Debt Collection

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

Office of Federal Housing Enterprise Oversight

12 CFR Part 1730

RIN 2550-AA07

Debt Collection

AGENCY: Office of Federal Housing Enterprise Oversight, HUD.

ACTION: Interim regulation with request for comments.

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SUMMARY: The Office of Federal Housing Enterprise Oversight (OFHEO) is

issuing an interim regulation that sets forth procedures for use by

OFHEO in collecting debts owed to the Federal Government. The Federal

Claims Collection Act of 1966, as amended by the Debt Collection Act of

1982 and the Debt Collection Improvement Act of 1996, requires agencies

to issue a regulation on their debt collection procedures. The interim

regulation includes procedures for collection of debts through salary

offset, administrative offset, and tax refund offset. OFHEO requests

comments on the interim regulation.

DATES: The interim regulation is effective June 30, 1999. Written

comments on the interim regulation must be received by August 30, 1999.

ADDRESSES: Send written comments concerning the interim regulation to

Anne E. Dewey, General Counsel, Office of Federal Housing Enterprise

Oversight, Fourth Floor, 1700 G Street, NW., Washington, DC 20552.

Written comments may also be sent to Ms. Dewey by electronic mail at

[email protected]

FOR FURTHER INFORMATION CONTACT: Isabella W. Sammons, Associate General

Counsel, telephone (202) 414-3751 (not a toll-free number); or Gail

Palestine, Financial Management Officer, telephone (202) 414-3816 (not

a toll-free number), Office of Federal Housing Enterprise Oversight,

Fourth Floor, 1700 G Street, NW., Washington, DC 20552. The telephone

number for the Telecommunications Device for the Deaf is (800) 877-

8339.

SUPPLEMENTARY INFORMATION:

Discussion of the Interim Regulation

The interim regulation implements the requirements of the Federal

Claims Collection Act, Pub. L. 89-508, 80 Stat. 308 (1966), as amended

by the Debt Collection Act of 1982, Pub. L. 97-365, 96 Stat. 1749

(1982), and the Debt Collection Improvement Act of 1966, Pub. L. 104-

134, 110 Stat. 1321 (1996). The interim regulation provides that OFHEO

will attempt to collect debts owed to the Federal Government either

directly or by salary offset, administrative offset, or tax refund

offset.

Subpart A of the interim regulation addresses the collection of

debts in general and incorporates the debt collection procedures of the

Federal Claims Collection Standards (FCCS) at 4 CFR chapter II. A

revised FCCS has been proposed jointly by the Department of Justice and

the Department of the Treasury. 62 FR 68476-01, Dec. 31, 1997. OFHEO

will amend, as necessary, its Debt Collection regulation after the

revised FCCS has been issued as a final regulation.

Subpart A also provides, in accordance with applicable law and

regulations, that OFHEO will transfer debts that are delinquent for

over 180 days to the Secretary of the Department of the Treasury for

collection or other appropriate action. It further provides that debts

that are delinquent for less than 180 days may be referred to debt

collection centers for collection.

Subpart B of the interim regulation sets forth the procedures that

will be used by OFHEO to collect debts owed to the Federal Government

by OFHEO employees and former OFHEO employees who are employed by other

agencies. When an employee of an agency is indebted to the Federal

Government, the agency may collect the debt by salary offset, that is,

by deductions from the current pay account of the employee. 5 U.S.C.

5514(a)(1).

The procedures for salary offset are governed by 5 U.S.C. 5514, and

by Office of Personnel Management (OPM) regulations at 5 CFR part 550,

subpart K (63 FR 72098, Dec. 31, 1998). Agencies are required to

promulgate their own salary offset regulations, 5 U.S.C. 5514(b)(1),

that must conform with the OPM regulations and be approved by OPM

before they become effective. 5 CFR 550.1105(a)(1). The salary offset

provisions of subpart B of the interim regulation have been reviewed

and approved by OPM.

Subpart C of the interim regulation sets forth the procedures that

OFHEO will use to collect debts by administrative offset, if salary

offset is not applicable or appropriate. Under this method of

collection, an agency collects a debt from a debtor by withholding

money that is either payable to the debtor or held by the Federal

Government for the debtor. 31 U.S.C. 3716. Subpart C is consistent with

the procedures of administrative offset set forth in 31 U.S.C. 3716 and

the FCCS.

Subpart D of the interim regulation sets forth the procedures used

for collection by the tax refund offset. If collection by salary offset

or administrative offset is not feasible, an agency must seek to

recover monies owed it by requesting that the Internal Revenue Service

reduce a tax refund to a debtor by the amount of the debt and pay such

monies to the agency. 31 U.S.C. 3720A, 26 CFR 301.6402-6. In order to

use the tax refund offset method of collection, the Internal Revenue

Service requires that the agency promulgate temporary or permanent

regulations covering all three collection methods: salary offset,

administrative offset, and tax refund offset. 31 U.S.C. 3720A(b)(4), 26

CFR 301.6402-6(b). The publication of this interim regulation satisfies

that requirement.

Effective Date and Request for Comments

OFHEO has determined that this interim regulation pertains to

agency practice and procedure and is interpretative in nature. The

procedures contained in the interim regulation for salary offset,

administrative offset, and tax refund offset are mandated by law and by

regulations promulgated by OPM, jointly by the Department of the

Treasury and the Department of Justice, and by the IRS. Therefore, the

interim regulation is not subject to the Administrative Procedure Act

(APA) and the requirements of the APA for a notice and comment period

and for a delayed effective date. 5 U.S.C. 553(b) and (c).

Nevertheless, OFHEO requests comments from the public and will take all

comments into consideration before promulgating the final regulation.

Copies of all comments received will be available for examination by

the public at the Office of Federal Housing Enterprise Oversight,

Fourth Floor, 1700 G Street, NW., Washington, DC 20552.

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Regulatory Impact

Executive Order 12866, Regulatory Planning and Review

This interim regulation is not classified as a significant rule

under Executive Order 12866 because it will not result in (1) an annual

effect on the economy of $100 million or more; (2) a major increase in

costs or prices for consumers, individual industries, Federal, State,

or local government agencies, or geographic regions; or (3) significant

adverse effects on competition, employment, investment, productivity,

innovation, or on the ability of United States-based enterprises to

compete with foreign-based enterprises in domestic or foreign markets.

Accordingly, no regulatory impact assessment is required and this

interim regulation has not been submitted to the Office of Management

and Budget for review.

