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RULE §5.57Use of Payment Cards by State Agencies

(a) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise.

  (1) Consulting service--Has the meaning assigned by §5.54 of this title (relating to Consulting Services Contracts).

  (2) Executive director--The individual who is the chief administrative officer of a state agency. The term excludes a member of a governing body.

  (3) Executive head--

    (A) the elected or appointed state official who is authorized by law to administer a state agency that is not headed by a governing body; or

    (B) the executive director of a state agency that is headed by a governing body.

  (4) Institution of higher education--Has the meaning assigned by Education Code, §61.003, other than a public junior college.

  (5) Payment card--A credit or charge card issued to an officer or employee of a state agency for the purpose of allowing the officer or employee to purchase goods or services for the agency.

  (6) Payment card purchase--The use of a payment card to pay for the purchase of a good or a service.

  (7) State agency--

    (A) a board, commission, department, or other agency in the executive branch of state government that is created by the constitution or a statute of this state, including an institution of higher education;

    (B) the legislature or a legislative agency; or

    (C) the supreme court, the court of criminal appeals, a court of appeals, or a state judicial agency.

(b) Applicability of this section. Except as provided in subsection (c) of this section, this section applies to a state agency's use of a payment card regardless of the type of funds the agency uses to pay the payment card issuer.

(c) Exemptions.

  (1) This section does not apply to a state agency if a law other than Government Code, §403.023, specifically authorizes, requires, prohibits, or otherwise regulates the agency's use of a payment card.

  (2) This section does not apply to the extent its application would affect a contract in which a state agency is a party. This paragraph applies only if the contract was in effect on September 1, 1993.

  (3) This section does not apply to the extent its application would violate a constitutional prohibition against a law that impairs a contractual obligation.

  (4) This section does not apply to the extent necessary to avoid an irreconcilable conflict with a federal law or regulation.

  (5) This section does not apply to the use of a payment card to pay for a travel expense incurred by a state officer or employee while conducting official state business.

(d) Effect of noncompliance with this section. The comptroller may suspend or terminate a state agency's authority to use a payment card if the comptroller determines that the agency or an officer or employee of the agency has violated this section.

(e) Procurement of payment card services by the comptroller.

  (1) The comptroller may contract with a payment card issuer on behalf of any state agency that chooses to participate in the contract.

  (2) A state agency may not use a payment card to pay for a purchase unless the card was issued under a contract between a payment card issuer and the comptroller.

  (3) A state agency may begin making payment card purchases only after the agency has complied with the procedural requirements of the comptroller.

(f) Adoption of procedures by state agencies. A state agency shall adopt reasonable procedures governing the issuance and security of payment cards and the use of those cards by the agency's officers and employees. Upon request, the agency shall make the procedures available to the comptroller for review.

(g) Prohibited uses of payment cards. A state agency may not use a payment card and may not reimburse an officer or employee for the use of a payment card for:

  (1) a purchase of a personal nature or any other purchase not connected with official state business;

  (2) a cash advance;

  (3) a purchase of a consulting service;

  (4) a purchase of a good or a service that may not be purchased without the prior approval of another state agency;

  (5) a purchase that the comptroller audits before payment; or

  (6) a purchase from a vendor if a payment to it is prohibited by:

    (A) Government Code, §403.055 or §2107.008;

    (B) Education Code, §57.48, or §57.482; or

    (C) Family Code, §231.007.

(h) Applicability of purchasing requirements. The use of a payment card to pay for a purchase does not automatically exempt a state agency or its officers and employees from any purchasing requirement of state law or the comptroller.

(i) Payments to payment card issuers. A state agency shall pay a payment card issuer through an electronic funds transfer.

(j) Refunds. A state agency may not accept a cash refund for a purchase if the agency paid for the purchase with a payment card.

(k) Lost or stolen payment cards. The state employee that had custody of a payment card immediately before it was lost or stolen shall report the loss or theft to the payment card issuer according to its requirements.

(l) Disputed charges. A state agency shall dispute any incorrect charge that appears on an invoice the agency receives from a payment card issuer. When disputing the charge, the agency shall comply with applicable law and the issuer's requirements.

(m) Taxes. A state agency or a state employee shall properly claim any available exemption from paying a state or federal tax that is assessed on a payment card purchase.

(n) Responsibilities and notification of state employees.

  (1) A state employee shall ensure that each of the employee's payment card purchases comply with applicable state law and this section.

  (2) The executive head of a state agency shall notify the agency's employees about the requirements of this section.

(o) Fiscal year determination. The fiscal year that must be charged for a purchase is not affected by the use of a payment card to pay for the purchase. For example, a state agency that pays a payment card issuer for a service purchased by the agency must charge the payment to the fiscal year in which the service was rendered.

(p) Prohibition against excess obligations. A state agency that uses a payment card to pay for a purchase should be careful not to violate any provision in the General Appropriations Act about the incurrence of excess obligations.

(q) Purchase document and receipt requirements.

  (1) A purchase document that a state agency submits to the uniform statewide accounting system for a payment to a payment card issuer must comply with the comptroller's general requirements for the submission of those documents. In addition, the document must:

    (A) provide the transaction charge and the appropriate Texas identification number on the detail lines;

    (B) provide the Texas identification number and name of the payment card issuer on the remittance line; and

    (C) contain any other information the comptroller considers necessary.

  (2) A state agency shall keep in its files any receipt that a vendor issues to the agency for a payment card purchase. The receipt must contain a description of the good or service purchased that is sufficient to support the expenditure object code used by the agency. The agency shall make the receipt available to the comptroller upon request.

Source Note: The provisions of this §5.57 adopted to be effective November 15, 1995, 20 TexReg 9190; amended to be effective December 3, 2002, 27 TexReg 11163; amended to be effective November 9, 2008, 33 TexReg 8945; amended to be effective January 9, 2019, 44 TexReg 269

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