By Harris                                              S.B. No. 310
         77R1055 SMH-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the continuation and functions of the Railroad
 1-3     Commission of Texas.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1. Articles 6445a, 6447b, 6447c, and 6447h, Revised
 1-6     Statutes, are amended to read as follows:
 1-7           Art. 6445a.  SUNSET PROVISION. The Railroad Commission of
 1-8     Texas is subject to Chapter 325, Government Code (Texas Sunset
 1-9     Act).  Unless continued in existence as provided by that chapter,
1-10     the commission is abolished September 1, 2013 [2001].
1-11           Art. 6447b.  EQUAL EMPLOYMENT OPPORTUNITY [EMPLOYEE
1-12     PERFORMANCE]. (a)  The commission [or its designee shall develop an
1-13     intra-agency career ladder program, one part of which shall be the
1-14     intra-agency posting of all nonentry level positions for at least
1-15     10 days before any public posting.]
1-16           [(b)  The commission or its designee shall develop a system
1-17     of annual performance evaluations based on measurable job tasks.
1-18     All merit pay for commission employees must be based on the system
1-19     established under this subsection.]
1-20           [(c)  The commission] shall prepare and maintain a written
1-21     policy statement that implements [plan to assure implementation of]
1-22     a program of equal employment opportunity to ensure that [whereby]
1-23     all personnel decisions [transactions] are made without regard to
1-24     race, color, disability, sex, religion, age, or national origin.
 2-1           (b)  The policy statement must [plan shall] include:
 2-2                 (1)  personnel policies, including policies relating to
 2-3     [plans for] recruitment, evaluation, selection, [appointment,]
 2-4     training, and promotion of personnel, that show the intent of the
 2-5     commission to avoid the unlawful employment practices described by
 2-6     Chapter 21, Labor Code; and
 2-7                 (2)  an analysis of the extent to which the composition
 2-8     of the commission's personnel is in accordance with state and
 2-9     federal law and a description of reasonable methods to achieve
2-10     compliance with state and federal law.
2-11           (c)  The policy statement must:
2-12                 (1)  be updated annually;
2-13                 (2)  be reviewed by the state Commission on Human
2-14     Rights for compliance with Subsection (b) of this article; and
2-15                 (3)  be filed with the governor's office[, and other
2-16     personnel practices.  The plan shall also include steps reasonably
2-17     designed to overcome any identified under-utilization of minorities
2-18     and women in the commission's work force and shall include
2-19     objectives and goals, timetables for achieving those objectives and
2-20     goals, and assignments of responsibility for their completion.  The
2-21     plan shall be filed with the governor's office within 60 days after
2-22     the effective date of this section, cover an annual period, and be
2-23     updated at least annually.  Progress reports shall be submitted to
2-24     the governor's office within 30 days of November 1 and April 1 of
2-25     each year and shall include the steps the commission has taken
2-26     within the reporting period to comply with this requirement of this
2-27     section].
 3-1           Art. 6447c.  CONFLICT OF INTEREST. (a)  In this section,
 3-2     "Texas trade association" means a cooperative and voluntarily
 3-3     joined association of business or professional competitors in this
 3-4     state designed to assist its members and its industry or profession
 3-5     in dealing with mutual business or professional problems and in
 3-6     promoting their common interest.
 3-7           (b)  A person may not be an employee of the commission
 3-8     employed in a "bona fide executive, administrative, or professional
 3-9     capacity," as that phrase is used for purposes of establishing an
3-10     exemption to the overtime provisions of the federal Fair Labor
3-11     Standards Act of 1938 (29 U.S.C. Section 201 et seq.) and its
3-12     subsequent amendments, if:
3-13                 (1)  the person is an officer, employee, or paid
3-14     consultant of a Texas trade association in a business or industry
3-15     regulated by the commission; or
3-16                 (2)  the person's spouse is an officer, manager, or
3-17     paid consultant of a Texas [An employee of the commission may not
3-18     be an officer, employee, or paid consultant of a] trade association
3-19     in a business or industry regulated by the commission.
3-20           (c) [(b)]  A person who is required to register as a lobbyist
3-21     under Chapter 305, Government Code, may not act as the general
3-22     counsel to the commission.
3-23           (d) [(c)]  The commission[, as often as necessary,] shall
3-24     provide to members of the commission and to agency employees, as
3-25     often as necessary, information regarding the requirements for
3-26     office or employment under this chapter, including information
3-27     regarding a person's [employees'] responsibilities under applicable
 4-1     laws relating to standards of conduct for state officers or
 4-2     employees.
 4-3           Art. 6447h.  COMPLAINTS. (a)  The commission shall maintain a
 4-4     [keep an information] file on [about] each written complaint filed
 4-5     with the commission.  The file must include:
 4-6                 (1)  the name of the person who filed the complaint;
 4-7                 (2)  the date the complaint is received by the
 4-8     commission;
 4-9                 (3)  the subject matter of the complaint;
4-10                 (4)  the name of each person contacted in relation to
4-11     the complaint;
4-12                 (5)  a summary of the results of the review or
4-13     investigation of the complaint; and
4-14                 (6)  an explanation of the reason the file was closed,
4-15     if the agency closed the file without taking action other than to
4-16     investigate the complaint.
4-17           (b)  The commission shall provide to the person filing the
4-18     complaint and to each person who is a subject of the complaint a
4-19     copy of the commission's policies and procedures relating to
4-20     complaint investigation and resolution.
4-21           (c)  The [relating to a person who has a license, permit, or
4-22     certificate of public convenience and necessity from the
4-23     commission.]
4-24           [(b)  If a written complaint is filed with the commission
4-25     relating to a person who has a license, permit, or certificate of
4-26     public convenience and necessity from the] commission, at least [as
4-27     frequently as] quarterly [and] until final disposition of the
 5-1     complaint, [the commission] shall notify the person filing [parties
 5-2     to] the complaint and each person who is a subject of the complaint
 5-3     of the status of the investigation [complaint] unless the notice
 5-4     would jeopardize an undercover investigation.  [This section does
 5-5     not apply to complaints under Chapter 91, Natural Resources Code.]
 5-6           SECTION 2. Title 112, Revised Statutes, is amended by adding
 5-7     Articles 6447k, 6447l, and 6447m to read as follows:
 5-8           Art. 6447k.  SEPARATION OF POLICYMAKING AND MANAGEMENT
 5-9     RESPONSIBILITIES. The commission shall develop and implement
5-10     policies that clearly separate the policymaking responsibilities of
5-11     the members of the commission and the management responsibilities
5-12     of the staff of the commission.
5-13           Art. 6447l.  PUBLIC PARTICIPATION. The commission shall
5-14     develop and implement policies that provide the public with a
5-15     reasonable opportunity to appear before the commission and to speak
5-16     on any issue under the jurisdiction of the commission.
