By Zaffirini                                     S.B. No. 676

      75R4147 KKA-D                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to the prevention and recovery of benefits granted in

 1-3     error under the food stamp program and the program of financial

 1-4     assistance for persons with dependent children.

 1-5           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-6           SECTION 1.  Sections 466.407(a) and (c), Government Code, are

 1-7     amended to read as follows:

 1-8           (a)  The executive director shall deduct the amount of a

 1-9     delinquent tax or other money from the winnings of a person who has

1-10     been finally determined to be:

1-11                 (1)  delinquent in the payment of a tax or other money

1-12     collected by the comptroller[, the state treasurer,] or the Texas

1-13     Alcoholic Beverage Commission;

1-14                 (2)  delinquent in making child support payments

1-15     administered or collected by the attorney general;

1-16                 (3)  delinquent in reimbursing the Texas Department of

1-17     Human Services for a benefit granted in error under the food stamp

1-18     program or the program of financial assistance under Chapter 31,

1-19     Human Resources Code;

1-20                 (4)  in default on a loan made under Chapter 52,

1-21     Education Code; or

1-22                 (5) [(4)]  in default on a loan guaranteed under

1-23     Chapter 57, Education Code.

1-24           (c)  The attorney general, comptroller, [state treasurer,]

 2-1     Texas Alcoholic Beverage Commission, Texas Department of Human

 2-2     Services, Texas Higher Education Coordinating Board, and Texas

 2-3     Guaranteed Student Loan Corporation shall each provide the

 2-4     executive director with a report of persons who have been finally

 2-5     determined to be delinquent in the payment of a tax or other money

 2-6     collected by the agency.  The commission shall adopt rules

 2-7     regarding the form and frequency of reports under this subsection.

 2-8           SECTION 2.  Subchapter B, Chapter 531, Government Code, is

 2-9     amended by adding Section 531.047 to read as follows:

2-10           Sec. 531.047.  MINIMUM COLLECTION GOAL.  (a)  Before August

2-11     31 of each year, the commission by rule shall set a minimum goal

2-12     for the Texas Department of Human Services that specifies the

2-13     percentage of the amount of benefits granted by the department in

2-14     error under the food stamp program or the program of financial

2-15     assistance under Chapter 31, Human Resources Code, that the

2-16     department should recover.  The commission shall set the percentage

2-17     based on comparable recovery rates reported by other states.

2-18           (b)  If the department fails to meet the goal set under

2-19     Subsection (a) for the fiscal year, the commissioner shall request

2-20     budget execution during the succeeding fiscal year for the transfer

2-21     of money from the department's operating budget to another health

2-22     and human services agency.  The amount requested to be transferred

2-23     is the amount equal to the difference between the amount the

2-24     department would have collected had the department met the goal and

2-25     the amount the department actually collected.

2-26           (c)  The commission, the governor, and the Legislative Budget

2-27     Board shall monitor the department's performance in meeting the

 3-1     goal set under this section.  The department shall cooperate by

 3-2     providing to the commission, the governor, and the Legislative

 3-3     Budget Board, on request, information concerning the department's

 3-4     collection efforts.

 3-5           SECTION 3.  Chapter 22, Human Resources Code, is amended by

 3-6     adding Sections 22.0251-22.0254 to read as follows:

 3-7           Sec. 22.0251.  TIMELY DETERMINATION OF ERRORS.  (a)  Subject

 3-8     to the approval of the commissioner of health and human services,

 3-9     the department shall:

3-10                 (1)  determine and record the elapsed time taken by the

3-11     department to discover an error in making a grant under the food

3-12     stamp program or the program of financial assistance under Chapter

3-13     31;

3-14                 (2)  set progressive goals for reducing the discovery

3-15     time described by Subdivision (1); and

3-16                 (3)  adopt a schedule to meet the goals set under

3-17     Subdivision (2).

3-18           (b)  Each fiscal quarter, the department shall submit to the

3-19     governor, the Legislative Budget Board, and the Health and Human

3-20     Services Commission a report detailing the department's progress in

3-21     reaching its goals under Subsection (a)(2).

