Debt Collection Procedures
[Federal Register: May 6, 2002 (Volume 67, Number 87)]
[Rules and Regulations]
[Page 30315-30324]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr06my02-1]
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NUCLEAR REGULATORY COMMISSION
10 CFR Part 15
RIN 3150-AG80
Debt Collection Procedures
AGENCY: Nuclear Regulatory Commission.
ACTION: Final rule.
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SUMMARY: The Nuclear Regulatory Commission (NRC) is amending its
regulations concerning the procedures used to collect debts that are
owed to NRC. These amendments will conform NRC regulations 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 allow the NRC to improve its collection of debts due the
United States.
EFFECTIVE DATE: June 5, 2002.
FOR FURTHER INFORMATION CONTACT: Leah Tremper, Office of the Chief
Financial Officer, U.S. Nuclear Regulatory Commission, 11545 Rockville
Pike, Rockville, MD 20852-2738, Telephone 301-415-7347.
SUPPLEMENTARY INFORMATION:
I. Background
II. Comments on Proposed Rule
III. Section by Section Analysis
IV. Voluntary Consensus Standards
V. Finding of No Significant Environmental Impact
VI. Paperwork Reduction Act
VII. Regulatory Analysis
VIII. Regulatory Flexibility Certification
IX. Backfit Analysis
I. Background
On August 9, 1990 (55 FR 32375), the Nuclear Regulatory Commission
(NRC) published a final rule concerning debt collection procedures.
Since then, the DCIA Act (DCIA) of 1996 (Pub. L. 104-134), was enacted
on April 26, 1996. This Act enhances debt collection Government-wide.
The purposes of this 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 utilizing interagency teams,
(3) To reduce losses arising from debt management activities 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 cognizant 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 Treasury or Treasury-designated collection center for
appropriate action to collect or terminate collection action on the
debt or claim. The DCIA of 1996 has expanded the collection tools
available through administrative offset.
One of the most significant provisions of the DCIA of 1996 is the
requirement that most agency debt over 180 days delinquent be referred
to the Treasury for collection. The DCIA of 1996 provides Treasury with
new collection tools, including the authority to offset any Federal
agency's payment to a vendor to satisfy that vendor's debt to a
different Federal agency. This capability can improve our collection
efforts as follows:
(1) It limits the amount of time spent on trying to collect from
delinquent debtors by referring a debt to Treasury when it becomes
180 days delinquent;
(2) It provides a powerful collection tool, offset of Federal
payments, that is otherwise unavailable to NRC; and
(3) It puts the debt in the hands of a professional staff that
is dedicated to handling collections.
The FCCS (31 CFR Chapter IX and parts 900, 901, 902, 903, and 904)
were revised on 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 DCIA of 1996 (DCIA), Public Law
104-134, 110 Stat. 1321-358, as part of the Omnibus Consolidated
Rescissions 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 the various
types of Federal debt, to maximize the effectiveness of Federal debt
collection procedures. The Secretary of the Treasury has been added as
a co-promulgator of the FCCS in accordance with section 31001(g)(1)(C)
of the DCIA of 1996. The Comptroller General has been removed as a co-
promulgator in accordance with section 115(g) of the General Accounting
Office Act of 1996, Public Law 104-316, 110 Stat. 3826 (October 19,
1996), (65 FR 70390 (2000)). The Treasury and DOJ have published the
revised FCCS as a joint final rule under new Chapter IX, Title 31, Code
of Federal Regulations. The revised FCCS supersede the current FCCS
codified at 4 CFR 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
[[Page 30316]]
FCCS also prescribe standards for referring debts to the DOJ for
litigation.
II. Comments on Proposed Rule
On October 5, 2001 (68 FR 50860), the NRC published a proposed rule
to amend its debt collections procedures to conform NRC regulations to
the legislative changes enacted in the DCIA of 1996 and the revised
FCCS. The comment period expired on December 19, 2001. No comments were
received on the proposed rule.
III. Section by Section Analysis
Section 15.1 Application
The DCIA of 1996 requires all Federal agencies to refer delinquent
debt that is over 180 days old to Treasury for offset and collection.
This section is amended to reflect that the NRC is not limited to
collection remedies contained in the revised FCCS, and eliminate the
GAO's role as co-promulgator of the FCCS.
Section 15.2 Definitions
This section is amended to expand the definition of ``claim or
debt'' to conform with the DCIA of 1996. Other definitions such as
``administrative wage garnishment,'' ``cross-servicing,'' ``Federal
agencies,'' ``recoupment,'' ``tax refund offset,'' ``Treasury,'' and
``withholding order'' have been added to conform to the definitions in
the DCIA of 1996.
Section 15.5 Claims That Are Covered
This section is amended to include reference to Executive Order
12146, which references interagency resolution of disputes, to exclude
specifically from coverage a claim under the Internal Revenue Code of
1986, and to add claims that involve bankruptcy are covered by Title 11
of the United States Code.
Section 15.7 Monetary Limitation on NRC's Authority
This section is amended to increase NRC's authority to compromise a
claim or to terminate or suspend collection action on a claim covered
by these procedures to $100,000 to reflect the ceiling change
established by 31 U.S.C. 3711(a)(2) and to delete reference to the GAO.
Section 15.8 Information Collection Requirements: OMB approval
This section is added to state that this part contains no
information collection requirements and is not subject to the
requirements of the Paperwork Reduction Act.
Section 15.9 No Private Rights Created
This section is amended to change the section heading from
``Omission not a defense'' to ``No private rights created'' and delete
the reference to 4 CFR part 101-105 and substitute the reference to 31
CFR Chapter IX, parts 900-904.
Section 15.11 Form of Payment
This section is amended to change the section heading from
``Conversion claims'' to ``Form of payment'' and allow claims to be
paid in money or property, if contractually authorized.
Section 15.20 Aggressive Agency Collection Action
This section is added to include DCIA debt collection provisions
for referral of delinquent debt to Treasury for cross-servicing, and
mandate cooperation among Federal agencies as required by the DCIA of
1996.
Section 15.21 Written Demand for Payment
This section is amended to change the number of demand letters to
be sent for each debt from three to two. The revised FCCS allows
agencies latitude to adopt agency-specific regulations and this change
in the number of demand letters reflects the latitude allowed. In
addition, the noticing requirements is amended to include the name,
address, and phone number of an NRC contact for each demand letter, to
delete the reference to 4 CFR 102.13 and 102.5 and to substitute the
reference to 31 CFR Chapter IX part 901.9 and 901.4, and to add
procedures to follow when a bankruptcy petition is filed by a debtor.
The DCIA of 1996 allows agencies greater latitude to adopt agency-
specific regulations and the change in the number of demand letters
reflects the latitude allowed.
