By:  Armbrister                                       S.B. No. 1474

         Line and page numbers may not match official copy.

         Bill not drafted by TLC or Senate E&E.

                                A BILL TO BE ENTITLED

                                       AN ACT

 1-1     relating to the waste tire recycling fund.

 1-2           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-3           SECTION 1.  Sections 361.112 (f) and (g), Health and Safety

 1-4     Code, are amended to read as follows:

 1-5           (f)  A person may not store more than 500 [used or] scrap

 1-6     tires or dispose of any quantity of [used or] scrap tires unless

 1-7     the tires are shredded, split, or quartered as provided by

 1-8     commission rule.  The commission may grant an exception to this

 1-9     requirement if the commission finds that circumstances warrant the

1-10     exception.  The prohibition provided by this subsection regarding

1-11     storage does not apply to:

1-12                 (1)  a registered scrap [waste] tire energy recovery

1-13     facility, scrap tire recycler, scrap tire facility or a whole scrap

1-14     [waste] tire energy recovery facility storage site;

1-15                 (2)  [.  The prohibition provided by this subsection

1-16     does not apply to] a person who, for eventual recycling, reuse, or

1-17     energy recovery, temporarily stores scrap tires in a designated

1-18     recycling collection area at a landfill permitted by the commission

1-19     or licensed by a county or by a political subdivision exercising

1-20     the authority granted by Section 361.165; or

1-21                 (3)  a person described in Section 361.472(a) who

 2-1     stores not more than 1,000 scrap tires for more than 30 days.

 2-2           (g)  The commission shall require a person who transports

 2-3     used or scrap tires for storage, [or] disposal, or end use to

 2-4     maintain records and use a manifest or other appropriate system to

 2-5     assure that those tires are transported to a storage site that is

 2-6     registered or to a disposal facility that is permitted under this

 2-7     section for that purpose, or to a registered end user.

 2-8           SECTION 2.  The heading to Subchapter P, Chapter 361, Health

 2-9     and Safety Code, is amended to read as follows:

2-10             SUBCHAPTER P.  SCRAP [WASTE] TIRE RECYCLING PROGRAM

2-11           SECTION 3.  Section 361.471, Health and Safety Code, is

2-12     amended to read as follows:

2-13           Sec. 361.471.  Definitions.  In this subchapter:

2-14                 (1)  "Class I Region" means any area within 190 miles

2-15     from the cities Dallas, Fort Worth, Houston, or San Antonio as that

2-16     distance is determined by the Texas Department of Transportation

2-17     Official Highway Map, and shall include the entirety of any county

2-18     which has at least 50 percent of its area within that distance.

2-19                 (2)  "Class II Region" means any area of the state

2-20     which is not within a Class I Region.

2-21                 (3)  "End use" includes the use of whole scrap tires,

2-22     shredded tire pieces, or tire-derived material for a civil

2-23     engineering application or practice, energy recovery, or the

2-24     manufacture of a product with economic value or for any other

2-25     process or product that the commission by rule determines meets the

 3-1     objectives of this subchapter.

 3-2                 (4)  "Fund" means the scrap [waste] tire recycling

 3-3     fund.

 3-4                 (5) [(2)]  "Green tire" means the casing form of a tire

 3-5     that has not been cured or does not have a tread or marking of any

 3-6     kind.

 3-7                 [(3)  "Good used tire" means a used tire, not including

 3-8     a recapped or retreaded tire, suitable for continued use for its

 3-9     original intended purpose.]

3-10                 (6) [(4)]  "Manufacturer reject tire" means a tire

3-11     rendered defective in the manufacturing process, whether the tire

3-12     is determined to be defective before or after consumer purchase.

3-13                 (7) [(5)]  "Mobile tire shredder" means equipment

3-14     mounted on wheels or skid-mounted and hauled from place to place to

3-15     split, shred, or quarter [used or] scrap tires.

3-16                 (8) [(6)]  "Scrap tire" has the meaning assigned by

3-17     Section 361.112.

3-18                 (9) [(7)]  "Scrap [Waste] tire energy recovery

3-19     facility" means a facility at which [whole used or scrap tires or]

3-20     shredded tires are used as a fuel, including:

3-21                       (A)  a cement kiln;

3-22                       (B)  a utility boiler;

3-23                       (C)  a pulp and paper mill;

3-24                       (D)  a cogeneration facility; or

3-25                       (E)  a foundry; or

 4-1                       (F) [(E)]  another facility designated by the

 4-2     commission.

 4-3                 (10)  "Scrap tire generator" includes an entity that

 4-4     accepts scrap tire pieces for temporary storage, a fleet operator,

 4-5     an automotive dismantler, or a whole new or used tire retailer,

 4-6     wholesaler, manufacturer, recapper, or retreader.  The term does

 4-7     not include a scrap tire facility, scrap tire recycler or whole

 4-8     scrap tire energy recovery facility that stores whole tires or tire

 4-9     pieces.

4-10                 (11) [8]  "Scrap [Waste] tire facility" means a

4-11     facility [registered by the commission under Section 361.477] at

4-12     which scrap tires are collected and shredded to facilitate the

4-13     future extraction of useful materials for recycling, reuse, or

4-14     energy recovery and are stored in a scrap [waste] tire storage

4-15     facility or a facility that recycles, reuses, or recovers the

4-16     energy from the shredded tire pieces.

4-17                 (12) [(9)]  "Scrap [waste] tire processor" means:

4-18                       (A)  a scrap [waste] tire facility; or

4-19                       (B)  a mobile tire shredder that splits, shreds,

4-20     or quarters tires and deposits the split, shredded, or quartered

4-21     tires for eventual recycling, reuse, or energy recovery at:

4-22                             (i)  a scrap [waste] tire storage facility

4-23     registered by the commission under Section 361.112; or

4-24                             (ii)  a scrap [waste] tire facility.

4-25                 (13) [(10)]  "Scrap [Waste] tire storage facility"

 5-1     means a facility registered by the commission under Section

 5-2     361.4725 [361.477] at which whole [used or] scrap tires or shredded

 5-3     tire pieces are collected and stored to facilitate the future

 5-4     extraction of useful material for recycling, reuse, or recovery.

 5-5     The term does not include a marine dock, rail yard, or trucking

 5-6     facility used to store tires that are awaiting shipment to a person

 5-7     for recycling, reuse, or energy recovery for 30 days or less.

 5-8                 (14) [(11)]  "Scrap [Waste] tire transporter" means a

 5-9     person who collects and transports [used or] scrap tires or scrap

5-10     tire pieces for storage or disposal.

5-11                 (15)  "Tire-derived material" includes crumb rubber,

5-12     materials produced from scrap tires or tire pieces through a

5-13     pyrolytic or other chemical or thermal process.

5-14                 (16)  "Whole scrap tire energy recovery facility" means

5-15     a facility at which whole scrap tires are used as fuel.

5-16                 [(12)  "Weighed tire" means a unit of weight for

5-17     shredded scrap tires that is equal to 18.7 pounds.]

5-18           SECTION 4.  Section 461.472, Health and Safety Code, is

5-19     amended to read as follows:

5-20           Sec. 361.472.  SCRAP [WASTE] TIRE RECYCLING FEES.  (a)  A

5-21     person in the business of selling new [good used] tires who sells

5-22     or offers to sell new tires not for resale [for use on a vehicle,]

5-23     or a person in the business of selling used vehicles or used

5-24     vehicle parts who sells or offers to sell new [or good used] tires

5-25     not for resale shall collect at the time and place of sale a scrap

 6-1     [waste] tire recycling fee for each tire sold as follows:

 6-2                 (1)  $2 for each new tire that has a rim diameter of 12

 6-3     inches or more but less than 17.5 inches [and $1 for each good used

 6-4     tire that has a rim diameter of 12 inches or more but less than

 6-5     17.5 inches];

 6-6                 (2)  $3.50 for each new tire that has a rim diameter of

 6-7     17.5 inches or greater, other than an off-the-road tire intended

 6-8     for use on heavy machinery, including an earthmover, a

 6-9     loader/dozer, a grader, or mining equipment; and

6-10                 (3)  $1.50 [$2] for a new motorcycle tire, regardless

6-11     of the rim diameter.

6-12           (b)  The sale of a tire as original equipment in the

6-13     manufacture of a new vehicle is a sale for resale.