Regulatory Flexibility Act

The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires that

a regulation that has a significant economic impact on a substantial

number of small entities, small businesses, or small organizations must

include an initial regulatory flexibility analysis describing the

regulation's impact on small entities. Such an analysis need not be

undertaken if the agency has certified that the regulation will not

have a significant economic impact on a substantial number of small

entities. 5 U.S.C. 605(b). OFHEO has considered the impact of this

interim regulation under the Regulatory Flexibility Act. Of the few

debts that have been owed to OFHEO, most have been owed by individuals

rather than business entities. Therefore, the General Counsel of OFHEO

certifies that the interim regulation is not likely to have a

significant economic impact on a substantial number of small business

entities.

Paperwork Reduction Act

This interim regulation does not contain any information collection

requirements that require the approval of the Office of Management and

Budget under the Paperwork Reduction Act (44 U.S.C. 3501 et seq.).

Unfunded Mandates Reform Act of 1995

This interim regulation does not require the preparation of an

assessment statement in accordance with the Unfunded Mandates Reform

Act of 1995, 2 U.S.C. 1531. Assessment statements are not required for

regulations that incorporate requirements specifically set forth in

law. As explained in the preamble, this regulation implements specific

statutory requirements. In addition, this regulation does not include a

Federal mandate that may result in the expenditure by State, local, and

tribal governments, in the aggregate, or by the private sector, of $100

million or more (adjusted annually for inflation) in any one year.

Submission to Congress and the General Accounting Office

Under 5 U.S.C. 801(a)(1)(A), OFHEO has submitted a report

containing this interim regulation and other required information to

each House of Congress and the Comptroller General of the United States

before publication of this interim regulation in the Federal Register.

The interim regulation is not a major rule as defined at 5 U.S.C.

804(2).

List of Subjects in 12 CFR Part 1730

Administrative practice and procedure, Debt collection.

For the reasons stated in the preamble, part 1730 is added to

chapter XVII, title 12 of the Code of Federal Regulations to read as

follows:

PART 1730--DEBT COLLECTION

Subpart A--General

Sec.

1730.1 Authority and scope.

1730.2 Definitions.

1730.3 Collection of debts and referrals to the Department of the

Treasury.

1730.4--1730.19 [Reserved]

Subpart B--Salary Offset

1730.20 Authority and scope.

1730.21 Notice requirements before salary offset where OFHEO is the

creditor agency.

1730.22 Review of OFHEO records related to the debt.

1730.23 Opportunity for a hearing where OFHEO is the creditor

agency.

1730.24 Certification when OFHEO is the creditor agency.

1730.25 Voluntary repayment agreements as alternative to salary

offset where OFHEO is the creditor agency.

1730.26 Special review where OFHEO is creditor agency.

1730.27 Notice of salary offset where OFHEO is the paying agency.

1730.28 Procedures for salary offset where OFHEO is the paying

agency.

1730.29 Coordinating salary offset with other agencies.

1730.30 Interest, penalties, and administrative costs.

1730.31 Refunds.

1730.32 Request from a creditor agency for the services of a

hearing official.

1730.33 Non-waiver of rights by payment.

1730.34-1730.39 [Reserved]

Subpart C--Administrative Offset

1730.40 Authority and scope.

1730.41 Offset prior to completion of procedures.

1730.42 Procedures.

1730.43 Interest.

1730.44 Refunds.

1730.45 Requests for administrative offset to other Federal

agencies.

1730.46 Requests for administrative offset from other Federal

agencies.

1730.47 Administrative offset against amounts payable from Civil

Service Retirement and Disability Fund.

1730.48--1730.49 [Reserved]

Subpart D--Tax Refund Offset

1730.50 Authority and scope.

1730.51 Definitions.

1730.52 Procedures.

Authority: 5 U.S.C. 5514; 26 U.S.C. 6402(d); 31 U.S.C. 3701-

3720A.

Subpart A--General

Sec. 1730.1 Authority and scope.

(a) Authority. The Office of Federal Housing Enterprise Oversight

(OFHEO) issues this part 1730 under the authority of 5 U.S.C. 5514 and

31 U.S.C. 3701-3720A, and in conformity with the FCCS at 4 CFR chapter

II; the regulations on salary offset issued by the Office of Personnel

Management at 5 CFR part 550, subpart K; and the regulations on tax

refund offset issued by the Internal Revenue Service at 26 CFR

301.6402-6.

(b) Scope. (1) This part 1730 applies to debts that are owed to the

Federal Government by Federal employees, other persons, organizations,

or entities that are indebted to OFHEO, and by Federal employees of

OFHEO who are indebted to other agencies, except for those debts listed

in paragraph (b)(2) of this section.

(2) Subparts B and C of this part 1730 do not apply to:

(i) Debts or claims arising under the Internal Revenue Code (26

U.S.C. 1 et seq.) or the tariff laws of the United States;

(ii) Any case to which the Contract Disputes Act (41 U.S.C. 601 et

seq.) applies;

(iii) Any case where collection of a debt is explicitly provided

for or provided by another statute, e.g. travel advances under 5 U.S.C.

5705 and employee training expenses under 5 U.S.C. 4108, or, as

provided for by title 11 of the United States Code, when the claims

involve bankruptcy;

(iv) Any debt based in whole or in part on conduct in violation of

the antitrust laws or involving fraud, the presentation of a false

claim, or misrepresentation on the part of the debtor or any party

having an interest in the claim, unless the Department of

[[Page 34970]]

Justice authorizes OFHEO to handle the collection;

(v) Claims between agencies; or

(vi) A claim that has been outstanding for more than 10 years after

the creditor agency's right to collect the debt first accrued, unless

facts material to the Federal Government's right to collect were not

known and could not reasonably have been known by the officials charged

with the responsibility for discovery and collection of such debts.

(3) Nothing in this part 1730 precludes the compromise, suspension,

or termination of collection actions, where appropriate under the FCCS,

or the use of alternative dispute resolution methods if they are not

inconsistent with applicable law and regulations.

(4) Nothing in this part 1730 precludes an employee from requesting

waiver of an erroneous payment under 5 U.S.C. 5584, 10 U.S.C. 2774, or

32 U.S.C. 716, or from questioning the amount or validity of a debt, in

the manner set forth in this part 1730.

Sec. 1730.2 Definitions.

The following definitions apply to the terms used in this part

1730, unless the term is defined elsewhere in this part 1730.