5-17           Art. 6447m.  EMPLOYEE INCENTIVE PROGRAM. The commission shall
5-18     provide to agency employees information and training on the
5-19     benefits and methods of participation in the State Employee
5-20     Incentive Program.
5-21           SECTION 3. Section 81.0531, Natural Resources Code, is
5-22     amended by amending Subsections (c) and (d) and adding Subsection
5-23     (e) to read as follows:
5-24           (c)  In determining the amount of the penalty, the commission
5-25     shall consider the permittee's history of previous violations, the
5-26     seriousness of the violation, any hazard to the health or safety of
5-27     the public, and the demonstrated good faith of the person charged.
 6-1     In determining the amount of the penalty for a violation of a
 6-2     provision of this title or a rule, order, license, permit, or
 6-3     certificate that relates to pipeline safety, the commission shall
 6-4     consider the guidelines adopted under Subsection (d).
 6-5           (d)  The commission by rule shall adopt guidelines to be used
 6-6     in determining the amount of the penalty for a violation of a
 6-7     provision of this title or a rule, order, license, permit, or
 6-8     certificate that relates to pipeline safety.  The guidelines shall
 6-9     include a penalty calculation worksheet that specifies the typical
6-10     penalty for certain violations, circumstances justifying
6-11     enhancement of a penalty and the amount of the enhancement, and
6-12     circumstances justifying a reduction in a penalty and the amount of
6-13     the reduction.  The guidelines shall take into account:
6-14                 (1)  the permittee's history of previous violations,
6-15     including the number of previous violations;
6-16                 (2)  the seriousness of the violation and of any
6-17     pollution resulting from the violation;
6-18                 (3)  any hazard to the health or safety of the public;
6-19                 (4)  the degree of culpability;
6-20                 (5)  the demonstrated good faith of the person charged;
6-21     and
6-22                 (6)  any other factor the commission considers
6-23     relevant.
6-24           (e)  A penalty collected under this section shall be
6-25     deposited to the credit of the oil-field cleanup fund.
6-26           SECTION 4. Section 81.116(a), Natural Resources Code, is
6-27     amended to read as follows:
 7-1           (a)  An oil-field cleanup regulatory fee is imposed on crude
 7-2     petroleum produced in this state in an [the] amount set by
 7-3     commission rule not to exceed [of five-sixteenths of] one cent on
 7-4     each barrel of 42 standard gallons.
 7-5           SECTION 5. Section 81.117(a), Natural Resources Code, is
 7-6     amended to read as follows:
 7-7           (a)  An oil-field cleanup regulatory fee is imposed on gas
 7-8     initially produced and saved in this state in an [the] amount set
 7-9     by commission rule not to exceed one-tenth of [one-thirtieth of]
7-10     one cent for each thousand cubic feet.
7-11           SECTION 6. Section 85.2021, Natural Resources Code, is
7-12     amended by amending Subsections (c) and (d) and adding Subsection
7-13     (e) to read as follows:
7-14           (c)  With each application for an extension of time to plug a
7-15     well pursuant to commission rules, an applicant shall submit to the
7-16     commission a nonrefundable fee of $300 [$100], unless the applicant
7-17     has filed a bond under Section 91.1041 or Section 91.1042 of this
7-18     code.  This subsection expires September 1, 2004.
7-19           (d)  Notwithstanding Subsections (a) and (b), the commission
7-20     by rule shall set fees under those subsections in amounts that are
7-21     projected to generate in the aggregate annual revenue of $1.5
7-22     million more than the aggregate annual revenue projected to be
7-23     generated by the fee amounts provided by those subsections.
7-24           (e)  All fees collected under this section shall be deposited
7-25     in the state oil-field cleanup fund.
7-26           SECTION 7. Effective September 1, 2004, Section 91.103,
7-27     Natural Resources Code, is amended to read as follows:
 8-1           Sec. 91.103.  PERSONS REQUIRED TO EXECUTE BOND [OR ALTERNATE
 8-2     FORM OF FINANCIAL SECURITY]. Any person, including any firm,
 8-3     partnership, joint stock association, corporation, or other
 8-4     organization, required to file an organization report under Section
 8-5     91.142 of this code shall execute and file with the commission a
 8-6     bond [or alternate form of financial security].
 8-7           SECTION 8. Sections 91.104(b) and (c), Natural Resources
 8-8     Code, are amended to read as follows:
 8-9           (b)  A person required to file a bond under Section 91.103
8-10     may choose to file:
8-11                 (1)  an individual bond as provided under Section
8-12     91.1041;
8-13                 (2)  a blanket bond as provided under Section 91.1042;
8-14     or
8-15                 (3)  [a nonrefundable annual fee of $100, if the person
8-16     can demonstrate to the commission an acceptable record of
8-17     compliance with all commission rules, orders, licenses, permits, or
8-18     certificates that relate to safety or the prevention or control of
8-19     pollution for the previous 48 months and the person and, if a firm,
8-20     partnership, joint stock association, corporation, or other
8-21     organization, its officers, directors, general partners, or owners
8-22     of more than 25 percent ownership interest or any trustee:]
8-23                       [(A)  has no outstanding violations of such
8-24     commission rules, orders, licenses, permits, or certificates;]
8-25                       [(B)  has paid all administrative, civil, and
8-26     criminal penalties, if any, relating to any violation of such
8-27     commission rules, orders, licenses, permits, or certificates; and]
 9-1                       [(C)  has paid all reimbursements of any costs
 9-2     and expenses incurred by the commission in relation to any
 9-3     violation of such commission rules, orders, licenses, permits, or
 9-4     certificates;]
 9-5                 [(4)]  a nonrefundable annual fee equal to three
 9-6     percent of the bond that otherwise would be required[; or]
 9-7                 [(5)  to give a first lien on tangible personal
 9-8     property associated with oil and gas production whose salvage value
 9-9     equals the value of an individual bond under Section 91.1041 or the
9-10     value of a blanket bond under Section 91.1042 that otherwise would
9-11     be required].
9-12           (c)  A person who chooses to file a form of financial
9-13     security other than a bond shall also submit a fee [of $100] for
9-14     each application to extend the time to plug a well in accordance
9-15     with Section 85.2021 of this code.
9-16           SECTION 9. Effective September 1, 2004, Section 91.104,
9-17     Natural Resources Code, is amended to read as follows:
9-18           Sec. 91.104.  BONDS [AND ALTERNATE FORMS OF FINANCIAL
9-19     SECURITY]. (a)  The commission shall require a bond [or an
9-20     alternate form of financial security] to be filed with the
9-21     commission as provided by Subsection (b) of this section.
