Section 1200.10  Title

 

This Part may be cited as the Debt Collection Bureau Rules.

 

Section 1200.20  Policy

 

It is the public policy of this State to aggressively pursue the collection of accounts or claims due and payable to the State of Illinois through all reasonable means. [30 ILCS 210/3]

 

Section 1200.30  Purpose and Implementation

 

a)         Pursuant to Public Act 93-0570, the Department of Revenue's Debt Collection Bureau shall serve as the primary debt collecting entity for the State and in that role shall collect debts on behalf of agencies of the State.  All debts owed the State of Illinois shall be referred to the Bureau, subject to such limitations established in this Part or otherwise imposed by law.  [30 ILCS 210/2]

 

b)         This Part establishes rules necessary and appropriate to implement Public Act 93-0570 and sets forth when and how the Bureau assumes responsibility under the Illinois State Collection Act of 1986 [30 ILCS 210] for the collection of the delinquent debt of State agencies. 

 

Section 1200.40  Application

 

a)         This Part applies to all debt collection by the Bureau pursuant to the authority granted it under the Act.

 

b)         To the extent that some other statute prescribes procedures for collection of particular types of accounts or claims owed to State agencies in conflict with the provisions of the Act, such other statute shall continue in full force and effect, and the debt collection provisions of the Act and this Part shall not apply. [30 ILCS 210/2]

 

c)         This Part does not apply to the Illinois Student Assistance Commission in the administration of its student loan programs. [30 ILCS 210/2]

 

d)         This Part does not apply to the Department of Public Aid with regard to child support debts, the collection of which is governed by the requirements of Title IV, Part D of the federal Social Security Act, except as provided in Section 1200.60(c). [30 ILCS 210/5(h)]

 

e)         This Part does not apply to the Department of Employment Security with regard to debts to any federal account, including but not limited to the Unemployment Trust Fund, and penalties and interest assessed under the Unemployment Insurance Act, except as provided in Section 1200.60(d). [30 ILCS 210/5(h-1)]

 

Section 1200.50  Definitions

 

As used throughout this Part, each term defined in this Section shall have the meaning set forth in this Section, unless its use clearly requires a different meaning.

 

"Accounts receivable", "receivables", or "State agency accounts receivable" shall mean amounts due a State agency that are legally enforceable, that have not been lawfully certified as uncollectible, and for which there is no legal barrier to referral to the Bureau.

 

"Act" shall mean the Illinois State Collection Act of 1986 [30 ILCS 210].

 

"Bureau" shall mean the Debt Collection Bureau of the Illinois Department of Revenue.

 

"Certified collection specialist" or "collection specialist" shall mean an individual who has provided to the Bureau adequate documentation of training, experience, and expertise in the field of collection of public debt and has been certified by the Bureau as a collection specialist.  A certified collection specialist may be an individual employed directly by the Bureau or one employed by a private collection firm.

 

"Certified debt" shall mean delinquent debt that has been certified by the referring agency and accepted for collection by the Bureau, as provided in this Part.

 

"Delinquent debt" shall mean a debt to the State or any of its agencies that is owed by any person or entity, that is $10 or more, and that is more than 90 days past due.  The following debts shall not be considered delinquent for purposes of this definition:

 

debts that are the subject of pending administrative or judicial review;

 

debts that are covered by an informal or formal payment agreement, so long as the debtor is current in payments under the terms of the payment agreement.

 

"Referring agency" shall mean the State agency that refers delinquent debt to the Bureau for collection.

 

"State agency" shall have the meaning found in the Illinois State Auditing Act [30 ILCS 5/1-7].

 

Section 1200.60  Referral of Delinquent Debt

 

a)         Beginning July 1, 2004 for the Departments of Public Aid and Employment Security and July 1, 2005 for universities and other State agencies, State agencies shall refer to the Bureau all debt owed to the State, provided that the debt satisfies the requirements for referral of delinquent debt as established in this Part. [30 ILCS 210/3]  This Part shall apply to all such debt referrals.

