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Subpart A-Settlement of Small or
AUTHORITY: Sec. 1, 58 Stat. 836; 12 U.S.C. 1150.
SOURCE: 10 FR 807, Jan. 23, 1945, unless otherwise noted. Redesignated at 13 FR 6903, Nov. 24, 1948.
3.21 Debt collection standards. 3.22 Definitions. 3.23 Collection by administrative offset. 3.24 Coordinating administrative offset
with other Federal agencies. 3.25 Notice requirements before offset. 3.26 Exceptions to notice requirements. 3.27 Inspection of USDA records related to
the debt. 3.28 Written agreements to repay debt as
alternative to administrative offset. 3.29 Hearings and reviews. 3.30 Stay of offset. 3.31 Agency procedures. 3.32 Offset against amounts payable from
Civil Service retirement and disability
fund. 3.33 Offset of debtor's judgment against
the United States. 3.34 Interest, penalties and administrative
costs. 3.35 Disclosure to credit reporting
agency. 3.36 Use of collection agencies.
8 3.1 Purposes of the act and regulations.
The principal purposes of the act and of the regulations in this part are to provide means of: (a) Settling, by compromise, adjustment or cancellation relatively small debts long past due and owing to the Government arising from loans or payments made under farm programs administered by the Department; (b) recovering by the Department of substantial sums which are found uncollectible when the indebtednesses are treated as full obligations, and which otherwise would probably never be collected; (c) clearing the accounts of balances so small as not to warrant continued efforts of collection; and (d) the clearing of the accounts of the records of indebtedness made uncollectible by reason of the death or disappearance of the debtors. The existence of the act will neither serve as grounds for any relax. ation in the general collection policy of the Department nor should it serve as grounds for any lessening of the efforts of farmers to pay their indebtedness.
Subpart C—Salary Offset 3.51 Scope. 3.52 Definitions. 3.53 Coordinating offset with another Fed.
eral agency. 3.54 Determination of indebtedness. 3.55 Notice requirements before offset. 3.56 Request for a hearing. 3.57 Result if employee fails to meet dead
lines. 3.58 Hearings. 3.59 Written decision following a hearing. 3.60 Review of Departmental records relat
ed to the debt. 3.61 Written agreement to repay debt as al
ternative to salary offset.
8 3.2 Definitions.
(a) Department means Department of Agriculture.
(b) Indebtedness with respect to any person, means a debt to the Government under each of the acts and programs listed in $ 3.10.
(c) Compromise means final liquidation of the indebtedness through the immediate payment of a portion thereof, and acceptance by the United States of such payment in full satisfaction of the indebtedness.
(d) Adjustment means the scaling down of the amount of the indebtedness including interest, conditioned upon the payment of the adjusted amount at some specified future time or times; such adjustment is not to be considered as effective as a settlement under this act until the provisions of the adjustment arrangement have been carried out.
(e) Cancellation means the complete discharge, without payment, of the indebtedness and the debtor. (10 FR 807, Jan. 23, 1945, as amended at 11 FR 11984, Oct. 15, 1946. Redesignated at 13 FR 6903, Nov. 24, 1948; 55 FR 38662, Sept. 20, 1990)
(3) That the debtor has acted in good faith in an effort to meet his obligation; and
(4) That the principal amount of said indebtedness is not in excess of $1,000.
(b) Indebtedness may also be canceled without application when any one of the following circumstances is found:
(1) The amount of said indebtedness, including interest, is less than $10; such efforts of collection have been made as are warranted under the cir. cumstances, and the cost of collection or of continued maintenance of accounts is deemed greater than the amount of the indebtedness;
(2) The debtor is deceased and there is no reasonable prospect of recovering from his estate;
(3) The debtor's whereabouts has remained unknown for two years and there is no reasonable prospect of obtaining collection; heads of agencies designated in § 3.5 will prescribe procedures which will assure that cancellations on this ground will be made only after a diligent effort has been made to locate the debtor, including such contact with other agencies of the Department or otherwise as the amount of the indebtedness and the circumstances warrant;
(4) The debtor has been discharged of the indebtedness in any proceeding under “An act to establish a uniform system of bankruptcy throughout the United States."
(5) It is impossible or impracticable for legal or other reasons to obtain the debtor's application but all of the findings required by paragraph (a) of this section are made.
$ 3.3 Settlement of indebtedness.
