83R20782 SMH-D
By: Bonnen of Brazoria H.B. No. 2166
Substitute the following for H.B. No. 2166:
By: Canales C.S.H.B. No. 2166
A BILL TO BE ENTITLED
AN ACT
relating to the continuation, functions, and name of the Railroad
Commission of Texas; providing for the imposition of fees.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. The heading to Chapter 81, Natural Resources
Code, is amended to read as follows:
CHAPTER 81. TEXAS ENERGY [RAILROAD] COMMISSION [OF TEXAS]
SECTION 2. Section 81.001, Natural Resources Code, is
amended to read as follows:
Sec. 81.001. DEFINITIONS. In this chapter:
(1) "Commission" means the Texas Energy [Railroad]
Commission [of Texas].
(2) "Commissioner" means any member of the Texas
Energy [Railroad] Commission [of Texas].
SECTION 3. Subchapter A, Chapter 81, Natural Resources
Code, is amended by adding Section 81.003 to read as follows:
Sec. 81.003. TEXAS ENERGY COMMISSION. (a) The Railroad
Commission of Texas is renamed the Texas Energy Commission.
(b) A reference in law to:
(1) the Railroad Commission of Texas means the Texas
Energy Commission; and
(2) a railroad commissioner or a member of the
Railroad Commission of Texas means a member of the Texas Energy
Commission.
SECTION 4. Section 81.01001, Natural Resources Code, is
amended to read as follows:
Sec. 81.01001. SUNSET PROVISION. The Texas Energy
[Railroad] Commission [of Texas] is subject to Chapter 325,
Government Code (Texas Sunset Act). Unless continued in existence
as provided by that chapter, the commission is abolished September
1, 2023 [2013].
SECTION 5. Subchapter B, Chapter 81, Natural Resources
Code, is amended by adding Sections 81.010015 and 81.010046 to read
as follows:
Sec. 81.010015. ELECTION AND TERMS OF COMMISSIONERS;
VACANCIES. (a) The commission is composed of three commissioners
elected at the general election for state and county officers.
(b) Commissioners serve staggered terms of six years, with
the term of one commissioner expiring December 31 of each
even-numbered year.
(c) The governor shall appoint a person to fill a vacancy on
the commission until the next general election.
Sec. 81.010046. AUTOMATIC RESIGNATION. If a person who is a
member of the commission announces the person's candidacy, or in
fact becomes a candidate, in any general, special, or primary
election for any elective office other than the office of
commissioner, that announcement or that candidacy constitutes an
automatic resignation of the office of commissioner.
SECTION 6. Section 81.01005, Natural Resources Code, is
amended to read as follows:
Sec. 81.01005. NAME AND SEAL. (a) The commissioners are
known collectively as the "Texas Energy [Railroad] Commission [of
Texas]."
(b) The seal of the commission contains a star of five
points with the words "Texas Energy [Railroad] Commission [of
Texas]" engraved on it.
SECTION 7. The heading to Section 81.0521, Natural
Resources Code, is amended to read as follows:
Sec. 81.0521. FEE FOR APPLICATION FOR EXCEPTION TO
[RAILROAD] COMMISSION RULE.
SECTION 8. Sections 81.0531(c) and (d), Natural Resources
Code, are amended to read as follows:
(c) In determining the amount of the penalty, the commission
shall consider the [permittee's history of previous violations, the
seriousness of the violation, any hazard to the health or safety of
the public, and the demonstrated good faith of the person charged.
In determining the amount of the penalty for a violation of a
provision of this title or a rule, order, license, permit, or
certificate that relates to pipeline safety, the commission shall
consider the] guidelines adopted under Subsection (d).
