[Federal Register Volume 72, Number 19 (Tuesday, January 30, 2007)]
[Rules and Regulations]
[Pages 4189-4194]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 07-387]



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Rules and Regulations
                                                Federal Register
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Federal Register / Vol. 72, No. 19 / Tuesday, January 30, 2007 / 
Rules and Regulations

[[Page 4189]]



DEPARTMENT OF HOMELAND SECURITY

Office of the Secretary

6 CFR Part 11

44 CFR Part 11

[Docket No. DHS-2006-0009]
RIN 1601-AA23


Collection of Non-Tax Debts Owed to the Department of Homeland 
Security

AGENCY: Office of the Secretary, DHS.

ACTION: Interim final rule.

-----------------------------------------------------------------------

SUMMARY: This interim final rule establishes the Department of Homeland 
Security's debt collection regulations to conform to the Debt 
Collection Act of 1982, as amended by the Debt Collection Improvement 
Act of 1996, the Federal Claims Collection Standards, and other laws 
applicable to the collection of non-tax debts owed to the Department of 
Homeland Security. This rule also promulgates regulations governing the 
offset of the Department of Homeland Security-issued payments to 
collect debts owed to other Federal agencies.

DATES: This interim final rule is effective January 30, 2007. Written 
comments may be submitted to the Department of Homeland Security on or 
before March 1, 2007.

ADDRESSES: You may submit comments, identified by DHS-2006-0009, by one 
of the following methods:
    <bullet> Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
    <bullet> Fax: 866-466-5370.
    <bullet> Mail: Department of Homeland Security, Office of Financial 
Management, Mail Stop 0200, 245 Murray Lane, SW., Bldg 410, Washington, 
DC 20528.
    <bullet> Hand Delivery / Courier: Office of Financial Management, 
Department of Homeland Security, Mail Stop 0200, 245 Murray Lane, SW., 
Bldg 410, Washington, DC 20528-0200.

FOR FURTHER INFORMATION CONTACT: Jean D. Francis, telephone number 202-
447-5199. This is not a toll free call.

SUPPLEMENTARY INFORMATION:

I. Public Participation

    Interested persons are invited to participate in this rulemaking by 
submitting written data, views, or arguments on all aspects of the 
proposed rule. The Department of Homeland Security (DHS) also invites 
comments that relate to the economic, environmental, or federalism 
effects that might result from this proposed rule. Comments that will 
provide the most assistance in developing these procedures will 
reference a specific portion of the proposed rule, explain the reason 
for any recommended change, and include data, information, or authority 
that support such recommended change.
    Instructions: All submissions received must include the agency name 
and docket number for this rulemaking. All comments received will be 
posted without change to http://www.regulations.gov, including any 
personal information provided.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.regulations.gov.

II. Background

    This interim final rule implements the DHS debt collection 
regulations to conform to the Debt Collection Act of 1982, Public Law 
97-365, 96 Stat. 1749 (Oct. 25, 1982), as amended by the Debt 
Collection Improvement Act of 1996 (DCIA), Public Law 104-134, 110 
Stat. 1321, 1358 (Apr. 26, 1996), the Federal Claims Collection 
Standards, 31 CFR parts 900 through 904, Debt Collection Authorities 
Under the Debt Collection Improvement Act of 1996, 31 CFR part 285, and 
other laws applicable to the collection of non-tax debt owed to the 
Government.
    This interim final rule provides procedures for the collection of 
non-tax debts owed to DHS. This rule adopts the Government-wide debt 
collection standards promulgated by the Departments of the Treasury and 
Justice, known as the Federal Claims Collection Standards (FCCS), as 
revised on November 22, 2000 (65 FR 70390; 31 CFR parts 900-904), and 
supplements the FCCS by prescribing procedures consistent with the 
FCCS, as necessary and appropriate for DHS operations. DHS components 
may, but are not required to, promulgate additional policies and 
procedures consistent with this regulation, the FCCS, and other 
applicable Federal laws, policies, and procedures. This regulation also 
provides the procedures for the collection of debts owed to other 
Federal agencies when a request for offset is received by DHS.
    This interim final rule does not apply to the collection of tax 
debts under the Internal Revenue Code of 1986, as amended, 26 U.S.C., 
and regulations, policies and procedures issued by the Internal Revenue 
Service. This regulation also does not apply to the collection of 
debts, by administrative offset, arising under the tariff laws of the 
United States, including, for example, duty bills, penalties, user 
fees, and liquidated damages, which are governed by the Tariff Act of 
1930, as amended, 19 U.S.C., nor to the collection of debts, nor 
procedures thereof, excepted by 31 CFR parts 900 through 904.
    Nothing in this regulation precludes the use of collection remedies 
not contained in this regulation. For example, DHS may collect unused 
travel advances through offset of an employee's pay under 5 U.S.C. 
5705. DHS and other Federal agencies may simultaneously use multiple 
collection remedies to collect a debt, except as prohibited by law.
    Part 11, Subpart A, addresses the general provisions applicable to 
the collection of non-tax debts owed to DHS, including all its 
components. As stated in section 11.1 of this rule, nothing in this 
regulation requires DHS to duplicate notices or administrative 
proceedings required by contract, this regulation or other laws or 
regulations. Thus, for example, DHS is not required to provide a debtor 
with two hearings on the same issue merely because DHS uses two 
different collection tools, each of which requires that the debtor be 
provided with a hearing.
    This regulation describes the procedures to be followed by DHS when 
collecting debts owed to DHS. Among other things, this regulation 
specifically

