TITLE 16. ECONOMIC REGULATION

PART 4. TEXAS DEPARTMENT OF LICENSING AND REGULATION

CHAPTER 75. AIR CONDITIONING AND REFRIGERATION

16 TAC §75.100

The Texas Department of Licensing and Regulation (Department) proposes amendments to an existing rule at 16 Texas Administrative Code (TAC), Chapter 75, §75.100, regarding the Air Conditioning and Refrigeration Contractors Program. These proposed changes are referred to as the "proposed rule."

EXPLANATION OF AND JUSTIFICATION FOR THE RULES

The rules under 16 TAC Chapter 75 implement Texas Occupations Code, Chapter 1302, Air Conditioning and Refrigeration Contractors.

Pursuant to 16 TAC, Chapter 75, §75.100(a)(4), electrical work performed by air conditioning and refrigeration contractors must be performed in accordance with the 2020 National Electrical Code (NEC). Section 90.4 of the 2020 NEC authorizes the Department to waive specific code requirements when doing so will not have a negative impact on safety.

Section 210.8(F) of the NEC requires certain outdoor outlets to have ground-fault circuit-interrupter (GFCI) protection. An incompatibility between most GFCI products on the market and common air-conditioning and heating equipment has resulted in that equipment failing by persistently tripping circuit breakers. Recent rulemaking by the Department has delayed the implementation of Section 210.8(F) until January 1, 2023, in order to allow equipment manufacturers to correct this incompatibility. See 16 TAC §75.100(a)(5). However, because this incompatibility will not be resolved by January 1, 2023, the proposed rule will exclude Section 210.8(F) from the Department's implementation of the 2020 NEC altogether.

The approaching summer heat poses a serious threat to Texas residents whose air-conditioning systems have failed or are malfunctioning. Adopting the proposed rule would help keep Texas residents safe by ensuring installed air-conditioning systems are not subject to failure due to equipment incompatibility. Additionally, the Department's technical experts have confirmed that adopting the proposed rule would not have a negative impact on safety.

Advisory Board Recommendations

The proposed rules were presented to and discussed by the Air Conditioning and Refrigeration Contractors Advisory Board at its meeting on June 22, 2022. The Advisory Board did not make any changes to the proposed rules. The Advisory Board voted and recommended that the proposed rules be published in the Texas Register for public comment.

SECTION-BY-SECTION SUMMARY

The proposed rule amends §75.100(a)(5) to state that compliance with Section 210.8(F) of the 2020 NEC is not required.

FISCAL IMPACT ON STATE AND LOCAL GOVERNMENT

Tony Couvillon, Policy Research and Budget Analyst, has determined that for each year of the first five years the proposed rule is in effect, enforcing or administering the proposed rule does not have foreseeable implications relating to costs or revenues of state or local governments.

LOCAL EMPLOYMENT IMPACT STATEMENT

As Mr. Couvillon has determined that the proposed rule will not affect the local economy, the agency is not required to prepare a local employment impact statement under Government Code §2001.022.

PUBLIC BENEFITS

Mr. Couvillon also has determined that for each year of the first five-year period the proposed rule is in effect, the public benefits will be increased safety for the public and reduced costs to consumers for service calls related to inoperable equipment.

PROBABLE ECONOMIC COSTS TO PERSONS REQUIRED TO COMPLY WITH PROPOSAL

Mr. Couvillon has determined that for each year of the first five-year period the proposed rule is in effect, there are no anticipated economic costs to persons who are required to comply with the proposed rule.

FISCAL IMPACT ON SMALL BUSINESSES, MICRO-BUSINESSES, AND RURAL COMMUNITIES

There will be no adverse economic effect on small businesses, micro-businesses, or rural communities as a result of the proposed rule. Since the agency has determined that the proposed rule will have no adverse economic effect on small businesses, micro-businesses, or rural communities, preparation of an Economic Impact Statement and a Regulatory Flexibility Analysis, as detailed under Texas Government Code §2006.002, are not required.

ONE-FOR-ONE REQUIREMENT FOR RULES WITH A FISCAL IMPACT

The proposed rule does not have a fiscal note that imposes a cost on regulated persons, including another state agency, a special district, or a local government. Therefore, the agency is not required to take any further action under Government Code §2001.0045.

