PART 1. OFFICE OF THE GOVERNOR

TITLE 1. ADMINISTRATION PART 1. OFFICE OF THE GOVERNOR CHAPTER 4. TEXAS MILITARY PREPAREDNESS COMMISSION The Texas Military Preparedness Commission (TMPC or Commission) within the Office of the Governor (OOG) proposes amendments to 1 TAC 4.1-4.8 and 4.30, 4.31, 4.34-4.36, and 4.39-4.40 relating to the Texas Military Value Revolving Loan Fund and the Defense Economic Adjustment Assistance Grant under Chapter 436 of the Texas Government Code. Explanation of Proposed Amendments The primary purpose of the proposed amendments to the rules is to implement legislative changes that were enacted by the 84th Legislature, Regular Session. The Commission was established in 2003 within the Economic Development and Tourism Office of the Office of the Governor. Effective as of September 1, 2015, Senate Bill 1358 establishes the Commission as an agency that is attached to the Office of the Governor for administrative purposes. In this regard, a number of references in the rules to the Economic Development and Tourism Office are updated to refer to the Commission. Senate Bill 1358 also increases from $2 million to $5 million the amount of money the Commission can award to a local government entity through its Defense Economic Adjustment Assistance Grant Program (DEAAG). Senate Bills 318 and 503 amend the eligibility requirements for the Defense Economic Adjustment Assistance Grant Program (DEAAG) program to include eligibility for projects that are "necessary to prevent the reduction or closing of a defense facility" and also to permit the use of program grants to train defense workers to support "retained missions" in addition to those missions that may be adversely affected by a base closure or realignment. Senate Bill 503 also changes the eligibility requirements to include communities affected by actions of the 1995 Base Realignment and Closure Commission (BRAC); this has the practical effect of including communities affected by the closure of Bergstrom and Reese Air Force Bases. The proposed amendments include some other minor updates throughout to reflect current Commission operating practices and shared duties with the Texas Economic Development Bank and the Texas Public Finance Authority. A substantive change is proposed for the DEAAG grant application in Rule 4.36 to add two new grant scoring criteria to include consideration of BRAC scoring of the proposed military value of proposed projects. The reporting responsibilities for DEAAG grants in Rule 4.40 are also proposed for modification to eliminate the current reporting requirement for job creation and retention reporting for a two-year period following project completion with a requirement that grantees must provide grant performance reports and project completion reports as required by grant terms. Fiscal Note On behalf of the Texas Military Preparedness Commission, Mr. Bryan Daniel, Director of Economic Development and Tourism, Office of the Governor, has determined that for each of the first five years in which the amendments as proposed are in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the amendments. Mr. Daniel has also determined that there may be a positive fiscal impact in an undetermined amount on local economies or overall employment as a result of the proposed amendments. Public Benefit and Cost Mr. Daniel has also determined that for each year of the first five years in which the proposed amendments are in effect, the public benefit anticipated as a result of the amendments will be to provide increased opportunities for defense communities that have been, or may potentially be, impacted by a past or future BRAC action, to obtain economic assistance to mitigate or prevent or otherwise positively affect their local economy through funded projects. There are no anticipated economic costs for persons required to comply with the sections as proposed. There will be no adverse economic effect on small businesses. Submittal of Comments Written comments on the proposed rules amendments may be submitted to Alexandra Taylor, Office of the Governor, Texas Military Preparedness Commission, P.O. Box 12428, Austin, Texas 78711 or to Alexandra.Taylor@gov.texas.gov with the subject line "TMPC Rules." The deadline for receipt of comments is 5:00 p.m. CST on November 9, All requests for a public hearing on the proposed rules and amendments, submitted under the Administrative Procedure Act, must be received by the Office of the Governor no more than fifteen (15) days after the notice of proposed changes in the sections that have been published in the Texas Register. SUBCHAPTER A. TEXAS MILITARY VALUE REVOLVING LOAN FUND PROGRAM 1 TAC 4.1-4.8 Statutory Authority The amendments are proposed under Government Code, 436.101, which provides the Texas Military Preparedness Commission may enact administrative rules necessary to administer its duties. PROPOSED RULES October 2, 2015 40 TexReg 6799

Cross Reference to Statute Government Code, Chapter 489, as amended by Senate Bill 318, Senate Bill 503 and Senate Bill 1358, 84th Legislature, Regular Session. 4.1. Introduction and Purpose. (a) The [Created by the 78th Legislature and signed into law by Governor Rick Perry, the] Texas Military Value Revolving Loan Fund provides a low cost source of revenue to eligible communities who meet the application criteria. The minimum amount of a loan is $1,000,000 while the maximum amount of a loan is determined by the availability of funds and the creditworthiness of the applicant. State funding will be obtained through the sale of general obligation bonds. The State may provide up to 100 percent of the cost of the described project, dependent upon the creditworthiness of the applicant. (b) The Loan is designed to: (1) assist defense communities in enhancing the military value of a defense facility based on the criteria established in the United States Department of Defense's (DoD) base realignment and closure process; (2) provide financial assistance to defense communities for job creation [creating] or retention economic development projects that minimize the negative effects of a defense base realignment or closure decision that occurred in 1995 [2005] or later; or (3) provide financial assistance to defense communities for infrastructure projects to accommodate new or expanded military missions resulting from a base realignment and closure decision that occurred in 1995 [2005] or later. (c) Definitions. The following words and terms, when used in this section, shall have the following meanings unless otherwise indicated. (1) Applicant--A Defense Community, as defined in paragraph (5) of this subsection, applying for a loan from the Texas Military Value Revolving Loan Fund. (2) Awardee--The Defense community whose loan application is approved by the Commission [office]. (3) Bank--The Texas Economic Development Bank within the Office of the Governor, Economic Development and Tourism Office. (4) Commission--The Texas Military Preparedness Commission. The Commission is attached for administrative purposes to the Office of the Governor. (5) Defense Community--A political subdivision, including a municipality, county, or special district, that is adjacent to, near, or encompasses any part of a defense base. (6) Defense Facility--A military base, camp, post, station, yard, center, homeport facility for any ship, or other activity under the jurisdiction of the Department of Defense, including leased space, that is controlled by, or primarily supports, DoD activities. (7) Director of the Bank--Director of the Texas Economic Development Bank within the Office of the Governor. (8) Director of the Commission--Director of the Texas Military Preparedness Commission. (9) Economic Redevelopment Value Statement--A statement that illustrates specific ways funds are to be used to promote economic development in the community to include that information as provided for in 397.0021 of the Local Government Code. (10) Chief of Staff--The Chief of Staff of the Office of the Governor [Executive Director--The Executive Director of the Economic Development and Tourism Division of the Office of the Governor (EDT)]. (11) Financial Partners--Federal and state agencies, private and public nonprofit foundations, local taxing authorities, and private investors who agree to provide money for projects eligible for funding under this program. (12) Fund--The Texas Military Value Revolving Loan Fund (TMVRLF). (13) Governing Board--Members of the Texas Military Preparedness Commission. (14) Military Value Enhancement Statement--A statement that illustrates specific ways funds are to be used to enhance the military value of the installation to include that information as provided for in 397.002 of the Local Government Code. (15) Project--The construction, renovation, or acquisition for which a TMVRLF loan is requested. (16) Project Costs--The Defense Community's total costs for completing the project, including any and all costs of financing and administration assessed by the Bank in accordance with 489.103 of the Texas Government Code [EDT]. 4.2. Military Value/Redevelopment Value Review and Pre-Application Assessment for Funds. (a) The Defense Community shall submit the following information to the Director of the Commission: (1) defense communities applying for a loan under 436.153 of the Local Government Code shall submit a Military Value Enhancement Statement; or (2) defense communities applying for a loan under 436.1531 or 436.1532 of the Local Government Code shall submit a Defense Community Economic Redevelopment Value Statement. (3) A pre-application assessment. (b) The [Director of the] Commission shall review the Military Value or Redevelopment Value Statement and perform: (1) an analysis of the project feasibility; and (2) an analysis of alternative funding for each project listed. (3) The Commission, in consultation with the Bank, shall review the applicant's pre-application assessment. (c) The Bank shall review the applicant's pre-application assessment. (d) The Governing Board shall take into consideration the Military Value or Redevelopment Value and by a majority vote make its recommendation to approve or disapprove the Military Value or Redevelopment Value Statement 4.3. Processing and Review of Applications. (a) The Commission, in consultation with the Bank, shall conduct its review of the applicant's creditworthiness based on standard due diligence practices and procedures that are consistent with other Bank lending programs including but not limited to: (1) review of project description to assess program criteria requirements; (2) quick assessment project considerations; 40 TexReg 6800 October 2, 2015 Texas Register

search; (3) management assessment and current company news (4) economic/financial analysis; (5) revenue analysis; (6) credit rating review; and (7) financial analysis summary-strengths, weaknesses, exceptions. (b) In addition, the Commission, in consultation with the Texas Public Finance Authority [Bank], shall also be responsible for developing the loan and security structure including: (1) the loan term sheet; (2) the loan agreement; and (3) the bond sale activities. 4.4. Application for Funds. (a) The Commission, in consultation with the Bank, [EDT] shall develop a formal application form to be included in the formal application process to assist in the evaluation of a loan submission. The application may require certain attachments and certifications. (b) At a minimum the application for funds will include: (1) the full legal name and description of requesting loan Applicant and each participating political subdivision under which debt is being issued; (2) a description of the governing body and contact information for person authorized to represent the political subdivision. Include name, title, address, phone, fax number, and e-mail address; (3) the name, address, phone, fax number, e-mail address, and contact person for legal counsel, financial advisor, contract administrator, project engineer, and any other consultant representing the applicant; (4) the prior three years audited financial statements, as applicable, and projected financial statements, including loan repayment. The financial documents must include the applicant's income statement, balance sheet and cash flow statement; (5) documentation of attempts to obtain alternative financing, if applicable; (6) a statement that financing is necessary because full financing is unavailable in traditional capital markets or credit has been offered on terms that would preclude the success of the project; (7) a financial plan that shows how loan proceeds will generate income to repay the loan; (8) the number of jobs to be created and/or retained in the state; and (9) the project budget, including the most current itemized project cost estimates (include all costs, specifically construction, engineering services, legal, and fiscal costs, and funding sources and percentage contribution in a Sources and Uses Statement format). Identify source of these estimates, (i.e., engineer, finance director, financial advisor)[, etc]. (c) Applicant shall also include one (1) certified original of: (1) a resolution/ordinance requesting financial assistance from the Commission [EDT] authorizing the submission of the application and designating the official representative(s) for submitting the application, executing any necessary documents and appearing before the Commission; (2) an affidavit executed by the official representative stating that the facts contained in the application are true and correct to the best of their knowledge and belief; (3) an affidavit executed by the official representative stating that the application was approved by the governing body of the applicant in an open meeting; (4) a certificate of compliance executed by an official representative which warrants compliance by the participating political subdivision with all representations in the application, all federal (where applicable), state, and local laws, and all rules/published policies of the Commission and EDT; and (5) a statement of pending claims or litigation against the applicant that might affect the ability of the applicant to issue debt or that could affect the Commission's [EDT's] ability to recover its investment. (d) Application and closing fee. Applicants [EDT] shall pay a [charge an application] fee provided as prescribed by the Bank for all applications, made payable to the Office of the Governor. In addition, successful applicants may be required to pay, upon financing by the Bank, a closing fee. 4.5. Availability of Funds. (a) Funds Commitment. If the project is approved by the Commission [office], funds become committed to the awardee subject to the sale of the general obligation bonds by the state. (b) Letter of Commitment. The applicant will be required to submit a letter of commitment after the final approval of the project by the Commission [executive director]. (c) Upon sale of state-issued bonds, funds are disbursed to the awardee by the Comptroller of Public Accounts. 4.6. Awardee Responsibilities. In order to receive disbursement of loan funds that have been committed to them, awardees will be required by contract with the Commission [EDT] to: (1) have a system established in writing to ensure that appropriate officials provide necessary internal reviews and approvals for the expenditure of funds and for monitoring project performance and adherence to state terms and conditions; (2) have financial management systems that meet the requirements of the Commission [EDT]; (3) retain financial management records, supporting documents, statistical records, and other materials pertinent to the award until the debt is retired and make these records available to the Commission [EDT] upon request; (4) be responsible for performing the duties and tasks described under all project loan agreements; (5) provide the Commission [EDT] with copies of all project documentation required by federal or other financial partners; (6) provide project demonstrations, site inspections, photo or other documentation, including written materials to substantiate benefit to the community's economy and enhancement of the military value of the facility as may be requested by the Commission [EDT]; (7) agree that the loan may be suspended or terminated if the awardee fails to comply with the [EDT] terms and conditions of the loan, or if the financial partnership is suspended or terminated; (8) agree that when two or more entities are participating together as an awardee, if one or more of the entities does not fulfill its PROPOSED RULES October 2, 2015 40 TexReg 6801

loan repayment obligation, then the remaining entity or entities are still liable for repayment of the entire loan amount; (9) agree that neither the Commission nor the Office of the Governor [EDT] shall [not] be held liable in the event of damages to persons or property which may occur in the course of activities conducted as a result of the award or its cancellation or withdrawal; and (10) agree to such other terms and conditions as the Commission [EDT] may require. 4.7. Office and Commission Responsibilities. (a) In carrying out its duties and responsibilities under the Act, the Commission shall: (1) publicize the program to potential applicants; (2) work closely with loan applicants to ensure the application is complete and all relevant material is provided; (3) establish and conduct the evaluation process in a responsive manner to maximize the opportunity to acquire federal and other funding; (4) develop contracts with awardees that include sufficient performance measures, audit requirements, and reporting requirements to ensure prudence and due diligence in the expenditure of state funds; and (5) minimize reporting requirements that may be repetitive of reporting required by federal grant agencies or unnecessary for the effective monitoring of the program. (b) Waiver. The Commission, in consultation with the Chief of Staff or his designee, [executive director] may waive any provision of this chapter upon a finding that the public interest would be furthered by granting the waiver. 4.8. Reporting Responsibilities. (a) After completion of the project, the awardee will provide milestones and updates as required by the contract. (b) Throughout the project period, the awardee must provide copies of all reports required by federal agencies pursuant to the terms of individual federal grants received, within 30 days of their submission to the granting agencies. (c) Failure to submit reports in a timely and satisfactory manner may result in the withholding of funds due or requested by the awardee. Failure to document post-completion requirements may result in the return of funds to Commission [EDT] as set forth in the contract. Filed with the Office of the Secretary of State on September 18, TRD-201503887 Shane Linkous Assistant General Counsel Office of the Governor For further information, please call: (512) 475-1475 SUBCHAPTER B. DEFENSE ECONOMIC ADJUSTMENT ASSISTANCE GRANT PROGRAM 1 TAC 4.30, 4.31, 4.34-4.36, 4.39, 4.40 Statutory Authority The amendments are proposed under Government Code, 436.101, which provides the Texas Military Preparedness Commission may enact administrative rules necessary to administer its duties. Cross Reference to Statute Government Code, Chapter 489, as amended by Senate Bill 318, Senate Bill 503 and Senate Bill 1358, 84th Legislature, Regular Session. 4.30. Introduction and Purpose. (a) Background. The Texas Defense Economic Adjustment Assistance Grant Program (DEAAG) provides [was authorized by the 75th Legislature to provide] state funds to assist defense communities that have been or may be adversely or positively impacted by an anticipated, planned, announced, or implemented action of the United States Department of Defense to close, reduce, increase, or otherwise realign defense worker jobs or facilities. [decreased defense expenditures and defense worker employment. Subsequently, the 79th Legislature amended the program to include defense communities that have been positively impacted and the 81st Legislature amended the program to include job retention.] (b) The goal of the program is to increase and/or retain employment opportunities for dislocated defense workers and residents of adversely affected defense communities and reuse vacated property as efficiently as possible. The goal is to also assist positively affected defense communities that receive new, [or] expanded, or retained military missions as a result of the United States Department of Defense Base Realignment and Closure process. (c) A local government entity is eligible for a grant if it is: (1) a municipality or county that is a defense community; (2) a regional planning commission that has a defense community within its boundaries; (3) a public junior college district all or part of which is located in a defense community; (4) a campus or extension center of the Texas State Technical College system located in a defense community; (5) a defense based development authority created under Chapter 379B, Local Government Code; or (6) a political subdivision having the power of a defense development authority created under Chapter 379B, Local Government Code. (d) Grant Criteria: (1) To meet a matching money or investment requirement in order to receive from the United States Government assistance that is provided to allow the government entity to respond to or recover from an event listed in 486.003 of the Government Code; (2) Acquiring federal grant assistance or for sharing in the costs of purchases of property from the Department of Defense or its designated agent, new construction, rehabilitation, renovation or demolition of facilities; 40 TexReg 6802 October 2, 2015 Texas Register

(3) Construct infrastructure and other projects necessary to accommodate a new, expanded or retained [or expanded] military mission(s) at a military facility located in or near the local government entity; (4) Construct infrastructure and other projects necessary to reduce the impact of an action of the Department of Defense that will adversely impact a defense facility located in or near the local governmental entity; (5) [(4)] If the grantee is a public junior college or a technical college, grant proceeds may be used to purchase or lease equipment to train defense workers whose jobs have been threatened, lost, gained or retained; or to train workers to support military installations or defense facilities. (e) Definitions. The following words and terms, when used in this subchapter, shall have the following meanings unless indicated otherwise. (1) Awardee--The local governmental entity whose application is approved by the governing board. (2) Defense worker-- (A) An employee of the United States Department of Defense, including a member of the armed forces and government civilian workers; (B) An employee of a government agency or private business, or entity providing a Department of Defense related function, who is employed on a defense facility; (C) An employee of a business that provides direct services or products to the Department of Defense and whose job is directly dependent on defense expenditures; or (D) An employee or private contractor employed by the United States Department of Energy working on a defense or Department of Energy facility in support of a Department of Defense related project. (3) Defense worker job--a Department of Defense authorized permanent position or a position held or occupied by one or more defense workers for more than 12 months. (4) Defense Installation [Facility]--A military base, camp, post, station, yard, center, homeport facility for any ship, or other activity under the jurisdiction of the Department of Defense, including leased space, that is controlled by, or primarily supports, DoD's activities. (5) Defense community--a political subdivision, including a municipality, county, or special district, that is adjacent to, is near, or encompasses any part of a defense base. (6) New direct permanent job--a new employment position created by a qualified business that provides at least 1,820 hours of employment a year after the completion of the project and whose position is within the governmental entity's defense community and can be verified. A new direct permanent job can also include subcontractors to a qualified business so long as those jobs relate directly to the work being performed as defined in the DEAAG application and who perform no less than 50 percent of the person's service for the qualified business in the government entity's defense community and can be verified. (7) Retained jobs--a defense worker employed within the government entity's defense community before a Department of Defense action and is retained as a qualified employee by a qualified employer after the date on which the project is completed, employed at 1,820 hours annually and is located within the government entity's defense community and can be verified. (8) Office--The [Texas Economic Development and Tourism Division,] Office of the Governor. (9) Commission--Texas Military Preparedness Commission. The Commission is attached to the Office of the Governor for administrative purposes. (10) Director--The Director of the Texas Military Preparedness Commission or his designee. (11) Financial partners--federal and state agencies, private and public non-profit foundations, local taxing authorities, and private investors who agree to provide money for a project eligible for funding under this grant. (12) Fiscal year--the State of Texas fiscal year, September 1st through August 31st. (13) Application Deadline--Not later than 5:00 PM Central Time on the closing date indicated in the grant solicitation. (14) Governing Board--The Commissioners of the Texas Military Preparedness Commission. (15) Review Panel--The Defense Economic Adjustment Assistance Review Panel, a group of at least three and not more than five professional full-time employees from within the Office of the Governor, who evaluate grant applications and make grant award recommendations to the governing board. (16) Qualified Business--A business that is engaged in or has provided substantial commitment to initiate the active conduct of a trade or business within the government entity's defense community. 4.31. Program Coverage. State funds provided under the Defense Economic Adjustment Assistance Grant Program must be expended not later than the end of the state fiscal biennium [second full fiscal year after the fiscal year] in which the grant was awarded. 4.34. Maximum and Minimum Awards. (a) Amount. The minimum amount of award will be $50,000. The maximum amount of award will be $5 [$2] million. (b) Percentage. The governing board may provide up to: (1) 50 percent of the amount of matching money or investment that the local governmental entity is required to provide for acquiring federal grants; or (2) 50 percent of the local governmental entity's investment for qualifying redevelopment projects; or (3) 80 percent of the amount of matching money or investment required in cases where the local governmental entity demonstrates to the Commission that resources are not available because of a limited local governmental entity budget; or (4) 100 percent to a public junior college, a campus or extension center as defined in 486.003(a)(3) or (4) of the Government Code. (5) The Commission may make a grant to an eligible local governmental entity without regard to the availability or acquisition of matching money in accordance with 436.202(d) of the Government Code. (c) Certification. PROPOSED RULES October 2, 2015 40 TexReg 6803

(1) Local governmental entities are encouraged to acquire financial assistance for eligible development projects from a variety of sources including federal, state, local and private/public foundations. The Chief Financial Officer of the local governmental entity or the local governing body submitting the application will provide adequate certification showing reasonable local community efforts to acquire funding from other sources when the state is the only other financial partner. (2) In submitting an application under subsection (b)(3) of this section, the Chief Financial Officer or the local governing body will certify that local community budget and resources are not adequate or available and shall provide specific information on local efforts to secure adequate funding. Justification should include an overview of the status of development sales tax efforts and bond authority. (d) Community Support. (1) Applicants shall provide a minimum matching money investment of 50 percent of the amount of DEAAG funding being requested. (2) The Commission may waive the 50 percent requirement to a 20 percent matching money investment of the amount of DEAAG funding being requested where the local governmental entity demonstrates to the Commission that resources are not available because of a limited local governmental entity budget. (3) When submitting an application under paragraph (2) of this subsection, the Chief Financial Officer or the local governing body making application will certify that local community budget and resources are not adequate or available and provide specific information on local efforts to secure adequate funding. Justification should include an overview of the status of development sales tax efforts and bond authority. 4.35. Application for Funds. (a) The Commission shall develop a formal application form to be included in the formal application process to assist in the evaluation of the grant submission. The application may require certain attachments and certifications. (b) At a minimum the application for funds will include: (1) A detailed overview of the project and the use of the funds; (2) An overview of the event(s) that qualify the local government, under the eligibility criteria described in 4.32 of this title (relating to Eligibility for Funds), to apply for the grant program; (3) An impact statement detailing the adverse, [or] positive, or proposed effect caused by the event(s) described in 4.32(a) of this title on the local governmental entity; (4) Information on the community's efforts to secure other funding sources; (5) A detailed financial plan for the project; (6) A summary of the extent to which the local governmental entity has used its existing resources to promote local economic development and to promote private investment to create or retain jobs in the area; (7) Efforts made by the government entity to retain or recruit qualified businesses; (8) The amount of any previously awarded funds under this program and the number of jobs created from this award; and (9) The anticipated number of new direct permanent jobs to be created or retained and the economic benefit to the community if the application is successful and the project is funded. 4.36. Processing and Review of Application. (a) The local governing body will submit applications for the program to the [Director of the] Texas Military Preparedness Commission. (b) Applications or additional information received after the application deadline will not be considered. (c) The Texas Military Preparedness Commission will: (1) Publicize the program to potential applicants and provide grant solicitation information; and (2) Evaluate each application for completeness. (d) The Commission may assist a local government entity in applying for a grant. (e) The Director will: (1) Appoint a review panel consisting of himself and two to four full-time employees from the Office of the Governor evaluate applications; and (2) Appoint a review panel chairman. (f) The Review Panel will: (1) Review applications, score, and make recommendations to the governing board; (2) Provide evaluations and recommendations for grant awards for all grant applications received based on but not limited to the following criteria: (A) If the effect on the local governmental entity is adverse or positive; (B) If the effect on the local governmental entity is positive and if that affect was a result of the United States DoD base realignment and closure process; (C) The significance of the number of jobs lost, gained or retained in relation to the workforce in the local governmental entity's jurisdiction and the effect on the area's current and/or projected economy and tax revenue; (D) The extent to which dislocated defense workers will be retrained and/or retained as qualified employees within the defense community; (E) The extent to which the local governmental entity has used its existing resources to promote local economic development; (F) The amount of any grant(s) that the local governmental entity has previously received under this subchapter; (G) The anticipated number of jobs to be created or retained in relation to the amount of the grant sought; (H) The extent to which the grant will affect the region in which the local governmental entity is located; and (I) If the project will have a negative effect on the encroachment of a defense base within the governmental entity's defense community. (J) The added military value of the project in accordance with the guidelines established by the Department of Defense. (K) The installation's most recent BRAC score, with preference given to those scoring below the national average. 40 TexReg 6804 October 2, 2015 Texas Register

(g) The Governing Board will: (1) Review and score applications using the same criteria as the Review Panel; (2) Ensure that one defense community is not favored over another in approving or disproving funding; (3) Review and take into consideration those recommendations of the Review Panel and the governing board's own score; (4) Review and approve or disapprove the award of the grant by a roll call majority vote; and (5) Provide a statement of explanation for each application approved or disapproved that is not in agreement with the Review Panel recommendations. 4.39. Commission and Office Responsibilities. (a) In carrying out its duties and responsibilities under the Act, the Commission shall: (1) Solicit grant applications and publicize application deadlines; (2) Establish and conduct the evaluation and award process in a responsive manner to maximize the opportunity to acquire federal and other funding; (3) Develop contracts with awardees that include sufficient performance measures, audit requirements, and reporting requirements to ensure prudence and due diligence in the expenditure of state funds; and (4) Minimize reporting requirements that may be repetitive of reporting required by federal grant agencies or unnecessary for the effective monitoring of the program. (b) Waivers. The Commission, in consultation with the Chief of Staff or his designee [executive director] may waive any provision of this subchapter upon a finding that the public interest would be furthered by granting the waiver. 4.40 Reporting Responsibilities. (a) Disbursement of funds will be made in accordance with the terms of the contract. (b) After completion of the project, the awardee will provide the following milestones and updates as required by the contract. (c) Throughout the project period, the awardee must provide copies of all reports required by federal agencies pursuant to the terms of individual federal grants received, within 30 days of their submission to the granting agencies. (d) The awardee must provide all reports to the Commission as required by the terms of the grant contract, including, but not limited to, reports on any performance measures, milestone reports, and project completion reports. [As a performance measure to demonstrate economic benefit to the State of Texas, for two years upon completion of the project the governmental entity shall submit quarterly reports indicating the number of qualified jobs created or retained and the average annual salary for each position.] (e) Failure to submit reports in a timely and satisfactory manner may result in the withholding of funds due or requested by the awardee. Failure to document post-completion requirements may result in the return of funds to the Commission as set forth in the contract. Filed with the Office of the Secretary of State on September 18, TRD-201503888 Shane Linkous Assistant General Counsel Office of the Governor For further information, please call: (512) 475-1475 TITLE 7. BANKING AND SECURITIES PART 7. STATE SECURITIES BOARD CHAPTER 113. REGISTRATION OF SECURITIES 7 TAC 113.1 The Texas State Securities Board proposes an amendment to 113.1, concerning qualification of securities. The amendment adds a reference to 114.4, relating to filings and fees for federal covered securities, to the section that discusses state registration of Regulation A offerings. Section 114.4(a) operates to require a notice filing, payment of the fee that would have been paid if the securities had been registered, and, if applicable, a consent to service for federal covered securities that are offered and sold pursuant to Tier 2 of Regulation A. Earlier this year, the Securities and Exchange Commission (SEC) adopted final rules that updated and expanded Regulation A, an existing federal exemption from registration for smaller issuers of securities. These rules provide for two tiers of offerings: Tier 1, for offerings of securities of up to $20 million in a 12-month period; and Tier 2, for offerings of securities up to $50 million in a 12-month period. The SEC rules operate to preempt state securities law registration and qualification requirements for securities offered or sold to "qualified purchasers" in Tier 2 offerings. The SEC defined "qualified purchasers" as all offerees and purchasers in a Regulation A, Tier 2 offering. Accordingly, securities offered and sold in a Regulation A, Tier 2 offering would be federal covered securities, as that term is defined elsewhere in the Board's rules, and would be subject to the filing and fee requirements in Chapter 114 of the Board's rules. Patricia Loutherback, Director, Registration Division, has determined that for the first five-year period the rule is in effect there will be no foreseeable fiscal implications for state or local government as a result of enforcing or administering the rule. Ms. Loutherback also has determined that for each year of the first five years the rule is in effect the public benefit anticipated as a result of enforcing the rule will be to apprise readers that some Regulation A offerings may involve federal covered securities, rather than registered securities in Texas, and direct the reader to the provisions that relate to filings and fees for federal covered securities. There will be no effect on micro- or small businesses. Since the rule will have no adverse economic effect on micro- or small businesses, preparation of an economic impact statement and a regulatory flexibility analysis is not required. There is no anticipated economic cost to persons who are required to comply with the rule as proposed. There is no anticipated impact on local employment. PROPOSED RULES October 2, 2015 40 TexReg 6805

Comments on the proposal must be in writing and will be accepted for 30 days following publication of the proposed section in the Texas Register. Written comments should be submitted to Marlene K. Sparkman, General Counsel, State Securities Board, P.O. Box 13167, Austin, Texas 78711-3167 or faxed to (512) 305-8336. Comments may also be submitted electronically to proposal@ssb.texas.gov. In order to be considered by the Board at adoption, comments must be received no later than 30 days following publication. The amendment is proposed under Texas Civil Statutes, Article 581-28-1. Section 28-1 provides the Board with the authority to adopt rules and regulations necessary to carry out and implement the provisions of the Texas Securities Act, including rules and regulations governing registration statements and applications; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes. The proposal affects Texas Civil Statutes, Article 581 7. 113.1. Qualification of Securities. Regulation "A" and "B" filings with the SEC are forms of exemption and cannot be the basis for a filing by coordination with the State Securities Board under the Texas Securities Act, 7.C. Such registrations with the Board should meet the requirements as outlined in the Act, 7.A or, if federal covered securities, the requirements in 114.4 of this title (relating to Filings and Fees). Filed with the Office of the Secretary of State on September 16, TRD-201503807 John Morgan Securities Commissioner State Securities Board For further information, please call: (512) 305-8301 CHAPTER 115. SECURITIES DEALERS AND AGENTS 7 TAC 115.4, 115.8, 115.18 The Texas State Securities Board proposes amendments to 115.4, concerning evidences of registration, 115.8, concerning fee requirements, and 115.18, concerning special application provisions available to a military spouse, military service member, or military veteran. The proposals are required by Senate Bill 1307, Senate Bill 807, and House Bill 7, passed by the 84th Texas Legislature. Related forms are being concurrently proposed as are comparable amendments to the corresponding rules for investment advisers and investment adviser representatives. SB 1307, effective for applications or renewals filed on or after January 1, 2016, changed Chapter 55 of the Occupations Code relating to occupational licenses and registrations issued to military service members, military veterans, and military spouses (collectively, military applicants). Among its provisions, it requires that a state agency post a notice on its website describing the provisions available to military applicants. To simplify how this notice will be provided, the provisions that relate to military applicants are being relocated to 115.18. Accordingly, portions of subsection (e) of 115.4 would be amended to move the substantive portions relating to renewals by military service members to 115.18. SB 1307 is applicable to applications and renewals filed on or after January 1, 2016. The amendments to 115.18 incorporate those statutory changes. Specifically, the definitions in subsection (a) have been amended to conform to the statute. The changes to subsection (b), elimination of most of current subsection (c), and relocation of the remainder of current subsection (c) to (b), implement the portions of Senate Bill 1307 that changed provisions that related to only spouses or only to service members and veterans, and expanded the expedited process to cover all military applicants. SB 1307 also changed Chapter 55 of the Occupations Code to remove the requirement in Section 55.002 that to qualify for later renewal of a registration without an increase in fees or penalty, the military service member must be serving outside the state when on active duty. Section 55.003 was changed to permit a military service member two years of additional time to complete the requirements related to renewal of the license or registration. The text of new subsection (e) incorporates these changes and moves the other provisions related to renewals by military service members into 115.18 from 115.4. SB 807, which is effective September 1, 2015, made an additional change to Chapter 55 by providing for the waiver of an occupational license application fee and an examination fee paid to the state by certain military applicants. The history of the bill clarifies that the application fee waiver is for the initial application only and not for renewals of the license or registration. The examination fee waiver applies only to fees paid to the State of Texas, so would relate only to the fee paid to the Agency to take the Texas Securities Examination, not to fees paid to third parties to take any of the uniform examinations administered by FINRA. New subsection (c) of 115.18 would implement the SB 807 fee waivers. Since some qualifying filers (those filing through CRD or IARD) would have to pay the fee anyway to use the electronic system, the amendment also provides for a refund to an applicant who pays the fee. This would enable electronic filers to take advantage of the fee waiver. To avoid problems associated with processing stale claims, the subsection provides that a refund request must be received within four years from the date the fee was collected or received. HB 7, also effective September 1st, repealed Section 41 of the Texas Securities Act that imposed the $200 professional fee on dealer, investment adviser, agent, and investment adviser representative applications and renewals. The amendment to 115.8, subsection (d), removes the reference to the Section 41 fee. The repeal of Section 41 fees effectively eliminates the Agency's mechanism for granting reduced fees to small businesses required to register in multiple capacities which was accomplished through subsection (b)(3) of 115.8. The proposed amendments to subsection (b)(3) would restructure the fee reduction to apply to the second set of Section 35.A fees (relating to registration as an investment adviser or investment adviser representative) so that a small business registered in multiple capacities would continue to receive a reduction in fees. Patricia Loutherback, Director, Registration Division, has determined that for the first five-year period 115.4 is in effect there 40 TexReg 6806 October 2, 2015 Texas Register

will be no foreseeable fiscal implications for state or local government as a result of enforcing or administering the rule. However, there will be fiscal implications as a result of enforcing or administering 115.8 and 115.18 on state, but not local, government. The effect on state government for the first five-year period that 115.8 will be in effect is an estimated loss in revenue in the form of reduced fees that would be paid by small businesses registered in multiple capacities. The dealer and agent fees will continue to be paid so the fiscal impact would be from the waiver of the investment adviser or investment adviser representation fees. Accordingly, the fiscal impact is addressed in the discussion of the amendment to 116.8. The effect on state government for the first five-year period that 115.18 will be in effect is an estimated loss in revenue as a result of the application and examination fee waivers that would be granted to military applicants. Although there would be a fiscal impact, it is the result of legislation rather than Agency rulemaking. A decrease in revenue resulting from the fee waivers was reflected in the fiscal note to SB 807. According to the Texas Comptroller of Public Accounts, "this bill would reduce state revenue from occupational license application and exam fees. However, insufficient data exist to determine how much revenue would be forgone. Therefore, the fiscal impact of the bill cannot be estimated." Two military applicants would have been eligible for waiver of the application fee in fiscal year That number was four in fiscal year 2014. Based on these numbers, the anticipated fiscal impact is likely to be minor. Ms. Loutherback also has determined that for each year of the first five years the rules are in effect the public benefit anticipated as a result of enforcing the rules will be that a military applicant licensed in another jurisdiction or with comparable military service, training, or education can request special consideration or credit for such licensure or experience as well as expedited review of an application for registration. There will be no effect on micro- or small businesses. Since the rules will have no adverse economic effect on micro- or small businesses, preparation of an economic impact statement and a regulatory flexibility analysis is not required. There is no anticipated economic cost to persons who are required to comply with the rules as proposed. There is no anticipated impact on local employment. Comments on the proposal must be in writing and will be accepted for 30 days following publication of the proposed sections in the Texas Register. Written comments should be submitted to Marlene K. Sparkman, General Counsel, State Securities Board, P.O. Box 13167, Austin, Texas 78711-3167 or faxed to (512) 305-8336. Comments may also be submitted electronically to proposal@ssb.texas.gov. In order to be considered by the Board at adoption, comments must be received no later than 30 days following publication. The amendments are proposed under Texas Civil Statutes, Article 581-28-1 and Chapter 55 of the Texas Occupations Code. Section 28-1 provides the Board with the authority to adopt rules and regulations necessary to carry out and implement the provisions of the Texas Securities Act, including rules and regulations governing registration statements and applications; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes. Chapter 55 of the Texas Occupations Code authorizes the agency to adopt rules for licensure or registration of a person who is a military spouse, military service member, or military veteran who meets certain criteria. The proposals affect Texas Civil Statutes, Articles 581 12, 581-13, 581-14, 581-15, and 581-18. 115.4. Evidences of Registration. (a) - (d) (No change.) (e) Renewal. (1) - (2) (No change.) (3) If a person's registration is not renewed in a timely manner because such person is a military service member, as defined in 115.18(a) of this chapter (relating to Special Provisions Relating to Military Applicants) [or was on active duty with the armed forces of the United States of America serving outside Texas], such person may renew the registration pursuant to the provisions of 115.18(e) [this paragraph]. [(A) Renewal of the registration may be requested by such person, such person's spouse, or an individual having power of attorney from such person. The renewal application shall include a current address and telephone number for the individual requesting the renewal.] [(B) Renewal may be requested before or after expiration of the registration.] [(C) A copy of the official orders or other official military documentation showing that such person is or was on active duty serving outside Texas shall be submitted to the Securities Commissioner along with the renewal application.] [(D) A copy of the power of attorney from such person, if any, shall be filed with the Securities Commissioner along with the renewal application if the individual having the power of attorney executes any of the documents required in this paragraph.] [(E) A renewal application submitted to the Securities Commissioner pursuant to this paragraph shall be accompanied by the applicable renewal fee set out in 115.8 of this title (relating to Fee Requirements).] [(F) The State Securities Board will not assess any increased fee or other penalty against the person for failure to timely renew such person's registration if such person establishes to the satisfaction of the Securities Commissioner that all requirements of this paragraph have been met.] 115.8. Fee Requirements. (a) (No change.) (b) Reduced fees for certain persons [person] registered in multiple capacities. (1) - (2) (No change.) (3) Reduced fees. If the Securities Commissioner grants a person's request, the person must pay all applicable fees for securities agent or dealer registration as specified in the Texas Securities Act, 35.A [ 35.A(2), 35.A(4), 35.A(5), and 41(a)], but is exempt from the fees specified in the Texas Securities Act, 35.A [ 41(a)], in connection with original and renewal applications for investment adviser representative or sole proprietor investment adviser registration, as applicable at the time Form 133.36 is filed. The reduction in fees granted by the Securities Commissioner under this subsection shall continue in force, without any further filings, as long as a person remains registered in a multiple capacity status. (c) (No change.) (d) Fees for concurrent registrations. Notwithstanding the Texas Securities Act, 35 [ 35 and 41], a person shall pay only one PROPOSED RULES October 2, 2015 40 TexReg 6807

fee required under that section [those sections] to engage in business in this state concurrently for the same person or company as: (1) a dealer and an investment adviser; or (2) an agent and an investment adviser representative. (e) Waiver of initial application fee and examination fee for certain military applicants. A military applicant who meets the requirements in 115.18(c) of this chapter (relating to Special Provisions Relating to Military Applicants) is eligible to have his or her initial application fee in Texas and the fee to take the Texas Securities Law Examination waived or refunded by following the procedure set out in 115.18(c). 115.18. Special [Application] Provisions Relating [Available] to [a] Military Applicants [Spouse, Military Service Member, or Military Veteran]. (a) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise. (1) - (2) (No change.) (3) Military spouse--a person [An applicant] who is married to a military service member [who is currently on active duty]. (4) Military service member--a person who is on active duty [currently serving in the armed forces of the United States, in a reserve component of the armed forces of the United States, including the National Guard, or in the state military service of any state]. (5) Military veteran--a person who has served on active duty and who was discharged or released from active duty [in the Army, Navy, Air Force, Marine Corps, or Coast Guard of the United States, or in the auxiliary service of one of those branches of the armed forces]. (6) Active duty--current full-time military service in the armed forces of the United States or active duty military service as a member of the Texas military forces, as defined by Government Code, Section 437.001, or similar military service of another state. (7) Armed forces of the United States--The Army, Navy, Air Force, Coast Guard, or Marine Corps of the United States or a reserve unit of one of those branches of the armed forces. (8) Military applicant--a military spouse, military service member, or military veteran. (b) Expedited review of an application submitted by [Alternative procedure for] a military applicant [spouse] as authorized by Occupations Code, 55.004-55.006 [ 55.004]. (1) A military [An] applicant [who is a military spouse] may use the procedure set out in this subsection if the military applicant: (A) [the applicant] holds a current registration in another jurisdiction; or (B) has been registered in Texas in the same capacity within the five years preceding the date of the application for registration[, but whose registration in Texas expired while the applicant lived in another state for at least six months]. (2) If the military applicant is not registered within five days of submitting an application, the military applicant may request special consideration of his or her application for registration by filing Form 133.4, Request for [Special] Consideration of a Registration Application by a Military Applicant [Spouse, Military Service Member, or Military Veteran], with the Securities Commissioner ("Commissioner"). Within five business days of receipt of the completed Form 133.4, the military applicant will be notified in writing of the reason(s) for the pending or deficient status assigned to the application. (3) In addition to the waivers of examination requirements set out in 115.3 of this title (relating to Examination), the Commissioner in his or her discretion is authorized by the Board to grant full or partial waivers of the examination requirements of the Texas Securities Act, 13.D, on a showing of alternative demonstrations of competency to meet the requirements for obtaining the registration sought. (4) A military applicant proceeding under this subsection may be registered despite having pending and/or deficient items ("deficiencies"). The deficiencies will be communicated to the military applicant in writing or by electronic means within five business days from approval of the registration. (5) The deficiencies noted at the time the registration is granted must be resolved by the military applicant within a 12 month period. Failure to resolve outstanding deficiencies will cause the registration granted under this subsection or any renewal of such registration to automatically terminate 12 months after the date the registration was initially granted pursuant to this subsection. (c) Waiver or refund of initial application fee and Texas Securities Law Examination fee for a military applicant as authorized by Occupations Code, 55.009. (1) To qualify for a fee waiver or refund, the applicant must be: (A) a military applicant who holds a current registration in another jurisdiction; or (B) a military service member or military veteran whose military service, training, or education substantially meets all the requirements for the registration sought who submits Form 133.4, Request for Consideration of a Registration Application by a Military Applicant, with the applicant's registration application. (2) To request a waiver or refund of a fee previously paid, the applicant must submit Form 133.19, Waiver or Refund Request by a Military Applicant. (A) If requesting a waiver of the fee to take the Texas Securities Law Examination, Form 133.19 must be submitted when filing the request to take the Texas Securities Law Examination. (B) If requesting a waiver of the initial application fee, Form 133.19 must be submitted with the initial application. (C) If requesting a refund of the initial application fee or Texas Securities Law Examination fee that was paid in error, Form 133.19 must be submitted within four years from the date the fee was collected or received. [(c) Expedited review of an application submitted by a military spouse as authorized by Occupations Code, 55.005 and 55.006.] [(1) An applicant who is a military spouse may use the procedure set out in this subsection if the applicant holds a current registration in another jurisdiction.] [(2) If the applicant is not registered within five days of submitting an application, the applicant may request special consideration of his or her application for registration by filing Form 133.4, Request for Special Consideration of a Registration Application by a Military Spouse, Military Service Member, or Military Veteran, with the Commissioner.] [(3) An applicant proceeding under this subsection may be registered despite having pending and/or deficient items ("deficiencies"). The deficiencies will be communicated to the applicant in writ- 40 TexReg 6808 October 2, 2015 Texas Register

ing or by electronic means within five business days from approval of the registration.] [(4) The deficiencies noted at the time the registration is granted must be resolved by the applicant within a 12 month period. Failure to resolve outstanding deficiencies will cause the registration granted under this subsection or any renewal of such registration to automatically terminate 12 months after the date the registration was initially granted pursuant to this subsection.] (d) Registration of persons with military experience as authorized by Occupations Code, 55.007. (1) An applicant who is a military service member or military veteran may request special consideration of verified military service, training, or education towards registration requirements, other than an examination requirement, for the registration sought by submitting Form 133.4, Request for [Special] Consideration of a Registration Application by a Military Applicant [Spouse, Military Service Member, or Military Veteran], with the applicant's registration application. (2) (No change.) (e) Renewals by military service members. If a military service member's registration is not renewed in a timely manner, the military service member may renew the registration pursuant to this subsection. (1) Renewal of the registration may be requested by the military service member, the military service member's spouse, or an individual having power of attorney from the military service member. The renewal application shall include a current address and telephone number for the individual requesting the renewal. (2) Renewal may be requested before or within two years after expiration of the registration. (3) A copy of the official orders or other official military documentation showing that the military service member is or was on active duty shall be submitted to the Securities Commissioner along with the renewal application. (4) A copy of the power of attorney from the military service member, if any, shall be filed with the Securities Commissioner along with the renewal application if the individual having the power of attorney executes any of the documents required in this subsection. (5) A renewal application submitted to the Securities Commissioner pursuant to this subsection shall be accompanied by the applicable renewal fee set out in 115.8 of this title (relating to Fee Requirements). (6) The State Securities Board will not assess any increased fee or other penalty against the military service member for failure to timely renew the registration if it is established to the satisfaction of the Securities Commissioner that all requirements of this subsection have been met. (f) [(e)] Other provisions in this chapter. (1) Unless specifically allowed in this section, an applicant must meet the requirements for registration or renewal specified in this chapter. This includes the requirement that certain filings be made electronically through the CRD. (2) A one-year period, instead of the 90-day period contained in 115.2 of this title (relating to Application Requirements), will apply to the automatic withdrawal of an application for which a Form 133.4 is properly filed. (g) [(f)] Additional information. An applicant receiving special consideration pursuant to this section in connection with a registration application or renewal shall provide any other information deemed necessary by the Commissioner. Such information may include, but is not limited to documentation: (1) demonstrating status as a military spouse, service member, or military veteran; (2) to determine whether the applicant meets licensing requirements through some alternative method; (3) relating to prior military service, training, or education that may be credited towards a registration requirement; or (4) to determine a dealer's financial responsibility or a dealer's or agent's business repute or qualifications. Filed with the Office of the Secretary of State on September 16, TRD-201503808 John Morgan Securities Commissioner State Securities Board For further information, please call: (512) 305-8301 CHAPTER 116. INVESTMENT ADVISERS AND INVESTMENT ADVISER REPRESENTA- TIVES 7 TAC 116.4, 116.8, 116.18 The Texas State Securities Board proposes amendments to 116.4, concerning evidences of registration, 116.8, concerning fee requirements, and 116.18, concerning special application provisions available to a military spouse, military service member, or military veteran. The proposals are required by Senate Bill 1307, Senate Bill 807, and House Bill 7, passed by the 84th Texas Legislature. Related forms are being concurrently proposed as are comparable amendments to the corresponding rules for dealers and agents. SB 1307, effective for applications or renewals filed on or after January 1, 2016, changed Chapter 55 of the Occupations Code relating to occupational licenses and registrations issued to military service members, military veterans, and military spouses (collectively, military applicants). Among its provisions, it requires that a state agency post a notice on its website describing the provisions available to military applicants. To simplify how this notice will be provided, the provisions that relate to military applicants are being relocated to 116.18. Accordingly, portions of subsection (e) of 116.4 would be amended to move the substantive portions relating to renewals by military service members to 116.18. SB 1307 is applicable to applications and renewals filed on or after January 1, 2016. The amendments to 116.18 incorporate those statutory changes. Specifically, the definitions in subsection (a) have been amended to conform to the statute. The changes to subsection (b), elimination of most of current subsection (c), and relocation of the remainder of current subsection (c) to (b), implement the portions of Senate Bill 1307 that changed PROPOSED RULES October 2, 2015 40 TexReg 6809

provisions that related to only spouses or only to service members and veterans, and expanded the expedited process to cover all military applicants. SB 1307 also changed Chapter 55 of the Occupations Code to remove the requirement in Section 55.002 that to qualify for later renewal of a registration without an increase in fees or penalty, the military service member must be serving outside the state when on active duty. Section 55.003 was changed to permit a military service member two years of additional time to complete the requirements related to renewal of the license or registration. The text of new subsection (e) incorporates these changes and moves the other provisions related to renewals by military service members into 116.18 from 116.4. SB 807, which is effective September 1, 2015, made an additional change to Chapter 55 by providing for the waiver of an occupational license application fee and an examination fee paid to the state by certain military applicants. The history of the bill clarifies that the application fee waiver is for the initial application only and not for renewals of the license or registration. The examination fee waiver applies only to fees paid to the State of Texas, so would relate only to the fee paid to the Agency to take the Texas Securities Examination, not to fees paid to third parties to take any of the uniform examinations administered by FINRA. New subsection (c) of 116.18 would implement the SB 807 fee waivers. Since some qualifying filers (those filing through CRD or IARD) would have to pay the fee anyway to use the electronic system, the amendment also provides for a refund to an applicant who pays the fee. This would enable electronic filers to take advantage of the fee waiver. To avoid problems associated with processing stale claims, the subsection provides that a refund request must be received within four years from the date the fee was collected or received. HB 7, also effective September 1st, repealed Section 41 of the Texas Securities Act that imposed the $200 professional fee on dealer, investment adviser, agent, and investment adviser representative applications and renewals. The amendment to 116.8, subsection (d), removes the reference to the Section 41 fee. The repeal of Section 41 fees effectively eliminates the Agency's mechanism for granting reduced fees to small businesses required to register in multiple capacities which was accomplished through subsection (b)(3) of 116.8. The proposed amendments to subsection (b)(3) would restructure the fee reduction to apply to the second set of Section 35.A fees so that a small business registered in multiple capacities would continue to receive a reduction in fees. Patricia Loutherback, Director, Registration Division, has determined that for the first five-year period 116.4 is in effect there will be no foreseeable fiscal implications for state or local government as a result of enforcing or administering the rule. However, there will be fiscal implications as a result of enforcing or administering 116.8 and 116.18 on state, but not local, government. The effect on state government for the first five-year period that 116.8 will be in effect is an estimated loss in revenue in the form of reduced fees that would be paid by small businesses registered in multiple capacities. The fiscal impact would be minor given the small number of applicants who have requested reduced fees under this provision--11 (6 advisers and 5 representatives) in fiscal year 2015; 12 (6 advisers and 6 representatives) in fiscal year 2014; and 16 (6 advisers and 10 representatives) in fiscal year 2013. Using an average of the number and types of fees involved (6 advisers and 7 representatives), the fiscal impact when the rule becomes effective, based on reduced Section 35.A fees that go into effect on September 1, 2015, would be approximately a $380 per year reduction in fees collected. The effect on state government for the first five-year period that 116.18 will be in effect is an estimated loss in revenue as a result of the application and examination fee waivers that would be granted to military applicants. Although there would be a fiscal impact, it is the result of legislation rather than Agency rulemaking. A decrease in revenue resulting from the fee waivers was reflected in the fiscal note to SB 807. According to the Texas Comptroller of Public Accounts, "this bill would reduce state revenue from occupational license application and exam fees. However, insufficient data exist to determine how much revenue would be forgone. Therefore, the fiscal impact of the bill cannot be estimated." Two military applicants would have been eligible for waiver of the application fee in fiscal year That number was four in fiscal year 2014. Based on these numbers, the anticipated fiscal impact is likely to be minor. Ms. Loutherback also has determined that for each year of the first five years the rules are in effect the public benefit anticipated as a result of enforcing the rules will be that a military applicant licensed in another jurisdiction or with comparable military service, training, or education can request special consideration or credit for such licensure or experience as well as expedited review of an application for registration. There will be no effect on micro- or small businesses. Since the rules will have no adverse economic effect on micro- or small businesses, preparation of an economic impact statement and a regulatory flexibility analysis is not required. There is no anticipated economic cost to persons who are required to comply with the rules as proposed. There is no anticipated impact on local employment. Comments on the proposal must be in writing and will be accepted for 30 days following publication of the proposed sections in the Texas Register. Written comments should be submitted to Marlene K. Sparkman, General Counsel, State Securities Board, P.O. Box 13167, Austin, Texas 78711-3167 or faxed to (512) 305-8336. Comments may also be submitted electronically to proposal@ssb.texas.gov. In order to be considered by the Board at adoption, comments must be received no later than 30 days following publication. The amendments are proposed under Texas Civil Statutes, Article 581-28-1 and Chapter 55 of the Texas Occupations Code. Section 28-1 provides the Board with the authority to adopt rules and regulations necessary to carry out and implement the provisions of the Texas Securities Act, including rules and regulations governing registration statements and applications; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes. Chapter 55 of the Texas Occupations Code authorizes the agency to adopt rules for licensure or registration of a person who is a military spouse, military service member, or military veteran who meets certain criteria. The proposals affect Texas Civil Statutes, Articles 581 12, 581-13, 581-14, 581-15, and 581-18. 116.4. Evidences of Registration. (a) - (d) (No change.) (e) Renewal. (1) - (2) (No change.) (3) If a person's registration is not renewed in a timely manner because such person is a military service member as defined in 40 TexReg 6810 October 2, 2015 Texas Register

