[Federal Register Volume 68, Number 237 (Wednesday, December 10, 2003)]
[Rules and Regulations]
[Pages 68750-68760]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-30408]


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GENERAL SERVICES ADMINISTRATION

41 CFR Part 105-56

[GSPMR Amendment 2003-02; GSPMR Case 2003-105-3]
RIN 3090-AH86


Salary Offset for Indebtedness of Federal Employees to the United 
States

AGENCY: Office of Finance, General Services Administration (GSA).

ACTION: Final rule.

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SUMMARY: The General Services Administration (GSA) is amending its 
regulations to implement the salary offset procedures used to collect 
debts that are owed to the United States by Federal employees. The 
change conforms GSA regulations to the legislative changes enacted in 
the Debt

[[Page 68751]]

Collection Improvement Act of 1996 and the amended procedures presented 
in the Federal Claims Collection Standards jointly issued by the 
Department of the Treasury (Treasury) and the Department of Justice 
(DoJ). The change allows GSA to improve its collection of debts due the 
United States from Federal employees.

DATES: Effective date: December 10, 2003.

FOR FURTHER INFORMATION CONTACT: The Regulatory Secretariat, Room 4035, 
GS Building, Washington, DC 20405, at (202) 501-4755 for information 
pertaining to status or publication schedules. For clarification of 
content, contact Mr. Michael J. Kosar, (202) 501-2029. Please cite 
GSPMR Amendment 2003-02, GSPMR case 2003-105-3.

SUPPLEMENTARY INFORMATION:

A. Background

    GSA currently has rules for collecting unpaid debts through salary 
offset under the provisions of the Debt Collection Act of 1982, the 
Federal Claims Collection Standards (FCCS) of 1966, and other 
authorities governing the collection of Federal debts. The change 
incorporates changes that are presented in the amended FCCS issued 
jointly by Treasury and DoJ, and the Debt Collection Improvement Act of 
1996 (DCIA).
    A new subpart B, Centralized Salary Offset Procedures (CSO)--GSA as 
Creditor Agency, is added to include procedures for notifying Treasury 
of delinquent Federal employee debtors from another agency who owe 
debts to GSA. A new subpart C, Centralized Salary Offset Procedures 
(CSO)--GSA as Paying Agency, is added to include procedures for 
offsetting debts of a GSA employee or a cross-serviced agency employee 
that owes a debt to another agency. The DCIA of 1996 requires Federal 
agencies to match their delinquent debtor records with records of 
Federal employees, at least annually, to identify Federal employees who 
owe delinquent debt to the United States. This part implements the 
requirement under 5 U.S.C. 5514(a)(1) that all Federal agencies, using 
a process known as centralized salary offset computer matching, 
identify Federal employees who owe delinquent non-tax debt to the 
United States. Centralized salary offset computer matching is the 
computerized comparison of delinquent debt records with records of 
Federal employees. The purpose of centralized salary offset computer 
matching is to identify those debtors whose Federal salaries should be 
offset to collect delinquent debts owed to the Federal Government. This 
part specifies the delinquent debt records and Federal employee records 
that must be included in the salary offset matching process. For 
purposes of this part, delinquent debt records consist of the debt 
information submitted to Treasury for purposes of administrative offset 
as required under 31 U.S.C. 3716(c)(6).

Discussion of Comments

    In response to its Notice of Proposed Rule (NPR) concerning Salary 
Offset for Indebtedness of Federal Employees to the United States (68 
FR 41093, July 10, 2003), GSA received internal comments from its 
National Payroll Center (NPC). A review of the comments is provided in 
the following comment analysis, including a discussion of GSA's 
determination whether to incorporate specific suggestions in the final 
rule. The comment analysis is organized by reference to the paragraph 
in the NPR.
    NPR Sec. 105-56.003, Definitions. The final rule incorporates one 
commenter's suggestion to list the definitions in alphabetical order.
    NPR Sec. 105-56.003(j) and NPR Sec. 105-56.015(m), Definitions. One 
commenter suggested inserting the word Administration after General 
Services so the definition reads ``Administrator of General Services 
Administration''. The commenter's suggestion and the NPR definitions 
have the same meaning, however, the NPR definition is considered the 
more grammatically correct. No change is made to the final rule.
    NPR Sec. 105-56.005(b), Employee response. One commenter suggested 
NPR Sec. 105-56.005(b) specify where an employee should submit their 
waiver request since the other lettered paragraphs specify a point of 
contact. They recommend that employees send their signed waiver request 
to the GSA National Payroll Center (NPC). This suggestion is 
incorporated in the final rule.

B. Executive Order 12866

    GSA has determined that this regulation is not a significant 
regulatory action as defined in Executive Order 12866, and accordingly, 
this regulation has not been reviewed by the Office of Management and 
Budget.

C. Regulatory Flexibility Act

    It is hereby certified that this regulation will not have a 
significant economic impact on a substantial number of small entities 
because the regulation either (1) results in greater flexibility for 
GSA to streamline debt collection regulations, or (2) reflects the 
statutory language contained in the DCIA. Accordingly, a Regulatory 
Flexibility Analysis is not required.

D. Executive Order 13132

    This regulation will not have a substantial direct effect on the 
States, on the relationship between the national government and the 
States, or on distribution of power and responsibilities among the 
various levels of government. Therefore, in accordance with Executive 
Order 13132, it is determined that this regulation does not have 
sufficient federalism implications to warrant the preparation of a 
federalism assessment.

E. Unfunded Mandates Reform Act of 1995

    This regulation will not result in the expenditure by State, local 
and tribal governments, in the aggregate, or by the private sector, of 
$100 million or more in any one (1) year, and it will not significantly 
or uniquely affect small governments. Therefore, no actions were deemed 
necessary under the provisions of the Unfunded Mandates Reform Act of 
1995.

F. Small Business Regulatory Enforcement Fairness Act of 1996

    This rule is not a major rule as defined by section 251 of the 
Small Business Regulatory Enforcement Act, 5 U.S.C. 804. This rule will 
not result in an annual effect on the economy of $100 million or more; 
a major increase in costs or prices; or significant adverse effects on 
competition, employment, investment, productivity, innovation, or on 
the ability of United States-based companies to compete with foreign-
based companies in domestic or export markets.

G. Paperwork Reduction Act

    This rule does not contain information collection requirements that 
require approval by the Office of Management and Budget under the 
Paperwork Reduction Act, 44 U.S.C. 3507 et seq.

List of Subjects in 41 CFR Part 105-56

    Claims, Salary offset, Payments, Administrative practice and 
procedure, Hearings, Appeals procedures, Debts, Debt collection, Wages, 
Government employees.

    Dated: December 2, 2003.
Stephen A. Perry,
Administrator of General Services.

