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A BILL TO BE ENTITLED
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AN ACT
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relating to the regulation of cemeteries and the administration of |
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perpetual care trust funds. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 711.056(a), Health and Safety Code, is |
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amended to read as follows: |
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(a) If after a hearing conducted as provided by Chapter |
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2001, Government Code, the trier of fact finds that a violation of |
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this chapter or a rule of the Finance Commission of Texas |
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establishes a pattern of wilful disregard for the requirements of |
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this chapter or rules of the finance commission, the trier of fact |
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may [shall] recommend to the commissioner that the maximum |
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administrative penalty permitted under Section 711.055 be imposed |
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on the person committing the violation or that the commissioner |
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cancel or not renew: |
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(1) the person's registration under Subchapter C-1, if |
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the person is registered under that subchapter; or |
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(2) the person's permit under Chapter 154, Finance |
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Code, if the person holds such a permit. |
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SECTION 2. Section 712.0034, Health and Safety Code, is |
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amended by amending Subsection (b) and adding Subsection (c) to |
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read as follows: |
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(b) To qualify for a certificate of authority under this |
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chapter, an applicant must demonstrate to the satisfaction of the |
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commissioner that: |
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(1) the applicant's business ability, experience, |
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character, financial condition, and general fitness warrant the |
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public's confidence; |
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(2) the cemetery operations manager has at least two |
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years of experience in cemetery management; |
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(3) the issuance of the certificate of authority is in |
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the public interest; |
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(4) the applicant, a principal of the applicant, or a |
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person who controls the applicant does not owe the department a |
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delinquent fee, assessment, administrative penalty, or other |
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amount imposed under this chapter or a rule adopted or order issued |
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under this chapter; and |
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(5) the applicant corporation: |
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(A) is in good standing and statutory compliance |
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with this state; |
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(B) is authorized to engage in the perpetual care |
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cemetery business in this state; [and] |
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(C) does not owe any delinquent franchise or |
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other taxes to this state; and |
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(D) wholly owns all land on which the perpetual |
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care cemetery will be located. |
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(c) For purposes of Subsection (b)(5)(D), an applicant |
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corporation is considered to wholly own land regardless of whether |
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the land is subject to a mortgage, deed of trust, or other lien. |
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SECTION 3. Section 712.0037, Health and Safety Code, is |
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amended by adding Subsections (a-1) and (a-2) to read as follows: |
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(a-1) Notwithstanding Subsection (a), a certificate holder |
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holding a certificate of authority issued before September 1, 2017, |
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that does not on that date satisfy the ownership requirement under |
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712.0034(b)(5)(D) is not required to satisfy that ownership |
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requirement as a condition of renewal until September 1, 2022. The |
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commissioner may extend the period of compliance for the ownership |
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requirement if the certificate holder: |
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(1) files a written application for the extension in |
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the form and manner required by the department; and |
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(2) shows good cause for the extension. |
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(a-2) This subsection and Subsection (a-1) expire September |
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1, 2028. |
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SECTION 4. Section 712.021, Health and Safety Code, is |
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amended by amending Subsections (a) and (g) and adding Subsection |
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(h) to read as follows: |
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(a) Except as provided by Subsection (h), a [A] corporation |
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that operates a perpetual care cemetery in this state shall have a |
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fund established with a trust company or a bank with trust powers |
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that is located in this state. The trust company or bank may not |
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have more than one director who is also a director of the |
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corporation. |
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(g) In this subsection, "master trust account" means an |
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account containing the perpetual care trust funds of two or more |
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certificate holders for the purpose of collective investment and |
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administration. The trustors of two or more perpetual care trust |
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funds may establish a master [common] trust account [fund] in which |
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deposits required by this chapter are made, provided that separate |
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records of principal and income are maintained for each perpetual |
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care cemetery for the benefit of which the master [common] trust |
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account [fund] is established, and further provided that the income |
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attributable to each perpetual care cemetery is used only for the |
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perpetual care of that cemetery. |
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(h) A corporation may apply to the commissioner for |
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temporary relief and placement of a perpetual care trust fund in a |
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segregated interest bearing account at a Texas financial |
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institution, as defined by Section 201.101, Finance Code, if the |
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corporation: |
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(1) has been operating a perpetual care cemetery in |
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this state for at least two years; and |
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(2) has a perpetual care trust fund with a balance of |
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less than $100,000, the income of which is insufficient to pay |
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trustee fees. |
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SECTION 5. This Act takes effect September 1, 2017. |