[Title 34 CFR ]
[Code of Federal Regulations (annual edition) - July 1, 2014 Edition]
[From the U.S. Government Publishing Office]
[[Page i]]
Title 34
Education
________________________
Parts 1 to 299
Revised as of July 1, 2014
Containing a codification of documents of general
applicability and future effect
As of July 1, 2014
Published by the Office of the Federal Register
National Archives and Records Administration as a
Special Edition of the Federal Register
[[Page ii]]
U.S. GOVERNMENT OFFICIAL EDITION NOTICE
Legal Status and Use of Seals and Logos
The seal of the National Archives and Records Administration
(NARA) authenticates the Code of Federal Regulations (CFR) as
the official codification of Federal regulations established
under the Federal Register Act. Under the provisions of 44
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Federal Register, shall be judicially noticed. The CFR is
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the Federal Register (44 U.S.C. 1510).
It is prohibited to use NARA's official seal and the stylized Code
of Federal Regulations logo on any republication of this
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Any person using NARA's official seals and logos in a manner
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1017.
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[[Page iii]]
Table of Contents
Page
Explanation................................................. v
Title 34:
SUBTITLE A--Office of the Secretary, Department of
Education 3
SUBTITLE B--Regulations of the Offices of the Department
of Education
Chapter I--Office for Civil Rights, Department of
Education 319
Chapter II--Office of Elementary and Secondary
Education, Department of Education 425
Finding Aids:
Table of CFR Titles and Chapters........................ 611
Alphabetical List of Agencies Appearing in the CFR...... 631
List of CFR Sections Affected........................... 641
[[Page iv]]
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Cite this Code: CFR
To cite the regulations in
this volume use title,
part and section number.
Thus, 34 CFR 3.1 refers to
title 34, part 3, section
1.
----------------------------
[[Page v]]
EXPLANATION
The Code of Federal Regulations is a codification of the general and
permanent rules published in the Federal Register by the Executive
departments and agencies of the Federal Government. The Code is divided
into 50 titles which represent broad areas subject to Federal
regulation. Each title is divided into chapters which usually bear the
name of the issuing agency. Each chapter is further subdivided into
parts covering specific regulatory areas.
Each volume of the Code is revised at least once each calendar year
and issued on a quarterly basis approximately as follows:
Title 1 through Title 16.................................as of January 1
Title 17 through Title 27..................................as of April 1
Title 28 through Title 41...................................as of July 1
Title 42 through Title 50................................as of October 1
The appropriate revision date is printed on the cover of each
volume.
LEGAL STATUS
The contents of the Federal Register are required to be judicially
noticed (44 U.S.C. 1507). The Code of Federal Regulations is prima facie
evidence of the text of the original documents (44 U.S.C. 1510).
HOW TO USE THE CODE OF FEDERAL REGULATIONS
The Code of Federal Regulations is kept up to date by the individual
issues of the Federal Register. These two publications must be used
together to determine the latest version of any given rule.
To determine whether a Code volume has been amended since its
revision date (in this case, July 1, 2014), consult the ``List of CFR
Sections Affected (LSA),'' which is issued monthly, and the ``Cumulative
List of Parts Affected,'' which appears in the Reader Aids section of
the daily Federal Register. These two lists will identify the Federal
Register page number of the latest amendment of any given rule.
EFFECTIVE AND EXPIRATION DATES
Each volume of the Code contains amendments published in the Federal
Register since the last revision of that volume of the Code. Source
citations for the regulations are referred to by volume number and page
number of the Federal Register and date of publication. Publication
dates and effective dates are usually not the same and care must be
exercised by the user in determining the actual effective date. In
instances where the effective date is beyond the cut-off date for the
Code a note has been inserted to reflect the future effective date. In
those instances where a regulation published in the Federal Register
states a date certain for expiration, an appropriate note will be
inserted following the text.
OMB CONTROL NUMBERS
The Paperwork Reduction Act of 1980 (Pub. L. 96-511) requires
Federal agencies to display an OMB control number with their information
collection request.
[[Page vi]]
Many agencies have begun publishing numerous OMB control numbers as
amendments to existing regulations in the CFR. These OMB numbers are
placed as close as possible to the applicable recordkeeping or reporting
requirements.
PAST PROVISIONS OF THE CODE
Provisions of the Code that are no longer in force and effect as of
the revision date stated on the cover of each volume are not carried.
Code users may find the text of provisions in effect on any given date
in the past by using the appropriate List of CFR Sections Affected
(LSA). For the convenience of the reader, a ``List of CFR Sections
Affected'' is published at the end of each CFR volume. For changes to
the Code prior to the LSA listings at the end of the volume, consult
previous annual editions of the LSA. For changes to the Code prior to
2001, consult the List of CFR Sections Affected compilations, published
for 1949-1963, 1964-1972, 1973-1985, and 1986-2000.
``[RESERVED]'' TERMINOLOGY
The term ``[Reserved]'' is used as a place holder within the Code of
Federal Regulations. An agency may add regulatory information at a
``[Reserved]'' location at any time. Occasionally ``[Reserved]'' is used
editorially to indicate that a portion of the CFR was left vacant and
not accidentally dropped due to a printing or computer error.
INCORPORATION BY REFERENCE
What is incorporation by reference? Incorporation by reference was
established by statute and allows Federal agencies to meet the
requirement to publish regulations in the Federal Register by referring
to materials already published elsewhere. For an incorporation to be
valid, the Director of the Federal Register must approve it. The legal
effect of incorporation by reference is that the material is treated as
if it were published in full in the Federal Register (5 U.S.C. 552(a)).
This material, like any other properly issued regulation, has the force
of law.
What is a proper incorporation by reference? The Director of the
Federal Register will approve an incorporation by reference only when
the requirements of 1 CFR part 51 are met. Some of the elements on which
approval is based are:
(a) The incorporation will substantially reduce the volume of
material published in the Federal Register.
(b) The matter incorporated is in fact available to the extent
necessary to afford fairness and uniformity in the administrative
process.
(c) The incorporating document is drafted and submitted for
publication in accordance with 1 CFR part 51.
What if the material incorporated by reference cannot be found? If
you have any problem locating or obtaining a copy of material listed as
an approved incorporation by reference, please contact the agency that
issued the regulation containing that incorporation. If, after
contacting the agency, you find the material is not available, please
notify the Director of the Federal Register, National Archives and
Records Administration, 8601 Adelphi Road, College Park, MD 20740-6001,
or call 202-741-6010.
CFR INDEXES AND TABULAR GUIDES
A subject index to the Code of Federal Regulations is contained in a
separate volume, revised annually as of January 1, entitled CFR Index
and Finding Aids. This volume contains the Parallel Table of Authorities
and Rules. A list of CFR titles, chapters, subchapters, and parts and an
alphabetical list of agencies publishing in the CFR are also included in
this volume.
[[Page vii]]
An index to the text of ``Title 3--The President'' is carried within
that volume.
The Federal Register Index is issued monthly in cumulative form.
This index is based on a consolidation of the ``Contents'' entries in
the daily Federal Register.
A List of CFR Sections Affected (LSA) is published monthly, keyed to
the revision dates of the 50 CFR titles.
REPUBLICATION OF MATERIAL
There are no restrictions on the republication of material appearing
in the Code of Federal Regulations.
INQUIRIES
For a legal interpretation or explanation of any regulation in this
volume, contact the issuing agency. The issuing agency's name appears at
the top of odd-numbered pages.
For inquiries concerning CFR reference assistance, call 202-741-6000
or write to the Director, Office of the Federal Register, National
Archives and Records Administration, 8601 Adelphi Road, College Park, MD
20740-6001 or e-mail [email protected].
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ELECTRONIC SERVICES
The full text of the Code of Federal Regulations, the LSA (List of
CFR Sections Affected), The United States Government Manual, the Federal
Register, Public Laws, Public Papers of the Presidents of the United
States, Compilation of Presidential Documents and the Privacy Act
Compilation are available in electronic format via www.ofr.gov. For more
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The Office of the Federal Register also offers a free service on the
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site for public law numbers, Federal Register finding aids, and related
information. Connect to NARA's web site at www.archives.gov/federal-
register.
The e-CFR is a regularly updated, unofficial editorial compilation
of CFR material and Federal Register amendments, produced by the Office
of the Federal Register and the Government Printing Office. It is
available at www.ecfr.gov.
Charles A. Barth,
Director,
Office of the Federal Register.
July 1, 2014.
[[Page ix]]
THIS TITLE
Title 34--Education is composed of four volumes. The parts in these
volumes are arranged in the following order: Parts 1-299, parts 300-399,
parts 400-679, and part 680 to end. The contents of these volumes
represent all regulations codified under this title of the CFR as of
July 1, 2014.
For this volume, Michele Bugenhagen was Chief Editor. The Code of
Federal Regulations publication program is under the direction of John
Hyrum Martinez, assisted by Ann Worley.
[[Page 1]]
TITLE 34--EDUCATION
(This book contains parts 1 to 299)
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Part
SUBTITLE A--Office of the Secretary, Department of Education 3
SUBTITLE B--Regulations of the Offices of the Department of Education
chapter I--Office for Civil Rights, Department of Education. 100
chapter II--Office of Elementary and Secondary Education,
Department of Education................................... 200
[[Page 3]]
Subtitle A--Office of the Secretary, Department of Education
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Part Page
1-2
[Reserved]
3 Official seal............................... 5
4 Service of process.......................... 6
5 Availability of information to the public... 6
5b Privacy Act regulations..................... 16
6 Inventions and patents (general)............ 27
7 Employee inventions......................... 28
8 Demands for testimony or records in legal
proceedings............................. 29
12 Disposal and utilization of surplus Federal
real property for educational purposes.. 32
15 Uniform relocation assistance and real
property acquisition for Federal and
federally assisted programs............. 40
21 Equal access to justice..................... 41
30 Debt collection............................. 50
31 Salary offset for Federal employees who are
indebted to the United States under
programs administered by the Secretary
of Education............................ 60
32 Salary offset to recover overpayments of pay
or allowances from Department of
Education employees..................... 67
33 Program Fraud Civil Remedies Act............ 71
34 Administrative wage garnishment............. 88
35 Tort claims against the Government.......... 96
36 Adjustment of civil monetary penalties for
inflation............................... 99
60 Indemnification of Department of Education
employees............................... 100
73 Standards of conduct........................ 101
[[Page 4]]
74 Administration of grants and agreements with
institutions of higher education,
hospitals, and other non-profit
organizations........................... 102
75 Direct grant programs....................... 130
76 State-administered programs................. 167
77 Definitions that apply to Department
regulations............................. 199
79 Intergovernmental review of Department of
Education programs and activities....... 204
80 Uniform administrative requirements for
grants and cooperative agreements to
State and local governments............. 208
81 General Education Provisions Act--
enforcement............................. 237
82 New restrictions on lobbying................ 251
84 Governmentwide requirements for drug-free
workplace (financial assistance)........ 262
86 Drug and alcohol abuse prevention........... 268
97 Protection of human subjects................ 276
98 Student rights in research, experimental
programs, and testing................... 291
99 Family educational rights and privacy....... 293
[[Page 5]]
PARTS 1 2 [RESERVED]
PART 3_OFFICIAL SEAL--Table of Contents
Sec.
3.1 Definitions.
3.2 Description.
3.3 Authority to affix seal.
3.4 Use of the seal.
Authority: 20 U.S.C. 3472 and 3485, unless otherwise noted.
Source: 45 FR 86491, Dec. 31, 1980, unless otherwise noted.
Sec. 3.1 Definitions.
For the purposes of this part:
(a) ED means all organizational units of the Department of
Education.
(b) Embossing Seal means a display of the form and content of the
Official Seal made on a die so that the Seal can be embossed on paper or
other media.
(c) Official Seal means the original(s) of the Seal showing the
exact form, content, and colors.
(d) Replica means a copy of the Official Seal displaying the
identical form, content, and colors.
(e) Reproduction means a copy of the Official Seal displaying the
form and content, reproduced in only one color.
(f) Secretary means the Secretary of Education.
Sec. 3.2 Description.
The Official Seal of the Department of Education is described as
follows: Standing upon a mound, an oak tree with black trunk and limbs
and green foliage in front of a gold rising sun, issuing gold rays on a
light blue disc, enclosed by a dark blue border with gold edges bearing
the inscription ``DEPARTMENT OF EDUCATION'' above a star at either side
of the words ``UNITED STATES OF AMERICA'' in smaller letters in the
base; letters and stars in white. The Offical Seal of the Department is
modified when used in reproductions in black and white and when
embossed. As so modified, it appears below.
[GRAPHIC] [TIFF OMITTED] TC21OC91.062
Sec. 3.3 Authority to affix seal.
The Secretary and the Secretary's designees are authorized to affix
the Official Seal, replicas, reproductions, and embossing seals to
appropriate documents, certifications, and other material for all
purposes as authorized by this section.
(Authority: 20 U.S.C. 3474)
Sec. 3.4 Use of the seal.
(a) Use by any person or organization outside of the Department may
be made only with the Department's prior written approval.
(b) Requests by any person or organization outside of the Department
for permission to use the Seal must be made in writing to Director of
Public Affairs, U.S. Department of Education, 400 Maryland Avenue, SW.,
Washington, DC 20202, and must specify, in detail, the exact use to be
made. Any permission granted applies only to the specific use for which
it was granted and is not to be construed as permission for any other
use.
(c) In regard to internal use, replicas may be used only:
(1) For display in or adjacent to ED facilities, in Departmental
auditoriums, presentation rooms, hearing rooms, lobbies, and public
document rooms;
(2) In offices of senior officials;
(3) For official awards, certificates, medals, and plaques;
(4) For electronic media, motion picture film, video tape and other
audiovisual media prepared by or for ED and attributed thereto;
[[Page 6]]
(5) On official publications which represent the achievements or
mission of ED;
(6) In non-ED facilities in connection with events and displays
sponsored by ED, and public appearances of the Secretary or other senior
ED officials; and
(7) For other internal purposes as determined by the Director for
Management;
(d) In regard to internal use, reproductions may be used only--
(1) On ED letterhead stationery;
(2) On official ED identification cards, security, and other
approved credentials;
(3) On business cards for ED employees;
(4) On official ED signs;
(5) On official publications or graphics issued by and attributed to
ED, or joint statements of ED with one or more other Federal agencies,
State or local governments, or foreign governments;
(6) On official awards, certificates, and medals;
(7) On electronic media, motion picture film, video tape, and other
audiovisual media prepared by or for ED and attributed thereto; and
(8) For other internal purposes as determined by the Director for
Management.
(e) Embossing seals may be used only internally--
(1) On ED legal documents, including interagency or
intergovernmental agreements, agreements with State or local
governments, foreign patent applications, certification(s) of true
copies, and similar documents;
(2) On official awards and certificates; and
(3) For other purposes as determined by the General Counsel or the
Director for Management.
(f) Falsely making, forging, counterfeiting, mutilating, or altering
the Official Seal, replicas, reproductions, or embossing seals, or
knowingly using or possessing with fraudulent intent and altered
official seal, replica, reproduction or embossing seal is punishable
under 18 U.S.C. 506.
(g) Any person using the Official Seal, replicas, reproductions, or
embossing seals in a manner inconsistent with the provisions of this
part is subject to the provisions of 18 U.S.C. 1017, which states
penalties for the wrongful use of an Official Seal, and to other
provisions of law as applicable.
[45 FR 86491, Dec. 31, 1980, as amended at 53 FR 4620, Feb. 17, 1988; 56
FR 65388, Dec. 16, 1991; 65 FR 57286, Sept. 22, 2000]
PART 4_SERVICE OF PROCESS--Table of Contents
Sec. 4.1 Service of process required to be served on or delivered to
Secretary.
Summons, complaints, subpoenas, and other process which are required
to be served on or delivered to the Secretary of Education shall be
delivered to the General Counsel or a Deputy General Counsel, by mail at
400 Maryland Avenue SW., Washington, DC 20202 or by personal service at
that address. The persons above designated are authorized to accept
service of such process.
(Authority: 5 U.S.C. 301)
[47 FR 16780, Apr. 20, 1982]
PART 5_AVAILABILITY OF INFORMATION TO THE PUBLIC--Table of Contents
Subpart A_General Provisions
Sec.
5.1 Purpose.
5.2 Definitions.
Subpart B_Records Available to the Public
5.10 Public reading room.
5.11 Business information.
5.12 Creation of records not required.
5.13 Preservation of records.
Subpart C_Procedures for Requesting Access to Records and Disclosure of
Records
5.20 Requirements for making FOIA requests.
5.21 Procedure for processing FOIA requests.
Subpart D_Fees
5.30 Fees generally.
5.31 Fee definitions.
5.32 Assessment of fees.
5.33 Requirements for waiver or reduction of fees.
Subpart E_Administrative Review
5.40 Appeals of adverse determinations.
[[Page 7]]
Authority: 5 U.S.C. 552.
Source: 75 FR 33510, June 14, 2010, unless otherwise noted.
Subpart A_General Provisions
Sec. 5.1 Purpose.
This part contains the regulations that the United States Department
of Education follows in processing requests for records under the
Freedom of Information Act, as amended, 5 U.S.C. 552. These regulations
must be read in conjunction with the FOIA, including its exemptions to
disclosure, and, when appropriate, in conjunction with the Privacy Act
of 1974, as amended, 5 U.S.C. 552a, and its implementing regulations in
34 CFR part 5b.
(Authority: 5 U.S.C. 552(a), 20 U.S.C. 3474)
Sec. 5.2 Definitions.
As used in this part:
(a) Act or FOIA means the Freedom of Information Act, as amended, 5
U.S.C. 552.
(b) Department means the United States Department of Education.
(c) Component means each separate bureau, office, board, division,
commission, service, administration, or other organizational entity of
the Department.
(d) FOIA request means a written request for agency records that
reasonably describes the agency records sought, made by any person,
including a member of the public (U.S. or foreign citizen/entity),
partnership, corporation, association, and foreign or domestic
governments (excluding Federal agencies).
(e)(1) Agency records are documentary materials regardless of
physical form or characteristics that--
(i) Are either created or obtained by the Department; and
(ii) Are under the Department's control at the time it receives a
FOIA request.
(2) Agency records include--
(i) Records created, stored, and retrievable in electronic format;
(ii) Records maintained for the Department by a private entity under
a records management contract with the Federal Government; and
(iii) Documentary materials preserved by the Department as evidence
of the organization, functions, policies, decisions, procedures,
operations or other activities of the Department or because of the
informational value of data contained therein.
(3) Agency records do not include tangible, evidentiary objects or
equipment; library or museum materials made or acquired and preserved
solely for reference or exhibition purposes; extra copies of documents
preserved only for convenience of reference; stocks of publications; and
personal records created for the convenience of an individual and not
used to conduct Department business or incorporated into the
Department's record keeping system or files.
(Authority: 5 U.S.C. 552(a), 20 U.S.C. 3474)
Subpart B_Agency Records Available to the Public
Sec. 5.10 Public reading room.
(a) General. Pursuant to 5 U.S.C. 552(a)(2), the Department
maintains a public reading room containing agency records that the FOIA
requires to be made regularly available for public inspection and
copying. Published records of the Department, whether or not available
for purchase, are made available for examination. The Department's
public reading room is located at the National Library of Education, 400
Maryland Avenue, SW., Plaza Level (Level B), Washington, DC 20202-0008.
The hours of operation are 9:00 a.m. to 5:00 p.m., Monday through Friday
(except Federal holidays).
(b) Reading room records. Agency records maintained in the public
reading room include final opinions and orders in adjudications,
statements of policy and interpretations adopted by the Department and
not published in the Federal Register, administrative staff manuals and
instructions affecting the public, and copies of all agency records
regardless of form or format released to the public pursuant to a FOIA
request that the Department determines are likely to be the subject of
future FOIA requests.
(c) Electronic access. The Department makes reading room records
created on
[[Page 8]]
or after November 1, 1996, available through its electronic reading
room, located on the Department's FOIA Web site at http://www2.ed.gov/
policy/gen/leg/foia/readingroom.html.
(Authority: 5 U.S.C. 552(a), 5 U.S.C. 552(a)(2), 20 U.S.C. 3474)
Sec. 5.11 Business information.
(a) General. The Department discloses business information it
obtains from a submitter under the Act in accordance with this section.
(b) Definitions. For purposes of this section:
(1) Business information means commercial or financial information
obtained by the Department from a submitter that may be protected from
disclosure under 5 U.S.C. 552(b)(4) (Exemption 4 of the Act).
(2) Submitter means any person or entity (including corporations;
State, local, and tribal governments; and foreign governments) from whom
the Department obtains business information.
(c) Designation of business information.
(1) A submitter must use good faith efforts to designate, by
appropriate markings, either at the time of submission or at a
reasonable time thereafter, any portion of its submission that it
considers to be business information protected from disclosure under
Exemption 4 of the Act.
(2) A submitter's designations are not binding on the Department and
will expire 10 years after the date of the submission unless the
submitter requests, and provides justification for, a longer designation
period.
(3) A blanket designation on each page of a submission that all
information contained on the page is protected from disclosure under
Exemption 4 presumptively will not be considered a good faith effort.
(d) Notice to submitters. Except as provided in paragraph (g) of
this section, the Department promptly notifies a submitter whenever a
FOIA request or administrative appeal is made under the Act seeking
disclosure of the information the submitter has designated in good faith
as business information protected from disclosure under paragraph (c) of
this section, or the Department otherwise has reason to believe that it
may be required to disclose information sought to be designated by the
submitter as business information protected from disclosure under
Exemption 4 of the Act. This notice includes either a description of the
business information requested or copies of the requested agency records
or portions of agency records containing the requested business
information as well as a time period, consistent with Sec. 5.21(c),
within which the submitter can object to the disclosure pursuant to
paragraph (e) of this section.
(e) Opportunity to object to disclosure.
(1) If a submitter objects to disclosure, it must submit to the
Department a detailed written statement specifying all grounds under
Exemption 4 of the Act for denying access to the information, or a
portion of the information sought.
(2) A submitter's failure to object to the disclosure by the
deadline established by the Department in the notice provided under
paragraph (d) of this section constitutes a waiver of the submitter's
right to object to disclosure under paragraph (e) of this section.
(3) A submitter's response to a notice from the Department under
paragraph (d) of this section may itself be subject to disclosure under
the Act.
(f) Notice of intent to disclose. The Department considers a
submitter's objections and submissions made in support thereof in
deciding whether to disclose business information sought to be protected
by the submitter. Whenever the Department decides to disclose
information over a submitter's objection, the Department gives the
submitter written notice, which includes:
(1) A statement of the reasons why the submitter's objections to
disclosure were not sustained.
(2) A description of the information to be disclosed.
(3) A specified disclosure date that is a reasonable time subsequent
to the notice.
(g) Exceptions to notice requirements. The notice requirements of
paragraph (d) of this section do not apply if--
(1) The Department does not disclose the business information of the
submitter;
(2) The Department has previously lawfully published the
information;
[[Page 9]]
(3) The information has been made available to the public by the
requester or by third parties;
(4) Disclosure of the information is required by statute (other than
the Act) or regulation issued in accordance with the requirements of
Executive Order 12600 (52 FR 23781, 3 CFR, 1987 Comp., p. 235); or
(5) The designation made by the submitter under paragraph (c) of
this section appears obviously frivolous, except that, in such case, the
Department must provide the submitter with written notice of any final
administrative disclosure determination in accordance with paragraph (f)
of this section.
(h) Notice of FOIA lawsuit. Whenever a requester files a lawsuit
seeking to compel the disclosure of a submitter's business information,
the Department promptly notifies the submitter.
(i) Corresponding notice to requester. The Department notifies the
requester whenever it notifies a submitter of its opportunity to object
to disclosure, of the Department's intent to disclose requested
information designated as business information by the submitter, or of
the filing of a lawsuit.
(j) Notice of reverse FOIA lawsuit. Whenever a submitter files a
lawsuit seeking to prevent the disclosure of the submitter's
information, the Department promptly notifies the requester, and advises
the requester that its request will be held in abeyance until the
lawsuit initiated by the submitter is resolved.
(Authority: 5 U.S.C. 552(a), 20 U.S.C. 3474)
Sec. 5.12 Creation of agency records not required.
In response to a FOIA request, the Department produces only those
agency records that are not already publicly available and that are in
existence at the time it receives a request. The Department does not
create new agency records in response to a FOIA request by, for example,
extrapolating information from existing agency records, reformatting
available information, preparing new electronic programs or databases,
or creating data through calculations of ratios, proportions,
percentages, trends, frequency distributions, correlations, or
comparisons.
(Authority: 5 U.S.C. 552(a), 20 U.S.C. 3474)
Sec. 5.13 Preservation of agency records.
The Department does not destroy agency records that are the subject
of a pending FOIA request, appeal, or lawsuit.
(Authority: 5 U.S.C. 552(a), 20 U.S.C. 3474)
Subpart C_Procedures for Requesting Access to Agency Records and
Disclosure of Agency Records
Sec. 5.20 Requirements for making FOIA requests.
(a) Making a FOIA request. Any FOIA request for an agency record
must be in writing (via paper, facsimile, or electronic mail) and
transmitted to the Department as indicated on the Department's Web site.
See http://www.ed.gov/policy/gen/leg/foia/request_foia.html.
(b) Description of agency records sought. A FOIA request must
reasonably describe the agency record sought, to enable Department
personnel to locate the agency record or records with a reasonable
amount of effort. Whenever possible, a FOIA request should describe the
type of agency record requested, the subject matter of the agency
record, the date, if known, or general time period when it was created,
and the person or office that created it. Requesters who have detailed
information that would assist in identifying and locating the agency
records sought are urged to provide this information to the Department
to expedite the handling of a FOIA request.
(c) FOIA request deemed insufficient. If the Department determines
that a FOIA request does not reasonably describe the agency record or
records sought, the FOIA request will be deemed insufficient under the
Act. In that case, the Department informs the requester of the reason
the FOIA request is insufficient and, at the Department's option, either
administratively closes the FOIA request as insufficient without
determining whether to grant the FOIA request or provides the requester
an opportunity to modify the
[[Page 10]]
FOIA request to meet the requirements of this section.
(d) Verification of identity. In compliance with the Privacy Act of
1974, as amended, 5 U.S.C. 552a, FOIA requests for agency records
pertaining to the requester, a minor, or an individual who is legally
incompetent must include verification of the requester's identity
pursuant to 34 CFR 5b.5.
(Authority: 5 U.S.C. 552(a), 20 U.S.C. 3474)
Sec. 5.21 Procedures for processing FOIA requests.
(a) Acknowledgements of FOIA requests. The Department promptly
notifies the requester when it receives a FOIA request.
(b) Consultation and referrals. When the Department receives a FOIA
request for a record or records created by or otherwise received from
another agency of the Federal Government, it either responds to the FOIA
request after consultation with the other agency, or refers the FOIA
request to the other agency for processing. When the Department refers a
FOIA request to another agency for processing, the Department will so
notify the requester.
(c) Decisions on FOIA requests. The Department determines whether to
comply with a FOIA request within 20 working days after the appropriate
component of the Department first receives the request. This time period
commences on the date that the request is received by the appropriate
component of the Department, but commences no later than 10 calendar
days after the request is received by the component of the Department
designated pursuant to Sec. 5.20(a) to receive FOIA requests for agency
records. The Department's failure to comply with these time limits
constitutes exhaustion of the requester's administrative remedies for
the purposes of judicial action to compel disclosure.
(d) Requests for additional information. The Department may make one
request for additional information from the requester and toll the 20-
day period while awaiting receipt of the additional information.
(e) Extension of time period for processing a FOIA request. The
Department may extend the time period for processing a FOIA request only
in unusual circumstances, as described in paragraphs (e)(1) through
(e)(3) of this section, in which case the Department notifies the
requester of the extension in writing. A notice of extension affords the
requester the opportunity either to modify its FOIA request so that it
may be processed within the 20-day time limit, or to arrange with the
Department an alternative time period within which the FOIA request will
be processed. For the purposes of this section, unusual circumstances
include:
(1) The need to search for and collect the requested agency records
from field facilities or other establishments that are separate from the
office processing the request.
(2) The need to search for, collect, and review and process
voluminous agency records responsive to the FOIA request.
(3) The need to consult with another agency or two or more agency
components having a substantial interest in the determination on the
FOIA request.
(f) FOIA Public Liaison and FOIA Requester Service Center. The
Department's FOIA Public Liaison assists in the resolution of disputes
between the requester and the Department. The Department provides
information about the status of a FOIA request to the requester through
the Department's FOIA Requester Service Center. Contact information for
the Department's FOIA Public Liaison and FOIA Requester Service Center
may be found at http://www.ed.gov/policy/gen/leg/foia/contacts.html.
(g) Notification of determination. Once the Department makes a
determination to grant a FOIA request in whole or in part, it notifies
the requester in writing of its decision.
(h) Denials of FOIA requests.
(1) Only Departmental officers or employees delegated the authority
to deny a FOIA request may deny a FOIA request on behalf of the
Department.
(2)(i) The Department notifies the requester in writing of any
decision to deny a FOIA request in whole or in part. Denials under this
paragraph can include the following: A determination to deny access in
whole or in part to
[[Page 11]]
any agency record responsive to a request; a determination that a
requested agency record does not exist or cannot be located in the
Department's records; a determination that a requested agency record is
not readily retrievable or reproducible in the form or format sought by
the requester; a determination that what has been requested is not a
record subject to the FOIA; a determination on any disputed fee matter,
including a denial of a request for a fee waiver; and a denial of a
request for expedited processing.
(ii) All determinations denying a FOIA request in whole or in part
are signed by an officer or employee designated under paragraph (h)(1)
of this section, and include:
(A) The name and title or position of the denying officer or
employee.
(B) A brief statement of the reason or reasons for the denial,
including any exemptions applicable under the Act.
(C) An estimate of the volume of agency records or information
denied, by number of pages or other reasonable estimate (except where
the volume of agency records or information denied is apparent from
deletions made on agency records disclosed in part, or providing an
estimate would harm an interest protected by an applicable exemption
under the Act).
(D) Where an agency record has been disclosed only in part, an
indication of the exemption under the Act justifying the redaction in
the agency record (unless providing this information would harm an
interest protected by an applicable exemption under the Act).
(E) A statement of appeal rights and a list of requirements for
filing an appeal under Sec. 5.40.
(i) Timing of responses to FOIA requests.
(1) Multitrack processing.
The Department may use two or more processing tracks to distinguish
between simple and more complex FOIA requests based on one or more of
the following: the time and work necessary to process the FOIA request,
the volume of agency records responsive to the FOIA request, and whether
the FOIA request qualifies for expedited processing as described in
paragraph (i)(2) of this section.
(2) Expedited processing.
(i) The Department gives expedited treatment to FOIA requests and
appeals whenever the Department determines that a FOIA request involves
one or more of the following:
(A) A circumstance in which the lack of expedited treatment could
reasonably be expected to pose an imminent threat to the life or
physical safety of an individual.
(B) The urgent need of a person primarily engaged in disseminating
information to inform the public about an actual or alleged Federal
Government activity; or
(C) Other circumstances that the Department determines demonstrate a
compelling need for expedited processing.
(ii) A requester may ask for expedited processing at the time of the
initial FOIA request or at any time thereafter.
(iii) A request for expedited processing must contain a detailed
explanation of the basis for the request, and must be accompanied by a
statement certifying the truth of the circumstances alleged or other
evidence of the requester's compelling need acceptable to the
Department.
(iv) The Department makes a determination whether to grant or deny a
request for expedited processing within 10 calendar days of its receipt
by the component of the Department designated pursuant to Sec. 5.20(a)
to receive FOIA requests for agency records, and processes FOIA requests
accepted for expedited processing as soon as practicable and on a
priority basis.
(Authority: 5 U.S.C. 552(a), 20 U.S.C. 3474)
Subpart D_Fees
Sec. 5.30 Fees generally.
The Department assesses fees for processing FOIA requests in
accordance with Sec. 5.32(a), except where fees are limited under Sec.
5.32(b) or where a waiver or reduction of fees is granted under Sec.
5.33. Requesters must pay fees by check or money order made payable to
the U.S. Department of Education, and must include the FOIA request
number on the check or money order.
[[Page 12]]
The Department retains full discretion to limit or adjust fees.
(Authority: 5 U.S.C. 552(a), 5 U.S.C. 552(a)(4)(A), 20 U.S.C. 3474)
Sec. 5.31 Fee definitions.
(a) Commercial use request means a request from or on behalf of a
FOIA requester seeking information for a use or purpose that furthers
the requester's commercial, trade, or profit interests, which can
include furthering those interests through litigation. For the purpose
of assessing fees under the Act, the Department determines, whenever
reasonably possible, the use to which a requester will put the requested
agency records.
(b) Direct costs mean those expenses that an agency actually incurs
in searching for and duplicating (and, in the case of commercial use
FOIA requests, reviewing) agency records to respond to a FOIA request.
Direct costs include, for example, the pro rata salary of the
employee(s) performing the work (i.e., basic rate of pay plus 16
percent) and the cost of operating duplication machinery. The
Department's other overhead expenses are not included in direct costs.
(c) Duplication means making a copy of the agency record, or of the
information in it, as necessary to respond to a FOIA request. Copies can
be made in several forms and formats, including paper and electronic
records. The Department honors a requester's specified preference as to
form or format of disclosure, provided that the agency record is readily
reproducible with reasonable effort in the requested form or format.
(d) Educational institution means a preschool, a public or private
elementary or secondary school, an institution of undergraduate higher
education, an institution of graduate higher education, an institution
of professional education, or an institution of vocational education,
that operates a program of scholarly research. To qualify as an
educational institution under this part, a requester must demonstrate
that an educational institution authorized the request and that the
agency records are not sought for individual or commercial use, but are
instead sought to further scholarly research. A request for agency
records for the purpose of affecting a requester's application for, or
prospect of obtaining, new or additional grants, contracts, or similar
funding is presumptively a commercial use request.
(e) Noncommercial scientific institution means an institution that
is operated solely for the purpose of conducting scientific research,
the results of which are not intended to promote any particular product
or industry. A noncommercial scientific institution does not operate for
a ``commercial use'', as the term is defined in paragraph (a) of this
section. To qualify as a noncommercial scientific institution under this
part, a requester must demonstrate that a noncommercial scientific
institution authorized the request and that the agency records are
sought to further scientific research and not for a commercial use. A
request for agency records for the purpose of affecting a requester's
application for, or prospect of obtaining, new or additional grants,
contracts, or similar funding is presumptively a commercial use request.
(f) Representative of the news media, or news media requester, means
any person or entity that gathers information of potential interest to a
segment of the public, uses its editorial skills to turn the raw
materials into a distinct work, and distributes that work to an
audience. For the purposes of this section, the term ``news'' means
information about current events or information that would be of current
interest to the public. Examples of news media entities include
television or radio stations broadcasting to the public at large and
publishers of periodicals that qualify as disseminators of news and make
their products available for purchase by, subscription by, or free
distribution to the general public. To be regarded as a representative
of the news media, a ``freelance'' journalist must demonstrate a solid
basis for expecting publication, such as a publication contract or a
past publication record. For inclusion in this category, a requester
must not be seeking the requested agency records for a commercial use.
(g) Review means the examination of an agency record located in
response to a FOIA request to determine whether
[[Page 13]]
any portion of the record is exempt from disclosure under the Act.
Reviewing the record includes processing the agency record for
disclosure and making redactions and other preparations for disclosure.
Review costs are recoverable even if an agency record ultimately is not
disclosed. Review time includes time spent considering any formal
objection to disclosure but does not include time spent resolving
general legal or policy issues regarding the application of exemptions
under the Act.
(h) Search means the process of looking for and retrieving agency
records or information responsive to a FOIA request. Searching includes
page-by-page or line-by-line identification of information within agency
records and reasonable efforts to locate and retrieve information from
agency records maintained in electronic form or format, provided that
such efforts do not significantly interfere with the operation of the
Department's automated information systems.
(Authority: 5 U.S.C. 552(a), 5 U.S.C. 552(a)(4)(A), 20 U.S.C. 3474)
Sec. 5.32 Assessment of fees.
(a) Fees. In responding to FOIA requests, the Department charges the
following fees (in accordance with the Office of Management and Budget's
``Uniform FOIA Fee Schedule and Guidelines,'' 52 FR 10012 (March 27,
1987)), unless it has granted a waiver or reduction of fees under Sec.
5.33 and subject to the limitations set forth in paragraph (b) of this
section:
(1) Search. The Department charges search fees, subject to the
limitations of paragraph (b) of this section. Search time includes time
spent searching, regardless of whether the search results in the
location of responsive agency records and, if so, whether such agency
records are released to the requester under the Act. The requester will
be charged the direct costs, as defined in Sec. 5.31(b), of the search.
In the case of computer searches for agency records, the Department
charges the requester for the direct cost of conducting the search,
subject to the limitations set forth in paragraph (b) of this section.
(2) Review. (i) The Department charges fees for initial agency
record review at the same rate as for searches, subject to the
limitations set forth in paragraph (b) of this section.
(ii) No fees are charged for review at the administrative appeal
level except in connection with--
(A) The review of agency records other than agency records
identified as responsive to the FOIA request in the initial decision;
and
(B) The Department's decision regarding whether to assert that an
exemption exists under the Act that was not cited in the decision on the
initial FOIA request.
(iii) Review fees are not assessed for FOIA requests other than
those made for a ``commercial use,'' as the term is defined in Sec.
5.31(a).
(3) Duplication. The Department charges duplication fees at the rate
of $0.20 per page for paper photocopies of agency records, $3.00 per CD
for documents recorded on CD, and at the direct cost for duplication for
electronic copies and other forms of duplication, subject to the
limitations of paragraph (b) of this section.
(b) Limitations on fees.
