64274 Federal Register / Vol. 62, No. 234 / Friday, December 5, 1997 / Rules and Regulations

SUPPLEMENTARY INFORMATION: Section

8(b) of Public Law 101–552, enacted

November 15, 1990, amended section

3711 of title 31 of the United States

Code to increase from $20,000 to

$100,000 (or a higher amount if so

prescribed by the Attorney General) the

amount of a claim that an agency is

authorized to compromise. Consistent

with the change in the law, the Board

is amending § 340.13 of its regulations

under the Railroad Unemployment

Insurance Act to reflect this change in

law.

The Board, with the concurrence of

the Office of Management and Budget,

has determined that this is not a major

rule for the purposes of Executive Order

12866. Therefore, no regulatory analysis

is required. This rule does not involve

any information collection

requirements.

The Board published this rule as an

interim final rule on August 1, 1997 (62

FR 41270), and comments were invited

by September 30, 1997. No comments

were received. Accordingly, the interim

final rule is adopted as a final rule

without change.

Dated: November 25, 1997.

By Authority of the Board.

Beatrice Ezerski,

Secretary to the Board.

[FR Doc. 97–31905 Filed 12–4–97; 8:45 am]

BILLING CODE 7905–01–P

SOCIAL SECURITY ADMINISTRATION

20 CFR Parts 404 and 422

RIN 0960–AE09

Federal Old-Age, Survivors, and

Disability Insurance; Disclosure of

Information to Consumer Reporting

Agencies and Overpayment Recovery

Through Administrative Offset Against

Federal Payments

AGENCY: Social Security Administration.

ACTION: Final rule.

SUMMARY: In this final rule, we are

making several revisions to our

regulations dealing with debt collection.

First, we are modifying the regulations

dealing with the recovery of benefit

overpayments under title II of the Social

Security Act (the Act) to reflect statutory

authority for the Social Security

Administration (SSA) to selectively

refer information to consumer reporting

agencies and to recover title II

overpayments through administrative

offset by the Department of the Treasury

against other Federal payments to which

the overpaid individual may be entitled.

These collection practices are limited to

overpayments made to a person after he

or she attained age 18 that are

determined to be otherwise

unrecoverable under section 204 of the

Act after the individual ceases to be a

beneficiary under title II of the Act.

Second, as an independent agency in

the executive branch of the U.S.

Government, we are establishing a new

subpart D in part 422 of title 20 of the

Code of Federal Regulations which

explains our rules on debt collection

procedures for both administrative debts

and for title II program overpayments

determined to be otherwise

unrecoverable under section 204 of the

Act. These rules for the new subpart D

address the reporting of delinquent

debts to consumer and other credit

reporting agencies and the use of

administrative offset through the

Department of the Treasury. Third, we

are revising our rules on the recovery of

title II program overpayments through

the use of the Federal income tax refund

offset (TRO) provisions to reflect that,

beginning January 1, 1998, the

Department of the Treasury, rather than

the Internal Revenue Service (IRS), will

administer the TRO program, and to

reflect other changes in policies and

procedures applied by the IRS and the

Department of the Treasury in the TRO

program.

EFFECTIVE DATE: This final rule is

effective January 5, 1998.

FOR FURTHER INFORMATION CONTACT:

Robert J. Augustine, Legal Assistant,

Division of Regulations and Rulings,

Social Security Administration, 6401

Security Boulevard, Baltimore, MD

21235, (410) 966–5121. For information

on eligibility or claiming benefits, call

our national toll-free number, 1–800–

772–1213.

SUPPLEMENTARY INFORMATION: Section

204 of the Act prescribes the methods

SSA may use to recover Social Security

benefits erroneously paid under title II

of the Act (title II program

overpayments), as distinguished from

the methods SSA may use to collect

other debts owed the agency

(administrative debts) that are

recoverable under other statutory

authority. Until recently, SSA was

authorized to recover title II program

overpayments only through adjustment

of future benefits payable to the

overpaid individual or to others on the

earnings record on which the

overpayment was made, by direct

recovery from the overpaid person (or

the overpaid person’s estate, if

deceased), or by offset against Federal

income tax refunds due from the

Department of the Treasury.

Amendments to section 204 of the Act

by section 5 of Pub. L. 103–387 (1994)

and section 31001(z)(2) of Pub. L. 104–

134 (1996) permit SSA to use several

debt collection procedures that have

been available to Federal agencies

(including SSA) by statute since 1982,

but that SSA had been precluded from

using to recover title II program

overpayments. Among other things,

these procedures include reporting

delinquent debts to consumer and other

credit reporting agencies and recovering

debts by administrative offset against

other Federal payments to which the

debtor is entitled. Under section 204(f)

of the Act (42 U.S.C. 404(f)), these

additional debt collection procedures

may be used to recover title II program

overpayments only if the overpayment

was made to a person after he or she

attained age 18 and the overpayment

has been determined to be otherwise

unrecoverable under section 204 of the

Act after the overpaid person is no

longer entitled to benefits under title II

of the Act.