3-22           Sec. 22.0252.  TELEPHONE COLLECTION PROGRAM.  (a)  The

3-23     department shall use the telephone to attempt to collect

3-24     reimbursement from a person who receives a benefit granted in error

3-25     under the food stamp program or the program of financial assistance

3-26     under Chapter 31.

3-27           (b)  The department shall submit to the governor, the

 4-1     Legislative Budget Board, and the Health and Human Services

 4-2     Commission a semiannual report on the operation and success of the

 4-3     telephone collection program.

 4-4           Sec. 22.0253.  PARTICIPATION IN FEDERAL TAX REFUND OFFSET

 4-5     PROGRAM.  The department shall participate in the Federal Tax

 4-6     Refund Offset Program (FTROP) to attempt to recover benefits

 4-7     granted by the department in error under the food stamp program.

 4-8     The department shall submit as many claims that meet program

 4-9     criteria as possible for offset against income tax returns.

4-10           Sec. 22.0254.  PROSECUTION OF FRAUDULENT CLAIMS.  (a)  The

4-11     department shall keep a record of the dispositions of referrals

4-12     made by the department to a district attorney concerning fraudulent

4-13     claims for benefits under the food stamp program or the program of

4-14     financial assistance under Chapter 31.

4-15           (b)  The department shall:

4-16                 (1)  obtain status information biweekly from the

4-17     appropriate district attorney on each major fraudulent claim

4-18     referred by the department;

4-19                 (2)  request a written explanation from the appropriate

4-20     district attorney for each case referred in which the district

4-21     attorney declines to prosecute; and

4-22                 (3)  encourage the creation of a special welfare fraud

4-23     unit in each district attorney's office that serves a municipality

4-24     with a population of more than 250,000, to be financed by amounts

4-25     provided by the department.

4-26           (c)  A district attorney shall cooperate in providing

4-27     information requested by the department under this section.

 5-1           (d)  The department by rule shall define what constitutes a

 5-2     major fraudulent claim under Subsection (b)(1).

 5-3           SECTION 4.  Section 22.027, Human Resources Code, is amended

 5-4     by amending Subsection (b) and adding Subsection (e) to read as

 5-5     follows:

 5-6           (b)  The department shall:

 5-7                 (1)  aggressively publicize successful fraud

 5-8     prosecutions and fraud-prevention programs through all available

 5-9     means, including the use of  statewide press releases issued in

5-10     coordination with the Health and Human Services Commission; and

5-11                 (2)  establish and promote a toll-free hotline for

5-12     reporting suspected fraud in programs administered by the

5-13     department.

5-14           (e)  The department shall submit to the governor, the

5-15     Legislative Budget Board, and the Health and Human Services

5-16     Commission a semiannual report on the results of computerized

5-17     matching of department information with information from

5-18     neighboring states, if any, and information from the Texas

5-19     Department of Criminal Justice.

5-20           SECTION 5.  Chapter 22, Human Resources Code, is amended by

5-21     adding Section 22.0291 to read as follows:

5-22           Sec. 22.0291.  EMBASSY INFORMATION MATCHING SYSTEM.  (a)  The

5-23     department shall, through the use of a computerized matching

5-24     system, compare department information relating to applicants for

5-25     and recipients of food stamps and financial assistance under

5-26     Chapter 31 with information obtained from an embassy relating to

5-27     immigrants and visitors to the United States from the country

 6-1     represented by the embassy for the purpose of preventing

 6-2     individuals from unlawfully receiving public assistance benefits

 6-3     administered by the department.

 6-4           (b)  In beginning to carry out the duties under this section,

 6-5     the department shall share and compare information with the

 6-6     embassies that represent countries that have the most citizens

 6-7     residing in this state.

 6-8           (c)  The department may enter into an agreement with an

 6-9     embassy as necessary to implement this section.

6-10           (d)  The department and embassies sharing information under

6-11     this section shall protect the confidentiality of the shared

6-12     information in compliance with all existing state and federal

6-13     privacy guidelines.

6-14           (e)  The department shall submit to the governor, the

6-15     Legislative Budget Board, and the Health and Human Services

6-16     Commission a semiannual report on the operation and success of the

6-17     embassy matching system.