[[Page 4190]]

adopts the due process procedures of the FCCS. DHS is required to 
follow due process when using offset (administrative, tax refund and 
salary) to collect a debt, when garnishing a debtor's wages, or before 
reporting a debt to a credit bureau. DHS is required to provide debtors 
with notice of the amount and type of debt, the intended collection 
action to be taken, how a debtor may pay the debt or make alternate 
repayment arrangements, how a debtor may review documents related to 
the debt, how a debtor may dispute the debt, and the consequences to 
the debtor if the debt is not paid. Notices may be sent by first-class 
mail and, if not returned by the United States Postal Service, DHS may 
presume that the notice was received.
    This regulation also explains the use of offset procedures and the 
circumstances under which DHS may waive interest, penalties, and 
administrative costs. This regulation also incorporates procedures for 
several collection remedies authorized by the Debt Collection 
Improvement Act of 1996 (DCIA), such as administrative wage garnishment 
and barring delinquent debtors from obtaining additional Federal loan 
assistance. This regulation further authorizes suspension or 
termination of debt collection, and explains when DHS refers claims to 
the Department of Justice.
    Finally, this regulation prescribes the procedures for offset by 
DHS of debts owed to other federal agencies.

III. Procedural Requirements

A. Administrative Procedure Act

    DHS has determined that implementation of this rule without prior 
notice and the opportunity for public comment is warranted because this 
rule is one of agency procedure and practice and therefore is exempt 
from notice and comment rulemaking requirements under the 
Administrative Procedure Act (APA) at 5 U.S.C. 553(b)(A) and (B). DHS, 
nonetheless, invites public comment and will consider any proposals to 
improve these rules.
    Additionally, good cause exists to make this rule effective upon 
publication. This interim final rule parallels the existing operational 
regulations of other cabinet-level agencies to effectuate the 
collection of non-tariff and non-tax debts to implement 31 U.S.C. 3711. 
Similar rules are already applied by DHS components that were 
transferred to DHS from the Departments of Justice, Treasury, and 
Transportation, as well as the Federal Emergency Management Agency. 
This interim final rule establishes uniform procedures throughout DHS. 
Since this rule parallels existing, long-standing rules that have 
already been subject to APA notice and comment procedures, we believe 
that publishing this rule with the usual notice and comment procedures 
is unnecessary. Further, making this rule effective upon publication 
will permit DHS components to utilize uniform debt collection tools 
immediately. Accordingly, the Department has determined that prior 
notice and public comment procedures would be impracticable and 
unnecessary pursuant to 5 U.S.C. 553(b)(B).

B. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) mandates that an agency 
conduct an RFA analysis when an agency is ``required by section 553 * * 
*, or any other law, to publish general notice of proposed rulemaking 
for any proposed rule, or publishes a notice of proposed rulemaking for 
an interpretative rule involving the internal revenue laws of the 
United States * * *.'' 5 U.S.C. 603(a). RFA analysis is not required 
when a rule is exempt from notice and comment rulemaking under 5 U.S.C. 
553(b). DHS has determined that good cause exists under 5 U.S.C. 
553(b)(B) to exempt this rule from the notice and comment requirements 
of 5 U.S.C. 553(b). Therefore no RFA analysis under 5 U.S.C. 603 is 
required for this rule.

