By: Kubiak H.B. No. 1397
73R5756 LJR-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the transfer of the regulation of perpetual care
1-3 cemeteries and the sale of prepaid funeral services and merchandise
1-4 from the banking department to the State Board of Insurance.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Section 712.001(b), Health and Safety Code, is
1-7 amended to read as follows:
1-8 (b) In this chapter:
1-9 (1) "Board" means the State Board of Insurance
1-10 <"Banking department" means the Banking Department of Texas>.
1-11 (2) "Commissioner" means the commissioner of insurance
1-12 <Banking Commissioner of Texas>.
1-13 (3) "Fund" means a cemetery perpetual care trust fund.
1-14 (4) "Trustee" means the trustee of a cemetery
1-15 perpetual care trust fund.
1-16 SECTION 2. Section 712.006(b), Health and Safety Code, is
1-17 amended to read as follows:
1-18 (b) The records and funds must be available for examination
1-19 by the board <banking department> at all times.
1-20 SECTION 3. Sections 712.042(b) and (c), Health and Safety
1-21 Code, are amended to read as follows:
1-22 (b) The <banking department shall receive and disburse>
1-23 revenues collected under this chapter shall be deposited in the
1-24 state treasury to the credit of the State Board of Insurance
2-1 operating fund <in accordance with Article 12, Chapter I, The Texas
2-2 Banking Code of 1943 (Article 342-112, Vernon's Texas Civil
2-3 Statutes),> for:
2-4 (1) the administration and enforcement of the law
2-5 relating to the operation of funds; and
2-6 (2) investigations on board <department> initiative,
2-7 or on complaints made by others, regarding the operation of a
2-8 perpetual care cemetery and the creation, investment, and
2-9 expenditure of funds.
2-10 (c) A reasonable part of the amount that the board <banking
2-11 department> transfers each year of the biennium to the general
2-12 revenue fund to cover the cost of government services rendered by
2-13 other departments may consist of revenues collected under this
2-14 chapter.
2-15 SECTION 4. Section 1, Chapter 512, Acts of the 54th
2-16 Legislature, Regular Session, 1955 (Article 548b, Vernon's Texas
2-17 Civil Statutes), is amended to read as follows:
2-18 Sec. 1. (a) In this Act:
2-19 (1) "Board" means the State Board of Insurance.
2-20 (2) "Commissioner" means the commissioner of
2-21 insurance.
2-22 (b) Any individual, firm, partnership, corporation, or
2-23 association (hereinafter called "organization" or "seller")
2-24 desiring to sell prearranged or prepaid funeral services or funeral
2-25 merchandise (including caskets, grave vaults, and all other
2-26 articles of merchandise incidental to a funeral service, but
2-27 excluding grave lots, grave spaces, grave markers, monuments,
3-1 tombstones, crypts, niches, and mausoleums), or accepting funds
3-2 for such services or merchandise, in this state, under any
3-3 contract, expressed or implied, providing for prepaid burial or
3-4 funeral benefits or merchandise (hereinafter called "prepaid
3-5 funeral benefits"), or who shall solicit the designations by an
3-6 individual of the items of funeral merchandise or services which he
3-7 desires to be provided out of any fund, investment, security, or
3-8 contract to be created or purchased by such individual at the
3-9 suggestion or solicitation of the organization shall obtain a
3-10 permit from the Board <State Banking Department (hereinafter called
3-11 Department) of this state> authorizing the transaction of this type
3-12 of business, before conducting such business. Seller shall not be
3-13 entitled to enforce a contract made in violation of this Act, but
3-14 the purchaser or his heirs, or legal representative, shall be
3-15 entitled to recover all amounts paid to the seller under any
3-16 contract made in violation thereof, and all amounts paid whether or
3-17 not paid seller, to any fund or for any investment, security, or
3-18 contract where the seller has violated the provisions of this Act.
3-19 Delivery of funeral merchandise prior to death shall not constitute
3-20 performance or fulfillment, either wholly or in part, of any
3-21 prepaid funeral benefits contract entered into after the effective
3-22 date of this amendatory Act.
