Section 285.1100  Foreword

 

This Part is adopted for the purpose of establishing procedures for making offsets of claims eligible to be offset from warrants to be issued to persons entitled to them, in accordance with Section 10.05 of the State Comptroller Act [15 ILCS 405/10.05] and the Illinois State Collection Act of 1986 [30 ILCS 210]. This Part is promulgated pursuant to the authority contained in Section 21 of the State Comptroller Act [15 ILCS 405/21].

 

(Source:  Amended at 19 Ill. Reg. 227, effective December 30, 1994)

 

Section 285.1101  Definitions

 

As used in this Part unless the context indicates otherwise, the following terms shall have the meanings specified:

 

"Account or claim eligible to be offset" means an amount owed to the State or to any of its agencies or instrumentalities or other amount authorized by statute to be collected through offset that represents:

 

an outstanding liability of a person to a fund in the State Treasury or other fund held by the State Treasurer;

 

an outstanding liability of a person to a fund not held by the State Treasurer, when that amount exceeds $10;

 

past due child support owed by a person as a result of support action being taken by the Department of Healthcare and Family Services under Article X of the Illinois Public Aid Code [305 ILCS 5], whether or not that support is owed to the State;

 

delinquent or defaulted amounts due and owing from a borrower, whether or not due and owing to the State, on any loan guaranteed by the Illinois State Scholarship Commission under the Higher Education Student Assistance Act [110 ILCS 947] or on any "eligible loan" as that term is defined under the Education Loan Purchase Program Law [110 ILCS 947/125 to 170];

 

any amounts recoverable under Section 120 of the Higher Education Student Assistance Act [110 ILCS 947], whether or not any amounts so recoverable are due and owing to the State, in a civil action from a person who received a scholarship, grant, monetary award or guaranteed loan;

 

an outstanding liability of a municipality or county to a pension fund in accordance with the Illinois Pension Code [40 ILCS 5].

 

"Act" means the "State Comptroller Act" [15 ILCS 405].

 

"Comptroller" means the Comptroller of the State of Illinois or any employee of the Office of the Comptroller authorized by the Comptroller to perform the functions and duties required by the Act or this Part.

 

"Disposable earnings" means that part of the earnings of an individual remaining after deduction of any amounts required by law to be withheld.

 

"Net amount of the warrant" means the amount of money a State agency has authorized the Comptroller to order the payment of, remaining after all involuntary and voluntary deductions are made and deferred compensation is deducted.

 

"Offset" means a contrary claim or demand by which a given person's claim to a warrant of the State Comptroller may be lessened or cancelled.

 

"Person" means any individual, corporation, company, association, firm, partnership, society, joint stock company, unit of local government or any other organization.

 

"Person subject to the offset" means the payee of any warrant from which the Comptroller has offset an account or claim eligible to be offset.

 

"Received a voucher" means that point in time when the Comptroller has physically received the voucher in-house and has date-stamped the voucher.

 

(Source:  Amended at 43 Ill. Reg. 4534, effective March 26, 2019)

 

Section 285.1102  Request for Processing a Claim Under Section 10.05 of the Act

 

a)         All debts that exceed $250 and are more than one year past due shall be placed in the Comptroller's Offset System unless:

 

1)         the State agency to which the debt is owed has entered into a deferred payment plan or other settlement agreement with the debtor; or

 

2)         the State agency to which the debt is owed demonstrates to the Comptroller's satisfaction that use of the Comptroller's Offset System is not cost effective.  The demonstration shall be based on efficiency to the State and maximizing the portion of the debt that will be recovered by the State.

 

b)         The Comptroller will not process a claim under Section 10.05 of the Act until the Comptroller has received a statement of notification from the State agency that the debt has been established through notice and opportunity to be heard.

