National Labor Relations Board (NLRB).
The National Labor Relations Board (NLRB) is issuing final regulations concerning the procedures used to collect debts that are owed to the NLRB. These final regulations conform to the legislative changes enacted in the Debt Collection Improvement Act of 1996 (DCIA) and the amended procedures presented in the Federal Claims Collection Standards (FCCS) issued by the Department of the Treasury (Treasury) and the Department of Justice (DOJ). This final action is intended to improve the NLRB's collection of debts owed to the United States.
July 23, 2007.Start Further Info
FOR FURTHER INFORMATION CONTACT:
Karl Rohrbaugh, Chief, Finance Branch, National Labor Relations Board, Room 7828, 1099 14th Street, NW., Washington, DC 20570-0001, Telephone (202) 273-4226, e-mail address Karl.Rohrbaugh@nlrb.gov.End Further Info End Preamble Start Supplemental Information
On April 26, 1996, the Debt Collection Improvement Act (DCIA) of 1996 (Pub. L. 104-134) was enacted. This Act enhances the Federal Government's debt collection activities. The purposes of the Act are—
(1) To maximize collections of delinquent debts owed to the Government by ensuring quick action to enforce recovery of debts and the use of all appropriate collection tools,
(2) To minimize the costs of debt collection by consolidating related functions and activities and using interagency teams,
(3) To reduce losses arising from debt management activity by requiring proper screening of potential borrowers, aggressive monitoring of all accounts, and sharing of information within and among Federal agencies,
(4) To ensure that the public is fully informed of the Federal Government's debt collection policies and that debtors are aware of their obligations to repay amounts owed to the Federal Government,
(5) To ensure that debtors have all appropriate due process rights, including the ability to verify, challenge, and compromise claims, and access to administrative appeals procedures which are both reasonable and protect the interests of the United States,
(6) To encourage agencies, when appropriate, to sell delinquent debt, particularly debts with underlying collateral, and
(7) To rely on the experience and expertise of private sector professionals to provide debt collection services to Federal agencies.
This act provides that any nontax debt or claim owed to the United States that has been delinquent for a period of 180 days shall be referred to the Department of the Treasury or a Treasury-designated collection center for appropriate action to collect or terminate collection of the claim or debt. The DCIA provides the Treasury with new collection tools, including the authority to offset any Federal agency's payment to a vendor to satisfy that vendor's debt.
The Federal Claims Collection Standards (FCCS) (31 CFR Chapter IX Parts 900, 901, 902, 903, and 904) were revised November 22, 2000 (65 FR 70390). The revised FCCS clarify and simplify Federal debt collection procedures and reflect changes under the DCIA of 1996 and the General Accounting Office Act of 1996. The revised FCCS reflect legislative changes to Federal debt collection procedures enacted under the Debt Collection Improvement Act of 1996 (DCIA), Public Law 104-134, 110 Stat. 1321-358, as part of the Omnibus Consolidated Recissions and Appropriations Act of 1996. The revised FCCS provide agencies with greater latitude to adopt agency-specific regulations, tailored to the legal and policy requirements applicable to various types of Federal debt, to maximize the effectiveness of Federal debt collection procedures.
The Department of the Treasury and the Department of Justice published the revised FCCS as a joint final rule under Chapter IX, Title 31, Code of Federal Regulations. These regulations superseded the FCCS regulations codified at 4 CFR Chapter II Parts 101-105.
The revised FCCS prescribe standards for Federal agency use in the administrative collection, offset, compromise, and the suspension or termination of collection activity for civil claims for money, funds, or property as defined by 31 U.S.C. 3701(b), unless specific Federal agency statutes or regulations apply to such activities, or as provided for by Title 11 of the United States Code when the claims involve bankruptcy. The revised FCCS also prescribe standards for referring debts to the Department of Justice for litigation.
These regulations cover the collection of debts such as court costs, vendor overpayments, travel-related expenses, etc. However, currently, the majority of the debts owed to the NLRB are payroll debts owed by current or former employees, the collection of which are covered under 5 U.S.C. 5514.
