5100 Waivers and Variances

September 2010

 

Waivers and variances are tools to assist child care providers to comply with standards within a specified period of time, without compromising the safety of children served by the operation.

Evaluating Risk

A waiver or variance is not an entitlement. Staff must evaluate the risk to children before granting approval for a waiver or variance. A waiver or variance may not be granted if child safety would be negatively impacted. When granting a waiver or variance, conditions must be put into place to ensure that children are not at risk.

Determining the Appropriate Action

A waiver may be appropriate if the economic impact of compliance is great enough to make compliance impractical.

A variance may be appropriate if there is good and just cause for the applicant or operation to meet the purpose of the standard in a different way.

A waiver or variance may only be granted for a specified period of time, and expires on the date specified in the Child Care Licensing Automation Support System (CLASS) that has been approved by the supervisor.

Obtaining Supervisory Approval

Supervisors grant or deny waivers or variances, and base decisions on:

  • the risk to children;
  • relevant compliance history;
  • waivers or variances currently in effect;
  • status (for example, whether on initial, evaluation, or probation);
  • economic need and ability to comply; and
  • other variables identified by Licensing.

If a supervisor chooses to delegate decision-making authority, the supervisor must set parameters by which the designee reviews and approves or denies waivers and variances.

Reviewing the Decision to Deny

If denied, the provider may request that the director of Licensing or designee review the decision.

See 5130 Review of Conditions or Denied Request for a Waiver or Variance.

Changing the Conditions or Dates

If the supervisor grants a waiver or variance, but the expiration date varies from the plan submitted by the provider, the supervisor must contact the provider to discuss the changes.

Operations Under the Same Governing Body

District directors or managers may develop policies for their staff to address waivers or variances for multiple operations under the same governing body.

For Child Day Care Only

A child day care provider does not need to submit a waiver or variance request if the provider can come into compliance with the standard within 60 days. This does not mean a waiver or variance must be submitted if the violation exceeds 60 days; however, the operation will continue to be in violation until the correction is made or a waiver or variance is approved. Staff must consider the risk to the children and all variables listed in this item under Obtaining Supervisory Approval.

Texas Human Resources Code §§42.042(j); 42.048(c)

40 TAC §§745.8301; 745.8305; 745.8307

Processing a Waiver or Variance

Procedure

A provider who applies for a waiver or variance:

  • completes page 1 of Form 2937 Child Care Licensing Waiver/Variance Request; and
  • sends the request, a letter, and any supporting documentation to Licensing; or
  • submits the request online through the provider's online Child Care Licensing Account; and
  • sends supporting documentation to Licensing, as needed.

Letters requesting a waiver or variance must include all of the information required on Page 1 of Form 2937. A separate request must be submitted for each operation type and standard number.

Within 15 days of receipt of the completed waiver or variance form, the inspector:

  • evaluates the request; and
  • documents the request in CLASS and makes a recommendation to the supervisor whether to grant or deny the request. If the inspector recommends granting the request, the inspector documents conditions for supervisory review and approval. If the inspector recommends denial of the request but the supervisor disagrees, the inspector adds conditions to the waiver or variance.

The supervisor reviews the request and the inspector's recommendation and makes the final decision to grant or deny the request within 15 days of receiving the notification. The inspector then must do the following:

  • If the decision is made to grant the waiver or variance, send the provider notice of the decision using page 2 of CLASS Form 2937, which must indicate the time limits and conditions; or
  • If the decision is made to deny the waiver or variance, send the provider notification of the decision using CLASS Form 2937 by certified mail, and include the reason for denial; and
  • If the request is denied, include a statement about the provider’s right to a review by the director of Licensing or designee within 15 days of receiving notice of the denial.

 

5110 Decision Guidelines for Granting Waivers or Variances

September 2010

 

The inspector only grants a waiver or variance when it is appropriate and when doing so does not negatively impact child safety. Operations with poor compliance history relevant to the request are not granted a waiver or variance.

Procedure

When deciding whether to grant or deny a request, the inspector considers the following:

  • Is the request reasonable?
  • Can the operation comply with the standard without a waiver or variance?
  • What are the risk variables at the operation?
  • What other waivers or variances are in effect or have been in effect at the operation?
  • What is the operation's compliance history?
  • When was the last inspection at the operation?
  • Does an inspection need to be made before making the decision?
  • How will the waiver or variance impact the children in care?
  • Will granting this request negatively impact child safety?
  • Is the length of time requested for the waiver or variance reasonable?
  • Is a shorter time for the waiver or variance more appropriate?

See:

Appendix 5000-1A: Guidance on Reviewing Day Care Waiver or Variance Requests

Appendix 5000-1B: Guidance on Reviewing Residential Child Care Waiver or Variance Requests

 

5120 Setting and Monitoring Conditions for the Waiver or Variance

November 2009

 

Conditions must be set for all waivers and variances granted. Each condition established for waivers or variances must specify the month, day, and year the waiver or variance expires.

All conditions must be easily observable and measurable by staff and the caregiver:

  • Conditions must not re-state the minimum standard rules, but rather must describe specific circumstances that the operation must address. Conditions are another way of achieving compliance with minimum standard rules and reducing risk to children.
  • Conditions must be evaluated during each inspection and during each investigation relevant to the standard and the conditions.

Procedure

Conditions are not limited to, but may include:

  • that the request applies to a specific child or caregiver;
  • measures the provider must take to reduce risk and protect the children;
  • steps the provider must take toward meeting the standard;
  • any dates when Licensing requires supporting documentation from the provider;
  • documentation or other observable items that must be available at the operation;
  • other restrictions or requirements placed on the operation.

The Licensing representative ensures that:

  • waiver or variance expiration dates are reasonable and based upon the risk to children; 
  • no waiver or variance is granted for more than three years;
  • required documents, records, or other observable activity are specified in the conditions so that evaluation of conditions can be recorded on the Licensing inspection form or letter; and
  • documentation is complete, specifically on CLASS Form 2936 in the documentation narrative or the compliance letter, that:
    • conditions of the waiver or variance were reviewed;
    • whether conditions were met or not met;
    • whether conditions changed; or
    • unintended risk to children is observed as a result of the waiver or variance.

See also:

4152 Reviewing Restrictions and Conditions

5140 Rescinding or Amending a Waiver or Variance

 

5121 Documenting Outcomes for Waivers and Variances

June 2016

 

Procedure

Licensing staff completes the Outcome section on the Waiver/Variance Detail page in CLASS when a waiver or variance has expired or it is no longer needed.

 

5130 Review of Conditions or Denied Request for a Waiver or Variance

November 2009

 

If a request for a waiver or variance is denied, the provider may request an administrative review by the director of Licensing or designee.

40 TAC, §745.8319

If a provider disagrees with the conditions or time limits established, he or she may contact the Licensing supervisor to discuss concerns.

40 TAC, §745.8315

Procedure

When a waiver or variance is denied, the inspector informs the provider of the administrative review process: The provider:

  • may request an administrative review of a denied request in writing within 15 days of the receipt of the denial letter;
  • must send a letter to the director of Licensing or designee with additional information that supports the need for waiver or variance; and
  • must include a copy of the denied waiver or variance and forward a copy of the letter requesting the review to the Licensing supervisor.

The supervisor provides a copy of the administrative review request to the assigned inspector. The Director of Licensing or designee:

  • considers the new information;
  • notifies the requester of the decision; and
  • sends a copy of the notification letter to the Licensing inspector and supervisor.

A provider who wants to amend conditions or time limits must call or write to the supervisor and request a meeting to discuss items of concern.

 

5140 Rescinding or Amending a Waiver or Variance

November 2009

 

A waiver or variance that has been previously granted may be rescinded or amended by the Licensing supervisor, a CCL director or manager, based upon:

  • risk to children;
  • changing conditions;
  • conditions not met; or
  • a combination of any of the criteria above.

Procedure

Protocol to Recommend an Action

An authorized person who determines that a waiver or variance should be rescinded or conditions amended must consult with the supervisor regarding a recommended course of action.

Notice by Supervisor of Rescission

The supervisor writes a letter to the provider rescinding the waiver or variance or amending the conditions and sends a copy to the Director of Licensing or designee.

Statement of Provider’s Right to Review

If a waiver or variance is rescinded, the letter must include the provider's right to an administrative review by the Director of Licensing or designee within 15 calendar days. The letter is sent by certified mail.

See also 5130 Review of Conditions or Denied Request for a Waiver or Variance.

 

5200 Fees

February 2013

 

CCL must charge fees for permits and for conducting background checks unless an operation is exempt from such fees. All revenue collected from fees with the exception of the $1 per background check fee is deposited in the state’s general revenue fund.

Human Resources Code §42.0521

 

5210 Types of Fees

February 2013

 

Fees may be charged as follows:

  1. Nonrefundable application fee for initial license
  2. Initial license fee
  3. Annual fee that is due before a license is issued and on the anniversary date of the license
  4. Amendment fee
  5. Nonrefundable application for registration fee and annual registration fee
  6. Nonrefundable application for listing fee and fee for listing
  7. Nonrefundable application fee for a compliance certificate
  8. Fees for criminal history and Central Registry background checks

Human Resources Code §§42.054; 42.056(c); 42.153(c); 42.159(e); 42.203(c); 42.206(e)

40 TAC §745.501

If a permit allows for different capacities at different times of the day, the fee is based on the highest capacity. See 5220 Fee Schedules.

