Citations

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TITLE 31—MONEY AND FINANCE

ments’’ for clarity and consistency. The words ‘‘in behalf of the United States’’ are omitted as surplus. The
words ‘‘for the property’’ are added for clarity. The
word ‘‘property’’ is substituted for ‘‘such estate’’ for
consistency in the section. The words ‘‘Whenever such
purchase is made’’ are omitted as surplus. The words
‘‘transfer the property’’ are substituted for ‘‘make all
needful conveyances, assignments, or transfers’’ to
eliminate unnecessary words and for clarity.

§ 3716. Administrative offset
(a) After trying to collect a claim from a person under section 3711(a) of this title, the head
of an executive, judicial, or legislative agency
may collect the claim by administrative offset.
The head of the agency may collect by administrative offset only after giving the debtor—
(1) written notice of the type and amount of
the claim, the intention of the head of the
agency to collect the claim by administrative
offset, and an explanation of the rights of the
debtor under this section;
(2) an opportunity to inspect and copy the
records of the agency related to the claim;
(3) an opportunity for a review within the
agency of the decision of the agency related to
the claim; and
(4) an opportunity to make a written agreement with the head of the agency to repay the
amount of the claim.
(b) Before collecting a claim by administrative
offset, the head of an executive, judicial, or legislative agency must either—
(1) adopt, without change, regulations on
collecting by administrative offset promulgated by the Department of Justice, the Government Accountability Office, or the Department of the Treasury; or
(2) prescribe regulations on collecting by administrative offset consistent with the regulations referred to in paragraph (1).
(c)(1)(A) Except as otherwise provided in this
subsection, a disbursing official of the Department of the Treasury, the Department of Defense, the United States Postal Service, the Department of Health and Human Services, or any
other government corporation, or any disbursing
official of the United States designated by the
Secretary of the Treasury, shall offset at least
annually the amount of a payment which a payment certifying agency has certified to the disbursing official for disbursement, by an amount
equal to the amount of a claim which a creditor
agency has certified to the Secretary of the
Treasury pursuant to this subsection.
(B) An agency that designates disbursing officials pursuant to section 3321(c) of this title is
not required to certify claims arising out of its
operations to the Secretary of the Treasury before such agency’s disbursing officials offset
such claims.
(C) Payments certified by the Department of
Education under a program administered by the
Secretary of Education under title IV of the
Higher Education Act of 1965 shall not be subject
to administrative offset under this subsection.
(2) Neither the disbursing official nor the payment certifying agency shall be liable—
(A) for the amount of the administrative offset on the basis that the underlying obligation, represented by the payment before the

§ 3716

administrative offset was taken, was not satisfied; or
(B) for failure to provide timely notice under
paragraph (8).
(3)(A)(i) Notwithstanding any other provision
of law (including sections 207 and 1631(d)(1) of
the Social Security Act (42 U.S.C. 407 and
1383(d)(1)), section 413(b) of Public Law 91–173 (30
U.S.C. 923(b)), and section 14 of the Act of August 29, 1935 (45 U.S.C. 231m)), except as provided
in clause (ii), all payments due to an individual
under—
(I) the Social Security Act,
(II) part B of the Black Lung Benefits Act,
or
(III) any law administered by the Railroad
Retirement Board (other than payments that
such Board determines to be tier 2 benefits),
shall be subject to offset under this section.
(ii) An amount of $9,000 which a debtor may receive under Federal benefit programs cited
under clause (i) within a 12-month period shall
be exempt from offset under this subsection. In
applying the $9,000 exemption, the disbursing official shall—
(I) reduce the $9,000 exemption amount for
the 12-month period by the amount of all Federal benefit payments made during such 12month period which are not subject to offset
under this subsection; and
(II) apply a prorated amount of the exemption to each periodic benefit payment to be
made to the debtor during the applicable 12month period.
For purposes of the preceding sentence, the
amount of a periodic benefit payment shall be
the amount after any reduction or deduction required under the laws authorizing the program
under which such payment is authorized to be
made (including any reduction or deduction to
recover any overpayment under such program).
(B) The Secretary of the Treasury shall exempt from administrative offset under this subsection payments under means-tested programs
when requested by the head of the respective
agency. The Secretary may exempt other payments from administrative offset under this subsection upon the written request of the head of
a payment certifying agency. A written request
for exemption of other payments must provide
justification for the exemption under standards
prescribed by the Secretary. Such standards
shall give due consideration to whether administrative offset would tend to interfere substantially with or defeat the purposes of the payment certifying agency’s program. The Secretary shall report to the Congress annually on
exemptions granted under this section.
(C) The provisions of sections 205(b)(1),
809(a)(1), and 1631(c)(1) of the Social Security
Act shall not apply to any administrative offset
executed pursuant to this section against benefits authorized by title II, VIII, or title XVI of
the Social Security Act, respectively.
(D) This section shall apply to payments made
after the date which is 90 days after the enactment of this subparagraph (or such earlier date
as designated by the Secretary of Health and
Human Services) with respect to claims or
debts, and to amounts payable, under title XVIII
of the Social Security Act.

