House Bill 460 — Garnishments

Lindsay Atkinson 2020 House bill ratings Leave a Comment

Bill description: HB 460 would change Idaho’s current law regarding garnishments.

Rating: +4

Does it create, expand, or enlarge any agency, board, program, function, or activity of government? Conversely, does it eliminate or curtail the size or scope of government? 

Garnishment is a way for creditors to seek repayment of debt by garnishing wages of a debtor, through a court order. The current system of garnishment in Idaho depends on the government too much, by requiring sheriffs to serve garnishment orders on the bank or employer of the individual from whom money is being collected. HB 460 would allow the attorneys of creditors to serve garnishment orders on their own, making the use of sheriffs optional.

(+1)

Does it directly or indirectly create or increase any taxes, fees, or other assessments? Conversely, does it eliminate or reduce any taxes, fees, or other assessments? 

Making the role of sheriffs optional in the garnishment process removes certain fees that sheriffs are allowed to collect if they are brought into the process. Specifically, sheriffs are allowed to charge a fee to serve a garnishment order and to charge a fee to essentially transfer a payment between a debtor and creditor. Both fees are paid by the debtor and sheriffs offices charge between $40 to $150 just to serve the order. HB 460 will save the debtor from these excessive charges. 

(+1)

Does it give government any new, additional, or expanded power to prohibit, restrict, or regulate activities in the free market? Conversely, does it eliminate or reduce government intervention in the market? 

HB 460 does allow creditors to collect fees from debtors for serving the documents required in this section of statute, up to $20. However, creditors are not allowed to charge this fee if the documents are delivered electronically. This fee is much lower than the fee current law allows sheriffs to charge for the same service, and it is a reasonable exchange between private entities in the free market.

(+1)

HB 460 also clarifies that if a debtor has been served with multiple garnishment orders, the garnishments are paid in the order that they are served to either the debtor’s employer or financial institution. Thus, if a debtor is currently paying off one garnishment, a second garnishment will have to wait. 

As part of this clarification, this bill states that the time period before a garnishment will be returned to the court and marked as unsatisfied if no payments have been made on it is “within one hundred eighty-two (182) days of its issuance by the clerk of the court.” This effectively gives debtors more time to pay off their debt than the current standard before which a garnishment is considered returnable, which is within 90 days.

(+1)

Analyst’s Note: Our rating of this bill is not altered by any amendments made to it on 2/28. One of the significant amendments made to the bill was clarification that “If an execution is issued to the judgement creditor, he must use a serving attorney.” This means a judgement creditor cannot serve a writ of execution on their own, they have to use a serving attorney. This is still an allowance not made in current law (which requires the use of a sheriff), so it does not alter our rating.