PART 814—SALARY OFFSET PROCEDURES Authority: 5 U.S.C. 5514; 5 CFR part 550, subpart K; sec. 8(1) of E.O. 11609, 36 FR 13747, 3 CFR, 1971-1975 Comp., p. 586. Source: 787 FR 41586, July 13, 2022, unless otherwise noted. § 814.1 Purpose and Scope. (a) Purpose. (b) Scope. (2) The procedures contained in this part do not apply to— (i) Any case where an employee consents to collection through deduction(s) from the employee's Agency pay account; (ii) Debts arising under the Internal Revenue Code (26 U.S.C. 1 et seq. (iii) Debts arising under the tariff laws of the United States; (iv) Any case where collection of a debt by salary offset is explicitly provided for or prohibited by another statute ( e.g., (v) Any other debt excluded by the Federal Claims Collection Standards (FCCS), 31 CFR parts 900 through 904. (3) This part does not preclude a CSOSA 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 in any way questioning the amount or validity of a debt, in the manner prescribed by the Director. Similarly, this part does not preclude a CSOSA employee from requesting a waiver of the collection of a debt under any other applicable statutory authority. (4) Nothing in this part precludes the compromise of the debt, or the suspension or termination of collection actions, in accordance with 31 U.S.C. 3711 or other applicable statutory authority. § 814.2 Definitions. Administrative offset Agency Creditor agency Day Debt Debt collection Center Debtor Delinquent debt Director Disposable Pay Employee Evidence of Service FCCS Hearing Hearing official Paying agency Salary Offset Waiver § 814.3 Entitlement to notice, hearing, written responses and decisions. (a) Except as provided in § 814.4, each employee from whom CSOSA proposes to collect a debt using salary offset under this part is entitled to receive from CSOSA: (1) A written notice as described in § 814.5; and (2) An opportunity to petition for a hearing and, if a hearing is given, to receive a written decision from the official within 60 days of holding the hearing on the following issues: (i) The determination concerning the existence or amount of the debt; and (ii) The repayment schedule, if it was not established by written agreement between the employee and CSOSA. (b) [Reserved] § 814.4 Exception to entitlement to notice, hearing, written responses, and final decisions. For internal collections, the provisions of § 814.3 do not apply to: (a) Any adjustment to pay 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; (b) A routine intra-agency adjustment of pay 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 such adjustment, or as soon thereafter as practical, the individual is provided written notice of the nature and the amount of the adjustment and point of contact for contesting such adjustment; or (c) Any adjustment to collect a debt amounting to $50 or less, if, at the time of such adjustment, or as soon thereafter as practical, the individual is provided written notice of the nature and the amount of the adjustment and a point of contact for contesting such adjustment. § 814.5 Notification before deductions begin. (a) CSOSA and/or a Debt Collection Center will provide employees notification before deductions begin. Except as provided in § 814.4, agency pay deductions under the authority of 5 U.S.C. 5514 must not be made unless the Director (or authorized designee) provides the employee a written notice at least 30 days before any deduction begins. (For debts outstanding more than 10 years on or before June 11, 2009, see also 31 CFR 285.7(d) for additional notification requirements.) The written notice must state at a minimum: (1) CSOSA's determination that a debt is owed, including the origin, nature, and amount of that debt; (2) CSOSA's intention to collect the debt by means of deduction from the employee's current disposable pay account; (3) 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 except as provided in § 814.10) and the intention to continue the deductions until the debt is paid in full or otherwise resolved; (4) An explanation of CSOSA's policy concerning interest, penalties, and administrative costs, including a statement that such assessments must be made unless excused in accordance with the FCCS as defined in § 814.2; (5) The employee's right to inspect and copy Government records relating to the debt or, if employee or his or her representative cannot personally inspect the records, to request and receive a copy of such records; (6) If not previously provided, the opportunity (under terms agreeable to CSOSA) to establish a schedule for the voluntary repayment of the debt or to enter into a written agreement to establish a schedule for repayment of the debt in lieu of offset. The agreement must be in writing, signed by both the employee and CSOSA; and documented in CSOSA's files; (7) The employee's right to a hearing conducted by an official arranged by CSOSA (an administrative law judge, or alternatively, a hearing official not under the control of the Director of CSOSA) if a petition is filed as prescribed in § 814.6; (8) The method and time period for petitioning for a hearing; (9) The name and address of the office to which the petition should be set. (10) That the timely and complete filing of a petition for hearing will stay the commencement of collection proceedings; (11) That a final decision on the hearing (if one is requested) will be issued at the earliest practical date, but not later than 60 days after the filing of the petition requesting the hearing unless the employee requests and the hearing official grants a delay in the proceedings; (12) That any knowingly false or frivolous statements, representations, or evidence may subject