74(R) HB 785 Senate Committee Report

BILL ANALYSIS

C.S.H.B. 785
By: Seidlits (Montford)
Economic Development
5-23-95
Senate Committee Report (Substituted)
BACKGROUND

Section 7A of the Texas Manufactured Housing Standards Act provides
that persons regulated under this Act may voluntarily attend a
continuing education program.

PURPOSE

As proposed, C.S.H.B. 785 amends regulation of manufactured homes
by the commissioner of licensing and regulation and the Department
of Licensing and Regulation; authorizes the commissioner of
education to require participation in a continuing education
program to renew registration as a manufactured housing
manufacturer.

RULEMAKING AUTHORITY

It is the committee's opinion that rulemaking authority is granted
to the executive director of the Texas Department of Housing and
Community Affairs under SECTIONS 2, 9, and 13 (Sections 4, 13A(h),
and 19(s), Article 5221, V.T.C.S.) and SECTION 24 (Sections
2306.603(a) and 2306.604(a) and (d), Government Code) of this bill.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Sections 3(4), (8), (9), (14), and (21), Article
5221f, V.T.C.S. (Texas Manufactured Housing Standards Act), to
redefine "department," "seal," "label," "director," and "board."

SECTION 2. Amends Section 4, Article 5221f, V.T.C.S., as follows:

Sec. 4. MANUFACTURED HOUSING STANDARDS. (a) Requires the
executive director of the Texas Department of Housing and
Community Affairs (director), rather than the commissioner of
licensing and regulation (commissioner), to adopt standards
and requirements for the installation and construction of
manufactured housing.

(b) and (c) Make a nonsubstantive and a conforming change.
Created from existing text.

(d) Requires the standards to assure that the installation
of manufactured housing on both permanent and nonpermanent
foundation systems resists overturning and lateral movement
of the housing according to the design loads for the
particular wind zone for which the housing was constructed.
Deletes language regarding the standards for manufactured
housing. Redesignates existing Subsection (b).

(e) Provides that the requirements and standards for
manufactured homes as adopted by the state, rather than the
Texas Department of Licensing and Regulation (TDLR), in
existence on September 1, 1989, remain in force until
amended in accordance with the procedure in this section.
Created from existing text.

(f) Makes a conforming change. Created from existing text.

(g) Prohibits a local government unit without the approval
of the governing board of the Texas Department of Housing
and Community Affairs (board), rather than Texas Commission
of Licensing and Regulation (commission), following a
hearing on the matter, from adopting different standards
from those promulgated by the director for the construction
or installation of manufactured housing within the local
government unit. Makes conforming and nonsubstantive
changes. Redesignates existing Subsection (c).

(h)-(j) Make conforming and nonsubstantive changes.
Redesignate existing Subsections (d)-(f).

SECTION 3. Amends Section 6(g), Article 5221f, V.T.C.S., to make
a conforming change.

SECTION 4. Amends Section 7, Article 5221f, V.T.C.S., by amending
Subsections (a), (d), (e), (g), (i), and (k)-(q) and by adding
Subsection (r), as follows:

(a), (d), and (e) Make conforming and nonsubstantive changes.

(g) Provides that all certificates of registration are valid
for one year, rather than the period set by the commission.
Makes a conforming change.

(i) Makes a conforming change.

(k) Authorizes the director, after notice and hearing, to
refuse to issue or to permanently revoke or suspend for a
period of time and for a specified geographic area or sales
location, any certificate of registration if the director
finds that the applicant or registrant has a record of
criminal convictions within the five years preceding the date
of the application that, in the opinion of the director,
renders the applicant unfit for registration; or failed to
file the bond or post other security for each location as
required by this Act, rather than Section 13 of this article,
among other criteria. Makes conforming and nonsubstantive
changes.

(l) Makes a conforming change.

(m) Prohibits a retailer or an installer from contracting with
any person for the installation of any air-conditioning
equipment, devices, or components in connection with the
installation of a manufactured home unless the person is
registered as an installer with the Texas Department of
Housing and Community Affairs (department), rather than the
commissioner, or is otherwise licensed by the state as an air-conditioning contractor.

(n)-(q) Make conforming and nonsubstantive changes.

(r) Authorizes the director, in lieu of the instruction
requirements imposed under Subsection (p), to recognize and
approve a one-day training program for installers that is
conducted in the field by a private institution or other
person.

