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Vernon's Texas Civil Statutes - TITLE 132

TITLE 132—OCCUPATIONAL AND BUSINESS REGULATION

CHAPTER ONE. BARBERS

Art. 8407. Penalty

     Whoever violates any provision of this chapter or fails or refuses to comply with any provision thereof shall be fined not to exceed one hundred dollars.

Acts 1921, 37th Leg., p. 155, ch. 79, § 17.

     CHAPTER FOUR—GASOLINE AND PETROLEUM PRODUCTS

Art. 8601. Sale under another name

     No person, firm or corporation, shall sell gasoline, benzine, naphtha, or other similar product of petroleum, capable of being used for illuminating, heating or power purposes, under any other than the true name of said products; and such petroleum products shall be subject to inspection by the proper authorities.

Acts 1919, p. 213.

Art. 8602. Shall mark containers

     No person, firm, association of persons, corporation or carrier selling or transporting for hire any gasoline, benzine, naphtha or other highly inflammable substance made from petroleum, shall fail to plainly mark the packages containing the same in accordance with the regulations of the Interstate Commerce Commission, unless such regulations should conflict with the provisions of this chapter.

Acts 1919, p. 213.

Art. 8603. Labeling receptacles or reservoirs of petroleum products

     No person, firm, association of persons, corporation or carrier selling or transporting any gasoline, benzine, naphtha or other similar product of petroleum, shall fail to truly label in large letters showing the name of such person, firm, association of persons, corporation or carrier on any tank car, barrel, cask, tank wagon, receptacle or reservoir in which any petroleum product shall be shipped or stored within this State, or from which sales or delivery of the same are to be made.

Acts 1919, p. 213. Amended by Acts 1933, 43rd Leg., p. 94, ch. 46, § 1; Acts 1935, 44th Leg., p. 396, ch. 154, § 1–a.

Art. 8604. Must not flash

     No person, firm, association of persons, or corporation shall sell or offer for sale any kerosene or distillate to be used for domestic cooking, illuminating, heating, or other domestic uses, having a flash point at a temperature below 112 degrees Fahrenheit, according to the United States official closed cup testing method of the United States Bureau of Mines.

Acts 1919, p. 213. Amended by Acts 1935, 44th Leg., p. 396, ch. 154, § 1; Acts 1937, 45th Leg., p. 648, ch. 318, § 1.

Art. 8605. Standard of gasoline or motor fuel

     (a) No person, firm, association of persons, or corporation shall sell, offer for sale, or expose for sale, or possess or store with the intention to sell, as gasoline or motor fuel, any substance, liquid, or product of petroleum which falls below the standard of gasoline or motor fuel, the minimum requirement of which such standard shall be determined by the following distillation range:

     1. When the thermometer reads 167 degrees Fahrenheit not less than ten (10) per cent shall be evaporated.

     2. When the thermometer reads 284 degrees Fahrenheit not less than fifty (50) per cent shall be evaporated.

     3. When the thermometer reads 392 degrees Fahrenheit not less than ninety (90) per cent shall be evaporated.

     4. The end or dry point of distillation must not be over 437 degrees Fahrenheit.

     5. The residue shall not exceed two (2) per cent.

     6. Sulphur shall not exceed twenty one hundredths (0.20) per cent.

     (b) Motor fuel or gasoline shall be volatile hydro-carbon fuel, free from water and suspended matter, and shall be practicable and/or suitable for use as fuel in internal combustion engines.

Acts 1919, p. 213. Amended by Acts 1933, 43rd Leg., p. 94, ch. 46, § 2; Acts 1935, 44th Leg., p. 396, ch. 154, § 2.

Art. 8606. Inferior motor fuel

     (a) Liquids, substances, or products of petroleum used, or intended for use, as gasoline or motor fuel, not meeting the minimum requirements and specifications prescribed in Article 1105 hereof for gasoline or motor fuel, shall be known and designated as "Inferior Motor Fuel," and all pumps, receptacles, tanks or containers from which such inferior motor fuel may be sold, offered for sale, or exposed for sale, or in which such inferior motor fuel is stored, or transported with the intention to sell, shall be labeled, in plain, legible lettering in the English language in the full view of the public, with the words "Inferior Motor Fuel," which such lettering shall be of solid black type not less than two (2) inches in height with not less than one-half inch paint stripe of black oil paint on white oil paint background; and it is further provided that any person who shall sell or exchange any such motor fuel shall be required to plainly show on each and every invoice, manifest, ticket or bill of exchange that the commodity sold or exchanged is inferior motor fuel.

     (b) No person, firm, association of persons or corporation shall sell or offer for sale as lubricating oil, any oil that has been rerun, refiltered, reclaimed or refined from crank case draining or any other oil that has been theretofore used for purposes of lubrication, unless the said oil is sold as and labeled "Reconditioned Motor Oil". The words "Reconditioned Motor Oil" shall be plainly and legibly printed on each container, which said lettering shall be imprinted in two (2) places on the container or label in a manner that said lettering will appear both on the front and back surface of the container when displayed to the public in sale displays, and which said lettering shall be in letters of not less than three-sixteenths (<sfr>3/16<efr>) of an inch in height and not less than one-sixteenth (<sfr>1/16<efr>) of an inch in the width of each line used to form said letters.

     (c) No person, firm, association of persons or corporation shall sell at retail, or offer for sale at retail, as gasoline or motor fuel to propel motor vehicles upon the roads, streets and highways of Texas, either alone or when blended with other products, any unrefined liquid, substance or residuum of natural gas formed in and extracted or expelled in its natural state from any pipe line or tank conveying or containing natural gas, unless the said liquid, substance or residuum sold at retail or offered for sale at retail in its unrefined state is labelled as "Drip Gasoline," and all pumps, receptacles, tanks or containers of any retail service station through which such drip gasoline may be sold or offered for sale to propel motor vehicles upon the roads, streets and highways of Texas, either alone or when blended with other products, shall be labelled in plain, legible lettering in full view of the public, with letters of solid black type not less than two (2) inches in height and one half (˝) inch in width with the words "Drip Gasoline." Provided that nothing herein shall be construed as requiring the labelling of any derivative of natural gas which has been refined into an appropriate blending material free of dirt, oil and other suspended matter.

Acts 1919, p. 213. Amended by Acts 1933, 43rd Leg., p. 94, ch. 46, § 3; Acts 1935, 44th Leg., p. 396, ch. 154, § 3; Acts 1951, 52nd Leg., p. 148, ch. 88, § 1; Acts 1955, 54th Leg., p. 1038, ch. 393, § 1.

Art. 8607. Tests of petroleum products

     The apparatus and methods of conducting all tests and arriving at proper standards of gasoline and other products under this Act shall be those now or hereafter authorized and used by the U.S. Bureau of Mines.

Acts 1919, 36th Leg., p. 213, ch. 125.

Art. 8608. Using incorrect measure

     No person, firm, association of persons, corporation or carrier, shall use any scales, measure or measuring device in the handling or sale of petroleum products unless the same is true and accurate according to the standard of weights and measures under the laws of this State nor use any pumping device unless the same is correct according to such standard at three speeds, fast, slow and medium.

Acts 1919, 36th Leg., p. 213, ch. 125.

Art. 8609. Breaking seal on incorrect measure

     The inspector shall seal and forbid the use of any inaccurate measuring device until such time as the defect is corrected. The breaking of said official seal shall be prima facie evidence of a violation of this law and no person, firm, association of persons, corporation or carrier shall refuse to permit the inspector provided for by law to inspect and seal, if deemed necessary, any such measuring device, or to break the seal after being placed by such inspector.

Acts 1919, 36th Leg., p. 213, ch. 125, § 9.

Art. 8610. Hindering inspector

     The Director of the Food and Drug Division of the State Board of Health, his inspectors, or any duly authorized representative appointed by the State Comptroller for that purpose, or any highway patrolman, or sheriff, or deputy sheriff, or any other peace officer shall have, in the performance of his duties under this law, the power to inspect any premises or place where petroleum products are made, prepared, stored, transported, sold or offered for sale or exchange, take samples of same, and test measuring devices. It shall be unlawful for any person to hinder or obstruct or refuse to permit said inspectors or any other persons duly authorized to perform said duties in the exercise of such powers.

Acts 1919, 36th Leg., p. 213, ch. 125, §§ 10, 11. Amended by Acts 1933, 43rd Leg., p. 94, ch. 46, § 4.

Art. 8610a. Liquefied petroleum gas containers

     (a) In this article:

     (1) "Liquefied petroleum gas" means the hydrocarbon product extracted from natural gas or crude oil and commonly known as butane or propane.

     (2) "Person" means an individual, association, or corporation.

     (b) A person who is in the business of leasing or selling liquefied petroleum gas containers shall give to every prospective purchaser or user of such a container:

     (1) written notice of the purchase or use options provided by that business, including, if applicable, options to purchase, lease, or lease-purchase; and

     (2) a written statement that other persons in the business of leasing or selling liquefied petroleum gas containers may provide purchase or use options that include purchase, lease, and lease-purchase.

     (c) If a person who is in the business of leasing or selling liquefied petroleum gas containers signs a supply contract with another person, a separate agreement on the face of the contract must state that the supplier has given to the user the notice and statement required by Subsection (b) of this article before the user signs the supply contract.

     (d) Except as provided by Subsection (e) of this article, a person commits an offense if the person:

     (1) sells, fills, refills, delivers or permits to be delivered, or uses a liquefied petroleum gas container for any purpose;

     (2) is not the owner of the container; and

     (3) does not have written authorization of the owner.

     (e) A person who is not the owner of a liquefied petroleum gas container may fill or refill the container if the person who occupies the premises where the container is located requests the service and signs a written request that states that an emergency exists and that the owner is unavailable to provide that service.

     (f) A person who is not the owner of a liquefied petroleum gas container commits an offense if he obtains a written request under Subsection (e) of this article through misrepresentation.

     (g) A person who is not the owner of a liquefied petroleum gas container commits an offense if the person defaces, removes, or conceals a name, mark, initial, or device on the container without the written consent of the owner.

Added by Acts 1987, 70th Leg., ch. 178, § 1, eff. Sept. 1, 1987.

Art. 8611. Punishment

     Any person who shall knowingly violate any of the provisions of Articles 8601 through and inclusive of Article 8610a, Revised Statutes, shall be guilty of a misdemeanor, and upon conviction shall be fined in a sum not less than Twenty-five Dollars ($25) nor more than Two Hundred Dollars ($200).

Acts 1919, 36th Leg., p. 213, ch. 125. Amended by Acts 1935, 44th Leg., p. 396, ch. 154, § 4; Acts 1987, 70th Leg., ch. 178, § 2, eff. Sept. 1, 1987.

Art. 8612. Motor fuel franchisors; requiring franchisee to pay fee, charge or discount for honoring franchisor's credit card prohibited

Definitions

     Sec. 1. In this Act:

     (1) "Franchisee" means a distributor and/or retailer who is authorized or permitted, under a franchise, to use a trademark in connection with the sale, consignment, or distribution of motor fuel.

     (2) "Franchisor" means a refiner and/or distributor who authorizes or permits, under a franchise, the use of a trademark in connection with the sale, consignment, or distribution of motor fuel.

     (3) "Franchise" includes:

     (A) any contract under which a distributor and/or retailer is authorized or permitted to occupy marketing premises which are to be employed in connection with the sale, consignment, or distribution of motor fuel under a trademark which is owned or controlled by the franchisor-refiner or by a refiner who supplies motor fuel to a distributor who authorizes or permits such occupancy;

     (B) any contract pertaining to the supply of motor fuel which is to be sold, consigned, or distributed under a trademark owned or controlled by a refiner;

     (C) the unexpired portion of any franchise which is transferred or assigned as authorized by the provisions of such franchise or by any applicable provision of state or federal law which permits such transfer or assignment without regard to any provision of the franchise.

The term "Franchise," as used in this Act, does not include a contract made in the distribution of motor fuels through a card-lock or key-operated pumping system where neither of the parties to the contract is refiner or producer of such motor fuel.

     (4) "Wholesale Price" means the invoice price or purchase price per gallon charged to the franchisee who buys motor fuel, plus any excise tax paid by the buyer, plus reasonable freight charges, if freight charges are paid by the buyer, minus that portion of any refunds, rebates or subsidies not designed to offset the fee, charge or discount described in Section 2.

     (5) "Motor Fuel" includes diesel fuel delivered to service stations by a franchisor and gasoline that are usable as propellants of a motor vehicle.

Prohibited Practices

     Sec. 2. A franchisor shall not require a franchisee to pay to the franchisor any fee, charge, or discount for honoring the credit card issued by the franchisor or for submitting to the franchisor, for payment or credit to the franchisee's account, documents or other evidence of indebtedness of the holder of the card issued by the franchisor; provided, however, that a franchisor may require a franchisee to pay such a fee, charge, or discount if such franchisor with consideration of competitive prices in the relevant market has adjusted the wholesale prices charged and/or rebates credited to franchisees for motor fuel by amounts which on average for franchisees in the State of Texas substantially offset such fee, charge, or discount.

Remedies

     Sec. 3. (a) If a franchisor violates the provisions of Section 2 of this Act, the franchisee may maintain a civil action against such franchisor. Such action may be brought, without regard to the amount in controversy, in the district court in any county in which the franchisor or franchisee is doing business.

     (b) In any action under Subsection (a) of this section, the court shall award to the franchisee who prevails in an action brought hereunder the amount of actual damages and grant such equitable relief as the court determines is necessary to remedy the effects of franchisor's violation of the provisions of Section 2 of this Act, including declaratory judgment, permanent injunctive relief, and temporary injunctive relief. In addition, the court shall award to a franchisee who prevails in an action brought hereunder court costs and attorney's fees that are reasonable in relation to the amount of work expended.

     (c) In addition to the remedies provided in Subsection (b) of this section, if the trier of fact finds that the violation was committed wilfully and knowingly by the defendant, the trier of fact shall award not more than three times the amount of actual damages.

     (d) In any action under Subsection (a) of this section, the franchisor shall bear the burden of establishing the offset described in Section 2 of this Act as an affirmative defense.

     (e) Any action alleging a violation of Section 2 of this Act shall be commenced and prosecuted within two years after the cause of action has accrued.

Acts 1983, 68th Leg., p. 2027, ch. 368, §§ 1 to 3, eff. Sept. 1, 1983.

Art. 8613. Refueling services to disabled persons

Definition

     Sec. 1. In this Act, "refueling service" means the service of pumping motor vehicle fuel into the fuel tank of a motor vehicle.

Refueling services for disabled persons

     Sec. 2. (a) Each person, firm, partnership, association, trustee, or corporation that operates a gasoline service station or other facility that offers gasoline or other motor vehicle fuel for sale to the public from the facility shall provide, on request, refueling service to a disabled driver of a vehicle that displays a special device or disabled person identification card authorized by Chapter 338, Acts of the 64th Legislature, Regular Session, 1975 (Article 6675a–5e.1, Vernon's Texas Civil Statutes).

     (b) The price charged for the motor vehicle fuel provided under Subsection (a) of this section may not be greater than the price the facility otherwise would charge the public generally to purchase motor vehicle fuel without refueling service.

Exemptions

     Sec. 3. This Act does not apply to:

     (1) a gasoline service station or other facility that offers gasoline or other motor vehicle fuel for sale to the public from the facility:

     (A) if the station or other facility has only remotely controlled pumps and never provides pump island service; or

     (B) during regularly scheduled hours in which, for security reasons, a station or facility that ordinarily provides pump island service does not provide that service; or

     (2) refueling service to provide liquefied gas, as that term is defined by Section 153.001, Tax Code.

Notice

     Sec. 4. (a) The Department of Agriculture shall provide a notice setting forth the provisions of this Act to each person, firm, partnership, association, trustee, or corporation that operates a gasoline service station or other facility that offers gasoline or other motor vehicle fuel for sale to the public from the facility.

     (b) The Texas Department of Transportation shall provide a notice setting forth the provisions of this Act to each disabled person who is issued a special device or disabled person identification card under Chapter 681, Transportation Code .

Offense

     Sec. 5. (a) A person who is a responsible managing individual setting service policy of a station or facility covered by this Act or is an employee acting independently against established service policy and who violates Section 2 of this Act commits an offense.

     (b) An offense under this section is a Class C misdemeanor.

Enforcement

     Sec. 6. In addition to enforcement by the prosecuting attorney who represents the state, this Act may be enforced by the attorney general.

Acts 1989, 71st Leg., ch. 948, eff. Sept. 1, 1989. Sec. 3 amended by Acts 1990, 71st Leg., 6th C.S., ch. 9, § 1, eff. Sept. 6, 1990; Sec. 4(b) amended by Acts 1995, 74th Leg., ch. 165, § 22(20), eff. Sept. 1, 1995.

Art. 8614. Sales of certain fuel mixtures

Definitions

     Sec. 1. In this Act:

     (1) "Automotive fuel rating" has the meaning assigned by 15 U.S.C. Section 2821.

     (2) "Dealer" means a person who is the operator of a service station or other retail outlet and who delivers motor fuel into the fuel tanks of motor vehicles or motor boats.

     (3) "Motor fuel" has the meaning given that term by Section 153.001, Tax Code.

Testing

     Sec. 2. In order to determine compliance with the standards and for the enforcement of rules adopted under Sections 3, 3A, 3B, 4, and 5 of this Act, the commissioner of agriculture or an authorized representative of the commissioner may test any motor fuel sold in this state, with or without a complaint about the fuel. Nothing under this section shall prohibit the commissioner from adopting rules relating to the frequency of testing motor fuels. In adopting such rules the commissioner shall consider the nature of the violation, history of past violations, and funds available as provided by Subsection (e), Section 9 of this Act.

Posting notice of sale of alcohol and motor fuel mixture

     Sec. 3. (a) A motor fuel dealer in this state may not sell or offer for sale any motor fuel from a motor fuel pump that is supplied by a storage tank into which motor fuel containing ethanol in a mixture in which one percent or more of the mixture measured by volume is ethanol or into which motor fuel containing methanol in a mixture in which one percent or more of the mixture measured by volume is methanol has been delivered within the 60–day period preceding the day of sale or offer of sale, unless the dealer prominently displays on the pump from which the mixture is sold a sign that complies with the requirements of Subsection (b) of this section.

     (b)(1) The sign required under Subsection (a) of this section must be displayed on each face of the motor fuel pump on which the price of the motor fuel mixture sold from the pump is displayed. The sign must state "Contains Ethanol" or "Contains Methanol," as applicable. The sign must appear in contrasting colors with block letters at least one-half inch in height and one-fourth inch in width and shall be displayed in a clear, conspicuous, and prominent manner, visible to customers using either side of the pump.

     (2) In addition to the requirements of Subsection (b)(1) of this section, if a motor fuel pump is supplied by a storage tank into which motor fuel containing 10 percent or more ethanol by volume or five percent or more methanol by volume has been delivered within the 60–day period preceding the day of the sale or offer of sale, the sign shall state the percentage of ethanol or methanol by volume, to the nearest whole percent, of the motor fuel having the highest percentage of ethanol or methanol delivered into that storage tank within the 60–day period. This subsection does not prohibit the posting of other alcohol or additive information, the information and posting being subject to regulations by the commissioner of agriculture.

Sale of Motor Fuel with Automotive Fuel Rating Lower than Rating Posted on Pump Label

     Sec. 3A. A motor fuel dealer in this state may not sell or offer for sale motor fuel from a motor fuel pump if the motor fuel contains an automotive fuel rating that is lower than the automotive fuel rating for that motor fuel posted on the motor fuel pump.

Delivery of Motor Fuel with Automotive Fuel Rating Lower than Rating Certified by Transfer

     Sec. 3B. A distributor or supplier of motor fuel, as those persons are defined by Section 153.001, Tax Code, may not deliver or transfer motor fuel to a motor fuel dealer in this state if the fuel contains an automotive fuel rating that is lower than the certification of the automotive fuel rating the distributor or supplier is required to make to the motor fuel dealer under federal law.

Documentation of motor fuel mixture sales

     Sec. 4. (a) A distributor, supplier, wholesaler, or jobber of motor fuel, as those persons are defined by Section 153.001, Tax Code, may not make a delivery of motor fuel containing ethanol or methanol if the ethanol or methanol in the motor fuel mixture exceeds one percent by volume, other than a delivery made into the fuel supply tanks of a motor vehicle, to any outlet in this state unless the person delivers to the outlet receiving the delivery at the time of the delivery of the mixture:

     (1) the sign described in Section 3 of this Act in sufficient quantities for the dealer receiving the motor fuel mixture to comply with the requirements of this Act; and

     (2) a manifest, bill of sale, bill of lading, or any other document evidencing delivery of the motor fuel containing ethanol or methanol, which shall include a statement showing the percentage of ethanol or methanol contained in the mixture delivered, and the types and percentages of associated cosolvents, if any, contained in the mixture delivered. The document shall also show delivery of the sign or signs, as applicable, required to be delivered by this subsection.

     (b) On the request of any motor fuel user, a dealer must reveal the percentage of ethanol contained in motor fuel being sold, the percentage of methanol contained in motor fuel being sold, and, if the motor fuel contains methanol, the types and percentages of associated cosolvents contained in the motor fuel being sold.

     (c) The commissioner of agriculture by rule may prescribe the form of the statement required by Subsection (a) of this section.

     (d) The signs required to be posted by a motor fuel dealer under Section 3 of this Act and delivered to a motor fuel dealer under this section shall be obtained from the commissioner of agriculture.

     (e) If the commissioner of agriculture determines that certain types of motor fuel, such as diesel or liquefied petroleum gas, are not sold in this state as mixtures with alcohol in sufficient quantities to warrant regulation of those deliveries under this Act, the commissioner may limit the application of Section 3 of this Act and this section to motor fuels sold in sufficient quantity to warrant regulation.

Dealer and Delivery Documents

     Sec. 5. (a) Each motor fuel dealer in this state shall keep for one year a copy of each manifest, bill of sale, bill of lading, or any other document required to be delivered to the dealer by Section 4 of this Act. During the first 60 days following delivery of a fuel mixture covered by this Act, the dealer shall keep at the station or retail outlet where the motor fuel was delivered a copy of each manifest, bill of sale, bill of lading, or any other document required to be delivered to the dealer by Section 4 of this Act. Each distributor, supplier, wholesaler, or jobber of motor fuel shall keep for one year at the principal place of business a copy of each manifest, bill of sale, bill of lading, or any other document required to be delivered to the dealer by Section 4 of this Act. The documents are subject to inspection by the commissioner of agriculture or an authorized representative of the commissioner.

     (b) The commissioner of agriculture by rule may prescribe the manner of filing documents required to be kept under Subsection (a) of this section, and the time, place, and manner of inspection of the documents.

Documents Relating to Postings or Certification of Automotive Fuel Ratings

     Sec. 5A. (a) Each Motor Fuel Dealer in This State Shall Keep for at Least One Year a Copy of:

     (1) each delivery ticket or letter of certification on which the motor fuel dealer based a posting of the automotive fuel rating of motor fuel contained in a motor fuel pump;

     (2) records of any automotive fuel rating determination made by the motor fuel dealer under 16 C.F.R. Part 306; and

     (3) each delivery ticket or letter of certification that is required to be delivered to the dealer under 16 C.F.R. Part 306.

     (b) Each distributor or supplier shall keep for at least one year at the principal place of business a copy of each delivery ticket or letter of certification required to be delivered by the distributor or supplier to a motor fuel dealer in this state under 16 C.F.R. Part 306.

     (c) A document required to be kept under this section is subject to inspection by the commissioner of agriculture or an authorized representative of the commissioner.

Civil Action

     Sec. 6. (a) If a motor fuel dealer or a distributor, supplier, wholesaler, or jobber of motor fuel violates Section 3, 3A, 3B, 4, 5, or 5A of this Act, any motor fuel user who has purchased the fuel and who has suffered damages or has a complaint about the product may maintain a civil action against the motor fuel dealer or the distributor, supplier, wholesaler, or jobber of motor fuel. The action may be brought, without regard to any specific amount in damages, in the district court in any county in which the motor fuel dealer, distributor, supplier, wholesaler, or jobber is doing business or in which the motor fuel dealer resides.

     (b) In any action under this section, the court shall award to the motor fuel user who prevails the amount of actual damages and grant such equitable relief as the court determines is necessary to remedy the effects of the motor fuel dealer's violation or the distributor, supplier, wholesaler, or jobber's violation of the provisions of Section 3, 3A, 3B, 4, 5, or 5A of this Act, including declaratory judgment, permanent injunctive relief, and temporary injunctive relief. In addition, the court shall award to the motor fuel user who prevails in an action brought hereunder court costs and attorney's fees that are reasonable in relation to the amount of work expended.

     (c) In addition to the remedies provided in Subsection (b) of this section, if the trier of fact finds that a violation of Section 3, 4, or 5 of this Act was committed wilfully or knowingly by the defendant, the trier of fact shall award not more than three times the amount of actual damages.

     (d) A violation of Section 3, 3A, 3B, 4, 5, or 5A of this Act is also a deceptive trade practice under Subchapter E, Chapter 17, Business & Commerce Code.

     (e) Any action alleging a violation of Section 3, 3A, 3B, 4, 5, or 5A of this Act shall be commenced and prosecuted within two years after the date the cause of action accrued.

Civil Penalty

     Sec. 7. A motor fuel dealer or a distributor, supplier, wholesaler, or jobber of motor fuel who violates a provision of Section 3, 3A, 3B, 4, 5, or 5A of this Act forfeits to the state a civil penalty of not less than $200 nor more than $10,000 .

Administrative Penalty

     Sec. 7A. (a) The commissioner of agriculture may impose an administrative penalty against a person licensed or regulated under this Act who violates this Act or a rule or order adopted under this Act.

     (b) The penalty for a violation may be in an amount not to exceed $500. Each day a violation continues or occurs is a separate violation for purposes of imposing a penalty.

     (c) The amount of the penalty shall be based on:

     (1) the seriousness of the violation, including the nature, circumstances, extent, and gravity of any prohibited acts, and the hazard or potential hazard created to the health, safety, or economic welfare of the public;

     (2) the economic harm to property or the environment caused by the violation;

     (3) the history of previous violations;

     (4) the amount necessary to deter future violations;

     (5) efforts to correct the violation; and

     (6) any other matter that justice may require.