Section 15.23 Telephone or Internet Inquiries and Investigations
This section is amended to include the use of the internet as a
means of contacting a debtor.
Section 15.26 Reporting Claims
The section heading is changed from ``Use of consumer reporting
agencies'' to ``Reporting claims.'' This section is amended to include
the due process notification to the individual debtor with the second
demand letter, and delete the requirement for sending at least one
demand letter by registered or certified mail.
Section 15.29 Suspension or Revocation of License
This section is revised to:
(1) State that the suspension or revocation of a license, permit,
or approval is also applicable to Federal programs or activities that
are administered by the states on behalf of the Federal Government; and
(2) Include that NRC will seek legal advice from its Office of the
General Counsel for those debts that involve bankruptcy before
suspending or revoking a license.
Section 15.32 Contracting for Collection Services
This section is amended to include that NRC may contract for
collection services in order to recover delinquent debts if the debts
are not subject to the DCIA requirement to transfer debts to Treasury
for debt collection services and delete the reference to 4 CFR 102.6
and substitute the reference to 31 CFR Chapter IX, part 901.5.
Section 15.33 Collection by Administrative Offset
This section is revised to include several new debt collection
procedures under the DCIA of 1996, including but not limited to--
(1) Transfer or referral of delinquent debt to the Department of
the Treasury or Treasury-designated debt collection center for
collection, known as ``cross-servicing;''
(2) Centralized administrative offset by disbursing officials;
(3) Credit bureau reporting; and
(4) Prohibition against extending Federal financial assistance in
the form of a loan or loan guarantee to delinquent debtors.
Included in this section are NRC administrative offset procedures
to be followed prior to initiating centralized and non-centralized
offsets.
Section 15.35 Payments
This section is amended to delete confess-judgment notes, delete
how payments are to be applied when there are multiple debts, include
credit cards as a payment method, and change the address where payments
are to be sent.
Section 15.37 Interest, Penalties, and Administrative Charges
This section is amended to delete reference to 4 CFR 102.2 and
102.13 and substitute the reference to 31 CFR Chapter IX, part 901.2
and 901.9 and add that NRC is authorized to impose interest and related
charges on debts not subject to 31 U.S.C. 3717, in accordance with
common law.
Section 15.39 Bankruptcy Claims
This section is amended to include procedures the NRC would follow
when
[[Page 30317]]
notified that a debtor has filed for bankruptcy protection.
Section 15.41 When a Claim May Be Compromised
This section is amended to delete reference to the GAO, clarify
that the FCCS applies to debt referred to Treasury for collection
(cross-servicing), and include procedures for referring claims that
exceed $100,000 to the DOJ for acceptance of the compromise offer.
Section 15.43 Reasons for Compromising a Claim
This section is amended to delete reference to 4 CFR 103 and 103.4
and substitute the reference to 31 CFR Chapter IX, part 902 and 902.2.
Section 15.45 Consideration of Tax Consequences to the Government
This section heading is changed from ``Restrictions on the
compromise of a claim'' to ``Consideration of tax consequences to the
Government.'' This section is amended to allow acceptance of a
percentage of a debtor's profits or stock in a debtor corporation in
compromise of a claim and reword the remainder of the section.
Section 15.49 Mutual Release of the Debtor and the Government
This section is added to include the requirement that compromises
be implemented by means of mutual release, when appropriate.
Section 15.51 When Collection Action May Be Suspended or Terminated
This section is amended to include procedures for suspending or
terminating collection action on claims over $100,000 and to eliminate
GAO's debt collection role.
Section 15.53 Reasons for Suspending Collection Action
This section is amended to prescribe factors to consider when
determining that collection action should be suspended, and when
collection activity should be suspended pending waiver or
administrative review, and to include consideration of the impact of
the Bankruptcy Code in bankruptcy cases.
Section 15.55 Reasons for Terminating Collection Action
This section is amended to combine paragraphs (a) through (c) and
add that NRC may terminate collection activity on a debt that has been
discharged in bankruptcy.
Section 15.57 Termination of Collection Action
This section is amended to add that termination does not preclude
retention of debt records for purposes of selling the debt, pursuing
collection at a subsequent date, offsetting against future income or
assets, and screening future applicants for prior indebtedness; and add
that collection activity may be terminated for debts that have been
discharged in bankruptcy.
Section 15.60 Discharge of Indebtedness; Reporting Requirements
This section is added to require the NRC to take all appropriate
collection actions and make a determination that further collection
action is not warranted before making a determination to discharge a
debt, provide that the NRC may not discharge a debt until the
requirements of 31 U.S.C. 3711(i) (sale of debt) have been met, and
provide that the NRC will report discharge of debt to the IRS on Form
1099-C.
Section 15.61 Prompt Referral
This section is amended to include revised procedures for referring
debts that are over $1,000,000 to the DOJ for litigation, include
requirements that the NRC refrain from debtor contact after referral to
DOJ, and add provisions that DOJ shall notify the NRC of any payments
received from the debtor.
Section 15.65 Referral of a Compromise Offer
This section is amended to delete reference to the GAO and include
the requirement that a written offer of compromise that is substantial
in amount be referred to DOJ using a Claims Collection Litigation
Report (CCLR) accompanied by supporting data and particulars concerning
the debt.
Section 15.67 Referral to the Department of Justice
This section is amended to add the requirement that certified
copies of documents be forwarded to DOJ with litigation referrals,
increase the minimum amount of claims to be referred to DOJ to $2,500,
and add exception for claims being referred solely to secure a judgment
for lien filing purposes.
IV. Voluntary Consensus Standards
The National Technology Transfer and Advancement Act of 1995,
Public Law 104-113, requires that Federal agencies use technical
standards that are developed or adopted by voluntary consensus
standards bodies unless using such a standard is inconsistent with
applicable law or otherwise impractical. In this final rule, the NRC is
amending part 15 to reflect the current requirements of the revised
DCIA of 1996 and the revised FCCS. This action does not constitute the
establishment of a standard that contains generally applicable
requirements.
V. Finding of No Significant Environmental Impact
The Commission has determined, under the National Environmental
Policy Act of 1969, as amended, and the Commission's regulations in
subpart A of 10 CFR part 51, that this rule, if adopted, would not be a
major Federal action significantly affecting the quality of the human
environment and, therefore, an environmental impact statement is not
required. This final rule is necessary to conform the NRC regulations
to the amended procedures presented in the revised FCCS. Amending the
procedures that the NRC uses to collect debts which are owed to it will
not have any radiological environmental impact offsite and no impact on
occupational radiation exposure onsite. The rule does not affect
nonradiological plant effluents and has no other environmental impact.
The environmental assessment and finding of no significant impact, on
which this determination is based, are available for inspection at the
NRC Public Document Room, 11555 Rockville Pike, Rockville, Maryland,
between 7:30 am and 4:15 pm except on Federal holidays.