Before we can refer information to

consumer or other credit reporting

agencies or refer a debt to the

Department of the Treasury for

administrative offset (either title II

program overpayments or

administrative debts), we must (1) send

the debtor written notice (or, in the case

of an individual for whom we do not

have a current address, take reasonable

action to locate and send written notice)

describing the amount and nature of the

debt, the action that we propose to take,

and the debtor’s rights to an explanation

of the debt, to request us to review the

debt, to dispute the accuracy of the

information about the debt, and to

inspect or copy our records about the

debt; and (2) give the debtor at least 60
Federal Register / Vol. 62, No. 234 / Friday, December 5, 1997 / Rules and Regulations 64275

calendar days to present evidence that

all or part of the debt is not past-due or

not legally enforceable, or enter into a

written agreement to pay the debt.

Prior to March 31, 1995, SSA was an

operating division of the Department of

Health and Human Services (DHHS).

SSA relied on the DHHS rules at 45 CFR

part 30 for debt collection (other than

collection of title II program

overpayments). The Social Security

Independence and Program

Improvements Act of 1994 (SSIPIA),

Pub. L. 103–296, established SSA as an

independent agency in the executive

branch of the Federal government

effective March 31, 1995, and vested

general regulatory authority in the

Commissioner of Social Security (the

Commissioner). Under section 106(b) of

the SSIPIA, DHHS regulations in effect

immediately before March 31, 1995,

which relate to functions now vested in

the Commissioner by reason of SSA’s

independence, continue to apply to SSA

until such time as they are modified,

suspended, terminated, or repealed by

the Commissioner. In this final rule, we

are establishing a new subpart D in part

422 of our regulations which sets forth

the SSA rules on debt collection for title

II program overpayments that have been

determined to be otherwise

unrecoverable under section 204 of the

Act and for administrative debts. At this

time, we are setting forth in subpart D

our rules on referral to consumer and

other credit reporting agencies and

referral to the Department of the

Treasury for administrative offset. In the

future, as we make the necessary

systems changes and develop policies

and procedures to enable us to use

additional debt collection tools for

recovery of title II program

overpayments, we will modify subpart

D of part 422. In the meantime, we will

continue to rely on the definitions and

additional collection methods contained

in the DHHS regulations in 45 CFR part

30 to recover administrative debts owed

the Federal government.

We are also revising our rules on the

recovery of title II program

overpayments through the withholding

of amounts due to former beneficiaries

as Federal income tax refunds to reflect

the fact that, beginning January 1, 1998,

the TRO program will be administered

by the Department of the Treasury,

Financial Management Service (FMS),

instead of the IRS. The policy requiring

agencies to delay referral of debts for

TRO for three months after the right to

collect first accrued has been rescinded.

Also, the TRO program, as administered

by FMS, will be ongoing rather than

cyclical so that it will no longer be

necessary for agencies to recertify

amounts of a particular debt for

collection by TRO each year. Instead, if

the entire debt is not recovered in a

given year, the case will remain with

FMS for collection of the remainder by

offset in succeeding years.

Public Comments

On August 7, 1997, we published

proposed rules in the Federal Register

at 62 FR 42439 and provided a 60-day

period for interested individuals to

comment. We received a total of three

letters on the proposed rules: one from

a private attorney, one from a disability

law center, and one from a member of

Congress. After carefully considering

the comments received, we have

decided to adopt the proposed rules

with only a few clarifying changes. The

comments and our responses to them

are summarized below.

Comment: Two commenters objected

to the proposed rules based on the

assumption that the debtors subject to

these rules have no input into the

calculation of their debts and are

without adequate protections.

Response: The debtors who will be

selected for the new debt collection

techniques are those from whom SSA

has attempted numerous times to collect

the debts, both by written notices and

personal contacts. In the initial

overpayment notice, SSA advises the

debtor of the right to request

reconsideration of the fact and amount

of the debt, and thereby challenge the

calculation and existence of the debt. In

this same notice, SSA also advises the

debtor about the right to request waiver.

