without recourse, administrative wage garnishment has
been undertaken, or in the event of bankruptcy, death, or
disability.
‘‘(ii) The Secretary of the Treasury may, at the re-
quest of an agency, waive the application of clause (i) to
any debt, or class of debts, if the Secretary of the Treas-
ury determines that the waiver is in the best interest of
the United States.’’.
TITLE III—SALE OF DEBTS OWED
TO UNITED STATES
SEC. 301. AUTHORITY TO SELL DEBTS.
(a) PURPOSE.—The purpose of this section is to pro-
vide that the head of each executive, judicial, or legislative
agency shall establish a program of debt sales in order
to—
(1) minimize the loan and debt portfolios of the
agency;
(2) improve credit management while serving
public needs;
(3) reduce delinquent debts held by the agency;
(4) obtain the maximum value for loan and
debt assets; and
(5) obtain valid data on the amount of the Fed-
eral subsidy inherent in loan programs conducted
pursuant to the Federal Credit Reform Act of 1990
(Public Law 93–344).
(b) SALES AUTHORIZED.—(1) The head of an execu-
tive, judicial, or legislative agency may sell, subject to sec-
tion 504(b) of the Federal Credit Reform Act of 1990 (2
U.S.C. 661c(b)) and using competitive procedures, any
nontax debt owed to the United States that is adminis-
tered by the agency.
(2) Costs the agency incurs in selling debt pursuant
to this section may be deducted from the proceeds received
from the sale. Such costs may include, but are not limited
to—
(A) the costs of computer hardware and soft-
ware, processing and telecommunications equipment,
other equipment, supplies, and furniture;
(B) personnel training and travel costs;
(C) other personnel and administrative costs;
(D) the costs of any contract for identification,
billing, or collection services;
(E) the costs of contractors assisting in the sale
of debt;
(F) the fees of appraisers, auctioneers, and re-
alty brokers;
(G) the costs of advertising and surveying; and
(H) other reasonable costs incurred by the
agency.
(3) Sales of debt under this section—
(A) shall be for—
(i) cash; or
(ii) cash and a residuary equity, joint ven-
ture, or profit participation, if the head of the
agency, in consultation with the Director of the
Office of Management and Budget and the Sec-
retary of the Treasury, determines that the pro-
ceeds will be greater than the proceeds from a
sale solely for cash;
(B) shall be without recourse against the
United States, but may include the use of guaran-
tees if otherwise authorized by law; and
(C) shall transfer to the purchaser all rights of
the United States to demand payment of the debt,
other than with respect to a residuary equity, joint
venture, or profit participation under subparagraph
(A)(ii).
(c) EXISTING AUTHORITY NOT AFFECTED.—This
section is not intended to limit existing statutory authority
of the head of an executive, judicial, or legislative agency
to sell loans, debts, or other assets.
SEC. 302. REQUIREMENT TO SELL CERTAIN DEBTS.
(a) SALE OF DELINQUENT LOANS.—The head of
each executive, judicial, or legislative agency shall sell any
nontax loan owed to the United States by the later of—
(1) the date on which the debt becomes 24
months delinquent; or
(2) 24 months after referral of the debt to the
Secretary of the Treasury pursuant to section
3711(g)(1) of title 31, United States Code. Sales
under this subsection shall be conducted under the
authority in section 301.
(b) SALE OF NEW LOANS.—The head of each execu-
tive, judicial, or legislative agency shall sell each loan obli-
gation arising from a program administered by the agen-
cy, not later than 6 months after the loan is disbursed,
unless the head of the agency determines that the sale
would interfere with the mission of the agency administer-
ing the program under which the loan was disbursed, or
the head of the agency, in consultation with the Director
of the Office of Management and Budget and the Sec-
retary of the Treasury, determines that a longer period
is necessary to protect the financial interests of the United
States. Such loan obligations shall be audited annually in
accordance with generally accepted audit standards. Sales
under this subsection shall be conducted under the author-
ity in section 301.
(c) SALE OF DEBTS AFTER TERMINATION OF COL-
LECTION ACTION.—After terminating collection action,
the head of an executive, judicial, or legislative agency
shall sell, using competitive procedures, any nontax debt
or class of debts owed to the United States unless the head
of the agency, in consultation with the Director of the Of-
fice of Management and Budget and the Secretary of the
Treasury, determines that the sale is not in the best finan-
cial interests of the United States. Such debts shall be
audited annually in accordance with generally accepted
audit standards.
(d) LIMITATIONS.—(1) The head of an executive, ju-
dicial, or legislative agency shall not, without the approval
of the Attorney General, sell any debt that is the subject
of an allegation of or investigation for fraud, or that has
been referred to the Department of Justice for litigation.
(2) The head of an executive, judicial, or legislative
agency may exempt from sale any class of debts if the
head of the agency determines that the sale would inter-
fere with the mission of the agency administering the pro-
gram under which the indebtedness was incurred.
TITLE IV—TREATMENT OF HIGH
VALUE NONTAX DEBTS
SEC. 401. ANNUAL REPORT ON HIGH VALUE NONTAX
DEBTS.
(a) IN GENERAL.—Not later than 90 days after the
end of each fiscal year, the head of each agency that ad-
ministers a program that gives rise to a delinquent high
value nontax debt shall submit a report to Congress that
lists each such debt.