(d) The commission [by rule] shall adopt guidelines to be
used in determining the amount of the penalty. The commission shall
provide an opportunity for public input on the guidelines [for a
violation of a provision of this title or a rule, order, license,
permit, or certificate that relates to pipeline safety]. The
guidelines must [shall] include a penalty calculation worksheet
that specifies the typical penalty for certain violations,
circumstances justifying enhancement of a penalty and the amount of
the enhancement, and circumstances justifying a reduction in a
penalty and the amount of the reduction. The guidelines must
provide for different penalties for different violations based on
the seriousness of the violation and any hazard to the health or
safety of the public resulting from the violation. The guidelines
must [shall] take into account:
(1) the permittee's history of previous violations,
including the number of previous violations;
(2) the seriousness of the violation and of any
pollution resulting from the violation;
(3) any hazard to the health or safety of the public;
(4) the degree of culpability;
(5) the demonstrated good faith of the person charged;
[and]
(6) the number of times the permittee's certificate of
compliance issued under Subchapter P, Chapter 91, has been
canceled; and
(7) any other factor the commission considers
relevant.
SECTION 9. Subchapter C, Chapter 81, Natural Resources
Code, is amended by adding Sections 81.0645, 81.065, and 81.066 to
read as follows:
Sec. 81.0645. EX PARTE COMMUNICATIONS. The commission by
rule shall develop a policy to prohibit an ex parte communication
between a hearings examiner and a commissioner or between a
hearings examiner and a member of the technical staff of the
commission who has participated in a hearing. The policy must
prohibit a commissioner from communicating with a hearings examiner
other than in a formal public hearing.
Sec. 81.065. NEGOTIATED RULEMAKING AND ALTERNATIVE DISPUTE
RESOLUTION POLICY. (a) The commission shall develop and implement
a policy to encourage the use of:
(1) negotiated rulemaking procedures under Chapter
2008, Government Code, for the adoption of commission rules; and
(2) appropriate alternative dispute resolution
procedures under Chapter 2009, Government Code, to assist in the
resolution of internal and external disputes under the commission's
jurisdiction.
(b) The commission's procedures relating to alternative
dispute resolution must conform, to the extent possible, to any
model guidelines issued by the State Office of Administrative
Hearings for the use of alternative dispute resolution by state
agencies.
(c) The commission shall:
(1) coordinate the implementation of the policy
adopted under Subsection (a);
(2) provide training as needed to implement the
procedures for negotiated rulemaking or alternative dispute
resolution; and
(3) collect information concerning the effectiveness
of those procedures.
Sec. 81.066. ENFORCEMENT POLICY. (a) The commission shall
adopt an enforcement policy to guide the employees of the
commission in evaluating violations of the provisions of this title
that pertain to safety or the prevention or control of pollution or
the provisions of a rule, order, license, permit, or certificate
that pertains to safety or the prevention or control of pollution
and is issued under this title.
(b) The enforcement policy adopted under this section must
include:
(1) a specific process for classifying violations
based on:
(A) the seriousness of any pollution resulting
from the violation; and
(B) any hazard to the health or safety of the
public; and
(2) standards to provide guidance to commission
employees on which violations may be dismissed once the permittee
comes into compliance and which violations must be forwarded for
enforcement.
(c) The standards adopted under Subsection (b)(2) must
require a commission employee to take into account the permittee's
history of previous violations in determining whether to dismiss a
violation once the permittee comes into compliance or forward the
violation for enforcement.
SECTION 10. Sections 81.067(b) and (c), Natural Resources
Code, are amended to read as follows:
(b) The commission shall certify to the comptroller the date
on which the balance in the fund equals or exceeds $30 [$20]
million. The oil-field cleanup regulatory fees on oil and gas
shall not be collected or required to be paid on or after the first
day of the second month following the certification, except that
the comptroller shall resume collecting the fees on receipt of a
commission certification that the fund has fallen below $25 [$10]
million. The comptroller shall continue collecting the fees until
collections are again suspended in the manner provided by this
subsection.