C. Unfunded Mandates Reform Act of 1995

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

D. Small Business Regulatory Enforcement Act of 1996

    This rule is not a major rule, as defined by section 804 of the 
Small Business Regulatory Enforcement Act of 1996. This rule will not 
result in an annual effect on the United States economy of $100 million 
or more, result in a major increase in costs or prices, or significant 
adverse effects on competition, employment, investment, productivity, 
innovation, or on the ability of United States-based companies to 
compete with foreign-based companies in domestic and export markets.

E. Paperwork Reduction Act of 1995

    This interim rule does not impose any reporting or recordkeeping 
requirements under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 
et seq.).

F. Executive Order 12866

    DHS has determined that this rulemaking is not a significant 
regulatory action for the purposes of Executive Order 12866. DHS 
states, however, that it does not believe that adopting the 
standardized procedures for debt collection for those components that 
currently do not have debt collection procedures, and standardizing the 
debt collection procedures for those components of DHS that currently 
have applicable debt collection procedures will not have an annual 
effect on the economy of $100 million or more, nor will the rules have 
other adverse economic effects.

List of Subjects

6 CFR Part 11

    Administrative practice and procedure, Claims, Debts, Garnishment 
of wages, Government employee, Hearing and appeal procedures, Pay 
administration, Salaries, Wages.

44 CFR Part 11

    Claims, Government employees, Income taxes, Reporting and 
recordkeeping, Wages.

Authority and Issuance

0
For the reasons set forth above, 6 CFR and 46 CFR part 11 are amended 
as follows.

6 CFR Chapter 1--Department of Homeland Security, Office of the 
Secretary

0
1. Part 11 is added to read as follows:

PART 11--CLAIMS

Subpart A--Debt Collection

Sec.
11.1 General application.
11.2 Definitions.
11.3 Demand for payment.
11.4 Collection by administrative offset.
11.5 Administrative wage garnishment.
11.6 Reporting debts.
11.7 Private collection agencies.
11.8 Suspension or revocation of eligibility for loans and loan 
guarantees, licenses, permits, or privileges.
11.9 Collection in installments.
11.10 Interest, penalty charges, and administrative costs.
11.11 Compromise.
11.12 Suspending or terminating collection activity.
11.13 Referrals to the Department of Justice.
11.14 Receipt of offset requests by other Federal agencies.
11.15 Applying the debt against DHS payments.


[[Page 4191]]


    Authority: 5 U.S.C. 301, 5514; 26 U.S.C. 6402, 31 U.S.C. 3701, 
3711, 3716, 3717, 3718, 3720A, 3720B, 3720D; Pub. L. 107-296, 116 
Stat. 2135 (6 U.S.C. 1 et seq.).


Sec.  11.1  General application.

    (a) Application of Debt Collection Standards. The provisions of 31 
CFR parts 285, 900-904, as amended by the Secretary of the Treasury and 
the Attorney General, are applicable to debts and debt procedures 
within the jurisdiction of the Department of Homeland Security.
    (b) Authority. The Chief Financial Officer of the Department of 
Homeland Security is delegated authority to administer this subpart and 
to redelegate authority under this subpart.
    (c) Application to DHS. This subpart provides procedures for the 
collection of DHS debts, and for collection of other debts owed to the 
United States when a request for offset of a DHS payment is received by 
the DHS from another federal agency. This subpart applies to all of 
DHS, including all of its components. It applies to the DHS when 
collecting a DHS debt, to persons who owe DHS debts, and to Federal 
agencies requesting offset of a payment issued by the DHS as a payment 
agency (including salary payments to DHS employees).
    (d) Exclusions. This subpart does not apply to debt arising from 
taxation under the Internal Revenue Act of 1986, as amended, or to any 
debt excepted from the FCCS, 31 CFR parts 900 through 904.
    (e) Non-exclusive procedure or remedy. Nothing in this subpart 
precludes collection or disposition of any debt under statutes and 
regulations other than those described in this subpart. To the extent 
that the provisions of laws or other regulations apply, including the 
remission or mitigation of fines, penalties, forfeitures and debts 
arising under the tariff laws of the United States, DHS components are 
authorized to collect debts under those laws and regulations. DHS 
components and other Federal agencies may simultaneously use multiple 
collection remedies to collect a debt, except as prohibited by law.
    (f) Additional policies and procedures. DHS components may, but are 
not required to, promulgate additional policies and procedures 
consistent with this subpart and other applicable Federal law, 
policies, and procedures.
    (g) Duplication not required. Nothing in this subpart requires DHS 
to duplicate notices or administrative proceedings required by 
contract, this subpart, or other laws or regulations.
    (h) No private rights created. This subpart does not create any 
right or benefit, substantive or procedural, enforceable at law or in 
equity by a party against the United States, its agencies, its 
officers, or any other person, nor shall the failure of any DHS 
component to comply with any of the provisions of this subpart or 31 
CFR parts 285, 900-904 be a defense to the collection of any debt or 
enforcement of any other law.