(1) Fees are limited to charges for document duplication when agency
records are not sought for commercial use and the request is made by--
(i) An educational or noncommercial scientific institution, whose
purpose is scholarly or scientific research; or
(ii) A representative of the news media.
(2) For FOIA requests other than commercial use FOIA requests, the
Department provides the first 100 pages of agency records released (or
the cost equivalent) and the first two hours of search (or the cost
equivalent) without charge, pursuant to 5 U.S.C. 552(a)(4)(A)(iv)(II).
(3) Whenever the Department calculates that the fees assessable for
a FOIA request under paragraph (a) of this section total $25.00 or less,
the Department processes the FOIA request without charge to the
requester.
(c) Notice of anticipated fees in excess of $25. When the Department
estimates or determines that the fees for processing a FOIA request will
total more than $25 and the requester has not stated a willingness to
pay such fees, the Department notifies the requester of
[[Page 14]]
the anticipated amount of fees before processing the FOIA request. If
the Department can readily anticipate fees for processing only a portion
of a request, the Department advises the requester that the anticipated
fee is for processing only a portion of the request. When the Department
has notified a requester of anticipated fees greater than $25, the
Department does not further process the request until the requester
agrees in writing to pay the anticipated total fee.
(d) Charges for other services. When the Department chooses as a
matter of administrative discretion to provide a special service, such
as certification of agency records, it charges the requester the direct
cost of providing the service.
(e) Charging interest. The Department charges interest on any unpaid
bill assessed at the rate provided in 31 U.S.C. 3717. In charging
interest, the Department follows the provisions of the Debt Collection
Act of 1982, as amended (Pub. L. 97-365), and its administrative
procedures, including the use of consumer reporting agencies, collection
agencies, and offset.
(f) Aggregating FOIA requests. When the Department reasonably
believes that a requester, or a group of requesters acting together, is
attempting to divide a FOIA request into a series of FOIA requests for
the purpose of avoiding or reducing otherwise applicable fees, the
Department may aggregate such FOIA requests for the purpose of assessing
fees. The Department does not aggregate multiple FOIA requests involving
unrelated matters.
(g) Advance payments.
(1) For FOIA requests other than those described in paragraphs
(g)(2) and (g)(3) of this section, the Department does not require the
requester to pay fees in advance.
(2) Where the Department estimates or determines that fees for
processing a FOIA request will total more than $250, it may require the
requester to pay the fees in advance, except where the Department
receives a satisfactory assurance of full payment from a requester with
a history of prompt payment of FOIA fees.
(3) The Department may require a requester who has previously failed
to pay a properly assessed FOIA fee within 30 calendar days of the
billing date to pay in advance the full amount of estimated or actual
fees before it further processes a new or pending FOIA request from that
requester.
(4) When the Department requires advance payment of estimated or
assessed fees, it does not consider the FOIA request received and does
not further process the FOIA request until payment is received.
(h) Tolling. When necessary for the Department to clarify issues
regarding fee assessment with the FOIA requester, the time limit for
responding to the FOIA request is tolled until the Department resolves
such issues with the requester.
(i) Other statutory requirements. The fee schedule of this section
does not apply to fees charged under any statute that specifically
requires an agency to set and collect fees for producing particular
types of agency records.
(Authority: 5 U.S.C. 552(a), 5 U.S.C. 552(a)(4)(A), 20 U.S.C. 3474)
Sec. 5.33 Requirements for waiver or reduction of fees.
(a) The Department processes a FOIA request for agency records
without charge or at a charge less than that established under Sec.
5.32(a) when the Department determines that--
(1) Disclosure of the requested information is in the public
interest because it is likely to contribute significantly to public
understanding of the operations or activities of the government; and
(2) Disclosure of the information is not primarily in the commercial
interest of the requester.
(b) To determine whether a FOIA request is eligible for waiver or
reduction of fees pursuant to paragraph (a)(1) of this section, the
Department considers the following factors:
(1) Whether the subject of the request specifically concerns
identifiable operations or activities of the government.
(2) Whether the disclosable portions of the requested information
will be meaningfully informative in relation to the subject matter of
the request.
(3) The disclosure's contribution to public understanding of
government operations, i.e., the understanding of
[[Page 15]]
the public at large, as opposed to an individual or a narrow segment of
interested persons (including whether the requester has expertise in the
subject area of the FOIA request as well as the intention and
demonstrated ability to disseminate the information to the public).
(4) The significance of the disclosure's contribution to public
understanding of government operations or activities, i.e., the public's
understanding of the subject matter existing prior to the disclosure
must be likely to be enhanced significantly by the disclosure.
(c) To determine whether a FOIA request is eligible for waiver or
reduction of fees pursuant to paragraph (a)(2) of this section, the
Department considers the following factors:
(1) The existence of the requester's commercial interest, i.e.,
whether the requester has a commercial interest that would be furthered
by the requested disclosure.
(2) If a commercial interest is identified, whether the commercial
interest of the requester is sufficiently large in comparison with the
public interest in disclosure, that disclosure is primarily in the
commercial interest of the requester.
(d) When the fee waiver requirements are met only with respect to a
portion of a FOIA request, the Department waives or reduces fees only
for that portion of the request.
(e) A requester seeking a waiver or reduction of fees must submit
evidence demonstrating that the FOIA request meets all the criteria
listed in paragraphs (a) through (c) of this section.
(f) A requester must seek a fee waiver for each FOIA request for
which a waiver is sought. The Department does not grant standing fee
waivers but considers each fee waiver request independently on its
merits.
(Authority: 5 U.S.C. 552(a), 5 U.S.C. 552(a)(4)(A), 20 U.S.C. 3474)
Subpart E_Administrative Review
Sec. 5.40 Appeals of adverse determinations.
(a) In general. A requester may seek an administrative review of an
adverse determination on the FOIA request made by the requester by
submitting an appeal of the determination to the Department. Adverse
determinations include denials of access to agency records, in whole or
in part; ``no agency records'' responses; and adverse fee decisions,
including denials of requests for fee waivers, and all aspects of fee
assessments.
(b) Appeal requirements. A requester must submit an appeal within 35
calendar days of the date on the adverse determination letter issued by
the Department or, where the requester has received no determination, at
any time after the due date for such determination. An appeal must be in
writing and must include a detailed statement of all legal and factual
bases for the appeal. The requester's failure to comply with time limits
set forth in this section constitutes exhaustion of the requester's
administrative remedies for the purposes of initiating judicial action
to compel disclosure.
(c) Determination on appeal. (1) The Department makes a written
determination on an administrative appeal within 20 working days after
receiving the appeal. The time limit may be extended in accordance with
Sec. 5.21(c) through (e). The Department's failure to comply with time
limits set forth in this section constitutes exhaustion of the
requester's administrative remedies for the purposes of initiating
judicial action to compel disclosure.
(2) The Department's determination on an appeal constitutes the
Department's final action on the FOIA request. Any Department
determination denying an appeal in whole or in part includes the reasons
for the denial, including any exemptions asserted under the Act, and
notice of the requester's right to seek judicial review of the
determination in accordance with 5 U.S.C. 552(a)(4). Where the
Department makes a determination to grant an appeal in whole or in part,
it processes the FOIA request subject to the appeal in accordance with
the determination on appeal.
(Authority: 5 U.S.C. 552(a), 5 U.S.C. 552(a)(6), 20 U.S.C. 3474)
[[Page 16]]
PART 5b_PRIVACY ACT REGULATIONS--Table of Contents
Sec.
5b.1 Definitions.
5b.2 Purpose and scope.
5b.3 Policy.
5b.4 Maintenance of records.
5b.5 Notification of or access to records.
5b.7 Procedures for correction or amendment of records.
5b.8 Appeals of refusals to correct or amend records.
5b.9 Disclosure of records.
5b.10 Parents and guardians.
5b.11 Exempt systems.
5b.12 Contractors.
5b.13 Fees.
Appendix A to Part 5b--Employee Standards of Conduct
Appendix B to Part 5b--Routine Uses Applicable to More Than One System
of Records Maintained by ED
Authority: 5 U.S.C. 301, 5 U.S.C. 552a.
Source: 45 FR 30808, May 9, 1980, unless otherwise noted.
Sec. 5b.1 Definitions.
As used in this part:
(a) Access means availability of a record to a subject individual.
(b) Agency means the Department of Education.
(c) Department means the Department of Education.
(d) Disclosure means the availability or release of a record to
anyone other than the subject individual.
(e) Individual means a living person who is a citizen of the United
States or an alien lawfully admitted for permanent residence. It does
not include persons such as sole proprietorships, partnerships, or
corporations. A business firm which is identified by the name of one or
more persons is not an individual within the meaning of this part.
(f) Maintain means to maintain, collect, use, or disseminate when
used in connection with the term ``record''; and, to have control over
or responsibility for a system of records when used in connection with
the term ``system of records.''
(g) Notification means communication to an individual whether he is
a subject individual.
(h) Record means any item, collection, or grouping of information
about an individual that is maintained by the Department, including but
not limited to the individual's education, financial transactions,
medical history, and criminal or employment history and that contains
his name, or an identifying number, symbol, or other identifying
particular assigned to the individual, such as a finger or voice print
or a photograph. When used in this part, record means only a record
which is in a system of records.
(i) Responsible Department official means that officer who is listed
in a notice of a system of records as the system manager for a given
system of records or another individual listed in the notice of a system
of records to whom requests may be made, or the designee of either such
officer or individual.
(j) Routine use means the disclosure of a record outside the
Department, without the consent of the subject individual, for a purpose
which is compatible with the purpose for which the record was collected.
It includes disclosures required to be made by statute other than the
Freedom of Information Act, 5 U.S.C. 552. It does not include
disclosures which are permitted to be made without the consent of the
subject individual which are not compatible with the purpose for which
it was collected such as disclosures to the Bureau of the Census, the
General Accounting Office, or to Congress.
(k) Secretary means the Secretary of Education.
(l) Statistical record means a record maintained for statistical
research or reporting purposes only and not maintained to make
determinations about a particular subject individual.
(m) Subject individual means that individual to whom a record
pertains.
(n) System of records means any group of records under the control
of the Department from which a record is retrieved by personal
identifier such as the name of the individual, number, symbol or other
unique retriever assigned to the individual. Single records or groups of
records which are not retrieved by a personal identifier are not part of
a system of records. Papers maintained by individual employees of the
Department which are prepared, maintained, or discarded at the
discretion of the employee and which are not
[[Page 17]]
subject to the Federal Records Act, 44 U.S.C. 2901, are not part of a
system of records; Provided, That such personal papers are not used by
the employee or the Department to determine any rights, benefits, or
privileges of individuals.
[45 FR 30808, May 9, 1980; 45 FR 37426, June 3, 1980]
Sec. 5b.2 Purpose and scope.
(a) This part implements section 3 of the Privacy Act of 1974, 5
U.S.C. 552a (hereinafter referred to as the Act), by establishing agency
policies and procedures for the maintenance of records. This part also
establishes agency policies and procedures under which a subject
individual may be given notification of or access to a record pertaining
to him and policies and procedures under which a subject individual may
have his record corrected or amended if he believes that his record is
not accurate, timely, complete, or relevant or necessary to accomplish a
Department function.
(b) All components of the Department are governed by the provisions
of this part. Also governed by the provisions of this part are advisory
committees and councils within the meaning of the Federal Advisory
Committee Act which provide advice to (1) any official or component of
the Department or (2) the President and for which the Department has
been delegated responsibility for providing services.
(c) Employees of the Department governed by this part include all
regular and special government employees of the Department; experts and
consultants whose temporary (not in excess of 1 year) or intermittent
services have been procured by the Department by contract pursuant to
3109 of title 5, United States Code; volunteers where acceptance of
their services are authorized by law; those individuals performing
gratuitous services as permitted under conditions prescribed by the
Office of Personnel Management; and, participants in work-study or
training programs.
(d) This part does not:
(1) Make available to a subject individual records which are not
retrieved by that individual's name or other personal identifier.
(2) Make available to the general public records which are retrieved
by a subject individual's name or other personal identifier or make
available to the general public records which would otherwise not be
available to the general public under the Freedom of Information Act, 5
U.S.C. 552, and part 5 of this title.
(3) Govern the maintenance or disclosure of, notification of or
access to, records in the possession of the Department which are subject
to regulations of another agency, such as personnel records subject to
the regulations of the Office of Personnel Management.
(4) Apply to grantees, including State and local governments or
subdivisions thereof, administering federally funded programs.
(5) Make available records compiled by the Department in reasonable
anticipation of court litigation or formal administrative proceedings.
The availability of such records to the general public or to any subject
individual or party to such litigation or proceedings shall be governed
by applicable constitutional principles, rules of discovery, and
applicable regulations of the Department.
Sec. 5b.3 Policy.
It is the policy of the Department to protect the privacy of
individuals to the fullest extent possible while nonetheless permitting
the exchange of records required to fulfill the administrative and
program responsibilities of the Department, and responsibilities of the
Department for disclosing records which the general public is entitled
to have under the Freedom of Information Act, 5 U.S.C. 552, and part 5
of this title.
Sec. 5b.4 Maintenance of records.
(a) No record will be maintained by the Department unless:
(1) It is relevant and necessary to accomplish a Department function
required to be accomplished by statute or Executive Order;
(2) It is acquired to the greatest extent practicable from the
subject individual when maintenance of the record may result in a
determination about the subject individual's rights, benefits or
privileges under Federal programs;
[[Page 18]]
(3) The individual providing the record is informed of the authority
for providing the record (including whether the providing of the record
is mandatory or voluntary, the principal purpose for maintaining the
record, the routine uses for the record, what effect his refusal to
provide the record may have on him), and if the record is not required
by statute or Executive Order to be provided by the individual, he
agrees to provide the record.
(b) No record will be maintained by the Department which describes
how an individual exercises rights guaranteed by the First Amendment
unless expressly authorized (1) by statute, or (2) by the subject
individual, or (3) unless pertinent to and within the scope of an
authorized law enforcement activity.
Sec. 5b.5 Notification of or access to records.
(a) Times, places, and manner of requesting notification of or
access to a record. (1) Any individual may request notification of a
record. He may at the same time request access to any record pertaining
to him. An individual may be accompanied by another individual of his
choice when he requests access to a record in person; Provided, That he
affirmatively authorizes the presence of such other individual during
any discussion of a record to which access is requested.
(2) An individual making a request for notification of or access to
a record shall address his request to the responsible Department
official and shall verify his identity when required in accordance with
paragraph (b)(2) of this section. At the time the request is made, the
individual shall specify which systems of records he wishes to have
searched and the records to which he wishes to have access. He may also
request that copies be made of all or any such records. An individual
shall also provide the responsible Department official with sufficient
particulars to enable such official to distinguish between records on
subject individuals with the same name. The necessary particulars are
set forth in the notices of systems of records.
(3) An individual who makes a request in person may leave with any
responsible Department official a request for notification of or access
to a record under the control of another responsible Department
official; Provided, That the request is addressed in writing to the
appropriate responsible Department official.
(b) Verification of identity--(1) When required. Unless an
individual, who is making a request for notification of or access to a
record in person, is personally known to the responsible Department
official, he shall be required to verify his identity in accordance with
paragraph (b)(2) of this section if:
(i) He makes a request for notification of a record and the
responsible Department official determines that the mere disclosure of
the existence of the record would be a clearly unwarranted invasion of
privacy if disclosed to someone other than the subject individual; or,
(ii) He makes a request for access to a record which is not required
to be disclosed to the general public under the Freedom of Information
Act, 5 U.S.C. 552, and part 5 of this title.
(2) Manner of verifying identity. (i) An individual who makes a
request in person shall provide to the responsible Department official
at least one piece of tangible identification such as a driver's
license, passport, alien or voter registration card, or union card to
verify his identity. If an individual does not have identification
papers to verify his identity, he shall certify in writing that he is
the individual who he claims to be and that he understands that the
knowing and willful request for or acquisition of a record pertaining to
an individual under false pretenses is a criminal offense under the Act
subject to a $5,000 fine.
(ii) Except as provided in paragraph (b)(2)(v) of this section, an
individual who does not make a request in person shall submit a
notarized request to the responsible Department official to verify his
identity or shall certify in his request that he is the individual who
he claims to be and that he understands that the knowing and willful
request for or acquisition of a record pertaining to an individual under
false pretenses is a criminal offense under the Act subject to a $5,000
fine.
[[Page 19]]
(iii) An individual who makes a request on behalf of a minor or
legal incompetent as authorized under Sec. 5b.10 of this part shall
verify his relationship to the minor or legal incompetent, in addition
to verifying his own identity, by providing a copy of the minor's birth
certificate, a court order, or other competent evidence of guardianship
to the responsible Department official; except that, an individual is
not required to verify his relationship to the minor or legal
incompetent when he is not required to verify his own identity or when
evidence of his relationship to the minor or legal incompetent has been
previously given to the responsible Department official.
(iv) An individual shall further verify his identity if he is
requesting notification of or access to sensitive records. Any further
verification shall parallel the record to which notification or access
is being sought. Such further verification may include such particulars
as the individual's years of attendance at a particular educational
institution, rank attained in the uniformed services, date or place of
birth, names of parents, or an occupation.
(v) An individual who makes a request by telephone shall verify his
identity by providing to the responsible Department official identifying
particulars which parallel the record to which notification or access is
being sought. If the responsible Department official determines that the
particulars provided by telephone are insufficient, the requester will
be required to submit the request in writing or in person. Telephone
requests will not be accepted where an individual is requesting
notification of or access to sensitive records.
(c) Granting notification of or access to a record. (1) Subject to
the provisions governing exempt systems in Sec. 5b.11 of this part, a
responsible Department official, who receives a request for notification
of or access to a record and, if required, verification of an
individual's identity, will review the request and grant notification or
access to a record, if the individual requesting access to the record is
the subject individual.
(2) If the responsible Department official determines that there
will be a delay in responding to a request because of the number of
requests being processed, a breakdown of equipment, shortage of
personnel, storage of records in other locations, etc., he will so
inform the individual and indicate when notification or access will be
granted.
(3) Prior to granting notification of or access to a record, the
responsible Department official may at his discretion require an
individual making a request in person to reduce his request to writing
if the individual has not already done so at the time the request is
made.
Sec. 5b.7 Procedures for correction or amendment of records.
(a) Any subject individual may request that his record be corrected
or amended if he believes that the record is not accurate, timely,
complete, or relevant or necessary to accomplish a Department function.
A subject individual making a request to amend or correct his record
shall address his request to the responsible Department official in
writing; except that, the request need not be in writing if the subject
individual makes his request in person and the responsible Department
official corrects or amends the record at that time. The subject
individual shall specify in each request:
(1) The system of records from which the record is retrieved;
(2) The particular record which he is seeking to correct or amend;
(3) Whether he is seeking an addition to or a deletion or
substitution of the record; and,
(4) His reasons for requesting correction or amendment of the
record.
(b) A request for correction or amendment of a record will be
acknowledged within 10 working days of its receipt unless the request
can be processed and the subject individual informed of the responsible
Department official's decision on the request within that 10 day period.
(c) If the responsible Department official agrees that the record is
not accurate, timely, or complete based on a preponderance of the
evidence, the record will be corrected or amended. The record will be
deleted without regard to its accuracy, if the record is
[[Page 20]]
not relevant or necessary to accomplish the Department function for
which the record was provided or is maintained. In either case, the
subject individual will be informed in writing of the correction,
amendment, or deletion and, if accounting was made of prior disclosures
of the record, all previous recipients of the record will be informed of
the corrective action taken.
(d) If the responsible Department official does not agree that the
record should be corrected or amended, the subject individual will be
informed in writing of the refusal to correct or amend the record. He
will also be informed that he may appeal the refusal to correct or amend
his record Sec. 5b.8 of this part.
(e) Requests to correct or amend a record governed by the regulation
of another government agency, e.g., Office of Personnel Management,
Federal Bureau of Investigation, will be forwarded to such government
agency for processing and the subject individual will be informed in
writing of the referral.
Sec. 5b.8 Appeals of refusals to correct or amend records.
(a) Processing the appeal. (1) A subject individual who disagrees
with a refusal to correct or amend his record may appeal the refusal in
writing. All appeals shall be made to the Secretary.
(2) An appeal will be completed within 30 working days from its
receipt by the appeal authority; except that, the appeal authority may
for good cause extend this period for an additional 30 days. Should the
appeal period be extended, the subject individual appealing the refusal
to correct or amend the record will be informed in writing of the
extension and the circumstances of the delay. The subject individual's
request to amend or correct the record, the responsible Department
official's refusal to correct or amend, and any other pertinent material
relating to the appeal will be reviewed. No hearing will be held.
(3) If the appeal authority agrees that the record subject to the
appeal should be corrected or amended, the record will be amended and
the subject individual will be informed in writing of the correction or
amendment. Where an accounting was made of prior disclosures of the
record, all previous recipients of the record will be informed of the
corrective action taken.
(4) If the appeal is denied, the subject individual will be informed
in writing:
(i) Of the denial and the reasons for the denial;
(ii) That he has a right to seek judicial review of the denial; and,
(iii) That he may submit to the responsible Department official a
concise statement of disagreement to be associated with the disputed
record and disclosed whenever the record is disclosed.
(b) Notation and disclosure of disputed records. Whenever a subject
individual submits a statement of disagreement to the responsible
Department official in accordance with paragraph (a)(4)(iii) of this
section, the record will be noted to indicate that it is disputed. In
any subsequent disclosure, a copy of the subject individual's statement
of disagreement, will be disclosed with the record. If the responsible
Department official deems it appropriate, a concise statement of the
appeal authority's reasons for denying the subject individual's appeal
may also be disclosed with the record. While the subject individual will
have access to this statement of reasons, such statement will not be
subject to correction or amendment. Where an accounting was made of
prior disclosures of the record, all previous recipients of the record
will be provided a copy of the subject individual's statement of
disagreement, as well as the statement, if any, of the appeal
authority's reasons for denying the subject individual's appeal.
Sec. 5b.9 Disclosure of records.
(a) Consent to disclosure by a subject individual. (1) Except as
provided in paragraph (b) of this section authorizing disclosures of
records without consent, no disclosure of a record will be made without
the consent of the subject individual. In each case the consent, whether
obtained from the subject individual at the request of the Department or
whether provided to the Department by the subject individual on his own
initiative, shall be in writing. The consent shall specify the
individual, organizational unit or class of individuals or
organizational units to
[[Page 21]]
whom the record may be disclosed, which record may be disclosed and,
where applicable, during which time frame the record may be disclosed
(e.g., during the school year, while the subject individual is out of
the country, whenever the subject individual is receiving specific
services). A blanket consent to disclose all of a subject individual's
records to unspecified individuals or organizational units will not be
honored. The subject individual's identity and, where applicable (e.g.,
where a subject individual gives consent to disclosure of a record to a
specific individual), the identity of the individual to whom the record
is to be disclosed shall be verified.
(2) A parent or guardian of any minor is not authorized to give
consent to a disclosure of the minor's medical record.
(b) Disclosures without the consent of the subject individual. The
disclosures listed in this paragraph may be made without the consent of
the subject individual. Such disclosures are:
(1) To those officers and employees of the Department who have a
need for the record in the performance of their duties. The responsible
Department official may upon request of any officer or employee, or on
his own initiative, determine what constitutes legitimate need.
(2) Required to be disclosed under the Freedom of Information Act, 5
U.S.C. 552, and part 5 of this title.
(3) For a routine use as defined in paragraph (j) of Sec. 5b.1.
Routine uses will be listed in any notice of a system of records.
Routine uses published in appendix B are applicable to more than one
system of records. Where applicable, notices of systems of records may
contain references to the routine uses listed in appendix B. appendix B
will be published with any compendium of notices of systems of records.
(4) To the Bureau of the Census for purposes of planning or carrying
out a census or survey or related activity pursuant to the provisions of
title 13 U.S.C.
(5) To a recipient who has provided the agency with advance written
assurance that the record will be used solely as a statistical research
or reporting record; Provided, That, the record is transferred in a form
that does not identify the subject individual.
(6) To the National Archives of the United States as a record which
has sufficient historical or other value to warrant its continued
preservation by the United States Government, or for evaluation by the
Administrator of General Services or his designee to determine whether
the record has such value.
(7) To another government agency or to an instrumentality of any
governmental jurisdiction within or under the control of the United
States for a civil or criminal law enforcement activity if the activity
is authorized by law, and if the head of such government agency or
instrumentality has submitted a written request to the Department
specifying the record desired and the law enforcement activity for which
the record is sought.
(8) To an individual pursuant to a showing of compelling
circumstances affecting the health or safety of any individual if a
notice of the disclosure is transmitted to the last known address of the
subject individual.
(9) To either House of Congress, or to the extent of matter within
its jurisdiction, any committee or subcommittee thereof, any joint
committee of Congress or subcommittee of any such joint committee.
(10) To the Comptroller General, or any of the Comptroller General's
authorized representatives, in the course of the performance of the
duties of the General Accounting Office.
(11) Pursuant to the order of a court of competent jurisdiction.
(c) Accounting of disclosures. (1) An accounting of all disclosures
of a record will be made and maintained by the Department for 5 years or
for the life of the record, whichever is longer; except that, such an
accounting will not be made:
(i) For disclosures under paragraphs (b) (1) and (2) of this
section; and,
(ii) For disclosures made with the written consent of the subject
individual.
(2) The accounting will include:
(i) The date, nature, and purpose of each disclosure; and
[[Page 22]]
(ii) The name and address of the person or entity to whom the
disclosure is made.
(3) Any subject individual may request access to an accounting of
disclosures of a record. The subject individual shall make a request for
access to an accounting in accordance with the procedures in Sec. 5b.5
of this part. A subject individual will be granted access to an
accounting of the disclosures of a record in accordance with the
procedures of this part which govern access to the related record.
Access to an accounting of a disclosure of a record made under paragraph
(b)(7) of this section may be granted at the discretion of the
responsible Department official.
Sec. 5b.10 Parents and guardians.
For the purpose of this part, a parent or guardian of any minor or
the legal guardian or any individual who has been declared incompetent
due to physical or mental incapacity or age by a court of competent
jurisdiction is authorized to act on behalf of an individual or a
subject individual. Except as provided in paragraph (b)(2) of Sec.
5b.5, of this part governing procedures for verifying an individual's
identity, an individual authorized to act on behalf of a minor or legal
incompetent will be viewed as if he were the individual or subject
individual.
Sec. 5b.11 Exempt systems.
(a) General policy. The Act permits an agency to exempt certain
types of systems of records from some of the Act's requirements. It is
the policy of the Department to exercise authority to exempt systems of
records only in compelling cases.
(b) Specific systems of records exempted under (j)(2). The
Department exempts the Investigative Files of the Inspector General ED/
OIG (18-10-01) and the Hotline Complaint Files of the Inspector General
ED/OIG (18-10-04) systems of records from the following provisions of 5
U.S.C. 552a and this part:
(1) 5 U.S.C. 552a(c)(3) and Sec. 5b.9(a)(1) and (c)(3) of this
part, regarding access to an accounting of disclosures of a record.
(2) 5 U.S.C. 552a(c)(4) and Sec. Sec. 5b.7(c) and 5b.8(b) of this
part, regarding notification to outside parties and agencies of
correction or notation of dispute made in accordance with 5 U.S.C.
552a(d).
(3) 5 U.S.C. 552a(d) (1) through (4) and (f) and Sec. Sec.
5b.5(a)(1) and (c), 5b.7, and 5b.8 of this part, regarding notification
or access to records and correction or amendment of records.
(4) 5 U.S.C. 552a(e)(1) and Sec. 5b.4(a)(1) of this part, regarding
maintaining only relevant and necessary information.
(5) 5 U.S.C. 552a(e)(2) and Sec. 5b.4(a)(2) of this part, regarding
collection of information from the subject individual.
(6) 5 U.S.C. 552a(e)(3) and Sec. 5b.4(a)(3) of this part, regarding
notice to individuals asked to provide information to the Department.
(7) 5 U.S.C. 552a(e)(4) (G), (H), and (I), regarding inclusion of
information in the system notice about procedures for notification,
access, correction, and source of records.
(8) 5 U.S.C. 552a(e)(5), regarding maintaining records with
requisite accuracy, relevance, timeliness, and completeness.
(9) 5 U.S.C. 552a(e)(8), regarding service of notice on subject
individual if a record is made available under compulsory legal process
if that process becomes a matter of public record.
(10) 5 U.S.C. 552a(g), regarding civil remedies for violation of the
Privacy Act.
(c) Specific systems of records exempted under (k)(2). (1) The
Department exempts the Investigative Files of the Inspector General ED/
OIG (18-10-01), the Hotline Complaint Files of the Inspector General ED/
OIG (18-10-04), and the Office of Inspector General Data Analytics
System (ODAS) (18-10-02) from the following provisions of 5 U.S.C. 552a
and this part to the extent that these systems of records consist of
investigatory material and complaints that may be included in
investigatory material compiled for law enforcement purposes:
(i) 5 U.S.C. 552a(c)(3) and Sec. 5b.9(c)(3) of this part, regarding
access to an accounting of disclosures of records.
(ii) 5 U.S.C. 552a(d) (1) through (4) and (f) and Sec. Sec.
5b.5(a)(1) and (c), 5b.7, and 5b.8 of this part, regarding notification
of and access to records and correction or amendment of records.
(iii) 5 U.S.C. 552a(e)(1) and Sec. 5b.4(a)(1) of this part,
regarding the requirement
[[Page 23]]
to maintain only relevant and necessary information.
(iv) 5 U.S.C. 552a(e)(4) (G), (H), and (I), regarding inclusion of
information in the system notice about procedures for notification,
access, correction, and source of records.
(2) The Department exempts the Complaint Files and Log, Office for
Civil Rights (18-08-01) from the following provisions of 5 U.S.C. 552a
and this part:
(i) 5 U.S.C. 552a(c)(3) and Sec. 5b.9(c)(3) of this part, regarding
access to an accounting of disclosures of records.
(ii) 5 U.S.C. 552a(d) (1) through (4) and (f) and Sec. Sec.
5b.5(a)(1) and (c), 5b.7, and 5b.8 of this part, regarding notification
of and access to records and correction or amendment of records.
(iii) 5 U.S.C. 552a(e)(4) (G) and (H), regarding inclusion of
information in the system notice about procedures for notification,
access, and correction of records.
(d) Specific systems of records exempted under (k)(5). The
Department exempts the Investigatory Material Compiled for Personnel
Security and Suitability Purposes (18-05-17) system of records from the
following provisions of 5 U.S.C. 552a and this part:
(1) 5 U.S.C. 552a(c)(3) and Sec. 5b.9(c)(3) of this part, regarding
access to an accounting of disclosures of records.
(2) 5 U.S.C. 552a(d) (1) through (4) and (f) and Sec. Sec.
5b.5(a)(1) and (c), 5b.7, and 5b.8 of this part, regarding notification
of and access to records and correction or amendment of records.
(3) 5 U.S.C. 552a(e)(4) (G) and (H), regarding inclusion of
information in the system notice about procedures for notification,
access, and correction of records.
(e) Basis for exemptions taken under (j)(2), (k)(2), and (k)(5). The
reason the Department took each exemption described in this section is
stated in the preamble for the final rulemaking document under which the
exemption was promulgated. These final rulemaking documents were
published in the Federal Register and may be obtained from the
Department of Education by mailing a request to the following address:
U.S. Department of Education, Privacy Act Officer, Office of the Chief
Information Officer, Regulatory Information Management Group,
Washington, DC 20202-4651.
(f) Notification of or access to records in exempt systems of
records. (1) If a system of records is exempt under this section, an
individual may nonetheless request notification of or access to a record
in that system. An individual shall make requests for notification of or
access to a record in an exempt system or records in accordance with the
procedures of Sec. 5b.5 of this part.
(2) An individual will be granted notification of or access to a
record in an exempt system but only to the extent that notification or
access would not reveal the identity of a source who furnished the
record to the Department under an express promise, and, prior to
September 27, 1975, an implied promise, that his identity would be held
in confidence if--
(i) The record is in a system of records or that portion of a system
of records that is exempt under subsection (k)(2), but not under
subsection (j)(2), of the Act and the individual has been, as a result
of the maintenance of the record, denied a right, privilege, or benefit
to which he or she would otherwise be eligible; or
(ii) The record is in a system of records that is exempt under
subsection (k)(5) of the Act.
(3) If an individual is not granted notification of or access to a
record in a system of records exempt under subsections (k)(2) (but not
under subsection (j)(2)) and (k)(5) of the Act in accordance with this
paragraph, he or she will be informed that the identity of a
confidential source would be revealed if notification of or access to
the record were granted to the individual.
(g) Discretionary actions by the responsible Department official.
Unless disclosure of a record to the general public is otherwise
prohibited by law, the responsible Department official may, in his or
her discretion, grant notification of or access to a record in a system
of records that is exempt under this section. Discretionary notification
of or access to a record in accordance with this paragraph will not be a
precedent for discretionary notification of or access to a similar or
related record and
[[Page 24]]
will not obligate the responsible Department official to exercise his or
her discretion to grant notification of or access to any other record in
a system of records that is exempt under this section.
[58 FR 44424, Aug. 20, 1993, as amended at 64 FR 31066, June 9, 1999; 69
FR 12246, Mar. 15, 2004; 73 FR 61355, Oct. 16, 2008]
Sec. 5b.12 Contractors.
(a) All contracts entered into on or after September 27, 1975 which
require a contractor to maintain or on behalf of the Department to
maintain, a system of records to accomplish a Department function must
contain a provision requiring the contractor to comply with the Act and
this part.
(b) All unexpired contracts entered into prior to September 27, 1975
which require the contractor to maintain or on behalf of the Department
to maintain, a system of records to accomplish a Department function
will be amended as soon as practicable to include a provision requiring
the contractor to comply with the Act and this part. All such contracts
must be so amended by July 1, 1976 unless for good cause the appeal
authority identified in Sec. 5b.8 of this part authorizes the
continuation of the contract without amendment beyond that date.
(c) A contractor and any employee of such contractor shall be
considered employees of the Department only for the purposes of the
criminal penalties of the Act, 5 U.S.C. 552a(i), and the employee
standards of conduct listed in appendix A of this part where the
contract contains a provision requiring the contractor to comply with
the Act and this part.
(d) This section does not apply to systems of records maintained by
a contractor as a result of his management discretion, e.g., the
contractor's personnel records.
Sec. 5b.13 Fees.
(a) Policy. Where applicable, fees for copying records will be
charged in accordance with the schedule set forth in this section. Fees
may only be charged where an individual requests that a copy be made of
the record to which he is granted access. No fee may be charged for
making a search of the system of records whether the search is manual,
mechanical, or electronic. Where a copy of the record must be made in
order to provide access to the record (e.g., computer printout where no
screen reading is available), the copy will be made available to the
individual without cost.
(b) Fee schedule. The fee schedule for the Department is as follows:
(1) Copying of records susceptible to photocopying--$.10 per page.
(2) Copying records not susceptible to photocopying (e.g., punch
cards or magnetic tapes)--at actual cost to be determined on a case-by-
case basis.
(3) No charge will be made if the total amount of copying does not
exceed $25.
Sec. Appendix A to Part 5b--Employee Standards of Conduct
(a) General. All employees are required to be aware of their
responsibilities under the Privacy Act of 1974, 5 U.S.C. 552a.
Regulations implementing the Act are set forth in 34 CFR 5b. Instruction
on the requirements of the Act and regulation shall be provided to all
new employees of the Department. In addition, supervisors shall be
responsible for assuring that employees who are working with systems of
records or who undertake new duties which require the use of systems of
records are informed of their responsibilities. Supervisors shall also
be responsible for assuring that all employees who work with such
systems of records are periodically reminded of the requirements of the
Act and are advised of any new provisions or interpretations of the Act.
(b) Penalties. (1) All employees must guard against improper
disclosure of records which are governed by the Act. Because of the
serious consequences of improper invasions of personal privacy,
employees may be subject to disciplinary action and criminal prosecution
for knowing and willful violations of the Act and regulation. In
addition, employees may also be subject to disciplinary action for
unknowing or unwillful violations, where the employee had notice of the
provisions of the Act and regulations and failed to inform himself
sufficiently or to conduct himself in accordance with the requirements
to avoid violations.
(2) The Department may be subjected to civil liability for the
following actions undertaken by its employees:
(a) Making a determination under the Act and Sec. Sec. 5b.7 and
5b.8 of the regulation not to amend an individual's record in accordance
with his request, or failing to make such review in conformity with
those provisions;
[[Page 25]]
(b) Refusing to comply with an individual's request for notification
of or access to a record pertaining to him;
(c) Failing to maintain any record pertaining to any individual with
such accuracy, relevance, timeliness, and completeness as is necessary
to assure fairness in any determination relating to the qualifications,
character, rights, or opportunities of, or benefits to the individual
that may be made on the basis of such a record, and consequently a
determination is made which is adverse to the individual; or
(d) Failing to comply with any other provision of the Act or any
rule promulgated thereunder, in such a way as to have an adverse effect
on an individual.
(3) ``An employee may be personally subject to criminal liability as
set forth below and in 5 U.S.C. 552a (i):
(a) Any officer or employee of an agency, who by virtue of his
employment or official position, has possession of, or access to, agency
records which contain individually identifiable information the
disclosure of which is prohibited by the Act or by rules or regulations
established thereunder, and who, knowing that disclosure of the specific
material is so prohibited, willfully discloses the material in any
manner to any person or agency not entitled to receive it, shall be
guilty of a misdemeanor and fined not more than $5,000.''
(b) ``Any officer or employee of any agency who willfully maintains
a system of records without meeting the notice requirements [of the Act]
shall be guilty of a misdemeanor and fined not more than $5,000.''
(c) Rules Governing Employees Not Working With Systems of Records.