§ 3716

TITLE 31—MONEY AND FINANCE

(4) The Secretary of the Treasury may charge
a fee sufficient to cover the full cost of implementing this subsection. The fee may be collected either by the retention of a portion of
amounts collected pursuant to this subsection,
or by billing the agency referring or transferring
a claim for those amounts. Fees charged to the
agencies shall be based on actual administrative
offsets completed. Amounts received by the
United States as fees under this subsection shall
be deposited into the account of the Department
of the Treasury under section 3711(g)(7) of this
title, and shall be collected and accounted for in
accordance with the provisions of that section.
(5) The Secretary of the Treasury in consultation with the Commissioner of Social Security
and the Director of the Office of Management
and Budget, may prescribe such rules, regulations, and procedures as the Secretary of the
Treasury considers necessary to carry out this
subsection. The Secretary shall consult with the
heads of affected agencies in the development of
such rules, regulations, and procedures.
(6) Any Federal agency that is owed by a person a past due, legally enforceable nontax debt
that is over 180 days delinquent, including
nontax debt administered by a third party acting as an agent for the Federal Government,
shall notify the Secretary of the Treasury of all
such nontax debts for purposes of administrative
offset under this subsection.
(7)(A) The disbursing official conducting an
administrative offset with respect to a payment
to a payee shall notify the payee in writing of—
(i) the occurrence of the administrative offset to satisfy a past due legally enforceable
debt, including a description of the type and
amount of the payment otherwise payable to
the payee against which the offset was executed;
(ii) the identity of the creditor agency requesting the offset; and
(iii) a contact point within the creditor
agency that will handle concerns regarding
the offset.
(B) If the payment to be offset is a periodic
benefit payment, the disbursing official shall
take reasonable steps, as determined by the Secretary of the Treasury, to provide the notice to
the payee not later than the date on which the
payee is otherwise scheduled to receive the payment, or as soon as practical thereafter, but no
later than the date of the administrative offset.
Notwithstanding the preceding sentence, the
failure of the debtor to receive such notice shall
not impair the legality of such administrative
offset.
(8) A levy pursuant to the Internal Revenue
Code of 1986 shall take precedence over requests
for administrative offset pursuant to other laws.
(d) Nothing in this section is intended to prohibit the use of any other administrative offset
authority existing under statute or common
law.
(e)(1) Notwithstanding any other provision of
law, regulation, or administrative limitation, no
limitation on the period within which an offset
may be initiated or taken pursuant to this section shall be effective.
(2) This section does not apply when a statute
explicitly prohibits using administrative offset

