TITLE 16. ECONOMIC REGULATION

PART 1. RAILROAD COMMISSION OF TEXAS

CHAPTER 1. PRACTICE AND PROCEDURE

The Railroad Commission of Texas proposes the repeal of rules in Chapter 1, Subchapters A through H, §§1.1 - 1.10, 1.21 - 1.30, 1.41 - 1.49, 1.61 - 1.65, 1.81 - 1.87, 1.101 - 1.108, 1.121 - 1.130, 1.141 - 1.152, and simultaneously proposes the following new subchapters and rules in Chapter 1: in new subchapter A, new §§1.1 - 1.10, relating to Definitions and General Provisions; in new subchapter B, new §§1.21 - 1.27, relating to Initiation of Contested Case Proceeding; in new subchapter C, new §§1.31 - 1.38, relating to Pleadings, Motions, and Other Documents; in new subchapter D, new §§1.41 - 1.45, relating to Notice and Service; in new subchapter E, new §§1.51 - 1.57, relating to Discovery; in new subchapter F, new §§1.61 - 1.68, relating to Evidence; in new Subchapter G, new §§1.101 - 1.112, relating to Hearings; and in new Subchapter H, §§1.121 - 1.131, relating to Decision; and in new Subchapter J, new §1.301, relating to Rulemaking.

The Commission proposes the repeals and new sections to reorganize and update the rules in this chapter to clarify current Commission practice and procedures and reflect changes in statutory requirements. In preparation for this proposal, Commission staff circulated an informal draft and received several comments, some of which are summarized below.

One comment stated the proposed definition of "affected party or person" in §1.2 could conflict with definitions in existing law and rules that the Commission has applied in the past. The comment also stated that the term "party" is already defined in the Administrative Procedure Act, but "affected party" is not.

Because the terms "affected person" or "affected party" no longer appear in Chapter 1, the definition has been removed.

The same commenter stated that the definition of "Commission," which is already defined in the Texas Natural Resources Code, could devalue the authority of a single Commissioner, because it potentially lessens his or her ability to speak on policy and matters of interest to the Commission. The comment also said the addition of the delegated authority to an employee is unnecessary and elevates an employee above a single Commissioner.

Commission staff disagrees with these comments. The Commission as an agency may only exercise its authority through a quorum of Commissioners in an open meeting, or through an employee of the Commission that has been delegated authority. If one Commissioner acts in his or her individual capacity, it is not an act of the Commission.

One comment stated that the phrase "The whole or a part of" is unnecessary in the definition of "license."

Commission staff notes that its definition of license comes from Texas Government Code, §2001.003.

One comment regarding §1.7 suggested that a service list should be included with a certificate of service.

Commission staff notes that §1.45 requires a service list as part of the certificate of service, but in the informal draft, §1.45 referred to "certification" instead of "certificate of service." The wording is corrected in this proposal.

Two comments on §1.21 stated that a document should not be considered filed with the Commission unless it meets the requirements in Chapter 1.

Staff understands this concern and has modified §1.21 to allow the Commission to reject a document if it does not comply with applicable requirements.

One comment regarding §1.22 noted that the presumption of filing at or before 5:00 p.m. in subsection (d) is not appropriate if an examiner requires the filings to be made by a certain time such as 10:00 a.m.

The proposal includes wording to contemplate alternative filing deadlines imposed by an examiner.

One comment addressed both §1.23(c)(1) and §1.35(b); the comment suggested that the time the respondent has to file a response to a complaint should be consistent in both rules. The comment also suggested a change to clarify that the time runs from the date the complainant serves the complaint on the respondent, rather than from the date of the Commission's notice of the complaint. The same clarification should be made in §1.35(b).

Commission staff agrees that the deadline should be consistent, but disagrees that the time for filing a response should run from the date the complainant serves the complaint. The rule has been modified to allow 20 days from the date of the Commission's letter notifying the respondent of the complaint.

A comment stated that the word "shall" in §1.23(f) should be changed to "may" so the rule does not appear to bind the Commissioners to the opinion of an examiner. The proposal has been modified to address this concern.

One comment suggested adding new subsection (g) to §1.23 to read: "(g) Retail customers served by a gas utility as defined in Texas Utilities Code, §§101.003(7), 101.003(8), and 121.001 - 121.006, must first attempt an informal resolution pursuant to §7.45(B)(C) before pursuing a claim against a gas utility under this section."

Commission staff is aware that other laws or rules may address the same topics as Chapter 1 and/or may provide exceptions to the general practices required by Chapter 1. Thus, proposed §1.1 includes the general rule of construction that when a general provision conflicts with a special provision, and the conflict is irreconcilable, the special provision controls. Therefore, if a special provision such as §7.45(B) applies in a specific context, and that provision creates an irreconcilable conflict, the special provision will govern over the general provision in §1.23.

A comment on §1.24(a) stated that classifying a case as a show-cause proceeding shifts the burden of proof to the party seeking to maintain the status quo or otherwise resisting the relief sought; the rule does not have any standards that guide or bind the agency as to when the significant decision to change the burden of proof is justified. The comment suggested that factors be included in the rule.

Commission staff disagrees that the rule should limit the Commission to certain factors.

One comment noted that §1.36 limits the filing of motions to before the contested case is included in an open meeting or conference agenda, which is typically seven days before conference. The comment also noted that this limitation is not currently in place and suggested that the rule should include a good cause exception to contemplate that there might be reasonable situations when the restriction on filing motions is not workable.

The proposal does not include the suggested change. The intent of the proposed amendment is to implement a firm deadline after which motions cannot be filed.

A comment on §1.36(a) regarding the sentence "Notice of action on any motion shall be served promptly on all parties" stated that the word "promptly" is too vague.

The Commission currently provides same-day notice if possible; therefore, this change is not necessary.

A comment on §1.38(d)(5) stated that the phrase "...or the examiner may grant a stay of the interim ruling" should be changed to "....or the examiner may issue a stay of the interim ruling."

The proposal includes this change.

One comment concerned §1.42, which is proposed for repeal and does not have a corresponding new rule. The comment stated that for purposes of completeness, transparency, and accuracy, the rule wording regarding notice of proposed rulemaking should be retained.

Commission staff notes that §1.1 states the Commission will comply with the APA and finds it unnecessary to include in its rules each statute that governs Commission action.

A comment on §1.43 stated that notice of publication was previously limited to oil and gas, and surface mining and reclamation non-rulemaking proceedings, but it is unclear if the new rule would apply to statement of intent proceedings as well.

Commission staff notes the statement of intent statutes and §1.43 apply in different situations. Section 1.43 only applies when a party is unable to identify the address of any person who is required to be notified.

A comment on §1.44 stated that the phrase "a notice of protest may be filed" should be changed to "shall be filed."

Commission staff disagrees that "shall" is appropriate because a notice of protest is not required.

A comment regarding §1.45 stated that Commission service lists always contain and are sometimes dominated by agency personnel; thus, the Commission should encourage the use of email service by allowing Commission staff to be served by email.

Commission staff does not agree with this change should be incorporated into the rule, but will work with divisions to ensure that only essential staff members are included on the service list.

A comment on §1.62 suggested that the rule allow official notice to be taken of Commission records, and documents or records of other state agencies.

Commission staff notes that the rule wording comes from the APA, Texas Government Code, §2001.090.

A comment on §1.65 suggested that copies of exhibits be furnished to the court reporter in addition to examiners and parties.

The proposal includes this modified wording.

A comment on §1.68(c) regarding filing confidential materials with the Commission stated that the new rule is appropriate for the process of filing, but does not seem to grant any exception or justification for the agency to release documents that are confidential by law. The comment stated that the rule may give a false sense of compliance to agency staff and an unwarranted opportunity by third parties to submit everything as "confidential."

Commission staff agrees that the new rule does not expand the Commission's authority or exempt it from the Public Information Act (PIA) requirements in Texas Government Code Chapter 552. The new rule merely defines the process for filing confidential materials so that the Commission can notify the filer if the Commission receives a request for that information and the filer can pursue appropriate action with the Office of the Attorney General. Materials filed pursuant to §1.68 are subject to the PIA and are not exempt from disclosure merely because marked confidential.

One comment suggested that the title of §1.101 be changed to "Examiner's Responsibilities and Duties."

Commission staff disagrees with this suggestion.

A comment stated §1.121(f), which allows an examiner can make clerical or typographical corrections to a previously served proposal for decision (PFD) without serving the correction on the parties, seems problematic because the examiner may correct something he or she deems clerical or typographic, but the parties may consider substantive. The commenter stated that all parties should be notified when any corrections are made to a PFD, as is the current process.

The proposal is modified to require notice of any change to a PFD, but also notes that a clerical change will not create an opportunity for additional exceptions or replies.

A comment on §1.128 stated that the APA, §2001.146(i) requires a subsequent motion for rehearing to be filed within 20 days of the date the order disposing of the original motion for rehearing was signed, not within 25 days as the proposed wording stated.

Commission staff notes that this comment is incorrect; the statute was amended in 2015 to allow 25 days.

Another comment on §1.128(b) stated that a reply to a motion for rehearing is due 40 days after a decision or order, and in accordance with subsection (a), a motion for rehearing is due 25 days after the order or decision, making the reply due 15 days after the original motion is filed. Subsection (b) shrinks the time to 10 days in the event the timing has been extended by an agreement or by Commission order. The comment suggested that 15 days should still be the reply time for consistency. The same commenter also stated that subsection (d) and (e) may have similar time period conflicts.

Commission staff notes that the rule wording is taken directly from the APA.

A separate comment on §1.128 stated that when a motion for rehearing or response to a motion for rehearing is served, the rule should require a service list to be included.

Commission staff notes that any filing, including motions, must be served with a certificate of service and service list, as required in §1.45.

A comment on current §1.146 stated that the Commission should maintain current subsection (b), which is not included in the proposed new rule and provides a time period by which the Commission must issue a final decision or order. The comment stated that removal of subsection (b) is inconsistent with the APA, §2001.143, which states that an agency should sign a decision or order that may become final in a contested case within 60 days of the date on which the hearing closed, except for the same circumstances outlined in current rule §1.146(b).

Commission staff disagrees and declines to include this wording. The Texas Supreme Court has interpreted §2001.143 as directory, not mandatory.

Randall Collins, Director, Hearings Division, has determined that for each year of the first five years the repeals and new rules will be in effect, there will be no fiscal implications for state or local governments as a result of the repeals and new rules. In addition, there is no anticipated cost for persons required to comply with the proposed rules.

Mr. Collins has determined that for each year of the first five years the proposed repeals and new rules will be in effect, the anticipated public benefit will be consistency with the Administrative Procedure Act and increased clarity for those with contested cases before the Commission.

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

Comments on the proposed repeals and new rules 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, May 1, 2017, which is 45 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 Randall Collins at (512) 463-5928. The status of Commission rulemakings in progress is available at www.rrc.texas.gov/legal/rules/proposed-rules.

SUBCHAPTER A. DEFINITIONS AND GENERAL PROVISIONS

16 TAC §§1.1 - 1.10

The Commission proposes the repeals under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.1.Purpose, Scope, and Conflict with Special Rules.

§1.2.Definitions.

§1.3.Suspension of Rules and Waiver of Fees.

§1.4.Violation of Procedural Rules.

§1.5.Conduct and Decorum.

