TITLE 16. ECONOMIC REGULATION

PART 1. RAILROAD COMMISSION OF TEXAS

CHAPTER 2. INFORMAL COMPLAINT PROCEDURE

16 TAC §2.1

The Railroad Commission of Texas (Commission) proposes to amend §2.1, relating to Informal Complaint Procedure, to correct a reference to the Commission's website.

Kari French, Director, Oversight and Safety Division, has determined that for each year of the first five years the proposed amendment will be in effect, there will be no fiscal effect on state or local government or persons required to comply as a result of the proposed amendment.

Ms. French has determined that for each year of the first five years that the amendment will be in effect the primary public benefit would be the correction in the rule of an outdated reference.

The Commission has determined that the proposed amendment will not have an adverse economic effect on small businesses or micro-businesses.

The Commission has also determined that the proposed amendment will not affect a local economy. Therefore, the Commission has not prepared a local employment impact statement pursuant to Texas Government Code, §2001.022.

The Commission has determined that the amendment does not meet the statutory definition of a major environmental rule as set forth in Texas Government Code, §2001.0225(a); therefore, a regulatory analysis conducted pursuant to that section is not required.

Comments on the proposal may be submitted to Rules Coordinator, Office of General Counsel, Railroad Commission of Texas, P.O. Box 12967, Austin, Texas 78711-2967; online at www.rrc.texas.gov/legal/rules/comment-form-for-proposed-rulemakings; or by electronic mail to rulescoordinator@rrc.texas.gov. The Commission will accept comments until noon (12:00 p.m.) on Monday, January 23, 2017, which is 31 days after publication in the Texas Register. The Commission finds that this comment period is reasonable because the proposal and an online comment form will be available on the Commission's web site more than two weeks prior to Texas Register publication of the proposal, giving interested persons additional time to review, analyze, draft, and submit comments. The Commission encourages all interested persons to submit comments no later than the deadline. The Commission cannot guarantee that comments submitted after the deadline will be considered. For further information, call Ms. French at (512) 463-8559. The status of Commission rulemakings in progress is available at www.rrc.texas.gov/legal/rules/proposed-rules.

The Commission proposes the amendment pursuant to Texas Natural Resources Code §81.058, which authorizes the Commission to impose an administrative penalty against a purchaser, transporter, gatherer, shipper, or seller of natural gas who is a party to an informal complaint resolution proceeding and is determined by the Commission to have failed to participate in the proceeding or failed to provide information requested by the mediator in the proceeding. Section 81.058 also authorizes the Commission to impose an administrative penalty against a purchaser, transporter, or gatherer of natural gas if the Commission determines the person engaged in prohibited discrimination against a shipper or seller because the shipper or seller filed a formal or informal complaint with the Commission.

Texas Natural Resources Code §81.058 is affected by the proposed amendment.

Statutory Authority: Texas Natural Resources Code §81.058.

Cross-reference to statute: Texas Natural Resources Code §81.058.

§2.1.Informal Complaint Procedure.

(a) - (d) (No change.)

(e) Informal complaint process.

(1) An informal complaint proceeding is initiated by filing a complaint with the Commission by:

(A) (No change.)

(B) submitting a complaint in writing by:

(i) - (ii) (No change.)

(iii) internet submission by accessing the online form on the Gas Services page of the Commission's website [following URL: http://www.rrc.state.tx.us/divisions/gs/mos/complaints/icp.html].

(2) - (13) (No change.)

(f) - (h) (No change.)

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on December 6, 2016.

TRD-201606325

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: January 22, 2017

For further information, please call: (512) 475-1295


CHAPTER 7. GAS SERVICES DIVISION

The Railroad Commission of Texas (Commission) proposes to amend §7.315, relating to Filing of Tariffs, and §7.7101, relating to Interim Rate Adjustments, to correct references to the Commission's website.

Kari French, Director, Oversight and Safety Division, has determined that for each year of the first five years the proposed amendments will be in effect, there will be no fiscal effect on state or local government or persons required to comply as a result of the proposed amendments.

