90
th Legislative Session _ 2015
Committee: House Appropriations
Friday, February 20, 2015
P - Present
E - Excused
A - Absent
Roll Call
P Bordeaux
E Ring
P Hunhoff (Jean)
P Partridge
P Anderson
P Romkema
P Jensen (Alex)
P Dryden, Vice-Chair
P Cronin, Chair
OTHERS PRESENT: See Original Minutes
The meeting was called to order by Chair Cronin.
MOTION: TO APPROVE THE MINUTES OF FEBRUARY 12, 2015
Moved by: Dryden
Second by: Anderson
Action: Prevailed by voice vote.
HB 1190: make an appropriation for community-based provider workforce improvement and
to declare an emergency.
Presented by: Brenda Tidball-Zeltinger, Department of Social Services
Proponents: Mark Deak, South Dakota Health Care Association
Terry Dosch, SD Council of Mental Health Centers, Inc.
Terry Dosch, SD Council of Substance Abuse Directors, Inc.
Gilbert Johnson, South Dakota Association Of Healthcare Organization
Betty Oldenkamp, SD Association of Youth Care Providers
Karen Janousek, SD Nutrition Project Directors Association
Daryl Kilstrom, Community Support Providers Of South Dakota (Handouts: No. 1)
MOTION: AMEND HB 1190
1190na
On page 1, line 7, of the printed bill, delete "two million nine" and insert "one dollar ($1), and
the sum of one dollar ($1) in federal".
On page 1, delete lines 8 and 9.
On page 1, line 14, delete everything after "sum of" .
On page 1, delete line 15, and insert "one dollar ($1), and the sum of one dollar ($1)".
On page 2, line 1, delete everything before "in" .
On page 2, line 6, delete everything after "sum of" and insert "one dollar ($1), and the sum of
one dollar ($1)".
On page 2, delete line 7.
On page 2, line 8, delete everything before "in" .
Moved by: Dryden
Second by: Anderson
Action: Prevailed by voice vote.
MOTION: DO PASS HB 1190 AS AMENDED
Moved by: Dryden
Second by: Anderson
Action: Prevailed by roll call vote. (8-0-1-0)
Voting Yes: Bordeaux, Hunhoff (Jean), Partridge, Anderson, Romkema, Jensen (Alex), Dryden,
Cronin
Excused: Ring
HB 1228: establish the state debt collection office.
Presented by: Jason Dilges, Bureau of Finance & Management
Proponents: Greg Sattizahn, Unified Judicial System
Jack Warner, South Dakota Board of Regents
Curtis Everson, South Dakota Bankers Association
Matthew McCaulley, CGI Technologies and Solutions, Inc. (Handouts: No. 2)
Opponents: Mark Kisely, South Dakota Collectors Association
MOTION: AMEND HB 1228
1228oa
On the printed bill, delete everything after the enacting clause and insert:
" Section 1. There is hereby created the obligation recovery center. The obligation recovery center
is attached to the Bureau of Administration for budgeting and reporting purposes.
Section 2. Terms used in this Act mean:
(1) "Center," the obligation recovery center;
(2) "Debt," a legal obligation to pay money, including any principal, any interest that has
accrued or will accrue until the debt is paid, any penalties, any costs, and any other
charges permitted by law. The term debt includes any obligation of any kind referred to
the obligation recovery center for collection by any state government agency, by the
Unified Judicial System, by the Board of Regents, or by a constitutional office;
(3) "Debtor," a person who is indebted to the state or a state agency for any delinquent
accounts, charges, fees, loans, taxes, or other indebtedness due the state, or any person
that owes any obligation being collected by the obligation recovery center;
(4) "Final debt," any debt due a state executive branch agency, the Board of Regent's system,
or a constitutional office that is no longer subject to an administrative appeal or judicial
review following an administrative appeal, or any costs, fines, fees or restitution ordered
in any adult criminal proceeding through the Unified Judicial System no longer subject
to direct appeal pursuant to § 23A-32-2;
(5) "Final notification," the notification provided by section 7 of this Act; and
(6) "Referring entity," the entity referring the debt to the state obligation recovery center for
collection.
Section 3. The center shall work to collect each final debt referred to the center. The character
of the debt in the hands of the referring entity does not change by the referral of the debt to the center
for collection. Among other powers granted by this Act, the center may:
(1) Sue;
(2) File liens;
(3) Enter into payment agreements with debtors;
(4) Impose a cost recovery fee;
(5) Collect data for debt collection purposes;
(6) Establish and maintain a centralized electronic debt management system;
(7) Exercise settlement authority granted by the referring entity;
(8) Setoff against any moneys to be paid by the State of South Dakota or any referring entity
to a debtor;
(9) Contract with multiple collection agencies for the collection of debt on behalf of the
center;
(10) Except for the debt collection powers vested in the Unified Judicial System, the center
may use the referring entity's statutory collection authority to collect the final debt owed
to the referring entity; and
(11) Utilize all debt collection methods authorized by state law.
