JKM H.B. 567 75(R)BILL ANALYSIS ECONOMIC DEVELOPMENT H.B. 567 By: Oliveira 2-27-97 Committee Report (Amended) BACKGROUND The Texas Workforce Commission (commission) periodically reviews the Texas Unemployment Compensation Act for needed updates, revisions, and deletions. This bill is the result of recommendations made by the departments of the Commission which administer the unemployment compensation and tax programs following a comprehensive review of the unemployment compensation and taxing provisions of the Texas Unemployment Compensation Act. PURPOSE H.B. 567 deletes obsolete taxable wage amounts and a reference to an obsolete provision of the Internal Revenue Code. It allows money in the special administration fund to be spent to enforce child labor, payment of wages, and minimum wage law and to pay for outsourcing certain tax collections. It allows all employers to designate a special address for mail service. It increases the period for protesting an initial claim for benefits from 12 to 14 days and allows a claims examiner to correct a clerical or machine error anytime during a claimant's benefit year. It makes the collateral estoppel doctrine inapplicable to all findings, conclusions, judgments, or orders under the Texas Unemployment Compensation Act. It tolls the running of the statute of limitations during bankruptcy or specified administrative proceedings. It allows the Commission to pay the cost of abstracting a notice of assessment and add it to the amount due under the assessment. It deletes the requirement that sums owed by employers to the Commission be reduced to final judgment before they can be considered debts owed to the state to withhold a state warrant. It simplifies the levy provisions of the Texas Unemployment compensation Act. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 201.082 of the Labor Code by removing several obsolete provisions. It deletes obsolete references to the taxable wage amounts for 1988 and 1989 from Subdivision (1). It deletes a reference to an obsolete provision of the Internal Revenue Code from Paragraph (5)(C). SECTION 2. Amends Subsection 203.202(a) of the Labor Code to expand the purposes for which money in the special administration fund can be used. It amends Subdivision 2 to allow the principal in the fund, not just the interest, to be used to pay the cost of administering Chapters 51, 61, and 62 of the Labor Code. It adds a new Subdivision 6 allowing money in the fund to be expended to pay contractors to collect delinquent unemployment taxes, penalties and interest. SECTION 3. Amends Section 208.003 of the Labor Code. It amends the Section's title. It amends Subsection (a) to allow any employer, not just governmental employers, to designate to the commission an address for mail service. It amends Subsection (b) to provide that, if an employer designates a mailing address under Subsection (a), mailing notice of claims, determinations or other decisions to that address constitutes notice to the employer. SECTION 4. Amends Subsection 208.004(b) of the Labor Code to increase the period for protesting claims from 12 to 14 days. SECTION 5. Amends Subsection 212.054(a) of the Labor Code to allow an examiner to issue a redetermination correcting a clerical or machine error anytime during a claimant's benefit year. SECTION 6. Amends Section 213.007 of the Labor Code to make the collateral estoppel doctrine inapplicable to all findings of fact, conclusions of law, judgments or final orders made by the Texas Workforce Commission under Subtitle A, Title 4 of the Labor Code. SECTION 7. Amends Section 213.033 of the Labor Code to agree with language in the state taxation code. It amends Subsection (a) to add interest as an item subject to a three-year statute of limitations. It adds Subsection (b), which suspends the running of the three year limitations period while an administrative proceeding dealing with the tax debt was pending before the commission or while the tax debtor was in bankruptcy. It adds Subsection (c), which provides for the resumption of the limitations period after a proceeding described by Subsection (b). SECTION 8. Amends Section 213.036 of the Labor Code to allow the cost of abstracting an assessment to be added to a judgment or assessment owed by a tax debtor. It amends the Section's title. It amends Subsection (a) to add the fee for filing and recording an abstract of assessment to the costs for which the commission may pay county clerks. It adds a new Subsection (b) providing that the fee paid under Subsection (a) can be added to the amount due under the judgment or assessment. SECTION 9. Amends Section 213.054 of the Labor Code by deleting the requirement that taxes, interest, penalties or court costs must be reduced to judgment before they constitute a debt owed the state to withhold a state warrant under Section 403.055 of the Government Code. SECTION 10. Amends Section 213.059 of the Labor Code. Amends Subsection (a) to allow the Commission to notify by regular mail, rather than registered mail, a person who is the holder of a tax debtor's assets, or who owes a debt to a tax debtor. It amends Subsection (e) to provide that a notice under this section that attempts to prohibit the transfer or disposition of an asset possessed or controlled by a bank is effective if it is delivered or mailed to any office of the bank, including the office of the bank at which the deposit is carried or the property is held. It amends Subsection (g) to authorize the commission, anytime during a 60-day period, to levy on an asset or debt and require the possessor thereof to transfer the asset to the commission or pay the amount owed by the tax debtor to the commission. Subsection (h) is amended to make the notice of levy effective against after-acquired assets for a period of 60 days after its service. SECTION 11. Effective date: September 1, 1997, and applicable to claims filed on or after that date. SECTION 12. Emergency clause EXPLANATION OF AMENDMENTS Amendment #1. Makes contracting by the commission for the collection of delinquent unemployment taxes subject to the provisions of Chapter 2107 of the Government Code.