(c) The fund consists of:
(1) proceeds from bonds and other financial security
required by this chapter and benefits under well-specific plugging
insurance policies described by Section 91.104(c) that are paid to
the state as contingent beneficiary of the policies, subject to the
refund provisions of Section 91.1091, if applicable;
(2) private contributions, including contributions
made under Section 89.084;
(3) expenses collected under Section 89.083;
(4) fees imposed under Section 85.2021;
(5) costs recovered under Section 91.457 or 91.459;
(6) proceeds collected under Sections 89.085 and
91.115;
(7) interest earned on the funds deposited in the
fund;
(8) oil and gas waste hauler permit application fees
collected under Section 29.015, Water Code;
(9) costs recovered under Section 91.113(f);
(10) hazardous oil and gas waste generation fees
collected under Section 91.605;
(11) oil-field cleanup regulatory fees on oil
collected under Section 81.116;
(12) oil-field cleanup regulatory fees on gas
collected under Section 81.117;
(13) fees for a reissued certificate collected under
Section 91.707;
(14) fees collected under Section 91.1013;
(15) fees collected under Section 89.088;
(16) fees collected under Section 91.142;
(17) fees collected under Section 91.654;
(18) costs recovered under Sections 91.656 and 91.657;
(19) two-thirds of the fees collected under Section
81.0521;
(20) fees collected under Sections 89.024 and 89.026;
(21) legislative appropriations; [and]
(22) any surcharges collected under Section 81.070;
and
(23) money deposited in the fund under Section
113.243.
SECTION 11. Section 81.068, Natural Resources Code, is
amended to read as follows:
Sec. 81.068. PURPOSES [PURPOSE] OF OIL AND GAS REGULATION
AND CLEANUP FUND. Money in the oil and gas regulation and cleanup
fund may be used by the commission or its employees or agents for
any purpose related to the regulation of oil and gas development,
including oil and gas monitoring and inspections, oil and gas
remediation, and oil and gas well plugging, the Alternative Fuels
Research and Education Division program, public information and
services related to those activities, and administrative costs and
state benefits for personnel involved in those activities.
SECTION 12. Sections 81.069(b) and (c), Natural Resources
Code, are amended to read as follows:
(b) The commission shall provide to the Legislative Budget
Board and post on the commission's Internet website quarterly
reports [to the Legislative Budget Board] that include:
(1) the following information with respect to the
period since the last report was provided as well as cumulatively:
(A) the amount of money deposited in the oil and
gas regulation and cleanup fund;
(B) the amount of money spent from the fund for
the purposes described by Subsection (a);
(C) the balance of the fund; and
(D) the commission's progress in meeting the
quarterly performance goals established under Subsection (a) and,
if the number of orphaned wells plugged with state-managed funds,
abandoned sites investigated, assessed, or cleaned up with state
funds, or surface locations remediated is at least five percent
less than the number projected in the applicable goal established
under Subsection (a), an explanation of the reason for the
variance; and
(2) any additional information or data requested in
writing by the Legislative Budget Board.
(c) The commission shall submit to the legislature and make
available to the public, including by posting on the commission's
Internet website, annually, a report that reviews the extent to
which money provided under Section 81.067 has enabled the
commission to better protect the environment through oil-field
cleanup activities. The report must include:
(1) the performance goals established under
Subsection (a) for that state fiscal year, the commission's
progress in meeting those performance goals, and, if the number of
orphaned wells plugged with state-managed funds, abandoned sites
investigated, assessed, or cleaned up with state funds, or surface
locations remediated is at least five percent less than the number
projected in the applicable goal established under Subsection (a),
an explanation of the reason for the variance;
(2) the number of orphaned wells plugged with
state-managed funds, by region;
(3) the number of wells orphaned, by region;
(4) the number of inactive wells not currently in
compliance with commission rules, by region;
(5) the status of enforcement proceedings for all
wells in violation of commission rules and the period during which
the wells have been in violation, by region in which the wells are
located;
(6) the number of surface locations remediated, by
region;
(7) a detailed accounting of expenditures of money in
the fund for oil-field cleanup activities, including expenditures
for plugging of orphaned wells, investigation, assessment, and
cleaning up of abandoned sites, and remediation of surface
locations;
(8) the method by which the commission sets priorities
by which it determines the order in which orphaned wells are
plugged;
(9) a projection of the amount of money needed for the
next biennium for plugging orphaned wells, investigating,
assessing, and cleaning up abandoned sites, and remediating surface
locations; and
(10) the number of sites successfully remediated under
the voluntary cleanup program under Subchapter O, Chapter 91, by
region.
