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Bailment Contract

The Bailment Contract form (74-190) (login required) PDF is an agreement between a state agency and the Comptroller’s office that allows the Comptroller’s office to release payroll warrants to the agency before the pay date. The bailment contract applies to twice-monthly, monthly and any postdated payroll, retirement, payroll deduction and reimbursement warrants.

Texas Government Code, Section 403.072(b), requires the Comptroller’s office to hold payroll warrants until payday. However, Texas Government Code, Section 403.072(c), provides for the Comptroller’s office to adopt rules allowing agencies to receive warrants prior to the pay date for timely distribution. The bailment contract accomplishes this with the condition that the warrants are not distributed until payday.

The Comptroller’s Treasury Operations Division will not honor warrants presented for payment prior to payday and will report such occurrences to the Fiscal Management Division.

If a first or second violation occurs, the Fiscal Management Division will notify the agency by letter. The agency must then submit in writing to the Comptroller’s office the corrective steps that will ensure compliance with the bailment contract. On a third violation within a two-year period, the bailment contract may be terminated immediately.

The bailment contract signed by your chief fiscal officer or agency head is considered a perpetual agreement. However, the contract may be terminated by either party with proper notice. It is a good business practice to resubmit the contract when your agency’s senior management changes. Agencies are required to retain a copy of the completed and signed form.

Without a bailment contract, Payment Services will not distribute post-dated warrants to agencies until the payment date.

Glenn Hegar
Texas Comptroller of Public Accounts
Questions? Contact statewide.accounting@cpa.texas.gov
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