7 USC § 2022 - Disposition of claims

(a) General authority of the Secretary

(1) Determination of claims

Except in the case of an at-risk amount required under section 2025 (c)(1)(D)(i)(III) of this title, the Secretary shall have the power to determine the amount of and settle and adjust any claim and to compromise or deny all or part of any such claim or claims arising under the provisions of this chapter or the regulations issued pursuant to this chapter, including, but not limited to, claims arising from fraudulent and nonfraudulent overissuances to recipients, including the power to waive claims if the Secretary determines that to do so would serve the purposes of this chapter. Such powers with respect to claims against recipients may be delegated by the Secretary to State agencies. The Secretary shall have the power to reduce amounts otherwise due to a State agency under section 2025 of this title to collect unpaid claims assessed against the State agency if the State agency has declined or exhausted its appeal rights under section 2023 of this title.

(2) Claims established under quality control system

To the extent that a State agency does not pay a claim established under section 2025 (c)(1) of this title, including an agreement to have all or part of the claim paid through a reduction in Federal administrative funding, within 30 days from the date on which the bill for collection is received by the State agency, the State agency shall be liable for interest on any unpaid portion of such claim accruing from the date on which the bill for collection was received by the State agency, unless the State agency appeals the claim under section 2025 (c)(7) of this title. If the State agency appeals such claim (in whole or in part), the interest on any unpaid portion of the claim shall accrue from the date of the decision on the administrative appeal, or from a date that is 1 year after the date the bill is received, whichever is earlier, until the date the unpaid portion of the payment is received. If the State agency pays such claim (in whole or in part, including an agreement to have all or part of the claim paid through a reduction in Federal administrative funding) and the claim is subsequently overturned through administrative or judicial appeal, any amounts paid by the State agency shall be promptly returned with interest, accruing from the date the payment is received until the date the payment is returned.

(3) Computation of interest

Any interest assessed under this paragraph shall be computed at a rate determined by the Secretary based on the average of the bond equivalent of the weekly 90-day Treasury bill auction rates during the period such interest accrues.

(4) Joint and several liability of household members

Each adult member of a household shall be jointly and severally liable for the value of any overissuance of benefits.

(b) Collection of overissuances

(1) In general

Except as otherwise provided in this subsection, a State agency shall collect any overissuance of benefits issued to a household by—

(A) reducing the allotment of the household;

(B) withholding amounts from unemployment compensation from a member of the household under subsection (c) of this section;

(C) recovering from Federal pay or a Federal income tax refund under subsection (d) of this section; or

(D) any other means.

(2) Cost effectiveness

Paragraph (1) shall not apply if the State agency demonstrates to the satisfaction of the Secretary that all of the means referred to in paragraph (1) are not cost effective.

(3) Maximum reduction absent fraud

If a household received an overissuance of benefits without any member of the household being found ineligible to participate in the program under section 2015 (b)(1) of this title and a State agency elects to reduce the allotment of the household under paragraph (1)(A), the State agency shall not reduce the monthly allotment of the household under paragraph (1)(A) by an amount in excess of the greater of—

(A) 10 percent of the monthly allotment of the household; or

(B) $10.

(4) Procedures

A State agency shall collect an overissuance of benefits issued to a household under paragraph (1) in accordance with the requirements established by the State agency for providing notice, electing a means of payment, and establishing a time schedule for payment.

(5) Overissuances caused by systemic State errors

(A) In general

If the Secretary determines that a State agency overissued benefits to a substantial number of households in a fiscal year as a result of a major systemic error by the State agency, as defined by the Secretary, the Secretary may prohibit the State agency from collecting these overissuances from some or all households.

(B) Procedures

(i) Information reporting by States Every State agency shall provide to the Secretary all information requested by the Secretary concerning the issuance of benefits to households by the State agency in the applicable fiscal year.

