 
the advisory committee to operate the committee. 
(e) Subject to appropriations, the advisory committee may be reimbursed for 
travel expenses incurred while conducting the business of the board. 
(f) The advisory committee shall advise the Commission in developing coordinated 
state policies for the use of federal and state funds in child care programs. 
(g) The advisory committee shall review child care policies and programs for 
compliance with applicable guidelines and shall advise the Commission on the 
results of the review in accordance with the Texas Human Resources Code, Chapter 
44, Subchapter C, as amended. 
(h) The Commission with the assistance of the advisory committee shall hold 
biennial public hearings on state and federal child care programs to elicit 
public response and recommendations regarding the quality, accessibility, and 
affordability of child care services. The hearings must be held in at least 
three separate geographical regions of the state and may be held in conjunction 
with other public hearings on child care held by the Commission.
(i) The advisory committee shall annually report its findings and 
recommendations to the Commission. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt. 
Filed with the Office of the Secretary of State, on May 28, 1998.
TRD-9808687
J. Randel (Jerry) Hill
General Counsel
Texas Workforce Commission
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 463-8812

SUBCHAPTER E.Client Eligibility Process Requirements
40 TAC sec.809.93
The Texas Workforce Commission (Commission) proposes new sec.809.93, concerning 
the receipt of Texas Workforce Commission Applicant Child Care. 
Proposed sec.809.93 establishes a priority for receiving child care subject to 
the availability of funds for individuals who need child care to accept 
employment, reside in a county where TWC Choices services are available, receive 
a referral from a Department of Human Services (DHS) Texas Works Advisor to 
attend a Workforce Orientation for Applicants, and secure employment prior to 
Temporary Assistance for Needy Families program (TANF) certification.
Ms. Charlotte Brantley, Director of Child Care/Work and Family Clearinghouse, 
has determined that for each of the first five years the rule is in effect, the 
public benefit anticipated as a result of enforcing the rule will be a more 
positive and effective implementation of House Bill 1863, 74th Legislature, 
Regular Session. Specifically, the purpose of the above cited legislation will 
be more meaningfully effected in that more clients will be able to receive help 
in paying for child care in order to maintain meaningful employment as an 
alternative to receiving TANF cash benefits. Ms. Brantley and Randy Townsend, 
Director of Finance have determined there is no anticipated adverse impact on 
small business as a result of enforcing or administering the proposed rule. 
Randy Townsend, Director of Finance, has determined that for the first five-year 
period the rule is in effect, there will be no fiscal implications for state or 
local government as a result of enforcing or administering the proposed rule. 
Mr. Townsend has certified that there will be no foreseeable impact on local 
economies or overall employment as a result of enforcing or administering the 
proposed rule. The adoption of the rule will result in no foreseeable economic 
cost to persons who are required to comply with the rule, and no foreseeable 
cost associated with implementing this section. All official comments submitted 
to Charlotte Brantley will be considered before the final rule is adopted. 
Comments on the proposed rule may be submitted to Charlotte Brantley, Director 
of Child Care/Work and Family Clearinghouse, Texas Workforce Commission, 101 
East 15th Street, Room 416T, Austin, Texas 78778, (512) 936-3227. Comments may 
also be submitted via fax to Ms. Brantley at (512) 936-3223 or e-mailed to: 
cbrantle@twc.state.tx.us. Comments must be received by the Commission within 30 
days from the date this proposal is published in the Texas Register.
The new rule is proposed under Texas Labor Code, sec.301.061, which provides 
that the Commission has the authority to adopt, amend, or repeal such rules as 
it deems necessary for the effective administration of the Act. 
The proposed new rule affects the Texas Labor Code, Title 4, particularly 
Chapters 301 and 302 and the Texas Human Resources Code, Chapter 44. 

sec.809.93.Texas Workforce Commission Applicant Child Care.
(a) Subject to the availability of funds, the Child Care Management Services 
Contractor shall provide Child Care for up to one year for individuals who meet 
the following criteria. The client shall: 
(1) need child care to accept employment; 
(2) reside in a county where Choices services are available;
(3) receive a referral from the Department of Human Services Texas Works Advisor 
to attend a Workforce Orientation for Applicants; 
(4) locate employment prior to TANF certification; and
(5) provide verification of a valid social security number.
(b) To receive Applicant Child Care, individuals shall also meet the 
requirements stated in the following sections: 
(1) Section 809.2 of this title (relating to the definition of Family Members); 
(2) Section 809.61(a) of this title (relating to Basic Requirements to Obtain 
Child Care Services from the Child Care Management Services (CCMS) System); 
(3) Section 809.65 of this title (relating to Eligibility Criteria for 
Commission Funded Child Care Services); 
(4) Section 809.67(a) of this title (relating to Income Limits for Child Care 
Services); and 
(5) Section 809.68 of this title (relating to Income Inclusions for Child Care 
Eligibility Determination). 
(c) To receive Applicant Child Care, individuals shall not have voluntarily 
terminated paid employment of at least thirty hours a week within thirty days 
prior to receiving the referral from the Department of Human Services Texas 
Works Advisor to attend a Workforce Orientation for Applicants. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt. 
Filed with the Office of the Secretary of State, on May 28, 1998.
TRD-9808689
J. Randel (Jerry) Hill
General Counsel
Texas Workforce Commission
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 463-8812