(a) Administrative offset means an action, pursuant to 31 U.S.C.

3716, in which the Federal Government withholds funds payable to, or

held by the Federal Government for a person, organization, or other

entity in order to collect a debt from that person, organization, or

other entity. Such funds include funds payable by the Federal

Government on behalf of a State Government.

(b) Agency means a department, agency, court, court administrative

office, or instrumentality in the executive, judicial, or legislative

branch of the Federal Government, including government corporations.

(c) Claim or debt (used interchangeably in this part 1730) means

any amount of funds or property that has been determined by an agency

official to be due the Federal Government by a person, organization, or

entity, except another agency. It also means any amount of money,

funds, or property owed by a person to 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. A claim or debt includes:

(1) Funds owed on account of loans made, insured, or guaranteed by

the Federal Government, including any deficiency or any difference

between the price obtained by the Federal Government in the sale of a

property and the amount owed to the Federal Government on a mortgage on

the property;

(2) Expenditures of non-appropriated funds;

(3) Overpayments, including payments disallowed by audits performed

by the Inspector General of the agency administering the program;

(4) Any amount the Federal Government is authorized by statute to

collect for the benefit of any person;

(5) The unpaid share of any non-Federal partner in a program

involving a Federal payment, and a matching or cost-sharing payment by

the non-Federal partner;

(6) Any fines or penalties assessed by an agency; and

(7) Other amounts of money or property owed to the Federal

Government.

(d) Certification means a written statement received by a paying

agency from a creditor agency that request the paying agency to offset

the salary of an employee and specifies that required procedural

protections have been afforded the employee.

(e) Compromise means the settlement or forgiveness of a debt.

(f) Creditor agency means the agency to which the debt is owed,

including a debt collection center when acting in behalf of a creditor

agency in matters pertaining to the collection of a debt.

(g) Debt. See Claim or debt in paragraph (c) of this section.

(h) Debt collection center means the Department of the Treasury or

any other agency or division designated by the Secretary of the

Treasury with authority to collect debts on behalf of creditor agencies

in accordance with 31 U.S.C. 3711(g).

(i) Debtor means the person, organization, or entity owing money to

the Federal Government.

(j) Disposable pay means that part of current basic pay, special

pay, incentive pay, retired pay, or retainer pay (or in the case of an

employee not entitled to basic pay, other authorized pay) remaining

after the deduction of any amount required by law to be withheld (other

than deductions to execute garnishment orders in accordance with 5 CFR

parts 581 and 582). Among the legally required deductions that OFHEO

must apply first to determine disposable pay are levies pursuant to the

Internal Revenue Code (title 26, United States Code) and deductions

described in 5 CFR 581.105 (b) through (f), as follows:

(1) Federal employment taxes;

(2) Amounts withheld for the United States Soldiers' and Airmen's

Home;

(3) Amounts deducted for Medicare;

(4) Fines and forfeiture ordered by a court-martial or by a

commanding officer;

(5) Federal, State, or local income taxes to the extent authorized

or required by law, but no greater than would be the case if the

employee claimed all dependents to which her or she is entitled and

such additional amounts for which the employee presents evidence of a

tax obligation supporting the additional withholding;

(6) Health insurance premiums;

(7) Normal retirement contributions, including employee

contributions to the Thrift Savings Plan; and

(8) Normal life insurance premiums, e.g., Serviceman's Group Life

Insurance and ``Basic Life'' Federal Employee's Group Life Insurance

premiums, not including amounts deducted for supplementary coverage.

(k) Employee means a current employee of OFHEO or other agency,

including a current member of the Armed Forces or a Reserve of the

Armed Forces of the United States.

(l) FCCS means the Federal Claims Collection Standards at 4 CFR

chapter II.

(m) Hearing official means an individual who is responsible for

conducting any hearing with respect to the existence or amount of a

debt claimed and for rendering a decision on the basis of such hearing.

A hearing official may not be under the supervision or control of the

Director of OFHEO when OFHEO is the creditor agency but may be an

administrative law judge.

(n) Notice of Intent means a written notice of a creditor agency to

a debtor that states that the debtor owes a debt to the creditor agency

and apprises the debtor of the applicable procedural rights.

(o) Notice of salary offset means a written notice from the paying

agency to an employee after a certification has been issued by a

creditor agency that informs the employee that salary offset will begin

at the next officially established pay interval.

(p) Paying agency means an agency of the Federal Government that

employs the individual who owes a debt to an agency of the Federal

Government.

(q) Salary offset means an administrative offset to collect a debt

under 5 U.S.C. 5514 by deductions at one or more officially established

pay intervals from the current pay account of an employee without his

or her consent.

(r) Waiver means the cancellation, remission, forgiveness, or non-

recovery of a debt allegedly owed by an employee

[[Page 34971]]

to OFHEO or another agency as permitted or required by 5 U.S.C. 5584 or

8346(b), 10 U.S.C. 2774, 32 U.S.C. 716, or any other law.

Sec. 1730.3 Collection of debts and referrals to the Department of the

Treasury.

(a) Collection activity. The collection of debts directly and by

offset shall be pursued in accordance with this part 1730. This part

1730 incorporates all applicable debt collection provisions of the FCCS

and supplements the FCCS by the prescription of procedures necessary

and appropriate for the operations of OFHEO.

(b) Referral of delinquent debts. (1) OFHEO shall transfer to the

Secretary of the Department of the Treasury any past due, legally

enforceable nontax debt that has been delinquent for a period of 180

days or more so that the Secretary may take appropriate action to

collect the debt or terminate collection action in accordance with 31

U.S.C. 3716, 5 U.S.C. 5514, the FCCS, 5 CFR 550.1108, and 31 CFR part

285.

(2) OFHEO may transfer any past due, legally enforceable nontax

debt that has been delinquent for less than a period of 180 days to a

debt collection center for collection in accordance with 31 U.S.C.

3716, 5 U.S.C. 5514, 5 CFR 550.1108, 31 CFR part 285, and the FCCS.

Secs. 1730.4-1730.19 [Reserved]

Subpart B--Salary Offset

Sec. 1730.20 Authority and scope.

(a) Authority. OFHEO may collect debts owed by employees to the

Federal Government by means of salary offset under the authority of 5

U.S.C. 5514, 5 CFR part 550, subpart K, and this subpart B.

(b) Scope. (1) The procedures set forth in this subpart B apply to

situations where OFHEO is attempting to collect a debt by salary offset

that is owed to it by an individual employed by OFHEO or by another

agency; or where OFHEO employs an individual who owes a debt to another

agency.