Sec.  11.2  Definitions.

    In addition to the definitions provided in 31 CFR parts 285, 900-
904, as used in this subpart:
    (a) Department of Homeland Security or DHS means the United States 
Department of Homeland Security and includes the Secretary and any DHS 
entity which reports directly or indirectly to the Secretary.
    (b) DHS debt means a debt owed to DHS by a person.
    (c) Secretary means the Secretary of Homeland Security.


Sec.  11.3  Demand for payment.

    (a) Notice requirements. Generally, before DHS starts the 
collection actions described in this subpart, DHS sends a written 
notice to the debtor under 31 CFR 901.2. The notice provided under this 
section includes notice of any and all actions DHS may take to offset 
the debt, including any notices required under 31 CFR parts 285, 900-
904.
    (b) Exceptions to notice requirements. DHS may omit from any notice 
to a debtor any provision that is not legally required given the 
collection remedies to be applied to a particular debt.


Sec.  11.4  Collection by administrative offset.

    (a) General Provisions for Offset. DHS will collect debts by 
administrative offset pursuant to 31 CFR parts 900-904.
    (b) Centralized Offset through the Treasury Offset Program. DHS 
adopts the provisions of 31 CFR 901.3.
    (c) Non-centralized Offset for DHS Debts. When centralized offset 
is not available or appropriate, DHS may collect delinquent DHS debts 
through non-centralized offset. In these cases, DHS may offset a 
payment internally or make a request directly to a Federal payment 
agency to offset a payment owed to the debtor. Before requesting a 
payment authorizing agency to conduct a non-centralized administrative 
offset, DHS will provide the debtor with the due process set forth in 
31 CFR 901.3(b)(4) and the notice requirements of 31 CFR 901.2 (unless 
the due process and notice requirements are not required under that 
part). DHS will provide the payment authorizing agency written 
certification that the debtor owes the past due, legally enforceable 
delinquent debt in the amount stated, and that DHS has fully complied 
with its regulations concerning administrative offset.
    (d) Hearing Procedures for Federal Employees. (1) Request for a 
hearing. A Federal employee who has received a notice that his or her 
DHS debt will be collected by means of salary offset may request a 
hearing concerning the existence or amount of the debt. The Federal 
employee also may request a hearing concerning the amount proposed to 
be deducted from the employee's pay each pay period. The employee must 
send any request for hearing, in writing, to the office designated in 
the notice described in section 11.4(c). The request must be received 
by the designated office on or before the 15th calendar day following 
the employee's receipt of the notice. The employee must sign the 
request and specify whether an oral or paper hearing is requested. If 
an oral hearing is requested, the employee must explain why the matter 
cannot be resolved by review of the documentary evidence alone. All 
travel expenses incurred by the Federal employee in connection with an 
in-person hearing will be borne by the employee.
    (2) Failure to submit timely request for hearing. If the employee 
fails to submit a request for hearing within the time period described 
in paragraph (d)(1) of this section, the employee will have waived the 
right to a hearing, and salary offset may be initiated. However, DHS 
should accept a late request for hearing if the employee can show that 
the late request was the result of circumstances beyond the employee's 
control or because of a failure to receive actual notice of the filing 
deadline.
    (3) Hearing official. DHS must obtain the services of a hearing 
official who is not under the supervision or control of the Secretary. 
The DHS Chief Financial Officer will coordinate DHS efforts to obtain 
the services of a hearing official.
    (4) Notice of hearing. After the employee requests a hearing, the 
designated hearing official informs the employee of the form of the 
hearing to be provided. For oral hearings, the notice sets forth the 
date, time and location of the hearing. For paper hearings, the notice 
provides the employee the date by which he or she should submit written 
arguments to the designated hearing official. The hearing official 
gives the employee reasonable time to submit documentation in support 
of the employee's position. The hearing official schedules a new 
hearing date if requested by both parties. The hearing official gives 
both parties