0
For the reasons set forth in the preamble, GSA amends 41 CFR chapter 
105 as follows:

[[Page 68752]]

PART 105-56--SALARY OFFSET FOR INDEBTEDNESS OF FEDERAL EMPLOYEES TO 
THE UNITED STATES

0
1. Revise part 105-56 to read as follows:

PART 105-56--SALARY OFFSET FOR INDEBTEDNESS OF FEDERAL EMPLOYEES TO 
THE UNITED STATES

Subpart A--Salary Offset of General Services Administration Employees
Sec.
105-56.001 Scope.
105-56.002 Excluded debts or claims.
105-56.003 Definitions.
105-56.004 Pre-offset notice.
105-56.005 Employee response.
105-56.006 Petition for pre-offset hearing.
105-56.007 Pre-offset oral hearing.
105-56.008 Pre-offset paper hearing.
105-56.009 Written decision.
105-56.010 Deductions.
105-56.011 Non-waiver of rights.
105-56.012 Refunds.
105-56.013 Coordinating offset with another Federal agency.
Subpart B--Centralized Salary Offset (CSO) Procedures--GSA as Creditor 
Agency
105-56.014 Purpose and scope.
105-56.015 Definitions.
105-56.016 GSA participation.
105-56.017 Centralized salary offset computer match.
105-56.018 Salary offset.
105-56.019 Offset amount.
105-56.020 Priorities.
105-56.021 Notice.
105-56.022 Fees.
105-56.023 Disposition of amounts collected.
Subpart C--Centralized Salary Offset (CSO) Procedures--GSA as Paying 
Agency
105-56.024 Purpose and scope.
105-56.025 Definitions.
105-56.026 GSA participation.
105-56.027 Centralized salary offset computer match.
105-56.028 Salary offset.
105-56.029 Offset amount.
105-56.030 Priorities.
105-56.031 Notice.
105-56.032 Fees.
105-56.033 Disposition of amounts collected.

    Authority: 5 U.S.C. 5514; 31 U.S.C. 3711; 31 U.S.C. 3716; 5 CFR 
part 550, subpart K; 31 CFR part 5; 31 CFR 285.7; 31 CFR parts 900-
904.

Subpart A--Salary Offset of General Services Administration 
Employees


Sec.  105-56.001  Scope.

    (a) This subpart covers internal GSA collections under 5 U.S.C. 
5514. It applies when certain debts to the United States are recovered 
by administrative offset from the disposable pay of a GSA employee or a 
cross-serviced agency employee, except in situations where the employee 
consents to the recovery.
    (b) The collection of any amount under this subpart will be in 
accordance with the standards promulgated pursuant to the Debt 
Collection Improvement Act of 1996 (DCIA), 31 U.S.C. 3701 et seq., and 
the Federal Claims Collection Standards, 31 CFR parts 900 through 904 
as amended, or in accordance with any other statutory authority for the 
collection of claims of the United States or any Federal agency.


Sec.  105-56.002  Excluded debts or claims.

    This subpart does not apply to the following:
    (a) Debts or claims arising under the Internal Revenue Code of 1954 
as amended (26 U.S.C. 1 et seq.), the Social Security Act (42 U.S.C. 
301 et seq.), or the tariff laws of the United States.
    (b) Any case where collection of a debt by salary offset is 
explicitly provided for or prohibited by another statute. Debt 
collection procedures under other statutory authorities, however, must 
be consistent with the provisions of the Federal Claims Collection 
Standards, defined at paragraph (h) of Sec.  105-56.003.
    (c) An employee election of coverage or of a change of coverage 
under a Federal benefits program that requires periodic deductions from 
pay if the amount to be recovered was accumulated over four pay periods 
or less. However, if the amount to be recovered was accumulated over 
more than four pay periods, the procedures under Sec.  105-56.004 of 
this subpart will apply.
    (d) Routine adjustment in pay or allowances that is made to correct 
an overpayment of pay attributable to clerical or administrative errors 
or delays in processing pay documents, if the overpayment occurred 
within the four pay periods preceding the adjustment and, at the time 
of the adjustment, or as soon after as possible, the employee is 
provided written notice of the nature and amount of the adjustment.
    (e) Any adjustment to collect a debt amounting to $50 or less, if, 
at the time of the adjustment, or as soon after as possible, the 
employee is given written notice of the nature and amount of the 
adjustment and a point of contact for contesting the adjustment.
    (f) Debts or claims arising from the accrual of unpaid Health 
Benefits Insurance (HBI) premiums as the result of an employee's 
election to continue health insurance coverage during periods of leave 
without pay (LWOP), or when pay is insufficient to cover premiums. Debt 
collection procedures for unpaid HBI are covered under 5 CFR part 890, 
Subpart E.


Sec.  105-56.003  Definitions.

    The following definitions apply to this subpart:
    (a) Administrative offset, as defined in 31 U.S.C. 3701(a)(1), 
means withholding funds payable by the United States (including funds 
payable by the United States on behalf of a State government) to, or 
held by the United States for, a person to satisfy a claim.
    (b) Agency means a department, agency or sub-agency, court, court 
administrative office, or instrumentality in the executive, judicial, 
or legislative branch of the Federal government, including government 
corporations.
    (c) Business day means Monday through Friday, excluding Federal 
legal holidays. For purposes of computation, the last day of the period 
will be included unless it is a Federal legal holiday.
    (d) Creditor agency means any agency that is owed a debt, including 
a debt collection center when acting on behalf of a creditor agency in 
matters pertaining to the collection of a debt.
    (e) Cross-serviced agency means an arrangement between GSA and 
another agency whereby GSA provides financial support services to the 
other agency on a reimbursable basis. Financial support services can 
range from simply providing computer and software timesharing services 
to full-service administrative processing.
    (f) Disposable pay means the amount that remains from an employee's 
Federal pay after required deductions for Federal, State and local 
income taxes; Social Security taxes, including Medicare taxes; Federal 
retirement programs, including contributions to the Thrift Savings Plan 
(TSP); premiums for life (excluding amounts deducted for supplemental 
coverage) and health insurance benefits; Internal Revenue Service (IRS) 
tax levies; and such other deductions that may be required by law to be 
withheld.
    (g) Employee means any individual employed by GSA or a cross-
serviced agency of the executive, legislative, or judicial branches of 
the Federal Government, including Government corporations.
    (h) FCCS means the Federal Claims Collection Standards jointly 
published by the Department of Justice and the Department of the 
Treasury at 31 CFR parts 900 through 904.
    (i) 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.
    (j) For the purposes of the standards in this subpart, unless 
otherwise stated, the term ``Administrator'' refers to the

[[Page 68753]]

Administrator of General Services or the Administrator's delegate.
    (k) For the purposes of the standards in this subpart, the terms 
``claim'' and ``debt'' are synonymous and interchangeable. They refer 
to an amount of money, funds, or property that has been determined by 
GSA to be due the United States from an employee of GSA or a cross-
serviced agency from sources which include loans insured or guaranteed 
by the United States and all other amounts due the United States from 
fees, leases, rents, royalties, services, sales of real or personal 
property, overpayments, penalties, damages, interest, fines and 
forfeitures and all other similar sources, including debt administered 
by a third party as an agent for the Federal Government. For the 
purposes of administrative offset under 31 U.S.C. 3716, the terms 
``claim'' and ``debt'' include an amount of money, funds, or property 
owed by an employee to a State (including past-due support being 
enforced by a State), the District of Columbia, American Samoa, Guam, 
the United States Virgin Islands, the Commonwealth of the Northern 
Mariana Islands, or the Commonwealth of Puerto Rico.
    (l) For the purposes of the standards in this subpart, unless 
otherwise stated, the terms ``GSA'' and ``Agency'' are synonymous and 
interchangeable.
    (m) Hearing official means a Board Judge of the GSA Board of 
Contract Appeals (GSBCA).
    (n) 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.
    (o) Pre-offset hearing means a review of the documentary evidence 
concerning the existence and/or amount of a debt, and/or the terms of a 
repayment schedule, provided such repayment schedule is established 
other than by a written agreement entered into pursuant to this 
subpart. If the hearing official determines that the issues in dispute 
cannot be resolved solely by review of the written record, such as when 
the validity of the debt turns on the issue of credibility or veracity, 
an oral hearing may be provided.
    (p) Program official means a supervisor or management official of 
the employee's service, staff office, cross-serviced agency, or other 
designated Agency officials.
    (q) Reconsideration means a request by the employee to have a 
secondary review by GSA of the existence and/or amount of the debt, 
and/or the proposed offset schedule.
    (r) Salary offset means an administrative offset to collect a debt 
under 5 U.S.C. 5514 by deduction(s) at one or more officially 
established pay intervals from the current pay account of an employee 
without his or her consent.
    (s) Waiver means the cancellation, remission, forgiveness, or non-
recovery of a debt or debt-related charge as permitted or required by 
law.


