1142.055.00 COLLECTION PROCEDURES

IM-#61 August 21, 2009, IM-#142 December 2, 2005

When a claim is entered into CARS, the process to collect the overpaid amount begins. The EU receives a demand letter telling them the Food Stamp claim balance, repayment procedures, hearing rights, and compromise option for some claims. After the demand letter is generated, the EU does not receive another notice regarding the Food Stamp claim balance or hearing rights on this specific claim.

If a debtor does not return the original repayment agreement and wishes to enter an agreement to repay the Food Stamp debt, give the debtor the CARS-7 Food Stamp Repayment Agreement.

Collections are made against only one EU with at least one responsible debtor for a single claim when responsible claim members reside in multiple Food Stamp EUs.

1142.055.05 Compromising Claims

IM-#82 August 28, 2007,  IM-#142 December 2, 2005

Consider all AE and IHE claims for compromise when contacted by the EU. “Compromise” is reduction of a claim balance. The claim balance can be reduced to zero. The demand letter advises the EU to contact the county FSD office if circumstances exist that impact the EU's ability to repay the claim amount. If the EU contacts FSD and indicates they will have difficulty paying the claim, consider compromising the claim. Claims are compromised as follows:

IPV/SPV claims are not compromised.

1142.055.10 Repayment Agreement

IM-#61 August 21, 2009, IM-#142 December 2, 2005

A repayment agreement is sent to the EU with the demand letter. The debtor is given two options. One allows the EU to repay with check, money order, or with Food Stamp benefits. The other agreement allows the EU's Food Stamp benefits to be reduced each month before they are available by benefit reduction. The debtor(s) signs one of the agreements according to the best repayment method for the EU. If the EU chooses to not agree to make repayment and the EU has an active Food Stamp case, benefit reduction is applied. If the repayment agreement is returned with benefit reduction section completed, take no action as the system automatically initiates the benefit reduction. Benefit reduction is also known as recoupment.

If the debtor does not have the original repayment agreement and wishes to enter into a repayment agreement, give the debtor the CARS-7 FOOD STAMP REPAYMENT AGREEMENT. The debtor is given three options. One allows the EU to repay the entire amount with check, money order, or with Food Stamp benefits. The second allows the EU to repay a portion of the debt now using check, money order, or Food Stamp benefits, and the remainder to be paid in monthly payments. The third option allows the EU to set up monthly payments using check or money order. The debtor(s) chooses one of the agreements options according to the best repayment method for the EU.

If the CARS-3 REPAYMENT AGREEMENT or the CARS-7 FOOD STAMP REPAYMENT AGREEMENT is returned with a method of repayment other than recoupment to:

For instructions see CARS User Guide ENTERING REPAYMENT AGREEMENTS AND PROCESSING PAYMENTS IN THE CLAIMS ACCOUNTING AND RESTITUTION SYSTEM (CARS).

The Repayment Agreement is filed in the CLAIMS SECTION of the case record.

If the EU fails to make a repayment in accordance with the repayment agreement, CARS generates a billing statement. If any responsible member of the EU is receiving food stamp benefits, the system may begin automated recoupment of food stamp benefits.

An individual may request renegotiation of a repayment agreement. If the agency agrees with the request, a new payment is negotiated. The individual signs a new agreement and OVCC is updated. If the agency finds the EU's economic circumstances have not changed enough for the repayment agreement to be changed, the original repayment amount remains. The request for renegotiation and the reason for the decision is recorded on the Note Add (OVNA) screen.

If the EU is receiving Food Stamp benefits, the repayment agreement cannot be less than the amount that can be recovered with recoupment. The repayment agreement is not renegotiated when the Food Stamp benefit amount changes. Recoupment is the greatest of the repayment agreement amount, the minimum recoupment allowed, or a percentage of the allotment.

1142.055.15 Methods of Repayment

IM-#142 December 2, 2005

A claim can be repaid by:

For instructions see CARS User Guide ENTERING REPAYMENT AGREEMENTS AND PROCESSING PAYMENTS IN THE CLAIMS ACCOUNTING AND RESTITUTION SYSTEM (CARS).

1142.055.15.05 Cash

IM-#142 December 2, 2005

If a claim is to be repaid in cash, the EU is instructed to make the payment in the form of bank draft, cashier's check, or money order whenever possible. Cash payment is accepted. A receipt is given to the EU and a copy filed in the claims section of the record. If a cash payment is made to the local office, a money order or cashier's check may be purchased at the local office expense. Checks received are endorsed “FOR DEPOSIT ONLY TO THE CREDIT OF THE TREASURER OF THE STATE OF MISSOURI - DEPT OF SOCIAL SERVICES” and all payments are submitted daily.

Payments received in the local office are forwarded to Division of Budget and Finance with a completed CARS-2, using transaction code 01.

For instructions see CARS User Guide ENTERING REPAYMENT AGREEMENTS AND PROCESSING PAYMENTS IN THE CLAIMS ACCOUNTING AND RESTITUTION SYSTEM (CARS).

1142.055.15.10 EBT Voluntary Repayment

IM-#142 December 2, 2005

A debtor may voluntarily use food stamp benefits in their EBT account to repay a food stamp overpayment. A Voluntary Repayment Authorization form (IM-114), is completed and signed by the debtor. Verify a claim has been established for the overpayment on the Display Claim Information screen (OVCI). To view the claim type OVCI, space, I, DCN and press enter. To view additional claims for this individual, press enter. When all claims have been displayed, the message “END OF INQUIRY” displays. The Claim Summary Screen (OVSC) displays a summary of claims for the individual, including the repayment agreement.

