1-1 By: Grusendorf (Senate Sponsor - Harris of Tarrant) H.B. No. 2410
1-2 (In the Senate - Received from the House May 11, 1993;
1-3 May 12, 1993, read first time and referred to Committee on State
1-4 Affairs; May 22, 1993, reported favorably by the following vote:
1-5 Yeas 7, Nays 0; May 22, 1993, sent to printer.)
1-6 COMMITTEE VOTE
1-7 Yea Nay PNV Absent
1-8 Harris of Dallas x
1-9 Rosson x
1-10 Carriker x
1-11 Henderson x
1-12 Leedom x
1-13 Lucio x
1-14 Luna x
1-15 Nelson x
1-16 Patterson x
1-17 Shelley x
1-18 Sibley x
1-19 West x
1-20 Whitmire x
1-21 A BILL TO BE ENTITLED
1-22 AN ACT
1-23 relating to the operation of driver training schools.
1-24 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-25 SECTION 1. Section 3(7), Texas Driver and Traffic Safety
1-26 Education Act (Article 4413(29c), Vernon's Texas Civil Statutes),
1-27 is amended to read as follows:
1-28 (7) "Extension" means an entity that geographically
1-29 extends the educational resources of a driver training school by
1-30 offering a driving safety course in a location other than the main
1-31 business location of the school. An extension may use multiple
1-32 locations to teach a driving safety course if each location is
1-33 approved by the parent school and the agency. A driver education
1-34 course may not be conducted at an extension. An extension of an
1-35 extension is not permitted.
1-36 SECTION 2. Section 8, Texas Driver and Traffic Safety
1-37 Education Act (Article 4413(29c), Vernon's Texas Civil Statutes),
1-38 is amended to read as follows:
1-39 Sec. 8. COMPETITIVE BIDDING; ADVERTISING. (a) The board
1-40 may not adopt rules to restrict competitive bidding or advertising
1-41 by a driver training school except to prohibit false, misleading,
1-42 or deceptive competitive bidding or advertising practices.
1-43 Specifically, no rule may restrict:
1-44 (1) the use of an advertising medium;
1-45 (2) the outside dimensions of a printed advertisement
1-46 or outdoor display;
1-47 (3) the duration of an advertisement; or
1-48 (4) advertisement under a trade name.
1-49 (b) The board may adopt rules to restrict advertising by a
1-50 branch location of a school so that the branch location adequately
1-51 identifies its primary driver training school in any solicitation.
1-52 SECTION 3. Section 9, Texas Driver and Traffic Safety
1-53 Education Act (Article 4413(29c), Vernon's Texas Civil Statutes),
1-54 is amended to read as follows:
1-55 Sec. 9. Prohibitions. A person may not:
1-56 (1) operate a school without a driver training school
1-57 license issued by the commissioner;
1-58 (2) utilize advertising designed to mislead or deceive
1-59 a prospective student;
1-60 (3) fail to notify the commissioner of the
1-61 discontinuance of the operation of any school within three working
1-62 days after cessation of classes and make available accurate records
1-63 as required by this Act;
1-64 (4) sell, trade, or transfer a uniform certificate of
1-65 completion to any person, school, or extension not authorized to
1-66 possess it;
1-67 (5) sell, trade, or transfer a uniform certificate of
1-68 completion to a student who has not successfully completed an
2-1 agency-approved, six-hour <eight-hour> driving safety course;
2-2 (6) negotiate any promissory instrument received as
2-3 payment of tuition or other charge before completion of 75 percent
2-4 of the course, except that before that time, the instrument may be
2-5 assigned to a purchaser who will be subject to all the defenses
2-6 available against the school named as payee;
2-7 (7) conduct any part of an agency-approved driver
2-8 education or driving safety course without an instructor who is
2-9 physically present in appropriate proximity to the student for the
2-10 type of instruction being given; or
2-11 (8) violate any provision of this Act.
2-12 SECTION 4. The Texas Driver and Traffic Safety Education Act
2-13 (Article 4413(29c), Vernon's Texas Civil Statutes) is amended by
2-14 adding Section 10A to read as follows:
2-15 Sec. 10A. BRANCH LOCATIONS. A driver training school that
2-16 teaches a driver education course at one or more branch locations
2-17 other than the main business location of the school must obtain a
2-18 driver training school license for the main business location of
2-19 the school and a driver training school license for each branch
2-20 location. An extension or a branch location of a branch location
2-21 is not permitted.