SECTION 13. Subchapter C, Chapter 81, Natural Resources
Code, is amended by adding Section 81.071 to read as follows:
Sec. 81.071. PIPELINE SAFETY AND REGULATORY FEES. (a) The
commission by rule may establish pipeline safety and regulatory
fees to be assessed annually against persons owning or operating
pipelines in Texas that are subject to the jurisdiction of the
commission as established under Section 81.051. The fees must be in
amounts that in the aggregate are sufficient to support all
pipeline safety and regulatory program costs, including:
(1) permitting or registration costs;
(2) mapping costs;
(3) administrative costs; and
(4) costs of employee salaries and benefits.
(b) The commission by rule must establish the method or
methods by which the fees will be calculated and assessed so that
fee amounts will reflect the time spent and costs incurred to
perform the regulatory work associated with permitting or
registering pipelines, the effects of required fees on owners and
operators of all sizes, and other factors the commission determines
are important to the fair imposition of the fees. The commission
may base the fees on any factor the commission considers necessary
to efficiently and fairly recover the pipeline safety and
regulatory program's costs, including:
(1) the length of the pipeline;
(2) the number of new permits, permit renewals, or
permit amendments; or
(3) the number of pipeline owners, operators, or
systems.
(c) The commission by rule may provide that a fee assessed
under this section that is submitted with a permit application that
is denied is nonrefundable.
(d) The commission by rule may establish a reasonable late
payment penalty for a fee assessed under this section.
(e) The authority provided by this section is in addition to
the authority provided by Section 121.211, Utilities Code, and the
commission shall consider any fees assessed under that section in
establishing the fees to be assessed under this section.
SECTION 14. Section 91.1135(e), Natural Resources Code, is
transferred to Section 81.069, Natural Resources Code,
redesignated as Section 81.069(d), Natural Resources Code, and
amended to read as follows:
(d) [(e)] The commission shall provide to the Legislative
Budget Board and post on the commission's Internet website
quarterly reports [to the committee and the Legislative Budget
Board] that include[:
[(1)] the following information with respect to the
period since the last report was provided as well as cumulatively:
(1) [(A)] the amount of money deposited in the oil and
gas regulation and [oil-field] cleanup fund;
(2) [(B)] the amount of money spent from the fund;
(3) [(C)] the balance of the fund;
(4) [(D)] the number of wells plugged with money from
the fund;
(5) [(E)] the number of sites remediated with money
from the fund; and
(6) [(F)] the number of wells abandoned[; and
[(2) any additional information or data requested in
writing by the committee].
SECTION 15. Subchapter B, Chapter 102, Natural Resources
Code, is amended by adding Section 102.0165 to read as follows:
Sec. 102.0165. LOCATION OF HEARING. (a) At the request of
an interested party and with the consent of each interested party,
the commission may hold the hearing on the application in person or
by telephone at a location in the vicinity of the proposed unit.
(b) The commission may contract with another state agency to
hold hearings on applications for pooling of interests into a unit
under the provisions of this chapter in person or by telephone at
field offices of that agency.
SECTION 16. Section 113.243, Natural Resources Code, is
amended to read as follows:
Sec. 113.243. DEPOSIT AND USE OF CERTAIN REVENUE
[ALTERNATIVE FUELS RESEARCH AND EDUCATION FUND]. (a) The
following revenue shall be deposited in the oil and gas regulation
and cleanup fund [alternative fuels research and education fund is
created] in the state treasury[.
[(b) The fund consists of money from]:
(1) fees charged under this subchapter;
(2) the penalties for the late payment of the fee
charged under this subchapter;
(3) gifts, grants, or other assistance received by the
commission from any source for the purposes of this subchapter;
(4) [interest earned on amounts in the fund;
[(5)] amounts collected by the commission under an
agreement with another state in accordance with Section 113.246(e);
(5) [(6)] assessments, rebates on assessments, and
other money collected by the commission under the Propane Education
and Research Act of 1996 (15 U.S.C. Section 6401 et seq.) or other
applicable federal law; and
(6) [(7)] fees, royalties, or other things of value
received from the items described by Subsections (d)(1)(A)-(D)
[(f)(1)(A)-(D)].