6-14           (c)  A fee may not be assessed for:

6-15                 (1)  a recapped or retreaded tire; [or]

6-16                 (2)  a bicycle tire; or

6-17                 (3)  a solid industrial tire.

6-18           (d)  A person required to collect a fee under this section:

6-19                 (1)  shall list as a separate item on an invoice a fee

6-20     due under this section; and

6-21                 (2)  except as provided by Subsection (e), on or before

6-22     the 20th day of the month following the end of each calendar month

6-23     and on a form and in the manner prescribed by the comptroller,

6-24     shall file a report with and shall remit to the comptroller the

6-25     amount of fees collected during the preceding calendar month.

 7-1           (e)  A person required to collect a fee under this section

 7-2     who collects less than $50 for a calendar month or less than $150

 7-3     for a calendar quarter is not required to file a monthly report but

 7-4     shall file a quarterly report with and make a quarterly remittance

 7-5     to the comptroller.  The quarterly report and remittance shall

 7-6     include fees collected during the preceding calendar quarter.  The

 7-7     report and remittance are due not later than the 20th day of the

 7-8     month following the end of the calendar quarter.

 7-9           (f)  An invoice or other record required by this section or

7-10     rules of the comptroller must be maintained for at least four years

7-11     after the date on which the invoice or record is prepared and be

7-12     open for inspection by the comptroller at all reasonable times.

7-13           (g)  The comptroller shall adopt rules necessary for the

7-14     administration, collection, reporting, and payment of the fees

7-15     payable or collected under this section.

7-16           (h)  A scrap [waste] tire recycling fee is imposed on the

7-17     storage, use, or consumption in this state of a tire at the same

7-18     rate as provided by Subsection (a), except when purchased for the

7-19     purpose of resale.

7-20           (i)  A person storing, using, or consuming a tire in this

7-21     state is liable for the scrap [waste] tire recycling fee as defined

7-22     in this section and is responsible for reporting and paying the fee

7-23     to the comptroller in the same manner as a person required to

7-24     collect this fee, as provided in Subsections (d)(2) and (e).

7-25           (j)  A person storing, using, or consuming a tire in this

 8-1     state is not further liable for the scrap [waste] tire recycling

 8-2     fee imposed by Subsection (a) if the person:

 8-3                 (1)  pays the fee to:

 8-4                       (A)  a person who is required to collect the fee

 8-5     under Subsection (a) and who is engaged in business in this state;

 8-6     or

 8-7                       (B)  another person authorized by the comptroller

 8-8     to collect the fee; and

 8-9                 (2)  receives a purchaser's receipt from the person to

8-10     whom the fee was paid.

8-11           (k)  In this section:

8-12                 (1)  "Engaged in business in this state" has the

8-13     meaning provided under Sections 151.107(a) and (b), Tax Code.

8-14                 (2)  "Purchased for resale" means acquired by means of

8-15     a sale for resale as defined in Section 151.006, Tax Code.

8-16                 (3)  "Storage" and "use" have the meanings assigned

8-17     those terms by Section 151.011, Tax Code.

8-18           SECTION 5.  Section 361.4275, Health and Safety Code, is

8-19     amended to read as follows:

8-20           Sec. 361.4725.  REGISTRATION; FEE.  (a)  A scrap tire

8-21     facility, scrap tire recycler, scrap tire storage facility, scrap

8-22     tire transporter, scrap tire processor, scrap tire energy recovery

8-23     facility, whole scrap tire energy recovery facility, or scrap tire

8-24     generator shall register with the commission in accordance with

8-25     commission rules and on the forms prescribed by the commission.

 9-1           (b)  A person who applies to the commission to register under

 9-2     this section [a waste tire storage facility, a waste tire energy

 9-3     recovery facility storage site, a waste tire recycler, or a fixed

 9-4     or mobile tire processor,] or applies to renew or amend the

 9-5     registration, must pay a fee set by the commission not to exceed

 9-6     [of] $500.

 9-7           SECTION 6.  Sections 361.474 and 361.475, Health and Safety

 9-8     Code, are amended to read as follows:

 9-9           Sec. 361.474.  Disposition of Fees and Penalties.  Fees and

9-10     penalties collected under this subchapter shall be deposited in the

9-11     state treasury to the credit of the scrap [waste] tire recycling

9-12     fund.

9-13           Sec. 361.475.  SCRAP [WASTE] TIRE RECYCLING FUND.  (a)  The

9-14     scrap [waste] tire recycling fund is a special account in the

9-15     general revenue fund.

9-16           (b)  The commission shall administer the fund.

9-17           (c)  The fund consists of fees and penalties collected under

9-18     this subchapter, interest on money in the fund, and money from

9-19     gifts, grants, or any other source intended to be used for the

9-20     purposes of this subchapter.

9-21           (d)  The fund shall be used only to:

9-22                 (1)  pay scrap [waste] tire facilities [processors],

9-23     [waste] whole scrap tire energy recovery facility, or scrap tire

9-24     recyclers owners or operators[, or waste tire recyclers] that meet

9-25     the requirements for payment under Section 361.477, 361.4771, or

 10-1    361.4772[, or 361.4773] and rules adopted under those sections;

 10-2                (2)  pay the commission's reasonable and necessary

 10-3    administrative costs of performing its duties under this subchapter

 10-4    as provided by Section 361.4774 [in an amount not to exceed six

 10-5    percent of the money annually accruing to the fund]; and

 10-6                (3)  pay the comptroller's reasonable and necessary

 10-7    administrative costs of performing the comptroller's duties under

 10-8    this subchapter as provided by Section 361.4774 [in an amount not

 10-9    to exceed two percent of the money annually accruing to the fund;]

10-10                [(4)  provide grants to waste tire energy recovery

10-11    facility owners or operators to cover equipment capital investment

10-12    costs and equipment installation costs to enable a facility to use

10-13    tire shreds as fuel; and]

10-14                [(5)  provide grants for recycling facility

10-15    construction costs].

10-16          (e)  Registration fees received under Section 361.4725 shall

10-17    be allocated to the commission for its reasonable and necessary

10-18    costs associated with the [reviewing applications for] registration

10-19    of a person required to register under that section [and with

10-20    registering:]

10-21                [(1)  fixed and mobile tire processing facilities and

10-22    storage sites;]

10-23                [(2)  waste tire energy recovery facilities and storage

10-24    sites; and]

10-25                [(3)  waste tire recyclers].

 11-1          (f)  The fund may not be used to reimburse shredding or

 11-2    burning of:

 11-3                (1)  innertubes;

 11-4                (2)  scrap rubber products;

 11-5                (3)  green tires;

 11-6                (4)  industrial solid waste, excluding scrap [waste]

 11-7    tires;

 11-8                (5)  oversized tires, as defined by commission rule,

 11-9    unless the oversized tires are collected from a priority

11-10    enforcement list site;

11-11                (6)  manufacturer reject tires; or

11-12                (7)  nonpneumatic tires.

11-13          (g)  The commission may classify special authorization tires,

11-14    as defined by commission rule, as priority enforcement list tires.

11-15          (h)  [The fund shall maintain a balance of not less than

11-16    $500,000.]

11-17          [(i)  If the commission has reason to believe that the

11-18    balance of money appropriated from the fund will fall below

11-19    $500,000, the commission may:]

11-20                [(1)  suspend the requirement to reimburse priority

11-21    enforcement list tires shredded in excess of the minimum percentage

11-22    identified in Section 361.477(c)(3)(C);]

11-23                [(2)  limit the number of waste tires for which a

11-24    processor, waste tire energy recovery facility owner or operator,

11-25    or waste tire recycler will be reimbursed; or]

 12-1                [(3)  discontinue paid carryover.]

 12-2          [(j)]  The revenues obtained from the scrap [waste] tire

 12-3    recycling fees shall be deposited to the credit of the scrap

 12-4    [waste] tire recycling fund and may be used only to pay for those

 12-5    activities and costs identified in Subsection (d) or (e).