§1.6.Ex Parte Communications.

§1.7.Testimony under Oath or Affirmation.

§1.8.Computation and Extensions of Time.

§1.9.Exceptions.

§1.10.Commissioner Conduct.

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 February 28, 2017.

TRD-201700790

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER B. PLEADINGS

16 TAC §§1.21 - 1.30

The Commission proposes the repeals under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.21.Petition for Adoption of Rules.

§1.22.Classification of Pleadings.

§1.23.Institution of Nonrulemaking Proceedings.

§1.24.Filings with the Legal Division.

§1.25.Form and Content of Pleadings.

§1.26.Correction of Pleadings.

§1.27.Motions.

§1.28.Responsive Pleadings and Emergency Action.

§1.29.Amended or Supplemental Pleadings.

§1.30.Interim Rulings and Appeals of Interim Rulings.

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 February 28, 2017.

TRD-201700791

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER C. DOCKETING, NOTICE, AND SERVICE

16 TAC §§1.41 - 1.49

The Commission proposes the repeals under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.41.Docketing.

§1.42.Notice of Rulemaking Proceedings.

§1.43.Notice of Application in Nonrulemaking Proceedings.

§1.44.Transportation Docketing and Transportation Notice of Hearing for Nonrulemaking Proceedings.

§1.45.Notice of Hearing in Nonrulemaking Proceedings.

§1.46.Notice by Publication in Oil and Gas and Surface Mining and Reclamation Nonrulemaking Proceedings.

§1.47.Show Cause Proceedings.

§1.48.Service in Protested Contested Cases.

§1.49.Service of Process; Notice of Hearing; Default; and Motions for Rehearing in Oil and Gas Contested Cases Brought by the Legal Enforcement Section.

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 February 28, 2017.

TRD-201700792

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER D. PARTIES AND INTERVENTION

16 TAC §§1.61 - 1.65

The Commission proposes the repeals under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.61.Classification and Alignment of Parties.

§1.62.Parties Defined.

§1.63.Notice of Protest in Nonrulemaking Proceedings.

§1.64.Intervention.

§1.65.Representative Appearances.

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 February 28, 2017.

TRD-201700793

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER E. DISCOVERY

16 TAC §§1.81 - 1.87

The Commission proposes the repeals under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.81.Forms and Scope of Discovery in Protested Contested Cases.

§1.82.Service and Filing of Discovery Requests and Responses.

§1.83.Deadlines for Responses to Discovery Requests.

§1.84.Requests for Admission.

§1.85.Discovery Orders.

§1.86.Alignment of Municipal Intervenors for Purposes of Discovery.

§1.87.Limitations on Discovery Requests.

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 February 28, 2017.

TRD-201700794

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER F. EVIDENCE IN CONTESTED CASES

16 TAC §§1.101 - 1.108

The Commission proposes the repeals under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.101.Rules of Evidence.

§1.102.Official Notice.

§1.103.Witnesses To Be Sworn.

§1.104.Documentary Evidence.

§1.105.Written Testimony.

§1.106.Exhibits.

§1.107.Formal Exceptions Not Required.

§1.108.Offers of Proof.

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 February 28, 2017.

TRD-201700795

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER G. HEARINGS

16 TAC §§1.121 - 1.130

The Commission proposes the repeals under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.121.Presiding Officer.

§1.122.Prehearing Conferences.

§1.123.Stipulations.

§1.124.Continuances.

§1.125.Consolidation and Joint Hearings.

§1.126.Dismissal.

§1.127.Place and Nature of Hearings.

§1.128.Hearing Procedures.

§1.129.Reporters and Transcripts.

§1.130.Telephonic Proceedings.

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 February 28, 2017.

TRD-201700796

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER H. DECISION

16 TAC §§1.141 - 1.152

The Commission proposes the repeals under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.141.Proposals for Decision.

§1.142.Filing of Exceptions and Replies.

§1.143.Commission Action.

§1.144.Oral Argument before the Commission.

§1.145.Interim Orders.

§1.146.Final Decisions and Orders.

§1.147.Effective Date.

§1.148.Permit Decision Time Period Reviews.

§1.149.Rehearing.

§1.150.Effect of Order Granting Rehearing.

§1.151.Administrative Finality.

§1.152.Administrative Record.

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 February 28, 2017.

TRD-201700797

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER A. DEFINITIONS AND GENERAL PROVISIONS

16 TAC §§1.1 - 1.10

The Commission proposes the new rules under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.1.Purpose, Scope, and Conflict with Other Rules.

(a) This chapter establishes a system for practice and procedure before the Railroad Commission of Texas to enable the just disposition of proceedings and public participation in contested case proceedings pursuant to the Administrative Procedure Act, Texas Government Code, Chapter 2001.

(b) This chapter governs the institution, conduct, and determination of Commission proceedings required or permitted by law, whether instituted by order of the Commission or by filing an application, complaint, petition, or other pleading. This chapter does not and shall not be construed to enlarge, diminish, modify, or otherwise alter the jurisdiction, powers, or authority of the Commission or the substantive rights of any person or agency.

(c) This chapter sets forth the general rules of practice and procedure for proceedings before the Commission. If a general provision of these rules conflicts with a statutory or other special provision governing the same proceeding, and the conflict is irreconcilable, then the special provision controls.

§1.2.Definitions.

The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise.

(1) Agency--A board, commission, department, or other entity created under Texas law that has statewide jurisdiction and makes rules or determines contested cases, other than an agency wholly funded by federal appropriations, the legislature, the courts, and institutions of higher education.

(2) APA--The Administrative Procedure Act, Texas Government Code, Chapter 2001, as it may be amended.

(3) Applicant--A person who by written application, including appeals, seeks a remedy from the Commission.

(4) Authorized representative--The individual designated in writing as representing any person or party before the Commission pursuant to these rules, including an attorney authorized to practice law in the State of Texas.

(5) Business day--A calendar day that is not a Saturday, Sunday, or official state or federal holiday.

(6) Commission--The Railroad Commission of Texas acting through a majority of the Commissioners or through a Commission employee to whom the Commissioners have delegated authority.

(7) Commissioner--One of the elected or appointed members of the Railroad Commission of Texas.

(8) Complainant--A person who files a complaint with the Commission as specified in §1.23 of this title (relating to Complaint Proceedings), regarding an act or omission of the Commission or a person subject to the Commission's jurisdiction.

(9) Contested case--A proceeding in which the legal rights, duties, or privileges of a party are to be determined by the Commission pursuant to the APA after an opportunity for adjudicative hearing, as specified in Subchapter G of this chapter (relating to Hearings).

(10) Director--The individual appointed by the Commission who is in charge of a division or section within the Commission. Subject to Commission directive or other Commission rules, a director may delegate the director's authority to another Commission employee.

(11) Division--An operating or administrative unit of the Commission.

(12) Docket--To assign a docket number to and create a file for a contested case.

(13) Docket number--A reference number assigned by the appropriate division or the Hearings Division to a contested case and used to identify that case.

(14) Docket Services Section--The section within the Hearings Division, under the supervision of the Hearings Director, that administers docketed cases pursuant to this chapter.

(15) Examiner or hearings examiner--An individual appointed by the Commission to conduct hearings, including an administrative law judge, a technical examiner, and other designated employees of the Commission.

(16) Final order--The Commission's final written disposition of a contested case, whether affirmative, negative, injunctive, or declaratory.

(17) Hearings Division--The division responsible for scheduling, conducting, and preparing recommendations on hearings concerning matters within the Commission's jurisdiction.

(18) Intervenor--A person, other than an applicant, complainant, petitioner, protestant, or respondent, who is admitted as a party to a contested case pursuant to §1.37 of this title (relating to Intervention).

(19) License--The whole or a part of a permit, certificate, approval, registration, or similar form of permission issued or granted by the Commission.

(20) Office of General Counsel--The division responsible for providing legal advice to the Commission, comprising the Enforcement Section and the General Counsel Section.

(21) Party--A person named or admitted as an applicant, complainant, petitioner, intervenor, protestant, or respondent in a contested case before the Commission.

(22) Person--An individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, government, governmental subdivision, agency, instrumentality, public corporation, or any other legal or commercial entity.

(23) Petitioner--A person who by written petition, including appeals, seeks a remedy from the Commission.

(24) Pleading--A written document submitted in a contested case by a person or authorized representative setting forth allegations of fact, legal arguments, claims, requests for relief, or other matters. Pleadings may take the form of applications, petitions, complaints, protests, exceptions, replies, motions, responses or answers, or other requests for action.

(25) Proceeding--A formal hearing, investigation, inquiry, rulemaking, or other fact-finding or decision-making process.

(26) Protestant--A person opposing an application or petition submitted to the Commission.

(27) Protested contested case--A contested case in which a party appears and contests or opposes the relief sought, including relief sought in applications, petitions, show-cause proceedings, or complaints.

(28) Register--The Texas Register established by Acts of 1975, 64th Legislature, codified in Texas Government Code, Chapter 2002.

(29) Respondent--A person against whom any complaint has been filed, who is under formal investigation by the Commission, or who is the subject of a show-cause proceeding.

(30) Rule--A Commission statement of general applicability that implements, interprets, or prescribes law or policy, or that describes the Commission's procedure or practice requirements. The term includes a newly adopted rule and the amendment or repeal of an existing a rule but does not include statements concerning only the internal management or organization of the Commission and not affecting private rights or procedures.

(31) Rulemaking--The process to adopt a new rule or to amend or repeal an existing rule pursuant to Texas law.

(32) Show-cause proceeding--A formal opportunity for a respondent to present evidence challenging allegations made against the respondent or to oppose a proposed action concerning the respondent.

(33) Telephony--Includes conventional telephonic communication, Voice over Internet Protocol (VoIP) communication, and all forms of digital audio and audio/video tele-conferencing.

§1.3.Exceptions and Suspension of Rules.

(a) The Commission, the Hearings Director, or the examiner may grant exceptions to the provisions of this chapter upon a showing of good cause and if necessary in the interest of justice.

(b) The Commission may suspend the operation of one or more of its general or special rules of practice and procedure if it finds that there exists a public emergency or imperative public necessity.

(c) The Commission may waive any fee established by one or more of its general or special rules of practice and procedure for good cause shown, except those fees required by statute.

§1.4.Violation of Procedural Rules.

In addition to any other penalties authorized by law or by Commission rule, the violation of any general or special rule of practice and procedure shall be sufficient cause for the Commissioners, after notice and hearing, to enter an order holding the offender in contempt or subjecting the offender to just, reasonable, and lawful disciplinary action.

§1.5.Conduct and Decorum.

Parties, authorized representatives, witnesses, and other participants in Commission proceedings shall conduct themselves with proper dignity, courtesy, civility, and respect for the Commission, the director, the examiner, and all other participants. Disorderly conduct will not be tolerated. A violator of this rule may be excluded from the proceeding by the examiner for such period as is just and may be subject to such other just, reasonable, and lawful disciplinary action as the Commission may prescribe.

§1.6.Recording and Broadcasting of Hearings.

Coverage of a hearing through broadcasting, televising, recording, live-streaming, or photographing is permitted upon prior approval of the Hearings Director. The request for approval shall specify the type of coverage to be conducted at the hearing. Requests may be denied or approved with restrictions if the Hearings Director finds coverage will unduly distract participants, interfere with the hearings process, or impair the dignity of the hearing.