Sec.  105-56.004  Pre-offset notice.

    An employee must be given written notice from the appropriate 
program official at least 30 days in advance of initiating a deduction 
from disposable pay informing him or her of--
    (a) The nature, origin and amount of the indebtedness determined by 
GSA or a cross-serviced agency to be due;
    (b) The intention of GSA to initiate proceedings to collect the 
debt through deductions from the employee's current disposable pay and 
other eligible payments;
    (c) The amount (stated as a fixed dollar amount or as a percentage 
of pay, not to exceed 15 percent of disposable pay), frequency, 
proposed beginning date, and duration of the intended deductions;
    (d) GSA's policy concerning how interest, penalties, and 
administrative costs are assessed (see 41 CFR part 105-55.017), 
including a statement that such assessments will be made unless excused 
under 31 U.S.C. 3717(h) and 31 CFR 901.9(g) and (h);
    (e) The employee's right to inspect and copy GSA records relating 
to the debt, if records of the debt are not attached to the notice, or 
if the employee or his or her representative cannot personally inspect 
the records, the right to receive a copy of such records. Any costs 
associated with copying the records for the debtor will be borne by the 
debtor. The debtor must give a minimum of three (3) business days 
notice in advance to GSA of the date on which he or she intends to 
inspect and copy the records involved;
    (f) A demand for repayment providing for an opportunity, under 
terms agreeable to GSA, for the employee to establish a schedule for 
the voluntary repayment of the debt by offset or to enter into a 
written repayment agreement of the debt in lieu of offset;
    (g) The employee's right to request a waiver (see Sec.  105-
56.005(b) of this subpart);
    (h) The employee's right to request reconsideration by the Agency 
of the existence and/or amount of the debt, and/or the proposed offset 
schedule;
    (i) The employee's right to a pre-offset hearing conducted by a 
hearing official, arranged by the appropriate program official, if a 
request is filed as prescribed by Sec.  105-56.006 of this subpart;
    (j) The method and time period for requesting a hearing, including 
a statement that the timely filing of a request for hearing will stay 
the commencement of collection proceedings;
    (k) The issuance of a final decision on the hearing, if requested, 
at the earliest practicable date, but no later than 60 days after the 
request for hearing is filed, unless the employee requests and the 
hearing official grants a delay in the proceedings;
    (l) The risk that any knowingly false or frivolous statements, 
representations, or evidence may subject the employee to--
    (1) Disciplinary procedures appropriate under 5 U.S.C. Chapter 75, 
5 CFR part 752, or any other applicable statutes or regulations;
    (2) Penalties under the False Claims Act, 31 U.S.C. 3729-3731, or 
any other applicable statutory authority; or
    (3) Criminal penalties under 18 U.S.C. 286, 287, 1001, and 1002, or 
any other applicable statutory authority;
    (m) Any other rights and remedies available to the employee under 
statutes or regulations governing the program for which the collection 
is being made;
    (n) The employee's right to a prompt refund if amounts paid or 
deducted are later waived or found not owed, unless otherwise provided 
by law (see Sec.  105-56.012 of this subpart);
    (o) The specific address to which all correspondence must be 
directed regarding the debt.


Sec.  105-56.005  Employee response.

    (a) Voluntary repayment agreement. An employee may submit a request 
to the appropriate program official who signed the pre-offset notice to 
enter into a written repayment agreement of the debt in lieu of offset. 
The request must be made within 7 days of receipt of notice under Sec.  
105-56.004 of this subpart. The agreement must be in writing, signed by 
both the employee and the appropriate program official making the 
notice, and a signed copy must be sent to the appropriate Finance 
Center serving the program activity. Acceptance of such an agreement is 
discretionary with the Agency. An employee who enters into such an 
agreement may, nevertheless, seek a waiver under paragraph (b) of this 
section.
    (b) Waiver. An employee may submit a signed waiver request of 
overpayment of pay or allowances (e.g., 5 U.S.C. 5584, 10 U.S.C. 2774, 
or 32 U.S.C. 716) to the GSA National Payroll Center (NPC). When an 
employee requests waiver

[[Page 68754]]

consideration, further collection on the debt may be suspended until a 
final administrative decision is made on the waiver request. During the 
period of any suspension, interest, penalties and administrative 
charges may be held in abeyance. GSA will not duplicate, for purposes 
of salary offset, any of the notices/procedures already provided the 
debtor prior to a request for waiver.
    (c) Reconsideration. (1) An employee may seek a reconsideration of 
GSA's determination regarding the existence and/or amount of the debt. 
The request must be submitted to the appropriate program official 
indicated in the pre-offset notice, within 7 days of receipt of notice 
under Sec.  105-56.004 of this subpart. Within 20 days of receipt of 
this notice, the employee must submit a detailed statement of reasons 
for reconsideration that must be accompanied by supporting 
documentation.
    (2) An employee may request a reconsideration of the proposed 
offset schedule. The request must be submitted to the appropriate 
program official indicated in the pre-offset notice, within 7 days of 
receipt of notice under Sec.  105-56.004 of this subpart. Within 20 
days of receipt of this notice, the employee must submit an alternative 
repayment schedule accompanied by a detailed statement, supported by 
documentation, evidencing financial hardship resulting from GSA's 
proposed schedule. Acceptance of the request is at GSA's discretion. 
GSA will notify the employee in writing of its decision concerning the 
request to reduce the rate of an involuntary deduction.


Sec.  105-56.006  Petition for pre-offset hearing.

