Pay Cards for Payroll Retirement Payments

Overview

Applicable to

State agencies. Excludes institutions of higher education.

Summary

Pay cards for payroll, travel or retirement payments provide an optional alternative from warrants or direct deposit to a debit card. State employees and annuitants can contact their paying agency to elect this option. Paying agencies may not require a payee to use a pay card.

The Comptroller’s contract bank (the bank) loads the pay cards with the payment. Payees can then use the card at the point-of-sale or receive cash from an ATM. There is no fee for point-of-sale purchases, and other fees are nominal for the payee.

The pay card program provides a convenient financial management tool to the payee and savings to the state from not printing and distributing warrants.

Comptroller Requirements

Authorization form

Payees complete the Pay Card Enrollment Authorization (74-224) to enroll in the pay card program. The paying agency must provide the payee with hard copies of the federally required disclosures before providing and processing the enrollment form. These documents and the requirements are posted on TexPayment Resource – Pay Card. State agencies must certify on the enrollment form that the required disclosure forms were provided to the payee before enrollment.

The enrollment form must be completed in its entirety by the payee and paying agency and will be returned if any information is omitted. No alterations to the authorization language will be accepted.

This form authorizes the Texas Comptroller of Public Accounts (Comptroller’s office) to deposit payroll/travel or retirement payments from the state of Texas to the payee’s pay card account. At the request of the paying agency, the Comptroller’s office will reverse any payments made in error from the payee’s pay card account.

Prenote period

A prenotification (prenote) test is sent to the bank for all new pay card accounts, the same as other types of direct deposit. The prenote period is three banking days.

Allow for 10 days

The setup of direct deposit instructions for a pay card must be completed no later than 10 days before payments are processed for that payment period. This ensures sufficient time for the prenote period to complete and for the payee to receive the pay card. Payees must activate their card as soon as it is received to ensure timely posting of their payments to the card.

Savings account

A pay card account will only be set up as a checking account. A savings account cannot be set up for a pay card.

Travel reimbursement

Employee travel reimbursement payments can be added to the pay card, whether issued to a PR or SP payroll mail code or non-payroll mail code.

Bank Requirements

Payee identity verification

To issue a pay card, the bank must capture certain identifying information in compliance with the Patriot Act, as is required of all banking establishments. The payee must provide the following on the Pay Card Enrollment Authorization (74-224):

• Payee name.
• Physical home address (cannot be a post office box).
  • Pay cards will be mailed to this address.
  • Payee must provide the correct residential mailing address.
• Social Security number.
• Date of birth.
• Country of citizenship.
• Country of residency.

What payees can expect

If the timing does not permit the pay card to be loaded on the payment issue day, the payee will receive a warrant for that payment. After that, the payee can expect payments to be available on payday just like direct deposit. Once the initial payment has been made, payees should have access to the funds on the pay card.

Fraud protection process

The bank enforces standard fraud detection measures. A payee who selects a pay card must be informed of potential instances when funds could be delayed. The bank’s fraud detection process determines when a payment may be flagged for research. If potential fraud is identified, access to the payee’s account may be delayed for a short period, frozen until the issue is resolved or the funds may be returned.

Fees

The bank offers the state of Texas a nominal fee structure for pay cards. There is no fee for point-of-sale purchases, which may eliminate some costs to the payee.

This fee structure may change after the payee terminates state employment or requests the paying agency cancel the pay card. If employees have an existing pay card when they become state retirees, they must re- enroll using the Pay Card Enrollment Authorization form. Pay cards kept after state payments end may incur fees based on standard bank pricing. Payees are advised to ask the bank's customer service representatives about any potential fee changes.

Pay card questions

Paying agencies must provide the payee with the required disclosure forms about fees and any additional marketing materials before enrollment. Once enrolled, the payee needs to contact the bank with questions about:

• Lost or stolen pay cards.
• Account balances.
• Account fees.

If employees or annuitants have questions about the payment amount, they must contact their paying agency.

Marketing the program

The bank provides pay card marketing materials that include warrant stuffers and flyers. The program is not limited to payees paid by warrant. It is available to employees and annuitants whose payments are processed through the Comptroller’s office, which excludes employees at institutions of higher education. The bank can also give presentations about the program upon request. For more information, contact the Payment Services Help Desk at (512) 936-8138 or tins.mail@cpa.texas.gov.

Agency Instructions

The following instructions apply to agencies that use the following statewide accounting and payroll systems:

• Uniform Statewide Accounting System (USAS).
• Uniform Statewide Payroll/Personnel System (USPS).
• Standardized Payroll/Personnel Reporting System (SPRS).
• Centralized Accounting and Payroll/Personnel System (CAPPS).

1. All agencies, including the state retirement systems, must:

• Provide retainable hard copies of the Fee Disclosures, English (Fee Disclosures, Spanish) to a pay card applicant prior to enrollment, in accordance with Regulation E (REG E).
• Instruct employees and annuitants to complete and return the Pay Card Enrollment Authorization (74-224) to their payroll or travel office or retirement system.
• Review the enrollment forms for legibility and completeness.
• Sign the State Agency Use Only section of the enrollment form certifying the required disclosure documents were received by the payee before enrollment.

2. Certain agencies, including the retirement systems, that require their staff obtain access to the bank’s system to process their payees’ enrollment forms must:

• Sign and submit a memorandum of understanding with the Comptroller’s office prior to requesting access to the bank’s pay card system.
• Be granted security access to the bank’s pay card system by their agency security coordinator (Comptroller user ID) (login required).
• Enter the enrollment form information directly into the bank’s pay card system.
• Use the assigned employees’ pay card account information to update their internal systems, as needed.

3. All other agencies must submit the enrollment forms to Fiscal Management’s Payment Services section by one of the following methods:

• Encrypted email to payment.services.dd@cpa.texas.gov.
• Fax to (512) 936-0052.
• U.S. mail to:
  • Texas Comptroller of Public Accounts
    Fiscal Management Division – Payment Services
    LBJ State Office Building
    111 E. 17th St.
    Austin, TX 78774

4. Payment Services:

• Enters the enrollment form information into the bank’s pay card system.
• Provides the agencies with a report that lists the payees’ assigned pay card account information. Agencies will then use the report to update their internal systems, as needed.

5. All agencies should review their daily direct deposit reports as a quality control tool to ensure the accuracy of the pay card account information and to maintain their payees’ pay card information in their internal systems, as needed.