Office of Debt Recovery (ODR) – Agency Program Overview

What Does This Cost My Agency?
Nothing.

For debts that become final after June 17, 2013, ODR adds a statutory collection fee to the debt balance. This fee is paid by the individual, not the referring agency.

When a collection occurs, payments are distributed between the referring agency and ODR in accordance with the Agency Participation Agreement (APA).

Payment Distribution Ratios

Debts Placed With ODR on or After January 1, 2024

Payments are applied to the new balance and distributed as follows:

• 86.956% to the referring agency
• 13.044% to ODR

Debts Placed With ODR Before January 1, 2024

Payments are applied and distributed as follows:

• 80% to the referring agency
• 20% to ODR

Why Did the Payment Distribution Ratios Change?

The payment distribution ratios changed because the statutory collection fee was reduced from 25% to 15% for debts placed with ODR beginning January 1, 2024.

How the Fee Change Affects the Split

Before January 1, 2024

• ODR assessed a 25% collection fee.
• Payments were distributed using an 80% / 20% split between the referring agency and ODR.

On or After January 1, 2024

• ODR assesses a 15% collection fee.
• Payments are applied proportionally across the total balance (principal + fee), resulting in an 86.956% / 13.044% distribution.

Why the Percentages Are Not Exactly 85% / 15%

The 86.956% / 13.044% ratio is a mathematical result, not a policy choice.

Example

• Original agency debt: $100
• 15% collection fee added: $15
• Total balance: $115

When a payment is received and applied proportionally:

• $100 ÷ $115 = 86.956% → agency share
• $15 ÷ $115 = 13.044% → ODR share

This approach ensures:

• Agencies receive 100% of their principal
• ODR recovers only the authorized 15% fee
• No portion of the agency’s debt is reduced by fee allocation

Why Older Debt Uses a Different Ratio

Debts placed before January 1, 2024, remain subject to the 25% collection fee and the 80% / 20% distribution under the APA in effect at the time of placement. This avoids retroactive changes and preserves contractual integrity.

How Do We Get Started?

To begin working with ODR, the following steps apply:

1. Execute an Agency Participation Agreement (APA) Your organization and ODR enter into one or more APAs.
2. Send a 60-Day Collection Notice You mail a notice informing the individual that the debt will be referred to ODR if payment is not made within 60 days.
3. Send a 30-Day Reminder Notice Thirty (30) days after the initial notice, you mail a reminder letter.
4. Refer the Debt to ODR Sixty (60) days after the initial notice, you transmit the debt file and required data to ODR.
5. ODR Begins Collection Activity ODR issues a placement letter to the individual and begins collection efforts.

Types of Debt Commonly Collected by ODR

Examples of state and local debt that may be referred to the Office of Debt Recovery include, but are not limited to:

• Court fines, court costs, and bond forfeitures
• Court-ordered restitution
• Damages to state property
• Driver’s license reinstatement fees
• Environmental fines and compliance penalties
• Gaming, alcohol, and tobacco enforcement penalties
• Housing authority and public housing charges
• Improperly spent grant funds
• Judgments owed to state agencies
• Past-due sewer and water bills
• Payroll overpayments to state employees
• Probation and parole supervision fees
• Professional license fines and renewal penalties
• Regulatory fines and penalties issued by state boards and commissions
• Sales and use tax penalties owed to local governments
• Traffic, parking, and speeding tickets
• Unpaid city and parish taxes
• Unpaid fees owed to universities and community colleges
• Unpaid medical bills owed to state hospitals
• Unpaid medical insurance premiums
• Vehicle insurance cancellation fines

Does ODR Allow Payment Plans?

While full payment is preferred, payment plans are sometimes necessary to ensure successful collection.

• ODR will work with individuals to establish a reasonable payment plan.
• State tax refunds will continue to be offset as long as a balance remains due, even if a payment plan is in place.
• If an individual fails to make a payment for 60 days, ODR may begin using additional collection and enforcement tools.

What Collection Tools Is ODR Allowed to Use?

Under Louisiana law, ODR is authorized to use the same collection tools available for the collection of unpaid state taxes. These tools may be used when a debt is not resolved voluntarily.

Authorized Collection Tools:

Tax Refund Offsets

If an individual is owed a Louisiana state tax refund, all or a portion of that refund may be offset to satisfy an outstanding debt.

Bank Account Levies

ODR may collect funds directly from a bank account when a debt remains unpaid, as permitted by law.

Wage Garnishments

ODR may garnish up to 25% of disposable wages until the debt is paid in full, in accordance with applicable law.

Financial Institution Data Match (FIDM)

ODR may use financial institution data to identify bank accounts held by individuals with outstanding debt and collect funds as authorized by law.

Louisiana License Suspension or Denial

Certain unpaid debts may result in the suspension or denial of a Louisiana driver’s license or other state-issued licenses, as permitted by law.

Louisiana Wildlife and Fisheries License Suspension or Denial

Certain unpaid debts may result in the suspension or denial of Louisiana hunting and fishing licenses, as permitted by law.