SUBCHAPTER J.School-Linked Child Care Program
40 TAC sec.sec.809.201-809.205
The Texas Workforce Commission (Commission) proposes new sec.sec.809.201- 
809.205, regarding funding to be awarded by the Commission to school districts 
to provide for child care before and after school, as well as during school 
vacations and holidays. 
The statutory requirements for the School-Linked Child Care Program are found in 
Texas Education Code, sec.33.902. The purpose of the program is to encourage 
school districts to provide child care to school-age children before and after 
school, as well as during school vacations and holidays. The number of awards 
provided is limited by the amount of funds available to the Commission for this 
program. The Commission will strive to assure an equitable allocation of funds 
awarded under these rules between urban and rural areas of the state. The 
Commission will take into consideration whether or not a school district has 
been awarded funds under this program in the past, and may give preference to a 
school district which has not previously been awarded such funds. 
Subchapter J is proposed as the location for the School-Linked Child Care 
Program. 
Section 809.201 explains the purpose of this subchapter. 
Section 809.202 provides definitions of the terms used in this subchapter.
Section 809.203 lists some of the information which must be included by a school 
district in a response to a request for proposal issued by the Commission for 
funding through this program. 
Section 809.204 describes the criteria which will be used by the Commission in 
awarding funds. 
Section 809.205 lists the allowable uses of funds awarded. 
Randy Townsend, Director of Finance for the Texas Workforce Commission, has 
determined that, for the first five-year period the rules are in effect, there 
will be no fiscal impact to the state or to local governments. There will be no 
net effect on revenues as a result of enforcing and administering the rules, and 
no forseeable implications relating to costs or revenues to the state or to 
local governments. The adoption of the rules would result in no regulatory 
burden or impact on small businesses, no forseeable economic costs to persons 
who are required to comply with the rules, and no forseeable costs associated 
with implementing these sections. 
Charlotte Brantley, Director of Child Care/Work and Family Clearinghouse, has 
determined that, for each of the first five years the rules are in effect, the 
public benefit anticipated as a result of enforcing the rules will be expanded 
resources for school-age child care in communities receiving a grant. As a 
result of implementation of the program, there may be some increased opportunity 
to small businesses in the child care industry to subcontract with a school 
district to provide child care. The effect of these rules locally cannot be 
determined as the amounts to be allocated between the school districts have not 
been determined, and will not be known until the responses to the request for 
proposal are received, evaluated, and processed by the Commission under the 
procedures set forth in these rules. 
Mark Hughes, Labor Market Information Director, has determined there is no basis 
to anticipate any significant overall impact upon employment levels or 
conditions within the state as a result of these proposed rules. 
All official comments submitted to Charlotte Brantley will be considered before 
the final rules are adopted. Comments on the proposed rules may be submitted to 
Charlotte Brantley, Director of Child Care/Work and Family Clearinghouse, Texas 
Workforce Commission Building, 101 East 15th Street, Room 416T, Austin, Texas 
78778, (512) 936-3227. Comments may also be submitted via fax to Ms. Brantley at 
(512) 936-3223 or e-mailed to: cbrantle@twc.state.tx.us. Comments must be 
received by the Commission within 30 days from the date this proposal is 
published in the Texas Register.
The new rules are proposed under Texas Labor Code, sec.301.061, which provides 
the Texas Workforce Commission with the authority to adopt, amend, or repeal 
such rules as it deems necessary for the effective administration of Texas 
Workforce Commission programs, and under Texas Education Code, sec.33.902. The 
proposed rules affect Texas Labor Code, Chapter 302 and Texas Education Code, 
sec.33.902. 

sec.809.201.Purpose.
The purpose of this subchapter is to set forth the criteria and procedures by 
which school districts may obtain funds from the Commission in order to provide 
child care for school- age children before school, after school, during school 
vacations, and on school holidays.

sec.809.202.Definitions.
The following words and terms, when used in this subchapter, shall have the 
following meanings unless the context clearly indicates otherwise.
(1) School-age children -- Children enrolled in pre-kindergarten through grade 
seven. 
(2) School district -- A public school district accredited under the applicable 
laws of the State of Texas.

sec.809.203.Request for Proposal. 
A response to a request for proposal issued by the Commission shall include the 
following information: 
(1) description of the services to be provided; 
(2) income level of the families to be served; 
(3) amount and source of matching funds or in-kind match for funds received 
under this subchapter; 
(4) prior experience of the school district in providing child care services; 
(5) the school district's plan for coordinating its program with the local 
workforce development board and written acknowledgment from the chair person or 
executive committee of the local workforce development board that the board has 
reviewed and supports the plan; 
(6) the school district's plan for coordinating its program with other child 
care resources, both public and private; and 
(7) description of the need in the community for school-age child care and the 
resources available to meet that need. 

sec.809.204.Criteria for Award. 
In addition to the information required in the response to a request for 
proposal in awarding funds to school districts under this subchapter, the 
Commission may consider the following:
(1) innovative uses of the proposed program; 
(2) prior success of the proposed program; 
(3) prior receipt by a school district of funds under this program; and 
(4) equitable allocation of funds between urban and rural areas of the state. 

sec.809.205.Use of Award.
Funds awarded to school districts under this subchapter may be used by the 
school district for the following purposes: 
(1) planning and developing child care services, including the implementation of 
research-based reading programs; 
(2) establishing a child care program in accordance with this subchapter; 
(3) expanding existing child care services; and 
(4) improving existing child care services. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on May 28, 1998.
TRD-9808688
J. Randel (Jerry) Hill
General Counsel
Texas Workforce Commission
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 463-8812