SECTION 5. Amends Section 7A, Article 5221f, V.T.C.S., to make a
conforming change.

SECTION 6. Amends Section 8, Article 5221f, V.T.C.S., by amending
Subsections (c), (e)-(h) and by adding Subsection (i), as follows:

(c), (e)-(h) Make conforming and nonsubstantive changes.

(i) Provides that a tax collector is not required to comply
with this section or other sections of this Act relating to
the sale of a used manufactured home in relation to the sale
of a manufactured home for the collection of delinquent taxes.
Authorizes the tax collector to apply to the department for a
seal, to pay the applicable fee, and to recover that fee as
part of the cost of the sale of a manufactured home if a
manufactured home does not have a serial number, seal, or
label. Provides that the seal issued to the tax collector is
for identification purposes only. Prohibits the seal from
being construed to imply that the home is habitable; or the
purchaser of the home at a tax sale may obtain a title
document from the department without an inspection for
habitability.

SECTION 7. Amends Section 9, Article 5221f, V.T.C.S., as follows:

Sec. 9. ADMINISTRATION AND ENFORCEMENT. (a) and (b) Make
conforming changes.

(c) Requires the state plan to provide for the use of third-party inspection agencies approved by the U.S. Department of
Housing and Urban Development and to act as an In Plant
Inspection Agency. Deletes language requiring a
manufacturer, at its option, to choose a third-party
inspection agency.

(d)-(g) Make conforming and nonsubstantive changes.

(h)-(m) Make conforming and nonsubstantive changes.
Redesignates existing Subsections (j)-(o).

SECTION 8. Amends Sections 11(a)-(c), (e), and (g), Article 5512f,
V.T.C.S., as follows:

(a)-(c), (e), and (g) Make conforming and nonsubstantive
changes.
SECTION 9. Amends Sections 13 and 13A, Article 5512f, V.T.C.S., as
follows:

Sec. 13. New heading: SECURITY. (a) Prohibits the
department from issuing or renewing a certificate of
registration unless a surety bond or other security in the
form prescribed by the director is filed with the department
as provided by this section. Deletes language regarding the
issuance of a certificate of registration by the commissioner.

(b) Requires the surety bond to be issued by a company
authorized to do business in this state and to conform to
applicable provisions of the Insurance Code if a surety bond
is filed. Requires other security, if other security is
posted, to be maintained in or by a banking institution
located in this state. Deletes existing Subsections (b) and
(c) regarding the posting of surety bonds or other
securities. Redesignates existing Subsection (d).

(c) Requires the surety bond or other security to be payable
to and for the benefit of the special trust fund established
under Section 13A of this Act. Deletes existing Subsections
(e) and (f) regarding the use of the surety bond or other
security and the liability of the surety bond or other
security.

(d) Created from existing text. Deletes existing Subsection
(g) requiring a consumer to inform a manufacturer, retailer,
or installer, and the department of any claim against a
surety bond or security.

(e) and (f) Make conforming changes. Redesignate existing
Subsections (h) and (i).

(g) Requires any other security on file with the department
to remain on file and be maintained for two years after the
person ceases business as a manufacturer, retailer, broker,
or installer or at such later time as determined by the
director. Makes conforming and nonsubstantive changes.
Redesignates existing Subsection (j).

(h) Provides that if a bond is cancelled, the certificate of
registration is suspended on the effective date of
cancellation. Entitles the registrant, if a surety files
for liquidation or reorganization in bankruptcy or is placed
in receivership, to 60 days from the date notice of filing
or receivership was received to obtain other security.

(i) Provides that subject to other limitations in this
section, the surety bond or other security is liable for,
and shall reimburse the recovery fund under Section 13A, the
amount of any claim paid out of the Manufactured Homeowners'
Recovery Fund (fund) by the director to a consumer that
resulted from an act or omission of the registrant who filed
the bond or other security. Requires payment by the surety
bond or from other security to be made by the 30th day from
the date of receipt of notice from the director that the
consumer claim has been paid. Requires the attorney general
to file suit for recovery of the amount due to the fund if
the surety bond or other security fails to make a timely
payment of a claim to the fund. Provides that venue for the
suit is in Travis County.

(j) Requires the director, as a trustee of the fund, to
prepare an information pamphlet informing the consumers of
their rights to recover from the recovery fund. Authorizes
the director to contract with private parties for the
printing and distribution of pamphlets. Deletes Subdivision
(k) regarding the commissioner's role as a registrant's
agent for service of a legal process.

