Bill Text: TX SB1231 | 2011-2012 | 82nd Legislature | Comm Sub

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Bill Title: Relating to the regulation of health spas by the secretary of state.

Spectrum: Partisan Bill (Republican 2-0)

Status: (Passed) 2011-06-17 - Effective on 9/1/11 [SB1231 Detail]

Download: Texas-2011-SB1231-Comm_Sub.html

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By: Estes S.B. No. 1231
(In the Senate - Filed March 7, 2011; March 16, 2011, read
first time and referred to Committee on Business and Commerce;
April 26, 2011, reported favorably by the following vote: Yeas 9,
Nays 0; April 26, 2011, sent to printer.)

A BILL TO BE ENTITLED
AN ACT
relating to the regulation of health spas by the secretary of state.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 702.155, Occupations Code, is amended to
read as follows:
Sec. 702.155. DURATION OF SECURITY. A certificate holder
shall maintain the security filed or posted under Section 702.151
in effect until the earlier [later] of:
(1) the second anniversary of the date the certificate
holder's health spa closes; or
(2) the date the secretary of state determines that
each claim filed against the security has been satisfied or
foreclosed by law.
SECTION 2. Section 702.156, Occupations Code, is amended to
read as follows:
Sec. 702.156. NOTICE OF CANCELLATION OF SECURITY. [(a)] A
surety or obligor of security filed or posted under this subchapter
shall provide to the secretary of state, not later than the 60th day
before the date the security is canceled, written notice of the
cancellation.
[(b) If the security filed or posted under this subchapter
by a certificate holder is canceled, the secretary of state shall:
[(1) suspend the certificate holder's certificate of
registration on the date of cancellation; and
[(2) maintain other security on file with the
secretary until the later of:
[(A) the second anniversary of the date the
certificate holder's health spa closes; or
[(B) the date the secretary determines that each
claim filed against the security has been satisfied or foreclosed
by law.]
SECTION 3. Section 702.207, Occupations Code, is amended to
read as follows:
Sec. 702.207. DENIAL AND REVOCATION OF EXEMPTION. After
notice and opportunity for hearing, the secretary of state may deny
an application for an exemption or permanently revoke a certificate
holder's certificate of exemption if the secretary finds that the
applicant or certificate holder:
(1) provided false information on the application for
an exemption; or
(2) is no longer eligible for an exemption.
SECTION 4. Section 702.251, Occupations Code, is amended to
read as follows:
Sec. 702.251. FILING OF SECURITY CLAIM. A member may file a
claim against the security filed or posted under this subchapter by
providing [sending] to the secretary of state [by certified mail] a
copy of the contract between the member and certificate holder who
filed or posted the security, accompanied by proof of payment made
under the contract, if the certificate holder's health spa:
(1) closes and fails to provide alternative facilities
not more than 10 miles from the location of the health spa; or
(2) relocates more than 10 miles from its location
preceding the relocation.
SECTION 5. Section 702.254, Occupations Code, is amended to
read as follows:
Sec. 702.254. CLAIM BARRED. The secretary of state may not
consider a claim filed under Section 702.251 if the claim is
received later than the 90th day after the date notice of the
closure or relocation is first posted on the secretary of state's
Internet website under Section 702.452(c) [702.452].
SECTION 6. Subsection (a), Section 702.304, Occupations
Code, is amended to read as follows:
(a) Except as provided by Subsection (b), a contract must
state in at least 10-point type that is boldfaced, capitalized,
underlined, or otherwise conspicuously distinguished from
surrounding written material:
(1) "NOTICE TO PURCHASER: DO NOT SIGN THIS CONTRACT
UNTIL YOU READ IT OR IF IT CONTAINS BLANK SPACES."
(2) "IF YOU DECIDE YOU DO NOT WISH TO REMAIN A MEMBER
OF THIS HEALTH SPA, YOU MAY CANCEL THIS CONTRACT BY MAILING TO THE
HEALTH SPA BY MIDNIGHT OF THE THIRD BUSINESS DAY AFTER THE DAY YOU
SIGN THIS CONTRACT A NOTICE STATING YOUR DESIRE TO CANCEL THIS
CONTRACT. THE WRITTEN NOTICE MUST BE MAILED BY CERTIFIED MAIL TO
THE FOLLOWING ADDRESS:
(Address of the health spa home office)."
(3) "IF THE HEALTH SPA GOES OUT OF BUSINESS AND DOES
NOT PROVIDE FACILITIES WITHIN 10 MILES OF THE FACILITY IN WHICH YOU
ARE ENROLLED OR IF THE HEALTH SPA MOVES MORE THAN 10 MILES FROM THE
FACILITY IN WHICH YOU ARE ENROLLED, YOU MAY:
(A) CANCEL THIS CONTRACT BY MAILING BY CERTIFIED
MAIL A WRITTEN NOTICE STATING YOUR DESIRE TO CANCEL THIS CONTRACT,
ACCOMPANIED BY PROOF OF PAYMENT ON THE CONTRACT TO THE HEALTH SPA AT
THE FOLLOWING ADDRESS:
(Address of the health spa home office); AND
(B) FILE A CLAIM FOR A REFUND OF YOUR UNUSED
MEMBERSHIP FEES AGAINST THE BOND OR OTHER SECURITY POSTED BY THE
HEALTH SPA WITH THE TEXAS SECRETARY OF STATE. TO MAKE A CLAIM
AGAINST THE SECURITY PROVIDE [SEND] A COPY OF YOUR CONTRACT
TOGETHER WITH PROOF OF PAYMENTS MADE ON THE CONTRACT TO THE TEXAS
SECRETARY OF STATE. THE REQUIRED CLAIM INFORMATION [WRITTEN
NOTICE] MUST BE RECEIVED BY [MAILED BY CERTIFIED MAIL TO] THE
SECRETARY OF STATE NOT LATER THAN THE 90TH DAY AFTER THE DATE NOTICE
OF THE CLOSURE OR RELOCATION IS FIRST POSTED ON THE SECRETARY OF
STATE'S INTERNET WEBSITE [FOLLOWING ADDRESS:
OFFICE OF THE SECRETARY OF STATE
STATUTORY DOCUMENTS SECTION
P.O. BOX 12887
AUSTIN, TEXAS 78711-2887]."
(4) "IF YOU DIE OR BECOME TOTALLY AND PERMANENTLY
DISABLED AFTER THE DATE THIS CONTRACT TAKES EFFECT, YOU OR YOUR
ESTATE MAY CANCEL THIS CONTRACT AND RECEIVE A PARTIAL REFUND OF YOUR
