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Standards, as well as the Department’s implementing regulations on administrative OffsetS.
(b) When another agency is owed the debt. The Department may administratively Offset money it owes to a person who is indebted to another agency if requested to do SO by that agency. Such a request must be accompanied by a Certification by the requesting agency that the person Owes the debt (including the amount and basis for the debt) and that the creditor agency has Complied with the applicable Federal Claims Collection Standards, as well as the agency implementing regulations On administrative offsets. The request from another Federal agency for Department, COOperation in the Offset should be sent, to:
Director, Office of Finance and Federal ASSistance, Room 6827, Herbert C. Hoover Building, Washington, D.C. 20230
§ 21.13 Procedures for administrative offset: single debts.
(a) Administrative offset will Commence 31 days after the date of the NOtice Of Intent, unless the debtor has requested a hearing (see $21.8) or has entered into a repayment agreement (see $21.6).
(b) When there is review of the debt, within the Department, administrative Offset will begin after the hearing offiCer’s determination has been issued under §21.11 and a copy of the determination is received by the Departmental unit’s accounting or finance of fice, except for the provision provided in $21.10(c) when immediate action is determined necessary to ensure the Department’s position in Collection of the delinquent debt.
$21.14 Procedures for administrative offset: multiple debts.
The Departmental units will follow the procedures identified in ($21.13) for the administrative offset of a single debt. However, when collecting multiple debts by administrative Offset, reSponsible Departmental officials should apply the recovered amounts to those debts in accordance with the best interests of the United States, as determined by the facts and circumstances of the particular case, paying special
attention to applicable statutes of limitations.
$21.15 Administrative offset against amounts payable from Civil Service Retirement and Disability Fund.
(a) Unless otherwise prohibited by law, the Department may request that monies which are due and payable to a debtor from the Civil Service Retirement and Disability Fund be administratively offset in reasonable amounts in Order to Collect debts owed to the United States by the debtor. Such reQuests shall be made by the Departmental unit workout officials to the appropriate Officials of the Office of Personnel Management (OPM) in acCordance with their regulations and procedures. (b) When making a request for administrative Offset under paragraph (a) Of the Section, the responsible workout group debt collection official shall include a written certification that: (1) The debtor Owes the United States a debt, including the amount and basis for the debt; (2) The Department has complied With all applicable statutes, regulations, and procedures of the Office of Personnel Management; and (3) The Department has complied With the requirements of the applicable provisions Of the Federal Claims Collection Standards and these regulations, including any required hearing Or review. (c) If a Departmental unit workout group decides to request administrative Offset under paragraph (a) of this Section, the responsible debt collection Official should make the request as Soon as practical after completion of the applicable due process procedures so the Office of Personnel Management may identify and “flag” the debtor’s account in anticipation of the time when the debtor becomes eligible and requests to receive payments from the fund. This will Satisfy any requirement that Offset be initiated prior to expiration of the applicable statute of limitations. At Such time as the debtor makes a claim for payments from the fund, and if at least a year has elapsed Since the administrative Offset request was originally made, the debtor should
be permitted to offer a satisfactory repayment plan in lieu of Offset upon establishing to the appropriate Departmental unit head (Or designee) that changed financial Circumstances would render the Offset unjust.
(d) If the Department collects part or all of the debt by other means before deductions are made or Completed under paragraph (a) of this section, the Department official responsible for collecting the debt will act promptly to modify or terminate the agency’s request for administrative offset under paragraph (a) of this Section.
(e) In accordance with procedures established by the Office of Personnel Management, the Department may request an offset from the Civil Service Retirement, and Disability Fund prior to completion of due process procedures.
§ 21.16 Collection against a judgment.
Collection by administrative Offset against a judgment obtained by a debtor against the United States shall be accomplished in accordance With 31 U.S.C. 3728.
§ 21.17 Liquidation of collateral.