    (a) The employee may request a pre-offset hearing by filing a 
written petition with the appropriate program official indicated in the 
pre-offset notice, within 15 days of receipt of the written notice. The 
petition must state why the employee believes GSA's determination 
concerning the existence and/or amount of the debt is in error, set 
forth any objections to the involuntary repayment schedule, and, if the 
employee is seeking an oral hearing, set forth reasons for an oral 
hearing. The timely filing of a petition will suspend the commencement 
of collection proceedings.
    (b) The employee's petition or statement must be signed and dated 
by the employee.
    (c) Petitions for hearing made after the expiration of the 15-day 
period may be accepted if the employee can show that the delay was 
because of circumstances beyond his or her control or because of 
failure to receive notice of the time limit.
    (d) If the employee timely requests a pre-offset hearing or the 
timeliness is waived, the appropriate program official must--
    (1) Promptly notify the GSBCA and arrange for a hearing official 
(see Sec.  105-56.003(m) of this subpart). The hearing official will 
notify the employee whether he or she may have an oral or a ``paper 
hearing,'' i.e., a review on the written record (see 31 CFR 901.3(e)); 
and
    (2) Provide the hearing official with a copy of all records on 
which the determination of the debt and any involuntary repayment 
schedule are based.
    (e) If an oral hearing is to be held, the hearing official will 
notify the appropriate program official and the employee of the date, 
time, and location of the hearing. The debtor may choose to have the 
hearing conducted in the hearing official's office located at GSA 
Central Office, 1800 F St., NW., Washington, DC 20405, at another 
location designated by the hearing official, or by telephone. The 
debtor and any witnesses are responsible for any personal expenses 
incurred to arrive at a hearing official's office or other designated 
location (see Sec.  105-56.007(c)). All telephonic charges incurred 
during a hearing will be the responsibility of GSA.
    (f) If the employee later elects to have the hearing based only on 
the written submissions, notification must be given to the hearing 
official and the appropriate program official at least 3 days before 
the date of the oral hearing. The hearing official may waive the 3-day 
requirement for good cause.
    (g) If either party, without good cause as determined by the 
hearing official, does not appear at a scheduled oral hearing, the 
hearing official will make a determination on the claim which takes 
into account that party's position as presented in writing only.


Sec.  105-56.007  Pre-offset oral hearing.

    (a) The Agency, represented by the appropriate program official or 
a representative of the Office of General Counsel, and the employee, 
and/or his or her representative, will explain their case in the form 
of an oral presentation with reference to the documentation submitted. 
The employee may testify on his or her own behalf, subject to cross-
examination. Other witnesses may be called to testify when the hearing 
official determines the testimony to be relevant and not redundant. All 
witnesses will testify under oath, with the oath having been 
administered by the hearing official. A written transcript of the 
hearing will be kept and made available to either party in the event of 
an appeal under the Administrative Procedure Act, 5 U.S.C. 701-706. 
Arrangements for the taking of the transcript will be made by the 
hearing official, and all charges associated with the taking of the 
transcript will be the responsibility of GSA.
    (b) The hearing official will--
    (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 of his or her choice at the hearing. GSA 
will not compensate the employee for representation expenses, including 
hourly fees for attorneys, travel expenses, and costs for reproducing 
documents.
    (d) Oral hearings are open to the public. However, the hearing 
official may close all or any portion of the hearing when doing so is 
in the best interests of the employee or the Agency.
    (e) Oral hearings may be conducted by telephone at the request of 
the employee. All telephonic charges incurred during a hearing will be 
the responsibility of GSA.
    (f) The hearing official may request written submissions and 
documentation from the employee and the Agency, in addition to 
considering evidence offered at the hearing.


Sec.  105-56.008  Pre-offset paper hearing.

    If a hearing is to be held only upon written submissions, the 
hearing official will issue a decision based upon the record and 
responses submitted by both the Agency and the employee. See Sec.  105-
56.006 of this subpart. If either party, without good cause as 
determined by the hearing official, does not provide written 
submissions and documentation requested by the hearing official, the 
hearing official will make a determination on the claim without 
reference to such submissions and documentation.


Sec.  105-56.009  Written decision.

    (a) Within 60 days of the employee's filing of a petition for a 
pre-offset hearing, the hearing official will issue a written decision 
setting forth--
    (1) The facts supporting the nature and origin of the debt;
    (2) The hearing official's analysis, findings and conclusions as to 
the employee's or Agency's grounds;
    (3) The amount and validity of the debt; and

[[Page 68755]]

    (4) The repayment schedule, if applicable.
    (b) The hearing official's decision will be the final Agency action 
for the purposes of judicial review under the Administrative Procedure 
Act (5 U.S.C. 701 et seq.).


Sec.  105-56.110  Deductions.

    (a) When deductions may begin. Deductions may begin upon the 
issuance of an Agency decision on a request for reconsideration or 
waiver (except as provided in Sec.  105-56.005(b) of this subpart) or 
the issuance of a decision in a pre-offset hearing. In no event will 
deductions begin sooner than thirty days from the date of the notice 
letter. If the employee filed a petition for hearing with the 
appropriate program official before the expiration of the period 
provided for in Sec.  105-56.006 of this subpart, then deductions will 
begin after the hearing official has provided the employee with a 
hearing and the final written decision. The appropriate program 
official will coordinate with the National Payroll Center to begin 
offset in accordance with the final written decision.
    (b) Retired or separated employees. If the employee retires, 
resigns, or is terminated before collection of the indebtedness is 
completed, the remaining indebtedness will be offset from any 
subsequent payments of any nature. If the debt cannot be satisfied from 
subsequent payments, then the debt will be collected according to the 
procedures for administrative offset pursuant to Sec.  105-55.011 of 
this subpart.
    (c) Types of collection. A debt may be collected in one lump sum or 
in installments. Collection will be by lump sum unless the employee is 
able to demonstrate to the program official who signed the notice 
letter that he or she is financially unable to pay in one lump sum. In 
these cases, collection will be by installment deductions. Involuntary 
deductions from pay may not exceed 15 percent of disposable pay.
    (d) Methods of collection. If the debt cannot be collected in one 
lump sum, the debt will be collected by deductions at officially 
established pay intervals from an employee's current pay account, 
unless the employee and the appropriate program official agree to an 
alternative repayment schedule. The alternative arrangement must be in 
writing and signed by both the employee and the appropriate program 
official.
    (1) Installment deductions. Installment deductions will be made 
over the shortest period possible. The size and frequency of 
installment deductions will bear a reasonable relation to the size of 
the debt and the employee's ability to pay. However, the amount 
deducted for any period will not exceed 15 percent of the disposable 
pay from which the deduction is made, unless the employee has agreed in 
writing to the deduction of a greater amount. The installment payment 
normally will be sufficient in size and frequency to liquidate the debt 
in three (3) years or less, unless circumstances warrant a longer 
period. Installment payments of less than $100 per pay period will be 
accepted only in the most unusual circumstances.
    (2) Sources of deductions. GSA will make salary deductions only 
from basic pay, special pay, incentive pay, retired pay, retainer pay, 
or in the case of an employee not entitled to basic pay, other 
authorized pay.
    (e) Non-Salary payments. The receipt of collections from salary 
offsets does not preclude GSA from pursuing other debt collection 
remedies, including the offset of other Federal payments to satisfy 
delinquent non-tax debt owed to the United States. GSA will pursue, 
when appropriate, such debt collection remedies separately or in 
conjunction with salary offset.
    (f) Interest, penalties and administrative costs. Interest, 
penalties and administrative costs on debts under this subpart will be 
assessed according to the provisions of Sec.  105-55.016 of this 
subpart.


Sec.  105-56.011  Non-waiver of rights.

    An employee's involuntary payment of all or any portion of a debt 
being collected under 5 U.S.C. 5514 will not be construed as a waiver 
of any rights which the employee may have under 5 U.S.C. 5514 or any 
other provision of contract or law unless there are statutory or 
contractual provisions to the contrary.