(b) Money deposited in the oil and gas regulation and
cleanup fund under this section [(c) The fund] may be used only by
the commission to pay for activities relating to the specific fuel
from which the fee, royalty, or other thing of value was derived or
the specific fuel, if any, for which the gift, grant, or other
assistance is given, including direct and indirect costs relating
to:
(1) researching all possible uses of LPG and other
environmentally beneficial alternative fuels to enhance air
quality;
(2) researching, developing, and implementing
marketing, advertising, and informational programs relating to
alternative fuels to make alternative fuels more understandable and
readily available to consumers;
(3) developing and implementing conservation and
distribution plans to minimize the frequency and severity of
disruptions in the supply of alternative fuels;
(4) developing a public information plan that will
provide advisory services relating to alternative fuels to
consumers;
(5) developing voluntary participation plans to
promote the use of alternative fuels by federal, state, and local
agencies;
(6) implementing consumer incentive or rebate
programs developed pursuant to Section 113.2435 [of this
subchapter];
(7) other functions the commission determines are
necessary to add a program established by the commission for the
purpose of promoting the use of LPG or other environmentally
beneficial alternative fuels; and
(8) the administrative costs incurred by the
commission under this subchapter.
(c) [(d) If a specific fee, royalty, gift, grant, other
thing of value, or other assistance is designated for or collected
from discrete components of the alternative fuels industry, the
fee, royalty, gift, grant, other thing of value, or other
assistance shall be deposited in a separate account in the fund.
[(e)] The commission may apply for, request, solicit,
contract for, receive, and accept gifts, grants, and other
assistance from any source for the purposes of this subchapter.
(d) [Money received under this subsection shall be
deposited in a separate account in the fund as provided in
Subsection (d) of this section.
[(f)] The commission may:
(1) apply for, register, secure, hold, and protect
under the laws of a state, the United States, or a foreign country a
patent, copyright, trademark, or other evidence of protection or
exclusivity issued for an idea, publication, or other original
innovation fixed in a tangible medium, including:
(A) a logo;
(B) a service mark;
(C) a study;
(D) an engineering, architectural, or graphic
design;
(E) a manual;
(F) automated systems software;
(G) an audiovisual work; or
(H) a sound recording;
(2) enter into a license agreement with a third party
in return for a fee, royalty, or other thing of value; and
(3) waive or reduce the amount of a fee, royalty, or
other thing of value to be assessed if the commission determines
that the waiver will:
(A) further the goals and missions of the
commission's division responsible for alternative fuels research
and education; and
(B) result in a net benefit to the state.
(e) [(g)] Money received under Subsection (d) [(f)] shall
be deposited in [a separate account in] the oil and gas regulation
and cleanup fund as provided by Subsection (a) [(d)], except that
any money received by the commission from the items described by
Subsections (d)(1)(E)-(H) [(f)(1)(E)-(H)] shall be deposited in
the general revenue fund.
SECTION 17. Sections 113.2435(c) and (d), Natural Resources
Code, are amended to read as follows:
(c) Rules adopted and promulgated by the commission under
this section shall specify the following:
(1) rebate levels for various types of equipment such
that the rebates achieve an amount of public good comparable to the
rebate amount;
(2) a condition that the recipient agree to practice
environmentally sound operating principles;
(3) a condition that the rebate recipient agree to not
modify the equipment for a specified number of years as set by the
commission;
(4) any other conditions or restrictions determined by
the commission that would help ensure that either of the desired
goals of achieving energy conservation and efficiency or improving
air quality in this state is furthered;
(5) a limitation on the proportion of the money in the
oil and gas regulation and cleanup fund that was deposited in the
fund under Section 113.243 and is usable for the rebate program that
limits the proportion usable to not more than 50 percent of the
funds available; and
(6) that the name or seal of the commission shall not
be used on any advertising that promotes the propane water heater
rebate program.
(d) Notwithstanding Subsection (c)(5), the commission shall
make available for rebates during a fiscal year the entire amount of
money made available for rebates during the preceding fiscal year
that was not spent during the preceding fiscal year. The amount of
money made available for rebates during the preceding fiscal year
that was not spent during the preceding fiscal year is not counted
in determining the limitation on the proportion of the money in the
oil and gas regulation and cleanup fund that was deposited in the
fund under Section 113.243 and is usable for the rebate program
during a fiscal year.