Ms. French has determined that for each year of the first five years that the amendments will be in effect the primary public benefit would be the correction of an outdated reference.

The Commission has determined that the proposed amendments will not have an adverse economic effect on small businesses or micro-businesses.

The Commission has also determined that the proposed amendments will not affect a local economy. Therefore, the Commission has not prepared a local employment impact statement pursuant to Texas Government Code, §2001.022.

The Commission has determined that the amendments do not meet the statutory definition of a major environmental rule as set forth in Texas Government Code, §2001.0225(a); therefore, a regulatory analysis conducted pursuant to that section is not required.

Comments on the proposal may be submitted to Rules Coordinator, Office of General Counsel, Railroad Commission of Texas, P.O. Box 12967, Austin, Texas 78711-2967; online at www.rrc.texas.gov/legal/rules/comment-form-for-proposed-rulemakings; or by electronic mail to rulescoordinator@rrc.texas.gov. The Commission will accept comments until noon (12:00 p.m.) on Monday, January 23, 2017, which is 31 days after publication in the Texas Register. The Commission finds that this comment period is reasonable because the proposal and an online comment form will be available on the Commission's web site more than two weeks prior to Texas Register publication of the proposal, giving interested persons additional time to review, analyze, draft, and submit comments. The Commission encourages all interested persons to submit comments no later than the deadline. The Commission cannot guarantee that comments submitted after the deadline will be considered. For further information, call Ms. French at (512) 463-8559. The status of Commission rulemakings in progress is available at www.rrc.texas.gov/legal/rules/proposed-rules.

SUBCHAPTER C. RECORDS AND REPORTS; TARIFFS; GAS UTILITY TAX

16 TAC §7.315

The Commission proposes the amendment under Texas Utilities Code, §102.001, which gives the Railroad Commission exclusive original jurisdiction over the rates and services of a gas utility distributing natural gas or synthetic natural gas in areas outside a municipality; Texas Utilities Code, §102.151, which requires gas utilities to file schedules showing all rates for a gas utility service, product, or commodity offered by the gas utility and each rule or regulation that relates to or affects a rate of the gas utility or a gas utility service, product, or commodity furnished by the gas utility; Texas Utilities Code, §104.001, which vests in the Railroad Commission all the authority and power of this state to ensure compliance with the obligations of gas utilities in Texas Utilities Code, Title 3, Subtitle A, and which authorizes the Commission to adopt rules for determining the classification of customers and services; and Texas Utilities Code, §104.301, relating to a utility's ability to file with the Commission a tariff or rate schedule that provides for an interim adjustment in the utility's monthly customer charge or initial block rate to recover the cost of changes in the investment in capital for gas utility service.

Texas Utilities Code §§102.001, 102.151, 104.001, and 104.301 are affected by the proposed amendment.

Statutory authority: Texas Utilities Code, §§102.001, 102.151, 104.001, and 104.301.

Cross reference to statutes: Texas Utilities Code Chapters 102 and 104.

§7.315.Filing of Tariffs.

(a) Filing requirements for all tariffs. Each gas utility shall file with the Commission through the Commission's web site using an electronic format as prescribed by the Commission and the instructions contained in the Electronic Data Interchange (EDI) manual on the Commission's web site a tariff complying with minimum requirements as defined in subsections (c) and (d) of this section for all rates which are within the original or appellate jurisdiction of the Commission and which are currently in force for any gas utility service, product, or commodity. If the rate charged is based on a formula or requires a calculation to determine the unit rate to be charged, the utility shall, in the tariff filing, identify and report all components used in the calculation of the unit rate, including each component of the cost of gas. Each utility providing gas distribution system service or sales shall file, as part of the rates, copies of all rules and regulations relating to or affecting rates, utility service, products, or commodities furnished by the gas utility. Electronic filing instructions may be obtained on the Gas Services page of [from] the Commission's web site [at www.rrc.state.tx.us/electronic_filing/electronic_filing.html].

(b) - (f) (No change.)

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on December 6, 2016.