Page 272

or setoff to collect the claim or type of claim involved.
(f) The Secretary may waive the requirements
of sections 552a(o) and (p) of title 5 for administrative offset or claims collection upon written
certification by the head of a State or an executive, judicial, or legislative agency seeking to
collect the claim that the requirements of subsection (a) of this section have been met.
(g) The Data Integrity Board of the Department of the Treasury established under 552a(u)
of title 5 shall review and include in reports
under paragraph (3)(D) of that section a description of any matching activities conducted under
this section. If the Secretary has granted a
waiver under subsection (f) of this section, no
other Data Integrity Board is required to take
any action under section 552a(u) of title 5.
(h)(1) The Secretary may, in the discretion of
the Secretary, apply subsection (a) with respect
to any past-due, legally-enforceable debt owed
to a State if—
(A) the appropriate State disbursing official
requests that an offset be performed; and
(B) a reciprocal agreement with the State is
in effect which contains, at a minimum—
(i) requirements substantially equivalent
to subsection (b) of this section; and
(ii) any other requirements which the Secretary considers appropriate to facilitate the
offset and prevent duplicative efforts.
(2) This subsection does not apply to—
(A) the collection of a debt or claim on
which the administrative costs associated
with the collection of the debt or claim exceed
the amount of the debt or claim;
(B) any collection of any other type, class,
or amount of claim, as the Secretary considers
necessary to protect the interest of the United
States; or
(C) the disbursement of any class or type of
payment exempted by the Secretary of the
Treasury at the request of a Federal agency.
(3) In applying this section with respect to any
debt owed to a State, subsection (c)(3)(A) shall
not apply.
(Added Pub. L. 97–452, § 1(16)(A), Jan. 12, 1983, 96
Stat. 2471; amended Pub. L. 104–134, title III,
§ 31001(c)(1), (d)(2), (e), (f), Apr. 26, 1996, 110 Stat.
1321–359, 1321–362; Pub. L. 106–169, title II,
§ 251(b)(10), Dec. 14, 1999, 113 Stat. 1856; Pub. L.
108–271, § 8(b), July 7, 2004, 118 Stat. 814; Pub. L.
110–234, title XIV, § 14219(a), May 22, 2008, 122
Stat. 1482; Pub. L. 110–246, § 4(a), title XIV,
§ 14219(a), June 18, 2008, 122 Stat. 1664, 2244; Pub.
L. 110–275, title I, § 189(b), July 15, 2008, 122 Stat.
2590.)
HISTORICAL AND REVISION NOTES
Revised
Section

Source (U.S. Code)

Source (Statutes at Large)

3716(a) .....

31 App.:954(a)
(words before last
comma), (c).

July 19, 1966, Pub. L. 89–508, 80
Stat. 308, § 5(a)–(d); added
Oct. 25, 1982, Pub. L. 97–365,
§ 10(2), 96 Stat. 1754.

3716(b) .....
3716(c)(1)

31 App.:954(b).
31 App.:954(a)
(words after last
comma).
31 App.:954(d).

3716(c)(2)

In the subchapter, the words ‘‘or his designee’’ are
omitted as unnecessary.

