(a) Applicability.
(1) This section covers government-wide
collection of a delinquent debt by administrative offset under 5 U.S.C.
5514 from salary payments of federal government employees other than
current Board employees.
(2) This
section does not apply where an employee consents to the recovery
of a debt from his or her federal government salary.
(b) Notice. A Federal Government
employee from whom the Board proposes to collect a debt under this
section will be provided written notice from the Board at least 30
days before any deductions begin. Such notice will state:
(1) The Board’s determination that
a debt is owed, including the origin, nature, and amount of that debt;
(2) The Board’s intention to collect
the debt by means of deduction from the employee’s disposable pay
(as defined in 5 CFR 550.1103);
(3) The frequency and amount of the intended deduction (stated as
a fixed dollar amount or as a percentage of pay), and the Board’s
intention to continue the deductions until the debt is paid in full
or otherwise resolved;
(4) An explanation
of the Board’s policy concerning interest, penalties, and administrative
costs, including a statement that such assessments must be made unless
excused in accordance with the Federal Claims Collections Standards
published in 31 CFR parts 900 through 904;
(5) The employee’s right to inspect and
copy Government records relating to the debt or, if the employee or
his or her representative cannot personally inspect the records, to
request and receive a copy of such records;
(6) If not previously provided, the opportunity
(under terms agreeable to the Board) to establish a schedule for the
voluntary repayment of the debt or to enter into a written agreement
to establish a schedule for repayment of the debt in lieu of offset;
(7) The employee’s right to a hearing
conducted by an official arranged by the Board if a petition is filed
as prescribed by the Board;
(8)
The method and time period for petitioning for a hearing, including
the contact information of the official to whom such a petition should
be sent;
(9) That the timely filing
of a petition for a hearing will stay the commencement of collection
proceedings;
(10) That a final decision
on the hearing (if one is requested) 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;
(11) That any knowingly false or frivolous
statements, representations, or evidence may subject the employee
to:
(i) Disciplinary
procedures appropriate under chapter 75 of title 5, United States
Code, part 752 of title 5, Code of Federal Regulations, or any other
applicable statutes or regulations;
(ii) Penalties under the False Claims Act, sections 3729 through
3731 of title 31, United States Code, or any other applicable statutory
authority; or
(iii) Criminal
penalties under sections 286, 287, 1001, and 1002 of title 18, United
States Code or any other applicable statutory authority.
(12) Any other rights and remedies
available to the employee under statutes or regulations governing
the program for which the collection is being made; and
(13) Unless there are applicable contractual
or statutory provisions to the contrary, that 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.
(c) Petitions for hearing.
(1) Time
to petition. A Federal Government employee from whom the Board
proposes to collect a debt under this section may request a hearing
concerning the existence or amount of the debt or the offset schedule
established by the Board by sending a written petition addressed to
the official designated in the notice described in paragraph (b) of
this section on or before the fifteenth day following receipt of such
notice. A hearing will be granted on a petition that is not filed
within such period only if the petitioner shows that the delay was
because of circumstances beyond his or her control or because of failure
to receive notice of the time limit (unless otherwise aware of it).
In all other cases of late or nonfiling of such a petition, the employee
will be deemed to have waived the right to a hearing and will be subject
to salary offset under this section.
(2) Contents of petition. The petition
must:
(i) Be signed
by the employee;
(ii) State why
the employee believes the Board’s determination concerning the existence
of amount of the debt is in error;
(iii) Fully identify and explain with reasonable specificity all
the facts, evidence and witnesses, if any, which the employee believes
support his or her position; and
(iv) Specify, if the employee desires an oral hearing, why the matter
cannot be resolved by a paper hearing, which is a determination based
upon a review of a written record, for example, because the existence
or amount of the debt depends on the hearing official’s determination
of the credibility of witnesses.
(d) Form of hearings.
(1) Hearing official. A hearing under this section will be conducted by an administrative
law judge or another individual not under the supervision or control
of the Board.
(2) Notice of hearing. After the employee requests
a hearing, the hearing official must issue a notice to the employee
and the Board of the type of hearing that will occur. If an oral hearing
will occur, the notice will state the date, time, and location of
the hearing. If a paper hearing will occur, the employee and the Board
will be notified and required to submit evidence and arguments in
writing to the hearing official by the date specified in the notice,
after which the record will be closed. The employee’s failure to appear
for an oral hearing or timely submit evidence and arguments as provided
for in the notice will be deemed a waiver of the right to a hearing
unless the hearing official determines that the failure was due to
good cause shown.