If the Department holds Security Or collateral which may be liquidated through the exercise of a power of sale in the Security instrument, Or a nonjudicial foreclosure, liquidation should be accomplished by such procedures if the debtor fails to pay the debt within a reasonable time after demand Or purSuant to the contract of the parties, unless the cost of disposing of the collateral would be disproportionate to its value or Special circumstances require judicial foreclosure. The Department collection Official should provide the debtor with reasonable notice of the sale, an accounting of any Surplus proceeds, and any Other procedures required by contract or law. Collection from other sources, including liquidation of security or collateral, is not a prerequisite to requiring payment by a Surety or insurance concern unless such action is expressly required by Statute Or COntraCt.
$21.18 Collection in installments.
(a) Whenever feasible, and unless Otherwise provided by law, debts owed to
the United States, together with interest, penalties, and administrative costs should be collected in one lump sum. This is true whether the debt is being collected by administrative Offset or by another method, including voluntary payment. However, if the debtor is financially unable to pay the indebtedness in one lump sum, the responsible Departmental official(s) may accept repayment in regular installments (See $21.6). Prior to approving Such repayments, financial statements shall be required from the debtor who represents that he/she is unable to pay the debt in one lump sum. A responsible Departmental official who agrees to accept payment in regular installments should obtain a legally enforceable written agreement from the debtor which specifies all of the terms of the arrangement and which Contains a provision accelerating the debt in the event, the debtor defaults. The size and frequency of installment payments should bear a reasonable relationship to the size of the debt and the debtor’s ability to pay. If possible, the installment payments should be sufficient in size and frequency to liquidate the Government’s claim in not more than three years. Installment payments of less than $50 per month should be accepted only if justifiable on the grounds of financial hardship or for some other reasonable cause. If the debt is an unsecured claim for administrative collection, attempts should be made to obtain an executed confessjudgment note, comparable to the Department of Justice Form USA—70a, from a debtor when the total amount of the deferred installments will exceed $750. Such notes may be sought when an unsecured obligation of a lesser amount is involved. When attempting to obtain confess-judgment notes, Departmental units should provide their debtors with written explanation of the Consequences of Signing the note, and should maintain documentation Sufficient to demonstrate that the debtor has signed the note knowingly and voluntarily. Security for deferred payments Other than a COnfess-judgment note may be accepted in appropriate cases. A Departmental units head (or designee) may accept installment payments notwithstanding the refusal of a debtor to execute a confess-judgment note or to give Other Security. (b) If the debtor owes more than one debt and designates how a voluntary installment payment is to be applied as among those debts, that designation must be followed. If the debtor does not designate the application of the payment, the Department debt Collection official should apply payments to the various debts in accordance with the best interests of the United States, as determined by the facts and Circumstances of the particular Case, paying special attention to applicable statutes of limitations.
§ 21.19 Additional administrative collection action.
Nothing contained in this subpart is intended to preclude the utilization of any other administrative remedy which may be available.
PART 22—SALARY OFFSET
Sec. 22.1 22.2 22.3 22.4 22.5 22.6
Scope. DefinitionS. Pay Subject to offset. Determination of indebtedness. Notice requirements before offset. Request for hearing-prehearing SubmisSiOn(S). 22.7 Hearing procedures. 22.8 Written decision following a hearing. 22.9 Standards for determining extreme financial hardship. 22.10 Review of Departmental records related to the debt. 22.11 Coordinating offset with another Federal agency. 22.12 Procedures for Salary Offset—When deductions may begin. 22.13 Procedures for Salary offset—Types of Collection. 22.14 Procedures for Salary offset—Methods of Collection. 22.15 Procedures for salary offset—Imposition of interest, penalties, and administrative COSt.S. 22.16 Non-waiver of rights. 22.17 Refunds.
AUTHORITY: 5 U.S.C. 5514; 5 CFR 550.1104. SOURCE: 52 FR 7, Jan. 2, 1987, unless otherwiSe noted. $22.1 Scope.