Employees whose duties do not involve working with systems of records
will not generally disclose to any one, without specific authorization
from their supervisors, records pertaining to employees or other
individuals which by reason of their official duties are available to
them. Notwithstanding the above, the following records concerning
Federal employees are a matter of public record and no further
authorization is necessary for disclosure:
(1) Name and title of individual.
(2) Grade classification or equivalent and annual rate of salary.
(3) Position description.
(4) Location of duty station, including room number and telephone
number.
In addition, employees shall disclose records which are listed in the
Department's Freedom of Information Regulation as being available to the
public. Requests for other records will be referred to the responsible
Department official. This does not preclude employees from discussing
matters which are known to them personally, and without resort to a
record, to official investigators of Federal agencies for official
purposes such as suitability checks, Equal Employment Opportunity
investigations, adverse action proceedings, grievance proceedings, etc.
(d) Rules governing employees whose duties require use or reference
to systems of records. Employees whose official duties require that they
refer to, maintain, service, or otherwise deal with systems of records
(hereinafter referred to as ``Systems Employees'') are governed by the
general provisions. In addition, extra precautions are required and
systems employees are held to higher standards of conduct.
(1) Systems Employees shall:
(a) Be informed with respect to their responsibilities under the
Act;
(b) Be alert to possible misuses of the system and report to their
supervisors any potential or actual use of the system which they believe
is not in compliance with the Act and regulation;
(c) Make a disclosure of records within the Department only to an
employee who has a legitimate need to know the record in the course of
his official duties;
(d) Maintain records as accurately as practicable.
(e) Consult with a supervisor prior to taking any action where they
are in doubt whether such action is in conformance with the Act and
regulation.
(2) Systems Employees shall not:
(a) Disclose in any form records from a system of records except (1)
with the consent or at the request of the subject individual; or (2)
where its disclosure is permitted under Sec. 5b.9 of the regulation.
(b) Permit unauthorized individuals to be present in controlled
areas. Any unauthorized individuals observed in controlled areas shall
be reported to a supervisor or to the guard force.
(c) Knowingly or willfully take action which might subject the
Department to civil liability.
(d) Make any arrangements for the design development, or operation
of any system of records without making reasonable effort to provide
that the system can be maintained in accordance with the Act and
regulation.
(e) Contracting officers. In addition to any applicable provisions
set forth above, those employees whose official duties involve entering
into contracts on behalf of the Department shall also be governed by the
following provisions:
(1) Contracts for design, or development of systems and equipment.
No contract for the design or development of a system of records, or for
equipment to store, service or maintain a system of records shall be
entered into unless the contracting officer has made reasonable effort
to ensure that the product to be purchased is capable of being used
without violation of the Act or regulation. Special attention shall be
given to provision of physical safeguards.
[[Page 26]]
(2) Contracts for the operation of systems and equipment. No
contract for the design or development of a system of whom he feels
appropriate, of all proposed contracts providing for the operation of
systems of records shall be made prior to execution of the contracts to
determine whether operation of the system of records is for the purpose
of accomplishing a Department function. If a determination is made that
the operation of the system is to accomplish a Department function, the
contracting officer shall be responsible for including in the contract
appropriate provisions to apply the provisions of the Act and regulation
to the system, including prohibitions against improper release by the
contractor, his employees, agents, or subcontractors.
(3) Other service contracts. Contracting officers entering into
general service contracts shall be responsible for determining the
appropriateness of including provisions in the contract to prevent
potential misuse (inadvertent or otherwise) by employees, agents, or
subcontractors of the contractor.
(f) Rules Governing Responsible Department Officials. In addition to
the requirements for Systems Employees, responsible Department officials
shall:
(1) Respond to all requests for notification of or access,
disclosure, or amendment of records in a timely fashion in accordance
with the Act and regulation;
(2) Make any amendment of records accurately and in a timely
fashion;
(3) Inform all persons whom the accounting records show have
received copies of the record prior to the amendments of the correction;
and
(4) Associate any statement of disagreement with the disputed
record, and
(a) Transmit a copy of the statement to all persons whom the
accounting records show have received a copy of the disputed record, and
(b) Transmit that statement with any future disclosure.
Sec. Appendix B to Part 5b--Routine Uses Applicable to More Than One
System of Records Maintained by ED
(1) In the event that a system of records maintained by this agency
to carry out its functions indicates a violation or potential violation
of law, whether civil, criminal or regulatory in nature, and whether
arising by general statute or particular program statute, or by
regulation, rule or order issued pursuant thereto, the relevant records
in the system of records may be referred, as a routine use, to the
appropriate agency, whether federal, or foreign, charged with the
responsibility of investigating or prosecuting such violation or charged
with enforcing or implementing the statute, or rule, regulation or order
issued pursuant thereto.
(2) Referrals may be made of assignments of research investigators
and project monitors to specific research projects to the Smithsonian
Institution to contribute to the Smithsonian Science Information
Exchange, Inc.
(3) In the event the Department deems it desirable or necessary, in
determining whether particular records are required to be disclosed
under the Freedom of Information Act, disclosure may be made to the
Department of Justice for the purpose of obtaining its advice.
(4) A record from this system of records may be disclosed as a
``routine use'' to a federal, state or local agency maintaining civil,
criminal or other relevant enforcement records or other pertinent
records, such as current licenses, if necessary to obtain a record
relevant to an agency decision concerning the hiring or retention of an
employee, the issuance of a security clearance, the letting of a
contract, or the issuance of a license, grant or other benefit.
A record from this system of records may be disclosed to a federal
agency, in response to its request, in connection with the hiring or
retention of an employee, the issuance of a security clearance, the
reporting of an investigation of an employee, the letting of a contract,
or the issuance of a license, grant, or other benefit by the requesting
agency, to the extent that the record is relevant and necessary to the
requesting agency's decision on the matter.
(5) In the event that a system of records maintained by this agency
to carry out its function indicates a violation or potential violation
of law, whether civil, criminal or regulatory in nature, and whether
arising by general statute or particular program statute, or by
regulation, rule or order issued pursuant thereto, the relevant records
in the system of records may be referred, as a routine use, to the
appropriate agency, whether state or local charged with the
responsibility of investigating or prosecuting such violation or charged
with enforcing or implementing the statute, or rule, regulation or order
issued pursuant thereto.
(6) Where federal agencies having the power to subpoena other
federal agencies' records, such as the Internal Revenue Service or the
Civil Rights Commission, issue a subpoena to the Department for records
in this system of records, the Department will make such records
available.
(7) Where a contract between a component of the Department and a
labor organization recognized under E.O. 11491 provides that the agency
will disclose personal records relevant to the organization's mission,
records in this system of records may be disclosed to such organization.
[[Page 27]]
(8) Where the appropriate official of the Department, pursuant to
the Department's Freedom of Information Regulation determines that it is
in the public interest to disclose a record which is otherwise exempt
from mandatory disclosure, disclosure may be made from this system of
records.
(9) The Department contemplates that it will contract with a private
firm for the purpose of collating, analyzing, aggregating or otherwise
refining records in this system. Relevant records will be disclosed to
such a contractor. The contractor shall be required to maintain Privacy
Act safeguards with respect to such records.
(10) To individuals and organizations, deemed qualified by the
Secretary to carry out specific research solely for the purpose of
carrying out such research.
(11) Disclosures in the course of employee discipline or competence
determination proceedings.
[45 FR 30808, May 9, 1980; 45 FR 37426, June 3, 1980]
PART 6_INVENTIONS AND PATENTS (GENERAL)--Table of Contents
Sec.
6.0 General policy.
6.1 Publication or patenting of inventions.
6.3 Licensing of Government-owned patents.
6.4 Central records; confidentiality.
Authority: 5 U.S.C. 301.
Source: 45 FR 30814, May 9, 1980, unless otherwise noted.
Sec. 6.0 General policy.
Inventions developed through the resources and activities of the
Department are a potential resource of great value to the public. It is
the policy of the Department:
(a) To safeguard the public interest in inventions developed by
Department employees, contractors and grantees with the aid of public
funds and facilities;
(b) To encourage and recognize individual and cooperative
achievement in research and investigations; and
(c) To establish a procedure, consistent with pertinent statutes,
Executive orders and general Government regulations, for the
determination of rights and obligations relating to the patenting of
inventions.
Sec. 6.1 Publication or patenting of inventions.
It is the general policy of the Department that the results of
Department research should be made widely, promptly and freely available
to other research workers and to the public. This availability can
generally be adequately preserved by the dedication of a Government-
owned invention to the public. Determinations to file a domestic patent
application on inventions in which the Department has an interest will
be made where the circumstances indicate that this is desirable in the
public interest, and if it is practicable to do so. Department
determinations not to apply for a domestic patent on employee inventions
are subject to review and approval by the Commissioner of Patents.
Except where deemed necessary for protecting the patent claim, the fact
that a patent application has been or may be filed will not require any
departure from normal policy regarding the dissemination of the results
of Department research.
Sec. 6.3 Licensing of Government-owned patents.
(a) Licenses to practice inventions covered by patents and pending
patent applications owned by the U.S. Government as represented by this
Department will generally be royalty free, revocable and nonexclusive.
They will normally be issued to all applicants and will generally
contain no limitations or standards relating to the quality or testing
of the products to be manufactured, sold, or distributed thereunder.
(b) Where it appears however that the public interest will be served
under the circumstances of the particular case by licenses which impose
conditions, such as those relating to quality or testing of products,
requirement of payment of royalties to the Government, etc., or by the
issuance of limited exclusive licenses by the Secretary after notice and
opportunity for hearing thereon, such licenses may be issued.
Sec. 6.4 Central records; confidentiality.
Central files and records shall be maintained of all inventions,
patents, and licenses in which the Department has an interest, together
with a record
[[Page 28]]
of all licenses issued by the Department under such patents. Invention
reports required from employees or others for the purpose of obtaining
determinations of ownership, and documents and information obtained for
the purpose of prosecuting patent applications shall be confidential and
shall be disclosed only as required for official purposes or with the
consent of the inventor.
PART 7_EMPLOYEE INVENTIONS--Table of Contents
Sec.
7.0 Who are employees.
7.1 Duty of employee to report inventions.
7.3 Determination as to domestic rights.
7.4 Option to acquire foreign rights.
7.7 Notice to employee of determination.
7.8 Employee's right of appeal.
Authority: E.O. 10096, 15 FR 391; 3 CFR 1950 Supp.; E.O. 10930, 26
FR 2583; 3 CFR 1961 Supp.
Source: 45 FR 30814, May 9, 1980, unless otherwise noted.
Sec. 7.0 Who are employees.
As used in this part, the term Government employee means any officer
or employee, civilian or military, except such part-time employees or
part-time consultants as may be excluded therefrom by a determination
made in writing by the head of the employee's office or constituent
organization, pursuant to an exemption approved by the Commissioner of
Patents that to include him or them would be impracticable or
inequitable, given the reasons therefor. A person shall not be
considered to be a part-time employee or part-time consultant for this
purpose unless the terms of his employment contemplate that he shall
work for less than the minimum number of hours per day, or less than a
minimum number of days per week, or less than the minimum number of
weeks per year, regularly required of full-time employees of his class.
Sec. 7.1 Duty of employee to report inventions.
Every Department employee is required to report to the Secretary in
accordance with the procedures established therefor, every invention
made by him (whether or not jointly with others) which bears any
relation to his official duties or which was made in whole or in any
part during working hours, or with any contribution of Government
facilities, equipment, material, funds, or information, or of time or
services of other Government employees on official duty.
Sec. 7.3 Determination as to domestic rights.
The determination of the ownership of the domestic right, title, and
interest in and to an invention which is or may be patentable, made by a
Government employee while under the administrative jurisdiction of the
Department, will be made in writing by the Secretary in accordance with
the provisions of Executive Order 10096 and Government-wide regulations
issued thereunder by the Commissioner of Patents as follows:
(a) The Government as represented by the Secretary shall obtain the
entire domestic right, title and interest in and to all inventions made
by any Government employee (1) during working hours, or (2) with a
contribution by the Government of facilities, equipment, materials,
funds, or information, or of time or services of other Government
employees on official duty, or (3) which bear a direct relation to or
are made in consequence of the official duties of the inventor.
(b) In any case where the contribution of the Government, as
measured by any one or more of the criteria set forth in paragraph (a)
of this section, to the invention is insufficient equitably to justify a
requirement of assignment to the Government of the entire domestic
right, title and interest in and to such invention, or in any case where
the Government has insufficient interest in an invention to obtain the
entire domestic right, title, and interest therein (although the
Government could obtain same under paragraph (a) of this section), the
Department, subject to the approval of the Commissioner, shall leave
title to such invention in the employee, subject, however, to the
reservation to the Government of a nonexclusive, irrevocable, royalty-
free license in the invention with power to grant licenses for all
governmental purposes, such reservation to
[[Page 29]]
appear, where practicable, in any patent, domestic or foreign, which may
issue on such invention.
(c) In applying the provisions of paragraphs (a) and (b) of this
section, to the facts and circumstances relating to the making of any
particular invention, it shall be presumed that an invention made by an
employee who is employed or assigned (1) to invent or improve or perfect
any art, machine, manufacture, or composition of matter, (2) to conduct
or perform research, development work, or both, (3) to supervise,
direct, coordinate, or review Government financed or conducted research,
development work, or both, or (4) to act in a liaison capacity among
governmental or nongovernmental agencies or individuals engaged in such
work, falls within the provisions of paragraph (a) of this section, and
it shall be presumed that any invention made by any other employee falls
within the provisions of paragraph (b) of this section. Either
presumption may be rebutted by a showing of the facts and circumstances
and shall not preclude a determination that these facts and
circumstances justify leaving the entire right, title and interest in
and to the invention in the Government employee, subject to law.
(d) In any case wherein the Government neither (1) obtains the
entire domestic right, title and interest in and to an invention
pursuant to the provisions of paragraph (a) of this section, nor (2)
reserves a nonexclusive, irrevocable, royalty-free license in the
invention, with power to grant licenses for all governmental purposes,
pursuant to the provisions of paragraph (b) of this section, the
Government shall leave the entire right, title and interest in and to
the invention in the Government employee, subject to law.
Sec. 7.4 Option to acquire foreign rights.
In any case where it is determined that all domestic rights should
be assigned to the Government, it shall further be determined, pursuant
to Executive Order 9865 and Government-wide regulations issued
thereunder, that the Government shall reserve an option to require the
assignment of such rights in all or in any specified foreign countries.
In case where the inventor is not required to assign the patent rights
in any foreign country or countries to the Government or the Government
fails to exercise its option within such period of time as may be
provided by regulations issued by the Commissioner of Patents, any
application for a patent which may be filed in such country or countries
by the inventor or his assignee shall nevertheless be subject to a
nonexclusive, irrevocable, royalty-free license to the Government for
all governmental purposes, including the power to issue sublicenses for
use in behalf of the Government and/or in furtherance of the foreign
policies of the Government.
Sec. 7.7 Notice to employee of determination.
The employee-inventor shall be notified in writing of the
Department's determination of the rights to his invention and of his
right of appeal, if any. Notice need not be given if the employee stated
in writing that he would agree to the determination of ownership which
was in fact made.
Sec. 7.8 Employee's right of appeal.
An employee who is aggrieved by a determination of the Department
may appeal to the Commissioner of Patents, pursuant to section 4(d) of
Executive Order 10096, as amended by Executive Order 10930, and
regulations issued thereunder, by filing a written appeal with the
Commissioner, in duplicate, and a copy of the appeal with the Secretary
within 30 days (or such longer period as the Commissioner may, for good
cause, fix in any case) after receiving written notice of such
determination.
PART 8_DEMANDS FOR TESTIMONY OR RECORDS IN LEGAL PROCEEDINGS--Table of
Contents
Sec.
8.1 What is the scope and applicability of this part?
8.2 What definitions apply?
8.3 What are the requirements for submitting a demand for testimony or
records?
8.4 What procedures are followed in response to a demand for testimony?
8.5 What procedures are followed in response to a demand for records?
[[Page 30]]
Authority: 5 U.S.C. 301; 5 U.S.C. 552; 20 U.S.C. 3474, unless
otherwise noted.
Source: 57 FR 34646, Aug. 5, 1992, unless otherwise noted.
Sec. 8.1 What is the scope and applicability of this part?
(a) Except as provided in paragraph (c) of this section, this part
establishes the procedures to be followed when the Department or any
employee of the Department receives a demand for--
(1) Testimony by an employee concerning--
(i) Records contained in the files of the Department;
(ii) Information relating to records contained in the files of the
Department; or
(iii) Information or records acquired or produced by the employee in
the course of his or her official duties or because of the employee's
official status; or
(2) The production or disclosure of any information or records
referred to in paragraph (a)(1) of this section.
(b) This part does not create any right or benefit, substantive or
procedural, enforceable by any person against the Department.
(c) This part does not apply to--
(1) Any proceeding in which the United States is a party before an
adjudicative authority;
(2) A demand for testimony or records made by either House of
Congress or, to the extent of matter within its jurisdiction, any
committee or subcommittee of Congress; or
(3) An appearance by an employee in his or her private capacity in a
legal proceeding in which the employee's testimony does not relate to
the mission or functions of the Department.
(Authority: 5 U.S.C. 301; 20 U.S.C. 3474)
[57 FR 34646, Aug. 5, 1992, as amended at 73 FR 27748, May 14, 2008]
Sec. 8.2 What definitions apply?
The following definitions apply to this part:
Adjudicative authority includes, but is not limited to--
(1) A court of law or other judicial forums; and
(2) Mediation, arbitration, or other forums for dispute resolution.
Demand includes a subpoena, subpoena duces tecum, request, order, or
other notice for testimony or records arising in a legal proceeding.
Department means the U.S. Department of Education.
Employee means a current or former employee or official of the
Department or of an advisory committee of the Department, including a
special government employee, unless specifically provided otherwise in
this part.
Legal proceeding means--
(1) A proceeding before an adjudicative authority;
(2) A legislative proceeding, except for a proceeding before either
House of Congress or before any committee or subcommittee of Congress,
to the extent of matter within the committee's or subcommittee's
jurisdiction; or
(3) An administrative proceeding.
Secretary means the Secretary of Education or an official or
employee of the Department acting for the Secretary under a delegation
of authority.
Testimony means statements made in connection with a legal
proceeding, including but not limited to statements in court or other
forums, depositions, declarations, affidavits, or responses to
interrogatories.
United States means the Federal Government of the United States and
any of its agencies or instrumentalities.
(Authority: 5 U.S.C. 301; 20 U.S.C. 3474)
[57 FR 34646, Aug. 5, 1992, as amended at 73 FR 27748, May 14, 2008]
Sec. 8.3 What are the requirements for submitting a demand for
testimony or records?
(a) A demand for testimony of an employee or a demand for records
issued pursuant to the rules governing the legal proceeding in which the
demand arises--
(1) Must be in writing; and
(2) Must state the nature of the requested testimony or records, why
the information sought is unavailable by any other means, and the reason
why the release of the information would not be contrary to an interest
of the Department or the United States''.
(b) Service of a demand for testimony of an employee must be made on
the employee whose testimony is demanded, with a copy simultaneously
[[Page 31]]
delivered to the General Counsel, U.S. Department of Education, Office
of the General Counsel, 400 Maryland Avenue, SW., room 6E300, Lyndon
Baines Johnson Building, Washington, DC 20202-2100.
(c) Service of a demand for records, as described in Sec.
8.5(a)(1), must be made on an employee who has custody of the records,
with a copy simultaneously delivered to the General Counsel at the
address listed in paragraph (b) of this section. For assistance in
identifying the custodian of the specific records demanded, contact the
Records Officer, Information Policy and Standards Team, Regulatory
Information Management Services, Office of Management, U.S. Department
of Education, 400 Maryland Avenue, SW., room 9161, PCP, Washington, DC
20202-4753.
(Authority: 5 U.S.C. 301; 20 U.S.C. 3474)
(Approved by the Office of Management and Budget under control number
1801-0002)
[57 FR 34646, Aug. 5, 1992, as amended at 58 FR 7860, Feb. 9, 1993; 73
FR 27748, May 14, 2008]
Sec. 8.4 What procedures are followed in response to a demand for
testimony?
(a) After an employee receives a demand for testimony, the employee
shall immediately notify the Secretary and request instructions.
(b) An employee may not give testimony without the prior written
authorization of the Secretary.
(c)(1) The Secretary may allow an employee to testify if the
Secretary determines that the demand satisfies the requirements of Sec.
8.3 and that granting permission--
(i) Would be appropriate under the rules of procedure governing the
matter in which the demand arises and other applicable laws, rules, and
regulations; and
(ii) Would not be contrary to an interest of the United States,
which includes furthering a public interest of the Department and
protecting the human and financial resources of the United States.
(2) The Secretary may establish conditions under which the employee
may testify.
(d) If a response to a demand for testimony is required before the
Secretary determines whether to allow an employee to testify, the
employee or counsel for the employee shall--
(1) Inform the court or other authority of the regulations in this
part; and
(2) Request that the demand be stayed pending the employee's receipt
of the Secretary's instructions.
(e) If the court or other authority declines the request for a stay,
or rules that the employee must comply with the demand regardless of the
Secretary's instructions, the employee or counsel for the employee shall
respectfully decline to comply with the demand, citing United States ex
rel. Touhy v. Ragen, 340 U.S. 462 (1951), and the regulations in this
part.
(Authority: 5 U.S.C. 301; 20 U.S.C. 3474)
Sec. 8.5 What procedures are followed in response to a demand for
records?
(a)(1) After an employee receives a demand for records issued
pursuant to the rules governing the legal proceeding in which the demand
arises, the employee shall immediately notify the Secretary and request
instructions.
(2) If an employee receives any other demand for records, the
Department--
(i) Considers the demand to be a request for records under the
Freedom of Information Act; and
(ii) Handles the demand under rules governing public disclosure, as
established in 34 CFR part 5.
(b) An employee may not produce records in response to a demand as
described in paragraph (a)(1) of this section without the prior written
authorization of the Secretary.
(c) The Secretary may make these records available if the Secretary
determines that the demand satisfies the requirements of Sec. 8.3 and
that disclosure--
(1) Would be appropriate under the rules of procedure governing the
matter in which the demand arises and other applicable laws, rules, and
regulations; and
(2) Would not be contrary to an interest of the United States, which
includes furthering a public interest of the Department and protecting
the human and financial resources of the United States.
(d) If a response to a demand for records as described in paragraph
(a)(1)
[[Page 32]]
of this section is required before the Secretary determines whether to
allow an employee to produce those records, the employee or counsel for
the employee shall--
(1) Inform the court or other authority of the regulations in this
part; and
(2) Request that the demand be stayed pending the employee's receipt
of the Secretary's instructions.
(e) If the court or other authority declines the request for a stay,
or rules that the employee must comply with the demand regardless of the
Secretary's instructions, the employee or counsel for the employee shall
respectfully decline to comply with the demand, citing United States ex
rel. Touhy v. Ragen, 340 U.S. 462 (1951), and the regulations in this
part.
(Authority: 5 U.S.C. 301; 5 U.S.C. 552; 20 U.S.C. 3474)
PART 12_DISPOSAL AND UTILIZATION OF SURPLUS FEDERAL REAL PROPERTY FOR
EDUCATIONAL PURPOSES--Table of Contents
Subpart A_General
Sec.
12.1 What is the scope of this part?
12.2 What definitions apply?
12.3 What other regulations apply to this program?
Subpart B_Distribution of Surplus Federal Real Property
12.4 How does the Secretary provide notice of availability of surplus
Federal real property?
12.5 Who may apply for surplus Federal real property?
12.6 What must an application for surplus Federal real property contain?
12.7 How is surplus Federal real property disposed of when there is more
than one applicant?
12.8 What transfer or lease instruments does the Secretary use?
12.9 What warranties does the Secretary give?
12.10 How is a Public Benefit Allowance (PBA) calculated?
Subpart C_Conditions Applicable to Transfers or Leases
12.11 What statutory provisions and Executive Orders apply to transfers
of surplus Federal real property?
12.12 What are the terms and conditions of transfers or leases of
surplus Federal real property?
12.13 When is use of the transferred surplus Federal real property by
entities other than the transferee or lessee permissible?
Subpart D_Enforcement
12.14 What are the sanctions for noncompliance with a term or condition
of a transfer or lease of surplus Federal real property?
Subpart E_Abrogation
12.15 What are the procedures for securing an abrogation of the
conditions and restrictions contained in the conveyance
instrument?
Appendix A to Part 12--Public Benefit Allowance for Transfer of Surplus
Federal Real Property for Educational Purposes
Authority: 40 U.S.C. 471-488; 20 U.S.C. 3401 et seq.; 42 U.S.C.
2000d (1) et seq.; 20 U.S.C. 1681 et seq.; 29 U.S.C. 794 et seq.; 42
U.S.C. 4332.
Source: 57 FR 60394, Dec. 18, 1992, unless otherwise noted.
Subpart A_General
Sec. 12.1 What is the scope of this part?
This part is applicable to surplus Federal real property located
within any State that is appropriate for assignment to, or that has been
assigned to, the Secretary by the Administrator for transfer for
educational purposes, as provided for in section 203(k) of the Federal
Property and Administrative Services Act of 1949, as amended, 63 Stat.
377 (40 U.S.C. 471 et seq.).
(Authority: 40 U.S.C. 484(k))
Sec. 12.2 What definitions apply?
(a) Definitions in the Act. The following terms used in this part
are defined in section 472 of the Act:
Administrator
Surplus property
(b) Definitions in the Education Department General Administrative
Regulations (EDGAR). The following terms used in this part are defined
in 34 CFR 77.1:
Department
Secretary
State
(c) Other definitions: The following definitions also apply to this
part:
[[Page 33]]
Abrogation means the procedure the Secretary may use to release the
transferee of surplus Federal real property from the covenants,
conditions, reservations, and restrictions contained in the conveyance
instrument before the term of the instrument expires.
Act means the Federal Property and Administrative Services Act of
1949, as amended, 63 Stat. 377 (40 U.S.C. 471 et seq.).
Applicant means an eligible entity as described in Sec. 12.5 that
formally applies to be a transferee or lessee of surplus Federal real
property, using a public benefit allowance (PBA) under the Act.
Lessee, except as used in Sec. 12.14(a)(5), means an entity that is
given temporary possession, but not title, to surplus Federal real
property by the Secretary for educational purposes.
Nonprofit institution means any institution, organization, or
association, whether incorporated or unincorporated--
(1) The net earnings of which do not inure or may not lawfully inure
to the benefit of any private shareholder or individual; and
(2) That has been determined by the Internal Revenue Service to be
tax-exempt under section 501(c)(3) of title 26.
Off-site property means surplus buildings and improvements--
including any related personal property--that are capable of being
removed from the underlying land and that are transferred by the
Secretary without transferring the underlying real property.
On-site property means surplus Federal real property, including any
related personal property--other than off-site property.
Period of restriction means that period during which the surplus
Federal real property transferred for educational purposes must be used
by the transferee or lessee in accordance with covenants, conditions,
and any other restrictions contained in the conveyance instrument.
Program and plan of use means the educational activities to be
conducted by the transferee or lessee using the surplus Federal real
property, as described in the application for that property.
Public benefit allowance (``PBA'') means the credit, calculated in
accordance with appendix A to this part, given to a transferee or lessee
which is applied against the fair market value of the surplus Federal
real property at the time of the transfer or lease of such property in
exchange for the proposed educational use of the property by the
transferee or lessee.
Related personal property means any personal property--
(1) That is located on and is an integral part of, or incidental to
the operation of, the surplus Federal real property; or
(2) That is determined by the Administrator to be otherwise related
to the surplus Federal real property.
Surplus Federal real property means the property assigned or
suitable for assignment to the Secretary by the Administrator for
disposal under the Act.
Transfer means to sell and convey title to surplus Federal real
property for educational purposes as described in this part.
Transferee means that entity which has purchased and acquired title
to the surplus Federal real property for educational purposes pursuant
to section 203(k) of the Act.
(Authority: 40 U.S.C. 472 and 20 U.S.C. 3401 et seq.)
Sec. 12.3 What other regulations apply to this program?
The following regulations apply to this program:
(a) 34 CFR parts 100, 104, and 106.
(b) 41 CFR part 101-47.
(c) 34 CFR part 85.
(Authority: 40 U.S.C. 484(k); 42 U.S.C. 2000d-1 et seq.; 29 U.S.C. 794
et seq.; 20 U.S.C. 1681 et seq.; Executive Order 12549; and 20 U.S.C.
3474)
Subpart B_Distribution of Surplus Federal Real Property
Sec. 12.4 How does the Secretary provide notice of availability of
surplus Federal real property?
The Secretary notifies potential applicants of the availability of
surplus Federal real property for transfer for educational uses in
accordance with 41 CFR 101-47.308-4.
(Authority: 40 U.S.C. 484(k)(1))
[[Page 34]]
Sec. 12.5 Who may apply for surplus Federal real property?
The following entities may apply for surplus Federal real property:
(a) A State.
(b) A political subdivision or instrumentality of a State.
(c) A tax-supported institution.
(d) A nonprofit institution.
(e) Any combination of these entities.
(Authority: 40 U.S.C. 484(k)(1)(A))
Sec. 12.6 What must an application for surplus Federal real property
contain?
An application for surplus Federal real property must--
(a) Contain a program and plan of use;
(b) Contain a certification from the applicant that the proposed
program is not in conflict with State or local zoning restrictions,
building codes, or similar limitations;
(c) Demonstrate that the proposed program and plan of use of the
surplus Federal real property is for a purpose that the applicant is
authorized to carry out;
(d) Demonstrate that the applicant is able, willing, and authorized
to assume immediate custody, use, care, and maintenance of the surplus
Federal real property;
(e) Demonstrate that the applicant is able, willing, and authorized
to pay the administrative expenses incident to the transfer or lease;
(f) Demonstrate that the applicant has the necessary funds, or the
ability to obtain those funds immediately upon transfer or lease, to
carry out the proposed program and plan of use for the surplus Federal
real property;
(g) Demonstrate that the applicant has an immediate need and ability
to use all of the surplus Federal real property for which it is
applying;
(h) Demonstrate that the surplus Federal real property is needed for
educational purposes at the time of application and that it is so needed
for the duration of the period of restriction;
(i) Demonstrate that the surplus Federal real property is suitable
or adaptable to the proposed program and plan of use; and
(j) Provide information requested by the Secretary in the notice of
availability, including information of the effect of the proposed
program and plan of use on the environment.
(Approved by the Office of Management and Budget under control number
1880-0524)
(Authority: 40 U.S.C. 484(k))
Sec. 12.7 How is surplus Federal real property disposed of when there
is more than one applicant?
(a) If there is more than one applicant for the same surplus Federal
real property, the Secretary transfers or leases the property to the
applicant whose proposed program and plan of use the Secretary
determines provides the greatest public benefit, using the criteria
contained in appendix A to this part that broadly address the weight
given to each type of entity applying and its proposed program and plan
of use. (See example in Sec. 12.10(d)).
(b) If, after applying the criteria described in paragraph (a) of
this section, two or more applicants are rated equally, the Secretary
transfers or leases the property to one of the applicants after--
(1) Determining the need for each applicant's proposed educational
use at the site of the surplus Federal real property;
(2) Considering the quality of each applicant's proposed program and
plan of use; and
(3) Considering each applicant's ability to carry out its proposed
program and plan of use.
(c) If the Secretary determines that the surplus Federal real
property is capable of serving more than one applicant, the Secretary
may apportion it to fit the needs of as many applicants as is
practicable.
(d)(1) The Secretary generally transfers surplus Federal real
property to a selected applicant that meets the requirements of this
part.
(2) Alternatively, the Secretary may lease surplus Federal real
property to a selected applicant that meets the requirements of this
part if the Secretary determines that a lease will promote the most
effective use of the property consistent with the purposes of this part
or if having a lease is otherwise in
[[Page 35]]
the best interest of the United States, as determined by the Secretary.
(Authority: 40 U.S.C. 484(k))
Sec. 12.8 What transfer or lease instruments does the Secretary use?
(a) The Secretary transfers or leases surplus Federal real property
using transfer or lease instruments that the Secretary prescribes.
(b) The transfer or lease instrument contains the applicable terms
and conditions described in this part and any other terms and conditions
the Secretary or Administrator determines are appropriate or necessary.
(Authority: 40 U.S.C. 484(c))
Sec. 12.9 What warranties does the Secretary give?
The Secretary transfers or leases surplus Federal real property on
an ``as is, where is,'' basis without warranty of any kind.
(Authority: 40 U.S.C. 484(k)(1))
Sec. 12.10 How is a Public Benefit Allowance (PBA) calculated?
(a) The Secretary calculates a PBA in accordance with the provisions
of appendix A to this part taking into account the nature of the
applicant, and the need for, impact of, and type of program and plan of
use for the property, as described in that appendix.
(b) The following are illustrative examples of how a PBA would be
calculated and applied under appendix A:
(1) Entity A is a specialized school that has had a building
destroyed by fire, and that has existing facilities determined by the
Secretary to be between 26 and 50% inadequate. It is proposing to use
the surplus Federal real property to add a new physical education
program. Entity A would receive a basic PBA of 70%, a 10% hardship
organization allowance, a 20% allowance for inadequacy of existing
school plant facilities, and a 10% utilization allowance for
introduction of new instructional programs. Entity A would have a total
PBA of 110%. If Entity A is awarded the surplus Federal real property,
it would not be required to pay any cash for the surplus Federal real
property, since the total PBA exceeds 100%.
(2) Entity B proposes to use the surplus Federal real property for
nature walks. Because this qualifies as an outdoor educational program,
Entity B would receive a basic PBA of 40%. If Entity B is awarded the
surplus Federal real property, it would be required to pay 60% of the
fair market value of the surplus Federal real property in cash at the
time of the transfer.
(3) Entity C is an accredited university, has an ROTC unit, and
proposes to use the surplus Federal real property for a school health
clinic and for special education of the physically handicapped. Entity C
would receive a basic PBA of 50% (as a college or university), a 20%
accreditation organization allowance (accredited college or university),
a 10% public service training organization allowance (ROTC), a 10%
student health and welfare utilization allowance (school health clinic),
and a 10% service to the handicapped utilization allowance (education of
the physically handicapped). Entity C would have a total PBA of 100%. If
Entity C is awarded the surplus Federal real property, it would not be
required to pay any cash for the surplus Federal real property, since
the total PBA is 100%.
(4) Entities A, B, and C all submit applications for the same
surplus Federal real property. Unless the Secretary decides to apportion
it, the Secretary transfers or leases the surplus Federal real property
to Entity A, since its proposed program and plan of use has the highest
total PBA.
(Authority: 40 U.S.C. 484(k)(1)(c))
Subpart C_Conditions Applicable to Transfers or Leases
Sec. 12.11 What statutory provisions and Executive Orders apply to
transfers of surplus Federal real property?
The Secretary directs the transferee or lessee to comply with
applicable provisions of the following statutes and Executive Orders
prior to, or immediately upon, transfer or lease, as applicable:
(a) National Environmental Policy Act of 1969, 42 U.S.C. 4332.
(b) National Historic Preservation Act of 1966, 16 U.S.C. 470.
(c) National Flood Insurance Act of 1968, 42 U.S.C. 4001 et seq.
[[Page 36]]
(d) Floodplain Management, Exec. Order No. 11988, 42 FR 26951 (May
25, 1977).
(e) Protection of Wetlands, Exec. Order No. 11990, 42 FR 26961 (May
25, 1977).
(f) Title VI of the Civil Rights Act of 1964, 42 U.S.C. 2000(d)(1)
et seq.
(g) Title IX of the Education Amendments of 1972, 20 U.S.C. 1681 et
seq.
(h) Section 504 of the Rehabilitation Act of 1973, 29 U.S.C. 794 et
seq.
(i) Age Discrimination Act of 1975, 42 U.S.C. 1601 et seq.
(j) Any other applicable Federal or State laws and Executive Orders.
(Authority: 40 U.S.C. 484(k))
(Approved by the Office of Management and Budget under control number
1880-0524)
Sec. 12.12 What are the terms and conditions of transfers or leases
of surplus Federal real property?
(a) General terms and conditions for transfers and leases. The
following general terms and conditions apply to transfers and leases of
surplus Federal real property under this part:
(1) For the period provided in the transfer or lease instrument, the
transferee or lessee shall use all of the surplus Federal real property
it receives solely and continuously for its approved program and plan of
use, in accordance with the Act and these regulations, except that--
(i) The transferee or lessee has twelve (12) months from the date of
transfer to place this surplus Federal real property into use, if the
Secretary did not, at the time of transfer, approve in writing
construction of major new facilities or major renovation of the
property;
(ii) The transferee or lessee has thirty-six (36) months from the
date of transfer to place the surplus Federal real property into use, if
the transferee or lessee proposes construction of major new facilities
or major renovation of the property and the Secretary approves it in
writing at the time of transfer; and
(iii) The Secretary may permit use of the surplus Federal real
property at any time during the period of restriction by an entity other
than the transferee or lessee in accordance with Sec. 12.13.
(2) The transferee or lessee may not modify its approved program and
plan of use without the prior written consent of the Secretary.
(3) The transferee or lessee may not sell, lease or sublease, rent,
mortgage, encumber, or otherwise dispose of all or a portion of the
surplus Federal real property or any interest therein without the prior
written consent of the Secretary.
(4) A transferee or lessee shall pay all administrative costs
incidental to the transfer or lease including, but not limited to--
(i) Transfer taxes;
(ii) Surveys;
(iii) Appraisals;
(iv) Inventory costs;
(v) Legal fees;
(vi) Title search;
(vii) Certificate or abstract expenses;
(viii) Decontamination costs;
(ix) Moving costs;
(x) Recordation expenses;
(xi) Other closing costs; and
(xii) Service charges, if any, provided for by an agreement between
the Secretary and the applicable State agency for Federal Property
Assistance.
