officer of the agency. The deputy chief financial officer
may not redelegate such authority.
‘‘(d) As used in this section, the term ‘nontax debt’
means any debt other than a debt under the Internal Rev-
enue Code of 1986 or the Tariff Act of 1930.’’.
(b) CLERICAL AMENDMENT.—The table of sections
at the beginning of chapter 37 of title 31, United States
Code, is amended by striking the item relating to section
3720B and inserting the following:
‘‘3720B. Barring delinquent Federal debtors from obtaining Federal benefits.’’.
(c) CONSTRUCTION.—The amendment made by this
section shall not be construed as altering or superseding
the provisions in section 525 of title 11, United States
Code.
SEC. 203. COLLECTION AND COMPROMISE OF NONTAX
DEBTS AND CLAIMS.
(a) USE OF PRIVATE COLLECTION CONTRACTORS
AND FEDERAL DEBT COLLECTION CENTERS.—Para-
graph (5) of section 3711(g) of title 31, United States
Code, is amended to read as follows:
‘‘(5)(A) Nontax debts referred or transferred under
this subsection shall be serviced, collected, or com-
promised, or collection action thereon suspended or termi-
nated, in accordance with otherwise applicable statutory
requirements and authorities.
‘‘(B) The head of each executive agency that operates
a debt collection center may enter into an agreement with
the Secretary of the Treasury to carry out the purposes
of this subsection.
‘‘(C) The Secretary of the Treasury shall—
‘‘(i) maintain a schedule of private collection
contractors and debt collection centers operated by
agencies that are eligible for referral of claims under
this subsection;
‘‘(ii) maximize collections of delinquent nontax
debts by referring delinquent nontax debts promptly;
‘‘(iii) maintain competition between private col-
lection contractors;
‘‘(iv) ensure, to the maximum extent prac-
ticable, that a private collection contractor to which
a nontax debt is referred is responsible for any ad-
ministrative costs associated with the contract under
which the referral is made.
‘‘(D) As used in this paragraph, the term ‘nontax
debt’ means any debt other than a debt under the Internal
Revenue Code of 1986 or the Tariff Act of 1930.’’.
(b) LIMITATION ON DISCHARGE BEFORE USE OF
PRIVATE COLLECTION CONTRACTOR OR DEBT COLLEC-
TION CENTER.—Paragraph (9) of section 3711(g) of title
31, United States Code, is amended—
(1) by redesignating subparagraphs (A) through
(H) as clauses (i) through (viii);
(2) by inserting ‘‘(A)’’ after ‘‘(9)’’;
(3) in subparagraph (A) (as designated by
paragraph (2) of this subsection) in the matter pre-
ceding clause (i) (as designated by paragraph (1) of
this subsection), by inserting ‘‘and subject to sub-
paragraph (B)’’ after ‘‘as applicable’’; and
(4) by adding at the end the following:
‘‘(B)(i) The head of an executive, judicial, or legisla-
tive agency may not discharge a nontax debt or terminate
collection action on a nontax debt unless the debt has been
referred to a private collection contractor or a debt collec-
tion center, referred to the Attorney General for litigation,
sold without recourse, administrative wage garnishment
has been undertaken, or in the event of bankruptcy, death,
or disability.
‘‘(ii) The head of an executive, judicial, or legislative
agency may waive the application of clause (i) to any
nontax debt, or class of nontax debts if the head of the
agency determines that the waiver is in the best interest
of the United States.
‘‘(iii) As used in this subparagraph, the term ‘nontax
debt’ means any debt other than a debt under the Internal
Revenue Code of 1986 or the Tariff Act of 1930.’’.
TITLE 
III—SALE 
OF 
NONTAX
DEBTS 
OWED 
TO 
UNITED
STATES
SEC. 301. AUTHORITY TO SELL NONTAX 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 nontax debt sales in
order to—
(1) minimize the loan and nontax debt port-
folios of the agency;
(2) improve credit management while serving
public needs;
(3) reduce delinquent nontax debts held by the
agency;
(4) obtain the maximum value for loan and
nontax 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 nontax debt
pursuant to this section may be deducted from the pro-
ceeds received from the sale. Such costs may include, but
are not limited to—
(A) the costs of any contract for identification,
billing, or collection services;
(B) the costs of contractors assisting in the sale
of nontax debt;
(C) the fees of appraisers, auctioneers, and re-
alty brokers;
(D) the costs of advertising and surveying; and
(E) other reasonable costs incurred by the
agency.
(3) Sales of nontax 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 nontax
debt, other than with respect to a residuary equity,
joint venture, or profit participation under subpara-
graph (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, nontax debts, or other assets.
SEC. 302. REQUIREMENT TO SELL CERTAIN NONTAX
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 nontax debt becomes
24 months delinquent; or
(2) 24 months after referral of the nontax 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 NONTAX DEBTS AFTER TERMINATION
OF COLLECTION 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 nontax debts owed to the United States
unless the head of the agency, in consultation with the
Director of the Office of Management and Budget and the
Secretary of the Treasury, determines that the sale is not
in the best financial interests of the United States. Such
nontax 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 nontax 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 nontax debts
if the head of the agency determines that the sale would
interfere with the mission of the agency administering the
program 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 section:
(1) AGENCY.—The term ‘‘agency’’ 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.
The Inspector General of each agency shall review the
annual report to Congress required in section 401 and
make such recommendations as necessary to improve per-
formance of the agency. Each Inspector General shall peri-
odically review and report to Congress on the agency’s
nontax debt collection management practices. As part of
such reviews, the Inspector General shall examine agency
efforts to reduce the aggregate amount of high value
nontax debts that are resolved in whole or in part by com-
promise, default, or bankruptcy.
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. 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 Director of the Office of
Management and Budget may waive the application
of requirements under paragraph (1) to provide for
early payment of vendors in cases where an agency
will implement an electronic payment technology
which improves agency cash management and busi-
ness 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 Director of the Office of
Management and Budget, the head of such agency
may accept an electronic payment, including debit
and credit cards, to satisfy a nontax debt owed to
the agency.
(2) GUIDELINES FOR AGREEMENTS REGARDING
PAYMENT.—The Director of the Office of Manage-
ment and Budget shall develop guidelines regarding
agreements between agencies and financial institu-
tions under paragraph (1).
Passed the House of Representatives October 20,
1998.
Attest:
Clerk.