UNUSED MEMBERSHIP FEE BY MAILING A NOTICE TO THE HEALTH SPA STATING
YOUR DESIRE TO CANCEL THIS CONTRACT. THE HEALTH SPA MAY REQUIRE
PROOF OF DISABILITY OR DEATH. THE WRITTEN NOTICE MUST BE MAILED BY
CERTIFIED MAIL TO THE FOLLOWING ADDRESS:
(Address of the health spa home office)."
SECTION 7. Sections 702.451 and 702.452, Occupations Code,
are amended to read as follows:
Sec. 702.451. DISCIPLINARY ACTIONS. (a) After notice and
opportunity for hearing, the secretary of state may deny an
application for a certificate of registration, or may permanently
revoke [or suspend for a definite period] a health spa operator's
certificate of registration, on a finding by the secretary that the
applicant or certificate holder:
(1) provided false information on an application or
other document filed with the secretary;
(2) failed to file or post, or maintain, the security
for each health spa location as required by Subchapter D; or
(3) failed to provide the contract disclosure language
required by Subchapter G.
(b) The secretary of state may permanently revoke a
certificate of registration under Subsection (a) based on the
certificate holder's failure to maintain the required security only
after a finding by the secretary that, within the 30-day period
following the cancellation or lapse of the security, the
certificate holder failed to file or post replacement security in
the required amount.
Sec. 702.452. NOTICE REQUIREMENT BEFORE HEALTH SPA CLOSING.
(a) At least 30 days before the date a health spa is scheduled to
close or relocate, the certificate holder shall contemporaneously:
(1) post, inside and outside each entrance to the
health spa, a notice stating:
(A) the date the health spa is scheduled to close
or relocate;
(B) that a member of the health spa may, not later
than the 90th day after the date notice of the closure or relocation
is first posted on the secretary of state's Internet website [the
health spa closes or relocates], file with the secretary of state a
claim to recover actual financial loss suffered by the member as a
result of the health spa closing; and
(C) the procedures for perfecting a security
claim; and
(2) notify the secretary of state in writing of the
health spa closing or relocation and the date that the notice was
first posted.
(b) The notice posted under Subsection (a)(1) must be:
(1) at least 8-1/2 by 11 inches in size; and
(2) posted continuously for at least 30 days.
(c) [If the certificate holder fails to post the notice
required by Subsection (a)(1) within the time specified, the
secretary of state, not later than the 30th day after the date the
secretary discovers that a health spa is closed, shall post the
notice required under Subsection (a)(1).
[(d)] After receiving a notice under Subsection (a)(2) or
otherwise discovering that a health spa is closed, the secretary of
state shall post on the secretary of state's Internet website a
notice containing the information specified in Subsection (a)(1).
The notice must be posted continuously for at least 30 days.
(d) [(e)] The secretary of state shall, not later than the
10th day after the date the secretary receives notice or otherwise
discovers that a health spa is closed, notify the appropriate
surety company or obligor of the administrative proceedings pending
under Subsection (a)(1).
(e) [(f)] The notice required under Subsection (a) is not
required in the case of a fire, flood, or act of God that is not
within the reasonable control of a health spa.
SECTION 8. (a) The changes in law made by this Act to
Sections 702.155 and 702.156, Occupations Code, apply to security
that is filed or posted before, on, or after the effective date of
this Act.
(b) The change in law made by this Act to Section 702.207,
Occupations Code, applies only to an application for exemption that
is filed or to the revocation of a certificate of exemption that
occurs on or after the effective date of this Act. An application
for exemption filed or the revocation of a certificate that occurs
before the effective date of this Act is governed by the law in
effect immediately before that date, and the former law is
continued in effect for that purpose.
(c) The changes in law made by this Act to Sections 702.251
and 702.254, Occupations Code, apply only to a claim against
security that is received by the secretary of state on or after the
effective date of this Act. A claim against security received by
the secretary of state before the effective date of this Act is
governed by the law in effect immediately before that date, and the
former law is continued in effect for that purpose.
(d) The change in law made by this Act to Section 702.304,
Occupations Code, applies only to a contract that is entered into on
or after the effective date of this Act. A contract entered into
before the effective date of this Act is governed by the law in
effect immediately before that date, and the former law is
continued in effect for that purpose.
(e) The change in law made by this Act to Section 702.451,
Occupations Code, applies to a disciplinary action taken on or
after the effective date of this Act. A disciplinary action taken
before the effective date of this Act is governed by the law in
effect immediately before that date, and the former law is
continued in effect for that purpose.
(f) The change in law made by this Act to Section 702.452,
Occupations Code, applies to the closing or relocation of a health
spa that occurs on or after the effective date of this Act. A
closing or relocation of a health spa that occurs before the
effective date of this Act is governed by the law in effect
immediately before that date, and the former law is continued in
effect for that purpose.
SECTION 9. This Act takes effect September 1, 2011.
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