3-23 Provided, however, that grave lots, grave spaces, grave
3-24 markers, monuments, tombstones, crypts, niches, and mausoleums
3-25 shall not be excluded from the provisions of this Section when
3-26 these items and articles are sold in contemplation of trade or
3-27 barter for services and articles designated as included by the
4-1 provisions of this Section.
4-2 SECTION 5. Section 1a, Chapter 512, Acts of the 54th
4-3 Legislature, Regular Session, 1955 (Article 548b, Vernon's Texas
4-4 Civil Statutes), is amended to read as follows:
4-5 Sec. 1a. No organization covered by this Act shall solicit
4-6 by any means whatsoever the designation by an individual of funeral
4-7 services or merchandise which he desires to be provided to be paid
4-8 out of any fund, investment, security, or contract, to be created
4-9 or purchased by or for such an individual at the suggestion or
4-10 solicitation of the organization, unless such a fund is to be
4-11 created by a life insurance policy or an annuity contract with an
4-12 insurance company licensed in Texas, or unless such fund,
4-13 investment, security, or contract shall have been approved by the
4-14 Board <Department> as safeguarding the right and interests of the
4-15 individual, his heirs and assigns, to substantially the same or
4-16 greater degree as is provided with respect to funds regulated by
4-17 Section 5 hereof. Provided, however, that the Board <Department>
4-18 may require evidence of payment of premiums on any life insurance
4-19 policy, or an annuity contract used to create a fund to guarantee
4-20 prepaid funeral benefits. Any seller failing to provide such
4-21 evidence to the Board <Department> after being so requested by
4-22 written notice shall be subject to cancellation of its permit under
4-23 the provisions of Section 4 of this Act.
4-24 SECTION 6. Section 2, Chapter 512, Acts of the 54th
4-25 Legislature, Regular Session, 1955 (Article 548b, Vernon's Texas
4-26 Civil Statutes), is amended to read as follows:
4-27 Sec. 2. This law shall be administered by the Board <State
5-1 Banking Department>. The Board <Department> is authorized to
5-2 prescribe reasonable rules and regulations concerning application
5-3 fees, the keeping and inspection of records, the filing of
5-4 contracts and reports, changes in management or control of an
5-5 organization, and all other matters incidental to the enforcement
5-6 and orderly administration of this law; and the Board <Department>
5-7 may approve forms for sales contracts for prepaid funeral benefits.
5-8 All such contracts must be in writing and no contract form shall be
5-9 used without prior approval of the Board <Department>. All such
5-10 contracts shall state the name of the funeral home or other
5-11 organization primarily responsible for providing the funeral
5-12 services or merchandise specified in such contracts. In the event
5-13 the seller is not the funeral home designated to provide the
5-14 specified funeral services or merchandise, such contract shall not
5-15 be valid unless the funeral home so designated is a party to the
5-16 contract and therein agrees and obligates itself to provide such
5-17 specified funeral services or merchandise. It is further provided,
5-18 that all prearranged or prepaid funeral contracts shall set forth
5-19 the particulars of the funeral merchandise, including a description
5-20 and specifications of the material used in the caskets or grave
5-21 vaults to be furnished, and such contracts shall set forth the
5-22 particulars of the professional services to be performed and the
5-23 funeral home facilities and automotive equipment to be provided.
5-24 SECTION 7. Section 3, Chapter 512, Acts of the 54th
5-25 Legislature, Regular Session, 1955 (Article 548b, Vernon's Texas
5-26 Civil Statutes), is amended to read as follows:
5-27 Sec. 3. Each organization desiring to sell prepaid funeral
6-1 benefits shall file an application for a permit with the Board
6-2 <Department> and shall pay a filing fee of $250. The Commissioner
6-3 may conduct an investigation of the applicant, and if the
6-4 Commissioner finds that the business ability, experience,
6-5 character, and general fitness of the applicant warrants the
6-6 confidence of the public, the Commissioner shall grant the
6-7 application and issue a permit to the applicant. If the
6-8 Commissioner finds otherwise, the Commissioner shall notify the
6-9 applicant, who is entitled to a hearing on the application, on
6-10 request, within 60 days after the date of the request. The Board
6-11 <Department> by rule may adopt a system under which permits expire
6-12 on various dates during the year. The fee for renewal is $60.