6-18           SECTION 6.  Subtitle B, Title 2, Human Resources Code, is

6-19     amended by adding Chapter 23 to read as follows:

6-20               CHAPTER 23.  SUSPENSION OF LICENSE FOR FAILURE

6-21                           TO REIMBURSE DEPARTMENT

6-22           Sec. 23.001.  DEFINITIONS.  In this chapter:

6-23                 (1)  "License" means a license, certificate,

6-24     registration, permit, or other authorization that:

6-25                       (A)  is issued by a licensing authority;

6-26                       (B)  is subject before expiration to suspension,

6-27     revocation, forfeiture, or termination by an issuing licensing

 7-1     authority; and

 7-2                       (C)  a person must obtain to:

 7-3                             (i)  operate a motor vehicle; or

 7-4                             (ii)  engage in a recreational activity,

 7-5     including hunting and fishing, for which a license or permit is

 7-6     required.

 7-7                 (2)  "Order suspending a license" means an order issued

 7-8     by the department directing a licensing authority to suspend a

 7-9     license.

7-10           Sec. 23.002.  LICENSING AUTHORITIES SUBJECT TO CHAPTER.  In

7-11     this chapter, "licensing authority" means:

7-12                 (1)  the Parks and Wildlife Department; and

7-13                 (2)  the Department of Public Safety of the State of

7-14     Texas.

7-15           Sec. 23.003.  SUSPENSION OF LICENSE.  The department may

7-16     issue an order suspending a license as provided by this chapter of

7-17     a person who, after notice:

7-18                 (1)  has failed to reimburse the department for an

7-19     amount in excess of $250 granted in error to the person under the

7-20     food stamp program or the program of financial assistance under

7-21     Chapter 31;

7-22                 (2)  has been provided an opportunity to make payments

7-23     toward the amount owed under a repayment schedule; and

7-24                 (3)  has failed to comply with the repayment schedule.

7-25           Sec. 23.004.  INITIATION OF PROCEEDING.  (a)  The department

7-26     may initiate a proceeding to suspend a person's license by filing a

7-27     petition with the department's hearings division.

 8-1           (b)  The proceeding shall be conducted by the department's

 8-2     hearings division.  The proceeding is a contested case under

 8-3     Chapter 2001, Government Code, except that Section 2001.054 does

 8-4     not apply.

 8-5           (c)  The commissioner shall render a final decision in the

 8-6     proceeding.

 8-7           Sec. 23.005.  CONTENTS OF PETITION.  A petition under this

 8-8     chapter must state that license suspension is authorized under

 8-9     Section 23.003 and allege:

8-10                 (1)  the name and, if known, social security number of

8-11     the person;

8-12                 (2)  the type of license the person is believed to hold

8-13     and the name of the licensing authority; and

8-14                 (3)  the amount owed to the department.

8-15           Sec. 23.006.  NOTICE.  (a)  On initiating a proceeding under

8-16     Section 23.004, the department shall give the person named in the

8-17     petition:

8-18                 (1)  notice of the person's right to a hearing before

8-19     the hearings division of the department;

8-20                 (2)  notice of the deadline for requesting a hearing;

8-21     and

8-22                 (3)  a form requesting a hearing.

8-23           (b)  Notice under this section may be served as in civil

8-24     cases generally.

8-25           (c)  The notice must state that an order suspending a license

8-26     shall be rendered on the 60th day after the date of service of the

8-27     notice unless by that date:

 9-1                 (1)  the person pays the amount owed to the department;

 9-2                 (2)  the person presents evidence of a payment history

 9-3     satisfactory to the department in compliance with a reasonable

 9-4     repayment schedule; or

 9-5                 (3)  the person appears at a hearing before the

 9-6     hearings division and shows that the request for suspension should

 9-7     be denied or stayed.

 9-8           Sec. 23.007.  HEARING ON PETITION TO SUSPEND LICENSE.  (a)  A

 9-9     request for a hearing and motion to stay suspension must be filed

9-10     with the department not later than the 20th day after the date of

9-11     service of the notice under Section 23.006.

9-12           (b)  If a request for a hearing is filed, the hearings

9-13     division of the department shall:

9-14                 (1)  promptly schedule a hearing;

9-15                 (2)  notify the person and an appropriate

9-16     representative of the department of the date, time, and location of

9-17     the hearing; and

9-18                 (3)  stay suspension pending the hearing.