(2) The procedures set forth in this subpart B do not apply to:

(i) Any routine intra-agency adjustment of pay that is attributable

to clerical or administrative error or delay in processing pay

documents that have occurred within the four pay periods preceding the

adjustment, or any adjustment to collect a debt amounting to $50 or

less. However, at the time of any such adjustment, or as soon

thereafter as possible, OFHEO or its designated payroll agent shall

provide the employee with a written notice of the nature and the amount

of the adjustment and a point of contact for contesting such

adjustment.

(ii) Any negative adjustment to pay that arises from an employee's

election of coverage or a change in 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, at

the time the such adjustment is made, OFHEO or its payroll agent shall

provide in the employee's earnings statement a clear and concise

statement that informs the employee of the previous overpayment.

Sec. 1730.21 Notice requirements before salary offset where OFHEO is

the creditor agency.

(a) Notice of Intent. Deductions from an employee's salary may not

be made unless OFHEO provides the employee with a Notice of Intent a

minimum of 30 calendar days before the salary offset is initiated.

(b) Contents of Notice of Intent. The Notice of Intent shall advise

the employee of the following:

(1) OFHEO has reviewed the records relating to the claim and has

determined that the employee owes the debt;

(2) OFHEO intends to collect the debt by deductions from the

employee's current disposable pay account;

(3) The amount of the debt and the facts giving rise to the debt;

(4) The frequency and amount of the intended deduction (stated as a

fixed dollar amount or as a percentage of pay not to exceed 15 percent

of disposable pay), and the intention to continue the deductions until

the debt and all accumulated interest are paid in full or otherwise

resolved;

(5) The name, address, and telephone number of the person to whom

the employee may propose a written alternative schedule for voluntary

repayment, in lieu of salary offset. The employee shall include a

justification for the alternative schedule in his or her proposal. If

the terms of the alternative schedule are agreed upon by the employee

and OFHEO, the alternative written schedule shall be signed by both the

employee and OFHEO;

(6) An explanation of OFHEO's policy concerning interest,

penalties, and administrative costs, including a statement that such

assessments must be made unless excused in accordance with the FCCS;

(7) The employee's right to inspect and copy all records of OFHEO

pertaining to his or her debt that are not exempt from disclosure or to

receive copies of such records if he or she is unable personally to

inspect the records as the result of geographical or other constraints;

(8) The name, address, and telephone number of the OFHEO employee

to whom requests for access to records relating to the debt must be

sent;

(9) The employee's right to a hearing conducted by an impartial

hearing official with respect to the existence and amount of the debt

claimed or the repayment schedule i.e., the percentage of disposable

pay to be deducted each pay period, so long as a request is filed by

the employee as prescribed in Sec. 1730.23; the name and address of the

office to which the request for a hearing should be sent; and the name,

address, and telephone number of a person whom the employee may contact

concerning procedures for requesting a hearing;

(10) The filing of a request for a hearing on or before the 15th

calendar day following receipt of the Notice of Intent will stay the

commencement of collection proceedings and a final decision on whether

a hearing will be held (if a hearing is requested) will be issued at

the earliest practical date;

(11) OFHEO shall initiate certification procedures to implement a

salary offset unless the employee files a request for a hearing on or

before the 15th calendar day following receipt of the Notice of Intent;

(12) Any knowingly false or frivolous statement, representations,

or evidence may subject the employee to:

(i) Disciplinary procedures appropriate under 5 U.S.C. chapter

LXXV, 5 CFR part 752, or any other applicable statutes or regulations;

(ii) Penalties under the False Claims Act, 31 U.S.C. 3729-3731, or

under any other applicable statutory authority; or

(iii) Criminal penalties under 18 U.S.C. 286, 287, 1001, and 1002,

or under any other applicable statutory authority;

(13) Any other rights and remedies available to the employee under

statutes or regulations governing the program for which the collection

is being made;

(14) Unless there are applicable contractual or statutory

provisions to the contrary, amounts paid on or deducted from debts that

are later waived or found not to be owed to the Federal Government

shall be promptly refunded to the employee; and

(15) Proceedings with respect to the debt are governed by 5 U.S.C.

5514.

Sec. 1730.22 Review of OFHEO records related to the debt.

(a) Request for review. An employee who desires to inspect or copy

OFHEO records related to a debt owed by the employee to OFHEO must send

a letter

[[Page 34972]]

to the individual designated in the Notice of Intent requesting access

to the relevant records. The letter must be received in the office of

that individual within 15 calendar days after the employee's receipt of

the Notice of Intent.

(b) Review location and time. In response to a timely request

submitted by the employee, the employee shall be notified of the

location and time when the employee may inspect and copy records

related to his or her debt that are not exempt from disclosure. If the

employee is unable personally to inspect such records as the result of

geographical or other constraints, OFHEO shall arrange to send copies

of such records to the employee.

Sec. 1730.23 Opportunity for a hearing where OFHEO is the creditor

agency.

(a) Request for a hearing. (1) Time-period for submission. An

employee who requests a hearing on the existence or amount of the debt

held by OFHEO or on the salary-offset schedule proposed by OFHEO, must

send such request to OFHEO. The request for a hearing must be received

by OFHEO on or before the 15th calendar day following receipt by the

employee of the Notice of Intent.

(2) Failure to submit timely. If the employee files a request for a

hearing after the expiration of the 15th calendar day, OFHEO may accept

the request if the employee can show that the delay was the result of

circumstances beyond his or her control or that he or she failed to

receive actual notice of the filing deadline.

(3) Contents of request. The request for a hearing must be signed

by the employee and must fully identify and explain with reasonable

specificity all the facts, evidence, and witnesses, if any, that the

employee believes support his or her position. The employee must also

specify whether he or she requests an oral hearing. If an oral hearing

is requested, the employee should explain why a hearing by examination

of the documents without an oral hearing would not resolve the matter.

(4) Failure to request a hearing. The failure of an employee to

request a hearing will be considered an admission by the employee that

the debt exits in the amount specified in the Notice of Intent that was

provided to the employee under Sec. 1730.21(b).

(b) Obtaining the services of a hearing official. (1) Debtor is not

OFHEO employee. When the debtor is not an OFHEO employee and OFHEO

cannot provide a prompt and appropriate hearing before an

administrative law judge or other hearing official, OFHEO may request a

hearing official from an agent of the paying agency, as designated in 5

CFR part 581, appendix A, or as otherwise designated by the paying

agency.