     (d) An employee of the Department of Agriculture designated by the commissioner of agriculture to act under this section who determines that a violation has occurred may issue to the commissioner of agriculture a report that states the facts on which the determination is based and the designated employee's recommendation on the imposition of a penalty, including a recommendation on the amount of the penalty.

     (e) Within 14 days after the date the report is issued, the designated employee shall give written notice of the report to the person. The notice may be given by certified mail. The notice must include a brief summary of the alleged violation and a statement of the amount of the recommended penalty and must inform the person that the person has a right to a hearing on the occurrence of the violation, the amount of the penalty, or both the occurrence of the violation and the amount of the penalty.

     (f) Within 20 days after the date the person receives the notice, the person in writing may accept the determination and recommended penalty of the designated employee or may make a written request for a hearing on the occurrence of the violation, the amount of the penalty, or both the occurrence of the violation and the amount of the penalty.

     (g) If the person accepts the determination and recommended penalty of the designated employee, the commissioner of agriculture by order shall approve the determination and impose the recommended penalty.

     (h) If the person requests a hearing or fails to respond timely to the notice, the designated employee shall set a hearing and give notice of the hearing to the person. The hearing shall be held by an administrative law judge of the State Office of Administrative Hearings. The administrative law judge shall make findings of fact and conclusions of law and promptly issue to the commissioner of agriculture a proposal for a decision about the occurrence of the violation and the amount of a proposed penalty. Based on the findings of fact, conclusions of law, and proposal for a decision, the commissioner of agriculture by order may find that a violation has occurred and impose a penalty or may find that no violation occurred.

     (i) The notice of the commissioner of agriculture's order given to the person under Chapter 2001, Government Code, must include a statement of the right of the person to judicial review of the order.

     (j) Within 30 days after the date the commissioner of agriculture's order becomes final as provided by Section 2001.144, Government Code, the person shall:

     (1) pay the amount of the penalty;

     (2) pay the amount of the penalty and file a petition for judicial review contesting the occurrence of the violation, the amount of the penalty, or both the occurrence of the violation and the amount of the penalty; or

     (3) without paying the amount of the penalty, file a petition for judicial review contesting the occurrence of the violation, the amount of the penalty, or both the occurrence of the violation and the amount of the penalty.

     (k) Within the 30-day period, a person who acts under Subsection (j)(3) of this section may:

     (1) stay enforcement of the penalty by:

     (A) paying the amount of the penalty to the court for placement in an escrow account; or

     (B) giving to the court a supersedeas bond that is approved by the court for the amount of the penalty and that is effective until all judicial review of the commissioner of agriculture's order is final; or

     (2) request the court to stay enforcement of the penalty by:

     (A) filing with the court a sworn affidavit of the person stating that the person is financially unable to pay the amount of the penalty and is financially unable to give the supersedeas bond; and

     (B) giving a copy of the affidavit to the designated employee by certified mail.

     (l) A designated employee who receives a copy of an affidavit under Subsection (k)(2) of this section may file with the court, within five days after the date the copy is received, a contest to the affidavit. The court shall hold a hearing on the facts alleged in the affidavit as soon as practicable and shall stay the enforcement of the penalty on finding that the alleged facts are true. The person who files an affidavit has the burden of proving that the person is financially unable to pay the amount of the penalty and to give a supersedeas bond.

     (m) If the person does not pay the amount of the penalty and the enforcement of the penalty is not stayed, the designated employee may refer the matter to the attorney general for collection of the amount of the penalty.

     (n) Judicial review of the order of the commissioner of agriculture:

     (1) is instituted by filing a petition as provided by Subchapter G, Chapter 2001, Government Code; and

     (2) is under the substantial evidence rule.

     (o) If the court sustains the occurrence of the violation, the court may uphold or reduce the amount of the penalty and order the person to pay the full or reduced amount of the penalty. If the court does not sustain the occurrence of the violation, the court shall order that no penalty is owed.

     (p) When the judgment of the court becomes final, the court shall proceed under this subsection. If the person paid the amount of the penalty and if that amount is reduced or is not upheld by the court, the court shall order that the appropriate amount plus accrued interest be remitted to the person. The rate of the interest is the rate charged on loans to depository institutions by the New York Federal Reserve Bank, and the interest shall be paid for the period beginning on the date the penalty was paid and ending on the date the penalty is remitted. If the person gave a supersedeas bond and if the amount of the penalty is not upheld by the court, the court shall order the release of the bond. If the person gave a supersedeas bond and if the amount of the penalty is reduced, the court shall order the release of the bond after the person pays the amount.

     (q) A penalty collected under this section shall be remitted to the comptroller for deposit in the general revenue fund.

     (r) All proceedings under this section are subject to Chapter 2001, Government Code, except as provided by Subsections (s) and (t) of this section.

     (s) Notwithstanding Section 2001.058, Government Code, the commissioner of agriculture may change a finding of fact or conclusion of law made by the administrative law judge if the commissioner of agriculture:

     (1) determines that the administrative law judge:

     (A) did not properly apply or interpret applicable law, department rules or policies, or prior administrative decisions; or

     (B) issued a finding of fact that is not supported by a preponderance of the evidence; or

     (2) determines that a department policy or a prior administrative decision on which the administrative law judge relied is incorrect or should be changed.

     (t) The commissioner of agriculture shall state in writing the specific reason and legal basis for a determination under Subsection (s) of this section.

Criminal offenses and penalties

     Sec. 8. (a) A person commits an offense if the person intentionally or knowingly violates Section 3, 3A, 3B, 4, 5, or 5A of this Act or any rule of the commissioner of agriculture prescribed to enforce or implement those sections of this Act.

     (b) A person commits an offense if the person intentionally or knowingly:

     (1) refuses to permit a person authorized by Section 2 of this Act to test any motor fuel sold or held for sale in this state;

     (2) refuses to permit inspection of any document required to be kept or delivered by this Act upon request of a person authorized to inspect such documents by Section 5 or 5A of this Act; or

     (3) mutilates, destroys, secretes, forges, or falsifies any document, record, report, or sign required to be delivered, kept, filed, or posted by this Act or any rule prescribed by the commissioner of agriculture for the enforcement of this Act.

     (c) An offense under Subsection (a) of this section is a Class C misdemeanor.

     (d) An offense under Subsection (b) of this section is a Class B misdemeanor.

     (e) The commissioner of agriculture or the authorized representative of the commissioner may request the appropriate prosecuting attorney to prosecute a violation of a provision of this Act.

Rules and fees

     Sec. 9. (a) The commissioner of agriculture may adopt rules not inconsistent with this Act for the regulation of the sale of motor fuels containing ethanol and methanol.

     (b) The comptroller by rule may impose fees for testing, inspection, statement or record forms, sale of signs, or the performance of other services provided as determined necessary by the commissioner of agriculture in the administration of this Act.

     (c) In addition to the fees authorized by Subsection (b) of this section, the comptroller by rule may impose a fee to be collected on a periodic basis determined by the comptroller from each distributor, supplier, wholesaler, and jobber who deals in a motor fuel, without regard to whether the motor fuel is subject to regulation under this Act, as determined necessary by the commissioner of agriculture. The comptroller by rule shall prescribe the form for reporting and remitting the fees imposed by and under this section.

     (d) The fees and penalties imposed by this Act or by a rule of the comptroller made pursuant to this Act shall be subject to the provisions of Chapter 111 and Sections 153.006, 153.007, and 153.401, Tax Code, except to the extent those sections are in conflict with this Act.

     (e) The total amount of the fees collected annually under this Act may not exceed the lesser of:

     (1) the costs of administering and enforcing the provisions of this Act as determined necessary by the commissioner of agriculture; or

     (2) $500,000.

     (f) The fees collected under this section may be used only:

     (1) by the comptroller to defray the cost of collecting the fees and penalties imposed by this Act but may not exceed $25,000 annually; or

     (2) by the commissioner of agriculture for the administration and enforcement of this Act.

Contracting for Enforcement

     Sec. 10. The commissioner of agriculture may contract for the enforcement of this Act after due notice.

Delivery of Documents to Federal Government

     Sec. 11. The commissioner of agriculture, an authorized representative of the commissioner, or the attorney general may make a copy of any manifest, bill of sale, bill of lading, delivery ticket, letter of certification, or other document the commissioner or attorney general is entitled to inspect under this Act. The commissioner, an authorized representative of the commissioner, or the attorney general may deliver the copy of a document described by this section to the federal government for purposes of prosecuting persons for violations of federal law relating to the sale or transfer of motor fuel.

Acts 1989, 71st Leg., ch. 1033, eff. Jan. 1, 1990. Sec. 1(2) amended by Acts 1993, 73rd Leg., ch. 979, § 2, eff. Aug. 30, 1993; Sec. 9(c), (e) amended by Acts 1993, 73rd Leg., ch. 979, § 1; Sec. 1 amended by Acts 1997, 75th Leg., ch. 1036, § 1, eff. Sept. 1, 1997; Sec. 2 amended by Acts 1997, 75th Leg., ch. 1036, § 2, eff. Sept. 1, 1997; Sec. 3A, 3B added by Acts 1997, 75th Leg., ch. 1036, § 3, eff. Sept. 1, 1997; Sec. 4 (c), (d), (e) amended by Acts 1997, 75th Leg., ch. 1036, § 4, eff. Sept. 1, 1997; Sec. 5 amended by Acts 1997, 75th Leg., ch. 1036, § 5, eff. Sept. 1, 1997; Sec. 5A added by Acts 1997, 75th Leg., ch. 1036, § 6, eff. Sept. 1, 1997; Sec. 6 amended by Acts 1997, 75th Leg., ch. 1036, § 7, eff. Sept. 1, 1997; Sec. 7 amended by Acts 1997, 75th Leg., ch. 1036, § 8, eff. Sept. 1, 1997; Sec. 7A added by Acts 1997, 75th Leg., ch. 1036, § 9, eff. Sept. 1, 1997; Sec. 8 (a), (b), (e) amended by Acts 1997, 75th Leg., ch. 1036, § 10, eff. Sept. 1, 1997; Sec. 9 (a), (b), (c), (e), (f) amended by Acts 1997, 75th Leg., ch. 1036, § 11, eff. Sept. 1, 1997; Sec. 10 amended by Acts 1997, 75th Leg., ch. 1036, § 12, eff. Sept. 1, 1997; Sec. 11 added by Acts 1997, 75th Leg., ch. 1036, § 13, eff. Sept. 1, 1997.

CHAPTER FIVE—COMMODITY EXCHANGES

Art. 8651. Definitions

     That for the purpose of this Act, the term "Contract of Sale" shall be held to include sales, purchases, agreements of sale, agreements to sell, and agreements to purchase; that the word "person" wherever used in this Act shall be construed to import the plural or singular as the case demands, and shall include individuals, associations, partnerships, and corporations.

Acts 1925, 39th Leg., p. 38, ch. 15, § 1.

Art. 8652. Future contracts valid

     All contracts of sale for future delivery of cotton, grain, stocks, or other commodities, (1) made in accordance with the rules of any board of trade, exchange, or similar institution, and (2) actually executed on the floor of such board of trade, exchange, or similar institution, and performed or discharged according to the rules thereof, and (3) when such contracts of sale are placed with or through a regular member in good standing of a cotton exchange, grain exchange, board of trade, or similar institution, organized under the laws of the State of Texas or any other State, shall be and they hereby are declared to be valid and enforceable in the courts of this State, according to their terms; provided, that contracts of sale for future delivery of cotton in order to be valid and enforceable as provided herein, must not only conform to the requirements of clauses 1 and 2 of this section, but must also be made subject to the provisions of the United States Cotton Futures Act, approved August 11, 1916, and any amendments thereto; provided, further, that if this clause should for any reason be held inoperative, then contracts for the future delivery of cotton shall be valid and enforceable if they conform to the requirements of clauses 1 and 2 of this section; provided further, that all contracts as defined in Section 1 hereof where it is not contemplated by the parties thereto that there shall be an actual delivery of the commodities sold or bought shall be unlawful.

Acts 1925, 39th Leg., p. 38, ch. 15, § 2.

Art. 8653. Future contracts invalid

     Any contract of sale for future delivery of cotton, grain, stocks, or other commodities where it is not the bona fide intention of parties that the things mentioned therein are to be delivered but which is to be settled according to or upon the basis of the public market quotations or prices made on any board of trade, exchange, or other similar institution, without any actual bona fide execution and the carrying out of such contract upon the floor of such exchange, board of trade or similar institution, in accordance with the rules thereof, shall be null and void and unenforceable in any court of this State, and no action shall be maintainable thereon at the suit of any party.

Acts 1925, 39th Leg., p. 38, ch. 15, § 3.

Art. 8654. Bucket shop defined and prohibited

     A bucket shop is hereby defined to be and mean any place of business wherein are made contracts of the sort or character denounced by the preceding Section 3 of this Act, and the maintenance or operation of a bucket shop at any point in this State is prohibited.

Acts 1925, 39th Leg., p. 38, ch. 15, § 4.

Art. 8655. Shall furnish copy of contract

     Every person shall furnish upon demand to any principal for whom such person has executed any contract for the future delivery of any cotton, grain, stocks, or other commodities, a written instrument setting forth the name and location of the exchange, board of trade, or similar institution, upon which such contract has been executed, the date of the execution, of the contract, and the name and address of the person with whom such contract was executed, and if such person shall refuse or neglect to furnish such statement upon reasonable demand, such refusal or neglect shall be prima facie evidence that such contract was an illegal contract within the provisions of Art. 658, and that the person who executed it was engaged in the maintenance and operation of a bucket shop, within the provisions of Article 661 hereof.

Acts 1925, 39th Leg., p. 38, ch. 15, § 5.

Art. 8656. Penalty

     Any person, either as agent or principal, who enters into or assists in making any contracts of sale of the sort or character denounced in the preceding Art. 658 for the future delivery of cotton, grain, stocks, or other commodities, or who maintain a bucket shop, as that term is defined in Art. 659, shall be guilty of a felony, and upon conviction, shall be imprisoned in the penitentiary not exceeding two years.

Acts 1925, 39th Leg., p. 38, ch. 15, § 6.

Art. 8657. Permitting exchanges

     There may be organized in any city, town, or municipality in the State of Texas, voluntary associations to be known as cotton exchanges, grain exchanges, boards of trade, or similar institutions, to receive and post quotations on cotton, grain, stocks, or other commodities, for the benefit of its members and other persons engaged in the production of cotton, grain, or other commodities. Such associations shall be composed of members and shall adopt a uniform set of rules and regulations not incompatible with the laws of Texas and of the United States. They shall open their books to inspection of all proper courts and officers when required so to do.

Acts 1925, 39th Leg., p. 38, ch. 15, § 7.

Art. 8658. Repealer

     Articles 536 and 537 of Chapter 2, Title 11, and Articles 538 to 547 inclusive of Chapter 3, Title 11, of the Revised Penal Code of the State of Texas, of 1911, and all laws and parts of laws regulating or prohibiting dealings in future contracts, or in conflict or inconsistent herewith, be and the same are hereby repealed.

Acts 1925, 39th Leg., p. 38, ch. 15, § 8.

Art. 8659. Severability

     If any clause, sentence, paragraph, or part of this Act shall for any reason be adjudged by any court of competent jurisdiction to be invalid, such judgment shall not effect, impair, or invalidate the remainder thereof, but shall be confined in its operation to the clause, sentence, or paragraph or part thereof directly involved in the controversy in which such judgment shall have been rendered; and any contract valid under and satisfying the remaining clauses, sentences, paragraphs, or parts of this Act shall be valid and enforceable in the courts of this State.

Acts 1925, 39th Leg., p. 38, ch. 15, § 9.

CHAPTER TEN—AIR CONDITIONING AND REFRIGERATION CONTRACTORS

Art. 8861. Air Conditioning and Refrigeration Contractor License Law

Short Title

     Sec. 1. This Act may be cited as the "Air Conditioning and Refrigeration Contractor License Law."

Definitions

     Sec. 2. In this Act:

     (1) "Environmental air conditioning" means the process of treating air to control temperature, humidity, cleanliness, ventilation, and circulation to meet human comfort requirements.

     (2) "Air conditioning and refrigeration contractor" means a person who performs air conditioning and refrigeration contracting.

     (3) "Commercial refrigeration" means the use of mechanical or absorption equipment to control temperature, humidity, or both in order to satisfy the intended use of a specific space.

     (4) "Process cooling or heating" includes the control of temperature, humidity, or cleanliness solely for proper operation of equipment or for production requirements.

     (5) "Commissioner" means the commissioner of licensing and regulation.

     (6) "Person" means an individual.

     (7) "Air conditioning and refrigeration maintenance work" means repair work and all other work required for the continued normal performance of an environmental air conditioning system, commercial refrigeration system or equipment, or process cooling or heating system. The term does not include the installation of a total replacement of the system or the installation or repair of boilers or pressure vessels that must be installed pursuant to rules and regulations adopted by the commissioner under Chapter 755, Health and Safety Code.

     (8) "Advisory board" means the Air Conditioning and Refrigeration Contractors Advisory Board.

     (9) "Air conditioning and refrigeration contracting" means to perform or offer to perform the design, installation, construction, maintenance, service, repair, alteration, or modification of a product or of equipment in environmental air conditioning, commercial refrigeration, or process cooling or heating systems.

     (10) "Mechanical integrity" means physical installation of products, systems, or equipment in accordance with their intended purpose and according to:

     (A) standards at least as strict as the standards set forth in the Uniform Mechanical Code published jointly by the International Conference of Building Officials and the International Association of Plumbing and Mechanical Officials, or their successor organizations, or the Standard Mechanical Code published by the Southern Building Code Congress International, Inc., or its successor organization;

     (B) all other applicable codes; and

     (C) the manufacturer's specifications.

     (11) "Cooling capacity" means the nominal tonnage of the compression equipment based on 40 degrees Fahrenheit suction temperature and 105 degrees Fahrenheit condensing temperature.

     (12) "Department" means the Texas Department of Licensing and Regulation.

     (13) "Commission" means the Texas Commission of Licensing and Regulation.

     (14) "Air conditioning and refrigeration contracting company" means any person, sole proprietorship, corporation, partnership, association, or other business entity that performs or offers to perform air conditioning and refrigeration contracting to the general public.

Powers and Duties of Commissioner

     Sec. 3. (a) The commissioner shall adopt rules for the practice of air conditioning and refrigeration contracting consistent with this Act. The standards prescribed by rule must be at least as strict as the standards set forth in the Uniform Mechanical Code published jointly by the International Conference of Building Officials and the International Association of Plumbing and Mechanical Officials or the Standard Mechanical Code published by the Southern Building Code Congress International, Inc., as those codes exist at the time the rules are adopted. The commissioner shall enforce this Act and may adopt rules relating to enforcement requirements.

     (b) The executive director may issue an emergency order as necessary to enforce this Act if the executive director determines that an emergency exists requiring immediate action to protect the public health and safety. The order may be issued without notice and hearing or with any notice and hearing that the executive director considers practicable under the circumstances. If an emergency order is issued under this subsection without a hearing, the executive director shall set the time and place for a hearing to affirm, modify, or set aside the emergency order. The executive director may issue cease and desist orders.

     (c) Repealed by Acts 1989, 71st Leg., ch. 1039, § 5.01(16), eff. Sept. 1, 1989.

     (d) The commissioner shall prescribe application forms for original and renewal licenses and the design of the licenses.

     (e) The commissioner shall prescribe the method and content of examinations administered under this Act and shall set compliance requirements for the examinations. The examinations shall be offered at locations within the state determined by the commissioner and shall be offered on a monthly basis or more frequently as determined by the commissioner. The examination may be offered by computer at locations within the state determined by the commissioner.

     (f) The commissioner shall set insurance requirements for persons licensed under this Act. The commissioner may waive the insurance requirements for licensees who do not contract with the general public.

     (g) The department may employ the personnel necessary to implement this Act. The department shall employ at least two full-time air conditioning and refrigeration contractors to serve as examiners.

     (h) The commissioner may authorize necessary disbursements to implement this Act, including office expenses, costs of equipment, and other necessary facilities.

     (i) Repealed by Acts 1989, 71st Leg., ch. 1039, § 5.01(16), eff. Sept. 1, 1989.

     (j) The commissioner shall maintain a record of his proceedings under this Act.

     (k) The department shall publish annually a directory of the persons licensed under this Act. The department may sell the directory on payment of a reasonable fee set by the commission. The fees collected under this subsection shall be appropriated to the department for use in the administration of this Act.

     (l) The department may contract with another state agency or a political subdivision of the state for the enforcement of this Act and the rules adopted by the commissioner under this Act.

     (m) A representative of the department or a municipal air conditioning or refrigeration inspector within the jurisdiction of the municipality may issue a citation to a person who violates Section 10(e) or (f) of this Act.

Advisory board

     Sec. 3A. (a) The Air Conditioning and Refrigeration Contractors Advisory Board is created to advise the commissioner in adopting rules and enforcing and administering this Act and to advise the commission in setting fees.

     (b) The advisory board is composed of six members appointed by the governor with the advice and consent of the senate who are experienced in the design, installation, construction, maintenance, service, repair, alteration, or modification of equipment used for environmental air conditioning, commercial refrigeration, or process cooling or heating. A member of the advisory board serves a term of six years, with terms expiring on February 1 of odd-numbered years.

     (c) The governor shall appoint the advisory board members as follows:

     (1) one member must be an official of a municipality with a population of not more than 250,000;

     (2) one member must be an official of a municipality with a population greater than 250,000;

     (3) four members must be full-time licensed air conditioning and refrigeration contractors, as follows:

     (A) one member must hold a Class A license and must practice in a municipality with a population greater than 250,000;

     (B) one member must hold a Class B license and must practice in a municipality with a population greater than 250,000;

     (C) one member must hold a Class A license and must practice in a municipality with a population greater than 25,000 but not more than 250,000; and

     (D) one member must hold a Class B license and must practice in a municipality with a population of not more than 25,000;

     (d) For the purposes of Subsection (c) of this section, "population" means population according to the most recent federal decennial census.

     (e) The governor shall designate one member of the board to serve as chairman. The commissioner and the chief administrator of this Act serve as ex officio, nonvoting members of the advisory board. On the resignation, death, suspension, or incapacity of any member, the governor shall fill the vacancy for the remainder of the unexpired term with an individual who represents the same interests with which the predecessor was identified.

     (f) In appointing the air conditioning and refrigeration contractor members of the advisory board, at least one of those appointees should be an air conditioning and refrigeration contractor who employs organized labor, and at least two of those appointees should be registered professional engineers.

     (g) The advisory board shall meet at least every six months and may meet at other times at the call of the chairman. The advisory board shall meet at a place designated by the board within the State of Texas. A decision of the advisory board is not effective unless it receives the affirmative vote of at least four members.

     (h) The advisory board members serve without compensation. A member is entitled to reimbursement for actual and necessary expenses incurred in performing functions as a member of the advisory board, subject to any applicable limitation on reimbursement provided by the General Appropriations Act.

License Required; Citation

     Sec. 3B. (a) Unless the person is exempted under Section 6 of this Act, a person may not perform air conditioning and refrigeration contracting without a license under this Act.

     (b) An air conditioning and refrigeration contracting company must employ full time in each permanent office a license holder whose license is assigned to that company.

     (c) A municipal or county official may issue a citation to an air conditioning and refrigeration contracting company that performs air conditioning and refrigeration contracting without a license issued under this Act, if the person is not exempt from the provisions of this Act.

Enforcement of Contracts

     Sec. 3C. An air conditioning and refrigeration contracting company that performs air conditioning and refrigeration contracting without employing a licensee with the appropriate license under this Act may not collect a fee or otherwise enforce a contract for the services performed. To enforce a contract for the performance of air conditioning and refrigeration contracting, the air conditioning and refrigeration contracting company that performs the services must have been licensed at the time the contract is signed and at the time the work is performed.

Air conditioning and refrigeration contractor licenses

     Sec. 4. (a) Air conditioning and refrigeration contractor licenses are of two classes:

     (1) a Class A license entitles the licensee to perform air conditioning and refrigeration contracting, of each type for which the license is endorsed, on systems, products, or equipment of any size or capacity; and

     (2) a Class B license entitles the licensee to perform air conditioning and refrigeration contracting, of each type for which the license is endorsed, on systems, products, or equipment of not more than 25 tons cooling capacity or of not more than 1.5 million British thermal units per hour output heating capacity.

     (b) Endorsements are of two types:

     (1) an environmental air conditioning endorsement entitles the licensee to perform air conditioning and refrigeration contracting in relation to environmental air conditioning within the class of license held; and

     (2) a commercial refrigeration and process cooling and heating endorsement entitles the licensee to perform air conditioning and refrigeration contracting in relation to commercial refrigeration and process cooling and heating within the class of license held.

     (c) Each license shall be endorsed for either environmental air conditioning or commercial refrigeration and process cooling and heating, or both. For each endorsement the licensee must perform satisfactorily on a separate examination related to the endorsement. A licensee may not perform under a state license air conditioning and refrigeration contracting of a type for which the person's license is not endorsed.

     (d) The commissioner shall prescribe separate examinations for each class of license and, within each class, separate examinations for environmental air conditioning and for commercial refrigeration and process cooling and heating.

     (e) An applicant for an air conditioning and refrigeration contractor license must be at least 18 years old and must present to the commissioner satisfactory evidence of at least 36 months of practical experience with the tools of the trade in the preceding five years. For purposes of the experience requirement, a degree or diploma in air conditioning engineering, refrigeration engineering, or mechanical engineering from an institution of higher education whose program is approved by the Texas State Board of Registration for Professional Engineers for the purpose of licensing professional engineers is considered the equivalent of two years of practical experience.

     (f) The application must be made on a form prescribed by the commissioner and must specify the class of license and each endorsement the applicant seeks. The application must be verified and must be accompanied by:

     (1) a statement of the applicant's practical experience; and

     (2) the examination fee.