TITLE 43. TRANSPORTATION
PART I. Texas Department of Transportation
CHAPTER 17.Vehicle Titles and Registration
SUBCHAPTER B.Motor Vehicle Registration
43 TAC sec.17.52
The Texas Department of Transportation proposes new sec.17.52, concerning the 
vehicle emissions enforcement system. 
Senate Bill 1856, 75th Legislature, 1997, added Transportation Code, sec.502.009 
to include provisions for registration denial as required by 40 C.F.R. 
sec.51.361. In accordance with 40 C.F.R. sec.51.361, the Environmental 
Protection Agency (EPA) has determined that the state has not demonstrated that 
inspection sticker-based enforcement is more effective than registration-based 
enforcement in ensuring compliance with the Motor Vehicle Emissions Inspection 
And Maintenance (I/M) Program. Therefore, Senate Bill 1856, requires the 
department to implement a registration-based plan. 
If the EPA determines that the requirements for registration denial are no 
longer necessary and gives the Texas Natural Resources Conservation Commission 
(TNRCC), or a person TNRCC designates, written notification that registration-
based enforcement is not required for the state implementation plan, the 
department will terminate registration-based enforcement of the program. 
Currently, there are four federal nonattainment areas in Texas: Dallas, El Paso, 
Harris, and Tarrant Counties. Vehicles in these counties must pass an emissions 
test, and vehicles coming into those counties from surrounding counties are 
subject to an emissions test. A vehicle that fails the emissions test will not 
be eligible to be registered or re-registered until the vehicle passes the test. 
New sec.17.52 provides an efficient and effective enforcement system for 
compliance with vehicle emissions I/M programs regulated by federal and state 
laws and the provisions of the Texas air quality State Implementation Plan 
(SIP). New sec.17.52 defines general words and terms for the section. It 
provides criteria for the department and the county to deny vehicle registration 
for a vehicle registered in any county that is included in a vehicle emissions 
I/M program when the county or department is notified by the TNRCC or the Texas 
Department of Public Safety (DPS), after notifying the vehicle owner, that the 
registered owner of the vehicle has failed to comply with the vehicle emissions 
I/M program as required by Transportation Code, Chapter 548, Subchapter F, and 
Health and Safety Code, sec.382.037 and sec.382.0372.
Frank J. Smith, Director, Finance Division, has determined that for each year of 
the first five years the section is in effect, there will be fiscal implications 
for state government. There will be a decrease in registration revenue resulting 
from vehicle owners who knowingly circumvent the emissions inspection and 
maintenance program or who fail the emissions test and choose not to repair 
their vehicle. There is not enough data to accurately predict how many vehicles 
will not be renewed; however, it is estimated that there will be a decrease of 
several million dollars in registration revenue annually.
There will be an additional cost to the state of $164,321 in fiscal year 1998, 
$59,258 in fiscal year 1999, $60,444 in fiscal year 2000, $61,048 in fiscal year 
2001, and $61,058 in fiscal year 2002 for programming and personnel costs. There 
will be no effect on local governments. The economic costs to individuals who 
are required to comply with the section as proposed cannot be determined because 
the cost to repair a vehicle so that it meets emission standards depends on its 
mechanical status. There could be considerable economic costs to persons who are 
required to comply with the new section as proposed, in particular those 
individuals with older model vehicles. 
Jerry L. Dike, Director, Vehicle Titles and Registration Division, has 
determined that for the first five-year period the section is in effect, the 
public benefit anticipated as a result of enforcing or administering the new 
section will be to ensure compliance with federal regulations, thereby assuring 
that Texas will not lose federal construction funds because of non-compliance. 
This should also reduce the number of higher pollution vehicles in these areas 
and increase air quality; however, we cannot determine a reduction percentage. 
In addition, the section will provide an efficient and effective enforcement 
system for enforcing emission standards. 
Mr. Dike has certified that there will be some impact on local economies or 
overall employment as a result of enforcing or administering the proposed new 
section, but cannot determine the extent because the number and type of repairs 
will vary with the vehicle. There will be some effect on small businesses that 
use vehicles which do not pass the emissions test. 
Written comments on the proposal may be submitted to Jerry L. Dike, Director, 
Vehicle Titles and Registration Division, Texas Department of Transportation, 
125 East 11th Street, Austin, Texas 78701-2483. The deadline for receipt of 
written comments will be 5:00 p.m. on July 13, 1998. 
The new section is proposed under Transportation Code, sec.201.101, which 
provides the Texas Transportation Commission with the authority to establish 
rules for the conduct of the work of the Texas Department of Transportation, and 
more specifically, Transportation Code, sec.502.009, which authorizes the 
department to deny registration or re-registration for vehicles in nonattainment 
areas that do not meet the emissions standards. 
No statutes, articles, or codes are affected by this proposed new section.

sec.17.52.Vehicle Emissions Enforcement System.
(a) Purpose. Transportation Code, sec.502.009 requires the department to 
implement a system requiring verification that a vehicle complies with vehicle 
emissions inspection and maintenance (I/M) programs as required by the Health 
and Safety Code, sec.382.037 and sec.382.0372, and Transportation Code, Chapter 
548, Subchapter F. This section prescribes the policies and procedures for a 
denial of registration enforcement system if a vehicle does not comply with the 
emission standards set by federal and state laws and the provisions of the Texas 
air quality State Implementation Plan. 
(b) Definitions. The following words and terms, when used in this section, shall 
have the following meanings, unless the context clearly indicates otherwise. 
(1) Department - The Texas Department of Transportation. 
(2) DPS - The Texas Department of Public Safety. 
(3) Nonattainment area - Any portion of an air quality control region where any 
pollutant exceeds the national ambient air quality standards for the pollutant 
as designated pursuant to the Federal Clean Air Act. 
(4) State Implementation Plan (SIP) - A document required by the United States 
Environmental Protection Agency that commits to the adoption and implementation 
of a vehicle emissions I/M program which meets all the requirements of the 
Environmental Protection Agency. 
(5) TNRCC - The Texas Natural Resource Conservation Commission.
(6) Vehicle - A motor driven or propelled vehicle required to be registered in 
the state, except those vehicles exempted by the TNRCC.
(7) Vehicle inspection report - A vehicle inspection form prescribed by the DPS 
that is printed by the vehicle exhaust gas analyzer immediately following an 
emissions test. 
(8) Waiver - A form and certificate that allows a vehicle to be considered in 
compliance with the vehicle emission I/M program for a specified period of time 
after a vehicle fails an emissions test. 
(c) Conditions to vehicle registration denial. 
(1) The DPS, after notice to the vehicle owner, will notify the department if a 
motor vehicle owner fails to comply with the requirements of Transportation 
Code, Subchapter F. 
(2) The TNRCC, after notice to the vehicle owner, will notify the department if 
a motor vehicle fails to comply with the requirements of Health and Safety Code, 
sec.382.037 and sec.382.0372 and Transportation Code, Chapter 548, Subchapter F. 
(3) The notice will include the vehicle identification number (VIN) and the 
registration plate number of the affected vehicle. 
(4) If the department receives a notice of emission noncompliance from the DPS 
or TNRCC, the department will place a notation on the motor vehicle record that 
the motor vehicle has failed to comply with the vehicle emission I/M program. 
(5) If the department receives a notice of emission compliance from the DPS or 
TNRCC, the department will remove the non-compliance notation from the motor 
vehicle record. 
(6) If a vehicle record contains a notation of failure to comply with the 
vehicle emissions I/M program, the tax assessor-collector will deny registration 
unless provided with: 
(A) proof of compliance with the vehicle emissions I/M program with a "passing" 
vehicle inspection report; or 
(B) proof of a waiver issued by the DPS or TNRCC that includes the vehicle 
identification number (VIN) and the registration plate number.
(7) The DPS and TNRCC will provide the department with the notifications on a 
weekly basis in an electronic format approved by the department. 
(8) The DPS and the TNRCC will pay the department for the notifications on a 
quarterly basis in accordance with a memorandum of agreement with the 
department. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on June 1, 1998.
TRD-9808792
Bob Jackson
Acting General Counsel
Texas Department of Transportation
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 463-8630