(5) The transferee or lessee shall protect the residual financial
interest of the United States in the surplus Federal real property by
insurance or such other means as the Secretary directs.
(6) The transferee or lessee shall file with the Secretary reports
on its maintenance and use of the surplus Federal real property and any
other reports required by the Secretary in accordance with the transfer
or lease instrument.
(7) Any other term or condition that the Secretary determines
appropriate or necessary.
(b) Additional terms and conditions for on-site transfers. The terms
and conditions in the transfer, including those in paragraph (a) of this
section, apply for a period not to exceed thirty (30) years.
(c) Additional terms and conditions for off-site transfers. (1) The
terms and conditions in the transfer, including those in paragraph (a)
of this section, apply for a period equivalent to the estimated economic
life of the property conveyed for a transfer of off-site surplus Federal
real property.
(2) In addition to the terms and conditions contained in paragraph
(c) of
[[Page 37]]
this section, the Secretary may also require the transferee of off-site
surplus Federal real property--
(i) To post performance bonds;
(ii) To post performance guarantee deposits; or
(iii) To give such other assurances as may be required by the
Secretary or the holding agency to ensure adequate site clearance.
(d) Additional terms and conditions for leases. In addition to the
terms and conditions contained in paragraph (a) of this section, the
Secretary requires, for leases of surplus Federal real property, that
all terms and conditions apply to the initial lease agreement, and any
renewal periods, unless specifically excluded in writing by the
Secretary.
(Authority: 40 U.S.C. 484(k)(1))
(Approved by the Office of Management and Budget under control number
1880-0524)
Sec. 12.13 When is use of the transferred surplus Federal real
property by entities other than the transferee or lessee permissible?
(a) By eligible entities. A transferee or lessee may permit the use
of all or a portion of the surplus Federal real property by another
eligible entity as described in Sec. 12.5, only upon those terms and
conditions the Secretary determines appropriate if--
(1) The Secretary determines that the proposed use would not
substantially limit the program and plan of use by the transferee or
lessee and that the use will not unduly burden the Department;
(2) The Secretary's written consent is obtained by the transferee or
lessee in advance; and
(3) The Secretary approves the use instrument in advance and in
writing.
(b) By ineligible entities. A transferee or lessee may permit the
use of a portion of the surplus Federal real property by an ineligible
entity, one not described in Sec. 12.5, only upon those terms and
conditions the Secretary determines appropriate if--
(1) In accordance with paragraph (a) of this section, the Secretary
makes the required determination and approves both the use and the use
instrument;
(2) The use is confined to a portion of the surplus Federal real
property;
(3) The use does not interfere with the approved program and plan of
use for which the surplus Federal real property was conveyed; and
(4) Any rental fees or other compensation for use are either
remitted directly to the Secretary or are applied to purposes expressly
approved in writing in advance by the Secretary.
(Authority: 40 U.S.C. 484(k)(4))
Subpart D_Enforcement
Sec. 12.14 What are the sanctions for noncompliance with a term or
condition of a transfer or lease of surplus Federal real property?
(a) General sanctions for noncompliance. The Secretary imposes any
or all of the following sanctions, as applicable, to all transfers or
leases of surplus Federal real property:
(1) If all or a portion of, or any interest in, the transferred or
leased surplus Federal real property is not used or is sold, leased or
subleased, encumbered, disposed of, or used for purposes other than
those in the approved program and plan of use, without the prior written
consent of the Secretary, the Secretary may require that--
(i) All revenues and the reasonable value of other benefits received
by the transferee or lessee directly or indirectly from that use, as
determined by the Secretary, be held in trust by the transferee or
lessee for the United States subject to the direction and control of the
Secretary;
(ii) Title or possession to the transferred or leased surplus
Federal real property and the right to immediate possession revert to
the United States;
(iii) The surplus Federal real property be transferred or leased to
another eligible entity as the Secretary directs;
(iv) The transferee or lessee abrogate the conditions and
restrictions in the transfer or lease instrument in accordance with the
provisions of Sec. 12.15;
(v) The transferee or lessee place the surplus Federal real property
into immediate use for an approved purpose and extend the period of
restriction in the transfer or lease instrument for a term equivalent to
the period during
[[Page 38]]
which the property was not fully and solely used for an approved use; or
(vi) The transferee or lessee comply with any combination of the
sanctions described in paragraph (a)(1) or (a)(3) of this section.
(2) If title or possession reverts to the United States for
noncompliance or is voluntarily reconveyed, the Secretary may require
the transferee or lessee--
(i) To reimburse the United States for the decrease in value of the
transferred or leased surplus Federal real property not due to--
(A) Reasonable wear and tear;
(B) Acts of God; or
(C) Reasonable alterations made by the transferee or lessee to adapt
the surplus Federal real property to the approved program and plan of
use for which it was transferred or leased;
(ii) To reimburse the United States for any costs incurred in
reverting title or possession;
(iii) To forfeit any cash payments made by the transferee or lessee
against the purchase or lease price of surplus Federal real property
transferred;
(iv) To take any other action directed by the Secretary; or
(v) To comply with any combination of the provisions of paragraph
(a)(3) of this section.
(3) If the transferee or lessee does not put the surplus Federal
real property into use within the applicable time limitation in Sec.
12.12(a), the Secretary may require the transferee or lessee to make
cash payments to the Secretary equivalent to the current fair market
rental value of the surplus Federal real property for each month during
which the program and plan of use has not been implemented.
(Authority: 40 U.S.C. 484(k)(4))
(4) If the Secretary determines that a lessee of a transferee or a
sublessee of a lessee is not complying with a term or condition of the
lease, or if the lessee voluntarily surrenders the premises, the
Secretary may require termination of the lease.
(Authority: 40 U.S.C. 484(k)(4)(A))
(b) Additional sanction for noncompliance with off-site transfer. In
addition to the sanctions in paragraph (a) of this section, if the
Secretary determines that a transferee is not complying with a term or
condition of a transfer of off-site surplus Federal real property, the
Secretary may require that the unearned PBA become immediately due and
payable in cash to the United States.
(Authority: 40 U.S.C. 484(k)(4)(A))
Subpart E_Abrogation
Sec. 12.15 What are the procedures for securing an abrogation of the
conditions and restrictions contained in the conveyance instrument?
(a) The Secretary may, in the Secretary's sole discretion, abrogate
the conditions and restrictions in the transfer or lease instrument if--
(1) The transferee or lessee submits to the Secretary a written
request that the Secretary abrogate the conditions and restrictions in
the conveyance instrument as to all or any portion of the surplus
Federal real property;
(2) The Secretary determines that the proposed abrogation is in the
best interests of the United States;
(3) The Secretary determines the terms and conditions under which
the Secretary will consent to the proposed abrogation; and
(4) The Secretary transmits the abrogation to the Administrator and
there is no disapproval by the Administrator within thirty (30) days
after notice to the Administrator.
(b) The Secretary abrogates the conditions and restrictions in the
transfer or lease instrument upon a cash payment to the Secretary based
on the formula contained in the transfer or lease instrument and any
other terms and conditions the Secretary deems appropriate to protect
the interest of the United States.
(Authority: 40 U.S.C. 484(k)(4)(A)(iii))
[[Page 39]]
Sec. Appendix A to Part 12--Public Benefit Allowance for Transfer of
Surplus Federal Real Property for Educational Purposes \1\
---------------------------------------------------------------------------
\1\ This Appendix applies to transfers of both on-site and off-site
surplus property.
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Percent allowed
-----------------------------------------------------------------------------------------------------------------------------------------
Organization allowances Utilization allowances
Basic -------------------------------------------------------------------------------------------------------------------- Maximum
Classification public Inadequacy of existing Introduction Student public
benefit Federal Public school plant facilities of new health Service to benefit
allowance Accreditation impact service Hardship ------------------------- instructional and Research handicapped allowance
training 10-25% 26-50% 51-100% programs welfare \4\
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Elementary or high schools............................ 70 ............. 10 10 10 10 20 30 10 10 10 10 100
Colleges or Universities.............................. 50 20 ....... 10 10 10 20 30 10 10 10 10 100
Specialized schools................................... 70 ............. ....... 10 10 10 20 30 10 10 10 10 100
Public libraries or educational museums............... \2\ 100 ............. ....... ........ ........ ...... ...... ....... ............. ....... ........ ........... \2\ 100
School outdoor education.............................. 40 ............. ....... ........ ........ ...... ...... ....... 10 \3\ 10 10 ........... 70
Central administrative and/or service centers......... 80 ............. ....... ........ ........ ...... ...... ....... ............. ....... ........ ........... 80
Non-profit educational research organizations......... 50 20 ....... 10 ........ ...... ...... ....... 10 10 ........ 10 100
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
\2\ Applicable when this is the primary use to be made of the property. The public benefit allowance for the overall program is applicable when such facilities are conveyed as a minor
component of other facilities.
\3\ This 10% may include an approvable recreation program which will be accessible to the public and entirely compatible with, but subordinate to, the educational program.
\4\ This column establishes the maximum discount from the fair market value for payment due from the transferee at the time of the transfer. This column does not apply for purposes of ranking
applicants to determine to which applicant the property will be transferred. Competitive rankings are based on the absolute total of public benefit allowance points and are not limited to
the 100% ceiling.
Description of Terms Used in This Appendix
Elementary or High School means an elementary school (including a
kindergarten), high school, junior high school, junior-senior high
school or elementary or secondary school system, that provides
elementary or secondary education as determined under State law.
However, it does not include a nursery school even though it may operate
as part of a school system.
College or University means a non-profit or public university or
college, including a junior college, that provides postsecondary
education.
Specialized School means a vocational school, area trade school,
school for the blind, or similar school.
Public Library means a public library or public library service
system, not a school library or library operated by non-profit, private
organizations or institutions that may be open to the general public.
School libraries receive the public benefit allowance in the appropriate
school classification.
Educational Museum means a museum that conducts courses on a
continuing, not ad hoc, basis for students who receive credits from
accredited postsecondary education institutions or school systems.
School Outdoor Education means a separate facility for outdoor
education as distinguished from components of a basic school. Components
of a school such as playgrounds and athletic fields receive the basic
allowance applicable for that type of school. The outdoor education must
be located reasonably near the school system and may be open to and used
by the general public, but only if the educational program for which the
property is conveyed is given priority of use. This category does not
include components of the school such as playgrounds and athletic
fields, that are utilized during the normal school year, and are
available to all students.
Central Administrative and/or Service Center means administrative
office space, equipment storage areas, and similar facilities.
[[Page 40]]
Description of Allowances
Basic Public Benefit Allowance means an allowance that is earned by
an applicant that satisfies the requirements of Sec. 12.10 of this
part.
Organization Allowance
Accreditation means an allowance that is earned by any postsecondary
educational institution, including a vocational or trade school, that is
accredited by an accrediting agency recognized by the Secretary under 34
CFR part 602.
Federal Impact means an allowance that is earned by any local
educational agency (LEA) qualifying for Federal financial assistance as
the result of the impact of certain Federal activities upon a community,
such as the following under Public Law 81-874 and Public Law 81-815: to
any LEA charged by law with responsibility for education of children who
reside on, or whose parents are employed on, Federal property, or both;
to any LEA to which the Federal Government has caused a substantial and
continuing financial burden as the result of the acquisition of a
certain amount of Federal property since 1938; or to any LEA that
urgently needs minimum school facilities due to a substantial increase
in school membership as the result of new or increased Federal
activities.
Public Services Training means an allowance that is earned if the
applicant has cadet or ROTC units or other personnel training contracts
for the Federal or State governments. This is given to a school system
only if the particular school receiving the property furnishes that
training.
Hardship means an allowance earned by an applicant that has suffered
a significant facility loss because of fire, storm, flood, other
disaster, or condemnation. This allowance is also earned if unusual
conditions exist such as isolation or economic factors that require
special consideration.
Inadequacies of Existing Facilities means an allowance that is
earned on a percentage basis depending on the degree of inadequacy
considering both public and nonpublic facilities. Overall plant
requirements are determined based on the relationship between the
maximum enrollment accommodated in the present facilities, excluding
double and night sessions and the anticipated enrollment if the
facilities are transferred. Inadequacies may be computed for a component
school unit such as a school farm, athletic field, facility for home
economics, round-out school site, cafeteria, auditorium, teacherages,
faculty housing, etc., only if the component is required to meet State
standards. In that event, the State Department of Education will be
required to provide a certification of the need. Component school unit
inadequacies may only be related to a particular school and not to the
entire school system.
Utilization Allowances
Introduction of New Instructional Programs means an allowance that
is earned if the proposed use of the property indicates that new
programs will be added at a particular school. Examples of these new
programs include those for vocational education, physical education,
libraries, and similar programs.
Student Health and Welfare means an allowance that is earned if the
proposed program and plan of use of the property provides for cafeteria,
clinic, infirmary, bus loading shelters, or other uses providing for the
well-being and health of students and eliminating safety and health
hazards.
Research means an allowance that is earned if the proposed use of
the property will be predominantly for research by faculty or graduate
students under school auspices, or other primary educational research.
Service to Handicapped means an allowance that is earned if the
proposed program and plan of use for the property will be for special
education for the physically or mentally handicapped.
PART 15_UNIFORM RELOCATION ASSISTANCE AND REAL PROPERTY ACQUISITION
FOR FEDERAL AND FEDERALLY ASSISTED PROGRAMS--Table of Contents
Authority: Section 213, Uniform Relocation Assistance and Real
Property Acquisition Policies Act of 1970, Pub. L. 91-646, 84 Stat. 1894
(42 U.S.C. 4601) as amended by the Surface Transportation and Uniform
Relocation Assistance Act of 1987, Title IV of Pub. L. 100-17, 101 Stat.
246-256 (42 U.S.C. 4601 note).
Sec. 15.1 Uniform relocation assistance and real property acquisition.
Regulations and procedures for complying with the Uniform Relocation
Assistance Act of 1970 (Pub. L. 91-646, 84 Stat. 1894, 42 U.S.C. 4601)
as amended by the SUrface Transportation and Uniform Relocation
Assistance Act of 1987 (Title IV of Pub. L. 100-17, 101 Stat. 264-255,
42 U.S.C. 4601 note) are set forth in 49 CFR part 24.
[52 FR 48021, Dec. 17, 1987]
[[Page 41]]
PART 21_EQUAL ACCESS TO JUSTICE--Table of Contents
Subpart A_General
Sec.
21.1 Equal Access to Justice Act.
21.2 Time period when the Act applies.
21.3 Definitions.
Subpart B_Which Adversary Adjudications Are Covered?
21.10 Adversary adjudications covered by the Act.
21.11 Effect of judicial review of adversary adjudication.
Subpart C_How Is Eligibility Determined?
21.20 Types of eligible applicants.
21.21 Determination of net worth and number of employees.
21.22 Applicants representing others.
Subpart D_How Does One Apply for an Award?
21.30 Time for filing application.
21.31 Contents of application.
21.32 Confidentiality of information about net worth.
21.33 Allowable fees and expenses.
Subpart E_What Procedures Are Used in Considering Applications?
21.40 Filing and service of documents.
21.41 Answer to application.
21.42 Reply.
21.43 Comments by other parties.
21.44 Further proceedings.
Subpart F_How Are Awards Determined?
21.50 Standards for awards.
21.51 Initial decision in applications not subject to the CRRA.
21.52 Initial decision by an adjudicative officer in applications
subject to CRRA jurisdiction.
21.53 Final decision of the CRRA.
21.54 Review by the Secretary.
21.55 Final decision if the Secretary does not review.
21.56 Judicial review.
Subpart G_How Are Awards Paid?
21.60 Payment of awards.
21.61 Release.
Authority: 5 U.S.C. 504, unless otherwise noted.
Source: 58 FR 47192, Sept. 7, 1993, unless otherwise noted.
Subpart A_General
Sec. 21.1 Equal Access to Justice Act.
(a) The Equal Access to Justice Act (the Act) provides for the award
of fees and other expenses to applicants that--
(1) Are prevailing parties in adversary adjudications before the
Department of Education; and
(2) Meet all other conditions of eligibility contained in this part.
(b) An eligible applicant, as described in paragraph (a) of this
section, is entitled to receive an award unless--
(1) The adjudicative officer, the Civil Rights Reviewing Authority
(CRRA), or the Secretary on review, determines that--
(i) The Department's position was substantially justified; or
(ii) Special circumstances make an award unjust; or
(2) The adversary adjudication is under judicial review, in which
case the applicant may receive an award only as described in Sec.
21.11.
(c) The determination under paragraph (b)(1)(i) of this section is
based on the administrative record, as a whole, made during the
adversary adjudication for which fees and other expenses are sought.
(Authority: 5 U.S.C. 504(a)(1) and (c)(1))
Sec. 21.2 Time period when the Act applies.
The Act applies to any adversary adjudication covered under this
part pending or commenced before the Department on or after August 5,
1985.
(Authority: 5 U.S.C. 504(note))
Sec. 21.3 Definitions.
The following definitions apply to this part:
Act means the Equal Access to Justice Act.
Adjudicative officer means the Administrative Law Judge, hearing
examiner, or other deciding official who presided at the underlying
adversary adjudication.
(Authority: 5 U.S.C. 504(b)(1)(D))
Adversary adjudication means a proceeding--
(1) Conducted by the Department for the formulation of an order or
decision
[[Page 42]]
arising from a hearing on the record under the Administrative Procedure
Act (5 U.S.C. 554);
(2) Listed in Sec. 21.10; and
(3) In which the position of the Department was represented by
counsel or other representative who entered an appearance and
participated in the proceeding.
(Authority: 5 U.S.C. 504(b)(1)(C))
Application subject to the jurisdiction of the CRRA means an
application for fees and expenses based on an underlying proceeding
conducted under 34 CFR parts 100, 101, 104, 106, or 110.
(Authority: 5 U.S.C. 504(b)(1)(C); 20 U.S.C. 1681; 29 U.S.C. 794; 42
U.S.C. 2000d-1 et seq. and 6101 et seq.)
CRRA means the Civil Rights Reviewing Authority, the reviewing
authority established by the Secretary to consider applications under 34
CFR parts 100, 101, 104, 106, and 110.
(Authority: 5 U.S.C. 504(b)(1)(C); 20 U.S.C. 1681; 29 U.S.C. 794; 42
U.S.C. 2000d-1 et seq. and 6101 et seq.)
Department means the U.S. Department of Education.
Department's counsel means counsel for the Department of Education
or another Federal agency.
Employee means:
(1) A person who regularly performs services for an applicant--
(i) For remuneration; and
(ii) Under the applicant's direction and control.
(2) A part-time or seasonal employee who performs services for an
applicant--
(i) For renumeration; and
(ii) Under the applicant's direction and control.
(Authority: 5 U.S.C. 504(c)(1))
Fees and other expenses means an eligible applicant's reasonable
fees and expenses--
(1) Related to the issues on which it was the prevailing party in
the adversary adjudication; and
(2) Further described in Sec. Sec. 21.33 and 21.50.
(Authority: 5 U.S.C. 504 (a)(1), (b)(1)(A), and (c)(1))
Party means a ``person'' or a ``party'' as those terms are defined
in the Administrative Procedure Act (5 U.S.C. 551(3)), including an
individual, partnership, corporation, association, unit of local
government, or public or private organization that meets the
requirements in Sec. 21.20. The term does not include an agency of the
Federal Government.
(Authority: 5 U.S.C. 504(b)(1)(B))
Position of the Department means, in addition to the position taken
by the Department in the adversary adjudication, the action or failure
to act by the Department upon which the adversary adjudication is based.
(Authority: 5 U.S.C. 504 (a)(1) and (b)(1)(E))
Secretary means the Secretary of the U.S. Department of Education or
an official or employee of the Department acting for the Secretary under
a delegation of authority.
(Authority: 5 U.S.C. 504 (b)(2) and (c)(1))
Subpart B_Which Adversary Adjudications Are Covered?
Sec. 21.10 Adversary adjudications covered by the Act.
The Act covers adversary adjudications under section 554 of title 5
of the United States Code. These include the following:
(a) Compliance proceedings under title VI of the Civil Rights Act of
1964 (42 U.S.C. 2000d et seq.).
(b) Compliance and enforcement proceedings under the Age
Discrimination Act of 1975 (42 U.S.C. 6101 et seq.).
(c) Compliance proceedings under title IX of the Education
Amendments of 1972 (20 U.S.C. 1681 et seq.).
(d) Compliance proceedings under section 504 of the Rehabilitation
Act of 1973 (29 U.S.C. 794).
(e) Withholding proceedings under section 1001 of Pub. L. 100-297
(Hawkins-Stafford) (20 U.S.C. 2833).
(f) Proceedings under any of the following:
(1) Section 5(g) of Pub. L. 81-874 (Financial Assistance for Local
Educational Agencies in Areas Affected by Federal Activity) (20 U.S.C.
240(g)).
(2) Sections 6(c) or 11(a) of Pub. L. 81-815 (an act relating to the
construction
[[Page 43]]
of school facilities in areas affected by Federal activities and for
other purposes) (20 U.S.C. 636(c) or 641(a)).
(3) Section 6 of Pub. L. 95-563 (Contract Disputes Act of 1978) (41
U.S.C. 605).
(4) Part E of the General Education Provisions Act (20 U.S.C. 1234
et seq.).
(g) Other adversary adjudications that fall within the coverage of
the Act.
(Authority: 5 U.S.C. 504(c) and 554; 20 U.S.C. 1234(f)(2))
Sec. 21.11 Effect of judicial review of adversary adjudication.
If a court reviews the underlying decision of an adversary
adjudication covered under this part, an award of fees and other
expenses may be made only under 28 U.S.C. 2412 (awards in certain
judicial proceedings).
(Authority: 5 U.S.C. 504(c)(1); 28 U.S.C. 2412(d)(3))
Subpart C_How Is Eligibility Determined?
Sec. 21.20 Types of eligible applicants.
The following types of parties that prevail in adversary
adjudications are eligible to apply under the Act for an award of fees
and other expenses:
(a) An individual who has a net worth of not more than $2 million.
(b) Any owner of an unincorporated business who has--
(1) A net worth of not more than $7 million, including both personal
and business interests; and
(2) Not more than 500 employees.
(c) A charitable or other tax-exempt organization--
(1) As described in section 501(c)(3) of the Internal Revenue Code
of 1954 (26 U.S.C. 501(c)(3)); and
(2) Having not more than 500 employees.
(d) A cooperative association--
(1) As defined in section 15(a) of the Agricultural Marketing Act
(12 U.S.C. 1141(a)); and
(2) Having not more than 500 employees.
(e) Any other partnership, corporation, association, unit of local
government, or organization that has--
(1) A net worth of not more than $7 million; and
(2) Not more than 500 employees.
(Authority: 5 U.S.C. 504(b)(1)(B))
Sec. 21.21 Determination of net worth and number of employees.
(a) The adjudicative officer shall determine an applicant's net
worth and number of employees as of the date the adversary adjudication
was initiated.
(b) In determining eligibility, the adjudicative officer shall
include the net worth and number of employees of the applicant and all
of the affiliates of the applicant.
(c) For the purposes of paragraph (b) of this section, the
adjudicative officer shall consider the following as an affiliate:
(1) Any individual, corporation, or other entity that directly or
indirectly owns or controls a majority of the voting shares or other
interest of the applicant;
(2) Any corporation or other entity of which the applicant directly
or indirectly owns or controls a majority of the voting shares or other
interest; and
(3) Any entity with a financial relationship to the applicant that,
in the determination of the adjudicative officer, constitutes an
affiliation for the purposes of paragraph (b) of this section.
(d) In determining the number of employees of an applicant and its
affiliates, the adjudicative officer shall count part-time employees on
a proportional basis.
(Authority: 5 U.S.C. 504(c)(1))
Sec. 21.22 Applicants representing others.
If an applicant is a party in an adversary adjudication primarily on
behalf of one or more persons or entities that are ineligible under this
part, then the applicant is not eligible for an award.
(Authority: 5 U.S.C. 504 (b)(1)(B) and (c)(1))
Subpart D_How Does One Apply for an Award?
Sec. 21.30 Time for filing application.
(a) In order to be considered for an award under this part, an
applicant
[[Page 44]]
may file its application when it prevails in an adversary adjudication--
or in a significant and discrete substantive portion of an adversary
adjudication--but no later than 30 days after the Department's final
disposition of the adversary adjudication.
(b) In the case of a review or reconsideration of a decision in
which an applicant has prevailed or believes it has prevailed, the
adjudicative officer shall stay the proceedings on the application
pending final disposition of the underlying issue.
(c) For purposes of this part, final disposition of the adversary
adjudication means the latest of--
(1) The date on which an initial decision or other recommended
disposition of the merits of the proceeding by an adjudicative officer
becomes administratively final;
(2) The date of an order disposing of any petitions for
reconsideration of the final order in the adversary adjudication;
(3) If no petition for reconsideration is filed, the last date on
which that type of petition could have been filed; or
(4) The date of a final order or any other final resolution of a
proceeding--such as a settlement or voluntary dismissal--that is not
subject to a petition for reconsideration.
(Authority: 5 U.S.C. 504 (a)(2) and (c)(1))
Sec. 21.31 Contents of application.
(a) In its application for an award of fees and other expenses, an
applicant shall include the following:
(1) Information adequate to show that the applicant is a prevailing
party in an adversary adjudication or in a significant and discrete
substantive portion of an adversary adjudication.
(2) A statement that the adversary adjudication is covered by the
Act according to Sec. 21.10.
(3) An allegation that the position of the Department was not
substantially justified, including a description of the specific
position.
(4) Unless the applicant is a qualified tax-exempt organization or a
qualified agricultural cooperative association, information adequate to
show that the applicant qualifies under the requirements of Sec. Sec.
21.20 and 21.21 regarding net worth. The information, if applicable,
shall include a detailed exhibit of the net worth of the applicant--and
its affiliates as described in Sec. 21.21--as of the date the
proceeding was initiated.
(5)(i) The total amount of fees and expenses sought in the award;
and
(ii) An itemized statement of--
(A) Each expense; and
(B) Each fee, including the actual time expended for this fee and
the rate at which the fee was computed.
(6) A written verification under oath or affirmation or under
penalty of perjury from each attorney representing the applicant
stating--
(i) The rate at which the fee submitted by the attorney was
computed; and
(ii) The actual time expended for the fee.
(7) A written verification under oath, affirmation, or under penalty
of perjury that the information contained in the application and any
accompanying material is true and complete to the best of the
applicant's information and belief.
(b) The adjudicative officer may require the applicant to submit
additional information.
(Authority: 5 U.S.C. 504 (a)(2) and (c)(1))
Sec. 21.32 Confidentiality of information about net worth.
(a) In a proceeding on an application, the public record ordinarily
includes the information showing the net worth of the applicant.
(b) However, if an applicant objects to public disclosure of any
portion of the information and believes there are legal grounds for
withholding it from disclosure, the applicant may submit directly to the
adjudicative officer--
(1) The information the applicant wishes withheld in a sealed
envelope labeled ``Confidential Financial Information;'' and
(2) A motion to withhold the information from public disclosure.
(c) The motion must--
(1) Describe the information the applicant is requesting be
withheld; and
(2) Explain in detail--
(i) Why that information falls within one or more of the specific
exemptions from mandatory disclosure under the Freedom of Information
Act;
[[Page 45]]
(ii) Why public disclosure of the information would adversely affect
the applicant; and
(iii) Why disclosure is not required in the public interest.
(d)(1) The applicant shall serve on Department's counsel a copy of
the material referred to in paragraph (c) of this section.
(2) The applicant is not required to give a copy of that material to
any other party to the proceeding.
(e)(1) If the adjudicative officer finds that the information should
not be withheld from public disclosure, the information is placed in the
public record of the proceeding.
(2) If the adjudicative officer finds that the information should be
withheld from public disclosure, any request to inspect or copy the
information is treated in accordance with the Department's established
procedures under the Freedom of Information Act (34 CFR part 5).
(Authority: 5 U.S.C. 504(c)(1))
Sec. 21.33 Allowable fees and expenses.
(a) A prevailing party may apply for an award of fees and other
expenses incurred by the party in connection with--
(1) An adversary adjudication; or
(2) A significant and discrete substantive portion of an adversary
adjudication.
(b) If a proceeding includes issues covered by the Act and issues
excluded from coverage, the applicant may apply only for an award of
fees and other expenses related to covered issues.
(c) Allowable fees and expenses include the following, as
applicable:
(1) An award of fees based on rates customarily charged by
attorneys, agents, and expert witnesses.
(2) An award for the reasonable expenses of the attorney, agent, or
expert witness as a separate item if the attorney, agent, or expert
witness ordinarily charges clients separately for those expenses.
(3) The cost of any study, analysis, engineering report, test, or
project related to the preparation of the applicant's case in the
adversary adjudication.
(d) The calculation of fees and expenses as provided for under
paragraph (c) of this section shall be in accordance with the standards
for awards as described in Sec. 21.50(a) through (c).
(Authority: 5 U.S.C. 504(a)(1), (b)(1)(A) and (c)(1))
Subpart E_What Procedures Are Used in Considering Applications?
Sec. 21.40 Filing and service of documents.
(a) Except as provided in Sec. 21.32 and in applications subject to
the jurisdiction of the CRRA, an applicant shall--
(1) File with the adjudicative officer its application and any
related documents; and
(2) Serve on all parties to the adversary adjudication copies of its
application and any related documents.
(b)(1) In an application subject to the jurisdiction of the CRRA,
the applicant shall--
(i) File with the CRRA its application and any other related
documents; and
(ii) Serve on all parties to the adversary adjudication copies of
its application and any related documents.
(2) In applications subject to Sec. 21.40(b)(1), the CRRA shall
direct the adjudicative officer to issue an initial decision within 30
days of the completion of the proceedings on the application. The
adjudicative officer shall conduct proceedings under the procedures of
Sec. Sec. 21.41-21.44.
(Authority: 5 U.S.C. 504(a)(2) and (c)(1); 20 U.S.C. 1681; 29 U.S.C.
794; 42 U.S.C. 2000d-1 et seq. and 6101 et seq.)
Sec. 21.41 Answer to application.
(a)(1) Within 30 days after receiving an application for an award
under this part, the Department's counsel may file an answer to the
application.
(2) The Department's counsel may request an extension of time for
filing the Department's answer.
(3) The adjudicative officer shall grant the request for an
extension if the Department's counsel shows good cause for the request.
(b)(1) The Department's answer must--
[[Page 46]]
(i) Explain any objections to the award requested; and
(ii) Identify the facts relied on in support of the position of the
Department.
(2) If the answer is based on any alleged facts not in the record of
the adversary adjudication, the Department's counsel shall include with
the answer either--
(i) Supporting affidavits; or
(ii) A request for further proceedings under Sec. 21.44.
(c)(1) If the Department's counsel and the applicant believe that
the issues in the application can be settled, they may jointly file a
statement of their intent to negotiate a settlement.
(2)(i) The filing of a statement of an intent to negotiate extends
the time for filing an answer for 30 days.
(ii) The adjudicative officer shall grant further extensions if the
Department's counsel and the applicant jointly request those extensions.
(Authority: 5 U.S.C. 504(c)(1))
Sec. 21.42 Reply.
(a) Within 15 days after receiving an answer, an applicant may file
a reply.
(b) If the applicant's reply is based on any alleged facts not in
the record of the adversary adjudication, the applicant shall include
with the reply either--
(1) Supporting affidavits; or
(2) A request for further proceedings under Sec. 21.44.
(Authority: 5 U.S.C. 504(c)(1))
Sec. 21.43 Comments by other parties.
(a) Any party to a proceeding, other than an applicant or the
Department's counsel, may file comments on--
(1) The application within 30 days after the applicant files the
application;
(2) The answer within 30 days after the counsel files the answer; or
(3) Both, if the comments are filed within the time period specified
in paragraphs (a)(1) and (a)(2) of this section.
(b) The commenting party may not participate further in proceedings
on the application unless the adjudicative officer determines that
further participation is necessary to permit full exploration of matters
raised in the comments.
(Authority: 5 U.S.C. 504(c)(1))
Sec. 21.44 Further proceedings.
(a) The adjudicative officer shall make the determination of an
award on the basis of the written record.
(b)(1) However, the adjudicative officer may order further
proceedings on his or her own initiative or at the request of the
applicant or the Department's counsel.
(2) The adjudicative officer may order further proceedings only if
he or she determines that those proceedings are necessary for full and
fair resolution of issues arising from the application.
(3) If further proceedings are ordered, the adjudicative officer
shall determine the scope of those proceedings, which may include such
proceedings as informal conferences, oral arguments, additional written
submissions, discovery, or an evidentiary hearing.
(4) An adjudicative officer may not order discovery or an
evidentiary hearing for the issue of whether or not the Department's
position was substantially justified.
(c) If the applicant or the Department's counsel requests the
adjudicative officer to order further proceedings, the request must--
(1) Specify the information sought or the disputed issues; and
(2) Explain why the additional proceedings are necessary to obtain
that information or resolve those issues.
(Authority: 5 U.S.C. 504(a)(3) and (c)(1))
Subpart F_How Are Awards Determined?
Sec. 21.50 Standards for awards.
(a) In determining the reasonableness of the amount sought as an
award of fees and expenses for an attorney, agent, or expert witness,
the adjudicative officer shall consider one or more of the following:
(1)(i) If the attorney, agent, or expert witness is in private
practice, his or her customary fee for similar services; or
[[Page 47]]
(ii) If the attorney, agent, or expert witness is an employee of the
applicant, the fully allocated cost of the services.
(2) The prevailing rate for similar services in the community in
which the attorney, agent, or expert witness ordinarily performs
services.
(3) The time the attorney, agent, or expert witness actually spent
on the applicant's behalf with respect to the adversary adjudication.
(4) The time the attorney, agent, or expert witness reasonably spent
in light of the difficulty or complexity of the covered issues in the
adversary adjudication.
(5) Any other factors that may bear on the value of the services
provided by the attorney, agent, or expert witness.
(b) The adjudicative officer may not grant--
(1) An award for the fee of an attorney or agent in excess of $75.00
per hour; or
(2) An award to compensate an expert witness in excess of the
highest rate at which the Department pays expert witnesses.
(c) The adjudicative officer may also determine whether--
(1) Any study, analysis, engineering report, text, or project for
which the applicant seeks an award was necessary for the preparation of
the applicant's case in the adversary adjudication; and
(2) The costs claimed by the applicant for this item or items are
reasonable.
(d) The adjudicative officer may not make an award to an eligible
party if the adjudicative officer, the CRRA, or the Secretary on review
finds that, based on a review of the administrative record as a whole--
(1) The position of the Department, as defined in Sec. 21.3, was
substantially justified; or
(2) Special circumstances make an award unjust.
(e) The adjudicative officer may reduce or deny an award to the
extent that the applicant engaged in conduct that unduly or unreasonably
protracted the adversary adjudication.
(f) If an applicant is entitled to an award because the applicant
prevailed over another agency of the United States that participated in
a proceeding before the Department and that agency's position was not
substantially justified, the adjudicative officer shall determine
whether to make the award, or an appropriate portion of the award,
against that agency. For the purpose of this determination, the
requirements of this subpart apply.
(Authority: 5 U.S.C. 504(a), (b)(1)(A), and (b)(1)(E))
Sec. 21.51 Initial decision in applications not subject to the CRRA.
(a) In applications not subject to the jurisdiction of the CRRA, the
adjudicative officer shall issue an initial decision on an application
within 30 days after completion of proceedings on the application.
(b) The initial decision must include the following:
(1) Written findings, including sufficient supporting explanation,
on--
(i) The applicant's status as a prevailing party;
(ii) The applicant's eligibility;
(iii) Whether the position of the Department was substantially
justified;
(iv) Whether special circumstances make an award unjust;
(v) If applicable, whether the applicant engaged in conduct that
unduly or unreasonably protracted the adversary adjudication; and
(vi) Other factual issues raised in the adversary adjudication.
(2) A statement of the amount awarded, including an explanation--
with supporting information--for any difference between the amount
requested by the applicant and the amount awarded.
(3) A statement of the applicant's right to request review by the
Secretary under Sec. 21.54.
(4) A statement of the applicant's right under Sec. 21.56 to seek
judicial review of the final award determination.
(c) The explanation referred to in paragraph (b)(2) of this section
may include--
(1) Whether the amount requested was reasonable; and
(2) The extent to which the applicant unduly or unreasonably
protracted the adversary adjudication.
(Authority: 5 U.S.C. 504 (a)(3) and (c))
[[Page 48]]
Sec. 21.52 Initial decision by an adjudicative officer in applications
subject to CRRA jurisdiction.
(a) If the application is subject to the jurisdiction of the CRRA,
the adjudicative officer shall issue the initial decision within 30 days
after completion of the proceedings.
(b) The initial decision must include the information required under
Sec. 21.51(b). However, instead of the information required under Sec.
21.51(b)(3), the initial decision must inform the applicant of--
(1) Its right to request review by the CRRA; and
(2) Its right to request review by the Secretary of the CRRA's final
decision.
(c) If the applicant or the Department's counsel appeals the
adjudicative officer's initial decision, the appeal must be submitted to
the CRRA, in writing, within 30 days after the initial decision is
issued.
(d) If the applicant or the Department's counsel does not appeal the
adjudicative officer's initial decision to the CRRA and the Secretary
does not decide to review the initial decision under Sec. 21.54(a), the
initial decision becomes the Department's final decision 60 days after
it is issued by the officer.
(Authority: 5 U.S.C. 504(b)(1)(C); 20 U.S.C. 1681; 29 U.S.C. 794; 42
U.S.C. 2000d-1 et seq. and 6101 et seq.)
Sec. 21.53 Final decision of the CRRA.