 

c)         For purposes of Section 10.05 of the Act and this Part, "statement of notification" of an account or claim eligible to be offset shall be deemed to occur when the State agency in favor of which the account or claim has arisen has submitted to the Comptroller the following information:

 

1)         the name and Social Security Number or Federal Employer's Identification Number of the person against whom the claim exists;

 

2)         the amount of the claim then due and payable to the State;

 

3)         the reason why there is an amount due to the State (i.e., income tax liability, overpayment, etc.);

 

4)         the time period to which the claim is attributable;

 

5)         the fund to which the debt is owed;

 

6)         a description of the type of notification given to the person against whom the claim exists and the type of opportunity to be heard afforded that person;

 

7)         a statement as to the outcome of any hearings or other proceedings held to establish the debt, or a statement that no hearing was requested; and

 

8)         the date of final determination of the debt.

 

d)         The statement required by subsections (b) and (c) shall be executed by the person or persons who are authorized to issue, certify and approve vouchers for the agency under Sections 10 and 11 of the State Finance Act [30 ILCS 105/10 and 11].  The authority to execute the statement of the claim required by this Section may be delegated to a responsible person or persons.  This delegation of authority shall be made on forms provided by the Comptroller and shall contain a signature sample of the persons to whom the delegation is made.

 

e)         A State agency that has submitted a claim for offset must notify the Comptroller as soon as possible, but in no case later than 30 days, after receiving notice of a change in the status of an offset claim.  A change in status may occur due to circumstances such as payments received other than through a successful offset, the filing of a bankruptcy petition, or the death of the debtor.

 

(Source:  Amended at 37 Ill. Reg. 15376, effective September 9, 2013)

 

Section 285.1103  Warrants Subject to Deduction

 

a)         Except as prohibited by federal statute, federal regulation or State statute, the Comptroller shall deduct the amount the Comptroller ascertains is due from any warrant payable to any person against whom there exists an account or claim eligible to be offset.

 

b)         This amount due may be deducted from any warrant, whether or not the warrant originates from the same agency under which the account or claim eligible to be offset arose.

 

c)         If, however, the account or claim eligible to be offset arises from a payroll transaction or other regular payment that is likely to be followed regularly by similar transactions, the Comptroller may deduct the account or claim eligible to be offset from the next regular transaction involving the agency under which the account or claim arose.

 

d)         A settlement payment by the State or any of its agencies to release any pending or potential claim against the State is eligible to be offset.

 

e)         The following are not eligible to be offset:

 

1)         A warrant, payment or transfer in favor of the State of Illinois, or to any officer, board, commission or agency created by the Constitution, whether in the executive, legislative or judicial branch, but other than the circuit court;

 

2)         Any officer, department, board, commission or agency of the State government created by or pursuant to statute, other than any unit of local government and its officers, school districts and boards of election commissioners;

 

3)         Any administrative unit or corporate outgrowth of any of the entities listed in subsections (e)(1) and (2) created by executive order of the Governor.

 

f)         The Comptroller shall not deduct from funds held by the State Treasurer under the Senior Citizens and Disabled Persons Property Tax Relief and Pharmaceutical Assistance Act [320 ILCS 25] or for payments to institutions from the Illinois Prepaid Tuition Trust Fund (unless the Trust Fund moneys are used for child support). [15 ILCS 405/10.05]

 

(Source:  Amended at 37 Ill. Reg. 15376, effective September 9, 2013)

 

Section 285.1104  Processing a Claim Under Section 10.05

 

The following provisions shall govern the processing of a claim under Section 10.05 of the Act:

 

a)         Before making an offset, the Comptroller shall review the information provided by the State agency notifying the Comptroller of a claim and shall ascertain from that information the amount due and payable.