 

5211 Exemptions From Fees

September 28, 2018

 

Licensed Operations

Certified or state-run operations are exempt from application fees, permit fees, and background check fees.

The following types of operations are exempt from paying permit and background check fees; however, they still must pay application fees:

  • Licensed foster family homes and foster group homes
  • Nonprofit operations regulated under Chapter 42 of the Human Resources Code that either:
  • provide 24-hour care for children in the managing conservatorship of DFPS during the 12-month period immediately preceding the anniversary date of the operation’s permit; or
  • provide 24-hour residential care and do not charge for the care provided.

Texas Human Resources Code §42.054(g)

40 TAC §745.503

Listed Family Homes

Listed family homes are exempt from all fees if all of the following conditions are met:

  1. The caregiver provides care to children related to them.
  2. The care is provided in the child’s home.
  3. HHSC has received a Texas Workforce Commission Listed Home Fee Waiver Authorization certificate exempting the provider from paying fees.

A listed family home is not exempt from paying fees if the home meets the above requirements but also provides care to a related or unrelated child in the caregiver’s home.

Texas Human Resources Code §42.054(g)

40 TAC §745.503

Procedure

Licensing staff exempt a listed family home from paying fees after HHSC has received a Texas Workforce Commission (TWC) Listed Home Fee Waiver Authorization certificate exempting the provider from paying fees. The Texas Workforce Commission is responsible for determining whether a listed family home is exempt from fees; therefore, Licensing staff do not need to take any other steps to determine whether the home is exempt from paying fees.

To indicate that a listed home is exempt from paying fees in CLASS, Licensing staff:

  1. Check the TWC Subsidy box under Operation Type and enter the TWC Applied Date on the Registered and Listed Homes Main Operation page.
  2. Select Yes from the Exempt From Operations Fee drop-down box on the Registered and Listed Homes Main Operation page.
  3. Complete a Chronology (type Fees), indicating receipt of the TWC approval form and that the operation is exempt from fees.

If the status of the listed home changes and is no longer exempt from paying fees, then the listed home’s next annual fee is not due until the anniversary of the issuance date the following year.

 

5212 Requesting and Processing Application and Initial Fees

September 28, 2018

 

Before the acceptance of an application for a permit (that is, during the pre-application period), the applicant must pay:

  • an application fee, unless the applicant is exempt from paying an application fee; and
  • the initial license fee, unless the applicant does not receive an initial license or is exempt from paying an initial license fee. See 5211 Exemption From Fees.

If the application is withdrawn or the permit is not issued, the application fee is not refunded. However, the fee for an initial license can be refunded. See 5250 Fee Refund Guidelines.

No new application fee is required if an application is submitted within one month after withdrawal. If the initial license fee was refunded, it must be paid again.

Texas Human Resources Code §42.054

40 TAC §§745.503; 745.509; 745.519

Procedure

During the pre-application period, Licensing staff:

  1. explains the process and requirements for paying fees during the pre-application period;
  2. provides one of the following Child Care Fee Schedules and a fee envelope, depending on the type of operation:
    1. Form 3008 Listed Family Home Fee Schedule
    2. Form 3009 Registered Child Care Home Fee Schedule
    3. Form 3010 Licensed Child Care Fee Schedule
    4. Form 3011 Residential Child Care License Fee Schedule
  3. instructs the applicant to mail a cashier’s check, corporate check, money order, or certified check for the application fee and initial fee if a fee is required, in the fee envelope with the completed fee form to HHSC Accounts Receivable; and
  4. instructs the applicant to mail all other application materials to Licensing staff.

Texas Human Resources Code §42.054

40 TAC §745.517

Before accepting an application, Licensing staff:

  • verifies in CLASS under the Fees tab that the fee was paid, if a fee is required; and
  • documents the date the payment was received and the Document Locator Number (DLN) in a Chronology (type Fees).

See:

2100 Providing Information About Licensing Processes

2110 Conducting the Pre-Application Interview for a Child Care Permit and sub-items

3220 Reviewing and Accepting the Application for a Permit

5211 Exemptions From Fees

5220 Fee Schedules

5260 Verification of Fee Payment

 

5213 Requesting and Processing the First Annual Fee for Licensed Operations

September 28, 2018

 

Before Licensing issues a full license (that is, during the initial period), the operation must pay the first annual fee, unless the applicant is exempt from paying an annual fee.

If the operation fails to pay the fee before the initial license expires, the Licensing inspector denies issuance of the full permit.

See:

5211 Exemptions From Fees

7600 Adverse Actions

Texas Human Resources Code §42.054

40 TAC §745.509

Procedure

After making one or more inspections of the operation during the initial period and having determined that requirements are or will be met for issuance of the full license, Licensing staff:

  1. give the permit holder the appropriate Child Care Fee Schedule (Form 3010 Licensed Child Care Fee Schedule or Form 3011 Residential Child Care License Fee Schedule) and Form 2822, Notice of First Annual Fee;
  2. instruct the permit holder to mail the form and a cashier’s check, corporate check, money order, or certified check for the annual fee, if a fee is required, before the initial license expires, to HHSC Accounts Receivable; and
  3. advise operations to pay the fee at least 30 days before the initial license expires.

Before issuing the full license, Licensing staff:

  • verify in CLASS under the Fees tab that the operation has submitted the first annual fee before the end of the initial period, if the operation is required to pay a fee; and
  • document the date the payment was received and the Document Locator Number (DLN) in a Chronology (type Fees).

If Licensing staff cannot verify that the operation has paid the fee before the initial license expires, he or she denies issuance of the full permit.

See:

5260 Verification of Fee Payment

7633 Notice of Decision to Deny, Revoke, or Suspend an Application or Permit

40 TAC §§745.517 and 745.509

 

5214 Nonpayment of Annual Fees

December 2011

 

If the annual permit fee is not paid by the due date, the permit is automatically suspended.

If the annual permit fee is not paid within six months after the due date, the permit is automatically revoked.

See:

5211 Exemption from Fees

7810 Automatic Suspensions

7820 Automatic Revocations

Texas Human Resources Code §42.054(f)

 

5220 Fee Schedules and Consequences When Fees are Not Paid

September 28, 2018

 

5221 Licensed Operations – Fee Chart

September 28, 2018

 

The chart below lists the fees that are required for a child care operation to obtain or maintain an initial or full license. Child care operations include day care operations, residential operations, and child-placing agencies (CPAs).

Some licensed operations may be exempt from certain fees. See 5211 Exemptions From Fees.

Type and Amount When to Notify Operation When Fee Payment is Due Consequence if an Operation Fails to Meet Time Frames
Application: $35 Inquiry, pre-application, or application Application acceptance date Return application as incomplete
Initial license for a child care operation (other than a CPA): $35 Inquiry, pre-application, or application Application acceptance date Return application as incomplete
Initial license for a CPA: $50 Inquiry, pre-application, or application Application acceptance date Return application as incomplete
Initial renewal for a child care operation (other than a CPA): $35 When the operation is informed that a full license cannot be issued Before renewal Do not renew initial license
Initial renewal for a CPA: $50 When the operation is informed that a full license cannot be issued Before renewal Do not renew initial license
First annual fee for a child care operation (other than a CPA): $35 + $1 per licensed capacity Initial Before issuance of a full license Denial, if the fee is not paid by the issuance date
First annual fee for a CPA: $100 Initial Before issuance of a full license Denial, if fee is not paid by the issuance date
Annual fee for a child care operation (other than a CPA): $35 + $1 per licensed capacity Two months before the anniversary date of the license (state office notifies) Anniversary date of a full license Automatic suspension, if the fee is not paid by the anniversary date

 

Automatic revocation, if the fee is not paid within six months after the automatic suspension begins

Annual fee for a CPA: $100 Two months before the anniversary date of the license (state office notifies) Anniversary date of the full license Automatic suspension, if the fee is not paid by the anniversary date

 

Automatic revocation, if the fee is not paid within six months after the automatic suspension begins

Change of ownership or location (not applicable for a CPA that only changes location): $35 for application
AND
For a child care facility: $35 for initial (only if being issued)
For a CPA (not applicable for a CPA that only changes location) issued
OR
For a child care facility: $35 + $1 per licensed annual capacity
For a CPA (other than a change of location): $100
When notified of the change Application acceptance date and before issuance Denial, if the fee is not paid by the issuance date
Amendment fee for a child care operation: $1 per licensed capacity increase Amendment request Before the amendment is issued No increase in capacity
Background check per person: $2 Not applicable At the time the background check request is submitted or on a monthly or quarterly basis Possible suspension or revocation of the permit

Texas Human Resources Code §§42.054; 42.056(c)

40 TAC §§745.509; 745.517

 

5222 Registered Homes - Fee Chart

September 2016

 

The chart below lists the fees required for a registered child care home.