9-22           (b)  A person required to file a bond under Section 91.103
9-23     may choose to file:
9-24                 (1)  an individual bond as provided under Section
9-25     91.1041; or
9-26                 (2)  a blanket bond as provided under Section 91.1042[;]
9-27                 [(3)  a nonrefundable annual fee of $100, if the person
 10-1    can demonstrate to the commission an acceptable record of
 10-2    compliance with all commission rules, orders, licenses, permits, or
 10-3    certificates that relate to safety or the prevention or control of
 10-4    pollution for the previous 48 months and the person and, if a firm,
 10-5    partnership, joint stock association, corporation, or other
 10-6    organization, its officers, directors, general partners, or owners
 10-7    of more than 25 percent ownership interest or any trustee:]
 10-8                      [(A)  has no outstanding violations of such
 10-9    commission rules, orders, licenses, permits, or certificates;]
10-10                      [(B)  has paid all administrative, civil, and
10-11    criminal penalties, if any, relating to any violation of such
10-12    commission rules, orders, licenses, permits, or certificates; and]
10-13                      [(C)  has paid all reimbursements of any costs
10-14    and expenses incurred by the commission in relation to any
10-15    violation of such commission rules, orders, licenses, permits, or
10-16    certificates;]
10-17                [(4)  a nonrefundable annual fee equal to three percent
10-18    of the bond that otherwise would be required; or]
10-19                [(5)  to give a first lien on tangible personal
10-20    property associated with oil and gas production whose salvage value
10-21    equals the value of an individual bond under Section 91.1041 or the
10-22    value of a blanket bond under Section 91.1042 that otherwise would
10-23    be required].
10-24          [(c)  A person who chooses to file a form of financial
10-25    security other than a bond shall also submit a fee of $100 for each
10-26    application to extend the time to plug a well in accordance with
10-27    Section 85.2021 of this code.]
 11-1          SECTION 10. Sections 91.1041 and 91.1042, Natural Resources
 11-2    Code, are amended to read as follows:
 11-3          Sec. 91.1041.  INDIVIDUAL BOND. (a)  A person required to
 11-4    file a bond under Section 91.103 who operates one or more wells may
 11-5    file a bond in an amount equal to $2 for each foot of well depth
 11-6    for each well.
 11-7          (b)  Notwithstanding Subsection (a), the commission by rule
 11-8    shall set the amount of the bond for an operator of one or more bay
 11-9    or offshore wells at a reasonable amount that exceeds the amount
11-10    provided by Subsection (a).
11-11          Sec. 91.1042.  BLANKET BOND. (a)  A person required to file a
11-12    bond under Section 91.103 may file a blanket bond to cover all
11-13    wells and operations for which a bond is required as follows:
11-14                (1)  a person who operates 10 or fewer wells or
11-15    performs other operations shall file a $25,000 blanket bond;
11-16                (2)  a person who operates more than 10 but fewer than
11-17    100 wells shall file a $50,000 blanket bond; and
11-18                (3)  a person who operates 100 or more wells shall file
11-19    a $250,000 blanket bond.
11-20          (b)  Notwithstanding Subsection (a), the commission by rule
11-21    shall set the amount of the bond for an operator of bay or offshore
11-22    wells at a reasonable amount that exceeds the amount provided by
11-23    Subsection (a)(1), (2), or (3), as applicable.
11-24          SECTION 11. Effective September 1, 2004, Section 91.107,
11-25    Natural Resources Code, is amended to read as follows:
11-26          Sec. 91.107.  NEW BOND [OR ALTERNATE FORM OF FINANCIAL
11-27    SECURITY]. If a well covered by a bond [or alternate form of
 12-1    financial security] is transferred, sold, or assigned by its
 12-2    operator, the commission shall require the party acquiring the well
 12-3    to file a new bond [or alternate form of financial security] as
 12-4    provided by this subchapter, and the bond [or alternate form of
 12-5    financial security] of the prior operator shall continue to be
 12-6    required and to remain in effect until the new bond [or alternate
 12-7    form of financial security] is provided or the commission
 12-8    determines that the bond [financial security] previously submitted
 12-9    to the commission by the person acquiring the well complies with
12-10    this subchapter.
12-11          SECTION 12. Section 91.111, Natural Resources Code, is
12-12    amended by amending Subsections (b) and (c) and adding Subsection
12-13    (e) to read as follows:
12-14          (b)  The commission shall certify to the comptroller the date
12-15    on which the balance in the fund equals or exceeds $20 [$10]
12-16    million.  The oil-field cleanup regulatory fees on oil and gas
12-17    shall not be collected or required to be paid on or after the first
12-18    day of the second month following the certification, except that
12-19    the comptroller shall resume collecting the fees on receipt of a
12-20    commission certification that the fund has fallen below $10 [$6]
12-21    million.  The comptroller shall continue collecting the fees until
12-22    collections are again suspended in the manner provided by this
12-23    subsection.
12-24          (c)  The fund consists of:
12-25                (1)  penalties imposed under Section 85.381 for
12-26    violation of a law, order, or rule relating to well plugging
12-27    requirements;
 13-1                (2)  proceeds from bonds and other financial assurances
 13-2    required by this chapter, subject to the refund provisions of
 13-3    Section 91.1091;
 13-4                (3)  private contributions, including contributions
 13-5    made under Section 89.084;
 13-6                (4)  expenses collected under Section 89.083;
 13-7                (5)  fees imposed under Section 85.2021;
 13-8                (6)  civil penalties collected for violations of
 13-9    Chapter 89 or of rules or orders relating to plugging that are
13-10    adopted under this code;
13-11                (7)  proceeds collected under Sections 89.085 and
13-12    91.115;
13-13                (8)  interest earned on the funds deposited in the
13-14    fund;
13-15                (9)  fees collected under Section 91.104;
13-16                (10)  civil penalties or costs recovered under Section
13-17    91.457 or 91.459;
13-18                (11)  oil and gas waste hauler permit application fees
13-19    collected under Section 29.015, Water Code;
13-20                (12)  costs recovered under Section 91.113(f);
13-21                (13)  hazardous oil and gas waste generation fees
13-22    collected under Section 91.605;
13-23                (14)  oil-field cleanup regulatory fees on oil
13-24    collected under Section 81.116;
13-25                (15)  oil-field cleanup regulatory fees on gas
13-26    collected under Section 81.117;
13-27                (16)  fees for a reissued certificate collected under
 14-1    Section 85.167;
 14-2                (17)  fees collected under Section 91.1013;
 14-3                (18)  fees collected under Section 89.088;
 14-4                (19)  penalties collected under Section 81.0531; [and]
 14-5                (20)  fees collected under Section 91.142;
 14-6                (21)  fees collected under Section 91.1132; and
 14-7                (22)  legislative appropriations.