§1.7.Ex Parte Communications.

(a) Ex parte communications are prohibited in contested cases as provided in the APA and other applicable rules including the Texas Disciplinary Rules of Professional Conduct.

(b) Each party shall provide all other parties with a copy of all documents submitted to an examiner.

(1) The attachment of a certificate of service stating that a document was served on a party creates a rebuttable presumption that the named party was provided a copy.

(2) Failure to provide a copy to all other parties may result in rejection and return of the document without consideration.

§1.8.Testimony under Oath or Affirmation.

Testimony in all contested cases shall be presented under oath or affirmation administered by an examiner, Commissioner, or court reporter.

§1.9.Computation and Extensions of Time in Contested Cases.

(a) In computing any period of time prescribed or permitted by the Hearings Director, the examiner, a rule or an order of the Commission, or any applicable statute:

(1) the day of the act, event, or default from which the period of time begins to run shall not be included;

(2) the last day of the period being computed shall be included, unless it is a Saturday, Sunday, weekday on which the Commission has officially closed prior to 5 p.m. due to weather or other exigency, or an official state or federal holiday, in which event the period shall continue to run until 5 p.m. on the next business day except as otherwise provided by statute; and

(3) Saturdays, Sundays, and official state or federal holidays shall not be counted for any purpose in any time period of five days or less in these rules.

(b) Unless otherwise provided by statute or special rule, the time for filing any pleading or other document may be extended upon the granting of a motion for extension of time. The motion shall:

(1) be filed with the Docket Services Section prior to the applicable deadline;

(2) show that there is good cause for an extension of time and that the need for the extension is not caused by the negligence, indifference, or lack of diligence of the person, party, or authorized representative filing the motion; and

(3) be served in accordance with §1.45 of this title (relating to Service in Protested Contested Cases).

§1.10.Commissioner Private Interest in Decision.

(a) A Commissioner with a personal or private interest in a measure, proposal or decision pending before the Commission shall publicly disclose the fact to the Commission in an open meeting. The Commissioner may not vote or otherwise participate in the decision. The disclosure shall be entered in the minutes of the meeting.

(b) In this section, "personal or private interest" has the same meaning as is given to it under Texas Government Code, §572.058.

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 February 28, 2017.

TRD-201700798

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER B. INITIATION OF CONTESTED CASE PROCEEDING

16 TAC §§1.21 - 1.27

The Commission proposes the new rules under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.21.Filings with Commission Division Directors.

(a) All applications, petitions, complaints, and other documents relating to any proceeding to be initiated before the Commission shall be filed with the appropriate division director in accordance with that division's filing requirements and any applicable statute or regulation. Such documents, including notices of protest and answers, shall be presumed filed on the date they are actually received only if accompanied by any required filing fee. The Commission may decline to accept a document for filing if it does not comply with applicable requirements.

(b) If an application, petition, complaint, or other document requires further consideration after division processing but prior to final Commission action, the division shall transfer the matter to the Hearings Division.

§1.22.Filings with the Hearings Division.

(a) Once a party has notice that a division has transferred a contested case to the Hearings Division, the party shall file all subsequent pleadings and other documents related to the case with the Docket Services Section.

(b) Pleadings and related documents filed with the Hearings Division shall be deemed filed only when they are actually received by the Docket Services Section and are accompanied by any required filing fee. The time and date of filing shall be determined by the file stamp affixed on the pleading or related document by the Docket Services Section.

(c) Except as provided in subsection (e) of this section, pleadings shall be filed as follows:

(1) If the pleading contains 10 or fewer pages including exhibits, it may be filed by fax, email, or other approved electronic transmission with the Docket Services Section. If a party or authorized representative elects to file a pleading by email, the party or authorized representative agrees to be served by email and affirmatively consents to the release and disclosure of the email address.

(2) Pleadings longer than 10 pages shall be filed in hard copy with the Docket Services Section, unless the examiner or Hearings director informs the parties in writing that they may file all documents pursuant to paragraph (1) of this subsection.

(d) Unless the examiner sets the filing deadline at a time earlier than 5 p.m., pleadings and related documents shall be considered timely filed if received and file stamped by the Docket Services Section on or before 5 p.m. of the filing deadline. Pleadings filed after 5 p.m. local time of the Commission shall be deemed filed the following business day. Pleadings filed by fax, email, or other approved electronic transmission shall be considered filed at or before 5 p.m. local time if the complete pleading is received at or before 5 p.m. local time. If the examiner sets the filing deadline at a time earlier than 5 p.m., pleadings and related documents shall be considered filed at the time indicated by the file stamp.

(e) Exceptions and replies, and motions for rehearing and replies to motions for rehearing shall be filed pursuant to §1.122 of this title (relating to Filing of Exceptions and Replies) and §1.128 of this title (relating to Motions for Rehearing), respectively.

(f) The Hearings Division may decline to accept a transferred case, docket a case, accept a filing, or set a hearing in instances where there has been a failure to substantially conform to the rules in this chapter.

§1.23.Complaint Proceedings.

(a) Filing of complaint. Complaints relating to matters within the Commission's jurisdiction shall be in writing and contain a detailed description of the allegations against the respondent. The complainant shall serve the complaint on the respondent and simultaneously file it with the applicable division of the Commission. The division receiving the complaint shall transfer it to the Hearings Division. If the complainant amends the complaint, the complainant shall serve the amended complaint on the respondent and simultaneously file it with the Docket Services Section.

(b) Burden of proof. The complainant in a complaint proceeding shall have the burden of proof which is a preponderance of the evidence. In the interest of justice, the examiner may modify the burden of proof pursuant to §1.110 of this title (relating to Burden of Proof).

(c) Notice of complaint. When a complaint is filed, the Commission shall forward the complaint to the respondent and attach a letter stating:

(1) the respondent has 20 days from the date of the letter to either file an answer or request a hearing to contest the allegations of the original complaint; and

(2) that a default order may be entered against the respondent if the respondent fails to answer, request a hearing, or appear at the hearing, if a hearing is requested.

(d) Respondent's answer.

(1) The respondent shall answer the complaint in writing, by either specifically denying the material allegations of the complaint or alleging an affirmative defense. Alternatively, the respondent may request a hearing which shall serve as a general denial of the allegations in the original complaint.

(2) If the complaint is thereafter amended, the time period for the filing and service of the answer shall, unless otherwise ordered, run from the service of such amended complaint. The original answer shall be considered as the answer to the amended complaint unless a new answer is filed in response to the amended complaint.

(e) Default order. If the respondent fails to answer, request a hearing, or appear at the hearing, the examiner may find the respondent to be in default and prepare a default final order to be presented to the Commission without further notice.

(f) Dismissal for lack of jurisdiction of Commission or standing of complainant.

(1) If the Commission finds, either on the face of the complaint or after motion of the respondent, that the Commission lacks jurisdiction or the complainant lacks standing, the Hearings Director or the Commissioners shall dismiss the complaint as to such allegation or complainant.

(2) Any dismissal order entered by the Hearings Director is subject to review by an appeal to the Commissioners. The appeal shall follow the same requirements set forth in §1.38(e) of this title (relating to Interim Rulings and Appeals of Interim Rulings).

§1.24.Show-Cause Proceedings.

(a) In response to a written complaint or on the Commission's own motion, the Commission or the Hearings Director may issue a notice commanding a person subject to the Commission's jurisdiction to appear at a public hearing and show cause why the person should not be compelled to do the act required, or refrain from doing an act, or why the Commission should not take the proposed action.

(b) The respondent in a show-cause proceeding shall have the burden of proof which is a preponderance of the evidence.

(c) On the respondent's failure to appear at the hearing or meet its burden of proof, the respondent may be compelled to do the act required or to refrain from doing an act, or the Commission may take the proposed action.

§1.25.Contested Cases Brought by the Enforcement Section.

(a) Commencement of a contested case.

(1) Enforcement contested cases are commenced when a division of the Commission refers the matter to the Enforcement Section of the Office of General Counsel and the Enforcement Section assigns a docket number to the case. Before filing a complaint, the Commission may offer to settle the case through an agreed order.

(2) If the Commission does not offer to settle, or the terms of the offer are not timely met by the respondent, the Commission will send the original complaint to the respondent by certified and regular first-class mail. In cases against foreign or non-resident respondents, the complaint will also be sent to the resident agent listed on the respondent's most recently filed Organization Report (Form P-5). The complaint will be accompanied by a letter alleging that the respondent has violated Commission rules or statutes as set forth in the original complaint; that the respondent may, within 30 days of the date of service, file an answer or request a hearing to contest the allegations of the original complaint; and that the respondent may wish to hire an attorney or other authorized representative or choose to appear on its own behalf. The letter will notify the respondent that if, on 31st day after the date of service, it has not entered into an agreed order, filed an answer to the original complaint, or requested a hearing, a default final order may thereafter be issued against respondent without further notice. Concurrent with the complaint, the Commission may make an offer to settle the case through an agreed order.

(3) When there is actual pollution or injury to the public health and safety, or an imminent threat thereof, a hearing may be set and notice of the hearing sent with the original complaint. The notice will state that if the respondent fails to appear at the hearing, a default final order may be issued against respondent without further notice as specified in subsection (d) of this section.

(b) Filing of answer or request for hearing; setting of hearing. A request for hearing made by the respondent shall serve as a general denial of the allegations in the original complaint. An answer or request for hearing is timely if filed with the Docket Services Section before the matter is included on an open meeting agenda of the Commission that has been posted with the Secretary of State. Except in cases brought under subsection (a)(3) of this section, the Enforcement Section will coordinate with the Docket Services Section to set a hearing on a date at least 30 days after receipt of a timely answer or hearing request, unless the case is disposed of by other means.

(c) Notice of hearing. Notices of hearing will be sent along with the original complaint to respondents or their authorized representatives in all cases brought under subsection (a)(3) of this section. In all other cases, notices of hearing will be sent, along with a current Enforcement Section pleading, only after the respondent or its authorized representative has timely filed a request for hearing or an answer. The notice will be sent to the address from which the request or answer was received, and will state that if the respondent fails to appear at the hearing, a default final order may be issued against respondent without further notice as specified in subsection (d) of this section.

(d) Default order upon failure to answer, request hearing, or appear at hearing.

(1) If the respondent fails to timely answer the original complaint, request a hearing, or appear at a scheduled hearing, a default final order may be issued by the Commission without further notice.

(2) Default final orders will contain findings of fact and conclusions of law sufficient to support the relief ordered.

(3) No default final order shall be issued until the Commission has access to the proof of service of the original complaint or the notice of hearing, or the returned certified mail containing the complaint or the notice, has been on file with the Commission for 15 days, exclusive of the day of receipt and day of issuance. Default final orders need not be individually signed in each case by the Commissioners if the case is listed by docket number and summarized on a Master Default Order.

(e) Non-applicability of this section to emergency situations. The existing power of the Commission to remedy and seek reimbursement for remediation of any condition which threatens the public health and safety, or to order an operator to remedy said condition, shall not be affected by this section.

(f) When the Enforcement Section alleges a violation of Texas Natural Resources Code, §91.143, relating to false information filed with the Commission, if the records that are subject of the proceeding are incorrect, there is a presumption that the respondent filed the record knowing it to be incorrect. The presumption may be rebutted by competent evidence.

