The Texas Appraiser Licensing and Certification Board (TALCB) adopts new 22 TAC Chapter 157, Subchapter E, Alternative Dispute Resolution as follows: §157.30, Alternative Dispute Resolution; §157.31, Investigative Conference; §157.32, Negotiated Settlement; §157.33, Mediation; §157.36, Stipulations; §157.37, Agreements; and §157.38, Confidentiality. Sections 157.30 - 157.33 and 157.37 are adopted with nonsubstantive changes to the proposed text as published in the June 7, 2013, issue of the Texas Register (38 TexReg 3474) and will be republished. Section 157.36 and §157.38 are adopted without changes.

The difference between the rule as proposed and adopted are: (A) the term "informal conference" has been replaced with the term "investigative conference" wherever it appeared in the text as it was determined to be a better description of the conference; (B) in §157.31: (1) the phrase "or other advocate" was added after the word "attorney" in subsection (b) to make it clear that respondents can bring any parties they want to the conference; (2) in subsection (e), the word "staff" was added between "Board" and "may" to clarify that it is Board staff who may propose a settlement; (C) in §157.33(c) and §157.37(a), the phrase "at their next Board meeting" was deleted so as to not limit the time for final approval by the Board. These changes were made in response to comments received. The new rules are adopted to clearly set out TALCB's policy and procedures for alternative dispute resolution.

The revisions to the rules as adopted do not change the nature or scope so much that they could be deemed different rules. The rules as adopted do not affect individuals other than those contemplated by the rules as proposed. The rules as adopted do not impose more onerous requirements than the proposed rules.

Comments were received from an industry association and an individual appraiser. Both comment letters raised the same points. They supported all of the new rules but made some clarifying suggestions to §157.31. They recommended that the phrase "respondent's choice of another professional representative" be added to the parties permitted to attend an informal conference and that all informal conferences be recorded and made available to all parties. Their reasoning for the latter was that information discussed during an informal conference, although possibly not admissible in future litigation actions, is "essential and necessary for both respondent and enforcement staff when preparing for litigation or if a disagreement arose regarding a settlement." Finally, they recommended that the language regarding settlement offers and dismissal be clarified to reflect that the Director of Standards and Enforcement makes the recommendations but that the Board approves them.

The Board agrees to clarify the language in the rule to reflect that other parties may attend the investigative conferences. This has always been allowed and respondents can consult with or get advice from such other parties at any time. The Board does not agree that investigative conferences should be recorded. The Board feels that recording the conference raises too many issues due to the quasi-judicial nature of the conference and the potential of conflict with or abuse of the confidentiality requirements of alternative dispute resolution methods and administrative practice rules for settlement conferences. The Board does agree with the comment regarding clarification of the roles of Board staff and the full Board in connection with final approval and has revised the rules accordingly.

The reasoned justification for the new rules is greater clarity and transparency about the alternative dispute resolution methods available to respondents who have had a complaint filed against them.

The new rules are adopted under Texas Occupations Code, §1103.151 and §1104.051, which authorize the Texas Appraiser Licensing and Certification Board to adopt rules necessary for certifying or licensing an appraiser and administering the provisions of Chapter 1104 regarding appraisal management companies and §1103.512, regarding Record of Proceedings.

The statutes affected by these new rules are Texas Occupations Code, Chapters 1103 and 1104. No other statute, code or article is affected by the new rules.