In addition, SSA’s separate notice to the

debtor of the Agency’s intent to refer

information about the debt to the

Department of the Treasury and to the

consumer reporting agencies offers the

debtor the opportunity to request

waiver, present evidence showing that

the debt is not past-due and/or legally

enforceable, and dispute the accuracy of

information about the debt that we

would refer. We believe that our

procedures adequately protect

individuals by allowing ample

opportunity to the debtors to both

dispute the amount of the overpayment

and/or to request waiver.

Comment: One commenter asked the

Agency not to issue final regulations

until it: (1) runs a test program to assure

that overpayments preventable by SSA

are not occurring; (2) tests a program of

appointing free advocates (who may be

SSA employees) to counsel and

represent those accused of receiving

overpayments; and (3) assures that

people accused of using overpayments

understand that a report is made to a

consumer reporting agency immediately

unless they appeal or reach agreement

with SSA.

Response: We are not adopting this

comment. With regard to the

commenter’s first concern above, SSA

has had a longstanding and

comprehensive quality assurance

program that reviews overpayments,

including those preventable by SSA.

The program studies significant samples

of claims, identifying problem areas that

need to be corrected. We believe this

quality assurance program corresponds

to the test program suggested by the

commenter.

With regard to the commenter’s

second point, SSA already takes several

steps toward helping overpaid

individuals obtain representation.

Information on the individual’s right to

seek and use representation is included

in SSA’s initial overpayment notices. In

addition, SSA offers to provide

information on advocacy groups that do

not charge people who qualify for their

services.

Regarding the commenter’s third

point, SSA will not report information

to consumer reporting agencies

immediately. SSA will wait at least 60

days after the date of the notice to report

the delinquency to consumer reporting

agencies. During the 60-day due process

period, SSA provides the debtor with

the opportunity to request review of the

debt, dispute the accuracy of the

information to be reported, request

waiver, or enter into an installment

agreement. All of these rights are clearly

explained in the notice to the debtor.

Comment: One commenter objected to

the practice of sending one pre-offset

notice to the debtor explaining that the

debt is being referred to the Department

of the Treasury for TRO and that future

tax refunds will be offset to recover the

overpayment. The commenter believes

that we should provide separate notices

before subsequent offsets.

Response: This practice is consistent

with the Department of the Treasury’s

existing process whereby no additional

notice is necessary if there are multiple

offsets in one year to recover an

overpayment debt. It is also consistent

with the Department of the Treasury’s

regulations and operating procedures

which require notice at least 60 calendar

days before the date of referral to the

Department of the Treasury.

Comment: SSA’s notices described in

§ 404.521 of the proposed rules should

contain language explaining that the

debtor may enter into a repayment

agreement with SSA.

Response: Since the beginning of the

TRO program, SSA’s notices have

contained such language. The notices

issued under these final regulations also
64276 Federal Register / Vol. 62, No. 234 / Friday, December 5, 1997 / Rules and Regulations

contain the language which offers the

opportunity to pay the debt by

installments. One of the principles that

SSA uses in the offset program is to

extend to the debtor as many

opportunities as possible to pay the debt

voluntarily, rather than by offset. As

long as the debtor repays by regular

installments in accordance with his or

her payment agreement with SSA, offset

will not be used to collect the debt.

Comment: No referral to the

Department of the Treasury should

occur until all administrative reviews

have been completed or until a decision

of the Agency becomes final, in the

event that no appeal is taken. In

addition, recovery efforts by the SSA

and the Department of the Treasury

should be stopped until a waiver

request received after referral to the

Department of the Treasury has been

given full consideration.

Response: When an individual

submits a timely request for

reconsideration of the initial

overpayment decision and/or requests

waiver of collection of the overpayment,

SSA is precluded from any recovery

action until SSA renders a decision

affirming the initial determination and/

or denying the waiver request. See

Califano v. Yamasaki, 442 U.S. 682

(1979) and § 404.506. SSA is not

required to refrain from taking

collection action concerning a title II

overpayment debt after a decision on a

request for reconsideration of the initial

overpayment determination is issued

and after a determination on a request

for waiver of recovery of the

overpayment is made after the debtor

had the opportunity for a

prerecoupment personal conference.

However, under the process adopted to

implement these final regulations SSA

would not select a title II overpayment

debt for referral to the Department of the

Treasury while an administrative appeal

regarding that debt is pending.