Fee Type, Amount When to Notify an Operation When Fee Payment is Due Consequence if Operation Fails to Meet Time Frames
Initial application, Registration request: $35 Inquiry, preregistration Acceptance date of the registration request Return registration request as incomplete
Annual registration: $35 Two months before the anniversary date of the registration (state office notifies) Anniversary date of the registration Automatic suspension, if the fee is not paid by the anniversary date

 

Automatic revocation, if the fee is not paid within six months after the automatic suspension begins

Background check per person: $2 Not applicable At the time the background check request is submitted or on a monthly or quarterly basis Possible suspension or revocation of the permit

Texas Human Resources Code §§42.054; 42.056(c)

40 TAC §§745.507; 745.517

 

5223 Listing - Fee Chart

September 2016

 

The following chart contains fees required for listed family homes. Some listed family homes may be exempt from the fees listed. See 5211 Exemptions From Fees.

Type and Amount
of Fee
When to
Notify Operation
When Fee Payment is Due Consequence if Operation Fails to Meet Time Frames
Initial Application/request Listing Fee: $20 Upon listing Listing request acceptance date Return listing request as incomplete
Annual Listing Fee: $20 Two months before anniversary date of listing (state office notifies) Anniversary date of listing Automatic suspension if fee not paid by anniversary date

 

Automatic revocation if fee not paid within six months after automatic suspension begins

Background check per person: $2 Not applicable At the time the background check request is submitted or on a monthly or quarterly basis Possible suspension or revocation of the listing for failure to submit the fee

Texas Human Resources Code §§42.054; 42.056(c)

40 TAC §§745.505; 745.517

 

5224 Administrator’s License - Fee Chart

May 2012

 

The following chart contains application, examination, and renewal fees required for an administrator’s license. An administrator’s license may not be renewed unless the required training documentation is submitted with the fee.

Type and Amount
of Fee
When to
Notify Operation
When Fee is Due Consequence if Operation Fails to Meet Time Frames
Application: $100 Inquiry, preapplication, or application Application acceptance date Return application as incomplete
Examination: $50 Inquiry, preapplication, or application Before examination Do not schedule for test
Replacement: $5 When requesting a replacement or copies Before issuance Do not issue
Renewal: $50
Renewal if within 90 days late: $75
Renewal if more than 90 days but less than 2 years late: $100
Application for renewal Before issuance Do not issue renewal

Texas Human Resources Code §43.006

40 TAC §§745.8931; 745.8933(6); 745.9003; 745.9005

See also:

9430 Renewal Fees for an Administrator's License

 

5225 Operations with a Compliance Certificate – Fee Chart

February 2013

 

The following chart contains fees required for small employer-based child care operations and temporary shelter child care operations, when the fees are due, and the consequences for failure to pay on time:

Type and Amount
of Fee
When Fee is Due Consequences for Failure to Pay
Fee on Time

Application/ Compliance Certificate fee: $35

Before application is accepted

Return application as incomplete

Background check fee: $2 per person

At the time of request for a background check or on a monthly or quarterly basis

May suspend or revoke permit

Texas Human Resources Code §42.054

40 TAC §745.521

 

5230 Fees for Multiple Licenses

February 2013

 

If an applicant or permit holder wants separate licenses for different types of operations at the same location, a fee must be paid for each license.

If a day care license allows for different capacities at different times of the day, the fee is based on the highest capacity of each license.

40 TAC §§745.511; 745.513

See also 2200 Types of Child Care Permits and Multiple Operations.

 

5240 Fees for Amended Licenses

September 28, 2018

 

Procedure

Licensing staff processes a fee for an amended license as follows:

  • If a permit holder requests an amendment to increase the operation’s capacity, the inspector informs the permit holder that he or she must pay a fee for each child added to the capacity before the amended license can be issued.
  • After determining what the new capacity will be, the Licensing staff gives the permit holder the appropriate Child Care Fee Schedule and a fee envelope, and instructs the permit holder to send a cashier’s check, corporate check, money order, or certified check and completed form for required fee to HHSC Accounts Receivable.

Before issuing the amended license, Licensing staff:

  1. ensures standards relevant to the amendment are met;
  2. verifies in CLASS under the Fees tab that the fee has been paid; and
  3. documents the date the payment was received and the Document Locator Number (DLN) for the payment in a Chronology (type Fees).

The fee is not prorated. If a license is amended to reduce capacity, the permit holder does not receive a refund. The reduction is reflected in the next annual fee payment.

40 TAC §§745.509(12); 745.517

 

5250 Fee Refund Guidelines

February 2018

 

No refund is made if a permit is revoked or relinquished.

Fees that have been paid may be refunded only under certain conditions. Those conditions are outlined in the following refund chart:

Texas Human Resources Code §42.054

Refund Chart

Type of Fee Conditions for Refund
Application fee when issuance was late Fee is refunded after appeal
Initial application fee Nonrefundable fee
Initial license fee Refunded if the application is withdrawn or the license is not issued
First license fee Refunded if the initial license expires with no license being issued
Registration fee: initial (application) and annual Nonrefundable
Listing Fee: initial (application) and annual Nonrefundable
Background check fee Nonrefundable
Amendment to license fee Refunded if the amendment is not issued
All fees Refunded if the fee is overpaid
All annual fees Nonrefundable

40 TAC §745.519

Procedure

Within 30 calendar days of determining the refund is due, Licensing staff completes the HHSC Refund Request Form to process a refund, as outlined in the CCL Job Aid: How to Complete the ARTS Refund Request.

 

5260 Verification of Fee Payment

September 28, 2018

 

Procedure

An interface between CLASS and the HHSC accounting system provides CLASS with fee information.

To verify that a fee has been paid, Licensing staff:

  • click on the Fees tab to open the Payment Information Summary page; and
  • review information on the page to determine whether the fee payment is documented with the correct fee amount.

If the Fee is Not on the Operation’s Payment Information Summary Page in CLASS

If the fee information is not on the operation’s Payment Information Summary page in CLASS, Licensing staff completes the following tasks in the order listed below until payment is verified and documented in the operation’s record in CLASS.

Step 1: Complete Payment Verification Search

Licensing staff complete a search for a payment through the Verify Payments link in CLASS (located in CLASS Tools).

If the payment is identified and confirmed through the search, Licensing staff:

  1. attach the payment to the operation by checking the Select box and saving the page;
  2. confirm that the payment has been attached to the operation by reviewing the operation’s Payment Information Summary page in CLASS; and
  3. document the information in a Chronology (type Fees).

If the payment is not confirmed after completing the search, Licensing staff complete Step 2, below.

Step 2: Obtain Receipt and Complete Subsequent Payment Verification Search

If the payment is not confirmed through the search outlined in Step 1, Licensing staff:

  • obtain proof of payment (canceled check, copy of money order, or documentation from banking institution) furnished by the permit holder or applicant; and
  • conduct another search for the payment through the Verify Payments link in CLASS (located in CLASS Tools), narrowing the scope of the search by the date on the receipt.

If the payment is identified and confirmed, Licensing staff:

  1. attach the payment to the operation by checking the appropriate Select box and saving the page;
  2. go to the operation’s Payment Information Summary page to confirm that the payment has been attached in CLASS;
  3. document the information in a Chronology (type Fees); and
  4. file proof of payment in the hard copy record.

If the payment is not identified after obtaining a receipt and completing a second search, Licensing staff completes Step 3, below.

Step 3: Payment Not Verified After Two Searches

If the payment is not identified after completing the tasks outlined in Step 2, Licensing staff:

  • enter a Chronology (type Fees) detailing the payment information;
  • file proof of payment in the hard copy record; and
  • consider the fee paid.

 

5261 How to Verify and Follow-Up on an Insufficient Fund Payment (NSF)

September 28, 2018

 

Procedure

If Accounts Receivable rejects a fee payment because of non-sufficient funds (NSF) or other reasons, Licensing staff must:

  1. follow-up with the operation;
  2. ensure the payment is re-submitted; and
  3. verify the payment in CLASS once Accounts Payable processes the payment.

Licensing staff complete the following tasks in the order listed below to reconcile a NSF payment.

Step 1: Licensing Staff Receive Notification of an NSF Payment

State office Licensing staff send the following information to the appropriate Licensing staff whenever Accounts Receivable notifies state office of a NSF payment:

  1. A scanned copy of the NSF check.
  2. A copy of the notification Accounts Receivable sent to the provider.
  3. Instructions to follow-up with the operation.

Step 2: Licensing Staff Notify an Operation of an NSF Payment

Within five days of receiving notification from state office, Licensing staff follows up with the operation by notifying the operation of all of the following:

  1. The check received from the operation for the fee payment was returned for non-sufficient funds.
  2. Fee payment must be submitted by a specific date set by Licensing staff.
  3. The operation should pay the outstanding fee in the form of a money order or cashier’s check.
  4. Action that Licensing may take if the fee is not paid.