II. Comments on Interim Rule
On August 18, 2006 (71 FR 47732), the NLRB published an interim rule with a request for comments concerning its procedures used to collect debts owed to the NLRB. The comment period expired on October 17, 2006. No comments were received with respect to the interim rule.
III. Administrative Procedures Act
Because this rule involves rules of agency organization, procedure, or practice, no notice of proposed rulemaking is required under Section 553 of the Administrative Procedures Act (5 U.S.C. 553).Start Printed Page 40070
IV. Regulatory Flexibility Act
Because no notice of proposed rulemaking is required for procedural rules, the requirements of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) pertaining to regulatory flexibility analysis do not apply to these rules. However, even if the Regulatory Flexibility Act were to apply, the NLRB certifies that this interim rule will not have a significant impact on small businesses, state and local governments and geographical regions; health, safety; and the environment.
V. Small Business Regulatory Enforcement Fairness Act
Because the interim rule relates to agency procedure and practice, the NLRB has determined that the Congressional review provisions of the Small Business Regulatory Enforcement Fairness Act (5 U.S.C. 801 et seq.) do not apply.
VI. Paperwork Reduction Act
This interim rule does not impose any reporting or record keeping requirements under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.).Start List of Subjects
List of Subjects in 29 CFR Part 100End List of Subjects Start Amendment Part
For the reasons set forth in the preamble, the National Labor Relations Board amendsEnd Amendment Part Start Part
PART 100—ADMINISTRATIVE REGULATIONSEnd Part Start Amendment Part
1. The authority citation for part 100 is revised to read as follows:End Amendment Part
Subpart A is also issued under 5 U.S.C. 7301.
Subpart B is also issued under the Inspector General Act of 1976, as amended by the Inspector General Act Amendments of 1988, 5 U.S.C. ap3; 42 U.S.C. 2000e-16(a).
Subpart E is also issued under 29 U.S.C. 794.Start Amendment Part
2. Subpart F is revised to read as follows:End Amendment Part
Subpart F—Debt Collection Procedures
- Purpose and scope.
- Debts that are covered.
- Monetary limitations on NLRB's authority.
- Information Collection Requirements: OMB Approval.
- No private rights created.
- Form of payment.
- Subdivision of claims or debts.
- Administrative collection of claims.
- Written demand for payment.
- Reporting claims or debts.
- Disputed claims or debts.
- Contracting for collection services.
- Collection by administrative offset.
- Authorities other than offset.
- Payment collection.
- Interest, penalties, and administrative costs.
- Bankruptcy claims.
- When a debt may be compromised.
- Finality of a compromise.
- When collection action may be terminated or suspended.
- Termination of collection action.
- Exception to termination.
- Discharge of indebtedness; reporting requirements.
- Referral of a claim to the Department of Justice.
This part prescribes standards and procedures for officers and employees of the National Labor Relations Board (NLRB) who are responsible for the collection and disposition of certain debts owed to the United States, as further defined below. The authority for this part is the Federal Claims Collection Act of 1966; the Debt Collection Improvement Act of 1996; 31 U.S.C. 3711 and 3716 through 3719, as amended; The Federal Claims Collection Standards, 31 CFR Chapter IX Parts 900-904; and Office of Management and Budget Circular A-129. The activities covered include: the collection of claims of any amount; compromising claims; suspending or terminating the collection of claims; referring debts that are more than 180 days delinquent to the Department of the Treasury for collection action; and the referral of debts of more than $100,000 (exclusive of any interest and charges) to the Department of Justice for litigation.
For the purpose of this subpart, the following definitions will apply:
Administrative Offset means withholding money payable by the United States Government (including money payable by the United States Government on behalf of a State Government) to, or held by the Government for, a person to satisfy a debt the person owes the United States Government.
Centralized offset means the offset of Federal payments through the Treasury Offset Program to collect debts which creditor agencies have certified pursuant to 31 U.S.C. 3716(c), 3720A(a) and applicable regulations. The term “centralized offset” includes the Treasury Offset Program's processing of offsets of Federal payments disbursed by disbursing officials other than the Department of the Treasury.
