Code of Massachusetts Regulations
815 CMR - COMPTROLLER'S DIVISION
Title 815 CMR 9.00 - Debt Collection And Intercept
Section 9.02 - Definitions

Current through Register 1531, September 27, 2024

Accounts Receivable. Public Revenues earned but not yet collected for legislatively or legally authorized Charges for services performed, goods provided, or events, such as judgments and recoveries, fines, fees for licenses and permits, charges for services, investment income, operating leases or any other obligations owed to and being pursued for Collection by a Billing Entity. Accounts Receivable includes, but is not limited to loans, notes and amounts due from employees, other State Departments, cities, towns and political subdivisions of the State, Debts of the Federal government, and Debts of another state. An Accounts Receivable that is unpaid by the due date of its initial billing shall be considered a "Debt". The Collection of certain Revenues with separate Debt Collection authority, including taxes, lottery operations, State investments, federal grants and reimbursements, Medicaid vendor overpayments are not included under 815 CMR 9.00 unless the Billing Entity chooses to use the Statewide Debt Collection Agency Contract or Intercept to collect these Debts.

Accounts Receivable System. A billing and Accounts Receivable System or application used to issue invoices and collect Accounts Receivables on behalf of a Billing Entity. State Department Billing Entities must use the State Accounting System, known as the Massachusetts Management and Reporting System (MMARS) or an alternative billing and Accounts Receivables System or application approved by the Comptroller.

Attorney General (AGO). The Office of the Attorney General of the State, established by M.G.L. c. 12, § 1.

Billing Entity. An entity authorized to collect Debts including State departments, subdivisions, offices, boards, commissions, committees, councils, boards, institutions of Higher Education, the Judicial and Legislative Branches and Constitutional Offices and other public entities as authorized by law including municipalities, a city or town, an agency of a city or town of the State, a housing authority of the State, or a State authority as defined by M.G.L. c. 29, a Federal Billing Entity or Non-Massachusetts state Billing Entity. The Comptroller will prescribe the methods for State Department Billing Entities to bill and collect Debts under 815 CMR 9.00 and the requirements for any Billing Entity to use the Intercept process. The Comptroller may enter into Reciprocal Cooperative Agreements with the federal government and other states to collect and receive Debts and to remit Intercepted State payments to offset the federal government and other state's Debts. Billing Entities shall be responsible for validating that a Debt and Debtor information are accurate prior to submission of any Debt for Intercept under 815 CMR 9.00.

Certify. A certification by an authorized signatory of the Billing Entity that the name of the Debtor, the tax identification number, address, the amount of the Debt and the existence of a Debt have been validated as accurate, that the debt has been diligently pursued, that notices of intercept have been provided and that the Debt is eligible for Intercept under 815 CMR 9.00. The Comptroller shall designate the mechanism for how a Billing Entity will certify that a Debt and Debtor information is accurate and legally enforceable in order to be collected through Intercept.

Collection. An action taken by a Billing Entity to collect a legislatively or legally authorized account receivable. Collection actions include, but are not limited to, billing and Dunning Notices, Intercept, Collection by a Statewide Debt Collection Agency, and litigation.

Contingent Percentage Fee. A payment under which a Statewide Debt Collection Agency is paid a percentage fee "contingent" on the amount of delinquent Accounts Receivable collected by a Statewide Debt Collection Agency.

Debt. An outstanding Accounts Receivable, obligation or other liability to pay or return something to a Billing Entity.

Debt Collection Agency. A duly licensed entity which has been authorized under the Statewide Contract for Debt Collection Services to assist Billing Entities in Collection of Debts. Debt Collection Agencies approved under the Statewide Contract for Debt Collection Services must be licensed to perform Debt Collection services in the State by the Division of Banks.

Debtor. An individual, sole proprietor, corporation, partnership, organization, business trust or association or two or more persons, or other legal entity which owes an Accounts Receivable, obligation or other liability to pay or return something to the State, federal, local or the Billing Entity in another state.

Department. State agencies, departments, subdivisions, offices, boards, commissions, committees, councils, boards or institutions of the State, the Institutions of Higher Education, the Judicial and Legislative Branches and Constitutional Offices as defined in M.G.L. c. 29.

Discharge. The dissolution of a Debt, either through full payment, Intercept, Settlement with partial Write-off or Write-off.

Disputed Debt. Occurs when a Debtor notifies a Billing Entity, or Debt Collection Agency, that there is a disagreement as to the identity of the Debtor, the amount or the existence of a Debt.