TRD-201606327

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: January 22, 2017

For further information, please call: (512) 475-1295


SUBCHAPTER H. INTERIM RATE ADJUSTMENTS

16 TAC §7.7101

The Commission proposes the amendment under Texas Utilities Code, §102.001, which gives the Railroad Commission exclusive original jurisdiction over the rates and services of a gas utility distributing natural gas or synthetic natural gas in areas outside a municipality; Texas Utilities Code, §102.151, which requires gas utilities to file schedules showing all rates for a gas utility service, product, or commodity offered by the gas utility and each rule or regulation that relates to or affects a rate of the gas utility or a gas utility service, product, or commodity furnished by the gas utility; Texas Utilities Code, §104.001, which vests in the Railroad Commission all the authority and power of this state to ensure compliance with the obligations of gas utilities in Texas Utilities Code, Title 3, Subtitle A, and which authorizes the Commission to adopt rules for determining the classification of customers and services; and Texas Utilities Code, §104.301, relating to a utility's ability to file with the Commission a tariff or rate schedule that provides for an interim adjustment in the utility's monthly customer charge or initial block rate to recover the cost of changes in the investment in capital for gas utility service.

Texas Utilities Code §§102.001, 102.151, 104.001, and 104.301 are affected by the proposed amendment.

Statutory authority: Texas Utilities Code, §§102.001, 102.151, 104.001, and 104.301.

Cross reference to statutes: Texas Utilities Code Chapters 102 and 104.

§7.7101.Interim Rate Adjustments.

(a) - (c) (No change.)

(d) Annual project report. A gas utility seeking to implement an interim rate adjustment shall electronically file with the Commission an annual project report as part of the application.

(1) The annual project report shall be made on a form approved by the Commission and found on the Gas Services page of [made available via] the Commission's website [at http://www.rrc.state.tx.us/divisions/gs/gsforms/index.html].

(2) - (3) (No change.)

(e) Annual earnings monitoring report. A gas utility seeking to implement an interim rate adjustment shall electronically file with the Commission an annual earnings monitoring report as part of the application.

(1) The annual earnings monitoring report shall be made on a form approved by the Commission and found on the Gas Services page of [made available via] the Commission's website [at http://www.rrc.state.tx.us/divisions/gs/gsforms/index.html].

(2) (No change.)

(f) - (m) (No change.)

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on December 6, 2016.

TRD-201606328

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: January 22, 2017

For further information, please call: (512) 475-1295


CHAPTER 8. PIPELINE SAFETY REGULATIONS

The Railroad Commission of Texas (Commission) proposes to amend §8.210, relating to Reports, and §8.301, relating to Required Records and Reporting, to correct references to the Commission's domain name.

Kari French, Director, Oversight and Safety Division, has determined that for each year of the first five years the proposed amendments will be in effect, there will be no fiscal effect on state or local government or persons required to comply as a result of the proposed amendments.

Ms. French has determined that for each year of the first five years that the amendments will be in effect the primary public benefit would be the correction in the rules of an outdated reference.

The Commission has determined that the proposed amendments will not have an adverse economic effect on small businesses or micro-businesses.

The Commission has also determined that the proposed amendments will not affect a local economy. Therefore, the Commission has not prepared a local employment impact statement pursuant to Texas Government Code, §2001.022.

The Commission has determined that the amendments do not meet the statutory definition of a major environmental rule as set forth in Texas Government Code, §2001.0225(a); therefore, a regulatory analysis conducted pursuant to that section is not required.

Comments on the proposal may be submitted to Rules Coordinator, Office of General Counsel, Railroad Commission of Texas, P.O. Box 12967, Austin, Texas 78711-2967; online at www.rrc.texas.gov/legal/rules/comment-form-for-proposed-rulemakings; or by electronic mail to rulescoordinator@rrc.texas.gov. The Commission will accept comments until noon (12:00 p.m.) on Monday, January 23, 2017, which is 31 days after publication in the Texas Register. The Commission finds that this comment period is reasonable because the proposal and an online comment form will be available on the Commission's web site more than two weeks prior to Texas Register publication of the proposal, giving interested persons additional time to review, analyze, draft, and submit comments. The Commission encourages all interested persons to submit comments no later than the deadline. The Commission cannot guarantee that comments submitted after the deadline will be considered. For further information, call Ms. French at (512) 463-8559. The status of Commission rulemakings in progress is available at www.rrc.texas.gov/legal/rules/proposed-rules.