Sec. 13A. New heading: RECOVERY FUND. (a) Establishes the
fund as a special account in the general revenue fund.
Requires the fund to be administered, rather than administered
and managed, by the director, rather than the commission.

(b) Prohibits any bond or other security to be required of
the director in the director's capacity as administer of the
fund, rather than by the board of trustees.

(c) Requires the additional title transaction fee to be
deposited in the fund created under this section. Makes
nonsubstantive changes.

(d) Provides that the fund, its fees, and the income earned
from its investments shall be used exclusively for the
protection of programs in this section, rather than for
carrying out the purposes of this section. Prohibits
investments of the fund from being made that impair the
liquidity necessary for the payment of the protection
programs, rather than to reimburse consumers, as provided in
this section. Makes nonsubstantive changes.

(e) Requires the fund, subject to limitations of Section 13
of this Act, to be used to compensate consumers who sustain
actual damages resulting from unsatisfied claims, rather
than unsatisfied judgments or certain limited claims,
against a manufacturer, retailer, broker, or installer
registered with the department if the claims resulted in a
violation of this Act, certain rules, or certain standards.

(f) Requires the consumer to file a verified written
complaint in the form required by the director by the two
years after the date of the alleged act or omission causing
the actual damages, or the second year after the date the
act or omission is or should have been discovered. Provides
that failure to timely file the claim precludes recovery
from the fund. Requires the department, on receipt of a
properly verified complaint, to notify the registrants as
appropriate and investigate the claim to determine its
validity and whether or not the complaint can be resolved
by remedial action of the registrants. Requires the
department to conduct an informal dispute resolution
process, including home inspection, for a resolution of the
disputes if there is a dispute between the registrants as to
responsibility. Requires the department to prepare and file
with the director a written report of the agreement if it
possible to secure the agreement of the parties.

(g) Requires the department, during the informal dispute
resolution process, to make a preliminary determination as
to the responsibility and liability of the manufacturer,
retailer, and installer of claims determined to be valid.
Requires the registrants to be afforded an opportunity to
comment on the preliminary determination under the
consideration by the department before it makes a final
determination. Requires the department to notify and give
the registrant's surety an opportunity to participate in the
informal dispute resolution process if the registrant goes
out of business. Provides that if a registrant or
registrant's surety fails or refuses to participate in the
informal dispute resolution process after receiving notice
of the claim, the registrant and the registrant's surety are
bound by the department's final determination of
responsibility and liability. Authorizes the department to
suspend or revoke the registrant's certificate of
registration.

(h) Authorizes the parties, if the dispute is not resolved
through the informal dispute resolution process, to elect to
submit the claim for formal binding arbitration. Requires
the director, by rule, to establish procedures for the
binding arbitration process and for the approval and
selection of arbitrators.

(i) Provides that the fund is not liable for, and the
director may not pay, any punitive, exemplary, double, or
treble damages, or damages for pain and suffering, mental
anguish, emotional distress, or other tort claims. Provides
that the payment for actual costs and expenses, not
including attorney's fees, that the consumer has incurred or
will incur to correct or resolve the acts or omissions found
to be violations. Prohibits a consumer from being paid more
than $35,000 in actual damages, and attorney's fees, costs,
and expenses are limited to 209 percent of the amount of
actual damages. Provides that neither the fund nor the
director is liable to the consumer if the fund does not have
the funds to pay the actual damages and attorney's fees
determined to be payable. Requires the director to record
the time and date of receipt of all verified complaints.
Requires the director to pay the consumer whose claim is the
earliest by time and date as funds become available.

(j) Requires $1 million to be reserved in the fund for
payment of valid consumer claims. Requires the costs and
expenses of the director and the department in administering
this section to be paid out of the fund unless the balance
of the fund is less than $1 million. Deletes existing
Subsections (e)-(k) regarding using the fund to compensate
consumers, and methods consumers may use to recover damages
from the fund.

(k) Redesignates existing Subsection (l). Deletes existing
Subsections (m) and (n) regarding administration of the fund
and liability of the fund.

SECTION 10. Amends Section 14, Article 5221f, V.T.C.S., as
follows:

Sec. 14. WARRANTIES. (a)-(c) Make no change.

(d) Makes a conforming change.

