justice court clerks join the court registry law

The text as introduced · 1,477 words

89R5027 AMF-D

By: Eckhardt
S.B. No. 2157

A BILL TO BE ENTITLED

AN ACT

relating to deposits of funds into a court registry by a clerk of a

justice court.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 117.001(2), Local Government Code, is

amended to read as follows:

(2) "Clerk" means a justice court clerk, a county

clerk, a district clerk, or a county and district clerk.

SECTION 2. Sections 117.002 and 117.003, Local Government

Code, are amended to read as follows:

Sec. 117.002. TRANSFER OF UNCLAIMED FUNDS TO COMPTROLLER.

Any funds deposited under this chapter, except cash bail bonds,

that are presumed abandoned under Chapter 72, 73, or 75, Property

Code, shall be reported and delivered by the justice court, county ,

or district clerk to the comptroller without further action by any

court. The dormancy period for funds deposited under this chapter

begins on the later of:

(1) the date of entry of final judgment or order of

dismissal in the action in which the funds were deposited;

(2) the 18th birthday of the minor for whom the funds

were deposited; or

(3) a reasonable date established by rule by the

comptroller to promote the public interest in disposing of

unclaimed funds.

Sec. 117.003. COMPLIANCE WITH FEDERAL TAX LAW FOR FUNDS

HELD UNDER THIS CHAPTER. (a) If any funds deposited under this

chapter are placed into an interest-bearing account, any person

with a taxable interest in funds deposited to such account must

submit appropriate tax forms and provide correct information to the

justice court, county, or district [ or county ] clerk so that the

interest earned on such funds can be timely and appropriately

reported to the Internal Revenue Service. The information and

forms provided to the [ district or county ] clerk under this section

are not subject to public disclosure except to the extent necessary

to effectuate compliance with federal tax law requirements.

(b) The justice court, county, or district [ or county ] clerk

is authorized to pay any or all of the interest earned on funds

deposited under this chapter, without court order, to the Internal

Revenue Service to satisfy tax withholding requirements.

SECTION 3. Sections 117.021(a) and (d), Local Government

Code, are amended to read as follows:

(a) The commissioners court of a county shall select by the

process provided by this subchapter or by Subchapter C, Chapter

262, a federally insured bank or banks in the county to be the

depository for a special account held by the justice court clerks,

county clerk , and [ the ] district clerks. The county shall enter a

contract with the selected federally insured bank or banks for a

two-year or four-year term. The original term can be renewed once

for an additional two-year term. The contract may, on request by a

[ the ] clerk and approval of the commissioners court, include a

provision that the funds in a special account earn interest. A

request from a [ the ] clerk that an account earn interest must be

made, in writing, to the commissioners court not later than the 30th

day before the date the county gives notice under Section 117.022

and shall be entered in the minutes of the court.

(d) A bank must file its application on or before a date set

by the commissioners court. The application must be accompanied by

a certified check or cashier's check for at least one-half of one

percent of the average daily balance of the registry funds held by

the justice court clerks, county clerk , and [ the ] district clerks

[ clerk ] during the preceding calendar year, as determined by the

[ county ] clerk [ and the district clerk ] on or before the 10th day

before the date the application is required to be filed. A

certified check or cashier's check that complies with this section

is a good-faith guarantee on the part of the applicant that if its

application is accepted it will execute the bond required under

this subchapter. If the bank selected as depository does not

provide the bond, the county shall retain the amount of the check as

liquidated damages and the county shall select another depository

as provided by this subchapter.

SECTION 4. Section 117.022, Local Government Code, is

amended to read as follows:

Sec. 117.022. NOTICE. A county shall advertise or give

notice that the county will accept applications to be the

depository for registry funds held by the justice court clerks,

county clerk , and [ the ] district clerks [ clerk ] in the same manner

as notice is required under Section 116.022.

SECTION 5. Section 117.023(a), Local Government Code, is

amended to read as follows:

(a) At the meeting at which banks are to be selected to serve

as the depository for registry funds held by the justice court

clerks, county clerk , and [ the ] district clerks [ clerk ], the

commissioners court shall enter the applications in the minutes of

the court and select a depository.

SECTION 6. The heading to Section 117.052, Local Government

Code, is amended to read as follows:

Sec. 117.052. DEPOSITS OF REGISTRY FUNDS BY JUSTICE COURT,

COUNTY , AND DISTRICT CLERKS.

SECTION 7. Section 117.052(a), Local Government Code, is

amended to read as follows:

(a) If a depository has been selected under Subchapter B, a

justice court clerk, county clerk , or [ a ] district clerk who is to

have , for more than three days , legal custody of money deposited in

the registry of the court pending the result of a legal proceeding

shall deposit the money in the depository.

SECTION 8. Section 117.053(a), Local Government Code, is

amended to read as follows:

(a) If a commissioners court selects a new depository under

Subchapter B, when the depository qualifies, the justice court

clerks, county clerk , and [ the ] district clerks [ clerk ] shall

transfer the funds in a special account from the old depository to

the new depository, and the clerks may draw checks on the accounts

for this purpose.

SECTION 9. Section 117.056(a), Local Government Code, is

amended to read as follows:

(a) A depository selected under Subchapter B shall pay a

check drawn by a justice court, county , or district clerk against

funds deposited in the clerk's name on presentment of the check at

the county seat if the funds subject to the check are in the

possession of the depository.

SECTION 10. Section 117.057(a), Local Government Code, is

amended to read as follows:

(a) A commissioners court may require a depository selected

under Subchapter B to execute a new bond whenever the commissioners

court considers it necessary for the protection of the justice

court clerks', county clerk's , and [ the ] district clerks' [ clerk's ]

registry funds.

SECTION 11. Section 117.058(b), Local Government Code, is

amended to read as follows:

(b) If the commissioners court of a county provides a

depository for the registry funds of the justice court clerks,

county clerk , or [ the ] district clerks [ clerk ], those officers

shall make reports under oath to the county auditor to properly

reflect all registry funds received and disbursed by the officer,

including all money remaining on hand at the time of the report.

The county auditor shall prescribe the form and frequency of the

report.

SECTION 12. Sections 117.081 and 117.083, Local Government

Code, are amended to read as follows:

Sec. 117.081. LIABILITY OF JUSTICE COURT, COUNTY , AND

DISTRICT CLERKS. (a) A justice court clerk, county clerk , or [ a ]

district clerk is not responsible for a loss of registry funds

resulting from the failure or negligence of a depository.

(b) This section does not release a justice court clerk,

county clerk , or [ a ] district clerk from:

(1) liability for a loss of registry funds resulting

from the clerk's official misconduct, negligence, or

misappropriation of the funds; or

(2) responsibility for keeping the registry funds safe

until the clerk deposits them in a depository selected under

Subchapter B.

(c) After a justice court clerk, county clerk , or [ a ]

district clerk deposits in a depository selected under Subchapter B

the registry funds held by the clerk, the clerk is relieved of the

responsibility for keeping the funds secure.

Sec. 117.083. LOSS OF REGISTRY FUNDS. If registry funds

held by a justice court clerk, county clerk , or [ a ] district clerk

and deposited by the county with a depository selected under

Subchapter B are lost for any reason, including a loss due to the

insolvency of the depository, the county is liable to the rightful

owner of the funds for the full amount of the funds due the owner.

SECTION 13. This Act takes effect September 1, 2025.