SUBCHAPTER C. REQUIREMENTS FOR NATURAL GAS PIPELINES ONLY

16 TAC §8.210

The Commission proposes the amendment pursuant to Texas Natural Resources Code, §81.051 and §81.052, which give the Commission jurisdiction over all common carrier pipelines in Texas, persons owning or operating pipelines in Texas and their oil and gas wells, and authorize the Commission to adopt all necessary rules for governing and regulating persons and their operations under the jurisdiction of the Commission as set forth in §81.051, including such rules as the Commission may consider necessary and appropriate to implement state responsibility under any federal law or rules governing such persons and their operations.

Texas Natural Resources Code, §81.051 and §81.052 are affected by the proposed amendment.

Statutory authority: Texas Natural Resources Code, §81.051 and §81.052.

Cross-reference to statutes: Texas Natural Resources Code, §81.051 and §81.052.

§8.210.Reports.

(a) Accident, leak, or incident report.

(1) - (2) (No change.)

(3) Written report.

(A) Following the initial telephonic report for accidents, leaks, or incidents described in paragraph (1) of this subsection, the operator who made the telephonic report shall submit to the Commission a written report summarizing the accident or incident. The report shall be submitted as soon as practicable within 30 calendar days after the date of the telephonic report. The written report shall be made on forms supplied by the Department of Transportation. For reports submitted electronically to the Department of Transportation, the operator shall forward a copy of the report and confirmation to the Division or electronically to safety@rrc.texas.gov [safety@rrc.state.tx.us ]. For reports not submitted electronically to the Department of Transportation, the operator shall send to the Division an original signed report form.

(B) - (C) (No change.)

(b) Pipeline safety annual reports.

(1) Except as provided in paragraph (2) of this subsection, each gas company shall submit an annual report for its intrastate systems in the same manner as required by 49 CFR Part 191. The report shall be submitted to the Division on forms supplied by the Department of Transportation not later than March 15 of a year for the preceding calendar year. For reports submitted electronically to the Department of Transportation, the operator may forward a copy of the report and confirmation to the Division or electronically to safety@rrc.texas.gov [safety@rrc.state.tx.us]. For reports not submitted electronically to the Department of Transportation, the operator shall send to the Division an original signed report form.

(2) (No change.)

(c) - (d) (No change.)

(e) Leak Reporting. For purposes of this subsection, the term "leak" includes all underground leaks, all hazardous above ground leaks, and all non-hazardous above ground leaks that cannot be eliminated by lubrication, adjustment, or tightening. Each operator of a gas distribution system, of a regulated plastic gas gathering line, or of a plastic gas transmission line shall submit to the Division a list of all leaks repaired on its pipeline facilities. Each such operator shall list all leaks identified on all pipeline facilities. Each such operator shall also include the number of unrepaired leaks remaining on the operator's systems by leak grade. Each such operator shall submit leak reports using the Commission's online reporting system, Form PS-95, by July 15 and January 15 of each calendar year, in accordance with the PS-95 Semi-Annual Leak Report Electronic Filing Requirements, set out in the Figure in this subsection. The report submitted on July 15 shall include information from the previous January 1 through the previous June 30. The report submitted on January 15 shall include information from the previous July 1 through the previous December 31. The report includes:

(1) - (6) (No change.)

(7) Leak repair method.

Figure: 16 TAC §8.210(e)(7) (No change.)

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on December 6, 2016.

TRD-201606330

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: January 22, 2017

For further information, please call: (512) 475-1295


SUBCHAPTER D. REQUIREMENTS FOR HAZARDOUS LIQUIDS AND CARBON DIOXIDE PIPELINES ONLY

16 TAC §8.301

The Commission proposes the amendment pursuant to Texas Natural Resources Code, §81.051 and §81.052, which give the Commission jurisdiction over all common carrier pipelines in Texas, persons owning or operating pipelines in Texas and their oil and gas wells, and authorize the Commission to adopt all necessary rules for governing and regulating persons and their operations under the jurisdiction of the Commission as set forth in §81.051, including such rules as the Commission may consider necessary and appropriate to implement state responsibility under any federal law or rules governing such persons and their operations.