Sec.  105-56.012  Refunds.

    (a) GSA will promptly refund to the employee any amounts offset 
under these regulations when a debt is waived or otherwise found not 
owing the United States (unless expressly prohibited by statute or 
regulation), or GSA is directed by an administrative or judicial order 
to refund amounts deducted from the employee's current pay or withheld 
from non-salary payments.
    (b) Unless required by Federal law or contract, refunds under this 
subpart will not bear interest.


Sec.  105-56.013  Coordinating offset with another Federal agency.

    GSA participates in the Centralized Salary Offset (CSO) program 
(see subparts B and C of this part). In those instances when CSO cannot 
be utilized (i.e., when another agency does not participate in the 
program), the following procedures apply:
    (a) When GSA is the creditor agency. When GSA is owed a debt by an 
employee of another agency, GSA will provide the paying agency with a 
written certification that the debtor owes GSA a debt and that GSA has 
complied with these regulations. This certification will include the 
amount and basis of the debt, the due date of the payment, or the 
beginning date of installment payments, if any.
    (b) When another agency is the creditor agency. (1) GSA may use 
salary offset against one of its employees or cross-serviced agency 
employees who is indebted to another agency if requested to do so by 
that agency. Any such request must be accompanied by a certification 
from the requesting agency that the person owes the debt, the amount of 
the debt and that the employee has been given the procedural rights 
required by 5 U.S.C. 5514 and 5 CFR part 550, subpart K.
    (2) The creditor agency must advise GSA of the number of 
installments to be collected, the amount of each installment, and the 
beginning date of the first installment if it is not the next 
established pay period.
    (3) If GSA receives an improperly completed request, the creditor 
agency will be requested to supply the required information before any 
salary offset begins.
    (4) If the claim procedures in paragraph (b)(1) of this section 
have been properly completed, deductions will begin on the next 
established pay period unless a different period is requested by the 
creditor agency.
    (5) GSA will not review the merits of the creditor agency's 
determinations with respect to the amount and/or validity of the debt 
as stated in the debt claim certification.
    (6) If the employee begins separation action before GSA collects 
the total debt due the creditor agency, the following actions will be 
taken:
    (i) When possible, the balance owed the creditor agency will be 
liquidated from subsequent payments of any nature due the employee from 
GSA in accordance with 41 CFR part 105-55.011;
    (ii) If the total amount of the debt cannot be recovered, GSA will 
certify the total amount collected to the creditor agency and the 
employee;
    (iii) If GSA is aware that the employee is entitled to payments 
from the Civil Service Retirement and Disability Fund, or other similar 
payments, such

[[Page 68756]]

information will be provided to the creditor agency so a certified 
claim can be made against the payments.
    (7) If the employee transfers to another Federal agency before GSA 
collects the total amount due the creditor agency, GSA will certify the 
total amount collected to the creditor agency and the employee. It is 
the responsibility of the creditor agency to ensure that collection 
action is resumed by the new employing agency.

Subpart B--Centralized Salary Offset (CSO) Procedures--GSA as 
Creditor Agency


Sec.  105-56.014  Purpose and scope.

    (a) This subpart establishes procedures for the offset of Federal 
salary payments, through the Financial Management Service's (FMS) 
administrative offset program, to collect delinquent debts owed to the 
Federal Government. This process is known as centralized salary offset. 
Rules issued by the Office of Personnel Management contain the 
requirements Federal agencies must follow prior to conducting salary 
offset and the procedures for requesting offsets directly from a paying 
agency. See 5 CFR parts 550.1101 through 550.1108.
    (b) This subpart implements the requirement under 5 U.S.C. 5514 
(a)(1) that all Federal agencies, using a process known as centralized 
salary offset computer matching, identify Federal employees who owe 
delinquent non-tax debt to the United States. Centralized salary offset 
computer matching is the computerized comparison of delinquent debt 
records with records of Federal employees. The purpose of centralized 
salary offset computer matching is to identify those debtors whose 
Federal salaries should be offset to collect delinquent debts owed to 
the Federal Government.
    (c) This subpart specifies the delinquent debt records and Federal 
employee records that must be included in the salary offset matching 
process. For purposes of this subpart, delinquent debt records consist 
of the debt information submitted to FMS for purposes of administrative 
offset as required under 31 U.S.C. 3716(c)(6). Since GSA submits debts 
to FMS for purposes of administrative offset, the Agency is not 
required to submit duplicate information for purposes of centralized 
salary offset computer matching under 5 U.S.C. 5514(a)(1) and this 
subpart.
    (d) An interagency consortium was established to implement 
centralized salary offset computer matching on a Governmentwide basis 
as required under 5 U.S.C. 5514(a)(1). Federal employee records consist 
of records of Federal salary payments disbursed by members of the 
consortium.
    (e) The receipt of collections from salary offsets does not 
preclude GSA from pursuing other debt collection remedies, including 
the offset of other Federal payments to satisfy delinquent non-tax debt 
owed to the United States. GSA will pursue, when appropriate, such debt 
collection remedies separately or in conjunction with salary offset.


Sec.  105-56.015  Definitions.

    The following definitions apply to this subpart:
    (a) Administrative offset means withholding funds payable by the 
United States to, or held by the United States for, a person to satisfy 
a debt owed by the payee.
    (b) Agency means a department, agency or sub-agency, court, court 
administrative office, or instrumentality in the executive, judicial, 
or legislative branch of the Federal government, including government 
corporations.
    (c) Centralized salary offset computer matching means the 
computerized comparison of Federal employee records with delinquent 
debt records to identify Federal employees who owe such debts.
    (d) Consortium means an interagency group established by the 
Secretary of the Treasury to implement centralized salary offset 
computer matching. The group includes all agencies that disburse 
Federal salary payments.
    (e) Creditor agency means any agency that is owed a debt, including 
a debt collection center when acting on behalf of a creditor agency in 
matters pertaining to the collection of a debt.
    (f) Debt means any amount of money, funds, or property that has 
been determined by an appropriate official of the Federal government to 
be owed to the United States by a person, including debt administered 
by a third party acting as an agent for the Federal Government. For 
purposes of this subpart, the term ``debt'' does not include debts 
arising under the Internal Revenue Code of 1986 (26 U.S.C. 1 et seq.).
    (g) Delinquent debt record means information about a past-due, 
legally enforceable debt, submitted by GSA to FMS for purposes of 
administrative offset (including salary offset) in accordance with the 
provisions of 31 U.S.C. 3716(c)(6) and applicable regulations. Debt 
information includes the amount and type of debt and the debtor's name, 
address, and taxpayer identifying number.
    (h) Disbursing official means an officer or employee designated to 
disburse Federal salary payments. This includes all disbursing 
officials of Federal salary payments, including but not limited to, 
disbursing officials of the Department of the Treasury, the Department 
of Defense, the United States Postal Service, any government 
corporation, and any disbursing official of the United States 
designated by the Secretary.
    (i) Disposable pay means the amount that remains from an employee's 
Federal pay after required deductions for Federal, State and local 
income taxes; Social Security taxes, including Medicare taxes; Federal 
retirement programs, including contributions to the Thrift Savings Plan 
(TSP); premiums for life (excluding amounts deducted for supplemental 
coverage) and health insurance benefits; Internal Revenue Service (IRS) 
tax levies; and such other deductions that are required by law to be 
withheld.
    (j) Federal employee means a current employee of an agency, 
including a current member of the Armed Forces or a Reserve of the 
Armed Forces (Reserves), employees of the United States Postal Service, 
and seasonal and temporary employees.
    (k) Federal employee records means records of Federal salary 
payments that a paying agency has certified to a disbursing official 
for disbursement.
    (l) FMS means the Financial Management Service, a bureau of the 
Department of the Treasury.
    (m) For the purposes of the standards in this subpart, unless 
otherwise stated, the term ``Administrator'' refers to the 
Administrator of General Services or the Administrator's delegate.
    (n) For the purposes of the standards in this subpart, unless 
otherwise stated, the terms ``GSA'' and ``Agency'' are synonymous and 
interchangeable.
    (o) 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.
    (p) Paying agency means the agency that employs the Federal 
employee who owes the debt and authorizes the payment of his or her 
current pay. A paying agency also includes an agency that performs 
payroll services on behalf of the employing agency.
    (q) Salary offset means administrative offset to collect a debt 
owed by a Federal employee from the current pay account of the 
employee.
    (r) Secretary means the Secretary of the Treasury or his or her 
delegate.
    (s) Taxpayer identifying number means the identifying number 
described under section 6109 of the Internal Revenue Code of 1986 (26 
U.S.C. 6109).