(ii) Final determination After reviewing relevant information provided by a State agency, the Secretary shall make a final determination—

(I) whether the State agency overissued benefits to a substantial number of households as a result of a systemic error in the applicable fiscal year; and

(II) as to the amount of the overissuance in the applicable fiscal year for which the State agency is liable.

(iii) Establishing a claim Upon determining under clause (ii) that a State agency has overissued benefits to households due to a major systemic error determined under subparagraph (A), the Secretary shall establish a claim against the State agency equal to the value of the overissuance caused by the systemic error.

(iv) Administrative and judicial review Administrative and judicial review, as provided in section 2023 of this title, shall apply to the final determinations by the Secretary under clause (ii).

(v) Remission to the Secretary

(I) Determination not appealed If the determination of the Secretary under clause (ii) is not appealed, the State agency shall, as soon as practicable, remit to the Secretary the dollar amount specified in the claim under clause (iii).

(II) Determination appealed If the determination of the Secretary under clause (ii) is appealed, upon completion of administrative and judicial review under clause (iv), and a finding of liability on the part of the State, the appealing State agency shall, as soon as practicable, remit to the Secretary a dollar amount subject to the finding made in the administrative and judicial review.

(vi) Alternative method of collection

(I) In general If a State agency fails to make a payment under clause (v) within a reasonable period of time, as determined by the Secretary, the Secretary may reduce any amount due to the State agency under any other provision of this chapter by the amount due.

(II) Accrual of interest During the period of time determined by the Secretary to be reasonable under subclause (I), interest in the amount owed shall not accrue.

(vii) Limitation Any liability amount established under section 2025 (c)(1)(C) of this title shall be reduced by the amount of the claim established under this subparagraph.

(c) Intercept of unemployment benefits

(1) As used in this subsection, the term “uncollected overissuance” means the amount of an overissuance of benefits, as determined under subsection (b)(1) of this section, that has not been recovered pursuant to subsection (b)(1) of this section.

(2) A State agency may determine on a periodic basis, from information supplied pursuant to section 49b (b) of title 29, whether an individual receiving compensation under the State’s unemployment compensation law (including amounts payable pursuant to an agreement under a Federal unemployment compensation law) owes an uncollected overissuance.

(3) A State agency may recover an uncollected overissuance—

(A) by—

(i) entering into an agreement with an individual described in paragraph (2) under which specified amounts will be withheld from unemployment compensation otherwise payable to the individual; and

(ii) furnishing a copy of the agreement to the State agency administering the unemployment compensation law; or

(B) in the absence of an agreement, 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 the unemployment compensation.

(d) Recovery of overissuance of benefits

The amount of an overissuance of benefits, as determined under subsection (b)(1) of this section, that has not been recovered pursuant to such subsection may be recovered from Federal pay (including salaries and pensions) as authorized by section 5514 of title 5 or a Federal income tax refund as authorized by section 3720A of title 31.

Source

(Pub. L. 88–525, § 13,Aug. 31, 1964, 78 Stat. 707; Pub. L. 95–113, title XIII, § 1301,Sept. 29, 1977, 91 Stat. 974; Pub. L. 97–35, title I, § 113,Aug. 13, 1981, 95 Stat. 363; Pub. L. 97–253, title I, §§ 177, 178,Sept. 8, 1982, 96 Stat. 781, 782; Pub. L. 99–198, title XV, §§ 1533–1535(a),Dec. 23, 1985, 99 Stat. 1583; Pub. L. 100–435, title VI, §§ 601, 602,Sept. 19, 1988, 102 Stat. 1674; Pub. L. 101–624, title XVII, § 1746,Nov. 28, 1990, 104 Stat. 3796; Pub. L. 102–237, title IX, § 911,Dec. 13, 1991, 105 Stat. 1887; Pub. L. 103–66, title XIII, §§ 13941(b), 13951(a),Aug. 10, 1993, 107 Stat. 676, 677; Pub. L. 104–193, title VIII, § 844(a),Aug. 22, 1996, 110 Stat. 2332; Pub. L. 107–171, title IV, § 4118(b),May 13, 2002, 116 Stat. 321; Pub. L. 110–234, title IV, §§ 4115(b)(9), 4133,May 22, 2008, 122 Stat. 1107, 1116; Pub. L. 110–246, § 4(a), title IV, §§ 4115(b)(9), 4133,June 18, 2008, 122 Stat. 1664, 1869, 1877.)

