BILL ANALYSIS


                                                        H.B. 2745
                                                By: Romo (Rosson)
                                             Economic Development
                                                          5-24-95
                              Senate Committee Report (Unamended)
BACKGROUND

Automated teller machines (ATMs) came to Texas 15 years ago. Today,
with over 90,000 ATMs in the country, Texas consumers alone will
perform nearly 300 million transactions. With the widespread
availability and use of ATMs in today's society, the vulnerability
of the ATM user has increased and reports of ATM robberies and
assaults are increasing. As fixed locations open for business 24
hours a day, ATMs have become easy target sites for criminals.

PURPOSE

As proposed, H.B. 2745 provides guidelines for the implementation
of safety standards concerning the placement and operation of
automated teller machines in Texas.

RULEMAKING AUTHORITY

It is the committee's opinion that rulemaking authority is granted
to the Finance Commission and the Credit Union Commission under
SECTION 1 (Sec. 7(a), Article 342-901 et seq., V.T.C.S.) of this
bill.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Chapter IX, Article 342-901 et seq., V.T.C.S.,
by adding Article 3d, as follows:

         Art. 3d. UNMANNED TELLER MACHINES: USER SAFETY

     Sec. 1. DEFINITION. Defines "access area," "access device,"
     "candlefoot power," "control," "customer," "defined parking
     area," "financial institution," "hours of darkness,"
     "operator," "owner," "person," public road," and "unmanned
     teller machine."
     
     Sec. 2. LEGISLATIVE INTENT: CONSTRUCTION.  Sets forth the
     intent of the legislature regarding each unmanned teller
     machine (teller machine) in this state.
     
     Sec. 3. SAFETY PROCEDURES. (a) Requires the operator or owner
     of a teller machine to provide lighting during the hours of
     darkness for the machine and its access area and defined
     parking area (area). Requires the owner or operator to provide
     lighting during the hours of darkness for the exterior of the
     enclosure if the teller machine is located in an enclosure.
     
     (b) Sets forth provisions regarding minimum lighting the
       owner or operator shall provide.
       
       (c) Provides that if an area for a teller machine is not
       controlled by the owner or operator of the machine, and if
       the person who leased the site where the machine is located
       controls the area, that person shall comply with this
       section.
       
       Sec. 4. SAFETY EVALUATIONS. Requires an owner or operator of
     teller machines to evaluate the safety of each machine owned
     or operated by the person and to include in the evaluation
     certain considerations.
     
     Sec. 5. NOTICE. Requires an issuer of access devices to
     furnish the issuer's customers  with a notice of basic safety
     precautions that each customer should employ while using a
     teller machine. Requires the issuer to deliver the information
     to each customer whose mailing address is in this state
     according to records for the account to which the access
     device relates. Provides that if an issuer furnishes access
     devices to more than one customer on the same account, the
     issuer is required to furnish a notice to only one customer
     named on the account to satisfy this section. Authorizes the
     issuer to furnish information under this section with other
     disclosures related to the access device, such as an initial
     or periodic disclosure statement furnished pursuant to 15
     U.S.C. Section 1693 et seq. (federal Electronic Fund Transfer
     Act).
     
     Sec. 6. LIMITATION. Sets forth teller machine locations to
     which this article does not apply.
     
     Sec. 7. ENFORCEMENT: RULES. (a) Requires the Finance
     Commission and the Credit Union Commission to enforce this
     article and adopt rules to implement this article.
     
     (b) Requires the rules to establish security requirements to
       be implemented by banks for the operation of teller
       machines. Authorizes the rules to require the banks to
       install and maintain security devices in addition to those
       required by this article to be operated in conjunction with
       the machines for the protection of customers using the
       machines.
       
       (c) Provides that failure by a bank to comply with the rules
       adopted under this section constitutes grounds for the
       imposition of a civil penalty under Section 7, Article 3a,
       of this chapter.
       
       SECTION 2.   (a) Requires an issuer of access devices to teller
machines to provide notice to customers as required by Section 5,
Article 3d, Chapter 9, Article 342-903d, V.T.C.S. (Texas Banking
Code), as added by this Act, no later than January 1, 1996.

     (b) Requires an owner or operator of a teller machine or a
     person described by Section 3(c), Article 3d, Chapter IX,
     Article 342-903d, V.T.C.S., as added by this Act, to comply
     with safety requirements imposed by that article no later than
     September 1, 1996.
     
     SECTION 3.     Emergency clause.
           Effective date: upon passage.