Licensing staff documents a Chronology (type Fees) in CLASS and includes all of the following information:

  1. Document Locator Number (DLN) of the fee that was returned as NSF.
  2. Date that the operation was notified of the NSF payment.
  3. The person that Licensing staff informed of the NSF payment.
  4. Date by which Licensing staff instructed the operation to resubmit the payment.

Licensing staff files a copy of the rejected payment notice in the operation’s external file.

Step 3: Licensing Staff Verify Payment

Once an operation resubmits a payment, Accounts Receivable re-enters the payment information into the accounting system and the payment verification is automatically sent to CLASS with a new DLN.

Licensing staff must verify that the payment is documented in CLASS under the Fee tab before issuing or renewing an initial or full permit. Staff may request a copy of the cashier’s check that was submitted if the payment is not showing in CLASS, but it still needs to be resolved in CLASS before issuance or renewal.

If the operation does not resubmit the payment by the set deadline, Licensing staff complete the following steps for non-payment of fees:

  1. Follows procedures to return application as incomplete if the application fee is not paid timely (see 5220 Fee Schedules and Consequences When Fees are Not Paid).
  2. Follows procedures for auto-suspension or auto-revocation if the annual fee is not paid timely (see 7800 Automatic Actions).
  3. Follows procedures for actions taken when fees other than the application fee or annual fee are not paid (see 5220 Fee Schedules and Consequences When Fees are Not Paid).

Licensing staff documents a Chronology (type Fees) and includes:

  • the DLN of the new fee payment, if the payment was resubmitted; or
  • the action taken, if the payment was not resubmitted by the deadline.

Step 4: Licensing Staff Notify State Office Staff

Within 15 days of being notified of the NSF payment, Licensing staff notifies Licensing state office via email of the follow-up results, including whether the fee was paid or what action was taken if operation failed to resubmit the payment by the deadline.

 

5270 Fee Notice is Returned

 

 

5271 Licensed and Registered Operations

February 2013

 

Procedure

If the post office returns an annual fee notice marked undeliverable at this address, address unknown, or otherwise indicates that the operation did not receive the notice, the inspector completes an inspection at the operation to determine whether it is operating.

 

5271.1 Inspector Determines Operation is Operating During the Inspection

September 28, 2018

 

Procedure

If someone is present at the operation and the inspector determines that the operation is operating during the inspection, the inspector documents the inspection as a Follow-up inspection (see 4300 Conducting a Follow-Up with an Operation).

Before leaving the operation, the inspector:

  1. confirms the operation’s contact information and mailing address and updates the information in CLASS, if necessary;
  2. provides the operation with the annual fee notice that was returned to HHSC;
  3. instructs the operation that the fee must be paid within five days; and
  4. documents in the Narrative text box on CLASS Form 2936 that the fee notice was provided to the operation.

Following the completed inspection, Licensing staff:

  • file a copy of the returned notice in the hard copy record; and
  • follow steps to ensure payment is received within 10 days after the inspection (see 5260 Verification of Fee Payment).

 

5271.2 Inspector Determines Operation is Not Operating During Inspection

February 2013

 

Procedure

If someone is present at the operation and the inspector verifies the operation’s intent to no longer operate, the inspector:

  • documents the inspection as a Follow-Up inspection(see 4300 Conducting a Follow-Up with an Operation); and
  • includes a statement that the operation is not operating in the Narrative text box on CLASS Form 2936 Child Care Facility Inspection form.

After a completed follow-up inspection, Licensing staff:

  1. file the returned notice in the hard copy record;
  2. close the license or registration in CLASS as a voluntary closure (see 7340 Voluntary Closure) within 10 days after the inspection; and
  3. inform the Child and Adult Care Food and Nutrition Program staff of the Department of Agriculture, if applicable, within 10 days after the inspection.

 

5271.3 No One is Present at the Operation During Inspection

February 2013

 

Procedure

If no one is present at the operation and it can be determined that the operation is no longer operating and caring for children, the inspector completes all of the following tasks within 10 days after the inspection:

  1. Documents the inspection as a Follow-up inspection.
  2. Documents the determination in a Chronology (type Monitoring).
  3. Closes the license or registration in CLASS as a voluntary closure (see 7340 Voluntary Closure).
  4. Informs the Child and Adult Care Food and Nutrition Program staff of the Department of Agriculture, if applicable.

If no one is present at the operation and it cannot be determined whether the operation is operating and continuing to care for children, then within 10 days the inspector:

  1. Documents the inspection as an Attempted inspection;
  2. Documents the observations made during the inspection in the Narrative text box on CLASS Form 2936 Child Care Facility Inspection form.
  3. Consults with the supervisor to determine the next course of action.

The inspector files the notice in the hard copy record after it is returned.

 

5272 Listed Family Homes

February 2013

 

Procedure

If the post office returns an annual fee notice marked undeliverable at this address, address unknown, or otherwise indicates that the operation did not receive the notice, within10 days, Licensing staff:

  1. file the returned notice in the hard copy record;
  2. document the contact information in the Chronology within 10 days after the inspection; and
  3. close the listing in CLASS as a voluntary closure within 10 days after the inspection (see 7340 Voluntary Closure).

 

5300 Reserved for Future Use

 

5400 Controlling Person

September 2012

 

Licensing staff conduct all of the following activities related to controlling persons for operations other than temporary shelter child care operations and small employer-based child care operations:

  1. Obtain information on all controlling persons from applicants.
  2. Ensure that Licensing has the most current information on all controlling persons for operations with permits.
  3. Conduct searches in the CLASS and Adverse Action Record-Sharing (AARS) systems to search for controlling persons at operations that are applying for a permit.
  4. Conduct searches in the CLASS system for controlling persons at operations that have a permit.
  5. Enter information on controlling persons into the CLASS system.
  6. Determine eligibility for persons in the role of a controlling person.
  7. Notify the controlling person, applicant, or operation about the controlling person’s eligibility for the role of controlling person.
  8. Monitor operations for compliance with statutes, administrative rules, and minimum standards related to controlling person.
  9. Conduct due process activities associated with controlling persons who are designated because an operation that the person was a controlling person for had a permit revoked.

 

5410 Definitions of Terms Related to Controlling Persons

 

 

5411 Definition of Controlling Person

September 2012

 

A controlling person is a person who, either alone or in connection with others, has the ability to directly or indirectly influence or direct the management, expenditures, or policies of an operation.

Human Resources Code §42.002(18)

All operations must identify persons serving in the role of a controlling person at the operation.

Exception: Identifying controlling persons is not required for temporary shelter child care operations or small employer-based child care operations.

A controlling person of a child care operation includes any of the following:

  1. An owner of the operation
  2. A member of the governing body of the operation, including, as applicable, an executive, an officer, a board member, and a partner
  3. A sole proprietor
  4. The sole proprietor’s spouse
  5. The primary caregiver at a child care home
  6. The spouse of the primary caregiver at a child care home
  7. A person who manages, administrates, or directs the operation or its governing body, including a day care director or a licensed administrator
  8. A person who, either alone or in connection with others, has the ability to influence or direct the management, expenditures, or policies of the operation. For example, a person may have influence over the operation because of a personal, familial, or other relationship with the governing body, manager, or other controlling person of the operation.

40 TAC §745.901(a)

An employee, lender, secured creditor, or landlord of the operation is not a controlling person, unless the person meets the requirements listed above.

40 TAC §745.901(c)

A person does not have to be present at the operation or hold an official title at the operation or governing body in order to be a controlling person.

40 TAC §745.901(b)

 

5411.1 Persons Who are Ineligible to be a Controlling Person

March 2013

 

A person may not serve as a controlling person at an operation regulated by Licensing if the person:

  1. is ineligible to receive a permit (see 3222 How to Determine Whether the Applicant Is Eligible to Apply);
  2. has been denied a permit for a substantive reason;
  3. has had a permit revoked;
  4. voluntarily closed an operation or relinquished a permit after Licensing notified the operation of the intent to revoke a permit;
  5. voluntarily closed an operation or relinquished a permit after Licensing notified the operation of a decision to revoke a permit;
  6. was a controlling person for an operation at the time the conduct occurred that resulted in the permit being revoked;
  7. was a controlling person for an operation that closed or relinquished a permit after Licensing notified the operation of the intent to revoke a permit; and
  8. who was a controlling person for an operation that closed or relinquished a permit after Licensing notified the operation of a decision to revoke a permit.

Human Resources Code §§42.062, 42.072(c-1), (g)

40 TAC §745.911

 

5412 Definition of a Match for Controlling Persons

September 2012

 

In regard to controlling persons, a match exists when a search in the CLASS or HHSC Adverse Action Record-Sharing (AARS) systems reveals that a person is:

  1. a designated controlling person;
  2. a sustained controlling person;
  3. ineligible to receive a permit (see 3222 How to Determine Whether the Applicant is Eligible to Apply); or
  4. listed in the AARS system.

 

5420 When and How Applicants and Operations Submit Information on Controlling Persons

 

 

5421 When Applicants and Operations Submit Information on Controlling Persons

March 2013

 

Licensed Operations and Registered Family Homes

The applicant, permit holder, or head of the governing body of a licensed operation or registered family home submits information on controlling persons:

  1. when submitting an application;
  2. within two days after a person becomes a controlling person at the operation; or
  3. within two days after a person ceases to be a controlling person at the operation.