 14-8          (e)  The commission, through the legislative appropriations
 14-9    request process, shall establish specific performance goals for the
14-10    oil-field cleanup fund for the next biennium, including goals for
14-11    the number of:
14-12                (1)  site investigations and environmental assessments
14-13    to be conducted;
14-14                (2)  abandoned wells to be plugged; and
14-15                (3)  surface locations to be remediated.
14-16          SECTION 13. Section 91.112(b), Natural Resources Code, is
14-17    amended to read as follows:
14-18          (b)  The commission shall submit to the legislature and make
14-19    available to the public, annually, a report that reviews the extent
14-20    to which money provided under Section 91.111 has enabled the
14-21    commission to better protect the environment and enhance the income
14-22    of the oil-field cleanup fund. The report shall include:
14-23                (1)  the number of wells plugged, by region;
14-24                (2)  the number of wells abandoned, by region;
14-25                (3)  the number of inactive wells not currently in
14-26    compliance with commission rules, by region;
14-27                (4)  the status of enforcement proceedings for all
 15-1    wells in violation of commission rules and the time period during
 15-2    which the wells have been in violation, by region in which the
 15-3    wells are located;
 15-4                (5)  the number of surface locations remediated, by
 15-5    region;
 15-6                (6)  a detailed accounting of expenditures of money in
 15-7    the fund, including expenditures for site investigations and
 15-8    environmental assessments, plugging of abandoned wells, remediation
 15-9    of surface locations, and staff salaries and other administrative
15-10    expenses;
15-11                (7)  the method by which the commission sets priorities
15-12    by which it determines the order in which abandoned wells are
15-13    plugged;
15-14                (8) [(6)]  a projection of the amount of money needed
15-15    for the next biennium for conducting site investigations and
15-16    environmental assessments, plugging abandoned wells, and
15-17    remediating surface locations; and
15-18                (9) [(7)]  the status of implementation of the
15-19    provisions of Section 89.085 relating to possession and sale of
15-20    equipment to recover plugging costs.
15-21          SECTION 14. Subchapter D, Chapter 91, Natural Resources Code,
15-22    is amended by adding Sections 91.1131 and 91.1132 to read as
15-23    follows:
15-24          Sec. 91.1131.  RISK ASSESSMENT STANDARDS; PRIORITIZATION OF
15-25    HIGH-RISK WELLS. (a)  The commission by rule shall establish risk
15-26    assessment as the guide for:
15-27                (1)  conducting site investigations and environmental
 16-1    assessments; and
 16-2                (2)  controlling and cleaning up oil and gas wastes and
 16-3    other substances and materials.
 16-4          (b)  Rules adopted under this section must provide for:
 16-5                (1)  determining whether an actual or potential risk
 16-6    exists at a site;
 16-7                (2)  screening contaminants at the site to identify
 16-8    those that pose a risk;
 16-9                (3)  developing cleanup standards based on
16-10    contamination levels that are protective of human health and the
16-11    environment and that preserve the active and productive use of the
16-12    land; and
16-13                (4)  establishing a reporting mechanism for informing
16-14    the commission regarding specific remediation activities.
16-15          (c)  The commission by rule shall develop a system for:
16-16                (1)  identifying abandoned wells that pose a high risk
16-17    of contaminating surface water or groundwater;
16-18                (2)  periodically testing high-risk wells by conducting
16-19    a fluid level test or, if necessary, a pressure test; and
16-20                (3)  giving priority to plugging high-risk wells with
16-21    compromised casings.
16-22          Sec. 91.1132.  VOLUNTARY CLEANUP PROGRAM. (a)  The commission
16-23    by rule shall establish a voluntary cleanup program under which a
16-24    person who is not a responsible person as defined by Section 91.113
16-25    and who cleans up oil and gas wastes or other substances or
16-26    materials in accordance with an agreement with the commission may
16-27    receive from the commission a certificate evidencing completion of
 17-1    the cleanup.  On receipt of the certificate, the person is released
 17-2    from all liability to the commission for cleanup of the site
 17-3    covered by the certificate.
 17-4          (b)  A person who desires to participate in the program must
 17-5    submit to the commission:
 17-6                (1)  an application; and
 17-7                (2)  an application fee in an amount set by commission
 17-8    rule.
 17-9          (c)  The staff of the commission shall:
17-10                (1)  assist a participant in the program in developing
17-11    a cleanup plan; and
17-12                (2)  provide technical oversight during the cleanup.
17-13          (d)  The program established under this section must be
17-14    consistent with rules adopted under Section 91.1131.
17-15          SECTION 15. Section 91.142, Natural Resources Code, is
17-16    amended by adding Subsection (g) to read as follows:
17-17          (g)  The commission by rule shall require an organization
17-18    report filed under this section to be accompanied by a fee set by
17-19    the commission in an amount sufficient to cover the cost of
17-20    administering this section.  The commission may not set a fee under
17-21    this subsection in an amount that is projected to generate annual
17-22    revenue of more than $3 million.
17-23          SECTION 16. Subchapter B, Chapter 101, Natural Resources
17-24    Code, is amended by adding Section 101.019 to read as follows:
17-25          Sec. 101.019.  MANDATORY UNITIZATION. (a)  Notwithstanding
17-26    the other provisions of this chapter, the commission shall adopt
17-27    rules authorizing mandatory unitization.
 18-1          (b)  The rules shall authorize a working interest owner to
 18-2    file an application with the commission on a form prescribed by the
 18-3    commission for approval of a waterflood, enhanced oil recovery
 18-4    project, or tertiary recovery project affecting all or part of an
 18-5    oil field, gas field, or oil and gas field.
 18-6          (c)  The commission may approve the application if, after
 18-7    notice and hearing, the commission determines that the waterflood,
 18-8    enhanced oil recovery project, or tertiary recovery project:
 18-9                (1)  is equitable and reasonable;
18-10                (2)  prevents waste;
18-11                (3)  promotes conservation of natural resources; and
18-12                (4)  protects the correlative rights of the owners of
18-13    all the interests in the field.
18-14          (d)  If the commission approves the application, the owners
18-15    of all the interests in the area covered by the application are
18-16    bound by the terms of the proposed waterflood, enhanced oil
18-17    recovery project, or tertiary recovery project.
18-18          (e)  In adopting rules under this section, the commission
18-19    shall take into consideration those procedures used by agencies or
18-20    commissions of other states having similar authority over the
18-21    regulation of oil and gas matters.
18-22          SECTION 17. Section 113.0511, Natural Resources Code, is
18-23    amended to read as follows:
18-24          Sec. 113.0511.  LIMITATIONS ON RULEMAKING AUTHORITY. (a)  The
18-25    commission may not adopt rules restricting advertising or
18-26    competitive bidding [or advertising] by a licensee [person
18-27    regulated by the commission] except to prohibit false, misleading,
 19-1    or deceptive practices [by the person].