GOVERNMENT GROWTH IMPACT STATEMENT

Pursuant to Government Code §2001.0221, the agency provides the following Government Growth Impact Statement for the proposed rule. For each year of the first five years the proposed rule will be in effect, the agency has determined the following:

1. The proposed rule does not create or eliminate a government program.

2. Implementation of the proposed rule does not require the creation of new employee positions or the elimination of existing employee positions.

3. Implementation of the proposed rule does not require an increase or decrease in future legislative appropriations to the agency.

4. The proposed rule does not require an increase or decrease in fees paid to the agency.

5. The proposed rule does not create a new regulation.

6. The proposed rule expands, limits, or repeals an existing regulation. The proposed rule removes the applicability of Section 210.8(F) of the 2020 NEC and thus limits an existing regulation.

7. The proposed rule does not increase or decrease the number of individuals subject to the rules' applicability.

8. The proposed rule does not positively or adversely affect this state's economy.

TAKINGS IMPACT ASSESSMENT

The Department has determined that no private real property interests are affected by the proposed rule and the proposed rule does not restrict, limit, or impose a burden on an owner's rights to his or her private real property that would otherwise exist in the absence of government action. As a result, the proposed rule does not constitute a taking or require a takings impact assessment under Government Code §2007.043.

PUBLIC COMMENTS

Comments on the proposed rules may be submitted electronically on the Department's website at https://ga.tdlr.texas.gov:1443/form/gcerules; by facsimile to (512) 475-3032; or by mail to Monica Nuñez, Legal Assistant, Texas Department of Licensing and Regulation, P.O. Box 12157, Austin, Texas 78711. The deadline for comments is 30 days after publication in the Texas Register.

STATUTORY AUTHORITY

The proposed rule is proposed under Texas Occupations Code, Chapters 51 and 1302, which authorize the Texas Commission of Licensing and Regulation, the Department's governing body, to adopt rules as necessary to implement these chapters and any other law establishing a program regulated by the Department.

The statutory provisions affected by the proposed rule are those set forth in Texas Occupations Code, Chapters 51 and 1302. No other statutes, articles, or codes are affected by the proposed rule.

§75.100.Technical Requirements

(a) Electrical Connections.

(1) On new construction of environmental air conditioning, commercial refrigeration, and process cooling or heating systems, licensees may connect the appliance to the electrical line or disconnect that is provided for that purpose.

(2) Licensees may replace and reconnect environmental air conditioning, commercial refrigeration, process cooling or heating systems, or component parts of the same or lesser amperage. On replacement environmental air conditioning, commercial refrigeration, process cooling or heating systems where the electrical disconnect has not been installed and is required by the applicable National Electrical Code, the licensee may install a disconnect and reconnect the system.

(3) Control wiring of 50 volts or less may be installed and serviced by a licensee. Control wiring for commercial refrigeration equipment of any voltage may be installed by a licensee with the commercial refrigeration endorsement as long as the control wiring is on the equipment side of the disconnect installed for that purpose.

(4) All electrical work shall be performed in accordance with standards at least as strict as that established by the applicable National Electrical Code and the International Residential Code, where applicable.

(5) Notwithstanding subsection (a)(4), compliance with Section 210.8(F) of the 2020 National Electrical Code is not required [until January 1, 2023].

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on June 27, 2022.

TRD-202202404

Brad Bowman

General Counsel

Texas Department of Licensing and Regulation

Earliest possible date of adoption: August 7, 2022

For further information, please call: (512) 475-4879


CHAPTER 85. VEHICLE STORAGE FACILITIES

16 TAC §85.720, §85.721

The Texas Department of Licensing and Regulation (Department) proposes amendments to existing rules at 16 Texas Administrative Code (TAC), Chapter 85, §85.720 and §85.721, regarding the Vehicle Storage Facility (VSF) Program. These proposed changes are referred to as "proposed rules."

EXPLANATION OF AND JUSTIFICATION FOR THE RULES

The rules under 16 TAC Chapter 85 implement Texas Occupations Chapter 2303, Vehicle Storage Facility Act.

The proposed rules clarify that written consent from a vehicle owner or owner's authorized representative is required before a VSF owner or employee may repair, alter, or have parts removed or replaced from a vehicle stored at the facility.

They also amend existing rules to provide an explicit prohibition on VSF owners, employees, agents, or authorized representatives from soliciting or encouraging written consent from a vehicle owner or operator to transfer a vehicle stored at a VSF following an incident management or non-consent tow, to an unregulated entity, including a body shop, prior to a vehicle's release from the VSF. This process is known as "flipping" and often results in consumers facing unexpectedly high charges from an unregulated entity after the vehicle is transferred from a licensed VSF and torn down at an unregulated entity. The transfer and tear down at an unregulated entity typically occur prior to an insurance assessment. This, in turn, results in charges for unnecessary work.