116.18(a) of this chapter (relating to Special Provisions Relating to Military Applicants) [or was on active duty with the armed forces of the United States of America serving outside Texas], such person may renew the registration pursuant to the provisions of 116.18(e) [this paragraph]. [(A) Renewal of the registration may be requested by such person, such person's spouse, or an individual having power of attorney from such person. The renewal application shall include a current address and telephone number for the individual requesting the renewal.] [(B) Renewal may be requested before or after expiration of the registration.] [(C) A copy of the official orders or other official military documentation showing that such person is or was on active duty serving outside Texas shall be submitted to the Securities Commissioner along with the renewal application.] [(D) A copy of the power of attorney from such person, if any, shall be filed with the Securities Commissioner along with the renewal application if the individual having the power of attorney executes any of the documents required in this paragraph.] [(E) A renewal application submitted to the Securities Commissioner pursuant to this paragraph shall be accompanied by the applicable renewal fee set out in 116.8 of this title (relating to Fee Requirements).] [(F) The State Securities Board will not assess any increased fee or other penalty against the person for failure to timely renew such person's registration if such person establishes to the satisfaction of the Securities Commissioner that all requirements of this paragraph have been met.] 116.8. Fee Requirements. (a) (No change.) (b) Reduced fees for certain persons [person] registered in multiple capacities. (1) - (2) (No change.) (3) Reduced fees. If the Securities Commissioner grants a person's request, the person must pay all applicable fees for registration as a dealer or dealer's agent as specified in the Texas Securities Act, 35.A [ 35.A(2), 35.A(4), 35.A(5), and 41(a)], but is exempt from the fees specified in the Texas Securities Act, 35.A [ 41(a)], in connection with original and renewal applications for registration as an investment adviser representative or sole proprietor investment adviser, as applicable at the time Form 133.36 is filed. The reduction in fees granted by the Securities Commissioner under this subsection shall continue in force, without any further filings, as long as a person remains registered in a multiple capacity status. (c) (No change.) (d) Fees for concurrent registrations. Notwithstanding the Texas Securities Act, 35 [ 35 and 41], a person shall pay only one fee required under that section [those sections] to engage in business in this state concurrently for the same person or company as: (1) a dealer and an investment adviser; or (2) an agent and an investment adviser representative. (e) Waiver of initial application fee and examination fee for certain military applicants. A military applicant who meets the requirements in 116.18(c) of this chapter (relating to Special Provisions Relating to Military Applicants) is eligible to have his or her initial application fee in Texas and the fee to take the Texas Securities Law Examination waived or refunded by following the procedure set out in 116.18(c). 116.18. Special [Application] Provisions Relating [Available] to [a] Military Applicants [Spouse, Military Service Member, or Military Veteran]. (a) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise. (1) - (2) (No change.) (3) Military spouse--a person [An applicant] who is married to a military service member [who is currently on active duty]. (4) Military service member--a person who is on active duty. [currently serving in the armed forces of the United States, in a reserve component of the armed forces of the United States, including the National Guard, or in the state military service of any state.] (5) Military veteran--a person who has served on active duty and who was discharged or released from active duty. [in the Army, Navy, Air Force, Marine Corps, or Coast Guard of the United States, or in the auxiliary service of one of those branches of the armed forces.] (6) Active duty--current full-time military service in the armed forces of the United States or active duty military service as a member of the Texas military forces, as defined by Government Code, 437.001, or similar military service of another state. (7) Armed forces of the United States--The Army, Navy, Air Force, Coast Guard, or Marine Corps of the United States or a reserve unit of one of those branches of the armed forces. (8) Military applicant--a military spouse, military service member, or military veteran. (b) Expedited review of an application submitted by [Alternative procedure for] a military applicant [spouse] as authorized by Occupations Code, 55.004-55.006 [ 55.004]. (1) A military [An] applicant [who is a military spouse] may use the procedure set out in this subsection if the military applicant: (A) [the applicant] holds a current registration in another jurisdiction; or (B) has been registered in Texas in the same capacity within the five years preceding the date of the application for registration[, but whose registration in Texas expired while the applicant lived in another state for at least six months]. (2) If the military applicant is not registered within five days of submitting an application, the military applicant may request special consideration of his or her application for registration by filing Form 133.4, Request for [Special] Consideration of a Registration Application by a Military Applicant [Spouse, Military Service Member, or Military Veteran], with the Securities Commissioner ("Commissioner"). Within five business days of receipt of the completed Form 133.4, the military applicant will be notified in writing of the reason(s) for the pending or deficient status assigned to the application. (3) In addition to the waivers of examination requirements set out in 116.3 of this title (relating to Examination), the Commissioner in his or her discretion is authorized by the Board to grant full or partial waivers of the examination requirements of the Texas Securities Act, Section 13.D, on a showing of alternative demonstrations of competency to meet the requirements for obtaining the registration sought. PROPOSED RULES October 2, 2015 40 TexReg 6811

(4) A military applicant proceeding under this subsection may be registered despite having pending and/or deficient items ("deficiencies"). The deficiencies will be communicated to the military applicant in writing or by electronic means within five business days from approval of the registration. (5) The deficiencies noted at the time the registration is granted must be resolved by the military applicant within a 12 month period. Failure to resolve outstanding deficiencies will cause the registration granted under this subsection or any renewal of such registration to automatically terminate 12 months after the date the registration was initially granted pursuant to this subsection. (c) Waiver or refund of initial application fee and Texas Securities Law Examination fee for a military applicant as authorized by Occupations Code, 55.009. be: (1) To qualify for a fee waiver or refund, the applicant must (A) a military applicant who holds a current registration in another jurisdiction; or (B) a military service member or military veteran whose military service, training, or education substantially meets all the requirements for the registration sought who submits Form 133.4, Request for Consideration of a Registration Application by a Military Applicant, with the applicant's registration application. (2) To request a waiver or refund of a fee previously paid, the applicant must submit Form 133.19, Waiver or Refund Request by a Military Applicant. (A) If requesting a waiver of the fee to take the Texas Securities Law Examination, Form 133.19 must be submitted when filing the request to take the Texas Securities Law Examination. (B) If requesting a waiver of the initial application fee, Form 133.19 must be submitted with the initial application. (C) If requesting a refund of the initial application fee or Texas Securities Law Examination fee that was paid in error, Form 133.19 must be submitted within four years from the date the fee was collected or received. [(c) Expedited review of an application submitted by a military spouse as authorized by Occupations Code, 55.005 and 55.006.] [(1) An applicant who is a military spouse may use the procedure set out in this subsection if the applicant holds a current registration in another jurisdiction.] [(2) If the applicant is not registered within five days of submitting an application, the applicant may request special consideration of his or her application for registration by filing Form 133.4, Request for Special Consideration of a Registration Application by a Military Spouse, Military Service Member, or Military Veteran, with the Commissioner.] [(3) An applicant proceeding under this subsection may be registered despite having pending and/or deficient items ("deficiencies"). The deficiencies will be communicated to the applicant in writing or by electronic means within five business days from approval of the registration.] [(4) The deficiencies noted at the time the registration is granted must be resolved by the applicant within a 12 month period. Failure to resolve outstanding deficiencies will cause the registration granted under this subsection or any renewal of such registration to automatically terminate 12 months after the date the registration was initially granted pursuant to this subsection.] (d) Registration of persons with military experience as authorized by Occupations Code, 55.007. (1) An applicant who is a military service member or military veteran may request special consideration of verified military service, training, or education towards registration requirements, other than an examination requirement, for the registration sought by submitting Form 133.4, Request for [Special] Consideration of a Registration Application by a Military Applicant [Spouse, Military Service Member, or Military Veteran], with the applicant's registration application. (2) (No change.) (e) Renewals by military service members. If a military service member's registration is not renewed in a timely manner, the military service member may renew the registration pursuant to this subsection. (1) Renewal of the registration may be requested by the military service member, the military service member's spouse, or an individual having power of attorney from the military service member. The renewal application shall include a current address and telephone number for the individual requesting the renewal. (2) Renewal may be requested before or within two years after expiration of the registration. (3) A copy of the official orders or other official military documentation showing that the military service member is or was on active duty shall be submitted to the Securities Commissioner along with the renewal application. (4) A copy of the power of attorney from the military service member, if any, shall be filed with the Securities Commissioner along with the renewal application if the individual having the power of attorney executes any of the documents required in this subsection. (5) A renewal application submitted to the Securities Commissioner pursuant to this subsection shall be accompanied by the applicable renewal fee set out in 116.8 of this title (relating to Fee Requirements). (6) The State Securities Board will not assess any increased fee or other penalty against the military service member for failure to timely renew the registration if it is established to the satisfaction of the Securities Commissioner that all requirements of this subsection have been met. (f) [(e)] Other provisions in this chapter. (1) Unless specifically allowed in this section, an applicant must meet the requirements for registration or renewal specified in this chapter. This includes the requirement that certain filings be made electronically through the IARD. (2) A one-year period, instead of the 90-day period contained in 116.2 of this title (relating to Application Requirements), will apply to the automatic withdrawal of an application for which a Form 133.4 is properly filed. (g) [(f)] Additional information. An applicant receiving special consideration pursuant to this section in connection with a registration application or renewal shall provide any other information deemed necessary by the Commissioner. Such information may include, but is not limited to documentation: (1) demonstrating status as a military spouse, service member, or military veteran; (2) to determine whether the applicant meets licensing requirements through some alternative method; 40 TexReg 6812 October 2, 2015 Texas Register

(3) relating to prior military service, training, or education that may be credited towards a registration requirement; or (4) to determine an investment adviser's financial responsibility or an investment adviser's or investment adviser representative's business repute or qualifications. Filed with the Office of the Secretary of State on September 16, TRD-201503809 John Morgan Securities Commissioner State Securities Board For further information, please call: (512) 305-8301 CHAPTER 133. FORMS 7 TAC 133.4 (Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the State Securities Board or in the Texas Register office, James Earl Rudder Building, 1019 Brazos Street, Austin, Texas.) The Texas State Securities Board proposes the repeal of 133.4, which adopts by reference a form concerning request for special consideration of a registration application by a military spouse, military service member, or military veteran. Repeal of the existing form would allow for the simultaneous adoption of a new form, which is being concurrently proposed. Patricia Loutherback, Director, Registration Division, has determined that for the first five-year period the repeal is in effect there will be no foreseeable fiscal implications for state or local government as a result of enforcing or administering the repeal. Ms. Loutherback also has determined that for each year of the first five years the repeal is in effect the public benefit anticipated as a result of enforcing the repeal will be that a military service member, military spouse, or military veteran (collectively, military applicants) licensed in another jurisdiction or with comparable military service, training, or education can complete the form to request special consideration or credit for such licensure or experience as well as expedited review of an application for registration pursuant to 115.18 or 116.18. There will be no effect on micro- or small businesses. Since the repeal will have no adverse economic effect on micro- or small businesses, preparation of an economic impact statement and a regulatory flexibility analysis is not required. There is no anticipated economic cost to persons who are required to comply with the repeal as proposed. There is no anticipated impact on local employment. Comments on the proposal must be in writing and will be accepted for 30 days following publication of the proposed repeal in the Texas Register. Written comments should be submitted to Marlene K. Sparkman, General Counsel, State Securities Board, P.O. Box 13167, Austin, Texas 78711-3167 or faxed to (512) 305-8336. Comments may also be submitted electronically to proposal@ssb.texas.gov. In order to be considered by the Board at adoption, comments must be received no later than 30 days following publication. The repeal is proposed under Texas Civil Statutes, Article 581-28-1 and Chapter 55 of the Texas Occupations Code. Section 28-1 provides the Board with the authority to adopt rules and regulations necessary to carry out and implement the provisions of the Texas Securities Act, including rules and regulations governing registration statements and applications; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes. Chapter 55 of the Texas Occupations Code authorizes the agency to adopt rules for licensure or registration of a person who is a military spouse, military service member, or military veteran who meets certain criteria. The proposal affects Texas Civil Statutes, Articles 581 12, 581-13, 581-14, 581-15, and 581-18. 133.4. Request for Special Consideration of a Registration Application by a Military Spouse, Military Service Member, or Military Veteran. Filed with the Office of the Secretary of State on September 16, TRD-201503811 John Morgan Securities Commissioner State Securities Board For further information, please call: (512) 305-8301 7 TAC 133.4 The Texas State Securities Board proposes new 133.4, which adopts by reference a form concerning request for consideration of a registration application by a military applicant. The form will allow a military service member, military spouse, or military veteran (collectively, military applicants) licensed in another jurisdiction or with comparable military service, training, or education to request special consideration or credit for such licensure or experience as well as expedited review of an application for registration pursuant to 115.18 or 116.18, which are being concurrently amended. Existing 133.4 is being concurrently proposed for repeal. Patricia Loutherback, Director, Registration Division, has determined that for the first five-year period the rule is in effect there will be no foreseeable fiscal implications for state or local government as a result of enforcing or administering the rule. Ms. Loutherback also has determined that for each year of the first five years the rule is in effect the public benefit anticipated as a result of enforcing the rule will be that a military applicant licensed in another jurisdiction or with comparable military service, training, or education can complete the form to request special consideration or credit for such licensure or experience as well as expedited review of an application for registration pursuant to 115.18 or 116.18. There will be no effect on microor small businesses. Since the rule will have no adverse economic effect on micro- or small businesses, preparation of an economic impact statement and a regulatory flexibility analysis PROPOSED RULES October 2, 2015 40 TexReg 6813

is not required. There is no anticipated economic cost to persons who are required to comply with the rule as proposed. There is no anticipated impact on local employment. Comments on the proposal must be in writing and will be accepted for 30 days following publication of the proposed rule in the Texas Register. Written comments should be submitted to Marlene K. Sparkman, General Counsel, State Securities Board, P.O. Box 13167, Austin, Texas 78711-3167 or faxed to (512) 305-8336. Comments may also be submitted electronically to proposal@ssb.texas.gov. In order to be considered by the Board at adoption, comments must be received no later than 30 days following publication. The rule is proposed under Texas Civil Statutes, Article 581-28-1 and Chapter 55 of the Texas Occupations Code. Section 28-1 provides the Board with the authority to adopt rules and regulations necessary to carry out and implement the provisions of the Texas Securities Act, including rules and regulations governing registration statements and applications; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes. Chapter 55 of the Texas Occupations Code authorizes the agency to adopt rules for licensure or registration of a person who is a military spouse, military service member, or military veteran who meets certain criteria. The proposal affects Texas Civil Statutes, Articles 581 12, 581-13, 581-14, 581-15, and 581-18. 133.4. Request for Consideration of a Registration Application by a Military Applicant. The State Securities Board adopts by reference Form 133.4, Request for Consideration of a Registration Application by a Military Applicant. This form is available from the State Securities Board, P.O. Box 13167, Austin, Texas 78711-3167 and at www.ssb.state.tx.us. Filed with the Office of the Secretary of State on September 16, TRD-201503810 John Morgan Securities Commissioner State Securities Board For further information, please call: (512) 305-8301 7 TAC 133.19 The Texas State Securities Board proposes new 133.19, which adopts by reference a form concerning waiver or refund request by a military applicant. The form will allow a military service member, military spouse, or military veteran (collectively, military applicants) to request a waiver or refund of the initial registration application fee or the fee to take the Texas Securities Law Examination under the new procedures to be established in 115.18 and 116.18, which are being concurrently amended. Patricia Loutherback, Director, Registration Division, has determined that for the first five-year period the rule is in effect there will be no foreseeable fiscal implications for state or local government as a result of enforcing or administering the rule. Ms. Loutherback also has determined that for each year of the first five years the rule is in effect the public benefit anticipated as a result of enforcing the rule will be that a military applicant can complete the form to request a waiver or refund of the initial application fee or the fee to take the Texas Securities Law Examination. There will be no effect on micro- or small businesses. Since the rule will have no adverse economic effect on micro- or small businesses, preparation of an economic impact statement and a regulatory flexibility analysis is not required. There is no anticipated economic cost to persons who are required to comply with the rule as proposed. There is no anticipated impact on local employment. Comments on the proposal must be in writing and will be accepted for 30 days following publication of the proposed rule in the Texas Register. Written comments should be submitted to Marlene K. Sparkman, General Counsel, State Securities Board, P.O. Box 13167, Austin, Texas 78711-3167 or faxed to (512) 305-8336. Comments may also be submitted electronically to proposal@ssb.texas.gov. In order to be considered by the Board at adoption, comments must be received no later than 30 days following publication. The rule is proposed under Texas Civil Statutes, Article 581-28-1 and Chapter 55 of the Texas Occupations Code. Section 28-1 provides the Board with the authority to adopt rules and regulations necessary to carry out and implement the provisions of the Texas Securities Act, including rules and regulations governing registration statements and applications; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes. Chapter 55 of the Texas Occupations Code authorizes the agency to adopt rules for licensure or registration of a person who is a military spouse, military service member, or military veteran who meets certain criteria. The proposal affects Texas Civil Statutes, Articles 581 12, 581-13, 581-15, and 581-18. 133.19. Waiver or Refund Request by a Military Applicant. The State Securities Board adopts by reference Form 133.19, Waiver or Refund Request by a Military Applicant. This form is available from the State Securities Board, P.O. Box 13167, Austin, Texas 78711-3167 and at www.ssb.state.tx.us. Filed with the Office of the Secretary of State on September 16, TRD-201503812 John Morgan Securities Commissioner State Securities Board For further information, please call: (512) 305-8301 CHAPTER 139. EXEMPTIONS BY RULE OR ORDER 7 TAC 139.12 40 TexReg 6814 October 2, 2015 Texas Register

The Texas State Securities Board proposes an amendment to 139.12, concerning oil and gas auction exemption. The proposal would add "associate auctioneer," a new type of registration under the Texas Occupations Code added by House Bill 2481, effective September 1, An "associate auctioneer" is an individual who, for compensation, is employed by and under the direct supervision of a licensed auctioneer to sell or offer to sell property at an auction. The proposal also eliminates the reference to an "auction company" licensed by the Texas Department of Licensing and Regulation since there is no such equivalent license in Chapter 1802 of the Texas Occupations Code. Patricia Loutherback, Director, Registration Division, has determined that for the first five-year period the rule is in effect there will be no foreseeable fiscal implications for state or local government as a result of enforcing or administering the rule. Ms. Loutherback also has determined that for each year of the first five years the rule is in effect the public benefit anticipated as a result of enforcing the rule will be to correctly identify the licensed persons who may act as an auctioneer for purposes of the exemption. There will be no effect on micro- or small businesses. Since the rule will have no adverse economic effect on micro- or small businesses, preparation of an economic impact statement and a regulatory flexibility analysis is not required. There is no anticipated economic cost to persons who are required to comply with the rule as proposed. There is no anticipated impact on local employment. Comments on the proposal must be in writing and will be accepted for 30 days following publication of the proposed section in the Texas Register. Written comments should be submitted to Marlene K. Sparkman, General Counsel, State Securities Board, P.O. Box 13167, Austin, Texas 78711 3167 or faxed to (512) 305 8336. Comments may also be submitted electronically to proposal@ssb.texas.gov. In order to be considered by the Board at adoption, comments must be received no later than 30 days following publication. The amendment is proposed under Texas Civil Statutes, Articles 581-5.T and Article 581-28-1. Section 5.T provides that the Board may prescribe new exemptions by rule. Section 28-1 provides the Board with the authority to adopt rules and regulations necessary to carry out and implement the provisions of the Texas Securities Act, including rules and regulations governing registration statements and applications; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes. The proposal affects Texas Civil Statutes, Articles 581 5, 581-7, and 581-12. 139.12. Oil and Gas Auction Exemption. For purposes of this rule only, the term "mineral interest" means an interest in or under an oil, gas, or mining lease, fee, or title, including real property from which the minerals have not been severed, or contracts relating thereto. The offer and sale of a mineral interest, at an auction, by the seller itself, or a registered dealer or agent acting on behalf of the seller, is exempt from the securities registration requirements of the Texas Securities Act, Section 7, if all of the following conditions are met. (1) Auctioneer. The auctioneer or associate auctioneer [or auction company] through which the mineral interest is offered or sold must be licensed as a dealer under the Texas Securities Act and licensed by the Texas Department of Licensing and Regulation in accordance with Texas Occupations Code, 1802.001 et. seq. (2) - (6) (No change.) Filed with the Office of the Secretary of State on September 16, TRD-201503813 John Morgan Securities Commissioner State Securities Board For further information, please call: (512) 305-8300 TITLE 16. ECONOMIC REGULATION PART 1. RAILROAD COMMISSION OF TEXAS CHAPTER 3. OIL AND GAS DIVISION 16 TAC 3.78 The Railroad Commission of Texas (Commission) proposes to amend 3.78, relating to Fees and Financial Security Requirements, in order to implement a fee for groundwater protection determination letters as provided in Texas Natural Resources Code, 91.0115(b). The proposed amendments also correct a form reference. Article 2 of House Bill 2694 (HB 2694), enacted by the 82nd Texas Legislature (Regular Session, 2011) amended Texas Natural Resources Code, Chapter 91, and Texas Water Code, Chapter 27, to transfer the Surface Casing Unit from the Texas Commission on Environmental Quality to the Railroad Commission of Texas. HB 2694 added 91.0115, Texas Natural Resources Code, relating to Casing; Letter of Determination, which transferred the responsibility for issuing a letter of determination stating the total depth of surface casing required for an oil or gas well by 91.011. Section 91.0115(b) authorized the Railroad Commission to charge a fee in an amount to be determined by the Railroad Commission for a letter of determination and to charge an additional fee not to exceed $75 for processing a request to expedite a letter of determination. These proposed amendments to 3.78 implement the Commission's authority to charge a fee for each request for a determination letter. The Commission will continue to charge an additional fee for a request to expedite a determination letter. The Commission proposes new subsection (a)(14) to add a definition for "Groundwater protection determination letter" to mean "a letter of determination stating the total depth of surface casing required for a well in accordance with Texas Natural Resources Code, 91.011." The Commission proposes to amend 3.78(b)(14) to add new subparagraph (A) to require a nonrefundable fee of $100 with each individual request for a groundwater protection determination letter. The Commission proposes to redesignate the existing language of 3.78(b)(14) concerning the fee for each individual application for an expedited letter of determination as 3.78(b)(14)(B). Pursuant to current 3.78(n), for which no amendments are proposed, a 150% surcharge would apply PROPOSED RULES October 2, 2015 40 TexReg 6815

to the $100 fee, for a total cost of $250 for each request for a groundwater protection determination letter. If an expedited letter is requested, the expedite fee and its surcharge will be charged in addition to the regular fee. The Commission also proposes to amend 3.78(b)(13)(A) to correct a reference to Form W-3X. Leslie Savage, Assistant Director for Technical Permitting, Oil and Gas Division, has determined that for each year of the first five years the amendments as proposed will be in effect, the fiscal implications with regard to the Commission's overall budget as a result of enforcing or administering the amendments will be a maximum cost of approximately $60,000. This cost is based on the estimated 600 hours of programming required to modify existing programs to add a new fee code and surcharge, modify the Commission's payment portal to accommodate the new fee code, and re-certify the new fee code through the payment portal. There will be no fiscal effect on local government. Ms. Savage has determined that for each year of the first five years that the amendments will be in effect the primary public benefit as a result of the proposed amendments will be the recovery of funds necessary for the Commission to perform the work required to prepare groundwater protection determination letters, including the study and evaluation of electronic access to geologic data and surface casing depths necessary to protect usable groundwater in this state. The Commission receives at least 18,000 requests for groundwater protection determination letters each year. Pursuant to current 3.78(n), which is not included in this rulemaking, a 150% surcharge would apply to the $100 fee. This surcharge would be used to recover the costs of performing the functions specified by Texas Natural Resources Code 81.068, including oil and gas monitoring and inspections, oil and gas remediation, oil and gas well plugging, alternative fuels programs under 81.0681, public information and services related to those activities, and administrative costs and state benefits for personnel involved in those activities. Ms. Savage has determined that for each year of the first five years that the amendments will be in effect, the economic cost for persons required to comply with the proposed amendments will be $250 for each request for a groundwater protection determination letter. Texas Government Code, 2006.002, relating to Adoption of Rules with Adverse Economic Effect, requires that, before adopting a rule that may have an adverse economic effect on small businesses or micro-businesses, a state agency prepare an economic impact statement and a regulatory flexibility analysis. The economic impact statement must estimate the number of small businesses subject to the proposed rule and project the economic impact of the rule on small businesses. A regulatory flexibility analysis must include the agency's consideration of alternative methods of achieving the purpose of the proposed rule. If consistent with the health, safety, and environmental and economic welfare of the state, the analysis must consider the use of regulatory methods that will accomplish the objectives of applicable rules while minimizing adverse impacts on small businesses. The statute defines "small business" as a legal entity, including a corporation, partnership, or sole proprietorship, that is formed for the purpose of making a profit; is independently owned and operated; and has fewer than 100 employees or less than $6 million in annual gross receipts. A "micro-business" is a legal entity, including a corporation, partnership, or sole proprietorship, that is formed for the purpose of making a profit; is independently owned and operated; and has no more than 20 employees. Entities that perform activities under the jurisdiction of the Commission are not required to report to the Commission their number of employees or their annual gross receipts, which are elements of the definitions of "micro-business" and "small business" in Texas Government Code, 2006.001; therefore, the Commission has no factual bases for determining whether any persons who request groundwater protection determination letters (i.e., persons who drill and plug wells under Commission jurisdiction) will be classified as small businesses or micro-businesses, as those terms are defined. However, because small and micro-businesses represent a large percentage of entities operating in the crude oil and natural gas extraction industry, and based on the information available to the Commission regarding oil and gas operators, Ms. Savage has concluded that it is likely that many of the businesses affected by the proposed amendments would be classified as small businesses, and possible that some could be classified as micro-businesses, as those terms are defined in Texas Government Code, 2006.001. The proposed amendments would result in increased costs in drilling and/or plugging a well, as a groundwater determination letter is required for these activities. However, Ms. Savage anticipates that the adverse impact to any one business (approximately $250 for the cost of each request for a groundwater determination letter, as described above) will be relatively small compared to the overall costs associated with drilling a well. Advanced Resources International (using API data) has reported that in 2007, the US oil and gas sector spent $226 billion drilling and equipping some 54,300 wells, for an average cost of $4.16 million per well. In 2007, it cost $4 million to drill an oil well and $3.9 million to drill a natural gas well, with an average cost of $574/foot of depth. In 2011, the cost to drill and complete a well in the Eagle Ford Shale ranged between $5.5 and 9.5 million. The lower ranges of costs reflect vertical wells, which are generally drilled by smaller operators. Also, the proposed rule requirements do not vary between large businesses and small or micro businesses. The overall costs attributable to the rule will vary with the individual circumstances of each entity. However, because the relative number of oil and/or natural gas wells an entity drills or plugs, and the corresponding number of requests for groundwater determination letters, should be proportionate to the relative size of the entity, the Commission anticipates that the proposal is likely to have a smaller cost impact on small or micro-businesses. Moreover, the Commission has determined that, because the purpose of the proposed amendments is to recover costs incurred in association with issuing groundwater protection determination letters, and because the letters prevent pollution of surface and subsurface waters, it is not feasible to reduce any economic impact of the rules on small or micro-businesses without compromising those efforts. In preparing the proposed rule, the Commission considered whether the purpose of the rule amendment could still be achieved if (1) small or micro-businesses pay a reduced fee for requests for groundwater determination letters, or (2) small or micro-businesses are exempt from the determination letter fee requirement. The Commission rejected these alternatives because the purpose of the rule amendment is to recover costs incurred in association with processing and preparing groundwater protection determination letters. The alternatives would not only impact the amount of funds the Commission could collect, but would also result in new costs to the Commission 40 TexReg 6816 October 2, 2015 Texas Register

due to the administrative burden of determining whether an individual request qualifies for a fee exemption or reduction. Ms. Savage has also determined that the proposed amendments will not affect a local economy. Therefore, the Commission has not prepared a local employment impact statement pursuant to Texas Government Code, 2001.022. Ms. Savage has determined that the amendments do not meet the statutory definition of a major environmental rule as set forth in Texas Government Code, 2001.0225(a); therefore, a regulatory analysis conducted pursuant to that section is not required. Comments on the proposal may be submitted to Rules Coordinator, Office of General Counsel, Railroad Commission of Texas, P.O. Box 12967, Austin, Texas 78711-2967; online at www.rrc.texas.gov/legal/rules/comment-form-for-proposed-rulemakings; or by electronic mail to rulescoordinator@rrc.texas.gov. The Commission will accept comments until noon (12:00 p.m.) on Monday, November 2, 2015, which is 31 days after publication in the Texas Register. Comments should refer to O&G Docket No. 20-0297968. The Commission finds that this comment period is reasonable because the proposal and an online comment form will be available on the Commission's web site more than two weeks prior to Texas Register publication of the proposal, giving interested persons additional time to review, analyze, draft, and submit comments. The Commission encourages all interested persons to submit comments no later than the deadline. The Commission cannot guarantee that comments submitted after the deadline will be considered. For further information, call Ms. Savage at (512) 463-7308. The status of Commission rulemakings in progress is available at www.rrc.texas.gov/legal/rules/proposed-rules. Statutory Authority: The Commission proposes the amendments to 3.78 pursuant to Texas Natural Resources Code, 81.051 and 81.052, which provide the Commission with jurisdiction over all persons owning or engaged in drilling or operating oil or gas wells in Texas and the authority to adopt all necessary rules for governing and regulating persons and their operations under Commission jurisdiction; Texas Natural Resources Code, 81.067 and 81.068, relating to the Oil and Gas Regulation and Cleanup Fund; Texas Natural Resource Code, 81.070, which authorizes the Commission to impose surcharges on fees; Texas Natural Resources Code, 91.101, which authorizes the Commission to prevent pollution of surface water or subsurface water from oil and gas operations; Texas Natural Resources Code, 91.011, which authorizes the Commission to adopt rules concerning the depth of well casing; Texas Natural Resources Code, 91.0115, which requires the Commission to issue groundwater protection determination letters and authorizes the Commission to charge an application fee and an expedite application fee; and Texas Water Code, 27.033, which requires a person applying for a permit under Chapter 27 to submit with the application a letter of determination from the Commission stating that drilling and using the disposal well and injecting oil and gas waste into the subsurface stratum will not endanger the freshwater strata in that area and that the formation or stratum to be used for the disposal is not freshwater sand. Cross-reference to statute: Texas Natural Resources Code, Chapters 81 and 91, and Texas Water Code, Chapter 27. Texas Natural Resources Code, 81.051, 81.052, 81.067,81.068, 81.070, 91.101, 91.011, and 91.0115, and Texas Water Code, 27.033 are affected by the proposed amendments. Issued in Austin, Texas on September 15, 3.78. Fees and Financial Security Requirements. (a) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise: (1) - (13) (No change.) (14) Groundwater protection determination letter--a letter of determination stating the total depth of surface casing required for a well in accordance with Texas Natural Resources Code, 91.011. (b) Filing fees. The following filing fees are required to be paid to the Railroad Commission. (1) - (12) (No change.) (13) Inactive well extension fee. (A) For each well identified by an operator in an application for a plugging extension based on the filing of an abeyance of plugging report on Commission Form W-3X [W3-X], the operator must pay to the Commission a non-refundable fee of $100. (B) (No change.) (14) Groundwater protection determination letters. (A) With each individual request for a groundwater protection determination letter, the applicant shall submit to the Commission a nonrefundable fee of $100. (B) With each individual application for an expedited letter of determination stating the total depth of surface casing required for a well in accordance with Texas Natural Resources Code, 91.0115(b), the applicant shall submit to the Commission a nonrefundable fee of $75, in addition to the fee required by subparagraph (A) of this paragraph. (15) - (16) (No change.) (c) - (n) (No change.) This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's authority Filed with the Office of the Secretary of State on September 15, TRD-201503778 Haley Cochran Rules Attorney, Office of General Counsel Railroad Commission of Texas For further information, please call: (512) 475-1295 TITLE 19. EDUCATION PART 1. TEXAS HIGHER EDUCATION COORDINATING BOARD CHAPTER 5. RULES APPLYING TO PUBLIC UNIVERSITIES, HEALTH-RELATED INSTITUTIONS, AND/OR SELECTED PUBLIC PROPOSED RULES October 2, 2015 40 TexReg 6817

COLLEGES OF HIGHER EDUCATION IN TEXAS SUBCHAPTER A. GENERAL PROVISIONS 19 TAC 5.10 The Texas Higher Education Coordinating Board (Coordinating Board or THECB) proposes new 5.10 pertaining to a tracking system for medical training and practice choices. This new requirement is based upon Senate Bill 295, enacted by the 84th Texas Legislature Session. The bill became effective September 1, Specifically, the proposed new section establishes a system to acquire and maintain data regarding the initial residency program choices made by graduates of medical schools in this state and the initial practice choices made by persons completing medical residency programs in this state, as required by Texas Education Code, Subchapter C, 61.0906. Dr. Julie Eklund, Interim Assistant Commissioner, THECB, has determined that for each year of the first five years the section is in effect, there will be no significant fiscal impact to the state. Dr. Eklund has determined that for the first five years the section is in effect, the public benefits anticipated as a result of administering the section will be greater understanding and transparency of the Texas physician education pipeline. There are no substantial costs to Texas higher education institutions required to comply with this section as proposed, as these institutions currently collect, but do not report, these data to the Coordinating Board. Some institutions may need to adjust their resources to allow for the submission of these data. There is no impact on local employment. Comments on the proposed new section may be submitted to Mr. Bill Abasolo, Director, Strategic Planning and Funding, THECB, 1200 East Anderson Lane, Austin, Texas 78752, bill.abasolo@thecb.state.tx.us. Comments will be accepted for 30 days following publication of the proposal in the Texas Register. The new section is proposed under Texas Education Code, 61.0906, Tracking System for Medical Training and Practice Choices, which requires the board to establish a system under which the board acquires and maintains data regarding the initial residency program choices made by graduates of medical schools in this state and the initial practice choices made by persons completing medical residency programs in this state. The proposed new section affects Texas Education Code, 61.0906. 5.10 Tracking System for Medical Training and Practice Choices. (a) The Coordinating Board shall, through an established tracking system, acquire and maintain data regarding the initial residency program choices made by graduates of medical schools in this state and the initial practice choices made by persons completing medical residency programs in this state. (b) The tracking system shall: (1) use any data reasonably available to the Coordinating Board, including data maintained by or accessible to medical schools or residency programs in this state; and (2) with respect to a person who completes a medical residency program in this state, collect relevant information for the twoyear period following completion of that program. (c) General academic and public and private health related institutions with a program in medicine or osteopathic medicine shall provide to the Coordinating Board, on a yearly basis, data regarding the initial residency program choices made by their graduates unless otherwise directed by the Coordinating Board. Filed with the Office of the Secretary of State on September 21, TRD-201503912 Bill Franz General Counsel Texas Higher Education Coordinating Board For further information, please call: (512) 427-6114 SUBCHAPTER C. APPROVAL OF NEW ACADEMIC PROGRAMS AT PUBLIC UNIVERSITIES, HEALTH-RELATED INSTITUTIONS, AND REVIEW OF EXISTING DEGREE PROGRAMS 19 TAC 5.46 The Texas Higher Education Coordinating Board (Coordinating Board) proposes amendments to 5.46 relating to Criteria for New Doctoral Programs. The intent of the amendments is to clearly delineate the criteria for approval of new doctoral programs and clarify the information and documentation that public universities and health-related institutions must submit when requesting a new doctoral program. Dr. Rex C. Peebles, Assistant Commissioner for Academic Quality and Workforce, has determined that for the first five years there will be no fiscal implications for state or local governments as a result of amending this section. Dr. Peebles has also determined that for the first five years the amendments are in effect, the public benefits anticipated as a result of administering the section will be the clarification of the criteria for approval of new doctoral programs. There are no significant economic costs anticipated to persons and institutions who are required to comply with the section as proposed. There is no impact on local employment. Comments on the proposed amendments may be submitted by mail to Rex C. Peebles, Assistant Commissioner, Texas Higher Education Coordinating Board, P.O. Box 12788, Austin, Texas 78711 or via email at AQWComments@THECB.state.tx.us comments will be accepted for 30 days following publication of the proposal in the Texas Register. The amendments are proposed under the Texas Education Code, Chapter 61, Subchapter C, 61.0512, which provides the Coordinating Board with the authority to approve new degree programs. The amendments affect the implementation of Texas Education Code, 61.0512. 5.46. Criteria for New Doctoral Programs. 40 TexReg 6818 October 2, 2015 Texas Register

Requests for new doctoral programs must provide information and documentation demonstrating that the proposed programs meet all of the following criteria: (1) Design of the Program. A doctoral-level program is designed to prepare a graduate student for a lifetime of teaching, creative activity, research, or other professional activity. The administration and the faculty of institutions initiating doctoral-level programs should exhibit an understanding of and commitment to the long tradition of excellence associated with the awarding of the traditional doctorate degrees and of the various doctoral-level professional degrees. (2) (No change.) (3) Programs at the Undergraduate and Master's Levels. Doctoral programs, in most instances, should be undergirded by quality programs in a wide number of disciplines at the undergraduate and master's levels. Quality programs in other related and supporting doctoral areas must also be available. (4) Need for the Program. There should be a demonstrated and well-documented need for doctorally prepared professionals in the discipline of the proposed program both in Texas and in the nation. It is the responsibility of the institution requesting a doctoral program to demonstrate that such a need exists, preferably through an analysis of national data showing the number of PhDs being produced annually in the area and comparing that to the numbers of professional job openings for PhDs in the discipline in question as indicated by sources such as the main professional journal(s) of the discipline. The institution must also provide data regarding the enrollments, number of graduates, and capacity to accept additional students of other similar doctoral programs in Texas, demonstrating that current production levels of graduates are insufficient to meet projected workforce needs. The institution should also provide evidence of student demand for a doctoral program in the discipline, such as potential student survey results or documentation that qualified students are not gaining admission to existing programs in Texas. (5) Faculty Resources. (A) There must be a strong core of doctoral faculty, at least four [or five], holding the doctor of philosophy degree or its equivalent from a variety of graduate schools of recognized reputation. Professors and associate professors must be mature persons who have achieved national or regional professional recognition. All core faculty must be currently engaged in productive research, and preferably have published the results of such research in the main professional journals of their discipline. They should come from a variety of academic backgrounds and have complementary areas of specialization within their field. Some should have experience directing doctoral dissertations. Collectively, the core of doctoral faculty should guarantee a high quality doctoral program with the potential to attain national prominence. The core faculty members should already be in the employ of the institution. Proposed recruitment of such faculty shall not meet this criterion. No authorized doctoral program shall be initiated until qualified faculty are active members of the department through which the program is offered. (B) In evaluating faculty resources for proposed degree programs, the Board shall consider only those degrees held by the faculty that were issued by: (i) - (ii) (No change.) (6) (No change.) (7) Critical Mass of Superior Students. Admission standards, student recruitment plans, and enrollment expectations must guarantee a critical mass of superior students. The program must not result in such a high ratio of doctoral students to faculty as to make individual guidance prohibitive. (8) - (9) (No change.) (10) Carefully Planned Program of Study. There should be a carefully planned and systematic program of study and a degree plan which is clear, comprehensive, and generally uniform but which permits sufficient flexibility to meet the legitimate professional interests and special needs of doctoral-level degree candidates. There should be a logical sequence of stages by which degree requirements shall be fulfilled. Consideration must also be given to alternative methods of determining mastery of program content, such as competency-based education, prior learning assessment, and other options for reducing student time to degree. The plan should require both specialization and breadth of education, with rules for the distribution of study to achieve both, including interdisciplinary programs if indicated. The plan should include a research dissertation or equivalent requirements to be judged by the doctoral faculty on the basis of quality rather than length. (11) External Learning Experiences. There must be a plan for providing external learning experiences for students, such as internships, clerkships, or clinical experiences, in disciplines that require them. The plan should include provisions for increasing the number of opportunities for such experiences if the number of students in existing programs equals or exceeds the available number of opportunities in Texas. (12) Support Staff. There should be an adequate number of support staff to provide sufficient services for both existing programs and any proposed increases in students and faculty that would result from the implementation of the proposed program. (13) [(11)] Physical Facilities. There should be an adequate physical plant for the program. An adequate plant would include reasonably located office space for the faculty, teaching assistants, and administrative and technical support staff; seminar rooms; laboratories, computer and electronic resources; and other appropriate facilities. (14) [(12)] Library Resources. There should be an adequate library for the proposed program. Library resources should be strong not only in the doctoral program field but also in related and supporting fields. (15) Costs and Funding. The institution should have a budgetary plan for the proposed program that clearly delineates the anticipated costs and the sources of funding. Costs for new personnel and physical resources should be adequate and reasonable, existing programs should not be negatively affected by the reallocation of funds, state funding income should be calculated correctly, and total revenues should exceed total costs by the fifth year of projected program operation. (16) [(13)] Program Evaluation Standards. Proposed programs should meet the standards of the Southern Association of Colleges and Schools, and the accrediting standards and doctoral program criteria of appropriate professional groups and organizations, such as the Council of Graduate Schools in the United States, the Modern Language Association, the American Historical Association, the Accreditation Board for Engineering and Technology or other bodies relevant to the particular discipline. Out-of-state consultants shall [may] be used by the institution and [or] the Board to assist in evaluating the quality of a proposed doctoral level program. (17) Strategic Plan. Proposed programs should build on existing strengths at the institution, should fit into the institution's strategic plan, and should align with the state strategic plan. PROPOSED RULES October 2, 2015 40 TexReg 6819

