Collection Improvement Program
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Collection Improvement Program
Office of Court Administration
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2
Texas Office of Court Administration
• State Agency• Created in 1977• Chief Justice - Texas Supreme
Court• Provides Administrative &
Technical Support• Serves Approximately 2,600
Courts in the State• (512) 463-1625
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THE ISSUE
“Lack of compliance in paying court fines and fees denies a
jurisdiction revenue and, more important, calls into question the
authority and effectiveness of the court and the justice system.”
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Five-Part Presentation
• The Concept of Change• Origins of the Collection Improvement Program• Collections Tools & Technology• Selecting A Vendor• The Real Issue
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“In Order to Grow We Must Make A Conscious
Decision to CHANGE!”
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“Change is often not easily embraced but is almost always
inevitable.” ATTITUDEATTITUDE KNOWLEDGEKNOWLEDGE TIMETIME HAM FACTORHAM FACTOR
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Quotation Station
“You can't stop change from coming, you can only usher it in and work out the terms. If you're smart and a little lucky, you can make it your friend.”
-Barack Obama
Not everything that is faced can be changed, but nothing can be changed until it is faced.
-James Baldwin
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Dallas County Collections Program
GENESIS
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1992 Cases Receiving Payouts
Over 90 days11%
Within 90 Days38%
Warrant39%
No Warrant
12%
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Findings• 51% of all money owed was
outstanding, either with a warrant or just uncollected.
• If the money wasn’t collected in the first 90 days, usually not collected!
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Court Collections
• Current - 60 Days• 60 - 180 Days
• 180 Days plus
• 25 % Collected• 65 % Collected
(Warrant)• 10 % Collected
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Private Sector Account Management
• Current - 30 Days • 31 - 60 Days• 61 - 120 Days• 120 Days Plus
• 85% Collected• 10% Collected• 3% Collected• 2% Collected -
Charge Off/Write Off
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Proactive Proactive Enforcement Enforcement Plan and Plan and ProcedureProcedure
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OCA’S VOLUNTARY PROGRAMS
• The Office of Court Administration (OCA) became involved in the search for a solution to this issue in the mid-1990s.
• By the end of the decade the agency had adopted a collections model based on the program used in Dallas County, which employs proactive, private sector techniques with great success.
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2005 Senate Bill 1863Collection Improvement Programs (78)
• Counties 50,000 54• Cities 100,000 24• Half by 04/06• Half by 04/07
79th Legislature
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Major Components
• Requires specific “in-house” management of current cases as outlined by OCA
• Requires strict management of delinquent cases which may include outsourcing
• Annual program reports
• Punitive measures for non-compliance
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Collection Windows & Remedies
• Pre-Appearance• Appearance• Non-Compliance/Default• Pre-Capias Pro Fine• Post Capias Pro Fine
• Phone Calls• Notices
(letters/postcards)• Warrants• Amnesty Programs• Warrant Round Ups• Non-renewal of DL• Denial of Vehicle Reg.• Civil Remedies
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Collection Tools
Courtesy Cards
Applications
Interviews
Warning Calls
Warning Cards
Warrant Calls
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Collection ToolsStatutory
• DL Suspension• Vehicle Registration Denial• Recreational License Suspension• Professional License Suspension• Wage Attachment• Commissary Account Attachment• Tax Refund Intercept
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Collection ToolsInternet Services
• usps.com• whitepages.com• accurint.com• masterfiles.com• nstn.net• publicdata.com• zabasearch.com• phonevalidator.com• freetranslator.com
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Phone Evolution
Electronic PaymentVoice Mail
Predictive Dialing
Contact
Up Date Records
Progressive Dialing
Scheduler
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Consumer makes contact •On line•By phone•In person•Store Front
Vendor’s System
Posts to Customer File
Recap Report-Next Business Day via
Fax
Web Reporter
Direct Deposit to bank or ACH On site printed funds check
Validation System
Payment InnovationsCredit Cards , Kiosk, Electronic Transfer, Remote
Payment is received and transmitted electronically
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• Discovery• Strategy
• Implementation• Evaluation
• Find out where you really are.• Develop a plan to put you where
you want to (should) be.• Just Do It! • Don’t be afraid to make changes.
Action Plan
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Establishing Local NeedThree Questions
• How much is uncollected?
