(a) For purposes of this section, a temporary change
of ownership license is a temporary license issued to an applicant
who proposes to become the new operator of a center that exists on
the date the application is submitted.
(b) A center license is not assignable or transferable.
The applicant (new license holder) must obtain a temporary change
of ownership license followed by an initial three-year license in
accordance with this section. When the Texas Health and Human Services
Commission (HHSC) approves the change of ownership by issuing a temporary
change of ownership license to the new license holder, the current
license holder's license becomes invalid as of the effective date
of the change of ownership indicated in the application. Between the
effective date of the change of ownership and the issuance of the
temporary change of ownership license, the current license holder
remains responsible under its license; however, the applicant may
operate a center on behalf of the current license holder during such
period of time.
(c) An applicant must submit to HHSC through the online
portal:
(1) a complete application for a license in accordance
with HHSC instructions and §550.101 of this subchapter (relating
to Criteria and Eligibility for a License) or an incomplete application
with a letter explaining the circumstances that prevented the inclusion
of the missing information;
(2) the application fee, in accordance with §550.112
of this subchapter (relating to Licensing Fees);
(3) a letter of credit for $250,000 from a bank that
is insured by the Federal Deposit Insurance Corporation, or other
documentation acceptable to HHSC, to demonstrate the applicant's financial
viability; and
(4) a signed and notarized Change of Ownership Transfer
Affidavit HHSC Form 1092 from the applicant and the center's current
license holder of intent to transfer operation of the center from
the current license holder to the applicant, beginning on the change
of ownership effective date specified on the change of ownership application.
(d) HHSC may deny issuance of a license if the applicant,
a controlling person, or any person disclosed in the application fails
to meet the criteria for a license established in §550.101 of
this subchapter or for any reason specified in §550.115 of this
subchapter (relating to Criteria for Denial of a License).
(e) To avoid a center operating without a license,
an applicant must submit all items in subsection (c) of this section
at least 30 days before the anticipated date of the change of ownership
in accordance with HHSC instructions, unless the 30-day notice requirement
is waived in accordance with subsection (f) of this section.
(f) HHSC may waive the 30-day notice required by subsection
(e) of this section if:
(1) the applicant presents evidence to HHSC demonstrating
that an eviction of the center or a foreclosure of the property from
which the center operates is imminent and that circumstance prevented
the timely submission of the items specified in subsection (c) of
this section; or
(2) HHSC, in its sole discretion, determines that circumstances
are present that threaten a minor's health, safety, or welfare and
necessitate waiver of timely submission of the items specified in
subsection (c) of this section.
(g) Upon HHSC approval of the items specified in subsection
(c) of this section, HHSC issues a temporary change of ownership license
to the applicant if HHSC finds that the applicant, all controlling
persons, and all persons disclosed in the application satisfy the
requirements in §§550.101(a) and (f) of this subchapter,
550.104 of this subchapter (relating to Applicant Disclosure Requirements),
and 550.115 of this subchapter.
(1) The issuance of a temporary change of ownership
license constitutes HHSC's official written notice to the facility
of the approval of the application for a change of ownership.
(2) The effective date of the temporary change of ownership
license is the date requested in the application and cannot precede
the date the application is received by HHSC through the online portal.
(h) A temporary change of ownership license expires
on the earlier of:
(1) 90 days after its effective date or the last day
of any extension HHSC provides in accordance with subsection (i) of
this section; or
(2) the date HHSC issues a three-year license in accordance
with subsection (l) of this section.
(i) HHSC, in its sole discretion, may extend the term
of a temporary change of ownership license by 90 days based upon extenuating
circumstances.
(j) HHSC conducts an on-site health inspection to verify
compliance with the licensure requirements after issuing a temporary
change of ownership license. HHSC may conduct a desk review instead
of an on-site health inspection after issuing a temporary change of
ownership license if:
(1) less than 50 percent of the direct or indirect
ownership interest in the former license holder changed, when compared
to the new license holder; or
(2) every person with a disclosable interest in the
new license holder had a disclosable interest in the former license
holder.
(k) HHSC, in its sole discretion, may conduct an on-site
Life Safety Code inspection after issuing a temporary change of ownership
license.
(l) If an applicant and all other persons disclosed
in the application satisfy the requirements of §§550.101(a)
and (f), 550.104, and 550.115 of this subchapter for a license, and
the center passes the change of ownership health inspection as described
in subsection (j) of this section, HHSC issues a three-year license.
The effective date of the three-year license is the same date as the
effective date of the change of ownership and cannot precede the date
the application was received through the online portal.
(m) If a license holder changes its name but does not
undergo a change of ownership, the license holder must notify HHSC
and submit documentation evidencing a legal name change by submitting
an application through the online portal. On receipt of the notice
and documentation, HHSC reissues the current license in the license
holder's new name.
(n) If a license holder adds an owner with a disclosable
interest, but the license holder does not undergo a change of ownership,
the license holder must notify HHSC of the addition no later than
30 days after the addition of the owner by submitting an application
through the online portal.
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Source Note: The provisions of this §550.108 adopted to be effective September 1, 2014, 39 TexReg 6569; amended to be effective October 11, 2017, 42 TexReg 5492; amended to be effective October 29, 2018, 43 TexReg 7188; transferred effective May 1, 2019, as published in the Texas Register April 12, 2019, 44 TexReg 1875; amended to be effective October 11, 2022, 47 TexRg 6588 |