PRINTER'S NO. 1736
No. 1461 Session of 1999
INTRODUCED BY HERMAN, BROWNE, THOMAS, HUTCHINSON, MAHER,
McNAUGHTON, PESCI, SAINATO, TRELLO, VANCE, ARGALL, BAKER,
BARD, BARRAR, BATTISTO, BELFANTI, COY, FAIRCHILD, FARGO,
GANNON, GEIST, GODSHALL, HALUSKA, HARHAI, HENNESSEY, HERSHEY,
KAISER, KENNEY, MAITLAND, MANDERINO, McCALL, MICHLOVIC,
MUNDY, NAILOR, NICKOL, PHILLIPS, PLATTS, PRESTON, RAMOS,
READSHAW, ROEBUCK, ROSS, SANTONI, SATHER, SCHRODER, SCHULER,
SEYFERT, B. SMITH, SOLOBAY, STABACK, STAIRS, STERN, STURLA,
SURRA, E. Z. TAYLOR, TIGUE, TRAVAGLIO, WOGAN, WRIGHT AND
YOUNGBLOOD, MAY 6, 1999
REFERRED TO COMMITTEE ON FINANCE, MAY 6, 1999
AN ACT
1 Amending the act of August 26, 1971 (P.L.351, No.91), entitled
2 "An act providing for a State Lottery and administration
3 thereof; authorizing the creation of a State Lottery
4 Commission; prescribing its powers and duties; disposition of
5 funds; violations and penalties therefor; exemption of prizes
6 from State and local taxation and making an appropriation,"
7 providing for a lottery winnings intercept in relation to
8 defaulted student loans obtained originally through the
9 Pennsylvania Higher Education Assistance Agency.
10 The General Assembly of the Commonwealth of Pennsylvania
11 hereby enacts as follows:
12 Section 1. Section 302 of the act of August 26, 1971
13 (P.L.351, No.91), known as the State Lottery Law, is amended by
14 adding definitions to read:
15 Section 302. Definitions.
16 The following words and phrases when used in this chapter
17 shall have the meanings given to them in this section unless the
1 context clearly indicates otherwise:
2 "Debt." An amount owed by a person and may include interest,
3 penalties, charges, costs, fees or any other amount for a
4 student loan guaranteed by or obtained through the Pennsylvania
5 Higher Education Assistance Agency.
6 * * *
7 "PHEAA." The Pennsylvania Higher Education Assistance
8 Agency.
9 * * *
10 Section 2. The act is amended by adding a section to read:
11 Section 315. Lottery winnings intercept.
12 (a) Offset required.--Notwithstanding section 306, payments
13 of more than $2,500 from the State Lottery Fund shall be subject
14 to offset to satisfy defaults on any debt after any outstanding
15 obligations to pay court-ordered child support have been offset
16 in accordance with 23 Pa.C.S. § 4308 (relating to lottery
17 winnings intercept).
18 (b) Check for certain outstanding obligations.--Prior to
19 releasing a prize exceeding $2,500 from the State Lottery Fund,
20 the secretary shall ascertain whether the prize winner has any
21 obligations to pay court-ordered child support, in accordance
22 with 23 Pa.C.S. § 4308 or has defaulted on any debt, in
23 accordance with this section.
24 (c) Information to PHEAA.--The Department of Revenue shall
25 provide PHEAA with the full name and Social Security number of
26 prize winners in excess of $2,500 upon receipt of prize claims.
27 (d) Duty of PHEAA.--PHEAA shall cause a search of its
28 records to determine whether the prize winner has defaulted on
29 any debts. PHEAA shall notify the Department of Revenue within
30 five working days of receipt of the information from the
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1 Department of Revenue if the winner has defaulted on any debts.
2 (e) Default collection procedures.--If it is determined by
3 PHEAA that a prize winner is in default on any debt, PHEAA shall
4 request the Department of Revenue to withhold the amount of any
5 arrearage discovered by PHEAA and to pay, within 30 days of
6 notification by PHEAA, whether in lump sum or by installment, to
7 PHEAA that part of the prize which satisfies the arrearage.
8 (f) Insufficient prize.--If prize winnings are insufficient
9 to satisfy the arrearages owed, PHEAA shall proceed as follows:
10 (1) PHEAA may collect as provided by law.
11 (2) PHEAA may reinitiate the procedures set forth in this
12 section if the obligor wins a subsequent lottery prize.
13 (g) Fees.--PHEAA and the Department of Revenue shall
14 determine and set a fee which reflects the actual costs incurred
15 to administer this section. The Department of Revenue shall
16 deduct the calculated amount from the amount to be paid to the
17 prize winner after any obligation to pay child support under 23
18 Pa.C.S. § 4308 has been fully satisfied and then after any debts
19 in default have been fully repaid under this section, and shall
20 request that the deducted amount be divided between both
21 departments based on the administrative expenses incurred by
22 each.
23 (h) Duty of Department of Revenue.--PHEAA shall request the
24 Department of Revenue to do the following within 30 days of the
25 date the prize was won:
26 (1) Award the prize winner the lottery prize winnings in
27 whole or in part.
28 (2) If applicable, PHEAA shall provide to the Department of
29 Revenue notification and the Department of Revenue shall provide
30 such notification to the prize winner that the prize, or a
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1 portion thereof, was used to satisfy arrearages owed for any
2 debt in default.
3 (i) PHEAA notice to obligors.--PHEAA shall send a one-time
4 notice to all obligors of existing orders informing them that
5 any debt in default may be intercepted as provided by this
6 section.
7 (j) Appeals.--A lottery prize winner whose prize is used to
8 satisfy a debt in default under this section may appeal to PHEAA
9 in accordance with PHEAA procedures. The appeal shall be filed
10 within 30 days after the prize winner is notified by the
11 Department of Revenue that the prize has been reduced or totally
12 withheld to satisfy the prize winner's debt in default and other
13 related obligations.
14 (k) Regulations.--PHEAA and the Department of Revenue shall
15 promulgate any regulations which may be necessary to carry out
16 the provisions of this act.
17 Section 3. This act shall take effect in 60 days.
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