6-13 SECTION 8. Section 4, Chapter 512, Acts of the 54th
6-14 Legislature, Regular Session, 1955 (Article 548b, Vernon's Texas
6-15 Civil Statutes), is amended to read as follows:
6-16 Sec. 4. The Board <Department> may cancel a permit or refuse
6-17 to renew a permit for failure to comply with any provision of this
6-18 Act or any valid rule or regulation which the Board <Department>
6-19 has prescribed, after reasonable notice to the permittee and after
6-20 a hearing if the permittee requests a hearing.
6-21 No organization shall be entitled to a new permit for a
6-22 period of one year after cancellation or refusal by the Board
6-23 <Department> to renew its permit, but shall thereafter be entitled
6-24 to a new permit upon satisfactory proof of compliance with this
6-25 law.
6-26 If a permit holder transfers the ownership of its business,
6-27 the permit holder shall notify the Board <Department> and the
7-1 depository of the funds held under Section 5 of this Act by
7-2 registered mail within seven days after the date the transfer is
7-3 consummated.
7-4 Any person aggrieved by the action of the Board <Department>
7-5 may appeal therefrom to a District Court in Travis County, Texas.
7-6 SECTION 9. Section 5, Chapter 512, Acts of the 54th
7-7 Legislature, Regular Session, 1955 (Article 548b, Vernon's Texas
7-8 Civil Statutes), is amended to read as follows:
7-9 Sec. 5. All sums heretofore or hereafter paid or collected
7-10 on contracts for prepaid funeral benefits entered into prior to the
7-11 effective date of this Act shall be handled in accordance with the
7-12 manner in which they have heretofore been handled. All sums paid
7-13 or collected on such contracts entered into after the effective
7-14 date of this Act (with the exception of those paid where a contract
7-15 of insurance previously is created or approved by the Board
7-16 <Department>) shall be handled in the following manner:
7-17 (1) The funeral home (or other entity collecting said
7-18 funds) may retain as its own money, for the purpose of covering its
7-19 selling expenses, servicing costs, and general overhead, an amount
7-20 not to exceed one-half of all funds so collected or paid until it
7-21 has received for its use and benefit an amount not to exceed ten
7-22 percent of the total amount agreed to be paid by the purchaser of
7-23 said prepaid funeral benefits as such total amount is reflected in
7-24 the contract. No charges or assessments, except premiums collected
7-25 on an insurance policy guaranteeing the payments on a prepaid
7-26 funeral contract or the unpaid balance thereof, shall be collected
7-27 from the purchaser other than those included in the total amount of
8-1 said contract.
8-2 (2) All amounts paid or collected, with the exception
8-3 of those permitted to be retained as set forth above, shall, within
8-4 thirty days after such collection, be (a) deposited in a savings
8-5 and loan association in this state in an interest-bearing account
8-6 insured by the federal government, or (b) deposited in a state or
8-7 national bank in this state in an interest-bearing account insured
8-8 by the federal government, or (c) placed with the trust department
8-9 in a state or national bank in this state, or in a trust company
8-10 authorized to do business in this state, to be invested by such
8-11 trust department or company in accordance with the terms and
8-12 provisions of the Texas Trust Code (Subtitle B, Title 9, Property
8-13 Code). Such deposits or trust accounts shall be carried in the
8-14 name of the funeral home or other entity to whom the purchaser
8-15 makes payment, but accounting records shall be maintained showing
8-16 the amount deposited or invested with respect to any particular
8-17 purchaser's contract.
