On May 15, 2003, this case was reassigned to me for disposition. On June 5, 2003, I issued a Notice of Reassignment and Order in which I directed Petitioner to notify me in writing within thirty days from the date of the Order whether he wished to have an oral hearing in this case and whether he had any additional evidence to submit with respect to the issues presented. Petitioner was further directed to inform me, if an oral hearing was requested, why the issues presented could not be resolved by a review of the documentary evidence. Petitioner was informed that failure to respond to the Order within the prescribed period would result in a waiver of his right to an oral hearing and a decision being issued on the evidence of record previously submitted by the parties. No response to the Order was received from Petitioner, and this matter is therefore ready for decision.
Evidence Submitted As noted above, Petitioner submitted a Statement of Issues in Dispute on October 20, 2002 in response to Judge Burke's September 19, 2002 Notice of Docketing (Petitioner's Exhibit 1, hereinafter "PX-1"). Petitioner's statement, and the attachments thereto, reflect that Petitioner was injured May 19, 2002 in a fall in a parking lot near the Bureau of Engraving and Printing where he worked. His statement further reflects that Petitioner continued to work until March 26, 2001, that he sought and received FECA compensation benefits as a result of his injuries, and that he was notified in a March 7, 2002 letter from OWCP that he had been overpaid benefits in the amount of $5,435.38 because of an error in calculating his correct rate of pay. According to Petitioner's statement, he was unaware that he was being overpaid and he never attempted to defraud OWCP. He further asserts that he would suffer a severe financial hardship if required to repay the debt caused by OWCP's error in calculating his correct rate of pay.
On February 19, 2003, OWCP submitted the following Respondent's Exhibits (hereinafter noted as "RX-__"):
RX-1: A May 31, 2000 "Federal Employee's Notice of Traumatic Injury and Claim for Continuation of Pay/Compensation" form signed by Petitioner and reflecting a May 19, 2000 injury to the left knee.
RX-2: A September 14, 2000 letter from OWCP to Petitioner reflecting entitlement to compensation at a weekly rate of $1,473.27 with the first payment to be made for the period July 4, 2000 to September 9, 2000.
RX-3: A March 7, 2002 letter from OWCP notifying Petitioner in part that: a $5,435.38 overpayment of benefits had been made to Petitioner due to an OWCP error; Petitioner was without fault in creating the overpayment; and he had a right to submit new evidence if he disagreed with the fact or amount of the overpayment or wished to seek a waiver of the overpayment. Attached to the March 7 letter is a "Memorandum to File" stating that Petitioner's pay rate was incorrectly calculated due to the addition of a 15% night differential to his base salary which had already been included in Petitioner's base salary.
RX-4: A May 14, 2002 letter from OWCP informing Petitioner of its decision not to waive overpayment, attached to which was a May 14, 2002 "Memo to File" outlining Petitioner's response to the March 7, 2002 notification of the overpayment and OWCP's basis for denial of waiver.
RX-5: A May 28, 2002 letter from OWCP acknowledging receipt of additional information submitted by Petitioner in support of his request for waiver, attached to which was an "Addendum to Memo to File Dated 5/14/02" outlining additional information received from Petitioner and OWCP's continued finding that waiver of the debt was not justified.
RX-6: A June 30, 2002 "Second Notice" from OWCP informing Petitioner that: it had not received payment or any indication from Petitioner that he intended to cooperate with respect to repayment of the debt, now totaling $5,458.02; failure to make payment within thirty days could result in additional charges being added to the debt; and the matter could also be referred to the Department of Treasury for collection of the debt by administrative offset. Attached to the June 30 notice is a July 3, 2002 letter from OWCP in which Petitioner was again informed that failure to contact OWCP or make repayment of the debt within thirty days could result in the actions described in the June 30 notice being initiated.
RX-7: A July 31, 2002 "Third Notice" from OWCP informing Petitioner that: his debt, now totaling $5,480.66, was delinquent; interest at the rate of 5% was being assessed on the unpaid debt and administrative and penalty charges could also be added; OWCP could refer the matter to a credit bureau and to the Department of the Treasury for administrative offset.
RX-8: An August 8, 2002 letter from OWCP to the U.S. Department of Treasury notifying it of Petitioner's unresolved debt in the amount of $5,480.66 and seeking verification of Petitioner's employment and information pertaining to the amount of his disposable pay. Attached to the August 8 letter is an "Employment and Pay Certification" form reflecting handwritten entries confirming Petitioner's current employment status, as well as the frequency and amount of his salary and deductions.
RX-9: An August 13, 2002 letter from OWCP informing Petitioner that it had determined, based on consideration of his financial circumstances, that $250.00 was a fair and reasonable amount to be deducted from his pay every two weeks to satisfy his indebtedness, and that Petitioner could dispute its determination by filing a written request for a hearing by an Administrative Law Judge within fifteen days of receipt of the letter.
RX-10: A December 13, 2002 letter from OWCP requesting that the U.S. Department of Treasury suspend all collection action pursuant to FECA procedures and the order of an Administrative Law Judge.
