Forms
Bailment Contract
The Bailment Contract form (74-190) is an agreement between a state agency and the Comptroller’s office that allows the Comptroller’s office to release postdated payroll warrants to the agency before payday. The bailment contract applies to semimonthly, 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) authorizes the Comptroller’s office to adopt rules allowing agencies to receive their postdated payroll warrants before payday for timely distribution to their employees. The bailment contract accomplishes this with the condition that the warrants are not distributed to the employees until payday. See Payroll Due Dates and Direct Deposit Schedules for the current fiscal year’s paydays.
Postdated payroll warrants will not be distributed until payday to any agency or institution of higher education that does not submit a completed and signed Bailment Contract to the Comptroller’s office.
The Comptroller’s Treasury Operations Division (Treasury Operations) will not honor warrants presented for payment before payday and will return them to the financial institution, which could result in fees or charges for the employee.
Treasury Operations will also 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 or email. The agency must then submit to the Comptroller’s office in writing the corrective steps it will implement to ensure compliance with the bailment contract. On a third violation within a two-year period, the bailment contract may be terminated immediately. If an agency’s contract is terminated, postdated payroll warrants will not be available for pickup or mailed to the agency until the issue date on the warrants.
A single violation of the bailment contract is when a payroll warrant is presented to Treasury Operations for payment before the warrant issue date.
| If … | Then … |
|---|---|
| On Dec. 28 Treasury Operations reports 15 payroll warrants as having been presented for payment before the warrant issue date of Jan. 3 | It is considered one violation |
| On Dec. 28, Treasury Operations reports two payroll warrants with a Dec. 31 issue date and two payroll warrants with a Jan. 3 issue date as having been presented for payment before their issue dates | It is considered two violations |
| NOTE: Financial institutions may assess fees when funds are refused by Treasury Operations from the original deposit. Employees may incur fees and other charges from their financial institution if they attempt to deposit a warrant before the issue date. | |
The bailment contract signed by an agency head or chief fiscal officer 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 the 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 postdated warrants to agencies until the payment date.