(e) Deletes language providing that written notice to the
office of the attorney general constitutes notice to the
retailer and manufacturer. Redesignates existing Section
(e)(1).

(f) Makes a conforming change. Redesignates existing
Subsection (e)(2).

(g)-(j) Make conforming and nonsubstantive changes.
Redesignates existing Subsections (e)(3)-(e)(6).

(k) Authorizes the manufacturer or retailer to recover its
actual damages and attorney's fees from the fund, rather
than from the other party's surety or security. Created
from existing (e)(6).

(l) Redesignates existing Subsection (f).

(m) Makes a conforming change. Redesignates existing
Subsection (g). Deletes existing Subsection (h) requiring
retailers to assume liability for a manufacturer who is no
longer registered with the commissioner or has filed for
reorganization or bankruptcy.

SECTION 11. Amends Section 17, Article 5221f, V.T.C.S., as
follows:

Sec. 17. New heading: PENALTIES; JUDICIAL REVIEW. (a)-(c)
Make conforming and nonsubstantive changes.

(d) Requires a judicial review of an order, decision, or
determination of the director to be instituted by filing a
petition with a district court in Travis County as provided
by Chapter 2001, Government Code.

SECTION 12. Amends Sections 18(a)-(f), Article 5221f, V.T.C.S.,
to make nonsubstantive changes.

SECTION 13. Amends Section 19, Article 5221f, V.T.C.S., as
follows:

Sec. 19. MANUFACTURED HOME TITLES. (a) and (b) Make
conforming changes.

(c)-(e) Make conforming and nonsubstantive changes.
Redesignate existing Subsections (c)(1)-(c)(3).

(f) Makes conforming changes. Redesignates existing
Subsection (d).

(g) Requires the owner designated in the original title
document to transfer the title on a form prescribed by the
director, rather than the commissioner executed before a
notary public. Requires the form to include any information
the director requires and a statement, rather than an
affidavit, that the person signing is the owner of the
manufactured home and that there are no liens on the home
except a lien shown on the document of title, instead of on
the title document or described in the affidavit. Makes
conforming changes. Redesignates existing Subsection (e).

(h) Authorizes the department to issue a new title document
in the name of the purchaser if foreclosure is of a
constitutional or statutory lien and the person entitled to
the lien, rather than the mortgagee, files an affidavit
showing the creation of the lien and of the divestiture of
title because of the lien in accordance with law. Makes
conforming changes. Redesignates existing Subsection (f).

(i) and (j) Makes conforming changes. Redesignates existing
Subsection (g) and (h).

(k) Provides that once perfected, the lien applies to the
manufactured homes in inventory as well as to any proceeds
of any sale of those homes. Makes conforming changes.
Redesignates existing Subsection (i).
(l) Requires the legal description of the appropriate tract
or parcel number, rather than the address and location, of
the real estate to be given to the department when the
certificate or document of title is surrendered. Requires
the department to issue a certificate of attachment to real
estate to the person who surrenders the manufacturer's
certificate or document of title. Requires the certificate
of attachment or document of title to contain the legal
description or the appropriate tract or parcel number of the
real estate and the identification of the home and must
certify that the manufacturer's certificate or original
document of title has been canceled. Makes conforming and
nonsubstantive changes. Redesignates existing Subsection
(j).

(m) Provides that liens recorded or registered with the
department have priority, in the chronological order of
recordation, over the liens or claims against the
manufactured home, other than expressly provided by Chapter
32, Tax Code. Redesignates existing Subsection (k).

(n) Makes a conforming and a nonsubstantive change.
Redesignates existing Subsection (l).

(o) Makes a conforming change. Redesignates existing
Subsection (m).

(p) and (q) Make nonsubstantive changes. Redesignate
existing Subsections (n) and (o).

(r) Makes a nonsubstantive change. Redesignates existing
Subsection (p).

(s) Makes conforming changes. Redesignates existing
Subsection (q).

(t) Requires fees for issuing and cancelling titles to be
deposited in the fund, rather than paid to the state
treasury, and used for purposes established under Section
13A. Deletes language regarding appropriations of the fund.
Makes conforming and nonsubstantive changes. Redesignates
existing Subsection (r).

(u)-(w) Make conforming and nonsubstantive changes.
Redesignate existing Subsections (s)-(u).

SECTION 14. Amends Section 20, Article 5221, V.T.C.S., as
follows:

Sec. 20. NOTICE TO CONSUMERS BEFORE TITLE TRANSFER. (a)
Makes a conforming change.