 19-2          (b)  In its [The commission may not include in any] rules to
 19-3    prohibit false, misleading, or deceptive practices, the commission
 19-4    may not include [by a person regulated by the commission] a rule
 19-5    that:
 19-6                (1)  restricts the [person's] use of any medium for
 19-7    advertising;
 19-8                (2)  restricts the use of a licensee's [person's]
 19-9    personal appearance or [use of his] voice in an advertisement;
19-10                (3)  relates to the size or duration of an
19-11    advertisement by the licensee [person]; or
19-12                (4)  restricts the licensee's [person's] advertisement
19-13    under a trade name.
19-14          SECTION 18. Section 113.087, Natural Resources Code, is
19-15    amended by amending Subsections (i)-(m) and adding Subsections (n)
19-16    and (o) to read as follows:
19-17          (i)  Not later than the 30th day after the date a person
19-18    takes a licensing [on which an] examination [is administered] under
19-19    this chapter [section], the commission shall notify the person
19-20    [each examinee] of the results of the examination.
19-21          (j)  If the examination is graded or reviewed by a testing
19-22    service:
19-23                (1)  the commission shall notify the person of the
19-24    results of the examination not later than the 14th day after the
19-25    date the commission receives the results from the testing service;
19-26    and
19-27                (2)  if notice of the examination results will be
 20-1    delayed for longer than 90 days after the examination date, the
 20-2    commission shall notify the person [examinee] of the reason for the
 20-3    delay before the 90th day.
 20-4          (k)  The commission may require a testing service to notify a
 20-5    person of the results of the person's examination.
 20-6          (l) [(j)]  If requested in writing by a person who fails a
 20-7    [the] licensing examination administered under this chapter
 20-8    [section], the commission shall furnish the person with an analysis
 20-9    of the person's performance on the examination.
20-10          (m) [(k)]  The commission, by appropriate rule, shall [may]
20-11    require, in addition to examination requirements as set out in
20-12    Subsections (b), (c), and (d) of this section:
20-13                (1)  an examination for technical competence that is
20-14    validated by a recognized educational testing organization or
20-15    similar organization; or
20-16                (2)  attendance at approved academic, trade,
20-17    professional, or commission-sponsored seminars, other continuing
20-18    education programs, and periodic reexaminations.
20-19          (n) [(l)]  Prior to qualifying an individual to perform
20-20    LP-gas work, the commission may establish by rule an initial course
20-21    of instruction for any person who has not yet passed the category
20-22    of examination for which the person seeks qualification;  for any
20-23    person who has not maintained qualified status, as defined by rule;
20-24    and for any person whose certification has been revoked pursuant to
20-25    Subchapter F of this code.  If an initial course of instruction is
20-26    established by the commission, it shall be available at least once
20-27    every 90 days.
 21-1          (o) [(m)]  The commission by rule may exempt from any
 21-2    provision of this section:
 21-3                (1)  a journeyman or master plumber licensed by the
 21-4    Texas State Board of Plumbing Examiners;
 21-5                (2)  a person licensed under the Air Conditioning and
 21-6    Refrigeration Contractor License Law (Article 8861, Vernon's Texas
 21-7    Civil Statutes); or
 21-8                (3)  company representatives, operations supervisors,
 21-9    or employees of a testing laboratory that was registered under
21-10    Section 113.135 prior to the effective date of this subsection.
21-11          SECTION 19. Section 113.093, Natural Resources Code, is
21-12    amended to read as follows:
21-13          Sec. 113.093.  LICENSE RENEWAL. (a)  A person who is
21-14    otherwise eligible to renew a license may renew an unexpired
21-15    license by paying the required [issued pursuant to this chapter is
21-16    renewable on the timely payment or tender of the] renewal [license]
21-17    fee to the commission before the expiration date of the license
21-18    [each year].  A person whose license has expired may not engage in
21-19    activities that require a license until the license has been
21-20    renewed.
21-21          (b)  A person whose [If a person's] license has been expired
21-22    for [not longer than] 90 days or less [, the person] may renew the
21-23    license by paying to the commission a [the required] renewal fee
21-24    that is equal to 1-1/2 times the normally required [and a fee that
21-25    is one-half of the amount of the] renewal fee [for the license].
21-26          (c)  A person whose [If a person's] license has been expired
21-27    for more [longer] than 90 days but less than one year [two years,
 22-1    the person] may renew the license by paying to the commission a
 22-2    [all unpaid] renewal [fees and a] fee that is equal to two times
 22-3    the normally required [the amount of the unpaid] renewal fee [fees
 22-4    for the license].
 22-5          (d)  A person whose [If a person's] license has been expired
 22-6    for one year [two years] or more [longer, the person] may not renew
 22-7    the license.  The person may obtain a new license by complying with
 22-8    the requirements and procedures, including the examination
 22-9    requirements, for obtaining an original license.
22-10          (e)  A person who was licensed in this state, moved to
22-11    another state, and is currently licensed and has been in practice
22-12    in the other state for the two years preceding the date of
22-13    application may obtain a new license without reexamination.  The
22-14    person must pay to the commission a fee that is equal to two times
22-15    the normally required renewal fee for the license.
22-16          (f)  Not later than the 30th day before the date a person's
22-17    license is scheduled to expire, the commission shall send written
22-18    notice of the impending expiration to the person at the person's
22-19    last known address according to the records of the commission.
22-20          (g)  A renewal license will be issued to a licensee as soon
22-21    as is practicable after compliance with this section, and
22-22    fulfillment of insurance, examination, and seminar requirements
22-23    established by this chapter, and submission of any information and
22-24    data the commission may reasonably require.
22-25          (h) [(f)]  Renewal [license] fees shall be nonrefundable.
22-26          [(g)  At least 15 days before the expiration of a person's
22-27    license the commission shall notify the person in writing of the
 23-1    impending license expiration and shall attempt to obtain from the
 23-2    person a signed receipt confirming receipt of the notice.]
 23-3          SECTION 20. Subchapter D, Chapter 113, Natural Resources
 23-4    Code, is amended by adding Section 113.096 to read as follows:
 23-5          Sec. 113.096.  PROVISIONAL LICENSE. (a)  The commission may
 23-6    issue a provisional license to an applicant currently licensed in
 23-7    another jurisdiction who seeks a license in this state and who:
 23-8                (1)  has been licensed in good standing for at least
 23-9    two years in another jurisdiction, including a foreign country,
23-10    that has licensing requirements substantially equivalent to the
23-11    requirements of this chapter;
23-12                (2)  has passed a national or other examination
23-13    recognized by the commission relating to the activities regulated
23-14    under this chapter; and
23-15                (3)  is sponsored by a person licensed by the
23-16    commission under this chapter with whom the provisional license
23-17    holder will practice during the time the person holds a provisional
23-18    license.