§1.26.Classification and Alignment of Parties.

(a) Parties to contested cases before the Commission are defined in §1.2 of this title (relating to Definitions). If there is an error in a party's designation in its pleadings, the examiner may assign a party an appropriate designation.

(b) The examiner may align parties according to the nature of the proceeding.

§1.27.Parties and Authorized Representatives.

(a) Any party may appear individually or through an authorized representative.

(b) Authorized representatives shall:

(1) file a notice of representation with the Docket Services Section that contains the representative's mailing address, telephone number, and, if applicable, fax number and email address;

(2) advise their clients and witnesses of applicable requirements of conduct and decorum;

(3) comply with §1.7 of this title (relating to Ex Parte Communications).

(c) If an authorized representative's authority is challenged, the authorized representative must file documents that evidence authority to appear as the party's representative.

(d) An authorized representative seeking to withdraw shall file a motion to withdraw and shall provide in the motion a mailing address, telephone number, and, if applicable, fax number and email address for the party or substitute representative. A party's authorized representative shall remain as such until the motion to withdraw is granted by the examiner.

(e) If an authorized representative includes an email address in the notice of representation, the authorized representative agrees to be served by email and affirmatively consents to the release and disclosure of the email address.

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 February 28, 2017.

TRD-201700799

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER C. PLEADINGS, MOTIONS, AND OTHER DOCUMENTS

16 TAC §§1.31 - 1.38

The Commission proposes the new rules under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.31.Classification of Pleadings.

(a) Pleadings filed in contested case proceedings before the Commission shall be designated as one of the following: application, petition, complaint, notice of protest, answer, motion, exception, or response or reply to one of the preceding pleadings. If there is an error in the designation of a pleading, the examiner or the Hearings Director may determine the appropriate status in the proceeding and treat it accordingly.

(b) Requests for discovery and responses thereto shall not be classified as pleadings and shall become a part of the administrative record in a contested case only when offered as evidence, or when part of a request for an order compelling a discovery response, or a reply thereto.

(c) Pleadings shall be liberally construed. As applicable, the Commission, Hearings Director, or examiner may construe a document as a pleading if the intent of the filing or document is evident.

§1.32.Form and Content of Pleadings.

(a) Unless otherwise permitted or required by Commission rules or by statute, a pleading shall contain a statement of the pleading's objectives, a concise statement of supporting facts, and a specific request for relief.

(b) Pleadings that are filed in hard copy shall be printed on white paper that is 8 1/2 inches wide and 11 inches long, with at least one-inch margins, or on the appropriate Commission form. The text shall only be on one side of the paper and shall be double or one and one-half spaced, except that footnotes and lengthy quotations may be single spaced. Exhibits attached to a pleading shall be the same size as pleadings or folded to that size.

(c) Each pleading shall be signed by the party or its authorized representative. When a copy of the signed document has been filed, the party or its authorized representative shall maintain the original document for examination by the Commission , the examiner, the Hearings or appropriate division director, or any party to the proceedings, should a question arise as to its authenticity.

(d) A pleading shall contain:

(1) the filing party's business address, telephone number, and, if applicable, fax number or email address, or if filed by its authorized representative, the authorized representative's business address, telephone number, and, if applicable, the authorized representative's Texas state bar number, email address, and fax number; and

(2) a certification pursuant to §1.45 of this title (relating to Service in Protested Contested Cases).

(e) If a party or authorized representative includes its email address or fax number in a pleading, the party consents to be served by email or fax and affirmatively consents to the release and disclosure of the email address.

§1.33.Correction of Pleadings.

If the appropriate director or examiner finds that a pleading does not substantially comply in all material respects with the Commission's rules, notice of the deficiency or deficiencies will be provided to the filing party. Unless precluded by operation of law, the party who filed the pleading shall thereafter have the right to file a corrected pleading. The filing of a corrected pleading shall not be permitted to delay any proceeding unless the appropriate director or the examiner determines based on evidence submitted by the filing party that such delay is necessary to prevent an injustice or to protect the public interest.

§1.34.Amended or Supplemental Pleadings.

(a) Pleadings may be amended or supplemented when permitted by statute or when justice so requires.

(b) Unless the Commission, the Hearings Director, or the examiner approves and issues additional notice as required by law, an application, petition, or complaint, upon which original notice of hearing has been issued, may not be amended so as to broaden or enlarge the scope thereof.

§1.35.Responsive Pleadings and Emergency Action.

(a) Any responsive pleading shall be filed by a party within 10 days after filing of the pleading to which the response is made or as ordered by the examiner.

(b) A responsive pleading to a complaint filed under this chapter shall be filed by the respondent within 20 days of the date of the Commission's letter notifying the respondent of the complaint.

(c) The Commissioners, the Hearings Director, or the examiner may take action on a pleading before the deadline for filing responsive pleadings only in an emergency that presents a risk of imminent pollution, waste, or injury to persons or real or personal property. Action taken under such conditions is subject to modification based on a timely responsive pleading.

§1.36.Motions.

(a) A motion shall be filed with the Docket Services Section, unless dictated into the record during the pendency of a hearing, and shall state the relief sought and the specific reasons for the motion. If the motion is based upon alleged facts that are not a matter of record, it may, in the examiner's discretion, be supported by an affidavit. Motions shall be served in accordance with §1.45 of this title (relating to Service in Protested Contested Cases). Notice of action on any motion shall be served promptly on all parties.

(b) A motion is timely filed if filed with the Docket Services Section before the contested case is included on an open meeting agenda of the Commission that has been posted with the Secretary of State.

§1.37.Intervention.

(a) Any person who has a justiciable or administratively cognizable interest and who is not an applicant, petitioner, complainant, respondent, or protestant and who desires to be designated as a party in any contested case before the Commission may file a petition for leave to intervene no later than five days prior to the hearing date.

(b) The examiner or the Hearings Director shall promptly act on all petitions for leave to intervene. All interventions shall be subject to a motion to strike for having been improperly admitted.

§1.38.Interim Rulings and Appeals of Interim Rulings.

(a) Relief through interim ruling. Prior to presentation of a contested case to the Commission at an open meeting, a party may seek, through an examiner, or Hearings Director, as appropriate, relief through interim ruling, but that ruling shall not be considered of the same nature as a final decision. An interim ruling shall not be subject to exceptions or motions for rehearing. For purposes of this section, the term interim ruling includes orders issued pursuant to §1.55 of this title (relating to Discovery Orders) and final actions taken by Commission staff to deny an application or other requested relief for which no other avenue of appeal is provided by Commission rules.

(b) Evidentiary rulings. An evidentiary ruling by an examiner is not an interim ruling and is not appealable to the Commission pending the issuance by the examiner of a proposal for decision. Such rulings include, but are not limited to, reopening the record of a hearing for additional evidence, before a proposal for decision is issued.

(c) Interim ruling to suspend license.

(1) In this section, "license" includes the whole or a part of a Commission permit, certificate, approval, registration, or similar form of permission required by law.

(2) When an interim ruling suspends a license because an imminent peril to the public health, safety, or welfare requires emergency action, the examiner or Hearings Director shall incorporate a factual and legal basis establishing that imminent peril in the interim ruling.

(3) Unless expressly provided otherwise by statute, the Commission shall initiate the proceedings for revocation of the license or other action not later than the 30th day after the interim ruling is signed.

(d) Appeal of interim ruling.

(1) Except as provided in paragraph (2) of this subsection, any party aggrieved by an interim ruling may appeal that ruling to the Commission and seek a stay if the party files a written appeal within 10 days of the date the interim ruling is signed or stated in the record. Untimely appeals shall not be forwarded by examiners to the Commissioners, pursuant to subsection (e) of this section. If, by the 46th day after the date the interim ruling is signed or stated in the record, the Commission has not signed a written order ruling on the appeal, then the appeal shall be deemed denied and any granted stay is lifted.

(2) In all gas utility proceedings brought or conducted under Texas Utilities Code, Chapters 102, 103, 104, and 121, any party aggrieved by an interim ruling may appeal that ruling to the Commission and seek a stay if the party files a written appeal within five days of the date the interim ruling is signed or stated in the record. Untimely appeals shall not be forwarded by examiners to the Commissioners, pursuant to subsection (e) of this section. If, by the 20th day after the date the interim ruling is signed or stated in the record, the Commission has not signed a written order ruling on the appeal, then the appeal shall be deemed denied and any granted stay is lifted.

(3) In all proceedings, the appealing party shall serve the appeal in accordance with §1.45 of this title (relating to Service in Protested Contested Cases) on the same day the appeal is filed with the Docket Services Section.

(4) Any response to an appeal must be filed with the Docket Services Section and served in accordance with §1.45 of this title within 10 days of the date the appeal of the interim ruling was filed.

(5) Pending action on the appeal of the interim ruling, the Hearings Director or the examiner may issue a stay of the interim ruling.

(e) Procedure on appeal. The Commissioners may consider and rule on an appeal on or after the day following the day the response to the appeal is due. An order on an appeal from an interim ruling shall not be subject to motions for rehearing pending issuance of the proposal for decision and signing of the final order. Any issue in an appeal that has been deemed denied by operation of law may be raised again in exceptions to the proposal for decision. When a timely appeal is filed under this section, the examiner shall:

(1) forward to each Commissioner a copy of the appeal along with a cover memorandum showing the date the appeal was filed, the date replies are due, and the date on which the appeal will be deemed denied if no Commission action is taken;

(2) forward to each Commissioner a copy of all replies to appeals of interim rulings which may be filed, and of any stay of the interim ruling granted by the Hearings Director; and

(3) upon the request of any one Commissioner, immediately schedule the appeal for consideration by the Commission at an open meeting, and cause proper notice to be given to all parties.

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 February 28, 2017.

TRD-201700800

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER D. NOTICE AND SERVICE

16 TAC §§1.41 - 1.45

The Commission proposes the new rules under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.41.Notice of Application in Contested Cases.

Notice of application for contested cases shall be given in accordance with applicable law, rule, or order of the Commission.

§1.42.Notice of Hearing.

(a) In a contested case, each party is entitled to an opportunity:

(1) for hearing after reasonable notice of not less than 10 days; and

(2) to respond and to present evidence and argument on each issue involved in the case.

(b) Each notice of hearing shall include the following:

(1) a statement of the time, place, and nature of the hearing;

(2) a statement of the legal authority and jurisdiction under which the hearing is to be held;

(3) a reference to the particular sections of the statutes and rules involved;

(4) a short, plain statement of the factual matters asserted; and

(5) any other statements required by law or directed by the Commission.

(c) If the Commission or a party is unable to state the factual matters in detail at the time the notice is served, the initial notice may be limited to a statement of the issues involved. On timely written application, a more definite and detailed statement of the facts shall be submitted in writing to the Hearings Division, which shall issue an amended notice not less than seven days prior to the date set for the hearing.

(d) In a proceeding in which the Commission has the burden of proof, if the Commission intends to rely on a section of a statute or rule not previously referenced in the notice of hearing, the Hearings Division shall amend the notice to refer to the section of the statute or rule not less than seven days before the date set for the hearing. This subsection does not prohibit the Commission from filing an amended notice of hearing after the hearing has commenced. If the Commission files an amended notice of hearing after the hearing has commenced, the examiner shall grant a continuance of at least seven days at the request of any other party.