VI. Paperwork Reduction Act
This final rule does not contain information collection
requirements and, therefore, is not subject to the requirements of the
Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.).
VII. Regulatory Analysis
The final rule conforms NRC procedures for collecting debts owed it
with the amended procedures presented in the FCCS and the DCIA of 1996,
and, as such, will not have a significant impact on state and local
governments and geographical regions; health, safety, and the
environment; nor will it represent substantial costs to licensees, the
NRC, or other Federal agencies. This constitutes the regulatory
analysis for this final rule.
VIII. Regulatory Flexibility Certification
In accordance with the Regulatory Flexibility Act (5 U.S.C.
605(b)), the Commission certifies that this rule does not have a
significant economic impact on a substantial number of small entities.
As a result, a regulatory flexibility analysis has not been prepared.
Interest and late payment
[[Page 30318]]
charges imposed on a small entity will ordinarily not exceed $100 per
year. This rule affects small entities billed for byproduct materials
licensing fees, and materials annual fees established under 10 CFR
170.31, Category 3, and 10 CFR 171.16, Category 3 (physicians in
private practice, small hospitals, other entities involved with
radiography and research), and for Freedom of Information Act
processing costs (small universities, small consulting firms, and
public interest groups). The NRC issues approximately 1,100 billings
annually to small entities. For example, the maximum annual billing
under 10 CFR 171.16, Category 3, to any one small entity is $2,300 per
fee category. Past experience shows that 97-98 percent of billings are
paid within 90 days after the billing date. The late payment charges
imposed for a small entity that pays the debt of $2,300, 90 days after
the billing date, will be $84.12 assuming a Treasury annual interest
rate of 6 percent, penalty at 6 percent, and administrative charges at
$5 per month.
The rule allows a small entity to pay a debt on an installment
basis if it is unable to pay a debt in full prior to the due date
(ordinarily 30 days after the billing date). This arrangement requires
the payment of interest on the unpaid debt and the administrative
charge for each month the installment is in effect. The annual interest
charges imposed on a small entity will be less than $140 assuming a
maximum billing of $2,300 paid in 12 monthly installments at an annual
interest rate of 6 percent and $60 in administrative charges.
IX. Backfit Analysis
The NRC has determined that the backfit rule does not apply to this
final rule; therefore, a backfit analysis is not required for this
final rule because these amendments are mandated by the DCIA of 1996
(Pub. L. 104-134, 110 Stat. 1321-358 (April 26, 1996)).
List of Subjects in 10 CFR Part 15
Administrative practice and procedures, Debt collection.
Small Business Regulatory Enforcement Fairness Act
In accordance with the Small Business Regulatory Enforcement Act of
1996, the NRC has determined that this action is not a major rule and
has verified this determination with the Office of Information and
Regulatory Affairs of OMB.
For the reasons set out in the preamble and under the authority of
the Atomic Energy Act of 1954, as amended; the Energy Reorganization
Act of 1974, as amended; and 5 U.S.C. 552 and 553, the NRC is adopting
the following amendments to 10 CFR part 15.
PART 15--DEBT COLLECTION PROCEDURES
1. The authority citation for Part 15 is revised to read as
follows:
Authority: Secs. 161, 186, 68 Stat. 948, 955, as amended (42
U.S.C. 2201, 2236); sec. 201, 88 Stat. 1242, as amended (42 U.S.C.
5841); sec. 1, Pub. L. 97-258, 96 Stat. 972 (31 U.S.C. 3713); sec.
5, Pub. L. 89-508, 80 Stat. 308, as amended (31 U.S.C. 3716); Pub.
L. 97-365, 96 Stat. 1749 (31 U.S.C. 3719); Federal Claims Collection
Standards, 31 CFR Chapter IX, parts 900-904; 31 U.S.C. Secs. 3701,
3716; 31 CFR Sec. 285; 26 U.S.C. Sec. 6402(d); 31 U.S.C. Sec. 3720A;
26 U.S.C. Sec. 6402(c); 42 U.S.C. Sec. 664; Pub. L. 104-134, as
amended (31 U.S.C. 3713); 5 U.S.C. 5514; Executive Order 12146 (3
CFR, 1980 Comp. pp. 409-412); Executive Order 12988 (3 CFR, 1996
Comp., pp. 157-163).
2. In Sec. 15.1 paragraphs (a)(1) and (a)(3) are revised and
paragraph (c) is added to read as follows:
Sec. 15.1 Application.
(a) * * *
(1) Collects, compromises, suspends, offsets, and terminates
collection action for claims;
* * * * *
(3) Refers unpaid claims over 180 days delinquent to Treasury for
offset and collection and to the DOJ for litigation.
* * * * *
(c) The NRC is not limited to collection remedies contained in the
revised Federal Claims Collection Standards (FCCS). The FCCS is not
intended to impair common law remedies.
3. In Sec. 15.2, the definition of Claim and debt is revised, and
the definitions of Administrative wage garnishment, Cross-servicing,
Federal agencies, Recoupment, Tax refund offset, Treasury, and
Withholding order, are added in alphabetical order to read as follows:
Sec. 15.2 Definitions.
* * * * *
Administrative wage garnishment is the process of withholding
amounts from an employee's disposable pay and the paying of those
amounts to a creditor in satisfaction of a withholding order.
Claim and debt are used synonymously to refer to an amount of
money, funds, or property that has been determined by an agency
official to be owed to the United States from any 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 Treasury or another debt collection
center is taking appropriate debt collection action on behalf of one or
more Federal agencies or a unit or subagency thereof.
* * * * *
Federal agencies include agencies of the executive, legislative,
and judicial branches of the Government, including Government
corporations.
* * * * *
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.
* * * * *
Tax refund offset means withholding or reducing a tax refund
payment by an amount necessary to satisfy a debt owed by the payee(s)
of a tax refund payment.
Treasury as used in 10 CFR part 15 means the Department of the
Treasury.
Withholding order means any order for withholding or garnishment of
pay issued by an agency, or judicial or administrative body.
4. In Sec. 15.5, paragraphs (b)(4) and (b)(5) are revised and
(b)(7) is added to read as follows:
Sec. 15.5 Claims that are covered.
* * * * *
(b) * * *
(4) A claim under the Internal Revenue Code of 1986.
(5) A claim between Federal agencies. Federal agencies should
attempt to resolve interagency claims as referenced in Executive Order
12146 (3 CFR, 1980 Comp., pp. 409-412).
* * * * *
(7) A claim involving bankruptcy is covered by Title 11 of the
United States Code.
5. In Sec. 15.7, paragraphs (a) and (b) are revised to read as
follows:
Sec. 15.7 Monetary limitation on NRC's authority.
