The Texas Real Estate Commission (TREC) adopts amendments to §535.223, concerning Standard Inspection Report Form, with changes to the proposal as published in the February 27, 2015, issue of the Texas Register (40 TexReg 883). The adopted amendment adds a clarifying change to the language to be included on the standard form, Property Inspection Report Form REI 7-5, as adopted by reference.

The amendments are recommended by the Texas Real Estate Inspector Advisory Committee (TREIC) to notify consumers about potential hazards regarding lack of bonding on gas piping, including corrugated stainless steel tubing (CSST), by adding language to the "Consumer Notice Concerning Hazards or Deficiencies" section, and to adopt by reference changes to the standard form, Property Inspection Report Form REI 7-5, approved by the Commission for use in reporting inspection results.

The additional language originally proposed by TREIC was: "lack of bonding on corrugated stainless steel tubing (CSST) or other metal gas tubing or piping where required."

TREIC received comments on the proposed language from nine discrete commenters, including comments from two inspector trade associations and one non-industry trade association. While many commenters agreed that providing notice to consumers regarding potential hazards with improper bonding of CSST or other metal gas tubing was helpful, commenters differed on the appropriate language to be included on the standard inspection form. One commenter suggested that the proposed language would be confusing for inspectors. Another commenter suggested inserting the phrase "yellow jacketed" before "corrugated stainless steel tubing (CSST)." Another commenter suggested revising the language to "lack of additional bonding on corrugated stainless steel tubing (CSST) for gas piping." Another commenter questioned the addition of language regarding potential hazards with CSST, but not other potential safety hazards. Two commenters suggested contacting the Electrical Division of the Texas Department of Licensing and Regulation for their input. One commenter suggested contacting the Texas State Board of Plumbing Examiners for their input.

Four commenters suggested that inspectors should give notice recommending consumers to have additional professional inspections if CSST is identified in an inspection report. One commenter recommended adding a disclaimer regarding the inspection of CSST that would automatically suggest further evaluation by a licensed electrician. A second commenter suggested having inspectors recommend consumers contact a manufacturer-approved installer or licensed electrician to ensure that CSST is properly installed and bonded. A third commenter asked inspectors to encourage homeowners to seek out a licensed electrician to evaluate CSST. And a fourth commenter suggested inspectors should notify consumers to have both a licensed electrician and a licensed plumber evaluate CSST for proper installation and bonding.

TREIC considered these comments at its meeting on April 13, 2015, and recommends the Commission adopt the rule as published with a clarifying change to the language to be included on the standard form, Property Inspection Report Form REI 7-5, as follows: "lack of bonding on gas piping, including corrugated stainless steel (CSST)."

In addition to the comments received by TREIC, the Commission received comments from nine discrete commenters at its meeting on May 4, 2015. Five of these commenters re-emphasized their original comments that were previously submitted to the TREIC. Of the four remaining commenters, three were opposed to the additional language being added to the standard inspection report form, and one was neutral.

After considering all of the comments presented to the TREIC and the Commission, the Commission adopts the rule, including the clarifying change to the language to be included on the standard form, Property Inspection Report Form REI 7-5, as recommended by the TREIC.

The revision to the proposed language to be included on the standard form does not change the nature or scope so much that the rule as adopted could be deemed a different rule. The rule as adopted does not affect individuals other than those contemplated by the rule as proposed. The rule as adopted does not impose more onerous requirements than the proposed rule.

These amendments are effective September 1, 2015.

The amendments are adopted under Texas Occupations Code, §1101.151, which authorizes the Texas Real Estate Commission to adopt and enforce rules necessary to administer Chapters 1101 and 1102; and to establish standards of conduct and ethics for its license holders to fulfill the purposes of Chapters 1101 and 1102 and ensure compliance with Chapters 1101 and 1102.

The statutes affected by the amendments are Texas Occupations Code, Chapter 1102. No other statute, code or article is affected by the amendments.