(b) Provides that the consumer's written acknowledgement of
receipt of the notice is conclusive proof of the delivery of
the notice and the posting of the notice in compliance with
federal regulations. Makes a conforming change.

(d) Makes a nonsubstantive change.

SECTION 15. Amends Title 1, Property Code, by adding Chapter 2,
as follows:

CHAPTER 2. NATURE OF PROPERTY

Sec. 2.001. MANUFACTURED HOUSING. (a) Provides that a
manufactured home is personal property.

(b) Sets forth the conditions in which a manufactured home
is real property.

(d) Provides that this section does not affect or change
the classification of a manufactured home as personal or
real property if the manufactured home was permanently
affixed to real property before January 1, 1996.

SECTION 16. Amends Article 6701-1/2B, V.T.C.S., by amending
Subdivision (1) and adding Subdivision (3), as follows:

(1) Sets forth the required contents of the permit prescribed
by the Texas Department of Transportation (TXDOT). Makes a
conforming change.

(3) Requires the department, if the movement of a
manufactured home under a permit issued by TXDOT begins or
ends in a county in this state, to send on a quarterly basis
a copy of the permit, or furnish the essential information in
the permit, to the chief appraiser of the appraisal district
for each county in which the movement begins or ends.

SECTION 17. Article 6701-1/2C, V.T.C.S., as follows:

(1) Requires TXDOT to only issue permits to persons
registered as manufacturers, installers, or retailers, or
retailers with the department or motor carriers registered
with TXDOT except as otherwise expressly authorized by this
section. Makes conforming changes.

(2) Makes conforming changes.

SECTION 18. Amends Article 6701-1/2D, V.T.C.S., to require a fee
of $16, rather than $15, to be collected by TXDOT. Requires $1 to
be deposited to the credit of the state highway fund. Provides
that Sections 403.094(h) and 403.905, Government Code, do not apply
to funds deposited in the state highway fund under this subsection.
Authorizes, rather than requires, the department to issue permit
books and route approval to be secured by telephone from the
issuing office along with any required validation number for the
permit. Deletes authority to issue packets containing 20
individual permits. Makes conforming changes.

SECTION 19. Amends Article 6701-1/2E(1), V.T.C.S., to authorize
instead of a roof beacon, two five-inch flashing amber lights to be
mounted approximately six feet from the ground level at the rear
corners of the manufactured home.

SECTION 20. Amends Section 32.014(a), Tax Code, to authorize the
manufactured housing, if such a lien is not of record on January 1
and the ownership of the manufactured home and the real property is
the same, to be appraised and taxed as an improvement to real
property. Makes a conforming change.

SECTION 21. Amends Section 32.015, Tax Code, as follows:

Sec. 32.015. RECORDING TAX LIEN ON MANUFACTURED HOME. (a)-(c) Make conforming and nonsubstantive changes.

(d) Requires the department to record the tax lien under
Subsection (c) even if the person listed as the owner on the
department's title records is not the person who owned the
manufactured home on the date that the tax was imposed.
Provides that recording of the tax lien does not invalidate
a title document or a certificate of title for the
manufactured home that was previously issued by the
department.

(e) Redesignated from existing (d). Makes conforming
changes.

(f) Provides that when the ownership of a manufactured home
is transferred, the subsequent owner or lienholder of the
home is considered to have notice of the ad valorem taxes
imposed on the home for the current tax year or for the
previous tax year if the time for filing a notice of a tax
lien under Subsection (b) has not expired.

(g) Redesignated from existing Subsection (e). Prohibits
the collector for a taxing unit from refusing to issue a tax
paid receipt to the person who offers to pay the taxes,
penalties, and interest for a particular year or years, even
though taxes may also be due for another year or other
years. Makes conforming changes.

(h) Provides that if a manufactured home for which a notice
of a tax lien is timely filed does not have a title recorded
on the records of the department, the tax lien is not
extinguished and is enforceable. Deletes existing
Subsection (f).

(i) Defines "department," "label," "seal," and
"manufactured home."

SECTION 22. Amends Section 32.03(b), Tax Code, to provide that
a bona fide purchaser for value or the holder of a lien recorded on
the manufactured home document of title is not required to pay any
taxes, penalties, or interest except for those years for which a
valid tax lien has been duly filed and recorded under Section
32.015 of this code and those years for which that owner of the
manufactured home has constructive notice of taxes under Section
32.015(e) of this code. Defines "manufactured home."