8-18 (3) The date of death of the purchaser of such
8-19 contract (or other individual who may be designated in the contract
8-20 as the person for whose funeral such funds may be used) shall be
8-21 the maturity date of the contract, and as soon as conveniently
8-22 practicable after such maturity date and upon presentation of a
8-23 certified copy of the death certificate of such person together
8-24 with proper affidavits as may be required by the Board
8-25 <Department>, such funds shall be released in fulfillment of the
8-26 contract, and the funeral home (or other entity to the contract
8-27 which has collected the funds) shall, if the amount so withdrawn
9-1 does not equal one hundred percent of the total amount paid by the
9-2 purchaser, make up the difference so that the amount available for
9-3 funeral benefits shall equal one hundred percent of the total
9-4 amount paid by the purchaser. Any amounts accumulated at maturity
9-5 on any particular contract in excess of one hundred percent of the
9-6 amount deposited or placed by the seller shall be available to the
9-7 funeral home (or other entity collecting said funds) in making up
9-8 the difference on any particular contract which at maturity did not
9-9 have funds available equal to one hundred percent of the amount
9-10 paid by the purchaser.
9-11 (4) The seller may withdraw at any time funds out of
9-12 accrued interest or income on the accounts for the purpose of
9-13 paying reasonable and necessary charges made by a savings and loan
9-14 association, or bank, or trust department of a bank, or trust
9-15 company, and trustee's fees made by a savings and loan association,
9-16 or bank, or trust department of a bank, or trust company, with
9-17 respect to such accounts, for the purpose of paying any taxes, with
9-18 prior approval of the Board <Department>, caused or created by
9-19 reason of the existence of such deposit accounts or trust accounts,
9-20 or for the purpose of paying any assessment under this Act or
9-21 ordered by the Board <Department> for funding a fund to guarantee
9-22 performance of prepaid funeral contracts.
9-23 The seller may also withdraw funds from the accrued interest
9-24 or income on the deposit accounts for the purpose of paying the
9-25 examination fee for one examination by the Board <Department> each
9-26 calendar year, or for the preparation of financial statements
9-27 required by the Board <Department> in lieu of an examination by the
10-1 Board <Department>.
10-2 Upon the maturity date of a contract as above provided and
10-3 only after the funeral home has fully performed its obligations
10-4 under said contract with the purchaser, or at the time of
10-5 cancellation prior to maturity as provided in Subsection (5)
10-6 herein, the seller may additionally withdraw from said deposit
10-7 account (whether a trust or other funded account) any enhanced
10-8 value, accrued interest, or accrued income on said contract. Such
10-9 withdrawal shall be the proportionate part of the total enhanced
10-10 value, accrued interest or accrued income, that the amount
10-11 deposited under said contract bears to the total amount deposited
10-12 from all unmatured contracts or, if the Commissioner has
10-13 affirmatively determined that the records of the permit holder are
10-14 adequate to allow this method to be exercised in an accurate
10-15 manner, the withdrawals may be equal to the actual earnings on
10-16 individual matured contracts, minus any properly allocated expenses
10-17 permitted by this subsection. On application, the Commissioner
10-18 may, after notice and hearing conducted pursuant to the
10-19 Administrative Procedure and Texas Register Act (Article 6252-13a,
10-20 Vernon's Texas Civil Statutes), authorize the seller of preneed
10-21 services to withdraw excess earnings from the trust deposits. For
10-22 the purposes of this section, "excess earnings" means funds in the
10-23 trust deposit that exceed 107 percent of the seller's obligations
10-24 on each contract for which deposits have been made after the date
10-25 the contracts are entered into. The Commissioner may grant the
10-26 authorization if, in the Commissioner's opinion, the evidence shows
10-27 that the seller's ability to deliver the contracted services and
11-1 merchandise is not diminished by the withdrawal. The Commissioner
11-2 by rule may set out factors that may be considered in evaluating
11-3 each application. The Commissioner's decision on whether to grant
11-4 the withdrawal is not limited to those factors. A withdrawal of
11-5 excess earnings made after an initial withdrawal as provided by
11-6 this subsection may not be approved for more than 93 percent of the
11-7 funds remaining in the accounts after the withdrawal that are in
11-8 excess of the 107 percent to be maintained in satisfaction of the
11-9 seller's contractual obligations.