Section 204(f) of the Act, as amended,

authorizes SSA to collect such debts

through administrative offset by the

Department of the Treasury against

Federal payments due the debtor when,

among other things, SSA determines,

under regulations, that such debts are

otherwise unrecoverable under section

204 of the Act. In accordance with

§ 404.527(b) of these final regulations,

SSA would not select a debt as

‘‘unrecoverable’’ until a reconsideration

determination requested on the initial

determination of overpayment, or an

initial determination (after opportunity

for a personal conference) on a request

for waiver of collection, is issued and

either the billing system sequence is

completed or further collection action is

suspended or terminated. The billing

system sequence on a title II

overpayment debt would not be

completed, and collection action on

such a debt would not be suspended or

terminated, while an administrative

appeal at any level of adjudication is

pending on the matter. Thus, under

these final regulations SSA would not

select a title II overpayment debt for

collection by the Department of the

Treasury through offset against other

Federal payments while an

administrative appeal is pending at any

level of adjudication on the fact or

amount of the overpayment or on

waiver.

Similarly, the changes in these

regulations will not affect any former

beneficiary’s ability to request waiver. If

the debtor requests waiver after a case

has been referred, SSA will instruct the

Department of the Treasury to cease

collection efforts until the waiver

request is adjudicated.

Comment: SSA should raise its

monetary threshold for referral to the

Department of the Treasury from $25 to

$500.

Response: The $25 debt threshold is

consistent with the regulations issued

by Treasury and is used

governmentwide. SSA has also

determined it to be cost-effective. SSA

will continue to use the $25 threshold

in applying these rules.

Comment: The notice SSA will send

to debtors informing them that the

Agency intends to report their debts to

consumer reporting agencies should

include the right to request waiver of

the overpayment.

Response: Unlike 31 U.S.C. 3720A(f)

pertaining to the TRO notice to debtors,

the statute (31 U.S.C. 3711(e)(1)(C))

pertaining to the notice to debtors about

referral to consumer reporting agencies

does not require an explanation of

waiver. However, SSA notifies debtors

about TRO, offset of other Federal

payments and referral to consumer

reporting agencies concurrently, and

these notices explain the debtors’

waiver rights. If the debtor requests

waiver within the 60-calendar-day

period allowed by the notice, SSA will

not report the debt to the credit bureaus

until the waiver request has been

adjudicated.

Explanation of Changes to Regulations

We are revising our title II rules on

TRO at §§ 404.520–404.526 to reflect

several changes in the TRO process

promulgated by the Department of the

Treasury. Beginning January 1, 1998, we

will be referring title II program

overpayments for TRO to the

Department of the Treasury, rather than

to IRS. Section 404.520 is revised to

delete the requirement that a debt may

not be referred for TRO before the

expiration of three months after our

right to collect first accrued. Section

404.526 is also revised by deleting

reference to the need to recertify an

overpayment for TRO in cases where a

tax refund is insufficient to recover the

entire amount of an overpayment in a

given year, reflecting the fact that the

case will now remain with the

Department of the Treasury for offset in

succeeding years without need for

recertification. In this final rule, we

have inserted at the end of § 404.520(a)

a reference to the current regulation of

the Department of the Treasury (31 CFR

285.2) which supersedes the IRS

regulation (26 CFR 301.6402–6) that was

cited in the notice of proposed

rulemaking.

We are adding a new § 404.527 to our

regulations to explain that we will use

the additional debt collection methods

authorized by section 204(f) of the Act

to recover title II program overpayments

if the overpayment occurred after the

individual attained age 18, and the

overpayment has been determined to be

otherwise unrecoverable under section

204 of the Act after the individual is no

longer entitled to benefits under title II

of the Act. Section 404.527 also contains

the criteria under which we determine

that an overpayment is ‘‘otherwise

unrecoverable under section 204 of the

Act.’’ An overpayment debt will be

determined to be unrecoverable when

all of the following conditions are met:

we completed our billing sequence or

collection activity has been suspended

or terminated in accordance with the

Federal Claims Collection Standards in

4 CFR 104.2 and 104.3; there is no

installment payment agreement or the

overpaid person has failed to pay in

accordance with such an agreement for

two consecutive months; the overpaid

individual has not requested waiver or,

after appropriate review of such a

request, we have determined that we

will not waive collection of the

overpayment; the overpaid person has

not requested reconsideration of the

initial overpayment determination or,

after our review of such determination,

we have affirmed such determination

wholly or partially; we cannot collect

the overpayment by adjusting benefits

payable to individuals other than the

overpaid person. For purposes of

§ 404.527, an overpayment will be

deemed to be unrecoverable from an

individual who lived in a separate

household from the overpaid person

when the overpayment occurred and

who did not receive the overpayment.
Federal Register / Vol. 62, No. 234 / Friday, December 5, 1997 / Rules and Regulations 64277

Adjustment of benefits is waived when

waiver is requested under these

circumstances. See § 404.509.

