SECTION 107.6. Penalty for Late Reporting; Waiver of Penalty

(a) In this section "report" means the combination of all information and contributions required to be provided to and deposited with the system for each month of participation, in accordance with Chapter 845, Subchapter E, Government Code.

(b) A due date of a monthly report that is a Saturday, Sunday, or legal holiday is extended to the first day that is not a Saturday, Sunday, or legal holiday, but the dates provided by §845.407(c) for eligibility for an exemption from a penalty assessment are not extended if they fall on a Saturday, Sunday, or legal holiday. The penalty for a past-due report consists of an administrative fee in the amount provided by §845.407(a), Government Code, plus interest on the past-due amounts for each day past due computed at an annual rate provided by that subsection.

(c) If a report is past due, the system shall notify each member of the county commissioners' court or the chief employee of the subdivision stating the due date of the report, that the report was not received by the due date, that unless the subdivision submits proof satisfactory to the system that the report was sent in compliance with §845.407(c), Government Code, the subdivision is subject to a penalty for late reporting in accordance with §845.407(a), Government Code, and that the amount of the penalty will be computed and assessed on receipt of the report. If applicable, the notice shall also state that the subdivision is eligible for a waiver of the late reporting penalty under subsection (g) of this section.

(d) After the system receives the past-due report, a notice shall be mailed to each member of the county commissioners' court or the chief employee of the subdivision stating that a penalty has been assessed for late reporting in accordance with §845.407, Government Code, and indicating the date the report was received by the system, the number of days the report was past due, the amount of contributions on which interest was charged, the accumulated interest and the administrative fee. The notice shall inform each member of the county commissioners' court or the chief employee that if the penalty is not paid within the period provided by §845.407(a), Government Code, the penalty shall be deducted from the subdivision's account in the Subdivision Accumulation Fund and credited to other funds of the system in accordance with that subsection.

(e) The amount of the penalty stated in the notice described by subsection (d) of this section becomes fixed and final on the tenth business day following the date of the notice and may not be modified thereafter for any reason.

(f) For purposes of §845.407, Government Code, approved same-day or overnight delivery services are:

(1) Federal Express;

(2) United Parcel Service;

(3) Lone Star Overnight;

(4) United States Postal Service; and

(5) any other delivery service that provides same-day or overnight delivery accompanied by written proof of the date of mailing by the subdivision.

(g) In the event a participating subdivision fails to timely file its required monthly report with the system, and either before or after receipt of the late notice advice from the system, the subdivision files the report within five business days of its original due date, the system will waive the late reporting penalty imposed by §845.407, Government Code, if the subdivision has not received a waiver in the preceding twenty-four month period. In no event shall any participating subdivision receive more than one waiver of the late reporting penalty in any twenty-four month reporting period.

(h) In the event a subdivision receives a waiver of the late reporting penalty as provided in subsection (g) of this section, the system shall notify each member of the county commissioners' court or the chief employee of the subdivision that the subdivision received the waiver and that it will not be eligible for another waiver of the late reporting penalty in the following twenty-four month period.

(i) For purposes of computing the "preceding" and "following" twenty-four month periods described by subsections (g) and (h) of this section, the periods shall be calculated using the due dates of the monthly reports as described in Chapter 845, Subchapter E, Government Code. The "preceding" twenty-four month period described in subsection (g) of this section begins with the month a report was due as the first month and counts back twenty-four months. The "following" twenty-four month period described in subsection (h) of this section begins with the month a waiver was granted as the first month and counts forward twenty-four months.

(j) The waiver provision provided in subsection (g) of this section in no way alters any obligation or procedure of the system to enforce the monthly reporting and penalty requirements of Chapter 845, Subchapter E, Government Code.

Source Note: The provisions of this §107.6 adopted to be effective December 31, 1999, 24 TexReg 9302; amended to be effective October 1, 2001, 26 TexReg 7576; amended to be effective October 3, 2010, 35 TexReg 8977