Codification

Pub. L. 110–234and Pub. L. 110–246made identical amendments to this section. The amendments by Pub. L. 110–234were repealed by section 4(a) ofPub. L. 110–246.

Amendments

2008—Pub. L. 110–246, § 4115(b)(9), substituted “benefits” for “coupons” wherever appearing.

Subsec. (b)(5). Pub. L. 110–246, § 4133, added par. (5).

2002—Subsec. (a). Pub. L. 107–171, inserted subsec. (a) heading, redesignated par. (2) as (4) and inserted heading, designated existing provisions of par. (1) as pars. (1) to (3) and inserted headings, in par. (1) substituted “Except in the case of an at-risk amount required under section 2025 (c)(1)(D)(i)(III) of this title, the Secretary” for “The Secretary” and struck out “In determining whether to settle, adjust, compromise, or waive a claim arising against a State agency pursuant to section 2025 (c) of this title, the Secretary shall review a State agency’s plans for new dollar investment in activities to improve program administration in order to reduce payment error, and shall take the State agency’s plans for new dollar investment in such activities into consideration as the Secretary considers appropriate.” after “section 2023 of this title.”, and in par. (2) substituted “claim established under section 2025 (c)(1) of this title” for “claim established under section 2025 (c)(1)(C) of this title”.

1996—Subsec. (b). Pub. L. 104–193, § 844(a)(1), added subsec. (b) and struck out former subsec. (b) which provided for reduction of allotment for households with ineligible individuals and collection by State agencies of claims against households arising from overissuance of coupons.

Subsec. (d). Pub. L. 104–193, § 844(a)(2), substituted “, as determined under subsection (b)(1) of this section,” for “as determined under subsection (b) of this section and except for claims arising from an error of the State agency,” and inserted before period at end “or a Federal income tax refund as authorized by section 3720A of title 31”.

1993—Subsec. (a)(1). Pub. L. 103–66, § 13951(a), in fifth sentence, struck out “(after a determination on any request for a waiver for good cause related to the claim has been made by the Secretary)” after “30 days from the date on which the bill for collection” and in sixth sentence substituted “1 year” for “2 years”.

Subsec. (d). Pub. L. 103–66, § 13941(b), added subsec. (d).

1991—Subsec. (b)(2)(A). Pub. L. 102–237inserted before period at end of first sentence “, except that the household shall be given notice permitting it to elect another means of repayment and given 10 days to make such an election before the State agency commences action to reduce the household’s monthly allotment”.

1990—Subsec. (b)(1)(A). Pub. L. 101–624substituted “on the date of receipt (or, if the date of receipt is not a business day, on the next business day)” for “within thirty days”.

1988—Subsec. (a)(1). Pub. L. 100–435, § 601, inserted provisions relating to review of State agency’s plans for program investment to reduce payment error when Secretary determines whether to settle, etc., claims under section 2025 (c) of this title.

Pub. L. 100–435, § 602, inserted provisions relating to failure of State agency to pay a claim under section 2025 (c)(1)(C) of this title and interest with respect to unpaid portion of such claims.

1985—Subsec. (a). Pub. L. 99–198, § 1533, designated existing provisions as par. (1) and added par. (2).

Subsec. (b)(1)(B). Pub. L. 99–198, § 1534, substituted “shall” for “may” and inserted “, unless the State agency demonstrates to the satisfaction of the Secretary that such other means are not cost effective”.