The voluntary repayment action is entered into the EBT Administrative Terminal. For instructions see CARS User Guide Entering a Voluntary Repayment in EBT. The payment will be automatically posted to the claim. A CARS-2 is not submitted for posting.

If the claim is entered the same day the authorization is entered, a report is generated to the Claims and Restitution Unit to manually post the payment.

If the food stamp benefits are aged, reissue the benefits following current procedures prior to entering the repayment action in the Administrative Terminal. Refer to theFAMIS User Guide Reissuing Aged Benefits for instructions on reissuing benefits prior to voluntary repayment.

For instructions see CARS User Guide ENTERING REPAYMENT AGREEMENTS AND PROCESSING PAYMENTS IN THE CLAIMS ACCOUNTING AND RESTITUTION SYSTEM (CARS).

1142.055.15.15 Offset

IM-#142 December 2, 2005

When an EU is eligible for restored food stamp benefits and there is a claim balance, the restored benefits are applied to the outstanding claim balance. Restored benefits are paid if, through no fault of the EU, there is an under-issuance. Complete a budget to determine the amount of the restored benefits on the Worker Initiated Budget Calculation Area (WIBCA) screen. If there is a claim balance, the restored benefits are applied first to the claim, and the remainder issued to the EU. Enter the amount of the claim balance, up to the amount of the restored benefits in the Offset field on WIBCA. Apply restored benefits each month to outstanding food stamp claims, until the claims are paid in full. For instructions refer to FAMIS user guide WIBCA.

Complete a CARS-2 for the total amount of the offset using a credit transaction code 07, and send to the Division of Budget and Finance (DBF).

For instructions see CARS User Guide ENTERING REPAYMENT AGREEMENTS AND PROCESSING PAYMENTS IN THE CLAIMS ACCOUNTING AND RESTITUTION SYSTEM (CARS).

1142.055.15.20 Automated Recoupment of Food Stamp Benefits

IM-#142 December 2, 2005

CARS automatically initiates recoupment for any claim that is eligible to be paid for an active food stamp EU through reduction of food stamp benefits. CARS knows when to begin recoupment on food stamp claims. Information entered in the repayment agreement fields assists the system in deciding the amount to recoup and when to start. Claims are eligible for recoupment if

There will be no recoupment of food stamp benefits if

The system also knows how much to collect on claims.

If a responsible member of a claim is receiving food stamps in any EU, that allotment may be reduced to pay for the overpayment.

1142.055.15.25 Treasury Offset Program

IM-#142 December 2, 2005

The Treasury Offset Program (TOP) is a mandatory Federal government delinquent debt matching and payment offset system. It is a cost-effective means by which a Federal agency may recover delinquent debts. The Treasury Offset Program

Federal payments include, but are not limited to, SSA, Federal salary, Federal travel reimbursement, IRS Federal tax refund, IRS Earned Income Credit (EIC), and the Child Tax Credit.

Debts must meet the following criteria to be eligible for referral to TOP:

Prior to referring the debt to TOP, the Claims and Restitution Unit sends a notice to the EU (60-day notice) of the intent to refer the debt to TOP unless the debt is paid or other arrangements are made. FNS obtains addresses for the state to use for sending out 60-day notices. The notice informs the debtor that s/he may avoid TOP collection if s/he repays the debt in full, agrees to a repayment plan and makes agreed payments, requests a review if s/he believes the debt is not owed, or files bankruptcy and the automatic stay is in effect.

Debtors are entitled to a review of the intended TOP collection action. A debtor must submit a written request for review by the date prescribed in the 60-day notice. This is not a request for a fair hearing on the claim, but only a review of the TOP referral process. Requests for a review of TOP collection action received by county FSD staff are referred to the Claims and Restitution Unit at (573) 751-3004.

The debtor may contact the Claims and Restitution unit in response to a 60-day notice and have questions regarding the establishment of the claim. Questions regarding establishment or other collection actions, including compromise, received by Claims and Restitution Unit are referred to the county FSD office.

If possible, the agency shall collect the total amount of the debt in one lump sum. If the debtor is financially unable to pay in one lump sum, the agency may accept payments in regular installments. The size and frequency of the installment payments should bear a reasonable relation to the size of the debt and debtor's ability to pay. If possible, the installment payments should be sufficient in size and frequency to pay the debt in full in three years or less. The payment agreement includes:

FNS furnishes a collection file of offsets and reversals made by TOP. The funds are accepted, verified, and posted to the debts.

1142.055.15.30 Expunged Food Stamp Benefits

IM-#142 December 2, 2005

Expunged food stamp benefits are automatically used to reduce food stamp claim balances. The expunged benefit file is run against the CARS database monthly. Benefits that are expunged each month are applied to the claim balances the next month. Expunged food stamp benefits that exceed the balance of the claim only have the amount of the balance reduced. Negative balances and refunds due to expunged benefits are not given. After this process runs each month, food stamp claim reductions are posted on the OVPT screen. Transaction code 14 is used to identify these claim balance reductions.

If benefits have been expunged prior to establishment of the claim, contact the Food Stamp Program and Policy Unit regarding thepossibility of applying the expunged benefits to the claim balance.