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TITLE 31—MONEY AND FINANCE

In subsection (a)(1), the words ‘‘head of the’’ are
added for consistency in the revised title and with
other titles of the United States Code.
In subsection (b)(1), the word ‘‘Government’’ is added
for consistency in the revised title and with other titles
of the Code.
In subsection (b)(3), the word ‘‘civil’’ is added for consistency in the revised title and with other titles of the
Code.
In subsection (c)(2), the word ‘‘either’’ is omitted as
surplus.
REFERENCES IN TEXT
The Higher Education Act of 1965, referred to in subsec. (c)(1)(C), is Pub. L. 89–329, Nov. 8, 1965, 79 Stat. 1219,
as amended. Title IV of the Act is classified generally
to subchapter IV (§ 1070 et seq.) of chapter 28 of Title 20,
Education, and part C (§ 2751 et seq.) of subchapter I of
chapter 34 of Title 42, The Public Health and Welfare.
For complete classification of this Act to the Code, see
Short Title note set out under section 1001 of Title 20
and Tables.
The Social Security Act, referred to in subsec.
(c)(3)(A)(i)(I), (C), (D), is act Aug. 14, 1935, ch. 531, 49
Stat. 620, which is classified generally to chapter 7 (§ 301
et seq.) of Title 42, The Public Health and Welfare.
Titles II, VIII, XVI, and XVIII of the Act are classified
generally to subchapters II (§ 401 et seq.), VIII (§ 1001 et
seq.), XVI (§ 1381 et seq.), and XVIII (§ 1395 et seq.), respectively, of chapter 7 of Title 42. Sections 205(b)(1),
809(a)(1), and 1631(c)(1) of the Act are classified to sections 405(b)(1), 1009(a)(1), and 1383(c)(1), respectively, of
Title 42. For complete classification of this Act to the
Code, see section 1305 of Title 42 and Tables.
The Black Lung Benefits Act, referred to in subsec.
(c)(3)(A)(i)(II), is title IV of Pub. L. 91–173, Dec. 30, 1969,
83 Stat. 792, as amended. Part B of the Act is classified
generally to part B (§ 921 et seq.) of subchapter IV of
chapter 22 of Title 30, Mineral Lands and Mining. For
complete classification of this Act to the Code, see section 901(b) of Title 30 and Tables.
The enactment of this subparagraph, referred to in
subsec. (c)(3)(D), refers to the date of enactment of Pub.
L. 110–275, which was approved July 15, 2008.
The Internal Revenue Code of 1986, referred to in subsec. (c)(8), is classified to Title 26, Internal Revenue
Code.
CODIFICATION
Pub. L. 110–234 and Pub. L. 110–246 made identical
amendments to this section. The amendments by Pub.
L. 110–234 were repealed by section 4(a) of Pub. L.
110–246.
AMENDMENTS
2008—Subsec. (c)(1)(A). Pub. L. 110–275, § 189(b)(1), inserted ‘‘the Department of Health and Human Services,’’ after ‘‘United States Postal Service,’’.
Subsec. (c)(3)(D). Pub. L. 110–275, § 189(b)(2), added subpar. (D).
Subsec. (e). Pub. L. 110–246, § 14219(a), amended subsec.
(e) generally. Prior to amendment, subsec. (e) read as
follows: ‘‘This section does not apply—
‘‘(1) to a claim under this subchapter that has been
outstanding for more than 10 years; or
‘‘(2) when a statute explicitly prohibits using administrative offset or setoff to collect the claim or
type of claim involved.’’
2004—Subsec. (b)(1). Pub. L. 108–271 substituted ‘‘Government Accountability Office’’ for ‘‘General Accounting Office’’.
1999—Subsec. (c)(3)(C). Pub. L. 106–169 substituted
‘‘sections 205(b)(1), 809(a)(1),’’ for ‘‘sections 205(b)(1)’’
and ‘‘title II, VIII,’’ for ‘‘either title II’’.
1996—Subsec. (a). Pub. L. 104–134, § 31001(c)(1), substituted ‘‘the head of an executive, judicial, or legislative agency’’ for ‘‘the head of an executive or legislative agency’’ in introductory provisions.
Subsec. (b). Pub. L. 104–134, § 31001(d)(2)(A), amended
subsec. (b) generally. Prior to amendment, subsec. (b)