Claim or debt means an amount of money, funds, or property that has been determined by an agency official to be owed to the United States by a person, organization, or entity, except another Federal agency. For the purposes of administrative offset under 31 U.S.C. 3716, the terms claim and debt include an amount of money, funds, or property owed by a person to a State (including past-due support being enforced by a State), the District of Columbia, American Samoa, Guam, the United States Virgin Islands, the Commonwealth of the Northern Mariana Islands, or the Commonwealth of Puerto Rico.
Cross-servicing means that the Department of the Treasury or another debt collection center is taking appropriate debt collection action on behalf of one or more Federal agencies or a unit or sub-agency thereof.
Debtor means an individual, organization, group, association, partnership, or corporation indebted to the United States, or the person or entity with legal responsibility for assuming the debtor's obligation.
Delinquent refers to the status of a debt and means a debt has not been paid by the date specified in the initial written demand for payment or applicable contractual agreement with the NLRB, unless other satisfactory payment arrangements have been made by that date. If the debtor fails to satisfy obligations under a payment agreement with the NLRB after other payment arrangements have been made, the debt becomes a delinquent debt.
Payment in full means payment of the total debt due the United States, including any interest, penalty, and administrative costs of collection assessed against the debtor.
Recoupment is a special method for adjusting debts arising under the same transaction or occurrence. For example, obligations arising under the same contract generally are subject to recoupment.
(a) The procedures covered by this part generally apply to claims for payment or debts which Start Printed Page 40071
(1) Result from certain internal management activities of the NLRB; or
(2) Are referred to the NLRB for collection.
(b) The procedures covered by this part do not apply to
(1) A debt arising from, or ancillary to, any action undertaken by or on behalf of the NLRB or its General Counsel in furtherance of efforts to ensure compliance with the National Labor Relations Board Act, 29 U.S.C. Section 151, et seq., including but not limited to actions involving the collection of monies owed for back pay and/or other monetary remedies provided for in Board orders or ancillary court proceedings. (Regulations concerning the collection of these types of debts are found in 29 CFR Part 102, Subparts U and V.);
(2) A debt involving criminal actions of fraud, the presentation of a false claim, or misrepresentation on the part of the debtor or any other person having an interest in the claim;
(3) A debt based in whole or in part on conduct in violation of the antitrust laws;
(4) A debt under the Internal Revenue Code of 1986;
(5) A debt between Federal agencies. Federal agencies should attempt to resolve interagency claims by negotiation in accordance with Executive Order 12146 (3 CFR, 1980 Comp., pp. 409-412);
(6) A debt once it becomes subject to salary offset under 5 U.S.C. 5514; or
(7) A debt involving bankruptcy which is covered by Title 11 of the United States Code.
(c) Debts involving criminal actions of fraud, false claims, misrepresentation, or which violate antitrust laws will be promptly referred to the Department of Justice. Only the Department of Justice has the authority to compromise, suspend, or terminate collection activity on such debts. However, at its discretion, the Department of Justice may return a debt to the NLRB for further handling.
The NLRB's authority to compromise a debt or to suspend or terminate collection action on a debt covered by these procedures is limited by 31 U.S.C. 3711(a) to claims that:
(a) Have not been referred to another Federal Agency for further collection actions; and
(b) Do not exceed $100,000 (exclusive of any interest) or such higher amount as the Attorney General shall from time to time prescribe for purposes of compromise or suspension or termination of collection activity.
This part contains no information collection requirements, and, therefore, is not subject to the requirements of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.)
(a) The failure of the NLRB to include in this part any provision of the Federal Collections Claim Standards (FCCS), 31 CFR Chapter IX Parts 900-904, does not prevent the NLRB from applying these provisions.
(b) A debtor may not use the failure of the NLRB to comply with any provision of this part or of the FCCS as a defense.
These procedures are directed primarily at the recovery of money or, when a contractual basis exists, the NLRB may demand the return of specific property or the performance of specific services.
