(a) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise.
  (1) Debtor--Any person or entity liable or potentially liable for a charitable bingo related obligation owed to the Commission or against whom a claim or demand for payment has been made.
  (2) Delinquent--Payment is past due by law or by customary business practice, and all conditions precedent to payment have occurred or been performed.
  (3) Demand letter--A writing mailed to a debtor setting forth the nature and amount of the obligation owed to the Commission and demanding payment of that obligation.
  (4) Obligation--Any debt, judgment, claim, account, fee, fine, tax, penalty, or interest.
  (5) OAG--Office of the Attorney General of Texas.
(b) Upon a determination by the Charitable Bingo Operations Director, or their designee, that a charitable bingo related obligation to the Commission is delinquent, the Charitable Bingo Operations Director or designee will:
  (1) Attempt to determine the liability of each individual or entity responsible for the obligation and whether that liability can be established by statute or common law;
  (2) Transmit demand letters to the debtor(s) in conformance with subsection (c) of this section;
  (3) To the extent practicable, maintain individual collection histories of each obligation in order to document attempted contacts with the debtor, the substance of communications with the debtor, efforts to locate the debtor and its assets, and other information pertinent to collection of the delinquent obligation; and
  (4) Utilize warrant hold procedures as provided in subsection (d) of this section.
(c) The Commission will generally transmit two demand letters to a debtor's verified address. The first demand letter will be sent no later than 30 days after the obligation becomes delinquent. If the obligation remains uncollected, a second demand letter should be sent no sooner than 30 days, but not more than 60 days, after the first demand letter. However, if the Charitable Bingo Operations Director or their designee determines that the amount of a delinquent obligation is minimal, the Director or designee may delay the transmission of the second demand letter. Demand letters will be mailed in an envelope bearing the notation "Return Service Requested" in conformity with applicable United States Postal Service regulations. If an address correction is provided by the United States Postal Service, the demand letter will be re-sent to the correct address prior to referral to the OAG. The second demand letter will include a statement that the obligation, if not paid, may be referred to the OAG for collection.
(d) As authorized in §403.055 of the Government Code, the Commission will utilize the Comptroller of Public Accounts' warrant hold procedures to ensure that no treasury warrants will be issued to a debtor until the delinquent obligation is paid.
(e) The Commission will refer uncollected and delinquent obligations to the OAG as provided by this subsection and the OAG's uniform guidelines, which are found at Title 1, §59.2, of the Administrative Code.
  (1) If the debtor is an entity, the Commission will provide the OAG with the name of the entity's registered agent and any principal officers and/or directors of the entity. If the debtor is an individual, the Commission will provide the OAG with the name and last known business address and residence address of the individual.
  (2) Prior to referral of the obligation to the OAG, the Commission will (except in the case where a jeopardy determination has been made under paragraph (5) of this subsection):
    (A) verify the debtor's address and telephone number;
    (B) transmit no more than two demand letters as provided in subsection (c) of this section; and
    (C) verify that the obligation is not legally or practically uncollectible.
  (3) After considering the relevant factors listed in the OAG's uniform guidelines, the Charitable Bingo Operations Director or designee shall determine whether an uncollected obligation will be referred to the OAG for collection. Generally, the Commission will not refer an uncollected obligation if the amount to be collected would be less than the total sum of expenses to the Commission and the OAG required for collection of the obligation. The Charitable Bingo Operations Director or designee may establish a minimum dollar amount for obligations to be referred to the OAG. However, the Commission may, for policy reasons or other good cause, refer an obligation to the OAG even if the amount to be collected is less than the minimum amount established by the Director or designee.
  (4) Generally, an uncollected obligation should be referred to the OAG not later than the 90th day after the date the obligation becomes delinquent, but after the second demand letter is sent.
  (5) If the Charitable Bingo Operations Director or designee reasonably believes that the collection of an obligation is jeopardized, the Director or Designee may issue a jeopardy determination to the debtor stating that the collection of the obligation is in jeopardy and that the amount due is immediately due and payable. In the case of a jeopardy determination, the obligation may be referred to the OAG after the expiration of 20 days after service by personal service or by mail.
  (6) When referring an uncollected obligation to the OAG, and to the extent practicable, the Commission will provide the OAG with:
    (A) copies of all correspondence between the Commission and the debtor;
    (B) a log sheet documenting all attempted contacts with the debtor and the result of such attempts;
    (C) a record of all payments made by the debtor and copies of all checks tendered as payment;
    (D) any information pertaining to the debtor's residence and his assets; and
    (E) copies of any license application, security, final orders, contracts, grants, or instrument giving rise to the obligation.
  (7) Delinquent obligations that warrant referral to the OAG, and upon which an uncollected bond or other security is held, shall be referred to the OAG no later than 60 days after becoming delinquent. All such accounts where the principal has filed for relief under federal bankruptcy laws will be referred to the OAG immediately.
(f) The Commission will not issue a license to, renew a license for, or list on the bingo worker registry any debtor until the delinquent obligation is paid.

Source Note: The provisions of this §402.104 adopted to be effective February 25, 2015, 40 TexReg 814