(a) These regulations provide Department procedures for collection by Salalry Offset of a Federal employee's pay
to Satisfy certain debts owed the Government. (b) These regulations apply to collections by the Secretary from: (1) Federal employees who owe debts to the Department; and (2) Current employees of the Department who owe debts to other agencies. (c) These regulations do not apply to debts or claims arising under the Internal Revenue Code of 1954, as amended (26 U.S.C. 1 et Seq.); the Social Security Act (42 U.S.C. 301 et Seq.); the tariff laws of the United States; or to any case where collection of a debt by Salary offset is explicitly provided for or prohibited by another statute (e.g., travel advances in 5 U.S.C. 5705 and employee training expenses in 5 U.S.C. 4108). (d) These regulations do not apply to any adjustment to pay arising out of an employee's election of COverage or a Change in COverage under a Federal benefits program requiring periodic deductions from pay, if the amount to be recovered was accumulated Over four pay periods or less. (e) Nothing in these regulations precludes the compromise, Suspension, or termination of collection actions where appropriate.
§ 22.2 Definitions.
(a) Agency means: (1) An Executive department, military department, Government corporation, Or independent establishment as defined in 5 U.S.C. 101, 102, 103, and 104, respectively; (2) The United States Postal Service; (3) The Postal Rate Commission; (4) An agency or Court. Of the judicial branch; and (5) An agency of the legislative branch, including the U.S. Senate and the U.S. House of Representatives. (b) Creditor agency means the agency to which the debt is owed. (c) Days means calendar days. (d) Debt means: (1) An amount of money Owed the United States from Sources which include loans insured Or guaranteed by the United States; from fees, leases, rents, royalties, services, Sales of real or personal property, Overpayments, penalties, damages, fines and forfeit– ures (except those arising under the Uniform Code of Military Justice); (2) An amount Owed to the United States by an employee for pecuniary losses, including, but not limited to: (i) Theft, misuse, or loss of Government funds; (ii) False claims for services and travel; (iii) Illegal or unauthorized obligations and expenditures of Government appropriations; (iv) Authorization of the use of Government owned or leased equipment, facilities, supplies, and Services for other than official or approved purposes; (v) Vehicle accidents where the employee is determined to be liable for the repair or replacement of a Government. Owned or leased vehicle; and (vi) Erroneous entries On accounting records or reports for actions for which the employee can be held liable. (e) Department Or DOC means the United States Department Of ComIsle I’Cé. (f) Disposable pay means the amount that remains from an employee’s Federal pay after required deductions for Federal, State and local income taxes; Social Security taxes, including MediCare taxes; Federal retirement programs; premiums for basic life and health insurance benefits; and such other deductions that are required by law to be withheld. (g) Employee means: (1) A Civilian employee as defined in 5 U.S.C. 2105; (2) A member of the Armed Forces Or Reserves of the United States, or of a uniformed Service, including a CommisSioned Officer of the National Oceanic and Atmospheric Administration; (3) An employee of the United States Postal Service Or the Postal Rate Commission; (4) An employee Of an agency Or court of the judicial branch; and (5) An employee of the legislative branch, including the U.S. Senate and the U.S. House of Representatives. (h) FCCS means the Federal Claims Collection Standards jointly published by the Department of Justice and the General Accounting Office at 4 CFR 101.1 et Seq.
(i) Offset means a deduction from the disposable pay of an employee to satisfy a debt with or without the employee’s Consent. (j) Pay means basic pay, Special pay, incentive pay, retired pay, retainer pay, Or, in the case of an employee not entitled to basic pay, other authorized pay. (k) Paying agency means the agency employing the individual and authorizing his or her current pay. (1) Payroll office means the Departmental or other office providing payroll services to the employee. (m) Secretary means the Secretary of Commerce, or his/her designee.
$22.3 Pay subject to offset.
(a) An Offset from an employee’s pay may not exceed 15 percent of the employee’s disposable pay, unless the employee agrees in Writing to a larger offSet annount.
(b) An Offset from pay shall be made at the officially established pay intervals from the employee's current pay a CCOunt.
