336.2 - Billing Non-Federal Customers and Former and Current Employees

7/2/92

OPR: Admin/Financial Management

1. Purpose and Scope. The purpose of this chapter is to provide policies and procedures to be used for billing non-Federal customers for goods or services furnished by the U.S. Geological Survey (USGS) and for billing both former and current employees who have outstanding debts with the Federal Government.

2. Authority. DM 338.1.4A and DM 344, Public Law 97-365 dated October 25, 1982, Federal Claims Collection Standards (4 CFR 101-105), and I TFM 6-8000.

3. Policy. The debt management program for the USGS will be comprehensive in scope and will provide for timely notification to debtors in order to collect all debts due the United States for money or property. Work for non-Federal agencies will be financed by advance funding. The Office of Management and Budget Circular A-34 states that reimbursable work for public customers requires an advance payment. Two exceptions are the State Cooperative Program and the Map Sales and Receipts program.

4. Definitions. "Customer" refers to state and local governments (such as county, city), universities, Federal Energy Regulatory Commission (FERC) permittees, the United Nations, foreign governments, former and current employees, and other public customers not specified here.

"Debtor" refers to all customers and former and current employees owing money to the Government.

"Advance Funding" refers to payment that is received before the work is performed.

"Reimbursable Funding" refers to payment that is received after the work is performed.

"Expenditure Refund" refers to the credit to an account number and object class of a previous outlaid expenditure; e.g., overpayment of salary cost, refund of a credit memorandum.

5. Responsibilities.

A. The Office of Financial Management (OFM) is responsible for assuring that all USGS offices comply with requirements of this chapter, and for establishing and maintaining these billings as accounts receivable which are reimbursable to USGS appropriations. OFM is also responsible for notifying former and current employees of outstanding payroll debts and outstanding travel advance balances (SM 336.2.7, 8) and mailing demand letters to debtors (SM 336.2.12).

B. The National Mapping Division (NMD) is responsible for issuing billings to customers for the sale of maps and products on account. NMD is also responsible for establishing and maintaining accounts receivable for these billings and reporting the status of accounts receivable activity as required by OFM.

C. The Heads of USGS Billing Offices are responsible for the accurate and timely preparation of billings for goods and services furnished to non-Federal customers and to assure that all billings are in accordance with payment provisions of agreements, if applicable. Offices are also responsible for reviewing the monthly reports provided by OFM and reporting discrepancies between these reports and Division records to OFM.

D. The Office of Procurement and Contracts is responsible for preparation of billings for disallow ed contract costs as a result of audit, overbillings, or contracting. (Also, see SM 338.4.10.)

E. The Office of Facilities and Management Services, Branch of Property Management is responsible for notifying employees of amounts owed for lost or damaged property (see SM 336.2.8, 9 and 410 DM 114-60) and for promptly processing Form 9-090, Employee Clearance Form, in order to identify and settle outstanding property debts prior to employee separation (See SM 344.16.)

F. The Office of Personnel is responsible for determining if a debt for training costs is owed from an employee. Upon notification that an employee is separating or terminating employment, the Office of Personnel should immediately attempt to recover any outstanding training costs. In the event that the debt is not recovered prior to separation, the Office of Personnel will coordinate with OFM, Debt Management Section in order to notify the former employee of the outstanding debt.

6. Procedures.

A. USGS Sales Offices. Billing forms utilized by sales offices authorized to maintain on-site accounts receivable records must conform with requirements contained in SM 336.2.7 and SM 338.4.3. Approval to use billing forms other than the DI-1040, Bill for Collection, must be obtained from OFM before issuance.

B. Other Billing Offices. Form DI-1040, Bill for Collection, revised August 1973, is designated for use by all bureaus within the Department of the Interior for reimbursement billings to non-Federal customers. Form DI-1040 is available in sets of an original and six copies and is used for all billings for goods and services other than those for the sale of products using forms described in SM 336.2.6A. OFM will inform former employees having outstanding debts by bill or letter. The Office of Personnel will coordinate with the OFM Debt Management Section in order to notify by letter former employees of debts owed for training costs. The Branch of Property Management will coordinate with OFM, Debt Management Section, in order to notify persons by letter who owe reimbursement to the USGS for lost or damaged property. (See SM 336.2.8 and 410 DM 114-60.)

7. General Instructions for Completion of Form DI-1040 are as follows (see Figures 1-4):

A. Bill Number. All DI-1040's issued by the USGS will be assigned a bill number by the office preparing the billing. The first position of the bill number will contain the last digit of the fiscal year in which the bill was prepared. The next four positions will consist of the four digits of the billing activity's organization code. The last four digits will be a sequential reference number assigned from the billing office's log book. The bill number will be written with a hyphen separating each of these categories; e.g., 2-4000-0001.