the employee to: (i) Disciplinary procedures appropriate under 5 U.S.C. chapter 75, 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 any other applicable statutory authority; or (iii) Criminal penalties under 18 U.S.C. 286, 287, 1001, and 1002 or 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, that amounts paid on or deducted for the debt which are later waived or found not owed to the United States will be promptly refunded to the employee; and (15) Proceedings with respect to such debt are governed by 5 U.S.C. 5514. (b) The Director, as defined in § 814.2, will retain evidence of service indicating the date of mailing of the notice. § 814.6 Petitions for hearing. (a) To request a hearing concerning the existence or amount of the debt or the offset schedule established by the Agency, the employee must send a written petition to the office designated in the notice of intent to offset, see § 814.5(a)(9), within 15 days of receipt of the deduction notice, stating why the employee believes the determination of the Agency concerning the existence or amount of the debt is in error or requesting changes to the proposed deduction frequency and amount. (b) The petition must: (1) Be signed by the employee; (2) Fully identify and explain with reasonable specificity all the facts, evidence, and witnesses, if any, that the employee believes support the employee's position; and (3) Specify whether an oral or paper (documentary) hearing is requested. If an oral hearing is requested, the request should explain why the matter cannot be resolved by review of the documentary evidence alone. § 814.7 Petitions for hearing made after time expires. (a) If the petition for hearing is filed after the 15-day period provided for in § 814.6, the Director may grant the request if the employee can establish that the delay was the result of circumstances beyond the employee's control, or that the employee failed to receive actual notice of the filing deadline. (b) An employee waives the right to a hearing, and will have his or her disposable pay offset in accordance with the offset schedule established by the Agency, if the employee: (1) Fails to file a timely request for a hearing, unless such failure is excused; or (2) Fails to appear at an oral hearing, of which the employee was notified, unless the hearing official determines that the failure to appear was due to circumstances beyond the employee's control. (c) The following procedure is instituted upon a failure to appear at a hearing. (1) In the absence of good cause shown ( e.g., (2) If the representative of the creditor agency fails to appear, the hearing official shall proceed with the hearing as scheduled and make a determination based upon oral testimony presented and the documentary evidence submitted by both parties. With the agreement of both parties, the hearing official shall schedule a new hearing date, and both parties shall be given reasonable notice of the time and place of the new hearing. § 814.8 Representation at the hearing. (a) The creditor agency may be represented by legal counsel. (b) The employee may be self-represented or may be represented by an individual of the employee's choosing, at the employee's expense. § 814.9 Procedures for hearing and final decisions. (a) Form of hearings General. (2) Oral hearing. e.g., e.g., (i) Informal conferences with the hearing official in which the employee and agency representative will be given full opportunity to present evidence, witnesses, and arguments; (ii) Informal meetings in which the hearing official interviews the employee; or (iii) Formal written submissions with an opportunity for oral presentations. (3) Paper (documentary) hearing. (4) Record. (b) Written decision Date of decision. (2) Content of decision. (i) A statement of the facts presented to support the origin, nature, and amount of the debt; (ii) The hearing official's findings, analysis, and conclusions, including a determination whether the employee's petition for hearing was baseless and resulted from an intent to delay creditor agency collection activity; and (iii) The terms of any repayment schedule, if applicable. § 814.10 Method and source of deductions. (a) Types of deductions. (b) Limitation on amount of deduction. (c) Duration of deductions Lump sum. (2) Inability to pay lump sum. (d) When deductions may begin. (2) If the employee files a timely petition for hearing as provided in § 814.6, deductions will begin after the hearing official has provided the employee with a hearing and a final written decision has been rendered in favor of the Agency. (e) Liquidation from final check. e.g., (f) Recovery from other payments due a separated employee. e.g., § 814.11 Interest, penalties, and administrative costs. Debts owed to the Agency shall be assessed interest, penalties and administrative costs in accordance with FCCS, 31 CFR 901.9. § 814.12 Non-waiver of rights by payments. An employee's involuntary payment, of all or any portion of a debt being collected under 5 U.S.C. 5514 must not be construed as a waiver of any rights which the employee may have under 5 U.S.C. 5514 or any other provision of contract or law, unless there are statutory or contractual provisions to the contrary. § 814.13 Refunds. (a) CSOSA will promptly refund amounts paid or deducted under this subpart to the appropriate party, when: (1) A debt is waived or otherwise found not owing to the United States (unless expressly prohibited by statute or regulation); or (2) The employee's paying agency is directed by an administrative or judicial order to refund amounts deducted from his or her current pay. (b) Refunds do not bear interest unless required or permitted by law or contract.