We are adding to § 404.903 new

paragraphs (t) and (u) to include in the

list of administrative actions that are not

initial determinations our

determinations whether we will refer

information about an overpayment debt

to consumer reporting agencies and

whether we will refer the debt to the

Department of the Treasury for offset

against other Federal payments due the

overpaid person. Administrative actions

that are not initial determinations may

be reviewed by us, but they are not

subject to the administrative review

process provided by subpart J of our

regulations at 20 CFR Part 404, and they

are not subject to judicial review.

We are also creating a new subpart D

to part 422 of our regulations to contain

our rules on certain debt collection

practices and procedures. In § 422.301,

we specify that the debt collection tools

in subpart D may be used to recover

both title II program overpayments the

Commissioner has determined to be

unrecoverable under section 204 of the

Act and overdue administrative debts

owed the agency.

In § 422.305, we explain that we will

refer all overdue title II program debts

over $25, found to be otherwise

unrecoverable under section 204 of the

Act, to consumer reporting agencies. We

describe the information we must

include in the notice we send to the

debtor before we report the debt to a

consumer reporting agency. We also

explain in this section that, in cases

where an individual disputes the

information we propose to refer to a

consumer reporting agency within 60

calendar days of our notice of our

proposed referral, we will not send the

information until we determine the

correct information.

In § 422.306, we explain that we will

refer all overdue administrative debts

over $25 to credit reporting agencies.

We also describe the information we

must include in the notice we send to

the debtor before we report the debt to

a credit reporting agency. Examples of

administrative debts are overpayments

of employees’ pay and allowances, debts

for civil money penalties imposed under

section 1140(b) of the Act, debts for

unpaid fees for reimbursable services by

SSA (e.g., disclosure of information),

contractor debts, etc.

In § 422.310, we explain our rules

relating to referring debts to the

Department of the Treasury for

administrative offset. Specifically, we

explain that we will refer overdue debts

over $25 to the Department of the

Treasury for offset against any Federal

payments due the debtor. We also

describe the information we must

include in the notice we send to the

debtor before referring the debt to the

Department of the Treasury for

administrative offset.

In this final rule, we are revising the

language of §§ 422.305(b)(2),

422.306(b)(2) and 422.310(c)(2) as it

appeared in the proposed rules to

clearly state that we will not refer

information on debts to consumer

reporting agencies or to the Department

of the Treasury for administrative offset

before the expiration of 60 calendar

days from the dates of the notices

described in those regulations.

In § 422.315, we explain that a debtor

has the right to inspect or copy our

records related to a debt before we refer

the debt to a consumer or credit

reporting agency or to the Department of

the Treasury for administrative offset,

and the procedures for exercising that

right.

In § 422.317, we explain that a debtor

has the right to have us review the debt.

To exercise this right, the debtor must

notify us within 60 calendar days from

the date of our notice of proposed

referral and give us evidence that he or

she does not owe all or part of the debt,

or we do not have the right to collect it.

After our review of the evidence, we

explain that we will issue written

findings of our review. If the debtor

requests review and submits evidence

within the 60-day period, we will not

refer the debt to consumer or credit

reporting agencies or to the Department

of the Treasury unless and until we

have completed our review and sent our

findings to the debtor that all or part of

the debt is overdue and legally

enforceable.

Regulatory Procedures

Executive Order 12866

We have consulted with the Office of

Management and Budget (OMB) and

determined that these proposed rules do

not meet the criteria for a significant

regulatory action under Executive Order

12866. Thus, they were not subject to

OMB review.

Regulatory Flexibility Act

We certify that these proposed

regulations will not have a significant

impact on a substantial number of small

entities. Therefore, a regulatory

flexibility analysis, as provided in the

Regulatory Flexibility Act, as amended,

is not required.

Paperwork Reduction Act

These proposed regulations will

impose no new reporting or

recordkeeping requirements requiring

OMB clearance.

(Catalog of Federal Domestic Assistance

Programs No. 96.001, Social Security—

Disability Insurance; 96.002 Social

Security—Retirement Insurance; 96.003

Social Security—Special Benefits for Persons

Aged 72 and Over; 96.004, Social Security—

Survivors Insurance)

List of Subjects

20 CFR Part 404

Administrative practice and

procedure, Death benefits, Blind,

Disability benefits, Old-Age, Survivors

and Disability Insurance, Reporting and

recordkeeping requirements, Social

Security.

20 CFR Part 422

Administrative practice and

procedure, Organization and functions

(Government agencies), Social Security.

Dated: December 2, 1997.

Kenneth S. Apfel,

Commissioner of Social Security.