11-10 (5) In the event a purchaser under a contract should
11-11 desire to cancel the contract prior to maturity, such cancellation
11-12 may be accomplished by the seller giving fifteen days notice in
11-13 writing to the Board <Department>, signed by the purchaser, and
11-14 thereafter, upon written authorization from the Board <Department>,
11-15 such seller may withdraw the funds in such depository being held
11-16 for the purchaser's use and benefit; provided, however, such
11-17 purchaser shall be entitled to receive only the actual amounts paid
11-18 in by him less the amounts permitted to be retained as provided in
11-19 Subsection (1) hereof. Purchaser or seller may make no partial
11-20 cancellations or withdrawals.
11-21 If the purchaser cancels the contract on the solicitation of
11-22 the seller, the purchaser is entitled to withdraw all funds paid to
11-23 the seller and all enhanced value attributable to the funds. If
11-24 the funds are used to purchase a new preneed funeral contract
11-25 pursuant to a solicitation by the seller, the new contract must, as
11-26 determined by the Board <Department>, protect the purchaser to an
11-27 extent equal to or greater than that provided by the original
12-1 contract, and the purchaser's cost of the same or substantially the
12-2 same services and merchandise may not be increased above that
12-3 contained in the canceled contract.
12-4 SECTION 10. Section 6, Chapter 512, Acts of the 54th
12-5 Legislature, Regular Session, 1955 (Article 548b, Vernon's Texas
12-6 Civil Statutes), is amended to read as follows:
12-7 Sec. 6. Each organization subject to this Act shall
12-8 designate an agent or agents, either by names of the individuals or
12-9 by titles of their offices or positions, who shall be considered as
12-10 fiduciaries under Section 32.45, Penal Code, and who are
12-11 responsible for deposit of funds collected under contracts for
12-12 prepaid funeral benefits. The organization shall notify the Board
12-13 <Department> of such designation within 10 days after it becomes
12-14 subject to this Act, and shall also notify the Board <Department>
12-15 of any change in such designation within 10 days before such change
12-16 occurs. If the seller or any other person acting on behalf of the
12-17 seller collects any money under such a contract and fails to
12-18 deliver it, within 30 days after collection, to a designated agent,
12-19 or if any designated agent fails to deposit the money within 30
12-20 days after he receives it, he commits an offense under Section
12-21 32.45, Penal Code.
12-22 SECTION 11. Section 7, Chapter 512, Acts of the 54th
12-23 Legislature, Regular Session, 1955 (Article 548b, Vernon's Texas
12-24 Civil Statutes), is amended to read as follows:
12-25 Sec. 7. The Board <Department> may require an annual report
12-26 from any permit holder in such form as the Board <Department> may
12-27 require. Any organization which has discontinued the sale of
13-1 prepaid funeral benefits but which still has outstanding contracts
13-2 shall not be required to obtain a renewal of its permit, but the
13-3 Board <Department> may require annual reports of said organization
13-4 until all such contracts have been fully discharged. If any
13-5 officer of any organization fails or refuses to file an annual
13-6 report or to cause it to be filed within 30 days after he has been
13-7 notified of the requirement by the Board <Department>, he shall be
13-8 guilty of a misdemeanor and a violation of this Act and shall be
13-9 punished by those means prescribed in Section 9 of this Act.
13-10 SECTION 12. Section 8, Chapter 512, Acts of the 54th
13-11 Legislature, Regular Session, 1955 (Article 548b, Vernon's Texas
13-12 Civil Statutes), as amended by H.B. No. 1766, Acts of the 72nd
13-13 Legislature, Regular Session, 1991, is amended to read as follows:
13-14 Sec. 8. (a) Each organization which has outstanding
13-15 contracts for prepaid funeral benefits shall maintain within this
13-16 state such records as the Board <Department> may require to enable
13-17 it to determine whether the organization is complying with the
13-18 provisions of this Act. Such records shall be subject to annual
13-19 examination by the Board <Department> or its agent and to such
13-20 additional examinations as it deems necessary. The organization
13-21 shall pay for the cost of examination, including the salary and
13-22 traveling expenses paid to the person making the examination during
13-23 the time spent in making the examination and in traveling to and
13-24 returning from the point where the records are kept, and all other
13-25 expenses necessarily incurred in the examination. The <Banking>
13-26 Commissioner or his agent shall assess and collect a fee in
13-27 connection with each examination, based on the organization's total
14-1 outstanding contracts, covering the cost of such examination, the
14-2 equitable or proportionate cost of maintenance and operation of the
14-3 Board <Banking Department>, and the enforcement of the provisions
14-4 of this Act; but the cost to the organization shall not be more
14-5 than a total cost of $3,000 for each examination.