 12-6          SECTION 7.  Section 361.477, Health and Safety Code, is

 12-7    amended to read as follows:

 12-8          Sec. 361.477.  PAYMENTS TO SCRAP [WASTE] TIRE FACILITIES AND

 12-9    WHOLE SCRAP TIRE ENERGY RECOVERY FACILITIES [processors].  (a)  The

12-10    commission each calendar month shall pay a scrap [waste] tire

12-11    facility [processor] that shreds scrap tires and meets the

12-12    requirements of this section and rules adopted under this section

12-13    an amount equal to the following:

12-14                      (A)  five cents per pound [80 cents] for each

12-15    pound of [weighed] tires generated from the Class I Region, and

12-16    which scrap tires were shredded by the processor during the

12-17    preceding calendar month; and

12-18                      (B)  five and one-half cents for each pound of

12-19    tires generated from the Class II Region, and which scrap tires

12-20    were shredded by the processor during the preceding calendar month.

12-21          (b)  The commission shall pay a whole scrap tire energy

12-22    recovery facility that meets the requirements of this section and

12-23    rules adopted under this section an amount equal to two cents per

12-24    pound of whole scrap tires actually put to end use by the facility.

12-25          (c)  [If the total number of used or scrap tires or tire

 13-1    pieces contained in illegal scrap tire sites that are identified on

 13-2    the priority enforcement list is below 2,500,000 tires, the]  The

 13-3    commission may pay [80 cents or] an appropriate amount determined

 13-4    by the commission for each pound [weighed tire] to scrap tire

 13-5    facilities or whole scrap tire energy recovery facilities

 13-6    [processors] with whom the commission has contracted to remove and

 13-7    transport to scrap tire facilities or whole scrap tire energy

 13-8    recovery facilities [shred] scrap tires and scrap tire pieces from

 13-9    priority enforcement list sites.  [The 2,500,000 tire limit does

13-10    not include those tires contained in sites under commission

13-11    enforcement or attorney general action or that require corrective

13-12    action or remedial action in response to a release or threat of

13-13    release of hazardous substances.]  In acting under this subsection,

13-14    the commission may contract with scrap tire facilities or whole

13-15    scrap tire energy recovery facilities [processors] on a regional or

13-16    site-specific basis.  The contracts shall be procured through a

13-17    competitive bid process conducted in accordance with the provisions

13-18    of the State Purchasing and General Services Act (Subtitle D, Title

13-19    10, Government Code [Article 601b, Vernon's Texas Civil Statutes])

13-20    applicable to contracts for services.  [Notwithstanding Subsection

13-21    (c), while the commission is using a competitive bid process for

13-22    assignment of sites listed on the priority enforcement list, the

13-23    priority enforcement list requirements of Subsection (c)(3)(C) do

13-24    not apply to an application for payment.  The commission may elect

13-25    not to enter into contracts under this subsection.  The contracts

 14-1    may be only for the removal and shredding of tires from priority

 14-2    enforcement list sites.]

 14-3          [(c)  A waste tire processor that desires to receive payment

 14-4    under this section for tires shredded by the processor during a

 14-5    calendar month must:]

 14-6                [(1)  apply to the commission for registration in

 14-7    accordance with forms prescribed by the commission;]

 14-8                [(2)  apply to the commission for payment on forms

 14-9    prescribed by the commission or, on a voluntary basis, apply by a

14-10    removable storage medium stored in an industry standard file format

14-11    acceptable to the commission;]

14-12                [(3)  demonstrate as required by rules adopted under

14-13    this section that:]

14-14                      [(A)  all tires for which payment is sought have

14-15    been shredded to an industry standard two-inch minus particle size

14-16    or, if approved by the commission, shredded to an alternative

14-17    particle size set by a contract requirement related to recycling or

14-18    end use of the particles;]

14-19                      [(B)  not less than 50 percent of those tires

14-20    were collected from generators, unless this requirement is

14-21    suspended by the commission on consideration of service needs

14-22    contained in a contract drafted under Subsection (b); and]

14-23                      [(C)  if the total number of whole used or scrap

14-24    tires or shredded tire pieces contained in illegal waste tire sites

14-25    that are identified on the priority enforcement list exceeds

 15-1    2,500,000 tires for more than 60 consecutive days, not less than 15

 15-2    percent and not more than 30 percent of those tires were collected

 15-3    from scrap tire sites listed on the priority enforcement list;]

 15-4                [(4)  provide any other information the commission

 15-5    determines is needed to accomplish the purposes of this subchapter,

 15-6    including a monthly report of scrap tires or tire pieces shredded,

 15-7    subtotaled by tire count or weight, for each generator number and

 15-8    priority enforcement list number;]

 15-9                [(5)  demonstrate that energy recovery activities in

15-10    the state are in compliance with applicable air emission control

15-11    rules and standards; and]

15-12                [(6)  provide financial assurance deemed adequate by

15-13    the commission that corresponds to:]

15-14                      [(A)  the payment appropriate for the number of

15-15    scrap tires the processor anticipates shredding in the next

15-16    calendar month; or]

15-17                      [(B)  the number of scrap tires the waste tire

15-18    storage site owner or operator anticipates accepting for storage in

15-19    the next calendar month.]

15-20          [(d)  A waste tire processor that in any month exceeds the

15-21    minimum requirement of Subsection (c)(3)(C) may receive credit only

15-22    for paid carryover in the amount in excess of the requirement that

15-23    may be used to meet the minimum requirement during a later month.

15-24    The commission by rule may prescribe the method of applying credits

15-25    accrued under this subsection.]

 16-1          [(e)  The commission by rule shall adopt application and

 16-2    payment procedures and requirements to implement this section.]

 16-3          [(f)]  Until the commission has determined that a scrap

 16-4    [waste] tire facility and whole scrap tire energy recovery facility

 16-5    owner or operator [processor] is in compliance with all applicable

 16-6    requirements, the commission may not authorize the scrap tire

 16-7    facility or whole scrap tire energy recovery facility owner or

 16-8    operator [processor] to process, burn or store scrap tires or tire

 16-9    pieces at a site at which the scrap tire facility or a whole scrap

16-10    tire energy recovery facility owner or operator [processor]

16-11    processes, burns or stores or intends to process, burn or store

16-12    scrap tires or tire pieces.

16-13          [(g)  Beginning January 1, 1996, the commission may reimburse

16-14    a processor for shredded scrap tires only if the processor has a

16-15    binding agreement to deliver the shredded scrap tires to a person

16-16    to recycle or reuse or to use for energy recovery within 180 days

16-17    after the date of reimbursement.  The commission shall suspend

16-18    subsequent shredding reimbursements to a processor that fails to

16-19    deliver the tire shreds to an identified end-use market before the

16-20    181st day after the date of reimbursement unless the executive

16-21    director determines that the failure to deliver was caused by an

16-22    act of God or by unforeseen business events.  The commission may

16-23    not resume suspended reimbursements until the processor makes all

16-24    delinquent deliveries.]

16-25          [(h)  The commission may not pay a waste tire processor for

 17-1    processing scrap tires if:]

 17-2                [(1)  the commission field office and central office

 17-3    program staff have not reviewed and approved for further processing

 17-4    by the commission all information submitted to the commission by

 17-5    the waste tire processor as required by Subsection (c) or rules

 17-6    adopted under this section; or]

 17-7                [(2)  the commission determines that the processor:]

 17-8                      [(A)  has not provided adequate financial

 17-9    assurance;]

17-10                      [(B)  does not have adequate fire protection; or]

17-11                      [(C)  is causing an imminent danger to public

17-12    health or welfare.]

17-13          [(i)  A waste tire processor that in any month exceeds the

17-14    generator percentage of the allocated number of waste tires

17-15    assigned for reimbursement purposes may accrue credit only for paid

17-16    generator carryover in the amount in excess of the requirement that

17-17    may be used to meet the allocation maximum during a later month.

17-18    The commission by rule may prescribe the method of applying

17-19    carryover credit accrued under this section.]

17-20          [(j)  The commission shall adopt rules to manage payments

17-21    from the fund to prevent depletion of the fund.  Rules adopted

17-22    under this subsection shall consider appropriate payments to

17-23    processors that reflect the varying amounts of money available in

17-24    the fund.  In any allocation adopted for processors under this

17-25    section, the commission shall consider the monthly average

 18-1    percentage of shredded tires the processor has forwarded to an

 18-2    end-use or recycling market.  In addition, the commission may

 18-3    consider the historical average number of tires for which the

 18-4    processor has been reimbursed and such other factors as may be

 18-5    determined by the commission.]

