[Code of Federal Regulations]
[Title 22, Volume 1]
[Revised as of April 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 22CFR34.9]

[Page 139]
 
                       TITLE 22--FOREIGN RELATIONS
 
                     CHAPTER I--DEPARTMENT OF STATE
 
PART 34--COLLECTION OF DEBTS--Table of Contents
 
  Subpart B--Administrative Offset and Referral to Collection Agencies
 
Sec. 34.9  Collection by administrative offset.

    (a) Offset will be used whenever feasible and not otherwise 
prohibited. Offset is not required to be used in every instance and 
consideration should be given to the debtor's financial condition and 
the impact of offset on STATE programs or projects.
    (b) The procedures for offset in this section do not apply to the 
offset of Federal salaries under 5 U.S.C. 5514.
    (c) Before offset is made, STATE will provide the debtor with 
written notice informing the debtor of:
    (1) The nature and amount of the claim;
    (2) The intent of STATE to collect by administrative offset, 
including asking the assistance of other Federal agencies to help in the 
offset whenever possible, if the debtor has not made payment by the 
payment due date or has not made an arrangement for payment by the 
payment due date;
    (3) The right of the debtor to inspect and copy STATE's records of 
the claim;
    (4) The right of the debtor to a review of the claim within STATE. 
If the claim is disputed in full or part, the debtor shall respond to 
the demand in writing by making a request by the payment due date stated 
within the notice to the billing office for a review of the claim within 
STATE. The debtor's written response shall state the basis for the 
dispute. If only part of the claim is disputed, the undisputed portion 
must be paid by the date stated in the notice to avoid late payment, 
penalty and administrative charges. If STATE either sustains or amends 
its determination, it shall notify the debtor of its intent to collect 
the claim, with any adjustments based on the debtor's response by 
administrative offset unless payment is received within 30-days of the 
mailing of the notification of its decision following a review of the 
claim.
    (5) The right of the debtor to offer to make a written agreement to 
repay the amount of the claim.
    (6) The notice of offset need not include the requirements of 
paragraphs (c) (3), (4), or (5) of this section if the debtor has been 
informed of the requirements at an earlier stage in the administrative 
proceedings, e.g., if they were included in a final contracting 
officer's decision.
    (d) STATE will promptly make requests for offset to other agencies 
known to be holding funds payable to a debtor and, when appropriate, 
place the name of the debtor on the ``List of Contractors Indebted to 
the United States''. STATE will provide instructions for the transfer of 
funds.
    (e) STATE will promptly process requests for offset from other 
agencies and transfer funds to the requesting agency upon receipt of the 
written certification that the person owes the debt and that, if a 
Federal employee, the employee has been given the procedural rights 
required by 5 USC 5514 and 5 CFR part 550, subpart K.