The NLRB shall aggressively collect all claims or debts. These collection activities will be undertaken promptly and follow up action will be taken as appropriate in accordance with 31 CFR Chapter IX § 901.1.
(a) The NLRB will promptly make written demand upon the debtor for payment of money or the return of specific property. The written demand for payment will be consistent with the requirements of 31 CFR Chapter IX § 901.2. The date by which payment is due to avoid any late charges will be 60 days from the date that the demand letter is mailed or hand-delivered.
(b) The failure to state in a letter of demand a matter described in 31 CFR Chapter IX § 901.2 is not a defense for a debtor and does not prevent the NLRB from proceeding with respect to that matter.
(c) When necessary, to protect the Government's interest, written demand may be preceded by other appropriate action, including immediate referral for litigation. It may be appropriate to contact a debtor or his representative or guarantor by other means (telephone, in person, etc.) to discuss prompt payment, the debtor's ability to repay the debt, and to inform the debtor of his rights and the affect of nonpayment or delayed payment.
(d) When the NLRB learns that a bankruptcy petition has been filed with respect to a debtor, the NLRB will cease collection action immediately unless it has been determined that the automatic stay imposed at the time of filing pursuant to 11 U.S.C. 362 has been lifted or is no longer in effect.
(a) In addition to assessing interest, penalties, and administrative costs pursuant to 31 CFR Chapter IX § 901.9, the NLRB may report a debt that has been delinquent for 90 days to a consumer reporting agency in accordance with the requirements of 31 U.S.C. 3711(e).
(b) The information the NLRB discloses to a consumer reporting agency is limited to—
(1) Information necessary to establish the identity of the individual debtor, including name, address, and taxpayer identification number;
(2) The amount, status, and history of the debt; and
(3) The NLRB activity under which the debt arose.
(a) A debtor who disputes a debt should provide the NLRB with an explanation as to why the debt is incorrect within 60 days from the date the initial demand letter was mailed or hand-delivered. The debtor may support the explanation by affidavits, cancelled checks, or other relevant evidence.
(b) If the debtor's arguments appear to have merit, the NLRB may waive the interest period pursuant to 29 CFR 100.617(c) pending a final determination of the existence or the amount of the debt.
(c) The NLRB may investigate the facts concerning the dispute and, if it considers it necessary, arrange for a conference at which the debtor may present evidence and any arguments in support of the debtor's position.
The NLRB may contract for collection services in order to recover delinquent debts only if the debts are not subject to the DCIA requirement to transfer claims or debts to Treasury for debt collection services, e.g., claims or debts of less than 180 days delinquent. However, the NLRB retains the authority to resolve disputes, compromise claims, suspend or terminate collection action, and initiate enforced collection through litigation. When appropriate, the NLRB shall contract for collection services in Start Printed Page 40072accordance with guidance and standards contained in 31 CFR Chapter IX Parts 900-904.
(a) Application. (1) The NLRB may administratively undertake collection by centralized offset on each claim which is liquidated or certain in amount in accordance with the guidance and standards in 31 CFR Chapter IX Parts 900-904 and 5 U.S.C. 5514.
(2) This section does not apply to those debts described in 31 CFR Chapter IX § 901.3(a)(2).
(3) Unless otherwise provided for by contract or law, debts or payments that are not subject to administrative offset under 31 U.S.C. 3716 may be collected by administrative offset under the common law or other applicable statutory authority.
(4) Generally, administrative offset of payments under the authority of 31 U.S.C. 3716 may not be conducted more than 10 years after the Government's right to collect the claim or debt first accrued.
(b) Mandatory Centralized Offset. (1) The NLRB is required to refer past due legally enforceable, nontax debts that are over 180 days delinquent to the Department of the Treasury for collection by centralized administrative offset. A debt is legally enforceable if there has been a final determination by the NLRB that the debt, in the amount stated, is due and there are no legal bars to collection action. Debts under this section will be referred and collected pursuant to procedures in 31 CFR Chapter IX § 901.3(b).
(c) NLRB administrative offset. The NLRB, in order to refer a delinquent debt to the Department of the Treasury for administrative offset, adopts the administrative offset procedures as prescribed by 31 CFR Chapter IX § 901.3.