 18-6          [(k)  Notwithstanding Subsection (a), beginning September 1,

 18-7    1995, the commission shall reimburse a waste tire processor an

 18-8    additional five cents for each weighed tire if the commission

 18-9    determines that the processor has a binding agreement to deliver

18-10    100 percent of the scrap tires shredded by the processor monthly to

18-11    a person to recycle or reuse or to use for energy recovery and the

18-12    commission verifies that the processor has delivered the tire

18-13    shreds to such identified end-use market.  This section applies

18-14    only to a waste tire processor registered on January 1, 1995, and

18-15    that has a verified end market for the processor's tire shreds on

18-16    June 1, 1995.]

18-17          SECTION 8.  Sections 361.4771, 361.4772 and 361.4773 are

18-18    amended to read as follows:

18-19          Sec. 361.4771.  PAYMENTS TO SCRAP TIRE RECYCLERS [PAYMENT FOR

18-20    ENERGY RECOVERY FROM WHOLE WASTE TIRES OR SHREDDED TIRES].

18-21    (a)  The commission each calendar month shall pay a scrap tire

18-22    recycler that meets the requirements of this section and rules

18-23    adopted under this section an amount set forth in this subsection

18-24    for shredded scrap tires the scrap tire recycler actually puts to

18-25    an end use during the preceding calendar month.  The payment

 19-1    amounts are as follows for the following categories:

 19-2                (1)  a scrap tire energy recovery facility shall

 19-3    receive $30 per ton for shredded scrap tire pieces used for fuel at

 19-4    the facility:

 19-5                (2)  a scrap tire recycler which utilizes shredded tire

 19-6    pieces for civil engineering applications or practices, which

 19-7    practices include but are not limited to, landfill protective

 19-8    cover, landfill liner cover, landfill leachate collection systems,

 19-9    embankment construction, erosion control, road base material,

19-10    requested applications by political subdivisions, councils of

19-11    government, or any other application approved by the executive

19-12    director, shall receive $15 per ton;

19-13                (3)  scrap tire recyclers which engage in other

19-14    recycling applications, including tire-derived material, shall

19-15    receive $30 per ton, so long as the scrap tire recycler producing

19-16    the tire-derived material does not exceed 20 million pounds of

19-17    inventory of tire-derived material at any one time;

19-18                (4)  scrap tire recyclers which utilize shredded tire

19-19    pieces for septic system applications shall receive $10 per ton for

19-20    shredded tire pieces actually put to end use, provided that at

19-21    least 150 tons of shreds is actually put to end use in each

19-22    calendar quarter; and

19-23                (5)  scrap tire recyclers which recycle metal wire

19-24    derived from scrap tire pieces shall receive $10.00 per ton for

19-25    scrap tire wire actually put to an end use.

 20-1          Sec. 361.4772.  PROCEDURE FOR OBTAINING PAYMENT FOR SCRAP

 20-2    TIRE FACILITIES, WHOLE SCRAP TIRE ENERGY RECOVERY FACILITIES, AND

 20-3    SCRAP TIRE RECYCLERS; RESTRICTIONS; FUND MANAGEMENT.  [The

 20-4    commission shall adopt rules governing payments to waste tire

 20-5    energy recovery facilities for weighed tires used by the facility

 20-6    for fuel.  The rules must include rules governing registration and

 20-7    application procedures.  The rules must include a voluntary

 20-8    alternative process for making a payment application by the use of

 20-9    an industry standard file format removable storage medium.]

20-10          [(b)] (a)  To receive payment under this section and Sections

20-11    361.477, 361.4771 [361.4773], a scrap [waste] tire facility, whole

20-12    scrap tire energy recovery facility, and scrap tire recycler owner

20-13    or operator must:

20-14                (1)  apply to the commission for registration in the

20-15    manner and on forms prescribed by commission rule;

20-16                (2)  apply to the commission for payment:

20-17                      (A)  in a manner and on forms prescribed by

20-18    commission rule; or

20-19                      (B)  as a voluntary alternative, by use of a

20-20    removable storage medium stored in an industry standard file format

20-21    acceptable to the commission;

20-22                (3)  demonstrate that all tires or tire pieces for

20-23    which the scrap tire facility, whole scrap tire energy recovery

20-24    facility and scrap tire recycler [owner or operator] applies for

20-25    payment are whole scrap [waste] tires or shredded tires;

 21-1                (4)  send the commission a monthly report of the number

 21-2    of pounds of whole waste tires or shredded tires, or tire-derived

 21-3    material put to actual end use [used for energy recovery],

 21-4    subtotaled by [tire count or by] weight attributed to each

 21-5    generator number or priority enforcement list number;

 21-6                (5)  demonstrate that any [the] energy recovery

 21-7    activities comply with applicable air emission control standards

 21-8    and rules;

 21-9                (6)  submit evidence of financial responsibility in an

21-10    amount adequate to assure proper cleanup and closure of the

21-11    facility, if the person anticipates accepting an amount of whole

21-12    scrap tires, shredded tire pieces, or tire-derived material for

21-13    storage that exceeds the facility's 30-day supply; and

21-14                (7)  [if the number of whole used or scrap tires or

21-15    shredded tire pieces contained in illegal waste tire sites that are

21-16    identified on the priority enforcement list exceeds 2,500,000 tires

21-17    for more than 60 consecutive days, demonstrate that not less than

21-18    15 percent and not more than 30 percent of the tires used for

21-19    energy recovery at the facility were collected from scrap tire

21-20    sites listed on the priority enforcement list; and]

21-21                [(8)]  provide any other information required by

21-22    commission rule.

21-23          (b) [(c)]  A scrap [waste] tire energy recovery facility, or

21-24    whole scrap tire energy recovery facility, may not store in excess

21-25    of a 30-day supply of whole scrap [waste] tires, [or] shredded

 22-1    tires or tire-derived material at a site at which the owner or

 22-2    operator intends to burn or store waste tires, [or] shredded tire

 22-3    pieces, or tire-derived material [tires] until the facility is

 22-4    registered by the commission as a scrap [waste] tire energy

 22-5    recovery facility storage site or a whole scrap tire energy

 22-6    recovery facility storage site.  A scrap tire recycler may not

 22-7    store in excess of a 30-day supply of whole scrap tires, shredded

 22-8    tire pieces, or tire-derived material at a site at which the

 22-9    recycler intends to recycle or store whole scrap tires, shredded

22-10    tire pieces, or tire-derived material until the facility is

22-11    registered by the commission as a scrap tire recycler storage site.

22-12          (c) [(d)]  The commission may not pay a whole scrap [waste]

22-13    tire energy recovery facility owner or operator for actual end use

22-14    of whole scrap [using waste] tires, [or] shredded tire pieces, or

22-15    tire-derived material [tires] if:

22-16                (1)  the commission field office and central office

22-17    program staff have not reviewed and approved for further processing

22-18    by the commission all information submitted to the commission by

22-19    the whole scrap [waste] tire energy recovery facility owner or

22-20    operator as required by Subsection (a) [(b)] or rules adopted under

22-21    this section;

22-22                (2)  the commission determines that the facility:

22-23                      (A)  has not provided adequate financial

22-24    assurance;

22-25                      (B)  does not have adequate fire protection; or

 23-1                      (C)  is causing an imminent danger to public

 23-2    health or welfare;

 23-3                (3)  the facility does not have appropriate

 23-4    authorization from the commission to:

 23-5                      (A)  perform scrap [waste] tire energy recovery

 23-6    at the energy recovery facility site if the end user is a scrap

 23-7    tire energy recovery facility owner or operator; or

 23-8                      (B)  recycle scrap tires, shredded tire pieces,

 23-9    or tire-derived material at the recycling site if the end user is a

23-10    scrap tire recycler; or

23-11                (4)  the facility is not physically capable of

23-12    performing:

23-13                      (A)  scrap [waste] tire energy recovery if the

23-14    end user is a scrap tire energy recovery facility owner or

23-15    operator; or

23-16                      (B)  scrap tire recycling, if the end user is a

23-17    scrap tire recycler.

