(a) The department may impose an administrative penalty against a person who holds a permit or who is regulated under this chapter and who violates this chapter or a rule or order adopted under this chapter.
(b) The penalty for a violation may be in an amount not to exceed $10,000. Each day a violation continues or occurs is a separate violation for purposes of imposing a penalty.

(c) The amount of the penalty shall be based on:
(1) the seriousness of the violation, including the nature, circumstances, extent, and gravity of any prohibited acts, and the hazard or potential hazard created to the health, safety, or economic welfare of the public;
(2) the enforcement costs relating to the violation;
(3) the history of previous violations;
(4) the amount necessary to deter future violations;
(5) efforts to correct the violation; and
(6) any other matter that justice may require.
(d) If the department determines that a violation has occurred, the department shall issue an order that states the facts on which the determination is based, including an assessment of the penalty.
(e) Within 14 days after the date the order is issued, the department shall give written notice of the order to the person. The notice may be given by certified mail. The notice must include a brief summary of the alleged violation and a statement of the amount of the recommended penalty and must inform the person that the person has a right to a hearing on the occurrence of the violation, the amount of the penalty, or both the occurrence of the violation and the amount of the penalty.
(f) Within 20 days after the date the person receives the notice, the person in writing may accept the determination and recommended penalty of the department or may make a written request for a hearing on the occurrence of the violation, the amount of the penalty, or both the occurrence of the violation and the amount of the penalty.
(g) If the person accepts the determination and recommended penalty, the department by order shall impose the recommended penalty.
(h) If the person requests a hearing or fails to respond timely to the notice, the department shall refer the matter to the State Office of Administrative Hearings and an administrative law judge of that office shall hold the hearing. The department shall give written notice of the hearing to the person. The administrative law judge shall make findings of fact and conclusions of law and promptly issue to the department a written proposal for a decision about the occurrence of the violation and the amount of a proposed penalty. Based on the findings of fact, conclusions of law, and proposal for a decision, the department by order may find that a violation has occurred and impose a penalty or may find that no violation occurred.
(i) The notice of the department’s order given to the person under Chapter 2001, Government Code, must include a statement of the right of the person to judicial review of the order.
(j) Within 30 days after the date the department’s order is final as provided by Subchapter F, Chapter 2001, Government Code, the person shall:
(1) pay the amount of the penalty;
(2) pay the amount of the penalty and file a petition for judicial review contesting the occurrence of the violation, the amount of the penalty, or both the occurrence of the violation and the amount of the penalty; or
(3) without paying the amount of the penalty, file a petition for judicial review contesting the occurrence of the violation, the amount of the penalty, or both the occurrence of the violation and the amount of the penalty.
(k) Within the 30-day period, a person who acts under Subsection (j)(3) of this section may:
(1) stay enforcement of the penalty by:
(A) paying the amount of the penalty to the court for placement in an escrow account; or
(B) giving to the court a supersedeas bond that is approved by the court for the amount of the penalty and that is effective until all judicial review of the department’s order is final; or
(2) request the court to stay enforcement of the penalty by:
(A) filing with the court a sworn affidavit of the person stating that the person is financially unable to pay the amount of the penalty and is financially unable to give the supersedeas bond; and
(B) giving a copy of the affidavit to the department by certified mail.
(l) The department on receipt of a copy of an affidavit under Subsection (k)(2) may file with the court, within five days after the date the copy is received, a contest to the affidavit. The court shall hold a hearing on the facts alleged in the affidavit as soon as practicable and shall stay the enforcement of the penalty on finding that the alleged facts are true. The person who files an affidavit has the burden of proving that the person is financially unable to pay the amount of the penalty and to give a supersedeas bond.
(m) If the person does not pay the amount of the penalty and the enforcement of the penalty is not stayed, the department may refer the matter to the attorney general for collection of the amount of the penalty.
(n) Judicial review of the order of the department:
(1) is instituted by filing a petition as provided by Subchapter G, Chapter 2001, Government Code; and
(2) is under the substantial evidence rule.
(o) If the court sustains the occurrence of the violation, the court may uphold or reduce the amount of the penalty and order the person to pay the full or reduced amount of the penalty. If the court does not sustain the occurrence of the violation, the court shall order that no penalty is owed.
(p) When the judgment of the court becomes final, the court shall proceed under this subsection. If the person paid the amount of the penalty and if that amount is reduced or is not upheld by the court, the court shall order that the appropriate amount plus accrued interest be remitted to the person. The rate of the interest is the rate charged on loans to depository institutions by the New York Federal Reserve Bank, and the interest shall be paid for the period beginning on the date the penalty was paid and ending on the date the penalty is remitted. If the person gave a supersedeas bond and if the amount of the penalty is not upheld by the court, the court shall order the release of the bond. If the person gave a supersedeas bond and if the amount of the penalty is reduced, the court shall order the release of the bond after the person pays the amount.
(q) A penalty collected under this section shall be remitted to the comptroller for deposit in the general revenue fund.
(r) All proceedings under this section are subject to Chapter 2001, Government Code.