(a) Indebtedness will be compromised, adjusted, or canceled, upon applicability by the debtor except in those cases where it is found that it is legally impossible for the debtor to make application, and upon the making of all the following findings:
(1) That said indebtedness has been due and payable for five years or more;
(2) That the debtor is unable to pay said indebtedness in full and has no reasonable prospect of being able to do so; officers of the Department shall not make such findings on the basis of mere unwillingness to pay on the part of the debtor, or mere financial disadvantage to him, but should find that the settlement is the most advantageous arrangement possible from the standpoint of the Government under the findings prescribed in this part. In no event shall cancellation be made unless, in addition to the foregoing requirements, there is an advantage in removing the indebtedness from the accounts.
(10 FR 807, Jan. 23, 1945, as amended at 12 FR 441, Jan. 22, 1947. Redesignated at 13 FR 6903, Nov. 24, 1948, and amended at 21 FR 3213, May 16, 1956)
8 3.4 Investigations and findings.
The heads of agencies designated in $ 3.5 shall prescribe procedures for the conduct of investigations to determine the facts incident to the settlement of any indebtedness. These procedures should include, among other things, provisions for consultations with local authorities, businessmen, or local rep
resentatives of other Government Chiefs, Production Loan Operations, agencies, or for obtaining the recom- in State offices of that administration. mendations of committees or other
(21 FR 3213, May 16, 1956, as amended at 55 groups or persons designated by each
FR 18591, May 3, 1990) agency for assistance in its regular program, or otherwise. The file relat.
8 3.6 Forms and records. ing to each debtor shall contain the formal findings required by $ 3.3, to
The Office of Management and gether with such evidence as has been
Budget may prescribe or approve obtained in support of such findings.
forms for applications for settlement In order to effect uniformity in set
of indebtedness under this part; and tlements, agency procedures should
shall require each agency to establish also provide that, where it appears
records to insure the immediate avail. from the application of the debtor or
ability of necessary information of opfrom investigation that the debtor is
erations under this part. Each agency otherwise indebted to the United
shall furnish to the Office of ManageStates, to the extent practicable con
ment and Budget a report of operations sultation should be had (other than in
under this part quarterly, or for such cases under $ 3.3(b) (1) and (4) with other periods as the Director of Fiany other creditor agencies, to ascer
nance may designate. tain pertinent information as to the
(21 FR 3213, May 16, 1956, as amended at 55 status of such other obligation or obli- FR 38662, Sent. 20, 1990) gation. Such information shall be considered in connection with the set- 8 3.8 Penalties. tlement and for inclusion in the find.
The act prescribes the punishment ings.
by a fine of not more than $1,000 or The head of each agency shall pro
imprisonment for not more than one vide for review of proposed indebtedness settlements within his agency by
year, or both, upon conviction, for
anyone making any material represen. officers or employees designated for
tation, knowing it to be false, for the that purpose under such conditions as
purpose of influencing in any way the he shall determine to be adequate to
action of the Secretary or of any insure the protection of the interests of the United States.
person acting under his authority in
connection with any compromise, ad8 3.5 Delegations of authority.
justment, or cancellation of indebted
ness provided for in the act. The act The heads of any administration or
also prohibits the acceptance by any other agency having jurisdiction over
officer, employee, or other person to any of the acts or programs listed in
whom is delegated any power or func$ 3.10 (including those of Federal Crop
tion under the act, of any fee, commisInsurance Corporation) are hereby au
sion, gift, or other cor.sideration, dithorized, within their respective juris
rectly or indirectly, for or in connecdictions, to exercise any or all of the
tion with any transaction or business functions prescribed by this part. The head of each of such agencies may del
relating to the compromise, adjust
ment, or cancellation of indebtedness egate and authorize the redelegation
under the act. of any of the functions vested in him by this part: Provided, That the deter
8 3.9 Indebtedness referred to the Compmination of any settlement shall not
troller General or the Attorney Gener. be delegated beyond the head of the
al. highest field office having jurisdiction, except that in the case of the Agricul
No settlement shall be effected tural Stabilization and Conservation
under this part if the indebtedness is State Offices, such authority may also
pending before the Comptroller Genbe delegated to the State Administra
eral for compromise, or the Attorney tive Officers and except that in the
General for collection. case of the Farmers Home Administra
(10 FR 807, Jan. 23, 1945. Redesignated at tion, such authority may also be dele- 13 FR 6903, Nov. 24, 1948, and amended at gated to Assistant State Directors and 55 FR 38662, Sept. 20, 1990)
8 3.10 Scope of the act.
