[Code of Federal Regulations]
[Title 7 Volume 4]
[Revised as of January 1, 2001]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR272.12]

[Page 586-587]
 
                          TITLE 7--AGRICULTURE
 
    CHAPTER II--FOOD AND NUTRITION SERVICE, DEPARTMENT OF AGRICULTURE
 
PART 272--REQUIREMENTS FOR PARTICIPATING STATE AGENCIES--Table of Contents
 
Sec. 272.12  Intercept of unemployment compensation benefits.

    (a) General. State agencies may, at their option, arrange for the 
intercept of unemployment compensation (UC) benefits to collect claims 
for intentional Program violations as defined in Sec. 273.16(c). State 
agencies may not conduct such intercepts unless they have an FNS-
approved attachment to their Plan of Operation as required by 
Sec. 272.2(d)(l)(x). Acceptance of the intercept of UC method of 
collection is voluntary with each affected household.
    (b) Identification of households subject to the intercept. (1) State 
agencies which decide to use the intercept procedure shall, in the 
attachments to the Plan of Operations required by Sec. 272.2(d)(1)(x), 
specify if they will use the intercept for nonparticipating households 
only or for both nonparticipating and participating households. They 
shall also specify the type of case subject to UC intercept or the 
selection criteria for referral of households for intercept.
    (2) Upon request of the UC agency, State agencies may provide such 
agencies identifying casefile information about individuals subject to 
the intercept.
    (3) State agencies shall request that the UC agency provide the 
State agency the following information from UC files about any such 
individuals:
    (i) Whether the individual is receiving UC benefits;
    (ii) The amount of any such benefits; and
    (iii) The current (or most recent) home address of the individual.
    (c) Notice of intercept procedures. (1) State agencies shall notify 
households subject to the intercept pursuant to paragraph (b) of this 
section as follows:
    (i) State agencies shall notify participating households of the UC 
intercept procedures with the initial demand letter sent in accordance 
with Sec. 273.18(d)(3). This letter shall explain to the households that 
it may use the intercept alone or in combination with other repayment 
methods, that use of the intercept is voluntary, and that the intercept 
is one of several repayment methods available to them;
    (ii) State agencies shall notify nonparticipating households which 
have failed to repay claims for intentional program violation of the 
intercept method unless the judicial action specified in paragraph (f) 
of this section will be taken without attempting to reach a voluntary 
agreement. Notices to nonparticipating households shall include a copy 
of the agreement described in paragraph (d) of this section and 
directions for contacting the State agency. If the State agency plans to 
initiate judicial process as described in paragraph (f) of this section 
against a household which does not voluntarily agree to the intercept, 
the notice shall advise such households that judicial action shall be 
initiated unless the household contacts the State agency within 10 days 
of receipt of the notice.
    (2) As part of the agreement with UC agencies described in paragraph 
(g) of this section, State agencies may arrange for UC agencies to 
provide UC claimants a notice of the intercept option with directions 
about how to contact the State agency for further information to be 
included on or with the application for UC benefits.
    (d) Agreements with individuals. State agencies may arrange with 
households for deductions from UC benefits by executing agreements with 
individual household members who receive UC benefits. Copies of 
agreements with individuals shall be provided to UC agencies as provided 
in paragraph (g) of this section. The agreements shall include:
    (1) The total amount to be deducted from UC benefits otherwise due;
    (2) The amount of UC benefits to be deducted each week;
    (3) The number of weeks the deduction will be made;
    (4) A statement that:
    (i) It is the individual's responsibility to notify the State agency 
if a change in the amount of the deduction is necessary, for example, 
because of a

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change of earnings or in other circumstances affecting income;
    (ii) The amount of a weekly deduction is a maximum which may be 
decreased if there are insufficient UC benefits to allow the full 
deduction and the number of weeks for the deduction may be 
correspondingly increased to complete collection; and
    (iii) The State agency will provide the individual a receipt for the 
total amount of deductions actually made;
    (5) The signature of the individual agreeing to the deductions; and
    (6) Either on the agreement or on a transmittal to the UC agency, a 
signature of a State agency official indicating concurrence with the 
agreement.
    (e) Amounts of deduction. The amount of the weekly deduction shall 
be determined by agreement between the individual and State agency, 
provided that for participating households the amount, in combination 
with any other repayment methods, shall result in a scheduled repayment 
rate no less than that which would be repaid through the allotment 
reduction prescribed in Sec. 273.18(g)(3). The determination of the 
amount shall take into account such factors as the total amount of the 
claim, the amount of weekly UC benefits and the number of weeks they are 
expected to be paid, other income available to the individual, and any 
other deductions from the individual's UC benefits, allowing priority to 
such mandatory deductions as those for child support payments required 
by the Social Security Act and recoveries of prior excess UC benefits.
    (f) Court-ordered deductions. State agencies may attempt to recover 
claims for intentional program violations from nonparticipating 
households by obtaining a writ, order, summons, or other similar process 
in the nature of garnishment from a court of competent jurisdiction to 
require the withholding of amounts from unemployment compensation. 
Subject to State and local law, State agencies may seek such judicial 
action before or after attempting to reach a voluntary agreement as 
described in paragraph (d) of this section.
    (1) The State agency shall determine an amount to be withheld each 
week by considering as many of the factors listed in paragraph (e) of 
this section as it has knowledge of and shall recommend such amount to 
the court. The State agency shall notify the court of any mandatory 
deductions from an individual's UC benefits of which it has knowledge.
    (2) The State agency shall assure that any individual against whom a 
court-ordered deduction is sought is notified of:
    (i) The total amount to be deducted from UC benefits otherwise due;
    (ii) The amount of UC benefits to be deducted each week; and
    (iii) The number of weeks the deduction will be made.
    (3) The State agency shall provide the UC agency the information 
specified in paragraph (f)(1) of this section and a copy of the court 
order or a summary as the UC agency may request.
    (g) Agreement with UC agencies. State agencies using the procedures 
specified in this section shall execute written agreements with UC 
agencies, including UC agencies in other States when circumstances and 
experience indicate that would be useful. The agreements shall include:
    (1) The requirements specified in this section which affect both 
agencies, including the identifying information the State agency will 
provide, the frequency of and the procedures for exchanging information;
    (2) The particular costs, both initial and ongoing, which the State 
agency shall reimburse the UC agency. Such costs shall be limited to 
those attributable to the repayment of claims for intentional Program 
violations for which the State agency does not otherwise reimburse the 
UC agency; and
    (3) The frequency of transmittals of deductions from UC benefits to 
the State agency and of reports of amounts deducted for each individual 
and the total amount transmitted.

[Amdt. 320, 55 FR 6239, Feb. 22, 1990]

    Effective Date Note: By Amdt. 389, 65 FR 41774, July 6, 2000 
Sec. 272.12 was removed. At 65 FR 47587, Aug. 2, 2000, the effective 
date of this removal was corrected to Aug. 1, 2001.

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