2-22 SECTION 5. Sections 13(b), (d), and (g), Texas Driver and
2-23 Traffic Safety Education Act (Article 4413(29c), Vernon's Texas
2-24 Civil Statutes), are amended to read as follows:
2-25 (b)(1) License, application, and registration fees shall be
2-26 collected by the commissioner and deposited with the state
2-27 treasurer. Fees shall be sufficient to cover administrative costs
2-28 and may not be subject to refund. Each fee shall be set by the
2-29 commissioner and approved by the board in an amount not to exceed
2-30 150 percent of the following:
2-31 (A) the initial fee for a driver training school
2-32 license is $1,700 plus $850 for each branch location;
2-33 (B)(i) annual renewal fees as specified in this
2-34 subsection may be waived by the agency if revenue generated by the
2-35 sale of uniform certificates of completion is sufficient to fund
2-36 the cost of administering this Act and Section 143A, Uniform Act
2-37 Regulating Traffic on Highways (Article 6701d, Vernon's Texas Civil
2-38 Statutes); and
2-39 (ii) the annual renewal fee for a school
2-40 license shall be determined by the board in an amount sufficient to
2-41 fund the cost of administering this Act and Section 143A, Uniform
2-42 Act Regulating Traffic on Highways (Article 6701d, Vernon's Texas
2-43 Civil Statutes);
2-44 (C) the fee for a change of address of a school
2-45 is $180;
2-46 (D) the fee for a change of name of a school or
2-47 owner is $100;
2-48 (E) the application fee for each additional
2-49 course is $25;
2-50 (F) the application fee for each director is
2-51 $30, and for each assistant director, or administrative staff
2-52 member is $15;
2-53 (G) the fee for each extension is $35;
2-54 (H) each application for an original driver
2-55 training instructor's license shall be accompanied by a processing
2-56 fee of $50 and an annual license fee of $25; and
2-57 (I) the fee for a duplicate license, which may
2-58 be issued if the original is lost or destroyed and an affidavit of
2-59 that fact is filed with the agency, shall be set by the board in an
2-60 amount sufficient to cover the costs of issuing the duplicate
2-61 license.
2-62 (2) A driver education instructor who teaches driver
2-63 education courses in a county having a population of 50,000 or
2-64 less, according to the most recent federal census, and who has no
2-65 more than 200 students annually, shall be regulated by the agency
2-66 as a school. An instructor described by this subdivision shall
2-67 submit a school application or renewal form plus all required
2-68 documentation and information to the agency. The commissioner may
2-69 waive initial school fees, annual school renewal fees, or
2-70 director's or administrative staff member's fees. An instructor
3-1 described by this subdivision is not exempt from licensing
3-2 requirements or fees.
3-3 (3) The commissioner shall periodically review and
3-4 recommend adjustments in the level of fees to the board and
3-5 legislature.
3-6 (4) The fee for an investigation at a school to
3-7 resolve a complaint filed against the school shall be set by the
3-8 commissioner and approved by the board. The complaint
3-9 investigation fee may be charged only if:
3-10 (A) the complaint could not have been resolved
3-11 solely by telephone or written correspondence;
3-12 (B) a representative of the agency visited the
3-13 school as a part of the complaint resolution process; and
3-14 (C) the school is found to be at fault.
3-15 (5) The agency shall print and supply serially
3-16 numbered uniform certificates of course completion to owners or
3-17 primary consignees of courses approved under this Act. The agency
3-18 may charge a fee of $1 for each certificate. An owner or consignee
3-19 may not charge an operator a fee in excess of the fee paid to the
3-20 agency for a certificate.
3-21 (6) The commissioner, with approval of the board, may
3-22 increase any fee authorized under this subsection at a rate that
3-23 does not exceed the increase in the Consumer Price Index for All
3-24 Urban Consumers published by the Department of Labor. Fees under
3-25 this subsection do not have to be increased annually.
3-26 (7) Fees collected under this subsection shall be
3-27 deposited in the state treasury in a special account in the General
3-28 Revenue Fund. Money in the account may be appropriated only for
3-29 the administration of this Act and Section 143A, Uniform Act
3-30 Regulating Traffic on Highways (Article 6701d, Vernon's Texas Civil
3-31 Statutes).