Division of Banks. State Department created under M.G.L. c. 26, 209 CMR 18.00: Conduct of the Business of Debt Collectors and Loan Servicers and M.G.L. c. 93, § 24A that licenses Debt Collection Agencies in the State. Debt Collection Agencies under the Statewide Debt Collection Contract must be certified by the Division of Banks to perform Debt Collection services in the State.

Due Date. The date when payment of an account receivable is due, usually 30 calendar days from the date an Accounts Receivable event occurs or its billing date; or as established by contractual terms or statute.

Dunning Notice. A written notice appearing on an invoice or statement mailed or personally delivered to a Debtor providing notice that payment for an Accounts Receivable or a Debt is past due, the right to dispute the Debt and an opportunity for due process or a Hearing. The requirements for Dunning Notices for Debts to be collected on behalf of State Department Billing Entities or through the Intercept process are identified under 815 CMR 9.03.

Hearing. A Debtor's opportunity to present evidence or other proof to dispute the validity of a Debt, the amount of a Debt or the identity of the Debtor. A Hearing may be in any format that provides a Debtor with a reasonable opportunity to provide proof to dispute any aspect of a Debt or the identity of the Debtor and to resolve the Disputed Debt. A Hearing may be in the form of a M.G.L. c. 30A Hearing or any other meeting or reasonable opportunity to collect and record evidence provided by a Debtor, hear any arguments and attempt to resolve the Disputed Debt. Any administrative or other court process pursued in the normal course of business of a Billing Entity that provides the same opportunity to dispute the Debt and results in an order or other directive to make payment shall meet the Hearing requirement.

Intercept. An action performed under 815 CMR 9.00 by the Office of the Comptroller through the MMARS State Accounting System to discharge a delinquent Debt from other funds owed or scheduled to be paid to a Debtor, including tax refunds pursuant to M.G.L. c. 62D, Settlements and judgments, and other funds as determined by the Comptroller to be authorized to be used for Intercept Collections. Intercept Collection Charges are automatically deducted from at the time of Intercept.

Judgment. A court order ruling that the Debtor is obligated to pay a Billing Entity a specific sum. Court judgments or other administrative procedures providing a Debtor with sufficient due process and opportunity to dispute a Debt will waive the requirement for multiple billings and notices of Debt Collection and Intercept. A Billing Entity may submit directly to a Statewide Debt Collection Agency or Intercept or any other administrative or legal procedure to collect a Debt under judgment.

Late Fees and Collection Charges. Contingent Percentage Fees and other fees and charges established under M.G.L. c. 29, § 29H or other state or federal laws or regulations, which are added to the Debt to be collected and deducted from payments when a Debt is collected.

Revenue. All amounts due and collected from taxes, agency fees, fines, assessments, Charges, and other Revenues, retained Revenues, federal grants, federal reimbursements, lottery receipts, court judgments and investment earnings and other Revenues for a State, federal or local Billing Entity.

Settlement. A legally enforceable agreement between a Billing Entity and a Debtor to accept a lesser Debt amount than owed to discharge the Debt in full. For State Department Billing Entities, a Settlement requires a partial Write-off of the Debt and the Billing Entity must have made diligent efforts to collect the full amount of the Debt through Intercept, a Debt Collection Agency, litigation or other administrative process prior to submitting a request to the Office of the Comptroller for partial Write-off of the Debt through Settlement.

State. The Commonwealth of Massachusetts.

State Accounting System. The official accounting system used by the State to record and report on the State's accounting and financial activity known as the Massachusetts Management and Reporting System (MMARS).

Statewide Contract for Debt Collection Services. A contract procured by the Office of the Comptroller for the provision of Debt Collection services on behalf of all Departments and other authorized Billing Entities. Statewide Collection Agencies agree to provide Debt Collection services in return for a specified Contingent Percentage Fee based upon the amount of delinquent Accounts Receivable collected by the Collection Agency.

Uncollected Receivable. A Debt which, after diligent but unsuccessful attempts at Collection is deemed uncollectible. State Department Billing Entities are required to pursue Debts through both Intercept and Debt Collection services prior to identifying a Debt uncollectible and eligible for Write-off. For the purposes of Debt Collection services, Debts will be administratively deemed "uncollectible" six months after referral to a Debt Collection Agency and must be returned to the Billing Entity for re-referral, continued Intercept, or Write-off.

Write-off. An accounting action to remove an uncollected receivable from the Billing Entity's financial records. For State Debts, the Billing Entity must demonstrate diligent efforts to collect the Debt including Debt Collection and Intercept, prior to submission of a request for Write-off to the Office of the Comptroller.