Government Waste, Fraud, and Error Reduction Act of 1998

TABLE OF CONTENTS:

Title I: General Management Improvements

Title II: Improving Federal Debt Collection Practices

Title III: Sale of Debts Owed to United States

Title IV: Treatment of High Value Debts

Title V: Federal Payments

Title VI: Federal Benefit Verification and Integrity Tests

Subtitle A: Notification of Federal Benefit

Recipients Regarding Data Verification

Subtitle B: Federal Benefit Program Management

Improvement Tests

Government Waste, Fraud, and Error Reduction Act of 1998 - Title I: General Management Improvements - Amends requirements regarding certain Federal agencies' (executive departments as well as the Environmental Protection Agency and the National Aeronautics and Space Administration) audited financial statements, including to: (1) extend the deadline for the preparation and submission of the first of such statements; and (2) provide for submission of such statements to the Congress and the Director of the Office of Management and Budget (Director). (Currently, such statements are to be submitted to the Director.)

Allows the head of an executive agency, subject to an agreement between the agency head and the applicable financial institution, to accept an electronic payment to satisfy a debt owed to the agency.

(Sec. 102) Directs the Administrator of General Services to ensure that employees of executive agencies are not inappropriately charged State and local taxes on travel expenses. Requires the Administrator to report to the Congress on the steps taken and proposed to be taken to carry out such requirement.

Excludes lodging provided under Federal travel and subsistence expense provisions from an exception which prohibits agency heads from requiring employees or members of the uniformed services to occupy quarters on a rental basis.

Directs each head of an executive agency to require, with respect to travel by agency employees in the performance of their duties, the use by such employees of travel management centers, authorized travel agents and electronic reservation and payment systems for the purpose of improving efficiency and economy regarding travel by agency employees. Requires the Administrator to develop a plan regarding implementation of this requirement and to report to the Congress on such plan and the means by which such agency heads plan to ensure that employees use travel management centers, travel agents, and electronic reservation and payment systems.

Title II: Improving Federal Debt Collection Practices - Makes technical amendments to financial management provisions relating to claims of the U.S. Government, including those that permit a State to collect by administrative offset certain payments under the Social Security Act, Black Lung Benefits Act, or railroad retirement laws for past due child support being enforced by a State.

Prohibits the amounts received by a person for performing certain collection services for the Federal Government from being limited by State law.

Sets forth provisions relating to the collection by private collection contractors of any debt owed to the United States, including to prohibit a private collection contractor, in attempting to collect any such debt, from being precluded from verifying the debtor's current employer, the location of the payroll office of the debtor's employer, the period the debtor has been employed by the current employer, and the compensation received by the debtor from such employer. Requires collection contracts to include conditions under which contractors are: (1) subject to penalties for failures to comply with applicable law or unreasonable or abusive collection practices; or (2) absolved from liability for damages or attorney's fees in certain cases.

(Sec. 202) Bars certain delinquent Federal debtors from being eligible for the award or renewal of any: (1) Federal financial assistance in the form of a loan (other than a disaster loan), loan insurance, or guarantee; or (2) Federal permit or license.

(Sec. 203) Authorizes the Secretary of the Treasury, at a State's request, to refer a child support debt or claim administered by the State to a private collection contractor.

Prohibits an executive, judicial, or legislative agency head from terminating collection action on a debt unless it has been referred to a private collection contractor or a debt collection center for a period to be determined by the Secretary. Permits the Secretary, at an agency's request, to waive the application of such requirement with respect to any debt, or class of debts, if the waiver is in the best interest of the United States.

Title III: Sale of Debts Owed to United States - Allows an executive, judicial, or legislative agency head to sell, using competitive procedures, any nontax debt owed to the United States that is administered by the agency. Specifies that such sales: (1) shall be for cash or cash and a residuary equity, joint venture, or profit participation, if the proceeds will be greater than the proceeds from a sale solely for cash; (2) shall be without recourse against the United States, but may include the use of guarantees if authorized by law; and (3) shall transfer to the purchaser all U.S. rights to demand payment of the debt, other than with respect to a residuary equity, joint venture, or profit participation.

(Sec. 302) Sets forth requirements for the sale of certain: (1) delinquent nontax debts; (2) loans; and (3) nontax debts or class of debts after termination of collection action.

Title IV: Treatment of High Value Nontax Debts - Requires each agency head that administers a program that gives rise to a delinquent high value nontax debt (a nontax debt having an outstanding value that exceeds $1 million) to submit an annual report to the Congress that lists each such debt.

(Sec. 402) Bars delinquent Federal debtors having an outstanding high value nontax debt with any Federal agency from obtaining any Federal financial assistance in the form of a loan (other than a disaster loan) or loan insurance or guarantee. Permits such a Federal debtor to obtain additional loans or loan guarantees only after such delinquency is resolved.

(Sec. 403) Directs the Inspector General of each agency to: (1) report to the Congress and the agency head on each compromise, default, or final resolution in bankruptcy of a high value nontax debt arising out of the activities of, or referred to, the agency; and (2) rate the performance of the agency head in seeking to collect the debt, and recommend any changes in the agency's debt collection practices to reduce the aggregate amount of high value nontax debts that are resolved finally by compromise, default, or bankruptcy to less than one percent of the aggregate amount of all high value nontax debts.