CHAPTER 25.Traffic Operations
SUBCHAPTER G.Specific Information Logo Sign Program
43 TAC sec.25.406, sec.25.409
The Texas Department of Transportation proposes amendments to sec.25.406 and 
sec.25.409, concerning the specific information logo sign program. 
EXPLANATION OF PROPOSED AMENDMENTS 
These amendments are proposed by Senate Bill 370, sec.2.04, 75th Legislature, 
1997, which added Transportation Code, sec.391.098, requiring the Texas 
Transportation Commission to authorize the executive director to grant variances 
on a case-by-case basis, to the eligibility, location, or placement of specific 
information logo signs, major agricultural interest signs, and major shopping 
area guide signs. 
The department adopted rules to implement provisions of Senate Bill 370 which 
became effective on March 19, 1998. These rules allowed for variances to be 
requested for only major shopping area guide signs. During the public comment 
period, the department received several comments requesting that variances also 
be allowed for the logo sign program. The department also received comments that 
indicated the criteria under which a variance could be requested for major 
shopping area guide signs should be broadened. These amendments take the 
comments into consideration and specify which requests for variances the 
department will consider. However, at this time, the sections are not being 
amended to allow for variance in the major agricultural interest sign program 
because the program is too new to determine what variance may be needed. 
Section 25.406 is amended by adding subsection (d) which describes the 
conditions under which a person may request a variance from the information logo 
sign program for waiver of the requirements of eligibility, location, placement, 
and type of highway. The section authorizes the department to require additional 
documentation including, but not limited to, traffic studies, maps, traffic flow 
analysis, crash data and analysis, and a detailed site plan of the commercial 
establishment, and describes the conditions under which the executive director 
may grant or deny the variance. This new subsection requires the executive 
director to indicate the reason for granting or denying the requested variance 
in writing. 
The amendments do not allow a variance to be requested from certain eligibility 
requirements of the information logo sign program. A commercial establishment 
may not request a variance from the sec.25.406(a) eligibility provisions that it 
must: offer at least one primary motorist service (gas, food, lodging, or 
camping); have a driveway access to a frontage road, ramp, or intersecting 
crossroad; comply with all applicable laws concerning the provisions of public 
accommodations without regard to race, religion, color, sex or national origin; 
or post its hours of operation on or near the main entrance so that they are 
visible to the public during open and closed hours. 
The department is retaining these eligibility requirements to ensure that 
commercial establishments requesting a variance are still required to provide 
basic motorist services in a non-discriminatory fashion that will best serve the 
needs of the traveling public. 
In addition to the eligibility requirements noted above, commercial 
establishments may not request a variance from certain specific service 
requirements contained in sec.25.406(b). 
A commercial establishment requesting a variance for a "gas" logo sign must 
still meet the requirements contained in sec.25.406(b)(1) concerning the 
services and facilities that such an establishment must provide. 
A commercial establishment requesting a variance for a "food" logo sign must 
still meet the requirements contained in sec.25.406(b)(2)(A) requiring that the 
establishment provide a license or other evidence of compliance with public 
health or sanitation laws, or other applicable laws. Such an establishment must 
also still meet the requirements contained in sec.25.406(b)(2)(C)-(E) requiring 
that the establishment have seating for at least 16 people, a public restroom, 
and a public telephone. 
A commercial establishment requesting a "lodging" logo sign may not request a 
variance to the requirements contained in sec.25.406(b)(3) that the 
establishment have a license, at least 10 rooms, and a public telephone. 
A commercial establishment requesting a "camping" logo sign may not request a 
variance to the requirements contained in sec.25.406(b)(4) that the 
establishment have a commercial license, adequate parking accommodations, and 
modern sanitary facilities and drinking water. 
The department is not proposing permitting variances for these requirements for 
commercial establishments to ensure that all establishments noted by logo signs 
provide high-quality services to the traveling public. 
In addition to the above restrictions, a commercial entity may not request a 
variance from the requirement that the establishment be located on and the logo 
sign be erected on the state highway system. This restriction is necessary to 
ensure that the program is operated only on highways under the department's 
jurisdiction. 
The amendments to sec.25.409 will allow broader types of variances to be 
requested for eligibility, location, placement, and type of highway for major 
shopping area guide sign. 
Major shopping areas will not be able to request a variance from the eligibility 
requirement contained in sec.25.409(a)(5). This requires that these 
establishments must post their hours of operation on or near the main public 
entrance. In addition to the above restriction, a major shopping area may not 
request a variance from the requirement that the establishment be located on, 
and the sign be erected on, a portion of the state highway system. This 
restriction is necessary to ensure that the program is operated only on highways 
under the state's jurisdiction. 
FISCAL NOTE 
Frank J. Smith, Director, Finance Division, has determined that for the first 
five-year period the amendments are in effect, there will be fiscal implications 
for state government as a result of enforcing or administering the amendments. 
There are no anticipated costs for persons required to comply with the sections 
as proposed. It is anticipated that the estimated additional state revenue for 
1998, 1999, 2000, 2001 and 2002 will be approximately $2,000 annually in 
additional royalties from the private contractor which operates the specific 
information logo sign program as a result of allowing variances to be requested 
from the requirements of that program. There will be no impact on local 
governments. 
David T. Newbern, P.E., Director, Traffic Operations Division, has certified 
that there will be no significant impact on local economies or overall 
employment as a result of enforcing or administering the amendments. 
PUBLIC BENEFIT 
Mr. Newbern has also determined that for each year of the first five years the 
amendments are in effect the public benefit anticipated as a result of enforcing 
or administering the amendments will be to ensure that variances may be 
requested by commercial establishments and major shopping areas for these 
signing programs. The traveling public may benefit from notification of a 
greater number of establishments which could serve their motoring needs. There 
will be no general effect on small businesses, although some individual small 
businesses may benefit from the erection of logo signs. 
SUBMITTAL OF COMMENTS
Written comments on the proposed amendments may be submitted to David T. 
Newbern, P.E., Director, Traffic Operations Division, 125 East 11th Street, 
Austin, Texas 78701-2483. The deadline for receipt of comments will be 5:00 p.m. 
on July 13, 1998. 
STATUTORY AUTHORITY 
The amendments are proposed under Transportation Code, sec.201.101, which 
provides the Texas Transportation Commission with the authority to establish 
rules for the conduct of the work of the Texas Department of Transportation, and 
more specifically, Transportation Code, sec.391.098, which requires the Texas 
Transportation Commission to authorize the executive director to grant variances 
on a case-by-case basis to the eligibility, location, and placement of major 
shopping area guide signs.
No other statutes, articles, or codes are affected by these proposed amendments.