§1.43.Notice by Publication.

(a) When an applicant in a proceeding is unable, after due diligence, to identify the address of any person who is required to be notified of an application, complaint, or hearing, the applicant must publish notice of the application, complaint, or hearing.

(1) Unless otherwise directed by the appropriate director or examiner, the applicant shall publish the Commission's notice of application or notice of hearing in a newspaper of general circulation in the county or counties where the land or facility that is the subject of the application or hearing is located. The applicant shall publish such notice once per week for four consecutive weeks. The first publication shall be published at least 28 days before the protest deadline in a notice of application or the hearing date in a notice of hearing.

(2) The applicant must file proof of publication in the form of a publisher's affidavit or present at a hearing a copy of the newspaper notice along with testimony by a person with personal knowledge of the publication details.

(b) In determining whether notice by publication is appropriate, the examiner may consider whether an applicant used due diligence in attempting to identify the address of any person who is required to be notified of an application, complaint, or hearing.

§1.44.Notice of Protest.

A notice of protest may be filed when the notice of application, notice of hearing, or a Commission rule sets forth the requirements for filing such notice, or as provided by order of the Commission instituting the proceeding.

§1.45.Service in Protested Contested Cases.

(a) Service requirements. A copy of any pleading or document filed in a protested contested case shall be served by a party as follows:

(1) On the same day a party files a document with the Commission, the party shall serve a copy on every other party and any other person required by the Hearings Division. If a party is represented by an authorized representative, service shall be made on that representative; and

(2) All filings shall include a certificate of service that copies have been served on all persons described in paragraph (1) of this subsection. The certificate of service shall include the date and manner of service and the names and addresses of all persons served. If a person is served by fax or email, the certificate of service shall include the person's fax number or email, as applicable.

(b) Methods of service.

(1) A pleading or document may be served by hand delivering a copy to the person to be served, or by first class, certified, or registered mail, commercial delivery service, fax, email, or by such other manner as the Commission may require.

(A) Service by mail or commercial delivery service shall be complete upon deposit of the document postpaid and properly addressed to the person's last known address with the United States Postal Service or a commercial delivery service.

(B) Service by fax shall be sent to the person's current fax number and is complete on the date of the fax. Fax transmissions completed after 5 p.m. local time of the recipient shall be deemed served on the following business day.

(C) Personal service may be effectuated by hand delivering a copy to the person to be served and is complete on the date of delivery. Personal service completed after 5 p.m. local time of the recipient shall be deemed served on the following business day.

(D) Service by email may be used if the person to be served consents to be served by email pursuant to §1.27 or §1.32 of this title (relating to Parties and Authorized Representatives, and Form and Content of Pleadings, respectively). If the person consents to be served by email, the person affirmatively consents to the release and disclosure of the email address. Email service is complete on the date of the email transmission. An email received after 5 p.m. local time of the recipient shall be deemed served on the following business day.

(2) Proof of service. The filing party or authorized representative shall certify compliance with this rule in writing over signature and on the filed instrument. A certificate showing service shall be prima facie evidence of the fact of service. In cases of personal service, the certificate shall state when the pleading or motion was served and the manner of service. The recitations in the certificate are prima facie evidence of the facts cited in the certificate.

(c) Service by mail or commercial delivery service. Unless otherwise directed by the examiner or Hearings Director, when a party is required to do some act within a prescribed time period following service of a pleading, motion, or discovery document described in §1.51 of this title (relating to Forms and Scope of Discovery in Contested Cases) and the pleading, motion, or discovery document is served by mail or commercial delivery service, three days shall be added to the prescribed response period.

(d) Failure to serve. The serving party has the burden of proving the date and time of service. The failure of a party to serve a pleading or filed document on another party or person as required by this section may be sufficient grounds for the Hearings Director or the examiner to strike the pleading or filed document, or to take other appropriate action. A party may offer evidence or testimony that a notice or document was not received, or if service was by mail, that it was not received within three days from the date of mailing, and upon so finding, the examiner or Hearings Director may extend the time for taking the action required of the party or grant other appropriate relief.

(e) Service by the Commission.

(1) For documents served on a party with an active or delinquent organization report on file pursuant to §3.1 of this title (relating to Organization Report; Retention of Records; Notice Requirements), the Commission shall serve documents by:

(A) first class mail to the address shown on the most recently filed organization report or the most recently filed letter notification of change of address, in which case the document is presumed received if the document is not returned to the Commission;

(B) certified mail to the address described in subparagraph (A) of this paragraph, in which case service is effective upon:

(i) acceptance of the item by any person at the address;

(ii) initial failure to claim or refusal to accept the item by any person at the address prior to its eventual return to the Commission by the United States Postal Service; or

(iii) return of the item to the Commission by the United States Postal Service bearing a notation such as "addressee unknown," "no forwarding address," "forwarding order expired," or any similar notation indicating that the organization's mailing address shown on the most recently filed organization report or address change notification letter is incorrect; or

(C) personal service or registered or certified mail to the address described in subparagraph (A) of this paragraph for revocation, suspension, annulment, or withdrawal of a license.

(2) For documents served on all other parties, unless otherwise required by law, the Commission shall serve documents in accordance with subsection (b) of this section.

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 February 28, 2017.

TRD-201700801

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER E. DISCOVERY

16 TAC §§1.51 - 1.57

The Commission proposes the new rules under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.51.Forms and Scope of Discovery in Protested Contested Cases.

(a) Permissible forms of discovery by parties are:

(1) oral depositions of a party or a nonparty;

(2) written interrogatories to a party;

(3) requests to a party for admission of facts or the genuineness or identity of documents or things;

(4) requests to a party for production, examination, and copying of documents or other tangible materials;

(5) requests to a party for entry upon and examination of real or personal property, or both; and

(6) requests to a party for disclosures pursuant to Texas Rule of Civil Procedure 194.

(b) The scope of discovery shall be the same as provided by the Texas Rules of Civil Procedure and shall be subject to the constraints provided therein for privileges, objections, protective orders, and duty to supplement as well as the constraints provided in the APA.

§1.52.Service and Filing of Discovery Requests and Responses.

(a) Requests for discovery and responses shall be served using a method of service authorized by §1.45 of this title (relating to Service in Protested Contested Cases) and should not be filed with the Commission.

(b) If the parties disagree on the scheduling or scope of the deposition, a deposition request and proposed deposition discovery order shall be filed with the Docket Services Section and the examiner will set the matter for consideration at a prehearing conference.

(c) The deposition shall be returned to the Commission as provided in the APA, §2001.100.

(d) Except for good cause shown, all requests for discovery shall be served at least 20 days prior to the hearing unless otherwise agreed by the parties.

§1.53.Deadlines for Responses to Discovery Requests.

Responses to discovery requests shall be served within 14 days after the date of the request. The examiner or the Hearings Director may alter this deadline on the request of any party.

§1.54.Requests for Admission.

Except as otherwise provided in §1.53 of this title (relating to Deadlines for Responses to Discovery Requests), requests for admission shall be governed by the applicable provisions of the Texas Rules of Civil Procedure. Each matter for which an admission is requested shall be separately stated. If a written answer or objection to a request for admission is not timely served, the request is deemed admitted without necessity of a Commission order. The requests for admission document must clearly set forth this provision for deemed admissions, in bold print or by underlining, in a conspicuous location to fairly inform the responding party of the consequences of a failure to respond within the prescribed time period. The examiner may permit withdrawal or amendment of responses and deemed admissions upon a showing of good cause.

§1.55.Discovery Orders.

(a) Motion to compel. Unless otherwise ordered, a party alleging another party's failure to comply with discovery requests shall file a sworn motion to compel with the Docket Services Section at least 10 days prior to the hearing on the merits. The motion shall certify that the requesting party made a good faith effort to resolve the matter with the non-moving party prior to filing the motion.

(b) Deposition discovery orders. The Hearings Director or the examiner is authorized to issue a subpoena to take a deposition, which shall require that the witness appear and produce, at the time the deposition is taken, books, records, papers, or other objects that may be necessary and proper for the purposes of the proceeding.

(c) Other discovery orders. The Hearings director or the examiner may issue protective orders, orders compelling discovery responses, and orders creating a discovery control plan. Requests for discovery orders shall contain a sworn statement that, after due diligence, the desired information cannot be obtained through informal means, and that good cause exists for requiring discovery. The Hearings Director or the examiner may conduct in camera inspections of materials when requested by a party or when necessary to determine facts required to issue appropriate discovery orders. The request for a discovery order may be denied:

(1) if the request is untimely or unduly burdensome in light of the complexity of the proceeding;

(2) if the requesting party has failed to exercise due diligence;

(3) if the discovery would result in undue cost to the parties or unnecessary delay in the proceeding; or

(4) for other good cause in the interest of justice.

(d) Review by Commissioners. Any discovery order issued by the examiner or the Hearings Director is subject to review by an appeal to the Commissioners. Any party that chooses to appeal a discovery order shall follow the requirements set forth in §1.38 of this title (relating to Interim Rulings and Appeals of Interim Rulings). A discovery order does not constitute a final order or decision.

(e) Compliance. The Commission may enforce compliance with any discovery order or subpoena pursuant to Texas Government Code §§2001.089, 2001.094, and 2001.201, and the Texas Natural Resources Code, §81.053 and §81.064, or as otherwise permitted by law.

§1.56.Alignment of Municipal Intervenors for Purposes of Discovery.

(a) This section applies to proceedings initiated pursuant to Texas Utilities Code, §103.055 and §104.102.

(b) Municipal intervenors, whether participating as a single municipality or a coalition of municipalities, are presumed to share a common interest in a proceeding such that alignment of municipal intervenors as a single party for purposes of discovery is appropriate. The examiner shall order alignment of municipal intervenors at the earliest reasonable opportunity so as to avoid unnecessary duplication of effort and to allow aligned parties an adequate opportunity to coordinate discovery efforts in an efficient manner.

(c) To overcome the presumption of alignment, a municipality or municipal coalition must file a motion to realign in whole or in part. In ruling on such a motion, the presiding officer shall consider whether good cause exists to grant the motion to realign in whole or in part including consideration of the following:

(1) whether the municipal intervenors are taking opposing positions regarding the utility's request for relief;

(2) whether the municipal intervenors have sufficiently different positions on one or more issues to justify realignment on such issues;

(3) whether granting the motion will create unnecessary inefficiencies or duplication of effort;

(4) whether granting the motion will result in undue costs to the parties;

(5) the effect of granting the motion on the parties and the public interest;

(6) whether granting the motion will serve the interest of justice; and

(7) any other relevant factors as determined by the presiding officer.

§1.57.Limitations on Discovery Requests.

(a) This section applies to proceedings brought pursuant to Texas Utilities Code, §103.055 and §104.102.

(b) Upon request by a party, the presiding officer may limit discovery, by order, in the interest of efficiency and justice.

(c) For purposes of calculating the number of requests for information (RFIs), each request or subpart shall be considered a separate RFI. Absent a showing of good cause, a reasonable limitation on RFIs propounded to a party is no more than 600 total RFIs, with no more than 75 RFIs propounded by a single party in one calendar week. Commission staff and presiding officers are not subject to these discovery limitations when Commission staff or the presiding officers issue the RFIs.