3-32 (d)(1) The commissioner, on review of an application for a
3-33 driver training school license that is submitted in accordance with
3-34 this Act and that meets the requirements of this Act, shall issue a
3-35 driver training school license to the applicant. A driver training
3-36 school license shall be in a form recommended by the commissioner
3-37 and approved by the board and shall show in a clear and conspicuous
3-38 manner at least the following:
3-39 (A) the date of issuance, effective date, and
3-40 term of approval;
3-41 (B) the name and address of the school;
3-42 (C) the authority for approval and conditions of
3-43 approval;
3-44 (D) the signature of the commissioner; and
3-45 (E) any other fair and reasonable
3-46 representations that are consistent with this Act and considered
3-47 necessary by the commissioner.
3-48 (2) The term for which a driver training school
3-49 license is issued may not exceed one year.
3-50 (3)(A) A driver training school license issued to an
3-51 owner of the applicant school is nontransferable and is the
3-52 property of the state. In the event of a change in ownership of
3-53 the school, a new owner shall, at least 30 days before the date of
3-54 the change in ownership, apply for a new driver training school
3-55 license. Instead of the fees required by Subsection (b) of this
3-56 section, the fee for a new license required under this subdivision
3-57 is $500, plus $200 for each branch location, if the purchasing
3-58 entity is substantially similar to the transferring entity and
3-59 there is no significant change in the management or control of the
3-60 school.
3-61 (B) The commissioner is not required to
3-62 reinspect a school or a branch location after a change of its
3-63 ownership.
3-64 (4) At least 30 days before the expiration of a driver
3-65 training school license, the school shall forward to the
3-66 commissioner an application for renewal. The commissioner may
3-67 reexamine the school premises and shall renew or cancel the
3-68 school's driver training school license. If a school fails to file
3-69 a complete application for renewal at least 30 days before the
3-70 expiration date of the driver training school license, the school
4-1 shall pay as a condition of renewal and in addition to any annual
4-2 renewal fee a late renewal fee in an amount established by board
4-3 rule of at least $100, subject to Subsection (b) of this section.
4-4 (5) The commissioner shall visit a school and
4-5 reexamine the school for compliance with the criteria adopted under
4-6 this Act <not later than three months after the date a school
4-7 begins operation or after a change in ownership of a school>.
4-8 (g) Before a driver training school license may be issued
4-9 under this Act, a bond shall be provided by the school for the
4-10 period for which the license is to be issued, and the obligation of
4-11 the bond shall be that neither a provision of this Act nor any rule
4-12 adopted under this Act shall be violated by the school or any of
4-13 its officers, agents, or employees. A driver training school that
4-14 teaches driver education shall submit a bond in the amount of
4-15 $10,000 for its primary driver training school and $5,000 for each
4-16 branch location of the school. All other schools shall submit a
4-17 bond in the amount of $5,000. A bond must be a corporate surety
4-18 bond issued by a company authorized to do business in the state, be
4-19 payable to the state, and be used only for payment of a refund due
4-20 to a student or potential student. The bond shall be filed with
4-21 the commissioner and shall be in such form as shall be approved by
4-22 the commissioner. Posting of these bond amounts shall satisfy the
4-23 requirements for financial stability for schools under this Act.
4-24 SECTION 6. This Act takes effect September 1, 1993. The
4-25 change in law made by this Act applies only to an application for
4-26 an original or the renewal of a driver training school license that
4-27 is made on or after that date. An application for an original or
4-28 the renewal of a driver training school license made before the
4-29 effective date of this Act is covered by the law in effect when the
4-30 application was filed, and the former law is continued in effect
4-31 for this purpose.
4-32 SECTION 7. The importance of this legislation and the
4-33 crowded condition of the calendars in both houses create an
4-34 emergency and an imperative public necessity that the
4-35 constitutional rule requiring bills to be read on three several
4-36 days in each house be suspended, and this rule is hereby suspended.
4-37 * * * * *
4-38 Austin,
4-39 Texas
4-40 May 22, 1993
4-41 Hon. Bob Bullock
4-42 President of the Senate
4-43 Sir:
4-44 We, your Committee on State Affairs to which was referred H.B.
4-45 No. 2410, have had the same under consideration, and I am
4-46 instructed to report it back to the Senate with the recommendation
4-47 that it do pass and be printed.
4-48 Rosson,
4-49 Vice-Chairman
4-50 * * * * *
4-51 WITNESSES
4-52 FOR AGAINST ON
4-53 ___________________________________________________________________
4-54 Name: Scot Wilson x
4-55 Representing: Driving School Assn of Texas
4-56 City: Amarillo
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4-58 Name: Ann M. Streetman x
4-59 Representing: Texas Safety Assn
4-60 City: Austin
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