1-1     By:  Harris                                            S.B. No. 888
 1-2           (In the Senate - Filed March 4, 1999; March 8, 1999, read
 1-3     first time and referred to Committee on Intergovernmental
 1-4     Relations; March 29, 1999, reported adversely, with favorable
 1-5     Committee Substitute by the following vote:  Yeas 5, Nays 0;
 1-6     March 29, 1999, sent to printer.)
 1-7     COMMITTEE SUBSTITUTE FOR S.B. No. 888                 By:  Moncrief
 1-8                            A BILL TO BE ENTITLED
 1-9                                   AN ACT
1-10     relating to electronic filing of records with a county clerk.
1-11           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-12           SECTION 1.  Chapter 191, Local Government Code, is amended by
1-13     adding Section 191.009 to read as follows:
1-14           Sec. 191.009.  ELECTRONIC FILING AND RECORDING.  (a)  A
1-15     county clerk may accept instruments by electronic filing and record
1-16     the instruments electronically if the filing or recording complies
1-17     with the rules adopted by the Texas State Library and Archives
1-18     Commission under Chapter 195.
1-19           (b)  An instrument that is filed electronically in compliance
1-20     with the rules adopted under Chapter 195 is considered to have been
1-21     filed in compliance with any law relating to the filing of
1-22     instruments with a county clerk.
1-23           SECTION 2.  Subtitle B, Title 6, Local Government Code, is
1-24     amended by adding Chapter 195 to read as follows:
1-25             CHAPTER 195.  ELECTRONIC FILING OF RECORDS WITH AND
1-26                          RECORDING BY COUNTY CLERK
1-27           Sec. 195.001.  DEFINITIONS.  In this chapter:
1-28                 (1)  "Commission" means the Texas State Library and
1-29     Archives Commission.
1-30                 (2)  "Director and librarian" means the executive and
1-31     administrative officer of the Texas State Library and Archives
1-32     Commission.
1-33           Sec. 195.002.  ADOPTION OF RULES.  (a)  The commission shall
1-34     adopt rules by which a county clerk may accept instruments by
1-35     electronic filing and record instruments electronically under
1-36     Section 191.009.
1-37           (b)  The rules must provide for:
1-38                 (1)  the electronic filing with and recording by the
1-39     county clerk of:
1-40                       (A)  real property records; and
1-41                       (B)  except for records maintained under Section
1-42     192.006, other instruments filed with and recorded by the county
1-43     clerk as determined by the commission;
1-44                 (2)  the means by which an instrument may be
1-45     electronically transmitted to a county clerk for filing;
1-46                 (3)  the means by which a county clerk may
1-47     electronically record an instrument filed electronically;
1-48                 (4)  requiring that the means adopted under Subdivision
1-49     (2) or (3)  be generally available, nonproprietary technology; and
1-50                 (5)  security standards to prevent the filing and
1-51     recording of fraudulent instruments or alteration of instruments
1-52     that were previously filed and recorded electronically.
1-53           (c)  Rules adopted by the commission under this section that
1-54     permit the use of digital signatures in the electronic filing of
1-55     instruments with the county clerk must be, to the extent
1-56     practicable, consistent with rules governing digital signatures
1-57     adopted by the Department of Information Resources under Section
1-58     2054.060, Government Code, as added by Chapter 528, Acts of the
1-59     75th Legislature, Regular Session, 1997.
1-60           (d)  Before adopting or amending a rule under this section,
1-61     the commission shall consider the recommendations of the Electronic
1-62     Recording Advisory Committee established under Section 195.008.
1-63           Sec. 195.003.  PERSONS AUTHORIZED TO FILE ELECTRONICALLY.
1-64     The following persons may file documents electronically  for
 2-1     recording with a county clerk that accepts electronic filing and
 2-2     recording under this chapter:
 2-3                 (1)  an attorney licensed in this state;
 2-4                 (2)  a bank, savings and loan association, savings
 2-5     bank, or credit union doing business under laws of the United
 2-6     States or this state;
 2-7                 (3)  a federally chartered lending institution, a
 2-8     federal government-sponsored entity, an instrumentality of the
 2-9     federal government, or a person approved as a mortgagee by the
2-10     United States to make federally insured loans;
2-11                 (4)  a person licensed to make regulated loans in this
2-12     state;
2-13                 (5)  a title insurance company or title insurance agent
2-14     licensed to do business in this state; or
2-15                 (6)  an agency of this state.
2-16           Sec. 195.004.  NOTICE OF CONFIRMATION.  (a)  A county clerk
2-17     that accepts electronic filing and recording under this chapter
2-18     shall confirm or reject an electronic filing of an instrument not
2-19     later than the first business day after the date an instrument is
2-20     filed.  Notice under this section must be made:
2-21                 (1)  by electronic means if possible; or
2-22                 (2)  if notice under Subdivision (1) is not possible,
2-23     by telephone or electronic facsimile machine.
2-24           (b)  If the county clerk fails to provide notice of rejection
2-25     within the time provided by Subsection (a), the instrument is
2-26     considered accepted for filing and may not subsequently be
2-27     rejected.
2-28           Sec. 195.005.  TIME INSTRUMENT CONSIDERED FILED OR RECORDED.
2-29     An instrument that is recorded electronically under this chapter is
2-30     considered to be recorded in compliance with a law relating to the
2-31     recording of instruments as of the county clerk's business day on
2-32     which the instrument is filed electronically.  An instrument filed
2-33     electronically under this chapter must be recorded as timely as an
2-34     instrument filed by any other means.
