2005 California Government Code Sections 16580-16586 CHAPTER 4.3. THE ACCOUNTS RECEIVABLE MANAGEMENT ACT

16580.  This chapter shall be known and may be cited as the Accounts
Receivable Management Act.
16581.  "Participant" for the purposes of this chapter means all
state agencies, departments, and offices.
16582.  Within the uniform state payroll system, the Controller may,
for each participant, disregard errors of twenty-five dollars ($25)
or less in individual accounts receivable, if he or she has
determined that time and expense will be saved in doing so.
16583.  (a) Each participant shall allocate collection resources
based on giving highest priority to those accounts with the highest
expected return.
   (b) Each participant shall consult with the Franchise Tax Board or
any other state agency that has successfully established an
effective accounts receivable collection system.
16584.  (a) A participant may enter into a contract with a private
debt collector or private person or entity for the assignment or sale
of all or part of its accounts receivable, provided that the
participant does all of the following:
   (1) Determines the assignment or sale is likely to generate more
net revenue or net value than equivalent state efforts including
collections efforts pursuant to Section 16583.5.
   (2) Determines the assignment or sale will not compromise future
state revenue collections.
   (3) Notifies the debtor in writing at the address of record that
the alleged accounts receivable debt will be turned over for private
collection unless the debt is paid, or appealed within a time period,
as determined by the participant.
   (b) No participant shall enter into a contract for the assignment
or sale of any accounts receivable pursuant to subdivision (a) if the
accounts receivable debt has been contested.
   (c) Any contract entered into pursuant to this section is subject
to Article 4 (commencing with Section 10335) of Chapter 2 of Part 2
of Division 2 of the Public Contract Code.
16585.  (a) A city, county, or city and county may sell or transfer
part or all of its accounts receivable to a private debt collector or
private persons or entities, provided the city, county, or city and
county notifies the debtor in writing at the address of record that
the alleged accounts receivable debt will be turned over for private
collection unless the debt is paid, or appealed within a time period,
as determined by the city, county, or city and county providing the
notice.
   (b) No city, county, or city and county shall assign or sell any
account receivable pursuant to subdivision (a) if the account
receivable debt been contested.
16586.  Claims for reimbursement under Sections 11487 and 11487.5 of
the Welfare and Institutions Code are not subject to this chapter.