(3) Oral hearing. An employee who requests
an oral hearing under this section will be provided such a hearing
if the hearing official determines that the matter cannot be resolved
by review of documentary evidence alone because an issue of credibility
or veracity is involved. Where an oral hearing is appropriate, the
hearing need not take the form of an evidentiary hearing, as long
as both the employee and the Board are afforded a reasonable opportunity
to present their case. Oral hearings may take the form of, but are
not limited to:
(i)
Informal meetings in which the employee and Board representative are
given full opportunity to present evidence, witnesses, and argument;
(ii) Informal meetings in which
the hearing official interviews the employee and Board representative;
or
(iii) Formal written submissions
with an opportunity for oral presentation.
(4) Paper hearing. If the hearing official determines that an oral hearing is not necessary,
he or she will make the determination based upon a review of the formal
written record, including any documentation submitted by the employee
or the Board.
(5) Record. The hearing official shall maintain
a summary record of any hearing conducted under this section.
(e) Decision on hearing. Unless
the employee requests and the hearing official grants a delay in the
proceedings, at the earliest practicable date, but in any event no
later than 60 days after the filing of the petition requesting the
hearing, the hearing official will issue a written decision to the
employee. The decision will state the Board’s position concerning
the existence and amount of the debt, facts purporting to evidence
the nature and origin of the alleged debt, the hearing official’s
analysis, findings and conclusions, in light of the hearing, as
to the employee’s and/or Board’s grounds, the amount and validity
of the debt as determined by the hearing official, and the repayment
schedule, if not established by written agreement between the employee
and the Board. If the hearing official determines that a debt may
not be collected under this section, but the Board finds that the
debt is still valid, the Board may still seek collection of the debt
through other means, including but not limited to offset of other
Federal payments.
(f) Deductions
under this section. The method of collection under this section
is salary offset from disposable pay (as defined in 5 CFR 550.1103),
except as described in this paragraph. The size of installment deductions
shall ordinarily bear a reasonable relationship to the size of the
debt and the employee’s ability to pay. However, the amount deducted
for any period under this section may not exceed 15 percent of disposable
pay, unless the employee has agreed in writing to the deduction of
a greater amount or a higher deduction has been ordered by a court
under section 124 of Public Law 97-276 (97 Stat. 1195). Ordinarily,
debts must be collected in one lump sum where possible. However, if
the employee is financially unable to pay in one lump sum or the amount
of the debt exceeds 15 percent of disposable pay (or other applicable
limitation as provided in this paragraph) for an officially established
pay interval, collection must be made in installments. Such installment
deductions must be made over a period not greater than the anticipated
period of active duty or employment, as the case may be, except as
provided in paragraph (g) of this section.
(g) Separating or separated employees. If the
employee retires or resigns or if his or her employment or period
of active duty ends before collection of the debt is completed, offset
may be performed under 31 U.S.C. 3716 from subsequent payments of
any nature (e.g., final salary payment, lump-sum leave, etc.) due
the employee from the paying agency as of the date of separation to
the extent necessary to liquidate the debt. Such offset may also be
performed where appropriate against later payments of any kind due
the former employee from the United States if the debt cannot be liquidated
by offset from any final payment due the former employee as of the
date of separation. Nothing in this section shall affect any limitation
on alienation of benefits administered by the Federal Reserve System’s
Office of Employee Benefits.
(h) Non-waiver and refunds of payments. An employee’s involuntary
payment of all or any portion of a debt being collected under 5 U.S.C.
5514 must not be construed as a waiver of any rights which the employee
may have under 5 U.S.C. 5514 or any other provision of contract or
law, unless there are statutory or contractual provisions to the contrary.
Any amounts paid or deducted under this section will be promptly refunded
when a debt is waived or otherwise found not owing to the United States
(unless expressly prohibited by statute or regulation), or the employee’s
paying agency is directed by an administrative or judicial order to
refund amounts deducted from his or her current pay. Refunds do not
bear interest unless required or permitted by law or contract.
