Collection Procedures by Administrative Offset

29 C.F.R. Part ..., Subpart U
in effectEffective: 2024-07-01

29 C.F.R. § 102.156 Administrative offset; purpose and scope.

The regulations in this subpart specify the Agency procedures that will be followed to implement the administrative offset procedures set forth in the Debt Collection Act of 1982 (Pub. L. 97-365), 31 U.S.C. 3716.

29 C.F.R. § 102.157 Definitions.

(a) The term administrative offset means the withholding of money payable by the United States to, or held by the United States on behalf of, a person to satisfy a debt owed the United States by that person. (b) The term debtor is any person against whom the Board has a claim. (c) The term person does not include any agency of the United States, or any state or local government. (d) The terms claim and debt are synonymous and interchangeable. They refer to an amount of money or property which has been determined by an appropriate Agency official to be owed to the United States from any person, organization, or entity, except another Federal agency. (e) A debt is considered delinquent if it has not been paid by the date specified in the Agency's initial demand letter (§ 102.161), unless satisfactory payment arrangements have been made by that date, or if, at any time thereafter, the debtor fails to satisfy the debtor's obligations under a payment agreement with the Agency.

29 C.F.R. § 102.158 Agency requests for administrative offsets and cooperation with other Federal agencies.

Unless otherwise prohibited by law, the Agency may request that monies due and payable to a debtor by another Federal agency be administratively offset in order to collect debts owed the Agency by the debtor. In requesting an administrative offset, the Agency will provide the other Federal agency holding funds of the debtor with written certification stating: (a) That the debtor owes the Board a debt (including the amount of debt); and (b) That the Agency has complied with the applicable Federal Claims Collection Standards, including any hearing or review.

29 C.F.R. § 102.159 Exclusions.

(a)(1) The Agency is not authorized by the Debt Collection Act of 1982 (31 U.S.C. 3716) to use administrative offset with respect to: (i) Debts owed by any State or local government; (ii) Debts arising under or payments made under the Social Security Act, the Internal Revenue Code of 1954, or the tariff laws of the United States; or (iii) When a statute explicitly provides for or prohibits using administrative offset to collect the claim or type of claim involved. (2) No claim that has been outstanding for more than 10 years after the Board's right to collect the debt first accrued may be collected by means of administrative offset, unless facts material to the right to collect the debt were not known, and could not reasonably have been known, by the official of the Agency who was charged with the responsibility to discover and collect such debts until within 10 years of the initiation of the collection action. A determination of when the debt first accrued may be made according to existing laws regarding the accrual of debts, such as under 28 U.S.C. 2415. Unless otherwise provided by contract or law, debts or payments owed the Board which are not subject to administrative offset under 31 U.S.C. 3716 may be collected by administrative offset under the common law or other applicable statutory authority, pursuant to this paragraph (a) or Board regulations established pursuant to such other statutory authority. (b) Collection by offset against a judgment obtained by a debtor against the United State will be accomplished in accordance with 31 U.S.C. 3728.

29 C.F.R. § 102.160 Agency responsibilities.

(a) The Agency will provide appropriate written or other guidance to Agency officials in carrying out this subpart, including the issuance of guidelines and instructions. The Agency will also take such administrative steps as may be appropriate to carry out the purposes and ensure the effective implementation of this subpart. (b) Before collecting a claim by means of administrative offset, the Agency must ensure that administrative offset is feasible, allowable and appropriate, and must notify the debtor of the Agency's policies for collecting a claim by means of administrative offset. (c) Whether collection by administrative offset is feasible is a determination to be made by the Agency on a case-by-case basis, in the exercise of sound discretion. The Agency shall consider not only whether administrative offset can be accomplished, both practically and legally, but also whether administrative offset will further and protect the best interests of the United States Government. In appropriate circumstances, the Agency may give due consideration to the debtor's financial condition, and it is not expected that administrative offset will be used in every available instance, particularly where there is another readily available source of funds. The Agency may also consider whether administrative offset would substantially interfere with or defeat the purposes of the program authorizing the payments against which offset is contemplated. (d) Administrative offset must be considered by the Agency only after attempting to collect a claim under 31 U.S.C. 3711(a).

