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RULE §59.2Collection Process: Uniform Guidelines and Referral of Delinquent Collections

similar terms as contained in the proposed contract. If the attorney general declines or is unable to perform the services requested, the attorney general may approve the contract. If the attorney general decides that the agency has not complied with this subsection, the attorney general may:

        (I) decline to approve the contract; or

        (II) require the agency to submit or resubmit a proposal to the attorney general for collection of the obligation in accordance with this subsection.

      (ii) If the attorney general fails to act as set forth in clause (i) of this subparagraph within 60 days of receipt of the proposed contract or receipt of additional information requested, the attorney general is deemed to have approved the contract in accordance with this rule.

    (B) Requirements of proposed contracts with private persons presented for attorney general approval. In addition to information required by other state laws, all contracts for collection of delinquent obligations must contain or be supported by a proposal containing the following:

      (i) a description of the obligations to be collected sufficient to enable the attorney general to determine what measures are necessary to attempt to collect the obligation(s);

      (ii) explicit terms of the basis of any fee or payment for the collection of the obligation(s);

      (iii) a description of the individual accounts to be collected in the following respects:

        (I) the total number of delinquent accounts;

        (II) the dollar range;

        (III) the total dollar amount;

        (IV) a summary of the collection efforts previously made by the agency; and

        (V) the legal basis of the delinquent obligations to be collected.

    (C) Suggested requirements of proposed contracts with private persons presented for attorney general approval. All contracts for collection of delinquent obligations should contain provisions stating the following:

      (i) that litigation on the delinquent account is prohibited unless the private person obtains specific written authorization from the agency and the attorney general and complies with the requirements of this rule;

      (ii) that the person is required to place any funds collected in an interest bearing account with amounts collected, plus interest, less collections costs, payable to the agency on a monthly basis or by direct deposit to the agency's account on a weekly basis with the agency billing once a month; in either case a listing of the accounts and amounts collected per account should be submitted to the agency upon deposit of the funds;

      (iii) that the person refer any bankruptcy notice to the agency within three working days of receipt;

      (iv) that the agency may recall any account without charge;

      (v) that the person may not settle or compromise the account for less than the full amount owed (including collection costs where authorized by statute or terms of the obligation) without written authority from the agency;

      (vi) that the person is not an agent of the agency but is an independent contractor; and providing further that the person will indemnify the agency for any loss incurred by his violation of state and federal debt collection statutes or by the negligence of the person, his employees or agents;

      (vii) that any dispute arising under the contract be submitted to a court of competent jurisdiction in Texas, unless any other venue is statutorily mandated, in which case the specific venue statute will apply, subject to any alternative dispute resolution procedures adopted by the agency pursuant to Chapter 2009, Texas Government Code.

Source Note: The provisions of this §59.2 adopted to be effective December 11, 1992, 17 TexReg 8283; amended to be effective October 23, 2001, 26 TexReg 8339; amended to be effective November 22, 2012, 37 TexReg 9085

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