26 TAC §§744.305(a)(6), 746.305(a)(6), 747.303(a)(6), 748.103(13); 749.103(18), 750.103(11)

40 TAC §745.903

Listed Family Homes

The applicant or permit holder of a listed family home submits information on controlling persons:

  • when submitting an application; or
  • within two days after a person becomes a controlling person at the operation.

40 TAC §745.903

 

5422 How Applicants and Operations Submit Controlling Person Information

September 28, 2018

 

Applicants for a License

An applicant for a license completes Form 2760 Controlling Person-Child Care Licensing, to submit controlling person information to Licensing. Before submitting Form 2760, the applicant, designee, or head of the governing body signs the form to indicate that the information submitted is correct.

40 TAC §745.903

See:

3223 Evaluating an Application for Completeness

5433 Reviewing Form 2760 Controlling Person-Child Care Licensing, for Completeness

Applicants for a Registration or Listing

An applicant for a registration or listing submits controlling person information by:

  • completing Form 2760 Controlling Person-Child Care Licensing, if a paper application is being submitted; or
  • entering information for all controlling persons online through the aplicant's online Child Care Licensing Account, if an e-application is being submitted.

If an applicant is submitting Form 2760, the applicant, designee, or head of the governing body must sign the form to indicate that the information submitted is correct.

40 TAC §745.903

See:

3223 Evaluating an Application for Completeness

3610 Listing Application

5433 Reviewing Form 2760 Controlling Person-Child Care Licensing for Completeness

Operations with a Permit – Submit New Controlling Person

An operation with a permit submits information on a new controlling person by:

  • entering information for the new controlling person online through the operation's online Child Care Licensing Account, if the operation has an online account; or
  • completing a new Form 2760 Controlling Person-Child Care Licensing, if the operation does not have an online account.

If the operation is submitting Form 2760, the permit holder, designee, or head of the governing body must sign the form to indicate that the information submitted is correct.

See 5433 Reviewing Form 2760 Controlling Person-Child Care Licensing for Completeness.

Exception: Temporary shelter child care operations and small employer-based child care operations are not required to submit controlling person information.

Operations with a Permit – Submit Updates on Current Controlling Persons

If a person ceases to be a controlling person at an operation or if the controlling person’s contact information has changed, an operation submits this information by:

  • entering the information online through the operation's online Child Care Licensing Account; or
  • contacts the inspector to provide the updated information, if the operation does not have an online account.

Exception: Temporary shelter child care operations and small employer-based child care operations are not required to submit controlling person information.

 

5422.1 Controlling Persons at a Child-Placing Agency (CPA)

December 2012

 

A person may serve as a controlling person for:

  • the CPA’s main office;
  • one or more of the CPA’s branch offices; or
  • any combination of the above.

The chart below outlines which CPA office can submit controlling person information, based upon which office the person serves as a controlling person:

If a Person Serves as a Controlling Person for a … The Office that Can Submit Controlling Person Information is …
CPA main office Main office only
CPA branch office Branch office where the person serves as a controlling person
OR
Main office

 

5430 Processing and Reviewing the Information on Controlling Persons Submitted by an Operation

 

 

5431 Processing Information on a Controlling Person Before Issuing a Permit

October 2013

 

Before issuing a permit to an applicant, Licensing staff determine whether each person whose name was submitted by the operation is eligible to be a controlling person and document the decision, as follows:

  1. Reviews the controlling person information that the applicant submitted (see 5433 Reviewing Form 2760 Controlling Person-Child Care Licensing for Completeness and 5434 Reviewing Controlling Person Information Submitted Online).
  2. Conducts a Controlling Person Search and a Global Person Search in the CLASS system and searches the HHSC Adverse Action Record Sharing (AARS) systems for records on the person.
  3. Associates (links) a controlling person’s existing record with the applicant’s record in CLASS or adds a new record for the controlling person, under the applicant’s record in CLASS (see 5442 Searching for and Adding a Controlling Person Record in CLASS).
  4. Determines the person’s eligibility to be a controlling person by resolving any matches found as a result of searches conducted in the CLASS or AARS systems.
  5. Documents the person’s eligibility in CLASS.
  6. Notifies the controlling person or applicant about the person’s eligibility.

Exception: Persons applying for a permit to operate a temporary shelter child care operation or small employer-based child care operation are not required to submit information on controlling persons.

See:

1500 Conducting a Search in CLASS

5420 When and How Applicants and Operations Submit Information on Controlling Persons

5440 Conducting Searches for Controlling Persons in the CLASS and AARS Systems and Adding Controlling Persons to CLASS

5450 Determining and Documenting the Eligibility of a Controlling Person

5460 Notifying an Applicant, Permit Holder, or Controlling Person About a Person’s Eligibility to Serve as a Controlling Person

40 TAC§745.913

 

5432 Processing Information on New Controlling Persons When Submitted by an Operation that Has a Permit

October 2013

 

Within 10 days after an operation with a permit (other than a temporary shelter child care operation or small employer-based child care operation) submits information on a new controlling person for the operation (see 5421 When Applicants and Operations Submit Information on Controlling Persons and 5422 How Applicants and Operations Submit Controlling Person Information), the inspector determines whether each person is eligible to be a controlling person and documents the decision, as follows:

  1. Reviews the information that the operation submitted (see 5433 Reviewing Form 2760 Controlling Person-Child Care Licensing for Completeness and 5434 Reviewing Controlling Person Information Submitted Online).
  2. Conducts a Controlling Person Search and a Global Person Search in the CLASS system for a record on the person.
  3. Associates (links) the controlling person’s existing record with the record for an operation in CLASS or adds a new record for the controlling person under the record for the operation’s record in CLASS (5442 Searching for and Adding a Controlling Person Record in CLASS).
  4. Determines the person’s eligibility to be a controlling person by resolving any matches found as a result of the search in CLASS.
  5. Documents the person’s eligibility in CLASS.
  6. Notifies the controlling person or operation about the person’s eligibility.

See:

1500 Conducting a Search in CLASS

5420 When and How Applicants and Operations Submit Information on Controlling Persons

5440 Conducting Searches for Controlling Persons in the CLASS and AARS Systems and Adding Controlling Persons to CLASS

5450 Determining and Documenting the Eligibility of a Controlling Person

5460 Notifying an Applicant, Permit Holder, or Controlling Person About a Person’s Eligibility to Serve as a Controlling Person

40 TAC§745.913

 

5432.1 Processing Updates to Controlling Person Information When an Operation Has a Permit

September 28, 2018

 

If an operation notifies Licensing staff of updates to information about a current controlling person for the operation (for example, updating a controlling person’s mailing address), Licensing staff enter the updated information in CLASS within 15 days from when the operation notified staff of the change.

If an operation submits updates to information about a current controlling person online through the operation’s online Child Care Licensing Account, the information in CLASS is automatically updated by the system unless CLASS determines that there is a conflict or error with the data entered. If CLASS determines there is a conflict or error, Licensing staff process the update submitted online within 15 days of the day staff received the notice that the update has a conflict or error.

 

5432.11 Controlling Person Online Updates – Conflict Errors Automatically Entered by CLASS

September 28, 2018

 

When an operation or applicant submits updates to controlling person information online in the operation or applicant’s online Child Care Licensing Account, CLASS determines whether there is a conflict error with the data submitted. CLASS automatically determines and selects the conflict error on the Controlling Person – Update submitted by Operation – CONFLICT page. The inspector must review the information on the page and select the Invalidate Submission button to clear the inspector’s To Do and notify the operation of the error.

Below is a chart that explains the different conflict errors.

Conflict Error Is automatically selected by CLASS when …
Controlling person not active The operation is attempting to update a controlling person record that the inspector has already end dated in CLASS (that is, the controlling person’s status in CLASS is Withdrawn, Rejected, or Inactive).
Duplicate SSN The operation is attempting to update a controlling person record with an SSN that is already associated with a different CP record (that is, a different person) in CLASS.
SSN entered does not match the SSN in CLASS The operation is attempting to update a controlling person record by entering a SSN for the person, but the inspector has already entered a SSN for the same controlling person record in CLASS and the SSNs do not match.
Last active CP cannot be end-dated The operation is attempting to enter an end date for the only active controlling person in CLASS (that is, there are no other controlling persons in Pending, Identified, or Review status).

 

5433 Reviewing Form 2760 Controlling Person Child Care Licensing for Completeness

December 2012

 

When an applicant or operation submits Form 2760 Controlling Person-Child Care Licensing, the inspector reviews the form to ensure that it is complete and signed by the applicant, permit holder, designee, or head of the governing body.

If the inspector receives Form 2760 as part of an application, the inspector cannot accept the application if Form 2760 is not complete and signed by the applicant, designee, or head of the governing body. See 3223.1 If the Application is Incomplete or Contains Errors.

Procedure

The inspector reviews Form 2760 to ensure that the following identifying information is provided for each controlling person listed.

