Regulations & Guidance

31 CFR Part 256: Final Rule
Federal Register, October 17, 2006

31 CFR Part 256, the Judgment Fund Regulation, governs how Federal government agencies obtain payments from the Judgment Fund and how individuals obtain payments under private relief acts

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Treasury Financial Manual (I TFM 6-3100)

The Treasury Financial Manual (TFM) is Treasury's official publication providing policies, procedures and instructions to federal agencies concerning collections, payments and governmentwide accounting and reporting of all receipts and payments of the federal government.

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No FEAR Act Reimbursement Responsibilities

The No FEAR Act, 5 U.S.C. § 2301 Note, requires agencies to reimburse the Judgment Fund for payments made on their behalf to employees, former employees, or applicants for Federal employment arising out of claims of actual or alleged violations of Federal antidiscrimination laws, Federal whistleblower protection laws, and/or retaliation claims arising from the assertion of rights under those laws.

FMS makes a demand for reimbursement in writing to the debtor agency 15 business days after the No FEAR payment has been made.

Upon receipt of a reimbursement demand, an agency has 45 business days from the date of the demand letter to reimburse the Judgment Fund or contact the Judgment Fund Branch to make written arrangements for reimbursement. An agency is considered noncompliant with the reimbursement provisions of the No FEAR Act if it fails to reimburse or make timely arrangements for reimbursement, as required by the Office of Personnel Management (OPM) regulations at 5 CFR § 724.104.

Non-Compliant Agency Report

No Fear Non-Compliant Agency Report

As required by OPM regulations at 5 CFR § 724.105, FMS posts on its website an annual report listing those agencies that have failed to reimburse the Judgment Fund or to contact FMS within 45 days after receipt of a reimbursement demand related to No FEAR Act payments made on their behalf.

Contract Disputes Act Reimbursement Responsibilities

The payment of Contract Disputes Act (CDA) claims is governed by 41 U.S.C. § 7101 et.seq. Subsection (c) provides that CDA claims paid by the Judgment Fund shall be reimbursed by the agency whose appropriations were used for the contract in dispute.

FMS makes a demand for reimbursement in writing to the debtor agency 15 business days after the CDA payment has been made.

Upon receipt of a reimbursement demand, an agency has 15 business days from the date of the demand letter to reimburse the Judgment Fund or contact the Judgment Fund Branch to make written arrangements for reimbursement. An agency is considered noncompliant with the reimbursement provisions of the CDA if it fails to reimburse or make timely arrangements for reimbursement within that time period. An agency that fails to respond to a CDA reimbursement demand will be identified as noncompliant in any reports on CDA reimbursements requested or required by Congress.

Adjudicator Guidance: Offset of Payments

The Debt Collection Improvement Act of 1996 amended 31 U.S.C. § 3325 to require agencies to include Taxpayer Identification Numbers (TINs) on certified payment vouchers. The primary purpose of this requirement is to facilitate the offset of payments to collect delinquent debt owed by the payee through the Treasury Offset Program (TOP) in accordance with 31 U.S.C. § 3716 (c). The Judgment Fund Branch therefore requires a TIN for each payment it makes (see FMS Form 197, item 6). The TIN, along with the name of the person having beneficial interest, is used to match against debtors in the TOP. Since the TIN is collected in order to offset payments, the submitting agency must ensure that the TIN that is provided to FMS is for the person having beneficial interest in the payment. The following examples provide guidance for the most common payment scenarios::

1. Individual Claimants. In most cases, the payee and the person having beneficial interest in the payment will be the same person. For example:
   
       Claimant / Plaintiff: John Smith
       Payee: John Smith
       TIN: John Smith's Social Security Number
   
   
2. Representative Payees. In the case of representative payees, such as a guardian or attorney, the TIN provided on the form must be for the beneficial interest holder, not the payee
   
       Claimant / Plaintiff: John Smith
       Payee: Bob Jones (attorney for John Smith)
       TIN: John Smith's Social Security Number
   
   
3. Joint Payees. . When a payment is made to joint payees, both payees have a beneficial interest in the payment and both TINs must be provided. Such a payment is subject to offset for the debts of either payee. For example:
   
       Claimant / Plaintiff: John and Mary Smith
       Payee: John and Mary Smith
       TIN: John Smith's Social Security Number and Mary Smith's Social
        Security Number