Texas Natural Resources Code, §81.051 and §81.052 are affected by the proposed amendment.

Statutory authority: Texas Natural Resources Code, §81.051 and §81.052.

Cross-reference to statutes: Texas Natural Resources Code, §81.051 and §81.052.

§8.301.Required Records and Reporting.

(a) Accident reports. In the event of any failure or accident involving an intrastate pipeline facility from which any hazardous liquid or carbon dioxide is released, if the failure or accident is required to be reported by 49 CFR Part 195, the operator shall report to the Commission as follows.

(1) Incidents involving crude oil. In the event of an accident involving crude oil, the operator shall:

(A) (No change.)

(B) within 30 days of discovery of the incident, submit a completed Form H-8 to the Oil and Gas Division of the Commission. In situations specified in the 49 CFR Part 195, the operator shall also file a copy of the required Department of Transportation form with the Division. For reports submitted electronically to the Department of Transportation, the operator shall forward a copy of the report and confirmation to the Division or electronically to safety@rrc.texas.gov [safety@rrc.state.tx.us]. If an operator does not submit reports electronically to the Department of Transportation, the operator shall send the report to the Division on an original signed report form.

(2) Hazardous liquids, other than crude oil, and carbon dioxide. For incidents involving hazardous liquids, other than crude oil, and carbon dioxide, the operator shall:

(A) (No change.)

(B) within 30 days of discovery of the incident, file with the Division a written report using the appropriate Department of Transportation form (as required by 49 CFR Part 195) or a facsimile. For reports submitted electronically to the Department of Transportation, the operator shall forward a copy of the report and confirmation to the Division or electronically to safety@rrc.texas.gov [safety@rrc.state.tx.us ]. If an operator does not submit reports electronically to the Department of Transportation, the operator shall send the report to the Division on an original signed report form.

(b) Annual report. Each operator shall file with the Commission an annual report for its intrastate systems located in Texas in the same manner as required by 49 CFR Part 195. The report shall be filed with the Commission on forms supplied by the Department of Transportation on or before June 15 of a year for the preceding calendar year reported. For reports submitted electronically to the Department of Transportation, the operator may forward a copy of the report and confirmation to the Division or electronically to safety@rrc.texas.gov [safety@rrc.state.tx.us]. For reports not submitted electronically to the Department of Transportation, the operator shall send to the Division an original signed report form.

(c) - (d) (No change.)

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on December 6, 2016.

TRD-201606331

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: January 22, 2017

For further information, please call: (512) 475-1295


CHAPTER 12. COAL MINING REGULATIONS

SUBCHAPTER J. BOND AND INSURANCE REQUIREMENTS FOR SURFACE COAL MINING AND RECLAMATION OPERATIONS

DIVISION 3. FORM, CONDITIONS, AND TERMS OF PERFORMANCE BOND AND LIABILITY INSURANCE

16 TAC §12.309

The Railroad Commission of Texas (Commission) proposes to amend §12.309, relating to Terms and Conditions of the Bond, concerning the requirements to qualify for self-bonding. The Commission proposes to amend subsection (j)(2)(B) to remove the restriction on self-bonding for an applicant who has been subject to a bankruptcy proceeding in the five years prior to the application. The Commission proposes the amendment because the current wording conflicts with the federal Bankruptcy Code (11 U.S.C. §525(a)) and United States Supreme Court case law interpreting that statute.

Denny Kingsley, Director, Surface Mining and Reclamation Division, has determined that for each year of the first five years the proposed amendment will be in effect, there will be no fiscal impact on state or local governments as a result of the proposed amendment.

Mr. Kingsley has determined that for each year of the first five years the proposed amendment will be in effect there will be neither an increase nor decrease in the economic cost to the mining industry as a result of this amendment. The amendment merely conforms the Commission's rule with the federal Bankruptcy Code.

