22 C.F.R. Subpart D—Administrative Offset
Title 22 - Foreign Relations
The provisions of this subpart apply to the collection of debts owed to the United States arising from transactions with the Peace Corps. Administrative offset is authorized under section 5 of the Federal Claims Collection Act of 1966, as amended by the Debt Collection Act of 1982 (31 U.S.C. 3716). These regulations are consistent with the Federal Claims Collection Standards on administrative offset issued jointly by the Department of Justice and the General Accounting Office as set forth in 4 CFR part 102. (a) Administrative offset, as defined in 31 U.S.C. 3701(a)(1), means withholding money payable by the United States Government to, or held by the Government for, a person to satisfy a debt the person owes the Government. (b) Person includes a natural person or persons, profit or nonprofit corporation, partnership, association, trust, estate, consortium, or other entity which is capable of owing a debt to the United States Government except that agencies of the United States, or of any State or local government shall be excluded. (a) The Director of the Peace Corps (or designee) will determine the feasibility of collection by administrative offset on a case-by-case basis for each claim established. The Director (or designee) will consider the following issues in making a determination to collect a claim by administrative offset: (1) Can administrative offset be accomplished? (2) Is administrative offset practical and legal? (3) Does administrative offset best serve and protect the interest of the U.S. Government? (4) Is administrative offset appropriate given the debtor's financial condition? (b) The Director (or designee) may initiate administrative offset with regard to debts owed by a person to another agency of the United States Government, upon receipt of a request from the head of another agency or his or her designee, and a certification that the debt exists and that the person has been afforded the necessary due process rights. (c) The Director (or designee) may request another agency that holds funds payable to a Peace Corps debtor to offset the debt against the funds held and will provide certification that: (1) The debt exists; and (2) The person has been afforded the necessary due process rights. (d) No collection by administrative offset shall be made on any debt that has been outstanding for more than 10 years unless facts material to the Government's right to collect the debt were not known, and reasonably could not have been known, by the official or officials responsible for discovering the debt. (e) Administrative offset under this subpart may not be initiated against: (1) A debt in which administrative offset of the type of debt involved is explicitly provided for or prohibited by another statute; (2) Debts owed by other agencies of the United States or by any State or local Government; or (3) Debts arising under the Internal Revenue Code of 1954; the Social Security Act; or the tariff laws of the United States. (f) The procedures for administrative offset in this subpart do not apply to the offset of Federal salaries under 5 U.S.C. 5514. (a) Whenever possible, the Peace Corps will seek written consent from the debtor to initiate immediate collection before starting the formal notification process. (b) In cases where written agreement to collect cannot be obtained from the debtor, a formal notification process shall be followed, 4 CFR 102.2. Prior to collecting a claim by administrative offset, the Peace Corps shall send to the debtor, by certified or registered mail with return receipt, written demands for payment in terms which inform the debtor of the consequences of failure to cooperate. A total of 3 progressively stronger written demands at not more than 30 day intervals will normally be made unless a response to the first or second demand indicates that a further demand would be futile or the debtor's response does not require rebuttal, or other pertinent information indicates that additional written demands would be unnecessary. In determining the timing of the demand letters, the Peace Corps should give due regard to the need to act promptly so that, as a general rule, if necessary to refer the debt to the Department of Justice for litigation, such referral can be made within 1 year of the final determination of the fact and the amount of the debt. When appropriate to protect the Government's interests (for example, to prevent the statute of limitations from expiring), written demand may be preceded by other appropriate actions, including immediate referral for litigation. (c) Before offset is made, a written notice will be sent to the debtor. This notice will include: (1) The nature and amount of the debt; (2) The date when payment is due (not less than 30 days from the date of mailing or hand delivery of the notice); (3) The agency's intention to collect the debt by administrative offset, including asking the assistance of other Federal agencies to help in the offset whenever possible, if the debtor has not made payment by the payment due date or has not made an arrangement for payment by the