23-18          (d)  The commission may not pay a scrap tire facility for

23-19    shredded tire pieces or tire-derived material if:

23-20                (1)  the commission field office and central office

23-21    program staff have not reviewed and approved for further processing

23-22    by the commission all information submitted to the commission by

23-23    the scrap tire facility as required by Subsection (a) or rules

23-24    adopted under this section;

23-25                (2)  the commission determines that the scrap tire

 24-1    facility:

 24-2                      (A)  has not provided adequate financial

 24-3    assurance;

 24-4                      (B)  does not have adequate fire protection; or

 24-5                      (C)  is causing an imminent danger to public

 24-6    health or welfare;

 24-7                (3)  the scrap tire facility does not have appropriate

 24-8    authorization from the commission to perform processing operations

 24-9    at the facility; or

24-10                (4)  the scrap tire facility is not physically capable

24-11    of performing processing operations at the facility.

24-12          (e)  The commission may not pay a scrap tire recycler for

24-13    whole scrap tires, shredded tire pieces, or tire-derived material

24-14    if the commission determines that the whole scrap tires, shredded

24-15    tire pieces, or tire-derived material:

24-16                (1)  are not being utilized for legitimate end use

24-17    purposes; or

24-18                (2)  delivered from out of state to be used in state.

24-19          (f) [(e)]  The commission shall adopt rules to manage

24-20    payments from the fund to prevent depletion of the fund as follows:

24-21                (1)  the commission shall pay scrap tire facilities and

24-22    whole scrap tire energy facilities who have established end use

24-23    markets and have not exceed their registered storage capacity under

24-24    this section before using any allocation method authorized by this

24-25    subchapter and before making other payments from the fund to other

 25-1    uses authorized by this subchapter.

 25-2                (2)  the commission shall pay scrap tire recyclers for

 25-3    whole tires, shredded tire pieces or tire-derived material that is

 25-4    actually put to end use provided that:

 25-5                      (A)  the commission does not exceed $5,000,000

 25-6    dollars per fiscal year; and

 25-7                      (B)  the commission shall pay out no more than

 25-8    $420,000 per calendar month;

 25-9                      (C)  any unspent funds remaining at the end of

25-10    the calendar month shall roll forward to the following month;

25-11                      (D)  scrap tire recyclers which exceed the

25-12    maximum annual or calendar month payment requirement of Subsection

25-13    (f)(2)(A) and (B) for whole tires, shredded tires pieces or

25-14    tire-derived material put to actual end use shall receive a credit

25-15    which shall carryover to the following calendar month or fiscal

25-16    year.

25-17                (3)  the commission shall use the balance of the fund

25-18    for priority enforcement list site remediation, research grants to

25-19    state entities for the use of shreds in civil engineering

25-20    application, or any other use the commission deems necessary.

25-21          (g)  In this section, "30-day supply" means an amount equal

25-22    to the average of the amount of tires consumed for energy recovery

25-23    or legitimately recycled in each of the six months immediately

25-24    preceding the month for which the supply is being computed.

25-25    [Before using any allocation method authorized by this subchapter

 26-1    and before making other payments from the fund, the commission

 26-2    shall pay reimbursements to processors under Section 361.477 who

 26-3    have established end-use markets and pay reimbursements under this

 26-4    section and Sections 361.4772 and 361.4773.]

 26-5          Sec. 361.4773.  STORED TIRES.  (a)  A scrap tire storage

 26-6    facility shall not exceed the registered storage capacity approved

 26-7    by the commission.

 26-8          (b)  A scrap tire storage facility that does not meet the

 26-9    requirement of Subsection (a) shall immediately cease accepting

26-10    additional whole scrap tires or shredded tire pieces.

26-11          [Sec. 361.4772.  RECYCLING FACILITY CONSTRUCTION GRANT.

26-12    (a)  The commission by rule shall establish a program for providing

26-13    grants for the construction of waste tire recycling facilities for

26-14    the recycling of whole waste tires or shredded tires.]

26-15          [(b)  The commission may not expend more than $2 million each

26-16    year for grants under this section.]

26-17          [(c)  A facility constructed with a grant under this section

26-18    is not eligible for reimbursement for:]

26-19                [(1)  powdered rubber;]

26-20                [(2)  a tire-derived fuel;]

26-21                [(3)  buffing dust;]

26-22                [(4)  a retreaded or recapped tire; or]

26-23                [(5)  a product that is ineligible for reimbursement

26-24    under commission rules.]

26-25          [(d)  The commission shall require a grant recipient to:]

 27-1                [(1)  demonstrate that not less than 15 percent and not

 27-2    more than 30 percent of the tires used for energy recovery at the

 27-3    facility were collected from scrap tire sites listed on the

 27-4    priority enforcement list if the number of whole used or scrap

 27-5    tires or shredded tire pieces contained in illegal waste tire sites

 27-6    that are identified on the priority enforcement list exceeds

 27-7    2,500,000 tires for more than 60 consecutive days; and]

 27-8                [(2)  submit evidence of financial responsibility in an

 27-9    amount adequate to assure proper cleanup and closure of the

27-10    facility, if the recipient anticipates accepting an amount of whole

27-11    waste tires or shredded tire pieces for storage that exceeds the

27-12    facility's 30-day supply.]

27-13          [Sec. 361.4773.  PAYMENT FOR SHREDDED WASTE TIRE ENERGY

27-14    RECOVERY FACILITY.  (a)  The commission each month shall pay to a

27-15    waste tire energy recovery facility owner or operator that burns

27-16    shredded tires in compliance with an energy recovery permit issued

27-17    by the commission an amount equal to 40 cents for each weighed tire

27-18    the facility used for energy recovery during the preceding month.]

27-19          [(b)  To receive payment under this section, a retrofitted

27-20    waste tire energy recovery facility owner or operator must:]

27-21                [(1)  apply to the commission for payment in a manner

27-22    and on forms prescribed by commission rule; and]

27-23                [(2)  comply with applicable rules adopted by the

27-24    commission under this section and Section 361.4771, unless

27-25    otherwise indicated by the energy recovery permit issued by the

 28-1    commission.]

 28-2          SECTION 9.  Section 361.4774, Health and Safety Code, is

 28-3    amended to read as follows:

 28-4          Sec. 361.4774.  [LIMITED USE OF WASTE TIRE RECYCLING FUND;

 28-5    GRANTS, REIMBURSEMENT, AND] ADMINISTRATIVE EXPENSES.  (a)  For

 28-6    performing duties related to the scrap [waste] tire program, each

 28-7    fiscal year the comptroller may expend [up to $680,000 or] an

 28-8    amount equal to not more than two percent of the monthly annually

 28-9    accruing to the scrap [waste] tire [recovery] fund[, whichever is

28-10    greater].

28-11          (b)  For administering the scrap [waste] tire recycling

28-12    program, each fiscal year the commission may expend [not more than

28-13    the lesser of $2.05 million or] an amount equal to not more than

28-14    six percent of the amount annually accruing to [appropriated from]

28-15    the scrap [waste] tire recycling fund for the administration and

28-16    operation of the scrap [waste] tire recycling program.

28-17          [(c)  Each fiscal year, the commission may expend not more

28-18    than:]

28-19                [(1)  $1.4 million for paying accrued carryover credits

28-20    as provided by Section 361.499;]

28-21                [(2)  $15.2 million for tire shredding under Section

28-22    361.477;]

28-23                [(3)  $3.52 million for the cleanup and closure of

28-24    priority enforcement list tire sites as provided by Sections

28-25    361.476 and 361.477;]

 29-1                [(4)  $2 million for providing recycling facility

 29-2    construction grants under Section 361.4772;]

 29-3                [(5)  $600,000 for payments to energy recovery

 29-4    facilities under Section 361.4773 at a rate of 40 cents per weighed

 29-5    tire unit; and]

 29-6                [(6)  $6 million to provide grants for retrofitting

 29-7    facilities to use whole or shredded tires for fuel or for paying

 29-8    for facilities to use whole tires for fuel as provided by

 29-9    Subsections (d) and (e).]

29-10          [(d)  For fiscal year 1996, the commission may expend not

29-11    more than $4 million for:]

29-12                [(1)  providing grants to waste tire energy recovery

29-13    facilities that are not using tire-derived fuel and apply for

29-14    assistance to cover retrofitting costs the commission determines

29-15    are necessary to enable the facilities to use whole tires as fuel;

29-16    and]

29-17                [(2)  paying a facility eligible for a grant under

29-18    Subdivision (1), but for which the commission has not made a grant,

29-19    an amount of up to 80 cents per weighed tire unit.]