Mr. Kingsley has also determined that for each year of the first five years the amendment will be in effect, the primary public benefit will be consistency with applicable federal statutes.

In accordance with Texas Government Code, §2006.002, the Commission has determined that there will be no adverse economic effects on small businesses or micro-businesses resulting from the proposed amendment; therefore, the Commission has not prepared the economic impact statement or regulatory flexibility analysis required under §2006.002(c).

The Commission has determined that the proposed amendment will not affect a local economy; therefore, the Commission has not prepared a local employment impact statement pursuant to Texas Government Code, §2002.022.

The Commission has determined that the proposed rule does not meet the statutory definition of a major environmental rule as set forth in Texas Government Code, §2001.0225; therefore, a regulatory analysis pursuant to that section is not required.

Comments on the proposal may be submitted to Rules Coordinator, Office of General Counsel, Railroad Commission of Texas, P.O. Box 12967, Austin, Texas 78711-2967; online at www.rrc.texas.gov/legal/rules/comment-form-for-proposed-rulemakings; or by electronic mail to rulescoordinator@rrc.texas.gov. Comments should refer to Docket No. SMRD 1-16. The Commission will accept comments until 12:00 p.m. (noon) on Monday, January 23, 2017, which is 31 days after publication in the Texas Register. The Commission has determined this is a reasonable opportunity for interested persons to submit data, views, or arguments, as required by Texas Government Code, §2001.029, because the proposal and an online comment form will be available on the Commission's website no later than the day after the open meeting at which the Commission approves publication of the proposal, giving interested persons additional time to review and analyze the proposal and to draft and submit comments.

The Commission encourages all interested persons to submit comments on the proposal no later than the deadline. The Commission cannot guarantee that comments submitted after the deadline will be considered. For further information, call Mr. Kingsley at (512) 305-8840. The status of pending Commission rulemakings is available at www.rrc.texas.gov/legal/rules/proposed-rules.

The Commission proposes the amendment under Texas Natural Resources Code, §134.013, which authorizes the Commission to promulgate rules pertaining to surface coal mining operations.

Statutory authority: Texas Natural Resources Code, §134.013.

Cross-reference to statute: Texas Natural Resources Code, §134.013.

§12.309.Terms and Conditions of the Bond.

(a) - (i) (No change.)

(j) Self-bonding.

(1) (No change.)

(2) Requirements for a business and governmental entities. The Commission may accept a self bond from an applicant that is a business or governmental entity if all of the following conditions are met by the applicant:

(A) (No change.)

(B) the applicant has been in continuous operation for a period of not less than 5 years immediately preceding the date of application [and has not been subject to bankruptcy proceedings during that time].

(i) - (ii) (No change.)

(C) - (D) (No change.)

(3) - (7) (No change.)

(k) - (l) (No change.)

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on December 6, 2016.

TRD-201606320

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: January 22, 2017

For further information, please call: (512) 475-1295


CHAPTER 18. UNDERGROUND PIPELINE DAMAGE PREVENTION

16 TAC §18.11

The Railroad Commission of Texas (Commission) proposes to amend §18.11, relating to Reporting Requirements, to correct a reference to the Commission's website.

Kari French, Director, Oversight and Safety Division, has determined that for each year of the first five years the proposed amendment will be in effect, there will be no fiscal effect on state or local government or persons required to comply as a result of the proposed amendment.

Ms. French has determined that for each year of the first five years that the amendment will be in effect the primary public benefit would be the correction in the rule of an outdated reference.

The Commission has determined that the proposed amendment will not have an adverse economic effect on small businesses or micro-businesses.

The Commission has also determined that the proposed amendment will not affect a local economy. Therefore, the Commission has not prepared a local employment impact statement pursuant to Texas Government Code, §2001.022.

The Commission has determined that the amendment does not meet the statutory definition of a major environmental rule as set forth in Texas Government Code, §2001.0225(a); therefore, a regulatory analysis conducted pursuant to that section is not required.

