USDA Farm Service Agency Payments
DEAR COLLEAGUE LETTER
DATE: August 14, 2009
TO: STATE AND TRIBAL IV-D DIRECTORS
RE: USDA Farm Service Agency Payments
On July 24, 2009 the Federal Office of Child Support Enforcement (OCSE) received notification from the United States Department of Agriculture (USDA) that beginning on or around September 1, 2009 all Farm Service Agency (FSA) Commodity Credit Corporation (CCC) payments will be processed through Treasury’s Financial Management Service (FMS) and therefore eligible for Federal administrative offset.
As you may already know, all payments eligible for offset under the Debt Collection Improvement Act (DCIA), other than Federal tax refunds, are categorized as administrative payments. Under the administrative offset program, Federal payments are identified as either vendor/miscellaneous (e.g., non-retirement payments such as expense reimbursements) or Federal retirement payments. Since the FSA/CCC payments are considered to be administrative vendor payments, up to 100 percent of each payment can be intercepted. OCSE will code FSA/CCC offsets as vendor/miscellaneous (or VEN) on your State’s Federal offset collection and adjustment file. FMS will administer the same $17.00 fee per FSA/CCC offset as it does for other administrative offsets.
Unlike tax refund offset, administrative offset is optional for States. States are required to remove existing administrative offset and/or vendor offset exclusion indicators from debts in order to make them eligible for FSA/CCC payment intercept. Because USDA sends out millions of FSA/CCC payments to individuals annually, we project that the intercept of these payments will have a positive impact on administrative offset collections. USDA also issues a significant number of FSA/CCC payments to corporations or companies which are identified with a Federal Employee Identification Number (FEIN). Only those FSA/CCC payments made to individual Social Security numbers will be eligible for offset. Those identified with a FEIN will not.
USDA issues a large number of its FSA/CCC payments from mid-September through October. If a State currently does not participate in the Federal administrative offset program but is considering doing so, debts should be submitted prior to mid-September for administrative offset eligibility. The nationwide USDA notice informing USDA’s state and county offices of the change to their process may be found at http://www.fsa.usda.gov/Internet/FSA_Notice/fi_2904.pdf (19.90KB Adobe PDF).
Information about FSA/CCC may be found at
OCSE will continue to provide outreach on this process through Federal offset State conference calls as well as e-Flashes or Dear Colleague Letters if needed.
If you need more information regarding the intercept of these FSA/CCC payments or have concerns regarding the administrative offset process, please contact Rebecca Hamil at (202) 205-5612 or email email@example.com .
Office of Child Support Enforcement
cc: ACF/OCSE Regional Program Managers