[[Page 68757]]

For an individual, the taxpayer identifying number is the individual's 
social security number.


Sec.  105-56.016  GSA participation.

    (a) As required under 5 U.S.C. 5514(a)(1), GSA must participate at 
least annually in centralized salary offset computer matching. To meet 
this requirement, GSA will notify FMS of all past-due, legally 
enforceable debts delinquent for more than 180 days for purposes of 
administrative offset, as required under 31 U.S.C. 3716(c)(6). 
Additionally, GSA may notify FMS of past-due, legally enforceable debts 
delinquent for less than 180 days for purposes of administrative 
offset.
    (b) Prior to submitting a debt to FMS for purposes of collection by 
administrative offset, including salary offset, GSA will provide 
written certification to FMS that--
    (1) The debt is past-due and legally enforceable in the amount 
submitted to FMS and that GSA will ensure that collections (other than 
collections through offset) are properly credited to the debt;
    (2) Except in the case of a judgment debt or as otherwise allowed 
by law, the debt is referred for offset within ten years after GSA's 
right of action accrues;
    (3) GSA has complied with the provisions of 31 U.S.C. 3716 
(administrative offset) and related regulations including, but not 
limited to, the provisions requiring that GSA provide the debtor with 
applicable notices and opportunities for a review of the debt; and
    (4) GSA has complied with the provisions of 5 U.S.C. 5514 (salary 
offset) and related regulations including, but not limited to, the 
provisions requiring that GSA provide the debtor with applicable 
notices and opportunities for a hearing.
    (c) FMS may waive the certification requirement set forth in 
paragraph (b)(4) of this section as a prerequisite to submitting the 
debt to FMS. If FMS waives the certification requirement, before an 
offset occurs, GSA will provide the Federal employee with the notices 
and opportunities for a hearing as required by 5 U.S.C. 5514 and 
applicable regulations, and will certify to FMS that the requirements 
of 5 U.S.C. 5514 and applicable regulations have been met.
    (d) GSA will notify FMS immediately of any payments credited by GSA 
to the debtor's account, other than credits for amounts collected by 
offset, after submission of the debt to FMS. GSA will notify FMS once 
the debt is paid in its entirety. GSA will also notify FMS immediately 
of any change in the status of the legal enforceability of the debt, 
for example, if the Agency receives notice that the debtor has filed 
for bankruptcy protection.


Sec.  105-56.017  Centralized salary offset computer match.

    (a) Delinquent debt records will be compared with Federal employee 
records maintained by members of the consortium or paying agencies. The 
records will be compared to identify Federal employees who owe 
delinquent debts for purposes of collecting the debt by administrative 
offset. A match will occur when the taxpayer identifying number and 
name of a Federal employee are the same as the taxpayer identifying 
number and name of a debtor.
    (b) As authorized by the provisions of 31 U.S.C. 3716(f), FMS, 
under a delegation of authority from the Secretary, has waived certain 
requirements of the Computer Matching and Privacy Protection Act of 
1988, 5 U.S.C. 552a, as amended, for administrative offset, including 
salary offset, upon written certification by the Administrator, or the 
Administrator's delegate, that the requirements of 31 U.S.C. 3716(a) 
have been met. Specifically, FMS has waived the requirements for a 
computer matching agreement contained in 5 U.S.C. 552a(o) and for post-
match notice and verification contained in 5 U.S.C. 552a(p). GSA will 
provide certification in accordance with the provisions of Sec.  105-
56.016(b)(3) of this subpart.


Sec.  105-56.018  Salary offset.

    When a match occurs and all other requirements for offset have been 
met, as required by the provisions of 31 U.S.C. 3716(c), the disbursing 
official will offset the Federal employee's salary payment to satisfy, 
in whole or part, the debt owed by the employee. Alternatively, the 
paying agency, on behalf of the disbursing official, may deduct the 
amount of the offset from an employee's disposable pay before the 
employee's salary payment is certified to a disbursing official for 
disbursement.


Sec.  105-56.019  Offset amount.

    (a) The minimum dollar amount referred for offset under this 
subpart is $100.
    (b) The amount offset from a salary payment under this subpart will 
be the lesser of--
    (1) The amount of the debt, including any interest, penalties and 
administrative costs; or
    (2) Up to 15 percent of the debtor's disposable pay.
    (c) Alternatively, the amount offset may be an amount agreed upon, 
in writing, by the debtor and GSA.
    (d) Offsets will continue until the debt, including any interest, 
penalties, and administrative costs, is paid in full or otherwise 
resolved to the satisfaction of GSA.


Sec.  105-56.020  Priorities.

    (a) A levy pursuant to the Internal Revenue Code of 1986 (26 U.S.C. 
1 et seq.) takes precedence over other deductions under this subpart.
    (b) When a salary payment may be reduced to collect more than one 
debt, amounts offset under this subpart will be applied to a debt only 
after amounts offset have been applied to satisfy past due child 
support debts assigned to a State pursuant to the Social Security Act 
under 42 U.S.C. 602(a)(26) or 671(a)(17).


Sec.  105-56.021  Notice.

    (a) Before offsetting a salary payment, the disbursing official, or 
the paying agency on behalf of the disbursing official, will notify the 
Federal employee in writing of the date deductions from salary will 
commence and of the amount of such deductions.
    (b)(1) When an offset occurs under this subpart, the disbursing 
official, or the paying agency on behalf of the disbursing official, 
will notify the Federal employee in writing that an offset has occurred 
including--
    (i) A description of the payment and the amount of offset taken;
    (ii) The identity of GSA as the creditor agency requesting the 
offset; and
    (iii) A contact point within GSA that will handle concerns 
regarding the offset.
    (2) The information described in paragraphs (b)(1)(ii) and 
(b)(1)(iii) of this section does not need to be provided to the Federal 
employee when the offset occurs if such information was included in a 
prior notice from the disbursing official or paying agency.
    (c) The disbursing official will advise GSA of the names, mailing 
addresses, and taxpayer identifying numbers of the debtors from whom 
amounts of past-due, legally enforceable debt were collected and of the 
amounts collected from each debtor for GSA. The disbursing official 
will not advise GSA of the source of payment from which the amounts 
were collected.