(c) If an employee retires, resigns, or is discharged, or if his or her employment period or period of active duty Otherwise ends, an offset may be made from Subsequent payment on any amount due to the individual from the Federal Government.
§ 22.4 Determination of indebtedness.
In determining that an employee is indebted, the Secretary will review the debt to make sure that it is valid and past due.
$22.5 Notice requirements before offset.
Except as provided in $22.1, deductions will not be made unless the Secretary provides the employee with a minimum Of 30 Calendar days written notice. This Notice Of Intent to offset an employee’s salary (Notice of Intent) will State:
(a) That the Secretary has reviewed the records relating to the claim and has determined that a debt is owed, the amount of the debt, and the facts giving rise to the debt;
(b) The Secretary’s intention to collect the debt by means of deduction from the employee’s current disposable
pay account until the debt and all a Ccumulated interest are paid in full; (c) The amount, frequency, approximate beginning date, and duration of the intended deductions; (d) An explanation of the Department's requirements concerning interest, penalties and administrative CostS unless such payments are excused in accordance with $22.15; (e) The employee’s right to inspect and to request and receive a copy of Department records relating to the debt; (f) The right to a hearing conducted by an administrative law judge of the Department or a hearing Official, not under the control of the Secretary, On the Secretary’s determination of the debt, the amount of the debt, or the repayment schedule (i.e., the percentage of disposable pay to be deducted each pay period), SO long as a petition is filed by the employee as prescribed by the Secretary; (g) The method and time period for requesting a hearing; (h) That the timely filing of a petition for hearing will stay the Collection proceedings; (See $22.6); (i) That a final decision. On the hearing will be issued at the earliest practical date, but not later than 60 days after the filing of the petition requesting the hearing, unless the employee requests and the hearing Official grants a delay in the proceedings; (j) Any Other rights and remedies available to the employee under Statutes or regulations governing the program for which the collection is being made; and (k) That any knowingly false or frivOlous Statements, representations, Or evidence may subject the employee to: (1) Disciplinary procedures appropriate under 5 U.S.C. 7501 et seq., 5 CFR Part 752, or any other applicable statutes or regulations; (2) Penalties under the False Claims Act, 31 U.S.C. 3729–3731, or any other applicable statutory authority; or (3) Criminal penalties under 18 U.S.C. 286, 287, 1001, and 1002 or any other applicable statutory authority. (1) Unless there are applicable contractual or statutory provisions to the Contrary, amounts paid on or deducted for the debt which are later waived or
found not owed to the United States Will be promptly refunded to the employee.
$22.6 Request for hearing-prehearing submission(s).
(a) An employee must file a petition for a hearing in accordance with the inStructions in the Notice of Intent. This petition must be filed by the time stated in the notice described in $22.5 if an employee wants a hearing concerning:
(1) The existence or annount of the debt; or
(2) The Secretary’s proposed offset Schedule.
(b) If the employee files his or her required Submissions within 5 days after the deadline date established under $22.5 and the hearing Official finds that the employee has shown good cause for failure to comply with the deadline date, the hearing official may find that an employee has not waived his Or her right to a hearing.
$22.7 Hearing procedures.
(a) The hearing will be presided over by either: (1) A Department administrative law judge; Or (2) A hearing Official not under the control of the Secretary. (b) The hearing shall conform to $102.3(c) of the Federal Claims Collection Standards (4 CFR 102.3(c)). (c)(1) If the Secretary’s determination regarding the existence or annount Of the debt is contested, the burden is On the employee to demonstrate that the Secretary’s determination was erI’OIle OllS. (2) If the hearing official finds the Secretary’s determination of the amount of the debt was erroneous, the hearing Official shall indicate the amount owed by the employee, if any. (d)(1) If the Secretary’s Offset schedule is contested, the burden is on the employee to demonstrate that the payments called for under the Secretary’s Schedule will produce an extreme financial hardship for the employee under §22.9. (2) If the hearing official finds that the payments called for under the Secretary’s offset schedule will produce an