§ 3716

read as follows: ‘‘Before collecting a claim by administrative offset under subsection (a) of this section, the
head of an executive or legislative agency must prescribe regulations on collecting by administrative offset based on—
‘‘(1) the best interests of the United States Government;
‘‘(2) the likelihood of collecting a claim by administrative offset; and
‘‘(3) for collecting a claim by administrative offset
after the 6-year period for bringing a civil action on
a claim under section 2415 of title 28 has expired, the
cost effectiveness of leaving a claim unresolved for
more than 6 years.’’
Pub. L. 104–134, § 31001(c)(1), substituted ‘‘the head of
an executive, judicial, or legislative agency’’ for ‘‘the
head of an executive or legislative agency’’ in introductory provisions.
Subsec. (c). Pub. L. 104–134, § 31001(d)(2)(D), added subsec. (c). Former subsec. (c) redesignated (e).
Subsec. (c)(2). Pub. L. 104–134, § 31001(d)(2)(B), amended par. (2) generally. Prior to amendment, par. (2) read
as follows: ‘‘when a statute explicitly provides for or
prohibits using administrative offset to collect the
claim or type of claim involved.’’
Subsec. (d). Pub. L. 104–134, § 31001(d)(2)(D), added subsec. (d).
Subsec. (e). Pub. L. 104–134, § 31001(d)(2)(C), redesignated subsec. (c) as (e).
Subsecs. (f) to (h). Pub. L. 104–134, § 31001(e), (f), added
subsecs. (f) to (h).
EFFECTIVE DATE OF 2008 AMENDMENT
Pub. L. 110–275, title I, § 189(c), July 15, 2008, 122 Stat.
2591, provided that: ‘‘The amendments made by this
section [amending this section and section 1395kk of
Title 42, The Public Health and Welfare] shall take effect on the date of the enactment of this Act [July 15,
2008].’’
Amendment of this section and repeal of Pub. L.
110–234 by Pub. L. 110–246 effective May 22, 2008, the
date of enactment of Pub. L. 110–234, except as otherwise provided, see section 4 of Pub. L. 110–246, set out
as an Effective Date note under section 8701 of Title 7,
Agriculture.
Pub. L. 110–234, title XIV, § 14219(b), May 22, 2008, 122
Stat. 1483, and Pub. L. 110–246, § 4(a), title XIV,
§ 14219(b), June 18, 2008, 122 Stat. 1664, 2245, provided
that: ‘‘The amendment made by subsection (a) [amending this section] shall apply to any debt outstanding on
or after the date of the enactment of this Act [June 18,
2008].’’
[Pub. L. 110–234 and Pub. L. 110–246 enacted identical
provisions. Pub. L. 110–234 was repealed by section 4(a)
of Pub. L. 110–246, set out as a note under section 8701
of Title 7, Agriculture.]
OFFSETS FROM SOCIAL SECURITY PAYMENTS
Pub. L. 104–134, title III, § 31001(a)(2)(B), Apr. 26, 1996,
110 Stat. 1321–358, provided that: ‘‘Subparagraph (A) of
section 3716(c)(3) of title 31, United States Code (as
added by subsection (d)(2) of this section), shall apply
only to payments made after the date which is 4
months after the date of the enactment of this Act
[Apr. 26, 1996].’’
EX. ORD. NO. 13019. SUPPORTING FAMILIES: COLLECTING
DELINQUENT CHILD SUPPORT OBLIGATIONS
Ex. Ord. No. 13019, Sept. 28, 1996, 61 F.R. 51763, provided that:
The Debt Collection Improvement Act of 1996, Public
Law 104–134 [§ 31001] (110 Stat. 1321–358 et seq.) [see Short
Title of 1996 Amendment note set out under section 3701
of this title], was enacted into law on April 26, 1996, as
part of the Omnibus Consolidated Rescissions and Appropriations Act of 1996. While the primary purpose of
the Debt Collection Improvement Act is to increase the
collection of nontax debts owed to the Federal Government, the Act also contains important provisions that

