Texas House Bill HB632

Texas 2019 - 86th Regular

Caption

Relating to a pilot program for the recovery of delinquent state obligations owed to certain state agencies.

Impact

If implemented, this bill could significantly affect the state's financial management and revenue system by enabling more effective collection of debts owed to state agencies. The contractor designated by the attorney general would not only collect outstanding debts but could also sue debtors, file liens, and enter payment agreements, thus expanding the tools available for recovery. This could enhance the financial stability of programs reliant on state funding currently hindered by delinquent accounts.

Summary

House Bill 632 establishes a pilot program to improve the recovery of delinquent state obligations owed to various state agencies. The bill mandates that the attorney general contract with one or more entities tasked with identifying and collecting these debts. The focus is on nontax delinquent obligations, and the program will initially assess which state agencies have the highest percentages of recoverable debts to participate. This structure aims to streamline the collection process and enhance state revenue from previously uncollected obligations.

Contention

A notable aspect of HB 632 concerns the addition of a cost recovery fee, which is set at 30% of the total amount due on the date of referral to the contractor. This fee has the potential to lead to increased financial burdens on debtors, which could be a point of contention among legislators and the public. Additionally, the requirement that state agencies provide a final notice before referring debts and the ability for debtors to challenge such referrals may temper concerns about the aggression of debt recovery processes. Overall, this legislative initiative aims to address a recurring issue within state finances while carefully weighing the implications for affected individuals and state agencies.