For the reasons set out in the

preamble, subparts F and J of Part 404

of Chapter III of Title 20 of the Code of

Federal Regulations are amended and a

new subpart D is added to Part 422 of

Chapter III of Title 20 of the Code of

Federal Regulations as follows:

PART 404—[AMENDED]

1. The authority citation for subpart F

of Part 404 is revised to read as follows:

Authority: Secs. 204, 205(a), and 702(a)(5)

of the Social Security Act (42 U.S.C. 404,

405(a), and 902(a)); 31 U.S.C. 3720A.

2. Section 404.520 is revised to read

as follows:

§ 404.520 Referral of overpayments to the

Department of the Treasury for tax refund

offset—General.

(a) The standards we will apply and

the procedures we will follow before

requesting the Department of the

Treasury to offset income tax refunds

due taxpayers who have an outstanding

overpayment are set forth in §§ 404.520

through 404.526. These standards and

procedures are authorized by 31 U.S.C.

3720A and are implemented through

Department of the Treasury regulations

at 31 CFR 285.2.

(b) We will use the Department of the

Treasury tax refund offset procedure to

collect overpayments that are certain in

amount, past due and legally

enforceable, and eligible for tax refund

offset under regulations issued by the

Department of the Treasury. We will use

these procedures to collect

overpayments only from individuals

who are not currently entitled to
64278 Federal Register / Vol. 62, No. 234 / Friday, December 5, 1997 / Rules and Regulations

monthly Social Security benefits under

title II of the Act. We will refer an

overpayment to the Department of the

Treasury for offset against tax refunds

no later than 10 years after our right to

collect the overpayment first accrued.

3. Section 404.521 is amended by

revising the introductory text to read as

follows:

§ 404.521 Notice to overpaid individual.

A request for reduction of a Federal

income tax refund will be made only

after we determine that an amount is

owed and past due and send the

overpaid individual written notice. Our

notice of intent to collect an

overpayment through tax refund offset

will state:

* * * * *

4. Section 404.526 is revised to read

as follows:

§ 404.526 Tax refund insufficient to cover

amount of overpayment.

If a tax refund for a given taxable year

is insufficient to recover an

overpayment completely, the case will

remain with the Department of the

Treasury for offset, assuming that all

criteria for offset continue to be met.

5. Section 404.527 is added to subpart

F to read as follows:

§ 404.527 Additional methods for recovery

of title II benefit overpayments.

(a) General. In addition to the

methods specified in §§ 404.502 and

404.520, an overpayment under title II

of the Act is also subject to recovery

under the rules in subpart D of part 422,

provided:

(1) The overpayment occurred after

the individual has attained age 18;

(2) The overpaid individual is no

longer entitled to benefits under title II

of the Act; and

(3) Pursuant to paragraph (b) of this

section, we have determined that the

overpayment is otherwise unrecoverable

under section 204 of the Act.

(b) When an overpayment is

considered to be otherwise

unrecoverable. An overpayment under

title II of the Act is considered to be

otherwise unrecoverable under section

204 of the Act if all of the following

conditions are met:

(1) Our billing system sequence has

been completed (i.e., we have sent the

individual an initial notice of the

overpayment, a reminder notice, and a

past-due notice) or collection activity

has been suspended or terminated in

accordance with the Federal Claims

Collection Standards in 4 CFR 104.2 or

104.3.

(2) We have not entered into an

installment payment arrangement with

the overpaid individual or, if we have

entered into such an arrangement, the

overpaid individual has failed to make

any payment for two consecutive

months.

(3) The overpaid individual has not

requested waiver pursuant to § 404.506

or § 404.522 or, after a review conducted

pursuant to those sections, we have

determined that we will not waive

collection of the overpayment.

(4) The overpaid individual has not

requested reconsideration of the initial

overpayment determination pursuant to

§§ 404.907 and 404.909 or, after a

review conducted pursuant to § 404.913,

we have affirmed, in whole or in part,

the initial overpayment determination.

(5) The overpayment cannot be

recovered pursuant to § 404.502 by

adjustment of benefits payable to any

individual other than the overpaid

individual. For purposes of this

paragraph, an overpayment will be

deemed to be unrecoverable from any

individual who was living in a separate

household from the overpaid person at

the time of the overpayment and did not

receive the overpayment.

6. In addition to the amendments set

forth above, remove the acronym ‘‘IRS’’

and add, in its place, the words

‘‘Department of the Treasury’’ in the

following places:

(a) Section 404.521(b);

(b) Section 404.522(b);

(c) Section 404.523 (a) and (c) (both

places); and

(d) Section 404.525.