The authorities prescribed in this part are applicable to indebtedness arising from loans or payments made or credit extended pursuant to the following acts and programs:
1. Act of July 1, 1918 (40 Stat. 635), Loans for seed.
2. Act of March 3, 1921 (41 Stat. 1347), Loans for seed.
3. Act of March 20, 1922 (42 Stat. 467), Loans for seed.
4. Act of April 26, 1924 (43 Stat. 110), Loans for seed and feed.
5. Act of February 25, 1927 (44 Stat. 1245), Loans for seed, feed and fertilizer.
6. Act of February 28, 1927 (44 Stat. 1251), Hurricane damage loans.
7. Act of February 25, 1929 (45 Stat. 1306), as amended May 17, 1929 (46 Stat. 3), Loans for seed, feed and fertilizer and to vegetable and fruit growers.
8. Act of March 3, 1930 (46 Stat. 78-79), as amended April 24, 1930 (46 Stat. 254). Loans for seed, feed, fertilizer, fuel and oil.
9. Act of December 20, 1930 (46 Stat. 1032), as amended February 14, 1931 (46 Stat. 1160). Loans for seed, feed, fertilizer, fuel and oil and crop production, and for assisting in forming local agricultural credit corporations, livestock loan companies, or like organizations.
10. Act of February 23, 1931 (46 Stat. 1276), Loans for seed, feed, fertilizer, fuel and oil.
11. Act of January 22, 1932 (47 Stat. 5), Loans for crop production.
12. Act of March 3, 1932 (47 Stat. 60), Loans for agricultural credit corporations, livestock loan companies, or like organizations.
13. Act of February 4, 1933 (47 Stat. 795), Loans for crop production and harvesting.
14. Act of February 23, 1934 (48 Stat. 354), Loans for crop production and harvesting.
15. Act of June 19, 1934 (48 Stat. 1056), Loans for emergency relief and for seed, feed, freight, summer fallowing and similar purposes.
16. Act of February 20, 1935 (49 Stat. 28), Loans for crop production and harvesting.
17. Act of March 21, 1935 (49 Stat. 50), ap. propriation to effectuate Act of February 20, 1935.
18. Act of April 8, 1935 (49 Stat. 115), E. O. 7305, Loans for crop production and harvesting.
19. Act of January 29, 1937 (50 Stat. 5), Loans for crop production and harvesting.
20. Act of February 4, 1938 (52 Stat. 27), Loans for crop production and harvesting.
21. Agricultural Adjustment Act (of 1933), as heretofore amended.
22. Bankhead Cotton Act of April 21, 1934, as heretofore amended, on account of the
several cotton tax-exemption certificate pools.
23. Jones-Connally Cattle Act of April 7, 1934, as heretofore amended.
24. Emergency Appropriation Act, fiscal year 1935, approved June 19, 1934 (48 Stat. 1056), as heretofore amended, (amendment to Agricultural Adjustment Act of 1933, relating to cotton option contracts.)
25. Kerr Tobacco Act of June 28, 1934 and Public Resolution No. 76 of March 14, 1936, as heretofore amended.
26. Section 32 of the Act of August 24, 1935 and related legislation, as heretofore amended.
27. Supplemental Appropriation Act, fiscal year 1936, as heretofore amended, (rental and benefit payments and cotton price adjustment payments).
28. Sections 7 to 17 of the Soil Conservation and Domestic Allotment Act, as heretofore amended.
29. Sugar Act of 1937, as heretofore amended.
30. Sections 303 and 381(a) of the Agricul. tural Adjustment Act of 1938 and related or subsequent legislation, as heretofore amended, authorizing parity or adjustment payments.
31. Title IV and Title V of the Agricultural Adjustment Act of 1938 and related legislation, as heretofore amended, (Cotton Pool Participation Trust Certificates (Title IV), and crop insurance (Title V)).
32. Any other Act of Congress heretofore enacted authorizing payments to farmers under programs administered through the Agricultural Adjustment Agency.