SECTION 23. Amends Section 2306.021(b), Government Code, to make
a conforming change.

SECTION 24. Amends Chapter 2306, Government Code, by adding
Subchapter Y, as follows:

SUBCHAPTER Y. MANUFACTURED HOUSING DIVISION

Sec. 2306.601. REGULATION AND ENFORCEMENT. Requires the
department to administer and enforce Article 5221f, V.T.C.S.,
through the manufactured housing division. Requires the board
and the director to exercise authority and responsibilities
assigned to them under that Act.

Sec. 2306.602. PERSONNEL. Authorizes the director to employ
staff as necessary to perform the work of the manufactured
housing division and to prescribe their duties and
compensation. Authorizes the director to remove any division
employee subject to applicable personnel policies and
regulations.

Sec. 2306.603. RULES. (a) Requires the director to adopt
rules as necessary to implement this subchapter and to
administer and enforce the manufacture housing program through
the manufactured housing division. Provides that rules
adopted by the director are subject to Chapter 2001,
Government Code.

(b) Prohibits the director from adopting rules restricting
competitive bidding or advertising by a person regulated by
the division except to prohibit false, misleading, or
deceptive practices by that person.

(c) Prohibits the director from including in the rules to
prohibit false, misleading, or deceptive practices by a
person regulated by the division a rule that meets certain
criteria.

Sec. 2306.604. SANCTIONS AND PENALTIES. (a) Requires the
director to adopt rules relating to the administrative
sanctions that may be enforced against a person regulated by
the manufactured housing division. Sets forth the authorized
actions of the director if a person violates a law relating to
the regulation of manufactured housing or a rule or order
adopted by the director relating to the program.

(b) Authorizes the board to assess an administrative
penalty in an amount not to exceed $1,000 for each violation
in addition to or in lieu of a sanction imposed under
Subsection (a).

(c) Authorizes the director to require the person to report
regularly to the director on matters that are the basis of
the probation if a suspension is probated,

(d) Provides that if the director proposes to suspend or
revoke a certificate of registration or the director
proposes to assess an administrative penalty against a
person regulated by the division, the person is entitled to
a hearing before a hearings officer appointed by the
director. Requires the director, by rule, to prescribe the
procedures by which a decision to suspend or revoke a
certificate of registration or to assess an administrative
penalty are made and are appealable.

(e) Sets forth the required considerations of the board in
determining the amount of an administrative penalty assessed
under this section.

(f) Requires the director to issue a preliminary report
stating the facts on which the conclusion that a violation
occurred is based, recommending that an administrative
penalty under this section be imposed on the person charged,
and recommending the amount of that proposed penalty, if the
director determines that a violation has occurred. Requires
the director to base the recommended amount of the proposed
penalty on the seriousness of the violation determined by
consideration of the factors set forth in Subsection (e) of
this section.

(g) Requires the director to give written notice of the
violation to the person charged not later than the 14th day
after the date on which the preliminary report is issued.
Sets forth the required contents of the notice.

(h) Authorizes the person charged, not later than the 20th
day after the date on which the notice is received, to
accept the determination of the director made under
Subsection (f) of this section or make a written request for
a hearing on that determination.

(i) Requires the director, if the person charged with the
violation accepts the determination of the director, to
issue an order approving the determination and ordering that
the person pay the recommended penalty.

(j) Requires the director, if the person charged fails to
respond in a timely manner to the notice or if the person
requests a hearing, to set a hearing, give written notice of
the hearing to the person, and designate a hearings examiner
to conduct the hearing. Requires the hearing examiner to
make findings of fact and conclusions of law and to issue to
the board a proposal for decision as to the occurrence of
the violation and a recommendation as to the amount of the
proposed penalty if a penalty is determined to be warranted.
Authorizes the board by order, based on the findings of fact
and conclusions of law and the recommendations of the
hearings examiner, to find that a violation has occurred and
to assess a penalty, or to find that not violation has
occurred.

(k) Requires the director to give notice of the board's
order to the person charged. Sets forth the required
contents of the notice.

(l) Sets forth the required actions of the person charged
to be taken within 30 days following the decision.

(m) Provides that a person charged with a penalty who is
financially unable to comply with Subsection (l)(2) of this
section is entitled to judicial review if the person files
with the court, as part of the person's petition for
judicial review, a sworn statement that the person is unable
to meet the requirements of that subsection.