(d) With regard to discovery propounded by a municipality or municipal coalition, to the extent that the utility first filed its request for relief at the municipal level and a municipal party has requested that the discovery propounded at the municipal level be updated, and the Commission is now considering the utility's request on appeal from the municipal forum, the number of RFIs (inclusive of subparts) that the municipality propounded at the municipal level shall count towards the total number of permissible RFIs a municipality may serve on the utility during the Commission proceeding on appeal, unless the utility updated its test year when filing its appeal.

(e) If a party is not required to answer a question due to a sustained objection or withdrawal, that question may not be included in the calculation of the propounding party's RFI limit. However, if the presiding officer determines that a party is intentionally propounding frivolous, irrelevant, or otherwise objectionable requests, the question shall be included in the calculation of that propounding party's RFI limit.

(f) As set forth in the Texas Rules of Civil Procedure 196 and 198, there shall be no limitation with regard to requests for production and inspection, or requests for admission.

(g) The party propounding discovery shall separately characterize its discovery as an RFI, a Request for Production and Inspection, or a Request for Admission.

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 February 28, 2017.

TRD-201700802

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER F. EVIDENCE

16 TAC §§1.61 - 1.68

The Commission proposes the new rules under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.61.Rules of Evidence.

The Texas rules of evidence and Texas law with regard to evidence in nonjury civil cases shall apply in contested cases. Irrelevant, immaterial, or unduly repetitious evidence may be excluded. When necessary to ascertain facts not reasonably susceptible of proof under those rules, evidence not admissible thereunder may nevertheless be admitted by the examiner (except where precluded by statute) if it is of a type commonly relied upon by reasonably prudent persons in the conduct of their affairs. The rules of privilege recognized by law shall apply in Commission proceedings. Objections to evidentiary offers may be made and shall be noted in the record.

§1.62.Official Notice.

(a) Facts noticeable. Official notice may be taken of judicially cognizable facts, and notice may be taken of generally recognized facts within the area of the Commission's specialized knowledge.

(b) Motions for official notice and opportunity to respond. A party's motion for official notice must be made or filed prior to the conclusion of the evidentiary hearing. The motion must specify the facts, material, records, or documents encompassed in the motion. A party who opposes the motion shall have the opportunity to contest the requested action.

(c) Notification of materials noticed. The examiner on his or her own motion, or the Commission on its own motion, may propose to take official notice of facts, material, records, or documents authorized by the APA, §2001.090. The parties will be given the opportunity to contest the proposed action and shall be notified of the facts, material, records, or documents officially noticed before, during, or after the hearing by the Commission.

§1.63.Documentary Evidence.

A copy or excerpt of a document may be admitted as evidence if the original is not readily available and if authenticity is established by competent evidence. When numerous or duplicative documents are offered, the examiner may limit those admitted to a number of documents which are typical and representative. The examiner may require the offering party to abstract or summarize relevant data from documents and present the abstracts or summaries in exhibit form. All parties shall have the right to examine the documents abstracted or summarized.

§1.64.Written Testimony.

(a) Admissibility. When a proceeding will be expedited and the interests of the parties will not be substantially prejudiced, direct testimony may be offered in written form. The written testimony of a witness on direct examination, either in narrative or question and answer form, may be offered as an exhibit and incorporated into the record without the written testimony being read. A witness who is offering written testimony shall be sworn and shall identify the written testimony as a true and accurate representation of what the testimony would be if the witness were to testify orally, after which the witness shall submit to voir dire and cross-examination. Written testimony shall be subject to the same evidentiary objections as oral testimony.

(b) Prefiling. The Commission, the Hearings Director, or an examiner may require or permit written testimony and exhibits to be filed and served on all parties at a specified date prior to the hearing. Failure to prefile written testimony and exhibits if required under this section shall be sufficient cause for the examiner to rule such evidence, which was to be included in the testimony and exhibits, inadmissible or for other appropriate action to be taken as may be just and reasonable.

§1.65.Exhibits.

(a) Form. Exhibits to be offered in evidence at a hearing shall be of a size which will not unduly encumber the record. Whenever practicable, exhibits shall conform to the size requirements established by §1.32 of this title (relating to Form and Content of Pleadings). The pages of each exhibit shall be numbered consecutively.

(b) Tender and service. The original or a true and correct copy of each exhibit offered in evidence shall be identified and tendered for inclusion in the record. Copies of the exhibit shall be furnished to the examiners, to the court reporter, and to each party prior to or at the time the exhibit is offered in evidence.

(c) Excluded exhibits. If an exhibit is offered, objected to, and excluded, the examiner may determine whether or not the party offering the exhibit wishes to withdraw the offer; if so, the examiner shall permit the return of the exhibit to the party. If the excluded exhibit is not withdrawn, it shall be given an exhibit number for identification, shall be endorsed by the examiner with the ruling, and shall be included in the record for the purpose of preserving an exception.

(d) Late exhibits. Unless specifically requested and permitted by the Commissioners, the Hearings Director, or the examiner, no exhibit shall be filed in any proceeding after the hearing has been completed. If the filing of a late-filed exhibit is permitted, copies shall be served on all parties, and each party will have the opportunity to respond and submit additional relevant responsive evidence.

§1.66.Written Objections Not Required.

Written objections to rulings made by the examiner during a hearing are not required. It shall be sufficient that the party make a timely objection and state the grounds for the objection on the record.

§1.67.Offers of Proof.

(a) When the examiner excludes evidence, the party offering the evidence shall be permitted to make an offer of proof prior to the close of the hearing.

(1) The party may make the offer in question and answer form, or by dictating or submitting in writing the substance of the proposed evidence.

(2) The examiner may direct the manner in which the offer is made and may ask questions if necessary to conclude that the evidence would be as represented.

(3) The examiner and opposing parties shall be entitled to cross-examine any witness testifying on an offer of proof.

(b) The examiner may direct that offers of proof be transcribed separately and that reporter's costs be assessed against the proponent of the evidence, subject to the Commissioners' review of the examiner's ruling.

§1.68.Confidential Materials.

(a) Applicability of the Public Information Act. All records, data, and information filed with the Commission are subject to the Texas Public Information Act, Texas Government Code, Chapter 552. If the Commission receives a third party request for materials that have been marked confidential pursuant to subsection (b) or (c) of this section, the Commission will notify the filing party of the request in accordance with the provisions of the Texas Public Information Act so that the party can take action with the Office of the Attorney General to oppose release of the materials.

(b) Filing confidential materials in a hearing before the Hearings Division.

(1) A party filing material in a hearing before the Hearings Division that the party contends to be confidential by law shall file the materials with the Docket Services Section by delivering them in a sealed and labeled container, accompanied by an explanatory cover letter. The cover letter shall identify the docket number and the style of the case, explain the nature of the sealed materials, and specify the relief sought. The outside of the container shall identify the docket number, the style of the case, the name of the submitting party, and be marked "CONFIDENTIAL AND UNDER SEAL" in bold print at least one inch in size. The front page of each portion of confidential material shall be marked "confidential." Confidential material shall not be filed by fax. A party who elects to file confidential material electronically shall notify the Docket Services Section prior to filing such material.

(2) A party may file a motion to seal the record if it has filed confidential materials in accordance with paragraph (1) of this subsection. In the motion, the party shall describe the materials it contends to be confidential by law, indicate the specific provision of law that exempts the material from disclosure, and request that the examiner order the described materials to be sealed. The examiner may, after consideration at hearing, order the described materials to be sealed, subject to any determination by the Office of the Attorney General and as further described in subsection (a) of this section.

(3) Confidential materials filed with the Hearings Division will be retained until the contested case is no longer appealable and in accordance with the Commission's retention policy.

(c) Filing confidential materials with the Commission other than in a hearing.

(1) A party filing material with a division of the Commission other than the Hearings Division that the party contends to be confidential by law shall file the materials with the applicable division by delivering them in a sealed and labeled container accompanied by an explanatory cover letter. The cover letter shall explain the nature of the sealed materials. The outside of the container shall identify the name of the submitting party and be marked "CONFIDENTIAL AND UNDER SEAL" in bold print at least one inch in size. The front page of each portion of confidential material shall be marked "confidential." Confidential material shall not be filed by fax. A party who elects to file confidential material electronically shall notify the applicable division prior to filing such material.

(2) Confidential materials filed under this subsection will be retained in accordance with the Commission's retention policy.

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 February 28, 2017.

TRD-201700803

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER G. HEARINGS

16 TAC §§1.101 - 1.112

The Commission proposes the new rules under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.101.Examiner's Powers and Duties.

(a) For any assigned case and subject to any limitations imposed by law or by Commission rule, the examiner shall have broad discretion in regulating the course and conduct of the hearing. The examiner's authority includes, but is not limited to, the following authority:

(1) to administer oaths and affirmations;

(2) to issue subpoenas to compel the attendance of witnesses and the production of papers and documents;

(3) to authorize the taking of depositions and issue discovery orders;

(4) to call and examine witnesses;

(5) to receive evidence;

(6) to rule upon the admissibility of evidence and amendments to pleadings;

(7) to limit the number of witnesses whose testimony would be merely cumulative;

(8) to set reasonable times within which a party may testify, cross-examine witnesses, or present evidence;

(9) to impose sanctions;

(10) to maintain order in a hearing;

(11) to recess any hearing;

(12) to issue a proposal for decision, including proposed findings of fact and conclusions of law and a recommended order;

(13) to reopen the record when justice requires;

(14) to amend the proposal for decision or recommended order, or both;

(15) to issue a supplemental or amended proposal for decision and proposed order;

(16) to review the jurisdiction of the Commission and standing of parties as it pertains to a contested case;

(17) to issue orders relating to hearing, prehearing and posthearing matters; and

(18) to take other permissive action which is necessary for a fair, just, and proper hearing.

(b) If at any time the examiner is unable to continue to serve, the Hearings Director may appoint another examiner to perform any remaining functions without the necessity of repeating previous proceedings.

(c) At their discretion, the Commissioners may preside over contested cases pursuant to this section.

§1.102.Sanctioning Authority.

(a) In the interest of justice, and after notice and opportunity for hearing, an order imposing sanctions may be issued by the Commissioners, the Hearings Director, or the examiner for:

(1) abuse of the discovery process, including failure to comply with a discovery order or subpoena issued by the Commission for deposition or production of books, records, papers, or other objects;

(2) filing a motion or pleading that is determined to be groundless and brought:

(A) in bad faith;

(B) for the purpose of harassment; or

(C) for any other improper purpose, such as to cause unnecessary delay or increase in the cost of the proceeding; or

(3) failure to obey an order of the Commissioners, the Hearings Director, or the examiner.

(b) The order imposing sanctions may:

(1) disallow any further discovery of any kind or of a particular kind by the sanctioned party;

(2) require the party, the party's authorized representative, or both to obey the discovery order;

(3) require the party, the party's authorized representative, or both to pay reasonable expenses, including attorney fees, incurred by reason of the party's noncompliance;

(4) direct that the matters for which the discovery order was made shall be deemed admitted in accordance with the claim of the party obtaining the order;

(5) refuse to allow the sanctioned party to support or oppose designated claims or defenses or prohibit the party from introducing designated matters in evidence;

(6) strike pleadings or parts thereof or abate further proceedings until the order is obeyed;

(7) disallow in whole or in part requests for relief by the offending party and exclude evidence in support of those requests; or

(8) dismiss the action or proceeding or any part thereof or render a decision by default against the sanctioned party.