 

b)         The debt collection provisions of the Act and this Part may be utilized by the General Assembly, the Supreme Court and the several courts of this State, and the constitutionally elected State Officers, at their discretion, provided that the debt satisfies the requirements for referral of delinquent debt as established in this Part. [30 ILCS 210/2]

 

c)         While this Part does not apply to the Department of Public Aid with regard to child support debts, the collection of which is governed by the requirements of Title IV, Part D of the federal Social Security Act, the Department of Public Aid may refer child support debts to the Bureau, provided that the debt satisfies the requirements for referral of delinquent debt as provided in this  Section.  All such referred debt shall remain an obligation under the Department of Public Aid's Child Support Enforcement Program subject to the requirements of Title IV, Part D of the federal Social Security Act, including the continued use of federally mandated enforcement remedies and techniques by the Department of Public Aid. [30 ILCS 210/5(h), 10(g)]

 

d)         While this Part does not apply to the Department of Employment Security with regard to debts to any federal account, including but not limited to the Unemployment Trust Fund, and penalties and interest assessed under the Unemployment Insurance Act, the Department of Employment Security may refer those debts to the Bureau, provided that the debt satisfies the requirements for referral of delinquent debt as provided in this Part. [30 ILCS 210/5(h-1), 10(g-1)]

 

e)         Prior to referring delinquent debt to the Bureau, and anytime thereafter upon the request of the Bureau, the referring agency shall collect and provide to the Bureau  the following information:

 

1)         about the debt:

 

A)        the amount of the delinquent debt (including fees, penalties, and interest);

 

B)        the date the debt was incurred;

 

C)        a brief description of the type of the debt;

 

D)        a summary of all action taken to collect the debt to date; and

 

E)        any other information concerning the debt within its possession needed by the Bureau to perform its responsibilities under the Act and this Part, as requested by the Bureau.

 

2)         about the debtor:

 

A)        for individuals, the identity of the debtor, including name, address, and social security number;

 

B)        for business debtors, the name and type of business organization, the business address, the federal employers identification number, and the names, addresses, and social security numbers of the owners and officers of the business; and

 

C)        any other information concerning the debtor within its possession needed by the Bureau to perform its responsibilities under the Act and this Part, as requested by the Bureau.

 

f)         Upon the request of the Bureau, the referring agency shall promptly deliver to the Bureau a copy of all records relating to the debt, with a status report describing all collection action taken by the referring agency.

 

g)         Upon acceptance by the Bureau of delinquent debt from a referring agency, the provisions of Section 7 of the Illinois State Collection Act shall be rendered null and void as to that debt, and the Debt Collection Board (Board) shall promptly deliver to the Bureau a copy of all records in its possession relating to that debt, with a status report describing all collection action taken by the Board and an accounting of all payments received. [30 ILCS 210/8]

 

h)         For each debt referred to the Bureau, the referring agency shall retain all documents and records relating to or supporting the existence of the debt.  The debtor shall have no right to a hearing before the Bureau to contest the validity of the debt.  In the event a debtor would raise a reasonable doubt as to the validity of the debt, the Bureau may in its discretion refer the debt back to the referring agency for further review and recommendation. [30 ILCS 210/10(f)]

 

i)          All debt referred to the Bureau for collection shall remain the property of the referring agency and an obligation to the account owed.  [30 ILCS 210/5(i)]

 

Section 1200.70  Debt Accepted for Collection

 

The Bureau will accept for collection delinquent debt that meets the following criteria, unless the debt is otherwise excluded from collection by the Bureau under the Act or this Part:

 

a)         The debt has been certified to the Bureau by the referring agency as provided in Section 1200.90; 

 

b)         The referring agency has notified the debtor of the amount and basis for the debt, the potential for referral of the debt to the Bureau, and the procedure and time limitations for contesting to the referring agency the validity of the debt;

 

c)         The debtor did not contest the debt in writing within 90 days from the date the referring agency provided notice of the debt to the debtor;

 

d)         The debt has been transmitted to the Bureau in a format approved by it; and

 

e)         The debt is not of the type listed in Section 1200.80.

 

Section 1200.80  Debt Not Accepted for Collection

 

The Bureau will not accept for collection the following types of debt:

 

a)         debt secured by an interest in real property [30 ILCS 210/5(j)];

 

b)         receivables currently the subject of an ongoing wage levy, whether that levy is the result of a judgment entered in circuit court or an administrative levy issued without judgment;

 

c)         receivables currently the subject of litigation being pursued in the State of Illinois through the Office of the Attorney General, State's Attorneys' Offices or, where authorized by the Attorney General, by private counsel retained on behalf of the agency;

 

d)         debt that has been discharged in bankruptcy or that is currently in bankruptcy proceedings;

 

e)         receivables not reported on the Illinois Office of the Comptroller Receivables Report;