(n) Authorizes the department or the attorney general to
bring an action from the collection of the penalty if the
person charged does not pay the penalty and does not pursue
judicial review.

(o) Provides that judicial review of the order of the board
assessing the penalty is subject to the substantial evidence
rule and shall be instituted by filing a petition with a
Travis County district court.

(p) Requires the director, after judicial review, to remit
to the person charged the appropriate amount plus accrued
interest if the penalty has been paid to execute a release
of the bond if a supersedeas bond has been posted. Requires
the accrued interest on amounts remitted by the director
under this subsection to be paid at a rate equal to the rate
charged on loans to depository institutions by the New York
Federal Reserve Bank, and to be paid for the period
beginning on the date that the assessed penalty is paid to
the director and ending on the date the penalty is remitted.

(q) Requires a penalty collected under this section to be
deposited in the state treasury to the credit of the general
revenue fund.

(r) Provides that all proceedings conducted under this
section and any review or appeal of those proceedings are
subject to Chapter 2001, Government Code.

(s) Authorizes the attorney general or director, if it
appears that a person is in violation of or is threatening
to violate any provision of Article 5221f, V.T.C.S., or a
rule or order related to the administration and enforcement
of the manufactured housing program, to institute an action
for injunctive relief to restrain the person from continuing
the violation and for civil penalties not to exceed $1,000
for each violation and not exceeding $250,000 in the
aggregate. Requires a civil action filed under this
subsection to be filed in district court in Travis County.
Authorizes the attorney general and the director to recover
reasonable expenses incurred in obtaining injunctive relief
under this subsection.

Sec. 2306.605. ACCEPTANCE OF DONATIONS. Authorizes the
department to accept gifts and grants of money or property
under this chapter and shall spend the money and use the
property for the purpose for which the donation was made,
except that the expenditure of money or use of property must
promote the acceptance of Housing and Urban Development code
manufactured homes as a variable source of housing for very
low to moderate income families.

SECTION 25. Repealer: (1) Section 16, Article 5221f, V.T.C.S.
(Judicial Review).

(2) The heading of Chapter 21A, Tax Code (Taxable Situs of
Property Generally).

(3) Chapter 21B, Tax Code (Determination of Situs of Mobile
Homes).

SECTION 26. (a) Effective date, regarding the transfer of the
administration, assets, obligations, liabilities, contracts,
records, leases, equipment, and other property of Article 5221f,
V.T.C.S., to the department from TDLR: September 1, 1995.

(b) Requires the comptroller to work with the department and
TDLR to apportion property and equipment to be used jointly by
those agencies in the regulation of manufactured housing and
related matters and entities. Requires the comptroller to
supervise and approve interagency contracts for shared
equipment and leased property to assure continuity of
manufactured housing regulation. Requires the comptroller to
coordinate the transfer of personnel from TDLR and the
department. Requires the department to prepare and furnish
the comptroller and TDLR a list of those employees requested
for transfer. Prohibits the number of employees transferred
on September 1, 1995, from exceeding the number of full-time
equivalent positions engaged in the manufactured housing
program as of August 1, 1995.

SECTION 27. Provides that the rules of TDLR and each affected
certificate, permit, bond, order, security, or registration issued
by TDLR are continued in effect by the department.

SECTION 28. Provides that a complaint, investigation, or
contested case pending before TDLR on August 31, 1995, is
transferred without change in status to the department on the
effective date of this Act.

SECTION 29. Provides that a reference in law to TDLR relating
to the administration and enforcement of Article 5221f, V.T.C.S.,
means and is a reference to the department.

SECTION 30. (a) Makes application of the repeal of Section
21.24, Tax Code, prospective.

(b) Provides that the amendment of Section 13, Article 5521f,
V.T.C.S., by this Act does not invalidate or affect a surety
bond or other security on file with TDLR on the effective date
of this Act. Provides that the surety bond or security is
considered endorsed to the fund on the date and is subject to
Section 13. Requires a surety company and a registrant filing
a new bond or other security with the department by March 1,
1996.

(c) Provides that the balance in the fund administered by TDLR
on August 31, 1995, is transferred to the special account
created by Section 13A, Article 5221, V.T.C.S., on the
effective date of this Act.

SECTION 31. Effective date: September 1, 1995.

SECTION 32. Emergency clause.