14-6 (b) Following cancellation of a permit, the Commissioner may
14-7 seize all records of the prior permit holder and may seize all
14-8 prepaid funeral funds, including earnings, of the prior permit
14-9 holder, place them under the sole control of the Commissioner with
14-10 a state bank, the state treasury, a state-chartered trust company,
14-11 or an insurance company licensed and domiciled in this state and
14-12 approved by the Commissioner, and cause the funds to be maintained
14-13 under that arrangement for the benefit of the purchasers. The
14-14 Commissioner shall notify each purchaser of the Commissioner's
14-15 action and direct the purchaser to forward payments on contracts
14-16 directly to the depository designated by the Commissioner. The
14-17 Board <Department> may adopt reasonable rules for the enforcement
14-18 and orderly administration of this subsection.
14-19 (c) Those organizations with less than 50 contracts
14-20 outstanding shall be assessed an examination fee of $50 plus
14-21 one-fourth of one percent of the dollar amount of the
14-22 organization's outstanding contract funds on deposit, in trust, or
14-23 vested in any other program subject to this Act. Those
14-24 organizations with 50 or more contracts outstanding shall be
14-25 assessed an examination fee of $100 plus one-fourth of one percent
14-26 of the dollar amount of the organization's outstanding contract
14-27 funds on deposit, in trust, or vested in any other program subject
15-1 to this Act.
15-2 (d) As part of the examination, the Board <Department> is
15-3 entitled to access to the records of any entity holding deposits
15-4 under the account and to other records necessary to protect the
15-5 interests of the beneficiaries. The Board <Department> may conduct
15-6 an examination or audit at any place and in any manner the Board
15-7 <Department> considers necessary to protect the interests of the
15-8 purchasers or beneficiaries.
15-9 SECTION 13. Section 8A, Chapter 512, Acts of the 54th
15-10 Legislature, Regular Session, 1955 (Article 548b, Vernon's Texas
15-11 Civil Statutes), is amended to read as follows:
15-12 Sec. 8A. (a) The Board <Department> by rule shall create
15-13 and maintain a fund to guarantee performance by sellers of prepaid
15-14 funeral contracts of their obligations to purchasers under the
15-15 provisions of this Act governing funeral trusts. The Board
15-16 <Department> shall assess and collect from sellers an assessment of
15-17 not more than $1 for each of the unmatured prepaid funeral
15-18 contracts existing on January 1, 1988. The Board <Department>
15-19 shall also assess and collect an assessment of not more than $1 for
15-20 each prepaid funeral contract sold during 1988 by a permittee first
15-21 receiving a permit in 1988. The Board <Department> shall place the
15-22 assessments in the fund.
15-23 (b) The state treasurer shall manage the fund as trustee of
15-24 funds outside the treasury. The Board <Department> may use any
15-25 earnings from the fund for the expenses of operating and
15-26 maintaining the fund. An actuarial study shall be made before
15-27 April 1, 1988, to determine the total amount needed to maintain a
16-1 sound and responsible fund. The Board <Department> may make any
16-2 additional assessments on unmatured contracts to maintain the fund
16-3 at the amount found to be actuarially sound.
16-4 (c) The operation and maintenance of the fund shall be
16-5 supervised by an advisory council composed of the Commissioner and
16-6 Attorney General or their representatives and one representative of
16-7 the funeral industry appointed by the <Banking> Commissioner. The
16-8 funeral industry representative serves a two-year term and may not
16-9 serve more than one term.
16-10 (d) Notwithstanding any other law, the Board <Department>
16-11 may assert a claim against a seller or trust depository that
16-12 commits a violation of this Act that could result in a claim
16-13 against the fund.