(18) [(14)] First Doctoral Program. When an institution has not previously offered doctoral level work, notification to the executive secretary of the Commission on Colleges, Southern Association of Colleges and Schools, is required at least one year in advance of program implementation. Filed with the Office of the Secretary of State on September 21, TRD-201503913 Bill Franz General Counsel Texas Higher Education Coordinating Board For further information, please call: (512) 427-6114 PART 2. TEXAS EDUCATION AGENCY CHAPTER 153. SCHOOL DISTRICT PERSONNEL SUBCHAPTER CC. COMMISSIONER'S RULES ON CREDITABLE YEARS OF SERVICE 19 TAC 153.1021, 153.1022 The Texas Education Agency proposes amendments to 153.1021 and 153.1022, concerning school district personnel. Section 153.1021 establishes requirements for recognition of creditable years of service. Section 153.1022 addresses requirements relating to the minimum salary schedule for certain professional staff. The proposed amendments would update the rules and reflect changes in statute made by Senate Bill (SB) 1309, 84th Texas Legislature, The proposed amendments would also eliminate the need for clarification letters currently posted online, ensure outdated references are removed, and align commissioner's rules with current State Board for Educator Certification (SBEC) rules. 19 TAC 153.1021, Recognition of Creditable Years of Service Effective February 1, 1998, the commissioner adopted 19 TAC 153.1021 as authorized by the Texas Education Code (TEC), 21.403, 75th Texas Legislature, 1997. The law required the commissioner to adopt rules for determining the experience for which certain professional staff are to be given credit in placement on the state minimum salary schedule. The rule provides appropriate definitions and explains required documents, necessary credentials, and the service record. The rule details the provisions for creditable years of service, including recognized employing entities for service credit. The proposed amendment to 19 TAC 153.1021 would update and clarify existing provisions, as follows. Subsection (a) would be modified in paragraph (8) to clarify the definition of current valid certificate, in paragraph (9) to update the list of regional accrediting agencies to include the reorganization of the former Northwest Association of Schools and Colleges into the Northwest Accreditation Commission and the Northwest Commission on Colleges and Universities, and in paragraph (19) to update the name of the Texas Youth Commission to the Texas Juvenile Justice Department. In addition, language would be added in paragraph (21) to give districts the ability to use digital signatures when preparing and sending service records. The change would provide guidelines defining an official service record using a digital signature. This would add another option but would not replace a hand-signed or stamped form, which is currently in rule. Subsection (d) would be modified in paragraph (5) to allow for scanned service records for paperless record-keeping. Adding this option would accommodate current technological advancements, especially for large districts. Subsection (h) would be modified in paragraph (1)(A) to add new clause (iv) to align with SBEC rule, 19 TAC 230.77, which states that ROTC instructors must have their permits reissued every year. Clause (iii) would be modified and new clause (v) would be added to align with SB 1309, 84th Texas Legislature, 2015, which establishes the ROTC classroom teaching certificate. These clauses would clarify and simplify what prior ROTC experience may be used for salary increment purposes. In addition, subsection (h) would be modified in paragraph (1)(B)(ii) to clarify that charter school positions are not required to hold a certificate to earn steps on the salary schedule and in paragraph (16)(A) to end confusion of military experience that can be used for salary increment purposes. Also in subsection (h), modifications would move text from clarification letters into rule. Language would be added as new paragraph (12)(D) to ensure credit for salary increment purposes for hospital nursing experience at university-operated hospitals earned from 2000-2001 and after and as new paragraph (18)(C) to ensure credit for salary increment purposes for eligible Peace Corps nursing experience earned from 2000-2001 and after. Subsection (k) would be modified to clarify certification requirements for substitute teachers in Texas and other states for salary increment purposes. Subsection (m) would be modified to move text from a clarification letter into rule to clearly define that an educational aide must be certified for service to count for salary increment purposes. 19 TAC 153.1022, Minimum Salary Schedule for Certain Professional Staff The commissioner is authorized to adopt a minimum monthly salary schedule for certain professionals, including classroom teachers, full-time librarians, full-time counselors, and full-time nurses. The salary schedule is based on the employee's level of experience. In accordance with the TEC, 21.402, enacted by SB 4, 76th Texas Legislature, 1999, 19 TAC 153.1022 was adopted to be effective January 2, 2000. The rule establishes definitions of qualifying staff, details eligibility criteria for placement on the salary schedule, and explains the base pay. The rule also addresses base monthly salary, the determination of "FS," and monthly minimum salary rates. The proposed amendment to 19 TAC 153.1022 would update and clarify existing provisions, as follows. Subsections (b) and (d) would be modified to delete reference to the 2011-2012 and 2012-2013 school years to make the provision apply generally to all years going forward. Subsection (d) would also be modified to replace the figure currently adopted in rule for the minimum monthly salary rates with new Figure: 19 TAC 153.1022(d)(1) for the 2014-2015 school 40 TexReg 6820 October 2, 2015 Texas Register

year and new Figure: 19 TAC 153.1022(d)(2) for the 2015-2016 and 2016-2017 school years. The proposed amendment would have no procedural or reporting implications. The proposed amendment would have no locally maintained paperwork requirements. FISCAL NOTE. Ryan Franklin, associate commissioner for educator leadership and quality, has determined that for the first five-year period the amendments are in effect there will be no additional fiscal implications for state or local government as a result of enforcing or administering the amendments. PUBLIC BENEFIT/COST NOTE. Mr. Franklin has determined that for each year of the first five years the amendments are in effect the public benefit anticipated as a result of enforcing the amendments will be to provide clarification, update requirements to align with recent changes to statute and SBEC rules, and accommodate the use of technology to make the transfer of service records more efficient. There is no anticipated economic cost to persons who are required to comply with the proposed amendments. ECONOMIC IMPACT STATEMENT AND REGULATORY FLEX- IBILITY ANALYSIS FOR SMALL AND MICROBUSINESSES. There is no direct adverse economic impact for small businesses and microbusinesses; therefore, no regulatory flexibility analysis, specified in Texas Government Code, 2006.002, is required. REQUEST FOR PUBLIC COMMENT. The public comment period on the proposal begins October 2, 2015, and ends November 2, Comments on the proposal may be submitted to Cristina De La Fuente-Valadez, Rulemaking, Texas Education Agency, 1701 North Congress Avenue, Austin, Texas 78701, (512) 475-1497. Comments may also be submitted electronically to rules@tea.texas.gov or faxed to (512) 463-5337. A request for a public hearing on the proposal submitted under the Administrative Procedure Act must be received by the commissioner of education not more than 14 calendar days after notice of the proposal has been published in the Texas Register on October 2, STATUTORY AUTHORITY. The amendments are proposed under the Texas Education Code (TEC), 21.402, which requires school districts to pay certain personnel at a minimum monthly salary based on experience and other factors as determined by commissioner rule. TEC, 21.403, requires the commissioner to adopt rules determining the experience for which personnel subject to the minimum salary schedule shall be given credit. SB 1309 added TEC, 21.0487, requiring the SBEC to establish a Junior Reserve Officer Training Corps (JROTC) teaching certificate. The statute prescribes certain standards for the JROTC certification. TEC, 12.120(a-1), allows for charter schools to hire uncertified educators. Human Resources Code, 201.001, reflects the updated name for the Texas Juvenile Justice Department. CROSS REFERENCE TO STATUTE. The amendments implement the TEC, 21.402; 21.403; 21.0487, as added by SB 1309, 84th Texas Legislature, 2015; and 12.120(a-1); and Texas Human Resources Code, 201.001. 153.1021. Recognition of Creditable Years of Service. (a) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise: (1) Accredited institution--a public or private elementary, secondary, or post-secondary institution whose education program has been evaluated and deemed accredited by a state department of education or recognized regional accrediting agency. (2) Charter school--a charter school that has been authorized to operate under the Texas Education Code (TEC), Chapter 12, Subchapter D or E. (3) Assignment--Refers to the actual duties a person has with a school district or other educational entity. (4) Authorized leave--leave granted under the state's former minimum sick leave program, leave granted under the state's current minimum personal leave program[,] (which includes physical assault leave), or any leave granted under a local leave policy for which the employee is paid as if on regular duty. (5) Certificate--A document issued by the State Board for Educator Certification (SBEC) authorizing the holder to teach in the public elementary and secondary schools of Texas. (6) Certified--Status of a person who holds a valid Texas teaching certificate. (7) Contractual year--the employment period between July 1 and the following June 30. (8) Current valid certificate--a certificate that is or was valid at a given time, including the stipulation that after June 30, 1986, a Texas certificate is valid only if the certified person has successfully passed any certification requirement that was mandated by either the State Board of Education or the SBEC. (9) Faculty status--employment by a college or university as a member of the professional administrative or instructional staff, not as a graduate assistant, an assistant instructor, or an instructor on a fellowship. (10) Full-time employment--employment for 100% of an institution's normal work schedule. (11) Full-time equivalency--the amount of time required of a staff member to perform a less than full-time assignment divided by the amount of time required in performing a corresponding full-time assignment. Full-time equivalency of assignment usually is expressed as a decimal fraction to the nearest tenth. (12) Minimum salary--the minimum salary a classroom teacher, full-time librarian, full-time counselor, or full-time school nurse must be paid as prescribed in TEC, Chapter 21. (13) Part-time employment--employment for less than 100% of an institution's normal work schedule. (14) Professional personnel--teachers, full-time librarians, full-time counselors, full-time school nurses, other employees who are required to hold a certificate issued under TEC, Chapter 21, Subchapter B, and any other personnel reported by a school district to the Public Education Information Management System with a "professional" roleid. (15) Regional accrediting agency--the recognized regional accrediting agencies are: (A) Southern Association of Colleges and Schools; (B) Middle States Association of Colleges and Schools; (C) North Central Association of Colleges and Schools; (D) New England Association of Schools and Colleges; (E) Western Association of Schools and Colleges; PROPOSED RULES October 2, 2015 40 TexReg 6821

Northwest Commission on Colleges and Universities; (F) (G) Northwest Accreditation Commission; [(F) Northwest Association of Schools and Colleges;] (H) [(G)] Commission on International and Trans-regional Accreditation; (I) [(H)] International Baccalaureate Organization; (J) [(I)] European Council of International Schools/Council of International Schools; and [(J)] National Council for Private School Accreditation. (K) (16) Salary increments--increases in salary granted for teaching or work experience. (17) School nurse--an educator employed to provide fulltime nursing and health care services and who meets all the requirements to practice as a registered nurse (RN) pursuant to the Nursing Practice Act and the rules and regulations relating to professional nurse education, licensure, and practice, and who has been issued a license to practice professional nursing in Texas. (18) Service--A term of employment measured in school years in an entity in which the employment is recognized for salary increment purposes. (19) State school--a school that is funded by legislative action in the appropriations act. These schools include the Texas School for the Blind, the Texas School for the Deaf, and schools under the jurisdiction of the Texas Department of State Health Services (formerly the Texas Department of Mental Health and Mental Retardation) and the Juvenile Justice Department (formerly known as the Texas Youth Commission). (20) Substitute teacher--a certified teacher who works on call, does not have a full-time assignment, and provides instruction. (21) Teacher service record--the official document used to record years of service and days used and accumulated under the state's former minimum sick leave program or the state's current personal leave program. A service record with a digital signature is only valid for the intended recipient as recorded on the service record. A digital version that includes information from previous employing districts is acceptable if the most recent school district is the designated recipient of the information from the previous districts. The digital service record will not be official if the recipient is the educator; however, upon request the district will provide a copy to the educator in accordance with the TEC, 21.4031(b). (b) Required documentation. The following records on professional personnel must be readily available for review. (1) credentials (certificate or license); (2) service record(s) and any required attachments; (3) contract; (4) teaching schedule or other assignment record; and (5) absence from duty reports. (c) Credentials for professional personnel. The credentials for professional personnel are as follows. (1) A current valid Texas certificate, a special assignment permit, a nonrenewable permit, a non-certified instructor's permit, an emergency teaching permit, or the appropriate licensure from the State of Texas. (2) For special education related service teachers, the credential must be appropriate licensure from the State of Texas. (3) For those special education related service personnel who do not require Texas certification or licensure, proper credentials as described in 89.1131 of this title (relating to Qualifications of Special Education, Related Service, and Paraprofessional Personnel) are required. (d) Teacher service record. The basic document in support of the number of years of professional service claimed for salary increment purposes and both the state's sick and personal leave program data for all personnel is the teacher service record (form FIN-115) or a similar form containing the same information. It is the responsibility of the issuing school district or charter school to ensure that service records are true and correct and that all service recorded on the service record was actually performed. (1) The service record must be validated by a person designated by the school district or charter school to sign service records. (2) Supporting documents are required for service in outof-state private schools, foreign public and private institutions, the military, and colleges and universities. The type of supporting documentation for each particular entity is prescribed by subsection (h) of this section. (3) If a person is employed by more than one school district or charter school during the same school year, a service record from each employing district or charter school is required. (4) For personnel employed in a year-round school system, the actual dates of employment during that school's calendar must be indicated on the service record. The dates may not necessarily conform to the contractual year as defined by subsection (a) of this section. (5) The service record shall be kept on file at the school district or charter school. When employment with the district or charter school is terminated, the original service record, signed by the employee shall be given to the employee upon request or sent to the next employing school district or charter school. The local school district or charter school must maintain a legible copy for audit purposes. A scanned version of the original service record may be considered official if sent directly from one employing district to another employing district. (6) Cooperative personnel employed by a fiscal agent/manager and itinerant personnel of a cooperative shall be considered to be employees of the fiscal agent/manager and the service record shall be the fiscal agent/manager's responsibility. Personnel employed by a member of a cooperative and assigned to the member are employees of the member and the service record shall be the member's responsibility. (7) Work experience claimed by career and technology education personnel for salary increment purposes as prescribed by subsection (i) of this section must be recorded on a service record. (8) State sick leave balances, days earned, and days used by personnel under the former state's minimum sick leave program and the state's current personal leave program must be recorded on the service record or another similar form containing the same information. State sick leave and state personal leave accumulated in Texas public elementary and secondary schools are transferable among these schools. State personal leave accrued by an employee of a Texas regional education service center, not to exceed five days per each year of employment, is transferable to a Texas public elementary and secondary school. State sick leave and state personal leave accrued by 40 TexReg 6822 October 2, 2015 Texas Register

an employee of Harris County Department of Education and Dallas County Schools are transferable to Texas public elementary and secondary schools in accordance with the TEC, 22.003(a). Local leave accrued under the policy of any entity recognized for creditable service under subsection (g) of this section may be transferred to a Texas public elementary or secondary school at the discretion of the employing school district. The service record shall separately state the number of accumulated state days for which the employee is paid, if any, upon separation from the employing district. (9) State days used to purchase additional years of service from the Teacher Retirement System of Texas (TRS) for retirement purposes must be deducted from the balance reflected on the service record. (10) The issuing school district or charter school must submit the service record to the Texas Education Agency upon request. (e) General provisions for years of creditable service. All service claimed for salary increment purposes must meet the requirements in subsections (f)-(h) of this section. The service record and any other required supporting documents must meet the requirements for such records and documentation in this section. All service shall be based on the contractual year (July 1-June 30). No more than one year of experience may be acquired in any one contractual year. (f) Minimum requirements. The table in this subsection indicates the minimum number of days required to earn and receive credit for a year of experience. Figure: 19 TAC 153.1021(f) (No change.) (1) For service performed through the 1989-1990 school year, minimum days at less than 100% or at full-time equivalency are applicable only to service in Texas public schools, Texas education service centers, and, beginning in 1978-1979, Texas public colleges and universities. (2) Beginning with service performed during the 1990-1991 school year or any year thereafter, employment at less than 100% of the day is recognized in all entities where full-time employment is recognized, provided that documentation is presented to the employing district which verifies that the employment was for not less than three and one-half hours each day. (3) The 90 days required at 100% of the day for years prior to 1972-1973 may be equivalent to four and one-half months, a full semester, or three six-weeks. Where the school year was less than 180 days for any year prior to 1972-1973, a minimum of 175 days at 50-99% of the day will be accepted, provided that the 175 days constituted two full semesters or six six-weeks. (4) For experience from the 1978-1979 through the 1987-1988 school years, full-time equivalent days equal the total number of days employed at 100% of the day plus days employed at 50-99% of the day divided by two. (5) Beginning with the 1988-1989 school year, full-time equivalent days equal the total number of days employed multiplied by the percent of day actually worked. (6) Beginning with the 1998-1999 school year, the 90 days required at 100% of the day may be equivalent to four and one-half months or a full semester. The 180 days required at 50-99% of the day may be equivalent to 90 full-time equivalent days (percent of day employed multiplied by number of days employed). (7) Extended day migrant program employment shall be calculated in accordance with this section and the resulting equivalent must meet the same minimum requirements for professionals for the year in question. (A) For service prior to the 1970-1971 school year, the days employed in the migrant program shall be multiplied by a factor of 1.37. (B) For service during the 1970-1971 through the 1975-1976 school years, the days employed in the migrant program shall be multiplied by a factor of 1.31. (g) Entities recognized for years of service. Service in any of the entities listed in this subsection shall be recognized for professional personnel. The minimum employment requirements in subsection (f) of this section must be met. Requirements concerning service in each type of entity in subsection (h) of this section must also be met. Professional service in the following entities is creditable: (1) Texas public elementary and secondary schools, including charter schools; (2) State regional education service centers; (3) State departments of education; (4) Texas Department of Corrections--Windham Schools; (5) Public elementary and secondary schools in all other states in the United States or within the boundaries of any of its territorial possessions; (6) Overseas schools operated by the U.S. Government; (7) Texas public or private colleges or universities; (8) Texas private elementary and secondary schools; (9) Texas non-public special education contract schools; (10) Texas Department of State Health Services (formerly the Texas Department of Mental Health and Mental Retardation)--state hospitals and state schools; (11) Texas veterans' vocational schools; (12) Public or private colleges or universities and private elementary and secondary schools in all other states in the United States or within the boundaries of any of its territorial possessions; (13) Foreign public or private colleges or universities, or elementary and secondary schools; (14) U.S. Department of Interior--Bureau of Indian Affairs; (15) U.S. service academies; (16) U.S. military service; (17) Job Corps; and (18) Peace Corps (in a professional capacity only). (h) Requirements. Requirements for entities recognized for professional personnel are as follows: (1) Texas public elementary and secondary schools, including charter schools. (A) Requirements specific to Texas public elementary and secondary schools. (i) All professional personnel must be certified by the State of Texas, must hold the proper state or national licensure as required by the position held, or must have the educational requirements for the job assigned. Regardless of the funding source, classroom teachers, full-time librarians, full-time counselors, and full-time school nurses must be paid at least the minimum salary specified in the Texas State Public Education Compensation Plan. PROPOSED RULES October 2, 2015 40 TexReg 6823

(ii) Professional personnel placed on developmental leaves of absence must be paid at least one-half of their state minimum salary by the school district to receive service credit for increment purposes. (iii) Instructors in Reserve Officer Training Corps (ROTC) programs conducted by local school districts must be certified or hold an emergency teaching permit [and must be paid at least the state minimum salary to receive service credit for increment purposes]. An emergency teaching permit need not be renewed as long as the person continues in the ROTC assignment. (iv) Beginning with the 2014-2015 school year, an emergency teaching permit must be reissued annually in accordance with 230.77 of this title (relating to Specific Requirements for Initial Emergency Permits). (v) Beginning July 1, 2015, ROTC instructors who hold the ROTC standard Texas classroom teaching certificate must be paid according to the minimum salary schedule. Prior experience serving as an ROTC instructor on an emergency permit shall be recognized for salary increment purposes provided the minimum employment requirements specified in subsection (f) of this section are met for ROTC instructors who obtain a standard Texas classroom teaching certificate. (B) Requirements specific to charter schools. (i) Employment must have been in a professional capacity as defined by subsection (a) of this section. (ii) For salary increment purposes, educators are not required to be certified unless they are serving [Texas charter schools are not required to hire certified teachers other than those] in special education or [and] bilingual education[,] or are required to be certified [as stated] in the charter application. (2) State regional education service centers. (A) Personnel employed in cooperatives for which the education service center is acting as fiscal agency must meet the same requirements as personnel employed in Texas public elementary and secondary schools. (B) All other personnel must meet the same requirements as personnel employed in state departments of education. (3) State departments of education. Employment must have been in a professional capacity. For Texas department of education employment, professional positions are defined as personnel employed in positions starting in state pay grade classification B4/A12 and above. (4) Texas Department of Corrections--Windham schools. Requirements in this subsection shall apply. (5) Public elementary and secondary schools in all other states of the United States or within the boundaries of any of its territorial possessions. Employment prior to 1990-1991 must have been on a full-time basis. (6) Overseas schools operated by the U.S. government. Schools operated by the United States Government for military dependents and dependents of personnel assigned to an embassy, consulate, etc., are treated as public schools in other states of the U.S. and policies pertaining to public schools in other states apply. (7) Texas public or private colleges or universities. (A) For private colleges and universities, accreditation by the Southern Association of Colleges and Schools is required. (B) Officer Training Corps programs conducted by accredited colleges or universities must have been employed full-time on a faculty status level. Beginning in 1998-1999, service as an instructor in an agricultural extension service operated by an accredited college or university may be recognized for salary increment purposes as long as the person held a valid Texas teaching certificate at the time the service was rendered. (C) All college or university experience must be recorded on the teacher service record. A supporting letter or form must be attached to the teacher service record verifying that either the full-time or part-time employment was at faculty status or its equivalent and that the schedule of work and the pay constituted that of other similar faculty employees. It is the responsibility of the employing school district to secure verification of college or university experience. (8) Texas private elementary and secondary schools. (A) For experience prior to the 1986-1987 school year, accreditation by the Texas Education Agency or the Southern Association of Colleges and Schools is required. (B) For experience in the 1986-1987, 1987-1988, and 1988-1989 school years, service shall be acceptable if the school was accredited by the Texas Education Agency, or a recognized regional accrediting agency. (C) For experience in the 1989-1990 school year and thereafter, service shall be acceptable if the school was accredited by the Texas Private School Accreditation Commission. (D) During the 1986-1987, 1987-1988, and 1988-1989 school years, private schools accredited by the Texas Education Agency, a recognized regional accrediting agency, or an association recognized by the commissioner of education will be listed in the Texas School Directory. (E) Beginning with the 1989-1990 school year and thereafter, private schools accredited by the Texas Private School Accreditation Commission will be listed in the Texas School Directory. (F) Beginning with the 2004-2005 school year and thereafter, private schools accredited by the Texas Private School Accreditation Commission will be listed on the Texas Education Agency website. (9) Non-public special education contract schools. (A) Approval from the Texas Education Agency to provide special education services during the year service was rendered is required. A list of approved schools is maintained by the Texas Education Agency and posted on the Texas Education Agency website. (B) The person must have been certified in an area of special education. (10) Texas Department of State Health Services (formerly the Texas Department of Mental Health and Mental Retardation) state hospitals and state schools. (A) The assignment must have been in an educational program operated in conjunction with a public school program or in a non-educational professional capacity. (B) Persons employed in an educational program must have held a valid Texas teaching certificate and must have been paid at least the state minimum salary of a teacher in a Texas public school. (11) Texas veteran's vocational school. 40 TexReg 6824 October 2, 2015 Texas Register

(A) coordinator. The assignment must have been as an instructor or (B) Service during the period of July 1, 1946, through June 30, 1955, must have been at a school under the jurisdiction of the Texas Education Agency (this service can be verified by the agency). (C) Service after June 30, 1955, must have been at a veteran's vocational school operated by a Texas county board of school trustees under the jurisdiction of the Veterans Administration. (12) Public or private colleges and universities, and private elementary and secondary schools in all other states in the United States or within the boundaries of any of its territorial possessions. (A) Employment must have been, and in the case of colleges and universities, must be verified in the same manner as for Texas colleges or universities. (B) Accreditation by a recognized state or regional accrediting agency listed in subsection (a)(15) of this section is required. In states or territories that have no provisions for accrediting, licensing, or approving private elementary or secondary schools, service shall be acceptable provided the person held, while employed, a valid teaching certificate from the state in which the school is located or a valid Texas teaching certificate. (C) It is the responsibility of the employing school district or charter school to have evidence on file of the accreditation status of private schools in other states. (D) Hospital nursing experience shall be acceptable provided the person held a registered nurse position with a recognized accredited university-operated hospital listed in this subsection. All eligible prior-year service in this area can be claimed for placement beginning on the 2000-2001 minimum salary schedule. (13) Foreign public or private elementary and secondary schools, colleges, and universities. (A) Employment in colleges or universities must be verified in the same manner as for Texas colleges or universities. (B) For foreign public schools, colleges, and universities, accreditation by a recognized agency of the foreign country or by a recognized accrediting agency in the United States is required. (C) For foreign private schools, colleges, and universities, accreditation must be by a recognized regional accrediting agency listed in subsection (a)(15) of this section. (D) The accreditation status must be verified in the same manner as for public or private schools in the United States. (14) United States Department of the Interior--Bureau of Indian Affairs. Service must have been full-time. (15) United States service academies. (A) Employment must have been at a faculty status level and must be verified in the same manner as other college or university service. Air Force Academy, Colorado Springs, Colorado; (ii) Coast Guard Academy, New London, Connecticut; (B) The service academies are as follows: (i) (iii) Military Academy, West Point, New York; (iv) Naval Academy, Annapolis, Maryland; and York. (v) Merchant Marine Academy, Kings Point, New (16) United States military service. Service with the military forces of the United States of America may be counted for salary increment purposes if the following conditions are met.[:] (A) The person was a professional employee of any entity recognized for creditable service for salary increment purposes within twelve months prior to [of] entry into active duty. (B) Form DD-214 or other official discharge papers must be filed with the teacher service record showing: (i) that military service was in the capacity of an enlisted man or woman or commissioned officer; (ii) that release or separation from active duty was under honorable conditions; and (iii) dates of entry and release from active duty. (C) The person claiming military service was on active duty during the periods September 1, 1940, through August 31, 1947, or September 1, 1950, through August 31, 1954, or for other periods if: (i) the military service was a result of involuntary induction into active duty; or (ii) the military service was a result of voluntary entry into active duty for the first time for the individual, and such initial period of voluntary military service claimed as years of service for teacher salary increments does not exceed four years. (D) Beginning with the 1983-1984 school year, for purposes of determining the total years of military experience creditable for increment purposes, a year shall be considered to begin on July 1 and end June 30. During this period, four and one-half months of service must be acquired for an individual to be entitled to one year of experience. Only one year of experience may be earned during any 12-month period. Prior to the 1983-1984 school year, credit for military service was calculated based on the 12-month period from September 1-August 31. Credit granted on that basis shall continue to be effective. (E) The requirement in subparagraph (A) of this paragraph must be met before any credit is given. (17) Job Corps. The person must have held a valid teaching certificate or appropriate license that would qualify for service credit during the period of employment. (18) Peace Corps. (A) Employment must have been with a school system (Grades K-12) in a foreign country. (B) The person must have held a valid teaching certificate or appropriate license that would qualify for service credit from any state in the United States during the period of employment. (C) Peace Corps nursing experience shall be acceptable and recognized in the same manner as teaching experience in the Peace Corps, provided the nursing service in the Peace Corps was as a registered nurse. Requirements listed in this subsection and subsection (a)(17) of this section must also be met. All eligible prior-year service in this area can be claimed for placement beginning on the 2000-2001 minimum salary schedule. (i) Credit for career and technology teachers. In accordance with TEC, 21.403, effective with the 1982-1983 school year, certified career and technology education teachers employed for at least 50% of the time in an approved career and technology position may count up PROPOSED RULES October 2, 2015 40 TexReg 6825

to two years of work experience for salary increment purposes if the work experience was required for career and technology certification. (1) For purposes of this section, an emergency teaching permit shall be the equivalent of a teaching certificate. (2) Once credit for work experience has been granted, the credit shall be continued regardless of the position held. For personnel granted credit under this section whose employment is split between career and technology and non-career and technology positions, the years granted shall apply to both the career and technology and the non-career and technology positions. (j) Adult basic education program credit. A person teaching adult basic education is eligible for creditable service if the program was operated by a public school and the person held a valid teaching certificate. (k) Substitute teachers. Beginning with the 1998-1999 school year, a certified substitute teacher, as defined in subsection (a) of this section, employed in an entity recognized for years of service as prescribed by subsection (g) of this section is eligible for creditable service, provided that the educator held a valid Texas teaching certificate or a valid teaching certificate from the state where the school is located at the time the service was earned. All eligible prior-year service in this area can be claimed for placement on the 1998-1999 minimum salary schedule. This also applies to out-of-state substitute teaching experience. It does not apply to out-of-country substitute experience. (l) Salary schedule. The commissioner of education shall publish annually the state minimum salary schedule. (m) Certified teacher [Teacher] aides. Beginning with the 2004-2005 contractual year, a certified teacher aide who subsequently attains initial classroom teacher certification may count up to two years of full-time equivalency of direct student instruction for salary increment purposes. Such experience must be verified on the teacher service record form (FIN-115) or a similar form containing the same information. A teacher aide who received a teaching certificate or was placed under a permit prior to the 2004-2005 contractual year will not qualify for the additional years of service on the minimum salary schedule under this section. 153.1022. Minimum Salary Schedule for Certain Professional Staff. (a) Definitions and eligibility. The following definitions and eligibility criteria apply to the minimum salary schedule in accordance with Texas Education Code (TEC), Chapter 21. (1) The staff positions employed by public school districts that are entitled to the minimum salary schedule under TEC, 21.402, are classroom teachers, full-time librarians, full-time counselors, and full-time nurses. (A) A classroom teacher is an educator who teaches an average of at least four hours per day in an academic or career and technology instructional setting pursuant to TEC, 5.001, focusing on the delivery of the Texas essential knowledge and skills and holds the relevant certificate issued by the State Board for Educator Certification (SBEC) under the provisions of TEC, Chapter 21, Subchapter B. Although non-instructional duties do not qualify as teaching, necessary functions related to the educator's instructional assignment such as instructional planning and transition between instructional periods should be applied to creditable classroom time. (B) A school librarian is an educator who provides fulltime library services and holds the relevant certificate issued by the SBEC under the provisions of TEC, Chapter 21, Subchapter B. (C) A school counselor is an educator who provides full-time counseling and guidance services under the provisions of TEC, Chapter 33, Subchapter A, and holds the relevant certificate issued by the SBEC pursuant to the provisions of TEC, Chapter 21, Subchapter B. (D) A school nurse is an educator employed to provide full-time nursing and health care services and who meets all the requirements to practice as a registered nurse (RN) pursuant to the Nursing Practice Act and the rules and regulations relating to professional nurse education, licensure, and practice and has been issued a license to practice professional nursing in Texas. (2) An eligible educator who is employed by more than one district in a shared service arrangement or by a single district in more than one capacity among any of the eligible positions qualifies for the salary increase as long as the combined functions constitute full-time employment. (3) Full-time means contracted employment for at least ten months (187 days) for 100% of the school day in accordance with definitions of school day in TEC, 25.082, employment contract in TEC, 21.002, and school year in TEC, 25.081. (4) A local supplement is any amount of pay above the state minimum salary schedule for duties that are part of a teacher's classroom instructional assignment. (5) Current placement on the salary schedule means a placement based on years of service recognized for salary increment purposes up to the current year. (6) Salary schedule means a system of providing routine salary increases based upon an employee's total teaching experience and/or an employee's longevity in a school district. (b) Base monthly salary [for the 2011-2012 and 2012-2013 school years]. The base monthly salary is the monthly salary that is at least equal to the monthly salary as determined by TEC, 21.402(c-1). (1) Eligible classroom teachers employed by school districts are entitled to the minimum salary schedule that is at least equal to the monthly salary as determined by TEC, 21.402(c-1). (2) Eligible full-time counselors, full-time nurses, and fulltime librarians employed by school districts are entitled to the minimum salary schedule that is at least equal to the monthly salary as determined by TEC, 21.402(c-1). (c) Determination of "FS." "FS" is the amount, as determined by the commissioner under TEC, 21.402(b), of the basic allotment as provided by TEC, 42.101(a) or (b), for a school district with a maintenance and operations tax rate at least equal to the state maximum compressed tax rate, as defined by TEC, 42.101(a). (d) Monthly minimum salary rates. The minimum monthly salary rates [applicable for the 2011-2012 and 2012-2013 school years], in accordance with this section and TEC, 21.402, shall be as set forth in [the table in] this subsection. If the minimum monthly salary determined under TEC, 21.402(a), for a particular level of experience is less than the minimum monthly salary for that level of experience in the preceding year, the minimum monthly salary is the minimum monthly salary for the preceding year. [Figure: 19 TAC 153.1022(d)] (1) The minimum monthly salary rates applicable for the 2014-2015 school year, in accordance with this section and TEC, 21.402, shall be as set forth in the table in this subsection. Figure: 19 TAC 153.1022(d)(1) (2) The minimum monthly salary rates applicable for the 2015-2016 and 2016-2017 school years, in accordance with this section and TEC, 21.402, shall be as set forth in the table in this subsection. 40 TexReg 6826 October 2, 2015 Texas Register

Figure: 19 TAC 153.1022(d)(2) Filed with the Office of the Secretary of State on September 21, TRD-201503922 Cristina De La Fuente-Valadez Director, Rulemaking Texas Education Agency For further information, please call: (512) 475-1497 TITLE 22. EXAMINING BOARDS PART 21. TEXAS STATE BOARD OF EXAMINERS OF PSYCHOLOGISTS CHAPTER 461. GENERAL RULINGS 22 TAC 461.9 (Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the Texas State Board of Examiners of Psychologists or in the Texas Register office, James Earl Rudder Building, 1019 Brazos Street, Austin, Texas.) The Texas State Board of Examiners of Psychologists proposes the repeal of 461.9, Subdoctoral Licensure. The proposed repeal is necessary to reflect the consolidation of the substance of this rule with the newly proposed Board rule 463.8. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed repeal will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no effect on small businesses or local economies. Comments on the proposed repeal may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Suite 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The repeal is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 461.9. Subdoctoral Licensure. Filed with the Office of the Secretary of State on September 16, TRD-201503820 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 CHAPTER 463. APPLICATIONS AND EXAMINATIONS 22 TAC 463.1 The Texas State Board of Examiners of Psychologists proposed amendment to 463.1, Types of Licensure. The proposed amendment will prevent duplicate provisions, and assist with the consolidation and clarification of rules related to supervision under Board rule 465.2. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed amendment will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no effect on small businesses or local economies. Comments on the proposed amendment may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The amendment is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 463.1. Types of Licensure. The Board accepts applications for four types of licenses to practice psychology in the state of Texas: (1) Licensed Psychological Associate. This is a [subdoctoral] license for qualified individuals to practice psychology under the supervision of a licensed psychologist. Requirements for the psychological associate license are found in 463.8 of this title (relating to Licensure as a Psychological Associate) and 463.14 of this title (relating to Written Examinations). (2) Licensed Specialist in School Psychology. This license is required by law for the practice of school psychology in the public schools of Texas. Requirements for the specialist in school psychol- PROPOSED RULES October 2, 2015 40 TexReg 6827

ogy license are found in 463.9 of this title (relating to Licensure as a Specialist in School Psychology) and 463.14 of this title. (3) Provisionally Licensed Psychologist. This is a doctoral level license to practice psychology under the supervision of a licensed psychologist. This license is a prerequisite for licensure as a psychologist. Requirements for provisionally licensed psychologist are found in 463.10 of this title (relating to Provisionally Licensed Psychologist) and 463.14 of this title. [An individual who is provisionally licensed in accordance with 463.10(c) of this title and who is currently licensed to independently practice psychology in another state may practice without supervision after submission of an application for licensure as a psychologist to the Board. Upon notification from the Board that such an applicant has not met the qualifications for licensure as a psychologist, the provisionally licensed psychologist must obtain supervision within 30 days in order to continue to practice.] (4) Licensed Psychologist. This is a doctoral level license for the independent practice of psychology. It is obtained by two means: (A) Obtaining provisional licensure as a psychologist, completing the required two years of supervised experience and taking and passing the required oral exam. Requirements for licensure as a psychologist are found in 463.11 of this title (relating to Licensed Psychologist), 463.14 of this title, and 463.15 of this title (relating to Oral Examination [Exam]). (B) Applying from a jurisdiction which holds a reciprocity agreement with Texas, meeting the Board's requirements for licensure by reciprocity, and passing the Board's Jurisprudence Exam. Criteria for reciprocity jurisdictions are listed in 463.29 of this title (relating to Reciprocity Requirements). Requirements for licensure as a psychologist by means of reciprocity are found in 463.12 of this title (relating to Licensed Psychologist by Reciprocity) and 463.14 of this title. Filed with the Office of the Secretary of State on September 16, TRD-201503830 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 463.6 The Texas State Board of Examiners of Psychologists proposes amendment to 463.6, Regionally Accredited Institutions. The proposed amendment would reflect the change in name for one of the accrediting bodies. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed amendment will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no effect on small businesses or local economies. Comments on the proposed amendment may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The amendment is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 463.6. Regionally Accredited Institutions. A regionally accredited educational institution stated in 501.255(a)(1)(A), 501.259, 501.004 and 501.260 of the Act is defined as an educational institution which satisfies the standards of the accrediting association in one of the following six regions throughout the United States: (1) Southern Association of Colleges and Schools (2) Western Association of Schools and Colleges (3) Northwest Commission on Colleges and Universities [Northwest Association of Schools and Colleges] (4) North Central Association of Colleges and Schools (5) New England Association of Schools and Colleges (6) Middle States Association of Colleges and Schools Filed with the Office of the Secretary of State on September 16, TRD-201503831 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 463.8 (Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the Texas State Board of Examiners of Psychologists or in the Texas Register office, James Earl Rudder Building, 1019 Brazos Street, Austin, Texas.) The Texas State Board of Examiners of Psychologists proposes the repeal of 463.8, Licensed Psychological Associate. The proposed repeal is necessary due to the extensive changes proposed for this rule. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed repeal will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. 40 TexReg 6828 October 2, 2015 Texas Register

Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no effect on small businesses or local economies. Comments on the proposed repeal may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Suite 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The repeal is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 463.8. Licensed Psychological Associate. Filed with the Office of the Secretary of State on September 16, TRD-201503821 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 463.8 The Texas State Board of Examiners of Psychologists proposes new rule 463.8, relating to Licensed Psychological Associate. The proposed new rule is intended to replace the current version of the rule and reflects a collaborative effort by the Board and its stakeholders to consolidate the rules governing supervision into a more intuitive format. The proposed new rule sets forth the same requirements for licensure as the current rule, but will eventually require the supervised experience necessary for licensure to be obtained as part of an organized course of study. The proposed new rule will also expand licensure opportunities by allowing applicants who possess a doctoral degree that is primarily psychological in nature, but who do not also have a master's degree, the ability to apply for licensure as a psychological associate. Lastly, the proposed new rule incorporates the designation of the title for an individual licensed under this rule, currently found in Board rule 461.9. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed new rule will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic cost to persons required to comply with this rule. There will be no effect on small businesses or local economies. Comments on the proposed new rule may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The new rule is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 463.8. Licensed Psychological Associate. (a) Application Requirements. (1) A completed application for licensure as a psychological associate includes, in addition to the requirements set forth in 463.5 of this title (relating to Application File Requirements), documentation of 450 hours of practicum, internship, or experience in psychology, in not more than two placements, supervised by a licensed psychologist. (2) A completed application for licensure as a psychological associate includes, in addition to the requirements set forth in 463.5 of this title, documentation of 450 hours of practicum, internship, or experience in psychology, in not more than two placements, supervised by a licensed psychologist. The 450 hours of practicum, internship, or experience in psychology must have been obtained as part of a course of study from a regionally accredited institution of higher education. This paragraph shall take effect, supersede, and take the place of paragraph (1) of this subsection on September 1, 2017. (3) Applicants may not utilize any supervised experience obtained from a psychologist who is related within the second degree of affinity or consanguinity to satisfy the requirements of this rule. (b) Qualifications. A candidate for licensure as a psychological associate shall meet the qualifications and requirements of candidates at the doctoral level as stated in 501.255(a)(2) - (9) of the Act. (c) Educational Requirements. (1) The Board requires a doctoral degree or master's degree which is primarily psychological in nature. A degree utilized to meet the requirements of this rule must consist of at least 42 semester credit hours for licensure. Of these 42 hours, at least 27 graduate level semester credit hours (exclusive of practicum) must have been in psychology. Six semester credit hours of thesis credit in a department of psychology may be counted toward these 27 semester credit hours. (2) Applicants who have a master's degree in psychology conferred from a psychology program in a regionally accredited educational institution, but who have not satisfied the requirements of paragraph (1) of this subsection, may complete a maximum of 12 additional semester hours of coursework to satisfy the requirements for licensure. The additional coursework must be obtained from a formal masters or doctoral degree program in psychology at a regionally accredited college or university, and must be reflected on an official transcript provided to the Board. Additionally, applicants must submit a letter from the official in charge of the psychology program offering the additional coursework stating that the applicant's graduate degree in psychology, with this additional prescribed coursework, is equivalent to a 42 hour master's degree in psychology from that program. PROPOSED RULES October 2, 2015 40 TexReg 6829