23-19          (b)  The commission may waive the requirement of Subsection
23-20    (a)(3) for an applicant if the commission determines that
23-21    compliance with that subsection would be a hardship to the
23-22    applicant.
23-23          (c)  A provisional license is valid until the date the
23-24    commission approves or denies the provisional license holder's
23-25    application for a license.  The commission shall issue a license
23-26    under this chapter to the provisional license holder if:
23-27                (1)  the provisional license holder is eligible to be
 24-1    licensed under Section 113.095; or
 24-2                (2)  the provisional license holder:
 24-3                      (A)  passes the part of the examination under
 24-4    Section 113.087 that relates to the applicant's knowledge and
 24-5    understanding of the laws and rules relating to the activities
 24-6    regulated under this chapter in this state;
 24-7                      (B)  meets the academic and experience
 24-8    requirements for a license under this chapter; and
 24-9                      (C)  satisfies any other licensing requirements
24-10    under this chapter.
24-11          (d)  The commission must approve or deny a provisional
24-12    license holder's application for a license not later than the 180th
24-13    day after the date the provisional license is issued.  The
24-14    commission may extend the 180-day period if the results of an
24-15    examination have not been received by the commission before the end
24-16    of that period.
24-17          (e)  The commission may establish a fee for provisional
24-18    licenses in an amount reasonable and necessary to cover the cost of
24-19    issuing the license.
24-20          SECTION 21. The heading to Subchapter F, Chapter 113, Natural
24-21    Resources Code, is amended to read as follows:
24-22     SUBCHAPTER F.  DISCIPLINARY ACTION [SUSPENSION AND REVOCATION OF
24-23                        LICENSES AND REGISTRATIONS]
24-24          SECTION 22. Section 113.163, Natural Resources Code, is
24-25    amended to read as follows:
24-26          Sec. 113.163.  FINDINGS AND JUDGMENT. (a)  The [If the]
24-27    commission shall revoke, suspend, or refuse to renew a license or
 25-1    registration or shall reprimand a licensee or registrant if the
 25-2    commission finds that the licensee or registrant has violated or
 25-3    failed to comply with or is violating or failing to comply with
 25-4    this chapter or a rule or standard promulgated and adopted under
 25-5    this chapter[, or both, the commission may suspend the license or
 25-6    registration for a definite period not to exceed 90 days or may
 25-7    revoke the license or registration.  If the commission determines
 25-8    that no violation has occurred or is occurring, its order shall so
 25-9    state.  Whenever a license or registration is revoked by order of
25-10    the commission, a new license or registration shall not be issued
25-11    for at least 90 days from the effective date of the order.  Such
25-12    time period shall be stated in the order].
25-13          (b)  The commission may place on probation a person whose
25-14    license or registration is [has been] suspended.  If a license or
25-15    registration suspension is probated, the commission may require the
25-16    person:
25-17                (1)  to report regularly to the commission on matters
25-18    that are the basis of the probation;
25-19                (2)  to limit practice to the areas prescribed by the
25-20    commission; or
25-21                (3)  to continue or review professional education until
25-22    the person attains a degree of skill satisfactory to the commission
25-23    in those areas that are the basis of the [under Subsection (a)  of
25-24    this section for a definite period not to exceed one year, but if
25-25    the commission does place the licensee or registrant on probation
25-26    and does allow him to continue to operate, the fact that the
25-27    license or registration has been suspended and the licensee or
 26-1    registrant has been put on probation shall appear in the records of
 26-2    the commission relating to the suspension and] probation.
 26-3          SECTION 23. Subchapter B, Chapter 116, Natural Resources
 26-4    Code, is amended by adding Section 116.016 to read as follows:
 26-5          Sec. 116.016.  LIMITATIONS ON RULEMAKING AUTHORITY. (a)  The
 26-6    commission may not adopt rules restricting advertising or
 26-7    competitive bidding by a licensee or registrant except to prohibit
 26-8    false, misleading, or deceptive practices.
 26-9          (b)  In its rules to prohibit false, misleading, or deceptive
26-10    practices, the commission may not include a rule that:
26-11                (1)  restricts the use of any medium for advertising;
26-12                (2)  restricts the use of a licensee or registrant's
26-13    personal appearance or voice in an advertisement;
26-14                (3)  relates to the size or duration of an
26-15    advertisement by the licensee or registrant; or
26-16                (4)  restricts the licensee or registrant's
26-17    advertisement under a trade name.
26-18          SECTION 24. Section 116.033, Natural Resources Code, is
26-19    amended to read as follows:
26-20          Sec. 116.033.  APPLICATION AND RENEWAL PROCEDURES. (a)  The
26-21    commission shall adopt rules establishing procedures for submitting
26-22    and processing applications for issuance and renewal of licenses
26-23    and for registration.
26-24          (b)  A person who is otherwise eligible to renew a license or
26-25    registration may renew an unexpired license or registration by
26-26    paying the required renewal fee to the commission before the
26-27    expiration date of the license or registration.  A person whose
 27-1    license or registration has expired may not engage in activities
 27-2    that require a license or registration until the license or
 27-3    registration has been renewed.
 27-4          (c)  A person whose license or registration has been expired
 27-5    for 90 days or less may renew the license or registration by paying
 27-6    to the commission a renewal fee that is equal to 1-1/2 times the
 27-7    normally required renewal fee.
 27-8          (d)  A person whose license or registration has been expired
 27-9    for more than 90 days but less than one year may renew the license
27-10    or registration by paying to the commission a renewal fee that is
27-11    equal to two times the normally required renewal fee.
27-12          (e)  A person whose license or registration has been expired
27-13    for one year or more may not renew the license or registration. The
27-14    person may obtain a new license or registration by complying with
27-15    the requirements and procedures, including the examination
27-16    requirements, for obtaining an original license or registration.
27-17          (f)  A person who was licensed or registered in this state,
27-18    moved to another state, and is currently licensed or registered and
27-19    has been in practice in the other state for the two years preceding
27-20    the date of application may obtain a new license or registration
27-21    without reexamination.  The person must pay to the commission a fee
27-22    that is equal to two times the normally required renewal fee for
27-23    the license or registration.
27-24          (g)  Not later than the 30th day before the date a person's
27-25    license or registration is scheduled to expire, the commission
27-26    shall send written notice of the impending expiration to the person
27-27    at the person's last known address according to the records of the
 28-1    commission.
 28-2          SECTION 25. Section 116.034, Natural Resources Code, is
 28-3    amended by adding Subsections (d)-(h) to read as follows:
 28-4          (d)  Not later than the 30th day after the date a person
 28-5    takes a licensing or registration examination under this chapter,
 28-6    the commission shall notify the person of the results of the
 28-7    examination.