B. Remittance Address. The address to be included on the DI-1040 will depend on the type of customer being billed.

(1) Joint Funding Agreement Customer billings will include the remittance address as specified for lockbox collections or remittances transferred via TFCS transfer. (See SM 338.1.11, 338.1.12.)

Billings to be paid through lockbox should include the following information (see Figure 1):

Make Remittance Payable To: Department of Interior/USGS

Mail Payment To:

U.S. Geological Survey

Joint Funding Agreement

Box 100706

Atlanta, GA 30384

Billings to be paid via TFCS transfer should have the message "TFCS TRANSFER" on the bills.

(2) All Other non-Federal Customer billings should include the following information:

Make Remittance Payable To:

Department of Interior/USGS

Mail Payment To:

USGS - Office of Financial Management

271 National Center

Reston, VA 20192

C. Payer. Use appropriate address. To assure proper credit, the USGS 5-digit customer number chargeable for the costs incurred must be shown. (See Figure 1-4.)

D. Description. Each DI-1040 should inform the customer of the basis for the indebtedness, including an itemized list of charges.

E. Due Date. For all Joint Funding Agreements (JFA's), the due date is not more than 60 days from the date of the bill. For all other non-Federal customers, the due date is to be not more than 30 days from the date of the bill. (See Figure 5.)

F. Interest Requirement. Interest is to accrue from the date on which notification of the amount due on the claim is first mailed to the customer. Interest will not be charged if the amount due is paid within 30 days from the date of notification on non-Federal customer billings. Interest will not be charged if the amount due is paid within 60 days from the date of the notification on JFA's. The following statement is to be included on all such billings:

"Federal regulations require a(n)* annual percentage rate ($**/month) be assessed for each 30 day period, or portion thereof, from the date of this bill. No interest will be charged if payment is made by the due date."

G. Return Copy. A statement requesting the white copy be returned with remittance is to be included.

H. Certification. The following statement should be included and signed by the Administrative Officer or head of the billing office.

"I certify that this bill is correct and that payment has not been received."

/s/__________________ (Phone Number)

*The current value of funds rate established by Treasury. All billing offices are notified of the latest rate by OFM numbered memorandum.

**The monthly amount to be assessed for each 30-day period. This amount equals

(Amount X Annual Rate).

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I. Accounting Classification. Depending on the type of bill (reimbursable, expenditure refund, or advance billing, the bottom of form DI-1040b (pink copy) must include the following accounting information. For reimbursable and advance billings the appropriation symbol, agreement number, budget organization, and five digit customer number should be shown on the bill. This customer number, agreement number, budget organization, and appropriation symbol must match against a valid agreement number as recorded in the Federal Financial System (FFS) Customer Agreement Header/Line Table (CAHT/CALT). See Appendix C and D. For expenditure refund billings, the accounting information should include the appropriation symbol, nine-digit account number, and budget object classification that was charged on the original expenditure. See Appendix E. Normally, 14-0804, Surveys, Investigations and Research will be the appropriation used for non-Federal reimbursements. The 3rd digit of the symbol indicates the fiscal year to reimburse; e.g., 1420804 would be used for billings reimbursing FY 92 cost. For non-Federal Map Sales reimbursement, the no-year appropriation symbol 14X0804 should be used.

J. Distribution of Copies of Form DI-1040:

(1) DI-1040 (white) Original and DI-1040a (blue) Official Receipt Copy are to be mailed to the customer. The white copy is to be returned with remittance.

(2) DI-1040b (pink) Accounting Copy is to be simultaneously forwarded to the Office of Financial Management at the time the original bill is mailed to the customer.

(3) DI-1040b (green) Administrative or Billing Copies will be distributed in accordance with the individual billing organization's requirements with 1 copy retained in the billing office.

8. Instructions for Issuing a Billing to Former Employees. FFS generated bills or letters will be used to notify former employees and will contain similar information as required for the DI-1040.

Bills/Letters shall include at a minimum:

- A description of the debt and the basis of the debt;

- A reconciliation supporting the debt;

- Remittance information (see SM 336.2.6B(2));

- The due date which will be no more than 30 days from the date of the bill/letter to avoid further action;

- SSN of the employee in the upper right-hand corner of the bill/letter;

- Interest statement (see SM 336.2.6F);

- The name and phone number of the person to be contacted if there are questions pertaining to the debt;

- The right of the debtor to contest the debt;

- Tools the USGS may use to collect its debt including credit reporting bureaus and collection agencies.

These letters will serve as the initial billing notification. They should be sent "Registered" or "Certified" Mail (return receipt requested). A copy of the bill/letter and any attachments must be forwarded to OFM, Branch of Accounting, Debt Management Section, simultaneously with the mailing of the original bill/letter to the debtor. The copy forwarded to OFM must include accounting information, such as the account number and object class to be refunded. This copy will serve as the account receivable copy.