(d) Coursework. The application for licensure as a psychological associate shall include course titles and the names of instructors. If questions exist as to the content of coursework, the Board may require the applicant to furnish a catalogue of the university or college where the courses were taken and the addresses of instructors. (e) The proper title for a person licensed under this rule shall be "psychological associate." Filed with the Office of the Secretary of State on September 16, TRD-201503832 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 463.9 (Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the Texas State Board of Examiners of Psychologists or in the Texas Register office, James Earl Rudder Building, 1019 Brazos Street, Austin, Texas.) The Texas State Board of Examiners of Psychologists proposes the repeal of 463.9, Licensed Specialist in School Psychology. The proposed repeal is necessary due to the extensive changes proposed for this rule. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed repeal will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no effect on small businesses or local economies. Comments on the proposed repeal may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Suite 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The repeal is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 463.9. Licensed Specialist in School Psychology. Filed with the Office of the Secretary of State on September 16, TRD-201503822 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 463.9 The Texas State Board of Examiners of Psychologists proposed new rule 463.9, Licensed Specialist in School Psychology. The proposed new rule is intended to replace the current version of the rule and reflects a collaborative effort by the Board and its stakeholders to consolidate the rules governing supervision into a more intuitive format. The proposed new rule sets forth the same requirements for licensure as the current rule, and seeks to clarify the requirements for licensure. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed new rule will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no additional economic costs to persons required to comply with this rule. There will be no adverse effect on small businesses or local economies. Comments on the proposed new rule may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The new rule is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 463.9. Licensed Specialist in School Psychology. (a) Application Requirements. A completed application for licensure as a specialist in school psychology includes the following, in addition to the requirements set forth in Board rule 463.5 of this title (relating to Application File Requirements): (1) Documentation of an appropriate graduate degree; (2) Documentation from the National School Psychologists' Certification Board sent directly to the Board indicating the applicant holds current valid certification as a National Certified School Psychologist (NCSP); or documentation of the following sent directly to the Board: (A) transcripts that verify that the applicant has met the requirements set forth in subsection (b) of this section; (B) proof of the internship required by subsection (c) of this section if the applicant did not graduate from either a training 40 TexReg 6830 October 2, 2015 Texas Register

program approved by the National Association of School Psychologists (NASP) or a training program in school psychology accredited by the American Psychological Association (APA); and (C) the score that the applicant received on the School Psychology Examination sent directly from the Education Testing Service; and (3) Reference letters from three different individuals licensed as psychologists or specialists in school psychology, or credentialed in school psychology in their respective jurisdictions. (b) Training Qualifications. (1) Applicants for licensure as a specialist in school psychology who hold a valid NCSP certification or who have graduated from a training program approved by the National Association of School Psychologists or accredited in School Psychology by the American Psychological Association will be considered to have met the training and internship requirements of this rule. (2) Applicants for licensure who do not hold a valid NCSP certification, or who did not graduate from a training program approved by the National Association of School Psychologists or accredited in School Psychology by the American Psychological Association, must have completed a graduate degree in psychology from a regionally accredited academic institution. Applicants applying under this paragraph must have completed, either as part of their graduate degree program or after conferral of their graduate degree, at least 60 graduate level semester credit hours from a regionally accredited academic institution. A maximum of 12 internship hours may be counted toward the 60 hour requirement. For purposes of this rule, a graduate degree in psychology means the name of the candidate's major or program of studies is titled psychology. Applicants applying under this paragraph must submit evidence of graduate level coursework as follows: (C) Educational Foundations, including any of the following: (A) (i) Psychological Foundations, including: biological bases of behavior; (ii) human learning; (iii) (iv) social bases of behavior; multi-cultural bases of behavior; (v) child or adolescent development; (vi) psychopathology or exceptionalities; (B) Research and Statistics; (D) (i) instructional design; (ii) organization and operation of schools; (iii) classroom management; or (iv) (i) socio-emotional, including behavioral and cul- (ii) tural, assessment; educational administration; Assessment, including: psychoeducational assessment; (E) Interventions, including: (i) counseling; (ii) behavior management; (iii) consultation; (F) Professional, Legal and Ethical Issues; and (G) A Practicum. (c) Completion of internship. (1) Applicants must have completed a minimum of 1200 hours, of which 600 must be in a public school. A formal internship or other site-based training must be provided through a formal course of supervised study from a regionally accredited institution of higher education in which the applicant was enrolled or be obtained in accordance with Board rule 463.11(c)(1) and (c)(2)(c) of this title (relating to Licensed Psychologist). The internship in the public school must be supervised by an individual qualified in accordance with Board rule 465.38 of this title (relating to Psychological Services in the Schools). Internship which is not obtained in a public school must be supervised by a licensed psychologist. No experience with a supervisor who is related within the second degree of affinity or within the second degree by consanguinity to the person, or is under Board disciplinary order, may be considered for specialist in school psychology licensure. Internships may not involve more than two sites (a school district is considered one site) and must be obtained in not less than one or more than two academic years. These individuals must be designated as interns. Direct, systematic supervision must involve a minimum of one face-to-face contact hour per week or two consecutive face-to-face contact hours once every two weeks with the intern. The internship must include direct intern application of assessment, intervention, behavior management, and consultation, for children representing a range of ages, populations and needs. (2) Applicants must have completed an internship with a minimum of 1200 hours. The internship must also meet the following criteria: (A) At least 600 of the internship hours must have been completed in a public school. (B) The internship must be provided through a formal course of supervised study from a regionally accredited institution of higher education in which the applicant was enrolled; or the internship must have been obtained in accordance with Board rule 463.11(d)(1) and (d)(2)(c) of this title. (C) Any portion of an internship completed within a public school must be supervised by a Licensed Specialist in School Psychology, and any portion of an internship not completed within a public school must be supervised by a Licensed Psychologist. (D) No experience which is obtained from a supervisor who is related within the second degree of affinity or consanguinity to the supervisee may be utilized. (E) Unless authorized by the Board, supervised experience received from a supervisor practicing with a restricted license may not be utilized to satisfy the requirements of this rule. (F) Internship hours must be obtained in not more than two placements. A school district, consortium, and educational co-op are each considered one placement. (G) Internship hours must be obtained in not less than one or more than two academic years. (H) An individual completing an internship under this rule must be designated as an intern. (I) Supervision must include an average of two hours of individual direct face to face systematic supervision per full time week. Supervision time maybe adjusted proportionally for less than a full time week or schedule. PROPOSED RULES October 2, 2015 40 TexReg 6831

(J) The internship must include direct intern application of assessment, intervention, behavior management, and consultation, for children representing a range of ages, populations and needs. (3) Paragraph (2) of this subsection, along with all of its subparts, shall take effect, supersede, and take the place of paragraph (1) of this subsection on September 1, 2017. (d) Additional Requirements. In addition to the requirements of subsection (a) through (c) of this section, applicants for licensure as a specialist in school psychology must meet the requirements imposed under 501.255(a)(2) - (9) of the Psychologists' Licensing Act. (e) Examinations. Applicants must take the National School Psychology Examination and obtain at least the current cut-off score for the NCSP certification before applying for licensure as a specialist in school psychology. Following approval to sit for Board exams, an applicant must take and pass the Jurisprudence Examination within the time required by Board rule 463.19 of this title (relating to Time Limit on Examination Failures and Passing Score). (f) Trainee Status. (1) An applicant for the specialist in school psychology license who has not yet passed the Board's Jurisprudence Examination, but who otherwise meets all licensing requirements under this rule, may practice in the public schools under the supervision of a Licensed Specialist in School Psychology, as a trainee for not more than one year. (2) A trainee status letter shall be issued to an applicant upon proof of licensing eligibility, save and except proof of passage of the Board's Jurisprudence Examination. (3) An individual with trainee status is subject to all applicable laws governing the practice of psychology. (4) A trainee's status shall be suspended or revoked upon a showing of probable cause of a violation of the Board's rules or any law pertaining to the practice of psychology, and the individual may be made the subject of an eligibility proceeding. The one year period for trainee status shall not be tolled by any suspension of the trainee status. (5) Following official notification from the Board upon passage of the Jurisprudence Examination or the expiration of one year, whichever occurs first, an individual's trainee status shall terminate. (6) An individual practicing under trainee status must be designated as a trainee. (g) Provision of psychological services in the public schools by unlicensed individuals. An unlicensed individual may provide psychological services under supervision in the public schools if: (1) the individual is enrolled in an internship, practicum or other site based training in a psychology program in a regionally accredited institution of higher education; (2) the individual has completed an internship that meets the requirements of this rule, and has submitted an application for licensure as a Licensed Specialist in School Psychology to the Board that has not been denied, returned, or gone void under Board rule 463.2 of this title (relating to Application Process); or (3) the individual has been issued a trainee status letter. Filed with the Office of the Secretary of State on September 16, TRD-201503833 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 463.10 (Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the Texas State Board of Examiners of Psychologists or in the Texas Register office, James Earl Rudder Building, 1019 Brazos Street, Austin, Texas.) The Texas State Board of Examiners of Psychologists proposes the repeal of 463.10, Provisionally Licensed Psychologists. The proposed repeal is necessary due to the extensive changes proposed for this rule. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed repeal will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no effect on small businesses or local economies. Comments on the proposed repeal may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Suite 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The repeal is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 463.10. Provisionally Licensed Psychologists. Filed with the Office of the Secretary of State on September 16, TRD-201503823 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 463.10 40 TexReg 6832 October 2, 2015 Texas Register

The Texas State Board of Examiners of Psychologists proposes new rule 463.10, Provisionally Licensed Psychologist. The proposed new rule is intended to replace the current version of the rule and reflects a collaborative effort by the Board and its stakeholders to consolidate the rules governing supervision into a more intuitive format. The proposed new rule sets forth the same requirements for licensure as the current rule, and will allow applicants to begin the application process up to 60 days prior to receiving their degree. The proposed new rule also establishes the status of provisional trainee for those applicants who have not yet passed the EPPP or Jurisprudence Examination, but who wish to begin acquiring the supervised experience needed for full licensure. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed new rule will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no additional economic costs to persons required to comply with this rule, other than the costs of applying for licensure. There will be no adverse effect on small businesses or local economies. Comments on the proposed new rule may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The new rule is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 463.10. Provisionally Licensed Psychologists. (a) Application Requirements. (1) An application for provisional licensure as a psychologist includes, in addition to the requirements set forth in Board rule 463.5 of this title (relating to Application File Requirements), an official transcript which indicates that the applicant has received a doctoral degree in psychology. Additionally, the applicant must meet the requirements of 501.255 of the Psychologists' Licensing Act. (2) An application for provisional licensure as a psychologist may be filed up to sixty days prior to the date the applicant's doctoral degree is officially conferred, but remains subject to Board rule 463.2 of this title (relating to Application Process). Furthermore, an applicant may be approved to sit for examinations prior to the Board receiving an official transcript, but no license will be granted until the Board receives an official transcript meeting the requirements of this rule. (b) Degree Requirements. (1) The applicant's transcript must state that the applicant has a doctoral degree that designates a major in psychology. Additionally, the doctoral degree must be from a program accredited by the American Psychological Association or from a regionally accredited institution. (2) The substantial equivalence of a doctoral degree received prior to January 1, 1979, based upon a program of studies whose content is primarily psychological means a doctoral degree based on a program which meets the following criteria: (A) Post-baccalaureate program in a regionally accredited institution of higher learning. The program must have a minimum of 90 semester hours, not more than 12 of which are credit for doctoral dissertation and not more than six of which are credit for master's thesis. (B) The program, wherever it may be administratively housed, must be clearly identified and labeled. Such a program must specify in pertinent institutional catalogs and brochures its intent to educate and train professional psychologists. (C) The program must stand as a recognizable, coherent organizational entity within the institution. A program may be within a larger administrative unit, e.g., department, area, or school. (D) There must be a clear authority and primary responsibility for the core and specialty areas whether or not the program cuts across administrative lines. The program must have identifiable faculty and administrative heads who are psychologists responsible for the graduate program. Psychology faculty are individuals who are licensed or provisionally licensed or certified psychologists, or specialists of the American Board of Professional Psychology (ABPP), or hold a doctoral degree in psychology from a regionally accredited institution. (E) The program must be an integrated, organized sequence of studies, e.g., there must be identifiable curriculum tracks wherein course sequences are outlined for students. (F) The program must have an identifiable body of students who matriculated in the program. (G) The program must include supervised practicum, internship, field or laboratory training appropriate to the practice of psychology. The supervised field work or internship must have been a minimum of 1,500 supervised hours, obtained in not less than a 12 month period nor more than a 24 month period. Further, this requirement cannot have been obtained in more than two placements or agencies. (H) The curriculum shall encompass a minimum of two academic years of full-time graduate studies for those persons who have enrolled in the doctoral degree program after completing the requirements for a master's degree. The curriculum shall encompass a minimum of four academic years of full-time graduate studies for those persons who have entered a doctoral program following the completion of a baccalaureate degree and prior to the awarding of a master's degree. It is recognized that educational institutions vary in their definitions of full-time graduate studies. It is also recognized that institutions vary in their definitions of residency requirements for the doctoral degree. (I) The following curricular requirements must be met and demonstrated through appropriate course work: (i) Scientific and professional ethics related to the field of psychology. (ii) Research design and methodology, statistics. (iii) The applicant must demonstrate competence in each of the following substantive areas. The competence standard will be met by satisfactory completion at the B level of a minimum of six graduate semester hours in each of the four content areas. It is recognized that some doctoral programs have developed special competency examinations in lieu of requiring students to complete course work in all core areas. Graduates of such programs who have not completed the PROPOSED RULES October 2, 2015 40 TexReg 6833

necessary semester hours in these core areas must submit to the Board evidence of competency in each of the four core areas. (I) Biological basis of behavior: physiological psychology, comparative psychology, neuropsychology, sensation and perception, psycho-pharmacology. (II) Cognitive-affective basis of behavior: Learning, thinking, motivation, emotion. (III) Social basis of behavior: social psychology, group processes, organizational and system theory. (IV) Individual differences: personality theory, human development, abnormal psychology. (J) All educational programs which train persons who wish to be identified as psychologists will include course requirements in specialty areas. The applicant must demonstrate a minimum of 24 hours in his/her designated specialty area. (3) Any person intending to apply for provisional licensure under the substantial equivalence clause must file with the Board an affidavit showing: (A) Courses meeting each of the requirements noted in paragraph (2) of this subsection verified by official transcripts; (B) Information regarding each of the instructors in the courses submitted as substantially equivalent; (C) Appropriate, published information from the university awarding the degree, demonstrating that in paragraph (2)(A) - (J) of this subsection have been met. (c) An applicant for provisional licensure as a psychologist who is accredited by Certificate of Professional Qualification in Psychology (CPQ) or the National Register or who is a specialist of ABPP will have met the following requirements for provisional licensure: submission of an official transcript which indicates the date the docprovincial health licensing toral degree in psychology was awarded or conferred, submission of documentation of the passage of the national psychology examination at the doctoral level at the Texas cut-off score, and submission of three acceptable reference letters. All other requirements for provisional licensure must be met by these applicants. Additionally, these applicants must provide documentation sent directly from the qualifying entity to the Board office declaring that the applicant is a current member in the organization and has had no disciplinary action from any state or board. (d) Trainee Status for Provisional Applicants. (1) An applicant for provisional licensure who has not yet passed the EPPP and Jurisprudence Examination, but who otherwise meets all provisional licensing requirements and is seeking to acquire the supervised experience required by 501.252(b)(2) of the Psychologists' Licensing Act, may practice under the supervision of a Licensed Psychologist as a provisional trainee for not more than one year. (2) A provisional trainee status letter shall be issued to an applicant upon proof of provisional licensing eligibility, save and except proof of passage of the EPPP and Jurisprudence Examination. (3) An individual with trainee status is subject to all applicable laws governing the practice of psychology. (4) A provisional trainee's status shall be suspended or revoked upon a showing of probable cause of a violation of the Board's rules or any law pertaining to the practice of psychology, and the individual may be made the subject of an eligibility proceeding. The one year period for provisional trainee status shall not be tolled by any suspension of the provisional trainee status. (5) Following official notification from the Board upon passage of the EPPP and Jurisprudence Examination, or the expiration of one year, whichever occurs first, an individual's provisional trainee status shall terminate. Filed with the Office of the Secretary of State on September 16, TRD-201503834 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 463.11 (Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the Texas State Board of Examiners of Psychologists or in the Texas Register office, James Earl Rudder Building, 1019 Brazos Street, Austin, Texas.) The Texas State Board of Examiners of Psychologists proposes the repeal of 463.11, Licensed Psychologist. The proposed repeal is necessary due to the extensive changes proposed for this rule. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed repeal will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no effect on small businesses or local economies. Comments on the proposed repeal may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Suite 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The repeal is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 463.11. Licensed Psychologist. Filed with the Office of the Secretary of State on September 16, 40 TexReg 6834 October 2, 2015 Texas Register

TRD-201503824 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 463.11 The Texas State Board of Examiners of Psychologists proposes new 463.11, Licensed Psychologist. The proposed new rule is intended to replace the current version of the rule and reflects a collaborative effort by the Board and its stakeholders to consolidate the rules governing supervision into a more intuitive format. The proposed new rule requires applicants to complete a formal internship as part of their doctoral program, complete a total of 4,000 hours of supervised experience, and expands the number of formal internship programs specifically recognized by rule. The proposed new rule also requires the post-doctoral supervised experience be obtained as a provisional trainee or provisionally licensed psychologist, and clearly identifies the time frames for obtaining supervised experience. Lastly, the proposed new rule simplifies and clarifies the procedure for addressing gaps in an applicant's supervised experience. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed new rule will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no additional economic costs to persons required to comply with this rule. There will be no adverse effect on small businesses or local economies. Comments on the proposed new rule may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The new rule is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 463.11. Licensed Psychologist. (a) Application Requirements. Application for licensure as a psychologist may be made upon passage of, or exemption from the Oral Examination. An application for licensure as a psychologist includes, in addition to the requirements set forth in Board rule 463.5(1) of this title (relating to Application File Requirements): (1) Documentation of current licensure as a provisionally licensed psychologist in good standing. (2) Documentation indicating passage of or exemption from the Board's Oral Examination. (3) Documentation of supervised experience from a licensed psychologist which satisfies the requirements of the Board. The formal internship must be documented by the Director of Internship Training. (4) Documentation of licensure in other jurisdictions, including information on disciplinary action and pending complaints, sent directly to the Board. (b) Degree Requirements. The degree requirements for licensure as a psychologist are the same as for provisional licensure as stated in Board rule 463.10 of this title (relating to Provisionally Licensed Psychologist). (c) Supervised Experience. In order to qualify for licensure, a psychologist must submit proof of two years of supervised experience, at least one year of which must have been received after the doctoral degree was officially conferred or completed, whichever is earliest, as shown on the official transcript, and at least one year of which must have been a formal internship. The formal internship year may be met either before or after the doctoral degree is conferred or completed. Supervised experience must be obtained in a minimum of two, and no more than three, calendar years, for full-time experience. (1) General. All supervised experience for licensure as a psychologist, including the formal internship, must meet the following requirements: (A) Experience may be obtained only in either a fulltime or half-time setting. (B) A year of full-time supervised experience is defined as a minimum of 35 hours per week employment/experience in not less than 12 consecutive calendar months in not more than two placements. (C) A year of half-time supervised experience is defined as a minimum of 20 hours per week employment/experience in not less than 24 consecutive calendar months in not more than two placements. (D) A year of full-time experience may be acquired through a combination of half-time and full-time employment/experience provided that the equivalent of a full-time year of supervision experience is satisfied. (E) One calendar year from the beginning of ten consecutive months of employment/experience in an academic setting constitutes one year of experience. (F) When supervised experience is interrupted, the Board may waive upon a showing of good cause by the supervisee, the requirement that the supervised experience be completed in consecutive months. Any consecutive experience obtained before or after the gap must be at least six months unless the supervisor remains the same. Waivers for such gaps are rarely approved and must be requested in writing and include sufficient documentation to permit verification of the circumstances supporting the request. No waiver will be granted unless the Board finds that the supervised experience for which the waiver is sought was adequate and appropriate. Good cause is defined as: (i) unanticipated discontinuance of the supervision setting, (ii) maternity or paternity leave of supervisee, (iii) relocation of spouse or spousal equivalent, (iv) serious illness of the supervisee, or serious illness in supervisee's immediate family. (G) A rotating internship organized within a doctoral program is considered to be one placement. PROPOSED RULES October 2, 2015 40 TexReg 6835

(H) The experience requirement must be obtained after official enrollment in a doctoral program. (I) All supervised experience must be received from a psychologist licensed at the time supervision is received. (J) The supervising psychologist must be trained in the area of supervision provided to the supervisee. (K) No experience which is obtained from a psychologist who is related within the second degree of affinity or within the second degree by consanguinity to the person may be considered. (L) All supervised experience obtained for the purpose of licensure must be conducted in accordance with all applicable Board rules. (M) Experience received from a psychologist while the psychologist is practicing subject to an Agreed Board Order or Board Order shall not, under any circumstances, qualify as supervised experience for licensure purposes regardless of the setting in which it was received. Psychologists who become subject to an Agreed Board Order or Board Order shall inform all supervisees of the Agreed Board Order or Board Order and assist all supervisees in finding appropriate alternate supervision. (N) The supervisee shall be designated by a title that clearly indicates a supervisory licensing status such as "intern," "resident," "trainee," or "fellow." An individual who is a provisionally licensed psychologist or a licensed psychological associate may use this title so long as those receiving psychological services are clearly informed that the individual is under the supervision of a licensed psychologist. Use of a different job title is permitted only if the supervisee is providing services for a government facility or other facility exempted under 501.004 of the Act (Applicability) and the supervisee is using a title assigned by that facility. (O) The supervisee and supervisor must clearly inform those receiving psychological services as to the supervisory status of the individual and how the patient or client may contact the supervising licensed psychologist directly. (2) Formal Internship. At least one year of experience must be satisfied by one of the following types of formal internship: (A) The successful completion of an internship program accredited by the American Psychological Association (APA); or (B) The successful completion of an organized internship meeting all of the following criteria: (i) It must constitute an organized training program which is designed to provide the intern with a planned, programmed sequence of training experiences. The primary focus and purpose of the program must be to assure breadth and quality of training. (ii) The internship agency must have a clearly designated staff psychologist who is responsible for the integrity and quality of the training program and who is actively licensed/certified by the licensing board of the jurisdiction in which the internship takes place and who is present at the training facility for a minimum of 20 hours a week. (iii) The internship agency must have two or more full-time licensed psychologists on the staff as primary supervisors. (iv) Internship supervision must be provided by a staff member of the internship agency or by an affiliate of that agency who carries clinical responsibility for the cases being supervised. (v) The internship must provide training in a range of assessment and intervention activities conducted directly with patients/clients. (vi) At least 25% of trainee's time must be in direct patient/client contact (minimum 375 hours). (vii) The internship must include a minimum of two hours per week (regardless of whether the internship was completed in one year or two) of regularly scheduled formal, face-to-face individual supervision. There must also be at least two additional hours per week in learning activities such as: case conferences involving a case in which the intern was actively involved; seminars dealing with psychology issues; co-therapy with a staff person including discussion; group supervision; additional individual supervision. (viii) Training must be post-clerkship, postpracticum and post-externship level. (ix) The internship agency must have a minimum of two full-time equivalent interns at the internship level of training during applicant's training period. (x) The internship agency must inform prospective interns about the goals and content of the internship, as well as the expectations for quantity and quality of trainee's work; or (C) The successful completion of an organized internship program in a school district meeting the following criteria: (i) The internship experience must be provided at or near the end of the formal training period. (ii) The internship experience must occur on a fulltime basis over a period of one academic year, or on a half-time basis over a period of two consecutive academic years. (iii) The internship experience must be consistent with a written plan and must meet the specific training objectives of the program. (iv) The internship experience must occur in a setting appropriate to the specific training objectives of the program. (v) At least 600 clock hours of the internship experience must occur in a school setting and must provide a balanced exposure to regular and special educational programs. (vi) The internship experience must occur under conditions of appropriate supervision. Field-based internship supervisors, for the purpose of the internship that takes place in a school setting, must be licensed as a psychologist and, if a separate credential is required to practice school psychology, must have a valid credential to provide psychology in the public schools. The portion of the internship which appropriately may take place in a non-school setting must be supervised by a psychologist. (vii) Field-based internship supervisors must be responsible for no more than two interns at any given time. University internship supervisors shall be responsible for no more than twelve interns at any given time. (viii) Field-based internship supervisors must provide at least two hours per week of direct supervision for each intern. University internship supervisors must maintain an ongoing relationship with field-based internship supervisors and shall provide at least one field-based contact per semester with each intern. (ix) The internship site shall inform interns concerning the period of the internship and the training objectives of the program. 40 TexReg 6836 October 2, 2015 Texas Register

(x) The internship experience must be systematically evaluated in a manner consistent with the specific training objectives of the program. (xi) The internship experience must be conducted in a manner consistent with the current legal-ethical standards of the profession. (xii) The internship agency must have a minimum of two full-time equivalent interns at the internship level during the applicant's training period. (xiii) The internship agency must have the availability of at least two full-time equivalent psychologists as primary supervisors, at least one of whom is employed full time at the agency and is a school psychologist. (3) Industrial/Organizational Requirements. Individuals enrolled in an Industrial/Organizational doctoral degree program are exempt from the formal internship requirement and must complete two full years of supervised experience, at least one of which must be received after the doctoral degree is conferred and both of which must meet the requirements of paragraph (1) of this subsection. Individuals who do not undergo a formal internship pursuant to this paragraph should note that Board rules prohibit a psychologist from practicing in an area in which she does not have sufficient training and experience, of which a formal internship year is considered to be an integral requirement. (d) Supervised Experience. In order to qualify for licensure, an applicant must submit proof of a minimum of 4,000 hours of supervised experience, at least 2,000 of which must have been received after obtaining either provisional trainee status or provisional licensure, and at least 2,000 of which must have been obtained through a formal internship that occurred prior to conferral of the doctoral degree. Following the conferral of a doctoral degree, 2,000 hours obtained while employed in the delivery of psychological services in an exempt facility, under the supervision of a licensed psychologist, may be substituted for the minimum of 2,000 hours of supervised experience required as a provisional trainee or provisionally licensed psychologist. (1) General. All supervised experience for licensure as a psychologist, including the formal internship, must meet the following requirements: (A) Each period of supervised experience must be obtained in not more than two placements, and in not more than 24 consecutive months. (B) Gaps Related to Supervised Experience. (i) Unless a waiver is granted by the Board, an application for a psychologist's license will be denied if a gap of more than 2 years exists between: (I) the date an applicant's doctoral degree was officially conferred and the date the applicant began obtaining their hours of supervised experience under provisional trainee status or provisional licensure; or (II) the completion date of an applicant's hours of supervised experience acquired as a provisional trainee or provisionally licensed psychologist, and the date of application. (ii) The Board shall grant a waiver upon a showing of good cause by the applicant. Good cause shall include, but is not limited to: (I) proof of continued employment in the delivery of psychological services in an exempt setting as described in 501.004 of the Act, during any gap period; (II) proof of annual professional development, which at a minimum meets the Board's professional development requirements, during any gap period; (III) proof of enrollment in a course of study in a regionally accredited institution or training facility designed to prepare the individual for the profession of psychology during any gap period; or (IV) proof of licensure as a psychologist and continued employment in the delivery of psychological services in another jurisdiction. (C) A formal internship with rotations, or one that is part of a consortium within a doctoral program, is considered to be one placement. A consortium is composed of multiple placements that have entered into a written agreement setting forth the responsibilities and financial commitments of each participating member, for the purpose of offering a well-rounded, unified psychology training program whereby trainees work at multiple sites, but obtain training from one primary site with some experience at or exposure to aspects of the other sites that the primary site does not offer. (D) The supervised experience required by this rule must be obtained after official enrollment in a doctoral program. (E) All supervised experience must be received from a psychologist licensed at the time supervision is received. (F) The supervising psychologist must be trained in the area of supervision provided to the supervisee. (G) Experience obtained from a psychologist who is related within the second degree of affinity or consanguinity to the supervisee may not be utilized to satisfy the requirements of this rule. (H) All supervised experience obtained for the purpose of licensure must be conducted in accordance with all applicable Board rules. (I) Unless authorized by the Board, supervised experience received from a psychologist practicing with a restricted license may not be utilized to satisfy the requirements of this rule. (J) The supervisee shall be designated by a title that clearly indicates a supervisory licensing status such as "intern," "resident," "trainee," or "fellow." An individual who is a Provisionally Licensed Psychologist or a Licensed Psychological Associate may use his or her title so long as those receiving psychological services are clearly informed that the individual is under the supervision of a licensed psychologist. An individual who is a Licensed Specialist in School Psychology may use his or her title so long as the supervised experience takes place within the public schools, and those receiving psychological services are clearly informed that the individual is under the supervision of an individual who is licensed as a psychologist and specialist in school psychology. Use of a different job title is permitted only if authorized under 501.004 of the Psychologists' Licensing Act, or another Board rule. (2) Formal Internship. The formal internship hours must be satisfied by one of the following types of formal internships: (A) The successful completion of an internship program accredited by the American Psychological Association (APA) or Canadian Psychological Association (CPA), or which is a member of the Association of Psychology Postdoctoral and Internship Centers (APPIC); or (B) The successful completion of an organized internship meeting all of the following criteria: PROPOSED RULES October 2, 2015 40 TexReg 6837

(i) It must constitute an organized training program which is designed to provide the intern with a planned, programmed sequence of training experiences. The primary focus and purpose of the program must be to assure breadth and quality of training. (ii) The internship agency must have a clearly designated staff psychologist who is responsible for the integrity and quality of the training program and who is actively licensed/certified by the licensing board of the jurisdiction in which the internship takes place and who is present at the training facility for a minimum of 20 hours a week. (iii) The internship agency must have two or more full-time licensed psychologists on the staff as primary supervisors. (iv) Internship supervision must be provided by a staff member of the internship agency or by an affiliate of that agency who carries clinical responsibility for the cases being supervised. (v) The internship must provide training in a range of assessment and intervention activities conducted directly with patients/clients. (vi) At least 25% of trainee's time must be in direct patient/client contact (minimum 375 hours). (vii) The internship must include a minimum of two hours per week of regularly scheduled formal, face-to-face individual supervision. There must also be at least four additional hours per week in learning activities such as: case conferences involving a case in which the intern was actively involved; seminars dealing with psychology issues; co-therapy with a staff person including discussion; group supervision; additional individual supervision. (viii) Training must be post-clerkship, postpracticum and post-externship level. (ix) The internship agency must have a minimum of two full-time equivalent interns at the internship level of training during applicant's training period. (x) The internship agency must inform prospective interns about the goals and content of the internship, as well as the expectations for quantity and quality of trainee's work, including expected competencies; or (C) The successful completion of an organized internship program in a school district meeting the following criteria: (i) The internship experience must be provided at or near the end of the formal training period. (ii) The internship experience must require a minimum of 35 hours per week over a period of one academic year, or a minimum of 20 hours per week over a period of two consecutive academic years. (iii) The internship experience must be consistent with a written plan and must meet the specific training objectives of the program. (iv) The internship experience must occur in a setting appropriate to the specific training objectives of the program. (v) At least 600 clock hours of the internship experience must occur in a school setting and must provide a balanced exposure to regular and special educational programs. (vi) The internship experience must occur under conditions of appropriate supervision. Field-based internship supervisors, for the purpose of the internship that takes place in a school setting, must be licensed as a psychologist and, if a separate credential is required to practice school psychology, must have a valid credential to provide psychology in the public schools. The portion of the internship which appropriately may take place in a non-school setting must be supervised by a psychologist. (vii) Field-based internship supervisors must be responsible for no more than two interns at any given time. University internship supervisors shall be responsible for no more than twelve interns at any given time. (viii) Field-based internship supervisors must provide at least two hours per week of direct supervision for each intern. University internship supervisors must maintain an ongoing relationship with field-based internship supervisors and shall provide at least one field-based contact per semester with each intern. (ix) The internship site shall inform interns concerning the period of the internship and the training objectives of the program. (x) The internship experience must be systematically evaluated in a manner consistent with the specific training objectives of the program. (xi) The internship experience must be conducted in a manner consistent with the current legal-ethical standards of the profession. (xii) The internship agency must have a minimum of two full-time equivalent interns at the internship level during the applicant's training period. (xiii) The internship agency must have the availability of at least two full-time equivalent psychologists as primary supervisors, at least one of whom is employed full time at the agency and is a school psychologist. (3) Industrial/Organizational Requirements. Individuals enrolled in an Industrial/Organizational doctoral degree program are exempt from the formal internship requirement but must complete 4,000 hours of supervised experience meeting the requirements of paragraph (1) of this subsection, at least 2,000 of which must have been received as a provisional trainee or provisionally licensed psychologist. Individuals who do not undergo a formal internship pursuant to this paragraph should note that Board rules prohibit a psychologist from practicing in an area in which they do not have sufficient training and experience, of which a formal internship is considered to be an integral requirement. (4) Licensure Following Retraining. (A) In order to qualify for licensure after undergoing retraining, an applicant must demonstrate the following: (i) conferral of a doctoral degree in psychology from a regionally accredited institution of higher education prior to undergoing retraining; (ii) completion of a formal, accredited post-doctoral retraining program in psychology which included at least 2,000 hours in a formal internship; (iii) retraining within the two year period preceding the date of application for licensure under this rule, or continuous employment in the delivery of psychological services in an exempt setting as described in 501.004 of the Psychologists' Licensing Act since receiving their doctoral degree; and (iv) upon completion of the retraining program, at least 2,000 hours of supervised experience after obtaining either provisional trainee status or provisional licensure. 40 TexReg 6838 October 2, 2015 Texas Register

(B) An applicant meeting the requirements of this subsection is considered to have met the requirements for supervised experience under this rule. (e) Effective Date of Change Regarding Supervised Experience. Subsection (d) of this section, along with all of its subparts, shall take effect, supersede, and take the place of subsection (c) of this section on September 1, 2017. Filed with the Office of the Secretary of State on September 16, TRD-201503835 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 463.20 The Texas State Board of Examiners of Psychologists proposes amendments to 463.20, Refunds and Transfer of Application and Examination Fees. The proposed amendment is necessary to comport with the repeal of the $200 occupational fee assessed in Texas Occupations Code Ann. 501.153. See Tex. H.B. 7, 84th Leg., R.S. (2015), Section 31. The effective date of the repeal is September 1, Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed amendment will be in effect, the state will incur those negative fiscal implications set forth in the fiscal note for Tex. H.D. 7, 84th Leg., R.S. (2015). Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no adverse effect on small businesses or local economies. Comments on the proposed amendment may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The amendment is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 463.20. Refunds and Transfer of Application and Examination Fees. (a) Application fees are non-refundable and non-transferable. [(b) The $200 professional fee paid to the Board in connection with a request for approval to take the EPPP examination is non-refundable. The professional fee may however, upon review of documentation demonstrating good cause, be transferred on a one-time basis to a subsequent request for approval to take the EPPP examination.] (b) [(c)] The Oral Examination fee may be transferred to a subsequent examination when an applicant fails to appear for their scheduled examination, if an applicant makes a written request for a transfer and provides the Board with documentation demonstrating good cause for why the applicant failed to appear on their scheduled examination date. Upon written request and showing of good cause, the Board shall excuse the applicant's failure to appear, and allow the examination fee to be applied, one time only, toward the next regularly scheduled examination. (c) [(d)] The Jurisprudence Examination fee may be transferred to a subsequent examination when an applicant fails to timely complete the examination, if an applicant makes a written request for a transfer and provides the Board with documentation demonstrating good cause for why the applicant failed to timely complete the examination. Upon written request and showing of good cause, the Board shall excuse the applicant's failure to timely complete the examination, and allow the Board's portion of the examination fee to be applied, one time only, toward a subsequent examination. The Applicant however, must pay that portion of the examination fee attributable to the third-party vendor administering the online examination, before they will be allowed to retake the examination. Filed with the Office of the Secretary of State on September 16, TRD-201503836 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 463.30 The Texas State Board of Examiners of Psychologists proposed amendments to 463.30, Licensing for Military Service Members, Veterans and Spouses. The proposed amendments are necessary to comply with the changes made to Ch. 55, Occupations Code, by Tex. S.B. 1307, 84th Leg., R.S. (2015) and Tex. H.B. 3742, 84th Leg., R.S. (2015). Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed amendments will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no adverse effect on small businesses or local economies. Comments on the proposed amendments may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments PROPOSED RULES October 2, 2015 40 TexReg 6839

may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The amendment is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 463.30. Licensing for [of] Military Service Members, Veterans and Spouses [and Applicants with Military Experience]. (a) Military Service Members, Veterans and Spouses. (1) A license may be issued to a military service member, military veteran, or military spouse, as those terms are defined by Chapter 55, Occupations Code, provided that the following documentation is provided to the Board: (A) if the applicant is a military spouse, proof of [the] marriage to a military service member; and [the spouse of an active duty member of the armed forces; and] (B) proof that the applicant holds a current license in another jurisdiction that has licensing requirements that are substantially equivalent to the requirements for the license in this state; or [spouse holds a current license in another state and the licensing requirements for the license in the other state are substantially equivalent to the requirements for the license in Texas; or] (C) proof that within the five years preceding the application date, the spouse held the license in Texas. [and it expired while the applicant lived in another state for at least six months.] (2) An applicant applying for licensure under paragraph (1) of this subsection must provide documentation from all other jurisdictions [states] in which the applicant is licensed that indicate that the applicant has received no disciplinary action from those jurisdictions [states] regarding a mental health license. (3) As part of the application process, the Executive Director may waive any prerequisite for obtaining a license under this rule, other than paragraph (1)(B) and (C) of this subsection and the jurisprudence examination, if it is determined that the applicant's education, training, and experience provide reasonable assurance that the applicant has the knowledge and skills necessary for entry-level practice under the license sought. When making this determination, the Executive Director must consult with the Board's Applications Committee and consider the committee's input and recommendations. In the event the Executive Director does not follow a recommendation of the Applications Committee, he or she must submit a written explanation to the Applications Committee explaining why its recommendation was not followed. No waiver may be granted where a military service member or military veteran holds a license issued by another jurisdiction that has been restricted, or where the applicant has an unacceptable criminal history. (4) [(3)] Alternative demonstrations of competency to meet the requirements for licensure. The following provisions provide alternative demonstrations of competency to the Board's licensing standards. (A) Licensed Specialist in School Psychology. An applicant [A spouse] that meets the requirements of paragraph (1)[(A) and (B)] of this subsection is considered to have met the following requirements for this type of license: three reference letters, submission of an official transcript, and evidence of the required coursework or National Association of School Psychologists certification, and passage of the National School Psychology Examination. All other requirements for licensure are still required. (B) Licensed Psychological Associate. An applicant that meets the requirements of paragraph (1) of this subsection [A spouse that meets the requirements of paragraph (1)(A) and (B) of this subsection] is considered to have met the following requirements for this type of license: three reference letters, submission of an official transcript, 450 internship hours, and passage of the Examination for Professional Practice (EPPP) in Psychology at the Texas cut-off. All other requirements for licensure are still required. (C) Provisionally Licensed Psychologist. An applicant that meets the requirements of paragraph (1) of this subsection [A spouse who meets the requirements of paragraph (1)(A) and (B) of this subsection] is considered to have met the following requirements for this type of license: three reference letters, submission of an official transcript, and passage of the EPPP at the Texas cut-off. All other requirements for licensure are still required. (D) Licensed Psychologist. An applicant that meets the requirements of paragraph (1) of this subsection [A spouse who meets the requirements of paragraph (1)(A) and (B) of this subsection] is considered to have met the following requirements for this type of license: two years of supervised experience. All other requirements for licensure, including the requirements of this paragraph, are still required. (5) [(4)] Determination of substantial equivalency for licensing requirements in another state. The applicant must provide to the Board proof that the state in which the applicant is licensed has standards for licensure that are substantially equivalent to the requirements of this Board for the applicable license type: (A) Licensed Specialist in School Psychology (the license required to provide psychological services in the public schools). (i) The completion of a training program in school psychology approved/accredited by the American Psychological Association or the National Association of School Psychologists or a master's degree in psychology with specific course work as set forth in Board rule 463.9 of this title (relating to Licensed Specialist in School Psychology); and (ii) Passage of the National School Psychology Examination. (B) Licensed Psychological Associate (the master's level license that requires supervision by a licensed psychologist). (i) Master's degree that is primarily psychological in nature and the degree is at least 42 hours with at least 27 hours in psychology courses; (ii) Passage of the EPPP at the master's level at 55%; and (iii) A minimum of 450 hours of practicum, internship, or experience in psychology, under the supervision of a licensed psychologist. (C) Provisionally Licensed Psychologist (the doctoral level license that must be supervised by a licensed psychologist). (i) Doctoral degree in psychology; and (ii) Passage of the EPPP at the doctoral level at 70%. (D) Licensed Psychologist (the doctoral license that is required to practice independently). (i) Doctoral degree in psychology; (ii) Passage of the EPPP at the doctoral level of 70%; 40 TexReg 6840 October 2, 2015 Texas Register

(iii) Two years of supervised experience by a licensed psychologist; and (iv) Passage of an oral examination. (6) [(5)] Renewal of License Issued to Military Service Members, Veterans, and Spouses [Spouse]. A license issued pursuant to this rule [to a military spouse under paragraph (1)(A) and (B) of this subsection] shall remain active until the last day of the licensee's birth month, [the licensee's birthdate] following a period of one year from the date of issuance of the license, at which time it will be subject to all renewal requirements. (b) Applicants with Military Experience. (1) A military service member or military veteran, as defined by Chapter 55, Occupations Code, shall receive credit toward the following licensing requirements for verified military service, training, or education: (A) Licensed Specialist in School Psychology. A military service member or military veteran who was engaged in or who has been engaged in the delivery of psychological services within the military, for at least one year, is considered to have met the following requirements for this type of license: three reference letters. All other requirements for licensure are still required. (B) Licensed Psychological Associate. A military service member or military veteran who was engaged in or who has been engaged in the delivery of psychological services within the military, for at least one year, is considered to have met the following requirements for this type of license: three reference letters, 450 hours of supervised experience. All other requirements for licensure are still required. (C) Provisionally Licensed Psychologist. A military service member or military veteran who was engaged in or who has been engaged in the delivery of psychological services within the military, for at least one year, is considered to have met the following requirements for this type of license: three reference letters. All other requirements for licensure are still required. (D) Licensed Psychologist. A military service member or military veteran who was engaged in or who has been engaged in the delivery of psychological services within the military, for at least one year following conferral of a doctoral degree, is considered to have met the following requirements for this type of license: one year of postdoctoral supervised experience. All other requirements for licensure are still required. (2) An applicant with an honorable discharge from the United States military either during the application process or within the three year period preceding the date the application is received by the Board, is considered to have met the requirement for one of the three reference letters. (3) A military service member or military veteran may not receive credit toward licensing requirements due to military service, training, or education if they hold a license issued by another jurisdiction that has been restricted, or they have an unacceptable criminal history. Filed with the Office of the Secretary of State on September 16, TRD-201503837 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 CHAPTER 465. RULES OF PRACTICE 22 TAC 465.1 The Texas State Board of Examiners of Psychologists proposes amendments to 465.1, Definitions. The proposed amendments will define "supervision" as that term is used in Board rules, and provide greater clarity and guidance to licensees. The proposed amendment also includes the definition of "child custody evaluation" and "adoption evaluation" as those terms are defined by Tex. H.B. 1449, 84th Leg., R.S. (2015). Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed amendment will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no adverse effect on small businesses or local economies. Comments on the proposed amendment may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The amendment is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 465.1. Definitions. The following terms have the following meanings: (1) "Client" has the same meaning as "patient." (2) "Dual Relationship" means a situation where a licensee and another individual have both a professional relationship and a nonprofessional relationship. Dual relationships include, but are not limited to, personal friendships, business or financial interactions, mutual club or social group activities, family or marital ties, or sexual relationships. (3) "Forensic psychology" is the provision of psychological services involving courts, legal claims, or the legal system. The provision of forensic psychological services includes any and all preliminary and exploratory services, testing, assessments, evaluations, interviews, examinations, depositions, oral or written reports, live or recorded testimony, or any psychological service provided by a licensee concerning a current or potential legal case at the request of a party or potential party, an attorney for a party, or a court, or any other individual or entity, regardless of whether the licensee ultimately provides a report or testimony that is utilized in a legal proceeding. A PROPOSED RULES October 2, 2015 40 TexReg 6841

person who is the subject of forensic evaluation is not considered to be a patient under these rules. "Forensic evaluation" is an evaluation conducted, not for the purpose of providing mental health treatment, but rather at the request of a court, an attorney, or an administrative body including federal and private disability benefits providers to assist in addressing a forensic referral question. Additionally, forensic services would include fitness for duty evaluations, psychological evaluations conducted after an employment offer has been made in high risk professions, and risk assessment evaluations of employees as a result of their aggressive or threatening behavior. (4) "Informed Consent" means the written documented consent of the patient, client and other recipients of psychological services only after the patient, client or other recipient has been made aware of the purpose and nature of the services to be provided, including but not limited to: the specific goals of the services; the procedures to be utilized to deliver the services; possible side effects of the services, if applicable; alternate choices to the services, if applicable; the possible duration of the services; the confidentiality of and relevant limits thereto; all financial policies, including the cost and methods of payment; and any provisions for cancellation of and payments for missed appointments; and right of access of the patient, client or other recipient to the records of the services. (5) "Licensee" means a licensed psychologist, provisionally licensed psychologist, licensed psychological associate, licensed specialist in school psychology, applicants to the Board, and any other individual whom the Board has the authority to discipline under these Rules. (6) "Multiple Relationship" means any relationship between a licensee and another individual involving a professional relationship and a [more than one] non-professional relationship. (7) "Patient" means a person who consults or is interviewed by a licensee for a diagnosis, evaluation, or treatment of any mental or emotional condition or disorder of that person regardless of whether the patient or some other individual or entity paid for the consultation or interview except as identified in paragraph (3) of this section, where the subject of forensic evaluation is not considered to be a patient. (8) "Professional relationship" is any relationship between a licensee and another individual, group or organization in which the licensee delivers psychological services to the individual, group, or organization. (9) "Professional standards" are determined by the Board through its rules, regulations, policies and any other sources adopted by the Board. (10) "Provision of psychological services" means any use by a licensee of his or her education or training in psychology in the context of a professional relationship. Psychological services include, but are not limited to, therapy, diagnosis, testing, assessments, evaluation, treatment, counseling, supervision, consultation, providing forensic opinions, rendering a professional opinion, performing research, or teaching to an individual, group, or organization. (11) "Recognized member of the clergy," as used in 501.004(a)(4) [Section 501.004(a)(4)] of the Act, means a member in good standing of and accountable to a denomination, church, sect or religious organization legally recognized under the Internal Revenue Code, 501(c)(3) [Section 501(c)(3)]. (12) "Records" are any information, regardless of the format in which it is maintained, that can be used to document the delivery, progress or results of any psychological services including, but not limited to, data identifying a recipient of services, dates of services, types of services, informed consents, fees and fee schedules, assessments, treatment plans, consultations, session notes, test results, reports, release forms obtained from a client or patient or any other individual or entity, and records concerning a patient or client obtained by the licensee from other sources. (13) "Report" includes any written or oral assessment, recommendation, psychological diagnostic or evaluative statement containing the professional judgment or opinion of a licensee. (14) "Test data" refers to testing materials, test booklets, test forms, test protocols and answer sheets used in psychological testing to generate test results and test reports. (15) "Supervision" refers to direct, systematic professional oversight of individuals who provide psychological services under the authority of a supervising licensee, whereby the supervisor has the responsibility and ability to monitor and control the psychological services provided to ensure the patient's or client's best interests are met and that the public is protected. In the context of psychological training and education, "supervision" also refers to the formal provision of systematic education and training for purposes of licensure or competency that serves to assist individuals with gaining experience and developing the skills necessary for licensure or competent practice in a particular practice area. However, the term "supervision" does not apply to the supervision of purely administrative or employment matters. (16) "Child custody evaluation" has the same meaning as assigned by Tex. Fam. Code Ann. 107.101. (17) "Adoption evaluation" has the same meaning as assigned by Tex. Fam. Code Ann. 107.151. Filed with the Office of the Secretary of State on September 16, TRD-201503838 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 465.2 (Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the Texas State Board of Examiners of Psychologists or in the Texas Register office, James Earl Rudder Building, 1019 Brazos Street, Austin, Texas.) The Texas State Board of Examiners of Psychologists proposes the repeal of 465.2, Supervision. The proposed repeal is necessary due to the extensive changes proposed for this rule. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed repeal will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to 40 TexReg 6842 October 2, 2015 Texas Register

comply with this rule. There will be no effect on small businesses or local economies. Comments on the proposed repeal may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Suite 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The repeal is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 465.2. Supervision. Filed with the Office of the Secretary of State on September 16, TRD-201503825 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 465.2 The Texas State Board of Examiners of Psychologists proposes new rule 465.2, Supervision. The proposed new rule reflects a collaborative effort by the Board and its stakeholders to align the rules governing supervision with generally acknowledged practice standards, and to consolidate the rules governing supervision into a more intuitive format. The proposed new rule also serves to provide greater protection to the public by establishing clarity and guidance in areas such as documentation of supervision, amounts of direct supervision, and the permissible number of supervisees. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed new rule will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no adverse effect on small businesses or local economies. Comments on the proposed new rule may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The new rule is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 465.2. Supervision. (a) Supervision in General. The following rules apply to all supervisory relationships. (1) A licensee is responsible for the supervision of all individuals that the licensee employs or utilizes to provide psychological services of any kind. (2) Licensees ensure that their supervisees have legal authority to provide psychological services. (3) Licensees delegate only those responsibilities that supervisees may legally and competently perform. (4) All individuals who receive psychological services requiring informed consent from an individual under supervision must be informed in writing of the supervisory status of the individual and how the patient or client may contact the supervising licensee directly. (5) All materials relating to the practice of psychology, upon which the supervisee's name or signature appears, must indicate the supervisory status of the supervisee. Supervisory status must be indicated by one of the following: (A) Supervised by (name of supervising licensee); (B) Under the supervision of (name of supervising licensee); (C) The following persons are under the supervision of (name of supervising licensee); or (D) Supervisee of (name of supervising licensee). (6) Licensees provide an adequate level of supervision to all individuals under their supervision according to accepted professional standards given the experience, skill and training of the supervisee, the availability of other qualified licensees for consultation, and the type of psychological services being provided. (7) Licensees utilize methods of supervision that enable the licensee to monitor all delegated services for legal, competent, and ethical performance. Methods of supervision may include remote or electronic means if: (A) adequate supervision can be provided through remote or electronic means; (B) the difficulties in providing full-time in-person supervision place an unreasonable burden on the delivery of psychological services; and (C) no more than fifty percent of the supervision takes place through remote or electronic means. (8) Licensees must be competent to perform any psychological services being provided under their supervision. (9) Licensees shall document their supervision activities in writing, including any remote or electronic supervision provided. Documentation shall include the dates, times, and length of supervision. (10) Licensees may only supervise the number of supervisees for which they can provide adequate supervision. PROPOSED RULES October 2, 2015 40 TexReg 6843

