By:  Harris                                            S.B. No. 776
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the collection of accrued interest on child support
 1-3     arrearages; providing a penalty.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.  Section 157.262, Family Code, is amended to read
 1-6     as follows:
 1-7           Sec. 157.262.  REDUCTION OF ARREARAGES.  (a)  Except as
 1-8     provided by Subsection (b), in [In] a contempt proceeding or in
 1-9     rendering a money judgment, the court may not reduce or modify the
1-10     amount of child support arrearages.
1-11           (b)  On or after the first anniversary of the date the court
1-12     renders a money judgment, the court may reduce the interest accrued
1-13     on child support arrearages included in that judgment if the
1-14     obligor meets the requirements of Section 157.270.
1-15           (c)  The money judgment for arrearages rendered by the court
1-16     may be subject to a counterclaim or offset as provided by this
1-17     subchapter.
1-18           SECTION 2.  Subchapter F, Chapter 157, Family Code, is
1-19     amended by adding Sections 157.270 and 157.271 to read as follows:
1-20           Sec. 157.270.  REDUCTION OF ACCRUED INTEREST.  (a)  On or
1-21     after the first anniversary of the date a court renders a money
1-22     judgment under Section 157.263, the obligor against whom the
1-23     judgment was rendered may file a motion requesting that the court
1-24     reduce the amount of interest that was confirmed in the judgment
1-25     and owed on the child support arrearages.
 2-1           (b)  On finding that the obligor has substantially complied
 2-2     with the terms of an order requiring periodic payments toward the
 2-3     money judgment rendered under Section 157.263, the court may render
 2-4     an order reducing the interest to be paid by an amount that results
 2-5     in the repayment of an amount that will not create an undue
 2-6     hardship on the obligor or the obligor's family.
 2-7           (c)  The court shall state in the order reducing the amount
 2-8     of interest owed that the amount by which the interest is reduced
 2-9     may be included in a subsequent cumulative money judgment if the
2-10     obligor does not comply with an order to make periodic payments for
2-11     current support and child support arrearages.
2-12           Sec. 157.271.  PENALTY FOR NONPAYMENT.  (a)  On or after the
2-13     first anniversary of the date a court renders a money judgment
2-14     under Section 157.263, the obligee or the Title IV-D agency may
2-15     file a motion requesting that the court order the obligor to pay
2-16     additional interest on the money judgment as a penalty if the court
2-17     finds that the obligor did not substantially comply with the terms
2-18     of an order requiring periodic payments toward the money judgment.
2-19           (b)  Notwithstanding Section 157.265(b), the court, on making
2-20     the finding required by Subsection (a), may order that interest
2-21     accrues on the child support arrearages confirmed and reduced to a
2-22     money judgment at the rate of 13 percent simple interest per year
2-23     from the date the court rendered the money judgment under Section
2-24     157.263 until the date the judgment is paid.
2-25           SECTION 3.  This Act takes effect September 1, 2001.