34 TAC §5.58
The Comptroller of Public Accounts proposes new §5.58,
concerning recovery of certain state agency overpayments. A brief description
of the new section follows.
Subsection (a) defines important terms used in the section.
Subsection (b) specifies the scope of the recovery audit program, including
the criteria for determining whether a state agency is exempt from the program.
Subsection (c) requires a state agency to cooperate fully with the recovery
audit program. The subsection also specifies the circumstances under which
a state agency may direct a consultant not to pursue recovery of a payment
that the consultant considers to be an overpayment.
Subsection (d) governs the deposit of money recovered by a state agency
under the recovery audit program.
John Heleman, Chief Revenue Estimator, has determined that for the first
five-year period the rule will be in effect, there will be no foreseeable
implications relating to costs or revenues of the state or local governments.
Mr. Heleman also has determined that for each year of the first five years
the rule is in effect, the public benefit anticipated as a result of adopting
the rule will be helping administer the program to detect and recover certain
overpayments made by state agencies. The rule would not have an adverse effect
on small businesses or micro-businesses. There is no significant economic
cost to individuals who are required to comply with the rule.
Comments on the proposal may be addressed to Joani Bishop, Manager of Claims
Division, P.O. Box 13528, Austin, Texas 78711. If a person wants to ensure
that the comptroller considers and responds to a comment made about this proposal,
then the person must ensure that the comptroller receives the comment not
later than the 30th day after the issue date of the
Texas Register
in which this proposal appears. If the 30th day is a
state or national holiday, Saturday, or Sunday, then the first workday after
the 30th day is the deadline.
The new section is proposed under Government Code, §2115.003.
The new section implements Government Code, Chapter 2115.
§5.58.Recovery of Certain State Agency Overpayments.
(a)
Definitions. In this section:
(1)
"Consultant" means a person with which the comptroller
has contracted under Government Code, Chapter 2115.
(2)
"Investment vehicle" does not include real property.
(3)
"Overpayment" has the meaning assigned by Government Code, §2115.001(1).
(4)
"Recovery audit program" means the program established
by the comptroller under Government Code, Chapter 2115, to recover vendor
overpayments made by state agencies.
(5)
"Retiree" means an individual who has been granted a retirement
benefit under Government Code, Title 8, Subtitle B, C, D, E, or H.
(6)
"Retirement benefit" includes a service retirement benefit,
a disability retirement benefit, an occupational disability retirement benefit,
a nonoccupational disability retirement benefit, and a death benefit paid
by or on behalf of a retirement system.
(7)
"Retirement system" means the Employees Retirement System
of Texas, the Teacher Retirement System of Texas, the optional retirement
program, the Judicial Retirement System of Texas Plan One, the Judicial Retirement
System of Texas Plan Two, or the Texas Emergency Services Retirement System.
(8)
"State agency" has the meaning assigned by Government Code, §2115.001(2).
(9)
"State employee" means an officer or an employee of a state
agency. The term does not include an independent contractor.
(10)
"USAS" means the uniform statewide accounting system.
(11)
"Vendor payment" does not include:
(A)
a payment from money held outside the state treasury if
the payment was not reported to USAS as a cash expenditure;
(B)
a payment that already has been cancelled, recalled, refunded,
or otherwise recovered;
(C)
a payment that was made by warrant if it has not yet been
negotiated;
(D)
a payment of the compensation earned by a state employee;
(E)
a payment of a retirement benefit by or on behalf of a
retirement system;
(F)
the refund by or on behalf of a retirement system of a
member's accumulated contributions to the system;
(G)
a payment of the amount deducted from:
(i)
the compensation earned by a state employee; or
(ii)
the payment by or on behalf of a retirement system of
a retirement benefit or the refund of a member's accumulated contributions;
(H)
a payment to an individual because of the individual's
unemployment, under the Texas Unemployment Compensation Act, Labor Code, Title
4, Subtitle A;
(I)
a payment to a governmental entity of this state, including
a state agency, a municipality, a county, a public school district, a public
school, or a political subdivision;
(J)
a payment made by the Texas Department of Insurance in
connection with the receivership of an insurance company;
(K)
a payment for the purchase of a security or other investment
vehicle, except that the term includes a payment of a commission or similar
fee concerning the purchase;
(L)
a payment of principal or interest, except that the term
includes any interest paid under Government Code, Chapter 2251;
(M)
a payment of the premium to provide group insurance coverage
for state employees or retirees;
(N)
a payment to a private person to administer a group insurance
program for state employees or retirees;
(O)
a payment of a loan to a private person if, as of the date
of the payment, the entire amount of the loan is required to be repaid;
(P)
a payment of a judgment against the state or a state agency
or a payment to settle litigation involving the state or a state agency;
(Q)
a payment made by a person that is not a state agency;
or
(R)
any other type of payment that the comptroller determines
is not a vendor payment because the projected costs of including the payment
type in the recovery audit program exceeds the projected amount of the recoveries
from including the payment type in the program.
(b)
Scope of the recovery audit program.
(1)
Except as provided in paragraph (2) of this subsection,
the recovery audit program applies to each state agency and each vendor payment
made by a state agency.
(2)
The recovery audit program does not apply to a state agency
or any vendor payment made by the agency during a state fiscal year if:
(A)
the total amount of the agency's cash expenditures during
the immediately preceding two state fiscal years was equal to or less than
$100 million, as reported to USAS;
(B)
the total amount of the agency's vendor payments during
the immediately preceding two state fiscal years was less than 20% of the
total amount of the agency's cash expenditures during those years, as reported
to USAS; or
(C)
the total amount of the agency's vendor payments during
the immediately preceding two state fiscal years was less than $62.5 million,
as reported to USAS.
(c)
Cooperation with the recovery audit program.
(1)
A state agency that is subject to the recovery audit program
shall cooperate fully with:
(A)
any requirement of the comptroller established or adopted
under Government Code, Chapter 2115; and
(B)
any requirement of a consultant if the requirement is established
or adopted pursuant to the recovery audit program.
(2)
A state agency may direct a consultant not to pursue recovery
of a payment that the consultant determines was an overpayment if:
(A)
the agency determines that the payment was not in fact
an overpayment and the comptroller agrees with the agency's determination;
or
(B)
the comptroller determines that recovery of the overpayment
would not be in the best interests of the state.
(d)
Deposit of amounts recovered.
(1)
A state agency that recovers money as a result of a recovery
audit conducted under Government Code, Chapter 2115, shall deposit the money
as required by applicable law, including the State Funds Reform Act, Government
Code, Chapter 404, Subchapter F. This paragraph applies only if:
(A)
the agency did not receive the money from the federal government
before expending the money; and
(B)
the federal government did not reimburse the agency for
the expenditure.
(2)
A state agency that recovers money as a result of a recovery
audit conducted under Government Code, Chapter 2115, shall deposit the money
as required by applicable law, including the State Funds Reform Act, Government
Code, Chapter 404, Subchapter F, and federal law. This paragraph applies only
if:
(A)
the agency received the money from the federal government
before expending the money; or
(B)
the federal government reimbursed the agency for the expenditure.
This agency hereby certifies that the proposal
has been reviewed by legal counsel and found to be within the agency's legal
authority to adopt.
Filed with the Office of
the Secretary of State on February 14, 2006.
TRD-200600756
Martin Cherry
Chief Deputy General Counsel
Comptroller of Public Accounts
Earliest possible date of adoption: April 2, 2006
For further information, please call: (512) 475-0387