BILL ANALYSIS Senate Research Center H.B. 2793 82R7633 ATP-F By: Hunter (Hinojosa) Administration 5/2/2011 Engrossed
BILL ANALYSIS
Senate Research Center H.B. 2793
82R7633 ATP-F By: Hunter (Hinojosa)
Administration
5/2/2011
Engrossed
Senate Research Center
H.B. 2793
82R7633 ATP-F
By: Hunter (Hinojosa)
Administration
5/2/2011
Engrossed
AUTHOR'S / SPONSOR'S STATEMENT OF INTENT Despite the fact that most hard-working Texans are fiscally responsible and live within their means, every now and then retailers, merchants, and their banking partners are forced to deal with dishonored payment devices, more commonly known as bounced checks. Current statute allows someone who holds a dishonored payment (such as a retailer, grocery store, merchant, bank, or check processing company) to charge the "drawer or endorser" a "reasonable processing fee of not more than $30." The processing fee serves as both a deterrent to writing bad checks and allows entities an opportunity to recover costs associated with processing bad checks. Unfortunately, the language in current statute has created some confusion in the business community regarding what constitutes a "reasonable" processing fee. The purpose of H.B. 2793 is to clarify current law and avoid any possible confusion regarding the reasonableness of the $30 processing fee by changing "a reasonable processing fee of not more than $30" to "a maximum processing fee of $30." This bill makes clear that the maximum processing fee will be no more than $30, and eliminates any sort of confusion or misinterpretation of the word "reasonable." H.B. 2793 amends current law relating to the processing fee charged for a dishonored payment device. RULEMAKING AUTHORITY This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 3.506(b), Business & Commerce Code, to authorize the holder's assignee, agent, or representative, or any other person retained by the holder to seek collection of the face value of a dishonored payment device, on return of the payment device to the holder following dishonor of the payment device by a payor, to charge the drawer or indorser a maximum processing fee of $30, rather than a reasonable processing fee of not more than $30. SECTION 2. Effective date: September 1, 2011.
AUTHOR'S / SPONSOR'S STATEMENT OF INTENT
Despite the fact that most hard-working Texans are fiscally responsible and live within their means, every now and then retailers, merchants, and their banking partners are forced to deal with dishonored payment devices, more commonly known as bounced checks.
Current statute allows someone who holds a dishonored payment (such as a retailer, grocery store, merchant, bank, or check processing company) to charge the "drawer or endorser" a "reasonable processing fee of not more than $30." The processing fee serves as both a deterrent to writing bad checks and allows entities an opportunity to recover costs associated with processing bad checks.
Unfortunately, the language in current statute has created some confusion in the business community regarding what constitutes a "reasonable" processing fee. The purpose of H.B. 2793 is to clarify current law and avoid any possible confusion regarding the reasonableness of the $30 processing fee by changing "a reasonable processing fee of not more than $30" to "a maximum processing fee of $30." This bill makes clear that the maximum processing fee will be no more than $30, and eliminates any sort of confusion or misinterpretation of the word "reasonable."
H.B. 2793 amends current law relating to the processing fee charged for a dishonored payment device.
RULEMAKING AUTHORITY
This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency.
SECTION BY SECTION ANALYSIS
SECTION 1. Amends Section 3.506(b), Business & Commerce Code, to authorize the holder's assignee, agent, or representative, or any other person retained by the holder to seek collection of the face value of a dishonored payment device, on return of the payment device to the holder following dishonor of the payment device by a payor, to charge the drawer or indorser a maximum processing fee of $30, rather than a reasonable processing fee of not more than $30.
SECTION 2. Effective date: September 1, 2011.