KRS § 45.238 — KY Code / Title VI / Chapter 45 / Section 45.238
45.238 Powers and duties of Department of Revenue to collect referred debts -- Cost-ineffective debts -- Treatment of collected debts -- Annual report
Status: in_force

45.238 Powers and duties of Department of Revenue to collect referred debts --

Cost-ineffective debts -- Treatment of collected debts -- Annual report.

(1) Debts that are certified by an agency or by a local government as provided in KRS

45.237 shall be referred to the department for collection. The department shall be

vested with all the powers necessary to collect any referred debts.

(2) (a) For those debts deemed unfeasible or cost ineffective to pursue, the

department shall maintain written records of the debt and the reason the debt

was deemed unfeasible or cost ineffective to pursue.

(b) In the case of agencies, these debts shall be written off in accordance with

administrative regulations promulgated under the authority of subsection (6)

of this section.

(c) In the case of local governments, these debts shall be returned to the referring

local government for further action.

(3) (a) All certified debts of agencies received by the department after the sixty (60)

day collection period allowed in KRS 45.237(4), and all certified debts of a

local government received by the department after the ninety (90) day

collection period allowed by KRS 45.237(5), shall be subject to:

1. Interest at the tax interest rate determined under KRS 131.183 on the

amount of the debt plus all accruals authorized by law, from the date the

debt is certified to the department until it is satisfied; and

2. A one (1) time twenty-five percent (25%) collection fee imposed on the

amount of the debt plus all accruals authorized by law, as of the time of

referral.

(b) The department may retain the collection fee.

(c) In the case of agencies and the Court of Justice, recovered funds and interest

may, at the discretion of the secretary of the Finance and Administration

Cabinet, be returned to the agency certifying the debt or improper payment or

to the Court of Justice for allocation as otherwise provided by law. If the

recovered funds and interest are not returned to the agency or Court of Justice,

the amounts shall be deposited in the budget reserve trust fund established in

KRS 48.705, except for Medicaid benefits and funds required by law to be

remitted to a federal agency.

(d) In the case of local governments, recovered funds and interest shall be

returned to the referring local government for allocation as provided by

ordinance, resolution, or as otherwise provided by law.

(4) The commissioner of the department may refer to the Attorney General any

unsatisfied claim, demand, account, or judgment in favor of the Commonwealth for

further civil or criminal action under KRS 15.060.

(5) (a) The department shall report annually by October 1 to the Legislative Research

Commission on all referred certified debts, including at least a summary of the

debts by agency, fund type, and age, the latter compiled in the following four

(4) categories:

1. Debts from ninety (90) to one hundred seventy-nine (179) days old;

2. Debts from one hundred eighty (180) to three hundred sixty-four (364)

days old;

3. Debts over one (1) year old but less than three (3) years old; and

4. Debts three (3) years old or older.

(b) The annual report shall also include the collection amount of the debts in

paragraph (a) of this subsection and the accounts to which the amounts are

credited.

(6) The department shall promulgate administrative regulations in accordance with

KRS Chapter 13A to establish standards that agencies shall use in determining

when to write debts off the books.

(7) This section shall not affect the collection of delinquent taxes by sheriffs or county

attorneys under KRS 91A.070 or 134.504.