* * * * *
(a) Have not been referred to another Federal Agency for further
collection actions; and
(b) Do not exceed $100,000 (exclusive of interest, penalties, and
administrative
[[Page 30319]]
charges) 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.
6. Section 15.8 is added to read as follows:
Sec. 15.8 Information Collection Requirements: OMB approval.
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.).
7. Section 15.9 is amended by revising the section heading and
paragraph (a) to read as follows:
Sec. 15.9 No private rights created.
(a) The failure of NRC to include in this part any provision of the
FCCS, 31 CFR Chapter IX, parts 900-904, does not prevent the NRC from
applying these provisions.
* * * * *
8. Section 15.11 is amended by revising the section heading and
paragraphs (a) and (b) to read as follows:
Sec. 15.11 Form of payment.
* * * * *
(a) The return of specific property; or
(b) The performance of specific services.
9. Section 15.20 is added under subpart B to read as follows:
Sec. 15.20 Aggressive agency collection activity.
(a) The NRC shall take aggressive action to collect all debts.
These collection activities will be undertaken promptly and follow-up
action will be taken as appropriate. These regulations do not require
the Department of Justice, Department of the Treasury (Treasury), or
any other Treasury-designated collection center to duplicate collection
activities previously undertaken by NRC.
(b) Debt referred or transferred to Treasury or to a Treasury-
designated debt collection center under the authority of 31 U.S.C.
3711(g) must be serviced, collected, or compromised, or the collection
action will be suspended or terminated, in accordance with the
statutory requirements and authorities applicable to the collection of
the debts.
(c) The NRC shall cooperate with other agencies in their debt
collection activities.
(d) The NRC will consider referring debts that are less than 180
days delinquent to Treasury or to a Treasury-designated debt collection
center to accomplish efficient, cost-effective debt collection.
Referrals to debt collection centers are at the discretion of, and for
a time period acceptable to, Treasury.
(e) The NRC shall transfer any debt that has been delinquent for
180 days or more to Treasury so that it may take appropriate action to
collect the debt or terminate collection actions. This requirement does
not apply to any debt that--
(1) Is in litigation or foreclosure;
(2) Will be disposed of under an approved asset sale program;
(3) Has been referred to a private collection contractor for a
period of time acceptable to Treasury;
(4) Is at a debt collection center for a period of time acceptable
to Treasury;
(5) Will be collected under internal offset procedures within 3
years after the date the debt first became delinquent; or
(6) Is exempt from this requirement based on a determination by
Treasury that exemption for a certain class of debt is in the best
interest of the United States.
(f) Agencies operating Treasury-designated debt collection centers
are authorized to charge a fee for services rendered regarding referred
or transferred debts. The fee may be paid out of amounts collected and
may be added to the debt as an administrative cost.
10. In Sec. 15.21, paragraphs (a)(5), (a)(6), the introductory text
of paragraph (b), paragraphs (b)(3)(ii), (b)(3)(iii), and (b)(3)(vi)
are revised and paragraphs (a)(7) and (e) are added to read as follows:
Sec. 15.21 Written demands for payment.
(a) * * *
(5) The applicable standards for assessing interest, penalties, and
administrative costs under 31 CFR 901.9;
(6) The applicable policy for reporting the delinquent debt to
consumer reporting agencies; and
(7) The name, address, and phone number of a contact person or
office within the NRC will be included with each demand letter.
(b) The NRC shall normally send two demand letters to debtors. The
initial demand letter will be followed approximately 30 days later with
a second demand letter, unless circumstances indicate that alternative
remedies better protect the Government's interest, that the debtor has
explicitly refused to pay, or that sending a further demand letter is
futile. Depending upon the circumstances, the first and second demand
letters may--
* * * * *
(3) * * *
(ii) The NRC may report debts to credit bureaus, refer debts to
debt collection centers and collection agencies for cross-servicing
(including wage garnishment), tax refund offset, administrative offset,
and litigation. Any eligible debt that is delinquent for 180 days or
more will be transferred to the Treasury for collection. Credit bureau
reporting for transferred debts will be handled by Treasury or a
Treasury-designated center.
(iii) Possible reporting of the delinquent debt to consumer
reporting agencies in accordance with the guidance and standards
contained in 31 CFR 901.4.
* * * * *
(vi) The right to refer the claim to DOJ for litigation.
* * * * *
(e) When the NRC learns that a bankruptcy petition has been filed
with respect to a debtor, the NRC will cease collection action
immediately unless it has been determined that under 11 U.S.C. 362, the
automatic stay has been lifted or is no longer in effect.
11. In Sec. 15.23, the section heading and paragraph (a) are
revised to read as follows:
Sec. 15.23 Telephone or internet inquiries and investigations.
(a) If a debtor has not responded to one or more demands, the NRC
shall make reasonable efforts by telephone or internet to determine the
debtor's intentions.
* * * * *
12. Section 15.26 is amended by revising the section heading and
paragraph (a)(2), removing paragraph (a)(3), and redesignating
paragraphs (a)(4) and (a)(5) as (a)(3) and (a)(4) and revising these
paragraphs to read as follows:.
Sec. 15.26 Reporting claims.
(a) * * *
(2) The NRC has included a notification in the second written
demand (see Sec. 15.21(b)) to the individual debtor stating--
(i) That the payment of the debt is delinquent;
(ii) That within not less than 60 days after the date of the
notification, the NRC intends to disclose to a consumer reporting
agency that the individual debtor is responsible for the debt;
(iii) The specific information to be disclosed to the consumer
reporting agency; and
(iv) That the debtor has a right to a complete explanation of the
debt (if that has not already been given), to dispute information in
NRC records about the
[[Page 30320]]
debt, and to request reconsideration of the debt by administrative
appeal or review of the debt.
(3) The NRC has reconsidered its initial decision on the debt when
the debtor has requested a review under paragraph (a)(2)(iv) of this
section.
(4) The NRC has taken reasonable action to locate a debtor for whom
the NRC does not have a current address to send the notification
provided for in paragraph (a)(2) of this section.
* * * * *
13. Section 15.29 is revised to read as follows:
Sec. 15.29 Suspension or revocation of license.
In non-bankruptcy cases, the NRC may suspend or revoke any license,
permit, or approval which the NRC has granted to the debtor for any
inexcusable, prolonged, or repeated failure of the debtor to pay a
delinquent debt. Before suspending or revoking any license, permit, or
approval for failure to pay a debt, the NRC shall issue to the debtor
(by certified mail) an order or a demand for information as to why the
license, permit, or approval should not be suspended or revoked. The
NRC shall allow the debtor no more than 30 days to pay the debt in
full, including applicable interest, penalties, and administrative
costs of collection of the delinquent debt. The NRC may revoke the
license, permit, or approval at the end of this period. If a license is
revoked under authority of this part, a new application, with
appropriate fees, must be made to the NRC. The NRC may not consider an
application unless all previous delinquent debts of the debtor to the
NRC have been paid in full. The suspension or revocation of a license,
permit, or approval is also applicable to Federal programs or
activities that are administered by the states on behalf of the Federal
Government to the extent that they affect the Federal Government's
ability to collect money or funds owed by debtors. In bankruptcy cases,
before advising the debtor of NRC's intention to suspend or revoke
licenses, permits, or approvals, the NRC will seek legal advice from
its Office of the General Counsel concerning the impact of the
Bankruptcy Code which may restrict such action.