(2) Debtor is OFHEO employee. When the debtor is an OFHEO employee,

OFHEO may contact any agent of another agency, as designated in 5 CFR

part 581, appendix A, or as otherwise designated by the agency, to

request a hearing official.

(c) Procedure. (1) Notice of hearing. After the employee requests a

hearing, the hearing official shall notify the employee of the form of

the hearing to be provided. If the hearing will be oral, the notice

shall set forth the date, time, and location of the hearing, which must

occur no more than 30 calendar days after the request is received,

unless the employee requests that the hearing be delayed. If the

hearing will be conducted by an examination of documents, the employee

shall be notified within 30 calendar days that he or she should submit

evidence and arguments in writing to the hearing official.

(2) Oral hearing. (i) An employee who requests an oral hearing

shall be provided an oral hearing if the hearing official determines

that the matter cannot be resolved by an examination of the documents

alone, as for example, when an issue of credibility or veracity is

involved. The oral hearing need not be an adversarial adjudication and

rules of evidence need not apply. Witnesses who testify in an oral

hearing shall do so under oath or affirmation.

(ii) Oral hearings may take the form of, but are not limited to:

(A) Informal conferences with the hearing official in which the

employee and agency representative are given full opportunity to

present evidence, witnesses, and argument;

(B) Informal meetings in which the hearing examiner interviews the

employee; or

(C) Formal written submissions followed by an opportunity for oral

presentation.

(3) Hearing by examination of documents. If the hearing official

determines that an oral hearing is not necessary, he or she shall make

the determination based upon an examination of the documents.

(d) Record. The hearing official shall maintain a summary record of

any hearing conducted under this section.

(e) Decision. (1) The hearing official shall issue a written

opinion stating his or her decision, based upon all evidence and

information developed during the hearing, as soon as practicable after

the hearing, but not later than 60 calendar days after the date on

which the request was received by OFHEO, unless the hearing was delayed

at the request of the employee, in which case the 60-day decision

period shall be extended by the number of days by which the hearing was

postponed.

(2) The decision of the hearing official shall be final and is

considered to be an official certification regarding the existence and

the amount of the debt for purposes of executing salary offset under 5

U.S.C. 5514. If the hearing official determines that a debt may not be

collected by salary offset, but OFHEO finds that the debt is still

valid, OFHEO may seek collection of the debt through other means in

accordance with applicable law and regulations.

(f) Content of decision. The written decision shall include:

(1) A summary of the facts concerning the origin, nature, and

amount of the debt;

(2) The hearing official's findings, analysis, and conclusions; and

(3) The terms of any repayment schedules, if applicable.

(g) Failure to appear. If, in the absence of good cause shown, such

as illness, the employee or the representative of OFHEO fails to

appear, the hearing official shall proceed with the hearing as

scheduled, and make his or decision based upon the oral testimony

presented and the documentation submitted by both parties. At the

request of both parties, the hearing official may schedule a new

hearing date. Both parties shall be given reasonable notice of the time

and place of the new hearing.

Sec. 1730.24 Certification where OFHEO is the creditor agency.

(a) Issuance. OFHEO shall issue a certification in all cases where

the hearing official determines that a debt exists or the employee

admits the existence and amount of the debt, as for example, by failing

to request a hearing.

(b) Contents. The certification must be in writing and state:

(1) That the employee owes the debt;

(2) The amount and basis of the debt;

(3) The date of the Federal Government's right to collect the debt

first accrued;

(4) The date the employee was notified of the debt, the action(s)

taken pursuant to OFHEO's regulations, and the dates such actions were

taken;

(5) If the collection is to be made by lump-sum payment, the amount

and date such payment will be collected;

(6) If the collection is to be made in installments, the amount or

percentage of disposable pay to be collected in each installment and,

if OFHEO wishes, the

[[Page 34973]]

desired commencing date of the first installments, if a date other than

the next officially established pay period; and

(7) A statement that OFHEO's regulation on salary offset has been

approved by the Office of Personnel Management pursuant to 5 CFR part

550, subpart K.

Sec. 1730.25 Voluntary repayment agreements as alternative to salary

offset where OFHEO is the creditor agency.

(a) Proposed repayment schedule. In response to a Notice of Intent,

an employee may propose to repay the debt voluntarily in lieu of salary

offset by submitting a written proposed repayment schedule to OFHEO.

Any proposal under this section must be received by OFHEO within 15

calendar days after receipt of the Notice of Intent.

(b) Notification of decision. In response to a timely proposal by

the employee, OFHEO shall notify the employee whether the employee's

proposed repayment schedule is acceptable. OFHEO has the discretion to

accept, reject, or propose to the employee a modification of the

proposed repayment schedule.

(1) If OFHEO decides that the proposed repayment schedule is

unacceptable, the employee shall have 15 calendar days from the date he

or she received notice of the decision in which to file a request for a

hearing.

(2) If OFHEO decides that the proposed repayment schedule is

acceptable or the employee agrees to a modification proposed by OFHEO,

an agreement shall be put in writing and signed by both the employee

and OFHEO.

Sec. 1730.26 Special review where OFHEO is the creditor agency.

(a) Request for review. (1) An employee subject to salary offset or

a voluntary repayment agreement may, at any time, request a special

review by OFHEO of the amount of the salary offset or voluntary

repayment, based on materially changed circumstances, including, but

not limited to, catastrophic illness, divorce, death, or disability.

(2) The request for special review must include an alternative

proposed offset or payment schedule and a detailed statement, with

supporting documents, that shows why the current salary offset or

payments result in extreme financial hardship to the employee and his

or her spouse and dependents. The detailed statement must indicate:

(i) Income from all sources;

(ii) Assets;

(iii) Liabilities;

(iv) Number of dependents;

(v) Expenses for food, housing, clothing, and transportation;

(vi) Medical expenses; and

(vii) Exceptional expenses, if any.

(b) Evaluation of request. OFHEO shall evaluate the statement and

supporting documents and determine whether the original offset or

repayment schedule imposes extreme financial hardship on the employee.

OFHEO shall notify the employee in writing within 30 calendar days of

such determination, including, if appropriate, a revised offset or

payment schedule. If the special review results in a revised offset or

repayment schedule, OFHEO shall provide a new certification to the

paying agency.

Sec. 1730.27 Notice of salary offset where OFHEO is the paying agency.