 28-8          (e)  If the examination is graded or reviewed by a testing
 28-9    service:
28-10                (1)  the commission shall notify the person of the
28-11    results of the examination not later than the 14th day after the
28-12    date the commission receives the results from the testing service;
28-13    and
28-14                (2)  if notice of the examination results will be
28-15    delayed for longer than 90 days after the examination date, the
28-16    commission shall notify the person of the reason for the delay
28-17    before the 90th day.
28-18          (f)  The commission may require a testing service to notify a
28-19    person of the results of the person's examination.
28-20          (g)  If requested in writing by a person who fails a
28-21    licensing or registration examination administered under this
28-22    chapter, the commission shall furnish the person with an analysis
28-23    of the person's performance on the examination.
28-24          (h)  The commission shall recognize, prepare, or administer
28-25    continuing education programs for its licensees and registrants. A
28-26    licensee or registrant must participate in the programs to the
28-27    extent required by the commission to keep the person's license.
 29-1          SECTION 26. Subchapter C, Chapter 116, Natural Resources
 29-2    Code, is amended by adding Sections 116.0345 and 116.0346 to read
 29-3    as follows:
 29-4          Sec. 116.0345.  LICENSE OR REGISTRATION BY ENDORSEMENT. The
 29-5    commission may waive any prerequisite to obtaining a license or
 29-6    registration for an applicant after reviewing the applicant's
 29-7    credentials and determining that the applicant holds a license or
 29-8    registration issued by another jurisdiction that has licensing
 29-9    requirements substantially equivalent to those of this state.
29-10          Sec. 116.0346.  PROVISIONAL LICENSE OR REGISTRATION. (a)  The
29-11    commission may issue a provisional license or registration to an
29-12    applicant currently licensed or registered in another jurisdiction
29-13    who seeks a license or registration in this state and who:
29-14                (1)  has been licensed or registered in good standing
29-15    for at least two years in another jurisdiction, including a foreign
29-16    country, that has licensing or registration requirements
29-17    substantially equivalent to the requirements of this chapter;
29-18                (2)  has passed a national or other examination
29-19    recognized by the commission relating to the activities regulated
29-20    under this chapter; and
29-21                (3)  is sponsored by a person licensed or registered by
29-22    the commission under this chapter with whom the provisional license
29-23    or registration holder will practice during the time the person
29-24    holds a provisional license or registration.
29-25          (b)  The commission may waive the requirement of Subsection
29-26    (a)(3) for an applicant if the commission determines that
29-27    compliance with that subsection would be a hardship to the
 30-1    applicant.
 30-2          (c)  A provisional license or registration is valid until the
 30-3    date the commission approves or denies the provisional license or
 30-4    registration holder's application for a license or registration.
 30-5    The commission shall issue a license or registration under this
 30-6    chapter to the provisional license or registration holder if:
 30-7                (1)  the provisional license or registration holder is
 30-8    eligible to be licensed or registered under Section 116.0345; or
 30-9                (2)  the provisional license or registration holder:
30-10                      (A)  passes the part of the examination under
30-11    Section 116.034 that relates to the applicant's knowledge and
30-12    understanding of the laws and rules relating to the activities
30-13    regulated under this chapter in this state;
30-14                      (B)  meets the academic and experience
30-15    requirements for a license or registration under this chapter; and
30-16                      (C)  satisfies any other licensing or
30-17    registration requirements under this chapter.
30-18          (d)  The commission must approve or deny a provisional
30-19    license or registration holder's application for a license or
30-20    registration not later than the 180th day after the date the
30-21    provisional license or registration is issued.  The commission may
30-22    extend the 180-day period if the results of an examination have not
30-23    been received by the commission before the end of that period.
30-24          (e)  The commission may establish a fee for provisional
30-25    licenses or registrations in an amount reasonable and necessary to
30-26    cover the cost of issuing the license or registration.
30-27          SECTION 27. The heading to Section 116.037, Natural Resources
 31-1    Code, is amended to read as follows:
 31-2          Sec. 116.037.  DISCIPLINARY ACTION [SUSPENSION AND REVOCATION
 31-3    OF LICENSE].
 31-4          SECTION 28. Section 116.037, Natural Resources Code, is
 31-5    amended by amending Subsections (f) and (g) and adding Subsection
 31-6    (h) to read as follows:
 31-7          (f)  The [If the] commission shall revoke, suspend, or refuse
 31-8    to renew the license or registration or shall reprimand the
 31-9    licensee or registrant if the commission finds that the licensee or
31-10    registrant has violated or failed to comply with or is violating or
31-11    failing to comply with this chapter or a rule adopted under this
31-12    chapter[, the commission may suspend the license or registration
31-13    for a definite period not to exceed 90 days or may revoke the
31-14    license].
31-15          (g)  The commission may place on probation a person whose
31-16    license or registration is suspended.  If a license or registration
31-17    suspension is probated, the commission may require the person:
31-18                (1)  to report regularly to the commission on matters
31-19    that are the basis of the probation;
31-20                (2)  to limit practice to the areas prescribed by the
31-21    commission; or
31-22                (3)  to continue or review professional education until
31-23    the person attains a degree of skill satisfactory to the commission
31-24    in those areas that are the basis of the probation.
31-25          (h)  Any party to a proceeding before the commission is
31-26    entitled to judicial review under the substantial evidence rule.
31-27          SECTION 29. Subtitle D, Title 3, Natural Resources Code, is
 32-1    amended by adding Chapter 118 to read as follows:
 32-2               CHAPTER 118.  PIPELINE ASSESSMENT AND TESTING
 32-3          Sec. 118.001.  AUTHORITY TO REQUIRE PLAN FOR PIPELINE
 32-4    ASSESSMENT OR TESTING. (a)  The commission by rule may require an
 32-5    operator to file for commission approval a plan for assessment or
 32-6    testing of a pipeline if the commission finds that:
 32-7                (1)  there is reason to believe that the pipeline may
 32-8    present a hazard to public health or safety;
 32-9                (2)  the commission lacks adequate information to
32-10    assess the risk to public health or safety presented by the
32-11    pipeline; or
32-12                (3)  a plan is necessary for the commission to initiate
32-13    or complete a pipeline safety investigation.
32-14          (b)  The commission may take enforcement action against a
32-15    person who fails to:
32-16                (1)  submit a required plan; or
32-17                (2)  participate in a pipeline safety investigation.
32-18          Sec. 118.002.  PIPELINES FOR WHICH PLAN MAY BE REQUIRED. The
32-19    rules may apply to interstate pipelines, intrastate pipelines,
32-20    portions of pipeline systems the regulation of which the federal
32-21    government has temporarily delegated to the commission, or
32-22    gathering lines, and to pipelines for the transportation of any
32-23    substance or material under the jurisdiction of the commission, as
32-24    specified by the commission.