(a) In an application subject to the jurisdiction of the CRRA, the
CRRA shall, within 30 days after receipt of the written appeal--
(1) Issue a final decision on the appeal of the adjudicative
officer's initial decision; or
(2) Remand the application to the adjudicative officer for further
proceedings.
(b) The CRRA shall review the initial decision on the basis of the
written record of the proceedings on the application. This includes but
is not limited to--
(1) The written request; and
(2) The adjudicative officer's findings as described in Sec.
21.51(b).
(c) The CRRA shall act on the review by either--
(1) Issuing a final decision on the application; or
(2) Remanding the application to the adjudicative officer for
further proceedings.
(d) If the CRRA issues a final decision, the CRRA's decision must
include--
(1) Written findings, including supporting explanation, on--
(i) The applicant's status as a prevailing party;
(ii) The applicant's eligibility;
(iii) Whether the position of the Department was substantially
justified;
(iv) Whether special circumstances make an award unjust;
(v) Whether the applicant engaged in conduct that unduly or
unreasonably protracted the adversary adjudication; and
(vi) Other factual issues raised in the adversary adjudication.
(2) A statement of the amount awarded, including an explanation--
with supporting information--for any difference between the amount
requested by the applicant and the amount awarded.
(3) A statement of the applicant's right to request review by the
Secretary under Sec. 21.54.
(4) A statement of the applicant's right under Sec. 21.56 to seek
judicial review of the final award determination.
(e) The explanation referred to in paragraph (d)(2) of this section
may include--
(1) Whether the amount requested was reasonable; and
(2) The extent to which the applicant unduly or unreasonably
protracted the adversary adjudication.
(Authority: 5 U.S.C. 301, 557 (b) and (c); 20 U.S.C. 1681 and 3401 et
seq.; 29 U.S.C. 794; 42 U.S.C. 2000d-1 et seq. and 6101 et seq.)
Sec. 21.54 Review by the Secretary.
(a) The Secretary may decide to review--
(1) An initial decision made by an adjudicative officer in a
proceeding not subject to CRRA review;
(2) An initial decision made by an adjudicative officer in a
proceeding subject to CRRA review that was not appealed to the CRRA; or
(3) A final decision made by the CRRA under Sec. 21.53.
[[Page 49]]
(b)(1) The Secretary does not review a final decision made by an
adjudicative officer of the General Services Administration Board of
Contract Appeals.
(2) The Secretary or a party to the proceedings may seek
reconsideration of the final decision by an adjudicative officer of the
General Services Administration Board of Contract Appeals on the fee
application in accordance with 48 CFR 6101.32.
(c) The Secretary decides to review a decision under Sec. 21.54(a)
either--
(1) Upon receipt of a written request for review by an applicant or
Department's counsel; or
(2) Upon the Secretary's own motion.
(d) If the applicant or the Department's counsel seeks a review, the
request must be submitted to the Secretary, in writing, within 30 days
of--
(1) An initial decision in a proceeding not subject to CRRA review;
or
(2) A final decision of the CRRA.
(e) The Secretary decides whether to accept or reject a request for
review of an initial decision made by the adjudicative officer in a
proceeding not subject to CRRA review or a final decision of the CRRA
within 30 days after receipt of a request for review.
(f) The Secretary may decide on his own motion to review a decision
made under Sec. 21.54(a) within 60 days of the initial decision by the
adjudicative officer or a final decision of the CRRA.
(g) If the Secretary decides to review the adjudicative officer's
initial decision or the CRRA's final decision--
(1) The Secretary reviews the adjudicative officer's initial
decision or the CRRA's final decision on the basis of the written record
of the proceedings on the application. This includes, but is not
restricted to--
(i) The written request for review;
(ii) The adjudicative officer's findings as described in Sec.
21.51(b); and
(iii) If applicable, the final decision of the CRRA, if any; and
(2) The Secretary either--
(i) Issues a final decision; or
(ii) Remands the application to the adjudicative officer or the CRRA
for further proceedings.
(h) If the Secretary issues a final decision, the Secretary's
decision--
(1) Is in writing;
(2) States the reasons for the decision; and
(3) If the decision is adverse to the applicant, advises the
applicant of its right to petition for judicial review under Sec.
21.56.
(Authority: 5 U.S.C. 557 (b) and (c))
Sec. 21.55 Final decision if the Secretary does not review.
If the Secretary takes no action under Sec. 21.54--
(a) The adjudicative officer's initial decision on the application
becomes the Department's final decision 60 days after it is issued by
the adjudicative officer; or
(b) The CRRA's decision on the application becomes the Department's
final decision 60 days after it is issued by the CRRA.
(Authority: 5 U.S.C. 301)
Sec. 21.56 Judicial review.
If the applicant is dissatisfied with the award determination in the
final decision under Sec. Sec. 21.52-21.55, the applicant may seek
judicial review of that determination under 5 U.S.C. 504(c)(2) within 30
days after that determination was made.
(Authority: 5 U.S.C. 504(c)(2))
Subpart G_How Are Awards Paid?
Sec. 21.60 Payment of awards.
To receive payment, an applicant granted an award under the Act must
submit to the Financial Management Service of the Department--
(a) A request for payment signed by the applicant or its duly
authorized agent;
(b) A copy of the final decision granting the award; and
(c) A statement that--
(1) The applicant will not seek review of the decision in the United
States courts; or
(2) The process for seeking review of the award has been completed.
(Authority: 5 U.S.C. 504(c)(1) and (d))
Sec. 21.61 Release.
If an applicant, its agent, or its attorney accepts payment of any
award
[[Page 50]]
or settlement in conjunction with an application under this part, that
acceptance--
(a) Is final and conclusive with respect to that application; and
(b) Constitutes a complete release of any further claim against the
United States with respect to that application.
(Authority: 5 U.S.C. 504(c)(1))
PART 30_DEBT COLLECTION--Table of Contents
Subpart A_General
Sec.
30.1 What administrative actions may the Secretary take to collect a
debt?
30.2 On what authority does the Secretary rely to collect a debt under
this part?
Subpart B [Reserved]
Subpart C_What Provisions Apply to Administrative Offset?
General Offset Procedures
30.20 To what do Sec. Sec. 30.20-30.31 apply?
30.21 When may the Secretary offset a debt?
30.22 What notice does the debtor receive before the commencement of
offset?
30.23 How must a debtor request an opportunity to inspect and copy
records relating to a debt?
30.24 What opportunity does the debtor receive to obtain a review of the
existence or amount of a debt?
30.25 How may a debtor obtain an oral hearing?
30.26 What special rules apply to an oral hearing?
30.27 When does the Secretary enter into a repayment agreement rather
than offset?
30.28 When may the Secretary offset before completing the procedures
under Sec. Sec. 30.22-30.27?
30.29 What procedures apply when the Secretary offsets to collect a debt
owed another agency?
30.30 What procedures apply when the Secretary requests another agency
to offset a debt owed under a program or activity of the
Department?
30.31 How does the Secretary apply funds recovered by offset if multiple
debts are involved?
IRS Tax Refund Offset Procedures
30.33 What procedures does the Secretary follow for IRS tax refund
offsets?
Procedures for Reporting Debts to Consumer Reporting Agencies
30.35 What procedures does the Secretary follow to report debts to
consumer reporting agencies?
Subpart D [Reserved]
Subpart E_What Costs and Penalties Does the Secretary Impose on
Delinquent Debtors?
30.60 What costs does the Secretary impose on delinquent debtors?
30.61 What penalties does the Secretary impose on delinquent debtors?
30.62 When does the Secretary forego interest, administrative costs, or
penalties?
Subpart F_What Requirements Apply to the Compromise of a Debt or the
Suspension or Termination of Collection Action?
30.70 How does the Secretary exercise discretion to compromise a debt or
to suspend or terminate collection of a debt?
Subpart G [Reserved]
Authority: 20 U.S.C. 1221e-3(a)(1), and 1226a-1, 31 U.S.C. 3711(e),
31 U.S.C. 3716(b) and 3720A, unless otherwise noted.
Source: 51 FR 24099, July 1, 1986, unless otherwise noted.
Subpart A_General
Sec. 30.1 What administrative actions may the Secretary take to
collect a debt?
(a) The Secretary may take one or more of the following actions to
collect a debt owed to the United States:
(1) Collect the debt under the procedures authorized in the
regulations in this part.
(2) Refer the debt to the General Accounting Office for collection.
(3) Refer the debt to the Department of Justice for compromise,
collection, or litigation.
(4) Take any other action authorized by law.
(b) In taking any of the actions listed in paragraph (a) of this
section, the Secretary complies with the requirements of the Federal
Claims Collection Standards (FCCS) at 4 CFR parts 101-105 that are not
inconsistent with the requirements of this part.
(c) The Secretary may--
[[Page 51]]
(1) Collect the debt under the offset procedures in subpart C of
this part;
(2) Report a debt to a consumer reporting agency under the
procedures in subpart C of this part;
(3) Charge interest on the debt as provided in the FCCS;
(4) Impose upon a debtor a charge based on the costs of collection
as determined under subpart E of this part;
(5) Impose upon a debtor a penalty for failure to pay a debt when
due under subpart E of this part;
(6) Compromise a debt, or suspend or terminate collection of a debt,
under subpart F of this part;
(7) Take any other actions under the procedures of the FCCS in order
to protect the United States Government's interests; or
(8) Use any combination of the procedures listed in this paragraph
(c) as may be appropriate in a particular case.
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3711(e))
[53 FR 33425, Aug. 30, 1988]
Sec. 30.2 On what authority does the Secretary rely to collect a debt
under this part?
(a)(1) The Secretary takes an action referred to under Sec. 30.1(a)
in accordance with--
(i) 31 U.S.C. chapter 37, subchapters I and II;
(ii) Other applicable statutory authority; or
(iii) The common law.
(2) If collection of a debt in a particular case is not authorized
under one of the authorities described in paragraph (a)(1) of this
section, the Secretary may collect the debt under any other available
authority under which collection is authorized.
(b) The Secretary does not use a procedure listed in Sec. 30.1(c)
to collect a debt, or a certain type of debt, if--
(1) The procedure is specifically prohibited under a Federal
statute; or
(2) A separate procedure other than the procedure described under
Sec. 30.1(c) is specifically required under--
(i) A contract, grant, or other agreement;
(ii) A statute other than 31 U.S.C. 3716; or
(iii) Other regulations.
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3711(e))
[53 FR 33425, Aug. 30, 1988]
Subpart B [Reserved]
Subpart C_What Provisions Apply to Administrative Offset?
General Offset Procedures
Sec. 30.20 To what do Sec. Sec. 30.20-30.31 apply?
(a)(1)(i) Sections 30.20-30.31 establish the general procedures used
by the Secretary to collect debts by administrative offset.
(ii) The Secretary uses the procedures established under other
regulations, including Sec. 30.33, What procedures does the Secretary
follow for IRS tax refund offsets?, 34 CFR part 31, Salary Offset for
Federal Employees Who Are Indebted to the United States Under Programs
Administrated by the Secretary of Education, and 34 CFR part 32, Salary
Offset to Recover Overpayments of Pay or Allowances from Department of
Education Employees, if the conditions requiring application of those
special procedures exists.
(2) The word ``offset'' is used in this subpart to refer to the
collection of a debt by administrative offset.
(b) The Secretary does not rely on 31 U.S.C. 3716 as authority for
offset if:
(1) The debt is owed by a State or local government;
(2) The debt, or the payment against which offset would be taken,
arises under the Social Security Act;
(3) The debt is owed under:
(i) The Internal Revenue Code of 1954; or
(ii) The tariff laws of the United States; or
(4) The right to collect the debt first accrued more than ten years
before initiation of the offset.
(c)(1) The Secretary may rely on 31 U.S.C. 3716 as authority for
offset of a debt to which paragraph (b)(4) of this section would
otherwise apply if facts material to the Government's right to collect
the debt were not known and could not reasonably have been known
[[Page 52]]
by the official or officials of the Government who are charged with the
responsibility to discover and collect the debt.
(2) If paragraph (c)(1) of this section applies, the Secretary may
rely on 31 U.S.C. 3716 as authority for offset up to 10 years after the
date that the official or officials described in that paragraph first
knew or reasonably should have known of the right of the United States
to collect the debt.
(d) The Secretary determines when the right to collect a debt first
accrued under the existing law regarding accrual of debts such as 28
U.S.C. 2415.
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))
[51 FR 24099, July 1, 1986, as amended at 51 FR 35646, Oct. 7, 1986; 53
FR 33425, Aug. 30, 1988; 54 FR 43583, Oct. 26, 1989]
Sec. 30.21 When may the Secretary offset a debt?
(a) The Secretary may offset a debt if:
(1) The debt is liquidated or certain in amount; and
(2) Offset is feasible and not otherwise prohibited.
(b)(1) Whether offset is feasible is determined by the Secretary in
the exercise of sound discretion on a case-by-case basis, either:
(i) For each individual debt or offset; or
(ii) For each class of similar debts or offsets.
(2) The Secretary considers the following factors in making this
determination:
(i) Whether offset can be practically and legally accomplished.
(ii) Whether offset will further and protect the interests of the
United States.
(c) The Secretary may switch advance funded grantees to a
reimbursement payment system before initiating an offset.
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))
Sec. 30.22 What notice does the debtor receive before the commencement
of offset?
(a)(1) Except as provided in Sec. Sec. 30.28 and 30.29, the
Secretary provides a debtor with written notice of the Secretary's
intent to offset before initiating the offset.
(2) The Secretary mails the notice to the debtor at the current
address of the debtor, as determined by the Secretary from information
regarding the debt maintained by the Department.
(b) The written notice informs the debtor regarding:
(1) The nature and amount of the debt;
(2) The Secretary's intent to collect the debt by offset;
(3) The debtor's opportunity to:
(i) Inspect and copy Department records pertaining to the debt;
(ii) Obtain a review within the Department of the existence or
amount of the debt; and
(iii) Enter into a written agreement with the Secretary to repay the
debt;
(4) The date by which the debtor must request an opportunity set
forth under paragraph (b)(3) of this section; and
(5) The Secretary's decision, in appropriate cases, to switch the
debtor from advance funding to a reimbursement payment system.
(c)(1) In determining whether a debtor has requested an opportunity
set forth under paragraph (b)(3) of this section in a timely manner, the
Secretary relies on:
(i) A legibly dated U.S. Postal Service postmark for the debtor's
request; or
(ii) A legibly stamped U.S. Postal service mail receipt for debtor's
request.
(2) The Secretary does not rely on either of the following as proof
of mailing;
(i) A private metered postmark.
(ii) A mail receipt that is not dated by the U.S. Postal Service.
Note: The U.S. Postal Service does not uniformly provide a dated
postmark. Before relying on this method for proof of mailing, a debtor
should check with its local post office.
(d) If a debtor previously has been notified of the Secretary's
intent to offset or offered an opportunity to take any of the actions
set forth in paragraph (b)(3) of this section in connection with the
same debt, the Secretary may offset without providing the debtor with
[[Page 53]]
an additional notice of intent or opportunity to take any of those
actions under these offset procedures.
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))
Sec. 30.23 How must a debtor request an opportunity to inspect and
copy records relating to a debt?
(a) If a debtor wants to inspect and copy Department documents
relating to the debt, the debtor must:
(1) File a written request to inspect and copy the documents within
20 days after the date of the notice provided under Sec. 30.22; and
(2) File the request at the address specified in that notice.
(b) A request filed under paragraph (a) of this section must
contain:
(1) All information provided to the debtor in the notice under Sec.
30.22 or Sec. 30.33(b) that identifies the debtor and the debt,
including the debtor's Social Security number and the program under
which the debt arose, together with any corrections of that identifying
information; and
(2) A reasonably specific identification of the records the debtor
wishes to have available for inspection and copying.
(c) The Secretary may decline to provide an opportunity to inspect
and copy records if the debtor fails to request inspection and copying
in accordance with this section.
(Approved by the Office of Management and Budget under control number
1880-0515)
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))
[51 FR 24099, July 1, 1986, as amended at 51 FR 35646, Oct. 7, 1986]
Sec. 30.24 What opportunity does the debtor receive to obtain a
review of the existence or amount of a debt?
(a) If a debtor wants a review within the Department of the issues
identified in the notice under Sec. 30.22(b)(3)(ii) or Sec.
30.33(b)(3)(ii), the debtor must:
(1) File a request for review within 20 days after the date of the
notice provided under Sec. 30.22; and
(2) File a request at the address specified in that notice.
(b) A request filed under paragraph (a) of this section must
contain:
(1) All information provided to the debtor in the notice under Sec.
30.22 or Sec. 30.33(b) that identifies the debtor and the particular
debt, including the debtor's Social Security number and the program
under which the debt arose, together with any corrections of that
identifying information; and
(2) An explanation of the reasons the debtor believes that the
notice the debtor received under Sec. 30.22 or Sec. 30.33(b)
inaccurately states any facts or conclusions relating to the debt.
(c) The Secretary may decline to provide an opportunity for review
of a debt if the debtor fails to request the review in accordance with
this section.
(d)(1) The debtor shall:
(i) File copies of any documents relating to the issues identified
in the notice under Sec. 30.22(b)(3)(ii) or Sec. 30.33(b)(3)(ii) that
the debtor wishes the Secretary to consider in the review;
(ii) File the documents at the address specified in that notice, and
(iii) File the documents no later than:
(A) 20 days after the date of the notice provided under Sec. 30.22;
or
(B) If the debtor has requested an opportunity to inspect and copy
records under Sec. 30.23 within the time period specified in that
section, 15 days after the date on which the Secretary makes available
to the debtor the relevant, requested records.
(2) The Secretary may decline to consider any reasons or documents
that the debtor fails to provide in accordance with paragraphs (b) and
(d) of this section.
(e) If the Secretary bases the review on only the documentary
evidence, the Secretary:
(1) Reviews the documents submitted by the debtor and other relevant
evidence; and
(2) Notifies the debtor in writing of the Secretary's decision
regarding the issues identified in the notice under Sec.
30.22(b)(3)(ii) or Sec. 30.33(b)(3)(ii) and, if
[[Page 54]]
appropriate, the question of waiver of the debt.
(Approved by the Office of Management and Budget under control number
1880-0515)
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))
[51 FR 24099, July 1, 1986, as amended at 51 FR 35647, Oct. 7, 1986]
Sec. 30.25 How may a debtor obtain an oral hearing?
(a) If a debtor wants the Secretary to conduct the review requested
under Sec. 30.24 as an oral hearing, the debtor must file a written
request for an oral hearing together with the request for review filed
under Sec. 30.24(a).
(b) A request filed under paragraph (a) of this section must contain
the following in addition to the information filed under Sec. 30.24(b):
(1) An explanation of reason(s) why the debtor believes the
Secretary cannot resolve the issues identified in the notice under Sec.
30.22(b)(3)(ii) or Sec. 30.33(b)(3)(ii) through a review of the
documentary evidence.
(2) An identification of:
(i) The individuals that the debtor wishes to have testify at the
oral hearing;
(ii) The specific issues identified in the notice regarding which
each individual is prepared to testify; and
(iii) The reasons why each individual's testimony is necessary to
resolve the issue.
(c) The Secretary grants a debtor's request for an oral hearing
regarding the issues identified in the notice under Sec.
30.22(b)(3)(ii) or Sec. 30.33(b)(3)(ii) only if:
(1)(i) A statute authorizes or requires the Secretary to consider
waiver of the indebtedness involved;
(ii) The debtor files a request for waiver of the indebtedness with
the request for review filed under paragraph (a)(1) of this section; and
(iii) The question of waiver of the indebtedness turns on an issue
of credibility or veracity; or
(2) The Secretary determines that the issues identified in the
notice under Sec. 30.22(b)(3)(ii) or Sec. 30.33(b)(3)(ii) cannot be
resolved by review of only the documentary evidence.
(d) Notwithstanding paragraph (b) of this section, the Secretary may
deny oral hearings for a class of similar debts if:
(1) The issues identified in the notice under Sec. 30.22(b)(3)(ii)
or 30.33(b)(3)(ii) for which an oral hearing was requested, or the issue
of waiver, rarely involve issues of credibility or veracity; and
(2) The Secretary determines that review of the documentary evidence
is ordinarily an adequate means to correct mistakes.
(e) The Secretary may decline to consider any reasons that the
debtor fails to provide in accordance with paragraph (b)(1) of this
section.
(Approved by the Office of Management and Budget under control number
1880-0515)
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))
[51 FR 24099, July 1, 1986, as amended at 51 FR 35647, Oct. 7, 1986]
Sec. 30.26 What special rules apply to an oral hearing?
(a) The oral hearing under Sec. 30.25 is not a formal evidentiary
hearing subject to 5 U.S.C. 554, unless required by law.
(b) If the Secretary grants an oral hearing, the Secretary notifies
the debtor in writing of:
(1) The time and place for the hearing;
(2) The debtor's right to representation; and
(3) The debtor's right to present and cross examine witnesses.
(c) If the Secretary grants an oral hearing, the Secretary
designates an official to:
(1) Govern the conduct of the hearing;
(2) Take all necessary action to avoid unreasonable delay in the
proceedings;
(3) Review the evidence presented at the hearing, the documents
submitted by the debtor, and other relevant evidence; and
(4) After considering the evidence, notify the debtor in writing of
the official's decision regarding the issues identified in the notice
under Sec. 30.22(b)(3)(ii) or Sec. 30.33(b)(3)(ii) and, if
appropriate, the question of waiver of the debt.
[[Page 55]]
(d) The official designated under paragraph (c) of this section may
decline to hear any witnesses or testimony not identified by the debtor
in accordance with Sec. 30.25(b)(2).
(e) The decision of the designated official under paragraph (c) of
this section constitutes the final decision of the Secretary.
(Authority: 20 U.S.C. 1221-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))
Sec. 30.27 When does the Secretary enter into a repayment agreement
rather than offset?
(a) If a debtor wants an opportunity to enter into a written
agreement to repay a debt on terms acceptable to the Secretary, the
debtor must:
(1) File a request to enter into such agreement within 20 days after
the date of the notice provided under Sec. 30.22; and
(2) File the request at the address specified in the notice.
(b) A request filed under paragraph (a) of this section must contain
all information provided to the debtor in the notice under Sec. 30.22
or Sec. 30.33(b) that identifies the debtor and the debt, including the
debtor's Social Security number and the program under which the debt
arose, together with any corrections of that identifying information.
(c) If the Secretary receives a request filed in accordance with
this section, the Secretary may enter into a written agreement requiring
repayment in accordance with 4 CFR 102.11, instead of offsetting the
debt.
(d) In deciding whether to enter into the agreement, the Secretary
may consider:
(1) The Government's interest in collecting the debt; and
(2) Fairness to the debtor.
(e)(1) A debtor that enters into a repayment agreement with the
Secretary under this section waives any right to further review by the
Secretary of the issues relating to the original debt identified in the
notice under Sec. 30.22(b)(3)(ii) or Sec. 30.33(b)(3)(ii).
(2) If a debtor breaches a repayment agreement, the Secretary may
offset, or, under Sec. 30.30, refer to another agency for offset:
(i) The amount owing under the agreement; or
(ii) The entire original debt, to the extent not repaid.
(Authority: 20 U.S.C. 1221-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))
[51 FR 24099, July 1, 1986, as amended at 51 FR 35647, Oct. 7, 1986]
Sec. 30.28 When may the Secretary offset before completing the
procedures under Sec. Sec. 30.22-30.27?
(a) The Secretary may offset before completing the procedures
otherwise required by Sec. Sec. 30.22-30.27 if:
(1) Failure to offset would substantially prejudice the Government's
ability to collect the debt; and
(2) The amount of time remaining before the payment by the United
States which is subject to offset does not reasonably permit completion
of the procedures under Sec. Sec. 30.22-30.27.
(b) If the Secretary offsets under paragraph (a) of this section,
the Secretary:
(1) Promptly completes the procedures under Sec. Sec. 30.22-30.27
after initiating the offset; and
(2) Refunds any amounts recovered under the offset that are later
found not to be owed to the United States.
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))
Sec. 30.29 What procedures apply when the Secretary offsets to
collect a debt owed another agency?
The Secretary may initiate offset to collect a debt owed another
Federal agency if:
(a) An official of that agency certifies in writing:
(1) That the debtor owes a debt to the United States;
(2) The amount of the debt; and
(3) That the agency has complied with 4 CFR 102.3; and
(b) For offsets under 31 U.S.C. 3716, the Secretary makes an
independent determination that the offset meets the standards under
Sec. 30.21(a)(2).
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))
[[Page 56]]
Sec. 30.30 What procedures apply when the Secretary requests another
agency to offset a debt owed under a program or activity of the
Department?
(a) The Secretary may request another Federal agency to offset a
debt owed under a program or activity of the Department if the Secretary
certifies in writing to the other Federal agency:
(1) That the debtor owes a debt to the United States;
(2) The amount of the debt; and
(3) That the Secretary has complied with 4 CFR 102.3.
(b) Before providing the certification required under paragraph (a)
of this section, the Secretary complies with the procedures in
Sec. Sec. 30.20-30.27.
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))
Sec. 30.31 How does the Secretary apply funds recovered by offset if
multiple debts are involved?
If the Secretary collects more than one debt of a debtor by
administrative offset, the Secretary applies the recovered funds to
satisfy those debts based on the Secretary's determination of the best
interests of the United States, determined by the facts and
circumstances of the particular case.
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))
IRS Tax Refund Offset Procedures
Sec. 30.33 What procedures does the Secretary follow for IRS tax
refund offsets?
(a) If a named person owes a debt under a program or activity of the
Department, the Secretary may refer the debt for offset to the Secretary
of the Treasury after complying with the procedures in Sec. Sec. 30.20-
30.28, as modified by this section.
(b) Notwithstanding Sec. 30.22(b), the notice sent to a debtor
under Sec. 30.22 informs the debtor that:
(1) The debt is past due;
(2) The Secretary intends to refer the debt for offset to the
Secretary of Treasury;
(3) The debtor has an opportunity to:
(i) Inspect and copy Department records regarding the existence,
amount, enforceability, or past-due status of the debt;
(ii) Obtain a review within the Department of the existence, amount,
enforceability, or past-due status of the debt;
(iii) Enter into a written agreement with the Secretary to repay the
debt; and
(4) The debtor must take an action set forth under paragraph (b)(3)
by a date specified in the notice.
(c) Notwithstanding Sec. 30.23(a), if a debtor wants to inspect and
copy Department records regarding the existence, amount, enforceability,
or past-due status of the debt, the debtor must:
(1) File a written request to inspect and copy the records within 20
days after the date of the notice provided under Sec. 30.22; and
(2) File the request at the address specified in that notice.
(d) Notwithstanding the time frame under Sec. 30.24(a), if a debtor
wants a review under that paragraph, the debtor must file a request for
review at the address specified in the notice by the later of:
(1) Sixty-five days after the date of the notice provided under
Sec. 30.22;
(2) If the debtor has requested an opportunity to inspect and copy
records within the time period specified in paragraph (c) of this
section, 15 days after the date on which the Secretary makes available
to the debtor the relevant, requested records; or
(3) If the debtor has requested a review within the appropriate time
frame under paragraph (d) (1) or (2) of this section and the Secretary
has provided an initial review by a guarantee agency, seven days after
the date of the initial determination by the guarantee agency.
(e) Notwithstanding the time frames under Sec. 30.24(d), a debtor
shall file the documents specified under that paragraph with the request
for review.
(f) Notwithstanding the time frame under Sec. 30.27(a), a debtor
must agree to repay the debt under terms acceptable to the Secretary and
make the first payment due under the agreement by the latest of:
(1) The seventh day after the date of decision of the Secretary if
the debtor requested a review under Sec. 30.24;
[[Page 57]]
(2) The sixty-fifth day after the date of the notice under Sec.
30.22(b), if the debtor did not request a review under Sec. 30.24, or
an opportunity to inspect and copy records of the Department under Sec.
30.23; or
(3) The fifteenth day after the date on which the Secretary made
available relevant records regarding the debt, if the debtor filed a
timely request under Sec. 30.23(a).
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3720A)
Procedures for Reporting Debts to Consumer Reporting Agencies
Sec. 30.35 What procedures does the Secretary follow to report debts
to consumer reporting agencies?
(a)(1) The Secretary reports information regarding debts arising
under a program or activity of the Department and held by the Department
to consumer reporting agencies, in accordance with the procedures
described in this section.
(2) The term consumer reporting agency, as used in this section, has
the same meaning as provided in 31 U.S.C. 3701(a)(3).
(b) Before reporting information on a debt to a consumer reporting
agency, the Secretary follows the procedures set forth in Sec. 30.33.
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3711, Sec.
16023, 16029, Pub. L. 99-272)
Subpart D [Reserved]
Subpart E_What Costs and Penalties Does the Secretary Impose on
Delinquent Debtors?
Source: 53 FR 33425, Aug. 30, 1988, unless otherwise noted.
Sec. 30.60 What costs does the Secretary impose on delinquent debtors?
(a) The Secretary may charge a debtor for the costs associated with
the collection of a particular debt. These costs include, but are not
limited to--
(1) Salaries of employees performing Federal loan servicing and debt
collection activities;
(2) Telephone and mailing costs;
(3) Costs for reporting debts to credit bureaus;
(4) Costs for purchase of credit bureau reports;
(5) Costs associated with computer operations and other costs
associated with the maintenance of records;
(6) Bank charges;
(7) Collection agency costs;
(8) Court costs and attorney fees; and
(9) Costs charged by other Governmental agencies.
(b) Notwithstanding any provision of State law, if the Secretary
uses a collection agency to collect a debt on a contingent fee basis,
the Secretary charges the debtor, and collects through the agency, an
amount sufficient to recover--
(1) The entire amount of the debt; and
(2) The amount that the Secretary is required to pay the agency for
its collection services.
(c)(1) The amount recovered under paragraph (b) of this section is
the entire amount of the debt, multiplied by the following fraction:
[GRAPHIC] [TIFF OMITTED] TC15NO91.009
(2) In paragraph (c)(1) of this section, cr equals the commission
rate the Department pays to the collection agency.
(d) If the Secretary uses more than one collection agency to collect
similar debts, the commission rate (cr) described in paragraph (c)(2) of
this section is calculated as a weighted average of the commission rates
charged by all collection agencies collecting similar debts, computed
for each fiscal year based on the formula
[GRAPHIC] [TIFF OMITTED] TC15NO91.010
where--
(1) Xi equals the dollar amount of similar debts placed by the
Department with an individual collection agency as of the end of the
preceding fiscal year;
(2) Yi equals the commission rate the Department pays to that
collection agency for the collection of the similar debts;
[[Page 58]]
(3) Z equals the dollar amount of similar debts placed by the
Department with all collection agencies as of the end of the preceding
fiscal year; and
(4) N equals the number of collection agencies with which the
Secretary has placed similar debts as of the end of the preceding fiscal
year.
(e) If a debtor has agreed under a repayment or settlement agreement
with the Secretary to pay costs associated with the collection of a debt
at a specified amount or rate, the Secretary collects those costs in
accordance with the agreement.
(f) The Secretary does not impose collection costs against State or
local governments under paragraphs (a) through (d) of this section.
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3711(e),
3717(e)(1), 3718))
Sec. 30.61 What penalties does the Secretary impose on delinquent
debtors?
(a) If a debtor does not make a payment on a debt, or portion of a
debt, within 90 days after the date specified in the first demand for
payment sent to the debtor, the Secretary imposes a penalty on the
debtor.
(b)(1) The amount of the penalty imposed under paragraph (a) of this
section is 6 percent per year of the amount of the delinquent debt.
(2) The penalty imposed under this section runs from the date
specified in the first demand for payment to the date the debt
(including the penalty) is paid.
(c) If a debtor has agreed under a repayment or settlement agreement
with the Secretary to pay a penalty for failure to pay a debt when due,
or has such an agreement under a grant or contract under which the debt
arose, the Secretary collects the penalty in accordance with the
agreement, grant, or contract.
(d) The Secretary does not impose a penalty against State or local
governments under paragraphs (a) and (b) of this section.
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3711(e))
Sec. 30.62 When does the Secretary forego interest, administrative
costs, or penalties?
(a) For a debt of any amount based on a loan, the Secretary may
refrain from collecting interest or charging administrative costs or
penalties to the extent that compromise of these amounts is appropriate
under the standards for compromise of a debt contained in 4 CFR part
103.
(b) For a debt not based on a loan the Secretary may waive, or
partially waive, the charging of interest, or the collection of
administrative costs or penalties, if--
(1) Compromise of these amounts is appropriate under the standards
for compromise of a debt contained in 4 CFR part 103; or
(2) The Secretary determines that the charging of interest or the
collection of administrative costs or penalties is--
(i) Against equity and good conscience; or
(ii) Not in the best interests of the United States.
(c) The Secretary may exercise waiver under paragraph (b)(1) of this
section without regard to the amount of the debt.
(d) The Secretary may exercise waiver under paragraph (b)(2) of this
section if--
(1) The Secretary has accepted an installment plan under 4 CFR
102.11;
(2) There is no indication of fault or lack of good faith on the
part of the debtor; and
(3) The amount of interest, administrative costs, and penalties is
such a large portion of the installments that the debt may never be
repaid if that amount is collected.
(e)(1) The Secretary does not charge interest on any portion of a
debt, other than a loan, owed by a person subject to 31 U.S.C. 3717 if
the debt is paid within 30 days after the date of the first demand for
payment.
(2) The Secretary may extend the period under paragraph (e)(1) of
this section if the Secretary determines that the extension is
appropriate.
(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3711(e))
[[Page 59]]
Subpart F_What Requirements Apply to the Compromise of a Debt or the
Suspension or Termination of Collection Action?
Sec. 30.70 How does the Secretary exercise discretion to compromise
a debt or to suspend or terminate collection of a debt?
(a) The Secretary uses the standards in the FCCS, 4 CFR part 103, to
determine whether compromise of a debt is appropriate if--
(1) The debt must be referred to the Department of Justice under
this section; or
(2) The amount of the debt is less than or equal to $20,000 and the
Secretary does not follow the procedures in paragraph (e) of this
section.
(b) The Secretary refers a debt to the Department of Justice to
decide whether to compromise a debt if--
(1) The debt was incurred under a program or activity subject to
section 452(f) of the General Education Provisions Act and the initial
determination of the debt was more than $50,000; or
(2) The debt was incurred under a program or activity not subject to
section 452(f) of the General Education Provisions Act and the amount of
the debt is more than $20,000.
(c) The Secretary may compromise the debt under the procedures in
paragraph (e) of this section if--
(1) The debt was incurred under a program or activity subject to
section 452(f) of the General Education Provisions Act; and
(2) The initial determination of the debt was less than or equal to
$50,000.
(d) The Secretary may compromise a debt without following the
procedure in paragraph (e) of this section if the amount of the debt is
less than or equal to $20,000.
(e) The Secretary may compromise the debt pursuant to paragraph (c)
of this section if--
(1) The Secretary determines that--
(i) Collection of any or all of the debt would not be practical or
in the public interest; and
(ii) The practice that resulted in the debt has been corrected and
will not recur;
(2) At least 45 days before compromising the debt, the Secretary
publishes a notice in the Federal Register stating--
(i) The Secretary's intent to compromise the debt; and
(ii) That interested persons may comment on the proposed compromise;
and
(3) The Secretary considers any comments received in response to the
Federal Register notice before finally compromising the debt.
(f)(1) The Secretary uses the standards in the FCCS, 4 CFR part 104,
to determine whether suspension or termination of collection action is
appropriate.
(2) The Secretary--
(i) Refers the debt to the Department of Justice to decide whether
to suspend or terminate collection action if the amount of the debt at
the time of the referral is more than $20,000; or
(ii) May decide to suspend or terminate collection action if the
amount of the debt at the time of the Secretary's decision is less than
or equal to $20,000.
(g) In determining the amount of a debt under paragraphs (a) through
(f) of this section, the Secretary excludes interest, penalties, and
administrative costs.
(h) Notwithstanding paragraphs (b) through (f) of this section, the
Secretary may compromise a debt, or suspend or terminate collection of a
debt, in any amount if the debt arises under the Guaranteed Student Loan
Program authorized under title IV, part B, of the Higher Education Act
of 1965, as amended, or the Perkins Loan Program authorized under title
IV, part E, of the Higher Education Act of 1965, as amended.
(i) The Secretary refers a debt to the General Accounting Office
(GAO) for review and approval before referring the debt to the
Department of Justice for litigation if--
(1) The debt arose from an audit exception taken by GAO to a payment
made by the Department; and
(2) The GAO has not granted an exception from the GAO referral
requirement.
(j) Nothing in this section precludes--
(1) A contracting officer from exercising his authority under
applicable
[[Page 60]]
statutes, regulations, or common law to settle disputed claims relating
to a contract; or
(2) The Secretary from redetermining a claim.
(Authority: 20 U.S.C. 1082(a) (5) and (6), 1087hh, 1221e-3(a)(1), 1226a-
1, and 1234a(f), 31 U.S.C. 3711(e))
[53 FR 33425, Aug. 30, 1988]
Subpart G [Reserved]
PART 31_SALARY OFFSET FOR FEDERAL EMPLOYEES WHO ARE INDEBTED TO THE
UNITED STATES UNDER PROGRAMS ADMINISTERED BY THE SECRETARY OF
EDUCATION--Table of Contents
Sec.
31.1 Scope.
31.2 Definitions.
31.3 Pre-offset notice.
31.4 Request to inspect and copy documents relating to a debt.
31.5 Request for hearing on the debt or the proposed offset.
31.6 Location and timing of oral hearing.
31.7 Hearing procedures.
31.8 Rules of decision.
31.9 Decision of the hearing official.
31.10 Request for repayment agreement.
31.11 Offset process.
Authority: 5 U.S.C. 5514; 31 U.S.C. 3716.
Source: 54 FR 31821, Aug. 19, 1989, unless otherwise noted.
