HBA-NLM H.B. 3127 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 3127 By: Chisum Economic Development 4/11/1999 Introduced BACKGROUND AND PURPOSE Currently, the Texas Workforce Commission (commission) attempts to collect unemployment benefits which are paid in error. The commission ceases any further attempts to collect these amounts after the case goes through the commission's normal collection process. The commission reported $245 million of overpaid unemployment benefits, as of August 31, 1998. H.B. 3127 provides that a claimant who receives an overpayment of benefits, regardless of the reason for the overpayment, is not entitled to retain the amount overpaid, except as provided by Section 210.003 (Employee's Liability; Sole Liability of Employer). This bill creates Subchapter H (Collection of Overpaid Benefits), Chapter 207, Labor Code, authorizing the commission, if the commission determines that a claimant who has received an overpayment of benefits is unable or unwilling to refund to the compensation fund the amount of the overpayment, to deduct the amount overpaid to the claimant against that claimant's future benefits under this subtitle or submit the overpayment for collection. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the Texas Workforce Commission in SECTION 1 (Section 207.131, Labor Code) of this bill. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 207.001, Labor Code, to provide that a claimant is not entitled to retain any unemployment compensation benefits paid to that claimant that exceed the amount of benefits authorized by this subtitle, except as provided by Section 210.003 (Employee's Liability; Sole Liability of Employer). SECTION 2. Amends Chapter 207, Labor Code, by adding Subchapter H, as follows: SUBCHAPTER H. COLLECTION OF OVERPAID BENEFITS Sec. 207.131. NO ENTITLEMENT TO OVERPAID BENEFITS. (a) Provides that a claimant who receives an overpayment of benefits, regardless of the reason for the overpayment, is not entitled to retain the amount overpaid, except as provided by Section 210.003. (b) Requires the claimant to refund the amount overpaid to the compensation fund in the manner prescribed by rules adopted by the commission. Authorizes the Texas Workforce Commission (commission), by rule, to allow a repayment made under this subsection to be made in periodic payments. (c) Authorizes the commission, if the commission determines that a claimant who has received an overpayment of benefits is unable or unwilling to refund to the compensation fund the amount of the overpayment, to deduct the amount overpaid to the claimant against that claimant's future benefits under this subtitle or submit the overpayment for collection in the manner provided by Section 207.132. Sec. 207.132. COLLECTION OF OVERPAID BENEFITS. (a) Requires the commission to collect overpaid benefits and authorizes the commission to contract with private vendors for the collection of those benefits as provided by this section. Requires the commission to design and control any collections process adopted under this section. (b) Requires the commission to issue a request for proposals for a contract for collection of overpayments determined to be uncollectible through the procedures authorized under Section 207.131 or 212.006 (Recovery of Benefits Paid). (c) Authorizes the division of the commission that is responsible for collection of overpaid benefits to submit a bid for the contract, as well as any private vendor determined to be qualified by the commission. Requires the commission to require a person who enters into the contract to submit bills to the commission for payment. Prohibits a contractor under this section from being paid through retention of a percentage of the amount collected. (d) Provides that a contract entered into by the commission under this section must conform to any applicable federal regulations as necessary to enable the commission to be eligible to obtain federal funding for payment of the contract. Sec. 207.133. DISPUTE RESOLUTION. Provides that a claimant who disputes the designation of any benefits received by that claimant as overpaid benefits is entitled to a hearing in the manner provided by Chapter 212 (Dispute Resolution) for a disputed claim. SECTION 3. Amend the heading to Section 211.004, Labor Code, as follows: Sec. 211.004. New title: OFFSET UNDER CERTAIN RECIPROCAL ARRANGEMENTS FOR OVERPAYMENT OF UNEMPLOYMENT BENEFITS. SECTION 4. Amends Section 212.006, Labor Code, to provide that benefits paid to a claimant that are not in accordance with the final decision are subject to Subchapter H, Chapter 207. Provides that if overpaid benefits are not collected by a private vendor as provided by Section 207.132, benefits paid are also collectible by the commission. Deletes existing text relating to required refunds to the commission and deductions from future benefits. Makes a nonsubstantive change. SECTION 5. Effective date: September 1, 1999. Makes application of this Act prospective. SECTION 6. Emergency clause.