payment due date; (4) Any provision for interest, late payment penalties and administrative charges, if payment is not received by the due date; (5) The possible reporting of the claim to consumer reporting agencies and the possibility that Peace Corps will forward the claim to a collection agency; (6) The right of the debtor to inspect and copy Peace Corps' records related to the claim; (7) The right of the debtor to request a review of the determination of indebtedness and, in the circumstances described below, to request an oral hearing from the Peace Corps; (8) The right of the debtor to enter into a written agreement with the agency to repay the debt in some other way; and (9) In appropriate cases, the right of the debtor to request a waiver. (d) Claims for payment of travel advances and employee training expenses require notification prior to administrative offset as described in this section. Because no oral hearing is required, notice of the right to a hearing need not be included in the notification. If the debtor fails to respond to the notice described in §309.32 (c) by the proposed effective date specified in the notice, the Peace Corps may take further action under this part or the FCCS under 4 CFR parts 101 through 105. Peace Corps may collect by administrative offset if the debtor: (a) Has not made payment by the payment due date; (b) Has not requested a review of the claim within the agency as set out in §309.34; or (c) Has not made an arrangement for payment by the payment due date. (a) A debtor may dispute the existence of the debt, the amount of the debt, or the terms of repayment. A request to review a disputed debt must be submitted to the Peace Corps official who provided notification within 30 calendar days of the receipt of the written notice described in §309.32(c). (b) The Peace Corps will provide a copy of the record to the debtor and advise him/her to furnish available evidence to support his or her position. Upon receipt of the evidence, the Peace Corps will review the written record of indebtedness and inform the debtor of its findings. (c) Pending the resolution of a dispute by the debtor, transactions in any of the debtor's accounts maintained by the Peace Corps may be temporarily suspended. Depending on the type of transaction the suspension could preclude its payment, removal, or transfer, as well as prevent the payment of interest or discount due thereon. Should the dispute be resolved in the debtor's favor, the suspension will be immediately lifted. (d) During the review period, interest, penalties, and administrative costs authorized under the Federal Claims Collection Act of 1966, as amended, will continue to accrue. (a) A debtor will be provided a reasonable opportunity for an oral hearing when: (1)(i) By statute, consideration must be given to a request to waive the indebtedness; (ii) The debtor requests waiver of the indebtedness; and (iii) The waiver determination rests on an issue of creditability or veracity; or (2) The debtor requests reconsideration and the Peace Corps determines that the question of indebtedness cannot be resolved by reviewing the documentary evidence. (b) In cases where an oral hearing is provided to the debtor, the Peace Corps will conduct the hearing, and provide the debtor with a written decision. If the debtor requests a repayment agreement in place of offset, the Peace Corps has discretion and should use sound judgment to determine whether to accept a repayment agreement in place of offset. If the debt is delinquent and the debtor has not disputed its existence or amount, the Peace Corps will not accept a repayment agreement in place of offset unless the debtor is able to establish that offset would cause undue financial hardship or be unjust. No repayment arrangement will be considered unless the debtor submits a financial statement, executed under penalty of perjury, reflecting the debtor's assets, liabilities, income, and expenses. The financial statement must be submitted within 10 business days of the Peace Corps' request for the statement. At the Peace Corps' option, a confess-judgment note or bond of indemnity with surety may be required for installment agreements. Notwithstanding the provisions of this section, any reduction or compromise of a claim will be governed by 4 CFR part 103 and 31 CFR 5.3. (a) If the debtor does not exercise the right to request a review within the time specified in §309.34, or if as a result of the review, it is determined that the debt is due and no written agreement is executed, then administrative offset shall be ordered in accordance with this subpart without further notice. (b) Travel advance. The Peace Corps will deduct outstanding advances provided to Peace Corps travelers from other amounts owed the traveler by the agency whenever possible and practicable. Monies owed by an employee for outstanding travel advances which cannot be deducted from other travel amounts due that employee, will be collected through salary offset as described in subpart B of this part. (c) Volunteer allowances. The Peace Corps may deduct through administrative offset amounts owed the U.S. Government by Volunteers