Sec. 31.1 Scope.
(a) General. The Secretary establishes the standards and procedures
in this part that apply to the offset from disposable pay of a current
or former Federal employee or from amounts payable from the Federal
retirement account of a former Federal employee to recover a debt owed
the United States under a program adminstered by the Secretary of
Education.
(b) Exclusions. This part does not apply to--
(1) Offsets under 34 CFR part 32 to recover for overpayments of pay
or allowances to an employee of the Department;
(2) Offsets under 34 CFR part 30; or
(3) Offsets under section 124 of Pub. L. 97-276 to collect debts
owed to the United States on judgments.
(c) Reports to consumer reporting agency. The Secretary may report a
debt to a consumer reporting agency after notifying the employee, in
accordance with 34 CFR 30.35, of the intention to report the debt, and
after providing the employee an opportunity to inspect documents,
receive a hearing, and enter into a repayment agreement under this part.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3711; 31 U.S.C. 3716)
Sec. 31.2 Definitions.
As used in this part:
Agency means--
(1) An Executive agency as defined in 5 U.S.C. 105, including the
U.S. Postal Service and the U.S. Postal Rate Commission;
(2) A military department as defined in 5 U.S.C. 102;
(3) An agency or court in the judicial branch, including a court as
defined in 28 U.S.C. 610, the District Court for the Northern Mariana
Islands, and the Judicial Panel on Multidistrict Litigation;
(4) An agency of the legislative branch, including the U.S. Senate
and the U.S. House of Representatives; and
(5) Any other independent establishment that is an entity of the
Federal Government.
Days refer to calendar days.
Department means the Education Department.
Disposable pay means the amount that remains from an employee's pay
after required deductions for Federal, State, and local income taxes;
Social Security taxes, including Medicare taxes; Federal retirement
programs; premiums for basic life insurance and health insurance
benefits; and such other deductions that are required by law to be
withheld.
Employee means a current or former employee of an agency. In the
case of an offset proposed to collect a debt owed by a deceased
employee, the references in this part to the employee shall be read to
refer to the payee of benefits from the Federal retirement account or
other pay of the employee.
Federal retirement account means an account of an employee under the
Civil Service Retirement System or the Federal Employee Retirement
System.
[[Page 61]]
Offset means a deduction from the pay of an employee, or a payment
due from the Federal retirement account of an employee, to satisfy a
debt.
Pay means basic pay, special pay, incentive pay, retired pay,
retainer pay, or, in the case of an individual not entitled to basic
pay, other authorized pay, including severance pay or lump sum payments
for accrued annual leave, and amounts payable from the Federal
retirement account of an employee.
Secretary means the Secretary of the Department of Education or an
official or employee of the Department acting for the Secretary under a
delegation of authority.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 31.3 Pre-offset notice.
(a) At least 65 days before initiating an offset against the pay of
an employee, the Secretary sends a written notice to the employee
stating--
(1) The nature and amount of the debt;
(2) A demand for payment of the debt;
(3) The manner in which the Secretary charges interest,
administrative costs, and penalties on the debt;
(4) The Secretary's intention to collect the debt by offset
against--
(i) 15 percent of the employee's current disposable pay; and
(ii) If the debt cannot be satisfied by offset against current
disposable pay, a specified amount of severance pay, a lump sum annual
leave payment, a final salary check, or payments from the Federal
retirement account of the employee;
(5) The amount, frequency, approximate beginning date and duration
of the proposed offset;
(6) The employee's opportunity to--
(i) Inspect and copy Department records pertaining to the debt;
(ii) Obtain a pre-offset hearing before a hearing official who is
not under the control or supervision of the Secretary regarding the
existence or amount of the debt, or the proposed offset schedule; and
(iii) Enter into a written agreement with the Secretary to repay the
debt;
(7) The date by which the employee must request an opportunity set
forth under paragraph (a)(6) of this section;
(8) The grounds for objecting to collection of the debt by offset;
(9) The applicable hearing procedures and requirements;
(10) That the Secretary grants any request for access to records,
for a hearing, or for a satisfactory repayment agreement made by an
employee;
(11) That the Secretary does not delay the start of the proposed
offset, or suspend an offset already commenced, unless--
(i) An employee makes the request for access to records or for a
hearing, or enters into a repayment agreement that is acceptable to the
Secretary, before the deadlines described in this part; or
(ii) An employee requests a hearing after the deadlines established
in Sec. 31.5(a), but submits evidence satisfactory to the Secretary
that the request was not made in a timely manner because the employee
did not have notice of the proposed offset, or was prevented from making
the request by factors beyond his or her control, until after the
deadlines had passed;
(12) That a final decision on the hearing will be issued not later
than 60 days after the date on which the employee files a request for a
hearing under Sec. 31.5, unless a delay in the proceedings is granted
at the request of the employee;
(13) That submission by the employee of knowingly false statements,
representations or evidence may subject the employee to applicable
disciplinary procedures, or civil or criminal penalties; and
(14) That any amounts paid or collected by offset on a debt later
determined to be unenforceable or canceled will be refunded to the
employee.
(b)(1) In determining whether an employee has requested an
opportunity set forth under paragraph (a)(6) of this section in a timely
manner, the Secretary relies on--
(i) A legibly dated U.S. Postal Service postmark for the employee's
request; or
(ii) A legibly stamped U.S. Postal Service mail receipt for the
employee's request.
[[Page 62]]
(2) The Secretary does not rely on either of the following as proof
of mailing:
(i) A private metered postmark.
(ii) A mail receipt that is not dated by the U.S. Postal Service.
(c) Payment by offset under this part of all or part of a debt does
not constitute an acknowledgment of the debt or a waiver of rights
available to the employee under this part or other applicable law if the
employee has not agreed in writing to the offset.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 31.4 Request to inspect and copy documents relating to a debt.
(a) The Secretary makes available for inspection and copying before
offset under this part those Department documents that relate to the
debt, if the employee--
(1) Files a written request to inspect and copy the documents within
20 days of the date of the pre-offset notice under Sec. 31.3, and
(2) Files the request at the address specified in that notice.
(b) A request filed under paragraph (a)(1) of this section must
contain--
(1) All information provided to the employee in the pre-offset
notice under Sec. 31.3 that identifies the employee and the debt,
including the employee's Social Security number and the program under
which the debt arose, together with any corrections of that identifying
information; and
(2) A reasonably specific identification of the documents that the
employee wishes to have available for inspection and copying.
(c) The Secretary makes available documents for inspection and
copying upon request by the employee. However, the Secretary may
initiate an offset before making the requested documents available if
the employee fails to request inspection and copying in accordance with
this section.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 31.5 Request for hearing on the debt or the proposed offset.
(a) Deadlines. (1) The Secretary provides a hearing before offset on
the existence, amount, or enforceability of the debt described in the
pre-offset notice provided under Sec. 31.3, or on the amount or
frequency of the offsets as proposed in that notice, if the employee--
(i) Files a request for the hearing within the later of--
(A) 65 days after the date of the pre-offset notice provided under
Sec. 31.3; or
(B) 15 days after the date on which the Secretary makes available to
the employee the relevant, requested documents if the employee had
requested an opportunity to inspect and copy documents within 20 days of
the date of the pre-offset notice provided under Sec. 31.3; and
(ii) Files a request at the address specified in that notice.
(2) The Secretary provides a hearing upon request by the employee.
However, if the employee does not submit, within the deadlines in
paragraph (a)(1) of this section, a request that meets the requirements
of paragraphs (b) and (c) of this section, the Secretary does not delay
the start of an offset, or suspend an offset already commenced, unless
the employee submits evidence satisfactory to the Secretary that the
request was not made in a timely manner because the employee did not
have notice of the proposed offset, or was otherwise prevented from
making the request by factors beyond his or her control, until after the
deadlines had passed.
(b) Contents of request for a hearing. A request for a hearing must
contain--
(1) All information provided to the employee in the pre-offset
notice under Sec. 31.3 that identifies the employee and the particular
debt, including the employee's Social Security number and the program
under which the debt arose, together with any corrections needed with
regard to that identifying information;
(2) An explanation of the reasons why the employee believes that--
(i) The debt as stated in the pre-offset notice is not owing or is
not enforceable by offset; or
(ii) The amount of the proposed offset described in the pre-offset
notice will cause extreme financial hardship to the employee;
(3) If the employee contends that the amount of the proposed offset
will
[[Page 63]]
cause extreme financial hardship under the standards set forth in Sec.
31.8(b)--
(i) An alternative offset proposal;
(ii) An explanation, in writing, showing why the offset proposed in
the notice would cause an extreme financial hardship for the employee;
and
(iii) Documents that show for the employee and for the spouse and
dependents of the employee, for the one-year period preceding the
Secretary's notice and for the repayment period proposed by the employee
in his or her offset schedule--
(A) Income from all sources,
(B) Assets,
(C) Liabilities,
(D) Number of dependents,
(E) Expenses for food, housing, clothing, and transportation,
(F) Medical expenses, and
(G) Exceptional expenses, if any; and
(4) Copies of all documents that the employee wishes to have
considered to support the objections raised by the employee regarding
the enforceability of the debt or the claim of extreme financial
hardship.
(c) Request for oral hearing. (1) If the employee wants the hearing
to be conducted as an oral hearing, the employee must submit a request
that contains the information listed in paragraph (b) and must include
with the request--
(i) An explanation of reasons why the employee believes that the
issues raised regarding the enforceability of the debt or a claim of
extreme financial hardship cannot be resolved adequately by a review of
the written statements and documents provided with the request for a
hearing;
(ii) An identification of--
(A) The individuals that the employee wishes to have testify at the
oral hearing;
(B) The specific issues about which each individual is prepared to
testify; and
(C) The reasons why each individual's testimony is necessary to
resolve the issue.
(2) The Secretary grants a request for an oral hearing if--
(i) The employee files a request for an oral hearing that meets the
requirements of paragraphs (b) and (c) of this section; and
(ii) The Secretary determines that the issues raised by the employee
require a determination of the credibility of testimony and cannot be
adequately resolved by a review of the written statements and documents
submitted by the employee and documents contained in the Department's
records relating to the debt.
(3) The Secretary may decline a request for an oral hearing if the
Secretary accepts the employee's proffer of testimomy made in the
request for an oral hearing under paragraph (c)(1) of this section, and
considers the facts at issue to be established as stated by the employee
in the request.
(4) If the Secretary grants a request for an oral hearing, the
Secretary--
(i) Notifies the employee in writing of--
(A) The date, time, and place of the hearing;
(B) The name and address of the hearing official;
(C) The employee's right to be represented at the hearing by counsel
or other representatives;
(D) The employee's right to present and cross-examine witnesses; and
(E) The employee's right to waive the requested oral hearing and
receive a hearing in the written record; and
(ii) Provides the hearing official with a copy of all written
statements submitted by the employee with the request for a hearing, and
all documents pertaining to the debt or the amount of the offset
contained in the Department's files on the debt or submitted with the
request for a hearing.
(d) Employee choice of oral hearing or hearing on written
submissions. An employee who has been sent notice under paragraph (c)(4)
that an oral hearing will be provided must, within 15 days of the date
of that notice, state in writing to the hearing official and the
Secretary--
(1) Whether the employee intends to proceed with the oral hearing,
or wishes a decision based on the written record; and
(2) Any changes in the list of the witnesses the employee proposes
to produce for the hearing, or the facts about which a witness will
testify.
(e) Dismissal of request for hearing. The Secretary considers the
employee to
[[Page 64]]
have waived the request for a hearing of any kind--
(1) If an employee does not provide the hearing official in a timely
manner the written statement required under paragraph (d) of this
section; or
(2) If the employee does not appear for a scheduled oral hearing.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 31.6 Location and timing of oral hearing.
(a) If the Secretary grants a request for an oral hearing, the
Secretary selects the time, date, and location of the hearing. The
Secretary selects, to the extent feasible, the location that is most
convenient for the employee.
(b) For a current military employee, the Secretary selects the time,
date, and location of the hearing after consultation with the Secretary
of Defense.
(c) For a current Coast Guard employee, the Secretary selects the
time, date, and location of the hearing after consultation with the
Secretary of Transportation.
(d) For an employee not described in paragraph (a) or (b) of this
section, the hearing will be held in Washington, DC, or in one of the
following cities: Boston, Philadelphia, New York, Atlanta, Chicago,
Dallas, Kansas City, Denver, San Francisco, or Seattle.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 31.7 Hearing procedures.
(a) Independence of hearing official. A hearing provided under this
part is conducted by a hearing official who is neither an employee of
the Department nor otherwise under the supervision or control of the
Secretary.
(b) Lack of subpoena authority or formal discovery. (1) Neither the
hearing official nor the Secretary has authority to issue subpoenas to
compel the production of documents or to compel the attendance of
witnesses at an oral hearing under this part. The Secretary will attempt
to make available during an oral hearing the testimony of a current
official of the Department if--
(i) The employee had identified the official in the request for a
hearing under Sec. 31.5(b) and demonstrated that the testimony of the
official is necessary to resolve adequately an issue of fact raised by
the employee in the request for a hearing; and
(ii) The Secretary determines that the responsibilities of the
official permit his or her attendance at the hearing.
(2) If the Secretary determines that the testimony of a Department
official is necessary, but that the official cannot attend an oral
hearing to testify, the Secretary attempts to make the official
available for testimony at the hearing by means of a telephone
conference call.
(3) No discovery is available in a proceeding under this part except
as provided in Sec. 31.4.
(c) Hearing on written submissions. If a hearing is conducted on the
written submissions, the hearing official reviews documents and
responses submitted by the Secretary and the employee under Sec. 31.5.
(d) Conduct of oral hearing. (1) The hearing official conducts an
oral hearing as an informal proceeding. The official--
(i) Administers oaths to witnesses;
(ii) Regulates the course of the hearing;
(iii) Considers the introduction of evidence without regard to the
rules of evidence applicable to judicial proceedings; and
(iv) May exclude evidence that is redundant, or that is not relevant
to those issues raised by the employee in the request for hearing under
Sec. 31.5 that remain in dispute.
(2) An oral hearing is generally open to the public. However, the
hearing official may close all or any portion of the hearing if doing so
is in the best interest of the employee or the public.
(3) The hearing official may conduct an oral hearing by telephone
conference call--
(i) If the employee is located in a city outside the Washington, DC
Metropolitan area.
(ii) At the request of the employee.
(iii) At the discretion of the hearing official.
(4) No written record is created or maintained of an oral hearing
provided under this part.
(e) Burden of proof. In any hearing under this part--
[[Page 65]]
(1) The Secretary bears the burden of proving, by a preponderance of
the evidence, the existence and amount of the debt, and the failure of
the employee to repay the debt, as the debt is described in the pre-
offset notice provided under Sec. 31.3; and
(2) The employee bears the burden of proving, by a preponderance of
the evidence--
(i) The existence of any fact that would establish that the debt
described in the pre-offset notice is not enforceable by offset; and
(ii) The existence of any fact that would establish that the amount
of the proposed offset would cause an extreme financial hardship for the
employee.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 31.8 Rules of decision.
(a) Enforceability of debt by offset. In deciding whether the
Secretary has established that the debt described in the pre-offset
under Sec. 31.3 is owed by the employee, or whether the employee has
established that the debt is not enforceable by offset, the hearing
official shall apply the principles in this paragraph.
(1) The statutes and Department regulations authorizing and
implementing the program under which the debt arose must be applied in
accordance with official written interpretations by the Department.
(2) The principles of res judicata and collateral estoppel apply to
resolution of disputed facts in those instances in which the debt or
material facts in dispute have been the subject of prior judicial
decision.
(3) The act or omission of an institution of higher education at
which the employee was enrolled does not constitute a defense to
repayment of an obligation with regard to a grant or loan under a
program authorized under Title IV of the Higher Education Act or similar
authority, except to the extent that--
(i) The act or omission constitutes a defense to the debt under
applicable Federal or State law;
(ii) The institution owed the employee a refund under its refund
policy and failed to pay that refund to the employee or to a lender
holding a loan made to the employee; or
(iii) The institution ceased teaching activity while the employee
was in attendance and during the academic period for which the grant or
loan was made, and failed to refund to the employee or holder of a loan
to the employee a proportionate amount of the grant or loan funds used
to pay tuition and other institutional charges for that academic period.
(4)(i) A debt otherwise established as owed by the employee is
enforceable by offset under this part if the Secretary sends the pre-
offset notice for the debt within the ten year period following the
later of--
(A) The date on which the Secretary acquired the debt by assignment
or referral, or
(B) The date of a subsequent partial payment reaffirming the debt.
(ii) Periods during which the statute of limitations applicable to a
lawsuit to collect the debt has been tolled under 11 U.S.C. 108, 28
U.S.C. 2416, 50 U.S.C. App. 525, or other authority are excluded from
the calculation of the ten year period described in paragraph (a)(4)(i)
of this section.
(b) Extreme financial hardship. (1) In deciding whether an employee
has established that the amount of the proposed offset would cause
extreme financial hardship to the employee, the hearing official shall
determine whether the credible, relevant evidence submitted demonstrates
that the proposed offset would prevent the employee from meeting the
costs necessarily incurred for essential subsistence expenses of the
employee and his or her spouse and dependents.
(2) For purposes of this determination, essential subsistence
expenses include costs incurred only for food, housing, clothing,
essential transportation and medical care.
(3) In making this determination, the hearing official shall
consider--
(i) The income from all sources of the employee, and his or her
spouse and dependents;
(ii) The extent to which the assets of the employee and his or her
spouse and dependents are available to meet the offset and the essential
subsistence expenses;
[[Page 66]]
(iii) Whether these essential subsistence expenses have been
minimized to the greatest extent possible;
(iv) The extent to which the employee and his or her spouse and
dependents can borrow to satisfy the debt to be collected by offset or
to meet essential expenses; and
(v) The extent to which the employee and his or her spouse and
dependents have other exceptional expenses that should be taken into
account, and whether these expenses have been minimized.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 31.9 Decision of the hearing official.
(a) The hearing official issues a written opinion within sixty days
of the date on which the employee filed a request for a hearing under
Sec. 31.5, unless a delay in the proceedings has been granted at the
request of the employee. In the opinion, the hearing official states his
or her decision and the findings of fact and conclusions of law on which
the decision is based.
(b) If the hearing official finds that a portion of the debt
described in the pre-offset notice under Sec. 31.3 is not enforceable
by offset, the official shall state in the opinion that portion which is
enforceable by offset.
(c) If the hearing official finds that the amount of the offset
proposed in the pre-offset notice will cause an extreme financial
hardship for the employee, the hearing official shall establish an
offset schedule that will result in the repayment of the debt in the
shortest period of time without producing an extreme financial hardship
for the employee.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 31.10 Request for repayment agreement.
(a) The Secretary does not initiate an offset under this part if the
employee agrees in writing to repay the debt under terms acceptable to
the Secretary and makes the first payment due under the agreement on or
before the latest of--
(1) The seventh day after the date of the decision of the hearing
official, if the employee timely requested a hearing under Sec. 31.5
(a) and (d);
(2) The sixty-fifth day after the date of the pre-offset notice
under Sec. 31.3 if the employee did not timely request either a hearing
in accordance with Sec. 31.5 (a) and (d) or an opportunity to inspect
and copy documents related to the debt under Sec. 31.4; or
(3) The fifteenth day after the date on which the Secretary made
available documents related to the debt, if the employee filed a timely
request for documents under Sec. 31.4.
(b) In the agreement, the Secretary and the employee may agree to
satisfaction of the debt from sources other than an offset under this
part, or may modify the amount proposed to be offset in the pre-offset
notice or estimated in the decision of the hearing official.
(c) If the employee does not enter into a repayment agreement
acceptable to the Secretary within the deadlines in this section, the
Secretary may initiate an offset under this part. The Secretary
continues to collect by offset until an employee enters in a
satisfactory repayment agreement for the debt. The Secretary suspends an
offset already commenced under circumstances described in Sec.
31.5(a)(2).
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 31.11 Offset process.
(a) The Secretary attempts to collect debts under this part within
the shortest time authorized under--
(1) The offset schedule proposed in the pre-offset notice, unless
modified by agreement or by the decision of a hearing official;
(2) A written repayment agreement with the employee; or
(3) The offset schedule established in the decision of the hearing
official.
(b) In proposing an offset schedule under Sec. 31.3 or establishing
a repayment agreement under Sec. 31.10, the Secretary also considers
the expected period of Federal employment of the employee.
(c) Unless the Secretary determines, in his discretion, to delay or
suspend collection, the Secretary effects an offset under this part--
(1) According to the terms agreed to by the employee pursuant to a
timely request under Sec. 31.10 to enter into a repayment agreement;
or,
[[Page 67]]
(2) After the deadlines in Sec. 31.10(b) for requesting a repayment
agreement with the Secretary.
(d) If the employee retires, resigns, or leaves Federal employment
before the debt is satisfied, the Secretary collects the amount
necessary to satisfy the debt by offset from subsequent payments of any
kind, including a final salary payment or a lump sum annual leave
payment, due the employee on the date of separation. If the debt cannot
be satisfied by offset from any such final payment due the employee on
the date of separation, the Secretary collects the debt from later
payments of any kind due the employee in accordance with the provisions
of 4 CFR 102.4.
(e) The Secretary effects an offset under this part against payments
owing to an employee of another Federal agency after completion of the
requirements of this part, in accordance with the provisions of 5 CFR
550.1108.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
PART 32_SALARY OFFSET TO RECOVER OVERPAYMENTS OF PAY OR ALLOWANCES
FROM DEPARTMENT OF EDUCATION EMPLOYEES--Table of Contents
Sec.
32.1 Scope.
32.2 Definitions.
32.3 Pre-offset notice.
32.4 Employee response.
32.5 Pre-offset hearing--general.
32.6 Request for a pre-offset hearing.
32.7 Pre-offset oral hearing.
32.8 Pre-offset hearing on the written submissions.
32.9 Written decision.
32.10 Deductions process.
Authority: 5 U.S.C. 5514; 31 U.S.C. 3716.
Source: 52 FR 24957, July 1, 1987, unless otherwise noted.
Sec. 32.1 Scope.
(a) The Secretary establishes the standards and procedures in this
part that apply to the deductions through offset from disposable pay of
a current or former employee of the Department of Education to recover
overpayments of pay or allowances.
(b) This part does not apply to--
(1) Recovery through offset of an indebtedness to the United States
by an employee of the Department under a program administered by the
Secretary of Education covered under 34 CFR part 31;
(2) The offset of an indebtedness to the United States by a Federal
employee to satisfy a judgment obtained by the United States against
that employee in a court of the United States;
(3) The offset of any payment to an employee of the Department of
Education which is expressly allowed under statutes other than 5 U.S.C.
5514, except as to offsets of severance pay and/or lump sum annual leave
payments as authorized under 31 U.S.C. 3716;
(4) Offsets under 34 CFR part 30; or
(5) An employee election of coverage or of a change of coverage
under a Federal benefits program which requires periodic deductions from
pay if the amount to be recovered was accumulated over four pay periods
or less.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 32.2 Definitions.
The following definitions apply to this part:
Department means the Department of Education.
Disposable pay means the amount that remains from an employee's pay
after required deductions for Federal, State, and local income taxes;
Social Security taxes, including Medicare taxes; Federal retirement
programs; premiums for health and basic life insurance benefits; and
such other deductions that are required by law to be withheld.
Employee means a current or former employee of the Department.
Former employee means a former employee of the Department who is
entitled to pay from the Department or another agency.
Pay means basic pay, special pay, incentive pay, retired pay,
retainer pay, or, in the case of an individual not entitled to basic
pay, other authorized pay, including severance pay and/or lump sum
payments for accrued annual leave.
Paying agency means a Federal agency currently employing an
individual and authorizing the payment of his or her current pay.
Secretary means the Secretary of the Department of Education or an
official
[[Page 68]]
or employee of the Department acting for the Secretary under a
delegation of authority.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 32.3 Pre-offset notice.
At least 30 days before initiating a deduction from the disposable
pay of an employee to recover an overpayment of pay or allowances, the
Secretary sends a written notice to the employee stating--
(a) The origin, nature and amount of the overpayment;
(b) How interest is charged and administrative costs and penalties
will be assessed, unless excused under 31 U.S.C. 3716;
(c) A demand for repayment, providing for an opportunity for the
employee to enter into a written repayment agreement with the
Department;
(d) Where a waiver of repayment is authorized by law, the employee's
right to request a waiver;
(e) The Department's intention to deduct 15 percent of the
employee's disposable pay, or a specified amount if the disposable pay
is severance pay and/or a lump sum annual leave payment, to recover the
overpayment if a waiver is not granted by the Secretary and the employee
fails to repay the overpayment or enter into a written repayment
agreement;
(f) The amount, frequency, approximate beginning date and duration
of the intended deduction;
(g) If Government records on which the determination of overpayment
are not attached, how those records will be made available to the
employee for inspection and copying;
(h) The employee's right to request a pre-offset hearing concerning
the existence or amount of the overpayment or an involuntary repayment
schedule;
(i) The applicable hearing procedures and requirements, including a
statement that a timely petition for hearing will stay commencement of
collection proceedings and that a final decision on the hearing will be
issued not later than 60 days after the hearing petition is filed,
unless a delay is requested and granted;
(j) That any knowingly false or frivolous statements,
representations or evidence may subject the employee to applicable
disciplinary procedures, civil or criminal penalties; and
(k) That where amounts paid or deducted are later waived or found
not owed, unless otherwise provided by law, they will be promptly
refunded to the employee.
(Authority: 5 U.S.C. 5514, 31 U.S.C. 3716)
Sec. 32.4 Employee response.
(a) Voluntary repayment agreement. Within 7 days of receipt of the
written notice under Sec. 32.3, the employee may submit a request to
the Secretary to arrange for a voluntary repayment schedule. To arrange
for a voluntary repayment schedule, the employee shall submit a
financial statement and sign a written repayment agreement approved by
the Secretary. An employee who arranges for a voluntary repayment
schedule may nonetheless request a waiver of the overpayment under
paragraph (b) of this section.
(b) Waiver. An employee seeking a waiver of collection of the debt
that is authorized by law must request the waiver in writing to the
Secretary within 10 days of receipt of the written notice under Sec.
32.3. The employee must state why he or she believes a waiver should be
granted.
(c) Involuntary repayment schedule. If the employee claims that the
amount of the involuntary deduction will cause extreme financial
hardship and should be reduced, he or she must submit a written
explanation and a financial statement signed under oath or affirmation
to the Secretary within 10 days of receipt of the written notice under
Sec. 32.3. An employee who fails to submit this financial information
in a timely manner waives the right to object to the involuntary
repayment schedule at a hearing under Sec. 32.5. The Secretary notifies
the employee, in writing, whether the Secretary will reduce the rate of
the involuntary deduction.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 32.5 Pre-offset hearing--general.
(a) An employee who wishes a review of the existence or amount of
the overpayment or an involuntary repayment schedule may request a pre-
offset hearing. The pre-offset hearing does not review:
[[Page 69]]
(1) The denial of a waiver of repayment under 5 U.S.C. 5584;
(2) The involuntary repayment schedule or financial hardship caused
by the amount of the involuntary deduction from the employee's
disposable pay, unless the employee has submitted the financial
statement and written explanation required under Sec. 32.4(c); and
(3) The determination under paragraph (b) of this section that the
pre-offset hearing is on the written submissions.
(b) Unless the Secretary determines that a matter reviewable under
paragraph (a) of this section turns on an issue of credibility or
veracity or cannot be resolved by a review of the documentary evidence,
the pre-offset hearing is on the written submissions.
(c) A pre-offset hearing is based on the written submissions for
overpayments arising from:
(1) A termination of a temporary promotion;
(2) A cash award;
(3) An erroneous salary rate;
(4) Premature granting of a within-grade increase;
(5) A lump sum payment for annual leave;
(6) Unauthorized appointment to a position;
(7) An error on time and attendance records; or
(8) Other circumstances where the Secretary determines that an oral
hearing is not required.
(d) The hearing is conducted by a hearing official who is not an
employee of the Department or under the supervision or control of the
Secretary.
(e) Formal discovery between the parties is not provided.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 32.6 Request for a pre-offset hearing.
(a) Except for an employee who has requested a waiver of collection
of the debt under Sec. 32.4(b), an employee who wishes a pre-offset
hearing must request the hearing within 15 days of receipt of the
written notice given under Sec. 32.3. The Secretary waives the 15-day
requirement if the employee shows that the delay was because of
circumstances beyond his or her control or because of failure to receive
notice and lack of knowledge of the time limit.
(b) An employee who has requested a waiver under Sec. 32.4(b) may
request a hearing within 10 days of receipt of a determination by the
Secretary denying a waiver.
(c) The request for a hearing must:
(1) Be in writing;
(2) State why the employee:
(i) Contests the existence or amount of the overpayment; or
(ii) Claims that the involuntary repayment schedule will cause
extreme financial hardship;
(3) Include all documents on which the employee is relying, other
than those provided by the Secretary under Sec. 32.3; any document
which is a statement of an individual must be in the form of an
affidavit; and
(4) Be submitted to the designated hearing official with a copy to
the Secretary.
(d) If the employee timely requests a pre-offset hearing or the
timelines are waived under paragraph (a) of this section, the Secretary:
(1) Notifies the employee whether the employee may elect an oral
hearing; and
(2) Provides the hearing official with a copy of all records on
which the determination of the overpayment and any involuntary repayment
schedule are based.
(e) An employee who has been given the opportunity to elect an oral
hearing and who does elect an oral hearing must notify the hearing
official and the Secretary of his or her election in writing within 7
days of receipt of the notice under paragraph (d)(1) of this section and
must identify all proposed witnesses and all facts and evidence about
which they will testify.
(f) Where an employee requests an oral hearing, the hearing official
notifies the Secretary and the employee of the date, time, and location
of the hearing. However:
(1) The employee subsequently may elect to have the hearing based
only on the written submissions by notifying the hearing official and
the Secretary at least 3 calendar days before the date of the oral
hearing. The hearing official may waive the 3-day requirement
[[Page 70]]
for good cause when the employee notifies the hearing official before
the date of the hearing; and
(2) The request for a hearing of an employee who fails to appear at
the oral hearing must be dismissed and the Secretary's decision
affirmed.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 32.7 Pre-offset oral hearing.
(a) Oral hearings are informal in nature. The Secretary and the
employee, through their representatives, and by reference to the
documentation submitted, explain their case. The employee may testify on
his or her own behalf, subject to cross examination. Other witnesses may
be called to testify only where the hearing official determines that
their testimony is relevant and not redundant.
(b) The hearing official shall:
(1) Conduct a fair and impartial hearing; and
(2) Preside over the course of the hearing, maintain decorum, and
avoid delay in the disposition of the hearing.
(c) The employee may represent himself or herself or may be
represented by another person at the hearing. The employee may not be
represented by a person whose representation creates an actual or
apparent conflict of interest.
(d) Oral hearings are open to the public. However, the hearing
official may close all or any portion of the hearing where to do so is
in the best interests of the employee or the public.
(e) Oral hearings may be conducted by conference call--
(1) If the employee is located in a city outside the Washington, DC
Metropolitan area;
(2) At the request of the employee; or
(3) At the discretion of the hearing official.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 32.8 Pre-offset hearing on the written submissions.
If a hearing is to be held on the written submissions, the hearing
official reviews the records and responses submitted by the Secretary
and the employee under Sec. 32.6.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 32.9 Written decision.
(a) The hearing official issues a written decision stating the facts
supporting the nature and origin of the debt and the hearing official's
analysis, findings and conclusions as to the amount of the debt and the
repayment schedule within 60 days of filing of the employee's request
for a pre-offset hearing, unless the employee requests, and the hearing
official grants, a delay in the proceedings.
(b) The hearing official decides whether the Secretary's
determination of the existence and the amount of the overpayment or the
extreme financial hardship caused by the involuntary repayment schedule
is clearly erroneous. A determination is clearly erroneous if although
there is evidence to support the determination, the hearing official,
considering the record as a whole, is left with a definite and firm
conviction that a mistake was made.
(c) In making the decision, the hearing official is governed by
applicable Federal statutes, rules and regulations.
(d) The hearing official decides the issue of extreme financial
hardship caused by the involuntary repayment schedule only where the
employee has submitted the financial statement and written explanation
required under Sec. 32.4(c). Where the hearing official determines that
the involuntary repayment schedule creates extreme financial hardship,
he or she must establish a schedule that alleviates the financial
hardship but may not reduce the involuntary repayment schedule to a
deduction of zero percent.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
Sec. 32.10 Deductions process.
(a) Debts must be collected in one lump sum where possible. If the
employee does not agree to a lump sum that exceeds 15 percent of
disposable pay, the debt must be collected in installment deductions at
officially established pay intervals in the amount established under:
(1) A voluntary repayment agreement;
(2) An involuntary repayment schedule where no hearing is requested;
or
(3) The schedule established under the written hearing decision.
[[Page 71]]
(b) Installment deductions must be made over a period not greater
than the anticipated period of employment, except as provided under
paragraph (d) of this section. If possible, the installment payment must
be sufficient in size and frequency to liquidate the debt in, at most,
three years. Installment payments of less than $25 may be accepted only
in the most unusual circumstances.
(c) Deductions must begin:
(1) After the employee has entered a voluntary repayment schedule;
(2) If a waiver is requested under Sec. 32.4(b), after the employee
has been denied a waiver by the Secretary; or
(3) If a hearing is requested under Sec. 32.5, after a written
decision.
(d) If the employee retires or resigns or his or her employment ends
before collection of the debt is completed, the amount necessary to
liquidate the debt must be offset from subsequent payments of any nature
(for example, final salary payment and/or lump sum annual leave payment)
due the employee on the date of separation. If the debt cannot be
liquidated by offset from any such final payment due the employee on the
date of separation, the debt must be liquidated by administrative offset
pursuant to 31 U.S.C. 3716 from later payments of any kind due the
employee, where appropriate. After the Secretary has complied with the
procedures in this part, the Secretary may refer the debt to a paying
agency for collection by offset under 5 CFR 550.1108.
(e) Interest, penalties and administrative costs on debts collected
under this part must be assessed, in accordance with the provisions of 4
CFR 102.13.
(f) An employee's payment, whether voluntary or involuntary, of all
or any portion of an alleged debt collected pursuant to this part may
not be construed as a waiver of any rights which the employee may have
under this part or any other provision of law, except as otherwise
provided by law.
(g) Amounts paid or deducted pursuant to this part by an employee
for a debt that is waived or otherwise found not owing to the United
States or which the Secretary is ordered to refund must be promptly
refunded to the employee.
(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)
PART 33_PROGRAM FRAUD CIVIL REMEDIES ACT--Table of Contents
Sec.
33.1 Basis and purpose.
33.2 Definitions.
33.3 Basis for civil penalties and assessments.
33.4 Investigation.
33.5 Review by the reviewing official.
33.6 Prerequisites for issuing a complaint.
33.7 Complaint.
33.8 Service of complaint.
33.9 Answer.
33.10 Default upon failure to file an answer.
33.11 Referral of complaint and answer to the ALJ.
33.12 Notice of hearing.
33.13 Parties to the hearing.
33.14 Separation of functions.
33.15 Ex parte contacts.
33.16 Disqualification of reviewing official or ALJ.
33.17 Rights of parties.
33.18 Authority of the ALJ.
33.19 Prehearing conferences.
33.20 Disclosure of documents.
33.21 Discovery.
33.22 Exchange of witness lists, statements and exhibits.
33.23 Subpoenas for attendance at hearing.
33.24 Protective order.
33.25 Fees.
33.26 Form, filing and service of papers.
33.27 Computation of time.
33.28 Motions.
33.29 Sanctions.
33.30 The hearing and burden of proof.
33.31 Determining the amount of penalties and assessments.
33.32 Location of hearing.
33.33 Witnesses.
33.34 Evidence.
33.35 The record.
33.36 Post-hearing briefs.
33.37 Initial decision.
33.38 Reconsideration of initial decision.
33.39 Appeal to Department head.
33.40 Stays ordered by the Department of Justice.
33.41 Stay pending appeal.
33.42 Judicial review.
33.43 Collection of civil penalties and assessments.
33.44 Right to administrative offset.
33.45 Deposit in Treasury of United States.
33.46 Compromise or settlement.
33.47 Limitations.
Authority: 31 U.S.C. 3801-3812.
[[Page 72]]
Source: 53 FR 15675, May 3, 1988, unless otherwise noted.
Sec. 33.1 Basis and purpose.
(a) Basis. This part implements the Program Fraud Civil Remedies Act
of 1986, Pub. L. No. 99-509, 6101 through 6104, 100 Stat. 16674 (October
21, 1986), to be codified at 31 U.S.C. 3801 through 3812. This law (31
U.S.C. 3809) requires each Federal department head to promulgate
regulations necessary to implement the provisions of the statute.
(Authority: 31 U.S.C. 3809)
(b) Purpose. This part:
(1) Establishes administrative procedures for imposing civil
penalties and assessments against persons who make, submit, or present,
or cause to be made, submitted, or presented, false, fictitious, or
fraudulent claims or written statements to the Department or to its
agents; and
(2) Specifies the hearing and appeal rights of persons subject to
allegations of liability for those penalties and assessments.
(Authority: 31 U.S.C. 3809)
Sec. 33.2 Definitions.
As used in this part:
ALJ means an Administrative Law Judge in the Department appointed
pursuant to 5 U.S.C. 3105 or detailed to the Department pursuant to 5
U.S.C. 3344.
(Authority: 31 U.S.C. 3801(a)(7)(A))
Benefits, as used in the definition of ``statement,'' means anything
of value, including but no limited to any advantage, preference,
privilege, license, permit, favorable decision, ruling, status, or loan
guarantee.