32-25          Sec. 118.003.  CONTENTS OF PLAN. The rules  may require that
32-26    a plan include:
32-27                (1)  an identification of risk factors associated with
 33-1    a pipeline system, including population density;
 33-2                (2)  information about prior inspections and
 33-3    maintenance;
 33-4                (3)  information about pressure tests;
 33-5                (4)  information about leaks;
 33-6                (5)  information about operating characteristics;
 33-7                (6)  information about corrosion protection methods;
 33-8    and
 33-9                (7)  other information that may assist the commission
33-10    in assessing the risk to public health or safety presented by the
33-11    pipeline.
33-12          Sec. 118.004.  APPROVAL OF PLAN. The commission may approve a
33-13    plan that complies with rules adopted under this chapter.
33-14          Sec. 118.005.  CONSEQUENCES OF PLAN APPROVAL. The approval of
33-15    a plan by the commission does not constitute a certification or
33-16    representation that the pipeline is in compliance with or exempt
33-17    from applicable safety standards.
33-18          SECTION 30. Subchapter A, Chapter 102, Utilities Code, is
33-19    amended by adding Section 102.006 to read as follows:
33-20          Sec. 102.006.  POWERS AND DUTIES OF STATE OFFICE OF
33-21    ADMINISTRATIVE HEARINGS. (a)  The utility division of the State
33-22    Office of Administrative Hearings shall conduct each hearing in a
33-23    contested case that is not conducted by one or more members of the
33-24    railroad commission.
33-25          (b)  The railroad commission may delegate to the utility
33-26    division of the State Office of Administrative Hearings the
33-27    authority to make a final decision and to issue findings of fact,
 34-1    conclusions of law, and other necessary orders in a proceeding in
 34-2    which there is not a contested issue of fact or law.
 34-3          (c)  The railroad commission by rule shall define the
 34-4    procedures by which it delegates final decision-making authority
 34-5    under Subsection (b).
 34-6          (d)  For purposes of judicial review, an administrative law
 34-7    judge's final decision under Subsection (b) has the same effect as
 34-8    a final decision of the railroad commission unless a member of the
 34-9    commission requests formal review of the decision.
34-10          SECTION 31. Subchapter A, Chapter 104, Utilities Code, is
34-11    amended by adding Section 104.009 to read as follows:
34-12          Sec. 104.009.  ASSISTANCE TO LOW-INCOME CUSTOMERS. (a)  The
34-13    railroad commission by rule shall establish a program to provide
34-14    assistance to low-income customers in paying for gas utility
34-15    service.
34-16          (b)  The gas utility service assistance fund is created as a
34-17    trust fund with the comptroller and shall be administered by the
34-18    railroad commission as a trustee on behalf of recipients of money
34-19    from the fund.  The fund is financed by a fee set by the
34-20    commission.  The fee is allocated to customers based on the amount
34-21    of gas used.
34-22          (c)  The railroad commission shall require a gas utility to
34-23    determine a reduced rate for low-income customers and shall
34-24    reimburse a gas utility from the fund for the difference between
34-25    the reduced rate and the rate that would otherwise be applicable.
34-26          (d)  The railroad commission shall provide for enrolling
34-27    low-income customers in the program established under this section.
 35-1          SECTION 32. Section 104.107, Utilities Code, is amended by
 35-2    amending Subsection (b) and adding Subsection (c) to read as
 35-3    follows:
 35-4          (b)  The 150-day period prescribed by Subsection (a)(2) shall
 35-5    be extended for two days for each day the actual hearing on the
 35-6    merits of the case exceeds 15 days.
 35-7          (c)  If the regulatory authority does not make a final
 35-8    determination concerning a schedule of rates before expiration of
 35-9    the applicable suspension period, the regulatory authority is
35-10    considered to have approved the schedule.  This approval is subject
35-11    to the authority of the regulatory authority thereafter to continue
35-12    a hearing in progress.
35-13          SECTION 33. Section 121.206, Utilities Code, is amended by
35-14    amending Subsection (c) and adding Subsection (d) to read as
35-15    follows:
35-16          (c)  In determining the amount of the penalty, the railroad
35-17    commission shall consider the guidelines adopted under Subsection
35-18    (d).
35-19          (d)  The commission by rule shall adopt guidelines to be used
35-20    in determining the amount of a penalty under this subchapter.  The
35-21    guidelines shall include a penalty calculation worksheet that
35-22    specifies the typical penalty for certain violations, circumstances
35-23    justifying enhancement of a penalty and the amount of the
35-24    enhancement, and circumstances justifying a reduction in a penalty
35-25    and the amount of the reduction.  The guidelines shall take into
35-26    account:
35-27                (1)  the person's history of previous violations of
 36-1    Section 121.201 or a safety standard or rule relating to the
 36-2    transportation of gas and gas pipeline facilities adopted under
 36-3    that section, including the number of previous violations;
 36-4                (2)  the seriousness of the violation and of any
 36-5    pollution resulting from the violation; [and]
 36-6                (3)  any hazard to the health or safety of the public;
 36-7                (4)  the degree of culpability;
 36-8                (5)  the demonstrated good faith of the person charged;
 36-9    and
36-10                (6)  any other factor the commission considers
36-11    relevant.
36-12          SECTION 34. Subchapter C, Chapter 2003, Government Code, is
36-13    amended by adding Section 2003.0491 to read as follows:
36-14          Sec. 2003.0491.  RAILROAD COMMISSION HEARINGS. The utility
36-15    division shall conduct contested case hearings and may make final
36-16    decisions and issue findings of fact, conclusions of law, and other
36-17    necessary orders in other proceedings on behalf of the Railroad
36-18    Commission of Texas as provided by Section 102.006, Utilities Code.
36-19    The provisions of Section 2003.049 apply to a proceeding under this
36-20    section except as otherwise provided by Section 102.006, Utilities
36-21    Code.
36-22          SECTION 35. (a)  Except as otherwise provided by this Act,
36-23    this Act takes effect September 1, 2001.
36-24          (b)  The Railroad Commission of Texas shall adopt rules under
36-25    Section 101.019, Natural Resources Code, as added by this Act, not
36-26    later than January 1, 2002.
36-27          (c)  Section 102.006, Utilities Code, as added by this Act,
 37-1    and Section 2003.0491, Government Code, as added by this Act, apply
 37-2    only to a contested case filed at the Railroad Commission of Texas
 37-3    on or after the effective date of this Act.  A contested case filed
 37-4    at the commission before that date is governed by the law in effect
 37-5    at the time the case is filed, and the former law is continued in
 37-6    effect for that purpose.