[[Page 4192]]

reasonable notice of the time and place of a rescheduled hearing.
    (5) Oral hearing. The hearing official conducts an oral hearing if 
he or she determines the matter cannot be resolved by review of 
documentary evidence alone (for example, when an issue of credibility 
or veracity is involved). The hearing need not take the form of an 
evidentiary hearing, but may be conducted in a manner determined by the 
hearing official, including but not limited to:
    (i) Informal conferences with the hearing official, in which the 
employee and agency representative will be given full opportunity to 
present evidence, witnesses and argument;
    (ii) Informal meetings with an interview of the employee by the 
hearing official; or
    (iii) Formal written submissions, with an opportunity for oral 
presentation.
    (6) Paper hearing. If the hearing official determines an oral 
hearing is not necessary, he or she makes the determination based upon 
a review of the available written record, including any documentation 
submitted by the employee in support of his or her position.
    (7) Failure to appear or submit documentary evidence. In the 
absence of good cause shown (for example, excused illness), if the 
employee fails to appear at an oral hearing or fails to submit 
documentary evidence as required for a paper hearing, the employee 
waives the right to a hearing, and salary offset may be initiated. 
Further, the employee is deemed to admit the existence and amount of 
the debt as described in the notice of intent to offset. If a DHS 
representative does not appear at an oral hearing, the hearing official 
shall proceed with the hearing as scheduled, and make his or her 
determination based upon the oral testimony presented and the 
documentary evidence submitted by both parties.
    (8) Burden of proof. DHS has the initial burden to prove the 
existence and amount of the debt. Thereafter, if the employee disputes 
the existence or amount of the debt, the employee must prove by a 
preponderance of the evidence that no debt exists or that the amount of 
the debt is incorrect. In addition, the employee may present evidence 
that the proposed terms of the repayment schedule are unlawful, would 
cause a financial hardship to the employee, or that collection of the 
debt may not be pursued due to operation of law.
    (9) Record. The hearing official maintains a summary record of any 
hearing provided by this subpart. Witnesses testify under oath or 
affirmation in oral hearings.
    (10) Date of decision. The hearing official issues a written 
opinion stating his or her decision, based upon documentary evidence 
and information developed at the hearing, as soon as practicable after 
the hearing but not later than 60 days after the date on which the 
request for hearing was received by DHS. If the employee requests a 
delay in the proceedings, the deadline for the decision may be 
postponed by the number of days by which the hearing was postponed. 
When a decision is not timely rendered, DHS waives penalties applied to 
the debt for the period beginning with the date the decision is due and 
ending on the date the decision is issued.
    (11) Content of decision. The written decision includes:
    (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; 
and
    (iii) The terms of any repayment schedules, if applicable.
    (12) Final agency action. The hearing official's decision is final.
    (f) Waiver not precluded. Nothing in this subpart precludes an 
employee from requesting waiver of an overpayment under 5 U.S.C. 5584 
or 8346(b), 10 U.S.C. 2774, 32 U.S.C. 716, or other statutory 
authority.
    (g) Salary offset process. (1) Determination of disposable pay. The 
Chief Financial Officer consults with the appropriate DHS payroll 
office to determine the amount of a DHS employee's disposable pay and 
will implement salary offset when requested to do so by a DHS component 
or another federal agency. If the debtor is not employed by DHS, the 
agency employing the debtor will determine the amount of the employee's 
disposable pay and implement salary offset upon request.
    (2) Amount of salary offset. The amount to be offset from each 
salary payment will be up to 15 percent of a debtor's disposable pay, 
as follows:
    (i) If the amount of the debt is equal to or less than 15 percent 
of the disposable pay, such debt generally is collected in one lump sum 
payment; or
    (ii) Installment deductions are made over a period of no greater 
than the anticipated period of employment. An installment deduction 
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 or the creditor agency has determined 
that smaller deductions are appropriate based on the employee's ability 
to pay.
    (3) Final salary payment. After the employee has separated either 
voluntarily or involuntarily from the payment agency, the payment 
agency may make a lump sum deduction exceeding 15 percent of disposable 
pay from any final salary or other payments pursuant to 31 U.S.C. 3716 
in order to satisfy a debt.
    (h) Payment agency's responsibilities. (1) As required by 5 CFR 
550.1109, if the employee separates from the payment agency from which 
DHS requested salary offset, the payment agency must certify the total 
amount of its collection and notify DHS and the employee of the amounts 
collected. If the payment agency is aware that the employee is entitled 
to payments from the Civil Service Retirement Fund and Disability Fund, 
the Federal Employee Retirement System, or other similar payments, it 
must provide written notification to the agency responsible for making 
such retirement payments that the debtor owes a debt, the amount of the 
debt, and that DHS has complied with the provisions of this section. 
DHS must submit a properly certified claim to the new payment agency 
before the collection can be made.
    (2) If the employee is already separated from employment and all 
payments due from his or her former payment agency have been made, DHS 
may request that money due and payable to the employee from the Civil 
Service Retirement Fund and Disability Fund, the Federal Employee 
Retirement System, or other similar funds, is administratively offset 
to collect the debt. Generally, DHS will collect such monies through 
the Treasury Offset Program as described in this section.
    (3) When an employee transfers to another agency, DHS should resume 
collection with the employee's new payment agency in order to continue 
salary offset.


