Salary Offset

LIBRARY OF CONGRESS

36 CFR Part 705

[Docket No. LOC 94-1]

Salary Offset

AGENCY: Library of Congress.

ACTION: Final regulation.

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SUMMARY: The Library of Congress is authorized to collect debts owed by

current and former staff members to the Federal Government by making

deductions from the current pay account of the individual. The Library

of Congress is issuing this final regulation to prescribe the

procedures the Library will follow when collecting a debt owed to the

Federal Government via deductions from an employee's pay. It also

describes the rights of current employees, former employees who owe

debts to other agencies, and former employees who are currently

employed by other agencies in the collection of debts owed to the

Federal Government by them and sets out the procedures for collecting

debts through deductions from their pay following due process.

EFFECTIVE DATE: July 28, 1994.

FOR FURTHER INFORMATION CONTACT: Johnnie M. Barksdale, Regulations

Officer, Office of the General Counsel, Library of Congress,

Washington, DC 20540-1050. Telephone No. (202) 707-1593.

SUPPLEMENTARY INFORMATION: Under section 5514 of title 5 U.S.C. and 5

CFR 550.1101, when an agency head or his/her designee determines that

an employee is indebted to the Federal Government, he/she will

authorize the collection of that indebtedness in monthly installments

or at officially established pay intervals, by deduction from the

current pay account of the individual. The amount deducted for any

period may not exceed 15 percent of disposable pay, except that a

greater percentage may be deducted upon the written consent of the

individual involved. If the individual retires or resigns, or if his/

her employment otherwise ends, before collection of the amount of the

indebtedness is completed, deductions shall be made from subsequent

payments of any nature due the individual from the agency concerned.

This final Regulation sets out the procedures the Library of Congress

will follow when collecting debts through deductions from the

employee's pay following due process.

The proposed regulation was published in the Federal Register on

May 27, 1994, for public comment. No comments were received. No changes

were made to the text.

List of Subjects in 36 CFR Part 705

Salary offset.

Final Regulation

In consideration of the foregoing the Library of Congress

promulgates a new Part 705 of 36 CFR chapter 7, reading as follows:

PART 705--FINANCIAL ADMINISTRATION

Sec.

705.1 Salary Offset.

Authority: 5 U.S.C. 5514 and 5 CFR 550.1101.

705.1 Salary offset

(a) Purpose. This part describes the rights of current and former

staff members in the collection of debts owed to the Federal Government

by them and sets out the procedures for collecting debts through

deductions from their pay following due process.

(b) Definitions.--(1) Debt is an amount owed to the U.S. Government

from insured or guaranteed loans, fees, leases, rents, royalties,

services, sales of real or personal property, overpayments, penalties,

damages, interest, fines and forfeitures (except those arising under

the Uniform Code of Military Justice), and all other similar sources.

(2) Disposable pay, for purposes of this part, means that part of

current basic pay, special pay, incentive pay, retirement pay, retainer

pay, or other authorized pay remaining after the deduction of any

amount required by law to be withheld, such as Federal taxes,

retirement, court-ordered payments, and FICA.

(3) Staff member refers to current and former employees who owe

debts to the Library and/or other Federal Government agencies.

(c) Procedures.--(1) Notification of indebtedness. The Director of

Human Resources, or designee, shall notify the staff member, in

writing, of the individual's indebtedness to the Library and the

intention of the Library to collect this debt by deductions from the

individual's pay. This notice shall be given not less than 30 days

before any deduction is made. This notice shall state, at a minimum:

(i) The Library's determination that a debt is owed, including the

origin, nature, and amount of the debt;

(ii) The Library's intention to collect the debt by means of

deduction from the staff member's disposable pay account;

(iii) The amount, frequency, proposed beginning date, and duration

of the intended deductions;

(iv) An explanation of the Library's policy concerning interest,

penalties, and administrative costs, including a statement that such

assessments must be made unless excused;

(v) The staff member's right to inspect and to copy Government

records relating to the debt or, if he or she or his or her

representative cannot personally inspect the records, to request and

receive a copy of such records;

(vi) If not previously provided, the opportunity (under terms

agreeable to the Library) to establish a schedule for the voluntary

repayment of the debt or to enter into a written agreement to establish

a schedule for the repayment of the debt in lieu of offset (the

agreement must be in writing, signed by both the staff member and the

Library, and documented in the Library's files);

(vii) The staff member's right to a hearing conducted by an

official arranged for or engaged by the Library (an administrative law

judge or, alternatively, a hearing official not under the control of

the Librarian of Congress) if a petition is filed as prescribed by the

Library;

(viii) The method and time period for petitioning for a hearing;

(ix) That the timely filing of a petition for hearing will stay the

commencement of collection proceedings;