sec.25.406.Commercial Establishment Eligibility. 
(a) General requirements for eligibility. To be eligible to have a business logo 
placed on a specific information logo sign, a commercial establishment must: 
(1) - (2) (No change.)
(3) be visible, or have on-premise signing visible, from the commercial 
establishment's driveway access or the exit ramp, access road, crossroad, or 
intersection; <nl>and<ol>
(4) be located within the marketing inventory as stated in sec.25.402(b) of this 
title (relating to Information Logo Sign Program) but not farther than three 
miles from an interchange on an eligible highway<nl>, but<ol> [;] 
[(5)] if no service participating or willing to participate in the specific 
information logo sign program is located within three miles of an interchange, 
the department may approve commercial establishments of the same service: 
(A) if located not farther than six miles from the interchange;
(B) nine miles from the interchange if no service participating or willing to 
participate is located six miles from the interchange; 
(C) 12 miles from the interchange if no service participating or willing to 
participate is located nine miles <nl>from<ol> [of] the interchange; or 
(D) 15 miles from the interchange if no service participating or willing to 
participate is located 12 miles <nl>from<ol> [of] the interchange; 
<nl>(5)<ol> [(6)] comply with all applicable laws concerning the provisions of 
public accommodations without regard to race, religion, color, sex, or national 
origin; and 
<nl>(6)<ol> [(7)] post its hours of operation on or near the main entrance so 
that they are visible to the public during open and closed hours. 
(b) Specific services eligibility. In addition to the general requirements for 
eligibility to have a business logo placed on a specific information logo sign, 
a commercial establishment must meet the requirements for at least one of the 
following primary motorist services. 
(1) (No change.)
(2) Food. To be eligible to have a business logo placed on a specific 
information logo sign carrying the legend "FOOD," a commercial establishment 
must provide: 
(A) a license or other evidence of compliance with public health or sanitation 
laws, if required by [applicable other] law;
(B) - (E) (No change.)
(3) Lodging. To be eligible to have a business logo placed on a specific 
information logo sign carrying the legend "LODGING," a commercial establishment 
must provide: 
(A) a license or other evidence of compliance with laws regulating facilities 
providing lodging, if required by [applicable other] law; 
(B) - (C) (No change.)
(4) Camping. To be eligible to have a business logo placed on a specific 
information logo sign carrying the legend "CAMPING," a commercial establishment 
must provide: 
(A) a license or other evidence of compliance with laws regulating camping 
facilities, if required by [applicable other] law; 
(B) - (C) (No change.)
(c) (No change.)
<nl>(d)<ol> Variances. 
<nl>(1)<ol> A person may request a variance from the information logo sign 
program. Requests for variances will only be considered if the existing 
requirements preclude participation in the program. 
<nl>(2)<ol> A variance may be requested for a waiver of an eligibility 
requirement except for the: 
<nl>(A)<ol> requirements listed in subsections (a)(1), (2), (6), and (7) and 
(b)(1), (b)(2)(A), (b)(2)(C)-(E), and (b)(3)-(4) of this section; 
<nl>(B)<ol> location of the establishment; 
<nl>(C)<ol> placement of the sign; or 
<nl>(D)<ol> highway, except the highway must be on the state highway system. 
<nl>(3)<ol> A person may submit a request for a variance to the department's 
local district engineer indicating: 
<nl>(A)<ol> which requirement of the program it does not meet; and 
<nl>(B)<ol> the variance requested. 
<nl>(4)<ol> The department may require additional documentation following 
generally accepted engineering standards, which shall include, but not be 
limited to: 
<nl>(A)<ol> traffic studies; 
<nl>(B)<ol> maps indicating ramps, major arterials, ingress and egress points, 
existing signs and distances; 
<nl>(C)<ol> traffic flow analysis including traffic counts to and from the 
commercial establishment or major shopping area; 
<nl>(D)<ol> crash data and analysis; and 
<nl>(E)<ol> detailed site plan of the commercial establishment or major shopping 
area, including but not limited to parking available, driveways, and location in 
reference to eligible highway or eligible urban highway.
<nl>(5)<ol> The executive director may grant a variance if he or she determines 
it is feasible to place the sign at the requested location and the sign meets 
the requirements of the Texas MUTCD; and 
<nl>(A)<ol> the variance will substantially promote traffic safety; 
<nl>(B)<ol> the variance will substantially improve traffic flow; 
<nl>(C)<ol> an overpass, highway sign or other highway structure unduly 
obstructs the visibility of an existing commercial sign; or 
<nl>(D)<ol> the variance is necessary to substantially improve the efficiency 
and effectiveness of communicating information needed by people to safely and 
efficiently use the transportation system. 
<nl>(6)<ol> The executive director will indicate the reason for granting or 
denying a variance in writing. 