     (g) The executive director shall issue an air conditioning and refrigeration contractor license to an applicant who possesses the required qualifications, passes the appropriate examinations, furnishes evidence of the insurance coverage required under this Act, and pays the original license fee required by this Act. An applicant who fails an examination is eligible for reexamination.

     (h) A license issued under this Act expires at the end of the license period set by the commission.

     (i) With the advice of the advisory board, the commissioner shall adopt rules relating to the use, display, and advertisement of a licensee's license.

Notice of examination results

     Sec. 4A. (a) Not later than the 30th day after the date on which an examination is administered under this Act, the commissioner shall notify each examinee of the results of the examination. However, if an examination is graded or reviewed by a national testing service, the commissioner shall notify examinees of the results of the examination not later than the 14th day after the date on which the commissioner receives the results from the testing service. If the notice of examination results graded or reviewed by a national testing service will be delayed for longer than 90 days after the examination date, the commissioner shall notify the examinee of the reason for the delay before the 90th day.

     (b) If requested in writing by a person who fails the examination, the commissioner shall furnish the person with an analysis of the person's performance on the examination.

Continuing education programs

     Sec. 4B. The commissioner may recognize, prepare, or administer continuing education programs for licensees. Participation in the programs is voluntary.

License by reciprocity

     Sec. 4C. The commissioner may waive any license requirement for an applicant with a valid license from another state with which this state has a reciprocity agreement.

Temporary license

     Sec. 4D. (a) The commissioner, by rule, may provide for the issuance of a temporary license to perform air conditioning and refrigeration contracting.

     (b) The commissioner may issue a temporary license to an applicant who applies to the commissioner on a form prescribed by the commissioner and pays the required fees.

Violations of Act; denial, suspension or revocation of license

     Sec. 5. (a) A violation of this Act or a rule adopted under this Act is a ground for the denial, suspension, or revocation of a license issued under this Act. The failure to provide proper installation, service, or mechanical integrity under this Act constitutes a violation of this Act. An intentional or knowing misrepresentation of necessary services, services to be provided, or services that have been provided, or a fraudulent promise made to influence, persuade, or induce an individual to contract for services constitutes a violation of this Act and a ground for the suspension or revocation of a license issued under this Act.

     (b) Proceedings for the denial, suspension, or revocation of a license and appeals from those proceedings are governed by the Administrative Procedure and Texas Register Act, as amended (Article 6252–13a, Vernon's Texas Civil Statutes).

Consumer complaint investigation

     Sec. 5A. (a) The commissioner shall prepare information of consumer interest describing the functions performed by the commissioner under this Act and the rights of consumers as affected by this Act. The information must describe the procedure by which a consumer complaint is filed with and resolved by the commissioner. The commissioner shall make the information available to the general public.

     (b) The commissioner shall investigate consumer complaints filed with the commissioner. If the commissioner determines after investigation that a licensee has violated this Act or a rule adopted under this Act, the commissioner may take appropriate action under Section 5 of this Act.

Exemptions; restrictions

     Sec. 6. (a) Except as provided by Section 10 of this Act, this Act does not apply to a person who:

     (1) performs air conditioning and refrigeration contracting in a building owned solely by the person as the person's home;

     (2) performs air conditioning or refrigeration maintenance work if (i) the person is a maintenance person or maintenance engineer who is a regular bona fide employee of the property owner, the property lessee, or the management company managing the property where the maintenance work is being performed, (ii) the work is performed in connection with the business in which the person is employed, and (iii) the person and the person's employer referred to in (i) above do not engage in the occupation of air conditioning and refrigeration contracting for the general public;

     (3) performs air conditioning and refrigeration contracting and is regularly employed by a regulated electric or gas utility;

     (4) is licensed as a professional engineer under The Texas Engineering Practice Act (Article 3271a, Vernon's Texas Civil Statutes), performs work in connection with the business in which the person is employed, and does not engage in the practice of air conditioning and refrigeration contracting for the general public;

     (5) performs process cooling or heating work for an industrial operation such as a chemical plant, petrochemical plant, refinery, natural gas plant, or natural gas treating plant when employed by that operation;

     (6) performs air conditioning and refrigeration contracting on:

     (A) a portable or self-contained ductless air conditioning product that has a cooling capacity of three tons or less;

     (B) a portable or self-contained heating product that does not require the forced movement of air outside the heating unit;

     (C) environmental air conditioning equipment that is intended for temporary use and is not fixed in place; or

     (D) residential refrigerators, freezers, and ice machines; or

     (7) performs air conditioning services only on a motor vehicle or MVAC-like appliance air conditioner or who employs a person who performs air conditioning services only on a motor vehicle or MVAC-like appliance air conditioner. For the purposes of this article, "MVAC-like appliance" has the meaning as that term is defined in 40 C.F.R. Section 82.152.

     (b) The work described by Subsection (a) of this section remains subject to any permit, inspection, or approval requirements prescribed by a municipal ordinance.

     (c) A person licensed under this Act may not perform or offer or attempt to perform any act, service, or function that is defined as the practice of engineering by The Texas Engineering Practice Act, as amended (Article 3271a, Vernon's Texas Civil Statutes).

     (d) A person licensed under this Act may not perform or offer or attempt to perform any act, service, or function regulated under Chapter 113, Natural Resources Code, unless licensed or exempted by rule under that law. A person regulated under Chapter 113, Natural Resources Code, may not perform or offer or attempt to perform air conditioning or refrigeration contracting unless licensed under this Act.

     (e) A person licensed under this Act may not perform or offer or attempt to perform any act, service, or function that is defined as plumbing work under The Plumbing License Law (Article 6243–101, Vernon's Texas Civil Statutes) unless licensed under that law. A person who is licensed in this state as a plumber and is engaged in business as a plumber may not perform or offer or attempt to perform air conditioning and refrigeration contracting unless licensed under this Act.

     (f) This article does not apply to a person or firm that is licensed as a manufacturer, retailer, rebuilder, or installer and regulated pursuant to the Texas Manufactured Housing Standards Act (Article 5221f, Vernon's Texas Civil Statutes) and that engages exclusively in air conditioning and refrigeration contracting for manufactured homes provided that the installation of air conditioning components at the site where the home will be occupied is performed by a person licensed under this Act.

     (g) A person who assists in the performance of air conditioning and refrigeration contracting work under the supervision of a licensee is not required to be licensed.

     (h) This Act does not apply to a person who installs, repairs, or removes a vent hood of the type commonly used in residential and commercial kitchens.

Reporting Requirement

     Sec. 7. (a) Each person licensed under this Act shall notify the municipal authority who has control of the enforcement of regulations relative to air conditioning and refrigeration contracting in the municipality in which the person is engaged in air conditioning and refrigeration contracting that the person has obtained a state license.

     (b) The notification must be in the form required by the municipality.

     (c) The amount of a fee imposed by a municipality on a contractor to provide notice under this section may be set by the municipality only in an amount reasonable and necessary to implement this section.

Penalty

     Sec. 8. Except as provided in Section 9, a person commits an offense if the person knowingly or intentionally engages in air conditioning and refrigeration contracting without a license issued under this Act. An offense under this section is a Class C misdemeanor.

Municipal Regulation

     Sec. 9. (a) A license issued by a municipality of this state that complies with the requirements of this section is valid under the terms of the license within that municipality. However, a license issued by the department is valid throughout the state, and the holder and people under supervision are not required to hold a municipal license to practice air conditioning and refrigeration contracting in any municipality within this state.

     (b) An applicant for a municipal license must:

     (1) pass an examination that covers the same subjects as the examination required by the commissioner for an air conditioning and refrigeration contractor license of the class of work that the municipal applicant proposes to perform; and

     (2) meet experience requirements that are at least as strict as those required under Section 4(e) of this Act for an air conditioning and refrigeration contractor license.

     (c) A municipality may by ordinance adopt and enforce standards for air conditioning and refrigeration contractors that are consistent with the standards established under this Act. The municipality shall report violations of the ordinance to the commissioner not later than the 10th day after the date on which the municipality takes action to enforce the ordinance. Conviction of an offense under the municipal ordinance is a ground for the denial, suspension, or revocation of a license issued under this Act.

Sale and Use of Refrigerants

     Sec. 10. (a) In this section, "refrigerant" means a class I or class II substance, as listed in Section 602, Clean Air Act Amendments of 1990 (42 U.S.C. Section 7671a), and federal administrative rules adopted under that section.

     (b) Each person who purchases, sells, or uses a refrigerant in this state shall comply with the requirements of the federal Clean Air Act and the federal administrative rules adopted under that Act. Consistent with that requirement, the department shall regulate the use and sale of refrigerants as provided by this section.

     (c) A person may not sell a flammable refrigerant or refrigerant substitute that contains a liquid petroleum-based product for use in an automotive, aviation, commercial, or residential air conditioning or refrigeration system. A flammable refrigerant or refrigerant substitute that contains a liquid petroleum-based product may not be used in the maintenance or installation of any system relating to an airplane or other aircraft.

     (d) To purchase a refrigerant, a person whose use is exempt under Section 6(a)(2) or 6(a)(4) of this Act must obtain a certificate of registration from the department and must present to the seller evidence of compliance with the registration requirement. The commissioner by rule shall adopt requirements governing the registration and the issuance of certificates of registration.

     (e) Except as provided by Subsection (g) of this section, a person may purchase refrigerants or equipment containing a refrigerant in this state only if that person:

     (1) is licensed under this Act or a municipal ordinance that complies with Section 9 of this Act; or

     (2) holds a certificate of registration issued by the department under this section.

     (f) The purchaser must provide to the seller evidence of compliance by the purchaser with the license or registration requirements imposed under this Act that apply to the purchaser. The commissioner by rule shall establish requirements for the evidence.

     (g) A purchaser may purchase refrigerants if that person's use is exempt under Section 6(a)(1), (3), (5), (6), or (7) of this Act if the person is authorized to do so under other state or federal law and is not required to provide to a seller evidence of the exemption.

     (h) A person commits an offense if the person purchases a refrigerant or equipment containing a refrigerant in this state in violation of Subsection (c), (e), or (f) of this section. An offense under this subsection is a Class C misdemeanor.

     (i) This section does not apply to a "small appliance" as defined by 40 C.F.R. Part 82.152, as amended.

     (j) This section does not apply to persons exempt under Section 6(a)(3), (5), or (7) of this Act.

     Sec. 11. Repealed by Acts 1987, 70th Leg., ch. 581, § 12, eff. Sept. 1, 1987.

Acts 1983, 68th Leg., p. 3228, ch. 555, §§ 1 to 11, eff. Sept. 1, 1983. Sec. 2(6) added by Acts 1985, 69th Leg., ch. 925, § 1, eff. Aug. 26, 1985; Sec. 6(a) amended by Acts 1985, 69th Leg., ch. 925, § 2, eff. Aug. 26, 1985; Sec. 6(e) added by Acts 1985, 69th Leg., ch. 846, § 13, eff. Sept. 1, 1985; Sec. 9 amended by Acts 1985, 69th Leg., ch. 925, § 3, eff. Aug. 26, 1985; Sec. 1 amended by Acts 1987, 70th Leg., ch. 581, § 1, eff. Sept. 1, 1987; Sec. 2 amended by Acts 1987, 70th Leg., ch. 581, § 2, eff. Sept. 1, 1987; Sec. 3 amended by Acts 1987, 70th Leg., ch. 581, § 3, eff. Sept. 1, 1987; Sec. 3A added by Acts 1987, 70th Leg., ch. 581, § 4, eff. Sept. 1, 1987; Sec. 4 amended by Acts 1987, 70th Leg., ch. 581, § 5, eff. Sept. 1, 1987; Sec. 5(a) amended by Acts 1987, 70th Leg., ch. 581, § 6, eff. Sept. 1, 1987; Sec. 5A added by Acts 1987, 70th Leg., ch. 581, § 7, eff. Sept. 1, 1987; Sec. 6(a), (c) to (e) amended by and subsecs. (f), (g) added by Acts 1987, 70th Leg., ch. 581, § 8, eff. Sept. 1, 1987; Sec. 7 amended by Acts 1987, 70th Leg., ch. 581, § 9, eff. Sept. 1, 1987; Sec. 8 amended by Acts 1987, 70th Leg., ch. 581, § 10, eff. Sept. 1, 1987; Sec. 9 amended by Acts 1987, 70th Leg., ch. 581, § 11, eff. Sept. 1, 1987; Sec. 2(5), (7) amended and (12), (13) added by Acts 1989, 71st Leg., ch. 1039, § 2.70, eff. Sept. 1, 1989; Sec. 3(c) amended by Acts 1989, 71st Leg., ch. 1039, § 5.01(16), eff. Sept. 1, 1989; Sec. 3(g) amended by Acts 1989, 71st Leg., ch. 1039, § 2.71, eff. Sept. 1, 1989; Sec. 3(i) amended by Acts 1989, 71st Leg., ch. 1039, § 5.01(16), eff. Sept. 1, 1989; Sec. 3(k) amended by Acts 1989, 71st Leg., ch. 1039, § 2.71, eff. Sept. 1, 1989; Sec. 3A(a), (h) amended by Acts 1989, 71st Leg., ch. 1039, § 2.72, eff. Sept. 1, 1989; Sec. 4(f) amended by Acts 1989, 71st Leg., ch. 425, § 1, eff. June 14, 1989; Sec. 4(h) amended by Acts 1989, 71st Leg., ch. 1039, § 2.73, eff. Sept. 1, 1989; Secs. 4A to 4D added by Acts 1989, 71st Leg., ch. 1039, § 2.74, eff. Sept. 1, 1989; Sec. 6(d) amended by Acts 1989, 71st Leg., ch. 533, § 8, eff. Sept. 1, 1989; Sec. 10 amended by Acts 1989, 71st Leg., ch. 1039, § 5.01(18), eff. Sept. 1, 1989; Sec. 2(7) amended by Acts 1991, 72nd Leg., ch. 14, § 284(95), eff. Sept. 1, 1991; Sec. 2(7) amended by Acts 1993, 73rd Leg., ch. 117, § 1, eff. Sept. 1, 1993; Sec. 3(l) added by Acts 1993, 73rd Leg., ch. 117, § 2, eff. Sept. 1, 1993; Sec. 3B added by Acts 1993, 73rd Leg., ch. 117, § 3, eff. Sept. 1, 1993; Sec. 6(a), (f), (g) amended by Acts 1993, 73rd Leg., ch. 117, § 4, eff. Sept. 1, 1993; Sec. 3(e) amended by Acts 1997, 75th Leg., ch. 74, § 1, eff. Sept. 1, 1997; Sec. 3(m) added by Acts 1997, 75th Leg., ch. 966, § 1; Sec. 6(f) amended by Acts 1997, 75th Leg., ch. 791, § 18, eff. Sept. 1, 1997; Sec. 10 added by Acts 1997, 75th Leg., ch. 966, § 2, eff. Sept. 1, 1997; Sec. 2(7), (9) amended by Acts 1999, 76th Leg., ch. 849, § 1, eff. Sept. 1, 1999; Sec. 2(14) added by Acts 1999, 76th Leg., ch. 849, § 2, eff. Sept. 1, 1999; Sec. 3(b), (m) amended by Acts 1999, 76th Leg., ch. 849, § 3, eff. Sept. 1, 1999; Sec. 3B amended by Acts 1999, 76th Leg., ch. 849, § 4, eff. Sept. 1, 1999; Sec. 3C added by Acts 1999, 76th Leg., ch. 849, § 5, eff. Sept. 1, 1999; Sec. 4(f), (g) amended by Acts 1999, 76th Leg., ch. 849, § 6, eff. Sept. 1, 1999; Sec. 5(a) amended by Acts 1999, 76th Leg., ch. 849, § 7, eff. Sept. 1, 1999; Sec. 6(a) amended by Acts 1999, 76th Leg., ch. 735, § 1, eff. June 18, 1999; Sec. 6(a) amended by Acts 1999, 76th Leg., ch. 849, § 8, eff. Sept. 1, 1999; Sec. 6(h) added by Acts 1999, 76th Leg., ch. 1407, § 1, eff. June 19, 1999; Sec. 7 amended by Acts 1999, 76th Leg., ch. 849, § 9, eff. Sept. 1, 1999; Sec. 8 amended by Acts 1999, 76th Leg., ch. 849, § 10, eff. Sept. 1, 1999; Sec. 9 amended by Acts 1999, 76th Leg., ch. 849, § 11, eff. Sept. 1, 1999; Sec. 10(g) amended by Acts 1999, 76th Leg., ch. 735, § 2, eff. June 18, 1999; Sec. 10(h) amended by Acts 1999, 76th Leg., ch. 849, § 12, eff. Sept. 1, 1999; Sec. 10(j) added by Acts 1999, 76th Leg., ch. 849, § 13, eff. Sept. 1, 1999.

CHAPTER 15—PROPERTY TAXATION PROFESSIONAL CERTIFICATION

Art. 8885. Property Taxation Professional Certification Act

Purpose of Act

     Sec. 1. The Constitution of Texas requires that taxation be equal and uniform. It provides for taxation in proportion to value. The responsibility for assessing property in compliance with constitutional requirements is that of the tax assessor-collector. The purpose of the legislature by this Act is to assure the people of Texas that the responsibility of assessing property for taxation is entrusted only to those persons duly registered and competent according to the regulations provided by this Act. The legislature further intends that the assessing of property for taxation be practiced and regulated as a learned profession and that the practitioners in this state be accountable to the public.

Definitions

     Sec. 2. In this Act:

     (1) "Appraisal" means those functions described in Chapters 23 and 25, Tax Code, that are performed by employees of political subdivisions or by persons acting on behalf of political subdivisions and that involve an estimate or opinion of value of a property interest.

     (2) "Assessment" means those functions described in Chapter 26, Tax Code, and performed by employees of political subdivisions or by persons acting on behalf of political subdivisions, to determine an amount of ad valorem tax.

     (3) "Board" means the Board of Tax Professional Examiners.

     (4) "Chief appraiser" means the chief administrator of the district appraisal office as defined by Section 6.05, Tax Code.

     (5) "Code of ethics" means a formal statement of ethical standards of conduct adopted by the board.

     (6) "Collections" means those functions described in Chapter 31 and Sections 33.02, 33.03, and 33.04, Tax Code.

     (7) "Governing body" means a county commissioners court, city council, board of trustees, or governmental board of any political subdivision of this state defined as a taxing unit by Section 1.04, Tax Code.

     (8) "Registered professional appraiser" means the highest level of certification established by the board for a person engaged in appraisal.

     (9) "Registered Texas assessor" means the highest level of certification established by the board for a person engaged in assessment.

     (10) "Registered Texas collector" means the highest level of certification established by the board for a person engaged in collections.

     (11) "Tax assessor-collector" means the chief administrator of a taxing unit's tax office who is responsible for the assessing functions described in Chapter 26, Tax Code, and for collection functions described in Chapter 31, Tax Code.

     (12) "Tax collector" means the chief administrator of a taxing unit's tax office who is responsible for collection functions described in Chapter 31, Tax Code, but not for assessing functions.

Short title

     Sec. 3. This Act shall be known as "The Property Taxation Professional Certification Act."

Board of Tax Professional Examiners; qualifications; term of office

     Sec. 4. (a) The Board of Tax Professional Examiners is established.

     (b) The board consists of six members appointed by the governor with the advice and consent of the senate. A vacancy on the board is filled in the same manner for the unexpired portion of the term.

     (c) To be eligible to serve on the board an individual must:

     (1) be a resident of this state;

     (2) be actively engaged in property tax administration;

     (3) have at least five years experience in appraisal, assessment, or collections for property tax purposes; and

     (4) be certified as a registered professional appraiser, registered Texas collector, or registered Texas assessor under this Act.

     (d) Members hold office for terms of six years, with the terms of two members expiring on March 1 of each odd-numbered year.

     (e) The Board of Tax Professional Examiners is subject to Chapter 325, Government Code (Texas Sunset Act). Unless continued in existence as provided by that chapter, the board is abolished and this Act expires September 1, 2003.

Expenses

     Sec. 5. Board members receive no compensation for their services, but each is entitled to be reimbursed for the necessary expenses incurred in the discharge of his duties.

Regular and special meetings; election of officers; quorum

     Sec. 6. (a) The board shall hold at least one regular meeting in each calendar quarter. Special meetings shall be held at such times as are required, according to the bylaws and rules of procedure enacted by the board.

     (b) Members of the board shall receive notice of special meetings at least 15 days in advance of the meeting date.

     (c) The board shall elect annually from its membership a chairman, vice-chairman, and secretary-treasurer. The election of officers shall be held at the first regular meeting of each calendar year. A majority of the members constitutes a quorum.

Rules and regulations

     Sec. 7. The board may make and enforce all rules and regulations necessary for the performance of its duties, establish standards of professional practice, conduct, education, and ethics for appraisers, assessors, and collectors in keeping with the purposes and intent of the Act, and insure strict compliance with and enforce all provisions of this Act.

Receipt and accounting of money; Assessors Registration Fund; record of proceedings; roster of registrants

     Sec. 8. (a) The board shall receive and account for all money derived under the provisions of this Act and shall pay it to the Comptroller. The Comptroller shall designate a separate fund to be known as the "Assessors Registration Fund," which may be used only by the board for the purpose of administering this Act.

     (b) The board shall keep an accurate record of all proceedings, which shall be available to the public at all times. The board shall also maintain a roster of all persons registered with the board, showing their names, places of employment, and classification. Copies of the roster shall be made available to persons registered under this Act and to the public on request.

Executive director; personnel

     Sec. 9. (a) The board shall employ an executive director who shall administer the operations of the board as directed by the board.

     (b) The director may employ other personnel to assist him in the performance of his duties.

Initiation of proceedings; notice; dismissal of complaints without hearing; subpoenas

     Sec. 10. (a) The board may initiate proceedings under this Act, either on its own motion or on the complaint of any person, to insure strict compliance with this Act and all rules adopted by the board. The violation of a provision of this Act or a rule of the board is a sufficient ground to refuse, suspend, or revoke a registration granted under the terms of this Act. The board shall adopt rules for the conduct of proceedings under this section. The rules shall require that written notice be sent by certified mail at least 20 days before a hearing to every party stating the nature of the complaint and the time and place of the hearing before the board.

     (b) The board may dismiss without a hearing a complaint involving a disagreement on the matter of the appraised value of a property and that has not been resolved in the complainant's favor by an appraisal review board or court.

     (c) The board may request and, if necessary, compel by subpoena the attendance of witnesses for examination under oath and the production for inspection and copying of books, accounts, records, papers, correspondence, documents, and other evidence relevant to the investigation of alleged violations of this Act. If a person fails to comply with a subpoena issued under this subsection, the board, acting through the attorney general, may file suit to enforce the subpoena in a district court in Travis County or in the county in which a hearing conducted by the board may be held. The court, if it determines that good cause exists for the issuance of the subpoena, shall order compliance with the requirements of the subpoena. Failure to obey the order of the court may be punished by the court as contempt.

Persons required to register

     Sec. 11. The following persons shall register with the board:

     (1) all chief appraisers, appraisal supervisors and assistants, property tax appraisers, appraisal engineers, and other persons with authority to render judgment on, recommend, or certify appraised values to the appraisal review board of an appraisal district;

     (2) the tax assessor-collector, tax collector, or other person designated by the governing body of a taxing unit as the chief administrator of the unit's assessment functions, collections functions, or both; and other persons who perform assessment or collections functions for the unit whom the chief administrator of the unit's tax office requires to register; and

     (3) all persons engaged in appraisals of real or personal property for ad valorem tax purposes for an appraisal district or a taxing unit.

Exception for officer of populous county

     Sec. 11A. A tax assessor-collector of a county with a population of 1,000,000 or more, according to the most recent federal census, is exempt from Section 11 of this Act.

Exception for Officer Under Interlocal Government Contract

     Sec. 11B. (a) A county tax assessor-collector is exempt from Section 11 of this Act if the county has contracted under Section 6.24(b), Tax Code, to have its taxes assessed and collected by another taxing unit or an appraisal district.

     (b) The exemption under this section exists only while the contract under Section 6.24(b), Tax Code, is in effect.

Identification card

     Sec. 12. While on official duty, persons registered and authorized to engage in appraisal, assessment, or collections shall carry a serially numbered identification card issued by the board stating the expiration date of the registration and describing any classification into which the holder is placed for purposes of registration.

Annual and renewal fees; reinstatement

     Sec. 13. Registrants shall pay to the board an annual fee of not less than $45 and not to exceed $75. The annual registration period expires on December 31 of each year, and registration must be renewed annually. The board shall determine the amount of the renewal fee for each coming year on or before December 1 of each year and mail renewal notices to all persons registered under this Act on or before that date. A person registered under this Act who fails to pay the annual renewal fee on or before January 31 of each year shall be deleted from the list of persons duly registered. Persons applying for reinstatement within 30 days shall pay a penalty, not to exceed $25, set by the board. Reinstatement thereafter may be obtained only by a new application to and examination by the board. The board may not waive the collection of a fee or penalty described under this Act.

Applications for registration; processing fee

     Sec. 14. All applications for registration shall be made on printed forms provided by the board, and applications made otherwise may not be accepted. The board in prescribing the contents of application forms shall ensure that each form requires sufficient information to determine an applicant's proper classification. The form shall be accompanied by the code of ethics. The completed application, including the code of ethics, shall be signed and sworn to before a notary public or other person qualified to administer oaths. Initial application for registration shall be accompanied by a processing fee of $50 which shall be retained by the board without regard to the disposition of the application and the registration fee required by Section 13 of this Act which shall be refunded if the board disapproves the application. The board shall act on all applications within 30 days after they are received by the board. Applicants approved by the board shall be registered and notified of the requirements for professional certification by the board.

Application for Examination; Fee

     Sec. 14A. (a) The board by rule may require a registrant to pass one or more examinations in order to be certified. An applicant for an examination must file an application with the board on a printed form provided by the board. In prescribing the contents of the form, the board shall ensure that the form requires sufficient information to determine the applicant's current classification.

     (b) An application for examination must be accompanied by a fee in an amount set by the board. The board shall retain the fee regardless of whether the applicant passes the examination.

     (c) An application for an examination must be filed with the board not later than the 14th day before the examination date.