Comments on the proposal may be submitted to Rules Coordinator, Office of General Counsel, Railroad Commission of Texas, P.O. Box 12967, Austin, Texas 78711-2967; online at www.rrc.texas.gov/legal/rules/comment-form-for-proposed-rulemakings; or by electronic mail to rulescoordinator@rrc.texas.gov. The Commission will accept comments until noon (12:00 p.m.) on Monday, January 23, 2017, which is 31 days after publication in the Texas Register. The Commission finds that this comment period is reasonable because the proposal and an online comment form will be available on the Commission's web site more than two weeks prior to Texas Register publication of the proposal, giving interested persons additional time to review, analyze, draft, and submit comments. The Commission encourages all interested persons to submit comments no later than the deadline. The Commission cannot guarantee that comments submitted after the deadline will be considered. For further information, call Ms. French at (512) 463-8559. The status of Commission rulemakings in progress is available at www.rrc.texas.gov/legal/rules/proposed-rules.

The Commission proposes the amendment pursuant to Texas Natural Resources Code, §117.012, and Texas Utilities Code, §121.201, which authorize the Commission to adopt rules that include safety standards for and practices applicable to the intrastate transportation of hazardous liquids or carbon dioxide by pipeline and intrastate hazardous liquid or carbon dioxide pipeline facilities, including safety standards related to the prevention of damage to such a facility resulting from the movement of earth by a person in the vicinity of the facility, other than movement by tillage that does not exceed a depth of 16 inches. In addition, the Commission proposes the amendment pursuant to Texas Health and Safety Code, §756.106, which authorizes the Commission to adopt and enforce safety standards and best practices, including those described by 49 U.S.C. §6105 et seq., relating to the prevention of damage by a person to a facility under the jurisdiction of the Commission.

Texas Natural Resources Code §117.012, Texas Utilities Code §121.201, and Texas Health and Safety Code, §756.126, are affected by the proposed amendment.

Statutory authority: Texas Natural Resources Code §117.012, Texas Utilities Code §121.201, and Texas Health and Safety Code §756.126.

Cross-reference to statute: Texas Natural Resources Code §117.012; Texas Utilities Code §121.201, and Texas Health and Safety Code §756.126.

§18.11.Reporting Requirements.

(a) Each operator of an underground pipeline shall report to the Commission all damage to its pipelines caused by an excavator. Within 10 days of the damage incident or of the operator's actual knowledge of the damage incident, an operator shall submit the information to the Commission through TDRF, which may be accessed through the Commission's online reporting system [at http://www.rrc.state.tx.us/formpr/index.html ] using its assigned operator identification code.

(b) Each excavator that damages an underground pipeline shall notify the operator of the damage through the notification center immediately but not later than two hours following the damage incident. The excavator shall also submit report of the damage incident to the Commission using TDRF, which may be accessed through the Commission's online reporting system [at http://www.rrc.state.tx.us/formpr/index.html ] and the excavator sign-in, within 10 days of the incident.

(c) (No change.)

(d) An emergency response official, a member of the general public, or another person aware of damage to an underground pipeline is encouraged to submit an incident form using TDRF, which can be accessed through the Commission's online reporting system [at http://www.rrc.state.tx.us/formpr/index.html]. Entries can be made through the general public or emergency response official sign-in.

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on December 6, 2016.

TRD-201606333

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: January 22, 2017

For further information, please call: (512) 475-1295


CHAPTER 20. ADMINISTRATION

SUBCHAPTER A. CONTRACTS AND PURCHASES

DIVISION 3. CONTRACT MONITORING

16 TAC §20.81

The Railroad Commission of Texas (Commission) proposes new §20.81, relating to Enhanced Contract Monitoring. The Commission proposes the new rule pursuant to Texas Government Code §2261.253(c), which was added by Senate Bill 20 (84th Legislature, 2015) and requires state agencies to establish a procedure to identify each contract that requires enhanced contract monitoring and submit information on the contract to the agency's governing body. It also requires that the agency's contract management office or procurement director immediately notify the agency's governing body of any serious issue or risk that is identified with respect to a contract monitored under the statute.