Sec.  105-56.022  Fees.

    Agencies that perform centralized salary offset computer matching 
services may charge a fee sufficient to cover the full cost for such 
services. In addition, FMS, or a paying agency acting on behalf of FMS, 
may charge a fee

[[Page 68758]]

sufficient to cover the full cost of implementing the administrative 
offset program. FMS may deduct the fees from amounts collected by 
offset or may bill GSA. Fees charged for offset will be based on actual 
administrative offsets completed and may be added to the debt as an 
administrative cost.


Sec.  105-56.023  Disposition of amounts collected.

    (a) The disbursing official conducting the offset will transmit 
amounts collected for debts, less fees charged under Sec.  105-56.022 
of this subpart, to GSA.
    (b) If an erroneous offset payment is made to GSA, the disbursing 
official will notify GSA that an erroneous offset payment has been 
made.
    (1) The disbursing official may deduct the amount of the erroneous 
offset payment from future amounts payable to GSA; or
    (2) Alternatively, upon the disbursing official's request, GSA will 
promptly return to the disbursing official or the affected payee an 
amount equal to the amount of the erroneous payment (without regard to 
whether any other amounts payable to GSA have been paid).
    (i) The disbursing official and GSA will adjust the debtor records 
appropriately.
    (ii) Unless required by Federal law or contract, refunds under this 
subpart will not bear interest.

Subpart C--Centralized Salary Offset (CSO) Procedures--GSA as 
Paying Agency


Sec.  105-56.024  Purpose and scope.

    (a) This subpart establishes procedures for the offset of Federal 
salary payments, through the Financial Management Service's (FMS) 
administrative offset program, to collect delinquent debts owed to the 
Federal Government. This process is known as salary offset. Rules 
issued by the Office of Personnel Management contain the requirements 
Federal agencies must follow prior to conducting salary offset and the 
procedures for requesting offsets directly from a paying agency. See 5 
CFR parts 550.1101 through 550.1108.
    (b) This subpart implements the requirement under 5 U.S.C. 
5514(a)(1) that all Federal agencies, using a process known as 
centralized salary offset computer matching, identify Federal employees 
who owe delinquent non-tax debt to the United States. Centralized 
salary offset computer matching is the computerized comparison of 
delinquent debt records with records of Federal employees. The purpose 
of centralized salary offset computer matching is to identify those 
debtors whose Federal salaries should be offset to collect delinquent 
debts owed to the Federal Government.
    (c) This subpart specifies the delinquent debt records and Federal 
employee records that must be included in the salary offset matching 
process. For purposes of this subpart, delinquent debt records consist 
of the debt information submitted to FMS for purposes of administrative 
offset as required under 31 U.S.C. 3716(c)(6).
    (d) An interagency consortium was established to implement 
centralized salary offset computer matching on a Governmentwide basis 
as required under 5 U.S.C. 5514(a)(1). Federal employee records consist 
of records of Federal salary payments disbursed by members of the 
consortium.


Sec.  105-56.025  Definitions.

    The following definitions apply to this subpart:
    (a) Administrative offset means withholding funds payable by the 
United States to, or held by the United States for, a person to satisfy 
a debt owed by the payee.
    (b) Agency means a department, agency or sub-agency, court, court 
administrative office, or instrumentality in the executive, judicial, 
or legislative branch of the Federal Government, including Government 
corporations.
    (c) Centralized salary offset computer matching means the 
computerized comparison of Federal employee records with delinquent 
debt records to identify Federal employees who owe such debts.
    (d) Consortium means an interagency group established by the 
Secretary of the Treasury to implement centralized salary offset 
computer matching. The group includes all agencies that disburse 
Federal salary payments.
    (e) Creditor agency means any agency that is owed a debt, including 
a debt collection center when acting on behalf of a creditor agency in 
matters pertaining to the collection of a debt.
    (f) Cross-serviced agency means an arrangement between GSA and 
another agency whereby GSA provides financial support services to the 
other agency on a reimbursable basis. Financial support services can 
range from simply providing computer and software timesharing services 
to full-service administrative processing.
    (g) Debt means any amount of money, funds, or property that has 
been determined by an appropriate official of the Federal Government to 
be owed to the United States by a person, including debt administered 
by a third party acting as an agent for the Federal Government. For 
purposes of this subpart, the term ``debt'' does not include debts 
arising under the Internal Revenue Code of 1986 (26 U.S.C. 1 et seq.).
    (h) Delinquent debt record means information about a past-due, 
legally enforceable debt, submitted to GSA by FMS for purposes of 
administrative offset (including salary offset) in accordance with the 
provisions of 31 U.S.C. 3716(c)(6) and applicable regulations. Debt 
information includes the amount and type of debt and the debtor's name, 
address, and taxpayer identifying number.
    (i) Disbursing official means an officer or employee designated to 
disburse Federal salary payments. This includes all disbursing 
officials of Federal salary payments, including but not limited to, 
disbursing officials of the Department of the Treasury, the Department 
of Defense, the United States Postal Service, any government 
corporation, and any disbursing official of the United States 
designated by the Secretary.
    (j) Disposable pay means the amount that remains from an employee's 
Federal pay after required deductions for Federal, State and local 
income taxes; Social Security taxes, including Medicare taxes; Federal 
retirement programs, including contributions to the Thrift Savings Plan 
(TSP); premiums for life (excluding amounts deducted for supplemental 
coverage) and health insurance benefits; Internal Revenue Service (IRS) 
tax levies; and such other deductions that are required by law to be 
withheld.
    (k) Employee means any individual employed by GSA or a cross-
serviced agency of the executive, legislative, or judicial branches of 
the Federal Government, including Government corporations.
    (l) Federal employee records means records of Federal salary 
payments that a paying agency has certified to a disbursing official 
for disbursement.
    (m) FMS means the Financial Management Service, a bureau of the 
Department of the Treasury.
    (n) 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.
    (o) Paying agency means the agency that employs the Federal 
employee who owes the debt and authorizes the payment of his or her 
current pay. A paying agency also includes an agency that performs 
payroll services on behalf of the employing agency.
    (p) Salary offset means administrative offset to collect a debt 
owed by a

[[Page 68759]]

Federal employee from the current pay account of the employee.
    (q) Secretary means the Secretary of the Treasury or his or her 
delegate.
    (r) Taxpayer identifying number means the identifying number 
described under section 6109 of the Internal Revenue Code of 1986 (26 
U.S.C. 6109). For an individual, the taxpayer identifying number is the 
individual's social security number.


Sec.  105-56.026  GSA participation.

