Commissioner Nichols said: “This is an important step for taking a data-driven approach toward implementing a comprehensive plan that protects taxpayers and aggressively and persistently pursues money owed to the state.”
The purpose of the RFP was to engage expert analysis of the state’s inventory of accounts receivables and debt owed to it. This data gathering will be utilized by the Commissioner of Administration in implementing a strategy and developing tools which can enhance the state’s ability to capture money owed to the state.
An amendment to the RFP was also issued to make clear that, once the contract is finalized, there would be a more aggressive timeframe for pursuing the sale of long-term debts.
At a meeting of the Cash Management Review Board in September, the administration presented a strategy to improve state debt collection that is focused on improving state debt functions, strategically recognizing where third party entities should support state work, and more aggressively pursuing delinquent debts. That strategy includes:
- 1.Consolidate, centralize, coordinate: Improving and supporting state debt function.
- a.Streamline agency collection efforts for recently delinquent debts. Instead of having agency accountants operating by different rules, we will standardize the policies and procedures by which they pursue recently outstanding accounts receivable.
- b.Consolidate state level efforts and utilize third-party support. Once debts have reached adolescence, evaluate debts to be either tasked to a group of fulltime collection agents in a consolidated state entity, outsourced to third-party debt collection experts or addressed via public-private debt collection partnership.
- 2.Trigger early action for delinquent payments. We will institute a standardized timeline for when outstanding accounts receivable follow different recoupment procedures. These deadlines will send a debt from agency accountants to state collection agents or third-party collection entities so that no debt falls through the cracks. For debts that may be the cause of disputed invoices, we will expedite the hearing and arbitration process and the negotiation of settlements.
- 3.Strengthen enforcement. In order to ensure maximum payment, we will establish and/or enhance penalties, fees, and fines, including offsets such as withholding tax refunds or unclaimed property, and a freeze on any further state work or payments for any entity with outstanding state debt. We will improve the management and coordination of state tracking and management of accounts receivables to reflect the status of each, such as amount owed, debtor, and agency. We will also increase the use of electronic payment methods to make it easier for people to pay in the first place.
In an effort to take immediate actions toward implementation of these strategies, the Division of Administration worked closely with the Department of Revenue on the development of a new offset program, which was announced in October.
(Jindal Administration Press Release)
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