(b) Supervision of Students, Interns, Residents, Fellows, and Trainees. The following rules apply to all supervisory relationships involving students, interns, residents, fellows, and trainees. (1) Unlicensed individuals providing psychological services pursuant to 501.004(a)(2), 501.252(b)(2), or 501.260(b)(3) of the Act must be under the supervision of a qualified supervising licensee at all times. (2) Supervision must be provided by a qualified supervising licensee before it will be accepted for licensure purposes. (3) A licensee practicing under a restricted status license is not qualified to, and shall not provide supervision for a person seeking to fulfill internship or practicum requirements, or a person seeking licensure under the Psychologists' Licensing Act, regardless of the setting in which the supervision takes place, unless authorized to do so by the Board. A licensee shall inform all supervisees of any Board order restricting their license and assist the supervisees with finding appropriate alternate supervision. (4) A supervisor must document in writing their supervisee's performance during a practicum, internship, or period of supervised experience required for licensure. The supervisor must provide this documentation to the supervisee. (5) An individual subject to this subsection may, as part of a required practicum, internship, or period of supervised experience required for licensure with this Board, supervise others in the delivery of psychological services. (6) For provisional trainees, a supervisor must provide at least one hour of individual supervision per week and may reduce the amount of weekly supervision on a proportional basis for provisional trainees working less than full-time. (7) Licensees may not supervise an individual to whom they are related within the second degree of affinity or consanguinity. (c) Supervision of Provisionally Licensed Psychologists and Licensed Psychological Associates. The following rules apply to all supervisory relationships involving Provisionally Licensed Psychologists and Licensed Psychological Associates. (1) Provisionally Licensed Psychologists and Licensed Psychological Associates must be under the supervision of a Licensed Psychologist and may not engage in independent practice. (2) A Provisionally Licensed Psychologist who is licensed in another state to independently practice psychology and is in good standing in that state, and who has applied for licensure as a psychologist may during the time that the Board is processing the applicant's application for licensure as a psychologist, practice psychology without supervision. However, upon notification from the Board that an applicant has not met the qualifications for licensure as a psychologist, the provisionally licensed psychologists must obtain supervision within 30 days in order to continue to practice. (3) A provisionally licensed psychologist may, as part of a period of supervised experience required for full licensure with this Board, supervise others in the delivery of psychological services. (4) A supervisor must provide at least one hour of individual supervision per week. A supervisor may reduce the amount of weekly supervision on a proportional basis for supervisees working less than full-time. (d) Supervision of Licensed Specialists in School Psychology interns and trainees. The following rules apply to all supervisory relationships involving Licensed Specialists in School Psychology, as well as all interns and trainees working toward licensure as a specialist in school psychology. (1) A supervisor must provide an LSSP trainee with at least one hour of supervision per week, with no more than half being group supervision. A supervisor may reduce the amount of weekly supervision on a proportional basis for trainees working less than full-time. (2) Supervision within the public schools may only be provided by a Licensed Specialist in School Psychology, who has a minimum of three years of experience providing psychological services within the public school system without supervision. To qualify, a licensee must be able to show proof of their license, credential, or authority to provide unsupervised school psychological services in the jurisdiction where those services were provided, along with documentation from the public school(s) evidencing delivery of those services. (3) Supervisors must sign all educational documents completed for students by the supervisee, including student progress reports, student evaluation reports, or similar professional reports to consumers, other professionals, or other audiences. It is not a violation of this rule if supervisors do not sign documents completed by a committee reflecting the deliberations of an educational meeting for an individual student which the supervisee attended and participated in as part of the legal proceedings required by federal and state education laws, unless the supervisor also attended and participated in such meeting. (4) Supervisors shall document all supervision sessions. This documentation must include information about the duration of sessions, as well as the focus of discussion or training. The documentation must also include information regarding: (A) any contracts or service agreements between the public school district and university school psychology training program; (B) any contracts or service agreements between the public school district and the supervisee; (C) the supervisee's professional liability insurance coverage, if any; (D) any training logs required by the school psychology training program; and (E) the supervisee's trainee or licensure status. (5) Supervisors must ensure that each individual completing any portion of the internship required by Board rule 463.9, is provided with a written agreement that includes a clear statement of the expectations, duties, and responsibilities of each party, including the total hours to be performed by the intern, benefits and support to be provided by the supervisor, and the process by which the intern will be supervised and evaluated. (6) Supervisors must ensure that supervisees have access to a process for addressing serious concerns regarding a supervisee's performance. The process must protect the rights of clients to receive quality services, assure adequate feedback and opportunities for improvement to the supervisee, and ensure due process protection in cases of possible termination of the supervisory relationship. (e) The various parts of this rule should be construed, if possible, so that effect is given to each part. However, where a general provision conflicts with a more specific provision, the specific provision shall control. 40 TexReg 6844 October 2, 2015 Texas Register

Filed with the Office of the Secretary of State on September 16, TRD-201503839 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 465.3 The Texas State Board of Examiners of Psychologists proposes an amendment to 465.3, Providers of Psychological Services. The proposed amendment will prevent duplicate provisions, and assist with the consolidation and clarification of rules related to supervision under Board rule 465.2. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed amendment will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no adverse effect on small businesses or local economies. Comments on the proposed amendment may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The amendment is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 465.3. Providers of Psychological Services. (a) Psychologists shall employ or utilize an individual to provide psychological services, in any setting not specifically exempt under 501.004(a)(1) of the Psychologists' Licensing Act (the Act), only if: (1) The individual is licensed by this Board; or (2) The individual is specifically exempted from licensure requirements by 501.004(a)(2) of the Act, relating to provision of services as part of a supervised course of study by students, residents or interns pursuing a course of study in a recognized training institution or facility; or, (3) The individual is engaged in post-doctoral supervision for purposes of satisfying 501.252(b)(2) of the Act; or (4) The individual is completing supervised experience for purposes of satisfying 501.260(b)(3) of the Act, relating to Licensed Specialist in School Psychology; or (5) The individual is completing supervised experience for purposes of satisfying the requirements to become a licensed professional listed in 501.004(b) of the Act. [(b) Unlicensed individuals providing psychological services pursuant to 501.004(a)(2), 501.252(b)(2), or 501.260(b)(3) of the Act must be under the direct supervision of an authorized supervising licensee at all times. All patients or clients who receive psychological services from an unlicensed individual under such supervision must be clearly informed of the supervisory status of the individual and how the patient or client may contact the supervising licensee directly.] (b) [(c)] Licensees who contract to provide psychological services in settings where the Act does not apply pursuant to 501.004 of the Act ("exempt" settings) are not themselves exempt from the Act. In some cases, a licensee may have to follow state or federal guidelines or laws that conflict with Board rules. In those cases, Board rule 461.14 of this title (relating to Conflict between Laws and Board Rules) applies. (c) [(d)] Licensees who contract with a third party who contracts to provide psychological services in settings where the Act does not apply pursuant to 501.004 of the Act ("exempt" settings) are not themselves exempt from the Act. In some cases, a licensee may have to follow state or federal guidelines or laws that conflict with Board rules. In those cases, Board rule 461.14 of this title applies. Filed with the Office of the Secretary of State on September 16, TRD-201503840 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 465.18 The Texas State Board of Examiners of Psychologists proposes amendments to 465.18, Forensic Services. The proposed amendments are necessary to incorporate the statutory changes enacted with the passage of Tex. H.B. 1449, 84th Leg., R.S. (2015). Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed amendments will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no significant economic costs to persons required to comply with this rule, other than completing the required family violence dynamics training. There will be no adverse effect on small businesses or local economies. Comments on the proposed amendments may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments PROPOSED RULES October 2, 2015 40 TexReg 6845

may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The amendments are proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 465.18. Forensic Services. (a) In General. (1) A licensee who provides services concerning a matter which the licensee knows or should know will be utilized in a legal proceeding, such as a divorce, child custody determination, fitness for duty evaluation for high risk personnel, disability claim, or risk assessment evaluations of employees, must comply with all applicable Board rules concerning forensic services regardless of whether the licensee is acting as a factual witness or an expert. (2) Licensees who engage in forensic services must have demonstrated appropriate knowledge of and competence in all underlying areas of psychology about which they provide such services. (3) All forensic opinions, reports, assessments, and recommendations rendered by a licensee must be based on information and techniques sufficient to provide appropriate substantiation for each finding. (4) A licensee who provides forensic services must comply with all other applicable Board rules and state and federal law relating to the underlying areas of psychology relating to those services. (5) When appointed or designated in writing by a court to provide psychological services, a licensee shall obtain and keep a copy of the court order. (6) When providing forensic psychological services to a minor who is the subject of a court order or the ward of guardianship, a licensee shall obtain and keep a copy of the relevant portions of any court order, divorce decree, or letters of guardianship authorizing the individual to provide substitute consent on behalf of the minor or ward. (b) Limitation on Services. (1) A licensee who is asked to provide an opinion concerning an area or matter about which the licensee does not have the appropriate knowledge and competency to render a professional opinion shall decline to render that opinion. (2) A licensee who is asked to provide an opinion concerning a specific matter for which the licensee lacks sufficient information to render a professional opinion shall decline to render that opinion unless the required information is provided. (3) A licensee shall not render a written or oral opinion about the psychological characteristics of an individual without conducting an examination of the individual unless the opinion contains a statement that the licensee did not conduct an examination of the individual. (4) A written or oral opinion about the psychological characteristics of an individual rendered by a licensee who did not conduct an examination of that individual must contain clarification of the extent to which this limits the reliability and validity of the opinion and the conclusions and recommendations of the licensee. (5) When seeking or receiving court appointment or designation as an expert for a forensic evaluation a licensee specifically avoids accepting appointment or engagement for both evaluation and therapeutic intervention for the same case. A licensee provides services in one but not both capacities in the same case. (c) Describing the Nature of Services. A licensee must document in writing that subject(s) of forensic evaluations or their parents or legal representative have been informed of the following: (1) The nature of the anticipated services (procedures); (2) The specific purpose and scope of the evaluation; (3) The identity of the party who requested the psychologist's services; (4) The identity of the party who will pay the psychologist's fees and if any portion of the fees is to be paid by the subject, the estimated amount of the fees; (5) The type of information sought and the uses for information gathered; (6) The people or entities to whom psychological records will be distributed; (7) The approximate length of time required to produce any reports or written results; (8) Applicable limits on confidentiality and access to psychological records; (9) Whether the psychologist has been or may be engaged to provide testimony based on the report or written results of forensic psychological services in a legal proceeding; and (10) The licensee's name as it appears in their professional file with the Board prior to initiating services. (d) Certain Testimony Prohibited. (1) A licensee may not offer an expert opinion or recommendation relating to the conservatorship of or possession of or access to a child unless the licensee has conducted a child custody evaluation. (2) In a contested suit, a licensee may provide other relevant information and opinions, other than those prohibited by paragraph (1) of this subsection, relating to any party that the licensee has personally evaluated or treated. (3) This subsection does not apply to a suit in which the Department of Family and Protective Services is a party. (e) Child Custody Evaluations. (1) The role of the child custody evaluator is one of professional expert. A licensee serving as a child custody evaluator shall not function as an advocate, but must remain impartial and objective. Licensees conducting child custody evaluations, including those licensees appointed by a court, are subject to the Board's jurisdiction and must follow all applicable Board rules. (2) The term "supervision" as used in this subsection shall have the meaning assigned by Tex. Fam. Code Ann. 107.101. However, the term shall not encompass the restrictions and requirements set forth in Board rule 465.2 of this title (relating to Supervision) nor shall a licensee providing supervision under this subsection have supervisory responsibility under Board rule 465.2 of this title. (3) Minimum Qualifications of Child Custody Evaluator. (A) A licensee must be qualified to conduct a child custody evaluation pursuant to Tex. Fam. Code Ann. 107.104 before the licensee may conduct an evaluation. Licensees qualified to conduct 40 TexReg 6846 October 2, 2015 Texas Register

evaluations under Tex. Fam. Code Ann. 107.104(b)(2) must conduct evaluations under supervision in accordance with that section. (B) Notwithstanding any other grounds for qualification, the Board has determined that a licensed psychologist is qualified to conduct child custody evaluations if the licensee: (i) has obtained a minimum of 8 professional development hours directly related to the performance of child custody evaluations since becoming a licensed psychologist, and is board certified in forensic psychology by the American Board of Professional Psychology (ABPP); or (ii) has obtained a minimum of 40 professional development hours directly related to the performance of child custody evaluations since becoming a licensed psychologist, and has conducted at least three child custody evaluations under the supervision of a qualified licensee. (C) A licensee who does not meet the minimum qualification requirements set forth in Tex. Fam. Code Ann. 107.104, may nevertheless conduct a child custody evaluation if: (i) appointed to do so pursuant to Tex. Fam. Code Ann. 107.106. A licensee appointed under Tex. Fam. Code Ann. 107.106 must comply with the provisions of Subchapter D of the Texas Family Code and this rule; (ii) the individual is licensed as a psychologist, and has completed at least ten social studies or other child custody evaluations ordered by a court in suits affecting the parent-child relationship prior to September 1, 2015; or (iii) the licensee was qualified to conduct a social study evaluation under former Tex. Fam. Code Ann. 107.0511(g). This subpart shall expire on August 31, 2017, at which time it shall have no further force and effect. (D) If requested by a court, a licensee selected to conduct or who is conducting a child custody evaluation must demonstrate appropriate knowledge and competence in child custody evaluation services consistent with professional models, standards, and guidelines. (E) In addition to the minimum qualifications set forth by this rule, an individual must complete at least eight hours of family violence dynamics training provided by a family violence service provider to be qualified to conduct child custody evaluations. (4) Disclosure of Conflicts and Bias. (A) Licensees shall comply with all disclosure requirements set forth in Tex. Fam. Code Ann. 107.107. (B) Following any disclosure required by Tex. Fam. Code Ann. 107.107(c), a licensee must resign as child custody evaluator, unless: (i) the court finds that no conflict of interest exists and that any previous knowledge of a party or child who is the subject of the suit is not relevant; or (ii) the parties and any attorney for a child who is the subject of the suit agree in writing to the licensee's continued appointment as the child custody evaluator. (C) Except as authorized by Tex. Fam. Code Ann. 107.107(f), licensees may not accept appointment as a child custody evaluator if they have worked in a professional capacity with a party, a child who is the subject of the suit, or a member of the party's or child's family. The term "family" as used in this subpart has the meaning assigned by Tex. Fam. Code Ann. 71.003. (5) Elements of Child Custody Evaluation. (A) Licensees shall comply with Tex. Fam. Code Ann. 107.108, 107.109, and 107.1101 when conducting child custody evaluations. (B) Licensees may conduct psychometric testing as part of a child custody evaluation in accordance with Tex. Fam. Code Ann. 107.110. (6) Communications and Recordkeeping of Child Custody Evaluator. (A) Licensees shall comply with the requirements of Tex. Fam. Code Ann. 107.112 regarding: the disclosure of communications between eval- (i) uation participants; (ii) the evaluation; and (iii) the creation and retention of records relevant to access to evaluation records. (B) Licensees conducting child custody evaluations shall maintain the confidentiality of records obtained from the Department of Family and Protective Services pursuant to Tex. Fam. Code Ann. 107.111. Licensees may not disclose any information obtained from the records except as required or allowed by law. Failure to maintain confidentiality as required by Tex. Fam. Code Ann. 107.111 will result in disciplinary action against a licensee. (7) Evaluation Report. (A) A licensee who conducts a child custody evaluation shall prepare and file a report in accordance with Tex. Fam. Code Ann. 107.113. (B) A licensee shall provide a copy of any report filed with the Court in accordance with Tex. Fam. Code Ann. 107.114. (f) Adoption Evaluations. (1) The role of the adoption evaluator is one of professional expert. A licensee serving as an adoption evaluator shall not function as an advocate, but must remain impartial and objective. Licensees conducting adoption evaluations, including those licensees appointed by a court, are subject to the Board's jurisdiction and must follow all applicable Board rules. (2) Minimum Qualifications of Adoption Evaluator. (A) A licensee must be qualified to conduct an adoption evaluation pursuant to Tex. Fam. Code Ann. 107.154 before the licensee may conduct an evaluation. (B) Licensees qualified to conduct a child custody evaluations are also qualified to conduct adoption evaluations. (C) A licensee who does not meet the minimum qualification requirements set forth in Tex. Fam. Code Ann. 107.154, may nevertheless conduct an adoption evaluation if: (i) appointed to do so pursuant to Tex. Fam. Code Ann. 107.155. A licensee appointed under Tex. Fam. Code Ann. 107.155 must comply with the provisions of Subchapter E of the Texas Family Code and this rule; or (ii) the individual is licensed as a psychologist, and has completed at least ten social studies or other child custody evaluations ordered by a court in suits affecting the parent-child relationship prior to September 1, (3) Disclosure of Conflicts and Bias. PROPOSED RULES October 2, 2015 40 TexReg 6847

(A) Licensees shall comply with all disclosure requirements set forth in Tex. Fam. Code Ann. 107.156. (B) Following any disclosure required by Tex. Fam. Code Ann. 107.156(c), a licensee must resign as adoption evaluator, unless: (i) the court finds that no conflict of interest exists and that any previous knowledge of a party or child who is the subject of the suit is not relevant; or (ii) the parties and any attorney for a child who is the subject of the suit agree in writing to the licensee's continued appointment as the adoption evaluator. (C) Except as authorized by Tex. Fam. Code Ann. 107.156(e), licensees may not accept appointment as an adoption evaluator if they have worked in a professional capacity with a party, a child who is the subject of the suit, or a member of the party's or child's family. The term "family" as used in this subpart has the meaning assigned by Tex. Fam. Code Ann. 71.003. (4) A licensee shall report to the Department of Family and Protective Services any adoptive placement that appears to have been made by someone other than a licensed child-placing agency or a child's parent or managing conservator. (5) Licensees shall comply with Tex. Fam. Code Ann. 107.158, 107.159, and 107.160 when conducting adoption evaluations. (6) Licensees conducting adoption evaluations shall maintain the confidentiality of records obtained from the Department of Family and Protective Services pursuant to Tex. Fam. Code Ann. 107.163. Licensees may not disclose any information obtained from the records except as required or allowed by law. Failure to maintain confidentiality as required by Tex. Fam. Code Ann. 107.163 will result in disciplinary action against a licensee. (g) Duty to Report Complaints. Licensees must report any complaint filed against them with this Board that alleges facts tending to show a violation of this rule in connection with a child custody or adoption evaluation. The report must be made to the court that ordered the evaluation within 30 days of receiving notice of the complaint from the Board. Only those complaints for which a licensee receives notice from the Board need to be reported. [(d) Child Custody Evaluations.] [(1) The primary consideration in a child custody evaluation is to assess the individual and family factors that affect the best psychological interests of the child. Other factors or specific factors may also be addressed given a specific forensic services engagement.] [(2) Child custody evaluations generally involve an assessment of the adults' capacity for parenting, an assessment of the psychological functioning, developmental needs, and wishes of the child, and the functional ability of each parent to meet such needs. Other socioeconomic factors, family, collateral and community resources may also be taken into secondary consideration.] [(3) The role of the psychologist in a child custody forensic engagement is one of a professional expert. The psychologist cannot function as an advocate and must retain impartiality and objectivity, regardless of whether retained by the court or a party to the divorce. The psychologist must not perform an evaluation where there has been a prior therapeutic relationship with the child or the child's immediate family members, unless required to do so by court order.] [(4) The scope of the evaluation is determined by the psychologist based on the referral question(s). Licensees must comprehensively perform the evaluation based on the scope of the referral, but not exceed the scope of the referral. [(e) Child Visitation. Forensic opinions as to child visitation and parenting arrangements must be supported by forensic evaluations.] [(1) Licensees may provide treatment or evaluation, but not both in the same case.] [(2) A treating psychologist may express an opinion as to the progress of treatment, but shall refrain from rendering an opinion about child visitation or parenting arrangements, unless required to do so by court order.] [(3) Basis of forensic opinions as to child visitation and parenting access.] [(A) The evaluation must be specific to the issue of visitation or parenting access. A general evaluation of an affected party's psychological condition is insufficient.] [(B) The evaluation must be court ordered, or the psychologist-expert retained specifically to offer such opinion.] [(C) Any evaluation to address the issue of visitation or parenting access must include an evaluation of all affected parties to the proceeding, or identify why a child or affected party was not evaluated, and include a statement as to the limitations on validity imposed thereby.] (h) [(f)] Parenting Facilitators. (1) The title "parenting facilitator" is defined in the Texas Family Code, Title 5, Subtitle B, Chapter 153, Subchapter K, Parenting Plan, Parenting Coordinator, and Parenting Facilitator. (2) The Board's jurisdiction over licensees who also accept engagements as parenting facilitators is limited to its enforcement of Board rules. The Family Code sets forth procedures for the qualifications, duties, appointment and removal, reporting, record retention, and compensation of parenting facilitators. The Family Code also provides procedures for disclosure of conflicts of interest by parenting facilitators. In the event of conflict between the Family Code and Board rules, the Family Code controls, pursuant to Board rule 461.14 of this title (relating to Conflict between Laws and Board Rules). (3) A parenting facilitator who is also a licensed psychologist in Texas is a provider of forensic psychological services and must comply with all other applicable Board rules and state and federal laws relating to the underlying areas of psychology relating to those services. (4) Participants in parenting facilitation are not patients as defined in these rules and in Texas Health and Safety Code 611.001. Records created during parenting facilitation are not confidential. (5) Parenting facilitators must comply with the Texas Family Code at 153.6061 as to duties and 153.6101 as to qualifications, and with the "Guidelines for Parenting Coordination" developed by the Association of Family and Conciliation Courts Task Force on Parenting Coordination, dated May 2005. (6) The following psychologist-parenting facilitator practice standards are set forth consistent with Texas Family Code 153.6101. (A) Parenting facilitators licensed by the Board shall comply with the standard of care applicable to the license to practice psychology in Texas. (B) Psychologist-parenting facilitators meet all requirements of Texas Family Code 153.6101, including active licensure to 40 TexReg 6848 October 2, 2015 Texas Register

practice as a psychologist in Texas; completion of 8 hours of family violence dynamics training provided by a family violence service provider; 40 classroom hours of training in dispute resolution techniques in a course conducted by an alternative dispute resolution system or other dispute resolution organization approved by the court; 24 classroom hours of training in the fields of family dynamics, child development, and family law; and 16 hours of training in the laws governing parenting coordination and parenting facilitation and the multiple styles and procedures used in different models of service. Filed with the Office of the Secretary of State on September 16, TRD-201503841 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 465.38 (Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the Texas State Board of Examiners of Psychologists or in the Texas Register office, James Earl Rudder Building, 1019 Brazos Street, Austin, Texas.) The Texas State Board of Examiners of Psychologists proposes the repeal of 465.38, Psychological Services for Public Schools. The proposed repeal is necessary due to the extensive changes proposed for this rule. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed repeal will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no effect on small businesses or local economies. Comments on the proposed repeal may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Suite 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The repeal is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 465.38. Psychological Services for Public Schools. Filed with the Office of the Secretary of State on September 16, TRD-201503826 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 465.38 The Texas State Board of Examiners of Psychologists proposes new rule 465.38, Psychological Services for Public Schools. The proposed new rule is intended to replace the current version of the rule and reflects a collaborative effort by the Board and its stakeholders to consolidate the rules governing licensure and supervision into a more intuitive format. The proposed new rule also reflects a more singular focus toward the practice standards applicable to LSSPs, rather than co-mingling those standards with licensing and supervision requirements. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed new rule will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no effect on small businesses or local economies. Comments on the proposed new rule may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The new rule is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 465.38. Psychological Services for Public Schools. (a) This rule acknowledges the unique difference in the delivery of school psychological services in the public schools from psychological services in the private sector. The Board recognizes the purview of the State Board of Education and the Texas Education Agency in safeguarding the rights of public school children in Texas. The mandated multidisciplinary team decision making, hierarchy of supervision, regulatory provisions, and past traditions of school psychological service delivery both nationally and in Texas, among other factors, allow for rules of practice in the public schools which reflect these occupational distinctions from the private practice of psychology. (b) Scope of Practice. PROPOSED RULES October 2, 2015 40 TexReg 6849

(1) A Licensed Specialist in School Psychology (LSSP) means a person who is trained to address psychological and behavioral problems manifested in and associated with educational systems by utilizing psychological concepts and methods in programs or actions which attempt to improve the learning, adjustment and behavior of students. Such activities include, but are not limited to, addressing special education eligibility, conducting manifestation determinations, and assisting with the development and implementation of individual educational programs. (2) The assessment of emotional or behavioral disturbance, for educational purposes, using psychological techniques and procedures is considered the practice of psychology. (c) The specialist in school psychology license permits the licensee to provide school psychological services only in Texas public schools, including charter schools. A person utilizing this license may not provide psychological services in any context or capacity outside of their employment or contract with public schools. (d) The correct title for an individual holding a specialist in school psychology license is Licensed Specialist in School Psychology or LSSP. Only individuals who meet the requirements of Board rule 465.6 of this title (relating to Listings, Public Statements and Advertisements, Solicitations, and Specialty Titles) may refer to themselves as School Psychologists. No individual may use the title Licensed School Psychologist. An LSSP who has achieved certification as a Nationally Certified School Psychologist (NCSP) may use this credential along with the license title of LSSP. (e) Schools. Providers of Psychological Services Within the Public (1) School psychological services may be provided in Texas public schools only by individuals authorized by this Board to provide such services. Individuals who may provide such school psychological services include: (A) LSSPs; (B) Those individuals listed in Board rule 463.9(g) of this title (relating to Licensed Specialist in School Psychology); and (C) Individuals seeking to fulfill the licensing requirements of Board rule 463.8 of this title (relating to Licensed Psychological Associate), Board rule 463.10 of this title (relating to Provisionally Licensed Psychologists), or Board rule 463.11 of this title (relating to Licensed Psychologist). (2) Licensees who do not hold the specialist in school psychology license may contract for specific types of psychological services, such as clinical psychology, counseling psychology, neuropsychology, and family therapy. Such contracting must be on a short term or part-time basis, and shall not involve the broad range of school psychological services listed in subsection (b)(1) of this rule. (3) An LSSP who contracts with a school district to provide school psychological services may not subcontract those services which they have been contracted to provide. (f) Compliance with Applicable Education Laws. LSSPs shall comply with all applicable state and federal laws affecting the practice of school psychology, including, but not limited to: (1) Texas Education Code; (2) Family Educational Rights and Privacy Act (FERPA), 20 U.S.C. 1232q; (3) Individuals with Disabilities Education Act (IDEA), 20 U.S.C. 1400 et seq; (4) Texas Public Information Act ("Open Records Act"), Texas Government Code, Chapter 552; (5) Section 504 of the Rehabilitation Act of 1973. Filed with the Office of the Secretary of State on September 16, TRD-201503842 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 CHAPTER 469. COMPLAINTS AND ENFORCEMENT 22 TAC 469.13 The Texas State Board of Examiners of Psychologists proposes an amendment to 469.13, Non-Compliance with Professional Development Requirements. The proposed amendment is necessary to reflect a change in terminology by the Board from "continuing education" to "professional development." Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed amendment will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic cost to persons required to comply with this rule. There will be no adverse effect on small businesses or local economies. Comments on the proposed amendment may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The amendment is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 469.13. Non-Compliance with Professional Development [Continuing Education] Requirements. (a) The license of any licensee who fails to comply with the Board's mandatory professional development requirements pursuant to Board rule 461.11 of this title (relating to Professional Development), is on delinquent status as of the renewal date of the license. (b) If professional development compliance is not proved within 45 days after the license renewal date, the licensee shall be 40 TexReg 6850 October 2, 2015 Texas Register

subject to a complaint for violation of Board rule 461.11(a) of this title applies. (c) A person may not engage in the practice of psychology with a delinquent license, as stated in Board rule 461.7(c) of this title (relating to License Statuses). (d) If the license is not activated within one year of expiration and goes void, a new application must be filed to obtain active licensure, and the professional development complaint will be reinstated. The complaint must be resolved before a new license will be issued. (e) Upon notice of professional development violation, the licensee may: (1) Submit proof that professional development was obtained within the year preceding the renewal date plus the 45-day grace period. Upon receipt and approval, the complaint will be dismissed; (2) For a first violation, submit proof of late compliance and pay an administrative penalty, which is not considered disciplinary action; (3) Resign the license in lieu of adjudication by requesting an agreed order of resignation; or (4) Appear before an informal settlement conference to resolve the matter. (f) Any payment of an administrative penalty to resolve a complaint is in addition to any applicable renewal fee and late renewal fee assessed by the Licensing Division for late license renewal, pursuant to Board rule 473.4 of this title (relating to Late Fees for Renewals (Not Refundable)). Filed with the Office of the Secretary of State on September 16, TRD-201503843 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 CHAPTER 470. ADMINISTRATIVE PROCEDURE 22 TAC 470.13 (Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the Texas State Board of Examiners of Psychologists or in the Texas Register office, James Earl Rudder Building, 1019 Brazos Street, Austin, Texas.) The Texas State Board of Examiners of Psychologists proposes the repeal of 470.13, Entry of Appearance in Contested Case; Contents of Responsive Pleading. The proposed repeal will ensure compliance with Tex. Gov't Code Ann. 2003.050 and 1 TAC 155.3. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed repeal will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no effect on small businesses or local economies. Comments on the proposed repeal may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Suite 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The repeal is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 470.13. Entry of Appearance in Contested Case; Contents of Responsive Pleading. Filed with the Office of the Secretary of State on September 16, TRD-201503827 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 CHAPTER 471. RENEWALS 22 TAC 471.6 (Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the Texas State Board of Examiners of Psychologists or in the Texas Register office, James Earl Rudder Building, 1019 Brazos Street, Austin, Texas.) The Texas State Board of Examiners of Psychologists proposes the repeal of 471.6, Renewal Penalty Waiver for Licensees on Military Deployment. The proposed repeal is necessary due to the extensive changes proposed for this rule. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed repeal will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to PROPOSED RULES October 2, 2015 40 TexReg 6851

comply with this rule. There will be no effect on small businesses or local economies. Comments on the proposed repeal may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Suite 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The repeal is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 471.6. Renewal Penalty Waiver for Licensees on Military Deployment. Filed with the Office of the Secretary of State on September 16, TRD-201503828 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 471.6 The Texas State Board of Examiners of Psychologists proposes new 471.6, Renewal Terms Exclusive to Licensees on Active Military Duty. The new rule will ensure compliance with the changes made to Chapter 55, Occupations Code, by Tex. S.B. 1307, 84th Leg., R.S. (2015). Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed new rule will be in effect, there will be no significant fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no adverse effect on small businesses or local economies. Comments on the proposed new rule may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The new rule is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 471.6. Renewal Terms Exclusive to Licensees on Active Military Duty. (a) Licensees serving on active duty, as defined by Tex. Occ. Code Ann. 55.001, may request a waiver from the professional development requirements and renewal fees associated with the renewal of their license. Licensees who submit a written request to the Board prior to their renewal date each year, and provide the Board with official verification of active duty status during their renewal year, will be granted a waiver from the professional development requirements and renewal fees associated with the renewal of their license for that renewal year. (b) Licensees with an expired or delinquent license may request their license be reinstated or returned to active status if they would have been eligible for a waiver under subsection (a) of this section prior to their license expiring or becoming delinquent. Licensees seeking relief under this paragraph must do so within two years of their license becoming delinquent. Filed with the Office of the Secretary of State on September 18, TRD-201503844 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 CHAPTER 473. FEES 22 TAC 473.1 The Texas State Board of Examiners of Psychologists proposes an amendment to 473.1, Application Fees (Non Refundable). The amendment is necessary to comply with the changes made to Ch. 55, Occupations Code, by Tex. S.B. 807, 84th Leg., R.S. (2015). Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed amendment will be in effect, there will be no significant fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic cost to persons required to comply with this rule. There will be no adverse effect on small businesses or local economies. Comments on the proposed amendment may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. 40 TexReg 6852 October 2, 2015 Texas Register

The amendment is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 473.1. Application Fees (Non Refundable). (a) Generally Applicable Application Fees: (1) Psychological Associate Licensure--$190 (2) Provisionally Licensed Psychologist--$340 (3) Licensure--$180 (4) Reciprocity--$480 (5) Licensed Specialist in School Psychology--$220 (b) All license application fees payable to the Board are waived for the following individuals: (1) military service members and military veterans, as those terms are defined by Chapter 55, Occupations Code, whose military service, training, or education substantially meets all of the requirements for licensure; and (2) military service members, military veterans, and military spouses, as those terms are defined by Chapter 55, Occupations Code, who hold a current license issued by another jurisdiction that has licensing requirements that are substantially equivalent to the requirements of this state. [(b) Application Fees for Applicants Receiving Credit for Verified Military Experience Under Board rule 463.30(b) of this title (relating to Licensing of Military Spouses and Applicants with Military Experience):] [(1) Psychological Associate Licensure--$145] [(2) Provisionally Licensed Psychologists--$305] [(3) Licensure--$155] [(4) Licensed Specialist in School Psychology--$185] Filed with the Office of the Secretary of State on September 16, TRD-201503845 Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 22 TAC 473.2 The Texas State Board of Examiners of Psychologists proposes amendments to 473.2, Examination Fees. The amendments are necessary to comply with the changes made to Ch. 55, Occupations Code, by Tex. S.B. 807, 84th Leg., R.S. (2015), and the upcoming implementation of the online version of the Board's Jurisprudence Examination. Darrel D. Spinks, Executive Director, has determined that for the first five-year period the proposed amendment will be in effect, there will be no significant fiscal implications for state or local governments as a result of enforcing or administering the rule. Mr. Spinks has also determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to help the Board protect the public. There will be no economic costs to persons required to comply with this rule. There will be no adverse effect on small businesses or local economies. Comments on the proposed amendment may be submitted to Brenda Skiff, Texas State Board of Examiners of Psychologists, 333 Guadalupe, Ste 2-450, Austin, Texas 78701 within 30 days of publication of this proposal in the Texas Register. Comments may also be submitted via fax to (512) 305-7701 or via email to brenda@tsbep.texas.gov. The amendment is proposed under Texas Occupations Code, Title 3, Subtitle I, Chapter 501, which provides the Texas State Board of Examiners of Psychologists with the authority to make all rules, not inconsistent with the Constitution and Laws of this State, which are reasonably necessary for the proper performance of its duties and regulations of proceedings before it. No other code, articles or statutes are affected by this section. 473.2. Examination Fees (Non-refundable). (a) Generally Applicable Examination Fees: [The following examination fees are non-refundable.] (1) Examination for the Professional Practice of Psychology--$600 (2) Jurisprudence Examination--$200. This fee shall increase to $234 following implementation of the online version of the Jurisprudence Examination, with $200 being attributable to the Board and $34 being attributable to the third-party vendor administering the examination.[:] [(A) --$210 through August 31, 2014] [(B) --$200 effective September 1, 2014] (3) Oral Examination--$320 (b) The fee for the Oral Examination, as well as that portion of the Jurisprudence Examination fee attributable to the Board, shall be waived for the following individuals: (1) military service members and military veterans, as those terms are defined by Chapter 55, Occupations Code, whose military service, training, or education substantially meets all of the requirements for licensure; and (2) military service members, military veterans, and military spouses, as those terms are defined by Chapter 55, Occupations Code, who hold a current license issued by another jurisdiction that has licensing requirements that are substantially equivalent to the requirements of this state. Filed with the Office of the Secretary of State on September 16, TRD-201503846 PROPOSED RULES October 2, 2015 40 TexReg 6853

Darrel D. Spinks Executive Director Texas State Board of Examiners of Psychologists For further information, please call: (512) 305-7700 PART 22. TEXAS STATE BOARD OF PUBLIC ACCOUNTANCY CHAPTER 527. PEER REVIEW 22 TAC 527.4 The Texas State Board of Public Accountancy (Board) proposes an amendment to 527.4, concerning Enrollment and Participation. Background, Justification and Summary The amendment to 527.4 will track the American Institute of CPAs issuance of SSARS 21, regarding compilations and preparation engagements, requiring reports with all compilations to become effective December 15, Fiscal Note William Treacy, Executive Director of the Board, has determined that for the first five-year period the proposed amendment is in effect, there will be no additional estimated cost to the state, no estimated reduction in costs to the state and to local governments, and no estimated loss or increase in revenue to the state, as a result of enforcing or administering the amendment. Public Benefit Cost Note Mr. Treacy has determined that for the first five-year period the amendment is in effect the public benefits expected as a result of adoption of the proposed amendment will be an understanding that a report must be issued with all compilations. There will be no probable economic cost to persons required to comply with the amendment and a Local Employment Impact Statement is not required because the proposed amendment will not affect a local economy. Small Business and Micro-Business Impact Analysis Mr. Treacy has determined that the proposed amendment will not have an adverse economic effect on small businesses or micro-businesses because the amendment does not impose any duties or obligations upon small businesses or micro-businesses, therefore, an Economic Impact Statement and a Regulatory Flexibility Analysis is not required. Public Comment Written comments may be submitted to J. Randel (Jerry) Hill, General Counsel, Texas State Board of Public Accountancy, 333 Guadalupe, Tower 3, Suite 900, Austin, Texas 78701 or faxed to his attention at (512) 305-7854 no later than noon on November 2, The Board specifically invites comments from the public on the issues of whether or not the proposed amendment will have an adverse economic effect on small businesses; if the proposed rule is believed to have an adverse effect on small businesses, estimate the number of small businesses believed to be impacted by the rule, describe and estimate the economic impact of the rule on small businesses, offer alternative methods of achieving the purpose of the rule; then explain how the Board may legally and feasibly reduce that adverse effect on small businesses considering the purpose of the statute under which the proposed rule is to be adopted, finally describe how the health, safety, environmental and economic welfare of the state will be impacted by the various proposed methods. See Texas Government Code, 2006.002(c). Statutory Authority The amendment is proposed under the Public Accountancy Act ("Act"), Texas Occupations Code, 901.151 which authorizes the Board to adopt rules deemed necessary or advisable to effectuate the Act. No other article, statute or code is affected by this proposed amendment. 527.4. Enrollment and Participation. (a) Participation in the program is required of each firm licensed or registered with the board that performs any attest service or any accounting and/or auditing engagements, including audits, reviews, compilations, forecasts, projections, or special reports as defined in 901.002 of the Act (relating to General Definitions) and 501.52(4), (11) and (23) of this title (relating to Definitions). A firm which [issues only compilations where no report is required or] only performs preparation engagements under SSARS is not required to participate in the program. (b) A firm that does not perform services as set out in subsection (a) of this section shall annually submit a request for the exemption in writing to the board with an explanation of the services offered by the firm. A firm which begins providing services as set out in subsection (a) of this section shall notify the board of the change in status within 30 days of the change in status, provide the board with enrollment information within 90 days of the date the services were first provided and have a peer review performed within 18 months of the date the services were first provided. (c) Each firm required to participate under subsection (a) of this section shall enroll in the applicable programs of an approved sponsoring organization within 12 months from its initial licensing date or the performance of services that require a review. The firm shall adopt the review due date assigned by the sponsoring organization, and must notify the board of the peer review due date within 30 days of its assignment. In addition, the firm shall schedule and begin an additional review within three years of the previous review's due date, or earlier as may be required by the sponsoring organization or a committee of the board. It is the responsibility of the firm to anticipate its needs for review services in sufficient time to enable the reviewer to complete the review by the assigned review due date. (d) In the event that a firm is merged, otherwise combined, dissolved, or separated, the sponsoring organization shall determine which firm is considered the succeeding firm. The succeeding firm shall retain its peer review status and the review due date. (e) The board will accept extensions granted by the sponsoring organization to complete a review, provided the board is notified by the firm within 20 days of the date that an extension is granted. (f) A firm that has been rejected by a sponsoring organization for any reason must make a request in writing to the board for authorization to enroll in a program of another sponsoring organization. (g) A firm choosing to change to another sponsoring organization may do so provided that the firm authorizes the previous sponsoring organization to communicate to the succeeding sponsoring organization any outstanding corrective actions related to the firm's most 40 TexReg 6854 October 2, 2015 Texas Register

recent review. Any outstanding actions must be cleared and outstanding fees paid prior to transfer between sponsoring organizations. (h) An out-of-state firm practicing in this state pursuant to a practice privilege provided for in 901.461 of the Act (relating to Practice by Certain Out-of-State Firms) and 517.1 and 517.2 of this title (relating to Practice by Certain Out of State Firms and Practice by Certain Out of State Individuals) of these regulations must comply with the peer review program of the state in which the firm is licensed. (i) An out-of-state firm practicing in this state pursuant to a practice privilege from a state without a peer review program must comply with 901.159 of the Act (relating to Peer Review) and Chapter 517 of this title (relating to Practice by Certain Out-of-State Firms and Individuals). (j) An out-of-state firm practicing in this state pursuant to a practice privilege must submit its peer review (or equivalent) documentation upon request of the board. (k) Interpretive Comment. If a firm is subject to inspections pursuant to PCAOB and also performs attest work not subject to such inspections, the firm must enroll in a peer review program for review of its non-public company attest work in addition to the firm inspection program required by the PCAOB. Filed with the Office of the Secretary of State on September 17, TRD-201503886 J. Randel (Jerry) Hill General Counsel Texas State Board of Public Accountancy For further information, please call: (512) 305-7842 TITLE 31. NATURAL RESOURCES AND CONSERVATION PART 2. TEXAS PARKS AND WILDLIFE DEPARTMENT CHAPTER 53. FINANCE SUBCHAPTER A. FEES DIVISION 1. LICENSE, PERMIT, AND BOAT AND MOTOR FEES 31 TAC 53.3 The Texas Parks and Wildlife Department proposes an amendment to 53.3, concerning Combination Hunting and Fishing License Packages. Under Parks and Wildlife Code, 42.012, the Texas Parks and Wildlife Commission (commission) is required to waive the hunting license fee for a qualified disabled veteran, defined as "a veteran with a service connected disability, as defined by the Veterans Administration, consisting of the loss of the use of a lower extremity or of a disability rating of 50 percent or more and who is receiving compensation from the Unites States for the disability." Under Parks and Wildlife Code, 46.004, the commission is required to waive fishing license fees for a qualified disabled veteran as defined by Parks and Wildlife Code, 42.012. Under Parks and Wildlife Code, 50.001, the commission is required to establish fees for combination hunting and fishing licenses. The proposed amendment would remove the current language describing the exact nature of the disability that qualifies a person to obtain a disabled veterans license and replaces it with a reference to the statute in which the standard is articulated. House Bill 721, enacted by the most recent session of the legislature, altered the statutory definition to decrease the minimum disability rating (from 60 percent to 50 percent) required to qualify to obtain a disabled veteran's license. Rather than amend the current rule to update the definition, the proposed amendment would cite the statutory reference. House Bill 721 also replaced the outdated term "Veteran's Administration" with the updated name of that agency, the United States Department of Veterans Affairs." Justin Halvorsen, Revenue Director, has determined that for each of the first five years that the rule as proposed is in effect, there will be no fiscal implications to state or local governments as a result of enforcing or administering the rule. Mr. Halvorsen also has determined that for each of the first five years the rule as proposed is in effect, the public benefit anticipated as a result of enforcing or administering the rule as proposed will be accurate regulations. There will be no adverse economic effect on persons required to comply with the rule as proposed. Under the provisions of Government Code, Chapter 2006, a state agency must prepare an economic impact statement and a regulatory flexibility analysis for a rule that may have an adverse economic effect on small businesses and micro-businesses. As required by Government Code, 2006.002(g), the Office of the Attorney General has prepared guidelines to assist state agencies in determining a proposed rule's potential adverse economic impact on small businesses. Those guidelines state that an agency need only consider a proposed rule's "direct adverse economic impacts" to small businesses and micro-businesses to determine if any further analysis is required. For that purpose, the department considers "direct economic impact" to mean a requirement that would directly impose recordkeeping or reporting requirements; impose taxes or fees; result in lost sales or profits; adversely affect market competition; or require the purchase or modification of equipment or services. The department has determined that there will be no adverse economic effects on small businesses or microbusinesses because the proposed rule will not directly affect small businesses or micro-businesses. Therefore, the department has not prepared the economic impact statement or regulatory flexibility analysis described in Government Code, Chapter 2006. The department has not drafted a local employment impact statement under the Administrative Procedure Act, Government Code, 2001.022, as the agency has determined that the rule as proposed will not impact local economies. The department has determined that there will not be a taking of private real property, as defined by Government Code, Chapter 2007, as a result of the proposed rule. Comments on the proposed rule may be submitted to Justin Halvorsen, Texas Parks and Wildlife Department 4200 Smith School Road, Austin, Texas 78744; (512) 389-8551 (e-mail: PROPOSED RULES October 2, 2015 40 TexReg 6855