14. Section 15.32 is revised to read as follows:
Sec. 15.32 Contracting for collection services.
The NRC may contract for collection services in order to recover
delinquent debts only if the debts are not subject to the DCIA
requirement to transfer debts to Treasury for debt collection services,
e.g. debts that are less than 180 days delinquent. However, the NRC
retains the authority to resolve disputes, compromise claims, suspend
or terminate collection action, and initiate enforced collection
through litigation. When appropriate, the NRC shall contract for
collection services in accordance with the guidance and standards
contained in 31 CFR chapter IX, parts 900-904.
15. Section 15.33 is revised to read as follows:
Sec. 15.33 Collection by administrative offset.
(a) Application. (1) The NRC 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:
(i) Debts arising under the Social Security Act, except as provided
in 42 U.S.C. 404;
(ii) Payments made under the Social Security Act, except as
provided for in 31 U.S.C. 3716(c) (see 31 CFR 285.4, Federal Benefit
Offset);
(iii) Debts arising under, or payments made under, the Internal
Revenue Code (see 31 CFR 285.2, Tax Refund Offset) or the tariff laws
of the United States;
(iv) Offsets against Federal salaries to the extent these standards
are inconsistent with regulations published to implement such offsets
under 5 U.S.C. 5514 and 31 U.S.C. 3716 (see 5 CFR part 550, subpart K,
and 31 CFR 285.7, Federal Salary Offset);
(v) Offsets under 31 U.S.C. 3728 against a judgment obtained by a
debtor against the United States;
(vi) Offsets or recoupments under common law, State law, or Federal
statutes specifically prohibiting offsets or recoupments of particular
types of debts; or
(vii) Offsets in the course of judicial proceedings, including
bankruptcy.
(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
their applicable statutory authority.
(4) Unless otherwise provided by law, the NRC may not initiate
administrative offset of payments under the authority of 31 U.S.C. 3716
to collect a debt more than 10 years after the Government's right to
collect the debt first accrued, unless facts material to the
Government's right to collect the debt were not known and could not
reasonably have been known to the NRC, or collection of ``approval''
fees has been deferred under 10 CFR part 170. If the collection of
``approval'' fees has been deferred, the ten-year period begins to run
at the end of the deferral period.
(5) In bankruptcy cases, the NRC will seek legal advice from its
Office of the General Counsel concerning the impact of the Bankruptcy
Code on pending or contemplated collections by offset.
(b) Mandatory centralized offset. (1) The NRC is required to refer
past due, legally enforceable, nontax debts that are over 180 days
delinquent to Treasury for collection by centralized administrative
offset. A debt is legally enforceable if there has been a final NRC
determination that the debt, in the amount stated, is due and there are
no legal bars to collection action. Debts that are less than 180 days
delinquent also may be referred to Treasury for this purpose.
(2) The names and taxpayer identifying numbers (TINs) of debtors
who owe debts referred to Treasury as described in paragraph (b)(1) of
this section must be compared to the names and TINs on payments to be
made by Federal disbursing officials. Federal disbursing officials
include disbursing officials of Treasury, the Department of Defense,
the United States Postal Service, other Government corporations, and
disbursing officials of the United States designated by Treasury. When
the name and TIN of a debtor match the name and TIN of a payee and all
other requirements for offset have been met, the payment will be offset
to satisfy the debt.
(3) Federal disbursing officials will notify the debtor/payee in
writing that an offset has occurred to satisfy, in part or in full, a
past due, legally enforceable delinquent debt. The notice must include
a description of the type and amount of the payment from which the
offset was taken, the amount of offset that was taken, the identity of
the creditor agency (NRC) requesting the offset, and a contact point
within NRC who will respond to questions regarding the offset
(c) NRC administrative offset. (1) Before referring a delinquent
debt to Treasury for administrative offset, the NRC adopts the
following administrative offset procedures:
(i) Offsets may be initiated only after the debtor has been sent
written notice of the type and amount of the debt, the intention of the
NRC to use administrative offset to collect the debt, and an
explanation of the debtor's rights under 31 U.S.C. 3716; and
(ii) The debtor has been given--
(A) The opportunity to inspect and copy NRC records related to the
debt;
[[Page 30321]]
(B) The opportunity for a review within the NRC of the
determination of indebtedness; and
(C) The opportunity to make a written agreement to repay the debt.
(iii) The procedures set forth in paragraph (c)(1)(i) of this
section may be omitted when--
(A) The offset is in the nature of a recoupment;
(B) The debt arises under a contract as set forth in Cecile
Industries, Inc. v. Cheney, 995 F.2d 1052 (Fed. Cir. 1993) (notice and
other procedural protections set forth in 31 U.S.C. 3716(a) do not
supplant or restrict established procedures for contractual offsets
accommodated by the Contracts Disputes Act); or
(C) The NRC first learns of the existence of the amount owed by the
debtor when there is insufficient time before payment would be made to
the debtor/payee to allow for prior notice and an opportunity for
review. This applies to non-centralized offsets conducted under
paragraph (d) of this section. When prior notice and an opportunity for
review are omitted, the NRC shall give the debtor notice and an
opportunity for review as soon as practicable and shall refund any
money ultimately found not to have been owed to the NRC.
(iv) When an agency previously has given a debtor any of the
required notice and review opportunities with respect to a particular
debt (31 CFR 901.2), the NRC need not duplicate the notice and review
opportunities before administrative offset may be initiated.
(2) When referring delinquent debts to Treasury, the NRC shall
certify, in a form acceptable to Treasury, that:
(i) The debt is past due and legally enforceable; and
(ii) The NRC has complied with all due process requirements under
31 U.S.C. 3716(a) and the NRC's regulations.
(3) Payments that are prohibited by law from being offset are
exempt from centralized administrative offset. The Treasury shall
exempt payments under means-tested programs from centralized
administrative offset when requested in writing by the head of the
payment-certifying or authorizing agency. Also, the Treasury may exempt
other classes of payments from centralized offset upon the written
request of the head of the payment-certifying or authorizing agency.
(4) Benefit payments made under the Social Security Act (42 U.S.C.
