28 Tex. Admin. Code § 33.401 - Entrance Fee Escrow Accounts

(a) The provider of a facility which was unoccupied on September 1, 1987, and for which continuing care contracts have been or will be entered into on or after September 1, 1987, shall establish an entrance fee escrow account with a bank or trust company located in this state, as escrow agent. The provider subject to this section shall establish the entrance fee escrow account before entering into a reservation agreement or a continuing care contract, and accepting an entrance fee or a reservation agreement deposit. The entrance fee escrow account shall be maintained in an account separate from the provider's business account and must be fully covered by federal deposit insurance or secured by the United States Government.

(b) When the provider receives a refundable reservation agreement deposit, an entrance fee, or a portion of an entrance fee from a resident or prospective resident, the funds shall be deposited in the entrance fee escrow account. The provider shall give the resident or prospective resident a written receipt for the funds. The provider shall then deliver a copy of the receipt together with the funds to the escrow agent for deposit within 72 hours of the provider's receipt. The written receipt given to the resident or prospective resident for the funds shall include the information that the provider must deposit the funds in the escrow account within 72 hours of receipt, in addition to the name and address of the escrow agent.

(c) At any time upon the request of the resident or prospective resident, the provider, or the commissioner, the escrow agent shall issue a statement indicating the status of a resident or prospective resident's balance in the entrance fee escrow account. The written receipt given to the resident shall also include the following statement: "At your request, the escrow agent must provide a statement indicating the status of your balance in the entrance fee escrow account."

(d) Accrued interest on the entrance fee escrow account shall be the property of the provider unless otherwise provided in the continuing care contract.

(e) This section does not apply to any nonrefundable portion of an entrance fee or reservation agreement deposit that does not exceed 2.0% of the amount required as the entrance fee and that is clearly designated as nonrefundable in the relevant continuing care contract or reservation agreement.

Notes

28 Tex. Admin. Code § 33.401

The provisions of this §33.401 adopted to be effective March 9, 1989, 14 TexReg 990; amended to be effective March 1, 1990, 15 TexReg 879; amended to be effective March 14, 1996, 21 TexReg 1769.