7 CCR 1103-7-8 - [Effective 4/1/2024] Administrative Liens and Levies

8.1 The Division may issue a notice of administrative lien and levy if an employer or other Division debtor fails to pay wages, fines, or penalties determined to be due in an order that is not the subject of an order staying the enforceability of the order, that has not been superseded on appeal, or that is not subject to any order barring such action.

(A) Notice shall be provided to the Division debtor, as well as to any other known co-owner or any person or entity with possession, custody, or control of any of the assets at issue, including a financial institution as applicable.

(B) Upon an employee's written request, the Division will inform the employee within 60 calendar days whether it will issue such notice, subject to the Division's discretion to issue such notices on its own initiative at any later time.

(C) An administrative lien placed on any and all types of jointly owned or shared account(s), including multiple-party accounts as defined in C.R.S. § 15-15-201 (collectively, "joint account(s)") shall require the financial institution to freeze 100% of the assets on deposit as of the date of the notice of the administrative lien and levy.

8.2 A notice of administrative lien and levy may be opposed in whole or in part, for the reasons detailed in this Rule 8.2, and under the procedures detailed in Rule 8.3 below.

8.2.1 An exemption shall be granted for any of the following reasons:

(A) the notice contained a misidentification of the owner of some or all of the assets, and these assets are wholly owned by some person other than the employer or other Division debtor;

(B) the notice identified assets within a custodial account created pursuant to the "Colorado Uniform Transfers to Minors Act", Article 50 of Title 11, C.R.S., or a trust account of moneys held in trust for a third party;

(C) the notice would apply to assets in an amount of "disposal earnings," as defined in C.R.S. § 13-54-104(1)(a), that would exceed the maximum allowable percentage amount of "disposable earnings" that can be seized to enforce an order under C.R.S. § 13-54-104(3) based upon the documentation provided by the employer or some other Division debtor; or

(D) the notice identified assets that are exempted by law from execution, levy, attachment, garnishment, or other legal process.

8.2.2 A notice of administrative lien and levy shall be rescinded if:

(A) the Division has failed to follow the procedures in C.R.S. § 8-4-113(4) or these Rules for issuance of a notice of administrative lien and levy; and

(B) the failure either deprived a party of notice or opportunity to be heard, or otherwise had a prejudicial effect upon a party.

8.2.3 An exception may be granted to a Division debtor when the Division debtor is a natural person who is terminally ill. For purposes of this rule, "natural person" means a human, and does not include any kind of corporation, company, limited liability company, partnership, form, association, organization, agency, or any other kind of entity.

8.2.4 An appeal may be granted on the basis that there is proof that the notice would apply to assets in a joint account and some or all of those assets include up to 100% of a non-debtor account holder's net contribution of the funds on deposit, as governed by C.R.S. § 15-15-211, as of the date the person served with the notice was in receipt of the notice.

8.3 Within 21 calendar days from the date of the notice of administrative lien and levy, a Division debtor, any other person or entity claiming ownership or joint ownership of any of the asset(s), or any other person or entity with possession, custody or control any of the asset(s) (collectively, "Filer(s)"), may file any applicable opposition to the notice of administrative lien and levy for the reasons detailed in Rule 8.2 and in accordance with the procedures detailed in this Rule 8.3 and/or described in orders and instructions provided by the Division and/or published by the Division on its website.

8.3.1 The Filer has the burden, pursuant to any policies or instructions included with any notice of administrative lien and levy, of claiming with specificity, producing evidence to support, and proving entitlement to, any exceptions or exemptions, or in the case of a non-debtor joint account holder, of making such showing as to their contribution of an identifiable portion of the funds.

8.3.2 A Division hearing officer shall review the claim and document the decision whether to approve or deny the requested relief. The Division shall provide an initial decision within seven calendar days of receipt, or the next business day thereafter.

(A) An initial grant may be subject to further review by the Division, based on information from the Filer or other information obtained by the Division.

(B) An initial denial may include permission or a request to submit further information, based on which the claim for exception or exemption may be re-reviewed by the Division.

(C) An initial denial will be deemed an appealable final administrative lien and levy order (1) if the Filer chooses not to provide further information within seven calendar days, on the eighth calendar day; or (2) if the Division does not issue a new decision within seven calendar days of any new information provided by the Filer, on the eighth calendar day after the new information is provided.

8.3.3 Notice of an order on a filing opposing a notice of administrative lien and levy.

(A) If the claim is approved, in whole or in part, the decision shall indicate the scope of asset(s) released, and the extent to which a notice of administrative lien and levy may be re-issued; and the Division shall notify, and issue a release of the administrative lien and levy to:

(1) the Filer and (to the extent different) the Division debtor and any other applicable owner of any of the assets(s); and

(2) any other applicable persons or entity (including but not limited to a financial institution) with possession, custody or control of the asset(s).

(B) If the claim is denied, the Division:

(1) shall notify the Filer and (to the extent different) the employer or other Division debtor and any other applicable owner of any of the assets(s); and

(2) may, where appropriate and applicable, notify any person or entity (including, but not limited to, a financial institution) with possession, custody or control of the asset(s).

8.3.4 A hearing officer's appealable, final administrative lien and levy order pursuant to Rule 8.3.2 and 8.3.3 constitutes a final agency action pursuant to C.R.S. § 24-4-106. The Division shall promptly provide all parties with a copy of the hearing officer's decision via U.S. postal mail, electronic means, or personal delivery. The Division shall notify the parties of their appeal rights pursuant to C.R.S. § 8-4-111.5(5).

Notes

7 CCR 1103-7-8

47 CR 05, March 10, 2024, effective 4/1/2024