16-14 SECTION 14. Sections 9(a), (e), and (f), Chapter 512, Acts
16-15 of the 54th Legislature, Regular Session, 1955 (Article 548b,
16-16 Vernon's Texas Civil Statutes), are amended to read as follows:
16-17 (a) A permit holder may not represent that a preneed funeral
16-18 vendor is approved or otherwise chosen by the Board <Department>
16-19 except with the following language: "The State Board of Insurance
16-20 <Texas Banking Department> regulates the sale of prearranged
16-21 funeral contracts" and "The form of this contract has been approved
16-22 by the Board <Department>."
16-23 (e) The Board <Department> may bring each such violation of
16-24 this Act to the attention of the Attorney General of this state and
16-25 it shall be the duty of the Attorney General to institute suit in
16-26 the name of the State of Texas against such violator in any county
16-27 in this state where such violation might occur.
17-1 (f) In addition to the penalties prescribed above, the
17-2 Attorney General shall have the power and authority to institute
17-3 quo warranto proceedings in a District Court of Travis County,
17-4 Texas to forfeit the charter and right to do business of a
17-5 corporation whose officer, director, agent or employee refuses or
17-6 fails to correct a violation of this Act after such violation has
17-7 been called to the attention of said officer, director, agent or
17-8 employee by the Board <Department> or the Attorney General. A
17-9 period of 30 days shall be considered sufficient time to correct
17-10 such violation after notice from the Board <Department> or Attorney
17-11 General.
17-12 SECTION 15. Section 10, Chapter 512, Acts of the 54th
17-13 Legislature, Regular Session, 1955 (Article 548b, Vernon's Texas
17-14 Civil Statutes), is amended to read as follows:
17-15 Sec. 10. Except as provided by Section 8A of this Act, all
17-16 <All> fees, penalties and revenues collected by the board under
17-17 this Act <department> shall be paid to the State Treasury, placed
17-18 in the State Board of Insurance operating fund <prepaid funeral
17-19 account fund> and shall be expended as authorized by legislative
17-20 appropriation.
17-21 SECTION 16. (a) On the effective date of this Act, the
17-22 powers, duties, and obligations of the Banking Department of Texas
17-23 relating to the regulation of perpetual care cemeteries or the sale
17-24 of prepaid funeral services or merchandise are transferred to the
17-25 State Board of Insurance, and the banking department shall transfer
17-26 all property and records relating to the regulation of perpetual
17-27 care cemeteries or the sale of prepaid funeral services or
18-1 merchandise in its custody to the board of insurance. All
18-2 employees of the banking department who perform the transferred
18-3 duties and all unexpended and unobligated appropriations of the
18-4 banking department for the performance of those duties are
18-5 transferred to the board of insurance on that date.
18-6 (b) On the transfer of all property and records under
18-7 Subsection (a) of this section, a rule, form, or policy adopted by
18-8 the Banking Department of Texas relating to the regulation of
18-9 perpetual care cemeteries or the sale of prepaid funeral services
18-10 or merchandise becomes a rule, form, or policy of the State Board
18-11 of Insurance.
18-12 (c) On the effective date of this Act, unexpended and
18-13 unobligated funds credited to the prepaid funeral account fund and
18-14 unexpended and unobligated funds collected under Chapter 712,
18-15 Health and Safety Code, and deposited under Section 712.042 of that
18-16 code shall be transferred to the State Board of Insurance operating
18-17 fund for the purposes prescribed by Section 10, Chapter 512, Acts
18-18 of the 54th Legislature, Regular Session, 1955 (Article 548b,
18-19 Vernon's Texas Civil Statutes), and Section 712.042, Health and
18-20 Safety Code, respectively.
18-21 SECTION 17. This Act takes effect December 1, 1993.
18-22 SECTION 18. The importance of this legislation and the
18-23 crowded condition of the calendars in both houses create an
18-24 emergency and an imperative public necessity that the
18-25 constitutional rule requiring bills to be read on three several
18-26 days in each house be suspended, and this rule is hereby suspended.