5 C.F.R. Subpart M—Collection of Debts
Title 5 - Administrative Personnel
Source: 50 FR 34664, Aug. 27, 1985, unless otherwise noted.
This subpart prescribes procedures to be followed by the Office of Personnel Management (OPM) , which are consistent with the Federal Claims Collection Standards (FCCS) (Chapter II of title 4, Code of Federal Regulations), in the collection of debts owed to the Civil Service Retirement and Disability Fund. This subpart covers the collection of debts due the Civil Service Retirement and Disability Fund, with the exception of the collection of court-imposed judgments, amounts referred to the Department of Justice because of fraud, and amounts collected from back pay awards in accordance with §550.805(e)(2) of this chapter. In this subpart— Additional charges means interest, penalties, and/or administrative costs owed on a debt. Annuitant means a retired employee or Member of Congress, spouse, widower, or child receiving recurring benefits under the provisions of subchapter III, chapter 83, of title 5, United States Code. Compromise is an adjustment of the total amount of the debt to be collected based upon the considerations established by the FCCS (4 CFR part 103). Consumer reporting agency has the same meaning provided in 31 U.S.C. 3701(a)(3). Debt means a payment of benefits to an individual in the absence of entitlement or in excess of the amount to which an individual is properly entitled. Delinquent has the same meaning provided in 4 CFR 101.2(b). FCCS means the Federal Claims Collection Standards (Chapter II of title 4, Code of Federal Regulations). Offset means to withhold the amount of a debt, or a portion of that amount, from one or more payments due the debtor. Offset also means the amount withheld in this manner. Reconsideration means the process of reexamining an individual's liability for a debt based on— (1) Proper application of law and regulation; and (2) Correctness of the mathematical computation. Repayment schedule means the amount of each payment and number of payments to be made to liquidate the debt as determined by OPM. Retirement fund means the Civil Service Retirement and Disability Fund. Voluntary repayment agreement means an alternative to offset that is agreed to by OPM and includes a repayment schedule. Waiver is a decision not to recover a debt under authority of 5 U.S.C. 8346(b). (a) Notice. Except as provided in §831.1305, OPM will, before starting collection, tell the debtor in writing— (1) The reason for and the amount of the debt; (2) The date on which the full payment is due; (3) OPM's policy on interest, penalties, and administrative charges; (4) If payment in full would create financial hardship to the debtor and offset is available, the types of payment(s) to be offset, the repayment schedule, the right to request an adjustment in the repayment schedule and the right to request a voluntary repayment agreement in lieu of offset; (5) The individual's right to inspect and/or receive a copy of the Government's records relating to the debt; (6) The method and time period (30 calendar days) for requesting reconsideration, waiver, and/or compromise and, in the case of offset, an adjustment to the repayment schedule; (7) The standards used by OPM for determining entitlement to waiver and compromise; (8) The right to a hearing by the Merit Systems Protection Board on a waiver request (if OPM's waiver decision finds the individual liable) in accordance with paragraph (c)(2) of this section; and (9) The fact that a timely filing of a request for reconsideration, waiver and/or compromise, or a later timely appeal of a waiver denial to the Merit Systems Protection Board, will stop collection proceedings, unless (i) failure to take the offset would substantially prejudice the Government's ability to collect the debt; and (ii) the time before the payment is to be made does not reasonably permit the completion of these procedures. (b) Requests for reconsideration, waiver, and/or compromise. (1) If a request for reconsideration, waiver and/or compromise is returned to us by mail, it must be postmarked within 30 calendar days of the date of the notice detailed in paragraph (a) of this section. If a request for reconsideration, waiver, and/or compromise is hand delivered, it must be received within 30 calendar days of the date of the notice detailed in paragraph (a) of this section. OPM may extend the 30 day time limit for filing when individuals can prove that they: (i) Were not notified of the time limit and were not otherwise aware of it; or (ii) were prevented by circumstances beyond their control from making the request within the time limit. (2) When a request for reconsideration, waiver, and/or compromise covered by this paragraph is properly filed before the death of the debtor, it will be processed to completion unless the relief sought is nullified by the debtor's death. (3) Individuals requesting reconsideration, waiver, and/or compromise will be given a full opportunity to present any pertinent information and documentation supporting their position. (4) An individual's request for waiver will be evaluated on the basis of the standards set forth in subpart N of this part. An individual's request for compromise will be evaluated on the basis of standards set forth in the FCCS (4 CFR part 103). (c) Reconsideration, waiver, and/or compromise decisions. (1) OPM's decision will be based upon the individual's written submissions, evidence of record, and other pertinent available information. (2) After consideration of all pertinent information, a written decision will be issued. The decision will state the extent of the individual's liability, and, for waiver and compromise requests, whether the debt will be waived or compromised. If the individual is determined to be liable for all or a portion of the debt, the decision will reaffirm or modify the conditions for the collection previously proposed under paragraph (a) of this section. The decision will state the individual's right to appeal to the Merit Systems Protection Board as provided by §1201.3 of this title, and, in the case of a denial of waiver, that a timely appeal will stop collection of the debt. (a) Means of collection. Collection of a debt may be made by means of offset under §831.1306, or under any statutory provision providing for offset of money due the debtor from the Federal Government, or by referral to the Justice Department for litigation, as provided in §831.1306. Referral may also be made to a collection agency under the provisions of the FCCS. (b) Additional charges. Interest, penalties, and administrative costs will be assessed on the debt in