Qualifications of applicants

     Sec. 15. An applicant must be at least 18 years of age, a resident of the State of Texas, a person of good moral character and actively engaged in appraisal, assessment, or collection for a taxing unit. The applicant must be a graduate of an accredited high school or establish high school graduation equivalency. When an application is approved, the board shall classify and register the applicant, and inform the applicant of requirements that he must meet to maintain current registration.

Classification system

     Sec. 16. The board by rule shall adopt a classification system for registrants and establish minimum requirements for each classification. Requirements must be based on experience in property taxation administration, education and training, professional performance and achievements, and compliance with the code of ethics.

Requirements for certification

     Sec. 17. (a) The board by rule shall adopt minimum requirements for the certification of registrants. For an employee of a taxing unit's tax office, the requirements for certification shall emphasize, but shall not necessarily be limited to, the areas of responsibility of the registrant in performing his duties for the taxing unit.

     (b) The rules shall require that:

     (1) a person registered as an appraiser attain certification as a registered professional appraiser within five years after his initial registration;

     (2) a person registered as an assessor or assessor-collector attain certification as a registered Texas assessor within five years after his initial registration; and

     (3) a person registered as a collector attain certification as a registered Texas collector within three years after his initial registration.

Recertification; specialized classifications, designations and requirements

     Sec. 18. The board may adopt rules:

     (1) regarding recertification to assure that all persons certified continue to be duly registered and professionally competent so long as they are active in appraisal, assessment, or collections; and

     (2) establishing specialized classifications, designations, and requirements that are necessary to accomplish the purposes of this Act and maintain high standards of professional practice in all phases of property taxation.

     Secs. 19, 20. Repealed by Acts 1983, 68th Leg., p. 5342, ch. 980, § 2, eff. Sept. 1, 1983.

Discrimination prohibited

     Sec. 21. No person may be denied the right to register under the terms of this Act because of race, color, creed, sex, or ethnic origin.

Unprofessional manner or violation of Act required by appraisal district board of directors or governing body prohibited

     Sec. 22. No appraisal district board of directors or governing body of a taxing unit of this state may, as a necessity for employment, require that an appraiser, assessor, or collector act in an unprofessional manner or commit acts in violation of this Act. A complaint of a violation of this section shall be thoroughly investigated by the board.

     Sec. 23. Repealed by Acts 1983, 68th Leg., p. 5342, ch. 980, § 2, eff. Sept. 1, 1983.

Offenses and penalties; complaint concerning unauthorized practices

     Sec. 24. (a) A person who is required under Section 11 of this Act to register with the board commits a Class C misdemeanor if he fails to register.

     (b) A person commits an offense if he performs an appraisal, assessment, or collections function during a period in which his registration or certification with the board is revoked or suspended. An offense under this subsection is a Class B misdemeanor.

     (c) A person may file a complaint concerning the unauthorized practice of appraisal, assessment, or collections under this section with the county attorney of the county where the practice occurred or with the board.

     Sec. 24A. Repealed by Acts 1983, 68th Leg., p. 5342, ch. 980, § 2, eff. Sept. 1, 1983.

Acts 1977, 65th Leg., p. 1068, ch. 391, eff. Aug. 29, 1977. Sec. 24 amended by Acts 1979, 66th Leg., p. 206, ch. 116, § 1, eff. May 9, 1979; Sec. 2 amended by Acts 1981, 67th Leg., p. 3224, ch. 848, § 1, eff. Oct. 1, 1981; Sec. 11 amended by Acts 1981, 67th Leg., p. 3224, ch. 848, § 2, eff. Oct. 1, 1981; Sec. 12 amended by Acts 1981, 67th Leg., p. 3225, ch. 848, § 3, eff. Oct. 1, 1981; Sec. 16 amended by Acts 1981, 67th Leg., p. 3225, ch. 848, § 4, eff. Oct. 1, 1981; Sec. 17(a) amended by Acts 1981, 67th Leg., p. 3226, ch. 848, § 5, eff. Oct. 1, 1981; Secs. 13, 14 amended by Acts 1983, 68th Leg., p. 363, ch. 81, § 7(a), eff. Sept. 1, 1983; Secs. 2 to 4, 6 to 18, 22, 24 amended by Acts 1983, 68th Leg., p. 5329, ch. 980, § 1, eff. Sept. 1, 1983; Sec. 4(e) added by Acts 1985, 69th Leg., ch. 729, § 41, eff. Sept. 1, 1985; amended by Acts 1987, 70th Leg., ch. 167, § 2.20(26), eff. Sept. 1, 1987. Renumbered from art. 7244b by Acts 1989, 71st Leg., ch. 2, §§ 14.04, 16.02(d), eff. Aug. 28, 1989. Sec. 4(c) amended by Acts 1989, 71st Leg., ch. 218, § 1, eff. Sept. 1, 1989; Sec. 4(e) amended by Acts 1991, 72nd Leg., 1st C.S., ch. 17, § 6.26, eff. Nov. 12, 1991; Sec. 10(c) added by Acts 1993, 73rd Leg., ch. 416, § 9, eff. Sept. 1, 1993; Sec. 11A added by Acts 1993, 73rd Leg., ch. 501, § 1, eff. Aug. 30, 1993; Sec. 8(a) amended by Acts 1997, 75th Leg., ch. 1423, § 21.73, eff. Sept. 1, 1997; Sec. 8(b) amended by Acts 1999, 76th Leg., ch. 20, § 9, eff. Sept. 1, 1999; Sec. 11B added by Acts 1999, 76th Leg., ch. 591, § 1, eff. Sept. 1, 1999; Sec. 13 amended by Acts 1999, 76th Leg., ch. 591, § 1, eff. Sept. 1, 1999; Sec. 14A added by Acts 1999, 76th Leg., ch. 591, § 1, eff. Sept. 1, 1999.

Art. 8886. Registration of Property Tax Consultants

Definitions

     Sec. 1. (a) In this article:

     (1) "Commission" means the Texas Commission of Licensing and Regulation.

     (2) "Commissioner" means the commissioner of licensing and regulation.

     (3) "Council" means the Property Tax Consultants Advisory Council.

     (4) "Department" means the Texas Department of Licensing and Regulation.

     (5) "Person" means an individual, partnership, corporation, or association.

     (6) "Property tax consultant" means a person who performs or supervises others in the performance of property tax consulting services for compensation.

     (7) "Property tax consulting services" means:

     (A) preparing a property tax rendition or report for another person under Chapter 22, Tax Code;

     (B) representing another person in a protest under Subchapter C, Chapter 41, Tax Code;

     (C) consulting or advising another person concerning the preparation of a property tax rendition or report under Chapter 22, Tax Code, or concerning a matter the person may protest under Subchapter C, Chapter 41, Tax Code;

     (D) negotiating or entering into an agreement with an appraisal district on behalf of another person concerning a matter that is or may be the subject of a protest under Subchapter C, Chapter 41, Tax Code; or

     (E) acting as the designated agent of a property owner in accordance with Section 1.111, Tax Code.

     (b) "Registered property tax consultant" and "registered senior property tax consultant" include only individuals registered under this article.

Registration Required; Exemptions

     Sec. 2. (a) An individual may not perform property tax consulting services for compensation unless the individual is a registered property tax consultant or a registered senior property tax consultant.

     (b) A registered property tax consultant may not perform property tax consulting services for compensation unless the individual is employed by or associated with and acting for a registered senior property tax consultant.

     (c) A person may not represent that an individual is a registered property tax consultant, agent, advisor, or representative unless the individual is a registered property tax consultant or registered senior property tax consultant.

     (d) The registration requirement imposed under Subsection (a) of this section does not apply to:

     (1) an individual acting under a general power of attorney, unless the individual represents that the individual is a property tax consultant, agent, advisor, or representative;

     (2) an individual licensed to practice law in this state;

     (3) an employee of a property owner or of an affiliated or subsidiary company of a property owner, if the employee performs property tax consulting services for the property owner or for a partnership, joint venture, or corporation in which the property owner owns an interest;

     (4) a property owner's lessee who is designated as the agent of the property owner in accordance with Section 1.111, Tax Code;

     (5) a public employee or officer who provides assistance to a property owner in the course of the employee's or officer's duties;

     (6) a certified public accountant under the Public Accountancy Act of 1991 (Article 41a–1, Vernon's Texas Civil Statutes);

     (7) an individual who assists another person in the performance of property tax consulting services or provides testimony on behalf of the other person at a protest hearing under Subchapter C, Chapter 41, Tax Code, unless the individual is designated as the person's agent under Section 1.111, Tax Code, or more than 50 percent of the individual's employment time is devoted to or income is derived from performing or supervising the performance of property tax consulting services; or

     (8) an individual who holds an active license as a real estate broker or salesman under The Real Estate License Act (Article 6573a, Vernon's Texas Civil Statutes), or an active license as a state-licensed real estate appraiser or state-certified real estate appraiser under the Texas Appraiser Licensing and Certification Act (Article 6573a.2, Vernon's Texas Civil Statutes) providing property tax consultant services in connection with single-family residences.

     (e) An individual who is not required to be registered under this article may register under this article if the individual meets the registration requirements imposed by Sections 3, 4, and 5 of this article. An individual exempt from registration under this article who elects to be registered under this article is subject to the provisions of this article.

     (f) The requirements imposed by Subsection (b) of this section and Subsections (b) and (c) of Section 3 of this article do not apply to an individual who applies for registration under this article before March 1, 1992, and who, on the date of the application, is licensed and on active status as a real estate broker under The Real Estate License Act (Article 6573a, Vernon's Texas Civil Statutes), unless the individual performs or supervises the performance of property tax consulting services for compensation in connection with a property that is not real property. Subsection (b) of this section does not apply to an individual who is registered under Section 3(b)(2) of this article.

Eligibility

     Sec. 3. (a) To be eligible to register under this article, an individual must:

     (1) have the following qualifications:

     (A) be at least 18 years of age;

     (B) hold a high school diploma or an equivalent credential;

     (C) pay the fees required by the commission;

     (D) establish a place of business in this state or designate an agent for service of legal process who is a resident of this state; and

     (E) meet any additional qualifications required by this article or by the commissioner in the exercise of the commissioner's authority under this article or under Article 9100, Revised Statutes; or

     (2) hold an active license as a real estate broker or salesman under The Real Estate License Act (Article 6573a, Vernon's Texas Civil Statutes), or an active license as a state-licensed real estate appraiser or state-certified real estate appraiser under the Texas Appraiser Licensing and Certification Act (Article 6573a.2, Vernon's Texas Civil Statutes).

     (b) To be eligible to register as a property tax consultant under this article, an applicant must:

     (1) complete at least 15 classroom hours of educational courses approved by the commissioner, of which at least four hours must include instruction on laws and legal issues in this state related to property tax consulting services; or

     (2) furnish evidence to the commission that the applicant:

     (A) holds an active license as a real estate broker or salesman under The Real Estate License Act (Article 6573a, Vernon's Texas Civil Statutes), or an active license as a state-licensed real estate appraiser or state-certified real estate appraiser under the Texas Appraiser Licensing and Certification Act (Article 6573a.2, Vernon's Texas Civil Statutes); and

     (B) has completed at least four classroom hours in educational programs or courses on the legal issues and laws related to property tax consulting services.

     (c) To be eligible to register as a senior property tax consultant under this article, an applicant must:

     (1) acquire at least 25 credits as provided by Subsections (d) through (h) of this section;

     (2) have performed or supervised other persons in the performance of property tax consulting services as the applicant's primary occupation for at least four of the seven years preceding the date of the application; and

     (3) pass the examination required under this article for registration as a senior property tax consultant or hold a professional designation in property taxation granted by a nonprofit, voluntary trade association, institute, or organization that has a membership primarily composed of persons who represent property owners in property tax and transactional tax matters and that:

     (A) has written experience and examination requirements for granting the professional designation; and

     (B) subscribes to a code of professional conduct or ethics.

     (d) The commissioner shall grant an applicant for registration as a senior property tax consultant two credits for each year the applicant completed at an institution of higher education that meets program and accreditation standards comparable to public institutions of higher education as determined by the Texas Higher Education Coordinating Board. The applicant is entitled to not more than six credits under this subsection.

     (e) The commissioner shall grant an applicant for registration as a senior property tax consultant four credits if the applicant has been issued a bachelor's degree or its equivalent from an institution of higher education described in Subsection (d).

     (f) The commissioner shall grant an applicant for registration as a senior property tax consultant one credit for each of the years in excess of five years that the applicant's primary occupation involved the performance or supervision of property tax consultant services or property appraisal, assessment, or taxation. The applicant is entitled to not more than 10 credits under this subsection.

     (g) The commissioner may grant an applicant for registration as a senior property tax consultant additional credits, as determined by the commissioner, for successful completion of educational programs or courses on property taxation, the property tax system, property tax administration, the standards of ethics or the general principles of appraisal, accounting, and law as they relate to property tax consulting services. In determining the credit entitlement for each program or course, the commissioner shall consider the nature of the program or course, the number of actual instructional hours involved in the program or course, whether an examination is required for successful completion of the program or course, and other factors the commissioner deems appropriate for the evaluation of the program or course. The commissioner may assign a minimum of one credit and a maximum of five credits to a program or course.

     (h) The commissioner may grant an applicant for registration as a senior property tax consultant additional credits, as determined by the commissioner, for other educational programs or courses completed by an applicant or for an applicant's advanced or postgraduate educational achievement, occupational experience, professional licenses, or professional designations from recognized institutes, organizations, or associations.

     (i) The commissioner may give appropriate credit to an initial applicant for educational courses on the principles of law related to property tax consulting services that were completed by an applicant not more than two years before the date of the application.

     (j) The commissioner may give appropriate credit to an initial applicant for educational programs or courses on property taxation, the property tax system, property tax administration, ethical standards, or general principles of appraisal, accounting, or law as they relate to property tax consulting services.

Examination

     Sec. 4. (a) The senior property tax consultant registration examination must be adopted by the commissioner and be graded according to rules adopted by the commissioner. The examination must test the applicant's knowledge of property taxation, the property tax system, property tax administration, ethical standards, and the general principles of appraisal, accounting, and law as they relate to property tax consulting services. The commissioner shall establish the standards for passing the examination.

     (b) The department shall conduct the senior property tax consultant registration examination at times and places designated by the commissioner.

     (c) Each individual applying for examination shall pay an examination fee to the department. The commissioner may establish by rule conditions for the refund of this fee to applicants who do not take the examination.

     (d) Not later than the 30th day after the date on which a registration examination is administered under this article, the commission shall notify each examinee of the results of the examination.

     (e) If requested in writing by an examinee who fails a licensing examination, the commission shall provide the examinee with an analysis of the examinee's performance on the examination.

     (f) Expired.

Registration Procedure; Renewal

     Sec. 5. (a) An applicant for registration must file an application with the department on a printed form prescribed by the commissioner. The application must be accompanied by an nonrefundable application fee and a registration fee, which shall be refunded if the commissioner does not approve the application.

     (b) The commissioner shall act on an initial application not later than the 31st day after the date on which the department receives the application.

     (c) The commissioner may waive any registration requirement for an applicant who holds a valid registration certificate or license issued by another state that has requirements that were, on the date of the registration or licensing, substantially equal to those of this state. An applicant for registration under this subsection shall apply in the same manner as any other applicant and shall furnish the department with documents and other evidence substantiating the applicant's qualifications as required by the department.

     (d) The commissioner shall issue to each applicant that qualifies for registration under this article the appropriate certificate of registration. Except as otherwise provided by the commission, a certificate of registration is valid for two years from the date of issuance.

     (e) On the timely receipt of the required renewal fee, the commissioner shall issue to an eligible registered property tax consultant or registered senior property tax consultant a certificate of renewal of registration that is valid for two years after the date of issuance.

     (f) The commissioner by rule shall require that each registrant complete during each registration period a minimum of 20 classroom hours of continuing education courses recognized by the commissioner as a prerequisite to renewal of registration. The rules must require that at least six of the 20 hours required include instruction on laws and legal issues in this state related to property tax consulting services.

     (g) If an individual's registration has been expired for less than 30 days after the date of expiration, the individual may renew the registration by paying the unpaid renewal fees plus a late registration renewal fee. If the individual's registration has been expired for one year or more, the individual may not renew the registration. The individual may obtain a new certificate of registration by complying with the requirements for an original application.

     (h) A continuing education course, including a course on the legal issues and law related to property tax consulting services, approved by the Texas Real Estate Commission or the Texas Appraiser Licensing and Certification Board and completed by a registrant who holds an active license as a real estate broker or salesman under The Real Estate License Act (Article 6573a, Vernon's Texas Civil Statutes), or an active license as a state-licensed real estate appraiser or state-certified real estate appraiser under the Texas Appraiser Licensing and Certification Act (Article 6573a.2, Vernon's Texas Civil Statutes), shall be recognized by the commissioner as an appropriate continuing education program for the purposes of this section.

General Powers and Duties of Commissioner

     Sec. 6. (a) The commissioner by rule shall establish standards of practice, conduct, and ethics for registrants.

     (b) The commissioner by rule shall recognize appropriate continuing education programs for registrants under this article.

     (c) The commissioner may recognize any educational program or course that is related to property tax consulting services and that is offered or sponsored by any public or recognized private provider, including:

     (1) the State Property Tax Board;

     (2) the State Bar of Texas;

     (3) the Texas Real Estate Commission;

     (4) any institution of higher education that meets program and accreditation standards comparable to public institutions of higher education as determined by the Texas Higher Education Coordinating Board; or

     (5) a nonprofit, voluntary trade association, institute, or organization whose membership is primarily composed of persons who represent property owners in property tax or transactional tax matters and that:

     (A) has written requirements of experience and examination as a prerequisite for an individual's membership or for granting professional designation to its members; and

     (B) subscribes to a code of professional conduct or ethics.

     (d) The commissioner may recognize a private provider of an educational program or course if the provider:

     (1) applies with the department on a printed form prescribed by the commissioner;

     (2) pays a nonrefundable application fee established by the commission; and

     (3) pays an educational provider's fee established by the commission, which shall be refunded if the commissioner does not recognize the provider's educational program or course offering.

Property Tax Consultant Registration Fund

     Sec. 7. (a) The department shall receive and account for all fees collected or money derived under this article.

     (b) The department shall deposit all money received under this article in the state treasury not later than three working days after the money is received. Money received under this article may be used only for the administration and enforcement of this article.

Disciplinary Action

     Sec. 8. After a hearing the commissioner may deny, suspend, or revoke a certificate of registration and may impose administrative sanctions and penalties and seek injunctive relief and civil penalties against a registrant as provided by Article 9100, Revised Statutes, on the following grounds:

     (1) a violation of this article or of a rule applicable to the registrant adopted by the commissioner under this article;

     (2) gross incompetency in the performance of property tax consulting services;

     (3) dishonesty or fraud committed while performing property tax consulting services; or

     (4) violation of the standards of ethics adopted by the commissioner.

Criminal Penalty

     Sec. 9. (a) An individual commits an offense if the individual is required to register under this article, is not registered under this article, and performs or offers to perform property tax consulting services for compensation.

     (b) A person commits an offense if the person represents that an individual is a property tax consultant, agent, counselor, advisor, or representative, knowing that the individual is required to be registered under this article and is not registered.

     (c) An offense under this section is a Class B misdemeanor.

Property Tax Consultants Advisory Council

     Sec. 10. (a) The Property Tax Consultants Advisory Council is created. The council is composed of six members appointed by the commission. The commission may appoint not more than two members who are qualified for exemption under Section 2(d)(3) of this article. Each individual appointed for membership on the council must:

     (1) be a registered senior property tax consultant;

     (2) be a member of a nonprofit, voluntary trade association that:

     (A) has a membership primarily composed of individuals who perform property tax consulting services in this state or who engage in property tax management in this state for other persons;

     (B) has written requirements of experience and examination as a prerequisite for an individual's membership; and

     (C) subscribes to a code of professional conduct or ethics;

     (3) be a resident of this state for the five years preceding the date of the appointment; and

     (4) have performed or supervised the performance of property tax consulting services as the individual's primary occupation continuously for the five years preceding the date of the appointment.

     (b) An individual is not eligible for appointment as a member of the council if the individual is:

     (1) required to register with the secretary of state under Chapter 305, Government Code;

     (2) required to register with the Board of Tax Professional Examiners under Article 8885, Revised Statutes; or

     (3) exempt from the registration requirements imposed by this article, except as provided by Subsection (a) of this section.

     (c) Before March 1 of each year, the members of the council shall elect one member to serve as presiding officer of the council until the last day of February of the following year.

     (d) Members of the council serve for staggered three-year terms with the terms of two members expiring February 1 of each year. In the event of a vacancy during a member's term, the commissioner shall appoint to fill the unexpired part of the term a replacement who meets the qualifications of the vacated office.

     (e) The council shall:

     (1) recommend to the commissioner standards of practice, conduct, and ethics for registrants to be adopted under this article;

     (2) recommend to the commission amounts for the fees it may set under this article;

     (3) recommend to the commissioner contents for the senior property tax consultant registration examination and standards of acceptable performance;

     (4) assist and advise the commissioner in recognizing continuing education programs and educational courses for registrants; and

     (5) advise the commissioner in establishing educational requirements for initial applicants.

     (f) A member of the council is not entitled to receive compensation for serving as a member. A member is entitled to reimbursement for reasonable expenses incurred in performing duties as a member, subject to applicable limitations in the General Appropriations Act.

     (g) The council shall meet at least semiannually at the call of the presiding officer or at the call of a majority of its members. A decision of the council is not effective unless it receives the affirmative vote of at least four members.

Added by Acts 1991, 72nd Leg., ch. 869, § 1, eff. Sept. 1, 1991. Sec. 1(a)(6) amended by Acts 1995, 74th Leg., ch. 727, § 1, eff. Sept. 1, 1995; Sec. 2(c), (d), (f) amended by Acts 1995, 74th Leg., ch. 727, § 2, eff. Sept. 1, 1995; Sec. 3(a), (b) amended by Acts 1995, 74th Leg., ch. 727, § 3, eff. Sept. 1, 1995; Sec. 5(h) added by Acts 1995, 74th Leg., ch. 727, § 5, eff. Sept. 1, 1995.

CHAPTER 19—BOAT OR MOTOR MANUFACTURERS, DISTRIBUTORS, AND DEALERS

Art. 8911. Boat or motor manufacturers, distributors, and dealers; regulation

Definitions

     Sec. 1. In this Act:

     (1) "Boat" means:

     (A) a motorboat; or

     (B) any other vessel more than 14 feet long that is designed to be propelled by means of a sail.

     (2) "Motorboat" has the meaning assigned by Section 31.003(3), Parks and Wildlife Code.

     (3) "Outboard motor" has the meaning assigned by Section 31.003(13), Parks and Wildlife Code.

     (4) "New" has the meaning assigned by Section 31.003(12), Parks and Wildlife Code.

     (5) "Manufacturer" has the meaning assigned by Section 31.003(11), Parks and Wildlife Code.

     (6) "Dealer" has the meaning assigned by Section 31.003(7), Parks and Wildlife Code.

     (7) "Distributor" means a person who offers for sale, sells, or distributes new boats or new outboard motors to dealers or who controls a person who does so.

     (8) "Agreement" means a written agreement between a manufacturer or distributor and a dealer for the purchase and sale of new boats or new outboard motors.

     (9) "Vessel" has the meaning assigned by Section 31.003(2), Parks and Wildlife Code.

Dealer agreement

     Sec. 2. A manufacturer or distributor contracting with a dealer may not sell or offer for sale, and a dealer may not purchase or offer to purchase, a new boat or a new outboard motor without first entering into an agreement that complies with this Act. Each agreement must include:

     (1) the dealer's location, territory, or market area;

     (2) the length of the agreement;

     (3) any performance or marketing standards;

     (4) any working capital, inventory, facility, equipment, or tool standards;

     (5) provisions for termination or nonrenewal of the agreement and the designation of a successor dealer in the event of the death or disability of the dealer;

     (6) the obligations of the manufacturer, distributor, and dealer in the preparation and delivery of and warranty service on new boats and new outboard motors;

     (7) the obligations of the manufacturer, distributor, and dealer on termination of the agreement, including inventory of new boats and new outboard motors, parts inventory, equipment, furnishings, special tools, and required signs; and

     (8) dispute resolution procedures.

Prohibitions

     Sec. 3. (a) Notwithstanding the terms of a dealer agreement, a dealer agreement and any transaction subject to this Act must comply with the requirements of this section.

     (b) If a new boat, new outboard motor, or parts are publicly advertised as available for immediate delivery, a manufacturer or distributor shall deliver the boats, outboard motors, or parts in reasonable quantities and within a reasonable time after receipt of an order from a dealer having an agreement with that manufacturer or distributor that covers the advertised boats, outboard motors, or parts unless the delivery is prevented by circumstances beyond the control of the manufacturer or distributor.

     (c) An agreement may not be terminated by a manufacturer or distributor unless:

     (1) the manufacturer or distributor has given the dealer written notice of termination in clear, concise terms;

     (2) the notice sets forth the reasons for the termination of the agreement;

     (3) the dealer has been given 30 days to exert good faith efforts to cure the causes listed in the notice; and

     (4) there is good cause for the termination.

     (d) In this section, "good cause" does not include the fact that a dealer holds a dealer agreement involving another line, make, or brand of new boat or new outboard motor. Good cause is not required in the case of nonrenewal of a dealer agreement except for an agreement for which the original term of the agreement is for a period of less than one year.

     (e) An agreement may be terminated by a manufacturer or distributor on written notice of any of the following:

     (1) the dealer's financial default to the manufacturer or distributor or financing source;

     (2) the dealer becomes subject to an order for relief as that term is used in Title 11, United States Code;

     (3) fraudulent conduct by the dealer in the conduct of its business or in the performance of its agreement with the manufacturer or distributor;

     (4) the dealer, if a corporation, ceases to exist;

     (5) the dealer becomes insolvent or takes or fails to take any action that constitutes an admission of inability to pay debts as they mature;

     (6) the dealer makes a general assignment for the benefit of creditors to an agent authorized to liquidate any substantial amount of assets; or

     (7) the dealer applies to a court for the appointment of a receiver for any assets or properties.