9. Instructions for Issuing a Billing to Current Employees. Bills generated from FFS or letters to notify current employees will include the same information as above. In addition, the letter will include notification that if payment is not received by the due date, payroll deductions to offset the debt will be withheld until the debt is paid. The letter will notify employees of their rights prior to commencement of salary offsets, including:

- The employee is entitled to receive advance written notification of the Bureau's intention to collect the debt by salary offset;

- The deduction will equal 15% of the employee's disposable pay, which is that amount of pay remaining after the deduction of any amount required by law to be withheld;

- Interest at the current Treasury rate will be assessed for the duration of the debt. Administrative costs to handle the debt will be added, and a 6% penalty will be assessed if the debt remains unpaid for 90 days;

- That the employee has a right to inspect and copy records on which the debt is based;

- That the employee has the right to enter into a written repayment schedule agreement as long as the USGS is agreeable to the terms of the agreement;

- The employee's right to a hearing concerning the debt. A hearing may be requested by filing a written petition within 15 calendar days of receipt of the notification, addressed to the Director, OHA, (Address: Director, Office of Hearings and Appeals, U.S. Department of the Interior, 4015 Wilson Boulevard, Arlington, Virginia 22203) stating the grounds upon which the employee disputes the Bureau's proposed collection of the alleged debt. The petition or statement shall identify and explain with reasonable specificity and brevity the facts, evidence, and witnesses which the employee believes support his or her position. A copy of the petition or statement shall be sent to the Chief, Office of Financial Management;

- That the timely filing of a petition for hearing will stay the commencement of collection proceedings;

- That a final decision on the hearing (if one is requested) will be issued at the earliest practical date, but not later than 60 days after the filing of the petition requesting the hearing unless the employee requests and the hearing official grants a delay in the proceedings;

- That any knowingly false or frivolous statements, representations, or evidence may subject employee to:

(1) Disciplinary procedures appropriate under 5 U.S.C. Chapter 75, and 5 CFR Part 752, or any other applicable statutes or regulations;

(2) Penalties under the False Claims Act, 31 U.S.C. 3729 - 3731, or any other applicable authority; or

(3) Criminal penalties under 18 U.S.C. 286, 287, 1001, and 1002, or any other applicable statutory authority.

- Unless there are applicable contractual or statutory provisions to the contrary, that amounts paid on or deducted for the debt which are later waived or found not owed to the United States will be promptly refunded to the employee;

- The name, address, and telephone number of an official who may be contacted if the employee wishes to review the records or to obtain information.

10. Form 9-2046, Notice in Event of Delinquency (Figure 6). This form must be used as an attachment to all billings, including billing letters to former employees (SM 336.2.8), issued by USGS, except billings to State and local governments and universities. When billings are computer generated, statements included on Form 9-2046 may be printed on the bill in lieu of an attachment. (See OFM Memorandum No. 84-13.)

11. Changes in the Status of a Form DI-1040 or Billing Letter. Billing offices will immediately notify OFM in writing of any revisions to the initial billing notification.

12. Frequency of Billing. Unless otherwise provided in an agreement, billings to individuals and organizations outside the Federal Government will be prepared and dispatched within 5 workdays after the day the billing office is advised that the goods have been shipped or released, or the services completed. Computer-generated billing statements for USGS sales activities will be mailed out at least monthly. If the value of the goods or services cannot be specifically determined, a bill equal to at least 75 percent of the estimated value will be prepared and mailed within 5 business days. Identify the estimated invoice as being a partial invoice and note that a final invoice will be completed when the value is determined. WRD users should refer to WRD supplement regarding the preparation of bills.

13. Demand Letters. Demand letters will be generated by OFM and mailed directly to all debtors having delinquent account receivable balances. Sales offices authorized to maintain on-site account receivable records are responsible for issuing demand notices. (See SM 338.4.4B.)

14. Reimbursement by Direct State Expenditures. Some joint funding agreements (SM 500.1) include expenditures made directly by the cooperator for the benefit of the program. The value of these expenditures is included in the total amount authorized for the program, and the vouchers submitted as evidence of direct state expenditures are recorded as obligations of the accounts to which

the funds were authorized. Simultaneously, transactions are processed to record the amount of the direct state expenditures as reimbursements. Direct state expenditure vouchers, Figure 7, should be made available to the cooperator (reimbursable customer) to document the services performed at the beginning of the agreement period or periodically as services have been performed. USGS office should initiate the completion of the form according to the billing intervals specified in the Joint Funding Agreement (quarterly, semi-annually, annually, etc.). Instructions for the completion of this document are contained in Figure 7. The use of this form for the submission of Direct State Services is mandatory in all WRD offices. An example of a completed Form 9-3030 is contained in Figure 8.