justin.halvorsen@tpwd.texas.gov) or via the department website at http://tpwd.texas.gov/business/feedback/public_comment/. The amendment is proposed under the authority House Bill 721, 84th Texas Legislature, 2015, Regular Session, which amended Parks and Wildlife Code, 42.012, to provide that a qualified disabled veteran is a veteran with a service connected disability, as defined by the United States Department of Veterans Affairs, consisting of the loss of the use of a lower extremity or of a disability rating of 50 percent or more and who is receiving compensation from the United States for the disability; 46.004, which requires the commission to waive fishing license fees for a qualified disabled veteran as defined by Parks and Wildlife Code, 42.012; and 50.001, which requires the commission to establish fees for combination hunting and fishing licenses. The proposed amendment affects Parks and Wildlife Code, Chapters 42, 46, and 50. 53.3. Combination Hunting and Fishing License Packages. (a) (No change.) (b) For purposes of this section, a "disabled veteran" is a veteran meeting the requirements of Parks and Wildlife Code, 42.012(c). [with a service connected disability, as defined by the Veterans' Administration, consisting of the loss of the use of a lower extremity or of a disability rating of 60 percent or more and who is receiving compensation of the United States for the disability.] Filed with the Office of the Secretary of State on September 21, TRD-201503929 Ann Bright General Counsel Texas Parks and Wildlife Department For further information, please call: (512) 389-4775 CHAPTER 65. WILDLIFE SUBCHAPTER B. DISEASE DETECTION AND RESPONSE DIVISION 2. CHRONIC WASTING DISEASE - MOVEMENT OF BREEDER DEER 31 TAC 65.90-65.93 The Texas Parks and Wildlife Department proposes new 65.90-65.93, concerning Disease Detection and Response. The proposed new rules will be constituted as new Division 2 within Chapter 65, Subchapter B, entitled Chronic Wasting Disease - Movement of Breeder Deer. The department wishes to emphasize that the proposed new rules, if adopted, would be an interim replacement for the current emergency rules adopted on August 18, 2015 and published in the September 4, 2015, issue of the Texas Register (40 TexReg 5566) ("emergency CWD rules"), which is necessary in order to maintain regulatory continuity for the duration of the 2015-2016 deer season and the period immediately thereafter. Based on additional information from the ongoing epidemiological investigation, disease surveillance data collected from captive and free ranging deer herds, guidance from the Texas Animal Health Commission, and input from stakeholder groups, the department intends to review the interim rules following the close of the deer season and present the results of that review to the Parks and Wildlife Commission (Commission) in the spring of 2016 for possible modifications. Under Parks and Wildlife Code, Chapter 43, Subchapter L, the department regulates the possession of captive-raised deer within a facility for breeding purposes and the release of such deer into the wild. A deer breeder permit affords deer breeders certain privileges, such as (among other things) the authority to buy, sell, transfer, lease, and release captive-bred white-tailed and mule deer, subject to the regulations of the Commission and the conditions of the permit. Breeder deer may be purchased, sold, transferred, leased, or received only for purposes of propagation or liberation. There are currently 1,275 permitted deer breeders (operating more than 1,300 deer breeding facilities) in Texas. Discovery of CWD On June 30, 2015, the department received confirmation that a two-year-old white-tailed deer held in a deer breeding facility in Medina County ("index facility") had tested positive for chronic wasting disease (CWD). Under the provisions of the Agriculture Code, 161.101(a)(6) CWD is a reportable disease. A veterinarian, veterinary diagnostic laboratory, or person having care, custody, or control of an animal is required to report the existence of CWD to TAHC within 24 hours after diagnosis. Subsequent testing confirmed the presence of CWD in additional white-tailed deer at the index facility. The source of the CWD at the index facility is unknown at this time. Within the last five years, the index facility accepted deer from 30 other Texas deer breeders and transferred 835 deer to 147 separate sites (including 96 deer breeding facilities, 46 release sites, and two Deer Management Permit (DMP) facilities in Texas, as well as two destinations in Mexico). (A DMP is a permit issued by the department under rules adopted pursuant to Parks and Wildlife Code, Chapter 43, Subchapters R and R-1, that allows the temporary possession of free-ranging white-tailed or mule deer for breeding purposes.) The department estimates that more than 728 locations in Texas (including 384 deer breeders) either received deer from the index facility or received deer from a deer breeder who had received deer from the index facility. At least one of those locations, a deer breeding facility in Lavaca County, was recently confirmed to have a CWD positive white-tailed deer acquired from the index facility. The proposed new rules impose CWD testing requirements and movement restrictions for white-tailed deer and mule deer held under the authority of deer breeder permits issued by the department. The new rules are a result of extensive cooperation between the department and the Texas Animal Health Commission (TAHC) to protect susceptible species of exotic and native wildlife from CWD. TAHC is the state agency authorized to manage "any disease or agent of transmission for any disease that affects livestock, exotic livestock, domestic fowl, or exotic fowl, regardless of whether the disease is communicable, even if the agent of transmission is an animal species that is not subject to the jurisdiction" of TAHC. Tex. Agric. Code 161.041(b). Background Regarding CWD CWD is a fatal neurodegenerative disorder that affects some cervid species, including white-tailed deer, mule deer, elk, red deer, sika, and their hybrids (susceptible species). It is clas- 40 TexReg 6856 October 2, 2015 Texas Register

sified as a TSE (transmissible spongiform encephalopathy), a family of diseases that includes scrapie (found in sheep), bovine spongiform encephalopathy (BSE, found in cattle), and variant Creutzfeldt-Jakob Disease (vcjd) in humans. Currently, the only test certified by the U.S. Department of Agriculture (USDA) for CWD must be conducted post-mortem by extracting and testing the obex (a structure in the brain) or medial retropharyngeal lymph node, although the department is actively collaborating with researchers to investigate possible efficacious live-animal tests that can be integrated into the state's overall disease surveillance efforts. Much remains unknown about CWD. The peculiarities of its transmission (how it is passed from animal to animal), infection rate (the frequency of occurrence through time or other comparative standard), incubation period (the time from exposure to clinical manifestation), and potential for transmission to other species are still being investigated. There is no scientific evidence to indicate that CWD is transmissible to humans. What is known is that CWD is invariably fatal to cervids, and is transmitted both directly (through deer-to-deer contact) and indirectly (through environmental contamination). Moreover, a high prevalence of the disease correlates with deer population decline in at least one free-ranging population, and there is evidence that hunters tend to avoid areas of high CWD prevalence. Additionally, the apparent persistence of CWD in contaminated environments represents a significant obstacle to eradication of CWD from either farmed or free-ranging cervid populations. The potential implications of CWD for Texas and its annual, multi-billion dollar ranching, hunting, real estate, tourism, and wildlife management-related economies could be significant, unless it is contained and controlled. Previous CWD Rulemaking The department has engaged in several rulemakings over the years to address the threat posed by CWD. In 2005, the department closed the Texas border to the entry of out-of-state captive white-tailed and mule deer and increased regulatory requirements regarding disease monitoring and record keeping. (The closing of the Texas border to entry of out-of-state captive white-tailed and mule deer was updated, effective in January 2010, to address other disease threats to white-tailed and mule deer (35 TexReg 252).) On July 10, 2012, the department confirmed that two mule deer sampled in the Texas portion of the Hueco Mountains tested positive for CWD. In response, the department and TAHC convened the CWD Task Force, comprised of wildlife-health professionals and cervid producers, to advise the department on the appropriate measures to be taken to protect white-tailed and mule deer in Texas. Based on recommendations from the CWD Task Force, the department adopted new rules in 2013 (37 TexReg 10231) to implement a CWD containment strategy in far West Texas. The rules (31 TAC 65.80-65.88), among other things, require deer harvested in a specific geographical area (the Containment Zone), to be presented at check stations to be tested for CWD. The department has been concerned for over a decade about the possible emergence of CWD in free-ranging and captive deer populations in Texas. Since 2002, more than 32,882 "not detected" CWD test results were obtained from free-ranging (i.e., not breeder) deer in Texas, and deer breeders have submitted 12,759 "not detected" test results as well. The intent of the proposed new rules is to reduce the probability of CWD being spread from facilities where it might exist and to increase the probability of detecting and containing CWD if it does exist. Overview of Proposed Rules The proposed new rules therefore set forth specific CWD testing requirements for deer breeders, which would have to be satisfied in order to transfer deer to other deer breeders (or other captivedeer facilities), or for purposes of release. The new rules also impose CWD testing requirements on sites where breeder deer are liberated (release sites). One of the most effective approaches to managing infectious diseases and arresting the spread of a disease is to segregate suspicious individuals and populations from unexposed populations. As a matter of epidemiological probability, when animals from a population at higher risk of harboring an infectious disease are introduced to a population of animals at a lower risk of harboring an infectious disease, the confidence that the receiving population will remain disease-free is reduced. Therefore, in establishing testing and other requirements, the proposed rules classify breeding facilities and release sites based on the epidemiological likelihood that the breeder facility or release site will contain or spread CWD. In other words, the classifications are based on the relative level of risk for CWD associated with the breeding facility or release site. Breeding facilities are classified as Transfer Category 1 (TC 1), Transfer Category 2 (TC 2) or Transfer Category 3 (TC 3). TC 1 breeding facilities are facilities that are have a low risk for CWD and TC 3 facilities are facilities that have a higher risk for CWD. TC 1 facilities are considered the highest status breeding facilities under the proposed rules. Similarly, release sites are classified as a Class I, Class II or Class III release site. As with breeding facilities, a Class I release site poses less risk and a Class III site poses more risk. Class I release sites are considered the highest status release sites. One factor in determining relative risk concerns a breeding facility's participation in TAHC's CWD Herd Certification Program. See 4 TAC 40.3 (relating to Herd Status Plans for Cervidae). Participation in the TAHC CWD Herd Certification Program requires that breeding facilities comply with more stringent CWD testing, monitoring, and other requirements. Breeding facilities that have complied with the testing, monitoring, and other requirements of this program for five years or more are considered to be at the lowest risk for CWD. In evaluating risk, the department determined that these so-called "certified" or "fifth-year" breeding facilities pose the lowest level of risk. Another factor in evaluating risk is the relationship of a breeding facility or release site to a breeding facility at which CWD has been detected. As described in more detail below, those facilities and sites which are most closely related to the CWD-positive facility are referred to as "Tier 1" facilities. Another significant component of the proposed new rules is the requirement that breeder deer may be released (liberated) only on release sites that are surrounded by a fence of at least seven feet in height and that is capable of retaining deer at all times. Because deer held under deer breeder permits are frequently liberated for stocking and/or hunting purposes (27,684 in 2014), the potential for disease transmission from liberated breeder deer to free-ranging deer is of concern, given that the source of CWD in the index facility is currently unknown and the large number of deer that have been moved to other breeding facilities and/or released to the wild. The proposed new rules are necessary to protect the state's white-tailed and mule deer populations, as well as the long term viability of associated hunting, wildlife management, and deer PROPOSED RULES October 2, 2015 40 TexReg 6857

breeding industries. To minimize the severity of biological and economic impacts resulting from CWD, the proposed new rules implement a more rigorous testing protocol within certain deer breeding facilities and at certain release sites than was previously required. The proposed new rules allow all deer breeders, except a CWD-positive facility, the opportunity to continue to move and release breeder deer in an effort to balance the needs of the many and varied landowner, management, and deer hunting interests in the state. Changes from Emergency Rules The proposed new rules differ from the emergency CWD rules in several ways. Although the following is not a comprehensive listing, to assist persons wishing to comment on the proposed new rules, the following provides information about areas in which the proposed rules differ from the emergency rules. Substantive Changes from Emergency Rules 1. Section 65.91(e) of the emergency rules provides that if a breeding facility or release site accepts breeder deer from a facility of lower status, then the receiving facility assumes that lower status for the purpose of the rules. Although the emergency rules provide a mechanism for Transfer Category (TC) 2 status to be re-established for facilities that have dropped to TC 3 status, the emergency rules do not specify a timeframe for such a transition. Therefore, proposed new 65.91(f) stipulates that a facility that has dropped in status may increase in status, either in two years (TC 3 to TC 2) or in five (TC 2 to TC 1). 2. Similarly, the emergency rules do not specifically address the status of new facilities permitted after March 31, In the same vein, the emergency rules do not explicitly state that it is possible for TC 2 facilities to become TC 1 facilities (although it would be automatic if "5th year" or "certified" status under the Texas Animal Health Commission (TAHC) Herd Certification Program is attained). Therefore, proposed new 65.92(a)(4) would contain clarifying language to the effect that facilities permitted after March 31, 2015 would assume the status of the lowest status of deer accepted. 3. Section 65.93(b)(3)(A) of the emergency rules did not note that a release site is a Class III release site if it is a Tier 1 facility. Proposed new 65.93(b)(3)(B)(i) remedies that oversight. Clarifying and Other Changes from Emergency Rules 1. The emergency rules did not contain a definition of "confirmed" as it relates to CWD testing. In reviewing the emergency rule for the preparation of this proposal, the department determined that a definition of "confirmed" would be helpful to avoid confusion. Therefore, proposed new 65.90(3) defines the term as "a CWD test result of "positive" received from the National Veterinary Service Laboratories of the United States Department of Agriculture." 2. The definition of "exposed" contained at 65.90(9) of the emergency rules did not contemplate situations in which the department is able to determine that although a deer might otherwise be considered an "exposed" to CWD, the department is able, through an epidemiological investigation to determine that a deer is, in fact, not exposed. For example, if a deer was transferred out of a breeding facility prior to a CWD-positive deer being transferred into the facility, the department may be able to determine that the deer transferred out of the facility was not exposed to CWD. The ability to determine that a deer is not, in fact, an exposed deer is important because a facility that accepts an exposed deer becomes a "Tier 1" facility, triggering provisions that not only affect that facility, but all the facilities that received deer from the facility. Therefore, the definition of "exposed" in proposed new 65.90(10) has been altered to allow the department to truncate the trace-back of deer movements in a facility in cases where an epidemiological investigation reveals the trace-back is not necessary. 3. The definition of "Tier 1" contained at 65.90(20) of the emergency rules did not contemplate situations in which a facility that received exposed deer might be able to satisfy testing requirements to become eligible to move deer, but would still be prohibited from doing so by being subject to a TAHC hold order. Therefore, proposed new 65.90(21) has been altered to stipulate that a Tier 1 facility remains a Tier 1 facility if it is under a TAHC hold order. 4. Section 65.91(h) of the emergency rules provided that a person who is subject to the provisions of the emergency rules is required to comply with the provisions of TAHC regulations at 4 TAC Chapter 40 (relating to Chronic Wasting Disease) that are applicable to white-tailed or mule deer. As worded, the provision inadvertently excludes deer released prior the effective date of the emergency rules, because such deer have been liberated and are not possessed under the provisions of the rules. Therefore, proposed new 65.92(i) has been reworded to apply also to persons who receive deer for liberation. 5. Proposed new 65.93(a)(5) would provide that if the owner of a release site does not comply with the CWD testing requirements the release site would be ineligible to be a destination for future releases. The emergency rules and included a five-year timeframe for ineligibility. The five-year time frame for ineligibility is not included in the proposed new rules. 6. The emergency rules contained specific dates necessary to accommodate the immediate application of the emergency provisions. The proposed new rules eliminate those dates where necessary and replace them with generic language. Definitions Proposed new 65.90, concerning Definitions, would set forth the meanings of specialized words and terms in order to eliminate ambiguity and enhance compliance and enforcement. Proposed new 65.90(1) would define "accredited testing facility" as "a laboratory approved by the United States Department of Agriculture to test white-tailed deer or mule deer for CWD." The definition is necessary in order to provide a standard for testing facilities. Proposed new 65.90(2) would define "breeder deer" as "a white-tailed deer or mule deer possessed under a permit issued by the department pursuant to Parks and Wildlife Code, Chapter 43, Subchapter L, and Subchapter T of this chapter." The definition is necessary to establish a shorthand term for a phrase that is used frequently in the proposed new rules but cumbersome to repeat. Proposed new 65.90(3) would define "confirmed" as "a CWD test result of "positive" received from the National Veterinary Service Laboratories (NVSL) of the United States Department of Agriculture." The definition is necessary in order to provide a definitive standard for asserting the presence of CWD in a sample. Samples collected from breeder deer are sent initially to an accredited testing facility, such as the Texas Veterinary Medical Diagnostic Laboratory (TVMDL). A test result of "suspect" is returned when CWD is detected, and a tissue sample is forwarded to the NVSL for confirmation. 40 TexReg 6858 October 2, 2015 Texas Register

Proposed new 65.90(4) would define "CWD" as "chronic wasting disease." The definition is necessary to provide an acronym for a term that is used repeatedly in the rules. Proposed new 65.90(5) would define "CWD-positive facility" as "a facility where CWD has been confirmed." The definition is necessary because the proposed new rules contain provisions that are predicated on whether or not CWD has been detected and confirmed in a given deer breeding, DMP, nursing, or other facility authorized to possess white-tailed deer or mule deer. Proposed new 65.90(6) would define "deer breeder" as "a person who holds a valid deer breeder's permit issued pursuant to Parks and Wildlife Code, Chapter 43, Subchapter L, and Subchapter T of this chapter." As with several other definitions in the proposed new rules, the definition is necessary to establish a shorthand term for a phrase that is used frequently in the proposed new rules but cumbersome to repeat. Proposed new 65.90(7) would define "deer breeding facility (breeding facility)" as "a facility permitted to hold breeder deer under a permit issued by the department pursuant to Parks and Wildlife Code, Chapter 43, Subchapter L, and Subchapter T of this chapter." As with several other definitions in the proposed new rules, the definition is necessary to establish a shorthand term for a phrase that is used frequently in the proposed new rules but cumbersome to repeat. Proposed new 65.90(8) would define "department (department)" as "Texas Parks and Wildlife Department." The definition is necessary to avoid confusion, since the proposed new rules contain references to another state agency. Proposed new 65.90(9) would define "eligible mortality" as "a breeder deer that has died within a deer breeding facility and is 16 months of age or older, or, if the deer breeding facility is enrolled in the TAHC CWD Herd Certification Program, is 12 months of age or older." The definition is necessary, in part, because the proposed rules require CWD testing of eligible mortalities. CWD is difficult to detect in deer younger than 12 months of age. The department's previous CWD testing rules at 65.604 (e) of this title provided for testing of mortalities that were 16 months or older. The department is retaining that standard but is also recognizing that the TAHC and USDA use a standard of 12 months. Proposed new 65.90(10) would define "exposed deer." This definition would provide that "unless the department determines through an epidemiological investigation that a specific breeder deer has not been exposed to CWD, an exposed deer is a whitetailed deer or mule deer that is in a CWD-positive facility or was in a CWD-positive facility within the five years preceding the confirmation of CWD in that facility." The definition is necessary to distinguish the circumstances under which certain provisions of the proposed new rules are applicable. The five-year timeframe was selected because a deer infected with CWD could shed prions (the infectious agent believed to cause CWD) and infect other animals during this period before exhibiting clinical symptoms of the disease. However, if an epidemiological investigation concludes that any part of the five-year window is unnecessary, the status of "exposed" could be altered. Proposed new 65.90(11) would define "hunter-harvested deer" as "a deer required to be tagged under the provisions of Subchapter A of this chapter (relating to Statewide Hunting Proclamation)." The definition is necessary because the proposed rules in some instances require deer harvested by hunters (as opposed to other types of mortality) to be tested for CWD. Proposed new 65.90(12) would define "landowner (owner)" as "any person who has an ownership interest in a tract of land, and includes a landowner's authorized agent." The definition is necessary because the proposed new rules set forth testing requirements and other obligations for persons who own land where breeder deer are released. Proposed new 65.90(13) would define "landowner's authorized agent" as "a person designated by a landowner to act on the landowner's behalf." The definition is necessary for the same reason set forth in the discussion of proposed new 65.90(12). Proposed new 65.90(14) would define "NUES tag" as "an ear tag approved by the United States Department of Agriculture for use in the National Uniform Eartagging System (NUES)." The definition is necessary because the proposed new rules require breeder deer released to the wild to be tagged with either a RFID or NUES tag. Proposed new 65.90(15) would define "originating facility" as "a facility that is the source facility identified on a transfer permit." The definition is necessary because the proposed new rules allow breeder deer to be transferred between deer breeders, making it necessary to distinguish one from the other. Proposed new 65.90(16) would define "reconciled herd" as "the deer held in a breeding facility for which the department has determined that the deer breeder has accurately reported every birth, mortality, and transfer of deer in the previous reporting year." The definition is necessary because the proposed rules require a deer breeder to have a reconciled herd in order to transfer or release breeder deer. Proposed new 65.90(17) would define "release site" as "a specific tract of land that has been approved by the department for the release of breeder deer under this division." The definition is necessary because the proposed new rules impose CWD testing requirements for tracts of land where breeder deer are liberated if the breeder deer originate from certain types of deer breeder facilities. Proposed new 65.90(18) would define "reporting year" as "the period of time from April 1 of one calendar year to March 31 of the next calendar year." Deer breeders are required to file annual reports with the department. The proposed new rules condition the eligibility of deer breeders to transfer and release deer on the completeness and accuracy of those reports. Proposed new 65.90(19) would define "RFID tag" as "a button-type ear tag conforming to the 840 standards of the United States Department of Agriculture's Animal Identification Number system." The definition is necessary because the proposed new rules require breeder deer released to the wild to be tagged with either an RFID or NUES tag. Proposed new 65.90(20) would define "status" as "the level of testing required by this division for any given deer breeding facility or release site." The definition also clarifies that the highest status for a Transfer Category is 1 and the lowest status is Transfer Category 3. Similarly, Class I is the highest status for release sites and Class III is the lowest. As noted previously, the proposed rules categorize breeding facilities and release sites based on relative risk. The definition is necessary because the proposed new rules predicate the eligibility of deer breeding facilities to transfer and receive breeder deer, and the release site testing requirements once they have received deer, upon the status of the breeding facility or release site. PROPOSED RULES October 2, 2015 40 TexReg 6859

Proposed new 65.90(21) would define "Tier 1 facility" as "any facility authorized to possess white-tailed deer or mule deer that has received an exposed deer within the previous five years or transferred deer to a CWD-positive facility within the five-year period preceding the confirmation of CWD in the CWD-positive facility." The definition is necessary to offer a shorthand reference to those facilities that have a direct connection to a CWD-positive facility. Proposed new 65.90(22) would define "TAHC" as "Texas Animal Health Commission." The Texas Animal Health Commission is the state agency charged with protecting livestock in the state, including farmed cervids. Proposed new 65.90(23) would define "TAHC CWD Herd Certification Program" as "the disease-testing and herd management requirements set forth in 4 TAC 40.3 (relating to Herd Status Plans for Cervidae)." The proposed new rules have provisions specific to deer breeders who participated in the TAHC herd certification program. The definition makes it clear that references to herd certification are references to the herd certification program administered by TAHC. Proposed new 65.90(24) would define "TAHC Herd Plan" as "a set of requirements for disease testing and management developed by TAHC for a specific facility." The proposed new rules in some cases make eligibility to transfer or receive breeder deer contingent on compliance with a herd plan developed by TAHC. The definition makes it clear that references to herd plans are references to herd plans developed by TAHC. Proposed new 65.90(25) would define "TWIMS" as "the department's Texas Wildlife Information Management Services (TWIMS) online application." TWIMS is the system that all deer breeders are required to use to file required notifications and reports required by current rule. General Provisions Proposed new 65.91, concerning General Provisions, would set forth a number of provisions that are applicable to the transfer or release of breeder deer. Proposed new 65.91(a) would stipulate that in the event that a provision of the proposed new rules conflicts with any other provision of 31 TAC Chapter 65, the new rules (if adopted) would apply. Because of the need to quickly implement a regulatory response to the emergence of CWD there is insufficient time to harmonize the proposed new rules with the agency's existing rules governing white-tailed deer and mule deer. Therefore, the proposed new rules would clarify that the proposed new rules govern in the event of conflict. Proposed new 65.91(b) would prohibit the transfer of live breeder deer for any purpose except as provided by the proposed new rules. Because deer breeders frequently transfer deer to and receive deer from other deer breeders, as well as transfer breeder deer for release, it is necessary in light of the emergence of CWD in a Texas deer breeding facility to prohibit the movement of breeder deer except as authorized by the proposed rules. Proposed new 65.91(c) would prohibit the movement of deer to or from a deer breeding facility where CWD has been detected, beginning with the notification that a "suspect" test result has been received and lasting until the department authorizes resumption of activities. Given that CWD is an infectious disease, it is necessary to prohibit certain activities in order to contain the spread of the disease. Proposed new 65.91(d) would prohibit the transfer of exposed breeder deer from a deer breeding facility unless specifically authorized in a TAHC herd plan and then only in accordance with the provisions of the proposed new rules. Under TAHC rules, any deer breeding facility that receives breeder deer from CWD-positive facility is automatically placed under a "hold order," which prohibits the movement of breeder deer out of the facility while TAHC conducts an epidemiological investigation and creates a herd plan for the facility based on that investigation. If the TAHC herd plan provides that movement of exposed deer can resume, then such movement may result if authorized by and if in compliance with the proposed new rules (if adopted). Proposed new 65.91(e) would stipulate that a breeding facility or release site that receives breeder deer from an originating facility of lower status would automatically assume the status of the originating facility and become subject to the testing and release requirements of the proposed new rules. The proposed new rules create a tiered system of testing requirements based on the level of risk of transmission of CWD for each deer breeding facility. The level of risk is based on the degree to which the facility has been monitored for the presence of CWD, or contains or is connected to exposed animals. Epidemiological science dictates that a population receiving individuals from a higher risk population is itself at greater risk; therefore, the proposed new rules would address such transfers from higher risk to lower risk populations by requiring the receiving facility or release site to comply with the testing requirements associated with the originating facility. Proposed new 65.91(f) would explicitly outline the timeframes for facilities or release sites to increase its status following a loss of status. A discussion of this provision was provided earlier in this preamble. Proposed new 65.91(g) would stipulate that a CWD test is not valid unless it is performed by an accredited testing facility. Obviously, the department's efforts to detect and contain CWD depend on the quality of the testing itself. At the current time, USDA will not certify herd plans for cervidae unless CWD testing is performed by laboratories that have been approved by USDA. The standard for approval is compliance with 9 CFR 55.8, which sets forth the specific tests, methodology, and procedure for conducting CWD tests. Therefore, in order to ensure that CWD tests are performed in accordance with uniform standards, the proposed new rules would require all CWD tests to be performed by a laboratory approved by USDA. Additionally, the proposed new subsection would specify which tissues must be submitted and who is authorized to collect those tissues. At the current time, the only CWD testing approved by USDA must be performed on certain tissues from eligible mortalities, such as the obex (a structure in the brain) or certain lymph nodes. Laypersons can be trained to remove an obex, but the successful extraction of appropriate lymph nodes requires an experienced veterinarian, technician, or biologist. Therefore, the proposed new subsection also stipulates that to be valid, a CWD test must be performed on an obex, which can be collected by anyone. If a lymph node is to be tested in addition to the obex, it must be a medial retropharyngeal lymph node collected from the eligible mortality by an accredited veterinarian or other person approved by the department. Proposed new 65.91(h) would require all applications and notifications required by the proposed new rules to be submitted to the department electronically via the department's TWIMS application or by another method expressly authorized by the depart- 40 TexReg 6860 October 2, 2015 Texas Register

ment. Under current rule, deer breeders are required to submit all applications and reports via TWIMS; the proposed new rules would do so also, but also allow the department to authorize another method in an effort to account for unexpected situations, such as TWIMS being unavailable. Proposed new 65.91(i) would require compliance with TAHC rules concerning CWD, to the extent that they are applicable to white-tailed deer and mule deer. The department's response to CWD is part of a multi-agency cooperative effort with TAHC. In addition to the applicability of the department's rules regarding movement of breeder deer, TAHC rules govern herd plans; the department intends to enforce those rules under the authority of Parks and Wildlife Code, Chapter 43, Subchapter L. Transfer Categories and Requirements Proposed new 65.92, concerning Transfer Categories and Requirements, would set forth provisions generally applicable to deer breeding facilities as well as delineating a tiered system of testing requirements predicated on a given deer breeding facility's exposure to deer from a CWD-positive facility. Proposed new 65.92(a) would establish those provisions generally applicable to the transfer of breeder deer from a deer breeding facility. Proposed new 65.92(a)(1) would provide for the transfer of breeder deer, pursuant to activation of a valid transfer permit, for four purposes: (1) to another deer breeder; (2) to an approved release site; (3) to a Deer Management Permit (DMP) facility; or (4) to another person for nursing purposes. Under previous rules at 65.610 of this title (relating to Transfer of Deer), breeder deer may be transferred only after the activation of a transfer permit and only for specific purposes (to another deer breeder; for release to the wild; to a DMP facility; to the holder of an educational display or zoological permit issued by the department; or on a temporary basis to another person for nursing purposes or to receive medical attention). Given the threat of transmission of CWD, the proposed new rules contemplate the qualified transfer of breeder deer in a narrower context. Therefore, the proposed new rules would allow the movement of breeder deer for four purposes, contingent on the satisfaction of testing requirements imposed by the proposed new rules or a TAHC herd plan. Notwithstanding the provisions of proposed new 65.92(a)(1), proposed new 65.92(a)(2) would prohibit the movement of breeder deer if: (1) the transfer is not authorized under a TAHC herd plan; (2) "not detected" CWD test results have been submitted for less than 20 percent of eligible mortalities at the breeding facility since May 23, 2006; (3) the breeding facility has an unreconciled herd inventory; or (4) the breeding facility is not in compliance with the provisions of 65.608 of this title (relating to Annual Reports and Records). The basis for each of these three prohibitions is explained as followed. With regard to the first prohibition, since a TAHC herd plan will normally not authorize the movement of breeder deer if the deer breeder does not institute a testing program, and/or comply with other requirements, proposed new paragraph (2)(A) would prohibit movement of breeder deer from a breeding facility that is not authorized to do so under the TAHC herd plan for the facility. With regard to the second prohibition, previous rules at 65.604 of this title (relating to Disease Monitoring) allowed a deer breeder to move breeder deer if, among other things, CWD test results of 'not detected' had been returned from an accredited test facility on a minimum of 20 percent of all eligible breeder deer mortalities occurring within the facility since May 23, 2006. Although from an epidemiological perspective this standard provides a relatively low statistical confidence of detecting CWD if it exists in a facility, a less stringent standard would be of little value in detecting CWD. Therefore, any breeding facility not in compliance with this standard should not be allowed to move breeder deer until it has "tested out," or submitted sufficient test samples of "not detected" to provide a higher level of confidence that CWD will not be transmitted from the facility. The third and fourth prohibitions are related to reconciled herds and annual reports. Current department rules at 65.608 of this title (relating to Annual Reports and Records) require deer breeders to submit an annual report. The annual report must include a herd reconciliation that accounts for every breeder deer held, acquired, or transferred by a breeding facility, as well as births and mortalities. A breeding facility that is not in compliance with the reporting requirements or has submitted incomplete or inaccurate records frustrates efforts to determine the source and/or disposition of every deer in the facility, meaning that any number of scenarios could be possible with respect to disease transmission. Proposed new 65.92(a)(3) would prohibit the transfer of a breeder deer to a Class III release site unless the deer has been tagged with an approved RFID or NUES ear tag. As has been discussed, the proposed new rules create a classification system for breeding facilities that is based on the extent to which the facility is believed to have been exposed to CWD and the testing history of the facility. The proposed new rules also create a similar system for classifying release sites. As described in more detail later in this preamble, deer within a Class III release site are at a higher risk for CWD. The department believes that breeder deer released onto a Class III site should be readily identifiable for purposes of CWD testing. Therefore, the proposed new rules would require such deer to be eartagged prior to release. Proposed new 65.92(a)(4) would stipulate that a deer breeding facility initially permitted after March 31, 2015 will assume the lowest status among all originating facilities from which deer are received. Proposed new 65.92(a)(4) would also provide that a breeding facility cannot assume TC 1 status unless it meets the criteria established in proposed new 65.92(b)(1), which limits the TC 1 designation to those facilities that are not Tier 1 facilities and have a "fifth-year" or "certified" status in the TAHC CWD Herd Certification Program. Proposed new 65.92(b) would enumerate the three categories of breeding facilities and the testing requirements for each. Proposed new 65.92(b)(1) would establish that a breeding facility is a TC 1 facility if it is not a Tier 1 facility and has "fifth-year" or "certified" status in the TAHC CWD Herd Certification Program. Because a TC 1 facility has achieved this status in a disease monitoring protocol and has neither accepted deer from nor transferred deer to a CWD-positive facility, a TC 1 facility is a breeding facility that is least likely to contain CWD-positive breeder deer. Additionally, because a TC 1 facility with "fifth-year" or "certified" status in the TAHC CWD Herd Certification Program is considered to be adequately monitoring for CWD, there are no additional testing requirements imposed by the proposed new rules on TC 1 facilities. Proposed new 65.92(b)(2) would establish that a breeding facility is a TC 2 facility if it is not a Tier 1 facility and it has returned PROPOSED RULES October 2, 2015 40 TexReg 6861

"not detected" CWD test results for either 4.5 percent (or more) of the average number of deer at least 16 months of age (or 12 months of age, if the facility is participating in the TAHC herd certification program) within the facility during the previous two reporting years, or 50 percent of all eligible mortalities during the previous two reporting years, whichever represents the lowest number of deer tested. From an epidemiological point of view, not being a Tier 1 deer breeding facility is not, in and of itself, sufficient to provide any meaningful level of statistical confidence that CWD is not present within the population at the facility. However, in concert with effective surveillance, increased confidence can be obtained. The success of control and mitigation of infectious diseases is dependent on how soon the disease is detected after it is introduced, how quickly the source of the outbreak is identified, and how quickly infected animals can be isolated. The most effective first step in managing a disease outbreak in a herd of animals is to isolate those individuals known to have been in contact with infected individuals and then test those animals. Unfortunately, as noted previously, the only CWD tests for deer currently approved by USDA must be performed post-mortem (i.e., there is currently no accepted live-animal test). The department recognizes that deer breeders have a considerable investment in their facilities and herds, and that preserving business continuity is an important consideration within the regulatory context. The testing requirement for TC 2 breeding facilities in proposed 65.92(b)(2) is the result of a statistical model developed by the department, in consultation with the TAHC, based on the reported average annual adult-mortality rate for all breeding facilities, which is approximately 4.5 percent. Thus, testing 4.5 percent of the adult population is equivalent to testing 100 percent of expected adult mortalities. As an example, a breeding facility with 100 adult deer that did not test 50% of the eligible mortalities during the previous two reporting periods would have the option to submit five "not detected" test results, which could include test results submitted during the previous two years. This standard is more stringent than the disease-testing requirements prior to the adoption of the emergency rules. The intent of this approach is to provide an enhanced method for detection of CWD early enough to allow for an effective response. Proposed new 65.92(b)(3) would establish that a breeding facility is a TC 3 facility if it is neither a TC 1 nor a TC 2 facility. The proposed new paragraph also would stipulate that a TC 3 facility could achieve TC 2 status by submission of "not detected" CWD test results for each breeder deer received by the facility from a CWD-positive site and for 4.5 percent (or more) of the average number of adult deer within the facility during the previous two reporting years. Obviously, a TC 3 facility represents the lowest confidence with respect to the presence of CWD. Therefore, the proposed new rules would allow transfer of breeder deer from a TC 3 only if it provided "not detected" test results for a sufficient number of adult deer in the facility in addition to any exposed deer associated with the facility (and was not under a hold order issued by TAHC). Proposed new 65.92(b)(3)(C) would require all deer transferred from a TC 3 breeding facility to a DMP facility, including buck deer that are returned from a DMP facility to a breeding facility, to be eartagged with an RFID/NUES tag. As has been discussed, the proposed new rules create a classification system for breeding facilities that is based on the extent to which the facility is believed to have been exposed to CWD and the testing history of the facility. A DMP permit authorizes the temporary detention of free-ranging deer for breeding purposes; therefore, if a breeder deer is introduced to a DMP pen, those free-ranging deer come into contact with the breeder deer, and when they are released, they therefore come into contact with additional free-ranging deer. This scenario is epidemiologically analogous to the release of breeder deer to a Class III release, for which proposed new 65.92(a)(3) also impose eartagging requirements. Proposed new 65.92(c) would allow breeder deer to be temporarily transferred to a veterinarian for medical care. The department has determined that the temporary movement of breeder deer to a veterinary medical facility for treatment poses a low risk of transmitting CWD. Proposed new 65.93, concerning Release Sites - Qualifications and Testing Requirements, would set forth provisions generally applicable to locations where breeder deer are released to the wild. As noted above, the proposed rules classify release sites based on relative level of risk. More specifically, the classification of a release site is based on the release site's level of risk, including exposure to deer from a CWD-positive facility. Proposed new 65.93 establishes testing and other requirements associated with release sites generally and with specific classes of release sites. Proposed new 65.93(a) would establish those provisions generally applicable to release sites. Proposed new 65.93(a)(1) would stipulate that an approved release site consists solely of the specific tract of land and acreage designated as a release site in TWIMS. Proposed new 65.93(a)(2) also would require all release sites to be surrounded by a fence of at least seven feet in height that is capable of retaining deer at all times. Proposed new 65.93(a)(2) also would require the owner of the release site to be responsible for ensuring that fencing and associated infrastructure retain the deer under ordinary and reasonable circumstances. In order to provide a measure of confidence that CWD is not spread from those places where breeder deer are released, it is necessary to identify the specific location where breeder deer are authorized to be released. Similarly, it is necessary to establish a level of vigilance sufficient to give reasonable assurance that breeder deer are not allowed to leave the specific premise where they were released. Proposed new 65.93(a)(3) would set forth the on-site harvest documentation requirements for Class II and Class III release sites. The proposed new paragraph would require the owner of a Class II or Class III release site to maintain a daily harvest log at the release site. For each deer harvested from a Class II or Class III release site, the proposed new rules would require the hunter's name and hunting license number (or driver's license number, if the daily harvest log is also being used as a cold storage/processing book) to be entered into the harvest log, along with the date of kill, type of deer killed, any alphanumeric identifier tattooed on the deer, the tag number of any RFID or NUES tag affixed to the deer; and any other identifier and identifying number on the deer. The proposed new provision would enable the department to identify all deer harvested at a given release site (including deer that were released breeder deer) if an epidemiological investigation becomes necessary. The proposed new paragraph also would require the daily harvest log to be presented to any department employee acting within the scope of official duties and for the contents of the daily harvest log to be reported to the department via TWIMS by no later March 15 of each year. Proposed new 65.93(a)(4) would provide that a release site's status cannot be altered by the sale or subdivision of a property 40 TexReg 6862 October 2, 2015 Texas Register

to a related party if the purpose of the sale or subdivision is to avoid the requirements of this division. The department believes that a landowner subject to the provisions of the proposed new rules should not be able to avoid compliance simply by selling, donating, or trading the property to another person related to the seller. Proposed new 65.93(a)(5) would require the owner of a release site, as a consequence of consenting to the release of breeder deer on the release site, to submit all required CWD test results to the department as soon as possible but not later than May 1 of each year. The proposed new rules contemplate a disease management strategy predicated on the results of CWD testing. Incomplete, inadequate, or tardy reporting of test results confounds that strategy. For this reason, the proposed new paragraph would establish a date certain for reporting test results to the department. The proposed new paragraph also would provide that failure to timely submit test results will result in the release site being declared ineligible to be a destination for future releases. In light of the threat that CWD poses to native and farmed deer, it is prudent to suspend release site privileges for any landowner who does not comply with the testing requirements for release sites. Proposed new 65.93(a)(6) would prohibit any person from intentionally causing or allowing any live deer to leave or escape from a release site. The proposed new provision is necessary to ensure that once a release site has received breeder deer, no deer from the release site (breeder deer or free-ranging deer) are able to come into contact with surrounding populations of free-ranging deer. Proposed new 65.93(b) would enumerate the three categories of release sites and the testing requirements for each. Proposed new 65.93(b)(1) would establish that a release site is a Class I release site if it is not a Tier 1 facility and it receives breeder deer only from TC 1 facilities. Because a TC 1 facility has a "fifth-year" or "certified" status in the TAHC CWD Herd Certification Program, a TC 1 facility is considered to be adequately monitoring for CWD. As a result, there are no additional testing requirements imposed by the proposed new rules on Class I release sites. Proposed new 65.93(b)(2) would establish that a release site is a Class II release site if it is not a Tier 1 facility, receives any breeder deer from a TC 2 facility, and receives no breeder deer from a TC 3 facility. The Class II designation is an intermediate category intended for release sites that have not received breeder deer from higher risk sources (i.e., Tier 1 and/or TC 3 facilities) but at the same time have not received deer solely from TC 1 facilities. Such release sites are considered to present more risk than Class I but less risk than Class III for harboring CWD. Proposed new 65.93(b)(2)(B) also would impose testing requirements for Class II release sites. Specifically, if deer are harvested by hunters on a Class II release site during an open deer season, the landowner must test either a number of deer equivalent to 50 percent of the number of breeder deer released at the site between the last day of the previous year's deer season and the end of any open season for deer in the current year, or 50 percent of all deer harvested by hunters, whichever value is lower. The proposed new paragraph would also provide that if any hunter-harvested deer were breeder deer released between the end of the previous deer season and the current deer season, 50 percent of those deer must be submitted for CWD testing, which may be counted to satisfy the requirements of 65.93(b)(2)(B). As mentioned previously in this preamble, from an epidemiological perspective, not being a Tier 1 facility is not, in and of itself, sufficient to provide high statistical confidence that CWD is not present or has not been introduced within the population at the release site. However, in concert with effective surveillance, increased confidence can be obtained. The success of control and mitigation of infectious diseases is dependent on how soon the disease is detected after it is introduced, how quickly the source of the outbreak is identified, and how quickly infected animals can be isolated. Although the most efficacious monitoring regime on a release site would be to require 100 percent of all harvested deer to be submitted for testing, the department is proposing to require the testing of only 50 percent of hunter-harvested deer at this time. Proposed new 65.93(b)(3) would establish that a release site is a Class III site release site if it is a Tier 1 facility (it has received deer from a CWD-positive facility) or it receives deer from an originating facility that is a TC 3 facility (the default status for breeding facilities that cannot provide statistical confidence that CWD is not present in the facility). The Tier 1 and TC 3 designations represent those environments that have the highest likelihood of harboring CWD; accordingly, the proposed new paragraph would require the landowner of a Class III release site to test 100 percent of all hunter-harvested deer or one hunter-harvested deer per breeder deer released between the end of the previous year's deer season and the end of the current deer season, whichever results in the greatest number of test results. Again, the department emphasize that the proposed new rules, if adopted, would be an interim replacement for the current emergency rules adopted on August 18, 2015 (40 TexReg 5566), ("emergency CWD rules"). As noted previously, based additional information from the ongoing epidemiological investigation, disease surveillance data collected from captive and free ranging deer herds, guidance from the TAHC, and input from stakeholder groups, the department intends to review the interim rules following the close of the deer season and present the results of that review to the Commission in the spring of 2016 for possible modifications. Clayton Wolf, Wildlife Division Director, has determined that for each of the first five years that the rules as proposed are in effect, there will be no fiscal implications to state and local governments as a result of enforcing or administering the rules as proposed, as department personnel currently allocated to the administration and enforcement of the permit programs affected will administer and enforce the rules as part of their current job duties. Mr. Wolf also has determined that for each of the first five years the new rules as proposed are in effect, the public benefit anticipated as a result of enforcing or administering the rules as proposed will be a reduction of the probability of CWD being spread from facilities where it might exist and an increase in the probability of detecting CWD if it does exist, thus ensuring the public of continued enjoyment of the resource and also ensuring the continued beneficial economic impacts of hunting in Texas. Additionally, the protection of free-ranging deer herds will have the simultaneous collateral benefit of protecting captive herds, and maintaining the economic viability of deer breeding operations. There will be adverse economic impact on persons required to comply with the rules as proposed, which are the same as the adverse economic impacts to small and microbusinesses, which are addressed later in this preamble. PROPOSED RULES October 2, 2015 40 TexReg 6863