9-19           Sec. 23.008.  ORDER SUSPENDING LICENSE.  (a)  On making the

9-20     findings required by Section 23.003, the department shall render an

9-21     order suspending a license.

9-22           (b)  The department may stay an order suspending a license

9-23     conditioned on the person's compliance with a reasonable repayment

9-24     schedule that is incorporated in the order.  An order suspending a

9-25     license with a stay of the suspension  may not be served on the

9-26     licensing authority unless the stay is revoked as provided by this

9-27     chapter.

 10-1          (c)  A final order suspending a license rendered by the

 10-2    department shall be forwarded to the appropriate licensing

 10-3    authority.

 10-4          (d)  If the department renders an order suspending a license,

 10-5    the person may also be ordered not to engage in the licensed

 10-6    activity.

 10-7          (e)  If the department finds that the petition for suspension

 10-8    should be denied, the petition shall be dismissed without

 10-9    prejudice, and an order suspending a license may not be rendered.

10-10          Sec. 23.009.  DEFAULT ORDER.  The department shall consider

10-11    the allegations of the petition for suspension to be admitted and

10-12    shall render an order suspending a license if the person fails to:

10-13                (1)  respond to a notice issued under Section 23.006;

10-14                (2)  request a hearing; or

10-15                (3)  appear at a hearing.

10-16          Sec. 23.010.  REVIEW OF FINAL ADMINISTRATIVE ORDER.  An order

10-17    issued by the department under this chapter is a final agency

10-18    decision and is subject to review as provided by Chapter 2001,

10-19    Government Code.

10-20          Sec. 23.011.  ACTION BY LICENSING AUTHORITY.  (a)  On receipt

10-21    of a final order suspending a license, the licensing authority

10-22    shall immediately determine if the authority has issued a license

10-23    to the person named on the order and, if a license has been issued:

10-24                (1)  record the suspension of the license in the

10-25    licensing authority's records;

10-26                (2)  report the suspension as appropriate; and

10-27                (3)  demand surrender of the suspended license if

 11-1    required by law for other cases in which a license is suspended.

 11-2          (b)  A licensing authority shall implement the terms of a

 11-3    final order suspending a license without additional review or

 11-4    hearing.  The authority may provide notice as appropriate to the

 11-5    license holder or to others concerned with the license.

 11-6          (c)  A licensing authority may not modify, remand, reverse,

 11-7    vacate, or stay an order suspending a license issued under this

 11-8    chapter and may not review, vacate, or reconsider the terms of a

 11-9    final order suspending a license.

11-10          (d)  A person who is the subject of a final order suspending

11-11    a license is not entitled to a refund for any fee or deposit paid

11-12    to the licensing authority.

11-13          (e)  A person who continues to engage in the licensed

11-14    activity after the implementation of the order suspending a license

11-15    by the licensing authority is liable for the same civil and

11-16    criminal penalties provided for engaging in the licensed activity

11-17    without a license or while a license is suspended that apply to

11-18    any other license holder of that licensing authority.

11-19          (f)  A licensing authority is exempt from liability to a

11-20    license holder for any act authorized under this chapter performed

11-21    by the authority.

11-22          (g)  Except as provided by this chapter, an order suspending

11-23    a license or dismissing a petition for the suspension of a license

11-24    does not affect the power of a licensing authority to grant, deny,

11-25    suspend, revoke, terminate, or renew a license.

11-26          (h)  The denial or suspension of a driver's license under

11-27    this chapter is governed by this chapter and not by Subtitle B,

 12-1    Title 7, Transportation Code.

 12-2          Sec. 23.012.  MOTION TO REVOKE STAY.  (a)  The department may

 12-3    file a motion with the department's hearings division to revoke the

 12-4    stay of an order suspending a license if the person does not comply

 12-5    with the terms of a reasonable repayment plan entered into by the

 12-6    person.

 12-7          (b)  Notice to the person of a motion to revoke stay under

 12-8    this section may be given by personal service or by mail to the

 12-9    address provided by the person, if any, in the order suspending a

12-10    license.  The notice must include a notice of hearing before the

12-11    hearings division.  The notice must be provided to the person not

12-12    less than 10 days before the date of the hearing.