 

b)         The Comptroller shall charge the State agency that submits a voucher against which an offset claim is applied for the full amount of the voucher submitted.  The Comptroller shall draw a warrant on the treasury or on other funds held by the State Treasurer in the amount of the claim eligible to be offset and deposit that warrant into the State Offset Claims Fund.  The State Offset Claims Fund shall be a trust fund established and administered by the Comptroller for the deposit of monies deducted from a person's warrant pursuant to an offset and the subsequent payment of monies back to either the State agency requesting the offset or the original payee.  If, after 60 days have elapsed from the date the Comptroller gives notice of the offset as prescribed in Section 285.1106(a), no protest is made by the person subject to the offset, or upon notification to the Comptroller by the person subject to the offset that the person is waiving the 60 day protest period, the Comptroller shall issue a warrant on the State Offset Claims Fund for the amount of that deposit to the agency entitled to the offset.  If a protest conforming to the requirements of Section 285.1106(b) is made, the Comptroller shall not issue the warrant to the State agency until the Comptroller ascertains the amount due and payable as provided in Section 285.1106(c).

 

c)         If the Comptroller receives a proper request for a claim after he or she has drawn a warrant or warrants, the Comptroller shall, when feasible, reprocess the warrant in order that the offset may be taken, as provided for in this Section.

 

d)         If the amount of the claim eligible to be offset is less than the amount to which the person is entitled, the Comptroller shall draw a warrant for the balance of the amount of the voucher against which the Comptroller has made the offset and shall issue that warrant to the person subject to the offset.

 

e)         In cases in which offsets are to be made against an employee's wages or from pension annuity payments made under the Illinois Pension Code, no more than 25% of the employee's disposable earnings or annuity payments may be subject to offset.  Final compensation payments paid to a person, when the person leaves the employ of a State agency, for accrued vacation or sick leave or overtime are exempt from the 25% limitation.  State agencies may submit claims for offset for the entire amount owed to the State agency and the Comptroller's Offset System will compute the required 25% available for offset.  In the event that the calculation of 25% of the employee's disposable earnings exceeds the net amount of the warrant (i.e., the employee's take-home pay), that employee's payroll voucher will be returned to the submitting State agency. A payroll reversal will be processed and the employee's voluntary deductions must be cancelled or reduced so that the employee's take-home pay will be sufficient to satisfy the amount calculated as available for offset.  State agencies should contact their employees to determine which of the voluntary deductions are to be cancelled or reduced.

 

f)         The limitations set forth in subsection (e) apply to:

 

1)         wage or salary payments;

 

2)         regular and continuing contractual payments made to an individual for personal services paid on a contractual payroll; and

 

3)         pension annuity payments made under the Illinois Pension Code.

 

(Source:  Amended at 43 Ill. Reg. 4534, effective March 26, 2019)

 

Section 285.1105  Wage Deductions

 

Section 10.05 claims arising under this Part have priority over all wage deduction summonses.  If the amount of money represented by the voucher against which the Comptroller is making an offset is subject to a wage deduction and is insufficient to satisfy the amount required to be offset, the Comptroller shall make an offset against any amounts that were deducted from that warrant.

 

(Source:  Amended at 43 Ill. Reg. 4534, effective March 26, 2019)

 

Section 285.1106  Ascertaining the Amount Due and Payable to the State

 

a)         Upon processing a claim under Section 10.05 of the Act, the Comptroller shall, as soon as is practicable, give notice in writing to the person subject to the offset.  The notice shall:

 

1)         state that a request has been made pursuant to Section 10.05 of the State Comptroller Act to make an offset against any warrant on funds held by the State Treasurer that is now or that may become payable to that person;

 

2)         identify the State agency submitting the offset request and the reason for the request; and

 

3)         inform the person that, if he or she does not owe any or all of the amount claimed to be due and payable to the State, the person may, within 60 days after the Comptroller gives notice, make a written protest as prescribed in subsection (b).  The notice to the person subject to the offset required by this subsection (a) shall be deemed to have been given if the notice is enclosed in an envelope plainly addressed to the person, United States postage fully prepaid, and deposited in the United States mail.  For purposes of this Section, the date "the Comptroller gives notice" shall mean the date of withholding, as inidicated by the date on the written notice sent to the person subject to offset.