The proposed new rule lists the factors that the Commission will use to assess each contract and determine whether enhanced contract monitoring is necessary. The factors include the complexity of the services, the contract amount, whether the services or vendor are new or have changed significantly, and any other factors that may impact the project. The proposed new rule also specifies what the Commission may require of a vendor if the Commission determines that a contract requires enhanced monitoring, and identifies Commission staff who are responsible for monitoring contracts.

Sandy Williams, Director, Procurement and Contracts Management, Administration Division, has determined that for each year of the first five years the new rule will be in effect there will be no fiscal implications for state or local governments as a result of the new rule. In addition, there is no anticipated cost for persons required to comply with the proposed rule.

Ms. Williams has determined that for each year of the first five years the proposed new rule will be in effect, the anticipated public benefit will be enhanced monitoring of Commission contracts and Commission compliance with recent changes to state agency contract requirements.

The Commission has determined that the proposed new rule will not have an adverse economic effect on small businesses or micro-businesses. Therefore, the Commission has not prepared the economic impact statement or the regulatory flexibility analysis pursuant to Texas Government Code §2006.002.

The Commission has also determined that the proposed new rule will not affect a local economy. Therefore, the Commission has not prepared a local employment impact statement pursuant to Texas Government Code §2001.022.

The Commission has determined that the new rule does not meet the statutory definition of a major environmental rule as set forth in Texas Government Code, §2001.0225(a); therefore, a regulatory analysis conducted pursuant to that section is not required.

Comments on the proposed new rule may be submitted to Rules Coordinator, Office of General Counsel, Railroad Commission of Texas, P.O. Box 12967, Austin, Texas 78711-2967; online at www.rrc.texas.gov/legal/rules/comment-form-for-proposed-rulemakings; or by electronic mail to rulescoordinator@rrc.texas.gov. The Commission will accept comments until noon (12:00 p.m.) on Monday, January 23, 2017, which is 31 days after publication in the Texas Register. The Commission finds that this comment period is reasonable because the proposal and an online comment form will be available on the Commission's website more than two weeks prior to Texas Register publication of the proposal, giving interested persons additional time to review, analyze, draft, and submit comments. The Commission cannot guarantee that comments submitted after the deadline will be considered. For further information, call Sandy Williams at (512) 463-7680. The status of Commission rulemakings in progress is available at www.rrc.texas.gov/legal/rules/proposed-rules.

The Commission proposes the new rule under Texas Government Code §2261.253, which requires the Commission to establish a procedure to identify each contract that requires enhanced contract or performance monitoring, and Texas Natural Resources Code §81.051 and §81.052, which provide the Commission with jurisdiction over all persons owning or engaged in drilling or operating oil or gas wells in Texas and the authority to adopt all necessary rules for governing and regulating persons and their operations under Commission jurisdiction.

Texas Natural Resources Code, §81.051 and §81.052 are affected by the proposed new rule.

Statutory authority: Texas Natural Resources Code §81.051 and §81.052, and Texas Government Code §2261.253.

Cross-reference to statutes: Texas Natural Resources Code §81.051 and §81.052 and Texas Government Code §2261.253.

§20.81.Enhanced Contract Monitoring.

(a) The Commission shall use the following factors to assess each contract and determine whether enhanced contract monitoring is necessary.

(1) the complexity of the services;

(2) the contract amount;

(3) whether the services or vendor are new or have changed significantly; and

(4) any other factors that may impact the project.

(b) If the Commission determines that a contract requires enhanced monitoring, the Commission will require that the vendor provide status reports on a scheduled basis to determine whether performance measures are being met. Enhanced monitoring may also include site visits, additional meetings with the vendor, and other documentation requirements needed to assess progress toward meeting performance measures.

(c) The Director of Procurement and Contracts Management shall notify the Commissioners of contracts requiring enhanced monitoring under this section. The Director shall also immediately notify the Commissioners of any serious issue or risk that is identified in a contract monitored under this section.

(d) This section does not apply to an interagency agreement, interlocal agreement, a memorandum of understanding with another state agency, or a contract for which there is no cost to the Commission.

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on December 6, 2016.

TRD-201606324

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: January 22, 2017

For further information, please call: (512) 475-1295