301 et seq.), part B of the Black Lung Benefits Act (30 U.S.C. 921 et
seq.), and any law administered by the Railroad Retirement Board (other
than tier 2 benefits), may be offset only in accordance with Treasury
regulations, issued in consultation with the Social Security
Administration, the Railroad Retirement Board, and the Office of
Management and Budget (31 CFR 285.4).
(5) In accordance with 31 U.S.C. 3716(f), the Treasury may waive
the provisions of the Computer Matching and Privacy Protection Act of
1988 concerning matching agreements and post-match notification and
verification (5 U.S.C. 552a(o) and (p)) for centralized administrative
offset upon receipt of a certification from the NRC that the due
process requirements enumerated in 31 U.S.C. 3716(a) have been met. The
certification of a debt in accordance with paragraph (c)(2) of this
section will satisfy this requirement. If a waiver is granted, only the
Data Integrity Board of the Department of the Treasury is required to
oversee any matching activities, in accordance with 31 U.S.C. 3716(g).
This waiver authority does not apply to offsets conducted under
paragraphs (c) and (d) of this section.
(d) Non-centralized administrative offset. (1) Generally, non-
centralized administrative offsets are ad hoc case-by-case offsets that
NRC would conduct, at its discretion, internally or in cooperation with
the agency certifying or authorizing payments to the debtor. Unless
otherwise prohibited by law, when centralized administrative offset is
not available or appropriate, past due, legally enforceable, nontax
delinquent debts may be collected through non-centralized
administrative offset. In these cases, the NRC may make a request
directly to a payment-authorizing agency to offset a payment due a
debtor to collect a delinquent debt. For example, the NRC will request
the Office of Personnel Management (OPM) to offset a Federal employee's
lump sum payment upon leaving Government service to satisfy an unpaid
advance.
(2) Before requesting Treasury to conduct a non-centralized
administrative offset, the NRC adopts the following procedures, which
provide that such offsets may occur only after:
(i) The debtor has been provided due process as set forth in
paragraph (c)(1) of this section; and
(ii) The Treasury has received written certification from NRC that
the debtor owes the past due, legally enforceable delinquent debt in
the amount stated, and that the NRC has fully complied with its
regulations concerning administrative offset.
(3) Treasury shall comply with offset requests by NRC to collect
debts owed to the United States, unless the offset would not be in the
best interests of the United States with respect to the Treasury's
program, or would otherwise be contrary to law. Appropriate use should
be made of the cooperative efforts of other agencies in effecting
collection by administrative offset.
(4) When collecting multiple debts by non-centralized
administrative offset, the NRC will apply the recovered amounts to
those debts in accordance with the best interests of the United States,
as determined by the facts and circumstances of the particular case,
particularly the applicable statute of limitations.
(e) Requests to OPM to offset a debtor's anticipated or future
benefit payment under the Civil Service Retirement and Disability Fund.
Upon providing OPM written certification that a debtor has been
afforded the procedures provided in paragraph (c)(1) of this section,
the NRC will request OPM to 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. Upon receipt of such a request, OPM will identify and
``flag'' a debtor's account in anticipation of the time when the debtor
requests, or becomes eligible to receive, payments from the Fund. This
will satisfy any requirement that offset be initiated prior to the
expiration of the time limitations referenced in paragraph (a)(4) of
this section.
(f) Review requirements. (1) For purposes of this section, whenever
the NRC is required to afford a debtor a review within the agency, the
NRC shall provide the debtor with a reasonable opportunity for an oral
hearing in accordance with 10 CFR 16.9, when the debtor requests
reconsideration of the debt, and the NRC determines that the question
of the indebtedness cannot be resolved by review of the documentary
evidence, for example, when the validity of the debt turns on an issue
of credibility or veracity.
(2) Unless otherwise required by law, an oral hearing under this
section is not required to be a formal evidentiary hearing, although
the NRC should carefully document all significant matters discussed at
the hearing.
(3) This section does not require an oral hearing with respect to
debt collection systems in which a determination of indebtedness rarely
involves issues of credibility or veracity, and the NRC has determined
that review of the written record is ordinarily an adequate means to
correct prior mistakes.
[[Page 30322]]
(4) In those cases in which an oral hearing is not required by this
section, the NRC shall accord the debtor a ``paper hearing,'' that is,
a determination of the request for reconsideration based upon a review
of the written record.
16. In Sec. 15.35, paragraph (b), the introductory text of
paragraph (c), and paragraph (c)(1) are revised to read as follows:
Sec. 15.35 Payments.
* * * * *
(b) Payment by installment. If a debtor furnishes satisfactory
evidence of inability to pay a claim in one lump sum, payment in
regular installments may be arranged. Evidence may consist of a
financial statement or a signed statement that the debtor's application
for a loan to enable the debtor to pay the claim in full was rejected.
Except for a claim described in 5 U.S.C. 5514 and codified in 10 CFR
part 16, all installment payment arrangements must be in writing and
require the payment of interest and administrative charges.
(1) Installment note forms may be used. The written installment
agreement must contain a provision accelerating the debt payment in the
event the debtor defaults. If the debtor's financial statement
discloses the ownership of assets which are free and clear of liens or
security interests, or assets in which the debtor owns an equity, the
debtor may be asked to secure the payment of an installment note by
executing a Security Agreement and Financing Statement transferring to
the United States a security interest in the asset until the debt is
discharged.
(2) If the debtor owes more than one debt, the NRC will apply the
payment to the various debts in accordance with the best interests of
the United States, as determined by the facts and circumstances of the
particular case.
(c) To whom payment is made. Payment of a debt is made by check,
electronic transfer, draft, credit card, or money order and should be
payable to the United States Nuclear Regulatory Commission, License Fee
and Accounts Receivable Branch, P.O. Box 954514, St. Louis, MO. 63195-
4514, unless payment is--
(1) Made pursuant to arrangements with DOJ;
* * * * *
17. In Sec. 15.37, paragraphs (a) and (b) are revised and paragraph
(l) is added to read as follows:
Sec. 15.37 Interest, penalties, and administrative costs.
(a) The NRC shall assess interest, penalties, and administrative
costs on debts owed to the United States Government in accordance with
the guidance provided under the FCCS, 31 CFR 901.9.
(b) Before assessing any charges on delinquent debt, the NRC shall
mail or hand-deliver a written notice to the debtor explaining its
requirements concerning these charges under 31 CFR 901.2 and 901.9,
except where these charges are included in a contractual or repayment
agreement.
* * * * *
(l) The NRC is authorized to impose interest and related charges on
debts not subject to 31 U.S.C. 3717, in accordance with common law.
18. Section 15.39 is revised to read as follows:
Sec. 15.39 Bankruptcy claims.