Discussion, Findings of Fact, and Conclusions of Law The DCA provides debtors with a right to a hearing prior to execution of salary offset concerning the existence or amount of the debt or the repayment schedule proposed by the agency. However, neither the DCA nor its implementing regulations vest an administrative law judge with the jurisdiction to substantively review the underlying debt where, as here, the debt is the result of overpayments made pursuant to FECA. Instead, review is governed solely by the provisions of FECA which state, in relevant
part, that "[t]he action of the Secretary or his designee in allowing or denying a payment under this subchapter is – (1) final and conclusive for all purposes and with respect to all questions of law and fact; and (2) not subject to review by another official of the United States or by mandamus or otherwise. 5 U.S.C. § 8128(b). Therefore, the issues properly before me are: (1) whether the debtor's agency has actually established both a debt and its correct amount upon which an offset is based; and (2) whether the terms of the proposed repayment schedule are feasible, allowable and appropriate. See, e.g., Milligan v. Director, OWCP , 1999-DCA-3 (ALJ Daniel F. Sutton), slip op. at 4-5.
A. Establishment of Debt and Correct Amount.
The evidence shows that, on May 19, 2000, while employed by the U.S. Department of Treasury, Bureau of Printing and Engraving, Petitioner injured his left knee and subsequently sought benefits pursuant to FECA (RX-1). He was thereafter paid benefits for the period July 4, 2000 until March 24, 2001 based on a weekly salary of $1,473.27 (RX-2, RX-3). Petitioner's correct weekly salary during that period of time was actually $1,281.10 (RX-3). As a result of OWCP's error in computing Petitioner's correct rate of pay, Petitioner received an overpayment of benefits in the amount of $5,435.38. As of the time Petitioner sought a formal hearing in this matter, the amount of the debt, including interest, was $5.480.66 (RX-8). Although Petitioner has consistently asserted that repayment of the debt created as a result of this overpayment would constitute a financial hardship, he has never contested the existence or amount of the debt (PX-1). Based on the record before me, I find Respondent has established that Petitioner is indebted to OWCP in the amount of $5,480.66.
B. Terms of Proposed Repayment are Feasible, Allowable, and Appropriate.
Pursuant to applicable regulations, up to fifteen percent of an employee's "disposable pay" may be deducted from his or her pay for repayment of a delinquent debt. 29 C.F.R. § 20.84(a). Disposable pay is defined as an employee's basic and special pay, less the exclusions set forth in 5 C.F.R. § 581.105 for social security withholdings, health and basic life insurance payments, federal, state, and local taxes, and mandatory retirement deductions. 29 C.F.R. § 20.76(a).
According to a May 14, 2002 "Memo to File" prepared by Senior Claims Examiner Debra Ross, Petitioner returned a completed Form OWCP-20 on which he provided certain financial information regarding his monthly income, monthly expenses, and total assets (RX-4). According to the memorandum, Petitioner's net monthly income was$3,700.00, his total monthly expenses were$3,756.01, and his total assets were $22,050.00. Ibid . Although the form provided no information relating to any other sources of income, Ms. Ross assumed that Petitioner's wife was employed and earning income since the financial information supplied by Petitioner reflected no deductions for health or life insurance. She therefore determined that recovery of the $5,435.38 debt would not create an extreme hardship for Petitioner, or defeat the purpose of the Act by depriving him of the income and resources needed to meet his ordinary and necessary living expenses.
According to a May 28, 2002 addendum to Ms. Ross' May 14, 2002 memorandum, Petitioner subsequently provided additional financial information showing that his wife's monthly income was $1,440.64 (RX-5). Petitioner also stated that his net monthly income was $2,666.24 versus $3,700.00. Ibid . Based on this supplemental information, Ms. Ross concluded that Petitioner's total net monthly income of $4,106.88 exceeded his total monthly expenses totaling $3,172.00 and that no change in the prior decision regarding recovery of the debt was warranted.
In response to an August 8, 2002 letter from Ms. Ross, the Department of Treasury, Bureau of Engraving and Printing, verified that Petitioner's gross pay was $2,415.20 every two weeks (RX-8). The information provided by Treasury also showed deductions from Petitioner's pay for taxes, insurance and retirement of $672.99 per pay period resulting in a total net pay to Petitioner of $1,742.21 every two weeks. Id . Petitioner's total net monthly income is thus approximately $2,944.42. When supplemented by his wife's net monthly income of $1,440.64, Petitioner's disposable pay is approximately $4,385.06. Applicable regulations allow recovery of a debt by salary offset of up to 15% of disposable pay which, in this case, amounts to $657.76 per month or $328.88 per pay period. Repayment of Petitioner's debt through salary offset in an amount of $250.00 every two weeks is therefore found to be feasible, allowable, and appropriate.
ORDER Petitioner, Jeffrey H. Moser, shall pay to the United States Department of Labor the amount of $5,480.66 plus accrued interest at the rate of 5% on the unpaid balance. This amount shall be payable as a deduction from Petitioner's pay in the amount of $250.00 per pay period until the debt is satisfied. Salary offset deductions may commence as of the first full pay period following the date of this decision. 29 C.F.R. § 20.84(a).
STEPHEN L. PURCELL
Washington, D.C.
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