  1. Name (first, middle, last), including any maiden names, married names, or aliases
  2. Date of birth
  3. Current address and phone number
  4. Title, position, or relationship
  5. Main office or branch office number, for persons associated with a child placing agency
  6. Effective date as a controlling person
  7. Driver license number or state-issued identification card number (Optional)
  8. Social Security number (Optional)

If Form 2760 is Not Complete or Signed

Licensing staff contact the operation or the controlling person to obtain the information, if all required fields are not completed and Form 2760 is not signed.

See 3223.1 If the Application is Incomplete or Contains Errors.

If a Person’s Social Security Number is Not Listed

If a controlling person’s Social Security number is not listed, Licensing staff follow procedures in 5435 If the Controlling Person Submission Did Not Include a Social Security Number.

After Determining Form 2760 Is Complete

After determining that Form 2760 is complete, Licensing staff use the identifying information to search for each controlling person in the CLASS. If the form was submitted as part of an application, Licensing staff also conduct a search of the HHSC Adverse Action Record Sharing (AARS) system.

See:

5441 Searching for a Controlling Person in the AARS System and Documenting the Results

5442 Searching for and Adding a Controlling Person Record in CLASS

 

5434 Reviewing Controlling Person Information Submitted Online

September 28, 2018

 

Within three days of when an applicant or operation submits controlling person information online through the applicant or operation’s online Child Care Licensing Account, the inspector:

  1. reviews and invalidates the submission before conducting a search, if necessary (see 5434.1 Invalidating an Online Controlling Person Submission Before Conducting a Search of the CLASS);
  2. reviews the submission for a Social Security number (see 5434.2 Reviewing the Submission for a Social Security Number);
  3. conducts searches for an existing controlling person record in the CLASS (see 5434.3 Conducting Searches in CLASS for an Existing Controlling Person Record); and
  4. after conducting the search, either:
    • associates an existing controlling person record or adds a new controlling person record (see 5434.3 Conducting Searches in CLASS for an Existing Controlling Person Record); or
    • invalidates the submission, if necessary (see 5434.4 Invalidation Reasons That Require a Search of the CLASS Before the Submission Can Be Invalidated).

After associating or adding a controlling person record, the inspector:

  • determines whether the person is eligible to serve as a controlling person; and
  • sends the appropriate notification.

See:

5440 Conducting Searches for Controlling Persons in the CLASS and AARS Systems and Adding Controlling Persons to CLASS

5450 Determining and Documenting the Eligibility of a Controlling Person

 

5434.1 Invalidating an Online Controlling Person Submission Before Conducting a Search of the CLASS

December 2012

 

Procedure

If the online controlling submission meets any of the criteria listed in the chart below, the inspector may invalidate the submission before conducting a search of the Child Care Licensing Automation Support System (CLASS). To invalidate the submission, the inspector selects the appropriate Invalidate reason on the CLASS Controlling Person – New Submission by Operation page.

Invalidate Reason Is selected by the inspector when …
Invalid SSN The SSN provided is obviously incorrect (for example, 111-11-1111).
Invalid Driver’s License The driver license number provided is obviously incorrect (for example, 00000).
Not a Valid Controlling Person An operation is attempting to add a new controlling person who does not meet the definition of a controlling person as defined in 745.901 (for example, the person entered is a child).
Invalid Mailing Address An operation submits an address for a controlling person that matches the address of the operation (this is not applicable to licensed, registered, or listed homes).
Entered in Error An operation entered information for a controlling person in error and requests to withdraw the submission.
Facility Closed This is reserved for state office use only.

 

5434.2 Reviewing the Submission for a Social Security Number

December 2012

 

Procedure

The inspector reviews the submission to determine whether the controlling person’s Social Security number was submitted.

If the person’s Social Security number was provided, Licensing staff conduct searches for an existing controlling person record as outlined below.

If the person’s Social Security number was not provided, Licensing staff follow procedures in 5435 If the Controlling Person Submission Did Not Include a Social Security Number before conducting the searches outlined below.

 

5434.3 Conducting Searches in CLASS for an Existing Controlling Person Record

December 2012

 

Licensing staff use the identifying information to search for each controlling person to determine whether there is an existing controlling person record in the CLASS.

See 5442 Searching and Adding a Controlling Person Record in CLASS.

 

5434.4 Invalidation Reasons that Require a Search of the CLASS Before the Submission Can Be Invalidated

December 2012

 

Procedure

If the online controlling submission meets any of the criteria listed in the chart below, the inspector must conduct a search of the CLASS before selecting the appropriate Invalidate reason on the CLASS Controlling Person – New Submission by Operation page.

Invalidate Reason Is selected by the inspector when …
Duplicate Controlling Person at this facility An operation is attempting to add a new controlling person, but the person is already an active controlling person at the operation (that is, the person is already in Pending, Identified, or Review status).
Invalid SSN An operation is attempting to add a new controlling person, and:
  1. The SSN that the provider submitted already exists for a different controlling person in CLASS;
  2. The controlling person information that the provider submitted matches a controlling person record in CLASS (that is, it is the same person), but the SSNs do not match ; or
  3. The SSN provided is obviously incorrect (for example, 111-11-1111).
Invalid Driver’s License
  1. An operation is attempting to add a new controlling person, and the driver license number that the provider submitted already exists for a different controlling person in CLASS; or
  2. The driver license number provided is obviously incorrect (for example, 00000).
Effective start date overlaps with earlier end date for Controlling Person An operation is attempting to add a new controlling person who has previously been associated with the operation. The Start Date entered for the new association is earlier than the End Date for the previous association.
Not a valid Controlling Person An operation is attempting to add a new controlling person who does not meet the definition of a controlling person as defined in 745.901 (for example, the person entered is a child).
Invalid Mailing Address An operation submits an address for a controlling person that matches the address of the operation (this is not applicable to licensed, registered, or listed homes).
Entered in Error An operation entered information for a controlling person in error and requests to withdraw the submission.
Facility Closed This is reserved for state office use only.

 

5435 If the Controlling Person Submission Did Not Include a Social Security Number

December 2012

 

Procedure

If a controlling person’s Social Security number was not included with the controlling person information submitted by the applicant or operation, Licensing staff:

  • contact the applicant, operation, or controlling person to ask for the person’s Social Security number; or
  • obtain the person’s Social Security number by reviewing Licensing records to determine if the operation has submitted a request for a background check on the person.

If the applicant, operation, or controlling person provides the Social Security number, Licensing staff enter the information in the CLASS.

If Licensing staff obtain the person’s Social Security number by reviewing Licensing background check records, Licensing staff must be certain that the background check record where the Social Security number is listed is for the same person in the controlling person submission before adding the Social Security number to the controlling person record in CLASS.

If the controlling person refuses to provide his or her Social Security number, Licensing staff:

  • select the Refused to Disclose SSN indicator in CLASS; and
  • use other identifying information to conduct the search.

 

5440 Conducting Searches for Controlling Persons in the CLASS and AARS System and Adding Controlling Persons to CLASS

December 2012

 

Licensing staff search the HHSC Adverse Action Record Sharing (AARS) system only when controlling person information is submitted before a permit is issued. See 5441 Searching for a Controlling Person in the AARS System and Documenting the Results.

Licensing staff search the Child Care Licensing Automation Support System (CLASS) when controlling person information is submitted:

  • before a permit is issued; and
  • when the operation has a permit.

See 5442 Searching for and Adding a Controlling Person Record in CLASS.

Exception: Searches are not completed for temporary shelter child care operations or small employer-based child care operations.

After conducting the appropriate searches, Licensing staff resolve any matches and determine a controlling person’s eligibility to serve as a controlling person. See 5450 Determining and Documenting the Eligibility of a Controlling Person.

 

5441 Searching for a Controlling Person in the AARS System and Documenting the Results

September 28, 2018

 

Licensing staff search the HHSC Adverse Action Record Sharing (AARS) system only when controlling person information is submitted before a permit is issued for an operation other than a temporary shelter child care operation or small employer-based child care operation.

A designated Licensing employee that has access to the AARS system conducts the search to determine whether an applicant or each of the persons submitted by the applicant is eligible to be a controlling person. The designated employee documents the results of the search in the CLASS. The AARS search is completed in addition to the search conducted to determine whether an applicant is qualified to apply for a permit (see 3222 How to Determine Whether the Applicant is Eligible to Apply).

Exception: An AARS search is not conducted if staff determine that a person does not meet the definition of a controlling person. See 5411 Definition of a Controlling Person.

Procedure

After an applicant submits controlling person information, the inspector assigned to process the application coordinates with a designated user of the AARS system to conduct a search in the AARS system for the controlling person.

If a paper application is submitted, the designated user of the AARS system uses the information on the application and on Form 2760, Controlling Person – Child Care Licensing, to conduct the search.

If a registered family home or a listed family home submits an e-application, the designated user of the AARS system conducts the AARS search by using the controlling person information:

  • entered on the e-application; and
  • submitted online through the applicant’s online Child Care Licensing Account.