12-13          (c)  A motion to revoke stay must allege the manner in which

12-14    the person failed to comply with the repayment plan.

12-15          (d)  If the department finds that the person is not in

12-16    compliance with the terms of the repayment plan, the department

12-17    shall revoke the stay of the order suspending a license and render

12-18    a final order suspending a license.

12-19          Sec. 23.013.  VACATING OR STAYING ORDER SUSPENDING A LICENSE.

12-20    (a)  The department may render an order vacating or staying an

12-21    order suspending a license if the person has paid all amounts owed

12-22    to the department or has established a satisfactory payment record.

12-23          (b)  The department shall promptly deliver an order vacating

12-24    or staying an order suspending a license to the appropriate

12-25    licensing authority.

12-26          (c)  On receipt of an order vacating or staying an order

12-27    suspending a license, the licensing authority shall promptly

 13-1    reinstate and return the affected license to the person if the

 13-2    person is otherwise qualified for the license.

 13-3          (d)  An order rendered under this section does not affect the

 13-4    right of the department to any other remedy provided by law,

 13-5    including the right to seek relief under this chapter.  An order

 13-6    rendered under this section does not affect the power of a

 13-7    licensing authority to grant, deny, suspend, revoke, terminate, or

 13-8    renew a license as otherwise provided by law.

 13-9          Sec. 23.014.  FEE BY LICENSING AUTHORITY.  A licensing

13-10    authority may charge a fee to a person who is the subject of an

13-11    order suspending a license in an amount sufficient to recover the

13-12    administrative costs incurred by the authority under this chapter.

13-13          Sec. 23.015.  COOPERATION BETWEEN LICENSING AUTHORITIES AND

13-14    DEPARTMENT.  (a)  The department may request from each licensing

13-15    authority the name, address, social security number, license

13-16    renewal date, and other identifying information for each individual

13-17    who holds, applies for, or renews a license issued by the

13-18    authority.

13-19          (b)  A licensing authority shall provide the requested

13-20    information in the manner agreed to by the department and the

13-21    licensing authority.

13-22          (c)  The department may enter into a cooperative agreement

13-23    with a licensing authority to administer this chapter in a

13-24    cost-effective manner.

13-25          (d)  The department may adopt a reasonable implementation

13-26    schedule for the requirements of this section.

13-27          Sec. 23.016.  RULES, FORMS, AND PROCEDURES.  The department

 14-1    by rule shall prescribe forms and procedures for the implementation

 14-2    of this chapter.

 14-3          SECTION 7.  USE OF PRIVATE COLLECTION AGENTS.  (a)  With

 14-4    assistance from the Council on Competitive Government, the Texas

 14-5    Department of Human Services shall, in addition to other methods of

 14-6    collection, use private collection agents to collect reimbursements

 14-7    for benefits granted by the department in error under the food

 14-8    stamp program or the program of financial assistance under Chapter

 14-9    31, Human Resources Code.

14-10          (b)  The department shall ensure that the collection agents

14-11    are engaged in collection work on behalf of the department not

14-12    later than March 1, 1998.  The department shall strive to refer

14-13    approximately 20 percent of the department's claims for

14-14    reimbursement to the collection agents.

14-15          (c)  On March 1, 1998, and September 1, 1998, the department

14-16    shall submit a progress report to the governor, the Legislative

14-17    Budget Board, and the Health and Human Services Commission on the

14-18    department's efforts to use private collection agents to collect

14-19    reimbursements for erroneous benefits.  On March 1, 1999, the

14-20    department shall submit to the governor, the Legislative Budget

14-21    Board, and the Health and Human Services Commission a final report

14-22    on the success of the private collection effort.

14-23          (d)  Unless otherwise directed by the 76th Legislature, the

14-24    department shall evaluate the success of the use of private

14-25    collection agents to collect benefit reimbursements and adjust the

14-26    number of claims referred to the agents, as appropriate.

14-27          SECTION 8.  EXPEDITED FOOD STAMP DELIVERY; IMPACT ON

 15-1    FRAUDULENT CLAIMS.  (a)  The Texas Department of Human Services

 15-2    shall conduct a study to  determine the impact of the one-day

 15-3    screening and service delivery requirements prescribed by Section

 15-4    33.002(e), Human Resources Code, on the level of fraud in the food

 15-5    stamp program.