29 C.F.R. § 102.161 Notification.

(a) The Agency must send a written demand to the debtor in terms which inform the debtor of the consequences of failure to cooperate. In the demand letter, the Agency must provide the name of an Agency employee who can provide a full explanation of the claim. When the Agency deems it appropriate to protect the Government's interests (for example, to prevent the statute of limitations, 28 U.S.C. 2415, from expiring), written demand may be preceded by other appropriate actions. (b) In accordance with guidelines established by the Agency, the Agency official responsible for collection of the debt must send written notice to the debtor, informing the debtor, as appropriate, of the: (1) Nature and amount of the Board's claim; (2) Date by which payment is to be made (which normally may be not more than 30 days from the date that the initial notification was mailed or hand delivered); (3) Agency's intent to collect by administrative offset and of the debtor's rights in conjunction with such an offset; (4) Agency's intent to collect, as appropriate, interest, penalties, administrative costs and attorneys fees; (5) Rights of the debtor to a full explanation of the claim, of the opportunity to inspect and copy Agency records with respect to the claim and to dispute any information in the Agency's records concerning the claim; (6) Debtor's right to administrative appeal or review within the Agency concerning the Agency's claim and how such review must be obtained; (7) Debtor's opportunity to enter into a written agreement with the Agency to repay the debt; and (8) Date on which, or after which, an administrative offset will begin.

29 C.F.R. § 102.162 Examination and copying of records related to the claim; opportunity for full explanation of the claim.

Following receipt of the demand letter specified in § 102.161, and in conformity with Agency guidelines governing such requests, the debtor may request to examine and copy publicly available records pertaining to the debt, and may request a full explanation of the Agency's claim.

29 C.F.R. § 102.163 Opportunity for repayment.

(a) The Agency must afford the debtor the opportunity to repay the debt or enter into a repayment plan which is agreeable to the Agency and is in a written form signed by the debtor. The Agency may deem a repayment plan to be abrogated if the debtor, after the repayment plan is signed, fails to comply with the terms of the plan. (b) The Agency has discretion and may exercise sound judgment in determining whether to accept a repayment agreement in lieu of administrative offset.

29 C.F.R. § 102.164 Review of the obligation.

(a) The debtor shall have the opportunity to obtain review by the Agency of the determination concerning the existence or amount of the debt as set forth in the notice. In cases where the amount of the debt has been fully liquidated, the review is limited to ensuring that the liquidated amount is correctly represented in the notice. (b) The debtor seeking review shall make the request in writing to the Agency, not more than 15 days from the date the demand letter was received by the debtor. The request for review shall state the basis for challenging the determination. If the debtor alleges that the Agency's information relating to the debt is not accurate, timely, relevant or complete, the debtor shall provide information or documentation to support this allegation. (c) The Agency may effect an administrative offset against a payment to be made to a debtor prior to the completion of the due process procedures required by this subpart, if failure to take the offset would substantially prejudice the Agency's ability to collect the debt; for example, if the time before the payment is to be made would not reasonably permit the completion of due process procedures. Administrative offset effected prior to completion of due process procedures must be promptly followed by the completion of those procedures. Amounts recovered by administrative offset, but later found not owed to the Agency, will be promptly refunded. (d) Upon completion of the review, the Agency's reviewing official shall transmit to the debtor the Agency's decision. If appropriate, this decision shall inform the debtor of the scheduled date on or after which administrative offset will begin. The decision shall also, if appropriate, indicate any changes in information to the extent such information differs from that provided in the initial notification to the debtor under § 102.161. (e) Nothing in this subpart will preclude the Agency from sua sponte reviewing the obligation of the debtor, including reconsideration of the Agency's determination concerning the debt, and the accuracy, timeliness, relevance, and completeness of the information on which the debt is based.

29 C.F.R. § 102.165 Cost shifting.

Costs incurred by the Agency in connection with referral of debts for administrative offset will be added to the debt and thus increase the amount of the offset. Such costs may include administrative costs and attorneys fees.

29 C.F.R. § 102.166 Additional administrative collection action.

Nothing contained in this subpart is intended to preclude the Agency from utilizing any other administrative or legal remedy which may be available.

29 C.F.R. § 102.167 Prior provision of rights with respect to debt.

To the extent that the rights of the debtor in relation to the same debt have been previously provided for under some other statutory or regulatory authority, the Agency is not required to duplicate those efforts before effecting administrative offset.

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