29-20          [(e)  A person receiving payments for weighed tires under

29-21    Subsection (d)(2) may not receive reimbursements that exceed the

29-22    total of:]

29-23                [(1)  the amount of the retrofitting costs the facility

29-24    would have received if the person had applied for a grant under

29-25    Subsection (d)(1); and]

 30-1                [(2)  the cost, as determined by the commission, of

 30-2    transporting to the facility the number of whole tires used for

 30-3    fuel until the payments under Subsection (d)(2) equal the amount of

 30-4    the retrofitting costs the facility would have received.]

 30-5          [(f)  For fiscal year 1996, the commission may expend not

 30-6    more than $2 million to provide grants to waste tire energy

 30-7    recovery facilities that are not using tire-derived fuel and apply

 30-8    for assistance to cover retrofitting costs the commission

 30-9    determines are necessary to enable the facilities to use shredded

30-10    tires as fuel.]

30-11          [(g)  For the period beginning September 1, 1996, and ending

30-12    December 31, 1997, the commission may expend not more than $6

30-13    million for payments to waste tire energy recovery facilities that

30-14    burn whole tires at a rate of 80 cents per weighed tire unit used.]

30-15          [(h)  After the third quarter of each year of the fiscal

30-16    biennium, funds that remain unused for the purposes specified in

30-17    Subsections (a)-(g) may be transferred for use for a purpose

30-18    specified in Subsections (c)-(g) at the discretion of the

30-19    commission to promote recycling and energy recovery.]

30-20          SECTION 10.  Section 361.479, Health and Safety Code, is

30-21    amended to read as follows:

30-22          Sec. 361.479.  EVIDENCE OF FINANCIAL RESPONSIBILITY.  (a)  A

30-23    person required to register under Section 361.4725 [waste tire

30-24    storage facility registered by the commission or a waste tire

30-25    facility that accepts shredded scrap tires for storage or for

 31-1    processing for recycling, reuse, or energy recovery] shall submit

 31-2    to the commission and shall maintain evidence of financial

 31-3    responsibility in an amount adequate to assure proper cleanup and

 31-4    closure of the facility.

 31-5          (b)  A scrap [waste] tire [recycling] facility owner or

 31-6    operator who anticipates accepting for storage an amount of whole

 31-7    scrap tires, shredded tire pieces, or tire-derived material [for

 31-8    storage] that exceeds the facility's 30-day supply shall submit to

 31-9    the commission and shall maintain evidence of financial

31-10    responsibility in an amount adequate to assure proper cleanup and

31-11    closure of the facility.

31-12          (c)  A facility subject to Subsection (a) or (b) shall submit

31-13    to the commission an estimate of the total amount of whole scrap

31-14    tires, shredded tire pieces, or tire-derived material measured by

31-15    pounds [weighed tire] that the facility will store or process, the

31-16    maximum number of out-of-state tires the facility will store, and

31-17    the estimated cost, using that total amount, of cleaning up and

31-18    closing the facility.

31-19          (d)  The commission shall evaluate and may amend an estimate

31-20    submitted under Subsection (c) and shall determine for each

31-21    facility the amount for which evidence of financial responsibility

31-22    is required.  The commission periodically may audit a facility

31-23    subject to this section and may increase the amount for which the

31-24    facility is required to provide evidence of financial

31-25    responsibility.  The commission may suspend the registration of, or

 32-1    payments under Sections 361.477 and 361.4771 to, a facility that

 32-2    does not provide evidence of financial responsibility for an

 32-3    increased amount required under this section.

 32-4          (e)  Evidence of financial responsibility may be in the form

 32-5    of:

 32-6                (1)  a performance bond or a letter of credit

 32-7    acceptable to the commission that is from a financial institution,

 32-8    a trust fund, or insurance for a privately owned facility; or

 32-9                (2)  a self-insurance test designed by the commission

32-10    for a publicly owned facility.  A person who makes an initial

32-11    request for reimbursement from the scrap [waste] tire recycling

32-12    fund on or after September 1, 1993, must provide evidence of

32-13    financial responsibility for the full amount determined under

32-14    Subsection (d).

32-15          (f)  A person who files an application or amended application

32-16    for registration under this subchapter on or after September 1,

32-17    1997, must provide evidence of financial responsibility:

32-18                (1)  in an amount adequate to assure proper cleanup and

32-19    closure of the facility for which registration is requested; and

32-20                (2)  in a form prescribed by commission rule that may

32-21    be used to pay for the proper cleanup and closure of that facility.

32-22          SECTION 11.  Subchapter P, Chapter 361, Health and Safety

32-23    Code, is amended by adding Sections 361.4791 and 361.4792 to read

32-24    as follows:

32-25          Sec. 361.4791.  LIEN.  (a)  All remediation costs incurred by

 33-1    the commission for the cleanup and closure of a site for which

 33-2    insufficient financial assurance has been provided constitute a

 33-3    lien in favor of the state on the property on which the site is

 33-4    located.

 33-5          (b)  The lien arises and attaches on the date a commission

 33-6    affidavit is filed with the county clerk in the county in which the

 33-7    site is located.  The affidavit shall state the name of the owner

 33-8    of the property, the amount owed, and the legal description of the

 33-9    property.  The county clerk shall file an affidavit relating to the

33-10    site in the real property records of the county in which the

33-11    property is located.

33-12          (c)  The lien is subordinate to the rights of prior bona fide

33-13    purchasers of or lienholders on the property.

33-14          Sec. 361.4792.  NOTICE OF BANKRUPTCY.  (a)  Not later than

33-15    the second business day after the filing of a voluntary petition in

33-16    bankruptcy by a scrap tire processor, scrap tire end user, or scrap

33-17    tire transporter or the filing of an involuntary bankruptcy

33-18    petition for relief against a scrap tire processor, scrap tire end

33-19    user, or scrap tire transporter, the scrap tire processor, scrap

33-20    tire end user, or scrap tire transporter shall deliver to the

33-21    bankruptcy program department of the commission in Austin written

33-22    notice of the bankruptcy stating the case number and the bankruptcy

33-23    court where the case is pending.

33-24          (b)  Not later than the second business day after the date

33-25    the document is filed with the bankruptcy clerk's office in a

 34-1    bankruptcy case described in Subsection (a), the scrap tire

 34-2    processor, scrap tire end user, or scrap tire transporter shall

 34-3    deliver to the bankruptcy program department of the commission a

 34-4    copy of:

 34-5                (1)  any schedule or statement of affairs;

 34-6                (2)  any amended schedule or statement of affairs; or

 34-7                (3)  any monthly operating report.

 34-8          SECTION 12.  Sections 361.481 and 361.482, Health and Safety

 34-9    Code, are amended to read as follows:

34-10          Sec. 361.481.  PROHIBITION ON OUT-OF-STATE TIRES; PENALTY.

34-11    (a)  A scrap [waste] tire facility, scrap tire recycler or whole

34-12    scrap tire energy recovery facility [processor] may not claim

34-13    payment under this subchapter [Section 361.477] for shredding,

34-14    burning or recycling out-of-state tires.  [A waste tire energy

34-15    recovery facility owner or operator may not claim payment under

34-16    Section 361.4771 or 361.4773 for burning out-of-state tires.  A

34-17    waste tire recycler may not claim payment under Section 361.4772

34-18    for recycling out-of-state tires.]

34-19          (b)  A scrap [waste] tire generator that the commission

34-20    determines has used a manifest and commission generator number to

34-21    pass out-of-state tires is subject to an [not eligible for the free

34-22    collection and transportation of waste tires generated at the

34-23    generator's place of business.  In addition to any] administrative,

34-24    civil, or criminal enforcement action[, the commission shall

34-25    require the generator to pay for:]

 35-1                [(1)  collection and transportation of generated tires;

 35-2    and]

 35-3                [(2)  shredding, burning, or recycling of generated

 35-4    tires at the applicable rate specified in Section 361.477,

 35-5    361.4771, or 361.4772].

 35-6          (c)  A scrap [waste] tire facility [processor], whole scrap

 35-7    [waste] tire energy recovery facility owner or operator, or scrap

 35-8    [waste] tire recycler who the commission determines has knowingly

 35-9    accepted out-of-state tires on manifests using a commission

35-10    generator number is subject to an administrative, civil, or

35-11    criminal enforcement action.

35-12          (d)  A scrap [waste] tire transporter that the commission

35-13    determines has transported out-of-state tires using a

35-14    commission-approved manifest or transporter number is subject to an

35-15    administrative, civil, or criminal enforcement action.