(Sec. 404) Requires an agency head authorized to collect a delinquent high value nontax debt to promptly seek seizure and forfeiture of assets pledged to the United States in any transaction giving rise to the nontax debt.

Title V: Federal Payments - Transfers from the Director to the Secretary responsibility for the prompt payment of proper invoices by Federal agencies.

(Sec. 502) Includes within requirements of the Secretary's regulations regarding Federal payments that: (1) a required payment date may be waived to provide for early payment in cases where an agency will implement an electronic payment technology which improves agency cash management and business practice; and (2) a vendor is required to pay interest to the United States on unearned amounts in its possession.

Title VI: Federal Benefit Verification and Integrity Tests - Federal Benefit Verification and Integrity Act - Subtitle A: Notification of Federal Benefit Recipients Regarding Data Verification - Requires an agency that administers a Federal benefit payment program to provide notice informing applicants, in information material and instructions accompanying program application forms, that their data may be verified.

Permits an agency to comply with the preceding requirement by modifying program materials and applications to include such notice as part of their normal reissuance cycle for reprinting forms, but in no case later than December 31, 2000.

Requires the head of each such agency to maintain a record of each applicant's acknowledgement that he or she has received notice of the uses and disclosures to be made of his or her information, for as long as he or she receives benefits from or owes a debt to the Government under the program.

Subtitle B: Federal Benefit Program Management Improvement Tests - Permits a Federal agency that administers a Federal benefit program to conduct a test of information technology practices or techniques for improving income verification, debt collection, data privacy and integrity protection, and identification authentication in the administration of the program, in accordance with a proposal approved by a Federal Benefit Verification and Payment Integrity Board.

Requires the Director and the Chief Information Officers' Council to each recommend to the Board various information technology practices and techniques that should be tested.

Permits the head of an agency to develop and submit to the Board a proposal for carrying out a test for a specific Federal benefit program administered by the agency. Specifies that the proposal contain specific goals, including a schedule, for improving customer service and error reduction in the program and other information requested by the Board. Requires such proposal to provide for the testing of information sharing in an integrated manner where feasible of electronic practices and techniques for improving Federal benefit program management.

Requires any agency whose proposals would require access to another agency's database to consult with that agency prior to submission of the proposal to the Board.

States that a proposal submitted to the Board: (1) must contain a description of administrative, technical, and physical safeguards to ensure the security and confidentiality of records and to protect against any anticipated threats or hazards to their security or integrity which could result in substantial harm, embarrassment, inconvenience, or unfairness to any individual on whom information is maintained; (2) include, in particular, prohibitions on duplication and redisclosure of records provided by the source agency within or outside the recipient entity, except where required by law or essential to the conduct of the test; and (3) include an estimate for reimbursement that may be charged by a Federal agency to another agency in conducting tests under the proposal.

Requires the Board to review and recommend disposition of the proposal to the heads of the data sharing agencies under the proposal.

Permits the head of an agency participating in a test to enter into a cooperative agreement with a State or contract with a private entity under which the State or such entity may provide services on behalf of the Federal agency in carrying out the test.

Requires the Board to: (1) prepare a plan for implementation, including for the coordination of the conduct of tests and the procedures for submission of proposals for those tests; and (2) submit annually to the Congress a report on the tests conducted.

Permits the Board to request a Federal agency head that administers a Federal benefit program to conduct a test, including the submission of a proposal for such a test and provides for the agency head to respond within 30 days by approving or disapproving such a request of the Board.

(Sec. 622) Allows the Secretary of Health and Human Services (HHS) to disclose information to another Federal agency from the National Directory of New Hires based on matches conducted by HHS for purposes of conducting a test under this Act.

Authorizes an agency head to whom information is disclosed to: (1) disclose the information to another Federal agency for use by the agency only as specified under a test proposal under this Act; and (2) disclose such information to a State agency administering a federally funded benefit program, a public housing authority, or a guaranty agency (as defined in the Higher Education Act of 1965) only for the purpose of conducting the test. Disallows an entity that receives information for use in a test under this Act that it was not otherwise authorized by law to obtain from redisclosing the information or using it for any other purpose.

(Sec. 623) Amends the Privacy Act of 1974 to: (1) increase certain criminal penalties under such Act; and (2) permit a court, in a civil suit in which it determines that an agency acted in a manner that was willful and intentional, to award punitive damages in addition to damages and costs required under current law.

(Sec. 624) Establishes the Federal Benefit Verification and Payment Integrity Board. Provides for the Board to periodically report to the Director regarding its activities.

(Sec. 625) Requires, if the Board determines that any information technology practice, technique, or information sharing initiative tested was successfully demonstrated in the test and should be implemented in the administration of a Federal benefit program, to: (1) recommend regulations or legislation to implement that practice, technique, or initiative, if that implementation is not prohibited under another law; or (2) include in its annual report to the Congress recommendations for such legislation as may be necessary to authorize that implementation.