accordance with standards established in the FCCS at 4 CFR 102.13. Additional charges will be waived when required by the FCCS. In addition, such charges may be waived when OPM determines— (1) Collection would be against equity and good conscience under the standards prescribed in §§831.1403 through 831.1405 of this part; or (2) Waiver would be in the best interest of the United States. (c) Collection in installments. Whenever feasible, debts will be collected in one lump sum. However, when the debtor is financially unable to pay in one lump sum of fails to respond to a demand for full payment and off-set is available, installment payments may be effected. The amount of the installment payments will be set in accordance with the criteria in 4 CFR 102.11. (d) Commencement of collection. (1) Except as provided in paragraph (d)(2) of this section, collection will begin after the time limits for requesting further rights stated in §831.1304(a)(6) expire or OPM has issued decisions on all timely requests for those rights and the Merit Systems Protection Board has acted on any timely appeal of a waiver denial, unless: (i) Failure to make an offset would substantially prejudice the Government's ability to collect the debt; and (ii) the time before the payment is to be made does not reasonably permit the completion of the proceedings in §831.1304 or litigation. When offset begins without completion of the administrative review process, these procedures will be completed promptly, and amounts recovered by offset but later found not owed will be refunded promptly. (2) The procedures identified in §831.1304 will not be applied when the debt is caused by (i) a retroactive adjustment in the periodic rate of annuity or any deduction taken from annuity when the adjustment is a result of the annuitant's election of different entitlements under law, if the adjustment is made within 120 days of the effective date of the election; or (ii) interim, estimated payments made before the formal determination of entitlement to annuity, if the amount is recouped from the total annuity payable on the first day of the month following the last advance payment or the date the formal determination is made, whichever is later. (a) Offset from retirement payments. A debt may be collected in whole or in part from lump-sum retirement payment or recurring annuity payments. (b) Offset from other payments—(1) Administrative offset. (i) A debt may be offset from other payments due the debtor from other agencies in accordance with 4 CFR 102.3, except that offset from back pay awarded under the provisions of 5 U.S.C. 5596 (and 5 CFR 550.801 et seq.) will be made in accordance with §550.805(e)(2) of this chapter. (ii) In determining whether to collect claims by means of administrative offset after the expiration of the six year limitation provided in 5 U.S.C. 2415, the Director or his designee will determine the cost effectiveness of leaving a claim unresolved for more than 6 years. This decision will be based on such factors as the amount of the debt; the cost of collection; and the likelihood of recovering the debt. (2) Salary offset. When the debtor is an employee, or a member of the Armed Forces or a reserve component of the Armed Forces, OPM may effect collection action by offset of the debtor's pay in accordance with 5 U.S.C. 5514 and 5 CFR 550.1101 et seq. Due process described in §831.1304 will apply. The questions of fact and liability, and entitlements to waiver or compromise determined through that process are deemed correct and will not be amended under salary offset procedures. When the debtor did not receive a hearing on the amount of the offset under §831.1304 and requests such hearing, one will be conducted in accordance with subpart K of part 550 of this chapter. (a) Notice. If a debtor's response to the notice described in §831.1304(a) does not result in payment in full, payment by offset, or payment in accordance with a voluntary repayment agreement or other repayment schedule acceptable to OPM, and the debtor's rights under §831.1304 have been exhausted, OPM may report the debtor to a consumer reporting agency. In addition, a debtor's failure to make subsequent payments in accordance with a repayment schedule may result in a report to a consumer reporting agency. Before making a report to a consumer reporting agency, OPM will notify the debtor in writing that— (1) The payment is overdue; (2) OPM intends, after 60 days, to make a report as described in paragraph (b) of this section to a consumer reporting agency; (3) The debtor's right to dispute the liability has been exhausted under §831.1304; and (4) The debtor may suspend OPM action on referral by paying the debt in one lump sum or making payments current under a repayment schedule. (b) Report. When a debtor's response to the notice described in paragraph (a) of this section fails to comply with paragraph (a)(4) of this section and 60 days have elapsed since the notice was mailed, OPM may report to a consumer reporting agency that an individual is responsible for an unpaid debt and provide the following information: (1) The individual's name, address, taxpayer identification number, and any other information necessary to establish the identity of the individual; (2) The amount, status, and history of the debt; and (3) The fact that the debt arose in connection with the administration of the Civil Service Retirement System. (c) Subsequent reports. OPM will update its report to the consumer reporting agency whenever it has knowledge of events that substantially change the status or the amount of the liability. (a) OPM may refer certain debts to commercial collection agencies under the following conditions: (1) All processing required by §831.1304 has been completed before the debt is released. (2) A contract for collection services has been negotiated. (3) OPM retains the responsibility for resolving disputes, compromising claims, referring the debt for litigation, or suspending or terminating collection action. From time to time and in a manner consistent with the General Accounting Office's and the Justice Department's instructions, OPM will refer certain overpayments to the Justice Department for litigation. Referral for litigation will suspend processing under this subpart.
Title 5: Administrative Personnel
PART 831—RETIREMENT
Subpart M—Collection of Debts
§ 831.1301 Purpose.
§ 831.1302 Scope.
§ 831.1303 Definitions.
§ 831.1304 Processing.
§ 831.1305 Collection of debts.
§ 831.1306 Collection by administrative offset.
§ 831.1307 Use of consumer reporting agencies.
§ 831.1308 Referral to a collection agency.
§ 831.1309 Referral for litigation.