§ 3716

TITLE 31—MONEY AND FINANCE

can be used to assist families in collecting past-due
child support obligations.
The failure of some parents to meet their child support obligations threatens the health, education, and
well-being of their children. Compounding this problem, States have experienced difficulties enforcing
child support obligations once a parent has moved to
another State. With this Executive order, my Administration takes additional steps to support our children
and strengthen American families by facilitating the
collection of delinquent child support obligations from
persons who may be entitled or eligible to receive certain Federal payments or Federal assistance.
Accordingly, by the authority vested in me as President by the Constitution and the laws of the United
States of America, it is hereby ordered as follows:
SECTION 1. Administrative Offsets. (a)(1) The Secretary
of the Treasury (‘‘the Secretary’’), in accordance with
the provisions of the Debt Collection Improvement Act
of 1996 and to the extent permitted by law, and in consultation with the Secretary of Health and Human
Services and other affected agencies, shall promptly develop and implement procedures necessary for the Secretary to collect past-due child support debts by administrative offset, and shall issue such rules, regulations,
and procedures as the Secretary, in consultation with
the heads of affected agencies, deems appropriate to
govern administrative offsets by the Department of the
Treasury and other executive departments and agencies
that disburse Federal payments.
(2) The Secretary may enter into reciprocal agreements with States concerning the collection by the
Secretary of delinquent child support debts through administrative offsets.
(b) The Secretary of Health and Human Services
shall, within 120 days of the date of this order, implement procedures necessary to report to the Secretary
of the Treasury information on past-due child support
claims referred by States (including claims enforced by
States pursuant to cooperative agreements with or by
Indian tribal governments) to the Department of
Health and Human Services.
(c) The head of each executive department and agency that certifies payments to the Secretary or to another disbursing official shall review each class of payments that the department or agency certifies to determine if any such class should be exempt from offset
and, if any class is so identified, submit to the Secretary a request for such an exemption together with
the reasons therefor. With respect to classes of payments under means-tested programs existing on the
date of this order, such submission shall be made within 30 days of the date of this order. With respect to
classes of payments other than payments under meanstested programs existing on the date of this order, such
submissions shall be made within 30 days of the date
the Secretary establishes standards pursuant to section
3716(c)(3) of title 31, United States Code. With respect
to a class of payments established after the date of this
order, such submissions shall be made not later than 30
days after such class is established.
(d) The head of each executive department and agency that certifies payments to the Secretary shall
promptly implement any rule, regulation, or procedure
issued by the Secretary pursuant to this section.
(e) The head of each executive department and agency that is authorized by law to disburse payments shall
promptly implement any rule, regulation, or procedure
issued by the Secretary pursuant to this section and
shall:
(1) match, consistent with computer privacy matching laws, the payment certification records of such department or agency with records of persons delinquent
in child support payments as directed by the Secretary;
and
(2) conduct administrative offsets to collect delinquent child support payments.
(f) The Secretary shall, to the extent permitted by
law, share with the Secretary of Health and Human
Services any information contained in payment certifi-

