[Code of Federal Regulations]
[Title 45, Volume 4]
[Revised as of October 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 45CFR2506.18]

[Page 565]
 
                        TITLE 45--PUBLIC WELFARE
 
       CHAPTER XXV--CORPORATION FOR NATIONAL AND COMMUNITY SERVICE
 
PART 2506_COLLECTION OF DEBTS--Table of Contents
 
                      Subpart B_General Provisions.
 
Sec. 2506.18  What interest, penalty charges, and administrative costs 
will I have to pay on a debt owed to the Corporation?

    (a) Interest. (1) The Corporation will assess interest on all 
delinquent debts unless prohibited by statute, regulation, or contract.
    (2) Interest begins to accrue on all debts from the date that the 
debt becomes delinquent. The Corporation will not recover interest if 
you pay the debt within 30 days of the date on which interest begins to 
accrue. The Corporation will assess interest at the rate established 
annually by the Secretary of the Treasury under 31 U.S.C. 3717, unless a 
different rate is either necessary to protect the interests of the 
Corporation or established by a contract, repayment agreement, or 
statute. The Corporation will notify you of the basis for its finding 
when a different rate is necessary to protect the interests of the 
Corporation.
    (3) The Chief Executive Officer may extend the 30-day period for 
payment without interest when he or she determines that such action is 
in the best interest of the Corporation. A decision to extend or not to 
extend the payment period is final and is not subject to further review.
    (b) Penalty. The Corporation will assess a penalty charge of 6 
percent a year on any portion of a debt that is delinquent for more than 
90 days.
    (c) Administrative costs. The Corporation will assess charges to 
cover administrative costs incurred as a result of your failure to pay a 
debt before it becomes delinquent. Administrative costs include the 
additional costs incurred in processing and handling the debt because it 
became delinquent, such as costs incurred in obtaining a credit report 
or in using a private collection contractor, or service fees charged by 
a Federal agency for collection activities undertaken on behalf of the 
Corporation.
    (d) Allocation of payments. A partial or installment payment by a 
debtor will be applied first to outstanding penalty assessments, second 
to administrative costs, third to accrued interest, and fourth to the 
outstanding debt principal.
    (e) Additional authority. The Corporation may assess interest, 
penalty charges, and administrative costs on debts that are not subject 
to 31 U.S.C. 3717 to the extent authorized under common law or other 
applicable statutory authority.
    (f) Waiver. (1) The Chief Executive Officer may (without regard to 
the amount of the debt) waive collection of all or part of accrued 
interest, penalty charges, or administrative costs, if he or she 
determines that collection of these charges would be against equity and 
good conscience or not in the best interest of the Corporation.
    (2) A decision to waive interest, penalty charges, or administrative 
costs may be made at any time before a debt is paid. However, and unless 
otherwise stated in these regulations, where these charges have been 
collected before the waiver decision, they will not be refunded. The 
Chief Executive Officer's decision to waive or not waive collection of 
these charges is final and is not subject to further review.