(c) Any order imposing sanctions issued by the examiner or the Hearings Director is subject to review by an appeal to the Commissioners. The appeal shall be filed with the Docket Services Section, which will forward the pleading to the Commissioners and the Hearings Director.

§1.103.Prehearing and Posthearing Conferences.

(a) The Hearings Director or examiner may direct the parties, the parties' authorized representatives, or both, to appear at a prehearing or posthearing conference to consider the following, as may be applicable:

(1) motions and other preliminary matters relating to the proceeding, including discovery;

(2) settlement of the case or simplification of the issues;

(3) amendment of pleadings;

(4) admissions or stipulations which will avoid the unnecessary introduction of evidence;

(5) limitations on the number of witnesses;

(6) time to be allotted to each party for presentation of its direct case or for cross-examination at the hearing;

(7) procedures to be followed at the hearing; and

(8) other matters that may aid in the disposition of the proceeding.

(b) For any ruling not disclosed on the record, the examiner shall notify the parties in writing of the disposition of a matter considered at a prehearing or posthearing conference.

§1.104.Stipulations.

The examiners will not consider any stipulation or agreement unless it is in writing and signed by the parties or their authorized representatives, or dictated into the record during the course of the proceeding. This section does not limit a party's ability to waive or modify by stipulation any right or privilege afforded by these rules, unless otherwise precluded by law.

§1.105.Continuances.

(a) A motion for continuance shall:

(1) be in writing and served in accordance with §1.45 of this title (relating to Service in Protested Contested Cases;

(2) be filed not less than five business days prior to the hearing, except for good cause shown;

(3) set forth the specific grounds for which the moving party seeks continuance;

(4) make reference to all similar motions filed in the proceeding; and

(5) state whether all parties agree with the relief requested.

(b) A continuance will not be granted based on the need for discovery if discovery requests have not previously been served upon the person from whom discovery is sought, except when necessary due to surprise or discovery of facts or evidence previously undisclosed despite the diligence of the moving party.

(c) The moving party shall confer with all other parties regarding the motion and establish mutually agreeable calendar dates on which the parties are available.

(d) A motion for continuance shall be acted upon by the examiner or Hearings Director, subject to Commission review.

(e) If the motion is filed less than five business days prior to the hearing, the moving party shall state good cause for the failure to timely file and immediately notify all parties and the assigned court reporter of the disposition of the motion.

§1.106.Consolidation and Joint Hearings.

When two or more applications, petitions, or other proceedings involve common questions of law or fact, the appropriate division director, the Hearings Director or the examiner may consolidate the proceedings or direct that there be a joint hearing without formal consolidation and may take other action to avoid unnecessary costs or delay and to ensure due process.

§1.107.Dismissal.

The Commissioners or the Hearings Director may dismiss, with or without prejudice, any proceeding under such conditions and for such reasons as are found to be just and reasonable, including the following:

(1) failure to prosecute;

(2) unnecessary duplication of proceedings or res judicata;

(3) withdrawal;

(4) moot questions or obsolete petitions;

(5) lack of jurisdiction; or

(6) if necessary in the interest of justice.

§1.108.Place and Nature of Hearings.

All hearings shall be open to the public and, except as otherwise required by law, shall be held in Austin. The Commissioners or the Hearings Director may designate another place of hearing if for good cause and in the public interest.

§1.109.Hearing Procedures.

(a) Opening the hearing. The examiner shall call the hearing to order and make a concise statement of its scope and purposes. All parties shall then enter their appearances. Thereafter, parties may make motions or opening statements.

(b) Order of procedure. Parties shall be permitted to make opening statements, offer direct evidence, cross-examine witnesses, and present supporting arguments. The party having the burden of proof shall be entitled to open and close. When several proceedings are heard on a consolidated record or when the proceeding has been initiated by the Commission, the examiner shall designate who may open and close. The examiner shall determine at what stage intervenors will be permitted to offer evidence. The examiner may direct that closing arguments be made in writing. The examiner may alter the order of procedure if necessary for efficient conduct of the hearing.

(c) Voir dire. Voir dire examination to evaluate the qualifications of a witness to testify may be permitted but will not be substituted for cross-examination.

(d) Rebuttal. The petitioner, applicant, or complainant may rebut evidence and argument presented by protestants or intervenors. The examiner may allow additional rebuttal from other parties.

(e) Additional evidence. The Commissioners, Hearings Director, or examiner may subpoena records or may call upon or subpoena for additional evidence on any issue any party, person, or employee of the Commission who is not assigned to render a decision or to make findings of fact and conclusions of law for additional evidence on any issue. Additional evidence shall not be admitted without an opportunity for examination, objection, and rebuttal by all parties.

§1.110.Burden of Proof.

Generally, the party seeking affirmative relief shall have the burden of proof. An examiner may reassign the burden of proof and shall serve copies of the decision on all parties. In reassigning the burden of proof, the examiner may consider:

(1) the classification of the parties;

(2) the parties' access to information pertinent to the merits of the case;

(3) the party seeking affirmative relief;

(4) the party seeking to change the status quo;

(5) whether a party would be required to prove a negative; and

(6) the nature of the relief that is requested.

§1.111.Reporters and Transcripts.

(a) Request for transcript. When requested by the Commission, the examiner, or a party, a certified shorthand reporter shall make a verbatim record and transcript of the hearing.

(b) Assessment of costs. The cost of the original transcripts shall be assessed to all parties equally unless otherwise directed by the examiner or required by law.

(c) Charges. The Commission shall approve rates to be charged by reporters for appearances, original transcripts, and copies. The rates shall not exceed rates authorized by law to be paid to court reporters in Texas district courts.

§1.112.Proceedings by Telephony.

(a) The examiner may sua sponte or upon granting the timely written motion of a party order that all or part of a prehearing or posthearing conference or hearing be conducted by telephony.

(b) A party may file a motion to appear at a prehearing or posthearing conference or a hearing by telephony as follows:

(1) The motion shall be in writing, shall be filed with the Docket Services Section and served in accordance with §1.45 of this title (relating to Service in Protested Contested Cases) not less than 10 days prior to the proceeding at which the party wishes to appear remotely, and shall include the pertinent telephone number(s) and/or other connection instructions.

(2) If the motion is to conduct only a portion of the proceeding by telephony, the requesting party shall identify the relevant portion of the proceeding to be conducted by telephony.

(3) Any reply to a motion shall be made in writing and shall be filed with the Docket Services Section and served in accordance with §1.45 of this title within five days of service of the motion.

(4) Upon agreement of the parties or a finding of good cause, the examiner may modify the times for filing a motion for an appearance by telephony and/or replies to such a motion.

(c) Unless a timely objection is filed by another party, the examiner may grant the motion if:

(1) the moving party will not present any evidence as part of its direct case other than the oral testimony of that party or a single party representative; and

(2) the motion is to appear by telephony for which the Commission has all necessary equipment and technology.

(d) If a timely objection is filed, the objecting party has the burden of showing how the requested relief will unduly burden the proceeding or unfairly prejudice the objecting party.

(e) If the moving party will present any evidence other than the oral testimony of that party or a single party representative or requests a method of telephony for which the Commission does not have all necessary equipment and technology, and no timely objection is filed, the examiner shall consider the factors in subsection (f) of this section and issue a ruling on the motion. If a timely objection is filed, the moving party shall have the burden of showing that the requested relief will not unduly burden the proceeding or unfairly prejudice any party and the examiner shall issue a ruling taking into consideration the arguments of the parties and the factors in subsection (f) of this section.

(f) In considering whether conducting all or part of a prehearing or posthearing conference or hearing by telephony is feasible, the examiner shall ensure that the proceeding will provide due process and will be fair, and shall take into account the following factors:

(1) whether a party's request is timely;

(2) whether all parties to a protested proceeding have agreed in writing to conducting all or part of the proceeding by telephony;

(3) equipment and technology constraints;

(4) the number of parties;

(5) the number of witnesses;

(6) the number and type of exhibits;

(7) the distance of the parties or witnesses from Austin;

(8) the nature of the hearing;

(9) the testimony to be offered; and

(10) any other pertinent factors which may affect the proceeding.

(g) The examiner shall issue a ruling within a reasonable time period prior to the proceeding stating whether the proceeding will be conducted, in whole or in part, by telephony and serve prompt written notice of the ruling on all parties.

(h) The Commission may consider the following events to constitute a failure to appear and grounds for default or dismissal:

(1) failure to connect or answer for more than 10 minutes after the scheduled time for the proceeding;

(2) failure to be ready to proceed with the proceeding after 10 minutes of the scheduled time; and

(3) a party's intentional disconnection.

(i) In the event of accidental disconnection of one or more parties to the proceeding or other technical issues, the examiner shall immediately recess the hearing and attempt to re-establish the connection or connections.

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 February 28, 2017.

TRD-201700804

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER H. DECISION

16 TAC §§1.121 - 1.131

The Commission proposes the new rules under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas on February 28, 2017.

§1.121.Proposals for Decision.

(a) In a contested case, if a majority of the Commissioners have not heard the case or read the record, the decision, if adverse to a party other than the Commission, may not be made until:

(1) a proposal for decision is served on each party; and

(2) an opportunity is afforded to each adversely affected party to file exceptions and present briefs to the Commission.

(b) The proposal for decision must contain a statement of the reasons for the proposed decision and of each finding of fact and conclusion of law necessary to the proposed decision, prepared by the person who conducted the hearing or by one who has read the record.

(c) The parties may waive the requirements of subsections (a) and/or (b) of this section by written stipulation.

(d) The examiner may direct a party to draft and submit proposed findings of fact and conclusions of law. The examiner may limit the request for proposed findings or conclusions to any particular issue or issues of fact. The party's proposed findings of fact and conclusions of law shall be supported by concise and explicit statements of underlying facts developed from the record with specific record references. If the examiner requires the filing of proposed findings of fact or conclusions of law, the Commissioners shall rule on each proposed finding and conclusion. If the examiner permits but does not require a party to submit proposed findings of fact or conclusions of law, a ruling on the proposed findings or conclusions is not required.

(e) When a proposal for decision is issued, a copy of the proposal shall be served promptly on each party or its authorized representative.

(f) An examiner may amend or correct a previously served proposal for decision or proposed order and shall serve the amendment or correction on the parties. Exceptions and replies are not permitted in response to a clerical or typographical correction. When substantive amendments are necessary prior to presentation at conference, an examiner shall specify the time period for the filing of exceptions and replies. Amendments adopted by the Commission shall be noted with specificity in the Commission's final order.

§1.122.Filing of Exceptions and Replies.

(a) Any party may, within 15 days after the date of service of a proposal for decision, file exceptions to the proposal for decision. Replies to such exceptions may be filed by any other party within 10 days after the deadline for filing such exceptions. Either party may file a case summary with the party's exceptions or replies.

(1) Exceptions and replies shall be filed with the Docket Services Section by hand delivery, first class, certified or registered mail, or commercial delivery service. The number of copies filed will be determined by the examiner as stated in the notice to the parties issued with the proposal for decision. Exceptions, replies, and case summaries may not be filed by fax or email unless permitted by the examiner or Hearings director.