• How do collections compare with assessments?
• Do WE have a problem or an opportunity?
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Establishing Local NeedFollow the Money
• Finance Office• Budget Office• Auditor’s Office• Court Administration• Financial Records
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Enforcement Model
• Staff or staff time dedicated to collection activities.
• Expectation that all court costs, fees, and fines are generally due at the time of sentencing or pleading.
• In most cases, defendants unable to pay in full on the day of sentencing or pleading are required to complete an application for extension of time to pay.
• Application information is verified and evaluated to establish an appropriate payment plan for the defendant.
“Key Elements”
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Enforcement Model
• Payment terms are usually strict (e.g., 50% of the total amount due must be paid within 48 hours; 80% within 30 days; and 100% within 60 days).
• Alternative enforcement options (e.g., community service) are available for those who do not qualify for a payment plan.
• Defendants are closely monitored for compliance, and action is taken promptly for non-compliance. Actions include telephone contact, letter notification, and possible issuance of warrant.
“Key Elements”
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Enforcement Model
• A county or city may contract with a private attorney or a public or private vendor for the provision of collection services on delinquent cases (61+ days), after in-house collection efforts are exhausted.
• Application of statutorily permitted collection remedies, such as programs for non-renewal of driver’s license or vehicle registration.
• Issuance and service of warrants, as appropriate.
“Key Elements”
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Three C’s of Enforcement
• Control – Required to manage.
• Contact - Required to connect.
• Consistency – Required to conclude.
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Outsourcing As A Tool
$100,000 (65-90%)
60,000 (60%)
- 6,000 (Less Cost)
+12,000 (30% of $40K Uncollected)
$ 66,000 (Net Revenue)
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IT WORKS BETTER TOGETHER
IN-HOUSE OUTSOURCE IN-HOUSE+
OUTSOURCE
$54,000 $30,000 $66,000
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Selecting A VendorInitiating the Process
• Always begin with a Request for Information (RFI).
• Use the information from the RFI to create a Request for Proposal (RFP).
• Use both to narrow the list of Candidates.
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Selecting A Vendor
Vetting Process
• Well Documented Industry Credentials
• Valid Licensing in All States
• Specific Case Expertise & Work Plan
• Background Checks & Staff Training
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Selecting A Vendor
Vetting Process •Existing & Prior Client List/References
• Require In-Person Finalist Presentations
• Visit the Selected Vendor’s Facility
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Selecting A Vendor
Research Complaints & Legal Actions
»- Better Business Bureau»- www.RipOffReport.com »- www.Complaints.com»- www.Google.com
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Selecting A Vendor Contracts
• Write Your Own “Customized” to Fit Your Needs.
• Payments to Court, to Agency or to BOTH…-Capabilities & Methods Supported
* Credit & Debit Cards* Cash, Checks & Money Orders* Western Union, MoneyGram & Others* Online, Phone, Mail & In-Person
• Remittance Procedures - Frequency & Methodology (ACH or Check)
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Selecting A Vendor
Other Considerations
• Skip Tracing Processes & Procedures• Recording & Archiving of Calls• Insurance Coverage & Surety Bonds• IT Capacity & Internal Infrastructure• Online Access to Reports & Case Data• Business Continuity/Disaster Recovery Plans
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Selecting A Vendor
Emerging Industry Trends
• Selling Obligations to Private Sector Firms• Using Primary & Secondary Vendors • Incentives for Guaranteed Returns.• Penalties for Failure to Meet Target
Recovery Rates.
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Common Plan Issues
• Uniform Collection Policy• Program/Project Supervision & Management• Targets & Goals• Participation• Staff selection, criteria, qualifications• Functional Logistics- physical location(s),
furniture, equipment, forms, supplies, etc.• Funding and/or Budget Issues
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Keys to Success
• Judicial Understanding & Commitment• Simplicity (kiss)• Internal Communication & Cooperation• Quality Staffing• Investment in & Efficient Use of Technology
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Jim Lehman
Office of Court Administration
205 West 14th Street, Suite 600
Austin, Texas 78701
(512) 936-0991
Russ Duncan
Compliance/Collections Specialist
FLCCOC–2541-1 Barrington Circle
Tallahassee, Florida 32308
(352) 503-7490