(A) All claimant agencies of this State and persons on whose behalf the State and its claimant agencies act, in conjunction with the commission, shall cooperate in identifying debtors who owe money to the State and who qualify for prizes pursuant to this chapter from the commission; and the sum of any debt owed to the State or to persons on whose behalf the State and its claimant agencies act must be set off against a prize awarded pursuant to this chapter. This section must be liberally construed to effectuate these purposes.

(B) As used in this section:

(1) "Claimant agency" means any state or local agency, department, board, bureau, commission, or authority to which an individual owes a debt or which acts on behalf of an individual to collect a debt.

(2) "Debt" means a liquidated sum due and owing a claimant agency, which sum has accrued through contract, subrogation, tort, or operation of law regardless of whether there is an outstanding judgment for the sum, or a sum which is due and owing a person and is enforceable by the State or any of its agencies or departments.

(3) "Debtor" means an individual owing money to or having a delinquent account with a claimant agency, which obligation has not been adjudicated as satisfied by court order, set aside by court order, or discharged in bankruptcy.

(4) "Prize" means the proceeds of a lottery prize awarded pursuant to this chapter.

(C) The collection remedy authorized by this section is in addition to and not in substitution for any other remedy available by law.

(D)(1) A claimant agency may submit to the commission a list of the names of all persons owing debts in excess of one hundred dollars to the claimant agency or to persons on whose behalf the claimant agency acts. The full amount of the debt is collectible from lottery winnings without regard to limitations on the amounts that may be collectible in increments through garnishment or other proceedings. The list constitutes a valid lien upon and claim of lien against the lottery winnings of a debtor named in the list. The list must contain the names of the debtors, their Social Security numbers, if available, and other information which would assist the commission in identifying the debtors named in the list.

(2) The commission shall withhold winnings subject to the lien created by this section and send notice to the winner by certified mail, return receipt requested, of such action and the reason why the winnings were withheld. If the winner appears and claims winnings in person, the commission shall notify the winner at that time, by hand delivery, of the action. If the debtor does not protest, in writing, the withholding of the funds within thirty days of notice, the commission shall pay the funds over to the claimant agency. If the debtor protests the withholding of funds, in writing, within thirty days of the notice, the commission shall file an action in interpleader in the circuit court of the county in which the debtor resides, pay the disputed sum into the court, and give notice to the claimant agency and debtor of the initiation of the action.

(3) The liens created by this section rank among themselves as follows:

(a) taxes due the State;

(b) delinquent child support;

(c) delinquent student loans; and

(d) all other judgments and liens in order of the date entered or perfected.

(4) The commission is not required to deduct claimed debts from prizes paid out by a lottery retailer or entities other than the commission.

(5) A list of debtors and debts must be provided, pursuant to this section, periodically as the commission determines by rules and regulations, and the commission is not obligated to retain the lists or deduct debts appearing on the lists beyond the period determined by the rules and regulations.

(6) The commission may prescribe forms, propose rules, and promulgate regulations necessary to carry out the provisions of this section.

(7) The commission and a claimant agency do not incur civil or criminal liability for good faith adherence to the provisions of this section.

(8) The claimant agency shall pay the commission for all costs incurred by the commission in setting off debts in the manner provided in this section. The commission may retain this fee as part of administrative expenses.

(E)(1) Notwithstanding Section 59-150-240 or other confidentiality law, the commission may provide to a claimant agency all information necessary to accomplish and effectuate the intent of this section.

(2) The information obtained by a claimant agency from the commission pursuant to this section must retain its confidentiality and may be used only by a claimant agency in the pursuit of its debt collection duties and practices. An employee or former employee of a claimant agency who unlawfully discloses this information for another purpose, except as otherwise specifically authorized by law, is subject to penalties as provided by law.

(F) The provisions of this section apply only to prizes of five thousand dollars or more and do not apply to retailers authorized by the board to pay prizes of up to five thousand dollars after deducting the price of the lottery game ticket or share.

HISTORY: 2001 Act No. 59, Section 2.