(Authority: 31 U.S.C. 3809)
Claim means any request, demand, or submission:
(a) Made to the Department for property, services, or money
(including money representing grants, cooperative agreements, loans,
insurance, or benefits);
(b) Made to a recipient of property, services, or money from the
Department or to a party to a contract or agreement with the Department:
(1) For property or services if the United States:
(i) Provided the property or services;
(ii) Provided any portion of the funds for the purchase of the
property or services; or
(iii) Will reimburse the recipient or party for the purchase of the
property or services; or
(2) For the payment of money (including money representing grants,
cooperative agreements, loans, insurance, or benefits) if the United
States:
(i) Provided any portion of the money requested or demanded;
(ii) Will reimburse the recipient or party for any portion of the
money paid on that request or demand; or
(iii) Will guarantee or reinsure any portion of a loan made by the
party; or
(c) Made to the Department which has the effect of decreasing an
obligation to pay or account for property, services, or money.
(Authority: 31 U.S.C. 3801(a)(3))
Complaint means the administrative complaint served by the reviewing
official on the defendant under Sec. 33.7.
(Authority: 31 U.S.C. 3809)
Defendant means any person alleged in a complaint under Sec. 33.7
to be liable for a civil penalty or assessment under Sec. 33.3.
(Authority: 31 U.S.C. 3809)
Department means the United States Department of Education.
(Authority: 31 U.S.C. 3809)
Department head means the Secretary or Under Secretary of the United
States Department of Education.
(Authority: 31 U.S.C. 3801(a)(2))
Government means the United States Government.
(Authority: 31 U.S.C. 3809)
Individual means a natural person.
(Authority: 31 U.S.C. 3809)
Initial decision means the written decision of the ALJ required by
Sec. 33.10 or Sec. 33.37, and includes a revised initial decision
issued following a remand or a motion for reconsideration.
(Authority: 31 U.S.C. 3803(h))
[[Page 73]]
Investigating official means the Inspector General of the Department
or an officer or employee of the Office of the Inspector General
designated by the Inspector General and serving in a position for which
the rate of basic pay is not less than the minimum rate of basic pay for
grade GS-16 under the General Schedule.
(Authority: 31 U.S.C. 3801(4)(A)(i))
Knows or has reason to know, means that a person, with respect to a
claim or statement:
(a) Has actual knowledge that the claim or statement is false,
fictitious, or fraudulent;
(b) Acts in deliberate ignorance of the truth or falsity of the
claim or statement; or
(c) Acts in reckless disregard of the truth or falsity of the claim
or statement.
(Authority: 31 U.S.C. 3801(5))
Makes includes the terms presents, submits, and causes to be made,
presented, or submitted.
(Authority: 31 U.S.C. 3802(a))
Person means any individual, partnership, corporation, association,
or private organization.
(Authority: 31 U.S.C. 3801(a)(6))
Representative means:
(a) An attorney who is a member in good standing of the bar of any
State, territory, possession of the United States, the District of
Columbia, or the Commonwealth of Puerto Rico; or
(b) Any other person designated by a party in writing, provided that
the designation includes a certification that the party understands the
nature and consequences of an administrative enforcement action under
this part, and that he or she has the right to representation by counsel
or to self-representation.
(Authority: 31 U.S.C. 3803(g)(2)(F))
Reviewing official means the General Counsel of the Department or
his or her designee who is:
(a) Not subject to supervision by, or required to report to, the
investigating official; and
(b) Not employed in the organizational unit of the Department in
which the investigating official is employed; and
(c) Serving in a position for which the rate of basic pay is not
less than the minimum rate of basic pay for grade GS-16 under the
General Schedule.
(Authority: 31 U.S.C. 3801(8))
Statement means any representation, certification, affirmation,
document, record, or accounting or bookkeeping entry made:
(a) With respect to a claim or to obtain the approval or payment of
a claim (including relating to eligibility to make a claim); or
(b) With respect to (including relating to eligibility for):
(1) A contract with, or a bid or proposal for a contract with; or
(2) A grant, cooperative agreement, loan, or benefit from;
The Department, or any State, political subdivision of a State, or other
party, if the United States Government provides any portion of the money
or property under the contract or for the grant, loan, cooperative
agreement, or benefit, or if the Government will reimburse or reinsure
the State, political subdivision, or party for any portion of the money
or property under the contract or for the grant, cooperative agreement,
loan, or benefit.
(Authority: 31 U.S.C. 3801(9))
Sec. 33.3 Basis for civil penalties and assessments.
(a) Claims. (1) Any person who makes a claim that the person knows
or has reason to know:
(i) Is false, fictitious, or fraudulent;
(ii) Includes or is supported by any written statement which asserts
a material fact which is false, fictitious, or fraudulent;
(iii) Includes or is supported by any written statement that:
(A) Omits a material fact;
(B) Is false, fictitious, or fraudulent as a result of such
omission; and
(C) Is a statement in which the person making such statement has a
duty to include such material fact; or
(iv) Is for payment for the provision of property or services which
the person has not provided as claimed;
[[Page 74]]
shall be subject, in addition to any other remedy that may be prescribed
by law, to a civil penalty of not more than $5,000 for each claim.
(2) Each voucher, invoice, claim form, or other individual request
or demand for property, services, or money constitutes a separate claim.
(3) A claim is considered made to the Department, a recipient, or
party when that claim is actually made to an agent, fiscal intermediary,
or other entity, including any State or political subdivision thereof,
acting for or on behalf of the Department, a recipient, or party.
(4) Each claim for property, services, or money is subject to a
civil penalty regardless of whether the property, services, or money is
actually delivered or paid.
(5) If the Government has made any payment (including transferred
property or provided services) on a claim, a person subject to a civil
penalty under paragraph (a)(1) of this section is also subject to an
assessment of not more than twice the amount of that claim or that
portion thereof that is determined to be in violation of paragraph
(a)(1) of this section. The assessment is in lieu of damages sustained
by the Government because of that claim.
(Authority: 31 U.S.C. 3802(a)(1))
(b) Statements. (1) Any person who makes a written statement that:
(i) The person knows or has reason to know:
(A) Asserts a material fact which is false, fictitious, or
fraudulent; or
(B) Is false, fictitious, or fraudulent because it omits a material
fact that the person making the statement has a duty to include in the
statement; and
(ii) Contains or is accompanied by an express certification or
affirmation of the truthfulness and accuracy of the contents of the
statement;
shall be subject, in addition to any other remedy that may be prescribed
by law, to a civil penalty of not more than $5,000 for each statement.
(2) Each written representation, certification, or affirmation
constitutes a separate statement.
(3) A statement is considered made to the Department when the
statement is actually made to an agent, fiscal intermediary, or other
entity, including any State or political subdivision thereof, acting for
or on behalf of the Department.
(Authority: 31 U.S.C. 3802(a)(2))
(c) No proof of specific intent to defraud is required to establish
liability under this section.
(Authority: 31 U.S.C. 3801(5))
(d) In any case in which it is determined that more than one person
is liable for making a claim or statement under this section, each of
those persons may be held liable for a civil penalty under this section.
(Authority: 31 U.S.C. 3802(a))
(e) In any case in which it is determined that more than one person
is liable for making a claim under this section of which the Government
has made payment (including transferred property or provided services),
an assessment may be imposed against any of those persons or jointly and
severally against any combination of those persons.
(Authority: 31 U.S.C. 3802(a)(1); 3809)
Sec. 33.4 Investigation.
(a) If an investigating official concludes that a subpoena pursuant
to the authority conferred by 31 U.S.C. 3604(a) is warranted:
(1) The subpoena so issued must notify the person to whom it is
addressed of the authority under which the subpoena is issued and must
identify the records or documents sought;
(2) The investigating official may designate a person to act on his
or her behalf to receive the documents sought; and
(3) The person receiving the subpoena is required to tender to the
investigating official or the person designated to receive the documents
a certification that the documents sought have been produced, or that
the documents are not available and the reasons therefore, or that the
documents, suitably identified, have been withheld based upon the
assertion of an identified privilege.
(Authority: 31 U.S.C. 3804(a))
[[Page 75]]
(b) If the investigating official concludes that an action under the
Program Fraud Civil Remedies Act may be warranted, the investigating
official shall submit a report containing the findings and conclusions
of the investigation to the reviewing official.
(Authority: 31 U.S.C. 3803(a)(1))
(c) Nothing in this section precludes or limits an investigating
official's discretion to refer allegations directly to the Department of
Justice for suit under the False Claims Act or other civil relief, or to
defer or postpone a report or referral to the reviewing official to
avoid interference with a criminal investigation or prosecution.
(Authority: 31 U.S.C. 3809)
(d) Nothing in this section modifies any responsibility of an
investigating official to report violations of criminal law to the
Attorney General.
(Authority: 31 U.S.C. 3803(a)(1))
Sec. 33.5 Review by the reviewing official.
(a) If, based on the report of the investigating official under
Sec. 33.4(b), the reviewing official determines that there is adequate
evidence to believe that a person is liable under Sec. 33.3 of this
part, the reviewing official transmits to the Attorney General a written
notice of the reviewing official's intention to issue a complaint under
Sec. 33.7.
(b) The notice must include--
(1) A statement of the reviewing official's reasons for issuing a
complaint;
(2) A statement specifying the evidence that supports the
allegations of liability;
(3) A description of the claims or statements upon which the
allegations of liability are based;
(4) An estimate of the amount of money or the value of property,
services, or other benefits requested or demanded in violation of Sec.
33.3;
(5) A statement of any exculpatory or mitigating circumstances that
may relate to the claims or statements known by the reviewing official
or the investigating official; and
(6) A statement that there is a reasonable prospect of collecting an
appropriate amount of penalties and assessments. Such a statement may be
based upon information then known or an absence of any information
indicating that the person may be unable to pay such an amount.
(Authority: 31 U.S.C. 3803(a)(2); 3809(2))
Sec. 33.6 Prerequisites for issuing a complaint.
(a) The reviewing official may issue a complaint under Sec. 33.7
only if--
(1) The Department of Justice approves the issuance of a complaint
in a written statement described in 31 U.S.C. 3803(b)(1); and
(2) In the case of allegations of liability under Sec. 33.3(a) with
respect to a claim, the reviewing official determines that, with respect
to that claim or a group of related claims submitted at the same time
the claim is submitted (as defined in paragraph (b) of this section),
the amount of money or the value of property or services demanded or
requested in violation of Sec. 33.3(a) does not exceed $150,000.
(b) For the purposes of this section, a related group of claims
submitted at the same time includes only those claims arising from the
same transaction (e.g., grant, cooperative agreement, loan, application,
or contract) that are submitted simultaneously as part of a single
request, demand, or submission.
(c) Nothing in this section may be construed to limit the reviewing
official's authority to join in a single complaint against a person
claims that are unrelated or were not submitted simultaneously,
regardless of the amount of money, or the value of property or services,
demanded or requested.
(Authority: 31 U.S.C. 3803(b), (c))
Sec. 33.7 Complaint.
(a) On or after the date the Department of Justice approves the
issuance of a complaint in accordance with 31 U.S.C. 3803(b)(1), the
reviewing official may serve a complaint on the defendant, as provided
in Sec. 33.8.
(b) The complaint must state:
(1) The allegations of liability against the defendant, including
the statutory basis for liability, an identification of the claims or
statements
[[Page 76]]
that are the basis for the alleged liability, and the reasons why
liability allegedly arises from those claims or statements;
(2) The maximum amount of penalties and assessments for which the
defendant may be held liable;
(3) Instructions for filing an answer to request a hearing,
including a specific statement of the defendant's right to request a
hearing by filing an answer and to be represented by a representative;
and
(4) That failure to file an answer within 30 days of service of the
complaint will result in the imposition of the maximum amount of
penalties and assessments without right to appeal, as provided in Sec.
33.10.
(c) At the same time the reviewing official serves the complaint, he
or she shall serve the defendant with a copy of the regulations in this
part.
(Authority: 31 U.S.C. 3803(a))
Sec. 33.8 Service of complaint.
(a) Service of a complaint must be made by certified or registered
mail or by delivery in any manner authorized by Rule 4(d) of the Federal
Rules of Civil Procedure. Service is complete upon receipt.
(b) Proof of service, stating the name and address of the person on
whom the complaint was served, and the manner and date of service, may
be made by:
(1) Affidavit of the individual serving the complaint by delivery;
(2) An acknowledged United States Postal Service return receipt
card; or
(3) Written acknowledgment of receipt by the defendant or his
representative.
(Authority: 31 U.S.C. 3802(d))
Sec. 33.9 Answer.
(a) The defendant may request a hearing by filing an answer with the
reviewing official within 30 days of service of the complaint. An answer
is deemed to be a request for hearing.
(b) In the answer, the defendant:
(1) Shall admit or deny each of the allegations of liability made in
the complaint;
(2) Shall state any defense on which the defendant intends to rely;
(3) May state any reasons why the defendant contends that the
penalties and assessments should be less than the statutory maximum; and
(4) Shall state the name, address, and telephone number of the
person authorized by the defendant to act as defendant's representative,
if any.
(c) If the defendant is unable to file an answer meeting the
requirements of paragraph (b) of this section within the time provided,
the defendant may, before the expiration of 30 days from service of the
complaint, file with the reviewing official a general answer denying
liability and requesting a hearing, and a request for an extension of
time within which to file an answer meeting the requirements of
paragraph (b) of this section. The reviewing official shall file
promptly with the ALJ the complaint, the general answer denying
liability, and the request for an extension of time as provided in Sec.
33.11 for good cause shown, the ALJ may grant the defendant up to 30
additional days within which to file an answer meeting the requirements
of paragraph (b) of this section.
(Authority: 31 U.S.C. 3803(d)(2), 3809)
Sec. 33.10 Default upon failure to file an answer.
(a) If the defendant does not file an answer within the time
prescribed in Sec. 33.9(a), the reviewing official may refer the
complaint to the ALJ.
(b) Upon the referral of the complaint, the ALJ shall promptly serve
on defendant in the manner prescribed in Sec. 33.8, a notice that an
initial decision will be issued under this section.
(c) The ALJ shall assume the facts alleged in the complaint to be
true and, if those facts establish liability under Sec. 33.3, the ALJ
shall issue an initial decision imposing the maximum amount of penalties
and assessments allowed under the statute.
(d) Except as otherwise provided in this section, by failing to file
a timely answer the defendant waives any right to further review of the
penalties and assessments imposed under paragraph (c) of this section,
and the initial decision becomes final and binding upon the parties 30
days after it is issued.
(e) If, before such an initial decision becomes final, the defendant
files a
[[Page 77]]
motion with the ALJ seeking to reopen on the grounds that extraordinary
circumstances prevented the defendant from filing an answer, the initial
decision must be stayed pending the ALJ's decision on the motion.
(f) If, on such a motion, the defendant can demonstrate
extraordinary circumstances excusing the failure to file a timely
answer, the ALJ shall withdraw the initial decision under paragraph (c)
of this section, if such a decision has been issued, and shall grant the
defendant an opportunity to answer the complaint.
(g) A decision of the ALJ denying a defendant's motion under
paragraph (e) of this section is not subject to reconsideration under
Sec. 33.38.
(h) The defendant may appeal to the Department head the decision
denying a motion to reopen by filing a notice of appeal with the
Department head within 15 days after the ALJ denies the motion. The
timely filing of a notice of appeal stays the initial decision until the
Department head decides the issue.
(i) If the defendant files a timely notice of appeal with the
Department head, the ALJ shall forward the record of the proceeding to
the Department head.
(j) The Department head decides expeditiously whether extraordinary
circumstances excuse the defendant's failure to file a timely answer
based solely on the record before the ALJ.
(k) If the Department head decides that extraordinary circumstances
excuse the defendant's failure to file a timely answer, the Department
head remands the case to the ALJ with instructions to grant the
defendant an opportunity to answer.
(l) If the Department head decides that the defendant's failure to
file a timely answer is not excused, the Department head reinstates the
initial decision of the ALJ, which becomes final and binding upon the
parties 30 days after the Department head issues that decision.
(Authority: 31 U.S.C. 3809)
Sec. 33.11 Referral of complaint and answer to the ALJ.
Upon receipt of an answer, the reviewing official shall file the
complaint and answer with the ALJ.
(Authority: 31 U.S.C. 3803(d)(2); 3809)
Sec. 33.12 Notice of hearing.
(a) When the ALJ receives the complaint and answer, the ALJ shall
promptly serve a notice of hearing upon the defendant in the manner
prescribed by Sec. 33.8. At the same time, the ALJ shall send a copy of
the notice to the representative for the Government.
(b) The notice must include:
(1) The tentative time and place, and the nature of the hearing;
(2) The legal authority and jurisdiction under which the hearing is
to be held;
(3) The matters of fact and law to be asserted;
(4) A description of the procedures for the conduct of the hearing;
(5) The name, address, and telephone number of the representative of
the Government and of the defendant, if any; and
(6) Such other matters as the ALJ deems appropriate.
(Authority: 31 U.S.C. 3803(g)(2)(A))
Sec. 33.13 Parties to the hearing.
(a) The parties to the hearing are the defendant and the Department.
(b) Pursuant to 31 U.S.C. 3730(c)(5), a private plaintiff under the
False Claims Act may participate in these proceedings to the extent
authorized by the provisions of that Act.
(Authority: 31 U.S.C. 3803(g)(2))
Sec. 33.14 Separation of functions.
(a) The investigating official, the reviewing official, and any
employee or agent of the Department who takes part in investigating,
preparing, or presenting a particular case may not, in that case or a
factually related case:
(1) Participate in the hearing as the ALJ;
(2) Participate or advise in the initial decision or the review of
the initial decision by the Department head, except as a witness or a
representative in public proceedings; or
[[Page 78]]
(3) Make the collection of penalties and assessments under 31 U.S.C.
3806.
(b) The ALJ may not be responsible to, or subject to the supervision
or direction of, the investigating official or the reviewing official.
(c) Except as provided in paragraph (a) of this section, the
representative for the Government may be employed anywhere in the
Department, including in the offices of either the investigating
official or the reviewing official.
(Authority: 31 U.S.C. 3809(l)(2))
Sec. 33.15 Ex parte contacts.
No party or person (except employees of the ALJ's office) may
communicate in any way with the ALJ on any matter at issue in a case,
unless on notice and opportunity for all parties to participate. This
provision does not prohibit a person or party from inquiring about the
status of a case or asking routine questions concerning administrative
functions or procedures.
(Authority: 31 U.S.C. 3803(g)(1)(A))
Sec. 33.16 Disqualification of reviewing official or ALJ.
(a) A reviewing official or ALJ in a particular case may disqualify
himself or herself at any time.
(b) A party may file with the ALJ a motion for disqualification of a
reviewing official or an ALJ. That motion must be accompanied by an
affidavit alleging personal bias or other reason for disqualification.
(c) The motion and affidavit must be filed promptly upon the party's
discovery of reasons requiring disqualification, or the objections are
deemed waived.
(d) The affidavit must state specific facts that support the party's
belief that personal bias or other reason for disqualification exists
and the time and circumstances of the party's discovery of those facts.
It must be accompanied by a certificate of the representative of record
that it is made in good faith.
(e) Upon the filing of the motion and affidavit, the ALJ shall not
proceed further in the case until he or she resolves the matter of
disqualification in accordance with paragraph (f) of this section.
(f)(1) If the ALJ determines that a reviewing official is
disqualified, the ALJ shall dismiss the complaint without prejudice.
(2) If the ALJ disqualifies himself or herself, the case must be
reassigned promptly to another ALJ.
(3) If the ALJ denies a motion to disqualify, the Department head
may determine the matter only as part of his or her review of the
initial decision upon appeal, if any.
(Authority: 31 U.S.C. 3803(g)(2)(G))
Sec. 33.17 Rights of parties.
Except as otherwise limited by this part, all parties may:
(a) Be accompanied, represented, and advised by a representative (as
defined in Sec. 33.2);
(b) Participate in any conference held by the ALJ:
(c) Conduct discovery under Sec. 33.21;
(d) Agree to stipulations of fact or law, which must be made part of
the record;
(e) Present evidence relevant to the issues at the hearing;
(f) Present and cross-examine witnesses;
(g) Present oral arguments at the hearing as permitted by the ALJ;
and
(h) Submit written briefs and proposed findings of fact and
conclusions of law after the hearing.
(Authority: 31 U.S.C. 3803(g) (2) (E), (F), (3)(B)(ii))
Sec. 33.18 Authority of the ALJ.
(a) The ALJ shall conduct a fair and impartial hearing, avoid delay,
maintain order, and assure that a record of the proceeding is made.
(b) The ALJ has the authority to:
(1) Set and change the date, time, and place of the hearing upon
reasonable notice to the parties;
(2) Disqualify a non-attorney representative (designated as
described in the Sec. 33.2 definitions of ``representative'') if the
ALJ determines that the representative is incapable of rendering
reasonably effective assistance;
(3) Continue or recess the hearing in whole or in part for a
reasonable period of time;
[[Page 79]]
(4) Hold conferences to identify or simplify the issues, or to
consider other matters that may aid in the expeditious disposition of
the proceeding;
(5) Administer oaths and affirmations;
(6) Issue subpoenas requiring the attendance of witnesses and the
production of documents at depositions or at hearings;
(7) Rule on motions and other procedural matters;
(8) Regulate the scope and timing of discovery;
(9) Regulate the course of the hearing and the conduct of
representatives and parties;
(10) Examine witnesses;
(11) Receive, rule on, exclude, or limit evidence;
(12) Upon motion of a party, take official notice of facts;
(13) Upon motion of a party, decide cases, in whole or in part, by
summary judgment if there is no disputed issue of material fact;
(14) Conduct any conference, argument, or hearing on motions in
person or by telephone; and
(15) Exercise such other authority as is necessary to carry out the
responsibilities of the ALJ under this part.
(c) The ALJ does not have the authority to find Federal statutes or
regulations invalid.
(Authority: 31 U.S.C. 3803(g))
Sec. 33.19 Prehearing conferences.
(a) The ALJ may schedule perhearing conferences as appropriate.
(b) Upon the motion of any party, the ALJ shall schedule at least
one perhearing conference at a reasonable time in advance of the
hearing.
(c) The ALJ may use prehearing conferences to discuss the following:
(1) Simplification of the issues.
(2) The necessity or desirability of amendments to the pleadings,
including the need for a more definite statement.
(3) Stipulations, admissions of fact or as to the contents and
authenticity of documents.
(4) Whether the parties can agree to submission of the case on a
stipulated record.
(5) Whether a party chooses to waive appearance at an oral hearing
and to submit only documentary evidence (subject to the objection of
other parties) and written argument.
(6) Limitation of the number of witnesses.
(7) Scheduling dates for the exchange of witness lists and of
proposed exhibits.
(8) Discovery.
(9) The time and place for the hearing.
(10) Such other matters as may tend to expedite the fair and just
disposition of the proceedings.
(d) The ALJ may issue an order containing all matters agreed upon by
the parties or ordered by the ALJ at a prehearing conference.
(Authority: 31 U.S.C. 3803(g))
Sec. 33.20 Disclosure of documents.
(a) Upon written request to the reviewing official, the defendant
may review any relevant and material documents, transcripts, records,
and other materials that relate to the allegations set out in the
complaint and upon which the findings and conclusions of the
investigating official under Sec. 33.4(b) are based, unless those
documents are subject to a privilege under Federal law. Upon payment of
fees for duplication, the defendant may obtain copies of the documents.
(b) Upon written request to the reviewing official, the defendant
also may obtain a copy of all exculpatory information in the possession
of the reviewing official or investigating official relating to the
allegations in the complaint, even if it is contained in a document that
would otherwise be privileged. If the document would otherwise be
privileged, only that portion containing exculpatory information must be
disclosed.
(c) The notice sent to the Attorney General from the reviewing
official as described in Sec. 33.5 is not discoverable under any
circumstances.
(d) The defendant may file a motion to compel disclosure of the
documents subject to the provisions of this section. Such a motion may
only be filed with the ALJ following the filing of an answer pursuant to
Sec. 33.9.
(Authority: 31 U.S.C. 3803(g)(3)(B)(ii), 3803(e))
[[Page 80]]
Sec. 33.21 Discovery.
(a) The following types of discovery are authorized:
(1) Requests for production of documents for inspection and copying.
(2) Requests for admissions of the authenticity of any relevant
document or of the truth of any relevant fact.
(3) Written interrogatories.
(4) Depositions.
(b) For the purpose of this section and Sec. Sec. 33.22 and 33.23,
the term ``documents'' includes information, documents, reports,
answers, records, accounts, papers, and other data and documentary
evidence. Nothing contained in this part may be interpreted to require
the creation of a document.
(c) Unless mutually agreed to by the parties, discovery is available
only as ordered by the ALJ. The ALJ shall regulate the timing of
discovery.
(d) Motions for discovery. (1) A party seeking discovery may file a
motion with the ALJ. Such a motion shall be accompanied by a copy of the
requested discovery, or in the case of depositions, a summary of the
scope of the proposed deposition.
(2) Within ten days of service, a party may file an opposition to
the motion or a motion for protective order, or both, as provided in
Sec. 33.24.
(3) The ALJ may grant a motion for discovery only if he finds that
the discovery sought:
(i) Is necessary for the expeditious, fair, and reasonable
determination of the issues;
(ii) Is not unduly costly or burdensome;
(iii) Will not unduly delay the proceeding; and
(iv) Does not seek privileged information.
(4) The burden of showing that discovery should be allowed is on the
party seeking discovery.
(5) The ALJ may grant discovery subject to a protective order under
Sec. 33.24.
(Authority: 31 U.S.C. 3803(a)(3)(B)(ii))
(e) Depositions. (1) If a motion for deposition is granted, the ALJ
shall issue a subpoena for the deponent, which may require the deponent
to produce documents. The subpoena must specify the time and place at
which the deposition will be held.
(2) The party seeking to depose shall serve the subpoena in the
manner prescribed in Sec. 33.8.
(3) The deponent may file with the ALJ a motion to quash the
subpoena or a motion for a protective order within ten days of service.
(4) The party seeking to depose shall provide for the taking a
verbatim transcript of the deposition, which the party shall make
available to all other parties for inspection and copying.
(f) Each party shall bear its own costs of discovery.
(Authority: 31 U.S.C. 3803(g)(3)(B)(ii))
Sec. 33.22 Exchange of witness lists, statements and exhibits.
(a) At least 15 days before the hearing or at such other time as may
be ordered by the ALJ, the parties shall exchange witness lists, copies
of prior statements of proposed witnesses, and copies of proposed
hearing exhibits, including copies of any written statements that the
party intends to offer in lieu of live testimony in accordance with
Sec. 33.33(b). At the time these documents are exchanged, any party
that is permitted by the ALJ to rely on the transcript of deposition
testimony in lieu of live testimony at the hearing, shall provide each
other party with a copy of the specific pages of the transcript it
intends to introduce.
(b) If a party objects, the ALJ shall not admit into evidence the
testimony of any witness whose name does not appear on the witness list
or any exhibit not provided to the opposing party as provided in
paragraph (a) of this Section unless the ALJ finds good cause for the
failure or that there is no prejudice to the objecting party.
(c) Unless another party objects within the time set by the ALJ,
documents exchanged in accordance with paragraph (a) of this section are
deemed to be authentic for the purpose of admissibility at the hearing.
(Authority: 31 U.S.C. 3803(g)(2))
Sec. 33.23 Subpoenas for attendance at hearing.
(a) A party wishing to procure the appearance and testimony of any
individual at the hearing may request that the ALJ issue a subpoena.
[[Page 81]]
(b) A subpoena requiring the attendance and testimony of an
individual may also require the individual to produce documents at the
hearing.
(c) A party seeking a subpoena shall file a written request therefor
not less than 15 days before the date fixed for the hearing unless
otherwise allowed by the ALJ for good cause shown. The request must
specify any documents to be produced and must designate the witnesses
and describe their address and location with sufficient particularity to
permit the witnesses to be found.
(d) The subpoena must specify the time and place at which a witness
is to appear and any documents the witness is to produce.
(e) The party seeking the subpoena shall serve it in the manner
prescribed in Sec. 33.8. A subpoena on a party or upon an individual
under the control of a party may be served by first class mail.
(f) A party or the individual to whom the subpoena is directed may
file with the ALJ a motion to quash the subpoena within ten days after
service or on or before the time specified in the subpoena for
compliance if is is less then ten days after service.
(Authority: 31 U.S.C. 3804(b))
Sec. 33.24 Protective order.
(a) A party or a prospective witness or deponent may file a motion
for a protective order with respect to discovery sought by an opposing
party or with respect to the hearing, seeking to limit the availability
or disclosure of evidence.
(b) In issuing a protective order, the ALJ may take any order which
justice requires to protect a party or person from annoyance,
embarrassment, oppression, or undue burden or expense, including one or
more of the following:
(1) That the discovery not be had.
(2) That the discovery may be had only on specified terms and
conditions, including a designation of the time or place.
(3) That the discovery may be had only through a method of discovery
other than that requested.
(4) That certain matters not be inquired into, or that the scope of
discovery be limited to certain matters.
(5) That the discovery be conducted with no one present except
persons designated by the ALJ.
(6) That the contents of discovery or evidence be sealed.
(7) That a deposition after being sealed be opened only by order of
the ALJ.
(8) That a trade secret or other confidential research, development,
commercial information, or facts pertaining to any criminal
investigation, proceeding, or other administrative investigation not be
disclosed or be disclosed only in a designated way.
(9) That the parties simultaneously file specified documents or
information enclosed in sealed envelopes to be opened as directed by the
ALJ.
(Authority: 31 U.S.C. 3803(g)(3)(B)(ii))
Sec. 33.25 Fees.
The party requesting a subpoena shall pay the cost of the fees and
mileage of any witness subpoenaed in the amounts that would be payable
to a witness in a proceeding in United States District Court. A check
for witness fees and mileage must accompany the subpoena when served,
except that if a subpoena is issued on behalf of the authority, a check
for witness fees and mileage need not accompany the subpoena.
(Authority: 31 U.S.C. 3804(b))
Sec. 33.26 Form, filing and service of papers.
(a) Form. (1) Documents filed with the ALJ must include an original
and two copies.
(2) Every pleading and paper filed in the proceeding must contain a
caption setting for the title of the action, the case number assigned by
the ALJ, and a designation of the paper (e.g., motion to quash
subpoena).
(3) Every pleading and paper must be signed by, and must contain the
address and telephone number of the party or the person on whose behalf
the paper was filed, or his or her representative.
(4) Papers are considered filed when they are mailed. Date of
mailing may be established by a certificate from the party or its
representative or by proof
[[Page 82]]
that the document was sent by certified or registered mail.
(b) Service. A party filing a document with the ALJ shall, at the
time of filing, serve a copy of the document on every other party.
Service upon any party of any document other than those required to be
served as prescribed in Sec. 33.8 shall be made by delivering a copy,
or by placing a copy of the document in the United States mail, postage
prepaid and addressed, to the party's last known address. If a party is
represented by a representative, service must be made upon the
representative in lieu of the actual party.
(c) Proof of service. A certificate of the individual serving the
document by personal delivery or by mail, setting forth the manner of
service, is proof of service.
(Authority: 31 U.S.C. 3803(b)(3)(A))
Sec. 33.27 Computation of time.
(a) In computing any period of time under this part or in an order
issued under this part, the time begins with the day following the act,
event, or default, and includes the last day of the period, unless it is
a Saturday, Sunday, or legal holiday observed by the Federal Government,
in which event it includes the next business day.
(b) If the period of time allowed is less than seven days,
intermediate Saturdays, Sundays, and legal holidays observed by the
Federal Government are excluded from the computation.
(c) If a document has been served or issued by placing it in the
mail, an additional five days is added to the time permitted for any
response.
(Authority: 31 U.S.C. 3809)
Sec. 33.28 Motions.
(a) Any application to the ALJ for an order or ruling must be by
motion. Motions must state the relief sought, the authority relied upon,
and the facts alleged, and must be filed with the ALJ and served on all
other parties.
(b) Except for motions made during a prehearing conference or at the
hearing, all motions must be in writing. The ALJ may require that oral
motions be reduced to writing.
(c) Within 15 days after a written motion is served, or such other
time as may be fixed by the ALJ, any party may file a response to the
motion.
(d) The ALJ may not grant a written motion before the time for
filing responses to the motion has expired, except upon consent of the
parties or following a hearing on the motion, but may overrule or deny
the motion without awaiting a response.
(e) The ALJ shall make a reasonable effort to dispose of all
outstanding motions prior to the beginning of the hearing.
(Authority: 31 U.S.C. 3803(g)(3)(A))
Sec. 33.29 Sanctions.
(a) The ALJ may sanction a person, including any party or
representative for--
(1) Failing to comply with an order, rule, or procedure governing
the proceeding;
(2) Failing to prosecute or defend an action; or
(3) Engaging in other misconduct that interferes with the speedy,
orderly, or fair conduct of the hearing.
(b) Any sanction, including but not limited to those listed in
paragraphs (c), (d), and (e) of this section must reasonably relate to
the severity and nature of the failure or misconduct.
(c) If a party fails to comply with an order, including an order for
taking a deposition, the production of evidence within the party's
control, or a request for admission, the ALJ may--
(1) Draw an inference in favor of the requesting party with regard
to the information sought;
(2) In the case of requests for admission, deem each matter of which
an admission is requested to be admitted;
(3) Prohibit the party failing to comply with the order from
introducing evidence concerning, or otherwise relying upon testimony
relating to, the information sought; and
(4) Strike any part of the pleadings or other submissions of the
party failing to comply with the request.
(d) If a party fails to prosecute or defend an action under this
part commenced by service of a notice of hearing, the ALJ may dismiss
the action or may issue an initial decision imposing penalties and
assessments.
[[Page 83]]
(e) The ALJ may refuse to consider any motion, request, response,
brief, or other document that is not filed in a timely fashion.
(Authority: 31 U.S.C. 3803(g)(2))
Sec. 33.30 The hearing and burden of proof.
(a) The ALJ shall conduct a hearing on the record in order to
determine whether the defendant is liable for a civil penalty or
assessment under Sec. 33.3 and, if so, the appropriate amount of the
civil penalty or assessment considering any aggravating or mitigating
factors.
(b) The Department shall prove a defendant's liability and any
aggravating factors by a preponderance of the evidence.
(c) The defendant shall prove any affirmative defenses and any
mitigating factors by a preponderance of the evidence.
(d) The hearing must be open to the public unless otherwise ordered
by the ALJ for good cause shown.
(Authority: 31 U.S.C. 3803 (f), (g)(2))
Sec. 33.31 Determining the amount of penalties and assessments.
(a) In determining an appropriate amount of civil penalties and
assessments, the ALJ and the Department head, upon appeal, evaluate any
circumstances that mitigate or aggravate the violation and articulate in
their opinions the reasons that support the penalties and assessments
they impose. Because of the intangible costs of fraud, the expense of
investigating fraudulent conduct, and the need to deter others who might
be similarly tempted, ordinarily double damages and a significant civil
penalty is imposed.
(b) Although not exhaustive, the following factors are among those
that may influence the ALJ and the Department head in determining the
amount of penalties and assessments to impose with respect to the
misconduct (i.e., the false, fictitious, or fraudulent claims or
statements) charged in the complaint:
(1) The number of false, fictitious, or fraudulent claims or
statements.
(2) The time period over which such claims or statements were made.
(3) The degree of the defendent's culpability with respect to the
misconduct.
(4) The amount of money or the value of the property, services, or
benefit falsely claimed.
(5) The value of the Government's actual loss as a result of the
misconduct, including foreseeable consequential damages and the costs of
investigation.
(6) The relationship of the amount imposed as civil penalties to the
amount of the Government's loss.
(7) The potential or actual impact of the misconduct upon national
defense, public health or safety, or public confidence in the management
of Government programs and operations, including particularly the impact
on the intended beneficiaries of such programs.
(8) Whether the defendant has engaged in a pattern of the same or
similar misconduct.
(9) Whether the defendant attempted to conceal the misconduct.
(10) The degree to which the defendant has involved others in the
misconduct or in concealing it.
(11) If the misconduct of employees or agents is imputed to the
defendant, the extent to which the defendant's practices fostered or
attempted to preclude the misconduct.
(12) Whether the defendant cooperated in or obstructed an
investigation of the misconduct.
(13) Whether the defendant assisted in identifying and prosecuting
other wrongdoers.
(14) The complexity of the program or transaction, and the degree of
the defendant's sophistication with respect to it, including the extent
of the defendant's prior participation in the program or in similar
transactions.
(15) Whether the defendant has been found, in any criminal, civil,
or administrative proceeding to have engaged in similar misconduct or to
have dealt dishonestly with the Government of the United States or of a
State, directly or indirectly.
(16) The need to deter the defendant and others from engaging in the
same or similar misconduct.
[[Page 84]]
(c) Nothing in this section may be construed to limit the ALJ or the
Department head from considering any other factors that in any given
case may mitigate or aggravate the offense for which penalties and
assessments are imposed.
(Authority: 31 U.S.C. 3803(a)(2) (e), (f))
Sec. 33.32 Location of hearing.
(a) The hearing may be held:
(1) In any judicial district of the United States in which the
defendant resides or transacts business;
(2) In any judicial district of the United States in which the claim
or statement in issue was made; or
(3) In such other place as may be agreed upon by the defendant and
the ALJ.
(b) Each party must have the opportunity to present argument with
respect to the location of the hearing.
(c) The hearing must be held at the place and at the time ordered by
the ALJ.
(Authority: 31 U.S.C. 3803(g)(4))
Sec. 33.33 Witnesses.
(a) Except as provided in paragraph (b) of this section, testimony
at the hearing must be given orally by witnesses under oath or
affirmation.
(b) At the discretion of the ALJ, testimony may be admitted in the
form of a written statement or deposition. Any such written statement
must be provided to all other parties along with the last known address
of the witness, in a manner that allows sufficient time for other
parties to subpoena the witness for cross-examination at the hearing.