sec.25.409.Major Shopping Area Eligibility.
(a) Eligibility criteria. To be eligible to have a major shopping area guide 
sign, the retail shopping mall must: 
(1)-(2) (No change.)
(3) include an enclosed gross building area of 1,000,000 square feet or more [of 
gross building area]; 
(4) - (5) (No change.)
(b) Variances. 
(1) A person may request a variance from the requirements of the major shopping 
area guide sign program. A request for a variance will only be considered if the 
existing requirements preclude participation in the program. 
(2) A variance may be requested for wavier of the requirement <nl> of<ol>: 
(A) <nl>eligibility except for the requirement of subsection (a)(5) of this 
section<ol> [of gross building area]; 
(B) <nl>location of the major shopping area<ol> [ of land acreage]; [or] 
(C) <nl>placement of the sign<ol> [that the series of buildings be connected to 
a common contiguous roof.] <nl>; or<ol>
<nl>(D)<ol> <nl> highway, except the highway must be on the state highway 
system. <ol>
(3) - (5) (No change.)
(6) The executive director will <nl>indicate<ol> [issue] the reason for granting 
or denying a variance in writing.
(7) (No change.)
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on June 1, 1998.
TRD-9808793
Bob Jackson
Acting General Counsel
Texas Department of Transportation
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 463-8630