(d) Non-centralized administrative offset. Generally, non-centralized administrative offsets are ad hoc case-by-case offsets that the NLRB would conduct at its own discretion, internally or in cooperation with the agency certifying or authorizing payments to the debtor. Non-centralized administrative offset is used when centralized administrative offset is not available or appropriate to collect past due legally enforceable, nontax delinquent debts. In these cases, the NLRB may make a request directly to a payment-authorizing agency to offset a payment due a debtor to collect a delinquent debt. The NLRB adopts the procedures in 31 CFR Chapter IX § 901.3(c) so that it may request that the Department of the Treasury or any other payment authorizing agency to conduct a non-centralized administrative offset.
(e) Requests to OPM to offset a debtor's anticipated or future benefit payments under the Civil Service Retirement and Disability Fund and the Federal Employees Retirement System. Upon providing OPM written certification that a debtor has been afforded the procedures provided for in this section, the NLRB will request that OPM offset a debtor's anticipated or future benefit payments under the Civil Service Retirement and Disability Fund (Fund) in accordance with regulations codified at 5 CFR 831.1801-831.1808 and the Federal Employees Retirement System (System) in accordance with regulations codified at 5 CFR 845.401-845.408. Upon receipt of a request, OPM will identify and “flag” a debtor's account in anticipation of the time when the debtor requests or becomes eligible for payments from the Fund or System. This will satisfy any requirement that offset be initiated prior to the expiration of the time limitations referenced in 29 CFR 100.614(a)(4).
(f) Review Requirements. For purposes of this section, whenever the NLRB is required to afford a debtor a review within the Agency, the NLRB shall provide the debtor with a reasonable opportunity for a review of the record in accordance with 31 CFR Chapter IX § 901.3(e). The NLRB will provide the debtor with the reasonable opportunity for an oral hearing in accordance with 31 CFR 285.11(f), when the debtor requests reconsideration of the debt, and the NLRB determines that the question of the indebtedness cannot be resolved by review of the written record, for example, when the validity of the debt turns on an issue of credibility or veracity.
(a) Administrative Wage Garnishment. The NLRB is authorized to collect debts from a debtor's wages by means of administrative wage garnishment in accordance with the requirements of 31 U.S.C. 3720D and 31 CFR 285.11. This section adopts and incorporates all of the provisions of 31 CFR 285.11 concerning administrative wage garnishment, including the hearing procedures described in 31 CFR 285.11(f). The NLRB may use administrative wage garnishment to collect a delinquent debt unless the debtor is making timely payments under an agreement to pay the debt in installments.
(b) This section does not apply to Federal salary offset, the process by which the NLRB collects debts from the salaries of Federal employees.
(a) The NLRB shall make every effort to collect a claim in full before it becomes delinquent, but will consider arranging for payment in regular installments consistent with 31 CFR Chapter IX § 901.8, if the debtor furnishes satisfactory evidence that he is unable to pay the debt in one lump sum. Except for a claim described in 5 U.S.C. 5514, all installment payment arrangements must be in writing and require the payment of interest, penalties, and other administrative costs. If possible, the installment payments should be sufficient in size and frequency to liquidate the debt in three years or less.
(b) If a debt is paid in one lump sum after it becomes delinquent, the NLRB shall impose charges for interest, penalties, and administrative costs as specified in 31 CFR Chapter IX § 901.9.
(c) Payment of a debt is made by check, electronic funds transfer, draft, or money order payable to the National Labor Relations Board. Payment should be made to the National Labor Relations Board, Finance Branch, 1099 14th Street NW., Washington, DC 20570, unless payment is—
(1) Made pursuant to arrangements with the Department of Justice;
(2) Ordered by a Court of the United States; or
(3) Otherwise directed in any other part of this chapter.
(a) Pursuant to 31 U.S.C. 3717, the NLRB shall assess interest, penalties, and administrative costs on debts owed to the United States Government. Interest, penalties, and administrative costs will be assessed in accordance with the provisions contained in 31 CFR Chapter IX § 901.9.