     (f) A manufacturer or distributor may not withhold unreasonably approval of any sale, transfer, or passage of title of a dealer, dealer agreement, management of the dealer, or designation of a successor dealer, if the dealer complies with the provisions, if any, set out in the agreement for the sale, transfer, or passage of title, and the transferee meets the criteria set out in the agreement or those criteria generally applied by the manufacturer or distributor in similar situations, and the transferee agrees to be bound by all the terms and conditions of the manufacturer's or distributor's standard agreement.

     (g) A dealer shall be fairly compensated for the work and services the dealer is required to perform and for other expenses incurred to comply with a manufacturer's or distributor's warranty. A manufacturer or distributor may not pay a dealer a labor rate for warranty work that is less than that charged by the dealer to its retail customers for nonwarranty work of the same kind by similar technicians. However, if the manufacturer or distributor has in effect a warranty program in which the dealer can comply with reasonable and objective criteria and as a result obtain 100 percent of the dealer's retail labor rate, the labor rate for warranty work shall be as the terms of the program require but may not be less than 80 percent of the dealer's retail labor rate. All claims by a dealer for warranty work must be approved or disapproved and paid, if due, within a reasonable time. If a claim is disapproved, the dealer must be notified of the grounds for disapproval.

     (h) A dealer may not pay or assume a part of a refund, rebate, discount, or other financial adjustment made by the manufacturer or distributor to a customer or a dealer unless the dealer voluntarily agrees to make the payment or assumption.

     (i) On termination of a dealer agreement by a manufacturer or distributor, the manufacturer or distributor shall repurchase, on written demand from the dealer not later than 30 days after the date of termination:

     (1) any new, unsold, retailable, undamaged, and complete boat, with accessories and packaged trailers sold with the boat by the manufacturer or distributor, or outboard motor purchased from the manufacturer or distributor within the one-year period before the date of the termination, in the dealer's inventory, at dealer's invoiced cost, less all allowances paid to the dealer; and

     (2) any new, current, unsold, undamaged, and unused parts or accessories for boats or outboard motors, in the original resalable merchandising package, purchased by the dealer from the manufacturer or distributor at dealer's invoiced cost.

     (j) The cost incurred by the dealer in transporting an item listed in Subsection (i) of this section to the manufacturer shall be paid by the manufacturer or distributor.

     (k) The dealer shall provide the manufacturer or distributor with a complete list of all items listed in Subsection (i) of this section that are to be repurchased. The manufacturer or distributor shall have a reasonable time to complete the repurchase. The manufacturer's and distributor's repurchase obligation extends only to property that is free and clear of any lien or encumbrance.

     (l) A manufacturer or distributor may not require a dealer to finance a new boat or outboard motor sold by that dealer through a particular financing source. A manufacturer or distributor may not require that a dealer act as agent of a manufacturer or distributor in the securing of a promissory note and security agreement in connection with the sale or purchase of a new boat or new outboard motor, or the securing of a policy of insurance on the operation of a new boat or new outboard motor sold.

     (m) A dealer may not be required to submit to arbitration on an issue between the dealer and the manufacturer or distributor at a location that is out of state or an unreasonable distance from the dealer's principal place of business.

     (n) After termination of an agreement by a manufacturer or distributor for any reason except for quality of service or a reason justifying immediate termination under Subsection (e) of this section, the former dealer has the right to continue to purchase parts and accessories to service the products covered by the agreement for 12 months after the date of termination. The sale of parts and accessories under this subsection shall be at the same price offered to a current dealer.

     (o) Venue of a dispute under an agreement is in the county of the dealer's principal place of business as set forth in the dealer agreement.

     (p) A person who violates this Act or any term of an agreement regulated by this Act is liable to an injured party for actual damages caused by the violation and, if litigation is commenced in connection with the violation, reasonable legal fees and court costs.

Acts 1991, 72nd Leg., ch. 479, eff. Sept. 1, 1991.

Art. 8930. Self-Directed Semi-Independent Agency Project Act

Short Title

     Sec. 1. This Act shall be known as the Self-Directed Semi-Independent Agency Project Act.

Agency Participation

     Sec. 2. The following agencies shall be part of the pilot project created by this Act:

     (1) the Texas State Board of Public Accountancy;

     (2) the Texas Board of Professional Engineers; and

     (3) the Texas Board of Architectural Examiners.

Definition

     Sec. 3. In this Act, "project agency" means an agency listed in Section 2 of this Act.

Pilot Project

     Sec. 4. (a) Notwithstanding any other provision of law, each project agency shall become self-directed and semi-independent as specified in this Act.

     (b) Each project agency shall continue to be a state agency, as that term is defined in Section 2001.003(7), Government Code.

     (c) This Act is subject to Chapter 325, Government Code (Texas Sunset Act). Unless continued in existence as provided by that chapter, this Act expires September 1, 2003.

General Duties of All Project Agencies

     Sec. 5. In addition to the duties enumerated in the enabling legislation specifically applicable to each project agency, each project agency shall have the duties prescribed by Sections 6 through 9 of this Act.

Budget

     Sec. 6. (a) A project agency shall adopt a budget annually using generally accepted accounting principles. The budget shall be reviewed and approved only by the project agency's governing board notwithstanding any other provision of law, including the General Appropriations Act. No costs shall be incurred by the general revenue fund. A project agency shall be responsible for all costs, both direct and indirect.

     (b) A project agency shall keep financial and statistical information as necessary to disclose completely and accurately the financial condition and operation of the project agency.

     (c) The Texas State Board of Public Accountancy shall annually remit $500,000 to the general revenue fund, the Texas Board of Professional Engineers shall annually remit $50,000 to the general revenue fund, and the Texas Board of Architectural Examiners shall annually remit $700,000 to the general revenue fund.

Audits

     Sec. 7. Nothing in this Act shall affect the duty of the State Auditor to audit a project agency. The State Auditor shall enter into a contract and schedule with each project agency to conduct audits, including financial reports and performance audits. Costs incurred in performing such audits shall be reimbursed by the project agency.

Reporting Requirements

     Sec. 8. (a) A project agency shall submit to the legislature and the governor by the first day of the regular session of the legislature a report describing all of the agency's activities in the previous biennium. The report shall include:

     (1) an audit required by Section 7 of this Act;

     (2) a financial report of the previous fiscal year;

     (3) a description of any changes in licensing fees;

     (4) a report on the number of examination candidates, licensees, certificate holders, and enforcement activities and any changes in those figures; and

     (5) a description of all new rules adopted or repealed.

     (b) In addition to the reporting requirements of Subsection (a) of this section, each project agency shall report annually, not later than November 1, to the governor, to the committee of each house of the legislature that has jurisdiction over appropriations, and to the Legislative Budget Board the following:

     (1) the salary for all project agency personnel and the total amount of per diem expenses and travel expenses paid for all agency employees;

     (2) the total amount of per diem expenses and travel expenses paid for each member of the governing body of each project agency;

     (3) each project agency's operating plan and budget covering a two-year period; and

     (4) a detailed report of all revenue received and all expenses incurred by the project agency in the previous 12 months.

Disposition of Fees Collected

     Sec. 9. If provided in a project agency's enabling legislation, the project agency shall collect a professional fee of $200 from its licensees annually which shall be remitted to the state. If provided in a project agency's enabling legislation, the project agency shall collect a scholarship fee of $10 annually from its licensees and shall remit it to the state.

General Powers of All Project Agencies

     Sec. 10. In addition to the powers enumerated in each project agency's enabling legislation, each project agency shall have the powers described in Sections 11 through 14 of this Act.

Ability to Contract

     Sec. 11. To carry out and promote the objectives of this Act, a project agency may enter into contracts and do all other acts incidental to those contracts that are necessary for the administration of its affairs and for the attainment of its purposes; provided, however, that any indebtedness, liability, or obligation of the project agency shall not:

     (1) create a debt or other liability of the state or any other entity other than the project agency; or

     (2) create any personal liability on the part of the members of the board of the project agency or its employees.

Property

     Sec. 12. A project agency may acquire by lease, and maintain, use, and operate, any real, personal, or mixed property necessary to the exercise of the powers, rights, privileges, and functions of the agency.

Suits

     Sec. 13. The office of the attorney general shall represent a project agency in any litigation. The attorney general may assess and collect from the project agency reasonable attorney's fees associated with any litigation under this section.

Fees

     Sec. 14. Subject to the limitations, if any, in the applicable enabling legislation, each project agency may set the amount of fees by statute or rule as necessary for the purpose of carrying out the functions of the project agency.

Post-Participation Liability

     Sec. 15. (a) If a state agency no longer has status under this Act as a self-directed semi-independent project agency either because of the expiration of this Act or for any other reason, the agency shall be liable for any expenses or debts incurred by the agency during the time the agency participated in the pilot project. The agency's liability under this section includes liability for any lease entered into by the agency. The state is not liable for any expense or debt covered by this subsection, and money from the general revenue fund may not be used to repay the expense or debt.

     (b) If a state agency no longer has status under this Act as a self-directed semi-independent project agency either because of the expiration of this Act or for any other reason, ownership of any property or other asset acquired by the agency during the time the agency participated in the pilot project shall be transferred to the state.

Open Government

     Sec. 16. Subject to the confidentiality provisions of a project agency's enabling legislation:

     (1) meetings of the project agency are subject to Chapter 551, Government Code; and

     (2) records maintained by the project agency are subject to Chapter 552, Government Code.

Membership in Employee Retirement System

     Sec. 17. Employees of the project agencies are members of the Employees Retirement System of Texas under Chapter 812, Government Code, and transition to independent status shall have no effect on their membership.

Added by Acts 1999, 76th Leg., ch. 1552, § 2, eff. Sept. 1, 1999.

CHAPTER TWENTY—MISCELLANEOUS

Art. 9004. Shipping articles without inspection

     Whoever shall export from this State, or ship for the purpose of exportation to any one of the United States or to any foreign port, any article of commerce which by any law of this State may be required to be inspected by a public inspector without having caused said inspection to be made according to law, shall be fined not exceeding one hundred dollars.

Art. 9006. Unlawfully throwing ballast

     If any part of the ballast of any vessel shall be thrown from such vessel into the sea within six miles of any bar or harbor in this State, the master or officer in charge thereof at the time shall be fined not less than one hundred nor more than two hundred dollars.

Acts 1879, p. 153.

Art. 9009. Secondhand metal dealers; records and reports of purchases and sales of copper, brass and bronze materials

Definitions

     Sec. 1. As used in this Act:

     (1) "Aluminum material" means a product made from aluminum, an aluminum alloy, or an aluminum by-product. The term includes an aluminum beer keg, but does not otherwise include an aluminum can used to contain a food or beverage.

     (2) "Bronze material" means:

     (A) a cemetery vase, receptacle, or memorial made from bronze;

     (B) bronze statuary; or

     (C) material that is readily identifiable as bronze.

     (3) "Copper or brass material" means insulated or noninsulated copper wire or cable of the type used by public utilities or common carriers that consists of at least 50 percent copper, copper or brass items of a type commonly used in construction or by public utilities, or any combination consisting only of those items.

     (4) "Passport" means a passport issued by the United States or issued by another country and recognized by the United States.

     (5) "Personal identification certificate" means a personal identification card issued by the Department of Public Safety under Section 14A, Chapter 173, Acts of the 47th Legislature, Regular Session, 1941 (Article 6687b, Vernon's Texas Civil Statutes), or an analogous card or certificate issued by another state.

     (6) "Regulated material" means aluminum material, bronze material, or copper or brass material.

     (7) "Secondhand metal dealer" means an auto wrecker, a scrap metal processor, or any other person or organization purchasing, gathering, collecting, soliciting, or traveling about from place to place procuring regulated material, or any person operating, carrying on, conducting, or maintaining a scrap metal yard or other place where scrap metal or cast-off regulated material of any kind is gathered together or kept for shipment, sale, or transfer.

Duty to Maintain Record; Exhibition; Form and Contents

     Sec. 2. (a) Each secondhand metal dealer in this state shall keep an accurate and legible written record of any purchase made in the course of the dealer's business from an individual of:

     (1) copper or brass material in excess of 50 pounds;

     (2) bronze material; or

     (3) aluminum material in excess of 40 pounds.

     (b) The record must be in English and must include:

     (1) the place and date of each purchase;

     (2) the name and address of each individual from whom the regulated material is purchased or obtained;

     (3) the identifying number of the seller's driver's license, military identification card, passport, or personal identification certificate;

     (4) a description made in accordance with the custom of the trade of the type of regulated material purchased, and the quantity of the material; and

     (5) a signed statement by the seller that states the seller's right of legal ownership or right to sell the regulated material offered for sale.

     (c) A person attempting to sell a regulated material to a secondhand metal dealer must:

     (1) display to the secondhand metal dealer the person's driver's license, military identification card, passport, or personal identification certificate or, if the seller does not have a driver's license, military identification card, passport, or personal identification certificate, a statement signed by the seller that states that the seller does not possess any of these types of identification; and

     (2) sign a written statement provided by the secondhand metal dealer that states that the person is the legal owner of, or is lawfully entitled to sell, the regulated material offered for sale.

     (d) If a person is required by a municipality to prepare a signed statement consisting of the same information required by Subsection (c)(1) or (2) of this section, the person may use the statement required by the municipality to comply with the requirements of Subsection (c)(1) or (2) of this section.

     (e) The secondhand metal dealer or the dealer's agent shall visually verify the accuracy of the identification presented by the seller at the time of the purchase of a regulated material.

     (f) A person commits an offense if that person, with the intent to deceive:

     (1) makes a material and false statement or representation to a secondhand metal dealer in connection with the dealer's efforts to obtain the information required under Section 2(b) of this Act;

     (2) displays to a secondhand metal dealer a false or invalid driver's license, military identification card, passport, or personal identification certificate in connection with the person's attempted sale of any regulated material; or

     (3) makes a material and false statement or representation to a secondhand metal dealer in connection with that person's execution of a written statement required by Section 2 (c)(1) or (2) of this Act.

Preservation of Records

     Sec. 3. Each secondhand metal dealer shall preserve the records required by Section 2 of this Act for a period of at least three years.

Inspections, reports, mailing

     Sec. 4. (a) On request, a secondhand metal dealer shall permit any peace officer of this state to inspect, during the usual and customary business hours of the dealer, a record compiled under Section 2 of this Act, and any regulated materials in the possession of the dealer. The inspecting officer shall identify himself as a peace officer.

     (b) Except as provided by Subsection (c) of this section, not later than seven days after the purchase or other acquisition of any material required to be recorded under Section 2 of this Act, a secondhand metal dealer must mail to or file with the Department of Public Safety a report containing the information required to be recorded in Section 2 of this Act.

     (c) If a secondhand metal dealer purchases any bronze material that is a cemetery vase, receptacle, memorial, or statuary or any aluminum irrigation pipe that can reasonably be identified as aluminum irrigation pipe from a person other than the manufacturer or fabricator of the material, a seller bearing a bill of sale for the material, or the owner of the material, the dealer shall provide oral notification to the Department of Public Safety not later than the close of business on the dealer's next working day following the date of the purchase and, not later than the fifth day after the date of the purchase, shall mail to or file with the Department of Public Safety a report containing the information required to be recorded in Section 2 of this Act.

Notice to hold items; dealers

     Sec. 5. (a) If a peace officer has reasonable suspicion to believe that certain items consisting or composed of regulated materials and in the possession of a secondhand metal dealer are stolen, the peace officer may place the items on hold as provided by this section. If the officer places the items on hold, the officer shall issue a hold notice to the dealer.

     (b) The hold notice must be in writing, and must:

     (1) specifically identify the items alleged to be stolen and subject to the hold; and

     (2) inform the dealer of the requirements imposed under Subsection (c) of this section.

     (c) On receipt of a hold notice under this section, a secondhand metal dealer may not process or remove from the dealer's premises the items subject to the hold, or any part of those items, until the expiration of the 10th day after the date on which the notice is issued, unless the hold is released at an earlier time in writing by a peace officer of this state or an order of a court of competent jurisdiction. At the expiration of the holding period, the hold is automatically released and the dealer may dispose of the regulated material unless another disposition of the material has been ordered by a court of competent jurisdiction.

Notice to sellers

     Sec. 6. (a) A secondhand metal dealer must at all times maintain in a prominent place in the dealer's place of business, in open view to a seller of a regulated material, a notice in two-inch lettering that:

     (1) includes the following language:

"A PERSON ATTEMPTING TO SELL ANY REGULATED MATERIAL MUST PRESENT SUFFICIENT IDENTIFICATION REQUIRED BY STATE LAW."

"WARNING: STATE LAW PROVIDES A CRIMINAL PENALTY FOR A PERSON WHO INTENTIONALLY PROVIDES A FALSE DOCUMENT OF IDENTIFICATION OR OTHER FALSE INFORMATION TO A SECONDHAND METAL DEALER WHILE ATTEMPTING TO SELL ANY REGULATED MATERIAL.";

     and

     (2) states the secondhand metal dealer's usual business hours.

     (b) The notice required by this section may be contained on a sign that contains another notice if the secondhand metal dealer is required to display another notice under applicable law.

Violations, penalties

     Sec. 7. (a) A person who knowingly or intentionally violates any provision of this Act commits an offense.

     (b) Except as provided by Subsection (c) of this section, an offense under this section is a Class B misdemeanor.

     (c) An offense under this section is a Class A misdemeanor if a person:

     (1) knowingly or intentionally violates a provision of this Act; and

     (2) has been convicted for a violation of this Act within the 36 months preceding the date of the offense.

     (d) In addition to the penalties imposed under this section, a court, on the conviction of a secondhand metal dealer for an offense under Subsection (c) of this section, may order that the dealer cease from engaging in business as a secondhand metal dealer for a period not to exceed 30 days from the date of the order for each violation that forms the basis of the conviction.

Application, exempt purchases and sales

     Sec. 8. This Act does not apply to a purchase of a regulated material from a manufacturing, industrial, or other commercial vendor that sells regulated materials in the ordinary course of the vendor's business.

Acts 1967, 60th Leg., p. 1049, ch. 460, eff. June 12, 1967. Secs. 2 to 4 amended by Acts 1975, 64th Leg., p. 380, ch. 169, §§ 1 to 3, eff. Sept. 1, 1975. Amended by Acts 1991, 72nd Leg., ch. 398, § 1, eff. Sept. 1, 1991.

Art. 9009a. Crafted precious metals; dealer purchase and disposition

Definitions

     Sec. 1. In this Act:

     (1) "Crafted precious metals" includes jewelry, silverware, art objects, or any other thing or object made, in whole or in part, from gold, silver, platinum, palladium, iridium, rhodium, osmium, ruthenium, or their alloys, excluding coins and commemorative medallions.

     (2) "Dealer" means a person who engages in the business of purchasing and selling crafted precious metals.

     (3) "Department" means the Department of Public Safety of the State of Texas.

     (4) "Person" means an individual, association, corporation, or any other legal entity.

     (5) "Temporary location" means a place where business is conducted for a period shorter than 90 days.

Purchases from Minor

     Sec. 2. (a) A dealer may not purchase crafted precious metals from a person under 18 years of age unless the seller delivers to the dealer before the purchase a written statement from a parent or legal guardian of the seller consenting to the transaction. The dealer shall preserve the statement with the records required to be kept under this Act. The dealer may destroy the statement one year from date of purchase or until the item is sold, whichever occurs later.

     (b) A person who fails to obtain or keep a statement as required by this section commits a Class B misdemeanor.

Report of Purchasing

     Sec. 3. (a) Not later than 48 hours after the time it is received, each dealer shall report in accordance with Section 4 of this Act all identifiable crafted precious metal that the dealer purchases, takes in trade, accepts for sale on consignment, or accepts for auction.

     (b) Each dealer, before the time any crafted precious metal is offered for sale or exchange, shall notify each person intending to sell or exchange the crafted precious metal that the person must file with the dealer, before the dealer may accept any of the person's property, a list describing all of the person's crafted precious metal to be accepted by the dealer. The list must set forth:

     (1) the name and address of the proposed seller;

     (2) a complete and accurate description of the crafted precious metal;

     (3) a certification by the proposed seller that the information is true and complete; and

     (4) the driver's license number or DPS identification card number of the seller, as recorded by the dealer upon being physically presented the driver's license or DPS identification card by the seller.

     (c) On demand the dealer shall provide the list required by Subsection (b) of this section to any peace officer and shall mail or deliver a complete copy of each list to the chief of police or to the sheriff in accordance with Section 4 of this Act not later than 48 hours after it is filed with the dealer.

     (d) A dealer who fails to make or permit inspection of a report as required by this section commits a Class B misdemeanor.

Form of Report; Filing

     Sec. 4. (a) Each report required by this Act must be filed in accordance with this section unless a similar report is required by other state law or by a city ordinance. If such a report is required, the report must comply with and be submitted in accordance with the applicable law or ordinance.

     (b) If a transaction regulated by this Act takes place inside an incorporated municipality, any report required by this Act shall be submitted to the chief of police of the municipality. If the transaction takes place outside an incorporated city or inside an incorporated city that does not maintain a police department, the report shall be submitted to the sheriff of the county where the transaction takes place.

     (c) In the absence of other state law, or a city ordinance, that requires reporting of property acquired by a dealer in a transaction enumerated by Section 3(a) of this Act, the report shall be submitted on forms prescribed by the district attorney or person performing the duties of district attorney of the county where the transaction occurs.

     (d) The original report and a copy shall be submitted by the dealer in accordance with Subsection (b) of this section. The dealer shall retain a copy of the report until the third anniversary of the date on which the report is filed.

     (e) A dealer who fails to make or permit inspection of a report as required by this section commits a Class B misdemeanor.

Retention of Property

     Sec. 4A. (a) A dealer may not melt, deface, alter, or dispose of crafted precious metal for which a report is required under this Act before the 11th day after the day on which the report is filed unless:

     (1) the peace officer to whom the report is submitted, for some good cause, authorizes disposition of that crafted precious metal;

     (2) the dealer obtains the name, address, and description of the buyer and retains this information record, which shall be made available for inspection by any peace officer; or

     (3) the dealer is a pawnbroker and the disposition is the redemption of pledged property by the pledgor.

     (b) A person who disposes of property or who fails to make a record available for inspection by a peace officer as required by this section commits a Class B misdemeanor.

Inspection of Property

     Sec. 5. (a) The purchased property must be made available by the dealer for inspection by any police officer during regular business hours while the property is in the dealer's possession.

     (b) Information obtained under this section is confidential except for use in a criminal investigation or prosecution or a civil court proceeding.

Purchases at Temporary Locations

     Sec. 6. (a) A dealer who conducts business from a temporary location may not engage in business of buying precious metal or used items made of precious metal unless the person has filed a registration statement with the department within a 12-month period at least 30 days preceding the date on which each purchase is made and the person has filed, within the same period, a copy of the registration statement with the local law enforcement agency of the municipality in which the temporary location is situated or, if the temporary location is not situated in a municipality, with the local law enforcement agency of the county in which the temporary location is situated. A registration statement must set forth:

     (1) the name and address of the person;

     (2) the location where business is to be conducted; and

     (3) other relevant information required by the department.

     (b) If the dealer is an association or corporation, the statement must set forth the name and address of each member of the association or each officer and director of the corporation, respectively.

     (c) A dealer who fails to file a registration statement in violation of this section commits a Class B misdemeanor.

Purchase of Melted Items

     Sec. 7. (a) A dealer, in the course of business, may not purchase an object that is formed as the result of the melting of crafted precious metal unless the object is purchased from a manufacturer of or a regular dealer in crafted precious metal.

     (b) A person who purchases an object in violation of this section commits a Class B misdemeanor.

Necessity of Compliance with Other Law or Ordinance

     Sec. 8. Nothing in this Act excuses noncompliance with another state law or city ordinance covering the reporting, holding, or releasing of crafted precious metal.

Effect of Act upon Enactment, Amendment, or Enforcement of Local Ordinance

     Sec. 9. This Act does not prohibit enactment, amendment, or enforcement by any city of any local ordinance relating to a dealer and does not supersede any city ordinance except to the extent that an ordinance does not require any reporting for transactions involving crafted precious metal.

Application of Act

     Sec. 10. (a) This Act applies only to the crafted precious metals that have been sold or used primarily for personal, family, or household purposes. This Act does not apply to any person whose purchases and sales of precious metals and products made thereof are merely incidental to its business of extracting, recovering, or salvaging precious metals from industrial by-products and industrial waste products nor does this Act apply to dental, pharmaceutical, or medical applications of crafted precious metals.

     (b) This Act does not apply to crafted precious metal that has been:

     (1) acquired in good faith in a transaction involving the stock in trade of another dealer who previously made the reports required by this Act concerning the crafted precious metal included in the transaction if:

     (A) the selling dealer delivers to the acquiring dealer a written document that states that the reports have been made;

     (B) the acquiring dealer submits a copy of the statement to the chief of police of the city or the sheriff of the county where the selling dealer is located; and

     (C) each dealer involved in the transaction retains a copy of the statement required by this subdivision until the third anniversary of the date of the transaction;

     (2) acquired in a nonjudicial sale, transfer, assignment, assignment for the benefit of creditors, or consignment of the assets or stock in trade, in bulk, or a substantial part of those assets, of an industrial or commercial enterprise, other than a dealer, for the voluntary dissolution or liquidation of the seller's business, or for disposing of an excessive quantity of personal property, or property that has been acquired in a nonjudicial sale or transfer from an owner other than a dealer, his entire household of personal property, or a substantial part of that property, if:

     (A) the dealer gives written notice to the chief of police of the city or the sheriff of the county where the dealer's business is located that exemption from reporting is being claimed under this subdivision; and

     (B) the dealer retains in his place of business, until the third anniversary of the date of the transaction, a copy of the bill of sale, receipt, inventory list, or other transfer document as a record which shall be made available for inspection by any peace officer;

     (3) acquired in a sale made by any public officer in his official capacity as a trustee in bankruptcy, executor, administrator, receiver, or public official acting under judicial process or authority, or acquired in a sale made on the execution of, or by virtue of, any process issued by a court;

     (4) acquired in good faith as part or complete payment for other crafted precious metal by a person, partnership, firm, or corporation whose principal business is primarily that of selling directly to the consumer crafted precious metal that has not been subject to a prior sale;

     (5) acquired as surplus property from the United States or a state, subdivision of a state, or municipal corporation; or

     (6) reported by a dealer as an acquisition or a purchase, or reported as destroyed or otherwise disposed of, to:

     (A) a state agency in accordance with another law of this state; or

     (B) a city or county office or agency in accordance with another law of this state or a city ordinance.