The proposed rules are necessary to bring the VSF rules in line with the Vehicle Towing and Booting (TOW) rules at 16 TAC Chapter 86, which contain a specific prohibition on TOW licensees engaging in the practice of "flipping."

The proposed rules were drafted upon request by the Towing and Storage (TOW/VSF) Advisory Board, include input from Advisory Board members, and are an industry led initiative to explicitly ban "flipping." A TOW/VSF workgroup met on three occasions to assist in drafting the proposed rules and to prepare them for submission to the full Advisory Board. The workgroup unanimously agreed that the draft is ready for full Advisory Board consideration.

The proposed rules were presented to and discussed by the TOW/VSF Advisory Board at its meeting on June 9, 2022. The Advisory Board did not make any changes to the proposed rules. The Advisory Board voted and recommended that the proposed rules be published in the Texas Register for public comment.

SECTION-BY-SECTION SUMMARY

The proposed rules amend §85.720, by adding the word "written" to clarify that written consent from a vehicle owner or authorized representative is required before a VSF may repair, alter, or have parts removed or replaced from a vehicle stored in its facility.

The proposed rules also amend §85.721 by adding a specific prohibition on the practice of "flipping." This is done by prohibiting VSF owners, employees, representatives, or agents from soliciting or obtaining consent to transfer a vehicle stored at a VSF following an incident management or non-consent tow, to an unregulated entity prior to its release from the VSF.

It also prohibits a VSF owner, employee, representative, or agent from encouraging persons employed or affiliated with an unregulated entity to solicit or provide documentation that obtains consent from a vehicle owner or representative to repair, alter, remove, or replace parts of any vehicle stored at a licensed VSF prior to its release from the licensed facility.

FISCAL IMPACT ON STATE AND LOCAL GOVERNMENT

Tony Couvillon, Policy Research and Budget Analyst, has determined that for each year of the first five years the proposed rules are in effect, there are no estimated additional costs or reductions in costs to state or local government as a result of enforcing or administering the proposed rules.

Mr. Couvillon has determined that for each year of the first five years the proposed rules are in effect, there is no estimated increase or loss in revenue to the state or local government as a result of enforcing or administering the proposed rules.

Mr. Couvillon has determined that for each year of the first five years the proposed rules are in effect, enforcing or administering the proposed rules does not have foreseeable implications relating to costs or revenues of state or local governments.

LOCAL EMPLOYMENT IMPACT STATEMENT

Mr. Couvillon has determined that the proposed rules will not affect the local economy, so the agency is not required to prepare a local employment impact statement under Government Code §2001.022.

PUBLIC BENEFITS

Mr. Couvillon has determined that for each year of the first five-year period the proposed rules are in effect, the public benefit will be protecting a vehicle owner whose car is stored at a VSF following an incident management or other nonconsent tow from solicitations to induce the movement or transfer of a vehicle to an unregulated entity, where storage and other fees are not regulated and could be excessive. The rule also protects consumers from bearing additional costs that could be charged, as well as the charging of unclear costs imposed by unregulated entities.

PROBABLE ECONOMIC COSTS TO PERSONS REQUIRED TO COMPLY WITH PROPOSAL

Mr. Couvillon has determined that for each year of the first five-year period the proposed rules are in effect, there are no anticipated economic costs to persons who are required to comply with the proposed rules.

FISCAL IMPACT ON SMALL BUSINESSES, MICRO-BUSINESSES, AND RURAL COMMUNITIES

There will be no adverse economic effect on small businesses, micro-businesses, or rural communities as a result of the proposed rules. Since the agency has determined that the proposed rule will have no adverse economic effect on small businesses, micro-businesses, or rural communities, preparation of an Economic Impact Statement and a Regulatory Flexibility Analysis, as detailed under Texas Government Code §2006.002, are not required.

ONE-FOR-ONE REQUIREMENT FOR RULES WITH A FISCAL IMPACT

The proposed rules do not have a fiscal note that imposes a cost on regulated persons, including another state agency, a special district, or a local government. Therefore, the agency is not required to take any further action under Government Code §2001.0045.

