(a) (1) (A) As a condition of employment, a person hired or appointed to a position in any agency in state government on or after August 12, 2005, shall be required to accept payment of salary or wages by electronic warrants transfer.

(B) The electronic warrants transfer shall be made in the form of a direct deposit of funds to the account of the beneficiary of the payment in any financial institution equipped for electronic fund transfers, provided that the financial institution is designated in writing by the beneficiary and has lawful authority to accept such deposits.

(2) (A) (i) Any person affected by the direct deposit requirement set forth in subdivision (a)(1) of this section may request an exemption from the requirement.

(ii) The Chief Fiscal Officer of the State may grant an exemption from the direct deposit requirement upon a showing of hardship to the person requesting the exemption or upon any other reasonable basis.

(B) The Chief Fiscal Officer of the State shall establish the standards and procedures for granting an exemption from the direct deposit requirement set forth in subdivision (a)(1) of this section.

(3) The direct deposit requirement set forth in subdivision (a)(1) of this section shall not apply to a person who is in the employment of the state prior to August 12, 2005, and subsequently receives a promotion appointment, transfer, or other change in position within the same personnel system on or after August 12, 2005.

(b) (1) As used in subdivision (a)(1) of this section, "agency" means all state agencies, boards, commissions, bureaus, councils, or programs except:

(A) The elected constitutional officers of the State of Arkansas and their employees;

(B) The General Assembly and its employees, including employees of the Bureau of Legislative Research and Arkansas Legislative Audit;

(C) Members and employees of the Supreme Court, the Administrative Office of the Courts, circuit courts, and prosecuting attorneys, not including deputy prosecuting attorneys;

(D) The Arkansas State Game and Fish Commission;

(E) The Arkansas Department of Transportation; and

(F) All administrative, academic, classified, and nonclassified employees of the state-supported institutions of higher education.

(2) Any agency, board, commission, bureau, council, or program exempted under this subsection from the direct deposit requirement set forth in subdivision (a)(1) of this section may elect to enter the electronic warrants transfer system on a voluntary basis.

(c) The Chief Fiscal Officer of the State may establish any special account necessary to facilitate direct deposit of employee salaries or wages.