Page 274

cation records of persons who are delinquent in child
support obligations that would assist in the collection
of such debts, whether or not an administrative offset
is conducted.
SEC. 2. Denial of Federal Assistance. (a) The Secretary
shall, to the extent permitted by law, ensure that information concerning individuals whose payments are
subject to administrative offset because of delinquent
child support obligations is made available to the head
of each executive department and agency that provides
Federal financial assistance to individuals.
(b) In conformance with section 2(e) of this order, the
head of each executive department and agency shall,
with respect to any individuals whose payments are
subject to administrative offset because of a delinquent
child support obligation, promptly implement procedures to deny Federal financial assistance to such individuals.
(c) The Attorney General, in consultation with the
Secretary of Health and Human Services and other affected agencies, shall promptly issue guidelines for departments and agencies concerning minimum due-process standards to be included in the procedures required
by subsection (b) of this section.
(d) For purposes of this section, Federal financial assistance means any Federal loan (other than a disaster
loan), loan guarantee, or loan insurance.
(e)(1) A class of Federal financial assistance shall not
be subject to denial if the head of the concerned department or agency determines:
(A) in consultation with the Attorney General and
the Secretary of Health and Human Services, that such
action:
(i) is not permitted by law; or
(ii) would likely result in valid legal claims for damages against the United States;
(B) that such action would be inconsistent with the
best interests of the child or children with respect to
whom a child support obligation is owed; or
(C) that such action should be waived.
(2) The head of each executive department and agency shall provide written notification to the Secretary
upon determining that the denial of a class of Federal
financial assistance is not permitted by law or should
be waived.
(f) The head of each executive department and agency
shall:
(1) review all laws under the jurisdiction of the department or agency that do not permit the denial of
Federal financial assistance to individuals and whose
payments are subject to administrative offset because
of a delinquent child support obligation and, where appropriate, transmit to the Director of the Office of
Management and Budget recommendations for statutory changes; and
(2) to the extent practicable, review all rules, regulations, and procedures implementing laws under the jurisdiction of the department or agency governing the
provision of any Federal financial assistance to individuals and, where appropriate, conform such rules, regulations, and procedures to the provisions of this order
and the rules, regulations, and procedures issued by the
Secretary pursuant to section 1 of this order.
SEC. 3. Reports. (a) The head of each executive department and agency shall provide to the Secretary such
information as the Secretary may request concerning
the implementation of this order, the provisions of the
Debt Collection Improvement Act of 1996 applicable to
delinquent child support obligations, and the rules, regulations, and procedures issued by the Secretary pursuant to section 1 of this order.
(b) The Secretary shall report annually to the President concerning the implementation by departments
and agencies of this order and the provisions of the
Debt Collection Improvement Act of 1996 applicable to
delinquent child support obligations.
SEC. 4. Judicial Review. This order does not create any
right or benefit, substantive or procedural, enforceable
at law by a party against the United States, its agencies, its officers, or any person.
WILLIAM J. CLINTON.

Page 275

§ 3717. Interest and penalty on claims
(a)(1) The head of an executive, judicial, or
legislative agency shall charge a minimum annual rate of interest on an outstanding debt on
a United States Government claim owed by a
person that is equal to the average investment
rate for the Treasury tax and loan accounts for
the 12-month period ending on September 30 of
each year, rounded to the nearest whole percentage point. The Secretary of the Treasury shall
publish the rate before November 1 of that year.
The rate is effective on the first day of the next
calendar quarter.
(2) The Secretary may change the rate of interest for a calendar quarter if the average investment rate for the 12-month period ending at
the close of the prior calendar quarter, rounded
to the nearest whole percentage point, is more
or less than the existing published rate by 2 percentage points.
(b) Interest under subsection (a) of this section
accrues from the date—
(1) on which notice is mailed after October
25, 1982, if notice was first mailed before October 25, 1982; or
(2) notice of the amount due is first mailed
to the debtor at the most current address of
the debtor available to the head of the executive or 1 legislative agency, if notice is first
mailed after October 24, 1982.
(c) The rate of interest charged under subsection (a) of this section—
(1) is the rate in effect on the date from
which interest begins to accrue under subsection (b) of this section; and
(2) remains fixed at that rate for the duration of the indebtedness.
(d) Interest under subsection (a) of this section
may not be charged if the amount due on the
claim is paid within 30 days after the date from
which interest accrues under subsection (b) of
this section. The head of an executive, judicial,
or legislative agency may extend the 30-day period.
(e) The head of an executive, judicial, or legislative agency shall assess on a claim owed by a
person—
(1) a charge to cover the cost of processing
and handling a delinquent claim; and
(2) a penalty charge of not more than 6 percent a year for failure to pay a part of a debt
more than 90 days past due.
(f) Interest under subsection (a) of this section
does not accrue on a charge assessed under subsection (e) of this section.
(g) This section does not apply—
(1) if a statute, regulation required by statute, loan agreement, or contract prohibits
charging interest or assessing charges or explicitly fixes the interest or charges; and
(2) to a claim under a contract executed before October 25, 1982, that is in effect on October 25, 1982.
(h) In conformity with standards prescribed
jointly by the Attorney General, the Secretary
of the Treasury, and the Comptroller General,
the head of an executive, judicial, or legislative
1 So