Documenting AARS Search Results

After conducting the AARS search, the designated user of the AARS system creates a Chronology in CLASS, with a chronology type of Application, to:

  • document that a search of the AARS system was conducted for each controlling person; and
  • document the results of the search for each controlling person.

 

5441.1 If a Controlling Person is Listed in the AARS System

December 2012

 

If the controlling person is found in the HHSC Adverse Action Record-Sharing (AARS) system:

  • the designated user of the AARS system follows procedures in 5441 to document the results of the AARS search in the CLASS; and
  • the inspector follows the procedures in 5450 Determining and Documenting the Eligibility of a Controlling Person to resolve the match.

 

5442 Searching for and Adding a Controlling Person Record in CLASS

September 28, 2018

 

Procedure

For applicants and operations with a permit, the inspector conducts a search for the controlling person in the CLASS, under the CLASS record for the applicant or operation that submitted the controlling person information.

After conducting the search, the inspector:

  1. associates (links) a controlling person’s existing record with the applicant’s or operation’s record in CLASS (see 5442.1 Associating a Controlling Person with an Existing Record in CLASS);
  2. adds a new record for the controlling person under the applicant’s or operation’s record in CLASS, if an existing record is not found after staff manually enter the controlling person information obtained from Form 2760, Controlling Person – Child Care Licensing, to conduct the search in the CLASS (see 5442.2 Manually Adding a New Record for a Controlling Person in CLASS);
  3. accepts the submission to add a new record for the controlling person under the applicant’s or operation’s record in CLASS, if the search was completed using the controlling person information the applicant or operation submitted online through the Child Care Licensing Account (see 5442.3 Accepting an Online Submission of a New Controlling Person Record in CLASS).

After each search, the inspector associates the record, adds a new record, or accepts the submission of a new record even if the person is found to be ineligible to be a controlling person, unless the submission is invalidated (see 5434.1 Invalidating an Online Controlling Person Submission Before Conducting a Search of the CLASS and 5434.4 Invalidation Reasons that Require a Search of the CLASS Before the Submission Can Be Invalidated).

The inspector leaves the Status field on the Controlling Person Details page as Pending until:

  1. the search for the controlling person in the CLASS is complete;
  2. the search for the controlling person in the HHSC Adverse Action Record Sharing (AARS) system is complete (see 5441 Searching for a Controlling Person in the AARS System and Documenting the Results), if the operation is applying for a permit; and
  3. matches for the controlling person, when found as a result of the searches, are resolved (see 5450 Determining and Documenting the Eligibility of a Controlling Person).

Additional Steps for a CPA Controlling Person Record

Child-placing agency (CPA) controlling person records are entered under the CLASS record for each office (main office or branch office) that the person serves as a controlling person for.

The CPA designates which office the person serves as a controlling person when submitting Form 2760 Controlling Person-Child Care Licensing or submitting the information online through the CPA’s online Child Care Licensing Account (See 5422.1 Controlling Persons at a Child-Placing Agency (CPA)).

If Form 2760 was submitted to the inspector for the CPA’s main office, the inspector:

  • enters the record under the CPA’s main office; and
  • indicates which office(s) the person serves as a controlling person for by selecting the following from the Main/Branch drop-down box in the Selected Association section of the Controlling Persons Detail page:
    • M, if the person serves as a controlling person for the CPA’s main office; and
    • the applicable branch number(s), if the person serves as a controlling person for a branch office of the CPA.

An inspector for a branch office can only enter controlling persons for the office to which they are assigned.

 

5442.1 Associating a Controlling Person with an Existing Record in CLASS

December 2012

 

Procedure

If a controlling person has an existing record in CLASS, the inspector associates (links) the person’s record to the operation’s record in CLASS by:

  • selecting the controlling person’s record found through the search; and
  • selecting Associate.

If the inspector associated the controlling person record as a result of an operation submitting Form 2760, Controlling Person – Child Care Licensing, the inspector also updates the information entered in the Person Details, Alternate Names, and Selected Association sections of the Controlling Person Details page, as needed.

If the inspector associated the controlling person record as a result of an online submission, the inspector also updates the information entered in the Person Details section of the Controlling Person Details page, as needed.

 

5442.2 Manually Adding a New Record for a Controlling Person in CLASS

December 2012

 

Procedure

If an existing record for a controlling person is not found after staff manually enter the information obtained from Form 2760, Controlling Person – Child Care Licensing, to conduct the search in the CLASS, the inspector adds a new record for the controlling person to the applicant’s or operation’s record in CLASS by:

  • selecting Add New on the Controlling Person Search page; and
  • completing the Person Details, Alternate Names, and Selected Association sections of the Controlling Person Details page.

 

5442.3 Accepting an Online Submission of a New Controlling Person Record in CLASS

September 28, 2018

 

Procedure

If an existing record for a controlling person is not found after staff complete a search of the CLASS using the controlling person information the applicant or operation submitted online through the applicant's or operation’s online Child Care Licensing Account, the inspector adds a new record for the controlling person to the Controlling Person – New Submission by Operation page in the applicant’s or operation’s record in CLASS by:

  • updating the Person Details, if necessary; and
  • selecting Accept Submission; and

 

5450 Determining and Documenting the Eligibility of a Controlling Person

December 2012

 

After searching the CLASS and HHSC Adverse Action Record Sharing (AARS) system, as appropriate, for a record on a controlling person and adding or associating a record for the controlling person in CLASS, the inspector:

  1. determines whether a match exists;
  2. resolves any matches found in the CLASS or AARS system; and
  3. updates the status of the controlling person in CLASS.

See:

5412 Definition of a Match for Controlling Persons

5451 Resolving Matches Found in the AARS System

5452 Eligibility to Receive a Permit After Finding a Match for an Applicant

5453 Eligibility to Serve As a Controlling Person After Finding a Match

5454 Documenting the Eligibility of a Controlling Person by Updating the Status in CLASS

 

5451 Resolving Matches Found in the AARS System

December 2012

 

If a search of the HHSC Adverse Action Record Sharing (AARS) system results in a match, Licensing staff resolve the match by:

  • determining the reason for the match; and
  • consulting with the Licensing attorney to determine whether the match makes the person ineligible to be a controlling person.

Procedure

After determining that a person has a match in the AARS system, the inspector determines whether the person has had a permit denied, revoked, or suspended by another HHSC agency because the applicant or person:

  1. committed an act or omission that resulted in physical or mental harm to an individual;
  2. is a threat to the health, safety, or well-being of an individual;
  3. engaged in the physical, mental, or financial exploitation of an individual; or
  4. committed an act or omission that renders the person unqualified or unfit to fulfill the obligations of the license.

The inspector and supervisor then consult with a Licensing attorney to determine whether the person’s listing in the AARS qualifies as a substantive reason to either deny the application or request that the operation remove the person from the role of controlling person.

See:

5452 Eligibility to Receive a Permit After Finding a Match For an Applicant

5453 Eligibility to Serve As a Controlling Person After Finding a Match

 

5452 Eligibility to Receive a Permit After Finding a Match for an Applicant

December 2012

 

The chart below outlines whether a person is eligible to receive a permit, based on the results found after finding a match found on a controlling person who is also the applicant during a search of the CLASS or HHSC Adverse Action Record Sharing (AARS) system.

If the controlling person with a match is not the applicant, see 5453 Eligibility to Serve as a Controlling Person After Finding a Match.

If the applicant is … Does Licensing Issue a Permit?
a designated controlling person … No.
Licensing will not issue a permit until due process is final.
Licensing may deny a permit, if the person applies before due process is final.
a sustained controlling person … No.
Licensing denies the person a permit, if the application is received within five years after the designation is sustained.
ineligible to apply for a permit because of adverse action … No.
listed in the HHSC AARS system … Maybe.
Licensing may issue a permit only if a Licensing attorney determines that the reason the person is listed in the AARS system does not constitute a substantive reason to deny the person a permit.

40 TAC §§745.907, 745.8605(15)

 

5453 Eligibility to Serve As a Controlling Person After Finding a Match

September 28, 2018

 

The chart below outlines whether a person (who is not the applicant) is eligible to serve as a controlling person at an operation, based on the type of match found on the controlling person during a search of the CLASS or HHSC Adverse Action Record Sharing (AARS) system.

If the controlling person with a match is the applicant, see 5452 Eligibility to Receive a Permit After Finding a Match For an Applicant.

If the person submitted by the operation is … Is the person eligible to serve as a controlling person?
a designated controlling person … Yes.
a sustained controlling person … No.

This person may not serve as a controlling person at an operation for five years after the designation is sustained.
If the operation has a permit, the permit holder must remove the person who is ineligible to serve as a controlling person from the role of controlling person. If the permit holder refuses or is unable to remove the person from the role of controlling person, Licensing must revoke the permit.

If the operation is applying for a permit, the applicant must remove the person who is ineligible to serve as a controlling person from the role of controlling person before Licensing can issue a permit. If the applicant refuses or is unable to remove the person from the role of controlling person, Licensing cannot issue the permit.
ineligible to apply for a permit because of adverse action … Maybe.

