FACT 47 (Clarification: Treasury Offset Program Outstanding Debts)
Food Assistance Change Transmittal No. 47
April 25, 2012
TO: Food Assistance Certification Handbook Holders
FROM: Michael B. Colbert, Director
SUBJECT: Clarification: Treasury Offset Program Outstanding Debts

This Food Assistance Change Transmittal (FACT) replaces FACT 46. FACT 46 is now obsolete.

Background: The Treasury Offset Program allows delinquent food assistance claims to be referred to the United States Treasury. The United States Treasury then offsets eligible federal payments (e.g. tax refunds) in order to repay the delinquent food assistance claim. Previous rules provided a ten year limitation on debts referred to the Treasury Offset Program. The 2008 Farm Bill included a provision that eliminated the ten year limitation on referral of outstanding federal debts to the Treasury Offset Program.

On April 15, 2010 rule 5101:4-8-30, "Food Assistance: Treasury Offset Program," was amended to remove the ten year limitation on referring outstanding debts to the Treasury Offset Program. As a result of the changes to the 2008 Farm Bill, the United States Department of Agriculture Food and Nutrition Service (FNS) issued guidance requiring states to remove the ten year limitation language from notices and to begin using the updated notices by January 1, 2010.

Claims established prior to January 1, 2000 cannot be referred to the Treasury Offset Program because under the previous policy claims more than ten years old could not be collected through the Treasury Offset Program. They were to have been terminated and written off, and therefore they were not outstanding debts. Rule 5101:4-8-19 of the Ohio Administrative Code states that for claims that are delinquent for more than three years the county agency must terminate and write off the claims unless they are to be collected under the Treasury Offset Program. However, claims established after January 1, 2000 would fall under the removal of the ten year limitation provision and can always be considered outstanding debts; thus they may be referred to the Treasury Offset Program.

Clarification: There is one exception to this policy. Claims established prior to January 1, 2000 which reflect final court judgments or which were due to an individual's intentional violation of program requirements will be subject to collection through the Treasury Offset Program. 7 CFR 273.18 permits states to reopen a claim if a new collection method becomes available and it will increase the likelihood of further collections.