7. The authority citation for subpart J

of Part 404 is revised to read as follows:

Authority: Secs. 201(j), 204(f), 205(a), (b),

(d)–(h), and (j), 221, 225, and 702(a)(5) of the

Social Security Act (42 U.S.C. 401(j), 404(f),

405(a), (b), (d)–(h), and (j), 421, 425, and

902(a)(5)); 31 U.S.C. 3720A; sec. 5, Pub. L.

97–455, 96 Stat. 2500 (42 U.S.C. 405 note);

secs. 5, 6(c)–(e), and 15, Pub. L. 98–460, 98

Stat. 1802 (42 U.S.C. 421 note).

8. Section 404.903 is amended by

deleting the word ‘‘and’’ at the end of

paragraph (r), replacing the period at the

end of paragraph (s) with a semicolon,

and adding paragraphs (t) and (u) to

read as follows:

§ 404.903 Administrative actions that are

not initial determinations.

* * * * *

(t) Determining whether we will refer

information about your overpayment to

a consumer reporting agency (see

§§ 404.527 and 422.305 of this chapter);

and

(u) Determining whether we will refer

your overpayment to the Department of

the Treasury for collection by offset

against Federal payments due you (see

§§ 404.527 and 422.310 of this chapter).

PART 422—ORGANIZATION AND

PROCEDURES

10. Subpart D is added to read as

follows:

Subpart D—Claims Collection

Sec.

422.301 Material included in this subpart.

422.305 Report of overdue title II program

overpayment debts to consumer

reporting agencies.

422.306 Report of overdue administrative

debts to credit reporting agencies.

422.310 Collection of overdue debts by

administrative offset.

422.315 Review of our records related to the

debt.

422.317 Review of the debt.

Subpart D—Claims Collection

Authority: Secs. 204(f), 205(a), and

702(a)(5) of the Social Security Act (42 U.S.C.

404(f), 405(a), and 902(a)(5)); 31 U.S.C.

3711(e); 31 U.S.C. 3716.

§ 422.301 Material included in this subpart.

This subpart describes the procedures

relating to collection of:

(a) Overdue administrative debts, and

(b) Overdue title II program

overpayments described in § 404.527 of

this chapter.

§ 422.305 Report of overdue title II

program overpayment debts to consumer

reporting agencies.

(a) Debts we will report. We will

report to consumer reporting agencies

all overdue title II program overpayment

debts over $25.

(b) Notice to debtor. Before we report

any such debt to a consumer reporting

agency, we will send the debtor written

notice of the following:

(1) We have determined that payment

of the debt is overdue;

(2) We will refer the debt to a

consumer reporting agency at the

expiration of not less than 60 calendar

days after the date of the notice unless,

within that 60-day period, the debtor

pays the full amount of the debt or takes

either of the actions described in

paragraphs (b)(6) or (b)(7) of this

section;

(3) The specific information we will

provide to the consumer reporting

agency, including information that

identifies the debtor (e.g., name,

address, and social security number)

and the amount, status, and history of

the debt;

(4) The debtor has the right to a

complete explanation of the debt;

(5) The debtor may dispute the

accuracy of the information to be

provided to the consumer reporting

agency;

(6) The debtor may request a review

of the debt by giving us evidence
Federal Register / Vol. 62, No. 234 / Friday, December 5, 1997 / Rules and Regulations 64279

showing that he or she does not owe all

or part of the amount of the debt or that

we do not have the right to collect it;

and

(7) The debtor may request an

installment payment plan.

(c) Disputing the information that we

would send to consumer reporting

agencies. If a debtor believes that the

information we propose to send to

consumer reporting agencies is

incorrect, the debtor may ask us to

correct such information. If, within 60

calendar days from the date of our

notice described in paragraph (b) of this

section, the debtor notifies us that any

information to be sent to consumer

reporting agencies is incorrect, we will

not send the information to consumer

reporting agencies until we determine

the correct information.

§ 422.306 Report of overdue administrative

debts to credit reporting agencies.

(a) Debts we will report. We will

report to credit reporting agencies all

overdue administrative debts over $25.

Some examples of administrative debts

are as follows: overpayments of pay and

allowances paid to employees, debts for

civil monetary penalties imposed under

section 1140(b) of the Act, debts for

unpaid fees for reimbursable services

performed by SSA (e.g., disclosures of

information), and contractor debts.