33. Act of April 8, 1935 (49 Stat. 115), Loan for rural rehabilitation and relief.
34. Act of June 22, 1936 (49 Stat. 1608), Loan for rural rehabilitation and relief.
35. Act of February 9, 1937 (50 Stat. 8), Loans for rural rehabilitation and relief.
36. Act of June 29, 1937 (50 Stat. 352), Loans for rural rehabilitation and relief.
37. The Bankhead-Jones Farm Tenant Act (50 Stat. 522 et seq.).
38. The Water Facilities Act of August 28, 1937 (50 Stat. 869 et seq.).
39. Act of March 2, 1938 (52 Stat. 83, Pub. Res. 80), Loans for rural rehabilitation and relief.
40. Act of June 21, 1938 (52 Stat. 809), Loans for rural rehabilitation and relief.
41. Act of June 30, 1939 (53 Stat. 927), Loans for rural rehabilitation and relief.
42. Act of June 26, 1940 (54 Stat. 611), Loans for rural rehabilitation and relief.
43. Act of July 1, 1941 (55 Stat. 408), Loans for rural rehabilitation.
44. Act of July 22, 1942 (56 Stat. 664), Loans for rural rehabilitation.
45. Act of July 12, 1943 (57 Stat. 392), Loans for rural rehabilitation.
46. Act of June 28, 1944 (58 Stat. 425), Loans for rural rehabilitation.
47. Flood restoration loans, Second Deficiency Appropriation Act, 1943 (57 Stat. 537, 542)
48. Subsequent legislation appropriating or making available funds for such loans as those listed under numbers 33 through 47, made by or through Resettlement Administration or the Farm Security Administration.
49. Crop-insurance programs formulated pursuant to Title V of the Agricultural Adjustment Act of 1938 (the Federal Crop Insurance Act), and any amendment or supplement thereto heretofore or hereafter enacted.
50. Any indebtedness of farmers evidenced by notes or accounts receivable, title to which has been acquired in the liquidation of loans to cooperative associations made under the provisions of the Act of June 15, 1929 (46 Stat. 11). (Sec. 2, 58 Stat. 836; 12 U.S.C. 1150a) (10 FR 807, Jan. 23, 1945. Redesignated at 13 FR 6903, Nov. 24, 1948, and amended at 55 FR 38662, Sept. 20, 1990)
Comptroller General, and the regulations in this part, with respect to the claims of the agency. An agency head may adopt regulations, in accordance with the Debt Collection Act and the Joint Regulations, setting out agency procedures for the collection by administrative offset of such claims and debts. If the head of an agency of the Department adopts regulations separate from this subpart, the procedures thereby established, rather than those set out in this part, shall be followed for the collection of the claims and debts to which the separate regulations apply. If an agency does not adopt separate regulations, the Director of the Office of Finance and Management may carry out the duties and exercise the authority of the Secretary on behalf of agency heads.
(c) Except where administrative offset is explicitly prohibited by statute or where other procedures are explicitly provided for by statute, all contracts and other written agreements which are executed after the effective date of these regulations between an agency and any person or entity must include the following or substantially similar language: Any monies that are payable or may become payable from the United States under this agreement to any person or legal entity not an agency or subdivision of a State or local government may be subject to administrative offset for the collection of a delinquent debt the person or legal entity owes to the United States, under the Federal Claims Collection Act of 1966, as amended by the Debt Collection Act of 1982 (31 U.S.C. 3701, 3711, 3716-3719); 4 CFR Part 102 and Subpart B of this part. Information on the person's or legal entity's responsibility for a commercial debt or delinquent consumer debt owed the United States will be disclosed to consumer or commercial credit reporting agencies. (50 FR 7722, Feb. 26, 1985, as amended at 55 FR 38662, Sept. 20, 1990)
Subpart B-Debt Collection
AUTHORITY: 31 U.S.C. 3701, 3711, 37163719, 3728; 4 CFR Part 102; 4 CFR 105.4.
SOURCE: 50 FR 7722, Feb. 26, 1985, unless otherwise noted.
8 3.21 Debt collection standards.
(a) The regulations in this subpart are issued under the Federal Claims Collection Act of 1966, as amended by the Debt Collection Act of 1982 (31 U.S.C. 3701, 3711, 3716-3719), and the Joint Regulations issued under the Act by the Attorney General and the Comptroller General (4 CFR Parts 101-105), prescribing Governmentwide standards for administrative col. lection, compromise, suspension or termination of agency collection action, disclosure of debt information to consumer reporting agencies, referral of claims to private collection contractors for resolution, and referral to the General Accounting Office and to the Department of Justice for litigation of civil claims by the Government for money or property.
(b) The head of each agency of the Department may carry out the duties and exercise the authority of the Secretary under 31 U.S.C. 3701, 3711, 3716-3719, 3728, the Joint Regulations of the Attorney General and the
$ 3.22 Definitions.
In this subpart:
(a) Debt management officer means an agency employee responsible for collection by administrative offset of debts owed the United States.
(b) Contracting officer has the same meaning as in 41 U.S.C. 601.