Sec.  11.5  Administrative wage garnishment.

    DHS may collect debts from a debtor's wages by means of 
administrative wage garnishment in accordance with the requirements of 
31 U.S.C. 3720D under the procedures established in 31 CFR 285.11.


Sec.  11.6  Reporting debts.

    DHS will report delinquent debts to credit bureaus and other 
automated databases in accordance with 31 U.S.C. 3711(e), 31 CFR 901.4, 
and the Office of Management and Budget Circular A-129, ``Policies for 
Federal Credit Programs and Non-tax Receivables,'' which may be found 
at http://

[[Page 4193]]

www.fms.treas.gov/debt. At least sixty (60) days prior to reporting a 
delinquent debt to a consumer reporting agency, DHS sends a notice to 
the debtor in accordance with 6 CFR 11.3. DHS may authorize the 
Treasury Department's Financial Management Service to report to credit 
bureaus those delinquent debts that have been transferred to the 
Financial Management Service for administrative offset.


Sec.  11.7  Private collection agencies.

    DHS will transfer delinquent DHS debts to the Treasury Department's 
Financial Management Service to obtain debt collection services 
provided by private collection agencies.


Sec.  11.8  Suspension or revocation of eligibility for loans and loan 
guarantees, licenses, permits, or privileges.

    The authority to extend financial assistance in the form of a loan, 
loan guarantee, or loan insurance to any person delinquent on a nontax 
debt owed to DHS is delegated to the Chief Financial Officer.


Sec.  11.9  Collection in installments.

    DHS may accept payment of a DHS debt in regular installments, in 
accordance with the provisions of 31 CFR 901.8 and policies and 
procedures adopted by the Chief Financial Officer (CFO). The CFO will 
consult the Office of General Counsel regarding a legally enforceable 
written agreement from the debtor.


Sec.  11.10  Interest, penalty charges, and administrative costs.

    (a) Assessment and notice. DHS shall assess interest, penalties and 
administrative costs on DHS debts in accordance with 31 U.S.C. 3717 and 
31 CFR 901.9. Administrative costs of processing and handling a 
delinquent debt shall be determined by DHS.
    (b) Waiver of interest, penalties, and administrative costs. DHS 
may waive interest, penalties, and administrative costs, or any portion 
thereof, under the criteria in the FCCS, or when it determines the 
collection of these charges would be against equity and good conscience 
or not in the best interests of the United States. The authority to 
waive interest, penalties and administrative costs is delegated to the 
Chief Financial Officer. The DHS Chief Financial Officer shall issue 
written guidance on maintaining records of waivers.
    (c) Accrual during suspension of debt collection. Interest and 
related charges will not accrue during the period a hearing official 
does not render a timely decision.


Sec.  11.11  Compromise.

    DHS may compromise a debt in accordance with the provisions of 31 
CFR part 902. The Chief Financial Officer is authorized to compromise 
debts owed to DHS. No debt over $10,000 may be compromised without the 
concurrence of the Office of the General Counsel.


Sec.  11.12  Suspending or terminating collection activity.

