79(R) HB 3120 - Introduced version


                                                                                

79R9965 CLG-D

By:  Giddings                                                     H.B. No. 3120



A BILL TO BE ENTITLED

AN ACT

relating to the regulation of private child support enforcement 
agencies and collection of child support obligations; providing a 
criminal penalty.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 396.001, Finance Code, is amended by 
amending Subdivision (1) and adding Subdivision (1-a) to read as 
follows:
		(1)  "Certified foreign agency" means a foreign agency 
that, in lieu of registration, is issued a certificate to operate in 
this state under Subchapter D.
		(1-a)  "Child support enforcement" means an action, 
conduct, or practice in enforcing, or in soliciting for 
enforcement, a child support obligation, including the collection 
of an amount owed under a child support obligation.
	SECTION 2.  Section 396.153, Finance Code, is amended to 
read as follows:    
	Sec. 396.153.  NOTIFICATION OF UPDATED INFORMATION OR CHANGE 
IN STATUS OF OTHER AUTHORIZATION.  Not later than the 30th day after 
the date on which the change occurs, a certified foreign [private 
child support enforcement] agency [that is issued a certificate to 
operate in this state under this subchapter] shall notify the 
department of any change in:
		(1)  the information provided in an application 
submitted under Section 396.152; or
		(2)  the status of the agency's authorization in the 
other state.           
	SECTION 3.  Section 396.203, Finance Code, is amended by 
amending Subsection (a) and adding Subsections (c), (c-1), and 
(c-2) to read as follows:
	(a)  A registered agency and certified foreign agency 
[authorized to engage in business under this chapter] shall execute 
a written contract for the enforcement of child support for each 
client of the agency that is residing in this state.
	(c)  The contract required under this section must contain a 
provision that allows the client the option to cancel the contract 
by:
		(1)  notifying the agency of the client's intent to 
cancel not later than the 30th day after the date the contract is 
executed; or
		(2)  paying an amount not to exceed $500 any time after 
the 30th day after the date the contract is executed and before the 
end of the contract period.
	(c-1)  The exact amount of the cancellation fee under 
Subsection (c)(2) and the applicable deadlines under Subsection (c) 
must be specifically stated in the contract.
	(c-2)  An attempted waiver of the cancellation provision 
required by this section is void.
	SECTION 4.  Subchapter E, Chapter 396, Finance Code, is 
amended by adding Section 396.204 to read as follows:
	Sec. 396.204.  ANNUAL REPORT.  Not later than September 1 of 
each year, each registered agency shall provide to the department a 
detailed report accounting for all child support collections made 
by the agency during the preceding calendar year.  The report, at a 
minimum, must contain a statement of the amount of child support 
collected on behalf of, and disbursed to, each client, including:
		(1)  the date on which the amount of child support was 
collected; and
		(2)  the date on which each amount of child support due 
the client by the obligor was paid to the client.
	SECTION 5.  Subchapter F, Chapter 396, Finance Code, is 
amended by adding Sections 396.253 and 396.254 to read as follows:
	Sec. 396.253.  FEE OR OTHER CONSIDERATION RECEIVED BY 
AGENCY.  (a)  For child support enforcement, a registered agency or 
certified foreign agency may not receive a fee or other 
consideration that exceeds 20 percent of the total amount of the 
child support obligation collected by the agency from the obligor.
	(b)  A registered agency or certified foreign agency may not 
receive a fee or other consideration for any child support payment 
that:
		(1)  is collected through the efforts of a state or 
local governmental entity or agency; or
		(2)  is collected by another registered agency or 
certified foreign agency.
	(c)  A person who violates this section commits an offense.  
An offense under this section is a Class B misdemeanor.
	Sec. 396.254.  REDIRECTION OF CHILD SUPPORT PAYMENTS 
PROHIBITED.  (a)  In this section:
		(1)  "Local registry" has the meaning assigned by 
Section 101.018, Family Code.
		(2)  "State disbursement unit" has the meaning assigned 
by Section 101.0302, Family Code.
		(3)  "Title IV-D agency" has the meaning assigned by 
Section 101.033, Family Code.
	(b)  No child support payment or arrearage may be redirected 
by the Title IV-D agency, the state disbursement unit, or a local 
registry to a private child support enforcement agency.
	SECTION 6.  Subchapter H, Chapter 396, Finance Code, is 
amended by adding Section 396.354 to read as follows:
	Sec. 396.354.  VOIDABLE CONTRACT.  (a)  A contract that does 
not contain the provision required by Section 396.203(c) is 
voidable at the option of the client.  The client is entitled to 
recover any amount the registered agency or certified foreign 
agency received as compensation in connection with the contract.
	(b)  A person who prevails in an action to enforce the 
person's rights under this section is entitled to recover court 
costs and reasonable attorney's fees.
	SECTION 7.  Sections 396.203(c), 396.253, and 396.354, 
Finance Code, as added by this Act, apply only to a contract that is 
entered into on or after the effective date of this Act.
	SECTION 8.  This Act takes effect September 1, 2005.