35-16          (e)  The commission shall treat whole scrap tires and

35-17    shredded scrap tire pieces generated in Texas, removed from Texas,

35-18    and subsequently reintroduced in Texas as out-of-state scrap tires

35-19    for the purposes of this subchapter.

35-20          Sec. 361.482.  PROHIBITION ON DISPOSAL OF [SHREDDED] TIRES IN

35-21    LANDFILL.  (a)  Except as provided by Subsection (b), a [A] person

35-22    may not dispose of in-state or out-of-state whole used tires, [or]

35-23    scrap tires, [that are eligible for reimbursement under this

35-24    chapter] or shredded tire pieces [for which reimbursement has been

35-25    paid under this subchapter] in a landfill, including a Type VIII-S

 36-1    tire monofill.

 36-2          (b)  In an emergency, the commission may by rule authorize

 36-3    the landfill disposal of scrap tires that have been quartered or

 36-4    shredded tire pieces until the commission determines that there are

 36-5    sufficient uses for scrap tires being generated in this state.

 36-6          SECTION 13.  Subchapter P, Chapter 361, Health and Safety

 36-7    Code, is amended by adding Section 361.4825 to read as follows:

 36-8          Sec. 361.4825.  INTENTIONAL BURNING PROHIBITED; DUMPING

 36-9    PROHIBITED; CRIMINAL PENALTY.  (a)  A person commits an offense if

36-10    the person starts a fire with the intent to destroy or damage whole

36-11    scrap tires, tire pieces, or tire-derived products stored at a:

36-12                (1)  scrap tire generator;

36-13                (2)  scrap tire facility;

36-14                (3)  whole scrap tire energy recovery facility;

36-15                (4)  scrap tire recycling facility; or

36-16                (5)  priority enforcement list site.

36-17          (b)  It is an exception to the application of Subsection

36-18    (a)(3) that the fire was started at a registered scrap tire energy

36-19    recovery facility in the course of an energy recovery procedure

36-20    authorized under this subchapter.

36-21          (c)  A person commits an offense if the person disposes of

36-22    more than 100 whole tires or an equivalent amount of scrap tire

36-23    pieces at a site that is not authorized by the commission to accept

36-24    whole tires or scrap tire pieces.

36-25          (d)  An offense under this section is a felony of the second

 37-1    degree.

 37-2          (e)  In addition to the criminal penalty provided by this

 37-3    section, a person who commits an offense under this section is

 37-4    subject to a civil penalty under Section 361.483.

 37-5          SECTION 14.  Sections 361.483(a) and (c), Health and Safety

 37-6    Code are amended to read as follows:

 37-7    (a)  A person who violates this subchapter or a rule adopted or

 37-8    order issued under this subchapter is liable for a civil penalty of

 37-9    not less than $100 or more than $25,000; [up to $10,000] for each

37-10    violation and for each day of a continuing violation.

37-11          (c)  A penalty collected under this section shall be

37-12    deposited to the credit of the scrap [waste] tire recycling fund.

37-13          SECTION 15.  Section 361.4832, Health and Safety Code, is

37-14    amended to read as follows:

37-15          Sec. 361.4832.  ADMINISTRATIVE PENALTY; ORDER FOR CORRECTIVE

37-16    ACTION; SUSPENSION OF REGISTRATION.  (a)  If a person violates this

37-17    subchapter or a rule adopted or order issued under this subchapter

37-18    the commission may:

37-19                (1)  assess against the person an administrative

37-20    penalty under Section 361.252 in an amount not to exceed $10,000

37-21    for each act of violation and for each day of violation; or

37-22                (2)  order the person to take a corrective action.

37-23          (b)  The commission may suspend a registration issued under

37-24    this subchapter and may suspend payment under Section 361.477 or

37-25    361.4771 to a scrap [of or reimbursement payment to a waste tire

 38-1    processor, waste tire transporter, waste tire generator, waste]

 38-2    tire [recycling] facility, or whole scrap [waste] tire energy

 38-3    recovery facility, or scrap tire recycler on the initiation of an

 38-4    enforcement proceeding and while the proceeding is pending for the

 38-5    violation of this subchapter or a rule adopted or order issued

 38-6    under this subchapter.

 38-7          SECTION 16.  Section 361.485(b), Health and Safety Code, is

 38-8    amended to read as follows:

 38-9          (b)  The commission shall include in the report the

38-10    commission's (recommendation, based on the commission's evaluation)

38-11    adjustment to compensate for the rate of inflation made pursuant to

38-12    Section 361.4851 during the preceding two years[, as to whether an

38-13    adjustment] to the fee assessed on the sale of tires or to the rate

38-14    of reimbursement paid to a scrap [waste] tire facility [processor],

38-15    or whole scrap [waste] tire energy recovery facility, or scrap tire

38-16    recycler owner or operator [is warranted].

38-17          SECTION 17.  Subchapter P. Chapter 361, Health and Safety

38-18    Code, is amended by adding a new Section 361.4851 to read as

38-19    follows:

38-20          Sec. 361.4851.  ADJUSTMENTS DUE TO INFLATION.  The commission

38-21    shall biannually adjust the reimbursements paid under this

38-22    subchapter to a scrap tire facility, whole scrap tire energy

38-23    recovery facility, or a scrap tire recycler in an equivalent amount

38-24    to reflect changes in inflation occurring as measured by the U.S.

38-25    Consumer Products Index (CPI).  The base for the adjustment shall

 39-1    be the CPI as it exists on September 1, 1997.

 39-2          SECTION 18.  Section 361.486, Health and Safety Code, is

 39-3    amended to read as follows:

 39-4          Sec. 361.486.  RECYCLING EFFORTS.  (a)  Notwithstanding

 39-5    Section 361.496, on and after January 1, 1996, each applicant for a

 39-6    new, amended, and renewal processing registration and each existing

 39-7    processor must identify those persons who will accept the

 39-8    processor's shredded tire pieces for recycling or reuse or to use

 39-9    the shredded scrap tires for energy recovery.  The commission may

39-10    not require that the processor provide a copy of the contract, or

39-11    provide any of the contract terms, between the processor and the

39-12    end user.  The commission shall reimburse a processor for only

39-13    those shredded tires that the executive director [commission]

39-14    determines are committed to a legitimate end user.  When a scrap

39-15    tire facility or scrap tire recycler submits an application for end

39-16    use approval, the executive director shall act upon the request for

39-17    approval within 90 days from the date of filing, and in writing

39-18    notify the application stating the executive director's reasons for

39-19    or against approval.

39-20          (b)  The commission may disapprove of the use a person

39-21    identified by the processor has for the tire pieces unless the

39-22    person identified is authorized by the state to use tire-derived

39-23    fuel for energy recovery or is a scrap tire recycler.

39-24          (c)  The commission by rule shall define recycling for

39-25    purposes of this subchapter.

 40-1          (d)  On or before January 1, 1994, and on a semiannual basis

 40-2    thereafter, registered scrap tire facilities, scrap tire recyclers,

 40-3    and whole scrap tire energy recovery facility [processors and

 40-4    storage site] owners and operators shall report their recycling,

 40-5    reuse, and energy recovery activities to the commission.  The

 40-6    commission by rule shall prescribe the form and other requirements

 40-7    of the report.

 40-8          (e)  A person who, in this state, recycles or recovers the

 40-9    energy from shredded tire pieces shall register with the commission

40-10    in accordance with the rules and on the forms prescribed by the

40-11    commission.

40-12          SECTION 19.  Section 361.487, Health and Safety Code, is

40-13    amended to read as follows:

40-14          Sec. 361.487.  PAYMENTS TO OUT-OF-STATE END USERS

40-15    [REIMBURSEMENT RESTRICTIONS].  (a)  The commission by rule may

40-16    provide for payments under Sections 361.477 and 361.4771 to an end

40-17    user outside the state boundaries of Texas.  [A processor seeking

40-18    reimbursement under Section 361.477 shall process and store the

40-19    whole used or scrap tires or shredded tire pieces in the state.  A

40-20    waste tire energy recovery facility owner or operator seeking

40-21    reimbursement under Section 361.4771 or 361.4773 shall store and

40-22    burn the whole used or scrap tires or shredded tire pieces in the

40-23    state.]