(a) Notice. Upon issuance of a proper certification by OFHEO (for

debts owed to OFHEO) or upon receipt of a proper certification from

another creditor agency, OFHEO shall send the employee a written notice

of salary offset.

(b) Content of notice. Such written notice of salary offset shall

advise the employee of the:

(1) Certification that has been issued by OFHEO or received from

another creditor agency;

(2) Amount of the debt and of the deductions to be made; and

(3) Date and pay period when the salary offset will begin.

(c) If OFHEO is not the creditor agency, OFHEO shall provide a copy

of the notice of salary offset to the creditor agency and advise the

creditor agency of the dollar amount to be offset and the pay period

when the offset will begin.

Sec. 1730.28 Procedures for salary offset where OFHEO is the paying

agency.

(a) Generally. OFHEO shall coordinate salary deductions under this

section and shall determine the amount of an employee's disposable pay

and the amount of the salary offset subject to the requirements in this

section. Deductions shall begin the pay period following the issuance

of the certification by OFHEO or the receipt by OFHEO of the

certification from another agency, or as soon thereafter as possible.

(b) Types of collection. (1) Lump-sum payment. If the amount of the

debt is equal to or less than 15 percent of the employee's disposable

pay, such debt ordinarily will be collected in one lump-sum payment.

(2) Installment deductions. Installment deductions will be made

over a period not greater than the anticipated period of employment.

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 pay 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 should normally be sufficient in size

and frequency to liquidate the debt in no more than three years.

Installment payments of less than $50 should be accepted only in the

most unusual circumstances.

(3) Lump-sum deductions from final check. In order to liquidate a

debt, a lump-sum deduction exceeding 15 percent of disposable pay may

be made pursuant to 31 U.S.C. 3716 from any final salary payment due a

former employee, whether the former employee was separated voluntarily

or involuntarily.

(4) Lump-sum deductions from other sources. Whenever an employee

subject to salary offset is separated from OFHEO, and the balance of

the debt cannot be liquidated by offset of the final salary check,

OFHEO may offset any later payments of any kind to the former employee

to collect the balance of the debt pursuant to 31 U.S.C. 3716.

(c) Multiple debts. (1) Where two or more creditor agencies are

seeking salary offset, or where two or more debts are owed to a single

creditor agency, OFHEO may, at his or her discretion, determine whether

one or more debts should be offset simultaneously within the 15 percent

limitation.

(2) In the event that a debt owed OFHEO is certified while an

employee is subject to salary offset to repay another agency, OFHEO

may, at its discretion, determine whether the debt to OFHEO should be

repaid before the debt to the other agency is repaid, repaid

simultaneously with the other debt, or repaid after the debt to the

other agency.

(3) A levy pursuant to the Internal Revenue Code of 1986 shall take

precedence over other deductions under this section, as provided in 5

U.S.C. 5514(d).

Sec. 1730.29 Coordinating salary offset with other agencies.

(a) Responsibility of OFHEO as the creditor agency. (1) OFHEO shall

be responsible for:

(i) Arranging for a hearing upon proper request by a Federal

employee;

(ii) Preparing the Notice of Intent consistent with the

requirements of Sec. 1730.21;

[[Page 34974]]

(iii) Obtaining hearing officials from other agencies pursuant to

Sec. 1730.23(b); and

(iv) Ensuring that each certification of debt is sent to a paying

agency pursuant to Sec. 1730.24(b).

(2) Upon completion of the procedures set forth in Secs. 1730.24-

1730.26, OFHEO shall submit to the employee's paying agency, if

applicable, a certified debt claim and an installment agreement or

other instruction on the payment schedule.

(i) If the employee is in the process of separating from the

Federal Government, OFHEO shall submit its debt claim to the employee's

paying agency for collection by lump-sum deduction from the employee's

final check. The paying agency shall certify the total amount of its

collection and furnish a copy of the certification to OFHEO and to the

employee.

(ii) If the employee is already separated and all payments due from

his or her former paying agency have been paid, OFHEO may, unless

otherwise prohibited, request that money due and payable to the

employee from the Federal Government be administratively offset to

collect the debt.

(iii) When an employee transfers to another paying agency, OFHEO

shall not repeat the procedures described in Secs. 1730.24--1730.26.

Upon receiving notice of the employee's transfer, OFHEO shall review

the debt to ensure that collection is resumed by the new paying agency.

(b) Responsibility of OFHEO as the paying agency. (1) Complete

claim. When OFHEO receives a certified claim from a creditor agency,

the employee shall be given written notice of the certification, the

date salary offset will begin, and the amount of the periodic

deductions. Deductions shall be scheduled to begin at the next

officially established pay interval or as otherwise provided for in the

certification.

(2) Incomplete claim. When OFHEO receives an incomplete

certification of debt from a creditor agency, OFHEO shall return the

claim with notice that procedures under 5 U.S.C. 5514 and 5 CFR

550.1104 must be followed, and that a properly certified claim must be

received before OFHEO will take action to collect the debt from the

employee's current pay account.

(3) Review. OFHEO is not authorized to review the merits of the

creditor agency's determination with respect to the amount or validity

of the debt certified by the creditor agency.

(4) Employees who transfer from one paying agency to another

agency. If, after the creditor agency has submitted the debt claim to

OFHEO, the employee transfers to another agency before the debt is

collected in full, OFHEO must certify the total amount collected on the

debt. One copy of the certification shall be furnished to the employee

and one copy shall be sent to the creditor agency along with notice of

the employee's transfer. If OFHEO is aware that the employee is

entitled to payments from the Civil Service Retirement and Disability

Fund or other similar payments, it must provide written notification to

the agency responsible for making such payments that the debtor owes a

debt (including the amount) and that the requirements set forth herein

and in 5 CFR part 550, subpart k, have been met.

Sec. 1730.30 Interest, penalties, and administrative costs.

Where OFHEO is the creditor agency, OFHEO shall assess interest,

penalties, and administrative costs pursuant to 31 U.S.C. 3717 and the

FCCS.

Sec. 1730.31 Refunds.

(a) Where OFHEO is the creditor agency, OFHEO shall promptly refund

any amount deducted under the authority of 5 U.S.C. 5514 when:

(1) OFHEO receives notice that the debt has been compromised or

otherwise found not to be owing to the Federal Government; or

(2) An administrative or judicial order directs OFHEO to make a

refund.

(b) Unless required by law or contract, refunds under this section

shall not bear interest.