Under the provisions of Government Code, Chapter 2006, a state agency must prepare an economic impact statement and a regulatory flexibility analysis for a rule that may have an adverse economic effect on small businesses and micro-businesses. As required by Government Code, 2006.002(g), in April 2008, the Office of the Attorney General issued guidelines to assist state agencies in determining a proposed rule's potential adverse economic impact on small businesses. These guidelines state that "[g]enerally, there is no need to examine the indirect effects of a proposed rule on entities outside of an agency's regulatory jurisdiction." The guidelines state that an agency need only consider a proposed rule's "direct adverse economic impacts" to small businesses and micro-businesses to determine if any further analysis is required. The guidelines also list examples of the types of costs that may result in a "direct economic impact." Such costs may include costs associated with additional recordkeeping or reporting requirements; new taxes or fees; lost sales or profits; changes in market competition; or the need to purchase or modify equipment or services. Parks and Wildlife Code, 43.357(a), authorizes a person to whom a breeder permit has been issued to "engage in the business of breeding breeder deer in the immediate locality for which the permit was issued" and to "sell, transfer to another person, or hold in captivity live breeder deer for the purpose of propagation." As a result, deer breeders are authorized to engage in business activities; namely, the purchase and sale of breeder deer. Government Code, 2006.001(1), defines a small or micro-business as a legal entity "formed for the purpose of making a profit" and "independently owned and operated." A micro-business is a business with 20 or fewer employees. A small business is defined as a business with fewer than 100 employees, or less than $6 million in annual gross receipts. Although the department does not require deer breeders to file financial information with the department, the department believes that most if not all deer breeders would qualify as a small or micro-business. Since the rules as proposed would impact the ability of a deer breeder to engage in certain activities undertaken to generate a profit, the proposed rules may have an adverse impact on deer breeders. Impact on Sales The variety of business models utilized by deer breeders makes meaningful estimates of potential adverse economic impacts difficult. Although a deer breeder has the permit privilege to buy and sell breeder deer and many deer breeders participate in a market for breeder deer, other deer breeders are interested only in breeding and liberating deer on their own property for hunting opportunity. Once a breeder deer is liberated, it cannot be returned to a breeding facility and assumes the same legal status as all other free ranging deer. Thus, if the deer breeder is engaged primarily in buying and selling deer, the potential adverse economic impact is greater than that for a deer breeder who engages in deer breeding activities primarily for purposes of release onto that person's property. The department does not require deer breeders to report the buying or selling prices of deer. However, publicly available and anecdotal information indicates that sale prices, especially for buck deer, may be significant. The sale price for a single deer may range from hundreds of dollars to many thousands of dollars. It should also be noted that some aspects of this analysis are based on anticipated marketplace behavior which cannot be accurately predicted. In addition, to the extent that any marketplace analysis can be conducted, it is difficult, if not impossible, to accurately separate and distinguish marketplace behavior that is the result of the proposed rules from marketplace behavior that is the result of the discovery of CWD. For reasons unrelated to the regulations, it is possible, perhaps even likely, that breeders and release site owners would be reluctant to purchase a breeder deer from a facility with a close relationship to a facility at which CWD has been detected. The proposed new rules would not completely prohibit the transfer of deer except by CWD-positive facilities, and facilities prohibited from transfer by TAHC hold order (in addition to facilities that were not allowed to transfer deer under previous regulations due to failure to test a minimum number of deer or failure to comply with record-keeping requirements). All TC 1 and TC 2 facilities (and 429 TC 3 facilities) would be allowed to transfer deer, provided certain conditions are met. For TC 1 facilities, the department has determined that there will likely be no adverse economic impact on sales as a result of the proposed new rules. Since transfers of breeder deer from TC 1 facilities are subject to the fewest restrictions under the proposed rules, breeder deer from a TC 1 facility can more easily be sold to other breeders or to landowners for purposes of liberation on a release site. In addition, TC 1 facilities are already subject to monitoring and testing at a higher level. Department records indicate that there are currently 63 TC 1 facilities in the state. For TC 2 facilities, the adverse economic impact of the proposed new rules would consist of the cost of the additional testing requirements (described in more detail below) and possible loss of sales to TC 1 facilities and Class I release sites. The proposed new rules would not prohibit the transfer of breeder deer by TC 2 facilities, but because the proposed new rules would cause any TC 1 facility or Class I release site that accepts deer from a TC 2 (or TC 3) facility to assume the status (and regulatory obligations, such as testing) of the TC 2 (or TC 3) facility, and because TC 2 facilities carry a greater risk of exposure to CWD, it can be assumed that TC 1 facilities or Class I release sites will be less likely destinations for breeder deer coming from facilities of lower status. Department records indicate that there are currently 759 TC 2 facilities in the state, and that in the last year, 528 of them transferred breeder deer to facilities that are now TC 1 or Class I release sites. The most breeder deer transferred from any breeding facility was 175, but the overwhelming majority of transfers were 10 or fewer deer. The impact to the deer breeder would be the loss of the sale and any attendant profit from the sale of deer. As previously mentioned in this analysis, the department does not require holders of deer breeder permits to disclose the dollar values of sales and purchases of breeder deer; therefore, an exact quantification of the possible impact of the proposed new rules on TC 2 facilities cannot be accurately calculated. However, based on public and anecdotal information, such impact could be from few hundred dollars or less per deer or to thousands of dollars per deer. However, as noted previously, under the 65.92(b) of the proposed rules, only those breeding facilities that are not Tier I facilities and have obtained a "fifth-year" or "certified" status from TAHC, are considered TC 1 facilities. In order to maintain "fifth year" or "certified" from TAHC, such facilities may receive deer only from other "fifth-year" or "certified" breeding facilities. Therefore, it should be noted, that a TC 1 facility was not a likely destination for a breeder deer from a TC 2 facility under previous regulations. For TC 3 facilities, the adverse economic impact of the proposed new rules would consist of the cost of the additional testing re- 40 TexReg 6864 October 2, 2015 Texas Register

quirements (described in more detail below) and possible loss of sales to TC 1 and TC 2 facilities and Class I and Class II release sites. The proposed new rules would not prohibit the transfer of breeder deer by TC 3 facilities unless the facility is a CWD-positive facility or prohibited from transferring deer under a TAHC hold order (in addition to facilities that were not allowed to transfer deer under previous regulations due to failure to test a minimum number of deer or failure to comply with record-keeping requirements). Because the proposed new rules would cause any facility or release site of higher status that accepts deer from a TC 3 facility to assume the status (and regulatory obligations, such as testing) of that facility, it can be assumed that higher status facilities and release sites will be less likely destinations for breeder deer coming from facilities of lower status. Department records indicate that there are currently 497 TC 3 facilities in the state, and that last year, 288 of them transferred breeder deer to facilities that are now higher-status facilities or release sites. The greatest number of breeder deer transferred from any breeding facility last year that is now a TC 3 facility was 111, but the overwhelming majority of transfers were 10 or fewer deer. As previously mentioned in this analysis, the department does not require holder of deer breeder permits to disclose the dollar values of sales and purchases of breeder deer; therefore, an exact quantification of the possible impact of the proposed new rules on TC 2 facilities cannot be calculated. However, based on public and anecdotal information, such impact could be from few hundred dollars or less per deer or to thousands of dollars per deer. The proposed new rules would prohibit the introduction to or removal of deer from breeder facilities that are CWD-positive or that have received exposed breeder deer, which would result in an adverse economic impact to deer breeders whose facilities are either an index facility or a Tier 1 facility, or both. The extent of such adverse economic impact would consist of loss of revenue as a result of being unable to introduce or remove deer from the breeding facility and thus being unable to deliver or accept deer that have been bought or sold. The dollar value of the adverse economic impact is dependent on the volume of deer produced or acquired by any given permittee, which can vary from a few deer to hundreds of deer. However, as noted above, it is difficult, if not impossible, to accurately determine whether and how much any adverse economic impact is due to the presence of CWD in a facility or a related facility or would be due to the proposed regulations. Department records indicate that there are two CWD-positive breeding facilities and 104 Tier 1 breeding facilities that are currently not eligible to transfer deer. The department notes that with the exception of breeding facilities that are CWD-positive, the proposed new rules allow Tier 1 facilities (which would be classified as TC 3 facilities) to transfer breeder deer following successful compliance with the testing and other provisions of the proposed new rules. Testing Costs The proposed new rules would cause an adverse economic impact to deer breeders and release site owners who must undertake disease-testing requirements to continue certain activities. As a result, deer breeders who are not TC 1 facilities and owners of release sites that are not Class I release sites would incur costs related to the increased testing and monitoring requirements of the proposed new rules. The cost of a CWD test administered by the Texas Veterinary Medicine Diagnostic Lab (TVMDL) on a sample collected and submitted by a deer breeder is a minimum of $46, to which is added a $6 submission fee (which may cover multiple samples submitted at the same time). If a whole head is submitted to TVDML there is an additional $20 sample collection fee, plus a $20 disposal fee. Thus, the fee for submitting an obex or obex/medial retropharyngeal lymph node pair would be $52, plus any veterinary cost (which the department cannot quantify) and the fee for submitting an entire head for testing would be $92. Facilities that are seeking to become "certified" or "fifth year" facilities are also required to obtain an annual inventory by an accredited veterinarian. The cost of an annual inventory by an accredited veterinarian is estimated by TAHC to be approximately $250. However, it should be noted that the requirements for obtaining "certified" or "fifth year" status are not imposed by the proposed rules, but rather by existing TAHC regulations. The department estimates that the direct economic impact of testing in order become "movement qualified" under the proposed new rules would be between $52 and $92 per deer per year for each permittee who desires to meet to criteria for moving deer under the proposed new rules. If the sample is collected, fixed, and submitted by a private veterinarian, the cost could be higher. However, it should be noted that under previous rules, a breeder facility that sought to transfer deer was required to test 20 percent of eligible mortalities for CWD. Therefore, only that portion of the estimated testing costs associated with the additional testing under the proposed new rules would be the result of the proposed rules. For a TC 1 facility, the difference between the current rules and the proposed new rules would be the requirement to have "fifthyear" or "certified" status in the TAHC CWD Herd Certification Program, which required the testing of all mortalities aged 12 months or more (rather than 20 percent, as currently required by department rules), and the cost of an annual inventory conducted by an accredited veterinarian (which is also required by TAHC regulations (4 TAC 40.3)). However, as noted above, current TC 1 facilities were already complying with these TAHC requirements. This impact would be only for those facilities that are not TC 1 facilities but are seeking to obtain this TC 1 status in order to more easily transfer deer. For a TC 2 facility, the difference between the current rules and proposed new rules would be the requirement to test 4.5 percent or 50 percent of all eligible mortalities (rather than 20 percent, as currently required). Such costs would be necessary only if a TC 2 facility owner wishes to engage in activities involving movement of deer to deer breeding facilities and release sites of certain status. The department notes that because CWD has been proven to be transmissible by direct contact (including through fences) and via environmental contamination, there may be adverse economic impacts unrelated to the proposed new rules in the event that CWD is confirmed in a breeding facility due to the possible reluctance of potential customers to purchase deer from a facility that accepted deer from a CWD-positive facility. Additionally, in the absence of the proposed new rules, if CWD is detected within a facility or breeder deer that have been in a facility that accepted deer from a CWD-positive facility, there could be lost revenue to the permittee since potential purchasers who are aware of CWD would likely refrain from purchasing deer from such a facility. Therefore, the proposed new rules, by providing a mechanism to minimize the spread of CWD, could also protect the economic interests of the regulated community. PROPOSED RULES October 2, 2015 40 TexReg 6865

The department also notes that for any given deer breeder that is currently not qualified to move or release deer, compliance with the proposed new rules could be achieved in five years or less and at the additional direct economic cost of CWD testing requirements imposed by the proposed new rules. Loss of Sacrificed Deer The proposed new rules would provide for the testing of additional deer (compared to the previous testing requirements) for some deer breeders who desire to move to a higher status. If deer are sacrificed for testing (in addition to eligible mortalities), there could be an economic impact from the loss of the deer and any revenue that might have been realized from the sale of the deer to another breeder or to a release site for liberation. As noted previously, the department does not require that breeders report financial data. The economic impact on a deer breeder would depend on whether the deer breeder sacrifices deer to achieve testing requirements, and the number and type of deer sacrificed. As noted above, the lost revenue from the sacrificed deer could range from few hundred dollars or less per deer to thousands of dollars per deer. Release Sites The proposed new rules will result in adverse economic impacts to landowners of Class II and Class III release sites, who would be required to comply with certain testing requirements. Only those landowners who receive breeder deer would be subject to the testing requirements imposed by the proposed rules. Department data indicate that 26,684 breeder deer were liberated at 1,594 release sites in the last year (an average 17.4 deer per release). The single largest liberation was 175 deer in a single transaction in the 2014-2015 permit year, but the vast majority of releases involved fewer than 10 deer. For a Class II release site, if deer are hunter-harvested, a number of deer equivalent to 50 percent of the number of breeder deer released at the site between the last day of lawful deer hunting at the site in the previous year and the last day of lawful deer hunting at the site in the current year must be tested, or 50 percent of all hunter-harvested deer. The proposed new rules also requires 50 percent of any hunter-harvested deer that were released breeder deer to tested, which may be counted to satisfy the total testing requirement. For a Class III release site, the proposed new rules would require 100 percent of all hunter-harvested deer to be tested or one hunter-harvested deer per breeder deer released between the last day of lawful deer hunting at the site in the previous year and the last day of lawful deer hunting at the site season in the current year. The analysis of CWD testing costs for deer breeding facilities presented earlier in this preamble also applies to release sites. Also, because the proposed new rules require all release sites to be enclosed by a fence of at least seven feet in height, a landowner desiring to have breeder deer released on a tract that is not surrounded by such a fence would incur the cost of building one. The cost of fence construction varies by terrain and region, but anecdotal information suggests that it is $10,000 per linear mile or more. The department notes that only 610 breeder deer were released to low-fence environments last year, and that the practice is extremely rare because the deer represent a significant purchase cost and once they are released they become free-ranging deer and may be legally killed on an adjoining property should they wander from the release site. Alternatives Considered The department considered several alternatives to achieve the goals of the proposed new rules while reducing potential adverse impacts on small and micro-businesses and persons required to comply. The department considered proposing no rules. This alternative was rejected because the presence of CWD in breeding facilities is not hypothetical, but has been confirmed and presents an actual, direct threat to free-ranging and farmed cervid populations and the economies that depend upon them. A regulation that clearly sets out prudent and sensible restrictions on the regulated community is more likely to achieve the desired result of stemming the spread of CWD than having no regulations. The department concluded that the need to protect the wildlife resources that sustain the state's annual multi-billion-dollar hunting industry outweighs the temporary adverse impacts to small and micro-businesses and persons required to comply. The department also considered, in lieu of a regulatory response, the alternative of attempting to eliminate CWD at the CWD-positive sites and Tier 1 facilities by conducting a depopulation event, which means killing every deer within those sites in the hopes of eliminating the reservoir for the disease as well as identifying the source of the outbreak. This alternative was rejected because it would result in the destruction of several thousand deer and thus would have significant implications to business continuity of some deer breeders (the two CWD-positive facilities and the 104 breeding facilities that are now Tier 1 facilities). Furthermore, removing every animal that exists within an affected area does not remove prions (the infectious agent believed to cause CWD), which can be shed by an infected animal and remain in the environment and which in turn can infect susceptible animals introduced to or inhabiting the environment. The department also considered imposing less stringent testing requirements. This alternative was rejected because the testing requirements in the proposed new rules reflect mathematical models aimed at higher confidence than is possible under current disease-testing requirements that CWD is or is not present. Less stringent testing requirements would reduce confidence and therefore impair the ability of the department to respond in the event that CWD actually is present. The department also believes that a higher testing intensity is necessary to provide assurance to the hunting public, private landowners, and the regulated community that wildlife resources are safe and reliable. (C) The department has not drafted a local employment impact statement under the Administrative Procedure Act, Government Code, 2001.022, as the agency has determined that the rules as proposed will not result in direct impacts to local economies. (D) The department has determined that there will not be a taking of private real property, as defined by Government Code, Chapter 2007, as a result of the proposed new rules. Any impacts resulting from the discovery of CWD in or near private real property would be the result of the discovery of CWD and not the proposed rules. Comments on the proposed rule may be submitted to Mitch Lockwood, Texas Parks and Wildlife Department, 4200 Smith School Road, Austin, Texas 78744; (830) 792-9677 (e-mail: mitch.lockwood@tpwd.texas.gov); or via the department's website at www.tpwd.texas.gov. The new rules are proposed under the authority of Parks and Wildlife Code, Chapter 43, Subchapter L, which authorizes the 40 TexReg 6866 October 2, 2015 Texas Register

commission to make regulations governing the possession of breeder deer held under the authority of the subchapter; Subchapter R, which authorizes the commission to establish the conditions of a deer management permit, including the number, type, and length of time that white-tailed deer may be temporarily detained in an enclosure; Subchapter R-1, which authorizes the commission to establish the conditions of a deer management permit, including the number, type, and length of time that mule deer may be temporarily detained in an enclosure (although the department has not yet established a DMP program for mule deer authorized by Subchapter R-1); and 61.021, which provides that no person may possess a game animal at any time or in any place except as permitted under a proclamation of the commission. The proposed new rules affect Parks and Wildlife Code, Chapter 43, Subchapters C, E, L, R, and R-1. 65.90. Definitions. The following words and terms shall have the following meanings, except in cases where the context clearly indicates otherwise. (1) Accredited testing facility--a laboratory approved by the United States Department of Agriculture to test white-tailed deer or mule deer for CWD. (2) Breeder deer--a white-tailed deer or mule deer possessed under a permit issued by the department pursuant to Parks and Wildlife Code, Chapter 43, Subchapter L, and Subchapter T of this chapter. (3) Confirmed--A CWD test result of "positive" received from the National Veterinary Service Laboratories of the United States Department of Agriculture. (4) CWD--Chronic wasting disease. (5) CWD-positive facility--a facility registered in TWIMS and in which CWD has been confirmed. (6) Deer breeder--a person who holds a valid deer breeder's permit issued pursuant to Parks and Wildlife Code, Chapter 43, Subchapter L, and Subchapter T of this chapter. (7) Deer breeding facility (breeding facility)--a facility permitted to hold breeder deer under a permit issued by the department pursuant to Parks and Wildlife Code, Chapter 43, Subchapter L, and Subchapter T of this chapter. (8) Department (department)--texas Parks and Wildlife Department (9) Eligible mortality--a breeder deer that has died within a deer breeding facility and: (A) is 16 months of age or older; or (B) if the deer breeding facility is enrolled in the TAHC CWD Herd Certification Program, is 12-months of age or older. (10) Exposed deer--unless the department determines through an epidemiological investigation that a specific breeder deer has not been exposed, an exposed deer is a white-tailed deer or mule deer that: (A) is in a CWD-positive facility; or (B) was in a CWD-positive facility within the five years preceding the confirmation of CWD in that facility. (11) Hunter-harvested deer--a deer required to be tagged under the provisions of Subchapter A of this chapter (relating to Statewide Hunting Proclamation). (12) Landowner (owner)--any person who has an ownership interest in a tract of land, and includes a landowner's authorized agent. (13) Landowner's authorized agent--a person designated by a landowner to act on the landowner's behalf. (14) NUES tag--an ear tag approved by the United States Department of Agriculture for use in the National Uniform Eartagging System (NUES). (15) Originating facility--the source facility identified on a transfer permit. (16) Reconciled herd--the deer held in a breeding facility for which the department has determined that the deer breeder has accurately reported every birth, mortality, and transfer of deer in the previous reporting year. (17) Release site--a specific tract of land that has been approved by the department for the release of breeder deer under this division. (18) Reporting year--for a deer breeder, the period of time from April 1 of one calendar year to March 31 of the next calendar year. (19) RFID tag--a button-type ear tag conforming to the 840 standards of the United States Department of Agriculture's Animal Identification Number system. (20) Status--The level of testing required by this division for any given deer breeding facility or release site. For the transfer categories established in 65.92(b) of this title (relating to Transfer Categories and Requirements), the highest status is Transfer Category 1 (TC 1) and the lowest status is Transfer Category 3 (TC3). For the release site classes established in 65.93(b) of this title (relating to Release Sites - Qualifications and Testing Requirements), Class I is the highest status and Class III is the lowest. (21) Tier 1 facility--any facility registered in TWIMS that has: (A) received an exposed deer within the previous five years; or (B) transferred deer to a CWD-positive facility within the five-year period preceding the confirmation of CWD in the CWDpositive facility; and (C) is under a TAHC hold order. (22) TAHC--Texas Animal Health Commission. (23) TAHC CWD Herd Certification Program--The disease-testing and herd management requirements set forth in 4 TAC 40.3 (relating to Herd Status Plans for Cervidae). (24) TAHC Herd Plan--A set of requirements for disease testing and management developed by TAHC for a specific facility. (25) TWIMS--The department's Texas Wildlife Information Management Services (TWIMS) online application. 65.91. General Provisions. (a) To the extent that any provision of this division conflicts with any other provision of this chapter, this division prevails. (b) Except as provided in this division, no live breeder deer may be transferred anywhere for any purpose. (c) Notwithstanding any other provision of this chapter, no person shall introduce into or remove breeder deer from or allow or authorize breeder deer to be introduced into or removed from any deer breeding facility for which a CWD test result of 'suspect' has been ob- PROPOSED RULES October 2, 2015 40 TexReg 6867

tained from an accredited testing facility. The provisions of this subsection take effect immediately upon the notification of a CWD 'suspect' test result for a deer breeding facility, and continue in effect until the department expressly authorizes the resumption of permitted activities at that facility. (d) No exposed breeder deer may be transferred from a breeding facility unless expressly authorized in a TAHC herd plan and then only in accordance with the provisions of this division. (e) A breeding facility (including a facility permitted after the effective date of this subsection) or release site that receives breeder deer from an originating facility of lower status automatically assumes the status associated with the originating facility and becomes subject to the testing and release requirements of this division at that status. (f) A facility that has dropped in status may increase in status as follows: (1) from TC 3 to TC 2: by complying with the provisions of 65.92(b)(3)(B) of this title (relating to Transfer Categories and Requirements) for a period of two consecutive years; (2) from TC 2 to TC 1 status: by attaining "fifth-year" or "certified" status in the TAHC CWD Herd Certification Program. (g) A CWD test is not valid unless it is performed by an accredited testing facility on the obex of an eligible mortality, which may be collected by anyone. A medial retropharyngeal lymph node collected from the eligible mortality by an accredited veterinarian or other person approved by the department may be submitted to an accredited testing facility for testing in addition to the obex of the eligible mortality. (h) Unless expressly provided otherwise in this division, all applications and notifications required by this division shall be submitted electronically via TWIMS or by another method expressly authorized by the department. (i) A person who possesses or receives white-tailed deer or mule deer under the provisions of this division and Subchapter T of this chapter is subject to the provisions of TAHC regulations at 4 TAC Chapter 40 (relating to Chronic Wasting Disease) that are applicable to white-tailed or mule deer. 65.92. Transfer Categories and Requirements. (a) General. (1) A breeding facility that is a TC 1, TC 2, or TC 3 facility may transfer breeder deer under a valid transfer permit that has been activated and approved by the department as provided in 65.610(e) of this title (relating to Transfer of Deer) to: (A) another breeding facility; (B) an approved release site as provided in 65.93 of this division (relating to Release Sites - Qualifications and Testing Requirements); (C) a DMP facility under Chapter 65, Subchapter D of this title (relating to Deer Management Permits); or (D) to another person for nursing purposes. (2) Notwithstanding the provisions of paragraph (1) of this subsection, a breeding facility is prohibited from transferring breeder deer anywhere for any purpose if: (A) such a transfer is not authorized pursuant to a TAHC Herd Plan associated with a hold order or quarantine; (B) "not detected" CWD test results have been submitted for less than 20 percent of eligible mortalities at the breeding facility since May 23, 2006; the breeding facility has an unreconciled herd inventory; or (C) (D) the breeding facility is not in compliance with the provisions of 65.608 of this title (relating to Annual Reports and Records). (3) A deer breeder may not transfer a breeder deer to a Class III release site unless the deer has been tagged by attaching a button-type RFID or NUES tag approved by the department to one ear. (4) A deer breeding facility that was initially permitted after March 31, 2015 will assume the lowest status among all originating facilities from which deer are received; provided, however, a breeding facility shall not assume TC 1 status unless it meets the criteria established in subsection (b)(1) of this section. (b) Types of Facilities. (1) TC 1. A breeding facility is a TC 1 facility if: (A) it is not a Tier 1 facility; and (B) it has "fifth-year" or "certified" status in the TAHC CWD Herd Certification Program. (2) TC 2. A breeding facility is a TC 2 facility if: (A) it is not a Tier 1 facility; and (B) CWD test results of "not detected" have been returned for one of the following values, whichever represents the lowest number of tested breeder deer: (i) 4.5 percent or more of the breeder deer held within the facility during the immediately preceding two reporting years, based on the average population of deer in the facility that were at least 16 months of age on March 31 of each year (including eligible mortalities for those years); or (ii) 50 percent of all eligible mortalities from the preceding two reporting years, provided at least one eligible mortality was tested. (3) TC 3. (A) A breeding facility is a TC 3 facility if it is neither a TC 1 facility nor a TC 2 facility. (B) A breeding facility may increase status from TC 3 to TC 2 if CWD test results of "not detected" have been obtained for: (i) each breeder deer received by the breeding facility from any CWD-positive site; (ii) each exposed breeder deer that has been transferred by the breeding facility to another breeding facility or released; and (iii) 4.5 percent or more of the breeder deer held within the breeding facility during the immediately preceding two reporting years, based on the average population of deer in the facility that were at least 16 months of age on March 31 of each year (including eligible mortalities for those years). (C) All deer transferred from a TC 3 breeding facility to a DMP facility, including buck deer that are returned from a DMP facility to a breeding facility, must be eartagged with an RFID/NUES tag. 40 TexReg 6868 October 2, 2015 Texas Register

(c) Breeder deer may be temporarily transferred to a veterinarian for medical care. 65.93. Release Sites - Qualifications and Testing Requirements. (a) General. (1) An approved release site consists solely of the specific tract of land and acreage designated as a release site in TWIMS. (2) All release sites must be surrounded by a fence of at least seven feet in height that is capable of retaining deer at all times. The owner of the release site is responsible for ensuring that the fence and associated infrastructure retain the deer under ordinary and reasonable circumstances. (3) The owner of a Class II or Class III release site shall maintain a legible daily harvest log at the release site. (A) The daily harvest log shall be on a form provided or approved by the department and shall be maintained until the report required by subparagraph (E) of this paragraph has been submitted to and acknowledged by the department. (B) For each deer harvested on the release site and tagged under the provisions of Subchapter A of this chapter (relating to Statewide Hunting Proclamation), the landowner must, on the same day that the deer is harvested, legibly enter the information required by this subparagraph in the daily harvest log. (C) The daily harvest log shall contain the following information for each deer harvested on the release site: (i) harvested the deer; the name and hunting license of the person who (ii) the date the deer was harvested; (iii) the species (white-tailed or mule deer) and type of deer harvested (buck or antlerless); (iv) any alphanumeric identifier tattooed on the deer; (v) any RFID or NUES tag number of any RFID or NUES tag affixed to the deer; and the deer. (vi) any other identifier and identifying number on (D) The daily harvest log shall be made available upon request to any department employee acting in the performance of official duties. (E) By not later than March 15 of each year, the owner of a release site shall submit the contents of the daily harvest log to the department via TWIMS or other format authorized by the department. (4) Release site status cannot be altered by the sale or subdivision of a property to a related party if the purpose of the sale or subdivision is to avoid the requirements of this division. (5) The owner of a release site agrees, by consenting to the release of breeder deer on the release site, to submit all required CWD test results to the department as soon as possible but not later than May 1 of each year. Failure to comply with this paragraph will result in the release site being declared ineligible to be a destination for future releases. (6) No person may intentionally cause or allow any live deer to leave or escape from a release site. (b) Types of Release Sites. (1) Class I. (A) A release site is a Class I release site if it: There are no testing requirements for a Class I release site. (B) (i) (ii) (2) Class II. is not a Tier 1 facility; and receives breeder deer only from TC 1 facilities. (A) A release site is a Class II release site if it: (i) (ii) (iii) is not a Tier 1 facility; receives any breeder deer from TC 2 facility; and receives no deer from a TC 3 facility. (B) The landowner of a Class II release site must obtain valid CWD test results for one of the following values, whichever represents the lowest number of deer tested: (i) if deer are hunter-harvested, a number of deer equivalent to 50 percent of the number of breeder deer released at the site between the last day of lawful deer hunting at the site in the previous year and the last day of lawful deer hunting at the site in the current year; or (ii) 50 percent of all hunter-harvested deer. (C) If any hunter-harvested deer were breeder deer released between the last day of lawful deer hunting at the site in the previous year and the last day of lawful deer hunting at the site in the current, 50 percent of those hunter-harvested deer must be submitted for CWD testing, which may be counted to satisfy the requirements of subparagraph (B) of this paragraph. (3) Class III. (A) (i) (ii) is a TC 3 facility. A release site is a Class III release site if: it is a Tier 1 facility; or it receives deer from an originating facility that (B) The landowner of a Class III release site must obtain valid CWD test results for one of the following values, whichever represents the greatest number of deer tested: (i) 100 percent of all hunter-harvested deer; or (ii) one hunter-harvested deer per breeder deer released between the last day of lawful deer hunting at the site in the previous year and the last day of lawful deer hunting at the site in the current year. Filed with the Office of the Secretary of State on September 21, TRD-201503928 Ann Bright General Counsel Texas Parks and Wildlife Department For further information, please call: (512) 389-4775 TITLE 34. PUBLIC FINANCE PROPOSED RULES October 2, 2015 40 TexReg 6869

PART 1. COMPTROLLER OF PUBLIC ACCOUNTS CHAPTER 3. TAX ADMINISTRATION SUBCHAPTER O. STATE AND LOCAL SALES AND USE TAXES 34 TAC 3.340 The Comptroller of Public Accounts proposes new 3.340, concerning qualified research. This section implements House Bill 800, 83rd Legislature, 2013, which amended Tax Code, Chapter 151, to add new 151.3182 (Certain Property Used in Research and Development Activities; Reporting of Estimates and Evaluation), relating to a sales and use tax exemption and a franchise tax credit related to certain research and development activities. House Bill 800 took effect January 1, 2014. Subsection (a) addresses definitions. Paragraph (1) provides the definition of the term "combined group" as provided by 3.590 of this title (relating to Margin: Combined Reporting). Paragraph (2) defines the term "directly used in qualified research" to specify that items used for activities other than qualified research are not directly used in qualified research. Paragraph (3) defines the term "franchise tax research and development activities credit," which refers to the credit against franchise tax for certain research and development activities that was also enacted by House Bill 800. The definition of the term "Internal Revenue Code," provided in paragraph (4), is taken from new Tax Code, 151.3182(a). The definition of the term "qualified research" in paragraph (5) is derived from and includes reference to Internal Revenue Code, 41. Paragraph (6) provides a definition for the term "registrant." Paragraph (7) defines the term "registration number." The term "taxable entity" is defined in paragraph (8) by reference to Tax Code, 171.0002 (Definition of Taxable Entity). Subsection (b)(1) explains the scope of the sales and use tax exemption for depreciable tangible personal property used in qualified research and development activities. Paragraph (2) provides that a person may not claim the exemption if that person will claim a research and development activities credit against its franchise tax liability for the same period. Paragraph (3) specifies that a claim for a carryforward of an unused franchise tax research and development activities credit does not affect a person's ability to claim the sales tax exemption for tangible personal property directly used in qualified research. Subsection (c) explains the process for claiming the exemption described in subsection (b). To claim an exemption under this section, a person must register with the comptroller for a Texas Qualified Research Registration Number. The comptroller is establishing the registration process as a means of collecting the data and information necessary to perform the evaluation of the exemption for property used in qualified research that is required by Tax Code, 151.3182(c). Paragraph (1) explains the registration process. Paragraph (2) addresses retroactive registration, and explains that the comptroller may agree to make a registration number valid retroactively, either to January 1, 2014, or to a date requested by a registrant that is no more than four years prior to the date the registration is received, whichever is later. Paragraph (3) explains that a registrant must submit an annual information report for each year that its registration number is effective. This requirement for annual reporting is authorized by Tax Code, 151.3182(d). Paragraph (4) addresses the responsibilities of direct payment permit holders seeking an exemption under this section. This subsection also addresses in paragraphs (5), (6), and (7), respectively, when the comptroller will revoke a Registration Number, the effect of that revocation, and the means by which a registrant may have a registration number reinstated. Finally, paragraph (8) of this subsection explains that a registrant who has received a registration number and subsequently chooses to claim the franchise tax research and development activities credit for the same period must first cancel the registration number and remit all applicable sales and use tax due on property purchased tax-free under this section, as well as penalty and interest on such tax from the date of purchase. Subsection (d) addresses exemption certificates. Beginning January 1, 2014, a retailer may accept Form 01-931, Texas Qualified Research Sales and Use Tax Exemption Certificate, in lieu of sales and use tax on the sale of tangible personal property exempted under this section, provided the exemption certificate bears the registration number issued to the registrant and the signature of the registrant or the registrant's authorized agent. This subsection also explains the requirements of 3.287 of this title (relating to Exemption Certificates) apply to Texas Qualified Research Sales and Use Tax Exemption Certificates. Subsection (e) addresses the divergent use of property purchased under a valid Texas Qualified Research Sales and Use Tax Exemption Certificate. Tax is due on items purchased with an exemption certificate that are subsequently used in a taxable manner. Registrants making a divergent taxable use of research and development items must remit tax under the provisions of Tax Code, 151.155 (Exemption Certificate). Subsection (f) addresses refunds, and explains that a registrant with a valid registration number may file a claim for refund in accordance with the requirements of 3.325 of this title (relating to Refunds and Payments Under Protest). Subsection (g) identifies the expiration date for the exemption as provided by Tax Code, 151.3182(f). Tom Currah, Chief Revenue Estimator, has determined that for the first five-year period the rule will be in effect, there will be no significant revenue impact on the state or units of local government. Mr. Currah also has determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be by providing detailed information to businesses subject to the sales and use tax exemption provided by Tax Code, 151.3182. This rule is proposed under Tax Code, Title 2, and does not require a statement of fiscal implications for small businesses. There is no significant anticipated economic cost to individuals who are required to comply with the proposed rule. Comments on the proposal may be submitted to Teresa G. Bostick, Director, Tax Policy Division, P.O. Box 13528, Austin, Texas 78711-3528. Comments must be received no later than 30 days from the date of publication of the proposal in the Texas Register. This new section is proposed under Tax Code, 111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of Tax Code, Title 2. The section implements Tax Code, 151.3182 (Certain Property Used in Research and Development Activities). 40 TexReg 6870 October 2, 2015 Texas Register

3.340. Qualified Research. (a) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise. (1) Combined group--taxable entities that are part of an affiliated group engaged in a unitary business and that are required to file a combined group report under Tax Code, 171.1014. (A) A combined group may not include a taxable entity that conducts business outside the United States if 80% or more of the taxable entity's property and payroll are assigned to locations outside the United States. If either the property factor or payroll factor is zero, the denominator is one. For example, if Corporation Z has no property, but does have payroll located entirely outside the United States, Corporation Z will not be included in the combined group. The combined group may not include a taxable entity that conducts business outside the United States and has no property or payroll if 80% or more of the taxable entity's gross receipts are assigned to locations outside the United States. See Tax Code, 171.1014. (B) A combined group may not include an exempt entity. (C) A combined group must include eligible entities even if those entities do not have nexus as described in 3.586 of this title (relating to Margin: Nexus). (D) Eligible pass-through entities including partnerships, limited liability companies taxed as partnerships under federal law, limited liability companies that are disregarded under federal law and S corporations are included in a combined group. (E) Passive entities are not included in the combined group; however, the pro rata share of net income from a passive entity shall be included in total revenue to the extent it was not generated by the margin of another taxable entity. (2) Directly used in qualified research--having an immediate use in qualified research activity, without an intervening or ancillary use. (3) Franchise tax research and development activities credit--a credit against franchise tax for qualified research activities that is allowed under Tax Code, Chapter 171, Subchapter M (Tax Credit for Certain Research and Development Activities). (4) Internal Revenue Code--The Internal Revenue Code of 1986 in effect on December 31, 2011, excluding any changes made by federal law after that date, but including any regulations adopted under the code applicable to the tax year to which the provisions of the code in effect on that date applied. (5) Qualified research--this term has the meaning given in Internal Revenue Code, 41. (A) Qualified research means research undertaken for discovering information that is technological in nature, and its application must be intended for use in developing a new or improved business component of the person undertaking the research. Substantially all of the activities of the research must be elements of a process of experimentation relating to a new or improved function, performance, reliability, or quality. activities: (B) Qualified research does not include the following (i) research related to style, taste, cosmetic or seasonal design factors; (ii) research conducted after the beginning of commercial production of the business component; (iii) research adapting an existing product or process to a particular customer's need; research relating to certain internal-use computer software; (iv) duplication of an existing product or process; (v) surveys or studies; (vi) (vii) research conducted outside the United States, Puerto Rico, or a U.S. possession; (viii) research in the social sciences, arts, or humanities; or (ix) research funded by another person or governmental entity. (6) Registrant--A person who holds a Texas Qualified Research Registration Number issued by the comptroller. (7) Registration number--the Texas Qualified Research Registration Number issued by the comptroller to a person who submits the Texas Registration for Qualified Research and Development Sales Tax Exemption form. (8) Taxable entity--this term has the meaning given by Tax Code, 171.0002 (Definition of Taxable Entity). (b) research. Depreciable tangible personal property used in qualified (1) Subject to paragraph (2) of this subsection, the sale, storage, or use of tangible personal property is exempt from Texas sales and use tax if the property: (A) has a useful life that exceeds one year; (B) (i) is subject to depreciation under: generally accepted accounting principles; or (ii) Internal Revenue Code, 167 or 168 of 1986, in effect on December 31, 2011; and (C) is sold, leased, rented to, or used or stored by a person engaged in qualified research; and (D) is directly used in qualified research. Depreciable tangible personal property is directly used in qualified research if it is used in the actual performance of activities that are part of the qualified research. For example, machinery, equipment, computers, software, tools, laboratory furniture such as desks, laboratory tables, stools, benches, and storage cabinets, and other tangible personal property used by personnel in the process of experimentation are directly used in qualified research. Tangible personal property is not directly used in qualified research if it is used in ancillary or support activities such as administration, maintenance, marketing, distribution, or transportation activities, or if it is used in activities excluded from qualified research. For example, machinery and equipment used by administrative, accounting, or clerical personnel are not directly used in qualified research. (2) A person may not claim the exemption if that person will, as a taxable entity or as a member of a combined group, claim a franchise tax research and development activities credit on a franchise tax report based on the accounting period during which the depreciable tangible personal property used in qualified research would first be subject to Texas sales or use tax. PROPOSED RULES October 2, 2015 40 TexReg 6871

(3) A claim for a carryforward of an unused franchise tax research and development activities credit under Tax Code, 171.659 does not affect a person's ability, as a taxable entity or as a member of a combined group, to claim the sales and use tax exemption provided by paragraph (1) of this subsection. (c) Texas Qualified Research and Development Exemption Registration. In order to claim an exemption under this section, a person must first register with the comptroller and obtain a registration number. (1) Registration procedure. To obtain a registration number, a person must complete Form AP-234, Texas Registration for Qualified Research and Development Sales Tax Exemption, its electronic equivalent, or any form promulgated by the comptroller that succeeds such form. (A) The person requesting the registration number must certify that it will not, as a taxable entity or as a member of a combined group, claim a franchise tax research and development activities credit on a franchise tax report based on an accounting period during which it claims an exemption under subsection (b) of this section. (B) The person requesting the registration number must provide all data and information required by the comptroller to administer the exemption and comply with Tax Code, 151.3182(c). (2) Retroactive registration. A person may request that a registration number be given retroactive effect. (A) A person may request that a registration number have retroactive effect by submitting a registration as required under paragraph (1) of this subsection and by completing an annual information report, described in paragraph (3) of this subsection, for each prior year for which the registration number is to be effective. (B) The registration number may be made retroactive to the later of January 1, 2014, or a date requested by a registrant that is no more than four years prior to the date the registration is received, if the date requested is not within an accounting period during which the registrant, as a taxable entity or as a member of a combined group, claimed the franchise tax research and development activities credit. (C) A registrant who is issued a retroactive registration number may file a claim for refund of Texas sales and use tax paid on purchases made on or after the later of January 1, 2014, or the effective date of the registration number, that qualify for exemption under subsection (b) of this section, in accordance with the requirements of 3.325 of this title (relating to Refunds and Payments Under Protest). (D) A claim for a carryforward of an unused franchise tax research and development activities credit under Tax Code, 171.659 does not affect a person's ability, as a taxable entity or as a member of a combined group, to request a retroactive registration. (3) Annual information report. A registrant must submit an annual information report for each calendar year its registration number is effective, irrespective of the date on which the original registration occurred. (A) The registrant must provide all data and information required by the comptroller to administer the exemption and comply with Tax Code, 151.3182(c). (B) The annual information report must be submitted electronically unless the comptroller issues a waiver. A registrant who cannot comply with this requirement due to hardship, impracticality, or other valid reason must submit a written request to the comptroller for a waiver of the requirement. (C) The due date for the annual information report for the preceding calendar year is March 31. If March 31 falls on a Saturday, Sunday, or a legal holiday, the due date is the next business day. (i) An annual information report filed electronically must be completed and submitted by 11:59 p.m. central time on the due date to be considered timely. (ii) Reports submitted on paper must be postmarked on or before the due date to be considered timely. (D) A registrant who fails to timely file an annual information report for its registration number will be given written notice of the failure to file. If an annual information report is not submitted within 60 days of the date of the notice of failure to file, the registration number will be cancelled by the comptroller in accordance with paragraph (5) of this subsection. (4) Direct payment permit holders. A direct payment permit holder must obtain a registration number as required by paragraph (1) of this subsection in order to claim an exemption under this section. A direct payment permit holder with a registration number must file an annual information report for each year the number is effective as required by paragraph (3) of this subsection. (5) Cancellation of registration number by the comptroller. The comptroller will cancel the registration number of a registrant who fails to comply with the provisions of this section. For example, the comptroller will cancel the registration number of a registrant who fails to file an annual information report or who claims the franchise tax research and development activities credit without first cancelling its registration number, as required by paragraph (8) of this subsection. The comptroller shall give written notice of the cancellation to the registrant. The notice may be personally served on the registrant or sent by regular mail to the registrant's address as shown in the comptroller's records. The former registrant may not claim an exemption under this section during the period when the registration number is cancelled. A former registrant that purchases an item under a cancelled registration number may be subject to a criminal penalty under Tax Code, 151.707 and 3.287(d)(3) of this title (relating to Exemption Certificates). (6) Effective date of cancellation. A registrant whose registration number is cancelled by the comptroller is responsible for remitting Texas sales and use tax, and penalty and interest from the date of purchase, on any items purchased tax-free pursuant to Tax Code, 151.3182 on or after the effective date of cancellation. In the case of a registrant whose registration number is cancelled because the registrant, as a taxable entity or as a member of a combined group, claimed the franchise tax research and development activities credit, the effective date of cancellation is the beginning date of the accounting period covered by the franchise tax report on which the credit was claimed. (7) Reinstatement following cancellation. A former registrant who has had its registration number cancelled by the comptroller may submit a request in writing to have the registration number reinstated. (A) A former registrant whose registration number has been cancelled may request reinstatement of the number be given retroactive effect. The registrant must file an annual information report for each prior year for which the registration number is to be effective. (B) A registration number will not be reinstated for periods during which the former registrant is not eligible for the exemption under this section. (C) Before the comptroller will reinstate a registration number, the former registrant must remit any Texas sales and use taxes, as well as applicable penalties and interest from the date of purchase, 40 TexReg 6872 October 2, 2015 Texas Register

on all purchases made tax-free under this section during periods when the registrant was not eligible for the exemption under this section. (8) Cancellation of registration number by registrant. A registrant who has received a registration number and subsequently chooses to claim the franchise tax research and development activities credit must cancel the registration number. The registrant is responsible for remitting Texas sales and use tax, and penalty and interest from the date of purchase, on any items purchased tax-free under this section during any accounting periods covered by a franchise tax report on which the credit is claimed. (d) Texas Qualified Research Sales and Use Tax Exemption Certificate. Beginning January 1, 2014, a retailer may accept a valid and complete Form 01-931, Texas Qualified Research Sales and Use Tax Exemption Certificate or any form promulgated by the comptroller or that succeeds such form, in lieu of Texas sales and use tax on the sale of depreciable tangible personal property that qualifies for exemption under subsection (b) of this section. To be valid and complete, a Texas Qualified Research Sales and Use Tax Exemption Certificate must bear the registration number issued to the registrant by the comptroller and must be signed by the registrant or the registrant's authorized agent. Texas Qualified Research Sales and Use Tax Exemption Certificates are subject to the requirements of 3.287(d) of this title. A retailer must maintain a copy of the Texas Qualified Research Sales and Use Tax Exemption Certificate accepted in lieu of tax on a sale and all records supporting that transaction. Refer to 3.281 of this title (relating to Records Required; Information Required). (e) Divergent use. When a registrant uses an item purchased under a valid Texas Qualified Research Sale and Use Tax Exemption Certificate in a taxable manner, the registrant is liable for payment of Texas sales and use tax, plus penalty and interest as applicable, based on the fair market rental value of the tangible personal property for the period of time used in the taxable manner. Refer to Tax Code, 151.155 (Exemption Certificate). (f) Refund of Texas sales and use tax paid on depreciable tangible personal property used in qualified research. A registrant with a valid registration number may file a claim for refund of Texas sales and use tax paid on purchases made on or after the later of January 1, 2014, or the effective date of the registration number, that qualify for exemption under subsection (b) of this section in accordance with the requirements of 3.325 of this title. (g) Expiration. The sales and use tax exemption for depreciable tangible personal property used in qualified research expires on December 31, 2026. Filed with the Office of the Secretary of State on September 21, TRD-201503906 Lita Gonzalez General Counsel Comptroller of Public Accounts For further information, please call: (512) 475-0387 CHAPTER 19. STATE ENERGY CONSERVATION OFFICE SUBCHAPTER A. GENERAL PROVISIONS 34 TAC 19.2 The Comptroller of Public Accounts proposes an amendment to 19.2, concerning state energy conservation office business location and mailing address. The amendment updates SECO's physical address. Tom Currah, Chief Revenue Estimator, has determined that for the first five-year period the rule will be in effect, there will be no significant revenue impact on the state or units of local government. Mr. Currah also has determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be by conforming SECO rules to current law and to current energy performance standards. The proposed amendment would have no fiscal impact on small businesses. There is no significant anticipated economic cost to individuals who are required to comply with the proposed rule. Comments on the proposal may be submitted to Dub Taylor, Director, State Energy Conservation Office, at SECORuleComments@cpa.texas.gov or at P.O. Box 13528, Austin, Texas 78711. Comments must be received no later than 30 days from the date of publication of the proposal in the Texas Register. The amendment is proposed under Government Code, 447.002(b), which authorizes SECO to "establish procedures and adopt rules relating to the development and implementation of energy and water conservation measures and programs applicable to state buildings and facilities." The amendment implements Government Code, Chapter 447, regarding the State Energy Conservation Office. 19.2. State Energy Conservation Office Business Location and Mailing Address. The business office of the State Energy Conservation Office (SECO) is located at Lyndon Baines Johnson (LBJ) State Office Building, 111 E. 17th Street, [Suite 1114,] Austin, Texas 78774. The mailing address for SECO is: State Energy Conservation Office, Comptroller of Public Accounts, P.O. Box 13528, Austin, Texas 78711-3528. Filed with the Office of the Secretary of State on September 16, TRD-201503787 Lita Gonzalez General Counsel Comptroller of Public Accounts For further information, please call: (512) 475-0387 SUBCHAPTER B. STATE FACILITY ENERGY AND WATER MANAGEMENT 34 TAC 19.12-19.14, 19.16, 19.17 PROPOSED RULES October 2, 2015 40 TexReg 6873