The office may determine which method or combination is most suitable to collect the debt.
Section 4. For any final debt referred to the center for collection after July 1, 2015, the center
shall collect a cost recovery fee in addition to the debt referred to the center for collection. The cost
recovery fee is calculated by multiplying the principal amount of the debt referred to the center by
twenty percent. All debt collection methods available to collect any final debt referred to the center
may be used by the center to collect the cost recovery fee. The cost recovery fee shall be deposited
into a fund to be used to fund the operations of the center.
Section 5. The center shall retain the cost recovery fee and transfer any other moneys collected
from a debtor to the referring entity within thirty days after the end of the month in which the moneys
were collected. If the amount collected is less than the principal amount of the debt referred to the
center and the cost recovery fee imposed by this Act, the amount collected shall be prorated between
the principal amount of the debt referred and the cost recovery fee.
If more than one referring entity has referred a debt to the center regarding the same debtor, or
if the same referring entity has referred multiple debts to the office regarding the same debtor, the
center shall collect the first referred debt before proceeding to the collection of the subsequent
referred debt in the order referred.
Section 6. The center may be used as follows:
(1) Any executive branch agency may use the center to collect final debt owed to an executive
branch agency;
(2) The Unified Judicial System may use the center to collect any costs, fines, fees, or
restitution, constituting final debt, ordered in any adult criminal proceeding;
(3) The Board of Regents may use the center to collect any final debt owed within the South
Dakota Board of Regents' system; and
(4) Any constitutional office may use the center to collect final debt owed to the
constitutional office.
Section 7. Prior to transferring any debt to the center for collection, the referring entity shall
provide a final notification to the debtor that the debt will be referred to the center for collection.
The final notification to the debtor may be sent by regular mail or by electronic means. The final
notification shall contain all of the following:
(1) The name of the referring entity;
(2) Contact information for the referring entity;
(3) The name of the debtor;
(4) The nature of the debt;
(5) The principal amount of the debt;
(6) The total amount of the debt;
(7) A statement that the debt will not be turned over for collection to the center until a time
at least fourteen days after the date the final notification is sent to the debtor; and
(8) A statement that if the debt is turned over to the center, a cost recovery fee of twenty
percent of the principal, in the amount of $ ______, will be added to the total debt owed
by the debtor to the referring entity.
Section 8. All data, records, and files utilized for debt collection as provided for in this Act shall
be confidential and privileged, and no person may divulge or disclose any information obtained from
such records and files except in the administration and enforcement of this Act, or as otherwise
required by law.
Section 9. The center may collect data for purposes of collecting any debt referred to the center.
Notwithstanding any law to the contrary, referring entities are authorized to transmit data to the
center deemed necessary by the center to aid in the collection of the referred debt and the center may
share, request, and shall receive from any state agency any data to collect any debt referred to the
center. Any information provided by a referring entity or a state agency may only be used for the
purpose of collecting the debts referred to the center.
Section 10. The center shall establish and maintain a centralized electronic debt management
system to compile the information provided by referring entities, to track the collection efforts for
all debt referred to the center, to cross-reference and identify debtors for collection purposes, and to
maintain all information provided or collected from all sources concerning addresses, financial
records, and any other information useful to the center.
The center may designate a third party to establish and maintain the centralized electronic debt
management system. Any such third party shall keep all information it obtains from any source
confidential, and any employee, agent, or representative of that third party is prohibited from
disclosing that information to anyone other than the center.
Section 11. No person that owes a debt that is referred to the center may renew, obtain or
maintain:
(1) Any registration for any motor vehicle, motorcycle, or boat, in which the person's name
appears on the title of the motor vehicle, motorcycle, or boat;
(2) Any driver license as defined by subdivision (1) of § 32-12-1; or
(3) Any hunting license, fishing license, state park permit or camping permit;
unless the debt and cost recovery fee is either paid in full or the debtor has entered into a payment
plan with the center and payment pursuant to the plan is current.
Section 12. No agency, board, or entity of the State of South Dakota may issue, renew, or allow
an individual to maintain any motor vehicle, motorcycle, or boat registration, driver license, hunting
license, fishing license, state park permit, or camping permit, after receiving notice from the center
that the applicant, registrant, or licensee has a debt that is being collected by the center, unless the
applicant, registrant, or licensee has paid the debt and cost recovery fee in full or the debtor has
entered into a payment plan with the center and payment pursuant to the plan is current.
An applicant, registrant, or licensee who disputes a determination by the center that the applicant,
registrant, or licensee has a debt that has been referred to the center for collection shall, upon request,
be given a due process hearing by the center. Upon recommendation by the center, the agency or
entity may issue a temporary license, registration, certification, or permit to the applicant, registrant,
or licensee pending final resolution of the due process hearing.
