Kentucky Statutes 45.238 – Powers and duties of Department of Revenue to collect referred debts — Cost-ineffective debts — Treatment of collected debts — Annual report
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(1) Debts that are certified by an agency or by a local government as provided in KRS
45.237 shall be referred to the department for collection. The department shall be vested with all the powers necessary to collect any referred debts.
(2) (a) For those debts deemed unfeasible or cost ineffective to pursue, the department shall maintain written records of the debt and the reason the debt was deemed unfeasible or cost ineffective to pursue.
(b) In the case of agencies, these debts shall be written off in accordance with administrative regulations promulgated under the authority of subsection (6) of this section.
(c) In the case of local governments, these debts shall be returned to the referring local government for further action.
(3) (a) All certified debts of agencies received by the department after the sixty (60) day collection period allowed in KRS § 45.237(4), and all certified debts of a local government received by the department after the ninety (90) day collection period allowed by KRS § 45.237(5), shall be subject to:
1. Interest at the tax interest rate determined under KRS § 131.183 on the amount of the debt plus all accruals authorized by law, from the date the debt is certified to the department until it is satisfied; and
2. A one (1) time twenty-five percent (25%) collection fee imposed on the amount of the debt plus all accruals authorized by law, as of the time of referral.
(b) The department may retain the collection fee.
(c) In the case of agencies and the Court of Justice, recovered funds and interest may, at the discretion of the secretary of the Finance and Administration Cabinet, be returned to the agency certifying the debt or improper payment or to the Court of Justice for allocation as otherwise provided by law. If the recovered funds and interest are not returned to the agency or Court of Justice, the amounts shall be deposited in the budget reserve trust fund established in KRS § 48.705, except for Medicaid benefits and funds required by law to be remitted to a federal agency.
(d) In the case of local governments, recovered funds and interest shall be returned to the referring local government for allocation as provided by ordinance, resolution, or as otherwise provided by law.
(4) The commissioner of the department may refer to the Attorney General any unsatisfied claim, demand, account, or judgment in favor of the Commonwealth for further civil or criminal action under KRS § 15.060.
(5) (a) The department shall report annually by October 1 to the Legislative Research Commission on all referred certified debts, including at least a summary of the debts by agency, fund type, and age, the latter compiled in the following four (4) categories:
1. Debts from ninety (90) to one hundred seventy-nine (179) days old;
2. Debts from one hundred eighty (180) to three hundred sixty-four (364)
days old;
3. Debts over one (1) year old but less than three (3) years old; and
4. Debts three (3) years old or older.
(b) The annual report shall also include the collection amount of the debts in paragraph (a) of this subsection and the accounts to which the amounts are credited.
(6) The department shall promulgate administrative regulations in accordance with KRS Chapter 13A to establish standards that agencies shall use in determining when to write debts off the books.
(7) This section shall not affect the collection of delinquent taxes by sheriffs or county attorneys under KRS § 91A.070 or 134.504.
Effective: June 25, 2013
History: Amended 2013 Ky. Acts ch. 88, sec. 4, effective June 25, 2013. — Amended
2008 Ky. Acts ch. 44, sec. 1, effective July 15, 2008. — Amended 2005 Ky. Acts ch.
85, sec. 62, effective June 20, 2005. — Created 2004 Ky. Acts ch. 192, sec. 2, effective April 21, 2004.
45.237 shall be referred to the department for collection. The department shall be vested with all the powers necessary to collect any referred debts.
Terms Used In Kentucky Statutes 45.238
- Action: includes all proceedings in any court of this state. See Kentucky Statutes 446.010
- Attorney: means attorney-at-law. See Kentucky Statutes 446.010
- Federal: refers to the United States. See Kentucky Statutes 446.010
- Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. Source: OCC
- written: means letters, words, or numbers, or their equivalent, set down by handwriting, typewriting, printing, photostating, photographing, magnetic impulse, mechanical or electronic recording, or other form of data compilation. See Kentucky Statutes 45.0005
- Year: means calendar year. See Kentucky Statutes 446.010
(2) (a) For those debts deemed unfeasible or cost ineffective to pursue, the department shall maintain written records of the debt and the reason the debt was deemed unfeasible or cost ineffective to pursue.
(b) In the case of agencies, these debts shall be written off in accordance with administrative regulations promulgated under the authority of subsection (6) of this section.
(c) In the case of local governments, these debts shall be returned to the referring local government for further action.
(3) (a) All certified debts of agencies received by the department after the sixty (60) day collection period allowed in KRS § 45.237(4), and all certified debts of a local government received by the department after the ninety (90) day collection period allowed by KRS § 45.237(5), shall be subject to:
1. Interest at the tax interest rate determined under KRS § 131.183 on the amount of the debt plus all accruals authorized by law, from the date the debt is certified to the department until it is satisfied; and
2. A one (1) time twenty-five percent (25%) collection fee imposed on the amount of the debt plus all accruals authorized by law, as of the time of referral.
(b) The department may retain the collection fee.
(c) In the case of agencies and the Court of Justice, recovered funds and interest may, at the discretion of the secretary of the Finance and Administration Cabinet, be returned to the agency certifying the debt or improper payment or to the Court of Justice for allocation as otherwise provided by law. If the recovered funds and interest are not returned to the agency or Court of Justice, the amounts shall be deposited in the budget reserve trust fund established in KRS § 48.705, except for Medicaid benefits and funds required by law to be remitted to a federal agency.
(d) In the case of local governments, recovered funds and interest shall be returned to the referring local government for allocation as provided by ordinance, resolution, or as otherwise provided by law.
(4) The commissioner of the department may refer to the Attorney General any unsatisfied claim, demand, account, or judgment in favor of the Commonwealth for further civil or criminal action under KRS § 15.060.
(5) (a) The department shall report annually by October 1 to the Legislative Research Commission on all referred certified debts, including at least a summary of the debts by agency, fund type, and age, the latter compiled in the following four (4) categories:
1. Debts from ninety (90) to one hundred seventy-nine (179) days old;
2. Debts from one hundred eighty (180) to three hundred sixty-four (364)
days old;
3. Debts over one (1) year old but less than three (3) years old; and
4. Debts three (3) years old or older.
(b) The annual report shall also include the collection amount of the debts in paragraph (a) of this subsection and the accounts to which the amounts are credited.
(6) The department shall promulgate administrative regulations in accordance with KRS Chapter 13A to establish standards that agencies shall use in determining when to write debts off the books.
(7) This section shall not affect the collection of delinquent taxes by sheriffs or county attorneys under KRS § 91A.070 or 134.504.
Effective: June 25, 2013
History: Amended 2013 Ky. Acts ch. 88, sec. 4, effective June 25, 2013. — Amended
2008 Ky. Acts ch. 44, sec. 1, effective July 15, 2008. — Amended 2005 Ky. Acts ch.
85, sec. 62, effective June 20, 2005. — Created 2004 Ky. Acts ch. 192, sec. 2, effective April 21, 2004.