When the NRC learns that a bankruptcy petition has been filed with
respect to a debtor, before proceeding with further collection action,
the NRC will immediately seek legal advice from its Office of the
General Counsel concerning the impact of the Bankruptcy Code on any
pending or contemplated collection activities. Unless the NRC
determines 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,
collection activity against the debtor will in most cases stop
immediately.
(a) After seeking legal advice from its Office of the General
Counsel, a proof of claim usually will be filed with the bankruptcy
court or the Trustee.
(b) If the NRC is a secured creditor, it may seek relief from the
automatic stay regarding its security, subject to the provisions and
requirements of 11 U.S.C. 362.
(c) Offset is stayed in most cases by the automatic stay. However,
the NRC will seek legal advice from its Office of the General Counsel
to determine whether its payments to the debtor and payments of other
agencies available for offset may be frozen by the agency until relief
from the automatic stay can be obtained from the bankruptcy court. The
NRC will seek legal advice from its Office of the General Counsel to
determine if recoupment is available.
19. Section 15.41 is revised to read as follows:
Sec. 15.41 When a claim may be compromised.
(a) The NRC may compromise a claim not in excess of the monetary
limitation if it has not been referred to DOJ for litigation.
(b) Unless otherwise provided by law, when the principal balance of
a debt, exclusive of interest, penalties, and administrative costs,
exceeds $100,000 or any higher amount authorized by the Attorney
General, the authority to accept the compromise rests with the DOJ. The
NRC will evaluate the compromise offer, using the factors set forth in
this part. If an offer to compromise any debt in excess of $100,000 is
acceptable to the NRC, the NRC shall refer the debt to the Civil
Division or other appropriate litigating division in the DOJ using a
CCLR. The referral must include appropriate financial information and a
recommendation for the acceptance of the compromise offer. DOJ approval
is not required if the compromise offer is rejected by NRC.
20. In Sec. 15.43, paragraphs (c) and (d) are revised to read as
follows:
Sec. 15.43 Reasons for compromising a claim.
* * * * *
(c) The cost of collecting the claim does not justify the enforced
collection of the full amount. The NRC shall apply this reason for
compromise in accordance with the guidance in 31 CFR 902.2.
(d) The NRC shall determine the debtor's inability to pay, the
Government's ability to enforce collection, and the amounts that are
acceptable in compromise in accordance with the FCCS, 31 CFR part 902.
* * * * *
21. Section 15.45 is revised to read as follows:
Sec. 15.45 Consideration of tax consequences to the Government.
(a) The NRC may accept a percentage of a debtor's profits or stock
in a debtor corporation in compromise of a claim. In negotiating a
compromise with a business concern, the NRC should consider requiring a
waiver of tax-loss-carry-forward and tax-loss-carry-back rights of the
debtor. For information on reporting requirements, see Sec. 15.60.
(b) When two or more debtors are jointly and severally liable, the
NRC will pursue collection activity against all debtors, as
appropriate. The NRC will not attempt to allocate the burden of payment
between the debtors but will proceed to liquidate the indebtedness as
quickly as possible. The NRC will ensure that a compromise agreement
with one debtor does not release the NRC's claim against the remaining
debtors. The amount of a compromise with one debtor shall not be
considered a precedent or binding in determining the amount that will
be required from other debtors jointly and severally liable on the
claim.
22. Section 15.49 is added to subpart C to read as follows:
[[Page 30323]]
Sec. 15.49 Mutual releases of the debtor and the Government.
(a) In all appropriate instances, a compromise that is accepted by
NRC should be implemented by means of a mutual release.
(1) The debtor is released from further non-tax liability on the
compromised debt in consideration of payment in full of the compromised
amount.
(2) The Government and its officials, past and present, are
released and discharged from any and all claims and causes of action
arising from the same transaction held by the debtor.
(b) If a mutual release is not executed when a debt is compromised,
unless prohibited by law, the debtor is still deemed to have waived any
and all claims and causes of action against the Government and its
officials related to the transaction giving rise to the compromised
debt.
23. Section 15.51 is revised to read as follows:
Sec. 15.51 When collection action may be suspended or terminated.
The NRC 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 of the debt has not been referred to
the DOJ for litigation. If, after deducting the amount of any partial
payments or collections, the principal amount of a debt exceeds
$100,000, or such other amount as the Attorney General may direct,
exclusive of interest, penalties, and administrative costs, the
authority to suspend or terminate rests solely with the DOJ. If the NRC
believes that suspension or termination of any debt in excess of
$100,000 may be appropriate, the NRC shall refer the debt to the Civil
Division or other appropriate litigating division in the DOJ, using the
CCLR. The referral should specify the reasons for the NRC's
recommendation. If, prior to referral to the DOJ, the NRC determines
that a debt is plainly erroneous or clearly without legal merit, the
NRC may terminate collection activity, regardless of the amount
involved, without obtaining DOJ concurrence.
24. Section 15.53 is revised to read as follows:
Sec. 15.53 Reasons for suspending collection action.
The NRC may suspend collection activity when:
(a) The NRC cannot locate the debtor;
(b) The debtor's financial condition is not expected to improve; or
(c) The debtor has requested a waiver or review of the debt.
(d) Based on the current financial condition of the debtor, the NRC
may suspend collection activity on a debt when the debtor's future
prospects justify retention of the debt for periodic review and
collection activity and:
(1) The applicable statute of limitations has not expired; or
(2) Future collection can be effected by administrative offset,
notwithstanding the expiration of the applicable statute of limitations
for litigation of claims, with due regard to the 10-year limitation for
administrative offset prescribed by 31 U.S.C. 3716(e)(1); or
(3) The debtor agrees to pay interest on the amount of the debt on
which collection will be suspended, and such suspension is likely to
enhance the debtor's ability to pay the full amount of the principal of
the debt with interest at a later date.
(e)(1) The NRC shall suspend collection activity during the time
required for consideration of the debtor's request for waiver or
administrative review of the debt, if the statute under which the
request is sought prohibits the NRC from collecting the debt during
that time.
(2) If the statute under which the request is sought does not
prohibit collection activity pending consideration of the request, the
NRC may use discretion, on a case-by-case basis, to suspend collection.
Further, the NRC ordinarily should suspend collection action upon a
request for waiver or review, if the NRC is prohibited by statute or
regulation from issuing a refund of amounts collected prior to NRC
consideration of the debtor's request. However, the NRC should not
suspend collection when the NRC determines that the request for waiver
or review is frivolous or was made primarily to delay collection.
(f) When the NRC learns that a bankruptcy petition has been filed
with respect to a debtor, in most cases, the collection activity on a
debt must be suspended, pursuant to the provisions of 11 U.S.C. 362,
1201, and 1301, unless the NRC can clearly establish that the automatic
stay has been lifted or is no longer in effect. The NRC should seek
legal advice immediately from its Office of the General Counsel and, if
legally permitted, take the necessary steps to ensure that no funds or
money are paid by the NRC to the debtor until relief from the automatic
stay is obtained.