Subsec. (c). Pub. L. 99–198, § 1535(a), added subsec. (c).

1982—Subsec. (b)(1). Pub. L. 97–253, §§ 177(a), 178, redesignated existing provisions, which were formerly undesignated, as subpar. (A), inserted “within thirty days of a demand for an election” after “make an election”, and added subpar. (B).

Subsec. (b)(2). Pub. L. 97–253, § 177(b), redesignated existing provisions, which had been undesignated, as subpar. (A) and added subpar. (B).

1981—Pub. L. 97–35designated existing provisions as subsec. (a), inserted provisions relating to power to waive claims, and the power to otherwise reduce amounts, and added subsec. (b).

1977—Pub. L. 95–113substituted revised provisions relating to the determination and disposition of claims for provisions relating to administrative and judicial review which are now covered by section 2023 of this title.

Effective Date of 2008 Amendment

Amendment of this section and repeal of Pub. L. 110–234by Pub. L. 110–246effective May 22, 2008, the date of enactment of Pub. L. 110–234, except as otherwise provided, see section 4 ofPub. L. 110–246, set out as an Effective Date note under section 8701 of this title.

Amendment by sections 4115(b)(9) and 4133 ofPub. L. 110–246effective Oct. 1, 2008, see section 4407 ofPub. L. 110–246, set out as a note under section 1161 of Title 2, The Congress.

Effective Date of 2002 Amendment

Pub. L. 107–171, title IV, § 4118(e),May 13, 2002, 116 Stat. 321, provided that: “The amendments made by this section [amending this section and sections 2025, 2027, and 2031 of this title] shall not apply with respect to any sanction, appeal, new investment agreement, or other action by the Secretary of Agriculture or a State agency that is based on a payment error rate calculated for any fiscal year before fiscal year 2003.”

Amendment by Pub. L. 107–171effective Oct. 1, 2002, except as otherwise provided, see section 4405 ofPub. L. 107–171, set out as an Effective Date note under section 1161 of Title 2, The Congress.

Effective Date of 1993 Amendment

Amendment by section 13941(b) ofPub. L. 103–66effective, and to be implemented beginning on, Oct. 1, 1993, and amendment by section 13951(a) ofPub. L. 103–66effective Oct. 1, 1991, see section 13971(a), (b)(1)(A) ofPub. L. 103–66, set out as a note under section 2025 of this title.

Effective Date of 1991 Amendment

Amendment by Pub. L. 102–237effective Dec. 13, 1991, see section 1101(d)(4) ofPub. L. 102–237, set out as a note under section 1421 of this title.

Effective Date of 1988 Amendment

Amendment by Pub. L. 100–435effective Oct. 1, 1985, with respect to claims under section 2025 (c) of this title for quality control review periods after such date, and provisions of this section that relate to claims against State agencies and that were in effect for any quality control review period or periods through fiscal year 1985 to remain in effect for claims arising with respect to such periods, see section 701(b)(5)(B), (D)(i) ofPub. L. 100–435, set out as a note under section 2012 of this title.

Effective Date of 1982 Amendment

Amendment by Pub. L. 97–253effective Sept. 8, 1982, see section 193(a) ofPub. L. 97–253, set out as a note under section 2012 of this title.

Effective Date of 1981 Amendment

Amendment by Pub. L. 97–35effective on earlier of Sept. 8, 1982, or date such amendment became effective pursuant to section 117 ofPub. L. 97–35, set out as a note under section 2012 of this title, see section 192(a) ofPub. L. 97–253, set out as a note under section 2012 of this title.

Amendment by Pub. L. 97–35effective and implemented upon such dates as Secretary of Agriculture may prescribe, taking into account need for orderly implementation, see section 117 ofPub. L. 97–35, set out as a note under section 2012 of this title.

Effective Date of 1977 Amendment

Section 1301 ofPub. L. 95–113provided that the amendment made by that section is effective Oct. 1, 1977.