(x) That a final decision on the hearing, if one is requested, will

be issued at the earliest practicable date, but not later than 60 days

after the filing of the petition requesting the hearing unless the

staff member requests and the hearing official grants a delay in the

proceedings;

(xi) That any knowingly false or frivolous statements,

representations, or evidence may subject the staff member to

(A) Disciplinary procedures appropriate under Library of Congress

Regulation 2020-3, or any other applicable regulations or statutes,

(B) Penalties under the False Claim Act, Section 3729 of Title 31,

U.S. Code, or any other applicable statutory authority, or

(C) Criminal penalties under Sections 286, 287, 1001, and 1002 of

Title 18, U.S. Code, or any other applicable statutory authority;

(xii) Any other rights and remedies available to the staff member

under statutes or regulations governing the program for which the

collection is being made;

(xiii) Unless there are applicable contractual or statutory

provisions to the contrary, that amounts paid on or deducted for the

debt which are later waived or found not owed to the United States will

be promptly refunded to the staff member;

(xiv) That if the staff member elects not to contest the

determination of indebtedness or the amount or the terms of a repayment

schedule, the staff member may still wish to exercise the right to

request a waiver of the collection of the indebtedness pursuant to the

provisions of Library of Congress Regulation 1556, Claims (if the

amount of the indebtedness exceeds $1,500, the staff member should be

advised that a final determination must be made by the Comptroller

General of the United States); and

(xv) That any involuntary payments already made or withheld from

salary of any portion of the indebtedness will not be construed as a

waiver by the staff member of any rights that he or she may have under

this part.

(2) Amount of deduction. If possible, the debt shall be collected

in one lump sum. If multiple deductions are necessary, however, the

amount deducted from a staff member's pay for any single period will

not exceed 15 percent of disposable pay, except that a greater

percentage may be deducted upon the written consent of the individual

involved. The staff member may enter into a written agreement for a

repayment schedule different from that proposed so long as the terms

are approved by the Library. If the individual retires or resigns or if

his or her employment otherwise ends before collection of the amount of

the indebtedness is completed, deduction shall be made from subsequent

payments of any nature due the individual.

(3) Petitions for hearing. (i) To elect a hearing, the staff member

must notify the Director, Human Resources, no later than 15 days after

the receipt of the notification of indebtedness. A timely filing of a

petition for hearing will stay any further commencement of collection

proceedings. A final decision on the hearing will be issued at the

earliest practicable date, but not later than 60 days after the filing

of petition, unless the individual requests and the hearing official

grants a delay in the proceedings.

(ii) The petition or statement must be signed by the staff member

and must fully identify and explain with reasonable specificity all the

facts, evidence, and witnesses, if any, which he or she believes

supports his or her position.

(iii) Petitions for hearings made later than 15 days after the

receipt of the notification of indebtedness will be accepted provided

the staff member 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 (unless otherwise aware of it).

(4) Form of hearings and final decisions. (i) The staff member

shall be provided an appropriate hearing as decided by the hearing

official, based on the nature of the transactions giving rise to the

debt. The hearing official shall be guided by the procedures set out in

4 CFR 102.3(c) in deciding on the type of hearing to provide.

(ii) A written decision will be provided to the staff member and

must, at a minimum, state the fact(s) purported to support the nature

and origin of the alleged debt; the hearing official's analysis,

findings, and conclusions, in light of the hearing, as to the staff

member's or the Library's grounds; the amount and validity of the

alleged debt; and, where applicable, the repayment schedule.

(d) Creditor agency is not the Library of Congress. When the

Library receives from a creditor agency a debt claim properly certified

in accordance with 5 CFR 550.1108(a), deductions shall be scheduled to

begin at the next officially established pay interval. The Director,

Human Resources, shall provide the employee with written notice stating

that the Library has received a certified debt claim from the creditor

agency (including the amount) and written notice of the date deductions

from salary will commence and of the amount of such deductions. When

the Library receives an incomplete debt claim from a creditor agency,

the Director, Human Resources, shall return the debt claim with a

written notice that procedures under 5 U.S.C. 5514 must be followed and

a properly determined debt claim received before action will be taken

to collect from the employee's pay account.

(e) Exclusions and exceptions. (1) This part does not apply to

debts where collection of the debt is explicitly provided for or

prohibited by another statute, or to debts of $1 or less, which, it is

hereby determined, is not cost effective to attempt to collect (65

Comp. Gen. 843, September 29, 1986).

(2) An exception to the entitlement of notice, hearings, written

responses, and final decisions provided for under paragraph (c) of this

section is made for overpayments arising out of an employee's election

of coverage or a change in coverage under a Federal benefits program

requiring periodic deductions from pay, if the amount to be recovered

was accumulated over four pay periods or less.

Dated: July 18, 1994.

James H. Billington,

The Librarian of Congress.

[FR Doc. 94-18400 Filed 7-27-94; 8:45 am]

BILLING CODE 1410-01-P