(b) Notice to debtor. Before we report

any administrative debt to a credit

reporting agency, we will send the

debtor written notice of the following:

(1) We have determined that payment

of the debt is overdue;

(2) We will refer the debt to a credit

reporting agency at the expiration of not

less than 60 calendar days after the date

of the notice unless, within that 60-day

period, the debtor pays the full amount

of the debt or takes either of the actions

described in paragraphs (b)(6) or (b)(7)

of this section;

(3) The specific information we will

provide to the credit reporting agency,

including information that identifies the

debtor (e.g., name, address, social

security number, and employer

identification number) and the amount,

status, and history of the debt;

(4) The debtor has the right to a

complete explanation of the debt;

(5) The debtor may dispute the

accuracy of the information to be

provided to the credit reporting agency;

(6) The debtor may request a review

of the debt by giving us evidence

showing that he or she does not owe all

or part of the amount of the debt or that

we do not have the right to collect it;

and

(7) The debtor may request an

installment payment plan.

§ 422.310 Collection of overdue debts by

administrative offset.

(a) Referral to the Department of the

Treasury for offset. We will recover

overdue debts by offsetting Federal

payments due the debtor through the

Treasury Offset Program (TOP). TOP is

a Governmentwide delinquent debt

matching and payment offset process

operated by the Department of the

Treasury, whereby debts owed to the

Federal Government are collected by

offsetting them against Federal

payments owed the debtor.

(b) Debts we will refer. We will refer

for administrative offset all overdue

debts over $25.

(c) Notice to debtor. Before we refer

any debt for collection by administrative

offset, we will send the debtor written

notice that:

(1) We have determined that payment

of the debt is overdue;

(2) We will refer the debt for

administrative offset at the expiration of

not less than 60 calendar days after the

date of the notice unless, within that 60-

day period, the debtor pays the full

amount of the debt or takes either of the

actions described in paragraphs (c)(4) or

(c)(5) of this section;

(3) The debtor may inspect or copy

our records relating to the debt;

(4) The debtor may request a review

of the debt by giving us evidence

showing that the debtor does not owe all

or part of the amount of the debt or that

we do not have the right to collect it;

and

(5) The debtor may request an

installment payment plan.

§ 422.315 Review of our records related to

the debt.

(a) Notification by the debtor. The

debtor may request to inspect or copy

our records related to the debt.

(b) Our response. In response to a

request from the debtor described in

paragraph (a) of this section, we will

notify the debtor of the location and

time at which the debtor may inspect or

copy our records related to the debt. We

may also, at our discretion, mail to the

debtor copies of the records relating to

the debt.

§ 422.317 Review of the debt.

(a) Notification and presentation of

evidence by the debtor. A debtor who

receives a notice described in

§ 422.305(b), § 422.306(b), or

§ 422.310(c) has a right to have us

review the debt. To exercise this right,

within 60 calendar days from the date

of our notice, the debtor must notify us

and give us evidence that he or she does

not owe all or part of the debt or that

we do not have the right to collect it. If

the debtor does not notify us and give

us this evidence within the 60 calendarday period, we may take the action

described in our notice.

(b) Review of the evidence. If the

debtor notifies us and presents evidence

within the 60 calendar-day period

described in paragraph (a) of this

section, we will not take the action

described in our notice unless and until

we consider all of the evidence and

send the debtor our findings that all or

part of the debt is overdue and legally

enforceable.

(c) Findings by SSA. Following our

review of all of the evidence presented,

we will issue written findings,

including the supporting rationale for

the findings. Issuance of these findings

will be the final Agency action on the

debtor’s request for review. If we find

that the debt is not overdue or we do not

have the right to collect it, we will not

send information about the debt to

consumer or other credit reporting

agencies or refer the debt to the

Department of the Treasury for

administrative offset.

[FR Doc. 97–32008 Filed 12–4–97; 8:45 am]

BILLING CODE 4190–29–P

LIBRARY OF CONGRESS

36 CFR Part 701

[Docket No. LOC 98–1]

Assignment of Special Research

Facilities

AGENCY: Library of Congress.

ACTION: Final regulation.

SUMMARY: The Library of Congress

issues this final regulation to revise

Library of Congress Regulation 815–3.

The revised regulation will reflect the

change in availability for assignment of

study shelves, study desks and study

rooms, the renaming of the responsible

division from General Reading Rooms

Division to Humanities and Social

Sciences Division and to the

Congressional Relations Office for study

rooms for Congressional use.

EFFECTIVE DATE: December 5, 1997.

FOR FURTHER INFORMATION CONTACT:

Lana Kay Jones, Acting General

Counsel, Office of the General Counsel,

Library of Congress, Washington, D.C.

20540–1050. Telephone No. (202) 707–

6316.

SUPPLEMENTARY INFORMATION: This

Regulation states the Library’s policy

regarding the assignment of special

research facilities, including study

shelves, desks, and other facilities

designed for the use of scholars