§ 3717

TITLE 31—MONEY AND FINANCE

in original. Probably should be ‘‘, judicial, or’’.

agency may prescribe regulations identifying
circumstances appropriate to waiving collection
of interest and charges under subsections (a) and
(e) of this section. A waiver under the regulations is deemed to be compliance with this section.
(i)(1) The head of an executive, judicial, or legislative agency may increase an administrative
claim by the cost of living adjustment in lieu of
charging interest and penalties under this section. Adjustments under this subsection will be
computed annually.
(2) For the purpose of this subsection—
(A) the term ‘‘cost of living adjustment’’
means the percentage by which the Consumer
Price Index for the month of June of the calendar year preceding the adjustment exceeds
the Consumer Price Index for the month of
June of the calendar year in which the claim
was determined or last adjusted; and
(B) the term ‘‘administrative claim’’ includes all debt that is not based on an extension of Government credit through direct
loans, loan guarantees, or insurance, including
fines, penalties, and overpayments.
(Added Pub L. 97–452, § 1(16)(A), Jan. 12, 1983, 96
Stat. 2472; amended Pub. L. 104–134, title III,
§ 31001(c)(1), (g)(1)(C), (q), Apr. 26, 1996, 110 Stat.
1321–359, 1321–363, 1321–372.)
HISTORICAL AND REVISION NOTES
Revised
Section

Source (U.S. Code)

Source (Statutes at Large)

3717(a) .....

31 App.:952(e)(1)
(1st–3d sentences).

July 19, 1966, Pub. L. 89–508, 80
Stat. 308, § 3(e)(1) (1st–3d
sentences), (2)–(7); added
Oct. 25, 1982, Pub. L. 97–365,
§ 11, 96 Stat. 1755.

3717(b),
(c).
3717(d) .....
3717(e) .....
3717(f) .....
3717(g)(1)

31 App.:952(e)(5).

3717(g)(2)
3717(h) ....

31 App.:952(e)(6).
31 App.:952(e)(2).
31 App.:952(e)(7).
31 App.:952(e)(3) (1st
sentence).
31 App.:952(e)(4).
31 App.:952(e)(3) (2d,
last sentences).

In subsection (a), the words ‘‘percentage point’’ and
‘‘percentage points’’ are substituted for ‘‘per centum’’
for clarity.
In subsections (a)(1) and (e), the words ‘‘Except as
provided in paragraph (3)’’ are omitted as surplus.
In subsection (a)(2), the words ‘‘for a calendar quarter’’ are substituted for ‘‘quarterly’’, and the words
‘‘prior calendar quarter’’ are substituted for ‘‘that calendar quarter’’, for clarity.
In subsection (b), before clause (1), the words ‘‘Subject to paragraph (6)’’ and ‘‘except as provided in subparagraph (B)’’ are omitted as surplus. In clause (2), the
words ‘‘on the claim’’ are omitted as surplus. The
words ‘‘if notice is first mailed after October 24, 1982’’
are added for clarity.
In subsection (c), the words ‘‘on a claim’’ are omitted
as surplus.
In subsection (g)(1), the words ‘‘applicable’’ and ‘‘either’’ are omitted as surplus. The word ‘‘assessing’’ is
added for clarity. The words ‘‘that apply to claims involved’’ are omitted as surplus.
In subsection (h), the words ‘‘under this section’’ are
added for clarity.
AMENDMENTS
1996—Subsec. (a)(1). Pub. L. 104–134, § 31001(c)(1), which
directed that this section be amended by substituting
‘‘the head of an executive, judicial, or legislative agency’’ for ‘‘the head of an executive or legislative agency’’