Sec. 1730.32 Request from a creditor agency for the services of a

hearing official.

(a) OFHEO may provide qualified personnel to serve as hearing

officials upon request of a creditor agency when--

(1) The debtor is employed by OFHEO and the creditor agency cannot

provide a prompt and appropriate hearing before a hearing official

furnished pursuant to another lawful arrangement; or

(2) The debtor is employed by the creditor agency and that agency

cannot arrange for a hearing official.

(b) Services provided by OFHEO to creditor agencies under this

section shall be provided on a fully reimbursable basis pursuant to 31

U.S.C. 1535.

Sec. 1730.33 Non-waiver of rights by payments.

A debtor's payment, whether voluntary or involuntary, of all or any

portion of a debt being collected pursuant to this subpart B shall not

be construed as a waiver of any rights that the debtor may have under

any statute, regulation, or contract, except as otherwise provided by

law or contract.

Secs. 1730.34-1730.39 [Reserved]

Subpart C--Administrative Offset

Sec. 1730.40 Authority and scope.

OFHEO may collect a debt owed to the Federal Government from a

person, organization, or other entity by administrative offset,

pursuant to 31 U.S.C. 3716, where:

(a) The debt is certain in amount;

(b) Administrative offset is feasible, desirable, and not otherwise

prohibited;

(c) The applicable statute of limitations has not expired; and

(d) Administrative offset is in the best interest of the Federal

Government.

Sec. 1730.41 Administrative offset prior to completion of procedures.

Prior to the completion of the procedures described in

Sec. 1730.42, OFHEO may effect administrative offset if failure to

offset would substantially prejudice its ability to collect the debt,

and if the time before the payment is to be made does not reasonably

permit completion of the procedures described in Sec. 1730.42. Such

prior administrative offset shall be followed promptly by the

completion of the procedures described in Sec. 1730.42.

Sec. 1730.42 Procedures.

Unless the procedures described in Sec. 1730.41 are used, prior to

collecting any debt by administrative offset or referring such claim to

another agency for collection through administrative offset, OFHEO

shall provide the debtor with the following:

(a) Written notification of the nature and amount of the debt, the

intention of OFHEO to collect the debt through administrative offset,

and a statement of the rights of the debtor under this section;

(b) An opportunity to inspect and copy the records of OFHEO related

to the debt that are not exempt from disclosure;

(c) An opportunity for review within OFHEO of the determination of

indebtedness. Any request for review by the debtor shall be in writing

and shall be submitted to OFHEO within 30 calendar days of the date of

the notice of the offset. OFHEO may waive the time limits for

requesting review for good cause shown by the debtor. OFHEO shall

provide the debtor with a reasonable opportunity for an oral hearing

when:

(1) An applicable statute authorizes or requires OFHEO to consider

waiver of the indebtedness involved, the debtor requests waiver of the

indebtedness, and

[[Page 34975]]

the waiver determination turns on an issue of credibility or veracity;

or

(2) The debtor requests reconsideration of the debt and OFHEO

determines that the question of the indebtedness cannot be resolved by

review of the documentary evidence, as for example, when the validity

of the debt turns on an issue of credibility or veracity. Unless

otherwise required by law, an oral hearing under this subpart C is not

required to be a formal evidentiary hearing, although OFHEO shall

document all significant matters discussed at the hearing. In those

cases where an oral hearing is not required by this subpart C, OFHEO

shall make its determination on the request for waiver or

reconsideration based upon a review of the written record; and

(d) An opportunity to enter into a written agreement for the

repayment of the amount of the claim at the discretion of OFHEO.

Sec. 1730.43 Interest.

OFHEO shall assess interest, penalties, and administrative costs on

debts owed to the Federal Government, in accordance with 31 U.S.C. 3717

and the FCCS. OFHEO may also assess interest and related charges on

debts that are not subject to 31 U.S.C. 3717 and the FCCS to the extent

authorized under the common law or other applicable statutory

authority.

Sec. 1730.44 Refunds.

OFHEO shall refund promptly those amounts recovered by

administrative offset but later found not to be owed to the Federal

Government.

Sec. 1730.45 Requests for administrative offset to other Federal

agencies.

(a) OFHEO may request that a debt owed to OFHEO be collected by

administrative offset against funds due and payable to a debtor by

another agency.

(b) In requesting administrative offset, OFHEO, as creditor, shall

certify in writing to the agency holding funds of the debtor:

(1) That the debtor owes the debt;

(2) The amount and basis of the debt; and

(3) That OFHEO has complied with the requirements of its own

administrative offset regulations and the applicable provisions of the

FCCS with respect to providing the debtor with due process.

Sec. 1730.46 Requests for administrative offset from other Federal

agencies.

(a) Any agency may request that funds due and payable to a debtor

by OFHEO be administratively offset in order to collect a debt owed to

such agency by the debtor.

(b) OFHEO shall initiate the requested administrative offset only

upon:

(1) Receipt of written certification from the creditor agency that:

(i) The debtor owes the debt, including the amount and basis of the

debt;

(ii) The agency has prescribed regulations for the exercise of

administrative offset; and

(iii) The agency has complied with its own administrative offset

regulations and with the applicable provisions of the FCCS, including

providing any required hearing or review.

(2) A determination by OFHEO that collection by administrative

offset against funds payable by OFHEO would be in the best interest of

the Federal Government as determined by the facts and circumstances of

the particular case and that such administrative offset would not

otherwise be contrary to law.

Sec. 1730.47 Administrative offset against amounts payable from Civil

Service Retirement and Disability Fund.

(a) Request for administrative offset. Unless otherwise prohibited

by law, OFHEO may request that monies that are due and payable to a

debtor from the Civil Service Retirement and Disability Fund (Fund) be

offset administratively in reasonable amounts in order to collect in

one full payment or in a minimal number of payments debt owed to OFHEO

by the debtor. Such requests shall be made to the appropriate officials

of the Office of Personnel Management in accordance with such

regulations as may be prescribed by the Director of the Office of

Personnel Management.

(b) Contents of certification. When making a request for

administrative offset under paragraph (a) of this section, OFHEO shall

include a written certification that:

(1) The debtor owes OFHEO a debt, including the amount of the debt;

(2) OFHEO has complied with the applicable statutes, regulations,

and procedures of the Office of Personnel Management; and

(3) OFHEO has complied with the requirements of the FCCS, including

any required hearing or review.