    DHS will suspend or terminate collection activity, or discharge 
indebtedness, in accordance with 31 CFR part 903. The Chief Financial 
Officer is delegated authority to suspend or terminate collection 
activity, or to discharge indebtedness regarding debts owed to DHS, but 
for any such action involving a debt over $10,000, the Chief Financial 
Officer must obtain the concurrence of the Office of the General 
Counsel. The Chief Financial Officer is authorized to act on behalf of 
the Secretary in selling a debt, and in determining whether or not it 
is in the best interests of the United States to do so.


Sec.  11.13  Referrals to the Department of Justice.

    Referrals of debts to the Department of Justice for collection will 
be by the General Counsel.


Sec.  11.14  Receipt of offset requests by other Federal agencies.

    Other Federal agencies send non-centralized offset requests to DHS 
at: U.S. Department of Homeland Security, Attn: Chief Financial 
Officer, Mail Stop 0200, Washington, DC 20528-0200. Those agencies must 
comply with 31 CFR 901.3 when forwarding the requests to DHS. DHS does 
not review the merits of the creditor agency's determination with 
regard to the existence or the amount of the debt. When two or more 
agencies are seeking offsets from payments made to the same person, or 
when two or more debts are owed to a single creditor agency, DHS may 
determine the order in which the debts will be collected or whether one 
or more debts should be collected by offset simultaneously. For the 
purposes of this section, debts owed to DHS generally take precedence 
over debts owed to other agencies, but DHS may pay a debt to another 
agency prior to collecting for DHS. DHS determines the order of debt 
collection based upon the best interests of the United States.


Sec.  11.15  Applying the debt against DHS payments.

    (a) Notice to the Debtor. DHS sends a written notice to the debtor 
indicating a certified debt claim was received from the creditor 
agency, the amount of the debt claimed to be owed by the creditor 
agency, the estimated date the offset will begin (if more than one 
payment), and the amount of the deduction(s). For employees, DHS 
generally begins deductions from pay at the next officially established 
pay interval. Deductions continue until DHS knows the debt is paid in 
full or until otherwise instructed by the creditor agency. 
Alternatively, the amount offset may be an amount agreed upon, in 
writing, by the debtor and the creditor agency. If a DHS employee 
retires or resigns, or if his or her employment ends before collection 
of the debt is complete, DHS continues to offset, under 31 U.S.C. 3716, 
up to 100% of an employee's subsequent payments until the debt is paid 
or otherwise resolved. Such payments include a debtor's final salary 
payment, lump-sum leave payment, and other payments payable to the 
debtor by DHS. See 31 U.S.C. 3716 and 5 CFR 550.1104(l) and 
550.1104(m). If the employee is separated from DHS before the debt is 
paid in full, DHS will certify to the creditor agency the total amount 
of its collection. If DHS is aware the employee is entitled to payments 
from the Civil Service Retirement and Disability Fund, Federal Employee 
Retirement System, or other similar payments, DHS provides written 
notice to the agency making such retirement payments that the debtor 
owes a debt (including the amount) and that the provisions of 5 CFR 
550.1109 have been fully complied with. The creditor agency is 
responsible for submitting a certified claim to the agency responsible 
for making such payments before collection may begin. Generally, 
creditor agencies will collect such monies through the Treasury Offset 
Program as described in section 11.4.
    (b) Notice to the debtor. DHS provides to the debtor a copy of any 
notices sent to the creditor agency under this subpart.
    (c) Transfer of employee debtor to another Federal agency. If an 
employee debtor transfers to another Federal agency before the debt is 
paid in full, DHS notifies the creditor agency and provides it a 
certification of the total amount of its collection on the debt. The 
creditor agency is responsible for submitting a certified claim to the 
debtor's new employing agency before collection may begin.
* * * * *

[[Page 4194]]

44 CFR Chapter 1--Federal Emergency Management Agency, Department of 
Homeland Security

Subchapter A--General

PART 11--[AMENDED]

0
2. The authority citation for part 11 continues to read as follows:

    Authority: 31 U.S.C. 3701 et seq.

Subpart C--[Removed]

0
3. Subpart C, consisting of Sec. Sec.  11.30 through 11.65, is removed 
and reserved.

    Dated: January 24, 2007.
Michael Chertoff,
Secretary.
[FR Doc. 07-387 Filed 1-25-07; 2:42 pm]
BILLING CODE 4410-10-P