 15-6          (b)  Not later than January 1, 1998, the department shall

 15-7    submit to the governor, the Legislative Budget Board, and the

 15-8    Health and Human Services Commission a report on the results of the

 15-9    study.  The report must include:

15-10                (1)  detailed statistics by region on the number of

15-11    fraudulent claims linked to the one-day screening and service

15-12    delivery requirements; and

15-13                (2)  recommendations on modifying the one-day screening

15-14    and service delivery requirements, as authorized by Section

15-15    33.002(g), Human Resources Code.

15-16          SECTION 9.  STUDY ON COLLECTION OF ERRONEOUS BENEFITS THROUGH

15-17    LIENS OR WAGE GARNISHMENT.  (a)  The Texas Department of Human

15-18    Services shall conduct a study to determine the feasibility of

15-19    collecting amounts of benefits granted by the department in error

15-20    under the food stamp program or the program of financial assistance

15-21    under Chapter 31, Human Resources Code, by the garnishment of wages

15-22    or the filing of liens against property.

15-23          (b)  Not later than March 1, 1998, the department shall

15-24    submit to the governor, the Legislative Budget Board, and the

15-25    Health and Human Services Commission a report on the results of the

15-26    study.

15-27          SECTION 10.  TRANSITION RELATING TO DEDUCTIONS FROM LOTTERY

 16-1    PRIZES.  (a)  The Texas Department of Human Services shall take all

 16-2    action necessary  to implement the change in law made by Section 1

 16-3    of this Act not later than January 1, 1998.  The department may not

 16-4    seek recovery through lottery prize deduction of an amount of a

 16-5    benefit granted in error to a person under the food stamp program

 16-6    or the program of financial assistance under Chapter 31, Human

 16-7    Resources Code, before September 1, 1997.

 16-8          (b)  The executive director of the Texas Lottery Commission

 16-9    is not required under Section 466.407, Government Code, as amended

16-10    by this Act, to deduct from lottery prizes erroneous amounts

16-11    granted to lottery winners by the Texas Department of Human

16-12    Services until the department provides to the commission all

16-13    necessary information and reports required for implementation of

16-14    that section.

16-15          SECTION 11.  TRANSITION RELATING TO SUSPENSION OF LICENSES.

16-16    The Texas Department of Human Services shall take all action

16-17    necessary to  implement the change in law made by Section 6 of this

16-18    Act not later than January 1, 1998.  The department may not suspend

16-19    a license because of a person's failure to reimburse the department

16-20    for a benefit granted in error under the food stamp program or the

16-21    program of financial assistance under Chapter 31, Human Resources

16-22    Code, before September 1, 1997.

16-23          SECTION 12.  IMPLEMENTATION OF TELEPHONE COLLECTION PROGRAM.

16-24    The Texas Department of Human Services shall begin operation of the

16-25    telephone collection program required by Section 22.0252, Human

16-26    Resources Code, as added by this Act, not later than January 1,

16-27    1998.

 17-1          SECTION 13.  INITIAL REPORTING DATES.  (a)  Not later than

 17-2    September 1, 1997, the Texas Department of Human Services shall

 17-3    submit the initial report required by Section 22.027(e), Human

 17-4    Resources Code, as added by this Act.  

 17-5          (b)  Not later than January 1, 1998, the Texas Department of

 17-6    Human Services shall submit the initial reports required by

 17-7    Sections 22.0251(b) and 22.0291(e), Human Resources Code, as added

 17-8    by this Act.

 17-9          (c)  Not later than September 1, 1998, the Texas Department

17-10    of Human Services shall submit the initial report required by

17-11    Section 22.0252(b), Human Resources Code, as added by this Act.

17-12          SECTION 14.  EMERGENCY.  The importance of this legislation

17-13    and the crowded condition of the calendars in both houses create an

17-14    emergency and an imperative public necessity that the

17-15    constitutional rule requiring bills to be read on three several

17-16    days in each house be suspended, and this rule is hereby suspended,

17-17    and that this Act take effect and be in force from and after its

17-18    passage, and it is so enacted.