and Trainees from the readjustment allowance account. (1) Overseas posts will obtain written consent from Volunteers or Trainees who are indebted to the agency upon close of service or termination, to deduct amounts owed from their readjustment allowances. Posts will immediately submit the written consent to Volunteer and Staff Payroll Services Division (VSPS). (2) In cases where written consent from indebted Volunteers or Trainees cannot be obtained, overseas posts will immediately report the documented debts to VSPS. VSPS may then initiate offset against the readjustment allowance. Prior to offset action, VSPS will notify the debtor Volunteer or Trainee of their rights as required in §309.32. (d) Requests for offset to other Federal agencies. The Director or his or her designee may request that a debt owed to the Peace Corps be administratively offset against funds due and payable to a debtor by another Federal agency. In requesting administrative offset, the Peace Corps, as creditor, will certify in writing to the Federal agency holding funds of the debtor; (1) That the debtor owes the debt; (2) The amount and basis of the debt; and (3) That the Peace Corps has complied with the requirements of 31 U.S.C. 3716, its own administrative offset regulations and the applicable provisions of 4 CFR part 102 with respect to providing the debtor with due process. (e) Requests for offset from other Federal agencies. Any Federal agency may request that funds due and payable to its debtor by the Peace Corps be administratively offset in order to collect a debt owed to such Federal agency by the debtor. The Peace Corps shall initiate the requested offset only upon: (1) Receipt of written certification from the creditor agency: (i) That the debtor owes the debt; (ii) The amount and basis of the debt; (iii) That the agency has prescribed regulations for the exercise of administrative offset; and (iv) That the agency has complied with its own administrative offset regulations and with the applicable provisions of 4 CFR part 102, including providing any required hearing or review. (2) A determination by the Peace Corps that collection by offset against funds payable by the Peace Corps would be in the best interest of the United States as determined by the facts and circumstances of the particular case, and that such offset would not otherwise be contrary to law. (a) Unless otherwise prohibited by law, Peace Corps may request that monies that are due and payable to a debtor from the Civil Service Retirement and Disability Fund, the Foreign Service Retirement Fund or any other Federal retirement fund be administratively offset in reasonable amounts in order to collect in one full payment or a minimal number of payments, debts owed the United States by the debtor. Such requests shall be made to the appropriate officials of the respective fund servicing agency in accordance with such regulations as may be prescribed by the Director of that agency. The requests for administrative offset will certify in writing the following: (1) The debtor owes the United States a debt and the amount of the debt; (2) The Peace Corps has complied with applicable regulations and procedures; (3) The Peace Corps has followed the requirements of the FCCS as described in this subpart. (b) Once Peace Corps decides to request offset under paragraph (a) of this section, it will make the request as soon as practical after completion of the applicable procedures in order that the fund servicing agency may identify and flag the debtor's account in anticipation of the time when the debtor requests or becomes eligible to receive payments from the fund. This will satisfy any requirements that offset will be initiated prior to expiration of the statute of limitations. (c) If Peace Corps collects part or all of the debt by other means before deductions are made or completed pursuant to paragraph (a) of this section, Peace Corps shall act promptly to modify or terminate its request for offset. (d) This section does not require or authorize the fund servicing agency to review the merits of Peace Corps' determination relative to the debt. The Peace Corps may effect an administrative offset against a payment to be made to the debtor prior to the completion of the procedures required by §309.32(c) of this subpart if failure to take the offset would substantially jeopardize the Peace Corps' ability to collect the debt, and the time available before the payment is to be made does not reasonably permit the completion of those procedures. Such prior offset shall be promptly followed by the completion of those procedures. Amounts recovered by offset but later found not to be owed to the Peace Corps shall be promptly refunded.
Title 22: Foreign Relations
PART 309—CLAIMS COLLECTION
Subpart D—Administrative Offset
§ 309.29 Applicability and scope.
§ 309.30 Definitions.
§ 309.31 General.
§ 309.32 Demand for payment—notice.
§ 309.33 Debtor's failure to respond.
§ 309.34 Agency review.
§ 309.35 Hearing.
§ 309.36 Written agreement for repayment.
§ 309.37 Administrative offset procedures.
§ 309.38 Civil and Foreign Service Retirement Fund.
§ 309.39 Jeopardy procedure.
