Definitions

Term	Definition
remote deposit of checks	We have had several questions about retention and confidentiality of checks when a unit uses remote deposit. We conferred with the Indiana Commission on Public Records about the retention of these checks and their suggestion will be that retention of the checks remain 3 years, however; based on OCPR policy 06-01 (see http://www.in.gov/icpr/files/policyelectronic10years.pdf); the paper can be destroyed after the documents have been scanned and are in the digital repository, so long as the total retention is less than 10 years. We conferred with the Public Access Counselor in regard to confidentiality and he provided that the confidential financial provision, IC 5-14-3-4(a)(5), would allow an agency to redact the person’s account and routing number from the check. The social security number would be considered confidential pursuant to IC 5-14-3-4(a)(12).
returned checks	RETURNED CHECKS – NON SUFFICIENT FUNDS (under review by SBOA) An extended effort shall be made by the treasurer to recover funds from checks returned by the depositories as uncollectible. During the process of collecting, the return checks shall be carried as a cash item and the tax duplicate so noted. DO NOT REMOVE OR DELETE THE PAYMENT ON THE TAX DUPLICATE. The treasurer should immediately notify the maker or drawer of the returned check. We recommend you develop a form letter detailing the procedures and consequences of not making the returned check good. Contact by telephone is usually more expedient; however you should probably follow up your verbal conversation with the form letter. If the drawer comes in to pay make sure you only accept cash, certified check or money order. The amount necessary to redeem the returned check is: 1. The amount of the returned check 2. The actual charge by the financial institution 3. An amount not to exceed twenty dollars In order to collect #3 above, the board of county commissioners will need to enact a Home Rule Ordinance establishing this returned check fee. When it is determined that the return item is uncollectible, the treasurer shall attach all related documents to a regular claim to be presented to the board of county commissioners, with an explanation. Upon the commissioner's approval of payment from the general fund, without appropriation, the county warrant is placed in the cash drawer to replace the uncollectible item and deposited as other checks. The amount of tax shall be recharged on the proper duplicate by the auditor. The amount reimbursed to the treasurer shall be deducted from the amount for apportionment in the appropriate taxing district in the next December settlement and returned to the county general fund. This amount should be shown on line 39 of the apportionment and settlement sheets as "reimbursements to county treasurer for bad checks." IC 26-2-7-5 allows counties to pursue collection of these returned checks through the courts. IC 26-2-7-5 states in part: "A person…is also liable for all of the following: (1) Interest at the rate of eighteen percent (18%) per annum… (2) Court costs… (3) Reasonable attorney's fees… (4) Actual travel expenses…to… (A) An employee or agent of the holder to file papers and attend court proceedings… (B) Provide witnesses to testify in court… (5) A reasonable amount to compensate the holder for time used to… (A) File papers and attend court proceedings… (B) Travel to and from activities… (6) Actual direct and indirect expenses incurred by the holder to compensate employees and agents for time used to… (A) File papers and attend court proceedings… (B) Travel to and from activities… (7) All other reasonable cost of collection." IC 26-2-7-6(b) states: "If a person liable under this chapter does not pay to the holder the full amount of the check not more than thirty (30) days after the certified mailing of written notice that the check has not been paid the person is liable for, and the court shall award judgment for, the following, whichever applies: (1) If the face amount of the check is not greater than two hundred fifty dollars ($250), three (3) times the face amount of the check. (2) If the face amount of the check is greater than two hundred fifty dollars ($250), the face amount of the check plus five hundred dollars ($500)." If the county chooses to purse collection by the procedures listed in IC 26-2-7, any amounts collected over the face amount of the check would be receipted to the General Fund. Bank service charges may be paid to the treasurer along with the bad check at the time of reimbursement by the general fund or since money is already out of the bank account, the county auditor may post a disbursement in the general fund for the service fee. No check is written.

Term

Definition

We have had several questions about retention and confidentiality of checks when a unit uses remote deposit. We conferred with the Indiana Commission on Public Records about the retention of these checks and their suggestion will be that retention of the checks remain 3 years, however; based on OCPR policy 06-01 (see http://www.in.gov/icpr/files/policyelectronic10years.pdf); the paper can be destroyed after the documents have been scanned and are in the digital repository, so long as the total retention is less than 10 years. We conferred with the Public Access Counselor in regard to confidentiality and he provided that the confidential financial provision, IC 5-14-3-4(a)(5), would allow an agency to redact the person’s account and routing number from the check. The social security number would be considered confidential pursuant to IC 5-14-3-4(a)(12).

returned checks

RETURNED CHECKS – NON SUFFICIENT FUNDS (under review by SBOA)

An extended effort shall be made by the treasurer to recover funds from checks returned by the depositories as uncollectible. During the process of

collecting, the return checks shall be carried as a cash item and the tax duplicate so noted. DO NOT REMOVE OR DELETE THE PAYMENT ON THE TAX DUPLICATE.

The treasurer should immediately notify the maker or drawer of the returned check. We recommend you develop a form letter detailing the procedures and consequences of not making the returned check good. Contact by telephone is usually more expedient; however you should probably follow up your verbal conversation with the form letter. If the drawer comes in to pay make sure you only accept cash, certified check or money order. The amount necessary to redeem the returned check is:

1. The amount of the returned check

2. The actual charge by the financial institution

3. An amount not to exceed twenty dollars

In order to collect #3 above, the board of county commissioners will need to enact a Home Rule Ordinance establishing this returned check fee. When it is determined that the return item is uncollectible, the treasurer shall attach all related documents to a regular claim to be presented to the board of county commissioners, with an explanation. Upon the commissioner's approval of payment from the general fund, without appropriation, the county warrant is placed in the cash drawer to replace the uncollectible item and deposited as other checks. The amount of tax shall be recharged on the proper duplicate by the auditor. The amount reimbursed to the treasurer shall be deducted from the amount for apportionment in the appropriate taxing district in the next December settlement and returned to the county general fund. This amount should be shown on line 39 of the apportionment and settlement sheets as "reimbursements to county treasurer for bad checks." IC 26-2-7-5 allows counties to pursue collection of these returned checks through the courts.

IC 26-2-7-5 states in part: "A person…is also liable for all of the following:

(1) Interest at the rate of eighteen percent (18%) per annum…

(2) Court costs…

(3) Reasonable attorney's fees…

(4) Actual travel expenses…to…

(A) An employee or agent of the holder to file papers and attend court proceedings…

(B) Provide witnesses to testify in court…

(5) A reasonable amount to compensate the holder for time used to…

(A) File papers and attend court proceedings…

(B) Travel to and from activities…

(6) Actual direct and indirect expenses incurred by the holder to compensate employees and agents for time used to…

(A) File papers and attend court proceedings…

(B) Travel to and from activities…

(7) All other reasonable cost of collection."

IC 26-2-7-6(b) states: "If a person liable under this chapter does not pay to the holder the full amount of the check not more than thirty (30) days after the certified mailing of written notice that the check has not been paid the person is liable for, and the court shall award judgment for, the following, whichever applies:

(1) If the face amount of the check is not greater than two hundred fifty dollars ($250), three (3) times the face amount of the check.

(2) If the face amount of the check is greater than two hundred fifty dollars ($250), the face amount of the check plus five hundred dollars ($500)."

If the county chooses to purse collection by the procedures listed in IC 26-2-7, any amounts collected over the face amount of the check would be receipted to the General Fund. Bank service charges may be paid to the treasurer along with the bad check at the time of reimbursement by the general fund or since money is already out of the bank account, the county auditor may post a disbursement in the general fund for the service fee. No check is written.