GOVERNMENT GROWTH IMPACT STATEMENT

Pursuant to Government Code §2001.0221, the agency provides the following Government Growth Impact Statement for the proposed rules. For each year of the first five years the proposed rules will be in effect, the agency has determined the following:

1. The proposed rules do not create or eliminate a government program.

2. Implementation of the proposed rules does not require the creation of new employee positions or the elimination of existing employee positions.

3. Implementation of the proposed rules does not require an increase or decrease in future legislative appropriations to the agency.

4. The proposed rules do not require an increase or decrease in fees paid to the agency.

5. The proposed rules do not create a new regulation.

6. The proposed rule expands an existing regulation by including in the responsibilities of license holders a specific prohibition on soliciting a vehicle owner to move or transfer a vehicle stored at a VSF following an incident management or nonconsent tow, or authorizing a person employed by or affiliated with a non-regulated entity to solicit a vehicle owner regarding consent to repair or otherwise modify the vehicle.

7. The proposed rules do not increase or decrease the number of individuals subject to the rules' applicability.

8. The proposed rules do not positively or adversely affect this state's economy.

TAKINGS IMPACT ASSESSMENT

The Department has determined that no private real property interests are affected by the proposed rules and the proposed rules do not restrict, limit, or impose a burden on an owner's rights to his or her private real property that would otherwise exist in the absence of government action. As a result, the proposed rules do not constitute a taking or require a takings impact assessment under Government Code §2007.043.

PUBLIC COMMENTS

Comments on the proposed rules may be submitted electronically on the Department's website at https://ga.tdlr.texas.gov:1443/form/gcerules; by facsimile to (512) 463-7750; or by mail to Shamica Wilson, Legal Assistant, Texas Department of Licensing and Regulation, P.O. Box 12157, Austin, Texas 78711. The deadline for comments is 30 days after publication in the Texas Register.

STATUTORY AUTHORITY

The proposed rules are proposed under Texas Occupations Code, Chapters 51 and Chapter 2303, which authorize the Texas Commission of Licensing and Regulation, the Department's governing body, to adopt rules as necessary to implement these chapters and any other law establishing a program regulated by the Department.

The statutory provisions affected by the proposed rules are those set forth in Texas Occupations Code, Chapters 51 and Chapter 2303. No other statutes, articles, or codes are affected by the proposed rules.

§85.720.Responsibilities of Licensee--Repair; Alteration of Stored Vehicles Prohibited.

A vehicle accepted for storage may not be repaired, altered, or have parts removed or replaced without written consent of the vehicle owner or an owner's authorized representative.

§85.721.Responsibilities of Licensee--Vehicle Transfers.

(a) When a motor vehicle has been delivered to a VSF, the vehicle may not be moved from that facility within the first 31 days of storage without the vehicle owner's authorization. If it becomes necessary to move the vehicle during the first 31 days of storage because of VSF capacity problems, neither the registered vehicle owner nor recorded lienholder(s) may be assessed an additional charge. The VSF must send notice in accordance with these rules, except that the notice must be sent no less than 72 hours prior to moving the vehicle. If a vehicle is moved from a VSF, the licensee shall:

(1) charge only those fees otherwise permitted by §85.722 after the vehicle is towed to another location without the vehicle owner's permission;

(2) retain records and inform the vehicle owner upon request of the location where the vehicle is at all times from the date on which the vehicle is transferred from the VSF until such time as the vehicle is recovered by the vehicle owner, or a new certificate of title, a certificate of authority to demolish, a police auction sales receipt, or a transfer document is issued by the State of Texas; and

(3) maintain a record of the ultimate disposition of the vehicle, including the date and name of the person to whom the vehicle is released or a description of the document under which the vehicle was sold or demolished.

(b) A VSF, its owner, employee, representative, or agent must not:

(1) solicit a vehicle owner or representative to agree verbally or in writing to move or transfer any vehicle stored at a licensed VSF, including vehicles stored there following an incident management or nonconsent tow; or

(2) encourage or authorize a person employed by and/or affiliated with a non-regulated entity, including an auto body shop or collision repair center, to solicit or provide documentation to any vehicle owner or owner's representative that pertains to the consent to repair, alter, remove or replace parts for any vehicle stored at a licensed VSF, including vehicles stored at a VSF following an incident management or nonconsent tow.

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on June 24, 2022.

TRD-202202351

Brad Bowman

General Counsel

Texas Department of Licensing and Regulation

Earliest possible date of adoption: August 7, 2022

For further information, please call: (512) 463-7750