[Code of Federal Regulations]
[Title 41, Volume 3]
[Revised as of July 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 41CFR105-55.004]

[Page 268-269]
 
           TITLE 41--PUBLIC CONTRACTS AND PROPERTY MANAGEMENT
 
              CHAPTER 105--GENERAL SERVICES ADMINISTRATION
 
PART 105-55--COLLECTION OF CLAIMS OWED THE UNITED STATES--Table of Contents
 
Sec. 105-55.004  Demand for payment.

    (a) A total of three progressively stronger written demands at 
approximately 30-day intervals will normally be made, unless a response 
or other information indicates that additional written demands would 
either be unnecessary or futile. When necessary to protect the 
Government's interest, written demand may be preceded by other 
appropriate actions under the Federal Claims Collection Standards, 
including immediate referral for litigation and/or offset.
    (b) The initial written demand for payment shall inform the debtor 
of:
    (1) The basis for the claim;
    (2) The amount of the claim;
    (3) The date when payment is due; (30 days from date of mailing or 
hand delivery of the initial demand for payment);
    (4) The provision for interest, penalties, and administrative 
charges in accordance with 31 U.S.C. 3717, if payment is not received by 
the due date (See Sec. 105-55.005 for details regarding interest, 
administrative charges, and penalty charges.)
    (5) The intent of the agency 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, has not requested a review of the claim within the 
agency as set out in paragraph (b)(8) of this section or has not made an 
arrangement for payment by the payment due date;
    (6) The right of the debtor to inspect and copy the records of the 
agency related to the claim. Any costs associated therewith shall be 
borne by the debtor. The debtor shall give reasonable notice in advance 
to the agency of the date upon which it intends to inspect and copy the 
records involved;
    (7) The right of the debtor to a review of the claim within the 
agency. If the claim is disputed in full or part, the debtor shall 
respond to the demand in writing by making a request for a review of the 
claim within the agency by the payment due date stated in the demand. 
The debtor's written response shall state the basis for the dispute. If 
only part of the claim is disputed, the undisputed portion should be 
paid by the date stated in the initial demand. The agency shall 
acknowledge receipt of the request for a review, and upon completion of 
consideration shall notify the debtor whether its determination has been 
sustained, amended, or canceled within 15 days of the receipt of the 
request for a review. If the agency either sustains or amends its 
determination, it shall notify the debtor of its intent to collect by 
administrative offset unless payment is received within 15 days of the 
mailing of the notification of its decision following a review of the 
claim.
    (8) The right of the debtor to offer to make a written agreement to 
repay the amount of the claim. The acceptance of such an agreement is 
discretionary with the agency. If the debtor requests a repayment 
arrangement because a payment of the amount due would create a financial 
hardship, the appropriate GSA Regional Finance Division will analyze the 
debtor's financial condition. Dependent upon the Regional Finance 
Division's evaluation of the financial strength of the debtor, the 
Comptroller or the appropriate designee and the debtor may agree to a 
written installment repayment schedule. The debtor shall execute a 
confess-judgment note which specifies all of

[[Page 269]]

the terms of the arrangement. The size and frequency of installment 
payments should bear a reasonable relation to the size of the debt and 
the debtor's ability to pay. Interest, administrative charges, and 
penalty charges shall be provided for in the note. The debtor shall be 
provided with a written explanation of the consequences of signing a 
confess-judgment note. The debtor shall sign a statement acknowledging 
receipt of the written explanation which shall recite that the statement 
was read and understood before execution of the notice and that the note 
is being signed knowingly and voluntarily. Some form of objective 
evidence of these facts should be maintained in the agency's file on the 
debtor.
    (c) If no response to the demand is received by the date stated in 
the demand, GSA will take further action under this subpart or under the 
Federal Claims Collection Standards. These actions may include reports 
to credit bureaus, referrals to collection agencies, termination of 
contract, debarment, offset of Federal salary, and other administrative 
offset, as authorized in 31 U.S.C. 3701-3719.