(2) All copies shall be unstapled and three-hole punched for a three-ring binder.

(3) The filing party shall serve the exceptions or replies in accordance with §1.45 of this title (relating to Service in Protested Contested Cases).

(b) The examiner, or the parties by agreement with the examiner's approval, may lengthen or shorten the time periods set out in this section if good cause is shown. A request for extension of time within which to file exceptions or replies shall be filed with the examiner and copies shall be served by the party making such a request in accordance with §1.45 of this title. The examiner shall promptly notify the parties of any action taken and shall grant the request only if good cause is shown.

(c) The Commissioners may consider the case as soon as:

(1) the time for filing exceptions and replies expires; or

(2) the exceptions and replies are filed, if filed before the filing deadline.

(d) Additional filings shall not be made and will not be accepted or considered after an item has been included on a Commission open meeting agenda posted with the Secretary of State unless the filing:

(1) exclusively concerns material circumstances or events that arose after the item was posted; or

(2) was requested by the Commissioners, the Hearings Director, or the examiner.

§1.123.Commission Action.

(a) At an open meeting, the Commissioners may:

(1) adopt, modify, or reject the examiner's proposed findings of fact and conclusions of law in whole or in part;

(2) remand the proceeding for further consideration by the same examiner or a different examiner;

(3) direct the examiner to further consider the case with or without reopening the hearing.

(b) If, on remand by the Commissioners, additional evidence is received which results in a substantial change of the examiner's recommendation for final action, an amended proposal for decision shall be prepared and circulated to the parties, unless a majority of the Commission has held the hearing or read the record. If an amended proposal for decision is prepared, all parties shall have the right to file exceptions, replies, and briefs.

§1.124.Oral Argument before the Commission.

(a) Any party may request oral argument on a matter before the Commissioners by filing the request with the Docket Services Section as part of a party's exceptions, replies to exceptions, motion for rehearing, or reply to a motion for rehearing. A party may not orally request the opportunity to make oral argument at a Commission open meeting.

(b) Oral argument may be allowed at the discretion of the Commissioners. Failure of the Commissioners to grant a request for oral argument shall be deemed denial of the request.

(c) The Commissioners may request that parties to any proceeding present oral argument.

(d) If the Commissioners will hear oral argument, the Commissioners shall determine the date, time, and order of the oral argument. The Commissioners may:

(1) request that parties focus their arguments on particular issues in the case;

(2) determine the sequence in which parties will proceed, and which party, if any, may close;

(3) impose time limits on all speakers;

(4) limit or exclude unduly repetitious arguments and presentations;

(5) require that one representative present the information and position of closely aligned persons or entities; and

(6) set deadlines for filing additional information or written briefs in the case.

(e) Persons who need special equipment or assistance and who have a special request concerning the presentation of comments or oral argument should contact the secretary of the Commission at least 48 hours prior to the start of the open meeting to ensure that they are provided with the necessary special equipment or assistance. Failure to make such a request will not preclude a person from providing comment or oral argument. A special request includes:

(1) presentation of video or audio recordings; and/or

(2) use of audio or visual aids.

(f) The Commissioners will accept unsolicited comments from elected officials when they are acting in their official capacities.

§1.125.Interim Orders Entered by the Commissioners.

When an interim order is provided for by law, a request for an interim order will be presented to the Commissioners for consideration at an open meeting. An interim order shall not be considered a final Commission decision. Interim orders are not appealable and shall not be subject to exceptions or motions for rehearing, as provided by the APA or the rules in this chapter.

§1.126.Final Decisions and Orders.

(a) A final decision or final order adverse to any party in a contested case shall be in writing and shall be signed by two or more Commissioners. Final decisions or final orders shall include findings of fact and conclusions of law separately stated. Findings of fact, if set forth in statutory language, shall be accompanied by a concise and explicit statement of the underlying facts supporting the findings. If in accordance with §1.121 of this title (relating to Proposals for Decision) a party submits proposed findings of fact or conclusions of law as required by the examiner, the decision shall include a ruling or order on each proposed finding. All parties shall be notified of any decision or order pursuant to subsections (b) and (c) of this section.

(b) When a decision or order in a contested case that may become final under Texas Government Code, §2001.144 is signed or when an order ruling on a motion for rehearing is signed, the Commission shall deliver or send a copy of the decision or order to each party in accordance with subsection (c) of this section. The Commission shall keep a record documenting the provisions of the notice provided to each party.

(c) Methods of notice. The Commission shall notify each party to a contested case of any decision or order of the Commission in the following manner:

(1) personally;

(2) if agreed to by the party to be notified, by email to the party's current email address or fax number of the party's authorized representative, or of the party if the party is not represented; or

(3) by first class, certified, or registered mail, or commercial delivery service sent to the last known address of the party's authorized representative or of the party if the party is not represented.

§1.127.Effective Date.

A decision or order becomes final as provided in §1.130 of this title (relating to Finality of Decisions or Orders). The effective date of a decision or order is the date it is signed by a majority of the Commissioners, unless otherwise stated in the order and subject to a motion for rehearing. The effective date shall be incorporated into the body of the decision.

§1.128.Motions for Rehearing.

(a) Motions for rehearing, if filed, must be filed by a party not later than the 25th day after the decision or order that is the subject of the motion is signed, unless the time for filing the motion for rehearing has been extended under subsection (e) of this section. A motion for rehearing must identify with particularity the findings of facts or conclusions of law that are the subject of the complaint and any evidentiary or legal ruling claimed to be erroneous. The motion must also state the legal and factual basis for the claimed error. On filing of the motion for rehearing, copies of the motion shall be served on all other parties in accordance with §1.45 of this title (relating to Service in Protested Contested Cases).

(b) Replies to motions for rehearing must be filed not later than the 40th day after the date the decision or order that is subject of the motion is signed, or not later than the 10th day after the date a motion for rehearing is filed if the time for filing the motion for rehearing has been extended by an agreement or by a written Commission order. On filing of the reply, copies of the reply shall be served on all other parties in accordance with §1.45 of this title.

(c) Motions for rehearing and replies to motions for rehearing may not be filed by fax or email unless permitted by the examiner or the Hearings director. The number of copies required to be filed will be determined by the examiner as noted in the notice to the parties issued with the proposal for decision. All copies shall be unstapled and three-hole punched for a three-ring binder.

(d) Commissioners shall act on a motion for rehearing not later than the 55th day after the date the decision or order that is the subject of the motion is signed or the motion for rehearing is overruled by operation of law.

(e) The deadline for filing a motion for rehearing may be extended as follows:

(1) The Commission may, on its own initiative or on the motion of any party for cause shown, by written order, extend the period of time for filing these motions and replies and for taking Commission action, provided that the Commission extends the time or takes the action not later than the 10th day after the date the period for filing a motion or reply or taking agency action expires. An extension shall not extend the period for Commission action beyond the 100th day after the date the decision or order that is the subject of the motion is signed. In the event of an extension, the motion for rehearing is overruled by operation of law on the date fixed by the order or, in the absence of a fixed date, on the 100th day after the decision or order that is the subject of the motion is signed;

(2) The parties may, by agreement and with the approval of the Commission, provide for a modification of the time periods provided in this section; or

(3) Pursuant to Texas Government Code, §2001.142.

(f) A subsequent motion for rehearing is not required after the Commission rules on a motion for rehearing unless the order disposing of the original motion for rehearing:

(1) modifies, corrects, or reforms in any respect the decision or order that is the subject of the complaint, other than a typographical, grammatical, or other clerical change identified as such by the agency in the order, including any modification, correction, or reformation that does not change the outcome of the contested case; or

(2) vacates the decision or order that is the subject of the motion and provides for a new decision or order.

(g) A subsequent motion for rehearing required by subsection (f) of this section must be filed not later than the 25th day after the date the order disposing of the original motion for rehearing is signed.

§1.129.Effect of Order Granting Rehearing.

An order granting a motion for rehearing vacates the preceding final order. When the Commission renders a new final decision, a motion for rehearing directed to the new decision is a prerequisite to appeal.

§1.130.Finality of Decisions or Orders.

(a) A decision or order in a contested case is final:

(1) if a motion for rehearing is not filed on time, on the expiration of the period for filing a motion for rehearing;

(2) if a motion for rehearing is filed on time, on the date:

(A) the order denying the motion for rehearing is signed; or

(B) the motion is overruled by operation of law;

(3) if the Commission finds that an imminent peril to the public health, safety, or welfare requires immediate effect of a decision or order, on the date the decision or order is signed, provided that the agency incorporates in the decision or order a factual and legal basis establishing an imminent peril to the public health, safety, or welfare; or

(4) on:

(A) the date specified in the decision or order for a case in which all parties agree to the specified date in writing or on the record; or

(B) if the agreed specified date is before the date the decision or order is signed, the date the decision or order is signed.

(b) If a decision or order is final under subsection (a)(3) of this section, the Commission shall recite in the decision or order the finding made under that subsection and the fact that the decision or order is final and effective on the date signed.

§1.131.Administrative Record.

The party appealing the Commission's order shall pay to the Commission the cost of preparing the original or a certified copy of the record prior to it being transmitted to the reviewing court at rates approved by the Office of the Attorney General of Texas. When more than one party appeals the Commission's order, the cost of the preparation of the record shall be divided equally among the appealing parties or as agreed by the parties.

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 February 28, 2017.

TRD-201700805

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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


SUBCHAPTER J. RULEMAKING

16 TAC §1.301

The Commission proposes the new rules under Texas Government Code §2001.004, which requires a state agency to adopt rules of practice stating the nature and requirements of all available formal and informal procedures, and Texas Natural Resources Code §81.01006, which allows the Commissioners to adopt all rules necessary for the Commission's government and proceedings.

Cross-reference to statute: Texas Government Code §2001.004; Texas Natural Resources Code §81.01006.

Issued in Austin, Texas, on February 28, 2017.

§1.301.Petition for Adoption of Rules.

(a) An interested person may petition the Commission requesting adoption of a rule. Petitions shall be in writing and filed with the Office of General Counsel.

(b) Each petition must state the name and address of the petitioner.

(c) Each petition shall include:

(1) a brief explanation of the proposed rule;

(2) the text of the proposed rule prepared in a manner to indicate the words to be added or deleted from the current text, if any;

(3) a statement of the statutory or other authority under which the rule is proposed to be promulgated; and

(4) a justification for adoption of the rule.

(d) For the purposes of this section, an interested person must be:

(1) a resident of this state;

(2) a business entity located in this state;

(3) a governmental subdivision located in this state; or

(4) a public or private organization located in this state that is not a state agency.

(e) The Office of General Counsel shall review all petitions for compliance with this section. If rejected, the petitioner may file a corrected petition that complies with the requirements of this section.

(f) Upon receipt of a petition that complies with the requirements of this section, the Office of General Counsel shall present the petition to the Commissioners with a recommendation on whether a rulemaking proceeding should be initiated.

(g) The Commissioners shall either deny the petition or approve initiation of rulemaking proceedings in accordance with the APA and these rules. The Commission may modify any proposed rule to ensure that it conforms to the format of Commission rules, adequately addresses the subject matter of the petition, and conforms to the filing requirements of the Texas Register.

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 February 28, 2017.

TRD-201700806

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Earliest possible date of adoption: April 16, 2017

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