SUBCHAPTER L.Telecommunications Facilities
43 TAC sec.sec.25.801-25.806
The Texas Department of Transportation proposes new sec.sec.25.801-25.806 
concerning telecommunications facilities in the right of way. 
EXPLANATION OF PROPOSED NEW SECTIONS 
Senate Bill 370, sec.1.20, 75th Legislature, 1997, created new Subchapter E in 
Chapter 202, Transportation Code, to allow the department to enter into an 
agreement for the placement of private telecommunications facilities within the 
median of a divided state highway. 
The new subchapter also allows the department to enter into an agreement with a 
telecommunications provider to place lines within or otherwise use 
telecommunications facilities owned or installed by the state in or on the 
improved portion of a state highway. The new subchapter allows the department to 
solicit proposals from telecommunications providers for use of the state highway 
system using a competitive process. This agreement may also include compensation 
to the department in the form of cash or the shared use of facilities. The new 
subchapter requires the department to develop rules. 
New sec.25.801 describes the purpose of the new subchapter, including 
implementing Transportation Code, Chapter 202, Subchapter E. 
New sec.25.802 provides definitions for words and terms used in new Subchapter 
L. 
New sec.25.803 defines the conditions under which the department may enter into 
an agreement with a telecommunications provider for use of department 
facilities. The department may enter into such an agreement if the agreement is 
in the best interest of the department; is consistent with the department's 
primary objectives in key areas such as safety and operations; allows the 
department to maximize revenues; and advances the department's efforts to 
develop its own telecommunications program. 
New sec.25.803 also allows a telecommunications provider to either place its 
facilities within the median of a divided state highway or use 
telecommunications facilities owned or installed by the department in or on the 
improved portion of a state highway consistent with Transportation Code, Chapter 
202, Subchapter E. 
New sec.25.803 allows for the telecommunications provider to offer consideration 
to the department in the form of payment, or in the shared use of 
telecommunications equipment. This provision is included to ensure that the 
department receives fair value for the use of its right of way and to maintain 
the department's flexibility in the development of a project with a private 
telecommunications provider. 
New sec.25.803 also includes a provision that confirms that a telecommunications 
provider still may place its facilities in the traditional utility corridor as 
authorized by state law and sec.sec.21.31-21.56 of this title (relating to 
Utility Accommodation). 
New sec.25.803 states that placement of telecommunications facilities on 
federal-aid highways is subject to approval from the Federal Highway 
Administration. The Federal Highway Administration is the department's federal 
funding partner on certain portions of the state highway system and the 
department believes that its acceptance of these installations is valuable. 
New sec.25.804 outlines the process by which the department will issue a request 
for proposals (RFP). This section describes what information, at a minimum, the 
department will include in each RFP issued under these new sections. This 
section also requires the department to issue an RFP in at least two general 
circulation newspapers, on the department's Internet web site, and in the Texas 
Register at least 45 days prior to the deadline for submission of a proposal to 
ensure that the RFP is widely circulated to all interested parties.
New sec.25.805 defines what information must be included in each proposal 
submitted to the department. These items are required to allow the department to 
effectively evaluate each proposal. 
New sec.25.806 defines how the executive director, or his or her designee, will 
evaluate, negotiate, and award a contract under these new sections. Proposals 
will be evaluated based on consistency with the department's primary goals and 
purposes such as safety and operational efficiency; maximization of revenue; 
development of the department's telecommunication infrastructure; and any other 
benefit accrued to the state. The executive director, or his or her designee, 
may negotiate and seek counteroffers from telecommunications providers. Also, as 
provided for in Transportation Code, Chapter 202, Subchapter E, the executive 
director, or his or her designee, may reject all offers should they not meet the 
department's needs. The department will notify the selected provider in writing. 
New sec.25.806 also outlines the manner in which the contract will be executed. 
Contract execution is required within 90 days from award. This provision is to 
ensure that, once a contract is awarded, it is executed in a reasonable time 
frame. 
New sec.25.806 states that the agreement may also allow a telecommunications 
provider to have exclusive use of a portion of the department's median or other 
facilities. Exclusivity is allowed to make the offer of use of the department's 
median or facilities of maximum value. 
The new section also states that the department may require the 
telecommunications provider to be a wholesaler of telecommunications capacity. 
The provision is included to allow the department to have maximum flexibility on 
the manner in which any agreement for use of state right of way is structured.
New sec.25.806 also states that the agreement will include provisions for 
termination and may include provisions requiring the removal of any improvements 
placed on state right of way to be removed at the provider's expense. This 
provision is to ensure that, should termination of the contract be deemed 
necessary, the provider will be responsible for removal of all 
telecommunications improvements installed on state right of way. 
New sec.25.806 requires the telecommunications provider to notify the department 
prior to entering department right of way to perform any installation, 
maintenance, or operation. It also requires the provider to conform to the 
requirements of the Texas Manual on Uniform Traffic Control Devices in all 
traffic control plans. This provision is included to ensure that all work 
performed on state right of way is accomplished in the safest and most efficient 
manner possible and with the least amount of impact on the traveling public. New 
sec.25.806 places responsibility for maintenance of any installation with the 
telecommunications provider to ensure that any telecommunications infrastructure 
placed on department right of way is adequately maintained.
FISCAL NOTE 
Frank J. Smith, Director, Finance Division, has determined that for the first 
five-year period the new sections are in effect, there will be fiscal 
implications for the state in administering the new sections. It is anticipated 
that for the years 1999-2003, the state will receive approximately $5.54 million 
in additional revenue as a result of the implementation of these new sections. 
This benefit to the state may be either in the form of cash or in the use of 
telecommunications facilities. There will be no fiscal implications for local 
governments as a result of enforcing or administering the new sections. There 
are no anticipated costs for persons required to comply with the sections as 
proposed. 
David T. Newbern, P.E., Director, Traffic Operations Division, has certified 
that there will be no significant impact on local economies or overall 
employment as a result of enforcing or administering the new sections. 
PUBLIC BENEFIT 
Mr. Newbern has also determined that for each year of the first five years the 
sections are in effect, the public benefit anticipated as a result of enforcing 
or administering the new sections will be to allow telecommunications providers 
access to portions of the state highway system for their use in exchange for 
cash or telecommunications services, thereby improving statewide 
telecommunications services for both the public and the department. There will 
be no effect on small businesses. 
PUBLIC HEARING 
Pursuant to the Administrative Procedure Act, Government Code, Chapter 2001, the 
Texas Department of Transportation will conduct a public hearing to receive 
comments concerning the proposed new sections. The public hearing will be held 
at 9:00 a.m. on June 30, 1998, in the first floor hearing room of the Dewitt C. 
Greer State Highway Building, 125 East 11th Street, Austin, Texas and will be 
conducted in accordance with the procedures specified in 43 TAC sec.1.5. Those 
desiring to make comments or presentations may register starting at 8:30 a.m. 
Any interested persons may appear and offer comments, either orally or in 
writing; however, questioning of those making presentations will be reserved 
exclusively to the presiding officer as may be necessary to ensure a complete 
record. While any person with pertinent comments will be granted an opportunity 
to present them during the course of the hearing, the presiding officer reserves 
the right to restrict testimony in terms of time and repetitive content. 
Organizations, associations, or groups are encouraged to present their commonly 
held views and identical or similar comments through a representative member 
when possible. Comments on the proposed text should include appropriate 
citations to sections, subsections, paragraphs, etc. for proper reference. Any 
suggestions or requests for alternative language or other revisions to the 
proposed text should be submitted in written form. Presentations must remain 
pertinent to the issues being discussed. A person may not assign a portion of 
his or her time to another speaker. A person who disrupts a public hearing must 
leave the hearing room if ordered to do so by the presiding officer. Persons 
with disabilities who plan to attend this meeting and who may need auxiliary 
aids or services such as interpreters for persons who are deaf or hearing 
impaired, readers, large print or braille, are requested to contact Eloise 
Lundgren, Director, Public Information Office, 125 East 11th Street, Austin, 
Texas 78701-2483, 512/463-8588 at least two working days prior to the hearing so 
that appropriate services can be provided. 
SUBMITTAL OF COMMENTS 
Written comments on the proposed new sections may be submitted to David T. 
Newbern, P.E., Director, Traffic Operations Division, Texas Department of 
Transportation, 125 East 11th Street, Austin, Texas 78701-2483. The deadline for 
receipt of comments will be 5:00 p.m. on July 13, 1998. 
STATUTORY AUTHORITY 
The new sections are proposed under Transportation Code, sec.2001.101, which 
provides the Texas Transportation Commission with the authority to establish 
rules for the conduct of the work of the Texas Department of Transportation, and 
more specifically, Transportation Code, Chapter 202, Subchapter E which 
authorizes the department to carry out the provisions of those laws governing 
the placement of telecommunications facilities on department right of way. No 
statutes, articles, or codes are affected by these proposed new sections.

sec.25.801.Purpose.
Transportation Code, Chapter 202, Subchapter E, authorizes the department to 
enter into a lease or other agreement with a telecommunications provider to 
allow the provider to place its telecommunications facilities on department 
right of way or to use facilities owned by the state. This subchapter prescribes 
the policies and procedures governing access by an agreement other than a lease. 

sec.25.802.Definitions.
The following words and terms, when used in this subchapter, shall have the 
following meanings, unless the context clearly indicates otherwise.
(1) Department - The Texas Department of Transportation including the Texas 
Turnpike Authority Division. 
(2) Executive director - The executive director of the department or his or her 
designee not below the level of district engineer, division director, or office 
director. For projects of the Texas Turnpike Authority Division of the Texas 
Department of Transportation, executive director means the Texas Turnpike 
Authority Board or the director of the Texas Turnpike Authority Division. 
(3) Improved portion - Any portion of the right of way that has been graded or 
to which surface material has been applied. 
(4) Median - The improved portion of the right of way of a divided highway 
either between opposing directions of travel or between the frontage road and 
the main travel lanes. 
(5) State highway - A segment of the system of highways in the state included in 
a comprehensive plan prepared by the department's executive director under the 
direction and with the approval of the commission in accordance with 
Transportation Code, sec.221.001. 
(6) Telecommunications - A transmission, emission, or reception of signs, 
signals, writings, images, or sounds of intelligence of any nature by wire, 
radio, optical, or other electromagnetic systems. 

