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.