(b) The NLRB shall waive collection of interest on a debt or any portion of the debt which is paid in full within 30 days after the date on which the interest began to accrue.
(c) The NLRB may waive interest during a period a disputed debt is under investigation or review by the NLRB. However, this additional waiver is not automatic and must be requested before the expiration of the initial 30-day waiver period. The NLRB may grant the additional waiver only if it finds merit in the explanation the debtor has submitted.
(d) The NLRB may waive collection of interest, penalties, and administrative costs if it finds that one or more of the following conditions exist: Start Printed Page 40073
(1) The debtor is unable to pay any significant sum toward the debt within a reasonable period of time;
(2) Collection of interest, penalties, and administrative costs will jeopardize collection of the principal of the debt;
(3) The NLRB is unable to enforce collection in full within a reasonable period of time by enforced collection proceedings; or
(4) Collection is not in the best interest of the United States, including when an administrative offset or installment agreement is in effect.
(e) The NLRB is authorized to impose interest and related charges on debts not subject to 31 U.S.C. 3717, in accordance with common law.
When the NLRB learns that a bankruptcy petition has been filed by a debtor, before proceeding with further collection action, the NLRB will immediately seek legal advice from the NLRB's Office of Special Counsel concerning the impact of the Bankruptcy Code on any pending or contemplated collection activities. After seeking legal advice from the NLRB's Office of Special Counsel, the NLRB will take any necessary action in accordance with the provisions of 31 CFR Chapter IX § 901.2(h).
The NLRB may compromise a debt not in excess of the monetary limitation in accordance with 31 CFR Chapter IX part 902 if it has not been referred to the Department of Justice for litigation.
An offer of compromise must be in writing and signed by the debtor. An offer of compromise which is accepted by the NLRB is final and conclusive on the debtor and on all officials, agencies, and courts of the United States, unless obtained by fraud, misrepresentation, the presentation of a false claim, or mutual mistake of fact.
The NLRB may suspend or terminate collection action on a claim not in excess of the monetary limitation of $100,000 or such other amount as the Attorney General may direct, exclusive of interest, penalties, and administrative costs, after deducting the amount of partial payments or collections, if any, in accordance with the standards and reasons set forth in 31 CFR Chapter IX part 903.
Before terminating collection activity, the NLRB will have pursued all appropriate means of collection and determined, based upon results of the collection activity, that the debt is uncollectible. Termination of collection activity ceases active collection of the debt. The termination of collection activity does not preclude the NLRB from retaining a record of the account for the purposes stated in 31 CFR Chapter IX § 903.3(b) and (c).
If a debt meets the exceptions described in 31 CFR Chapter IX § 903.4, the NLRB may refer it for litigation even though termination of collection activity may otherwise be appropriate.
(a) Before discharging a delinquent debt (also referred to as close-out of a debt), the NLRB shall take all appropriate steps to collect the debt in accordance with 31 U.S.C. 3711(g), including, as applicable, administrative offset, tax refund offset, Federal salary offset, referral to Treasury or Treasury-designated collection centers or private collection contractors, credit bureau reporting, wage garnishment, litigation, and foreclosure. Discharge of indebtedness is distinct from termination or suspension of collection activity and is governed by the Internal Revenue Code. When the NLRB determines that it will discharge a debt, it will do so in accordance with the provisions of 31 CFR Chapter IX § 903.5.
The NLRB shall promptly refer debts that are subject to aggressive collection activity and that cannot be compromised, or debts on which collection activity cannot be suspended or terminated, to the Department of Justice for litigation. Debts shall be referred as early as possible, consistent with the standards contained if 31 CFR Chapter IX parts 900-904 and, in any event, well within the period for initiating timely lawsuits against the debtors. The NLRB will make every effort to refer delinquent debts to the Department of Justice within one year of the date such debts became delinquent.
By Direction of the Board.
Dated in Washington, DC July 12, 2007.
Lester A. Heltzer,
[FR Doc. E7-13802 Filed 7-20-07; 8:45 am]
BILLING CODE 7545-01-P