    (a) As required under 5 U.S.C. 5514(a)(1), creditor agencies must 
participate at least annually in centralized salary offset computer 
matching. To meet this requirement, creditor agencies will notify FMS 
of all past-due, legally enforceable debts delinquent for more than 180 
days for purposes of administrative offset, as required under 31 U.S.C. 
3716(c)(6). Additionally, creditor agencies may notify FMS of past-due, 
legally enforceable debts delinquent for less than 180 days for 
purposes of administrative offset.
    (b) Prior to submitting a debt to FMS for purposes of collection by 
administrative offset, including salary offset, creditor agencies will 
provide written certification to FMS that--
    (1) The debt is past-due and legally enforceable in the amount 
submitted to FMS and that the creditor agency will ensure that 
collections (other than collections through offset) are properly 
credited to the debt;
    (2) Except in the case of a judgment debt or as otherwise allowed 
by law, the debt is referred for offset within ten years after the 
creditor agency's right of action accrues;
    (3) The creditor agency has complied with the provisions of 31 
U.S.C. 3716 (administrative offset) and related regulations including, 
but not limited to, the provisions requiring the creditor agency to 
provide the debtor with applicable notices and opportunities for a 
review of the debt; and
    (4) The creditor agency has complied with the provisions of 5 
U.S.C. 5514 (salary offset) and related regulations including, but not 
limited to, the provisions requiring the creditor agency to provide the 
debtor with applicable notices and opportunities for a hearing.
    (c) FMS may waive the certification requirement set forth in 
paragraph (b)(4) of this section as a prerequisite to submitting the 
debt to FMS. If FMS waives the certification requirement, before an 
offset occurs, the creditor agency will provide the Federal employee 
with the notices and opportunities for a hearing as required by 5 
U.S.C. 5514 and applicable regulations, and will certify to FMS that 
the requirements of 5 U.S.C. 5514 and applicable regulations have been 
met.
    (d) The creditor agency will notify FMS immediately of any payments 
credited by the agency to the debtor's account, other than credits for 
amounts collected by offset, after submission of the debt to FMS. The 
creditor agency will notify FMS once the debt is paid in its entirety. 
The creditor agency will also notify FMS immediately of any change in 
the status of the legal enforceability of the debt, for example, if the 
agency receives notice that the debtor has filed for bankruptcy 
protection.


Sec.  105-56.027  Centralized salary offset computer match.

    (a) Delinquent debt records will be compared with Federal employee 
records maintained by members of the consortium or paying agencies. The 
records will be compared to identify Federal employees who owe 
delinquent debts for purposes of collecting the debt by administrative 
offset. A match will occur when the taxpayer identifying number and 
name of a Federal employee are the same as the taxpayer identifying 
number and name of a debtor.
    (b) As authorized by the provisions of 31 U.S.C. 3716(f), FMS, 
under a delegation of authority from the Secretary, has waived certain 
requirements of the Computer Matching and Privacy Protection Act of 
1988, 5 U.S.C. 552a, as amended, for administrative offset, including 
salary offset, upon written certification by the creditor agency, that 
the requirements of 31 U.S.C. 3716(a) have been met. Specifically, FMS 
has waived the requirements for a computer matching agreement contained 
in 5 U.S.C. 552a(o) and for post-match notice and verification 
contained in 5 U.S.C. 552a(p).


Sec.  105-56.028  Salary offset.

    When a match occurs and all other requirements for offset have been 
met, as required by the provisions of 31 U.S.C. 3716(c), the disbursing 
official will offset the GSA employee's or cross-serviced agency 
employee's salary payment to satisfy, in whole or part, the debt owed 
by the employee. Alternatively, the GSA National Payroll Center, 
serving as the paying agency, on behalf of the disbursing official, may 
deduct the amount of the offset from an employee's disposable pay 
before the employee's salary payment is certified to a disbursing 
official for disbursement.


Sec.  105-56.029  Offset amount.

    (a) The minimum dollar amount of salary offset under this subpart 
is $100.
    (b) The amount offset from a salary payment under this subpart will 
be the lesser of--
    (1) The amount of the debt, including any interest, penalties and 
administrative costs; or
    (2) Up to 15 percent of the debtor's disposable pay.
    (c) Alternatively, the amount offset may be an amount agreed upon, 
in writing, by the debtor and the creditor agency.
    (d) Offsets will continue until the debt, including any interest, 
penalties, and administrative costs, is paid in full or otherwise 
resolved to the satisfaction of the creditor agency.


Sec.  105-56.030  Priorities.

    GSA, acting as the paying agency, on behalf of the disbursing 
official, will apply the order of precedence when processing debts 
identified by the centralized salary offset computer match program as 
follows:
    (a) A levy pursuant to the Internal Revenue Code of 1986 (26 U.S.C. 
1 et seq.) takes precedence over other deductions under this subpart.
    (b) When a salary payment may be reduced to collect more than one 
debt, amounts offset under this subpart will be applied to a debt only 
after amounts offset have been applied to satisfy past due child 
support debts assigned to a State pursuant to the Social Security Act 
under 42 U.S.C. 602(a)(26) or 671(a)(17).


Sec.  105-56.031  Notice.

    (a) The disbursing official will provide GSA an electronic list of 
the names, mailing addresses, and taxpayer identifying numbers of the 
debtors from whom amounts of past-due, legally enforceable debt are due 
other Federal agencies. The disbursing official will identify the 
creditor agency name and a point of contact that will handle concerns 
regarding the debt.
    (b) Before offsetting a salary payment, the GSA National Payroll 
Center, acting as the paying agency on behalf of the disbursing 
official, will notify the debtor in writing of the date deductions from 
salary will commence and of the amount of such deductions.
    (c)(1) When an offset occurs under this subpart, the disbursing 
official, or the GSA National Payroll Center on behalf of the 
disbursing official, will notify the debtor in writing that an offset 
has occurred including--
    (i) A description of the payment and the amount of offset taken;
    (ii) The identity of the creditor agency identified by the 
disbursing official requesting the offset; and

[[Page 68760]]

    (iii) A contact point at the creditor agency identified by the 
disbursing official that will handle concerns regarding the offset.
    (2) The information described in paragraphs (c)(1)(ii) and 
(c)(1)(iii) of this section does not need to be provided to the debtor 
when the offset occurs if such information was included in a prior 
notice from the disbursing official or the creditor agency.


Sec.  105-56.032  Fees.

    GSA, while performing centralized salary offset computer matching 
services, may charge a fee sufficient to cover the full cost for such 
services. In addition, FMS, or GSA acting as the paying agency on 
behalf of FMS, may charge a fee sufficient to cover the full cost of 
implementing the administrative offset program. FMS may deduct the fees 
from amounts collected by offset or may bill the creditor agency. Fees 
charged for offset will be based on actual administrative offsets 
completed.


Sec.  105-56.033  Disposition of amounts collected.

    (a) The disbursing official conducting the offset will transmit 
amounts collected for debts, less fees charged under Sec.  105-56.032 
of this subpart, to the creditor agency.
    (b) If an erroneous offset payment is made to the creditor agency, 
the disbursing official will notify the creditor agency that an 
erroneous offset payment has been made.
    (1) The disbursing official may deduct the amount of the erroneous 
offset payment from future amounts payable to the creditor agency; or
    (2) Alternatively, upon the disbursing official's request, the 
creditor agency will promptly return to the disbursing official or the 
affected payee an amount equal to the amount of the erroneous payment 
(without regard to whether any other amounts payable to the creditor 
agency have been paid). The disbursing official and the creditor agency 
will adjust the debtor records appropriately.

[FR Doc. 03-30408 Filed 12-9-03; 8:45 am]
BILLING CODE 6820-23-P