 

f)         debt owed to any federal account, including, but not limited to, federally regulated pension trust funds, unless otherwise provided under this Part;

 

g)         deferred receivables, as defined in the Comptroller's Receivables Report;

 

h)         loans, contracts, and agreements of any kind with other governmental entities;

 

i)          debt that was referred to a private collection firm by the referring agency prior to July 1, 2005, and that has been with that firm for 90 days or less;

 

j)          debt that has been deemed uncollectible, absent factual assertions by the referring agency that, due to circumstances not known at the time the delinquent debt was deemed uncollectible, additional collection efforts are warranted [30 ILCS 210/10(e)];

 

k)         debt for which it would not be in the State's best economic interest for the Bureau to assume collection responsibility, as determined by the Bureau. 

 

Section 1200.90  Certification of Debt

 

a)         The Bureau shall not accept debt for collection unless that debt has been certified by the referring agency as provided in this Section.

 

b)         The referring agency shall provide to the Bureau for each delinquent debt that it refers for collection a certification that contains the following:

 

1)         a statement that the debt qualifies for referral to, and collection by, the Bureau, as provided by the Act and this Part;

 

2)         a statement that there are no legal restrictions relating to collection of the debt by the Bureau;

 

3)         a statement that the referring agency has notified the debtor of the amount and basis for the debt, the procedure and time limitations for contesting the validity of the debt to the referring agency, and the potential for referral of the debt to the Bureau; and

 

4)         a statement that the debtor did not dispute the debt in writing to the referring agency within 90 days after the date of notice of the debt by the referring agency.

 

c)         The certification shall be executed by a person who is authorized to issue, certify, and approve vouchers for the agency under Sections 10 and 11 of the State Finance Act [30 ILCS 105/10 and 11].  Such person may delegate to a responsible person or persons the authority to execute the certification required by this Section.

 

Section 1200.100  Collection of Certified Debt

 

a)         Once the certified debt is accepted for collection, the Bureau shall make every reasonable effort to collect the debt using all collection tools available, including, but not limited to, the Comptroller's Offset System and the employment of private collection agencies, as well as its own collections personnel. [30 ILCS 210/10(a)]  As part of its collection efforts, the Bureau may direct the referring agency to place the certified debt with the Comptroller's Offset System or to enter into a repayment plan with the debtor.

 

b)         The Bureau shall have the sole authority to let contracts with private collection agencies for the collection of debt referred to and accepted by the Bureau under this Part. [30 ILCS 210/10(b)]

 

1)         Any contract with a private collection firm for the collection of debt referred to and accepted by the Bureau under this Part shall be let pursuant to the provisions of the Illinois Procurement Code [30 ILCS 500] and the Standard Procurement Rules (44 Ill. Adm. Code 1).  Selection of private collection firms by the Bureau shall be made through the Procurement Code's request for proposal process.

 

2)         Any such contract shall specify that the private collection agency's fee shall be on a contingency basis and that the private collection agency shall not be entitled to collect a contingency fee for any debt collected through the efforts of any State or federal offset system. [30 ILCS 210/10(b)]

 

3)         Any such contract let after the effective date of this rulemaking should provide that debt referred to the firm for which there have been no payments or other activity must be returned to the agency after 180 days.

 

4)         The referring agency shall be responsible for working directly with the private collection firm in the placement of its certified debt and for providing to the private collection firm information in its possession concerning the certified debt and the debtor, as provided in Section 1200.60(e) of this Part, or as directed by the Bureau.

 

5)         The Bureau shall be responsible for managing and monitoring the collection performance of the private collection firms in regard to debt collected on its behalf.

 

c)         The Bureau may employ individuals who are certified as collection specialists to perform the requirements of this Part, subject to funding by the General Assembly.

 

d)         Private collection firms and individuals employed by the Bureau must demonstrate that they are qualified by training and experience to undertake these collection efforts.  In the case of an employment agency, the individuals who would perform the collection services must be so qualified.  Upon determination by the Bureau that the individuals are so qualified, the Bureau shall certify the individuals as collection specialists.  

 

e)         Upon agreement of the Attorney General, the Bureau may contract for legal assistance in collecting past due accounts.  Any contract entered into under this Section before August 20, 2003, shall remain valid but may not be renewed. [30 ILCS 210/7]

 

f)         The Attorney General and the State Comptroller may assist in the debt collection efforts of the Bureau, as requested by the Department of Revenue. [30 ILCS 210/10(i)]

 

g)         Collection methods employed by the Bureau may vary with the size and nature of the debt. 