 

b)         Persons wishing to make a protest to the Section 10.05 offset shall, within 60 days after the Comptroller gives notice as prescribed in subsection (a), notify the Comptroller in writing of:

 

1)         the reasons for contesting the claim of the State;

 

2)         the amount, if any, that the person acknowledges to be due and payable to the State; and

 

3)         any other information that will enable the Comptroller to determine the amount, if any, that is due and payable to the State.

 

c)         Upon receipt of a timely protest, the Comptroller shall determine the amount due and payable to the State.  This determination shall be made in light of all information relating to the transaction in the possession of the Comptroller and any other information the Comptroller may reasonably request and obtain from the State agency and the person subject to the offset.

 

d)         If the Comptroller requests information from the State agency relating to the offset, the State agency shall respond within 90 days after the Comptroller's request.  The Comptroller may grant a State agency an additional 90 day extension of time to respond for the following reasons:

 

1)         the State agency is actively pursuing further investigation;

 

2)         the matter is in active settlement negotiations; or

 

3)         other good cause shown by the State agency.

 

e)         From the deposit into the State Offset Claim Fund made pursuant to Section 285.1104(c), the Comptroller shall issue a warrant to the appropriate fund to the credit of the entitled State agency for the amount found due and payable to the State.  Any balance of that deposit shall be returned to the person subject to the offset.

 

(Source:  Amended at 37 Ill. Reg. 15376, effective September 9, 2013)

 

Section 285.1107  Notification of the Comptroller's Exercise of Section 10.05

 

Whenever the Comptroller exercises his or her offset authority granted under the Act and this Part, the person subject to the offset and the agency that originated the voucher shall be sent a copy of the voucher against which the deduction was made, or a written statement containing all relevant information from the voucher.  The written statement shall include the reason for the deduction and shall indicate the amount of money deducted.  The person subject to the offset and the agency originating the voucher shall receive a copy of the written statement; however, the agency may waive its right to receive the written statement and the voucher.  At the request of the State agency submitting the claim for offset, the Comptroller shall notify the State agency, by letter or other means, of the offset, including the amount of money deducted.

 

(Source:  Amended at 37 Ill. Reg. 15376, effective September 9, 2013)

 

Section 285.1108  Record Retention

 

The Comptroller shall retain a copy of the reason for the deduction in accordance with the State Records Act [5 ILCS 160] and the State Comptroller Act  [15 ILCS 405].

 

(Source:  Amended at 37 Ill. Reg. 15376, effective September 9, 2013)

 

Section 285.1109  Accounting for Recovery

 

Whenever the Comptroller deducts an amount from a warrant under Section 10.05 of the State Comptroller Act, the Comptroller shall charge the vouchering agency for the full amount of the voucher submitted.  Recovery of the account or claim eligible to be offset will be handled in the following manner:  if the account or claim eligible to be offset arose from an expenditure by a State agency and the appropriation to which the expenditure was charged has not lapsed, the amount recovered shall be credited to such appropriation as well as the fund from which the expenditure was made and shall be available for expenditure.  If the appropriation to which the expenditure was charged has lapsed, or if the expenditure was not charged to an appropriation, the amount recovered shall be credited to the fund from which the expenditure was made and shall be available for expenditure unless such credit or availability is otherwise prohibited by law.  If the account or claim eligible to be offset arose from an occurrence other than expenditure, the recovery shall be credited to the General Revenue Fund unless otherwise provided by law. Child support claims which are recovered will be turned over to the Department of Public Aid for distribution to those persons entitled to such claims.

 

(Source:  Amended at 19 Ill. Reg. 227, effective December 30, 1994)

 

Section 285.1110  Transition Period

 

Beginning with the effective date of this Part, for all protests currently on file with the Comptroller, the Comptroller shall notify the State agency which has submitted the claim for offset, of the mandatory 90 day response period and of the possibility of a 90 day extension of the response period.  At the conclusion of the response period, the Comptroller shall make a determination of the amount due and payable to the State based on all of the information relating to the transaction in the possession of the Comptroller.

 

(Source:  Added at 19 Ill. Reg. 227, effective December 30, 1994)