While no sweeping collections changes were put into place, uncollectable fines and fees and jail credits were addressed by the 87th Texas Legislature, along with a bill that corrected unintended consequences from past collections-related legislation.
Senate Bill 346 passed in 2019 presented several challenges, observed Jim Lehman, former collection program manager for the Texas Office of Court Administration. Lehman, CEO/special consultant with The jwLehman Group, served as a consultant for the Governmental Collectors Association of Texas (GCAT) during the last session, said GCAT President Andrea Weilacher, Denton County collections manager.
Lawmakers passed Senate Bill 1923 during the 87th Session to correct the following from the 86th Session: As passed, the effective date of SB 346 left a gap between statutes repealed by the bill and the effective date of the replacement statutes. SB 346 also moved the “time payment fee” from the Local Government Code to the Code of Criminal Procedure, Lehman reported. The Local Government Code definition of conviction includes deferred dispositions and deferred adjudications. The Code of Criminal Procedure did not. The technical impact of that was the time payment fee no longer applied to deferred dispositions or adjudications, which was never the intent, Lehman surmised. SB 1923 corrected those issues.
Senate Bill 1373, the Uncollectable Fines and Fees Bill, allows jurisdictions to declare criminal court assessments uncollectable if the defendant is deceased or serving life in prison, or the fine has been unpaid for 15 years, Lehman explained. This bill also requires the court to inquire about financial ability on the record.
“It is important to note that the ‘uncollectable’ portion of this bill is permissive, meaning it is not mandatory,” Lehman pointed out. “Courts and jurisdictions are not required to declare cases uncollectable. If they choose to do so, this bill codifies the format for that process.”
House Bill 569, the Jail Credits Bill, gives defendants credit for time served ($150/day) for “fine only” misdemeanor convictions any time the defendant is confined in jail or prison while serving a sentence for another offense, if that confinement occurred after the commission of the misdemeanor, Lehman detailed. The bill also requires notice to defendants before issuing a warrant that they may be entitled to credits for other misdemeanor convictions.
“This bill could impact inmate trust collections for a number of justice and municipal court offenses,” Lehman observed.
Legislation that did not pass but raised concern for GCAT included House Bill 4191 and House Bill 1177, both of which attempted to “neutralize” the Department of Public Safety’s Failure to Appear (FTA) program, Lehman stated. The OmniBase/FTA program denies the renewal of a driver’s license for failure to appear in court or to comply with a court order to satisfy fines and fees (see Weilacher’s column). OmniBase Services of Texas maintains and administers the central database for the cities and counties contracted to use the FTA program.
The program is voluntary, Lehman emphasized. Licenses are not immediately suspended, as with many other state programs. Rather, the offenders usually have time to reconcile their issues before their driver’s license is up for renewal.
Outsourcing Collections
The 87th Texas Legislature did not pass any bills that directly affect outsourcing collections. However, the previous two Legislatures did.
The Texas Legislature has given counties the authority to assess a 30 percent fee on a delinquent fine or fee when contracting with a private attorney or public vendor to improve collection of balances more than 60 days past due.
The 86th Texas Legislature extended county authority to include the collection of past due alcohol beverage license fees owed to the county utilizing a third party.
“Concerns have been raised regarding the lack of protections in place for cities and counties when an establishment that is permitted or licensed to sell alcoholic beverages falls behind on the payment of local permit or license fees,” as explained in the House Bill 3754 bill analysis. “While the Texas Alcoholic Beverage Commission is able to cancel the permit or license of such an establishment, it has been noted that cities and counties have little recourse to recoup the delinquent fees. HB 3754 seeks to provide a mechanism for the collection of these fees by a city, town, or county.”
Effective Sept. 1, 2019, the Alcoholic Beverage Code was amended to allow cities and counties to contract with a third-party vendor for collection of the fee once it becomes 60 days late. The bill also authorized the third-party vendor to assess a collection fee in addition to collecting the fee owed to the city or county.
Legislation passed by the 85th Legislature also affected third-party collections.
In 2017, lawmakers established a new statute that reads as follows: Communication to a defendant from a public or private vendor contracted to provide collection services for unpaid fines and court costs must include:
- notice of the person’s right to enter a plea or to demand trial on any offense; and
- a statement that if the person is unable to pay the full amount that is acceptable to the court to resolve the case, the person should contact the court regarding alternatives to full payment.
Several counties have opted to outsource their delinquent collections resulting in increased revenue, among other benefits.
“When we recognized that the law was amended to provide for a collection vendor at no cost to the county, we considered contracting with a collection firm,” shared Parker County Pct. 4 Justice of the Peace Kirk D. Martin, whose court uses Perdue Brandon Fielder Collins & Mott‚ LLP. “The way the law was set up made it the ideal situation to make the move.
“Having the resource of an organization with a well-established history brought a peace of mind knowing that particular needs of the court would be met,” Martin continued. Numerous defendants have contacted the court to resolve their cases. In addition, the law firm notifies the court when an individual on the docket is deceased or incarcerated.
“This allows us to ‘clean up’ our docket so we have a better reflection of what is owed to the county,” Martin articulated. In summary, the contract arrangement has resulted in a decrease in workload for court staff, increased revenue, and judicial efficiency.
McLennan County Pct. 3 Justice of the Peace David Pareya has been serving as judge for 43 years. In fact, Pareya and his clerk developed the first software used by a collection agency to assist the McLennan County courts.
When the Texas Department of Public Safety did away with the Warrant Data Bank, this meant a statewide mechanism to executing pending warrants on citations that were overdue in court no longer existed.
“We did not have the manpower on the local level to serve delinquent warrants on delinquent cases,” Pareya explained.
The McLennan County Pct. 3 Justice of the Peace Court contracted with Linebarger Goggan Blair & Sampson, LLP.
“We have had great success with the firm’s assistance in disposing of our delinquent cases,” Pareya maintained, “thus relieving the courts and defendants of going through the in-court proceedings. I would highly recommend that any official, with regard to collections of fines and fees, do some intensive research with all of the different entities that are available and see which ones fit the justice court’s needs,” Pareya concluded.
The main reason Wharton County JP offices choose to outsource collections was manpower, shared Wharton County Pct. 4 Justice of the Peace Timmy Drapela and clerk Dawn Merta. All but one of the JP offices in Wharton County are one-clerk offices.
“There was not enough time to dedicate to collections,” Drapela and Merta stated. The county contracted with Graves Humphries Stahl, Ltd. (GHS).
“The county benefits a great deal because GHS pays to have all notices printed, and they pay for all the postage when mailing notices,” Drapela and Merta commented. “This saves our county quite a bit of money. With them actively working our collections, it frees up the clerk’s time to handle all the normal, day-to-day court business.”
The court also uses NetData (iCON) for management software.
“Since NetData and GHS are housed together, we have up-to-date collection record attempts,” Drapela and Merta added. “We see when they speak with defendants, and they see when we have contact with the defendant. It is a great partnership.”
Jim Lehman is the former Collection Program Manager for the Texas Office of Court Administration where he spent eighteen years successfully implementing and maintaining the state’s court Collection Improvement Program and providing collections assistance and consultation to more than 2,700 courts statewide. He is credited with assisting state and local governments see an estimated increase in revenues of more than $1 Billion. He is also a veteran of nine State of Texas legislative sessions assisting with bill development, analysis, and evaluation as well as strategic planning, policy implementation, and project management. Jim previously supervised the Dallas County Criminal Courts Collection Department and has more than twenty years of private sector collections experience. For more information, contact Lehman at 512-585-1555, jim@lehmansolutions.com, or go to www.jwlehmangroup.com.