The Comptroller of Public Accounts proposes amendments to 19.12, concerning application; 19.13, concerning definitions; 19.14, concerning utility management planning; 19.16, concerning long range utility services plan; and 19.17, concerning utility bill review. The proposed amendment to 19.12 implements the requirements of Government Code, 447.009 regarding energy and water management planning and reporting by clarifying the responsibilities and reporting requirements for Providing Agencies and Tenant Agencies. The proposed amendment to 19.13 updates the definitions to reflect changes made in other sections of Chapter 19. The proposed amendment adds the definitions of "Energy and Water Management Plan," "Providing agency," "SECO," "Tenant agency," and "Utility consumption data," and removes definitions that are no longer used in this chapter. The proposed amendment to 19.14 implements the requirements of Government Code, 447.009 regarding energy and water management planning and reporting by renaming this section as "Energy and Water Management Plan," replacing the "Resource Efficiency Plan" with the "Energy and Water Management Plan," and outlining the submission and implementation requirements for the plan. The proposed amendment to 19.16 implements the requirements of Government Code, 447.009 regarding energy and water management planning and reporting by removing the requirement to submit the Long Range Utility Services Plan to the State Energy Conservation Office (SECO) and requiring SECO to post guidelines for the plan on its website. It also removes duplicative language by deleting the term "State Energy Conservation Office." The proposed amendment to 19.17 implements the requirements of Government Code, 447.009 regarding energy and water management planning and reporting by requiring agencies to report utility consumption data, and directing agencies and institutions to prepare and submit the data in accordance with the guidelines located on SECO's website by October 1 of each year. The amendment also removes the requirement that "each state agency or institution of higher education review and audit utility billings and contracts to detect billing errors" because this requirement is already stated in Government Code, 447.007(c). The amendment also renames the section "Utility Consumption Data Reporting." Tom Currah, Chief Revenue Estimator, has determined that for the first five-year period the rule will be in effect, there will be no significant revenue impact on the state or units of local government. Mr. Currah also has determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be conforming SECO rules to current law and to current energy performance standards. The proposed amendment would have no fiscal impact on small businesses. There is no significant anticipated economic cost to individuals who are required to comply with the proposed rule. Comments on the proposal may be submitted to Dub Taylor, Director, State Energy Conservation Office, at SECORuleComments@cpa.texas.gov or at P.O. Box 13528, Austin, Texas 78711. Comments must be received no later than 30 days from the date of publication of the proposal in the Texas Register. The amendments are proposed under Government Code, 447.002(b), which authorizes SECO to "establish procedures and adopt rules relating to the development and implementation of energy and water conservation measures and programs applicable to state buildings and facilities." The amendments implement Government Code, Chapter 447 (State Energy Conservation Office). 19.12. Application. (a) These [Unless specified otherwise, these] rules apply [generally] to all state agencies and institutions of higher education [that occupy state-owned buildings or that otherwise incur utility costs]. (b) Providing agency reporting requirements. A state agency or institution of higher education that occupies or manages a stateowned building and is responsible for the provision of utilities shall: [Responsibilities of state agencies. All state agencies that occupy stateowned buildings are required to develop a Resource Efficiency Plan.] (1) have the primary responsibility for development and implementation of an Energy and Water Management Plan; [State agencies responsible for provision of utilities. A state agency that is responsible for the provision of utilities that are used in buildings or facilities of other state agencies shall have the primary responsibility for development and implementation of the Resource Efficiency Plan, with the assistance of the using agency.] (2) develop a Long Range Utility Services Plan; and [Using agencies. Any state agency that occupies space in a state-owned building to which a managing state agency provides the utility service shall develop a Resource Efficiency Plan, tailored to the using agency's unique situation. The using agency shall assist and support the managing agency in the preparation and implementation of the managing agency's Resource Efficiency Plan. The using agency shall coordinate its Resource Efficiency Plan with the managing agency. The using agency shall cooperate with SECO and the managing agency to address utility management in the building.] (3) report utility consumption data to SECO. [Leased space. A state agency that occupies a building that the state does not own shall develop a Resource Efficiency Plan, tailored to the unique situation of the lessee, and shall cooperate with SECO in addressing the utility management of that leased space. This cooperation shall include taking actions to affect energy and water use and employee behavior to the extent that such actions can result in savings in utility related lease costs. A state agency that occupies non-state owned buildings shall prepare the Utility Awareness Plan that is described in 19.14(c)(5) of this title (relating to Utility Management Planning) and update the plan as required.] (c) Tenant agency reporting requirements. A state agency or institution of higher education that occupies a building managed by another party and is not responsible for building renovation projects shall: [Responsibilities of institutions of higher education.] (1) develop an Energy and Water Management Plan; [State funded facilities. An institution of higher education that occupies a state-owned building shall develop a Resource Efficiency Plan for its state funded facilities.] (2) if the tenant agency occupies space of a providing agency, provide assistance in developing the Energy and Water Management Plan of the providing agency; and [Non-state funded (auxiliary) facilities. An institution of higher education may ask SECO for technical guidance to assist any of the institution's auxiliary enterprises in utility management to the extent that the assistance may result in a public benefit.] 40 TexReg 6874 October 2, 2015 Texas Register

(3) if the tenant agency has access to utility consumption data, report the utility consumption data to SECO. [Leased space. An institution of higher education that occupies a building that the state does not own shall cooperate with SECO in addressing the utility management of the leased space. This cooperation shall include taking actions to affect energy and water use and user behavior to the extent that such actions can result in savings in utility related lease costs. An institution of higher education that occupies non-state owned buildings shall prepare the Utility Awareness Plan that is described in 19.14(c)(5) of this title (relating to Utility Management Planning) and update the plan as required.] 19.13. Definitions. The following words and terms, when used in this chapter shall have the following meanings, unless the context clearly indicates otherwise. (1) Energy and Water Management Plan--A comprehensive plan prepared by a state agency or institution of higher education that includes a progress report of utility reduction measures, goals for reducing utility consumption, a strategy and implementation schedule, a description of methods of financing improvements, and an employee awareness plan. [Available funding--any funds that are appropriated for utility efficiency improvements or related capital upgrades, repairs, maintenance, and operations of utility systems; funds that would ordinarily be allocated to pay for utility expenses; and funding from a financing method that is prescribed by Government Code, 2166.406.] [(2) Comprehensive project--all utility related facility and operational improvements which, when considered together, can cost effectively be implemented at one time.] [(3) Cost effective measure--efficiency measures that individually or as a group create measurable and verifiable utility cost savings that are at least as great as their cost within their useful life, not to exceed 15 years.] [(4) Five-year Energy Management Plan--A comprehensive plan that consists of a Resource Efficiency Plan and a Long Range Utility Services Plan.] (2) [(5)] Institution of higher education--has the meaning that is assigned by Education Code, 61.003. (3) Providing agency--a state agency or institution of higher education that occupies or manages a state-owned building and is responsible for paying utility bills. (4) SECO--The Comptroller of Public Accounts State Energy Conservation Office or legally designated successor. [(6) Managing state agency--a state agency that is responsible for the provision of utilities used in the buildings or facilities of other state agencies.] [(7) Preliminary Energy Audit--An overview of facility energy and water use including an examination of utility bills conducted during a walk through of the facility and brief interviews of agency facility personnel designed to identify potential cost effective energy and water conservation measures.] [(8) Resource efficiency measure--any cost effective measure that is designed to reduce utility consumption costs and related operating costs of governmental facilities.] [(9) Resource Efficiency Plan--A comprehensive biennial plan that a state agency or institution of higher education prepares and that identifies potential cost effective measures for minimizing utility consumption and costs in all agency facilities and buildings, along with implementation schedules and methods of financing the measures as outlined in this chapter.] [(10) Resource Efficiency Plan completion certification document--a document submitted by a state agency or institution of higher education to the State Energy Conservation Office (SECO), in a format specified by SECO, indicating that the agency or institution has completed or updated its Resource Efficiency Plan, and the Plan is available for review by SECO.] (5) [(11)] State agency--any department, commission, board, office, or other agency in the executive, judicial, or legislative branch of state government that exists under the constitution or a statute of this state and that has authority that is not limited to a geographical portion of the state. (6) Tenant agency--a state agency or institution of higher education that occupies a building managed by another party and is not responsible for building renovation projects. A tenant agency may or may not be responsible for directly paying utility bills. [(12) Using agency--an instrumentality of the state that occupies and uses a state-owned building or facility that another state agency manages.] (7) [(13)] Utility--Electricity, gas, thermal, or other energy resource, water, and wastewater. (8) Utility consumption data--the measured amount of the agency's or institution's water, electricity, gasoline, or natural gas usage. [(14) Utility Assessment Report--A detailed assessment of utility and utility related operational efficiency that is prepared by, or under the supervision of, a person who is registered as a professional engineer under the Texas Engineering Practice Act, and which identifies each of the cost effective utility and utility related operational efficiency measures or practices that apply to the buildings or facilities of a state agency or institution of higher education as required by this chapter.] 19.14. Energy and Water [Utility] Management Plan [Planning]. (a) Requirements [Plan requirement]. The head of a state agency or an institution of higher education [as outlined in 19.12 of this title (relating to Application)] shall prepare an Energy and Water Management [ensure preparation of a Resource Efficiency] Plan and submit the plan to SECO [the State Energy Conservation Office a certification document that the plan has been completed]. (b) Guidelines. The Energy and Water Management Plan shall be prepared in accordance with the guidelines located on the SECO website, which are herein adopted by reference. (c) [(b)] Submission [date]. The Energy and Water Management [Resource Efficiency] Plan [completion certification document] shall be updated and submitted by October 31 of each [even numbered] year to SECO.Reporting@cpa.texas.gov [beginning October 31, 2002]. [(c) Contents of plan. The Resource Efficiency Plan shall include, at a minimum, the following:] [(1) a summary of the overall strategy and goals for addressing utility use at state-owned buildings or facilities;] [(2) a Utility Assessment Report (UAR) or a Preliminary Energy Audit (PEA) for a representative number of the state-owned buildings or facilities that the state agency or institution of higher education occupies, and a projected schedule that outlines the plans for completion of a UAR or PEA for all the remaining state-owned buildings or facilities that the agency or institution occupies. The UAR or PEA should detail recommendations for cost effective resource effi- PROPOSED RULES October 2, 2015 40 TexReg 6875

ciency measures that could be implemented to reduce utility consumption and/or utility costs;] [(3) an Implementation Schedule that describes how the agency or institution plans to achieve the agency established goals and implement the recommended cost effective resource efficiency measures that are identified in the UAR or PEA, and a strategy for monitoring the status of implementation of the Resource Efficiency Plan;] [(4) a Finance Strategy that describes how the agency or institution plans to obtain funding for the recommended cost effective efficiency measures;] [(5) a Utility Awareness Plan through which the agency or institution will educate its personnel on utility conservation methods and practices;] [(6) an Asset Management Inventory that describes the agency's or institution's buildings or facilities, in a format that SECO prescribes;] [(7) a two-year history of utility use and expenditures for the buildings and facilities that are identified in the Asset Management Inventory, in a format that SECO prescribes, including, without limitation, the rates for utilities that are charged to, and the amount of utilities that are used by, the agency or institution.] [(8) a Savings Monitoring and Evaluation Plan that describes the plans for monitoring and evaluating utility efficiency savings as a result of implementation of the recommendations in the UAR;] [(9) a Project Implementation Update that outlines the progress over the previous two years in implementation of the recommendations that are contained in the previous Resource Efficiency Plan, including a summary of the results of the projects in terms of utility efficiency and cost savings;] [(10) the name and address of the designated official at the agency or institution who is responsible for implementation of the recommendations in the Resource Efficiency Plan, and the name and address of an agency or institution contact person for the Resource Efficiency Plan;] [(11) any Resource Efficiency Plans that using agencies have prepared.] (d) Implementation. A state agency or institution of higher education shall implement the cost effective utility conservation measures in accordance with the timelines and recommendations that are contained in the agency's or institution's Energy and Water Management Plan. To the extent feasible, utility and utility-related operational improvements that are made to each building or facility shall be implemented through comprehensive projects. [The plan for a using agency or for an agency that leases space shall include only those provisions of subsection (c) of this section that apply to the occupying agency's situation.] [(e) After the deadline for completing or updating a Resource Efficiency Plan has passed, SECO may require a state agency or institution of higher education to submit its Resource Efficiency Plan to SECO for review. The Resource Efficiency Plan shall be submitted to SECO within 30 days of receiving a request from SECO to submit the plan.] 19.16. Long Range Utility Services Plan. (a) Requirement. A state agency or institution of higher education that purchases utilities shall prepare [and submit to the State Energy Conservation Office (SECO)] a long range plan for the delivery of reliable, cost-effective utility services for the agency or institution. [This plan may be submitted in conjunction with, or as part of, the Resource Efficiency Plan. The agency or institution shall update the Long Range Utility Services Plan at least every five years to support five-year construction and major renovation planning.] (b) Guidelines. SECO shall post guidelines for the Long Range Utility Services Plan on its website. (c) Frequency. The agency or institution shall update the Long Range Utility Services Plan at least every five years to support five-year construction and major renovation planning. (d) Submission. The plan shall be submitted to SECO upon request. 19.17. Utility Consumption Data Reporting [Bill Review]. (a) Requirement. Each state agency or institution of higher education shall report utility consumption data to SECO [review and audit utility billings and contracts to detect billing errors]. (b) Guidelines. SECO shall post guidelines for utility consumption data on its website. (c) Frequency. Utility consumption data shall be submitted no later than October 31 of each year, beginning October 31, Filed with the Office of the Secretary of State on September 16, TRD-201503789 Lita Gonzalez General Counsel Comptroller of Public Accounts For further information, please call: (512) 475-0387 34 TAC 19.15, 19.18, 19.19 (Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the Comptroller of Public Accounts or in the Texas Register office, James Earl Rudder Building, 1019 Brazos Street, Austin, Texas.) The Comptroller of Public Accounts proposes the repeal of 19.15, concerning implementation of resource efficiency plan recommendations; 19.18, concerning semiannual reporting; and 19.19, concerning extension of time. The repeal of 19.15 removes the requirements relating to the Resource Efficiency Plan, which is no longer required by Government Code, 447.009. Instead, the statute replaced the Resource Efficiency Plan with the Energy and Water Management Plan, which is addressed in the proposed amendment to 19.14 of this chapter. The repeal of 19.18 removes the requirements relating to semiannual reporting, which are no longer required by the State Energy Conservation Office (SECO). The repeal of 19.19 removes the requirements relating to extension of time to submit any required plan or report, and clarifies that no extensions will be permitted since SECO has a limited amount of time after the deadline to submit this information to the legislature. 40 TexReg 6876 October 2, 2015 Texas Register

Tom Currah, Chief Revenue Estimator, has determined that for the first five-year period the repeals will be in effect, there will be no significant revenue impact on the state or units of local government. Mr. Currah also has determined that for each year of the first five years the rules are repealed, would benefit the public conforming SECO rules to current law and to current energy performance standards. The proposed repeal would have no fiscal impact on small businesses. There is no significant anticipated economic cost to individuals who are required to comply with the proposed repeal. Comments on the repeals may be submitted to Dub Taylor, Director, State Energy Conservation Office, at SECORuleComments@cpa.texas.gov or at P.O. Box 13528, Austin, Texas 78711. Comments must be received no later than 30 days from the date of publication of the proposal in the Texas Register. The repeals are proposed under Government Code, 447.002(b), which authorizes SECO to "establish procedures and adopt rules relating to the development and implementation of energy and water conservation measures and programs applicable to state buildings and facilities." The repeals implement Government Code, Chapter 447.009 (State Energy Conservation Office). 19.15. Implementation of Resource Efficiency Plan Recommendations. 19.18. Semiannual Reporting. 19.19. Extension of Time. Filed with the Office of the Secretary of State on September 16, TRD-201503788 Lita Gonzalez General Counsel Comptroller of Public Accounts For further information, please call: (512) 475-0387 SUBCHAPTER C. ENERGY CONSERVATION DESIGN STANDARDS 34 TAC 19.31-19.34 The Comptroller of Public Accounts proposes amendments to 19.31, concerning requirement to use design standards; 19.32, concerning energy and water conservation design standards; 19.33, concerning major renovation projects; and 19.34, concerning submission of certification and compliance documentation. The amendment to 19.31 removes duplicative language by deleting the term "State Energy Conservation Office." The amendment to 19.32 updates the energy conservation design standards and water conservation design standards for new construction or major renovation of existing buildings in compliance with Government Code, 447.004, which requires the State Energy Conservation Office (SECO) to establish and publish mandatory energy and water conservation design standards for state buildings or major renovation projects and to review and update the standards biennially. The amendment also clarifies that the standards apply to state agencies and institutions of higher education, and removes duplicative language by deleting the term "State Energy Conservation Office." The amendment to 19.33 clarifies major renovation projects by specifying that the implementation costs are those associated with energy and water efficiency improvements, and that the cost estimate is the engineering cost estimate. The amendment to 19.34 requires agencies and institutions to use the certification form located on SECO's website, and removes duplicative language by deleting the term "State Energy Conservation Office." Tom Currah, Chief Revenue Estimator, has determined that for the first five-year period the rule will be in effect, there will be no significant revenue impact on the state or units of local government. Mr. Currah also has determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be conforming SECO rules to current law and to current energy performance standards. The proposed amendment would have no fiscal impact on small businesses. There is no significant anticipated economic cost to individuals who are required to comply with the proposed rule. Comments on the proposals may be submitted to Dub Taylor, Director, State Energy Conservation Office, at SECORuleComments@cpa.texas.gov or at P.O. Box 13528, Austin, Texas 78711. Comments must be received no later than 30 days from the date of publication of the proposal in the Texas Register. The amendments are proposed under Government Code, 447.002(b), which authorizes SECO to "establish procedures and adopt rules relating to the development and implementation of energy and water conservation measures and programs applicable to state buildings and facilities." The amendments implement Government Code, 447.004 regarding design standards. 19.31. Requirements to Use Design Standards. Pursuant to Government Code, 447.004, state agencies and institutions of higher education shall use the energy and water conservation design standards that [the State Energy Conservation Office (]SECO[)] has adopted under this chapter, when constructing new state buildings or conducting major renovations of existing state buildings. 19.32. Energy and Water Conservation Design Standards. (a) [The State Energy Conservation Office (]SECO[)] adopts by reference the following minimum energy standards for state agencies and institutions of higher education [new construction or major renovation projects]: [(1) for any new construction or major renovation project, except low-rise residential buildings, with a design assignment made prior to September 1, 2011, the energy conservation design standard of the American Society of Heating, Refrigerating and Air Conditioning Engineers (ASHRAE)/Illuminating Engineering Society of North America (IESNA), Energy Standard for Buildings, ASHRAE/IESNA Standard 90.1-1999;] [(2) for any new construction or major renovation project of a public low rise residential buildings with a design assignment made PROPOSED RULES October 2, 2015 40 TexReg 6877

prior to June 1, 2011, the energy conservation design standard of the International Code Council as published in the International Energy Conservation Code for 2000;] (1) [(3)] for any new construction or major renovation project, except low-rise residential buildings, with a design assignment made on or after January 1, 2016 [September 1, 2011], the energy conservation design standard of the American Society of Heating, Refrigerating and Air Conditioning Engineers (ASHRAE)/Illuminating Engineering Society of North America (IESNA), Energy Standard for Buildings, ASHRAE/IESNA Standard 90.1-2013, and any errata sheet for 90.1-2013 that is published by the ASHRAE Standards Committee [90.1-2010], provided however the following buildings or structures are exempt from compliance with this section: (A) a building or structure that is listed in the State or National Register of Historic Places; (B) a building or structure that is designated as a historic property under local or state designation law or survey; (C) a building or structure that is certified as a contributing resource with a National Register listed or locally designated historic district; or (D) with an opinion or certification by the State Historic Preservation Officer or Keeper of the National Register of Historic Places, a building or structure that is eligible to be listed on the National or State Registers of Historic Places either individually or as a contributing building to a historic district; (2) [(4)] for any new construction or major renovation project of a low-rise residential building with a design assignment made on or after January 1, 2016 [June 1, 2011], the residential chapter of [the International Code Council as published in] the 2015 International Energy Conservation Code as published by the International Code Council [for 2009]. (b) Effective January 1, 2016 [September 1, 2011], SECO adopts by reference the "Water Conservation Design [Efficiency] Standards for State Buildings and Institutions of Higher Education Facilities" prepared by SECO [the Office of the Comptroller, State Energy Conservation Office] dated April 2015 [January 2011] as the water conservation design standards for any new construction or [state buildings and] major renovation project [projects]. [(c) Copies of the standards are published by the comptroller and are available at the offices of SECO, 111 E. 17th Street, LBJ State Office Building, Suite 1114, Austin, Texas 78774, where they may be viewed during normal office hours as well as on the comptroller's website www.txbuildingenergycode.com.] 19.33. Major Renovation Projects. For the purposes of this subchapter [34 TAC Chapter 19, Subchapter C], a major renovation project is a building renovation or improvement where the implementation cost associated with energy or water efficiency improvements is $2 million or more, based on the initial engineering cost estimate. 19.34. Submission of Certification and Compliance Documentation. Before beginning construction of a new state building or a major renovation project including a new building or major renovation project of a state-supported institution of higher education, a state agency or an institution of higher education shall submit to [the State Energy Conservation Office (]SECO[)] a copy of the certification by the design architect or engineer that verifies to the agency or institution that the construction or renovation complies with the standards that are established under this chapter, including engineering documentation. The certification must be completed using the certification form located on the SECO website, which is herein adopted by reference. Filed with the Office of the Secretary of State on September 16, TRD-201503791 Lita Gonzalez General Counsel Comptroller of Public Accounts For further information, please call: (512) 475-0387 SUBCHAPTER D. LOAN PROGRAM FOR ENERGY RETROFITS 34 TAC 19.41-19.45 The Comptroller of Public Accounts proposes amendments to 19.41, concerning description of program; 19.42, concerning definitions; 19.43, concerning eligibility; 19.44, concerning application and selection; and 19.45, concerning project funding and repayment. The amendment to 19.41 clarifies that water efficiency measures are eligible for LoanSTAR funding and removes duplicative language by deleting the term "State Energy Conservation Office." The amendment to 19.42 expands the definition of "building" to include not only the structure, but also the associated site where energy or water consumption takes place; clarifies the definition of "Estimated simple payback period," while specifying that interest is included in the total estimated utility cost reduction measure costs; clarifies that water efficiency measures are eligible for LoanSTAR funding by adding the word "water," and by changing references from "energy" to "utility" and from "conservation" to "cost reduction"; removes "public junior colleges" from the definition of "public sector institution" because they are included within an "institution of higher education," which is currently part of the definition of "public section institution"; clarifies that certain measures that do not save energy but can result in lower utility costs are eligible for LoanSTAR funding by changing "conservation" to "cost reduction"; adds the definitions of "Utility Assessment Report," "Utility Cost Reduction Measure" and "Utility Cost Reduction Project"; removes the definitions of terms that are no longer used in this subchapter; and removes duplicative language by deleting the term "State Energy Conservation Office." The amendment to 19.43 clarifies that water efficiency measures are eligible for LoanSTAR funding by changing references from "energy" to "utility" and from "conservation" to "cost reduction"; clarifies loan eligibility requirements by provided that the loan candidates must own and occupy the buildings where the proposed projects will take place; clarifies the types and requirements of eligible Utility Cost Reduction Measures; and provides that a Utility Assessment Report must be prepared by a State of Texas licensed professional engineer in a format that follows the LoanSTAR Program guidelines located on the SECO website, unless SECO specifically waives this requirement. 40 TexReg 6878 October 2, 2015 Texas Register

The amendment to 19.44 simplifies the fund availability notification process. The amendment to 19.45 clarifies the term for repayment of a loan; that loan disbursement is on a reimbursement basis; that the borrower will receive a Loan Repayment Schedule upon completion and acceptance of a project by SECO; and that there is no penalty for the early repayment of a loan. Tom Currah, Chief Revenue Estimator, has determined that for the first five-year period the rule will be in effect, there will be no significant revenue impact on the state or units of local government. Mr. Currah also has determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be clarifying the provisions of the LoanSTAR program. The proposed amendment would have no fiscal impact on small businesses. There is no significant anticipated economic cost to individuals who are required to comply with the proposed rule. Comments on the proposals may be submitted to Dub Taylor, Director, State Energy Conservation Office, at SECORuleComments@cpa.texas.gov or at P.O. Box 13528, Austin, Texas 78711. Comments must be received no later than 30 days from the date of publication of the proposal in the Texas Register. The amendments are proposed under Government Code, 2305.011(f), which authorizes the comptroller to "establish procedures and adopt rules as necessary to administer" the LoanSTAR program. The amendments implement Government Code, 2305.032 regarding the LoanSTAR program. 19.41. Description of Program. Under Government Code, 2305.032, [the State Energy Conservation Office (]SECO[)] administers a revolving loan program that provides loans to eligible applicants for energy and water efficiency [conservation] measures. The loan program is called the Texas LoanSTAR (Saving Taxes and Resources) Program for Public Sector Institutions. 19.42. Definitions. The following words and terms, when used in this subchapter, shall have the following meanings, unless the context clearly indicates otherwise. (1) Building--A structure and its associated site where [that consumes] energy or water consumption takes place. [(2) Energy Conservation Measure (ECM)--A commercially available energy efficient device, technique, or technology that is designed to reduce energy consumption, peak demand, and/or utility costs at an existing facility that a public sector institution owns, or to achieve similar savings from enhancements that exceed all applicable energy-related regulatory requirements in a proposed facility to be owned by such institution.] [(3) Energy Conservation Measure (ECM) project--the identification, design, installation, monitoring, and evaluation of one or more energy efficient measures that are designed to reduce energy consumption, peak demand, and/or utility cost.] (2) [(4)] Estimated simple payback period--the estimated number of years necessary for the savings from the utility cost reduction measure (UCRM) [energy savings] improvements to equal the cost of installing the improvements. The formula used in this determination is the [as determined by the formula] total estimated UCRM [energy conservation measure] costs (including audit, metering, installation, equipment, and engineering design, but excluding interest) divided by the annual estimated utility cost savings. For Energy Savings Performance Contracts only, the formula used in this determination is the total estimated UCRM costs (including audit, metering, installation, equipment, and engineering design, and interest) divided by the annual estimated utility cost savings. (3) [(5)] Facility--Any major energy or water using group of buildings in geographic proximity to each other or [and/or] a major energy or water using system that one or more public sector institutions own and occupy [or operate]. (4) [(6)] Interest rate--the percentage of the loan amount charged on an annual basis by [the State Energy Conservation Office (]SECO[)] to a borrower for the use of the LoanSTAR program proceeds. (5) [(7)] Loan agreement--the written agreement between an applicant and SECO that details all terms and requirements under which the loan is issued, including the intended use of the loan proceeds. (6) [(8)] LoanSTAR Program--The state Revolving Loan Program that SECO administers[,] and which funds Utility Cost Reduction Projects [energy conservation measures]. The program is comprised of five elements: energy and water audits, energy and water efficiency retrofits or enhancements, a revolving loan financing mechanism, program monitoring, and evaluation. (7) [(9)] Project cost--all costs that SECO determines to be directly related to the identification, design, implementation, metering, and monitoring of UCRM [an energy conservation measure]. (8) [(10)] Public sector institution--any state [department, commission, board, office, institution, facility, or other] agency; [a public junior college or] community college; [an] institution of higher education as defined in Education Code, 61.003; unit [units] of local government including a county, city, town, or [a] public [or non-profit] hospital [or health care facility]; a public school; or [a] political subdivision of the state. (9) Utility Assessment Report (UAR)--A technical report which identifies and documents energy, water, and other cost saving measures. This report must be submitted to SECO by potential LoanSTAR borrowers for financing approval. The UAR is prepared by a State of Texas licensed professional engineer. (10) Utility Cost Reduction Measure (UCRM)--A commercially available energy efficient device, technique, or technology that is designed to reduce energy consumption, peak energy demand, water consumption or utility costs at an existing facility that a public sector institution owns and occupies, and that is permanently affixed to the building or is permanently installed on the site. Retrofit measures that result from renewable energy resources are eligible UCRM. (11) Utility Cost Reduction Project--The identification, design, installation, monitoring, and evaluation of one or more energy and water efficient measures that are designed to reduce energy consumption, peak energy demand, water consumption, or utility cost. [(11) SECO--The Comptroller of Public Accounts State Energy Conservation Office or legally designated successor.] 19.43. Eligibility. [(a)] Utility Cost Reduction Projects that loan candidates propose must comply with [fulfill] the following program and eligibility requirements. PROPOSED RULES October 2, 2015 40 TexReg 6879

(1) Loan candidates must own and occupy the buildings where the proposed projects will take place. [Experimental or researchrelated technologies are not eligible for funding. Retrofit measures that result from renewable energy resources shall not be considered experimental or research related if the measure is commercially available or has a demonstrated track record of its cost-effectiveness.] [(2) Eligible measures shall have a demonstrated track record of cost-effectiveness.] [(3) Eligible measures shall be commercially available.] [(4) Each energy conservation measure must be unique in its application, location, building characteristics, and/or target audience.] (2) [(5)] Eligible [energy conservation measure] projects may include one or more of the following Utility Cost Reduction Measures: (A) indoor and outdoor lighting projects; (B) heating, ventilation, and air conditioning equipment (HVAC); (C) electrical distribution equipment; (D) building shell improvements; (E) energy management systems; (F) energy recovery systems, including systems that generate electricity on-site; (G) (H) alternate/renewable energy systems; load management devices; (I) water systems and waste water systems energy conservation measures; (J) geothermal equipment; (K) indoor and outdoor water conservation projects; (L) commissioning; and (M) [(J)] other cost-effective energy efficiency or water conservation enhancements, demand, or rate-based measures that the LoanSTAR Program has approved.[; and] [(K) incremental cost on higher energy efficient equipment for new construction.] (3) Eligible Utility Cost Reduction Measures must: (A) be permanently affixed to the building or permanently installed on the site; (B) have a demonstrated track record of cost-effectiveness; (C) be commercially available. Experimental or research-related technologies that are not commercially available are ineligible; and (D) be recommended in a Utility Assessment Report that is prepared by a State of Texas licensed professional engineer. [(b) All eligible measures must be recommended in an energy assessment report that a licensed professional engineer prepares in a format that follows the LoanSTAR Program guidelines, unless SECO specifically waives this requirement.] 19.44. Application and Selection. [(a)] Fund Availability. From time to time, [the State Energy Conservation Office (]SECO[)] may publish a Notice of Loan Fund Availability (NOLFA) [and request for applications] regarding the availability of LoanSTAR loans under this subchapter. The notice shall be published in the Texas Register or the Electronic Business Daily, and on the SECO website. [comptroller's Web site. The notice shall include:] [(1) the total of funds available for LoanSTAR loans for the application period;] [(2) the maximum amount of funds available for each loan recipient;] [(3) the interest rate to be charged to loan recipients;] [(4) eligibility criteria;] [(5) application requirements;] [(6) application evaluation criteria;] [(7) any requirements in addition to those set forth in this subchapter;] SECO;] [(8) the date by which the application must be submitted to [(9) the anticipated date of loan approvals; and] [(10) any other information or instructions necessary and appropriate for awarding the loans as determined by SECO.] [(b) Program documents. Application forms, program documents, and program guidelines shall be posted on the SECO website and, upon request, shall be provided by SECO through U.S. Mail.] [(c) Application process. To be considered for a LoanSTAR loan, an applicant shall submit to SECO an application in the form and manner as prescribed in the NOLFA.] [(d) Additional application documentation. SECO may request additional information at any time prior to funding a loan in order to effectively evaluate any application and to protect the interest of the state.] [(e) Application approval. To approve and award a LoanSTAR loan, SECO shall:] [(1) determine the eligibility of the applicant according to the criteria identified in the NOLFA and this subchapter;] [(2) review the application according to the requirements identified in the NOLFA;] [(3) in the event that the total amount of funds requested by all eligible and timely applicants exceeds the amount of funds available, evaluate and rank all eligible and timely applications according to the criteria identified in the NOLFA;] [(4) notify all applicants of SECO's decision on the applications; and] [(5) provide approved applicants a LoanSTAR loan agreement for execution that includes:] [(A) [(B) [(C) [(D) the approved loan amount;] interest rate as identified in the NOLFA;] repayment schedule;] reporting requirements; and] [(E) such other terms and conditions SECO determines to be necessary and appropriate.] 40 TexReg 6880 October 2, 2015 Texas Register

[(f) Loan execution. To receive LoanSTAR loan proceeds, an approved applicant must execute and return the loan agreement to SECO.] 19.45. Project Funding and Repayment. (a) The term of the loan shall be determined by [the State Energy Conservation Office (]SECO[)] based on the calculated simple payback period of the overall project from the Utility Assessment Report [anticipated energy and demand savings and the estimated energy conservation measure project installation schedule]. (b) SECO shall set the interest rates in an amount sufficient to recover the cost of administering the program. (c) Loan payout and repayment. (1) Loan proceeds may be used to pay for the entire cost of the retrofit project, including the cost of the energy assessment report, engineering design, construction, equipment acquisition and installation, maintenance, and metering and monitoring. (2) Loan funds shall be disbursed on a reimbursement basis after [to] the borrower provides acceptable [upon receipt of] supporting documentation that SECO requires. (3) A state agency may use general revenue funds that are appropriated for utilities to make loan payments as stipulated in Government Code, Chapter 2305. (4) The borrower shall repay the principal of and interest on the loan in accordance with the Loan Repayment Schedule that the borrower will receive upon project completion and acceptance by SECO [with payments that are not less than the amount of the energy savings estimated by the energy assessment report to result from the energy conservation measures implemented with the loan proceeds]. (5) Frequency of payments shall be no greater than quarterly, with quarterly payment dates based on the state fiscal year. (6) The borrower may repay loans early without penalty. (7) [(6)] No loans will be forgiven. (d) Loan recipient responsibilities (project monitoring). (1) Loan recipients shall provide the LoanSTAR Program with the access and information that is necessary to monitor the performance of the retrofits, as stated in the loan agreement. (2) Loan recipients shall be responsible for submission of all reports that the LoanSTAR Program requests as outlined in the loan agreement. (3) Compliance with applicable local, state, and federal procurement guidelines and procedures is the responsibility of the loan recipient. (e) Title to equipment. (1) Title to all equipment that is acquired under this program will vest in the borrower, in accordance with applicable state statutes. (2) Disposition and inventory of any equipment shall be done in accordance with state statutes and regulations. Filed with the Office of the Secretary of State on September 16, TRD-201503792 Lita Gonzalez General Counsel Comptroller of Public Accounts For further information, please call: (512) 475-0387 SUBCHAPTER E. TEXAS BUILDING ENERGY PERFORMANCE STANDARDS 34 TAC 19.52, 19.53 The Comptroller of Public Accounts proposes amendments to 19.52, concerning public comment on building energy efficiency performance standards, and 19.53, concerning building energy efficiency performance standards. The amendment to 19.52 updates the public comment period and process to implement the changes made to Health and Safety Code, 388.003 by House Bill 1736, 84th Legislature, The amendment to 19.53 updates the energy codes for residential and commercial construction in accordance with the changes made to Health and Safety Code, 388.003 in House Bill 1736, 84th Legislature, The International Residential Code, as it existed on May 1, 2015, was specifically designated by the legislature in H.B. 1736 as the state energy code for single-family residential construction. The International Energy Conservation Code, as it existed on May 1, 2015, is proposed as the state energy code for all other residential, commercial, and industrial construction, based on public comment and stringency findings of the Energy Systems Laboratory, as required by Health and Safety Code, Chapter 388. Tom Currah, Chief Revenue Estimator, has determined that for the first five-year period the rule will be in effect, there will be no significant revenue impact on the state or units of local government. Mr. Currah also has determined that for each year of the first five years the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be implementing updated building energy performance standards. The proposed amendment would have no fiscal impact on small businesses. There is no significant anticipated economic cost to individuals who are required to comply with the proposed rule. Comments on the proposals may be submitted to Dub Taylor, Director, State Energy Conservation Office, at SECORuleComments@cpa.texas.gov or at P.O. Box 13528, Austin, Texas 78711. Comments must be received no later than 30 days from the date of publication of the proposal in the Texas Register. The amendments are proposed under Health and Safety Code, 388.003, which authorizes the comptroller by rule to establish a procedure for interested persons to have an opportunity to comment on energy codes that are under consideration and to adopt energy codes, and establishes Texas building and performance standards. The amendments implement Health and Safety Code, 388.003. 19.52. Public Comment on Building Energy Efficiency Performance Standards. (a) Pursuant to Health and Safety Code, 388.003(a), following publication of a new edition [of the International Energy Conserva- PROPOSED RULES October 2, 2015 40 TexReg 6881

tion Code, or a new edition] of the International Residential Code, and not more often than every six years, [the State Energy Conservation Office (]SECO[)] will publish notice in the Texas Register and on the SECO website informing interested persons that they may provide written comments to SECO regarding [on the] new editions of the Codes. (b) Pursuant to Health and Safety Code, 388.003(b), following publication of a new edition of the International Energy Conservation Code, SECO will publish notice in the Texas Register and on the SECO website informing interested persons that they may provide written comments to SECO regarding the new editions of the Code. (c) [(b)] Comments are encouraged from any interested persons, including without limitation: commercial and residential builders; architects and engineers; municipal, county, and other local government authorities; [and] environmental groups; and manufacturers of building materials and products. (d) [(c)] Comments will be accepted for a minimum of 30 days after publication of the notice in the Texas Register or for a longer period as specified in the request for comments. (e) [(d)] Written comments should be submitted to SECO's business or mailing address specified in 19.2 of this title (relating to State Energy Conservation Office Business Location and Mailing Address), or the comments may be submitted electronically to SECO's email [electronic mail] address specified on the SECO website [SECO's web site]. (f) [(e)] SECO will forward any written comments received on the Codes pursuant to this section to the Laboratory for the Laboratory to consider in developing their written findings on the stringency of the energy efficiency chapter of the International Residential Code or the International Energy Conservation Code [recommendations]. 19.53. Building Energy Efficiency Performance Standards. (a) Single-family residential construction. Effective September 1, 2016 [January 1, 2012], the energy efficiency chapter [provisions] of the International Residential Code, as it [they] existed on May 1, 2015 [2009], is [are] adopted as the energy code in this state for single-family residential construction as it is defined in Health and Safety Code, 388.002(12). (b) All other residential, commercial, and industrial construction. Effective September 1, 2016 [April 1, 2011], the International Energy Conservation Code, as it existed on May 1, 2015 [2009], is adopted as the energy code for use in this state for all residential, commercial, and industrial construction that is not single-family residential construction under subsection (a) of this section. Filed with the Office of the Secretary of State on September 16, TRD-201503793 Lita Gonzalez General Counsel Comptroller of Public Accounts For further information, please call: (512) 475-0387 TITLE 37. PUBLIC SAFETY AND CORREC- TIONS PART 9. TEXAS COMMISSION ON JAIL STANDARDS CHAPTER 265. ADMISSION 37 TAC 265.13 The Texas Commission on Jail Standards proposes new 265.13, concerning Verify Veteran Status as required by House Bill 875, 84th Legislature. Brandon S. Wood, Executive Director, has determined that for the first five-year period the proposed rule is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the proposed rule. Mr. Wood has determined that for each year of the first five years the proposed rule is in effect the public benefits anticipated as a result of enforcing the new rule as proposed will be clarification of existing standards. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the new rule as proposed. Comments on the proposed rule may be submitted to Diana Spiller, P.O. Box 12985, Austin, Texas 78711, FAX (512) 463-3185, or e-mail at diana.spiller@tcjs.state.tx.us. The new rule is proposed under Government Code, Chapter 511, which provides the Texas Commission on Jail Standards with the authority to adopt reasonable rules and procedures establishing minimum standards for the construction, equipment, maintenance, and operation of county jails. The statutes that are affected by this proposed rule are Local Government Code, Chapter 351, 351.002 and 351.015. 265.13. Verify Veteran Status. (a) Each sheriff/operator shall investigate and verify the veteran status of each prisoner by using data made available from the Veterans Reentry Search Service (VRSS) operated by the United States Department of Veteran Affairs or similar service. (b) Each sheriff/operator shall provide assistance to prisoners identified as veterans, identified through either self-report or the VRSS, in applying for federal benefits or compensation for which the prisoners may be eligible under a program administered by the United States Department of Veterans Affairs. Assistance includes, but not limited to, direct assistance by qualified claims counselor, issuance of a referral card, or similar assistance. (c) Each sheriff shall maintain a log of positive VRSS returns with identifying prisoner number and whether a referral card was issued to the identified veteran prior to his or her release. If a referral card was not issued, a reason shall be provided on the log. Filed with the Office of the Secretary of State on September 18, TRD-201503891 Brandon Wood Executive Director Texas Commission on Jail Standards For further information, please call: (512) 463-5505 40 TexReg 6882 October 2, 2015 Texas Register

CHAPTER 273. HEALTH SERVICES 37 TAC 273.2 The Texas Commission on Jail Standards proposes to amend 273.2, concerning Health Services Plan as mandated by House Bill 1140, 84th Legislature. Brandon S. Wood, Executive Director, has determined that for the first five-year period the amended rule is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the amended rule. Mr. Wood has determined that for each year of the first five years the proposed rule is in effect the public benefits anticipated as a result of enforcing the amendment as proposed will be clarification of existing standards. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the amendment as proposed. Comments on the proposed rule may be submitted to Diana Spiller, P.O. Box 12985, Austin, Texas 78711, FAX (512) 463-3185, or e-mail at diana.spiller@tcjs.state.tx.us. The amendment is proposed under Government Code, Chapter 511, which provides the Texas Commission on Jail Standards with the authority to adopt reasonable rules and procedures establishing minimum standards for the construction, equipment, maintenance, and operation of county jails. The statutes that are affected by this amendment are Local Government Code, Chapter 351, 351.002 and 351.015. 273.2. Health Services Plan. Each facility shall have and implement a written plan, approved by the Commission, for inmate medical, mental, and dental services. The plan shall: (1) provide procedures for regularly scheduled sick calls; (2) provide procedures for referral for medical, mental, and dental services; (3) provide procedures for efficient and prompt care for acute and emergency situations; (4) provide procedures for long-term, convalescent, and care necessary for disabled inmates; (5) provide procedures for medical, mental, nutritional requirements, special housing, appropriate work assignments, and the documented use of restraints during labor, delivery and recovery for known pregnant inmates. A sheriff/operator shall notify the commission of any changes in policies and procedures in the provision of health care to pregnant prisoners. A sheriff/operator shall notify the commission of any changes in policies and procedures in the placement of a pregnant prisoner in administrative separation; (6) provide procedures for the control, distribution, secured storage, inventory, and disposal of prescriptions, syringes, needles, and hazardous waste containers; (7) provide procedures for the distribution of prescriptions in accordance with written instructions from a physician by an appropriate person designated by the sheriff/operator; (8) provide procedures for the control, distribution, and secured storage of over-the-counter medications; (9) provide procedures for the rights of inmates to refuse health care in accordance with informed consent standards for certain treatments and procedures (in the case of minors, the informed consent of a parent, guardian, or legal custodian, when required, shall be sufficient); (10) provide procedures for all examinations, treatments, and other procedures to be performed in a reasonable and dignified manner and place; and (11) provide that adequate first aid equipment and patient evacuation equipment be on hand at all times. Filed with the Office of the Secretary of State on September 18, TRD-201503892 Brandon Wood Executive Director Texas Commission on Jail Standards For further information, please call: (512) 463-5505 CHAPTER 291. SERVICES AND ACTIVITIES 37 TAC 291.4 The Texas Commission on Jail Standards proposes amendments to 291.4, concerning Visitation Plan as mandated by House Bills 549 and 634, 84th Legislature. Brandon S. Wood, Executive Director, has determined that for the first five-year period the amended rule is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the amended rule. Mr. Wood has determined that for each year of the first five years the proposed rule is in effect the public benefits anticipated as a result of enforcing the amendment as proposed will be clarification of existing standards. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the amendment as proposed. Comments on the proposed rule may be submitted to Diana Spiller, P.O. Box 12985, Austin, Texas 78711, FAX (512) 463-3185, or e-mail at diana.spiller@tcjs.state.tx.us. The amendment is proposed under Government Code, Chapter 511, which provides the Texas Commission on Jail Standards with the authority to adopt reasonable rules and procedures establishing minimum standards for the construction, equipment, maintenance, and operation of county jails. The statutes that are affected by this amendment are Local Government Code, Chapter 351, 351.002 and 351.015. 291.4. Visitation Plan. Each facility shall have and implement a written plan, approved by the commission, governing inmate visitation. The plan shall: (1) indicate frequency of visitation periods; each inmate shall be allowed a minimum of two in-person, noncontact visitation periods per week of at least 20 minutes duration each; (A) Facilities exempt from in-person visitation shall be determined by the provisions set forth in Government Code 511.009(20)(a-1). PROPOSED RULES October 2, 2015 40 TexReg 6883

(B) The requirement of in-person visitation does not remove a sheriff's/operator's authority to limit visitation for disciplinary reasons as per 37 TAC 283.1. (2) provide that at least one visitation period be allowed during evenings or weekends; (3) provide for reasonable attorney/client visitation; (4) provide procedures for the selection of visitors, including inmates' minor children. Accompaniment by parent, guardian, or legal counsel may be required. The sheriff/operator shall provide procedures regarding visitation by a guardian. The procedures shall include placement of a guardian, at the guardian's request, on the inmate's visitation list, and provide the guardian access to the inmate during regular visitation hours to an eligible inmate. A guardian's visit shall be in addition to normal visitation. The sheriff/operator shall require the guardian to provide the sheriff/operator with letters of guardianship as provided by 1002.012, 1106.001-1106.003, Estates Code, before allowing visitation with the inmate; (5) define procedures where contact visitation is permitted; (6) contain procedures for emergency visitation. Filed with the Office of the Secretary of State on September 18, TRD-201503893 Brandon Wood Executive Director Texas Commission on Jail Standards For further information, please call: (512) 463-5505 40 TexReg 6884 October 2, 2015 Texas Register