     (7) acquired by a person licensed and regulated under the Texas Pawnshop Act (Article 5069–51.01 et seq., Vernon's Texas Civil Statutes).

Acts 1981, 67th Leg., p. 2147, ch. 500, §§ 1 to 10, eff. Sept. 1, 1981. Secs. 3, 4 amended by Acts 1983, 68th Leg., p. 5063, ch. 918, § 1, eff. Sept. 1, 1983; Sec. 4A added by Acts 1983, 68th Leg., p. 5069, ch. 918, § 2, eff. Sept. 1, 1983; Secs. 5, 6, 10 amended by Acts 1983, 68th Leg., p. 5063, ch. 918, § 1, eff. Sept. 1, 1983.

Art. 9009b. Metals recycling activities; transactions involving lead-acid batteries, fuel tanks, or PCB-containing capacitors

Definitions

     Sec. 1. In this article:

     (1) "Metals recycling activity" means any business that is predominantly engaged in:

     (A) performing the manufacturing process by which scrap, used, or obsolete ferrous or nonferrous metals are converted into raw material products consisting of prepared grades and having an existing or potential economic value, by methods other than the exclusive use of hand tools, including processing, sorting, cutting, classifying, cleaning, baling, wrapping, shredding, shearing, or changing the physical form of those metals; or

     (B) the use of those raw material products in the manufacture of producer or consumer goods.

     (2) "Motor vehicle" has the meaning assigned by Section 2(b), Uniform Act Regulating Traffic on Highways (Article 6701d, Vernon's Texas Civil Statutes).

     (3) "PCB-containing capacitor" means a capacitor that contains polychlorinated biphenyls and is regulated under the federal Toxic Substances Control Act (15 U.S.C. Section 2601 et seq.).

     (4) "Person" means an individual, corporation, partnership, sole proprietorship, or other business entity.

Transactions involving lead-acid batteries, fuel tanks, or PCB-containing capacitors

     Sec. 2. (a) A person may not sell, convey, or otherwise transfer to a metals recycling activity a lead-acid battery, fuel tank, or PCB-containing capacitor that is included with other types of scrap, used, or obsolete metals without first obtaining from the metals recycling activity to which the lead-acid battery, fuel tank, or PCB-containing capacitor is being sold, conveyed, or transferred a written and signed acknowledgment that the scrap, used, or obsolete metals include one or more lead-acid batteries, fuel tanks, or PCB-containing capacitors.

     (b) A person may not sell, convey, or otherwise transfer to a metals recycling activity any of the following that contain or enclose a lead-acid battery, fuel tank, or PCB-containing capacitor or of which a lead-acid battery, fuel tank, or PCB-containing capacitor is a part:

     (1) a motor vehicle;

     (2) a motor vehicle that has been junked, flattened, dismantled, or changed so that it has lost its character as a motor vehicle;

     (3) an appliance; or

     (4) any other item of scrap, used, or obsolete metal.

     (c) A person may not sell, convey, or otherwise transfer to a metals recycling activity a motor vehicle or a motor vehicle that has been junked, flattened, dismantled, or changed so that it has lost its character as a motor vehicle if the motor vehicle includes, contains, or encloses a tire or scrap tire. This subsection does not apply to the sale, conveyance, or transfer of a motor vehicle or a junked, flattened, dismantled, or changed motor vehicle from another state.

Exemptions

     Sec. 3. This article does not apply to:

     (1) the sale, conveyance, or transfer by or on behalf of a metals recycling activity; or

     (2) the sale, conveyance, or transfer of a lead-acid battery, fuel tank, or PCB-containing capacitor that is not:

     (A) included with other types of scrap, used, or obsolete metals; or

     (B) contained or enclosed in, or a part of:

     (i) a motor vehicle;

     (ii) a motor vehicle that has been junked, flattened, dismantled, or changed so that it has lost its character as a motor vehicle;

     (iii) an appliance; or

     (iv) any other item of scrap, used, or obsolete metal.

Notification and posting

     Sec. 4. A metals recycling activity shall post in a conspicuous location a notice that is readily visible to a person selling materials to the metals recycling activity. The notice must be no smaller than 24 inches horizontally by 18 inches vertically and must contain the following language:

TEXAS LAW PROHIBITS:

     1. THE SALE OF A WHOLE, FLATTENED, OR JUNKED MOTOR VEHICLE, AN APPLIANCE, OR ANY OTHER SCRAP METAL ITEM CONTAINING A LEAD–ACID BATTERY, FUEL TANK, OR PCB–CONTAINING CAPACITOR; AND

     2. THE SALE OF LEAD–ACID BATTERIES, FUEL TANKS, OR PCB–CONTAINING CAPACITORS INCLUDED WITH OTHER SCRAP METALS WITHOUT OUR PRIOR WRITTEN ACKNOWLEDGMENT.

VIOLATION OF THIS LAW IS A MISDEMEANOR.

Criminal penalty

     Sec. 5. A person who violates this article is guilty of a misdemeanor and on conviction is punishable by a fine of not more than $1,000, by confinement in the county jail for not more than 60 days, or by both fine and confinement.

Added by Acts 1991, 72nd Leg., ch. 703, § 4, eff. Aug. 26, 1991. Sec. 2(c) amended by Acts 1995, 74th Leg., ch. 317, § 24, eff. Sept. 1, 1995.

Art. 9010. Peddling of printed matter by deaf or mute persons

     It shall be unlawful for any person to peddle or use a finger alphabet card or other printed matter stating in effect that the person is deaf and/or mute, in a manner calculated to play upon the sympathy of another in the solicitation of a contribution or donation. Any person violating any provision hereof shall be deemed guilty of a misdemeanor and upon conviction shall be punished by imprisonment in the county jail for not more than sixty (60) days or by a fine of not less than Ten Dollars ($10) nor more than Fifty Dollars ($50), or by both imprisonment and fine.

Acts 1959, 56th Leg., p. 1066, ch. 487, § 1.

Art. 9020. Regulation of Invention Development Services Act

Short Title

     Sec. 1. This Act may be cited as the Regulation of Invention Development Services Act.

Definitions

     Sec. 2. In this Act:

     (1) "Invention development services" means any act done by or for an invention developer for the procurement or attempted procurement by the invention developer of a licensee or buyer of an intellectual property right in an invention. The term includes the evaluation, perfecting, marketing, brokering, or promoting of an invention, a patent search, and preparation or prosecution of a patent application by a person not registered to practice before the U.S. Patent and Trademark Office.

     (2) "Invention" means a discovery, process, machine, design, formulation, product, concept, or idea, or any combination of these, whether patentable or not.

Customer

     Sec. 3. For the purposes of this Act, a customer is:

     (1) an individual who enters into a contract with an invention developer for invention development services; or

     (2) a firm, partnership, corporation, or other entity that enters into a contract with an invention developer for invention development services and that is not purchasing those services as an adjunct to the traditional commercial enterprises in which it engages as a business.

Invention Developer

     Sec. 4. For the purposes of this Act, an invention developer is an individual, firm, partnership, or corporation, or an agent, employee, officer, partner, or independent contractor of one of those entities, that offers to perform or performs invention development services for a customer and that is not:

     (1) a department or agency of federal, state, or local government;

     (2) a nonprofit, charitable, scientific, or educational organization, qualified under the Texas Non-Profit Corporation Act (Article 1396–1.01 et seq., Vernon's Texas Civil Statutes) or described by Section 170(b)(1)(a) of the Internal Revenue Code of 1954, as amended;

     (3) an attorney acting within the scope of the attorney's professional license;

     (4) a person registered before the U.S. Patent and Trademark Office acting within the scope of that person's professional license; or

     (5) a person, firm, corporation, association, or other entity that does not charge a fee, including reimbursement for expenditures made or costs incurred by the entity, for invention development services other than payment made from a portion of the income received by a customer by virtue of acts performed by the entity.

Contracting Requirements

     Sec. 5. (a) Each contract for invention development services by which an invention developer undertakes invention development services for a customer is subject to this Act. The contract must be in writing and the invention developer shall give a copy of the contract to the customer at the time the customer signs the contract.

     (b) If it is the invention developer's normal practice to seek more than one contract in connection with an invention or if the invention developer normally seeks to perform services in connection with an invention in more than one phase with the performance of each phase covered in one or more subsequent contracts, the invention developer shall give to the customer at the time the customer signs the first contract:

     (1) a written statement describing that practice; and

     (2) a written summary of the developer's normal terms, if any, of subsequent contracts, including the approximate amount of the developer's normal fees or other consideration, if any, that may be required from the customer.

     (c) For the purposes of this section, delivery of a promissory note, check, bill of exchange, or negotiable instrument of any kind to the invention developer or to a third party for the benefit of the invention developer irrespective of the date or dates appearing in that instrument is payment.

     (d) Notwithstanding any contractual provision to the contrary, payment for invention development services may not be required, made, or received before the fourth working day after the day on which the customer receives a copy of the contract for invention development services signed by the invention developer and the customer.

     (e) Until the payment for invention development services is made, the parties to a contract for invention development services have the option to terminate the contract. The customer may exercise the option by refraining from making payment to the invention developer. The invention developer may exercise the option to terminate by giving to the customer a written notice of its exercise of the option. The written notice becomes effective on its receipt by the customer.

Standard Provisions for Cover Notice

     Sec. 6. (a) A contract for invention development services must have a conspicuous and legible cover sheet attached. The cover sheet must set forth:

     (1) the name, home address, office address, and local office address of the invention developer; and

     (2) the following notice printed in bold-faced type of not less than 10-point size:

     THIS CONTRACT BETWEEN YOU AND AN INVENTION DEVELOPER IS REGULATED BY THE STATE OF TEXAS' REGULATION OF INVENTION DEVELOPMENT SERVICES ACT. YOU ARE NOT PERMITTED OR REQUIRED TO MAKE ANY PAYMENTS UNDER THIS CONTRACT UNTIL FOUR (4) WORKING DAYS AFTER YOU SIGN THIS CONTRACT AND RECEIVE A COMPLETED COPY OF IT.

     IF YOU ASSIGN EVEN A PARTIAL INTEREST IN THE INVENTION TO THE INVENTION DEVELOPER, THE INVENTION DEVELOPER MAY HAVE THE RIGHT TO SELL OR DISPOSE OF THE INVENTION WITHOUT YOUR CONSENT AND MAY NOT HAVE TO SHARE THE PROFITS WITH YOU.

     THE TOTAL NUMBER OF CUSTOMERS WHO HAVE CONTRACTED WITH THE INVENTION DEVELOPER SINCE (year) IS (number) . THE TOTAL NUMBER OF CUSTOMERS KNOWN BY THIS INVENTION DEVELOPER TO HAVE RECEIVED, BY VIRTUE OF THIS INVENTION DEVELOPER'S PERFORMANCE, AN AMOUNT OF MONEY IN EXCESS OF THE AMOUNT PAID BY THE CUSTOMER TO THIS INVENTION DEVELOPER IS (number) .

     YOU ARE ENCOURAGED TO CONSULT WITH A QUALIFIED ATTORNEY BEFORE SIGNING THIS CONTRACT. BY PROCEEDING WITHOUT THE ADVICE OF A QUALIFIED ATTORNEY, YOU COULD LOSE ANY RIGHTS YOU MIGHT HAVE IN YOUR IDEA OR INVENTION.

     (b) The invention developer shall complete the cover sheet with the proper information to be provided in the blanks. In the first blank the invention developer shall enter the year that the invention developer began business or the effective date of this Act. The numbers entered in the last two blanks of the cover notice may be rounded to the nearest 100 and need not include those who have contracted with the invention developer during the three calendar months immediately preceding the date of the contract. If the number to be inserted in the third blank is zero, it must be so stated.

     (c) The cover notice may not contain anything in addition to the information required by Subsection (a) of this section.

Reports to Customer Required

     Sec. 7. For each contract for invention development services, the invention developer, at least once each calendar quarter during the term of the contract, shall deliver to the customer at the address specified in the contract a written report that identifies the contract and that sets forth:

     (1) a full, clear, and concise description of the services performed to the date of the report and of the services to be performed;

     (2) the name and address of each person, firm, or corporation to whom the subject matter of the contract has been disclosed, the reason for each disclosure, the nature of the disclosure, and copies of all responses received as a result of those disclosures.

Mandatory Contract Terms

     Sec. 8. (a) A contract for invention development services shall set forth in bold-faced type of not less than 10-point size:

     (1) the terms and conditions of payment and contract termination rights required by Section 5 of this Act;

     (2) a full, clear, and concise description of the specific acts or services that the invention developer undertakes to perform for the customer;

     (3) a statement as to whether the invention developer undertakes to construct, sell, or distribute one or more prototypes, models, or devices embodying the customer's invention;

     (4) the full name and principal place of business of the invention developer;

     (5) the name and principal place of business of any parent, subsidiary, or affiliated company that may engage in performing any of the invention development services;

     (6) a statement of estimated or projected customer earnings and a description of the data on which the estimation or projection is based if the invention developer makes an oral or written representation of estimated or projected customer earnings;

     (7) the name and address of the custodian of all records and correspondence pertaining to the invention development services for which the contract is made;

     (8) a statement that the invention developer is required to maintain all records and correspondence relating to performance of the invention development services for that customer until the second anniversary of the date of the expiration of the contract for invention development services and that on seven days' written notice the invention developer will make the invention development services records and correspondence available to the customer or the customer's representative for review and copying at the customer's reasonable expense on the invention developer's premises during normal business hours; and

     (9) a statement setting forth a time schedule for performance of the invention development services, including an estimated date by which performance of the invention development services is expected to be completed.

     (b) To the extent that the description of specific acts or services required by Subsection (a)(2) of this section gives the invention developer discretion in determining which acts or services will be performed, the invention developer is a fiduciary.

Remedies

     Sec. 9. (a) A contract for invention development services that does not substantially comply with this Act is voidable at the option of the customer. A contract for invention development services entered into in reliance on any false, fraudulent, or misleading information, representation, notice, or advertisement of the invention developer is voidable at the option of the customer. Any waiver by the customer of any provision of this Act is contrary to public policy and is void.

     (b) A customer who has been injured by a violation of this Act by an invention developer, by a false or fraudulent statement, representation, or omission of material fact by an invention developer, or by failure of an invention developer to make all disclosures required by this Act may recover in a civil action against the invention developer:

     (1) court costs;

     (2) attorney's fees; and

     (3) the amount of actual damages, if any, sustained by the customer or $1,000, whichever is greater.

     (c) Alternatively, any violation of this Act by an invention developer, or omission of material fact by an invention developer, or failure of an invention developer to make all disclosures required by this Act constitutes a deceptive trade practice under Chapter 17 of the Business & Commerce Code. Remedies available under Subsection (b) of this section are mutually exclusive to those provided under this Subsection (c) in conformance with Section 17.43 of the Business & Commerce Code, as amended.

     (d) For the purpose of this section, substantial violation of any provision of this Act by an invention developer or execution by the customer of a contract for invention development services in reliance on a false or fraudulent statement, representation, or material omission establishes a rebuttable presumption of injury.

Enforcement; Civil Penalty; Restraint of Violations

     Sec. 10. The attorney general shall enforce this Act. The attorney general may recover a civil penalty not to exceed $2,000 for each violation of this Act and may seek equitable relief to restrain a violation of this Act.

Financial Requirements

     Sec. 11. (a) Except as provided by Subsection (c) of this section, each invention developer rendering or offering to render invention development services in this state shall maintain a bond issued by a surety company authorized to do business in this state. The principal sum of the bond must be at least five percent of the invention developer's gross income from the invention development business in this state during the invention developer's last fiscal year or $25,000, whichever is greater. The invention developer shall file a copy of the bond with the secretary of state before the day on which the invention developer begins business in this state. Before the 91st day after the last day of the invention developer's fiscal year, the invention developer shall change the amount of the bond if necessary to conform with the requirements of this section.

     (b) The bond required by Subsection (a) of this section must be in favor of the State of Texas for the benefit of any person who, after entering into a contract for invention development services with an invention developer, is damaged by fraud, dishonesty, or failure to provide the services of the invention developer in performance of the contract. Any person claiming against the bond may maintain an action at law against the invention developer and the surety. The aggregate liability of the surety to all persons for all breaches of conditions of the bond required by this subsection is limited to the amount of the bond.

     (c) Instead of furnishing the bond required by Subsection (a) of this section, the invention developer may deposit with the secretary of state a cash deposit equal to the amount of the bond required by this section. The cash deposit may be satisfied by:

     (1) certificates of deposit payable to the secretary of state issued by banks doing business in this state and insured by the Federal Deposit Insurance Corporation;

     (2) investment certificates of share accounts assigned to the secretary of state and issued by a savings and loan association doing business in this state and insured by the Federal Savings and Loan Insurance Corporation;

     (3) bearer bonds issued by the United States government or by this state; or

     (4) cash deposited with the secretary of state.

Effect on Other Laws

     Sec. 12. This Act does not annul or limit any obligation, right, or remedy that is applicable or available under the law of this state.

Acts 1981, 67th Leg., p. 260, ch. 108, eff. May 7, 1981.

Art. 9022. Processing fee by holder of dishonored check

     (a) The holder of a check or its assignee, agent, representative, or any other person retained by the holder to seek collection of the face value of the dishonored check on return of the check to the holder following its dishonor by a payor may charge the drawer or endorser a reasonable processing fee, which shall not exceed $25. A person may not charge a processing fee to a drawer or endorser under this subsection if the fee has been collected under Article 102.007(e) or Article 102.0071, Code of Criminal Procedure. If a processing fee has been collected under this subsection and the holder subsequently receives a fee collected under Article 102.007(e) or Article 102.0071, Code of Criminal Procedure, the holder shall immediately refund the fee previously collected from the drawer or endorser. Notwithstanding any other provisions of law, a loan agreement made under Chapter 342, Finance Code, may provide that on return of a dishonored check given in payment under the agreement, the holder may charge the obligor under the agreement the processing fee authorized by this Act, and the fee may be added to the unpaid balance owed under the agreement, except that interest may not be charged on the fee during the term of the agreement.

     (b) Nothing herein shall be construed as affecting any right or remedy to which the holder of a check may be entitled under any rule, regulation, written contract, judicial decision, or other statute.

Acts 1983, 68th Leg., p. 3873, ch. 617, § 1, eff. Aug. 29, 1983. Subsec. (a) amended by Acts 1987, 70th Leg., ch. 687, § 1, eff. June 18, 1987; amended by Acts 1991, 72nd Leg., ch. 396, § 1, eff. Sept. 1, 1991; amended by Acts 1997, 75th Leg., ch. 1396, § 46, eff. Sept. 1, 1997; amended by Acts 1999, 76th Leg., ch. 62, § 7.102, eff. Sept. 1, 1999.

Art. 9023d. Disposal of Computer Equipment by Charitable Organization

     (a) In this article:

     (1) "Computer equipment" includes computers, telecommunications devices and systems, automated information systems, and peripheral devices and hardware that are necessary to the efficient installation and operation of that equipment, but does not include computer software.

     (2) "Charitable organization" has the meaning assigned by Section 84.003, Civil Practice and Remedies Code.

     (b) Except as provided by Subsections (c) and (d) of this article, a charitable organization that expends funds received from the state, whether by appropriation, grant, or otherwise, to purchase computer equipment may not dispose of or discard the equipment before the fourth anniversary of the date the organization purchased the equipment.

     (c) This article does not prohibit:

     (1) the sale or trade of computer equipment; or

     (2) the disposal of equipment that is not operational.

     (d) A charitable organization may dispose of computer equipment purchased with state funds within the four-year period after the date of purchase by donating the equipment to another charitable organization.

     (e) This article applies only to computer equipment that a charitable organization purchases for at least $500.

     (f) The comptroller shall adopt rules to implement this article.

Added by Acts 1997, 75th Leg., ch. 1087, § 1, eff. Sept. 1, 1997.

Art. 9023e. Telephone Solicitations by Charitable Organizations

Scope of Act

     Sec. 1. The solicitation of contributions from persons in this state shall be considered to be engaging in telephone solicitation in Texas, regardless of where the solicitation originates.

Definitions

     Sec. 2. In this Act:

     (1) "Charitable organization" means a person, other than a governmental law enforcement agency or organization, who solicits contributions or funds and is or holds himself, herself, or itself out to be established or operating for a charitable purpose relating to law enforcement, including nongovernmental law enforcement organizations, nongovernmental law enforcement publications, and survivors of law enforcement officers who are killed in the line of duty.

     (2) "Commercial telephone solicitor" means a person who is retained by a charitable organization to solicit contributions or funds by telephone, whether done individually or through another person under the direction of the commercial telephone solicitor. The term does not include a bona fide employee, officer, director, or volunteer of a charitable organization.

     (3) "Contribution" means the promise to give or the gift of money, credit, property, financial assistance, or other thing of any kind or value, except volunteer services. The term does not include bona fide fees, dues, or assessments paid by members if membership is not conferred solely as consideration for making a contribution in response to a telephone solicitation.

     (4) "Knowingly" means with actual awareness, but actual awareness may be inferred if objective manifestations indicate that a person acted with actual awareness.

     (5) "Person" means an individual, partnership, corporation, association, or other legal entity.

     (6) "Telephone solicitation" means the use of a telephone to solicit another person to make a charitable contribution to an organization.

Register To Be Maintained

     Sec. 3. (a) The attorney general shall establish and maintain a register of charitable organizations subject to this Act.

     (b) All documents required to be filed with the attorney general under this Act are public information and shall be available to the public under the open records law, Chapter 552, Government Code, except those documents that identify the donors of a charitable organization, which information is confidential and is not subject to disclosure.

Registration

     Sec. 4. (a) The attorney general shall maintain a registry of charitable organizations that submit to the attorney general completed registration statements that contain:

     (1) the legal name and each assumed name, the mailing address and street address, and each telephone number and facsimile number of each office, chapter, local unit, branch, and affiliate of the charitable organization;

     (2) the employer identification number of the charitable organization;

     (3) the name, title, address, and telephone number of each officer, director, and executive director or other chief operating officer of the charitable organization;

     (4) the name of each officer, director, or employee who is compensated by the charitable organization or who has custody and control of funds of the charitable organization and who has been convicted of or pleaded nolo contendere to a misdemeanor involving fraud or the theft, misappropriation, misapplication, or misuse of property of another, or any felony, including the offense and the state, court, and date of each conviction or plea of nolo contendere;

     (5) the date the charitable organization was incorporated and the state of incorporation or, if not incorporated, the type of organization and the date established; the day and month on which the organization's fiscal year ends; and whether the organization is eligible to receive tax-deductible contributions under Section 170, Internal Revenue Code of 1986 (26 U.S.C. Section 170);

     (6) a statement as to whether the organization has applied for or been granted tax exempt status by the Internal Revenue Service and, if so, the date of the application, the date the exemption was granted or denied, the Internal Revenue Code section on which the application was based, and a statement as to whether or when the tax exemption has ever been denied, revoked, or modified;

     (7) the date the organization began doing business in this state and the name and address of the organization's registered agent in this state;

     (8) a statement of the charitable organization's charitable purposes and a list of the programs for which funds are solicited;

     (9) a statement that includes:

     (A) the names, addresses, and telephone numbers of the organization's accountants and auditors and the method of accounting used;

     (B) a statement that the charitable organization has attempted in good faith to comply with all Texas county and municipal ordinances regarding telephone solicitation that have been filed with the attorney general or, if none apply, a statement to that effect;

     (C) for charitable organizations that engage the services of commercial telephone solicitors, the name and address of each commercial telephone solicitor engaged in the preceding 12 months, as well as written confirmation from the commercial telephone solicitor that it has complied with all state and local registration laws;

     (D) the amount paid to commercial telephone solicitors during the preceding 12 months;

     (E) the total contributions received during the preceding 12 months; and

     (F) the total fund-raising costs during the preceding 12 months, computed pursuant to generally accepted accounting principles;

     (10) a copy of the charitable organization's most recently filed Internal Revenue Service Form 990 and other federal tax returns, including all supplements, amendments, and attachments to those returns and requests for extensions to file those returns or, if the charitable organization does not file federal tax returns:

     (A) a statement as to the reason none is filed; and

     (B) the charitable organization's most recent financial statements, including audited financial statements, if any have been prepared; and

     (11) a sworn statement verifying that the information contained in the registration statement and all attachments to the statement are true, correct, and complete to the best of the affiant's knowledge.

     (b) A charitable organization shall file its initial registration statement before the 10th working day preceding the date on which the organization begins telephone solicitation in this state.

     (c) Registration expires on the 15th day of the fifth month after the last day of a charitable organization's fiscal year. Renewal registration statements shall be filed on the same forms required for initial registration statements and must include the name and employer identification number of the charitable organization and any changes to the information previously submitted to the attorney general. For items on which there is no change from the previous year's registration statement, "no change" may be indicated.

     (d) A filing fee not to exceed $50 must accompany the initial registration statement. A $50 filing fee must accompany all renewal registration statements.

     (e) The registration statements shall be submitted on forms prescribed or approved by the attorney general.

     (f) A volunteer that has been authorized to solicit on behalf of a charitable organization is not required to register under this Act.

Bond

     Sec. 5. A commercial telephone solicitor shall post a surety bond with the secretary of state in the amount of $50,000 issued by a surety company authorized to do business in this state.

Notification of Noncompliance

     Sec. 6. (a) A charitable organization that is not in compliance with this Act shall be notified of noncompliance by the attorney general by first class mail at the organization's last reported address. Noncompliance includes failure to file any documents required by this Act or the filing of incomplete or inaccurate documents.

     (b) A charitable organization violates this Act if the organization:

     (1) fails to file complete documents within 30 days after the date the notice required by Subsection (a) of this section has been mailed; or

     (2) knowingly files materially inaccurate documents.