40-24          (b)  The rules must require an end user outside the state

40-25    boundaries of Texas to demonstrate that whole scrap tires, shredded

 41-1    tire pieces, or tire-derived material for which payment is

 41-2    requested were:

 41-3                (1)  generated and collected in this state;

 41-4                (2)  transported out of this state and delivered to the

 41-5    end user outside the state boundaries of Texas; and

 41-6                (3)  actually put to end use by the end user outside

 41-7    the state boundaries of Texas [commission shall treat whole used or

 41-8    scrap tires and shredded tire pieces generated in Texas, removed

 41-9    from Texas, and subsequently reintroduced to Texas as out-of-state

41-10    scrap tires for the purposes of this subchapter].

41-11          SECTION 20.  Section 361.489(a) and (e), Health and Safety

41-12    Code, are amended to read as follows:

41-13          (a)  The commission may, with the funds available to the

41-14    commission from the scrap [waste] tire recycling fund, undertake

41-15    immediate remediation of a site if, after investigation, the

41-16    commission finds:

41-17                (1)  that there exists a situation caused by the

41-18    [illegal dumping of] scrap tires that is causing or may cause

41-19    imminent and substantial endangerment to the public health and

41-20    safety or the environment; and

41-21                (2)  the immediacy of the situation makes it

41-22    prejudicial to the public interest to delay action until an

41-23    administrative order can be issued to potentially responsible

41-24    parties or until a judgment can be entered in an appeal of an

41-25    administrative order.

 42-1          (e)  Money collected in a suit to recover costs shall be

 42-2    deposited to the credit of the scrap [waste] tire recycling fund.

 42-3          SECTION 21.  Section 361.490, Health and Safety Code, is

 42-4    amended to read as follows:

 42-5          Sec. 361.490.  ACCESS TO PRIORITY ENFORCEMENT LIST SITE.

 42-6    [(a)]  Members of the commission or (,) employees or agents of the

 42-7    commission[, and authorized processors or their subcontractors] are

 42-8    entitled to enter any public or private property at any reasonable

 42-9    time for the purpose of inspecting, investigating, or remediating

42-10    any condition related to illegal dumping of scrap tires.  [An

42-11    authorized processor or subcontractor is entitled to enter property

42-12    only if the commission directs the processor or subcontractor to

42-13    enter the property.]  The executive director shall give notice of

42-14    intent to enter private property for those purposes by certified

42-15    mail to the last known address indicated in the current county

42-16    property records at least 10 days before a commission member,

42-17    commission employee or agent[, or authorized processor or

42-18    subcontractor] enters the property.  A commission member,

42-19    commission employee or agent[, or authorized processor or

42-20    subcontractor] who, acting under this subsection, enters private

42-21    property shall:

42-22    (1)  observe the establishment's rules concerning safety, internal

42-23    security, and fire protection; and

42-24    (2)  if the property has management in residence, make a reasonable

42-25    attempt to notify the management or person in charge of the entry

 43-1    and exhibit credentials.

 43-2          [(b)  Authorized processors and their subcontractors may not

 43-3    be considered agents of the state and are solely responsible for

 43-4    their actions.]

 43-5          SECTION 22.  Sections 361.494-361.496, Health and Safety Code

 43-6    are amended to read as follows:

 43-7          Sec. 361.494.  Appeal.  The commission shall establish a

 43-8    process by which a registered scrap tire facility or the owner or

 43-9    operator of a registered whole scrap [waste] tire energy recovery

43-10    facility, or a registered scrap tire recycler [processor] who is

43-11    adversely affected by an agency decision affecting reimbursement

43-12    may appeal that decision to the executive director or the

43-13    commission.

43-14          Sec. 361.495.  Fiscal Audits.  The commission biennially

43-15    shall perform a fiscal audit of each person receiving

43-16    reimbursements under Sections 361.477 and 361.4771 [waste tire

43-17    processor, waste tire recycling facility, and waste tire energy

43-18    recovery facility owner or operator] to ensure fiscal

43-19    responsibility and accountability regarding reimbursements made

43-20    under Sections 361.477, and 361.4771[, and 361.4773.  The person

43-21    audited shall bear the costs of the audits].

43-22          Sec. 361.496.  New or Expanded Processing Operation.  A scrap

43-23    tire facility [new processor], whole scrap [waste] tire energy

43-24    recovery facility, or scrap [waste] tire recycler or a registered

43-25    scrap tire facility, whole scrap [processor, waste] tire energy

 44-1    recovery facility, or scrap [waste] tire recycler that seeks to

 44-2    establish a new processing facility or expand a processing

 44-3    operation in the state must:

 44-4                (1)  certify that such scrap tire facility, whole

 44-5    [processor, waste] tire energy recovery facility, or scrap [waste]

 44-6    tire recycler is willing to provide collection and transportation

 44-7    of scrap [waste] tires from registered generators in rural counties

 44-8    of the state at the request of the commission during emergency

 44-9    periods as defined by the commission when such generators are not

44-10    being otherwise served by registered processors or transporters;

44-11    and

44-12                (2)  identify and have available a certified end use in

44-13    the application for a new or amended registration.

44-14          SECTION 23.  Section 361.498 is amended to read as follows:

44-15          Sec. 361.498.  Community Service.  Persons seeking

44-16    reimbursement from the scrap [waste] tire recycling fund shall

44-17    perform community service on an annual basis.  Community service

44-18    includes cooperation with local civic groups to clean up abandoned

44-19    tire sites that are not classified as priority enforcement list

44-20    sites.  The tires collected under this section are eligible for

44-21    reimbursement.

44-22          SECTION 24.  Sections 361.478, 361.486, 361.4865, and

44-23    361.499, Health and Safety Code, are repealed.

44-24          SECTION 25.  (a)  As soon as practicable after September 1,

44-25    1997, the Texas Natural Resource Conservation Commission shall

 45-1    inventory the amount and location of:

 45-2                (1)  shredded tire pieces in this state; and

 45-3                (2)  whole scrap tires in priority enforcement list

 45-4    sites in the state.

 45-5          (b)  Not later than December 1, 1997, the Texas Natural

 45-6    Resource Conservation Commission shall adopt the rules necessary to

 45-7    implement Subchapter P, Chapter 361, Health and Safety Code, as

 45-8    amended by this Act.

 45-9          SECTION 26.  (a)  Any unappropriated, unexpended, and

45-10    unencumbered money available in the scrap tire recycling fund on

45-11    September 1, 1997, is appropriated to the Texas Natural Resource

45-12    Conservation Commission to be used only for payments under Sections

45-13    361.477 and 361.4771, Health and Safety Code, as amended by this

45-14    Act, for:

45-15                (1)  shredded tire pieces identified in the inventory

45-16    conducted under Section 22(a) of this Act; or

45-17                (2)  whole scrap tires from a priority enforcement list

45-18    site identified in the inventory conducted under Section 22(a) of

45-19    this Act.

45-20          (b)  The payments authorized under subsection (a) of this

45-21    section apply only to whole scrap tires or shredded tire pieces

45-22    actually put to end use on or after January 1, 1998.

45-23          SECTION 27.  (a)  Except as otherwise provided by this Act,

45-24    this Act takes effect September 1, 1997.

45-25          (b)  Section 361.4725(c), Health and Safety Code, as added by

 46-1    this Act, applies to an application for a new registration or an

 46-2    application to renew or amend an existing registration that is

 46-3    pending before the Texas Natural Resource Conservation Commission

 46-4    on or after that date.

 46-5          (c)  The payments authorized by Sections 361.477 and

 46-6    361.4771, Health and Safety Code, as amended by this Act, apply

 46-7    only to whole scrap tires shredded tire pieces, or tire-derived

 46-8    materials actually put to end use on or after September 1, 1997.

 46-9          (d)  Section 361.4825, Health and Safety Code, as added by

46-10    this Act, applies only to an offense committed on or after

46-11    September 1, 1997, if any element of the offense occurs on or after

46-12    that date.

46-13          SECTION 28.  The importance of this legislation and the

46-14    crowded condition of the calendars in both houses create an

46-15    emergency and an imperative public necessity that the

46-16    constitutional rule requiring bills to be read on three several

46-17    days in each house be suspended, and this rule is hereby suspended,

46-18    and that this Act take effect and be in force from and after its

46-19    passage, and it is so enacted.