SECTION 18. Section 117.012(a), Natural Resources Code, is
amended to read as follows:
(a) The commission shall adopt rules that include:
(1) safety standards for and practices applicable to
the intrastate transportation of hazardous liquids or carbon
dioxide by pipeline and intrastate hazardous liquid or carbon
dioxide pipeline facilities; and
(2) [, including] safety standards related to the
prevention of damage to interstate and intrastate hazardous liquid
or carbon dioxide pipeline facilities [such a facility] resulting
from the movement of earth by a person in the vicinity of such a
[the] facility, other than movement by tillage that does not exceed
a depth of 16 inches.
SECTION 19. Section 52.092(c), Election Code, is amended to
read as follows:
(c) Statewide offices of the state government shall be
listed in the following order:
(1) governor;
(2) lieutenant governor;
(3) attorney general;
(4) comptroller of public accounts;
(5) commissioner of the General Land Office;
(6) commissioner of agriculture;
(7) energy [railroad] commissioner;
(8) chief justice, supreme court;
(9) justice, supreme court;
(10) presiding judge, court of criminal appeals;
(11) judge, court of criminal appeals.
SECTION 20. Section 756.126, Health and Safety Code, is
amended to read as follows:
Sec. 756.126. SAFETY STANDARDS AND BEST PRACTICES. The
Texas Energy [Railroad] Commission [of Texas] shall adopt and
enforce rules prescribing safety standards and best practices,
including those described by 49 U.S.C. Section 6105 et seq.,
relating to the prevention of damage by a person to a facility,
including an interstate or intrastate pipeline facility, under the
jurisdiction of the commission.
SECTION 21. Section 121.201(a), Utilities Code, is amended
to read as follows:
(a) The railroad commission may:
(1) by rule prescribe or adopt safety standards for
the transportation of gas and for gas pipeline facilities,
including safety standards related to the prevention of damage to
an interstate or intrastate gas pipeline [such a] facility
resulting from the movement of earth by a person in the vicinity of
the facility, other than movement by tillage that does not exceed a
depth of 16 inches;
(2) by rule require an operator that does not file
operator organization information under Section 91.142, Natural
Resources Code, to provide the information to the commission in the
form of an application;
(3) by rule require record maintenance and reports;
(4) inspect records and facilities to determine
compliance with safety standards prescribed or adopted under
Subdivision (1);
(5) make certifications and reports from time to time;
(6) seek designation by the United States secretary of
transportation as an agent to conduct safety inspections of
interstate gas pipeline facilities located in this state; and
(7) by rule take any other requisite action in
accordance with 49 U.S.C. Section 60101 et seq., or a succeeding
law.
SECTION 22. The following provisions of the Natural
Resources Code are repealed:
(1) the heading to Section 91.1135; and
(2) Sections 91.1135(a), (b), (c), (d), (f), and (g).
SECTION 23. (a) On the effective date of this Act:
(1) the alternative fuels research and education fund
is abolished;
(2) any money remaining in the alternative fuels
research and education fund is transferred to the oil and gas
regulation and cleanup fund;
(3) any claim against the alternative fuels research
and education fund is transferred to the oil and gas regulation and
cleanup fund; and
(4) any amount required to be deposited to the credit
of the alternative fuels research and education fund shall be
deposited to the credit of the oil and gas regulation and cleanup
fund.
(b) Any money transferred from the alternative fuels
research and education fund to the oil and gas regulation and
cleanup fund that was deposited in the alternative fuels research
and education fund as a gift, grant, or other form of assistance
under Subchapter I, Chapter 113, Natural Resources Code, and is
encumbered by the specific terms of the gift, grant, or other form
of assistance may be spent only in accordance with the terms of the
gift, grant, or other form of assistance.
SECTION 24. On the effective date of this Act, the name of
the Railroad Commission of Texas is changed to the Texas Energy
Commission. The change of the agency's name does not affect:
(1) the agency's powers, duties, rights, or
obligations;
(2) the agency's personnel, equipment, data,
documents, facilities, contracts, items, other property,
appropriations, rules, or decisions;
(3) a proceeding of or involving the agency under the
name of the Railroad Commission of Texas; or
(4) the terms of the chairman or other members of the
governing body of the agency.
SECTION 25. This Act takes effect September 1, 2013.