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Collection Of State Debts

Concerning the collection of debts owed to the state, and, in connection therewith, making and reducing an appropriation.
2021 Regular Session
State Government
Bill Summary

The act repeals the central collection services section (CSS) in the division of finance procurement in the department of personnel, which section was the centralized collection agency for state debts of many state agencies. Thereafter, all state agencies will be responsible for collecting their own debts. The act modifies the collection of state debts by:

  • Repealing CSS and specifying that each state agency is responsible for collecting debts owed to it;
  • Shifting rule-making responsibility related to debt collection from the executive director of the department of personnel to the state controller (controller);
  • Permitting a state agency to certify a debt to the department of revenue, so that the department may deduct the debt from a state tax refund or lottery winnings;
  • Permitting a state agency to certify a debt to the registry operator under the "Gaming Payment Intercept Act", so that the registry operator may deduct the debt from limited gaming winnings;
  • Permitting a state agency to refer a debt to a private counsel or private collection agency;
  • Requiring the controller to include in the fiscal rules requirements for a state agency to refer a debt to private counsel or a private collection agency or to certify a debt to the department of revenue;
  • Eliminating the ability of the state to collect a debt on behalf of a political subdivision;
  • Repealing the requirement that there be written notice and an opportunity for a hearing prior to a tax refund offset being implemented;
  • Eliminating the controller and state treasurer's authority to write off a debt due to the state, so that they only have authority to release or compromise such a debt;
  • Transferring the balance in the debt collection fund to the general fund and then repealing the fund;
  • Authorizing the controller to determine the priority of debts for which amounts will be withheld from disbursements, instead of requiring a pro rata distribution, which cannot be done with decentralized debt collection;
  • Repealing the vendor offset implementation fund, which currently has no balance;
  • Repealing the requirement that the controller establish performance policies and standards for measuring a state agency's debt collection;
  • Repealing the controller's debt collection fee;
  • Requiring the controller, without consultation of others, to select the private counsel or private collection agencies, instead of the executive director of the department of personnel with consultation of others;
  • Eliminating specification for applying a court-ordered award that is insufficient to cover a state debt, so that such disposition is left to the court order;
  • Repealing a written notice to debtors that specifies the amount of the debt, including the itemization of any fees, and the name of the creditor to whom the debt is owed; and
  • Repealing the authority for the department of personnel to enter into a reciprocal agreement with the United States government or another state to offset debts and allowing the department of revenue to enter into such reciprocal agreements.
    (Note: This summary applies to this bill as enacted.)


Became Law


Bill Text

The effective date for bills enacted without a safety clause is August 7, 2024, if the General Assembly adjourns sine die on May 8, 2024, unless otherwise specified. Details