The Texas Real Estate Commission (TREC) adopts amendments to 22 TAC §§535.1, 535.3-535.5, 535.20, 535.31, 535.33, 535.34, 535.43, 535.45, 535.50-535.53, 535.57, 535.58, 535.60, 535.61, 535.63, 535.65-535.67, 535.71, 535.72, 535.74, 535.75, 535.82, 535.121, 535.122, 535.133, 535.141, 535.147, 535.148, 535.208-535.210, 535.213, 535.214, 535.218-535.220, 535.224, 535.400-535.405 and new 535.120 in Chapter 535, General Provisions, without changes, as published in the March 3, 2023, issue of the Texas Register (48 TexReg 1216) and will not be republished.

First, the changes to §535.218(f) serve to extend the amount of time an instructor of a ride-along inspection course can provide a certificate of course completion to receive continuing education credit. Now, such instructors can provide documentation within the instructor's current license period for a course taught within that same term. The changes were recommended by the Texas Real Estate Inspector Committee.

The remainder of the amendments to Chapter 535 are made as a result of the Commission's quadrennial rule review. The changes update terminology for consistency and clarity throughout the chapter. Additionally, the following changes are being made:

-Subsections (a) of 22 TAC §§535.51, 535.208, and 535.400 are being amended to correct a typographical error in the subsection.

-In 22 TAC §535.52(b)(4), the term "denial" is added to better reflect current agency practice.

-The change in subsection (j)(1) of §535.65 is made to account for the agency's updated education reporting system, whereby providers can post course credit on behalf of certain students.

-The changes to 22 TAC §535.57 are being made to better reflect current contractual provisions.

-In 22 TAC §535.58 and §535.133, changes are made to remove references to residency requirements, which were removed from Chapter 1101, Texas Occupations Code, as a result of the agency's most recent Sunset review.

-The removal of the venue provision in subsections (j)(2) of 22 TAC §535.61, (b)(5) of §535.67, and (e)(2) of §535.71 is made to be consistent with current State Office of Administrative Hearing processes.

-The changes to 22 TAC §§535.63, 535.72, 535.74, 535.214, and 535.218 are being made to reflect the fact that in 2021, a new eight-hour non-elective course, the Inspector Legal and Ethics and Standards of Practice Review replaced the two four-hour courses in 2021.

-The changes to 22 TAC §535.213 are also being made to streamline the rule. The topics and units will continue to be listed in the forms adopted by reference.

-The additions to 22 TAC §535.65 are being made to clarify the timing requirements for execution of pre-enrollment agreements and certain distance education delivery requirements for providers. The change to subsection (i)(2) corrects a rule reference.

-The change in 22 TAC §535.66(c)(1) is made to reflect current course approval practice by the Texas Higher Education Coordinating Board.

-In 22 TAC 535.67(c) and (d), the time period is being changed from 15 to 14 days to be more consistent with other similar rules.

-The removal of the term "author" in 22 TAC §535.72(h)(1)(B) is being made because the agency is the author of these courses.

-The changes to 22 TAC §535.75(d) clarify that a provider is not prohibited from providing a course completion certificate to a student.

-New 22 TAC §535.120 makes clear that a license holder cannot engage in real estate brokerage activity while on inactive status. Although this is currently prohibited by statute, there was no corresponding, discrete rule.

-The changes to §535.141 are made to better track Chapter 1101, Occupations Code, and to better reflect the potential for consumer harm. The change in now subsection (c)(2)(D) corrects a rule reference. Finally, subsection (i) is removed to more appropriately reflect agency practice and jurisdiction.

-Subsections (f) and (g) of 22 TAC §535.148, as well as the form adopted by reference, are amended to reflect updated terminology used by the Texas Department of Licensing and Regulation.

-The repeal of certain language in §535.209 and §535.213 reflects the expiration of those sections by rule.

-The repeal of subsection (c) in 22 TAC §535.218 is the result of duplicative language. -Subsection (d)(1) is removed to account for the scenario whereby an inspector renews the inspector's license after the license's expiration date.

-The changes to 22 TAC §535.219 correct a reference to another rule.

-The changes to 22 TAC §535.224 more fully cite the applicable rules.

One comment was received for §535.4 asking TREC to examine the practice of wholesaling as unlicensed activity. One comment was received for §535.5, which was commentary on other topics related to the real estate industry and unrelated to the proposed changes. One comment was received for §535.51, which was commentary related to education hours required for a license and unrelated to the proposed changes. The Commission declined to make changes based on the comments received.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.