Prior written statements of witnesses proposed to testify at the hearing
and deposition transcripts must be exchanged as provided in Sec.
33.22(a).
(c) The ALJ shall exercise reasonable control over the mode and
order of interrogating witnesses and presenting evidence so as to:
(1) Make the interrogation and presentation effective for the
ascertainment of the truth;
(2) Avoid needless consumption of time; and
(3) Protect witnesses from harassment or undue embarrassment.
(d) The ALJ shall permit the parties to conduct such cross-
examination as may be required for a full and true disclosure of the
facts.
(e) At the discretion of the ALJ, a witness may be cross-examined on
matters relevant to the proceeding without regard to the scope of his or
her direct examination. To the extent permitted by the ALJ, cross-
examination on matters outside the scope of direct examination must be
conducted in the manner of direct examination and may proceed by leading
questions only if the witness is a hostile witness, an adverse party, or
a witness identified with an adverse party.
(f) Upon motion of any party, the ALJ shall order witnesses excluded
so that they cannot hear the testimony of other witnesses. This rule
does not authorize exclusion of--
(1) A party who is an individual;
(2) In the case of a party that is not an individual, an officer or
employee of the party appearing for the party pro se or designated by
the party's representative; or
(3) An individual whose presence is shown by a party to be essential
to the presentation of its case, including an individual employed by the
Government engaged in assisting the representative for the Government.
(Authority: 31 U.S.C. 3803(g)(2)(E); 3809))
Sec. 33.34 Evidence.
(a) The ALJ shall determine the admissibility of evidence.
(b) Except as provided in this part, the ALJ is not bound by the
Federal Rules of Evidence. However, the ALJ may apply the Federal Rules
of Evidence if appropriate, e.g., to exclude unreliable evidence.
(c) The ALJ shall exclude irrelevant and immaterial evidence.
(d) Although relevant, evidence may be excluded if its probative
value is substantially outweighted by the danger of unfair prejudice,
confusion of the issues, or by considerations of undue delay or needless
presentation of cumulative evidence.
(e) Although relevant, evidence may be excluded if it is privileged
under Federal law.
(f) Evidence concerning offers of compromise or settlement are
inadmissible
[[Page 85]]
to the extend provided in Rule 408 of the Federal Rules of Evidence.
(g) The ALJ shall permit the parties to introduce rebuttal witnesses
and evidence.
(h) All Documents and other evidence offered or taken for the record
must be open to examination by all parties, unless otherwise ordered by
the ALJ pursuant to Sec. 33.24.
(Authority: 31 U.S.C. 3803(f)(g)(2)(E))
Sec. 33.35 The record.
(a) The hearing must be recorded and transcribed. Transcripts may be
obtained following the hearing from the ALJ at a cost not to exceed the
actual cost of duplication.
(Authority: 31 U.S.C. 3803 (f))
(b) The transcript of testimony, exhibits and other evidence
admitted at the hearing, and all papers and requests filed in the
proceeding constitute the record for the decision by the ALJ and the
Department head.
(c) The record may be inspected and copied (upon payment of a
reasonable fee) by anyone, unless otherwise ordered by the ALJ pursuant
to Sec. 33.24.
(Authority: 5 U.S.C. App. 2, section 11)
Sec. 33.36 Post-hearing briefs.
The ALJ may require the parties to file post-hearing briefs. In any
event, any party may file a post-hearing brief. The ALJ shall fix the
time for filing these briefs, not to exceed 60 days from the date the
parties receive the transcript of the hearing or, if applicable, the
stipulated record. The briefs may be accompanied by proposed findings of
fact and conclusions of law. The ALJ may permit the parties to file
reply briefs.
(Authority: 31 U.S.C. 3803 (g)(1)(2)(E))
Sec. 33.37 Initial decision.
(a) The ALJ shall issue an initial decision, based only on the
record, that contains findings of fact, conclusions of law, and the
amount of any penalties and assessments imposed.
(b) The findings of fact must include a finding on each of the
following issues:
(1) Whether the claims or statements identified in the complaint, or
any portions of the complaint, violate Sec. 33.3.
(2) If the person is liable for penalties or assessments, the
appropriate amount of any such penalties or assessments considering any
mitigating or aggravating factors that the ALJ finds in the case, such
as those described in Sec. 33.31.
(c) The ALJ shall promptly serve the initial decision on all parties
within 90 days after the time for submission of post-hearing briefs and
reply briefs (if permitted) has expired. The ALJ shall at the same time
serve all parties with a statement describing the right of any defendant
determined to be liable for a civil penalty or assessment to file a
motion for reconsideration with the ALJ or a notice of appeal with the
Department head. If the ALJ fails to meet the deadline contained in this
paragraph, he or she shall notify the parties of the reasons for the
delay and shall set a new deadline.
(d) Unless the initial decision of the ALJ is timely appealed to the
Department head, or a motion for reconsideration of the initial decision
is timely filed, the initial decision shall constitute the final
decision of the Department head and shall be final and binding on the
parties 30 days after it is issued by the ALJ.
(Authority: 31 U.S.C. 3803(h)(i))
Sec. 33.38 Reconsideration of initial decision.
(a) Except as provided in paragraph (d) of this section, any party
may file a motion for reconsideration of the initial decision within 20
days of receipt of the initial decision. If service was made by mail,
receipt is presumed to be five days from the date of mailing in the
absence of contrary proof.
(b) Every motion under paragraph (a) of this section must set forth
the matters claimed to have been erroneously decided and the nature of
the alleged errors. The motion must be accompanied by a supporting
brief.
(c) Responses to the motion are allowed only upon request to the
ALJ.
(d) No party may file a motion for reconsideration of an initial
decision that has been revised in response to a previous motion for
reconsideration.
[[Page 86]]
(e) The ALJ may dispose of a motion for reconsideration by denying
it or by issuing a revised initial decision.
(f) If the ALJ denies a motion for reconsideration, the initial
decision shall constitute the final decision of the Department head and
shall be final and binding on the parties 30 days after the ALJ denies
the motion, unless the initial decision is timely appealed to the
Department head in accordance with Sec. 33.39.
(g) If the ALJ issues a revised initial decision, that decision
shall constitute the final decision of the Department head and shall be
final and binding on the parties 30 days after it is issued, unless it
is timely appealed to the Department head in accordance with Sec.
33.39.
(Authority: 31 U.S.C. 3809)
Sec. 33.39 Appeal to Department head.
(a) Any defendant who has filed a timely answer and who is
determined in an initial decision to be liable for a civil penalty or
assessment may appeal the decision to the Department head by filing a
notice of appeal with the Department head in accordance with this
section.
(b)(1) A notice of appeal may be filed at any time within 30 days
after the ALJ issues a final decision. However, if another party files a
motion for reconsideration under Sec. 33.38, consideration of the
appeal shall be stayed automatically pending resolution of the motion
for reconsideration.
(2) If a motion for reconsideration is timely filed, a notice of
appeal may be filed within 30 days after the ALJ denies the motion or
issues a revised initial decision, whichever applies.
(3) The Department head may extend the initial 30-day period for an
additional 30 days if the defendant files with the Department head a
request for an extension within the initial 30-day period and shows good
cause.
(c) If the defendant files a timely notice of appeal with the
Department head, and the time for filing motions for reconsideration
under Sec. 33.38 has expired, the ALJ shall forward the record of the
proceeding to the Department head.
(d) A notice of appeal must be accompanied by a written brief
specifying exceptions to the initial decision and reasons supporting the
exceptions.
(e) The representative for the Government may file a brief in
opposition to exceptions within 30 days of receiving the notice of
appeal and accompanying brief.
(f) There is no right to appear personally before the Department
head.
(g) There is no right to appeal any interlocutory ruling by the ALJ.
(h) In reviewing the initial decision, the Department head does not
consider any objection that was not raised before the ALJ unless a
demonstration is made of extraordinary circumstances causing the failure
to raise the objection.
(i) If any party demonstrates to the satisfaction of the Department
head that additional evidence not presented at such hearing is material
and that there were reasonable grounds for the failure to present that
evidence at the hearing, the Department head shall remand the matter to
the ALJ for consideration of the additional evidence.
(j) The Department head affirms, reduces, reverses, compromises,
remands, or settles any penalty or assessment, determined by the ALJ in
any initial decision.
(Authority: 31 U.S.C. 3803(i))
(k) The Department head promptly serves each party to the appeal
with a copy of the decision of the Department head and a statement
describing the right of any person determined to be liable for a penalty
or assessment to seek judicial review.
(Authority: 31 U.S.C. 3803(i)(2))
(l) Unless a petition for review is filed as provided in 31 U.S.C.
3805, after a defendant has exhausted all administrative remedies under
this part and within 60 days after the date on which the Department head
serves the defendant with a copy of the Department head's decision, a
determination that a defendant is liable under Sec. 33.3 is final and
is not subject to judicial review.
(Authority: 31 U.S.C. 3805(a)(2))
[[Page 87]]
Sec. 33.40 Stays ordered by the Department of Justice.
If at any time the Attorney General or an Assistant Attorney General
designated by the Attorney General transmits to the Department head a
written finding that continuation of the administrative process
described in this part with respect to a claim or statement may
adversely affect any pending or potential criminal or civil action
related to such claim or statement, the Department head stays the
process immediately. The Department head orders the process resumed only
upon receipt of the written authorization of the Attorney General.
(Authority: 31 U.S.C. 3803(b)(3))
Sec. 33.41 Stay pending appeal.
(a) An initial decision is stayed automatically pending disposition
of a motion for reconsideration or of an appeal to the Department head.
(b) No administrative stay is available following a final decision
of the Department head.
(Authority: 31 U.S.C. 3809)
Sec. 33.42 Judicial review.
Section 3805 of title 31, United States Code, authorizes judicial
review by an appropriate United States District Court of a final
decision of the Department head imposing penalties or assessments under
this part and specifies the procedures for the review.
(Authority: 31 U.S.C. 3805)
Sec. 33.43 Collection of civil penalties and assessments.
Section 3806 and 3808(b) of title 31, United States Code, authorize
actions for collection of civil penalties and assessments imposed under
this part and specify the procedures for those actions.
(Authority: 31 U.S.C. 3808(b))
Sec. 33.44 Right to administrative offset.
The amount of any penalty or assessment that has become final, or
for which a judgment has been entered under Sec. 33.42 or Sec. 33.43,
or any amount agreed upon in a compromise or settlement under Sec.
33.46, may be collected by administrative offset under 31 U.S.C. 3716,
except that an administrative offset may not be under this section
against a refund of an overpayment of Federal taxes, then or later owing
by the United States to the defendant.
(Authority: 31 U.S.C. 3806)
Sec. 33.45 Deposit in Treasury of United States.
All amounts collected pursuant to this part are deposited as
miscellaneous receipts in the Treasury of the United States, except as
provided in 31 U.S.C. 3806(g).
(Authority: 31 U.S.C. 3807(b))
Sec. 33.46 Compromise or settlement.
(a) Parties may make offers of compromise or settlement at any time.
(Authority: 31 U.S.C. 3809)
(b) The reviewing official has the exclusive authority to compromise
or settle a case under this part at any time after the date on which the
reviewing official is permitted to issue a complaint and before the date
on which the ALJ issues an initial decision.
(Authority: 31 U.S.C. 3803(j))
(c) The Department head has exclusive authority to compromise or
settle a case under this part at any time after the date on which the
ALJ issues an initial decision, except during the pendency of any review
under Sec. 33.42 or during the pendency of any action to collect
penalties and assessments under Sec. 33.43.
(Authority: 31 U.S.C. 3803(i)(2)(C))
(d) The Attorney General has exclusive authority to compromise or
settle a case under this part during the pendency of any review under
Sec. 33.42 or of any action to recover penalties and assessments under
31 U.S.C. 3806.
(Authority: 31 U.S.C. 3806(f))
(e) The investigating official may recommend settlement terms to the
reviewing official, the Department head, or the Attorney General, as
appropriate. The reviewing official may recommend settlement terms to
the Department head, or the Attorney General, as appropriate.
(Authority: 31 U.S.C. 3809)
[[Page 88]]
(f) Any compromise or settlement must be in writing.
(Authority: 31 U.S.C. 3809)
Sec. 33.47 Limitations.
(a) The notice of hearing with respect to a claim or statement must
be served in the manner specified in Sec. 33.8 within six years after
the date on which the claim or statement is made.
(b) If the defendant fails to file a timely answer, service of a
notice under Sec. 33.10(b) is deemed a notice of hearing for purposes
of this section.
(c) The statute of limitations may be extended by agreement of the
parties.
(Authority: 31 U.S.C. 3808)
PART 34_ADMINISTRATIVE WAGE GARNISHMENT--Table of Contents
Sec.
34.1 Purpose of this part.
34.2 Scope of this part.
34.3 Definitions.
34.4 Notice of proposed garnishment.
34.5 Contents of a notice of proposed garnishment.
34.6 Rights in connection with garnishment.
34.7 Consideration of objection to the rate or amount of withholding.
34.8 Providing a hearing.
34.9 Conditions for an oral hearing.
34.10 Conditions for a paper hearing.
34.11 Timely request for a hearing.
34.12 Request for reconsideration.
34.13 Conduct of a hearing.
34.14 Burden of proof.
34.15 Consequences of failure to appear for an oral hearing.
34.16 Issuance of the hearing decision.
34.17 Content of decision.
34.18 Issuance of the wage garnishment order.
34.19 Amounts to be withheld under a garnishment order.
34.20 Amount to be withheld under multiple garnishment orders.
34.21 Employer certification.
34.22 Employer responsibilities.
34.23 Exclusions from garnishment.
34.24 Claim of financial hardship by debtor subject to garnishment.
34.25 Determination of financial hardship.
34.26 Ending garnishment.
34.27 Actions by employer prohibited by law.
34.28 Refunds of amounts collected in error.
34.29 Enforcement action against employer for noncompliance with
garnishment order.
34.30 Application of payments and accrual of interest.
Authority: 31 U.S.C. 3720D, unless otherwise noted.
Source: 68 FR 8142, Feb, 19, 2003, unless otherwise noted.
Sec. 34.1 Purpose of this part.
This part establishes procedures the Department of Education uses to
collect money from a debtor's disposable pay by means of administrative
wage garnishment to satisfy delinquent debt owed to the United States.
(Authority: 31 U.S.C. 3720D)
Sec. 34.2 Scope of this part.
(a) This part applies to collection of any financial obligation owed
to the United States that arises under a program we administer.
(b) This part applies notwithstanding any provision of State law.
(c) We may compromise or suspend collection by garnishment of a debt
in accordance with applicable law.
(d) We may use other debt collection remedies separately or in
conjunction with administrative wage garnishment to collect a debt.
(e) To collect by offset from the salary of a Federal employee, we
use the procedures in 34 CFR part 31, not those in this part.
(Authority: 31 U.S.C. 3720D)
Sec. 34.3 Definitions.
As used in this part, the following definitions apply:
Administrative debt means a debt that does not arise from an
individual's obligation to repay a loan or an overpayment of a grant
received under a student financial assistance program authorized under
Title IV of the Higher Education Act.
Business day means a day Monday through Friday, unless that day is a
Federal holiday.
Certificate of service means a certificate signed by an authorized
official of the U.S. Department of Education (the Department) that
indicates the nature of the document to which it pertains, the date we
mail the document, and to whom we are sending the document.
Day means calendar day. For purposes of computation, the last day of
a period will be included unless that day is a Saturday, a Sunday, or a
Federal
[[Page 89]]
legal holiday; in that case, the last day of the period is the next
business day after the end of the period.
Debt or claim means any amount of money, funds, or property that an
appropriate official of the Department has determined an individual owes
to the United States under a program we administer.
Debtor means an individual who owes a delinquent nontax debt to the
United States under a program we administer.
Disposable pay. This term--
(a)(1) Means that part of a debtor's compensation for personal
services, whether or not denominated as wages, from an employer that
remains after the deduction of health insurance premiums and any amounts
required by law to be withheld.
(2) For purposes of this part, ``amounts required by law to be
withheld'' include amounts for deductions such as social security taxes
and withholding taxes, but do not include any amount withheld under a
court order; and
(b) Includes, but is not limited to, salary, bonuses, commissions,
or vacation pay.
Employer. This term--
(a) Means a person or entity that employs the services of another
and that pays the latter's wages or salary;
(b) Includes, but is not limited to, State and local governments;
and
(c) Does not include an agency of the Federal Government.
Financial hardship means an inability to meet basic living expenses
for goods and services necessary for the survival of the debtor and his
or her spouse and dependents.
Garnishment means the process of withholding amounts from an
employee's disposable pay and paying those amounts to a creditor in
satisfaction of a withholding order.
We means the United States Department of Education.
Withholding order. (a) This term means any order for withholding or
garnishment of pay issued by this Department, another Federal agency, a
State or private non-profit guaranty agency, or a judicial or
administrative body.
(b) For purposes of this part, the terms ``wage garnishment order''
and ``garnishment order'' have the same meaning as ``withholding
order.''
You means the debtor.
(Authority: 31 U.S.C. 3720D)
Sec. 34.4 Notice of proposed garnishment.
(a) We may start proceedings to garnish your wages whenever we
determine that you are delinquent in paying a debt owed to the United
States under a program we administer.
(b) We start garnishment proceedings by sending you a written notice
of the proposed garnishment.
(c) At least 30 days before we start garnishment proceedings, we
mail the notice by first class mail to your last known address.
(d)(1) We keep a copy of a certificate of service indicating the
date of mailing of the notice.
(2) We may retain this certificate of service in electronic form.
(Authority: 31 U.S.C. 3720D)
Sec. 34.5 Contents of a notice of proposed garnishment.
In a notice of proposed garnishment, we inform you of--
(a) The nature and amount of the debt;
(b) Our intention to collect the debt through deductions from pay
until the debt and all accumulated interest, penalties, and collection
costs are paid in full; and
(c) An explanation of your rights, including those in Sec. 34.6,
and the time frame within which you may exercise your rights.
(Authority: 31 U.S.C. 3720D)
Sec. 34.6 Rights in connection with garnishment.
Before starting garnishment, we provide you the opportunity--
(a) To inspect and copy our records related to the debt;
(b) To enter into a written repayment agreement with us to repay the
debt under terms we consider acceptable;
(c) For a hearing in accordance with Sec. 34.8 concerning--
(1) The existence, amount, or current enforceability of the debt;
[[Page 90]]
(2) The rate at which the garnishment order will require your
employer to withhold pay; and
(3) Whether you have been continuously employed less than 12 months
after you were involuntarily separated from employment.
(Authority: 31 U.S.C. 3720D)
Sec. 34.7 Consideration of objection to the rate or amount of withholding.
(a) We consider objections to the rate or amount of withholding only
if the objection rests on a claim that withholding at the proposed rate
or amount would cause financial hardship to you and your dependents.
(b) We do not provide a hearing on an objection to the rate or
amount of withholding if the rate or amount we propose to be withheld
does not exceed the rate or amount agreed to under a repayment agreement
reached within the preceding six months after a previous notice of
proposed garnishment.
(c) We do not consider an objection to the rate or amount of
withholding based on a claim that by virtue of 15 U.S.C. 1673, no amount
of wages are available for withholding by the employer.
(Authority: 31 U.S.C. 3720D)
Sec. 34.8 Providing a hearing.
(a) We provide a hearing if you submit a written request for a
hearing concerning the existence, amount, or enforceability of the debt
or the rate of wage withholding.
(b) At our option the hearing may be an oral hearing under Sec.
34.9 or a paper hearing under Sec. 34.10.
(Authority: 31 U.S.C. 3720D)
Sec. 34.9 Conditions for an oral hearing.
(a) We provide an oral hearing if you--
(1) Request an oral hearing; and
(2) Show in the request a good reason to believe that we cannot
resolve the issues in dispute by review of the documentary evidence, by
demonstrating that the validity of the claim turns on the credibility or
veracity of witness testimony.
(b) If we determine that an oral hearing is appropriate, we notify
you how to receive the oral hearing.
(c)(1) At your option, an oral hearing may be conducted either in-
person or by telephone conference.
(2) We provide an in-person oral hearing with regard to
administrative debts only in Washington D.C.
(3) We provide an in-person oral hearing with regard to debts based
on student loan or grant obligations only at our regional service
centers in Atlanta, Chicago, or San Francisco.
(4) You must bear all travel expenses you incur in connection with
an in-person hearing.
(5) We bear the cost of any telephone calls we place in order to
conduct an oral hearing by telephone.
(d)(1) To arrange the time and location of the oral hearing, we
ordinarily attempt to contact you first by telephone call to the number
you provided to us.
(2) If we are unable to contact you by telephone, we leave a message
directing you to contact us within 5 business days to arrange the time
and place of the hearing.
(3) If we can neither contact you directly nor leave a message with
you by telephone--
(i) We notify you in writing to contact us to arrange the time and
place of the hearing; or
(ii) We select a time and place for the hearing, and notify you in
writing of the time and place set for the hearing.
(e) We consider you to have withdrawn the request for an oral
hearing if--
(1) Within 15 days of the date of a written notice to contact us, we
receive no response to that notice; or
(2) Within five business days of the date of a telephone message to
contact us, we receive no response to that message.
(Authority: 31 U.S.C. 3720D)
Sec. 34.10 Conditions for a paper hearing.
We provide a paper hearing--
(a) If you request a paper hearing;
(b) If you requested an oral hearing, but we determine under Sec.
34.9(e) that you have withdrawn that request;
(c) If you fail to appear for a scheduled oral hearing, as provided
in Sec. 34.15; or
(d) If we deny a request for an oral hearing because we conclude
that, by a
[[Page 91]]
review of the written record, we can resolve the issues raised by your
objections.
(Authority: 31 U.S.C. 3720D)
Sec. 34.11 Timely request for a hearing.
(a) A hearing request is timely if--
(1) You mail the request to the office designated in the garnishment
notice and the request is postmarked not later than the 30th day
following the date of the notice; or
(2) The designated office receives the request not later than the
30th day following the date of the garnishment notice.
(b) If we receive a timely written request from you for a hearing,
we will not issue a garnishment order before we--
(1) Provide the requested hearing; and
(2) Issue a written decision on the objections you raised.
(c) If your written request for a hearing is not timely--
(1) We provide you a hearing; and
(2) We do not delay issuance of a garnishment order unless--
(i) We determine from credible representations in the request that
the delay in filing the request for hearing was caused by factors over
which you had no control; or
(ii) We have other good reason to delay issuing a garnishment order.
(d) If we do not complete a hearing within 60 days of an untimely
request, we suspend any garnishment order until we have issued a
decision.
(Authority: 31 U.S.C. 3720D)
Sec. 34.12 Request for reconsideration.
(a) If you have received a decision on an objection to garnishment
you may file a request for reconsideration of that decision.
(b) We do not suspend garnishment merely because you have filed a
request for reconsideration.
(c) We consider your request for reconsideration if we determine
that--
(1) You base your request on grounds of financial hardship, and your
financial circumstances, as shown by evidence submitted with the
request, have materially changed since we issued the decision so that we
should reduce the amount to be garnished under the order; or
(2)(i) You submitted with the request evidence that you did not
previously submit; and
(ii) This evidence demonstrates that we should reconsider your
objection to the existence, amount, or enforceability of the debt.
(d)(1) If we agree to reconsider the decision, we notify you.
(2)(i) We may reconsider based on the request and supporting
evidence you have presented with the request; or
(ii) We may offer you an opportunity for a hearing to present
evidence.
(Authority: 31 U.S.C. 3720D)
Sec. 34.13 Conduct of a hearing.
(a)(1) A hearing official conducts any hearing under this part.
(2) The hearing official may be any qualified employee of the
Department whom the Department designates to conduct the hearing.
(b)(1) The hearing official conducts any hearing as an informal
proceeding.
(2) A witness in an oral hearing must testify under oath or
affirmation.
(3) The hearing official maintains a summary record of any hearing.
(c) Before the hearing official considers evidence we obtain that
was not included in the debt records available for inspection when we
sent notice of proposed garnishment, we notify you that additional
evidence has become available, may be considered by the hearing
official, and is available for inspection or copying.
(d) The hearing official considers any objection you raise and
evidence you submit--
(1) In or with the request for a hearing;
(2) During an oral hearing;
(3) By the date that we consider, under Sec. 34.9(e), that a
request for an oral hearing has been withdrawn; or
(4) Within a period we set, ordinarily not to exceed seven business
days, after--
(i) We provide you access to our records regarding the debt, if you
requested access to records within 20 days after the date of the notice
under Sec. 34.4;
[[Page 92]]
(ii) We notify you that we have obtained and intend to consider
additional evidence;
(iii) You request an extension of time in order to submit specific
relevant evidence that you identify to us in the request; or
(iv) We notify you that we deny your request for an oral hearing.
(Authority: 31 U.S.C. 3720D)
Sec. 34.14 Burden of proof.
(a)(1) We have the burden of proving the existence and amount of a
debt.
(2) We meet this burden by including in the record and making
available to the debtor on request records that show that--
(i) The debt exists in the amount stated in the garnishment notice;
and
(ii) The debt is currently delinquent.
(b) If you dispute the existence or amount of the debt, you must
prove by a preponderance of the credible evidence that--
(1) No debt exists;
(2) The amount we claim to be owed on the debt is incorrect, or
(3) You are not delinquent with respect to the debt.
(c)(1) If you object that the proposed garnishment rate would cause
financial hardship, you bear the burden of proving by a preponderance of
the credible evidence that withholding the amount of wages proposed in
the notice would leave you unable to meet the basic living expenses of
you and your dependents.
(2) The standards for proving financial hardship are those in Sec.
34.24.
(d)(1) If you object on the ground that applicable law bars us from
collecting the debt by garnishment at this time, you bear the burden of
proving the facts that would establish that claim.
(2) Examples of applicable law that may prevent collection by
garnishment include the automatic stay in bankruptcy (11 U.S.C. 362(a)),
and the preclusion of garnishment action against a debtor who was
involuntarily separated from employment and has been reemployed for less
than a continuous period of 12 months (31 U.S.C. 3720D(b)(6)).
(e) The fact that applicable law may limit the amount that an
employer may withhold from your pay to less than the amount or rate we
state in the garnishment order does not bar us from issuing the order.
(Authority: 31 U.S.C. 3720D)
Sec. 34.15 Consequences of failure to appear for an oral hearing.
(a) If you do not appear for an in-person hearing you requested, or
you do not answer a telephone call convening a telephone hearing, at the
time set for the hearing, we consider you to have withdrawn your request
for an oral hearing.
(b) If you do not appear for an oral hearing but you demonstrate
that there was good cause for not appearing, we may reschedule the oral
hearing.
(c) If you do not appear for an oral hearing you requested and we do
not reschedule the hearing, we provide a paper hearing to review your
objections, based on the evidence in your file and any evidence you have
already provided.
(Authority: 31 U.S.C. 3720D)
Sec. 34.16 Issuance of the hearing decision.
(a) Date of decision. The hearing official issues a written opinion
stating his or her decision, as soon as practicable, but not later than
60 days after the date on which we received the request for hearing.
(b) If we do not provide you with a hearing and render a decision
within 60 days after we receive your request for a hearing--
(1) We do not issue a garnishment order until the hearing is held
and a decision rendered; or
(2) If we have already issued a garnishment order to your employer,
we suspend the garnishment order beginning on the 61st day after we
receive the hearing request until we provide a hearing and issue a
decision.
(Authority: 31 U.S.C. 3720D)
Sec. 34.17 Content of decision.
(a) The written decision is based on the evidence contained in the
hearing record. The decision includes--
(1) A description of the evidence considered by the hearing
official;
[[Page 93]]
(2) The hearing official's findings, analysis, and conclusions
regarding objections raised to the existence or amount of the debt;
(3) The rate of wage withholding under the order, if you objected
that withholding the amount proposed in the garnishment notice would
cause an extreme financial hardship; and
(4) An explanation of your rights under this part for
reconsideration of the decision.
(b) The hearing official's decision is the final action of the
Secretary for the purposes of judicial review under the Administrative
Procedure Act (5 U.S.C. 701 et seq.).
(Authority: 31 U.S.C. 3720D)
Sec. 34.18 Issuance of the wage garnishment order.
(a)(1) If you fail to make a timely request for a hearing, we issue
a garnishment order to your employer within 30 days after the deadline
for timely requesting a hearing.
(2) If you make a timely request for a hearing, we issue a
withholding order within 30 days after the hearing official issues a
decision to proceed with garnishment.
(b)(1) The garnishment order we issue to your employer is signed by
an official of the Department designated by the Secretary.
(2) The designated official's signature may be a computer-generated
facsimile.
(c)(1) The garnishment order contains only the information we
consider necessary for your employer to comply with the order and for us
to ensure proper credit for payments received from your employer.
(2) The order includes your name, address, and social security
number, as well as instructions for withholding and information as to
where your employer must send the payments.
(d)(1) We keep a copy of a certificate of service indicating the
date of mailing of the order.
(2) We may create and maintain the certificate of service as an
electronic record.
(Authority: 31 U.S.C. 3720D)
Sec. 34.19 Amounts to be withheld under a garnishment order.
(a)(1) After an employer receives a garnishment order we issue, the
employer must deduct from all disposable pay of the debtor during each
pay period the amount directed in the garnishment order unless this
section or Sec. 34.20 requires a smaller amount to be withheld.
(2) The amount specified in the garnishment order does not apply if
other law, including this section, requires the employer to withhold a
smaller amount.
(b) The employer must comply with our garnishment order by
withholding the lesser of--
(1) The amount directed in the garnishment order; or--
(2) The amount specified in 15 U.S.C. 1673(a)(2) (Restriction on
Garnishment); that is, the amount by which a debtor's disposable pay
exceeds an amount equal to 30 times the minimum wage. (See 29 CFR
870.10.)
(Authority: 31 U.S.C. 3720D)
Sec. 34.20 Amount to be withheld under multiple garnishment orders.
If a debtor's pay is subject to several garnishment orders, the
employer must comply with our garnishment order as follows:
(a) Unless other Federal law requires a different priority, the
employer must pay us the amount calculated under Sec. 34.19(b) before
the employer complies with any later garnishment orders, except a family
support withholding order.
(b) If an employer is withholding from a debtor's pay based on a
garnishment order served on the employer before our order, or if a
withholding order for family support is served on an employer at any
time, the employer must comply with our garnishment order by withholding
an amount that is the smaller of--
(1) The amount calculated under Sec. 34.19(b); or
(2) An amount equal to 25 percent of the debtor's disposable pay
less the amount or amounts withheld under the garnishment order or
orders with priority over our order.
[[Page 94]]
(c)(1) If a debtor owes more than one debt arising from a program we
administer, we may issue multiple garnishment orders.
(2) The total amount withheld from the debtor's pay for orders we
issue under paragraph (c)(1) of this section does not exceed the amounts
specified in the orders, the amount specified in Sec. 34.19(b)(2), or
15 percent of the debtor's disposable pay, whichever is smallest.
(d) An employer may withhold and pay an amount greater than that
amount in paragraphs (b) and (c) of this section if the debtor gives the
employer written consent.
(Authority: 31 U.S.C. 3720D)
Sec. 34.21 Employer certification.
(a) Along with a garnishment order, we send to an employer a
certification in a form prescribed by the Secretary of the Treasury.
(b) The employer must complete and return the certification to us
within the time stated in the instructions for the form.
(c) The employer must include in the certification information about
the debtor's employment status, payment frequency, and disposable pay
available for withholding.
(Authority: 31 U.S.C. 3720D)
Sec. 34.22 Employer responsibilities.
(a)(1) Our garnishment order indicates a reasonable period of time
within which an employer must start withholding under the order.
(2) The employer must promptly pay to the Department all amounts the
employer withholds according to the order.
(b) The employer may follow its normal pay and disbursement cycles
in complying with the garnishment order.
(c) The employer must withhold the appropriate amount from the
debtor's wages for each pay period until the employer receives our
notification to discontinue wage garnishment.
(d) The employer must disregard any assignment or allotment by an
employee that would interfere with or prohibit the employer from
complying with our garnishment order, unless that assignment or
allotment was made for a family support judgment or order.
(Authority: 31 U.S.C. 3720D)
Sec. 34.23 Exclusions from garnishment.
(a) We do not garnish your wages if we have credible evidence that
you--
(1) Were involuntarily separated from employment; and
(2) Have not yet been reemployed continuously for at least 12
months.
(b) You have the burden of informing us of the circumstances
surrounding an involuntary separation from employment.
(Authority: 31 U.S.C. 3720D)
Sec. 34.24 Claim of financial hardship by debtor subject to garnishment.
(a) You may object to a proposed garnishment on the ground that
withholding the amount or at the rate stated in the notice of
garnishment would cause financial hardship to you and your dependents.
(See Sec. 34.7)
(b) You may, at any time, object that the amount or the rate of
withholding which our order specifies your employer must withhold causes
financial hardship.
(c)(1) We consider an objection to an outstanding garnishment order
and provide you an opportunity for a hearing on your objection only
after the order has been outstanding for at least six months.
(2) We may provide a hearing in extraordinary circumstances earlier
than six months if you show in your request for review that your
financial circumstances have substantially changed after the notice of
proposed garnishment because of an event such as injury, divorce, or
catastrophic illness.
(d)(1) You bear the burden of proving a claim of financial hardship
by a preponderance of the credible evidence.
(2) You must prove by credible documentation--
(i) The amount of the costs incurred by you, your spouse, and any
dependents, for basic living expenses; and
(ii) The income available from any source to meet those expenses.
(e)(1) We consider your claim of financial hardship by comparing--
[[Page 95]]
(i) The amounts that you prove are being incurred for basic living
expenses; against
(ii) The amounts spent for basic living expenses by families of the
same size and similar income to yours.
(2) We regard the standards published by the Internal Revenue
Service under 26 U.S.C. 7122(c)(2) (the ``National Standards'') as
establishing the average amounts spent for basic living expenses for
families of the same size as, and with family incomes comparable to,
your family.
(3) We accept as reasonable the amount that you prove you incur for
a type of basic living expense to the extent that the amount does not
exceed the amount spent for that expense by families of the same size
and similar income according to the National Standards.
(4) If you claim for any basic living expense an amount that exceeds
the amount in the National Standards, you must prove that the amount you
claim is reasonable and necessary.
(Authority: 31 U.S.C. 3720D)
Sec. 34.25 Determination of financial hardship.
(a)(1) If we conclude that garnishment at the amount or rate
proposed in a notice would cause you financial hardship, we reduce the
amount of the proposed garnishment to an amount that we determine will
allow you to meet proven basic living expenses.
(2) If a garnishment order is already in effect, we notify your
employer of any change in the amount the employer must withhold or the
rate of withholding under the order.
(b) If we determine that financial hardship would result from
garnishment based on a finding by a hearing official or under a
repayment agreement we reached with you, this determination is effective
for a period not longer than six months after the date of the finding or
agreement.
(c)(1) After the effective period referred to in paragraph (b) of
this section, we may require you to submit current information regarding
your family income and living expenses.
(2) If we conclude from a review of that evidence that we should
increase the rate of withholding or payment, we--
(i) Notify you; and
(ii) Provide you with an opportunity to contest the determination
and obtain a hearing on the objection under the procedures in Sec.
34.24.
(Authority: 31 U.S.C. 3720D)
Sec. 34.26 Ending garnishment.
(a)(1) A garnishment order we issue is effective until we rescind
the order.
(2) If an employer is unable to honor a garnishment order because
the amount available for garnishment is insufficient to pay any portion
of the amount stated in the order, the employer must--
(i) Notify us; and
(ii) Comply with the order when sufficient disposable pay is
available.
(b) After we have fully recovered the amounts owed by the debtor,
including interest, penalties, and collection costs, we send the
debtor's employer notification to stop wage withholding.
(Authority: 31 U.S.C. 3720D)
Sec. 34.27 Actions by employer prohibited by law.
An employer may not discharge, refuse to employ, or take
disciplinary action against a debtor due to the issuance of a
garnishment order under this part.
(Authority: 31 U.S.C. 3720D)
Sec. 34.28 Refunds of amounts collected in error.
(a) If a hearing official determines under Sec. Sec. 34.16 and
34.17 that a person does not owe the debt described in our notice or
that an administrative wage garnishment under this part was barred by
law at the time of the collection action, we promptly refund any amount
collected by means of this garnishment.
(b) Unless required by Federal law or contract, we do not pay
interest on a refund.
(Authority: 31 U.S.C. 3720D)
Sec. 34.29 Enforcement action against employer for noncompliance
with garnishment order.
(a) If an employer fails to comply with Sec. 34.22 to withhold an
appropriate
[[Page 96]]
amount from wages owed and payable to an employee, we may sue the
employer for that amount.
(b)(1) We do not file suit under paragraph (a) of this section
before we terminate action to enforce the debt as a personal liability
of the debtor.
(2) However, the provision of paragraph (b)(1) of this section may
not apply if earlier filing of a suit is necessary to avoid expiration
of any applicable statute of limitations.
(c)(1) For purposes of this section, termination of an action to
enforce a debt occurs when we terminate collection action in accordance
with the FCCS, other applicable standards, or paragraph (c)(2) of this
section.
(2) We regard termination of the collection action to have occurred
if we have not received for one year any payments to satisfy the debt,
in whole or in part, from the particular debtor whose wages were subject
to garnishment.
(Authority: 31 U.S.C. 3720D)
Sec. 34.30 Application of payments and accrual of interest.
We apply payments received through a garnishment in the following
order--
(a) To costs incurred to collect the debt;
(b) To interest accrued on the debt at the rate established by--
(1) The terms of the obligation under which it arises; or
(2) Applicable law; and
(c) To outstanding principal of the debt.
(Authority: 31 U.S.C. 3720D)