The Finance Commission of Texas (the commission) adopts new §26.2, concerning recordkeeping requirements for perpetual care cemeteries. New §26.2 is being adopted with nonsubstantive changes to the proposal as published in the March 8, 2002 issue of the Texas Register (27 TexReg 1609). The text of new §26.2 will be republished.

New §26.2 requires perpetual care cemeteries to maintain records that were previously recommended to be maintained under Texas Department of Banking Policy Memorandum No. 1013 (November 25, 1996). The new section is being adopted to appropriately formalize Policy Memorandum No. 1013 as a rule promulgated under Health & Safety Code, §712.008. New §26.2 also requires perpetual care cemeteries to maintain records relating to consumer complaints. These records are necessary to examine consumer complaint files in accordance with Health & Safety Code, §712.044(a).

New §26.2 will require perpetual care cemeteries to keep a general file that includes records such as documents and correspondence relating to perpetual care operations, financial information, sample forms of agreements, trustee or bank statements, corporate information, and other documents required to be maintained by provisions of Health & Safety Code, Chapters 711 and 712. It will also require perpetual care cemeteries to keep consumer complaint files, purchase agreement or property location files, a historical register of all interment rights sold, and a monthly recapitulation of all conveyances of interment rights issued subsequent to an examination. Finally, new §26.2 will require that records be kept at the cemetery or corporate office. If these locations are not conducive to examination, the proposed section authorizes the banking department to examine the records at another more suitable location.

The commission received three comments. One commenter objected to the provision in the rule authorizing the banking department to request delivery of the records to a more suitable location if the cemetery or corporate office is not suitable for examination purposes. The commenter stated that he could not operate without the records. The commission made no changes based on the comment because the records will be at the alternative location for only a short period of time, usually three to four days. In addition, the cemetery will have access to the records or the department will provide the cemetery with any requested information in the records while they are located off-site. Another commenter advised that the documents required to be maintained in separate property purchaser files under proposed §26.3(b)(3) are kept by some cemeteries in files identified by property location. The commenter suggested authorization of property location files as an alternative to purchaser files because the expense of converting these files to a system based on property purchasers would be substantial. The commission agreed with alternative and added it to the proposed provision. Another commenter requested that the commission address the applicability of the rule to historical records. The commenter stated that there will be no problem maintaining the required records on a prospective basis; however, to provide all required information for records going back more than a century would be onerous. The commission added subsection (d) to §26.2 to address the comment and clarify that the provision's recordkeeping requirements are prospective.

Two nonsubstantive changes were also made to clarify the proposed rule. The first was to subsection (b)(1)(L) to clarify that the sales maps showing all gardens, mausoleums, crematories, and columbaria will also show the sold and unsold spaces within those gardens, mausoleums, crematories, and columbaria. The second change was to subsection (c)(2). The proposed provision required a perpetual care cemetery to deliver records to a mutually agreeable location if the location of the records was not suitable for examination by banking department personnel. The change clarifies that the banking department can pick up the records at the cemetery and deliver them to the examination location rather than requiring the cemetery to physically deliver them.

The section is adopted under Health & Safety Code, §712.008, which authorizes the commission to adopt rules necessary to enforce and administer Health & Safety Code, Chapter 712.