 

h)         If reasonable collection efforts prove unavailing, the Bureau may declare the delinquent debt uncollectible and return it to the referring agency as provided in Section 1200.110.

 

Section 1200.110  Uncollectible Debt

 

a)         The Bureau shall deem delinquent debt, which it has accepted for collection, uncollectible when it has exhausted all reasonable collection efforts. 

 

b)         Prior to deeming any delinquent debt uncollectible, the Bureau shall document efforts to accomplish the following collection objectives:

 

1)         confirm the current location of the debtor;

 

2)         locate evidence of the debtor's assets; and

 

3)         use all reasonable and available collections tools to collect the delinquent debt.

 

c)         Once a debt is deemed by the Bureau to be uncollectible, the Bureau shall return the debt to the referring agency, which shall then write the debt off as uncollectible or return the debt to the Bureau for additional collection efforts. [30 ILCS 210/10(e)]

 

d)         The Bureau shall refuse to accept debt that has been deemed uncollectible by the Debt Collection Board, the Office of the Comptroller, or the Bureau, absent factual assertions from the referring agency that, due to circumstances not known at the time the debt was deemed uncollectible, the debt is worthy of additional collection efforts. [30 ILCS 210/10(d)]

 

Section 1200.120  Deposit of Amounts Collected

 

a)         Any amounts collected under this Part, including amounts collected by outside collection firms under contract with the Bureau, and including any amount that results in overpayment of the delinquent debt, shall be deposited in, or transferred to the appropriate funds, as specified by statute.

 

1)         Allocation of the amounts collected and deposited in the appropriate funds shall be the responsibility of the referring agency. 

 

2)         The referring agency shall bear the responsibility for adjusting overpayments.

 

b)         After payment of fees pursuant to the Bureau's contracts with private collection agencies, 20% of all amounts collected by the Bureau, excluding amounts collected on behalf of the Departments of Public Aid and Revenue, shall be deposited into the Debt Collection Fund. All remaining amounts collected shall be deposited into the General Revenue Fund unless the amounts are owed to any State fund or funds other than the General Revenue Fund. [30 ILCS 210/10(h)]

 

c)         Collections arising from referrals from the Department of Public Aid

under Section 1200.60(c) shall be deposited into such fund or funds as the Department of Public Aid shall direct, in accordance with the requirements of Title IV, Part D of the federal Social Security Act, applicable provisions of State law, and the rules of the Department of Public Aid.  [30 ILCS 210/10(h)]

 

d)         Collections arising from referrals from the Department of Employment Security under Section 1200.60(d) shall be deposited into the fund or funds that the Department of Employment Security shall direct, in accordance with the requirements of Section 3304(a)(3) of the federal Unemployment Tax Act, Section 303(a)(4) of the federal Social Security Act, and the Unemployment Insurance Act.  [30 ILCS 210/10(h)]

 

Section 1200.130  Appropriations from Debt Collection Fund 

 

Moneys in the Debt Collection Fund shall be appropriated only for the administrative costs of the Bureau.  On the last day of each fiscal year, unappropriated moneys and moneys otherwise deemed unneeded for the next fiscal year remaining in the Debt Collection Fund may be transferred into the General Revenue Fund at the Governor's reasonable discretion. [30 ILCS 210/10(h)]

 

Section 1200.140  Obligations Subject to Appropriation

 

The Bureau's obligations under this Part shall be subject to appropriation by the General Assembly.  [30 ILCS 210/10(l)]

 

Section 1200.150  Recordkeeping and Reporting

 

a)         The Bureau shall notify the referring agency within 60 days after the collection of a delinquent debt, or any portion thereof, collected by the Bureau's own collection specialists. 

 

b)         The Bureau shall maintain documentation of the efforts undertaken to collect certified debt and the results of those efforts for a period of three years after its collection efforts on that debt ceased. 

 

c)         The Director of the Department of Revenue shall report annually to the General Assembly and State Comptroller upon the debt collection efforts of the Bureau.  Each report shall include an analysis of the overdue debts owed to the State. [30 ILCS 210/10(j)]

 

d)         The reporting requirements of this Part are in addition to any reporting required by the Comptroller, and the debt reporting requirements established by the Comptroller shall be followed by all State agencies.  [30 ILCS 210/2]