(c) If OFHEO decides to request administrative offset under

paragraph (a) of this section, it shall make the request as soon as

practicable after completion of the applicable procedures. This will

satisfy any requirement that administrative offset be initiated prior

to the expiration of the applicable statute of limitations. At such

time as the debtor makes a claim for payments from the Fund, if at

least one year has elapsed since the administrative offset request was

originally made, the debtor shall be permitted to offer a satisfactory

repayment plan in lieu of administrative offset if he or she

establishes that changed financial circumstances would render the

administrative offset unjust.

(d) If OFHEO collects part or all of the debt by other means before

deductions are made or completed pursuant to paragraph (a) of this

section, OFHEO shall act promptly to modify or terminate its request

for administrative offset under paragraph (a) of this section.

Secs. 1730.48-1730.49 [Reserved]

Subpart D--Tax Refund Offset

Sec. 1730.50 Authority and scope.

The provisions of 26 U.S.C. 6402(d) and 31 U.S.C. 3720A authorize

the Secretary of the Treasury to offset a delinquent debt owed the

Federal Government from the tax refund due a taxpayer when other

collection efforts have failed to recover the amount due.

Sec. 1730.51 Definitions.

(a)(1) Debt means money owed by an individual, organization, or

entity from sources which include loans insured or guaranteed by the

Federal Government and all other amounts due the Federal Government

from fees, leases, services, overpayments, civil and criminal

penalties, damages, interest, fines, administrative costs, and all

other similar sources.

(2) A debt becomes eligible for tax refund offset procedures if:

(i) It cannot currently be collected pursuant to the salary offset

procedures of 5 U.S.C. 5514(a)(1);

(ii) The debt is ineligible for administrative offset under 31

U.S.C. 3716(a) by reason of 31 U.S.C. 3716(c)(2), or it cannot be

collected currently by administrative offset under 31 U.S.C. 3716(a);

and

(iii) The requirements of this section are otherwise satisfied.

(3) All judgment debts are past due for purposes of this subpart D.

Judgment debts remain past due until paid in full.

(b) Dispute means a written statement supported by documentation or

other evidence that all or part of an alleged debt is not past due or

legally enforceable, that the amount is not the amount currently owed,

that the outstanding debt has been satisfied, or in the case of a debt

reduced to judgment, that the judgement has been satisfied or stayed.

(c) Notice means the information sent to the debtor pursuant to

Sec. 1730.53. The

[[Page 34976]]

date of the notice is that date shown on the notice letter as its date

of issuance.

Sec. 1730.52 Procedures.

(a) Referral to the Department of the Treasury. (1) OFHEO may refer

any past due, legally enforceable nonjudgment debt of an individual,

organization, or entity to the Department of the Treasury for tax

refund offset if OFHEO's or the referring agency's rights of action

accrued more than three months but less than 10 years before the offset

is made.

(2) Debts reduced to judgment may be referred at any time.

(3) Debts in amounts lower than $25 are not subject to referral.

(4) In the event that more than one debt is owed, the tax refund

offset procedures shall be applied in the order in which the debts

became past due.

(5) OFHEO shall notify the Department of the Treasury of any change

in the amount due promptly after receipt of payment or notice of other

reductions.

(b) Notice. OFHEO shall provide the debtor with written notice of

its intent to offset before initiating the offset. Notice shall be

mailed to the debtor at the current address of the debtor, as

determined from information obtained from the Internal Revenue Service

pursuant to 26 U.S.C. 6103(m)(2), (4), (5) or maintained by OFHEO. The

notice sent to the debtor shall state the amount of the debt and inform

the debtor that:

(1) The debt is past due;

(2) OFHEO intends to refer the debt to the Department of the

Treasury for offset from tax refunds that may be due to the taxpayer;

(3) OFHEO intends to provide information concerning the delinquent

debt exceeding $100 to a consumer reporting bureau unless such debt has

already been disclosed; and

(4) Before the debt is reported to a consumer reporting agency, if

applicable, and referred to the Department of the Treasury for offset

from tax refunds, the debtor has 65 calendar days from the date of

notice to request a review under paragraph (d).

(c) Report to consumer reporting agency. If the debtor neither pays

the amount due nor presents evidence that the amount is not past due or

is satisfied or stayed, OFHEO will report the debt to a consumer

reporting agency at the end of the notice period, if applicable, and

refer the debt to the Department of the Treasury for offset from the

taxpayer's Federal tax refund. OFHEO shall certify to the Department of

the Treasury that reasonable efforts have been made by OFHEO to obtain

payment of such debt.

(d) Request for review. A debtor may request a review by OFHEO if

he or she believes that all or part of the debt is not past due or is

not legally enforceable, or in the case of a judgment debt, that the

debt has been stayed or the amount satisfied, as follows:

(1) The debtor must send a written request for review to OFHEO at

the address provided in the notice.

(2) The request must state the amount disputed and reasons why the

debtor believes that the debt is not past due, is not legally

enforceable, has been satisfied, or if a judgment debt, has been

satisfied or stayed.

(3) The request must include any documents that the debtor wishes

to be considered or state that additional information will be submitted

within the time permitted.

(4) If the debtor wishes to inspect records establishing the nature

and amount of the debt, the debtor must make a written request to OFHEO

for an opportunity for such an inspection. The office holding the

relevant records not exempt from disclosure shall make them available

for inspection during normal business hours within one week from the

date of receipt of the request.

(5) The request for review and any additional information submitted

pursuant to the request must be received by OFHEO at the address stated

in the notice within 65 calendar days of the date of issuance of the

notice.

(6) In reaching its decision, OFHEO shall review the dispute and

shall consider its records and any documentation and arguments

submitted by the debtor. OFHEO shall send a written notice of its

decision to the debtor. There is no administrative appeal of this

decision.

(7) If the evidence presented by the debtor is considered by a non-

OFHEO agent or other entities or persons acting on behalf of OFHEO, the

debtor shall be accorded at least 30 calendar days from the date the

agent or other entity or person determines that all or part of the debt

is past due and legally enforceable to request review by OFHEO of any

unresolved dispute.

(8) Any debt that previously has been reviewed pursuant to this

section or any other section of this part, or that has been reduced to

a judgment, may not be disputed except on the grounds of payments made

or events occurring subsequent to the previous review or judgment.

Dated: June 22, 1999.

Mark A. Kinsey,

Acting Director, Office of Federal Housing Enterprise Oversight.

[FR Doc. 99-16369 Filed 6-29-99; 8:45 am]

BILLING CODE 4220-01-U