sec.25.803.Use of Department Facilities.
(a) Agreement. 
(1) The department may enter into an agreement with a telecommunications 
provider if the provisions of the agreement would: 
(A) be of general benefit to the department; 
(B) be consistent with the department's safety, maintenance, operation, and 
beautification objectives; 
(C) allow the department to maximize revenue; and 
(D) advance the department's efforts to share or develop its own 
telecommunications program. 
(2) The agreement will allow the provider to: 
(A) place the provider's telecommunications facilities within the median of a 
divided state highway; or 
(B) use telecommunications facilities owned or installed by the department in or 
on the improved portion of a state highway, including the median, structures, 
equipment, conduit, or other component of the highway facility. 
(3) The agreement may provide for consideration to the department in the form 
of: 
(A) payment; 
(B) shared use of a telecommunication facility; or 
(C) equipment, facilities, or services. 
(4) The agreement will contain the specific details of each project. This 
agreement may include, but not be limited to, requirements concerning: 
(A) traffic control; 
(B) bonds and insurance; 
(C) coordination with existing and future department construction projects; 
(D) relocations; and 
(E) testing and inspection of telecommunications facilities.
(b) Traditional utility accommodation. Nothing in this section limits a 
telecommunications provider's ability to place facilities in the right of way as 
authorized by state law and in accordance with sec.sec.21.31-21.56 of this title 
(relating to Utility Accommodation). 
(c) Coordination with local governments. The agreement may require that, prior 
to installation, the provider demonstrates to the department that all affected 
city and county governments have been notified of the proposed placement of 
telecommunications facilities within their jurisdictions. 
(d) Federal Highway Administration approval. The placement of telecommunications 
facilities on federal-aid highways is subject to the approval of the Federal 
Highway Administration. 

sec.25.804.Request for Proposals.
(a) Notice. The department will publish a notice of intent to issue a request 
for proposals for the use of telecommunications facilities owned or installed by 
the department or for the placement of telecommunications facilities in the 
right of way. The notice will be published in at least two general circulation 
newspapers, on the department's Internet web site, and in the Texas Register at 
least 45 calendar days prior to the deadline for submission of a proposal. 
(b) Content. The request for proposal will include, but not be limited to, the: 
(1) description of the project; 
(2) geographic location and extent of the project; 
(3) technical construction and implementation information;
(4) date and time by which all complete proposals must be submitted; 
(5) number of copies required; and 
(6) required format and maximum length. 

sec.25.805.Proposals.
A proposal must be sealed and contain: 
(1) the contract number; 
(2) an organizational chart containing names of the:
(A) prime provider and any subproviders proposed for the team and their contract 
responsibilities; and 
(B) key personnel proposed for the contract and percent of their time to be 
dedicated to the project. 
(3) a summary of the project team qualifications;
(4) a clear and concise statement demonstrating an understanding of the scope 
and requirements of the project; 
(5) a description of how the provider proposes to meet the project's goals and 
objectives; 
(6) a proposed schedule of work which describes the provider's internal methods 
for schedule control; 
(7) an audited financial statement dated no later than the preceding fiscal 
year; 
(8) supporting information, such as charts, photographs, graphs, resumes, and 
references; and 
(9) other pertinent information addressed in the notice.

sec.25.806.Selection Process.
(a) Evaluation. The executive director will consider the following factors in 
evaluating the proposals: 
(1) consistency with the department's safety, maintenance, operation, and 
beautification objectives; 
(2) maximization of revenue or development of department telecommunications 
infrastructure; and 
(3) any other benefit to the department. 
(b) Counteroffer and negotiation. 
(1) The executive director may discuss an acceptable or potentially acceptable 
proposal with a telecommunications provider to assess the provider's ability to 
meet the solicitation requirements. 
(2) The executive director may permit the provider to revise its proposal in 
order to obtain the best final offer. If one provider is offered the opportunity 
to discuss and revise its offer, then all providers who meet the requirements 
will receive the same opportunity. 
(3) The executive director will not discuss or disclose the contents of 
competing proposals during the process of negotiation. 
(4) The executive director may reject all offers. 
(5) The executive director will notify the selected provider in writing. 
(c) Execution. 
(1) Agreement. The provider shall sign the agreement within 90 working days from 
the date of notification to the provider. 
(2) Exclusivity. The agreement may allow for the exclusive use of a portion of 
the department's median or other facilities. The agreement may require the 
provider to be a wholesaler of telecommunications capacity.
(3) Termination. The agreement will include provisions for termination and may 
include provisions requiring removal of improvements at the provider's cost in 
connection with termination. 
(4) Access to right of way. 
(A) The provider shall give the department 48 hours prior notice before entering 
department right of way to perform any installation, maintenance, or operation. 
The provider must follow a traffic control plan which incorporates the 
requirements of the Texas Manual on Uniform Traffic Control Devices. 
(B) The telecommunications provider may enter department right of way to correct 
an emergency situation if the department is notified as soon as practical after 
the event. Even under emergency conditions the provider shall follow traffic 
safety control procedures. 
(5) Maintenance. In the absence of specific provisions in the agreement, the 
telecommunications provider is responsible for all maintenance associated with 
installations. 
This agency hereby certifies that the proposal has been reviewed by legal 
counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of the Secretary of State, on June 1, 1998.
TRD-9808794
Bob Jackson
Acting General Counsel
Texas Department of Transportation
Earliest possible date of adoption: July 12, 1998
For further information, please call: (512) 463-8630