Section 13. Unless preempted by other law, any payment of any kind to be made to a debtor by
the State of South Dakota or any referring entity, when the debtor has a debt that is referred to the
center, is subject to offset by the center unless the debt and cost recovery fee is either paid in full or
the debtor has entered into a payment plan with the center and payment pursuant to the plan is
current.
Section 14. If the center is unable to collect the debt referred to it, the center, with the approval
of the referring entity, may forward the debt to a collection agency or agencies for collection. The
debt collection agency shall be permitted to add a collection charge, not to exceed twenty percent
of the debt, to the debt forwarded to the collection agency as payment for its collection services. The
center shall promulgate rules pursuant to chapter 1-26 concerning the process of contracting with and
referring debt to debt collection agencies.
Section 15. The center may promulgate rules, pursuant to chapter 1-26, in the following areas:
(1) Definitions;
(2) Procedure for remitting moneys collected to referring entities;
(3) Processes and procedures for entering into payment agreements with debtors;
(4) The cost recovery fee;
(5) The data collection system;
(6) The centralized electronic debt management system;
(7) The settlement authority process;
(8) The procedure for sending information to the Division of Motor Vehicles concerning the
nonrenewal of registrations for motor vehicles, motorcycles, and boats;
(9) The procedure for sending information to the Department of Public Safety concerning the
nonrenewal of driver licenses;
(10) The procedure for sending information to the Department of Game, Fish and Parks
concerning the nonissuance of hunting licenses, fishing licenses, state park permits and
camping permits; and
(11) The setoff of debt process.
Section 16. The center shall annually report to the Legislature concerning the activity of the
center including the number of debts referred to the entity, the annual amount and nature of the debt
obligations recovered by the center, the number of debts referred from the center to private collection
agencies and the results of those referrals, and the costs and expenditures incurred by the center."
Moved by: Dryden
Second by: Partridge
Action: Prevailed by voice vote.
MOTION: AMEND TITLE OF HB 1228
1228ota
On page 1, line 1, of the printed bill, delete everything after "Act to" and insert "establish an
obligation recovery center.".
Moved by: Dryden
Second by: Partridge
Action: Prevailed by voice vote.
THE CHAIR DEFERRED HB 1228 UNTIL FEBRUARY 24, 2015
SB 47: make an appropriation from the coordinated natural resources conservation fund to
the State Conservation Commission and to declare an emergency.
Presented by: Bill Smith, Dept. Of Agriculture (Handouts: No. 3, No. 4, No. 5)
Proponents: Angela Ehlers, SD Assoc. Of Conservation Districts
MOTION: DO PASS SB 47
Moved by: Dryden
Second by: Anderson
Action: Prevailed by roll call vote. (8-0-1-0)
Voting Yes: Bordeaux, Hunhoff (Jean), Partridge, Anderson, Romkema, Jensen (Alex), Dryden,
Cronin
Excused: Ring
HB 1110: approve the addition of judges to the Second and Seventh Judicial Circuits and to
make an appropriation therefor.
Presented by: Representative Brian Gosch (Handouts: No. 6, No.7, No. 8)
Proponents: Circuit Judge Larry Long
Circuit Judge Jeff Davis
David Gilbertson, Chief Justice of the Supreme Court
Tom Barnett, State Bar of South Dakota
Bob Wilcox, South Dakota Association of County Commissioners
Opponents: Steven Kohler, Bureau of Finance & Management
MOTION: AMEND HB 1110
1110na
On page 1, line 4, of the printed bill, delete "two hundred" and insert "one dollar ($1),".
On page 1, line 5, delete everything before "or" .
On page 1, line 7, delete everything after "of" and insert "one dollar ($1)".
On page 1, line 8, delete everything before "appropriated" .
On page 1, line 9, delete "thirteen thousand six hundred forty-five dollars ($13,645)" and insert
"one dollar ($1)".
On page 1, line 13, delete "two hundred" and insert "one dollar ($1),".
On page 1, line 14, delete everything before "or" .
On page 2, line 1, delete everything after "of" and insert "one dollar ($1)".
On page 2, line 2, delete everything before "appropriated" .
On page 2, line 3, delete "thirteen thousand six hundred forty-five dollars ($13,645)" and insert
"one dollar ($1)".
Moved by: Dryden
Second by: Jensen (Alex)
Action: Prevailed by voice vote.
MOTION: DO PASS HB 1110 AS AMENDED
Moved by: Dryden
Second by: Anderson
Action: Prevailed by roll call vote. (8-0-1-0)
Voting Yes: Bordeaux, Hunhoff (Jean), Partridge, Anderson, Romkema, Jensen (Alex), Dryden,
Cronin
Excused: Ring
MOTION: ADJOURN
Moved by: Jensen (Alex)
Second by: Partridge
Action: Prevailed by voice vote.
Mary Turner
____________________________
Committee Secretary
Justin R. Cronin, Chair
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