Agency: ISF - Administrative Services

Line Item: ISF - Office of State Debt Collection

Function

The Office of State Debt Collection (OSDC) had been an internal service fund (ISF) since 1995. In reality, however, it operated differently than other ISF agencies. Whereas internal service funds provide general services to other state agencies, the OSDC collects past due bills for other agencies, but charges its fees to debtors rather than customer agencies. To recognize the difference, the Legislature passed S.B. 214, Office of State Debt Collection Amendments, 2006 General Session, which changed the State Debt Collection Fund from an ISF to a restricted special revenue fund. The program contracts with private vendors to assist in collection of outstanding debt.

Statutory Authority

Created in UCA 63A-8-201, the office has the following duties:

• Overall responsibility for collecting and managing state receivables
• Develop policies for accounting, reporting, and collecting monies owed to the state
• Provide information and training to state agencies on collection-related topics
• Write an inclusive receivables management and collection manual
• Prepare quarterly and annual reports of the state's receivables
• Create and coordinate a state accounts receivable database
• Develop reasonable criteria to gauge agencies' efforts in maintaining an effective accounts receivables program and identify those agencies that are not making satisfactory progress
• Establish an automated cash receipt process between agencies
• Establish procedures for writing off accounts receivable
• Establish time limits after which an agency will delegate responsibility to collect debts to the office

Among other things, the office may:

• Collect reasonable attorney's fees and reasonable collection costs
• Collect debts for higher education entities if the entities agree
• Contract with private or state agencies to collect past-due accounts
• Obtain access to records of any state agency that are necessary
• Establish a fee to cover its administrative costs on accounts administered by the office
• Establish late penalty fees not higher than ten percent of the amount due
• Charge interest not higher than two percent above prime
• Accept payment by credit card under certain circumstances

UCA 63A-8-301 creates the restricted special revenue fund and requires that uncommitted monies in the fund be deposited in the General Fund at the end of each fiscal year. An annual report to the administrative services appropriations subcommittee on the fund balance, revenues, and expenditures is also required.

Funding Detail

Revenue is generated for the program by assessing an administrative fee against each collection. As a special revenue fund OSDC does not receive appropriations or tax funds.