| (a) State payee participation in electronic funds transfer
system.
(1) Payee disclosure of state payee EFTS account information.
The state payee must establish, change, or cancel state payee EFTS
account information by providing EFTS authorization to a custodial
state agency.
(2) EFTS forms. The state payee must obtain EFTS forms
from the payee's paying state agency.
(3) State payee may elect to authorize payment by EFT.
A state payee may choose to receive payment by EFT by providing EFTS
authorization. A state payee's choice not to provide EFTS authorization
constitutes notice to the comptroller to receive payment by warrant
as provided in Government Code, §403.016(h)(1).
(4) Payment destination confirmation. At the time of
electing to participate in the EFTS, a state payee must confirm whether
payments they receive will be forwarded to a financial institution
outside of the United States. A state payee must also notify the paying
state agency of any change to the intended final destination of a
payment or payments outside of the United States.
(5) Refusal to accept an EFT payment. A state payee
may refuse to accept an EFTS payment in accordance with NACHA rules.
(6) Refusal of reversal. The state payee may not instruct
their financial institution to reject a reversal made by the comptroller
to correct an erroneous credit entry.
(7) Cancellation of state payee EFTS authorization.
The cancellation of a state payee's EFTS authorization terminates
the state payee's participation in the ETFS until the state payee
provides a new EFTS authorization.
(8) Comptroller may issue warrant. The comptroller
may issue a payment to a state payee by warrant in lieu of EFT pursuant
to applicable law, including Government Code, §403.016(i).
(b) Number of EFTS accounts. The comptroller may limit
the number EFTS accounts that a state payee may designate for payment
by EFTS, subject to the comptroller's policy and procedure.
(c) EFTS authorization.
(1) The state payee must provide EFTS authorization
to establish, change, or cancel instructions for EFT payments by providing
account information by:
(A) submitting an EFT authorization with a state payee's
agreement on a comptroller approved form; or
(B) providing an agreement to a custodial state agency
or a paying state agency in a manner deemed appropriate by that agency
and the comptroller, and as required by law and NACHA rules.
(2) Upon receipt of an EFTS authorization, the comptroller
will issue a warrant to a state payee during the time when prenotification
is used to verify the account information is correct.
(3) A state payee may request to bypass prenotification
by certifying to the custodial state agency that:
(A) the state payee requests to bypass prenotification;
(B) the state payee has verified the account information
with the financial institution; and
(C) the state payee is solely responsible for the consequences
of providing erroneous account information that may result in rejection,
delay, or loss of an EFTS payment.
(4) The custodial state agency must provide written
notification to the comptroller that the state payee has requested
to bypass prenotification for EFT payments under paragraph (3) of
this subsection.
(5) If the state payee's financial institution rejects
the state payee's account information, neither the comptroller, the
custodial state agency, or the paying state agency is liable for the
consequences of the rejection.
(6) If the comptroller receives an EFTS authorization
or other notification to cancel a state payee's account information,
the state payee's participation in the EFTS terminates until the custodial
state agency or the comptroller receives a new EFTS authorization
from the state payee.
(7) To facilitate proper EFT payments in accordance
with NACHA rules or other regulations, the comptroller may change
or cancel a state payee's account information without prior notice
to the state payee.
(8) The comptroller or custodial state agency may cancel
a state payee's account information without prior notice to the state
payee.
(d) Credit of EFTS payments.
(1) A payment is credited to a state payee EFTS account
on the effective date of the credit entry regardless of when the receiving
depository financial institution posts the credit.
(2) If payment is rejected or posted late by the receiving
depository financial institution, the comptroller, a paying state
agency, or a custodial state agency are not liable for any additional
late payment interest, including under Government Code, Chapter 2251,
or late fees or charges, including those that may be imposed by the
state payee or receiving depository financial institution.
(e) EFTS initiation of reversals and reclamations.
(1) Only a paying state agency may request that the
comptroller initiate a reversal or reclamation.
(2) A paying state agency must request a reversal or
reclamation through the comptroller in the comptroller's prescribed
manner.
(3) A paying state agency shall not initiate a reversal
for an EFTS payment initiated by the comptroller on behalf of the
paying state agency.
(4) A paying state agency shall not initiate a reclamation
entry for an EFTS payment initiated by the comptroller on behalf of
the paying state agency.
(5) The comptroller may initiate a reversal for a state
payroll or retirement payment or a reclamation for a retirement or
benefit payment only in compliance with NACHA rules.
(6) Failure to make funds available by a state payee
or state payee's beneficiary for a reversal or reclamation entry initiated
by the comptroller results in a debt under Government Code, §403.055.
(f) Reversal.
(1) Notice to comptroller. A paying state agency must
submit to the comptroller a request for a reversal no later than five
banking days after the effective date of the erroneous credit entry
in accordance with comptroller procedures and NACHA rules.
(2) A receiving depository financial institution:
(A) may only accept a reversal entry from the comptroller
for an erroneous credit entry initiated by the comptroller on behalf
of a paying state agency; and
(B) in accordance with NACHA rules, shall not act upon
instructions from the state payee to reject a reversal entry.
(3) Notice to state payee. A paying state agency must
notify a state payee of a reversal entry no later than the effective
date of the reversal in accordance with NACHA rules.
(4) Unsuccessful reversal entry.
(A) If the RFDI does not honor the comptroller's reversal
entry, the state payee must reimburse the erroneous credit entry amount
to the paying state agency.
(B) If the state payee fails to reimburse the paying
state agency for the erroneous credit entry amount, the state payee
will owe the amount of the erroneous credit entry as a debt to the
state under Government Code, §403.055.
(C) A paying state agency shall report to the comptroller
any state payee who fails to reimburse the paying state agency for
any erroneous credit entry amounts, as required by Government Code, §403.055(f)
and (g).
(g) Reclamation.
(1) A paying state agency must submit EFTS reclamation
requests to the comptroller for processing within five business days
of notification of the death or legal incapacity of the state payee
or beneficiary of the state payee.
(2) The comptroller may initiate a reclamation request
on behalf of the paying state agency to reclaim any amounts transmitted
to the state payee's account after the state payee's death or legal
incapacity, or the death of a beneficiary of the state payee.
(3) The comptroller must provide prior approval to
allow a paying state agency to initiate a reclamation entry for a
credit entry which the comptroller initiated on behalf of a paying
state agency.
(4) In accordance with NACHA rules, if the reclamation
request is returned by the receiving depository financial institution,
the comptroller may submit a written demand for payment of the reclamation
request within fifteen days on behalf of the paying state agency.
(5) Unsuccessful reclamation entry.
(A) If the RFDI does not honor the comptroller's reclamation
entry, the state payee or the state payee's beneficiary must reimburse
the reclamation entry amount to the paying state agency.
(B) If the state payee or the state payee's beneficiary
fails to reimburse the paying state agency for the reclamation entry
amount, the state payee or the state payee's beneficiary will owe
the reclamation entry amount as a debt to the state under Government
Code, §403.055.
(C) A paying state agency shall report to the comptroller
any state payee or state payee's beneficiary who fails to reimburse
the paying state agency for any reclamation entry amounts, as required
by Government Code, §403.055(f) and (g).
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