25. Section 15.55 is revised to read as follows:
Sec. 15.55 Reasons for terminating collection action.
The NRC may terminate collection activity when:
(a) The NRC is unable to collect any substantial amount through its
own efforts or through the efforts of others;
(b) The NRC is unable to locate the debtor;
(c) Costs of collection are anticipated to exceed the amount
recoverable,
(d) The debt is legally without merit or enforcement of the debt is
barred by any applicable statute of limitations;
(e) The debt cannot be substantiated; or
(f) The debt against the debtor has been discharged in bankruptcy.
26. Section 15.57 is revised to read as follows:
Sec. 15.57 Termination of collection action.
(a) Before terminating collection activity, the NRC should have
pursued all appropriate means of collection and determined, based upon
the 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 NRC
from retaining a record of the account for purposes of:
(1) Selling the debt, if the Treasury determines that such sale is
in the best interests of the United States;
(2) Pursuing collection at a subsequent date in the event there is
a change in the debtor's status or a new collection tool becomes
available;
(3) Offsetting against future income or assets not available at the
time of termination of collection activity; or
(4) Screening future applicants for prior indebtedness.
(b) Generally, the NRC will terminate collection activity on a debt
that has been discharged in bankruptcy, regardless of the amount.
However, the NRC may continue collection activity, subject to the
provisions of the Bankruptcy Code, for any payments provided under a
plan of reorganization.
27. Section 15.59 is revised to read as follows:
Sec. 15.59 Exception to termination.
When a significant enforcement policy is involved, or recovery of a
judgment is a prerequisite to the imposition of administrative
sanctions, the NRC may refer debts for litigation, although termination
of collection activity may be appropriate.
28. Section 15.60 is added to subpart D to read as follows:
[[Page 30324]]
Sec. 15.60 Discharge of indebtedness; reporting requirements.
(a) Before discharging a delinquent debt (also referred to as a
close out of the debt), the NRC 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, Treasury-designated debt 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 under 10 CFR 15.55 and 15.57 and is governed by the Internal
Revenue Code. When collection action on a debt is suspended or
terminated, the debt remains delinquent, and further collection action
may be pursued at a later date. When the NRC discharges a debt in full
or in part, further collection action is prohibited. Therefore, the NRC
will make the determination that collection action is no longer
warranted before discharging a debt. Before discharging a debt, the NRC
must terminate debt collection action.
(b) Section 3711(i), title 31, United States Code, requires
agencies to sell a delinquent nontax debt upon termination of
collection action if Treasury determines such a sale is in the best
interests of the United States. Since the discharge of a debt precludes
any further collection action (including the sale of a delinquent
debt), the NRC may not discharge a debt until the requirements of 31
U.S.C. 3711(i) have been met.
(c) Upon discharge of an indebtedness, the NRC shall report the
discharge to the IRS in accordance with the requirements of 26 U.S.C.
6050P and 26 CFR 1.6050P-1. The NRC may request Treasury or a Treasury-
designated debt collection center to file a discharge report to the IRS
on the NRC's behalf.
(d) When discharging a debt, the NRC shall request that litigation
counsel release any liens of record securing the debt.
29. Section 15.61 is revised to read as follows:
Sec. 15.61 Prompt referral.
(a) The NRC shall promptly refer debts that are subject to
aggressive collection activity (as described in subpart B of this part)
and that cannot be compromised, or debts on which collection activity
cannot be suspended or terminated, to DOJ for litigation. Debts for
which the principal amount exceeds $1,000,000, or such other amount as
the Attorney General may direct, exclusive of interest and penalties,
must be referred to the Civil Division or other division responsible
for litigating such debts at DOJ, Washington, DC. Debts for which the
principal amount is $1,000,000 or less, or such other amount as the
Attorney General may direct, exclusive of interest or penalties, must
be referred to the DOJ's Nationwide Central Intake Facility, as
required by the CCLR instructions. Debts will be referred as early as
possible, consistent with the NRC's aggressive collection activity and
well within the one year of the NRC's final determination of the fact
and the amount of the debt.
(b) DOJ has exclusive jurisdiction over the debts referred to in
paragraph (a) of this section. The NRC shall terminate the use of any
administrative collection activities to collect a debt when the debt is
referred to DOJ. The NRC shall advise the DOJ of the collection
activities it used and the results. The NRC shall refrain from having
any contact with the debtor and shall direct all inquiries to DOJ. The
NRC shall immediately notify DOJ of any payments credited to the
debtor's account after the account has been referred to DOJ. DOJ shall
notify NRC in a timely manner of any payments it receives from the
debtor.
30. Section 15.65 is revised to read as follows:
Sec. 15.65 Referral of a compromise offer.
The NRC may refer a debtor's firm written offer of compromise,
which is substantial in amount, to the Civil Division or other
appropriate litigating division in DOJ using a CCLR accompanied by
supporting data and particulars concerning the debt.
31. Section 15.67 is revised to read as follows:
Sec. 15.67 Referral to the Department of Justice.
(a) Unless excepted by DOJ, the NRC shall complete the CCLR
accompanied by a Certificate of Indebtedness, to refer all
administratively uncollectible claims to the DOJ for litigation.
(b) The NRC shall indicate the actions it wishes DOJ to take
regarding the referred claim on the CCLR.
(c) Before referring a debt to DOJ for litigation, the NRC shall
notify each person determined to be liable for the debt that, unless
the debt can be collected administratively, litigation may be
initiated. This notification must comply with Executive Order 12988 (3
CFR, 1996 Comp., pp 157-163) and may be given as part of a demand
letter or as a separate document.
(d) The NRC shall preserve all files and records that DOJ may need
to prove the claim in court.
(e) The NRC may ordinarily not refer for litigation claims of less
than $2,500, exclusive of interest, penalties, and administrative
charges, or such other amount as the Attorney General shall from time
to time prescribe.
(f) The NRC may not refer claims of less than the minimum amount
unless:
(1) Litigation to collect a smaller claim is important to ensure
compliance with NRC's policies and programs;
(2) The claim is being referred solely to secure a judgment against
the debtor, which will be filed as a lien against the debtor's property
under 28 U.S.C. 3201 and returned to the NRC for enforcement, or
(3) The debtor has the clear ability to pay the claim, and the
Government effectively can enforce payment, with due regard for the
exemptions available to the debtor under state and Federal law and the
judicial remedies available to the Government.
Dated at Rockville, Maryland, this 24th day of April 2002.
For the Nuclear Regulatory Commission.
Jesse L. Funches,
Chief Financial Officer.
[FR Doc. 02-11022 Filed 5-3-02; 8:45 am]
BILLING CODE 7590-01-P
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