Recordkeeping; Audit Powers of Attorney General

     Sec. 7. (a) Each charitable organization required to file a registration statement shall keep true books and records as to its activities within this state in a form to enable it to accurately provide the information required by this Act. The books and records shall be retained for a period of at least three years after the end of the period to which the registration statement relates. All books and records of a charitable organization shall be made available for inspection and copying by authorized personnel of the attorney general on written request by authorized personnel of the attorney general.

     (b) A charitable organization shall make available the information requested by authorized personnel of the attorney general at the organization's principal place of business within 10 working days of the date of the request, or at a time and place as may be agreed.

     (c) The authority established by this section is in addition to other statutory or common law audit or investigative authority of the attorney general.

Registration Does Not Imply Endorsement

     Sec. 8. Registration under this Act does not imply endorsement by this state or the attorney general, and charitable organizations are prohibited from stating or implying to the contrary.

Remedies

     Sec. 9. (a) The attorney general may institute an action for failure to fully and accurately comply with this Act and may obtain injunctive relief to restrain a person from continuing a violation, cancellation or suspension of the registration, an order restraining the person from doing business in this state while violating this Act, a civil penalty of not more than $25,000 per violation, or injunctive relief and a civil penalty. A person who violates an injunction issued under this section is liable to the state for a civil penalty of not less than $100,000.

     (b) The remedies authorized by this Act are not exclusive but are in addition to any other procedure or remedy provided for by other statutory or common law.

     (c) In any proceeding successfully prosecuted by the attorney general under this Act, the court may allow the attorney general to recover civil penalties and the reasonable costs, expenses, and attorney's fees incurred in bringing the suit.

Dedication of Fees and Civil Penalties

     Sec. 10. In addition to other money, all fees assessed under this Act and all recovered expenses incurred in obtaining injunctive relief and administrative and civil penalties authorized by this Act are dedicated for use by the attorney general in enforcing and administering this Act. Recovered expenses include investigative costs, witness fees, attorney's fees, and deposition expenses.

Venue

     Sec. 11. An action under this Act shall be brought in a court of competent jurisdiction in Travis County, in the county in which the charitable organization has its principal place of business or has a fixed and established place of business at the time the suit is brought, or in the county in which solicitation occurred.

Notice to Contributors; Prohibition

     Sec. 12. (a) If less than 90 percent of the contributions or funds collected by a charitable organization or commercial telephone solicitor are paid by the charitable organization or commercial telephone solicitor to a charitable organization, the commercial telephone solicitor shall notify each person solicited by telephone, before accepting a contribution or funds from the person, of the percentage of the contributions or funds that will be paid to the organization for which the contributions or funds are being solicited and the percentage that will be retained by the solicitor. This information shall also be included on any written statement mailed to the contributor.

     (b) A charitable organization or commercial telephone solicitor may not make a telephone call to solicit contributions or funds unless the call is made after 9 a.m. and before 7 p.m., Monday through Friday.

Prohibited Practices

     Sec. 13. (a) A person may not commit an unfair or deceptive act or practice in the conduct of solicitations for a charitable organization.

     (b) A person may not represent to a person solicited that a contribution is to be used to benefit the survivors of a law enforcement officer killed in the line of duty unless:

     (1) 100 percent of the contributions collected are used to benefit those survivors; or

     (2) the person solicited is informed in writing of the exact percentage of the contribution that will directly benefit those survivors.

Rules

     Sec. 14. The attorney general may adopt rules, procedures, and forms that are consistent with and necessary for the proper administration and enforcement of this Act.

Acts 1997, 75th Leg., ch. 1202, §§ 1 to 14, eff. Sept. 1, 1997.

Art. 9026a. Charges for Title Fees, Registration Fees, and Property Taxes

     (a) A person required to register under Section 152.065, Tax Code, may include in a customer agreement a separate charge for the proportionate amount of title fees, registration fees, and property taxes paid in the preceding calendar year on the person's vehicle fleet.

     (b) If a person includes a charge under Subsection (a) of this article in a customer agreement, the charge:

     (1) must be included on a nondiscriminatory basis; and

     (2) shall be collected in each agreement other than an agreement that is exempt from a tax imposed under Section 152.026, Tax Code.

     (c) A person commits an offense if the person violates this article. An offense under this subsection is a Class A misdemeanor.

Acts 1997, 75th Leg., ch. 165, § 30.43(c), eff. Sept. 1, 1997.

Art. 9026b. Retention or Use of Certain Motor Vehicles Prohibited

     (a) An owner to whom Section 152.065, Tax Code, applies is prohibited from retaining for use or using a motor vehicle that has been issued a certificate of title under Section 501.0923, Transportation Code, for a usual commercial purpose of that owner.

     (b) A person commits an offense if the person violates Subsection (a) of this article. An offense under this subsection is a Class A misdemeanor.

     (c) In this article, "certificate of title," "owner," and "motor vehicle" have the meanings assigned by Section 501.002, Transportation Code.

Acts 1997, 75th Leg., ch. 165, § 30.43(c), eff. Sept. 1, 1997.

Art. 9026c. Rental Car Damage Waiver

Definitions

     Sec. 1. In this article:

     (1) "Rental company" means a person or other entity that is in the business of renting private passenger vehicles to the public for 30 days or less. The term does not include an individual or other entity who holds a license issued by the Motor Vehicle Board of the Texas Department of Transportation under the Texas Motor Vehicle Commission Code (Article 4413(36), Vernon's Texas Civil Statutes) and whose primary business activity is not the renting of private passenger automobiles.

     (2) "Renter" means a person or other entity that obtains the use of a private passenger vehicle from a rental company under terms of a rental agreement.

     (3) "Rental agreement" means an agreement for 30 days or less setting forth the terms and conditions governing the use of a private passenger vehicle provided by a rental company.

     (4) "Damage" means damage to or loss of a rented vehicle, including theft and loss of use, and any cost or expense incident to the damage or loss, including storage, impound, towing, and administrative charges, regardless of fault involved in the damage or loss.

     (5) "Private passenger vehicle" means a motor vehicle of the private passenger type, including a passenger van, that is primarily intended for private use.

     (6) "Authorized driver" means:

     (A) the renter;

     (B) the renter's spouse if the spouse is a licensed driver and satisfies the rental company's minimum age requirement;

     (C) the renter's employer, employee, or coworker if the person is a licensed driver, satisfies the rental company's minimum age requirement, and at the time of the rental is engaged in a business activity with the renter;

     (D) any person who is expressly listed by the rental company on the rental agreement as an authorized driver; and

     (E) any person driving directly to a medical or police facility under circumstances reasonably believed to constitute an emergency and who is a licensed driver.

     (7) "Damage waiver" means a rental company's agreement not to hold an authorized driver liable for all or a part of any damage to a rented vehicle.

Prohibited Practices

     Sec. 2. (a) A rental company may not sell a damage waiver unless the renter agrees to the damage waiver in writing at or before the time the rental agreement is executed.

     (b) A rental company may not void a damage waiver except for one or more of the following reasons:

     (1) the damage is caused intentionally by an authorized driver or as a result of wilful and wanton misconduct of an authorized driver;

     (2) the damage arises out of the use of the vehicle while under the influence of alcohol, illegal drugs, a controlled substance, or any other intoxicant that impairs driving ability;

     (3) the rental company entered into the rental transaction based on fraudulent information supplied by the renter;

     (4) the damage arises out of the use of the vehicle while engaged in the commission of a crime other than a traffic infraction;

     (5) the damage arises out of the use of the vehicle to carry persons or property for hire, to push or tow anything, to engage in a speed contest, or for driver's training;

     (6) the damage arises out of the use of the vehicle by a person other than an authorized driver; or

     (7) the damage arises out of the use of the vehicle outside the continental United States and the use is not specifically authorized by the rental agreement.

Disclosure Notice Requirements

     Sec. 3. (a) A rental company shall provide each renter who purchases a damage waiver that is not included in the base rental rate the following disclosure notice, which must be in at least 10-point type:

NOTICE: Your rental agreement offers, for an additional charge, an optional waiver to cover all or a part of your responsibility for damage to or loss of the vehicle. Before deciding whether to purchase the waiver, you may wish to determine whether your own automobile insurance or credit card agreement provides you coverage for rental vehicle damage or loss and determine the amount of the deductible under your own insurance coverage. The purchase of the waiver is not mandatory. The waiver is not insurance.

     (b) In addition to the notice provided to each renter who purchases a damage waiver, a rental company shall post in a conspicuous location where the waiver is being offered the following notice:

Notice to Texas Residents Regarding Damage Waivers

The Texas personal automobile insurance policy provides coverage with NO DEDUCTIBLE for the legal liabilities of the policyholder in connection with the loss of or damage to a rented vehicle, except for damages caused intentionally, up to the maximum of the property damage limits under your liability coverage. If you file a claim under your personal automobile insurance policy, your insurance company may choose to nonrenew your policy at your renewal date, but may do so only if you are at fault for the claim.

Mandatory Charges

     Sec. 4. (a) In this section, "mandatory charge" means any charge, surcharge, or fee in addition to the base rental rate for an item or service provided in connection with a rental transaction that the renter does not have the option of avoiding or declining and that is not otherwise imposed by law.

     (b) A rental agreement containing a mandatory charge must prominently display and fully disclose the charge:

     (1) separately on the face of the agreement; and

     (2) in all of the rental company's price advertising, price displays, price quotes, and price offers, including displays in computerized reservation systems.

     (c) A rental company may not impose or require the purchase of a damage waiver as a mandatory charge.

Prohibited Representations

     Sec. 5. No oral or written representations shall be made by any employee or agent of the rental company which contradict the provisions of this article. No coercive language or action shall be used by any employee or agent of the rental company in an attempt to persuade a renter to purchase the damage waiver. For the purposes of this section, if the renter has declined the damage waiver, further statements or questions by an employee or agent of the rental company making reference to the damage waiver, other than a statement that the waiver has been declined made in conjunction with a review of the rental agreement, shall be deemed coercive.

Penalty

     Sec. 6. (a) A rental company that violates this article is subject to a civil penalty in an amount of at least $500 and not to exceed $1,000 for each act of violation.

     (b) A county or district attorney or the attorney general may institute and conduct a suit in the name of the state to recover the civil penalty, injunctive relief, or both the civil penalty and injunctive relief.

     (c) Any person or entity injured or threatened with injury by a violation of this article may seek injunctive relief against any company or person who violates or threatens to violate this article.

Added by Acts 1999, 76th Leg., ch. 1046, § 1, eff. Sept. 1, 1999.

Art. 9028. Motor vehicle repair facilities; registration

Definitions

     Sec. 1. In this Act:

     (1) "Person" means an individual human being, corporation, partnership, firm, or other legal entity.

     (2) "Commission" means the Texas Water Commission.

     (3) "Executive director" means the executive director of the commission.

     (4) "Motor vehicle" means a self-propelled device with at least four wheels by which a person or property may be transported or drawn on a public street or highway, except a device exclusively on stationary rails or tracks.

     (5) "Repair facility" means a person that engages in the business of repairing or replacing the nonmechanical exterior or interior body parts of a damaged motor vehicle.

     (6) "Registrant" means a person registered under the terms of this Act.

Registration required

     Sec. 2. A repair facility shall register with the commission as provided by this Act and by rules promulgated by the commission. The repair facility shall renew the registration annually in the manner prescribed by the commission.

Information disclosed in registration

     Sec. 3. (a) The commission by rule shall promulgate a form for application for the registration required by this Act and for application for renewal of the registration required by this Act. The commission by rule shall determine the information to be disclosed on the application. The application shall be sworn and shall set forth at least the following:

     (1) each conviction of a felony, or misdemeanor for which the maximum punishment is by confinement in jail or by a fine exceeding $200, that was obtained against the applicant or a partner or officer of the applicant in the three-year period immediately preceding the date of the application;

     (2) the name and street address, and the mailing address if different from the street address, of each location at which the applicant operates a repair facility;

     (3) the name and address of each owner, partner, officer, director, or shareholder holding 10 percent or more of the outstanding shares if the applicant is a corporation;

     (4) a statement setting forth each identification number assigned by, or other evidence of compliance with the requirements of, each of the following, if applicable:

     (A) the United States Environmental Protection Agency;

     (B) the United States Occupational Safety and Health Administration;

     (C) the Texas Water Commission;

     (D) the Texas Department of Health;

     (E) the Texas Air Control Board;

     (F) the comptroller of public accounts; and

     (G) a municipal ordinance or county regulation.

     (b) A registration or a renewal of a registration shall be accompanied by a fee of $50.

Certificate of registration; expiration

     Sec. 4. On receipt of the form required by Section 3 of this Act, the executive director shall issue a certificate of registration to the applicant. A certificate of registration:

     (1) shall bear a unique number;

     (2) is valid for one year from the date of issuance;

     (3) may be renewed upon application to the executive director on a form provided by the executive director;

     (4) is not transferrable; and

     (5) is applicable only to the person whose name appears on the certificate or an employee of that person.

Renewal

     Sec. 5. Within 30 days prior to the expiration of a certificate of registration, the registrant shall apply for renewal of the license in the manner provided by this Act.

Expiration; termination; surrender

     Sec. 6. (a) The executive director may suspend or revoke a certificate of registration prior to its expiration date according to the procedures and on the grounds established pursuant to Section 7 of this Act. A certificate of registration may be terminated at any time by voluntary surrender by the registrant.

     (b) Upon the expiration, termination, or surrender of a certificate of registration, the registrant shall deliver the certificate to the executive director who shall cancel the certificate or endorse the date of expiration, termination, or surrender on the certificate.

     (c) If a certificate of registration is lost or destroyed, the registrant shall file an affidavit to that effect, and the commissioner shall, on receipt of a $25 replacement fee, issue a replacement certificate clearly identified as such on the certificate and in the records of the commission.

Revocation; suspension; rules

     Sec. 7. (a) The commission shall adopt rules establishing the grounds for suspension, revocation, or reinstatement of a certificate of registration and establishing the procedures for disciplinary actions.

     (b) Proceedings relating to the suspension or revocation of a certificate of registration issued under this Act are subject to the Administrative Procedure and Texas Register Act (Article 6252–13a, Vernon's Texas Civil Statutes).

Registration applications and certificates; maintenance of records

     Sec. 8. The executive director shall maintain, in convenient form and open to the public, all applications for registration and copies of certificates of registration and shall annually publish a list of names and addresses of persons registered with the commission under this Act, the names of all persons whose registration has been revoked, suspended, or surrendered during the period, and the specific time that the suspension, revocation, or surrender became effective.

Public display of certificate of registration

     Sec. 9. A registrant shall publicly display its current certificate of registration in its place of business in a location readily visible to a customer paying for repairs. A registrant shall also include the registrant's registration number on repair estimates, repair orders, and correspondence.

Advertising; repair charges

     Sec. 10. (a) A registrant shall include the number of its certificate assigned by the commission as provided by this Act as a part of an advertisement for motor vehicle repairs.

     (b) A registrant may not make any false or fraudulent statement in connection with any repair or attempt to collect for a repair.

Records

     Sec. 11. (a) A registrant shall maintain a record of each motor vehicle that enters the registrant's premises for the purpose of obtaining repairs. Except as provided by Subsection (b) of this section, the registrant shall include in that record at least the following information:

     (1) a description of the vehicle;

     (2) the vehicle identification number;

     (3) the date the vehicle entered the registrant's premises;

     (4) the odometer reading at the time the vehicle is received;

     (5) the name and address of the person from whom the vehicle was received; and

     (6) a signed authorization for the work to be performed on the vehicle.

     (b) The record required by Subsection (a) of this section shall be kept in a convenient place and, along with the premises of the registrant's place of business, may be inspected at any time by the executive director or an employee of the commission.

     (c) In the case of a vehicle that was towed to the registrant's repair facility without the consent of the owner of the vehicle, the information that the registrant shall maintain is the information provided by the law enforcement agency that initiated the towing process.

Violations; penalty

     Sec. 12. (a) A repair facility that fails to register as provided by this Act shall pay a civil penalty of $250. The executive director shall waive the penalty if the repair facility files proper registration within 10 days after notice of the violation.

     (b) A registrant that violates a provision of this Act is subject to a civil penalty not to exceed $100.

Applicability

     Sec. 13. This Act does not apply to a repair facility located within a county with a population of 50,000 or fewer.

Acts 1993, 73rd Leg., ch. 956, eff. Jan. 1, 1994.

Art. 9029. Federal lead-based paint abatement funds; certification program

Purpose

     Sec. 1. The purpose of this Act is to establish, pursuant to federal requirements, the eligibility of state and local governments for federal lead-based paint abatement funds.

Definitions

     Sec. 2. In this Act:

     (1) "Child-occupied facility" means a building, or part of a building, constructed before 1978 that is visited regularly by the same child, six years of age or younger, on at least two different days in any seven-day period beginning on Sunday and ending on Saturday, if each day's visit lasts at least three hours, the combined weekly visits last at least six hours, and the combined annual visits last at least 60 hours. The term includes a day-care center, preschool, or kindergarten classroom.

     (2) "Department" means the Texas Department of Health.

     (3) "Federal law and rules" means:

     (A) Title IV, Toxic Substances Control Act (15 U.S.C. Section 2681 et seq.), and the rules adopted by the United States Environmental Protection Agency under that law for authorization of state programs;

     (B) any regulations or requirements adopted by the United States Department of Housing and Urban Development regarding eligibility for grants to states and local governments; and

     (C) any other requirements adopted by a federal agency with jurisdiction over lead hazards.

     (4) "Lead-based paint activity" means inspection, testing, risk assessment, risk reduction, lead abatement project design or planning, abatement or removal, or creation of lead-based paint hazards.

     (5) "Person" means an individual, corporation, company, contractor, association, firm, partnership, joint stock company, foundation, institution, trust, society, union, or any other association of individuals.

     (6) "Target housing" means any housing constructed before 1978. The term does not include:

     (A) housing for the elderly or persons with disabilities, unless a child who is six years of age or younger resides or is expected to reside in that housing; or

     (B) a dwelling with no bedrooms.

Certification Program

     Sec. 3. (a) The department shall establish a program for certification of a person involved in a lead-based paint activity in target housing or in a child-occupied facility and for accreditation of training providers in compliance with federal law and rules. The department shall make any changes to the certification program that are consistent with this chapter and that are necessary to comply with federal law and rules relating to the program.

     (b) Rules adopted under this section must:

     (1) set minimum training requirements by accredited training providers;

     (2) set standards for lead-based paint activities in target housing that cover reliability, effectiveness, and safety;

     (3) set standards for accrediting training providers;

     (4) require the use of certified and accredited personnel in any lead-based paint activity in target housing or in a child-occupied facility;

     (5) be revised as necessary to comply with federal law and rules and to maintain eligibility for federal funding;

     (6) facilitate reciprocity and communication with other states having a certification program; and

     (7) provide for decertification, deaccreditation, and financial assurance for a person certified or accredited by the department.

     (c) The program established under this Act may not exceed the minimum program requirements of federal law and rules for authorization of a state program and receipt of federal funds by state and local governments.

     (d) The department may assess a fee to recover the cost of administering the program.

     (e) The department by rule may require a person who is involved in a lead-based paint activity in target housing or a public area that the department finds creates a public health hazard to become certified under the program established under this Act. (1) If the department adopts a rule under this subsection, it must be consistent with federal law or regulation. The department shall delay implementation of the certification requirement until the day six months after the date the rule is adopted.

Notification of Examination Results

     Sec. 3A. (a) Not later than the 30th day after the date a person takes any certification or accreditation examination under this Act, the department shall notify the person of the results of the examination.

     (b) If an examination is graded or reviewed by a testing service:

     (1) the department shall notify the person of the results of the examination not later than the 14th day after the date the department receives the results from the testing service; and

     (2) if notice of the examination results will be delayed for longer than 90 days after the examination date, the department shall notify the person of the reason for the delay before the 90th day.

     (c) The department may require a testing service to notify a person of the results of the person's examination.

     (d) If requested in writing by a person who fails a certification or accreditation examination administered under this Act, the department shall furnish the person with an analysis of the person's performance on the examination.

Rules Regarding Advertising or Competitive Bidding

     Sec. 3B. (a) The Texas Board of Health may not adopt rules restricting advertising or competitive bidding by a certified or accredited person except to prohibit false, misleading, or deceptive practices.

     (b) In its rules to prohibit false, misleading, or deceptive practices, the board may not include a rule that:

     (1) restricts the use of any medium for advertising;

     (2) restricts the use of a certified or accredited person's personal appearance or voice in an advertisement;

     (3) relates to the size or duration of an advertisement by the certified or accredited person; or

     (4) restricts the certified or accredited person's advertisement under a trade name.

Civil Penalty

     Sec. 4. (a) If it appears that a person has violated, is violating, or is threatening to violate a provision of this Act or a rule adopted or certification issued by the department under this Act, the state may file suit in the manner prescribed by Subsections (a) and (b), Section 361.224, Health and Safety Code. Venue is in the county prescribed by Section 361.227, Health and Safety Code.

     (b) A civil penalty may not exceed $2,000 for the first violation, or $10,000 for a second or subsequent violation.

Criminal Penalty

     Sec. 5. (a) A person commits an offense if the person knowingly or intentionally violates this Act or a rule adopted or certification issued under this Act and the violation results in an endangerment to the public health and safety.

     (b) An offense under this section is punishable by a fine of not more than $10,000, not more than six months imprisonment, or both.

     (c) Venue is in the county in which the violation occurs.

Administrative Penalty

     Sec. 6. The department may assess an administrative penalty of not more than $5,000 for each day of a violation of this Act or a rule adopted under this Act. The Texas Board of Health shall adopt rules relating to the assessment and collection of an administrative penalty.

Expiration Dates of Certification or Accreditation

     Sec. 6A. The Texas Board of Health by rule may adopt a system under which certifications or accreditations expire on various dates during the year. For the year in which the expiration date is changed, the department shall prorate certification or accreditation fees on a monthly basis so that each certified or accredited person pays only that portion of the certification or accreditation fee that is allocable to the number of months during which the certification or accreditation is valid. On renewal of the certification or accreditation on the new expiration date, the total certification or accreditation renewal fee is payable.

Renewal of Certification or Accreditation

     Sec. 6B. (a) A person who is otherwise eligible to renew a certification or accreditation may renew an unexpired certification or accreditation by paying the required renewal fee to the department before the expiration date of the certification or accreditation. A person whose certification or accreditation has expired may not engage in activities that require certification or accreditation until the certification or accreditation has been renewed.

     (b) A person whose certification or accreditation has been expired for 90 days or less may renew the certification or accreditation by paying to the department a renewal fee that is equal to 1˝ times the normally required renewal fee.

     (c) A person whose certification or accreditation has been expired for more than 90 days but less than one year may renew the certification or accreditation by paying to the department a renewal fee that is equal to two times the normally required renewal fee.

     (d) A person whose certification or accreditation has been expired for one year or more may not renew the certification or accreditation. The person may become recertified or reaccredited by complying with the requirements and procedures, including any examination requirements, for an original certification or accreditation.

     (e) A person who was certified or accredited in this state, moved to another state, and is currently certified or accredited and has been in practice in the other state for the two years preceding the date of application may become recertified or reaccredited without reexamination. The person must pay to the department a fee that is equal to two times the normally required renewal fee for certification or accreditation.

     (f) Not later than the 30th day before the date a person's certification or accreditation is scheduled to expire, the department shall send written notice of the impending expiration to the person at the person's last known address according to the records of the department.

Disciplinary Actions

     Sec. 6C. (a) The department shall revoke, suspend, or refuse to renew a certification or accreditation or shall reprimand a certified or accredited person for a violation of this Act or a rule of the board.

     (b) The board may place on probation a person whose certification or accreditation is suspended. If a suspension is probated, the board may require the person:

     (1) to report regularly to the department on matters that are the basis of the probation;

     (2) to limit practice to the areas prescribed by the board; or

     (3) to continue or review professional education until the person attains a degree of skill satisfactory to the board in those areas that are the basis of the probation.

Acts 1995, 74th Leg., ch. 332, eff. Aug. 28, 1995; Sec. 2 amended by Acts 1997, 75th Leg., ch. 288, § 1, eff. Sept. 1, 1997; Sec. 3(a), (b) amended by Acts 1997, 75th Leg., ch. 288, § 2, eff. Sept. 1, 1997; Sec. 3(e) added by Acts 1997, 75th Leg., ch. 288, § 3, eff. Sept. 1, 1997; Secs. 3A, 3B added by Acts 1999, 76th Leg., ch. 1411, § 21.01, eff. Sept. 1, 1999; Secs. 6A to 6C added by Acts 1999, 76th Leg., ch. 1411, § 21.02, eff. Sept. 1, 1999.

Art. 9030. Excursion train operators; certification; limitation of liability

Certification

     Sec. 1. (a) A person may apply to the comptroller for certification as an operator of an excursion train. The comptroller shall certify an applicant if the comptroller determines that the applicant will operate a passenger train that:

     (1) is primarily used for tourism or public service; and

     (2) leads to the promotion of the tourist industry in Texas.

     (b) The comptroller may not certify a person under Subsection (a) of this section unless the person files with the comptroller evidence of insurance providing coverage for liability resulting from injury to persons or damages to property in the amount of at least $5,000,000 for the operation of the train.

     (c) The comptroller may not certify an applicant under Subsection (a) of this section if the applicant or any person that owns an interest in the applicant also owns or operates a regularly scheduled passenger train service with interstate connections.

Limitation of Liability

     Sec. 2. (a) A person that is certified as an operator of an excursion train under Section 1(a) of this Act and maintains insurance in the minimum amount required under Section 1(b) of this Act is not liable for injury or damages over $5,000,000 resulting from a single occurrence.

     (b) The limitation of liability under Subsection (a) of this section applies to the person certified as an operator under Section 1(a) of this Act, the owner of equipment used by the excursion train, the owner of track used by the excursion train, and the host carrier.