If the operation has a permit and if a Licensing attorney determines that the reason the person is ineligible to serve as a controlling person constitutes a substantive reason to prohibit the person from being a controlling person in an HHSC-regulated operation, then the permit holder must remove the person who is ineligible to serve as a controlling person from the role of controlling person. If the permit holder refuses or is unable to remove the person from the role of controlling person, Licensing must revoke the permit.

If the operation is applying for a permit and a Licensing attorney determines that the reason the person is ineligible to serve as a controlling person constitutes a substantive reason to prohibit the person from being a controlling person in an HHSC-regulated child care operation, then the applicant must remove the person who is ineligible to serve as a controlling person from the role of controlling person before Licensing can issue a permit. If the applicant refuses or is unable to remove the person from the role of controlling person, Licensing cannot issue the permit.
listed in the HHSC AARS system … Maybe.

If the operation has a permit and if a Licensing attorney determines that the reason the person is listed in the AARS system constitutes a substantive reason to prohibit the person from being a controlling person in an HHSC-regulated child care operation, then the permit holder must remove the person who is ineligible to serve as a controlling person from the role of controlling person. If the permit holder refuses or is unable to remove the person from the role of controlling person, Licensing must revoke the permit.

If the operation is applying for a permit and if a Licensing attorney determines that the reason the person is listed in the AARS system constitutes a substantive reason to prohibit the person from being a controlling person in an HHSC-regulated operation, then the applicant must remove the person who is ineligible to serve as a controlling person from the role of controlling person before Licensing can issue a permit. If the applicant refuses or is unable to remove the person from the role of a controlling person, Licensing cannot issue the permit.

40 TAC §§745.403; 745.907; 745.911, 745.8605(15)

Human Resources Code §42.072(c-1)

 

5454 Documenting the Eligibility of a Controlling Person by Updating the Status in CLASS

March 2017

 

The inspector updates the status of a controlling person in the Status field of the Controlling Person Details page in CLASS after determining that the person:

  1. is eligible to serve as a controlling person;
  2. is ineligible to serve as a controlling person;
  3. has ceased to serve as a controlling person at an operation; or
  4. was entered in error.

Procedure

The following chart explains the meaning of each option in the Status field.

The Status selected is … when …
Pending … a new record on a controlling person is entered for the operation.

Pending is the default value when adding or associating a controlling person record.
Identified … a controlling person has no history that prohibits the person from being a controlling person (that is, the person is eligible to be a controlling person).

Identified is the status for each person who is:
  1. currently serving as a controlling person for the operation; and
  2. is eligible to serve as controlling person.
Rejected … an operation submits the name of a controlling person for consideration, but the person has a history that prohibits the person from being a controlling person (that is, the person is ineligible to be a controlling person). See 5454.1 Entering the Reason for Rejecting a Controlling Person.
Review … a controlling person is sustained because the person’s record is associated with an operation that had its permit revoked.

CLASS automatically updates the status to Review when this occurs. See 7000 Voluntary Actions and Enforcement Actions
Inactive … a controlling person ceases to be a controlling person at an operation.

A status is changed to Inactive only when an end date is entered.
Withdrawn … a person is entered into CLASS in error (for example, entered under the wrong operation), or the operation withdraws the person from consideration. See 5454.1 Entering the Reason for Withdrawing a Controlling Person.

This does not include when an operation removes a person from a controlling person role after being notified by Licensing that the person is ineligible to be a controlling person.

 

5454.1 Entering the Reason for Rejecting a Controlling Person

December 2012

 

Procedure

If the Status selected in the CLASS for a controlling person is Rejected, the inspector selects a reason for the rejection from the Rejection or Withdrawal Reason drop-down box.

The following chart explains the meaning of each Rejection reason.

The option selected under Rejection Reason is or has a (an) … and when the person is rejected from being a controlling person because …
Sustained Controlling Person the person is listed as a sustained controlling person in CLASS.
AARS History
  • the person is listed in the HHSC Adverse Action Record Sharing (AARS) system; and
  • a licensing attorney has determined that the person is ineligible to be a controlling person.
Previous Application Denied the person is ineligible to receive a permit.

 

5454.2 Entering the Reason for Withdrawing a Controlling Person

December 2012

 

Procedure

If the Status selected in the CLASS for a controlling person is Withdrawn, the inspector selects a reason for the withdrawal from the Rejection or Withdrawal Reason drop-down box.

The following chart explains the meaning of the each Withdrawal reason.

The option selected under Withdrawal Reason selected is … when …
Operation Request the operation withdrew the person’s name from consideration as a controlling person.
Entered in Error the person was entered in error; for example, a person was entered for the wrong operation.

Do NOT chose this option if Licensing staff made a data entry error. In these instances, staff must request that the CLASS IT team complete a data fix.

Examples of data entry errors include:
  • Licensing staff created a controlling person record when a record for the person already existed.
  • Licensing staff made an error when entering a Social Security number.

 

5460 Notifying an Applicant, Permit Holder, or Controlling Person About a Person’s Eligibility to Serve as a Controlling Person

December 2012

 

If the person submitted for consideration as a controlling person by an applicant or operation is determined to be eligible to be a controlling person, the inspector notifies the controlling person about the determination. See 5461 Notifying a Controlling Person About Eligibility.

If the person submitted by an applicant or operation is determined to be ineligible to serve as a controlling person, the inspector notifies the applicant or permit holder about the determination. See 5462 Notifying an Operation About an Ineligible Controlling Person.

40 TAC §§745.907; 745.911; 745.915

 

5461 Notifying a Controlling Person About Eligibility

December 2012

 

Procedure

If a person submitted as a controlling person by an operation is eligible to be a controlling person, the inspector notifies the person of their eligibility by creating and sending CLASS Form 2761 Identifying a Controlling Person to the controlling person.

Additional Requirement for Child-Placing Agencies

If the inspector assigned to a CPA’s main office creates Form 2761 regarding a controlling person at a branch office for the CPA, the inspector for the main office sends a copy of the completed Form 2761 to the inspector for the branch office.

 

5462 Notifying an Applicant or Permit Holder About an Ineligible Controlling Person

December 2012

 

Procedure

If an inspector determines that a person submitted as a controlling person by an operation is ineligible to be a controlling person, the inspector does as follows:

  • Notifies the applicant or permit holder about the person’s ineligibility to be a controlling person by creating and sending CLASS Form 2765 Match of an Ineligible Controlling Person to the applicant or operation. The form includes a compliance date and directs the operation to complete and return the Operation Action Form (located on the last page of CLASS Form 2765) to Licensing by the compliance date.
  • Discusses with the applicant or permit holder the accuracy of the details on the person’s ineligibility, if the person who is ineligible to be a controlling person contacts the local Licensing office that sent the notice to say that he or she believes that the details are inaccurate.

Unless Licensing determines that the details on the person’s ineligibility are inaccurate, the permit holder must remove the person from the operation.

Additional Requirement for Child-Placing Agencies

If the inspector assigned to a CPA’s main office creates Form 2765 regarding a controlling person at a branch office for the CPA, the inspector for the main office sends a copy of the completed Form 2765 to the inspector for the branch office.

 

5462.1 Following Up with an Applicant or Permit Holder Who Does Not Return the Operation Action Form

March 2013

 

If an applicant or permit holder fails to return the Operation Action Form to Licensing by the compliance date specified on the form, the inspector contacts the applicant or permit holder to ensure that the ineligible person has been removed from the role of controlling person. (The Operation Action Form is located on the last page of CLASS Form 2765 Match of an Ineligible Controlling Person.)

If appropriate, the inspector takes one or more of the following actions:

  1. Cites an operation with a permit for a violation of TAC §§745.911(1), 748.103(12), 749.103(16), or 750.103(10), as applicable, when the violation is for a sustained controlling person.
  2. Cites an operation with a permit for a violation of TAC §745.911(2) when the violation is because an adverse action sustained within the previous five years makes the person ineligible to apply for a permit.
  3. Cites an operation with a permit for a violation of TAC §745.911(3) when the violation is because the person is associated with an operation that had its permit denied, revoked, suspended, or terminated by another state health and human services agency within the last 10 years.
  4. Revokes the permit.
  5. Denies the permit.

40 TAC §§745.907; 745.911; 745.915

Texas Government Code §531.953

 

5470 Additional Duties of Inspectors in Relation to Controlling Persons

March 2017

 

In addition to the duties explained in 5400 Controlling Person, inspectors also are responsible for the following:

  1. Monitoring operations for compliance with the requirements related to an operation’s controlling persons in statute, administrative rules, and minimum standards (see 4000 Inspections).
  2. Ensuring that a person who is ineligible to be a controlling person at an operation that is regulated by Licensing does not serve in the role of a controlling person (see 7773.4 Reviewing the Status of a Sustained Controlling Person in CLASS).
  3. Notifying controlling persons about corrective or adverse action taken against an operation (see 7110 Notifying an Operation When Licensing Takes Enforcement Action).
  4. Designating a controlling person (see 7771 Choosing the Persons to Designate as Controlling).
  5. Sustaining a designated controlling person (see 7770 Administrative Review and Due Process Hearing for a Designated Controlling Person).