2-35           Sec. 195.006.  ADDITIONAL FEE PROHIBITED.  The fee to file or
2-36     record an instrument electronically under this chapter is the same
2-37     as the fee for filing or recording the instrument by other means,
2-38     and a county clerk may not charge an additional fee for filing or
2-39     recording an instrument electronically under this chapter.
2-40           Sec. 195.007.  ACCESS TO INSTRUMENT RECORDED ELECTRONICALLY.
2-41     (a)  An instrument filed or recorded electronically must be
2-42     available for public inspection in the same manner and at the same
2-43     time as an instrument filed or recorded by other means.
2-44           (b)  The county clerk shall provide a requestor, as defined
2-45     by Section 552.003, Government Code, of an instrument filed or
2-46     recorded electronically under this chapter with electronic copies
2-47     of the instrument in a form that is capable of being processed by
2-48     the use of technology that is generally available and
2-49     nonproprietary in nature.  The county clerk shall provide the
2-50     copies to the requestor at the cost of producing the copies in
2-51     accordance with Section 552.262, Government Code.
2-52           Sec. 195.008.  ELECTRONIC RECORDING ADVISORY COMMITTEE.  (a)
2-53     The Electronic Recording Advisory Committee shall be appointed as
2-54     required by this section to recommend to the commission initial and
2-55     subsequent rules to be adopted under this chapter.
2-56           (b)  The committee consists of:
2-57                 (1)  the following persons appointed by the director
2-58     and librarian:
2-59                       (A)  one person who is employed by or is an
2-60     officer of a title insurance agent or title insurance company;
2-61                       (B)  an officer or employee of a federal
2-62     government-sponsored entity;
2-63                       (C)  a person who as a usual business practice
2-64     obtains copies of recorded instruments from a county clerk to
2-65     maintain an abstract or title plant; and
2-66                       (D)  a public representative;
2-67                 (2)  two persons who are county judges or county
2-68     commissioners appointed by the County Judges and Commissioners
2-69     Association of Texas;
 3-1                 (3)  four county clerks appointed by the County and
 3-2     District Clerks' Association of Texas;
 3-3                 (4)  three persons who are employed by or officers of
 3-4     different title insurance agents or companies appointed by the
 3-5     Texas Land Title Association;
 3-6                 (5)  the presiding officer of the Title Insurance
 3-7     Subcommittee of the Real Estate, Probate, and Trust Law section of
 3-8     the State Bar of Texas or the functional equivalent of that
 3-9     subcommittee;
3-10                 (6)  the attorney general or a person designated by the
3-11     attorney general;
3-12                 (7)  the comptroller or a person designated by the
3-13     comptroller;
3-14                 (8)  the executive director of the General Services
3-15     Commission or a person designated by the executive director;
3-16                 (9)  the executive director of the Department of
3-17     Information Resources or a person designated by the executive
3-18     director; and
3-19                 (10)  the director and librarian or a person designated
3-20     by the director and librarian, who also serves as presiding officer
3-21     of the committee.
3-22           (c)  A member of the committee serves a term of two years
3-23     that expires on August 31 of each odd-numbered year.
3-24           (d)  A vacancy in the membership of the committee is filled
3-25     in the same manner as the initial appointment and is for the
3-26     remainder of the unexpired term.
3-27           (e)  A meeting of the committee is at the call of the
3-28     presiding officer and is subject to Chapter 551, Government Code.
3-29           (f)  A member of the committee is not entitled to
3-30     compensation or reimbursement of expenses from the commission for
3-31     serving on the committee. A member of the committee who is an
3-32     employee or officer of a state agency is entitled to compensation
3-33     and reimbursement of expenses for service on the committee as
3-34     determined by the state agency of which the member is an officer or
3-35     employee.  Chapter 2110, Government Code, does not apply to the
3-36     committee.
3-37           SECTION 3.  (a)  The entities entitled to make appointments
3-38     to the Electronic Recording Advisory Committee established under
3-39     Section 195.008, Local Government Code, as added by this Act, shall
3-40     make the appointments not later than November 1, 1999.  The terms
3-41     of the initial members of the Electronic Recording Advisory
3-42     Committee expire August 31, 2001.
3-43           (b)  The Electronic Recording Advisory Committee shall make
3-44     its recommendations for the initial adoption of rules under Chapter
3-45     195, Local Government Code, as added by this Act, not later than
3-46     September 1, 2000.
3-47           (c)  The Texas State Library and Archives Commission shall
3-48     adopt rules to implement Chapter 195, Local Government Code, as
3-49     added by this Act, not later than January 1, 2001.
3-50           (d)  Not later than December 31, 2000, the Electronic
3-51     Recording Advisory Committee shall make written recommendations on
3-52     statutory changes necessary to allow for digital signatures on real
3-53     estate transactions and the electronic filing and recording of
3-54     instruments executed by digital signature.  The committee shall
3-55     send the recommendations to the lieutenant governor, the speaker of
3-56     the house of representatives, and the Texas State Library and
3-57     Archives Commission.
3-58           SECTION 4.  The importance of this legislation and the
3-59     crowded condition of the calendars in both houses create an
3-60     emergency and an imperative public necessity that the
3-61     constitutional rule requiring bills to be read on three several
3-62     days in each house be suspended, and this rule is hereby suspended,
3-63     and that this Act take effect and be in force from and after its
3-64     passage, and it is so enacted.
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