     (c) The limitation of liability under Subsection (a) of this section does not apply if:

     (1) the injury or damages result from intentional, malicious, or grossly negligent conduct; or

     (2) at the time of the injury or damages the operator of the excursion train:

     (A) failed to maintain insurance as required under Section 1(b) of this Act; or

     (B) failed to comply with Section 5 of this Act.

Application

     Sec. 3. An application made under Section 1 of this Act must include:

     (1) the name and address of each person who owns an interest of at least 10 percent in the applicant;

     (2) an address in this state at which the excursion train is based;

     (3) an operations plan including the route to be used and a schedule of operations and stops along the route; and

     (4) evidence of insurance in an amount that meets the requirements of Section 1(b) of this Act.

Notice to Passengers

     Sec. 4. The operator of an excursion train that is certified under Section 1(a) of this Act shall:

     (1) issue each passenger a ticket with the following statement in 12-point boldface type: "THE OPERATOR OF THIS TRAIN IS NOT LIABLE FOR PERSONAL INJURY OR WRONGFUL DEATH IN AN AMOUNT IN EXCESS OF $5,000,000"; and

     (2) post notice near a passenger boarding area containing the same statement required in Subdivision (1) of this section in letters that are at least two inches high.

Restrictions

     Sec. 5. The operator of an excursion train that is certified under Section 1(a) of this Act may not carry:

     (1) freight other than the personal luggage of the passengers or crew or supplies and equipment necessary to serve the needs of the passengers and crew;

     (2) passengers who are commuting to work; or

     (3) passengers who are traveling to their final destination solely for business or commercial purposes.

Acts 1995, 74th Leg., ch. 910, eff. Sept. 1, 1995.

Art. 9031. Lienholder Approval of Insurance Claim Payment

Text of article as added by Acts 1997, 75th Leg., ch. 407, § 1

     Sec. 1. If payment of an insurance claim relating to personal property requires the endorsement of a check or draft by a holder of a lien on the property or otherwise requires approval of the lienholder, the lienholder, not later than the 14th business day after the date the lienholder receives a request for the endorsement or other approval, shall:

     (1) provide the endorsement or other approval; or

     (2) provide the person who requested the endorsement or other approval a written statement of the reason for denial of the endorsement or other approval.

     Sec. 2. (a) A lienholder who violates Section 1 of this article is liable for a civil penalty not to exceed $500 for each violation.

     (b) The attorney general may sue to collect a civil penalty under this section.

Added by Acts 1997, 75th Leg., ch. 407, § 1, eff. Sept. 1, 1997.

     For text of article as added by Acts 1997, 75th Leg., ch. 1215, § 2, see art. 9031, post.

Art. 9031. Prohibited Use of Genetic Information

Text of article as added by Acts 1997, 75th Leg., ch. 1215, § 2

Definitions

     Sec. 1. In this article:

     (1) "DNA" means deoxyribonucleic acid.

     (2) "Genetic information" means information derived from the results of a genetic test.

     (3) "Genetic test" means a laboratory test of an individual's DNA, RNA, proteins, or chromosomes to identify by analysis of the DNA, RNA, proteins, or chromosomes the genetic mutations or alterations in the DNA, RNA, proteins, or chromosomes that are associated with a predisposition for a clinically recognized disease or disorder. The term does not include:

     (A) a routine physical examination or a routine test performed as a part of a physical examination;

     (B) a chemical, blood, or urine analysis;

     (C) a test to determine drug use; or

     (D) a test for the presence of the human immunodeficiency virus.

     (4) "Licensing authority" means a state agency or political subdivision that issues an occupational license.

     (5) "Occupational license" means a license, certificate, registration, permit, or other form of authorization required by law or rule that must be obtained by an individual to engage in a particular business or occupation.

     (6) "Political subdivision" means a municipality, county, or special district or authority. The term includes a school district.

     (7) "RNA" means ribonucleic acid.

     (8) "State agency" means a department, board, bureau, commission, committee, division, office, council, or agency in the executive or judicial branch of state government.

Genetic testing requirement prohibited

     Sec. 2. A licensing authority may not deny an application for an occupational license, suspend, revoke, or refuse to renew an occupational license, or take any other disciplinary action against a license holder based on the refusal of the license applicant or license holder to:

     (1) submit to a genetic test; or

     (2) reveal:

     (A) whether the applicant or holder has submitted to a genetic test; or

     (B) the results of any genetic test to which the applicant or holder has submitted.

Information confidential; exceptions

     Sec. 3. (a) Except as provided by Subsections (c) and (d) of this section, genetic information is confidential and privileged regardless of the source of the information. A person or entity that holds that information may not disclose or be compelled to disclose, by subpoena or otherwise, genetic information about an individual unless the disclosure is specifically authorized by the individual as provided by Subsection (b) of this section. This subsection applies to a redisclosure of genetic information by a secondary recipient of the information after disclosure of the information by an initial recipient.

     (b) An individual or the legal representative of an individual may authorize the disclosure of genetic information relating to that individual through a written authorization that includes:

     (1) a description of the information to be disclosed;

     (2) the name of the person or entity to whom the disclosure is made; and

     (3) the purpose for the disclosure.

     (c) Subject to Subchapter G, Chapter 411, Government Code, genetic information relating to an individual may be disclosed without the authorization required under Subsection (b) of this section if the disclosure is:

     (1) authorized under a state or federal criminal law relating to:

     (A) the identification of individuals; or

     (B) a criminal or juvenile proceeding, an inquest, or a child fatality review by a multidisciplinary child-abuse team;

     (2) required under a specific order of a state or federal court;

     (3) authorized under a state or federal law to establish paternity;

     (4) made to furnish genetic information relating to a decedent to the blood relatives of the decedent for the purpose of medical diagnosis; or

     (5) made to identify a decedent.

     (d) In addition to the exceptions under Subsection (c), genetic information relating to an individual may be disclosed without the authorization required under Subsection (b) if:

     (1) the disclosure is for information from a research study in which the procedure for obtaining informed written consent and use of the information is governed by national standards for protecting participants involved in research projects, including guidelines issued under 21 C.F.R. Part 50 and 45 C.F.R. Part 46;

     (2) the information does not identify a particular individual; and

     (3) the information is provided to the Texas Department of Health to comply with Chapter 87, Health and Safety Code.

Right to know test results

     Sec. 4. An individual who submits to a genetic test has the right to know the results of that test. On the written request of the individual, the entity that performed the test shall disclose the test results to the individual or to a physician designated by the individual.

Retention of sample

     Sec. 5. A sample of genetic material taken for a genetic test from an individual shall be destroyed promptly after the purpose for which the sample was obtained is accomplished unless:

     (1) the sample is retained under a court order;

     (2) the individual tested authorizes retention of the sample for purposes of medical treatment or scientific research;

     (3) for a sample obtained for research that is cleared by an institutional review board, the sample is retained under the requirements that the institutional review board imposes on a specific research project or as authorized by the research participant with institutional review board approval under federal law; or

     (4) the sample was obtained for a screening test established by the Texas Department of Health and performed by that department or by a laboratory approved by that department under Section 33.011, Health and Safety Code.

Added by Acts 1997, 75th Leg., ch. 1215, § 2, eff. Sept. 1, 1997.

     For text of article as added by Acts 1997, 75th Leg., ch. 407, § 1, see art. 9031, ante.

Art. 9034. Industrial Hygiene Title Recognition Act

Text of article as added by Acts 1999, 76th Leg., ch. 981, § 1

Short title

     Sec. 1. This article may be cited as the Industrial Hygiene Title Recognition Act.

Purpose

     Sec. 2. The purpose of this article is to provide legal recognition of the certification of industrial hygienists and to provide assurance to the public that an individual who represents that the individual is involved in industrial hygiene has met minimum qualifications that protect the public health and safety.

Definitions

     Sec. 3. In this article:

     (1) "American Board of Industrial Hygiene" is a nonprofit corporation established to improve the practice and educational standards of the profession of industrial hygiene by certifying individuals that meet the educational, experience, and examination requirements of that board.

     (2) "Certified industrial hygienist" or "CIH" means a person certified by the American Board of Industrial Hygiene as a certified industrial hygienist and whose certification has not lapsed or been revoked.

     (3) "Industrial hygiene certification organization" means a nonprofit corporation established to improve the practice and educational standards of the profession of industrial hygiene by certifying individuals who meet its education, experience, and examination requirements. The organization must maintain criteria at least as stringent as those adopted by the American Board of Industrial Hygiene.

     (4) "Industrial hygienist in training" or "IHIT" means a person certified as an industrial hygienist in training by the American Board of Industrial Hygiene and whose certification has not lapsed or been revoked.

Protection of Titles

     Sec. 4. A person may not use the title of, or represent to the public that a person is, a "certified industrial hygienist," "CIH," or "industrial hygienist in training," "IHIT," unless the person meets the requirements and qualifications for that title under the definitions of this article.

Civil Penalty

     Sec. 5. A violation of Section 4 of this article is punishable by a civil penalty of not more than $1,000 for each violation. The attorney general may bring an action to collect the penalty. A penalty collected under this subsection shall be deposited in the general revenue fund.

Added by Acts 1999, 76th Leg., ch. 981, § 1, eff. Sept. 1, 1999.

     For text of article as added by Acts 1999, 76th Leg., ch. 1559, § 1, see art. 9034, post.

Art. 9034. Regulation of Certain Service Contract Providers

Text of article as added by Acts 1999, 76th Leg., ch. 1559, § 1

Short title

     Sec. 1. This article may be cited as the "Service Contract Regulatory Act."

Definitions

     Sec. 2. In this article:

     (1) "Administrator" means the person responsible for the administration of a service contract or service contract plan. The term includes a person responsible for any filings required by this article.

     (2) "Commissioner" means the commissioner of licensing and regulation.

     (3) "Commission" means the Texas Commission of Licensing and Regulation.

     (4) "Consumer" means an individual who buys, other than for purposes of resale, any tangible personal property that is:

     (A) distributed in commerce; and

     (B) normally used for personal, family, or household purposes and not for business or research purposes.

     (5) "Department" means the Texas Department of Licensing and Regulation.

     (6) "Maintenance agreement" means an agreement of limited duration that provides only for scheduled maintenance.

     (7) "Person" means an individual or a partnership, company, corporation, association, or other group, however organized.

     (8) "Premium" means the consideration paid to an insurer for a reimbursement insurance policy.

     (9) "Provider" means a person who is contractually obligated to the service contract holder under the terms of the service contract.

     (10) "Provider fee" means the consideration paid for a service contract.

     (11) "Reimbursement insurance policy" means a policy of insurance issued to a provider to:

     (A) provide reimbursement to the provider under the terms of the insured service contracts issued or sold by the provider; or

     (B) pay on behalf of the provider, in the event of the provider's nonperformance, all covered contractual obligations incurred by the provider under the terms of the insured service contracts issued or sold by the provider.

     (12) "Service contract" means an agreement, entered into for a separately stated consideration and for a specified term, under which a provider agrees to repair, replace, or maintain a product, or provide indemnification for the repair, replacement, or maintenance of a product, for operational or structural failure caused by a defect in materials or workmanship or by normal wear. A service contract may additionally provide for incidental payment or indemnity under limited circumstances, including towing, rental, and emergency road service, or for the repair or replacement of a product for damage resulting from power surges or accidental damage incurred in handling the product.

     (13) "Service contract holder" means a person who purchases or otherwise holds a service contract.

     (14) "Warranty" means, in relation to a product or service, an undertaking that guarantees indemnity for defective parts, mechanical or electrical breakdown, labor costs, or other remedial measures, such as repair or replacement of the product or repetition of services, and that is:

     (A) made solely by the manufacturer, importer, or seller of the product or services;

     (B) made without payment of additional consideration;

     (C) not negotiated or separated from the sale of the product or service; and

     (D) incidental to the sale of the product or service.

Powers and duties of commissioner

     Sec. 3. (a) The commissioner may adopt rules as necessary to implement this article.

     (b) The commissioner may conduct investigations of providers, administrators, or other persons as necessary to enforce this article and protect service contract holders in this state. On request of the commissioner, a provider shall make the provider's records maintained under Section 9 of this article regarding service contracts sold by the provider available to the commissioner as necessary to enable the commissioner to reasonably determine compliance with this article.

Service contract providers advisory board

     Sec. 4. (a) The service contract providers advisory board is an advisory body to the department. The advisory board shall advise:

     (1) the commissioner in adopting rules and enforcing and administering this article; and

     (2) the commission in setting fees.

     (b) The advisory board is composed of six members appointed by the commissioner as follows:

     (1) two members must be officers, directors, or employees of a provider of service contracts that have been approved by the commissioner;

     (2) two members must be officers, directors, or employees of a retail outlet or other entity located in this state that provides to consumers service contracts approved by the commissioner for sale to consumers;

     (3) one member must be an officer, director, or employee of an entity approved by the Texas Department of Insurance to sell reimbursement insurance policies; and

     (4) one member must be a resident of this state who has, as a consumer, a service contract in force in this state at the time of the appointment that is issued by a provider registered under this article.

     (c) A member of the advisory board serves a term of six years with terms expiring on February 1 of odd-numbered years.

     (d) The commissioner shall designate one member of the advisory board to serve as presiding officer. The commissioner or the commissioner's designee shall serve as an ex officio nonvoting member of the advisory board. The commissioner shall fill any vacancy on the advisory board for the remainder of the unexpired term with an individual who represents the same interests with which the predecessor was identified.

     (e) The advisory board shall meet at least every six months and may meet at other times at the call of the presiding officer. The advisory board shall meet at a location in this state designated by the advisory board.

     (f) A decision of the advisory board is not effective unless it receives the affirmative vote of at least four members.

     (g) The advisory board members serve without compensation. A member is entitled to reimbursement for actual and necessary expenses incurred in performing functions as a member of the advisory board, subject to any applicable limitation on reimbursement provided by the General Appropriations Act.

Registration requirements; exemptions

     Sec. 5. (a) A person may not operate as a provider of service contracts sold in this state unless the person is registered with the department. Except for this registration requirement, providers and service contract sellers, administrators, and other persons marketing, selling, or offering to sell service contracts are exempt from any licensing requirements of this state that relate to the activities regulated under this article.

     (b) Each applicant for registration shall file a registration application with the commissioner in the form prescribed by the commissioner that includes evidence satisfactory to the commissioner of compliance with the financial security requirements adopted under Section 6 of this article.

     (c) Each registered provider shall pay an annual registration fee not to exceed $2,000 as set by the commission to cover the costs of administrating this article. The commissioner shall develop a tiered fee structure under which registration fees are assessed on providers based on the number of service contracts sold within this state in the prior 12-month period. The information submitted to the commissioner under this section regarding the number of service contracts sold by a provider may only be used by the commissioner and the department in determining the tiered fee structure. Information concerning the number of service contracts sold by a provider that is submitted under this section is a trade secret and subject to Section 552.110, Government Code.

     (d) The marketing, sale, offering for sale, issuance, making, proposing to make, and administration of service contracts are exempt from:

     (1) the Insurance Code and other laws of this state regulating the business of insurance;

     (2) Article 6573b, Revised Statutes; and

     (3) Chapter 722, Transportation Code.

     (e) The following contracts and agreements are specifically exempt from the application of this article and are only subject to other statutes and laws which specifically apply to them:

     (1) warranties;

     (2) maintenance agreements;

     (3) service contracts sold or offered for sale to persons other than consumers;

     (4) residential service contracts sold by entities licensed by the Texas Real Estate Commission under Article 6573b, Revised Statutes;

     (5) agreements issued by automobile service clubs certified under Chapter 722, Transportation Code;

     (6) service contracts sold by a motor vehicle dealer on vehicles sold by that dealer if the dealer is the provider and is licensed as a motor vehicle dealer pursuant to Subchapter D, Texas Motor Vehicle Commission Code (Article 4413(36), Vernon's Texas Civil Statutes), and covers its obligations under the service contract with a reimbursement insurance policy as defined by Section 2(11) of this article; and

     (7) contracts or agreements offered by local exchange telephone companies providing repair for inside telephone wiring for which the term does not exceed one month and which the consumer can terminate before commencing a new term without liability except for payment of charges for the current term.

Financial security requirements

     Sec. 6. (a) To ensure the faithful performance of a provider's obligations to its service contract holders, each provider shall comply with one of the following financial security requirements:

     (1) insure its service contracts under a reimbursement insurance policy issued by an insurer authorized to transact insurance in this state or under a surplus lines insurance policy issued by an insurer eligible to place coverage in this state as regulated under Article 1.14–2, Insurance Code;

     (2)(A) maintain a funded reserve account for its obligations under its service contracts issued and outstanding in this state. The reserves shall be not less than 40 percent of the gross consideration received from consumers, less claims paid, on the sale of the service contract for all in-force contracts. The reserve account shall be subject to examination and review by the commissioner; and

     (B) place in trust with the commissioner a financial security deposit, having a value of not less than five percent of the gross consideration received from consumers, less claims paid, on the sale of the service contract for all service contracts issued and outstanding in this state, but not less than $25,000, and consisting of:

     (i) a surety bond issued by an authorized surety;

     (ii) securities of the type eligible for deposit by authorized insurers in this state;

     (iii) a statutory deposit of cash or cash equivalents;

     (iv) a letter of credit issued by a qualified financial institution; or

     (v) another form of security prescribed by rules issued by the commissioner; or

     (3)(A) maintain, or have its parent company maintain, a net worth or stockholders' equity of at least $100 million; and

     (B) upon request, provide the commissioner a copy of the provider's or the provider's parent company's most recent Form 10-K or Form 20-F filed with the Securities and Exchange Commission within the last calendar year or, if the company does not file with the Securities and Exchange Commission, a copy of the provider's or the provider's parent company's audited financial statements showing a net worth of the provider or its parent company of at least $100 million. If the provider's parent company's Form 10-K, Form 20-F, or audited financial statements are filed to meet the provider's financial stability requirement, the parent company shall agree to guarantee the obligations of the provider relating to service contracts sold by the provider in this state.

     (b) No other financial security requirements shall be required by the commissioner for service contract providers.

Reimbursement insurance policy

     Sec. 7. (a) In order for a provider to comply with Section 6 of this article through the use of a reimbursement insurance policy, such policy must state that:

     (1) the insurer that issued the reimbursement insurance policy shall reimburse or pay on behalf of the provider any covered amounts the provider is legally obligated to pay or shall provide the service that the provider is legally obligated to perform according to the provider's contractual obligations under the insured service contract issued or sold by the provider; and

     (2) if the covered service is not provided to a service contract holder within 60 days of proof of loss, payment shall be made directly from the reimbursement insurer to the service contract holder or the reimbursement insurer shall provide the required service.

     (b) An insurer that issues a reimbursement insurance policy under this article may not cancel the policy until the insurer delivers to the provider a written notice of cancellation that complies with the requirements adopted for those notices under Articles 21.49–2A and 21.49–2B, Insurance Code. The provider shall forward a copy of the cancellation notice to the commissioner not later than the 15th business day after the date the notice is delivered to the provider. The cancellation of a reimbursement insurance policy does not reduce the insurer's responsibility for service contracts issued by the provider and insured under the policy before the date of the cancellation.

     (c) For purposes of this section, the provider is considered the agent of the insurer that issues the reimbursement insurance policy for purposes of obligating the insurer to service contract holders in accordance with the service contract and this article.

     (d) This article does not prevent or limit the right of an insurer that issues a reimbursement insurance policy to seek indemnification or subrogation against a provider if the insurer pays or is obligated to pay a service contract holder any amount that the provider is obligated to pay under the terms of the service contract.

General provider operation requirements

     Sec. 8. (a) A provider may appoint an administrator or other designee to be responsible for any or all of the administration or sale of service contracts and for compliance with this article.

     (b) A service contract may not be issued, sold, or offered for sale in this state unless the provider has provided to the service contract holder:

     (1) a receipt for, or other written evidence of, the purchase of the service contract; and

     (2) a copy of the service contract within a reasonable period after the date of purchase.

Provider records

     Sec. 9. (a) Each provider shall maintain accurate accounts, books, and other records regarding transactions regulated under this article. The provider's records must include:

     (1) a copy of each unique form of service contract sold;

     (2) the name and address of each service contract holder, if the name and address have been furnished by the contract holder;

     (3) a list of the locations at which the provider's service contracts are marketed, sold, or offered for sale; and

     (4) written claims files that contain at least the dates and descriptions of claims related to the service contracts.

     (b) Except as provided by Subsection (d) of this section, each provider shall retain all records required to be maintained under Subsection (a) of this section at least until the first anniversary of the expiration date under the contract of the specified period of coverage.

     (c) The records required to be maintained under this section may be maintained in an electronic medium or through other recordkeeping technology. If a record is maintained in a format other than hard copy, the provider must be able to reformat the record into legible hard copy at the request of the commissioner.

     (d) A provider who discontinues business in this state shall maintain its records until the provider furnishes the commissioner with proof satisfactory to the commissioner that the provider has discharged all obligations to service contract holders in this state.

Required disclosures

     Sec. 10. (a) Each service contract marketed, sold, offered for sale, issued, made, proposed to be made, or administered in this state shall be written, printed, or typed in clear, understandable language that is easy to read and shall disclose the applicable requirements set forth in this section.

     (b) A service contract insured under a reimbursement insurance policy under Section 6(a) of this article must contain a statement substantially similar to the following: "Obligations of the provider under this service contract are insured under a service contract reimbursement insurance policy." The service contract shall state the name and address of the insurer and state that in the event covered service is not provided by the service contract provider within 60 days of proof of loss by the service contract holder, the service contract holder may apply for reimbursement directly to the service contract reimbursement insurance company.

     (c) A service contract that is not insured under a reimbursement insurance policy must contain a statement substantially similar to the following: "Obligations of the provider under this service contract are backed by the full faith and credit of the provider."

     (d) Each service contract shall state the name and address of the provider and shall identify any administrator, if different from the provider, the service contract seller, and the service contract holder, to the extent that the name of the service contract holder has been furnished by the service contract holder. The identities of those persons are not required to be preprinted on the service contract and may be added to the service contract at the time of sale.

     (e) Each service contract must state the purchase price of the contract and the terms under which the contract is sold. The purchase price is not required to be preprinted on the service contract and may be negotiated at the time of sale with the service contract holder.

     (f) Each service contract must state the terms, restrictions, or conditions governing cancellation of the service contract by either the provider or the service contract holder before the expiration date of the service contract. A provider shall mail a written notice of cancellation to the service contract holder at the last known address of the service contract holder contained in the records of the provider before the fifth day preceding the effective date of the cancellation. Prior notice is not required if the reason for cancellation is nonpayment of the provider fee, a material misrepresentation by the service contract holder to the provider, or a substantial breach of duties by the service contract holder relating to the covered product or its use. The notice must state the effective date of the cancellation and the reason for the cancellation.

     (g) Each service contract must:

     (1) state the amount of any deductible, if applicable;

     (2) specify the products and services to be provided and any limitations, exceptions, or exclusions;

     (3) specify any restrictions governing the transferability of the service contract;

     (4) state the duties of the service contract holder, including any duty to protect against any further damage and any requirement to follow owner's manual instructions; and

     (5) if applicable, state whether the service contract provides for or excludes consequential damages or preexisting conditions.

Voiding of contract

     Sec. 11. (a) Each service contract shall require the provider to permit the service contract holder to return the service contract not later than the 20th day after the date the service contract was mailed to the service contract holder or, if the service contract is delivered to the service contract holder at the time of sale, not later than the 10th day after the date of delivery. A service contract holder may void the service contract at a later time as permitted by the service contract.

     (b) If a contract holder returns a service contract under Subsection (a) of this section and a claim has not been made under the service contract before its return to the provider, the service contract is void and the provider shall refund to the service contract holder or credit to the account of the service contract holder the full purchase price of the service contract. The right provided by this section to void the service contract is not transferable and applies only to the original service contract purchaser. If a service contract is voided under this section and the provider does not pay the refund or credit the service contract holder's account before the 46th day after the date of the return of the service contract to the provider, the provider is liable to the contract holder for a penalty in an amount not to exceed 10 percent of the amount outstanding per month.

Limitations on provider name

     Sec. 12. (a) A provider may not use:

     (1) in its name the words insurance, casualty, surety, mutual, or any other words descriptive of the insurance, casualty, or surety business;

     (2) a name deceptively similar to the name or description of any insurance or surety corporation; or

     (3) a name deceptively similar to the name of any other provider.

     (b) A provider may use the word "guaranty" or a similar word.

     (c) This section does not apply to a provider that, before September 1, 1999, used a word prohibited under this section in its name, but that provider must include in each of its service contracts a statement in substantially the following form: "This agreement is not an insurance contract."

Prohibited acts

     Sec. 13. (a) A provider, or a provider's representative, may not, in the provider's service contracts or literature:

     (1) make, permit, or cause to be made any false or misleading statement; or

     (2) deliberately omit a material statement that would be considered misleading if omitted.

     (b) A person, including a bank, savings and loan association, lending institution, manufacturer, or seller of any product, may not require the purchase of a service contract as a condition of a loan or the sale of any property.

Enforcement

     Sec. 14. (a) On a finding that a ground for disciplinary action exists under one or more provisions of this article, the commissioner may impose appropriate administrative sanctions, including an administrative penalty as provided by Article 9100, Revised Statutes. An administrative penalty imposed under this section may not exceed $500 per violation or $10,000 in the aggregate for all violations of a similar nature.

     (b) A disciplinary action taken under this article is subject to Section 17(d), Article 9100, Revised Statutes.

     (c) The commissioner may bring an action for injunctive proceedings under Section 18, Article 9100, Revised Statutes, for a threatened or existing violation of this article or the commissioner's orders or rules adopted under this article and may also bring an action for civil penalties as provided by that section. A civil penalty assessed under this subsection may not exceed $2,500 per violation or $50,000 in the aggregate for all violations of a similar nature.

     (d) For purposes of Subsections (a) and (c) of this section, a violation is of a similar nature if the violation consists of the same or a similar course of conduct, action, or practice, regardless of the number of times the act, conduct, or practice determined to be a violation of this article occurred.

Added by Acts 1999, 76th Leg., ch. 1559, § 1, eff. Sept. 1, 1999.

     For text of article as added by Acts 1999, 76th Leg., ch. 981, § 1, see art. 9034, ante.

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