(b) CONTENT.—A report under this section shall, for
each debt listed in the report, include the following:
(1) The name of each person liable for the debt,
including, for a person that is a company, coopera-
tive, or partnership, the names of the owners and
principal officers.
(2) The amounts of principal, interest, and pen-
alty comprising the debt.
(3) The actions the agency has taken to collect
the debt, and prevent future losses.
(4) Specification of any portion of the debt that
has been written-down administratively or due to a
bankruptcy proceeding.
(5) An assessment of why the borrower de-
faulted.
(c) DEFINITIONS.—In this subsection:
(1) AGENCY; DEBT.—Each of the terms ‘‘agen-
cy’’ and ‘‘debt’’ has the meaning that term has in
chapter 37 of title 31, United States Code, as
amended by this Act.
(2) HIGH
VALUE
NONTAX
DEBT.—The term
‘‘high value nontax debt’’ means a nontax debt hav-
ing an outstanding value (including principal, inter-
est, and penalties) that exceeds $1,000,000.
SEC. 402. REVIEW BY INSPECTORS GENERAL.
(a) INSPECTOR GENERAL REPORTS.—The Inspector
General of each agency shall review the annual report to
Congress required in section 401 and make such rec-
ommendations as necessary to improve performance of the
agency. Each Inspector General shall periodically review
and report to Congress on the agency’s debt collection
management practices. As part of such reviews, the In-
spector General shall examine agency efforts to reduce the
aggregate amount of high value nontax debts that are re-
solved in whole or in part by compromise, default, or bank-
ruptcy.
(b) REPORT BY THE PRESIDENT’S COUNCIL ON IN-
TEGRITY AND EFFICIENCY.—Not later than 270 days
after the end of each fiscal year, the President’s Council
on Integrity and Efficiency shall submit a report to the
Committee on Government Reform and Oversight of the
House of Representatives and the Committee on Govern-
mental Affairs of the Senate which summarizes the re-
views conducted by the inspector general under this sec-
tion. Notwithstanding the preceding sentence, the Chair-
man of the President’s Council on Integrity and Efficiency
may submit such report in conjunction with an annual re-
port on the collection of debts owed to the United States.
SEC. 403. REQUIREMENT TO SEEK SEIZURE AND FORFEIT-
URE OF ASSETS SECURING HIGH VALUE
NONTAX DEBT.
The head of an agency authorized to collect a high
value nontax debt that is delinquent shall, when appro-
priate, promptly seek seizure and forfeiture of assets
pledged to the United States in any transaction giving rise
to the nontax debt. When an agency determines that sei-
zure or forfeiture is not appropriate, the agency shall in-
clude a justification for such determination in the report
under section 401.
TITLE V—FEDERAL PAYMENTS
SEC. 501. TRANSFER OF RESPONSIBILITY TO SECRETARY
OF 
THE 
TREASURY 
WITH 
RESPECT 
TO
PROMPT PAYMENT.
(a) DEFINITION.—Section 3901(a)(3) of title 31,
United States Code, is amended by striking ‘‘Director of
the Office of Management and Budget’’ and inserting
‘‘Secretary of the Treasury’’.
(b) INTEREST.—Section 3902(c)(3) of title 31,
United States Code, is amended by striking ‘‘Director of
the Office of Management and Budget’’ and inserting
‘‘Secretary of the Treasury’’.
(c) REGULATIONS.—Section 3903(a) of title 31,
United States Code, is amended by striking ‘‘Director of
the Office of Management and Budget’’ and inserting
‘‘Secretary of the Treasury’’.
(d) REPORTS.—Section 3906(a)(1) of title 31, United
States Code, is amended by striking ‘‘Director of the Of-
fice of Management and Budget’’ each place it appears
and inserting ‘‘Secretary of the Treasury’’.
SEC. 502. PROMOTING ELECTRONIC PAYMENTS.
(a) EARLY RELEASE OF ELECTRONIC PAYMENTS.—
Section 3903(a) of title 31, United States Code, is amend-
ed—
(1) by amending paragraph (1) to read as fol-
lows:
‘‘(1) provide that the required payment date
is—
‘‘(A) the date payment is due under the
contract for the item of property or service pro-
vided; or
‘‘(B) no later than 30 days after a proper
invoice for the amount due is received if a spe-
cific payment date is not established by con-
tract;’’; and
(2) by striking ‘‘and’’ after the semicolon at the
end of paragraph (8), by striking the period at the
end of paragraph (9) and inserting ‘‘; and’’, and by
adding at the end the following:
‘‘(10) provide that the Secretary of the Treas-
ury may waive the application of requirements under
paragraph (1) to provide for early payment of ven-
dors in cases where an agency will implement an
electronic payment technology which improves agen-
cy cash management and business practice.’’.
(b) AUTHORITY
TO
ACCEPT
ELECTRONIC
PAY-
MENT.—
(1) IN GENERAL.—Subject to an agreement be-
tween the head of an executive agency and the appli-
cable financial institution or institutions based on
terms acceptable to the Secretary of the Treasury,
the head of such agency may accept an electronic
payment, including debit and credit cards, to satisfy
a debt owed to the agency.
(2) GUIDELINES FOR AGREEMENTS REGARDING
PAYMENT.—The Secretary of the Treasury shall de-
velop guidelines regarding agreements between agen-
cies and financial institutions under paragraph (1).
Passed the House of Representatives October 14,
1998.
Attest:
Clerk.